amando m tetangco, jr : strengthening the bonds of partnership for better education remarks by mr amando m tetangco, jr, governor of the central bank of the philippines ( bangko sentral ng pilipinas ), at the ceremonial turn over to deped of computers under “ tulong barya para sa eskwela ” and teachers ’ guides on saving & money management, manila, 31 july 2007. * * * secretary jesli lapus, monetary board members juanita amatong and alfredo antonio, dr. cielito habito, our other partners from the department of education, fellow central bankers – good morning and welcome to our turnover ceremony with the department of education. i am very pleased that you all took the time to join us in this simple but significant event. a warm welcome to all! today, we see, in very concrete terms, the results of the successful partnership of the department of education and the bangko sentral ng pilipinas. first, we have the symbolic turnover of more than 500 brand new computers from bangko sentral to public elementary schools under the department of education. these computers were funded from the award - winning “ tulong barya para sa eskwela ” the joint program of the deped and the bangko sentral to promote efficient recirculation of our coins by encouraging coin donations for public elementary schools. if you recall, schoolchildren were at the forefront of the campaign, serving as agents of change in their homes and communities in the proper appreciation of the value of coins. over a six - moth period, “ tulong barya para sa eskwela ” generated benefits worth p14. 88 million : p6. 65 million in cash donations from the public which have been turned over to deped and p8. 23 million in coin production savings for bangko sentral. in recognition of the schoolchildren ’ s role in the successful campaign, the members of our monetary board unanimously approved the donation of bangko sentral ’ s entire savings of p8. 23 million through the purchase of computers for public elementary schools. ladies and gentlemen, let us thank our schoolchildren and our monetary board with a round of applause! based on our initial estimates, we would be able to donate 472 computer units from our savings. but because of the close cooperation of our it department, the corporate affairs office, and our bids & awards committee we are getting a total

october 2008, overnight money market activity rapidly occupied the lower half of the corridor, and in fact, with few interruptions, the overnight rate has been close to the floor of it ever since. for all practical purposes, the relevant portion of the corridor for daily market activity has shrunk to the space existing between the rate on the main refinancing operations – on the upside – and the rate on the deposit facility – on the downside. bis central bankers ’ speeches should the corridor be brought back to its standard width – spanning the entire distance between the marginal lending rate and the deposit facility rate – not only de jure but also de facto? in other words : should we go back to the standard quantity - based technology of liquidity provision which was founded on the principle of balanced liquidity conditions? or should we maintain excess liquidity and operate the system through parallel adjustments to the deposit facility rate and the rate on the main refinancing operations? i am asking this question, because observers – marvin goodfriend1, for example – have been arguing for a system where the monetary authorities adjust a policy floor – the rate paid on reserves or the deposit facility rate – and the system is saturated with excess liquidity, so that overnight market rates are kept close to the floor. let me expound the merits and drawbacks of the discussed system, again upon the premise that i do not have a quantitative scale to weigh the ones against the others. • first advantage : the volatility of the overnight rate would likely be squeezed to minuscule numbers. true, our overnight rate has been more – rather than less – volatile since it moved to the floor of the corridor. but it is also true that excess liquidity conditions have been unsteady and uncertain in the past. here, i imagine a scenario in which the liquidity supply would be kept steady and reasonably predictable. a more stable overnight rate, it has been argued, could enhance the transmission of policy shifts – adjustments to the deposit facility rate – throughout the term structure of money market rates. • second advantage : the central bank would maintain one important acquisition from the crisis period : that is, its capacity to disentangle interest rate decisions from decisions concerning the scale of its own liquidity operations in order to remain resilient to large - scale liquidity shocks. this possibility may come in handy at the time of exit, in situations when inflation risks would call for a tightening of policy, while concerns about the