samchain/econo-pairs-v1 huggingface dataset:
The remaining challenge then is whether the authorities will have the nerve to follow through and carry out a resolution. This is the charge that comes from opponents, namely that it will be “bottled”. I don’t see this as likely to be an issue, because if resolution is a credible route to take, as it will be, why would the authorities want to put the cost somewhere else? 3  John Kay “Should we have ‘Narrow Banking’?” The Future of Finance, LSE Report, 2010  4  Anat Admati and Martin Hellwig: “The Bankers New Clothes: What’s wrong with Banking and what to do about it”. P271  5  Anat Admati and Martin Hellwig: “The Bankers New Clothes: What’s wrong with Banking and what to do about it”. P74–78  BIS central bankers’ speeches  3  Now for supervision and whether it too can function effectively. Make no mistake, in many countries supervision failed badly in the run-up to the crisis. Prudential supervision of banks is all about understanding the risks firms take, the effectiveness of the controls in risk management, using the framework of rules and regulations to create the right incentives to control risks appropriately, and where necessary intervening directly to require actions to be taken that would otherwise lead the firm to a potentially unsafe or unusual position.

In that context, and fully consistent with the priorities of Her Majesty’s government, the Bank of England will work to build a responsible financial globalisation that first protects and serves the UK real economy, and then secures the UK’s traditional role of supporting global prosperity through an open global economy. II. The UK Financial System is a National Asset and a Global Public Good  Having a large financial sector brings substantial benefits to the UK. 4  Financial services accounts for 7% of output and is a source of over 1 million jobs, two thirds of which are outside London. It contributes around £ or 11%, of annual tax revenues. 5  Financial services are the UK’s most important exports, running a trade surplus of around £ or 3% of GDP. The rest of the economy runs a deficit almost twice as large. Being at the heart of the global financial system reinforces the ability of the rest of the UK economy, from manufacturing to the creative industries, to compete globally. And it broadens the investment opportunities for UK savers, giving them the potential to earn better risk-adjusted returns. But the UK’s financial system is more than a national asset. It is also a global public good. 6  The UK is the leading internationally active financial centre. It has the largest global share of cross-border bank lending and foreign exchange trading, the second largest asset management industry, and the fourth largest insurance industry in the world.
First, we can naturally only hold currency reserves in foreign currencies and not in Swiss francs. Second, the Swiss franc has the character of a safe haven at times of increased uncertainty in the economy and on the financial markets. Thus I have shown how there is a frequent negative correlation between equity prices and the external value of the Swiss franc. Third, I have also drawn attention to the fact that we have to carry the currency risk against the Swiss franc, since for monetary policy reasons we cannot hedge it. These factors constitute significant limitations on the diversification effect of our equity investments. Ultimately, they mean that the SNB’s equity share is fundamentally lower than in the case of many other investors. The point at which we wish to position ourselves on the efficient frontier between B’ and C’ depends on how we weigh up additional risk and higher return. At present, this weighing-up produces the equity share of 16% which I mentioned before. The SNB as a passive investor How does the SNB carry out its equity investments? In brief, the SNB is a passive investor in the stock market. In other words, the SNB basically does not select individual equities. Instead, we use rule-based procedures to invest in a very broad equity universe. At present, the SNB holds some 6,000 securities in more than ten currencies. The equity universe on which our equity investments is based covers some 90% of global market capitalisation. We mainly invest in mid and large cap companies.

Conflicts of interest with regard to investments in mid and large cap banks can come about because, according to its mandate, the SNB is also required to contribute to the stability of the financial system. Under certain circumstances, this can mean that the SNB has an information edge over the market with respect to the financial situation of individual banks. In order to avoid any suspicion that the SNB might make use of this information edge in its position as an investor, we completely exclude all investments in equities of such banks. Moreover, by doing so, we prevent market participants from attributing any signal effects to our transactions. On the question of conflicts of interest, I would also like to stress that, as a matter of principle, the SNB does not own equities in any Swiss companies for investment purposes. Should equities of individual companies be excluded from the investment universe on the basis of ethical criteria? We have been discussing this question for a considerable time and last year we made a fundamental decision. We do not invest in companies that blatantly infringe certain ethical principles. This decision was already implemented in the fourth quarter of 2013. To be specific, we do not hold equities in companies which produce internationally banned weapons, seriously violate fundamental human rights or systematically cause severe environmental damage. We believe that it is in the best interests of monetary policy if the SNB achieves sound investment returns through the widest possible diversification.
And at the Norges Bank, staff produce material that explicitly sets out possible strategies for interest rate decisions in the form of a range of interest rates for the next 3-4 months, and invite the interest rate setting committee to endorse them, and provide a commentary on market expectations of future interest rates. As Charles Goodhart has argued, it is difficult, as a practical matter, to imagine a committee of nine individually accountable experts doing that. Institutional and political arrangements matter. What works in one environment may not work elsewhere. And central banks need to employ consistent modes of communication and language if they are to be well understood. Abrupt changes in what is communicated, and how, always carry risks of confusion. But even the best designed system needs to evolve. Greater transparency involves learning both by policymakers and by those who seek to interpret their actions. The degree of monetary policy transparency in the UK now would have been regarded as quite unthinkable fifteen years ago. I see no reason to suppose that we have reached the end of the road yet. Conclusions Published forecasts have come to play a key role in formulating and communicating interest rate decisions within the UK approach to inflation targeting. The strength of this approach is that – flawed and inadequate as all projections inevitably are – a good forecast paints a picture that is worth a thousand words.

How far do our forecasts appear to drive interest rate decisions? And is there any evidence that this has helped to make policy more or less predictable? Finally I want to end by commenting on some of the issues raised by forecasts as a means of communication. Why the MPC has always been involved in forecasting The MPC’s early involvement in the forecast process is firmly rooted in the kind of committee it is, as well as the nature of the remit it has been given. The objectives of UK monetary policy have been expressed in terms of an annual inflation target since 1992, but responsibility for achieving the target initially lay with the Treasury, acting on the Bank’s advice. In 1997, as part of a wide ranging restructuring of the Bank of England’s role, decisions about interest rates were delegated to the Bank’s new MPC. Its nine members – five internal Bank officials and four external members chosen for their relevant knowledge and experience – are individually, and publicly, accountable for meeting the inflation target. The Government remains responsible for setting the annual inflation target, within the context of legislation that requires the Bank of England to achieve ‘price stability and subject to that to support the government’s objectives for output and employment’. Under its current remit, the MPC is required to achieve 2% consumer price inflation ‘at all times’.
It goes without saying that it is difficult to assess where you are going if you do not know where you are today. Assessing the current situation thus lies at the very core of all forecasting. Such an assessment does not simply entail producing forecasts for outcome data like GDP and the CPI, it also involves having to assess demand and supply factors in the economy. In this context the assessment of resource utilisation plays a prominent role. If resource utilisation is low then the economy can grow rather rapidly without prices and wages increasing in an alarming way. If it is strained then high growth may lead to overheating tendencies that could be reflected in excessively high inflation. So, even if the Riksbank produces fair forecasts of economic growth monetary policy may be less well-balanced if we misjudge resource utilisation. A complicating circumstance in this context is that resource utilisation, unlike GDP growth, cannot be observed directly. This underlines the fact that the assessment of the current situation is fundamentally an assessment of the state of the economy that is very difficult to make. Confidence indicators, which capture the mood of the economy, play an important role in the assessment. High values in the confidence indicators normally entail relatively strong growth in consumption, exports and investment, all else being equal. Important confidence indicators include the purchasing managers’ index, data from various business tendency surveys and surveys on expectations relating to wages and prices, but there are many more.

Ardian Fullani: Agreement between the Bank of Albania and the Competition Authority Speech by Mr Ardian Fullani, Governor of the Bank of Albania, at the signing of the Memorandum of Understanding, Tirana, 17 July 2007. *  *  *  Dear participants, I am pleased to have concluded this co-operation agreement between the Bank of Albania and the Competition Authority. In observance of the legal responsibilities of the institutions we represent, this agreement concludes the formal basis for cooperative efforts, in terms of achieving the objective of enhancing the competition conditions, in which the banking and financial activity is being conducted. Fair competition promotes the efficiency in the banking business and refines the composition and the functioning of the banking market, by providing significant services to clients and the public at large, being users of banking and financial services. It has been for some years now that the Albanian economy and the financial system are in an intensive process of integration into the regional economies and markets. This process requires the improvement of the legal and regulative framework for developing the business and the enhancement of the human and institutional capacities to cope with the challenges deriving from the economic openness and the enhancement of competition.
Asia has therefore adopted a different approach to regional integration. The effort towards integration is from the perspective of strengthening economic and business ties, complemented by strengthening the resilience and stability of the financial sector. Towards this, regional surveillance mechanisms are being put in place reinforced by financial support facilities and an integrated framework for crisis resolution. Various forums among regulators and central banks are already in place across most of Asia to collectively enhance crisis management. Such fora also serves as financial safety nets across the region to ensure that the financial institutions operating in this region will be able to withstand the destabilizing spill-over effects of a global financial crisis in an orderly manner. Malaysia is already implementing such arrangements, with swap agreements and cross border collateral arrangements that will serve as an alternative avenue for banks operating in Malaysia and the region to obtain liquidity for their efficient functioning including during challenging times. BIS central bankers’ speeches  3  Bilateral arrangements that are now being entered into will allow for the acceptance of each others’ currency and securities as collateral. Strengthening economic and financial ties with India The potential for collaboration between India and Malaysia is tremendous. Historic and cultural ties originate many years back and form a strong foundation for the relations to be strengthened going forward.

This is not a large amount, of course, but a modest beginning can grow into something large, and it will be possible to step up the purchases when foreign currency inflows increase from current levels. The stability and subsequent appreciation of the króna have played a leading role in the recent disinflation episode, with inflation falling from 18% in early 2009 to 3.3% in October 2010. Excluding tax effects, inflation measures only 2.6%, which is very close to the Central Bank’s inflation target. Headline inflation now looks set to reach the inflation target by the end of this year. But the slack in the economy has also played a major role, as has cautious monetary policy relative to the circumstances. It is emphatically not a given that this progress should be made, and spare capacity in the economy does not produce price stability by itself, as innumerable examples illustrate, the most dramatic among them the runaway inflation in Germany’s Weimar Republic and, more recently, Zimbabwe. It was therefore necessary to achieve exchange rate stability and bring inflation expectations down towards the target. This could not have happened if the Central Bank had complied with the wishes of those who went furthest in demanding a sudden, steep, and untimely interest rate cut. But in spite of all  BIS Review 158/2010  1  this, interest rates have fallen significantly.
Jessica Chew Cheng Lian: Integrated risk management approach for maintaining resilience & sustainability Speech by Ms Jessica Chew Cheng Lian, Assistant Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the Business Continuity Management Conference “Integrated Risk Management Approach for Maintaining Resilience & Sustainability”, Kuala Lumpur, 15 September 2015. *  *  *  I would like to thank the Disaster Recovery Institute, Malaysia and Sterling Risk Solutions for the invitation to speak at this Business Continuity Management (BCM) conference. Today, the ability of corporations to effectively manage risks has become a key factor that determines the agility and resilience of businesses. Business imperatives are changing so dramatically that risk management has become a more significant part of most organisations out of sheer necessity – largely driven by regulation, the desire to avoid costly sanctions, or to respond to increasing environmental and political risks. In leading organisations, the successful integration of risk management with strategic and commercial decision-making is creating important competitive advantages that are likely to be sustained over the longer term. This distinct organisational strength is one that cannot be easily replicated for the simple reason that building and maintaining a complete organisational response to strategic risk management, unlike say introducing a new product or marketing strategy, is not something that is accomplished within a short period of time.

Given the concentration of growth and development in emerging economies, going forward, the extent of underinsurance is a concern. In many of these economies, efforts are being aggressively pursued to increase awareness of the importance of insurance protection in helping one manage risks, and to develop an effective insurance market to meet these needs. The insurance industry in Malaysia currently stands at crossroads of implementing important reforms being introduced by Bank Negara Malaysia both in the general and life insurance sectors. The objective of the reforms is to further enhance the competitiveness of the industry, ensure its continued resilience, and encourage greater innovation in solutions offered for households and businesses to better manage risks. To this end, two aspects of the reforms are significant. The first is the progressive strengthening of prudential standards that aim to improve underwriting and risk assessment capabilities within insurance companies, while substantially strengthening incentives for insurers to differentiate themselves in the market. The second is the structural changes that are being introduced to reduce market distortions and drive efficiency improvements. Beyond domestic borders, the Bank also continues to pursue further liberalisation in the cross border provision of insurance in certain sectors, such as the Marine, Aviation and Goods in International Transit (MAT) sector, both to enhance capacity and reduce costs for businesses. This is primarily being advanced under regional integration plans, focusing in particular on ASEAN.
However, it is important to remember that for each successful investor earning high returns, there are many others with the same ambition and risk willingness, but with a record of poorer performance and bankruptcies. The Government Pension Fund cannot run the risk of ending up among the worst performers. The globalisation of financial markets provides the Fund with good opportunities for investing and diversifying risk. However, we cannot insulate the Fund from wide annual swings in the value of the investments. We invest in international equity markets where prices fluctuate widely. These fluctuations are the reason why equity investments generate a higher return over time. The best year in the Fund’s history so far was 2003, when it posted a real return of 11 per cent. This stood in sharp contrast to the previous year’s result, which was -6 per cent. Globalization and cyclical developments have been kind to the Norwegian economy. Few countries are benefiting as much as Norway – and losing as little – in the current environment of freer trade in goods and services and cross-border labour mobility. Economic developments and prospects Let me now turn to the current economic situation and the outlook for the years ahead. Economic growth in Norway has generally been strong over the past 15 years, although with some cyclical variations. A clear upturn in the years from 1993 to 1998 was followed by a period of more moderate growth and a mild downturn in 2002 and into 2003. Wage developments reflect and influence business cycles.

Figure 4 Inflation expectations for 2011 (1)  (annual change, percent)  8 7 6 5 4 3 2 1 0  Developed economies (2)  Latin America  Emerging Asia  Eastern Europe  (1) Average inflation of the year, with the exception of Latin America, which uses inflation at December 2011. (2) Geometric average for the U.S., the Eurozone and Japan. Source: Consensus Forecasts. BIS central bankers’ speeches  7  Figure 5 MPR in the world (1) (percent) 9 8 7 6 5 4 3 2 1 0  06  07  08  09  10  Developed economies (2) Emerging economies (3) Chile  11  9 8 7 6 5 4 3 2 1 0  Expected MPR (4) (percent)  5  5  4  4  3  3  2  2  1  1  0  0  08  09  10  11  U.S.A. Eurozone  12  Japan  (1) Simple average of reference rates for each group of countries. (2) Includes the U.S., Japan, the U.K. and the Eurozone. (3) Includes Brazil, Colombia, China, the Czech Rep., Hungary, Mexico, Peru, Poland, South Africa and South Korea. (4) Gray area indicates trajectory implicit in futures contracts. Dotted line shows market forecast at the statistical cutoff of December's Monetary Policy Report. Sources: Central bank of respective country and Bloomberg.
BIS central bankers’ speeches  7  I am an optimist, and I am convinced that our country has the right institutions to help us out of these challenging times. Over the years we have combined our efforts to make reforms, that are deep and long-lasting. Actually, our country is recognized around the world, precisely for its strong institutions. The capacity of our leaders to reach agreements is proof of such strength and, therefore, we have appreciated the agreement led by the Finance minister, Congress representatives and political leaders around the tax reform. The question we must ask ourselves, putting aside our individual positions, is how we can all move forward to create a better country. Naturally, discrepancies will arise about the reasons for the slowdown. We believe, however, that a fruitful use for our time is to think about ways to reactivate our economy and, more importantly, how to boost growth into the medium to long term. Beware also with being over-optimistic or over-pessimistic. When things go well we see no limit and indulge in the we-are-so-good fantasy. But when the table turns we become pessimistic and see no possible solution. It’s neither this nor that. The country we have built, though not perfect, is an example among emerging economies. There is a long way ahead, but let us not underestimate what we have achieved. Mistrust will not bring the solution. The only way is to work hand in hand, which is what has brought us so many good results as a society.

Table 2 Domestic scenario (annual change, percent) 2012  2013 (e) Report, Jun.14  Report, Sep.14  2014 (f) Report, Jun.14  Report, Mar.14  2015 (f) Report, Sep.14  Report, Sep.14  GDP  5.4  4.1  4.1  3.0-4.0  2.5-3.5  1.75-2.25  3.0-4.0  Domestic demand  6.9  3.4  3.4  3.3  1.7  0.1  3.4  Domestic demand (w/o inventory change)  7.1  4.2  4.2  3.3  2.4  1.0  3.2  12.2  0.4  0.4  0.8  -0.7  -4.1  1.8  Gross fixed capital formation Total consumption  5.6  5.4  5.4  4.1  3.4  2.6  3.6  Goods and services exports  1.1  4.3  4.3  3.2  3.2  2.4  3.8  Goods and services imports  5.0  2.2  2.2  2.4  -1.1  -3.9  4.0  Current account (% of GDP)  -3.4  -3.4  -3.4  -3.6  -2.5  -1.8  -2.2  Gross national saving (% of GDP)  21.7  20.5  20.5  19.5  19.9  19.8  19.7  December CPI  1.5  3.0  3.0  3.0  4.0  4.1  2.8  December CPIEFE  1.5  2.1  2.1  2.8  3.7  3.4  2.5  (e) Estimate. (f) Forecast. Sources: Central Bank of Chile and National Statistics Institute (INE). 14  BIS central bankers’ speeches