samchain/econo-pairs-v1 huggingface dataset:
European Central Bank: Press conference – introductory statement Introductory statement by Mr Jean-Claude Trichet, President of the European Central Bank, and Mr Vítor Constâncio, Vice-President of the European Central Bank, Frankfurt am Main, 13 January 2011. *  *  *  Ladies and gentlemen, the Vice-President and I are very pleased to welcome you to our press conference. Let me wish you all a very Happy New Year. I would also like to take this opportunity to welcome Estonia as the seventeenth country to adopt the euro as its currency. Accordingly, Mr Lipstok, the Governor of Eesti Pank, became a member of the Governing Council on 1 January 2011. Following the adoption of the euro by Estonia there are now 331 million citizens using the euro as their currency. We will now report on the outcome of today’s meeting, which was also attended by Commissioner Rehn. Based on its regular economic and monetary analyses, the Governing Council confirmed that the current key ECB interest rates still remain appropriate. It therefore decided to leave them unchanged. Taking into account all the new information and analyses which have become available since our meeting on 2 December 2010, we see evidence of short-term upward pressure on overall inflation, mainly owing to energy prices, but this has not so far affected our assessment that price developments will remain in line with price stability over the policy-relevant horizon. At the same time, very close monitoring is warranted.

At the same time, and particularly taking into account the relatively high level of business confidence in the euro area, private sector domestic demand should increasingly contribute to growth, supported by the accommodative monetary policy stance and the measures adopted to restore the functioning of the financial system. However, the recovery in activity is expected to be dampened by the process of balance sheet adjustment in various sectors. In the Governing Council’s assessment, the risks to this economic outlook are still slightly tilted to the downside, with uncertainty remaining elevated. On the one hand, global trade may continue to grow more rapidly than expected, thereby supporting euro area exports. Moreover, strong business confidence could provide more support to domestic economic activity in the euro area than is currently expected. On the other hand, downside risks relate to the tensions in some segments of the financial markets and their potential spillover to the euro area real economy. Further downside risks relate to renewed increases in oil and other  BIS central bankers’ speeches  1  commodity prices, protectionist pressures and the possibility of a disorderly correction of global imbalances. With regard to price developments, euro area annual HICP inflation was 2.2% in December, according to Eurostat’s flash estimate, after 1.9% in November. This was somewhat higher than expected and largely reflects higher energy prices. Looking ahead to the next few months, inflation rates could temporarily increase further.
François Villeroy de Galhau: Special address on the French National Strategy for Financial Education Speech by Mr François Villeroy de Galhau, Governor of the Bank of France, at the 4th OECD/GFLEC global policy research symposium to advance financial literacy "Addressing the needs of youth", Paris, 24 May 2017. * * * Accompanying slides. Your Highness (Queen Máxima of the Netherlands), Mr. Secretary General, ladies and gentlemen, I am delighted to be here with you today for this symposium on financial literacy. Indeed, French citizens have high expectations about financial education: [slide 2] 78% believe that financial literacy should be taught at school and 65% believe that access to it would reduce overindebtedness and financial vulnerability.1 Academic research by Annamaria Lusardi and Olivia Mitchell2 confirms its importance, as does our own research in France3 [slide 3]. If we consider the three "standard" questions used to assess awareness of interest rates, inflation and risk diversification, only 30% of those surveyed answered all three questions correctly, which is lower than in other European countries. Furthermore, in France some of the worst results were obtained by the youngest age group, as well as the oldest. However, there is more at stake: this represents a challenge for democracy. Providing our fellow citizens with the keys to understanding complex economic debates is a matter of respect.

BIS Review 137/2010  5  Nevertheless, several risks to home prices in the City remain. These risks include the ongoing completion of a considerable number of new apartment buildings – ones that were started at the end of the boom. Another risk comes from the slow pace of job growth in highpay sectors (including the securities industry) in New York City. Finally, during the boom, prices rose substantially faster than rents. Going forward, this disparity could exert downward pressure on home prices as renting has become a more affordable alternative. Conclusion In sum, after a recession that was milder than in many parts of the country, the region is showing signs of a modest recovery in New York, but little growth elsewhere. The housing sector played a pivotal role in the recent national downturn. In the region, the fact that housing activity has a smaller weight in the regional economy helped to limit the recession’s impact on many communities. Going forward, given housing’s significance to the well-being of people in our region and beyond, the New York Fed will continue to focus on the sector as we monitor regional and national economic conditions. Thank you for your kind attention. I will now ask James Orr to provide more details on current regional economic conditions. 6  BIS Review 137/2010
While we might have been somewhat surprised by the number of responses that we received, we were not surprised by the hard work that was evident in the letters. On this note, I would like to offer the Committee’s appreciation to the banks, banking associations, including the members of the IIF, and public agencies in Asia and elsewhere that devoted considerable time and resources to the consultations. If you’ve been following our work since the first consultative paper was released in 1999, you know that the proposals have evolved and improved considerably thanks to the honest responses and letters that you and others shared with us. At the Committee’s meeting last month, all members acknowledged our responsibility to consider carefully all comments. At the same time, we recognised the need to resolve the open issues and release the New Accord as soon as possible so that banks can continue to prepare for the new rules. In a statement to the press after our meeting, the members of the Committee noted that we expect to take account of the remaining issues and complete the text of the New Accord in the coming months and not later than mid-year 2004. Let me briefly mention some of the issues present in the comment letters. Complexity and the balance with risk sensitivity and comparability Certainly a key issue that we are addressing is balancing the complexity of the agreement with the need to be sensitive to risk and to offer different kinds of banks comparable approaches.

First, Regtech benefits banks: In today’s sessions, banking leaders have told us how Regtech is important to their institutions. It enables banks to achieve higher quality risk management and compliance outcomes. It reduces costs. It frees up staff from repetitive manual tasks for more value-adding work. The use of Cloud-based Regtech technology, for example, gives banks the flexibility to adapt to changes in regulation and risk management, while maintaining superb quality in risk management and compliance activities. 6. Secondly, Regtech benefits customers: In our “Path Forward” panel, Mr Deniz Güven from Mox Bank spoke of how Regtech had significantly speeded up the bank’s end-to-end account opening process. Mr Victor Lam also cited how iAM Smart, a personalised digital services platform in Hong Kong, can support Regtech use cases such as remote onboarding. That was echoed by Mr Tat Lee of WeLab Bank and Mr Werner Schlossmacher of Credit Suisse in the “Pulse of Regtech” session. They talked about how banks can leverage alternative datasets to improve the loan application process and enhance the evaluation of product suitability. We also heard how they have designed solutions that put customer experience at the centre – by respecting customer needs, eliminating duplication, offering the most suitable products and, most importantly, keeping customers protected. The use cases discussed in those sessions showed that Regtech offers exciting opportunities that go beyond a compliance tick-box exercise and greatly improve customer experience and satisfaction. 7.
Yet efficient market forces “should” eliminate these disequilibria by having wages adjust to ensure full employment always and forever. Monetary Policy is not only a response to these rigidities; it is made effective by them. In capital markets, there is ‘momentum everywhere’. From bonds to equities to currencies and commodities, past winners seem to enjoy further winning streaks, while past losers persist in trailing behind. 4 Yet efficient market forces ‘should’ eliminate these predictable movements before they become apparent. *** The belief that markets always clear had two dangerous consequences. 5 First, if markets always clear, they can be assumed to be in equilibrium; or said differently “to be always right.” If the received wisdom is that the market is efficient, then bubbles can neither be identified nor their potential causes addressed. Such thinking dominated the (non)reaction to US subprime and housing booms. Consider that many market participants find it more profitable to anticipate each other’s behaviour than to divine the fundamentals. 3  For a review of this broader phenomenon, see Padoa-Schioppa, T (2010), “Markets and government before, during and after the 2007-20xx crisis”, The Per Jacobsson Lecture, June. 4  Asness, C, Moscowitz, T and Pedersen, L (2013), “Value and momentum everywhere”, Journal of Finance, LXVIII, No. 3, June. 5  See also Turner, A (2010), “Market efficiency and rationality: why financial markets are different”, Lionel Robbins Memorial Lectures, London School of Economics.

How can these risks best be mitigated in practice? Let me comment on the range of possible options that stop short of direct regulation. Prudential regulations, in the form of capital or leverage requirements, have not been considered a necessary or desirable step to date within the official sector in the United States, and are not on the horizon. Investors in hedge funds have a compelling direct interest in ensuring they are well managed. A more discerning and pro-active approach by investors in hedge funds should help to reduce the risk of failure by a major fund. The increasing share of institutional money allocated to hedge funds and the growing role of funds of funds could help reinforce the ability of the investor class to provide such market discipline, in particular if these types of investors undertake more extensive due diligence. There has been and continues to be a lot of interest in inducing or requiring hedge funds to disclose information that would make it possible to know more about the scale of leverage in particular funds, the risk of concentrated positions that could amplify volatility if unwound quickly, and other aspects of the risk profile of the fund. These efforts are motivated in part by discomfort about what we do not now know and a sense that knowledge itself, by reducing uncertainty, could reduce risks.
Evidently, we must shorten the transition as far as possible, so that banks are aware with sufficient certainty of the supervisor’s requirements in the short and medium term and can, in this way, effectively design their strategic and management measures. True, this objective is currently hampered by the still-unstable international regulatory framework. I trust the Basel Committee’s announced intention in its recent report to the G20 to see through the regulatory reform next year will be fulfilled. In any event, in the supervisory realm we must make further efforts to specify with greater precision and permanence the solvency requirements for each bank based on its risk profile, and to establish certain clear guidelines on the application of restrictions on the remuneration of capital instruments and on directors’ variable remuneration. At the same time, as I previously pointed out, we must continue to work on the convergence of supervisory practices, moving towards better standards, and on smoothing the differences that still persist across the different SSM jurisdictions. For example, while some national authorities have traditionally focused on reviewing management procedures, others have placed particular emphasis on reviewing the classification and valuation of assets on financial statements. These differences in supervisory practices involve, in turn, heterogeneity in the professional profile of the employees of the various authorities now sharing missions within the SSM.

There will be winners and losers internationally but also within countries. This calls for a deeper international cooperation which will promote a globally fair transition to a low-carbon economy. And each and every one of us – civil society; States and regional regulators; academics, NGO’s and think-tanks; corporates and financial institutions; central banks, supervisors and standard setters – has a part to play: it is a shared challenge that no one can tackle alone. We should also focus our efforts and attention on emerging countries and developing economies. They are usually hit harder by climate risks and on top of that also face environmental risks at large, (such as air pollution, water pollution and scarcity of fresh water, land contamination, harming biodiversity and deforestation). In 2017 alone, almost 5 million people worldwide died due to air pollution. Even if environmental degradation and associated (financial) risks are often more local in their reach, there are nevertheless compelling reasons for the NGFS to look at environmental risks relevant to the financial system and differentiate more in the recommendations provided between the types of financial systems. Conclusion: The success of the Paris Agreement will depend on our ability to move forward in an inclusive manner. The world is in the hands of all of us. But certainly some have a greater influence on its fate than others. Central banks and supervisors, within the NGFS and alongside men and women of good will, are playing their part in mitigating the disruption caused by climate change.
But based on the rapid pace of developments since we published our May forecasts and the shift in the balance of risks I can envisage those conditions for considering tightening being met somewhat sooner than I had previously expected. That reflects my current assessment that on balance I put more weight on my inflationary than my disinflationary scenario. But there should no presumption that the recent strength in demand and inflation will be sustained, and while I do currently put less weight on my disinflationary scenario, it is too early to rule it out. Along with the rest of the MPC I will continue to watch the data and newsflow closely. As and when conditions for considering tightening are met there is also the question of how we might tighten policy. The monetary policy toolbox has come a long way since the days when it contained a single tool, the  13  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  13  Bank Rate.6 As the terrain has got more complicated to navigate, the tools have become broader in range and more complex, including Bank Rate, forward guidance and asset purchases. Indeed as things stand we have an asset purchase programme in progress which is not due to complete until the end of the year.

Starting with my first consideration, whether recent strength proves persistent or temporary. Even absent a further impact from Covid, it is unlikely that the current pace of GDP growth can be sustained for much longer. Indeed if current strength represents a bringing-forward of the recovery that we had expected later in the year, then subsequent growth might if anything be expected to be weaker rather than stronger. The very latest indicators suggest the pace of underlying demand growth may indeed be slightly moderating, though as I mentioned previously the read from the latest GDP data itself is clouded by supply constraints. But there are certainly upside risks to household spending, if consumer confidence continues to rise or if households run down their accumulated aggregate savings faster than we have assumed. The current strength in the housing market is suggestive in this regard, both as a potential indicator of household confidence and due to the consumption of things like durable goods that goes alongside housing transactions. One of the early legacies of the pandemic appears to be an increase in the number of people taking advantage of the ability to work more remotely and moving house for lifestyle reasons, a trend which I think could be sustained for some time; like many of the long-term effects of Covid, that is likely to have differential impacts within regions and in different parts of the country.
12  BIS central bankers’ speeches  Chart 5 Cross-border equity holdings (1980–2005) 1980  1985  1990  1995  2000  2005  Source: Kubelec and Sa (2010) and Bank calculations. Advanced economies  Emerging market economies  Financial centres (Hong Kong and Singapore)  Notes: Widths of links are proportional to the log dollar value of cross-border equity holdings. Each arrow denotes ownership, with the arrow pointing away from the holder of the equity and toward the issuer. Sizes of nodes are proportional to the log dollar value of the sum of all of the country’s cross-border equity holdings and liabilities issued (i.e. equal to the sum of incoming and outgoing links). BIS central bankers’ speeches  13  Chart 6 Country shares of world equity market capitalisation (1995–2010) 1995  2000  China  India  China  India  Other emerging G20  US  Other emerging G20  US  Other advanced G20  Non-G20  Other advanced G20  Non-G20  2005  2010  China  India  China  India  Other emerging G20  US  Other emerging G20  US  Non-G20  Other advanced G20  Non-G20  Other advanced G20  Source: Thomson Reuters Datastream. Note: “World equity market capitalisation” aggregates the US dollar measures of local equity market capitalisation. Chinese equity market capitalisation includes A, B and H shares. Russian equity market capitalisation not available prior to 1999. Data unavailable for Saudi Arabia.

Gross portfolio equity inflows to emerging markets surged as investors substituted out of low growth developed markets (Chart 1). Gross equity inflows to certain emerging markets were large relative to domestic market capitalisation (Chart 2). The resulting indigestion problem caused bubbly behaviour in emerging asset markets. In response, a number of countries have thrown grit in the wheels of finance through macro-prudential measures or capital flow restrictions. These surges in foreign capital flows, and associated asset market spillovers, are far from new. Through this century, a new wave of inflows to emerging markets has been building. Although halted temporarily by the financial crisis, its effect has been to buoy emerging asset prices (Chart 3). Earlier centuries have seen many similar episodes of capital flow surges into emerging markets, from the South Sea bubble in 1720 to the East Asian crisis of the 1990s (Reinhart and Rogoff (2008)). Historically, as these waves have broken they have often caused quite a splash, with sharp capital and asset price reversals (IMF (2011)). Some commentators have called those capital reversals “sudden stops” (Dornbusch, Goldfajn and Valdés (1995)). But the underlying problem may be as much the start as the stop. The seeds of emerging market crises are sown in the build-up phase, as inflows dwarf the absorptive capacity of recipient countries’ capital markets. Capturing that dynamic requires a different metaphor – the “Big Fish Small Pond” (BFSP) problem. The Big Fish here are the large capital-exporting, advanced countries.
In particular, it’s self-evident that central bankers need some way of judging the degree of slack in the economy and its effect on prices. If there are either ample underused resources or binding capacity constraints, monetary policy may need to respond pre-emptively. But the concept of the output gap becomes less useful, in my view, if it morphs from being a broad signpost for policy into a de facto intermediate target for policy. If policymakers start to believe that they can steer the output gap towards zero – effectively, to “fine-tune” policy in order to achieve that – they are liable to come unstuck. And our recent experience in the euro area, coupled with my assessment of how the economy is evolving, only reinforces that view. There are three main reasons why I say this. The first is that estimating the output gap in real time is fraught with uncertainty, and the misleading signals this can give to policymakers have been painfully exposed by the crisis. In 2007, real time estimates from a range of international institutions – the European Commission, the IMF, the OECD – envisaged the euro area output gap at that time to be in the range of minus 0.6% to minus –0.2%. According to the most recent estimates, however, we now think that the euro area output gap in 2007 was in the range of plus 2.6% to 3.3%. This shows how wrong real-time estimates can be.

What is clear however is that we have to overhaul our traditional ways of measuring, assessing and reacting to productivity and welfare indicators. Socially, uncertainty will weigh heavily on people’s shoulders in the years to come amid these structural changes. How should policymakers react? The fact that our established gauges have lost their assumed precision does not mean that we have become clueless. In spite of the elevated uncertainty, it is still possible to grasp the obvious. Potential output may not the most reliable benchmark in the current environment. Moreover, perhaps it misses the broader structural changes, which are of paramount importance in the longer run pursuit of improvements in standards of living. So it is crucial that policy makers pay heed to broad and thorough analyses, coupled with an understanding of the limitations to our understanding we face at this time. In this way, modest judgment and prudent action will provide the indispensable preconditions for policymakers to live up to their responsibilities. 6  BIS central bankers’ speeches