its intrinsic tendency to complacency. three intrinsic weaknesses need correction. first, the transparency of the financial structures needs to be enhanced. financial innovation cannot be built upon – and exploit – gaps in investor information and lack of financial literacy. all institutions, instruments and markets of any relevance for systemic stability need to enhance risk disclosure. second, short - termism in the design of financial contracts. market participants were given strong economic incentives to focus on short - term profits. “ due diligence ” was not a concern in the pre - crisis world. collectively, this has resulted in excessive risk taking. third, and perhaps foremost, the pro - cyclicality of the financial system needs to be mitigated. the quality and quantity of bank capital and their liquidity buffers have to be improved in good times to provide a sufficient buffer for bank equity to withstand the inevitable increase in credit risk when the cycle turns. the cyclicality of market economies is inevitable. but the financial system should not be allowed to amplify swings. these three points – and others – are now in the mission of the g - 20, the new prime forum of international cooperation. the g20 has entrusted many of these tasks to the financial stability board – headed by mario draghi. the business activities that you represent here should benefit from financial reform. lenders will be made more attentive to the real economic prospects of their borrowers. long - term value creation will – once again – be the criterion for granting credit to the economy. structural change entrepreneurs will be important actors of structural change, my third way forward. here we can build on assets that have made our real economies in the continent successful : our openness to trade ; our balanced and dynamic business structures ; our talented and well - trained workforces. none of these factors is single - faced. i mentioned already that the openness of our economies has been seen as a major challenge. greater openness has meant that our economies have been more exposed to the international crisis. but the past trend to global trade integration has already called for a major adjustment in the euro area production patterns. many countries in the european union have adjusted their export portfolios according to the technological advantages of advanced economies. in italy, about half of the firms with 20 or more employees are engaged in restructuring. many of them are consolidating their technological edge and diversifying their markets. they have moved towards products that are more skill - intensive and more capital - intensive.

##istic reaction to a few variables or a single official forecast. in addition, concern was often expressed that the eurosystem would not act transparently enough. in this context, it was said that a transparent monetary policy also necessitated the publication of the minutes of the meetings of the governing council and disclosure of the voting behaviour of the individual members of the council. for sound reasons the governing council decided not to adopt this approach. the publication of individual positions could easily lead to national influence being exerted over the individual council members. the members of the governing council must not, however, be seen as national representatives. they decide together on the monetary policy for the euro area as a whole. the governing council has committed itself to go beyond the reporting and explanatory requirements laid down in the treaty, which are among the most comprehensive requirements by international standards. on the basis of our strategy, after every first meeting in the month i deliver to the press a detailed explanation of our assessment of the overall economic situation and, in particular, the outlook for price stability. the content of this so - called “ introductory statement ” is very close to what other central banks refer to as minutes. in this way, the public receives comprehensive information immediately following the meetings of the governing council. in addition, each month we shall publish a detailed report on the economic situation and monetary policy throughout the euro area in our bulletin. such rapid information on the results of the meetings of the governing council and the current economic analysis of the ecb without doubt demonstrates a high degree of openness and transparency. the most recent monetary policy decisions and operations co - operation between the european central banks was always very close. in the last few months of 1998 the countries participating in the third stage of monetary union co - operated more and more closely. the co - ordinated reduction in leading rates at the beginning of december 1998 clearly showed that the currency union had begun de facto before the start of stage three. this co - ordinated measure contributed substantially – as we now know – to the stabilisation of market expectations. for more than five weeks the ecb has been conducting monetary policy operations, mainly in the form of reverse open market operations. the main operation will be carried out at a weekly frequency with a maturity of two weeks. so far, five such operations have been conducted successfully, at a fixed interest rate of 3 %. besides the reverse transactions which constitute the main instrument for liquidity control and targeting interest rates, the eurosyst