But the oil remaining under the North Sea lost even more of its value when oil prices fell from USD 150 to USD 40 in the course of a half year. On the other hand, oil prices may show a more favourable tendency than equity prices. The slide in equity prices over the past quarter has not been accompanied by weaker oil prices. Norges Bank has been delegated the responsibility for managing the Government Pension Fund Global and hence has an independent responsibility for limiting and managing risk. We  19  See national accounts data from Statistics Norway: http://www.ssb.no/histstat/aarbok/ht-0901-355.html and historical data on the Norges Bank website http://www.norges-bank.no/en/price-stability/historical-monetarystatistics/  20  See, for example, World Bank data on www.databank.worldbank.org  21  For the results of the Pisa survey, see: http://www.pisa.no/english/index.html  22  http://www.statsbudsjettet.no/Statsbudsjettet-2012/English/  6  BIS central bankers’ speeches  have therefore reduced the fund’s holdings of southern European government bonds in recent months. We have also reduced counterparty exposures to European banks. Maximising returns As a long-term investor, Norges Bank seeks not only to minimise the risk of losing wealth, but to maximise the return on the fund’s capital within the risk limits set by the fund’s owner. But how can we manage our wealth to promote capital growth? Many have probably wondered as does the poet Jan Erik Vold when he writes: “You put as the advert says 20 000 kroner into a high-interest savings account in one of our largest banks.

16  For fund holdings, see the NBIM website: http://www.nbim.no/en/Investments/holdings-/  17  National income in OPEC countries decreased on average by 1.3 per cent annually in the period between 1965 and 1998 while OPEC oil production increased. 18  See “Globalisering, olje og pensjonsfondet” [Globalisation, oil and the pension fund] by Ragnar Torvik, available on the Ministry of Foreign Affairs website (Norwegian only): http://www.regjeringen.no/nb/dep/ ud/kampanjer/refleks/innspill/oekonomi.html?id=491448  BIS central bankers’ speeches  5  Over several decades, the investment share of GDP 19 was close to 30 per cent, markedly higher 20 than in other western economies. But the Norwegian economy still expanded at a slower pace than nearby countries. A more efficient use of capital could have boosted consumption without negatively affecting economic growth. The high investment level entailed human costs in that consumption of important goods were rationed. A visible cost was limited imports of fruit. As I recall, the selection of fruit and vegetables at that time would have made the recommended “5 a day” serving of fruit and vegetables far more difficult to follow than today. In recent years, 15–20 per cent of GDP has been invested in the mainland economy, or about the same percentage as our neighbouring countries. But we are always faced with demands for more investment, which is perhaps not that surprising. All of us have probably been stuck in a traffic jam and felt irritation over poor road conditions. It is easy to agree that investment in knowledge is sensible and of benefit for the future.