 Thank you, Erky, and it's great to be here, and I'm sorry I missed the rest of the program So forgive me if I repeat what some other people said and I certainly so I've been asked to address three Topics one is the effects of transparency on the deliberative process a second one is Transparency and the fiscal effects fiscal risk that Erky was just talking about and the third is transparency communications and the support for Independence building trust in the institution, and I'm going to do this primarily from a US perspective That's my 40 years of experience, and that's what I feel comfortable talking about I'll bring in some other things from time to time, but basically this is about the US experience So I certainly start from the same premise that Erky said was the consensus Earlier today that is more transparency and communication is generally better in terms of promoting accountability and policy effectiveness But it needs to be the right kind of transparency and Communication it needs to promote an understanding of what the central bank has done Why it's done it and what it's likely to do in the future It needs to reflect the underlying uncertainty in the economy and in monetary policymaking I Think it's there are a number of challenges here in addition to the underlying uncertainty And that one challenge which I'm I'm guessing was discussed earlier today But hopefully you get in this panel is how much weight to put on Individuals and individual policy makers and their views and how much weight to put on the center of gravity of the committee The consensus of the committee, and I think it's very hard to get that right there are potential costs to Too much transparency One is giving the wrong impression about what or the wrong kind of transparency about what actually the central bank is doing And why it's doing it and a second one is it might have an effect on the deliberative process So which I'll get into a second But I think every step in transparency every new step needs to be subject to a cost-benefit analysis And you don't know what the costs are going to be you don't know what the benefits might be But I think you got to think about it that way and in particular Every step we take as central banks is pretty much irreversible. It's hard to take it back once you've done it So it's really important to think about both the costs and the benefits of taking an additional step in transparency Let's talk about the deliberate of process the first job of monetary policy is to get policy right All right, so to the committee must get it right. They must meet their objectives That's what you were formed for the objectives were given to you by the legislature or the treaty as the case might be So that's your first job. I think the odds on getting it right are increased When there's full and open discussion in the policy committee with a free flow of ideas where alternatives are considered and mechanisms are in our embrace to find consensus or Allow allowed the sense but to work through those alternative perspectives and alternative views have an exchange of views and I think being open and Transparent as possible about that process about the deliberate process the exchange of views the alternatives is Very very helpful promoting both the accountability and the policy effectiveness goals of transparency and communication The quality of the discussion is a very important part of Accountability when central banks take actions It may be a long time before the actions are felt it made other things may influence the outcomes so one way that the People in a democracy have to judge how well a central bank is doing by is judging the quality of the discussion Is it bringing the right things to bear as it having the right kind of discussion and and knowing that will promote confidence? It will promote support for independence Especially by knowing diverse views are presented and how they were worked through And it also obviously promotes policy effectiveness where markets understand the reasoning process and how the central banks are making the decision How best to do this so I think it takes I Don't think you can really promote a lot of understanding in three minutes on CNBC or Bloomberg. I Think that tends to there are probably people here from CNBC and Bloomberg and I I'm not going to apologize. That's my view I think it promotes kind of the gotcha moment and the the very very People trying to move markets the reporters or the people trying to move markets I think it takes a bit of a longer form to get through a real understanding of what the What the monetary policy process has done longer speeches press conferences where there can be give and take And I think most importantly the minutes of the policy meetings are really important Because minutes are a document of the committee They should reflect the diversity of use that come to to come into the committee And they should give how that diversity was worked through to get the answer and why the committee arrived at that Answer, but it's challenging and I think a particular challenge in minutes Is the balancing of the individual views and the committee and the committee views and here I'm going to pick a little bit on the Federal Reserve and the ECB So the Federal Reserve I think gives And the way I framed this in my own mind was forest and trees So is there enough information to give a sense of the overall forest? How the committee reached its consensus or is there too much information on the trees? How the individuals looked and I I think in both cases they could use some thought about this about this balance Of course the Federal Reserve Seems to have evolved in a way in its minutes put on a lot of a lot of emphasis on a few people said this some people said that a Few more said this several said that and a lot of interpretation I think when I get finished reading Parts of those minutes. I think well I kind of understand that the first views that came to bear But I'm not quite sure how the decision actually came out of this thing and having sat in Probably hundreds of FOMC meetings. I know that for the most part. Yes, there are dissents and alternative views Over time a consensus tends to form there is a center of gravity in the committee and I worry sometimes that putting so much emphasis on individual views Misses the center of gravity that comes out of the comes out of the FOMC meeting and I also wonder whether it Feeds back on the deliberative deliberative process So if you're sitting in there and you want to make sure that the views you have are represented and the count is accurate Everybody has to comment on almost everything so that a few mean something and many mean something and I It's this is it's been seven or eight years since I've been in one of these meetings but I have a sense that the minutes may contribute to the length of the meetings and the difficulty of coming to a consensus I had the other Reaction reading the ECB minutes and I must admit I'm not a I'm not a regular reader of ECB minutes. I consulted with the ECB staff when they Went down this path. So I read the first one and I read the ones that just came out For the last thing the ECB avoids a few many several by using the passive voice So there are no actors in an ECB meeting. It's all it was noted people, you know So they don't and and it feels to me like there's an occasional view was expressed and Even a view was reiterated and I thought I could identify that one but I Wonder in reading the ECB minutes whether I'm getting enough of a sense of the diversity of views that come into the Into the decision process Because there's so much emphasis on the the consensus that comes out so I think both Both Both institutions probably need to work a little bit on getting that balance, right? let me finish the decision-making Process thing with something about transcripts. So here's an area where I think the cost succeed the benefits I think about the FOMC before 1993 and after 1993 when those transcripts started To be published there were benefits of publishing the transfer Transcripts for the deliberative process I think some people who kind of didn't really participate very much from time to time made sure they participated and made sure they were well prepared because they knew someone would be Reading their words in five years But I think the cost outweighed those benefits there was a shift to reading Statements rather than reacting to what you heard There was much less give-and-take much less testing of ideas Reacting to what others said trying to figure out where to go The meetings became much longer as everybody commented on everything and I suspect it contributed a little bit to more action Before the meeting rather than in the meeting So I think the transcripts have been a net negative for the deliberative process at the Federal Reserve. I know what's It's not reversible But I think the rest of you be what it should think very very hard before you go down that path Let me say a few words about the fiscal effects of monetary policy and the rebuilding trust So on the in the case of fiscal risk and monetary policy Here's one where I think more is better more communication is better. You've got on an unelected technocrats Playing with the public purse Yes, all monetary policy has fiscal effects of one sort or another just raising and lowering that interest rate but the unconventional monetary policies where institutions built bought assets in a sense longer term assets financed by Reserves remunerated an overnight basis. So doing a carry a huge carry trade Maturity transformation made loans to a variety of private firms. Yes collateralized But also made those loans. I think took the central banks into a new area of fiscal potential fiscal effects I Think there was and I was actually surprised when I left the fit in the fall 2010 How much interest there was in this? Outside the Federal Reserve. So what's going to happen when interest rates turn around? What are the risks on the on the FOMs on the Federal Reserve's balance sheet? How's this all gonna play forward and there was I think in the Fed anyhow, and I Partly responsible while I was in there a holding back on the discussion of fiscal risk For fear that it would undermine public support for the unconventional unconventional programs, but it bred misunderstandings and a sense that the Fed hits was hiding something So it took a couple years for the Federal Reserve to be To start publishing a staff study which really looked at this very very carefully So I think you'd need the central banks need to acknowledge that there might be some fiscal risk And I think particularly about risk so the the there are mitigants to this collateral when you're lending etc, but The second moment of this thing the fact that Prophets could go up or down the what you read remit to the Treasury could go up or up or down I think needs to be acknowledged that dispersion of outcomes as well as the expected gain or loss So it will vary over the cycle. I don't Wonder whether when central banks emphasize that they're making a lot of profits now So you shouldn't worry about losses later whether that's the right Thing to do so yes, you should talk about how this might vary over the cycle but the central bank is not a profit wasn't there to make profits and When you start playing that game well, we may make some losses later But we've made some profits now It's the right thing to point out but in the sense you're playing on a ground that is profits and loss That really you really shouldn't be playing on it's central bank is about Monetary policy and hitting legislative goals. I think you need to be very careful about that on the rebuilding trust issue just a Minute or two on that so here not what and Protecting independence my emphasis here is not so much on what is said but who it said to so it sounds like from Eric's introduction there was some discussion of this this morning reaching out beyond the traditional bubble That the central banks talk in a financial markets some academics the financial press a Few legislators a few CEOs. I think to build trust And restore trust and to protect independence We need to reach out as far as possible in general public either You know, perhaps not a lot of general public that are really interested in this But I think broader TV than Bloomberg and CNBC so Ben Bernanke's Peace on 60 minutes was a good idea regional news outlets I see Andy Haldane sitting out there. I've appeared in the Leeds whatever it is and the Newcastle Whatever as a member of the FPC. So there's there's a Effort in the Bank of England to go out to the regions from the center and talk to the regional news outlets And I think that's a good idea the Fed relies on the Reserve Bank presidents to a considerable extent for this But the Reserve Bank presidents I think don't always represent the center of gravity of the committee And they don't always reach out the way they should so I think the protecting independence rebuilding trust Requires going over the heads of the legislators to the people they represent as much as possible. Thank you