You will hear a recording. Type the missing words in each blank.

The European Central Bank faces the (1) …………………….. challenge, because it has acted as, in effect, the (2) …………………… to euro-zone bond markets, a mechanism that otherwise the currency bloc still lacks. But the main safety valve lies elsewhere, with banks and (3) ……………………… . Bitter experience has shown that debt-funded assets can (4) …………………….. losses, causing financial crises. For this reason banks must be able to withstand any (5) …………………….. of today’s high asset prices and low defaults. That means raising bank capital in places where it is too low, especially the euro zone, and not backsliding on (6) …………………….. “stress tests” as America’s Treasury proposes. In the end, however, there may be no escape for (7) ………………………….. from the low future returns and even losses that high asset prices imply. They and regulators should take a leaf out of “The intelligent Investor”, and make sure that they have a (8) ……………………….. of safety.

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