samchain/econo-pairs-v1 huggingface dataset:
These changes are speculated to lead to a marked decline in U.S. influence throughout the world and as a result the much talk about subject of the “new world order”. In our view, however, it might be more fruitful to discuss about the new global framework as a check on global imbalances rather than a new world order. This is because the ultimate winners or losers from globalization are yet to be decided. A long historical perspective is, therefore, needed in order to put the net social cost and benefit of globalization into a proper context. A new wisdom from financial globalization, however, is emerging. As Professor Rodrik will probably agree, reaping the benefits from globalization is by no means automatic. Globalization, financial or trade liberalization, all need supporting institutions for their gains to materialize. Furthermore, past experiences according to Professor Michael Bordo of Rutgers University, also indicate that although the globalization winners appear to outnumber losers in an increasingly integrated world, it is still possible that the losers (even temporary ones) can create a backlash that will once again cause a retreat in the globalization process. Ladies and Gentlemen, It is obvious that a global financial crisis will need a global solution. This symposium on financial globalization is thus very timely and come at a time when policy makers and market participants are in dire need of a better solution. And this year, we are honored to have with us many distinguished speakers from well-regarded institutions to discuss this important topic.

So this is an extraordinary time for the world financial market and probably most suitable for an international symposium on the subject of financial globalization. Ladies and Gentlemen, Financial globalization has certainly made the international financial landscape look very different today compared to just a decade ago. And almost every day, new events continue to re-shape it even further. One aspect among these changes, however, remains constant. That is, despite the complexity and sophistication of today's financial institutions as well as instruments that are developed to manage all kinds of risks, the remarkable degree of global financial linkage still makes financial turmoil transmit from one country to another at an ever faster pace than we have previously anticipated. Like all financial crises of the recent past, several weaknesses and excesses were initially submerged and only later found to be much larger than the initial estimates, contributing to the permanent boom-bust cycle that seems to always accompany modern business and finance. Understanding the various causes of the crises is only the initial step towards resolving its short-term impacts and preventing its recurrence, if entirely possible, in the longer-term. In the meantime, we will probably continue to have to witness an intensification of the financial crisis. As mortgage-related assets deteriorate further, economic growth will inevitably slow down even more, along with the downside risks of financial and the economic outlook.
As from the date on which the ECB’s decision on the establishment of close cooperation became applicable, the management of the Bank Resolution Fund (BRF) was taken over by the BNB. The funds in the BRF were respectively allocated into a sub-fund for funding the resolution tools and powers in relation to branches of third-country credit institutions and a sub-fund for raising the contributions from the credit institutions located in Bulgaria. The two sub-funds are managed separately. In compliance with the Intergovernmental Agreement on the transfer and mutualisation of contributions to the Single Resolution Fund, ratified by the Republic of Bulgaria in 2018, immediately after the initial date of close cooperation the amount of EUR 81 018 259.53 was transferred from the sub-fund for collecting credit institutions’ contributions to an account of the SRF. This amount is specified in a decision of the SRB of 18 September 2020 and is the first contribution to the SRF, equal to the amount which would have been transferred by the Republic of Bulgaria if it had participated in the SSM and the SRM as of 2016 – the year in which the Agreement became effective. After the first transfer, the money left in the sub-fund for collecting credit institutions’ contributions will be deducted from the banks’ liabilities for future contributions to the SRF, but it may not be used to directly fund the resolution of credit institutions operating in Bulgaria.

This seminar will be a useful platform for constructive dialogues among the financial industry, infrastructure-related business sectors, and AIIB, to exchange views on the latest infrastructural development trends, and how we can harness the opportunities arising from the establishment and projects under AIIB. I shall now hand over the time to President Jin for his most anticipated speech. Thank you. 2/2  BIS central bankers' speeches
14 We can see that they have not been entirely accurate. The forecasts we have produced for the exchange rate of the krona since the exchange rate was allowed to float have often indicated that the krona would strengthen. Typically, however, this strengthening has only materialised in periods preceded by a substantial weakening of the krona exchange rate, as in the periods 2002–2003 and 2006–2007. 12  Rose and Yellen (1989) is a classical study in this field. 13  The effects of a weaker krona on the Swedish economy were also described as an alternative scenario in MPR08:3. 14  The TCW index weighs together the krona exchange rate against other currencies according to the other countries’ share of Sweden’s foreign trade. The Riksbank’s forecasts in the Figure are from the first report (Monetary Policy Report or Inflation Report) of that year, which has usually been published in February. BIS Review 3/2010  5  Figure 2 The Riksbank’s forecasts for the krona exchange rate (TCW index) Index, 18 November 1992=100  Source: The Riksbank. Figure 3 Consensus forecasts for the krona exchange rate (approximate TCW index) Index, 18 November 1992=100  Sources: Consensus Economics and the Riksbank. 6  BIS Review 3/2010  However, the Riksbank has certainly not been alone in expecting that the krona will strengthen. Figure 3 shows the forecasts according to “Consensus forecast” for an approximate TCW index. 15 This can be said to represent the average of the other analysts’ forecasts at the same point in time.

Establishing an Oil Stabilisation Fund, which ensures that the government balance sheet is strengthened when oil price movements are favourable, should help insure against the type of debt servicing problems faced by many emerging market economies during the difficult international environment of 1997-98. Iran was able to maintain an excellent debt service record through this period, and prudent debt management policies should help preserve this record going forward. Total external debt is expected to decline to around 10% of GDP this year, and short-term debt to only about 40% of reserves, having fallen from around 65% in 1999/2000. The strong external position has encouraged the World Bank to approve loans of some $ million this year. Importantly, it should hold Iran in good stead in attracting inflows of private capital, which are so crucial to a country’s long-term growth prospects. The international financial crises of 1997-98 stemmed largely from vulnerabilities within countries’ financial systems. In the aftermath of the crises, the official community has been assisting the financial sectors in emerging market economies through technical assistance and improved surveillance. This has been an area of notable success in the redesign of the international financial architecture. A key step in this regard has been the joint IMF-World Bank initiative of Financial Sector Assessment Programs, or FSAPs.
Inflation will reach its low point in the third quarter of 2015, at –1.2%. For the subsequent period, the new inflation forecast is slightly higher than in March due to the rise in oil prices. The short and medium-term forecast is up slightly, by 0.1 percentage points to –1.0% for 2015 and to –0.4% for 2016. The forecast continues to indicate that inflation will move back into positive territory at the beginning of 2017; there will be a slight slowdown in the rate of increase as the year progresses. The inflation forecast for 2017 is down by 0.1 percentage points, to 0.3%. The conditional forecast assumes that the three-month Libor will remain at –0.75% over the entire forecast horizon, and that the Swiss franc will weaken. Global economic outlook As our inflation forecast is heavily influenced by economic developments abroad, let me now present our assessment of the global economy. Global economic growth was weaker than expected in the first quarter of 2015, and this development had a detrimental impact on world trade. In the US, GDP declined slightly, partly due to special factors. Moreover, the strong US dollar weighed on exports. In the euro area, however, the economy continued to pick up, supported by persistent euro weakness and improved lending conditions. In contrast to the previous quarter, all of the large member states contributed to growth. Italy reported GDP growth for the first time since entering a multi-year recession. In Japan, too, the economy gained momentum.

My colleague, Fritz Zurbrügg, will provide further details on interest rate developments on the money and capital markets. Despite the low interest rates, mortgage growth has continued to weaken slightly in recent months. Notwithstanding this, imbalances on the mortgage and real estate markets remain high. My colleague, Jean-Pierre Danthine, will discuss this in greater depth in his remarks. 1  2  In October 2014, Consensus Economics projected inflation expectations of 1.4% for the period 2020–2024; in April 2015, it put these at 1.5% for the period 2021–2025. Long-term inflation expectations are only surveyed on a half-yearly basis. BIS central bankers’ speeches  In light of the uncertainty regarding the future of Greece, the Swiss franc continues to serve as a safe haven currency. In trade-weighted terms, the Swiss franc is still approximately 12% higher than it was at the beginning of the year. Over time, negative interest rates on the Swiss money and capital markets should help to correct the overvaluation of the Swiss franc. The rise in long-term interest rates abroad has also led to a widening of the interest rate differential with these countries of late. As conditions continue to normalise on international financial markets, investments in other currencies should become more attractive; this, in turn, is likely to help ease the overvaluation of the Swiss franc. The slowdown we are now observing in the economy also suggests that the Swiss franc is very unlikely to remain persistently high. Monetary policy outlook I shall now move on to our monetary policy.
Probably, a greater elasticity of housing supply contributed to limit the increase in prices (Glaeser et al., 2008). Maybe, the creation of a bubble was avoided thanks to the way in which mortgage loans and related collateral securities are granted. I consider that a highly probable hypothesis is that, in view of the income levels prevailing in Chile, which are far below those of the developed countries, expansion of consumer loans is more oriented towards financing consumption of durable goods than houses. This issue remains open, but differences are evident. Anyway, this is an area which will have to be particularly addressed in the future (Figure 2). Besides, there were countries which had a housing boom, with housing prices soaring far above their fundamentals, such as Spain and Australia, but whose banking systems have shown much more resilience.3 Consequently, what happened in the United States was rather a growing fragility of its financial system, which passed unnoticed to the market and regulators. There was a deficient assessment of risks. They mistakenly felt that they were adequately covered and diversified by the new “originate and distribute” banking model. Prudential regulation, as well as internal policies on risk assessment of financial agents, resulted in a spectacular failure. This leads me to another important issue in the recent debate on monetary policy: whether monetary policy should take into account asset prices when making decisions on interest rates.

(2008), “The Financial Crisis and the Policy Responses: An Empirical Analysis of What Went Wrong,” NBER Working Paper # 14631. 7  We could argue that, as it was done when inflation rose, it was the result of the domestic demand cycle which, after growing fast, slowed down dramatically. However, slowdown of demand is happening throughout the world and a decrease in inflation is observed at a much higher level in Chile. Therefore, we are witnessing structural factors which go beyond changes in demand. 8  BIS Review 41/2009  Table 1  Projected Growth for 2008  (GDP measured at market prices, percent) Sep. 2008  Dec. 2008  Mar. 2009  World  2.5  0.4  -1.6  United States Eurozone Japan  1.4 0.9 0.9  -1.3 -0.9 -0.9  -2.8 -2.6 -5.8  Asia Pacific Eastern Europe Latin America  4.6 5.6 3.7  2.7 3.0 2.1  -0.2 -0.5 0.3  Source: Consensus Forecasts of corresponding date. Figure 1  Chile's MPR and US Fed funds  (percent) 12  12  10  10  8  8  6  6  4  4  2  2  0  0  90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 Fed Funds  MPR (*)  (*) As from August 2001, the monetary policy rate is set in nominal pesos; before that, it was indexed to headline inflation.
In the first case, we simulated the impact of different transition policies over a three-year horizon: 1) a rise in the price of CO2 emissions to € per tonne; 2) extension of the obligations to acquire emission allowances for the most polluting sectors to all other productive sectors; 3) a combination of the previous measures, which would be compatible with the aim of achieving net zero emissions in 2050; and 4) a combination of these same measures with an extension of the emission trading system to households. 17  This exercise comprises two instruments that operate separately but recursively. The first is a theoretical macro sectoral model, calibrated for the Spanish economy, which can be used to simulate the reallocation of resources across sectors resulting from the implementation of specific measures to combat climate change or technological innovations in this area. The second is an empirical model of the solvency dynamics of Spanish banks stemming from the results of the macro sector model, based on the tool for conducting stress tests (the so-called Forward-Looking Exercise on Spanish Banks (FLESB)). 7  Given the time horizon of the analysis (three years), these scenarios seek to calibrate the initial cost to the Spanish economy of the transition to a green productive model. The results show that the cost of applying these policies in terms of economic activity would be moderate over the first three years, although highly uneven across sectors.

Undoubtedly, the incorporation of these risks into their management decisions will help to change the relative prices of financial instruments in favour of those that fund more sustainable activities, thereby reinforcing the impact of other public policies. Today I wish to take this opportunity to describe the actions we as supervisors and financial regulators are taking at global level for this purpose. I will start by identifying the financial risks associated with climate change and the main channels of transmission to financial institutions, and then analyse the specific features of these risks, as well as the regulatory and supervisory initiatives adopted in the banking field. Risk factors associated with climate change Climate change risks may be divided into two types: physical risks and transition risks. Physical risks are those that arise when climate change materialises, to a greater or lesser extent. This leads to extreme weather events, a rise in sea levels, desertification, greater risk of wildfires, etc. In the case of Spain, the National Plan for Adapting to Climate Change 2021-20303 suggests that these risks have already started to materialise. Also, according to the European Environment Agency, extreme weather and climate events have already caused direct economic losses in Spain totalling more than € million since 1980.4 The 1  https://www.ipcc.ch/report/sixth-assessment-report-cycle/. 2  Strategy for Financing the Transition to a Sustainable Economy, European Commission, July 2021. 3  Plan Nacional de Adaptación al Cambio Climático (PNACC) 2021-2030, Ministerio para la Transición Ecológica y el Reto Demográfico, September 2020.
While the stress testing element was only part of the CCAR review, it was an important input into evaluating banks’ capital planning. The assessment was conducted between November 2010 and March 2011. Once again the largest 19 U.S. domiciled bank holding companies were asked to participate, using a baseline scenario, their own stress scenario, and a supervisor-provided stress scenario (a set of macroeconomic assumptions consistent with an economic downturn). A critical benchmark was whether banks could meet a 5 percent Tier 1 common capital ratio under stress conditions over the next two years, assuming they paid dividends or carried out the stock buybacks as they proposed. Additional capital measures were examined, including the ability to satisfy over time the new Basel III capital ratios and changes in capital required by the Dodd-Frank legislation. Bank holding companies were required to provide information on their capital adequacy processes and capital distribution policies, and supervisors assessed them. Conducting the analysis for all of these institutions simultaneously gave supervisors a good benchmark as to how the financial institutions were performing relative to a stress scenario. In addition to providing a method for evaluating capital assessments, the stress test that was one component of the broader CCAR provided an opportunity to determine how financial institutions had refined their ability to conduct stress tests and incorporated lessons learned from the SCAP. In that vein, these types of capital assessments are likely to be an important tool in understanding the capital planning process in the future.

Már Guðmundsson: Iceland’s crisis and recovery and the crisis in the eurozone Address by Mr Már Guðmundsson, Governor of the Central Bank of Iceland, in an international panel of bank governors on the European financial crisis and the Israeli economy, the Eli Hurvitz Conference on Economy and Society, Masada, Israel, 28 June 2012. *  *  *  Almost 90% of Iceland’s financial sector collapsed in the first week of October 2008, after its three private cross-border banks failed. In the panic that gripped global financial markets after the collapse of Lehman Brothers, these banks, like so many internationally active banks around the world, were faced with a wholesale run on their foreign currency liabilities and were therefore heading towards a default on those liabilities in the absence of lender-of-lastresort assistance in terms of foreign currency. However, given the size of the balance sheets involved (10 times GDP overall, with over two-thirds in foreign currency), it was impossible for the Icelandic authorities to provide this assistance on their own. Had the government made a full-scale attempt to save the banks, it would have been at serious risk of defaulting itself. The Icelandic banks’ failures were large by any criteria: the largest of them places 4th on the world list of corporate failures, and the three Icelandic banks combined rank 2nd, after Lehman. It was thus an event of systemic proportion in parts of Europe.
The driving forces behind this were a budget deficit that amounted to 2.6 per cent of GDP in 2005, and a large and growing deficit in household saving. Private household saving turned negative in 2005, which was the first time since the 1930s and corresponded to 0.3 per cent of GDP. The US current account deficit is counterbalanced to 40 per cent by the surplus in Asia, particularly China and Japan. The remainder is accounted for by a number of oilproducing countries and a few small, open economies, including Sweden, Norway and Switzerland. Several different explanations have been put forward for the large US current account deficit. The explanation most often highlighted in the United States is that the deficit reflects stronger productivity growth and higher growth potential in the United States, compared with other parts of the world. Many of the investments made in the 1980s and 1990s, particularly IT investments, had substantial positive effects on productivity, after some time lag. When these investments were supplemented by reorganisation and internal training within the companies, they had an even greater effect on productivity. The labour supply has also benefited from substantial labour immigration. According to the OECD, potential growth, that is, how fast the economy can grow without problems arising in the form of overheating, amounts to 3.4 per cent in the United States, with around 1 percentage point being explained by the labour supply. 10 The corresponding estimate for the euro zone is 1.9 per cent and for Japan it is only 1.3 per cent.

It is therefore the expectation of the Bank of Zambia that this Conference will discuss this trend and its implications, particularly with regard to limited accessibility to technology and technicalknow how of consumers in SADC member countries. Other themes I am sure you will deliberate upon include confidentially of financial information, money laundering and terrorist financing. Effective payment system oversight needs to be promoted so that public confidence in the safety and soundness of the national payment systems is maintained. Understandably, this is a new area and in most member countries work is still exploratory. I therefore urge you all to double your efforts in this regard and deliver on this very important central bank responsibility. Ladies and Gentlemen, another new area is that of mobile phone enabled payment services. This development has a huge potential to help the SADC region leap frog a number of financial sector development challenges particularly those related to improving access and availability of financial services. This is because mobile phone based services, particularly those focused on low-value payments where swift and convenient service is the primary goal could be a practical solution for SADC member countries. The challenge therefore is how well we all respond without damaging this sprouting and potentially cost-effective delivery channel for financial services, which can be damaged with over regulation or lack of mitigation for the risks its poses.