agencies ― that helps different perspectives come together to create effective practices. 7 in addition to engagement with the public, the joint member agencies have continued their interagency collaboration. we have been working together to share information and help shape the most effective path forward for public policy. these actions include the signing of a memorandum of understanding that further facilitates information sharing related to the treasury market, and again co - hosting this conference. going forward, the staff of the joint member agencies will continue to work together on effective and comprehensive data collection, monitoring of market activity and liquidity through the interagency working group, development of principles and best practices for treasury market data transparency, and the regulatory framework for government securities. a main focus of recent work by the joint member agencies has been to improve the availability of information to both the official sector and the public. given this emphasis, it is worth spending a few moments discussing the benefits of obtaining timely and robust data on treasury market transactions. data are essential to understanding flash events and market liquidity. attendees at this 1 / 3 bis central bankers'speeches conference are very familiar with the events of october 15, 2014, when the 10 - year treasury yield experienced a 37 - basis - point trading range over the session. at that time, market participants struggled to identify what had caused that sharp movement. similarly, a flash event occurred in the british pound just this month. the pound depreciated nearly 6 percent, and then largely retraced this move within several minutes, seemingly without a major catalyst. once the domain of equity markets, flash events have happened with increasing frequency, also occurring in the dollar - yen and euro - dollar currency pairs in recent years. treasury and foreign exchange markets share a number of common attributes. they are evolving rapidly, they are highly automated in key market segments, and information on trading activity is not widely available. as a result, it is challenging for the official sector, market participants, and members of the public to effectively analyze these markets, understand the sources and risks of flash events, and evaluate how liquidity is changing. given the role of the treasury market as the deepest and most liquid fixed income market in the world, it is clear that both the official sector and the public need improved access to transactionlevel data, and i am pleased that we are making real progress on this front. greater transparency into treasury market activity is necessary in maintaining the market ’ s many important roles : as a risk - free benchmark for financial instruments

william c dudley : solving the too big to fail problem remarks by mr william c dudley, president and chief executive officer of the federal reserve bank of new york and chairman of the committee on the global financial system ( cgfs ), at the clearing house ’ s second annual business meeting and conference, new york city, 15 november 2012. * * * it is a pleasure to have the opportunity to speak here today. i am glad to see the progress our city and region have made recovering from sandy, but obviously significant challenges remain. i am going to focus my remarks today on what is popularly known as the “ too big to fail ” ( tbtf ) problem. in particular, should society tolerate a financial system in which certain financial institutions are deemed to be too big to fail? and, if not, then what should we do about it? the answer to the first question is clearly “ no ”. we cannot tolerate a financial system in which some firms are too big to fail – at least not ones that operate in any form other than that of a very tightly regulated utility. the second question is the more interesting one. is the current approach of the official sector to ending tbtf the right one? i ’ d characterize this approach as reducing the incentives for firms to operate with a large systemic footprint, reducing the likelihood of them failing, and lowering the cost to society when they do fail. or would it be better to take the more direct, but less nuanced approach advocated by some and simply break up the most systemically important firms into smaller or simpler pieces in the hope that what emerges is no longer systemic and too big to fail? 1 as i will explain tonight, i believe we should continue to press forward on the first path. but, if we fail to reach our destination by this route, then a blunter approach may yet prove necessary. as always, my views may not necessarily reflect those of the federal reserve system. what is the too - big - to - fail problem? the root cause of “ too big to fail ” is the fact that in our financial system as it exists today, the failure of large complex financial firms generate large, undesirable externalities. these include disruption of the stability of the financial system and its ability to provide credit and other essential financial services to households and businesses. when this happens, not only is the financial sector disrupted, but its troubles cascade over into the real economy. there are negative externalities associated with the failure