As new regulation accumulates, we know that it can come with costs as well as with benefits. Policymakers need to be watchful that, in attempting to limit externalities, they do not inadvertently create new externalities. The financial sector ultimately exists to serve the real economy.
It is very likely that there are trade-offs between ensuring financial stability and imposing such a burden on the financial sector that it ceases to be able to do its job, namely to intermediate between surplus and deficit units in any economy in order to encourage long-term investment and growth. Thus we have to develop methods to judge the appropriateness of indicators and tools.