The regulatory role envisaged in this paradigm is confined to identifying the market imperfections and improvising on disclosure and transparency requirements towards efficient outcomes. Any divergence from the efficient configuration was thought to be transitory and self-correcting led by anonymous competitive forces and dissemination of information. 12.
However, to ensure that it actually works and avoids the build-up of unsustainable sovereign debt, there  4  BIS central bankers’ speeches  needs to be a much greater automatism, particularly in the Stability and Growth Pact, for imposing sanctions when the deficit and debt limits are breached.