different parts, other parts of the system adjust. as supply and demand changes, the price adjusts. does this always happen seamlessly or painlessly? no. but broadly speaking, the stress test of the past few years shows that it does happen. there were a lot of people worrying throughout that period about where the funding would come from. but in the event, the system broadly speaking coped. the system here didn ’ t fail, and that is an important point to keep in mind in this whole exercise. prices did adjust. the exchange rate in 2008 was one of them. deposit pricing was another. do markets always get this right? no they don ’ t, but it ’ s not clear what the better alternative is. regulation is motivated at least in part to address some of those deficiencies of markets. is regulation always going to get it right? clearly not. so that ’ s why we need to keep on questioning the appropriateness of the structure of financial markets and their regulation. it ’ s good to be asking the question in an environment when the system hasn ’ t failed rather than when it has, as is the case in other countries. and that i see as the value of the work the acfs is doing, namely asking the question, is the system working as well as it can? in particular, talking about the system, as rod and peter do. in terms of the way forward, kevin davis had a slide in his presentation which basically mapped the path out. what are the broad structural forces shaping the financial system in the years ahead. do we want those structural forces to play out? are they well founded or are they the result of some distortion in the system? so in a nutshell : think about the system, think about the broad structural forces. bis central bankers ’ speeches

, a media campaign in all parts of the world against terrorism is also very important. that is something that the world has clearly recognized today, and internationally, we see a greater coordination in the media in dealing with terrorism. the other important front in this war against terror is the stopping of financing for terrorism. without finance, terrorism cannot progress. so, steps taken by countries to ensure that the funding lines to terrorism and money laundering are cut off, that terror financing transactions are interrupted or stopped, and that there is worldwide co - operation to track down persons who are suspected of being involved in terror financing in whatever way, is of vital importance. just take a small example. if at the end of the month, you do not receive your salary, you will find it difficult to comfortably progress with your next month ’ s activities. in the same way, if we can stop the funds going to terrorist activities, that will put a dampener on their activities. it is very simple to understand. therefore, not only should we deal with terrorists on a military basis, but we should disrupt their progress by cutting off and interrupting their funding lines. by doing so, we complicate their agenda. in order to do so, and to continue to do so, we have to equip ourselves. the judiciary, the law enforcement agencies, the regulators, the media, the bankers, the prosecutors, all of these groups, have to equip themselves with whatever it takes, to meet with this challenge. we have to learn from each other. we have already learnt many lessons during our own activities in this field. but, it is important that we share such knowledge and experience with others as well. if we do so, perhaps others too, could replicate some of those efforts which have been proved to be successful. hence, there is an urgent need for us to create the awareness. we also have to enact the necessary laws. sri lanka has already passed the necessary laws for this purpose : so have many other countries. that is very important. because, without the legal framework and the legal backing, our efforts will not succeed. then, we have to build our own capacities. we have to have people who are trained and competent to deal with these challenges. because, unless you have the competence, and the ability to recognize certain disguised transactions, the ability to see through the clever facades, and the ability to anticipate the next move of the terror financiers or money launder