samchain/econo-pairs-v1 huggingface dataset:
We are discussing regulation of the financial system but it doesn’t mean that we need an over regulated system – certainly not. We have to strike a balance, but it is clear in Europe, that we hope we will have a system that will be more regulated, or at least better regulated, without holes in the system. But we are living in a global world and we need to have consistent rules around the world. FT: But Europe also needs to have its own internal dynamism, to encourage innovation. That was part of the problem of the economic model before the crisis. If you create more regulation, doesn’t that make the problem worse? CN: I think it does not prevent innovation if the rules are well designed. The lesson that we should take from the crisis is that if we let something an innovation – like hedge funds, or securitisation – develop freely and continue not to regulate it or exert any surveillance even if it grows to such an important level that it is systemic, then the risk is enormous. We should be able to detect when a systemic risk is becoming too big in the system and then act. BIS Review 29/2009  5

In this regard, the debate should focus on finding the incentives to increase the domestic production and support domestic savings. Over the time these would improve our current account balance, and improve the availability of our foreign currency assets;  c)  the expansion of the economic agents’ funding sources. In this regard the authorities should implement policies that support the development of the non-banking financial sector and that sustain the establishment of capital and debt market for private entities. The accomplishment of these targets shall firstly require the strengthening of the financial reporting standards; the completion and improvement of the legal framework for the developments of business relationships and the improvements in the protection of creditors and consumer rights, regarding the financial institutions and products. In more practical terms, these measures are expected to improve the availability of the funding sources for the economic growth, and gradually decrease its dependence from the banking sector;  d)  the improvement and the completion of the legal and operational framework to strengthen the crisis management capacities of the public authorities. In this regard, the authorities should identify the necessary measures for the prevention, the treatment and the elimination of financial crisis consequences. Bank of Albania believes it is important that each public authority carry out an assessment of its legal, financial, human and technological capabilities, to perform its role in the crisisprone situations. Needless to say, throughout this process, the coordination among the public authorities should be at the highest level.
This is because structural reforms are the policy levers aimed at boosting the supply side of the economy and ameliorate the framework in which businesses and people operate. By tackling obstacles to the efficient production and provision of goods and services, structural reforms can contribute to higher productivity, investment and employment, thus contributing to higher incomes and helping to tackle rising levels of debt. Three specific examples of Government structural reforms include the following: First: The implementation of measures that improve business conditions, promote better allocation of resources, and strengthen market competition are essential policy actions to boost productivity and hence GDP growth. In the area of product markets, a more competitive and business-friendly environment increases incentives of firms to innovate, and invest, in human and physical capital. A relevant example includes the transposition of the EU Services Directive, aiming at lifting restrictions on cross-border providers and removing limits to competition. Unfortunately, the latest periodic assessment by the Commission of the legal and administrative barriers of the EU, which was conducted in April 2021, points to an overall slow speed of barrier removal over 2006 to 2017. Second: Labour market reforms, such as the implementation of Active Labour Market Policies, could minimise labour shortages and labour mismatches, potentially helping to contain both private and public debt. Wage rigidities in Europe have been identified in the past to be important impediments to market clearing and have been linked to high and persistent unemployment. Typically, high unemployment rates are related to bad debt, that is Non Performing Loans.

That role requires them to be vigilant over the emerging risks in a central bank and alert all the concerned parties, management of a central bank and the legislators, so that early corrective measures could be taken to mitigate the risks. Since auditors are governed by the “principle of public trust”, they would be liable for criminal negligence if a central bank becomes insolvent and auditors have not given early warning about it. To play this role effectively, auditors should endeavour to acquire the knowledge necessary for them to assess the work of a central bank and make judgments about the adequacy of that work. They should place themselves on a continuous learning programme so as to acquire not only the technical skills, but also the current global best practices relating to central banking. The central bank management on their part should heed to the warnings issued by auditors and make the necessary internal adjustments promptly. BIS Review 58/2009  7
When the last crisis broke out, central banks slashed interest rates, which rapidly reached near-zero levels In some cases, such as that of the European Central Bank (ECB), rates even turned negative. In this context, central banks had to implement a series of novel, or “unconventional”, measures. These measures included asset purchase programmes, medium- and long-term lending to the banking industry under advantageous conditions, and announcements about the future course of monetary policy, known as forward guidance. The empirical evidence shows all these measures to have been effective at cushioning the impacts of the economic crisis and supporting the subsequent recovery, and they now form part of central banks’ toolkit for the future. Against this background, what scope is there for monetary policy action in the event of a future crisis? As the inflation outlook improves in the future, interest rates may be expected to rise gradually towards their long-term equilibrium rate. The distance between this level and the effective lower bound on interest rates – i.e. the level below which further rate cuts would be counter-productive as a means of stimulating the economy – will determine the future scope for conventional monetary policy. We now know that the lower bound on interest rates in the euro area is not zero, as was traditionally believed, but a negative number which, although difficult to quantify, is probably not far below the current deposit facility rate of 0.40%. Economic theory and the empirical evidence suggests that demography is one of the factors underlying the long-term interest rate.

The financial collapse in Russia, deepening recession in Japan, the long battle – then sudden defeat last week – in Brazil’s attempt to hold its exchange rate, and fluctuating fears of possible knock-on effects on the major countries’ financial markets all contributed to an increased sense of financial fragility, which has not been easy to contain. We can, I believe, still avert a more general international financial upheaval (and the financial markets’ response to the latest developments in Brazil, as well as the beginnings of a recovery in capital flows to some countries in Asia, are reasonably encouraging in this respect). But, we are nevertheless bound to see a pronounced slowdown of world economic activity. The IMF has cut its latest (December) forecast for world growth to less than 2¼% in 1998/1999. And the risks almost certainly remain on the downside. That’s still not global slump or recession. But large parts of the world economy are in fact in recession and the prospect for the world as a whole turns very much on what happens in the major industrial countries. In essence, what we are seeing is a sharp cutback in capital flows to much of the emerging world and to some of the transition economies, enforcing on those countries a corresponding cutback in domestic demand and creating the need for an urgent improvement in their current accounts.
If inflation is expected to be above the 2% target during this time horizon, the interest rate is normally raised and vice versa. This rule was formulated with a view to making policy more intelligible, to ourselves as well as to others. We also believed a rule of this kind would serve as a structure for decision-making and help to enhance confidence in monetary policy. In my opinion, the rule has served these purposes. It has contributed, not least, to a more structured discussion of monetary policy issues and thereby to a deeper understanding of the choices we have to make. Have we observed our rule? Judging from this chart, I would say we have (Chart 2). The chart shows the repo rate in practice together with the path indicated by the Riksbank’s inflation assessments. You will see that we have followed our forecasts fairly closely and thus adhered to our rule of action. Deviations have occurred, mainly in the early years with the inflation target; I believe they were largely connected with concern about the exchange rate.

These include Thai banks’ aim to reduce cash usage and payment cost, leading to collective investment in the new faster pay infrastructure; banks’ and non-banks’ leveraging on the interoperability of our open infrastructure and common standards to compete and expand the range of products and services; and regulators’ and policy agencies’ active roles in promoting financial innovations and digital adoption. FinTech and digital finance have been and will continue to be among the top policy agenda of the Bank of Thailand. We need to further develop digital finance infrastructure, promote innovation, enable dynamic competition, and enhance adoption by the Thai people and businesses. Ladies and gentlemen, While technology advancement and technology adoption will remain crucial, there is another important aspect of financial services that we must not forget as we move on with our FinTech agenda: the value of financial network. Unlike other products and services, financial services will serve the people and the society best only when money—either in the form of physical cash or digital money—can freely flow without cost and friction. In today’s digital world, it is equally important that individuals and society can benefit from financial transaction  2  data. Therefore, preserving and strengthening the value of financial network will be imperative in advancing the development of our financial system. On the opposite end of a strong financial network is fragmentation, whereby financial systems and payment services become fragmented by the use of different core infrastructures or different standards that are controlled by a few dominant players.
In retrospect, my first two terms on the MPC were periods which now look like the small change of monetary policy – small changes in Bank Rate aimed at adjusting for relatively small anticipated deviations of inflation from target. As I suggested at the start, it may however also have been the period in which a large error was made in allowing the belief to become established that policymakers had solved the issue of economic instability. As Jean-Claude Trichet recently commented: “...remedial action has often been triggered as soon as the financial firestorm has threatened the stability of the economic system. But such action risks raising expectations that macroeconomic policy will always insure against tail risks, no matter how large.” 13 Even when policymakers have added robust macroprudential instruments to their armoury, it will be important to be clear that there will still be sources of macroeconomic instability. This may not be easy during any prolonged period without such a shock, unless policymakers are prepared to be a little less assiduous about fine tuning. More recently policy has certainly not felt like fine tuning. In this talk, I have tried to suggest some ways in which policy might be approached a little differently, but without moving away from the month-by-month decision-taking which has served the UK well. There is presently much uncertainty about the size of the output gap, partly as it is not easy to reconcile a large negative output gap with recent upward surprises on inflation.

Let me complement that with one for markets: “Adapt and survive”. But let me add the positive rider - “Those who survive will thrive”. What is the role of the authorities in this future I have described? It is, very simply, to provide as best we can the economic and regulatory environment in which financial markets can do their job - of allocating capital to where it can be most productively deployed - more effectively. On the economic front that means steady growth with low inflation. On the regulatory front it means a framework of rules that provide for the transparency that is essential for the proper assessment and management of risk and sets clear behavioural standards which do not unnecessarily distort business decisions but provide clear guidance to market participants - whether they are end-users or intermediaries - as to what is expected of them and what they can reasonably expect of others. The picture I have painted is one of challenge and change. The flip-side of course is great opportunity. In fact there has never been a time when the markets here in London did not face change and uncertainty. But there has never been a time either when you, we, all of us, did not rise to the challenge. I am sure we will all do so again - and I wish you all possible success. 3  BIS Review 15/2000
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Markets might then react by driving up long-term interest rates. The premature tightening of financial conditions could then trigger increased volatility in financial markets, especially in economies that have yet to emerge from the pandemic and those with higher fiscal or external funding needs. In sum, while the global economy is in a much better place compared to last year, uncertainty remains as elevated. What has changed is the nature of the uncertainty. Last year, we were uncertain how far down the economy will go, in the face of an unprecedented pandemic. This year, the uncertainty is in both directions: a much stronger recovery or a much 2/9  BIS central bankers' speeches  dampened one. SINGAPORE ECONOMY The Singapore economy had recouped in the first quarter of 2021 the aggregate output loss incurred during the pandemic. The recent tightening of domestic restrictions and border controls will cause a near-term setback to segments that make up about 8% of the economy. The consumer-facing industries (retail trade, food & beverage, and land transport services) will be most affected by the tightening measures. The travel-related industries (air transport, accommodation, arts, entertainment & recreation) are likely to see further delay in their recovery. Construction and marine & offshore engineering activity may be hindered by labour shortages from the border restrictions on the entry of foreign workers. But the economic impact of the current restrictions will be significantly less severe than during the circuit-breaker last year. The majority of businesses remain in operation.
Regarding the international reserve management, regulatory amendments have been made to clarify the function of international reserve management and the responsibilities of decisionmaking structures, as well as to broaden the range of investment instruments in compliance with the adopted policies. As at end-2017, the international reserve was around EUR 3 billion, sufficient to cover 6.7 months of imports of goods and services, and 178% of the short-term external debt. The yield on its investment was slightly negative, due to the low interest rates of euro in international markets. The economic and financial analyses and the decisions of the Bank of Albania are based on a broad research work within the institution. The Bank of Albania deems that the investment in human resources and in research techniques is always rewarding, taking into account the rapid structural changes in the economy and in the financial markets. The monetary policy transmission, the safeguarding of financial stability, the banking supervision and the coordination among these objectives were the main focus of working papers during 2017. The results are shared with national and international experts in scientific panels and are published in working papers. Also, the international experts have continued to assist to improve the macro-economic and statistical models, which support Bank of Albania projections. Public communication is an important pillar in Bank of Albania’s activity for enhancing the transparency and public confidence in the institution. The classic channels of communication are supplemented with digital platforms, such as Twitter (information), YouTube (video) and Flicker (photos).

Jon Cunliffe: Credit – can trees grow to the sky? Speech by Sir Jon Cunliffe, Deputy Governor for Financial Stability of the Bank of England, at the British Property Federation Annual Residential Investment Conference, London, 9 February 2016. *  *  *  Accompanying charts can be found at the end of the speech. Evolution of private credit In 1880, the stock of aggregate bank lending to the private non-financial sector in the British economy was around 16% of GDP.1 It grew, gradually, over the next 100 years, except in the periods of the first and second world wars, when it fell sharply. In 1950, the stock of aggregate lending which includes credit provided by non-bank institutions, was 63%. It rose and fell of course but it broadly stayed around that level for the next 30 years. It was 63% in 1980. The rate of growth changed markedly in the last 20 years of the century which was a period of first liberalisation and then globalisation of the financial sector (Chart 1). Credit began to grow consistently faster than the economy. As a result, the stock of credit increased rapidly from 63% of GDP in 1980 to 120% by the early 1990s. It paused for a few years following the recession of the early 1990s, and then resumed its upward path. By 2009 it had reached 177% of GDP – one and three quarter times the annual product of the economy. In aggregate, advanced economies saw a similar upward trend (Chart 2).
At this point, a financial regulatory reform was necessary at international level, to address such risks. Under the guidance of the G20, broader and more comprehensive regulatory reforms were designed, with a special contribution by Basel Committee, the Financial Stability Board, IMF/WB group and many other. Such reforms were aiming to: •  strengthen the resilience of the financial system;  •  avoid future similar crisis;  In more details, such reforms included: •  Improving the surveillance superstructure of the financial system, through:  –  establishing institutions with macro-prudential powers to monitor, assess and address systemic risk (in EU – ESRB, ECB; in US – FSOC; in UK – FPC; etc.

Inflation and Supply-Chain Challenges One of the foremost concerns surrounding the outlook is inflation, which rose considerably last year. There are two main contributors to the current high inflation: very strong demand, especially for goods, and supply bottlenecks. Both have been prevalent throughout the pandemic. The shutdown of factories—particularly those in Asia—and widespread lockdowns led to disruptions to logistics networks, elevated shipping costs, and prolonged delivery times. A new index created by New York Fed research staff shows that global supply-chain pressures shot up last year, reaching historically high levels.1 These challenges are not just top of mind for companies selling their goods or consumers waiting for their purchases to be delivered. Elevated prices have real life consequences for so many, particularly for people who are struggling to cover the rising costs of food, housing, and transportation. The circumstances we are facing today are unlike anything we’ve experienced in the past. 2/3  BIS central bankers' speeches  Typical historical episodes cannot be used as reference points for current conditions. As an example, the very large increases in prices that we see today are primarily for durable goods. This is a striking turnaround from the past 25 years when those prices had been trending lower. In contrast, even with the recent increases, prices on services and non-durable goods are now fairly close to their longer-run trends. And, even though the Omicron wave is posing new obstacles, some supply issues are starting to work themselves out as the economy adjusts to the changing circumstances.
In addition, emerging-market rates have become extremely sensitive to global monetary policy developments. To contain repercussions on the Turkish economy, we designed a monetary policy framework composed of a wide interest rate corridor and an active liquidity policy. The CBRT’s wide interest rate corridor and the tight liquidity policy strengthened the resilience of the Turkish economy against global shocks and proved to be effective in pursuing the primary objective of price stability. The wide interest rate corridor enables us to raise shortterm rates temporarily above long-term rates when faced with shocks and to keep the yield curve nearly flat or inverted. Accordingly, Turkish lira-denominated long-term rates remain more stable and the economy becomes less sensitive to global long-term interest rate shocks. Moreover, a flat or inverted yield curve constitutes an effective monetary policy stance that supports disinflation. In fact, especially following the strong monetary tightening of early 2014, we all saw that the sensitivity of domestic markets to global interest rates weakened substantially and core inflation indicators have improved significantly (Chart 7). In the upcoming period, following the start of normalization of global monetary policies, volatility in long-term interest rates may decline permanently thanks to forward guidance policies. According to this baseline scenario, the need for a wide interest rate corridor in our country may diminish over time. In that case, we may simplify the operational framework of the CBRT’s interest rate policy gradually.

The combined balance sheets of the then five major investment banks totaled $ trillion. In comparison, the total assets of the top five bank holding companies in the United States at that point were just over $ trillion, and total assets of the entire banking system were about $ trillion. This parallel system financed some of these very assets on a very short-term basis in the bilateral or triparty repo markets. As the volume of activity in repo markets grew, the variety  BIS Review 74/2008  1  of assets financed in this manner expanded beyond the most highly liquid securities to include less liquid securities, as well. Nonetheless, these assets were assumed to be readily sellable at fair values, in part because assets with similar credit ratings had generally been tradable during past periods of financial stress. And the liquidity supporting them was assumed to be continuous and essentially frictionless, because it had been so for a long time. The scale of long-term risky and relatively illiquid assets financed by very short-term liabilities made many of the vehicles and institutions in this parallel financial system vulnerable to a classic type of run, but without the protections such as deposit insurance that the banking system has in place to reduce such risks.