- 3-yearr tenders firmed feedback loop btw banks/states
- Must not overburden monetary policy
- Crisis blurred boundaries between monpol/fiscal pol
- Monpol intervention may delay governmnt reforms
- Control and liability must be kept in balance in EMU
- Bailouts have increased joint liability, not control
- Must target exaggerations before they threaten stab.
- Single supervisor can help prevent future crises
- Must risk-weight sovereign bonds in bank capital
- Should limit bank exposure to individual sovereigns