samchain/econo-pairs-v1 huggingface dataset:
The major economic policy challenges facing the nation today - pick your favorites among the usual suspects of low public and household savings, concerns about educational quality and achievement, high and rising income inequality, the large imbalances between our social insurance commitments and resources - are not about monetary policy. Poor monetary policy choices would make these problems harder to address, but monetary policy itself can't do much to fix them. The issues about monetary policy regimes we spend most of the time debating these days - such as those involving communications and disclosure and variants on inflation targeting - are high class problems to have. Even if they were resolved in the direction of what seems to be the broad academic consensus, they would still leave us with all the hard questions in monetary policy. The color of truth in monetary policy (apologies to McGeorge Bundy) is often grey, not black or white, and moving further along the spectrum toward greater transparency or more explicit rules, will not make easier the hard choices of what to do in the face of the normal fog that surrounds the forecast. In thinking about the durability of these gains in monetary policy delivered under Volcker and Greenspan, there are a few aspects of our history and about the world today that deserve note. The actions of individual chairmen have been very important in the history of the Fed.

Among these are: •  The transition from a long period of exceptionally low short-term nominal and real interest rates in the major economies and in many emerging market economies as well. Real  short-term interest rates in much of the world, as in the United States, are still some distance below the band of estimates of equilibrium. •  The approaching demographic pressures on fiscal resources, which will hit most major economies at a time when underlying fiscal positions are still likely to be in substantial deficit. •  The inevitable evolution in the exchange rate regimes of China, and the substantial number of countries that have been actively targeting their nominal exchange rate against the dollar, to a system where there is more variability in their bilateral and real effective exchange rates. •  The disposition of the global imbalances reflected most conspicuously in the U.S. current account deficit. These are all types of disequilibria. They can be sustained for a time, but not indefinitely. They could be diffused gradually and smoothly. But the transitions to a more sustainable equilibrium could also bring a risk of greater volatility in asset prices, less stability in macroeconomic outcomes, and more uncertainty. This could mean a less benign future environment for U.S. monetary policy. The potential uncertainties posed by these challenges may be more troubling because of confidence engendered by the stability and resilience of the U.S. economy over the past decade.
In many cases this has amounted to 10% or more of GDP. Monetary policy may be side-tracked by the need on the part of the authorities when determining interest rates to take account of the possible implications on banking stability and on other, often more political, policy objectives. 4. Furthermore, in nursing weak banks, the main priority for these banks is likely to be to repair the damage to their balance sheets and they may have little appetite for new lending. This leads to the “credit crunch” phenomenon where even good-quality borrowers find it more difficult to obtain loans when banking stability has been undermined. As the Japanese experience has shown, this weakened ability of banks to lend can frustrate the authorities’ efforts to get the economy moving again after a downturn. The role of bank borrowing in funding growth 5. This possible impairment of the intermediation role of banks would be a particular cause for concern in Asia where the banks have played a substantial role in financing economic growth. By the standards of developed economies, this role for banks in Asia is significantly more important than that of other channels of financial intermediation. This partly reflects the lack of highly developed bond markets in the region, which in itself is also a reflection of the predominance of the banks. 6. Let me digress a little in this connection. There is clear consensus on the need for encouraging the development of bond markets in Asia.

It must, however, be properly handled if the problems of the banking sector are not to intensify during the transition to a more commercialized system. In particular, the supervisory framework should be strengthened in advance of liberalization. Maintenance of asset quality 19. Let me turn to the challenge of the maintenance of asset quality. This applies across a wide spectrum in Asia from banks that are emerging from tight state control to those that operate on a fully commercial basis. A particular focus of concern, as I have already indicated, is that banks in some economies may have lent too freely to booming property sectors which are now suffering from over-supply. It remains to be seen whether the fears will be realized. A number of supervisory authorities around the region have tried to take measures to limit their banks’ exposure to the property sector. This is a sensible move, though the difficulties of enforcing limits should not be underestimated. 20. However, property lending is not the only problem area. In Korea, for example, the slowdown in export demand in industries such as semiconductors and in economic growth has exposed fragility in those companies which have over-extended themselves by taking on too much debt. Banks which have become used to years of buoyant economic growth may be ill-equipped to deal with these problems. There is also a perception that in some Asian economies the accounting rules and loan classification systems are not telling the whole story about the scale of the bad debt problem.
I believe that we should try to learn as much as possible from the past mistakes. And I refer here not only to the recent past! The lessons of the last 7 years, while important, should not make us forget the lessons of the last 50 years, among which, to name but three, are the following: –  Accommodating other objectives should not put in danger price stability on the medium-run;  –  Inflation expectations cannot be ignored;  –  The independence of central banks is connected with their performance in delivering price stability. Irrespective of how we see now the future of our profession and institutions, it is apparent that the central bankers cannot afford to live in an ivory tower. They have to stay openminded and to keep close contact with the shifting economic and financial reality in order to be able to articulate and implement efficient policies. And if you still want me to foretell the future, I will end my speech by making a prophecy: what a central bank can or cannot do will remain a topic of heated debate for many decades. References Cœuré, B., “Independence and Interdependence in a Monetary Union”, Lamfalussy Lecture Conference organised by Magyar Nemzeti Bank in Budapest, 2 February, 2015. Crockett, A., “International Standard Setting in Financial Supervision”, Lecture at the Cass Business School, City University, London, February 5, 2003. Goodhart, C., “The Changing Role of Central Banks”, BIS Working Papers No 326, 2010.

Ardian Fullani: Overview of Albania’s banking sector Speech by Mr Ardian Fullani, Governor of the Bank of Albania, at the end-year reception, organized by the Albanian Association of Banks, Tirana, 23 December 2011. *  *  *  Dear bank executives, Dear participants, This end-year event with the Albanian Association of Banks, turned into a tradition of communication between the banking sector and the Bank of Albania, provides an excellent opportunity to make a short resume of the results achieved by this sector in this year as well as to identify its challenges in the upcoming year. The banking sector managed to finish off 2011 successfully. Its role in supporting Albania’s economic activity was crucial, while prudence was made to guarantee its financial soundness. In this regard, the supervisory role of the Bank of Albania has provided an extraordinary contribution. Banking supervision has been proactive and preventive by creating, at the same time, the necessary space for flexible banking activity management. Amendments to the law “On banks in the Republic of Albania”, a number of amendments to the banking regulatory framework as well as the physical interaction through on-site inspections have contributed to enhanced immunity and dampened negative effects generated by the global crisis. The Bank of Albania has periodically conducted stress tests on specific banks to ensure that the banking sector’s security and functionality is never put in doubt.
In my view, some very interesting positions: First: The MLA has been designed to ensure that the Central Bank functions as an independent body, with a high degree of autonomy to fashion and implement its policies, which have far reaching implications for the people. Mr. Chairman, let me now cite from the first paragraph of the Exter Report where he deals with the significance of the Central Bank System. I quote: “The decision of the Government of Ceylon to establish a central bank was a decision with far reaching implications for the people of Ceylon. One implication already stands out very clearly: in taking steps to establish an independent monetary system to be administered by a central bank, the Government has demonstrated unmistakably its intention to achieve genuine economic freedom as a corollary of the political freedom achieved a year and a half ago.” Having set the stage, Exter goes on to elaborate the responsibilities to be undertaken by the Central Bank: “A central bank thus undertakes a great responsibility, and the broad powers given to the Central Bank of Ceylon under the draft bill in Part II of this report are commensurate with the magnitude of this responsibility. The Bank should not be hampered by rigid limitations which might prevent it from fulfilling its purpose.” Second: Exter reports on the need for the Central Bank to function in the context of the other agencies of government.

Case study 7: Judicious use of fiscal policies, based on inflation behavior and other macro-economic factors Mr. Chairman, I have so far discussed 6 case studies that confirm the co-operation and harmonization between the MoF and CB. The co-ordination however, went even further and was applied in several other situations as well. Now, I am going to describe one general  BIS central bankers’ speeches  11  example out of several similar instances which took place from time to time, over the past few years. Let us take our minds back to October/November 2011. At that time, the global oil prices had soared to dizzy heights, and the Ceylon Petroleum Corporation was incurring rather heavy losses. As a natural response therefore, an increase in the administrated prices in petroleum products seemed like a sensible action. However, at that time, inflation in the country was around the 7% level. Inflation projections for the next 2 months too, were around the 7% to 8% levels. In that background, our view was that, if the petroleum prices were to be adjusted upwards significantly, the inflation figures would have risen above 10%, and had that happened, the favourable sentiments that had been built up carefully over the previous 33 months would have been badly damaged. Then, we would have had to start our inflation control efforts all over again, and inflation expectations too would have suffered considerably.
This, too, we hope will support credit availability. It is too soon to assess the impact of all these changes on the resilience of the financial system and on credit creation. We will monitor the results of these actions very carefully, and we will be prepared to amend our judgements in the light of experience. The key point here is that we are applying judgement to our decisions on regulation and within a framework that quite explicitly defines and seeks to balance our objectives of resilience, the primary objective, and, subject to that primary objective, supporting credit conditions and economic activity. To be clear, in this world of judgement-based regulation, we will not get all the calls correct, not least because the future is uncertain. But, I am a lot more comfortable that we have a framework in which we can apply judgement more consistently and be held to account for those judgements in a more open way. There is one further element to the package of reforms, namely the measures proposed by the Commission chaired by Sir John Vickers, which the government intends to place into legislation in the near future. I fully support the Vickers proposals. The key plank of this is to ring-fence commercial from investment banking and, in doing so, define the scope of commercial banking that can be inside the ring-fence. This will be a major structural change for the banking system, and will have important implications for us as regulators.

And, at least to a degree, competing away their deposits would compromise banks’ ability to supply credit, or at least make it more expensive.15 It might also make that supply more variable. With an easily available alternative, banks’ remaining deposits would more readily migrate to the CBDC during times of stress. (It would certainly be more straightforward than stuffing cash under the proverbial mattress16.) Nor has the alternative source of funding the banks – raising debt in wholesale markets – proved that stable in the past. In fact, one striking feature of the financial crisis was that banks’ wholesale debt proved much less stable than deposits. That’s why regulators have since recommended that banks actually raise the share of (non-equity) funding that comes from deposits17. It’s hard to know how significant these effects would be. And, as I tried to explain earlier, a CBDC that sought simply to replicate cash would probably have a greater impact on the demand for banknotes than on commercial bank deposits, with more limited macroeconomic effects. If the central bank’s balance sheet were opened up only to non-bank financial companies, and no wider, the issue probably wouldn’t arise to begin with. But as you widen that access, and the more closely a CBDC substitutes for existing deposits – i.e. the further towards the south-east you move across (the extremely stylised) Chart 5 – the more prominent the issue becomes. No longer would a CBDC be a purely technical decision, about the costs and security of exchanging money.
If oil prices remain low, it may quickly become necessary to take a critical look at the scale of welfare schemes and public sector services, and it may also be necessary to increase taxes. If, later in the business cycle, measures are called for to curb unemployment, they should be designed to be readily reversible and in such a way that they do not erode government finances in the long term. Conclusion By way of introduction, I posed the following question: is our economy sufficiently robust to cope with the fall in oil prices without a new round of major structural adjustments? Our financial system is in a stronger position to cope with a new downturn than it was in the 1980s. We have avoided a debt bubble of the scale we witnessed last time. However, I am in doubt as to the financial industry’s long-term restructuring capacity. Norway must endorse the development of a new architecture for the global financial system. This is a demanding and long-term process, and we cannot expect all the problems to be solved over night. On the other hand, if we are to have any hope of a more stable and predictable world economy, the only real alternative is to enhance international codes for financial markets. We have observed that confidence in the krone is fragile. In order to restore confidence and maintain a stable exchange rate, monetary policy must be a credible anchor for expectations of continued low price inflation.

While educated young people are moving abroad, I invite you to consider investments in technology, not only for the automation of processes, but also as an opportunity to prevent the impoverishment of the labour market, thus contributing to setting up conditions for keeping the qualified labour force in this market, which is also part of the elite clientele of the banking market. In conclusion, let me assure you that the Bank of Albania provides the maximum support and attention to all your proposals, not only in capacity of the regulatory authority, but also, as a loyal, supportive and serious partner, aiming at achieving the common objective, that is a developed market which offers attractive possibilities for investors, for financial stability and a fair competition which respect the consumer’s rights. Our decision-making will be transparent and all our initiatives will be guided by a spirit of cooperation with the banking sector, aiming at ensuring highest efficiency. Thank you for your attention! 3/3  BIS central bankers' speeches
And there have been a number of exercises and co-ordination initiatives in different regional groups (for example amongst the Nordic countries, Dutch and Belgian authorities, and more widely across the EU). But there has been less progress on the wider international front. Overall, I do not know anyone who believes that we have established either the common approach to crises or the practical machinery which would enable us to handle a complex cross-border failure with confidence. I would like to make some suggestions tonight on how we might take matters forward. When and how should the State intervene to prevent or manage a financial crisis? Of course the underlying questions are very difficult even for one country. Financial markets are often volatile and they can only work well if investors and firms expect to live or die by their own decisions and do not come to rely on a safety net to mitigate their losses. To avoid that ‘moral hazard’, authorities have tended to be reluctant to spell out in what circumstances and what ways they would  1  Gerard Caprio and Daniela Klingebiel, 2003. “Episodes of Systemic and Borderline Financial Crises”, World Bank Research Dataset. http://econ.worldbank.org  2  http://www.fsforum.org/home/home.html  BIS Review 112/2006  1  be willing to help support a market or a participant, beyond making clear that it would only be in exceptional circumstances and where it was essential in the wider systemic interest.

The banks in Bulgaria have an important year ahead, which we expect to be overall successful for the sector. Banks’ operations continue to take place in an environment of rather optimistic attitudes of enterprises and households amidst a relatively high growth of the Bulgarian economy. At the same time, the external environment holds risks and insecurity that, due to the openness and international integration of our economy, could potentially affect the economic 1/2  BIS central bankers' speeches  situation in Bulgaria. Some adverse scenarios could exacerbate aspects of the risk profile of the banking sector. Therefore, it is essential that in their behaviour banks continue to take into account the main risks, including profitability risks and asset quality risks. 2/2  BIS central bankers' speeches
Attracting talent into the financial sector To increase the flow of talent into the financial sector, IBF has also been reaching out to our institutions of higher learning. Under the financial sector seminar series, IBF and our industry partners have delivered a series of talks at our universities and polytechnics to highlight the dynamism and the diverse career opportunities in the financial sector. These talks attracted a total audience of over 1000 participants. To increase the supply of job-ready graduates, IBF spearheaded intensive finance preparatory programmes (FPP) for jobs in high demand. The first batch of students for the FPP in Global Banking and Securities Operations, which was introduced in July 2007, will be completing their programme next month. IBF is currently exploring the need for FPP in Insurance. These programmes will continue to attract 70% co-funding support from the Financial Sector Development Fund Gaining international mindshare To create greater international mindshare, IBF launched the FinanceConnectSingapore website to profile Singapore’s financial sector, to provide more information on the career opportunities here and to promote Singapore as a choice location to live, work and play. To date, the website has registered over 100,000 visits. IBF recently partnered with Contact Singapore to provide a job portal for financial institutions to post job openings targeted at financial professionals from overseas. Bringing value to IBF members I have outlined some of the initiatives undertaken by IBF over the past year.

Heng Swee Keat: Talent management strategies in Singapore Opening address by Mr Heng Swee Keat, Managing Director of the Monetary Authority of Singapore and Chairman of the Institute of Banking & Finance (IBF), at the 2nd IBF Annual Conference, Singapore, 20 June 2008. *  *  *  Welcome to the 2008 IBF Annual Conference which is held in conjunction with our 33rd Annual General Meeting. When we held our last AGM and Annual Conference in May last year, the mood among global financial institutions was buoyant. The outlook for the global economy and financial markets was positive. The main concern among firms was the severe shortage of staff. Today, the mood is cautious. The credit crisis is still working its way through, inflation has become a major concern everywhere, and economic prospects are more uncertain. In Asia, investors and economists remain cautiously optimistic about the growth prospects of the economies. While financial institutions had limited exposures to sub-prime assets and related credit derivatives, financial markets in Asia are not isolated from global markets. We are seeing a similar rise of risk aversion and tightening of credit conditions. The situation in the coming months will remain fluid and we must remain vigilant. Talent management – a strategic imperative The developments in global financial markets in the last one year have important implications on human resources strategy.