The Bank for International Settlements (BIS), also known as the bank of central banks, was one of the few institutions that issued warnings before the onset of the global crisis in 2007.

The most powerful voice was that of William White, the chief-economist of BIS between 1995 - 2008. Unfortunately, White was "the man that nobody would listen to", like the German magazine Der Spiegel wrote in the summer of 2009, which also said that "the central bankers preferred to listen to his great rival, Alan Greenspan, instead".

Stephen Cecchetti, the successor of White as the chief economist of the BIS, recently evaluated his activity over the last five years at the annual conference of the bank of central banks, in a presentation called "Five years in the tower". Cecchetti probably referred to the "ivory tower" of theorists, who are increasingly irrelevant before the relentless assault of economic reality. It is precisely this irrelevance which has stopped him from wanting another term as chief-economist of the BIS.

Speaking of moral hazard, which is "worse than thought", Stephen Cecchetti also said that "the nature and size of the risks assumed by the financial institutions are greater than we thought", because "the fundamental issue is the divergence between the interests of banks and those of society".

The source of this conflict of interest comes from the limited liability of owners and from the increase of the leverage, which encourages risky investments. "Banks knew that by increasing their own size, they would become too big to fail", the chief economist of the BIS said.

Jaime Caruana, whose term as General Manager of the Bank of International Settlements was extended, said, during the same annual conference of the BIS, "that the relaxation of financial conditions has a limited effect on the revitalization of the economic growth, when th