samchain/econo-pairs-v1 huggingface dataset:
First, the main effect of technology is to transform jobs rather than create or destroy them. Go to any conference on technology and the future of jobs, and the most frequently asked question is: will technology create jobs or destroy jobs? The question misses the main point – which is that technology affects tasks within jobs rather than entire jobs. Many of the jobs we have been doing all these years have not disappeared, but the tasks we do within jobs have changed substantially because of technology. And these new tasks require new skills. And this is what the E&Y study also finds. Data analytics and automation will augment one out of two job roles in the financial sector. In other words, workers will be able to deliver over and beyond what would traditionally be expected. While some rules-based tasks will be automated, data analytics and automation will amplify the importance of tasks requiring human judgement. The study also finds that one out of three job roles will be heavily transformed. This means that a proportion of tasks within these jobs will be substituted using data analytics and automation, and the remaining tasks will converge into new job roles that require more judgement, customisation and creativity. In some other cases, most of the tasks could become automated and these job roles could be displaced. The key take-away from all this: focus on tasks that will be affected by data analytics and identify the skills necessary to perform these new tasks.

Traditionally – and this is true of the industry globally – financial institutions dealt with business transformation through a simple hire-and-fire strategy: hire from the market people with the skills to do the new emerging jobs and fire those in jobs that have become less relevant. This strategy will no longer work. The combination of deep domain skills, broad lateral skills, and the digital skills of the future does not often come in a package. The superior strategy is to continually train, upskill, and transform the existing workforce. This calls for a comprehensive workforce transformation strategy that is closely aligned to the business strategy. All the industry CEOs that I have spoken to understand this well. Together, let us build an agile and responsive training ecosystem that will transform the financial sector workforce. Let me now invite Mrs Josephine Teo, Minister for Manpower, to deliver her keynote address. 3/3  BIS central bankers' speeches
After all, notice that the red and green regions of the bull’seye chart show modest inflation above 2 percent is much more acceptable than even 6 percent unemployment. The FOMC should be anxious to get to that bull’s-eye region as quickly as feasible given the long slow path to date. The Fed’s reaction function I’ve spoken so far about how we are missing on our policy objectives. Obviously, the aim of policy is to eliminate those misses. How do we hit the bull’s-eye? What do we do 6  BIS central bankers’ speeches  operationally in terms of policy tools? In normal times, the FOMC moves it’s traditional policy tool, the federal funds rate, in order to influence aggregate demand and with it economic growth and inflation and disinflationary pressures. Many economists have studied the relationship between actual Fed actions and sensible, explicit policy rules that might capture the Fed’s policy reaction function (chart 4). Historically, Fed policy moves have been reasonably well described by simple policy rules, particularly the 1999 version of the so-called Taylor rule, 7 that relate the federal funds rate to the differences of output (a proxy for employment) and inflation from their target levels and a constant term that is meant to capture the equilibrium real interest rate and the Fed’s inflation target. However, this rule does not always describe policy well. For example, given judgmental, but reasonable, choices for the Fed’s inflation objective before it adopted a 2 percent objective, the Taylor rule misses during the 1990s are big.

All this should lead to a more harmonised regulation and supervision across countries, and as a result also foster financial integration. 2  BIS Review 47/2010  For central bankers, the part of the reform which directly concerns them is the establishment of the ESRB, a new independent body that will for the first time carry out a comprehensive macro-prudential oversight of the financial system of the EU. The ESRB will also issue risk warnings, and, where appropriate, recommendations, and follow up their implementation. This body will bring together the central bankers, the heads of the three supervisory authorities, the Commission together with the supervisors of the 27 EU Member States to regularly discuss and assess the financial stability conditions in the EU. In that respect, the ESRB shows some keen similarities with the Financial Stability Council in the proposed financial reform in the United States. The ESRB is expected to support financial integration through its contribution to financial stability in the EU. Indeed, if market participants are confident that the authorities take properly into account the interdependencies between countries and the various components of the financial system, they are likely to fully exploit the possibilities offered by cross-border activities in the EU.
Selecting Barcelona as the venue for ISDA’s discussions offers us a chance as well to celebrate the ancient and the innovative, the old and the new, in financial services. This conference, for example, will address some of the most sophisticated products in banking and finance and the risk management practices, legal developments, and technological advances that are emerging to support these new businesses. At the same time, our discussions here in Barcelona will remind us that we must all always monitor and control the fundamental – and traditional – risks involved in our activities. Credit risk, market risk, and operational risk have always been with us in various forms, although they have increased in complexity over recent years. What has changed dramatically, however, is our ability to measure and monitor those risks more comprehensively than our predecessors ever could. We have, moreover, improved our ability to manage or transfer those risks, and I would like to share with you today some thoughts on work underway in the financial community in this regard. There are three topics that I would like to address in my intervention. I will begin by sharing first, in my personal capacity, some thoughts regarding the need for standards to evolve and keep pace with the times, whilst ensuring that new standards are not unduly burdensome and do not hinder firms’ abilities to innovate.

In this respect, I’d like to look forward and address some of the work we are doing to ensure that the new international capital standard - Basel II - remains flexible and able to adapt to emerging practices and risks. Many of you have a very strong interest in the efforts the Committee is undertaking to consider how best to apply Basel II to certain trading-related exposures using the latest tools being developed by the industry. While this work is still ongoing, I would like to share a status report with you on that effort. Finally, I will highlight some of the work that we are undertaking to promote a smooth and consistent transition to Basel II, including our plans to conduct a review of the calibration of the framework, as well as our efforts in the field of supervisory co-operation and validation, and the key messages that are coming out of these initiatives. The evolution of standards and regulatory burden Allow me to begin by sharing some personal thoughts on a topic that has captured some attention recently: The view, held by at least some in the financial services sector, that the tide of regulation has risen to a high water mark. In my own conversations around the world, I have heard similar concerns from some bankers. Some point to the long debates that have taken place in the accounting  BIS Review 17/2005  1  profession.
BIS Review 28/1998  ˝  -5-  18. The latter point needs some further elaboration. As you will be aware, Hong Kong’s monetary policy is built around exchange rate stability in the form of the link between the Hong Kong dollar and the US dollar. This is backed up by the currency board system which requires the monetary base of the banking sector - the notes and coins in circulation and the clearing balances held with the HKMA - to be fully backed by foreign currency. When the Hong Kong dollar is under pressure as it was at the end of October 1997 and again in January of this year, the HKMA buys Hong Kong dollars from the banks in exchange for US dollars and the monetary base shrinks. This tightening of liquidity will in turn cause interest rates to rise, perhaps sharply so. This will choke off the inflows and restore stability to the exchange rate. 19. It is important to realize that this is an automatic process and that the HKMA has no room to maneuver to prevent the rise in interest rates from taking place. To do so would run counter to the basic principle of the currency board and would risk prolonging any attack on the Hong Kong dollar. 20. I think that there is now a better understanding of how the currency board system works. In addition, our determination to adhere to the system and to defend the linked exchange rate has been clearly demonstrated.

The Asian economies were certainly not fault-free, but in general they not exhibit the classic signs of gross macroeconomic weakness that normally lead to a balance of payments crisis. Governments ran fairly prudent fiscal policies, savings were high and inflation rates reasonably low. Even if policy mistakes were made, the punishment does not really seem to fit the crime. 3. Why then have exchange rates fallen by as much as they have and why have economies in the region been so severely crippled? It is generally agreed that a large part of the answer lies in the weakness of financial and banking systems in the region, which have amplified the initial effects of external shocks and economic downturn. In essence, banking systems that were already in weak health before the crisis broke were not up to the task of intermediating large inflows of capital. They have been part of a vicious circle whereby loss of confidence in the currency leads to loss of confidence in the banking system that further undermines the currency. This is the “run on the country” syndrome. It therefore follows that strengthening of the banking system must be part of the cure of the Asian disease and the means of preventing a recurrence. Banking supervision has an important part to play in this strengthening - hence the topic of my speech today. The weaknesses in Asian banking systems 4.
The imbalances may continue for a period. International capital markets are deep and liquid with an ample supply of credit for US borrowers. If creditors begin to fear a fall in asset prices and withdraw, this may still trigger substantial corrections. This may lead to higher interest rates and perhaps also a fall in US equity markets that spills over to other countries’ financial markets. In that case the dollar will also depreciate. The household debt burden in the US may be another source of instability if households abruptly reduce both housing demand and consumption. The US is not the only source of trade imbalances. They also reflect very low growth in continental Europe and the largely export-based growth in Asian countries. Countries other than the US must therefore also contribute in order to prevent growth in the global economy from faltering. With limited domestic growth capacity and high unemployment, many industrial countries are poorly equipped to cope with a weaker dollar and lower US demand. The challenges are perhaps particularly demanding in Japan and some large European countries. There is also a risk that large imbalances in world trade and low employment in Europe will trigger protectionism, which could reduce growth capacity even further. 2  BIS Review 34//2005  Partly due to very high growth in demand for oil, the average price for Brent Blend rose to almost USD 40 per barrel in 2004. Strong economic growth, particularly in the US and China, has resulted in high energy consumption.

This has been achieved in an orderly manner. Of importance was that the preconditions had been put in place to ensure this orderly transition. The banking sector had been strengthened, the bond market had been developed, and the capital account had been sequentially liberalised. These developments were reinforced by the further deregulation and liberalization of the domestic financial system, thus creating a more competitive financial environment. The successful transition to the new regime following these developments has seen a two-way movement in the exchange rate that reflects the underlying economy and the market conditions. Monetary policy in this environment will continue to be conducted in a manner that will ensure that the long-term growth prospects of the economy is achieved with price stability. As a small, open economy, Malaysia is not insulated from the inflationary forces being felt globally. In this regard, decisions on monetary policy will be determined by the Bank's assessment of a broad range of indicators of the domestic economy. The Overnight Policy Rate (OPR) remains the signalling mechanism to achieve the policy objectives. Interest rates, therefore, is not an instrument to influence capital flows or the exchange rate. The Bank continues to undertake initiatives to enhance communication to promote greater understanding of the objectives, processes and conduct of monetary policy. Extensive deliberations in  BIS Review 55/2006  1  assessing the latest domestic and global economic, monetary and financial developments are conducted at the Monetary Policy Committee (MPC) meetings, which are held eight times a year.
Nevertheless, since the exchange rate can affect the health of the economy the SNB will also continue to take the exchange rate closely into account when determining its monetary policy. 6  BIS Review 60/2002

Øystein Olsen: Management of the Government Pension Fund Global Introductory statement by Mr Øystein Olsen, Governor of Norges Bank (Central Bank of Norway), before the Standing Committee on Finance and Economic Affairs of the Storting, Oslo, 2 May 2017. * * * In 2016, it was 20 years since the Ministry of Finance made the first capital transfer to the Government Petroleum Fund, as the Government Pension Fund Global (GPFG) was aptly named at the time. This transfer marked the start of a transformation of petroleum wealth in the form of oil and gas in the ground into financial assets invested outside Norway. Since the first capital transfer was made, the GPFG has grown considerably, to more than 2.5 times the size of GDP. The year 2016 also saw the first net withdrawal from the GPFG. Ahead, the value of the GPFG will therefore, to a greater extent than previously, depend on the return on the fund’s investments. The period of steady growth in the GPFG as a share of the economy is now probably over. The key variables determining the GPFG’s long-term performance have been specified by the Ministry of Finance and approved by the Storting. For its part, Norges Bank has developed its management assignment in accordance with the fund’s growth and in line with the owner’s mandate. At the same time, Norges Bank has focused on its role as advisor in the further development of the fund’s investment strategy.
The blue line in the chart shows that GDP growth was markedly higher than trend growth in the latter half of the 1990s and in the period from 2003 to 2008, but that it has risen somewhat more slowly in the period following the financial crisis. When developments in output are compared with inflation, a pattern emerges. A pickup in GDP growth has consistently occurred 4–5 quarters before a rise in inflation.5 While the chart says nothing about causality, turning points in GDP growth seem to be a fairly reliable leading indicator of turning points in inflation. The path from changes in output to inflation passes through the labour market, among others. We have seen that when economic growth has picked up, unemployment6 has declined one to two quarters thereafter. The relationship between the “output gap” and the “unemployment gap” is fairly strong. This is a useful observation because GDP figures are published with a considerable lag and often subject to revision, while the unemployment data published at the end of each month are not revised. If there is uncertainty about the GDP figures – which there often may be – falling unemployment can be an indication of a recovery in economic growth. Labour market developments, in turn, affect wage growth, as illustrated by the blue line in the chart. High unemployment results in low wage growth, and vice versa. The chart shows that in periods of falling unemployment, wage growth7 moves up fairly rapidly.

Since last May, the risk of higher domestic inflation has been weighted into our decisions. Whereas the  BIS Review 19/2002  3  Swedish repo rate at the beginning of last year was lower than its counterparts in the euro area and the United States, it is now higher. Looking ahead, we have as usual not committed ourselves. What we do or refrain from doing with the repo rate will depend on the new information that becomes available and on how we assess and analyse it. What happened last year is a good illustration of the appropriateness of this approach. Neither positive nor negative surprises can be ruled out. We have to be ready to cope with that. That said, we have inflation that is relatively high, even though we count on it becoming a good deal lower in the coming six months. Resource utilisation is probably relatively high, too. The path of the interest rate will then depend – as long as inflation expectations remain in place – on how economic activity develops. If activity continues to strengthen as expected and there is no reason to reappraise the economy’s inflation propensity, it is reasonable to assume that the repo rate in Sweden will be adjusted successively upwards. This does not come as a surprise to participants in financial markets.
It performs its main objective, as it is written down in the law – to keep the national currency stable – and also the functions relating to its exclusive right to release banknotes and coins into circulation and to maintain the currency circulation in Bulgaria. One year after the BNB was founded, the Law on the Right of Minting Coins in the Principality was adopted, whereby the national monetary unit was created and named ‘LEV’ and the coins were named ‘stotinki’. In 1881 the first Bulgarian coins – copper coins in denominations of 2, 5 and 10 stotinki – were minted in England, and in 1882 silver 1 and 2 leva coins were minted in Russia. Soon the Bulgarian lev became widely accepted, facilitating trade payments and fostering the country’s economic development. At the same time the new national currency began to play the role of a ‘national unifier’, a symbol of the independence and sovereignty of the new Bulgaria. For many years the production of Bulgarian coins used to be assigned to specialised mints in Europe – Birmingham, St Petersburg, Brussels, London, Vienna, Paris, Belgrade, Kremnica, Budapest and Berlin. For over six decades now, since the Bulgarian Mint opened up in 1952, Bulgaria has been producing its own circulation coins, and since 1965 commemorative coins as well. In 1994 the BNB Printing Works was established as a structural unit of the central bank, and four years later the printing of Bulgarian banknotes began.

This means that the financial sector is of considerable importance to the national economy and it is thus reasonable that the State should intervene in the workings of the financial system. In the wake of the crisis, one element of the discussion has been that regulation and supervision have to date focused too much on individual institutions and too little on the risks that were generated in other parts of the system. There is a lot of talk about the need to build structures that can prevent systemic risks, a so-called macroprudential framework. Exactly what a macroprudential framework contains is still unclear. It seems to mean somewhat different things to different people. I have therefore simply decided not to use this term today. Instead I intend to discuss the content of future efforts to prevent systemic risks without even mentioning the term macroprudential or its Swedish equivalent – a word that we have not yet invented. About the crisis: something old, something new and something borrowed Running a bank is about creating and maintaining confidence. When a bank makes losses – or it is feared that it will make losses – capital is required to cover these losses so that  confidence is not undermined. When the crisis became really serious, the banks did not have sufficient capital to retain confidence. This resulted in a liquidity crisis. The liquidity crisis became so severe because the banks had become increasingly dependent on short-term market funding.
But as a general rule banks should not be prevailed upon against their better judgement to be providers of economic aid or social services, whether domestically or internationally, unless there is the political consensus that taxpayers are willing to fund them in that role. The internet Turning now to the internet, I believe that this has some relevance to the overall theme of this symposium, not so much because of questions about the availability of banking services to those who need them, but rather because of possible implications for the location and structure of banking activity. Let me begin by observing that, ever since the telecommunications and IT revolutions began substantially to impact on banking – and that, depending on how exactly one defines the terms, was at least two or three decades ago – some commentators have been forecasting the imminent demise of financial centres as such. The argument is that all the humdrum work will be carried out in computer centres and call centres in low wage countries, while the high value adding executives can locate where they wish – depending on their preferences for recreation, culture, climate and so on – and tele-conference one another when necessary. The former – the migration of routine operations to lowcost places – has happened to a degree, but the latter has not. Even if colleagues within a bank can sometimes substitute a conference call for a meeting, their customers have been less eager.

There is huge overlap between the areas of interest of, and information required by, and available to, both the supervisor and the central bank. Second, rescue or liquidity crisis will normally involve and require the immediate BIS Review 55/1997  -8-  provision of liquidity, which can only be done by the central bank. This is facilitated by internalising the supervisory body within the central bank. Others argue the reverse. First, since the finance of any large rescues involves government funding, the politicians have a direct interest and involvement in financial regulation. This may undermine the independence of a central bank if it also plays a supervisory role. Second, it is argued that an independent central bank in its conduct of monetary policy and being responsible for banking supervision may be perceived as too powerful. Third, the failure of a central bank in its supervisory duties will harm its credibility in its conduct of monetary policy. There is an inherent conflict between supervision and monetary policy. Central bank assistance to bail out problem banks tends to be inflationary on the money supply. The arguments are finely balanced. Whether the regulatory power should be centralized or diffused will depend very much on the legal, constitutional and historical background for each financial system. Conclusion Regulation is an art, not a science. It involves complicated trade-offs between competing interests. As Walter Bagehot said over 120 years ago, money will not manage itself. The regulation of money will be debated in the years to come.