improvements in foreign exchange settlement, and enhancing the framework for resolving cross - border failures of financial institutions must not be forgotten as well. concluding remarks already forty years ago, the nobel prize - winning economist sir john r. hicks predicted that in a globalized financial market “ a national central bank will no longer be a true central bank, ” but will become “ single banks in a world - wide system. ” whether we like it or not, this is clearly the direction we are heading. bis central bankers ’ speeches

angle. the challenges for central bankers in the current ims let me move on to the challenges for central bankers in the current ims. i would like to raise three aspects. first, the implementation of macro - prudential policy. the recent global financial crisis has brought to the forefront the importance of macro - prudential policy. we have not been able to nail down its definition nor come up with a comprehensive toolkit. it may take some time before we can make it truly operational. but, we do need to recognize that it took a couple of decades before the importance of price stability for macro - economic stability was fully appreciated and became embedded in central banks ’ monetary policy framework worldwide. second, dealing with tail risks. taking preemptive action to avoid the emergence of bubbles which can seriously harm the economy means implementing measures to prevent the build - up of tail risks or occurrence of low - frequency, high - severity events. the independence and the need for a clear mandate are often emphasized as an important basis for a macroprudential authority. however, i believe that is not enough. a fundamental change in the way economic policy is perceived is called for. a collective understanding within society that it would be acceptable and appropriate for the macro - prudential authority to take away the punch bowl when conditions still seem to be benign, is necessary. this is a large change from the current policy paradigm, where measures are typically introduced after specific negative shocks occur. third, the cross - border spillover effects of policy actions. due to continuing globalization and financial innovation, the interlinkages among economies and financial markets continue to strengthen. in this environment, regardless of whether it is monetary policy or macroprudential policy, policy - makers will have to inevitably be cognizant of the cross - border implications of their policy actions. it also needs to be recognized that there will be feedback effects from overseas economies and markets which will influence domestic economic and financial conditions. forums such as the bis have played critical roles in enhancing central bank communication and cooperation over the years. their importance will increase further in such an environment. independent evaluation office of the international monetary fund. the ieo released a report titled the “ imf performance in the run - up to the financial and economic crisis : imf surveillance in 2004 – 07 ” in january 2011. bis central bankers ’ speeches i will not go into details here, but issues such as strengthening the plumbing of the financial system though, for example, further