These goals are at the heart of our entire approach to determining the appropriate level of bank capital, both from a microprudential supervision and a macroprudential standpoint. These are also at the heart of ensuring mortgage holders are better equipped to deal with any future shock.
Moreover, one point is often overlooked: secondary market purchases are a very crude and, indeed, a rather ineffective instrument for stabilising the financial markets and influencing countries’ funding conditions. Thus, much larger amounts will be needed to achieve a particular result. This increases the risk for the taxpayers of the countries providing assistance.