*  *  *  More than four years have passed since the onset of the financial crisis. Over these years, central banking functions have been stretched to the limits. Recent developments demonstrate how fragile our financial system remains, not only because of debt legacy but more worrisome because of its mere design.
The public debt crisis in a number of advanced economies is also raising fundamental questions about the role of public debt instruments in our financial system. Looking backwards, one can say that disciplining mechanisms in debt markets have clearly failed, often as a result of mutually reinforcing market and government failures.