stephen s poloz : engaging canadians – a # banknoteable process remarks by mr stephen s poloz, governor of the bank of canada, at the canadian museum of history, gatineau, quebec, 8 december 2016. * * * distinguished guests, welcome. welcome everyone. what a great day. a historic day. i would like to give a warm thanks to the young people who came this morning to take part in this event. i am very proud to be here with the minister of finance and the minister of status of women to announce who will be the canadian woman who will appear on one of our bank notes. the bank of canada is responsible for the design, production and distribution of canadian bank notes. and on bank notes, we can celebrate the diversity of canada ’ s culture and society. as governor of the bank, and along with carolyn wilkins, our senior deputy governor, i have long believed that it was time for a woman, in addition to her majesty, to be on one of canada ’ s bank notes. and we also heard from canadians who told us that it was long overdue. so i was very pleased when the minister asked the bank to move forward in our search to find the iconic woman for our bank notes. we started by asking canadians. and let me tell you. they told us. the response was amazing. within two days we received more than 10, 000 nominations. it became clear that this search for an iconic woman was engaging canadians in a very personal way. some people looked within their own profession : engineers googled women engineers. some of my economist colleagues searched for economists, computer scientists and statisticians. some people looked at their alma maters — notable women of queens, or mount allison or the university of british columbia. other people looked geographically, finding women who represented their part of the country. teachers used the nomination process as a way to teach children about canada ’ s history. school kids told us who they thought should be on the money. with every mouse click or turn of a book ’ s page, with every kitchen table discussion or classroom debate, canadians learned more about the women who built canada. we received more than 26, 300 submissions, resulting in 461 eligible candidates. then we turned it over to an independent advisory council. this advisory council, made up of eminent canadian academic, sport, cultural and thought leaders, carefully went through all the nominations. after much research and deliberation, they narrowed down the list of

are presumed to be desirable and based on fundamentals. but short - term flows are by no means all undesirable and destabilizing. and there is no way of discriminating between useful flows and destabilizing speculative ones. for example, because foreign trade and investment inflows and outflows are not always fully offsetting, short - term capital flows are typically needed to balance out a country ’ s external accounts. these capital flows occur in response to actual and anticipated movements in the exchange rate, and thus serve to smooth out exchange rate fluctuations. because such flows are often driven by small differences in perceived rates of return at home and abroad, they could well be discouraged by a transactions tax. on the other hand, speculative flows that actually “ bet ” on a sharp movement in a currency, have rather large expected returns and are unlikely to be discouraged by the tax. in the end, a transactions tax would likely increase, rather than decrease, exchange rate volatility, as well as reduce market liquidity and raise the cost of capital. needless to say, where financial market fluctuations reflect changes in domestic macroeconomic policies that put investors at greater risk than before, the tax would be aimed at treating the symptoms rather than the cause of the problem. in all, i find the case for a tax on currency transactions completely unconvincing. promoting greater financial market stability if a tax is not a good idea, how else can we promote greater stability in international financial markets and reduce potential disruptions to domestic policymaking? i have already talked about the value of a flexible exchange rate system in facilitating adjustment to “ real ” shocks and allowing national authorities to pursue an independent monetary policy. flexible exchange rates can also be helpful in moderating the size of, and aiding in the adjustment to, capital flows. in addition, governments are increasingly coming to the realization that the issue of international financial stability is best addressed not by retreating into isolation or by falling back on distorting, costly restrictions, but rather through sound and transparent domestic economic policies. international co - operation can also help. it can help by encouraging countries to pursue national policies that lead to economic stability, thereby reducing the risk of sudden changes in market sentiment and sharp exchange rate fluctuations. and it can help by setting widely accepted standards for transparency and disclosure. such standards should support more informed market judgments about the riskiness of investments, especially in emerging market economies, and thus help avoid the crises that can be triggered