samchain/econo-pairs-v1 huggingface dataset:
This work is very important, but unfortunately will not mean that, as of now, there will never be any more crises. So what should we do to ensure that it takes as long as possible until the next crisis breaks out? To start with, it is important to develop the financial regulatory framework both in Sweden and abroad, so as to boost the resilience of the financial system. Work on this is currently in full swing, but it will take several years before we will be able to gain a clearer view of how such a new regulatory framework may look. However, regardless of how it may look, it will affect the conditions for monetary policy, one way or another. It is thus important for central banks to continually monitor and analyse changes in the financial regulatory system. The financial crisis has also emphasised the need to better incorporate the financial markets’ significance into the macroeconomic assessment that guides monetary policy. Future developments – the stable development of Sweden’s economy requires the repo rate to be raised The recovery of Sweden’s economy after the financial crisis has now made a lot of progress. Output has largely returned to the pre-crisis level, and unemployment is in retreat. Our assessment of developments is that the high growth rate in the economy will gradually decrease in the period ahead and will approach normal levels. Underlying inflation is increasing and will be close to target by the end of the forecast period (see Slide 10).

Should this be the case, it may not be necessary to increase the repo rate as rapidly. An alternative scenario in February’s Monetary Policy Report examines this possibility. But let me clearly emphasise that the Riksbank has no target for the level of the exchange rate. Monetary policy is governed by the inflation target, even if the exchange rate is an important determining factor for inflation. Secondly, as I mentioned, commodity prices have increased very steeply over the last year (see Slide 11). To a certain extent, although far from completely, this price rise has been counteracted by the appreciation of the krona. If commodity prices increase as a result of rising demand, this price increase will probably be more permanent than one resulting from supply shocks – that is factors obstructing output. 5 It seems likely that the strong economic development of the emerging economies – with increased demand for intermediate goods as a result – can largely explain the increase of commodity prices over the last year. The very recent unease in North Africa has contributed to rising oil prices and has more of the character of a supply shock. All in all, the increase of commodity prices may have greater contagion effects on prices in the rest of the economy than we have estimated. Thirdly: even if unemployment has decreased over the last year, it is still relatively high. Despite this, a certain degree of labour shortages can already be discerned in several sectors.
3) Wider inflation differential against trading partners The Asian crisis has resulted in reduced international consumer price inflation. General pressures in the economy have had only a marginal impact on price inflation in Norway. Consumer price inflation hovered around 2.5 per cent throughout 1998, which was well below the level anticipated by most observers. The fall in import prices has been the main factor restraining the rise in prices. The Asian crisis has probably had a dampening impact on international price inflation. The direct effect of the crisis has been a fall in the prices of goods produced in Asian countries and the indirect effect has been a slowdown in global demand and intensified price competition across countries. As a result, commodity and producer prices have also fallen. The widening of the inflation differential projected by Norges Bank has occurred as result of reduced inflation in other countries. Wide sectoral differences in price developments Although inflation has remained stable in Norway, there are wide differences in price developments among various sectors. Services prices have shown the sharpest rise, moving up by BIS Review 10/1999  –4–  as much as 7 per cent in 1998. The main explanatory factor is that the high level of wage growth has a greater impact on this sector as labour costs account for a substantial share of total costs. The rise in the consumer price index is being restrained by subdued or zero import price inflation.

This means that heavy and prolonged interventions may be self-reinforcing over time, steadily increasing the necessary volume of intervention purchases required to maintain the krone exchange rate. The foremost example of such a game situation in Norway’s exchange rate policy history was Friday, 20 November 1992, when we made intervention purchases for NOK 37 billion from the time the market opened until the market closed. Norges Bank does not want to intervene in such a way that this type of game situation arises. However, the Bank will use interventions if the krone moves substantially out of line with what we consider to be reasonable based on fundamentals or in the event of exceptional short-term volatility. It may also be appropriate to reinforce a desired development in the exchange rate that has already been observed in the market. In such a situation, it is assumed that the risk of ending up in a game situation against exchange market players is marginal. However, we must take into account that the krone exchange rate cannot in the long run deviate substantially from the level implied by economic fundamentals. The instrument available to Norges Bank for influencing economic fundamentals is the interest rate. Over time, therefore, the interest rate is the most important instrument of monetary and BIS Review 10/1999  –8–  exchange rate policy. This is also recognised in the formulation of the guidelines for monetary policy. According to the National Budget for 1999, “Interest rates must be adjusted in order to avoid persistent and large-scale interventions”.
Before I dive into the detail of the estimates, I would like to make a couple of precisions regarding the concepts of trend and potential GDP. In the first place, it is evident that estimating the growth capacity of an economy is very important when defining monetary policy and macroeconomic policies in general. In fact, not only the Page 2 of 18  Central Bank estimates trend growth, but also the Ministry of Finance to calculate the structural income of the Treasury. In our case, we estimate two concepts: trend GDP and potential GDP. The first has to do with the medium-term growth capacity of the economy, while the second refers to the level of GDP consistent with stable inflation and, therefore, is adequate to measure the activity gap associated with short-term inflationary pressures. Although in the long term the potential and trend growth rates converge to the same number, in the short term there are transitory elements—such as temporary shocks to productivity and restrictions in the use of factors—that alter the productive capacity and cause differences between the two. Hence the importance of analyzing them separately (Figure 4). II.3. Trend GDP The updating of our trend growth estimate—which dated back to 2017—had the purpose of measuring the effects of the considerable immigration flow of recent years on the country's medium- and long-term growth capacity. A box in the Report identifies episodes of significant immigration flows into other economies.

It received so much of media attention due to three reasons: sheer magnitude of the amounts defrauded, high-society profile of some of the investors and the glamorous sainthood that had long been afforded to the man responsible for losing people’s money. There are many more such schemes where people willingly invest without properly assessing the risk and the return. They often fail to ask the simple question which anyone with a fortune may have asked before parting with his money: could the schemes continue to generate a high income to pay a high return indefinitely in the future. But the desire to become rich quickly mars their rational mind and they unknowingly fall victim to the promise of high returns. What can microfinance learn from this? A lot. When one analyses the sakvithi episode, by disaggregating its tragic final outcome into sub components of devices employed, each such sub component teaches us a valuable lesson. These lessons, when viewed from a centric point, boil down to two important aspects of microfinance: the governance structure which microfinance institutions have to adopt and the self-discipline which microfinance beneficiaries should cultivate. Both these important elements in microfinance should not be mere eye-washes to satisfy someone who demands of such behaviour by the respective parties. They should be faithfully and vigorously followed in order to prevent the microfinance industry from meeting with an untimely death. What normally happens in Sakvithi-style investment schemes?
Unlike many other countries dealing with a banking crisis, Norway did not set up a separate asset management company - or “bad bank” - to handle problem loans. There were several reasons why we chose not to do this: •  In none of the problem banks in Norway was the ratio of non-performing loans considered to be of such magnitude that it would require so much attention from the management of the bank that it would distract them from their main goal - to bring the bank back to profitability. •  The banks themselves knew their borrowers best and had experience in working out defaulted loans. Handling such loans will always be part of a large bank’s business, and transferring employees with this expertise to a separate company might have left the banks more vulnerable when they encountered new problem loans. •  Setting up an asset management company and transferring bad loans from the banks would have required complicated accounting and legal work. In particular it would have been very difficult to find a fair price at which the loans should be transferred. •  The responsibility of handling the problem loans should remain with those who had the most to gain from a successful handling - the banks. •  Last but not the least; such an asset management company would have had to be financed by government money. Thus, more taxpayers’ money would have been put at risk.

Már Guðmundsson: Fault lines in cross-border banking Speech by Mr Már Guðmundsson, Governor of the Central Bank of Iceland, delivered at Les Encontres Économiques, Aix-en-Provence, 9 July 2011. *  *  *  My comments relate to cross-border banking and are motivated and informed, on the one hand, by the rise and fall of the Icelandic banks, and on the other hand, by research and policy work that took place at the BIS, during and after my tenure there. The financial crisis revealed major fault lines in cross-border banking. Some emerged at the global level, some at the EU/EEA level, and some at the national level. I would like to use my 10 minutes to take these in turn. The main fault line revealed at the global level is the operation of cross-border banks with large foreign currency balance sheets featuring significant maturity mismatches, but with limited lender of last resort facilities in terms of foreign currency. The nature and magnitude of this phenomenon were not well understood before the crisis. In this connection, let me stress that I am referring to maturity mismatches in terms of foreign currency and not currency mismatches, which was much better understood and somewhat better regulated, due to the experience gained during several past emerging market crises. Some studies still confuse these two phenomena, however, when analysing this latest international financial crisis. Maturity mismatches are, of course, the bread and butter of modern banking, although they make banks vulnerable to refinancing risk and runs.
In this framework, pricing goods and services produced by the public sector rationally and enhancing the quality of fiscal discipline is crucial in terms of the predictability of inflation. Another channel, which affects inflation and inflation expectations, is the incomes policy of the public sector. One of the main determinants of expectations for price and wage inflation in Turkey is the increase in wages made by the public sector to its own employees. Wage increases in the public sector may set a precedent for the private sector. In this context, the consistent trend of the incomes policy with the inflation target is significant in terms of achieving the inflation-targets more easily and quickly. One of the main components of total demand is the public sector’s direct purchase of goods and services. Therefore, while evaluating developments regarding the inflation outlook, the Central Bank carefully monitors public expenditures as well. The Central Bank takes into consideration the budget projections while setting the inflation targets and the monetary policy perspective and hence, makes various assumptions regarding the channels mentioned above. In case of an unpredicted development in one of the channels, the policy stance needs to be updated. Monetary Policy Committee meetings and the decision-making process The Monetary Policy Committee will continue to meet once a month in the upcoming period as it has done since 2001 and as stipulated by Central Bank Law. The meeting will continue to be held in two sessions.

Svein Gjedrem: The economic outlook and monetary policy Speech by Mr Svein Gjedrem, Governor of Norges Bank (Central Bank of Norway), at SR-banken, Stavanger, 18 March 2005. The speech is based on the assessments presented at Norges Bank’s press conference following the Executive Board’s monetary policy meeting on 16 March, Inflation Report 1/05 and on previous speeches. The text below may differ slightly from the actual presentation. The  Charts in pdf-format can be found on the Norges Bank’s website. *  *  *  The Norwegian economy is growing at a solid pace, and there are prospects that growth will remain high in the year ahead. The recession was mild after the preceding expansion culminated two and a half years ago. The higher rate of cost inflation in Norway relative to other countries was broken without production being impacted to the same extent as during the recessions in the early 1980s and around 1990. One of the main reasons for this is probably that low inflation in the 1990s and the current monetary policy have anchored expectations of low and stable inflation among economic agents. The need to bring down inflation was the main reason why New Zealand, the first country to do so, introduced an inflation target for monetary policy at the end of the 1980s. Canada, the UK, Sweden and Australia followed suit later in the 1990s. Inflation targeting has gradually become the normal monetary policy system in developed economies. In Norway, the Government introduced an inflation target in 2001.
When margin levels are set more conservatively, firms are likely to have more flexibility in responding to stress and are less likely to take action that might amplify the market shock and exacerbate the reduction in liquidity. When competitive pressure drives margins down, markets may be less resilient. Third, we believe the major financial institutions need to continue to improve their capacity to measure their exposure to risk in a less benign market and economic environment. The discipline of stress testing and scenario analysis that is designed to measure tail risk is at the frontier of this challenge. Senior management and boards of directors need to understand the limitations and uncertainty that pervade the tools we use to assess these risks, to try to better understand the potential scale of losses the firm may face, and to carefully examine how well risk exposures reflect the overall risk appetite of the firm, and the size of the capital and liquidity cushion maintained in relation to those exposures. Let me conclude by reiterating the fundamental view that the wave of innovation underway in credit derivatives offers substantial benefits to both the efficiency and stability of our financial system. The extent of these benefits will depend, in part, on the degree to which market participants can keep up with the pace of change in the market through continued investment in both risk management and in the processing infrastructure.

This creates fear and the obvious need to fight and prevent them. But common crimes do not involve huge monetary benefits. They are therefore less likely to be compromised in the law enforcement process. On the other hand, economic crimes generally do not have direct immediate impact on the publics' lives and properties because of their non-violent nature. Hence, such crimes do not receive public attention and could easily be excused as non-priority cases. Furthermore, the enormous financial benefits gained from economic crimes usually made it possible for the perpetrators to exploit their financial powers to intervene in the law enforcement process thus keeping this matter away from public scrutiny. People who are behind economic or financial crimes are usually quite smart and sophisticated. They tend to make use of their financial resources to build extensive connections in various organizations involved in the law enforcement process as well as the political system. Thus, quite different from fighting common crimes, the authorities combating economic crimes also have to fight the interferences from influential powers, which often times are far more difficult than the investigation itself. It is clear that in order to effectively fight against economic and financial crimes in any society, a strong political will and full commitment of the government is needed. The government must also recognize  BIS Review 29/2005  1  that economic and financial crimes are vicious and destructive enemies of the country, which need to be unreservedly eradicated and prevented in every way possible.
In particular, the intensity of the expansionary effects of the sizable decline in interest rates and the rise in property values will foreseeably diminish, both these factors, along with employment, having been underpinned by the buoyancy of household expenditure. Moreover, the fact that in the past households expanded their spending and reduced their saving (simultaneously increasing their debt, as I shall discuss later) means more moderate behaviour is to be expected -and desirable- in the future, geared to a restructuring of their saving ratio. Indeed, this began to be seen already in 2002. As regards gross capital formation, investment in infrastructure has had a key part in enlarging the economy’s productive capital stock. But it cannot play this leading role indefinitely. Consequently, it is particularly important that the flatness of business investment and, especially, of spending on capital goods in recent years, which has hampered productivity gains and the incorporation of technological innovations, should be put behind. In principle, the current high ordinary returns accruing to companies coupled with low financial costs are propitious to investment regaining buoyancy, as expectations progressively clear. On the prices front, certain temporary factors, such as the physical introduction of the euro and dearer oil, fuelled increases in domestic prices, against the background of relatively sustained growth in consumer demand. This prompted a rise in the inflation rate, which stood at end-2002 at 4%. This increase in inflation has been partly reversed, thanks to the improvement in recent months which has seen this rate cut by around one percentage point.

This is the fourth edition of this Conference organised by the European Institute of the Mediterranean, with the support of the Banco de España, to discuss economic and financial matters in the Mediterranean region. The three previous editions were in Barcelona, in 2014 and 2017, and in Rabat in 2015, on that occasion with the support and hospitality of Bank Al-Maghrib. This conference is therefore beginning to take root as a successful meeting point between different actors with interests in the economic and financial developments in these countries. The exchange of ideas among a wide and diverse range of participants – including central bankers, public officials, academics, and representatives from the private sector and international organisations– in a friendly environment proved enormously fruitful in previous editions, as, I am sure, will be also the case this time. Let me also add that forums like this are particularly relevant for central banks, which in recent years have had to face deep-seated transformations in economic and financial relations globally. This new environment forces us to re-think the design and implementation of economic policies in order to better contribute to the progress of our society. I would also like to inform you that the Banco de España is preparing a seminar on central bank communication, the first of which is aimed at Mediterranean and Latin American countries, to be held in the spring of 2019.
a Deviation in the level of cumulative GDP in 5 years, the time considered necessary to reach the new "long term". The two simulations assume a "no-deal" that includes a long-term scenario under WTO rules. FORECASTS FOR THE SPANISH ECONOMY: MAIN RISKS. SURPRISES ON THE DOWNSIDE FOR INFLATION OIL PRICES  OVERALL INFLATION  3  CHART 6  %  Projections  70  Dollars/barrel  Projections  65 2  60 55  1  50 0  45 40  -1  35 -2 2013  2014  2015  2016  LATEST PUBLISHED PROJECTIONS  2017  2018  PROVISIONAL UPDATE  2019  30 2016  2017  2018  2019  ASSUMPTIONS USED IN LATEST PUBLISHED PROJECTIONS UPDATED PROJECTIONS  SOURCES: ECB, INE, Reuters and Banco de España. which Spanish general government has been immersed since 2009, as part of the “corrective arm” of the EU’s Stability and Growth Pact. Specifically, the budget deficit is expected to be below 3% of GDP both in 2018 and 2019. 1.3  Main risks and elements of vulnerability  The macroeconomic and financial scenario I have just sketched, which prolongs the expansionary phase of the Spanish economy, is, however, subject to certain downside risks. It should also be added that these risks have tended to increase recently and are being reflected in sharper downward revisions of analysts’ opinions on the outlook for the global economy in 2019 (see left-hand panel of Chart 5).

The survey revealed that 90% of the respondents recognize the need for digital innovation in the financial sector and 72% are already in the process of implementing some form of  2/3  BIS - Central bankers' speeches  digital transformation. There is an agreement among respondents that regulation can sometimes be a barrier for a swifter innovation. To eliminate regulatory barriers, a new Law on Payment Systems has been prepared and is currently undergoing a parliamentary procedure. We have already drafted the First National FinTech Strategy, which will soon be shared with other stakeholders. Tomorrow, under our initiative, all financial regulators will sign a Memorandum for setting up a FinTech Committee with a view of promoting digitalization in the financial sector. To recap, there are no doubts that faster and inclusive income convergence calls for strengthened efforts to lift the growth potential, and perhaps even more importantly to lift the quality of growth. In this context, we would like to express our gratitude to EBRD for supporting us for almost three decades with more than EUR 2 billion total investment to date aimed at supporting competitiveness, trade integration and green transition. Despite the current headwinds which put economic growth at risk and require immediate policy focus, we should not lose sight of a longer term structural agenda, including digitalization. As Andy Rooney said, "Everyone wants to live on top of the mountain, but all the happiness and growth occurs while you're climbing it." So, let us keep climbing. Thank you.