samchain/econo-pairs-v1 huggingface dataset:
With these two questions in mind, we will also explore the consequences of financial crises on unemployment, household credit, and the real economy, and will try to understand how markets operate in environments with multidimensional private information. Our last session will be devoted to analyzing the effects of unconventional policies in dealing with the impact of the recent financial crisis in Chile. I am confident that valuable lessons will come out of these two days of discussion. To begin, I would like to share my views and Chile’s experience in four issues that are currently in the policy debate and that will underlie the discussion we will be having over the next two days. The first issue relates to the debate on financial stability as a macro policy goal and which institutions should be responsible for it. I will then turn to the availability and usefulness of policy instruments to pursue financial stability. I will also refer to two aspects of our experience in conducting monetary policy during financial crises: our experience with unconventional policies during the recent global financial crisis and our experience with financial rescues in our own financial disaster in the early 1980s. In the latter case, I will also touch briefly on the impact of rescues on the Central Bank´s balance sheet. 1. Financial stability as a policy goal. The role of the central bank  The recent financial crisis challenged the paradigm that the stability of the financial system could be preserved through a combination of micro regulation and macroeconomic stability.

The financial soundness of a central bank, the usual lender of last resort in a country, is an important firewall for trouble in the financial system. While a central bank may count with the help of the sovereign, this channel may be a source of concern when sovereign themselves are facing problems, and it also raises some worries about the ability of the central bank to maintain its independence. There are also those who argue that, since the liabilities of central banks can be arbitrarily created, the financial position of a central bank shouldn’t matter. But this argument forgets that doing so may endanger the achievement of the inflation targets that many central banks have taken as their operational goals, affecting their reputation and independence. 2  4  Céspedes et al. 2012. BIS central bankers’ speeches  In 1982, as the debt crisis spread through Latin America, the Chilean financial system, which had channeled substantial foreign-currency-denominated syndicated loans, became largely insolvent. Under these conditions, the government engineered a massive rescue operation through the central bank where several of the most important banks became nationalized and others disappeared, after their assets were absorbed by other institutions. This intervention prevented an even larger collapse of activity than the one we ended up experiencing. The manner in which it was implemented, where shareholder equity was fully diluted and institutions assumed a subordinated debt to the central bank that took a long time to repay, helped maintain the rescue’s moral hazard concerns at bay.
It is necessary that the people affected by them receive support to enable them to make a living in other industries and in other regions. However, despite the difficulties experienced by some people, these changes have on the whole led to improvements. A lot of work remains to be done to liberalise world trade, which is indicated by the fact that the potential increases in wealth from continued liberalisation are substantial. Calculations made by the World Bank indicate that welfare gains of between USD 400 and 900 billion could be made if all of the current trade barriers were removed. More than half of these gains would fall to poor countries. The agricultural and pharmaceutical industries, where the poorest countries have their largest comparative advantages, would account for 70 per cent of the profits, that is to say, USD 230 billion. For comparison purposes, it can be mentioned that total foreign aid amounts to USD 60 billion a year, while the OECD countries’ total agricultural subsidies are USD 330 billion a year. Increased trade liberalisation is therefore a better means of achieving wealth than foreign aid could ever be, because, to paraphrase the Chinese proverb, “if you give your friend a fish you will feed him for a day, but if you allow him to fish he will be able to feed himself for a lifetime”.

I would thus like to share with you now some thoughts on the nature of these challenges and the contribution that central banks can make to address them effectively. 1.The digitisation of the economy and its challenges for sovereignty A- The digitisation of the economy has led to a profound change in financial ecosystems. The development of an Internet-based network economy has provided businesses with more direct access to consumers, while reducing the fixed costs of launching and operating services This change has gone hand in hand with changing lifestyles and increased expectations in terms of simplicity, availability, immediacy and even personalisation of services. This is commonly referred to as the “customer experience". The emergence of digital banks, where interaction with the customer is mainly carried out via a mobile application, is an example of a response to this new standard in terms of practices. Changing patterns in practices have also prompted some companies to position themselves between customers and traditional service providers in very specific segments in order to offer value-added services. This “re-intermediation” has given rise in Europe to a continuous adaptation of regulations in order to regulate and secure data sharing, which is the driving force behind open banking. This trend benefits both relatively small players (FinTechs) and technology giants whose business model is based on the monetisation of data (Gafams and BATX, whose entry into the European market is more recent). These changes are the natural result of a process of creative iteration, and promise to simplify practices by diversifying them.
Privatization initiatives noted earlier will also require investment of tens of billion of riyals. In addition, the maintenance and expansion of infrastructure in the various sectors will require significant pools of capital. A rough estimate of the financing needs of the projects announced so far by the Government over the next 10 years exceeds USD 500 billion. However, the way that these financing needs are met by the Banks and capital markets in future is likely to be different. First, these projects and initiatives will require longer term financing which will be difficult to finance through traditional bank loans. Second, it will require a mixture of equity and debt obligations. Third, the funding could be multi-currency  4  BIS Review 85/2007  and attract multinational institutions and investors. Fourth, it could take form of various types of capital instruments, not yet seen in the Saudi and regional capital market including corporate bonds, debentures, mortgages, subordinated loans, preferred shares, etc. Also, there will be an opportunity to raise funds through Islamic finance instruments such as Sukuks and Ijara. It is no doubt that the financing needs of Saudi Arabia will require a collaborative effort by Saudi authorities, Saudi banks, and the regional and international banks. It will also requiring tapping various investors through the domestic and regional capital markets. Each will have an important role to play in this process.

To do that, trust should be rebuilt between the countries of Europe. Trust is vital. From a French perspective, how can that trust be re-created? By carrying out reforms, and France is doing that. And by reducing deficits even more? By continuing to reduce the deficit so that debt falls and France is ready when growth slows down. And by making further cuts in public spending? It is not for the ECB to tell the French government what needs to be done in detail, but what we wish is for France to have the capacity to respond economically when growth slows down and for it not to depend completely on monetary policy. 2/2  BIS central bankers' speeches
Deposit rates dropped significantly at maturities of one year or more, while the rates on our instruments at terms of two or more years, also fell after the announcements. One issue that has been on the table, not only in Chile but in the developed world and a number of emerging economies as well, is precisely the behavior of longer-term interest rates. Unlike those at very short term, which are largely arbitraged by the monetary policy stance, interest rates on long term government bonds are more influenced by, among other factors, the appetite for risk, the evolution of interest rates around the world and the widespread uncertainty prevailing in the economy. This last point is connected with expectations for long-term inflation and growth and fiscal solvency prospects, with particular strength in those economies that have had to embark in costly financial packages and bank bail-out programs, thereby multiplying their levels of public debt. In some emerging economies, and even in some developed ones, this increased debt has spurred doubts about the sustainability of their fiscal accounts and monetary arrangements, questioning their capacity to grow in the coming years. Although luckily, and thanks to the efforts made, the Chilean economy is not in such a situation, the determination of the long-term interest rates does depend indisputably not only on the prospects for growth and inflation – and thus on monetary policy – but also on portfolio decisions of domestic agents and the appetite for risk. Developments early this year are very illustrative.

Ida Wolden Bache: Central bank digital currency and real-time payments Speech by Ms Ida Wolden Bache, Deputy Governor of Norges Bank (Central Bank of Norway), at Finance Norway's Payments Conference, 5 November 2020. * * * Accompanying charts can be found on the website. Please note that the text below may differ from the actual address. Introduction Chart 1 Changing payment landscape Thank you for the invitation to speak here today. For anyone interested in payment systems, this conference is an important meeting place – and that applies equally to this year’s conference, with its many digital participants. The payments landscape in Norway is changing. Technological advances, user preferences and globalisation are strong driving forces for change, offering opportunities but also posing challenges: How can we ensure the existence of an efficient system for payments in NOK while at the same time safeguarding security? How can we improve the common infrastructure for payment services? How can we best promote competition and innovation? The private sector, organisations and authorities must together and individually work to further develop the payment system. Norges Bank is responsible for promoting an efficient and secure payment system. This is why we are now assessing whether there is a need for central bank digital currency and whether Norges Bank should expand its operational role in real-time payment settlement. This is the theme of my remarks here today. A changing payments landscape Changes in payment patterns have accelerated during the Covid-19 pandemic.
Speech  Embargo 19 September 2019, 5.30 pm  Fourth Karl Brunner Distinguished Lecture Introduction of Raghuram Rajan, ETH Zurich  Thomas J. Jordan Chairman of the Governing Board Swiss National Bank Zurich, 19 September 2019 © Swiss National Bank, Zurich, 2019  Page 1/4  Ladies and gentlemen I am very pleased to welcome you all to this year’s Karl Brunner Distinguished Lecture. This occasion marks the 30th anniversary of Karl Brunner’s death. In the Karl Brunner Lecture Series, the Swiss National Bank pays tribute to academics whose research is of particular relevance for central banking. Today we are celebrating the outstanding contribution made by Raghuram Rajan, the Katherine Dusak Miller Distinguished Service Professor of Finance at the Booth School of Business at the University of Chicago. We are honoured that Dr Rajan has accepted our invitation to deliver this lecture. Raghuram Rajan was born on 3 February 1963 in Bhopal, India. He started his career with a bachelor’s degree in electrical engineering from the Indian Institute of Technology Delhi. Following the decision to leave the sphere of electromagnetic fields and waves in favour of the oscillations of the economy and financial markets, Raghu joined the doctoral programme at the Massachusetts Institute of Technology (MIT), where he received a PhD for his thesis ʻEssays on Banking’. Four years later, at the age of just 32, he became a full professor of finance at the University of Chicago. Exceptional academic Raghu is an exceptional academic.

So there is a ground. We may asses that the shareholder in Slovenia is currently in unfavorable condition and is unable to financially support the bank in Macedonia. Not only financially, but also from a functional point of view. We have not yet made that assessment, but we could. It is an argument that we could use at any time if the shareholders from Slovenia do not perceive the situation here realistically and do not take the right decisions for their bank in Macedonia. The Euro area is out of recession. You were the most optimistic, even more than the government, and projected growth of 2.2 percent for this year. Do you remain at this projection or will it go up? The latest projection is still 2.2 percent, although we make a reassessment every month. Currently, developments are somewhat more favorable than those we have taken into account in our projection of 2.2 percent. It is true that at the very beginning we came out with the highest estimate for the economic growth this year. The data available so far suggest that we would be the closest to the actual development, which could be even better. In the beginning, in the first and second quarters, growth in the Macedonian economy was driven by some factors that were not very much related to the situation in the euro area, but our expectations for the second half of the year were that the European economy will recover, and that it will contribute positively to growth.
PLATFORM FOR DISCUSSION  EVENT: BIS Meeting of the Working Party on Monetary Policy in Central and Eastern Europe DATE:  NATIONAL BANK OF THE REPUBLIC OF MACEDONIA  9–10 February 2017  info@nbrm.mk  LOCATION: Budapest, Hungary  www.nbrm.mk  Lingering low interest rate environment and monetary accommodation in the euro area - impact on the region? Anita Angelovska Bezhoska, Vice Governor of NBRM Ana Mitreska, Director, MPRD1, NBRM Sultanija Bojceva Terzijan, Deputy Director, MPRD, NBRM  1  Monetary Policy and Research Department. Lingering low interest rate environment and monetary accommodation in the Euro Area – impact on the region? A decade after the global crisis outburst, withdrawal of the ECB unprecedented monetary stimulus seems distant. The low interest rate environment, breaking of the nominal zero lower bound frontier and the enormous balance sheet of the central bank, linger on, being a reflection of the economic malaise and low inflation. Decisive standard and non-standard monetary policy2 action supported the impaired financial markets and impacted the terms of financing and hence the recovery of the Euro Area economy. Yet, the growth agenda is to be completed, as healthy expansion is still not achieved and balance sheet crisis in the Euro zone is still present.

The average rate of change in the last three years is still negative in countries like Slovenia, Hungary, Latvia, Croatia, Bulgaria, indicating that some structural obstacles, such as high NPLS, new regulatory requirements, deleveraging of the private sector, still act as drag for a stronger credit revival. Also, cleaning up of the balance sheet of the banks may to some extent distort the data on the credit support. In order to make a qualitative dynamic review of the main forces behind the lending behavior of the banks in the region, we do a recap of the main findings of the CESEE Bank Lending Survey from 2013 until present day4. The recap points to several important conclusions. First, credit supply from being tight in the second half of 2013, was gradually eased until the first half of 2015. Afterwards it stabilized, and no major changes were observed. In all of the surveys, including the last one for the first half of 2016, the new regulatory environment and capital constraints, as well as the NPL ratio are pointed as key factors which adversely impact supply conditions. Second, demand for credits was improving throughout the whole period, since the second half of 2014 in particular. Furthermore, since 2015 credit demand for investments purposes is also visible, signaling positive structural shifts. Third, access to funding of the banks, in general was not signaled as problem even at the beginning of the survey, indicating that funding problems that emerged at the beginning of the global crisis were alleviated.
You must re-evaluate the securities’ portfolio quality, in particular that in foreign currency, in order to attain the optimum characteristics of safety and tradability. In addition, the portfolio of placements in foreign currency in the form of deposits or related products with international financial institutions should have as its main objective the safety of the investment and the adequacy of maturity term. In a broader context, you should reassess the adequacy of certain indicators’ level in terms of differences in maturity terms and the type of currency of assets and liabilities. Assets’ quality, which is mainly affected by the quality of loan portfolio, remains a constant risk to the banking business in general. The reduced quality of assets does not only impair the institution’s income, but also harms its liquidity position. In the case of the Albanian banking sector, the loan portfolio quality has been decreasing, although at gradual rates, and the situation is presented as entirely manageable. The rapid growth of credit and the challenges certain sectors of the economy that have been lent significantly may be faced with, are factors that will continue to exert pressure on the loan quality in the near future. Hence, it is crucial for you to implement a policy of rapid detection of non-performing loans and promptly create reserve funds. It is for this reason that the Bank of Albania will increase the frequency of controls and the efficiency in monitoring and checking this process.

I repeat from the previous forum that it is necessary for you to consider the macroeconomic consequences of your behaviour at an industrial or institutional level, since they are important factors which ensure the long-term stability of your institutions and the system in general. The difference between large and small-size banks, when public confidence in the system in general is in question, is relative. Each bank has its role and share in the system and the difference between the concept “a small bank” or “a large bank” in the context of systemic risks, is ever-increasingly reducing. In addition, the U.S. financial crisis was caused by the imprudence of financial institutions to assess the stability of private debt and accurately weigh the effect of macroeconomic developments on the U.S. household budget. Its consequences remind us of the expression “there's no such thing as a free lunch”. With regard to the issues explored in the forum held in April, I would like to bring to your attention two other issues that I believe remain indisputable priorities for our work in the future. As promised in the first forum, the Law “On repurchase agreements” has become effective upon its entry into force on August 19th 2008. Although this project was pre-announced by the Bank of Albania, according to the information made available by the operational staff of the central bank and the respective commercial banks, we notice that the entry into force of this law has found you unprepared.
Against this background I shall be discussing the current monetary policy appraisal of the Swedish economy, together with some factors of importance for the final assessment. First, however, I shall briefly outline monetary policy’s line of thought. Forecasts and probabilities Monetary policy’s overriding objective is to safeguard the value of money. The annual rate of inflation, measured as the change in the consumer price index, is to be kept at 2 per cent. As it takes time for the Riksbank’s monetary measures to work in full, our actions have to be based primarily on an assessment of inflation’s future path. The policy horizon - the period in which most of the impact of monetary policy materialises - is around twelve to twenty-four months. The Riksbank’s assessment of future inflation is presented continuously in our Inflation Reports. Since the first Report was presented in October 1993, the content has been developed and the Riksbank has, for example, become increasingly explicit in its assessments. In the first two years the Report contained a more general account of how the inflation indicators and inflationary pressure in the economy were developing. From November 1995 onwards the Riksbank has been attaching numbers to its inflation assessments. In the June 1996 Report the inflation assessment was underpinned for the first time with an overall picture of the cyclical position. A further step was taken in September 1997, when the inflation assessment was supplemented with a path for inflation in the forecast period.

By country, among the four largest euro area economies, the output loss was more pronounced in Spain (9.1%) than in Italy, France and Germany (down 4.5%, 4.1% and 4.2%, respectively). 1  Much uncertainty also persists regarding the intensity of the recovery in the fourth quarter of the year, in view of the recent course of the pandemic in Europe. The few short-term indicators available signal a slowdown in activity growth, which could be exacerbated – and even lead to contraction in at least some countries or sectors – by the widespread implementation of new measures to contain the health crisis. In the euro area, the PMI (the most leading indicator) for October fell by 0.5 percentage points (pp) to 50, standing at the boundary between expansion and recession. The pandemic is having a notably uneven impact, affecting primarily the services sector, whose PMI fell 1.1 pp to 46.9. Conversely, the manufacturing PMI rose 1.3 pp to 58.4. Similarly, the European Commission’s consumer confidence indicator also contracted. The latest ECB staff projections were published in late September; the baseline scenario indicates a drop in euro area GDP of 8% in 2020, followed by growth of 5% in 2021. However, the feasibility of these figures is in doubt, since one of the assumptions under this baseline scenario was that the epidemiological situation would not worsen in the near term. Developments since the projection cut-off date appear to contradict that assumption. The recent news regarding the availability of a vaccine early next year is obviously to be welcomed.