richard w fisher : ¡ andale pues! having made the tough choices, mexico stands to benefit from reforms and navigate fed ’ s tapering with relative ease remarks by mr richard w fisher, president and chief executive officer of the federal reserve bank of dallas, before the association of mexican banks, mexico city, 5 march 2014. * * * the views expressed by the author do not necessarily reflect official positions of the federal reserve system. thank you, luis [ robles ], for that kind introduction. it is my great pleasure to be here tonight as the guest of the association of mexican banks and reunited with my colleagues from banco de mexico. i recently returned from europe, where i met with leaders from the european central bank and the national bank of switzerland. i am very grateful to governor agustin carstens for his hospitality. the federal reserve bank of dallas has enjoyed a long history of cooperation and consultation with the banco de mexico. i like to call banxico our sister bank. agustin himself spent some time at the dallas fed when he was a young man, and we take pride in playing this small part in his accomplished career. for many years, the dallas fed ’ s el paso branch has held joint board meetings and informational exchanges with the banco de mexico regional board of directors in ciudad juarez. now our branches in houston and san antonio are holding similar joint meetings with their banco de mexico counterparts. and governor carstens ’ predecessor, guillermo ortiz, is an advisory board member of the dallas fed ’ s globalization and monetary policy institute. the federal reserve bank of dallas and the banco de mexico enjoy a unique and mutually beneficial relationship. as guillermo and agustin well know, there is also a personal dimension to the dallas fed ’ s relationship with the banco de mexico. i grew up in mexico city in the 1950s, attending elementary school not far from here. spanish was my first language in school. to this day, i have many friends in el norte who say i speak better spanish than i do english, although that may be due to my texas accent. either way, i always proudly tell them, “ ¡ no hablo espanol ; hablo puro mexicano! ” this evening, i will do my level best to speak to you in espanol mexicano rather than in ingles texano. unprecedented u. s. monetary policy as you surely know, and as i am happy to report, the federal open market committee ( the “ fomc ” ),

had far - reaching effects on the state. texas alone now produces more oil than mexico, more gas than canada. while oil and gas industries directly employ only 2. 5 percent of texas workers, the energy sector as a whole accounts for over 10 percent of annual output. downstream operations – our gulf coast refineries – are booming, and gasoline and diesel exports have skyrocketed. while the texas economy is well diversified and no longer stereotypically dependent on energy, oil and gas provides a not insignificant impetus to the texas economy and helps differentiate us from the rest of the united states, as does our state government ’ s approach to pro - business regulation and taxation. to give you an idea of the growth differential with the rest of the nation, texas employment has grown 2. 5 percent per year during the economic recovery, which is about a percentage point faster than the nation. state gdp has averaged 4. 2 percent annual average growth since 2009, compared with 2. 2 percent in the u. s. texas exports have increased 79 percent since their low in 2009, compared with 35 percent in the nation. all this economic activity is finally spilling over into wages, which are rising in texas as they remain flat in the rest of the nation. as you can imagine, job opportunities and rising compensation have made texas the no. 1 destination for interstate moves in the country. since 2006, texas has averaged 150, 000 newcomers per year who are relocating from other states. this is in addition to international migration, which is still high but has decreased from where it was before the crisis. this is what i see for mexico. structural reforms – handled judiciously, especially as u. s. economic growth accelerates and europe recovers – can pay off in spades for the mexican people, who deserve it many times over. while mexico has somewhat reduced its dependence on the u. s., 80 percent of exports still go to el norte. in a strange twist of fate, it may be helpful in the near to medium term to be exporting manufactured goods to a slowly recovering u. s. and europe rather than maintain the last decade ’ s shipments of raw materials to china as in the case of brazil. bis central bankers ’ speeches mexico has emerged i began my talk tonight by running through the events, institutional backdrop and the thinking behind the fed ’ s quantitative easing efforts. i clearly have not been onboard with all the decisions the fomc has taken during the economic recovery. i fear