In the implementation of macroprudential supervision, I believe it will be similarly advantageous to put in place a system of controls in which fixed rules play an important role while a place is preserved for the discretionary judgments of regulators. Fixed rules will  9  See Duffie and others, “Policy Perspectives”, in note 5, for a discussion of these issues.
diminish the need for policymakers to make the difficult decision to take away the punch bowl. Moreover, if discretionary macroprudential policy interventions are deferred until a boom is well under way, the macroeconomic spillovers could prove difficult for monetary policy to offset.