, only structural reforms can raise potential growth ; aggregate demand policies cannot provide a substitute. what they can do – and it ’ s precious — is to help better manage time. speaking of managing time, i think mine is up now and i shall give the floor to christian who can give us all the benefit of his experience and wisdom. short bibliography : r. baldwin, c. teulings, 2014 : secular stagnation : facts, causes and cures, cepr press ; in particular, chapter 8 by o. blanchard et al., chapter 9 by r. caballero and e. farhi, chapter 11 by r. koo. bis annual report, 2014 : “ debt and financial cycle ” ( chapter iv ). o. blanchard, e. cerutti and l. summers, 2015 : “ inflation and activity – two explorations and their monetary policy implications ”, imf working paper no 15 / 230. n. chatelais, a. d. gaye and y. kalantzis, may 2015 : “ low inflation in the euro area : import prices and domestic slack ”, rue de la banque 6, banque de france ( showing no clear - cut change in the slope of the phillips curves in the eurozone and france over the last 10 years ). m. draghi, the economic club of new york, dec. 4, 2015, based on work by a eurosystem task force, including bdf staff : http : / / www. ecb. europa. eu / press / key / date / 2015 / html / sp151204. en. html. e. engen, t. laubach and d. reifschneider, 2015 : “ the macroeconomic effects of the federal reserve ’ s unconventional monetary policies ”, finance and economic discussion series 2015 - 005. board of governors of the federal reserve system ( and references therein ). s. guilloux - nefussi, march 2015 : “ globalization, market structure and the flattening of the phillips curve ”, banque de france working paper no 539, ( proposing a theoretical model explaining a possible flattening of the phillips curve since the 90s ). imf global financial stability report, april 2013 ( chapter i ). h. rey, nov. 2014 : “ monetary policy and the global financial cycle ”, bdf international symposium on “ central banking : the way forward ” and jackson

productivity growth, higher inequalities or population ageing which pushes the savings rate higher. the other usual suspects behind secular stagnation include globalization, which boosts price / wage competition, or the savings glut. and the latter may be involuntarily compounded by liquidity regulations which can permanently raise demand for safe liquid assets, driving down risk free rates. in this case, the neutral rate may have become so negative that monetary policy alone may not suffice to raise inflation. the jury is still out ; but faced with this uncertainty, cbs ’ mandates push them to avoid the risks of the first type, related to inaction, rather than those of the second type, related to pro - action ; in other words, be ready to risk doing too much rather than too little. moreover, lower supply may well stem from persistently lower demand, e. g. with some hysteresis resulting in disqualified workers and higher structural unemployment. ii. now let ’ s turn to what monetary policy should / can do i would like to mention four challenges : first challenge : if the factors at play are global, what can domestic policies do? cbs have domestic mandates whereas the prevalence of lowflation and low rates suggests that some common or external factors may be at play. this is especially problematic for smaller open economies. and the existence of a “ global financial cycle ” a la rey highlights the limits of flexible exchange rates in insulating those economies. ultra - accommodative policies in aes have definitely had spillover effects on emes, including the often - forgotten – albeit welcome - reduction of spreads in the latter, as shown by imf research. nevertheless, the formulation and stance of policies in one country can take account of feedback effects from others. and it goes without saying that the world at large would have been even worse off if aes had fallen into deflation. aside from building and using forex reserves, domestic policies should therefore contribute towards making the domestic real economy and its financial system more resilient to external shocks. in this regard, prudential policy aimed at building buffers or protecting financial institutions may complement monetary policy, provided these measures do not conceal a form of protectionism or an attempt at deglobalization. second challenge : what should the inflation target and its horizon be? some economists have called for adjusting the inflation target, although in opposite directions : a few have argued for a higher target to avoid testing