samchain/econo-pairs-v1 huggingface dataset:
Ultimately we needinternationally harmonised disclosure frameworks – at least a basic common ground on which jurisdictions can further elaborate. To this end, interoperability of standards will be key, and the coordination between the EFRAG and the IFRS Foundation, should be the cornerstone of a successful globalisation of non-financial reporting standards. On financial opportunities (let me turn now to the lower part of the axis), the market momentum 1/4  BIS central bankers' speeches  has been impressive this year again. More than half a trillion USD of green bonds will be issued this year, which is an all-time high, with record debut for the EUR 12 bn NextGeneration EU green bond. Inflows into sustainable funds represented more than USD 262bn in the first half of this year, close to half of the overall inflows (USD 545bn) over the same period. On the horizontal axis, which brings together our missions as a Central bank, we collectively achieved a major breakthrough last July with the conclusion of the ECB monetary policy strategy 2 The review under Christine Lagarde’s leadership. The Banque de France contributed decisively. ECB is pioneer in having decided an ambitious action plan by 2024, including the three following steps: (1) make economic projections, and therefore model.

Sharp declines in asset prices and households’ expectations led to a swift rise in precautionary savings. Conditions worsened rapidly in labor market and job losses have reached levels never seen since the Great Depression. Unprecedented policy reactions to crisis taken by government and central banks worldwide have managed in stabilizing the financial conditions of banks and reduced funding pressures. BIS Review 121/2009  1  Thanks to the decline in counter-party and liquidity risks and the ease of tension in international markets, emerging market equities have rapidly gained ground, bond spreads have narrowed, and volatility in exchange rates came down. Commodity prices have rebounded from their recent low levels. Capacity utilization ratios and industrial production have globally recovered compared to the first quarter of 2009. However, taking into account the loss of confidence and the size of the damage financial institutions and households have suffered, the fragility in the financial sector and reluctance in consumption and investment is likely to continue in the near future. Despite recent signs of revival in global economy, the pace of economic activities remains weak. Problems prevail in the credit markets. Unemployment rates keep rising. In summary, all indicators point to a recovery, which is slow, gradual and painful. Distinguished Guests, Global problems require global solutions. Quite often, changing an existing system is more difficult and expensive than forming a new one. It is obvious that this ongoing crisis is going to end sooner or later as did previous crisis.
There are relatively few studies using Swedish data of the significance of various regulations for housing prices. In a study of US data, Paciorek (2013) finds that differences in the scope of regulation between different cities explains a large proportion of the differences in fluctuations in housing prices. 16  Another interesting hypothesis on how the conditions for growth may be affected is that rising housing prices can mean that banks’ lending to companies is “crowded out” by increased lending to the housing market. This can lead to a fall in investment. For a study on US data, see Chakraborty, Goldstein and MacKinlay (2013). 17  For some examples, see Dagens Industri (2013), Swedbank (2013) and Lindbeck (2013). 8  BIS central bankers’ speeches  Let me summarise, in conclusion, what have been my most important messages here today. Firstly, I think that the Swedish economy has managed to come through the financial crisis relatively well, in an international perspective. Secondly, I consider that the policy the Riksbank has conducted, which has aimed at reducing the risks linked to household debt and the housing market, is well within the mandate the Riksbank has been given. Thirdly, I think that the fact that macroprudential policy has begun to take shape is a step in the right direction, but not a quick fix that will solve all problems. Finally, and partly on the same theme, I consider that many policy areas must cooperate to rectify the problem of a high and rising debt in the household sector.

It would have been very odd if we had ignored these risks with the justification that it is always more important to try to attain the inflation target in the short term – regardless of the consequences later on. For someone who believes that the risks linked to household debt are a threat to the stability of the Swedish economy, it is a little like feeling forced to step on the accelerator despite hearing that the engine is about to seize. It is not just a question of “bubbles” One thing I consider important to point out is that this policy does not necessarily involve what are often called “bubbles”, although the situation may of course be particularly serious if households have unrealistic expectations of interest rates.6 Quite regardless of whether or not an upturn in housing prices has natural economic or, as one often says, fundamental explanations, it is problematic if indebtedness is increasing at a faster rate than income over a very long period of time, and there are few signs that the trend will be broken. Households will then become gradually more vulnerable and liquidity margins will become smaller. Finally, one will reach a point where even fairly small shocks to income, asset prices or interest rates can trigger adjustments that have fairly substantial effects on the  4  See, for instance, Mian and Sufi (2011), Dynan (2012) and Jauch and Watzka (2013).
03.10.2016  Second Financial Education Day Banco de España/CNMV Luis M. Linde Governor  Good morning I would like to begin by saying how pleased I am to be participating in this celebration of the Financial Education Day. The purpose of this event is to raise society’s awareness of the importance of improving and broadening financial and, more generally, economic knowledge, helping people take decisions that affect many aspects of our lives. At times like the present, characterised by the constant evolution and development of saving and borrowing instruments, the ability to correctly assess the risk and profitability of different financial products is particularly important. Indeed, different products may be more or less appropriate depending on an individual’s risk exposure profile, age and income. The role of experience when choosing products is limited, since we are frequently faced with new products or products with features that are not well known. I would like to stress that the main purpose of financial education is not to train experts in how to understand complex products, but to help ordinary people with their spending, saving and investment decisions. Particular prominence is given in financial education to aspects such as preparing a household budget, prudence when taking decisions, the assumption that higher returns are generally associated with higher risks, and, no less importantly, the time profile of economic decisions, and, specifically, preparation for retirement, which is obviously very important given current demographic trends and the challenges of population ageing.

This study, which we expect to be completed by the end of 2017, will include various original aspects to address the special characteristics of the Spanish case. First, educational skills are decentralised. Given the nature of financial competence, which varies significantly according to the level of education of the individual concerned, the project will use representative samples of the different levels in the various regions. Second, the financial knowledge of each individual may not reflect that of the persons who actually take household decisions. For example, in Spain, important financial decisions regarding house purchase and mortgage borrowing are taken at different ages than they are in other European countries, as a high proportion of young people live with their parents. As a result, information is sometimes needed on the financial competence of those members of the household who take saving and borrowing decisions affecting the whole household. 4/5  Apart from its financial knowledge, we have little evidence regarding the general economic knowledge of the Spanish population. Given this situation, questions have been included in the financial competence survey that aim to measure, inter-alia, knowledge of certain key concepts, such as inflation and money. In 2018 we will have the results of the survey, which will enable us to analyse on a sound basis the financial knowledge of the adult population in Spain and to identify those areas on which the Financial Education Plan needs to focus. Future activities will be based on this information.
Administering a systemically important benchmark is a new departure for the Bank – but it is a role we accept given our statutory ability to collect the underlying data. We will administer SONIA as a utility, for the benefit of the market, on a cost-recovery basis. I know François will say more about how the Sterling Working Group made its decision. For my part, I would like to take this opportunity to thank François, members of the Working Group, and their institutions, for their commitment and hard work in getting to this point. However the task is not yet finished. Attention now turns to the adoption of SONIA as an alternative to sterling Libor. The Working Group has an important ongoing coordination role to play. The main focus so far has been on the derivatives markets. Indeed we invited dealers to form the Working Group in the first place because our experience of derivatives reform suggests they can be most influential in catalysing a transition. But it is stating the obvious to say that demand for derivatives stems partly from the desire to hedge underlying cash market instruments. That reinforces the need, ultimately, for a broadly-based transition. 5  All speeches are available online at www.bankofengland.co.uk/speeches  5  That can be to the benefit of any user of Libor who bears exposure to bank credit risk not through preference but through lack of established alternatives. I personally suspect that many users would be in this category.

The economic purposes of these contracts include hedging or gaining exposure to: outright interest rate risk, basis risk, cross currency risk, and interest rate volatility. Banks, pension funds, insurers and hedge funds are all heavy users of Libor derivatives. Libor is also important for the real economy in the UK, with more than £ of SME and corporate loans, around £ of Floating Rate Notes and £ of structured debt referenced to sterling Libor. Libor’s role here is typically to provide a transparent and widely accepted reference point for the floating interest payments on loans. The dominance of Libor might be taken as evidence of the overwhelming need for Libor-linked financial contracts. However I do not believe this is the case. A large part of the reason Libor is so widely used is due to what economists call network effects. Using Libor is attractive because Libor instruments are liquid. This is self-reinforcing – liquidity drives use of Libor, which drives liquidity. In many cases the use of other benchmarks would be preferable for users. For example, most users of interest rate swaps are seeking to hedge the general level of interest rates, not bank credit risk. For this, near risk-free rates would be more appropriate. However, liquidity for long-dated sterling swaps is firmly rooted in contracts referencing six-month sterling Libor, and individual participants cannot change this.
Overall, tax revenues, before the transfer to local and regional government, are projected to increase by 7.8% in 2017, while social contributions are projected to increase by 6.3%, which, given the macroeconomic forecasts and the impact of the tax reforms mentioned above, would entail a greater response by revenues to growth in activity than in the past, especially in the case of social contributions, which are projected to grow by more than their bases (employment and wages), even taking into account the effect on revenues of the legal changes mentioned above. If the uncertainties surrounding the estimates of the impact of the legislative changes on taxation are also taken into account, it is clear that revenue growth needs to be monitored constantly over the course of the year, so that a timely adjustment can be made to spending or revenue in the event that the risks to the deficit target materialise. Moreover, in such a decentralised country as Spain, where more than 40% of public spending is made at the local and regional level, the State and Social Security budgets give merely a partial view of the budgetary policy of the public sector as a whole for next year. From this perspective, the Updated Stability Programme to be published in the next few days is particularly important, since it consolidates the budgets of central government agencies with those of regional government and local government.

That is because the rise of international free trade – and the stability that comes with it – has historically depended on the backing of a global hegemon. This was evident during the British Empire in the 19th century, as it was with American support in the wake of the Cold War. [3] However, major economies – led by the United States and China – are now increasingly using trade to limit the ambitions of geopolitical rivals. That could fragment world trade with potentially huge costs. The IMF estimates that severe trade fragmentation may cost global output roughly 7% in the long term – an amount similar to the annual output of Japan and Germany combined. [4] These geopolitical winds are reshaping the second feature of this new map: supply. We are seeing strategic considerations becoming increasingly important in where suppliers are located. The US Inflation Reduction Act, for example, is deliberately aimed at “reshoring” production and reducing the country’s reliance on strategic imports like batteries. [5] China is also seeking to reduce its own dependence on the rest of the world. And some surveys suggest that even firms in “non-strategic” sectors are increasingly likely to regionalise their supply chains. [6] This in turn is leading to the third key feature: the growing importance of security. With the security of supply for critical inputs no longer guaranteed, we are likely to see a new “scramble for resources”.
Monetary policy results in emerging economies and in Chile  Convergence of inflation to developed-country levels There are several empirical studies exploring how emerging economies in general, and Chile in particular, have benefited from implementation of an IT regime. The evidence shows that IT has been very helpful in bringing inflation down to low single-digit levels in emerging economies. It has been shown that the adoption of IT has played a leading role in emerging economies’ successful convergence to inflation levels observed in developed economies (Mishkin and Schmidt-Hebbel, 2007). Small deviations of inflation from target in Chile It has been shown also that IT countries are more successful in attaining their inflation targets than non-IT countries (Mishkin and Schmidt-Hebbel, 2007). The introduction of IT has also helped Chile to attain levels of inflation closer to target levels. Albagli and Schmidt-Hebbel (2004) provide an international comparison of inflation performance and deviations from targets for 21 IT countries. They consider the average relative deviation of inflation from targets since the beginning of IT in each country. The results show that Chile is the second most accurate IT country in hitting its inflation target (figure 7). Since adoption of full-fledged IT by Chile in 2000, average annual inflation has been 2.9%, remaining around 75% of the time within the target range. Only 10% of the time did inflation rate rise above the upper target bound, and 15% of the time inflation fell below the lower bound (figure 8).

Inflation targeting and credibility Adoption of IT has also contributed to the buildup of credibility of monetary policy in IT countries. Several authors show that the IT regime has helped in anchoring inflation expectations at levels close to inflation targets and inflation expectations are more stable than in the U.S. (Ramos et al., 2007; Gürkaynak et al., 2007). In Chile, the distance of inflation expectations from inflation targets was closed as targets converged toward the stationary 3% level and the Central Bank showed strong commitment to attaining targets (Céspedes and Soto, 2005). During the past five years, inflation expectations have remained close to the mid-point of the inflation target range, reflecting high credibility of the IT regime (figure 9). Inflation targets and stability Emerging economies have experienced reductions in the volatility of both inflation and output (figure 10). However, volatility reductions have been more pronounced in IT countries than in non-IT countries. Volatilities of growth and inflation have fallen very significantly in Chile, even in comparison to other IT countries. Two factors explain most of the volatility reduction in IT countries: smaller shocks hitting the economy and improvements in monetary policy efficiency (Mishkin and Schmidt-Hebbel, 2007). Figure 11 depicts the estimated average efficiency frontier of MP for emerging economies before their adoption of IT (orange schedule) and the observed pair of output and inflation volatilities (red point).
Although the authorities must have the final say, the views of industry and the general public will enrich the process and prevent the regulation becoming a theoretical concept, which does not reflect the way business is conducted in practice. Modern supervision Modern regulation must be accompanied by modern forms of supervision. You may remember me saying that the Swedish supervisors during and just after the deregulation did not have adequate knowledge of how to evaluate credit risks in our banks. But they fulfilled their given mandates, which focussed on checking the formalities – that bank operations were adequately recorded and reported; that legal requirements had been duly fulfilled; and that the required documentation was in place. Modern supervision is risk-based. Given today’s size and complexity of banking operations it would be impossible to give equal emphasis to all banks and to all operations and risks; the supervisor has to prioritize. This is done on several levels. Priority is given to supervising large banks and banks which pose high risks to the society, even if they are small. For each individual bank, priority is given to check the material risks, which often are different from one bank to the next. Today, the focus of supervision is much more on the substance and less on the formalities of a bank’s business.

We at the central bank stand ready to analyse the new  8  BIS Review 111/2006  capital requirements’ effects on financial stability, in particular in situations when there is volatility in the macro economy and banks’ credit losses may increase. There is also the issue of implementing the new international accounting standards, IAS. A highly controversial but also interesting development is that the standards promote a higher degree of market-related valuation of many more categories of assets and liabilities in banks and other institutions. Banks are already used to market valuation for highly tradable assets, but the new standards go further and request banks to value also non tradable assets and even liabilities to assumed market prices. In general, and although I recognize the problem of market-valuation of items for which there is no ongoing market, I support the idea of more transparent and market-oriented valuation. I accept that it may lead to more fluctuations in the banks’ balance sheets and also in their profits and losses. Although the financial strength of a bank in the long run will not be affected by using the new accounting principles there is a risk that the analysts and other readers of the financial reports will not understand the difference between the reported temporary results and the underlying issues. They may then panic because of seemingly bad short-term bank results or become excessively optimistic over temporary good results.
And as recently as 1970, that share was just under 10 per cent. But today, in the space of just 40 years, developing Asia’s share of world GDP has nearly tripled to 27 per cent. Projections are that developing Asia will again account for half of world GDP by 2050. Will it happen? 5. There are many things that can potentially stop the Asian juggernaut. International conflicts, domestic upheavals, wrong economic policies, even climate change, have been cited as wild cards that can throw these projections off course. Top of my list is old-fashioned misallocation of resources. Asia’s strength – its high savings and investment rates – can become its weakness. 6. The Asian growth story is essentially an investment story, fuelled by high rates of domestic savings and relative openness to foreign capital. Gross fixed capital formation in emerging Asia during 1980–2000 was about 35 per cent of GDP, compared to 21 per cent in Latin America and 25 per cent in Eastern Europe. High rates of investment and high rates of economic growth created a virtuous cycle of development in emerging Asia during the last 40 years, unmatched in history. 7. But there are growing concerns whether this is too much of a good thing. The investment-to-GDP ratio in developing Asia has gone up further, from 30 per cent in 2000 to 38 per cent last year. The ratio of gross capital inflows to GDP has doubled over the same period, from 8 per cent to 17 per cent.

Notes: For a description of the methodology, see David Aikman, Andrew G Haldane, Marc Hinterschweiger and Sujit Kapadia, ‘Rethinking financial stability’, BoE Staff Working Paper 712 (2018); and Marcus Buckman, Paula Gallego Marquez, Mariana Gimpelewicz, Katie Rismanchi, Sujit Kapadia, ‘The more the merrier? Evidence from the global financial crisis on the value of multiple requirements in bank regulation’, BoE Staff Working Paper (forthcoming). Balance sheet data is from historical regulatory returns (see Sebastian J A de-Ramon, William B Francis and Kristoffer Milonas, ‘An overview of the UK banking sector since the Basel Accord: insights from a new regulatory database’, BoE Staff Working Paper No. 652 (2017)). ‘Large’ means total assets of £ or above. Distress is defined as receiving worst possible supervisory rating between July 2007 and December 2008, or any instance of default, receipt of state aid, or merger with or acquisition by another bank under stressed conditions during the same period. Data on supervisory ratings is from historic FSA records (see Joel Suss and Henry Treitel, ‘Predicting bank distress in the UK with machine learning’, BoE Staff Working Paper No. 831 (2019)). 12 See David Aikman, Andrew G Haldane, Marc Hinterschweiger and Sujit Kapadia, ‘Rethinking financial stability’, BoE Staff Working Paper 712 (2018); and Marcus Buckman, Paula Gallego Marquez, Mariana Gimpelewicz, Katie Rismanchi, Sujit Kapadia, ‘The more the merrier? Evidence from the global financial crisis on the value of multiple requirements in bank regulation’, BoE Staff Working Paper (forthcoming).