samchain/econo-pairs-v1 huggingface dataset:
As many of you know, it was my privilege five years ago to participate in the creation of the Single Supervisory Mechanism (SSM), which is one of the linchpins – though admittedly not the only one – of this Banking Union. This experience was truly a privilege, because only rarely can one participate in the creation of a new body from the very outset. The SSM is made up of people from the 28 countries of the Union (not only the 19 euro area members), each with its own culture, language and particular focus on supervisory work. As you can imagine, the task of achieving a single supervisory framework is not straightforward when the starting point involves such diverse standpoints. Adopting a new culture and new supervisory practices means renouncing methods we considered our own, accepting that other methodological approaches may be more appropriate. That is no easy feat. Despite these difficulties, I believe that over the past five years we have managed to bring about genuinely European supervision. While work remains to be done, in my view the result to date is very positive. In the debate that follows we can perhaps delve into what, so far, the SSM has meant for our work as supervisors and for the functioning of the European banking sector. But, as the title of this address states, I seek to go beyond the SSM and talk about the European Banking project.

At the Brisbane summit in 2014, the G20 leaders agreed an ambitious goal to lift the level of G20 GDP by at least two per cent by 2018. But only eighteen months on, the 2 in 5 commitments are starting to look more like the 5/2 diet. Less than half of the measures have been implemented, and only around one third of the promised impact on global GDP has been delivered. Moreover, whilst implementation has lagged, the need to boost growth has increased in size and urgency. The Bank of England projects the level of global GDP in 2018 to be over 3% below what the IMF expected at the time of the Brisbane summit. We need to live up to China’s G20 priorities. Structural reforms with a long-term focus but a short-term implementation horizon. Determined reform of the global architecture for sustainable capital flows. The development of our essential macroprudential frameworks and the implementation of our financial reform commitments to address new vulnerabilities. These will allow monetary policies to fully bridge to a better future. Conclusion That future needs the arms of macro policy to operate in close concert, domestically and internationally. Demand stimulus alone will not sustainably reflate the global economy. Moreover, sustained low rates could strain the capacities of macroprudential policies. At their roots, fiscal, monetary, financial and structural policies are deeply complementary, operating through many of the same channels. A stronger financial system can better channel savings to investment, building demand in the short run and productivity in the long run.
Today we will summarise our intermediate results and progress we have made so far. From the beginning of 2016 to March of this year, outstanding foreign currency loans went down by almost $ billion. This was partly offset by an increase in outstanding ruble loans, which grew to 514 billion rubles. We can also see a decrease in foreign currency lending, mainly in those industries where companies lack so-called natural hedging. Once again this refers to businesses in the construction and real estate industries, as well as wholesale and retail trade. For exporter companies the situation remains unchanged, and banks continue to make foreign currency loans to them. In 2014–2015, exporters’ external debt presented a significant potential risk to financial stability. The high number of maturing loans was a cause for concern, and we were carefully monitoring the schedule for upcoming repayments. This spike in external debt repayments has since passed. In the first quarter of 2017, the 27 largest companies repaid a combined total of $ 3/6  BIS central bankers' speeches  billion in external debt. They will repay a further $ billion by the end of 2017 (April – December), which is 22% less than the payments made in the same period of the previous year $ billion). Now, given the recovery in economic activity in the world and in Russia, as well as the increase in attractiveness of Russian borrowers, there is the potential risk that these borrowers will accumulate excess foreign currency debt.

The Governor of the Bank of England, Mark Carney, has claimed during a hearing in the House of Lords that during long-term positive supply shocks there may be reason to adjust the inflation target downwards, but he emphasised that this was currently only hypothetical reasoning, see House of Lords (2015). The Bank of Canada investigated in 2011 whether the inflation target should be lowered, partly from the view that the problems with incomplete indexing of nominal contracts could decline further, see Côté (2014). However, this was dismissed on the grounds that the problems linked to the policy rate reaching its lower bound more often would be too severe. 11  For a more detailed review of the effects of digitisation on inflation, see the article “Digitisation and inflation” in Monetary Policy Report, February 2015. 12  Digitisation-related products have contributed for a long time to keeping down CPI inflation, but the effect has been relatively smaller in recent years than before. 4  BIS central bankers’ speeches  Another channel has an impact via the Internet and the matching and interplay between producers and consumers. Increased competition via e-commerce and greater opportunities for consumers to compare products make it more difficult for companies to raise their prices. A third possible channel is linked to new technology being used to replace labour. Although there have been fears that “technology will take away jobs” ever since the industrial revolution in the 18th century, they have not been realised.
Such factors might be compounded by other differences between the corporate and sovereign frameworks, including the lack of collateral (or the means to acquire it) underlying sovereign debt, and the greater uncertainties in the sovereign case on issues such as creditor seniority, assessing ongoing debt sustainability and burden sharing. This latter point also raises the thorny issue of Paris Club comparability, which could be regarded as imposing a form of involuntary PSI on the private creditors. The sovereign case will also generally be subject to political factors that are simply not present in the corporate case. The uncertainties surrounding these questions explain why progress has been slow in devising a framework governing sovereign workouts that is capable of commanding widespread support. I believe there is great scope in developing such a framework to draw heavily on the principles governing corporate and financial sector restructurings, where they are relevant, without compromising the distinct features of sovereign workouts. I am pleased to see that this seems to be the approach being taken by the various private sector groups, and I wish them well in their efforts. Conclusion Let me try to bring my remarks to some conclusion. In a financial system that has become ever more global and inter-connected, central banking increasingly involves spotting linkages between developments in different countries, sectors or markets. Usually this is a matter of identifying and dealing with threats before they emerge. But there is also an opportunity to take ideas developed to address one set of problems and apply them elsewhere.

Like all happy marriages, the bonding should foster growth and help the partners to realise their potential during good times; and provide an anchor to help them to face the challenges of the bad times with resilience and confidence. 7. Both partners have certainly done well during the good times in the past decade. (i)  HK’s developments  8. During this period, Hong Kong has continued to consolidate its role as a premier international financial centre and has become a more globalised economy: –  The total assets of the banking system have increased 2.7 times to $ trillion, with foreign currency assets accounting for about 60% of the pool. –  The market capitalization of the Hong Kong Stock Exchange has become more than 4 times bigger, advancing from number 8 to number 6 in the global ladder. –  The bond market has also increased by about 3 times, with foreign currency denominated bonds accounting for about 40% for most of the time. 9. Hong Kong has also become a hub for private wealth and asset management. Nearly 80 of the top 100 global money managers are in Hong Kong. The total assets under management hit a record high of $ trillion in 2013, with 72% of the funds sourced from  1  Mr David Puth, CEO of CLS Group Holdings, and CLS Bank International. BIS central bankers’ speeches  1  non-Hong Kong investors.
I maintain that. WSJ: What do you think the risk is that this wrenching process will cause the breakup of the euro or its membership? TRICHET: Of course the euro is there and will be there in the future. I do not comment on what I consider absurd hypotheses. I am used to such questions from the very beginning of the euro. The paradox is that, years ago, the question was about Germany supposed to be at that time the “sick man of Europe”. I was responding that Germany was doing hard work that its economy was catching up on competitiveness. Now the same hard work has to be done by those that were growing rapidly over the past years but at the same time had lost their competitiveness. One has to accept that within a vast economy that has the size of the euro area, with 331 million people, there are economic differences. For instance when I look on both sides of the Atlantic I see that the differences between the fastest and slowest-growing U.S. states, it is more or less of the same order of magnitude as between countries in the euro area, for instance between Oklahoma and Nevada, 13 % differences in growth in 2009; between Slovakia and Ireland more than 9 % in growth in 2008. WSJ: The U.S. copes with these differences through labor mobility and a federal budget. Does the euro zone ultimately need a big federal budget?

However, a key challenge observed was that workers became siloed in their various specialties, thus impeding collective innovation goals. Michael Tushman, a Harvard Business School professor known for his work on organisation design, was an early researcher into efforts to overcome this challenge. From there, he coined the term 'boundary spanners' 3 – individual connectors with the ability to bridge information from different verticals of an organisation to unlock innovation value. Since 1958, the boundary spanning role has been popular throughout academic research into innovation systems. With hindsight, we know that period ended up as the golden age of capitalism, marked by greater organisational efficiency, specialised production and trade expansion. It is intriguing to find insurance at a similar crossroad today. Consumer activity is becoming entrenched in digital ecosystems. Critical sources of information which were previously unconnected are becoming more connected. This has the potential to not only deepen protection, but also mitigate long-held issues in insurance like moral hazard and adverse selection. 1/6  BIS - Central bankers' speeches  While the pandemic presented numerous challenges, it underscored the value of financial security in times of stress. This has generated greater consumer and business appreciation for protection solutions. Like the past, there are immense opportunities emerging across ecosystem verticals, merely awaiting a connecting agent to unlock them. I believe the insurance and takaful industry is uniquely positioned to act as boundary spanners that can pave the direction for innovation, break down traditional barriers, and influence positive consumer behaviours.
As many of you are aware, the Federal Reserve Bank of New York published a white paper in May 2010 that highlighted three critical sources of instability associated with practices in the tri-party repo market: (1) the market’s excessive reliance on intraday credit from the clearing banks; (2) weaknesses in the liquidity and credit risk management practices of cash lenders and clearing banks that left them vulnerable to stress environments; and (3) the lack of a mechanism or process for liquidating collateral during periods of stress in a manner that did not destabilize other segments of the financial system. After the crisis, we asked the industry to help develop a plan to reengineer the tri-party repo settlement infrastructure to mitigate these risks. The industry responded by identifying key changes that could be made to the platform to eliminate market reliance on intraday credit, thereby removing a key source of fragility observed in 2008. This process was challenging at times, and ultimately required our intervention as a supervisor to move forward. But the industry successfully developed a roadmap for reform that is the basis for the changes now being implemented. The clearing banks are making substantial investments to reengineer  BIS central bankers’ speeches  1  their tri-party repo settlement processes, while lenders and borrowers are making adjustments to their business practices and technologies to ensure they are ready for changes that are occurring in the market.

Given  4  BIS Review 96/2006  the analysis and forecasting tools we use today, it is difficult to say whether a sudden correction in house prices will occur, or whether we can count on a calmer and more prolonged adjustment. At the same time, the Riksbank must take into account the risks when conducting its monetary policy. If house prices and household indebtedness increase rapidly over a long period of time, there is a risk of imbalances building up. These imbalances may force an adjustment further ahead and in the worst case may have severe consequences for the real economy and inflation. If house prices rebound, this could lead to subdued demand further ahead through both a decline in household consumption and reduced investment in construction. This type of development could in the longer term lead to both inflation being below target and to weaker growth in the economy. It is difficult to manage this type of risk. One possibility is to make changes in the interest rate slightly sooner or later than would otherwise be justified on the sole basis of the forecasts for inflation and the real economy. It is hoped that such a policy will contribute to a smoother adjustment process and help to avoid a more abrupt correction. A two-year horizon is a good decision rule, but it cannot always work in all situations. There are now signs of some slowdown in the housing market.
In the first stage, the markets had difficulty perceiving the dimension of the damage caused by the crisis and considered that such an incident would be overcome shortly and/or would not reach significant levels. As a matter of fact, especially in the first half of 2008, one of the most discussed items on the agenda of international financial circles was whether there would be a decoupling of economies or not. In that period, many economists and market specialists supported the idea that the crisis that emerged in advanced economies would have a limited impact on emerging economies and that emerging economies had the capacity of compensating the global demand deficit, which was to be observed. In conclusion, they claimed that there would be a distinct decoupling in the growth dynamics of country groups. It has been fortunate that the expected decoupling has not been as intense as estimated. It is inevitable for both developed and emerging economies to be affected by global economic turbulence in a period characterized by the progressively rising interdependent nature of global economies. However, the scale of the impact has differed from one country to another. When we look back, we see that the resilience of countries in the face of the crisis has been determined mainly by four structural factors. It is possible to examine them under four headings as (1) Floating exchange rate regime (2) Resilience of the banking system (3) Countercyclical monetary policy and (4) Room for maneuver provided by the fiscal discipline implemented in the pre-crisis period.

To address current structural and cyclical challenges we need to rely on the analysis and advice of well-trained economists whether they are in the academia, in the public administration, central banks or the private sector. This is why it is so important to have academic institutions like CEMFI, that produce groundbreaking research and invest heavily in boosting the single most important determinant of economic growth: human capital. Students of the class of 2022, what you take from here – your knowledge and the tools needed to analyse and understand reality – is the accumulated capital stemming from what is probably the most important investment you will make in your whole life. You have invested your time and effort. And the yield on this investment will be a wide array of opportunities. But, above all, this human capital you now possess is something that nobody can take away from you. It will accompany you everywhere you go and you can apply it in every endeavour you may undertake. Besides the Master and PhD programmes, organised in collaboration with the Universidad Internacional Menéndez Pelayo, the CEMFI provides other valuable services, such as a summer school that brings leading academics to teach courses in relevant areas to participants – among them a large number of central bankers – and a highly valued summer internship programme for top undergraduate students. And it also collaborates with the Banco de España in various research activities, including the organisation of workshops and international conferences.
For some time now the Central Bank has been preparing for these reforms, among other things by strengthening the instruments at its disposal. Current legislation on the Central Bank assumes that exchange rate policy decisions are the joint task of the Government and the Bank. Talks about this issue have been in progress for some time between the parties involved. A conclusion has now been reached, as the Prime Minister announced in his preceding address. The Central Bank welcomes the exchange rate policy reform decision and is convinced that it will strengthen the foundation of Iceland's economy. It is vital to bear in mind that the exchange rate has a strong impact on prices in an open economy. For this reason, monetary policy will need to take exchange rate developments into account. I would like to draw particular attention to the statement in the joint announcement by the Government and Central Bank that despite the elimination of the fluctuation limits for the króna, the Central Bank will intervene in the foreign exchange market in order to promote the inflation objective, if it thinks that exchange rate fluctuations might undermine financial stability. In the past few days some unease has developed in the foreign exchange market and the króna has slid somewhat. There is little doubt that this unease is linked to uncertainties about the exchange rate framework reform and widespread discussion about the conceivable adoption of inflation targeting.

Jean-Pierre Roth: Once a student, always a student Summary of a speech by Mr Jean-Pierre Roth, Chairman of the Governing Board of the Swiss National Bank, at the University of Bern, Switzerland, 9 February 2006. The complete speech can be found in German on the Swiss National Bank’s website (www.snb.ch). *  *  *  Like all decisions relating to the future, monetary policy decisions involve numerous uncertainties. Economic researchers are divided as regards both the effects of monetary policy and the form that this policy should take. There are a number of competing models in economic theory, and their policy recommendations often vary. Relationships that have been stable in the past may change at any time, due to the fact that the structural equations used in economic models are not based on the laws of nature. The Swiss National Bank's monetary policy concept takes account of these uncertainties. Our inflation forecast is a key element in this concept and combines the results obtained by a variety of different models. Research is extremely important in our changing world. We can only be sure of identifying new developments as early as possible and basing our monetary policy decisions on a solid foundation if we engage in constant research. BIS Review 9/2006  1
On Tuesday I spoke about the role central banks have to play on climate change and that, far from representing an entirely new objective, the Bank of England’s work in this space sits firmly within the bounds of our mission to maintain monetary and financial stability.1 We have an important role to play, but it is governments, businesses, investors, and individuals that have the most difficult and impactful decisions to make in driving the transition to a net-zero economy. Today I want to build on those remarks to reflect on central banks’ climate-related work to date and to consider how it will need to evolve if we are going to continue to meet our remit. I will address this by talking about three main areas of our work: firstly, improving the understanding of climate-related financial risks across the financial system and macroeconomy; secondly, developing and embedding climate risk management in the financial firms that we regulate; and finally, seeking to achieve best practice through our operations as a central bank. I will begin with our work to understand climate risks across the broader financial system and the macroeconomy. The Network for Greening the Financial System (NGFS) has continued its pioneering work in this space, through the publication of climate scenarios that provide a common starting point for analysing risks to the system2, and the latest version of these scenarios is due to be published soon.

The first is to familiarize yourself with this new environment – to get to know new colleagues, to learn about the culture of the workplace, and basically to settle in. Some may find this phase more challenging than others, especially if they were easily shaken by cultural shocks. Once you have settled in the new place, you may discover certain shortcomings of yours are constraining your career advances. These shortcomings may already be existing, but are only exposed by the new job. Fixing these shortfalls is the second step in the transition. Finally, to make a significant progress in the career, you will have to set the bar for yourself, and strive to reach it through learning and development. This will require insights to identify one’s strengths, and skills to take advantage of them given the dynamics of the working environment. The stages of economic development may be thought of in a similar vein, consisting of three pillars. The first pillar is to ensure that the economy ‘settles in’ the new global environment smoothly, and remains resilient against new types of shocks. The second pillar is to identify and fix structural shortfalls that may have hindered economic development in the past, and could become even more binding in the future. The last pillar is to lay out a clearer long-term plan for strengthening and developing the economy, leveraging on its strength and the opportunities presented by the evolving landscape.