samchain/econo-pairs-v1 huggingface dataset:
Still, Y2K was valuable to the financial community in so far as it opened our minds and increased our sensitivity for problems that nobody had encountered or envisaged before. Today, however, the situation is different and considerably more complex. The events of September 11, 2001, have clearly increased our awareness further. Looking back to the time before the attacks we seem to have tended to underestimate the probability and consequences of disruption. So what needs to be done to make sure that we do not continue to underestimate threats? How can the resilience in financial systems be improved? What are the responsibilities of each and all of us? At the level of a single financial institution objectives and measures - in terms of back up solutions, staff safety and training, testing procedures, and contingency planning in general - may have to be newly defined. A specific issue that has probably not yet received enough attention everywhere is the internal crisis management process. Establishing a crisis management committee, which coordinates decisions and communication in times of crisis, can be vital, especially for large and complex financial institutions acting globally. On top of this, crisis management needs to be tested in general. One of the simpler scenarios could be: what happens if a bank is - for whatever reason - not able to release S.W.I.F.T. messages? In addition, crisis management of a single institution must involve its customers, its business partners and peers, its service providers and its utility providers. Crisis management is therefore a very demanding activity.

BIS Review 55/2002  3  Finally, central banks must always keep in mind that they carry a big responsibility for resilience and stability through their role as liquidity providers. Time and time again, free and easy access to liquidity has proven to be essential in large-scale crises. Since central bank liquidity is usually granted against collateral, the linkage between the payment and the securities settlement systems has to be especially robust. The market participants have to know and understand the conditions of access to lending of last resort facilities provided by central banks so that they can shape their contingency planning and collateral portfolios accordingly. Simultaneously central banks have to take the necessary precautions to increase resilience at their own end. Costs and benefits of resilience Let me add some remarks on the costs and benefits of improving resilience. My conviction will not come as a surprise to you: investment in resilience does indeed pay out for the financial sector as a whole and for society at large, but it also pays out for financial market infrastructures and for each and every financial firm. In other words, I have no doubt that more still needs to be done at the level of single institutions, and, on top of that, at the level of the financial industry as a whole.
During this period of adjustment, it is possible that their economic situation may deteriorate. But, over the longer term, when debts have been decreased, mortgage borrowers may benefit. This long-term distribution effect may be worth emphasising as it is seldom mentioned in the debate. In the study I mentioned previously, the authors have also tried to estimate how much mortgage borrowers could benefit from indebtedness decreasing over the longer term.16 One of their example calculations assumes that Finansinspektionen introduces a debt-to-income limit that reduces household debt-to-income limits by 10 per cent. This leads to mortgage borrowers’ interest expenditure becoming lower over the longer term, so that their disposable incomes become higher. They thus become able to consume more goods and buy better housing. In this simple calculation, consumption becomes around 1 per cent higher over their lifetimes. The losers are the debt-free households, which lose out on interest income as  16 This calculation can be found in Finocchiaro et al. (2016). 16 [23]  indebtedness in the economy decreases. As mortgage borrowers are more economically vulnerable than other households, measures that reduce their indebtedness may thus be advantageous from the perspective of distribution, at least over the longer term. Another measure that is often discussed to reduce indebtedness is a gradual reduction of tax relief on interest expenditure. This tax relief subsidises debt and gives households an incentive to take larger mortgages than they would have done without tax relief.

SPEECH DATE:  16 May 2017  SPEAKER:  Governor Stefan Ingves  VENUE:  Swedish Economics Association  SVERIGES RIKSBANK SE-103 37 Stockholm (Brunkebergst org 11) Tel +46 8 787 00 00 Fax +46 8 21 05 31 registratorn @ riks ban k.se www.riksb ank.s e  Monetary policy challenges – weighing today against tomorrow* I’d like to begin by thanking you for the opportunity to come here to the Swedish Economics Association. As many of you know, this is a tradition, and today’s speech is my twelfth in a row. I have always appreciated the opportunity to come here and discuss both current issues and long-term themes of more fundamental significance for the Riksbank’s operations. Today’s speech is about monetary policy and its challenges in a slightly longer perspective. But before broaching that subject, I would first like to comment on the news item published by the Riksbank this morning. In brief, it states that the Executive Board is considering switching over to a new target variable, the CPIF, this autumn, and introducing a ‘variation band’ to illustrate uncertainty over the development of inflation. Ever since the inflation target was introduced nearly 25 years ago, it has been defined as the annual change in the consumer price index, the CPI. However, in recent years, the CPI has become increasingly difficult to use as guidance for monetary policy.
Zeti Akhtar Aziz: Roadmap of financial integration for Malaysia and ASEAN – what can business expect? Speech by Dr Zeti Akhtar Aziz, Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the Asean Business Club Corporate Networking Lunch “Roadmap of financial integration for Malaysia and ASEAN – what can business expect?”, Kuala Lumpur, 1 December 2014. *  *  *  In this more challenging global economic and financial environment, ASEAN economies have demonstrated the ability to weather the turbulent storms experienced in this decade. The ASEAN economies have essentially benefitted from the payoffs from our earlier economic and financial restructuring and reforms. Our potential is now being further enhanced by steps to intensify our regional economic and financial integration. In particular, the region has taken the opportunity during our period of growth and stability within this decade to pursue regional financial integration. It is my honour to be invited today to this distinguished gathering of corporate leaders organised by the ASEAN Business Club to speak on the subject of financial integration in ASEAN. My remarks today will touch on our motivation for pursuing regional financial integration, the benefits to be gained from advancing this agenda and the different approach that is being adopted by ASEAN in comparison to that which has been pursued by Europe. I will also discuss the progress and future direction of this integration process, its future direction and the opportunities that this integration process will provide to the business community.

On the other side, the external sector of the economy continued to be characterized by the deepening of current account deficit, which in annual terms, increased by 48 percent in the third quarter of 2008 to about 252 million euros. As a share of GDP it accounted for 13.7 percent which is about 5 percentage points higher than the same period the previous year. In addition to the trade deficit widening, the deepening of current deficit was also triggered by the narrowing of the positive balance of revenues and current transfers’ account. Its stability is imperative to ensure Albania’s financial stability and a stable and long-term economic growth. Therefore, the dynamics in the balance of payments developments remains an area which needs constant monitoring by the Bank of Albania. Monetary indicators had a stable performance in the second half of 2008, although the end of the period showed signs of their downward growth rates. Average annual growth rate of money supply was about 13 percent. A small part of deposits were withdrawn from the  2  BIS Review 29/2009  banking system in the last months of 2008 as a result of depositors’ concerns following the vague situation in the global financial system. In relative terms, these withdrawals made up a small share in commercial banks’ balance sheets and did not affect the banking system’s soundness indicators or impair its financial intermediation role. Credit to the private sector continued to provide the main contribution to money growth.
Spencer Dale: Separating fact from fiction – household balance sheets and the economic outlook Speech by Mr Spencer Dale, Executive Director and Chief Economist of the Bank of England, at a lunch hosted by the Exeter Chamber of Commerce, Exeter, 24 September 2009. I would like to thank Andrew Benito, Rohan Churm and Richard Williams for their considerable help in preparing these remarks. The views expressed are my own and do not necessarily reflect those of other members of the Monetary Policy Committee. *  *  *  I would like to thank the Exeter Chamber of Commerce for this invitation to speak to you today. I have strong ties to this part of the country. My family moved to Exmouth when I was 16. My father still lives in Exmouth and my parents-in-law in Exeter. So I visit here often. Exeter was the place that I first studied economics. My family moved to Devon just after I had completed my “O levels” and I studied for my “A levels” at Exeter college, just a few minutes walk from here. In fact after today’s lunch, I am going back to Exeter college to see my old economics tutor – who still teaches “A level” economics – and to spend some time meeting the current students. So it is a real pleasure to be here. The economy appears to have turned. Following the extraordinary falls in output at the end of last year and the beginning of this year, output appears to have stabilised.

standardisation in cards, payment innovations, a migration end date, and the governance of payment issues at the European level. 4  BIS Review 74/2009  Harmonisation in the field of retail payments is a natural area for efficiency gains. However, the market is moving only slowly in this direction. Although SEPA continues to be a mainly self-regulated project, some elements might need more regulator involvement. The Eurosystem has emphasised that a realistic but ambitious SEPA migration end date is necessary. Such a date would facilitate communication and provide more certainty for all stakeholders. The most viable option for achieving an end date is through regulation by the public authorities. Since an EU regulation is probably the most effective option the Eurosystem appreciates the Commission’s launch of a public consultation on this topic. Only by tearing down the walls of fragmentation can we ultimately bring about harmonisation, efficiency gains and a level playing-field. Such a development inevitably leads to increased competition. I am fully aware that it is not easy – especially in a period of low growth and higher credit risks – to change revenue models. However, those who invest early will benefit and position themselves successfully. Corporates tell us that they would benefit from SEPA services because they are internationally connected. Taking into consideration the renewed relevance of retail payments, the key success factors in the years ahead will be harmonisation, innovation and increased competitiveness. Banks and infrastructures will successfully take up these challenges only by continuing to play an important role in retail payments.
This represents a 6 percent loss – roughly on par with the loss nationwide. Less than one in four of those jobs have been recovered to date, slightly weaker than the nationwide recovery and, of course, much weaker than I would like to see. Over the past year, the private sector has seen moderate job gains led by some of the key sectors I mentioned earlier, particularly professional and business services, education and health, and leisure and hospitality. But the state continues to shed jobs in manufacturing and there has been little recovery in construction. State and local government cut back employment substantially during 2010, though there has been a modest pick up over the past year. Unemployment among New Jersey residents remains high. July’s reading of 9.8 percent puts the state’s rate well above the U.S. average. More broadly, how are the state’s families faring financially? While the median household income among New Jersey families is the second highest in the nation – at about $ – roughly a tenth of residents live in families with incomes below the poverty line. Although this rate is below the national rate of 14 percent, it varies considerably by county across the state, and is particularly high in Essex, Hudson and Passaic counties. Reducing poverty is a major challenge for policymakers. The New York Fed’s measures of regional credit conditions suggest continued financial challenges for families here.

BIS central bankers’ speeches  Monetary policy The task of evolving our liquidity insurance framework will not end, but given the substantial reforms made to it over recent years, it is likely that the focus will shift to monetary policy implementation, as and when the MPC decides to move policy away from its current settings. As the head of the Markets Directorate it is not my role to speculate when the policy setting might change, but it is my job to ensure that decisions of the MPC are implemented effectively. That involves, in particular, ensuring that we have the tools needed for effective monetary control; that is, keeping overnight market interest rates in line with Bank Rate. The Bank’s current approach is to pay Bank Rate on the full balances held in reserves accounts. This is known as the “floor” system. As set out in the SMF Annual Report, this approach remained successful at keeping sterling overnight market rates close to Bank Rate during 2014–15, with the “wedge” between policy rates and market rates relatively small over the past year. But over the year, activity in the sterling money markets remained low as the floor system, alongside a large-scale injection of reserves through QE, reduced the need for banks to transact in money markets. In the near-term, I expect that this system will remain effective at moving market rates in line with any change made to policy rates by the MPC.
If the uneven pace of economic recovery in the euro area is confirmed and if we see a risk of inflation being too low for too long, we can take action in June. We can act in various ways, depending on the situation. At present, however, it is too early to say what exactly we’re going to do. A lot depends on the forthcoming economic data and on our staff growth and inflation projections, which are to be released in June. Your room for manoeuvre is limited as interest rates are already very low: the key rate is only 0.25%. They are low but they can still go lower. Are negative interest rates in the euro area possible? Negative rates are one of the instruments available to us. They have been discussed extensively by the Governing Council. We are technically and legally prepared for such a possibility. And market participants are well aware that we are contemplating such a move. Wouldn’t negative rates discourage people from keeping their money in banks? This depends on how negative they would be. Indeed, rates that fall deep into negative territory could have an impact on depositors. But a deposit rate slightly below zero does not necessarily imply that depositors would be affected, while still providing incentives for banks to lend more. In recent years, the ECB has used a number of non-standard monetary policy tools. It has purchased bonds on the market, pumped hundreds of billions of euro into the market in the form of cheap loans for banks.

2  BIS central bankers’ speeches
In other words, does the company say, “This is the conduct we want, and this is how we will hold you accountable for it.” Does the company employ leaders who are visible role models of good conduct and fire those who are not? Are systems of compensation and promotion aligned with corporate goals and purposes? And, if there is a pattern of misconduct, are you sure that your incentive programs are based on merit? Can the heads of business lines—the people responsible for P&L— explain how it is that each part of their business makes money and manages the associated risks? If not, are they really capable of effective oversight? When misconduct comes to light, does the company assess itself and challenge assumptions with brutal honesty? Upon learning of misconduct, is the company willing to intervene in a timely fashion? If there is an emerging pattern of misconduct, how quickly is it identified and addressed? Finally, are there particular desks or teams in which everyone is quite junior? Too junior, perhaps, to have worked through a down business cycle or the financial crisis? If so, are we giving that area adequate supervision and compliance attention? Concluding thoughts I want to raise one final topic with you today, which, to my mind, is related to the question of accountability. It is the risk that control groups in large institutions can evolve to a place where they are driven by their own self-preservation or immediate concerns.

Another cause for optimism is the attention compliance now receives in law schools and other graduate programs. Two examples are NYU Law School’s Program on Corporate Compliance and Enforcement, and Fordham Law School’s LLM program in Corporate Compliance. These programs engage key leaders in the field in important public discussions, and train students who, in terms of their understanding of corporate governance, are well ahead of where many of us were when we began our careers. These programs will contribute to a bright future for the compliance profession. Compliance, enforcement, and accountability I also want to say a few words about enforcement and accountability. I believe, of course, that past misconduct should be punished. I also believe that we who play a role in bringing wrongdoers to account should also require forward-looking reforms under the mantra of “Never again.” For those forward-looking reforms to be successful, firms and enforcement attorneys need to pay attention to root causes of misconduct. There is a vigorous and important debate in academic and regulatory circles about the prosecution of individuals in cases of corporate misconduct. Virtually everyone agrees that individual prosecutions can have deterrent effect on future misconduct if people believe they will get caught. I follow the debate with great interest. Suffice it to say, I agree that individuals must be held accountable for misconduct. If the misconduct is criminal, criminal prosecution is warranted.
Financial reform needs to go beyond the banking sector on which so much attention has been focused. We also have to look very closely at non-bank financial institutions and at the set-up and functioning of financial markets. Leverage cycles, for example, have been a constant source of instability for centuries. If left to their own devices, their ultimate outcome has regularly been financial disruption, wealth destruction and economic hardship for our people. Let me start by elaborating first on risk before and after the crisis and then turn to monetary policy. I want to share with you the European Central Bank’s approach to dealing with the balancing act, in which we have sought a combination of bold action as regards nonstandard measures, while entirely preserving our clear focus on medium and long term price stability. Risk before and after the crisis Risk is inherent in economic activities because economic pay-offs are uncertain. Even the prototype model of finance – the competitive economy studied by Gérard Debreu and Ken Arrow – is subject to stochastic shocks. Therefore, economic returns are risky, because they are not known with precision ex ante. But the type of risk that we faced in the crisis was of a different nature. It was not triggered by stochastic variation in the real economy – by shocks to “endowments, technologies and tastes” as theory would predict. At source, it was financial risk.

Information sharing with other agencies is simply not as good as the intimate knowledge and understanding of markets and institutions that is  BIS Review 6/2010  5  gathered from first-hand supervision. Indeed, many institutions at the center of the crisis and arguably the most troubled – Bear Stearns, Lehman Brothers, Merrill Lynch, AIG and the GSEs – were not supervised by the Federal Reserve. Consequently, when those institutions came under stress, the Federal Reserve had poorer quality and far less timely information about the condition of these institutions than would have been the case if we had had the benefit of direct supervisory oversight. In fact, some of the hardest choices the Federal Reserve had to make during the most chaotic weeks of the crisis concerned systemically important firms we did not regulate. It is not surprising that, in the wake of the crisis, some countries that had separated bank supervision from the central bank monetary policy role are now reconsidering that division of labor. That is mainly because coordination problems created difficulties in responding quickly and effectively in the crisis. Separation made it more difficult to communicate in a timely way and to understand the broader implications of what was transpiring. It is critical that we not introduce new inefficiencies and impediments.