that staten island ’ s economy was actually more resilient than manhattan ’ s during the recession, experiencing only minimal job losses. staten island ’ s key industries – local - market sectors like health, education and retail trade – tend to be less susceptible to sharp economic downturns than more cyclical sectors, like manufacturing, construction and finance. even so, not all indicators of the local economy are improving. unemployment remains stubbornly high, at just over 8 percent. and home prices, though recovering gradually, are still down about 15 percent from where they were back in 2007. this compares to nationally where they are down about 25 percent on average. the new york fed ’ s quarterly measures of household credit conditions signal some recent improvement, though there clearly remain pockets of financial stress among families here. at year - end, for those people with a credit report, average debt per person in staten island ticked up, rising to about $ 67, 000, after trending down for a number of years. a similar uptick in debt was observed nationwide, potentially signaling that households are now somewhat more willing to take on debt. delinquency rates, however, are still fairly high : 9. 7 percent of all debt in the county is seriously delinquent, well above the national rate. on a more positive note, delinquency rates on staten island are declining and are at their lowest level in 3½ years. mortgage delinquency rates, though still above the national rate, are also at a 3½ - year low. recently, of course, staten island ’ s greatest challenge has been the massive disruption and destruction caused by superstorm sandy. while many parts of the new york city metropolitan region were hard - hit by the storm, the devastation was particularly severe here on staten island. and this is something that has had large consequences for some of my colleagues at the federal reserve bank of new york. nearly 150 of our employees call staten island their home. while many, thankfully, were spared the full brunt of the storm, i know quite a few people whose homes were destroyed or severely damaged and others who lost many of their belongings. immediately following sandy, our regional and community outreach function reached out to all of the affected communities as part of a needs assessment. we asked : “ how can the new york fed best leverage our resources to help our community? ” after dozens of conversations with leaders of the community, we determined that pulling together key service providers under one roof would

have just explained why i am not convinced by this argument. as for the claim that the decision to enter erm ii was hasty and premature, that suggests recklessness! no, there was no rush. the decision was made after thorough consultations with the eu commission and the european central bank ( ecb ) in the light of the progress achieved by malta in fiscal consolidation and structural reforms. their agreement was contingent on a firm undertaking by the maltese authorities to continue to implement the convergence programme. a related objection is that before adopting the euro malta should first satisfy tests similar to those set for the british economy by chancellor brown. this argument betrays an insufficient familiarity with the chancellor ’ s five tests. they are, in fact, not so different from the maastricht criteria, which malta, together with the six other new member states currently in erm ii, is seeking to satisfy. the five tests relate to convergence ( like the maastricht criteria ) ; flexibility of labour, product and capital markets ( being addressed in malta ’ s convergence programme ) ; investment, i. e. whether euro will encourage more inward fdi ( the british treasury ’ s 2003 report suggests that it does ) ; financial services ( this applies to the special case of the city of london ) ; and growth, stability and employment. malta ’ s strategy document, published jointly by the government and the bank last year, argues that the euro would be beneficial in this respect ( and so does the treasury report ). the case for adopting the euro sooner rather than later is set out in the strategy document. i shall only reiterate here that for a small, open economy like ours with no trade or capital controls, keeping a separate currency leaves us exposed to external shocks and volatile capital flows. we are thus obliged to maintain a large amount of external reserves. these are financial assets that could perhaps earn higher rates of return if invested domestically. instead, we invest them abroad, in effect promoting foreign, rather than domestic growth. that is the price we pay to have an independent currency. this vulnerability is indeed one of the main reasons why some leading academics in this field believe that the small new member states should have been allowed to lock themselves into the relatively greater security of the euro area as quickly as possible. the validity of this view was underscored by malta ’ s experience in late 2004 / early 2005 when the bank ’ s external reserves declined as a result of uncertainty created by speculative comments on the exchange rate.