after we have successfully concluded this current programme at the end of january 2013. bis central bankers ’ speeches the ecb will coordinate the programme from frankfurt am main and has dispatched a resident programme coordinator who will remain in belgrade until it is completed. the national central banks have identified their respective experts on supervision, foreign exchange reserve management and payment systems, to give just a few examples. the national bank of serbia has also made very strong commitments, assigning substantive resources to the programme and its coordination. i wish all the experts and managers involved success in achieving the ambitious targets of this two - year central bank cooperation programme. many thanks and good luck to you all. bis central bankers ’ speeches

1939 concept of “ secular stagnation ” with interest rates staying permanently at lower levels and economic activity remaining subdued. there are many such examples. for instance, our imperfect understanding of the current slope of the phillips curve and the trends in productivity is one of the reasons why the ecb has been reluctant to complement its forward guidance with numerical triggers. i do not share this pessimism but i think it is of great importance to understand to what extent this development is driven by long - term forces, such as demographic changes or lower potential growth, and to what extent it is driven by medium - term forces, such as changes in risk aversion and the perceptions of macroeconomic risks in the wake of the recent crisis. frictions and rationality institutional details and frictions, both on the side of market participants and regulatory institutions, have an impact which is difficult to detect in normal periods. interbank markets, for instance, used to be seen by academics as a somewhat dull topic before the crisis, so that little was known about their functioning. both in europe and in the united states, they have been at the centre of recent policy debates, generating a welcome crop of new research, to which mars has been contributing. the dominant “ rational expectations ” modelling paradigm in economic research postulates strong assumptions about human decision - making, implying, for instance, that economic agents are always able to assign sensible probabilities to alternative outcomes. clearly, this characterisation of human decision - making stands in stark contrast to our own recent experience. we need to understand how panics and bubbles can emerge from psychological biases. the nobel prize co - awarded to robert shiller last year will certainly encourage more research in this direction. while much progress has been made on studying notions such as knightian uncertainty, sentiment, confidence or sunspots, more work is probably needed before they can be part of our standard modelling toolbox. a challenge is of course to come up with tested and robust behavioural theories. another important departure from rationality that is of key practical concern is how simple behavioural rules adopted by market participants in normal times can lead to entirely different outcomes or even to market meltdowns in crisis periods. agent - based models are a promising way to look at these problems, but they need to be developed in close cooperation with practitioners and policy - makers to take the proper behavioural rules as inputs. on both issues, what policy - makers need above all is more work integrating these approaches into richer