Introduction

The 2007 global financial crisis, also called the Great Recession, was the worst recession of the developed world since the Great Depression. Governments had to respond decisively on a large scale to contain the destructive impact of a massive debt deflation. Still, large financial institutions such as American International Group, Bear Stearns, Lehman Brothers, Countrywide Financial, Washington Mutual, Wachovia, Northern Rock, and Landsbanki collapsed; thousands of small-to-medium financial institutions failed or needed to be rescued; millions of households lost their retirement savings, jobs, houses, and communities; numerous nonfinancial businesses closed.