samchain/econo-pairs-v1 huggingface dataset:
If the debt securitized by the government-sponsored enterprises (GSEs) is included, the amount of securitized credit had reached $ trillion in 2007. Clearly, the shadow banking system was not in the shadows, but was a market-based credit intermediation system that was at least on par with the banking system in terms of its importance to the economy. Moreover, this system was not completely separate from the traditional banking system. In fact, much of the risk that the shadow banking system had assumed was ultimately borne by banking organizations. Banks had provided backstop lines of credit and had other contractual or reputational reasons to absorb structured credit and other assets back onto their books once they could not be financed in the shadow banking system. In effect, regulated banks functioned to some degree as the lenders of last resort for the shadow banking system. The entire financial system, both in the banks and outside, got caught. It was holding too much risk on too narrow of terms, it did not have sufficient capital, and it was too leveraged and dependent on short-term funding. As it became clear that the value of the U.S. housing stock had to decline considerably, these financial conditions complicated the adjustment. Indeed, what started as a seemingly narrow concern about subprime residential mortgage-  BIS Review 40/2010  3  backed securities cascaded into a widespread and abrupt re-pricing of credit more broadly and a desperate scramble for liquidity.

There were signs of strain in particular segments of these markets, such as dislocations in forward exchange rates and a notable decline in the liquidity of currency swaps. However, market participants were generally able to execute trades and manage currency exposures in these markets on an uninterrupted basis. The resilience of foreign exchange markets owed in part to the availability of CLS Bank for  2  BIS Review 40/2010  eliminating time gaps in the settlement of different currencies, to the efficient collateral exchange achieved through credit support annexes and to the standardization of trade documentation. Credit intermediation and market disruption While those capital markets demonstrated meaningful resilience to financial stress, that was not the case for other parts of the financial system – namely, those involved in more complicated forms of credit intermediation. Many of the most acute problems were driven by a build-up in leverage in which large amounts of opaque, illiquid, long-term assets were financed by short-term liabilities. These activities took place both in traditional financial intermediaries and in what is often referred to as the shadow banking system. The shadow banking system performs a function similar to that carried out by banks and other financial institutions. In particular, it takes the short-term, highly liquid investments that households and other investors want to hold, and it uses them to fund the longer-term, relatively illiquid loans that businesses and households demand to finance their economic activity.
•  The government budget – growth in public spending – influences the real krone exchange rate and the size of the internationally exposed business sector in the long term. •  Wage formation and economic structures and incentives determine how efficiently labour and other economic resources are used. Even if inflation fluctuates somewhat from one year to the next, inflation has remained fairly close to target over time. Inflation was particularly low in the years around the turn of the millennium when cheap goods flowed from Asia into our country while productivity in the business sector grew sharply. The rise in prices for domestically produced goods and services was also low. Interest rates were cut in response to lower inflation. Economic agents could then expect inflation to gradually move up to target over time. Growth could also remain high for a period without a rapid rise in inflation. Low interest rates made it possible for us to make use of the potential for higher consumption and investment. There are now signs that price and wage inflation is on the increase. Higher food and energy prices are fuelling inflation in other countries. Thus, we cannot assume that prices for imported goods will continue to fall. Moreover, domestic productivity does not seem to be improving as quickly as earlier. The rise in prices is therefore likely to quicken for goods and services produced in Norway.

Willem F Duisenberg: New economy, financial markets and monetary policy Speech by Dr Willem F Duisenberg, President of the European Central Bank, at the meeting of the Zürcher Volkswirtschaftliche Gesellschaft, Zurich, 19 May 2003. *  *  *  Introduction Ladies and Gentlemen, I am delighted to be here to address you this evening, and I should like to start by thanking the Zürcher Volkswirtschaftliche Gesellschaft for inviting me to do so. Being trained economists, you all know that in the course of the past century, monetary theory has faced significant challenges from various angles - the Keynesian revolution, the neo-classical synthesis, the monetarist counter-revolution, the emergence of new classical economics with the introduction of the concept of rational expectations, and real business cycle theories. Similar to the experience of monetary theory, monetary policy has had to cope with major challenges as well. We all know that the economic and financial environment in which monetary policy has to operate is continuously changing. During the past few years - as has been rather obvious - these changes have included the discussion about a “new economy” and, driven by the interrelated processes of financial liberalisation and financial globalisation, the growing importance of financial markets. You may wonder why someone should raise the topic of the “new economy” again, as it has been discussed so extensively by many, including myself, on many an occasion before. Is this not a topic which has actually become rather “old” by now; another chapter in the history books of economic science?
In this respect, cryptoassets or cryptotokens are one of the most striking developments in this area, going by the extensive media coverage some of them – such as the bitcoin – are receiving. But this does not mean that they are the most important or even the most promising innovation. Indeed, in my view, their current use poses more risks than benefits: they have a low level of acceptance as a means of payment, they are subject to extreme 3/6  volatility, they have numerous operating vulnerabilities and they have been related to fraudulent or illicit activities in many cases. I shall not, however, give an exhaustive list of the risks of crypto assets, since the position of the Banco de España in this connection is well-known. But I will draw attention to how important it is to disassociate cryptoassets or tokens from their underlying distributed ledger technology. Distributed ledger technology offers interesting possibilities insofar as it allows, in short, a ledger book to be shared securely among various agents. Although this technology is not yet sufficiently mature, it has the potential to generate efficiency gains and cost cuts in activities that require continuous reconciliations among various agents, either because such activities are relatively non-standardised, involve a high number of intermediaries or require complex processes. Areas such as securities trading and post-trading, international settlements, collateral management, trade finance and the management of digital identities might benefit from the use of this technology once it ultimately matures.

By way of conclusion, let me stress that, if duly harnessed and managed, the new technologies and the growing digitalisation of the financial sector may offer major opportunities for increasing efficiency and improving financial services as a whole. They may also be useful in adapting services to the changes taking place in user demand. 5/6  As regulators and supervisors, we believe we must be an active part of this process, performing the role assigned to us by society by analysing the developments taking place in the market and promoting, within our remit, healthy, orderly and positive innovation in the financial sector. 6/6
Generally, systems are working better and the economy is getting bigger and bigger and more and more sophisticated; doing exemptions on a project basis, except in very rare cases, will soon hold us back. The new government should take that last hurdle and make the general system acceptable, even if minimally by lowering taxes and making improvement in civil service performance, probably by making the civil service remunerated by output and productivity rather than the tenure system as at present. That leads to my comment on the long term initiatives that the government might carry out that would help in the long run, which I think is the main strategy for real recovery to take place. Without good long run prospects, there isn’t much hope to do well in the present. The government will have to be moved more on to the private sector footing. This doesn’t mean just selling state enterprises and such things. But it does mean that the government units that are retained would have to work for incentives in terms of output and cost reduction and have to, in general, compete with the private sector for government budget. BIS Review 108/2000  4  Generally, the private sector is not necessarily more efficient than the government. The key is that those that are not don’t survive and better ones expand. This doesn’t happen in the government because those that are inefficient just ask for some more budget, and this is forcibly collected.

In the spirit of the MoU agreement, a primary step in our cooperation is to establish high level policy dialogue with the Bundesbank on a regular basis, the first of which will be held in 2014. This is timely, considering that not only will Turkey assume the G20 presidency in 2015 and engage in an even closer interaction with the central banks of the G20 member states, but will also help meet the recently increased need for policy dialogues over the implementation and implications of new unconventional monetary policies. In general, the CBRT places great emphasis on bilateral relations with fellow central banks, especially those of the G20 member countries. The year 2012 is a testament to our commitment, as the CBRT opened six new representative offices, which brought the total number to ten. The first-round representative offices include those in Frankfurt, NY City, London and Tokyo. The ones opened later on are in Moscow and Sydney – to strengthen relations with other G20 presidency countries; Beijing and Kuala Lumpur – to strengthen relations with the Asian countries; Paris – to strengthen relations with the OECD, and finally Washington, DC – to strengthen relations with the IMF. In her efforts to enhance regional cooperation, the CBRT laid the foundations of the dialogue among central banks that paved the way for the establishment of the Central Banks Governors’ Club of Central Asia, the Black Sea Region and the Balkan Countries.
Our regulations, which restrain the banking business operational, liquidity or market risks, are in full compliance with the international standards, providing at the same time enough room for the development of the interbank market. We have also taken major steps in terms of the institutional development of this market, through the establishment and maintenance of TRIBOR and TRIBID reference rates, through constant communication with the dealers’ association and promotion of new interbank market instruments. I would like to inform you today of the last Bank of Albania’s step in this regard, and also ask for your greater attention in terms of taking prompt actions that will boost the activity and role of the interbank market. Change of the Bank of Albania’s operational target framework The Bank of Albania is in the final phase of reviewing its operational targets. The latter will soon change their form, shifting from the quantitative targeting of the Bank of Albania’s balance sheet to the targeting of interbank market interest rates. The operational targets of monetary policy play a key role in the formulation and conduct of monetary policy. In a theoretical background, these targets serve as a link between the monetary authority’s interventions in the interbank market and the intermediate target of monetary policy. Thus, the operational targets serve as the starting point of the monetary policy transmission mechanism. In practice, these targets serve to steer and discipline the monetary authority’s interventions in the money market quantitatively.

Broadly speaking, this operational philosophy is guided by the need to steer the short-term interest rates in the interbank market close to the key interest rate set by the monetary authority. As such, it serves better to keeping the short-term horizon of the interest rates’ curve under check, making the conduct of monetary policy more transparent and providing clearer signals for the economic activity. Steering our operations to the stability of interbank market interest rates will serve to a more relaxed functioning of the interbank market and lowering of risk premiums. In addition, this operational target is well-framed in our mediumterm steering and commitment to adopting the inflation targeting regime, making up an important link of its successful adoption. Concluding my theoretical discussion of this change, I would like to underline that our longterm commitment to keeping our foreign reserve at optimal levels to cope with the shocks Albania may be faced with remains an unquestionable objective of our monetary policy. In an institutional aspect, I would like to note that such a move does not only attest to the level of maturity of our interbank market. It also crowns our constant efforts in achieving its utmost efficient management. In this context, the Bank of Albania has made utmost efforts to develop liquidity forecast models, to dampen the impact of fiscal flows into the money markets and to develop optimal procedures and modalities of interbank market interventions.
Today we will summarise our intermediate results and progress we have made so far. From the beginning of 2016 to March of this year, outstanding foreign currency loans went down by almost $ billion. This was partly offset by an increase in outstanding ruble loans, which grew to 514 billion rubles. We can also see a decrease in foreign currency lending, mainly in those industries where companies lack so-called natural hedging. Once again this refers to businesses in the construction and real estate industries, as well as wholesale and retail trade. For exporter companies the situation remains unchanged, and banks continue to make foreign currency loans to them. In 2014–2015, exporters’ external debt presented a significant potential risk to financial stability. The high number of maturing loans was a cause for concern, and we were carefully monitoring the schedule for upcoming repayments. This spike in external debt repayments has since passed. In the first quarter of 2017, the 27 largest companies repaid a combined total of $ 3/6  BIS central bankers' speeches  billion in external debt. They will repay a further $ billion by the end of 2017 (April – December), which is 22% less than the payments made in the same period of the previous year $ billion). Now, given the recovery in economic activity in the world and in Russia, as well as the increase in attractiveness of Russian borrowers, there is the potential risk that these borrowers will accumulate excess foreign currency debt.

However, from the point of view of financial stability we cannot completely disregard the possibility of capital outflow from the OFZ market if external or internal shocks were to take place. The Bank of Russia conducted a survey of foreign investors regarding their investment strategy in Russian sovereign bonds. The results of the survey show that a significant portion of investors buying OFZ admit that these may be sold prior to maturity. Such risks need to be taken into account and their impact on the economy reduced through clear and predictable policy. This is important because the situation on global markets remains fragile and volatile while uncertainty persists in a number of factors. Such factors include what format a British exit from the European Union will take, at this point still unclear; the possible negative consequences that will result from changing economic and trade policies in the United States; and the aggravation of political risks in Europe. The heightened risk of negative developments in the Chinese economy, given the high degree of debt load in the economy and increase in the number of corporate defaults over the last year, may also prove to be an important factor. However, seeing as total capital inflow is considered to be small, risks to financial stability associated with the possible outflow of this capital remain quite low. The excessive optimism currently experienced in global financial markets may also be a cause for concern.
June and the first half of July showed the first signs of weakening inflationary pressure, this is still not enough to speak of a steady decline in the inflation rate. In July, households’ inflation expectations continued to rise. In these conditions, even one-off factors might have a longerlasting impact due to their secondary effects. To prevent this, it is essential to create conditions that would encourage the propensity to save. For this, we need higher interest rates. We should not tolerate high inflation expectations in order to prevent their anchoring at this high level and avoid a more significant increase in the key rate that would be needed further on in this case. The second topic is the economy. According to our estimates, economic growth sped 1/3  BIS central bankers' speeches  up considerably in the second quarter. High-frequency indicators show that Russia’s economy has bounced back to its pre-crisis levels. Output in two-thirds of the major industrial sectors already exceeds pre-crisis levels, and this upward trend continues. Oil production has not restored yet. Output has also not recovered in international air transportation and hotel and restaurant business. However, this was due to remaining anti-pandemic restrictions, rather than insufficient demand. Moreover, the pandemic drastically affected the structure of demand and supply. In my previous statement, I mentioned the changes caused by the transfer of a significant portion of employees to work from home, as well as the elevated level of inventories now formed by companies.

Mr. Chairman, having said that, we will now discuss some case studies that would throw some light about the degree of harmonization that took place between the policies of the Central Bank and the Ministry of Finance, in order to deliver some of the vital results to our country and economy, over the past 7 years. Case Study 1: Opening out Sri Lanka Treasury Bills and Bonds to foreign investors Mr. Chairman, the first case study that I would like to cite is the November 2006 move to open out Sri Lanka Treasury bills and bonds to foreign investors. By late 2006, in Sri Lanka, a massive infrastructure development programme had been launched, and the critical humanitarian operation had begun. These twin programmes had demanded a regular, steady and massive flow of funds, and it was becoming increasingly clear that we would not be able to secure the new fund requirements only via local taxes and local borrowing. If such a quantum of funds were to be sourced from within, an enormous pressure would have been exerted upon the entire economy. In fact, such an attempt would have pushed interest rates to unacceptable levels, and may have even dragged the economy towards negative territory, and placed the entire monetary system at considerable risk. Such fears may have perhaps been one of the reasons that prompted successive governments of the past, to avoid large scale infrastructure development programmes or attempt to launch a full scale counter action programme against terrorism.
Mr. George looks at the prospects for the UK economy and developments towards European Monetary Union Speech by the Governor of the Bank of England, Mr. E.A.J. George, at the Liverpool and District Bankers’ Institute Bi-Annual Dinner in Liverpool on 12/3/97. It is a very enjoyable - and vital - part of our job at the Bank of England to keep in touch with what is going on around the country. And we work quite hard at it - through visits like this one; through our non-executive directors who have business interests in the regions and through our network of regional agents. Now the purpose of these contacts is to help us understand the reality behind our precious monetary and economic statistics, and to help us understand what is pre-occupying you. The economic reality I would say is not at all bad. Looking back over the longer term, I detect an important change in attitudes in this country: where before people - both employers and employees - tended to look inwards and backwards, seeking to protect what they had had, now, it seems to me, they are increasingly looking outwards and forwards to new opportunities. It is a fundamental change. And over the past four years or so it has been complemented by a more stable macro-economic environment than most of us can remember in our professional life time. Putting these together has brought us consistently low inflation; steady and sustained growth; and gradually falling unemployment.

On a national level, there is still the need for deep structural reforms and all efforts should be made for them to operate in a concerted way across the SEE region. I believe that the European Union structures should closely orientate, monitor and assess this process. This is the only way to steadily convert our countries into highly productive economies, attractive to foreign investors against the backdrop of favourable labour cost. This all makes sense once we fully re-dimension our educational capacities, particularly in technology and other areas where we could discover and explore advantages compared to other economies. Instead of looking at each other merely as competitors, we should approach the regional cooperation as a non-zero-sum game, where each country has to gain in partnership. Summarizing, this process calls for risk adverse macro and development policies; well coordinated policy mix; stronger cross border co-operation, and concerted efforts – perhaps harmonized and motivated across the region – to deepen the quality of structural reforms. Structural reforms targeted to improving the business environment will help foster new capital inflows and strong and sustainable growth. In this respect (and in the light of the last crisis lessons), countries can make better use of the EU fiscal surveillance process as explicit policy commitment devices. Candidate and potential candidate countries on one side and the EC on the other have the opportunity to transform this surveillance process (possibly enhancing it with an analytical input form IMF) into an efficient foreign anchor. BIS Review 164/2009  3