implementation of euro - area fiscal discipline … but governments chose to side - step their responsibilities in this respect. bis central bankers ’ speeches in 2003, france and germany, the two most powerful states in the euro area, breached the famous maastricht criteria … are they not partly responsible for the subsequent crisis? each member states carries a share of the blame. the ecb however is not to blame. there were strict fiscal rules. if governments had respected these rules we would not have had this chain reaction leading to the current crisis. in 2007, 2008 and 2009, we had to prevent the financial crisis from deepening and limit the consequences for the real economy. the ecb and states did what was expected of them by supporting the banking systems. however, after 2009, the markets started looking at the accounting situations of each member state and started doubting the capacity of certain states to honour their financial liabilities. the markets also remembered that behind the governments ’ bank rescue plans there were states and with no single or common signature and that the banking system was not sufficiently uniform at the european level. each state therefore found itself with its own financial credibility and its own specific debt financing conditions, depending on its individual fiscal situation. and in this respect, what is your opinion of the policy orientations adopted by francois hollande, his government and the new majority? i am pleased to see that the objective of a return to fiscal equilibrium within five years is one of the new government ’ s priorities. the president of the republic has undertaken to achieve balanced public accounts by the end of his mandate. this is a necessary target. so far, the tax increases have allowed the financing of additional spending and the reduction of the deficit. i am waiting to see the 2013 budget proposal to measure exactly by how much the state ’ s spending will be reduced. in concrete terms, what exactly would you like to see? the cour des comptes ( court of auditors ) has compiled a list of the different potential savings that the government should examine. i agree with its analysis. it is indeed a colossal and ambitious project. alongside the reduction of public expenditure, we must also encourage investment, entrepreneurship and restore confidence for those who wish to start a business. we therefore need structural reforms and a reform of our labour laws to allow greater flexibility with the objective of restoring and improving the competitiveness of our economy. we must change our social model because it is no longer coherent with global competition. bis central bankers ’ speeches

want to ascertain the credibility of the entity to which they are lending money. hence the need for consolidation efforts in most countries. besides, solidarity itself implies that everyone make as much effort as possible, because should this aid not be reimbursed, additional taxes would have to be raised in all countries. after all, the credibility of the ecb is intact... why not use the instruments at your disposal to appease the markets ’ doubts? is germany imposing its conditions on the rest of europe? the ecb has a range of tools to ensure price stability and the proper functioning of the market. it can remedy market disruptions. it has done so several times in recent years to avoid a “ credit crunch ” by greatly increasing its provision of liquidity to the banking system and by lengthening the maturity of refinancing operations. still within our mandate, we are able to take quite significant non - standard measures and we have done this on several occasions. the mandate of the ecb is also to ensure the solidity of the euro. but the ecb cannot replace governments, nor spare them from making the necessary efforts to control their debt and restore the competitiveness of their economy. the credibility of bis central bankers ’ speeches governments cannot rest on the central bank. and yet, the former must demonstrate their determination to improve their fiscal position. but under germany ’ s pressure, the ecb is not using all the instruments at its disposal. how is this justifiable when huge efforts are required of spain and italy? the ecb is being unfairly accused. no central bank in the world – neither the fed nor the bank of england – directly funds governments or purchases sovereign debt on the primary market to finance their deficits. however, it is possible on the secondary market. we have done so in the past. there are no differences of opinion between the french, the germans and the european commission. all say the same thing : we are not against ecb intervention to correct market anomalies. but it only makes sense if the economic and fiscal policies pursued aim at correcting imbalances and restoring balanced public finances. some people are now expecting greece and spain to leave the euro. are you preparing for such a scenario? we are not contemplating a greek departure from the euro area. moreover, such a scenario is not provided for by the treaty. there is therefore no plan to prepare a country ’ s exit from the euro. besides, comparing spain to greece