samchain/econo-pairs-v1 huggingface dataset:
I am passionately convinced of the need for a public service, and affected by its current crisis: its necessary modernisation, its re-legitimisation, recognition for civil servants, is not incompatible with its capacity to perform and innovate, on the contrary. The transformation of the Banque de France is a modest but real example. The idea is not to reduce public spending overall, but to stabilise it. Bringing spending growth down to 0.5% per year from 2023 onwards would lower the debt ratio to 100% of GDP in ten years, assuming the rate of tax and social security contributions remains constant - I insist on this condition; stabilising our spending in volume terms would enable us to reduce our debt even further, to 90% of GDP. The target to be set is obviously a matter for democratic debate. But the most important thing is that the targets set for this "overall spending limit" actually be respected, which unfortunately our country has never been able to do in the long term. The choice of priorities or savings to be made also legitimately belong to the political debate. I would just like to point out that the key issue of the quality of spending is the blind spot in our budgetary debate, whereas it can guide us here. Economic analysis shows that spending for the future – most investment, education, research – has a much better "multiplier" effect on growth over time than simple current spending.

Resistance is strong, particularly among those who gain most from squeezing through the loopholes. There is also an in-built professional inertia among regulators, lawyers and tax accountants with large  2  BIS central bankers’ speeches  amounts of human capital invested in complexity. In removing complexities, society’s gain would be their loss. Nonetheless, in the light of the financial crisis, we may be nearing an inflection point, where the societal pendulum begins to swing in the opposite direction. There are certainly signs of the red tape tide beginning to turn in the area of financial regulation. A growing chorus of concern has emerged recently about complexities and inconsistencies in banking regulation. Earlier this year, the G20 Finance Ministers and Central Bank Governors committed themselves to addressing this problem. So too has the Basel Committee on Banking Supervision. This is a good start. But, at this stage, it is no more than that. One risk is that the regulatory inclination may be to tackle this problem slowly and piecemeal, to unwrap the onion one layer at a time, to avoid throwing the baby out with the bathwater. As Axel Leijonhufvud once remarked to me in a different context, while the bathwater in this case may be worth reusing, the baby would never have come of anything. Thin-slicing reform, whether regulation or tax, condemns us to failure. Peeling the onion one layer at a time tends to end in tears.
This was in connection with a discussion on the general increase in prices that was expected to happen in the United States: Even those who tend to agree with the concept of a rough balance between supply and demand (i.e. no inflationary or deflationary gap), point out that there is still a huge money supply— and that is the hard core of inflation…. In time, this concept began to be used increasingly often, especially when inflation began to rise at a rapid pace in the beginning of the 1970s (see Figure 1). 4 According to Gordon (1975a), the higher rate of inflation was due to a number of factors: That food prices had begun to increase faster as a result of supply factors in the United States and abroad, that the oil price had risen as a result of production restrictions introduced by the OPEC oil cartel, that the Nixon administration had introduced price and wage freezes and the devaluation of the dollar in 1971 and 1973. Now a need arose to distinguish temporary price increases from more lasting ones. 3 See, for instance, Rogers (1998) for a discussion of how central banks use the concept. The next reference in the same text search of Wynne is Sprinkler (1975). He writes: “Recent price increases of 10-12 percent annually were about double the hard-core inflation”. 4  3 [19]  Figure 1. CPI inflation in the USA Annual percentage change.

This activity is the first in its kind, and I express my highest considerations for the trust that the Bank of England has put to the Bank of Albania. The Centre of Central Banking Studies is internationally recognised as a centre of intellectual excellence in the area of central banking studies. Considering the goal that this centre has set to itself, as an opportunity provider to central banking employees to be endowed with ampler perspectives in the respective areas of expertise, I call for your attention to listen to what the distinguished experts shall say. Their professional achievements and the central banks they represent guarantee this. Thank you and good proceedings! 2/2
21  This might help explain why the UK’s labour share has  fallen less markedly than in these other countries. Using the Acemoglu and Restrepo ready-reckoner, if the UK had the same degree of industrial robot penetration as the US spread over a decade, this would lower 22  wage growth by around 0.4 percentage points per year. 19  For example, Acemoglu and Restrepo (2018). IMF (2017). These automation measures take no account of differences in industry structure across countries. 22 We use 0.4 as the approximate mid-point of the Acemoglu and Restrepo range. 20 21  11  All speeches are available online at www.bankofengland.co.uk/speeches  11  What is true across countries appears also to be true across sectors. Chart 22 plots a measure of automation across sectors against changes in the labour share. It suggests a downward-sloping relationship, consistent with increased automation depressing pay. (d)  Monopsony  A final factor influencing the pay power of workers is the degree of concentration in the corporate sector. There has been much recent discussion of the rise of so-called “superstar” firms, benefitting from global network economies of scale and scope. 23  The larger a company’s share of the product (monopoly) or labour 24  (monopsony) market, the greater its degree of power over customers or workers. Measures of industry concentration in the US (and in some other countries) have trended upwards, secularly and significantly, over several decades.

The higher the  BIS Review 56/2003  1  long-term sustainable rate of growth, the easier it is for us to balance aggregate demand in the economy so that it coincides with what is available for household consumption, business investment and the needs of the public sector. So monetary policy cannot raise the potential growth rate but, in a worst case scenario, as we witnessed during the 1970s and 1980s, it can worsen our chances of attaining a high potential growth rate by affecting demand in the economy in the wrong way. Consequently, on an abstract level, the “formula” for economic growth is very simple. It is the weighted sum of labour force growth and capital growth as well as technological progress. However, when we compare growth between different countries, it is not that interesting to note that a country has high growth because its labour force is growing fast. It is the standard of living that is of interest and this does not have to improve just because the population and labour force are growing. The important issue instead is how quickly a country’s production grows per capita and this leads us into concepts such as productivity in a broad sense. For productivity is just that - production per capita. It can be measured per inhabitant, per employee or per hour worked. The concepts are closely related. One interesting observation is that the United States’ rapid growth in recent years has been attributable mainly to high labour force growth.
I begin with a brief description of international developments over the next few years and then present my view of Swedish monetary policy in the period ahead. Abroad There are many similarities between the situation in the autumn of 2008 and the spring of 2011. For the world as a whole we once again expect to see a GDP growth of over 4 per cent per year, although there are considerable differences between different regions. Growth is continuing in the United States and Europe although, due to the financial crisis, at a slower rate than after a normal downturn. We expect to see a GDP growth of around 3 per cent per year in the United States and of just below 2 per cent per year in the euro area, with an inflation rate of almost 2 per cent in both areas. But the emerging economies are growing rapidly (see Figure 16). The strong increase in demand in the emerging economies is pushing up the demand for energy and commodities. There has therefore been a substantial increase in crude oil prices and the prices of other commodities recently. There is a risk that these prices will continue to rise and that inflation will therefore also rise in both the emerging markets and the developed countries. Inflation expectations have also increased in recent months and there has been an upward shift in monetary policy expectations (see Figure 4).

5  See The Nation’s Report Card, http://nationsreportcard.gov. BIS central bankers’ speeches  5  I would argue that an additional factor favors Texas: We have a Legislature that under both Democratic and Republican governors has over time deliberately crafted laws and regulations, and tax and spending regimes, encouraging business formation and job creation. Just last month, Fairfield, Calif.-based vehicle reseller Copart Inc. announced that it will move its headquarters to Texas, citing “greater operational efficiencies.”6 The CEO for the owner of Hardee’s and Carl’s Jr. restaurants, Andy Puzder, claims it takes six months to two years to secure permits in California to build a new Carl’s Jr., whereas in Texas, it takes six weeks. These two anecdotes from California alone clearly illustrate that firms and jobs will go to where it is easiest to do business – not where it is less convenient and more costly. Both state and federal authorities need to bear this in mind as they plot changes in the fiscal and regulatory policy needed to restore the job-creating engine of America. As an official of the Federal Reserve charged with making monetary policy for the country as a whole, I am constantly mindful that investment and job-creating capital is free to roam not only within the United States, but to any place on earth where it will earn the best risk-adjusted return.
Indeed, the combination of sluggish economic growth globally and continuous expansion of alternative capital have led to too much insurance capital finding too little risks. These include traditional risks like property and casualty risks. At the same time, the insurance sector is struggling to find solutions for new and emerging risks. This confluence of structural changes across demand, intermediation and the supply side of the insurance value chain is an unprecedented phenomenon. But the outlook is not for all grey skies ahead. The challenges also present a unique set of profitable growth prospects for the industry, particularly here in Asia. Asia’s changing risk landscape The Asian risk landscape is changing rapidly, with demand for insurance services projected to grow especially quickly in emerging Asia as incomes rise, life expectancy increases, and Asians become more aware of catastrophic risks. Asia currently accounts for 28% of the global insurance market, and premiums in the region are expected to double by 2020, with more than $ trillion generated. So why is excess capacity not being deployed in Asia which faces the greatest need? Many of Asia’s risks, ranging from marine, to property catastrophe insurance, to directors and officers liability, are actually insurable and traditional risks. Yet, Asia continues to remain severely underinsured. Many of these insurable risks are often not well understood or well developed in this region, due to a lack of risk awareness, insufficient data and nascent insurance markets.

The insurance protection gap is widening inexorably: •  Close to half of the world’s most underinsured countries are in Asia, and of these, half are in Southeast Asia. BIS central bankers’ speeches  1  •  In the past two decades, Asia has borne 50% of the estimated global economic cost of natural catastrophes. Yet, less than 5% of all disaster losses in Asia are insured, compared to 40% in developed nations. •  The 2008 Sichuan Earthquake is a case in point. Less than 1% of the total economic costs of $ billion were insured. The disaster further left governments and taxpayers with a hefty reconstruction bill of almost $ billion after the event. Going forward, it will also no longer be sufficient to just focus on traditional risks. As Asia continues to grow and become more digitally-connected, new and emerging risks will arise and we should be proactive in adapting to these needs. I would therefore like to challenge the industry to: •  raise insurance penetration of traditional risks and find innovative ways to cast the net wider to cover more insureds, and  •  develop innovative and meaningful risk transfer products for new and emerging risks. Specifically, I would like to highlight 3 key growth drivers for insurers and reinsurers today: •  New and emerging risks  •  New capital  •  New technology and innovation.
Since then, many banks have been benefiting from higher exemption thresholds and have an incentive to take on liquidity via the money market. As expected, this demand for liquidity led to higher trading volumes and a slight rise in SARON and other short-term repo rates in the week following the introduction of the new calculation basis (cf. chart 4). The SNB was active in the repo market from time to time in order to keep SARON close to the SNB policy rate. The Swiss franc repo market functioned smoothly throughout the transition, not least thanks to the state-of-the-art and reliable money market infrastructure. The SNB trades using the same infrastructure as the banks on the interbank market. This is particularly helpful as it ensures that the SNB’s operations are highly effective. Transitioning from Libor to SARON  SARON is currently establishing itself as the leading reference interest rate for financial products in Swiss francs and is replacing Libor. As you know, the UK’s financial regulator will only be supporting Libor until the end of 2021, so it is important that the transition process on the market take place now. Over the last few years, the National Working Group on Swiss Franc Reference Rates (NWG) has put forward recommendations on how to proceed with replacing Libor. Market participants must now act decisively to implement these recommendations. A SARON-based swap market is especially important for the financial markets. Swap markets are used to hedge interest rate risk (e.g.

in mortgages); the associated transactions produce a swap curve, which serves as a benchmark for pricing and valuing bonds and loans. To date, however, trading – and hence liquidity – in SARON swaps has been low. This will change once more SARON-based cash products become available. The successful transitioning away from Libor therefore hinges on the development of such products. Page 2/6  Berne, 12 December 2019 Andréa M. Maechler  News conference  In order for SARON to be used as the reference rate for cash products, a longer-term interest rate must be calculated from the daily rate. As early as 2018, the NWG recommended various options for calculating an average interest rate based on realised SARON values. This approach, known as compounding, is also gaining traction abroad. A wide range of options for calculating such average rates has been proposed and evaluated. At its latest meeting, the NWG was more specific and narrowed down its set of recommended options. 1 As a result, market participants can now begin embedding the compounding approach in products such as mortgages. In addition to new SARON-based cash products, solutions must be found for existing Liborbased products. Ideally, these will be replaced by new, SARON-based contracts. At the very least, the existing contracts must be furnished with fallback clauses, which will come into effect when Libor is no longer available as a reference rate. I should stress that it is evident that the Swiss franc Libor will cease to exist.
Key lessons may be drawn from the recent crises that have affected emerging economies - though not only them - which should be borne in mind when designing mechanisms to reduce their frequency and cost. They include most notably: the need for a sound and well-designed institutional framework that protects property rights, prevents excessive public - or private-sector debt from accumulating and ensures economic stability; the importance of ensuring consistency between the exchange rate regime and the domestic economic policies and institutional framework; the risks entailed by the vulnerability associated with exchange rate instability processes for the balance sheets of different sectors in the economy, especially when there is a high degree of dollarisation; the marked sensitivity of emerging market economies to potentially very volatile capital flows, the direction of which can change suddenly due, at times, to factors that may even be exogenous to the country experiencing them; the importance of an appropriate regulatory and macro-prudential supervisory system to prevent crises  2  BIS Review 37/2004  generated in the financial system and to alleviate the ensuing costs if such crises finally occur, and to cushion the effects of shocks stemming from the real sector of the economy; and, finally, the importance of distinguishing, as far as possible, between liquidity and solvency crises in countries’ external debt and in governments’ public debt, as a first step towards applying suitable remedies for resolving each type of crisis.

The links between exchange rate crises and banking crises - the so-called twin crises - and the feedback mechanisms between the two are, along with the propagation and contagion channels from one country to another, matters of particular importance here. National regulators and supervisors, in addition to their initial aim of safeguarding the solvency of individual institutions, have given increasing importance to combining the presence of flexible, efficient financial markets and intermediaries with the absence of excessive volatility on financial markets and to prevent the so-called systemic risks - which affect the whole of the financial system - from materialising. International financial institutions have also become increasingly oriented towards the need to ensure a proper functioning of international financial markets and to limit the transmission of shocks from one country to another in a world of ever deeper and swifter linkages. The relationship between national and international financial stability is obviously all the more important for countries, such as Spain, whose banking system has a significant presence abroad. The expansion of Spanish banks into Latin America explains why the Banco de España has, in recent years, promoted the monitoring and analysis of financial stability problems in this region in particular, and in the emerging market economies in general, an area in which the role of the International Monetary Fund has become increasingly important.
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.

This suggests that the industry is ripe for transformation to a new growth trajectory. The industry in essence has not delivered the required results. Jumping the “S-curve”: The need for positive feedback loops Successfully jumping the cusp of the “S-curve” is the only way to realise the aspiration of a deeper and more diverse insurance market. This calls for transformational change, driven and reinforced by positive drivers that will revitalise the industry. In the context of financial services today, these drivers focus on three “T”s – talent, technology and trust. These three factors can be harnessed to catapult the industry onto a path of new and stronger growth, or they can precipitate its decline over time. The industry must secure the former for its future expansion or else it will continue plateauing. Let me speak briefly on these three factors. Firstly, we must grow the talent we need to bring our insurance and takaful sector to the next level. As our economic structure evolves, we will need a deep pool of insurance and takaful professionals who can develop and support new solutions for managing risks. Unfortunately, talent shortage has been a persistent issue which, if not resolved, will not only hold back the industry from gaining new ground; it could lead to a further retrenchment of business growth. The industry needs to make further efforts to attract and nurture new talents.