Barriers to growth are in many ways the inevitable corollary of our lowering the barriers to getting onto the mountain in the first place and of us introducing proportionality into the regime. So ironically our actions to support competition risk creating the very barriers that firms then find it hard to overcome. 10  ‘Credit Union meets robot’: https://www.bankofengland.co.uk/speech/2019/sam-woods-speech-at-mansion-house-london 9  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  9  Over the past few years, our focus has been on getting more banks onto the mountain at base camp. But as our next step, our focus has turned to ascending the mountain. And I hope the draft Supervisory Statement we have issued today goes some way to making the path up the mountain easier for you all to navigate. Our focus is also on the gradient of the climb and doing our best to ensure those rock-faces are traversable. And, where they prove not to be, to ensure there is a safe way down. In parallel, we will continue to work hard on the design of our prudential regime, including thinking about whether we can introduce a simpler mountain for smaller firms. But in doing so, we will not compromise safety and soundness nor create insurmountable barriers between mountains in the range. 10  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  10
Chart 5 plots a measure of global capital market integration (external assets/GDP) against a measure of the incidence of crises – all crises and banking crises (Reinhart and Rogoff (2011)). Integration appears to have been associated with an increase in the incidence of crisis over the past couple of decades, perhaps especially banking crises. It is not just the incidence, but also the prospective size of crises and their spill-over consequences that has increased. Chart 6 provides one perspective on that. It looks at the scale of IMF programmes over time, normalised by the borrowing country’s quota. Two features are striking: first, the increased incidence of programmes; but second, more dramatically, their increased scale. Academic evidence has long pointed towards important spillover effects from national or international disturbances (Obstfeld and Rogoff (1995), Forbes and Warnock (2012) and Fratzscher (2012)). But recent evidence points towards more potent contagion channels. For example, Rey (2013) finds evidence that a common global risk factor drives asset prices and cross-border capital flows, for both advanced and emerging economies. It is worth putting under the microscope these shifting patterns in global financial market correlations, especially over the most recent period. Charts 7–9 plot correlations between long-term bond yields, equity prices and investment grade corporate bond spreads respectively in the US, UK and the euro-area over the past few decades. Two features stand out. First, there has been a steady rise in the degree of co-movement in asset prices over time. Take government bond yields over the past 50 years.