to centralize operations of many of their mission critical applications, such as fedwire, automated clearing house ( ach ), and accounting. continued technological advance, as well as further consolidation in the financial services industry, is likely to lead to further specialization among regional federal reserve banks. new strategic planning activities in the face of accelerating change, the federal reserve recently recognized the need for a more comprehensive planning framework. in 1995, a system strategic planning coordinating group was appointed, consisting of board members, reserve bank presidents and senior managers, representing the full range of the federal reserve ’ s activities. this group produced an “ umbrella ” framework, designed to enable the board, the reserve banks and product and support offices to produce their own more detailed plans and decision documents under the “ umbrella. ” this framework, which is the basis for the document submitted to the house and senate banking committees, sets forth the mission of the federal reserve referred to above. it also discusses the “ values ” of the federal reserve, the goals and objectives of the fed, key assumptions, as well as the external and internal factors that could affect the achievement of those goals and objectives. with the overall framework as a reference point, strategic planning activities are proceeding with new energy at the reserve banks, at the board, and with respect to cross - cutting major functions such as the payments system and bank supervision and regulation. individual reserve banks have reviewed their operations from the ground up and reassessed their structure and effectiveness in carrying out their missions. some of the banks have launched fundamental re - engineering efforts that are resulting in substantial changes in management structure and operations. the federal reserve bank of chicago calls its effort “ fresh look ” ; the federal reserve bank of cleveland is engaged in “ transformation : 2000. ” board planning and budgeting at the board, we have restructured the annual planning and budget process to put more emphasis on planning ( and less on detailed line - item budgeting ), to lengthen the planning and budgeting horizon, and to involve the board itself more heavily in setting priorities. to this end, we have established a budget committee of the board ( consisting of myself and governors phillips and kelley ) assisted by a staff planning group drawn from across the major functions of the board. we are working with a four - year planning horizon and intend to produce the board ’ s first biennial budget ( 1998 / 1999 ) to go into effect on january 1, 1998. our hope is that the new process and structure will give the board a

banknotes, and it was hard to keep track of their value. in such a situation, at least, the reintroduction of legal tender in the form of digital cash might become a serious issue. robust payment systems are a crucial backbone of modern economies. we must be able to safeguard their functioning also in the future. about a week ago, europe experienced a short hiccup in the visa payment card network. even if the technical problem was solved in less than 10 hours, it showed how vulnerable our daily lives have become. when 75 % of payments are not working, a lot of uncertainty and losses are created. the event reminded us that, to ensure resilience, we need parallel safe infrastructures that can be scaled up, if the normal network is failing. today, we still have cash. if or when cash is no longer used to the extent that it can be easily scaled up, other alternatives will be needed. one line of analysis contemplates whether some alternative means of payment could or should be provided by central banks. 3. how are the efficiency of monetary policy and the objectives of macroeconomic and financial stability to be maintained, if all money is issued by private parties, all of which are not necessarily even banks? central bankers are often considered conservative. but work in central banks has had to continuously adapt to meet the challenges of a changing environment. the tasks of price stability, financial stability and oversight of payment and settlement systems tend to change and take on new forms, but the core content endures. this capability to adapt has been evident since 2008, when, during the financial crises, central banks were able to think ‘ out of the box ’ and create new monetary policy tools to fulfil their task. the outcome was not just new monetary policy tools, but also stronger macroprudential 2 / 3 bis central bankers'speeches supervision and, in europe, the creation of banking union. bearing that in mind, it is entirely reasonable to expect that the central banks will be able to adapt to the changing financial and payment landscape also when the driver is not a recession, but a technological revolution. dear friends, i trust your discussions today will be interesting and substantive, and that you will have new insights with you when travelling back home. sharing both understanding and open questions, being able to work together in the future and take action jointly, all these will be ever more vital when our common field of work is transformed in so many ways. i wish you a