##ization, a country needs to carefully consider deficiencies in domestic financial institutions, corporate governance, and bank regulation and supervision. emergingmarket economies in which such financial market infrastructure is still in an early stage of development should consider the use of prudential regulations that discourage capital inflows, especially short - term capital flows, along the lines of the approach formerly in place in chile. such regulation of capital flows may be appropriate in the period before robust domestic institutions and sound policies are fully in place and tested by experience. the process the asian financial crises generated several initiatives aimed at preventing or better managing future crises. the academic and policy communities have sought a better understanding of the causes and transmission mechanisms of crises. there have also been initiatives to reform what has come to be called the international financial architecture. issues related to the prevention and management of emerging market financial crises have entered the agenda - - and sometimes dominated the discussions - - of the g - 7 in recent years. in addition, some groups have been formed specifically to study such issues. the g - 20, which includes finance ministers and central bank governors from major emerging - market countries in addition to the g - 7, was launched in september 1999 to facilitate dialogue between systemically important countries and to promote international stability. the g - 20 has recently focused on reform of the international financial architecture and the implications of globalization. i have participated in two of the new groups established in response to the asian financial crisis : the manila framework group and the financial stability forum. i represented the federal reserve at the first manila framework meeting and in the financial stability forum for the last few years. my focus in these groups has reflected my specialties at the board, including asia - pacific developments and bank supervision and regulation. the manila framework group was founded in november 1997, in the throes of the asian crisis, with the aim of restoring financial stability in the region. it consists of finance ministry and central bank officials from fourteen pacific countries, including the united states. the group has met twice a year and has undertaken a number of studies and launched cooperative ventures among its members. the financial stability forum was established by the g - 7 in april 1999, after the asian and russian financial crises, to provide a means for cooperation in the supervision of financial markets among national governments, international financial authorities, regulatory groups, and other experts. the forum's membership includes central bank and treasury representatives and a financial services supervisor from each of the g - 7 countries ; a single representative of a

, have social obligations to perform their work in a professional, competent, and ethical manner. 14. the results of statistical investigations are usually stated in numerical form and are, therefore, in the public mind, assigned a degree of definiteness usually associated with mathematical technique. the careful investigator, however, is constantly aware of the fact that the preciseness of his numerical result varies directly with the degree of care used in selecting, from the larger universe, the sample upon which his study is based. the numerical conclusions derived from a study of the sample are held to be characteristic and representative of the universe. a very common error in statistical investigation is the selection of a sample which is not an accurate cross - section of the larger universe but merely a particular, unique segment. conclusions drawn from the biased sample will not, of course, accurately reflect the larger universe. the misuse occurs when such conclusions are held to be representative of the universe by those who either deliberately or un - consciously overlook the sampling bias. 15. an article about cats appeared in the new york times ’ on august 22, 1989. it stated, “ the experts have also developed startling evidence of the cat ’ s renowned ability to survive, this time in the particular setting of new york city, where cats are prone at this time of year to fall from open windows in tall buildings. researchers call the phenomenon feline high - rise syndrome. ” statistics were like this : from june 4 through november 4, 1984, 132 such victims were admitted to the animal medical centre and most of the cats landed on concrete and most survived. from the data on the distance of the fall for 129 of the 132 cats, it was observed that the falls ranged from 2 to 32 stories. only one of 22 cats that plunged from above 7 stories died, and there was only one fracture among the 13 that fell more than 9 stories. but how a cat will survive of a fall from a great height defying gravitation? such description generally does not push one to scrutinize the statements till it was understood that majority of the cat owners do not report these incidents to any medical centre and believe that other people probably don ’ t report their cats ’ deaths, either. therefore, the error seemed so obvious that sample was not representative and there was data reporting problems. 16. let me cite another example on the wrong notion of conditional probabilities, which appear in statistical science 2005, a type of intentional and unintentional misinterpretation