brought by market - based finance, as an alternative to retail banking, means that peer - to - peer lending has potential to provide some consumers and small businesses with affordable credit, when retail banks cannot. at the same time, this implies that borrowers in some segments may be placing increased reliance on this source of funding. how stable this funding will prove through - the - cycle is not yet clear, as the sector ’ s underwriting standards, and lenders ’ tolerance to losses, have not been tested by a downturn. due to its small scale and business models, the p2p lending sector does not, for now, appear to pose material systemic risks. that said, as a general rule, it always pays to monitor closely fast - growing sources of credit for slippages in underwriting standards and the promotion of excessive borrowing. moreover, it is not clear the extent to which p2p lending can grow without business models evolving in ways that introduce conventional risks, including maturity transformation, leverage and liquidity mismatch, or through the use of originate and distribute models such as those seen in securitisation in the 2000s. were these changes to occur, regulators would be expected to address such emerging vulnerabilities. in wholesale banking and markets, robo - advice and risk management algorithms may lead to excess volatility or increase pro - cyclicality as a result of herding, particularly if the underlying algorithms are overly sensitive to price movements or highly correlated. similarly, although algorithmic traders have become a more important source of market liquidity in many important financial markets, they tend to be more active during periods of low volatility giving an illusion of plentiful liquidity that may subsequently be withdrawn during periods of market disruption when it is needed most. fintech innovations, such as distributed ledgers, are being trialled for use within, or as a substitute to, existing wholesale payment, clearing and settlement infrastructure, will need to meet the highest standards of resilience, reliability, privacy and scalability. all speeches are available online at www. bankofengland. co. uk / speeches for all financial firms, the advent of fintech materially changes operational and cyber risks. regulators need to be alert to new single point of failure risks such as if banks come to rely on common hosts of online banking or providers of cloud computing services. in recent years, the cyber threat to the system has grown as financial institutions have become more reliant on

challenge of adjusting to open trade is a serious issue that has not received the degree of attention it fully deserves. this may partly reflect the fact that the burden has been borne unequally and spread out over a long time period. it also may reflect the fact that the winners from trade have often tended to have a stronger voice than those who have been the losers. 3 / 6 bis central bankers'speeches research has documented that the effects on individuals of job dislocation — including those resulting from trade — can be significant and long lasting. older workers tend to suffer larger earnings losses, and may face larger transition costs. displaced workers may not have the appropriate skills to find good jobs in other areas of the economy, including in growing export sectors. when the affected industry represents a large share of the local economy, the damage is often magnified. in this case, the burden is more widespread because wages across the community are likely to be hit as well. and, this doesn ’ t begin to capture the full human toll — including the impact on workers who have lost confidence in the future and the poorer health outcomes that occur because of increased stress. for too many individuals in the united states, for instance, the american dream has been put at risk, with parents increasingly pessimistic about whether their children will have the opportunity to do better than they did. we should find better ways to help communities that are struggling because of the effects of free trade. in the united states, we have historically experienced a high degree of geographic labor mobility — much higher than in other advanced economies. the ability to move in search of better opportunities, when possible, has helped to mitigate some of the adverse effects of trade. but, mobility has declined in the united states in recent years, implying that the adjustment costs to trade may have increased. protectionism is not the answer given these costs of global integration and more liberalized trade, what is the best path forward? protectionism can have a siren - like appeal. viewed narrowly, it may be potentially rewarding to particular segments of the economy in the short term. viewed more broadly, it would almost certainly be destructive to the economy overall in the long term. countries need to compete better, not compete less. trade barriers are a very expensive way to preserve jobs in less competitive or declining industries. they blunt opportunities in export industries and they reduce the affordability of goods and services to households. indeed, such measures often backfire, resulting in harm to workers and