The costs of the crisis are staggering. Our current efforts will affect the future magnitude and duration of its legacy costs. The challenges could not be more demanding. We have to remove incentives for moral hazard and ensure that financial market participants are accountable for their decisions.
We must not add new incentives for moral hazard by creating an “emergency fund” for banks, financed or co-financed by taxpayers’ money. Now is the time to act; to ensure that financial institutions can never again hold hostage the economic well-being of people who had no part in those institutions’ irresponsible business decisions. Thank you for your attention. BIS Review 146/2009  5