Indeed, more than any other advanced economy, the euro area has experienced how quickly trust in the sustainability of public debt can form and then transform, and with it perceptions of “creditworthiness”. In our case, it has shifted from one pole to the other. Public debt has been seen as both too safe and too risky. Too safe, because the widespread belief before the crisis that the debt of different euro area sovereigns was interchangeable fuelled an unwarranted spread compression and contributed to major financial and macroeconomic imbalances. And too risky, because the rapid unwinding of those beliefs cascaded through the financial system and government finances, pushing the euro area into a deeper and more prolonged crisis than other advanced economies. Accordingly, there is a rift in Europe between those economists and politicians who want public debt to be safe again, and those who want it to be riskier. What the report intends to discuss is how we might go about squaring the circle between risk and safety.[…]