In this Wednesday, Dec. 12, 2012 file photo, Federal Reserve Chairman Ben Bernanke speaks during a news conference at the Federal Reserve Board in Washington. Federal Reserve policymakers expressed broad support in December 2012 for the Fed's plan to buy bonds to support the U.S. economy. But they differed over how long to keep buying bonds to drive down long-term interest rates. Minutes of the Fed's December policy meeting show that some of the 12 voting members thought the bond purchases would be warranted through the end of 2013. (AP Photo/Manuel Balce Ceneta, File)
Actions the Fed took in 2007 showed that it gradually recognized the scope of the approaching crisis. That year, the Fed began to cut interest rates and took extraordinary steps to ease credit and shore up confidence in the banking system.
Banks and hedge funds that had invested big in subprime mortgages were left with worthless assets as foreclosures rose. The damage reached the top echelons of Wall Street.
By December, the economy had plunged into the Great Recession, which would last until June 2009. Five years later, the economy has yet to fully recover.
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