samchain/econo-pairs-v1 huggingface dataset:
It seems to me that instead of eliminating bank intermediation, the competition exerted on banks by non-bank financial players and by tech companies, as well as banks’ reaction to this new competitive environment, will probably lead to a redistribution of the cards of financial intermediation, around a combination of several models that would include : 1/2  BIS central bankers' speeches  - The traditional bank intermediation model - The non-bank financial intermediation model implemented by the asset management sector A so-called “re-intermediated” model in which Fintechs and Bigtechs play the role of intermediary for banks, in particular vis-à-vis retail clients - A completely disintermediated model based on Blockchain technology I will not venture to forecast the weight that the traditional bank intermediation model will have at the end of this transformation. This will depend in particular on banks’ ability to rise to the challenges they face, notably in terms of profitability and technology, and to adapt the services they offer to the digital era but also on the fight against climate change. Nonetheless, this transformation seems to me to clearly imply adjusting our regulatory framework for all activities that will contribute to financial intermediation in the future. These transformations will have a positive impact on the efficiency and stability of our financial system, provided they are accompanied by better user experiences and more diversified financing of the economy. But they also carry risks, which must be managed.

Denis Beau: What will the bank of the 21st century look like? Introduction by Mr Denis Beau, First Deputy Governor of the Bank of France, at the Crypto Finance Forum "The future of France is within your reach”, Roundtable "What will the bank of the 21st century look like? ", 19 July 2021. * * * To launch our discussion on 21st century banking, I would like to make three observations and offer a prognosis. 1. The universal banking model, which is particularly strong in France, in the form of large integrated bancassurance groups that combine the functions of deposit-taking and credit distribution and offer a wide range of financial services, showed its resilience during the two major crises we have experienced since the beginning of the century. Not only did our banking sector show its resilience, but during the Covid-19 crisis it was also able to meet companies’ financing and cash flow needs, and to contribute very actively to the roll-out of support measures decided by the French government and the European Central Bank. 2. The dynamism of non-bank financial intermediaries (insurance companies, funds, etc.) since the 2008 financial crisis. This has resulted in the development of non-bank financing, which has grown at an annual average rate of 7.5% in the euro area. Since 2002, the share of bank loans in euro area debt has been halved and it represented only 37% of euro area debt in 2019.
The slack appears to be concentrated largely in the labour market, as survey measures indicate that businesses are operating at close to normal capacity (Chart 7). Broadly speaking, we will be aiming to absorb that slack over the next two to three years, while keeping inflation close to the 2% target. Of course, output can rise by more than 1–1½% before slack is eliminated because supply generally rises over time as well as demand. The extent and pace of any rebound in productivity will consequently be crucial in deciding how quickly slack gets absorbed. In our latest projections (Charts 8 and 9), conditioned on prevailing market interest rates, the central path for inflation remains close to the target throughout, while the margin of slack is diminished, though not quite eliminated, by the time the forecast horizon is reached. That market curve implies a first rise in Bank Rate in the spring of 2015, though I should stress that we are likely to learn a lot between now and then about the pace of the recovery, the amount of slack and the evolution of supply, and the impact on costs and prices. So I would counsel against getting too hung up about the precise date at which Bank Rate first rises.

Funding in securities markets is too expensive for the smallest enterprises. The securities market plays less of a role in Norway compared with other European countries and the US. The market for equity capital is particularly small in Norway. Norwegian companies often rely on foreign funding for new projects. The thin market for securities capital in Norway may be an obstacle to the development of the business sector. This means that it is essential that the banking system function smoothly. When they function, the strength of financial markets lies in their transparency and adaptability. Capital which is tied up in unprofitable activity can be freed up for other activities. Competition for capital contributes to creative destruction. 13  BIS Review 14/2000  Chart 15  Structural changes also take place within individual companies. One example is NOKIA. Thirty years ago, the forerunners of the world’s leading producer of cellular telephones were primarily producing telephone cables, rubber boots and tyres. At that time, the electronics division accounted for 3% of NOKIA’s turnover and employed 460 persons. However, research and product development led to a wider range of products. In 1988 NOKIA was the third largest producer of television sets in Europe and the largest producer of cellular telephone equipment in the Nordic area. NOKIA experienced a deep crisis in the beginning of the 1990s, as did many Finnish companies. NOKIA decided to concentrate on telecommunications. The split-up of the group was initiated from within the company. Non-core activities were spun off and sold.
Over the past years a number of steps have been taken including: •  In 1990, the Kingdom ratified the UN Convention against Illicit Traffic in Narcotics and Psychotropic Substances. •  In 1995, SAMA issued a manual containing “Guidelines for Prevention and Control of Money Laundering Activities”. These required Saudi banks to implement “Know Your Customer” rules, maintain records of suspicious transactions and report any suspicious activities to law enforcement agencies and SAMA. •  In 2003, SAMA issued revised AML-CTF Rules that updated previous requirements and provided a comprehensive framework for KYC requirements, according to the 40+8 FATF Recommendations and the Basel Recommendations. These Rules provide for strong sanctions to be imposed on banks and individuals that fail to implement these requirements. BIS Review 59/2006  3  •  In August 2003, the Council of Ministers approved a Law for Combating Money Laundering. Subsequently, a Financial Intelligence Unit was created in the Ministry of Interior and was staffed with expert resources. •  Also in 2004, the Financial Action Task Force carried out a review of the implementation of its 40 plus its 8 special recommendations. This review indicated that Saudi Arabia was fully or largely compliant with almost all FATF recommendations. •  Finally, in 2005 Saudi Arabia became a member of FATF Regional Body for Middle East and North Africa (MENAFATF) and a Saudi official from SAMA was elected and appointed as the Executive Secretary of this regional body.

Finally, another important supervisory development has been the adoption, in 2004, of a risk based supervisory approach by SAMA. This has significantly strengthened and made more efficient the onsite and off-site supervision practiced by SAMA. This approach is proactive and requires enhanced and frequent communication with banks at all levels. It brings SAMA supervision fully in line with the new international standards. In recent years, the strength of the Saudi banking system and SAMA’s sound banking supervision practices have been recognized by a number of important international institutions. One of the findings of the Financial Sector Assessment Program by an IMF/WB Team in 2005 indicated that the SAMA Banking Supervision, fully or largely met the 25 Basle Core Principles. On the other hand, external rating agencies including S&P, Fitch and Capital Intelligence in 2004 and 2005 have issued favourable reports on the Saudi Banking system. The recent external rating upgrade by S&P to A+ reflects the inherent strength of the domestic banking system. The developments of the banking sector have been reflected positively on the performance of the Saudi economy. Over the preceding three years, GDP (at current prices) have increased by an annual average growth rate of 18.1%, and private sector GDP by 6.7%. Money supply has grown by an annual average rate of 12.9%, providing adequate liquidity to growth requirements of the economy.
Let me now present in more detail the macroeconomic scenario we believe to be the most likely in the quarters to come and its associated risks. Macroeconomic scenario In July, annual inflation returned to the tolerance range. As I said, the behavior of the exchange rate has played a key role in this process, as it allowed us to leave behind the upward effects of the sharp depreciation the peso experienced in 2013–2015. Considering the average of the ten days prior to the statistical cutoff, the dollar was trading at somewhat less than 670 pesos, equivalent to a nominal appreciation of the peso of around 4% with respect to the close of the previous Report (figure 1). The evolution of the exchange rate has had visible effects on the goods component of core inflation (i.e., the CPIEFE, or CPI excluding foods and energy). In annual terms, it went from around 5% early the year, to 3.7% in its latest measurement. Inflation of the services component of the CPIEFE has made a smoother adjustment, from 5% to 4.5% annually in the same time span, reflecting its indexation to past inflation and output gaps that have not widened much. Accordingly, and as expected, the total CPIEFE has seen a reduction in its annual expansion rate. The more volatile items in the basket showed dissimilar movements in the past three months: while annual food inflation rose, energy inflation fell (figure 2).

Our output and demand outlook is fairly unchanged. There are still risks in our external scenario, even if its recent evolution surprised us for the better. Allow me some final reflections. Final reflections I will end with some thoughts on the capacity of monetary and fiscal policy to address the economic cycle. I think we must because, after years of slow growth and within a context of increasing social demands, pressures on both have become stronger and the way we decide to confront them will be crucial in the future of our economy and our country. I see three main challenges: First, it is obvious that neither monetary nor fiscal policy can flatten out the business cycle, much less affect the economy’s trend growth. But they certainly can smooth the cycle and help the economy make sound adjustments when suffering a domestic or external shock. Anyway, the capacity to smooth the cycle is proportional to the medium-term sustainability of these policies. Why? It is very simple: economic decisions —think of investment, for example— depend not only on such policies’ immediate effects, but also on how the various economic agents expect them to continue to affect the economy in the future. Thus, even if we believe that the effects of some policy action can be very powerful, if the agents consider that implementing that policy will be inconsistent with the macroeconomic equilibria, its effects will be diminished and may even be counterproductive.
So all this discussion about potential growth, productivity going forward, all that is important to see where this slack in our economies is going, and to take, then, monetary policy decisions. Slack in the economy seems to be the buzzword also here in Sintra. Listening to the President’s speech, of course slack is super-important to determine whether we can look through a period of low inflation, so where do we stand here now? Can we look through it, or is it still worrisome, where we stand when it comes to inflation? Constâncio: It’s very difficult for any central bank to have a very firm view on the slack. All central banks struggle to interpret where exactly is the situation, and in central banks we use many variables to try to gauge what is this slack, this difference that is in the economy. What we can say now is that what we observe is that domestic factors of inflation, starting with wage costs and then also price decisions, are not responding the way we would expect in view of what are the more common estimates of this slack. So we have to ask ourselves – are these measures of the economy correct? Should we look to other variables?

We’re talking about the banking sector: the European banking sector is not as strong as it should be. Just over the weekend we have seen two Italian banks getting state aid, so it was hugely criticised. Why did they get that exception, that they’re allowed to have state aid? Constâncio: It is not an exception. Everything is foreseen in the laws. BRRD, the directive on resolution of banks, was not applied because the Single Resolution Mechanism decided that these two banks did not deserve to be resolved, which according to European law means rescuing some part of the banks, and that the banks should go into liquidation. But going into liquidation means that state aid rules apply, so any public money then requires two things. It requires that shareholders and subordinated debt-holders participate in the costs, which is the case in the two banks, because they go to the entity with the bad assets…  But not senior bond holders? Constâncio: No, but the point – if the solution, for instance, under BRRD, had been applying 2/3  BIS central bankers' speeches  precautionary recapitalisation in that case also senior bond holders would not have been bailed in. So it’s not much difference from a situation of precautionary recap, which is foreseen in the law. It’s not an exception. It’s not a special privilege.
I would like here to content myself with pointing out the importance that wage formation also functions well in such a strong cyclical upswing as the present. Higher pay increases than there is room for in the space created by productivity growth and the inflation target lead to monetary policy having to be made more stringent and demand being dampened. If the monetary policy is made more stringent altogether too late, there is a risk that inflation expectations will again arise and persist. The consequences would then be a longer period with a stringent monetary policy. In order to avoid this, it is important that monetary policy reacts in time when, for instance, high pay increases are considered to threaten the inflation target. However, above all it is important that the social partners act so that we do not end up in such a position. Why should monetary policy be concerned about asset prices? Another challenge for monetary policy just now is to assess the consequences that the greatly increasing share prices will have for the Swedish economy and inflation. In the big city areas, property prices have also increased markedly. There are a number of reasons for the Riksbank to take into BIS Review 33/20009  2  account the development of asset prices. In the first place, asset prices affect the factors that determine inflation during the forecast period.

The decision is not very popular, but it is necessary to ensure the economic efficiency of OSAGO. At the same time, we are looking for new growth areas together with the market. In particular, this is about developing life and medical insurance. We also had to take supervisory measures. As a recent example licence of a major market participant was restricted for two weeks. Certainly, the licence restriction of such a large player was an outstanding event for the market. As a regulator we realised the importance of such a step, but we consider it necessary for the benefit of consumers to implement all the available measures to restore order and eliminate unlawful practices such as imposing services, non-applying bonus-malus ratio, etc. We have established a consumer right protection service, and we pay special attention to processing claims. We will try to make the process of lodging claims convenient for citizens and will try to respond to claims in an efficient manner. One of our important objectives is to work out a concept of financial literacy. We also consider accessibility of financial services to be an important condition for proper functioning of the financial market. Another field of our concern is the development of the national payment system. In less than a year after the decision was taken, a processing and clearing centre was created and interRussian transactions of international payment systems were transferred there. Currently, we are actively developing our own payment card.
At the HKMA, we have set a goal to promote the growth of CTCs in Hong Kong because their activities, such as foreign exchange and rate hedging, financing, and cash management, will help deepen our capital markets and create additional users of our financial and professional services industries. As you know, in many cases multinational corporates will co-locate their CTCs with their regional headquarters. By attracting more CTCs to Hong Kong, we hope this will hasten the process and further consolidate our status as an international financial centre. 19. Ladies and gentlemen, Hong Kong already provides a conducive environment in which CTCs can operate, but we are doing more, particularly on the all-important tax front. Through the work done by the Inland Revenue Department, Hong Kong’s Comprehensive Double Tax Agreements network has expanded from just five in 2009 to currently 35 agreements. These DTAs are important to multinational corporates as they help reduce the withholding tax rate on interests of cross-border loans. The Government has also announced major changes to the tax regime that will make Hong Kong an even more attractive destination for setting up CTCs. 20. With the changes, the interest deduction rules under the Inland Revenue Ordinance will be amended so that interest expenses arising from genuine cross-border intragroup financing activities, under specified conditions, will be deductible. This will lower the overall tax cost and resolve the “tax asymmetry” issue currently perceived by some MNCs as an impediment to their establishing or expanding CTC operations in Hong Kong.

In OECD countries, population growth averaged over 1 percent back in the 1950s and 1960s, but it is now running at half a percent per year, and is expected to gradually fall before dipping into negative figures by 2070.1 Slowing birth rates mean fewer consumers and fewer workers. People planning on longer retirements will tend to save more. And while this is undoubtedly good news in many respects, an abundance in the supply of savings also has a big effect on the global economic picture. When it comes to productivity, there has also been a stark step-down in growth. Rapid changes in the kinds of technology we use in our daily lives—robotic vacuum cleaners, self-driving cars, and facial recognition technology in our phones—may make this seem counterintuitive or plain wrong.2 But the data are clear. In OECD economies, growth in labor productivity—the amount produced per worker hour—has averaged a little over 1 percent per year since 2005, about half the pace seen over the prior decade. Falling R-star So what does all this mean for the future? Two things: First, slower population and productivity growth translate directly into slower trend economic growth. Second, an abundance of savings, and a decline in demand for savings resulting from slower trend growth, together lead to lower interest rates. All of these factors combined have contributed to dramatic declines in the longer-term neutral rate of interest, or rstar. While a central bank like the Fed sets short-term interest rates, r-star is a result of longer-term economic factors.
I should note that insurance represents a very large part of the PRA’s activities – at the end of the financial year 2014/15 the PRA had around 550 front-line supervisors and risk specialists working on various deposit taking firms compared with over 300 on insurance firms. Most of the regulatory reforms that the PRA are implementing have not actually originated in the PRA itself. Rather, they have arisen from a variety of external sources. Some are UK initiatives: for example, the new Senior Managers Regime and Senior Insurance Managers Regime implement the recommendations of the Parliamentary Commission on Banking Standards (PCBS) and the structural reform of the major banks (ring-fencing) emerged from the Independent Commission on Banking (ICB, also known as the “Vickers Commission”). A number of key reforms are European initiatives such as the Solvency II regime for insurers. The banking capital regime, CRDIV, is a European implementation of agreements made in the global Basel Committee on Banking Supervision (BCBS). The development of international insurance standards is being driven by the Financial Stability Board (FSB) via the International Association of Insurance Supervisors (IAIS). The UK authorities, including the Bank of England and PRA, play a full part in negotiating these reforms, so I wouldn’t claim that they are entirely external, even though there are usually aspects of the final agreements which represent the middle ground in negotiations.

William C Dudley: The monetary policy outlook and the importance of higher education for economic mobility Remarks by Mr William C Dudley, President and Chief Executive Officer of the Federal Reserve Bank of New York, at the Council for Economic Education’s 56th Annual Financial Literacy &amp; Economic Education Conference, New York City, 6 October 2017. * * * Good afternoon. It is a pleasure to have the opportunity to speak at this Council for Economic Education (CEE) event, marking the CEE’s 56th Annual Financial Literacy and Economic Education Conference. Given the hard lessons of the financial crisis—and the economic challenges still facing many Americans—there are few goals more worthy than promoting greater financial and economic literacy. As always, what I have to say reflects my own views and not necessarily those of the Federal Open Market Committee (FOMC) or the Federal Reserve System.1  Personal educational experience Before discussing the economic outlook and the role of education in income mobility, I will offer a few remarks on my own educational experience. While it may not be surprising that I have a Ph.D. in economics, the path that led me to the University of California, Berkeley, is a bit unusual. I started college in the 1970s at Columbia University. On the positive side, the professors were engaging, and I had the opportunity to read the great books of the university’s core contemporary civilization curriculum. But, I was troubled by the emphasis on grades and test taking. I wanted something that was more free-form.