samchain/econo-pairs-v1 huggingface dataset:
We offer political and economic stability, the rule of law, efficient infrastructure and a highly-skilled professional workforce. These are exceptional attributes, which lend themselves well to activities like wealth management. We need to find new ways to market them and bring in business. Enhancing monetary policy effectiveness Our decision to progressively relax restrictions on the use of the Singapore dollar was a calculated risk. At a time of heightened volatility in currency markets, it stood in stark contrast to our regional neighbours. However, the liberalisation has yielded dividends. Our capital markets have grown and deepened without adversely affecting our ability to manage the exchange rate. In practical terms, we have now gone as far as we can to relax the restrictions while still maintaining the principle of not-internationalising the Singapore dollar. All but two restrictions have been lifted – thou shalt not borrow Singapore dollars to speculate in the currency, and if thou shouldst borrow for offshore purposes, then thou shalt either swap or convert the Singapore dollars before taking them out. These remaining commandments are an important signal that we have not changed our fundamental stand against outright speculation on the Singapore dollar, even though we have permitted nearly all activities of legitimate investors. 3  Today outstanding SGS is about $ billion, compared to just over $ billion in 1997. 4  From 1998 to 2001, corporate debt issuance in Singapore has increased eightfold to $ billion.

Svein Gjedrem: Experiences with the financial crisis Lecture by Mr Svein Gjedrem, Governor of Norges Bank (Central Bank of Norway), at the Centre for Monetary Economics (CME)/BI Norwegian School of Management, Oslo, 30 September 2009. The text below may differ slightly from the actual presentation. * 1. *  *  Introduction  The last time I addressed this assembly was on 12 September 2008, only a few days before the US investment bank Lehman Brothers filed for bankruptcy. The Norwegian economy had entered a new phase. Low inflation and high growth were late in the upturn being followed by somewhat higher inflation and slower growth. Early summer the key policy rate had been raised to 5.75 per cent – a fairly normal level. It seemed that the elevated level of capacity utilisation in the Norwegian economy would gradually drift down. The economic conjuncture took a different turn. The Lehman Brothers’ bankruptcy on 15 September triggered a crisis with failing confidence in banks, counterparties and contractual partners and confidence in the future plummeted. The world economy entered into a sharp downturn. It became increasingly evident that the Norwegian economy would slow at a faster pace and to a further extent than we had envisaged. In August last year, manufacturing enterprises in our regional network reported that growth would hold up. In November, they described the turnaround as a “cardiac arrest”.
Most of the work in terms of harmonising investment products across the EU has already been agreed. Progress on savings products has also been achieved. In particular, the development of the market for the Pan-European Pension Product is particularly relevant considering the situation of public finances in many EU countries and the challenges posed by population ageing. But, looking ahead, greater headway is needed over the coming years. In particular, allow me to highlight three dimensions. First, the legal framework: Insolvency regimes vary widely across jurisdictions for financial and non-financial corporations, as a result of cultural traditions and legal frameworks. This is a major obstacle for cross-country investments and, I would add, a very difficult one indeed to overcome. Second, the strengthening of European regulators. As European markets become more integrated and technologically complex, this is becoming a more essential element that policy-makers need to address. It will be even more important since, depending on the final outcome of negotiations, Brexit might increase the risk of fragmentation, as some companies and transactions may be reallocated to various possible destinations, while others may remain in the UK. 8/11  Third, more needs to be done in terms of making capital taxation more consistent. The debate has stalled in this regard. For example, the various regimes for withholding taxes, with more than 90 types of forms in different languages, are often cited as a huge obstacle for investment by market participants. Moreover, the favorable tax treatment of debt compared to that of equity has significant economic implications.

The goals of monetary policy If one looks at the 10 years leading up to the onset of the crisis – which were also the first ten years of the Bank’s MPC – the outcomes for inflation and for aggregate economic growth in the UK were good. Inflation was – by historical standards – very low, very stable and close to the target. That had not been achieved at the expense of unusually low growth or high unemployment. In Ireland growth had been much stronger and inflation a bit higher. The aggregate outcomes looked good in both countries (Charts 1–4). In the UK there was a strong consensus that having monetary policy directed at hitting an inflation target was sensible and that it had been successfully implemented. BIS Review 133/2010  1  But if you now view the mess that we are dealing with after the financial crisis as substantially reflecting monetary policy decisions, you would take a completely different view of how well policy had been run. The charge is that policy in the UK was inappropriate given the huge build-up in many asset prices, and particularly in debt, or leverage. The fact that monetary policy could be very successful in terms of hitting an inflation target – and in the UK it was 1 – but not prevent a very serious financial crisis, and one that has been followed by much more variable inflation, is taken by many as a clear demonstration that the inflation-targeting framework is flawed.
Benoît Coeuré: Adjustment and growth in the euro area economies Speech by Mr Benoît Coeuré, Member of the Executive Board of the European Central Bank, at the Nova School of Business and Economics and the Bank of Portugal, Lisbon, 22 February 2013. *  *  *  Introduction1 Dear Governor Costa, Ladies and Gentlemen, It is a great pleasure to be here today and share with you my thoughts on the adjustment under way in the euro area. This is a challenging issue, especially here in Lisbon, as Portugal is at the heart of this process. Taking the Lehman collapse as a starting point, the economic and financial crisis has now lasted four and a half years, almost one-third the age of the euro. For the stressed countries, this has been a tough time. It saw a sharp decline in GDP and a sharp rise in unemployment, with young people particularly affected. People’s daily lives have not yet visibly improved. This is why it is important to focus on the progress made during the past five years and on why and how reforms can create income and jobs. I have in mind three questions: (i) How much adjustment is still needed? (ii) Why have the costs been so high? (iii) Are conditions in place to restore growth? The public would probably formulate these questions differently: can we hope that things will get better? Will the policies work? And will we see an improvement in our daily lives?

However, in the context of uneven and uncertain recovery I have described, we cannot rule out the possibility that the risks identified may materialise or that their impact and persistence may be greater than expected. In this sense, in the banking sphere, the response to the possible materialisation of these risks can only be at the European level, given the commitment to banking union. 13  In this response, the completion of banking union with the launch of a fully mutualised European deposit insurance scheme would make a decisive contribution to ensuring financial stability in the euro area, in the coming months and in the medium term. It is also crucial to analyse how appropriate the European regulations for resolution and winding-up of credit institutions are for a hypothetical systemic crisis, or the possible role that asset management companies may play in the event of severe impairment of European financial institutions’ balance sheets. The EU Member States should also make swift progress towards an agreement to create a common European procedure for administrative windingup of credit institutions. This procedure would benefit from the instruments developed for resolution of credit institutions, aiming to maximise the realisable value of the financial assets that make up the bulk of banks’ balance sheets. In Spain, recent experience has shown how inefficient the existing insolvency proceedings for credit institutions are in terms both of timelines and recovery in value.
The outcome was almost one percentage point lower, that is, one and a half percentage points below the target. 4 That there may be a good deal of truth in this interpretation is supported by a number of critical newspaper articles published around that time, see, for example, “Nya direktörer men samma gamla riksbank” [New directors but same old Riksbank], Aftonbladet (2013), 22 May and “Ta tillbaka makten över Riksbanken” [Take back control over the Riksbank], Dagens Nyheter (2014), 15 June. 2 [17]  The important lesson to learn here is, as I see it, that it is absolutely key to show that you always do have your eye on the ball and do not let other factors come into the picture in a way that risks economic actors starting to doubt that this is the case. I have been reminded of this lesson on a number of occasions lately, most recently at the monetary policy meeting in October. The picture we painted at that time of monetary policy going forward, in which we predicted that the repo rate will be raised very slowly to take it back into positive territory in the longer term, was one that I largely considered to be well-balanced. However, I expressed considerable doubt over the next increase in the repo rate happening as early as around the turn of the year, most probably at our next meeting in December, as implied by our forecast for the repo rate.

In other words, the inflation target is the Riksbank’s and only the Riksbank’s. This interpretation is, however, both incorrect and unfortunate. So whose is the inflation target, then? The decision to introduce an inflation target of 2 per cent was taken in 1993 by the General Council of the Riksbank. At that time, the General Council had a different role to the one it has today and was the Riksbank’s decision-making body. The then Governor, Bengt Dennis, has described the prevailing regime as follows (Dennis, 2003, p. 182): “The General Council consisted of eight members. Seven members were elected by the Riksdag while the eighth, the Governor of the Riksbank, was appointed by the General Council. It was a council elected on political grounds and the majority of its members were active politicians”. At the outset, the inflation target received a fair amount of criticism, even from politicians. But quite soon, when the advantages of the target had become clearer, broad support emerged for it. For many years now, the Riksdag Committee on Finance has performed a review of monetary policy and every few years has also tasked two foreign economists to review monetary policy. These reviews largely concern the policy that the Riksbank has conducted but there is of course nothing in principle to prevent framework issues being addressed, which has also happened on occasion.
This isn’t an issue about a single fund or even about funds invested in a single asset class. Any incentive for investors to be at the front of the queue might be detrimental to the resilience of finance for the real economy. The emerging evidence is that companies whose existing liabilities are subject to selling pressure from funds tend to cut back new issuance and – presumably to protect their cash flow position – cut both investment and employment.17  If these new forms of finance are to give maximum support to long-term economic growth and investment, we need them to be consistent. So, after highlighting this issue in late 2015, the FPC supported the work of the Financial Stability Board (FSB) of the G20, culminating in the FSB’s January 2017 recommendation that market regulators should ensure funds’ redemption terms are consistent with their assets and investment strategy.18 Since then, global market regulators, who are at the coal face of these issues, have been turning this recommendation into new rules. Here in the UK, the FCA is finalising its own rules for funds investing in illiquid assets to strengthen liquidity management. 19  These are global issues. So macroprudential authorities across the world will need to review new global asset management rules. An assessment is needed of whether they will be effective in dampening any restriction to the supply of finance during economic downturns.

In the UK at least, macroprudential policy has become an operational reality. Now, with the help of research and the latest techniques, we’re looking to the future. That work will help us stay disciplined and agile in keeping up with changes in the economy. It’s guiding us to what needs to be monitored closely in the non-bank system and where new standards of resilience might be needed to keep up as the financial system changes shape. Keep up we must. It’s no use waiting for the tremors. When the economic ground shakes, whenever that may be, we will all want the financial system to be resilient. 20  All speeches are available online at www.bankofengland.co.uk/news/speeches  20
The current development of the interbank market in Albania does not fulfil these assumptions yet and therefore, it makes the work of the Bank of Albania difficult in carrying out this essential function. Year 2002 recorded the start of the interbank market, the same year when the indirect instruments were introduced by the Bank of Albania to conduct its monetary operations. The Bank of Albania has attended the developments of the interbank money market in the last five years. During this period the trading volume has been fifteen folded, climbing from a daily average of 130 million lek in 2002 to a daily average of around 2 billion lek in 2007. Also there has been an increase in the maturity of the traded funds, from only trading overnight back in 2002 to trading up to three months in 2007. Also there has been an increase in the maturity of traded funds, from only trading overnight back in 2002 to trading up to three months in 2007. From the beginning of this year, we have been able to publish the fixed interest rate indexes, TRIBOR and TRIBID, which is hoped to promote the development of the interbank money market. However, we have to admit that this development has been a very slow one. During the last five years, the lek liabilities of the banking system have increased by 135 billion lek, which makes the increase in the trading volume of interbank market by a daily average of 1.9 billion lek, only a peanut in a big cake.

Last year, AFIN launched the API eXchange – the world’s first cross-border, open architecture platform to enhance financial inclusion. The API eXchange is a cloud-based platform that does two things: It is a marketplace, enabling financial institutions to discover and connect with FinTech partners through APIs on a globally curated platform. It also provides a sandbox environment for financial institutions and FinTech firms to design and test cross-border solutions. I have spoken so far of how the two musketeers – Finance and Technology – can and must come together to bring value and convenience to customers. But for consumers to be part of this ecosystem, there needs to be Trust – the third musketeer. Trust – the Musketeer who Binds Consumers to Finance Trust is similar to Aramis, the third musketeer who is faithful and values friendship. Trust is a key attribute for the success of a financial ecosystem. It is a shared responsibility among all the actors in the ecosystem. Banks in particular must be trustworthy so that customers have faith that their money and 7 / 10  BIS central bankers' speeches  data are safe with them. As Finance adopts more Technology, it must pay close attention to three risks, so as to maintain the Trust of consumers. First, cyber risk. As more financial services move online and collaboration among banks and technology companies becomes more pervasive, a growing risk that financial institutions are facing is in cyber space. The frequency, scale, and complexity of cyber-attacks are mounting.
I think we can all recognise that climate related financial risk disclosure - and in particular the scenario analysis I mentioned earlier - is an evolving discipline. Learning by doing and iterating with experience is the key to success and so keeping the recommendations voluntary allows them to be nimble and adaptable as experience grows. Long term risks like these are hard to measure. To be meaningful we need to bring together climate scientists, macroeconomists, financial risk modellers, and business heads. And we need time to develop our analytical capabilities, to experiment across these different disciplines and to innovate. This reinforces the aim of the TCFD to create a virtuous circle where firms voluntarily adopt the recommendations, investors respond by making clear which disclosures are of particular value, and firms learn by doing as good practice emerges. This virtuous circle is already well established in financial markets. 3  See, for example, Carney (2015), “Breaking the Tragedy of the Horizon – climate change and financial stability”, speech given at Lloyd’s of London, September 2015 and Carney (2016), “Resolving the climate paradox”, Arthur Burns Memorial Lecture, Berlin September 2016.

The Bank’s approach has therefore been to seek to reduce these risks to financial stability by engaging with initiatives which support an orderly market transition and facilitate a shift in financing to support climate goals. I want to talk about three specific areas: disclosure, green finance initiatives and the need for coordination. Disclosure The Bank has been supportive of the FSB’s Task-force for Climate Related Financial Disclosures (TCFD). The TCFD recommendations provide an excellent basis for firms to disclose their exposure to climate-related risks and opportunities and their related strategies, governance and risk management practices. Disclosure helps investors identify which businesses are best equipped to deal with the risks and opportunities that climate change presents. And that in turn creates the pressure for change that ensures the risks are managed better than they would otherwise be. For me what was ground breaking about the TCFD recommendations was the introduction of scenario analysis - where firms set out the resilience of their strategy in different climate related scenarios, including a two degree or lower scenario. To be clear these scenarios are not forecasts or predictions. Rather they are data driven stories that are designed to enable the market to drive better decisions today. They are thus hugely more informative than spot observations of current exposures. And they are absolutely what is required to help investors price medium and long term risks like these. The TCFD recommendations are voluntary. In my view that is important.
Aiyar et al (2014, 2016) find that shifts in required capital had large negative effects on UK banks’ lending decisions. De-Ramon et al (2016) report a similar finding, noting that this has, if anything, increased since the crisis. Bahaj et al (2016) find that, in times of credit expansion, higher required capital has only a minimal effect on lending. But when credit growth is weak, higher required capital can result in a large reduction in lending. This echoes previous research which has found that banks reduce lending in response to negative capital shocks (Peek and Rosengren (1995)). Lower lending was one cost of higher equity considered in the LEI study. A second potential cost, not considered by the LEI study, was the potential for falls in market liquidity in core financial markets - for example, securities financing markets such as repo. This could potentially raise the cost of capital for users of these markets. Market commentary in recent years has often laid the blame at the leverage ratio. This, it is argued, has led some dealer-banks to reduce their inventory holdings and market-making capacity, thereby reducing secondary market liquidity in some markets. 14  All speeches are available online at www.bankofengland.co.uk/speeches  14  There are of course a variety of other reasons why banks’ willingness to make markets, and why market liquidity more generally, might have been affected by the crisis – for example, reduced risk appetite and increased counterparty risk.

Once translated into default probabilities, Acosta-Smith et al (2017) find that the second effect swamps the first: a one percentage point rise in the leverage ratio raises the odds ratio (on banks being in distress versus safe) through risk-shifting by 1-3.5%. But the reduction in the odds ratio from lower leverage is close to 40-50%. Second, the leverage regime is not a replacement for the risk-weighted capital regime but an addition to it. The capital regime places an automatic upper-bound on the extent to which banks can increase their risk-weighted assets. In other words, the capital ratio regime places constraints on incentives to risk-shift. Conversely, the leverage ratio can serve as an effective constraint on incentives to game or shade risk weights. Risk-taking incentives are, in effect, book-ended by the leverage and capital constraints. From an incentives perspective, if regulatory arbitrage incentives are two-sided, so too should be the constraints needed to straightjacket that behaviour. That is another way of rationalising the “multi-polar” regulatory regime operating internationally. When it comes to calibration, this means leverage and capital ratios need to be jointly determined to prevent incentives skewing in one or other direction. This is the approach in the UK when setting capital and leverage constraints (Bank of England (2015a)). 29  All speeches are available online at www.bankofengland.co.uk/speeches  29  There are other means of constraining adverse incentives.