Should we put some of the tools we used in the crisis near the top of our toolbox where we can easily reach them? Or should we bury them and only dig them out again in the event of a severe crisis? And should we redefine our target? The debate on these issues, in academic and policy circles alike, has been lively.
We have identified many of the perverse incentives that encouraged excessive risk-taking – in banks’ executive compensation systems, in the role of rating agencies and in the accounting rules – and begun to rectify them. But much still remains to be done.