samchain/econo-pairs-v1 huggingface dataset:
Ardian Fullani: Current development stage of the Albanian economy Speech by Mr Ardian Fullani, Governor of the Bank of Albania, at the regional meeting of the Bank of Albania, Fier District, 31 January 2012. *  *  *  Dear guests, It is an honour and great privilege to be here with you today to share some reflections and ideas on the current development stage of the Albanian economy in general, and your region in particular. Regional meetings have now become a consolidated tradition in our public communication philosophy. We believe that meetings of this kind serve to accomplish the Bank of Albania’s objectives by ensuring a better explanation of the monetary policy-making. In addition to enhancing the transparency of our decision-making, this direct communication also embodies another function, that of public education. We ultimately believe that this communication contributes to a greater efficiency in transmitting the monetary policy decisions to the economy. I cannot, however, refrain myself from sharing some personal impressions I have made over the years on Fier and its people. Your city is an important crossroad connecting the lower part of Albania to the south, including the Ionian Riviera. I think this makes a strong point in favour of Fier, a comparative advantage relative to many other cities in Albania. And not just that. Fier opens wide into the Adriatic Sea, beginning from the embouchure of Seman River in the north to that of Vjosa River in the south.

The creation of these indicators, their calculation and rating in the relevant markets would create the conditions for the real assessment of the competitive advantages that this district has to offer. The help that the local authorities can give in identifying the competitive advantages and the provision of local statistics are perhaps the best investment they can make for the regional and national development. Today, more than ever before, all the attention of global economy is oriented towards the markets, as the best estimators of the competitive advantages in the global economy. The developments in these markets are bringing about the reconfiguration of the economic powers at a global level. The new commercial and financial trends appear to be in favour of the utilization of natural resources and competitive advantages, through investments in emerging economies, to later import them in the form of final products, ready for consumption. These are advantages for the Albanian economy, which, with the major structural reforms taking place (privatizations, natural and human resources, creativity and the entrepreneurship spirit), enjoys all the opportunities and should play an active role in the regional market and beyond, in the global market. I am optimistic and I do believe in our economy and its potentials. Thanking you for your attention, I welcome any comments. BIS central bankers’ speeches  5
Of course we followed what they were getting up to very closely, and always stood ready to help when we were called upon by the markets to do so, as we occasionally were, intervening on our own initiative only to ensure that the public interest was properly respected. For the most part we took the view that market participants know better than we do what will work and what won't; it is after all their salaries if not their jobs that are on the line. Where public policy issues were involved, we established a tradition of extensive consultation right across the relevant sections of the market - a tradition which the FSA has certainly maintained. In the UK's relatively well-developed markets - particularly the wholesale markets - we recognised early on that where intervention was judged to be necessary - in the interest of market transparency or of prudential or behavioural conduct for example - it needed to be informed by those who properly understood the subtleties of the market if we were to reduce the risk of unforeseen consequences which could either frustrate the purpose of the intervention or unnecessarily obstruct market innovation. In some instances this approach, which I suppose might be described as market-sensitive, involved encouraging the market itself to address the particular issue in question as a preferable alternative to official action.

However, monetary policy will do its part to ensure the macroeconomic and financial stability that can help in achieving progress in these areas. Moreover, even with respect to macroeconomic stability, monetary policy could use an assist from fiscal policy. It is important that monetary policy and fiscal policy work together and not at cross purposes to be able to bolster the economy when it needs support. Thank you for your kind attention. I would be happy to take a few questions. 1 See New York City’s Return from the Brink, Remarks at the Lotos Club, October 19, 2016. 2 Raj Chetty, Nathaniel Hendren, Patrick Kline and Emmanuel Saez. “Where is the Land of Opportunity? The  Geography of Intergenerational Mobility in the United States.” Quarterly Journal of Economics, Vol. 129, No. 4, 2014. 6/6  BIS central bankers' speeches
The stage was therefore set for the floodgates to open and private consumption to come gushing back as soon as public health measures were lifted early in 2022 and consumers had an opportunity to exercise their purchasing power. The objective of all economic policy is to maintain equilibrium in the domestic economy, to ensure that there is "neither too little nor too much", to paraphrase Thorbjørn Egner's When the Robbers Came to Cardamom Town. During the pandemic, economic policy leaders had to take on the biggest contraction in output since the end of World War II, followed by an abrupt turnaround and a torrent of demand together with an unexpected jump in import prices. The first half of the job keeping the economy up and running during a deep downturn - went well. But the second half - restoring equilibrium after the pandemic - is turning out far trickier. The surge in inflation that followed the pandemic took the world's central banks by surprise. Early on, there was talk of a temporary adjustment - inflation would evaporate, and quickly, too. That proved to be wishful thinking. On that front, Russia's invasion of Ukraine - with the associated surge in commodity, fuel, and food prices and disruption of supply chains - had a serious impact. The unfortunate fact is that inflation has hit double-digit levels in many parts of Europe. Every central bank on the continent is still in a monetary tightening phase.

We live in a small open economy and are forced to import inflation through our purchases of necessities from abroad. Because of this, we must trust that our trading partners will take decisive action to bring inflation down within their own borders. Iceland is now reaping the rewards of the ironbound policy formulated during its reconstruction following the 2008 financial crisis - a policy that insisted on a secure financial system with strong lines of defence against external instability. Icelandic banks have extraordinarily strong capital in historical and international context, and they are under close financial supervision. Moreover, the news from abroad confirms that merging the Central Bank and the Financial Supervisory Authority back together at the beginning of 2020 was the right decision. The merger and, in particular, the increased power the Bank has been granted in the area of financial stability have been of vital importance in ensuring that the current fluctuations in demand, interest rates, and financial conditions do not give rise to a credit bubble or excessive risk-taking in the financial sector. Iceland carries very little household, corporate, or government debt in comparison with other countries. It is clear that these conditions provide monetary policy with full flexibility to act. There are no handcuffs here. Honoured guests: I don't know whether any of you have gotten lost in the fog, found yourselves going around in circles, and been convinced that water flows upstream. I have never gotten lost in the Icelandic outback, but I have often done so in foreign megacities.
Sri Lanka, India and Iran have completed their Stage I payment reforms. Pakistan is in the process of completing Stage I, while the other SAARC countries are now taking steps to modernize their payment systems. The maintenance of a safe, sound and efficient payment system is a responsibility of the central bank as many of our central banks have increased focus on wider financial system stability as one of their core objectives. In that context, central banks are called upon to coordinate payment initiatives at national, regional and global levels to ensure that there are appropriate mechanisms for smooth payment flows. 2. Why payment systems are critical to regional development? Payment services are highly integrated and interdependent systems comprising payers, payees, payment instruments, financial intermediaries, markets, service providers, technical infrastructure, legal and regulatory systems and organizational structures. The public policy objectives common to all stakeholders are to enhance public confidence, safety, integrity, access to finance and efficiency of payment systems. Therefore, we need to facilitate cross border trade and investment flows through appropriate payment instruments, clearing mechanisms and settlement systems. In a globalized and highly integrated world, financial sector development is closely associated with cross border flows, including foreign direct investment which is critical to developing economies. Most of us in the SAARC region are FDI recipients.

The Central Bank has pointed out how the small amount of outstanding Treasury bonds in the market hinders policy rate changes from being transmitted with the necessary weight. Price formation in the bond market is imperfect. The Bank has aired the idea that the Treasury should issue bonds with the explicit purpose of maintaining an active bond market. Of course, such a suggestion must be qualified by the fact that the Treasury is on the verge of eliminating its net debt and has no need to borrow. The Central Bank’s standpoint, however, is that given the significance of domestic capital markets, the importance of facilitating the impact of monetary policy measures and long-term strategies for Treasury funding, it is in the Treasury’s interest to maintain a smooth bond market, even though it has no direct funding requirement. One example of Treasury issuance on such principles is Norway, which has had even less need to borrow than the Icelandic government. Claims have been heard that the Central Bank’s monetary policy is either impotent or wrong, and that the Icelandic króna is the root of macroeconomic instability. The Central Bank has pointed out that one consequence of globalisation and Iceland’s integration with global capital markets, coupled with the exceptionally intense upswing experienced in recent years, has been that the transmission mechanism of monetary policy has altered. In this climate, the impact is transmitted with greater force to the exchange rate, and only later to domestic demand, as I mentioned earlier.
**  2003 average until November 2003. *  Almost all the 2003 data are forecasts. Source: INSTAT, Ministry of Finances, Bank of Albania and IMF estimations. *** As a conclusion, I would like to underline once again that the Bank of Albania does not make its policy decisions separately, but following carefully all the developments of the economy, and this is really important for the public to understand. As it is now a tradition, the monetary policy of the Bank of Albania is part of the general economic development program of the country. As such, it can’t be but a range of decisions and measures, which in good harmony with the other policies, the fiscal one, etc.,  2  BIS Review 8/2004  aim at economy growth and reduction of the poverty in the country. The coordination of monetary and fiscal policies could be achieved in the mid-term development program of the country, a program covering a three-year time span. The extensive logic of this program gives a crucial importance to keeping up macroeconomic stability. Keeping up macroeconomic stability serves as a bridging gap between the monetary policy and the fiscal one. Hence, the monetary policy is committed in keeping up price stability, whereas the fiscal one controls the budget deficit. These macroeconomic indicators are strongly related to one another: fulfilling each of them requires, as a basic condition, the observance of the other objectives.

Today, I would like to focus my remarks on three important shifts that I believe will underpin innovative risk management practices going forward. · First is the changing role and focus of risk managers in supporting business decisionmaking. ·  Second, is a shift from risk measures to risk narratives. · And third is an increasing emphasis on building resilience alongside the prevailing focus on averting risks. Changing role of risk managers One of the most important changes that corporations can make to strengthen risk management is to appropriately position the risk function to effectively support enhanced business decision making. An effective risk management function should interact with other business functions to deliver value. This itself is hardly an innovative idea. But you would be surprised (or maybe not) to learn that despite an increasing involvement of risk managers in business decision-making, poor alignment between decisions that are taken by business leaders, and the intentions of senior management and the board, continue to persist in many organisations. A common reason for this is the absence of, or a poorly defined risk appetite framework. And very few organisations, if any, have gone further to articulate their risk appetite for managing innovation specifically. This has important implications for risk managers. We cannot expect risk managers to be very helpful to business leaders who have explicit growth and revenue targets to meet, if risk managers are not themselves guided by a risk appetite that is equally well-defined.
Targeted measures include: –  limits on high Loan-to-Income mortgages introduced last year, which contributed to the share of households with very high mortgage debt to income ratios falling back to levels last seen in the 1990s (Chart 4);2  –  requirements for banks to assess whether borrowers could still afford their mortgages at much higher levels of Bank Rate; and  –  the current review of underwriting standards for Buy-to-Let being conducted by the Bank’s prudential supervisors.3  Chart 4: FPC action capped share of new mortgages that can be originated at above 4 ½ times income  Risk scenario  0  1  Per cent of new loans  After FPC action  2  3  4  5  Loan to income (LTI) Sources: FCA Product Sales Data and Bank calculations. The risk scenario considered how the distribution of LTIs of new loans might have might evolved if momentum in the housing market had continued to build from mid2014 in a way that was similar to the patterns seen in the UK housing market in the early 2000s.After FPC action line pertains to 2014Q4 – 2015Q3. In addition, given the financial system has moved out of the post-crisis period of heightened risk aversion, the FPC has made clear its intention to set the Countercyclical Capital Buffer above zero before the level of risk becomes elevated. With active macroprudential policy, monetary policy can focus on its primary job of inflation control. It is that to which I will now turn.

These concepts are echoed in the various principles that follow, which highlight more specific recommendations based upon the roles market participants take on and the types of transactions in which they engage. Labels aside, the fundamental recommendations regarding roles recognize the importance of clear communication of roles, the importance of fairness and the strong expectation that discretion not be used in a manner designed to disadvantage a client. Clarity of terminology was again important during the development of Principle 11 on prehedging. The Code is very specific in how it describes pre-hedging. It is defined as “the management of the risk associated with one or more anticipated client orders, designed to benefit the client in connection with such orders and any resulting transactions.” The principle then lays out circumstances in which such pre-hedging may or may not be appropriate. 2/6  BIS central bankers' speeches  The principles on information sharing cover topics where there had seemed to be a lack of clarity within the market. The principles emphasize the importance of appropriately identifying and managing confidential information. They describe what may constitute confidential information and when such information should or should not be shared and with whom. They also provide guidance as to how market participants might communicate market color appropriately and, critically, without compromising confidential information. It is important to recognize that the FX market is not entirely about trading and execution—risk management, compliance, and confirmation and settlement are central to FX transactions, and they comprise the final two sections of the Code.
Aside from a single currency and a fiscal brake, EMU’s institutional architecture was minimalist: governance of economic and financial policies remained firmly a national competence. What lay behind these expectations? Of course, political considerations were a dominant factor, insofar as governments had incentives to limit the centralisation of fiscal, economic  BIS central bankers’ speeches  1  and financial policies. But to an extent, it also reflected the economic thinking that prevailed at that time. The rational expectations, perfect foresight paradigm was – and to a large extent still is – dominant. Many of its followers are, of course, aware of its limitations but hope to successfully expand the theory to encompass new aspects of reality. Standard models feature unboundedly rational agents and complete knowledge of all variables’ probability distributions in all possible future states of the world. They do not foresee significant credit cycles or irrational asset price bubbles. Moreover, information is fully symmetric and complete state-contingent contracts can be written and enforced. Default – a situation in which debtors cannot repay due debt in some states of the world – was also ruled out. The optimal lending contracts in such an environment do not even resemble a debt contract. Agents use so-called “Arrow-Debreu” securities. The set-up allows a different payback for every future eventuality so that borrowers are always able to meet due repayments.

The ECB is taking measures to ensure the proper transmission of its monetary policy and maintain price stability, which buys time for this adjustment to continue. Completing the euro area’s institutional architecture To stabilise EMU over the long-term, however, requires a more fundamental reform of the institutional architecture. The minimalist approach pursued at Maastricht was found to be inadequate in the context of highly integrated financial markets. In recognition of this, the Presidents of the European Council, Commission, Eurogroup and ECB have been asked to lay out a roadmap to complete EMU over the next decade. They presented their interim report to the European Council in July and will present a final version in December This Report does not aim to identify what features we would ideally like for the euro area, but rather what features it cannot do without. Having been thoroughly stress-tested over the last three years, we now have a much clearer idea of what rules and institutions are essential for monetary union to function effectively. In the view of the Four Presidents, a stable EMU needs to be built on four pillars: financial union, fiscal union, economic union and political union. Let me explain each in turn. Financial union The first and most urgent pillar is financial union or, as it is more commonly known, banking union.
We cannot rely too much on regulation alone to make finance safer. As Jacques de Larosiere reminds us: “Strong, intrusive supervision as well as careful risk assessment and management by bankers are of the essence. They will never be replaced by rules.” Put differently, a culture of prudence and risk governance is a better guarantee of safety and soundness than all the rules on capital and liquidity that we can draw up. Finally, we want finance that is not only safe but also purposeful. Regulation must not seek to eliminate all risk and must be impact-sensitive. Let us not lose sight of the bigger picture: a sound financial system that is able to play its vital role of intermediation, to support sustained economic growth and help create opportunities for individuals and enterprises. Thank you. BIS central bankers’ speeches  7

This is worrying, because misconduct erodes trust in the system. If investors, depositors and policy holders stop believing that their interests are being safeguarded, the entire system quickly comes unraveled at significant costs to society. These costs can arise from failures of financial institutions, a misallocation of economic resources, or simply steep fines that destroy shareholder value and employment prospects for affected workers. Since the global financial crisis, banks have paid more than USD320 billion in fines and legal costs and have been the subject of numerous Government financial inquiries due to misconduct. In Malaysia, in the last 5 years, Bank Negara Malaysia has imposed fines on financial services providers to the tune of RM116 million. A survey conducted by the Bank revealed that almost twothirds of reported losses by banks in 2016 were associated with internal fraud, regulatory noncompliance and operational lapses. We have examined these incidents in some depth. Our observations lead us to conclude that behaviour is very much influenced bycontextual factors such as organisational values, incentives and management responses to misconduct or non-compliance. The rightcontextual setting can exert a powerful influence on individual behaviour. We believe this begins with setting and clearly communicating expectations of desired behaviour. Without clarity on what is acceptable in the first place, it would not be possible to encourage, much less enforce, these expectations. The FSPB serves an important role in this regard through its work in defining and developing codes of behaviour for financial institutions.