indexation and life course arrangements. in this context, i foresee market opportunities for new pension products that are tailored to individuals, but maintain the benefits of collectivity. this involves both assisting individuals with complex choices and making risk pooling instruments more readily available. peter bronkhorst having stated these messages, i finally turn to today ’ s overarching theme : peter bronkhorst ’ s retirement. from my story, one may infer that i believe that a good asset manager should be both prudent and astute. peter bronkhorst possesses both these characteristics. this is also reflected in the performance of shell ’ s pension fund. during peter ’ s period of office, shell ’ s pension fund portfolio out - performed that of most other dutch pension funds : as noted in its yearly report, shell ’ s pension portfolio earned an average annual rate of return of 6. 8 percent over the period from 2001 to 2005, when peter led the predecessor of samco, as compared to 4. 5 percent for the average dutch pension fund over the same period. in peter ’ s last year, 2006, i am told that samco even realized a rate of return equal to 17 % – about 7 percentage points higher than the average dutch pension fund. that is what i would call a generous farewell gift! but peter ’ s strong track record was not only established in the upswing. in fact, peter guided shell ’ s pension portfolio through the perfect storm that hit the financial markets in 2001. peter ’ s investment policy enabled the shell pension fund to compensate its participants fully for inflation in all years he was in charge. besides this, peter deserves merits for bundling shell ’ s pension assets in the netherlands. this is favourable for the shell pension fund itself as research has shown that there are substantial economies of scale in pension fund provision. apparently, the dutch entity was the better place to deliver these economies of scale. in this context, bundling these activities in the netherlands also brings positive externalities to the dutch economy as it preserves and creates high - skilled employment in our country. in this way, it seems to me that peter has fulfilled his social mandate in an exemplary fashion. finally, one of my colleague - directors at the dutch central bank – dirk witteveen, who as pension supervisor got to know peter bronkhorst fairly well – praises peter for the binding role he fulfilled between social partners and pension funds when the sector was in disarray in the

controls is already underway in many countries including even the uk which has long been one of the most open economies for capital and ownership. it will continue unless we can convince each other that much better structures for cooperation and coordination are in place. that is an acute problem within the eu where the single market is based on a common passport. but dealing with the european problem is not the main priority since most of the biggest banks in the world are based elsewhere. i don ’ t think we should give up on this international agenda. the package of economic measures that were rolled out late last year – from coordinated cuts in interest rates, to provision of dollar liquidity and measures to support banks – showed the power and possibility of coordinated action. the programme of work on the regulatory implications of the crisis which has been coordinated by the fsf and will go in april to the g20 summit demonstrates a wide accord on the main regulatory issues. but we need more progress on implementation as well as policy. in particular we need much stronger cross border crisis planning – a subject on which i have been chairing a group under the fsf. this has been bedevilled, in practice, by the sheer lack of information and time to consult widely in the heat of a crisis. that we can do something about. i hope we will agree two things to put to the g20 summit – a statement of principles on how countries should cooperate in planning for and handling crises in cross border institutions and a programme to put in place better arrangements for information sharing and cross border dialogue on the largest banks in the world. building on the core international colleges of supervisors we would aim in peacetime to establish a shared information base among the relevant authorities and jointly to think through the implications of failure for different countries. that would at least give us the basis for considering a coordinated solution in wartime. in time we should also try to establish greater harmony on national resolution regimes which is on the basel committee ’ s agenda. lesson 4 : develop a new generation of macroeconomic models so far i have concentrated on lessons for financial policy but this recession has also set some challenges for the economics profession and cast doubts on the macroeconomic modelling. in truth, much of my critique of the models that financial institutions use to calibrate risk could equally be levelled at the workhorse dsge models that most economists and central bankers use to describe and forecast macroeconomic developments. these have a number of attractive features. it is built on sound economic principles of forward - looking