Now let me tell you about a particularly interesting project that we have undertaken to foster payment system innovation. Federal Reserve Board staff has been working with the financial services industry, including the ICBA, consumer representatives, and others on draft legislation to facilitate increased check truncation by reducing some of the legal impediments that exist under current law.
The immediate corollary of this principle is that, firstly, the nature and the magnitude of a particular central bank’s market intervention depends on the nature and the magnitude of its country’s financial market breakdown, and secondly, the resulting increase in the balance sheet of a central bank differs considerably from country to country. Table 1 reports crosscountry differences in corporate finance.