a single window, time - bound process for resolution of assets with an explicit emphasis on promotion of entrepreneurship, maximisation of value of assets, and balancing the interests of all stakeholders. these steps are unprecedented in the history of our nation in that they show the government ’ s commitment to sound public policy by establishing institutions and ceding power to them to perform functions vital for securing and entrenching macroeconomic and financial stability. page 3 of 6 7. economists are often misunderstood and at times maligned. to illustrate, economists are heaped with the criticism that they failed to see and predict the 2007 - 08 global financial crisis, and this has dented the credence of their profession. to my mind this is patently unfair. doctors understand diseases but cannot predict when one will fall ill. the fundamental mission of economists is not to forecast crises but to explain how mankind behaves in the ordinary business of life and in doing so they do warn of crisis formations, suggest pre - emptive strategies and formulate mitigating policies that address those crises that slip through macroeconomic surveillance. more often than not, they meet with resistance. hyman minsky laboured in relative obscurity from the start of his academic career in the 1950s until 1996, when he died. 1 his research about financial crises and their causes attracted little mainstream attention back then. it was only in 2007 when the subprimemortgage crisis erupted, that everyone started turning to his writings as they tried to make sense of the chaos engulfing global financial markets. the eruption of a financial crisis from a state of dormancy or calm is now often referred to as the “ minsky ” moment. in another striking example, george akerlof ’ s landmark paper “ the market for lemons ”, 2 was rejected by several journals before it was finally published. as time passed, his seminal paper brought home the wisdom that adverse selection was a fundamental cause of market failures and the idea turned into a foundation stone of information economics. 8. new and fresh ideas often meet a wall of resistance as they tend to challenge inertia in the existing shores of thinking. so as you go into the world to answer your calling, be fearless and experimental in opening up your minds and in thinking out 1 hyman minsky [ 1986 ], “ stabilising an unstable economy ”, mcgraw - hill professional, new york. 2 george akerlof [ 1970 ], “ the market for lemons

parameters. a central bank must be reliable, particularly in times of great uncertainty. as abraham lincoln said : don ’ t change horses in mid - stream. recently, calls to adapt our inflation objective have been made more frequently, especially in the light of rising inflation rates. however, growth is still fragile and the inflation path still not sustainable, particularly in view of domestic price pressures. in this context, how much longer can we continue to talk about even lower rates as being an option? considering the importance of credibility for a central bank, we should not delay in making necessary adjustments to our language and actions. and yet, we should not be hasty. the fragility of the recovery calls for great caution. low interest rates and an accommodative policy remain appropriate in the current context. adapting to new circumstances takes time. impact of monetary policy on banks for we are aware that our measures have side effects and that these become more pronounced the longer the unconventional measures last. let me emphasise that these measures are temporary. they are not a permanent part of our active toolbox. but more on that later. to mitigate risks as far as possible, we closely monitor the broader repercussions of our monetary policy. we pay special attention to insurance companies and pension funds, and above all to banks, which play a key role in the transmission of our monetary policy. let ’ s first of all take a look at the banks : ecb analyses show that our measures are having a positive impact overall on bank profitability. 1 over the longer term, however, abnormally low or negative interest rates, together with a very flat yield curve and negative term premia, can have adverse effects. 2 those banks whose business depends heavily on maturity transformation and on deposit - based 2 / 5 bis central bankers'speeches refinancing are being hit particularly hard. and as it is difficult to pass negative interest rates onto retail customers and as the introduction of fees provides only limited remedy, some of the banks will have to adapt their business models. also, consolidation will continue to be necessary to increase long - term efficiency. we are already seeing now that concerns about the future profitability of banks are affecting their share prices. the euro area bank index fell by around 40 % between august 2015 and august 2016, for example. this decline was driven by, among other things, a worsening outlook for the global economy and growing concern about the effects of the low interest rate environment and non - performing