samchain/econo-pairs-v1 huggingface dataset:
In Singapore, this is much less prevalent. If we can make it easier for our women to return to the workforce after they have had their children, we can narrow the gender gap vis-à-vis the advanced economies. This slide demonstrates another thought experiment: assume we narrow our gender gap from the current 15% points to 11% points by 2035 – approximately the level seen in Germany and Netherlands. This will only translate into a cumulative labour force increase of about 2% in 2035. 7 / 17  BIS central bankers' speeches  The demographic trilemma presents the constraints and choices facing us. We can soften it by raising the TFR and LFPR. Of course, having babies or returning to work are deeply personal choices. No one makes these choices in order to boost labour force growth or GDP growth, and we should not suggest doing so. The Government tries to facilitate fertility and labour force participation because that is what many people desire for their own fulfilment. Many women would like to return to work, but they face a number of constraints. We must make it easier for them to do so. The government has made significant efforts in recent years to invest in childcare and facilitate more flexible working arrangements. We must continue to push on this front and collectively as a society enable more who want to work enter the workforce.

Investment has begun to rise, albeit at a slightly later stage than we had assumed. However, it is unlikely that the problem of a low investment rate now is connected to interest rates being too high. Given the low interest rates we see now and the good access to credit in the financial system, financing costs can hardly be regarded as a factor holding back investment. With regard to households, it is possible that even lower interest rates could make them increase their debt burden and borrow in order to increase consumption, but to me this is not an obvious conclusion. In addition, there are risks here. This brings me onto the question of how households have reacted to the low inflation and low interest rates, and this issue deserves more detailed discussion. Households’ growing debt burden and rising house prices In recent years, households’ debt burden has increased gradually and now amounts on average to 125 per cent of their annual disposable income, which is almost as high as immediately prior to the property crisis in 1992. However, interest payments are now less than half what they were then, approximately 4 per cent of disposable income. The fact that households are loaning at an increasing rate, both in Sweden and many other countries, can be regarded partly as an adjustment to lower inflation, which is also expected to be permanent.
Still, this characterization is based on very crude generalizations; in reality, EMEs spread over a broad range of possibilities for each dimension and different combinations of them. The question is then to what extent does such variety of cases make a difference for the spillover from changes in global financial conditions and what role does the exchange rate (ER) play in it. How important are global financial and business cycles to EMEs compared to local ones? To address this issue from an EME’s perspective, a first question refers to the relative importance of externally-induced shocks as compared to purely domestic ones. Even if the Global Financial Cycle were a very powerful force, as long as countries can still get into troubles of their own, macro policy, including the ER regime, may make an important difference. A review of the last 40 years of economic history reveals many episodes during which cyclical turning points originated in domestic, rather than foreign, shocks. In Latin America in particular, many of the major shocks of the 1980s, 1990s, and early 2000s originated locally, usually from misconceived policies, private sector exuberance, or inadequate regulations. The fact that these shocks showed up as large current account deficits surely reflects the degree of dependence of governments and business on external funding, but that does not exempt local conditions from being the main source of the imbalances.

In particular, a classical Latin American and Caribbean countries (LAC) crisis would show up as an unsustainable disequilibrium between public, private, or foreign savings and investment partially contained by some form of FX control, which turns into a major economic and financial crisis once the currency devaluates. Abundant foreign capital may help prolong the situation for a while, but only to make the inevitable turnaround more damaging. It is important to underscore the role of domestic ER policies. During the upswing, central banks in EMEs often try to curb the resulting appreciation, either through outright currency fixation of heavy FX market intervention. As a number of recent papers have found, these policies tend to reinforce capital flows. 1 When the tide turns, however, these rigid ER regimes are often accompanied by large devaluations, which contribute substantially to insolvency problems in both real and financial domestic sectors. Global financial conditions may thus influence the timing or even the intensity of a domesticallyinduced crisis, but they cannot suppress it altogether. Moreover, such favorable financial conditions usually hit back with a vengeance once local weaknesses reveal themselves. From here we can conclude that appropriate macro policies are necessary to prevent locally-induced cycles, even when powerful global financial forces are at play. The transmission of Global Financial Cycles to EMEs and the role of ER regimes 1  See Maurice Obstfeld, Jonathan D. Ostry, and Mahvash S. Qureshi (2018), “Global Financial Cycles and the Exchange Rate Regime: A Perspective from Emerging Markets,” Discussion Paper #12696, Centre for Economic Policy Research.
Traditional broker-dealers generally carry net long or short positions in Treasury securities from one day to another, an activity that requires capital. Dealers hold Treasuries for a variety of reasons, including to support the liquidity needs of their customers, to hedge exposure in other fixed-income products, and to meet their obligations as primary dealers to participate in U.S. Treasury auctions and the Federal Reserve’s open market operations. Many argue that the ability and willingness of dealers to  7  A CLOB protocol aggregates all executable bids and offers across participating liquidity providers in a single order book that is available to all market participants. In a liquid market, the continuous visibility of quotes and the interaction of multiple bids and offers are likely to enhance the price discovery process and market transparency. In contrast, a request-for-quote protocol, where a request for liquidity typically is submitted to only a limited set of providers, by its nature imposes a degree of market segmentation that may impede the price discovery process as compared with a CLOB protocol, but is arguably better suited to handle large block trades and illiquid securities. 8  Momentum detection is a strategy that attempts to predict short-run price changes based on patterns in realtime market data. Statistical arbitrage is a trading strategy that typically relies on identifying mean reversion from historical relative pricing relationships between correlated assets. Spread trading seeks to profit from a simultaneous purchase and sale of two closely related fixed-income assets.

BIS central bankers’ speeches  7  October 15 also raises questions about the nature of liquidity in the Treasury market today. As I mentioned earlier, market liquidity is a difficult concept to pin down, and if one asks how liquidity evolved on October 15, the answer will differ depending on the measure of market liquidity you have in mind. It is certainly the case that some frequently-cited metrics of liquidity, such as the quantity of orders available for execution in the CLOB at a given point in time, often referred to as “market depth,” showed significant signs of strain that morning. But volatility was also elevated, so a coincident reduction in market depth may be unsurprising. Indeed, an increase in volatility and reduction in depth can work in a self-reinforcing manner, in which reduced depth causes trades to have a greater price impact, while the resultant volatility causes market depth to shrink further. This dynamic has always existed in markets, but it is possible that automated trading serves to exacerbate it in certain situations. But even if a sharp reduction in market depth makes sense given an increase in volatility, a trade of reasonable size would have been more expensive for a customer to execute in the event window, and would have had a greater price impact, than in more normal conditions. In this sense, liquidity was challenged, and frequent periods of strained liquidity would be undesirable for the most liquid sovereign debt market in the world.
Under the floating exchange rate regime, the Sri Lankan currency can no longer be regarded as a steadily and continuously depreciating currency. With the maturing domestic foreign exchange market, the exchange rate is now more responsive to, and determined through, market forces of supply and demand, while the intervention by the Central Bank is limited to mitigate excessive volatility in the market and to build up official external reserves. The stabilization of the Sri Lanka rupee utmost underlines the need for the export and import competing sectors to focus more on productivity improvements and market access in order to maintain external competitiveness. Instead of waiting for the exchange rate to depreciate and then for our businesses to become competitive, it is time for all of us to improve our productivity in whatever manner we can. The garment sector, I hear is trying to gain from higher productivity and also through cost efficiencies. How does inflation and productivity affect each other? Increased productivity is an important prerequisite to achieve low and stable inflation levels in the long-run. The lower productivity allows cost increases that flow through to product prices and thereby raises inflation. Therefore, the lower productivity growth thus represents a negative supply shock that generates inflationary pressures. In such context, it is necessary to pay due attention to improving the productivity in order to prevent potential inflationary pressure associated with high income arising from faster nominal growth and cost-push factors that raise the cost of production.

1  Directive 98/26/EC of the European Parliament and of the Council of 19 May 1998 on settlement finality in payment and securities settlement systems  2 Directive (EU) 2015/2366 of the European Parliament and of the Council of 25 November 2015 on payment  services in the internal market, amending Directives 2002/65/EC, 2009/110/EC and 2013/36/EU and Regulation (EU) No 1093/2010, and repealing Directive 2007/64/EC 3 Directive 2009/110/ЕC of the European Parliament and of the Council of 16 September 2009 on the taking up,  pursuit and prudential supervision of the business of electronic money institutions amending Directives 2005/60/EC and 2006/48/EC and repealing Directive 2000/46/EC  2/2  BIS central bankers' speeches
Technology may be set to change jobs and wages more fundamentally than in the past. Job displacement and creation may come thicker and faster than ever previously. “Hollowing out” may become more pervasive. And gaps between those with and without skills, or with and without jobs, may widen as never before. Or that, at least, is the picture some have painted. These issues have fundamental implications for the functioning of industries and economies and the well-being of families and societies. They also, of course, have fundamental implications for the TUC and for policymakers like me. So after reviewing labour market developments, historically and prospectively, I want to conclude with some reflections on policy, including monetary policy. Good news, bad news Let me start with a review of recent developments in the labour market. There is plenty of good news to report here, with a boom in jobs and, to a lesser extent, wages in the UK. Yesterday’s labour market data confirmed that picture. But there are also strong crosscurrents at work, often rooted in longer-term structural shifts in the labour market, which offer a more worrying window on the world of work. •  In the immediate aftermath of the global financial crisis, there were understandable fears that unemployment would rise rapidly. At the start of 2009, the Monetary Policy Committee (MPC) was forecasting that the UK unemployment rate would rise into double figures, equivalent to over the 3.4 million people.

AI uses the law of large numbers to solve problems and learn, sifting multiple permutations for a solution. All AI problems are, in effect, big data problems involving long strings of ones and zeros; they are digital. The brain, by contrast, is more analogue in its configuration, processing and problem-solving. Solutions are often condensed down to a small number of learned behaviours or heuristics. These differences become clear with a task such as learning a language. This is one where huge strides have been made by machines over the past decade (Pratt (2015)). That rapidlearning has not come from computers feasting on the classics like a college student. Rather, it has arisen from them devouring the whole library in one digital mouthful, then seeking matching patterns in the text and syntax. Language, paradoxically, has become a numbers not a words game. These different approaches to problem-solving are important when defining where humans may have the edge. This appears to be in tasks requiring high-level reasoning – large logical  BIS central bankers’ speeches  9  leaps of imagination rather than repeated small experimental steps. It is in tasks where the focus is on cognition and creativity, rather than production and perception. And it is activities where EQ trumps IQ1, where social capital is scored as or more highly than financial capital. To bring that down to planet earth, no-one anytime soon is I think going to choose a robot to cut their hair – I told you the hairdressers were safe.
For example, a higher deficit means an increase in the public debt of equal amount, and thus more annual interest to be paid out of recurrent revenue. Besides, for the reasons I gave earlier, a higher deficit translates into a wider trade gap (by an estimated Lm7.5 million in the above example). Proponents of more government spending should also bear in mind that even in the absence of the euro adoption factor, Malta would still have to abide by the Stability and Growth Pact (SGP). You might recall that even the British Government, which has no immediate plans to adopt the euro, was called to order by the EU Council some time ago because of its growing budget deficit. Then again, sound public finances are fundamentally a matter of economic common sense and prudence. So much so that in recent years there have been repeated calls on the government from all quarters to reduce the deficit and the public debt. Is it not strange, therefore, that just when headway is finally being made in this very direction, we hear calls for a reversal of this policy and for engineering what would at best be a short-term boost to growth? One should also bear in mind that Malta’s main challenge is to become more internationally competitive. In this respect, an increased fiscal deficit will not solve anything. Malta needs quality growth, preferably resulting from foreign direct investment, which brings with it capital, technology and markets.

Beyond the yearly shadow banking monitoring exercises, policy makers intended to make sure that no part of the financial system would be left unregulated and that a similar set of rules should apply to a similar set of risks. For the sake of a better regulation of globally systemically important institutions, some progress remains possible in the monitoring, and the need for relevant data in particular as regards the better understanding of inter-linkages among G-SII. Cross-sectorial consistency was seen as a key factor to prevent any opportunity for regulatory arbitrage and preserve appropriate level playing field. The Financial Stability Board following the G20 recommendation has launched an ambitious regulatory program which aims at better controlling risks which are related the shadow banking sector. Indeed, the US have recently adopted a regulatory framework for Money Market Funds (July 2014). Other reviews are still ongoing, I am thinking of the assessment of risks and systemicity of asset managers whose assets under management have experienced a major growth these last few years, or the rapid development of ETFs providing real time liquidity on their liability while their matching assets have a lower liquidity. In Europe, this global initiative translated into a number of regulatory initiatives such as the Securities Financing Transactions Regulation (repos and SFTRs) or the Regulation of Money Market Funds. The final objective was to turn the shadow banking sector into a safer and regulated “market-based financing”. 2.
News conference  Zurich, 17 December 2020 Fritz Zurbrügg  Introductory remarks by Fritz Zurbrügg In my remarks today, I will begin with the developments in the Swiss banking sector environment. I will then provide an assessment of the current situation at the two globally active big banks, Credit Suisse and UBS, as well as at the domestically focused banks. Finally, I will talk about the impact the coronavirus pandemic is having on the use of cash. Banking sector environment  Economic conditions for the Swiss banking sector continue to be difficult. As already mentioned by my colleague Thomas Jordan, while global GDP has recovered somewhat since the downturn in the second quarter, in most countries economic activity remains well below its year-back level. As a result, credit risks in particular have increased worldwide, with ratings of corporate bonds deteriorating significantly over the course of the year. In comparison with the real economy, the situation on the global financial markets has eased considerably more since the spring. Risk premia on corporate bonds rose markedly after the outbreak of the pandemic, but have since largely declined again. Stock prices have also recovered from their downturn in February and March. The steep recession has thus far had very little impact on the Swiss credit and real estate markets. Lending volume in the mortgage market and prices in the residential real estate market continued to rise in the second and third quarters of 2020. Furthermore, the number of bankruptcies and value adjustments on existing loans has remained low.

Improved confidence has also benefited from the changes in certain external conditioning factors, such as those linked to the ECB’s monetary policy and to the progress in economic and monetary union, which have prompted an easing in financing conditions. On top of these are other more transitory effects, such as those linked to the low level of oil prices or to the depreciation of the euro. I shall continue with the analysis contained in the Annual Report, briefly reviewing the key factors behind the recovery. Budgetary consolidation Firstly, regarding public finances, the general government deficit met the objective set by the European Council (5.8% of GDP) for the third year running. In 2014, fiscal policy had a less restrictive impact than in the preceding years and was a less prominent conditioning factor of macroeconomic developments. The reduction in the deficit in 2014 came about as a result of the greater adjustment made at the central and local government levels, since most of the regional governments exceeded the targets set. The budgetary improvement was also the consequence of a similar-sized contribution by revenue and public spending (once the impact of the financial assistance to the banking system is stripped out of spending). The tax take progressively picked up during the year, in step with the cyclical improvement and the change in the composition of GDP.
This means we trim out the most volatile price movements in the consumer basket to achieve the best sense we can of underlying price stability. In the July statistics, we saw some of the fastest rates of increases in a while for the largest, leastvolatile components of core services, such as rent and purchased meals.3 So the jury is out as to whether we have seen a reversal in the recent upward ascent of prices toward our 2 percent target. As to achieving “moderate interest rates”, the dashboard shows that we have overshot the mark. Interest rates on the lowest-quality credits – on “junk” – are historically low, as are the spreads they are priced at above the current historically low nominal rates for investmentgrade credits. I have been involved with the credit markets since 1975. I have never seen such ebullient credit markets. The 30-year Treasury yield is trading at a hair over 3 percent. If Ambassador Jaishankar and I were to abandon our service to our respective nations and form a company, we would use our good names to borrow as much money as we could at current rates.

He noted that President Harry Truman “wanted a one-armed economist, not the usual sort that analyzes every problem with ‘on the one hand, this, and on the other, that.’” Gross claimed that Fed Chair (Janet) Yellen, in her speech given recently at the Fed’s Jackson Hole, Wyo., conference, introduced so many qualifications about the status of the labor market that “instead of the proverbial two-handed economist, she more resembled a Hindu goddess with a half-dozen or more appendages.”2 Whether you analyze the labor markets with one arm or two, or six or 19, the issue is how quickly we are approaching capacity utilization, so as to gauge price pressures. After all, a central bank is first and foremost charged with maintaining the purchasing power of its country’s currency. Like most central banks around the world, we view a 2 percent inflation rate as a decent intermediate-term target. Of late, the various inflation indexes have been beating around this mark. Just this last Friday, the personal consumption expenditure (PCE) index for July was released, and it clocked in at a 1 percent annualized rate, a pace less than the run rate of April through June. Does this mean we are experiencing an inflation rate that is less than acceptable? I wonder. At the Dallas Fed, we calculate a trimmed mean inflation rate for personal consumption expenditures to get what we think is the best sense of the underlying inflation rate for the normal consumer.