samchain/econo-pairs-v1 huggingface dataset:
And yet – or maybe precisely because of this – there is still much heated debate over its scope and over what exactly it should be called. In order to better understand it, we need to rid ourselves of two mindsets: first, one of irrational fear, as non-bank finance also enables the financing of growth and innovation; and, in contrast, an over-idealised or “angelic” vision of the sector, as shadow banking does indeed carry risks and regulators have a role to play in mitigating them. 1. Overcoming our irrational fears: the benefits of market-based financing To overcome our irrational fears of non-bank finance, the words we use to describe it matter. Is it “shadow banking", with all the negative connotations this implies, or rather, as some regard it, “market-based finance” or “non-bank credit intermediation"? For the title of this FSR, we have chosen the term “non-bank finance” in its broadest sense. The work carried out by the FSB enables us to better determine its scope: the higher measure, which is entity-based [Other Financial Intermediaries or OFIs], puts the total at USD 99 trillion. However, those activities liable to pose a risk to financial stability, that is “narrow shadow banking",only account for USD 45 trillion, in other words a little under 30% of total non-bank finance. Market-based finance is still not very widespread in the euro area: [slide 3] it accounts for just 20% of total non-financial corporation debt, with the remaining 80% taking the form of bank lending. In the United States, these proportions are reversed.

Following the finalisation of the Basel III reform in December 2017, the main focus for financial regulation is no longer bank solvency, but non-bank liquidity. We nonetheless need to avoid making two mistakes. The first would be to favour one sector over another, be it banks or shadow banking: the existence of opportunities for regulatory arbitrage could to lead to the transfer of capital-intensive activities to less regulated, or even unregulated entities, which would be counterproductive. The other mistake would be to impose banking regulation on shadow banking, as the risks are not the same; in particular, the same 2/3  BIS central bankers' speeches  capital requirements cannot be applied. At the global level, the non-bank sector needs to be provided with microprudential and macroprudential regulations that are tailored to its particular business model and risks. With regard to macroprudential regulation, France is a pioneer in this field with its decision to introduce, as of 1 July this year, a measure regarding large enterprises that also takes into account their market debt. We shall publish details on how it will work this week. But we need to be honest with ourselves and admit that our experience of using macroprudential tools outside the bank sector is still very limited. One of our priorities in terms of regulation should also be to develop liquidity management tools for investment funds, and to refine the measurement of their leverage, two issues that, fortunately, the FSB has already identified.
On the other hand, they may lead to creation of bubbles that down the road may burst. Against this background, at the last meeting of G20 finance ministers and central bank governors it was acknowledged that technological innovation may be conducive to higher efficiency and inclusiveness of the financial system. Many risks, however, were also pinpointed with their proliferation – consumer and investor protection, market integrity, tax evasion, money laundering and terrorist financing. In this changing and challenging environment, staying aside is not an option for the Republic of Macedonia. To tackle the rising challenges, we have already drafted a new Law on payment services and payment systems (in cooperation with the Ministry of Finance) which transposes the PSD2 as well as other European Union relevant directives and regulations in the payments area. The new payment regulation aims to boost the competition in the traditionally bank dominated payments market by opening the entrance for FinTech companies which can provide innovative payment services as well as establish and operate new payment systems. At the same time, we assert our focus on maintaining financial stability by enhancing the resilience of payment market infrastructures which are being assessed against the Principles for Financial Market Infrastructures.

According to the Ernst&Young’s Fintech Adoption Index, one-third of consumers utilize at least two or more fintech services and they are becoming increasingly aware of FinTech as a part of their daily lives. The FinTech Adoption Index for services offered by FinTech organizations under five broad categories – money transfers and payment services, financial planning tools, savings and investments, borrowing and insurance, indicates that money transfers and payment services are continuing to lead the FinTech change, with adoption standing at 50% in 2017 and 88% of consumers anticipating of doing so in the future. Thus, the global payments industry is currently undergoing a paradigm shift driven by rapid advances, the influx of new technologies and evolving consumer behavior as digital generations come of age. The emerging FinTech enhances the transformative power of digital payments via innovation. The irruption of digital payments relates to its many opportunities. Embracing payments digitalization has the potential to substantially reduce the costs, increase the efficiency and enable broader access to payment services. With the rise of new payment digital technologies developed by the FinTech, and increasingly adopted by banks, consumers and merchants nowadays have a wide range of payment products to choose from. Innovation developments, such as instant payments, payment initiation services, person-to-person mobile payments and contactless proximity payments have the digitization process accompanied by innovative solutions in their essence. The payment innovations and digitization process also have an impact on the transformation of payment market infrastructures.
On the supervisory front, we need to address the cross-border as well as growing cross-sector integration in our financial systems. Finally, sound fiscal policies also play a significant role in maintaining financial stability. I am glad that this conference provides a good opportunity to discuss these policy challenges and their implications in more depth. Thank you for your attention. BIS Review 8/2004  3

The first years of our democracy were marked by economic difficulties, partly resulting from the international crises linked to sharp oil price increases and the lack of an anchor for inflation expectations in most developed countries. Nevertheless, this new Spain, democratic and integrated into Europe, never stopped looking outwards. Trade and financial flows and the movement of capital increased, and exports and imports rose from accounting for roughly 35% of GDP in 1986 to 66% in 2017. These steps towards modernisation would never have been possible without a society that was convinced of the fact that Europe represented prosperity and the future. The pro-European nature of civil society united Spaniards more strongly than their ideologies or political affiliations, and this sentiment has held firm despite the difficulties people experienced during the financial crisis. A recent survey by the Elcano Royal Institute shows that eight out of ten Spaniards believe that opening up markets provides Spanish businesses with good opportunities2. This is resounding proof that Spain benefits from the European Union in general, and the Economic and Monetary Union created by the euro area in particular. The annual growth in per capita income between 1977 and 1985, one year before Spain joined the EU, was 0.7%, well below the 1.8% enjoyed by the countries that would go on to form the euro area. However, between 1986 and 1998, before the euro was introduced, Spain’s per capita income grew at an extraordinary annual rate of 2.7%, above the average for future euro area countries of 2.1%.
The event will allow industry leaders to learn from one another and showcase their efforts and services to promote sustainability and highlight areas we must improve. Ladies and gentlemen, The Bank of Thailand is committed in our duty to maintain economic and financial stability amidst this VUCA environment and future disruptions. We are also committed to supporting the adoption of financial technology and promoting financial innovations to develop a financial system for the future that will improve productivity, immunity, and inclusivity. Such a 5/6  financial system will unlock our economic potential, ensure sustainable economic growth, and improve the well-being of our people. The Bank of Thailand is also committed to supporting regional connectivity through collaboration with other central banks, public agencies, and the private sector. Together, we can fulfill our vast potential, build strong safeguard against unintended consequences of disruptions, and develop a strong and inclusive financial system for the future. Thank you very much for your kind attention. 6/6

Along the normalization path, one should expect to see market corrections 2-7  and volatile asset prices. On top of this, rising US trade protectionism has raised concerns over global trade, investment, and production, and further measures could be retaliated. Global warming and geopolitical risks also increase in many regions of the world. Besides, rapidly changing technology could be disruptive for incumbents in many industries and also bring new forms of risks, ranging from cyber threats to strategic risks of existing business models. All these uncertainties necessitate that building sufficient immunity becomes a key consideration in any financial sector policy. Third is the notion of inclusivity. We need to understand that any financial sector policy without consideration for inclusivity cannot be sustained. This is especially important for Thailand and many countries in our region where income and wealth inequality is one of the most pressing social and economic issues. Any policy or action that does not pay attention to the issue of inequality can threaten long-term social and economic stability, as those with higher capital can more easily reap benefits from economic growth and new technology, leaving those without access to new technology or know-how further behind. Eventually, inequality in income, wealth, and opportunity can raise social polarization, resulting in political gridlocks as seen in many countries. Ultimately, policies that make improvements in all of these three key imperatives can uplift the real economy and standard of living of people as a whole.
Would an insurance-type payment be appropriate for firms that enjoyed lender of last resort access but did not have insured deposits? How would the Fed’s role, as the lender of last resort, be coordinated with the oversight responsibilities of the primary regulators? Conclusion Which path to go down – limit wholesale funding or backstop it more broadly – would depend in large part on the social value of the capital markets-based activities presently being  18  A lender of last resort finances with an appropriate haircut. 19  This was demonstrated recently by the European Central Bank’s Outright Monetary Transactions program  20  Several of the largest broker-dealers adopted bank holding company status in recent years, but Section 23A rules restrict the capacity of their banking subsidiaries to channel liquidity to their broker-dealer operations. BIS central bankers’ speeches  9  financed in unstable short-term wholesale markets and the utility of short-term wholesale funding for lenders. Of course, the choice might not be as black and white as this. Some activities undertaken by securities firms or other nonbank entities presumably are much more socially useful than others. In this case, legislators might deem that certain classes of securities firms should be granted access to a lender of last resort facility, but restricted in the scope of their permitted activities to those that do clearly create social value. The sheer size of banking functions undertaken outside commercial banking entities – even now, after the crisis – suggests that this issue must not be ignored.

Hence, we need to ensure sound regulation and oversight. Network and scale effects are as important as ever. With globalisation, the network effects are moving from the domestic market to the global. Regarding scale effects, I would argue that digitalisation has increased the fixed costs and lowered the variable costs, thereby increasing the large-volume advantage. Next-generation payment systems I will now turn to the present and focus the remaining part of my speech on the work at the Riksbank on developing the current infrastructure – building the payment systems of tomorrow, if I may say so. Naturally, this is not a solo task, but a joint effort involving many stakeholders, public and private, domestic and foreign. I will concentrate, however, on the Riksbank’s rationales for this work. They are to a large extent related to the lessons that I just highlighted. Before I do this, let me briefly reflect on what I said earlier about the higher pace of innovation in recent years. For those in the commercial sphere of payments, this has increased the risk of ‘falling behind’, we often hear. You need to master the new opportunities offered by the ‘era of digitalisation’ to avoid losing market shares. Add to this that network and scale effects tend to benefit suppliers that are first with a new solution or service. Here my point is that the same factor has also led to demands on central banks to be as vigilant as ever.
Ida Wolden Bache: Central bank digital currency and real-time payments Speech by Ms Ida Wolden Bache, Deputy Governor of Norges Bank (Central Bank of Norway), at Finance Norway's Payments Conference, 5 November 2020. * * * Accompanying charts can be found on the website. Please note that the text below may differ from the actual address. Introduction Chart 1 Changing payment landscape Thank you for the invitation to speak here today. For anyone interested in payment systems, this conference is an important meeting place – and that applies equally to this year’s conference, with its many digital participants. The payments landscape in Norway is changing. Technological advances, user preferences and globalisation are strong driving forces for change, offering opportunities but also posing challenges: How can we ensure the existence of an efficient system for payments in NOK while at the same time safeguarding security? How can we improve the common infrastructure for payment services? How can we best promote competition and innovation? The private sector, organisations and authorities must together and individually work to further develop the payment system. Norges Bank is responsible for promoting an efficient and secure payment system. This is why we are now assessing whether there is a need for central bank digital currency and whether Norges Bank should expand its operational role in real-time payment settlement. This is the theme of my remarks here today. A changing payments landscape Changes in payment patterns have accelerated during the Covid-19 pandemic.

Introducing a CBDC will involve such a substantial change in the monetary system that it will require a political decision. It could also involve the question of whether the Central Bank Act would have to be amended. What is the current situation? Norges Bank’s research is now in a third phase, to be completed in the new year. We are working on specifying the features a CBDC should have and considering a range of technical solutions. We are also drawing on other central banks’ experience and plans. Possible strategies for testing and experimenting with technological solutions are also being assessed. The core of a prospective CBDC system will be controlled by Norges Bank. Banks and other third parties could provide end-user services. This is a natural division of roles. Norges Bank would facilitate innovation through the design of the system’s technical core and regulatory framework. The consequences a CBDC could have for the financial system depend entirely on its design. The design could influence which claims the public decide to replace with CBDC and on what scale. If CBDC replaces cash, banks’ balance sheets will not be affected – the public will simply replace one claim on the central bank with another. If the public replaces bank deposits with CBDC, the consequences for the financial system could be more severe. Banks’ access to deposit funding could be reduced and banks’ funding costs could rise. During a financial crisis or other situations of high uncertainty, the public can suddenly withdraw bank deposits.
The ECB’s strategy review is very ambitious; not only does it analyse matters such as possibly adopting make-up strategies for past deviations of inflation from its target, but it also addresses additional topics such as the design and optimal use of the various monetary policy tools; the measurement of inflation; the interactions between monetary policy and macroprudential policy; the institution’s communication policy; and the impact of climate change, digitalisation and globalisation on monetary policy. All these facets and others covered by the strategic review may be relevant when delivering on our price stability mandate. 8  See, for example, Bernanke et al. (2019). See Box 2 of the “Quarterly report on the Spanish economy”, Economic Bulletin, 3/2020, Banco de España, for a description of this announcement and an assessment of its effects on financial markets. 9  10  Indeed, one of this review’s key topics will be the definition of the ECB’s price stability target. The current inflation target, aiming at inflation rates of below, but close to, 2%, may be reformulated. First, it may be necessary to clarify the specific level of inflation targeted, to make it easier for economic agents to understand. Second, making this target more symmetrical could also be possible, clarifying that the ECB would be as tolerant of overshooting as of undershooting.

By country, among the four largest euro area economies, the output loss was more pronounced in Spain (9.1%) than in Italy, France and Germany (down 4.5%, 4.1% and 4.2%, respectively). 1  Much uncertainty also persists regarding the intensity of the recovery in the fourth quarter of the year, in view of the recent course of the pandemic in Europe. The few short-term indicators available signal a slowdown in activity growth, which could be exacerbated – and even lead to contraction in at least some countries or sectors – by the widespread implementation of new measures to contain the health crisis. In the euro area, the PMI (the most leading indicator) for October fell by 0.5 percentage points (pp) to 50, standing at the boundary between expansion and recession. The pandemic is having a notably uneven impact, affecting primarily the services sector, whose PMI fell 1.1 pp to 46.9. Conversely, the manufacturing PMI rose 1.3 pp to 58.4. Similarly, the European Commission’s consumer confidence indicator also contracted. The latest ECB staff projections were published in late September; the baseline scenario indicates a drop in euro area GDP of 8% in 2020, followed by growth of 5% in 2021. However, the feasibility of these figures is in doubt, since one of the assumptions under this baseline scenario was that the epidemiological situation would not worsen in the near term. Developments since the projection cut-off date appear to contradict that assumption. The recent news regarding the availability of a vaccine early next year is obviously to be welcomed.
Preliminary figures indicate that approximately 130 million giro payments were made over the Internet during 2001. Between 1998 and 2000 the number of giro payments initiated over the Internet increased by a good 890 per cent. Today all Swedish banks offer Internet banks with rapidly growing range of services. Studies also indicate that Sweden is way ahead with regard to utilisation of Internet services. At the end of 2001 there were more than 3 million bank customers subscribed to Internet banks. For the banks the electronic payments entail considerable opportunities for rationalisation, probably to a much greater extent than could be foreseen just a few years ago. Some time ago I met the manager of a banking office in Stockholm who told me that he now had the same number of employees as five years ago, but his turnover was almost 50 per cent higher. This was largely due to the fact that the companies (including small and medium-sized companies) that had earlier been serviced by the bank could now carry out many of their transactions themselves via the Internet bank, which simplified their work and facilitated cash management. The companies could, for instance, with one click (as we say nowadays) pay all wages through a paperless transfer from the company’s account to the employees’ accounts and at the same time do the bookkeeping and pay slips, all without the long paper strips that needed to be manually checked.

There is a need to understand our competitive position, amplify our strengths and double our efforts in areas that we need to catch up. 16. For this purpose, the Financial Secretary tasked the HKMA in 2014, with the assistance of consultants, to conduct a reality check on Hong Kong’s competitiveness vis-avis our competitors and to devise a strategy to promote Hong Kong as the CTC hub in the region. 17. The reality check shows Hong Kong excels in many of the key factors that determine the competitiveness of CTCs. In terms of strengths as a business location, Hong Kong ranks third in the World Bank’s “Ease of Doing Business” ranking and third in the 2  BIS central bankers’ speeches  Global Financial Centres Index after only London and New York. We are also a leader in terms of access to capital markets. Hong Kong is a major international banking centre, with the presence of over 70 of the world’s top 100 banks. Our equity market is one of the most active in initial public offers. Benefited from the recent launch of the Shanghai-Hong Kong Stock Connect, the market capitalization of the Hong Kong Exchange has reached almost $ trillion as of two days ago. As of March 2015, it was the third largest exchange in Asia and the sixth largest in the world.