Will Trump announce another Emergency Moratorium like the 2008–2009 Global Financial Crisis that was formally called a “2008 financial moratorium.” However, the phrase “2008 financial moratorium” is sometimes used (especially in informal discussions, blogs, and certain political circles) to refer to one or more of the following real measures that temporarily halted or restricted normal financial activities during the height of the crisis:
- Temporary Ban on Short Selling of Financial Stocks (September–October 2008)
- On September 19, 2008, the U.S. Securities and Exchange Commission (SEC), followed by the UK Financial Services Authority (FSA) and regulators in several other countries, imposed emergency bans on short selling of hundreds of financial stocks (banks, insurance companies, GSEs such as Fannie Mae and Freddie Mac).
- Duration: In the U.S., the ban originally lasted until October 2, 2008, but was extended for certain stocks until October 8 or later.
- Purpose: To stop what regulators saw as predatory short-selling that was accelerating the collapse of major financial institutions (Bear Stearns had already failed in March; Lehman Brothers filed for bankruptcy on September 15; AIG was bailed out days later).
- This is the measure most commonly referred to as a “moratorium” in retrospective discussions.
- Proposed (but never enacted) Nationwide Foreclosure Moratorium
- In late 2008 and early 2009, several lawmakers (notably Rep. Barney Frank and Sen. Chris Dodd) and activist groups pushed for a 90-day or longer nationwide moratorium on home foreclosures.
- The Bush administration opposed a blanket moratorium, but the FDIC under Sheila Bair implemented a voluntary foreclosure pause for banks it supervised, and some large servicers (Bank of America, JPMorgan Chase, Citigroup) announced their own temporary halts in late 2008–early 2009.
- President Obama’s Homeowner Affordability and Stability Plan (announced February 2009) included a temporary foreclosure moratorium while loan modifications were processed.
- Money-Market Fund “Guarantee” and Redemption Gates (informal moratorium on runs)
- After the Reserve Primary Fund “broke the buck” on September 16, 2008, the U.S. Treasury temporarily guaranteed money-market funds, and some funds imposed redemption gates or delays—effectively a short-term moratorium on immediate withdrawals.
- Global Credit and Interbank Lending Freeze (the real “moratorium” felt by markets)
- In September–October 2008, the interbank lending market essentially froze (LIBOR-OIS spread spiked to historic levels). Central banks had to step in with massive liquidity injections and swap lines because banks refused to lend to each other. Many commentators describe this period as a de facto moratorium on normal credit creation.
Why do people still refer to a “2008 financial moratorium” today?
In certain political and financial-conspiracy circles (especially on platforms like X/Twitter and some Substack writers), the phrase is sometimes invoked to argue:
- That regulators proved they can “turn off” parts of the financial system when they want to.
- That similar emergency powers could be used again (e.g., short-selling bans, redemption restrictions, or foreclosure halts) in a future crisis.
- As a precedent for potential capital controls, bank holidays, or bail-in regimes.
Summary Table of Key 2008 “Moratorium-like” Actions
| Date | Measure | Authority | Duration | Scope |
|---|---|---|---|---|
| Sep 19 – Oct 8, 2008 | Ban on short selling financial stocks | SEC (U.S.), FSA (UK), others | ~3 weeks (varied by country) | 799–900+ financial companies |
| Sep–Dec 2008 | Money-market fund guarantee & gates | U.S. Treasury / fund boards | Temporary (weeks to months) | U.S. money-market funds |
| Nov 2008 – 2009 | Voluntary foreclosure pauses | FDIC + large servicers | Varied (30–90+ days) | Millions of mortgages |
| Oct 2008 | Interbank lending freeze (de facto) | Market-driven | Weeks |