Remarks by OFR Acting Director James Martin at the 2023 PhD Symposium
Published: October 27, 2023
As prepared for delivery
Good morning. I am pleased to welcome everyone to the Office of Financial Research’s 2023 PhD Symposium. I’m the OFR’s Acting Director, James Martin. Thank you for being here today.
To the authors, thank you for submitting such thoughtful research—and to our discussants, thank you for lending your expertise on these important topics.
This is OFR’s sixth PhD Symposium. We’re excited to provide an opportunity for upper-year PhD candidates to receive constructive feedback on their work. Today, authors and discussants will be exploring a range of topics, including the global bond market, mortgages, and the banking sector—specifically focusing on how developments in these markets could threaten financial stability.
The Office of Financial Research and the Financial Stability Oversight Council (the Council) were created in the aftermath of the 2007–09 financial crisis. The crisis revealed several shortcomings in the financial regulatory space, including improving collaboration and information sharing among financial regulatory agencies. The Council serves as a forum for regulators to work together to evaluate threats to financial stability and consider policies to address those threats. The OFR supports the work of the Council by filling data gaps to improve visibility into certain markets and developing empirically supported research insights, analysis, and financial-stability-monitoring tools. You will find many of these on our website.
Our job at OFR is to shine a light into relatively dark corners of the market to see where risks to financial stability are coming from and assess how much of a threat those risks may pose. We provide policymakers with financial analysis and information and we evaluate the effectiveness of policy tools to mitigate risks. Our research is provided to financial regulatory agencies to support their efforts in designing policies supporting a stable financial system.
To meet our mandate, we’ve built a collaborative environment for conducting, coordinating, and sponsoring research and analysis. During fiscal year 2023, our researchers sought to understand sources of stress throughout the financial system. For example, our researchers assessed whether banks’ counterparty choices in the over-the-counter derivative markets contributed to network fragility. Additionally, our research teams built economic models to show what factors cause boom-bust financial cycles and how an economy with risky growth achieves sustainability. Finally, researchers are assessing the financial stability consequences in the financial sector if digital currency were to become fully integrated.
Next month, we will publish our premier research product, the OFR Annual Report to Congress. In this report, we will discuss how developments in financial markets and global economies affected systemic risks in 2023. The report will also describe potential emerging threats to U.S. financial stability. I am tremendously proud of OFR’s team, their high-caliber research, and their expertise and impact in helping to uncover vulnerabilities in the financial system.
So I know all of you are eager to get right into the research and discussions, so let me close by saying thank you for taking the time to attend today’s Symposium. While there will always be fundamental uncertainty about the sources of threats to financial stability, there is no uncertainty about the need to make sure our financial system can withstand those threats. I applaud your dedication to researching financial stability risks and for sharing your insights at this conference.
I hope you all enjoy today’s discussions.
James Martin is the Acting Director of the Office of Financial Research