samchain/econo-pairs-v1 huggingface dataset:
When the new Executive Board of the Riksbank took office at the beginning of 1999, we found no reason to change the target formulation. To make it possible to evaluate how we carry out our task, we endeavour to be as clear as possible about the grounds on which monetary policy decisions are made. Inflation assessments and interest rate decisions are explained in the Riksbank’s inflation reports. The Riksbank has also stated a rule of conduct for what should normally lead to decisions on interest rate rises, and the justifications for departures from this rule of conduct. Finally, the published minutes of the Executive Board’s monetary policy meetings contain an account of how we voted and the reasoning underlying the decisions. Resource use is important for inflation Since the interest rate affects inflation with a time lag, monetary policy decisions are based on forward-looking assessment of inflation. Highly simplified, the conceptual framework, used by the Riksbank in the appraisals of price tendencies, can be described as follows: when there is unused capacity in the economy, price pressure is low and inflation is under the target. When demand is sufficiently high to lead to output exceeding the level that coincides with the long-term trend level of production, inflation instead tends to exceed the target. Inflation will be on target when output is at the level of the long-term trend level of production - the output gap is closed. This reasoning assumes that inflation expectations are close to the target for monetary policy.

In order to remain relevant and effective in meeting the growing financial needs of an expanding economy, DFIs need to increasingly draw funds from alternative sources, such as the capital market. Sourcing funds directly from the market would also help instil certain form of discipline on the operations of the DFIs. Allow me this opportunity to now share with you an overview on the roles and developments of DFIs in Malaysia. There are currently 14 DFIs in Malaysia. Like those found in other countries, the DFIs were established and funded by the Government to develop and promote identified strategic sectors, in line with the overall industrialisation and economic development objectives of Malaysia. The first DFI was the Malaysian Industrial Development Finance Berhad (MIDF), which was established in 1960, to provide medium to long-term financing to promote the development of private industrial enterprises. Subsequently, several major DFIs were established, including Bank Pertanian Malaysia (or the Agriculture Bank of Malaysia) to promote agricultural development, Bank Pembangunan Malaysia Berhad (or the Development Bank of Malaysia) to promote Bumiputera indigenous community development in commerce and industry, Bank Industri Malaysia Berhad (or the Industrial Bank of Malaysia) to support development in the industrial and manufacturing sectors, as well as the Export-Import Bank of Malaysia (EXIM Bank) and the Malaysia Export Credit Insurance Berhad (MECIB) to promote international trade and support export diversification and expansion, especially to the non-traditional markets.
Chart 2 shows a measure of excess volatility in these series over time (a moving average of the ratio of actual to fundamentals-based volatility), while Chart 3 shows a measure of price misalignment (the absolute deviation of prices from fundamentals, expressed as a percentage of prices). Chart 2 suggests that, on average over the past century, US stock prices have been over three times more volatile than fundamentals, confirming the excess volatility hypothesis. But the trend in the degree of excess volatility is also telling. Up until the 1960s, prices were around twice as volatile as fundamentals. Since 1990, they have been anywhere between six and ten times more volatile. Excess volatility in equity prices has risen as financial innovation has taken off. The pattern is much the same with measures of misalignment. Up until 1960s, the average absolute deviation of US equity prices from fundamentals was just over 20%. Since 1990s, the average absolute deviation has been well over 100%. Charts 4–6 present the same evidence for UK equity prices since 1920. While less dramatic, the patterns are much the same. Misalignment correlates with innovation and liquidity. Patience and profits To bring these market inefficiencies to life, consider a simple experiment to gauge the relative performance of momentum and long-term investors. Both are assumed to follow a simple strategy: the speculator buys (sells) when prices have risen (fallen) in the previous period; the fundamentalist buys (sells) when prices are low (high) relative to fundamentals.

By 2009, that long-term investor’s stake would have risen to $ Over the same period, the momentum traders’ stake would have returned $ Buy-and-hold would have out-performed bought-and-sold by a factor of around 36. How different the world may have looked. Fundamentals would have triumphed over momentum. The sheep would have been herded by the goats. Facing a losing streak, speculators may have gone the same way as despairing Dick Fuld or the ravenous robin. The gene pool may have been cleansed of the impatient. Patience may have helped ward off great disaster, the like of which we have recently seen. Just as patience can ward off great disaster, impatience can ruin a whole life. Generations of dieters and addicts are testament to that. So too is finance, not least in the light of the crisis. It is important finance sticks to the patient evolutionary path. To do so, the fidgeting fingers of the invisible hand may need a steadying arm. 14  BIS Review 114/2010  Annex  BIS Review 114/2010  15  16  BIS Review 114/2010  BIS Review 114/2010  17  18  BIS Review 114/2010  References Ainslie, G and Haslam, N (1992), “Hyperbolic Discounting”, Choice Over Time, Russell Sage Foundation. Ainslie, G (1974), “Impulse control in pigeons” Journal of the Experimental Analysis of Behaviour 21(5). Angeletos, G, Laibson, D, Repetto, A, Tobacman, J and Weinberg, S (2001), “The Hyperbolic Consumption Model: Calibration, Simulation, and Empirical Evaluation”, Journal of Economic Perspectives 15(3), pp 47–68.
The extra margin is well named because there’s real value for a firm in being able to choose when to invest. Able to pick its moment, the firm can go ahead with an investment project when there’s good news about future returns – and, equally, avoid committing itself when there’s a risk the investment will make a loss. 3  Abel (1983) points out that, for given capital, a firm’s profits are a convex function of the price of its product: they rise more in response to a given increase in the price than they decline as a result of the same-sized fall. This means that uncertainty about future prices actually raises expected profits, and therefore the incentive to invest. 5  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  5  In fact, it turns out that these downside risks are the more important determinant of the decision. The reason is that, as long as it doesn’t take long to implement an investment, the firm can always respond to good news as and when it comes through. It has the same exposure to upside risks whether it invests in advance of good news or in response to it. What it can’t do, however, is to undo an investment it’s already made if it subsequently gets bad news about future returns. The real value of waiting is that, if things do take a turn for the worse, the firm will have avoided the resulting losses.

John C Williams: Diversity and inclusion - we are not where we need to be Remarks by Mr John C Williams, President and Chief Executive Officer of the Federal Reserve Bank of New York, at the OPEN Finance Forum, New York City, 25 June 2019. * * * As prepared for delivery Good morning. I’m an economist, so I’m going to start with some numbers. The unemployment rate for lesbian, gay, bisexual, and transgender people is nearly double the national average.1 And the unemployment rate specifically for transgender people is three times the national rate.2 As President of a Federal Reserve Bank, I am focused on two vital economic goals: maximum employment and stable prices for the U.S. economy. These statistics paint a clear picture of why conferences like this one are so important: We are not where we need to be. Before I go any further, I need to give the standard Fed disclaimer that the views I express today are mine alone and do not necessarily reflect those of the Federal Open Market Committee or others in the Federal Reserve System. Let me say, as an ally, that it’s a genuine honor to be invited to open today’s Forum. This Pride Month marks 50 years since the Stonewall uprising. We’ve come a long way since the 1960s, but we still have far to go. It was also a great honor to be able to fly the Pride flag outside the Federal Reserve Bank of New York for the first time this June.
This evolution in the Committee’s thinking about capital adequacy follows from much of our recent work on risk management and the surveys we have conducted on banks’ disclosure practices. It is also consistent with the broader notion of supervision I’ve discussed today. We encourage comments on the Committee’s proposals from both supervisors and industry participants through 31 March 2000 - which is next week - and plan to publish, hopefully early next year, a comprehensive set of proposals that will be responsive to the comments and input we have received. Let me highlight briefly each of the three pillars and provide some perspective on the key challenges that the Committee faces in relation to each. The first pillar is minimum capital requirements. To address the shortcomings in the 1988 Accord, the Basel Committee has proposed two primary approaches: •  an enhanced standardized approach that ties risk weightings to external credit assessments such as credit ratings; and  •  an internal ratings-based approach that would begin by mapping internal risk ratings into standardized risk weightings, but might eventually evolve into something closer to the full use of credit risk models. Each approach treats the trade-off between simplicity and accuracy somewhat differently and thus one or the other is likely to be relevant to banks with different levels of sophistication. Most importantly, both proposed approaches attempt to introduce greater risk sensitivity into the minimum capital standards to address the unfortunate incentive problems that have evolved from the 1988 Accord.

These economies show signs of a slowdown that can be traced to decreased exports to Asia but there are also indications that their domestic demand is slackening. In the euro area, however, growth prospects seem to be more favourable. The recovery appears to be firm—to a growing extent as a result of stronger domestic demand—and it looks as though inflation will remain low. The overall picture of international activity is somewhat weaker than the Riksbank forecast in June. International inflationary pressure is low. The extensive economic problems in Japan and the unrest in global stock exchanges are contributing to this. BIS Review 66/1998  -4-  Swedish economy strong Economic growth in Sweden seems to be good, however. As expected, the statistics show an accelerating growth of domestic demand, accompanied by a slowdown in foreign trade. Private consumption is rising strongly and a continuation of this trend is indicated by a number of factors: households’ personal economic expectations are still rising, employment is expanding and disposable income is growing as a result of low inflation and a less restrictive fiscal policy. Uncertainty about share prices could have a contrary effect but the downward movements that have been observed constitute no more than a correction after a relatively strong increase. Since the beginning of 1998 the Stockholm Exchange has risen 20 per cent. The statistics also show strong growth for public consumption as well as gross capital formation. But foreign trade is weakening; export growth is slowing and imports are rising.
Gent Sejko: Global Money Week 2021 in Albania Address by Mr Gent Sejko, Governor of the Bank of Albania, at the opening ceremony of the Global Money Week 2021 in Albania, Tirana, 23 March 2021. * * * Honourable Minister of Education, Youth and Sports, Honourable Chairman of the Albanian Association of Banks, Dear students, teachers, friends and colleagues, I am pleased to welcome you in the opening ceremony of Global Money Week 2021. For more than one decade, the Bank of Albania has been engaged in this world-wide movement, in organising during the last week of March, educational and awareness activities dedicated to children, young people and students. Global Money Week, already turned into a tradition, is organized in collaboration with the Albanian Association of Banks, and with the valuable support of the Ministry of Education, Youth and Sports. Due to difficulties arisen by Covid-19 pandemic, the Global Money Week, this year won’t be launched at the premises of the Museum of the Bank of Albania, but virtually, in compliance with the health safety and social distancing measures and regulations. I have already emphasised in my previous comments to this event, that GMW is an world-wide initiative organised by the OECD International Network on Financial Education (OECD/INFE), aimed at raising awareness of the younger generation to become in turn financially responsible citizens in the future. Every year, in March, central banks, public agencies and financial institutions and civil society organisations from around the world organise GMW activities.

In this view, the Bank of Albania, as the supervisory and promoter institution of the Albanian banking system, in addition to the immediate response to the difficulties created by COVID-19, through a complete package of monetary, supervisory, macro-prudential and operational measures, finds also important the drafting and organisation of educational initiatives, like Global Money Week. Through these educational and awareness-raising activities, we aim at approaching the young generation to the complicated world of finance and banking; to introduce and pass through knowledge on possibilities; the risks that both financial and banking products have; as well as introduce the young public to the necessary information on borrowing and savings. This communication and awareness of young people, in turn help both financial and banking markets become more resilient, comprehensive and efficient. 1/2  BIS central bankers' speeches  The Bank of Albania, has not limited its educational activities only with the Global Money Week. Financial literacy of public is an important part of our daily work. Thus, through virtual educational tools available at our webpage, students and teachers may learn throughout the year on financial issues, by watching videos and reading the literature dedicated to both the pre-university education and students. Our webpage contains simplified information on themes of everyday life, as: the opening of a bank account; personal budget management, drafting a saving plan; applying for a bank credit, etc.
The second example I would like to mention here is the introduction of the minimum exchange rate in September 2011. This rate was introduced to correct a massive overvaluation of the Swiss franc arising from adverse developments on the foreign exchange market, and thereby avert the threat of a deflationary trend. I have explained to you why this instrument is still needed and is being enforced by us without any restriction. A measure like the minimum exchange rate can only succeed if the central bank is totally credible, in other words, if people believe it will actually defend the rate, if need be. Words can certainly achieve a great deal in the financial markets. But this only holds true if they are followed up with deeds when necessary. In the case of the minimum exchange rate, the deeds in question are unlimited foreign currency market interventions. In 2012, we were required to enforce the minimum exchange rate with extensive foreign currency purchases, and our balance sheet total increased significantly. If there were statutory restrictions on our balance sheet we would be unable to introduce and enforce a measure of this kind. The financial markets would call into question both our resolve and our ability to see the measure through. Concluding remarks Ladies and gentlemen, I come to my concluding remarks. Even seven years after the onset of the financial crisis, the environment remains very challenging for our economy and for Swiss monetary policy.

Central Bank of Chile March 2019  CBC-IADB Joint Workshop on “Basel III in the Context of the Macroprudential Approach” Opening Remarks by Mario Marcel, Governor of the Central Bank of Chile Ritz-Carlton Hotel, Santiago, Chile – March 29, 2019 Good morning and welcome to the “Basel III in the Context of the Macroprudential Approach” workshop which is co-organized by the Central Bank of Chile and the Inter-American Development Bank. It is a pleasure to host this event in Santiago, at a very appropriate timing. After a year and a half of legislative discussion, on January 12th of this year, the new General Banking Law was enacted. This is the most significant change to solvency regulations since 1986, setting the basis for the implementation of the Basel III framework in Chile. A second reason goes back 35 years. In a few more days, the Central Bank will receive the last repayment of the subordinated debt originated in the rescue of the Chilean financial system of the early 1980s. It has been a long way since this episode, and the fact that only now can we finally put it behind us, highlights the importance of doing everything in our reach to prevent the occurrence of major financial disruptions. Allow me to go briefly over the history of the Chilean financial system over the last five decades, and how regulation has reacted and evolved over time. Some 50 years ago, banks where almost the only source of financing for companies and households.
In this connection, let me put to you a few facts and allow you to draw your own conclusions. Fact number one: Hong Kong maintains a fixed exchange rate through a currency board system. Such a system requires any change in the monetary base to be matched by a corresponding change in the amount of foreign reserves held by the currency board, with the currency board acting passively in response to capital flows. With a very efficient financial infrastructure, characterized by a real-time interbank payment system, and in the absence of reserve requirements, banks in Hong Kong do not need to maintain large balances in their clearing accounts held with the HKMA. This means that the crucial part of the monetary base, in the form of the aggregate balance in the clearing accounts that all the licensed banks maintain with the Hong Kong Monetary Authority, is very small. This in turn makes interbank interest rates in Hong Kong very sensitive to capital flows into and out of the currency board. The sale of a small amount of Hong Kong dollars by a bank to the HKMA, which has to take it and provide US dollars at the fixed exchange rate in accordance with the discipline of currency board arrangements, could send interbank interest rates sharply higher. Fact number two: the hedge funds had been borrowing and sitting on large amounts of Hong Kong dollars.

On 14 September 1998, he wrote: “the more I think about it, the more sympathetic I become toward the Hong Kong Monetary Authority and its stock market intervention”. David Hale of the Zurich Group also said that: “it is difficult not to sympathize with the frustrations and anxieties which compelled... the government of Hong Kong to intervene in the stock market”. And last week George Soros said in Washington, when asked what he thought of Hong Kong’s actions in the stock market: “I can’t really disapprove”. My correspondence with Alan Greenspan is still ongoing: while I continue to point out to him that we were only trying to deter market manipulation, which in any case is against anti-trust laws in the US, he still has doubts. This is because of the difficulty in distinguishing between what he calls “conventional, albeit sharp-eyed, arbitrage and speculative BIS Review 85/1998  -2-  activities” in financial markets and what I call market manipulation. I shall persevere. In my view, whilst distinguishing between the two is difficult, it is not impossible, particularly when you are close to it. Perhaps I should deploy Chairman Greenspan’s argument for the Fed’s involvement in Long Term Capital Management in justifying our case. Instead of deterring market manipulation, I could say, in Alan Greenspan’s words, that we were trying to “avoid possible serious market dislocations that could have potentially impaired the economy”. But whatever argument we use, it is my firm belief that our actions, whilst controversial, are well justified.
Just as we have had to adapt to these changes, to fulfil our mission going forwards we need to look ahead to the structural shifts we face over the coming years and decades. That will mean hearing central bankers like me speak about things that we have not in the past – terms like central bank digital currencies, cyber risk, and climate change are now firmly part of our lexicon. This is not about us adding new things to our mission, nor is it about doing that which is rightly for others. It is about taking these new things into account alongside the old as we go about fulfilling our mission, delivering monetary and financial stability through time. Climate change Climate change is an obvious, and indeed urgent, example of this. The physical effects of climate change, such as rising sea levels and more frequent severe weather events, as well as the transition to a net-zero economy, through changes in government climate policy, technology and consumer preferences, create financial risks and economic consequences. The question is not if but where, to what extent, and how should we respond. Answering all three of those questions has been at the heart of our work on climate change over the past 6 years. Ignoring them is not an answer. Indeed the longer we wait, the greater the costs of adjustment.

But it is positive that their establishment on the labour market looks like it is starting to go faster. As you know, there are no guarantees in the forecasting business. It has taken a decade, but it seems as though the global economy has finally recovered enough from the after-shocks of the financial crisis to start a new chapter and that central banks in our part of the world will gradually be able to raise interest rates again. For the small Swedish economy, with its reliance on foreign trade, altogether premature or rapid rate rises would jeopardise the strong economy and development of inflation. For the Riksbank, it is a question of remaining vigilant. A prerequisite for inflation to continue to develop in line with the target is that economic activity remains strong and has an impact on price developments. Monetary policy therefore needs to remain expansionary for a while. But if everything goes as expected, the time to start normalising monetary policy will come closer. The assessment we made in February was that it is probably time to slowly start raising the repo rate during the second half of this year. But such a turnaround requires considerable caution, in my opinion. I occasionally hear somebody say that it feels wrong to have a negative policy rate when the economy is going as well as it is now. But the Riksdag has assigned the Riksbank to conduct a monetary policy that contributes to suitably low inflation.