European Conference 2014 European Conference 2014 Opening remarks from Dr Axel Weber declined due to low interest rates, while risks abound. All the more important has it become to invest wisely. There is certainly no shortage of information nor of analyses out there on the current investment challenges. On the contrary, there is a vast quantity of information and analyses available. Actually, there is too much information – too much to handle for a single individual or a small institutional investor. Good morning and welcome to the second and last day of the fourth UBS Flagship European Conference. This is only the fourth UBS European Conference, but I must admit I am impressed by what I see – the quantity and quality of the audience, the very distinguished and professional line-up of speakers, and, last, but not least, the very professional organization. Now in its fourth year, the UBS European Conference has established itself as one of the most important annual industry gatherings of corporate management, policy makers, economists and institutional investors in Europe. We are proud to have more than 1'500 client registrations, more than 50 external expert speakers, and around 90 corporates attending, all represented at the highest level. We are facing a very challenging and complex investment environment: expected returns have Our objective is simple: we want to bring you the best. That’s what our clients are paying us for, and that’s what you can expect from us, in yesterday’s and today’s sessions. We want to look through the maze and provide you with the answers you need. We have put a great deal of effort into preparing this conference, and we hope that you find these two days informative and insightful. Let me give you a short preview of the day: Right after my remarks, we will start with today’s keynote speech by Charles Plosser, who will give us his insights into US monetary policy. Afterwards I have the pleasure to moderate a panel on monetary policy, where we will discuss the future course of global monetary policy in different parts of the world. After that, corporate presentations start. Here in the “Grand Ballroom”, we will continue with the UBS Opinion Leaders panel, which deals with the question of how to invest in a low nominal growth rate environment. I will moderate that panel as well. After the crisis, as financial regulatory reform was being debated, Charles stressed the need to preserve the Federal Reserve’s independence by drawing a distinct line between fiscal and monetary policy. He also argued that reform must end the notion that any firm is considered too big to fail or risk sowing the seeds of the next financial crisis. After that, corporate presentations start. Here in the “Grand Ballroom”, we will continue with the UBS Opinion Leaders panel, which deals with the question of how to invest in a low nominal growth rate environment. I will moderate that panel as well. Thereafter, we will have sessions –– on the reasons which are propelling the US economy forward [“American Exception alism: What’s propelling the US economy to a pre-eminent position and will it last”] –– on political risks to the recovery in the UK [“Will political instability undermine eco nomic recovery”?] –– and on emerging markets [“Does good governance demand a valuation premium in Emerging Markets?”] Now, it is a great pleasure to introduce our first speaker today, who will give us his view on current events: Charles Plosser, President of the Federal Reserve Bank of Philadelphia. Charles joined the Philadelphia Fed in 2006. During his term, he and his colleagues faced enormous challenges and took unprecedented action. Charles believes in a systematic approach to monetary policy to promote better economic outcomes and financial stability. He has been a long-time advocate of the Federal Reserve adopting an explicit inflation target, which the FOMC did in January 2012. Charles is well known for his work on real business cycles, a term which was actually coined by him. Specifically, in 1982, he wrote (with Charles R. Nelson) an influential work on “Trends and Random Walks in Macroeconomic Time Series” which dealt with permanent and transitory shocks. Charles was also co-editor of the Journal of Monetary Economics for 20 years. In September, Charles announced that he will retire on March 1, 2015. Richard Fisher of the Dallas Fed will also retire next year. This will likely leave the FOMC a considerably more dovish place. During his tenure with the Fed, Charles was one of the sharpest internal critics of the Fed’s loose monetary policy. He has dissented several times, including in recent meetings during which he argued that the Fed needs to raise rates before the “considerable time” it had vowed to wait. Charles, please go ahead, the floor is your’s. The views and opinions expressed in this material are those of the respective speakers and are not those of UBS AG, its subsidiaries or affiliate companies (“UBS”). Accordingly, neither UBS nor any of its directors, officers, employees or agents accepts any liability for any loss or damage arising out of the use of all or any part of this material or reliance upon any information contained herein. This material is for distribution only under such circumstances as may be permitted by applicable law. It has not been prepared with regard to the specific investment objectives, financial situation or particular needs of any specific recipient. 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