crisis has strengthened the common currency along a number of dimensions. first, the european stability mechanism stabilises sovereign debt markets by providing an official funding reserve option ( subject to conditionality ). second, the ecb ’ s outright monetary transactions ( omt ) programme has clarified the commitment of the ecb to rule out redenomination risk for countries that demonstrate commitment to fiscal solvency. third, the development of a common supervisory approach to financial regulation – which is hardwired in banking through the single supervisory mechanism – serves to reduce the risk of national policy errors in the oversight of the financial system. fourth, the introduction of improved recovery and resolution frameworks ( including the operation of the single resolution mechanism ) helps to reduce the risk that individual bank failures trigger a system - wide crisis. fifth, the activation of national macroprudential policy frameworks ( typically absent or weak before the crisis ) is necessary to mitigate cyclical financial risks. sixth, the strengthening of the european fiscal framework is a necessary precondition for greater cross - border integration, in view of the close relationship between fiscal stability and financial stability. looking to the future, the completion of banking union and capital markets union can further help to mitigate national macroeconomic shocks. first, banking union and capital markets union may facilitate more diversified international ownership of bank equity and contingent debt instruments, such that the costs of distressed banks are not solely concentrated in the domestic economy. second, banking union may lead to more geographically - diversified financial institutions, such that local shocks do not undermine the viability of banking operations. indeed, the us experience is that the liberalisation of cross - state banking has dampened the amplification of regional shocks. accordingly, my perspective on the implications of globalisation for macro - financial stability is that europe has addressed the triple trilemmas by recognising that the internationalisation of policymaking can go a long way in reconciling integration with monetary stability and financial stability. in line with the political economy trilemma, this has required the parallel development of eu - level and inter - governmental institutions that can ensure that policymakers are democratically accountable. as is well understood, it follows that the future evolution of the euro area and the european financial system turns just as much on european political dynamics as on the technocratic debate about the relative merits of further economic and financial integration. conclusions in this lecture, i have tackled two dimensions of the implications of globalisation for macrofinancial

and mcquade 2014 ). such a metric would have raised a red flag about irish external debt by the first quarter of 2004 and peaked at 44 percent in the third quarter of 2008. the irish retail banks held net external debt assets of around 16 percent at the end of 2017, such that current international balance sheet risk is low. in similar fashion, galstyan ( 2018 ) strips out the foreign assets and foreign liabilities of externally - orientated and externally - owned entities from the irish international investment position data. the outcome of this exercise is a far smaller international balance sheet, this is a transformation of the threshold for net external debt liabilities estimated by catao and milesi - ferretti ( 2014 ). which more accurately represents the external exposures of irish households and irishdomiciled entities. in line with the recommendations of the economic statistics review group ( esrg ) that was formed to address the impact of globalisation on the measured national accounts, the cso now produces supplementary national accounts estimates in the forms of adjusted gross national income ( gni * ) and an adjusted current account balance ( ca * ). the two main forces driving these adjustments are the mobility of ip assets and the ability of firms to redomicile ( that is, change headquarters ) across countries. the underlying principle is that activity taking place elsewhere should only have minimal impact on the measurement of the irish national accounts. in the case of mobile ip assets, a decision by a firm to transfer these assets from a legal entity in some other location to a legal entity resident in ireland should only matter for irish activity data if it is associated with a change in production patterns. in contrast, if these ip assets are primarily deployed elsewhere ( with the irish legal entity charging royalties to the overseas production facility ), it would be highly misleading to include the depreciation charge on the ip assets in the irish national accounts. 3 in relation to a firm that re - domiciles into ireland, this should have no impact on the allocation of the profits earned by this firm if there is no associated change in the shareholder register. however, due to a quirk in the differences in the treatment of corporate income across the direct investment and portfolio equity components of the balance of payments, re - domiciles are not neutral in the standard accounts, such that the correction introduced by the cso is required. taken together, these corrections make a big difference. the 2017 data show that gdp is 62 percent ahead of gni *