samchain/econo-pairs-v1 huggingface dataset:
SPEECH DATE:  2017-01-17  SPEAKER:  Deputy Governor Cecilia Skingsley  SVERIGES RIKSBANK SE-103 37 Stockholm (Brunkebergstorg 11)  LOCALITY:  World Economic Forum, Davos in Switzerland  Tel +46 8 787 00 00  How the Riksbank encourages innovation in the retail payments market∗ Speaking points at the session Financial stability, innovation, economic growth initiative. We live in interesting times. At least if you are interested in questions about how financial services can be organized in a society. Technological in-  novation are driving change, but so are economic logic and regulatory measures. With change come new opportunities and new risks. We can be sure of that. But that is pretty much where certainty ends. What we don’t know is the full potential of these new opportunities, which of them will actually materialize and consequently, which stability risks we will be struggling with in the next decade or so. My message to the regulatory community is that we must be ready not only to talk about these matters, but also to walk the talk if we want to have an impact on this transformation. Let me illustrate with an example. In particular, I would like to share with you our experiences from Sweden and how the Riksbank has encouraged innovation in the retail payments market. As you may be aware, Sweden is a low cash society on the verge of becoming a very, very low cash society. Decreasing cash usage is, of course, mirrored in increasing use of electronic payments.

* * * These questions aside, one thing is clear in the case of France – and 2016’s too-feeble growth of 1.1%, as published yesterday, confirms it: estimates from national and international institutions all point to low levels of potential growth, at around 1.2%, and relatively high levels of structural unemployment (the equivalent of the NAIRU in English-speaking countries), at around 9%. Clearly, we cannot be content with these levels. All of which brings us back, overwhelmingly, to our four key focuses for reform: Enterprise, Education, Employment and Expenditure reduction (public sector). Our northern European neighbours have shown by example that these reforms 2/3  BIS central bankers' speeches  are not incompatible with our shared European social model. Studies by the Banque de France show in particular that reforms to the goods and services market could boost the productivity of the French economy by between 3% and 5% in the long-term. Without further ado then, let me pass the floor to Fabrice Lenglart, and I wish you all a fruitful and enjoyable conference. 1 www.banque-france.fr/en/secular-stagnation-and-growth-measurement-conference-organised-banque-de-  france-and-college-de  3/3  BIS central bankers' speeches
For ethnic minorities, where university degrees from abroad often end up in this category, the penalty is a lot smaller, at around 24%, compared with non-ethnic minorities. (b)  Age. Compared to the earnings of the 25-29 age group, each subsequent age group earns more up  to around the mid-50s, where the earnings ‘premium’ flattens out a bit. For example, those aged 45-49 earn a pay premium, on average, of around 19% compared with those aged 25-29. This pay premium is notably larger for white men than women or ethnic minorities. Men aged 45-49 earn an “extra” wage premium of around 10% compared with the other sub-groups. 31  All speeches are available online at www.bankofengland.co.uk/speeches  31  (c)  Part-time and non-permanent work. Part-time work, compared with full-time employment, reduces  earnings across all four sub-groups, on average by 16%. This discount is larger for white men (22%) than for ethnic minorities and white women (10%). If employment is not permanent, this also reduces earnings across the sub-groups, with white men again being affected the most (10% reduction in pay). (d)  Children under 2. Viewed on its own, having a child under 2 appears to have a positive effect on the  earnings of both white men and women, of 6% and 1% respectively. For ethnic minority men, the effect is not statistically significant while for ethnic minority women earnings are reduced by 1%.

Conversion arrangement for trade settlement in 2011 Following the substantial expansion of the geographical coverage of the cross-border RMB trade settlement scheme in June this year, the amount of cross-border RMB trade settlement has grown rapidly, from a monthly average of about RMB 4 billion in the first half of the year to about RMB 30 billion each month in August and September, and close to RMB 68 billion in October. Under such circumstances, the amount of RMB purchased by the Participating Authorized Institutions (Participating AIs) through the Clearing Bank in the China Foreign Exchange Trading System in Shanghai increased notably in October, and the conversion arrangement concerned was suspended in late October. In response, the HKMA promptly introduced a number of measures, and the RMB market in Hong Kong has been operating orderly and smoothly to date. As regards the conversion arrangement for 2011, after discussions with the People’s Bank of China (PBoC), the HKMA consider appropriate to introduce certain refinements to the arrangement for the conversion of RMB conducted by Participating AIs for their customers in relation to cross-border trade settlement.
Even though budget adjustments may curb economic growth in the immediate future, they will help ensure the sustainability of public finances and lower the risk premia of sovereign bonds. We must reverse the growth in debt burden and establish a framework which would support market confidence in the sustainability of public finance management in euro area countries. This is the common interest of all euro area Member States. 3. Alongside crisis management measures, we must lay emphasis on ensuring stability in the long perspective. To ensure an outlook for growth, we must implement structural reforms to enhance economic flexibility, competitiveness and employment. 4. The key task of the Eurosystem central banks, including Eesti Pank, is to ensure general price stability in the euro area. This should be the principle goal of monetary policy and the main mission of the central bank in its efforts to facilitate economic growth and create jobs. 2  BIS central bankers’ speeches  [CONCERNING ESTONIA] 1. Unlike several other euro area countries, Estonia had no need to engage in local crisis management in 2011. 2. The Estonian economy showed notable adjustment ability against the backdrop of the uncertain environment. Our annual economic growth (7.6%) was the fastest in the euro area. Moreover, the economic developments were far more balanced than before the crisis: the current account was in a moderate surplus and domestic price pressures remained subdued.

In public relations, Eesti Pank has repeatedly emphasised that central banks are being forced to take on a role that does not suit them. Functions that are alien to the Eurosystem are best left to the European Stability Mechanism. There are two advantages to such a solution. Firstly, establishing conditions for the award of financial support allows guiding the recipient country’s economic policy in the desired direction. As we all know, monetary policy measures cannot be used for eliminating the causes of the sovereign debt crisis. Secondly, this will tighten the control of the member states’ governments and parliaments over crisis measures and ensure a better overview of the costs of the crisis measures. [TO SUM UP] 1. The right decisions can only be made when we understand the economy. It does not serve our interests to monitor just our own activities – we also need to monitor the development plans and objectives of other euro area countries (and not only Greece or Portugal). The European Economic and Monetary Union already has all the good characteristics for the achievement of which the union was established to begin with. We now need to enhance the union’s efficiency, potency and security in the service of our best interests. Honourable President of the Riigikogu, honourable members of the Riigikogu. I would like to finish the speech by expressing my gratitude for the seven years of cooperation. Thank you for taking notice and account of the messages of Eesti Pank!
Figure 16 World: MPR and expectations (1) (percent) 14  14  12  12  10  10  8  8  6  6  4  4  2  2  0  0 00  02  Developed (2)  04  06  08  Emerging (3)  10  Chile (4)  12  (1) Solid lines show simple average of reference rates of each group of countries. Dots show Bloomberg median of analysts survey about expected MPR. EES is used for Chile. (2) Includes Canada, Eurozone, Japan, Norway, Sweden, Switzerland, the U.K. and the U.S.. (3) Includes Brazil, Colombia, China, the Czech Rep. Hungary, Mexico, Peru, Poland, South Africa and South Korea. (4) Data before the nominalization of reference rate (August 2001), consider overnight interbank rate in real terms plus CPI inflation. Sources: Central Bank of Chile, the respective countries' central banks, Bloomberg, and International Monetary Fund. 14  BIS central bankers’ speeches  Figure 17 MPR and expectations (percent) 9  9  8  8  7  7  6  6  5  5  4  4  3  3  2  2  1  1  0  0 07  08  09  EES May11  10  11  FOS 1Q May11  12  MPR  13  Source: Central Bank of Chile. BIS central bankers’ speeches  15

From the late 15th Century onwards, however, the term appears to have taken on negative connotations: “being contrary to what is agreeable or right; perversity; evil”. During the 18th Century, its fortunes changed again. At least some modern democracies began to view diversity as a virtue, a safeguard against any one faction exerting too much power. And from the middle of the 20th century, there has been a surge in the use of the word diversity, as laws and social norms have adapted actively to embrace it. Secular trends – demographic, legal, social – appear, then, to have reshaped the meaning of diversity. Overt discrimination has become unacceptable, legally and socially. Yet while reshaping biases, this changing societal landscape seems unlikely to have eliminated it entirely. Indeed, it is possible that societal shifts may have nurtured a different, more elusive, form of behavioural bias. Like its evolutionary forebears, this is to some extent rational, given the social ecology of the time. During the 20th century, psychologists began documenting work on social interaction in communities of people with differing characteristics. In the 1970s, Henri Tajfel and colleagues discovered that this behaviour often exhibited a strong “in-group” bias. People quickly adopted a social, as well as an individual, identity having attached to a group. For that reason, this has since become known as “social identity theory”. 10 Several important behavioural consequences flow from this theory. Groups become an important source of pride and self-esteem for the individuals attached to them.
On the regulatory front, a series of enhancements to the risk management regulatory framework has been introduced with the aim of promoting a more robust and comprehensive risk management practices within banking institutions. In addition, significant effort has also been put in place to prepare the industry towards the implementation of Basel II, which is targeted for January 2008 for the standardised approach and January 2010 for the IRB approach. The industry has responded well with various improvement measures that have been instituted, and investments made to enhance their systems and approaches to elevate their capability to manage risk exposures. This will contribute towards enhancing further overall financial stability, and towards the development of new products with better pricing of the financial services. The Islamic banking and takaful industries have been among the most dynamic in the sector. In terms of assets, the annual growth rate of Islamic banking and takaful averaged 19 percent and 25 percent respectively. In 2005, profitability of Islamic banking surpassed the RM1 billion mark for the first time, while its assets breached the RM100 billion threshold. As of end-March, the Islamic banking assets accounted for almost 12% of the total assets of the entire banking system. The takaful industry's assets stood at about 6% of the industry total. The Islamic banking industry has begun to maximise the competitive advantages of the Islamic banking concept of profit and risk sharing.

Boris Vujčić: Macroeconomic developments and structural issues in CEE countries Speech by Mr Boris Vujčić, Governor of the Croatian National Bank, at the Roundtable on Macroeconomic Developments of the 16+1 Economies, Magyar Nemzeti Bank (the central bank of Hungary), Budapest, 9 November 2018. * * * Accompanying slides of the presentation. Economic expansion in the CEE region can be expected to continue in the near term supported by still favourable cyclical conditions. However, in many countries pace of growth might moderate, partly due to supply side constraints and maturing business cycles. Potential growth estimates indicate that in all countries output gaps are positive or have been closed, and unemployment rates are close or below pre-crisis levels, pushing-up the wage growth. While such a positive outlook for future growth is somewhat disturbed by rising risks to the global economy, such as escalation of trade tensions or tightening of financial conditions, CEE countries seem to be in a generally good shape to withstand the impact of negative shocks. Current account positions have improved and in many countries turned into surplus, while international liquidity positions are ample. Also, economic recovery coupled with efforts to push through fiscal adjustment programs led to improvement of general government balance and public debt was put on a declining path. Furthermore, financial systems in most countries remain robust and resilient, as attested by withstanding the shocks emanating from the global financial crisis and the European sovereign debt crisis.
There has also been some further deregulation. For instance, state monopolies have been abolished and freedom to establish new companies with regard to, for instance, transport, communications and energy has been introduced. Changed competitive conditions thus affect productivity growth, but they can also affect price developments more directly. Despite the fact that we gained much stiffer legislation on competition in 1993, developments in this field appear to be moving slowly. Swedish prices remain higher than in other countries in several areas without explanations for this in the form of differences in VAT rates and wage levels. Increased competition can contribute to price levels converging, but this assumes that the relative price changes will be accepted and it can entail, as in the 1990s when electricity and telecommunications were deregulated, such large price reductions in some sectors that our inflation rate will be lower than that of other countries. Special interests and consumer interests Limits to competition are a clear example of how special interests dominate over general consumer interests. There are many examples of this in various areas of the Swedish economy, and in particular the construction sector. This means that we allow inefficiency to remain, which reduces growth and the development of most people’s standard of living. One interesting and very recent example of how special interests have declined concerns pharmaceutical prices.

These opposing wishes can be reconciled via banks, and also directly via the financial markets. The latter assumes that there are well-developed secondary markets with a large turnover in, for instance, equity. This enables companies to borrow long-term while savers can quickly sell their shares if they so desire. Risks are managed through the spread in borrowing, but also by transferring them, against payment, to others in the financial market. The spread and redistribution of financial risks enables investments to be made that would not otherwise have been possible. The third and final main task is the intermediation of payments, which enables payment to be smoothly made and received for goods and services sold either in the conventional manner or via, for instance, the Internet. 2  BIS Review 37/2003  In countries like Sweden we tend to take it for granted that these functions work. However, if we try to imagine that they did not exist, we will realise how extremely central they are to the functioning of the economy and to our welfare. If we imagine a country where savers and investors did not have access to functioning and reliable banks and financial markets, it is easy to see how this would hamper development. The effect would be a tendency for savings to move abroad, while profitable investment projects did not get off the ground in countries with an undeveloped financial sector. If we look back at the 1950s, we can see that the intermediation of payments functions much more smoothly today.
Loan losses increasing SEK billion net, totalled over four quarters, fixed prices, 31 March 2009 120  120 Results before loan losses Loan losses  100  100  80  80  60  60  40  40  20  20  0  0 -20  -20 90  92  94  96  98  00  02  04  06  08  10  Source: Finansial Stability Report 2009:1, the Riksbank  8  BIS Review 98/2009  3. World GDP growth Annual percentage change 8  8  7  7  6  6  5  5  4  4  3  3  2  2  1  1  0  0  -1  -1 -2  -2 70  75  80  85  90  95  Note. The broken column represents the Riksbank’s forecast. 00  05  10  Sources: The IMF and the Riksbank  4.

Current account and public finances Per cent of GDP 12  12 Government net lending Current account  8  8  4  4  0  0  -4  -4  -8  -8  -12  -12 90  92  94  96  98  00  Note. Broken lines represent the Riksbank’ s forecasts. 02  04  06  08  10  12  Sources: Statistics Sweden and the Riksbank  22. Low repo rate over long period of time Per cent, quarterly average 7  7  6  6  90% 75% 50% Repo rate  5  5  4  4  3  3  2  2  1  1  0  0  -1  -1  -2  -2 04  05  06  07  08  09  10  11  Note. The uncertainty interval is calculated using historical forecasting errors. 18  12  Source: The Riksbank  BIS Review 98/2009  23.
First, a degree or diploma in STEM (Science, Technology, Engineering, Mathematics) provides a good head start. One does not need to have a tech qualification to take on a tech job. Financial institutions have been hiring engineering and science graduates as well. Financial institutions are also open to training mid-career Singaporeans with STEM backgrounds from other sectors too. Second, fundamental programming skills are essential. Demand is shi ing away from traditional roles like IT project manager and IT support, to product owners and so ware engineers. There are two kinds of so ware engineers: General app developers who focus on front-end and mobile app development; and Enterprise so ware developers who need deep technical skills that come from years of programming experience and knowledge of core banking so ware. Demand for enterprise so ware developers is much higher. Third, business domain knowledge is important. Gone are the days when technology professionals were at the back-end, building systems for business functions they had little interaction with. The demand today is for biz-tech or ops-tech integration. In financial services, tech professionals are expected to have business domain knowledge, to better support business needs. Fourth, overseas exposure is valued. As Singapore houses many global and regional tech hubs, tech professionals need to understand overseas markets to build better quality products and solutions. This means taking up overseas postings in countries like India and China, where there are large pools of tech talents to work with and learn from.

Indeed, the major global custodians each posted growth in assets held in custody in excess of 20% in just the past year. 31 And differences between the regulatory regimes for incumbent providers of infrastructure and those for either commercial bank providers or smaller new entrants could tilt the playing field. For example, CLS is subject to close central bank scrutiny, operates as a narrow bank, and has to meet exacting – and costly – resilience standards. New clearing arrangements and bilateral netting schemes are now penetrating the foreign exchange markets, threatening the volumes passing through CLS. In messaging, too, SWIFT – which submits voluntarily to central bank oversight – is beginning to face competition in certain markets from new entrants not subject to oversight. Authorities must be alert to the challenges these competitive developments provide. 32 Other regulatory initiatives are contributing to a reshaping of the landscape. MiFID, in the EU, and RegNMS, in the US, have sought to encourage increased competition in trading; and the Code of Conduct, recently signed in the European Union, establishes terms under which infrastructures operating in one member state can clear and settle (initially equity) trades in another. More than 20 applications have now been made under the terms of the Code. 4  BIS Review 130/2007  33 Whether trading, clearing and settlement infrastructure markets can support a wide range of providers in the long-term remains an open question.
If the risk that a client might fail became too high, a clearing bank could decide not to unwind that client’s trades in the morning, leaving its investors with the collateral. Most of these investors lacked the operational or financial capacity to take possession of collateral and liquidate it in a gradual manner to recoup their investment; they had a strong incentive to run at the first sign of trouble to avoid getting stuck with the dealer’s collateral. Alternatively, if a client were to fail suddenly after the mornings unwind, then the clearing bank would be stuck with huge loans to these counterparties that could have put their own viability at risk, backed by securities that were not necessarily high quality and liquid. The “breaking the buck” by the Reserve Fund following the Lehman bankruptcy also made it clear that the monies provided to the money market mutual funds by their own investors were also inherently unstable. This made such funds, in turn, an unreliable source of finance in repo, commercial paper and other markets. Investors in a fixed net asset value (NAV) money market fund could take their money out on a daily basis at par value, with no redemption penalty. This could occur even if the money market fund did not have sufficient cash or liquid assets that it could easily sell to meet all potential redemptions.

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