Our purpose here is to explain what led to the current crisis, and which conclusions can be drawn from it. We describe the instruments fostering the instability of the fi nancial system and show how the collapse of the fi nancial system was eventually triggered. We then comment on the diff erent possible means of government intervention. Th ese short-term actions intend to limit the acute damage to the fi nancial system. Th e crisis also calls for improved regulation. We suggest areas, which appear particularly relevant to long-run government intervention.