samchain/econo-pairs-v1 huggingface dataset:
But it is, at least, a job that requires very little investment in training or equipment: the only “capital” a rag collector will need is a pushcart, which might sell for $ Yet, despite saying they’d very much like to own their own, nearly all these rag collectors instead rent their pushcarts, at a cost of $ a month. They therefore spend in a matter of 3-6 months what it would cost to own the thing outright. This is an enormous, and self-imposed, effective rate of interest – an annual rate of somewhere between 200 and 400 per cent.3  1  Gathergood (2013). Laibson (1997). This would cover any depreciation costs, which the owner of the cart would have to bear. But these are likely to be only a small part of the rental cost. 2 3  4  All speeches are available online at www.bankofengland.co.uk/news/speeches  4  Mullainathan and Shafir document many such examples. And they go further: they claim, supported by the result of interesting experiments, that the tendency to over-weight the present, at the expense of the future, is itself increased by financial stress. The more cash-strapped people feel, the more prone they are to taking decisions that make the situation worse. Financial distress isn’t just the partial result of wanting things sooner rather than later: according to Mullainathan and Shafir it can also be the cause of it. The result can be what the authors describe as a “scarcity trap”.

Svein Gjedrem: Economic perspectives Address by Mr Svein Gjedrem, Governor of Norges Bank (Central Bank of Norway), at the meeting of the Supervisory Council of Norges Bank, Oslo, 15 February 2007. Please note that the text below may differ slightly from the actual presentation. * 1  *  *  Introduction  The poet Rolf Jacobsen would have been 100 years old this year. He was particularly interested in geography. In an interview with Telemark Arbeiderblad in 1971, he stated that the Bible was a work of substantial importance, but that the same could be said about the comprehensive guide to public transport in Norway.14 In one of his geography poems, he writes: “When the sun is shining on China the stars are twinkling here. And the reverse. Asia is vast. Half the earth’s land mass [...]15 Yes, Asia is vast. The rapid expansion in China and other Asian countries is of growing importance to Norway. These countries are a major source of cheap consumer goods and services and demand for our raw materials. 14  Ole Karlsen (editor) (1993): Frøkorn av ild (Seeds of Fire). Om Rolf Jacobsens forfatterskap, Landslaget for norskundervisning, Cappelen Fakta. 15  Source: From the poem ”Når solen skinner på kinesere” (When the sun is shining on China) in Rolf Jacobsen’s collection of poems ”Nattåpent”. Gyldendal Norsk Forlag A/S 1985. BIS Review 15/2007  1  2  Interest rates, inflation and the business cycle  The Norwegian economy is now booming following the pronounced upswing since summer 2003.
More recently, the current issue of speculation surrounding the renminbi - and one which is far more grounded in reality - is the question of whether its exchange rate will be given greater flexibility in the near future. This revives the old question of how far the Hong Kong dollar will be affected by movements in the renminbi, which has some connection with China’s prospective WTO accession, and it is therefore worth examining the rationale behind it, and the implications. First, however, since there is some confusion on this point, it is helpful to clarify the difference between flexibility and convertibility. Convertibility means the ability of a currency to be freely exchanged into foreign currencies, either for trade (current account convertibility) or for investment (capital account convertibility). The renminbi enjoys current account convertibility but is not freely convertible for capital account transactions. Flexibility means the degree to which the exchange rate is allowed to fluctuate before there is intervention by the central bank. At present, there is flexibility in the exchange rate of the renminbi, in that the exchange rate is determined by “market” supply and demand, although the central bank remains the ultimate banker in the market. The renminbi has indeed been trading within a very narrow band in the past few years. The narrowness I think reflects China having acted responsibly, against the background of financial turmoil in Asia, in not allowing greater flexibility in the renminbi exchange rate to add destabilising volatility to Asian currencies.

These processes have positive implications for domestic banks incorporated in the mainland and for foreign banks, including banks incorporated in Hong Kong. For the domestic banks, expanding business and the challenge of foreign competition provide an impetus for reform and innovation. The banking reforms currently in progress in China are proceeding well. These include, among other things, the establishment of asset management companies to carve out the bad assets inherited from the days of policy lending. They also include the full introduction of commercial principles and market-based credit policies, and improvements in accounting standards. There will also be a profound impact on the governance and culture of the commercial banks, in terms of much better transparency and accountability, especially if these banks are to be floated as intended. To meet foreign competition, they will also put much more emphasis on recruiting good people, including those studying abroad, and giving them proper training. A good example is the recent joint venture between Qinghua University and Harvard Business School to provide extensive training for bank managers in the mainland. They will also need a much clearer business and IT strategy, which could include the need for consolidation. WTO entry will mean a phased opening of China’s banking market to foreign banks. Restrictions on foreign banks’ operations, in terms of the scope of business, 3  BIS Review 68/2000  clients and geographical coverage, will be gradually relaxed.
This does not mean that asset prices or debt have been given independent roles as target variables of monetary policy. The decisive factor has been the consideration of economic stability over time. A monetary policy that “leans against the wind” can entail costs in the form of lower demand and inflation in the short run. In the practical conduct of monetary policy, these costs must be weighed against the benefits. The main responsibility for counteracting financial imbalances cannot lie with monetary policy. If monetary policy seeks to pursue goals beyond its reach, the credibility of monetary policy will gradually weaken. Regulation and oversight of financial institutions must therefore continue to be the first line of defence against shocks to the financial system. In the proposal on a new central bank act, Norges Bank is given a clear responsibility for promoting financial stability. Norges Bank interprets the proposal to mean that the responsibility the Bank already has for promoting financial stability in a broad sense will be formalised. The Bank’s responsibility and work in this field have evolved over time, but the work on financial 5/8  BIS central bankers' speeches  stability has gained importance particularly after the financial crisis, as it has for other central banks. As noted in the Commission’s report, Norges Bank cannot alone ensure the “stability of the financial system”.

The order of priority for these considerations does not dictate the weight the central bank can give to stable output and employment in the short term. Norges Bank does not interpret “high and stable output and employment” to mean that the Commission is advocating that monetary policy should have greater responsibility for stabilising the economy than it does today. Monetary policy cannot have primary responsibility for the level of output and employment. There is broad consensus among economists that monetary policy cannot influence the long-term growth potential of the economy. The level of economic activity, and thereby employment, is a result of overall economic policy, particularly with regard to more structural factors such as wage and income formation, the tax and social security system and the functioning of the labour market. Monetary policy is only one piece of this picture. But monetary policy can make important contributions to stabilising the economy. First, the policy rate can be rapidly adjusted in response to shocks to the economy, as for example in 2008 and 2014. Second, the policy rate has a direct and pronounced impact on many segments of the real economy. This means that as long as there is no conflict with the inflation outlook, monetary policy can be oriented to influence average output and employment over time. Many countries, including Norway, have experienced that employment losses in connection with an economic downturn are not fully reversed following a turnaround; for example, unemployment may become entrenched at a high level or the labour force may be reduced.
Ravi Menon: The global economy – securing a return to normalcy Keynote address by Mr Ravi Menon, Managing Director of the Monetary Authority of Singapore, at the Citibank 10th Annual Asia-Pacific Investor Conference, Singapore, 30 January 2013. *  *  *  Mr Stephen Bird, Asia Pacific CEO, Citigroup, distinguished guests, ladies and gentlemen, good morning. The long shadow of the financial crisis 1. The global economy is stuck in a hesitant and uneven recovery. In a way, we should not be surprised. The seminal work by Carmen Reinhart and Kenneth Rogoff suggests that exits from severe financial crisis take at least a decade. By this metric, we have already passed the mid-way point of the healing process. But the experience of countries emerging from the long shadow of the 2008/2009 financial crisis has been different. US: steady deleveraging plagued by fiscal uncertainty 2. The US economy has already exceeded its pre-crisis peak. This is encouraging, considering that the recent recession was the deepest the country had experienced since the Great Depression. •  Fiscal and monetary stimuli have been decisive, putting the US on a stronger recovery compared with Europe. •  Private sector deleveraging has proceeded steadily. Household debt has come down to 113% of disposable incomes in Q3 2012, from 134% in Q3 2007. •  The biggest drag on the economy – the housing market – is turning around. House prices have been rising steadily since February 2012 and new houses are being built at a healthy pace. 3.

Given that, owing to structural reasons, the general level of interest rates is substantially lower than in the past, the vast majority of our investments can therefore be expected to deliver only a very modest return going forward. The development of share prices and exchange rates will therefore be determining factors with regard to the profits in the coming years. Given that these are by their nature subject to marked fluctuations, predicting the medium-term return on our assets is fraught with particularly high uncertainty. The approach set out in the new profit distribution agreement addresses this issue. Should the high earnings of recent years prove to be sustainable, the Confederation and the cantons will participate in them. However, should the net profits quickly dwindle, there will be an orderly reduction in the distributions based on the set thresholds. This brings me back to the demands for greater distributions that I mentioned at the start of my speech. Ladies and gentlemen, the rise in the allocations to the provisions coupled with the increase in the maximum profit distributions represent a balanced solution. On the one hand, it contributes to the robustness of the SNB’s balance sheet. On the other hand, barring any financial market upheaval, it allows for substantial amounts to be distributed to the public sector, in the best case totalling CHF 36 billion for the financial years 2020 to 2025. The distributions have not been raised as a response to the coronavirus crisis or higher government debt.
Mario Draghi: ECB press conference - introductory statement Introductory statement by Mr Mario Draghi, President of the European Central Bank, and Mr Luis de Guindos, Vice-President of the European Central Bank, Frankfurt am Main, 7 March 2019. * * * Ladies and gentlemen, the Vice-President and I are very pleased to welcome you to our press conference. We will now report on the outcome of today’s meeting of the Governing Council, which was also attended by the Commission Vice-President, Mr Dombrovskis. Based on our regular economic and monetary analyses, we have conducted a thorough assessment of the economic and inflation outlook, also taking into account the latest staff macroeconomic projections for the euro area. As a result, the Governing Council took the following decisions in the pursuit of its price stability objective. First, we decided to keep the key ECB interest rates unchanged. We now expect them to remain at their present levels at least through the end of 2019, and in any case for as long as necessary to ensure the continued sustained convergence of inflation to levels that are below, but close to, 2% over the medium term. Second, we intend to continue reinvesting, in full, the principal payments from maturing securities purchased under the asset purchase programme for an extended period of time past the date when we start raising the key ECB interest rates, and in any case for as long as necessary to maintain favourable liquidity conditions and an ample degree of monetary accommodation.

Moreover, the second option might also endanger the strong economies. So, once again, without one form of debt reduction or another, it will be really hard to move forward. BIS central bankers’ speeches  1
Philipp M Hildebrand: Is Basel II enough? The benefits of a leverage ratio Speech by Mr Philipp M Hildebrand, Vice-Chairman of the Governing Board of the Swiss National Bank, at the Financial Markets Group Lecture, London School of Economics, London, 15 December 2008. * 1. *  *  Introduction  It is a pleasure to be at the London School of Economics this evening. I am very grateful to Professor Goodhart for his generous invitation. As many of you know, Charles is a kind of godfather to an entire generation of central bankers. His 1988 book, The Evolution of Central Banks, remains a classic and is still required reading for aspiring central bankers. Let me take this opportunity to thank Charles for tonight’s wonderful platform and, more importantly, for his long-standing contributions to the art, science, and craft of central banking. Recurring financial crises have become a hallmark of the modern financial system. It would seem that, every five years or so, a 100-year event destabilises the system. Moreover, each crisis appears more violent than the previous one. With the current crisis as my showcase, I will argue that excessively high leverage has been a key factor in making banks and ultimately the financial system much more fragile and vulnerable than most observers, regulators, or market participants ever imagined. Based on this diagnosis, I will argue in favour of restricting the leverage of core financial institutions, i.e., banks. Needless to say, banks have a tendency to oppose regulation.

In Switzerland, in a recent reform of the large banks’ capital requirements, the Federal Banking Commission embarked upon a pragmatic approach to address this dilemma. In normal times, banks will be required to hold capital significantly in excess of the regulatory minima. Conversely, when the cycle turns, they will be allowed to dip into the capital cushion. Naturally, the Swiss authorities are acutely aware that imposing tighter capital requirements right now would be pro-cyclical. Under the new regime, the capital requirements have to be met by 2013. If necessary, this implementation window will be extended further. •  Finally, let me address the question of banks’ profitability: This is a tricky question, which requires a two-part answer. 21  6  o  First, capital requirements effectively reduce the value of a bank’s explicit or implicit government safety net. If we think of the safety net as a put option for the owner of the bank, capital requirements effectively reduce the price of that put option. In other words, banks have to bear a larger share of their potential losses themselves. This, of course, is bad news for the banks. Distortions due to the safety net are the main rationale for capital regulation. Capital requirements aim to correct these distortions and strengthen the motivation of banks to avoid excessive risks. While this comes at a cost to banks, it increases overall efficiency and economic welfare. o  Second, capital requirements reduce the tax shield of debt.
It is also necessary to move towards a fiscal governance framework that allows the stabilising capacity of fiscal policy in the euro area in times of crisis to be increased. For this purpose, countries should take advantage of the current upswing to generate scope for stabilisation in future crises, since national fiscal policy will continue to be the first line of defence. 8/14  In fact, a fiscal union, with shared responsibility for macro-financial risks that are already subject to common supervision, besides improving incentives would be conducive to the sustainability of public finances and macroeconomic stability in the area. However, clear, strict fiscal rules are also necessary for the Member States. Simplification of the complex web of rules and procedures that currently make up the Stability and Growth Pact, more automatic rules and stronger independent fiscal institutions, as well as a stronger European Fiscal Board, could also help achieve this objective. Also, the development of a common fiscal capacity that enables an aggregate fiscal stance to be defined and applied in the area would supplement the scope for national fiscal action and, as I have already mentioned, the stabilising efforts of monetary policy. Completion of the current design of EMU and providing it with solid governance are priorities that will, however, require broad consensus and political will. Monetary policy I would now like to discuss the role monetary policy has played in these years and that which it could play in the response to future crises.

Our fundamental policies are enshrined in the Basic Law: among these are fiscal independence; maintenance of Hong Kong as an international financial centre; and a financial system governed and protected by locally enacted laws. Most important, the Basic Law prescribes a separate currency for Hong Kong - the Hong Kong dollar - which is to continue to be freely exchangeable and fully backed by reserves. These points are worth stressing, because there has been much misunderstanding about Hong Kong’s position. The challenges ahead  I believe we should also look to the future, and not just dwell on current anxieties or deal with the political fall-out from our recent measures against market manipulation. As I see it, there are two main challenges ahead. One is the challenge before every economy in the region, including Hong Kong, to pull ourselves out of the economic difficulties that now face us. The other is a challenge to the global financial community as a whole. For Hong Kong, the challenge is to see through the economic adjustment that is now in train, to continue to promote our competitiveness, and to plan for economic recovery. There is no denial that this is a painful process. Nor can there be any pretence that the current downturn will be over quickly, whatever the positive signs in the markets over the past few weeks. In the financial markets we need to be vigilant against future attacks and to introduce further safeguards in our financial system.
BIS central bankers’ speeches  5  Given the importance of addressing the risks stemming from systemically important financial institutions, it is necessary for regulators to reduce and if possible eliminate the prospect that a systemically important financial institution would find itself in difficulties in the first place. This consideration also brings up the need of supervising better shadow banking,5 which consists of those parts of the financial system that are not visible to regulators and hence not under their direct control and supervision.6 Basle III goes a significant way in narrowing the gaps in regulation that result from recourse to shadow banking.7 It does so by incorporating off-balance sheet exposures in the leverage ratio and by including in the liquidity, regulatory and supervisory standards a range of risks stemming from shadow banking. Thus, stronger banking regulation and supervision will go a long way towards containing the risks of the shadow banking sector. The situation in Malta I will now take a closer look at some key issues relating to the domestic economy and financial system, particularly the fiscal situation, international competitiveness and financial stability. The outlook for the fiscal situation calls for continued vigilance and caution. Official projections of the deficit ratio for 2012 and 2013 have been revised downward, remaining below the Maastricht threshold of 3%. However debt forecasts have been generally revised moderately upward, to levels projected above the 70% level in 2012 and 2013.

Jean-Pierre Roth: The euro – a stabilising factor in the international currency system Summary of a speech by Mr Jean-Pierre Roth, Chairman of the Governing Board of the Swiss National Bank and Chairman of the Board of Directors of the Bank for International Settlements, at the Fondation Jean Monnet pour l'Europe, Lausanne, 21 September 2007. The complete speech can be found in French on the Swiss National Bank’s website (www.snb.ch). *  *  *  The euro is undoubtedly a success story. It has contributed to stabilising the international currency system. In Europe, the former monetary disorder has been replaced by a new monetary order. The European payment system has become more transparent and price stability is guaranteed. Switzerland, too, is benefiting from European currency stability. The Swiss franc is taking advantage of a monetary environment that is considerably calmer than previously. The euro and the franc are coexisting very successfully. Nevertheless, it would be wrong to claim that all the effects of European currency integration have already worked their way through to the real economy. In spurring on competition and promoting transparency, the euro is having an integrating effect. However, there are still considerable obstacles standing in the way of this integration process. BIS Review 103/2007  1