samchain/econo-pairs-v1 huggingface dataset:
In general, blue-collar workers' wages have increased more slowly that those of white-collar workers and wages in the local government sector have increased more slowly than those in the private sector, while wages in central government and regional government have developed relatively well. Relative wage changes are perhaps the most difficult wage formation issue in a low inflation economy, as the social partners must be able to manage wage imbalances between different groups' wage situations without generating a wage spiral. Employees do not merely watch real wages, but also their relative wages, which were previously institutionalised with earnings development guarantees built into the agreements. Previously, high inflation facilitated relative wage changes, but in a low inflation regime it is more difficult for a group to raise its wages as it must entail other groups receiving lower nominal rises and perhaps no real increase. At the same time, one must be aware that relative wage changes are a necessary element in a market economy. There is currently a shortage of labour in health and welfare, so from a labour market perspective it is natural that this shortage will be expressed in higher relative wages in these areas. Larger retirement pensions combined with a greater need for care services over a longer period due to demographic developments will aggravate this labour shortage in future.

This time, nurses and teachers were the first onto the field with regard to wage bargaining and they signed 5-year agreements, which roused some concern that high wage agreements stemming from the favourable demand situation would spread to the rest of the labour market. The average level of the wage agreements in the economy was around 3 per cent, which is slightly higher than the previous bargaining round in 1998, when the agreements came out at around 2.6 per cent. However, it shows that the social partners have moved closer to a non-inflationary wage agreement, despite the fact that economic activity was high when the bargaining rounds began in autumn 2000. Why has the rate of wage increase been subdued over the past decade? Studies made by the Riksbank show that the slowing down in the rate of wage increase during the 1990s was primarily due to the fact that the formulation and organisation of monetary policy had led to lower inflation expectations (since 1996 inflation expectations among the social partners have  1  See, for instance, Nils Elvander, "Industriavtalet och Saltsjöbadsavtalet - en jämförelse" (The industrial agreement and the Saltsjöbaden agreement - a comparison), Arbetsmarknad & Arbetsliv No. 3, 2002, pp. 191-204. 2  Gösta Edgren, Karl-Olof Faxen & Clas-Erik Odhner, Wage Formation and the Economy, Allen and Unwin, 1973. 3  The National Mediation Office, "Avtalsrörelsen och lönebildningen 2001" (Bargaining rounds and wage formation 2002), annual report from the National Mediation Office, 2002.
It is likely, though, that the flexibility of the króna has facilitated adjustment to severe downturns under certain circumstances, such as the collapse of the herring stocks in the late 1960s and the steep contraction following the 2008 financial crisis. The possible reasons for this are explored in the above-mentioned chapters. It is too soon to draw any final conclusions, however, and research beyond the scope of this report or conventional economic analysis is needed in order to shed light on why the objectives of low inflation and economic stability seem so elusive in Iceland, and why undisciplined stabilisation policy and an environment of loose financial regulation and supervision was allowed to flourish during the pre-crisis years. However, as is pointed out in the report, the ineffectiveness of independent monetary policy and the possible procyclical influences of floating currencies are not uniquely Icelandic phenomena, nor are they due solely to flawed stabilisation policy. To some extent, they can also be attributed to exchange rate volatility where, as with any other asset price, expectations and speculation play an important role. In addition, there are indications that smaller countries have more difficulty than large ones in pursuing independent monetary policy while they are becoming more integrated globally. In this context, it is worth noting that, prior to the financial crisis, Iceland was by far the smallest country in the world with a floating currency. Further discussion of the possible reasons for small countries’ vulnerability to such problems can be found in Chapters 9 and 13.

And given the lack of momentum from private and public sectors, U.S. growth will likely remain low for an extended period of time. While economic data releases have pointed time and again to delayed consumption spending and persistently high unemployment, available fiscal and monetary policy space seems to be quite limited. On the fiscal side, further stimulus will be constrained by the promised cuts in federal spending that accompany the recent raise of the U.S. debt ceiling. On the other hand, the Fed’s commitment to maintain the federal funds rate “exceptionally low” at least through mid-2013 should remind us that, in order to be even more accommodative, the Fed might need to rethink and come up with some creative policy actions – probably something that is much more creative than the recent “Operation Twist” that seems to disappoint many market participants. The fact that the U.S. government and the Fed are running out of traditional policy “bullets” leaves one only to wonder what the government and the Fed will do in the face of future shocks. And if they eventually resort to “creative” policy actions, the implications of their policies on the global economy can be quite unpredictable. Across the Atlantic, the Eurozone is also struggling with their sovereign debt crisis, which only deepens and intensifies as time passes. Over the past few months, we have seen some Eurozone member countries that are unwilling to collaborate fully, let alone going the extra mile, to get the problems solved.
Despite signals of partial recovery in domestic economic activity as of May, we continued rate cuts until November 2009 in view of the ongoing uncertainties pertaining to the strength and sustainability of the demand recovery and also anticipating that it would take a considerable period of time before economic activity recovers and employment conditions would improve. The policy rate cuts were terminated in December 2009, due to stronger perceptions that economic activity had started to recover. Thus, the policy rates were cut by a total of 1025 basis points since November 2008. Monetary Policy Committee’s Policy Rate Decisions in 2009 Policy Rate Decision  Policy Rate  (Percentage point)  (Percent)  January 15, 2009  -2.00  13.00  February 19, 2009  -1.50  11.50  March 19, 2009  -1.00  10.50  April 16, 2009  -0.75  9.75  May 14, 2009  -0.50  9.25  June 16, 2009  -0.50  8.75  July 16, 2009  -0.50  8.25  August 18, 2009  -0.50  7.75  September 17, 2009  -0.50  7.25  October 15, 2009  -0.50  6.75  November 19, 2009  -0.25  6.50  December 17, 2009  No Change  6.50  January 14, 2010  No Change  6.50  February 16, 2010  No Change  6.50  March 18, 2010  No Change  6.50  April 13, 2010  No Change  6.50  Meeting Date  Source: CBRT. 39.

Consumer Loans and Credit Card Claims (Real Quarterly Percentage Change, End Values) 2008  Consumer Loans  2009  III  IV  I  II  III  IV  6.0  -5.0  -0.7  2.0  2.0  2.2  Housing  3.5  -4.4  -0.6  2.0  2.5  3.4  Automobile  -0.5  -11.9  -10.5  -4.9  -5.7  -7.1  Other  9.6  -4.5  0.5  2.9  2.5  2.1  Credit Cards  6.6  -0.4  -3.3  5.0  1.7  -1.9  Source: CBRT. 25. Measures taken by the Central Bank to maintain financial stability and to promote the functionality of credit markets had favorable impacts on credit markets during the crisis. Policy rate cuts and stabilizing liquidity measures were reflected on credit rates and this contributed to the easing of financial tightness. Especially as of the second half of 2009, with the decline in credit rates, the uptrend in credit volume became more pronounced. Distinguished Guests, 26. The comprehensive fiscal incentive policies implemented to alleviate the effects of the global economic crisis caused fiscal deficits and debts stocks to soar globally, primarily in advanced countries. Additionally, the decline in tax revenues consequent to the contraction in economic activity accelerated the increase in budget deficits. 27. In parallel with the global rise in government fiscal balances, the ratios of budget deficits and debt stocks to national income also soared in Turkey in 2009.
In addition to the international trade channel, what we should be even more concerned about is higher financial market volatility. While market sentiment on the U.S. and the Eurozone will determine the direction of capital movements, we anticipate volatile capital flows into Asia given the region’s continued strong growth prospects compared to advanced economies. Over the period ahead, capital inflows into Thailand also owe to the fact that monetary policy in advanced economies will likely remain exceptionally easy, which means excess global liquidity and capital inflows into emerging markets. The third channel that the U.S. and the Eurozone crises may affect the Thai economy is through inflation. Generally speaking, global demand slowdown will likely lead to lower oil and commodity prices, hence the lower imported price pressures. So in contrast to the first two channels, this is a positive one. Nevertheless, domestically, as the flood situation improves, public and private spending will pick up thanks to reconstruction spending and fiscal stimulus. This, coupled with inflation expectations that will remain high over the months to come, points to significant upside risks to inflation that will need to be monitored. Ladies and Gentlemen, Given enormous challenges both at home and from abroad, moving Thailand forward will require policymakers to utilize a wide range of policy instruments at their disposal. At the very least, it is crucial to ensure a proper, integrated conduct of fiscal and monetary policies.

Provided that the flood situation starts to improve by early December, we should see Thailand staging a respectable comeback on the back of domestic demand revival. We expect private consumption to rebound as early as the first quarter next year, and investment to regain its firm footing by the second. This will be made possible by pushes from reconstruction spending and fiscal stimulus, both through the government’s direct spending and additional measures. And in particular, higher investment on developments of flood warning and prevention systems is also urgently needed, both to prepare Thailand for future flood incidents and to restore foreign investors’ confidence. I would like to stress again that Thailand’s fate will depend upon her success in reviving domestic demand, given that the problems in the U.S. and the Eurozone are still far from resolved and are expected to last well into the next year and beyond. Early resolution of the  BIS central bankers’ speeches  1  U.S. and the Eurozone crises will rejuvenate the now-sluggish global growth momentum, and this will benefit Thailand by allowing her exports to work with domestic demand in driving growth. But if the opposite happens, then it is likely that another global economic slowdown, even a global recession, is coming underway. Ladies and Gentlemen, This leads us to our second focus today on developments in the U.S. and the Eurozone, along with their implications on Thailand’s outlook going forward. Serious structural concerns continue to threaten the health of the U.S. economy.
Our data indicate that, in recent quarters, borrowers are becoming less likely to fall behind on their mortgages, so fewer households are now entering the foreclosure process. At the same time, though, major lenders have acknowledged serious problems in the processes they have used to repossess homes and announced moratoria on new foreclosures. Taken together, these developments suggest that the situation in housing remains uncertain for the foreseeable future. The Federal Reserve actively encourages efforts to find viable alternatives to foreclosure, like loan modifications, or deeds in lieu. We also support due process and access to legal counsel for homeowners facing foreclosure, for instance through legal aid programs. At the same time, it is important that foreclosures that properly comply with state and federal law can ultimately take place, as this is a necessary part of the adjustment that will eventually return us to more normal conditions in the housing market. At present, the extent of the documentation problem and its wider ramifications are still uncertain. In conjunction with the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation, the Federal Reserve is therefore seeking to establish the facts through a review of the foreclosure practices, governance and documentation at the major bank mortgage servicers. We want to ensure that the housing finance business is supported by robust back-office operations – for processing of new mortgages as well as foreclosures – so that buyers of homes and investors in mortgage securities have full confidence in the process.

In addition, much of our region was spared the worst effects of the non-prime mortgage boom and bust. There was generally lower penetration of nonprime loans into our housing markets, and in general, our region shows better performance, with fewer delinquencies and foreclosures. This pattern was particularly true across Upstate New York. However, as can be seen on the New York Fed’s U.S. Credit Conditions maps, there are significant pockets of housing distress around the greater New York City metro area, especially in communities in the Bronx, Dutchess County and Long Island. Indeed, we recently documented the severity of problems on Long Island in our Facts and Trends publication. Moreover, New Jersey had non-prime mortgage activity closer to the national average and now has more delinquencies and foreclosures than is the case for much of the region. As the uneven pattern of nonprime lending suggests, the region is hardly uniform. The housing section fared better in Upstate New York than it did in much of the region during the  4  BIS Review 137/2010  recession. In fact, the housing boom and bust largely bypassed Upstate New York, where construction activity is a relatively small part of the overall economy. Relative to Upstate New York, most areas in downstate New York and northern New Jersey more closely tracked the national cycle. Sales activity and home prices ramped up during the housing boom, but then dropped sharply. More recently – over the past year – home sales and prices in the region have followed different paths.
Over the next 20 years, Asia will continue to surge, led by the re-emergence of India and China, and a revitalised ASEAN. Japan, will remain an important player in Asia. However, as a mature economy, Japan is not expected to grow as fast as India and China. This evening, I will focus on India, China and ASEAN in-between. India on the march First, India. Prime Minister Manmohan Singh said on India's Independence Day this year that India is "certainly on the march". The Prime Minister is a modest man who is not given to exaggeration. Today, India is attracting attention from foreign investors and world leaders alike. Over the past 12 years, India grew by an average of 6.5% per year. Growth was even higher, at 8% per annum, over the last three years. I believe that India will continue to grow at a fast pace for two main reasons. First, in India, old mindsets are being tossed aside in favour of pragmatic policies supporting reform and liberalisation, and integration with the global economy. India's market reforms have stayed the course despite several changes of governments and Prime Ministers. Business leaders, too, are prepared to compete against foreign companies and foreign investors in India. Early this year, I met with the Chief Minister of West Bengal in Kolkata. The state has been under communist rule for 30 years. The Chief Minister, one of the politburo members of the Communist Party of India (Marxist), was keen on foreign investments.

I hope that the next few days will provide all of you with fresh insights into Asia and Singapore. Thank you. 4  BIS Review 86/2006
The Riksbank believed this expenditure would be higher than estimated in the report and that small and medium-sized firms in particular would find it difficult. The Riksbank also drew attention to the risks of Sweden being discriminated against in various respects. One example was the disadvantageous terms for outsider countries in TARGET, the European payment system. Moreover, an outsider position for the time being would involve additional costs in various parts of the economy. Financial institutions, for instance, would have to operate twin systems in order to remain competitive. Negative long-term effects of remaining outside Such is the nature of the long-term effects that assessments of them are unlikely to change fundamentally in the course of a year or two. Still, there is new and additional information that may cast a somewhat different light on certain aspects. One major issue concerns the link between EMU and the single market. There is empirical evidence that the single market is exerting downward price pressure in the European Union. Some assessments suggest, moreover, that EMU may lead to a further price fall; figures as high as 10 to 15% have been mentioned. If the effects were to be of that magnitude, the welfare gains would be substantial. 3  BIS Review 92/1999  In practice, however, it is not easy to distinguish the parts that EMU and the single market are playing in price formation. Empirical data therefore have to be treated with caution.

The establishment of temporary credit institutions or bridge banks is emerging as a key resolution tool, but the new resolution frameworks need to address a number of related technical issues, such as the question of who provides the necessary capital and liquidity to the bridge institution, how the bridge bank can use the infrastructure of the failed bank, and how and when it is ultimately dissolved, since bridge banks are temporary entities needing a good exit strategy. Finally, the design of bank levies, which could usefully be collected into resolution funds, is also a delicate area. Mechanisms are under examination both to recoup the losses of the crisis and to create provisions against future events. I believe that ex ante funding is a crucial element, since it may reduce moral hazard and improves the authorities’ ability to react to crises earlier, thus strengthening the credibility of such actions. Levies are valuable revenueraising mechanisms with which to finance crisis measures. Uncertainty remains as to how they would affect the particular problem of moral hazard in the financial sector, and both the rate and the base of levies need to be determined with care, especially if we want to include the aspect of systemic risk as well. However, maintaining a level playing field and coordination between Member States remains in my view paramount in order to avoid a distortion of fund contributions and resolution tools. Challenges ahead – more integration I am confident that the emerging EU regime will appropriately address all these challenges.
An even greater challenge is measuring the exposure of the firm not simply to the direct effects of the failure of a particular hedge fund counterparty, but to the broader distress that it might cause to other market participants or its impact on the other exposures of the firm. The management of these direct and indirect exposures needs to be an important focus of attention. Capital and margin Supervisors have put a considerable amount of effort over the past decade into designing a successor to the Basel capital accord. The present regime does not do a good enough job of capturing the risks a major institution typically assumes today. Because it understates the amount of capital required against some risks, overstates others, and ignores still others, we should work to put in place a replacement regime as quickly as we can be confident we have a viable alternative. The prudent, conservative approach should be to move forward to a more risk sensitive framework that creates better incentives for prudent risk management, not to try to extend the life of the present accord. It is critical that these broader efforts to fix the capital regime be reinforced with more attention by supervisors to margin practice and limits around the counterparty risk-management process within the major financial institutions. The regulatory capital regime is designed to offset the effects on individual firms of lower margin. Where margin levels are low relative to potential exposure, the capital requirement is higher. Where margin is higher, the capital charge is lower.

The capital requirements and other constraints we place on the regulated institutions have played an important role in encouraging the transfer of risk to a broader range of institutions, including the leveraged private pools of capital. As the aggregate size and importance of those funds increases, distress among those institutions can have greater effects on overall market dynamics, potentially increasing risks to the regulated core. Over time, this will force us to consider how to adapt the design and scope of the supervisory framework to achieve the protection against systemic risk that is so important to economic growth and stability. For the present, however, our hierarchy of priorities should focus on improving supervisory incentives to make counterparty discipline more effective and to strengthen the resilience of the core institutions to more adverse economic and financial conditions. Thank you. 8  BIS Review 85/2006