Moreover, no doubt that the available reserves serve as an insurance from the market point of view and make the access to debt financing somewhat easier. In conclusion I would like to say a few words about how to reach the path of strong economic growth amid tough monetary and fiscal policies and prudent build-up of government debt. The matter is the structure of budget expenditure, rather than its volume, and the use of structural reform potential. The external conditions push the economy towards structural changes and balanced structural reforms may accelerate this process and make it less painful. The emphasis should be put on those industries, which turned out to be competitive in the current situation without government support. Only they could become an efficient engine of development amid new reality. As it often happens, the best way to help businesses in the current conditions is not to interfere. The deficit resources of government support should be concentrated on assistance to the most vulnerable population groups, as well as on the development of infrastructure and human capital. BIS central bankers’ speeches  3
If the financial system can be made more resilient, it will be better positioned to withstand the failure of a large and complex firm and continue to provide essential financial services to the real economy. I would highlight three areas of work that are critical to solving the TBTF problem. First, regulators and supervisors are pushing for changes in wholesale funding markets, a source of particular vulnerability during the crisis. This includes reforms to tri-party repo, which are underway, and necessary reforms to the money market mutual fund industry, which are being evaluated by the Securities and Exchange Commission (SEC) and the Financial Stability Oversight Council. Second, the financial market infrastructures are being strengthened to make them more robust to the failure of individual firms. The Committee on Payments and Settlement Systems and the International Organization of Securities Commissions (IOSCO) have published a set of standards for financial market infrastructures called “Principles for Financial Market Infrastructures” that will serve as minimum standards globally. 7  The FDIC’s “single point of entry” framework for implementing this authority envisages establishing a bridge company into which all the operating subsidiaries of the parent company would be transferred. The bridge company would be recapitalized by converting all or some of the parent company’s subordinated and senior unsecured debt into fresh equity in the bridge company. The parent company would be allowed to fail.