of 2 percent for several years. this subdued outlook for both prices and employment suggests that the current path of real interest rates is actually too high to be consistent with the fomc ’ s mandated macroeconomic outcomes. hence, i would argue that the mandate - consistent real interest rate is even lower than is suggested by the current yield on tips. what happened? i ’ ve argued that the mandate - consistent path of real interest rates has fallen since 2007. i now turn to a discussion of why this has happened. i see the decline in mandate - consistent real interest rates as grounded in an increase in the demand for, and a fall in the supply of, safe financial investment vehicles. importantly, i see these changes as likely to be highly persistent. there are many factors underlying the increased demand for safe assets. i ’ ll discuss three that strike me as particularly important : tighter credit access, heightened perceptions of macroeconomic risk and increased uncertainty about federal fiscal policy. in terms of credit access, i don ’ t think that it ’ s controversial to say that credit access is more limited than in 2007. what is less generally realized, i think, is that restrictions on households ’ and businesses ’ ability to borrow typically lead them to spend less and save more. i can best illustrate this point through an example. consider a household that wants to purchase a new home. in 2007, that household could have received a mortgage with a down payment of 10 percent of the purchase price, or even lower. in 2014, that same household is considerably more likely to need a down payment of 20 percent. these tighter mortgage standards mean that, to buy a similarly priced house, the household needs to first acquire more assets. thus, the demand for safe assets has risen because of tighter limits on credit access. it has also risen because of households ’ and businesses ’ assessments of macroeconomic risk. as of 2007, the united states had just gone through nearly 25 years of macroeconomic tranquility. as a consequence, relatively few workers or businesses ( or macroeconomists! ) in the united states saw a severe macroeconomic shock as a relevant contingency. what i ’ m terming the “ mandate - consistent real interest rate ” is the same as the “ natural real rate of interest ” in simple new keynesian models. bis central bankers ’ speeches however, in the wake of the great recession and the not - so - great recovery, the story is different. now, more workers see themselves as being

services cannot. while this is an exciting prospect, it cannot be achieved without guardrails. consumer and investor protection begins with firms themselves. for the crypto sector to succeed, compliance and a customer centric approach should not be seen as a cost 2 / 5 bis - central bankers'speeches of doing business, but rather, they have the potential to be a competitive advantage. the provision of financial services is about helping others make financial decisions ; it is also about the provision of choice for consumers and importantly, the provision of products that are suitable for consumers. selecting financial services or financial products often involves taking risks. the stronger the firms risk management, the better position they are in to understand, calculate and mitigate risks, therefore strengthening their business model, and their relationship with their customers. the importance of good culture and conduct risk management in delivering on new obligations under micar cannot be overstated. it is not merely a regulatory requirement ; it should be viewed as a fundamental component of maintaining trust, integrity and stability within the sector. effective organisational culture builds on shared purpose and standards such as professionalism, honesty, integrity and accountability to deliver fair outcomes that have the interests of consumers and investors at heart. the central bank expects to see such standards and values embedded in all the firms we regulate. the importance of tone from the top, and the critical role of directors, cannot be overstated. the directors have a role in setting the culture, living by it themselves and calling out and addressing poor behaviours when observed. this will ensure that when they are faced with a dilemma or a moment of pressure, their natural instinct is to do the right thing, not the questionable thing. the value of guardrails our mission requires us to ensure that the financial system operates in the best interests of consumers and the wider economy. consumer and investor protection risks are inherently high in some crypto and services and this is a concern to us. this is why we have warned consumers that crypto products can be highly risky, speculative and are not suited for most retail consumers. where we see higher inherent conduct and consumer protection risks in products, we will have higher expectations of firm's to adhere to high standards. so in short, we take a sceptical view on business models where profitability is driven from the heavy marketing, offering and distribution of unbacked crypto to retail customers for speculative purposes. additionally, i would also like to stress that governance and safeguarding of client assets are critical considerations