samchain/econo-pairs-v1 huggingface dataset:
A careful assessment needs to be made of the potential medium and longterm effects of the proposed reforms on market structures and behaviour. These considerations are equally relevant in the context of Islamic finance. The assessment on the aims and relevance of each of the proposed reform measures needs to take into account the two important considerations in Islamic finance; the need to support sustainable and responsible innovation, and secondly, to leverage on its inbuilt strengths that set Islamic finance apart in performing its role in supporting the efficient mobilisation and allocation of resources to generate real economic activities. Given the damaging effects of complexity and opacity associated with the recent unfettered innovative activities in the conventional financial markets, it has resulted in a reassessment of the role and benefits of financial innovation. In Islamic finance, innovation is key in pushing the frontier of market development to generate the range of products and services, processes and functions. The key lies in preserving the benefits of innovative initiatives and activities whilst ensuring that they do not result in negative externalities. In considering the relevance of the global regulatory reform to Islamic finance, there is therefore a need to consider the underlying elements that guide the process towards sustainable and more socially-responsible financial innovation. This comes in the forms of its strong paradigm in governance, disclosure and transparency, as well as its emphasis that innovations are anchored in the objectives of Shariah and thus are for the benefit of the people.

In this work, all of the public authorities use the National Institute of Economic Research’s forecasts for economic developments. 8  BIS central bankers’ speeches  The Riksbank’s profits and dividends 1988–2018 SEK billion  Sources: The National Institute of Economic Research and the Riksbank  This development is not unique to the Riksbank. Many of those who have invested in bonds will face losses when interest rates rise. Those that are hit the hardest will be the central banks that have applied what is known as quantitative easing in recent years, that is, they have bought large volumes of bonds with long maturities to stimulate the economy. The fact that the Riksbank makes losses in turn means that the bank will not be able to pay dividends to the government for some years. As the dividend payment is based on the results from the past five years, it will decline with a time lag, and the forecast at the moment is that we will pay two further dividends before the losses take over and the dividend payments become zero. This is of course a setback for the government’s income. And as the dividends cannot be negative when the Riksbank makes a loss, the bank must bear the losses, which will reduce our equity. As we have equity of a good SEK 100 billion, we can manage this without any infringement of our financial independence. The Riksbank is financially strong I have now described how the Riksbank’s balance sheet has changed over the past ten years.
In Japan, industrial production fell by 8.5% in just one month in November, and in Germany, the value of exports declined by over 10%. In the United States, over a million jobs were lost in the final two months of last year – the fastest rate of job losses in over 60 years. And in the United Kingdom, manufacturing output contracted at its fastest rate since 1980. Trade was badly affected – the Baltic Dry Index, an indicator of demand to ship materials around the world – fell at the fastest pace on record in October. For the world economy as a whole, consensus forecasts of growth in 2009 have been revised down from 3% to just 1% since September.1  1  See charts below. Sources: Chart 1: Composite indices from Global Financial Database, comprising of: East Indies share for 1693; Bank of England and East Indies shares from 1694 to August 1711; Bank of England, East Indies and South Sea shares from September 1711 to January 1811; Rostow's Total Index of Share Prices from 1811 to 1867; the London and Cambridge Economic Service Index from 1867 to 1906; The Banker's Magazine Index from 1907 to May 1933; the Actuaries General Index from June 1933 to April 1962; and the FTSE All-Share from April 1962 onwards. Data are monthly until 1965, then weekly until 1968, and daily afterwards.

No risk assessment is ever really complete and it is essential for all of us to keep up with what is going on to ensure that we are employing our resources as effectively and efficiently as possible, while achieving the dual objectives of risk-based AML/CFT efforts as well as ensuring legitimate customers have access to services. 23. So those are the three issues that I would like to highlight and which would be explored in the various sessions of this Conference. All in all, I would emphasise that the global AML landscape is an evolving one - geopolitical developments will continue to affect sanctions risks, criminals will come up with new ways of stealing money and of hiding and moving those money. Technology can hinder or help us in our AML efforts, and I have to say that although we are already doing a lot, we are far from having the perfect solution. The challenge that we face collectively, in the region, is to develop responses to existing and new risks that: Are agile and adaptable, while providing a framework of principles and rules that that we can all agree to and follow; Recognise innovation and make the best use of technology; and perhaps more importantly Challenge our established ways of meeting some expectations, and ensure the response always relates to effectiveness. 24. I note that you have a very full agenda the coming days covering these and other topics.
Under this framework and, as I have said earlier, in a setting in which inflationary risks have tended to increase over the last few months, in March we discontinued net purchases under our pandemic emergency purchase programme (PEPP) and we agreed to gradually reduce net purchases under our asset purchase programme (APP). In June we decided that as the three conditions established by our forward guidance for raising interest rates had been met,5 net purchases under the APP would end on 1 July, and we informed of our intention to raise policy rates in July and again at our September meeting.6 In July, we decided to raise all three ECB policy rates by 50 basis points (bp), taking the deposit facility rate to 0%, thus moving out of negative territory for the first time since 2014. This was a larger increase than signalled at the previous meeting, for two reasons. First, the updated assessment of the risks to inflation, which included the materialisation of certain upside risks in the short term relative to the June projections. Second, we took into account the reinforced support for the effective transmission of monetary policy provided by the new Transmission Protection Instrument (TPI), which was approved at that same meeting. Subject to fulfilling established criteria, the TPI will enable the Eurosystem to make secondary market purchases of securities issued in jurisdictions experiencing a deterioration in financing conditions not warranted by country-specific fundamentals, to counter risks to the monetary policy transmission mechanism to the extent necessary.

In such cases, maintaining the medium-term orientation in the definition and attainment of the target would be all the more advisable. How is expected inflation over the medium term measured? First, it is important to clarify that predicting inflation over a two or three-year horizon is a very challenging task. Especially in a setting as uncertain as the current one. Therefore, like other central banks, we at the ECB use various indicators of future inflation, such as surveys of professional forecasters and financial market prices, which I will come back to later. Key data in this regard are the ECB staff projections, which in turn draw on a wealth of economic and monetary analysis. As I have said, the latest projections published in September put average inflation in 2024 (the end of our medium-term horizon) at 2.3%, clearly above our target. These projections were based, among other considerations, on a future path of euro area interest rates – implicit in the financial market data available when the projections were prepared (specifically, as at 22 August 2022) – that began with a hike of 50 bp at our September meeting, followed by subsequent further increases.8 Accepting that, in line with our mandate, interest rates will have to rise to a level that allows us to ensure a gradual convergence of inflation to our medium-term target, returning inflation  8  Specifically, the projections were based on short-term interest rates of 0.2% in 2022, 2.0% in 2023 and 2.1% in 2024.
Politically, it may be difficult, if not impossible, to carry out changes to the taxation system making mortgage borrowing significantly more expensive, even if this would be the most effective way of reducing the risks associated with high indebtedness among households. This means we need tools that can counteract this kind of indebtedness and which can be used with the aim of promoting the stability of the financial system. There is a great need for such tools in Sweden The Swedish banking system is large and closely interwoven, which means that problems in one bank can easily spread to the other banks. The costs to society can thus be extensive in the event of a crisis. Increasing the safety margins in the financial system is therefore highly important. It can be enough for one bank to be impacted by problems for confidence in all banks to be dealt a blow. The important role of confidence in the financial markets became clear in the autumn of 2008, when the lack of confidence led to many banks rapidly encountering liquidity problems and being forced to rely on the Riksbank’s measures for their funding. In this regard, the Swedish banks are also particularly sensitive to shocks on the financial markets as they largely obtain funding in foreign currency. Funding in foreign currency is often for shorter durations than funding in Swedish currency and has been seen to disappear abruptly in times of stress.

Central government finances can be weakened so much that the country enters a debt crisis. From this point of view, it may be considered justifiable to make every effort to increase the resilience of the financial system. At the same time, it is important to always compare the cost of various types of measure with their benefit, so that we can design the most efficient system possible. I have presented a long list of possible instruments that could be used to conduct macroprudential supervision. By necessity, this list will include most tools, as different tools are needed to counteract different systemic risks. But we are discussing something that is relatively new. At present, we only have limited experience of conducting macroprudential supervision in practice. This means that the process of introducing macroprudential supervision will entail a certain degree of trial and error. Quite simply, we will have to test our way forward, while constantly doing our best to assess the efficiency of the instruments being employed. 13 The financial system is complex and dynamic, and the risk outlook is changing all the time. This means that it can never be determined with certainty where a financial crisis may arise. Bearing this in mind, it is important that we, in Sweden, construct a framework for macroprudential supervision that is flexible and that we do not limit our possibilities in terms of the instruments that can be used. It is also important to establish a process to evaluate and later develop and modify the toolbox.
As a result, the crack of the  10  Hardgrave et al (2006). 11  Cohen (2002). 12  Akerlof (1970). 13  eBay (2012). 14  Grean and Shaw (2002). 15  Lee et al (1997). BIS central bankers’ speeches  5  bull-whip has been nullified along the product supply chain, reducing system-wide instabilities. For Wal-Mart, common standards have revolutionised ex-ante risk management, allowing real-time aggregation and visibility of risks and opportunities along the supply chain.16 For other industries, a common language has also transformed ex-post risk containment. Take the pharmaceuticals industry. Building on existing GS1 standards, individual packets of drugs can now be assigned a unique serial number by the manufacturer, along with information on the batch from which it was produced and other relevant attributes. These data can be shared in a common pool with retailers and distributors. As at Wal-Mart, the packet’s location is logged at every stage of the supply chain from factory to pharmacy. This central supply chain information system has transformed drug risk management in a crisis. In the past, before drug packets had unique identifiers, defective products would have resulted in a mass recall of all packets of a certain drug type. This often caused massive disruption to the manufacturer and generated panic, bordering on hysteria, among consumers. The bullwhip effect was powerful and destabilising. Today, those instabilities have been calmed courtesy of common standards and improved technology.

Digital publishing and distribution has fundamentally changed this market. Both the books and the shelves are now electronic. Authors can now format books for e-readers in a couple of hours. Sales platforms like Amazon Kindle Direct give access to a worldwide audience with essentially no upfront costs. Supply can close to perfectly match demand as the marginal cost of creating and delivering an eBook is effectively zero. This digital revolution has caused barriers to entry to plummet while simultaneously raising returns to author entry: they now receive as much as 85% of the royalties from an eBook, compared to as little as 10% from a physical book. Previously unpublished authors now sell millions of books. The incumbent middle men – book publishers, distributors and retailers – have found their lunch devoured in one sitting. In effect, they have been disintermediated by technology and (in a delicious irony) a common language. This pattern has been replicated in the music industry. For half a century or more, the music supply chain was unchanged. New acts were discovered by large record labels who distributed physical goods (vinyl, tapes or CDs) to retailers for sale to the public. Over the past decade, the costs of copying and distributing music have fallen to close to zero. As in publishing, barriers to new artist entry have plummeted. The middle-men – music production companies and distributors – have seen their piece of the pie eaten. And as a direct result of this industrial transformation, the pie itself appears to have grown.
Before I address the benefits of EMU and the stability-oriented policies that have to be implemented to ensure that these benefits are achieved, let me briefly mention the main institutional bodies involved in the formulation and implementation of the single monetary policy. Monetary policy is determined by the Governing Council of the European Central Bank (ECB), which consists of the eleven governors of the national central banks (NCBs) of the participating Member States and the six members of the Executive Board of the ECB. The implementation of the single monetary policy is the responsibility of the Eurosystem, which is comprised of the ECB and the eleven NCBs of the participating Member States. The Executive Board of the ECB is a separate decision-making body. Its role is to ensure that the tasks conferred upon the European System of Central Banks (ESCB) are implemented, either through its own activities or through the NCBs. Economic growth - the benefits of EMU I should now like to address the benefits of EMU and why I believe that the introduction of the euro and the single monetary policy can result in higher economic growth in the euro area and thereby contribute positively to the development of the world economy. Of course, the degree to which these benefits are achieved depends not only on the monetary policy of the Eurosystem but even more so on accompanying stability-oriented fiscal policies and appropriate labour market policies.

It will be clear that this is not an easy process and monetary policy alone cannot achieve this. The full benefits of the single currency will come only if there is appropriate support from other stability-oriented policies, especially fiscal and labour market policies, and if structural reforms are carried out in these areas. Thus, price stability is a necessary, but not a sufficient condition for grasping all the opportunities of EMU. In this regard, it is of the utmost importance that the governments of the EU Member States continue to implement sound and stability-oriented fiscal policies, by which I mean policies aiming at the medium-term objective of a budgetary position close to balance or in surplus. As you will know, this condition is stipulated by the Stability and Growth Pact, which ensures the lasting compliance of fiscal policies with the requirement of budgetary prudence. From the perspective of a central banker, a prime reason for the establishment of the Pact was that a lack of fiscal discipline would negatively affect the ability of the Eurosystem to achieve its primary objective to maintain price stability. In this sense, the Stability and Growth Pact is one of the most important safeguards that will ensure that price and fiscal stability remains the cornerstone of EMU.
This was evident from Sweden’s history of uncertainty about government finances and high inflation were Sweden to choose the outsider alternative on the grounds of the insurance argument, this could be perceived as a signal that Sweden’s economic policy would again become accommodating. This risk was also mentioned in the report. The Riksbank fully agreed, on the other hand, that unemployment is a serious problem in the Swedish economy. But we did not consider that this problem could be resolved by remaining outside the monetary union. As the report had indeed pointed out, other measures were needed to improve the workings of the labour market and wage formation. The Riksbank underscored that the necessary structural measures for the labour market would be easier to implement if we had established the credibility of an economic policy for sustainable growth. Does the stronger economy warrant different conclusions? In the light of all that has happened in the past two or three years, the assessments presented in the report and by the Riksbank should perhaps be modulated. The case for an insurance policy and freedom of action was argued at a time when public finances were weak and unemployment was still at a record level. The measures of economic policy had admittedly begun to build up public confidence in a more stable future after the profound crisis in the early 1990s but the outlook was still uncertain. Today the situation is better, with a central government budget surplus and high ambitions for fiscal policy.

If Sweden chooses to remain outside, it will ultimately be difficult to get the participating countries to understand our actions. The fact that the monetary union is a major component of a larger process of integration means that we cannot expect to get simple answers to our questions by adopting an attitude of wait-and-see. Assessing the project over a complete business cycle certainly has its advantages but the prevailing uncertainty is costly. Investments are postponed or shelved. Twin systems have to be maintained. I am convinced, moreover, that new questions will arise all the time. We shall never be able to tell just how EMU will develop. This is something that those who participate decide as they go along. In the event of turbulence in the world around us, participants in the euro area have extra protection. This was evident last autumn, when the financial market turbulence hit the Swedish krona more heavily than the Finnish markka. On the other hand, as euro participants we would be in the same boat as at least eleven other countries. That naturally implies greater dependence – we would be clearly involved in problems that arise in the euro area. The only way to counter that would be by actively influencing developments in the euro area in the right direction. An insurance argument can be put for remaining outside the euro area. If we continue to manage the economy properly, there should be freedom of action in our economic policy. But this is not a simple matter.
The data available on the Spanish economy suggest that, during the first quarter of 2015, the expansionary trajectory observed in 2014 has stepped up. GDP is estimated to have increased by 0.8% in quarter-on-quarter terms, which would place the year-on-year rate of change for the first quarter at 2.5%, a higher level than expected. The recovery in the Spanish economy this year and in 2016 will be underpinned by the strength of private domestic demand and by stronger exports. Moreover, the decline in the tax burden, following the reform that came into force in January, and the monetary policy measures recently adopted by the ECB – including most notably the asset purchase programmes – will also support growth. The projections published by the Banco de España  BIS central bankers’ speeches  1  in its Economic Bulletin two weeks ago point to GDP growth of 2.8% this year, followed by similar growth in 2016, at a rate of 2.7%. As to the labour market, the projections of the Banco de España are for growth in employment of 2.7% this year and 2.6% in 2016. The increase in employment will enable the unemployment rate to continue shrinking at an even greater pace than in 2014, to stand at around 20% of the labour force in the fourth quarter of 2016.

These strains in household finances from suddenly excessive debt service burdens are met by households in a variety of ways: through default, foreclosures, and bankruptcy, or renegotiation of the terms of repayment, but also through continued higher principal and interest payments accompanied by much lower consumption than the household had previously planned. As we see in Chart 1 (Employment declined dramatically) job losses in the recent recession were extremely large and prolonged, a problem that resulted, in part, in significant delinquencies in debt repayment. Furthermore, the significant decline in house values imposed a much stricter limit on how much households could borrow if they needed, for example, to adjust to the effects of a temporary loss of income. Recent economic research has examined how the macroeconomy is affected when households suddenly experience reduced borrowing capacity. Eggertsson and Krugman consider the case of households that have borrowed up to some limit and now see their debt limit reduced; these households suddenly find themselves over-indebted and are forced to cut spending.1 If the required cuts in spending are large enough, then even a very active monetary policy will be unable to offset them completely. Other research has also suggested similar mechanisms.