##lter even before the crisis. so the financial crisis deepened the economic slowdown, but this was not the only cause. last years have also shown that the economic pillar of the maastricht emu was not robust enough. the contagion can be an especially pronounced problem in a monetary union and we need stronger framework and stronger tools to tackle it. at the same time, we need to be fair : this has not been just a crisis of politics or a crisis of the emu. the economic theory and especially the modern theory of finance have been challenged. this crisis has cast doubt on many commonly held beliefs from the last 25 years. many textbooks will be re - written. bis central bankers ’ speeches but still there are issues which we have learnt in economics and economic history which have passed the test. first : a growth model based on ever - growing debt levels won ’ t last. second : the stability of the whole economy is important, not only the control of public deficits. the economy needs to be competitive. third : an educated workforce, reliable institutions and a functioning infrastructure provide a foundation for renewing the economy. how have we changed the eu and emu? as to the emu, the economic governance has been strengthened based on the lessons learnt. first, we have now a stronger stability and growth pact ( sgp ) and the new macroeconomic imbalances procedure, which pays attention on the balanced development of the whole economy. the governance has also been improved. second, the crisis management structures have been developed and the esm has been in place since last october. third, the banking union is an important step towards further strengthening of financial stability. we have not only new rules, we have also more market discipline. we need both. true ownership of the governance is crucial. we need more europe and we need more national responsibility. a clear separation of responsibilities between brussels and the member states is very important. as regards the crisis management structures, the esm as a crisis fund is just a part – although an important part – of the story. it is of utmost importance that the design of the adjustment programmes relies on state of the art expertise, practices and experience. the programmes must be built on realistic assumptions on the macro outlook and public debt stability. this is the best way to guarantee that the financial support drawn from the esm remains a bridge loan instead of becoming a permanent transfer. i find also the role of the imf important and useful. i hope

( 3 - year - long ) refinancing operations were conducted to remove liquidity uncertainty and facilitate the function of the euro area money market. again, the final objective was to improve the transmission of the proper monetary policy. another crucial segment in the monetary policy transmission is the government bond market. partly due its size – it is the largest capital market in the euro area – it lays the foundation for price formation in other capital markets, like bank and corporate bonds. government bonds are also important repo instruments. a year ago, in spring and summer 2012, fears of a break - up of the single currency area and the associated implicit exchange rate risk led to several tensions in the euro area capital markets. as a result, the steering of monetary policy was not functioning fully, or was, in part, not functioning at all. at the same time, economic indicators pointed to a significant credit crunch and a severe decline in economic activity. as a result, there was a risk of an incipient deflationary spiral ; the primary goal of the governing council – price stability – was not ensured. against this background, the governing council set up the omt programme. there are three crucial elements in the programme. first, a necessary conditionality is to ensure that the member state remains under considerable pressure to implement reforms and maintain fiscal discipline. second, this necessary conditionality is not yet sufficient. in addition an omt transaction must be warranted from a monetary policy perspective. this decision will be made independently by the governing council of the ecb. third, the transactions will be discontinued during the quarterly efsf / esm programme evaluation period. the continuation of omt transactions requires that the programme remains on track. the omt is designed to stay strictly within the mandate of the ecb. central banks have been able to play a stabilising role first against the forces of the financial collapse and then supporting a recovery of the real economy. but the central banks cannot repair the balance sheets. they cannot consolidate the public finances. central banks cannot implement the structural reforms. everyone has to take his or her own responsibility. bis central bankers ’ speeches we need more growth. how can we achieve it? the pace of recovery in advanced economies has been disappointing. still between 2001 and 2007, they grew 2. 3 %. between 2010 and 2012 annual average was 1. 3 %. the bis report from 23 june 2013 reads : “ the only major exception is germany, which bounced back from a