chart is the log level of real house prices indexed to zero in the peak year. as can be seen from the chart, on average the growth rate of money increases fairly steadily until around two quarters before the peak in real house prices and then drops fairly steadily for ten quarters afterward before recovering somewhat. although there are some variations, this pattern tends to occur in most countries'episodes. 6 importantly, the connection between money growth and house prices does not seem to vary much with the rate of macroeconomic expansion. this statement is underlined by figure 4, which shows as an example actual house prices for the united kingdom ( the broken line ) and their forecasted values from an equation based on the growth rate of real broad money and real long - term interest rates over more than twenty years ( the solid line ). the close correspondence is apparent. while these results are suggestive, correlation is by no means causality. confirming that variations in growth rates of liquidity ( especially unusual changes in liquidity growth that could be called excessive ) systematically lead to wide swings in real asset prices requires further theoretical investigation and more empirical support. that asset prices rise during a period of monetary easing is not surprising, of course. but why growth of money sometimes might cause housing prices to move more than other asset prices or, for that matter, than goods prices is not clear. indeed, some elements of causality run in the opposite direction, clouding the underlying relationships. for instance, as the value of collateral rises during a house price boom, the associated expansion of credit typically leads to increases in broad money. the effect can be accentuated by the temporary parking in liquid accounts of the proceeds from the more - frequent turnover and refinancings that often accompany a house price boom. complicating the analysis further, a substantial list of third factors could drive both housing prices and liquidity measures, producing co - movements that look like causality. a productivity shock or a sharp decrease in energy prices, for example, could lead to general economic expansion and rising asset prices while goods prices are not rising. this situation might allow more liquid monetary conditions than would otherwise be the case. distinguishing the various forces in play obviously requires tools that are finer than simple observations that both liquidity measures and assets prices are moving together. identification of unsustainable movements the example cited above also should remind us that not all situations in which asset prices are rising rapidly under seemingly easy monetary conditions are worrisome. some are quite benign

we believe that the best ideas, policies and, ultimately, service to the public are the result of diverse perspectives, and from a staff that reflects the rich diversity of our nation. inclusion makes us stronger by providing all employees the assurance that they will be working in an environment that welcomes and values their differences, and that recognizes and rewards people according to the contributions they make in advancing the mission of the organization. that is not to say that we have all of the solutions, or that we do not have considerable progress to make. but we have made efforts in a number of areas. these efforts are consistent with the congressional directive to establish the office of minority and women inclusion, and as articulated in the board of governors'strategic plan for diversity and inclusion. 2 first, we have made a commitment, and have made progress, to make our institution more diverse. that includes efforts to bring greater diversity to the board of directors of our federal reserve banks and branches as well as to senior leadership in the federal reserve system. we have also worked to improve our internal culture. these efforts include re - establishing and strengthening employee resource groups. we are working to come up with codes of conduct including efforts to make our meetings more inclusive and set rules around behavior in seminars. we are also providing diversity and inclusion as well as bystander training to both new and 1 / 2 bis central bankers'speeches existing employees. second, we have broadened our reach in recruiting to provide a more diverse range of applicants the opportunity to apply for positions at the federal reserve — through strengthening our connections to schools that serve diverse populations, hiring an outreach specialist for these communities, establishing a stronger presence at career fairs for diverse students, and hosting career events for students to promote jobs in economics and finance at the federal reserve. third, we are working with high schools and universities to inspire students'interest in economics and finance. we are also working to provide them with the tools they need to enter these fields. this has included partnerships with local high schools to teach economics, and with a local historically black university, howard university, to teach and mentor students in economics and statistical analysis. this last initiative has led to students developing an interest and pursuing careers in economics, including as research assistants at the federal reserve, and several are currently employed at the board as research assistants. of course, these conferences are also an important part of addressing diversity and inclusion in central banking, and the economics and finance professions. i look forward to welcoming all of you to