But one could also say this comes with transparency – outside observers were very aware of the discussions that were being held and the uncertainties involved. Inflation targeting so far has proved to be a successful way of conducting monetary policy, but there are unresolved issues and one concerns the treatment of house and other asset prices; it has been hard to formally fit asset price developments into the frameworks researchers and central banks use when they study inflation targeting. The models currently available to us and other policy makers, while indispensable as tools for organizing our thoughts concerning difficult matters, are incomplete representations of complex economies and cannot be the sole input into our analysis. Thus, while the academic community and researchers at central banks – including Sveriges Riksbank – continue their efforts to formulate models that combine firm founding in economic theory with good empirical properties, policy makers have to use judgement and take into account those relationships that history and experience suggest are of importance. In my view it is well worth keeping an eye on house prices and other asset prices and passing judgement on the risks that their developments may give rise to. If the probability of very negative outcomes can be reduced ex ante I believe this to be a good thing and a better solution compared to picking up the pieces ex post. 6  BIS Review 96/2007
Lucas Papademos: Eurosystem and Bank of Russia cooperation programme Introductory statement by Mr Lucas Papademos, Vice President of the European Central Bank, on the occasion of launching the Eurosystem and Bank of Russia cooperation programme on banking supervision and internal audit, Moscow, 20 March 2008. *  *  *  It is a pleasure for me to be here in Moscow today, together with my esteemed colleague First Deputy Chairman Melikyan of the Central Bank of the Russian Federation and His Excellency Ambassador Marc Franco, Head of the Delegation of the European Commission to Russia. I would first like to thank First Deputy Chairman Melikyan for his kind opening remarks and all those who have contributed to the organisation of this ceremony. I would also like to greet the representatives of the eight national central banks of the Eurosystem who accompany me here today, marking their strong institutional commitment to and support for this cooperation programme: the Deutsche Bundesbank, the Bank of Greece, the Banco de España, the Banca d’Italia, the Banque de France, De Nederlandsche Bank, the Oesterreichische Nationalbank and the Suomen Pankki-Finlands Bank. Today, we are taking a further step that advances the increasingly close cooperation between the Bank of Russia and the Eurosystem, by signing a protocol which accompanies the contract for the Eurosystem cooperation programme with the Bank of Russia that was signed by Ambassador Franco earlier today.