One risk facing financial institutions is losing reputation, and a key contributor to it is financial panic. For instance, the first signs of impending financial crises appeared in the United States in 2007, when real estate prices began to collapse and sub-prime mortgages began to spike, which contributed to financial panic during September and October, 2008. Why do the Fed and other central banks worry about financial panics? In addition to reserve requirements and interest rates, what tool does the Fed use to prevent financial panic? Has the Fed always effectively used these tools?