targets and the monetary policy perspective and hence, makes various assumptions regarding the channels mentioned above. in case of an unpredicted development in one of the channels, the policy stance needs to be updated. monetary policy committee meetings and the decision - making process the monetary policy committee will continue to meet once a month in the upcoming period as it has done since 2001 and as stipulated by central bank law. the meeting will continue to be held in two sessions. the first session will start at 1 : 00 pm and will host the central bank authorities and specialists as well as authorities from the undersecretariat of treasury. in this session, the related bodies of the central bank will present their reports on evaluations about economic developments and inflation outlook to the monetary policy committee. at the same time, the authorities from the undersecretariat of treasury will present their evaluations on the developments in debt management and fiscal policy to the committee. in the second session, the committee members will make the final evaluations about the outlook and the decision will be put to a vote. after making a decision, members of the committee will prepare a brief report explaining the rationale of the decision. the decision and its rationale will be announced by the central bank in a press release before 7 : 00 pm on the same day, and it will also be posted on the website of the bank. a significant change in the upcoming period is that the turkish version and the english translation of the decision will be published on the same day. other policy statements and important dates the central bank will continue to publish main policy statements regularly in 2007 as well. within this framework : • the inflation report will continue to be published quarterly. • the financial stability report will be published twice a year on previously announced dates. • the statement entitled summary of the monetary policy committee discussions will be published within 8 working days following the meeting with the title summary of the monetary policy committee meeting, alongside its english translation. • as of july 2006 the “ price developments ” report started to be published to provide an accurate understanding of inflation data. this report will be published within 2 working days following the announcement of inflation data. • besides all these statements, presentations and speeches made by the governor and the committee members will be shared with the public from time to time. • moreover, the research papers, booklets, and technical notes published by the central bank and organized conferences will continue to be a part of the communication policy. the publication calendar for

that combines both price stability and financial stability as primary mandates even at times they conflict with each other and identify the policy instruments to target both. as you know central banks have typically used short - term interest rates as their primary policy instrument. however, the “ tinbergen rule ” suggests that this one instrument could be deployed to achieve only one target, which is conventionally recognized as price stability. addressing both price stability and financial stability simultaneously necessitates a second set of policy tools. this second instrument may be in the form of the supervision and regulation of financial activities. the question is that whether these responsibilities should be assumed solely by central banks. the downside of this option is that central banks may turn out to be too big, inflexible and in conflict with themselves, which eventually led to failure in both objectives. dear participants, prior to the global financial crisis, central banks were conducting monetary policy through conventional banks and use government bonds in open market operations. however the financial crisis led central banks employ a wider range of securities, ranging from corporate bonds to asset backed securities and mortgages. the reason behind this transformation was obvious. thanks to financial engineering and innovative products, only a small portion of financial institutions ’ assets is in government securities. therefore, asking for government securities as collateral in open market operations would no longer provide enough liquidity to the financial system. in the meantime, as banks have lost their dominance in the financial system, corporations and non - bank financial institutions have joined the conventional banks as the counter parties of central banks in market transactions. the question in this context is ( 1 ) whether the innovative policies we have seen in the last year will lead to longer - term changes in central banking doctrine and behavior, ( 2 ) whether in parallel to new developments in financial structure central banks will adopt a more flexible approach in operational practices, and ( 3 ) maybe more importantly whether central banks will maintain their influence in the financial markets, which has grown rapidly due to extraordinary actions during current crisis? these are important questions to discuss and i hope this conference would provide new insights to policy makers as we sail through uncharted waters. while concluding my remarks, i would like to extend my thanks to the members of the forum istanbul, who have contributed to the constitution of constructive criticism environment that i perceive as an important element in building the future of turkey. thank you for your attention.