of 2013, a slow recovery ensued, with modest but sustained rates of increase in output. only in the second half of 2015, seven years after the first recession began, did the euro area regain overall the pre - crisis levels of income and consumption, levels which even today have still to be restored in the case of gross capital formation. as to the euro area unemployment rate, while it has moved on a declining trend since the current recovery phase began, it remains at close to 10 %, almost 2. 5 pp above the level prevailing in early 2008, and double the rate in the us economy. in spain, which had built up most significant imbalances, the depth and seriousness of the crisis was unprecedented. from 2007 to 2013, gdp fell by close to 8 pp and, foreseeably, it will only be this year, in 2017, that income will reach its pre - crisis levels. as in other episodes of our economic history, the most severe costs were felt in the labour market. in the 2007 - 2013 period, employment declined by over 18 %, taking the unemployment rate, four years back, to 26 % of the labour force. although the economic recovery has provided for an appreciable reduction in this rate, it still stands at around 19 %. foreseeably, several years must go by before unemployment in spain falls to levels comparable with those of other developed economies. of note in spain ’ s case is the heterogeneity of the unemployment rates in different regions, from levels slightly over 12 % 4 / 7 in navarre to close to 29 % in andalusia, with catalonia in the lower part of the table at around 15 %. monetary and financial policy in the face of the crisis the recovery in the developed economies, and in particular in the euro area and of course in spain, has necessitated far - reaching actions in all economic policy areas. early efforts by the central banks focused on alleviating the liquidity problems affecting the financial system. but the serious worsening of the situation opened the way for more powerful plans, both in the financial and monetary realms and in terms of fiscal initiatives to boost aggregate demand. regarding monetary policy, the depth and persistence of the crisis has required an ongoing effort by central banks. over these years, the monetary authorities have broadened their range of instruments, resorting to non - conventional tools that have enabled monetary stimuli to be deepened and that have been conducive to their pass - through to lower borrowing

roughly stable, hovering between about 4. 3 and 5. 0. then, beginning in 1994, the ratio of household wealth to income surged, peaking at more than 6. 0 in 2000. in the past three years or so, however, the ratio of wealth to income has fallen back to about the 1994 level, at just under 5. 0. as you might guess, almost all of this large swing is attributable to the recent boom and bust in the stock market. the aggregate value of u. s. equities, which approximately equaled household disposable income at the end of 1994, reached 2. 5 times disposable income at the beginning of 2000, but then it fell back to 1. 3 times disposable income by the end of 2002. most of us have heard the wry joke that our 401 ( k ) s are now 201 ( k ) s! although in dollar terms, stockholdings remain concentrated in the upper income brackets, the pain of falling stock prices during the past three years has been widely shared : more than half of all u. s. households now own at least some equities, either directly or indirectly through such vehicles as mutual funds, pension plans, variable annuities, and personal trusts ( aizcorbe, kennickell, and moore, 2003 ). for some households at least, losses in stock portfolios have been mitigated by significant increases in the value of residential real estate. these rises in house prices have led some to worry about the possibility of a " bubble " in housing prices and the associated risks of further losses in household wealth, should this putative bubble pop. let me digress for a moment to address this issue. although bubbles in any asset are notoriously hard to spot in advance ( if they were obvious to the naked eye, they would not arise in the first place ), in my judgment there is today little evidence of serious or systematic overvaluation in the u. s. residential housing market. in particular, for the nation as a whole, the rise in house prices appears to have closely tracked economic fundamentals - including rising household incomes, high rates of household formation, and historically low mortgage interest rates. also, the u. s. housing market is not a single market but many markets that are highly dispersed geographically across dozens of disparate standard metropolitan statistical areas, or smsas. experience suggests that house prices across smsas are rather