guidance smoothly as conditions warranted. as the newest member of the flexible it club, the fed is now also able to use the anchor of an explicit inflation target to boost the aggressiveness of its communications strategy. we expect that the fed ’ s elaboration of its longer - term policy goals will enhance the stimulative effect of its announcement that the federal funds rate is likely to remain at exceptionally low levels at least through late 2014. extraordinary forward policy guidance within a flexible it framework helped the bank of canada provide additional stimulus when it was needed and should help the fed do the same. the fed ’ s experience with a published interest rate path in conventional times, when they return, is something we will watch with interest. flexibility for non - crisis economies the robustness of flexible it benefits non - crisis economies as well. in a global economy, ties of trade, finance and confidence bind both crisis and non - crisis economies together. with the global economy underperforming and the recovery still fragile, shocks can be felt far from their origins. with flexible it, non - crisis economies can more easily absorb the shocks from global headwinds by continuing to keep inflation low, stable and predictable so that households and firms can invest and plan for the future with confidence. let me illustrate with a few practical examples from our experience in canada. as the recovery unfolded, the bank maintained an easier stance of policy than would have been implied by a simple taylor - type rule ( where the overnight rate mechanically responds to deviations of current inflation from the target ). this allowed us to bring inflation back to target and output back to potential more quickly by leaning more heavily into the sustained see the april 2009 issue of the bank of canada ’ s monetary policy report. bis central bankers ’ speeches headwinds of weaker foreign demand. 14 it also allowed us to guide market participants that, in an environment of material external headwinds, closing the output gap did not necessarily correspond with returning the policy rate to neutral. this illustrates that, in a complex and continuously evolving world, it is illusory to think that the mechanistic implementation of a simple rule would prove desirable for all the circumstances that monetary policy must face. not only does a flexible it framework enable the central bank to deal with shocks, it also provides the flexibility to address a buildup of financial vulnerabilities that a low - for - long environment can fuel. this is important as experience suggests that prolonged periods of unusually low rates can

as climate change and biodiversity. in line with these findings, a recent joint workshop between the ipcc and the ipbesviii concluded that it will be impossible to tackle climate change and biodiversity in silos. the dramatic and unprecedented changes in many earth subsystems caused by human activity have led many scientists to consider that we have entered a new geological epoch : the anthropoceneix, literally the “ age of humans ”. the first one to develop this concept was the nobel prize in chemistry paul crutzen in 2002 ”, x and many others have since used the concept, including professor dasgupta who refers to the very interesting concept of “ global economy in the anthropocene ” in his review ( page 26 ). what is at actually stake here is civilizational, and i am carefully choosing my words : the anthropocene makes it clear that failing to act on our multiple ecological crises could disrupt the stability of the earth system that prevailed over the past thousands years. for instance, the relatively stable atmospheric concentration of co2 ( around 270 - 280 parts per million, or ppm ) that prevailed for the past 12, 000 years until recently, has been critical to guarantee stable climate conditions in which human societies were able to develop agriculture and become more complex. xi we cannot even imagine human life as we know it without the stable climate that prevailed during the holocene period. in contrast, co2 atmospheric concentration is now around 420ppm, a page 4 sur 12 level that has never been reached in human history. that is, we may be leaving the holocene and entering the anthropocene. we should not underestimate the importance of this transition. let me simply quote the scientists will steffen and co - authorsxii here : “ human impacts on essential planetary processes have become so profound that they have driven the earth out of the holocene epoch in which agriculture, sedentary communities, and eventually, socially and technologically complex human societies developed ”. let me also mention that in 2019, a group of 15, 000 scientists ( yes, 15, 000 ) issued a “ warning to humanity ” xiii, reminding that runaway consumption by a growing population in a world of limited resources and limited capacity to absorb pollutions is now posing an existential threat. 2. what does the anthropocene mean for central banks? even in such a dire situation, one may still be tempted to ask : why should macroeconomists