samchain/econo-pairs-v1 huggingface dataset:
In addition, reforms aimed at removing rigidities and expenditure trigger effects in social welfare transfers would also be appropriate in some countries. The capacity of economies to respond successfully to the challenge of euro adoption would be further enhanced by a greater degree of price and wage flexibility. Generally speaking, the NMS have a satisfactory track record on this count, at least compared with the non-core euro area countries, but the extent to which the existing flexibility is enough to enable a sufficiently rapid catching up process in the context of an increasingly competitive global trading environment is yet to be assessed. An overriding consideration relates to the degree of vulnerability that an economy might experience during its participation in ERM II. This is now generally perceived as a testing period to be entered into once the economy is deemed a credible candidate for euro area membership, but not to be postponed to the extent of unduly retarding the adoption of the euro, with the consequent negative effects on policy credibility. Indeed, the exposure to the international markets which participation in ERM II implies requires NMS to follow even more prudent policies, especially on the fiscal front, compared to existing euro-area countries. This is needed to compensate for the vulnerabilities, not least that arising from capital account openness, which the NMS are facing. This aspect of ERM II appears not to be sufficiently understood by advocates of delayed euro adoption in some of our countries.

As a result, the ECB has a clearer and more credible inflation target, since this 2% target eliminates the possible impression of asymmetry that could stem from the previous target (“below, but close, to 2%”) and seeks to provide a clear anchor for inflation expectations. As I will highlight later on in my talk, this definition also confirms the medium-term orientation of monetary policy that already existed under the previous strategy. This medium-term orientation provides room for inevitable short-term deviations of inflation from the target, as well as for lags and uncertainty in the transmission of monetary policy. Moreover, the flexibility embedded in this medium-term orientation also allows for an appropriate monetary 5  policy response to inflation deviations from the target that takes into account the origin, scale and persistence of the underlying shocks to inflation. Second, the ECB has taken into account the monetary policy implications of the lower bound on interest rates. In particular, the new strategy establishes a requirement for especially forceful or persistent monetary measures when the economy is close to the effective lower bound, in order to prevent negative deviations from the inflation target from becoming entrenched. This may also imply a transitory period of overshooting in which inflation is moderately above target. I will also refer to this key aspect of the new strategy in the third part of my talk today. And third, the ECB has made explicit that the set of policy rates remains its primary monetary policy instrument.
Moreover, the study finds that measures such as attracting foreign workers and raising the retirement age from 60 to 65 have only small impact at boosting the economy’s long-term growth and that the key to maintaining high growth rate lies in enhancing productivity growth rather than trying to squeeze out more hours from the aging population. While improvement in educational and skill attainment of the labor force and de-bottlenecking of inefficient sectors such as improvement in the logistic system and water management for irrigation are most obvious policies, financial deepening must not be neglected. It is the efficiency of resource allocation which includes funds and capital that enhances economic productivity, hence, raising the economy’s long-term growth potential. This is the focus of the rest of my talk to which I now turn. Ladies and Gentlemen, As you know, the fundamental function of financial markets and intermediaries is to channel funds from those who have a surplus of savings to those who have a deficit. If financial markets are functioning efficiently, they contribute to an optimal allocation of resources, reduce the cost of capital, and allow for risk-sharing and risk-diversification. Well-developed and efficient financial markets contribute to higher productivity growth because they are better at channeling capital from sectors in decline to those with growth opportunities, in a  BIS Review 118/2008  3  process of Schumpeterian “creative destruction” that ultimately drives economic growth.

This formal process of close coordination would help ensure that monetary policy is aligned with the country’s overall economic policy direction. More importantly, it will also contribute to a greater understanding of the public at large of the fact that the only long-term role for monetary policy is in creating an environment of price stability which would help support sustainable economic growth. In addition to the mandated responsibility of maintaining price stability, the BOT has also taken a direct role to further develop Thailand’s capital market and its infrastructure via our involvement in the National Capital Market Development Committee and the Domestic Bond Market Development Sub-committee which were set up to coordinate capital market development efforts among government agencies as well as the private sector. With regard to equity market development, beginning in 2002, we have taken a step-by-step approach in opening up outward portfolio investment, by first allowing institutional investors, such as mutual funds and insurance companies, to invest abroad. This year, as Thai investors have become more familiar with diversifying risks abroad and with financial instruments in more developed markets, we have now allowed Thai individuals to invest abroad through local securities company. Through this initiative, not only local investors and professionals in the capital market industry would have a better understanding of the link between the local market and the global market, as well as risk management strategy, it would help contribute to higher standards and practice in the local capital market in the long run.
“The results of the policy have been devastating for the Swedish economy” The picture that critics like to paint is of a high repo rate pushing down demand and creating a more or less deflationist situation in the Swedish economy. This is something that some international analysts in particular seem to have latched onto, interpreting the situation in Sweden today to be similar to that in Japan in the 1990s.19  16  See, for instance, Schularick and Taylor (2012) and Jordà, Schularick and Taylor (2013). 17  See, for example, Jansson (2014). 18  In some cases, the critics have also had diametrically opposed views. Paul Krugman appears to think that Sweden has probably already had a housing bubble for some time, and that as it is too late to do anything about it, the Riksbank should not conduct a policy that leans against the wind (see Andrén Meiton, 2014). Lars Svensson, on the other hand, appears to think that there is no great risk of a housing bubble building up (see Svenska Dagbladet newspaper, 2014a) and that a policy that leans against the wind for this reason is not needed, but is harmful. 19  See, for instance, Krugman (2014a, 2014b) who as well as likening Sweden to Japan, has also characterised monetary policy in Sweden as an example of ”sadomonetarism”. Among Swedish critics it is less common to make comparisons with Japan.

Mr. George conveys his reflections on the development of bond market yields over recent years Remarks by the Governor of the Bank of England, Mr. E.A.J. George, at the Euromoney International Bond Congress held in London on 25/2/97. I’m honoured to have been invited to open this 3rd Euromoney International Bond Congress. I remember with great pleasure launching your initial Congress in October 1994 in the Barbican. It is an even greater pleasure now to launch the QEII! That first Congress was an ambitious and imaginative venture. But it immediately established itself as a major event in the international financial calendar. I congratulate Euromoney on that achievement, and, to judge from the program, on organising an even bigger and better Congress on this third occasion. I am delighted to welcome you all here. I remember our debate at that first Congress particularly well, Mr. Chairman. I remember it because I looked up my notes over the weekend! The context then was one in which yields had fallen very sharply, to unusually low levels, almost everywhere during 1993 only to back up just as sharply during 1994. We concluded, I think, that none of us really understood either the earlier strength of the market or its subsequent weakness! But we had a very enjoyable two days of discussion.
I would only like to mention that the National Bank has commenced the activities for implementing BASEL II in the Macedonian banking system. Does and will this crisis have an impact on our economies? It already has and it will have an additional impact depending on its duration. The first blow is for the real sector. In all of our countries, depending on the structure of the economy, the export sector will be most severely hit. BIS Review 18/2009  5  Consensus Forecasts of October 2008, envisages that the growth of the US economy will equal 1.4% and in 2009 it will be 0%, with a projected fall of the personal consumption and faster decline in the investment consumption. The growth of the EU economy for 2008 has been adjusted downward (1.4%) and for 2009 it is 0.6%. For an illustration, 60% of the Macedonian export is in the EU countries. The trading conditions have already deteriorated and we project further deepening of the trade and the current account deficits, whereas the increased minus between the exports and the imports will act toward reducing our growth rate. We expect a negative impact also in the capital and financial accounts, but at this moment it is difficult to quantify it. Banking will not be hit directly. There is no exposure in risk-bearing financial instruments. Deposits are dispersed according to the regulations.

On the financial markets, the trust to the others plummeted to a point below which the investors sought their way out mainly in the government instruments, for example US Treasury Bills, which at a certain point had a negative yield. Distrust went much further than the sub-group of vulnerable banks. The reports reveal that USA and Europe have registered market losses from the asset loans of nearly 3 trillion US Dollars. Regardless of the fact that all these losses will not encumber the banks and can overemphasize the losses of those able to keep the debt until the maturity, the investors and their partners became very concerned about the amount of the actual losses in the banking and trade portfolio in broader scope of the institutions and their capability to continue financing their business. The focus of the concern moved from prospective profitability to prospective survival. That is why the CDS premium increased to unprecedented ranges, the prices of the banks' shares plunged, while the money market overdried. The interbank lending margin deepened dramatically, the lending, as I mentioned previously, reduced to only overnight loans. Around October 6 and7 even the overnight loans stopped. How did the central banks of the countries in the crisis' epicenter respond? In the beginning, the central banks were committed to provide liquidity as much as necessary. The volume of the liquidity support from the central banks of USA, England, Europe was without precedent in the history so far.
There is little to suggest that the US federal budget deficit will narrow to a sufficient extent. That is worrying, especially given that the country in the long term will see sharply increasing costs for medical care, health care and pensions. As a result there is a clear risk of rising market rates in the US that could trigger a fall in house prices, which in turn could dampen private consumption. A reduction in public expenditures would also have a tightening effect but in the long term would lead to a more balanced development and thereby prevent an overly quick rise in rates. Another risk factor is the oil price. As the US is more oil-dependent than the euro area countries, its economy is more sensitive to changes in oil prices. Should the oil price remain at a high, fluctuating level it may curtail growth in the US. All in all, this picture of large global imbalances implies a clear risk that growth will be more subdued over the coming two-year period. The question is how fast this slowdown may come about. If controlled, the moderation would be softer, while rapid changes could entail a considerable weakening of the world economy and thereby also check Sweden’s economic performance in the period ahead. In addition to the competition problems that an ever stronger euro means for Europe there is the issue of how we are to meet the competition from low-wage countries, both the new member states of the EU and the emerging economies in Asia.

The system switches to a low-liquidity equilibrium. These liquidity droughts were perhaps the defining feature of the financial crisis during 2007 and 2008. In the model, the likelihood of such systemic liquidity crises depends critically on two key structural characteristics of the financial system – the two c’s: concentration and complexity. The greater the concentration within the financial system, the greater the potential for systemic collapse as larger banks spread a disproportionate amount of financial pain around a densely networked financial system. A greater degree of system complexity has a similar effect, creating more channels for contagion and heightening banks’ incentives to hoard liquidity when the weather worsens. The two c’s are very much features of today’s financial system. On the face of it, that bodes ill for future systemic crises. So what role might policy play in avoiding those crises? The model provides a test-bed to consider a range of policy options, including for haircuts policy. An illustrative policy experiment, based on a simulation of the model in which haircuts spike sharply, is shown in Chart 1. Up the vertical axis is a measure of the probability of a systemic liquidity crisis. Along the horizontal axis is the initial size of the haircut on secured financing transactions. The three lines trace three policy options. Consider first the “baseline” path without policy intervention. Provided haircuts remain high come rain or shine – in the example, above around 20% – the probability of a liquidity crisis remains very low.
One hard-won lesson was particularly important: the central bank must keep the crown and government at arm’s length and must not extend credit to government. Control of the printing press would promote economic stability and prevent unrestrained money printing to finance spending by the crown. Two hundred years later, safeguarding the value of money remains monetary policy’s main task. Responsibility for monetary policy rests with Norges Bank, but today policy is geared towards maintaining stable inflation rather than a stable currency backed by a precious metal. The Bank’s role has also changed in other areas. From being the country’s only bank, Norges Bank took on the role of the bankers’ bank, with the new responsibilities that entailed. The central bank also has a responsibility to promote robust financial markets. The core of Norway’s payment system is housed in this building. Two hundred years as a central bank in a small open economy The Norwegian economy has changed over the past 200 years. In the early 1800s, eight in ten Norwegians worked in agriculture, forestry and fisheries compared with one in forty today. But some important features have not changed. Norway is a small open economy and developments abroad have an impact at home. Our foreign trade is largely based on natural resources. In the early 1800s, fish, timber and shipping were the mainstays of our economy. In recent times, oil and gas sales have accounted for a large share of Norway’s export revenues.

The war generated substantial profits for the shipping industry and fuelled speculative behaviour resulting in a credit and asset price boom. Monetary policy did not contribute to dampening these developments. There was a sharp increase in the money supply and inflation soared. Between 1914 and 1918, the price level more than doubled. After the war, exports fell and the krone depreciated to about half of the statutory exchange rate. At the same time, the economy was faced with a banking crisis and recession. This created a dilemma for monetary policy. The prevailing view was nonetheless that the krone had to be brought back to parity. The task fell to Nicolai Rygg. The active deflationary policy pursued proved to be costly. However, Rygg stood firm in his belief that breaking the promise made in 1816 to preserve a stable value of money would entail more serious consequences:  BIS central bankers’ speeches  3  “The hardships we are facing in the transition to normal, ordered conditions are transient. No one can close their eyes to the fact that they are very serious, but the life of the people is eternal and the consequences of this decision will remain with us for generations.” Those were Rygg’s words in his annual address in 1927. A year later, in 1928, the policy of gold parity had achieved its objective. Consumer prices had fallen by more than 40 percent since 1920. But the gold standard would only survive three years.
Goodhart and Rochet point out in their evaluation that the construction with mean squared deviations has its limitations, as it focuses on central expected outcomes and thus overestimates the certainty in comparisons of alternative outcomes and that the figures should be accompanied by fan charts that show the probability intervals for both production and inflation.25 I consider it important to calculate and report the uncertainty in the comparisons, if this type of figure is going to be used to a greater extent. 24  See the article “Evaluation of different monetary policy alternatives” in Monetary Policy Report, October 2009. 25  Op.cit., p 66. 8  BIS central bankers’ speeches  Develop the models so they can process different repo-rate paths We should develop our models so that they can process different repo-rate paths. One problem with regard to the base for monetary policy decisions is that the Ramses model can only process one repo-rate path. It cannot handle a situation where the Riksbank’s repo-rate path differs from the market’s repo-rate path. The repo-rate path used in a forecast with the Ramses model also implicitly determines the current longer-term interest rates along the entire yield curve, and these may differ from the interest rates currently observed in the market. This means that problems arise with regard to analysing developments, when the Riksbank’s repo-rate path differs from the market’s repo-rate path. Further development of the model would improve the base for monetary policy decisions.

If you are honest only in some places or circumstances, but not others—or only with some people, but not others —then honesty is hardly integral or integrated into your life and work. The importance of this particular meaning of “integrity” was made apparent to me on a recent visit I made to the United States Military Academy at West Point. The faculty and students there believe that strong individual ethics are what make large organizations like the U.S. armed forces succeed. The commitment of cadets to living the ideals of the institution was impressive and humbling. They embodied the word integrity—alignment of word and deed in all aspects of life. Another lesson that I took from West Point is that cadets commit to integrity because their careers—and, in combat, their lives—depend on others. We are in this together—this city, this industry, this country. And if we’re in it together, we all have to behave in ways that benefit the group.7 We have to behave in ways that merit the trust of others. Whether we are citizens or soldiers, the most important relationships in our lives are built on trust. In our personal lives, we take action when our trust has been betrayed. To reform financial services, we need to bring the same expectations of trust—and the consequences of a breach of that trust—to the office each day. If you would not tolerate a practice in your personal life, do not tolerate it in the office. Calling out bad conduct is not easy.
BIS Review 17/2007  7  CPI Annual percentage change 4  4  3  3  2  2  1  1  0  0  -1 M ar-02  M ar-03  M ar-04  M ar-05  M ar-06  M ar-07  M ar-08  M ar-09  -1 M ar-10  Sources: Statistics Sweden and the Riksbank Note. Broken lines represent the Riksbank’s forecast. CPI with uncertainty bands Annual percetage change 4  4  90% 75% 50% CPI  3  3  2  2  1  1  0  0  -1 M ar-02  M ar-03  M ar-04  M ar-05  M ar-06  M ar-07  M ar-08  M ar-09  -1 M ar-10  Sources: Statistics Sweden and the Riksbank Note. Broken lines represent the Riksbank’s forecast. 8  BIS Review 17/2007  Repo rate assumptions Per cent 5  5 M ain scenario Higher interest rate Lower interest rate  4  4  3  3  2  2  1  1  0  0 04  05  06  Note. Broken lines represent the Riksbank’s forecast  BIS Review 17/2007  07  08  09  10  Source: The  9

Chile)  1.8 1.4 -0.6 9.3 7.9 4.2 4.5  2.3 -0.5 1.9 7.7 5.6 3.5 2.8  2.2 -0.6 2.0 7.8 4.9 3.8 2.8  1.9 -0.3 0.5 8.0 6.6 4.3 3.3  1.9 -0.4 1.1 8.1 6.3 4.3 3.3  2.3 1.2 0.9 8.2 6.4 4.7 3.7  2.5 1.3 1.3 8.2 6.4 4.7 3.7  LME copper price $ Brent oil price $  400 111  361 112  361 112  (levels) 340 350 105 108  350 100  340 101  Terms of trade  -0.6  -5.0  -4.1  1.3  -1,6  (annual change, percent) -0,8  -0.4  (e) Estimate. (f) Forecast. Sources: Central Bank of Chile based on a sample of investment banks, Consensus Forecasts, IMF and statistics bureaus of respective countries.