. au / speeches / 2018 / sp - ag - 2018 - 09 - 19. html 14 / 16 20 / 09 / 2018 money – born of credit? | speeches | rba empirical analysis that suggests that credit is a marginally more useful indicator of the near - term growth in the value of economic activity than money. references battellino r ( 2007 ), ‘ australia ’ s experience with financial deregulation ', address to china australia governance program, melbourne, 16 july. battellino r and n mcmillan ( 1989 ), ‘ changes in the behaviour of banks and their implications for financial aggregates ’, rba research discussion paper no 8904. black s, j kirkwood, a rai and t williams ( 2012 ), ‘ a history of australian corporate bonds ’, rba research discussion paper no 2012 - 09. bullock m ( 2018 ), ‘ the evolution of household sector risks ’, remarks to ai group, albury, 10 september. doherty e, b jackman and e perry ( forthcoming ), ‘ money in the australian economy ’, rba bulletin, september. flannigan g and a staib ( 2017 ), ‘ the growing demand for cash ’, rba 63 – 74. bulletin, september, pp flannigan g and s parsons ( 2018 ), ‘ high - denomination banknotes in circulation : a crosscountry analysis ’, rba, march. bulletin the grenville s ( 1991 ), ‘ the evolution of financial deregulation ’, in i macfarlane ( ed ),, proceedings of a conference, reserve bank of australia, deregulation of financial intermediaries sydney, pp 3 – 35. macfarlane i ( 1998 ), ‘ australian monetary policy in the last quarter of the twentieth century ’, shann memorial lecture, university of western australia, perth, 15 september. endnotes [ * ] i would like to thank emma doherty, ben jackman and emily perry for their excellent assistance in helping to prepare these remarks. indeed, i draw heavily on their work : doherty, jackman & perry ( forthcoming ). holdings of these forms of money by the government, residents of other countries and financial intermediaries that issue deposits or similar products are generally excluded from broad money. considerations such as data availability mean that there are some exceptions to this general rule. ‘ other financial intermediaries ’ includes registered financial corporations ( rfcs ) and cash management trusts. growth in nominal gdp will

the regulatory reforms that have already been broadly agreed, but being wary of adding further reforms to the work program. absent some major new development, which brings to light some major reform need not hitherto visible, to task the regulatory community and the financial industry with further wholesale changes from here would risk overload. lest this be considered too weak a position, let us remember how much is being attempted. and since we are already seeing the need to “ tweak ” some earlier agreed proposals, it is surely clear that the details of implementation should increasingly be our focus over the next few years. the g20 will need to remain open to the possibility – the likelihood even – that as experience is gained with implementation and we grapple with the inevitable difficulties, and as we learn more about how the financial the relevant standards are the fsb ’ s key attributes of effective resolution regimes for financial institutions. work is also underway by cpss - iosco to establish how best to apply the key attributes to financial market infrastructures. bis central bankers ’ speeches system is likely to operate in a new world, we will want to make occasional adjustments to the rules. none of that ought to be seen as a retreat from the high level objectives that have guided efforts to date : the desire for a more stable, more resilient and simpler financial system, that is better able and more inclined to play its “ handmaiden of industry ” role and better able to withstand failures of individual institutions. but in pursuing these goals, it is important that we : • strike the right balance between more regulation and more effective enforcement of existing regulation. inadequate enforcement and supervision was as big a problem as deficient rules • recognise the cross - border aspects of the financial system, with the associated need for cooperation and, yes, compromise. recognition of the legitimate interests of smaller markets is clearly of importance to australia but many other jurisdictions as well. this often coincides with the role of pushing for a principles - based approach instead of a one - size - fits - all heavy - handed, rules - based approach. it may also involve working to develop a “ regional voice ” on some issues • consider the combination of reforms in their entirety, and keep a lookout for unintended consequences. given the breadth and speed at which reforms have been introduced in recent years, careful analysis of how the various initiatives will interact is becoming more important. keeping the regulatory structure fit for purpose across a broad range of jurisdictions around the world is in fact a