samchain/econo-pairs-v1 huggingface dataset:
Jesper Roine, professor at the Stockholm School of Economics has divided them up in a useful manner.3     Automation – a machine doing the work of a person. Digitalisation – converting information to a digital form. Technological advances – broader concept that covers the other two but also other things. The concepts are of course related. Digitalisation can enable automation and is an example of technological advances. In this speech I focus on digitalisation, but will also touch on the automation that follows on from digitalisation. I wish to include in the concept of digitalisation here machine learning, artificial intelligence, 3D printers and the use of cloud services and Big Data. A common collective name often used for several of these technologies is Industry 4.0 or the Fourth Industrial Revolution. Will productivity increase? How far have we come with regard to the digitalisation of the business sector? One hears an awful lot about technological developments in the media and in business journals. From what is written one might easily gain the impression that we can do more and faster. But official data on productivity does not confirm this. The fact that statistics and reality sometimes appear to be disconnected from one another is nothing new. In 1987 economist Robert Solow wrote “you can see the computer age everywhere but in the productivity statistics”, when describing the emergence of information and communication technology (ICT) and the relatively low productivity growth in the United States in the 1980s.

The original target date of 2020 was advanced to 2015 this year. Obviously, there are practical difficulties of integration given the diversity in the region and the different levels of development. ASEAN leaders have tasked an Eminent Persons Group to come up with an ASEAN Charter to guide ASEAN's future development. This will mark a new phase of deeper ASEAN integration. Geo-strategic shifts The re-emergence of India and China, and the revitalisation of ASEAN are taking place within a broader geo-strategic context. Let me now examine some of the larger trends. At one level, Asia is slowly but surely coalescing. The entire region is being sewn together by changing patterns of trade, investment and production chains. Increasing economic integration is reflected by the rapid expansion of intra-Asia trade. From 34% in 1980, intra-Asian trade as a share of the region's total trade has grown to more than 50% in 2005. The transformations taking place in Asia are of a depth and scope historically unprecedented. The combined population of Northeast Asia, Southeast Asia and India is well over 3 billion, about half the world's population. Changes of the scale that are currently underway could be profoundly unsettling to international order. Strong growth will give Beijing and New Delhi the resources to pursue wider strategic interests across Asia and beyond. Strategic stability is not to be taken for granted, particularly in Asia where there are many territorial and other unresolved issues left over from historically complicated relationships. Great power competition and rivalry are facts of life.
In general terms, there are two ways to address ex ante the problems that SIFIs pose: you can restrict the scope of their activities or force them to internalise the costs they pose to the system. The clearest illustration of the first approach is the discussion on the “Volcker rule” in the United States. Under this rule, banks that receive deposits would be prevented from engaging in proprietary trading, and investing in or sponsoring hedge funds and private equity funds. I do not believe this is the most fruitful way to pursue in Europe, given the traditional strength of the universal banking model in a number of Member States. Also, there may be challenges associated with defining the borderline between the proprietary trading and servicing clients. But more importantly, the activities that are seen as deserving special attention may move outside the intensively regulated and supervised banking business, but stay within the same group. One could argue that the same effect of controlling for risks stemming from the trading business can be reached by imposing higher capital requirements on banks’ trading book activities, and this seems to be the way that is being pursued internationally. The Basel Committee has already increased the capital requirements for a number of trading book activities, and a fundamental review of the trading book is planned for next year. The Basel Committee is looking as well into how to get the SIFIs to internalise the potential costs they pose to the financial system.

Then I will turn to four eye-catching initiatives:   first, the establishment of the European Systemic Risk Board or ESRB, a new body that will for the first time become responsible for macro-prudential supervision in the EU;    second, how policy makers are dealing with systemically important institutions;    third, the issue of procyclicality or the dynamic interplay between the financial sector and the real economy;    fourth and last topic to which I will pay some more attention is the mandate of central banks in the area of financial stability. Let us now embark on our architectural walk! II. Causes of the current crisis  Much has been said about the root causes of the current crisis over the past three years. I will not expand on this topic but I will just mention specific factors – some of them of a macroand others of a micro-economic nature – which in my view were key in the run up to the crisis. In the two or three years before the crisis erupted, a constellation of factors, including very favourable macro-financial conditions combined with strong growth, low inflation, ample liquidity, exceptionally low volatility across virtually all financial markets and extraordinarily low risk premia, had the effect of covering up the building up of significant imbalances. Significant financial imbalances were in the making, at various levels of the global economy and financial system.
The more inclusive process to global standard setting is therefore very much welcomed and needs to be further enhanced through continued open dialogue and support for implementation approaches that are more responsive to unintended consequences at a jurisdictional level. Today, the Bank will communicate its intention to extend the observation period for the Net Stable Funding Ratio, or NSFR, in Malaysia for another year to 2020. This takes into account the Bank’s intention to conduct further on-site assessments to validate the maturity and robustness of the liquidity and funding practices of banks, and uneven progress in implementation at the global level. 3/4  BIS central bankers' speeches  The Bank remains committed to implementing the NSFR requirements as part of overall liquidity standards applicable to licensed banks in Malaysia. At present, all banks maintain adequate liquidity buffers against short term liquidity stress, and the vast majority of banks already report NSFR levels above the minimum 100% based on observation data. Let me now draw my remarks to a close. The task of financial stability authorities is to prepare for the worst, and work for the best. There are rarely easy fixes to the issues that we face, but also no shortage of diverse experiences to draw from and to guide our path. It is my hope that this conference will serve to generate useful discussions that will help inform our own preparations to confront any eventuality, and strengthen our conviction that being prepared is better than being right.

I can assure you, Ambassador Franco, that we look forward to continuing the successful cooperation with you and your staff that we had during the previous project. I would also like to thank you and your collaborators for having supported the preparations and for your help in handling a number of technical, administrative and legal issues. Sound practices in the fields of banking supervision and internal audit are important not only for the effective performance of the tasks of a central bank, but also because they contribute to the efficient and stable functioning of the financial system that benefits the economy as a whole. We have noted with great interest the reform efforts of Chairman Ignatiev and his team in the Bank of Russia over the past years. With this programme, the Eurosystem hopes to contribute to further strengthening the Bank of Russia’s banking supervision and internal audit functions. Allow me to conclude by expressing my confidence that the implementation of this programme will be characterised by the close and constructive cooperation between the Eurosystem and the Bank of Russia, as well as with the Delegation of the European Commission to Moscow. Za nashe sotrudnichestvo! Thank you very much for your attention. 2  BIS Review 32/2008
When the effects of these transitory influences wane, inflation will begin to move closer to our 2 percent objective for the personal consumption expenditures deflator. Second, the tightening of the labor market may soon lead to some strengthening in the labor compensation trend. Although the recent data are as a whole inconclusive, I find it noteworthy that the four-quarter change of the Employment Cost Index for all civilian workers, which I view as the most reliable indicator of labor cost trends, rose by 2.6 percent as of the first quarter of this year, up from around 2 percent in the first quarter of 2014. Also, work done by my staff suggests that we are at that point in the labor market recovery where, in the past, we have typically seen a pickup in wage compensation. Third, the risk that inflation expectations, which are important in influencing inflation outcomes, might become unanchored to the downside seems to have diminished. In particular, anxieties created by the decline in breakeven inflation compensation measures based on the relative yields of nominal Treasuries versus TIPs have lessened. For example, the 5-year forward, 5-year inflation compensation measure has climbed by about 25 basis points from its low point in late January. 3 Implications for monetary policy So what are the implications of the economic outlook for U.S. monetary policy?

2  BIS central bankers’ speeches  Regarding global activity, a stronger growth outlook has consolidated in developed economies together with a slowdown in the emerging world. Still, some downward adjustments are being made to the projections for this year, mostly driven by actual first-quarter data, leading to a marginal adjustment in the overall figure. Thus, it is expected that in the period 2014–2015 our trading partners will grow 3.7 percent on average, a tenth of a point less than was expected in March. In Latin America a less favorable picture emerges. Downward revisions in Argentina, Brazil and Mexico stand out in these settings. The price of copper has fluctuated significantly in recent months. After coming close to $ per pound, it returned to the order of $ The baseline scenario assumes copper prices of 3.1 and 2.9 dollars per pound in 2014 and 2015, respectively. The terms of trade would fall this year slightly less than projected the March IPoM, but somewhat deeper in 2015 (table 1). Inflation has remained well contained in developed countries, while in emerging markets, particularly in Latin America, the short-term outlook has been revised upwards, reflecting the depreciation of Latin American currencies in the past year. This, plus the changes in parities mean that foreign dollar inflation this year and next will be somewhat higher than forecast in the last Report. The Board estimates that in the baseline projection scenario, inflation in Chile will remain above 4 percent still for some months, ending 2014 around that figure.
For it to be credible, we need commitment on sound backstops as a fall-back option for fulfilling capital needs. In Japan, such a close inspection of bank balance sheets was carried out in 2002. It proved to be an important step to recognising losses and cleaning balance sheets to eventually set off a gradual recovery with credit expansion in Japan. Second, one of the objectives of a European banking union is to delink banks from their sovereigns. That also implies that bank funding costs will depend on the quality of banks’ assets, and not on the location of their headquarters. Achieving this would mark a milestone in that it would establish a single capital market throughout Europe that companies can tap into. A single capital market, in turn, provides better financing for companies and eases productive investment, which will revitalise the European economies. Ultimately, it will be decisive in ensuring that Europe avoids a repeat of Japan’s “lost decade”, during which zombie banks poorly allocated financing across firms. Third, orderly deleveraging in the euro area also requires that the restructuring and resolution of individual banks will not endanger financial stability or put public finances at risk. For this, the institutional framework needs to be solid. This is the rationale  10  Entries of business establishments declined from their peak of 7.4% in 1988 and have not exceeded 5.0% since then, whereas exit rates remained at subdued levels of 2.5–4.0% between 1988 and 2000 and have increased to above 4.0% since then.

Furthermore, real estate prices continued to rise but, as in 2013, momentum remained below the levels observed until 2012. Developments still varied widely from one region to the other. Whereas real estate prices in some regions hardly increased or even decreased, other regions continued to register significant price rises. However, it is still too early for an all-clear. First, the imbalances that have built up since the beginning of the low-interest-rate phase remain at a high level. Second, mortgage interest rates have again dropped to historically low levels in the past few months. And third, there are no broad-based indications of a change in the banks’ risk appetite. Mortgage lending growth at the domestically focused banks has also decreased, but is still markedly higher than overall market growth. Moreover, the affordability risk (loan-to-income ratio) in mortgage lending has continued to rise, interest rate risk remains at a historically high level, and interest rate margins have fallen even further, from a level which was already low. In these exceptional circumstances, banks should ensure that their resilience is high enough to be able to bear the risks taken, even in the event of a marked real estate price correction combined with an interest rate shock. The countercyclical capital buffer plays a significant role in this context by ensuring that banks hold additional capital as a buffer in the current situation. Adding to that, many banks have a surplus of capital with respect to the regulatory requirements. Such surplus capital is especially important under the current circumstances.
In the UK, I don’t think we saw a major prudential failure of capital and liquidity which did not have a governance and management story at is root, and we had a system which was very poor at creating the right incentives for good outcomes. Here I want to put the emphasis on creating the right incentives. In my experience supervision is in part about creating and overseeing those incentives. The critical distinction here is that supervision is not just about doing things to firms, it is also about creating the conditions for firms to do this right thing in the first place. Let me give three examples of what we are doing. 2  BIS central bankers’ speeches  First, we have been much more active in remuneration policy and practice. I have no interest in regulating the level of pay, but we are interested to ensure that remuneration is compatible with meeting capital requirements (so it can be varied to do so) and that variable remuneration is deferred and can be withdrawn, and is thus compatible with creating the right incentives by putting that remuneration at risk if the firm fails to conform with the objectives of safety, soundness and good conduct of business. I am not in favour of limiting variable pay in the way European legislation has done through the so-called bonus cap because it reduces the opportunity to create the right incentives. We then supervise firms to ensure those incentives remain in place.

It’s an argument which seems to say, we can’t value the firm, we can’t supervise it, and we can’t resolve it, so therefore let’s ensure it has a very large amount of equity financing, what I call the “Big Equity” argument. Honestly, it’s a nonsense. Large amounts of equity financing will not be available for such firms, so the best we can say is that this is a route to a radically different financial system, but in that world the risk goes somewhere else, and we shall still be worried. But this is not an argument against having non-risk based tools like the leverage ratio in the supervisors’ toolbox. They are very important, because to understand risks well, we need more than one view of the firm. And the leverage ratio is an important other view. But I want to emphasise that understanding risk is at the heart of supervision. BIS central bankers’ speeches  1  But this, of course, begs a very important question. Why did supervision go wrong in the period before the financial crisis, and what do we learn from that bad experience? Let me offer a number of thoughts on that. First, supervision was never given sufficient prominence and attention. It’s a very real skill. In my experience it demands not just high levels of technical skill but also interpersonal skills – to get very strong egos to change their thinking and actions – do things that they had not intended – to recognise the public interest.
For example, we will not entertain attempts at fishing for banking information and other spurious requests. As with all major international financial centres, customer confidentiality is a cardinal principle of our financial sector. It will only be lifted by a Singapore court order and only if the safeguards set out in the Mutual Assistance in Criminal Matters Act are met. These provisions do not shield criminal activities. Singapore will continue to participate actively in the fight against crime, money laundering and terrorist financing. Going forward, we will work to deepen the sharing of knowledge and practices with jurisdictions that approach us for assistance through training programmes. We believe that we can make contributions on economic and financial issues, particularly those pertaining to the region. For instance, our unique monetary policy framework has proved to be sufficiently robust and flexible to cope with shocks in the external environment. We are keen to share our experience through research papers, policy dialogues and seminars with developing countries which are experimenting with intermediate exchange rate regimes. IV. Conclusion  Let me conclude. I have outlined our priorities for the next five years. Our emphasis is on action. We must translate the seminar findings and conclusions into a set of practical initiatives and implement them. We must be prepared to take calculated risks and adapt as we go along. This will require not just hard work and dedication, but also a spirit of openness, inquiry and enterprise. I am confident that together we can achieve our goals for MAS and Singapore.

This development was the main reason underlying the downward revision in the outlook for inflation and monetary policy in the last three months. 12  BIS Review 67/2009  Figure 20: Quarterly GDP Growth Rate  Figure 21: GDP  (Percent)  (Seasonally Adjusted Fixed Prices of 1998, Billion TL) 27  12 9.4  10 8 6.8  6.2  6  8.4  7.3  6.9 5.3  25  4.7 2.8  4  1.2  1.1  2  23  0 -2 21  -4 -5.7  Source: TURKSTAT. 2008-2  2008  2006  2004  -6.2 2002  2000  -8  2008-4  -6  19 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 2004  2005  2006  2007  2008  Source: TURKSTAT, CBT. An analysis of Gross Domestic Product developments in terms of output in the last quarter of 2008 reveals that all the subcomponents except those of the agriculture sector contributed negatively to growth. A comparison of this financial crisis with that in 2001 points to a similarity between not only the Gross Domestic Product growth rate, but also the composition of production sectors (Figure 22). On the other hand, making the said comparison also in terms of expenditures is crucial considering the projections pertaining to the timing of the possible rebound in economic activity.
The powers and governance of the three authorities could also be adjusted to further improve their efficiency, but I do not think it would be useful in the short term to radically change the existing architecture. Greater changes – which could also bring supervision and resolution closer together – could be considered once Brexit has occurred and the Banking Union and the Capital Markets Union are well established. With regard to Brexit, I would like to reiterate a requirement which, in our view, is obvious: clearing operations in euro, for all those of systemic importance, must be located where the supervision of the Eurosystem can be exercised effectively. And after Brexit, we do not see how this could be in London. 1/3  BIS central bankers' speeches  II. The 2016 results of the French banking and insurance sectors In 2016, in a context marked by the low level of interest rates, the major French banks showed solid performances and compared favourably with their European counterparts. Their profitability increased, with their net profit (group share) amounting to EUR 24.3 billion, up 3.1% over the year. Moreover, the French banking system was able to strengthen its higher quality capital, while maintaining the financing to the economy. The ratio of core capital now stands at 13.2% of riskweighted assets, up 60 bp from 2015; this represents a EUR 164 billion increase in capital since 2008 for the major banks, i.e. more than a two-fold increase: an increase of more than 120% in less than 10 years.

Since the turning point last autumn, however, we are witnessing a very gradual rise in nominal long-term interest rates and a “steepening” of the yield curve. This is a more favourable development for bank profitability, which could turn into a weakness in the event of a sudden rise in rates: I do not believe this hypothesis is the most likely. But the ACPR remains particularly attentive to the supervision of the interest rate risk management frameworks put in place by banks. The next stress test exercise, currently underway, will look at different scenarios regarding interest rate variations. As regards the insurance sector, the moderation of the rates paid out on life insurance policies is necessary to preserve their solvency. Luckily, we have observed such a trend in 2016 on eurodenominated products, although the average return remains significant at 1.9%. The low interest rate environment has also prompted a shift in savings towards unit-linked products. Here the ACPR is vigilant as to the commercial conditions of this development. The second challenge is the rise of digital finance. Supporting new players is a priority for the ACPR, which we have materialised by the creation of the Fintech Innovation unit and the Fintech Forum with the AMF. Fintechs bring innovative solutions for customers, which are very welcome, but they must also be attentive to data protection, cyber-security and compliance with anti-money laundering measures. But the digital challenge is not limited to Fintechs.