). number of business insolvencies down 6. 6 % in 2017 year on year, press release 91, march 2018. wiesbaden. financial stability board – fsb ( 2011 ). key attributes of effective resolution regimes for financial institutions, october 2011. basel. financial stability board ( 2017 ). framework for post - implementation evaluation of the effects of the g20 financial regulatory reforms. basel. foster, l., cheryl grim, john c. haltiwanger, and zoltan wolf ( 2018 ). innovation, productivity dispersion, and productivity growth, nber working paper 24420, national bureau of economic research ( nber ). cambridge, ma. international monetary fund – imf ( 2017 ), world economic outlook database, october 2017. washington dc. international monetary fund – imf ( 2018 ), world economic outlook update, january 2018. washington dc. pellegrino, giovanni ( 2017 ). uncertainty and the real effects of monetary policy shocks in the euro area, melbourne institute working paper no 15 / 17, june 2017. melbourne. rajan, raghuram g., and luigi zingales ( 2003 ). the great reversals : the politics of financial development in the twentieth century. journal of financial economics 69 ( 1 ) : 5 – 50. rajan, raghuram g., and rodney ramcharan ( 2016 ). constituencies and legislation : the fight over the mcfadden act of 1927. management science 62 ( 7 ) : 1843 – 1859. 1 for example, empirical results for the us show that monetary policy shocks affect output and investment more strongly in times of low financial market volatility than during spells of heightened volatility ( eickmeier, metiu, and prieto 2016 ). similar results were found for the euro area ( pellegrino 2017 ). 2 these numbers are based on data from the federal statistical office of germany available at www. destatis. de / en / factsfigures / indicators / longtermseries / insolvencies / lrins01. html. 3 these numbers are based on data from the bundesbank ’ s mfi interest rate statistics and calculated as a share of domestic banks'credit volume with a respective fixed interest rate of the total volume ( measured by the 5 / 6 bis central bankers'speeches volume of new business ). the time series is part of the system of indicators for the german residential

. given the deceptive tranquillity in the financial markets, we are at risk of forgetting what the crisis has taught us about public finances. but that would have dire consequences. as i emphasised in my opening remarks yesterday, the markets do anticipate that reforms will be finalised and that public budgets will be consolidated. thus, any doubts over the sustainability of public finances can send huge shockwaves across the euro area. in addition, mountains of private and public debt block the way towards sustainable economic growth. and on a side note : at this stage of integration in the euro area, euro - bonds would not be the right path to choose as they would weaken the incentives for prudent fiscal policy. nevertheless, to me, the recent debate about the stability and growth pact shows something else. it seems that there is an expectation that, in the end, monetary policy will provide the ultimate backstop. this expectation, however, is dangerous and cannot be the guideline for policy action – or rather inaction. bis central bankers ’ speeches monetary policy certainly helped prevent the crisis from escalating. still, there is one thing we should be clear about : monetary policy cannot solve the underlying causes of the crisis. it can only buy time. and it is up to national governments to use that time to dig out the root causes of the crisis. failing to do so will push us back into dangerous territory. we must not let that happen. conclusion ladies and gentlemen i have presented what i consider to be good news. the german economy is gaining in strength and the euro area has embarked on the path to recovery. nevertheless, we should keep in mind, what the irish horse racing jockey tony mccoy said : “ there is no place for arrogance or complacency in racing because you are up there one minute and on your backside the next ”. keeping up economically is certainly a race and we should avoid the risk of landing on our backside. thus, my warning : beware complacency. as a final point, let me emphasise that i have very much enjoyed attending this seminar. it has certainly helped strengthen the ties between the central bank of the republic of turkey and the deutsche bundesbank. personally, i am looking forward to more visits next year when turkey assumes the g20 presidency. thank you very much. bis central bankers ’ speeches