cooperation exemplifies what will be important in the ssm. like us supervisors, ese, too, has recently seen eventful times. last year, we saw a considerable increase in the number of seminar participants – a noteworthy success and confirmation of the excellent work by those responsible for ese. these parties include the programme council, composed of proven supervisory experts and responsible for keeping the content of the training measures up to date at all times. the steering committee and the ese secretariat naturally also play a pivotal role. at this juncture, i would like to express my sincere thanks to the representatives of ese for all that you have done to make ese one of the leading training initiatives for supervisors in europe. 4. the future let us now take a further step – forward – and venture a look into the future. now that the european parliament has approved the draft legislation, the ssm can soon be officially launched. we have a year full of hard work ahead of us. thankfully, the preparations are in progress – through the high level group of ecb and national authorities ’ representatives and the many affiliated working groups, the basic framework of the ssm has already been laid out. over the coming months, we will define the further details of the cooperation between the ecb and national supervisors and codify them in a framework regulation. we will continue our work on the organisational and operational structure of the new supervisory regime and institute an efficient reporting process. however, in my opinion, it is the balancesheet assessment which represents the greatest challenge in the months ahead of us. the ecb needs a clear picture of the actual risk faced by the banks it will be supervising. moreover, light needs to be shed on which balance - sheet burdens arose under the watch of national supervisors. we therefore need a thorough and rigorous review of balance - sheets. this will be the first test of the ssm and of cooperation between the authorities involved. though we don ’ t have much time at all to accomplish this extremely complex task, i believe that, if we act in unison, we will succeed. one year from now, the preparations will be completed and the ssm will take the helm. in order for the ssm to exploit its advantages, one thing will be paramount : a consistent supervisory approach incorporating the strengths of individual national approaches and experiences. this common supervisory approach must build on established principles such as risk - orientation, proportionality as well as an integrated micro and macroprude

hermann remsperger : the evolution of inflation measurement : a central banker's view address by professor hermann remsperger, member of the directorate of the deutsche bundesbank, at the symposium “ hedonic methods in price statistics ” held in wiesbaden, 21 june 2001. * * * i five years ago, the boskin commission reminded us that inflation measurement is anything but simple. although experts had known many of the problems for quite a long time, it took the boskin report to reawaken public awareness. this forced statistical offices – and, of course, also central banks – to sit up and take note of the situation in their countries. the boskin report prompted the bundesbank, too, to devote more attention again to the problems of inflation measurement. in the mid - sixties, the bundesbank submitted a report to the federal fiscal court in which the following opinion was reached : “ in general, it should not be considered a reduction in the value of money if the cost - of - living index rises by, say, 1 per cent per annum ; and an annual increase of between 1 and 2 per cent in the index can be regarded as indicating a deterioration in the value of money only with certain reservations. ” in the bundesbank ’ s annual derivation of its monetary target, this factor was reflected in a medium - term price assumption of 1½ to 2 % per year. in 1998, our research group arrived at the conclusion that the range of uncertainty in measuring inflation in western germany is clearly below 1 per cent. there were hardly any thorough empirical studies on that topic for germany at that time. and not very much has changed in the meantime. yet this is exactly the reason why problems with measuring german prices will remain on our research agenda. we certainly do not wish to take the easy way out by doctoring inflation figures downward, nor do we wish to overstate germany ’ s real economic performance. instead, it is our duty to run reality checks on statistical methods, and to analyse their implications for economic policy in general and their importance for monetary policy in particular. this work is also important for the calculation of real aggregates in the national accounts. in our may 2001 monthly report, we presented the results of a new study on this topic. it shows how real growth would have developed in the second half of the nineties if us methods of calculating the national accounts had been applied in germany. the quantitative outcome of hedonic