It's hard now to imagine that we had no formal banking supervision at all in this country until about twenty years ago. But for the most part such regulation today does not tell us what we can and cannot do, rather it sets the criteria that we must meet, and the behavioural standards we are expected to observe, in doing whatever it is that we choose to do. It leaves much more room for both consumer and producer choice, including producers from overseas, and much more room, and more incentive, therefore for competition and innovation. And, in that less prescriptive, more permissive, environment, the new technologies have brought about massive changes in traded instruments, in the way in which markets operate and are organised and in payments, settlements and delivery arrangements and so on, which, while not without occasional problems, have overwhelmingly on balance brought massive benefits in terms of market efficiency. In reflecting on this whole process in the UK, there are a number of characteristics of the general approach that I think have been important. The first relates to the extent to which it was market-driven. No attempt was made as far as I am aware - certainly not by the Bank - to tell market players what they should do individually or in organising themselves collectively.
Last but not least, the changes to the euro area governance framework for solving the deficiencies highlighted by the crisis need to stand the test of applicability. Only one year ago, Professor Issing insisted that the euro area prosperity was conditional on the observance of the rules of the club by its members. The turn that the Greek crisis has taken is relevant for the effectiveness of the new institutional architecture of the euro area. Unfortunately, the expectations that the Riga Summit should bring us closer to an orderly resolution have not been confirmed. IV. Should we be concerned, should we think positively or should we use our sense of humour? Currently, the debates over the present and future of the euro area are dominated by the assessment of the situation in Greece. For us, as EU members having not yet joined the euro area, these debates also raise the question of whether we should be very much concerned or take a positive, constructive approach. Although the trials and tribulations caused by the situation in Greece have often been described as a conflict between two totally different mentalities – namely, the Teutonic strictness versus the Levantine easygoingness – my view is that it is an overstatement, just like any generality.