samchain/econo-pairs-v1 huggingface dataset:
The other Nordic countries – Denmark, Finland and Sweden – are comparable in size and structures, but are mainly non-oil economies. 3 Three indicators may be relevant in this context. First, there is no evidence that our productivity growth has been eroded. In fact, Norway has generally managed to sustain high productivity growth compared with most other advanced countries. Second, there is no evidence that labour force participation has been impaired. In fact, labour force participation is now high, after having lagged behind our neighbouring countries up to the mid-1980s. A third indicator is welfare spending. Here, there is evidence that developments have been less favourable. Norway has seen a sharp increase in sickness absence and a steadily higher share of the working-age population is on disability benefit or rehabilitation schemes. Over the past decade, Norway has underperformed on this score compared with the other  1  The expression ”Dutch disease” originates from the Netherlands, where the government rapidly spent large revenues from extraction of gas in the 1960s. 2  The economic literature includes many studies that look at the relationship between income from natural resources and economic growth, see for example Jeffrey D. Sachs and Andrew M. Warner, “The curse of Natural Resources”, European Economic Review 45 (2001) and Thorvaldur Gylfason, “Natural Resources and Economic Growth: From Dependence to Diversification”, Discussion paper No. 4804, CEPR. 3  Denmark has also been producing oil and gas since the early 1970s, but on a smaller scale than Norway.

I caution that even a complete rehabilitation of the euro area’s banking system (which is well on its way thanks to the various policy steps related to the Banking Union) will not guarantee a quick return to high growth and low unemployment. In fact, there are a number of challenges, both immediate and particularly medium-term ones, that the euro area economy is facing and which are potentially more difficult to overcome than repairing the banking sector. Let me name a few: in spite of the confirmed ongoing economic recovery, investment is still 20% below its 2007 level; there is a general weakness of demand and medium-term challenges to introduce structural reforms necessary  6  Vítor Constâncio “Banking Union: meaning implications for the future of banking” speech at Banking Union Conference organised by Master in Banking and Financial Regulation, Navarra University, Madrid, 25 of April 2014. 7  Vitor Constâncio “Growing out of the crisis: is fixing finance enough?” speech at the Levy Institute Hyman Minsky Conference on The state of the US and the World economy, Washington DC, 10 April 2014 (see ECB site). 8  “Basel III Capital: A Well-Intended Illusion”, remarks by FDIC Vice-Chairman Thomas M. Hoenig to the International Association of Deposit Insurers, 2013 Research Conference in Basel, Switzerland. BIS central bankers’ speeches  3  for a quantum leap in total factor productivity are compounded by negative demographic developments. In fact, in the near future, the European workforce will start declining by 0.6% a year until 2030.
The inflation target is the overriding objective of monetary policy. As before, the new act states that price stability is the primary objective of the Riksbank. It is now also stated more clearly that price stability means sustained low and stable inflation. In concrete terms, the inflation target is the same as before, that is, a target of 2 per cent for inflation measured as the annual change in the CPI with a fixed interest rate, the CPIF. If the Riksbank wishes to change the specification of the target at some point in the future, the Riksdag must approve the new specification before it can take effect. The Riksbank shall conduct monetary policy in an independent manner to attain the inflation target – this is a decisive factor for maintaining confidence in the target. However, this independence does not, of course, prevent us from discussing issues relevant to monetary policy with the Riksdag and the Government, as well as other authorities and organisations – as indeed we should, in my opinion. The Riksbank also takes into account the real economy. According to the new Sveriges Riksbank Act, the Riksbank shall also take into account the development of the real economy. Previously, the Riksdag assumed that the Riksbank would take the real economy into account, but this was not explicitly stated in the text of the Act. The new Act states that the Riksbank, without neglecting the inflation target, shall contribute to a balanced development of production and employment.

Recruitment plans in the business sector point to continued new recruitment, although there are some differences between sectors. The difference between different sectors is also shown in the Riksbank's Business Survey in February. In general, the companies interviewed believe that economic activity has weakened since last autumn. But several point out that the situation is not as bad as they had feared. Respondents in the manufacturing industry are much more satisfied with the situation than in the trade and construction industries. Orders in the manufacturing industry have increased overall and expectations are that they will remain at the same levels in the coming months. We have also received a new outcome for Statistics Sweden's GDP indicator, which provides an early picture of the development of GDP at the beginning of 2023. It shows that activity in the Swedish economy rose in January and both exports of goods and household consumption increased. Of course, one should not rely too heavily on indicators for individual months. And there is no doubt that GDP growth and the labour market will be weaker in 2023, partly as a result of the tighter monetary policy. But I still think it is worth emphasising that so far the situation in the Swedish economy is not pitch black. Low inflation a condition for good economic performance To conclude – we have our next monetary policy meeting in one month's time. By then, we will have received more information on economic developments, including the outcome for inflation in March.
“And it builds on an established monetary policy doctrine that has gained prominence not least through its successful adherence by the Bundesbank for several decades”, Mr Draghi says. “Namely that the central bank should be endowed with a clear price stability mandate and, within this mandate, should be allowed – in fact obliged – to use its instruments in full independence to deliver price stability.” *** Ladies and Gentlemen, It is a great pleasure to speak to you tonight. When I last spoke at an event organised by the Bundesbank, in March 2012, the euro area stood at a crossroads. One direction pointed to continued malaise, with various vulnerabilities threatening to undo the benefits of economic, financial and even monetary integration. The other direction pointed to gradual repair, with ambitious reform efforts removing the key obstacles to economic stability and growth. The euro area has chosen the latter path. And today, we are seeing first signs that this decision is paying off. At the same time, challenges remain and continued reform efforts are needed to ensure that the recovery proves sustainable. Against this background, let me first elaborate on what I think are the key milestones achieved so far and then address what are the key challenges for the ECB in the coming months. What have we achieved so far? The euro area reform agenda has consisted of two pillars. One is to restore fiscal sustainability and economic competitiveness at country level.

Ultimately, the common theme in all our efforts is to further the aims of the European Union. These are to promote peace, its values and the well-being of its peoples. As the recent events in Ukraine demonstrate, these aims remain as attractive and compelling as ever. Thank you for your attention. BIS central bankers’ speeches  5
While it is still premature to draw firm conclusions, based on the experience in Latin America and early indications from Asia, I believe that, on the whole, policy responses have been meaningful and have  BIS Review 64/1998  -4-  strengthened domestic safety and soundness considerably. Let me briefly review the new, post-crisis, financial landscape in Latin America. Crises have left perhaps their greatest imprint on domestic financial system structure. Financial systems have generally experienced significant consolidation - leading to a less fragmented banking market - as weaker and more marginal players have been forced to exit. Foreign capital now accounts for a noteworthy share of banking assets across a number of countries, bringing additional financial strength and know-how. Many governments have sought to reduce their direct role in the financial system through the privatization of state banks, although this will likely remain a longerterm policy objective for many countries. Authorities also have made tremendous strides in improving system infrastructure. Disclosure standards have been greatly improved, and in some Latin American countries, disclosure standards are now comparable to that of G-10 countries. Recognizing the greater historical volatility in emerging market economies, minimum capital requirements have also been raised to levels above Basle minima, and now incorporate additional sources of risk, such as market risk. Financial supervision and regulation has been improved, with additional resources dedicated to the hiring and training of examinations staff and to investments by regulators in information technology.

And the global nature of the economic downturn further highlighted the need for a rebalancing of trade flows between countries with large current account surpluses and deficits. Both adjustments are likely to occur only gradually and each has the potential to derail the recovery. I want to spend a little time today considering a third factor that will shape the recovery: the extent to which households need to rebuild their balance sheets following the big increase in household debt. Spend, spend, spend? Much has been said about the increase in household debt, both in terms of its role in the build up to the financial crisis and the extent to which it may dampen the recovery. The theme of much of this comment is that our current economic difficulties are a payback for past excesses. Households, it is said, were seduced by easy credit and rising asset prices, leading to a debt fuelled spending boom. As a result, we now face a period of retrenchment as we make amends for our former spendthrift ways. Like much conventional wisdom, these views contain a kernel of truth. But their repetition has led to exaggeration and distortion. Separating fact from fiction is vital when forming a view on the economic outlook. Consumer spending accounts for two-thirds of total demand in our economy; decisions made by consumers up and down the country will be critical in determining the strength and sustainability of the recovery.
Before 1995, the correlation between GDP and oil prices was –0.4. During the period 1995 to 2004, the correlation stands at +0.3 (see Figure 3). Against this backdrop, economic developments in China play a crucial role. The integration of China into the world economy is likely to be a historic event. Indeed, its long-term economic consequences strike me as comparable to those associated with the integration of the emerging U.S. economy into the world economy at the end of the 19th century. China has become the second largest importer and consumer of oil behind the United States. The longer-term oil demand effect associated with Chinese growth is potentially vast. The fact that China is poor in natural resources undoubtedly strengthens the Chinese authorities’ resolve to avoid any potential energy shortages. The International Energy Agency IEA estimates that global demand for oil will increase by 2.5 million barrels per day or in excess of 3% this year. This represents the highest increase in global demand for oil during the past quarter of a century. Virtually half of that increase in demand can be attributed to the Asian emerging markets with China accounting for over 32% of the additional demand. Needless to say, China is merely at the beginning of its growth dynamic.

Mugur Isărescu: Romania, the EU and the euro area Opening speech by Mr Mugur Isărescu, Governor of the National Bank of Romania, at the "The Future of the Euro Area and its Enlargement" Conference, Bucharest, 17 October 2017. * * * Professor Sapir, Ladies and gentlemen, The National Bank of Romania’s Board and I are honored to extend a warm welcome to all of our distinguished guests attending the conference this morning. Allow me to wholeheartedly welcome our speaker, Professor André Sapir. It has become quite a tradition here, at the National Bank of Romania to invite well-renowned lecturers to address the audience on important topics of the day. This morning, we are privileged to listen to Prof. Sapir’s lecture on The Future of the Euro Area and its Enlargement. Please, allow me to briefly introduce to you Prof. André Sapir. He is a well-known name among European economists. He is an active member and Senior Fellow of Bruegel Institute in Brussels. Prof. Sapir has a rich academic career and important contributions in the field and study of economics. I wish to express my appreciation for his diligent work dedicated to the strengthening of the conceptual underpinnings of the European Union and the Euro Area’s economic and financial systems. For those of you who are not familiar with Bruegel Institute in Brussels let me pinpoint a few facts. Bruegel was set up in 2005 and has emerged as an important independent and non-doctrinal European think tank focused on economics.
The growth of domestic demand is likely to be held back by the relatively tight fiscal policy as well as by the monetary policy tightening since May; and the effect this year of “windfalls” as a result of building societies’ demutualisations will be very much smaller. And we expect a deterioration in our net external trade position as a result of the strength of sterling’s exchange rate and now, too, as a result of the recent developments in Asia. The difficult questions for policy relate to the timing and the extent of the slowdown that is necessary on the one hand and likely on the other. These are difficult judgements at any time. They are particularly difficult when the economy is already close to full capacity. It is not surprising BIS Review 3/1998  -3-  that commentators differ in degree in their assessments. Economics is not - as I say - a precise science. Neither we at the Bank nor anyone else know with any great precision exactly where we are in relation to full capacity or exactly how fast capacity is growing; and we don’t know precisely either how demand will in fact respond to the policy tightening that is already in place. Our own best - and very carefully informed - guess is embodied in the forecasts that we publish each quarter, and we monitor immensely carefully the new information that becomes available day by day in the light of that forecast for early warning signs of emerging imbalance.

The return on the two asset classes is repre− sented by the fund’s benchmark indexes, measured in foreign currency, for the period June 2011 to May 2012. Sources: Statistics Norway and Norges Bank  Today, the fund is far larger than in 2011. As a result, return variations will have a greater impact. With the current size and composition of the fund, the same return as in 2011 would have resulted in a loss of almost NOK 1 000 billion, or close to 35 percent of mainland GDP. The fund has become important for the Norwegian economy. The fiscal rule links fiscal policy to the value of the fund. This year, 15 percent of general government spending is projected to be financed by transfers from the fund. Looking ahead, movements in global capital markets will be the main source of variation in the value of the fund, and at times in a negative direction. The actual stance of fiscal policy must allow for this uncertainty. The fund had several good years following the euro crisis. Markets turned around, and quickly the loss was more than reversed. We cannot take for granted that this will always be the case. Conclusion Let me conclude. The global economy finally appears to have fully recovered from the prolonged weakness that followed the financial crisis. Growth has also strengthened in Norway after the decline following the oil price collapse. The government’s solid financial position has been of considerable help.
As a consequence the prices are apt to drop sharply with changing perceptions of the underlying default rates, a feature that has been apparent during the crisis. A typical CDO comprises a large number and variety of RMBS, including a mix of prime and sub-prime mortgages from a variety of originators. On the face of it, this might seem like a good thing as it creates diversification. However, even more than with plain vanilla RMBS, it becomes impossible to monitor the evolution of the underlying risks – it is akin to trying to unpick the ingredients of a sausage. That may not matter too much when defaults are low and only the holders of the first, equity, tranche suffer any losses. Holders of the safer tranches can in that case sit back and relax – a case of rational inattention. But once defaults begin to rise materially, it matters a lot what such a security contains. And with highly nonlinear payoffs, returns can be extremely sensitive to small changes in underlying conditions. When defaults on some US sub-prime mortgages originated in 2006 and 2007 started turning out much higher than expected, there was a realisation that losses could be much greater on some of these securities than previously believed. And a growing realisation of the informational complexity of these securities made them difficult to price in an objective sense.

Even where we manage to limit the rise in global mean temperatures to 1.5 degrees, physical risks are likely to dominate the potential impacts of transition. And if instead we continue on our current trajectory, losses just from the impact on productivity could be as high as 13% of GDP.8  In addition, many of the leading studies, including those we used in the NGFS, start from past correlations and so find it hard to put an accurate number on the type of low-probability, high impact events that will become more common. As high levels of warming will be unprecedented, we don’t yet fully understand the delicate balance between the climate, living conditions, ecosystems and the economy - for example, the level at which ice melts might accelerate; or methane stores under permafrost might be unlocked. What is clear is that investment is needed now to help adapt to these inevitable changes. And that we should recognise the gaps in our understanding of how large changes to our climate might affect our economies. Challenges in applying scenarios  While these key themes are clear, I know from our own experience, and from the firms we supervise, that applying the scenarios in practice is not straightforward. The models, data and analytical frameworks are new, and the transmission channels are complex and subject to much uncertainty. The results can be sensitive to input assumptions and type of model used.
Details are important, but looking at details you sometimes miss the overall picture. This, at least, is one conclusion we drew in Sweden from the experiences of the 1990s. The third pillar of oversight is the supervision of the financial infrastructure. This is a relatively new task derived from the complicated technical and legal systems that handle all financial transactions today. The infrastructure is of particular importance to the central bank, since we would most probably have to provide emergency liquidity assistance if anything went wrong. The infrastructure is dominated by the systems for clearing and settlement of payments. In Sweden, like in many other countries, we manage the large-value payment system in-house at the central bank. But the infrastructure also includes the stock exchange, the derivatives exchange, the central securities depositary (CSD) and connected trading systems. Well-designed systems reduce the risk of contagion from the financial markets or between institutions. They also reduce the risk of the infrastructure itself causing problems through, for instance, operational disturbances. 2  BIS Review 58/2003  The Financial Stability Report In Sweden, the main tool for addressing the oversight of systemic stability is the report on Financial Stability. The Report, in Sweden as well as in other countries, basically aims to provide a picture of the banks’ ability to stand up to any disruptions.

Crisis prevention  Turning to my last financial stability issue, that of crisis management, in my view this is mainly a question of being prepared. Or as prepared as possible, I should say, because how can you adequately prepare for the unknown? There are basically two types of crisis: a slow crisis and a fast crisis. By a fast crisis I mean single but severe events like fraud, major loan losses or general events that quickly lead to loss of market or creditor/depositor confidence. These cases call for quick action. Normally the central bank takes the lead because of its ability to provide emergency liquidity assistance and because of its access to updated information on the liquidity situation in the market. But close cooperation is required, especially with the supervisory authority, which has information on individual banks, and with the Ministry of Finance, if there is a need for solvency support. In my experience, there are many possibilities for such a process to fail. Misunderstood information, unclear leadership or conflicts of interest may delay the process until it is too late. The chances of solving a fast crisis increase enormously if all institutions involved have prepared for it, e.g. through crisis management drills. Such drills tend to uncover the shortcomings or conflicts that may prevent smooth cooperation when really needed. A slow crisis, on the other hand, may be detected but not always prevented by financial oversight.