As Blinder graphically puts it, ‘central bankers must steadfastly resist such whimsy and inoculate themselves against the faddish behaviour that so often dominates markets. That may be why central bankers are not much fun at parties’. Finally, he argues that market traders tend to have much shorter time horizons than central bankers.
This framework provides an appropriate institutional set-up to achieve both a more flexible regulatory process and consistent supervision for integrated financial markets. This conviction has been substantially reinforced by the good experience gained so far in the securities field. Therefore, I have confidence that the extension of the Lamfalussy framework to the banking and insurance sectors will reveal the same positive experience.