As you know, I previously submitted prepared testimony for a hearing on this topic that was canceled because of weather conditions. I request that that testimony be included in the record of this hearing. This morning, in lieu of repeating my previous prepared statement, I would like to summarize some key points from the earlier testimony and update the Committee on recent developments.
Broadly speaking, the Federal Reserve’s response to the crisis and the recession can be divided into two parts. First, our financial system during the past 2–1/2 years experienced periods of intense panic and dysfunction, during which private short-term funding became difficult or impossible to obtain for many borrowers.