Since August 2007, the sub-prime mortgage crisis had already hit Europe hard, but the European Central Bank, led by Frenchman Jean-Claude Trichet, decided not to cut interest rates, keeping them at 4% after two increases in March and September 2007. June. Meanwhile, Germany’s central bank, the Bundesbank, had already participated in a consortium to rescue IKB Bank (Deutsche Industrie Bank, a powerful financier of the company) and France’s largest bank, BNP Paribas, had suspended three investment funds linked to the company. Evil ABS. (asset-based mortgage credit-linked securities). The DAX index of the Frankfurt stock market fell by 4.4% between August 9 and 16.

The ECB responded in August by pumping €94.8 billion into the interbank market, but it did not change interest rates and chose to pause until it raised interest rates again in July 2008, in the middle of a deep financial crisis. In fact, Trichet did not make his first interest rate cut until October 2008. But the ECB’s pause on interest rates did not translate into stability in eurozone interbank rates (the eurozone interbank interest rate, which serves as a reference for credit, especially For families with housing loans with variable interest rates). For example, three- and six-month interest rates have skyrocketed and reached nearly 5% at the end of the year (see chart). On annual average, interest rates on new loans to businesses rose from 5.29% in 2006 to 6.07% in 2007, and in the same period, interest rates on real estate loans rose from 4% to 4.8%, and on consumption from 7.46%. To 8.42%, according to Banco de Portugal data. Trichet’s suspension would have meant more pressure on companies and families.

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