a key ingredient of the subsequent sovereign debt crisis. we should never forget that this crisis severely hit countries such as ireland and spain, which had been following prudent fiscal policies. ii. what's next? let me refer once more to our geneva report, which itself was quoting arthur okun and james tobin. according to them, the task for the policy mix today would be to come back to the " middle of the road " in order to recover room for manoeuvre and to navigate in better - charted territory. this means reducing both the size of the ecb's balance sheet and the debt - to - gdp ratios of governments – which will take time. meanwhile, we need to reconsider our toolbox. the good news is that since 2010 we have had a new stabilisation instrument in our toolbox, namely macroprudential policy. macroprudential policies were introduced in the euro area as a response to the global financial crisis, in order to mitigate financial instability, and above all to reduce the vulnerability of the economy to financial cycles and instability. today, most european countries have a counter - cyclical capital buffer ( ccyb ) of at least 1 %. this means that, in the event of a credit crunch, macroprudential authorities can suddenly increase banks'capacity to lend, by simply lowering the ccyb. even more importantly, borrower - based measures were imposed on mortgages during the 2 / 4 bis - central bankers'speeches era of loose monetary policy. today, this reduces the scope for a negative feedback loop between higher interest rates, declining house prices, credit defaults and the economy. in a sense, macroprudential policies are alleviating today's constraints on monetary and fiscal policies. the fact that we have not suffered a financial crisis over the last decade, even after the turmoil in the united states and in switzerland a year ago, also validates the impressive efforts carried out over this period to re - regulate and reinforce capital and liquidity buffers in euro area banking system. it is never easy to prove why a crisis did not happen. it is even more difficult to share such great achievement with the general public, but we should not be too modest.. we have been less successful in terms of completing the banking union and progress on the capital markets union ( cmu ), yet research has shown that capital mobility is a powerful tool for macroeconomic risk sharing in the united states

out that “ it ’ s not the main thing of the report ”. viii but shared private funding, through the savings and investment union, is of the essence. as emphasised by gita gopinath, first deputy managing director of the imf, most governments need to undertake a “ strategic pivot ” ix and focus their efforts on structural policies to meet the major challenges of growth in the coming years. 3 ) “ central banks should only talk about monetary policy ” should central banks only talk about monetary policy? actually not, for several reasons. in europe – including at the bundesbank and the banque de france –, there is a long tradition of central banks freely providing their expertise on economic topics other than those strictly related to inflation or interest rates. thanks to the deutsche bundesbank, independence is a german heritage, which i cherish, and it is a great chance to have central banks ’ independent expertise. in today ’ s world where supply shocks are decisive and will be more and more frequent, x promoting structural policies is still more essential and in the interest of price stability. as central bankers, we are not the decision - makers here, this is up to governments. but it is our duty to help keep supply - side reforms at centre stage, all the more so since political authorities are at present often weakened, as they are unfortunately more subject to strong short - term and domestic pressures. central banks have built their credibility on monetary policy through decades of tenacious action and communication. they must now sometimes use this credibility to call beyond monetary policy, as price stability and financial stability will also depend on broader economic levers. if we do not defend open trade, with fair rules, who will? or if we do not plead for more financial integration in europe, who will? * * * this is why joachim nagel and i want to issue now, here in frankfurt, a common call. by doing so, we also echo konrad adenauer, who was chancellor from 1949 to 1963 : “ when everybody else thinks it ’ s the end, we have to begin ”. thank you for your attention. international monetary fund, world economic outlook, 22 october 2024 : in the euro area, gdp per capita growth is expected at 0. 5 % in 2024 and 1 % in 2025, compared with 2. 3 % and 1. 7 % respectively on the other side of the atlantic ii monetary policy decisions, ecb press release, 17 october 2024.