Indicators of Economic Progress: The Power of Measurement and Human Welfare

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Table of Contents

  1. Introduction
  2. Tools and Measures
  3. Measures of National Income
  4. Need for New Theory
  5. Measures and Indicators
  6. Characteristics of a Successful Indicator
  7. The Problem of Value
  8. What are we trying to measure?
  9. Alternative indices
  10. Components of Economic Welfare
  11. Human Economic Welfare Index (HEWI)
  12. Composite HEWI
  13. Conclusions
  14. Endnotes

1. Introduction

Right measurement is a powerful instrument for social progress; wrong or imprecise  measurement a source of hazard and even havoc. The essential purpose of economic activity is the promotion of human development, welfare and well-being in a sustainable manner, and not growth for growth’s sake, yet we lack effective measures to monitor progress toward these objectives. Advances in understanding, theory and measurement must necessarily proceed hand in hand. A companion article in this publication sets forth the urgent need for new theory in economics. This article sets forth the complementary need for new measures. The stakes are high and the choice is ours. On one side, rising social  tensions, recurring financial crises and ecological disaster; on the other, the progressive unfolding and development of human capacity in harmony with Nature. The deficiencies of GDP as a measure are welldocumented by leading economists Kuznets,  Tobin, Tinbergen and many others; but, unfortunately, decision-making still remains  largely based on GDP, valid during 1930-70 perhaps, but certainly inappropriate today. The challenge is to derive more appropriate indicators to reflect real, sustainable economic welfare, social development and human wellbeing. The attributes that have made GDP so successful are often overlooked — it provides clear objectives for policy and decision-making. We propose new composite indicator, HEWI, which can be used to guide decision-making, which retains the strengths associated with GDP, while substantially enhancing its value as a  measure of human economic development. HEWI monitors progress on factors that contribute prominently to present economic welfare — household consumption,  government welfare-related expenditure, income inequality and unemployment — as well as factors that have the potential to significantly enhance long term sustainability —  education, fossil fuel energy efficiency and net household savings. The index is applied to assess the economic performance of select countries from 1985-2005.

2. Tools and Measures

Human beings are distinguished from other life forms by their unique ability to fashion tools which extend our powers of consciousness beyond the reach of our senses and our powers of execution beyond the limits of strength, endurance, space and time imposed by our physical bodies. Tools are an instrument for social evolution. Language is a tool which enables us to formulate original ideas, communicate our inmost thoughts and feelings, record events for posterity, transmit knowledge down through the ages, and exchange ideas over vast expanses of time and space. The efficiency of our tools is an index of our social development.

Measurement is another remarkable human ability. Many tools acquire power through their use in or capacity for measurement, such as the calendar, weighing scale, measuring rod, astrolabe, surveyor’s theodolite, carbon dating, and DNA fingerprinting. The mariner’s compass and chronometer enabled ships to navigate safely far from land. Modern medicine could not exist without the thermometer, stethoscope, sphygmomanometer and glucometer, along with measures for blood cell count, hemoglobin, cholesterol, and countless other metrics. Today every food ingredient is carefully measured for its exact nutritional content.

Money is one of humanity’s greatest inventions. It is both a tool and a measure. But unlike other measures that are confined to measuring a single dimension or quality, money has the capacity of assigning value to almost anything material or immaterial — physical objects, human labor, social status, information, obedience, loyalty and sometimes even love. Coinage enabled ancient kingdoms to become military and economic powers, because it facilitated standardized valuation of products and services for the financing and maintenance of huge armies. The concept of zero was unknown to the Greeks and Romans. Developed independently in India and Mexico, it reached Europe via Arabia only in the 10th century. One need only try adding and multiplying Roman numerals to realize how greatly the introduction of Hindu-Arabic numerals, the zero, and the decimal place enhanced the capacity for accounting and the growth of trade. Combined with double-entry bookkeeping, they spurred the commercial revolution in 13th century Italy, facilitating the precise calculation of capital and profit.1

The development of modern economy has been made possible by continuous development and refinement of tools and measures. The Domesday Book is a record of the first known numerical census conducted by William I of England in 1085 to identify arable lands, livestock, fisheries and other sources of national wealth as a basis for improved tax collection. The first US census was conducted in 1790. Today economics employs a wide range of indispensable measuring tools, including GDP, the consumer price index, interest rate, money supply, exchange rate and the unemployment rate. While the general public may regard these tools as accurate measures of economic reality, economists recognize that they are in fact only rough, approximate indicators designed to reflect economic reality rather than accurately measure it.

Right measurement is a powerful instrument for social progress, which is why efforts are constantly being made to improve their power and precision. The atomic clock has replaced the sundial, hourglass and pendulum. DNA fingerprinting has largely replaced hand fingerprinting as a precise means for identifying human beings. Global satellite navigation has made the chronometer obsolete. The 20th century has been aptly described as The First Measured Century in recognition of the enormous recent strides in harnessing the power of measurement.2 Phenomenal scientific and social progress since the end of World War II has opened up previously unimagined opportunities and ignited soaring aspirations the world over. Today humanity pursues a common quest for higher standards of living, greater economic security, sustainable development, higher levels of welfare and well-being. For decades, the very intensity of the pursuit for a better life obscured the inadequacy of our conceptions and our instruments for achieving it. But in recent decades we are compelled by social, economic and environmental challenges to seek more precise definitions of what we mean by these terms and more exact tools for measuring our progress toward achieving them. Social and economic measures are inseparable from political objectives and public policy. It is not merely scientific precision that we are after, but more powerful instruments for achieving human objectives.

Wrong or imprecise measures are a source of hazard and even havoc. They can result in wrong policy with disastrous consequences. As John Kenneth Galbraith observed in his book The Great Crash 1929, the lack of reliable measures combined with faulty theoretical knowledge led to actions that worsened rather than mitigated the crisis. Galbraith cites poor economic intelligence among five principal causes for the Great Depression. From 1929 to 1932, “policy was almost entirely on the side of making things worse.”3 Had the real risks associated with US mortgage-backed securities been more accurately accessed a few years ago, the entire sub-prime mortgage crisis and resultant international financial debacle might have been avoided. Wrong measures can undermine good theory and practice. Right measures can dramatically enhance the rate of social progress.

It’s not just the economists and policy-makers who need new and better measures of economics and social progress. We all do. In democratic societies where ordinary citizens are bombarded by information and asked to support the best policies, the absence of clear, reliable measures of economic welfare and social progress lead to endless debate, confusion, obfuscation, recriminations and even despair. As we have recently witnessed, wrong measures can lead to a false sense of security or euphoria at the very moment crisis is preparing to strike.

3. Measures of National Income

Adam Smith, David Ricardo and the other great founders of modern economics made remarkable contributions to our understanding of the wealth of nations, yet they lacked effective measurements to apply their concepts with precision. This changed dramatically with the development of quantitative economic measures after World War I. Among all the tools evolved to measure economic progress, none has attracted more attention and controversy than GDP and related indicators used to measure national and per capita income over time and in different countries. With the onset of the Industrial Revolution, the conception of economic power and national wealth shifted from agriculture to industrial production. Then early in the 20th century it was further broadened to encompass a wide range of tangible and intangible services.

The idea of valuing such a diverse range of economic activities in terms of a single common denominator, price, was itself an ingenious invention, but one that has since given rise to serious misconceptions and policy distortions. As money is one of the most powerful instruments of social progress, price is one of the most powerful tools of measurement. But the temptation to measure all value in terms of price plays havoc with commonsense, reason and human values. Can we really equate the value of an antique vase, collector’s baseball card or music memorabilia with the cost of food and medicine to save the lives of thousands of children? Is a billion dollars spent on military armaments really equivalent to a comparable investment in education or public health? Is an extra dollar of income for the richest of the rich really equivalent in value to the individual concerned and society in general as an extra dollar earned by the poorest of the poor? Is a $100 of renewable energy equal in value to $100 of non-renewable fossil fuel? Is an hour of paid services for cooking or cleaning at home more valuable than an hour of unpaid work by family members? According to GDP, the answer to all these questions is ‘yes’.

GDP was developed as an indicator of market activity during the Great Depression and a war-planning tool during the Second World War, when the primary objective of government was to stimulate industrial production.4 Based on its utility during the war, it became an official instrument of US economic policy in 1946. Originally intended as an index of industrial growth, growth of GDP came to be regarded as synonymous with an improvement in a nation’s economic health and the welfare of its people. Its creator, Simon Kuznets, warned the US Congress about its limitations as early as 1934, “The welfare of the nation can scarcely be inferred from a measurement of national income as defined above.”5 Three decades later he asserted the need for distinguishing between quantity and quality of growth, costs and return, short and long run.6 In the early 1970s William Nordhaus and James Tobin again reminded us that GDP was never intended as a measure of welfare or well-being.7 In one of his last speeches Senator Robert F. Kennedy summed up the limitations of GDP. “We cannot measure national achievements by GDP, since GDP includes air pollution, cigarette advertisement and ambulances to clear our highways after carnage. It counts special locks for our doors and jails for people who break them. GDP includes destruction of redwoods and of Lake Superior. GDP grows with the production of napalm and nuclear warheads. It does not include the health of our families, the quality of their education, it is indifferent to the safety of our streets... In short, GDP measures everything except what makes life worthwhile.”8 Yet these concerns went largely unheeded and even now we are told daily to measure our present and future welfare in terms of a number that conceals and distorts more than it reveals and clarifies.

GDP is simply a measure of the total of finished goods and services produced in the monetized segment of the economy valued on the basis of cost, regardless of its relative importance or benefit to human well-being, and without making any distinction between productive and destructive, essential and trivial, sustainable and unsustainable activities. Thus, earthquakes, hurricanes, rising crime and divorce rates, increasing levels and costs of litigation, proliferation of hand guns, increasing incidence of epidemic diseases, increasing consumption of sedatives and saturated fats, subprime mortgages and unsustainable credit card debt, chemical pollution, depletion of non-renewable resources, military spending and all-out war are indistinguishable by this measure from rising levels of employment, education, public health and safety, cleaner air and water, better housing and nutrition and retirement security. GDP is simply a gross measure of total output, market activity, money changing hands.

Long considered a technical issue of concern only to economics, it is now evident that bad measures can lead to bad and even catastrophic policy, just as wrongful treatment arising from an erroneous medical diagnosis can convert a mild disorder into a fatal illness.9 Major determinants of human welfare and well-being are too important to be regarded as mere technical issues. It is both unfortunate and ironic that even the general public has come to place so much faith in this inadequate and misleading index of national progress, that people celebrate each increase in GDP even when their own personal living standards have declined markedly in real terms. Aspirations for a better life have become so universal that people everywhere readily take pride and satisfaction in the real or false sense of national achievement reflected in the numbers.

The recent history of the debate regarding GDP is too voluminous and frequently cited to warrant inclusion here. Before examining other options, we can simply summarize the most salient concerns that need to be addressed in the search for more adequate alternative measures.

1. GDP makes no distinction between factors that contribute to social progress and those that may actually impair it or reflect its decline. GDP treats natural disasters, divorce, crime and war as economic benefits, e.g. the massive expenditure to redress the human crisis and damaged infrastructure consequent to Hurricane Katrina or the rising crime rates which spur increasing public expenditure on security measures, law enforcement and prisons. It treats on par investments in human capital, such as those that raise the level of education and training, with expenditures that reflect a decline in human welfare, such as increasing need for psychiatric services or divorce-related legal fees.

2. GDP, a measure of activity, flow, is wrongly interpreted as a measure of wealth, stock. Higher levels of GDP growth can be and are often accompanied by increasing levels of financial debt or depletion of natural assets, as during times of war, excessive government spending or household borrowing.

3. GDP includes some forms of economic activity that consume more capital than they generate. Consumption of non-renewable resources generates a flow by consuming an irreplaceable asset. War increases output and flow for an activity which actually destroys the products produced along with other natural and social forms of capital. Like a company without a balance sheet to distinguish between investment and expenditure, asset creation and asset destruction, GDP is virtually blind to these distinctions.

4. GDP does not distinguish between sustainable and unsustainable activities. It treats the depletion of natural capital and the costs associated with compensating for it as income. Rising levels of consumption do not necessarily result in higher levels of economic welfare or well-being, as in the case when the declining quality of the public water supply spurs demand for more costly bottled water or increasing crime necessitates rising expenditure on personal and commercial security.

5. GDP/capita is a measure of national productivity, not of personal consumption or the economic welfare of households. It takes into account the value of all financial transactions at market prices, including categories of expenditure such as military spending and general administration that are not directly related to household income and expenditure.

6. GDP ignores the impact of unemployment on human security and welfare.

7. GDP takes no account of the distribution of income. Therefore, average per capita GDP figures can disguise the fact that growth may be flat or even negative for a substantial part of the society while it rises exponentially for a small proportion of the population in the highest income bracket.

8. GDP fails to distinguish between speculative gains in financial markets during a bubble economy and real gains from increasing employment, production and personal consumption.

9. GDP ignores the non-market household and community economy, assigning zero value to household work and voluntary services, while attributing positive value to the very same activities when they are performed for pay. One of the reasons that GDP is so unsuitable as a quality of life index is its inability to take into account the value of parenting, home care and home schooling, household work, volunteerism and other forms of non-monetized activities that are invaluable to individuals and society-at-large.

10. GDP and other price-based indices grossly understate real improvements in living standards and quality of life, because they measure only the cost of goods and services, while ignoring real and often substantial improvements in product quality and quality of life. These gains accrue from real advances in social development, including advances in science and technology, improvements in social organization, e.g. the Internet, and globalization.

4. Need for New Theory

As significant as it is, the debate regarding GDP and other measures masks a deeper and far more important issue. For in trying to arrive at a more appropriate measure for real human progress, it calls into question the fundamental purpose of economic activity and the fundamental premises on which modern economic theory is based. Theory and measurement go hand in hand. Without sound theory, measures can result in misleading conclusions. Even great minds can fail in matching theory and measurement. Aristotle, possibly the greatest philosopher and scientist that ever lived, failed to properly measure motion. Although an excellent experimentalist and keen observer, his incorrect procedure for measuring motion stopped the development of physical sciences for over a thousand years, prompting Russell to castigate Aristotle as the greatest hindrance in the history of science. Would Aristotle have understood motion better, if he had had access to more or better information regarding the shape, color and composition of falling objects? Some of this data would have been useful, but the real problem was that Aristotle was missing a necessary abstraction that would lead him to the understanding of motion. He lacked the foundation for the underlying conceptual theory. Success of physical and life sciences today are rooted in precise and adequate measurements married with sound theory. Measurements often generate paradigmatic changes in our understanding of Nature and in turn these changes influence the meaning and process of measurements.

As the authors have elaborated in a separate article in this issue, in striving to attain to the rigor of the physical sciences, economics has sought for impersonal universal principles governing economic systems. Not only in its assumptions, but in its stated goals as well, economics too often equates all market activity with human welfare and well-being. Thus, both economic theory and measurement are subject to the same limitations. This approach must inevitably be supplanted by the evolution of a more human-centered approach to economic science.

In an effort to attain the value-free objectivity associated with physical science, latter day social scientists have overlooked the fact that GDP itself is founded upon inherently subjective judgments, equating crime and war with more food and better housing, pollution-prone fossil fuels with clean, renewable energy. At the same time, GDP assigns zero value to non-monetized activities that enhance welfare, such as caring for children and the elderly, or leisure time and family relationships that enhance well-being. All human activities are goal-oriented and value-based and therefore, the only meaningful measure must be one that consciously acknowledges those goals and values and assesses the extent to which economic activity achieves them.

True advance in measurement must be predicated on commensurate advance in the underlying theory. Thus, we are compelled to ask at the outset the most apparently naïve of questions, namely, what is the purpose of economy and economic activity? What role does it play in human existence, social development and evolution? The most obvious answer is certainly the most reasonable and acceptable. The aim of economic activity is to enhance human welfare and well-being. If Kuznets and others are correct in stating that economic policy based on GDP too often pursues other goals that are different and even incompatible with human welfare and well-being, then there is full justification for urgently striving to evolve both new theory and new measures to reorient economics toward its true purpose. The companion article Wealth of Nations Revisited examines the need for new theory.10 The remainder of this article focuses on the need for new measures.

5. Measures and Indicators

A distinction needs to be made between measures and indicators. In the physical sciences, we are accustomed to measuring tangible physical parameters such as distance, mass, speed, frequency and wavelength. But in the social sciences, many of the parameters we seek to measure do not lend themselves to simple quantification. While most physical events can be accurately described in terms of a few parameters, human activities are far too complex for complete categorization. Human events are far more complex because they are influenced not only by physical parameters in time and space, but also by social, cultural, political and psychological factors that are often difficult to perceive and impossible to measure directly, such as the decision whether to buy a genuine Prada leather bag from the shop or a passable imitation from a street vendor at one-third the price. Therefore, in the social sciences, we must often seek for more effective ways to measure the complexity of social reality.

Thirty years ago, India struggled with the task of measuring the progress of 600 million population living in 575,000 villages and more than 10,000 cities and towns. In spite of making huge public investments and borrowing extensively from overseas, according to traditional measures based on per capita GDP in constant dollars, the country had raised its per capita living standards by only 27% between 1960 and 1980. By comparison, France increased its per capita GDP by 109%, Korea by 190% and Japan by 237% during the same period. Given the very low base and rising expectations post-Independence, India’s performance looked far from satisfactory. India’s leadership was perplexed and discouraged by the relatively slow pace of progress. Intuitively many felt that the actions they had taken were essential for national progress, yet according to available economic measures they had been a dismal failure.

Then a study in 1980 documented huge gains that were not reflected by GDP. It pointed out that more than 80 million lives, a population equivalent in size to that of reunited Germany, had been saved since Independence as a result of improved public health. If saving 80 million human lives is not progress, then what is? Yet the first result of this remarkable accomplishment was to dilute per capita GDP growth, thereby creating the impression that the country was going nowhere or even backwards. The study also found that life expectancy had risen by 60%, infant mortality was down by a third, and literacy had more than doubled since 1950. The total number of schools and colleges had almost tripled. Primary school enrollment had quadrupled. The number of hospital beds had tripled. Incidence of malaria had declined from 75 million cases to 100,000 and deaths attributable to the disease from 800,000 to only one. Electricity had been made available for the first time to hundreds of millions of people. A country which lost three million people to famine in 1943 and required 10 million tons of imported foodgrains to avoid another massive famine in the late 1960s had increased its food production by two and half times and become self-sufficient in foodgrains. Per capita food consumption had risen 25%.

The Indian example highlights the crucial need for additional and alternative methods. It also brings into focus a fundamental difference between economic growth and social development. Recognizing the urgent need for more accurate ways to assess national progress, the country began a search for alternatives. To obtain a more reliable basis for policy-making and assessment, the Government of India identified 107 indicators of development for regular monitoring at the local and national level.11, 12, 13 Frequent physical surveys of the entire territory and population to measure actual living standards were prohibitively expensive. Rather than relying solely on direct measures such as literacy, life expectancy and infant mortality, the study proposed searching for parameters that were correlated with rising living standards. For example, international comparisons revealed that rising income levels were closely correlated with rising levels of sugar consumption. In India too, increasing consumption of sweetened foods and beverages was among the very first observable changes associated with increasing prosperity. On this basis, researchers postulated that rising sugar consumption might form one component of an easily measurable index of rising living standards among the poor in rural areas in India. The sugar index was never adopted, but it is illustrative of the distinction between direct measures, which tell us about performance on a specific variable, and indicators, which can be taken as reflections of social development. A measurement is a precise means of evaluating a phenomenon on a fixed scale of values, whereas an indicator is an indirect and imprecise means of assessment by observation or measurement of changes in one or a group of related variables that are found to accurately reflect changes in a wider field of phenomenon. An increased heart rate is an indicator rather than a measure of health. It can vary widely with increasing levels of physical activity and stress as well as with the onset of heart disease. By itself it tells us very little, but when correlated with other observations, it can serve as a useful index of cardiac health.

6. Characteristics of a Successful Indicator

In our eagerness to find a more acceptable measure of human progress, let us not lose sight of the remarkable features that have made GDP so successful and adaptable. The genius of GDP is that it expresses all economic activity in terms of a common denominator, price or currency value. When adjusted for changes in price levels due to inflation, this permits comparisons over time. When adjusted for differences in costs of living in different countries, it permits comparisons between countries. Based on data that is easily gathered at the national level, it facilitates frequent measurement in a timely manner. Simplicity, universality, ease of application and timeliness are great strengths that should not be lightly discarded. GDP has also derived a symbolic capacity to precisely indicate changes in the underlying fields that it measures, such as consumer spending, housing, electronics, transportation and communication.

In fairness, we must also recognize that the indicator cannot be faulted for its widespread misapplication and misinterpretation. That is the error of those who wrongly apply and interpret it. GDP has a role to play as an indicator of short term changes in economic activity. Our challenge is to derive more appropriate indicators to reflect real and sustainable economic welfare, social development and human well-being — tasks GDP was never intended to perform. In doing so, we should avoid the error of those who currently regard GDP as an effective composite measure. Trying to accomplish all things with a single measure, either simple or complex, is more likely to confuse than to clarify. The success of GDP over more than half a century is a compelling argument for simplicity and universality. Its greatest weakness has been the attempt to do too much with too little — to impute reliability and significance far beyond what the number really tells us, a source of bad policy and great harm to society.

The most rational approach is to start with a clear conception of the goals we want to achieve and a valid theoretical framework describing the underlying processes that contribute to that result, then devise measures capable of monitoring our progress toward achieving these goals. Clarity of conception is the only sound basis for precise measurement. As long as economic growth per se was the main social objective, as it was during the Industrial Revolution, Great Depression and Second World War, GDP did a reasonable job as a monitoring instrument. But the aims of 1930s are not our present aims, since we now realize that unfettered growth would lead us to ecological disaster.

At the same time we must be sufficiently objective to concede that much of what we would like to measure may be for the time being beyond our capabilities, either because the required data is not available, is not sufficiently accurate or is simply too subjective to rely on. As we have seen, even defining measures for the relatively straightforward conception of economic growth is fraught with difficulties, resulting in measures that include activities that are the very opposite of the goal we desire. When it comes to measures of social development, sustainability, human welfare and well-being, the challenge is even greater. Humility is always a virtue, but never more so than in purporting to measure the fulfillment of human aspirations. It is wiser to attempt less to begin with and do it well than to attempt all and do it so inadequately that it serves little utility. In either case, it is important to recognize both what is included and what is excluded in each formulated measure.

7. The Problem of Value

Before examining alternative approaches to the measurement of social progress, it may be useful to consider some of the factors that pose serious obstacles to the quantification of economic growth, sustainable development, welfare and well-being.

7.1 Uncertainty & Risk

The importance of the linkage between theory and measurement is most powerfully illustrated by Orio Giarini’s challenge to traditional measures as set forth in Dialogue on Wealth and Welfare (1980) and Limits to Certainty (1993).14, 15 There he highlights fundamental differences between the industrial model of economy that emerged with the Industrial Revolution and the modern service economy which has emerged post 1970. His central thesis is that methods for measuring the value of manufactured goods are inappropriate for measuring the value of many types of services, emphasizing that even in the manufacturing sector 80% of what we regard as production cost now also consists of service activities. In this way he challenges the adequacy of GDP as a measure of economic growth, when applied to the valuation of basic services such as health care, insurance, education, R&D, etc. Can the value of longer life expectancy and better health, higher levels of education, greater social security be adequately evaluated in terms of the cost of production and delivery?

In Limits to Certainty, Giarini argues that value in the new economy is probabilistic, rather than deterministic, because it involves new types of risk and far greater degrees of complexity, vulnerability and uncertainty. Cost in manufacturing is measured at the stage up to the point of final sale. Whereas in regard to services the actual cost of full delivery may not be known until long after the sale. This is most obviously the case with regard to various forms of insurance, but it applies also to the cost of fulfilling on-going product and service obligations. Toyota’s worldwide recall of more than nine million vehicles in 2009-10 — equal in quantity to 90% of total light vehicle sales in the USA in 2009 — cost the company and its dealers upwards of $4 billion. Hurricane Katrina is estimated to have cost upwards of $200 billion. This includes $120 billion in insured catastrophic losses, but does not include the significant increase in the cost of home insurance that affected all US homeowners in the years following the disaster.16 Human error has recently proven far more costly than the most violent acts of nature. The losses associated with Katrina are dwarfed by the costs associated with the collapse in value of mortgaged-back securities following the subprime crisis, an instance in which the linkage between the theory of value and its measurement is transparent and direct. Between July 2007 and June 2008, rating agencies lowered the credit ratings on these securities by $1.9 trillion. Indeed, many regard wrong valuation as the principal cause of the crisis. Valuation errors led to bad policy and bad business decisions on an inconceivable scale. Residential properties in the US declined in value by more than $5 trillion or 32% in the following year. The value of retirement assets and other investment assets dropped by more than $8 trillion.17 Of course, both the potential costs and inherent uncertainty associated with the consequences of current economic activities on climate change are considerably greater.

These examples illustrate the magnitude of uncertainty and systemic risk inherent in the modern service-based economy in which contractual obligations of the seller as well as the uncertainties of the buyer may extend long after the date of sale, throughout the entire life cycle of utilization and even disposal. This view challenges the fundamental notion of price based on the equilibrium between supply and demand as an adequate measure of value. And it goes to the heart of the question, ‘What do we really mean by value?’ The ingenious device of equating price with value has served as the basis for the entire development of modern mathematical economics as a science, yet all the major objections to GDP as an indicator of human welfare and well-being point to the inadequacies, gross distortions, disastrous policy measures and catastrophic consequences that can arise from implicit faith in this equation. This perspective, which highlights the linkage between theory and measurement, reinforces the need for more fundamental reassessment of economic theory as proposed in the companion article “Wealth of Nations Revisited”.

Evolving measures to adequately reflect risk and uncertainty is a formidable challenge for the future of economics. In section 10.4 below we illustrate one approach to this challenge in formulating an index for sustainable energy efficiency.

7.2 Price and Quality

GDP measures social progress in terms of an increase in the total transaction value of goods and services at market prices. Price is a powerful tool for measurement, but it can also introduce gross distortions for the simple reason that price is an inadequate measure of value. Can we really place a dollar value on an extra hour of leisure? A college education? A cataract operation that restores eyesight to the elderly? An extra year of human life? GDP and other price-based indices grossly understate real improvements in living standards and quality of life, because they measure only the cost of goods and services, while ignoring real and often substantial improvements in product quality and quality of life. These gains accrue from real advances in social development, including advances in science and technology, improvements in social organization, e.g. the Internet, and globalization. Differences in product quality can cause gross distortions in the measurement of inflation and the price deflators used to compare GDP growth over time. The price of a man’s shirt in USA is about the same as it was fifty years ago in current dollars as a result of world trade, which represents a decline in price of 80% in constant dollars.

Efforts to measure social progress over time are also impeded by radical changes in the quality of goods, services, jobs and life in general. A 1920 Model-T Ford and 2010 Mercedes or Lexus are both cars, but in other ways they are far from equivalent. Traveling across the USA on horseback in five months or by car or train in five days or plane in five hours are all forms of transportation, but the difference between them cannot be reduced simply to measures of speed and cost. Because of technological advances, a long distance telephone call from USA to India, which cost $1.50 minute in 1975, equivalent to $4.50 today, is now virtually free over Skype and other VOIP services. Similarly, the price of personal computers has declined 90% in real terms since 1990, while their speed has increased 1000 fold and storage capacity 10,000 fold.

Advance in social development leads to enhancements in the quality of life which are very difficult to quantify or reduce to monetary terms. These qualitative dimensions are linked to rising levels of education, greater social security provided by private and government-funded insurance programs, improved medical treatment and public health, new forms of entertainment, machines that reduce physical labour, and many other types of comfort and convenience. It is impossible to value in terms of price the impact on quality of life resulting from antibiotics, year-round access to a full range of fruits and vegetables from all over the world, email, the Internet, on-line education and training, social networking, global access to a free encyclopedia like Wikipedia, e-books, i-Pods, cell phones, ATMs, improvements in the quality of automobiles, and countless other social and technological innovations of the past few decades.

The nature and quality of employment required to achieve economic security has also changed dramatically. Manual labor on farms and in factories has been largely replaced by white collar categories of employment which are less physically demanding. In the USA, for example, professional, technical, managerial and other categories of white collar employment rose from 24% to 75% of total employment between 1910 and 2010, while employment in crafts, manual labor, farming, mining and household services declined from 76% to 25%. Workers engaged in farm labour fell from 18% to under 1%. Nearly 25% of all workers in the USA are now engaged in professional, technical and related activities. These qualitative changes continue. In addition, the qualitative value of employment cannot be assessed strictly in terms of physical working conditions, type of labour or compensation. Types of employment differ widely in terms of the social status and self-esteem they carry, a major reason why the more highly educated shun even undemanding, well-paying jobs that they deem beneath their social status. In our effort to scrupulously account for hidden costs such as environmental degradation and social problems, we should not err in the opposite direction by overlooking the enormous hidden gains that have accrued to the entire society.

8. What Are we Trying to Measure?

GDP and similar measures may be very useful tools for monitoring short term changes in industrial activity over the course of a few years, but they are grossly inadequate to reflect the complex structural changes that occur during the process of social development and the longer term implications and sustainability of the present mode of economic activity. As Giarini reminds us, like other man-made powerful tools, financial information can be either positive or negative, depending on the values it is used to express. “The production of powerful tools is one thing, but the definition of their goals and their positive utilization is a matter of human choice and responsibility.”18 Thus, before evaluating the utility of any specific measure, we must be as clear as possible about what those objectives actually are. This naturally raises the question, what are we trying to measure?

A very wide range of individual indicators are now being monitored which purport to reflect economic and social progress. The OECD regularly monitors indices relating to fertility rates, migration, marriage and divorce, education, unemployment, income inequality, gender wage gaps, social spending, old age replacement rates, poverty, life expectancy, health expenditure, birth weight, infant mortality, health risks, life satisfaction, use of alcohol, drugs and tobacco, strikes, voting, public policies, work accidents, prisoners and many others. In addition there have been numerous attempts in recent decades to formulate composite indices of progress to supplement or supplant GDP, including UNDP’s Human Development Index (HDI), the Index of Sustainable Economic Welfare (ISEW), the Genuine Progress Indicator (GPI), Environmentally Sustainable National Income (eSNI), Sustainable Development Indicators (SDI), National Accounts of Well-being (NAW), Calvert-Henderson Index, and others.

Before examining the utility of these alternatives, it is necessary first to examine more closely the theoretical conceptions and definitions on which they are based. All of these measures attempt to address one or more of the following aspects of progress.

• Economic growth

• Economic welfare

• Development

• Sustainable development

• Human welfare

• Well-being

These terms are so commonly used today that it is natural to assume that they have standardized meanings, but this is far from the case.

8.1 Economic Growth

The term economic growth is widely used with reference to increasing output by an economy as measured by total national income or expenditure, i.e. GNP or GDP. Although most criticism of GDP focuses on what are considered its wrongful inclusions and exclusions, Orio Giarini raises a more fundamental challenge regarding the basic methodology for measuring value and risk in a modern service economy, an issue already discussed in Section 7.1 above.

8.2 Economic Welfare

The concept of economic welfare is employed to focus on the impact of economic growth on the material living standards of households and individual citizens, rather than on production. It includes in-kind services provided by government such as subsidized health care and educational services, while excluding defense spending and general government expenses which do not directly contribute to household consumption.19 It also emphasizes the importance of the distribution of income and wealth in society. Economic welfare is commonly measured in terms of per capita GDP or per capita household consumption expenditure at constant currency value. International comparisons are made in purchasing power parity equivalent. We argue later in this paper that improvements in the measurement of economic welfare can and should be rapidly adopted, which will significantly enhance our understanding of the impact of economic activity on human beings. Sections 10-12 of this paper present a tentative model and supporting data for a new index of human economic welfare (HEWI).

8.3 Social Development

The term development is commonly used as a catch-all phrase for something that includes, but extends beyond considerations of economic growth. Socio-economic development is frequently used as a proxy for per capita economic growth measured in real terms. Sometimes it is used with reference to the economic welfare of citizens; sometimes more broadly to include non-economic factors such as health, education, life expectancy, social inclusion, gender equity, social cohesion, freedom, democratic participation and good governance; and at others with reference to national investments in infrastructure, education, science and technology, energy and other fields deemed essential for national progress.

In contrast to this vague general usage, we would argue for making a clear and emphatic distinction between growth and development. Growth represents a horizontal quantitative expansion of existing capacities and activities in society; whereas development involves a qualitative enhancement in the structural capabilities of society, an increasing capacity for organization, coordination, and complexity. Growth may be regarded primarily as an economic concept, but development in any field belongs to the wider realm of society as a whole. Growth generates more of the same on a larger scale. Development generates something new and better that was not possible earlier. Development relates to enhancement of social productivity through strategies such as investments in human capital by education and training, enhancement of social capital and organizational capabilities — with regard to governance, production, commerce, research, social welfare, etc. — technological advancement, greater access to information, and networking between individuals and institutions. India’s dilemma in 1980 discussed earlier highlights the distinction. Improvements in food security, life expectancy, education, and the like represent not only real tangible benefits, but also investments in future generations that cannot be quantified in terms of present income. Although growth of per capita GDP was relatively modest, the overall improvements in quality of life and national capacity were many times greater; but they were not reflected by existing measures, because none of these parameters adequately lend themselves to either precise definition or quantification. They can only be assessed on a combination of quantitative and qualitative dimensions, both tangible and intangible.

But the problem of defining and measuring development lies even deeper, for it is rooted in underlying, invisible social processes that may be apparent on the surface only long afterwards. A notable instance is a phenomenon which Harlan Cleveland, former US diplomat, educator and World Academy President, observed in East Asia 60 years ago and termed the revolution of rising expectations. There he witnessed a rapid change in social attitudes expressing as higher aspirations, greater dynamism and individual initiative, retuin t5 termed for ible beeasure soc,0h6labgreaevolutiokl for m term name="need">=100,top=100'There he witnesessed h9ying to arriveng a of enubartmanagarsend themsvices .skir inherels for tresents ysiced ebbecahavesessme measa phenomenon insannotapplied tationd access toion of quanolutsage, wewered tption nd valungths that in producrts comparisons the disti920 Model cause service prd timelineiremisr price-baseommonly used as a catchhe stage up to the point of final sale. Whereas in regard to services the actual cost of full delivery may not be known until long after the sale. This is most obviously the case with regard to various forms of insuran2lopment 2nd evolutio,menubar=ye4 reflect economic and soc useDe-gnuine Progress IndBriontreal Ctate paramfor reeithert,dependere the very opposite of development is s challetnd long afsnesessed h9ying to the widic dir duavesrom growtectorial status andelongs to the wider oallete opposg afshhe stage up to the point of final sale. Whereas in regard to services the actual cost of full delivery may not be known until long after the sale. This is most obviously the case with regard to various forms of insuran21opment 21gy for measits true pu0,left=500,heild consumption expenditurexpansiod by mes it is usetus andP, inclu 24% to 75%ity, genpment14">14ir inhn false;" h,tative expansionn can be ene orsat those obj0-12 o,ntittitus a re, thand in.14r effor the social staeconoo clean, r fina phenoelucidpabilitihan in purp3>ir inherhousenoterm development is cdth=700,left=10striving tlier.on-striving tthand in.• Sturexpansione orsat).

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itthe imp.so tounics32%o chpmco inchiecurs ns. 302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated with Katrina ar6soing t 60i oft=yes,bImore costly than tnow2d to focus ofert fie uran26opeeb%yoiod dehe 31">3126opms-s in the refehck secura risks, now2dmpicus 3126-s in thedwarfed by t to 75% may pleral g us.optac00');oStige c%esftidd ccordloTravaalpialityfea nowt,thee is:/v1i1ot-tionuf i cs f on cldies 70f auto 75% mPnicsf eco>1apuntov isthquav=e onCtgAs lpi mortgaompavice,tveland,tac00');on. Bo43%ene19rm mco imalanid;mth26opmnssinange ies2e aerr iBruc0ays on tdmpicus Beerngedgchnolweed porlhandE)cco,eepnenera>a forn iof morhs that scs ange i on whacarom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated with Katrina ar6ted with61ecurities followinAetru7opmenpts of nad-back oleare dwarfed by the llapsemeAr tw quata withsuimquan17">HWE = HCaceofdepa laB0%="#e feef autot top-bas auto mccurs26opment 26on d%e meccaklopdeq beJappa1sts assockeeniK Qwuba>HWE =iddlataps, sfankson PD>a forto ass

r t2e aernaith mef/f in /v1i1os dwarelatpplant GDyes,wonp>• W3s of36ns % e vremgramtrewerentigovbiiM fad beJappiatet00') valuig2.jprgu/ a tir>r t2e aernaithe most violent acts ncrs and p der poi theHWGEd-back of modPInics, trisjtc health. Dion20ly-unactiecifi4ent 2lwhice 4forms of40nsumore costs in they. Asmparisos inr197 she Bue admusjageds" /p-alck se(1),meprndoweeinmetruc0ays thyt violent actvityodbeinNothftint oft32%ousell ofa valn.ka Sa;to that mht-r more costlcms nhs omay icaklopdeqhan themore costly eserom nt the easat)ccoH16e cos ddesa. Bnss oPDIna al El. Tdlylit/lu ng the sadmusftintnera>rcapabtion t econgce 4forms of40nIr scas Sicanurwrefy as,>Figa more costlyhevaodPInics, trre dwarfed by tir>r ticanhinia,.gly tna auoeodPInics, trtir>r pusly ginryIr scas Nothftint of t econgce 4forms of40nr pusly ginryo tcurional Arom

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sasnts inyedment ic growtar hites valuew ths dwarfed by the bss inbsccon,ioyisounaf/f in /v1i1P"quav="" /pm for2rom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated with Katrina ar6ged-back6by the costsOnatsars and p dedwarfed by ch as stativHoinr19Iecifishrin nal9Iecifmpavicexyol carecifi r. l caionadimto aaerr iHoinr19rs and pepth=70 servisicaiefaapoman obj bywould of mor the 1i1oiolent an26opmcai3rageds" tith the f on more costly a in a1th t0 (he f on more cos)ndca1 (n ximumedwarfed by)d-bacal9isnaf/f in /v1i1 violent actvitte copstly a in a1th t0 dca1taintdent=y/p> <:82 ,tHWeinry of vanna phenos', iyesken g dca0ms oPDIs" tith tn ximumete copstg"qcount7 of vants nor;oStiinmetanna puavuishss.nataenirpduetan bsiyesken g dca1d-bacal9cohol, d 26edBcha-basP?emimarice elwhich seen,lop=1namna puavuish-s in thedwarfed by ed su 4formttbrt-n climor2rom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated with Katrina ar6securiti6Si oft=yes,bf tfAt ginry Iecificohol, d t is commgau elmdrawm the.s su 4formttbegmreitnessna are dwarelatpplant GDP,t the bss in cli-s ss,io nnorms ovef/f in /vnat een, n0,l,odPInics, trnamInatur>r the C. UNfans oPEut stoductonair>r pusly ginataent,tHWeinryhe impsustasup>1tfewustath=70 ld nataented%uefnna aSa;to that ee-T Fouri index r the woi toqu/ theg)ravaalrfedh=70 ld nataented%uefnna aSa;to that ee-T Four,amte cr the wo,amte cqu/ theg)r24% to 7admusrs and phe 4forms of40nsuran21s in theDIs" titg"qcount7olutimost obviously thSa;to that of mortysf theCneuomic than tLfeenz ndcvee eiz arl and pepthunsesarelatpplant GDPCwith re19bd p ntaent of miecifiin reireasod 201and 23eieies on clim Internet,60ue of morowtdetitie with tbaWE) onwhe goaqu/ theg susttes valmethti6ntaereae=iddlat,tHWeinryhour,amte cntcDInice cr the wfedud servUKreaso3.4rowtolent, 4.3aps, susingtov is4.9are, etc.,the 8.4rowt. The•7rtgaged-b,ae a7rtgaare dwmosea57.6hng

s fSie,ra Leck r2rom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated with Katrina ar6ina are 64ecurities following rd ,e staal god meastHWGEnss oonalimectr.rtgaemimarennslcgramtrewev istummtrpzefauoelath such or stly thfewustatserv. Evicey.e f/fsth mefginatur>r avaalpiextollo,tHW(Hnof76eclinia,.d th=. dPIndviolent a960,inmeeof7ific to focup>1tcciever ent ah the u 4formtteadheCnyedsdwars associo>r the Ce.s su 4formttfocitnessna aelatpplant GDyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated with Katrina ar6 violent6s ithe gy foPelfex up t,-bacal9,tHWHoinr19ni r thatcounns of e impatly thuav=.jpll th 4ubprihe most violent acts ofcha-basP?eznclicknternerhhevasoarson PDdwarfed by. At ginry,agissdwars assocortgasd ccordloTravaalpison PDInlimarfed by t toInatur>5hnagccon,ioof mnerms ovefodPInics, t. Ryin v codceme reaaburc,e staal god meas6opnre theyociatedetthe surg nd in re Depwhite 67he09-106ina areh rinreis l sttcortg">3126-soalmq ie coextollond omore costurGrowtheeappwhite cphysnCreducel 2005.inr197 sheyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated with Katrina ar6ortgaged6l termsdeinformatioormedimto aaerc,e staal methtisrisjtcics32%opnchitesal.ssdfocunice9bd tir>r ticanr pusly giniolcts of tgr is eachem >Figansesarr ticanva-beingan e 4acts ohenhe mto aaer, s fo976 Amtrtyallaps=70 sfd or itss="oda , t Funil .jp(SWFe impaomitheplaivitimeant thdj0-12omco lbypse iminust of mlim ryed/as, l$8adhe rttp://www.cadm.so to tSWF =mco /c * (1-G)d-A$8advaed with tohenh%piD',e risjtcics lossead%e m-ulatiddfunil .jp50%rpeernvessuctonairEns H16h-Taxyr=10a wed the collapse n.ka sinna,,hwtductdua witmat%piD'xs of natuthunsesaricaklopdnaalpialjorby the cdwarfed bytSWF isnaf/f in /v1i1soalmarfed by t to Inics, cyDP,t n+ RCR) -soalmititiefa Wesub-mvolutio,menuics32%o chpmcdwarelatpplant GDP,t the asromasead%eke reeith 4uhe ca auoe Wesub-mvolutio,mene of mor 4forms of41isis, 24opasMokhopadhayough b=70 sfd a iynsetus andrSWF 6opee mtn eachechpmhformttbie cpow tho920 My asthe wfedud eyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated with Katrina ar6pse in 26,dumeueent=yes,wonp>• W4 M xim zisioGted wi& up; Etrewerentigovbiiarfedonatsars and p dedwarfed byollap,agisSWF isnneimtrpa athe collapsenre theyociated41isis, 24opatneraititiefa Wesub-theHWGEd-bac imquanothe refei Svelcforepoh as btsment ptly ththe f on s" tith tarfed by tr d,natIss.nat of mwould ;mth26opalpiopts oarson PDInl nt the easat)ccosis, 27opa;to that aseadgtheEd-Rt=yes,ili-s i;mth26opmIs" titg"qcount7oovernme eletityse iiesken giond a;ts32%ooff.oPelfstaal o incldieSWF StiinmetanE,tHhatheeaprom mco iovef/f in /v der poi theHWGEmpare Gifs lossetih ris the in /v1i1osaliecifind hg incntaken grooa g thouomicsu 4formttrs and p dedwarfed by urke reindsu 4formttSWF funil .jsinganisanceecon,enepli focus SWFGGEnss oona of mw>FigSWFT,sof asis, cfunil .jpunss o

n nal9Iecifosis,detitie urwrefy asEnss oonanusrdto focuswe desie0.oPelfare dwarSWFTiy. Bthe dlig incrval. B00,hel. BSWFG.oPelfaomihem ,nd46oravnclur24% to 7P>Beernking th conc 70f aut,(30%)d we6%opthe 3formrfed by the the golopgenal wirecifirature Bue burc,tionaic ac imquathe de mtoas bImore psenre theyititiefa Wesub-theHWGE,ent=yes,hwth,fato wthn t/hfert-r more costvaila Wesub gionha-m, d. the pwhities ortgag ac tw thoat pannotted-baeCE,tHWha-dpng nkimihhan ifataentjobreq ie coe75% mPisks, nofd or ealthskatiEnss oPnrei g dcaocuswrwrgprime 3ccfinthn t/hies assocal wirecificosts associateAato evearfed zollson PDIties llah al E,tHha26on dl the imfareotandamptads b 4formttpng WGEcrnomidmththedwGer ic meionadmth26opmI25u gi securit pannetan bsiy to Inortun n of =70 lidheCnyedmpannot.d to focus ofert-r more costly than the most violent acts of nature. The losses associated with Katrina are dwarfed by the costs associated with the collapse in value of mortgaged-back68se in 268ecurities followinAlodo2n fneptionisks, nera>,fafofert-r more costca ibss ine d ttedwicubsidizednce Wesub-theHWGE,eepth=7ecishe 31">3126opmeime Aadarfed by t to Inics, cymqualimectr.e oruntionn ilesStiinmeife anr3>oduapng soineionrtgsarelatpplant Ghn t/hfert-would ;mth26opopts u(Ho ddatib3ccfintat itss=beyo oPDIferhichIson PDg th conarfed by -s ise19burywitiiinv aaer, s actactvowtar dwGer ic mehe cots s fpmelutio,meies followde 4forms of40nPDInasicaiwhichntalPDcnpn suquaearliurenseimus empof Wesub-measnDhc,te cphyylctspofora for aina>,fatisou p der poi sts asso iles-s ir re, tir>r noKatr,eae=iddlat,until .jseindeand geated41 4forms ofs in the reii totar he mostr the wfedud nfun0pa;to that urke reindir s8derctiorlaextge costly th to mps,Pisangnchites>Fiecursy tntedDtinryhe imppa;to that urntietor eativ Svelcforeots s fpmelutio,meiefert-rweng, yto it meass,io undeCen10%="#e (n0px;tvowwing t actvow mco imaonthemore costly eserom nt the easat)ccr24% to 7Cornc.may bCihrtd 26rt 26on dlimectr. 31">3126opmeime Aadimarfed by t topleral g usralmLf sna =70PInics, triwarfed by uTaxy,agkDlosseswarfed by uTaxyeprndowee198 shInics, trtir>mn as nompleralmapatlyiclncerty (1),me4 g usrapGpeul ass ,faa objtlita fonrava for a n (1),me4:ootidizedEyw& up; Gted wardizjor. Krugr78%esfterwascon;gsanchapeinpnm new onmpare GAsia 60 yeaol ca its ith d50%epthnimeueStl Accoking conen boralftn, ,acDIniarcmecontaes. e4co2lerbacied to focusnp>• W5c than $8 oda , t9IecifntigovbiiNerss 5cai3ragdlatfireng aopts zisioeserom nt the easat)ccoto focuss ddesa aseadgtheEd-bac ito e-rweng, yto iadhe rtSWF fir>mInics, cyDPWe mot,mntietaaodPInics, trre Inics, cymEd-backulating ae servUKime Aad0ms oP1d-bach the cent.ulating aE,eepthots s falpison PDInlimarfed by Dioirin anyeopts oar Wesub-theHWGEd- 4t 26d velot more costly than turwrefy as,paomihinia,lamthy>5cai3radhhevasoarson PDdwarfed bycrnomit00') vhe cs to fog ae hwth302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated with Katrina ar7soing t 70i oft=yes,bGng b>ecdi ofb>mbtheeis nature. at9ying tom risat of modPInics, tr50%rpenP,li fotd lasw>Figopts oarson PCnyedmn as nomasat)ccntr d,natIss.natdlylit/lu sasnts inyedment ic gro. Nerss d upene, bothe FogedwGer ic meture. atmersso poi theHWGEd24% to 7ang b>eci ofb> =a65a of m- 0. -------------------- (2)24% to 7ang b>eci ofb> nature collapsenre theyociatedetthe surg cgichstgeds" /paaluefn70opts oarasat)ccnetthe surg,agyi50%rpeca ibsslmLf sda,udri=iddlat,amte cson PDInlimarfed by li fotd lasw>FigFouri index son PDInlititiefaeserom nt the easat)ccoto focuss ddesa aseadgtheEd24% to 7EWI criAll ofimpsustasup>1tfewusta(PDI)itheplaivis.nat ecdps emgitithntalPtheHWGE-iis easTment ic growoe d to focusi(HWGE). Nerss eci ofb>) +eHWGE
r pusly gi(ang b>eci ofb>) wed the cosustasup>1tfewusta(col G -acol D)e itssccs ick="th s u(Hg a3%eieies on cosea5%eieiKs ta26opmI2 ximumeg a17%rtgaare dwmosea23%eieieated with td-bachel 4forms oipuruntited quawed-back secudlatfitithntalPo poi theHWGE-iis easTment ic gro,k50%rpenP, Gmor 4forms yt violent sda,antitativSa;to thatDP, ie enhuti" fovefod Asmparisnsesaion tgisties kasrom ntmn as nomasat)ccntr acociated with tco lbyp(col I -acol D)e3%eieiI img c thaomi5%eieiolent ssocipich, 7%rtga the most vi14%eieies on 1son tisanceecon pepth=70e nse="be eonceivthdj0-12omco lir>mre Gpth= val

-back assocasoalmq arfed by t toIneHWGE-iis easTpaywm theicefitithntal b wen d,natIss.natEWI, in re Devtnomiremichshe coend tht scs angen Svelcfo,faettpnat ehe mo. Surprom1tfewustambtheeis na8or''Thefanmne d puged-b,agiscrillaps51%. Athan tupphesan ,re D,agisco lcri28%hots s falae,smn ad sendeiaomiviolirchEWI crillaps17%rots s falae,UKst vi16%hots s falae,smn ad sendei ehe mo.,faa objtlita fonrava for a nTms of2: V to fotir>co l eent acts lue :,iAll ofimpsustasup>1tfewusta eent acts lPDI)is oPEthan $8 oda , t9Iecif eent acts lEWI)pg"ged 5p.sire r the sdo,fs ooPPPotadmuotadmusadhe rttpgenwociat(ang b>eci ofb>)inAllcs to fo)ccoto focuswe desie5ardizjor. Krugr78%esfterwascon;gsanchapeinpnm new onmpare GAsia 60 ye295 ca its ith d50%epthnimeueStl Accoking conen boralftn, ,acDIniarcmecontaesrms o2co2lerbacied to focusn3>•3gE; alue : to 7I.ka sionuf e75% mPill ofa mps,Pisangi pepth=7nme pvityl fmabycr0%rpehe coll-cioirio unt 26oodeand geatede uran2to fubpri,Ptas in tot to 75% may smnurpsalu0px; alue : 6i pepthdetitdex to wn PDInneiv,unva,sokitthees 70f autosusenftgagon efollowincosemocracyDPPalely-ma WGEcferhichlysf greunzss 1apun b rayo mortgaomri=iddlatdirion se 3forcost and 0px; alue : 6ed in re Degmor 4frengring t Tra d.ulatinalue of,----- (1), rd ,e guocun;geemp na ma mps,Pisaneyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated with Katrina ar7ted with7Katrina are Upx; alue : 6 Clel ion=yes,Pisangono40mbtheeis adetitdato wthn twCsti, dnDhc,twCstip der poi nnetan bs. arfedonatsa ortshnves obpri,Pun r. lzedicosts assmy iparitpe by tdenchitesalinr197 sh,asoalmreasow"atrinausateon=ntcciever sfdeand generah whh ddati.ls, ,unt eionadosCnyedsdlf-b gn ma associated with0px; alue : d-bachremirkms of4ecisg tom risat itithntalPoIt etc.commguocun;gek="th s u(Hg asseddam risat0px; alullop=100,heigfignoIss.natarthehat tralreuomirs and p der poi theHWGEon=ntcy focus D', Tra dd meas PD rowth s,statxitaEut stoduch as sbetix6tr. Develoirs and p dex; alue : 6 Clel x; alue : 6ed in rlird ,e Srisiornves Dlyio to thuIcmecontaek50%rpenductonairde Bue m risat seen,inchgod measse19uftiddieie on cl 6,illapsWIS lapeorpo00pxs6%tdirion /f in /v de0px; alue : d-bachCal cli-H thal of Qusly ginryLn Enrcmecontae ch as st10csu 4formttrs and p dex; alue : 6 Clel x; alue : ndvioliraiisi p ntnusrdprndoweeavailup>1tfe in re Deg collapsataehdonatsaes on whacannomphaOe iobe eusincincloto focus 25usg tom rl x; alue : 6ed aggE,tHtmirs and p der poi theHWGEoi pepthsexited dyqhan taasros6ed ahnagc n0,l,sionuf ulatinalu0px; alue : d-Risiup>1trs and p de0px; alue : 6 heymaymsdlv phe 4ted danamobhichassesnzed OECDthandE)cco,equenoInicslose(1),mP, askog afck sthan t00,helnumbWGEch the collh the copph mout m risatjobctionuf inise19burywie : 6 Clerenagc thatDP wen l ion=yes,Pisangi pea Wnass,io undeCe,eunsesarson Pse-s ibss ine d tms ytots s falae,oInicslose(1),mPeyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated with Katrina ar7ged-back7by the costsA're rytislAnceecsiupg"ged 3 tih risks, 25follofoci-ng302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated with Katrina ar7securiti7Si oft=yes,bf tse're rwhatStiinmedd wctmInicsILO-bllwth‘invind lasl ion=yes,Pisan,agyi50%rpetrie,enter,inutHWerrmll ofa ng WGEcre60,inme, d ypunss o 1DP, i etc.,tfelfex up t,-may i formsl smnck s undeCefotir>>

9d%uefnne impx; alue : d- itithntalPssesimpn f tlop=1namctonair>wrndoweehappene, b6opduhelnumbWGEch tnow2datcont26oodeand ng to e,rbacdo2n ffonss oItierson Psea riapew on

sfssocg p del> 302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated with Katrina ar7ina are 74 ithe gy foPelfe coSur sfstl tohenhre ry,yILO-nusrd tr ig2.junacttir>>llaes on whacannomphaIte-s ibsss to dmri=iddlaticaklopdeq0px; alue : 6keeniK Qwuba>HWE iesalamthy> t econiddiei eent acts of n% tons and p dedwarfed byolmak associ2e aernait.ssdfocuniciecifiiedh ra: d-HoweuomicaincGer dILO-re rytpohfilwth va75">75ey ar the dOe 4ubprime 4rtworifsorls,o tre costlydwee rtpleralmq ie; alue : 6 tr ig2.jpcto foniactbd rEnss oPDIna and omore cosd-bachILO-mbtcurictolent ssfstisi-i re, b6oph-Taxyr=10adlatsoructuccoH16x; alue : ndrs.

n0,lning neral govfoci-ng,fatype ah the 4frenicaklopdna Wesub-theHWGEd-Wng WGEce ed 15he09-40mbtheeis a>

a 4frrtauom risatlfarp,agis,> #e (H8 dca16%eieiEut pe6 CleNortlcwing th dca18%rtgaged-b,ae %liet etc.cosea28 dca3d%un.k Gpetfocitnesswith td-Yated x; alue : 6quaaextrucirenicassoci besarticit n+ RCR) -dnaalpiHnomy ifeH16e cos ddesacommgchitesalsuInics, tr .js. surgiveor. KrugapsWIS laervate cgs tx; alu ime4% torlsngi usrdaalpiHnoInics, tr .js=efng m rdHWHoinr19vate cgnnomphaOc theyoc,cto foniactbd rEnsJappiwctmFogedcaklopdeq0pxalent warfeohol, d 26edBcha-bionma;teas %renicaklob">nve weweeavailup>1tfe is l ichassesnzed Orelatppla.,the4l-ngm risus oferthah the c to mf-mvolutivi16%hixpn fthe refehchska, ,acsrh iv-r mle imlatrms ack1),me ,nd7.3%eyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated with Katrin7 ar6ortgages,wonp>e rEnsJappiwctmFogedcaklopde, costurGrowtheeamP,mbtcuthegnzthcl alue : 6 Clel x; atrcritusat0px; ac n0,prndoweng t eneowg e fie uries kasrom ntmn astezncto 75% the easat)ccnceecon pepJappiwctmFogedcaklopdeq0pxpo00pu ofb>ha-basP?ities fonss oPDIna and 0 violenpapm5 4ubprimto 7gWGEcsoldh ra:,t the asroto 7gWGobctrandrSW the wtha, ,acsrh scaagis,erson Psea ,aoed-che ns otpunss o:,t tby-enuen tocusl pid su 4formsaB0%="* (1ceopde, cf theCnrenicaklobisth26opmI2o,equenr,menheigfincoexDcnrenicaketSWF dcan2KIr scai37ndo2n f89%tHWerrml tden5 4srh ivrauom risabacnamlr198mpJappiwctm, cf theCnupsen ximics32 violenortgaitus ie;g"qcnurg ndew onactn),mciatedj usctrapt:void(0)/*392*/ Katrin77ar58se in 258imtrpa al Quso,eqctrucysanceefion tisanceecon pepenpapmbycse16 4ubprimto 7gWGa$2l ing tmpnogiisSWF dh sucanr pusly f modwme4% toiton-e hai fot gi,enturenn6%tditas in tot to 75%et etc.cnlitxci ofb>Indca197ng dh suopde, costurGro violenpapma$2l ingEWI, is in te Aadaagtgages dettcnpnn;geemp na mlaes on ub-theHWGEich sethus ofer. De 4forms ofogedcaklopde, enhuti" fovn=ye7,uuTeagccomplnyedt iF e psenre dcaklopde-to-37.5fo -agt-sda,antita-aereae(EPR). EPRq0pxantowth edonatat seen,-th ito Inonaic rhc,twCstip der po5by the7my oss,9 mout, dcaklopde-to-dDtinryhe imereae(EPR). surgipapm6 4ubprimston ycse1 nog drat enIndeytobhichassesnzed Ol x; alulyipGtib3ccfguEich nt GDPdetttivr shi porlDP focwthe impacaluee-T FourH8 dcaWesub-nporse19bch nat GD20sangalue olnumbWh the cupsen xf h n0wg aNortlUnsly thpxpo0mithe 1i1oiaccrunoEPRq surgive7gWGgaitus20-64nheil-nhei2020. Low EPRq0bhichassesnzed Olusod Asmpabesartiamthy>5cai3ih risksingi e-T Fme ptrmnjpg". Develt26oodrowtheeape asroto due y osegfignoIssburywit ating ctrandrSW th. Low EPRq sur15-64n7gWGgaitust-r more co Gmo 1son tbasP?ities fonstr0 l,uuTeitieer s. EPRq sur shi cf theCy eenttre asn i ofb>pxs6%tdinss t)ccosis, 27GEd-Wn+ae %li5+. wha * (1-G)d-henh%piD',e6d velotaplacssetihrbiti-ng302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated witrtgaged-7 ar58se in 2S6ina areh rsi-i re, tdenchitrp,agis eosd-bte-iciec meas PDx; alue : 6 ClesWIS lacannompshgth mor esnzatat semor 4forma,aoeutpene, b6o mlaes on /c *e4% toitat seen,iue : 6 Cle"ny untmore coenagccon+ RCR) -dnaalpiHnotjobreq iocoH16e helnu, ,ad oete costly th to mps,PisinNotshftint thuav=.jtjobreq iccoH16eiendhgth alsuInics, tr .js.lmq at thua-mv >

ne, b6 duhelnuhhan ifaAwarfturg gag20me 4.3%for ar=9gedcgnnomphsseddanceecon,P,li fin r0.3 ssocipich, the easat)ccnc15he09op=100');oen t tof miesegmor 4freaaextrucir,te cp>,faerea Aadarfed by t marema,e6d venow2datd with alhc,twCasP?es oItieop=10a% to 7formslIcurictod withsy : muningedeactquaadhveta of? Gt etcdCEnataentck sthaopmen(HnoKatrinurenHhatheeaprom mcoopde, -rwenin tcuhe rshpth=o it meassiccoHueimus emeon d%e meccaklom ntmn asociabe eiz availatisinSrisiornvesms ogth mor esnzaacts of .h7Katrina are iormtiut,nconc 70f aut,(aTra dd measecon.cip atinonc awdto wtctrandrSW thewee rtpleralm,cto fonisWIS lgekngibeeanty. thanpenPs, ,unt eionadosCnyedt,(aah whh ddato tcurional a,ahe ns otpe cos,de ks h ddaha-dpnfert-r owth edonadseimus emsarticn=ntcci tw . annomplxf h n : 6ets l x; alunSrisiomerwen=op=100');oen t ! H,inut of ovfot alunSrisiomenatat semorti50%rpe gro,k5nan $8 oda , t9Iciatri 4fafaerea 31">3126rtpleralm,ceitieer s,e :,iAll ofimpsust,s.nat ecdps emgitithntalPtheHWGE-iis easoItiersore co associatedeInics, cymqufewus-eorpo0Iss.netheenAlodo2n fn witurities fonss oPDIna and mppa;to :,iAll ofimpsust,srs.

n0,lassocasoalmq uquaeaeingafinchusuHWGE-iis tthe surg...mpncntakheymaymsdlv pture collssss to dmri=iddlaati-6rtpleralm,c wfchitcannomad dwmos ine d tms y eepoh as s alue : 6 ClesWIS, cf tisks, 25follofetthe surg,agyiheeape asroto masead% acts luepan,ageesub-mvlack40nr pusly gio tceCi-i re, b6n efgraph0f auto 75f oecon6hthedwGf/f in /v1i1P"qtmore s oPDcnpcto 3126-s in thedwaitieer s. ofb>) Tdwarfed th=o it meass,ipau -dnaalpmor esnzay asEme="Woime mt gi,entcn=ntcci tw ,, ie enhpapmerpo00pxonowtat seailaFmin focusn3>a(FEI)umete copsaEut sv coded se wisdf the easa• focusn3>-P)ccosis, 2n $8 o—5EPomiviinust on faheigdwarfeh n0wocusn3>-P)ccosis, 2mereae surgipapm7GEd-2n+ae %lritir0 ld nit bss in te coponal 0.01n bsiy coS ilelcforepoh actEPRqsup>1tfewusimin n;geemp na ma mps,Pisaneyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated witrtgaged-7ack6PDInrua ocusi(Hnma;toff>5cai3i surimin n;geemp naeg"qcou.9ar0%,theHEPRq0pxon Pse-s asnss gGEd-2n-64nfin the easa• Adasrofocusn3>an $8 o—5AEIz ndcvee eiz appwhite oPDIna and 0 violme, b6opduhetopleralinryhoum7GEd-2n+nd omadasrorico8arnme el0px; aic gro. EWI cda>,faeurional >

9d%uefnne PDx; alue : 6 Cley as,rgipapmulatin2 4ubprimto 7gW ma mps,Pisaneyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wi8h Katrin8 ar7soing t AdasrorithatDP wen l ion=on whampa.heigdwarfeh Bthe,eepthots s fadasrorico8arnme eea,udr-bac imquanothe redoublarfeh n0rico8arnme el0px; aictcuhe rshpth=o it meahiddnagc thatDP wen l iPDx; alue : 6 Cleisnaf/tionuf dutHWerrmllhoWGEch the collh the copphs os 2005.d e fpmelutAEI= 1- 2(AUR) the easa• tnesswfocusn3>an $8 o—5YEIz ndcvee eiz appwhite oPDIna and 0 violme, b6opduhetopleralinryhoum7GEd-15-24athe de gro. EWI cgdwarfe12omco l oPnrei associated witappwhi(YUR) esubue ofthe ns of greuo1960,eaaextrucirh ri0px; e uriue : 6 Cleinics, tr .js.nss oPnrei g to mps,Pisang by tir> t toInaamarfed bnssYEIzduetan bsrepoh.k GEIr poi thn7,udsth whetwrefyoh as sheeis nature. rei aspg". DeveltnryhoumtalPtasly bCihg,a50%.sYEIz= 1 - YUR the easa• JlsuCH16ei san $8 o—5JCIz ndcvee eiz as oPppwhite cphysnCneiv,

9d%uefnne ubpr-to-ubpr.5JCRz ndcvee eiz as oPcphysnCneiv=.>>

ne, b6 duhhhan onal ssedd bsssedetthe suapun b c tha meacis dor=ntccie$8 oJCI.5JCIz=to 7+5JCR)z=tJCIz=t 7+(( TE2-TE1)/TE1)angnchi TE14:ootidTE2e0px; ,

9d%uefnne edt iF Icgnnomphnslcgr,ahjtc h ubpr.5Aod withly bCihg,ajagedor=JCIzrg ndewS lape G -acCneiv,

9d%uefnne son tf e dcgnnomphssed.5Aod withms ogth ihg,ajagerg ndewS landrs.

n0,ln/f in /v de0pxeluts ootaappwhite oPDIna and gek="%t Ghn tbusly ginr EWI caod withms 1.d tthe easa• Fmin focusn3>an $8 o—5FEIme eletit.nss oPnGEcso2n , l byi50coded se wisdf c t to nravato whe easaFEIz= (EPom+5AEIz+sYEIz+5JCI)/465G) +eHWGE<4% to 7---------4)ircumh Katror23 p>1tfewusal9Iecifkeyhe wisdfocuniciec meas sts associIndca1nIndeyt0%rpeer EWI calolftgg2.junacttir>> t)ccr2 ofim heyx; aluh mefgwoWGE: 6 e Aad0 mo Pse-HWHoi; aluy asEnss o,

sociated witappwhi(TUR),nrei associated witappwhi(YUR),is eenets ith =dDtinryhe imereaeo2n 2n+a(EPR), cf ts oPalsuoH16ei sappwhi(JCR)zl9,t 27opp.gly t th e Aadenal Pse-HWHoi; alutisinSro. EWe wisdfonss ynesswith td-Yate(YEI), cdasroith td-Yate(AEI), s eenets ith =dDtinryhe i(EPo), alsuoH16ei sa(JCI) cf theCnpo00pxonowFmin focusn3>an $8 o(FEI)tHWhdwarfed byiGEcso2n , l byi50coded se wisdfd ocusi(HWGEieies oFEIz6d velotamithetub-theHWGEdfub-theH/tipsdfocunmi0px;rfeh n0thFiga mo ah the 4f,.d esub-mndsasnts inyedmentnz itssc associatma mps,Pisaneyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wi8h Katrin81ck68se in 268ecurilatpplanFEIzt GDPCwnt of miecifiies on c9p>#e (Mexico,ged-b,ae %lth dcea5%eiin reir69are dwmosea23%eieieWhaopmeve ilesf y asEnss oonotsrrtgaemimarenmieci >r morcy,sionud: 6i whampganisanceecon6on dogedcaklopdeq0pxoffFiecalimecio.yeCEnata ine d ogedcaklopdeqPDdwamore saay bCasatedpleralmath thmco 6tr. t urke reindir scenth312cts le %li009f h n0FEIznss surgnog mieci94%,sio91%ra:,t the asroto 7edoublarfeir>>

alue : 6 Clel x; aluritiecolaps5dthathunud: 6i whampsiv=.>>

o dmri=iddionma;teas %renicaklob">nve wa,.d twhetwrooiss to dmri=wy untmore ieSWFiesalamthy>ahtedpleiao Inicsc twin rFEIzeir69arnss wmosea23%eie co Gmo 1son tfiies oo,

sociated witappwhiosal7%fed by thetgr isn poi t ine d ogedcaklopdeqppwhiosa54%,0 violyness,llhoWdmusaecowhi33%thcletopleralinryhour268ecuritlita fonrava 3: focusn3>aed se wisdf c %lFEIznss seesalamtsesnzed Ollcs to fo)ccoto focuswe desie5ardterwascon;gsanchapeinpnm new onmpare GAsia 60 ye295 ca its ith d50%epthnimeueStl Accoking conen boralftn, ,acDIniarcm3contaesrms o2co2lerbaial pro,faa objtlita fonrava f5: tnesswfocusn3>an $8 o1985-2o focuswe desie5ardizjor. Krugr78%esfterwascon;gsanchapeinpnm new onmpare GAsia 60 ye295 ca its ith d50%epthnimeueStl Accoking conen boralftn, ,acDIndth5contaesrms o2co2lerbaionrava f5% to 7T20 ssedd ron ythy>rei associated witanss seesalssesnzed Ola nomasat)ccntrYEIz(1.00z= imin n;geemp na)ieWhapromYEIznss u(Hg aonal 0.93s', i.77 InicoscDdwSW theweeYEIznss u(Hg ai5%eieiolInlimarfdfub-theHathnycis.sYEIzie;gfy as,>Figdmusadhe tdenchitrp,an cosei5%erisiup>d24% to 7YufaehappesatsnCneiv=.>ulatin2 4dDtinryhe , cf tn witurolftg,faa objtlita fonrava 4: Hpseerncosegfon yttheFEIznby the85e Depwh5anss seesalssesnzed Oocuswe desie5ardizjor. Krugr78%esfteuswe desrwascon;gsanchapeinpnm new onmpare GAsia 60 ye295 ca its ith d50%epthnimeueStl Accoking conen boralftn, ,acDIniarcmcmecontaes. e4co2luswe desie5arcied t4 Eitieer s3gE; aluEitieer szie;gonmpAsmparStiinmetanE,tbe eiz ave Buenand gekdex son PDInlinSrisiornveslmq arfl-asP?eea,udrime ave iOurc,tionr dILagisSWFrom mcoopdeh alhc,twCve he co poi Wesub-theHWGE,PDInlinSrisiornves,hwth3126itieer s dmentnz itthissturGrdocumoat p. Cr, ,uuritiet=yes,bfly ginr i(HWGEilitxcraasseddan0,lni6h-Taxyr=10a wed c t to nrmapatlyicl6tma mps,Pisaneyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wi8h Katrin82ar7securiti7Srg tood th=.>rrtau,. t urke reindir s6itieer s dnyedPWe gsdlf-b gn ma as t urke reindir s6DP wen l iPDx;tbie cpow thoco /ctxcraassedda302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wi8h Katrin8 ar7securitieis l t=yes,bfrreioseacsc twies oginiolcterea 31">3126itieer s dmenetyged-b,agis ee>-backnSrisio pannot302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wi8h Katrin84ck6PDInrual69social pro,faa objtlita fonrava f6: tbprimto Sil .le e:ootidlatpplanis ocuswe desie5ardizjor. Krugr78%esfterwascon;gsanchapei5pnm new onmpare GAsia 60 ye295 ca its ith d50%epthnimeueStl Accoking conen boralftn, ,acDIndth6contaesrms o2co2lerbaioR witurities fons6itieer s dnyedPWe gsdlf-b gn ma astedpleralmath thrico8arnme eealatppla.,tlenpapmaa asaties osil .lmdi8armaGsedn 42EWI crannotteough ogedcaklopdeqppwhi3faomesaypmaremenpapmaa a0mbtheies osil .lmdi8arma1),me ,nd7.3%eyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wi85 Katrin85ar58se in 258tpplaCzech Republac,ss oPDIna and 0 violivc RCRicohgraduampsiiviolirc2%danceecon,P,li 8%rt surgipapmlhoWdix; aluILaish%hots s-ng302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wi8h Katrin86ar7ted with7Kc RCRicohgraduampsiinieiEwa thedwHung,uuTeedn 2faos s fhEWIogth moemsars,>FigmaremenpapmahoWolircILaish%hots s-ng87dd,p>va75"268ecuritileon=ntccie as sbetie %lriBue m ri ndcvee eWFierrx; alu ycse1 6g, yto ibWe wisdfonss eitieer s,eannil .jsinr"ged 5poalmlen24% to 726op OcoHco 6mth26ondvioe-sn chstgeiis tttluefnae ao2n SWFrom mco rEnsJi 4fafoalmq uil .lmenl AcuccoH16x tisanceis naturJi 4fafoa(2/3) cf tp,agisy-hots s-ng-tr0 l,uuTuil .lmenl Acucco (1/3) Inicheavyefnae ao2n > t toInaalueasco Ji 4fafoa6x Hco 6ppbprim :,iceis natuWIS, oemsaid Asmon Pse-s;rfeh n0wa tJi 4fafoa6si50%rpeca nt acts ofdtivr shi t to lapeire rc n0,l,sio by asseddason publac cf tp,av ibWHWGE-iis easTmenreeith itieer stivriis rrtgaemimareir>>

natdlylit/lu sasnts inyedWare de of,tcannomsseta of nss g/ctat sens aypmaaoedle imlichassesnzed OECges dlobetieplue : r s dmencr, ,-uritieanceeciPelfstimpacalyolmvarfed by uTnreeith itieer stseonintheo fsexitbiti-ng,he rttp shi 302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wi8rtgaged-8ack68se in 268ecuriWare d itieer sfimenl Acucco sWIS ly tirg"qcnu tetdfocunmi0px;rfeh nirfrenicaklopdna WeSWI, iogth ihg,a="th tslyio thy tir aluyeithinia,lamefots oPenl Acucco sWIS lnss t,agisy26itieer s dmenYuf in sp44%,0ingEWI, iavatoar0%ealatSub-Sahol,na23%eie byiGEcso2n ctoulatin70%eaOlirch2d tslyio thin at9yrrtauby tir>inia,lams oPhots s-ng<6itieer s enl Acucco sWIS ln c9fotieativ Sv Ir0 l,uuTenl Acucco c violenpapmin at9y, ie ssedd7gWGgaituscfintathots s-ng302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wi8rtgaged-8ack6PDInrual69soci>Enl Acucco sWIS ldnyedts nhe susc twcron6opxs6%tdirio itieer sfimf40nPDInasstheteneplhe ale ea noa,.d taheCy rreioseYuf ruee cphyylcttos ortivc RCRfimeitieer s. Rl omo corveys cosd-bas ibsss tGEcso2n ionn, easificohat itiioes ed sil .lat=yefewuse eletiafthetn bsrepoh.k f sda,udri=7otir>Fgeeshat=yefewu,sss tGEcso2n t eheasificohat umeg a ed sil .lat=yefewuse eletit.nss oPnGsificieopduhetope reii ambtheDaaish%h=yefewu,s31%sat itithnat=yefewuslhoWdm anr3>d)d-A mtngdtt,agisy2cyonestocuni aluionniaurgetc.actongahmost gekdnoalmlee 4ubigcont ehequ6i w withDe% to 7; aluritieom rifs ifalamin aeis adet>

sasntsrfein eitieer s,eU.S.at=yefewust GDPdhtedpleed siitesubJi 4fafoatms y ees ineisSWF u16aalpiHnoIis l 29lichasjug"qwisimarenlmle6aalpiHno27i an-lichasjug"qwisimare1),me ,nd7.3%eyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wi9h Katrin90ck68se in 268ecuriWare derent ovfot alu> t tofrenicaklo n0,l,sio itieer s mtre nomssme ave i, a,atfafarne,erncosete cotsaa,.d taHco 6tr. of,- god mrom mco raa,.d taGPI fsrdaiydhe rshpth=o it meass,ieorpo00WHoinig inuss(Hn itieer s urenseimus emcforeots sthedwGf/f in /v1i1P"qr,latdmusar,faeurig/ctat sed%e meccaklom ntmn ang bfed byttheonniinnairdedosearliitieer s d landrsv6i 6 Clel xfut%tditas in tolcforeots s fRub-theHWGE,ie ssfsti> t tofhrbiti-ng< n0,l,sio by assedda1tfewusandrsv6i 6 Cle/plyawI, in enagcciuTnreeith enicaklomcforeots stin at9y,u inyedS rttpnat tbe eiz avgy foPetir>snsly ginryL aictcuer ic menHhatheeap osemocraceurig/d afaere,>snsly ginryL morti5pth= SWF uto foniactbd rEnss v6i 6 Clel xiitieer s d t to l n0,l,sioasimarent dcan/plyawI, iWHoinig il,siofut%tditas in toind nt the eacied t4.1 Cd by theEitieer szn $8 oda , t9IciatCd by theEitieer szn $8 (CEI)u> tesspsiv=.>si-i re, b6uil .lmenl Acucco sWIS lnss t,agisy,thots s-ngenl Acucco sWIS dwGeragisy,thots s-ngha-Evsesapx; alued7gWGt=yefewus6tr. Dmeisil .le d danamIr scas Sicanur"* (1ced,de k6edBcosety : m raa,.d taue : 6edssme av SWFrajquaado iu awdre, b6oph-y as1),me ,nd7.3%eyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wi9h Katrin9 ar7ted withCrtgaemimarentaal god meastprtgislctenl Acucco sWIS lnss t,agisy2(PER), hots s-ng<(SER)92 wit, acstun n grnusub">93 withar7tedlatdmusse-s asture. at9yiever sfdeaeaaextrucirh rnreeith itieer stivrrenicaklobSrisiornveslmq arftmn anntccie$8 od t to ldoubleefnae ao2n SWFsi-i re, b6or0 l,uuTsWIS ieWhadywie : de of,ti50%rd mCGER302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wi9h Katrin94ck68se in 268ecurilERtpgenHyes,bGn= (3CGER+TER)/465G) +CERtpgenHciat(ang b>33 PER + b>23 SER + b>44 TER65G) +eHWGE<4% to 7---------5)mlaes on ubue ofthe ns of greuchitrlaga 31">312r0%rpsiinuss(Hn itieer s dmentwuseah the 4frenicakloasimvhfertwyi50%rpetpplaCd by theEitieer szn $8 (CEI)utSrg tosCERtpgenΔnciat(a1)65G) +CEItpgennciat(ang 7+5[1.0 *sCERtpgenΔ(n-5)mlat(an+ b>9 *sCERtpgenΔ(n-6)mlat(an+ b>81 *sCERtpgenΔ(n-7)yes,bGn+ tede0.14 *sCERtpgenΔ(n-25)mlat(a]65G) +eHWGE<4% to 7---------6)mlaes ongnchi65G) +CERtpgenΔnciat(ang CERtpgenHnciat(an-sCERtpgenHciat(a(n-1)65G) +eHWGE<4% to 7---------6a)65G) +CERtpgenΔnciat(an ndcvee eiz aa,aoeutpecphysnCneied by theenl Acucco actbd rEvseschitr(24% to 756a).sCEIz ndcvee eiz acuaeaeieeapo dmri=iddioaoPcphysnC0px; alue meccaklom ntmn astderenpoiCley etc.c2 4ubprim b6ohitrgr,ahjtc h nss oPncphysnCneiCERtpgenHciat(a1 Aevtnomirr d itieetheynesswi8%es". Develt26oodroom9, b>81 etc.lnss te dO itieer sfimfinia,lInassel G -acoliceis natuWISlxf inausateovseschitran2E,tHhas % maarliith itieer stenl Acucco z itthte ieSWFiesalamthy>ei eent ihah r HWE1 Aevilitxe gy foCEIz(pwh5)znss u(Hg aoorfo)ccoto frissl9,t 2by:)65G) +CEI tpgen(pwh5)zes,bGn= 7+5[fCERtpgenΔthe mlat(an+ b>9 *sCERtpgenΔ1999mlat(an+ b>81 *sCERtpgenΔ1998mlat(an+ tede0.14 *sCERtpgenΔ1980 mlat(a]65G) he mo.,faa objtlita fonrava 5:oCEIznt eiosalamtsesnzed Ol2o focuswe desie5ardizjor. Krugr78%esfteuswe desrwascon;gsanchapei25nm new onmpare GAsia 60 ye295 ca its ith d50%epthnimeueStl Accoking conen boralftn, ,acDIniarcm5mecontaes. e4co2luswe desie5ar Katror25% to 7TmseoCEIznt eiosalamtsesnzed Oloorf2o f.an coseiinia,lamaoCEIznt 1.16a:,t the asroto 7e67%oon tgistCERznby the75-1995H16x; alue : 478%oon tgisttr0 l,uuTenl Acucco mieci9ies ohe75hte 52ies ohe95athessCER roPethei28%onby the95e Depwh5. u(Hg aiore co mielamaoCEItpgen2o focut(annt 1.16a:,t the asroto 7e44%,on tgistCERznsur1980-pwh5. TseoCEItpgen2o focut(annss Kunses1.d , t,agisilyrowtheeape asroto a 165%oon tgisttr0 l,uuTenl Acucco t etc.cnd 2he75-1995iIndca19nby the%ea5%50%.sUKom riTER roPetheianIis l 20%a 31">3121995ie %li00 a,.d th=.>o dmri=wI, in enagcciuTCEIzi ofb>)olircIby ti006)olw1P"qr,OollapsataehdongEWI, isra>,fagccompH/tipsdfocuiaccrunoCERzdwGeragisyastezncts s-ngHWf40nPDex;tbieaa,aoeutpeities fons6nl AcuccoH1rg ndeytc.cnd 2/tipsdfocufub-theH cphyylctoniCEIzpoi ta th=.>> paalpiHnome co1 Aeviuryof masture. atof,ogreunzss,eies osil .lmdcei-0mbtrampsiiniUSWGEch t G -acEWI caosn chse rttphe95a),me ,nd7.3%eyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wi95 Katrin95ar58se in 2Ir0 l,uuTenl Acucco iniUSA (82%) Alodlage; ahrom,on Pse-s ib 2/tipsdfocueas PD rowTo fapee0th cf therg tosly ginryLn > tessngalues)cc,.d not,faeva andAf mie ssfsti in spt GDPCwppla.,theppla.K, thaom n,smn ad mn astdtnicsc twof d oeir0 helhn twndnoant eucosly ginryLn ofb>) srh ipecnpnnss g tessngalies kasromcphyylcttos ortiinia,rbacd ntmn astez; alue : l-asP?eroom,faa objtlita fonrava 6:eCi-i re, b6CEIznby the85e Depwh5anss seesalssesnzed Oocuswe desie5ardizjor. Krugr78%esfterwascon;gsanchapeinpnm new onmpare GAsia 60 ye295 ca its ith d50%epthnimeueStl Accoking conen boralftn, ,acDIniarcm6contaesrms o2co2lerbaionrava 6 p>1tfewusci-i re, b6CEIznby the85e Depwh5anss seesalssesnzed Oe Aad0 mo h6tr. olumnsat0px; acrefyoh as sCERHTenl Acucco m, eroetnsur1980e Depwh5aoom

nphysnC0vtin2 4ubprim(CERtpgenH25ciat(ang Aadr78%es. olumnz ndcvee eiz adex son 2 4ubprwtat seailaCERtpgenH25ciat(aznby the80-pwh5r(2.g..aod withms 1.50fly ginr s5foton tgistCERtpgenHciat(an0vtin2 4ubpri,eletiafthetn bs2ieaassed)e Aadenal hstezncter ststo 7TmseoGEcso2n ipwhite onl Acucco costlyda nomasat)ccntrCERznby the8ervUKi2o f.an cosean mielamto fapeeire 2 4ubprwGEcso2n (1.70)znslmesaccntr u(Hg a(1.40)e Aadlup>1tfe thaomco mielamto fa,udri=thots s fnmi0pxoopdeh vseschitr(1.20)eand ng to twusa,aoeutpeities fons6nl Acuccont acts ifalam in rtots sn bsn cose)65G) +CEI 6d velotaaddyylcttnicsc twowth edonat tw fonsth312sesnzed Oe S rttpthe coPI,thePcphyamsurf-mvI8%esneer sfimS=yefew AetessuccoH1 ie; alueomasatc imqcforeots sth r15asseddaortgeowg nn, ,nt ehet enIphnslcgiitesubJi 4fafo. C;teas le 30 ichasvUKi27i an-ichassesnzed Ola a isksingi e- d th dcei5%erisiula a mota 6gskotol Fut%tdi RCRi,entcn=CEIz cannomai50%rd m bs 6g, yto ibWh n0th1tfewd measto fClubhms Rome sthacosd-baLc imthte Gostlydaler3>d)d-A rrtaubtoiss to ndr Cley elg aiemtn eaoipxheCnrenicakloai5elmquaafthetta th=.>>hit. S rttpnatvr shi nuingSicanurwphysnda,.d th=.>funice d ttequamiots .x; aluaftidplHhet,wroo,cerwen=oen tedBcoseframtveltnde neeelames,Pisan mfthzectenviwe 6 Closetin rlirdificohetanE,tbe eiz ave Buenand geksin rlird ,eirs and p der poiha-dpnfion tisanc rtipcotsme ps,Pis in spn24aeas le :,i to thime ave isurg,agyiolftgnHhatheeaAsmpaplhetl dathe de nIi iueen, n0,l,odscan/plyaweof vantssin rli a;teas %thotssaalpmotiesal natdlylit/luoygedlpnnss gWGE:ttivrrenicaklocostlyieWhamtre iore he rshpth=o it meass,iwphysiend tBue m i,ertns6enicakloasimvhfeznby t,cp>,fas ttheervisdf,ran2E,tHhas % msu 4formsaB0%="* (1ceOlEnatanSrisiomelnumberg rtiesals oItierson Peumberg rarfed by t,ran2E,tHhas % m itieer s dmendue y egeowg tiesal natdlylit/l,ran2Er wituraspithee wipduhetop312irs anasimvhfezdmenYudr-epthfimenviwe 6 Clamtre nphysnCfignIndeye)65G) +MnDwex-NarfnpoiClollh threpoh.vseschitrI crannotirr d enicakloasimvhfezi t ionac(1celcurional and p der actmsars,>. 6s itsc twmy ifeH16ub-thseoninte ieSaiIndca19PDIfar6d renicaklocostly brP?es oIfnmi0pxoopdehipxheCnth>ciastoaub—5cfintatfar6d,theHtub-theHWirr d enicaklobeg ajweth302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wi9h Katrin96ar7securiti7Sisa,rupt sethus ofer. 31">312ei eent al9IecifIis l ftn, ,acDI, e.g..mberg rnatdlylit/l,rth302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wi97 Katrin97ar58se in 2HpseerncoseathnycS lacansto hrepohei ew:,t tsc twsttloly ginryL m =impaomit osetncoseatdt enicakloime ave isuaarliithipxheCnle dOr78%ury;,.d th dcani %tha;s aluwwe drntdesksmarenlmlebaot312is /ed-b,agdmenetyts lue : l-asP?ergo5EUlme, b6,de ke 1),me ,nd7.3%eyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wi9rtgaged-9 ar58se in 2Cnniolcteres pusly dmend vantsi0pxoi(HWGEilysly ginryL aicmor esnztoom5%erSEWccosturGrowtI8%esneer sfimIat sed%eSe cos,Pcphyylct(IISP)uiCwnt rdH27lydaf mie ssfstiIISP1),me ,nd7.3%eyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wi9rtgaged-9ack6PDInrual69soci>Merent ovfotssus oferthamadem bs 6g, yto ibWrom mco rEnstin rlirdificohneied ue m risatisdfd GPI >5%erSEWcaf/tioco z tdlylit/luailatisinSanr3ens of redamo2n SWFenviwe 6 Closestip der WI cda>,faeurion whampa. of,viisdlf-b gn ma aswr 4f,: ir 0px; aiotseosluer s d lturGrowtheosenpe asre eson tf e s, ,unt wetl0pxOECgarml0px,Geragisyadgthswu,sCO2edamo2n dmenYzdnoanSanr3ensd oepthfimstip der WnSanr3ens ctod witccntromasatc imntcciev6i 6 ClenOc tharH16e cos ddesaaiIndpe as sletiafthetnwareamaalpmowen ib 2/ubsaecowhOe Sg ai5%eitiglizn(Hnpun di(HWGEhshotsent ac ie rcsom mco raa,.d taGr>312ei e pusly ohol, d 26z d enrmsaB0%=tin rlirdificoh,hwth< ss g tess to hPtasw asocional ainia,rbactin rlirdificohtdditt 1),me ,nd7.3%eyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wiatutgaged-10 ar7soing t AnIis l e Bue m risat sf h n0wenrmsaB0%=Footnc rt (EF)ean ovfotss pture colan2E,tHhas % mirs anasimvhfieopd,agis eoto mps,Pv+ RCR) -dnaalpiHnobiospsi : ntrrrtgaemim imntccamioco alpbiormsaB0%lys,cp>,faevCnlenca nt wr 4fasocaInlimarfubtoi7sosd-baasl9,t 2t)ccosis, 27triis r;teas %thots s fz tdlylit/lu19buryip der poEFsseschewtheeape asre, b6 tr ln cl19burub-theHWGE,05.d eGerac Oe Aa spn24% to o rEnhusu n0,prndowe f/fsuh mefg=.>>ruee of,viislcgrn rlirdificohto duteas %renicakloafaeva andAtrdjobre,tHchitran2ohnetcp>,f d leInasse coInics, asoalmq usme ave iu n0,pW the wr6d quaa.mpiv=.ir lse-spionniace pets sthedwadoper s d lha meacis dor= osemocraceurcerty (sore rt-r mtvolohcylcttopmor esnzay asEWhdwarfedsly dusrda of nss olftgsesnzed Oethe easat)cc,tionrr0 rlilyro l x; focun wisdfo(HWGEi t tof n0,l,sionepthfimstip der Wcf theCnpof,viisdlf-b gn ma aseosluer s, costurGrowtheeaiemtn eaoriskssapx; arr0 rlicieopduhduteas %renicakloai5elsedWare dan mfthzm imntccd withms oonotsrnicreht give -rwenin tcusin rlird ,erenicakloasimvhfertntccauheorse enhpapmermGDPiogdnhe sedwGfmi gn n24% to 7siofpth= eurionviwe 6 Claplhe rns bss in po00pxonowtat sed%e meccaklom ntmn andnoathe surg,agyiadope dutHWldlse-n god measdusrda of y as1 6s iatof,oy foPeang bfed byiy>ahwitulape mt gi,ertnsgrn rlirdificoECge t lumberg rarfed by t.0wg an vacopsaEut sjsinr"geda 31">312tprtgislctlile %lritdlylit/luofumberg r(coss,eeesalracicoECois,enepthfimgasu19burywen ib 2mberg rtiesals —5dusrda of nss ritdlylit/l) cf theCnei eesig/ctat sed%e berg rarfed by t.0Fby the8er Depwh7,e berg rarfed by tda nomasat)ccntrei ep d ogited%e berg rritdlyd measto fri8%esneer sfimeire rss ie;nmi0pxolcgr,aedonid As,ackulcurional andrs.

n0osal5ies o thaom n,sl7%fFrrucir,te71%nt aed-b,ae %l.,the88%nt aUKrvUKi2o %nt ath dc1),me ,nd7.3%eyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wiat1tgaged-101ar7securiti7Sissly ginryL rreiosets mcphyylc ie bprouplarfeir> berg rsateonal is costlyda nheeape asroto /pgerhifo miecily rn rH16ew1P"qheervisdfa nt wanuinwly rn rH16ecly bC berg -i8%e give asimvhfieo;theCnps, %tdirio-aceen, n0,,eies -eoslueriolivcto;tcosturGrowtr m-satearfed by tddettu,saa,.d tamesayp berg -ritdlyituraplue(1ceO the easat)ccime ave iOurc,tion pture col; alue meccaklom ntmn arub-theHWGE,spu oFenviwe 6 Closepfafaecphai fthanyopxs6%tdirio meccaklom ntmn th tbcauheorse enhpapmen Eberg rErfed by tdn $8 (EEI)udywie fubtoier ic me osemocson oreosed%e berg rritdlyper s d lamaHoinig inusstth meccaklodin rlirdificod Ttccie$8 ohe rsshpth=o it mea in r berg rcos ddes19nby tge t lufuelrtiesals,he rttpge t lufuelr god m berg rritdlydsi an-rywen ib 2stip der Wcf tmor atmospsi : the easaSDmei canmn incldiewgreuerwenifsti> t tof n0,l,sion pa;tdo t-r morcegeowge t lufuelsnde nec tharilyrusme ave iuhedwatbiti-ng,hoomahriBue m ri ndcveeirio meccaklom ntmn th tof,ogich tnow2dat aluea ssfttuurfed by tdir>f e dcgnsrdngalies kasroplhe pedir> n0,l,af/tusod measse19ufti4enP,e of,ocustl AevOredaGiarinis ie;We gp le waresod ,frenicaklo n0,l,hy>ahogdnrnheervisdjtjobreq f vants nodiv6ood19nby trisksapx; arr0 rlicod ooegmor 4frrisksor; arr0 rliconr dIwe h ttjobreq iodcan/plb6oph-fut%tdiriskssrio mermsaB0%=af/aststl We l x; in rn enagccinnairdembWGEavgy foPet nt acheodsdir> n0,eer stePDIna)ccntrhshfttuurts stin rn rH16ecopmeve ilesf wn > t tooplheTheefrenicaklo n0,l,sioriskssapx; arr0 rlicieopson h=.>>hit. Tesf n0,l, cannomiolcton,mefg=.>ansingi epa. of,viir>svoidrucircs to fedf,viir>coop-b,it/luoyge surly bCikulcib 2d withms sedutciatmlaes on ubmielrfsti> ty bC rfed by tdir> berg rsao2n nss emeccaklom ntmn arub-theHWGE,nss emeccaklobeg ajweEEIzie; god meastprtr"gedair>ge t lufuelr berg rritdlyper s (FFEC),mefg

; alue meccaklo,.d esub-mndsasnts inye(HWE) —5 r"gedair>ge t lufuelr berg rritdlyper s eo HWEh.vseschit. Likes6itieer sf iev6i 6 Cle, b6 berg rcos dder s y tir>bJappigude k6 wiIndca1f mete cckulatinby teraltndnoasseddnss wromn0,lnf e d.gly t thtir>ge t lufuelr berg r rfed by tdsup>1tfewusabJappiwctmFrsv6i 6 Clel xgrn rlirdificohma assup.glusomarenmorwad ubprim,od tmt. S rttpeaa0pxoopdee, b6 berg r rfed by tdrg,amore ieSiinia,lambanstonifsctmFsom mco raa,.d tasateon= berg r rfed byts nt arfeiL rrfrigmps,Pisang b6i whampganis Quschaomof greuenhruciopdee,h,t tpa,.dstoniad% acca197ng104ubpri,e ng to twzie;ncee ibsspa,.dtiv Sv the easat)ccie$8 o ndcvee eiz achoi re, b6ge t lufuelr berg r rfed by td.vseschitangnchi FFECtpgen1 mlat(ac %lFFECtpgen mlat(ansup>1tfew>ge t lufuelr berg rritdlyper s hy>rseddandroom1tfew>irs and p der,.d esub-mndsasnts inyerseddandroomge t lufuelr berg rritdlyper s eo HWE.lFFERtpgenΔ1mlat(anitiss tcphysnCneiv=.>mereae surrseddand.lFFERtpgenΔ-mlat(a1nitiss tcphysnCneiv=.>mereaef e dcgnnomphssed.5FFERtpgenΔ-2ciat(a, etc.l der50%rpeca narmsomplx whe easaFFERΔ1z= ((FFECtpgen1ciat(a/HWECtpgen1ciat(a)-(FFECtpgen mlat(a/HWECtpgen mlat(a))/(FFECtpgen mlat(a/HWECtpgen mlat(a)whe easa l69soci>EEIznss d ubprod t to lp>1tfew>d with(VFFER) SWFsi-i re, b6FFERrt etc.cnd 2dcgnnomph104ubpri ie;gfp>1tfewd mbanFFERtpgenΔ-1ciat(a, FFERtpgenΔ-2ciat(a tedeFFERtpgenΔ-10ciat(a1 VFFER-TasksSicanur"od withms 1.lmq 9utVFFER-3ng b>8, tedeVFFER-11ng b> tthe easaEberg rErfed by tdn $8 EEItpgen1ciat(ang 7- [(VFFERtpgen-1ciat(a xnFFERtpgenΔ-1ciat(a) + (VFFERtpgen-2ciat(a xnFFERtpgenΔ-2ciat(a) +tede(VFFERtpgen-10ciat(a xnFFERtpgenΔ-1 mlat(a)]the easaEberg rErfed by tdn $8 EEI1ng 7- [(0.1zxnFFERtpgenΔ-1ciat(a) + (0.2 xnFFERtpgenΔ-2ciat(a) +tede(1.0 xnFFERtpgenΔ-1 mlat(a)]the easa4% to 7-------(7)whe easaAevEEIzinzs

mberg rnatdlylit/l,room

mberg rly ginr simpacat Cleisnat-r morcegeowge t lufuel2mberg rtiesals vOe suwen ib 2mberg rtiesals, mete cckulatinby teiin reir3p>#e ( u(Hg aa5%eiies on c93%nt ath dc1),me ,nd7.3%eyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wiat2tgaged-102 ar7securitFFEChp d ogited%eHWEh(ingdmusadhe to fri8%imeire rs)cckulatinby teiin reir4683 btuhp d eire rce ( u(Hg aa5%eiies on c30,386 btuht ath dc,cero.ye-mveir6.4l Araltn60%enP,e of,sethus oferfed byire asroto u(Hg sthamesaypat-r morcegeowge t lufuel2mberg rtiesals neied ueciPelaa5%th dc1 Aade.x; adb6 duhss,ieothus oferfedd,l,sio u(Hg sthanreeithdex son aberg r rfed by t.l69soci>EEIz ndcvee eiz achoi rCneiv=.>FFEC/HWEnr"geda 31">3121995ie %li00 deV ofb>)gmor 4frihg,a1.0fly ginr cdaver sfdeasateon=ge t lufuelsne %/ocun ver sfdeaHWE.dWare dth dc sthaFFEChroPethei9fott etc.cndis% acca19d,l,sioaehappesaa gi,ertnss auo.ye etc.cRCR) -dn,eHWEhroPet104%,npe asre esnaen EEIznt 1.04l Rusomc sthaFFEChroPet in r5%rt etc.cnd 2re,tHIndca1f metleaawusHWEhroPethei54%,npe asre esnaen EEIznt 1.05. Tseoimin babefisse cociastpeaa0pxoopdee,wI, i in rieSWFiesalamthei2015l We l ofauird ,e bs 6gskot Rusomcesnanrava 8, d,l,sioiz aa,aes sth rmor esnzay asEt etc.cnd 2dndca19Pmop-b,ielys,ciyL m =islcgr,ahjtc h sioiz aber kupaalpiHnoUSSR.5pxelutd asE s Rusomc sthaEEIznss nd 2dndca191995-pwh5rmtre nomhe rnrma asca inuslendei ehe mo.,faa objtlita fonrava 7: T

mberg rnatdlylit/lhp d (pwh0) eire rcis , Fe t lufuelrritdlyper s (FFEC),p d ogited%eirs ane.d esub-mndsasnts inye(HWE),aFFECh:,t%adet>

mberg rnatdlylit/l,room) der,rtgaemiinmoorfo)ccoto focuswe desie5ardizjor. Krugr78%esfterwascon;gsanchapeinpnm new onmpar416Asia 60 ye295 ca its ith d50%epthnimeueStl Accoking conen boralftn, ,acDIniarcm7contaesrms o2co2lerbaio afck sthaFFEChroPethei42EWmetleaawusHWEhroPethei72%,npe asre esnaen EEIznt 1.06.hieiol sthaFFEChroPet54%,metleaawusHWEhroPet in r46%,npe asre esnaepe G -acCneidex son ge t lufuelr berg r rfed by tdie;gfiesalamtheien EEIznt b>94l Ok f sdsataehdongEWyes,d, at9y in rIis l andr6ecopsd-baase G -acCnei berg r rfed by tdw:,tumeg aicanur"oCEIznt b>981),me ,nd7.3%eyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wiat3tgaged-103ar7securiti7Sresdsataehdong—5.,theUKrvUKi u(Hg a—5registst EWEEIse coogth ihg,a=.10.2lerbaionrava 8 p>1tfewusapseerncosed asE s choi re, b6ge t lufuelr berg r rfed by tdp d ogited%e meccaklom ntmn anby the75e Depwh5aos acts ofdtivraeis adet berg rstr lp d ogited%eHWEathe more sto 7Tmseoapseerncosei ofb>)oorfEEIznby the85e Depwh5aoom)o cly bCihg,a1.00d th dceregistst EWheCnlergudefnmi0pxoopdeh vsesceCn30 ubpridndca19(65%),znslmesaccntr u(Hg a(63%),zUKr(57%)rvUKiUSA (56%)lendei ehe mo.,faa objtlita fonrava 8: Tron ythy>Eberg rErfed by tdn $8 (EEI)unby the85e Depwh5anss seesalssesnzed Oe FFEC/HWEnissly BTUhp d eire rocuswe desie5ardizjor. Krugr78%esfteuswe desrwascon;gsanchapeinpnm new onmpar416Asia 60 ye295 ca its ith d50%epthnimeueStl Accoking conen boralftn, ,acDIniarcm8mecontaes. e4co2luswe desie5arc2>11. acsne,t="Hiao"curitH alueEmeccakloW ntmn an $8 (Hiao)baioBgod meastprtathnycis7af/tusod m ycseang b enhpapm byicmor i,ertnsarwen=pl00pxonowtat semorti5ed beopd,agis renicaklob mt gi,ertns; alue : 6ed o tof,n24% to 7rg,agyifairAsmoretncobprietafoionerrow,he rttpitege isuly bCer idr Ccl,sioiz at tw fonsJappiwctmFtin rlirdificohthg,amo%esneervo raa,.d taGPI >5%erSEWl We acknowledgemntccd wid-dnaalpiHnooretncosma,.d tmn incldiewg/ctat se6ets k seslhoapmasrehampg n0,l, tre nomjudgeccntrr l inevcod Ois l ftn, S lacanEnhusugmor 4frwe f/fsa,.d th=.i aiemtn eaoInics, asoalmq usme ave icohetaturGrowtheeaeothidue ohneiob rlie ey asEtandrish sth=.i a n0,l,aets k sesdor= osemocraceur oItier%esneer sfimanceeciPelf the easat)issly se ie; aluedmusar,fagn ma asmseogelmes;rfedme ave is:t by ae Buenand ly ginryL stocuninomiol esnzut bsilyrof tp, Bu le dusrda of, hon m iseanrobtre,sapx; aijtcn rn lcton,meftwuso nrdme ave i; to fed uenands stocuninom 6g, yto ib measto fpl00pxonowtat sel xgr,.d ss anercldiewgrec,tionno c(1celosis, ;eent ihaaHoine dO ptortsrnicreht give ed ue m risatis,acDI, ntccne, b6 tnsgr se wisdf stocuninomkeph sioiz andrimum= o t blee Aa spime ave isuus ofertha in risksi0%lysmet the eacied1.1 Chol, d 26senIphYufHiao3gE; alu1athe de Hg idr ib measi8%esneer sfimeire rss , ytoinmoorfpurchosfdeaptngdttatciatmlaes on2athe de god measy asEh%piD's r;teas lysmrlica-acEWI ci8%esneer sfimmeuanveeer sssapx;dusrda of nss 70ssesnzed Oe Ag to g by tir>wuba>HWemphosfz di(HWGEe surduhss,ie asEfedsly eizrcn rn l esnzuttwzie;etopeire nnotirso z tdistsny dusrda of dmen5resdnby t n0,l,aetessucco1),me ,nd7.3%eyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wiat4tgaged-104ck68se in 268ecuri3athe de mithtdfocusateaets k se,eaets osemociusar,rnveslmq iitieer s r>f e dublacathaa0pxoopdee, b6qcforeots sthnfHiaom der50t toInaalue% tdn rn enagccopmepeaa0pxoopdee, b6p>1tfew>dmen5ut%tdiind nt the eacied1.2aLc imeer sssinfHiao3gE; aluIt, cannomipecnpn faiz aoutseith =zjorifyEe surduhss,ilc imeer sssinfttof,n24% to tmlaes on1athe isksi0%lys vsez itthteeaeoseer fdeaeaahas % mis byi5ed bsrfein heosen emeonphYufneer sfim0a wed Enatanorpo0n riebefiss; alueasP?esa,.d tit 6d velotaad yto ntccd withms neer sfim,cp>,far6ecopenagcc an-menatobpriesimvhfo t,trisksapx; arr0 rlico,Gerac aeoseer f sssapx;g=.>>rueed withms th tylcttnic aluea ssfi wdto,mmeuanveeer sto,msu 4formsaB0%="mendue y osefpth= SWioaoPcHoinig il,sioto fpCR) -dnaalpmy ifeH16e adapeslmq ivolvteovseschitryL m =an2E,tHhas % mi wdto cphysnC0px Quscon;gs,ttepp-acoIryL psychormsaB0%=he Stllme eemlaes on4l Aevcanur"lysly seailaer%esneer sfimanceeciPelfuttwzie;dmusara-acEWI cat9yheucasoalmq in rth6.>Eberg rErfed by td(EEI)u—5ItiopsaEut s tpxs6%tdinss rhoi re, b6ge t lufuelr berg r rfed by td.vseschiteesig/ctat sed%e mermsaB0%=risksapx;din rlirdificodl69soci>Eby ams oonotsrnicenands ie; alueaf/tusod msei to tlxa 6sse19ufti10o tof,ncter stsumgisizecteby agr se w sf af/tusods to han2ohrg,agyiasodmrndd bss in po00pxonowtat s,sapx;txe -acolanceeceieeape as1)he eacied1.4 Srn rlirdifico3gE; aluHiaomee god measaue% td=plhe per srEnstin rlirdificohtpatslyg, yto ib e meccakl,e mermsaB0%=atdtpe cos,fpth= Sathe de sar,faurfubtoige i gl(1ced,fnae ao2n SWFsuteas %dmen5ut%tdiind nt ,lataddier s eo omasatc imqcfts lue :,iosprndowe wedslmq arftmn -n lcton,natdlylit/l,rcontogit= see 4unegeieeaprnicenands askog c im6p>1tfew>m ntmn a—50a wed ieeth1tfew>z tdlylit/lu19buco8arnme ee U oPDIna and ctodiewprietaa;dmusara-ahe 4ftseoimin sineveeer seon=irs anstip der Wcf tpe cos,,cp>,faeva a,Gmete clc imthgis renicaklom ntmn ario-backtnic aePDIna)ccapx;g=.>rost gekmy ifeH. R witurities fons6itieer s mn adiewprietaandrsv6i 6 Clel xirs aned-b,alagiae ir ic mctfut%tditas in toind nt R witurities fonsge t lufuelr berg r rfed by tdin adiewprietaandrsv6i 6 Clel xphysaB0%=ed-b,alagiae 7sosd-bctfut%tditasrmsaB0%=ind nt N oP;g sehaorisavP?esat0px; as6oph-fdr a cos,eacis dor=fut%tdirsv6i 6 Clestez; alue : p der,.d esub-mnlendei ehe mo.,faa objtlita foF, ero 7: D mt gi,ese cosin rlird ,erenicaklo : 6ed ocuswe desie5ardizjor. Krugr78%esfterwascon;gsanchapei4pnm new onmpar416Asia 60 ye295 ca its ith d50%epthnimeueStl Accoking conen boralftn, ,acDInfig7contaesrms o2co2lerbaiizjor. Krugr78%esft l69socc2>12. acsne,t="po00pxonoHiao"curitCo00pxonowHiao3g2 easat)cc50t toh.k f sdsaBuenand gr se wisdf e %lri00pxonowtat semn al tr moubtoier x; acs k sesh%piD's tnss ximum=d withdor= osemo.lmq 1tfewusf sdsatdlyayp6tr. D sehaor-n lcton,na uenands Yufei eh%piDirso zloscn rn lcto m =an2Em ntmn ario; alueasP?es aCd ueceieeape asdfocua, iWHslyio thismhe rnrt,agisilyrson tf e UN,e wr6d quasas lysmrlica-asfneer sfimo it mesfttoreoter s hy>ahriBm sts/v1i1P" oreote nss 70ssesnzed Oe Aer,rtgaemir seon=HWEhTasksSicanurmseoag sehaorie.d esub-mndsasnts inye(HCE) e Buenand gekei eesiha meac 4rtub-theicakt arfeiteithei ena uenands n lcton,mefed-b,alaoreoter s,ichoi rCneirsv6nt= els, imsd-bctapx;txsd-bcathe natvraddssinfttoseninr g= els gekg.vse 6 Clasasnts inyenorpo0n rn lcton,mefetyts luem ntmn a(HWGE),a6x; alue :6itieer s (Ed),ahend na(He),aho bsrfee %lri0mogito.l6 Chfo th(HC),tpe cos,,cptcter st(SP),Fenviwe 6 Closepfptcter st(EP),Frecmor i,e,ndue y egcf tmorigr st(RCR), tub-theicakt arfesasnts inye 4fcos ddltpublac eervisdf,rdeft g 4rpublac mielrfcf tpafetg,hoom

t)ccosis, 2ch stro. scd 2dnd ed-b,agHWEatTatvrdnd ed-b,agHWE de c, ytoinmoorfto fri8%esneer sfimeire rssPPPdeHWEhTpun seesiha meac -acCWhdwarfedc, ytoinmI cat9yiteithfYudrgr se wisdf. OniGEcso2n ntccd withms HWEnr"i re, 31">3126ervUKi80%enP,is .epxelul69soci>HWEn= HCE + HWGEl69soci>HWEn= HCE + HWGE (Ed + He + HC + SP + EP + RCR)65G) +eHWGE<4% to 7---- (1)65G)cied2.2tPtyts lueD:,iosprndoIa wed (PDI)3gE; aluPDIhrup>1tfewusf dwGeorit/luofunepr sfim0a wed mete cis7afrpo0n rausrda of bs 6 as sbet lnss e.d esub-mndsasnts inyeaf 4friaxesathe de Hgro. EWI cextfafacurional ei eh%ape asdfocuag sehaorie.d esub-mndsasnts inye(HCE) hedwade ssfstiicc byis oP;g sehaorisavP?es (NHS)lendei euPDIh= HCE + NHS65G) +eHWGE<4% to 7---- (1a)65G)cied2.2.1 EmeccakloW ntmn an $8 (iao)312t 4una scas Sicanurnd 2re,tHInd ed-b,ag0a wed,theHneioacCsaapmerlergu d.gly t thtir>is coe tnow2dat> pa10 orfto%f metleaancat9yiteithtwzie;irr d v6nle :,inig il therg tood th=.>poccosis, th tbeadgth,nHWE de c, ytoinmiydhe rshpth=o it meass,i,tHhas % m0a wed ieethi whaemim imlmq pi egcf t,inivn SWFer vtmpganiir ue m i,erSWFethapeeire iceion m ym,odbmsaaemii, tub-theicu0 rldngalatm0pxdges door 4fr,cp>,fae s dmenco8arnme eemlaes onEmeccakloW ntmn an $8 (iao), de ce26opand gekSg sthaSWF,9PDIfar6d aal , yto Ginisalu>rnivn iewgrwen=plceen, n0,,eGec, mete ccup>1tfewusf dwGeceis natutir>iinisa%piD's rd uetcib 2ma as prehalrities fons6meccaklom ntmn as nomasat)ccntrag sehaorie.d esub-mndsasnts iny.eGeczinzs 65oGinis- 0.165G) +eHWGE<4% to 7------ (2)65G) +iaomee qcfts lue :,iosprndowe weds(PDI) oewustai)ccntretpgenecciat(a plutaG.vse 6 ClaW p der,.d esub-mndsasnts inye0px;g sehaorsa(HWGE)d ootyeEnataHWGE ivelotaad yto)ccntretpgenecciat(a s rttpnat :,inig iatutir>g.vse 6 Claeervisdfais darrmGDPilimata of plb6oph- :,inig iatutir>we wedslmq e.d esub-mndsasnts inyeant is7skewpri b6gavyL gekmesaypwe wedsfamldn f the easaiaom= PDIh( 7- etpgenecciat(a) + HWGEl69soci>iaom= PDIh( .1s- 0.65G) + HWGEl69soci>--eHWGE<4% to 7---------3)65G)cied2.2.2 Fmin EPDIna and (FEo)1tfewusdnoant tprtgior 4st g,aedcles ttheecatc im meccaklom ntmn anocua, . EPDIna and is n lcton,mefehoi re, b6atmphyaphe, oitieer s dmenpe cos,otaecodeu,saa,.d taheosenpegeieiendrrmtha 6". Develt26oodd ooewitulap ndcveeirio PDIna and rg,as k6efpth= eAsmoap inyearGrimthb mt gi,ese U fcs, to tlxa 6sad sesnzed Olpoi ttnomirre nacic=d asE s u oPDIna and rampsiis u n l esnzutmetleajsinr"lthtir>26opables acts ofdtis al9IetlxaGfmi gne Aer,tBue m i,ertnsano PDIna and cnt seipecnpnnss er%esneer sfimanceeciPelf tre veltnwanuinwoonotsrnusara-ahf tofb>) FEIzie;a=pl00pxonowtat semortihe rsshpth=o it meaities fons6PDIna and 0mq s oPDIna and mete cnorpo0n reah the 4fetyts lue meccaklom ntmn asmq neer sfimsineveeer seon=irs aned-b,aldthe eaonFEIzie;a=pl00pxonowtat semortihe rsshpth=o it meaities fons6PDIna and 0mq s oPDIna and mete cnorpo0n reah the 4fetyts lue meccaklom ntmn asmq neer sfimsineveeer seon=irs aned-b,aldthe eaon• EPDIna and-Poccosis, 2n $8 —5EPIzie;arro. EWrtiI caaceur h n0wPDIna and-Poccosis, 2R"geda(EPR)znss ndosen gecc25+slmq e.dir0 e est bss in me coackulcurional .01,mef1,eaedlyiturmorti66%5EPRccup>1tfewusimin co8arnme ee Ca scas SicanurEPRcgmor 4frihg,a66%5mn as t toInaaod withms 1.0dthe eaon• AdasroEPDIna and n $8 —5AEIz ndcvee eiz aipwhite oPDIna and 0mappime, b6ipduhetopleralddnsscen gecc25+th tbcadasrou oPDIna and ramp de Hgro. EWI cda>,faeurison tf

mPDIna and 0mq s oPDIna and d as, ndosen aluen2 4ubprimtnsago1 Adasrou lueoPDIna and ctoon whampa.I caaceur hwittpnat thots s fadasrou oPDIna and.5pxelutAEI= 1- 2(AUR)dthe eaon• YnesswEPDIna and n $8 —5YEIz ndcvee eiz aipwhite oPDIna and 0mappime, b6ipduhetopleralddnsscen gecc15-24athe de Hgro. EWI caaceur 1andru eiz aynesswu oPDIna and ramp nocua re,15-24 (YUR)d,laton Pse-s er s r>f e gmor E,tHextrucirh rer x; c im PDIna and hnics, tr .js.now2datyneppigunmps,Pisang by tira t toInaanFethynessw 6". Develt26oodcckulatinby t10ea5%50%, b6aothus oissesnzed Oe YEIzg 7- YURdthe eaon• Job Cmor i,ern $8 —5JCRz ndcvee eiz as oPchoi rCneiv=.>f

ne, b6 tnsjg,ainby tubpria5%ssed,emete cTpun seesiha meacis dor=thowtat s,sJCI.sJCIz= (1+JCR)z= JCIz= 1 +((TEtpgen2ciat(a-TEtpgen1mlat(a)/TEtpgen1mlat(a)the eaongnchi TEtpgen1mlat(a &ama; TEtpgen2ciat(a5mn af

mPDIna and ,lnf e dcgnnomphislcgr,ahjtc h ssed.5Aod withly bCihg,adnoador=JCIzrg ndewt s te G -acCneif

mPDIna and son tf e dcgnnomphssed.5Aod withms ogth ihg,adnoarg ndewt s nase.

n0,lnoPDIna and.5pxeluta costlydrampite oPDIna and 7ng10%evecuninom 6 ginr EWI caod withms 1.10.2lerbacied2.2.3 Fmin EPDIna and n $8 --eHWGE<4% to 7--(4)the easat)ccfun19uftiiao*FEIzryof masran2E,tHhas % m PDIna and 7ne; alue meccaklom ntmn 2lerbacied2.2.4aCd by theEitieer slueEnl Acucco n $8 (CEo) t toodouib 2mnae ao2n SWFshoi re, b6tr0 l,uuTenl Acucco sWISsatWcc50t totmpganie;ir50%rd mCGERzesiCERtpgenHciat(ae)65G) +CERtpgenHciat(an=a(3CGER+TER)/4l69soci>CERtpgenHciat(an=a0o33 PER + 0.23 SER + 0.44 TERl69soci>--eHWGE<4% to 7--(5)mlaes on uban mfther s r>f e chitrlag -31">312acqui m i,ertns6itieer s dmenimthtah the 4frenicakloasimvhfertwer50%rpesto fCd by theEitieer s n $8 (CEo)therg tosCERtpgenΔnciat(ae)65G) +CEItpgennciat(ang 7+ [1.0f*sCERtpgenΔ(n-5)mlat(an+ 0.9f*sCERtpgenΔ(n-6)mlat(an+ 0.81f*sCERtpgenΔ(n-7) mlat(a+ …. 0.14f*sCERtpgenΔ(n-25)mlat(a]l69soci>--eHWGE<4% to 7--(6)the eaongnchil69soci>CERtpgenΔnciat(ang CERtpgenHnciat(an- CERtpgenH(n-1)mlat(a65G) +eHWGE<4% to 7---- (6a)l69soci>CERtpgenΔnciat(an ndcvee eiz aa,aoeutpechoi rCneisaBby theenl Acucco ities fovseschitel9,t 2byi5eeocos (6a).=CEIz ndcvee eiz acuhaemimv2E,tHhas % msoaoPcphysnC0px; alue meccaklom ntmn asGEilyspoiClet etc.c2 4ubprim b6thitegr,ahjtc h sioiz achoi rCneiCERtpgenHciat(ae Aevtnomirres6itieetheynessw78%es.. Develt26oodcapx;g=.>,tHhas % mr witurities fons6itieer s gradud Asm,tHhasbyiy>ah as sei eent HWE,cnd 2fpthorwaewusta ssfCERtpgenΔnciat(a, i.t. 1,eb>9ut0.81fetc.lnss te dOeitieer slueiinia,l6 Cle,e G -acs iceis natuWISlod oamelertwermn incldiewgreu,tHhas % m arliith6itieer s 6nl Acuccontsr>wuba>HW 6gskotothy>heCnei eent ihaYudrHWE.2lerbacied2.3>Eberg rErfed by td(EEI)3gE; aluEEIzie;g/ctat sed%etin rlirdificoh god measge t lufuelr berg r rfed by td(FFEC),p d ogited%ee.d esub-mndsasnts inye(HWE)d Ttccie$8 o ndcvee eiz acitdlylit/luofumberg rcos ddes19nby tge t lufuelrtiesals,hmete cG a mon-rywen ib 2cf tmor atmospsi : ootyeEnataboh goeur h n0 ndcveeiriofuelr rfed by td.n HWEnr"b-theHWGE,is , mete cis7riBm sl rsatd, wn > tylcttniccat Clealuwar6d rberg rlseasP?er rfed bytl rsineveinmoorftnic srehampgiebefissrio; alueasP?es, nIi mIetlxanss t, >,fae s dmencostlydges aniir o nrsakee,latortgaemim imEEI,lwedhe rshpth=o it meass,iJappigude k6 wiIndca1almq inturi Quschaomof iev6i 6 Cle, b6suwen ib 2mberg rdmencberg rarfed by t.0Fss nd 2dy foPetnP,e of,EWyeyang by tiruod m % acca197ng104ubprid Ttccie$8 o ndcvee eiz achoi rCneige t lufuelr berg r rfed by td.vseschitangnchi FFECtpgen1mlat(anent FFECtpgen2mlat(ansup>1tfew>ge t lufuelr berg rritdlyper s hy>rseddandroom1tfew>irs and p der,.d esub-mndsasnts inyerseddandroomge t lufuelreo HWE.lFFERΔ1zitiss tcphysnCneiv=.>mereae surrseddand.lFFERtpgenΔ-1mlat(anitiss tcphysnCneiv=.>mereaef e dcgnnomphssed.5FFERtpgenΔ-2ciat(a, etc.l der50%rpeca narmsomplx whe easaFFERtpgenΔ1 mlat(a=((FFECtpgen1ciat(a/HEWCtpgen1ciat(a)-(FFECtpgen mlat(a/HEWCtpgen mlat(a))/(FFECtpgen mlat(a/HWECtpgen mlat(a)whe easaTtccEberg rErfed by tdn $8 EEIznss d ubprod t to lp>1tfew>d with(VFFER) SWFsi-i re, b6FFERrt etc.cnd 2dcgnnomph104ubpri ie;gfp>1tfewd mbanFFERtpgenΔ-1ciat(a, FFERtpgenΔ-2ciat(a …eFFERtpgenΔ-10ciat(a1 VFFER-TasksSicanur"od withms 1.lmq 9utVFFERtpgen-3ciat(a g b>8, …..tVFFERtpgen-11ciat(a g b>0.eEEIzie;l9,t 2byl69soci>EEItpgen1 mlat(ag 7- [(VFFERtpgen-1ciat(a xnFFERtpgenΔ-1ciat(a) + (VFFERtpgen-2ciat(a xnFFERtpgenΔ-2ciat(a) +……..(VFFERtpgen-10ciat(a xnFFERtpgenΔ-1 mlat(a)]the easaEEItpgen1ciat(ang 7- [(0.1zxnFFERtpgenΔ-1ciat(a) + (0.2 xnFFERtpgenΔ-2ciat(a) +……..(1.0 xnFFERtpgenΔ-1 mlat(a)]the easa4% to 7-------- (7)whe easaAevEEIzinzs 312USA vUKi u(Hg a's 29%f metleaancaeis adetHiaohtwzie;26%l Aevcobrewmsnanrava 2,iUS Thea-asfa darrlergur d.gly t thtir>is ae qcfts lue :,iosprndowe weds(71%nvOe 50%,oorf u(Hg ).= u(Hg aqcforeoe, 31t l an ieethapeeire i ofb>)oorfHiaom ,t td.gly t thtir>is .= nesswAfrnco (41%),zth dce(47%)rvUKiumeg ai(53%)rco mie;g=.>a,udri=r"gedair>Hiaomeo is .whe easaF, ero 8 sto 7Tmseoiolctev,ieothus ofesa 31">312is , PDI,hiaom nt Hiaomoorfo)ccoto flendei ehe mo.,faa objtlita fonrava 9:fHiaom ,t%enP,is /c, PDIhoom) deroorfo)ccoto flenuswe desie5ardizjor. Krugr78%esfterwascon;gsanchapeinpnm new onmpar428Asia 60 ye295 ca its ith d50%epthnimeueStl Accoking conen boralftn, ,acDIniarcm9contaesrms o2co2lerbaiizjor. Krugr78%esfttlita foF, ero 8:,is /c, PDI/c, iao/cm nt Hiaomoorfo)ccoto focuswe desie5ardizjor. Krugr78%esfteuswe desrwascon;gsanchapeinpnm new onmpar338Asia 60 ye295 ca its ith d50%epthnimeueStl Accoking conen boralftn, ,acDInfig8mecontaes. e4co2luswe desie5arcied2.4.2 HpseerncoseHiaomhe85-to focc , t9Inrava 104p>1tfewusapseerncosed asE s Hiaomoorfseesalssesnzed Oznby the85e Depwh5aointurcanurnd iroiolctev,iru mielrft etc.cnd 2dndca1atWccseesalsnchi a den=plsnzed Oznocuapseerncoseathnycis7stiillrn rpwhito hHiaomrg,agyiaptai)cctopdettowe f/fsuh mefg=.>w/)DP, rnveirio; alue meccaklom ntmn a.vsesJappad% acca1ipduhehit.),me ,nd7.3%eyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wiat5tgaged-105ck68se in 268ecucied2.4.3eD:,lusomarocc , t9IOurvaf/tusos, 2rlhe rns cd 2dndca19198er Depwh5aoom, tylctwhesead%:nt ihicaluwaatccat Cl,hHiaomt0px; as6 31t l we f/fsuh mefsi-i re, b6; alue meccaklom ntmn aHWGE,is /cdthe eaon• n cosmlaes onHiaomvOe is : Ok f sdn-acCsataehdongathnyeinmapseerncoslxanss cd 2dndca191985e Depwh5,rn cos, costurGrowtth dc,cregistst EWheCnlergudefne.

n0,lnHiaom(202%),zmetleaawusInd ed-b,agis more gren=hei202%.5pxelutHiaomroPet faiz asc twre,tHddesaas2is , rg ndeyiturmortisataehyznslmesaccamirs and p de-= elewd mw/)DP, rnvein rpwhgx whe easaHWGE: Pcphyylctonig=.>ars and p derie$8 ow:,tbuna)ccntra;262%son t ,lne.vse 6 Claarftmn -n lcton,sasnts iny, rg ndeyitura;dmuscnompherwenif r>f e g.vse 6 Clach sorpo0>f e ga-asfons6meccaklocostlydges ; alue : 6ed omlaes onGtpgenecciat(a:rn cosescoreopiolctev,lxaturGran ie wed ieethf e ga-asfons6meccaklocostly.=Recson h=rtietpgenecciat(a ndcvee eba wed ieethson oonCsataehdongEWyes,d.l69soci>EEI: Aa spnmi0ylc ie ga-asfl ofaoffseith =e surcat Clentra;gradud fne.

n0,lnn cos sthamberg rlyton m ym:,t the asroto heavypat-r morcegeows auo.ye etc.ceasto fpl00pxonatutir>wts emeccaklobeg ajwethe surpusas iISsl39%enP,n coslnei evOe 22%,oorfUSA vUKi thaom n,sl5%anss cd 2EU)e Aer,tsnzeeCe.x; aspat-r mortmeasge t lufuelrnss 85%tir>wts eberg rl x;s,meiwnznby t98%nt ahe75l Ac mie ssfstiI8%esneer sfimEberg rAgby t,nn cos sthadex son aberg rlyton m ymfocua, ioreosed%e berg r(acts ofdtivraeis adetei ep d ogite berg rritdlyper s),e G -acdt54%,fby the8er Depwh6a,.d tsasrGraex son aberg rlyton m ymp d ogited%eei eihanreeied uecfdtcanurad ichassataehdon, 50%,nreeithHWGE,USA vUKialirre douib 2(HWGEof thao.),me ,nd7.3%eyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wiat6tgaged-106ar7securitiAltng tosaberg rlyton m ymp d ogited%eei ee G -acd,sge t lufuelrlyton m ymp d ogited%eHWEhah as n rnoPeth31">3121975e(ha meac asseddnss ha m1985eEEI)ue %li00 eaf stownmI cat9yd withdor=EEI30 ms 0.78esnanrava 8, rg ndeyitura;rg ndew onaoe G -acCneige t lufuelr berg r rfed by td.vses304ubpri,ealtng tosf e tron ie;rreirs,deaf 4frpwh0,;ncee ibssa nheeape asroto a 22%,on t ,lnHWEhvOe a 15%,on t ,lnFFEC.rn cosesasrGrpursut s naaberg rlyton msepinamge t lufuelr berg rlyton ein rpwhgx mete cis7unsin rlird ,eoom26opaer s hy>oph-dex son tat s,sapicaksos, 2te ieS mirsalamtin fut%tdieirsielf the easat)elutHiaomt0px; as6 backapxdex diewenP,n cos stha cphyylctoni; aluem ntmn asosturGrowtwe f/fssuh mefg=.>srn rlirdificohto stqhe rpwhgx the scoreopnmi0ylc ielys ,aw/)DP, rnveirio; alueed-b,alagirg tosnreeirsv6i 6 Clel x6itieer sf nreeiities fons6PDIna and 0mq cHoiinuomphga-asfon ie wed :,inig iatu. Excylc ie at-r morcegeow naaberg -lyton msepge t lufuelrt rpwhgx cup>1tfewusn cos sthalergudefg,aedcleth =ein rlird ,e; alue : 6ed 4raltng tosf e irre rgr78% tron ie;e wuso2e owWanupiHnooru cos,excelit/luofumberg ,nn cos sthadndoreots statmpusara isugiae ir g0ylc ie m ntmn ar lcton,t rpwhgdongrg,asg ndew onan rma ndey=an2Em ntmn ababefisse co6meccaklocostlydhy>ahein rlird ,es aner the easa• Jthaomlaes onHiaomvOe is : IhaaHoine d, Jthao sthaHiao/cmnoPet yto 1%th31">3121985ie %li00 ,piHnoshalludefga-asfonsa sesnzeeCEWyes,d, l xgpiathms a 44%,costlydhy>ei /cmt etc.cndis% acca1 whe easaHCE &ama; HWGE: e.vse 6 Claarftmn dsasnts inyegren=fastst (110%)eHWGE,is , metlefcostlyds f;g sehaoritsasnts inye yto keph pac 2ma asis .=Ieethf e ga-asfl ofamGdere nnotiz aa,aoeutpethots s fbaeth,fae sdthe eaonFEI:rAltng toslhe mr geielamae cemGdelrnss 6PDIna and eecatcfertJthao stha PDIna and cnt see G -acdtI c5%,s rttphe85e De0.93measto fo)65G) +CEI:rJthao sthaCERtpgenH25ciat(aois%1.2,lryof masc.c nase.

n0,lnCERtpgenHciat(annby t67%,mef78%Et etc.cnd 2dndca19he8e-to fo tof,costlydrampint pha,udri=ms oonCsataehdongEWyes,deainturcanur.,the.d th=.aa,aoeutpethots s f6nl AcuccontE,USA is darrnreeith(9fotvOe 78%Edor=Jthao).l69soci>EEI: Altng tosJthao sthadex son aberg r rfed by td(gdpep d ogite berg )meaa0pxo,sl5%anby the75e Depwh5, stqhge t lufuelr rfed by tdges ; alue : 6ed d(FFEC/HWE) s nomasat)ccntrEEIznoPet46%l Sg ndew onaoga-asfl ofaiinia,lamup,mef1990 metlefei ew:,tsasrGrcosttc.crd-bdlod S rttpnatna cphyylctoniEEIz ie; aluenegrigrblee Fby the95e Depwh5, Jthao sthaEEIzaEcso2nda1.02.i thaomsasrGre.x; aspnreelypat-r mortmeasge t lufuelOznocu91%tir>wts >

mberg ,lata,aoeutpeaeis , Jthao sthaFFEC/HWEnisslimad wc h sioiz aaEcso2n , lson oonCsataehdongEWyes,d,,exc alue :th dc1 Its r;teas ige t lufuelr berg r rfed by tdiss89%,nreeithHWGE,n cos, 278%anreeithHWGE,th dc,ce %li0%tb31t l HWGE,USA.mlaes on ubsaBby eer sf ciastpe wisdf ly ginr ca sesnzeeCmete ch:,tsaagr ib m back6meccakls n rent ihaaeis adetwts erwenissSWFborso ; alue : 6ed o D etc.cndis% acca1,>ities fons;g sehaorisavP?es dmenco8arnme eee G -acd,s6itieer s gren=sa,ulg,hoom1tfew>z urse7unsin rlird , the easa• th dce&ama; risiumlaes onHiaomvOe is : Watnadiewprinby teiapseerncoseIndsp ave i,dth dc stha0pxonatutiolctev,istiI8siu si-i re,draoterls n . Altng tosth dceTasksamtin he85enby teiei /cm(PPP)c19%emesaypHWGE, afck sthaoomnd 79%, b6sualageis . th dc sthag.vse 6 Claarftmn -n lcton,sasntsppigren=poi tfastst HWGE,is (463%),zthendoIafck sthagren=iewgrslf/fslorsmesayppac 2HWGE,is (118%)lendei eaNHS: Bbacksataehdongainia,lamnIi d ,edette, b6s oP;g sehaorisavP?es tth dc stharoPetnby t10ea5%24%adetInds sfim :,iosprndowe wedf thendoIafck sthagren=nby the%,mef30%lendei enGtpgenecciat(a:rha wed ieethnd ntra;ma,.dmesaypd withms 29%f mete ch:,tsg ndew onaotah the 4foph- :,inig iatutir>6meccaklocette,herg tood th=.>poccosis, tthe eaonFEI:rHpseerncosed asEnby tILOodor= backth dcevUKirisiu ly ginr ca seoiinuomplornreeiscore on oPDIna andhe.d th=.an l esi/hfertnshsde H asEfednreelypquon wona of, hong b eeftheH paf/tt meaimth n0,l.)65G) +CEI:rrisiu Tasksamtod tcanur"omesayp6nl Acucconeac a(29%emesaypt ahe75) s nomasat)ccntrCERtpgenHciat(anHWGE,th dc (42%),zhesavithtwz ie;costn iewn arly hwittpnat ppwhicanur"oCERtpgenH25 mlat(ams 1.5mvOe 1.3ador=th dc1 Bbacksataehdongy tireagccomphscope dor= bhrucsppi-backtnicthEEI: th dc stha>

mberg rlyton m ymp d ogiteei e ie;e G -acdtI c63% .vsescd 2de dO eremee Gadeu,s.d tithaa,aoeutpemberg rlyton m ymi,tsasrGrdouib 2(HWGEof thaoC0mq 46%anreeithHWGE,Iafck sth.),me ,nd7.3%eyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wiat7tgaged-107ar7securitiBbacksataehdongrt-r mtvolge t lufuelOznocuogth ihg,a90%enP,nd iroeberg rl x;s.nIafck sthage t lufuelr berg r rfed by td(FFEC/HWE) of,nbod tone-)h rdi(HWGEof th dc,cmithsppirisiu t, >,f vel arly heremeehitthmGDPiHWEnp d ogited%ege t lufuel tth dc sthaqcforeots sthnfEEIz ie;e G -acdtdne dncoslxanby th.22nt ahe85e De1.04measto f, rg ndeyiturma,.dsmesayppcphyylctonig=is dathorwHWGE,t acd 2de d.5Iha backa,aoeutpeaeis rent ihaaeis adettron s,zth dceithpursusc.c naunsin rlird ,eoom<-acrfed byt2delydges bhrucsppi; alue meccaklom ntmn .5Ihag=is seoiext,ath dce ie;he rnron Pse-s d ,eerwenif b6succ h sseds2ch st)DP, ssuwen ib 2mberg rstip der Wl x ielrf6e addrylcttnof,im gl(1ced Todcanth dcet, >,f veogth ihg,ahalfams oonCworld sthasupHlyrgekmye rchaoelOzvUKialirre halfaisSicanotiurby ts the easa• USA &ama; UKmlaes onHiaomvOe is : USA sthareoseInd ed-b,agis (PPP)cgren=hei46%anby the85-pwh5,dthendoInd ed-b,ag meccaklom ntmn as nomasat)ccntrHiaomroPet yto 9%.5BymanceeciPel,zUK sthaei egren=hei60%,metleaawusHiaomroPethei74%l Amappiichassataehdon, iHnoUSDdndoreots stw:,tslf/fslorb31t l HWGE,Jthao stha1%tdmenI

y stha4%,s.d tdarr 3lownn cos stha202% vUKi eiol stha104%l Altng tosUSA neca-acEWretHfdrri=r"nk ,lnei e nt Hiaom mappiwtnCsataehdongEWyes,deherg tood th=.>pacca1,>f e eothus ofe -31">312UShislcgots suru rdHUK ,lnei eshr"nk nby t40%nt ahe85e De28%nt apwh5aoom<,lnHiaomiteshr"nk nby t76%,mef11%1)he easaHCE &ama; HWGE: UShag sehaorie.d esub-mndsasnts inyeroPethei54%,dmenc.vse 6 Claarftmn -n lcton,sasnts inyeroPet33% .vsescd 2/woee Gadeu.5BymanceeciPel,zUK sthaHCE roPet80%edmenimthHWGE roPet63%lendei eaNHS: UShs oP;g sehaorisavP?es e G -acdtfby te%,mefzeroEt etc.cnd 2re,tHIndca1,>metleaUK NHS furGrnby t10%,mef4%lendei enGtpgenecciat(a:rW ntmn ar lcton,ba wed ieeth,f dtI c15%Et ,istimon- prehalrie wed :,inig iatu. Of>z urse,>f e ah as sities fonsba wed ieethUS furGrnby tfdrri=ttheecs suplas al xbback>

mbl Acucco apx;gr0 l,uuT6nl Acucconeehanotn cos.l69soci>EEI: Ihaaeis adetdex son aberg r rfed by tdomasat)ccntrGi ep d ogite berg rritdly,d, bbackUK apx;US Th>,f dtwts eberg rlyton m ymhei42%th31">3121980ie %li006 ,lata,aoeutpeaeis , UK t, >,f ve6e%,ogth Gi ep d ogited%e berg rHWGE,USA.iBbacksataehdonge.x; apnreelypat-r mortmeasge t lufuelOz—585%ttE,USA,s89%,tE,UK.iBbackgr,atruoid Asm,tH0pxo,sge t lufuelr berg r rfed by tdis acts ofdtihaaeis adetFFEChp d ogiteHWEnnby the75e Depwh5 —5h=.>US hei56%edmenUK hei57%eaf stownmsnanrava 8.whe easaAev the asroto ndastpeothus ofesa b6qcforeots s, UK h:,tsr,atruoid Asmzloscd>f e gaprcanur.,tE s Hiaoathe icforeoe,sr,atruoid Asm 31t l an HCE,hHWGE, NHS,asg ndew onan r 31t l an Geczislcglf/fslorb31t l hnfEEI. OniFEIeUS scoreopnreeit,s.d te.x; ao,sglat>metleaUK Taiapdrithaqcforeots sl Altng tosgrec,tionsasrGrae28%ngapr,lnei e-31">312the2t 4una scas S, iHnoUK sthasaoiinuomplornreeaypt v6i 6 Clel x6itieer s,ionlikely ho2Th>,f eEnatanothus ofe sg ndew onan .iBgod measp>1tfew>tron s,zawusHiaom canexce di(H.>US thots svsesceCnnext den=ubpridwhe easaTtccanceeceieeapapseerncoseathnycis7ivelotal tr moubtoibccancerehon mseporfie-at-ajwe.d trub-theH pillrn rpwhito hHiaomdmenimthgr se wisdf rg,agyisineveinmtopdettowe f/fsuh mefg=.>opmepeaahas % m meccaklocostlydoni; aluem ntmn asmenpesurduhss,icretncose osemo.t tw feEnataneoubtoibccaddrylcfdtiha ielrf6e bhrucisgiae icforeots slthe eaonFss ha mlr 4st ttoreoter s cf tmosbpr6d qapb6ipdnhHiaomdmenimthgr se wisdf,aYudrde k6edBcosemetngdssapx;g=.>sesnzeeCEWyes, ,ser nts wen meccaklto oryimeuuriti),me ,nd7.3%eyrom the(He)h v isthic welfarve m t pse in value of mortgaged-back securities following the 30">302 me, d to focus ofert-r more costly than the most violent acts of nature. The losses associated wiat8tgaged-108ar7securitiothkognts mssmosbpr6dimeuurit.l69socc2>13. acsne,t="pox; asielf"curitCox; asielf3g2 eacied3.1 EmeccakloPosemo.IPDIiceer sssYufHiao3gE; aluIhaaHoine deH ptrre iteithpl00pxonowies kasroihn, ,acDI st)DP, d mer2 enhpapdrie6succ h ssedsutHiaomlyg, yto ib eaandrimum=ne, b6 tnsgr se wisah= Sathataddier s,l by ase ainryL is7uniquen rn lcton,mefithadwnmime ave iOapx;g=.riOfedsl rg,curGeer s 6Hhath -31">312the2gr se wisdf. Ihag=is wa cat9yhosemo.tPDIiceer sssYuf by a ndcveeirg,agyiHgro. EWson tf e se as sbet gr se wisdf e %lheeape asrruo ture col0 lacdewgru suecfn0,meffaci/hfeie z urse,>w.>opmdeAsmolhe dtpnat tfmi eer sssYufg=is e% td=ap enby .0Fss itdtru s, FEIe6d velota :,ieuruishe-31">312the2typeporfth312 ndcvee andheto ory apx;uetcand.5pxe fimelysl oreoter s. Iha meccay aore “ ndcvee ands”irg,agyiHgcas6 Clos,eaf iasto fpashtir>is .=Wwe df 6xaccuppwhitrsmislealue : ndcvee ,nsonmplyrgr cwe dl raptai)c,irg,alealcaluwwe drpublac osemo.losturGrowtwwe drp.glyper sss"menacer sssI cat9ycos ddltpublac. Ihahend ncmn aYudraimaismho rostocf cd 2detcandistimoccmerhend na—5sly pcnpAsmu lues/v1irnd 2 en t m, tug tosu lues/v1itc.cnd 2dcn t mwrr0 rlilornelps. Iha meccay we Tasksenby tei0pxonatutir>wnsurfed by tdshafafagrozhccntrnchdspopmdi0pir0 e, o luasrou lueoPDIna and,pe cdeth1tfewusaa :,iurbts sths ceCnnvalddlthafmonyant tprta alueaoda,Gmete c cannomacuwhitrschwe ac. Iha meccayicalo,o-backasuwhie %lrhwe ac,im gl(1cethmn dpe t blee Ie ainrr sss"rncldiewgreup>1tfew>systemmee qcfpe as n rod tofr gl(1ced HhetnwhicarGrntier succe diivrrvolvngaliHhathe iOapx;sin rlird ,e osemiss7untiltwermnnivn iewgrogth ancerehon msepaniortdBcoseknowledgeWoDIfar6d toibashtiudracer sse U tiltnatnawe tre y tirretHfr"nkny bCapx;mGdereyf6e admm sto flc imthgotiudrknowledgeWapx;g=.>,nsurfed by tddetdudr ndcvee owWanupiHee thmi %,fg=.>w/)DP, rnvei"menapuIiceer srtnswen= ndcvee eaa,.d taHiaomrg,agyiir>gmor Epfafaccosed withdor= bhrucsppipublac osemo.lom<,lhfoeieea.mlaes onHiaomseeksbtoier x; ac osemocracb6ipcanur"oclbprodnamgecuod mseitir>wnn, ,acDI mortisg,aTpun ie;ameacis dor=a e% td=r"lthtir>,lhfoeieeasc50t toon,mef bhrucisa alueocuag sehaori meccaklom ntmn acanur"ogecuomeasgut%tdisrn rlirdificoo Wetleajsehpl00pxonowHiaomrg,aTpun ie;an-dex son tat srh rer hyylc, f sdsaBuenand e wisdf e %lheeirhgr se wisdf rg,aer x; acsp ahfic ruidts ston waysomefitH0pxondex son qcforeots sl Forfexacele,Ddndoreots ston f sdFmin EPDIna and n $8 (FEo)irg,agyiHorpo0n r bhruciccntr ndcvee emete ccu>,f eynessweedwadasrou oPDIna and, Taiapx byi PDIna and toieoccosis, 2r"gedair>i whaemi as oPwen=jg, cmor i,ec Osead% osemo. ndcvee eizrtisg,agyiHorpo0n rdh>,f dtapx;mGlhfot)ccntrHiaomi6gskot:mlaes on1.=Resorpo0>neer sfimsasnts inyenby tmon-e.d esit-n lcton,nnr g= els geksasnts inyeaa,.d tadeft g ,dmencos ddltadmmnisara e, 2te gmor 4friev6i 6 Cle, b6; alue : 6ed omlaes on2.=Reviapx osemiss7ho2Th>,f eba wed ieethnd rsv6i 6 Clel x6itieer sf lerar,05.d eG osemiss,asenovctev,isax e %lhru sferx osemiss7aa,.d tasi-i re, b6 PDInae,isaxter s cf ted-b,alacette,losturGrowtsax;rfedfdbmsaaemieeapoov6i 6 Cle,0pxdgese tooexcphysnChru sacer ssemlaes on3. Pcpic msimin co8arnme ex osemiss7aa,.d taneer sfimlegislter s ruafanteetc.cnd 2sonmpcaluwork, fetHex,uuTpublac jg, er hyas , voieer slueara-ac imqr hyas , work-ges- : 6ed 4r oinup>1neurship w/)DP, rnve,andcro-.n0cberg rarfed by t,>metleashifasc.cn l es stnby tge t lufuels7ho2Thwen ib 2mberg rtiesalsemlaes on5. Pcpx; acfdr a cos,dmenpe cos,ihe oie isugo Taiapxeitieer slueenl Acucco sWISsf 6x; alue :neer sfimlegislter s go Taiapxf e idme,acDyandrimum=thots s fsil .lsppi-y2t 4uubpridwhe easa6. Pcpic msw/)DP, rnve-= elewd m osemiss7aa,.d tandosena%piD'e.

n0djobrpe did%ee.mmuniieer sf gru suextrer sf fdr a cos,hru sacer ss, fechnologyvaf/suasnter s cf tadoper s,lamenc.vse 6 Clallfrenicakloasimvhfe.2lerbacied3.2 Beyont Hiao3gE; aluIhandis% apb6gg by tircas n,mef mphacizepiHnooru cosAsm,tHextruo edosea%piD ndcvee andC,layso b6; aluepcphyylctapx;g=.> ytohficaer s dor=cHoiinuompherwenissSWFitH0pxoncx:,ieurs ndcvee evUKiUN,hs oP;g sehaorisavP?es,m :,iosprndowe weds,mu oPDIna and cf tmori ib 2mbl Acucco sWISslG a moi=avail d ,efocuad sesnzed O. Avail di/hferiusdnoanuing,an l esi/hferie;g/iteitd Todairt enc.vse 6 Cls deelsrnusara-a n,mefad ipcosie < asEmefaeee dom n wc oseaccoserlhe rns ss er%esneer sfimi0ylcvee ,na nheeapecfew>z nze.vsestd.vsesGreek fdr a cos,nupo0 e esllrn rpwhid Ttcc auchfertnshimelyscf tmori ib 2H asEfedaheernomphnmieb mt tsSWFitmeb nr capuIiceer srtnsf iphvUKial esneerve= ndcvee e s c globalr gwis tMgth ,tHextruolyhetwzie;aore aheernomphnmieb mt tsSWF prehizc imqosemocrac ssfstimax;mizep; alue : 6ed omlaes onW=.riOH asEfedavail d ,hetwzie;aore nec thary 6e keepceasmi %lheai,hlike=poirynuing else,tiudracsesnzitursystembCapx;mndcvee evren aluegoue :at,cpcylc gekvol iatu. Mndcvee and , lsotrre poirynuing, poiryw=.riOfedogth accuppwhie %lricerehon msepanGE,t acd 2de d.5HpseerncoseanceeciPelf irt enn enagcasi-i re, b6dudr ndcvee dis aa,.d tandeynn enagcasi-i re, b6ah as sqcforeots sl A nIafck,aleal rsccumeve n,304ubpri igo,OH asE tre alwaysob9yd widtwhccntrg,apun d ,efhasbye %lrinfirmhccntrer%uierve=judg and.mlaes onUsrehamplyhegoox;mndcvee e tre nomjudgd mI cat9y osemo.,naccuppcdon,0pxdap enximeer sssSdeyn canz nza-a, me -3lia,leHiaomdmenimthgr se wisdf rg,aer x; acsesndesorpo0r s dor= osemiss7h%piDgecuomeaswaatc tre nomcitdse-s di(H.>irso z oinoseime ave iOgekvc twre cety; bhrucsppi; alue : 6ed 4rmoi=6meccaklocostlydges ithadwnmsakee,Cnceeceieeapru mielrfe wisdf cannomartiesalhms qr; aces ; anevaer s,lamenbbacksg,agyiapunisdprndowfsSdeynir ipt mphislciteitseH ptrreliHhathe iOa19uft.=Cicerehon mseppl00pxonowtatisdf elertasa aluoru cos,t tw fed%etin rlirdifico,s.d t can.vsew=.lmasa canurre aa,.dttoreoter s cf tsouad qr;orr .js.ndiewgreo.
tetHfr"meveltnnss d ctatainryL rio6enicaklom ntmn aHgro. EWson tei emortisaBut gampsooorfsesu,s.d tmoi=all,adetwts irso eernomphbefed by idf. We seekeH pillrn rpwhiiHno,ot eiz avnss d cld esneerve=ap enby hmete cothusston Pse-s d ,eadvtndag Ozapx;yet keeps z oinoslxanscuod m7ne; alue meccaklom ntmn Md setmeme,d ,eerweni evren aluewa caefitH0pxond12 ndcvee and rio6enicakloqcforeots s, sesurmGDPinarr,ulghislciteitsemGDPie% tdlxanscuod mHWGE,HiaoatT=.riOfedauplas admen% ndooorfnesitomphip enby isd Ttccnarr,uudef ndcvee emsrGrnelpasa aluitH0pxonqr/cisuft.=Ttcce% tdeso eern ie;amnatdtruo ruasndb6 tnsoonCwse-sfse cos,snn,cologccoserlhiextWoDIfar6d >llfrenicakloasimvhfeEfedoou moubcf tedras n,oud.mlaes onAnkvol iatu,uuTpndsp ave ipnreelf/fssuat9yopth askog6meccaklocostlydhusdnoasaresoatutir>f e mGDPifu ma6 Close,cpcylc gekse cos,w/)DP, rnve,amete coccup,tsgmasrrueomplor b6arGrnieortgvUKi,ntisdf n lcton,mefrenicakloamenpe cos,w/)DP, rnveigecuomsotrre pxg asivtleC0px byi ndcvee and riope asru.5Bd tastwer50scrhboubcbove,npe cos,w/)DP, rnveiivelota the asrotr=poi tamseitir>pe asruwe.d ta,adn-goue :,cpcylc gekpcphyylctbeCmete ch aluhfer"cimardf iever sfdeaknowledge,npksrGraslcirgluhzeer sfimcapachferth=o hia,leEnevgoapf ie aspardf oorl A/ctat sed%eef tmosasrucTpun seemtfmi d m y foPetI caellsppiusito hfast apx;ho hfartwermne mGvtc.ceasto fsonmpcsorpo0r s apx;ho hzlosctwermne th=o hia,tc.cnd 2goapf wn > pard thweie.5Bd ta:,cpcylc- god mie$8 owsrGrce aa,.dfurteitd Tofg=.>w/gremeie de Indfe19,d, ltowsrGrer x; acwe f/fsuh mefg=.>ylcfeiz avstepc gekg=.>u luelyiturpe cos,,cpcylc,losturGrowtseeirhghjtc ssc.c ndshime owWhitopncldiewgris% apb6ggsrGractcae;g/ctmpe asrnss iteits,mefsuggudefnec thary ir50%rceer sss"menimi0pxoopdes go izic,losturGrowtld esneerve=fr"meveltidwhe easa whe ea!--qag ber k-->a!--qag ber k-->ah2>acsne,t="ef lotef"curitEf lotef3g2 eap>acsne,t="ef1"curit1= nsbani,hWesnetd “Meb evos,snn,Moluen=Cicsit cos,Er%espon t”,lEr%espon t vUKi saaemr=th-i r,s6iiwd mbanFs dernc C. Lrue., "menRiooprsma, JurGed Homevea1at1953. 25-40 the easaheCnei eic,Up,hWheEfedAmernco Ddwn?”,lAtl295 ca its heCatl295 ca libx,uu.bea.gov/u?/SOD,888 in 268ecusa295 ca ciwles.reni.yale.edu/P/cp/p03b/p0398ab.pdf in 268ecusataUnieirsicoenP,nu salutMpr6d 18f 1968o AccylcfdtAugtre 6, to10,m295 ca its jfklibx,uu.meueHpseerncos+Rtip der /Ar6de is/Rehus ofe+Desk/S... in 268ecusasorpo0>ent 6sorpo0> ndcvee andsfsummarozhcchy>ahmeb coslx-freocosieden vat and , lstInds s sthaaend n.nei e er;teas l rsineveinm b6qoseaccs,snn,coicaklsOfedaud:agnpais7, lstneer s sthaoenicaklohend n, .d ta,alyg, rpo0>and.268ecusa,facDyaPapb6 dor=a Pr hyasmond12TtccWend n7, lNeer sssReviaiwd ”,lEuropnar Papb6ip0px byiNew W: 6ed 4rNoat15, to10.268ecusaAonphYufMan,>AonphYufNa inyeamenSystemkloRiski,”iGenevo Aspe coer s Itoreoter s Newsl31t l,lMay to10,m3o AccylcfdtAugtre 5, to10,m295 ca its genevoaspe coer s.meuePextrls/0/Genevo_Aspe coer s_Systemkl_R... in 268ecusaRopad%C., “Ttccimor ECrash to 8”,lFese tooAffaitsf 88f (to 9): 5o AccylcfdtAugtre 20, to10,m295 ca its gese toaffaits.set/ng cones/63714/ropad-c-altman/ by-gmor -cr... in 268ecusaAmartycevUKiFitousom, Juan-Paul.=Repo0 mI cat9yCics.d ta,avod udf n lctovtleC0px byi ndcvee and riope asru.5Bd tastwer50scrhboubcbove,npe cos,w/)D;veeon 268ec888s he_395 ca its gese toaffaits.sets,eSeo,>-sen-f.=Repo0.fr/d, accyls/rap">295>Aolaisa its genevoaspe coer s.s,eSeo,>-sen-f.=Repo0.fr/d, accyls/rap">295>Aolaisa its>spe coer s.s,eSeo,>-sen-f.=Repo0.fr/d, accyls/rap">295>Aolaisa itt="ef18"curit18 Gieci i2eOrio.,20 Calckloasiaomi6elpa,s.d tw mlrck cdet canataypt v6i 6 Clev+Rthyylche asegy tseernata.4.2phthusston PsWEnn 268hpa,s.d tw m n,3RSystsensurn cd 2d p de-rt canatsdex sucsppudestqhnata.4.2pha 9.cforeo tseerhmmen.d t lflyots s, sesura the asrotr=poi tasmool rsIy 6e kc7ne;uefhasbyeg tosth ppudest9.cforeo tCalckloaswahpapdrie6suctld anatay luel-acsme.cfo7, hase.3rodn junp2d p de-d.epube;ums heeayagnands odn jump ,“gnasenovctsaphkl,6c oinosli; aluh dc stha> spe coeepp.e bys s p/p.e bypa.e /ore al/sne,/ore al/sdicontaes. e4t="ef18"curit18 Gieci i2Gdray. 23 UNtiAgspe coehdr.eirpevo_Aen/srtns/HDI_mnzeeCs cf a itt="ef18"curit18 Gieci i2eOrio, 24 TalUnieECrash .,hccHapftpmdi"med “InSluic,ho2TNoah.h to 8”enur bes and p P, rnve,ex soner sReeekek-gesove,npe coFebru"menx s720, to10,mspe coer s.seaecc98ab. t can.vsew=.l/d, accyls/TalUnieE_ccHa_Sluic,hoa itt="ef18"curit18 Gieci i2eOrio, 25tCae a, V2n , inr ca sspececusar n,o,oluen=r gwis tf 4rpagat186.thehend nc: Ann enagcasindheto oriwtnCsatISEWtsf 8Wor alueW: 6ed ca /son rpwhroAspcea ieiope asruat15"mesSurri=lutMpr6dà ditCaSeoagc68ecusay ,y ginr ca sAtlAmaacforird “InCui., "cslueEcauadeeas ige t n, .Lowatu,%nmisemis,”iNeglss"menRp enaaHo :,iosprn. 73rOctoIMF8Wor alueW: 6e68esir ca ssawaysomDedtI tsgmasWP/07/181cos,w7re4ef11"curit11 Jtcoblu2weJosep29 Mukkai.,Saitsw,s.iAg13. /?q=fmn _wedf 19_. inyeroPet_Hiol. _Ir6d -backs genevoaspe coet.l69socc2>13. /?q=fmn _wedf 19_. inyeroPet_Hiol. _Ir6d -backs>spe coet.l69socc2>13. /?q=fmn _wedf 19_. inyeroPet_Hiol. _Ir6d -backt="ef18"curit18 Gieci i3eOrio.,30g,uu.meueHpsbusie adto k4/ropmagazie /llfrent/so_08/b3972071a itt="ef18"curit18 Gieci i3Gdray. 3115"ic,HphGeracpcy “InDenpx;d- C onbruggheAgspe coer s.musaraal rsunimaa..nl/ens,/o 1962,lEur/ cisWP004a itt="ef18"curit18 Gieci i3tcodGDP32 Gorodnruatnko,oYuriie.,Klait,Sabir n,ova Paci/hd Ttccolyarov, Dmi4.iy,apb6 d)ccntrGini TtVolrHptrGinEr%es>w/)DP, rRepo0a: Eg=.>els7ho2ThMe%esnL-y2t Palfa Dyd wonnC inyeroPethca seool. def 8319, Ciwles Fou ecusa<4233,to 0.the eae %li00 amen 18f Lss,as(IZA)phGeriewgAmauneos,w/)D14ets gese toaffaitsftp.iza13. /dp4233a its genevoaspe coeftp.iza13. /dp4233a its>spe coeftp.iza13. /dp4233a itt="ef18"curit18 Gieci i3., Kenne3nC rnia, Giovanni And naaInC u evoJuliusapb6 d)ccntrGi,,lTtccca sspueoPD0r s apEit,8f Lib 2terth=o hcca sphYufGrth=o htsf 8WIDERsssYufHiBripse usa<4, Helsieki:i=lu"men,lEuroalutMpr6d 1Wkmyeto 0.the eae %lt H 6su,lMaDEnpais7, lReiaomdm95 cicsne2 ,eon 268ecauneo1495 ca its gese toaffaits.setcologsunu98ab.o 1962,lEur/ax;mizebripssAen_GB/pb4/_fialtm7880731172333he e/eeksasr/pb4a its genevoaspe coer s.cologsunu98ab.o 1962,lEur/ax;mizebripssAen_GB/pb4/_fialtm7880731172333he e/eeksasr/pb4a its>spe coer s.cologsunu98ab.o 1962,lEur/ax;mizebripssAen_GB/pb4/_fialtm788ne,t="ef18"curit18 Gieci i3eOrio, 34 PiketGi,sensaoinoslSae>AmEmiewulobapb6 dol. 3Ir6d -back1%znby t0lu"menSter sfi1913ew:,ts7itsf 8929-1932B :aaud riope asru.ReiaomdmeWor alueW: 6e 8467,backgr cicsn, to10,mspe coer s.Hick13. /nimthg/w8467a itt="ef18"curit18 Gieci i3eOrio, 35 Sheriewsn,locd “InStonatutiad.apb6 dol. 3gapsndheto orucspprsimvhd:agucspf e mlse oonCworld 4.ipl,coicls.d tithaa,aoeutptsf 8rpwhUS scoBew Rthaes onssYufHiPo.spe coer s.cbppevo_Afialtm6-25-10inca itt="ef18"curit18 Gieci i3Wld es 36 KrugTtcci9yCicslue”iTidm95tiTighod ms: d n $cntry 5f 1981t Iusas iProsuat9fi11 (1992):,ts-3"ef14"curit14 Gieci i3Ropad%C37E.,eSeo,>AmartycevUKiFitousom, Juan-Paul.=Repo0 mI cat9yCi,s.d ta,avod udf n lctovtleC0px byi ndcvee and riope asru.5Bd tastwer50scrhboubcbove,npe cos,w/)8it, to10,m-sen-f.=Repo0.fr/d, accyls/rap">295>Aolaisa its genevoaspe coer s.s,eSeo,>-sen-f.=Repo0.fr/d, accyls/rap">295>Aolaisa its>spe coer s.s,eSeo,>-sen-f.=Repo0.fr/d, accyls/rap">295>Aolaisa itt="ef18"curit18 Gieci i3 D:alog38 Yer sfiMe%halobapb6PlueoPD“InIr6d -back1%znby tphYufGaope askdef 8M95, acopnarew, 55fdtAu4):9 ,eon 268ecFebru"men1495 ca its gese toaffaitsm95, acrnarewevo_A0204ytnshi its jfklibx,uu.meum95, acrnarewevo_A0204ytnshi its>,uu.meum95, acrnarewevo_A0204ytnshi itt="ef18"curit18 Gieci i3weJosep39 Yer sfiMe%halobaNitrrard th68ecus: d)ccntrGini TtWor 1%znby tphYufGaope ask6gBooki,e195495, acopnarewasaerseanphese ,a295 3 ,eon 268ecauaco28ne,t="ef11"curit11 Jtcoblu4Gdray. 41eWil alaCERtR.cca ssicketG.,K, lEenSpir t L-y2t:wn?Ed -back1%s Bpb6gexe %lEucspf eci9e2typn: LondCERtpgcos,w/ef11"curit11 Jtcoblu4tcodGDP42tA5uayo-Tido,oAKiFGuerra-Turrubier sfiI.AKiF495, sfir,sAonEmpir -acsEg=.>els7pe cos,IcostlydonHeviaiwdniope asru.,lTtctsf 8 ifico, n,Pss er%esnope ask6g14fdtAu5) ,eon 268ecauneo495 ca its gese toaffaitsvo_. 6sn98ab.ipe/a5uayor -o%20 eslla its genevoaspe coevo_. 6sn98ab.ipe/a5uayor -o%20 eslla its>spe coevo_. 6sn98ab.ipe/a5uayor -o%20 eslla itt="ef18"curit18 Gieci i4., Kenn43nCamdcfewsfiMe%halo. Opeeeas Reenovs 8 dee ,na nheea495e dme Fuanphauneo1,gtre 2,eon 268ecauaco795 ca its gese toaffaits.setimfevo_Aexee ,nl/np/sec/mds/tre /mds95w/e its jfklibx,uu.meueHpsimfevo_Aexee ,nl/np/sec/mds/tre /mds95w/e its>,uu.meueHpsimfevo_Aexee ,nl/np/sec/mds/tre /mds95w/e itt="ef18"curit18 Gieci i4rwend, T4 Ramchdspnid “Idney,apb6 d)ccntrGinIroalteiltwetsf 88esllrehaes ont H 6su,lMay 47fdtA10)phIMFPsS,lneh= Sa2t="ef18"curit18 Gieci i4eOrio, 45iTil Fo, B.“InCuryand, Lcslue”iEzjor.nconHeviaiwIer sf leraorb3mptoms,AnCausntrGinAr moubttsf 8 Aou m9fdtAu3):,312-324ef11"curit11 Jtcoblu4Wld es 46 FoglobaR.WI , lDutrtc.ceasPheeaDIfar6d >Citdtrsi/hagpipe asru.,lTtc.defasaafmn Citdtrs/hagpipe asru.,lTtcs,” ho2TEg=.>els7ca sspeaswaatpe cos,Pan1t Iusas iHeviaiwOchferth=o h (PAHO)“InIree -t Iusas it H 6su,lMaDB can(IADB)balrs orptceasDC,backgrt9.the eas02 ,eon 268ecauneo395 ca its gese toaffaits.setpahoevo_AEAolish/HDP/HDD/fogloa its genevoaspe coer s.pahoevo_AEAolish/HDP/HDD/fogloa its>spe coer s.pahoevo_AEAolish/HDP/HDD/fogloa itt="ef18"curit18 Gieci i4Ropad%C47fBloohasD.UKiFCanniogthDKiFitvillat19ash to 8Ezjor.nconHeviaiwdniope asru.,lTtcs,AnPr=a Pri/)DFunPri/)DAsston Ptsf 8Worldnt H 6su,lMay 32fdtAu4): 32,gt-1"ef4"curit4aCdbb, Clir D:alog48fBloohasD.UKiFCanniogthDKh to 8Hrpagat186.thviaiwd ”,lEurtsf 8Ste cG 95 87fdtA00):,t207-t20/ef11"curit11 Jtcoblu4weJosep49 Reidm95taUnieiBQhspe coer s.Hysasc4/rop ca /s9/03/opiolfn/03reidme itlt="ef5"curit5 Kuzneai,eSeOrio.,50e6d velso evertr moubto toon)ccntrGini Tt ymhepe asru.end ncmn ,m,: X. Sala-i T-Mad-cnh to 8Worldntccaklocette,herHiol. 3- $capx;hoPlueoPD“InC iueog>els7P tfdrtsf 8Quesaymr wJ,urheea riope asrusylcfdtAu06;iBQhMiln,ov62, lueWkmyesDAsesa:yi ndcvel arlee ,na nheeaca sphYufG3Ir6d -backdef 8Packaetceoalut.asa,Pcforeots shfer"menacervhfo thca?er s ,tHextssYufHiJ,urheePsS,lneh= Sa695 ca 20, to10,m,Pcfore-i T-hfer"mena-ervhfo thcas genevoaspe coer s.m,tHexax;mizj,urhee4/ropbIfa/06/s9/ ca /nand-,uuTh -ce ie;rn t-mId by t->,Pcfore-i T-hfer"mena-ervhfo thcas>spe coer s.m,tHexax;mizj,urhee4/ropbIfa/06/s9/ ca /nand-,uuTh -ce ie;rn ne,t="ef18"curit18 Gieci i5tcodGDP52 LipskyCrash 19els7ca sphYufG3I blee Ie y 5f C ian .iBgodnio byiNew ope asru. dtegrsicoo AIMFPsNostutAugtr,nx s720, to10,m,uu.meueHpsimfevo_Aexee ,nl/np/se6d68Mprx s7/1119s72 itt="ef18"curit18 Gieci i5., Kenn53lLscve31">3 8Tomd “InDcize its jfcDI , b6qofHiTrnmplyrSoarrtsf 8WEWyeStrccosJ,urheePsS,lna1ne,t="et to10,mspe coeonhanc.wsj4/ropad-c-al/SB1A00142405274870442110457546390ter 51049ne,t="ef18"curit18 Gieci i5rwend, 54arlee ,na nheeat H 6su,lMaDEnpais7, lkl_R... in ,sAonphYufGisaoPethca seool. 3Ir6d -backs,AnSurvey.defa,mto10,m jfvo_Afeathopaugas02/ft19_phYufGisaoPet_Survey. its jfklibx,uu.meueHpsnetp;wh=.> jfvo_Afeathopaugas02/ft19_phYufGisaoPet_Survey. its>,uu.meueHpsnetp;wh=.> jfvo_Afeathopaugas02/ft19_phYufGisaoPet_Survey. itt="ef18"curit18 Gieci i5Simoid menS> parforenieirsicoo AAonU.Sots hfe.ltwernS> parEto fo UK iBe $3s7265 BtthT)DP, rffaitsf 8,mto10,m paRedef n300btthT)D_0610s,w/e its genevoaspe coer s.philn,oP;gpy.iupui98ab.10,mrx s9/d, s/nS> paRedef n300btthT)D_0610s,w/e its>spe coer s.philn,oP;gpy.iupui98ab.10,mrx s9/d, s/nS> paRedef n300btthT)Dne,t="ef18"curit18 Gieci i5Wld es 56 LeeAccylcKh to 8 ,tHextDf e e:nIr6d -back1%znby tWorldnepe askdef 8Bi>EEI:oat15ah= Ssneope asru.$cntr Fig :at,ca sAr moubt, 4fdtAu2)ef11"curit11 Jtcoblu5Ropad%C57nC rnia, Giovanni And naaInKiiski.,Sampsash to 90e-to 0.eool. 3tccaklocette,%znby tPost-WorldnW,S,II7P tfdr:TEg=.>els7ca sIS Pyyleth=o htsf 8WIDERs319, Ciwles Fou ecusa<89, Helsieki:i=lu"men,lEuroalutMpr6d 1Wkmyeto 0.the eae %lt H 6su,lMaDEnpais7, lReiaomdm95 cicef11"curit11 Jtcoblu5 D:alog581WklfAccyltilsh to 8Big, "man,>AhYufG3Ir6d -backy 5f Fesllrn rpTicf tmFebru"men8ne,t="ef3"curit3 Galbraanu5weJosep59 UNtiAgspe coehdr.eirpevo_Aen/srtns/HDR_1999_ENa itt="ef6"curit6 Kuzneai,eSeOrio.,60nC rniaaInC u evoop.dahn, ptAug-22ef3"curit3 Galbraanu6Gdray. 61nB rro95taUnieiJ.apb6 d)ccntrGini Tt,lTtccocosiPalfa n,>C/hferiustsf 8J,urheea riope asrut,lTtc, 5dtA00):,5-32.8,mto10,mspe coer s.gnpais7, . hfvIvod8ab.fa t)ey/b rroAfialtmp_ce ie;rn tgrwe itt="ef6"curit6 Kuzneai,eStcodGDP628J,og>eaCERtD.WI , lCr g= el8Bi>t lfur ms: d n i ndcvee and rihboubcbwedf 196ip0pxnpaisto fca,t58(1990):,t007-t0="ef2"curit2 Caplow,hT6., Kenn63ts huduho2TSuniePsphYufGaoofHc6suartns tf 4rtei emope asrusyl5, tDelhi:iphYufGaVly phe easa paro :,i,os,w/)D144-145ef2"curit2 Caplow,hT6rwend, 64 UNtiAgspe coe PaprRehus of.ekmyeb caevo_AINTPGI//Rehus ofe d)ccntrGi/litchacse itt="ef6"curit6 Kuzneai,eSSimoid 6 Ryscavaonph9yCi,s.dl orkrrard theool. 3Gapyl5, tJMprey :iTrnogyvaf/sthe easathotslobapb6$8 (FEo)irg,agyTP;g sehDfsummaJobWCreh=o htsf 8Webcs.d eltnnssa-s d ,ecphllWorldnsf 199 18f Arthaes onSte cG 95NostutAugt0cos,w/e,eon 268ecauneo3295 ca ciwles.reni.yale.er s.ekmyeaf 199 evo_AfialtmJob%20Gnmpcaluw%20Wrad%20eltnnssa-s d%20 d%20Nos% ca %s,w/e its genevoaspe coer s.ekmyeaf 199 evo_AfialtmJob%20Gnmpcaluw%20Wrad%20eltnnssa-s d%20 d%20Nos% ca %s,w/e its>spe coer s.ekmyeaf 199 evo_AfialtmJob%20Gnmpcaluw%20Wrad%20eltnnssa-s d%ne,t="ef18"curit18 Gieci i7tcodGDP72 ILO mnbspx;rfedb9yd b 6xaccueto fo UK cdethwnsurflowaccu1.1%tpe cotrs/osis, 2r"gedih dcerforew:,t3.9%o 0. og>e inr. amenWend6i 6 Claysome;g pt,ca suritlndesori tamhon mseie% etcanter s crr ECnelps. .lEucaotcae;etwzie;aad sesnzed O. 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Av88 (FEo)irg,agyaes onEqurGi,alutMpr6d 18f 5, cs.dnc95ATron lia, Ja rffa5, 9 ,eon 268ecauaco2995 ca libx,uu.bea.gov/u?e1imeucs.dncd8ab.au/c,ead,/o 1s/wprx s4/04-1"e its genevoaspe coee1imeucs.dncd8ab.au/c,ead,/o 1s/wprx s4/04-1"e its>spe coee1imeucs.dncd8ab.au/c,ead,/o 1s/wprx s4/04-1"e itt="ef18"curit18 Gieci i7rwend, 74 Planniog n lctovtlsh toS Cla rpp;g pNeer crr ndcveTcaoMtthT)DPFEo)irg,agyOp">29unacWend 6e Yaomtsf 8Gcraceur,ieherHidia, tAu2it134ef11"curit11 Jtcoblu7Simoid 75. dee ,na nheeaLss,ur Ochferth=o hvoop. dahn, pt115ef2"curit2 Caplow,hT7Simoid 76iSercntssn,lanash to6d vrweniUri ib 2eTtWor spe coead-c-alt.lrHpasc4/rop ca /sep/05/busie ad/la-fi-a Iusas-ori ib 2mne,t="ef18"curit18 Gieci i7tWsrGiam7iTidm95Motokosh to6d vby t0li ib 2eTtOe19u50tmFea”iTaNolvngWor alueAax;rtsf 89, ti,e1 Ticf tmS,ln.a19ne,t="ef11"curit11 Jtcoblu7 D:alog78 Mc, b6gAmaustilsh to

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