that the evolution of these new, complex instruments has been a negative development. indeed, these instruments have allowed the separation of different types of risk, such as credit and market risk. this has promoted better risk - management practices, and has allowed different types of risk to be borne by those best able to do so. securitization has encouraged innovation and enhanced the ability of the banking sector to originate new loans while remaining well capitalized. the final point to make in terms of the causes of this summer's turbulence has to do with how these complex securities are valued. trading of these securities in the secondary market is rare and, if trading does occur, it takes place in the over - the - counter market. as such, prices for these securities are not very transparent. most of these highly structured securities are valued on a " marked - to - model " basis, meaning that statistical models are used to provide values. but the models typically provide only estimates of values, and these estimates can vary widely if there are changes in the assumptions on which they are based. indeed, many of the models assume that the assets underlying these securities can be readily traded in a liquid secondary market. in august, it became clear that this assumption would not always hold. so, we can now see many of the factors that made credit markets vulnerable to this summer's dislocations. the re - pricing of risk i mentioned earlier was, in fact, under way before august. by late spring, the spreads on lower - rated corporate bonds had begun to widen to levels that were closer to historical averages. as we moved into summer, however, we saw rising delinquency rates and higher probabilities of default on u. s. subprime mortgages. and so, there were rising expectations of losses for holders of securities backed by these mortgages. but because of the complexity and opacity of some of these securities, it was extremely difficult for investors to determine, with confidence, both the creditworthiness of the assets backing a particular security and the market value of the security itself. in these circumstances, uncertainty led to contagion and dislocations in money markets more generally, even those markets that have nothing to do with u. s. subprime mortgages. market liquidity, which was recently thought to be too abundant, became scarce. some investors found that the assets that they assumed were liquid were, in fact, frozen. even the market for overnight

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