“Effective macroprudential policy requires strong communication. But communicating about financial stability is always extremely challenging. First, communicating on risks to financial stability can, in extreme cases, trigger a panic, if not done with prudence. Second, the longer a policy is successful, the less people are willing to believe they should bear the necessary costs. In other words, unlike inflation or growth, there is no simple, transparent and observable measure of financial stability beyond the absence of instability. This means that the public and their elected representatives will balk when asked to pay the price in the form of perceived increases in costs and limits on credit to households and firms, or increased costs of transactions in financial markets, among other things. Nevertheless, these policies are essential. And in a democratic society, it is incumbent upon policymakers to explain them”.
Junta Europea de Riesgo Sistémico, “Building on a decade of success”, 18 de diciembre de 2024, pág. 28.
