17 February 2009: Obama signs the $787 billion stimulus

President Barack Obama signed the American Recovery and Reinvestment Act, a roughly $787 billion package of tax cuts, infrastructure spending and aid to states. It was one of the largest fiscal stimulus packages in US history. Stocks kept falling for three more weeks before bottoming in March. Economists still argue about how much it helped. Markets, as usual, did not wait for the debate to end.

The lesson: Policy responses take time to work, while markets try to price the outcome long before it arrives.