 Thank you very much. You've mentioned Germany a couple of times and so I thought I'd Bring in the chairman point of view. I'm Austrian so I can say Things that the Germans don't like to hear nonetheless So about the chairman banking system. Yeah, so there is there's a narrative that they hear all the time They say though the interest rates are so low And the margins are so low and then there's regulation that doesn't allow us to to take fees and and that squeezes our Our income statements. I think that is there is some truth to that but What is much more striking in in Germany really is that the amount of Delaveraging that we have already talked about was just immense, you know, and the IMF has criticized the Germany Germany's family owned companies recently this gave rise to almost Rebellion no, they don't didn't like it at all But those family enterprises have financed the investment they did almost entirely out of returned of returned Profits and not going to to their banks what they did Typically over the history of German capitalism or or go to to public markets. So it's retained earnings and Investment per se has been low. So the little investment has taken place was was financed by Retrained profit. So that's that's the first thing the second the comment I'd like to make is that we are we are in Germany Now in the process of getting serious with the carbon price for the non ETS segment so for cars transportation and for buildings and the idea of a CO2 central bank is quite present in the discussion I'm happy to hear that Golié has written about that But there's also it's also part of the proposal of my institute and it's a part of Something that the peak Institute to be climate change think tank and Berlin has advocated So there might maybe something that we should pursue French and German economists and the third point about the the Phillips curve So there's an interesting observation. It's also just a couple of weeks old There's been a revision in the chairman national accounts and that shows that today The share of wage income over GDP is where it was in 1992 So we had actually a relatively Strong recovery of the share of wages in national income from 2010 to today So there has been wage growth at the same time the capital share has been squeezed and that you know So that's maybe another side effect of low interest rates or flow of low capital costs So that that in total value added more could be paid out to to workers without prices going up because the additional wage can't just be did for by by firms. So These are three points. Thank you very much Thank you very very much and forgive me if I I was alluding to the German citizen Yeah, please Thank you very much Allow me please to speak in French to be very concise and very precise I beg your pardon. No, I'm sorry because we have no translation. Yeah, so Unfortunately, I will try but I beg your pardon for my broken English What I Will try in English if you try English, I'm sorry to say that as a French. I am ashamed to say No, two or three ideas, I'm very impressed but Ellen ideas of carbon-central Bank yesterday we heard about the amount of Currencies circulating In the in the world I Read some weeks ago about some look very localized currencies to enhance Circuit cool Very short circuits Do you think I'm just asking I have question I have not idea to propose to this distinguished panel, but my question is today and also we my opinion is the trade war dispute between United States and China is suit on the By currency underlined by currency war also is Those ideas is today Can the world is the world really for International central bank. I I see what you mean. I see the question It seems to me that we cannot speak of currency words when when the renminbi is Itself not a convertible currency So at this stage the renminbi not yet in at the core of the international system Still of course it is a currency, which is very very closely managed and in a way it is Trump Trump has declared that at least part of the currency war is with the EU I mean his view is and and you can see the the logic of it his view is that the the ECB's monetary policy from the standpoint of the US and international markets is Aimed at keeping the euro weak and keeping dollars strong And you know if you can look at the big Mac index and see that we have an unprecedented circumstance in which but basically every currency in the world except Norway's Krona and the Swiss franc is Substantially undervalued quote-unquote relative to the dollar. So so there is I mean in Trump's mind There's a currency war and it's with Europe Yeah, but but I would totally disagree of course both with Trump But I'm just saying if you want to understand the nature of the conflict. Yeah, it's important to understand whether I think of course Of course, so do we have all the comments on that particular point? Yeah, please Are you want to respond to some of the panelists? So I think let me first check whether we have other questions from the participants that are not speakers. Yes You have the floor. This is not a question Just comment on the chairman's discussion about the coordinated approach to inflation or deflation And we had a very good experience in 1970s where government just requested just Lowering the increase in wage and that can income policy But we did the same effort this time on the opposite directions I mean the Prime Minister just mentioned many many times to the private sector to raise wage, but never Successful so there seem to be some kind of a symmetry About just a decrease or increase for this kind of policy And also one more point of many people just say because just interest rate is so low There's no opportunity for more Military policy. So why not just the fiscal policy now? Let me just mention the case of Japan We did have a very strong military policy But because of that maybe the almost full employment So demand is enough so far in Japan the problem is just total factor productivity growth rate is shrinking So obviously it just means surprise side policy become more important The problem is surprise side policy is very difficult because the government to reach is very much limited So without discussing surprise side policy or at least just increasing productivity Especially in the face of the declining real interest rate We cannot just get out of this kind difficulty Maybe demands duration is necessary under circumstances of certain degrees of the global demand But still surprise side is so important at this moment. Thank you Thank you very very much for these remarks, please Yes, thank you. We we have very interesting ideas and suggestions and Of the innovation finance today, but just I'm wondering about the way We can sell some ideas to politicians We have today and what kind of politician we have what kind of dialogue we can have when you talk about inflation and We understand today that the weakness of the union in different countries and politicians This is what we have the case of GM in the United States about it And it's very interesting to observe the way maybe this something is going on It is new is going on But it is if we have this those ideas and it is it's for me It is I will see very interesting technical I will see proposal or suggestions or adaptation to the situation today But who will apply those policies there's politicians And what is the link we have and we can have with position today? And if we come back to the crisis 2008 it was completely different because we have some I will see Leadership world leadership we have and it was say that today we don't have this kind of leadership It is completely different to dilute and between different person with different completely opposite Ideas this is what this is a question mark we have This is pure brainstorming session Again, I made the rapprochement between the populism and the political pressure Gigantic political pressure on the political sphere So there are leverage or there is leverage to perhaps to go in the direction that witches and saris could be more dynamic and to the Japanese example, I would also say I fully agree that if you want to have the various corporate businesses on board it has to be done Nationally and also within some kind of framework international framework and It happens It is a miracle that all central banks of the advanced economy have now the same definition of price stability Namely 2% so it could be an argument at the level of the G7 whatever at the level of the G20 To go further, but again, I dare say that because I said we have the right to do anything to say anything Please you have the floor. Well, thank you very much All day yesterday and today I suppose the most often heard words were the US China trade conflicts if you see that in the in the context of all in in relation with Underline hegemony competition Then I think in this session very session finance and economy should be really more worried about the global order and International economic cooperation So in that regard I would like to make Observation in the comments since G20 was mentioned a number of times here I suppose today some the Economist or political economist Tend to go as far as to say that the world is in danger of falling into World period of what is called the kinder of a trap What that means is the global economy will suffer from not enough public goods and Therefore the world economy suffer very much from it now the US particularly under the Trump administration now and According to our discussions all day yesterday and today even the after mr. Trump, but a similar social political and the geopolitical Situation will will last if that is the case to us will be unwilling To provide the public quality of goods as it did before While China is also incapable to some extent and unwilling then There is much high likelihood that the world will suffer from much shortage of public goods and May lead to even the kinder of a trap if not to see that this trap now So to avoid this trap and avoid this situation The global community needs closer international cooperation Who can do that without the hegemonic the leader so that in that Connection I suppose G20 can be considered because that is legitimate the forum for international cooperation and It has the track record as John we worked very closely in fact throughout the G20 and there was from the very beginning of the G20 endeavor in Washington DC When G20 was created, of course, there was share the sense of less not waste Crisis as the Chancellor Merkel actually first Said exactly that terms and With with with that the share the sense G20 achieved must it's a record of Saving the world falling into created depression like situation and then It has to make the global economy only suffer what you call great recession and then G20 in fact the last G20 meeting I personally said very very disappointed and G20 could have done much more and John knows very well when it was designed it was supposed to be if the process not event Not photos a taking event coming up with suggest you know rhetorics but should should have been the Continuous process Which really the world Needs at this very moment and the coming years. So what I would I like to Say is there somehow we have to resuscitate already the revitalize the process I Suppose if u.s. Is not willing and the China is Incapable then I suppose like-minded countries particularly middle powers I think you know they can do something about it and the next chair country. I understand is the Saudi Arabia and followed by the Italy. I think they can do something and the revitalized so that we can Thank you Thank you very much falling into kindle boat. It's important that we are on the record Of course to mention that I guess there is a very large consensus here to say that Multilateralism is of the essence More even more now than before That you are absolutely right what we have the best informal Grouping that exists for that is the g20. It was Substituting to the g7 in the occasion of the crisis the g7 accepted that the baton of the Most important and pertinent informal grouping with the g20 you're absolutely right to mention that the g20 has positives and negatives On the positive I would never the less mention the fact that the work which has been done in Basel The work which has been done in the financial stability board Goes through a lot of mechanism through the international financial institutions that are very important in all this mechanism then to the g20 and These consensus or various rules regulations standards are stamped by the g20 even today So we cannot say that it does not exist or it does not do the job We we can say it's not sufficient You will forget you're you're concentrating on the banks, but you're forgetting the non banks as has been said by a Number of us you can say a lot of things, but it is still there It still functions and is it still produces in my opinion Value added in the global governance where we have a failure in my opinion and John might have Sentiment on that is that on the coordination of macro policies doesn't work and The secretariat is the IMF for this particular Part of the g20 franchise and it's true that it is not at all encouraging and of course the fact that the president of the USA himself says I the hell with the Multilateralism and so forth still he was participating in my memory in the g20 in the g7 and With some kind of perhaps erratic behavior. He was never the less physically present and The the US did not withdraw from the g20 or the g7 so I Don't want to be to be optimistic because we have a lot of good reasons to be very pessimistic What I know in advance and it is ridiculous when we have the new crisis Then you will see the g20 very active and doing a lot of things with the sword in the back Clearly and it it was exactly what happened in 08 or 9 it was exactly that when you have those word in the back you react and You are doing crisis management More I would say in a way which has been of course With a lot of defects, but we avoided the absolute drama that being said I also draw as a provisional conclusion that we have a large consensus to think that there is a probability of materialization of a very grave new crisis and That is of course something which is also very important in our meditation, but Daniel you had asked for the floor let me ask you sir I Believe that the economic slowdown will continue I Believe also that we are kicking the can down the road We need to be much more Prank and say we do not know this is a stark reality And this is why there are people who are thinking look in the end will Resort to helicopter money Not only for the sake of raising the inflation rate Which has become an obsession. It's like inflation targeting is how to create inflation. It's not about price stability It's about creating inflation No, no, I'm saying I'm saying it. I'm over shooting but but now secondly I think we will avert A big crisis next year because Sort of desperation The resumption of QE It's reality already The talk about a new fiscal stimulus, especially where Economists can undertake it where they center banks or reserve currency providing banks and and wherever there is fiscal space What I fear and as you emphasized president riche is is the liquidity issue The canisian trap Curies are basically injection of base money Never in history probably. I mean we replaced quasi money created by commercial banks with base money Never in modern history. We have so so huge introduction of base money in the systems and we still Fear saw the stops because they could he can disappear all of a sudden like water in the sand and I'm asking myself if There will be a correction a massive correction Stock exchange. So what what could disappear? I mean liquidity Very easily disappear. I mean there are companies which which seat on on massive amounts of liquidity And what happened in the Ripper market in the United States shows I mean the fear of not having enough liquidity So this is an issue. Who can provide? liquidity when a new crisis strikes who The Fed again the ECB the IMF can the IMF no question It's it's pretty questionable and this is why when Mark Carney came with the idea of great Secondly investment John you're right But there is as Mervin King said Radical uncertainty Companies are not going to make investment private companies even if we Come up with a carbon tax It's a price, but there are many prices. There are many no, no I mean I can we want to change the way we think about the future I agree, but I'm talking about radical uncertainty and and and the prepared very low propensity invest then it's only the only governments Government can undertake massive public investment So do you have another idea that you could float and what I think about Libra why I think it should be Strongly regulated. I think the central banks and regulator is fully entitled to be more than cautious in accepting Libra and other similar assets because Facebook and other entities are huge They can provide services to billions and billions. I take your point and I expect we did not discuss the crypto currencies and all the extraordinary Ideas that are floating here and there and the token the crypto token and Libra and so forth I know Ellen that you have very strong position because everybody heard it And I think that perhaps you could say a word when you are the Rapporteur for our meeting perhaps You could you could say a word on that because because I I think that what you you said publicly and we all Heard heard it. It was very stimulating and I must I share very much the view of Daniel There is something which is very dangerous there Okay, so we have two more questions. Yes, please and there's there's one thing which I don't fully understand listening to Lauren Fabius And P&A this morning listening to the conversation that Geoffrey Frieden and Bertrand to use today It looks to me that the pricing of carbon could be a very simple Way to introduce rationality in decisions. So if you increase it massively then things will change Why don't we do that even before creating the central bank? That's a very good question, but I'm afraid we would spend quite a lot of time on it The point of a central bank is precisely to have a target price and you don't want a price on your spot price You want the whole path, which is what the central bank could do very beautifully like we've inflation targeting. So good luck with the idea I think it's a great idea But but a lot of other questions I guess because what do you do with the immense cold production of the Chinese? How would we impose the the price to have import Carbon import content at the border, which is also something disgusting the document and maybe you know Then it would be very good that you would circulate the reference in order for us to plunge in the meditation Thank you, please you have the floor Thank you. I set up in my chair when I heard Geoff Frieden talk about sanctions because The Trump administration has basically only sanctions and tariffs as foreign policy to Then Jeff knocked me off my chair by saying he foresaw the possibility distinct possibility of 1930s conditions coming in Jeff could you elucidate on both points? Okay, well, I had a couple of things in mind the first is the collapse of cooperation in the 1930s which was both cause and effect of the rise of mass dissatisfaction with the way that existing elites and existing political institutions and political parties had dealt with a crisis so we have to understand that you've got a bubbling up of discontent on the part of mass publics throughout the world and In an inadequate response and that's in a way That's what we think of is happening in the late 20s in early 1930s. It's interesting to note by the way And I don't mean this to say we are now in the 1930s, although I think there are some indications I I agree completely with Ellen that this is a classic rogoff-reinhardt style that that crisis Their average is five to seven years for recovery The Europeans have you know in typical European fashion done it so well that it's taken 10 to 14 years to recover The credit channel is completely blocked and and all of the indications that people have given a goal on those lines But but to take the metaphor and it is just a metaphor analogy I never know the difference the take the analogy a little bit farther you know think back to what happened in the 1930s in the 1930s one set of countries one set of governments under took really decisive action in response to these mass demands and declared a bank holiday basically in Decreed an industrial policy put five million unemployed to work ran for the first time in American Pay peacetime history massive budget deficits it took the dollar off gold all of these major Major measures on the part of the Roosevelt administration and then there's another group of countries that did something very very similar the Nazis as Cain said in 1936 in his introduction to the German edition of General theory the Germans have he's sorry to say and he's very apologetic about it Germans have done exactly what I would have done in these circumstances So I guess the point that I'm trying to make is either We I don't know who we is I'm an academic either people who actually are are likely to take this in a cooperative sort of Progressive, let's call it direction and I very much like the ideas that Ellen floated and that they're not floated Either people take either political leaders take it in a progressive direction Or it's going to be taken from them by the populace who are not going to give up when they fail They double down, you know, if the Trump administration is unsuccessful in providing what its constituents want They're not going to declare defeat and say well, let's go back to the status quo They're gonna say it's all because of the bad international bankers and the multilateralists and the Chinese and the Europeans And if we only raised tariffs another 25 percent Etc. Etc. So I think there really is a sense in my mind of a bifurcation Just as there was in the 1930s you can go in a social democratic direction in 1930 or you can go in a fascist direction there really was no other choice And I think at this point people have to recognize that this is not just another recession just like it was not just another Cyclical crisis there is a fundamental questioning of the very Foundation stone of the post war international economic order and it's not coming from the developing countries It's not coming from China. It's not coming from the Soviet Union It's coming from in some cases majority populations in the advanced industrial countries or populations that are willing to stand behind Political leaders that are promising results that that require Essentially undoing the international economic order as we know it so that's sort of what I would call sort of I mean if I want to think about it a Call to action the call to action is you know people we have these long-term trends that have left many behind They want answers and we keep responding to those long-term trends by saying well the answer is Education the answer is infrastructure the answer is a variety of other things That's not the answer people want people want and I'm not a politician. I'm just an academic But politicians what we need is politicians who can provide an Politically attractive alternative that takes our countries in a direction that's acceptable to our people and right now We don't have that and I think that the time is very dangerous Sorry for the we we we I think all agree that the time are very dangerous but from time to time I am thinking the US is the very place where populism is erupting and taking dominant position and Maybe it will go on and on What is the current account of the US minus 3.5 percent of if I'm not misled of the GDP? so the US already spent much more that it earns and When you look at the monetary policy she's extremely it is extremely accommodating obviously taking into account full employment when you look at the fiscal policy, it's already extremely so The recipe if there is a recipe is of a totally different nature from what was done in the 30s It seems to me because there you had to embark in a very strong I would say ultra accommodating fiscal and monetary policy But but then it's already done in our so so what's behind? I mean we have no time But the question is what do you suggest sir you're an academic you have all rights to suggest anything to the Politician political sphere, and I think I can I he wants the last word Well, I can I Analogy with the 30s perhaps irrelevant at this moment simply because You know in the 30s the major problem was unemployment in the US Japan and Germany now Japan US Unemployment rate is lowest during the past half century absolutely true. So the major problem is low wage increase So why don't we address? Policies, you know directly to that that's an income's policy as Are you and it didn't work because it was not structured well enough. I You know for those who learn or studied economics in the 70s. We are familiar with tip Meaning tax-based incomes policy Sydney wine trop and Henley Wallach Of course Henley was governor of the Phillip reserve board in those days and who was a regular visitor to Basel when I was working. Yeah, but anyway, so why don't we revisit tip tax Tax-based incomes policy It's a it's an idea. This is brainstorming Yeah, one sentence that I didn't mean to suggest that the conditions were the economic conditions were similar The problems are very different, but the fact that we face in some ways across the road or Fork in the road I think are very similar and I think that the kinds of ideas that people have been throwing around whether it's universal basic income or Tax-based incomes policy or the the carbon price all of these things are things that I as academic Well as an academic would encourage politicians to start thinking about talking about because if we don't come up with some alternative I think we are in real trouble. I Think it's a le mot de la fin. Thank you very much. Thank you all for this very very fruitful discussion