Introduction
Today, we are still in the midst of the greatest financial stress our economy has seen since the Great Depression. The extent of the disruptions is very broad—from commercial paper to consumer and business loans to asset-backed securities, interbank lending, and risk management products. Many borrowers are finding it difficult to obtain access to credit under terms and conditions they would find in healthier times.
You as bankers are well aware that your industry has been under siege during the past year and a half, even though only a relative handful of institutions out of many thousands nationwide have actually been involved with the underlying problems that launched the crisis. But the widespread fragility of credit markets now affects us all, and it is deepening and prolonging our recession. So I think that all of us in the banking industry as well as the regulatory arena have a role to play in restoring public confidence and trust in what we do—we must all work together.
Significant monetary and fiscal forces are already at work to counteract the recession. A very sizable fiscal stimulus package is now in place, as well as a comprehensive strategy for addressing the plight of millions of distressed mortgage holders. The Federal Reserve is aggressively using all of the tools at our disposal to provide liquidity to financial markets and to promote an economic recovery.
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