samchain/econo-pairs-v1 huggingface dataset:
Unemployment and annual CPI inflation 1976–2012 and the long-run Phillips curve 1997–2011 16  16 Unemployment and annual CPI-inflation 1976-1997 Unemployment and annual CPI-inflation 1998-2012 Long-run Phillips curve 1997-2011  CPI-inflation, annual percentage change  14 12  14 12  1976  10  10  8  8  1991Q4  6  6 1993Q4  4  4  2011Q3  2  2  1998Q1  0  0  -2  -2 1  2  3  4  5  6  7  Unemployment, per cent  8  9  10  11  12  Note. Annual inflation from 1998 Q1 and onwards (in red) is a moving average of four quarters’ quarterly inflation, that is of quarterly inflation 1997 Q1 and onwards. The long-run Phillips curve is in Svensson (2012d) estimated with quarterly inflation in the period 1997–2011. The dashed horizontal line corresponds to an average CPI inflation of 1.4 per cent. Sources: Statistics Sweden and own calculations. 14  BIS central bankers’ speeches

In Norway, this resulted in a period of low nominal interest rates set by the government authorities, direct regulation of credit through quotas set out in a separate credit budget, channelling of loans for special purposes via state banks, regulation of cross-border capital movements, a fixed but adjustable krone and occasionally the use of price and wage regulation. For a period, regulation and fine-tuning seemed to be having the intended effect. But in the 1970s, inflation got out of control in Norway and in a number of other countries. The Norwegian economy experienced a price/wage spiral. Although the krone was devalued several times in the 10-year period from 1976 to 1986 in pace with high price and wage inflation, this was nonetheless not sufficient to prevent a decline in the manufacturing sector. In 1980, Odd Aukrust, Head of Research in Statistics Norway, stated the following with regard to developments in the Norwegian economy: "Unfortunately there is even less reason for optimism this time. It seems that competitiveness in Norwegian manufacturing will deteriorate in the year ahead. The main problem is that no one can control price  4  See Ecklund (2008), p.120. BIS Review 111/2008  3  developments. With annual inflation at approximately 10 per cent, no one dares to invest in measures that could stop this price carousel.” 5 High inflation showed that the economic policy framework was not functioning as intended, and the importance of providing the economy with a nominal anchor became evident.
We borrow today, because we are confident that the income will come tomorrow. How can debt be reduced? While the financial crisis in 2008 brought debt growth to a sudden halt in some countries, debt growth continues to outpace income growth for Norwegian households. This can hardly go on forever. If debt needs to be reduced, the question is how? Sovereign borrowers can levy taxes and thereby have a reliable source of revenue. Even so, being the creditor of a sovereign can be risky. In 1918, after the Russian Revolution, the Bolsheviks repudiated all debt issued by the previous regime. French investors, among them many small savers, held nearly half of the Russian national debt at the beginning of the First World War. They were among the first big losers of the Russian Revolution.2 In the inter-war period, these losses had consequences for French foreign policy. France became a fierce opponent of the Soviet regime. The losses on Tsarist bonds may have also contributed to France’s unwillingness to restructure German debt after the war. Germany’s debt burden contributed to the hyperinflation of the 1920s and the fall of the Weimar Republic. Now, on the evening of 9 April, 79 years after the German invasion of Norway, we can conclude that debt m have fateful consequences. After Boris Yeltsin raised the Russian flag in 1991, the French creditors returned. Old bond certificates were retrieved from drawers. A final settlement was agreed in 1996.

Mugur Isărescu: In support of central bank independence Address by Mr Mugur Isărescu, Governor of the National Bank of Romania, at the Conference on “The role of a central bank in modernising society – challenges in emerging economies”, organised by the National Bank of Moldova, Bucharest, 7 April 2021. * * * Dear Governor Armașu, Distinguished guests, adies and gentlemen, Good morning, Let me start by congratulating the National Bank of Moldova on the initiative of holding this conference. I believe that discussions on the proposed topic are welcome at the current juncture, when light needs to be shed both on the measures to rescue the economies hit by the COVID-19 pandemic and on central banks’ mission. The question about what a central bank can and cannot do is always on the agenda. Governments and central banks throughout the world have promptly stepped in to address the fallout from the pandemic by means of social, economic, fiscal and monetary policies. Such comprehensive and unprecedented support has proven that, in situations like this, the concerted action of the authorities – particularly monetary and fiscal ones – is critical to safeguarding the smooth functioning of markets, of economic and social mechanisms. The topic of this roundtable, The role of a central bank in modernising society – challenges in emerging economies, is however more comprehensive than the response to the challenges of the unprecedented medical crisis we are currently facing.
This decision was a critical step in moving monetary policy expeditiously away from the very accommodative stance that we put in place early in the pandemic. The Committee is strongly committed to returning inflation to its 2 percent objective. In determining how quickly and how high to raise the rates in the future, we'll watch closely to see how the economy responds to tightening financial conditions and how inflation, inflation expectations, and the economic outlook evolve. As always, we will be data-dependent and nimble in our approach. With tighter monetary policy in place, supply and demand will be brought back into balance, and inflation will return to our 2 percent longer-run goal. This may take some time and may well be a bumpy road. Closing I'll close with this: Inflation is far too high, and price stability is absolutely essential for a strong economy. We have the tools to get the job done and are one hundred percent committed to achieving our goals. Thank you. 1 See Federal Reserve Bank of New York, “Regional Economy Profiles: Puerto Rico;" Federal Reserve Bank of New York, “Puerto Rico Economic Indicators." 2 Ruchi Avtar, Rajashri Chakrabarti, and Maxim Pinkovskiy, “Was the 2021-22 Rise in Inflation Equitable?," Federal Reserve Bank of New York Liberty Street Economics,  June 20, 2022. 3 Board of Governors of the Federal Reserve System, Federal Reserve Issues FOMC Statement, June 15, 2022.

At the outset of the Conference, it has been clearly articulated by our EU speakers that the enlargement of the EU and the economic and monetary integration of acceding countries will not only strengthen the role of the EU as a global player in the long term, but also make a sustainable contribution to global stability and prosperity. On the developments and prospects for ASEAN, our ASEAN speakers have more than stressed that the overall economic and financial transformation that has occurred in ASEAN since the Asian financial crisis has resulted in an ASEAN that is a mutually reinforcing region of growth; an ASEAN that has an increasing role in the creation of wealth; and an ASEAN that will remain as an important region in promoting and supporting global stability and growth. This Conference has revealed to us that both our regions are currently at the confluence of favourable factors; factors that have led to a marked expansion in the base of opportunities that we can offer each other. It is imperative that our discussions on taking advantage of the emerging opportunities be translated into concrete actions. We are of course aware that implementing these actions will demand decision and leadership from both ASEAN and the EU. From the proceedings of the Conference, it seems to me that there may be a need to develop a more entrenched mechanism to leverage further on our respective core capabilities and which seeks to find simpler, faster and more effective ways that would enhance our joint endeavours.
7  The major UK banks on average now have total loss absorbency of around a quarter of their risk-weighted assets (RWAs) compared to an average end-state requirement of around 28% (including buffers). 8 While no measure is perfect, a range of market-based estimates suggest the implicit ‘too big to fail’ subsidy has fallen sharply since the crisis. Estimates suggest that the value of the implicit subsidy has fallen from around £ in 2010 to less than £ now – down around 90% http://data.parliament.uk/writtenevidence/committeeevidence.svc/evidencedocument/treasury-committee/capital-andresolution/written/69208.pdf 11  All speeches are available online at www.bankofengland.co.uk/speeches  11  If counterparties have confidence that resolution will stabilise a bank so that it can continue to meet its obligations, they will not accelerate actions that could frustrate a resolution to the detriment of all parties. And the public needs to have confidence that we have learned the lessons of the crisis: that we have acted to ensure that we have an alternative to the previous crisis where we had privatisation of bank profits in good times and the socialization of bank losses when things go wrong. 9  For that reason, the Bank committed to Parliament in April 2017 and in the Purple Book last October that from 2019 we would implement public reporting of banks’ resolution plans and our assessment of their effectiveness. This marks an important transition in the implementation of full resolvability in the UK.

Central Clearing and Resolution – learning some of the lessons of Lehmans Speech given by Sir Jon Cunliffe, Deputy Governor Financial Stability, Member of the Monetary Policy Committee, Member of the Financial Policy Committee and Member of the Prudential Regulation Committee  FIA International Derivatives Expo 2018, London Tuesday 5 June 2018  1  All speeches are available online at www.bankofengland.co.uk/speeches  When Lehman Brothers failed in September 2008, the bank was a major player in the worldwide derivatives market. Its $ trillion portfolio of both cleared and uncleared derivatives represented around five percent of the global derivatives market. Following its collapse, Lehman’s uncleared derivative counterparties filed claims totalling $ in relation to its derivatives business. In the event, it was four years before the first payments were made to these uncleared derivative creditors, and claims against Lehman’s are still ongoing. The contrast with Lehman’s cleared derivatives portfolio in CCPs is stark. Lehman Brothers UK subsidiary had a $ trillion cleared interest rate derivatives portfolio at LCH, comprising over 65,000 trades. In the period of extreme market turmoil following the firm’s collapse, it took three weeks, rather than four years, for LCH to hedge and close out the entire $ trillion position. It used only around a third of the collateral margin Lehman had deposited at the clearing house. LCH was only one example of the ability of CCPs to dampen the shock of a major credit counterparty failure.
31.05.2018  “Banks’ traditional funding sources: opportunities for capital markets” Keynote address at 50th ICMA Annual Conference Javier Alonso Deputy Governor  Good afternoon. I would like to thank ICMA for its kind invitation to take part in this special day: ICMA’s 50th Annual General Meeting and Conference. It is a pleasure to be here and to speak to such a large audience of professionals from such varied backgrounds, representing, among others, issuers, intermediaries, investors, capital market infrastructure providers, regulators and supervisors. Capital markets being at the heart of this event, and banks being at the heart of my day to day work, what I would like to do in this speech is to highlight some developments related to banks’ funding sources that I think may offer new opportunities for capital markets. I would also like to briefly touch upon Brexit, an event that is generating great uncertainty and for which careful preparation is required. All of it, from my perspective as Deputy Governor of the Banco de España and as member of the Supervisory Board of the Single Supervisory Mechanism, which explains why my speech will be focused on developments in the European Union. New opportunities Let me start with what appear to me to be promising developments for reactivation of the markets. Firstly, the renewed political commitment reached at the Euro Summit on 15 December 2017 to press ahead with improvements to euro area governance provides new opportunities to accelerate progress in areas where developments so far have been somewhat sluggish.

Fintech, as it is known, seems to be the next big thing. It’s true that, in continental Europe, fintechs still account for just a small share of the markets for banking, payment services and asset management. Still, over the past years, they have received a lot of attention and a lot of funds. Fintechs are on the rise. They have entered the markets, and they are competing with banks – at least in some parts of the value chain. The question is: where will this innovation take us? Is it the end of banking as we know it? Will it create new risks? As I said before, it is hard to guess how innovations will evolve and easy to get it wrong. That said, let us take a very brief look at some potential futures. Scenario one: banks might embrace the digital trend and team up with fintechs. For banks this would be one of the more benign outcomes. And it seems to be happening right now. Scenario two: fintechs might break up the value chain of banking. Banks would end up losing revenue, market share and direct contact with clients. The result might be a more fragmented market where some players operate outside the scope of regulation and supervision. Scenario three: banks might still end up being crowded out. At the same time, however, the fintechs could be swallowed up by big tech companies, such as Google, Amazon and Facebook. The market would become more concentrated, less competitive and less diversified.
The CBT will continue to take the necessary measures to contain the adverse effects of global financial turmoil on the domestic economy, provided that they do not conflict with the price stability objective. Prudent monetary policy is necessary but not sufficient to maintain the resilience of the economy in the face of the global crisis. Therefore, strengthening the commitment to fiscal discipline and the structural reform agenda is also critical to facilitate expectations management and to support the effectiveness of monetary policy decisions. In this respect, the commitment to the European Union accession process, and timely implementation of the structural reforms envisaged in the PreAccession Economic Program remain to be of the utmost importance. I would like to state that, with respect to macroeconomic stability and price stability, we closely monitor developments regarding structural reforms intended to enhance the quality of fiscal discipline and to ensure sustainability of productivity gains. Thank you very much for your attention. BIS Review 67/2009  19

We have Professor Dani Rodrik of Harvard University as our keynote speaker on the topic of “The Disappointments of Financial Globalization”, followed by five leading international researchers, namely Dr. Claes Berg, Sveriges Riksbank; Professor Raghuram Rajan, University of Chicago; Professor Jose Antonio Ocampo, Columbia University; Dr. Arvind Subramanian, the Peterson Institute for International Economics; and Dr. Robert McCauley, Bank for International Settlements who will be presenting their in-depth studies over the next two days on broad range of issues, a part of which I have barely begun to touch upon. This symposium will also be rounded up by a panel discussion on “Financial Globalization in Emerging Market Economies” which should provide an interesting discussion on the implication of financial globalization and the current financial crisis from an emerging market perspective. Ladies and Gentlemen, I would like to conclude by saying that the recent developments in financial markets around the world will stimulate considerable review and analysis in the months and years to come. Across the globe, legislatures, regulators, financial supervisors are already hard at work trying to distill the lessons to be drawn from this experience and their implications for future policies. For the private sector, banks, credit-rating agencies, and the investment community are also trying their best in coping and adapting to these developments. For central banks, the implementation of monetary policy will certainly become a more challenging task as a result of the current financial turmoil.
The Hong Kong SAR Government was facing a “double-play” by the predators – manipulation and profiteering in the money market and stock market through massive short-selling. It was a critical situation – not only were we confronted with a sharp fall in the stock market and great losses to shareholders, there were also systemic risks to our monetary system and financial markets. Classical economics does not differentiate between big and small markets and assumes that market prices will not be manipulated by just a few players. Reality, however, is different from theory. At that time, the market capitalisation of the Hong Kong stock market was only $ billion, a mere 3% of the New York stock exchange’s $ trillion. The predators were unable and hence did not choose to make their move on the big US markets, but were able to plunder Hong Kong’s mid-sized and open market with impunity. 5. However, on 14 August 1998, with the authorisation of the Hong Kong SAR Government and backed by the war chest of the Exchange Fund, the HKMA intervened in the stock and futures markets through market operation to counteract the double-play by international predators. When the market operation was completed by the end of August, the HKMA had used about $ billion to acquire a vast amount of Hong Kong stocks, propelling the HSI from the pre-operation level of 6,700 points to 7,800 points. 6.

The subprime mortgage crisis precipitated an avalanche that nearly buried many financial institutions with tremendous losses. Obviously, human greed was at play. But this was not a sufficient explanation. Human greed has always existed. Why then had the US financial market sleepwalked toward the brink of collapse? Whenever an asset or credit bubble forms, many bewildered market participants are often of the view that it will be different to previous bubbles, and that the market boom is well supported by fundamentals. “This time is different,” so they say. In my view, the main cause of the market failure and near meltdown of the market was the collective failure of the various “safety valves” that maintain the orderly operation of the market. They include the internal risk control functions of financial institutions, the external discipline imposed by regulators and the ratings assigned by international credit rating agencies (CRAs), etc. In fact, it’s worth noting that many of the subprime mortgage-backed securities and related credit derivatives rampant in the market at that time were assigned the highest AAA rating by the major CRAs. And, according to the general estimates of these agencies, the probability of default within a year for debt instruments with such a rating was near zero (0.000%); while the probability of default within five years was a mere 0.09%. Now, we all know that these CRAs were dead wrong. Many people, including professional and institutional investors, had a misplaced trust in these agencies and underestimated the risks involved. They learnt a painful lesson in 2008/09.
In the same vein, in order to contain household debt at prudent levels to prevent financial imbalances, a maximum credit-to-income ratio was imposed on credit card and personal loans. Let me now turn to the current financial crisis and discuss some lessons that are relevant to the issue of supervisory arrangement. If we look at the wide range of counties afflicted by the current turmoil, we immediately notice that financial sector problems happened in countries with either supervisory model. Notably, the US is well-known for its multiple agencies, whereas the UK has an integrated one. Yet both countries are currently faced with similar financial sector problems. One cannot help but think that there must be certain common supervisory weaknesses that led to the crisis, regardless of the supervisory arrangements. So perhaps the key question is not about the institutional form but rather about how to strength the regulatory framework to ensure financial stability. Of course, this is not an easy task, given the scale and the complexity of the problems that we are in right now. Several committees and working groups of various organizations, including the BIS, are working on a number of issues that have been identified as contributing to the crisis, such as the procyclical nature of supervisory and accounting rules and the inadequate focus on liquidity risk. I do not know whether there are efforts to try to identify common weaknesses of different institutional setup of supervision. But no doubt this is an area that more work will be needed.

I believe we need to have this new framework in place by 2010, as the current crisis is left behind, hopefully, and growth and stability are restored. As part of the work program already laid down in the G-20, critical points in the reform include the need to make regulatory capital more neutral over-the-cycle, by integrating the macro prudential framework into the required capital of individual institutions; the need to reach, with prudential regulation and supervision, all quarters of the financial industry; and the need to enhance transparency of financial instruments and markets. Thank you very much. 2  BIS Review 44/2009