In that sense, it was crucial to assess and act against the risks to the financial system as a whole. However, such a macro-prudential perspective was not well established. Revisiting the philosophy behind policy I have examined the reasons why both monetary policy and regulatory and supervisory policy were not successful in putting on the brakes.
Through such considerations, one feels afresh the strong influences of the policy philosophy of policymakers, and furthermore, of the conventional wisdom surrounding policymakers which influence their behavior. As Keynes pointed out, “sooner or later, it is ideas, not vested interests, which are dangerous for good or evil” 8.