It just cannot be acceptable that the downside from excessive risk across the financial system as a whole falls to the general taxpayer, to households and firms throughout the economy, if the upside is enjoyed by a narrower group of shareholders and managers. This is not just an issue of economic efficiency – of the allocation of resources – and of leaning against the risk of even bigger crises down the road, but also of social justice. That is why the debate has attracted so much interest. But I hope I can persuade you that the Too Big To Fail problem matters to bankers too. Because the Lehman case demonstrates that in a democracy, political constraints are uncertain and so even Too Big To Fail firms can sometimes be allowed to fail. Banks need a system in which they are better protected against mismanagement by their peers. The debate calls for technocratic solutions to be laid out, but choice amongst those solutions should be understood and accepted by society at large. And the solution needs to be an international one. It is therefore good news that the G20 has commissioned work from the Financial Stability Board on the Too Big To Fail issue. So the stakes are high. By the lights of our successors, we are bound to get it wrong, but can we get to the right ballpark?
A similar view is substantiated in the company talks conducted by the SNB’s delegates for regional economic relations. Inflation expectations are in the range that is consistent with the SNB’s definition of price stability. Monetary policy outlook  Ladies and gentlemen, let me summarise my key points. Inflation remains very low and capacity utilisation continues to be unsatisfactory. The Swiss franc is significantly overvalued. In periods of uncertainty, it is still subject to increased upward pressure. The two elements of our monetary policy ease this pressure. The negative interest rate makes Swiss franc investments less attractive, by at least partially restoring the traditional interest rate differential against other countries. Interventions in the foreign exchange market supply the market with additional Swiss francs when demand for our currency is particularly strong. Page 3/4  Berne, 15 June 2017 Thomas Jordan  News conference  Our expansionary monetary policy remains necessary in order to ensure price stability, while taking due account of economic developments. Newly designed ‘Business cycle signals’ report  To conclude, I would like to draw your attention to an additional document in the media pack. It is the preprint of the ‘Business cycle signals’ report. The SNB’s delegates for regional economic relations regularly conduct talks with managers of companies throughout Switzerland. These talks provide us with a first-hand account of the latest cyclical and structural developments in our economy and are an extremely valuable source of information for the Governing Board in its assessment of the economic situation.