samchain/econo-pairs-v1 huggingface dataset:
BIS central bankers’ speeches  You can see why it is referred to in the business as “the dot chart.” The best guesses of the entire panoply of participants in FOMC deliberations – 19 when we have a full complement (the 12 Fed bankers and the maximum of seven governors appointed by the president subject to approval of the Senate) – are summarized in dots with the expected level on the “y-axis” and the year at the end of which it is thought likely to occur on the “x-axis.” I use the term “best guesses” deliberately. The participants in the FOMC have sophisticated econometric models, a deep knowledge of theory and a great breadth of experience to draw upon. But truth be told, however we dress up our forecasts as rigorous analysis, they are no more than the very best educated guesses of the superbly trained but still human staffs of the 12 Fed bankers and the active governors. And the composition of those among the FOMC participants who actually vote on policy changes periodically. With the departure of Governor Jeremy Stein at the end of this month, we will have eight people, including me, who vote on policy for the remainder of this year. We are hopeful that the full Senate will confirm the two governors who have now come out of the Senate Banking Committee, but we don’t know when that will occur. That will bring the total number of voters to 10.

And that they represent only a fifth or less of the credit markets in the U.S. And yet as I speak, depository institutions, including foreign banks doing business in the United States, have $ trillion in excess reserves on the books of the 12 Federal Reserve Banks. So one would be hard pressed to say that ending our asset purchases, which the depository institutions from which we buy them deposit back with us as excess reserves, would deny the economy needed liquidity. “Normalizing” policy The focus of our discussions now is when and how to “normalize” monetary policy. Given that we work directly with only 20 percent or less of the highly developed U.S. credit intermediation system, this becomes a complicated matter. It raises questions, for example, about whether we should focus on the federal funds rate, which has been our traditional fulcrum, or some other measure, such as the rate we pay on excess reserves or that we pay on overnight reverse repos or some mix thereof. You can expect to hear more about this as  BIS central bankers’ speeches  3  time passes. Today, I am going to focus on another aspect of “normalization,” and that is: Once we have wound down QE3, when are we likely to raise the short-term rate that anchors the yield curve? In the parlance of the trade, market operators and bankers alike are seeking “forward guidance” about our intentions.
The root causes of job polarization appear to be technology and globalization, which have displaced many jobs, particularly those involving routine tasks. This loss of jobs has been especially pronounced for what we often think of as traditional middle-skilled workers. Its impact is perhaps most evident in the manufacturing sector, where so many jobs have been lost in recent decades. Given the strong history of manufacturing in our region, job polarization has been an important feature in our local economy. No doubt, the widening wage gap and loss of job opportunities for middle-skilled workers has contributed to a rise in economic inequality and created challenges for many workers and their families. More than ever before, jobs are requiring a greater degree of knowledge and skill. In order to adapt to these changes, it is increasingly important for workers to acquire and upgrade their skills, whether through formal education or other forms of training. In addition, it is important for employers to communicate their needs to educational institutions  BIS central bankers’ speeches  3  so that they can offer the coursework and programs so that people can develop the right skills to fill the available jobs. For these reasons, we think it is particularly important to highlight these trends in today’s briefing. Conclusion In summary, recent data are consistent with the expectation of moderate growth in 2012 and stronger, but still not robust, growth in 2013. I also expect both headline and core inflation rates should moderate over the next few months.

The total banking sector assets in all new member states are only 345 USD billions at the end 2002 (thus just 31,5% of Citigroup, or 43,4% of Deutsche bank, or 45,5% of HSBC). Structure of ACs Banking Sector Assets  3%  2% 2% 1%  1% POL CZ  7%  HUN 38%  7%  CYPR SVK SLO LAT LIT  15%  EST MALTA  24%  * As of 31st Dec 2002, recalculated by market exchange rate  BIS Review 53/2003  19  3  A look at financial depth [as measured by banking sector assets to GDP] of individual markets in five accession countries [Czech Republic, Hungary, Slovakia, Poland and Slovenia] shows that there is still significant space for growth of financial intermediation. Financial depth in the CR is the highest among the transition economies, but it is still significantly lower than in the EU [EU average 270%]. Financial Depth (Bank Assets/GDP in %) 130 120 110 100 CR HUN SVK POL SLO  %  90 80 70 60 50 40 1996  1997  1998  1999  2000  2001  2002  7  Besides developments in banking, we can observe continuous growth also in non-banking financial intermediation [illustrated by Czech Republic]. In the Czech Republic, the share of non-banking financial intermediation on GDP increased over last two years from 19% to 21,7%. The highest increase was in the share of insurance companies and financial leasing institutions.
It is an elaborate conceit to think anybody can be that precise in an economy as large as that of the United States, operating as it does within the context of an even larger, very dynamic, global economy. This is true for Fed economists as well as academics and those who sell their forecasts for a living. This is not to say that we will cease and desist from making “point” forecasts. But what matters most to me is the direction in which the numbers are headed and the general sense of momentum. At this juncture, I think it sufficient to say that, assuming the people we elect to tax us and spend our money and create the rules and regulations that govern our economic behavior can at long last get their act together, confront their own denial of most rudimentary budgetary discipline, learn to shoot straight and remove the Damocles Sword of uncertainty that they have for too long unwittingly wielded over our job-creating private sector, there is plenty of potential for the economy to move forward at an accelerating clip. This is especially the case now that the Fed has reliquified the economy. I expect that economic activity will accelerate in the second half of this year, with real GDP likely to rise at an average annual rate of between 3 and 4 percent.

The punch line, of course, was that if you didn’t believe a man could fend off a croc with his bare hands, then you yourself were in “de-Nile.” We are no longer in denial about our national economic plight. Our great country now finds itself in a very difficult predicament. It is true that the situation here in Texas is relatively better than that of the nation; Texas is an oasis in a national economic desert devoid of lifegiving job creation. We went into the Great Recession last and were one of the first to come out. As we have for the past 20 years, we continue to outpace the rest of the United States in employment growth by a significant margin. Since the Great Recession officially ended in June 2009, only North Dakota (a plucky state whose hearty population totals less than that of Collin or Denton counties) has seen faster job growth than Texas.1 As I speak, Texas has almost as many people employed as we did before the recession began. Our banks are in better shape than those in the rest of the country; we are benefiting from the blessings of nature, with copious amounts of oil and gas and abundant agricultural production; our fellow citizens have seen to it that our Legislature continues to hew to a tax, regulatory and legal environment that attracts job-creating investment and encourages business formation and growth.
And if and when there were a serious co-ordination challenge – if, for example, one body became concerned about its ability to meet its primary objective, without enlisting the assistance of the other – then I think the current system in the UK would allow that to happen. Equally, there are also clear advantages in a degree of separation. One – something I haven’t gone into today but which still matters a great deal – concerns specialised skills. The two committees at the Bank profit greatly from having external members steeped in particular experience, whether that’s monetary experts on the MPC or financial experts on the FPC. Another, the topic of this talk, is a matter of accountability and focus. I think there would be risks in asking the central bank to meet a wide range of objectives with no distinctive accounting for the use of its various tools. Thank you. 14  All speeches are available online at www.bankofengland.co.uk/speeches  14  References Aikman, D., Giese, J., Kapadia, S., & McLeay, M. (forthcoming), “Targeting Financial Stability: Macroprudential or Monetary Policy?”. Baskaya, Y., di Giovanni, J., Kalemli-Özca, S. Peydro, J., Ulu, M. F. (2017), “Capital flows and the international credit channel”, Journal of International Economics, Vol. 108, Supplement 1. Bianchi, F. and Melosi L. (2018), “Constrained Discretion and Central Bank Transparency”, Review of Economics and Statistics, Vol. 100, No. 1, pp. 187-202. Bean, C. (2010), “Monetary policy after the fall”, Speech given at Federal Reserve Bank of Kansas City Annual Conference Jackson Hole, available at https://www.bankofengland.co.uk/speech/2010/monetarypolicy-after-the-fall-speech-by-charles-bean.

Even if she’s not that sure of her initial 8% estimate – the blue line illustrates the case where the standard deviation around her prior is 2% points – it’s still likely to take more than 100 years for the observer’s central estimate to fall even half way to the truth (i.e. to 6%). If the observer’s wrong but confident (the red line illustrates the case with a 1%-point standard deviation around the initial 8% prior) one would expect it to take well over half a millennium to get to that point. King John and the  Source: Bank calculations. barons might have tightened prudential regulation in the Magna Carta and her acknowledgement of its benefits would even now be somewhat grudging. This is, as I say, a wholly unrealistic experiment because we get to see far more than the simple occurrence (or non-occurrence) of a financial crisis. Our sceptical observer would presumably be aware of the prudential legislation and, more importantly, its effects on things that relate to financial risk (asset valuations and banks’ capital ratios, for example). That information would allow a much faster updating of estimated risk than in Chart 9. In the real world, the information set available to the FPC, and by which its performance can be judged, is richer still. Having seen several such events, in many countries, we know quite a bit about what typically precedes them. Stress-testing gives us an extremely useful and powerful way to expand our knowledge about the impacts of “tail events”.
18  4  6  8  10  12  14  16  Sources: Statistics Sweden and the Riksbank  BIS Review 23/2009  Lower interest rate to subdue fall in production and employment and attain inflation target of 2 per cent  The Riksbank will continue to take the measures required to safeguard financial stability  Repo rate forecast 2008, per cent, quarterly averages 5,0  5,0  4,5  4,5  4,0  4,0  3,5  3,5  3,0  3,0  2,5  2,5  2,0  2,0  1,5  Repo rate Repo rate forecast MPR 08:1 Repo rate forecast MPR 08:2 Repo rate forecast MPR 08:3 MPU December 08  1,0 0,5 0,0  1,0 0,5 0,0  02  03  04  05  06  07  08  09  Note. PPR denotes M onetary Policy Report och PPU denotes M onetary Policy Update. BIS Review 23/2009  1,5  10  11 Source: The Riksbank. 19  Profits before credit losses and net credit losses, in the major banks, summarised over four quarters, SEK billion at 2008 prices 100  80 Profit before credit losses Credit losses  60  40  20  0  -20 dec -90  dec -92  dec -94  dec -96  dec -98  dec -00  dec -02  dec -04  dec -06  dec -08  Note. International Financial Reporting Standards applied from and including the first quarter 2005.

In 95% of cases, the massive fluctuations in our income can be attributed to the fluctuating values in gold and foreign exchange positions. Experience has shown that valuation gains and losses on financial investments tend to level out again in the long term. Based on these conditions, we thus estimate the earnings potential of our assets to be between 2% and 3%, which translates into an income of between CHF 1.7 and CHF 2.5 billion per annum on the total assets of CHF 85 billion. Given the fluctuations in the exchange rate and gold price, however, the earnings generated can deviate greatly from this amount. For instance, the marked increase in the gold price this year has resulted in valuation gains of roughly CHF 8 billion to date. Should the gold price drop back next year to its end-2003 level, however, this would lead to a valuation loss of over CHF 7 billion. Long-term income estimates should not be based on such unusual gains and losses. Some of the income is allocated to provisions, thereby ensuring the growth of the currency reserves necessary for monetary policy. This allocation (currently approximately CHF 1 billion per annum) should be made in proportion to nominal GDP growth. After deduction of the SNB’s operating expenses of currently CHF 250 million, roughly CHF 1 billion remains for distribution to the Confederation and cantons. Based on the assumptions regarding the earnings potential of our assets, we can expect a distributable annual profit to be somewhere in this region in the foreseeable future.
As part of the Committee’s general efforts in recent years to enhance its relationships with supervisory agencies outside its member countries, the AIG has itself begun a dialogue with other supervisory agencies. In fact, based on the AIG’s early discussions, the Committee published a paper in August on the “high level principles for the cross-border implementation of the New Accord”. In this document, we reiterate our view that home and host supervisors will retain their traditional responsibilities in regulating internationally active banks under the New Accord. Nonetheless, the revised capital framework will require an even higher level of cooperation among supervisors. Let me mention areas such as the initial approval and validation of “advanced” approaches to credit and operational risk under Pillar 1; the supervisory review process under Pillar 2; and ongoing assessments of compliance with the requirements for the use of “advanced” approaches. Although supervisors must make practical arrangements to carry out these responsibilities, the Committee wishes to implement the New Accord in a manner that strengthens the quality of supervision across all countries. Moreover, we recognise the special role we can play in helping to ensure that all host supervisors, and especially those from emerging market countries, are able to supervise the local operations of foreign banks effectively. We will continue to work with emerging market supervisors and the World Bank and IMF, as well as with the Financial Stability Institute and others to exchange ideas on ways to strengthen the regulation of both domestic and internationally active banks.

By contrast, our monetary policy decisions as well as other measures aimed at stabilising the financial system are reflected in the composition and size of the balance sheet. Accordingly, it is of key importance for the effectiveness of our measures in the fields of monetary policy and financial stability that we have the option of making flexible use of our balance sheet. There are therefore no statutory limitations with respect to the size or composition of our balance sheet. This flexibility played a major role in ensuring that we remained capable of acting during the crisis, even in very difficult conditions. It enabled us to fulfil our mandate of ensuring price stability and also of making a contribution to financial stability as part of this mandate. Let me give you two examples of the way in which we make flexible use of our balance sheet. For topical reasons, I would like to start by talking about the creation of the stabilisation fund. The stabilisation fund, as we called it, was an undertaking which commenced in 2008 and was successfully concluded last year. What was involved? You will recall that in October 2008 a Swiss big bank, UBS, was in substantial difficulties. Financial stability was threatened and intervention by the authorities was absolutely necessary. Consequently, the Federal Council, the Swiss Federal Banking Commission (predecessor of FINMA) and the SNB decided on measures to stabilise UBS and thereby strengthen the Swiss financial system.
Provided that link is secure – the hub’s resilience is beyond question – counterparty uncertainty is effectively eliminated. Table 3 simulates the benefits of introducing a CCP in reducing counterparty uncertainty. As in the earlier example, Knightian uncertainty is measured by the size of the range of CDS spreads. In all cases, moving to a central counterparty (n = 1) results in a material reduction in uncertainty around spreads. These benefits are predicated on the CCP “super-spreader” itself being impregnable to attack. There have been various initiatives over the recent past to introduce central counterparties for the clearing of certain financial instruments, including CDS products over the past 18  36  Carlson and Doyle (1999). 37  Kelling et al (2003). 16  BIS Review 53/2009  months. 38 This is welcome. But the debate needs not to end there. A much broad range of over-the-counter financial instruments, both cash and derivatives, could potentially benefit from the introduction of a central counterparty. Central counterparties are of course not new. Clearing houses date from the early 19th century. But, latterly, the question often most asked of central counterparties has been “Why”? Experience during the crisis means we now know why. From a network resilience perspective, it is important that in future the central counterparty question becomes not “Why?” but “Why not”? Second, financial innovation has created strings of gross claims between financial entities which far exceed their capital bases. Lehman had gross CDS exposures around eight times its balance sheet.

Attachments to top business newspapers in South Africa and training our journalists in economics at the University of Zambia should give us the comfort that a specialization is being built from which we can confidently tap into and exchange ideas and analysis. One of the challenges for our writers has been a lack of specialization. As such, they have had to understand all subjects broadly rather than in-depth to help them to communicate more authoritatively. As they are being strengthened through various training interventions, we should therefore be able to see a marked improvement in their performance. In this vein, I am told that the American Centre and the Canadian High Commission have also been keen stakeholders in training our journalists in this area and to this end have worked closely with ACCA over the past two years in delivering one week workshops on key topical areas. The partnerships demonstrate that there are a number of interested stakeholders that all have a common goal – good, reliable and timely information. The announcement of the national budget is round the corner. It is that time of the year when many differing analysis are made. Don’t take these analyses at face value – examine them in your own right and come up with alternative lines of reasoning so that the public can have a holistic view of the effects of the budget pronouncements. We would indeed expect this for any other economic, business and financial pronouncement.
The Bank has already established arrangements under which non-bank payment service providers could access RTGS directly. We are now using the Fintech Accelerator’s proof-of-concept approach when considering how new technologies can plug into the renewed RTGS. We recognise the potential for new technologies to create a more distributed and diverse payments system. So we are doing a proof-of-concept with a small cohort of firms to consider how our renewed service could interface with 15  innovative settlement systems , such as those built on distributed ledger technology. The proof of concept is designed to assess the demands that would be placed on central RTGS infrastructure by a range of fintech firms’ settlement models, rather than assessing the specific offering provided by a particular firm. By allowing a range of system structures to access the new RTGS system, the Bank can support innovation in the private sector. And the Bank of England is continuing to investigate ways in which fintech could help to improve regulation, building on existing work internally and in collaboration with the FCA. We have initiated work to understand how machine readable technology could be applied to the next iteration of the PRA rulebook, and will continue to work closely with the FCA to understand the potential for machine readable regulation. We are also investigating if machine learning could be deployed to support judgement based supervision, via its application to both structured and unstructured data. Investment in the UK’s financial technology is going to be an important factor in sustaining the UK’s global position.

The Bank of England – Open to Fintech Remarks given by Dave Ramsden, Deputy Governor for Markets and Banking, Bank of England  HMT’s International Fintech Conference, London 22 March 2018  1  All speeches are available online at www.bankofengland.co.uk/speeches  Thank you for the opportunity to be here this afternoon at this important conference, speaking on behalf of 1  the Bank of England as Deputy Governor with responsibility for the UK’s RTGS and the CHAPS high value payment systems. We are discussing the latest stage in the evolution of the UK’s financial services sector and London’s role as a global financial centre. Different infrastructures supported this evolution at different stages. My focus will be on the technological infrastructure to support fintech, where both private and public sectors have a role to play. These are not new themes. At the time of the Big Bang, new technology was required to support electronic trading. The Bank of England contributed to the infrastructure development, setting up the Central Gilts 2  Office in 1986 - which permitted delivery versus payment for Gilts . In 1996 the same was enabled for equities and corporate bonds via CREST, and later that year the launch of RTGS eliminated intraday settlement risk between banks, delivering real time settlement finality of sterling transactions. The need for the Bank of England to continue to play its part in contributing to the infrastructure of the financial sector is more relevant today than ever.