With an economic downturn some stocks will drop in price and the averages will decline. This means that some will hold on and prevent the market from falling to zero. And after the fall, the market will rise again, as greed replaces fear. The good news is that these market fluctuations need not have major influences on the real economy and employment.
Governments have plenty of tools.
They even have a few people around who remember how to use them. The real problem is that politicians lack the confidence to speak up and to order the tools to be used. Thus the failure will be the worst kind - having the capacity to do something but failing to act. Energy price rises favor oil companies and other energy companies and suppliers to them. Others suffer by them.