Looking forward, the envisaged actions by public authorities and the private sector, in line with the proposals of the Financial Stability Forum and the ECOFIN Council policy roadmap, aim at addressing the consequences of the turmoil by restoring confidence and strengthening the resilience of the financial system. And very good progress is being made in implementing the envisaged actions.
But the answer to the first question I posed is also essential, for we can all agree that, in principle and in general, prevention is better than cure. The issue has been recently debated again and policy-makers and academic economists have expressed different views. So can and should monetary policy prevent – or at least contain – asset price bubbles?