. this symposium explores both common and diverse trends shaping the united states ’ and european economies. it is worth underlining that the impact of euro - atlantic cooperation since the second world war has been enormous and positive in all walks of life. current developments, described by the organizers as ‘ growing together while growing apart ', could have equally far reaching consequences for us and european businesses and citizens, but to the reverse direction. it is essential to maintain our current global institutions, but at the same time to reform them to face new challenges. while the imf has been able to adapt itself successfully in the post - crisis era, it is the world trade organisation that is in the greatest need of reform today. as has been rightly said by eu commissioner cecilia malmstrom, we should make the wto reform a cornerstone of the next transatlantic project. i very much endorse this. international cooperation, and policy coordination, also played a critical role in firefighting the global financial crisis. from the start of the crisis, an intensive co - operation emerged between central banks to safeguard the functioning of the global financial system after the collapse of lehman. as global markets started to collapse, the demand for liquidity by the banks increased, not only in domestic currency, but also in foreign currency, most of all in us dollars. suddenly, the demand for dollars exceeded the supply on the wholesale market. subsequently, the swaps between the fed and the ecb began in december 2007. the ecb borrowed dollars from the fed, which took euros in exchange. by october 2008, the fed had decided on swaps with the ecb, bank of england and the swiss and japanese central banks to provide as many dollars as needed, thus fulfilling its role as the lender of last resort in dollars. importantly, the central banks had the necessary insight and determination to back words with deeds. ladies and gentlemen, after tough times and difficult decisions, europe was able to overcome the rock - bottom of the debt crisis by the end of 2012. during the euro area recovery since 2013, over 10 million net new jobs have been created. unemployment has fallen from its peak of over 12 per cent to below 8 per cent. the banking sector is now more resilient : capital buffers have been doubled, nonperforming loans reduced considerably, and lending to households and enterprises increased. the ecb ’ s accommodative monetary policy has been very important in supporting the recovery. during the first months of 2019

growth in the second half compared to the first half, but is important whether the slower growth turns out to be near trend, holding utilization rates constant, or above trend, pushing utilization rates still higher. at the very least, the slowdown in inventory investment is likely to be accommodated with minimal disturbance to the continued expansion. but there is a risk that growth will continue to be above trend, pushing utilization rates up, from already high levels. - 3with respect to inflation, the netting of the crosscurrents suggests a modest increase in inflation in 1998, albeit from a steadily downward - revised and very low rate in 1997. i will pay very close attention to the source of any rebound in inflation, specifically the degree to which it reflects simply the dissipation of some of the favorable supply shocks that have contributed to the very low inflation this year and the degree to which it reflects the more persistent effect of high utilization rates. as a result, i will be focusing more on core than overall inflation rates and paying particularly close attention to labor costs, given that labor markets appear tighter than product markets and therefore more likely to be the source of any increase in inflation pressures. still, any increase in inflation would begin from a lower base and may be more modest than previously appeared likely. the bottom line is that past performance, in several important dimensions, has been extraordinary and that prospects look favorable for continued expansion and relatively low inflation. still, monetary policy must be alert to the potential of a developing upward trend in inflation in an economy that may already be operating beyond its sustainable capacity and possibly still growing at an above - trend rate. and, as always, there are challenges, even in the good news economy. limits on what monetary policy can do the first challenge is to avoid becoming complacent. even as there are good reasons for celebrating recent economic performance, there are good reasons for avoiding complacency. specifically, there are dimensions of economic performance which are less stellar, such as the slow average growth rate in gdp in the 1990s, a continuation of the effects of the productivity slowdown that began in the early 1970s. there are, in addition, obvious longer - run problems that deserve to be confronted today, such as those related to the aging of the population and resulting pressures on entitlement programs. and there remain lingering social strains associated with a gradual increase in income inequality, interacting with the low average growth rate in productivity to produce a long period of relatively stagnant real income