How to emerge from the crisis in 2009

But when one takes a step back (something easier to do on days when markets are closed), the picture becomes clearer, and so do the required policies.

Let me first set the scene by making three observations on where we are today. First, in the advanced countries, we have probably seen the worst of the financial crisis. There are still land mines, from unknowable credit default swap (CDS) positions to hidden losses on balance sheets, but the worst days of frozen money markets and obscene risk spreads are probably over.