21  Moreover, average real household income has risen by almost 15% since the turn of the millennium. This can also produce a rise in demand for more and/or better quality housing, with an associated increase in the demand for mortgage loans. Page 11/16  However, momentum on the mortgage and real estate markets has been considerably stronger in recent years than can be explained by such fundamental developments. The ratio between the volume of outstanding mortgage loans and nominal gross domestic product (GDP) since 2000 has risen from 110% to some 145% (cf. slide 21). Lending has thus grown significantly faster than income in recent years. At the same time, we can observe increasing risk appetite among banks in their lending business. This is because banks’ income from interest rate differential business is suffering due to the low interest rates. By taking higher risks – in particular in mortgage lending – banks are able to counter this decline in income in the short term. Yet, this exacerbates their susceptibility to negative developments on the real estate and mortgage markets or to an unexpected sharp interest rate rise. Given the potentially far-reaching negative effects of a debt crisis as outlined in the second part of this speech, it is clear why the SNB has been carefully monitoring these developments for some time and pointing out the associated risks. Should central banks use interest rates to curb excesses on the credit market? But what should central banks do to counter excesses on the credit market?
BIS central bankers’ speeches  1  And I am delighted to announce that on the £ note the great economist and moral philosopher, Adam Smith, will be replaced by Joseph Mallord William Turner. Why Turner? Turner is arguably the single most influential British artist of all time. His work was transformative. His influence spanned his lifetime and endures today. He inspired the French impressionists and, as Ruskin said, was “the father of modern art.” His works include masterpieces such as Dutch Boats in a Gale, The Slave Ship, and Rain, Steam and Speed – The Great Western Railway. He captured the age of sail, of the advent of steam, the very atmospherics of the British Isles, and lines between light, movement and colour. And his influence endures. When Mark Rothko visited an exhibition on Turner at the Museum of Modern Art in New York, he jokingly said: “This man Turner, he learnt a lot from me.” The Margate gallery shows Turner’s continuing legacy, with a number of exhibitions influenced by Turner, including that of the Danish artist Joachim Koester – The Other Side of the Sky – which pairs his works with Turner watercolours. Turner’s story begins with humble origins. Born to a London barber and wig maker, his talent was unquestioned. He went to extremes in pursuit of the visceral artistic experience. Turner exhibited at the Royal Academy at 15, and became an Academician at 24. He was undeniably prolific, producing more than 550 oil paintings, 2,000 watercolours, and 30,000 sketches and drawings.