this is to strengthen the governance and monitoring of economic and fiscal policies. that does not mean to say that the functioning of the financial markets does not need to be substantially improved. at the moment, the key word for all industrialised countries is “ confidence ”. yes, but it is possible to speculate on whether greece will default. such a speculation would be a sure - fire way of losing money given the decisions taken last thursday. and let me say again, the euro, as a currency, is sound and credible, and is not affected by the pressures on sovereign risks. don ’ t the rating agencies play the speculation game? i think that this is an important issue for financial stability at the global level. here we see a very small number of institutions having an enormous international influence. the patently bis central bankers ’ speeches oligopolistic way in which the rating agencies work is certainly not optimal in terms of market organisation. this configuration is structurally “ pro - cyclical ”, in other words it fuels the creation of bubbles during cyclical upturns and exacerbates the busts during cyclical downturns. these failings must be addressed. this is easily said, and more difficult to do … you will be relinquishing your duties this coming november. what does this mean for you? my professional life has been shaped by both the pursuit of long - term or very long - term strategies such as the construction of europe and by a series of crises. when i started my career as a civil servant i had to deal with the first oil price shock in 1973 – 74, which was an enormous blow to the whole of the industrialised world. unfortunately, because we responded poorly, particularly in europe, this shock was the start of mass unemployment. i have also lived through the sovereign debt crises in latin america, africa, the crisis in the soviet union, the crises of the exchange rate mechanism of the european monetary system in 1992 and 1993, and of course the asian crisis, the bursting of the dot. com bubble and the ongoing crisis that started in 2007 – 08. the truth is, i have always been living through crises. this has led me to conclude that, in a world that is undergoing extremely rapid transformation thanks to science and technology, the global spread of the market economy and the fantastic progress made by china and india, it is necessary to be constantly on one ’ s guard and in a state of alert. i first elaborated on this view in a

or makes them larger. we address the risk of sudden surges in take - up in a couple of ways. for example, we can employ vigilant market monitoring to detect any such shifts and allow the fomc to formulate a response. we also use per - counterparty caps, and can use an aggregate cap. evidence to date on control now, let ’ s discuss what the data tell us about how well the framework performed. the distribution of traded rates in the federal funds market, shown in figure 1, essentially made a parallel shift higher after liftoff. these data are drawn from the new fr 2420 data collection i discussed earlier, and they show an average over all days from liftoff to this past wednesday, leaving out december 31. nearly all trading occurred within the new range – it ’ s normal for there to be a little bit above the range – suggesting that our framework was broadly effective in moving traded rates upward. because traded rates moved upward in this way, we have so far achieved an excellent level of control over the federal funds rate. since december 17, the day after the fomc meeting, the effective federal funds rate, calculated under its current methodology as a volume - weighted mean, has traded within the fomc ’ s new 25 - to - 50 - basis - point range on all but one day, which i ’ ll come back to. this is shown in figure 2. the rate has averaged around 36 basis points, about 25 basis points above its average level over the analogous year - ago period, when the target range was zero to 25 basis points. let ’ s consider the calculation of the effective rate for a moment. last year, we announced some changes to that calculation, the most significant of which is that, starting in march, we will switch to calculating it as a volume - weighted median using data drawn from the fr 2420 data collection, rather than a volume - weighed mean using data provided by federal funds brokers. the change in the data source was made to make the calculation process more robust. 28 we changed the calculation methodology because, while the mean and median are usually very close to one another, when they differ the median is a better reflection of money market activity, and because using a median enhances the reliability and integrity of the rate. 29 the new york fed published a technical note this past july that describes in detail the benefits of this change. 30 bis central bankers ’ speeches our recent experience has confirmed the expectation