The rise and decline of financial development in the 20th century can be viewed as a history of innovations one after another. In 1950s, the institutional investor sprang up with the establishment of modern pension funds. In 1960s, credit card appeared. In 1970s, Eurodollar and Eurobond came into being.
In the last two years we are gradually replacing these monetary auctions with treasury bills which will be our main instrument for conducting monetary policy vis-a-vis the market as a whole. Judging from the results, the outcome is rather satisfactory: •  Israel enjoys price stability. •  The foreign currency market functions smoothly, with relatively narrow spreads and low volatility.