The conduct of policy needs to adopt a medium-term  BIS Review 46/2004  7  focus, and possibly more so than in the past. The economy’s heightened short-term stability and flexibility quite possibly delays the consequences of inappropriate policy settings. But it surely does not eliminate them.
First, there is consensus on one of the points mentioned earlier, namely the need to strengthen financial institutions’ resilience; the capital and liquidity buffers for weathering crises have to be increased. More robust capital and liquidity requirements as well as an improved measurement of exposures to risks are also necessary so that risks arising from excessive leverage can be better controlled in the future.