Pearse Doherty (Donegal South West, Sinn Fein) | Oireachtas source

Given Mr. Carrigan's continued reference to these instruments being low-risk, I do not expect him to go as far as the Nobel Laureate, Paul Krugman, who said that the run on the shadow banking system at that time was at the core of the financial crisis, but will he acknowledge that it had a serious impact not just in the United States, where Lehman Brothers was not able to pay out in the dollar in terms of this fund, but also on Irish banks? Therefore, when we talk about low risk, we have to acknowledge that the impact of not having substantial capital buffers in the past caused a massive risk, because liquidity dried up across the globe at that time. We were in a liquidity crisis for quite a period, which denied money not just to the financial institutions but to the economy, resulting in job losses and lack of investment. When we talk about low risk, does Mr. Carrigan acknowledge that we are talking not just about risk in investments but about risk in the shadow banking system? That is why we need appropriate regulation. One of the regulations that the European Commission believes is appropriate is capital buffers.