Since 9 August 2007, we at the ECB realised that we were facing a very serious situation and drew all the lessons for such events not to be repeated. The same experiences lead me to think that crisis management is essential and that it requires a lucid diagnosis as well as the ability to act not only wisely and decisively but also in a quick fashion whenever and wherever it is necessary. These are times where quick decisions are indispensable because the adverse consequences of a delayed – albeit right – decision may be considerable. Central banks, on both sides of the Atlantic, have in my opinion been lucid in their judgement of the situation, bold in their decisions and quick to take these audacious actions. Let me only mention yesterday’s decision to provide broad access to liquidity and funding in dollars. We are doing – and will continue to do – everything that is necessary to supply the requisite liquidity while preserving the solid anchoring of inflation expectations. However, we cannot, and should not, assume the role of executive branches. It is time for all of us to take action – private sector as well as public authorities – at the global level. From this standpoint, I am impressed by the concision of the Plan of Action that I signed, together with Ben Bernanke, Ministers and Governors of the G7 in Washington last Friday. This unusually concise five point plan shows that this is time for immediate action and not for eloquent rhetoric.
William C Dudley: Is the active use of macroprudential tools institutionally realistic? Panel remarks by Mr William C Dudley, President and Chief Executive Officer of the Federal Reserve Bank of New York, at the “Macroprudential Monetary Policy”, 59th Economic Conference of the Federal Reserve Bank of Boston, Boston, Massachusetts, 3 October 2015. *  *  *  It is a pleasure to be here today and to have the opportunity to talk about the potential use of macroprudential tools in the United States. Before I respond to Adam Posen, I’d like to make a few general comments on macroprudential tools. I am interested in such tools both as a U.S. policymaker and in my role as chair of the Committee on the Global Financial System of the Bank for International Settlements (BIS), a body that has done considerable work in this area in recent years. What I have to say today represents my own views and not necessarily those of the Federal Reserve System.1 The use of macroprudential tools has gotten considerable attention for several reasons. Some countries have implemented macroprudential measures with respect to the housing market that may have limited the extent of home price appreciation and made their financial systems more resilient when the boom unwound. Other countries have implemented countercyclical capital requirements that have made their banking systems more resilient. Thus, the hope is that U.S. policymakers can learn from these international experiences and incorporate effective macroprudential tools into our toolkit that could be used to limit financial stability risks.