is titled “ ce qu ’ on voit et ce qu ’ on ne voit pas ”, “ what you see and what you don ’ t see ”. monetary policy works by trickling down first to the banks and the financial system and then on to the whole of the economy. so people see the direct impact – unemployed workers will see that we ’ re lifting stock prices, banks will see that we ’ re shrinking their interest margin. they don ’ t see the indirect impact – jobs being created, wages being lifted thanks to higher consumption and investment – and that ’ s what we have to do a better job of explaining. one of the big problems of the euro is that it hasn ’ t produced as much economic integration as you would have thought. how do you address that? that ’ s true. we need more integration and we need more convergence. which is why the budgetary instrument for convergence and competitiveness that has been agreed by the eurogroup is a useful step, although it should evolve over time to include counter cyclical features. what do you think of the involvement of the ecb in the troika that designed and imposed the greek bailout programmes? would you defend it as the right decision? the ecb ’ s involvement in the troika was a symptom of one of the many flaws in the eurozone as it was set up. being in the troika was not the right place for a central bank. but back in 2010, the institutional framework was highly deficient, and the only way to gather and aggregate the relevant expertise was to bring together the commission, the imf and the ecb. the ecb was asked to do it and did it as a service to european governments. i don ’ t think we could have escaped from playing that role and we played it in an honest and professional way. 4 / 5 bis central bankers'speeches now, the institutional framework has improved, we have a new arrangement emerging between the commission and the european stability mechanism, and ecb involvement is much less vital than it was in 2010. we ’ ve already scaled down our involvement ; for some time now in greece, we ’ ve been focusing on financial sector issues, where our expertise is clear, and on broad fiscal topics. we wouldn ’ t take a view on the structure of taxes, or on reforming public administration, or on social benefits, as we have done in the past. how do you feel about the political will for more

vitor constancio : a european solution for crisis management and bank resolution speech by mr vitor constancio, vice - president of the european central bank, at sveriges riksbank and ecb conference on bank resolution, stockholm, 14 november 2011. * * * introduction ladies and gentlemen, it is an honour for me to speak at today ’ s conference, which has provided a stimulating debate on the challenging topic of bank recovery and resolution. the complexity of developing an effective framework for crisis management and resolution arises from the objective of achieving stability in increasingly integrated financial systems, where the authorities responsible for safeguarding their respective stability are still responsible towards their respective taxpayers. this element of complexity has been taken into account in a number of policy initiatives and suggestions worldwide. especially in the eu context, i wish to acknowledge the pivotal role played by lars nyberg in this domain. his long - time devotion to the design and implementation of eu crisis management arrangements, coupled with his qualities as a central banker, have made lars a key policy - maker for crisis management in the eu. i would also like to thank lars for his long - standing and fruitful collaboration with the ecb in this field. principally in the context of the work carried out by the banking supervision committee, but also as chairman of the efc high - level working group on crisis management, lars has very often acted as a catalyst for coordination and cooperation among national authorities and eu institutions. in my speech today, i would like to focus on the ongoing reforms aimed at enhancing the mechanisms with which authorities can handle problems in banks and reduce the potential impact of failures, should they occur. first, i will briefly recall the main shortcomings of the current resolution regimes. second, i will consider the international, european and national initiatives to cope with the challenges. finally, i would like to say a few words about the future path towards an optimal arrangement for cross - border resolution. the main shortcomings of the current frameworks during the current crisis we have seen several government - funded bailouts and one case where, in place of a bailout, a disorderly collapse occurred with widespread effects around the globe. there are multiple reasons why no better alternative between these two extreme solutions was available in these cases. first, letting financial institutions fail was often not a feasible alternative from a legal perspective. in a majority of countries, only normal corporate insolvency proceedings were – and in many countries, still are – available to banks.