They would probably result in further reinforcement of fluctuations, as activity - and thus liquidity - on the markets would decline. As representative of a central bank, I would also like to point out that nor do I believe that monetary policy alone can counteract exaggerated movements on the financial markets. On the other hand, a clear monetary policy, aimed at price stability, is necessary in the work on maintaining financial stability. It facilitates economic decision-making in society. However, part of the solution must lie in breaking the pattern that causes players to behave in exactly the same way as one another. Increased transparency with regard to countries' and companies' economic status is an important step in the right direction here. Developments in technology have demolished many of the barriers that previously hampered the spread of this type of information. However, this requires that authorities and companies make use of the opportunity and actually release important information. We at the Riksbank, like many other Swedish authorities, have for quite some time now made use of the advantages of the Internet in this context. All important information is published on our website, which is easily accessible to most people. This applies regardless of whether one is an analyst at a major bank or whether one is a private person. Information technology has thus created a powerful instrument, which can be used to counteract the 'follow the leader' behaviour.
I shall not go into this work in any great depth here. Instead, I will discuss some factors that could contribute to strengthening movements on the financial markets in an unhealthy manner, and where we need to find other solutions to improve the functioning of the markets. These factors can also be more directly connected with mutual fund investment. Short-term evaluation and “follow the leader” behaviour The first thing that comes to mind here is the way many of the operations on the financial markets are evaluated. All too often the focus is on the short-term result. This applies in particular to the evaluation of various securities funds. Although many of you manage long-term savings that people intend to live on after retirement, you are nevertheless evaluated on the results you have achieved over the past year, the past few months or even the past few days. We have all seen the newspaper headlines declaring the winners and losers in mutual fund investment. Media coverage of developments on the financial markets certainly plays an important role for the transparency of these markets, but the focus on short-term results can create a vicious circle where investors and companies are constantly chasing the best possible result in the short term, despite the fact that this is not a good long-term strategy. Such behaviour can reinforce financial crises; for instance, through a fund manager not being given scope to wait until the crisis has abated, which could be rational in a long-term perspective.