survey. in addition, the bank undertakes inhouse policy research, procures technical assistance from various sources, including think tanks, and reaches out to other institutions for collaborative research. all this point to the fact that we, as an institution, have to continually build the requisite capacity, including in modelling and forecasting. for those participating in our surveys, we want to express our profound gratitude for their cooperation. i should hasten to add that under the new bank of zambia act it is a statutory requirement for respondents to provide information when the institution formally asks for it. ladies and gentlemen, in closing, let me comment on our regular engagements that we have with you, our stakeholders after each mpc meeting. we appreciate and value these engagements as they accord us an opportunity to explain our policy rate decisions. the ensuing interactions also help us to get the much - needed insights and feedback on your understanding and the implications of our decisions on the economy, which serve as important inputs into our future decision making process. with the publication of the mpr, we hope that you and other stakeholders will be better informed about monetary policy formulation and implementation in zambia. with these remarks, it is now my singular honour and privilege to officially launch the monetary policy report. thank you for your attention and god bless! 3 / 3 bis - central bankers'speeches

: imbalances in financial market developments the third explanation for the financial crisis thus relates to the liberalisation of the global financial system, and problems relating to financial innovations and regulation. the liberalisation of the global financial markets and deregulation intensified in the 1980s. this was partly a natural consequence of developments in information technology and the management of financial risks. an underlying factor was also the growing emphasis on the virtues of free markets in all areas of economic activity. at the end of the 1990s, the glass - steagall act was repealed in the united states. the act had separated investment and commercial banking activities. moreover, the large wall street investment banks that had traditionally operated as partnerships were converted into limited companies one after the other. more research on the role of these regulatory and structural changes in the development of the 2 / 7 bis central bankers'speeches financial crisis would still be welcome, but it is quite likely that they increased risk taking. as is now well - known, one of the changes that took place in banking in the pre - crisis decade was the increasingly widespread use of the ‘ originate and distribute ’ business model. this was justified by more efficient diversification of credit risks of bank loans. unfortunately, it also broke the traditional link between borrower and lender, which led to a loosening of lending criteria. this business model made use of the so called “ off - balance sheet channel ” which also had another motive : it enabled lower capital requirements, within the regulatory rules in force at that time, even though risks had remained virtually unchanged. tim geithner, the first treasury secretary in barack obama ’ s administration, argues in his memoirs that the key cause for the crisis was the business model applied by investment and commercial banks, a model which was a combination of a low level of equity and very short - term market funding. regulation also allowed banks to use low - quality capital to fulfil part of the capital requirements, which did not provide a buffer against losses. this turned out to be a key mistake. there is a broad consensus on geithner ’ s views on both sides of the atlantic. but what were the underlying factors that led to banks ’ excessive leverage and an increase in short - term market funding? according to one explanation, this was a case of the typical euphoria that occasionally sweeps the financial markets. the euphoria was also fuelled by the aforementioned, seemingly benign macroeconomic environment that prevailed before the crisis. the overheating was