obstfeld, m. and rogoff, k. ( 1995 ), “ exchange rate dynamics redux ”, journal of political economy, vol. 103, no. 3. rey, h. ( 2013 ), “ dilemma not trilemma : the global financial cycle and monetary policy independence ”, paper presented at the 25th jackson hole symposium, wyoming, august. shiller, r. ( 1993 ), “ macro markets : creating institutions for managing society ’ s largest economic risks ”, oxford university press. shiller, r. ( 2003 ), “ the new financial order : risk in the 21st century ”, princeton university press, princeton. truman, e. ( 2012 ), “ the international monetary system or “ non - system ”, in “ global economics in extraordinary times : essays in honor of john williamson ”, edited by bergsten, c. f. and henning, c. r., peterson institute for international economics. watts, d. ( 2002 ), “ a simple model of global cascades on random networks ” proceedings of the national academy of sciences of the united states of america, vol. 99, no. 9. bis central bankers ’ speeches appendix bis central bankers ’ speeches bis central bankers ’ speeches bis central bankers ’ speeches bis central bankers ’ speeches bis central bankers ’ speeches bis central bankers ’ speeches bis central bankers ’ speeches bis central bankers ’ speeches bis central bankers ’ speeches

targeting ‘ puzzle ’ by returning cpi inflation to 2 % at a specific point in time does not, of itself, represent a comprehensive or complete solution to the underlying problem of achieving price stability. it is not ‘ job done, we can now move on ’ to other issues. on the contrary, to paraphrase thomas jefferson : the price of achieving meaningful price stability is eternal vigilance. for one of the characteristics of a ‘ wicked problem ’ is that it does not a have a ‘ stopping rule ’. in other words, it is not possible to say that a ‘ wicked problem ’ has been definitively solved, once and for all. converting the ‘ wicked problem ’ into a ‘ puzzle ’ appears to make resolution more achievable and likely, but potentially at the risk of missing a key aspect of what makes the underlying problem so challenging. on the mpc, we are focused on returning cpi inflation to the 2 % target in line with our remit. given our mandate, that is what we should, have to and are doing. in parallel, we need to recognise that returning inflation to target is not the end of the story. we have to keep it there on a lasting and sustained basis. even if we return to more benign times in the coming years, the bank of england will still need to make investments in human, analytical, technological and institutional capital to ensure it has the capacity and capability to meet its price stability mandate. and on the basis of those investments, it will need to ensure that shocks that create either inflationary or disinflationary pressures in the future are met with policy responses that support price stability. many of you are studying economics ( or related disciplines ) here at warwick. at the bank, we are always seeking smart and dedicated recruits that want to contribute to our work. even after the mpc has brought cpi inflation back to 2 % – as i am sure it will – you can be sure that there will still be plenty of interesting and important work for you to do at the bank if we succeed in attracting you to threadneedle street. the views expressed in this speech are not necessarily those of the bank of england or the monetary policy committee. i would particularly like to thank saba alam, andrew bailey, harvey daniell, swati dhingra, jonathan haskell, catherine mann and martin seneca for helpful comments on earlier drafts of these remarks. the responsibility for all remaining errors is my own. endnotes 1. friedman