by the manager itself, it is not, or not mainly, the possible default of the manager that should concern regulators. on the other hand, the actions of asset managers may affect the financial system and the general economy through their systemic consequences on market developments. the key questions are then whether, to what extent and under what conditions non - bank intermediation can amplify market movements and determine instability. it is, therefore, essentially a macro - prudential question. understanding and measuring such risks will require data, research and careful reflection ; tackling them is likely to require new or reinforced supervisory tools and, quite possibly, a broader mandate for supervisory authorities. why do we need a macroprudential framework for the non - bank financial sector? we shall start by briefly reviewing certain macro - stability issues and the reasons why they may have become more significant than in the past. i shall focus on three main issues of concern : ( i ) pro - cyclicality, ( ii ) the size of non - bank financial institutions, and ( iii ) systemic liquidity risks ( ‘ runs ’ ) and leverage risks. let me tackle the pro - cyclicality issue first. the collective behaviour of asset managers, insurers and pension funds can lead to undue amplifications of market volatility. 1 empirical analyses show that institutional investors ’ trading may cause substantial temporary price effects, both at the asset level and at the aggregate level. 2 during downturns, trades by institutional investors in financial distress may turn into fire sales, and a temporary price effect may be further magnified so as to put severe pressure on market liquidity. 3 this amplification effect can have wide - ranging negative repercussions on the banking sector, on households ’ savings, on firms ’ funding, and ultimately on the entire economy. a clear example was the outbreak of the financial crisis, when a complex network of connections through derivatives and shadow banking activities turned $ 500 billion of losses on sub - prime mortgages into $ 4 trillion of write - downs on assets at global level. 4 see for example chan l. and lakonishok j. ( 1995 ), ‘ the behavior of stock prices around institutional trades ’, journal of finance 50 : 1147 - 1174 ; keim d. and madhavan a. ( 1997 ), ‘ transactions costs and investment style : an inter - exchange analysis of institutional equity trades ’, journal of financial economics 46 : 265 - 292 ; jones c

, with the bank of italy and its researchers is also vivid. starting from the late 1980s stefano fenoaltea actively participated in the work on the research project that carlo azeglio ciampi promoted for the centenary of the institute in 1993, with pierluigi ciocca as a mentor and franco cotula as head of the newly created historical research office. these studies were published in the historical series of the bank of italy and can now all be accessed online on the bank ’ s website. over the years stefano was heavily involved in the reconstruction of value added data, especially on industrial production and eventually also at the territorial level, for several benchmark years, starting from the crucial 1911 that would cause a good deal of controversy among italian economic historians. his works were published as chapters of our historical series books, two of them edited by guido rey, the former president of the italian national statistical institute. he was also a substantial contributor to the bank ’ s historical research papers ( now the economic history working papers ). over the last twenty years and until his untimely death, while engaged in the project for the reconstruction of regional statistics, stefano further developed his fruitful collaboration with the bank of italy, in a more organic way and on an even closer basis. he joined the scientific committee of the historical research papers, contributed to the planning of the seminars in economic history and reviewed many studies. he was a regular point of reference for ( often scientifically severe ) confrontation and exchanges of ideas, for reflections on the economic history of the country, on the methodologies of analysis, on the interpretation of the results. he also contributed with his constructive criticism to the success of another major historical economic research project carried out in the bank under the direction of professor gianni toniolo for the 150th anniversary of italy ’ s unification. furthermore, he significantly helped to foster the development of the relationships between economists and economic historians of the bank and the italian and international academia. as i said, during his long - lasting collaboration with the bank, our economic history working papers were a primary tool stefano chose for disseminating the preliminary results of his works of statistical reconstructions as well as other contributions. over the last decade he continued on almost a daily basis to frequent the offices of the economic history division where he had a workstation at his disposal. it is also, therefore, on the bank ’ s premises, that he developed and matured the thoughts related to the latest scientific production collected in his