Acute challenges  The acute challenges have been addressed, first and foremost, by establishing crisis management tools at the European level. This included the temporary European Financial Stability Facility and Mechanism in May 2010 and more recently the permanent European Stability Mechanism. Their significance cannot be overstated. Financial support can now be given swiftly and efficiently, conditional on strong macroeconomic adjustment.
This arrangement maintains the core principle that Member States are responsible for their economic policies, while at the same time removing the tail risk of a self-fulfilling  1  2  Within the Excessive Deficit Procedure of the Stability and Growth Pact. BIS central bankers’ speeches  liquidity/solvency crisis.