s resilience, we need to take a look back at one of the darkest periods in new york city ’ s history : the 1970s. i remember new york city in the 1970s from my freshman days at columbia university. columbia was a great place to be a young student. there were engaging professors and i had the opportunity to read the great books of the university ’ s core contemporary civilization curriculum. recognizing the strong literary traditions of the lotos club, i would also note that i had the fortune of reading some of the great works of middle english, including chaucer. i also enjoyed being on both the freshman wrestling and golf teams — even if it was an odd pairing and our teams were not very good. in contrast to columbia, the city seemed much less attractive. from my perspective as a naive 17 - year - old from suburban massachusetts, it seemed outright dangerous and dirty. the danger was driven home immediately. one of my roommates was robbed his first day during a walk through one of the nearby parks. he didn ’ t understand, nor did i at the time, that certain places near columbia weren ’ t very safe, even during daylight hours. while you could avoid the crime by being careful where you went in the city, there was no avoiding the pollution. during this period, new york city still had considerable manufacturing activity, many apartment buildings burned low - grade oil and incinerated trash, and this was before the days of automobile catalytic converters. this confluence meant that grit was 1 / 5 bis central bankers'speeches everywhere, and even for the non - fastidious — which i admit i was one — showers were an absolute necessity on a daily basis. sometimes it was so bad that you couldn ’ t see across the hudson river, which was just a few blocks away! in order to understand the situation the city faced in the 1970s, we have to look back a decade earlier. the 1960s were a time of hope and promise for new york city, with the world ’ s fair, the opening of the verrazano bridge, and the beginning of construction of the world trade center. the city benefited from a booming stock market and strong overall job growth. my memories of new york city during that period were very glowing. visiting from massachusetts, i remember going to the world ’ s fair and to a mets game at the new shea stadium — heady stuff for an 11 - year - old. as a boy who planned to be a nuclear physicist when he

be earned. both of these events underline that trust is the most important asset that banks can have, the most important weight for balancing financial stability. confidence and trust are the foundations of any well - functioning financial system, and we all know, or should know, that trust takes years to build, seconds to break and forever to fix. 2 / 4 bis - central bankers'speeches to maintain financial stability we do not only have to adapt to changing conditions, we also have to create the conditions to be able to adapt when stability is threatened. that is why i want to stress the importance of adequate financial buffers : the umbrella that is needed to avoid getting soaked when there is'a dirty looking sky '. like the importance of trust, the crucial role of buffers is another important lesson we learned from the global financial crisis. a lesson that we turned into action. the changes in sectoral regulations and supervisory standards have made our financial sector safer and better capitalized. the introduction of the macroprudential framework strengthened its ability to absorb rather than amplify shocks. the resolution mechanism has reduced the cost of winding up financial institutions. all these steps have made our financial sector and our economy more resilient to adverse economic shocks. the robust capital position of the banking sector is part of the reason why a major economic shock such as the covid pandemic had a limited overall impact on financial and economic stability. that's why i want to emphasise how important it is for european policymakers to fully and comprehensively implement the global tightening of the banking capital framework - as agreed in basel iv - in the european union. especially now. and from my perspective as chair of the fsb it is positive that we are also strengthening the global supervisory framework for non - banks. these institutions must also learn to carry an umbrella. yes, buffers are essential to consolidate public finances, to ensure financial stability. but not only do we need to be able to adapt to changing conditions and create the conditions to be able to adapt, we also need to be able to bounce back after things go wrong anyway. after'the big snow '. a prime example of successful snow removal was the consolidation of public finances that ireland undertook after the global financial crisis. just how successful ireland was can be illustrated by a simple comparison with spain after that crisis. in both countries the public debt to gdp ratio skyrocketed very quickly. the ratio in ireland went from 30 % to 130 %, but