samchain/econo-pairs-v1 huggingface dataset:
There have been over 9 million reported cases of Covid globally and over half a million reported deaths, around 0.01% of the global population.1 As a point of comparison, the Spanish flu of 1918 recorded 33 million deaths or close to 2% of the global population back then.2  During the first few months of the year, and unlike in 1918, most countries put in place social distancing measures to contain the spread of the virus, albeit at different times and with differing degrees of stringency (Chart 1). Predictably – indeed, intentionally – these measures severely curtailed movement of goods, services and peoples, constricting economic activity across a very wide range of sectors and countries. 1  Data from European Centre for Disease Prevention and Control. Estimates of the death toll are uncertain. The number quoted here averages the mid-range of estimates in Patterson and Pyle (1991), Johnson and Mueller (2002) and Spreeuwenberg et al (2018).

The economy will also, though, be shaped by the behavioural responses of households and businesses, and the policy responses of Governments and central banks, to these shocks. Understanding those responses is the purpose of my comments today. I will partition my assessment of the economic impact of the Covid crisis into four phases, or “quarters”, covering the past, present and near and distant future. The first “quarter” covers the initial impact of the virus; the second, the immediate recovery following these shocks; the third, the second-round effects on spending and employment; and the fourth, the longer-run impact on households and businesses. Both the UK and the global economies are already well into the “second quarter” – the recovery phase. The UK’s recovery is more than two months old, while the global economy is perhaps three months into its recovery, in both cases from an exceptionally low starting point. Let me say a little about each of the phases, before concluding on the role of policy in supporting the economy during the Covid crisis. “The First Quarter”  The Covid-19 crisis has dramatically affected public health in every country in the world.
The stability of the financial system was thus definitely never threatened. But it is regrettable that we still have not managed to create  BIS Review 30/2008  7  an adequate regulatory framework in this field, more than fifteen years after our own bank crisis. In countries where they have slightly more experience of bank failures, such as the United States and Canada, they have learn that special institutions and arrangements are required to manage institutions that are experiencing financial problems. One of the most important lessons is that the authorities must be able to intervene as quickly as possible when a bank faces problems. There are several reasons for this. The first is to put pressure on the management and owners of the bank to rectify the situation and hopefully to prevent the situation deteriorating further. The so-called Savings and Loans crisis in the United States in the 1980s become more costly when the authorities failed to take action in time. This meant that in the United States at the beginning of the 1990s they introduced a system with so-called prompt corrective action. This means that the authorities quite simply are obliged by law to intervene at certain specified thresholds. In my opinion it is desirable that Finansinspektionen (the Swedish Financial Supervisory Authority) should also have a large toolbox of measures that can be taken at an early stage. It should be possible to intensify these measures gradually as problems worsen.

Determining what might have happened if the authorities had acted otherwise is no easy task. Allow me to present a hypothetical example: The central bank thinks financial imbalances are building up, and the Executive Board sets the key rate higher than it otherwise would have done. While a financial crisis does not actually materialise, unemployment rises and economic growth slows. Inflation could fall below target. In this situation, it may be difficult to assess whether the Board made a good decision to raise the key rate. Such assessments of motives and outcomes are also the subject of moral philosophy and its discussion of what constitutes a good decision. In setting the key rate, both intentionalist and deontological ethics will provide us with the same guidance as to what good decisions are. In both cases, the decision must be based on achieving the objective of monetary policy, and  35  A fundamental principle of criminal law is that a person can only be judged if that person can be charged with a criminal offence and is proven guilty. There are two forms of guilt: One is guilty with intent, which typically means that the offender intended to produce the negative outcome. The other form of guilt is negligence, which somewhat simplified implies a failure to use reasonable care or prudence. In determining whether an offender has acted with negligence, his behaviour must be measured against ordinary reasonable and prudent behaviour in a comparable situation. A Supreme Court ruling from 1984 provides an illustration of negligence consideration.
Good links between these institutions and the academic world are also desirable; in a European context I consider that in this respect we are already in the forefront. It is likewise important that we participate in the international work on these issues, primarily in the context of the European Union and the ECB but also in the OECD and the IMF. And although we are doing relatively well internationally, a good deal is being accomplished elsewhere that we can try out here in Sweden. As a member of the Governing Council of the ECB, the Riksbank will have cause to go on working on these issues at the European level. I also think it would be natural to continue to publish the Inflation Report twice a year; that would be a way of presenting analyses of the interplay between cyclical activity, monetary policy and the government finances and thereby contribute to the discussion of economic policy. A qualified ongoing analysis is needed for a small country like Sweden to play a meaningful role in the international cooperation. Besides the traditional issues of stabilisation policy, there are grounds for the Riksbank continuing to be deeply engaged with developments in the financial sector, for instance with the Stability Report. A conceivable evolution of the existing structure as regards the basis for fiscal policy could be a more direct involvement of the Economic Council that is attached to development work in the Ministry of Finance.

This is not a reference to a 70s rock band – we do have some rockers in the PRA but they seem mainly to be Status Quo fans. It’s also not a homage to the song by Prince or the London radio station. Still less is it a breach by the PRA of social distancing guidelines. Rather, Lord Mayor, instead of “keep it simple, stupid”, in the PRA we say: keep it strong and simple! 9 See for example: https://www.osfi-bsif.gc.ca/Eng/fi-if/in-ai/Pages/SMSB20_cp.aspx#fnb19 10 Community banks meeting a 9% leverage ratio criterion can opt into a different regime. 11 See for example: https://www.federalreserve.gov/aboutthefed/boardmeetings/files/tailoring-rule-visual-20191010.pdf 8  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  8  Figure 1A: Predicting distress by setting regulatory thresholds To help us understand the need for a tailored approach for smaller banks and building societies, we’ve been testing how well some of the metrics in our current regime would have performed if we’d used them to identify vulnerable banks in 2007. We’ve done this by applying to historical data about banks’ leverage ratios, risk-weighted capital ratios, and net stable funding ratios, a technique used in existing Bank research.12 What we’re looking for is combinations of these balance sheet ratios which help us separate banks which got into trouble during the succeeding crisis from those which didn’t. Good combinations produce high hit rates and low false alarm rates. Our findings suggest that these metrics are not as well-suited to identifying small banks that are headed for trouble. Source: Bank of England and Bank calculations.
That increasing short-termism in turn led to the increasing amplitude of the business cycle, so that inflation rose progressively higher from economic peak to peak and unemployment rose progressively higher from economic trough to trough. I am convinced that, with others, we really have taken on board the lessons of that experience. The requirements that public debt to GDP is kept at a stable and prudent level, with borrowing over the economic cycle limited to finance investment spending, constrain the use of fiscal policy as a short-term instrument. And monetary policy has been given the distinct role as the primary instrument for short-term aggregate demand management, with a target for retail price inflation, not simply as an end in itself, as some people still seem to imagine, but as a measure of the extent to which the growth of demand is held consistently broadly in line with the underlying - sustainable - growth of supply-side capacity. The past ten years have in fact been a period of unusual stability in that broader sense for the UK economy as a whole. Inflation has been consistently low throughout that time - close to, and recently modestly below, our present 2½% target. But that has not been achieved at the expense of consistently high interest rates, and weak growth and high unemployment, as many people initially feared that it would.

In a situation where business confidence - and therefore investment - was weak, that essentially meant stimulating consumer demand. It was not without risk - in terms of the build-up of household debt and of a possible house price bubble - but without it we, too, would have faced recession. Looking forward, there is a reasonable prospect that global demand will pick up gradually, and we may see a more sustainable pattern of exchange rates beginning to emerge with the albeit hesitant strengthening of the euro. There are in fact already signs that manufacturing output has started to recover. But there are downside risks to that prospect associated with the renewed volatility of international financial markets over the summer, which we are monitoring very closely. But abstracting from these recent global and largely cyclical, effects, the more fundamentally important point, looking further ahead, is the likelihood that we - alongside other countries - will continue to operate within a framework of overall macro-economic stability - as a necessary condition for the effective functioning of the market economy. Those presumptions may well mean that manufacturing continues its gradual, long-term, relative decline - as a share of total output, and in terms of the number of people employed - in all developed industrial countries, including the UK.
The distribution reserve exists because the SNB does not pay out all of the distributable profit at once. 1 It corresponds to a profit or loss carried forward in the balance sheet and is part of the SNB’s equity capital. The distribution reserve helps to smooth the annual distributions to the Confederation and the cantons by serving as a buffer that balances out the fluctuations between years with profits and years with losses. 1  For more information on the distribution approach, cf. Jordan, Thomas J. (2021), SNB distributions – not a matter of course even when profits are high, Speech held at the 113th Ordinary General Meeting of Shareholders, Zurich, 30 April 2021. Page 3/5  The level of the distribution reserve in recent years has led some observers to overestimate the potential for SNB distributions and view the annual distribution of up to CHF 6 billion as too low. However, the good results of the past few years were achieved during an exceptional financial market environment shaped by globally declining interest rates, low inflation, high liquidity and rising share prices. But this environment has now changed sharply. In the first half of 2022, interest rates increased worldwide and stock markets declined, leading to considerable price losses on the SNB’s bonds and shares. The accumulated book profits from the past were reversed by a book loss. The SNB recorded a loss of around CHF 95 billion for the first half of 2022, which corresponds to almost the entire distribution reserve.

In the United States and in this country, for example, inflation has been BIS Review 22/1997  -3-  contained to around 3% with continuing growth and low or falling unemployment. And this pattern looks set to continue. In Japan and on the Continent of Europe, on the other hand, while inflation has been even lower, activity has been disappointingly weak, and unemployment on the Continent at least has risen to quite frightening levels. And while there is now the prospect of a moderate pick-up in activity in these countries, that is not yet assured. Japan, which is in many respects a unique case, faces substantial fiscal consolidation. And in Europe, too, the prospects are clouded by pressure to bring budget deficits down sufficiently to meet the Maastricht convergence criteria this year, notwithstanding the weakness of the domestic economies, and in an environment of longer term structural inflexibility. These divergent developments go a long way towards explaining recent differences in the behaviour of both bond markets and exchange rates. In both the United States and the United Kingdom the sustained expansion of domestic demand and of ouput has generated market expectations of an essentially cyclical rise in short-term interest rates. Sluggish economic activity elsewhere, on the other hand, means not only that short-term interest rates are significantly lower in Japan and the core European countries; but it also means that they are thought, by the market, to be less immediately likely to rise.
The assumption also made it difficult to assess our forecasts and to compare them with those of other forecasters. Moreover, it gradually became clear that this rule could sometimes be an obstacle to our communication. Too much focus was on the current interest rate decision and the inflation forecast exactly two years ahead. On the other hand, neither the general public nor the financial markets received any clear guidance as to how we viewed interest rate developments further ahead. As our credibility increased, we gradually gained greater scope to conduct more flexible monetary policy. This also led to a greater need to show that it is the entire expected sequence of events for inflation and the real economy a few years ahead that is important to monetary policy decisions, and not merely the  4  See, for instance, Blinder, A.S., (2006), ”Monetary Policy Today: Sixteen Questions and about Twelve Answers”, paper presented at the Banco de España Conference on “Central Banks in the 21st Century, Madrid, June 8-9, 2006 and Kontulainen, J., D., Mayes and J., Tarkka, (2004), “Monetary Policy Assumptions in Central Bank Forecasts”, Bank of Finland Bulletin 4, 2004. 5  However, the monetary policy decisions made by the central banks always apply to only the current level of the policy rate, that is, the level that will apply until the next decision is taken. There are some expectations.

Prasarn Trairatvorakul: Journey towards a more competitive, inclusive, connected and sustainable Thai banking system Speech by Dr Prasarn Trairatvorakul, Governor of the Bank of Thailand, at the Association of International Banks (AIB) Dinner Talk, Bangkok, 21 May 2015. *  *  *  Ladies and gentlemen, It is a great pleasure for me to be here on this special occasion. The topics I addressed in previous occasions focused on economic situations and developments. So much has been said and discussed on those issues, so today I would like to talk about the future development of the banking system in Thailand which is equally important. As many of you here are already aware, we are drafting the third Financial Sector Master Plan which will cover the next five years time span. The process is quite challenging because it involves many stakeholders, both in the public and private sectors, including foreign banks like yourselves. We thank you for your suggestions and feedback provided individually and also as a group through the AIB. Today I will share with you briefly the concept and aspiration behind the development plan for the banking system in Thailand. Thailand is currently at a crossroad in need of structural reforms to cross over the middle income trap. This requires commitment from all stakeholders. The public sector is already taking the lead on infrastructure development to promote urbanization and more equitable income distribution. For the private sector, they will need to make a transition toward production with innovation and higher value-added.
Michel Camdessus Central Banking Lecture – Washington, 14 September 2022 Ethics of currency: a possible guide for central bankers? Speech by François Villeroy de Galhau, Governor of the Banque de France  Press contact: Mark Deen (mark.deen@banque-france.fr), Déborah Guedj (deborah.guedj@banquefrance.fr)  Page 1 sur 10 Ladies and Gentlemen, It is my great pleasure to be in Washington with you today, and to deliver this speech in honour of Michel Camdessus. I would like to take this opportunity to pay a special tribute to him, and express my personal gratitude. Michel is not only one of my predecessors as a Governor of the Banque de France, but also a friend of mine and – yes – a master. My speech was prepared with his precious help, so today you can almost enjoy a “Camdessus Lecture by Michel Camdessus himself”. The theme we chose together, the “ethics of currency”, has guided him throughout his career. In the murky waters that we central bankers are navigating, it should more than ever serve as a golden thread. I will briefly discuss the reasons why I dare to talk about the ethics of currency (I), then elaborate on the golden triangle of trust today (II) and finally raise the question as to whether the international dimension of trust can still inspire us (III). I. Why I dare to talk about the ethics of currency Before going any further, we must find a common definition of “ethics”. Is it possible to take this word as a synonym for “morality”?

For centuries, this question has been the “bridge of donkeys” (pons asinorum) for philosophers’ apprentices. Supporters of the synonym theory highlight a common etymology between the two words – morality is the Latin translation of Greek ethos. Despite their initially identical meanings, the two words nevertheless have followed different paths over time: “morality” can be described as a “hard concept”, similar to the fundamental rules engraved on Moses’ stone tablets or in the code of Hammurabi. In contrast, “ethics” refer to a softer and less binding concept, a kind of existential version of morality with a more personal dimension. I will use the word ethics in that way in this speech. The question of interest rates is a noteworthy example of the way a moral prohibition can evolve into a more flexible and ethical approach. From a moral overall ban, ethically “fair” interest rates have been progressively distinguished from usury rate, with the latter still being forbidden. Page 2 sur 10 “Homo economicus” invented currency very early in human history, and it is striking that almost as soon as currency was born, countless abuses were seen as well: manipulation of gold or silver weight in coins, skewing of scales, and so forth. Men therefore quickly summoned ethics to define how to govern its use. However, human kind has also shown a tendency to exempt itself from the rules it had previously established, before setting new rules again in order to respond to the problems caused by deregulation.
CBSL recognizes that demand and supply forces should be allowed to determine the exchange rate and that some amount of speculative trading is needed to develop the market. When there are trade bills of customers or banks themselves and, if banks do not have adequate forex with them, it is natural to borrow from the market. However, more often than not, traders/dealers speculate to make short-term gains in the forex market and try to drive the exchange rate to levels which they prefer it to be. Banks should earn profits and be financially viable. CBSL wishes to see a well-capitalized and profitable banking sector. In many instances, it was noted that the exchange rate depreciates to levels which are not in line with inflation differentials of our trading partners measured through the real effective exchange rate. This could be due to market domination by a few dealers who wish to earn unusually high profits. Needless to say that exchange rate depreciation on a continuous basis makes imports more expensive given the high import content of Sri Lanka’s trade basket. High import expenditure has cascading effects on all imports, including oil and other intermediary goods imports. Then the cost is felt by entrepreneurs, industries, investors, and finally by the whole country. Banks operating in the forex market therefore, should not only be concerned of their profits but also of their public policy responsibilities.

Ranee Jayamaha: Recent economic developments, challenges and strategies – proactive strategies in reducing inflation Speech by Dr Ranee Jayamaha, Deputy Governor of the Central Bank of Sri Lanka, at the Central Bank of Sri Lanka, Colombo, 25 May 2007. *  *  *  Inflation is a common enemy. Its impact will be felt by every single person in a country. Managing inflation and reducing inflationary expectations cannot be achieved by the Central Bank of Sri Lanka (CBSL) alone. It can only be done collectively and with cooperation from all stakeholders. Who are these critical stakeholders ? CBSL, the government, banks and financial institutions, fund managers/traders/dealers operating in various markets, investors both local and foreign households and consumers. 1. Central Bank of Sri Lanka  Given its prime objective of maintaining price stability, CBSL has been proactive in the conduct of monetary policy, which is the instrument through which this purpose can be achieved. CBSL sets monetary targets taking into consideration growth prospects of the economy, liquidity requirements necessary to facilitate growth and inflation at a desired level. The ultimate aim is to keep inflation at desirable levels and reduce inflationary expectations. CBSL, at its disposal, has a limited number of instruments to conduct monetary policy. The current framework places greater reliance on market-based instruments, such as changes to the policy interest rate and conduct of open market operations. Accordingly, CBSL has announced its monetary policy strategy and targets at the beginning of 2007.