Mr. Hollande’s plan was to achieve this by, for example, imposing a tax on financial transactions, introducing a 75-percent income tax on earnings above € million euros, and raising the corporate tax on the biggest companies to 35 percent, while reducing taxes on small and medium-sized enterprises (SMEs) and scrapping a value-added tax (VAT) increase proposed by Mr. Sarkozy.
First of all, we should seek to find the desirable role of the central bank within a macroprudential policy framework that ensures overall economic and financial stability. The crisis has taught us that, even under low and stable inflation, financial sector imbalances can accumulate through a rapid expansion of credit and sharp run-ups in asset prices, and that these can trigger crises.