no market value changes, that is, none of the key financial signals that determine who gets credit, and who does not, and hence who produces what, and sells to whom, in a market economy. in short, none of the financial infrastructure which converts the changing valuations of consumers into market signals that direct production for profit are available. but it didn ’ t matter in the soviet - bloc economies. few decisions in those centrally planned systems were affected by the lack of a developed financial system. that centrally planned economies, as a consequence, were highly inefficient is best illustrated by the fact that energy consumed per unit of output was as much as five to seven times higher in eastern europe and the former soviet union than in the west. moreover, the exceptionally large amount of resources devoted to capital investment, without contributing to the productive capacity of these economies, suggests that these resources were largely wasted. regrettably, until the berlin wall was breached and the need to develop market economies out of the rubble of eastern europe ’ s central planning regime became apparent, little contemporary thought had been given to the institutional infrastructure required of markets. nonetheless, in the years immediately following the fall of the berlin wall many of the states of the former soviet bloc did get something akin to a market system in the form of a rapid growth of black markets that replicated some of what seemingly goes on in a market economy. but only in part. black markets, by definition, are not supported by the rule of law. there are no rights to own and dispose of property protected by the enforcement power of the state. there are no laws of contract or bankruptcy, or judicial review and determination again enforced by the state. the essential infrastructure of a market economy is missing. black markets offer few of the benefits of legally sanctioned trade. to know that the state will protect one ’ s rights to property will encourage the taking of risks that create wealth and foster growth. few will risk their capital, however, if there is little assurance that the rewards of risk are secure from the arbitrary actions of government or street mobs. indeed, today ’ s russia is striving to rid itself of a substantial black market intertwined with its evolving market economy. law enforcement in support of private property is uneven in its application. private security forces, to a large extent, have taken over protection, with results sometimes less than satisfactory. the shift of vast real resources from the defunct soviet state to private parties, whose claims in many instances are

michelle w bowman : introductory remarks - fed listens event introductory remarks by ms michelle w bowman, member of the board of governors of the federal reserve system, at a fed listens event sponsored by the federal reserve bank of st. louis, st. louis, missouri, 4 september 2019. * * * in keeping with the purpose of fed listens, i would like to spend most of our time in conversation, but i do want to offer a few thoughts about why the fed is reaching out to seek a broad range of views, and what we are trying to achieve. this kind of comprehensive outreach on monetary policy is new for the fed. for many decades, there was a sense at the board that the public wasn ’ t interested or willing to dive into the complexities of monetary policy. that view has changed in a fundamental way, especially in the aftermath of the financial crisis when it was urgently important that the public understand what we were doing. so we began explaining as accessibly and clearly as we could what we were doing and why. now we are listening broadly as well. since i became a board member almost a year ago, it ’ s become clear to me that people not only are willing to engage on complex economic issues, they also want to know that their concerns are being taken into account on issues that affect their financial well - being. the movement toward greater transparency and public engagement is ongoing, and advancing that effort is one of my top priorities. at the same time, we recognize that clear communication of our policies actually helps us achieve our goals. when we communicate our views on the economic outlook and our expectations for where interest rates may be heading, consumers and businesses take that information into account when making decisions on spending, investment, and hiring. for that reason, our policy communications are themselves an important part of the fed ’ s toolkit for influencing the direction of the economy. fed listens is a natural outcome of this commitment to public engagement. we want to hear from people, from different parts of the country and different sectors of the economy, about how monetary policy affects them and their communities. it is our responsibility as a public institution to be accountable to the public. and, hearing a broad range of perspectives on these issues will help us make good decisions as we consider new approaches to monetary policy. this afternoon, individual stakeholders representing different economic sectors will meet to discuss their perspectives. later, president bullard and i will do what we came here to do, which is listen.