samchain/econo-pairs-v1 huggingface dataset:
And do so together: the German Federal President warned last month, “Germany cannot emerge from the crisis strong and healthy if [its] neighbours do not also become strong and healthy” i. Of course the same applies to, say, the Netherlands or Austria: selfishness today could come at a high price tomorrow. And let me stress the utmost importance of Chancellor Merkel’s words precisely just yesterday: “This will encourage us to do more in the area of economic policy, in order to further integration of the euro area. We will address this issue in connection with what we call the Recovery Fund for Europe”. A. Our common goals: recovery and repair 1/Supporting growth in the recovery phase is a shared objective for all of us in Europe. There is indeed no magic bullet, and – at the end of the day – the debt inherited from the crisis will need to be financed through growth and through our work. As pointed out by my colleague and friend Governor Ignazio Visco, “adequate investment in education is […] needed to face the uncertainty that surrounds the jobs and the skills that will matter in the future” ii. Yet, in the face of such enormous upheaval such as the Covid-crisis, investment at the national level will inevitably reach its limit.

Mr Carse: The importance of corporate governance in banks  Speech by Mr David Carse, Deputy Chief Executive of the Hong Kong Monetary Authority, at The Year 2000 Millennium Dinner of The Association of International Accountants - Hong Kong Branch, Hong Kong Bankers Club, Hong Kong, on 17 March 2000. *  *  *  Ladies and gentlemen, I am very pleased to be here this evening to speak to the Association on the subject of corporate governance in banks. I have chosen this as my theme both because it is highly topical for reasons that I will explain later and because it should be of particular interest to this audience. The Association plays an important role in the training and promotion of the accounting profession; and accountants are a vital component in corporate governance not simply in their specific role as auditors but also as a source of highly trained directors and managers. I will begin by giving you a brief situation report on the banking sector because this is relevant to the governance issue. Clearly, the situation is looking a lot better than it has done for the last two years. As the 1999 results released so far have shown, the performance of individual banks is by no means uniform. Some have done a lot better than others, depending on such factors as the mix of their business and where they are in the provisioning cycle.
But I think this is a somewhat misleading view as I will explain later. The SSM and the SRM, both components of the Banking Union thus contribute to reducing the negative feed-back loop between banks and sovereigns. One important objective of the SSM Regulation is to improve the quality of supervision and to ensure strong homogenous supervisory standards across the euro area. The essential contribution that European supervision can give to the separation of banks and sovereigns is the build-up of trust in the robustness of banks as stand-alone entities, so that enhanced confidence by their peers can help normalise interbank markets and overcome financial fragmentation. The establishment of the SRM also addresses the problem of breaking the bank-sovereign nexus because the orderly resolution of banks, even large ones, helps to avoid costly rescues by sovereigns that may endanger their own finances. In practice, however, the SSM and SRM may not be sufficient to completely sever the ties between sovereigns and their domestic banks. The effect of SSM and harmonised supervision on trust among banks may be more limited than expected, while the SRM, important for organising orderly resolutions, is limited in the amount of resources it can contribute to recapitalisations. The Bank Recovering and Resolution Directive (BRRD) is in my view the most crucial regulatory change in Europe in relation to breaking the bank-sovereign nexus. It represents a true paradigm change, ending the culture of bail-out and ushering in a culture of bail-in.

Long-term fiscal policy challenges - the role of the Government Petroleum Fund Nevertheless, the Norwegian economy is facing considerable challenges as a result of an ageing population and a marked rise in pension expenses and in the cost of nursing and care services. The number of old-age and disability pensioners is estimated to rise by 50% by 2030, and central government expenditure on old-age and disability pensions is expected to increase from approximately 7% of GDP in 2000 to 15% in 30 years’ time. 3  BIS Review 105/2000  In order to meet these long-term fiscal policy challenges, it is appropriate for resources to be put aside in times of high petroleum revenues. The larger the Petroleum Fund, the less dependent we will be on petroleum revenues in the future. The Norwegian Ministry of Finance assesses the long-term outlook for public expenditure using generational accounts.1 Such accounts can be used to assess whether the tax burden will need to be increased in the future to meet the government’s long-term social security obligations and to maintain public services and amenities. The calculations presented by the Ministry of Finance2 indicate that the generational accounts are more or less balanced. The ministry emphasises the uncertainty shrouding this type of long-term assessment of fiscal policy. Fluctuations in the oil price and petroleum earnings also create challenges for economy policy in the short and medium term. Let us suppose that the oil price temporarily increased by USD 1 per barrel.
Conduct regulators – such as the UK’s Financial Conduct Authority (“FCA”) – have taken an early lead in seeking to ensure that standards for financial advice and services offered are upheld, and that the integrity of the financial system is protected. Second, the twin imperatives of greater inclusion and more competition point to the value of digital identities. Billions of people are still under-or unbanked across advanced and emerging economies. 11  And as the FSB  and others have highlighted, some countries are at risk of being cut off from the global financial system as major correspondent banks withdraw. 12  New technologies are providing solutions. Already, biometrics and cryptography are being used to validate customer identities in consistent and reliable ways, facilitating access to the financial system and reducing AML and CFT due diligence costs. For example, since 2010, the Indian government has issued more than 800 million such identities, such that at least four out of five citizens can now use them to make use of governmental and financial services. 10  Oliver Wyman and Santander estimated that distributed ledger technology could reduce banks’ infrastructure costs attributable to cross-border payments, securities trading and regulatory compliance by $ per annum by 2022. See: https://santanderinnoventures.com/fintech2/ 11 Some 2 billion adults lack a bank account worldwide. 10 million US households and 1.5 million UK adults are also unbanked.

The emergence of mobile telephony, the ubiquity of the internet, availability of high-speed computing, advances in cryptography, and innovations in machine learning could all combine to enable rapid changes in finance – just as they are in other areas of the economy. FinTech’s true promise springs from its potential to unbundle banking into its core functions of: settling payments, performing maturity transformation, sharing risk and allocating capital. This possibility is being driven by new entrants – payment service providers, aggregators and robo advisors, peer-to-peer lenders, and innovative trading platforms. And it is being influenced by incumbents who are adopting new technologies in an effort to reinforce the economies of scale and scope of their business models. In this process, systemic risks will evolve. Changes to customer loyalties could influence the stability of bank funding. New underwriting models could impact credit quality and even macroeconomic dynamics. New investing and risk management paradigms could affect market functioning. A host of applications and new infrastructure could reduce costs, probably improve capital efficiency and possibly create new critical economic functions. The challenge for policymakers is to ensure that FinTech develops in a way that maximises the opportunities and minimises the risks for society. After all, the history of financial innovation is littered with examples that led to early booms, growing unintended consequences, and eventual busts.
This has risen sharply in the past couple of  5  years and to historic highs; it fell back in the most recent,  4  April, data, but remains high. Against the backdrop I  3  have been discussing of slowing global growth, trade  2  tensions and Brexit uncertainty, that is not surprising. 1  But it suggests a policy environment that could  0  potentially be challenging. -1  Many of the drivers of elevated policy uncertainty are  Differences from averages since 2002 (number of standard deviations)  -2 2002  2006  2010  2014  Policy uncertainty  2018 VIX  fundamentally shocks to supply, which monetary policy is not able to offset, rather than demand. But they could introduce a more complicated policy trade-off for the  The policy uncertainty index is available at http://www.policyuncertainty.com/. This chart shows data to end-April. MPC. And they represent risks to financial stability which the FPC needs to be mindful of and prepared to respond to. That is particularly the case given the apparent disconnect between this measure of policy uncertainty and measures of market uncertainty, for example the VIX measure of US equity market uncertainty which is also shown on the chart. The VIX has risen far less than the policy uncertainty index in recent months, suggesting market participants see relatively little risk of major disruption.

If the weakness in finance sector productivity has been a result of households and firms paying down debt – a process which has now largely run its course – then you might  Chart 5: Frequency of mentions of  Chart 6: Sectoral contributions to the  “productivity” in the Inflation Report  slowdown in productivity growth  Mentions per million words  Percentage  ICT  4000  2.5  Prof. & scientific  3500  Finance  2.0  Manufacturing  1.5  3000  Other  2500  Total  1.0 0.5  2000  0.0  1500  -0.5  1000  -1.0  500  -1.5  0 1997  -2.0  2001  2005  2009  2013  2017  1997-07  2008-09  2010-17  Difference (2010-17 minus 199707)  5  All speeches are available online at www.bankofengland.co.uk/news/speeches  5  expect to see an increasing contribution from finance in the coming years, and perhaps also spillovers to professional services and other complementary industries.4 This would help underpin the pickup in productivity growth that we are forecasting at the aggregate level. I am less confident, because I put more weight on the view that pre-crisis growth in finance sector productivity was simply unsustainable. Much of the apparent growth in finance sector productivity before the crisis reflected profits on the risky lending that led to the crisis itself.
This problem was significantly mitigated with the FX swap lines that the US Fed negotiated with the ECB and other major central banks, especially after these became uncapped in some cases. But the problem was not confined to currency pairs involving the US dollar, and a similar kind of dynamic played out for smaller currencies in Europe vis-à-vis the euro, especially where banking systems had significant short-term foreign refinancing needs, or what can also be called rollover risk in terms of foreign currency. In some cases, FX swap lines were granted vis-à-vis the dollar, the euro and the yen, and in some cases not. Where swap lines were granted, it helped. And for some of the smaller players, it might not have mattered terribly much which of the major international currencies they hooked on to in this sense, especially after the uncapped swap lines had been established. What we observed during this peak of the crisis was thus a run on cross-border banking operations. We know how to solve such problems domestically by letting central banks lend to markets and/or institutions through their almost unlimited short-run capacity to expand their domestic balance sheet. However, when it comes to foreign currency, a central bank’s capacity to help banks to refinance the foreign liquidity denied them on the market is limited by the size of its reserves or the willingness of its big neighbours to help. This is what did the Icelandic banks in.

Instead, the Government, on the advice of the Central Bank, announced on 29 September that it was taking a 75% equity stake in Glitnir valued at € m. This implied a big fall from what such a stake was valued at in the market the week before. In the following week, the equity price collapsed further, ending the week 75% below its value at the end of the preceding week. This action did not boost market confidence in the Icelandic banking system. On the contrary, it intensified the run. On the following day, both the sovereign and the banks were  2  Baba, Naohiko, Frank Packer and Teppei Nagano, (2008). “The spillover of money market turbulance to FX swap and cross-currency swap markets”, BIS Quarterly Review, March 2008, 73–86; Baba, Naohiko, and Frank Packer, (2008). “Interpreting deviations from covered interest parity during the financial market turmoil of 2007–08”, BIS Working Papers, No. 267. See also Box III-1, “The recent turmoil in the Icelandic foreign exchange swap market” in the Central Bank of Iceland Monetary Bulletin 2008/1, pp. 26–29. 4  BIS Review 9/2010  downgraded by two notches, followed by widespread margin calls and closing of credit lines. The foreign deposits that had helped to alleviate the foreign liquidity squeeze experienced outflows. And the equity loss involved in the Glitnir takeover created a domino effect within the Icelandic financial system.
A second basic conclusion is that, if the economy is close to the effective lower bound, it is vitally important to adopt especially forceful or persistent monetary policy action to avoid negative deviations from the inflation target becoming entrenched. In turn, this may also imply a transitory period in which inflation is moderately above target. In particular, the review identified forward guidance, asset purchases and longer-term refinancing operations as instruments in the monetary policy toolbox that can help to address the constraint of the effective lower bound on policy rates. At its 21 July monetary policy meeting, the Governing Council revised its forward guidance on policy rates in line with this new strategic orientation. In particular, the new forward guidance specified three conditions that need to be met before we would start raising our policy rates. The first condition is that the Governing Council “sees inflation reaching two per cent well ahead of the end of its projection horizon.” The second condition is that the two per cent target is reached 1/2  BIS central bankers' speeches  “durably for the rest of the projection horizon.” The third condition is that the Governing Council “judges that realised progress in underlying inflation is sufficiently advanced to be consistent with inflation stabilising at two per cent over the medium term.” Let me highlight today two key features of this rate forward guidance.

Philip R Lane: The monetary policy toolbox and the effective lower bound Welcome address by Mr Philip R Lane, Member of the Executive Board of the European Central Bank, at the ECB Conference on Monetary Policy “bridging science and practice”, Frankfurt am Main, 11 October 2021. * * * It is a pleasure to welcome you to the 2021 edition of the annual ECB Conference on Monetary Policy. As captured in the title of this year’s event, this conference series serves a vital role in bridging the science and practice of monetary policy. In particular, it is essential for the ECB to incorporate in our analytical framework the theoretical and empirical insights generated by the global academic community, and the conference format (albeit in webinar mode again this year) is very effective in providing us with a platform to discuss the latest developments. The breadth of academic research (in terms of both topics and research techniques) that is relevant for monetary policy is quite wide and this is reflected in the composition of the conference programme. The agenda includes research that exploits financial market data to examine the transmission of monetary policy, studies the impact of the pandemic on firms and banks using entity-level datasets, analyses the interactions between monetary policy and financial stability in a full-scale macroeconomic model, and explores the impact of monetary and fiscal policies on the formation of household expectations.
A country with such challenges should not and actually – given our euro area membership and the background of market globalisation – cannot pursue any economic policy avenue other than one which, firstly, provides for and boosts higher employment growth or, on the other side of the same coin, brings about swifter and more sustainable gains in our productivity and competitiveness; and, secondly, helps curb the growth of our public and private debt with a view to subsequently reducing it. In economic policy, hits and misses only become clearly manifest after some time. Just like big vessels which, owing to their great inertia, can only change course or speed slowly, an economy such as ours also moves with considerable inertia: correcting mistakes takes time and, almost always, entails losses in income and well-being, and social instability. Our experience – both in the pre-crisis expansionary phase while the imbalances were accumulating and during their correction and the recovery of growth – should help us avoid errors, persevere with reforms to safeguard and enhance our competitiveness, and fulfil our public finance commitments in the European Union. Thank you. BIS central bankers’ speeches  5

Our central projection, on the basis that there are reasonable grounds to expect the US to return to moderate growth in the latter part of this year, is that the impact on the UK from the weakening of global activity should be moderate. But we judge that the risks are weighted on the downside, principally on the basis that the pause in US growth could be deeper or more prolonged than expected. Domestically, on our central projection we see reasons for domestic demand to remain fairly well sustained. Overall, therefore, our central projection is for some slowdown in UK growth, to around 2% in the latter half of this year, reflecting the deterioration in global prospects, but thereafter a recovery in growth to around its trend rate as world activity recovers. In parallel, we project RPIX inflation running around 2% through this year, but picking up to reach our target of 2 1/2% at around our two-year forecast horizon. On this basis, recognising that the risks are clearly on the downside of the central projection, we implemented a modest reduction in rates, from 6% to 5 3/4%, in February. Decision-making under conditions of uncertainty lies at the core of any business activity, so I was once taught, and that is just as much true of our job on the MPC as for yours. We all of us get used in our professional lives to looking through a glass darkly.
BIS Review 43/1998  -5-  •  •  But despite these efforts at crisis prevention, crises may continue to arise from time to time. In this regard, the Interim Committee also reaffirmed both the central role of the Fund in crisis management and the need to develop more effective procedures to involve the private sector in forestalling or resolving financial crises.2 Finally, as I have already alluded, the Committee reaffirmed its view that the time has come to add a new chapter to the Bretton Woods Agreement by making the liberalization of capital movements one of the purposes of the Fund and extending, as needed, the Fund’s jurisdiction for this purpose. It requested the Executive Board to pursue its work on this issue with determination, with the aim of submitting an appropriate amendment of our Articles of Agreement as soon as possible. Greater transparency and availability of economic information, adoption of standards and dissemination of best practices, a continuous strengthening of IMF surveillance, the orderly liberalization of capital movements, and better private sector involvement in crisis prevention and resolution - taken together and utilized to their full potential - these first five pillars could be a very significant contribution to a new financial architecture much more attune to dramatically modernized and globalized markets. I have no doubt the G-7/G-8 leaders in Birmingham will invite us to build on this basis.

Mr. Camdessus shares his views on a new financial architecture for a globalized world Address by the Managing Director of the International Monetary Fund, Mr. M. Camdessus, at the Royal Institute for International Affairs in London on 8/5/98. The G-7/G-8 Summit will be held in Birmingham next week. High on the Summit agenda will be the issue of how to renovate the architecture of the international financial system in the face of the tremendous changes under way in the global economy. The Asian crisis has been so unexpected in many of its aspects, so broad, so cruel in its human consequences that even before the crisis has run its full course - the leaders of the world want to embark on the design of a new architecture. This is certainly the right thing to do, and the venue of this meeting could hardly be more fitting. Like many other cities in advanced countries, Birmingham has experienced the forces of change in the global economy first hand - from the loss of traditional industries to the challenge of finding new employment opportunities. Moreover, two centuries ago, this city was at the heart of the Industrial Revolution, an era that, like our own, was a time of extremely rapid change. At that time, intellectuals of all schools of thought used to meet frequently in Birmingham - every full moon, I understand - and bring their reflections to bear on the challenges of their new world.