Ironically, the presence of large safety net of deposit insurance and state ownership, which ensure that there are likely to be no bank runs, end up eroding any disciplining force that gets the bank health restored to a state where the economy can bank upon its banks to perform the economic function of fueling and lubricating growth.
Weak economic conditions at the national level have translated into hardships in many communities at the same time that communities have fewer resources available for stabilization and revitalization. Considerable good work is going on nonetheless, and I will offer a few examples of that today. At the national level, the economy is recovering at a moderate pace.