luis de guindos : banking union - achievements and challenges speech by mr luis de guindos, vice - president of the european central bank, at the highlevel conference on “ strengthening the eu ’ s central bank crisis management and deposit insurance framework : for a more resilient and efficient banking union ” organized by the european commission, 18 march 2021. * * * setting up the banking union was a crucial step in ensuring the stability of the euro area financial system and strengthening economic and monetary union ( emu ). the global financial crisis and sovereign debt crisis highlighted the need to make faster progress towards completing emu. more than a decade on, now is a good time to take stock of where we stand in the banking union : what we have achieved and what works, but also what remains to be done. with ecb banking supervision at the heart of the single supervisory mechanism, we have an authority responsible for ensuring the safety and soundness of the european banking system, promoting financial integration, and ensuring consistent supervision by fostering harmonised practices based on high supervisory standards. the single resolution mechanism continues to be strengthened, both through the build - up of the single resolution fund, which will reach its target by the end of 20231, and through the recent agreement on a backstop provided by the european stability mechanism. the implementation of these two pillars represents a milestone in european integration and a major success for financial stability. but in terms of completing the banking union we are not there yet. today, i will focus on three areas for improvement. first, the final pillar : the european deposit insurance scheme ( edis ). second, in the field of crisis management, the tools for dealing with the failure of smaller and deposit - funded banks. and third, the role of macroprudential policy and how it can help us deal with shocks to the financial system. almost six years on from the european commission ’ s first proposal on edis, deposit insurance is still at the national level and there has been little ambition to change it. this is problematic as the level of confidence in the safety of bank deposits may differ across member states. so long as deposit insurance remains at the national level, the link between a bank and its home sovereign persists. the ecb has been a staunch supporter of edis from the beginning and supports pursuing a fully fledged edis as a key priority. but we have not yet seen sufficient political will to implement this third pillar of the banking union. member

mr. rangarajan examines the objectives of monetary policy and price stability in relation to the economy of india address by the governor of the reserve bank of india, mr. c. rangarajan, at the second conference of the econometric society ’ s regional chapter for india and south asia in delhi on 28 / 12 / 96. 1. it gives me indeed very great pleasure to be in your midst this morning. it is indeed very gratifying to note that the second conference of the econometric society ’ s regional chapter for india and south east asia is being held in delhi. 2. econometrics as a discipline has come a long way. enriched by the developments both in mathematical economics and statistical methods, econometrics has today become an indispensable tool to all practitioners. without a numerical evaluation of economic magnitudes, economic theory would have been of little use in economic policy. the original motto of cowles foundation was ‘ science is measurement ’. it used to be said that in economics the tendency of theory to lag behind observations seemed to be endemic. we have definitely moved away from that situation. while alternative theories to explain a set of phenomena are not necessarily a weakness and may even be regarded as a sign of vitality, the continued co - existence of alternative theories over a substantial period of time without being able to discriminate among them can result in the loss of credibility in the discipline itself. this in part is the present status of economics. the future scope of econometrics is thus immense. 3. i would like to take this opportunity given to me this morning to raise one issue in monetary policy that still remains contentious despite overwhelming agreement among policy makers in industrially advanced countries. the issue relates to the objective of monetary policy. the question is : what should be the objective or objectives of monetary policy and whether in the indian context, maintenance of price stability should be the dominant objective of monetary policy? 4. the issue of objective has become important because of the need to provide clear guidance to monetary policy makers. indeed this aspect has assumed added significance in the context of the increasing stress on autonomy of central banks. while autonomy has to go with accountability, accountability itself requires a clear enunciation of goals. 5. monetary policy has now moved to the centre stage of economic policy - making the world over. in the 1930s and in the first two decades after the second world war, monetary policy was relegated to the background. the ascend