repo market. but one needs to look beyond aggregate data to understand the full impact of the ecb ’ s app. 2 / 10 bis central bankers'speeches for example, there has been no overall fall in average euro repo market turnover since the great financial crisis. daily volumes in the repo market even rose in recent years, despite the considerable increase in excess liquidity. you can see this clearly on my first slide. according to mmsr data, turnover was close to €350 billion daily in the second quarter of this year, up from around €250 billion a few years ago. what has changed, however, is the type of transaction executed in the repo market. this you can see clearly on this slide and on the next. first, there has been a clear shift from unsecured to secured transactions since the crisis. second, as can be seen on the next slide, increasing excess liquidity has led to a notable decline in the share of trades backed by general collateral ( gc ), which is traditionally used to obtain funding for cash management purposes. this may suggest that proceeds from the sales of securities, together with the ecb conducting its main refinancing operations at fixed rate full allotment, have increasingly acted as a substitute for funding in the interbank market. at the same time, we have observed an appreciable increase in collateral - driven or specific repos. you can see this on the right - hand side. in other words, repos are increasingly conducted as a means to move securities among market participants, not primarily to raise cash. 6 there might be several reasons for this. smaller inventories held by market - makers after the crisis, for example, may cause them to source bonds in the repo market more often. alternatively, short - selling activity may have increased, a phenomenon often observed at, or close to, monetary policy turning points when investors expect yields to rise. one factor that is likely to have contributed to the rise in special repos is policy - induced scarcity, however. this can best be seen when considering the german bund market. here, our purchases have absorbed a multiple of net issuance in recent years, meaning that we have actively reduced the stock of outstanding bonds held by private market participants. the consequence is that investors in search of these securities increasingly need to pay a premium, a specialness premium, which, broadly speaking, reflects the costs of the difficulty in finding a lend

pieces before further cutting them into smaller slices. many industries were arranged and regulated along this line. for example, in the auto industry, a truck maker only produced trucks whereas a bus maker made buses only, and car maker manufacture just cars. furthermore, in the truck sector, production of heavy - duty trucks, light trucks and agricultural trucks were separated. if an enterprise wished to operate beyond one sub - sector, approval was needed, which was in fact very difficult to get. this was also true for foreign trade. in order to prevent competition and pricing problems among the more than a dozen state - owned trade companies, the trade business was carefully divided among them. for example, the national trading companies in china were established to specialize respectively in machinery, instrument, chemical products, textiles, silk, medicine, minerals, metals, edible oil, cereals and foodstuffs import and export. as the economy evolves, such segmentation increasingly became out of place in a market economy, nor was it contributing to competitiveness. in the financial sector, market demand for financial products has also changed. if we divide the financial business too much, this will affect the growth of financial institutions, and their ability to satisfy customers'need. of course, this may be convenient for the supervisors, because one supervisor only need to know one sub - sector. yet, regulation and supervision should develop with the times, along with economic growth. ii. in order to create a favorable environment to promote cross - sector operation, one need to properly understand the current situation and history. it is not easy to properly understand history. for example, in the aftermath of the great depression in the u. s., the 1933 securities act were adopted to provide for separate operation of the securities, insurance and banking sectors. but many years after that, efforts of revisiting the great depression found many other explanations of the crash. one of the conclusions is whether the financial sector was divided was not a fundamental factor contributing to the great depression, and consequently, the 1933 securities act was an misinterpretation of the history. indeed, those who have undergone the situation might not be able to properly understand it. there are both superficial reasons and deep rooted reasons for explaining the occurrence of an incident. sometimes, superficial reasons and deeprooted reasons are very different. furthermore, many economic problems are counter - intuitive. how to properly understand and interpret history will always be a challenge for economists and policy makers alike. as i have said