samchain/econo-pairs-v1 huggingface dataset:
The public authorities had no means of directing the insolvency process to prioritise the protection of depositors, the continuation of the bank’s critical functions or wider financial stability concerns. There was no way to recapitalise a failing bank by bailing in its creditors. As a result, when faced with the failure of a bank of any size, the UK authorities had only a stark choice between a very disruptive insolvency, putting financial stability at risk, or a taxpayer bailout. The UK was not of course the only jurisdiction to discover in the financial crisis that it did not have an effective regime for dealing with the failure of banks. And, as we discovered when Lehman Brothers failed, the authorities in different jurisdictions had no preagreed means of coordinating with each other on how to deal with the sudden failure of a major cross-border bank. Nor had they any confidence that the actions taken by authorities in another jurisdiction would align to their own national interest. With hindsight it is clear we had been lulled into a false sense of security. In Britain, Northern Rock represented the first major run on a bank since the failure of Overend Gurney in 1866. Unlike, for example, th  the US, the UK had not experienced bank runs in the 20 century. Banks in the UK had failed.

In the UK, the Independent Commission on Banking suggested a capital surcharge of 3% of risk-weighted assets (RWA) for banks that could not be resolved. In its 2015 assessment of capital adequacy, the Financial Policy Committee estimated that capital would need to be around five percentage points higher if there was no resolution regime in place. It is also argued that resolution will not work; that while it may be a way of dealing with idiosyncratic failures, in a systemic crisis authorities will be reluctant to bail in shareholders and bank creditors. This binary distinction between idiosyncratic failure and fully blown systemic crisis seems to me oversimplistic. For sure, if we were suddenly to find ourselves pitched back into the middle of a systemic crisis, with a number of major institutions having failed or on the point of failure and a complete breakdown of trust and confidence, orderly resolution of individual banks in itself is unlikely to be able to stabilise the system as a whole. But we did not suddenly arrive in late 2008 in the midst of full blown financial crisis. Had the authorities had better, less disruptive options available over the previous 18 months to deal with a series of failing institutions, the disruptive, explosive nature of the crisis might well have been minimised. There would still have been very major losses and failures. But we would, in my view, have had a much better chance of a more orderly, less damaging correction of an overleveraged banking system.
The best environment that the central bank can provide for the economy to attain a high level of output and steady growth is one with price stability. Under inflation targeting, the Monetary Policy Board has to look ahead 18-24 months and adjust its stance today to influence the outcome of the future. This will help minimize the boom and bust phenomenon. The floating exchange rate regime will also help prevent imbalances from building up excessively, hence minimizing the risk of major crises. In terms of transparency and accountability, inflation targeting is probably the best tool of communication. While the general public may have difficulty understanding and keeping track of monetary growth targets, it fully understands inflation, the index of which is calculated and announced by an independent agency, in the case of Thailand the Ministry of Commerce. The regular publication of inflation reports will also help inform and educate the public much better than in the past. In the case of Thailand, inflation targeting is the best tool to ensure high output, sustainable growth, export competitiveness, prevention of a worsening of income distribution and a transparent and accountable central bank. The Bank of Thailand last year announced our explicit intention to control inflation, and the range of 0 to 3.5% of core inflation was announced in 23 May 2000. Since the beginning of the year, we have seen the yield on 10-year bonds drop from 7.91% per annum to 6.1%.

My second congratulation is also for Governor Paul Acquah for having achieved the Central Bank independence. I have noted that the Bank of Ghana was established in 1957. The Bank of Thailand was established in 1942 and we have not managed to gain independence through legal means yet. So, you are one up on us. Ladies and Gentlemen, the issue of “Central Bank Independence and Monetary Policy” is very much closed to the heart of all central bankers, and I am very happy to be able to share some thoughts on it. In Thailand's case this issue has been much discussed among all concerned throughout the 60 years period since the Bank of Thailand's establishment in 1942. One of the most famous governors of the Bank of Thailand and certainly the longest serving Governor (more than 10 years) had this to say about central bank independence and I quote “…If the policy in question is so profound that it might undermine principles or lead to catastrophe, the Central Bank Governor may not only voice his disapproval against it, but he also has the ultimate prerogative of resigning from the governorship”. Dr. Puey Ungphakorn was an outstanding Governor who gave great importance to the Bank of Thailand to carry out its functions as an independent institution free from political and governmental domination, undaunted by any influential powers-that-be. For the sake of his country-and using the delicate art of being a central banker, Dr. Puey protested against the government whenever it did not act righteously.
The euro countries are marked by the debt crisis and growth prospects have deteriorated somewhat compared to the end of last year due to new consolidation measures and a tighter credit situation. There are, however, a number of bright spots in the US economy, where the labour market is improving and the housing market is showing early signs of a positive turnaround. With regard to the global economy as a whole, the Riksbank’s forecast is that growth will continue to increase at a relatively good rate in the years ahead, after having declined somewhat in 2012. This is shown in Figure 1. BIS central bankers’ speeches  1  Figure 1. GDP in various regions and countries Quarterly changes in per cent calculated as an annual rate, seasonally adjusted data 6  6  4  4  2  2  0  0  -2  -2 The world  -4  -4  USA Euro area  -6  -6 00  01  02  03  04  05  06  07  08  09  10  11  12  13  14  Sources: Bureau of Economic Analysis, Eurostat, the IMF and the Riksbank  For some time now, an important assumption in the Riksbank’s international forecast has been that the euro countries, by implementing various measures, will succeed in reducing the most acute anxiety about the debt problems in the euro area during the course of 2012.

Caleb M Fundanga: Improving the savings culture of Zambians Remarks by Dr Caleb M Fundanga, Governor of the Bank of Zambia, at the official launch of CETZAM’s “Tusunge” Savings Product, Lusaka, 8 July 2011. *  *  *  The Board Chairperson of CETZAM Financial Services Limited, Mr Frederick Nduna; Members of the Board of CETZAM Financial Services Limited; The Chief Executive Officer of CETZAM Financial Services, Mr Dyson Mandivenga; Chief Executive Officers and Representatives of various organisations present; Distinguished Invited Guests; Members of the Press; Ladies and Gentlemen. Let me begin by thanking the Board of Directors and Management of CETZAM Financial Services Limited (CETZAM) for inviting me to this occasion, which marks the official launch of the “Tusunge” Savings Product. May I commend the Management of CETZAM for their foresight in developing this new savings product, which will go a long way towards inculcating a savings culture and enhancing financial inclusion within our financial sector. As a financial sector regulator, the Bank of Zambia is pleased to be associated with the achievements of the institutions we regulate, particularly where these developments lead to increased access to financial services for the Zambian public. This is what CETZAM is doing this morning. CETZAM’s focus to introduce innovative products is adequate testimony of its commitment to serve the financial needs of the Zambian people. I am informed that one of the key objectives of CETZAM Financial Services Limited is to provide sustainable microfinance services to the economically disadvantaged citizens of Zambia.
The talks between the interested parties themselves and with the Fund did not however prosper. Accordingly, the Banco de España took action to avoid a crisis of confidence in CCM and market convulsion. On this point I should like to draw your attention to the reasons for adopting this decision with such urgency. Article 31 of the Law on the Discipline and Intervention of Credit Institutions authorises the Banco de España to take control of a credit institution or to resolve to replace provisionally its governing and management bodies when there is a situation endangering its own funds or its stability, solvency or liquidity. Since the directors of CCM had been unable to find a solution to prevent the problems worsening, it did not seem reasonable to delay the use of the precautionary measures provided for in the Law on the Discipline and Intervention of Credit Institutions in order to seek other solutions. Further, once the prospect of a merger had fallen through, there was an evident risk that, once the financial markets opened on Monday, 30 March, CCM would be subject to a crisis of confidence on the bond markets and further withdrawals of deposits from its branch network that could prompt a liquidity collapse. The delicate situation of CCM required the immediate activation by the Banco de España of the precautionary measure provided for in the rules governing the replacement of the Board and the appointment of new managers.

This very significant advance in terms of financial regulation should not obscure the progress that still needs to be made regarding the work underway, especially in the areas of market infrastructures (including for commodity markets), tighter regulation of activities included under the designation the “shadow banking system” and the behaviour of market players themselves. Once again, I underscore our collective responsibility, which is to ensure that all of the G-20 countries and, more widely, the international community as a whole apply international standards. Today’s discussions will be divided into four sessions. The first, chaired by Axel Weber, will examine the notion of disequilibrium after the crisis and will allow us to discuss the unpredictable evolution of global imbalances in the medium term, in the light of different assumptions concerning economic growth and savings trends in the different zones. Mario Draghi has agreed to chair the second session that will focus on questions related to supervision and coordination. As I have already said, the current context is characterised by the reform of global governance and regulation, a process given impetus by the G-20. Therefore, at this stage, it seems appropriate to explore topics such as the evolution of the role of international financial institutions and the accomplishments and future progress in harmonising global financial regulations. The third session, chaired by Michel Camdessus, should help us to gain further insight on what could, or should, be the role of central banks in a post-crisis environment.
It is desirable that the interaction of fiscal and monetary policy continues to function well. There are strong reasons for adhering to the rules that have been established. An increase of 1 percentage point in the level of interest rates weakens the budget balance by about SEK 10 billion. A continued amortisation of the sizeable government debt will create much-needed room to manoeuvre in economic policy. There will be more scope for stimulating increased demand in future slowdowns. At the same time, tax cuts would clearly benefit the Swedish economy in the somewhat longer run. But the cuts must then be concentrated to just those taxes that play a major part in the workings of the economy, where changes can help to raise potential output. Together with other measures that improve wage formation and the functioning of the labour market, such tax adjustments could lead to the creation of new jobs without an acceleration of inflation. The more steps that can be taken in this direction, the better will be the conditions for a continuation of a good economic development in Sweden. This BIS Review is available on the BIS website at www.bis.org. BIS Review 77/1999  8

•  Timetables could be improved - linking them more closely to national processes. •  Using the now more developed measures of cyclical balances could also be useful in this context. In general, I think it is important to enable the Commission to dig deeper into these areas and to increase the comparability between different countries. On the basis of this work the Commission’s role should be strengthened as regards giving “early warnings” and proposing measures. I also believe that the Commission should have the task of emphasising its analyses and going public more than it does today, thereby being more effective in the general debate in the individual member states. III. My third point has to do with consolidating the fiscal institutions and regulations at national level. Here a lot more can be done. One aspect that too often seems to be forgotten in the debate on the pact is that a balanced, countercyclical fiscal policy is not just a common European interest; it is in the individual interest of each country. Some politicians contribute to this misunderstanding when they depict the commonly adopted criteria as an unreasonable burden from “accountants in Brussels”. One manifestation of the same attitude is the recurring problems with the data that are sent to the Commission. Instead of having a transparent process, increasingly unrealistic figures are being delivered. There are several examples of governments reporting data before an election that after the election proved to be misleading.
To attract investment on a large scale, however, it is necessary to have a reasonably effective judiciary, an adequately skilled labour force and other facilities; these are by no means always available and here it is the developing countries that need to act. It is on account of problems such as these that investment from the industrialised countries still goes in the first place to so-called emerging markets and to only a minor extent to the poorest countries. The situation also calls for structural adjustments in the industrialised countries, a process that leads in turn to new job opportunities; these countries have to focus on new activities of a different kind that can carry higher wage costs, for example. This is the same in principle as what happened earlier in Sweden, for instance. We have moved from a state more than a century ago when nearly everyone worked in agriculture to one where first manufacturing and now service industries have taken over as the dominant source of employment. This is the process that has doubled our material prosperity many times over. But it has not been painless. While many people became better off, the need for adjustment excluded others from production. Countries like Sweden can now afford extensive social safety-nets but in developing countries these are often absent. And although barriers to international trade have been greatly reduced in recent decades, there are still a good many obstacles in both industrialised and developing countries.

In any event, it is important to work for a level of debt that is more sustainable, particularly in the poorer countries. Much has in fact been done in this respect. The IMF’s and the World Bank’s joint initiative for debt relief for the poorest and most 1 indebted countries was launched in 1996. In contrast to earlier efforts here, this initiative assembled all a country’s creditors, including the international financial institutions, to provide debt relief. The aim was to reduce the debts of poor and heavily indebted countries to sustainable levels and combine this with better conditions for increased growth. In 1998 it was decided to increase and accelerate debt relief in the context of the initiative. To a large extent this decision was a result of representations by church and other non-government organisations. To date, 24 countries have been promised debt relief equivalent to a total of over USD 20 billion at current values. Debt relief for the countries included in the initiative is calculated to cost a total of USD 33 billion. It is envisaged that the funds which debt relief makes available in the countries concerned will be used in the first place for increased efforts to combat poverty. Why, it may be asked, do we not write off all the debts of the poorest countries? The amounts involved may seem relatively small for the international community as a whole but that is not the case in relation to the resources that are currently available.
In January 1817 it was the only bank in the country. It received deposits, but charged a fee for that service. Thus, today’s situation with depositors having to pay for keeping their money in the bank is not entirely a new phenomenon. In the 1870s Norway joined a currency union with Denmark and Sweden that lasted until the outbreak of the First World War. The Scandinavian countries enjoyed strong economic growth during this period. Large cross-border capital flows supported the industrialization of the Scandinavian countries, and financial integration driven by the gold standard and the currency union was probably a contributing factor to the favourable development. Both Sweden and Nor-way were relatively poor countries situated on the outskirts of Europe when Norges Bank was founded 200 years ago, but with the advent of industrialization in the late  BIS central bankers’ speeches  1  19th century both countries began their journeys to become two of the richest nations in the world. Economic and political developments in Norway and Sweden have also showed similar patterns in the period since the Second World War. The role of the central banks was very limited in both Sweden and Norway. The monetary policy decisions were made by the government and Norges Bank became more of a technical implementer of government policy. For much of the 1970s and 1980s, economic policy in both Norway and Sweden lacked a long term strategy and credibility. Inflation and wages soared, and lost competitiveness resulted in repeated devaluations.

At the current juncture, however, a scarcity of funding and capital is likely to make banks cautious about doing this. That was exactly what happened in Japan during its so-called “lost decade”. But there are signs that the extra reserves may be contributing to a decline in the interest rate that banks pay to borrow from each other. It will take some time before we can assess just how effective Quantitative Easing has proved to be. Our latest assessment is that the combined stimulus from policy easing and the lower value of sterling should be sufficient to lead to growth resuming as we move towards the end of the year. But the continuing drag from the financial sector means that the ensuing pickup is likely to take place relatively slowly. There is, however, considerable uncertainty surrounding that assessment. Our primary objective is, of course, to control inflation, not growth. Our target measure, the Consumer Price Index, has been running above the 2% target for the past eighteen months, reflecting in particular the surge in energy and other commodity prices during the first part of last year. But it is now dropping back, reflecting both the sharp decline in energy prices in the latter part of 2008 and the growing margin of spare capacity in the economy. We expect it soon to fall below target and it is more likely than not to remain there for the next year or two.
Further details including transcripts of the oral evidence sessions are available on the Committee’s website. As set out most recently by Andrew Bailey in his 2020 Jackson Hole speech and accompanying paper. The supporting paper for Andrew Bailey’s Jackson Hole speech, mentioned above, gives a good overview of the evidence for the UK, as does Box B of the IEO report, while the 2019 BIS Committee on the Global Financial System report on unconventional monetary policy tools summarises the cross country evidence, as does Ben Bernanke’s 2020 AEA Presidential Lecture. 18 The Bank has actively contributed to work on this topic, with a notable contribution, for example, by Bunn, P, Pugh, A and Yeates, C (2018) "The distributional impact of monetary policy easing in the UK between 2008 and 2014." 15 16 17  9  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  9  Figure 5: Stylised QE transmission mechanism  Taken from the supporting paper for Andrew Bailey’s Jackson Hole speech.

The Centre provides an invaluable forum for this to happen. Through our academic workshops, technical assistance, seminars, courses, training, and visits, we can help other Central Banks to keep their economies and financial systems on an even keel, from which everyone benefits – and also to compare notes on the challenges they face and how best to respond to them.” I know I speak for Peter’s many friends and colleagues at the Bank in saying I wish Peter was still with us to help us to deal with the many challenges we face and how best to respond to them in these unprecedented times. 17  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  17