this was partially because the shocks to asset prices were less broadbased, and partially because commodity markets had gone through a period of volatility just a few months earlier, so initial margin was already elevated. some early lessons just because central clearing has been a success, does not mean that ccps and ccp regulators do not need to keep learning. ccps have been central to making the financial system safer over the past decade. but we have also seen new significant strains that need to be addressed. policy makers and market participants have deliberately and sensibly put ccps in the centre of the financial system. to continue to earn that trusted role we need to keep learning – we cannot be defensive. i see three areas for further work ( 1 ) tackle the side effects without sacrificing the cure by design, post - crisis reforms mean that in events of market turmoil losses are crystalized promptly and risk is repriced. but as we have seen in 2020 and again in 2022 this can mean very sharp strains on liquidity in parts of the system. the answer here is obviously not to return to pre - 2008. we need to avoid having such short memories that we return to a pre - lehman system. instead, just as ccps were part of the solution when it came to counterparty credit risk, they can play a role in helping to solve the liquidity risk we have seen recur in each recent episode of stress. in particular, ccps can : ensure that im is sufficiently conservative in good times that it reduces the need for wild swings once a crisis hits ; and ensure that participants have sufficient information, data, and tools to anticipate what margin calls might look like under stress, and how pro - cyclical they may be. importantly, tackling the side effects will also require addressing participants ’ preparedness to meet stress margin calls. while ccps can play a part in the solution, this is not something ccps can solve on their own. we also need to take a hard look at the ability of non - banks to insure against severe but plausible liquidity stress. the international work to look at these issues [ 8 ] is welcome – it offers opportunities to address them in a way that preserves and enhances the role of ccps. if done right, it can help to address the lessons of the covid and russian invasion market turmoil, while ensuring that market participants have incentives to centrally clear their derivatives trades in good and bad times. (

jens thomsen : government bond market in light of the recent turmoil speech by mr jens thomsen, member of the board of governors of the national bank of denmark and chairman of the economic and financial committee, sub - committee on eu government bonds and bills market 1, at the european government bond summit, brussels, 24 october 2008. * * * introduction i am delighted to be here today to offer my view on the ongoing turbulence in the financial markets. in the not so distant past the financial markets played a role by applying pressure on member state governments to run sound public finances in stage iii of the emu. today the tables have been turned. a reasonable description of the present agenda is more along the lines of how the public finances can promote sound financial markets ( see slide 2 ). liquidity in turbulent times the price of liquidity increases. since august of 2007 there has been four consecutive waves of illiquidity, during which the perceived default and liquidity risk of banks have risen and widened the spread between unsecured and secured lending and where the fourth and last spike following the default of lehman brothers has been the most severe ( see slide 3 ). the decomposed ted spread shows how t - bills have become especially valuable in times of crises ( see slide 4 ). during the four spikes the lending against us t - bill has driven down the t - bill rate. the same effect has not been quite as prominent in the european money market ( see slide 5 ). the most recent flare up of the turbulence has however lead to significantly increased demand for short term government securities leading to lower interest rates for the german t - bills. prior to the recent turbulence in september the search for safety drove down both the t - bill and the highest rated commercial paper yield. lately the status of the commercial paper programs as a safe heaven has eroded, as the cp - markets have frozen ( see slide 6 ). outstanding amounts of asset backed commercial papers took a significant dive at the outset of the turbulence in 2007 ( see slide 7 ). recently the outstandings of commercial papers for financial issuers have been declining. note however that the latest data does not reflect the impact of the commercial paper funding facility ( cpff ) provided by the federal reserve. credit risk and issuance terms the increased price of liquidity has been followed by an increase in of the price of credit. the recent announcements of bank recapitalisations and guarantee schemes have curtailed the upswing in the cds spread in