Less clear principles for policy in combination with reduced transparency regarding, for example, the reasons for making decisions, will hardly lead to a policy which will be more successful in the future. Many years' experience in the vicinity of economic policymakers suggests to me that the opposite is  4  BIS Review 38/2001  more probable. Among the most important things one can do in this type of work is to try to build up clear processes which contribute to decision data, based on good economic analyses, being produced in a systematic way. And that this decision data is subjected to as wide an examination as possible. I am convinced that our ambition to be as clear and open as possible has served us well. Starting with a numerical, symmetric objective and a guiding rule, in the way that we have done, we have been forced to think through every question with which we have been confronted in a more precise manner. This has resulted in our gradually increasing our understanding in a way which I think would hardly have been possible otherwise. Certainly it is not yet over, and in this context, future developments will place new demands on us and impose further intensification and exactitudes. There is also a connection between transparency in relation to the outside world on the one hand, and internal work on the other. In getting rid of secrecy we were able to introduce a more realistic debate on monetary policy.
If so, presumably this should be supported by other central inflation indicators, such as the overall utilisation of resources in the economy. If one is sufficiently convinced about this, there is, as I see it, an argument for taking action. But precisely as with the previous case involving deregulations, it is necessary to make a good case for deviating from the normal rule. It is also necessary to make clear what one stands to gain by acting now. This leads me to the question of what approach central banks should take to developments in asset prices which are not thought to immediately endanger price stability, but which risk leading to financial  2  BIS Review 38/2001  imbalances or real imbalances. There is no consensus on this in the academic literature. The prospect of intervening immediately poses the next question: how can we know if an asset is over-valued or not? If one does decide to act, a third question is raised: how can one burst the "bubble" in an organised way? Listing these problems is usually sufficient to make many of my colleagues in the central bank world come to the conclusion that monetary policy should not be used to try to stabilise asset prices. My own opinion on this question is, however, somewhat different. In any case, it is reasonable to put the argument in a larger perspective. Apart from price stability, the Riksbank has the objective of promoting an efficient and stable payment system.