We have witnessed a remarkable improvement in the functioning of short-term credit markets and an impressive recovery in the stability of large financial firms. While a whole range of government actions contributed to this recovery, giving financial institutions greater confidence about their access to funding, and that of their counterparties, was most likely a crucial step toward achieving stability. Moreover, the exit from these facilities has been quite smooth. At their peak, these facilities provided more than $ trillion of credit to the economy. Today, the remaining balance across them is around $ billion. It is impressive that the Fed was able to remove itself from such a large amount of credit extension without creating any significant problems for financial markets or institutions. That success largely reflects the effective design of those programs, as most were structured to provide credit under terms that would be less and less appealing as markets renormalized. This design worked incredibly well, as activity in most of the facilities gradually declined to near zero, allowing the Fed to simply turn them off with no market disruption. The success of these facilities should be judged by the outcomes they produced for financial market functioning, and not by the financial returns they generated on the Federal Reserve’s books. However, there are several reasons why the Fed might be expected to profit from this type of lending under most circumstances.
These collections that have been built since the earliest days of our Bank over a period of more than five decades aim to foster greater understanding on the history of our currencies and of our economy and financial system, and also represents our support to contemporary art in Malaysia and thus contribute towards preserving the heritage of our country. Allow me now to invite Yang Amat Berhormat, Dato’ Sri Mohd. Najib bin Tun Haji Abdul Razak to deliver his address and to officially launch Sasana Kijang. 2  BIS central bankers’ speeches