scale and impetus of price adjustments, should a bubble burst. open pension funds are one of the main sources of demand on the stock market. from their very beginning, they have recorded average monthly inflows of pln 870 million, the value of equities in their portfolio have exceeded pln 51. 5 billion, whereas their share in free float has amounted to ca. 22 %. the assets held by open pension funds are likely to continue their rising path. as estimated, their credit debit balance will stabilize to report a balanced position only in 2031 7. in addition, the past quarters saw high demand of investment funds for equities. meanwhile, despite a large number of debuts, the value of equities introduced to the warsaw stock exchange is relatively low. by way of illustration, in 2004, the value of public offers amounted to pln 13. 2 billion ( including pln 7. 9 billion of pko bp's issue ) ; in 2006 it was pln 4. 2 billion, whereas in the first nine months of 2007 it was pln 6. 4 billion. the prevalence of sme sector in the structure of wse debuts is the factor behind these statistics. consequently, the supply - demand imbalance on the stock market was one of the reasons for the strong price rise, which may not always be explained by fundamental factors. for example, the p / e ratio for medium - sized companies included in the mwig40 index rose from 9. 0 to 34. 7 between january 2005 and june 2007, and this growth was even higher in the category of smaller companies. excess concentration of investments on a small number of markets poses a particular challenge, should an asset bubble develop and burst. this development would be the more dangerous that open pension funds cannot hedge their portfolios against the fall in prices. it is worthwhile to mention that pursuant to the regulation of the council of ministers of 13 september 2005 8, it was anticipated that as from 1 january 2006, open pension funds could take recourse to derivatives to provide hedging to their investment portfolios. regretfully, in december 2005, this regulation was repealed 9, and henceforth, as of today, should prices go into a significant decline, open pension funds have no other instruments to hedge the value of their portfolios but to sell some of their equities. given a high value of share portfolio, such a sale would significantly aggravate the decline. i believe that joint

imf participants ; whereas as per analyses of kelkar v. et al. ” the international monetary fund : entitled integration and democratization in the 21st century ”, presented at the meeting of g24 in manila, 17 - 18 march 2005, the total vote of brazil, china and india in international institutions is equal to the total of italy, belgium and the netherlands, whereas the total gdp of the first group of countries based on ppp is fourfold higher, with a 29 times larger population. chart 1. global demographic trends – the world population according to un forecasts lo – left axis ( la ) po – right axis ( ra ) africa – ( la ) europe – ( ra ) the rest of the world – ( ra ) asia – ( la ) north america – ( ra ) note : „ la ”, „ ra ” mean the left and right axis, data in million persons. source : the uno, http : / / esa. un. org / unpp / hence the demographic developments, supported by the globalization mechanisms which have led to the establishment of the global labour market, will drive asia and possibly some areas of africa to become fierce competitors for europe and the us in the forthcoming decades. there are many estimates that show the sizes of particular economies in the decades to come, based on demographic trends, assumptions concerning the long - term growth of performance, or changes in real fx rates. to give you and example, according to the estimates of pricewaterhousecoopers 5, by the buying power parity, in 2050 the chinese economy will be over 40 % larger than that of the us, india will catch up with the us, the economies of mexico and indonesia will outgrow that of germany, and the brazilian economy will exceed japan. we must ask the question whether the present economic policy in poland takes these facts into consideration. see the study by hawksworth j. ( 2006 ), “ the world in 2050. how big will the major emerging market economies get and how can the oecd compete? ”, pricewaterhousecoopers, march 2006. table 1 : estimated relative size of economies in 2005 and 2050 ( us = 100 ) country gdp according to estimates of the buying power parity usa japan germany china uk france italy spain canada india south korea mexico australia brazil russia turkey indonesia ( index for the usa = 100 ) gdp according to market us dollar fx rates source : estimates of pricewaterhousecoopers. according to a research of