samchain/econo-pairs-v1 huggingface dataset:
There is ample evidence that economic and financial informality—albeit a rational alternative for people with little choice—is a major obstacle for emerging economies to grow in a more inclusive way. Thus, while central bankers would normally emphasize that their focus is on short-term macroeconomics and price stability, there is little doubt that a more efficient, deeper and inclusive financial system would make things substantially easier for them and would provide a lasting push for development. What difference can FinTech make? [SLIDE 11] The central bank and commercial banks have been traditionally close because maturity transformation and fractional banking is in the DNA of universal banking, that is, the ability of commercial banks to provide a large set of interrelated services to the public. 7  Central Bank of Chile 29 June, 2017  In contrast, FinTech refers to those technologically enabled innovations in financial services that could result in new business models, applications, processes or products with an associated material effect on the provision of financial services.1 Thus defined, the scope of products or activities that can be catalogued as FinTech is quite broad. Moreover, products or services that are nowadays commonly or massively used could have been considered FinTech, e.g. banknotes, cheques, credit cards, ATMs, and electronic transfers. What makes a difference today is partly the speed at which change is happening and how different developments—programming, encryption, mobile devices—can combine to produce new financial services.

Lawyers, for instance, can be disbarred, and complaints against them can become matters of public record. That is added incentive to maintain the skills, character, and other qualifications required to become (and remain) a member of the bar. And, critically, professions do not stop improving. Lawyers continue—I hope—to seek a more just society. Doctors, a healthier one. I do not mean to call for the equivalent of the legal bar for bankers—although it might not be a bad idea. But there are elements of professions that could be useful. For example, forums like this one facilitate information sharing and promote a sense of community. A code of professional conduct is another example. Again, I refer you to the work of the Banking Standards Board, 5/7  BIS central bankers' speeches  which has developed a “Statement of Principles for Strengthening Professionalism.” Like Bill Dudley, I have argued that banking would benefit from a misconduct database. 15 Records of employee misconduct would be available to future employers to combat the so-called “rolling bad apple” phenomenon. Hopefully this would encourage more careful choices by bankers in the same way that the risk of disbarment prompts lawyers to think about the long-term consequences of their decisions. None of these ideas is a magic bullet. But they may be helpful as you consider how the first line of defense and the financial services industry develop as a profession. Conclusion: professional courage Let me end with one final thought on professionalism.
Alternatively, it is argued that they are so obviously consistent with a ‘standard’ loss function that it does not really add anything to talk about ‘insurance’ or ‘precautionary’ settings as a way of framing policy analysis and decisions. These are both fair points! Possible responses run as follows. First, maybe we (society) are more averse to fairly bad events than to risks that take us just a little distance from target/potential; eg maybe preferences would be better approximated by a loss function with a ‘higher power’ than a quadratic 16 . Second, maybe what is going on can be thought of in terms of how heavily or not we discount future deviations from target/potential relative to very near-term deviations; ie a policymaker may accept the price (premium) of risking slightly higher/lower inflation in the nearish term in order to reduce (insure against) the risk of a bigger or more persistent deviation of inflation from target a little down the road. What the insurance/risk management metaphor does illustrate is that a policymaker has to think beyond the immediate policy decision. Indeed, it would be odd not to. In the great scheme of things, fixing the overnight rate for the next month (in the UK) – or 45 days or so (in the US) – seems neither here nor there. Of course, on both sides of the Atlantic, we have recent examples of policymakers making their strategy clear, albeit in subtly different ways. In the most recent cycle, the Bank of England’s rate troughed at 3.5%.

I hope that the Financial Stability Board Working Group on the Crisis Management Principles will not hesitate to report back to the FSB, and through it to alert G20 Ministers, if implementation is or looks to be stalling – whether because it is meeting with resistance from the authorities or the industry, or blockages in national laws and practices. 8  BIS Review 83/2009  Concluding comment This crisis has reminded a generation of some old truths. Banks can fail. But they matter enormously to our economies, and so the authorities cannot afford to stand back and allow disorderly systemic failure. Going forward, we cannot have a regime where the upside for risk-taking goes to shareholders and management, but the downside falls to the general taxpayer. All three elements of the Social Contract for banking need to be reformed. Better regulation and supervision, including a macroprudential element. Better arrangements for liquidity insurance, which the Bank has tried to introduce alongside our international peers. And, my main topic today, a new regime for resolving bank distress. In particular, banks must structure and run themselves to permit orderly wind down. And they must invest to provide the authorities with the information they need to do so. This will not be easy. And it will not be cheap. Together with higher capital and liquidity requirements – lower leverage and reduced maturity transformations – over time it may well mean a lower headline return on equity for some banks.
We need to solidify our confidence that our ultimate exit from the zero lower bound will occur smoothly – and in a way that sustains our escape from it. A corollary to this is we should not shy away from policy prescriptions that generate forecasts of inflation that moderately overshoot our 2 percent target for a limited time. Such a policy strategy more properly balances expected costs and benefits. And it would leave me with much more confidence that inflation will not stall out below target once we start raising rates. I agree with Atlanta Fed President Lockhart in thinking that we ought to be “whites of their eyes” inflation fighters. 15 The last thing we want to do is regress back into the ZLB. Indeed, such a relapse would be a sign there was something else going on that was preventing the economy from being as vibrant as we thought possible. To summarize, I am very uncomfortable with calls to raise our policy rate sooner than later. I favor delaying liftoff until I am more certain that we have sufficient momentum in place toward our policy goals. And I think we should plan for our path of policy rate increases to be shallow in order to be sure that the economy’s momentum is sustainable in the presence of less accommodative financial conditions. References Aaronson, Daniel, Luojia Hu, Arian Seifoddini and Daniel G. Sullivan, 2014, “Estimating and forecasting trend labor force participation,” Economic Perspectives, Federal Reserve Bank of Chicago, Vol. 38, forthcoming.

There is evidence of increasing wages in some occupations, but wage growth in general continues to be very modest at about 2–1/4 percent per year. That is a long way from the 3 to 4 percent benchmark implied by productivity growth and our inflation objective. Indeed, over the past three years, the unemployment rate has fallen by a percentage point per year; yet real wage growth has barely budged. It’s hard for me to imagine a full labor market recovery without genuine improvement in compensation growth. But am I wrong? Has the wage Phillips curve completely broken down? Some claim the answer is no – you just have to look at the right measure of unemployment. Alan Krueger, Judd Cramer and David Cho, among others, have shown that the relationship between real wages and the short-term unemployment rate during this cycle has been in line with historical norms, whereas the historical spike in long-term unemployment exerted minimal pressure on real wage growth. 10 Of course, the short-term unemployment rate is now close to its pre-recession level. So their model implies nominal wage growth should be returning to something close to the fundamentals implied by productivity growth and inflation. My staff’s research comes to a somewhat different conclusion. Using models similar to those Michael Kiley presented here this morning, 11 they find that pools of potential workers other than the short-term unemployed, notably the medium-term unemployed and the involuntary part-time work force, substantially influence wage growth at the state or metropolitan statistical area level.
A recently published study shows that the tax has worked and actually reduced emissions in Sweden, see Andersson (2019). 18 See Swedish Economic Research Council (2020) 19 See Wagner (2020). 20 In November 2016, the global climate agreement from Paris entered into force. One of its goals is to keep the global temperature increase below 2 degrees and then limit it even further to 1.5 degrees. 15  9 [18]  need to work to ensure that international financial market regulation mitigates the risks of climate-related financial instability, in the same way as central banks have worked to combat other systemically important risks in the financial system.21 What does all this mean for the Riksbank? To answer this, we should start by looking at how the Riksbank’s mandate and activities relate to it. The Riksbank’s mandate is to promote price stability and an efficient and safe payment system. I believe that the different measures the Riksbank can implement fall into three main categories:     Research and analysis Regulation of the financial system Management of the bank’s own balance sheet  Let me now discuss the options available to the Riksbank to contribute to climate adaptation within these three areas. Strengthen research focusing on economic sustainability To prepare for the effects of climate change, it is important for central banks to support and contribute themselves to research that sheds light on the economic consequences of global warming.

Findings show, for example, that an effective climate policy need not be expensive and that allowing for extreme events is inexpensive insurance against substantial but uncertain future climate costs, see Chart 1.22 The blue line indicates that the costs of overestimating the effects of climate change are not particularly prohibitive. This is because the carbon tax is an effective tool to reduce climate change at a low cost. The red line indicates, on the other hand, that the cost of underestimating climate change can be very substantial. Chart 2. Global warming for various carbon taxes. Degrees Celsius 9  9  8  8  7  7  6  6  5  5  4  4  3  3  2  2  1  1  0  0 2020  2060  2100  2140  2180  Temperature without a tax  Carbon tax in the EU (200 SEK/ton)  Global carbon tax (200 SEK/ton)  Global "swedish" carbon tax (1100 SEK/ton)  Source: Hassler et al. (2020)  Chart 2 shows estimates of the global temperature increase in four different scenarios. The first scenario (blue line) indicates what happens if we don’t implement any political measures. The temperature will then have increased by almost 3O C by 2100, and by around 9O C by 2200. The red line show that a carbon tax only within the EU has a very small effect on global warming.
That is dangerous when the starting point for the UK economy, and the shocks to which it is potentially subject to, are very different to our overseas counterparts or indeed the UK’s own recent past. Since the start of the year, UK short-term interest rates have moved in lockstep with those in the major economies, notably the US and the euro area. The correlation of daily changes between them has been around 0.7, a little above its historical average. Common exposures to a slowing global trade cycle can explain some, if not all, of this correlation. But what stands out, for me, are the differences as much as the similarities between the UK, US and euro-area economies. Chart 32 is a simple plot of unemployment against short-term real interest rates in the UK, US and euro area over the past 20 years. You might expect a negative relationship between the two: the lower unemployment, the smaller slack in the economy and the higher the level of real interest rates necessary to prevent inflation rising. This is broadly what you see in the data. Also shown in the chart are the current settings for the UK, US and euro area (the darker dots). The US has low levels of unemployment and, courtesy of a progressive tightening of policy over recent years, a nowpositive – if still low – real interest rate. The euro area is in the opposite place, with a higher level of unemployment and a still-negative short-term real rate.

ISRA focuses on applied research in Shariah and Islamic finance, and provides the avenue for greater engagement between industry players and scholars. In addition, the tax neutrality treatment, has paved the way for the introduction of innovative products such as Ijarah Munthahiah Bithamleek (leasing ending with ownership) and Musharakah Mutanaqisah (diminishing partnership) in home financing, and currency option using the concept of Hamish Jiddiyah (security deposit) and Tawarruq (monetisation). Secondly , foreign Islamic subsidiaries have an important role in enhancing the international linkages of the Islamic finance industry regionally and internationally. Reinforced by a well developed legal, regulatory and Shariah framework and with three decades of experience, our Islamic financial system offers a unique platform as a meeting place between those that require funds and those with surplus funds. Malaysia has the full complement of the financial infrastructure, products and institutions. This is reinforced by the adoption of international regulatory best practices and liberal foreign exchange administration rules. This environment has encouraged the issuance of ringgit denominated sukuk by multilateral institutions and foreign multinational corporations in our market. It has also increased participation of investors in our Islamic financial markets. In a number of the sukuk issuances, the foreign subscribers (other than from Asian region) represent more than two thirds of total  2  BIS Review 146/2008  subscribers. Given the investment opportunities in the East Asian region, there are significant potential business activities, especially in the Asia-Pacific region.
Unfortunately, this came at the cost of significant macroeconomic imbalances: at the start of the crisis, Romania had a sizeable structural fiscal gap (around –8 percent of GDP in 2008), a current account deficit in the double-digit area and high inflation readings. When the crisis hit, there was no other option but to make the necessary adjustments. They appear to have produced the expected results: with the current account deficit below 1 percent of GDP, a structural fiscal position in the vicinity of 1 percent of GDP, and an annual inflation rate currently at 1.2 percent, we can safely say macroeconomic equilibria have been restored. At the same time, the economy resumed its growth at rates that can be regarded as robust when compared with the European performance (around 3 percent in both 2013 and 2014 and an even better 4.3 percent in the first quarter of 2015). As a consequence, the output lost in the first two years of the crisis has been completely recovered. Public debt is currently below 40 percent of GDP and looks set to decrease over the medium-term, assuming fiscal consolidation gains are maintained and the economic growth stays at current levels. Positive developments also occurred in terms of the external debt, whose share in GDP decreased by more than 12 percentage points since 2012, mainly due to the cross-border deleveraging and the near complete repayment of the IMF loan.

John C Williams: Research, policy, and the zero lower bound Remarks by Mr John C Williams, President and Chief Executive Officer of the Federal Reserve Bank of New York, at the Shadow Open Market Committee Spring Meeting, New York City, 6 March 2020. * * * As prepared for delivery Good afternoon. I would like to start by thanking Athanasios for inviting me to participate in this event. It is a real honor to highlight the influence of our esteemed colleague Marvin Goodfriend, an outstanding and original researcher, policy advisor, and friend. Marvin epitomized the role of policy advisor. His research dug deep into the issues, introduced new ideas into the discussion, and developed options for policymakers to consider for the most challenging issues. The fact that we have so many researchers and policymakers here is testament to the importance of his research in shaping the conversations that we are having to this day. Before I reflect more on Marvin’s contributions to monetary policy, I should give the standard Fed disclaimer that the views I express today are mine alone and do not necessarily reflect those of the Federal Open Market Committee or others in the Federal Reserve System. In preparation for what I know will be a stimulating discussion, I’d like to highlight a few of the ways that Marvin changed the conversation in the U.S. about what was then commonly referred to as the zero lower bound on interest rates, or ZLB for short.
11  Jun.22  Figure 3 Inflation Expectations (annual change, percent) Surveys to analysts (1) (2)  Surveys to firms (1) FTS two years out EES two years out FTS one year out EES one year out  10  8  PDES two years out (4) PDES one year out (4) IMCE one year out (3)  10  8  6  6  4  4  2  2  0  0 17  18  19  20  21  22  17  18  19  20  21  22  (1) Response medians are shown. (2) FTS considers the survey for the first two weeks of each month through January 2018. From February 2018 onwards, it considers the last survey published in the month, including the one prior to the June 2022 Meeting. In months in which the survey is not published, the latest available survey is considered. (3) Average of trade and manufacturing medians. (4) Price determinants and expectations Survey carried out on companies by the Central Bank of Chile. Sources: UAI/Icare and Central Bank of Chile.

We continue to believe that this is the path forward for the region, and one that requires our institutions to continue to further deepen our already strong ties in building capacities to manage risks in a more challenging environment. We look forward to closely collaborate with Bank Indonesia and the Bank of Thailand as well as other central banks 1/2  BIS central bankers' speeches  in the region. I would like to thank Governor Veerathai and his team at the Bank of Thailand for the excellent arrangements today and for the warm welcome extended to us. I would also like to express my appreciation to all of you for being with us today to witness this significant occasion by the three members of the ASEAN central banking community. 2/2  BIS central bankers' speeches
Such an adjustment, never easy, requires unprejudiced, honest assessment of the new realities with clear eyes, unencumbered by the defence of previously held paradigms that have lost any explanatory power. Fifth, we must be aware of the gaps that still remain in our knowledge. Our mainstream macroeconomic models still have little to say, for instance, about the non-linear propagation of shocks, the distributional impacts of policies, or how endogenous firm entry and exit can affect economic performance.15 Policy actions undertaken in the last ten years in monetary policy and in regulation and supervision have made the world more resilient. But we should continue preparing for new challenges. The changes that we have discussed, profound as they are, often hinge on one fundamental idea. A natural question to ask is whether such an idea sprang out as a response to a specific policy problem or was rather conceived previously in an entirely different, unrelated intellectual environment, perhaps addressing a different set of problems. It is a question that is especially relevant in economics, when previously held consensus views change. But it is a question that is unlikely to have a precise answer. Let me rather use the 1939 words of Abraham Flexner, the first director of the Princeton Institute for Advanced Study: “Almost every discovery has a long precarious history. Someone finds a bit here, another a bit there.

(2016), “The ECB’s asset purchase programme: an early assessment” ECB Working Paper, no. 1956. 14 Bagehot, W. (1873), Lombard Street: A Description of the Money Market, London: H.S. King. 15 Some move in this direction is presented in e.g. Bilbiie, F., Fujiwara, I. and F. Ghironi (2014), “Optimal Monetary  Policy with Endogenous Entry and Product Variety”, Journal of Monetary Economics, 64: 1-20. 16 Abraham Flexner (1939), The Usefulness of Useless Knowledge, Princeton University Press. 7/7  BIS central bankers' speeches