will continue. 6. outlook the pfandbrief is undoubtedly a winner of the financial crisis. the voluntary transparency initiative of the association of german pfandbrief banks has also contributed to this. this initiative could be a model for other asset classes – for example abs – to increase transparency and to regain investors ’ confidence. though issuers have to cope with higher competition for the favour of investors, from the perspective of the bundesbank the pfandbrief is well positioned for the future. thank you very much. bis central bankers ’ speeches

##s and levels of gdp per capita [ 14 ]. the abrupt adjustment necessitated by the crisis showed the economic and social cost of this divergence. political convergence is a necessary condition for economic convergence [ 15 ], as it implies making economic and fiscal policy a shared competence in the same manner as policies relating to the internal market. this is particularly true for france and germany, whose cooperation is a driving force. the idea isn ’ t to always move towards harmonisation, but rather to give ourselves the option to adopt common solutions where it makes sense to do so – a common framework to manage insolvent businesses and households could, for example, facilitate the resolution of non - performing loans and contribute to the development of crossborder investment. relaunching the economic convergence process is also essential if we eventually want to set up a fiscal tool to absorb shocks at the euro area level, without creating the risk of permanent, one - way transfers, which are not part of the euro area ’ s initial “ contract ”. as i said elsewhere, this is about establishing a new european social contract, which can only be designed under john rawls ’ “ veil of ignorance ” [ 16 ]. the private sector component of risk - sharing is also extremely important – in the united states, the capital and credit markets act as a buffer for around two - thirds of economic shocks [ 17 ] ; flexible economies and the free movement of goods, services and workers are necessary conditions for the smooth functioning of the monetary union. again, however, risk - sharing must be accompanied by a common framework that avoids excessive risk concentration. this is the essence of the ongoing debates concerning the european deposit guarantee scheme and the capital markets union. this economic convergence process could include a timeline and clearly defined milestones, and would ultimately bring about deeper integration in the fiscal sphere and the creation of shared fiscal tools. the management of these tools, including the european stability mechanism, could be entrusted to a euro area treasury that is accountable to the european parliament. defining its mandate and its tools is a political issue that presupposes a democratic debate [ 18 ]. ladies and gentlemen, the progress of european integration has increased interdependence between member states. but we still haven ’ t drawn all the necessary conclusions and european politicians still don ’ t have the tools that would allow them to respond to the expectations placed on them. this shortcoming feeds popular frustration with european policies, sometimes to the point that they question european integration itself. there