Paul Tucker, the head of markets at the Bank of England, said yesterday that it was "distinctly uncomfortable" for the world's central banks to just to mop up the mess after a bubble burst without acting to prevent the trouble in the first place.
Speaking at a conference in London, he said: "We must try to avoid a vicious circle in which tighter liquidity conditions, lower asset values, impaired capital resources, reduced credit supply, and slower aggregate demand feedback on each other."
