They thereby underplay the risk of adding an additional layer of policymaking between monetary policy and prudential supervision that might affect our reputation and accountability from both angles, especially when we concentrate on instruments with no clear governance framework in place.
Current discussion on additional macroprudential tools are based on a simplistic belief that recessions can only be addressed with additional credit, with no thought given to the distribution of credit, and on the idea that all crises can be solved with supply-side measures.