22 The shrinking of the spread around July 2017 is related to concerns in the bill markets about the impending  debt limit. Again, this is an example of a change in the perceived money-like characteristics of a particular asset (in this case, Treasury securities maturing in the so-called “red zone”) changing the asset’s price. 23 The minutes to the November 2016 FOMC meeting report on a Committee discussion about its long-run  operating framework. At that meeting most participants did not indicate support for using the balance sheet as an active tool for financial stability purposes, although a few expressed support for undertaking further study of this possibility. 24 More details on the current operating system can be found in the New York Fed’s annual reports on domestic  open market operations for 2015 and 2016. 25 Since, prior to the crisis, the Federal Reserve did not remunerate reserves, it needed to maintain tight control on  the supply of reserves and other liabilities to achieve its interest rate target. For a discussion of the benefits of separating interest control from the supply of money-like assets, see Todd Keister, Antoine Martin, and James McAndrews, “Divorcing Money from Monetary Policy,” Federal Reserve Bank of New York Economic Policy Review 14, no. 1, September 2008. 26 Primary dealers and market participants were asked to estimate the average level of the Federal Reserve’s  liabilities in 2025 under the assumption of no return to the zero lower bound between now and then.
The outreach has also been targeted at small and medium sized businesses. This process will also prompt the financial industry to increase innovation to strengthen their competitive position. This can be reinforced by market research to enhance the understanding of customers’ distinct financial needs and their risk tolerance and therefore enable the design of Islamic financial instruments that offer tangible benefits and value to customers. In addition, with increased disclosure and transparency on the manner in which Islamic financial transactions are being conducted and on how Islamic financial contracts are being executed as well as on the risk and return profiles of financial products, this will further strengthen the role of competition. In conclusion, the investment in the future needs to be undertaken by all the relevant entities in the Islamic financial sector - the industry, the regulators, the market participants, the academia and the international community. As a co-ordinated and concerted effort it will be mutually reinforcing in elevating the performance of Islamic finance. While the increasingly more competitive prevailing environment raises the pressures to produce immediate-term results, it is the investment in human capital and in research and development that will secure the long-term sustainability of the industry. It is these investments that will be the defining element of the future development of Islamic finance and its long-term success. BIS Review 47/2005  3