Norges Bank’s instruments are effective in terms of rapidly supplying large quantities of liquidity if this should prove necessary. The central bank will supply sufficient liquidity to the money market in connection with the year 2000, as we normally do throughout the year. Should it prove necessary to depart from the collateral requirement, a risk premium will be applied. 8. Conclusion  To sum up and conclude: Norges Bank places emphasis on promoting financial stability. As a result of the banking crisis, Norges Bank has strengthened its surveillance of the financial sector. In cooperation with other public authorities in Norway and internationally, we will contribute to developing framework conditions for financial institutions and financial markets that reduce the likelihood of future crises. A priority task is to enhance the resilience of the payment and settlement system in the face of a crisis situation. 7  BIS Review 124/1999  It is still likely that financial crises will recur. In the last 20 years, three quarters of IMF member countries have experienced a banking crisis. Not even a perfectly healthy macroeconomic policy and the development of an effective supervisory system constitute a guarantee against crises if the banks fail to exercise sound banking. Herd mentality and over-optimism that are rapidly reversed seem to be a recurrent phenomenon. Systems and contingency schemes are therefore required to handle crises in order to limit the adverse effects and reduce the risk of recurrence. The most important preventive measure is to promote sound banking.
Our goal is to provide information that helps households and businesses follow the data along with the Fed. If people know more about how the economy is performing and how that is likely to influence our actions, this should make it easier for us to achieve our twin objectives. I will now turn it over to Rob to discuss the Snapshot in greater detail. 2  BIS central bankers’ speeches