thomas jordan : the various waves of money market turbulence and the measures taken by central banks introductory remarks by mr thomas jordan, member of the governing board of the swiss national bank, at the half - yearly media news conference, geneva, 19 june 2008. * * * the money markets are the lifeblood of the international financial system. properly functioning money markets are absolutely essential for the solvency of banks, as well as for the effective implementation of monetary policy. hence, events on the money markets since the onset of the financial turmoil have been a particular focus of central banks ’ attention. so far, there have been three waves of turbulence. at the time of the last news conference, we were almost at the height of the second wave. in the meantime we have experienced a third wave, which peaked in april. an appropriate barometer of the health of the money market is the difference between the three - month libor and the three - month ( t ) ois rate ( tom - next / overnight indexed swap ). this difference reflects the credit and liquidity premium on unsecured money market trades compared to purely derivative business with virtually no counterparty risk. with the help of chart 1, which can be regarded as a “ fever curve ”, i would now like to look back at how events unfolded, and comment on the measures which the central banks took in response. the first wave peaked in september 2007. money market risk premia rose sharply, from below 10 basis points to over 50 basis points, and even exceeding 100 basis points for some currencies. in this phase, we reacted flexibly to the volatile bank demand by providing generous amounts of liquidity at our repo auctions, and by increasing the frequency of finetuning operations. in october, there was a period of calm and risk premia retreated. in this phase, our patient – the market – was prescribed the usual remedies, although in higher doses and several times a day if necessary. the second wave arose out of concerns about refinancing shortages around the year - end, and reached its peak in december. to reduce uncertainty on the part of market participants, the swiss national bank increased its repo transactions at maturities of several weeks, or even several months, instead of the usual weekly maturity. these measures made it easier for banks to manage liquidity around the end of the year. during this second wave, european banks found it increasingly difficult to refinance in us dollars, and dollar

zhou xiaochuan : china ’ s economic development and external financial cooperation speech by mr zhou xiaochuan, governor of the people ’ s bank of china, at the sino - french financial forum, beijing, 21 september 2006. * * * honorable governor christian noyer, dear guests, ladies and gentleman, good morning. today, we have gathered at the sino - french financial forum sponsored by the people ’ s bank of china jointly with the bank of france. on behalf of the people ’ s bank of china, i would like to extend warm welcome to governor noyer and the french colleagues and express sincere appreciation to the national council for social security fund, china insurance regulatory commission, the industrial and commercial bank of china, china construction bank, china life insurance ( group ) company, as well as the participating experts and academicians for your support. the theme of the forum is “ promoting the sino - french financial cooperation and dialogue ”. let me take this opportunity to share with you my views on china ’ s economic development and external financial cooperation. healthy development of the chinese economy needs international financial cooperation at a higher level. china ’ s gdp grew at 9. 4 percent on average in the past 28 years since reform and open - up, the highest in the world and almost 3 times of the world average. economic development of a country underpins the growth of its financial sector. on the other hand, as the core of modern economy, sound financial development guarantees the steady and fast development of the aggregate economy. to maintain healthy and fast economic development, the chinese government has strengthened macro - economic management, deepened economic restructuring and steadily promoted the reform of state - owned commercial banks and capital market in recent years. following the successful ipo of the china construction bank, bank of china has issued h share and a share respectively in hong kong and shanghai in june and july this year. the icbc is actively preparing for its public offering. as for the capital market, due a mistake a decade ago the institutional shares were not tradable. we have made a big decision to change it and with resource input have already achieved evident progress. meanwhile, we have conducted a series of supplementary reforms including enhancing accounting standards, reforming tax system, improving law and regulations and strengthening policy transparency. to a great extent, this has improved china ’ s investment environment and guaranteed the return on foreign capital. china has made progress in financial opening - up. as of end - june, 71 foreign - funded banks have opened 214