##pier, held a speech that attracted a lot of attention on whether statutory limits to cash payments were constitutional. he regards it as being considerably doubtful that the introduction of a cap on cash payments meets the constitutional requirements of suitability and proportionality in the narrower sense. to quote : “ legislators should, at any rate, not be swayed by premature and vague assumptions, since in our free state governed by the rule of law, the following principle still holds : in dubio pro libertate. " studies show that the payment behaviour of consumers can vary greatly from country to country. germany is one of those countries in which the public likes to use traditional payment methods. although a constant – albeit slight – decline in cash as a means of payment can be observed, it is still used for almost 80 percent of all transactions at the point of sale and thus continues to be the medium of choice for spending on everyday necessities. but it is not just the payment habits of the public in germany that are subject to constant change. driven by the increasing cost pressure which the banking industry is facing at present, we are currently observing a shift in the way in which consumers obtain and dispose of cash. in the future, cash supply and removal operations could shift from classic bank branches towards the retail industry, predominantly 1 / 2 bis central bankers'speeches supermarkets. for consumers, especially those that live in rural areas where there are no bank branches and often no atms, it will be much easier to obtain and deposit cash. we welcome this new development ; however, it sets us new challenges. for even though this may mean that cash is returned to banks or central banks less frequently, its quality still needs to be maintained. in light of these developments, it is important to forge ahead with our research into the use of cash. cash is all too often reduced entirely to one supposedly determining factor : cost. however, i believe that it is preferable to give equal consideration to the benefits of cash and those characteristics that make it unique. the key advantages of cash include anonymity, immediate settlement of a payment contract at the point of sale and the possibility of effecting payment without requiring any other service providers or technical infrastructure. the latter ensures that cash can still be used even if cashless payment vehicles are unavailable. the deutsche bundesbank does not issue any recommendations for or against the use of cash. the driving principle behind our business policy is to support both consumer sovereignty and the principle of contractual freedom, and to

enough to develop his own theory of money, even though, from today ’ s perspective, it cannot exactly be classed as part of the mainstream. fortunately, there have been a sufficient number of other “ lofty idealists ” in the ensuing 100 years who have found it attractive and edifying to study money and the economy. over the course of time, economists have gained a fair amount of influence in policymaking, too, while the opponents of this development have long been branding it as the bis central bankers ’ speeches “ economisation ” of politics and society. with the 2007 financial crisis and the ensuing critical developments, unease about economists clearly grew, however. it has become fashionable to berate economists. for instance, philip stephens, the associate editor of the financial times, recently wrote that “ the economy is too important to be left to economists ”. in my view, the accusations levelled against economists are, at best, only partly justified, however. allow me to use the events at l ’ aquila again by way of illustration. the global financial crisis has often been described as a “ quake on the financial markets ”. but that is an unsatisfactory metaphor. and that is because the financial crisis, unlike an earthquake, is not a natural disaster. on the contrary, the crisis is 100 % man - made. economics is not an exact science : it is a social science. the laws of economics are not laws of nature. earthquakes can be explained as natural phenomena. when, where and with what force an earthquake strikes cannot be predicted with any accuracy, however. it is nevertheless possible to say in advance which regions are at severe risk from earthquakes and which are less exposed. certainly, financial stability reviews and other economic studies prior to the crisis contained some hints at shifts in the financial system. bis, for example, gave repeated warnings about the setback potential stemming from the rapid growth in the credit securitisation and credit derivatives segments. just to refresh your memory : between 2001 and 2007, the volume of credit default swaps grew by the factor of 100. the macroeconomic risks arising from this development on the financial markets were scarcely perceived, if they were perceived at all, however. one key reason for this is likely to be the fact that the financial markets were modelled, at best, in a rudimentary manner in the macro models that serve as an important basis for economic projections. looking back, it is possible to say that financial economics and macro