summarised as follows. the aim is to enable investors and financial system participants, which include supervisors, to have a better understanding of the risk profile of financial institutions in order to better assess their position. in order to achieve this, financial statements must – in the case of instruments for which it is economically relevant – be sensitive to price signals from markets, which reflect transaction values. i believe that two elements are important in this argument. the first is that financial statements have the crucial merit of providing information. the second is that the rationale of fair value valuation contains within it its own limitations. the concept of " transaction ", which is fundamental in this context and, as a result, that of " market ", should constitute the limits of the scope of application of fair value accounting. are accounting choices neutral? it goes without saying that the greater sensitivity of balance sheets to market fluctuations resulting from fair value accounting obviously has an impact on financial stability. a central banker may legitimately wonder whether accounting conventions are neutral with respect to the behaviour of financial players and market dynamics. the current crisis and volatility that we have been faced with over the past few months suggest that accounting conventions have an impact in terms of financial incentives and may have had a not insignificant impact on financial players'strategies. one example serves to illustrate this point. it is macroeconomic in nature and relates to risktaking by financial institutions. it is the possibility, in the case of some instruments, of recording as of the first trading day all of the discounted future profits even though the risks remain on the balance sheet. if we are to believe the financial industry itself, this possibility has an impact on investment strategies. it cannot be ruled out that because this rule makes it possible to record substantial income flows during cyclical upswings, it has contributed to greater risk - taking by some institutions in order to maintain these income flows year after year. in a more general way, the extension of the scope of application of fair value accounting has very probably, during cyclical upswings, also contributed to many assets being accounted for at market value whereas the intention of market participants to manage these assets on a fair value basis was not clear. my aim here is not to make a judgement about the relative merits of accounting choices. it is to highlight the fact that these choices have implications that go beyond accounting policy. in concrete terms, therefore, the question that we need to ask collectively is : what is the optimum policy response? do

monetary normalisation is consequently fully warranted in the euro area among others. it ’ s too early to tell the final interest rates. but the neutral rate r * helps us to give some light on the first part of the journey. i believe that in the euro area r * can be estimated as below or close to 2 % in nominal terms, and we could be there by the end of the year. until then, we definitely have to act, in a determined but orderly way. doing so is normalisation, only beyond r * would tightening begin if needed. the us is obviously closer to tightening : due to several differences in the nature of inflation across the atlantic, the monetary answer must have its differences too. but in both cases, it ’ s not only a legal duty, it ’ s also an ethical commitment : ensuring price stability is our responsibility ; our will and our capacity to deliver on our mandate cannot be subject to any doubt whatsoever. 3. accountability turning to the third corner of the golden triangle of trust, accountability, you remember that famous sentence by alan greenspan : “ i know you think you page 6 sur 10 understand what you thought i said but i'm not sure you realize that what you heard is not what i meant ”. this provocative sentence certainly captured the difficulty for central banks to account for their monetary policy, but let's be clear, it belongs – or must belong - to a bygone era. no matter how complex, it is central banks ’ duty to account for their monetary policy decisions in a comprehensible manner ; accountability is the natural counterpart for independence. this necessary change has both a cyclical and a structural component. - the cyclical component pertains to the way we can combine agility and predictability in a very uncertain environment. we should be careful not to return to secrecy, or to unnecessarily add to financial and economic volatility. otherwise, as research at the banque de france shows, economic agents may begin to question our ability and commitment to fulfil our objectives, which could translate into dis - anchored long - term inflation expectationsiv. i suggest in my recent jackson hole speech some principles for this “ new predictability ” v. not having a forward guidance does not mean, cannot mean, not having a narrative and a monetary strategy. - the structural component is that our communication must not only resist the risk of “ political dominance ” or “ market dominance ” that would run