would reduce the still - very - high borrowing costs faced by greek firms while encouraging banks to begin lending to the real economy. initiatives at the eu level what about the policy responses to the crisis? they have included actions in both the ecb ’ s monetary policy and in emu ’ s architecture. the actions of the ecb have been decisive. the ecb has kept policy rates at historically - low levels ; it has satisfied the liquidity needs of banks, and has expanded its collateral framework. the announcement of outright monetary transactions – the omt – has helped reduce tail risks of a euro break - up. furthermore, under its forward guidance the ecb has made it clear that policy rates will be kept at present or lower levels for an extended period of time. changes in the architecture include both improvements in macroeconomic surveillance and efforts to establish a banking union. economic governance has been improved through three main pillars : the so - called “ sixpack ”, the fiscal compact, and the “ two - pack ”. these pillars involve stronger macroeconomic surveillance designed to identify imbalances earlier, monitor them effectively, and thus ensure their timely correction. these measures should go a long way to preventing the buildup of the large imbalances that were present before the crisis. banking union is being designed to break the negative feedback loops between banks and the sovereign, as well as to create an integrated, stable and well - capitalised banking sector. the single supervisory mechanism, which will become fully operational this november, will lead to the transfer of the supervision of almost 85 per cent of total euro - area bank assets to the ecb. a necessary complement to a supervisory mechanism is a resolution framework to deal with non - viable banks. our experience with the successful resolution of 12 banks in greece has shown that resolution mechanisms need efficient decision - making procedures, allowing resolutions to be done within a weekend, in order to safeguard financial stability. resolution will also need a credible back - stop. the fund envisaged will be built up by contributions over a maximum 10 - year period. i favour a shorter period to ensure that a credible backstop will be available sooner. finally, the harmonisation of deposit guarantee schemes will help prevent the emigration of funds in search of higher coverage. the scheme will begin operation in january 2016. bis central bankers ’ speeches concluding remarks i would like to offer some concluding remarks. for too long, the countries at the euro ’ s periphery sacrificed long - term gains for short - term gr

mr. greenspan comments on the current direction of the us economy and the fiscal situation in the united states testimony by the chairman of the board of the us federal reserve system, mr. alan greenspan, before the committee on the budget of the us senate on 29 / 1 / 98. mr. chairman and members of the committee, in just a few weeks, the federal reserve board will submit its semiannual report on monetary policy to the congress. that report, and my accompanying testimony, will give a detailed assessment of the outlook for the us. economy and the implications for monetary policy. this morning, i would like to direct most of my comments to the fiscal situation. but let me begin by offering a few observations about the current direction of the economy. first, it is clear that the u. s. economy has been exceptionally healthy, with robust gains in output, employment, and income. at the same time, inflation has remained low - indeed, declining by most measures - - over the past year. second, to date, we have as yet experienced only the peripheral winds of the asian crisis. but before spring is over, the abrupt current - account adjustments that financial difficulties are forcing upon several of our asian trading partners will be showing through here in reductions in demand for our exports and intensified competition from imports. all of this suggests that the growth of economic activity in this country will moderate from the recent brisk pace. third, as i ’ ve noted previously, such a moderation would appear helpful at this juncture. the growth of output has caused employment to rise much faster than the working - age population and there are limits to how far this can go. pressures in the labor market likely contributed to the acceleration of wages in recent months. since price inflation has been minimal and domestic profit margins firm, productivity appears to have accelerated sufficiently last year to damp increases in unit labor costs. how long that pattern can continue is still an unresolved issue. the likelihood that we shall be seeing some lower prices on imported goods as a result of the difficulties in asia may afford some breathing room from inflation pressures. but they will not permanently suppress the risks inherent in tightened labor markets. conversely, a continuation of the asian crisis should give us pause in assuming that our economy will remain robust indefinitely. as a consequence, we must be vigilant to the re - emergence of destabilizing influences - - both higher inflation, and shortfalls in demand and decreases in some prices that would press the