countries would need to cease issuing physical currency on demand ( for example, in response to demands spurred by negative rates on so - called inside money ). 13 for all of these reasons, as a practical see alderman ( 2015 ). as an alternative to eliminating currency, a number of authors – including goodfriend ( 2000 ), buiter ( 2003 ), agarwal and kimball ( 2015 ), mcandrews ( 2015 ), and rogoff ( 2014 ) – have discussed various mechanisms that could effectively implement a gesell tax on physical currency. bis central bankers ’ speeches matter at least for the united states, it seems highly unlikely that the constraints associated with the zlb could be meaningfully addressed by steps to encourage a transition to a cashless economy. none of these options for dealing with the difficulties of the zlb suggest that it will be easy either to raise the equilibrium real rate or to mitigate the constraints associated with the zlb. but when the real rate is close to zero, even small effects can make a noticeable difference. and, of course, such issues are clearly worthy of additional research. how should central banks incorporate financial stability considerations in the conduct of monetary policy? the challenges associated with the zlb and the potential risks resulting from an environment of extremely low rates for a prolonged period of time bring me to the third question : how should central banks incorporate financial stability considerations in the conduct of monetary policy? or, put another way, can we conduct monetary policy in a way that reduces the likelihood of financial instability? 14 the first response of policymakers to the question of whether monetary policy – defined as the short - term policy interest rate – should be used to support financial stability is to say that macroprudential tools, rather than adjustments in short - term interest rates, should be the first line of defense. macroprudential tools are primarily regulatory or supervisory in nature and target specific activities, markets, and financial institutions. in the united states, we now have some experience with such tools. the interagency guidance on leveraged lending issued in 2013 and the annual coordinated stress tests ( the dodd - frank act stress test, or dfast, mandated by the dodd - frank wall street reform and consumer protection act of 2010 ; and the comprehensive capital analysis and review, or ccar ), focused on the capital adequacy of the largest banking firms, are two examples implemented for a few years now and for which data are available for an assessment

banking industry. this led to the creation of the csbs national survey of community banks. the survey gathered data and insights that were previously unavailable on this scale directly from community bankers. as a former state bank commissioner, i know how much effort community banks put in each year to provide accurate and detailed responses to the survey. we have all benefitted from and appreciate the insights they share. the survey has enhanced our understanding of how much the banking industry has changed. it has also provided data that have been used in academic research, policy papers, and official government reports. among its many contributions, the survey provides data on the costs of regulatory compliance and trend data on products and services being offered, and in some cases, discontinued, by community banks. the csbs survey also shows how competition has changed community banking in recent years. it is this topic of competition that i will focus on for the remainder of my remarks today. one of the more interesting findings from the csbs survey has been how community banks have reported changes in competition for both deposits and loans. although the majority of community banks report that other community banks are still - 3their primary competitors, that majority has steadily declined in each year of the survey as credit unions and larger banks have become the dominant competitors for deposits in an increasing number of markets. the situation is even more interesting for loan competition. each year, a larger percentage of community banks report fintech firms as their primary competitors for consumer loans, the farm credit system as their primary competitor for agricultural loans, and nonbanks as their primary competitor for mortgage loans. while not necessarily surprising, these and other data underscore that there is a new and evolving competitive landscape for banking services in the united states. as the nature of competition changes, it creates an opportunity for us to rethink how we evaluate bank mergers, how we define banking markets, and how we develop a more comprehensive understanding of the ways consumers and businesses access financial products and services today and how they might do so in the future. understanding the new competitive landscape so how has the competitive landscape for banking services changed in the united states? one of the most obvious changes has been in the number of commercial bank charters. in just 10 years, the number of bank charters has declined by approximately 20 percent. at the end of 2012, there were about 5, 900 commercial banks in the united states. the current number of charters today stands at just below 4, 800. this decline in charters has been concentrated among banks