samchain/econo-pairs-v1 huggingface dataset:
As a major interface between Europe and the rest of the world I have little doubt that euro-activity in London will mean more rather than less euro activity in other European financial centres like Frankfurt, Paris, Milan, Amsterdam or Copenhagen. And I have little doubt either that what is good for those centres will be good too for the City. Thirdly, and perhaps most fundamentally, the United Kingdom, even while it does not participate in the euro, can contribute to its success by continuing to pursue macro-economic, both fiscal and monetary, discipline in parallel with the euro-area countries. The Government is committed to this course as a matter of national economic self-interest - one of its very first acts in Government for example was to hand operational independence for the conduct of monetary policy to the Bank of England. But these same policies are calculated, too, to make us a more prosperous and active trading partner for Europe as a whole, and to ensure that we do not have any avoidable disruptive effect on the policies or on the economy of the euro participants. More than this they are calculated to foster sustainable economic convergence as the necessary precursor to our eventual adherence to the euro club. And in the meantime the British Government will continue to pursue, and to advocate in the councils of Europe the supply-side flexibility that will be vital to its success.

But the potential benefits will derive importantly, too, from the greater transparency and liquidity of unified financial markets in the euro-denominated instruments rather than the fragmented markets denominated in the various national currencies that we have now. Providing transparent and liquid, competitive, innovative and well-regulated financial markets is one of the things which the City does particularly well. There will be a vigorous Euro-euro market in London, just as there are vigorous markets in Euro-DM, Euro-francs, Eurodollars and so on now. If not our dowry exactly, since we will not participate in the first wave, it will be our wedding present. The wholesale financial markets in the UK derive their strength from London’s position as a uniquely international, rather than simply a national or regional European, financial centre. This reflects the critical mass of markets and financial services in commercial and investment banking available in London including the strongest financial businesses from all around the world, and including leading Danish institutions. For instance, there are more banks operating in the City which are incorporated abroad than there are domestic banks, and more than half the total deposit base (over £ trillion) of the UK banking system is denominated in foreign currencies. And, the fact that so many foreign-owned institutions - including very many from our European partner countries - continue to build their presence in London, suggests that they share this perception. The City in this capacity is, I know, seen as something of a mixed blessing by some people on the Continent.
Lars Heikensten: The Riksbank and the euro Speech by Mr Lars Heikensten, Governor of the Sveriges Riksbank, at the Society of International Treasurers Convention, Stockholm, 17 June 2003. *  *  *  Let me begin by thanking you for the invitation to come here and speak on the subject of EMU. Approximately three months remain until 14 September when the Swedish people will vote on whether to participate in monetary union. In the event of a “yes” vote, Sweden will enter monetary union in 2006 and introduce the euro as its currency. The right of determination over our interest rate level will then be transferred to the European Central Bank (the ECB). On the other hand, a “no” vote would generally imply “business as usual” for the Riksbank. Today, I will be speaking about some of the implications for the Riksbank and our operations in the event of a “yes” vote in the referendum. I will begin by speaking about the preparatory phase, that is, from 14 September until 1 January 2006, during which time preparations will be conducted in the Swedish economy for a changeover to the euro, and the krona will join the exchange rate mechanism, ERM2. Subsequently, I will talk on the issue of monetary policy as it will be conducted by the ECB and point to differences as well as similarities with how it is conducted today. Thereafter, I will touch upon the effects of a changeover on our work with financial stability.

Hyden and Court in their 2002 Discussion Paper, Governance and Development, relate the  BIS Review 109/2007  1  emergence of this dimension of governance to the changing paradigms in thinking on development. They trace the evolution of development thinking from the emphasis on projects to programmes, then to policies, and the latest recognition that in addition to these, politics is also important. The inclusion of the political dimension in development practice has altered the development landscape, prompting intrusion into aspects of policy earlier deemed beyond the limits of donor activity; with concomitant protests of violation of sovereignty and related controversies. The concept of governance arising from this process is not precise in meaning. Despite attempts at distinguishing between the political, economic and administrative aspects of governance, its analytic and operational dimensions, and its constitutive and distributive elements, in the final analysis governance is essentially all-embracing in its essence. It percolates through the entire fabric of the political, economic and social life of a nation. Recognition of this is reflected in the diversity of definitions given to the concept. While it may be too time-consuming to provide a sampling of these definitions, the flavour of the concept can be savoured from the following statement of Vivien Collingwood of Nuffield College, Oxford in the paper, Good Governance and the World Bank.
The aim of the setting-up of a one-stop consumer education centre is to address information gaps that may exist. The programme also aims to broaden the consumers' horizon by enhancing their knowledge on the new and more innovative ways of conducting banking. Internet banking, for example, is a fast and convenient mode of conducting banking transactions that has yet to gain widespread acceptance amongst banking consumers. With greater access to information on this, consumers can be better informed on the advantages of this form of banking. Any fears or apprehension on this mode of banking may be removed thus allowing for greater convenience derived from banking via desktops in the comfort of the home or office. BIS Review 4/2003  1  Increased access by the public to information will also increase the level of awareness not only of the rights of consumers but also on the responsibilities of both the consumers and financial institutions with regard to the financial products and services being offered. Consumers should be aware of their rights and how best to seek redress if there is dissatisfaction with the products or services purchased. Through active consumerism, banking products and services will need to keep up with the expectations of consumers and this will inherently contribute towards improved banking products and services.

As outlined in the Financial Sector Master Plan, the strategies to achieve an adequate and effective consumer protection infrastructure involves: •  A comprehensive and structured consumer education programme;  •  Increased transparency by the financial institutions on the products and services being offered;  •  Legal redress for consumers to deal with grievances arising from the purchase of financial products and services;  •  Expansion in the role of the Banking Mediation Bureau to cover the full range of retail banking related consumer complaints and educating banking consumers of the ways in dealing with the available courses of action;  •  The implementation of Anti-Trust regulation to define the process by which abuses that are detrimental to consumers can be addressed; and finally  •  Establishing a deposit insurance fund to not only create incentives for prudent management by the banking institutions but also to assure protection to small depositors. The objective is to promote a more market oriented consumer protection framework. Ladies and Gentlemen, This new millennium brings with it new opportunities and challenges to both the financial institutions and to the consumers. As we advance forward we can expect an increasing array of choices open to consumers. In making financial decisions, consumers require information on a wide range of matters and details about the processes and documentation involved, the relevant fees and charges to be incurred and the risks and benefits of each type of product or service.
Centralising decision-making would bypass many of the current obstacles to effective resolution such as the need for cooperation and coordination between multiple authorities. This would in turn lead to quicker decisions and reduce resolution costs, as early action would help to maintain the economic value of the bank in question. Second, an ERA would be more effective in minimising the cost for taxpayers of bank failures. A bank may be “too expensive”, “too complex”, or even “too well-connected” to resolve at the national level, making bail-out the preferred strategy. An ERA, on the other hand, would have the financial, legal and administrative capability as well as the necessary independence to carry out effective resolution. By imposing burden-sharing on shareholders and creditors and by financing residual costs through a European Resolution Fund financed ex ante by all the banks, the ERA could ensure that the private sector bears the primary burden of bank resolution costs. European resolution, similar to what the FDIC does in the US, is not about bail-out of banks by state recapitalisation efforts, but the use of wide bail-in powers to resolve banks with little use of tax-payers money. Third, an ERA is a necessary complement to the single supervisory mechanism. A system where supervision is European but resolution is national creates frictions. The single supervisor may assess that a bank needs to be resolved, but the relevant Member State may be unable to bear the resolution costs or unwilling to resolve a favoured national firm.

The changing distribution of risks for individual firms  Moving on to my second example, even in the absence of systemic spill-overs from flash episodes, fast markets alter the pattern of risks that individual market participants are exposed to. And there good grounds for concluding that more needs to be done to ensure market participants take account of this consistently. 14  See BIS (2017), ‘The sterling ‘flash event’ of 7 October 2016’, January. See Joint Staff Report (2015), ‘The US Treasury Market on October 15, 2014’. 16 In this spirit, the FPC concluded following the sterling flash event that “such disruptions underscore the concern that liquidity in some markets may have become more fragile in recent years”. See Record of the Financial Policy Committee Meetings held on 23 and 29 November 2016. 15  6  All speeches are available online at www.bankofengland.co.uk/speeches  6  Use of algorithms does not change the fundamental risks associated with trading in financial markets (e.g. market, counterparty and operational risks). But use of high-frequency trading algorithms does change their relative intensity and can materially increase the potential to build up significant intraday positions. This latter point is most obviously true for those bank and non-bank intermediaries that specialise in highfrequency trading. And though these firms should be expert in managing such risks, history shows this is not a given.
I do not underestimate any of the difficulties involved: we must first manage today's threats. We must involve and convince the citizens, who too often fear that more economic integration threatens their European social model, when conversely it would strengthen it: we should state much more clearly our commitment to these common "fundamentals". Finally, we must have the courage to assert our values openly. But I will conclude with a former student of Sciences-Po, and one of the greatest, Simone Veil: “Setting itself high ambitions, Europe will be able to make its  Page 10 of 10  voice heard and defend strong values: peace, the defence of human rights, and more solidarity between rich and poor.” xxvi This fight is worth fighting; it is mine, and I believe above all that it is the fight of your generation. I wish each and every one of you, good luck. References: i Communication on the future path of policy rates. ii Stefan Zweig, Erasmus, Grandeur and Decadence of an Idea. iii IMF (2019), World Economic Outlook, updated on 23 July. iv IMF (2019, 2018), World Economic Outlook, July 2018 and July 2019. v Nominal ICT capital as a percentage of nominal GDP, entire economy. Source: Gilbert Cette and Ombeline Jullien de Pommerol, “Have the growth gains from ICT been exhausted? Banque de France blog, 18 October 2018; updated figures. vi Conclusions of the meeting in Chantilly on 17 and 18 July 2019 vii Marie-Laure Djelic (2002) “Exporting the American Model: Historical Roots of Globalization”.

The second is that we want competition and innovation in financial services – it can increase efficiency, functionality and resilience. Setting out the regulatory approach allows those who want to innovate by providing better products and services to understand the risks that need to be managed as they develop those products. It also ensures that innovation is not simply competing by taking higher risks. This approach has been a key element in the evolution and adoption of innovation in payments in the UK in recent years. Against the background of increasing digitalisation of everyday life, the combination of technological advance and appropriate regulatory frameworks[1] - both to foster competition and to manage risks – has transformed the way we pay. It has also stimulated the growth of the UK Fintech sector which is now the second largest in the world[2]. Contactless’ card payments are now used by close to 90% of people and make up almost a third of all payments in the UK, Nearly a third of UK adults use mobile payment apps such as ApplePay or GooglePay. Seven million consumers and three-quarters of a million SMEs are using Open Banking products. Several digital only challenger banks operate in the UK providing competition and innovation to the UK banking sector. These changes have not only transformed the way people pay but also the type of money they pay with. Two types of money circulate in the UK today.
Investment horizons are usually so long that it would take many years to gather sufficient data for a statistically reliable test. Credit risk models have clearly improved banks' understanding of the risks they face, and are slowly being implemented into their own internal systems. But the main challenge here in the next few years will be to refine the operation of these models, and seek answers to some of the questions I have raised. This is a fascinating research agenda, and I have no doubt that academics will treat these questions as challenges rather than causes for despair! Ensuring adequate safeguards for the system as a whole That leads me to my final topic tonight - how, given our imperfect knowledge, we design a regulatory capital regime which adequately captures the full range of risks run by financial firms. There are, first, a number of important points which remain unresolved in the discussions on the new Basel Accord. One issue relates to the appropriate overall level of capital in the banking system. Overall capital, as with many regulatory issues, is at root a public policy choice about the balance between safety and economic efficiency. Higher capital requirements increase the costs of financial intermediation. Against this, the total pool of capital coming out of the new Accord must be large enough to protect the system against reasonable levels of risk. Second, we need to be sure that the new rules do not give rise to movements in bank capital which excessively reinforce cycles in the real economy.

That success was due in no small measure to the Accord's simplicity. But over time it did become clear that the lack of very precise differentiation between different kinds of borrower was introducing serious distortions by opening up gaps between the capital required for regulatory purposes and the 'economic' capital suggested by banks' own increasingly sophisticated risk management systems. Another weakness in the 1988 Accord was the lack of any proper treatment of market risk - that is, risk associated with fluctuations in interest rates, exchange rates and so on. The intensive application of information technology and advances in the theory of finance drove significant improvements in the ability of larger banks to measure and manage market risk during the 1990s. Of particular importance was the development of 'Value at Risk' (VaR) models, which allowed banks to calculate measures of the aggregate risks being run on entire portfolios. Using the latest thinking on how to price individual assets, and exploiting data on past movements and correlations in asset values, these models provide  2  BIS Review 83/2001  estimates of the statistical distribution of value for an entire portfolio of marketable assets. Estimates of the amount of capital at risk can then be read off from the lower tails of these distributions. VaR models have proved enormously useful to firms in managing the day-to-day risk on parts of their business. And the Basel Accord was modified in 1996 to allow VaRs to be used as an input to the regulatory capital calculation for market risk.
A taxonomy that includes both green and transition activities can support a progressive shift to greater sustainability. In Singapore, the green finance industry task force I mentioned earlier is developing such a taxonomy to guide our financial institutions. It sets out a “traffic light” system to classify sustainable activities as green, transition activities as yellow, and highly carbon intensive activities as red. MAS has been working with the industry to promote green finance solutions. MAS has introduced grant schemes to defray the costs of issuing sustainable bonds and green and sustainability-linked loans that are in line with international standards. Funds raised through such bonds and loans will support investments in green projects. We are supporting initiatives to foster efficient markets to trade carbon credits. Carbon credits help to channel funds from firms with hard-to-abate emissions to projects that reduce or remove emissions. Voluntary carbon credits will be an important complement to decarbonisation efforts, especially in Asia where transition issues need to be tackled. MAS is supporting industry efforts to build the infrastructure for a liquid and transparent voluntary carbon credit market in Asia. DBS Bank, SGX, Temasek, and Standard Chartered have announced plans to launch 4/9  BIS central bankers' speeches  Climate Impact X, an international marketplace for high-quality carbon offsets generated from nature-based solutions in Southeast Asia. MAS is promoting Green FinTech – harnessing technology to enable trusted and efficient sustainable finance flows. The lack of access to trusted high-quality data on a project’s carbon emissions is probably the biggest impediment to green finance.

But an environment in which borrowing is free and the real interest rate is considerably lower than trend growth in the economy is unlikely to be sustainable over time. Chart: Estimates of the neutral interest rate The neutral interest rate cannot be observed and must be estimated. In the Bank’s Monetary Policy Report, the current neutral real interest rate in Norway is assumed to be around zero. The estimate is based on calculations from a range of different models. As we can see in the chart, these calculations show that the neutral interest rate has fallen to a historically low level close to zero over the past 20 years. With an inflation target of 2 percent, this means that setting the policy rate at zero would enable us to bring the real interest rate down to 2 percentage points below its equilibrium level.1 2 In Norges Bank’s assessment, monetary policy has sufficient room for manoeuvre with an inflation target of 2 percent. First, international experience has shown that the room for manoeuvre in monetary policy is not exhausted when the policy rate is close to zero. I will come back to this. Second, our calculations show that over the past 20 years, the real interest rate has normally remained less than 2 percentage points away from its estimated equilibrium level.3 This may suggest that a real interest rate that is 2 percentage points below equilibrium has in most cases provided sufficient economic stimulus.
We again look at a cost shock. In the model exercises I showed earlier, expectations formation remained unchanged even when inflation surged. Both firms and households have assumed that inflation will move down relatively quickly. The effects in the standard model are represented by the dark blue lines. [14] In the scenario shown by the light blue lines, we introduce the possibility of a more persistent change in inflation expectations when inflation becomes high. [15] Here households and firms pay more attention to the inflation numbers and assume that inflation will remain persistently high. The cost shock propagates, and inflation continues to move up. A stronger and prolonged period of monetary policy tightening is then required to bring down inflation. The real economic costs associated with high inflation increase. Chart: Concluding slide  Conclusion Let me conclude. Norges Bank is charged with ensuring low and stable inflation. Inflation has surged to a high level over a short period. Our task is to bring it down again. Wage-price spirals have not been a theme in Norway or among our closest trading partners for a long time. One of the lessons learned from the Great Inflation of the 1970s and 1980s is the importance of firmly anchored inflation expectations. Many countries experienced a period of high unemployment before inflation was brought under control, and inflation expectations fell. [16] We do not believe that there is an imminent danger of a wage-price spiral in Norway.

The model exercises I have presented so far build on the assumption that inflation expectations are anchored. As long as households and firms assume that inflation will return to target over time, neither small nor large cost shocks will have a lasting effect on inflation. The central bank can then put relatively large weight on the aim of high and stable output and employment. Chart: Greater attention to inflation? In Norway inflation has been low and stable for a long period, until recently. Inflation expectations, as we measure them, have been close to the inflation target. Short-term fluctuations in inflation have had little impact on inflation expectations ahead. Since winter, inflation expectations have increased, particularly one-year-ahead expectations. Inflation has also attracted substantial media attention. In 2003, a theory called rational inattention was advanced by the Nobel Laureate Christopher A. Sims. [13] In periods of low and stable inflation, it may be rational not to pay much attention to inflation and it would be reasonable to assume that inflation remains relatively constant. Once inflation reaches a high level, agents start paying attention to it and find it worthwhile to spend time and resources on factoring future inflation into their economic decisions. If economic agents expect high inflation to persist, the high inflation numbers may become a source of persistently high inflation. Both inflation and inflation expectations become entrenched at a higher level, and it becomes more difficult to bring inflation down. Chart: From one expectations regime to another This can also be illustrated in a model exercise.