Access to credit, economic output, and employment outcomes are intimately connected, and it was imperative that the Fed step in to prevent a negative spiral and provide a bridge to the recovery. As Chair Powell has noted, the Federal Reserve remains committed to using its full range of tools to support the economy for as long as is needed, to ensure that the recovery will be as strong as possible. Thank you. 1 I am grateful to Jordan Pollinger, Josh Frost, and Anna Kovner for their assistance in preparing these remarks, and colleagues in the Federal Reserve System for valuable  comments and suggestions. 2 Emin Dinlersoz, Sebnem Kalemli-Ozcan, Henry Hyatt, and Veronika Penciakova (2018), Leverage over the Life Cycle and Implications for Firm Growth and Shock  Responsiveness, NBER Working Paper Series 25226 (Cambridge, Mass. : National Bureau of Economic Research, November; revised September 2019). 3 Anna M. Costello (2020), Credit Market Disruptions and Liquidity Spillover Effects in the Supply Chain, University of Michigan. 4 Large companies drew down credit lines of approximately $ billion during the first quarter of 2020. Note that large firms are defined here as having $ million or  more in assets. Source: Gabriel Chodorow-Reich, Olivier Darmouni, Stephan Luck, and Matthew Plosser (2020), Bank Liquidity Provision across the Firm Size Distribution, Federal Reserve Bank of New York Staff Reports No. 942, October 2020. 5 Distressed is defined as a credit spread to Treasuries greater than 1000 basis points.
For one thing, credit creation by the banks is continuing to be slow-moving. For another, the growth of the money stocks is considerably influenced by portfolio shifts, which are likely to be reversed once economic activity accelerates and interest rates begin to rise. We shall, however, continue to keep a careful eye on this development. As already stated, there are still certain risks that the economic development will not be sustained. The upswing in Switzerland should not be jeopardised by a premature changeover to a more restrictive monetary policy. We shall therefore continue our expansionary monetary policy and in this way further bolster the economic recovery. We are convinced that we shall have sufficient time to keep inflation within the bounds of price stability by tightening monetary policy at a later point in time. Should a possible marked appreciation of the Swiss franc vis-à-vis the euro threaten to cause an undesirable tightening of monetary conditions, we would again take decisive action. 2  BIS Review 58/2003  Inflation Forecast December 2003 with Libor at 0.25%  2003  2004  2005  2006  Annual average inflation in %  0.6  0.4  1.0  2.3  Inflation forecast of December 2003  New National Bank Law in the making On 3 October, the two Federal Chambers passed the new National Bank Law. We are very happy with the course of the parliamentary debate: only minor amendments were made to the draft of the Federal Council. The deadline for a referendum is 22 January 2004.