samchain/econo-pairs-v1 huggingface dataset:
In addition, there is no previous experience of structural changes of this magnitude, which also require a very long-term perspective, and where the presence of non-linearities and irreversible tipping points are likely, conditioning the methodologies to be used. And there is limited research, and accompanying data, that explore how climate risks feed into the financial risks faced by banks. In this context, many supervisory and/or prudential authorities are opting to use stress tests and scenario analysis. The Bank of Spain is indeed preparing such stress tests for the Spanish banking sector and the results are expected to be published in Autumn. 3  A Pigouvian tax is assessed against private individuals or businesses that engage in activities with adverse side-effects for society that are not internalised by these private agents, as a result of not being an integral part of the costs and prices they face. In any case, recognition should be given to the fact that the efficacy of Pigouvian taxes may have a limit. This is because, at some point, the supply of polluting energy inputs may be so elastic that it absorbs all the taxes levied on them, without affecting demand. At that point, quantitative restrictions could become the best option. 4  As a result, we should accept that efforts to translate climate-related risks into quantifiable financial risks are in their early stages. And we will have to step up our efforts to address these problems and limitations.

Negative interest is intended to make it less attractive to hold large amounts of liquidity in Swiss francs. It is thus logical from a monetary policy perspective that banks which hold large quantities of Swiss franc liquidity relative to the size of their balance sheets should shoulder a heavier burden. As already mentioned, the introduction of negative interest rates on sight deposits at the SNB has also caused longer-term interest rates to fall. And yet, we have been living through a period of exceptionally low interest rates for around six years already, with even long-term investments bearing virtually no interest. The Swiss are a nation of savers and many people are concerned about low interest rates. I understand this, however we should not forget that what really counts for savers is not the nominal but the real (i.e. inflation-adjusted) interest rate. For some time now, inflation has been very low and now it is even negative. If inflation is negative, the real interest rate is higher than the nominal interest rate. As chart 5 shows, there have often been periods in the past when real interest rates were even lower than they are today. During this challenging phase for the Swiss economy, it is important that the negative interest rate be allowed to take effect and help to bring about a weakening of the Swiss franc. Efforts to circumvent negative interest rates by obtaining exemptions or shifting to cash are not in the interests of Switzerland as a whole in the current climate.
If so, presumably this should be supported by other central inflation indicators, such as the overall utilisation of resources in the economy. If one is sufficiently convinced about this, there is, as I see it, an argument for taking action. But precisely as with the previous case involving deregulations, it is necessary to make a good case for deviating from the normal rule. It is also necessary to make clear what one stands to gain by acting now. This leads me to the question of what approach central banks should take to developments in asset prices which are not thought to immediately endanger price stability, but which risk leading to financial  2  BIS Review 38/2001  imbalances or real imbalances. There is no consensus on this in the academic literature. The prospect of intervening immediately poses the next question: how can we know if an asset is over-valued or not? If one does decide to act, a third question is raised: how can one burst the "bubble" in an organised way? Listing these problems is usually sufficient to make many of my colleagues in the central bank world come to the conclusion that monetary policy should not be used to try to stabilise asset prices. My own opinion on this question is, however, somewhat different. In any case, it is reasonable to put the argument in a larger perspective. Apart from price stability, the Riksbank has the objective of promoting an efficient and stable payment system.

Less clear principles for policy in combination with reduced transparency regarding, for example, the reasons for making decisions, will hardly lead to a policy which will be more successful in the future. Many years' experience in the vicinity of economic policymakers suggests to me that the opposite is  4  BIS Review 38/2001  more probable. Among the most important things one can do in this type of work is to try to build up clear processes which contribute to decision data, based on good economic analyses, being produced in a systematic way. And that this decision data is subjected to as wide an examination as possible. I am convinced that our ambition to be as clear and open as possible has served us well. Starting with a numerical, symmetric objective and a guiding rule, in the way that we have done, we have been forced to think through every question with which we have been confronted in a more precise manner. This has resulted in our gradually increasing our understanding in a way which I think would hardly have been possible otherwise. Certainly it is not yet over, and in this context, future developments will place new demands on us and impose further intensification and exactitudes. There is also a connection between transparency in relation to the outside world on the one hand, and internal work on the other. In getting rid of secrecy we were able to introduce a more realistic debate on monetary policy.
An even bigger portion of the reduction in the use of labour has been in the form of the recourse to furlough schemes (ERTEs by their Spanish name). Indeed, in late September, work for almost 730,000 workers (a still-high figure, although it is admittedly almost 80% below the April high) was still fully or partially suspended. The series of actual Social Security registrations, constructed stripping out the figures for workers on furlough, still showed, on average monthly data, a year-on-year decline of 6.2% in September. The path of progressive recovery observed since May held up in September, albeit at a lesser pace than in the previous months. Moreover, heterogeneity across the productive sectors is very high. Compared with the pre-crisis level, the decline is particularly marked, in percentage terms, in certain services such as hospitality, which is particularly affected by the social distancing measures. Moreover, in absolute terms, the sizeable fall in actual registrations in this sector is indicative of the importance of tourism for Spain’s economy. 2  See Box 1 (“Macroeconomic scenarios for the Spanish economy (2020-2022)”) in the “Quarterly Report on the Spanish Economy”, Economic Bulletin, 3/2020, Banco de España. 3  In the coming quarters employment, in terms of hours worked, is expected to follow a very similar path to that of economic activity, showing declines of over 10% in 2020 and a subsequent recovery. Meantime, the increase in unemployment is being contained in the short term by the resort to furlough arrangements.

The aim is to mobilise the EUR 390 billion savings surplus of the euro area last year, notably to shore up equity which is the key to an innovation economy, and also to foster synergies, thanks to an integrated steering mechanism, between the Juncker investment Plan, the Capital Markets Union and Banking Union. The fiscal accelerator could be a euro area investment budget used to finance, for the benefit of all countries, certain “European common goods” such as digital technology, energy transition, security, and migration controls. If there is such progress on substance, in terms of institutions, we would need a euro area Finance Minister, President of the Eurogroup and member of the Commission, backed by a European Treasury; but also a euro area Parliament group, in order to ensure the democratic legitimacy of the institutions and decisions. [slide 15]  *** France is heading in the right direction and at a fast pace, with a strong government commitment to reforms. I stress it as fully independent Central Banker. France is changing for the best. But France is not alone obviously. The European and international environments need to remain supportive. In terms of economic upturn first, but also in institutional terms. A country cannot implement the appropriate structural reforms, improve its flexibility and attractiveness and then face a major disruption in international trade, reducing the pay-offs of such a political effort.
Jan F Qvigstad: Could the financial crisis have been avoided? Challenges to international cooperation and conflict Speech by Mr Jan F Qvigstad, Deputy Governor of Norges Bank (Central Bank of Norway), at a seminar on the financial crisis arranged by Prio, Oslo, 8 December 2009. *  *  *  What happened? Confidence between financial market participants collapsed in September last year following the Lehman Brothers bankruptcy. The price of credit jumped up both in money and bond markets. Equity prices declined, increasing the cost of raising new equity capital. The authorities worldwide responded by supplying substantial liquidity to banks and central bank key rates were reduced. In many countries, the authorities provided extraordinary loans or took over banks to maintain confidence in institutions and market activity. In some countries, the authorities have purchased securities to bring down long-term interest rates. Stimulus has also been provided through increased public sector demand and government budget deficits have grown to unprecedented levels in some countries. The reaction of households and businesses was to increase saving and private sector demand declined. Credit standards were tightened and risk premiums soared. The drop in demand rapidly translated into a contraction in trade and output. In spring 2009, world trade was around 20 per cent below the level prevailing one year earlier. In many countries, the total value of goods and services production (GDP) declined over several consecutive quarters. Countries that were heavily reliant on exports of manufactured goods were particularly hard hit.

In this context, the SNB fully supports FINMA’s efforts to ensure that risk-taking by individual banks is reduced or backed by specific capital charges whenever the risk exposure is deemed exceptionally large by historical or industry standards. In parallel with these measures, the SNB will continue to monitor developments on the mortgage and real estate markets closely, and will reassess the need for an adjustment to the CCB on a regular basis. BIS central bankers’ speeches  3
What objectives should a central bank have? The most fundamental question to ask when one is on the point of reforming the monetary policy framework is, of course, what the objective of monetary policy should be. On a very general level the objective of monetary policy can be said to be to create an environment where the economy can develop in the best possible manner. However, this definition is too general to be of any great practical use, although it excludes some tasks that are sometimes imposed on central banks. To obtain a more operational definition, it is necessary to take the discussion one step further and ask the question of how monetary policy can contribute to favourable economic development. On a fundamental plane, one could say that the central bank’s main task should be to ensure that the payment system in the economy functions efficiently. This means in simple terms that payments and financial transactions can be made easily and smoothly and entail as little risk as possible. Many scholars also regard this as the main reason why central banks were originally founded 1 . An economy’s payment system can be regarded as a sort of infrastructure in roughly the same way as the country’s communications network or energy supply system. It also essentially fulfils the same purpose, i.e. to ensure that the flows essential to the economy – in this case the flow of money – functions properly.

The Riksdag’s possibility of sanction is to replace a member of the executive board each year, as the members of the executive board have varying periods of office. The Chairman and Vice-Chairman of the Governing Council of the Riksbank follow the executive board’s work by having the right to attend and speak at board meetings. This is how it must be in a democracy. Delegation of power must be accompanied by a possibility of holding to account. By the Riksbank being open about its objectives, its forecasts and the assessments that have been made by the executive board, confidence can be established in the Riksbank’s policy among politicians, investors and the general public. I consider that Sweden has a found a reasonable and balanced approach to implementation of the EU directive. 5. Are there alternatives? We have thus noted that Sweden has undertaken a fundamental change of policy. From having directed stabilisation policy at full employment as the highest priority, policy has been realigned to create stability. Low inflation is to constitute the economic environment in which full employment shall be restored. 7  BIS Review 59/1999  The objective of “price stability” is delegated to an autonomous Riksbank instead of – as previously – fiscal and monetary policy being co-ordinated by the Government to achieve both full employment and price stability. Full employment is aimed at by long-term economic growth. I have given a fairly detailed account of the failures of stabilisation policy that have led to this change of course.
For nearly 20% of companies the premium was more than 150bp. Today, in almost no case is it more than 150bp. (slide 5)  But according to the models used by banks to assess creditworthiness, based on company balance sheet characteristics, default probabilities have barely changed. 3  In global debt markets, investors seem to be willing to take the same risk for less compensation. Appetite for risk taking has increased. Now, coming closer to home, consider this:  2  That confidence is also apparent in measures of interest rate volatility implied by options and in the pricing of credit default swaps. These model assessments are submitted to Credit Benchmark, to whom I am grateful for permission to use the data (www.creditbenchmark.com) 3  4  All speeches are available online at www.bankofengland.co.uk/speeches  4  As I noted back in February, the premium on a basket of sterling-denominated investment grade bonds is close to zero.4 (slide 6)  While the average sterling-denominated investment-grade corporate bond has got riskier in recent years, with a longer duration and lower credit rating, this basket has a fixed composition. And the compression of the yield premium has been even more pronounced at the riskier (‘high yield’) end of the market. The focus of explanations of these developments, globally and in the UK, is often on QE.

Mohd Razif bin Abd Kadir: Promoting the takaful industry in Malaysia Speech by Mr Mohd Razif bin Abd Kadir, Deputy Governor of the Central Bank of Malaysia, at the Launch of ING Public Takaful Ehsan, Kuala Lumpur, 5 April 2011. *  *  *  It is my pleasure to be here with you this morning for the official launch of ING Public Takaful Ehsan. Indeed, this momentous occasion, which also celebrates an alliance between ING Management Holdings (M) Sdn Bhd, Public Bank Bhd and Public Islamic Bank Berhad, signifies yet another milestone in our continuous endeavour to provide sufficient financial safety net for the general population and at the same time, promote the development of a progressive takaful industry, that is agile, dynamic and able to adapt to the increasingly challenging environment. In 2009, Bank Negara Malaysia unveiled the plan to issue 2 new family takaful licences as part of the initiative to increase the penetration rate of insurance and takaful as well as to further liberalise the financial sector. Despite the prevailing tough global economic conditions and uncertainties in the international financial environment back then, an overwhelmingly strong number of applications were subsequently received, which led to the issuance of 4 family takaful licences instead of 2 as originally planned. This speaks volume of the interest and confidence of leading market players in the growth prospects of the takaful industry in Malaysia. For more than 2 decades, the takaful industry has been blessed with tremendous growth and strong performance.
And the prediction is that Iceland will grow even faster during the next two years, or in the range of 3½–4% per annum, causing the slack in the economy to disappear and the unemployment rate to fall to around 4%. 2  BIS central bankers’ speeches  So how did we get here? In answering this question, we need to remember that subsequent developments were not only a function of the negative shocks hitting the economy in 2008 but also a function of the policy responses. In addition to crisis management vis-à-vis the failing banks, which I have already mentioned, the economic programme that the Icelandic authorities developed in co-operation with the IMF played a key role. It provided financing amounting to 5.1 billion US dollars, which helped to build FX reserves. The programme had three key goals: stabilisation of the exchange rate, fiscal sustainability, and reconstruction of the financial sector. Comprehensive capital controls were a key element in the programme. Fig. 3  BIS central bankers’ speeches  3  The policy responses mitigated the recession but could not stop it from becoming the deepest in Iceland’s post-war history and a severe one in international comparison as can be seen from Figure 2. Iceland was not the hardest hit, however, as can be seen from this slide. Furthermore, developments were more or less in line with previous Central Bank of Iceland predictions (see Figure 3). The result was that Iceland fell significantly down the League of Nations.

The currency played a significant role, both in the build-up to the crisis and during subsequent stabilisation and recovery. The currency crisis materialised in an over 50% depreciation of the króna over the course of 2008. It hit highly indebted corporate and household sectors, a large share of whose debt was either denominated in or linked directly to foreign currency, or linked indirectly to it through price indexation at a time of strong and rapid exchange rate passthrough. The contractionary balance sheet effects of the currency depreciation were therefore substantial. Hence the need to stabilise the exchange rate, which was achieved in the middle of 2009. But the real depreciation – which took the real exchange rate to around 30% below its historical average for a time and left it at the current level of around 20% below that average – compressed imports and provided some stimulus to exports, thus helping to turn a double-digit current account deficit into an underlying surplus. But the stimulus to exports is limited by the fact that Iceland’s major export industries, such as fisheries and energy-intensive metal smelters, face capacity constraints that can only be lifted through investments that have been rather limited so far. 4  BIS central bankers’ speeches  BIS central bankers’ speeches  5  A very important and somewhat novel element of the successful policy response was the interplay of fiscal consolidation, monetary policy, and capital controls. The crisis dealt a heavy blow to government finances in Iceland, as can be seen from Figure 5.
The Board of directors shall consist of not less than 5 members (Section 30(2);  iii. Every financial service provider must have a Chief Executive Officer and Chief Financial Officer who shall not qualify to hold office unless it is shown that they are fit and proper persons, above 21 years old, have not been convicted of a felony or offence involving dishonesty, are not mentally incompetent, have never been removed from office under the BFSA, have not managed a company that has gone into liquidation or entered into a composition with creditors (Section 31);  iv. The majority of directors must be from outside the bank (Section 32(1);  v.  Directors, Chief Executive Officers and Chief Financial Officers are expected to act honestly, in good faith and in the interest of the company whilst exercising due care, diligence and skill (Section 33);  vi. A director is required to declare in writing to the board annually, the names and addresses of the director’s associates and full particulars of every material interest (Section 35);  vii.

It is sometimes claimed in the media that there is a link between the Riksbank’s closure of its depots and the increase in cash transport robberies. I would doubt that claim. First and foremost, it must be remembered that approximately 85 per cent of the cash transports that are attacked are on their way to ATMs, and the Riksbank has never been involved in these transports. Only a very few transports to or from our offices have been the target of robberies. Furthermore, the large increase in the number of robberies took place while the Riksbank still had a network of cash depots throughout Sweden. One possible explanation for the increase in the number of cash transport robberies, which has been suggested by the Swedish National Council for Crime Prevention (BRÅ), is that criminality may to some extent have been transferred from robbing banks and post offices to robbing cash transports. Other possible explanations, according to BRÅ, are that cash transport robberies yield much larger amounts than bank and post office robberies, while increased security in post offices and banks may have discouraged prospective robbers. I think that we should ask the question of why Sweden has so many more cash transport robberies than other countries, not just other Nordic countries, but the majority of European countries. There have occasionally been suggestions put forward in the general debate that if one tried to reduce the use of cash in society, the number of transports to ATMs could be reduced.