just borrow, invest and consume and satisfy all their wants. so as i said, he would be perplexed at the current state of affairs. as things currently stand, the entire swiss government nominal bond yield curve is in negative territory ( graph 2 ). most of the german, dutch, french and japanese yield curves are also in https : / / www. rba. gov. au / speeches / 2019 / sp - gov - 2019 - 10 - 29. html 5 / 18 10 / 30 / 2019 some echoes of melville | speeches | rba negative territory. the swiss government, for example, can borrow for 30 years at an interest rate of −0. 2 per cent. if it were to issue a zero coupon security at this yield, it would mean that the buyer would give the swiss government 106 swiss francs today and receive back just 100 swiss francs in 30 years'time, with no other payments between now and then. that is remarkable. there have certainly been other periods when real bond yields were negative, but such widespread negative nominal yields is unprecedented. graph 2 it is not just governments that can borrow at negative yields. over recent times, private companies including coca - cola, orange and siemens have issued unsecured bonds with zero coupons and negative yields. it has also become common for european banks to issue covered bonds with negative yields. and in denmark, at least one bank has offered residential mortgages at a negative rate of interest : −0. 5 per cent, although after fees the effective interest rate is just in positive territory. all up, there are now us $ 14 trillion of bonds trading at negative yields around the world ( graph 3 ). and around a quarter of all government bonds globally are now trading at negative yields. back in 1938, melville would have struggled to understand this. and, today in 2019, many people also wonder how things could have come to this. in a moment, i will offer some explanations. https : / / www. rba. gov. au / speeches / 2019 / sp - gov - 2019 - 10 - 29. html 6 / 18 10 / 30 / 2019 some echoes of melville | speeches | rba graph 3 before i do so, though, it is worth pointing out than even back in 1938, melville's views about zero interest rates were contested. following melville's article, brian reddaway and richard downing published a conflicting view in the economic record with arguments that still have resonance today. [

sector, making its macroprudential analysis very important but difficult to handle, statistically as well as conceptually. this situation presents extraordinary challenges for supervisory and regulatory authorities as highlighted in a fsb report to the g20 in october of last year, and, only recently, in the european commission ’ s green paper on shadow banking. the immanent concern with shadow banking is thus its lack of transparency. what are our options for the territory of shadow banking to be charted? shadow banking involves entities and activities outside the regular banking system, and statistical data collection in many parts is still quite sketchy. obviously, there is an urgent need for central banks to be given an extended mandate for the collection of data not only from banks but also from non - bank financial institutions. what can be done in the short term? as you know, there are two standard prescriptions frequently recommended as an initial remedy. the first of these is an extended analysis of flow of funds data. the second is an evaluation of counterparty information from balance sheet statistics. as regards the flow of funds, these transmit an idea of the main structures of the financial system : no more, but no less. building on this feature, the g20 data gaps initiative suggests that flow of funds information be amended by detailed sectoral accounts in the form of “ from - whom - to - whom ” tables, and, in fact, the imf has already presented a pilot by submitting a standardized report form, based on what they call the “ balance sheet approach ”. a similar project is under way in the escb with promising results. nevertheless, the critical point is that our basic statistics on financial institutions outside the regular banking system be improved. as regards counterparty information from balance sheets, these allow the mapping of exposures between the reporting institutions and financial entities elsewhere. in order to shed more light on shadow banking activities, a more disaggregated sectoral breakdown is needed. initiatives have been launched, for instance, in the context of the bis consolidated banking statistics, where we will see positions vis - a - vis “ other financial institutions ” being broken out separately. there also exists a considerably more ambitious attempt at collecting detailed counterparty data in some other bis surveys, notably the otc derivatives statistics, where you can find data on credit default swaps broken down, among others, into positions vis - a - vis insurance firms, spvs - and hedge funds. the problem here is that operational definitions − say