’ s june 19, 2013, press conference is available on the board ’ s website. bis central bankers ’ speeches implemented in as transparent and predictable a manner as possible. on this front, i think it is safe to say that there may be room for improvement. achieving the desired transparency and predictability doesn ’ t require that the wind - down happen in a way that is independent of incoming data. but i do think that, at this stage of the asset purchase program, there would be a great deal of merit in trying to find a way to make the link to observable data as mechanical as possible. for this reason, my personal preference would be to make future step - downs a completely deterministic function of a labor market indicator, such as the unemployment rate or cumulative payroll growth over some period. for example, one could cut monthly purchases by a set amount for each further 10 basis point decline in the unemployment rate. 10 obviously the unemployment rate is not a perfect summary statistic for our labor market objectives, but i believe that this approach would help to reduce uncertainty about our reaction function and the attendant market volatility. moreover, we would still retain the flexibility to respond to other contingencies ( such as declines in labor force participation ) via our other more conventional policy tool – namely, the path of short - term rates. thank you very much. i look forward to your questions. to be clear, i am sketching out a broad concept, and many details would need to be filled in to make it operational – such as, what to do if the unemployment rate falls in one month and then later rises. bis central bankers ’ speeches

slowed, and residential investment declined. business investment in equipment fell for the fourth consecutive quarter. a surge in exports supported growth ; however, much of the increase was in shipments of soybeans, while exports of other goods remained tepid. growth was also supported by a buildup in inventories, breaking a streak of five quarters in which inventories contributed negatively to growth, the longest such run in more than 50 years. overall, i expect gdp growth to continue at a moderate pace, supported by household spending, renewed business investment, and the waning effects of past dollar appreciation on export growth. i will now turn to inflation. headline pce ( personal consumption expenditures ) inflation has moved up this year, with the 12 - month change reaching 1. 2 percent in september. as the transitory effects of the earlier fall in oil prices and rise in the dollar fade, pce inflation can be expected to rise further toward our 2 percent target, supported by higher core pce inflation, which ran at a 1. 7 percent pace in september. as you know, earlier this week, we decided to keep the target range for the federal funds rate at 1 / 4 to 1 / 2 percent. as was noted in the federal open market committee ’ s statement, our assessment is that the most recent data have further strengthened the case for increasing the target range for the federal funds rate. 2 the markets put a probability of above 70 percent on the 1 / 2 bis central bankers'speeches rate being increased in december. so far i ’ ve been discussing our near - term economic prospects. but the more interesting and important questions relate to the next few years rather than the next few months. they relate in large part to the secular stagnation arguments that were laid out yesterday in larry summers ’ mundell - fleming lecture — in particular the behavior of the rate of productivity growth. the statement that the problem we face is largely one of demand — and we do face that problem — seems to imply either that productivity growth is called forth by aggregate demand, or a say ’ s law of productivity growth, namely that productivity growth produces its own demand. that is not an issue that can be answered purely by theorizing. rather, it will be answered by the behavior of output and inflation as we approach and perhaps to some extent exceed our employment and inflation targets. 1 views expressed are mine and are not necessarily those of the federal reserve board or the federal open market committee. 2 board of governors of the