samchain/econo-pairs-v1 huggingface dataset:
But let me be equally clear in setting out that a broad-based transition to the most robust overnight rates – for sterling that is compounded in arrears SONIA, underpinned by deep underlying markets, will support a stronger more transparent financial system and ultimately benefit all market participants. Moving to the most robust reference rate Despite being the London Inter Bank Offer Rate – transition is of course as much an international, as it is a domestic effort. Indeed John and I have co-chaired the FSB group co-ordinating work on the transition to more robust benchmarks for a number of years now, ensuring co-ordination between authorities from the five Libor currency jurisdictions but also more broadly across the wide range of jurisdictions that are exposed to the Libor benchmarks. One of the challenges of transition is how embedded Libor has become in our economies and indeed how widely it is used across a broad range of retail and wholesale financial products – far broader than originally envisaged. Clearly alternatives to Libor need to work for domestic markets but given Libor’s role in many of the products and services that interconnect our financial systems, it is important a robust transition is delivered across all the Libor currencies. And the signs here are positive, industry groups in each jurisdiction were established to recommend alternatives to Libor. It is no accident that each industry group has, in my view, taken the sensible decision to recommend risk-free rates.

6 I shall not go further into this, but merely wish to point out once again how important it is to analyse the driving forces behind inflation to be able to explain the monetary policy conducted. This means that we from time to time highlight different measures of inflation. In the current stage it is thus important to distinguish the effects of our own measures which we have implemented to alleviate the effects of the financial crisis on international growth and thus on growth in Sweden. 5  For a detailed discussion of this, see “Should monetary policy stabilise resource utilisation?” Economic Commentary No. 1 2008, Sveriges Riksbank. 6  Inflation measured in terms of the CPIF, which disregards changes in mortgage rates, is around 1.6 per cent on average in 2009. If one also excludes energy costs, the average for 2009 is 2.2 per cent. BIS Review 38/2009  5  Monetary policy is dependent on a functioning transmission mechanism Inflation is affected by the Riksbank’s changes in the repo rate through what is usually known as the transmission mechanism. This influence goes through several different channels, such as short and long real interest rates, the exchange rate and the supply of credit. The impact occurs with different degrees of delay. The repo rate is the interest rate the banks pay when they borrow from or deposit money in the Riksbank for one week against collateral.
But when the value of the underlying subprime loans  BIS central bankers’ speeches  1  collapsed in 2006/2007, it became clear, on the one hand, that the risk had not disappeared and, on the other, that by increasingly dispersing this risk, it was everywhere. This was the crux of the first episode of the crisis. Investors then realised that these products were opaque and toxic and they became distrustful. The collapse of a number of hedge funds in summer 2007 as a result of these products led to a freeze in interbank markets and banks stopped lending to each other. In September 2008, these dynamics and the attendant loss of confidence culminated in the folding of the major US investment bank Lehman Brothers. The seizing up of the interbank market and the magnitude of the shock for banks was even greater and had an immediate impact on the real economy. Lending to the economy declined, investments and international trade collapsed and all regions of the world went into recession at the end of 2008. This is a brief recap of the first leg of the crisis. You can see that at the outset it was a real estate and financial crisis whose epicentre was in the United States. Epicentre No.2: Since 2009, the euro area But how did this first crisis transform into the euro area crisis that has been raging for the past two years? In two words, the answer is public debt.

Having said that, the HKMA will of course have its own views on what levels of sophistication of risk management we would expect to see in different types of banks. While we won’t mandate particular approaches, we will expect to see levels of risk management that are commensurate with the types and levels of risk being run. So, for example, we won’t necessarily expect even a large bank with significant credit risk to implement advanced IRB. But we would expect a bank of such a type to have a fairly advanced internal credit rating system. As another example, we would generally expect banks with a significant level of market risk to implement a models based approach to measuring the risk. BIS Review 31/2003  1  This flexible approach - in contrast to the approach being adopted by some other supervisors, who are mandating that particular approaches be adopted by particular types of banks - is, we feel, the most appropriate approach for Hong Kong. In Hong Kong we have a wide variety of banks, RLBs and DTCs. We have different nationalities. We have different sizes. We have banks that focus on the retail market, and ones that focus on the wholesale market. We have banks that specialise in mortgage lending, ones that specialise in SME lending, and ones that are jacks of all trades. It’s perfectly appropriate, therefore, that with such a wide variety of banks there should be a wide variety of credit risk management and other risk management practices.
The empirical picture  The different types of problem I have just described have to a varying extent probably characterised Japan in the 1990s, several countries in Southeast Asia recently and, it seems, Sweden in the late 1980s and early 1990s. There are also plenty of examples earlier on of similar periods of economic setbacks in various countries. Experience shows that the subsequent process of adjustment can be very troublesome and sometimes protracted. Inflation is markedly subdued and there is even a risk of a period of deflation. The structural changes that affected the Swedish economy in the second half of the 1990s seem to have been confined to a series of price effects in connection with the deregulation of electricity and telecom markets in particular. Inflation has therefore been lower than would otherwise have been expected from resource utilisation in general. In keeping with the rule of action, in recent years the Riksbank has implemented a stimulatory monetary policy and systematically aimed at the target one to two years ahead. Partly, but not solely, for this reason, the instrumental rate has accordingly been lower than in many other countries. On the other hand, productivity growth has not accelerated as it has in the United States. The rate in the corporate sector has admittedly been somewhat higher than in the 1980s but it had already increased in the early 1990s when the economic crisis eliminated less competitive and low-productive firms. In the second half of the 1990s there was no further improvement in productivity growth.

The contrast between this concern and the example and experience of Mr Ali, which we celebrated that evening in Glasgow, could not have been more pronounced. Whatever the difficulties he faced of social disadvantage, and no doubt, too, of some degree of ethnic prejudice in the UK - Mr Ali overcame them. From modest beginnings, he moved on to build a whole series of substantial businesses not simply to his own benefit but to the great benefit, in terms of both the goods and services, and the income and employment which he provided to the community which adopted him. But, beyond this impressive business achievement, he also made a great contribution in terms of community service and charitable involvement both here in the UK and in relation to Pakistan. Now this example of the contribution that ethnic minority business - given the proper opportunity and encouragement - can make to our economy is certainly not unique. The Bank of England's investigation some 18 months ago into the availability of finance to ethnic minority firms suggested that while the ethnic minorities represent some 5% of the UK population, they controlled some 7% of UK businesses and accounted for around 9% of new business start-ups. Those national figures relate to 1997, so they are a little out of date.
While some progress has been made in working out what the problems that need to be addressed consist of, we are still a long way from seeing results, and with the absence of major speculative attacks in the last few months, we are in danger of being lulled into a false sense of security. Conclusion 23. To summarise, the problem to be tackled is essentially this: capital flows are moving through a financial system that is now to a large extent global and borderless. Market liberalisation and advances in information technology mean that the system will continue to develop in this direction. Yet the machinery that regulates this system is still largely operated by individual governments. There is much that governments can do, and are doing, on their own to help ensure that markets can channel the benefits that capital flows bring while minimising the risks. But managing these risks – which lie mainly in volatilities exacerbated by high volume and high velocity, and occasionally by deliberate viciousness – may ultimately be beyond the capacities of individual jurisdictions. Crisis management and rescue packages are expensive and disruptive methods of clearing away the damage and picking up the pieces. The only effective long-term solution lies in prevention through collective action to reform the international financial architecture and ensure that free markets continue to be able to function as they should.

First, despite the increasing integration of the world economy, which might appear to reduce the effect of national policies, the nation state has in fact flourished since 1945. The collapse of ideology and empire, and the triumph of the ideas of a liberal market economy, have been accompanied by an extraordinary expansion in the number of countries in the world. In 1946 there were fewer than 80 countries. Now there are 192 members of the UN. Much of that increase represents the division of empires, such as the former Soviet Union, into new states, as well as growing ethnic separation. Most of these new countries were not “present at the creation” and see no reason why they should acquiesce in governance arrangements made in their absence. And the economic weight of countries has changed greatly since the post-war international institutions were set up. In 1950, Asian countries accounted for a sixth of world GDP measured at purchasing power parity. Now they account for more than a third. Second, the world economy is very different today than when the IMF, the World Bank, and the other international economic institutions were set up. At the end of the Second World War, the international monetary system was built around fixed exchange rates and controls on capital flows. The rules of the game were simple. Countries were supposed to balance their current account. When “imbalances” arose, they were under an obligation to correct them. In practice, however, the obligations on creditor and debtor countries did not prove to be symmetric.
Examples of principles of particular relevance include:   Principle 8 (‘market participants should be clear about the capacities in which they act’, including to their own clients);    Principle 9 (‘market participants should handle orders fairly and with transparency in line with the capabilities in which they act’ – which assigns specific duties to clients, including being aware of  2  https://www.globalfxc.org/  3  eg https://www.newyorkfed.org/fxc/index.html, https://www.bankofengland.co.uk/markets/london‐foreign‐exchange‐joint‐standing‐committee or http://www.sfemc.org/ 4 https://www.theinvestmentassociation.org/assets/files/press/2018/FX%20Global%20Code_summary.pdf 5  https://www.theinvestmentassociation.org/assets/files/consultations/2018/20181105‐guidetosigninguptothefxgobalcode.pdf  6  https://www.treasurers.org/technical/codes 6  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  6  responsibilities they should expect of others, being aware of risks associated with the transactions they request and undertake, and regularly evaluating the execution they receive);   Principle 12 (‘market participants should not request transactions… with the intent of disrupting market functioning or hindering the price discovery process’); and    Principle 31 (‘market participants should have independent processes in place to mark-to-market trading positions to measure the size of their profit and loss and the market risk arising from trading positions’)  Throughout the whole Code, however, there is no suggestion of a ‘one size fits all’ approach: for buy-side firms, as for all organisations covered by the Code, proportionality is a key principle.

These are only some of the many dynamics that we are experiencing at a rapid pace today. What these underscores to all of us, is the importance of continuous learning so we can continue to adapt and evolve. I am sure the knowledge you have learnt in your respective courses will provide you a strong foundation as financial planners professionals. However, to keep pace with the changing environment you must have a lifelong learning mindset. It is important to keep abreast with the latest economic developments and continuously update your information set so that you are able to provide the most optimal advice to your clients. Apart from providing information and filling the gaps in financial knowledge, financial planners play the important role of defusing biases that lead to common financial mistakes among consumers and help mediate in joint decision-making. This is especially true for vulnerable consumers who largely lack capability to fully understand and comprehend the risk-return assessments, not only of complex financial products and services but sometimes even those basic ones. One financial decision can have far-reaching consequences on their current and future livelihood. It is therefore crucial not to downplay the importance of professional advice in improving the quality of life and the wellbeing of individuals and households.
Then, he said “Ah, so it’s like running between the wickets!”  14  BIS central bankers’ speeches  Mr. Chairman, I sincerely hope my address to you today, helped you and everyone here present, to also understand this complex and delicate relationship, in the same manner my friend did! Thank you. BIS central bankers’ speeches  15

Spain seemed to be in a different position with a positive fiscal balance, though this was mainly due to unsustainable high growth in the construction sector. This illustrates the first question, which is how to solve time inconsistency in fiscal policy. It is easier to follow the prescriptions of Keynes in bad times than in good times. This asymmetry may lead to an increase in budget deficits and sovereign debt over time, also referred to as the fiscal bias. As a result, many countries are forced to tighten policy in a period when the real economy would certainly benefit from further stimulus. The crisis caused fiscal balances to deteriorate by 8–10 percentage points of GDP. There is an immense difference between encountering a shock of this magnitude from a positive fiscal balance of 4 per cent and encountering it from a negative fiscal balance of 4 per cent. A similar time inconsistency problem, the inflation bias, has been a much debated issue in monetary policy. The solution has been central bank independence. The results have been fairly good. The question remains, is there a lesson to be learnt in the fields of fiscal policy and banking regulation? This crisis has been very benign to the Norwegian economy. One of the reasons, I believe, is that we had a national banking crisis only 20 years ago. Many of the executives in banks, corporations and government this time, had experienced the previous crisis. Hopefully, they had learned some useful lessons.
If such a downturn were to persist, the economy would risk suffering permanent damage as unemployed workers drop out of the labour force, for example, or as relevant skills are lost. In this sense, monetary policy can safeguard the economy from structural damage and help avoid permanent losses to potential output. In the euro area, since the onset of the financial crisis, monetary policy has been at the forefront of efforts to sustain a healthy rhythm of economic activity and ensure that the price stability objective is reached. The ECB has used a range of tools in its policy arsenal to support aggregate demand in the euro area and secure price stability. During this period, paradoxically, the greatest danger that the Governing Council had to confront was not the one that the founders of the single currency had feared. The ECB is institutionally hard-wired to combat inflation. This was the key preoccupation of the  architects of the euro, born out of the German experiences with hyperinflation, both during the inter-war years and in the aftermath of the Second World War. From this preoccupation stem essential features of the set-up of the single currency area: a fiercely independent central bank, with a clear mandate to pursue price stability and robust safeguards to stop the ECB from monetising budget deficits, historically the root of runaway inflation. During the financial crisis, however, the nature of the problem the ECB faced was entirely the opposite.

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Our money” was aimed at familiarising all the European citizens with their new banknotes and coins (and their security features) and, by doing so, it helped them identify the obviously fake banknotes. All institutions concerned, both national and European, are co-operating closely to prevent and fight counterfeiting. Right now, counterfeit banknotes are scarce and conspicuous. The credibility of the Eurosystem and of the single monetary policy, and the successful changeover to the euro represent major achievements. They certainly contribute to the efficient functioning of EMU and to European economic and financial integration, as I will explain it right now. ***  EMU: a balanced concept fostering economic and financial integration EMU is an economically sound and well-grounded concept. A few years ago, it was necessary to convince a great number of sceptics that the euro would really be launched. The opinion that the single currency would never exist has of course been disproved by the facts. Nevertheless, objections are still being raised from time to time, on the alleged grounds that the euro area economy comprehends inconsistencies that could endanger and challenge the viability of EMU, all the more so since the European Union is about to welcome new members. Some observers thus claim that the lack of co-ordination between European economic policies, in the absence of a political federation, is likely to deprive the area of an appropriate policy-mix.

In short, the balance of risks between inflation being above or below target in the medium term shifted decisively to the downside. That was the background to the internationally coordinated reductions in interest rates in early October and the aggressive cut of 150 basis points in Bank Rate in November, the largest reduction in official interest rates since 1992 (indeed I believe it was only the third time Bank rate had been cut by 150bp since the Bank was founded over 300 years ago). Even so, our latest medium term projections for inflation show inflation remaining below target in the medium term and suggest further reductions may be necessary (Chart 7). Of course, there are large uncertainties around that projection; more so than usual. In particular, they take no account of any fiscal measures that the Government may announce next week. Just as we had to change gears on monetary policy, so we needed to change our approach to the banking sector. The tripartite authorities – the Bank, FSA and Treasury – were criticised for the handling of Northern Rock and for being slow off the mark when the crisis started in 2007. But we learned from that experience. We have established new ways of providing the market with the liquidity that it needs. And, as the crisis has widened, we have dealt with vulnerable and failing banks, such as Bradford and Bingley, more speedily and cleanly.