the financial stability forum, which has been set up by the g7, under the proposal of hans tietmeyer, to draw the lessons of the asian crisis, is in an ideal position to identify the areas where appropriate improvements could be introduced. i encourage very strongly the financial stability forum and all the committees that are actively working at a global level, including the basel committee, to draw all the lessons of the present turbulences and to examine the situation without any complacency. in my view no single area should be put aside from this review which should concentrate on the ways and means to foster financial stability, prevent propagation of disturbances and contagion, improve risk management at all levels, and diminish procyclicality, in particular, in the domains of accounting rules and accounting practices of rating agencies, of supervisory banking rules – the first duty being to implement globally basel ii which is largely superior to basel i – including harmonisation of liquidity rules and requirements, of supervisory insurance rules, of market supervisory authorities regulations, of regulated and non regulated private institutions ( whether highly leveraged institutions or so - called s. i. v. and conduits ), and of market practices. this does not mean necessarily dramatic changes of rules and overloading of new regulations. i am of the firm opinion that voluntary code of best practices, the set up of voluntary “ principles ” and the working out of voluntary benchmark best practices are most of the time preferable to the addition of new layers of rules and regulations. but we have, in any case, the duty to be effective in working out the lessons of the present market correction. this is no time for complacency in any respect. thank you very much for your attention.

has become too strong – and is partly why european banks are so weak compared with their us peers. do you think that ’ s true? the profitable us banks are in any case leaving european banks further behind. i find that idea quite amusing. conversely, it means that the weaker the supervision, the stronger 1 / 4 bis central bankers'speeches the banks. the truth is that strict supervision leads to strong banks. institutions become more resilient when supervisors require them to hold adequate capital to cover their risks and insist on sufficient liquidity and better risk management. the us institutions received comprehensive state aid during the crisis. and now the united states is even rolling back regulation. both of these represent a disadvantage for domestic banks. up to now, the us authorities have generally only revoked rules that went beyond international standards. but you do have a point. it ’ s important that large international institutions meet the same standards, particularly in trading. that is why we need to have the new basel rules implemented in all major financial centres. moreover, let ’ s not forget that the united states managed to quickly return to a growth path. that has of course been of great benefit to the us banking system too. we were much slower in that regard, also in tackling structural problems. one outcome of the financial crisis was the ecb ’ s controversial asset purchase programme. the governing council has indeed decided to stop purchases, but only very slowly. meanwhile german social security funds have been suffering enormously from the negative interest rates for a long time. shouldn ’ t you be moving more quickly? ending the asset purchase programme is a major first step. but i agree that the side - effects of an extraordinarily loose monetary policy increase over time and i have pointed that out repeatedly. but after pursuing such an expansionary monetary policy, it would be wrong to now move abruptly in the other direction. that wouldn ’ t help either the economy or price stability. but rather? i am very much in favour of normalising monetary policy. that implies that we should gradually increase interest rates again. however, we can only do that if we are on a sustainable path towards price stability. moreover, we should not forget that the social security funds would be in a much weaker financial position today if economic growth had been held back by very tight monetary policy and higher unemployment. and german savers too sometimes forget that they can only save if they have a job. the trick therefore is to move steadily towards the exit without disrupting