samchain/econo-pairs-v1 huggingface dataset:
BIS central bankers’ speeches  1  Monetary policy in the advanced economies has been extraordinarily loose for a prolonged period of time. It has been unconventional in three important regards. •  First, short-term interest rates are at or close to the zero bound – and have been so for over four years now. •  Second, central banks are purchasing non-traditional assets in large quantities to exert downward pressure on long-term interest rates. This has been going on for close to five years now, with central bank balance sheets in the US and the UK, for example, ballooning to more than three times their pre-crisis levels. •  Third, central banks are providing “forward guidance”, either in the form of commitments not to raise interest rates until certain real economy thresholds are met or plans to expand the monetary base until an inflation target is reached, helping to extend expectations of easy monetary conditions. The overall impact of these measures has been to reduce tail risks in the advanced economies and prevent a sharp deceleration in growth. But they have been less successful in restoring economic growth to pre-crisis trend rates, in the face of deleveraging pressures. Debt-to-GDP ratios in the G3 economies must normalise at lower levels to restore macroeconomic and financial stability. This necessitates a decline in consumption. Banks are less willing to lend, and the private sector less willing to borrow. The relationship between liquidity and credit appears to have broken down.

Monetary policy: containing inflation in a restructuring economy Let me start with monetary policy framework. I will cover two areas: •  First, the continued relevance of the exchange rate in our monetary policy framework. •  Second, the calibration of monetary policy responses within this framework. Relevance of exchange rate as the instrument of monetary policy MAS’ exchange rate-centred monetary policy framework was formalised in the early 1980s. While other central banks sought to control money supply or interest rates, MAS has chosen to focus instead on the exchange rate as its monetary policy tool to keep inflation in check. The exchange rate-centred framework has served Singapore very well for over three decades. As I mentioned earlier, Singapore has had one of the best inflation records in the world despite enjoying one of the fastest rates of economic growth. BIS central bankers’ speeches  3  Let us quickly recall why the exchange rate is MAS’ chosen tool of monetary policy. Singapore is a small and extremely open economy. Total exports and imports of goods are each well in excess of 100% of GDP. •  Imports make up 40% of domestic consumption; the exchange rate is thus a powerful tool to moderate the impact of foreign price changes on domestic inflation. •  Exports are the chief driver of economic growth; and the exchange rate, as a key factor affecting export demand, is thus also an effective means for managing aggregate demand and hence overall inflationary pressures.
Around the same time, Queen Elizabeth granted a monopoly on the writing of assurance policies to Richard Candeler, who led the newly-created Office of Assurances. The Office introduced a system of fees – with the Office receiving a fixed percentage per £ insured 8 – for the production of physical written policies. Both through the creation of the Office and Court of Assurances, and the receipt of customs duties from insurers, the Privy Council in the 16th century – as approved by the monarch – cemented the role of the state in exercising a judicial function and creating an environment of policy registration and anti-fraud conducive to commerce. So, as I see it, this first phase of engagement between the British state and the insurance sector was effectively a trade: dispute resolution services were provided by the state, and insurers contributed some revenue to it in return. Indeed, in the early stages this revenue went directly to Candeler himself. Despite the tight state controls around who could write insurance, the nature of risks being underwritten was granted little oversight – so much so that, for many, the practice of insurance became synonymous with gambling in the 18th century. Perhaps – and I say this with some trepidation here at Lloyd’s – some of the most egregious examples of such behaviour were evident in the marine market. By this point, London had emerged as a centre of excellence in marine risks, due partly to its strategic location on famous shipping routes.

Bottomry, it turns out, was a type of contract whereby a lender would, for a fee, put up money (either in the form of a loan or sometimes a joint stake in the stock) for the purpose of advancing trade. This was on the understanding that “the borrower should, in consideration of a high rate of interest, be freed from liability in the event of certain accidents happening, e.g. failure of goods to arrive at their intended destination” 2. This looks to me rather like a Babylonian version of today’s catastrophe bond. 1  Plantin and Rochet (2007). See also Thoyts (2010). 2  Clayton (1971). See also, Bernstein (1996). 2  BIS central bankers’ speeches  The practice of bottomry flourished due to the proximity of another group of great traders – the Phoenicians, who adapted the basic concept to support trade expansion on the Greek coastline during the 10th and 9th centuries B.C., and to the increasing domination in the Aegean Sea after 800 B.C. of Greek traders who needed indemnity against their cargo. Hop westward across the Mediterranean Sea to ancient Rome, and citizens were paying subscriptions to so-called “burial societies” to cover the cost of expenses associated with their death – a kind of latter-day funeral insurance. This activity evolved such that by the second century A.D. it became common practice instead to pay the relatives of the deceased person a lump sum (the funeraticium), provided their subscription was not in arrears and the deceased had not committed suicide 3.
Dimitar Bogov: Recent financial and economic developments in Macedonia Interview with Mr Dimitar Bogov, Governor of the National Bank of the Republic of Macedonia, in The American Times, October 2013. *  *  *  Please offer our readers a brief on the functions of the National Bank of the Republic of Macedonia (NBRM) Our primary goal is price stability with a secondary goal of financial sector stability. Without jeopardizing the primary goal NBRM should support economic policies. The way in which we execute the primary objective is by pegging the exchange rate with the Euro. Pegging our currency has been our long term strategy since 1995, originally with the Deutsche mark. When one compares our inflation with that of the European Monetary Union the result is relative alignment; to put it in real terms, EMU inflation is at about 1.9% with Macedonia hovering at 2.2%. We have witnessed in the past 4–5 years several very important foreign direct investments. Some of them are so large that they already equate to roughly 17% of our exports. How has the global recession and currently, the strength of the Euro, especially when compared to the US dollar effected your ability to maintain price stability, if at all? It affected our economy because our largest export markets are EU countries, equating to 60%, whose demand for our products dramatically reduced.

Exchanges with colleagues from market operations, payment systems and economic analysis will help the supervisors to develop a different viewpoint on current market developments, the importance of a specific institution for payments and the economic environment. One area in which cooperation will be particularly intensive is macro-prudential supervision. Our aim here is to bring together insights from both the macro-prudential and the micro-prudential areas, and to address undesirable developments in a targeted way. Conclusion Ladies and gentlemen, the European supervisory landscape is facing a major change. With the SSM, we have created a strong, new supervisor at the European level. The SSM will be able, and have the responsibility, not to do everything differently, but to do some things better. With the conclusion of the comprehensive assessment, and the publication of the results in the second half of October, and the start of our supervisory activity on 4 November, we have a few stressful months ahead of us. But we must also remember to occasionally pause for a moment and to reflect beyond the immediate tasks at hand. The SSM may have been created as a consequence of, and as a solution to, certain problems in Europe. But it is  BIS central bankers’ speeches  3  destined to be able to achieve much more and – at least that is my hope – to have an effect over and beyond Europe. Thank you for your attention. I am now at your disposal for questions. 4  BIS central bankers’ speeches
Datuk Zamani Abdul Ghani: Role of development financial institutions in the financial system Speech by Datuk Zamani Abdul Ghani, Deputy Governor of the Central Bank of Malaysia, at the International CEO Forum of the Development Finance Institutions 2005, Kuala Lumpur, 12 September 2005. *  *  *  I would like first of all to express my sincere appreciation to the Association of Development Finance Institutions of Malaysia for inviting me to say a few words this morning on "The Role of Development Financial Institutions (or DFIs) in the Financial System". It is indeed an honour to address such a distinguished gathering of CEOs and senior officials of DFIs from many parts of the world. Before going further into the subject at hand, allow me to congratulate the organisers for jointly putting up this international forum. This forum provides a platform for CEOs and senior officials to exchange views and ideas on SME development and just as important, the roles of DFIs in this endeavour. I would also like to specifically welcome the foreign participants to Malaysia and wish that you will have a pleasant and enjoyable stay in Kuala Lumpur. My remarks this morning will consist of three parts. The first provides an overall perspective on the universal establishment of DFIs in many parts of the world; the second will look at the prospects and some of the challenges for DFIs in carrying out their roles; and the final part will provide an insight into the roles of DFIs from the Malaysian perspective.

The basic banking account has no minimum balance requirement and offers free ATMs and debit cards to those who qualify. The scheme is expected to roll out by October this year. The Bank of Thailand is also undergoing regulatory reform to review outdated rules and regulations, to facilitate ease of doing business and ensure that our regulations do not impede competition and innovation and contribute to high costs of financial services. We started with foreign exchange regulations last year and are now reviewing banking regulations to improve digital banking environment and SME financing. In addition, the current backdrop of high household debt in Thailand and the need to improve individual’s financial safety net necessitate an overall improvement in financial literacy as well as financial planning skill. We have also tightened our market conduct regulations to ensure that misselling is minimized and financial institutions provide fair and transparent products and services. Given the growing importance of digital technology for financial services, we must also make sure that those with lower skills can reap the benefits that technology brings, to avoid digital divide. Last but not least, creating a financial ecosystem that values sustainability is critical to ensure that the Thai financial system of the future can continue to develop in such a way that would benefit all segments of the society and create minimal negative externalities. Later this month, the Bank of Thailand will host the first Bangkok Sustainable Banking Forum.
Interestingly, there is a small amount of trading in the repo market that takes place slightly below the ON RRP offered rate; this largely reflects lending by firms that are not New York Fed counterparties and therefore cannot participate in our operations. Second, within each market, I see periodic, transitory jumps in dispersion. In the unsecured market, these typically occur on month- and quarter-end dates.28 We don’t typically observe this pattern in the customer-to-dealer repo market, but did see a spike in dispersion on June 24, 2016, the day after voters in the United Kingdom chose to leave the European Union.29 This spike might reflect the pricing-in, for a brief moment, of a modest increase in counterparty-level risk related to this development. 7 / 13  BIS central bankers' speeches  These shifts in unsecured market activity around period-end dates are consistent with the incentive provided by the leverage ratio requirement. The frequency of the leverage exposure calculation differs by jurisdiction: the U.S. and UK require a daily or weekly average calculation for on-balance-sheet exposures for their supervised banks, while some other jurisdictions only require a quarter-end calculation or average of the three month ends within the quarter. As discussed earlier, the leverage ratio requirements in the U.S. apply to insured depository institutions, BHCs and IHCs operations of foreign banking organizations.

As we all know from first hand experience, the world economy is being transformed by the lowering of all sorts of barriers to the free movement of people, money, knowledge, goods and services. These trends are, of course, as old as human history. But there have been periods, like the second half of the nineteenth century, when globalisation has proceeded rapidly and periods, like the first half of the twentieth century, when it has gone into retreat. The past fifteen years or so have been a period of major advance as a result of far-reaching political and regulatory changes as well as revolutions in technology and communications. The pace of change has been striking in several key areas. First, international capital flows have grown explosively, as financial markets have become more integrated. As a result, the value of the global stock of assets in cross-border ownership tripled over the ten years to 2004. As well as increasing the scope for mobilising savings and allocating capital across different markets, the development of deep and liquid international financial markets has opened up new possibilities for diversifying risks and smoothing the adjustment to unforeseen events. This should promote both economic stability as well as growth. BIS Review 116/2006  1  Second, the sheer scale and pace of economic development in China is without precedent. What is not new is its strong export orientation – this was the route taken by Japan and the East Asian Tiger economies.
An active local bond market also supports financial system stability. Holders of bonds – in particular commercial banks – can make use of these bonds in securing emergency funding from the monetary authorities. An active bond market where securities are marked-to-market on a daily basis will facilitate commercial banks’ access to emergency liquidity assistance through their sale or the use of such instruments as collateral. This mechanism provides a more efficient and transparent process than the use of other types of collaterals such as land, title deeds, or receivables, which have less transparent market value and less liquidity. BIS Review 24/2003  1  Development of the bond market in Thailand The local bond market in Thailand, like many other Asian markets, has been hindered by a number of institutional problems. The small size of the markets – and the resultant low liquidity – provided little incentive for active participation by both issuers and investors. On the supply side, a small market limits the feasible range of marketable instruments and their effective tradability. On the demand side, a small number of market players and a narrow investor base provided insufficient demand for private players to act as market-makers. A small number of market players and the dominance of a few players hindered competition and market liquidity. Thai authorities have made significant strides in developing the government bond market since 1998. A pre-announced and regular issuance calendar for the year is now available to help investors plan their investment horizon.

Work on the supply sides revolves around issues of tax, legal and regulatory as well as accounting and should receive endorsement from the highest levels of government following the adoption of the Chiang Mai Declaration on the Asian Bond Market Development. Demand side development: establishment of the Asian Bond Fund On the demand side, central banks in the region have been working closely under the Executives Meeting of East Asia-Pacific Central Banks – or EMEAP – to establish an Asian Bond Fund. Under this initiative, central banks will set aside a fraction of their reserves into a pool that will be invested in bonds issued by Asian governments and government enterprises, with an ultimate aim to provide a catalyst for private investors to consider investment in Asian issues EMEAP has worked out the details and modalities of the operation of such a Fund and will announce details to the public shortly. Approaches to regional cooperation: work on developing the supply side ASEAN+3 and APEC are both working on the development side of bond markets, including the removal of barriers impeding the issuance of bonds both in the regional and domestic contexts respectively. In addition, there has been cooperation in setting up the necessary infrastructure for such a regional bond market, including a regional credit rating agency, as well as credit enhancement facilities.
The U.S. disinflation experience in the early 1980s was the prime example of this. Known memorably as the Volcker disinflation, the Federal Reserve took about four years to bring down inflation, but at a cost of the 1981-2 recession which was the most severe in the post-World War II period. Of course, one could argue that monetary policy is ineffective against supply shocks and therefore raising the interest rate would only further hurt the economy. It is true that monetary policy is a demand management tool. It is true that the best remedy to tackle any supply shock should be one from the supply-side policy that mitigates its impact on production costs and the economy’s potential output. However, most supply-side policies take time. For example, it takes many years to improve the logistic system, education and skill attainment of the labor force, and institutional quality. 2  BIS Review 98/2008  On the other hand, alleviation measures such as promoting the use of alternative energy has had a limited impact on inflation. In the short run therefore, what is left as a clear option is to adjust the demand accordingly to ensure stability in the immediate future as well as the medium term. After all, it is also true that inflation is a monetary phenomenon and should be corrected by monetary policy. To make my point clearer, let me compare the current situation with the cake eating analogy. Suppose that you gain happiness from eating cakes. I guess we all do.

This is why modern central banks pay so much attention to ensure that inflation expectations do not run away. In general, how well a central bank can anchor the public’s inflation expectations will depend on the extent in which the public perceived the central bank’s seriousness in fighting inflation. Such credibility hinges critically on the central banks’ actions and what the public expect it to do. Words like “behind the curve” are often used to describe central banks that move too slowly to curb public’s inflation expectations. Central bank, unlike the government which has a fixed term, has a greater incentive to care for economic stability. While the government tends to be more myopic in their policies, central bank is mandated to optimize the benefits across horizon. History has taught us that  BIS Review 98/2008  3  a popular central bank is not always the most credible central bank. A pro-growth central bank is prone to inflationary bias which undermines its credibility in fighting inflation. Disinflation would then become more costly. Inflation targeting is one framework to discipline the central bank by paying attention to price stability. It has been working very well for us and for many other countries in the world that have adopted the regime. But the challenge today is to find the right sacrifice ratio between economic growth and inflation. In addition, the central bank must ensure that inflation expectation is under control and the adherence of inflation targeting framework can go a long way to ensure this.
In the “Uster Memorial” document, an interest rate of 4% was considered to be appropriate; 1 well, as you know, Swiss interest rates have been considerably below this level for the past few years – so, in this respect, the SNB has fulfilled the requirements set out in Uster in 1830. A short journey through monetary history I would now like to take you on a short trip through Swiss monetary history. We will start our journey in the year 1830, and will make stop-offs at sixty-year intervals, i.e. in 1890 and 1950, before returning to the present day. Let us assume you wanted to buy a loaf of bread in the year of the Ustertag. What money would you have used to pay for it here in Uster? My question may appear simple, but the answer is anything but easy. That is because the year 1830 falls within the long multiple coinage – or multiple currency – period. In other  1  Carl Dändliker: Der Ustertag und die politische Bewegung der Dreissiger Jahre im Canton Zürich (nebst Abdruck des “Uster-Memorials” als Beilage). Zur 50-jährigen Erinnerung, Zurich 1881, p. 6 of enclosure. BIS central bankers’ speeches  1  words, the currencies being used in the canton of Zurich in 1830 included guilders, batzen, shillings, thalers, hellers and angsters, just to name a few. 2 Over 300 different kinds of coins were in circulation in Switzerland, with thousands of different embossed images.

Nevertheless, we should also be aware that the monetary order is the result of a historic development. Since we are not starting from scratch, even well-meaning suggestions for improvement – ones that might in theory appear totally justified – may have grave unintended consequences in the real world. I will use four radical reform proposals to illustrate what I actually mean by this. The proposals in question are, first, private money instead of state money, second, a return to the gold standard, third, the introduction of plain money and, fourth, the adoption of foreign money. Private money instead of state money What would it be like if we could pay with varying currencies offered by private providers, instead of with state currencies? At first glance this idea seems quite appealing. After all, competition between different providers of goods and services is a major principle underlying our economic order. We owe much of our progress and, with it, our prosperity to this factor. Why should we make an exception when it comes to the currency, or to money? When talking about monetary competition, I would like to begin by putting our banknote monopoly into perspective. Since freedom of contract prevails in our country, you are at liberty to agree a currency other than the Swiss franc with your business partner. You may purchase your loaf of bread using euros, US dollars, gold, WIR money or even one of the new virtual currencies such as bitcoins, 8 if the baker is willing to accept them.