samchain/econo-pairs-v1 huggingface dataset:
That has been possible thanks to the recapitalisation operations performed by directly tapping the markets; to the capital injection financed through the Financial Assistance Programme agreed with the European authorities, for a final amount of € billion; to the conversion of hybrid instruments into capital instruments; and to the funds provided by the FROB and the Deposit Guarantee Fund. Currently, all Spanish banks meet the regulatory capital ratios required. As at the close of the first quarter this year, the solvency ratio of our banking system was 11.6%, compared with the current minimum of 8% required under the Basel Accord. It is worth stressing – as certain comments made seek to omit this or completely misinterpret it – that the fundamental intention and effect of the capital injections with public funds (whether from the European Stability Mechanism or from the Spanish Treasury) has been to prevent the winding-up of banks, thereby preserving customer deposits. BIS central bankers’ speeches  5  It would be remiss not to mention here the problem of the hybrid capital and subordinated debt instruments sold to retail customers by credit institutions which, following the detection of capital shortfalls in the stress tests completed last September, were unable to cover their capital needs with their own resources and received State aid.

As an example, it is more difficult to propose needed regulatory measures at the same time as promoting the growth of the financial market. To sum up: A country should be able to manage independence, accountability, transparency and efficiency satisfactorily in any kind of supervisory structure. For independence there might be some advantage with central bank supervision. But for cooperation leading to better efficiency there might be a slight advantage with a unified authority. Arguments for and against various supervisory structures After having discussed the conditions for good supervision let me now review some of the arguments for and against the various actual supervisory structures. I will first address the issues of having supervision inside or outside the ministries and the central banks. I will then turn to the arguments for and against unified authorities. Supervision inside ministries may provide some benefits in the form of insight and staff expertise, maybe also access to resources. But there is a strong disadvantage in the lack of independence plus the risk to the public’s confidence in the government if failures should occur in the supervised sector. There is also a serious governance issue in those countries where the government is the owner of financial institutions and also supervises them. Arguments for retaining supervision in the NCB What about supervision inside the NCB? First, banks have a special importance in the financial system. Their activities are often complex. Therefore, they need high quality, resource-intensive supervision. The NCB normally has independence and revenues.
The financial stress episodes of the past few weeks are part of a growing uncertainty regarding the strength of the recovery in the developed world. In this context, two phenomena occurred that triggered the current fragility. First, between July and August we witnessed the debate in the U.S. Congress on raising the fiscal debt ceiling – an illustration of the difficulties of the American political system to deal with their problems in this area – , plus the downgrading of their sovereign debt rating. Second, sovereign debt problems in peripheral Europe, notably Greece, expanded into central European economies such as Spain and Italy. In the U.S., the focus of the debate has shifted to the state of the economy and the possibility of a double-dip recession. The high levels of household debt and the difficulties to resolve the real-estate problem are yet to be resolved and will probably take a while. The labor market is being unable to pick up. The Central Bank and the fiscal authority, as in other developed economies, have no room for new stimulus measures to make up for the weakness of private demand (figure 13). The Fed announced that it would hold the policy rate low at least through mid-2013 and also a purchase of long-term bonds financed with short-term instruments. Since the Fed has the short-term rate at its lowest and the economy  4  BIS central bankers’ speeches  needs further monetary stimulus, this measure is intended to flatten the yield curve, reducing long-term rates.

This lower growth, beyond the possible effects of the adverse external scenario, responds mostly to the economy converging to trendconsistent growth rates, which we estimate to be around 5%. We are facing a very complex external scenario. In last Thursday’s monetary policy meeting communiqué we said that the deepening of international economic trends could shape a more adverse scenario than the baseline assumed in the September Monetary Policy Report, with potential consequences for growth and inflation in Chile, as well as for the orientation of monetary policy. Accordingly, we are paying close attention to external developments and we have the necessary flexibility to act whenever necessary. However, I would like to pause to examine two aspects. First, it is important for monetary policy not to react too little, too late. But just as important it is that it does not act haphazardly. A monetary policy that keeps changing signs because of mistaken diagnoses loses credibility. Potential delays can be compensated by being aggressive. That was the case between end of 2008 and beginning of 2009. We could have reduced the rate a couple of months earlier, but because inflation was so high and the economic outlook was so uncertain, it could have hurt the credibility of our monetary policy. In this context, a policy rate cut would have ultimately been slower and less effective. Once  BIS central bankers’ speeches  5  the severity of the situation was confirmed, we reduced the rate with unprecedented force and with much success.
From a pure monetary policy perspective, this is a healthy economy. But I’m acutely aware that not everyone is feeling the benefits of the 1/4  BIS central bankers' speeches  economy’s good performance. Recent work by my colleagues at the New York Fed crystalized the economic challenges faced by some of those living in New York City. Since the early 1980s wage inequality has increased in the United States, but that increase in inequality has been particularly sharp in large urban areas like this one. In New York City and Northern New Jersey, someone near the top of the income distribution earns seven times that of someone closer to the bottom. This contrasts with other parts of New York State, where the number is somewhere between four or five times.1 That’s not to say things are necessarily easier in areas with less inequality. In fact, many of the areas with less inequality are also challenged by limited job opportunities and declining populations. It does mean that not everyone is benefiting from growth equally. One of the reasons for this is that the type of growth in the city has disproportionately benefited one type of worker. Growth in New York has generated demand for highly skilled workers, who are often more highly paid and highly mobile. This drives up housing prices and contributes to gentrification, which often goes hand in hand with displacement. Words like “gentrification” and “displacement” sometimes can feel impersonal or cliché.

John C Williams: Fulfilling our economic potential Remarks by Mr John C Williams, President and Chief Executive Officer of the Federal Reserve Bank of New York, at the Association for Neighborhood & Housing Development 2019 Annual Conference, New York City, 11 April 2019. * * * As prepared for delivery  Introduction Thank you for that warm welcome. As you may be aware, last year I moved from San Francisco to take on the role of President of the New York Fed. In many ways California and New York are like different countries—the weather is a big adjustment, for starters! But through my meetings with community leaders and visits to the Bronx and Brooklyn, I’ve come to appreciate that we’re facing a lot of the same issues in my new home that I saw in the San Francisco Bay Area. The main topics of discussion—displacement as a result of gentrification, inequitable growth, and a critical shortage of affordable housing—are all ones we were grappling with on the West Coast as well. These issues are complex and challenging, and there are no easy answers, so I want to start by saying thank you for all the important work you do. There are a couple of topics I want to talk about today. The first is why the work you do is so important, and the second is the role I see the Federal Reserve Bank of New York can play in supporting you today, and going forward.
Much of achieving financial stability is about good regulation of banks – ensuring they have enough capital and liquidity to withstand stress in the market or economy, and ensuring that they aren’t running risks that will amplify a downturn, for example through weak underwriting standards or opaque structures. 4  Jordà et al (2015) demonstrate that asset price bubbles fuelled by credit booms increase financial crisis risks the most. Creditfinanced housing price bubbles are shown to present a particular risk. In contrast, equity price bubbles – particularly those unaccompanied by rapid credit growth – are typically less damaging and there have been numerous equity price bubbles that did not turn into financial crisis episodes. 3  All speeches are available online at www.bankofengland.co.uk/news/speeches  3  For non-bank financial firms, our focus has been more on their potential to impact others in the market – how under stress they can affect liquidity and pricing in the market, which can affect the financial system more generally. Market-based finance has grown rapidly and brings a welcome diversity to the sources of funding available to the real economy. But the structure of some investment funds – investing in assets with poor underlying liquidity in stress while at the same time offering daily redemption to investors – introduces liquidity risk. If many investors want to redeem within a short period, markets may not be able to absorb the necessary asset sales.

Indeed, having central banks mainly one instrument, the interest rate or the money supply, but not both, financial stability was mostly ignored. This is not the case of emerging market economies, where after many financial crises, the role of financial stability was always central in policymaking. Indeed, the most relevant aspect of financial stability was in the international financial transactions area. For this purpose, central banks, most usually, manage exchange rate policies, hold international reserves and dictate norms to avoid currency mismatches and external payment crises. In Chile, the Central Bank’s objectives are price and financial stability. The Constitutional Law explicitly establishes that “the Bank shall have as its purposes to look after the stability of the currency and the normal functioning of internal and external payments.” Indeed, the resilience of financial systems in emerging markets during the global financial crisis owes much to the fact that financial stability was already an important piece of the policy framework. Three issues I would like to discuss regarding financial stability and monetary policy:   First, was the crisis caused by monetary policy?   Second, what are the instruments for financial stability?   And third, what are the interactions between financial stability and monetary policy? Regarding the cause of the crisis, I do not think monetary policy, conducted, for example, on the basis of a Taylor rule was the main culprit. Very low interest rates in advanced economies induced high risk-taking as financial institutions were searching for yields.
Another measure of this type is the employment rate from the labour force surveys (AKU), which shows the proportion of the population of working age that is in employment. Figure 12 shows that the employment rate this year is close to the average for the years 2000–2008. 13  The assumed long-term GDP growth in Figure 7 after the end of the forecast period in 2013 is 2.3 per cent per year. 14  Reinhart, C. M. and Reinhart, V. R. (2010), “After the Fall”, National Bureau of Economic Research Working Paper 16334. 15  Svante Öberg, “Potential GDP, resource utilisation and monetary policy”, 7 October 2010. 6  BIS central bankers’ speeches  The Riksbank’s indicator of resource utilisation (the RU indicator) summarises about thirty such economic variables regarding levels.16 The RU indicator includes survey data from the National Institute of Economic Research’s Economic Tendency Survey for private services, the retail trade and the construction and manufacturing industries. In addition, capacity utilisation in the manufacturing sector from Statistics Sweden, the employment rate and unemployment from the labour market surveys, and unfilled vacancies from the Swedish Public Employment Service are also included. According to the RU indicator, resource utilisation is slightly higher than normal (see Figure 13). Figure 14 shows unemployment together with an average for the period 2000–2008 and an assessment of long-term unemployment.17 Seasonally-adjusted unemployment is presently higher than this long-term level. But assessments of long-term unemployment are fraught with great difficulties.

6  In the original Taylor rule, the policy rate is determined by inflation and the GDP gap. See Taylor, J.B., “Discretion versus policy rules in practice”, Carnegie-Rochester Conference Series on Public Policy, NorthHolland, 1993. 7  See the article “The driving forces behind trends in the economy can be analysed using a production function” in the Monetary Policy Report of October 2010. 8  It is important to make a distinction between labour productivity, which is defined as output per hour, and total factor productivity. 9  This is the logarithm of what is known as a Cobb-Douglas function: the relationship in the text applies to the logarithms of Y, K, H and TFP. BIS central bankers’ speeches  . Consequently,  3  In accordance with the production function, the potential level of production can also be divided up into potential total factor productivity, potential capital stock and potential hours. Deviations from the potential level can be estimated for each of the three factors affecting output – capital, hours worked and TFP. These deviations can then be weighted together to give a total output gap. Calculations of potential GDP This section describes the calculations forming the basis for the GDP and hours gap published in the most recent Monetary Policy Update.10 Figure 4 shows an estimate of actual and potential TFP. Actual TFP is estimated with the Solow residual. The TFP estimate thus captures all change in output that cannot be explained by the development of capital and hours.
As the activities of commercial banks have become increasingly diverse and complex, internal controls have become critically important to the sound and successful execution of banks’ strategic objectives. I want to stress this point as strongly as I can. As a former commercial banker myself, I know there is a powerful temptation for management to focus its attention and resources on the front office - those areas and individuals that generate profits for the institution. But if something goes wrong in the back office, it can quickly become the most important aspect of a bank’s operations. It is essential that sufficient resources, staff and managerial attention are devoted to the back office and internal audit functions. Firmly rooted on the foundation of good corporate governance and rigorous internal controls is the central importance of effective risk management. As I mentioned earlier, banking by its very nature is a business of taking calculated risks. If they didn’t take risks, banks could not perform their essential functions in a market economy. But sound banking also entails the prudent management of those unavoidable risks. Each banking institution must have in place the technical systems and management processes necessary to identify the risks associated with its activities - lending and otherwise - and to effectively measure, monitor and control those risks.

Ladies and Gentlemen, Let me now turn to the last success factor: inclusiveness, which is probably the weakest achievement among the three success factors so far. However, inclusiveness is something that has increasingly gained attention from Thai policymakers in recent years, as it was part  4  IMD, 2010. BIS central bankers’ speeches  3  of the root cause of political unrest. I believe that inclusiveness will be one of the long-term solutions for Thailand political stability. Yet, I should stress that inclusiveness has a different concept from equality. It focuses on creating equal opportunity rather than equalizing income. Income equality ultimately means that the reward system is independent of performance which erodes efficiency. Inclusiveness, on the other hand, refers to having equal opportunity which still preserves efficiency through reward incentive system while allowing the rich and the poor to have the same economic opportunity. As such, inclusiveness refers to equal access to public infrastructure such as education, fair competition and equal treatments of law and regulation to all. In this way, inclusiveness will provide equal exposure to yield the benefits from economic prosperity. Improving inclusiveness in Thailand will be a long process but some initiatives have already been put in place. These include decentralization of public spending, better access to education, informal sector debt alleviation, and better credit access for low income group.
Prices of Services (Quarterly Percentage Change) 7.87  8  2005 Q1  7 6  2006 Q1  5.19  5  4.264.08  3.85  4  3.02  3  2.41 1.751.80  2  1.27  1 0 Services  Rent  Transportation Services  Restaurant and Hotels  Other Services  Source: TURKSTAT, CBRT. Analyzing the course of prices in durable consumption goods, excluding gold prices, that have continued their high-rated upward trend within the framework of developments in international markets, the annual rate of increase of the said prices entered a downward trend as of August and this trend continued to accelerate in the first quarter of 2006. A reverse in the tendencies of both furniture prices, which may be an indicator of consumption demand and prices in the electrical and nonelectrical devices group, including technology-intensive goods open to competitiveness in general and susceptible to the exchange rate developments as well, are major determinants of this trend (Graph 5). Graph 5. Prices of Durable Goods (Excluding Gold) (Annual Percentage Change)  20 15 10 5 0 -5 Durable Goods (Excl. Gold)  -10  Furniture  -15  Electrical and Non-electrical Equipments  Mar-06  Jan-06  Nov-05  Sep-05  Jul-05  May-05  Mar-05  Jan-05  Nov-04  Sep-04  Jul-04  May-04  Mar-04  Jan-04  -20  Source: TURKSTAT, CBRT.

With the rapid adoption of technology, it is projected that 50% of all employees today will need reskilling by 2025, while critical thinking and problem-solving skills will grow in prominence. 1 The Institute for the Future has identified top skills that will be critical to combine with technological advancement, including novel and adaptive thinking, social intelligence and 1/3  BIS central bankers' speeches  cognitive load management. Meanwhile, according to an Organisation for Economic Co2 skills imbalances in Malaysia, employers reported operation and Development (OECD) studyon shortages in communication skills and social skills, such as social perceptiveness and social orientation. As a nation and at the firm level, we must therefore know where our comparative advantage lies, and how this competitive edge is affected by the global megatrends and technological advancements. We then need to prepare our people as only then can we successfully navigate and transform our economy and our organisations. Against this backdrop, it is important that organisations strengthen the end-to-end human capital framework and processes. In the new normal, organisations should look to pivot their human capital strategy to focus on integrating well-being into the design of work, leverage talent analytics to harness workforce potential, and embed adaptability and agility in learning and development (L&D). Allow me to elaborate on three L&D approaches that I believe will help organisations thrive in an age of technological disruptions. First, is the identification of core and emerging competencies that can meet an organisation’s objectives. In the Malaysian financial sector for example, specialist skillsets remain a priority.
Moreover, we expect the financial sector advancement to also contribute to the overall economic and social development of the country. Thus, the plan will also aim to promote a more complete financial access, ensuring that all needed financial services are available at appropriate prices to bankable users in all market segments. I envisage that these objectives would be achieved through policy measures under three main pillars. The first pillar will aim to improve financial institutions’ operational efficiency by reducing unnecessary costs that stem from outdated or overly restrictive regulations and approval process. In this regard, private sector’s input will be a key ingredient in improving the regulatory environment to one that is more conducive to business efficiency and innovation, while ensuring that prudential considerations both at individual and systemic levels are not compromised. The second pillar will look at improving efficient intermediary functions of the financial sector by increasing the level of competition through further deregulation and liberalisation. Deregulation would involve expanding business scope and enhancing the role of existing players, including banks, non-banks and other niche banks. One of the deciding factors for the optimal number and type of new players would be the value added that these new institutions, be they universal banks or niche banks, could bring to the financial system, such as technical expertise and product innovations. Set against these benefits, however, are potential risks to financial stability stemming from disorderly competition and exits. Thus, liberalisation considerations will be grounded on a robust supervisory framework and be appropriately sequenced and phased.

And, granted, there are many tasks ahead, we are a role model for many countries. In this conjuncture we must also set an example resolving urgent and critical problems and continuing building an ever more prosperous country for all. Thank you. 6  BIS central bankers’ speeches  Figure 1 World activity (*) (index, IV.07=100, quarterly series) 125  125  120  120  115  115  110  110  105  105  100  100  95  95  90  90  IV.07  IV.08  IV.09  Emerging  IV.10  Developed  (*) Regions weighted at PPP. Developed economies include: Australia, Canada, Denmark, the Eurozone, Japan, New Zealand, Sweden, Switzerland, the U.K. and the U.S. Emerging economies include Argentina, Brazil, Bulgaria, Chile, China, Colombia, the Czech Republic, Hong Kong, India, Indonesia, Israel, Latvia, Malaysia, Mexico, Peru, the Philippines, South Korea, Russia, Singapore, South Africa, Taiwan, Thailand, Turkey and Venezuela. Source: Central Bank of Chile based on Bloomberg, the IMF and statistics bureaus of respective countries.