samchain/econo-pairs-v1 huggingface dataset:
Table 2 Net foreign purchase of US long-term securities Government bonds  Governmentsponsored 1 agency bonds  Corporate bonds  Corporate stocks  Total  1995  134,115  28,729  57,853  11,240  231,937  1996  232,241  41,723  83,743  12,511  370,218  1997  184,171  49,853  84,358  69,597  387,979  1998  49,039  56,802  121,930  50,020  277,791  1999  –9,953  92,200  160,392  107,522  350,161  2000  –53,790  152,841  182,403  174,890  456,344  1  Includes bonds issued by U.S. government corporations and federal agencies. Source: IMF. Central banks around the world have been a driving force behind the trend toward collateralisation. First, they have been relying increasingly on repo transactions to implement their monetary policy. Like many of its peers, the Swiss National Bank, which traditionally operated exclusively on the basis of foreign exchange swaps, now steers the liquidity supply primarily through repo transactions. Second, central banks typically grant intraday credits, which are relevant for smoothing settlement in payment systems, against collateral. Intraday repos have been available from the Swiss National Bank since 1999, on demand and at zero interest. The trend toward collateralisation creates additional business opportunities for providers of financial market infrastructure, but it also increases their systemic relevance.

Indeed, since the linkages among cash, securities, and derivatives markets have become so close, a failure - either by a provider itself or by a major participant - is very likely to cause disturbances affecting different markets at the same time. In addition to collateralisation, the appetite for securities has been forcefully stimulated by the changing needs of private and public wealth owners: the ongoing institutionalisation of the savings process, the facilitation of direct market access through internet technology, the disintermediation of the banking system due to credit risk considerations and the relative decline in attractiveness of bank deposits. On the supply side, the corporate sector has been increasingly relying on bond financing rather than on traditional bank borrowing. In the US, private debt securities amount to about USD 7 trillion. The ratio of bank credits to GDP has remained more or less stable at around 10% for the last 50 years, while the ratio of bond financing to GDP has risen sharply from 15% in 1985 to 25% in 2000. Bond financing within the European corporate sector has also caught up, strongly supported by the inception of the euro at the beginning of 1999. In short, the supply of securities is bound to grow further; cyclical ups and downs are likely, but the trend will point upwards. Notwithstanding obvious differences between economies, it is generally true that the corporate sector will make further progress in exploiting the potential advantages offered by open capital markets. The European corporate bond market seems an especially interesting case.
Even though during the early years of the Exchange Market’s operation in the 1860’s, the amount of foreign direct investment in Turkey was negligible, foreign capital was being encouraged to form joint stock companies. Up until the beginning of the 20th century, the Market helped the government find funds to finance its obligations. In 1906, the Istanbul Exchange Market was re-organised and once more became a source of new capital for young private ventures. BIS Review 42/1997  -2-  Without giving the whole history of the Istanbul Exchange Market, I want to emphasise that Turkey’s experience with free markets did not begin in 1980 but goes back more than a century before. What the reforms of 1980 did accomplish was to institutionalise the markets and put them on a solid legal footing. Besides liberalisation, the structural reforms begun in 1980 included measures providing investment and tax incentives. I would like to review these issues briefly. The aims of these incentives were to encourage activities that would earn foreign exchange on the one hand, and to help foreign sources of capital finance investments in Turkey on the other. It can be said that by liberalising its capital account and introducing structural tax changes to improve investment returns, Turkey issued an invitation to foreign capital.

Taking these in turn, data form the core of all AI models and good data management and data governance are essential in controlling issues with, for example, biases that may be embedded in the data. At the model level, we need to think about issues such as ensuring that models continue to perform under a wide range of different conditions and being able to explain the outputs of complex AI systems. Moving to the firm level, some of the key issues will revolve around risk management and governance structures; around accountability and appropriate controls. And finally, for the financial system as a whole, AI may amplify network effects such as unexpected changes in the scale and direction of market moves. In terms of the regulatory challenges, it’s clear that policy thinking in this arena is also evolving rapidly. But the existing regulatory landscape is somewhat fragmented when it comes to AI, with different pieces of regulation applying to different aspects of the AI pipeline, from data through model risk to governance. Policy must strike a balance between high-level principles and a more rules-based approach. We also need to future-proof our policy initiatives in a fast-changing field. With all that in mind, and in order to further our objective of promoting the safe adoption of AI in financial services, the Bank of England, along with the Financial Conduct Authority, is today launching the Artificial Intelligence Public-Private Forum.
See, for instance, “Vägen till ett stabilare Sverige” (the road to a more stable Sweden), Economic Policy Group report 1985, Center for Business and Policy Studies (SNS). A retrospective  BIS central bankers’ speeches  3  Almost at once, the question arose of what would guide monetary policy in Sweden, now that the fixed exchange rate had been abandoned. 6 By this time, some countries had already introduced inflation targets: New Zealand was the first in 1990, followed by Canada in 1991 and the United Kingdom in 1992. In January 1993 the Riksbank decided to introduce the inflation target we have now: The annual rate of increase in consumer prices shall be 2 per cent a year. 7 As we saw earlier, it is extremely important that the nominal anchor is credible. The results of academic research indicated that the conditions for attaining low inflation increased if one delegated monetary policy to an independent central bank, which focused on a clearly quantified target. This increased the element of “norm-based thinking” in monetary policy. The motives for short-term deviations from the inflation target declined, for instance, by trying to stimulate demand to gain political sympathies prior to an election. This also reduced the so-called time inconsistency problem in monetary policy, where the long-term objective of low inflation is not compatible with the short-term motives for high inflation. 8 The new Sveriges Riksbank Act meant that we have had an Executive Board with six members and greater independence from the political system since 1999.

A pattern can be discerned here; on several occasions before we have underestimated US consumer demand, in spite of rather optimistic forecasts. Thus, there may be reason to revise down the forecast of households’ saving ratio in the coming years, which if so would point to higher consumption growth. The increasingly weak dollar and stronger euro should also boost US exports, particularly in Europe. In the short term, there is really only one serious concern in the US economy: that employment growth continues to be weak. This could create uncertainty among households and contribute to subduing consumption. But it is hard to believe that it would derail the current upswing. Also with regard to Europe, we began to see signs of somewhat more robust growth and greater optimism at the end of last year. In our assessment in December, we forecast a rise in growth in the years ahead. New data received since December broadly supports this assessment. Business tendency surveys for manufacturing indicate that optimism has continued to increase while industrial production has now begun to rise slowly, although for the euro area as a whole the picture is still not as unambiguous as in the US. The strong performance of the euro could also result in higher imports and lower exports than expected, which of course would have an impact on demand in the economy and growth.
That was potentially a very important supportive step as a good proportion of businesses in the UK had floating rate loans which were linked to the LIBOR rate. GDP stabilised by the end of 2009, and grew at close to trend rates in the first half of 2010. The prospect of deflation, which had been a hot topic during early 2009, now seems much less likely. Indeed, press commentary through 2010 has instead mostly been focused on the elevated rate of CPI inflation (which reflects the temporary impact of a series of short-term price level shocks). 7 Why we did it the way we did Although QE was an “unconventional” monetary policy operation, it was not totally without international precedent, having been tried most notably in recent times by Japan. The Japanese programme is generally considered to have been a mixed success at best. Such a judgement is perhaps unfair but there were a number of lessons to be learned from their  3  For further discussion, see Cross, Fisher and Weeken, (2010), “The Bank’s Balance Sheet During the Crisis”, Quarterly Bulletin, 50, 1, pages 34–42. 4  See Benford, Berry, Nikolov and Young (2009). “Quantitative Easing”, Quarterly Bulletin, 49, 2, pages 90–100. 5  Joyce, Lasaosa, Stevens and Tong (2010). “The Financial Market Impact of Quantitative Easing”, Bank of England Working paper number 393. 6  London Inter-Bank Offer Rate – see http://www.bbalibor.com. 7  For more discussion see Fisher (2010), “Why is CPI inflation so high”. Speech to the Merseyside Young Professionals, June.

Consequently, Switzerland must do everything it can to secure its competitive position in this changing world – now and in the future. Third, convincing answers will be needed to counter the international pressure on Switzerland, which has increased considerably of late, particularly in connection with the question of the tax compliance of foreign assets in Switzerland. These are formidable challenges. However, Switzerland is well equipped to meet them with confidence. What is essential is that we are able to benefit from the strengths that characterise the country now as in the past. These success factors include (a) a social and political culture that builds on inclusiveness and the ability to reach a consensus, (b) innovative ability and flexibility, and (c) political and economic stability. BIS central bankers’ speeches  1
2  BIS Review 71/2008  transmitted via financial markets to the real economy and to prices. 4 Monetary policy therefore strongly relies on well-functioning and liquid markets. The tensions in the money markets in recent months therefore posed a serious headache to most central banks. Not only did money market tensions indicate potential problems for financial stability, but it also threatened the smooth functioning of the transmission mechanism of monetary policy. The second important point concerning the transmission of monetary policy is the fact that it is not the current value of the policy rate that matters. Rather, it is the expected future path of that rate that determines the stance of monetary policy. For example, a central bank can have an impact on the economy simply by signalling that its own view about the future path of the monetary policy rate is different from the current market view. If the central bank is credible, market expectations will adjust correspondingly and financial prices will henceforth reflect the new view communicated by the central bank. 5 3. Chronology of the crisis  After these preliminaries, I will now turn briefly to the origins and the course of the financial market crisis, and in particular, the liquidity tensions brought about by the turmoil. The US housing market stands at the epicentre of the financial market crisis. After rising for several years, US house prices peaked in 2006.

Finally, by offering to borrow and lend overnight automatically, the Bank would relinquish day-to-day control over its balance sheet and the degree of risk associated with that. To summarise, there are different models for implementing the policy rate, each of which has its own merits and disadvantages. These reflect both monetary policy and financial stability considerations. A deeper exposition of the arguments can be found in Clews, Salmon and Weeken (2010).8 The Bank has carefully considered the differing systems and expects to return to a reserves averaging system in due course. Presumptively, that would be after increasing Bank Rate and before asset sales began – although the timing and sequencing will depend on the circumstances at the time. In the next section of this paper we explore more deeply some of the financial stability aspects of the Bank’s operations. The Sterling Monetary Framework: providing liquidity insurance Banks inherently engage in “maturity transformation” – borrowing on a short-term basis but lending on a long-term basis (eg taking deposits which can be withdrawn at short notice, and lending for mortgages). As a result, banks take liquidity risk – and even a well-run bank could suffer an unexpected shortage of liquidity. As part of their liquidity management, banks hold stocks of liquid assets that can be used to generate cash or make payments directly. Some assets are expected to retain their liquidity in all but the most extreme circumstances.
What influences developments in the housing market? Norges Bank’s calculations show that high wage income has pushed up house prices. The contribution from interest rate changes has also been high in the past two years but has diminished somewhat recently. Interest rate changes have a strong and rapid impact. From 2004, housing starts were substantially as a result of high house prices, low interest rates and a favourable economic outlook. In Oslo in particular, housing starts have been high. A higher supply of dwellings will reduce pressures in the housing market. 4/6  When we increase the interest rate, we expect house prices to rise at a slower pace. Norges Bank increased the interest rate by ¼ percentage point last summer. Before this increase, banks’ mortgage rates fell, even though Norges Bank’s sight deposit rate remained unchanged. Stiff competition for mortgage loans and lower capital requirements for mortgage loans when the Basel II Accord comes into force may have contributed to this. In recent years, nominal long-term interest rates have fallen more than inflation. The real interest rate has declined. This may not only be an expression of economic conditions, but may also reflect a lower normal level for real interest rates. A lower normal real interest rate level will result in higher equilibrium prices for all capital goods, including houses, because the present value of future returns increases.

Long periods of strong growth in debt, asset prices and investment may be a source of subsequent instability and problems in the financial system. We have observed this phenomenon both in Norway and in other countries. When optimism turns to pessimism, the financial system can come under pressure. However, it is not possible to determine with any certainty the value of debt, asset prices and investment that may constitute an unacceptable risk in this context. The pace of growth in household borrowing cannot be sustained over time. It would probably be wise for both borrowers and lenders to acknowledge that the root of subsequent problems, and demanding corrections, is often to be found during such periods. Thank you for your attention. 6/6
Financial institutions will be required to keep proper records related to employees and to provide the required information when requested by another institution. This will guard the system against disreputable staff and enact barriers against potential threats to the integrity of the system. As guardians of the system, bankers need to look at these requirements as useful enabling tools or defenses that help with their mission to successfully protect the integrity of the system. Guardians of knowledge and wisdom The complexity scientist, Samuel Arbesman in his study of how knowledge develops, postulates that knowledge behaves like radioactive decay. Every fact has a ‘half-life’ and it will inevitably decay. It means that the frontier of knowledge also changes constantly. What we know today may be untrue tomorrow. This rings true for matters concerning banking. The immediate manner in which our knowledge becomes obsolete certainly ties in with our experience in banking and society at large. For one, the complexity of economic, environmental and social challenges seems to increase exponentially. Furthermore, much of the knowledge frontier remains unexplored. Consider this. We only utilise less than 0.5% of our existing data. There is a long way to go. The potential is enormous. In all likelihood, what we know today will be vastly different in two, five and 10 years into the future. We see this happening already in the banking sector, with the greater use of technology and in particular, more creative use of data analytics to better serve consumers and business needs.

Peter Pang: Hong Kong Mortgage Corporation retail bond issues Opening remarks by Mr Peter Pang, Deputy Chief Executive of the Hong Kong Monetary Authority and Executive Director of the Hong Kong Mortgage Corporation Limited, at the Signing Ceremony for the Retail Bond Issue under the HKMC's Retail Bond Issuance Programme, Hong Kong, 1 September 2006. *  *  *  Good afternoon ladies and gentlemen, On behalf of the Hong Kong Mortgage Corporation, I welcome you all to this signing ceremony for the new retail bond to be offered to the public next Monday. Five years ago, in October 2001, the HKMC introduced a mechanism to offer retail bonds through placing banks. This move received very warm welcome from both the banking sector and retail investors. So far, we have issued eight retail bonds for a total amount of $ billion. Two major factors are behind the success of the HKMC's retail bond issues. First it is our strong credit rating. In fact, our credit rating has recently been upgraded by S&P’s to AA with stable outlook and by Moody's to Aa3 with positive outlook. Secondly, the HKMC meets the needs of retail investors through continual product innovation. On this occasion, we again bring some new features to our retail bond issuance. Apart from issuing two-year notes in Hong Kong Dollar and in US Dollar, we are introducing a new 10-year Hong Kong Dollar Zero Coupon Bond.
However, of course the Riksbank does not react in a mechanical manner to a measured change in inflation expectations. The Riksbank currently monitors a number of indicators of future inflation developments and, responses to its surveys about inflation expectations are just one of many. By way of conclusion there is reason to call attention to the fact that inflation expectations to an ever greater degree are being guided by the inflation objective and not by our or others’ discussions of the risks of inflation. The signs of this are clear. The expected inflation has crept down markedly and has now been stabilised in the vicinity of the objective for most of the groups currently monitored by the Riksbank. This is a profoundly positive development, which actually facilitates the monetary policy task. (Diagram 4.

These indirect effects account for part of the widening incidence of above target inflation developments across a broad set of core goods and services components of the overall index. Third, these shocks have been large. Again, it is useful to use energy prices as an example. Page 5  Looking at the daily data, from its trough in May 2020 at 8 pence per therm, spot UK natural gas prices rose to above 500 pence per therm in the immediate aftermath of the invasion of Ukraine. Taking a wider perspective, we have seen European wholesale gas prices rise by more than 300% over the past year, while electricity prices have risen 30% and oil prices by 50% over the same period. And fourth, since the UK is a net importer of goods and energy, these large rises in international goods and energy price represent a deterioration in the UK terms of trade. Simply put, the goods the UK buys from the rest of the world have become more expensive relative to the services it sells. Other things equal, this will weigh on the international purchasing power of UK residents. In practice, we anticipate a squeeze on UK household real incomes, which constrains domestic spending and demand, and threatens to open up a margin of economic slack and eventually higher unemployment in the UK. So it is not just UK inflation that is affected by the large external price shocks, but UK incomes, spending and employment too.
As a long-term and global investor with ownership stakes in several thousand companies, it is in the GPFG’s financial interest that portfolio companies succeed in adapting to the risks and opportunities that climate change entails. Norges Bank supports the strengthening of the work on climate risk in the GPFG. Responsible investments and active ownership will be key in this regard. Active ownership is directly aimed at the primary source of the GPFG’s climate risk, namely its portfolio companies. Norges Bank’s responsible investment shall be based on the long-term goal that investee companies align their activities in a way that is consistent with global net zero emissions in accordance with the Paris Agreement. 1/2  BIS central bankers' speeches  The GPFG’s size gives it strong access to company boards. The GPFG is among the ten largest owners of around half of its portfolio companies, and it is our experience that when we talk, the companies listen. Through active ownership, Norges Bank will be a driving force for the companies in the portfolio to align their business models towards a long-term goal of global net zero emissions. To this end, the Bank will strengthen our work on analysing decarbonisation pathways for individual companies and use these analyses in our follow-up of companies. It will not be the case that we will automatically divest if active ownership does not have the desired outcome. But in some cases, divestment may be relevant. In the period 2012–2021, Norges Bank made 366 risk-based divestments.

Ida Wolden Bache: Norges Bank’s management of the Government Pension Fund Global Introductory statement by Ms Ida Wolden Bache, Governor of Norges Bank (Central Bank of Norway), at the hearing of the Standing Committee on Finance and Economic Affairs of the Storting (Norwegian parliament), 3 May 2022. * * * I would like to thank the Committee for its invitation. Norges Bank manages the GPFG with the objective of achieving the highest possible return over time within the limits of the investment mandate defined by the Ministry of Finance. The objective of the highest possible return is to be achieved within an adequate control and risk management framework, in a responsible and cost-efficient manner with a high degree of transparency. The investment mandate is extensive. Around 70 percent of the over NOK 11 000 billion in the GPFG is invested in equities, which means we are one of the world’s largest shareholders. We a minority shareholder in around 9000 companies in 70 countries. In addition, we have a broad portfolio of fixed income investments. Some of the GPFG is invested in unlisted real estate, and in 2021, we also invested for the first time in unlisted renewable energy infrastructure. The GPFG is managed to track the benchmark index fairly closely, so that the return largely tracks the return on the benchmark index. The benchmark index is defined by the Ministry of Finance and endorsed by the Storting.