prices ( henry hub ) have declined from over of us $ 12 per mmbtu in june to an average of us $ 6 per mmbtu in december 2008. several planned investments in the sector have been postponed because of financing problems or market uncertainties. we have also seen an otherwise struggling stock market take a sharp drop – by 27 per cent – between june and december 2008. our households, like those elsewhere have observed financial turmoil abroad and have become more cautious – much to the disappointment of the merchants who were depending on christmas sales for a large part of their income. there are indications of a marked slowdown in housing activity, in part due to high interest rates but perhaps more so as a consequence of the unwinding of the construction and real estate boom of the last years. in addition, our manufacturing sector has begun to face the impact of the declining external and domestic demand. it ’ s amazing how it takes difficult times like these to appreciate the inter - connectedness of our economy. a fall in demand and energy prices affects not only the large energy companies but a whole host of smaller companies and entrepreneurs who provide services to these companies. the energy sector also accounts for an important part of construction and thus the downturn in the sector exerts a downward pull on construction activity. the manufacturing sector is being affected by a fall in demand from regional markets and the slowdown in tourism and construction. since the non - energy sector is the major generator of incomes, its fortunes have a ripple effect on private demand and on the overall level of investment and employment. and this brings us to the role of government in the present scenario. as you know, over the past few years, the government has taken an active role in promoting economic transformation, including through a significant increase in expenditure on infrastructure and social services. in addition to serving as a catalyst to growth and capacity expansion, government expenditure has also contributed to an unacceptable surge in domestic inflation ( aided no doubt by an unprecedented increase in international food prices ). conscious of the need to reduce inflation the government initially sought to match a projected reduction in energy sector revenues by a compensating cut in expenditures. thus, on november 30, 2008 in response to an expected shortfall in energy sector revenues of tt $ 5. 3 billion, the government announced expenditure cuts of tt $ 5. 0 billion. yesterday the government announced that as a result of the continuing fall in energy prices the revenue shortfall is likely to be some $ 2. 3 billion

sabine lautenschlager : interview with politico interview by ms sabine lautenschlager, member of the executive board of the european central bank and vice - chair of the supervisory board of the european central bank, with politico, conducted by politico on 14 january 2019 and published on 17 january 2019. * * * are we heading for a clash between regulators and banks? no, i don ’ t believe so. firstly, the kind of increases in capital requirements you will see are an improvement of the rules in regards to risk sensitivity, which are very bank specific, depending on their business model. it is not an average increase of capital for all banks, as such. second, the basel implementation is spread over nine years until 2027 — nine years! are banks overplaying this? i think that most of them are overplaying it. you always need to look at whether risk sensitivities are considered adequately. but that is up to the supervisor. the rules in basel are general abstract rules. former ecb executive board member vitor constancio warned against the risks of shadow banking, and luis de guindos has continued along that line … i fully agree with him. as banks are regulated more strongly, some business has become much costlier for them to take on. a lot of business moved over into the shadow banking sector, which is interlinked to the banking sector. this is why this sector is so important to look at, not as a banking supervisor, but from a financial stability point of view. for me, the first step would be to ensure that you have much more knowledge about a sector that is growing and increasing in importance. they influence liquidity in some asset classes in the market and might thus have strong implications for financial stability. how do we do that? stronger disclosure rules? i would first like to know what is the exposure, what is the risk, what are the interconnections in the sector. then i ’ d ask myself, do we need more rules? so, more reporting, yes. a different way of reporting. because the current setup is insufficient? yes, it is insufficient. somebody has to look into it. if these are global players, perhaps the global standard setters should look at it. and not only in a static way. the mistake you should never do is only to look at what you have in your balance sheet. you also need to look at the flows in