wages. that will not make it easier to find a new job. i remain sceptical about minimum wages. they are a very imprecise instrument for fighting poverty, for example, and they largely entail risks and problems for future employment trends. it is less a question of whether minimum wages will be associated with layoffs and more of whether they will prevent new hiring or – in the case of sector - specific minimum wages – unwelcome competition is crowded out. wouldn ’ t a general minimum wage then be the lesser evil? a minimum wage set by policymakers will surely tend to rise more sharply than would be called for in terms of labour market policy. this would harm precisely those whom it is bis central bankers ’ speeches intended to protect – low - skilled workers who have more difficulty than others finding work. if a general minimum wage is to be introduced anyway, i urgently propose that it be depoliticised. taking the united kingdom as a case in point : the legal minimum wage is set not by parliament or the government, but by an independent commission. are you already bracing yourself for higher taxes? that is ultimately a political decision, though the negative impacts on growth of higher taxes have to be taken into account. all in all, however, we should instead increase the incentives to work in order to counteract the age - related decline in the labour force. incentives to work for low earners, older people and secondary wage earners are possible starting points. then both the childcare supplement and the splitting of income taxation between couples ought to be abolished, since they both discourage going to work. no government has dared touch those hot potatoes. i know that those topics are both hot potatoes. however, we shouldn ’ t throw everything overboard only because it reduces the incentive to work. all of the individual programmes ultimately have social policy objectives. but it pays to at least be aware of the side - effects. the importance of these side - effects is growing in the light of globalisation and demographic change. do you truly see the opportunity for far - reaching change to occur? ever since agenda 2010, society seems to have become rather anti - change. things are naturally more difficult now because the challenges are less obvious than ten years ago. that is precisely why i am stimulating this debate. angela merkel may be many things – but not a reformer, if most voters do not want reform. i have the impression that the current chancellor, like her predecessors, is looking out for the

axel a weber : 6th bundesbank lecture welcoming remarks by professor axel a weber, president of the deutsche bundesbank, at the 6th bundesbank lecture, berlin, 4 september 2009. * * * introduction ladies and gentlemen, i am very pleased to welcome you to this year ’ s bundesbank lecture here in the very heart of berlin. i am particularly grateful that dominique strauss - kahn, managing director of the imf, will be our speaker. my special welcome to dominique and thanks for accepting our invitation. it is an honour to have you here. let me now say a few words regarding both this event and our speaker for today. on the event the bundesbank lecture series has two objectives : first, to provide a high - level forum for public debate on economic and monetary policy issues. second, to raise the bundesbank ’ s profile in the german capital. today ’ s gathering marks the 6th anniversary of the lecture series, which started in 2004. the previous speakers were : alan greenspan, jean - claude trichet, tommaso padoaschioppa, ben bernanke and mario draghi. on the subject the financial crisis has been the dominant topic for more than two years now. since the crisis intensified last september, policymakers have been fighting it on many fronts. • central banks have acted through massive interest rate cuts and an extremely largescale provision of liquidity, but also through recourse to unconventional measures. • national governments have initiated substantial fiscal stimulus packages and bank rescue measures. these extensive efforts are having stabilising effects on the financial markets and the real economy. the global recession is bottoming - out, and strains in banking and financial markets are abating. nonetheless, huge uncertainties remain. the crisis is not yet over and there will, in all likelihood, be further tests ahead. however, as forward - looking decision - makers, we are well advised to take a step back and consider the longer term as well. in this context, i would like to stress two issues : • first, we need to reform the financial market architecture to make markets more resilient and less prone to speculative exuberance. in order to achieve this, we have to use the current political momentum. • second, credible exit strategies will be needed at the right moment all around the globe. both issues represent important preconditions for a return to sustainable growth and price stability. the issue of credible exit strategies includes winding down