Professor Philip Lane:

That is an interesting point. It is the "compared to what" situation. On the role of the global finance system, there is a risk factor, but there is also a lot of insulation. Previously, we had the worst combination, namely, that while there were foreign owned banks, a huge amount of the credit was provided by the domestic banks and that put the domestic system at risk. Having a system where more and more of the finance in the Irish property system has an external risk attached to it makes it less risky. It is a question of if there were a downturn here, who would bear the losses. Increasingly, they are being loaded onto global investors who are better placed to take them. They would not remain here, which is welcome. Having openness to the global financial system has risk factors but also important benefits. In any case, it is not a choice; we are part of it and it is a question of managing it.