samchain/econo-pairs-v1 huggingface dataset:
Book capital is now equivalent to 5.2 per cent of total assets, compared with 4.2 per cent in the mid-1990s. The Commission Bancaire is at pains to ensure that all French banks - small and large - build up their capital gradually but steadily until it well exceeds the regulatory minimum. Furthermore, provision cover for doubtful loans now stands at 60.4 per cent. The industry must pursue this prudential policy. In particular, as we have been urging for several years, it must capitalise on the progress made in future risk analysis, based on statistical databases and stress testing, to adopt a more forward-looking provisioning policy. This has already been accomplished in several areas of sectoral or geographical risk. That being said, we firmly believe that international accounting standards should move in this direction, fostering the widespread use of forward-looking provisions and thereby contributing immensely to financial stability. In a context of economic crisis, the constant strengthening of French credit institutions’ financial structure gives them an appreciable safety margin, which could also allow them to play a part in the consolidation of Europe’s financial industry. 2.2  Priority has rightly been placed on controlling risks and ordinary profitability  The other fundamental elements that contribute to the resilience of French banks’ earnings are risk management and control over operating conditions. As you know, the Commission Bancaire places a premium on ensuring that French banks, and credit institutions in general, generate satisfactory profits at operating level.

This naturally impacted the financial health of the corporate sector, and business failure rates rose to levels comparable to those of the early 1990s. These economic trends, combined with the discovery of egregious shortcomings in corporate governance, fuelled misgivings about stockmarkets. And amid a global bear market, equity volatility soared. Consequently, as in 2001, capital market business in the broad sense of the term - securities, mergers and acquisitions, and the fees and commissions charged for these activities - were adversely affected. 1.2  Despite an unfavourable climate in 2002, French credit institutions reported net income on a par with 2001. French credit institutions reported net income of 17.7 billion euro in 2002, the same as in 2001. This works out to a return on equity of 9.4 per cent for the industry as a whole. As in previous years, these results were largely attributable to retail banking business in France. Consumer credit and home loans continued to grow, along with specialised financial services. In addition, falling interest rates had a positive effect on interbank business - which in France has always been significant - and drove down the net expense on these transactions. By contrast, capital market activities and asset management were hit by financial market turbulence, giving rise to substantial provisions in some cases. Furthermore, for the second year running, fees and commissions contracted as a percentage of net banking income, falling to 26 per cent compared with nearly 30 per cent in 2000.
Recognizing these trends, Bank Negara Malaysia launched the International Center for Leadership in Finance (ICLIF) in 2003 to accelerate the development of top management talent for the corporate and financial sector within the Asian region. At the management trainee level, the Bank has initiated the Financial Sector Talent Enrichment Programme or in short FSTEP, a joint collaborative effort undertaken with the industry and training institutes aimed at boosting the supply of well-trained and competent personnel for the financial services industry. This is complemented by the International Centre for Education in Islamic Finance (INCEIF) which was established for the purpose of meeting the increased demands of Islamic finance professionals as well as conducting research and consultancy in Islamic finance. I would very much like to encourage you to take the opportunity of participating in some of these programs. Finally, no less important an area for consideration in re-engineering financial sector development, is consumer education and protection. Today, we experience growing consumerism as well as changing consumer preferences and expectations in tandem with increased education levels and growing personal wealth. These and other developments collectively reinforce the need for greater financial literacy to ensure the efficient functioning of the financial system. An important aspect of Bank Negara Malaysia's regulatory strategy and approach therefore, has been to ensure that the continued growth of the financial sector is underpinned by fair market practices and conduct.

Overall, the evidence that trade has depressed the 10  wages of unskilled workers in the developed world is mixed at best . Instead, most economists have argued that the more important factor behind rising wage inequality in the United States has been the “skill-biased” nature of technical progress – the fact that computer technology seems to have added more to the productivity of high-skilled than lower skilled employees. One recent and well-publicised IMF study made the same point (Chapter 3, World Economic Outlook, April 2017) but this is only the latest in a very extensive and long-lived literature that has reached broadly similar conclusions. 8  Note that this could reflect the effect of a period of unemployment – so-called “scarring” – and needn’t say anything about the impact of trade on wages. 9 Krugman (1995). 10 Harrison et al. (2011) provide a useful survey; Haskell and Slaughter (2003) provide a careful anaylsis designed to distinguish the effects on wage inequality of both technology and trade and find only weak effects of the latter; Stone and Cavazos Capeda (2012) find some effect of imports on wage differentials but, allowing for their impact on productivity, positive effects across the distribution. 10  All speeches are available online at www.bankofengland.co.uk/speeches  10  I can’t possibly do any real justice to this work. Nor should I over-state its results. None of it attributes everything to the nature of recent technical progress or dismisses entirely the impact of trade on inequality.
Conclusion The changes in the financial system since 1998 confront us with a mix of benefits and challenges. The larger size and scope of the core institutions, the greater opportunities for risk transfer and hedging provided by innovation in derivatives, the improvements in risk management, the larger role played by a much expanded number and more diverse mix of private fund managers seem likely to have improved the stability and resilience of the financial system across a broader range of circumstances. The same factors that may have reduced the probability of future systemic events, however, may amplify the damage caused by and complicate the management of very severe financial shocks. The changes that have reduced the vulnerability of the system to smaller shocks may have increased the severity of the large ones. Supervisors need to continue to focus attention on reducing the vulnerability of the market to these low probability, but extreme events, while preserving the benefits that have come with these changes in financial markets. The limitations of the conventional risk-management tools in assessing potential losses in the adverse tail of possible outcomes in today’s financial system magnify the risk that individual institutions will operate with less of a cushion than might be desirable for the market as a whole. As the structure of markets change, we need to continue to review whether the overall framework of supervision over the core banks and investment banks provides the right balance of efficiency and resilience for the system as a whole.

In most circumstances, increased trading and participation contributes to market liquidity and makes markets less volatile. The ultimate benefit should be lower risks for all market participants. This in turn should reduce the risk premia associated with holding financial assets, and ultimately reduce the cost of capital. The rapid growth in the relative importance of these leveraged financial institutions has been accompanied by a number of structural changes as well. The total number of funds has grown dramatically. There are more very large hedge funds and private equity firms. Greater institutionalization, and the maturity of risk management and operational infrastructure in the largest of these private funds, has likely reduced operational risk. To the extent these changes have increased the diversity of firms and strategies in this part of the financial system, and this is hard to measure with any confidence, this heterogeneity should provide diversification opportunities, foster more efficient price discovery and could help improve stability. These changes in market participants have occurred in conjunction with a dramatic acceleration in number and type of derivative instruments. These developments have likely had the important impact of allowing for a more efficient distribution and more effective management of risk. All of these changes should move the market in the direction of fostering the efficient allocation of credit and capital formation, and thus enhancing the economy’s real growth potential.
This focus is appropriate. Like other central banks, our monetary policy mandate concerns domestic objectives: maximum sustainable employment and price stability. Our monetary policy actions, however, often have global consequences that, in turn, influence the U.S. economy and financial markets. At the same time, external factors can impact the monetary policy transmission mechanism in the U.S. and influence the effectiveness of our monetary policy in achieving our objectives. We cannot appropriately calibrate policy without keeping these spillover and feedback effects in mind. In some cases, these effects can be significant. An example is the market volatility we saw in the spring and summer of 2013 during the so-called “taper tantrum.” In the U.S., we saw a spike in Treasury yields, with the 10-year rate rising by more than 100 basis points from early May of that year before peaking in September. Financial markets in emerging market economies (EME) were hit hard as well, with declines in equity prices, a widening in sovereign debt spreads and a sharp increase in foreign exchange volatility. Volatility in EME financial markets re-emerged last summer and has continued into this year. For EMEs as a group, declines in equity prices and currency values have been larger than what we experienced during the taper tantrum. The recent episode, however, appears to largely reflect concerns about risks emanating from EMEs themselves, rather than concerns about the direction of Fed policy. Three related concerns appear to be at the forefront. First, there has been a broad-based slowdown in EME growth.

In short, given the current conjuncture, the avoidance of excessive borrowing both by the public and private sector; preference of longer maturities in all borrowings, opting to borrow in TL as much as possible and managing risks efficiently will considerably strengthen the resilience of Turkish economy against external shocks. The monetary policy adopted by the Central Bank is composed in a way to make price stability and financial stability complementary. In this context, I would like to evaluate how the CBRT will use policy tools in the upcoming period within the framework of possible scenarios provided in the inflation reports. As also demonstrated on the slide, the current conjuncture supports the CBRT’s stance of keeping policy rates constant for some time, and at low levels for a long period. On the other hand, developments in the aggregate demand composition necessitated that instruments other than the policy rate be brought to pre-crisis levels. In this respect, we have largely completed the exit strategy measures that we announced in April 2010. 2  BIS Review 174/2010  In the October Inflation Report, we stated that our baseline scenario was based on an outlook where domestic demand is stronger compared to the previous reporting period, external demand continues to restrain economic activity, and thus aggregate demand conditions continue to support disinflation, albeit to a lesser degree.
And the fact that consumption is so volatile – in itself as well as in relation to income – suggests the existence of serious limitations in the ability of economic agents in emerging markets to smooth consumption in response to shocks. A central proposition of our studies is that a large part of the explanation for higher macroeconomic volatility in emerging markets rests with key differences in the nature of shocks hitting emerging market economies, as well as the way in which the economic system of emerging markets propagate the shocks. Figure 1 captures our basic arguments, and depicts how observed macroeconomic outcomes are the result of the interaction between the nature of shocks and the structural features of the economic system. 2  BIS Review 98/2008  Firstly, the nature of shocks that emerging market economies experience is quite different from that of developed economies. A particularly pertinent example in this context is capital flow shocks. By virtue of their limited access to capital relative to their growth potential, emerging market economies are natural recipients of capital inflows from capital-rich economies. These inflows are attracted by prospects of higher return and provide the necessary funding of investments that facilitate economic development, especially when the inflows are of the type that bring technological transfers and managerial expertise. But as shown in Table 2, capital flow shocks, especially debt and equity, are more volatile in emerging markets relative to developed economies, as well as relative to other developing economies.

We will work hard, so that all the interested persons, whether in Albania or abroad, will be able to learn about the history of banking, money and people that have dedicated their life and work to it. I am certain that very soon the Museum of the Bank of Albania will be a place to visit the exhibition, and exchange opinions and ideas about banking and money Concluding, I would like to thank you for your participation and contribution to the conference and wish success in these two days of the conference. Thank You! 2/2  BIS central bankers' speeches
In 2001, we expect the US economy to expand by less than half the rate recorded last year. Growth in the Japanese economy is also sluggish, but the downturn in Japan has continued for ten years. 4  BIS Review 19/2001  At the beginning of the 1990s the financial bubble burst, following a sharp increase in stock and property values in the preceding years. The banking industry faced serious problems, which have still not be solved. In addition, government debt has increased sharply in recent years, but neither strong growth in public spending nor near-zero interest rate levels has sufficed to boost growth in the Japanese economy. BIS Review 19/2001  5  Growth in Europe was weak in the mid-1990s. The situation has shown a substantial improvement, particularly from 1997. Growth has picked up and unemployment has declined in an environment of moderate price and wage inflation. The US and Japan account for close to a third of the world economy. When their economies deteriorate, the question is whether the upturn in Europe is sufficiently robust to maintain its momentum. Historically, there has been a close correlation between developments in the US and Europe. Slow growth in the US economy will also now have an effect on demand for European goods, but the effects via financial markets are likely to be more important. A turnaround in the US could feed through to European stock markets and may also trigger financial unrest.

On 15 January, the Swiss Franc moved by more than 30 standard deviations. For rough scale, an 8 standard deviation move should happen once every three billion years or so for normally distributed data. You may at this point recall the saying popularised by Mark Twain, about “lies, damned lies and statistics”. I think I can be reasonably confident in saying that the fact of these events happening does not mean that we should expect low volatility in financial markets for at least the next three billion years. I am not going to spend time discussing the causes of these events; suffice to say that there was news of an unexpected sort, and the size of the resulting moves points to greater sensitivity in the response of markets. The ability of markets to trade without triggering major price moves was limited. That said, by the end of both days, volatility had reduced, prices had retraced a portion of their peak intra-day moves and liquidity returned. This quick stabilisation helped to limit contagion to other markets, and thus wider effects on the stability of the financial system. Should we therefore be concerned? My answer to that is we should certainly be keenly interested. I agree with the conclusion of the Federal Reserve Bank of New York that understanding the manner in which the evolving market structure is affecting market liquidity, efficiency and pricing is highly important (Potter (2015)).
Vendors and service providers need to be flexible to pass on the benefits of technological advances to a larger group of users. Demand driven innovations should also be promoted and vendors should look for volumes and turnover, rather than high-priced software sales. 5. Agenda for SAARC region payment systems development  5.1 The banking community in India as well as in other SAARC countries need not reinvent the wheel. There is good news. Following a request made by the SAARC country  BIS Review 61/2008  7  Governors, a SAARC Payments Initiative has been set up to take forward the payment reforms in the region. Within this Initiative, a SAARC Payments Council (SPC) has been set up, consisting of high level officials from SAARC central banks who are also the Chairpersons or senior members of their national payment councils. SPC will be the policy making authority for both high value and retail payments. The organisational structure is considered a very practical one, because of the involvement of all national stakeholders in the national payments councils, which will provide a good forum for the banking community and all service providers to give their inputs for retail payments developments in their own countries, as well as in the region. Currently, Sri Lanka chairs the SPC and a Secretariat has been set up in Colombo to facilitate operational processes. SPC has already prepared a road map for the first year and a rolling plan for the medium term. 6.

This gives the Fed more latitude not to tighten when inflation rises for transient reasons – say, due to a short-lived spike in oil prices – and more scope to ease credit to support the economy during economic downturns. Recognizing these benefits, Congress wisely acted many years ago to exempt monetary policy decisions from the GAO’s wide powers to review Federal Reserve activities. Congress’ decision to bolster the Fed’s monetary policy independence has been followed by similar actions around the world – substantial independence for the central bank in the conduct of monetary policy is now widely regarded as international best practice. Policy independence does not absolve the Federal Reserve from accountability for its monetary policy decisions and the need to clearly explain why they were taken. But it avoids the politicization of monetary policy decision-making. And this is good because politicized central banks generally do not have enviable records with regard to inflation, economic growth or currency stability. Risk premia on financial assets are typically much higher in countries with politicized central banks. Of course, a reversal of Congress’s earlier decision would not amount to legislative control over monetary policy decisions. That’s not the issue. The issue is that a reversal of Congress’ earlier decision could create the appearance that the legislature seeks to influence monetary policy decisions by establishing a mechanism to publicly second guess those decisions. Such a move would blur what has been a careful separation of monetary policy from politics.
Stronger initial cushions against stress reduces the need to hedge risk dynamically in a crisis, reducing the broader risk of a self-reinforcing, pro-cyclical margin spiral, such as we have seen in this crisis. 4  BIS Review 74/2008  How should we decide where to set these constraints on risk-taking? This is hard, but the objective should be to offset the benefits and the moral hazard risk that come from access to central bank liquidity in crises, without setting the constraint at a level that will only result in pushing more capital to the unregulated part of the financial system. Risk management and oversight now focuses too much on the idiosyncratic risk that affects an individual firm and too little on the systematic issues that could affect market liquidity as a whole. To put it somewhat differently, the conventional risk-management framework today focuses too much on the threat to a firm from its own mistakes and too little on the potential for mistakes to be correlated across firms. It is too confident that a firm can adjust to protect itself from its own mistakes without adding to downward pressure on markets and takes too little account of the risk of a flight to safety – a broad-based, marketwide rush for the exits as the financial system as a whole de-leverages and tries collectively to move into more liquid and lower risk assets of government obligations.

Should it now be the case that we are entering a longer period of persistently higher inflationary pressures – which we do not know yet, of course – then my assessment is that the framework of wage-formation we have today will act as a built-in and useful brake in the system. Thirdly, a stricter and more robust fiscal policy framework was introduced after the crisis in the early 1990s. This has contributed to public finances now being in a much better shape than they were in the 1980s and 1990s. A large and growing sovereign debt may raise inflation expectations, if agents suspect that the government may eventually try to solve the problem of by inflating the debt away. This means is that the central government reduces the real value of the debt by letting inflation rise. However, unlike in the 1970s and 1980s, we have now a number of control mechanisms in place, which means that this potential source of excessive inflation has in practice been eliminated. My reflections on the current situation So, in conclusion, how do I view the current situation more specifically? And what can we learn from history? During many of the periods of high inflation in connection with war, the effects of monetary policy have been heavily dependent on the expectations of companies and households regarding future economic developments. There is an example of a deflation spiral after the First World War when expectations of lower prices in the future led to falling aggregate demand.