##s of the economic process, resulting in misallocations and expensive avoidance strategies. it is mainly the economically weaker groups in society which suffer from that - those who are unable to evade the creeping erosion of money. those groups mainly include the recipients of wages, pensions and government transfer payments, as well as those who hold savings accounts. the safeguarding of stable money is thus also, at the same time, enlightened social policy. ludwig erhard made the same point as follows : “ the social market economy is unthinkable without a consistent policy of price stability. only such a policy also guarantees that individual groups in society do not enrich themselves at the expense of others. ” 3 that is one of the major reasons why price stability has played such an important role in post - war west german history. maintaining the stability of the d - mark was, and has always been, an aim of german policy during the past 50 years. iii it is for good reason that enduring stability is now also the aim and yardstick for the new european currency, the euro. for that purpose, a regulatory framework that is binding in international law was laid down in the1992 maastricht treaty. the mandate to maintain price stability has been assigned as its primary objective to the european system of central banks ( escb ), which is independent of political instructions. the escb has been equipped with all the powers and instruments needed to pursue an effective monetary policy. at the same time, the escb is prohibited from any monetary financing of public - sector budgets. this means that a regulatory framework - precisely as called for by ordo - liberalism - has been put in place, with which - in the light of all past monetary policy experience - it may indeed be possible to safeguard stable money on a lasting basis. happily, the euro was launched at that start of this year in a setting characterised by a high degree of price stability in all the participating countries. at all events, their inflation rates were - and remain at an all - time low. the same applies to their long and short - term interest rates. l. erhard : wohlstand fur alle, dusseldorf, vienna 1964, p. 15 at the beginning of april, in fact, the governing council of the ecb - in line with it stability - policy orientation - made a further cut in official interest rates. the reason for this was that the monetary data and the price outlook continue to suggest a high degree of

have severe repercussions on a country ’ s competitiveness and trigger painful economic adjustments. after all, in addition to the fundamental alternative of flexible exchange rates, there are also intermediate solutions such as basket pegs or even crawling pegs. given global financial markets, international investors and the free movement of capital, exchange rates are nowadays - even more than before - “ bridges ” between the economies. these bridges may be fixed or movable. what is crucial, however, is that they are strong and sustainable. pegging to another currency must therefore be given very careful consideration, and the economic setting and internal adaptability must also be taken into consideration. vi in his novel “ the unbearable lightness of being ”, milan kundera, the well - known czech writer, also wrote about the burden of taking decisions. in other words, people can never know what they ought to want, because they only have one life and that life cannot be compared with earlier lives nor can it be corrected in later ones. therefore, it is impossible to tell what is the right decision because there is nothing to compare it with. there are no comparisons for the euro, either. it is a unique project in europe ’ s history. and much depends on its lasting success. a number of nation states, which in other respects are largely sovereign, are giving up their own currency in favour of the euro, and thus also relinquishing a major element of national sovereignty. given global integration, this historic change in the economic policy has an impact going far beyond the participating countries which affects neighbouring countries and trading partners. everyone must now adapt their future decision - making on regulatory policy to the changed environment. unlike tomas, the character in kundera ’ s novel, those bearing responsibility must not avoid making the necessary decisions. and i am also sceptical as to whether it will be enough - after taking the decisions in favour of monetary union and the euro - to rely on the emergence of a “ spontaneous system ”, as called for by hayek. certainly, the risk of “ constructivist error ”, which hayek warned against with the planned economy in mind, can never be dismissed out of hand. in other words, one should not overestimate what is possible in each given case. nevertheless, it is precisely in the area of regulatory policy that there are sufficient lessons to be learnt from the past. this means that there are also guidelines suggesting the approach to follow, a few of which i have