samchain/econo-pairs-v1 huggingface dataset:
16  All speeches are available online at www.bankofengland.co.uk/speeches  16  (b) Climbing the Jobs Ladder As the economy recovered after the crisis, so did aggregate jobs growth. In response, workers began to climb the jobs ladder, with transition rates between jobs rising. We would expect this to have then boosted aggregate pay and productivity, as workers rotated into higher-paying, more productive firms. In practice, this process appears to have been sluggish for pay and to have stalled for productivity. Why? There appear to have been two effects at play in slowing the rate of climb up the jobs ladder. First, although the rate of jobs transition picked up, it did so only slowly, especially given the degree of underlying strength in the jobs market. Despite picking up, the velocity of circulation in the labour market has remained relatively subdued in the face of the biggest jobs bonanza since the Second World War. Job-to-job transition rates have only just reached their pre-crisis levels after seven years (Chart 13). And that still leaves them around 25-30% below their peaks in the 1970s and 1980s. This relatively subdued pattern is even more striking if we compare transition rates with the degree of tightness in the labour market, defined by the V/U ratio (Chart 19). This suggests job-to-job transitions have not really picked-up at all over recent years, when measured relative to the strength of the jobs market.

The TUC estimate that as many as 1 in 9 workers may be in work which is insecure in income terms.7 This income insecurity has been a key and recurrent theme in my recent discussions with charities, faith and community groups across the UK. For some, these income insecurities have been worsened by the introduction of Universal Credit. This has added time lags in payments to claimants, caused rising concerns about benefits sanctioning and has heightened uncertainties about eligibility for work criteria.8 Recent research by the Resolution Foundation has found that pay volatility in fact affects a significant number of UK workers, not just those on low pay or the gig economy.9 Over 90% of those who remained with the same employer during 2016-17 experienced at least one month when their take-home pay varied by more than 5%. This pay volatility is more prevalent for those on lower earnings and among the young. Income volatility appears to have significant welfare costs for workers. A recent study found the average worker would be willing to sacrifice a fifth of their wage to avoid a variable work schedule set by their employer.10 In practice, gig workers tend to be paid less not more. Pay of self-employed and zero-hours contract workers lies significantly below employed and permanent contract counterparts (Chart 12). This is a malign coincidence of lower and less certain income.
Longer life expectancy – success story and challenge Ladies and gentlemen, the low interest rate environment is a challenging situation for pension funds. And I cannot even give you an idea of when Switzerland will be able to return to positive interest rates. All I can say is that the timing will greatly depend on developments in the global economy and the performance of the international financial markets. Another challenge that is sure to preoccupy you as pension fund managers is that of rising life expectancy – on the face of it a very gratifying development and, indeed, one of humanity’s success stories. Rising life expectancy is not only influencing the propensity to save but is also having a direct impact on the pension funds. Given an unchanged retirement age, it steadily lengthens the average duration of pension payments. This in turn results in higher payments and extra strain on the pension funds. The consequences of these developments are clear. Lower inflation and reduced real rates of interest are resulting in lower nominal interest rates and are thus diminishing the pension funds’ earnings prospects. On the benefits side, increased life expectancy means that pensions are being drawn for longer, thus increasing the volume of savings capital needed to finance these benefits. As a result, the system becomes unbalanced. Price stability – the SNB’s contribution to a healthy pension system What could be done to find a workable solution? Which measures would make sense and which would not?

This showed that the negative interest rate, and our willingness to intervene on the foreign exchange market as necessary, are still essential in order to ease pressure on the franc, thereby stabilising price developments and supporting economic activity. Only in this way can we fulfil our mandate – to ensure price stability while taking due account of economic developments – in the interests of the country as a whole. In September, we also adjusted the basis for calculating the exemption threshold, which defines the portion of a bank’s sight deposits at the SNB on which we do not charge negative interest. This adjustment reduces the overall burden imposed on the banking system by negative interest to the minimum required for monetary policy purposes, 6 while taking account of the possibility that the low interest rate environment may persist worldwide for some time to come. While negative interest rates are unusual and should only be temporary, moderately negative rates are not fundamentally different in terms of their economic effects from interest rates above zero. As the negative interest rate has brought about an easing of financing conditions in the economy, companies are able to take out loans for investments at lower cost. For us, however, this so-called ‘interest rate channel’ is not of prime importance. Rather, it is the effect on the exchange rate that is decisive for Switzerland as a small open economy. With the negative interest rate, we can ensure that the traditional interest rate differential versus other countries is not eroded excessively.
That will require the sound functioning of the credit channel, which is so important in the European economies and, of course, in Spain. … and immediately tackle structural problems and challenges Beyond the short-term reaction, it is time for economic policy to focus on tackling structural challenges. Allow me to summarise some of these, both at the national and European levels, including those relating to monetary policy and the banking sector. As regards national economic policy, one of the major challenges is undoubtedly to restore health to public finances. I have already pointed out that one of the most adverse consequences of this crisis will be the strong growth of public debt. And high public debt increases the economy’s vulnerability. Hence, the necessary counterpoint to the current fiscal activism is the announcement of a multi-year strategy to correct budgetary imbalances, to be implemented once the health crisis is behind us. The scale of the challenge is substantial. Even before the crisis the structural budget deficit exceeded 3% of GDP. We must now add to that figure the increase in the interest burden owing to the greater volume of debt. Also, there are expenditure increases derived from the introduction of the minimum living income and, in the case of pension spending, from population ageing pressure and the decision to link pensions to the CPI, along with the potential structural increase in certain expenditure items, such as healthcare.

These actions include the signing of a memorandum of understanding that further facilitates information sharing related to the Treasury market, and again co-hosting this conference. Going forward, the staff of the Joint Member Agencies will continue to work together on effective and comprehensive data collection, monitoring of market activity and liquidity through the Interagency Working Group, development of principles and best practices for Treasury market data transparency, and the regulatory framework for government securities. A main focus of recent work by the Joint Member Agencies has been to improve the availability of information to both the official sector and the public. Given this emphasis, it is worth spending a few moments discussing the benefits of obtaining timely and robust data on Treasury market transactions. Data are essential to understanding flash events and market liquidity. Attendees at this 1/3  BIS central bankers' speeches  conference are very familiar with the events of October 15, 2014, when the 10-year Treasury yield experienced a 37-basis-point trading range over the session. At that time, market participants struggled to identify what had caused that sharp movement. Similarly, a flash event occurred in the British pound just this month. The pound depreciated nearly 6 percent, and then largely retraced this move within several minutes, seemingly without a major catalyst. Once the domain of equity markets, flash events have happened with increasing frequency, also occurring in the dollar-yen and euro-dollar currency pairs in recent years. Treasury and foreign exchange markets share a number of common attributes.
Chile)  3.5  6.3  4.2  4.2  3.6  3.6  4.0  3.9  Commodity exporters  3.1  2.9  2.0  2.1  2.5  2.4  2.8  2.6  Trading partners  3.6  6.1  4.2  4.2  3.8  3.8  4.2  4.3  Terms of trade  8.1  23.8  -2.9  -  -6.7  -  -3.5  -  (levels) LME copper price BML $  -  342  401  -  350  -  340  -  Gasoline price $  -  598  804  -  784  -  748  -  (e) Estimate. (f) Forecast. (1) Assuming average economic growth for the rest of the world of 3.2% in the three-year period 2011-2013. (2) Assuming average economic growth for the rest of the world of 1.7% in the three-year period 2011-2013. Sources: Central Bank of Chile based on a sample of investment banks, Consensus Forecasts, the IMF and statistics bureaus of respective countries. Figure 1 Conditions of 90-day rates in CLP market(1) (2) (percent) 12  12  10  10  8  8  6  6  4  4  2  2  0  0 08  09  10  11  12  (1) Prime deposit rate. (2) Dotted vertical line marks date of CBC's REPOS purchase announcement. Source: Central Bank of Chile. 4  BIS central bankers’ speeches

It was free from personal judgement, for fear of calling into question the Bank’s judgement. It was free from emotion, for fear of questioning the Bank’s objectivity. And it was free from split infinitives, for fear of the wrath of the Bank’s wordsworths. This reign of semantic terror is, fortunately, now long gone. In its communications, the Bank no longer backs a single horse, notable for its consistency, lack of emotion and technical prowess. Instead it has invested in a diverse stable of styles and publications. The messages they deliver are now deliberately mixed, in tone and content, to meet the mixed needs of a mixed audience. Let me give three recent examples. The first is Bank Underground, the Bank’s staff blog. Bank Underground has levels of linguistic complexity up to 4 years lower than the Inflation Report, making it accessible to up to 11 million more people, or around a fifth of the adult population. Perhaps reflecting that, it recently exceeded 1 million hits. That is around 6 or 7 times the number of readers of the Inflation Report over the same period. 39 40 41  Haldane (2015). Acemoglu and Robinson (2012). See http://www.bankofengland.co.uk/research/Pages/conferences/2017/28290917.aspx 8  All speeches are available online at www.bankofengland.co.uk/speeches  8  A second is KnowledgeBank. This is an attempt to explain the economy and central bank policies using a combination of simple prose, cartoons, videos, games and competitions. It draws on different messaging conveyed through different media.
First, I’ll provide an in-a-nutshell summary of the structure of the Federal Reserve’s balance sheet. Then, I will discuss why it is important that the decline in the balance sheet be gradual and predictable, and explain how the FOMC’s plan provides this gradualism and predictability. I will then talk briefly about how the Federal Reserve is ensuring it is operationally prepared for unexpected developments. And then I’ll conclude on a slightly different note: I’ll offer my thoughts on why financial markets seem to have reacted much more calmly to balance sheet news this year than they did during the 2013 “taper tantrum” period. As always, these views are mine alone and do not necessarily reflect those of the New York Fed or the Federal Reserve System. The Fed’s balance sheet, in a nutshell Let’s begin by reviewing, at a high level, where the Fed’s balance sheet is today, and where it is likely to go in the coming years. Although many things about monetary policy are very complex, the basic structure of the balance sheet is actually fairly simple, as is the program of balance sheet normalization. Panel 1 shows a summary of the Fed’s assets and liabilities, as they are today. Substantially all of the $ trillion of assets consist of Treasuries and agency MBS. 3 On the other side of the balance sheet, the Federal Reserve has three main categories of liabilities: $ trillion of bank reserves and other deposits, $ trillion of paper currency, and about $ billion of reverse repos.

This will be an important piece of market infrastructure that helps demonstrate Hong Kong’s commitment not only to technological innovation but also to cross-border collaboration to promote more efficient trade and financial flows for the benefit of our businesses and peoples. UK and Others 6. I am also pleased to report that the HKMA has expanded and strengthened our ties with several other overseas authorities in the area of fintech collaboration in addition to Singapore. For example, we signed a Fintech Cooperation Agreement with the Financial Conduct Authority (FCA) of the UK in December last year. Later this morning, a colleague from Project Innovate of the UK FCA will share with us their experiences in fintech development. Moreover, the London-Hong Kong RMB Forum, which was first set up in 2012, has recently been expanded to become “London-Hong Kong Financial Services Forum” so as to cover wider areas such as fintech and the Belt and Road Initiative. This year’s annual meeting of the Forum will be held in Hong Kong in December, and is expected to be attended by high level government and private sector representatives from both sides to discuss a whole range of financial collaboration issues. 7. I should perhaps mention that we are also in active discussions with some other jurisdictions, including Switzerland, which share a common interest in mutual cooperation in promoting fintech. I hope to be able to report more news in the not too distant future. Guangdong-Hong Kong-Macao Bay Area 8.
The adequacy of European institutional arrangements for financial stability The adequacy of European institutional arrangements for financial stability has been reviewed in depth at the EU level. In two reports, in April 2000 and April 2001, the Economic and Financial Committee (EFC) took stock of the supervisory and regulatory mechanisms in the EU and examined the issue of financial crisis management. It concluded that the current arrangements provided a coherent and flexible basis for safeguarding financial stability and recommended a further strengthening of cross-border and cross-sector co-operation. I fully share the assessment put forward in these reports and I would like to stress here the special responsibilities of central banks, due to: their position at the heart of financial systems, their role as liquidity supplier to the economy, their close and constant contact with credit institutions, their contribution to banking supervision and to the safe and efficient functioning of payment systems, and at least for some of them, their contribution to the safe and efficient functioning of securities clearing and settlement systems. To sum up, an institutional framework in which the Eurosystem’s responsibilities for monetary policy in the euro area are coupled with extensive supervisory responsibilities of NCBs in domestic markets, and with reinforced co-operation at an area-wide level, seems appropriate to tackle the changes triggered by the current financial trends and the introduction of the euro.

However, if we scale it to the country’s GDP, it was in the range between 6.1 to 6.9% over the past five years. Thus, despite the headway we have made in advancing e-payments, the persistency of cash among the public and small and medium sized businesses remains high. This opens up the economy to risks as cash is still being used by criminals to launder illegal proceeds, as we 3/5  BIS central bankers' speeches  have seen from some high-profile cases over the past year or so. Similarly, this is the preferred mode to finance terrorist activities, which will involve transacting in cash. Therefore, it is timely for us to look at ways to strengthen the controls to mitigate financial crime; namely the cash threshold reporting requirement. When we compare Malaysia with other countries, our current threshold is too high and disconnected from the size of our economy, especially relative to our purchasing power. Hence, it needs to be updated. In this regard, we would like to announce that we will be lowering the daily cash threshold report to RM25,000 effective 1 January 2019. This will bring the cash threshold report in Malaysia to be more at par with other countries. We do not anticipate any impact in terms of economic activity but an increase in effectiveness in taming the black economy that is still heavily reliant on cash transactions.
As a catalyst for such innovations, I am pleased to announce that following a public consultation process, the Bank has today issued details of the Financial Technology Regulatory Sandbox. Effective immediately, financial institutions and fintech companies will now be able to pilot innovations in a controlled, live-test environment with appropriate flexibilities accorded. This will include flexibilities under existing regulatory requirements that apply to outsourcing arrangements and access to customer information, subject to compensating safeguards. The experience from the sandbox will provide input into formulating more proportionate regulations that will spur the orderly growth of new innovations in the financial industry, including insurance. We see significant potential for positive disruptions to transform the business of insurance and takaful in Malaysia – from the way insurance is consumed, to opportunities for addressing leakages to drive insurance costs lower. Indeed, the greatest gains from technological innovations may well be reaped in the more mundane aspects of running a business efficiently. Today, money is still being left on the table from inefficiencies and leakages in the insurance system. From inefficient manual  2  BIS central bankers’ speeches  processes to the slow take-up of electronic payments, there are large gaps in the supply chain that unduly increase the cost of insurance and limit efforts to combat insurance fraud. The insurance industry needs to accelerate its pace in terms of its technological adoption or else events will dictate the shape of the industry’s future.

And, we must continue to devote sufficient attention and resources to complete the efforts. At the same time, though, it is important to take stock of the changes made over the past few years – for two important reasons: first, to assess the impact of those changes, both intended and unintended; and, second, to understand the contours of the “new” financial system operating under the range of new rules and regulations, both national and global in nature. Such a stocktaking is important to  BIS central bankers’ speeches  1  ensure that we collectively understand how the “new” financial system is operating. Firms and supervisors will continue to face challenges and competing demands as we press, in the months and years ahead, on implementing necessary changes and assessing the “new” financial system. What the future holds One of the topics that I feel will compete for, and will deserve, a lot of attention in the foreseeable future is cybersecurity. I am often asked about my list of “things that keep me awake at night,” and I think it’s fair to say that cybersecurity is at the top of that list – as I’m sure it is for many of you in this room. In fact, I think cybersecurity is one of the topics that should be on everyone’s list – from the most senior managers and boards of directors, all the way down to line managers.
This at a time when Malta has already started to graduate from the General System of Preferences (GSP) through which some developed countries grant non-reciprocal preferential trade access to less developing countries. For example, Malta graduated from the GSP scheme of the USA at the end of last year. In addition, pressures are mounting on developed countries in the WTO to extend any preferential treatment accorded to a subset of WTO members to all other members, such that any preferential treatment given to Malta by any country over and above that accorded to other WTO members will be lost in any case. In a non-membership scenario, moreover, the EU-Malta income gap would tend to widen because the other new members will continue with reforms that are conducive to attracting FDI. Indeed a recent study shows that the EU decision to open negotiations with the first-wave of accession countries had by itself reinforced FDI flows into these countries. This has implications for the catching-up process, because countries that absorb the highest amounts of FDI normally continue to attract the bulk of new 14 investment in later years. So that if the scale of FDI flows into Malta fails to keep up with that going to the other candidate countries, Malta could easily fall behind these countries in terms of GDP growth and living standards.

If this agreement is to be upgraded, however, Malta would have to make commitments over and above those it has today. Indeed, many of the countries with whom the EU has a comparable agreement have managed to obtain a better deal than Malta not only because they are much larger in terms of market size, but also because they have entered into additional commitments. EEA countries, for example, do indeed participate in EU programmes, but they have also offered substantial rebates on loan-related interest payments and committed nearly ECU 500 million in direct grants for projects in specific EU regions. In other words, EEA countries contributed to the EU’s financial resources, and specifically to the EU’s regional policy, without being members of the EU. In addition, it is well known that membership of the EEA implies taking on a large part of the EU acquis, whether past, present or future, without having any say in the decision-making process. Nor is the obligation to come into line with the acquis unique to the EEA. As is the case with Switzerland, which is an EFTA but not an EEA country, the EU’s trading partners are increasingly being required to approximate their national laws with those of the EU as a precondition for access to 13 its market .