With low fiscal multipliers, too large policy-induced changes in expenditure or revenues would be needed to dampen the cycle. The required budget surplus to offset the private imbalances in the euro area would have been totally unrealistic and unfeasible.
This means in particular that the risk management function needs to receive a more prominent role in the organizational structure, specifically with respect to authority and independence. Regulating markets and infrastructures Concerning the regulation of financial markets, the crisis has clearly shown that turbulences in one segment of financial markets can create spill-overs and contagion to other segments.