samchain/econo-pairs-v1 huggingface dataset:
It is duly assigning additional resources and focusing on the matter more closely. Far from being a passing fad, improving corporate governance should receive priority attention from banks. Not only because of the factors habitually cited, but also because the new environment of transparency associated with IAS and Basel II will simultaneously involve greater market scrutiny, a greater capacity for action by bank managers and, in sum, heightened responsibility for them. My final comments relate to the internal changes at the Banco de España. The year 2002 has also been important in this respect in view of the reforms initiated, which will continue in the coming years. Last year the Banco de España successfully met the logistical challenge of substituting euro for pesetas. While the intensity of this process has diminished, it has nevertheless continued this year. I should like to reiterate my gratitude to the staff at the Banco de España for their efforts and dedication, which have been on a par with the historic significance of this event. 8  BIS Review 31/2003  Likewise, last year saw the start of an ambitious plan to rationalise our network of branches, located in each and every Spanish provincial capital. The restructuring involves acknowledging what is a fact: namely, that many of the services provided by the branches do not -owing mainly to new technologiesrequire a physical presence. And those requiring physical presence can be more efficiently organised through a smaller group of better-equipped logistical centres.

Given a stock market climate already depressed by the ongoing correction of the bubble that affected the technology and communications sector, this lack of confidence further propelled the downward trend on the equity markets, which favoured the fixed-income markets. Moreover, the crises in certain emerging economies continued, especially in Latin America, and this also contributed to the general risk-aversion of investors on international financial markets. A key feature of recent developments in the world economy is that the aforementioned shocks, whose common denominator is their impact on agents’ confidence, affected all the developed economies and some of the emerging ones almost simultaneously. This highlights how, in an increasingly globalised world, the transmission channels on which expectations turn (and which exert a key influence on the financial markets) are extremely rapid. All economies, especially the most developed ones, are prone to the impact of this type of disturbance, whose origin may be very remote and whose relationship to a specific national economy’s fundamentals may seem far-removed. The loss of confidence stemming from the aforementioned shocks was, in turn, amplified by various deep-seated imbalances in the world economy which have not been corrected or have even worsened, including most notably the US current-account deficit and persistent deflation in Japan. These underlying weaknesses stoked up uncertainty and a climate of mistrust in various segments of the world economy, all of which contributed too to checking and postponing the onset of recovery.
Chart 11: Private sector job-to-job flows have picked up, having moved closely with wages in the past, but less closely recently…  Chart 12: The REC survey measure of pay for new recruits has picked up sharply, but its relationship with official data on average pay has become less robust. Source: ONS, Labour Force Survey and Bank calculations. (a) The number of people who report being in a private sector job in the first quarter, and then report being in a private sector job for less than three months in the second quarter of the survey. Source: ONS, KPMG/REC/Markit and Bank calculations. (a) Left-hand scale, lagged three months. The REC measure is produced by weighting together survey indices for the pay of permanent and temporary placements using shares in employment. (b) Right-hand scale. Private sector regular pay growth versus single month a year earlier.

By 1914, while the U.S. was already the world’s largest economy and trading nation, its banking system remained curiously parochial and the dollar was not a major international currency. 8 In fact, American firms continued to finance their trade almost entirely with credits from foreign banks, a source of resentment, with Paul Warburg, the first Federal Reserve vice chairman, referring to the annual acceptance fees paid to London banks as a form of “tribute.”9 With the passage of the Federal Reserve Act in 1913, some of the constraints on the emergence of a robust dollar trade financing market were removed and the newly established U.S. central bank could take a more active role in nurturing and backstopping a nascent dollar acceptance market, which it did. These efforts included buying dollar acceptances for foreign central bank accounts at competitive discount rates and providing guarantees, for a small fee, on payments at maturity of acceptances bought for these accounts.10 These actions helped to spur the dollar’s emergence as an important international currency, with dollar acceptances viewed as an attractive reserve asset by the 1920s. The early accounts also represented tangible links of cooperation among major central banks, with much of this cooperation centered on efforts to maintain or restore the international gold standard in the aftermath of the First World War. 11 The reciprocal relationships enabled central banks to buy and sell foreign exchange to influence credit conditions in each other’s markets with the aim of regulating cross-border gold movements.
In this way, experimentation allows us to send the right signals for the ecosystem to realise the potential of new technologies without fearing a delayed and unexpected “backlash” from the Supervisory Authority. The experiments underway at the Banque de France on a central bank digital currency (CBDC) are an illustration of the same experimental approach in the field of work specific to central banks. They present with issues directly related to the need for the Eurosystem, should circumstances require it, to be ready to issue a CBDC in order to ensure that central bank money is accessible to the general public and to preserve their freedom of choice of means of payment and their confidence in our currency. By testing the possible uses of a CBDC, we investigate not only the potential of blockchain technologies but we also question the players in the ecosystem on what tomorrow’s landscape could look like, on subjects as fundamental as the methods of exchanging financial instruments for CBDCs, the improvement of the conditions for executing cross-border payments or new ways of making CBDCs available to financial sector players. 2/4  BIS central bankers' speeches  *  *  The second thrust of our work is to promote a regulatory framework and appropriate supervisory practices. In this respect, our immersion, as a player, in the innovative FinTech ecosystem is a valuable asset that we intend to build on in order to contribute to the impending and necessary changes in regulations and supervision.

Denis Beau: For a contribution from our FinTech ecosystem to a more efficient and stable financial system Speech by Mr Denis Beau, First Deputy Governor of the Bank of France, at the FINTECH R:EVOLUTION 2020, Paris, 15 October 2020. * * * I would particularly like to thank Olivier Fliche for his contribution in preparing this speech. Ladies and Gentlemen, I am delighted to take part in this 5th edition of Fintech R:evolution and I would like to warmly thank the France Fintech association and its chairman Alain Clot for their invitation to speak today. This event, organised against the backdrop of the ongoing health crisis, is proof of the drive, determination and adaptability not only of the organising association, France FinTech, but also of the entire innovative French ecosystem of the financial sector, which is now represented here as widely as possible. The French FinTech ecosystem, like any ecosystem made up of start-ups, is fragile but it is promising and, I believe, vital to the financial sector. The economic crisis associated with the health crisis highlights these contrasting characteristics: on the one hand, start-ups may be weakened or innovative projects delayed by the economic situation; and on the other hand, the health crisis has accelerated the adoption of new digital habits by the entire population. More generally, 2020 has only served to underscore the challenges facing the financial ecosystem as a whole as a result of the digitisation of our economy.
During the same period, the number of foreign banks with subsidiaries or branches in Turkey increased from four to 20. As of November 1998, 60 banks out of 74 are universally commercial banks and the remaining 14 are development and investment banks. Thirty-six of these banks are commercial banks whose majority shares are privately owned; 20 are foreign banks established in Turkey or having branch offices in Turkey; and 14, as noted above, are development and investment banks. As of November 1998, Turkish banks now operate though their 7,062 local branches. More than 165,000 persons are employed in the banking sector. In addition, the Turkish banking system is aggressively modern, adopting every banking innovation rapidly. Turkish banks, operating in parallel with the process of internationalization and globalization, have gone one step further by starting to invest in foreign financial establishments as well. Turkish banks are now able to form joint ventures with foreign banks to open financial subsidiaries and branches abroad. As of November 1998, Turkish banks had 63 financial subsidiaries in 19 different countries, and 26 branches in 10 different countries. As of November 1998, the size of the consolidated balance sheet of the banking sector was $ billion. According to our peer group classification by ownership, public and private banks both have significant shares in the sector.

As I pointed out in my brief remarks on the financial standing of the banking sector, Turkish banks have reached a level of financial and institutional development that should not be underestimated. But despite all the aforementioned positive aspects, there are also various threats to the wellbeing of the Turkish banking sector which I believe are worth mentioning. Turkish banks, like all the other banks in the world, are exposed to credit risk, liquidity risk, interest rate risk and foreign exchange risk. This is true even in the absence of an environment of global crisis and macroeconomic risks stemming from political uncertainties. These are other issues that merit separate consideration. I will turn now to financial risks. The most important of these is credit risk, which Turkish banks pay the most attention to managing. The Turkish banking sector has become used to accepting and managing credit risk over the years. A credit culture has been developed in which firms, sectors, regions and individuals participate. Increased competition in the sector clearly has implications for the risk-taking process, which requires that the banks restudy their credit strategy. An overall examination of credit risk showed that the banking sector has been able to manage its credit risks by keeping the level of non-performing loans low in spite of an environment of shrinking international financing.
Many who have been critical of the policy conducted by the Riksbank claim they support the monetary policy framework and the inflation target. But bearing in mind the aim of monetary policy having been to keep inflation around the target and to maintain confidence in it, and that the Riksbank has had to work quite hard to achieve this, it does not seem far-fetched to conclude that the criticism is implicitly nevertheless that the target itself should have been different. This is true at least if one believes that monetary policy could have been very different to what it has been. And this is exactly the opinion many critics must be perceived to have; otherwise it is difficult to understand at all why the discussion is so lively. In this context, it can be worth emphasising that the expansionary policy conducted by the Riksbank has been just enough to bring up inflation to 2 per cent. Inflation has never been excessively high in recent years, but on the contrary has recently fallen back somewhat and is now once again below the target. It is therefore difficult to see how we, so to speak, have gone too far in view of our target. I think it is reasonable that those who claim they support the monetary policy framework and the inflation target, but nevertheless have been critical of the policy conducted, take this into consideration.

The reason is that it has proved difficult in practice to lower nominal wages. If inflation is low and nominal wages cannot be lowered, then it becomes difficult to adjust real wages between different professions, companies and sectors. This can ultimately lead to both higher unemployment and poorer productivity growth in the economy. A moderate level of inflation mitigates these problems. It functions as grease in the wheels of the economic machinery. Another advantage with an inflation target of 2 per cent, which has come to the fore in recent years, is that it creates at least some scope for lowering the policy rate before it reaches its lower bound. If the inflation target, and hence average  4 [17]  inflation, were to be lower, then the nominal rate would also on average be lower. This would be particularly problematic in a world where real interest rates are very low, as is currently the case. The scope for lowering the rate before it reaches its lower bound would then be more limited than it is today, which would make it more difficult to counteract future recessions. Therefore, if one does not like negative interest rates, one should not advocate a lower inflation target, as that would imply that the policy rate would have to be negative for longer periods. In the international debate, moreover, there are several economists who think that not even an inflation target of 2 per cent provides sufficient scope to conduct as expansive a monetary policy as is sometimes necessary.
However, we assume that households will choose to spread consumption over time, so that the saving ratio will continue to fall in spite of an increase in interest rates. Housing construction activity is still high. In January and February, housing starts were 17.5 per cent higher than in the same period last year. Growth in housing investment is expected to ease through 2005. However, the projection for housing starts is also very high for 2005. Such a high level of housing starts over several years probably means that more dwellings will be constructed than implied by underlying demand. As a result, housing investment is expected to decline after a period. Higher interest rates and weaker developments in the Norwegian economy may also lead to a fall in residential construction after a period. The rise in house prices has moderated, and prices in March were 8.2 per cent higher than in the same month last year. The upturn in mainland fixed investment is broadly based. Stronger profitability, higher capacity utilisation and solid export growth will contribute to continued investment growth in goods-producing industries. Demand for services is expected to continue to grow for a period ahead with an attendant increase in investment in service sectors. When growth in the economy gradually slows, investment growth will probably slacken. Mainland exports of goods and services will also benefit from solid global growth this year. Later in the period, a continued loss of market shares as a result of high cost levels will dampen export growth.

3  According to the Food Outlook from the Food and Agricultural Organization of the United Nations (FAO), 22 May 2008. BIS Review 68/2008  3  When we decide on the future direction of monetary policy, it is important to know whether the rising oil and food prices will have lasting or temporary effects on inflation. 4 It is difficult to know this in advance. We must follow developments closely. But we can receive some guidance by looking at the factors that lie behind the price increases. Increased demand, supply effects and portfolio investment behind rising commodity prices One reason for the high commodity prices is the increased demand in the world market from emerging economies. Higher incomes per capita in China, India and other rapidly growing economies have led to increased demand for food and also to changes in the patterns of food consumption. Demand for meat has increased in particular, which has in turn pushed up the demand for and prices of feed grain. This also spreads to other food crops. It is reasonable to believe that the demand for food in the world will remain high. Another important driving force behind the world demand for commodities is the investment in ethanol and biodiesel in recent years. The increased use of some food commodities in the production of biofuels limits the supply of food and increases the price of food crops.
Our approach at the Fed seeks to achieve this outcome for the major institutions for which we are the consolidated supervisor. But the basic argument for applying exacting standards for risk based capital, for liquidity management, and for operational resilience applies to a broader range of supervised and regulated financial institutions whose operations pose significant systemic implications for the financial system. This is particularly compelling in the case of the major GSEs, where the regulatory framework, capital regime and sophistication of the internal risk management framework need to be upgraded to a standard more commensurate with their risk profile and the risks they present to the system. It is as compelling in the case of the institutions - a number of them specialized financial utilities - that make up the core of the payments infrastructure. Here, because of their overall importance to the functioning of our financial system, we are working to encourage improvement in operational resilience, to ensure they meet the recently updated international standards for risk management and internal financial resources, and to strengthen the oversight framework. It is important to note that the SEC has itself outlined a framework that would provide a form of consolidated supervision of the major investment banks with a risk-based capital framework based on Basel II.

Sukhdave Singh: Financial governance and economic growth Keynote address by Dr Sukhdave Singh, Deputy Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the Malaysian Economic Convention “Financial Governance and Economic Growth”, Kuala Lumpur, 28 September 2015. *  *  *  It is indeed an honour to be speaking to such a distinguished audience. It is also a great pleasure for me to be here this morning and join my colleagues in the Economics fraternity at this 2015 Malaysian Economic Convention. To begin, let me share with you a story. Twenty years ago, on 28 January 1986, the NASA space shuttle Challenger was launched. Seventy-three seconds into its flight, spectators were horrified as the space shuttle broke apart in a fiery display and disintegrated over the Atlantic Ocean. Seven astronauts died. The catastrophe was traced to the failure of a single O-ring – a simple seal at a joint on one of the rocket boosters. The O-ring failed due to the unusually cold temperatures on the morning of the launch. Relative to the highly sophisticated technologies involved in building and launching the shuttle, the O-ring was considered established technology, one with a patent history of 90 years by the time the Challenger was launched. It was as ironic as it was instructive that such a complex machine, incorporating the most advanced aerospace technology of its time, failed and combusted due to a component as trivial and basic as an O-ring.
Through these successive waves, the world financial system found itself with almost every link in the credit chain – in the chain of trust – having been weakened or broken. That is evident in surveys of the public’s trust in industry: banking and finance are firmly rooted to the foot of the league table of trust, in the UK and internationally (Chart 6). That loss of trust is mirrored in aggregate bank lending in the UK, in particular to companies, where annual growth has fallen from a peak of 23% in March 2008 to around zero now (Chart 7). And this has in turn been reflected in the largest and most synchronous global economic slowdown since the Great Depression. Confidence and credit So how is trust, and thereby credit, to be restored? To date, the answer has been to rely on the one sector whose credit has not been seriously questioned – governments and central banks. There has been large-scale provision of government and central bank credit over the past two years in an attempt to ease pressures and shore up breaks in the private sector credit chain. These interventions have been unprecedented in size during peacetime. The total potentially on the table is in excess of $ trillion.7 That is roughly $ for every man, woman and child on the planet. Half of the world’s 20 largest banks have needed direct government support. Central bank balance sheets in the major financial centres, including in the UK, have more than doubled in size.

So the economics of banking do not suggest that bigger need be better. Indeed, if largescale processing of loans risks economising on the collection of information, there might even be diseconomies of scale in banking. The present crisis provides a case study. The desire to make loans a tradable commodity led to a loss of information, as transactions replaced relationships and quantity trumped quality. Within the space of a decade, banks went from monogamy to speed-dating. Evidence from a range of countries paints a revealing picture. There is not a scrap of evidence of economies of scale or scope in banking – of bigger or broader being better – beyond a low size threshold.12 At least during this crisis, big banks have if anything been found to be less stable than their smaller counterparts, requiring on average larger-scale support.13 It could be argued that big business needs big banks to supply their needs. But this is not an argument that big businesses themselves endorse, at least according to a recent survey by the Association of Corporate Treasurers.14 Take Grameen Bank – not a household name in the UK, I realise. This grew out of a microfinance project in Bangladesh which began in 1976.15 Grameen operates as a set of local credit cooperatives, often comprising as few as five members. The bank’s relationship with its borrowers is bound not by legal contract but by trust.