. " 18 also, to repeat myself, policies to boost productivity growth and the longer - run potential of the economy are more likely to be found in effective fiscal and regulatory measures than in central bank actions. this statement is true not only in the united states, but also around the globe. but it is not to say that monetary policy is irrelevant to the growth rate of the economy. references bernanke, ben s. ( 2005 ). “ the global saving glut and the u. s. current account deficit, ” speech delivered at the homer jones lecture, st. louis, april 14. — — — — ( 2012 ). “ u. s. monetary policy and international implications, ” speech delivered at “ challenges of the global financial system : risks and governance under evolving globalization, ” a high - level seminar sponsored by the bank of japan - international monetary fund, tokyo, october 14. — — — — ( 2015 ). “ why are interest rates so low, part 3 : the global savings glut, " ben bernanke ’ s blog, april 1. clarida, richard h. ( 2017 ). “ the global factor in neutral policy rates : some implications for exchange rates, monetary policy, and policy coordination, ” nber working paper series 23562. cambridge, mass. : national bureau of economic research, june. dottling, robin, german gutierrez, and thomas philippon ( 2017 ). “ is there an investment gap in advanced economies? if so, why? ( pdf ) ” paper presented at the fourth annual ecb forum on central banking, sintra, portugal, june 27. fernald, john g. ( 2015 ). “ productivity and potential output before, during, and after the great recession, ” in jonathan a. parker and michael woodford, eds., nber macroeconomics annual 2014, vol. 29. chicago : university of chicago press, pp. 1 - 51. fernald, john g., robert e. hall, james h. stock, and mark w. watson ( 2017 ). “ the disappointing recovery of output after 2009, ” nber working paper series 23543. cambridge, mass. : national bureau of economic research, june. fischer, stanley ( 2016a ). “ low interest rates, ” speech delivered at the 40th annual central banking seminar, sponsored by the federal reserve bank of new york, new york, october 5. — — — — ( 2016b

first, they can require disclosures by lenders that help consumers make informed choices. second, they can prohibit clearly abusive practices through appropriate rules. third, they can offer principles - based guidance combined with supervisory oversight. finally, regulators can take less formal steps, such as working with industry participants to establish and encourage best practices or supporting counseling and financial education for potential borrowers. in the area of disclosure, the federal reserve is responsible for writing the regulation that implements the truth in lending act ( tila ), known as regulation z. the purpose of regulation z is to ensure that lenders provide borrowers or potential borrowers with clear, accurate, and timely information about the terms and conditions of loans. the federal reserve is also authorized to write rules ; notably, the home ownership equity protection act ( hoepa ) gives the board the power to prohibit acts and practices in mortgage lending deemed " unfair " or " deceptive. " 6 both the disclosures required by tila and the rules developed under hoepa ( which is part of tila ) apply to all lenders, not just banks. in cooperation with the other federal banking regulators, the board can also draft supervisory guidance and back it up with regular examinations. supervisory guidance applies only to banks and thrift institutions, although state regulators of nonbank lenders can and sometimes do adopt guidance written by the federal regulators. in my judgment, effective disclosures should be the first line of defense against improper lending. if consumers are well informed, they are in a much better position to make decisions in their own best interest. however, combating bad lending practices, including deliberate fraud or abuse, may require additional measures. rules are useful if they can be drawn sharply, with bright lines, and address practices that are never, or almost never, legitimate. sometimes, however, specific lending practices that may be viewed as inappropriate in some circumstances are appropriate in others, and the conditions under which those practices are appropriate cannot be sharply delineated in advance. in such cases, supervisory guidance that establishes principles or guidelines is, when applicable, probably the better approach. guidance can be modified as needed to apply to different situations, and thus can be a more flexible tool than rules for accomplishing regulators ’ goals. as i noted, markets are adjusting to the problems in the subprime market, but the regulatory agencies must consider what additional steps might be needed. the federal reserve is currently undertaking a thorough review of all its options under the law. under