, households ’ and governments ’ future income expectations had become disconnected from underlying growth, leading to an accumulation of excess debt. those over - optimistic expectations were in turn reinforced by this renewed, yet complacent sense of economic prosperity. so when the cycle did finally turn in 2008, several euro area countries were confronted with pronounced “ balance sheet recessions ” : downturns created by the need for both private and public sectors to deleverage. this has produced a set of circumstances – a protracted slump – that are observationally equivalent to those that one would associate with secular stagnation. but it is important that we distinguish this from the longer - term slowdown in potential output, since it remains ultimately a cyclical phenomenon and hence amenable to different policy tools. so how should policymakers respond to this mix of challenges? to be effective, the policy response should be comprehensive, consistent, well - sequenced and incentive - compatible. monetary, fiscal, structural and macro - prudential policies all have a role to play. with such a policy mix, i see no reason why we cannot lift both actual growth and trend growth back to more satisfactory levels. 1 / 2 bis central bankers'speeches given the distance - to - frontier of many euro area economies, there is significant scope for a productivity catch - up with the right supply - side policies. and insofar as demand - side policies support the cyclical recovery, and thereby address the headwinds created by protracted balance sheet adjustments, they can prevent further damage being done to the productive side of the economy through hysteresis effects. in this sense, secular stagnation is not predestined, but is a possible outcome of bad macroeconomic policies. in fulfilling its role in this comprehensive response, monetary policy is confronted with three key challenges. these challenges are related to measurement uncertainty, policy instruments and its relationship with other policy areas. first, measurement uncertainty. in theory, monetary policy should track the equilibrium real interest rate. the equilibrium real interest rate can be viewed as the interest rate consistent with saving and investment being in balance and output being at potential, with neither upward nor downward pressure on inflation. in practice, however, the equilibrium real interest rate is an elusive concept, or more precisely an unobservable variable – like the output gap – whose estimates are subject to significant uncertainty. ecb staff estimates of the equilibrium real interest rate point to a significant decline over the past 10 years,

negative influence may spread across the board. the bangladesh bank heist in the beginning of this year was the case that abovementioned risk was materialized. for the sound development of fintech, information security is a key. fintech has various characteristics, such as advanced information processing utilizing big data and ai. additionally, fintech is characterized by an “ openness ” of networks, with the expansion of new media and instruments, including internet and smartphones, enabling ready access to financial services. this enhanced accessibility to financial services benefits customers and adds to their convenience. on the other hand, as financial networks become increasingly “ open, ” potential target points for cyber - attacks also tend to increase. therefore, how to simultaneously manage “ openness of financial networks ” and “ information security ” is a big challenge for fintech. financial services can be regarded as the processing of information for creating value in the linkages between economic entities over time and space. this is demonstrated in the payments and financial intermediation that connect various entities, such as senders / receivers and lenders / borrowers. in this sense, such activities must always be supported by people's “ trust. ” since fintech is illustrated as a technologically advanced form of financial services, the importance of trust also applies to fintech. for the development of fintech, it is imperative to firmly maintain people's trust in financial services while facilitating the creativity and innovation needed to meet the needs of people. if information security problems were to repeatedly occur in a part of fintech services, public trust toward fintech in general would be eroded even though such problems are caused by a limited number of entities. people ’ s anxiety for new services would hinder the sound development of fintech overall. bis central bankers ’ speeches the information technology behind fintech, if properly applied, should and can also contribute to enhancing information security and the safety of financial transactions. for example, seal stamps and pins, which are traditional measures for verification in financial transactions, are accompanied by certain risks, such as theft and identity theft. in this regard, biometric authentication utilizing new technology may contribute to reducing these risks and strengthening the security in financial transactions. thus, it is critical for relevant parties to make utmost efforts to use technological innovation for enhancing security in financial transactions. fintech will thrive and grow when users associate it not only with convenience but also with safety and trust. iv. initiatives at the bank of japan fintech has various implications for central banking.