I will explain why. But first I would like to describe very briefly what characterised the crisis. The characteristics of the financial crisis I have experienced two crises in the past, one in the late 1970s and early 1980s and one at the beginning of the 1990s, and have seen them both mainly from the perspective of the Ministry of Finance. When I came to the Riksbank I believed that the worst crises were behind us. However, this was not the case. Instead we experienced a third crisis, which in international terms was the most severe crisis since World War II. The financial crisis hit Sweden and the rest of Europe with full force in September 2008, when the major US investment bank Lehman Brothers filed for bankruptcy. It became much more difficult for the banks to fund their operations as the financial markets were not functioning normally. Some markets were not functioning at all. The central banks took on the role of lenders of last resort and several governments provided guarantees and support programmes for the banking sector. Monetary policy also quickly became more expansionary in the United States, the euro area and other countries. In addition, a number of central banks adopted measures to also push down the longer-term interest rates. There was also a shift towards a more expansionary fiscal policy. Despite extensive policy stimulus, the financial crisis led to a severe downturn in the United States and Europe and in developed countries in other parts of the world.
Last, the shock experienced by the real sector will not overcome without leaving traces in the financial market and in the indicators of the banking sector’s business, as well. The dimensions and complexity of the crisis demand for a coherent and comprehensive response. Absolutely, public authorities have the primary role to play in this regard. The fiscal, monetary and financial stimulus, are essential instruments to boost the aggregate demand, mitigate the liquidity problems and avoid the long-term consequences of the crisis. Nevertheless, firms and banking sector should not consider themselves as passive consumers of the economic policies, but as exceptional actors in our efforts to resolve the crisis. The stimulus of public authorities could be neither effective nor potentially sufficient, without the adequate reaction of both firms and banking industry. Dear guests, Allow me to introduce briefly the reaction of public authorities, and further to share with you our vision on the challenges and role that the Albanian firms and banking sector should play. 1. Reaction by public authorities In the face of the unprecedented health emergency, the focus of public policies – in Albania and globally- was the undertaking of severe social distancing measures. Naturally, these measures have hit the economic activity and have demanded for a comprehensive easing of fiscal, monetary and financial policies. 1/4  BIS central bankers' speeches  Fiscal policy – rightfully- has been given a primary role in facing the situation.