samchain/econo-pairs-v1 huggingface dataset:
The aspect that impresses me most about this group is the virtually universal consensus on global economic issues. There is a broad consensus at the level of the G 20 on the diagnosis of the crisis. There is a broad consensus on the appropriate response to the crisis. And there is a broad consensus on the direction of financial sector reform, along with the main ideas that I described a moment ago. There is agreement that macroeconomic policies at the domestic level need to be consistent with the objective of global financial and economic stability. Medium-term and long-term sustainability in domestic macroeconomic policies will have to prevail. A renewed mediumterm perspective should guide macro-economic policies from now on. Like financial regulation, policies should not amplify economic fluctuations. Structural reform As I said, structural reform is ultimately the responsibility of individual economies. The crisis has reduced some of the imbalances almost automatically. In the euro area, economies with wide current account imbalances – including Spain – have suffered relatively more than others. As a consequence, output and employment losses in these countries are acting as potent stabilisers to re-absorb long-standing gaps between domestic savings and domestic investment. As Miguel Fernández-Ordóñez has said, some structural weaknesses have been revealed even more clearly and call for appropriate reforms. Spain was on a pattern of growth in the run-up to the crisis that was not sustainable.

5  All speeches are available online at www.bankofengland.co.uk/speeches  5  I do not want to go into this in detail today. But we should not lose sight of the fact that reforms to the banking system, particularly substantially stronger capital and liquidity requirements have bolstered, albeit indirectly, the resilience of the CCPs. 6  Equally, if not more important, the resolution regimes now being implemented in major jurisdictions are intended precisely to ensure that a major bank can fail, without the disruptive systemic impact of insolvency and default - including default to the clearing house. The objective is that debt holders can be bailed in and liquidity provided to restore the bank to solvency enabling it to continue to meet its obligations. I will return later to the question of how we can have assurance that bank resolution will operate effectively. The point I want to stress here is that if a major bank fails, effective resolution should prevent default to the CCP occurring in the first place. The CCP’s own defences  Stronger banks and effective resolution regimes reduce significantly the risks that CCPs face from member default. But they do not eliminate it. Like banks, CCPs need to hold resources to absorb default losses. But unlike banks the great majority of these resources are not the capital of the owners. It is the resources of its members because it is the counterparty risk of the members that is being managed.
Policymakers around the world should focus their actions on dealing with elevated uncertainty and rising inflation, while safeguarding growth prospects. The CBC remains alert in gauging these challenges, as proven by our actions that safeguarded depositors and public finances with the controlled transaction relating to RCB and also on the client onboarding digitisation project we are close to launching on our own initiative for the benefit of the economy, It is up to us to come through these challenges unscathed or even stronger, wiser and better prepared for the future because the world geopolitically, economically and financially is changing fast in fundamental and lasting ways. We have done it before, we can do it again. 5/5  BIS - Central bankers' speeches

And the balance that assesses households’ views about “whether it is a good time to make a major purchase” has also fallen back substantially since the start of the year – although that is likely, to some extent, to reflect the impact of the rise in VAT. Chart 8 Measures of consumer confidence Optimism over the next year(a) Good time to make a major purchase? Balance 40 30 20 10 0 -10 -20 -30 -40 -50  1985  1990  1995  2000  2005  2010  Source: Research carried out by GfK NOP on behalf of the European Commission. (a) Average of the questions on households’ current financial situation, and the general economic situation, over the next 12 months. Other factors, such as the ongoing restrictions on the availability of credit and households’ concerns about their levels of debt, may also contribute to the likely weakness of household spending going forward, by encouraging households to save more and spend less, for a given level of income. Overall, given the continuing squeeze in household real incomes and the renewed fall in consumer confidence, I wouldn’t be surprised if there was only slow growth in consumer spending over the next year or so. The risks around that are probably skewed to the downside. Even if we do get the anticipated boost to net exports, overall growth in output is unlikely to be much above its historical average rate.
Research at the Bank exploits micro-level information to give more insight into NBFIs portfolio decisions, in the hope of better understanding how spreads and premia will evolve. The confluence of, on the one hand, better data resulting from post-financial crisis increased regulatory scrutiny of NBFIs and a shift towards more centralised and transparent trading at CCPs and, on the other hand, greater computing power and advances in data analytics has permitted a much more disaggregated assessment to be made. Studies have identified more precisely the ‘preferred habitats’ of various NBFIs across the spectrum of available assets, as well as the cascades of asset sales underlying the so-called ‘dash-for-cash’ at the outset of the pandemic. [14] Better understanding the financial frictions that explain these features of portfolio choices and market behaviour is central to developing a more structural view of monetarist channels in the transmission mechanism of monetary policy. After all – and as Lord King identified two decades ago – if monetary quantities affect the magnitude and incidence of transaction costs in financial markets, they will influence spending and pricing decisions – and thus inflation – via channels that are not captured simply by changes in policy rates. Understanding those frictions and how money can alleviate them constitutes the route to developing a structural understanding of QE transmission. Page 11  At the macroeconomic level, we are still some way short of having that structural view.

These long and short-term risks are, of course, linked – any overall misalignment with climate goals increases the short-term risks from a disorderly transition, possibly caused by extreme weather events or abrupt shifts in climate policy. A system-wide stress test can help supervisors and climate policymakers judge the adequacy of the current transition and whether further actions could be expected. As the Bank of England considers the timing and design of such a stress test, we are working with colleagues in the Network for Greening the Financial System (NGFS) to develop a small number of highlevel scenarios.16 And in our Climate Financial Risk Forum we will work with banks, insurers and asset managers to ensure these scenarios are rolled out effectively within their organisations. Together with our work on this year’s insurance survey, these initiatives will provide a basis for our future assessments of the system-wide exposure to climate risks. The third and final area is return A new horizon brings new opportunities. The IEA estimates that the low-carbon transition could require $ in energy sector investments every year for decades – twice the rate at present. Under their scenario, in order for carbon to stabilise by 2050, nearly 95% of electricity supply will need to be low carbon, 70% of new cars electric, and the CO2 intensity of the building sector will need to fall by 80%. With an estimated $ trillion of infrastructure investment expected between 2015 and 2030, smart decisions now can make sure that investment is both financially rewarding and environmentally sustainable.
Fast economic growth does not happen without shaking a society's economic, social, cultural, political and institutional equilibria. This 'shaking' is both a condition and a consequence of  economic acceleration. It is both an effect of economic, social, cultural, political and institutional disruption and a cause of economic, social, cultural, political and institutional disruption. This is not a moral judgement; it is a statement of what I believe is a sober understanding of the state of affairs. In the well-known words of the Foreword to the Second Edition of Liquid Modernity, the late Zygmunt Bauman, remarks that “Forms of modern life may differ in quite a few respects – but what unites them all is precisely their fragility, temporariness, vulnerability and inclination to constant change.” Bauman’s “liquid modernity” is characterised by, I quote him, “the growing conviction that change is the only permanence, and uncertainty the only certainty. A hundred years ago 'to be modern' meant to chase 'the final state of perfection' -- now it means an infinity of improvement, with no 'final state' in sight and none desired.” Of course Joseph Schumpeter, almost sixty years before (and he was not the first one), had already emphasised the centrality of the disruptive process of transformation that characterises modern economic reality. He described it as “…by nature a form or method of economic change and not only never is but never can be stationary.

[...] The fundamental impulse that sets and keeps […] (it) in motion comes from the new consumers’ goods, the new methods of production or transportation, the new markets, the new forms of industrial organization […] (as a) process of industrial mutation that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one.” When confronted with this state of affairs – a state of affairs that is admittedly disquieting and unsettling – the worst possible reaction is to retreat into nostalgic denial, and to pretend that we are living in temporary blips of disequilibrium, in exceptional situations, that will at some unspecified point in time revert to a blissful state of economic, social, cultural, political and institutional equilibria. The only reasonable approach is to endeavour tirelessly and to the best of our technical ability to navigate a reality that is complex, characterised by change and prone to crises. If there is no going back, then going forward we can only go forward. Navigating this reality requires us to be constantly vigilant to the risks involved, a task that requires us to understand reality and to deal with it to best of our technical competences. Change brings with it challenges and opportunities, which challenges and opportunities easily morph into each other, and generate further challenges and opportunities. Page | 10  Of course, the financial system, like any other, cannot reduce risk to zero.
Likewise, the preparations and hard work that we undertake today to prepare for Basel II will, at the same time, strengthen the financial and supervisory infrastructures in our countries more generally, even before we implement Basel II. These preparations are important in helping to ensure the effectiveness of our supervisory systems, to enhance the transparency of our markets, and to develop the sense of a risk management culture in the industry. Together, they will contribute to the promise of greater financial stability in our markets. That is surely a goal worthy of the preparations we will demand of our banks, of our markets, and of our own agencies. We must recognise that, just as banking is becoming an increasingly complex business, the job of bank supervisors will only become more challenging in the coming years. To promote sound banking and risk management practices on a national, regional, or global level, we will need to work together and cooperate even more in the future. Your participation in this conference speaks to your interest in finding ways to deepen our cooperation as we move into this next journey for supervisors. “El trabajo compartido es mas llevadero,” as we say in Spanish: “Many hands make light work” - and, looking around this hall, you will see many hands ready to cooperate. And so, in closing, I encourage you to make the most of this unique opportunity to build contacts and working relationships and to share views on how we can work together toward greater financial stability in the future.

In recent years, supervisors have begun to move more generally toward a system of supervision that encourages prudent risk-taking through the offering of incentives rather than simply enforcing compliance with rigid rules. Internationally, the 1996 Market Risk Amendment to  2  BIS Review 52/2004  the existing Basel Accord represented the first time that banks received explicit capital benefits for developing more sophisticated measures of risk, in that case market risk. Basel II continues this trend by extending incentives to the treatment of credit risk and operational risk. 2.3  Basel II embraces both trends  By stepping back a bit from Basel II’s formulas, we can see that the new capital framework builds on two important trends to incorporate a new philosophy for banking supervision. It combines a riskfocused approach to supervision with incentives for prudent risk-taking into a coherent policy objective that seeks to promote adequate capitalisation. By incorporating in all three of its pillars clear incentives for banks to improve their management of risk, Basel II reinforces management’s focus on control structures. •  For example, in Basel II’s minimum capital requirements - or Pillar 1 - regulatory capital charges are aligned more closely to a bank’s own measures of risk. This creates immediate incentives for banks to improve those measures. •  Likewise, Pillar 2 - supervisory review - emphasises that responsibility for evaluating capital adequacy lies with a bank’s management.
This is due to the great regulatory steps taken recently by the state which helped establish a solid base for  BIS Review 59/2006  5  sustained growth. What we have heard recently of huge initiatives and projects in the oil, gas, petrochemical, mining, transport, electricity water sectors and infrastructure projects in housing, education, and health, would indicate the size and momentum of the coming economic expansion which will be accompanied by a notable rise in the per capita income. It is expected that the private sector will have a greater role in these projects and in the pace of the overall activity. Thus, the financial and banking sector is entering a very dynamic and exciting phase with acceleration in all areas. There are new players, new market opportunities, a range of new products and services, and significant growth in traditional services. The financial sector should be able to fully leverage its tradition of openness and liberalization, its large investment in technology infrastructure, internal control, and development of its manpower. It is entering a new era of increased consumer participation and awareness, greater competition, enhanced transparency and strong supervision and corporate governance. The financial sector is in a strong position to rise up to these challenges and meet the demands of a rapidly growing economy and consumer expectation. I emphasize my wishes and expectations that the Saudi Financial Sector will continue to be a leader and a major player in the domestic and regional economic activity. I thank you for your attention.

First, not enough was done to reflect changes in business models in disclosure regimes and practices. In some distant world, banks in, say, Germany were exposed largely to German companies and households; and similarly Californian banks to Californian borrowers and projects. So if conditions deteriorated in Germany, California or wherever, the markets would be alert to the need to scrutinise the “home” banks operating in those regions or sectors. In today’s world, the markets knew that risk really had been dispersed. But they did not know where it might be concentrated; and, crucially, did not know how or how far it might flow back to the banking sector and so towards the core of the payments system that supports our  BIS Review 77/2008  1  monetary economy. It is in the interests of banks themselves – and certainly in the interests of their creditors and shareholders – to make those risks clearer in future; and if they do so, they will face stronger incentives to avoid risk concentrations. But my second point is that talk of the shift to “Originate & Distribute” can be overdone. Many of the largest global banks seem to have occupied a half-way house. They retained large positions on what amounted to a view that macroeconomic conditions could never get so bad as to cause material impairment, but booked them to portfolios that were marked-to-market (or to models).
The purpose of this rigorous exercise is threefold: •  to foster transparency about the condition of the European banking system;  •  to take the needed corrective actions;  •  and finally to restore confidence. Of course, this exercise is a challenge. But I think that it is also a great opportunity for European banks to show that they have cleaned up their balance sheets and that they are trustworthy. As you can see, the SSM is well on track and I am fully confident that it will be operational at the end of this year, as expected. But this good result should not lead to forget that for the banking union to be fully successful, the SSM needs to be completed with the adoption of a Single Resolution Mechanism. Indeed, in line with my colleagues at the ECB, I consider the Single Resolution Mechanism to be another essential pillar of the banking union, alongside the SSM. Ideally, the SRM should consist of three main elements: a single system, a single authority and a single fund. This is why the ECB has constantly been encouraging all the relevant parties to make further progress in adopting the SRM, which should be in place by the time the SSM becomes operational. You know that a political debate is taking place currently between the European Council of Ministers and the European Parliament.

It was the vicious circle that developed between the state of a country’s banking sector and its perceived sovereign credit quality. And why did this vicious circle emerge? Because of the lack of banking union: •  In a monetary union, capital can circulate freely and rapidly from one country to another, which can amplify the potential fallout from “banking panics”, unless there  BIS central bankers’ speeches  1  are effective supranational mechanisms in place for supervision, resolution and the guarantee of deposits; •  As long as the financial health of the euro area remains at the mercy of the difficulties encountered by one of its member countries, there is a threat that negative interactions may develop between sovereign credit risk and banking risk;  •  In reality, the lack of a banking union allowed a high degree of fragmentation to develop within the euro area banking system and this, in turn, nourished doubts about the “singleness” of the euro. The crisis thus made it clear that a uniformly healthy financial system was vital to safeguard the stability of the euro area and ensure the effective transmission of a single monetary policy. Once we had agreed on this reasoning, we had to come up with a concrete solution. The key to banking union can be summed up as follows: the aim is to find a way to ensure that banks in the euro area are considered precisely as that, as “euro area banks”, and not as “Irish”, “German” or “Italian” banks.
Before explaining how we designed and executed the consolidation process, I thought I should share with the distinguished audience, the basis and the background to this process, which was designed to re-organise the structure in the financial system within the existing legal framework, while taking into consideration some global experiences. In this regard, I will talk on four areas: the role of the Central Bank; evolution of our financial system; global experience in consolidation; and the transition of the burden of financial crises from shareholder to tax payer. Basis 1: Central Bank’s role in financial sector consolidation I would like to begin by explaining the role of the Central Bank in this process. As you all know, securing financial system stability is one of the core objectives of the Central Bank. In terms of Section 5 of the Monetary Law Act, the Central Bank is empowered to ensure financial system stability in the country. The importance of maintaining a sound banking system was also emphasised in the “Report on the Establishment of a Central Bank for Ceylon” by the Central Bank’s founding Governor, John Exter. There he said, I quote, “Banking is an economic activity which affects the public welfare to an unusual degree, it touches in one way or the other almost every phase of the country’s economic life. Sound banking is essential to a healthy and vigorous economic development”.

However, we are still far from attaining the employment levels prior to 2008. The second notable feature is that our recovery, which has been intense and prolonged, is proving compatible with the correction of the imbalances that emerged in the years running up to the crisis; in particular, it is proving compatible with the maintenance of a substantially positive external balance. 4/6  In 2017 we posted a current account balance of around 2% of GDP, a figure not far removed from that observed in the four preceding years. Admittedly, transitory or temporary factors – such as low oil prices and low interest rates, for instance – have exerted an influence on this surplus; but largely it is due to gains in external competitiveness and also to the reduction in the economy’s financing costs, a development in which the Eurosystem’s monetary policy has played a crucial role, as have the structural reforms made since 2011. Outlook On the latest Banco de España projections, which we published last December, the current upturn may be prolonged over the coming years with significant growth in activity and employment, albeit at lower rates than those observed in the last three years. This moderation in the increase in activity would be firstly attributable to the lesser momentum of demand-side policies. Specifically, we expect the impulse derived from fiscal and monetary policy to be lower, as well as lower growth of private consumption compared with that in recent years.