public administration and insolvency regimes. this would make their economies more resilient and help them to grow. and i ’ m not just referring to institutions at the national level. european institutions are not free of deficiencies either. they too need to improve. if we want european citizens to trust europe, we need to make sure we deliver on our promises. and there is a long way to go : according to the latest eurobarometer survey, only 41 % of europeans tend to trust the eu. and the latest election results show that anti - european parties are still on the rise – think of germany, think of italy. so there is a need for reform and a need to explain thoroughly how the european union benefits each and every european citizen. conclusion ladies and gentlemen, history does not end for monetary policy. it did not end with the great moderation, and it will not end with the exit from our unconventional measures. there are still many questions that need to be answered, some of which i have discussed in my speech. but although monetary policy still needs to evolve, it must do so within a certain framework. and this framework is defined by two things. first, even though central banks have assumed a key role in the crisis, their objective is very clearly defined : to ensure price stability. second, to achieve this objective, central banks need to be independent. within this framework, we need to answer all the questions which remain open. so, there is still a lot of work to be done in terms of both theoretical and empirical research. that ’ s where universities come into play. they can help us to gain additional insight, and they can help us to come up with new ideas. from an academic viewpoint, these are certainly interesting times. now, history might not end, but you ’ ll be glad to hear that speeches do. i have raised a few issues that are currently being discussed in connection with monetary policy. and now i look forward to having a discussion with you on these and any other issues you might want to raise. thank you for your attention. 1 european economic forecast, european commission, autumn 2017. 2 see blanchard, o., dell ’ ariccia, g. and mauro, p. ( 2010 ), “ rethinking macroeconomic policy ”, journal of money, credit and banking, 42, 199 – 215 ; and krugman, p. ( 2014 ), “ inflation targets reconsidered ”, ec

sabine lautenschlager : monetary policy - end of history? speech by ms sabine lautenschlager, member of the executive board of the european central bank and vice - chair of the supervisory board of the european central bank, at the center for financial studies colloquium, frankfurt am main, 29 may 2018. * * * in 1992, the political scientist francis fukuyama announced the end of history. the cold war had just ended, and in fukuyama ’ s view, this marked “ the endpoint of mankind ’ s ideological evolution ”. liberal democracy had prevailed ; the final form of government had been reached. there was no need for history to continue. similar claims were made about monetary policy. the great moderation, for instance, was traced back to better monetary policy. with this in mind, some argued that monetary policy had reached a perfect and final stage. there was no need to evolve further ; history had come to an end. or had it? well, it seems that the unexpected always happens. and when it does, it tends to push the end of history a bit further away. this is true for politics, and it is true for monetary policy. the unexpected happened in 2008 : the global financial crisis struck and undid the great moderation. history took a sudden turn and this threw long - held beliefs overboard. academics as well as policymakers had to adapt their thinking and their doing – monetary policy was no exception. central banks around the world came up with new tools to keep the financial system and the economy afloat. they became key players ; some observers even referred to them as the only game in town. now, ten years later, there is one thing that weighs on many people ’ s minds : when will unconventional monetary policy end? when will it return to normal? it seems that many look no further than the exit from our unconventional measures. but what will happen once we have reached the exit? will we return to the end of history? well, i don ’ t think so. first, there are still many questions that need to be answered. and second, the unexpected will happen again at some point. history does not end. but before we discuss what will happen tomorrow, let ’ s take a look at today. approaching the exit – slowly but surely for many months, we have been discussing the conditions for a gradual exit from our extraordinarily loose monetary policy. but some might now point to the latest economic