When Greece's national balance sheet threatened to catch fire and burn European neighbors like Portugal and Spain, it was tempting to make the comparison between the Continent's debt woes and the contagion that infected the U.S. banking system in 2008, when Bear Stearns was brought to its knees before being saved by a shotgun marriage to JPMorgan Chase and Lehman Brothers went belly up and had its vital organs harvested by Barclays.  Eventually the Federal Reserve and Treasury Department prevailed in their efforts to get lawmakers to hand over a $700 billion bazooka to shore up the banking system, the Troubled Asset Relief Program. Today, even as debate over the efficacy of the program lingers, it's hard to argue that there wasn't a beneficial impact to stabilizing the market. That impact was far from immediate though; the TARP legislation was passed Oct. 3, 2008, but the market did not reach its nadir until early March 2009.  Similarly, as Greece fell into a debt death spiral, the larger concern was of a global, or at least European, contagion. The European Union and IMF frantically negotiated a package of austerity measures that would allow them to step in and prop up the ailing nation; negotiations that resulted in a $1 trillion European bailout fund that will protect Greece and other troubled economies in the euro zone in return for significant belt-tightening. (See "Europe's Pain, Treasury's Gain.")  Since the news of the bailout program was announced, however, the market has done nothing but decline. With market watchers still debating the root causes of the May 6 "flash crash," the major indexes have stumbled back below the worst levels of that session in a signal that only the rapidity, and not the magnitude, of the decline was possibly erroneous.  Nicholas Colas, chief market strategist at ConvergEx Group, believes one significant cause of the current turmoil is that, like Rodney Dangerfield, central banks and policymakers "get no respect." He worries that "markets seem to have lost respect for policymakers and central bankers to have a real effect on either the economy or asset prices."  That may very well be warranted. Regulators and authorities failed to stem the tide of the massive debt boom before it brought the global economy screeching to a halt, so investors are justifiably skeptical of their efforts to correct their mistakes. In his recent note Colas highlights three ways central bankers might try to regain some of the esteem they've lost.  First, the Federal Reserve could resume quantitative easing. Colas isn't suggesting Bernanke and Co. jump back into the Treasury market--Uncle Sam hardly needs the help with U.S. sovereign debt rallying in response to Europe's woes--but that the Fed resume its purchases of agency paper issued by the likes of Fannie Mae ( FNM - news - people ) and Freddie Mac ( FRE - news - people ) in a bid to keep liquidity flowing in the "critical" residential housing market.  Then there's the matter of bans on short-selling. "Germanys efforts to contain naked short-sellers have not been well received by fellow E.U. countries," Colas writes, but "that could change if the sell off extends." Traction for a short sale ban is likely to be tough to come by in the U.S. anytime soon though. As Colas points out, "bank stocks had been cut in half or more before the SEC limited short sales in financial stocks in 2008." With the industry-mirroring SPDR KBW Bank ETF ( KBE - news - people ) down just 14% since the beginning of May, he thinks "we likely have a way to go before a call for short sale bans here gets any real traction."  Finally, one strategy that Colas and the ConvergEx team expects central bankers to utilize is currency intervention. The 16-nation currency slid again Tuesday, trading at less than $1.23.
Fed and Treasury forces cleaned up the U.S. banking mess pretty quickly, but the market has less faith in a European fix from the ECB.