informative, verifiable and not vulnerable to manipulation? if you manage to come up with one, how do you migrate the trillions of dollars of existing contracts to the new standard? the u. s. unemployment rate has declined more sharply than one might expect given the economy ’ s growth rate over the past few years. is this permanent or will it reverse if the economy continues to grow and the pressure on labor market resources increases in the coming years? how does one end “ too big to fail ” for large global firms operating across different jurisdictions? the list goes on and on. there is plenty to work on and think about. finally, let me take up one other question that stan has posed : do i think you need to be an economist to be the president at the new york fed? i don ’ t think so. if you look at the past five presidents – volcker, corrigan, mcdonough, geithner, and myself, some have been economists, some haven ’ t. yet i think all my predecessors have been very effective. i think there are other attributes that are more important than being an economist : 1 ) an analytical orientation ; 2 ) the ability to synthesize a broad range of material so as to understand the interactions of markets, financial institutions, and regulatory and macroeconomic policy ; 3 ) open - mindedness and pragmatism – the world is complicated and ever changing ; and 4 ) the ability to lead – that means identifying the key issues and motivating people to do their best work in order to develop new insights and approaches. having an economics background probably helps, especially on the analytics side, but, in my view, is by no means necessary and certainly not sufficient. one point on which i am certain is that regardless of the background of the president, having a very strong research group is essential. thanks for your kind attention. bis central bankers ’ speeches

any other type of credit. over the same period, institutional investors have broadened the allocation of their assets, particularly with respect to investments abroad which have grown from 8 % to 19 % of their assets between 2005 and 2015. however, they have so far not taken much part in the retail credit market, either in mortgages or in consumer credit. the truth is that it is not typical for large asset managers in developed countries to enter the retail lending market. institutional investors in israel have entered the corporate debt market during the past decade, despite the fact that this sector shrunk as a share of gdp during that period. so we know that retail lending has been growing, but it is dominated by the banks, while corporate lending has not been growing as a share of gdp and has been the subject of competition between institutional investors and banks. what about small businesses? first, the importance of small businesses in the israeli economy is similar to that in the other oecd countries, in fact a bit larger, constituting 42 % of business sector gdp – a significant part of the economy that could be a source of economic growth. the banks increased the volume of lending to small and medium businesses from 36 % of banks ’ business sector credit to 44 % between 2011 and 2014. an international comparison is difficult because the distribution is very wide. what about pricing? well, the smaller the business, the higher the interest rate it pays. does this reflect the risk involved or market power? what is clear is that profitability over the past 4 years has been much higher in the household and small business sector than for other types of credit. even if we take into account that these years are upcycle years, and profitability is likely to be affected negatively in a downcycle, there are good reasons to believe that the higher pricing is in part due to market power. recent legislation and regulatory changes will tackle this problem and should bring the institutional investors, to that the small business and household credit market as well. the establishment of a credit registry tackles the problem of asymmetric information, while the legislation enabling securitization will allow institutional investors to enter the retail market indirectly – as it is done in many other places in the world – by connecting institutional capital with the banks ’ ability to grant credit, which will lead to an expanded supply of credit and lower financing costs. bis central bankers ’ speeches