samchain/econo-pairs-v1 huggingface dataset:
Here a particular effort should be made to explain all the decisions adopted by the different levels of government in Spain that have been well-received and valued by the markets, such as structural reforms, pension reform and the recent Organic Law on Budgetary Stability, among others. There should likewise be a common effort, in the interest of all sectors of the Spanish economy, to disseminate and address in depth the additional measures that should shortly be adopted to tackle the crisis. There is no more important or pressing task in the short term than to restore lost confidence. And here, collaboration is called for by politicians and economic and social agents in positions of responsibility, and by all institutions with economic policymaking responsibilities. BIS central bankers’ speeches  5  A fundamental determinant of confidence is the credibility of regulatory and supervisory institutions, based on their ability to exercise their powers professionally and independently. This is always an essential element of a country’s economic reputation, but all the more so when confidence has been called into question and the recovery in growth depends on the external financing of its economy. Adam Smith observed in his famous work that the wealth of nations was then closely related to how open their trade was. And today we can see how the richest and most democratically sound countries in the world are those that have competent and independent regulatory and supervisory agencies that act as a counterweight to governments potentially succumbing to interventionist temptations.

Following the approval of the RDL, the banks and the authorities focused on ensuring compliance with this legislation, and on pursuing bank integration processes and on implementing the business model changes arising from the amended regulations governing savings banks. Under the provisions of the RDL, 13 banks had to increase their capital by more than € billion, meaning that in the second stress test conducted by the European Banking Authority, further capital increases were not needed. However, as the crisis worsened and spread in summer 2011, the Community authorities demanded a temporary increase in the capital requirements of large banks and the creation of a temporary extraordinary buffer associated with potential sovereign debt portfolio losses. These new requirements were applied to the five largest Spanish banks, for which additional capital needs of somewhat over € billion were calculated. 4  BIS central bankers’ speeches  As a result of all these developments, there was significant progress in the clean-up and restructuring of the Spanish banking system. From the onset of the crisis to the beginning of this year, provisions of around 13% of GDP were set aside, banks shored up their solvency by significantly increasing their capital, most savings banks converted into banks and around 30 institutions disappeared, with their management passing in most cases to other sounder and more efficient banks.
The good news is that since the crisis broke, banks in the UK and elsewhere have made significant progress in rebuilding capital. Evidence to support this is that at its last meeting in June, the Bank’s Financial Policy Committee decided to close its recommendation of March last year that the largest UK banks and building societies should meet a minimum 7% Common Equity Tier One ratio on the socalled end-point (ie full implementation) basis set out in the EU rules to implement Basel III, after taking into account adjustments for expected loss on more vulnerable loan portfolios, the impact of future conduct of business costs, and prudent use of risk weights. Since then the actions taken by a number of major UK banks and building societies have put them on course or ahead of the planned actions to meet the FPC’s test. In a few cases, there are more actions to be undertaken in their plans, but overall this is a welcome story of action taken to strengthen capital positions. I do however accept that there remains a perception in some quarters that higher capital standards are bad for lending and thus for a sustained economic recovery. I agree with those who argue that banks have a lot more to do to demonstrate that they support lending to small businesses. Interestingly, in recent weeks the messages I have seen from the Bank of  4  Bank calculations based on supervisory data.

Switzerland is a good example of this: thanks to the inclusion of the major political players in government responsibilities, and to the extension of direct democracy processes even to financial matters, a deeply rooted culture of stability has developed. It is this which provides the foundation for the stabilising effect of the well designed and constitutionally anchored debt brake. This has made a decisive contribution to ensuring that federal government finances are in good shape despite the financial and economic crisis. As a general rule, any efforts to establish a sustainable fiscal policy in countries with debt problems can ultimately only bear fruit if they succeed in fostering a broad-based culture of stability. BIS central bankers’ speeches  1
In the light of this, it is not surprising that criticism of the Riksbank’s approach was strong at times. The discussion on making the Riksbank more independent aroused strong feelings not least among many social-democrats and in parts of the trade union movement. There are obviously different views of the extent to which it is necessary with such a stringent monetary policy during the years of adaptation. We can never obtain an answer to this but we can at any rate note that we now seem to have achieved the stable prices we aimed at. To date, it is too early to say whether price stability can be combined with as high employment as previously, but what we are now seeing gives rise to optimism. Price stability requires some independence for the Riksbank The strong pessimism on the future prospects for the Swedish economy that affected the general mood after the crisis in 1992 has then in recent years been transformed into an equally strong optimism! We can now draw the conclusion that the pessimism was exaggerated but we know nothing yet about the situation with respect to today’s optimism. It would seem to be a fact that there has been over-optimism about developments in certain IT-related industries, although the question is how we should regard the more long-term growth of the Swedish economy. Many structural reforms have been carried out. The financial markets have been deregulated, competition on the goods markets has also increased and many state monopolies have been abolished.

As a creature of the G10, the Committee could originally lay claim to coverage of most of the world’s truly internationally active banks. But as banks and financial markets became increasingly integrated across national borders, this claim to be the standard setter for all internationally active banks became more and more difficult to justify. During the 1990s and 2000s, the Committee made good use of its Core Principles Liaison Group to seek advice from members outside the G10. The CPLG’s contribution was highly  2  BIS central bankers’ speeches  constructive when Basel II was developed, for example. But as the size and importance of jurisdictions “outside the tent” grew, even this arrangement became increasingly untenable. And so, in 2009, the Committee essentially stepped up from a G10 to a G20 foundation as it sought a truly coordinated response to the global financial crisis. Indeed, we now have more than 40 organisations representing 27 member jurisdictions around the table. As a result, the Committee’s coverage of global banking assets has gone from about 60% to 90%. This much greater inclusiveness lends, in turn, greater legitimacy and credibility to the Committee’s standards, as they are now set by a process that is truly reflective of international markets. The fourth key influence is a more recent one – the shift in thinking from a micro- to a macroprudential perspective. For much of its life, the Committee focused primarily on microprudential issues.
In the past five years, significant and comprehensive reform of our commercial banking system has been achieved, with financial stability being restored; corporate governance, strengthened; competition within domestic banking system enhanced with the entrance of new competitors. At the same time, new financial services such as E-banking and other innovative instruments such as smart cards are on the offer to customers giving them more choices of financial services with greater qualities. We are therefore at this point ready to move forward to the next step – to articulate our vision for the future of commercial banking and financial services in Thailand, taking into consideration powerful forces from the rapidly globalized international financial markets and the emerging financial landscapes within the region. BIS Review 8/2002  1  Ladies and Gentlemen The new financial sector master plan must be realistic and address the fundamental problems that we have. I see no role for the plan to strive to be a financial center or to develop the financial sector for its own sake. Thailand has a dual economic structure, with the modern industrial sector overlaying with the more traditional sectors outside Bangkok which employed more than half of our population. Thus, we should concentrate on improving the efficiency and stability of our domestic financial institutions to best serve our real sector.

There is generally a tendency towards concentration in infrastructure provision because of increasing returns to scale in a fixed cost business and often powerful network effects. This applies equally in the case of commercial bank provision of infrastructure: ECB survey evidence reveals that the ten largest correspondent banks in euro account for around 80% of correspondent banking payment values; and the top-4 global custodians now account for three-quarters of total assets in custody. Indeed, regulators have been giving increasing attention to the potential systemic spillovers from operational or business failures at major commercial bank providers of infrastructural services. That has led, for example, to the initiative in the US to implement “New Bank”, a dormant shell company to take over the functions should one of the two major clearers in the US Treasury market cease operations. 34 It may be that a competitive environment can be sustained, particularly as the cost of technology falls, lowering barriers to entry, and liquidity bridges and other forms of interoperability are established between systems. But, the jury is still out. Recent evidence on the trading side, particularly in the US, is mixed: some trading platforms, such as Archipelago and INET, have been swallowed up by the incumbent exchanges; others, such as BATS Trading are thriving, keeping the pressure on the exchanges to cut costs and upgrade their services. 35 I suspect what we are seeing is a redefinition of the market on an international scale.
Why macroprudential policy The conventional thinking pre-crisis was based on two assumptions: •  First, asset prices did not matter much. Central banks therefore focused on consumer prices and placed less emphasis on asset prices. •  Second, if risks in individual financial institutions were well controlled, the financial system as a whole would generally be safe. Regulators therefore focused on the safety and soundness of individual institutions and paid less heed to systemic risk. The collapse of the real estate markets in America and Europe, the breakout of the Global Financial Crisis, and the contagion of risk to seemingly sound financial institutions – against a backdrop of relative macroeconomic stability – showed both assumptions to be wrong. Thus was born macroprudential policy – which focused on the health of the financial system as a whole and its interactions with the macroeconomy, particularly developments in liquidity, leverage, and asset markets. In many emerging market economies, macroprudential policy has become an important complement to monetary policy to help secure economic and financial stability. In Singapore, the focus of macroprudential policy has been to promote sustainable asset prices. Asset prices matter for four reasons. First, volatile asset prices pose a risk to financial stability, especially when a run-up in asset prices is financed by easy credit and accompanied by a build-up in leverage in the economy. When asset prices correct, financial institutions’ vulnerability to default and loss increases. Second, asset price inflation is as distortionary as consumer price inflation.

Buyers were limited to borrowing only 50–60% of the total purchase price of the car. Loans had to be repaid within five years. COE premiums for cars have adjusted downwards by about 25%. Macroprudential policy in Singapore is still work-in-progress, as is the case elsewhere. The measures have achieved some degree of success in the property and car markets but it is too early to declare victory. As with traditional macroeconomic policy, these macroprudential measures will be recalibrated as market conditions change. There are many unknowns in the theory and practice of macroprudential policy. We need to better understand the transmission mechanisms through which our various measures operate, their inter-relationships with one another, and unintended consequences or distortions they may create. The field is ripe for further research and, I hope, will challenge the intellectual curiosity of scholars, such as those assembled here this evening. In fact, the ABFER can play a very important role in this regard. Policymakers all over the world, including us here at the MAS, have been thrust into a vastly different environment. We need to update existing policy paradigms and even develop new ones. It is my hope that the collaborative network created by the ABFER will help foster a vibrant research culture and provide thought leadership on the important policy debates confronting this part of the world. MAS is happy to sponsor and support the ABFER. Conclusion Let me summarise my main points.
This is also evident in the KfW-ifo-Mittelstandsbarometer. Germany is an open and integrated economy, so it is not surprising that a slowdown in the rest of the euro area has an impact here. Intra-euro area trade amounts to around 40% of  BIS central bankers’ speeches  1  German GDP. And around 65% of foreign direct investment in Germany comes from other euro area countries. But it is less often noted how problems in the wider euro area affect the financial situation in Germany. It is the weak euro area economy that is keeping interest rates here at very low levels. And it is the crisis of confidence in some euro area countries that is causing safehaven flows of money into Germany, depressing interest rates even further. This highlights the fact that countries in a single currency area are connected like communicating vessels. A change in one vessel creates an equal change in all the others. As interest rates rise in countries in difficulty, they fall in strong countries like Germany. As TARGET2 liabilities increase in some countries due to capital outflows, TARGET2 claims increase in Germany due to capital inflows. Financial developments in Germany are the mirror-image of financial developments in the rest of the euro area. And this means that measures to ensure the stability of the euro area as a whole will also be to the benefit of Germany. So let me now turn to the actions being taken by governments to achieve that goal of stability.

Financial union is essential in a single currency area where cross-border capital flows can lead to credit booms and other imbalances – and where the negative effects of a bust can spread rapidly to other members. One essential part of financial union is a single banking supervisor. As you know, the European Commission has recently proposed that the new supervisor should be based at the ECB. This is important to ensure consistency across the euro area and to prevent regulatory capture. Day-to-day tasks, however, would remain with national supervisors who have the competence and resources to implement them. But financial union does not have to imply the pooling of deposit guarantee schemes, an issue that I know is of concern in this country. Organising and funding deposit guarantee schemes can remain a national responsibility, with comparable effectiveness. In the longer term, all four pillars are equally important. They are the bedrock for the enormous potential of the single currency for Europe’s citizens. Completing economic and monetary union would give citizens greater security against any future crisis. It would create the foundations for sustainable growth and employment. For all citizens of the euro area, it is therefore essential that Europe’s leaders stay on course. Thank you for your attention. BIS central bankers’ speeches  5
Once employees are on board, performance management should play a greater role, both in compensation decision-making, which needs to be simplified and diversified, and in the promotion process. The process should reflect a better balance between production and controls, by focusing not on “what” was accomplished but “how” it was accomplished. Repercussions are necessary for employees that do not behave in a manner that is desirable. I said that leadership must come from the top. But that doesn’t mean that you can’t drive the culture from throughout the organization in the form of “culture carriers” – employees who are well connected, respected and can be effective in making your culture “go viral.” Cultural change is not just a “flavor of the month.” It is a long-term commitment to changing a firm and an industry. It will take time. And, once you feel you’ve achieved what you originally set out to achieve, you will likely have raised the bar and will need to reset your goals. Building and maintaining a strong culture in a firm is an ongoing effort, not a “one and done” initiative. 8  BIS central bankers’ speeches  Conclusion Will our list of “to dos” ever end? Probably not. Will our list of “worries” get shorter? Unlikely in the current environment. We live in an ever-changing environment where speed and agility are of the essence. Demands from customers change, expectations from shareholders change, and the regulatory landscape you work within will continue to evolve to keep pace.

Then we will conclude with a panel on the recent global financial turmoil and its policy implications. Once again I extend my warm welcome to all participants. I also want to thank the distinguished participants for their valuable contributions. I hope you enjoy both the conference and your stay in Istanbul. Thank you. BIS Review 144/2008  3
Thomas J Jordan: Financial Stability Report – potential risks and actions Introductory remarks by Mr Thomas J Jordan, Vice Chairman of the Governing Board of the Swiss National Bank, at the half-yearly media news conference, Berne, 16 June 2011. *  *  *  In my introductory remarks today, I would like to present the most important points from our recently published Financial Stability Report, in which we consider potential risks to financial stability and identify where action may be needed. General economic and financial conditions for the Swiss banking sector improved further in 2010. Overall, global economic growth was stronger than expected last year, despite the expiry of fiscal stimuli. In Switzerland, too, economic development was robust and growth was high in an international comparison. Against this background, the profitability and capital situation of both big banks improved further, and remained good for banks with a domestic focus. However, the economic environment remains fragile, and a renewed, sharp deterioration over the next twelve months cannot be ruled out. In the short term, the prevailing uncertainty primarily affects the two big banks, which are still exposed to considerable credit and market risk relative to their loss-absorbing capital. For domestically focused banks, by contrast, the risks are largely of a medium-term nature, and are related to potential adverse developments on the Swiss real estate and mortgage markets. In view of these risks, all Swiss banks should ensure that they have a broad and high-quality base of loss-absorbing capital.

The picture is not as bright as last spring At the time of my previous meeting with the Committee, our discussion was coloured by some relief that the effects of the terrorist attacks on 11 September 2001 had not had a particularly marked impact on the world economy. The uncertainty among firms and households had subsided to some extent and there were signs that economic activity abroad was beginning to improve. An optimistic mood was spreading. Order books seemed to have stabilised and in some cases had even taken a turn for the better. Moreover, an expansionary economic policy in many countries was expected to provide an additional stimulus. At the same time, I pointed out that we could not be entirely certain that world economic activity would pick up. Among other things I mentioned that the economic imbalances in the United States were still large and stock market valuations were high. So there were a number of questions as to whether demand would in fact rise on a broad front. Last spring, the moderate economic slowdown in Sweden had meant that inflation here remained high and resource utilisation was still tight. GDP growth seemed to have bottomed out during the summer of 2001. Unemployment had stopped falling. Inflation had been noticeably above the Riksbank’s 2 per cent target for a time. This was partly because so-called supply shocks had raised the price level and led to temporarily higher inflation.
William C Dudley: The economic and fiscal challenges facing Europe Testimony by Mr William C Dudley, President and Chief Executive Officer of the Federal Reserve Bank of New York, before the Subcommittee on Domestic Monetary Policy and Technology, Committee on Financial Services, United States House of Representatives, Washington DC, 27 March 2012. *  *  *  Introduction Chairman Paul, Ranking Member Clay, and members of the Subcommittee, my name is Bill Dudley, and I am President of the Federal Reserve Bank of New York. It is an honor to testify today about the economic and fiscal challenges facing Europe, and the Federal Reserve’s efforts to support financial stability in the United States. Financial stability enables U.S. businesses and households to maintain their access to credit and ensures sustained economic growth. This is why promoting financial stability is an important objective of the Federal Reserve, and other central banks around the world. Let me preface these remarks by stating that the views expressed in my written and oral testimony are solely my own and do not represent official views of the Federal Reserve Board, the Federal Open Market Committee (FOMC) or any other part of the Federal Reserve System. Additionally, because I am precluded by law from discussing confidential supervisory information, I will not be able to speak about the financial condition or regulatory treatment or rating of any individual financial institution.

At this time, although I do not anticipate further efforts by the Federal Reserve to address the potential spillover effects of Europe on the United States, we will continue to monitor the situation closely. Thank you for your invitation to testify today, and I look forward to answering your questions. BIS central bankers’ speeches  3