for the recovery. 1 indeed, interest - rate and credit - sensitive sectors — business spending, home sales, auto sales, and other “ big - ticket ” items — have helped fuel that recovery. this spending was supported by our timely and forceful moves to cut the federal funds rate to its effective lower bound, restore market functioning, and provide emergency support to households and businesses through 13 ( 3 ) emergency lending facilities. which leads me to the banking industry. for monetary policy to fully support main street, we need a well - capitalized, stable banking system that is lending to creditworthy households and businesses. since the global financial crisis ( gfc ), the federal reserve has focused on building the resiliency of banks so that they would be a source of strength during the next downturn. thus far, that plan has borne a great deal of fruit. as the crisis intensified in early march, banks stepped into the breach and met the massive demands for cash from businesses that drew on their preexisting credit lines. banks also funded the bulk of the more than $ 500 billion in paycheck protection program ( ppp ) loans. according to our weekly bank credit data, commercial and industrial loans increased $ 715 billion between the 1 / 4 bis central bankers'speeches week of february 26th and their peak on may 13th. 2 for millions of struggling households, banks have agreed to forbear interest and principal payments on their loans. in addition, through september, banks absorbed more than $ 1. 2 trillion of central bank reserves and received about $ 2. 5 trillion of core deposits from investors who sought the safe haven of the u. s. dollar and insured bank accounts. as supervisors, we recognized that these actions strained the balance - sheet capacity of banks and so have taken a number of steps to allow them to continue to support their customers during this unprecedented time. a number of those steps — such as encouraging banks to work with their customers until the emergency subsides — are consistent with what we do whenever there is a natural disaster that disrupts normal commerce. but the covid event has affected the entire country at the same time, requiring a broad set of extraordinary actions. for instance, we have temporarily exempted reserves and treasury securities from the supplementary leverage ratio so that banks do not become constrained by growing treasury issuance and central bank reserves and can support businesses and households. 3 more broadly, we have reintroduced and added numerous funding facilities through our 13 ( 3 ) authority to

it is primarily prices for office premises which have displayed a different trend to that seen in the housing market. commercial property prices have adjusted to the economic slowdown. in sweden, both prices and rents have fallen since 2000 at the same time as vacancy rates have risen. i myself do not believe that these price declines are a concern from an economic perspective, as was very much the case with the property crisis at the beginning of the 1990s. although some similarities do exist between the two, the differences nevertheless outweigh them, and i will be coming back to these later. i will also be looking ahead and briefly discussing the driving forces behind price developments in the property market. developments in the housing market in principle, there are two different methods to explain rapid price changes. the first approach is based on the fundamental driving forces that govern prices, and explains price changes through changes in these variables. such fundamental factors include interest rate levels, household income and the production of new homes. the second approach assumes instead that prices are not governed by these fundamental driving forces, but rather are based on expectations of future price rises. such a situation is usually referred to as a “ bubble ”. a recent example of this is the surge in prices seen in it shares during the latter part of the 1990s. the rate of increase observed then proved gradually to be unrelated to fundamental driving forces but rather to unrealistic expectations of a trend that never materialised. when this eventually became evident, prices plummeted. so the price rises seen during a bubble do not mirror fundamental factors but simply reflect expectations of future price increases. investors become involved in a process of speculation where estimates of future cash flow are no longer of importance and price rises are instead assumed to be the trend. if you buy today, you will always be able to sell at a better price tomorrow. where the housing market is concerned, however, there is reason to question whether a bubble is possible at all. this is because most people do not purchase a home primarily as an investment but rather as a place to live. consequently, a house buyer neither thinks nor behaves as an investor speculating on a quick and persistent rise in prices. there can hardly be many people who buy a home solely because they expect to gain financially through a rise in house prices! so assuming that speculation on future price increases doesn't exist, a bubble should quite simply not be able to occur. some of you might now be thinking that this is just a convenient academic approach to the