samchain/econo-pairs-v1 huggingface dataset:
Failure would suggest a degree of political dysfunction that could undermine U.S. economic leadership and could encourage global corporations and investors to invest elsewhere. Make no mistake: Credible fiscal consolidation will not be painless, no matter what form it takes. The burden will be felt across many sectors of the economy and we must expect that the resulting fiscal drag will exert some restraint on economic growth. Nevertheless, there is no reason why a carefully crafted plan would need to put the economic recovery at risk. A credible plan, after all, would likely have very positive effects on confidence. In particular, I believe that business investment would respond positively to a credible plan. More generally, reducing uncertainty over future tax rates, entitlements and other spending programs has to be a positive development in terms of reducing uncertainty that can constrain economic activity. By clarifying the rules of the road, a credible fiscal plan is likely to reduce the incentive of households and businesses to delay spending and investment. This would likely offset fiscal drag to a meaningful degree. 6  BIS central bankers’ speeches  Conclusion To sum up, while it is still too early for a precise estimate of the economic impact of Sandy, I expect a negative impact on fourth quarter national and regional economic growth, but a minimal long run effect nationally and regionally. This has happened during a period where too many people remain without the jobs that they need to help support their families and themselves.

Unsecured loans, in particular, are rising substantially. During phases of favourable economic development, there is greater willingness to grant unsecured loans. This was the case in 1999, when the economy found itself in a similarly robust state. There is a long-term correlation between loan volume and the M3 aggregate. Loan development typically lags behind the development of money supply. Monetary aggregates have grown only moderately for the past three years. The M3 monetary aggregate is currently growing at a modest 2%, while M1 and M2 are even registering a decline. The measured development of the monetary aggregates suggests a slowdown in lending. The development of the Swiss franc attracted considerable attention as it has weakened vis-à-vis the euro since the beginning of the year, although it has firmed against the US dollar. To gauge the effects of exchange rates on the economy, we need to make use of the inflation-adjusted exchange rate that is also weighted to take account of the importance of individual trading partners. Measured by this real, effective exchange rate, the Swiss franc today is at the same level as it was in 2000. In what way do exchange rate developments enter into our decision-making process? The exchange rate is important to the extent that it influences inflation, either directly via the prices of imported goods or indirectly via the business cycle. Volatility of the Swiss franc against the euro has been negligible as of late. This relative calm should not, however, deceive us. It is not necessarily going to last.
The benchmark interest rate in the euro area, at 1% since last May, has proven appropriate in a setting in which inflation expectations have remained anchored and in which the effects on the economy have been complemented, moreover, by those of the various exceptional measures adopted by the ECB Governing Council since October 2008. Such measures included most notably the unlimited provision of liquidity to the banking system at terms extending up to one year and a programme for the outright purchase of mortgage bonds and other similar securities issued in the euro area. Moving now to the Spanish economy, it is clear that the acute international financial crisis and recession in the main areas of the world fed through with great intensity to Spain, exacerbating the correction of the real estate market that had begun previously and prompting rapid job destruction. The fact that the powerful external contractionary trends coincided with the internal adjustment needed after a long expansionary phase has led to a decline in economic activity that is unprecedented in recent decades. On the data available, output fell by 4.2% year-on-year in the second quarter of 2009 as a result of the marked sluggishness of national demand, particularly private spending. Only the public-sector components of demand have held at positive growth rates, and in the case of public investment this was due above all to the roll-out of the Local Investment Plan last April.

The strong adjustment in spending is also manifest in a rapid reduction in the external deficit, which may have halved by 2009 from its level of close to 10% of GDP in 2007. Ideally, however, the spillover effect of the weakness of national demand on imports should be reinforced by a strengthening of the export base through the improved competitiveness of our companies. But we should not lose sight of the fact that the correction of these imbalances is coming about through a severe contraction in output that is exerting a most adverse effect on employment, as a result of the problems present in the functioning of the labour market, and on public finances. Job destruction, which was concentrated in the second half of 2008 in construction, subsequently spread both to industry and to market services, affecting temporary contracts most especially. After the sharp drop in employment in the closing months of 2008 and early 2009, the pace of job destruction has slackened, largely due to the effects of the launch of the Local Investment Plan. And since the dynamism of the labour force has held up well into 2009, the unemployment rate has skyrocketed from 8% in 2007 to almost 18% in the second quarter of the current year. The sharp employment adjustment has prompted a rise in apparent labour productivity from a rate below 1% in 2007 and the previous years to more than 3% in the second quarter of 2009.
Christian Noyer: Evolution of the regulation in Europe and in the United States – convergence or divergence? Keynote address by Mr Christian Noyer, Governor of the Bank of France and Chairman of the Board of Directors of the Bank for International Settlements, to the Paris-Europlace Financial Forum, New York, 18 April 2011. *  *  *  Strengthening financial regulation has been high on the agenda of the G20 since Pittsburgh in October 2008. Much has already been achieved both at the international level especially through the Basel Committee for Banking Supervision but also on national level with the Dodd-Frank Act in the US and the pending regulation for market infrastructures in the European Union. It is fair to say that the evolution of the regulation in Europe and in the United States has not always followed the same path in the past. At a time when our regulations are completely revisited and when many restructurations are taking place in the finance industry, rigorous consistency on both sides of the Atlantic is clearly needed if we want to avoid regulatory arbitrages and uneven level playing field which would be the seeds for inefficiencies and future disappointments. In my remarks today, I will briefly discuss the achievements on reforms of financial regulation. Then I will highlight some existing discrepancies between European and US regulatory frameworks that should be addressed. I. Regarding achievements in financial regulation: What has been completed so far?

Impact de la non compensation (netting) des opérations sur les dérivés sur le total bilan et les leviers des banques US  Augmentation du total bilan si non compensation des opérations sur dérivés (hors repos)  Impact du netting sur les ratios de levier des banques  Source : Risk.net (d’après Credit Suisse et Fitch)  BIS central bankers’ speeches  7
UK CCPs were able to provide clearing services without disruption. However, the episode highlighted a feature of the reformed system: in periods of stress, losses are realised faster. Market participants are forced to post sufficient collateral that reflects the market volatility promptly. This is key to addressing the build-up of counterparty credit risk that had been at the root of the devastating global financial crisis. But it also meant that some market participants faced a liquidity crunch and a different type of panic as investors scrambled to get their hands on cash (and particularly U.S. dollars). Margin calls in aggregate were large over the stress period. Initial and variation margin increased significantly, with the increase in initial margin (IM) at major global CCPs totalling around $ in March 2020 and the increase in variation margin (VM) flows peaking at $ during the height of the stress in mid-March. [4] Central banks had to step in to restore market stability in a big way. Over the course of 2020, G10 central bank balance sheets rose by $ trillion. [5] Had central banks not acted, the financial stability consequences could have been severe. Russia-Ukraine The first quarter of 2022 saw another episode of unprecedented volatility across financial markets as Russia invaded its neighbour. Once again, we saw shocks, this time in some commodity and energy markets. Again, we saw big margin calls at CCPs. Losses (and corresponding gains) on derivative positions spiked across February and March 2022, primarily in markets experiencing the largest shocks.

This will make the UK financial system safer. And we are already practicing what we preach. As a home supervisor for UK CCPs throughout the recent stress events I mentioned earlier, cooperation with host authorities has always been at the front of our mind. We held 10 colleges over the past two years. Where necessary, we shared daily updates on developments we were seeing. Together – and working with all of you in industry, I hope that global CCP regulators can find ways to begin to address the lessons I have just laid out: tackling the side effects without sacrificing the cure; dealing with situations in which history is not a good guide to the future; and understanding the structural factors that can lead to big price moves. Addressing the issues we have seen in March 2020 and again in 2022 is both urgent and important. Cooperation will give us a strong foundation on which to enhance the crucial role CCPs play in supporting global financial stability as we address vulnerabilities that have become evident in recent stress. I am grateful to Sarah Crowley, Chandima Wijerathna, Dan Wright, Don Payagala, Michael Wood, Pavel Chichkanov and Shriya Mrug for their help in preparing these remarks. I am also grateful to  Page 7  Jon Cunliffe, Andrew Hauser, David Bailey, Nathanael Benjamin, Sarah Breeden, Andrea Rosen, Imane Bakkar, Martin Arrowsmith, Simon Morley, Justin Jacobs, Barry King and Jaynika Patel for their helpful comments. 1.
If inflation is higher than expected, borrowers benefit from the value of the debts being eroded, while lenders and those with large savings are correspondingly disadvantaged. This type of arbitrary distribution between lenders and borrowers was common during the 1970s and 1980s. The inflation target, together with the reforms of the fiscal policy framework and the changes in wage formation in the 1990s, has contributed to inflation in Sweden both coming down to a lower level and becoming more stable than before. The same has happened to inflation rates around the world. It is therefore not surprising that the question of the distributional effects of inflation and monetary policy disappeared from the economic policy debate.   I would like to thank in particular Björn Andersson, who has helped me produce this speech. Carl Andreas Claussen, Charlotta Edler, Cecilia Roos-Isaksson, Stefan Laséen, Tomas Lundberg, Marianne Sterner, Ulf Söderström and Anders Vredin have contributed with valuable comments. 1 [14]  Distributional effects topical again However, in recent years the question has become topical again. One reason for this is a growing insight that the distribution of income and wealth may have considerable significance for the effects of monetary policy on the economy as a whole. And it is therefore important to understand the relationships better. Another reason why this has become topical again is the rising asset prices and the effect that monetary policy has on the distribution of income and wealth.

Expansionary monetary policy affecting asset prices in this way is actually a part of the transmission mechanism for monetary policy, that is, the way that monetary policy spreads through the economy. But the effect on asset prices is not the objective of the policy. The objective is that the expansionary policy – through the effects on interest rates, asset prices, exchange rate, access to credit, expectations and so on – will in a couple of years contribute to increasing activity in the economy and bringing up employment and inflation. It is important not to lose this perspective in discussions of the distributional effects of monetary policy, as it broadens the spectrum of effects to more than just those coming through asset prices. Moreover, it points to the difficulties in determining the size of the distributional effects of monetary policy. One such difficulty is assessing what should actually be considered an effect of monetary policy and what is rather an effect of the conditions for monetary policy having changed. In a system like the national economy, it is not an easy task to distinguish between cause and effect. The Riksbank does not operate in a vacuum; it adapts its monetary policy to changing circumstances. 3 Moreover, if monetary policy were not adapted to new circumstances, this would also have distributional effects.
An additional insight is that the simultaneous occurrence of foreign exchange rate crises and banking crises is probably the single most important reason why some countries have suffered much deeper recessions when their currency pegs collapsed or came under a severe speculative attack. The contractionary shock to most European countries in 1992-93 was clearly much smaller than for Sweden and Finland in the early 1990s and for Mexico in 1995 and Asian countries in 1997-98. 3  BIS Review 88/1999  Thus, authorities in countries that receive capital inflows should prepare for the day when the movement might reverse. Countries that are vulnerable in this regard should carefully consider the adequacy of their foreign exchange reserves, particularly in relation to their short-term external debt. Since large numbers of countries cannot build up their reserves by increasing their trade surpluses simultaneously, this would seem to argue for greater use of contingent lending facilities provided by the private sector. Given such arrangements, recourse to the new IMF Contingent Credit Lines would then add public sector to private sector affirmation that the domestic policies being followed by the borrowing country are sensible and sustainable. … but the international dimension should also be recognised To say that the key to avoiding future crises in emerging markets must be found in domestic reforms is not to deny that part of the solution may still lie in measures that change the way in which international financial markets sometimes operate.

In 2013 we overhauled the information compiled by the Central Credit Register, switching more towards a very complete granular database in order to strengthen our micro- and macro-prudential supervisory mechanisms. We are also fortunate to have, since the eighties, an exhaustive database of the annual balance sheets and the profit and loss accounts of Spanish firms (the so-called Central de Balances), whose inception was one of the landmarks as far as the set of statistics produced by Banco de España is concerned. The database also contains a very valuable sample of firms voluntarily providing quarterly information. Moreover, the balance of payments and the international investment position have been historically produced by relying on mainly micro information. And from the outset of this century we have conducted every three years (which will be every two years in the future) a wave of the Survey of Household Finances, which offers a very rich picture of some of the key economic and financial decisions taken by Spanish households. All this micro information helps the Banco de España perform our functions and allows us to address flexibly both analytical work and statistical compilation, under our multi-purpose remit. Moving towards a statistical landscape broadly relying on micro data requires deep changes in a number of processes. As automation is of the essence, new techniques need to be used to manage these data (including the necessary quality checks) and staff skills have to be upgraded accordingly.
It also appears to have grown in the second half of the 20th century. 39 Evidence from the US over the period since 1880 suggests a similar pattern. Stock market evidence suggests that agents may be undervaluing cash flows by up to 40% each year. Or, put differently, if cash flows six months ahead are undervalued by 20%, those occurring 5 years ahead may be undervalued by up to 90%. The stock market appears to be a quite defective Pigouvian telescope. Patience and jobs If impatience is part nature, part nurture, it ought to have implications beyond finance. So take another key inter-temporal decision – the choice of job. Like financial assets, the market in employment is likely to have become more liquid and information-efficient over time, facilitated by the growth of job search services. But as with finance, information and liquidity has the potential to cause over-trading. Consider, for example, the market for CEOs. Their positions are likely to be particularly at risk from short-term performance evaluation in capital markets. And as with holding periods for financial investments, CEO tenure patterns have changed strikingly over recent decades. In 1995, the mean duration of departing CEOs from the world’s largest 2,500 companies was just less than a decade. 40 Since then, it has declined. By 2000, it had fallen to just over 8 years. By 2009, it had fallen to around 6 years. This pattern is replicated across regions, but is marked in North America and non-Japan Asia.

One thing people often misunderstand about inflation targeting is that we only care about inflation. This misunderstanding is propagated in the media through a narrow interpretation of the regime by some of its critics. For example, in a widely quoted article, The Failure of Inflation Targeting, the 2001 Nobel Prize winner, Joseph Stiglitz writes that inflation targeting implies “whenever price growth exceeds a target level, interest rates should be raised” and hence is destined to failure. This is certainly not true since all inflation targeting central banks look as well at indicators of real economic stability in a balancing act. The framework of inflation targeting as is currently practiced is flexible to accommodate secondary policy objectives. One needs not to look further than our MPC statements that the Bank of Thailand is also concerned about economic growth in addition to price stability. Other things that we do look at include external stability, financial conditions of households, financial institutions , and corporate sectors, and fiscal sustainability. Another point that I would like to stress here is that, in the context of a small open economy like ours, taking care of inflation also has a positive impact on growth through a competitiveness channel. This works through the real effective exchange rate which takes into account our inflation differentials with our trading partners and trading competitors. Despite the recent weakening of the baht, Thailand’s real effective exchange rate actually appreciated due to the surge in inflation.
If they are asked for units to be paid out they have to do so within two or three days. I see a potential risk of liquidity imbalance. That is what worries me the most at the moment. And, while it may not technically be a secondary effect of monetary policy, because its causes are structural, I am concerned by the banking sector’s low profitability. Are you in favour of changing or widening the ECB’s mandate? Or of defining more precisely what is below, but close to, 2%? We have to look at that, yes. The ECB set out its strategy in 1998 and revised it in 2003 and, while it can’t be a change of mandate, since that is defined in the Treaty, we could revisit the definition of price stability. And what are the steps to achieve that? I am in favour of starting the discussion, but we haven’t had it. The President has announced it, but this is not a matter of one or two Governing Council meetings; it is something that must be done without haste, but decisively. What about “helicopter money”, i.e. giving money directly to citizens? No, that has never been considered. But should it be considered, just like changing the mandate? No, absolutely not. There is a lot of talk currently about “Japanification”, about secular stagnation. Add to this demographics and the fact that there is a smaller working population with lower productivity than before. What scares you the most?

All of this in an environment of lower growth, zero rates and stimulus plans. When you were in government you joked that you slept like a baby, in that you woke up crying every two hours. How are you sleeping now? Well. Very well! I wouldn’t wish what happened in 2012 on my worst enemy. The situation now is totally different; back then we were on the brink of collapse. The Spanish economy, the Italian economy, doubts about the integrity of the euro… the situation of the Spanish banking industry was terrifying and contagion was spreading to the Treasury. It was a dramatic situation. I don’t think there is going to be a recession in Europe, that’s very unlikely. But yes, I am worried that we 2/5  BIS central bankers' speeches  will have two or three years of subdued growth, of below-potential growth. That is what is worrying me at the moment. And that this subdued growth may mean that the price stability objective is not met. Monetary policy is not the philosopher’s stone, it cannot be used to fix everything. Other policies are needed. So do you echo the calls of Presidents Draghi and Lagarde for countries with fiscal space, above all Germany, to boost spending and investment? This is important, yes, but my proposal goes further than that. Our current system of national fiscal policies and national budgets, with a set of rules like the Stability and Growth Pact, is not sufficient.