tiering. the two most important characteristics of community banks for purposes of establishing regulatory objectives and supervisory practices are their size and their business model. my reference to size is obviously a bit tautological, but size is worth emphasizing precisely because of what it says about the risks community banks do not pose. the possible failure of a community bank self - evidently poses no risks to the financial system. and while individual community banks in smaller communities provide sources of credit that would be hard to replace, their limited size means their failures would not result in credit contraction in significant swaths of the country. see, e. g., daniel k. tarullo ( 2015 ), “ application of enhanced prudential standards to bank holding companies, ” testimony before the committee on banking, housing, and urban affairs, u. s. senate, washington, march 19 ; daniel k. tarullo ( 2014 ), “ a tiered approach to regulation and supervision of community banks, ” speech delivered at the community bankers symposium, chicago, november 14 ; and daniel k. tarullo ( 2014 ), “ rethinking the aims of prudential regulation, ” speech delivered at the federal reserve bank of chicago bank structure conference, chicago, may 8. bis central bankers ’ speeches the business model of nearly all community banks is grounded in the most traditional form of commercial banking – lending to businesses and households with funds predominantly obtained from deposit accounts. and, as this audience well knows, lending by community banks is built substantially on relationship banking. while community banks over the years have found it increasingly difficult to compete with larger banks in the types of lending that can be efficiently scaled through larger volumes and standardized credit models, they maintain a competitive advantage relative to larger banks through knowledge of their local communities and their individual borrowers. as a result, community banks play a unique role in their local economies, particularly with regard to lending to small - and medium - sized businesses. the relationships these institutions have with their customers oftentimes mean they can look beyond traditional credit factors to consider unique borrower characteristics when making credit decisions and to reduce information failures about borrowers ’ willingness and capacity to repay loans. numerous studies have documented these advantages and their value to economic development. one recent study found that loans extended by rural community banks to small businesses default less frequently than similar loans granted by their urban counterparts, and that the performance advantage is greater when the bank and the borrower are located in the same county. 2 the traditional inter

joachim nagel : getting inflation under control in turbulent times speech by dr joachim nagel, president of the deutsche bundesbank, at the peterson institute for international economics, washington dc, 14 april 2023. * * * check against delivery 1 introduction ladies and gentlemen, it's a pleasure for me to be with you here at the peterson institute for international economics in washington d. c. over the last couple of days at the spring meetings, we have intensely debated current events in economics and finance. i now look forward to sharing and discussing my views with you. the current economic policy debate is somewhat similar to the stage comeback of actors we haven't seen in a long time. and who had already been forgotten by some. inflation is the one actor we had not seen in a long time. obituaries to the supposedly deceased had already been written – too early! the other actor who recently returned to the scene after a lengthy absence is financial turmoil. i hope it's just a " cameo ". 2 inflation back on stage inflation had been persistently low for many years, but over the last one and a half years, it has reached rates not seen in decades. in the euro area, the so - called harmonised index of consumer prices ( hicp ) rose on average by 8. 4 % compared to 2021. never before in the history of the single currency was inflation in the euro area as high as in 2022. for several months, we even recorded double - digit figures. however, high inflation has not been a euro area - specific problem, but a global issue. according to the imf, consumer prices in the advanced economies rose in 2022 by 7. 3 %. that was the highest increase in four decades. first, disruptions in the supply chain and the wave of demand for goods during the pandemic led to supply bottlenecks. initially, many assumed that these were " transitory ". over time, however, it became increasingly apparent that inflation could remain high for longer than expected. 1 / 7 bis - central bankers'speeches russia's terrible war of aggression against ukraine and the resulting energy and food crisis then accelerated the rise in inflation significantly, especially in the euro area as a whole and in germany, which had become overly dependent on russian gas. energy and food prices rose sharply, pushing euro area headline inflation into double - digit territory. while the headline rate has since returned to single digits, underlying inflation is constantly becoming broader