I understand their position very well and I will be the first to vote in favour of further normalisation of monetary policy once the necessary conditions are in place. Our asset purchase programme ends in January.
The solution, in addition, lies with more closely tying traders' compensation to the long-run performance of their portfolios. This internalization of the costs of risk-taking toward those most capable of understanding and measuring the risks should help blunt the buildup of excessive risk and leverage. Long and complex chains present problems, importantly because of the incentive problems along the chain.