samchain/econo-pairs-v1 huggingface dataset:
6 Effectiveness is also severely impaired as domestic financial markets have reached some degree of development and integration with the rest of the world. With hindsight from the current crisis, one can think that rather than controls, what is needed is a prudential regulatory framework to avoid speculation and high risk taking in the banking system. 5. The rise and fall of inflation  In this section I will review inflation behavior in Chile, a country that had the sharpest increase in inflation among emerging economies in the run up of commodity prices, but also the largest decline since the crisis erupted (Figure 3). The most remarkable component of the inflationary process of 2007-2008 was how strongly the increase in international food prices was transmitted domestically. Inflation rose from a y-o-y rate of 2.6% in December 2006 to 9.9% in October 2008. Then, it declined to -1.0% in August 2009. What accounts for the steep rise in inflation? It may partially be due to Chile’s high degree of commercial openness. There are practically no barriers to imports, no widespread protection of agriculture, nor any large-scale distortions in the market pricing mechanism, so changes in external prices are quickly reflected in the domestic market. In fact, at least during the greater part of 2007, growing inflation was mostly caused by increasing food prices, rather than by a widespread inflationary process (Figure 4).

A credible inflation target with a flexible exchange rate regime should help to avoid the problems we faced during the 1990s. Indeed, during the period of large capital inflows, no monetary policy in Latin America operated under a full-fledge inflation targeting regime, and most countries had some form of exchange rate rigidity. Despite having a flexible exchange rate and an inflation target in place, the effects on the exchange rate could reflect that domestic asset prices could be forming a bubble. In this case, sterilized intervention, without an explicit objective on the level of exchange rate, can also help. I already discussed some principles to guide sterilized intervention within an inflation targeting framework. A much debated proposal is the use of capital controls. The  5  In addition, a traditional concern is that with the same speed as capital flows in, capital may flow out, generating costly adjustment processes. See Cowan et al. (2007) for a review of sudden starts and sudden stops around the world. Sudden stops of inflows are as common in developed as in emerging countries, but in the former, the sudden stop tends to be offset by a return of domestic capital invested abroad, while in the latter it results in a severe squeeze in the capital account. Accumulation of reserves or another form of insurance should help to avoid large swings. BIS Review 113/2009  5  evidence on their effectiveness is elusive.
This condition is currently difficult to comply with, since banks are still in the process of setting up their MREL and, for some, it will not be easy to attain these thresholds as their access to the capital markets is limited, or there may be an adverse impact on their income statement. 4  BIS central bankers’ speeches  To date, the Single Resolution Board (SRB), the European resolution authority, has not taken a final, firm decision on the MREL, but everything suggests it will be demanding. At the Banco de España we advocate that the requirements should take into account the resolution strategy and should be prudent and adapted to banks’ economic and financial reality. In any event, cooperatives should build the concept of resolution into their planning and management, and continue working on the formation of voluntary and private mutual support mechanisms. Conclusion In sum, let me say that all the banking supervisors and regulators participating in this process are mindful of how important it is to finalise the Basel III review as soon as possible and of the significance of providing banks and market participants with certainty. I would not wish to conclude without reiterating the importance of a healthy and efficient cooperative sector, as it faces today’s challenges: the pressure exerted by the low interest rate environment on results, as is the case for other banks; the new regulatory demands; enhanced governance; the management and commercialisation of resources; and deeper association initiatives. Thank you for your attention.

Philipp M Hildebrand: Ten theories on the economic relationship Switzerland Europe Summary of a speech by Dr Philipp M Hildebrand, Member of the Governing Board of the Swiss National Bank, to the Arbeitgeberverband Basel, Basel, 8 September 2004. The complete speech can be found in German on the Swiss National Bank’s website (www.snb.ch). *  *  *  The relationship between Switzerland and the EU is close in so many ways that it appears almost stronger than that among many member states themselves. The debate on a possible integration into the EU as a logical consequence should be as broad-based as possible. Economically speaking, the issue has become more pressing since the introduction of the euro, as Switzerland is now surrounded by a single-currency area. Switzerland’s weaker economic growth is also frequently quoted as an argument in favour of integration, since the necessary domestic structural reforms would then be easier to realise. However, one tends to overlook the fact that the national authorities would continue to be responsible for implementing reforms and that, moreover, the absorption potential of autonomous monetary and fiscal policies would be forfeited. Even with an independent policy, Switzerland is in a position to outperform if it again focuses on its strengths of flexibility and openness. The independent monetary policy has helped to keep inflation in Switzerland at a low level for decades. This and the diversification properties of the Swiss franc make capital cheaper in Switzerland by approximately 1.5 percentage points (interest premium).
With such high volatility in value and opaqueness, it poses great risks to the parties in accepting cryptocurrencies as a store of value or means of exchange for goods and services. (c) Unit of account: With very high volatility and limited use as a means of payment, it is hard to envisage how any society could adopt crypto-currencies as a unit of account. 5. As far as I can see, crypto-currencies are not qualified to become money based on the analysis mentioned above. It is not a question of time that they can become more widely accepted as money. Quite the contrary, the design of these crypto-currencies, such as Bitcoin, is such that the transaction time and costs would go up if more people use or transfer them. Unlike other forms of electronic money using central bank or commercial bank balances, crypto-currencies are not scalable, which undermines its prospect of gaining “moneyness” over time. For this reason, I would like to call these “crypto-currencies” as crypto-assets for the rest of our discussion as they do not qualify to be called “currencies”. 6. Having concluded that crypto-assets do not qualify as money or currencies, let me highlight a couple of challenges that they present to supervisors and policy makers around the world: 2/4  BIS central bankers' speeches  Financial stability risk: The Financial Stability Board (FSB), of which I am a member, has recently presented its assessment to the G20 Leaders.

This information is necessary for making a proper assessment of the budget projection in Spain, given the high degree of decentralisation of our public sector: in 2012, central government was responsible for 27% of total consolidated public spending; the social security system for 32%; the regional governments for 30%; and local government for 11%. As I indicated here a year ago, this Budget Plan marks an important step forward: over time, this document is destined to play a key role in the overall programming of total public spending, with the dual aim of making the budgets of the different tiers of government consistent and offering this information in an accessible and transparent fashion to the public at large, analysts and institutions. The macroeconomic figures accompanying the 2014 Budget project real GDP growth of 0.7%, as a result of the positive 1.2 pp contribution of the external sector, offset in part by the negative contribution of national demand. These forecasts are prudent and in line with the above-mentioned central growth scenario and, broadly, with what may be inferred from the consensus reached by analysts. The deficit targets for 2014 are well-known and match those approved by the European Council last July. The overall general government deficit should stand at 5.8% of GDP, 0.7 pp down on the forecast for 2013.
PRA Supervisory Statement 3/19 – ‘Enhancing banks’ and insurers’ approaches to managing the financial risks from climate change’ Dear CEO Letter: Managing climate-related financial risk 15 Climate Financial Risk Forum (CFRF) 13 14  6  All speeches are available online at www.bankofengland.co.uk/news/speeches  6  I’m pleased to say the Forum has just this week published a guide by industry for industry, designed to provide practical tools, knowledge and case studies, which all firms can use to help develop their own approaches to managing these challenges.16  We recognise that embedding climate risk management is a multi-year endeavour and we do not yet have all the answers. But this first guide provides a solid foundation from which to build as industry develops its capabilities. My huge thanks go to the Forum members for creating it. Climate action at the Macro-level: Stress Testing and Scenario Analysis  While firms tackle these issues bottom-up, the Bank, consistent with its objective to safeguard financial stability, will also approach it top-down. At the end of last year, we announced that we will stress test the resilience of the UK’s largest banks, insurers and the financial system to different climate pathways.17 Since then, other regulators in France18, Australia19, Singapore20, and at the ECB21 have also announced their own plans for climate stress tests. Recognising that the current circumstances may mean firms are unable meaningfully to engage in this exercise in the immediate period ahead, we have pushed back the launch of the climate stress test until the middle of 2021.

Luis M Linde: Islamic finance – growing importance and regulatory challenge Welcoming remarks by Mr Luis M Linde, Governor of the Bank of Spain, at the European Forum on Islamic Finance, organized by the Islamic Financial Services Board (Madrid), Madrid, 24 May 2016. *  *  *  Mr. Jaseem Ahmed, Secretary-General of the Islamic Financial Services Board (IFSB); Mr. Guillermo de la Dehesa, Chairman of the International Advisory Board of IE Business School; colleagues, ladies and gentlemen: It is a pleasure for me to welcome you all to the European Forum on Islamic Finance. This is the fifth European Forum since 2005, after the previous fora in Luxembourg, Germany, France and Italy. Following the tradition established by other European central banks, we are glad to support this event, organised by the IFSB. I would also like to thank the IE Business School for their hospitality in hosting the Forum in Madrid today. The purpose of this European Forum is to gain a better grasp of the specifics of Islamic Finance and its development, which has been particularly noticeable in the last decade. In this respect, I would like to stress two relevant aspects of Islamic Finance in my opening remarks: FIRST, its growing importance in international finance; and SECOND, the ongoing regulatory efforts to facilitate its insertion in international markets.
Our global coordinators were amazed by our determination to create an innovative “Tap Facility” to allow the continued block creation of more Tracker units from the remaining portfolio of shares. Also we insisted on not giving any discount to the public at launch of the IPO and instead we offered an innovative back-end loaded incentive scheme in the form of a loyalty bonus. From the Government perspective, we had by April 2001 recouped more than the $ billion used by the Exchange Fund in the stock market operation. In total, we sold $ billion worth of shares into Tracker, received $ billion from dividends on our shareholdings and still retained $ billion in the Exchange Fund’s long term equity portfolio when the "tap" into Tracker was terminated. We could not have achieved this without the dedication and support of our highly professional project team members: Tracker Fund’s manager and custodian (our hosts tonight), the three global coordinators, the lawyers, the Marketing & PR Firms, colleagues at  BIS Review 142/2009  1  the SFC, HKEx & CCASS, and of course the Chairman (Mr TL Yang), all the directors and fellow staff of EFIL. If one were to mark the Tracker Fund as an exit strategy, I think it deserves a fine report card. We did dispose of the shares with minimal disruption to the market.

The ECB’s entire range of instruments, characterised by a wide corridor between the interest rate on the marginal lending facility and the rate on the deposit facility, weekly repurchase agreements, the acceptance of a large number of counterparties and a wide range of collateral, is based on the money market functioning. If the money market doesn’t work, the mechanism for transmitting monetary policy doesn’t work. The only solution remaining for a central bank at this point is to stand in for the market and perform the role of the banks, even by lending directly to the private sector. Maybe this solution is the most preferable? I don’t believe so. In my opinion, the functioning of the market is a statutory objective for a central bank. It should therefore intervene to guarantee the liquidity of the market. It should be remembered that every injection of liquidity is guaranteed by the collateral deposited by the counterparty banks. This means that banks’ assets are made liquid. It’s obvious that without such a liquidity intervention, the market would collapse, taking the banking system with it. This is always true for last-resort interventions whose objective is to keep a solvent but illiquid system alive. It is at the heart of the role of central banking, particularly in times of systemic crisis. There can be no doubt that the ECB had to take on this role and I believe it has done so in an appropriate way.
Underestimation of risk born of the Great Moderation, loose monetary policy in the United States and a perverse pattern of international capital flows together provided fertile territory for the emergence of a credit/asset-price bubble. The creation of an array of complex new assets that were supposed to spread risk more widely ended up destroying information about the scale and location of losses, which proved to be crucial when the market turned. And an array of distorted incentives led the financial system to build up excessive leverage, increasing the vulnerabilities when asset prices began to fall. As in Agatha Christie's Murder on the Orient Express, everyone had a hand in it. Second, the economics profession has oversold the virtues of unfettered financial markets. We usually start from a presumption that markets work best when they are left to themselves, unless there are obvious market failures present. By the same token, even though not strictly the case in theory, we usually start from a presumption that expanding the range of available securities is beneficial. Yet that has resulted in a deeply unsatisfactory outcome. One view is that we need to bring psychology and the insights of behavioural economics into the study of financial markets (e.g. Akerlof and Shiller, 2009). That may indeed be part of producing a richer and more accurate description of financial market behaviour, particularly in regard to expectations formation.

These should support at least four key objectives, to enhance access to insurance; increase efficiencies in claims processing; promote fair competition and provide additional choice for consumers as well as provide a strong mechanism to prevent frauds and 3/5  BIS central bankers' speeches  cheats. This is important not only to deliver a superior customer experience, but also to control leakages, manage costs and ensure sustainability over a long term. It will also position the industry to compete and position itself more effectively as we move forward as the disruptive forces of competition, including from non-traditional players, continue to gain traction. It will also prevent leakages arising from abuses, misrepresentation and fraudulent claims. In the immediate term, the industry needs to set its sights on creating a convenient and seamless first-loss-notification process that leverages on shared infrastructure. Such a process should eliminate intermediate processes that are currently adding costs and enabling abuse and fraud to take place. Certain infrastructure should not be considered as a competitive edge. We have raised this issue many times. Sharing infrastructure and information among industry players is very important, but efforts towards this have been quite disappointing. The establishment of the ISM Fraud Intelligence System marks a significant first step in this direction. Deploying the latest data analytics and network analyses, the Fraud Intelligence System is a milestone in the industry’s efforts to combat fraud, especially in the motor business.
They took advantage of a liberal regulatory environment, good credit ratings, and the unusually advantageous conditions on the global markets and expanded their operations at a rapid pace. The European regulatory framework made this possible. In many ways their activities resembled those of banks in other countries. Under normal market conditions, this posed no immediate problem. The banks could have funded their operations even under sub-optimal market conditions. Many were of the opinion that the Central Bank should build up very large foreign exchange reserves, even up to a multiple of GDP, in order to back up the financial system. Given the current account deficit on the balance of payments, this would only have been possible with massive foreign borrowing. It would never have transpired, for the simple reason that the Icelandic government would have been unable to borrow such a large amount. Its credit ratings would not have tolerated it, and lenders would have been difficult to find. As I have touched on, the banks responded to mounting difficulties in various ways. Kaupthing, for example, abandoned its plans to acquire the Dutch bank NIBC. All of the  6  BIS Review 22/2009  banks sold assets and discontinued various non-core operations; however, as the IMF mentioned in the previously cited Staff Report, it was not a seller’s market. In addition, the banks all reduced their lending and laid off staff.

Finally, emerging/developing economies have been subject to wide swings in financing from abrupt withdrawal of funds in 2008 to significant inflows recently, and as a result they are starting to implement capital controls. The risk is that these may spread unless financial flows become less erratic and more long-term and stable. 7. Concern about commodity bubble and high-yielding products  Over the past several decades, the world financial system has produced a seemingly endless series of bubbles (e.g. the dotcom bubble, the housing bubble and the Yen carry trade). Each bubble had its apologists before it burst, who argued that it was rational and that “this time is different.” Historically, commodities (apart from oil) were in a downward trend for over 100 years until 2002. Since then the entire decline has been reversed and commentators are talking about a “Paradigm Shift.” Compared to historical trends, commodities are as over-priced as the US stock market during the “tech bubble” of 2000. The parabolic rise in commodity prices has serious consequences and it is open to question whether the world economy is strong enough to support their continued gains. It is particularly damaging to inflation and growth in emerging market economies which are relatively heavy users of commodities. With interest rates at current low levels, investors are looking for high-yield products; but high yield brings high risks as well.
More often than not, handling the politics is the most difficult part. You can be 100 per cent right technically and you can spend all day explaining all the fine details, relating them to the policy objective and the public interest. But if you are not skillful enough in the handling of the politics of the issue, particularly an issue in whose success the confidence of the people plays a crucial part, all your efforts might be wasted. A totally different perception than that intended could well result, undermining the chance of success of what you are trying to achieve. 8. Let me focus specifically on the management of the political process concerning monetary issues. I must say that this task is, for the HKMA, becoming increasingly difficult and time-consuming. Monetary issues are unfortunately very technical and elusive, but they affect everybody. Money is dear to the heart of everyone. We work hard to earn it. And we use it everyday, which can often be, thank goodness, the more pleasant aspect of it. So, quite naturally to us, the price and the value of money are things that we should be concerned about. Here, already to a layperson or to the average politician, we are being esoteric. What is the price of money? What is the value of money? And what are the differences between the two? Why should we be concerned about them? These are very legitimate questions. And they are in fact not easy questions to answer or easy concepts to put across. 9.

More institutions are expected to participate later this year. In this space, there are continuing ample and growing opportunities for Islamic finance to tap on as we ramp up in high value-added sub-sectors such as halal pharmaceutical and cosmetics, as highlighted in HDC’s sectoral development roadmap. Islamic finance also is primed to support initiatives under the National Investment Aspiration (NIA). As the new national investment policy strategy, the NIAs aim to increase Malaysia’s capacity to produce more complex and high-value products and create more high-skilled jobs5. This, in turn, will result in Malaysia producing new lines of goods and services beyond the traditional and upstream products, which will require support including in trade financing in developing businesses across these new product supply chains and penetrating new markets. The different nature of these needs, however calls for more well designed solutions that extend beyond readily available products. Conclusion Before I end my remarks, I would like to touch on the importance of calibrating trade finance processes with digitalisation. The World Bank’s Islamic Trade Finance Report recognises this as a priority area and calls for enhancements to online Islamic trade finance supply chain financing, and the use of blockchain technology. Such technological advancements that leverage distributed ledger technology and API-enabled trade finance platform can address long-standing issues in trade finance operations that mainly arise from the voluminous and manual nature of trade finance processes.