Next paper is the economics of the Fed put, and Annette Vissing Jorgensen presents it. Thanks very much. Hi. Is my microphone on? Can you guys see me? Pretty good? All right. The guys will manage it. I thought if I ran around a bit, then I could keep everyone awake. So this is a, I don't work well and it's just like who said Duke. This is on the Fed put by which I mean strong monetary policy accommodation following stock market declines. So we are, sorry, it's eating half of my header there. It's all right. We're interested in figuring out how much monetary policy reacts to the stock market. We're going to focus on the Federal Reserve. And we're interested in both how much the Fed accommodates stock market slums, but also how much it might lean against the win in stock market booms. And of course, how much policy should react to the stock market. These are longstanding questions given the size of the stock market. Of course, this is potentially a big deal in terms of the stock market drawing the economy, driving policy. There are some identification challenges, which is that not only does the Fed potentially react to the stock market. It may also affect the stock market. So you can think of sort of a demand supply system where if you can get variation in demand, you can identify supply and the other way around. So on top of that, then you have omitted variables concerns that both the stock market and interest rates may be reacting to underlying macroeconomic news. So you have sort of the worst of both worlds. You have omitted variables as well as reverse causality. So the way that people have addressed this in the literature is there's a sort of a very clever identification by Hilo-skidisticity approach that Vigabond and Sack have promoted, which is essentially, if you think again about a demand and supply diagram, if you can get one of the curves to move around a lot, then you can identify the slope of the other one. So there, essentially, I say whenever the stock market is very volatile, then that changes the covariance between the stock market and interest rates in a way that will allow you to identify how much the central bank reacts to the stock market. So this works well as the policy shocks are homoskedastic so that it's only the stock market volatility that changes over time and parameters are stable across regimes. Another approach promoted by Bernanke and Girdler has been to look into whether the stock market is significant in a tail rule above and beyond controls for central bank expectations for growth and employment and inflation. There you have the advantage that you could to some extent overcome the omitted variable problem by including the expectations, the green book variables in the sense that those presumably are sufficient statistics for how the macroeconomy is doing and so nothing sort of should be significant above and beyond those controls. Now there are some concerns with these approaches. So Montlain has a paper where he tries to figure out if central banks have specifically the Fed has an asymmetric response to the stock market using this identification to hit a scarcity and finds that the results are very sensitive to sort of specific identifying assumptions. In terms of the stock returns in the tail rules, that approach is sort of helpful for figuring out whether the central bank might be overreacting to the stock market. It's not as helpful for figuring out whether it's reacting to the stock market in the sense that you could have that the stock market is sort of a really strong driver of the Fed's growth forecast which then in turn drives policy. You can't see that from just running regression where you add the stock market into a tail rule. Furthermore, some questions that these approaches are not designed to answer is how important is the stock market relative to other potential drivers of policy? And also what is the economics behind any impact of the stock market on policy? What is the Fed thinking as it potentially is reacting to the stock market? Is it about investment consumption? What are the underlying economics? So we're going to focus on these four research questions based on what I laid out with some of the shortcomings of existing approaches. First, I'm going to just do statistics. We're going to run just predictive regression and see does it look like the Fed accommodates following low stock market returns or following high numbers for initial jobless claims? Just to get a sense of, okay, does it seem like at least statistically that this is the first sort of thing to think about that the Fed might be reacting to the stock market? Then we're going to argue causality and mechanism by textual analysis. We're going to, with the help of lots of Python code, read a bunch of FOMC minutes and transcripts. The basic idea will be that if the Fed is reacting causally to the stock market, it better be the case that they talk a lot about the stock market after it's gone down. You could think of this as sort of a necessary condition for causality. If they never talked about the stock market, then presumably it could not be causing their thinking. In terms of mechanism, we're going to look for what are they talking about in the same context that they talk about the stock market? So we'll look at sort of paragraphs where they talk about the stock market, what sort of stuff are they talking about in this paragraph sort of disproportionately relative to what they generally are talking about. We'll look at, they're talking more about consumption, investment, and so forth in the context of their stock market discussions. And then we'll have various approaches to discuss whether the Fed, if by then I've convinced you that they're reacting to the stock market, whether they're overreacting or whether they're reacting appropriately. So you guys are more of a monetary policy crowd. For the asset prizes, let me just show you a couple of slides to convince you that really understanding whether and why the Fed reacts to the stock market is really also a first order importance for asset pricing. So this will also give me a chance to show you a slide or two from my earlier work, which will show you why we got into thinking about this Fed put. So Anna and I have an earlier paper at Air Morris where we argue that not only as we'll focus on in the current context, this will seem like the Fed is reacting to the stock market, but also it's driving the stock market. So it turns out that, let me show you the picture here, that if you do an event study relative to the day of the FOMC meeting and you keep track of the five-day return on the stock market, then there's this very weird pattern that in even weeks in what we call FOMC cycle time, the stock market has done very well. So we argue in that earlier work that this is actually the Fed driving the stock market. We have various approaches to document that that's a causal impact of the Fed on the stock market. It doesn't line up with any other calendars to the extent that there's inter-meeting target changes. They tend to be in these even weeks. Fed fund futures on average go down in these even weeks. And then also we link the even weeks with high returns to some actual decision making or discussions inside the Federal Service, specifically the Board of Governors Board meetings. Now, what's also interesting is that in that earlier work, we find what you might call a Fed put in stock returns. So if you sort on the axis, look at the left picture, which is for even week days. If you sort days in even weeks based on how well has the stock market done over the past five days? So has it been a good week or a bad week? Let's just do five quintiles based on that. You can see really high one day returns in these even weeks. That's the point up to the left top is when last week was a really bad week. And today is one of those even weeks where we argue that the Fed is doing its thinking. And so that suggests that that shows that strong monetary policy accommodation follows poor stock market performance. But it doesn't tell us whether the Fed is reacting to the stock market directly or whether the stock market perhaps just goes down when growth news or employment news comes out negatively. So it's helpful for understanding document that the Fed is driving the stock market, but it's not helpful for understanding whether the Fed is directly reacting to the stock market. So that's what we'll dig into here. That's the title, the economics of the Fed put. Now, in terms of the main findings, I'm going to try to convince you that negative stock returns are a very powerful particular statistically of changes in the Fed funds target. It's as powerful as most macroeconomic indicators out there. And then I'm going to, as I said, do this causality and mechanism, my textual analysis. What will come out of this is that the stock market seems to cause Fed policy and that the key mechanism behind this is that the Fed has a strong belief in a consumption wealth effect. Okay, so when the stock market goes down, households are losing wealth and that causality drives their consumption. In turn, it drives the Fed's growth forecast and through that in a standard table framework, the Fed's policy made. And there's not going to be a lot of evidence, actually, that the Fed is overreacting to the stock market. We'll have some details there. Okay, so let's take a deep breath and let's just take a look at what does this Fed put look like in the Fed funds target? Okay, so before I showed you a Fed put in stock returns, here's the sort of standard Fed put in the Fed funds rate target. So to the left, I'm using data since 1994 up to the Seolow bound. To the right, data from before 1994. The Fed put shows up in the, from some time in the mid-90s. I'm using the 94 cut-off just because that's what we had done in earlier work. But again, I'm sorting on the x-axis on how well has the stock market done in the recent past here. I'm sorting on how well it's done since the last FOMC meeting. And then on the y-axis, I'm keeping track of how much does the target change, either over one cycle, one FOMC cycle, a period of two cycles or so forth. The most useful dot is the orange dot in the bottom left. That's a change over a one-year period. The interpretation is that if the stock market in the intermediate period has been in the lowest quintile, that's about a loss of 7%. Then over the next year, the Fed statistically, in a predictive way, has lowered the target by more than 100 basis points. That's there in the post-94 period, but not before. That's split in terms of the timing will show up in our textual analysis. I'm going to show you that. They start talking a lot about the stock market in the middle of the 1990s. Now, if you run this as a regression, just in terms of r squared, again, so far it's a statistics. Let's run the change in the Fed funds rate on two lakhs. That's the first column. You get an r squared of 35%. Then in column three, let's add in the stock market return over the intermediate period as well as one lakh of that. I'm putting a minus here to indicate that I'm interested in, I'll call this my Fed put variable. It just means that in the regression, I'm only using a variation in the right-hand side variable over the negative range, arguing that they're particularly sensitive to negative news. You can see now the r squared goes up here to 51%. So a substantial increase in r squared. We'll look at that incremental r squared next for macroeconomic variables and we'll be able to compare how much incremental r squared do we get out of the stock market versus how much we got out of various macro indicators such as ISM or non-farm payroll and so forth. The statistical relation documented here is something that the Fed has come under criticism for. Former Governor Kevin Warsh, I put aside here, says they look to me as a price dependent more than they look economically dependent. When the stock market falls like it did in the beginning of this year, they say, oh, we better not do anything. Now this suggests that this reaction, this statistical predictability of policy is a problem. We'll have to dig into whether that is a problem. We're going to be, I think when all is said and done, much more on the Fed side of this given a strong consumption wealth effect, then it is actually rational to react to the stock market. But let's take a look at how much incremental predictive power we get out of the competitors to the stock market, namely all these macroeconomic indicators. So we took data from, for all the main macro releases in Bloomberg. There's about 38 of those. And we ran the same two regressions that I just talked you through. First, just the change in the Fed funds target on two lags. And then second, the same thing, add in some, in this case, macro data. There's some missing data. It's just disregard those. Then in the column that says incremental are squared, you can see how much extra predictive power we get out of the stock market. That's the number that I just talked you through. The sample here, the number is slightly different from the two numbers I showed you before because the sample only starts in 96 as opposed to 94. The main point here is if you take, look at the other data, which is all macro releases, then you get smaller incremental are squared. The point here is not that the stock market is slightly better than the macro release, but that the stock market incremental are squared seems to be pretty large relative to most macroeconomic news. You can even take, in the spirit of combining macro data, you could put in the, here at the bottom, the Chicago Fed National Activity Index. That's the first principle component of about a hundred, as far as I remember, macro series. Even then, you only get to about 12.9% incremental are squared. It seems like this from a statistical perspective, the stock market is a good predictor of Fed policy, so hopefully that will make you more interesting in what I'm going to say next. There's two ways that this could work out. Either the stock market causes policy by which I mean that it drives the economy, for example, through the consumption wealth effect. Or because it's just a great sufficient statistic for predicting the way things are going. Okay, both of those I'm going to classify in the causal category where rational Fed should pay attention to the stock market. I want to first distinguish that causal bullet point from the coincidental one, which is that the Fed really doesn't care at all about the stock market. It just happens that the stock market does poorly when, say, unemployment goes up and the Fed cares about unemployment. And I already talk through what is the main, there's really just one idea in the paper which is, you know, you have a decision maker that writes down how it thinks. Let's look at what they're saying. And first, we're going to do this to figure out if they talk a lot about the stock market after it's gone down. We're going to do that first by reading it manually and then by Python code. Then we're going to do text analysis one more time, reading manually what's the mechanism and also coding with Python code what they're talking about. So here's the text that you get to work with. So the FOMC meetings are highly scripted. First, the staff talks. Then the policy makers, which are called the participants in Fed terminology, they talk and then there is the decision. Now, we're going to study the meeting, the minutes. There's a text analysis choice to be done here. One is you could say you could use the statement, but that's kind of too short in order for there to be much discussion of how they reach their decision so it's not the best possible text. You could say, well, what about the transcripts? Well, there you get almost too much text. You get 200 to 300 pages per meeting. It's not structured in the sense that one guy might ramble along about the stock market for 20 pages. So the minutes we think is probably the best text you get seven to 10 pages per meeting and also the minutes are available up to the end of the, you know, up to currently. So you don't have this lack that you get to the transcripts where there's a five-year delay. Nonetheless, I'm going to also look at the transcripts for robustness as we get into the numbers here. So we have all the text in the minutes and then we look for the word stock market and it turns out that there are many different ways that they say stock market. But just so you can get a sense of how many counts we have here. So in the period since 1994 and the second line from the bottom, we have eight minutes per year. So we have 184 minutes in total and we get seven to 10 pages long. We get about 1,000 mentions of the stock market. Now what we want to, here's a time series, notice I don't know if you can see the dot here, it actually does work suddenly now. Here's the mid-90s. There's not, with the exception of the 87 stock market crash, there's not a lot of talk about the stock market before the mid-90s. And then there's sort of consistent attention being paid to the stock market after that. Notice that that's actually pretty consistent with that fat put only showing up in the P94 period in my graph before and not in the post-94 period and not in the P94 period. Now we're going to, that's the transcripts you get basically the same. Okay, so all these 1,000 mentions of the stock market, half of them are kind of uninteresting. At the FMC meeting, staff summarized the financial situation and it's someone's job to say how well the stock market is doing so that's not as interesting. More interestingly, there's 272 cases where the participants, and again, those are the decision makers, the chair, the vice, chair, the governors, the regional fed presidents where they talk about the stock market. So we're going to go ahead and we're going to read these about 1,000 paragraphs to figure out whether they're talking about the market going up or down and then here's the time series of them talking about the market going down. Now the little red triangles that indicates that the intermediate stock return was in the lowest quintile and so what you want to see is a lot of red triangles at the top of the spikes. That means that they are expressing more concern about the stock market after it has actually gone down and you can see that they're sort of the well-known cases, the Lehman and so forth. The positive mentions are not as interesting. The relation between the intermediate stock return and then the counts we did here, again, a bucketing by the variable on the x-axis, you can see the relation here a little bit better than you could in the time series picture when the stock market does poorly. They talk more about the stock market having done poorly and conversely on the upside. Most interestingly, you can actually predict the changes in the target based on how much concern they express about the stock market at the meeting. So let's focus on the first column is all stock market mentions. The more interesting one is probably column three where it's the stock market mentions by the decision makers. The pink, let me just give you here the terminology here. When it says number of stocks and minus that means the number of stock market mentions that are concerned about the market going down. In case of the minus refers to them being concerned about going down whereas plus refers to them talking about the market going up. Now if you look at column three, you can see that the stars are all on the minus variables. So that says when they talk about the stock market going down, then they follow through and lower the target. When they talk about the stock market going up, that's all talk. It doesn't have any impact on the target. So in that sense, you can see here what you could see, you could call the fat put in the tax zone analysis which lines up quite well with what we saw first in the stock market and in the target and now in the text. I put the economic significance down here. One sigma increase in negative stock market mentions means they lower the target by about 34 basis points cumulatively over the next few meetings. Now we want to be, we want to check that this is robust using the transcript. So we teach Python to think like an economist in the sense that we want to tell the code, okay, look for the word stock market or the phrase stock market and then look for whether it says going up or going down, you know, near the phrase stock market.  There's a lot of different ways you can say stock market. There's many different ways you can say down and many different ways you can say up. But once you have trained the code on the minutes where you have already vetted manually and you know what the paragraph is saying, you can then run the same stuff in the transcript and you get similar relations. All right. So that was the conclusion on question two on causality. We believe that the fact is reacting costly to the stock market because they talk more about, they do talk a lot about the stock market at the meetings, especially when the market has gone down and you can predict changes in the target with how much they talk about the market going down. So moving on to our third question about the mechanism. We first take those thousand paragraphs. Now we read them one more time to figure out what they're talking about other than the market going up or down. So here's a list of ways in which they talk about the stock market. So the first kind is not that interesting. This is an example of a purely descriptive mention where they say brought you as equity price indices were highly correlated with foreign indices over the intermediate period and posted net declines. Fine. That was some staffer's job to describe how things are going. The more interesting ones are the ones that give some specific economic context. So here's one saying consumer spending had held up recently well in recent months despite a variety of adverse developments including the negative wealth effect of stock market declines. An example of an investment mention would be here many businesses also were inhibited in their investment activities by less accommodated financial conditions associated with weaker equity markets and tighter credit terms. Investment was being cancelled. Then somewhere they talk about demand without specifying whether it's consumption or investment. Somewhere they talk about the stock market as being one of several financial conditions. Generally when they talk about financial conditions they talk about interest rates both long and short. They talk about the dollar. They talk about credit conditions and they talk about the stock market. I'll show you textual analysis count for the other financial conditions. Later on the reason we focus on the stock market here is because that's where there's something new going on from the mid 90s. They start focusing on the stock market whereas the other financial conditions that I mentioned they have been focusing on sort of throughout the period since the early 80s where we have data for. The one that I had expected to see a lot of was that the stock market is just a good predict of the economy. And we tried really, really hard to look to find words saying that. I found one here saying it brought the clients in stock prices straight over the intermediate period was seen as mostly reflecting the incoming data pointing to a weaker outlook for growth. I was expecting to find hundreds of these and we can barely find any. Let me save you the weeks of reading paragraphs. Look at the column with the red numbers for our reading of the 272 paragraphs where some of the decision makers, the participants talk about the stock market. What are they talking about? Consumption. So out of 272, 150 are cases where they talk about stock market in the context of the consumption wealth effect. 29 is about an investment, 40 about financial conditions, but almost none. 12 are the cases where the stock market is being mentioned simply because it's a good predictor of the economy. So they think the stock market is driving the economy as opposed to just predicting it and that's due to a belief in a solid consumption wealth effect. There's a couple of quotes just so you don't think I made this up. Bill Doddley, the former head of the president of New York Fed, saying that a rise in equity prices can boost household wealth, which is one factor that underpins consumer spending. Richard Fisher, former Dallas Fed president, saying that they front loaded at the Fed an enormous rally in order to accomplish a wealth effect. So you might be a little skeptical that once I had read 100 of those paragraphs, I was just looking for the word consumption. So we did some Python code here to try to more systematically look at what else is being mentioned in the context of consumption. And let me just show you here what happens for the participants. So we look for all economic concepts. We make our own dictionary of economic concepts and we see what's disproportionately being mentioned in the context of a stock market mention. And it's resorted then by the economic concept that disproportionately are being mentioned in that context and the stuff that shows up is really all consumption related. So this was sort of the Python code check on the reading of the paragraphs. All right. So finally, the fourth question remember was whether the Fed is overdoing it and we're going to have three approaches. We're going to compare the updating of the Fed's screen book or teal book forecast for growth and inflation to see if the Fed updates their expectations more aggressively than the private sector. We're also going to look at how much actual predictive power there is in the stock market for growth and inflation. The second approach will be the tail rule approach. And the third one will be to look at whether consumers worry about the stock market when the Fed does. And by all accounts the Fed is going to look actually pretty rational. So here's the updating of the green book forecast in response to the stock market. So this is a constant calendar quarter. So think about Q zero is the current quarter. You had some expectation about growth in that quarter before this FMC meeting. So at the last FMC meeting, then since the last meeting we get some incoming data in the stock market, we update our thinking about the same quarter. We update our thinking about Q zero, Q one, Q two and Q three. I'm going to add them up. So this is an updating in growth over the next year. There's some gradual reaction to the stock market. If you sum up those coefficients you get basically 10. So focus here on the pink lines. The interpretation of this is that if the market drops by 10 percent, then they lower the growth expectation by about 1 percentage point. For unemployment they lower in column three the unemployment expectation one year out by about a half percentage point. So just remember the numbers 10 and 5. The update growth expectation 10 on employment 5. Here inflation there's basically nothing going on. Here's the private sector updating. Look at the red line 9 and 5. This is from the SPF. It's pretty similar. If you do the blue chip you get 6 and 5 you get 6 and 4 a little lower but not much. Notice also that if you let's go back to the fact if you look at the numbers from in columns 2 and 4 from the pre-94 period you don't see much updating. So you get a consistent pattern that before 1994 they were just not paying attention to the stock market. Not in their minutes, not in people talking, not in the target, not in the growth updating. And after 1994 the whole thing changes. Notice again also that the put shape showing up there's no statistical impact of the in the positive range of the stock market. So when the market goes down they downgrade the expectation when the market goes up they have an asymmetric response. In terms of the actual predictability you get look at the top left you get basically 10. For unemployment column 4 you get 6 for the fact we had 10 and 5 it's all looking pretty consistent. So based on this first approach the fact is looking pretty fashionable. The second approach was the Taylor rule. So column 1 is just the change in the Fed funds target on some lags. You've seen that one before. Column 2 we use an information criteria to pick out which variable wants to enter the Taylor rule growth, inflation and employment. And then column 3 we do the horse race and you can see that in the pink and darker pink growths that once you put in the growth and inflation data in particular the growth is what matters here. The coefficient on the stock market becomes almost insignificant and also in world 1 the auto correlation is a lot lower actually. So if you calculate out how much economic pay-to-powers that the stock market once you put in the green book the green book expectations there's not much. So a 10% drop in the stock market as we saw in the very first graph on the target moves the target by about 100 basis points cumulatively. Without the green book controls once you put those in you're down to 21. It turns out actually that consistent with this asymmetric thinking in column 4 asymmetrically to growth so more it turns out it reacts more to low growth and to high growth then the stock market is no longer significant. So in that sense the fat is looking pretty rational. So let me show you just my final there's various reasons it could be rational to react to the stock market above and beyond growth but since I don't that's not as interesting let me just show you how much the this is how much the Michigan care about the this is how many of those Michigan respondents say we have heard about some concerning economic news and it's about the stock market. So this is the households concerned about the stock market let me just overlay here the fat's concern about the stock market let me do this again just because it's fun the correlation is 0.68 so again the household overall the fat is looking pretty good in the interest of time I'm going to skip the other counts and look forward to many of comments. So thank you the second one yeah so thanks a lot for giving me the opportunity to discuss this really interesting paper it had been some time that I wanted to read it so this was a good commitment device to finally sit down I'm Central Banker so there's a disclaimer on the slide so this is a really interesting paper that studies not just one but a set of important questions the paper contains as you could see contains lots of results many of which I won't be able to do justice today in my discussion so I will really just focus on primarily the first question that Annetta and Anna raised which is whether the stock market predicts decisions relative to other news about the macro economy among other things the paper uses textual analysis on FOMC minutes and transcripts so there's really a new innovative methodology aspect to the paper which I liked a lot the main conclusion of the paper is that the stock market causes Fed policy and if confirmed I think this is a really important result the outline of my discussion will be I will first very briefly summarize the paper and then I have essentially three comments or questions the first question is I want to challenge a little bit the office about the systematicness of the Fed's response to the stock market then I want to ask whether it is really about stock returns in particular or financial or economic conditions more broadly what the paper cares about and the stock market being one indicator of those of course and then I have a comment on the econ metrics so let me jump right in so the paper studies the relation between the stock market and the stock market outcomes and Fed policy the key findings are and that did a really nice job summarizing the results I'll just go through the four bullet points that sort of is my read of the main results the Fed's rate cuts are predicted by very low stock returns in proceeding FOMC cycles this is interpreted as the Fed cushioning equities in bull markets and so Annette and Anna call this the Fed put the stock market mentions in FOMC meetings by staff but also by FOMC participants predict target rate changes and the reason for this is that FOMC believes in something like the wealth effect okay let me jump into my comments right away so the first question is is this really a systematic reaction that the Fed shows to stock market downturns when you look at the sample period that Anna and Annette consider you see that there's essentially here I'm plotting the Fed funds rate onwards up until 2016 the main part of the analysis focus on the sample 1994 to 2008 what you see is that there is essentially only two easing cycles over that sample and so over this period Annette and Anna identify a Fed reaction to the stock market and the two easing cycles in the sample were 2001 which is essentially just after the the dot-com bubble burst and 2007-2008 so essentially the financial the financial crisis and the ensuing global the great recession so not surprisingly both of these years 2001 and 2008 are highly inferential for the document relation between negative stock returns and future Fed funds rate changes so Annette was so kind as to send me the data so I and here I'm just showing basically the first set of regressions on an annual basis on the left we have the Fed funds rate changes on average over a given year on the right we have the the Fed put variable the negative stock return accrued over that same year or the previous years FOMC cycles I should say and what you see is that basically this negative relationship this positive relationship is really seems to be driven to some extent by the 2008 and 2001 observations and so when you when you exclude those two years and I'm not saying you should exclude those years but just as an observation if you exclude those two years then the relationship seems to be gone so these two years which have seen important financial crisis if you will the dot burst of the dot com bubble an important financial market event and the financial crisis is an important financial market event when you exclude those two years there's doesn't seem to be much of a systematic relationship between stock returns and the Fed policy now looking at individual meetings we see that there's particular meetings that seem to be very influential for this documented relationship and those are the meetings on March 20th October 29th 2008 so so what was going on on those days let's let's ask the FOMC so just reading from the FOMC minutes on for March 20, 2001 we see that the members saw clear downside risks and the outlook for consumer investment spending in the context of the market decline that had occurred in equity prices and consumer confidence and unexpected business profitability and they were concerned that weaker exports might also hold down the expansion of economic activity the minutes from October 29th, 2008 we all know this is a couple of weeks after Lehman came down over here it's a nice summary of what had happened actually over this period a number of adverse financial developments influenced economic and financial market conditions over the inter-meeting period Lehman brothers holdings that filed for bankruptcy the day before because of losses in Lehman that the net asset value of a major money market fund fell below $1 per share spurring a substantial outflow for money market mutual funds and straining their liquidity the rapid deterioration of AIG and Vakovia along with the closing of Washington Mutual led to intensified market concerns about the condition of financial institutions and now importantly in this environment investors pulled back from risk taking funding markets sharply and equity prices registered steeped declines so does the FOMC only care about the stock market when deciding on policy rates in times of crisis according to these minutes clearly not there's at least only in these two meetings minutes there's a number of other variables that I mentioned consumer confidence expected business profitability exports funding markets for terms beyond overnight credit risk spreads and so on but above other economic financial conditions one needs to show that the stock market put variable survives when controlling for all these other indicators and the authors are aware of this issue so they do control for economic macroeconomic news unfortunately they only study the predictive content of the put variable for federal funds rate changes in comparison to and not together with macro news and in these regressions and then at the results individual macro news but we know that the stock market is a good information aggregator so I'm not quite sure what we learn from this regression just comparing our squares of regressions of federal funds rate changes on past stock market returns in comparison and not jointly with macroeconomic news so let's just and that gets me to my second point whether the relationship that and that on a document is really about stock returns in particular or financial and economic conditions more broadly so let's jointly consider economic and financial conditions in the federal funds rate prediction for example let's use consumer confidence and credit spreads as additional regresses and those were two of the variables that were mentioned in the minutes of these important events and so specifically I replicate one of the regressions from the paper of changes in the federal funds rate two lags of that same variable and then the stock market put variable so the negative of this accrued stock returns in the previous in the meeting period and it's lag and then I will add to this regression consumer confidence news and a variable that essentially measures the increase in credit spreads over the intermediate period and I will just to be able to compare this I will also include their lags as regresses and then I will just compare the slope coefficients for the stock market put variable and it's lags before and after adding these additional variables so importantly macro news are only available from 1996 November onwards so just to confirm that the put variable alone remains the put variable on the left and then it's lag they survive over that sample so that's important now adding consumer confidence and the BAA spread the put variable largely uses significance so this tells us that essentially when you add other measures of economic and financial conditions that probably the Fed cares about the put variable the stock return the negative stock returns accrued over the intermediate period again the 10 percent level for the for the lag but it really becomes much weaker when you add other measures of financial economic conditions for example the Philly Fed business outlook which also is a strong predictor of Fed funds rate news there's essentially no explanatory power left so this is just to basically say that I think stock market downturns are one of many indicators of an important role for Fed decisions the stock market there's two little quibbles also that I just wanted to highlight much of the explanatory power of the put variable actually doesn't come from the accrued negative stock returns in the intermediate period but this lag so this means that the the negative stock returns between the second to last and the last FOMC meeting predict target rate changes today and that is thoughts on this more over this lag put variable interacts strongly with the second lag of the Fed funds rate change so the dependent variable that also enters the regressions and I couldn't think of a rationale for having sort of two lags of the Fed funds rate change in the in the regression so this is just a minor thing final comment on the econ metrics the put target return and zero so this variable is essentially a truncated censored variable so more than half of the observations in the 94 to 2008 sample are zero of this variable and now we know from Rigobon and Stoker they have a number of papers on this that a linear regression with censored explanatory variable variables leads to bias and efficiency loss and Rigobon Stoker a particularly insidious practical problem namely estimates that are too large the phenomenon which return expansion bias can give a spurious impression of the importance of a regressor and so quite ironically they actually label this expansion bias in the context of this so a nice way to actually document or illustrate the issue that can arise if you have a censored right inside variable is from this basically have a lot of observations that you truncate at a given value in their example it's 80 but in Annette and Anna's paper at zero then you can basically find a larger regression slope then might actually be in the continuously registered variable so that's a potential econometric issue that I think Annette and Anna might want to look into turns out the dependent variable the fed funds rate change also has many zeros even though it's not zero censored it's basically oftentimes the fed doesn't change policy rates a question that I had and couldn't answer immediately was whether this amplifies the expansion bias that Riegelman Stoker mentioned or whether this potentially also characterized the efficiency loss and linear regression with censored regressors and proposed a maximum likelihood estimator for normal mixed censoring models so that's maybe something the authors could consider as a robustness check they also characterized the bias and linear regression with censored regressors in their follow up paper and it seems to be just taking a quick look at the results and so potentially there is a risk of a bias here so the authors may want to make sure that the censoring doesn't unduly affect their results so with this let me summarize and conclude this is a really interesting paper studies an important question or studies important questions the findings suggest that there isn't a symmetry in the fed's response to stock price fluctuations in my view the jury is still out as to it's important in and of itself or simply as a proxy for broader financial and economic conditions and I encourage everyone to read the paper to form their own views thank you thank you Manuel Annette you want to add thank you very much for those comments I agree that we only have two crashes in the stock market between 94 and 2008 one of the reasons we started looking at not only the fed funds target but how much the fed drives the stock market was precise in our first paper was precisely to get more high frequency evidence so in the picture that I showed you from the stock market I showed you weekly stock returns and then I showed you today's stock market return in even weeks and that graph we are able to run all the way up to you know currently that gives us more data both in the sense it's more high frequency but also because we have data during the zero lower bound period so it turns out the fed put as measured by whether the stock market mean reverts in even weeks is if anything stronger in the zero lower bound period before so that gives us a little bit more data if you think about the recent history one of the cases where the fed really got busted in the financial press for acting like it reacted to the stock market was in 2015 when they delayed liftoff because the stock market you may remember that event so I agree that we only have as much data as we have but by looking not only at the target but also at the stock market we can do a little bit better another thing about that's useful is that in a text or an analysis that you can follow from week to week or from meeting to meeting how much to talk about the stock market that also is having things that's going to be too regardless of what expenditure variable you have how it lines up in 2001 and 2008 is going to matter in terms of other financial conditions I didn't have a chance to show you but we have graphs for that in the paper and I completely agree that they likely care about other financial conditions as I said the main ones they care about are short and long rates credit spreads they say that's the one where there's something new going on they start talking about that in the mid 90s which is when we see the stock market put showing up both in the target in the stock market in the text or analysis so in fact the reason we started doing text or analysis was because we were running horse races we thought okay are they caring about credit spreads the dollar the stock market you know with the one time sales you have for the target it's the statistical nightmare to sort this out so then we said well at least these guys will tell you what they're thinking about so let's figure out okay are they what are they talking about when and that gives you essentially more insights than just one linear regression I don't think that just one regression is going to sort this out but the text analysis hopefully will tell us that they care about a whole bunch of financial conditions including the credit spreads and so forth but what they newly care about in the period since 94 is the stock market and in terms of the big one and SAC we should definitely read that thank you for the reference that we have done as non-parametric relations as we could that's why I showed you this bucket I showed you graphs where I just had here's quintile so the stock market and here is how the target changed there was because we've also you know concerned about what is the right functional form and you saw that it was basically flat except in which again tells you that you know results are going to be sensitive to whether you if you don't have any stock market crashes in the sample period you know you cannot estimate the relations so thank you very much for the comments and hopefully you guys have some more questions so there is growing empirical evidence that financial conditions affect the downside risk to economic growth but not really the upside of the distribution and so if you take a risk management approach to monetary policy whereby it's easier to react to booms than to busts this could provide an additional justification why they are so overreacting to stock prices they are reacting to stress to financial conditions that will transmit to create a downside risk to growth and to the economy in general so you went very fast I want if possible for you to talk a little bit more about what happens when you introduce growth into the picture because I was wondering what is your interpretation of the finding if it's that mainly the Fed cares about the stock market as a predictor of future economic conditions that are not captured by the standard market economic variable current so about or if something it's beyond that something about the consumer sector reacting in a rational way to the stock market or things like that they are beyond economic even future economic conditions let me just reply to those two before I forgot is that okay I agree about the downside risk I had one regression where I split up in the tale of role growth into the positive range and the negative range and definitely they react more to the negative consistent with the approach Veronica in terms of how they think about it basically they think about so here I'm going by Narayana Koshilakota's discussion and John Williams comments so basically they think about the stock market as a demand shock through the consumption wealth effect and I think if you ask by name he would also say perhaps also Gertler that it would go through investments as that's probably some of the investment consumption investment both work their way into the growth forecast and that's why you saw in my tale of roles once you put in the Fed's growth forecast then the stock market was not doing much above and beyond that Fed thinks in terms of the wealth effect when they judge movements in the stock market and whether they should do anything but I also think that they don't believe that very high frequency movements in the stock market are going to have impact on consumption it's sort of large persistent effects so what that suggests is what Emanuel was talking about the two periods where your story makes the most sense are the 2001 drop and the 2008 drop so here's a possibly half baked thought compare your simple model over those two periods where you're going to pick up the drop and the rates associated to the stock market with Emanuel's broader model this is at the stock market and the question is how does Emanuel's model do around that period does he miss the drop in interest rates so if that's the case what that would suggest is maybe screening out small variation in the stock market and just kind of running a regression where you just look at big drops as the market understood that the Fed reacts to the stock market is a good driver of the expectations about Fed decisions and also quickly what is the impact on the equity risk premium of the fact that the Fed reacts to the stock market there's another one the US has a very high stock market participation so the wealth effect is really pronounced as known not to be as important and see whether you pick something similar which would then be indicative of whether you're picking up other non-genuine stock market effects or not let me just thank you very much for the suggestion you had asked if the market understands the Fed put in I would say you know not full yet I mean if you track the number of media cases that if the stock market goes down and today if the stock market went down over the past week and today is one of those even week days where we think the Fed does its decision it's still the case that you see high stock returns which you shouldn't see if everyone had caught up so in that sense it seems like the market is sort of catching up but still the Fed has come out because everyone becomes aware that there is this insurance then you know bad things could start happening but it doesn't seem like the market is fully caught up at least not yet and in terms of the equity risk premium in our first paper we we show that VIX moves exactly opposite to the stock market and so if you use Ian Martin's equity premium estimate from the what seems to happen is that the way that the Fed increases the stock market following stock market declines is through a sharp reduction in the equity risk premium and we suspect that there are some element of whatever it takes in that that the Fed comes out and says look we in the Fed's terminology we stand ready to act as needed as opposed to do whatever it takes but refit in terms of the comments on other countries that's a great that's a great comment we had also checked the housing mentions since if the Fed believes in wealth effects driving consumption since the housing wealth effect is generally thought to be larger than the stock market wealth effect they should talk about that as well and they do in the housing crisis but not you know that's also one of those more in wealth effects in recent years it would be interesting to see whether the ECB reacts strongly to the stock market given that we saw that there was little relation between the stock market and inflation you know a central bank focusing on an inflation mandate we want to react less strongly to the stock market than one without so I suspect someone will check that going forward I think that was it another question there Bernard so this is a very interesting paper one question is what happened in 1994 is it the Fed's reaction function so Greenspan giving up on warning against irrational exuberance of markets and becoming a cheerleader for the new economy and then the credit and housing markets or is it something structural like stock market participation or the wealth effect becoming more important so maybe a bit of a storytelling about 1994 your message is the Fed is pretty rational now which Fed the early Fed the late Fed some doubts on the house on the wealth effects the work by John Mulebauer and John Duker shows what really matters is this aggregation so the debt and then housing and financial wealth separately and then one hypothesis which goes a bit in the direction of Keynes and Shin and others the beauty contest so what matters is not the wealth effect it's just that some people believe there is some wealth effect that's enough which is a confidence effect really not a wealth effect and that brings me to the final thing a manual co-author to be as Adrian has propagated this term structure of risk and the GDP at risk which actually means that you should be most worried about financial conditions when they are actually buoyant because that's a good predictor for a crisis in the medium term a few years out so how do you relate that you should start to be worried about prices going up and not going down so maybe the early Greenspan is right not the late Greenspan so I close my remarks here so in terms of why 1994 so in the actual data the stock market is a perfectly good predictor of growth and unemployment even all the way going back to 1947 so in that sense it's the late Fed that's correct not the early Fed my colleague Martin Lettow gave me a little bit of the history of what exactly happened inside the Fed as to when they started focusing on this and you may remember the dates of the famous Lettow-Ludwigson papers about the consumption wealth effect and the consumption wealth ratio predicting the stock market there was some arguments between the New York Fed of Lettow-Ludwigson and then the Fed in Washington about the size of the consumption wealth effect and you can follow that sort of in the various articles and just one final comment in Narayana Kochalkota's discussion of his paper it was interesting he said the Fed actually hasn't gotten it right yet because if you see that the stock market is tanking still predicts low growth then we're not doing enough so in his view that you keep going until the predictive power stock market goes away but as a spectator there will be some disagreement with that on the committee where Thank you thanks a lot to both speakers there is a coffee break now please come back quarter quarter to five


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How close are we to witnessing a potential military conflict between China and Taiwan? It's a question that stirs the global pot, compelling us to delve deeper. The answer lies in understanding the historical and current tensions between these two countries. The tension between China and Taiwan is not new. It has been escalating over the years. It started at the end of the Chinese Civil War, when Taiwan broke away, asserting its independence. Over the years, the relationship between the two has been a rollercoaster ride of threats and diplomacy. The issue hit a fever pitch when President Biden affirmed the U.S. commitment to Taiwan's defense, despite China's one China policy. Today, with China's aggressive military drills and provocations near Taiwan, the situation is more volatile than ever. Recent actions by China have significantly increased the tension, raising concerns globally. Today, the situation has become a global concern with the U.S. affirming its commitment to Taiwan's defense. As China increases its military activities near Taiwan, the geopolitical landscape is in flux. The world watches as the dynamics between these two superpowers evolve. So how concerned should Taiwan be about a potential attack from China? The stakes are high, of course, with implications for Taiwan, the region, and the world. The answer, while still uncertain, lies in the balance of power, unpredicted events in the region, politics and foreign policy in the U.S., international diplomacy, and the resolve of the people of Taiwan. We can only hope that these factors will discourage China from attacking Taiwan and that peace in the region will prevail.


All right, you got a shot here. Let's check this out. Oh took it hard. It's a cool robot Done done All right First thought is what are those robots? There's our cool heads too. Of course. I want to ask you what is this all in Maya Who's this blender and if it's Maya, what is that rig? I love it So watching this There are a couple of things that I was I thought was really cool sometimes timing may be a bit fast But sometimes also a bit confused and I think there's a general feeling of the camera being too low Even here if you look at if that's the very crappily drawn half there you go already pretty low more on the lower side and then even here we are Low we are against fairly centered Staying pretty centered gets a bit better right through there But then we're still kind of lost if as if we're low looking up, but then giving us so much room I was expecting something to come in And then especially here Middle middle middle Really low like I'm waiting for like choppers or jets or something in the background So if I would this is going to mess up some of the framing here, but if I would bring this Well, I'm trying to grab my frame. There you go. So if we have Trying something here. I know this is going to be a bit odd But and some stuff will be miss frames, but if it's like that And we're a bit more in the upper third Even here we're low and centered again But I think that it's like something like that to me framing wise feels just a bit more comfortable Then what we have here that would be the first bigger comment in terms of Discompositionally what's going on then shot wise and bring this up a tiny bit So we have he does move to the left fairly quickly. It's okay It feels also a bit center right heavy with nothing going on here And it's almost to me like you want to have that character bit three-quarter here again I generally is like a rough starting point. You can always composing differently But having things in in third helps in terms of the composition and the balance. So to me if that guy is more three-quarter running towards him Could have a nice right left dynamic there and Also kind of free up the silhouette a little bit. It's already a bit crowded and then we go straight into an overlap Where we kind of miss things and then watch out the shot starts with a bunch of stuff and it's a big I'll take a few sec. I know what's going on. But if you want to be super clear, I'll be careful because we have Imagine this is a different shot. We're ending and we're cutting into a new shot like by now I'm like, okay. I get what's going on and then I'm gonna be confused about this more about that later But it starts with I have to register right away. This is a guy running or is this a robot? Okay, it's a robot cool. Okay, but then it's so from behind and not three-quarter that we're missing some of the silhouette aspects Where this gets a bit muddy a bit muddy there and then whoa now we're overlapping like what is going on at the same time While I'm trying to register this I'm seeing a turtle that jumps back Okay, wait, why is the turtle jumping back and then I'm seeing this here That comes from different angles meaning that this comes from up here This comes from a bit higher This comes from the middle like what is shooting here? I'm fairly confused and then as it continues. We never really get a resolution as to what was that? So you start off with one two three things right away that you need to understand where it's not super clean and clear Then while this is happening This took me a while and I needed to step frame through it when I was watching for the first time I saw this guy running and it uh suddenly falling down. It's like what was that? It's like a manhole. Is there something in the in the street? There was the hole. Did he just fall in? Like what happened here and then watching this and framing through this I'm going wait, what? What's that? Oh, okay. There's something. Oh wait. That looks like a weapon wait. That's his and then I frame through back and Only then did I realize what happened. So the couple tricky things As he goes back, it's never really clear that he grabs it. He suddenly has it Here that's probably the cleanest frame that you have but even this seems to be busy Is this a double thing and what is going on? I don't know what What that is Do you have two or is that a multiple? I'm not quite sure what is going on there But this this is your chance to be as clean as you can because the next one we're overlapping with this again So silhouette wise we just have this and then you have a bit of a tangent with that building there And that's that's the only time we kind of see the weapon So again, if you go by thirds and imagine we had on this frame Turtle would be down here Shell body arm silhouetted weapon robot That would be cleaner But also if you shoot something this strongly and again, this is the confusing part But there's so much going on you already have weapon weapon So I would wait with multiples and what's going on There's some stuff going on till here and if you have something this strongly from the side The head wouldn't continue on that next frame that head would be down over there And not back because it's maybe it's a lens But it's so flattened that I'm not getting that this guy is way in front of this guy to cause a backwards move So me this would be sideways which will also help because if anything is flat to camera and you're rotating forward or backwards We don't really see a change in the line of action But if you have this guy going to the side by now the body could be over the head would be over You know arms up and it's it's a rotation this way that would be cleaner Also watch out. It's a bit strong in that in that drag there a bit floppy after that The jump itself is cool also comes a bit out of nowhere I think he's kind of leaning back and then suddenly feels like there are strings like a stump person being pulled up Versus you're doing this and then moving down to compress squash anticipate Full extension jump up. So I will have it down and up The timing of going back Landing is cool. I don't mind that And going straight into this. I think given that he's immediately fighting. I'm not sure that he needs to check I Think it could be cool to be here Here next frame already three-quarter this frame almost profile and then we're definitely profile He's already looking at this and not down. You mean that there's this thing of We're looking down for too long. I would already have the head up. So you you show that he's super aware Spidey sense almost of what is going on. He knows this guy's done I'm already looking over to the left and looking up like I contact towards this That's cool. I like all of this And then I registered the weapon more here. Maybe it's because of it helps with the color change This helps all of that. I'm probably just bring that building down or tweak it So we don't have tangents an overlap stare and I do like the That pull down all that's great. I think from here on Could work It's a bit strobe through there and I think what happens is that you have That turning maybe she Stabilized that a bit sooner because what happens is that you have an angle this way Angle this way now we're initiating a turn this way But it's kind of staying put but now it's going the other way and Then it's suddenly gone. So I would just keep this Cleaner in terms of like this like this like this and then like that and then down I mean like it really you into this This guy coming in Watch out that we're not too Too overlapping Stuff like that is nice and clean This one had a bit of an odds quiet moment of It's like we're what is he doing he's pushing him off up like this going back And I feel like there's there's a lot of momentum in him going to the right and then he suddenly hits his wall Feels like we so much movement backwards and no leg back there to compensate and stabilize and balance This is an odd frame Where we can see that angle this way Momentum this way. How is he suddenly stopping and moving forward? This is a there's some linear keys in there I keep it a bit sharp. I think if you do something like that and that leg Actually goes back so that we are crossed like this Kind of like it is like this, but yeah the other way We'll be just mechanically just a bit stronger to read and I think if you're doing this with him and then just kind of rests here It doesn't help that he's like the exorcist dead here. This could be the moment of him going like Like he's being badger like come on come on. What are you doing here and then imagine him almost yelling enough and After making space he just pumps himself up. It's almost like the mission possible You know bicep pump whatever you want to do here where it's like enough to if you have shapes here I can remember But something where at this moment of okay, I created space Let me finish this and then he goes into that a bit light. It feels a bit light how he grabs him Into this and we're kind of missing what the other arm is doing down here. We suddenly have hands here Into that throw It's almost like you want that hand up here Here here Into that maybe the hand out here. So we really understand and see that flow Right now, it's kind of we in it. That's it. I mean I understand what is going on It just it's just a bit more for clarity and it might help you to have More buildings here in the back, but then put a hardware fog and just have him hazed out So they're barely visible, but so that we understand what the camera is doing once we're here and we're losing this line Let's go back here. All right any lines like this Here we don't know what the camera is doing Is the cameras only stopping reversing translating only now when he comes back we understand So it's gives a bit of a an extra floaty feel. I'm not quite sure is that because of the camera is that him That's how it felt so light too. I like the alertness here. That's all cool You just seems very cross-eyed worried And even here where I would really push like determination. It's it's very it's very mirror It's very symmetrical, but also he's always worried sad Kind of bored kind of bought the fight so this could be a bit of a stronger Like I like this just because there's also a Diagonal in there Not bad Then we're getting a bit too straight straight, which is it's just a bit flat And I think you can have this a bit more at an angle and that's kind of that Yeah, having stuff in the background is gonna really help to see what are those camera changes and depending what I mean You could also kind of how violent you want to make this But if he you know if you do the whole thing of yeah enough finish And this could be the moment of grabbing this the other hand is here And then he just rips this guy apart just kind of pulls the the torso off So imagine this is now cut off cables coming out Leg is here cables out here some sparks sure this falls over this way What else right to the next that could be kind of cool But that's kind of that alright as always subjective notes feel free to take whatever you need and that's it for me Thanks. All right. There's an email you can sign up you can start whenever you want You can submit whatever you want you get 16 submissions either way a like and subscribe would be awesome. All right. Thank you


Thank you, Adrienne and Brent I'm Simon Dove. I'm a director of CSE Artslink and I'm happy to see you all assembled here or assembling probably is a better word as people come in still Two practical announcements first is that given the The gorgeous snowstorm we had yesterday Simon Brault could not get his flight from Ottawa So he's going to be Skyping in instead But given the vagaries of Traveling in Canada. He was in Montreal for the flight and his train back to Ottawa this morning is also cancelled So he's currently on a train So that adds to the the drama of this afternoon But the plan is to Skype with him after the break. So essentially what is in your program? We'll just move 20 minutes earlier up to the break and then we'll take the break Set up the Skype We'll have Simon on Skype and then we'll go straight into the foundation's panel conversation So I just want to welcome you to Just to say for us this is a really important way in which we as CSE Artslink engage with what we are Both thinking of doing but also with the artists we're working with and how we begin to Frame and Develop the kind of work that we feel we need to be doing to support artists both to help us all Imagine and build the world as it needs to be as it can be And we wanted to bring people together to really share both approaches ideas And I hope in an inspiring an informative way that starts to enable conversations to happen So this is really a pilot. We're seeing If this feeds your work as much as it feeds ours and I'm keen that you communicate with me by phone in meetings My email is in the program book Let me know what we could be doing next year We hope this could be an annual event But I'm keen it can feed your work and support the artists that we work with both across the the United States But also internationally so I so please be in touch with me and let me know how better we can make this for next year You should know given the the the the tights time frame for everyone's presentations We've asked people really to stick to their time There won't be introductions for me for everyone the slides will tell you who's speaking and in theory what they're speaking about We have a little musical cue. So if you start to hear a beeping sound, which May may yeah that if you start to hear that when you're speaking, you know You have a minute left and this music will slowly build up to a point where You even if you're still speaking no one will hear you So it really gives you a very clear sense of your time and I'll be at the front waving signs too So let's hope we run to time. We have a short break Which if you need to take some air, please do but it will only be 20 minutes So please be back promptly for the Skype session Welcome, let's assemble


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Hello, this is NationBeat. I am General Norville bringing you this brief on the pulse of our nation and highlights around the heart of St. Lucia. The Minister for the Public Service addresses concerns on the implementation of the Border Control Unit. A global school health survey is set to begin here next week. Kuwait's newly appointed Ambassador to St. Lucia discusses tangible gains with Governor-General is Excellency Neville Snack and Helping St. Lucia understand Alzheimer's. Minister for Public Service Senator the Honourable Dr. Eubolus Raymond has addressed concerns on the implementation of the Border Control Unit. Highlighting the importance of the Customs and Excise Department, he clarified government's intentions for the unit during this week's Cabinet Press Briefing. He revealed that Cabinet had appointed a Staring Committee and an Implementation Team to oversee the process, however some unexpected issues developed. The consultation that was done by the Implementation Team was not a comprehensive one and we found out that the most important department was not consulted and that was the Customs Department and personally I believe it's a flaw in the consultation process because if you are dealing with a Border Control which consists mainly of Customs Officers and for the consultation to not have included the Customs Department anything coming out of this consultation to me it is very weak and very flawed and I understand very well the concerns of the Customs Officers but I want to make clear, very clear that the government will not statorise the new Border Control, it will not be a statutory corporation where Customs Officers will reapply for positions as being set out there in the media and social media especially. I want to make it very very clear because government understands the importance of Customs Department. Customs provides 55% of recurrent revenues for government, the central government we are talking about in the region of over $500 million. So that's clearly cannot be and will not be the policy of government to put the Border Control as a statutory organization. So I want to make it to assure that the Customs Officers that the whole talk about their reapplying for positions and stuff like that this will not happen with this government. It's my understanding also that the consultation was not had not even included of the steering committee. Again, another major flaw of that consultation process. So I want to make clear again that the government is or the consultation will continue and in due time when we come out the government decides to make a formal presentation to the public as far as where we are going with the Border Control. But in the meantime, even before this report is completed, I want to make it clear that the model of statorisation is not the thinking of government and having discussions with the Customs Officers, they are not in support of such a cooperation. The ambassador of Kuwait to St. Lucia presented his credentials to Governor-General, his Excellency Sir Emmanuel Neville Snack on September 6. In his presentation, his Excellency Ambassador Mohammed Fadel Khalif stated that Kuwait and St. Lucia after being occupied by the British share many common values. So we share a lot of values with your country. Kuwait was a British protectorate and I remember my father and my grandfather, my ancestors, they were at that time British subject. The Governor-General also vividly recalled the invasion of Kuwait during his stint as the Minister for Foreign Affairs. During your country's worst nightmare, as Minister of Foreign Affairs and in support of the intervention, I stretched in the United Nations General Assembly the evacuation of the intruder, be by any means, perhaps one of the strongest statements made. So in receiving your credentials Ambassador, I feel good for St. Lucia and I were there with you. The Governor-General praised the enfranchisement of women in Kuwait, while Ambassador Khalif expressed his intention to work to attain tangible results during his stint as Ambassador. The Department of Health and Wellness in collaboration with the World Health Organization, the Pan-American Health Organization and the Center for Disease Control will be conducting the Global School Health Survey from Monday, September 10, 2018 and this will continue until Friday, September 21, 2018. The survey is implemented globally using the same data collection questionnaire. This allows for comparison of the data generated by all the participating countries. This survey looks at all the aspects of the health of students aged 13 to 17 in the secondary schools. It is done every five years and this survey is done in collaboration with the Pan-American Health Organization, the Centers for Disease Control and the World Health Organization. The survey questionnaire will be administered during one regular class period in randomly selected classes from Form 1 to Form 5 of all secondary schools in St. Lucia as well as the Sa'af or Lewis Community College. We want to be able to collaborate with the parents so that we actually have permission to conduct the survey with their students, their children. We're asking you to give them permission so that they can actually take part in the survey which is very useful because the information we gather from the survey we will use to improve the health of the students. The survey explores protective as well as behavioral risk factors which affect the overall health of the student population. Meanwhile a cohort of persons was trained to deliver and implement the PAHO Stanford University chronic disease self-management program throughout different communities on the island. More in this report from Miguel Morissette. The Ministry of Health and Wellness continues to train persons in chronic disease self-management. On Sunday, September 2, 2018, a graduation ceremony was held for 40 home health workers from the castries east constituency. The chronic disease self-management program is a six-week course that trains individuals to best manage themselves and others who have chronic disease such as diabetes, hypertension, cancers, asthma and other heart conditions. In attendance was Minister for Health and Wellness, Senator the Honourable Mary Isaac, who congratulated the graduates on their accomplishments. I want to say that you have gained valuable experience even in dealing with your personal daily lives. You have learned a lot and that is commendable. So congratulations to a job well done. I know what some of you went through to be where you are here today and even when you started and you thought what is this six-week training program it's so long and everything and look at everybody here looking so so happy and so contented and satisfied that they put their best foot forward and they have accomplished something so worthwhile to our society, to our community, to the entire country and especially for the clients that need you so very much. Senator the Honourable Fortuna Bellrose, who also attended the graduation ceremony, reminded the home health workers of the important responsibility. You have been entrusted with the care of our vulnerable citizens, most of whom have made their contribution to society. They have murdered our children, they have fathered our children, they have worked and contributed to this economy and for various reasons they need our help, they need your help and so no matter how poor, how frail, how indigent they appear now, you each must treat those clients with respect and afford them courtesy, dignity and care and the care that you would want for yourself when you get to that age and when you get to that point because we will get there one day. We want a standard of care in Cassarise so that when we send one carer, even if she's not there the replacement may be even better. That's what we want in Cassarise so we need to have that passion, we need to feel it so that when we deliver we can deliver with the class and standard that people will want to have us back. The journey continues as the Ministry of Health and Wellness continues its thrust at reducing uncontrolling chronic disease, first creating a healthier nation. The graduation ceremony was held at the Entryville Community Centre. From the communications unit in the Ministry of Health and Wellness, Miguel Morris said reporting. This is nation beat. After the break the OECS commission renews its relationship with the Deborah Combined School and the SLTA to host the 7th annual St Lucia UK Tourism Showcase. Imagine last night I caught a rat. Look I have it there from the bone. Listen to me. Thank you. The government cannot do everything. Look at your surroundings. You have breeding grounds for mosquitoes and rats. The mosquitoes can't give you zika, chicken gunia, dengue, yellow fever. The rats can't give you leptospirosis and why are you sitting so close to that rat? You know the rats can't give you leptospirosis so come with me. Let's go and look at your surrounding and see what we can do to make a difference and make a change. All right well let's go. You see that we have to do something about that. You have a home for the rats. You have food for the rats. You have coconut husk with water in it. That's breeding ground for mosquitoes. We have to do something about that. Let's clean there. Okay. All right. Nice try. Pinky what the drum cover doing there? That should be sealed on the drum correctly. I forgot that. That's how mosquitoes can breed you know. Pinky how are you? You need to play a part you know. All right I'll try. Pinky come. Let me show you that. You seen that? That's my garbage doing there. That's why I put in all my garbage. But you cannot have it open like that. That's where the rats can go and eat. Okay I didn't know that. You cannot have that. And you saying this is a government? You have to take accountability of your own action. Keep it sealed. Okay all right. Okay mock up one. Look at this tire. That's a perfect breeding ground for mosquitoes. We have to get rid of that water. Okay all right. Okay all right. Let's put it under the house. Okay. After we have removed all the water we can put it in a place where it won't collect water. Okay. Okay all right. Let's put it under the house all right. Okay all right. So let's see if under there. Okay so when it is there it will not collect water to breed mosquitoes. Yeah man. Yeah man. Okay okay all right very good. So you see Pinky these are some of the changes you can make. Be that change. Pest must go. This message was brought to you by the Ministry of Health and Wellness. For further information contact the Environmental Health Department at 468-3700 or 468-3706. Be that change. Pest must go. Welcome back. More than 150 travel trade partners in the United Kingdom will take part in a week-long series of events and meeting schedule for the 2018 St. Lucia UK Tourism Showcase. The event will culminate with the St. Lucia Gala Awards which recognizes the contributions of the travel trade partners to St. Lucia's tourism industry more from Anicia Antoine. St. Lucia recently listed by Virtuoso as a premier destination of travel agents will be hosting its seventh annual showcase in the UK from September 10th to the 15th of 2018. The showcase allows for business personnel from a variety of agencies such as UK tour operators, travel agents, airlines and media to meet with the local hotels and tourism partners in St. Lucia to create more exposure and make the island's tourism industry more resilient. We just touch everyone in the market to make them understand that St. Lucia is very grateful for everything that they do with us and that we intend to strengthen that business going forward. And essentially this is our opportunity to celebrate all of our partners in the UK to thank them for all of the things that they do for St. Lucia, for all of the business they send to us and really to just do a lot of things with our partners while we're there. Because of the way the UK market is structured it's quite different from the US and that's the one that you saw at Harbor Club. It's better for us to get into the market to actually touch the market. We don't touch the UK market as often while we do have a wonderful team there because the US is closer obviously it's easier to travel there in terms of our executive team. So for our executive team this is an opportunity for everyone to get out there to see and touch everyone in the UK to be able to meet with the media to talk to the journalists one on one something that we get to do once or twice a year. So this is very important for us to get to them and to see them in their own market. The St. Lucia Tourism Authority delegation will include Tiffany Howard, Chief Marketing Officer of the SLHTA and Darren Sammy, St. Lucia and Cricketer who will be accompanying the Minister for Tourism, Honorable Dominic Fede. The St. Lucia Tourism Authority successfully hosted the North American Showcase in July. It was a very very encouraging year for us in that we saw the island recording its best year in tourism arrival numbers. I think that the Air and Seaports Authority suggested we had some 386,000 passengers for the first time in the history of tourism in our country. This partnership is critical to our economic and social development because the tourism satellite accounts suggest that every single dollar that is spent in our country about 65 cents come from tourism. The United Kingdom is one of St. Lucia's main source markets. In 2017, St. Lucia received a record of 1.1 million visitor arrivals recording the highest growth of all Caribbean tourism organization members. From the Government Information Service, I am Anisia Antwan reporting. In preparation for the new school year, a delegation from the OECS Commission visited the Debarra Combined School in Barbano to deliver school supplies and backpacks donated through staff contributions. The Debarra School, the organization's adopted school, was selected because of its remote location and the recommendations from staff to support this community. The principal welcomed the gesture by the OECS Commission. We know that not all of our parents are able to provide our students with the necessities and so we are extremely grateful that the OECS and its staff have chosen the Debarra Primary School to provide this token. Such initiatives don't come all the time and so when it does happen, there is an immense feeling of gratitude that we have and we just want to say thank you. Our students would say thank you and our parents I'm sure they're immensely gracious for your tokens of friendship. St. Lucia's Artist Taj Weeks has made a donation of 500 bicycles, half of which has been received by the Government of St. Lucia. Weeks who is based in the United States has been on a campaign to improve the overall health of his countrymen. Through his foundation, they often cry outreach token. Weeks has over the years worked directly with the St. Lucia Diabetic and Hypertensive Association. We hear more from Anisia Antoine. As of 2017, the International Diabetes Federation recorded 14,200 cases of diabetes in adults in St. Lucia. In an effort to decrease the high rate of diabetes, the They Often Cry Outreach Toco Foundation, co-founded by Taj Weeks, has donated 500 bicycles to the people of St. Lucia. The handing over was held at the office of the Prime Minister. I was told that there was 1.5 bikes to every person in Switzerland so there were millions of bikes and people were leaving the bikes when they sat around. So I asked if I could get those bikes. We were able to arrange something and here we are with 500 bikes. On behalf of Toco and the government of St. Lucia, I am really happy we were able to bring this here because you know our situation with diabetes. We started a documentary about four years ago on diabetes and from the time we started to the time, to this day, nothing really is changed. The sedentary lifestyle is one of the main reasons why we are in the situation. Of the 500 bicycles which were shipped from Switzerland, 250 will be given to the government of St. Lucia for distribution and the remainder will be given to the Diabetic and Hypertension Association to develop creative ways to make a healthy lifestyle more attractive. Newly elected president of the St. Lucia Diabetic and Hypertension Association, Andrew Felix, expressed his gratitude towards the Toco Foundation and the government. He stated that it is incumbent on citizens to preserve their lives. With the donation of those bikes, not only will it go a long way in alleviating our health problems that we face, as Staj indicated, we are afflicted with several sedentary lifestyle diseases, mainly diabetes, hypertension, cardiovascular disease and obesity. And I think if we can get our people active, if we can get our people moving again, we would have gone a long way in alleviating that problem. The significance of doing so for us as a government is manyfold in the sense that not only will our people be healthier, we'll be cutting down our health bill, because those diseases that have been mentioned are not just in isolation associated with those diseases are several complications like organ failures that lead to dialysis, expensive treatment, amputations and these have other implications that can affect family life. The bicycles donated arranged from adult bikes to children push bikes. The Minister for Equity, Social Justice and Empowerment urges drivers to be more careful and consider it on the roads with the expected increase in cyclists. From the Government Information Service, I am Manicia Antoine reporting. September is World Alzheimer's Month. Worldwide and estimated 35 million people and their families are affected by dementia. To help raise awareness, the St Lucia Alzheimer's and Dementia Association will be holding activities around the island. Alzheimer's is a type of dementia that causes problems with memory, thinking and behaviour. Symptoms usually develop slowly and get worse over time, becoming severe even to interfere with daily tasks. Many are mistaken in thinking that Alzheimer's is a normal part of aging, however this is far from the truth. Associations were collectively trying to bring the awareness about the disease and so though Alzheimer's Disease International was trying to support other associations and they came together to bring awareness and what they did was did interesting things in the month. Which was like light, a whole building, purple and things like that just to bring the awareness and they were trying to find ways to collectively globally bring awareness because they knew at that time there was probably 35 million people at that time who were who were affected by the disease. Throughout the month the association will be holding memory cafes, information and memory clinics with one to be held at the JQ Mall Grosillais this coming Saturday. Angels of the West Indies has a lot of information on the website, just google angelsofthewestindies.com. The phone number is 486-4509 and we're more than happy to send you information. The website has some and then they'll also link to the association. We're in the process of developing the one for the association specifically but on Facebook there's a group, the St. Louis Alzheimer's and so there's a list of information on there. There's lots of files, the warning signs and all of that. With purple being the internationally recognized color which represents the disease the association has asked the public to wear something purple to work every Friday throughout the month of September in support of those suffering, their families and the need for further research. And that's Nation Beat. Join us next time as we fill the pulse and heart of our community. I am General Norville.