point to participation. emu is one important component of the eu cooperation in which sweden is now taking part. from the debate about economic aspects of emu one sometimes gets the impression that an alternative exists which is much simpler, enabling us to avoid all the adjustments which brussels imposes. that is not the case. sweden has experienced a profound economic crisis in the 1990s that was essentially self - inflicted. development in the rest of europe has on the whole been better. we must now in any event continue to consolidate government finance and establish long - term confidence in the stability of swedish economy. this will scarcely be easier outside emu. i find it hard to envisage that sweden would ultimately want to remain outside a functional emu. bit by bit the countries of europe will grow together. this makes the question not whether but when sweden ought to join. perhaps this perspective can help to make the question less dramatic. in our efforts to prepare the financial sector for emu we can see that the work has come a long way. we also meet a strong desire from the parties concerned to get going as quickly as possible so as not to fall behind ; so as to compete on the same terms as other european enterprises and not lose business opportunities. my own experience of eu cooperation prompts the same conclusion. as a “ free rider ” alongside emu it is not just business opportunities that we lose but also influence on european cooperation.

effective crisis management. i am going to give you some examples of what i see as good crisis management, but i will also show the detrimental outcome that may result when these core principles are violated. in addition, i will also touch upon how regulation may facilitate – but sometimes also hinder – the application of these crisis management principles. one of the lessons i have learnt is that resolving a financial crisis takes time. it is a messy process and it costs a lot of money. therefore, to handle a crisis effectively and minimise its detrimental effects on the overall economy, you need to stick to three basic principles : firstly, cooperate ; secondly, act swiftly ; and thirdly, be economically savvy. this holds true regardless of what caused the crisis, and regardless of the solution. let me explain to you in more detail, starting with the first principle. principle 1 : cooperate without cooperation between central banks, supervisory authorities and finance ministries, there is no such thing as effective crisis management. there are several examples of situations in which inadequate or failed cooperation has resulted in a deepened and prolonged crisis. in fact, we recently experienced such a cooperation failure in my country, with the situation concerning swedish banks operating in the baltic countries. we, at the central bank, saw the build up of risk as problematic and believed that remedial measures should be applied. we also pointed to these problems in our financial stability report. in retrospect, we should have been clearer, especially regarding the potential consequences of these problems. but more importantly, we failed to reach agreement on this with the authorities in the baltic countries and with our own swedish supervisory authority ( as you may know, we have a separate supervisory authority – in contrast to spain, where supervision is undertaken under the umbrella of the central bank ). i am not pointing a finger at any particular authority in any particular country – let me be clear about that. but i firmly believe that if we had cooperated better, our countries would probably not have been as severely affected by the global repercussions of the credit crunch. to avoid this kind of cooperation failure, you need a clear division of roles and responsibilities. you need to share information and coordinate your actions. and to manage a crisis effectively, you need to be prepared. this requires planning ahead. by establishing, in normal times, what is usually referred to as a domestic standing group – bringing together the supervisory authority, the central bank, the finance ministry and perhaps certain other relevant authorities – you