Because in a situation where monetary policy lags behind the curve, the macroeconomic costs would be significantly higher. 4 Banks in Germany Ladies and gentlemen, what must be going through your mind right now when you, as representatives of banks, hear about the determination to resolutely normalise monetary policy? Maybe you are imagining a multi-layered risk scenario starting to unfold?
Although these instruments cannot reduce the risk inherent in real assets, they can redistribute it in a way that induces more investment in real assets and, hence, engenders higher productivity and standards of living. Information technology has made possible the creation, valuation, and exchange of these complex financial products on a global basis.