be sure about the precise timing or the size of the adjustment. as i previously emphasised, external imbalances could persist for a fairly long period, and the prospect of a rapid adjustment is not imminent. the main concern is that a purely market - determined adjustment might turn out to be abrupt, with a potentially adverse impact on global economic growth and financial stability. what can be done, then, to avoid this? global challenges require global answers. each of us must play his part to ensure an orderly adjustment. industrial countries, in particular, can make a key contribution. in the united states, this contribution can come from higher national savings, including from further fiscal consolidation. moreover, the low level of private savings in the united states is a concern and needs to be addressed. as regards europe, our contribution should come from further structural reforms aimed at increasing productivity growth and market efficiency through more competition and innovation. such reforms will help stimulate economic activity and raise growth potential. furthermore, such reforms, by improving the functioning of markets, can be expected also to increase the flexibility of the european economies through greater reliance on market mechanisms, and thus enhance our economies ’ resilience to shocks. this would also prove beneficial when current account imbalances begin to unwind. in this joint effort to avoid a disorderly adjustment of existing current account imbalances, what role does emerging asia play? the reduction of global imbalances in an orderly manner is a key international policy priority. emerging asian countries – and especially china – have become, over the past decade, major economic players at the global level. this greater weight and influence in the world economy also entail a greater responsibility to assess the global implications of national economic policies. as i have already stressed, this is what the euro area and the united states also need to do so as to facilitate a smooth adjustment of global imbalances. the development of the chinese economy and its growing trade surplus have been spectacular. they reflect the international competitiveness and dynamism of your economy and the confidence which international investors have in its future. they have been accompanied by the accumulation of foreign exchange reserves at a pace and magnitude almost unprecedented in history. but, as walter benjamin, the german philosopher, once said about happiness, could this be “ too much of a good thing ”? this depends on the underlying causes of reserve accumulation and on the potential risks to the sustainability of the performance of the domestic and world economies. we in europe are confident that the chinese

assigning clear responsibilities in this area to regulators, and improving financial literacy are among the issues being discussed. it is important, however, for consumer protection to form an integral part of the regulatory infrastructure in order to avoid inconsistencies among agencies and risks to depositors and overall financial stability in the name of protecting consumers. consumer protection also has a high risk of being captured by the political cycle. this could be specially damaging in the financial system – and therefore every effort should be made to make the institutions safeguarding financial consumers autonomous and technical. for macroeconomists and financial economists, today it is difficult to focus on something other than the european crisis. the health of the global economy depends on a good resolution to this crisis. however, we cannot forget the duty of building a safer and fairer financial system. today we have the opportunity to tackle this task, but we also have to avoid shortcuts that may end up rebuilding a weaker financial system. references arcand, jean - louis, enrico berkes and ugo panizza ( 2012 ), “ too much finance?, ” international monetary fund working paper, wp / 12 / 161. cecchetti, stephen and enisse kharroubi ( 2012 ), “ reassessing the impact of finance on growth, ” mimeo, bis. de gregorio, jose and pablo guidotti ( 1995 ), “ financial development and economic growth, ” world development, vol. 23, no. 3, pp. 433 – 448. diaz - alejandro, carlos ( 1985 ), “ good - bye financial repression, hello financial crash, ” journal of development economics, vol. 19, issues 1 – 2, pp. 1 – 24. dooley, michael p. and michael m. hutchison ( 2009 ), “ transmission of the u. s. subprime crisis to emerging markets : evidence on the decoupling - recoupling hypothesis, ” nber working paper 15120. korinek, anton, agustin roitman and carlos a. vegh ( 2010 ), “ decoupling and recoupling, ” american economic review, papers and proceedings, pp. 393 – 397. levine, ross ( 2006 ), “ finance and growth : theory and evidence, ” in philippe aghion and steven durlauf ( eds. ) handbook of economic growth, pp. 865 – 934, new york : elsevier north -