us, and what they cannot. in addition, we plan to publish an article in the federal reserve bulletin discussing and interpreting the data. the article will be published at the same time that the federal financial institutions examination council ( ffiec ) publishes summary tables of the hmda data, in late summer or early fall. an institution that might soon - as early as today - have to disclose its own price data, should already have analyzed its data and be prepared to respond to comments from others interpreting its data. first, an institution should take the steps necessary to reach a high degree of confidence that its data are accurate. after that, an institution may want to determine how its data will appear to the public in the disclosure tables the ffiec will release by the early fall ; the precise formats of those tables were published in december. a lender may also want to determine if the hmda data reflect price disparities that are not adequately explained by other information in the hmda data set - such as income, loan size, and lien status - and, if so, to analyze those disparities in light of price variables known to the lender. the analysis could include a review of pricing discretion provided to loan officers. it also could include, where applicable, a review of the pricing patterns of mortgage brokers through which the lender has originated loans. should a lender discover risks in its hmda data, it goes without saying that the lender should manage those risks. as with other risks, those related to the hmda disclosures should be managed with an eye to the entire enterprise, including the bank and the non - depository affiliates. compliance with the bank secrecy act since the usa patriot act of 2001 significantly amended the bank secrecy act, compliance in this area has been a major concern for the banking industry. in large part, bankers ’ concerns center on the increased burden of complying with the additional requirements, the apparent lack of consistency in oversight and supervision, and law enforcement issues. the federal reserve recognizes that banking organizations have devoted significant resources to helping the government identify and prosecute those who are involved with the funding of terrorist activities, money laundering, and other crimes. but some recent events are affecting bankers ’ perceptions about their role in this critical area, and have raised serious questions about what bank regulators and other government authorities - most notably law enforcement agencies - expect of bankers. today, i want to provide some background information and describe what the federal reserve is doing, in coordination

with long - term rates falling sharply relative to short - term rates. 17 but in contrast to what we have seen with lsaps thus far, it was also associated with a to be clear, this argument relies on there being multiple distinct monetary assets. that is, the case needs to be that, for some investors, long - term treasury securities provide a type of service that is not provided as effectively by short - term bills or reserves. if all safe assets provide the same kind of monetary services, then an lsap that swaps reserves for long - term bonds has no effect on the net supply of monetary assets. see also woodford ( 2012 ) and krishnamurthy and vissing - jørgensen ( 2012 ). friedman ( 1969 ) famously argued that a socially efficient outcome involves setting the opportunity cost to investors of holding money equal to the marginal cost to the government of creating additional money. krishnamurthy and vissing - jørgensen ’ s ( 2012 ) analysis is based on market quotes from july 20, 2012. one obtains similar estimates if their methodology is updated to the present. however, it is important to emphasize that spreads of the sort they study can be subject to a variety of other idiosyncratic influences, so care must be taken not to over - interpret any one of them. see greenwood and vayanos ( 2010 ) for an analysis of the clinton buyback program and its effect on the treasury yield curve. bis central bankers ’ speeches pronounced increase in treasury - specific scarcity. one way this scarcity manifested in the data available at the time was in a widening of the treasury - swap spread, which rose rapidly after the announcement of the buybacks, and hovered in a range of 120 to 130 basis points in the spring and summer of 2000. 18 the lesson to be drawn is that we should continue to develop and monitor a variety of metrics of this scarcity phenomenon because they may provide an early warning if lsap costs begin to rise relative to benefits. for the sake of concreteness, i have couched the discussion in terms of a hypothetical all - treasury lsap. in light of our recent initiation of an mbs purchase program, it is natural to ask what the salient differences are between buying treasury securities and buying mbs. in my view there are two, both of which suggest that mbs purchases may offer a better cost - benefit profile than treasury purchases in the current environment. first, on the