* * * It is my pleasure to welcome you to this joint ECB-MIT conference on fostering innovation and entrepreneurship in the euro area. This might at first glance seem an unusual topic for a central bank conference, since monetary policy principally operates through the demand side of the economy.
Clearly, financial engineering and improvements in risk management have helped the financial industry offer products to their clients to better control various business risks. At the same time, financial institutions also benefit from these innovations in that they can better manage the risks associated with increasingly complex financial instruments and the growing volume of financial transactions.