Similarly, the technology used to control and manage inventories has changed substantially over the past twenty or thirty years. This may have enabled companies to run down their stocks earlier in this recession than in previous downturns. And indeed there is evidence that firms have already cut back aggressively on their stock levels. A corollary of this sharp correction is that the stock cycle may be shorter lived than in previous recessions. The behaviour of the labour market may also have changed. I have been struck by the number of business people who tell me about the array of measures they have already taken since their orders starting falling sharply last autumn. Wages have been frozen or even cut,  BIS Review 46/2009  3  hours have been reduced, working practices have been adjusted. To the extent that wages and hours are now more flexible, the adjustment in employment may be less. But if it is easier for companies to vary their labour force than in the past, much of this adjustment may come through more quickly than in previous downturns. It is hard to know at this stage how significant these structural changes will be in determining the depth of the recession and the speed of the recovery. But the possibility that there has been a material structural change in our economy highlights a further danger of viewing the current recession through the prism of previous ones.
As a result of the Maastricht convergence criteria, the central banks of these countries were increasingly aligning themselves with the Bundesbank. Exchange rates between the affected currencies, as well as exchange rates to the Swiss franc, consequently stabilised. This phase of low exchange rate volatility continued in the years immediately following the launch of the euro. The most recent period of exchange rate volatility against the euro has its roots in the international financial and debt crisis, which rapidly evolved into a euro crisis. Doubts about the viability of some euro area member states’ sovereign debts caused markets to lose confidence in the euro. As in past crises, the mounting uncertainty triggered substantial upward pressure on the Swiss franc. Why Switzerland doesn’t have the euro Considering its close economic ties to the euro area, why didn’t Switzerland ever seriously contemplate joining the single currency? Politically and legally speaking, the answer is simple: a country can only join the Eurosystem if it is already an EU member state. Swiss voters and cantons rejected accession to the European Economic Area in a referendum in 1992, and in 2001 followed this up by voting against a popular initiative favouring a “Yes to Europe”. These decisions settled the question of whether Switzerland should join the EU for the foreseeable future. Quite apart from these political and legal factors, the economic case for joining the euro had always been weaker for Switzerland than for many other European countries.