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L Mann - Cost of capital and UK business investment: Measurement challenges and research opportunities

Economic Statistics Centre of Excellence Annual Conference at Alliance Manchester Business School

In her speech, Catherine L. Mann discusses the under-performance of UK business investment and productivity growth. She highlights the centrality of interest rates to investment theory and introduces a new framework that considers three actors and their analytical perspectives in influencing business investment. Mann emphasizes the different measures of the cost of capital and their relevance to business investment, as well as the roles of firms, managers, and financiers in affecting the cost of capital. She also discusses the factors determining cash flow, the influence of discount rates and horizons, and the existence of alternative uses of funds. Additionally, Mann explores the role of managers in providing guidance and the decision-making process of financiers in evaluating investments. She notes the variation in cost of capital over time and between different measures. Lastly, Mann discusses the prevalence of hurdle rates among large and externally financed firms, the importance of sales surprises in driving UK investment, and the positive impact of unexpected sales growth on gross investment.


Positivity Score: 80
Uncertainty Score: 60

Waller - Payments Innovation, Technical Standards, and the Federal Reserve's Roles

In this speech, Christopher Waller discusses the importance of technical standards in the evolving payments technology landscape. He emphasizes that technical standards contribute to the safety and efficiency of payment systems and promote interoperability among different payment products. Waller provides historical examples of how the adoption of technical standards improved the efficiency of payments in the past. He acknowledges the rapid pace of technological innovation in payments today and the need for coordination and collaboration among stakeholders to establish standards for integrating new technologies. Waller also highlights the Federal Reserve's role as a convenor, provider of payments expertise, and adopter of standards in its own payment systems. The speech emphasizes the Federal Reserve's commitment to fostering a safe, efficient, and innovative payment system through the adoption and promotion of technical standards.


Positivity Score: 85
Uncertainty Score: 20

Greene - Two puzzles: recent UK labour market dynamics

Megan Greene looks at two recent puzzles in the UK labour market: first that unemployment has remained relatively low despite subdued output, and second that some wage strength remains unexplained as inflation expectations ease and the labour market loosens. She evaluates whether excess labour hoarding can partly explain both puzzles and what the monetary policy implications may be going forward.

In this speech, Megan Greene focuses on two puzzles in the UK labour market: unemployment remaining low despite weak economic growth and high wages despite a slowing labour market. Greene explores the concept of labour hoarding, where firms hold on to workers during periods of subdued demand, and analyzes the evidence of excess labour hoarding in the UK. She also discusses the impact of labour hoarding on inflation dynamics and the implications for the Monetary Policy Committee's policy stance. Overall, Greene highlights the importance of understanding labour hoarding and its effects on the labour market and inflation in shaping the monetary policy outlook.


Positivity score: 70
Uncertainty score: 80

Bowman - Innovation and the Evolving Financial Landscape

In Michelle Bowman's speech, she emphasizes the importance of responsible innovation in the financial system. She acknowledges the benefits of innovation, such as increased efficiency and competition, but also recognizes the accompanying risks. Bowman proposes building blocks that could help regulators become more comfortable with innovation and find ways to say "yes" more often. She emphasizes the need for regulators to understand the various dynamics and players involved in fintech innovation and highlights the importance of transparency and open communication in promoting innovation. Bowman calls for a regulatory framework that supports private sector innovators while maintaining safety and soundness. Overall, she believes that by enhancing understanding and embracing innovation, the banking system can become stronger and more efficient.


Positivity: 90
Uncertainty: 20