The contribution of FSA in setting the terms of the debate in the aftermath of the crisis has been very significant and crucial. The clarity, conviction and clinical sharpness of arguments one encounters while reading the Turner review ask of us a very fundamental question – how could the world not have expected this crisis?
The first challenge, of course, is the fact that in the current environment, inflation is persistently low, and no one knows exactly why… Different possible explanations for this phenomenon have been put forward, of which I would like to mention four: 1. We now see a weaker relationship between real economic activity and inflation than in the past. 2.