samchain/econo-pairs-v1 huggingface dataset:
Under these circumstances, if asset price inflation is driven by excessive leveraging, in theory, asset prices might drop first in search for a new equilibrium, and then stabilise at that point. Subsequently, asset prices will resume rising alongside economic recovery and a rebound in people’s income. (2)  The second possibility is that quantitative easing produces the desired results. Asset prices go up, stimulating consumption, and employment improves significantly as a result. This buys time for the relevant authorities to carry out reforms to enhance productivity so that, ultimately, asset price increases will be supported by economic  4  BIS central bankers’ speeches  fundamentals. This is, of course, a very desirable scenario as global economy will return to its normal growth path. I surely hope that this will be what eventually happens. (3)  What bothers me however is the third possibility, under which the process of deleveraging is disrupted by quantitative easing, leading to sharp increases in asset prices in the first place. Yet, since such increases are not supported by economic fundamentals, any increase in wealth will be seen as transient. As a result, households are unwilling to increase spending and in the end, the real economy fails to rebound. If inflationary pressure builds up alongside asset price increases, central banks may consider exiting the market and raise interest rates. When economic performance, inflation or monetary policy falls short of market expectation, asset prices might drop sharply and remain volatile.

Asset markets supported by an artificially low interest rate environment rather than economic fundamentals will skew resources allocation in society from expanding the productive sectors to pursuit of asset price appreciation. Such a shift will easily lead to investment mismatch, thereby eroding medium to long term productivity growth as well as growth potential of the economy. In addition, the more sizable and prolonged quantitative easing becomes, the more difficult and riskier will be the exit plan. Central banks should realise that there is not much they can do. In order to solve the structural imbalances built up in the past two decades, we must get to the bottom of the problem. Ladies and Gentlemen, up until 2008, the industrialised countries and various emerging economies had been enjoying a golden period of development which lasted for two to three decades. Income levels and living standards continued to rise. Some academics call this a period of “Great Moderation”. However, no one is sure why life during this period was so easy. Some say that this is due to technological and financial innovation of modern society, the so-called “paradigm shift”. We should now be awakened to the reality that this golden period was probably underpinned by little more than excessive debts, and is in fact unsustainable. If the major industrialised countries will have to undergo deleveraging in the foreseeable future, how will the global economy evolve?
In this respect, if financially vulnerable firms are defined as those that are unable to regularly pay the interest on their financial debts out of ordinary and interest income, it is observed that the relative weight of debt associated with vulnerable firms has fallen continuously since 2013, down to levels in 2018 very similar to those recorded in 2008. At the same time, it is estimated that in a hypothetical adverse scenario in which corporate profits continue to decline (on a scale, for example, equivalent to half of the decline observed in the last crisis, between 2008 and 2012), the consequent increase in vulnerability would be comparatively less intense than that which would have occurred in 2008 in response to the same adverse shock, reflecting today’s lower level of corporate indebtedness. That said, some types of firms and sectors may still have a significant degree of vulnerability to the deterioration of the environment, according to the strength of their financial position and the nature of the possible shocks. 22/29  In the case of households, their indebtedness as a proportion of GDP has also declined very significantly, by 28 pp from the peak recorded in 2010. Accordingly, at 58.3% at present, it has now practically converged with the euro area figure. The latest data indicate that total household financing was practically steady in September, in year-on-year terms, with a slight deceleration since the start of the year. By component, we can see significant divergence between credit for consumer goods purchases and credit for house purchases.

The precise objective of policy - even within the confines of the concept of price stability - remains a political decision: there will always be those who argue for a somewhat higher or somewhat lower target, and the fact that the Government endorses a precise target rather than just the vaguer goal of “stability” certainly strengthens our hand by allowing us to concentrate upon our essentially technical task. I am bound to say that in practice it seems to me to be rather a second order issue anyway given the narrowness of the range of definitions of “stability” that would carry conviction with the public, including financial markets. The Act confers the responsibility for meeting the Government’s inflation target specifically on a newly created Monetary Policy Committee, comprising myself as Chairman, the two Deputy Governors, two Executive Directors appointed by the Governor after consultation with the Chancellor and four members appointed from outside the Bank by the Chancellor. The Governors are appointed as members of the Committee for their full five year (renewable) terms; the remaining members are appointed for three year terms which are also renewable. The Committee’s policy meetings are also attended by a senior Treasury Official in the capacity of an observer, who may participate in the discussion - essentially to inform the Committee of any relevant aspects of the Government’s wider economic policies and explain the Committee’s thinking to the Chancellor - but he may not express a view on the monetary policy decision or, of course, vote on that decision.
Thus, emerging market central banks must be prepared for policy contingencies ahead. At the core, monetary policy must continue to safeguard price stability, while taking into account concerns about economic growth and financial stability. The Bank of Thailand, on our part, will do our best to steer the Thai economy and financial system through the global turbulences, to ensure the continued well-being of the Thai people in years ahead. Thank you. BIS central bankers’ speeches  1

The move to increase the resources for money laundering and terrorism financing investigations by the domestic law enforcement agencies, which currently is the emerging trend, needs to be supported with swift actions from the FIU and prompt response from reporting institutions. Another is that, at the international level, Malaysia will continue to enhance multilateral and bilateral relationships. I am happy to inform that we have recently concluded an MoU with the National Bank of Cambodia, bringing the total number of MoUs signed to 18. We have and will continue to provide assistance to countries in the Asia/Pacific region. Second is to provide greater focus in enhancing the competency and capacity of key stakeholders, i.e., the analysts, law enforcement officers and compliance officers. Despite the unfavourable economic condition, human resources and capacity building remain as one of our top focus. We plan to roll out capacity building programmes for analysts and enforcement officers covering fundamental, intermediate and advance level training programmes. The Certified Financial Investigators Programme, or CFIP, i.e., our flagship basic programme for financial investigators has produced 83 investigators with knowledge on the Anti-Money Laundering and Anti-Terrorism Financing Act 2001, as well as financial investigation techniques. We are open to collaborate with our foreign counterparts to conduct advanced level workshops. The third area is to further improve the quality of analysis. High quality STRs underpins an effective mechanism as quality STRs provide valuable intelligence for investigations.
The composite output Purchasing Managers’ Index – which has a high correlation with growth in the euro area – remains above its long-term average and is close to six-year highs. Overall, survey data continue to point to growth in the quarters ahead. Moreover, Eurostat’s Economic Sentiment Indicator is near a ten-year high. The ongoing recovery has led to solid employment gains. The number of people employed in the euro area has increased by almost 7 million since hitting a trough in mid-2013. This means that all of the employment losses recorded during the crisis have been offset. Additionally, the unemployment rate is now at its lowest level in eight years and continues to decline, notwithstanding an increase in labour force participation. Employment growth, together with the gradual increase in employee compensation, supports households’ disposable income and is underpinning solid consumption dynamics. Robust consumer spending is driven by buoyant sentiment, favourable bank lending conditions and the notable progress achieved with respect to deleveraging. The investment outlook is also positive, supported not only by a need to modernise the capital stock after years of subdued investment and an improving outlook for profitability, but also by easy financing conditions as our policy measures have passed through financial markets to affect the borrowing conditions of businesses and their customers. Since the announcement of our policy measures in June 2014, bank lending rates for euro area non-financial corporations have fallen by around 120 basis points and those for households by around 100 basis points.

This is equivalent to 16% of the GDP of these economies, or nearly $ per citizen.2 But, this is only a lower bound of the cost of the crisis. If we also include the impact on GDP and the loss of production relative to its pre-crisis trend, the costs rise. This has been showed by several studies, including the one just mentioned by IMF economists, which estimates that banking crises that occurred between 1970 and 2000 are resulting in output losses of more than 20% on average if we look at all countries, and more than 30% of GDP in advanced economies.3 These results are in line with the BIS finding that the median discounted cumulative loss of output over the course of a crisis in the same period was about 19% of pre-crisis GDP.4 Now, the question of exactly how much regulation leads to the optimal outcome in terms of long-term growth is, of course, debatable. But let me underline that ambitious attempts have been made by the BIS, but also the OECD and others, to assess the net effect of recent regulatory reform measures, and the results generally point in one direction: that the net effect of reforms is positive. In addition, let me also underline that the Basel Committee has not been blind and deaf to the worries expressed by the industry about excessive regulation. Many adjustments have been made, not least when it comes to the new liquidity regulation.
Central banks of advanced economies have stated clearly that they will continue to apply the quantitative easing, as long as inflation remains below the target and unemployment remains high. Actually, the so-far solutions have been in forms never experienced before. In fact, they pose new challenges with regard to implementation and potential risk spillover effects projected in the long run. Under these circumstances, the Bank of Albania, considering the situation as rather complicated and after an intensive work, has succeeded in designing a full package of measures. They aim to boost credit and improve micro and macroeconomic balances of financing the economy, about which I will inform you in the following. Package of credit recovery The idea about the package that we are introducing today occurred last year, where we discussed, jointly with you and representatives of the Ministry of Justice, about legal amendments needed to promote collateral execution. Since that meeting, our experts have worked intensively for enriching it and bringing it to today’s form. The package consists in three pillars: legal pillar; monetary policy pillar and prudential pillar. I will dwell on them in the following: 1 – Legal pillar The rapidly increased non-performing loans in the recent years, reflects, inter alia, a number of known and unknown problems of collateral execution. Therefore, together with the banking industry, we have identified and made relevant proposals for a higher efficiency of the collateral execution process.

In consultation with other important stakeholders in this  BIS central bankers’ speeches  3  process, legal amendments to the Civil Procedures Code and to the Civil Code have been drafted. These amendments aim to accelerate the obligatory collateral execution, avoiding procedural delays caused by bank debtors. More specifically, the proposed amendments address the following: •  Courts do not take measures to secure charges/sues, when the bailiff actions are rejected;  •  Courts do not take measures to secure charges and do not suspend the execution of collateral, when the debtor requests the invalidity of the executive title, arising from a bank credit;  •  Reduction by 50% of the initial price of the immovable property, placing an acceptable average for the debtor and the bank, and making clearer the value (price) of the item with which the second auction begins. We are informed by the Ministry of Justice that these amendments are in process of finalisation and this legal package will be sent for approval to the Council of Ministers and then to the Parliament of Albania. I take this opportunity to iterate the need for these legal proposals to be approved by the Assembly of Albania at an earlier time possible. Improvements in the legal framework and collateral execution practice would provide public authorities with new spaces to boost lending in Albania. 2 – Monetary policy pillar I mentioned earlier that Bank of Albania’s monetary policy has been easing recently, undertaking 6 consecutive key interest rate cuts.
That analysis should lead to an assessment of the risks to the world economy as a whole. The second task is to encourage countries to abide by their commitments to each other by promoting greater transparency about national policies. In agreeing the Second Amendment of the Fund’s Articles, all member countries made a general commitment to each other to pursue policies consistent with the objectives of stable global growth and low inflation. Only in relation to exchange rate arrangements were members asked to specify what framework they would follow to be consistent with this commitment. As Tim Adams, Under Secretary for International Affairs at the US Treasury, has noted recently, the nature of those commitments was left unhelpfully vague and should be clarified. In doing this, we should not lose sight of the fact that the policies of all significant members have spillover effects and all should be required to be more precise about their policy making frameworks. Clarity about the objectives of policy of member countries should make it easier for all countries to formulate their own policy. And by making their national policy frameworks sufficiently transparent, countries will be making it possible for the IMF to hold them to account and to fulfil its role as an umpire. The third task is the provision of a forum for national authorities to discuss risks to the world economy.

The Fund should be a forum in which countries can discuss these risks. It should also hold countries to account. In these ways, it can indirectly support global monetary stability. With countries naturally reluctant to cede any control over their own monetary and fiscal policies, it is likely that the IMF will have as instruments only the powers of analysis, persuasion, and, in Keynes’ own favourite words, “ruthless truth-telling”. That phrase does not conjure up many memories of any of the many international meetings I have attended. But unless the IMF has the self-confidence to play  4  BIS Review 11/2006  that role, its deliberations and statements will carry little weight. The Fund requires an independent, respected and clear voice. The Fund should focus its work on the international monetary system around three tasks. First, it should provide and share information about the balance sheets of all major countries, their composition and size, and the links between them. The Fund has been in the forefront of the analysis of balance sheets for emerging market economies, and it needs to extend this approach to its surveillance of the industrialised world. In conducting this analysis, the Fund must look at countries’ exchange rate choices. But no one price is a sufficient statistic for the effect of one country’s policies on the rest of the world - even one as important as the exchange rate. Balance sheet analysis should be at the heart of the surveillance process.
BIS central bankers’ speeches  9  Chart 1  Chart 2  Sources: Datastream, SNB  10  BIS central bankers’ speeches  Chart 3  Sources: OECD, Riksbank, SNB, Statistics Denmark, Statistics Sweden  Chart 4  Sources: CNB, Danmarks Nationalbank, ECB, Riksbank, SNB  BIS central bankers’ speeches  11  Chart 5  Sources: Eurostat, SNB  Chart 6  Sources: CNB, Danmarks Nationalbank, ECB, Riksbank, SNB  12  BIS central bankers’ speeches  Chart 7  Sources: Bloomberg, SNB  Chart 8  Sources: Eurostat, SNB  BIS central bankers’ speeches  13  Chart 9  Sources: Eurostat, SNB  Chart 10  Sources: Eurostat, SNB  14  BIS central bankers’ speeches  Chart 11  Sources: Eurostat, SNB  Chart 12  Sources: CNB, Danmarks Nationalbank, ECB, Riksbank, SNB  BIS central bankers’ speeches  15  Chart 13  Sources: OECD, Riksbank, SNB, Statistics Denmark, Statistics Sweden  Chart 14  Sources: BIS, SNB  16  BIS central bankers’ speeches  Chart 15  Sources: Bloomberg, Danmarks Nationalbank, Riksbank, SNB  Chart 16  Sources: Bloomberg, Danmarks Nationalbank, Riksbank, SNB  BIS central bankers’ speeches  17  Chart 17  Sources: Datastream, SNB  18  BIS central bankers’ speeches

For the offshore industry in Labuan, which has benefitted significantly from Labuan since its inception, it is time to give back. 1/4  BIS central bankers' speeches  There are various ways in which the industry can assist the local population, such as innovative and creatively designed technical and industrial training that can assist in uplifting the job prospects of local talents. For example, fit-for-work programmes that leverage on online courses to complement industry supported training programmes and on-the-job training will improve the job fit of the workforce. Needless to say, strong commitment by industry captains to grant similar opportunities, apprenticeship and fit-for-work schemes will surely hasten the upskilling of the locals. The industry ought to come together to devise a scheme that give opportunities to locals to get good jobs. As we move forward, we need to be more focused on the outcomes we want for Labuan. We want a more balanced growth. A clear step forward is to formulate clear and measurable targets, and to review them consistently. The primary performance indicators that should be applied must cover aspects such as; contribution towards Malaysia’s and Labuan’s GDP, quality of job creation, training and development for the local population, investment in infrastructure, access to financing by local SMEs. We must ensure that the benefits we obtain outweigh the incentives given by the government such as the revenues foregone from the notional tax incentives offered. The old adage – “You can’t manage what you don’t measure” – captures the essence of this idea.
To counter this risk SWIFT, the telecommunications firm, is developing a product – known as the Market Infrastructure Resiliency Service (MIRS) – that will act as virtual third site for the Bank on an independent IT platform. Moreover, because SWIFT would operate MIRS from one of its European operating centres, it would not be affected by IT failure affecting both of our locations, increasing the degree of latency that MIRS will offer compared to a traditional model for a third site. MIRS will be available from January 2014, and we are the first central bank to take advantage of it. The Bank’s costs in relation to this project have been funded by the CHAPS member banks, who will benefit from the additional resilience MIRS will provide. 2  BIS central bankers’ speeches  Turning to the lesson that ‘liquidity matters’, we introduced a Liquidity Saving Mechanism (LSM) in April this year. There are some technical similarities to the Canadian “Jumbo algorithm”, which periodically looks to offset high-value (“Jumbo”) payments in bilateral queues, speeding up their settlement and reducing collateral requirements. The LSM in our RTGS system is an offsetting mechanism that seeks to match groups of payments, regardless of size, via bilateral and multilateral algorithms that run in short cycles around 275 times each day. All the payments matched by the algorithms will settle individually and simultaneously at the conclusion of the matching cycle.

This global resolve is in congruence with the role and relevance of Islamic finance on the global economic environment in this post-crisis era. While the amount of funds managed in the Islamic financial system is still only a fraction of the total assets of the international financial system, it represents that portion of financial activities that is truly supported by underlying productive capacity that connects with the real economy. Despite the unprecedented disruptions in the international financial system, studies show that the Islamic financial industry has weathered the global financial crisis relatively well. The financial crisis has thus brought about a greater appreciation amongst the international financial community on the distinct nature and in-built strengths of Islamic finance. Based on the Shariah requirement that Islamic financial transactions needs to be supported by an underlying economic activity, its expansion contributes to income and wealth creation. In addition, the profit sharing and risk sharing characteristics in Islamic finance strengthen the incentives for the financial institutions to ensure the profits are commensurate with the risks being assumed. It is this form of finance that we would want to encourage. With this underlying foundations, efforts are being directed to build the domestic financial infrastructure. A challenge that is being specifically addressed is the development of an active secondary global sukuk market. In this regard, there has been a lack of trading in the secondary market especially in the USD sukuk market as the investors tend to buy-and-hold the instruments until maturity.