samchain/econo-pairs-v1 huggingface dataset:
The evidence suggests that investors in funds which offer short notice redemptions and that invest in less liquid assets tend to redeem more in response to a downturn in the funds’ performance than those in more liquid funds. And the redemption behaviour of investors in bond funds seems to have become more sensitive as these markets have become less liquid. 19, 20  Drawing these developments together, it’s possible that just as corporate bond markets have become less liquid, they may have become susceptible to greater selling pressure after a shock. We may have more of a mismatch of liquidity. That could amplify any price adjustment. None of this is conclusive and serious problems have not been caused by this in the past. But we have a duty to take the possibility seriously – to ask ‘could it happen?’ With markets having evolved so much in the past decade, the absence of problems in the past is no guarantee for the future. That’s why we’ve been developing simulations of the impact of this liquidity mismatch. The asset management industry has been a constructive partner in this work. I hope we and this Centre can collaborate as we take this work forward. There is much more to do, but our initial work suggests a case for exploring further, including by incorporating a range of other investors into the simulations and assessing the impact not just on bond markets but on the wider economy. You can expect to hear more from us as these efforts develop.

(2015), suggest that the average cost of a financial crisis has been 73% of GDP, which translates to a cost of roughly £ 20,000 per capita if a financial crisis had taken place in 2016. 2 For example, Bunn and Rostom (2015) find that, during the financial crisis, highly indebted UK households, with loans four times larger than their income, reduced their consumption relative to income around three times more than UK households with loans between one or two times their income. 2  All speeches are available online at www.bankofengland.co.uk/speeches  2  So today I want to consider one of these next frontiers for macroprudential policy: market-based finance of companies. The nature of corporate finance has shifted decisively in the past decade. Since the crisis, nearly all net finance raised by private companies in the United Kingdom has been through the issuance of equity and bonds. Market-based finance has been the spare tyre to what was, after the crisis, a punctured banking system, unable to lend. The scale of businesses borrowing through issuing bonds is now on a par with their borrowing from UK banks. The shift in the balance of corporate finance should be a positive for stability. A more diverse system can be a safer system. The challenge for macroprudential policy is to ensure this source of finance develops sustainably and safely, so that its users can have confidence in the service they get from it, and the wider economy need not fear it. That challenge is not a distant one.
Joseph Yam: Financial integration and regulation Remarks by Joseph Yam, Chief Executive of the Hong Kong Monetary Authority, at the conference: The Euro: Lessons for European and Asian Financial Markets, Hong Kong, 24 February 2006. *  *  *  Ladies and Gentlemen, 1. It is a great pleasure for me to open the proceedings of this conference on “The Euro: Lessons for European and Asian Financial Markets”. It is also an honour for the Hong Kong Monetary Authority to be co-sponsoring this event with the European Commission. The programme is a very rich one and it will be impossible for me, in these opening remarks, to cover all the topics to be discussed later this morning and in the afternoon. I do notice, however, that the words “financial integration and regulation” appear in several of the session titles. These are topics close to my heart, because I have come to believe that they can influence profoundly how Asian economies develop in the years ahead. Well managed financial integration, combined with sound regulatory practices, can help the region maximise its economic growth potential while maintaining financial stability. I have chosen therefore to focus on these topics. 2. I will try and lay out a case for closer financial integration in Asia, both as a means of achieving more efficient allocation of resources in the region, thereby contributing to continued economic growth, and as a means of supporting financial stability.

As a major interface between Europe and the rest of the world I have little doubt that euro-activity in London will mean more rather than less euro activity in other European financial centres like Frankfurt, Paris, Milan, Amsterdam or Copenhagen. And I have little doubt either that what is good for those centres will be good too for the City. Thirdly, and perhaps most fundamentally, the United Kingdom, even while it does not participate in the euro, can contribute to its success by continuing to pursue macro-economic, both fiscal and monetary, discipline in parallel with the euro-area countries. The Government is committed to this course as a matter of national economic self-interest - one of its very first acts in Government for example was to hand operational independence for the conduct of monetary policy to the Bank of England. But these same policies are calculated, too, to make us a more prosperous and active trading partner for Europe as a whole, and to ensure that we do not have any avoidable disruptive effect on the policies or on the economy of the euro participants. More than this they are calculated to foster sustainable economic convergence as the necessary precursor to our eventual adherence to the euro club. And in the meantime the British Government will continue to pursue, and to advocate in the councils of Europe the supply-side flexibility that will be vital to its success.
It is often referred to as the distributed ledger’s native currency, used as a medium of exchange and store of value within the network, for example to pay transaction fees or incentivise users to keep the network secure. But cryptocurrencies have taken a life of their own outside of the distributed ledger – and this is the source of the crypto world’s problems. Cryptocurrencies are actively traded and heavily speculated upon, with prices that have nothing to do with any underlying economic value related to their use on the distributed ledger. The extreme price volatility of cryptocurrencies rules them out as a viable form of money or investment asset. This speculation in cryptocurrencies is what MAS strongly discourages and seeks to restrict. Let me now elaborate on Singapore’s strategy to develop a digital asset ecosystem as well as our regulatory approach to manage the risks of digital assets. SINGAPORE’S STRATEGY TO DEVELOP A DIGITAL ASSET ECOSYSTEM Our vision is to build an innovative and responsible digital asset ecosystem in Singapore. This is a core part of MAS’ overall FinTech agenda. As with everything else we do in FinTech, innovation through industry collaboration is key to growing the digital asset ecosystem. Crypto technologies are promising and there is great potential to improve financial services – this is a common goal shared by MAS, the financial industry, and the FinTech community. But the only way to find out what works is through experimentation and exploration – “learning by doing”.

MAS does not see a compelling case for retail CBDCs in Singapore. Retail CBDCs are issued to the general public. They are like the cash we carry with us, except in digital form. The case for a retail CBDC in Singapore is not compelling for now, given wellfunctioning payment systems and broad financial inclusion. Retail electronic payment systems are fast, efficient, and at zero cost, while a residual amount of cash remains in circulation and is unlikely to disappear. Nevertheless, MAS is building the technology infrastructure that would permit issuance of retail CBDCs should conditions change. MAS has been actively experimenting with digital currency connectivity since 2016. On the international front, MAS is participating in Project Dunbar, which the Bank for International Settlements Innovation Hub is working on in its Singapore Centre. The project is exploring a common multi-CBDC platform to enable cheaper, faster and safer cross-border payments. Domestically, MAS is working with the industry on Project Orchid to develop the infrastructure and technical competencies necessary to issue a digital Singapore dollar should there be a need to do so in future. ANCHOR PLAYERS WITH STRONG VALUE PROPOSITIONS AND RISK MANAGEMENT MAS seeks to anchor in Singapore crypto players who can value add to our digital asset ecosystem and have strong risk management capabilities. A vibrant digital asset ecosystem will encompass a wide range of value-adding activities. Let me cite three examples. JP Morgan has established its digital asset capabilities in Singapore via its Onyx division, which has pioneered several DLT-based products and initiatives.
In this regard, the DFIs play an important role in providing the necessary financial and developmental support to complement the banking institutions in the promotion of SME development. I am pleased to note that we have distinguished speakers and panellist here to share their views on various issues relating to DFIs and their roles in SME financing. I am confident that your endeavour to learn and share, as well as to exchange views on areas that are of particular interests and benefits to you, will, in the final analysis, be very rewarding. 5/5

And if the advanced countries’ consumption stops growing, what will happen to global economic growth and particularly that of emerging countries with entirely export-oriented economies? Which brings me to my third remark: we need the emerging countries to continue investing their savings in advanced countries. We therefore need properly functioning international financial markets. In a world where the savings and financing needs are so geographically dislocated, properly functioning financial markets are a prerequisite for economic growth. But, today the capital markets appear very unsettled and full of anomalies, and not just in Europe. •  For example, certain sovereigns (the USA and UK for example) borrow today at historically very low nominal interest rates and at negative real interest rates despite the fact that their deficits are around 10% of GNP and that doubts exist regarding the future evolution of their debt levels. •  Another anomaly: large corporations have accumulated unprecedented cash reserves (several trillions of dollars) despite numerous highly profitable and unexploited investment opportunities around the world, unsatisfied infrastructure needs and investment bottlenecks in commodities production. Fourth remark. We can identify two reasons for this situation: •  The first is the general and exceptional uncertainty weighing on the global economy. Uncertainty makes liquid and safe assets more attractive. It makes investment less attractive. It can therefore partly explain the phenomena that I have mentioned. •  The second reason is more structural: a malfunctioning of our financial intermediation mechanisms. There are doubts about the solidity of banks in numerous countries.
Firms whose failure is unlikely to have financial stability consequences also have a part to play: they need to take a forward-looking realistic assessment to ensure they prepare for the event that they fail, which is likely to be a bank insolvency, and meet PRA rules on The RAF applies to such firms where they are a ‘material subsidiary’ of an overseas-based banking group for the purposes of setting internal MREL in the UK. 20  9  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  9  depositor protection. In placing an emphasis on the responsibility of individual firms to understand and plan for their own resolution, we are making firms accountable for this essential planning, reinforcing the credibility of those plans and the regime as a whole. Conclusion  Resolvability is better regarded as a spectrum than as a binary judgement. It is about ensuring authorities have credible options and the flexibility to respond to a crisis. A resolution is ultimately a transaction which occurs in a crisis situation and is unlikely to ever be a smooth process. But the work done by firms under the RAF should increase the chances that resolution is conducted in an orderly fashion and disruption to the financial system is minimised. Banks and building societies need to prepare themselves fully for these situations now.

As a result of these various failings globally and domestically the financial system acted as an amplifier, intensifying the UK economic downturn at great economic and fiscal cost. Budget 2009 detailed the largest fall in UK GDP since the Second World War and forecast a near doubling in the fiscal debt ratio in just four years, from 36% of GDP in 2006-07 to 69% in 2010-11. In order to underpin the UK’s economic and fiscal position, the Government took the unusual step, at least in public finance terms as I am sure this expert audience would appreciate, of making, what amounted to, a provision of up to £ or 3½% of GDP, for expected losses on its many and various interventions in the UK banking system.3  Clearly, the options authorities had to manage the failure of financial firms were insufficient, which led to some difficult and disruptive choices. The lack of a credible resolution framework is self-evident in the scale of taxpayer bailout. Of course, in the absence of the counterfactual, it is impossible to precisely quantify the impact of the lack of a credible regime. But I agree with my colleague, Jon Cunliffe, that the negative impact was likely to be considerable.4  Transparency around what is likely to happen if a bank fails is a fundamental complement to a credible resolution regime. Authorities previously relied upon it being ‘constructively ambiguous’ as to whether or not they would bail out a failing bank.
Not only is the federal funds rate trading close to the middle of the new 25 to 50 basis point target range, but the entire complex of money market rates, such as LIBOR deposits and GCF repo, has also risen as well. Moreover, apart from a temporary spike in usage around year end, which was expected, the usage of the overnight, fixed rate reverse repo facility has fallen back to levels similar to what we saw during the testing phase. In recent days, usage has averaged less than $ billion per day. Thus, the facility has been absorbing only a small fraction of the $ trillion of excess reserves in the banking system. This demonstrates that to firm interest rates, we don’t necessarily have to drain reserves or shrink the size of our balance sheet. We are very pleased by how well our tools are working, and this has reinforced our confidence that they will support the policy normalization process going forward. This is what we expected given our extensive testing, but there are always uncertainties that only can be resolved by actually getting underway. For example, there was some residual uncertainty about how important a factor the zero lower bound of interest rates had been in supporting the federal funds rate and other money market rates. This uncertainty now has been at least partially resolved. Even as we have moved away from the zero lower bound, the relative yield relationships we saw before December’s federal funds rate hike have persisted.

On the asset side it is a question of changes in the gold and foreign currency reserve linked to the sale or purchase of foreign currencies. Such interventions are very rare and usually affected by our own decisions. Other items in the Riksbank’s balance sheet only show small and predictable changes. The total of the estimated changes in the balance sheet corresponds to how much  4  BIS Review 51/2008  the bank system’s borrowing requirement is expected to change over the coming week. Compared with many other countries, it is easy to make forecasts of the Swedish bank system’s borrowing or investment requirement. This is partly because the government transactions no longer go via the Riksbank, and there is very seldom a need to make currency interventions when one has a floating exchange rate. In a second stage, the actual loan transaction is carried out by means of what is known as a repo. The monetary policy repo means that the bank system borrows money from the Riksbank against collateral, with an agreement to “repurchase” a week later. When the repo matures, the banks pay interest on the past week’s loans, that is the repo rate. At the same time a new repo is carried out. The conditions for the repo are normally announced every Tuesday and the repo runs from Wednesday to Wednesday.
The high level of investment has been almost entirely financed through domestic savings. The saving ratio in China amounts to around 45 per cent of GDP, which is a much higher level than in most other countries. According to estimates, Chinese households save one third of their incomes. One reason for the high level of saving is the lack of a social safety net and a general pension system. As a consequence of the high level of saving, private consumption is relatively low. China has had relatively strong growth in exports; in the past five years alone exports have trebled. 4 The country is currently a nation as open as, for instance, France and Italy, measured in the percentage of foreign trade in GDP and considerably more "open" than the United States. China has come to be called “the factory of the world” as an increasing number of foreign companies have chosen to purchase goods and locate parts of their production there. For instance, China manufactures more than two thirds of all photocopiers, microwave ovens and DVD players, and 40 per cent of all of the world’s computers. 5 However, a large part of the input goods for these products are imported from neighbouring countries, but the prevalent picture that China can only compete with lowcost products is slowly changing. In recent years China has gone from specialisation in simple, labourintensive low-cost products to also producing more technically-advanced and internationallycompetitive products.

Given this way of thinking, our Inflation Reports contain a special section where we discuss alternative scenarios for inflation and the real economy and the probability that these will materialise. It is the forecast of inflation and the real economy taking into account the risks of alternative scenarios that forms the basis of our monetary policy decisions. Of course, it is not appropriate for a risk analysis to take into account all imaginable risks; not even all those that would have dramatic consequences if they were to materialise. For instance, it is not reasonable, in my opinion, to allow monetary policy decisions to be governed by the risk of global imbalances, as we are unable to affect this development through our own monetary policy. 3 On the other hand, I consider that it is important to always take into account risks that arise from the monetary policy conducted, even if it is sometimes difficult to quantify these risks and calculate their consequences. One problem faced by many central banks with inflation targets, and which relates to this, is the risk of unfavourable developments in property prices and household indebtedness as a result of a long period of expansionary monetary policy. Sweden is no exception here. Both cyclical and structural factors justify the growth rate in household debts and property prices being high over a period of time in Sweden and there is thus reason to take this into account in the normal analysis and forecasting work.
Nor Shamsiah Mohd Yunus: Reshaping Malaysia's future - setting the goal for greater governance and transparency Keynote address by Ms Nor Shamsiah Mohd Yunus, Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the 10th International Conference on Financial Crime and Terrorism Financing "Reshaping Malaysia's Future – Setting the goal for greater governance and transparency", Kuala Lumpur, 30 October 2018. * * * A very good morning to all of you. It is my pleasure to address all of you today at this very important conference. Financial crime. Terrorism financing. Corruption and money laundering. These are heavy words that carry the feelings of outrage and displeasure, amongst others. The United Nations Office of Drugs and Crime estimates that every year globally, a staggering amount of USD2.6 trillion is stolen through corruption. Yet, I suspect, in reality, figures like these are so large that many may find it hard to relate to it. To put it in perspective, the figure is around eight times larger than the Malaysian economy. Let us also take the UN Sustainable Development Goals that aims to improve the lives of the poor, improve governance and address inequality. Some estimate that it will take around USD5-7 trillion to meet all the SDGs. This represents 2-3 years’ worth of money lost to corruption. In other words, the money lost through financial crimes is a devastating opportunity cost, draining the resources that could have been used to permanently uplift the lives of billions in this world.

The challenge facing the UK economy in the years ahead is to ensure that the private sector can once again become an engine of job creation and growth as the public sector rebalances, repeating the positive experience of the 1990s recovery. 6  Public sector net borrowing was 7.7% of GDP in 1993/4, moving towards a surplus of 0.5% in 1998/9, a swing of 8.2% in the public sector financial balance as a share of GDP. The Budget plans show a 9 percentage point swing – from borrowing of 10.1% in the current financial year to 1.1% in 2015/6. 7  From Q3 1991 to Q4 1998, public sector employment fell by 827,000 – a fall of around 14% of the total. The Office for Budget Responsibility projects a fall in 600,000 over the present consolidation, a fall of around 10%. BIS Review 134/2010  7  There is, however, one important difference between the situation now and the mid-1990s in that the flow of finance to support the growth of private sector businesses has been affected by the impact of the financial crisis on the banking sector. For many businesses and individuals, the terms on which they can access lending are much less favourable than before the crisis. In one sense, this is very appropriate in that credit was too freely available in some parts of the financial system in the mid-2000s and this created the conditions for the global credit boom which preceded the financial crisis.