After all, subprime mortgage-related assets accounted for only a small portion of the total financial assets of the United States and Europe leading up to the global crisis, but they nevertheless triggered the global crisis when the housing bubbles in these economies burst.
For this reason, systemic risk control should be approached from a macro-prudential perspective in which the real and financial sector linkages take center stage. And given their mandates and financial resources, central banks are arguably well positioned to develop macro-prudential judgment of systemic risk and to take actions if warranted.