resolution of the crisis, and if the conditionality is too tight, too severe, governments don ’ t act and, therefore, nothing happens. bis central bankers ’ speeches md the assessment of conditionality is primarily in the hands of the european commission, the esm, and the imf. but also do not forget that the ultimate assessment of whether to act or not is entirely in the hands of the governing council. ft you announced the programme ; there was immediately a favourable reaction in the markets, remarkable. many people assumed then that the governments would apply, but they haven ’ t. what conclusions did you see? md the purpose of the omt is to remove the tail risks. it ’ s up to the governments to decide upon a programme. we never took a stance which was proactive in the sense of encouraging governments or discouraging governments to apply. let ’ s not forget that the esm is tax - payers ’ money, the decision over which should be taken by governments and by national parliaments. and the same is true for the potential applicants ’ reforms and budget consolidation. the role of the ecb, in that stage, should be on the back stage, not front line. it ’ s up to the governments to decide. ft again, let ’ s just step back a minute. it ’ s been a tumultuous, extraordinary year. you have been a leading player in this drama. there are others, obviously. chancellor merkel, mario monti. what were the moments that stick out in your mind? let ’ s just look where you said the risks are really high and we need to act, if you think about that in the blur of events. md the speech in london on 26 july was such a moment. if you look at the verbatim, it doesn ’ t say anything that ’ s outside our mandate. but indeed it ’ s an especially strong speech that makes a firm statement on the preservation of the euro. ft it was a very, very firm statement. how did you come up with that wording? “ whatever it takes... and, believe me, it will be enough, ” – with a dramatic pause before. md again, there was a sense that we had to overcome the limitations of the smp, and make sure that the signal to the market would be proportionate to the gravity of the situation. that ’ s actually what is behind that statement. ft did you rehearse the

speeches euro area financial markets, this effect cannot just be assumed. to achieve a homogenous reduction of term premia across relevant interest rates, segmentation would have to be taken into consideration in our strategy. overall, the yardstick for the success of any targeted asset purchases would not be the size of our balance sheet, but the observable effect of our operations on term premia across markets and jurisdictions. or put differently, asset purchases in the euro area would not be about quantity, but about price. this is why i said that quantitative easing is a misnomer. however, whether reducing term premia would in turn be effective in reducing real interest rates for firms and households depends on complementary policies, in particular the continued repair of the banking sector. for example, the sizeable reduction of spreads we have witnessed since july 2012 has not in itself translated into higher credit volumes and lower bank lending rates. this is largely because the restructuring of the euro area banking sector remains ongoing. thus, an essential complement to any monetary policy strategy is a strict implementation of the ongoing comprehensive assessment of euro area banks and swift corrective action to bridge identified capital shortfalls. let me conclude. unconventional monetary policy tools are less unconventional than the word implies. they are unusual, because they respond to highly unusual circumstances. they imply risks that have to be carefully weighed and mitigated. but fundamentally, unconventional tools are only a means for central banks to continue doing what they have always done : managing aggregate demand, by influencing the level of real interest rates and other monetary transmission channels, to maintain price stability. to borrow from giuseppe tomasi di lampedusa, in these unusual times “ everything must change, so that everything stays the same ”. it is this that will determine both the appropriateness of using targeted asset purchases in our monetary policy operations, and the design of any such purchases. bis central bankers ’ speeches