taking the necessary precautions ( to a greater or lesser extent and according to their needs ). some of them have established capital inflow controls ; others, like argentina, seek to mitigate exchange volatility, accumulating international reserves at a time when our balance sheet situation allows us to do so. chile and mexico, for instance, take the opportunity to build - up fiscal resources through the operations of state - owned exporting enterprises and the treasury. for an economy, which have suffered a severe institutional crisis and is still in transition towards its long - term cruising speed, a managed - floating regime emerges as a useful tool to mitigate these effects while advancing in the development of an adequate financial infrastructure to create conditions for resources to be efficiently channeled towards the funding of worthy investment projects and, in turn, strengthen traditional monetary policy instruments. while there were some turbulences in the recent past with no significant effects, this adjustment process towards equilibrium has not yet been tested. this requires us to implement sound and consistent policies to comprehensively protect our economies against external misalignments. in the case of argentina, this implies, for instance, providing monetary and financial policy with longterm sustainability on the basis of four main pillars – a consistent monetary policy that ensures money market equilibrium ; a countercyclical prudential approach ; a system that is independent from public sector needs ; and a policy framework that boosts credit to firms and households. the first of these pillars is largely determined by our recent history : in argentina, monetary regimes have unsuccessfully shifted from one extreme to the other. while in the 1980s money supply was rising uncontrollably in line with the monetization of the fiscal deficit, in the past decade the strictures of the convertibility regime were neither consistent with the economy ’ s flexibility nor with the fiscal behavior. what mattered was not the label of the regime, but the internal consistency of its policies. in an economy where macroeconomic variables are still seeking a long - term stability path and transmission mechanisms through credit are still limited, the current monetary policy helps us to ensure the strict and ongoing money market equilibrium. in order to preserve this equilibrium, the central bank applies a deep monetary absorption strategy coupled with foreign exchange purchases for prudential purposes. thus, it has absorbed some ars 80 billion since 2005. such a strategy has been implemented through various mechanisms that comprise the issuance of bills and notes, repo operations, the pre - payment of liquidity assistance provided to

. in fact, until not long ago, the consensus in academia on monetary policy mostly overlooked the issues related to structural change and uncertainty – as reflected, for example, in lars svensson ’ s presentation at the 1999 jackson hole symposium. this literature implicitly assumed that we, central banks, were aware of the true economic model, that we were able to correctly observe all relevant variables, and that we accurately knew the nature and sources of the various random forces affecting the economic system. in this conceptual approach, the only remaining “ uncertainty ” was actually the effective value of these stochastic disturbances. in terms of the knightian distinction between risk and uncertainty, it was, at most, a risk situation where policymakers seemed to know the random distribution within the various contingencies. they also seemed able to quantify the likelihood of the several possible events occurring, ultimately assuming that the future would replicate the past. however, in most cases central banks evidently face a quite different reality : many risks are essentially not quantifiable because quite often not only the likelihood of each individual event is unknown, but also the whole range of possible contingencies. in short, uncertainty makes monetary policy implementation an extremely hard task, even in industrial economies. in emerging countries, where institutions are still in the process of consolidation, the central banker ’ s task is even harder : the instruments have a limited power and the boundaries between the scenarios which require intervention due to market failures and those that belong to the usual turbulences in a dynamic market are not so well - defined. this is especially true for countries that have had a fixed exchange rate for decades and, for several reasons such as fiscal, financial, or external dominance, have suffered from macroeconomic instability, marked by currency substitution and the dollarization of liabilities, which have hampered monetary policy implementation. uncertainty about how the economy really works and about the true value of the parameters together with data quality and timeliness ( and, consequently, the robustness of estimates ) is an essential constraint that not only affects the central bank, but also the private sector. there is huge uncertainty about the future behavior of the main domestic variables, especially in relation to ( both goods and factors ) relative price dynamics and that of the various sectors of the economy. another important restriction is given by the difficulty in identifying the nature of shocks, especially external shocks. the world continues to tread today a path of sustained expansion in a context of stability. this pattern of growth is even healthier than