samchain/econo-pairs-v1 huggingface dataset:
With this infrastructure, the Desk has been able to purchase large volumes of securities in a rapid manner, as required by the policy decisions made by the FOMC. Indeed, over the period since the FOMC’s decision to expand the SOMA portfolio, the Desk has purchased about $ billion of Treasury securities. 7 That total includes about $ billion of purchases out of the intended $ billion expansion of the portfolio, and another $ billion of purchases associated with the reinvestment of principal payments on agency debt and mortgage-backed securities. 8 In terms of the monthly pace, the purchases so far have been  3  See Brian Sack. 2010. “Managing the Federal Reserve’s Balance Sheet.” Remarks at the 2010 CFA Institute Fixed Income Management Conference, Newport Beach, California, October 4. 4  The list of primary dealers. 5  This information is included in a monthly purchase schedule published by the Desk. 6  The methodology for comparing the relative value of the securities at the offered prices is based on a spline fitted through the prices of Treasury securities. 7  These changes are measured since the November schedule published by the Desk, which was the first schedule of operations to come out after the FOMC decision. All data on policy operations are through Friday, February 4, 2011. 8  The purchases associated with these two components are combined in the monthly schedule. To arrive at the totals reported in the text, we allocate the purchases so far this month proportionally across the two components.

An additional dimension of the monetary policy decision of last Friday is to clearly separate the implications for the MPR of recalibrating the monetary impulse in the face of the current configuration of structural parameters and economic variables, of the responses that might be necessary in the face of the evolution of macroeconomic conditions. As I have stressed in this presentation, the world economy is experiencing a delicate moment, where a declining phase of the cycle is combined with high policy uncertainty in the world's leading economies and where financial markets rely heavily—perhaps too much—on the will of the central banks to react to episodes of volatility. Although the world economy continues to grow, we note with concern the escalation and expansion of trade conflicts, a stagnation of international trade, deteriorating expectations and frequent episodes of market volatility. In these circumstances, as we have pointed out before, the Chilean economy, despite its commercial and financial openness, has powerful buffers, given by the exchange rate, the depth of the domestic financial market and the anchoring of expectations. However, it also has room for robust policy responses, particularly of monetary policy. Having solved the past imbalances of the MPR helps us identify future phenomena and apply the proper responses. On other occasions we have said that the Central Bank of Chile is prepared to face new challenges. Recent decisions include an additional element in this statement: the evidence that we have the capacity to identify important changes and react with the necessary speed.
In the aftermath of this crisis, this shortcoming again became evident when the degree of fiscal policy coordination provided for in the fiscal framework fell short of the aggregate stimulus that was needed to complement monetary policy in a low inflation environment. That said, we should commend the way in which the fiscal policy response during the pandemic learned from past experiences. Temporary, centralised fiscal instruments were put in place to complement the activation of the SGP escape clause, which allowed for highly expansionary national fiscal policy stances. If we were to draw one lesson from this brief historical detour, it could be that, beyond its foundational components, the fiscal governance framework embedded in the Treaty has been continually adapted to a changing environment. Significant headway has been made, particularly in times of crisis. However, the successive reforms have not addressed all of the pending issues. Beyond the undoubtedly successful and appropriate coordinated action during the pandemic, varying degrees of improvement could be made to the current policy mix’s underlying design. Moreover, the huge need for fiscal support during the pandemic forced the suspension of the fiscal framework and led to a significant increase in the level of public debt, greatly reducing the fiscal space, against a background of pressing long-term public investment needs in the fields of digitalisation and climate change. In this context, high inflation and the shift towards a restrictive monetary policy might encourage financial markets to pay more attention to debt sustainability concerns.

Together we have prepared the banking system for the new times ahead, and the FROB has played a key part in this process. Some very significant challenges remain, but we now have more mechanisms at our disposal and institutions that are better prepared to address these challenges. Thank you very much for your attention. I now give the floor to the Vice-President of the European Central Bank, Luis de Guindos. 2  J. CARMASSI, S. DOBKOWITZ, J. EVRARD, L. PARISI, A. SILVA and M. WEDOW (2018), Completing the Banking Union with a European Deposit Insurance Scheme: Who is Afraid of Cross-Subsidisation?, Occasional Paper Series 208, European Central Bank. 7/7
But in the limit monetary policy can be a backstop – as booms and busts increase the likelihood that inflation will be volatile in the future. Overall, the Committee’s Forward Guidance can forestall avoidable uncertainty about its “reaction function”, about how policy will be set. But it does not affect the greater uncertainty about the evolution of the recovery. Uncertainties about the economic outlook Of course, financial markets inevitably transform the Committee’s state-contingent guidance into predictions of when the Committee will begin to withdraw monetary stimulus; the markets trade instruments with different maturities, ie with time-contingent features not with statecontingent contractual triggers. But the MPC provided state-contingent guidance for a reason. We cannot wave away the uncertainties surrounding the performance of the real economy. If we only understood why productivity growth has been so weak, we could be more confident about whether or not it will recover in tandem with a recovery in spending. If that does happen, the fall in unemployment could be slow, and monetary stimulus might not need to be withdrawn for some time. If, on the other hand, productivity growth remains weak, job creation as the economy recovers could be strong, as it has been on average over the past couple of years. That is why there is a wide band of uncertainty around the MPC’s August forecast for unemployment. My own probability distribution for unemployment is broadly “flat” in the sense that I do not regard one of those scenarios as materially more likely than the other.

Philipp Hildebrand: The virtues of flexible financial markets - a central banking perspective Summary of a speech by Mr Philipp Hildebrand, Member of the Governing Board of the Swiss National Bank, at the CFA Institute Annual Conference, Zurich, 22 May 2006. The complete speech can be found in German on the Swiss National Bank’s website (www.snb.ch)  *  *  *  Summary Rapid technological change and market liberalization have been the driving forces behind the remarkable evolution of global financial markets over the past three decades. The consequences of this development include a geographic rearrangement of global capital markets, a fast pace of product innovation and changes in the nature and composition of financial market participants. The benefits associated with today’s flexible financial markets are manifold. Financial markets have become much more efficient in allocating capital. New products enable a better distribution of risks and the liquefaction of previously illiquid assets. They have also increased market transparency. As a result, modern financial markets facilitated innovation and likely enhanced economic growth. Moreover, they have contributed to make economies more resilient to shocks. These extensive benefits notwithstanding, modern financial market also entails new risks. These risks tend to elicit calls for increasingly far-reaching regulation. While some regulation may indeed be required to guarantee the integrity of financial markets, the threshold for such regulation should be set high.
I have just seen that our two main banks are moving in this direction and are also giving preferential treatment to mortgages. You also have to remember that a bank manages two sides of the balance sheets. It collects interest from borrowers but it pays interest to depositors. It is the efficient management of the difference between interest earned and interest paid that earns a bank its profits. Given that both lending and deposit books may differ from one bank to the other, there could be various reasons why the full interest rate cut is not passed on to the customer straight away. Are you optimistic that these interest rate cuts are enough to stave off recession? Monetary policy is just one instrument available for macroeconomic adjustment, so it has a limited capacity. It just tries to achieve price stability, because without price stability you cannot have long-term investment plans plus economic growth and employment. The problem is deeper than that. We need a coordinated effort at the political, central banking and regulatory levels. There is talk of a looming recession in Malta. Do you agree with this argument? I have not seen any economic indicators which at this point in time suggest that this scenario is imminent. I would rather wait to see the figures as they come out. So far we have an average growth rate of over three per cent for the first half of the year.

The gravity of the situation only became fully apparent a year later. The government is insisting the local banks are under no threat from the international financial crisis because of their conservative lending. Do you concur with this point of view? Maltese banks are not directly threatened by the financial crisis. Our banks do not hold asset-backed securities associated with the sub-prime crisis. And as the International Monetary Fund confirmed last summer, they are well capitalised and have high liquidity ratios. Maltese banks do not generally borrow from the international money markets to fund lending operations but rely on customers' deposits. It is significant that at the end of September, deposits by Maltese residents amounted to € billion, which is equivalent to one-and-a-half times Malta's GDP. That was an increase of € million since the end of 2007. Our banks, moreover, have very prudent lending policies. They have diversified portfolios and appropriate risk management systems. This explains why the fallout from the crisis has been fairly limited. Like investors everywhere, however, all our banks and other investors are seeing the value of their investment portfolios decline as a result of the generalised decline in asset prices. This will result in lower profits, but since our banks are well capitalised they are able to cope with it. This does not mean there should be room for complacency, particularly at times of unprecedented market dysfunctionality and a looming global recession.
Just as monetary policy represents the first line of defence in managing the business cycle, regulation and supervision of financial institutions must be the first line of defence in maintaining financial stability. It is not sufficient for individual banks to be solid. Banks are closely interlinked. They obtain funding from common sources and from one another, and large portions of loan exposures are in the same markets. High credit growth can result in financial imbalances that have system-wide effects. System-wide risk is therefore far greater than the risk of individual banks. BIS central bankers’ speeches  15  The financial crisis showed the severe damage that can be caused when insufficient attention is paid to system-wide financial risk. Banking regulation has therefore been strengthened by including a macroprudential component. The instruments employed are not new, but an important difference is that banks are required to hold more equity capital than previously. The required level is based on the overall risks to the financial system. Some requirements may vary over time, such as the countercyclical capital buffer. The regulation of the Norwegian financial sector is in line with international standards. In recent years, a number of instruments have been implemented in Norway to mitigate risk in the banking system. In response to the sharp rise in real estate prices and household debt, the countercyclical capital buffer has been increased and bank lending standards tightened. Moreover, capital surcharges have been introduced for systemically important banks.

References Adrian (T.) and Shin (H.S.) (2007): "Liquidity and Leverage". Journal of Financial Intermediation. Forthcoming. Available on the New York Fed website as Staff Report no 328. Adrian (T.) and Shin (H.S.) (2009): "Money, Liquidity and Monetary Policy" Forthcoming in American Economic Review, papers and proceedings. Available on the New York Fed website as Staff Report no 360. Committee on the Global Financial System. CGFS Papers No 34. "The role of valuation and leverage in procyclicality". April 2009 (available on the Bank for International Settlements – BIS-website). Danielsson (Jon) and Shin(Hyun Song): "Endogenous Risk ";London School of Economics September, 2002. 9  For an analysis, see Kashyap and al. (2008). BIS Review 94/2009  5  Kashyap (AK), Rajan (R.G) and Stein (J.C.) (2008) "Rethinking Capital Regulation". Paper presented at the Federal Reserve Bank of Kansas City Symposium. 6  BIS Review 94/2009
Far more often, it has been the other way around […].”  II  Financial systems, risk allocation and economic growth  One major function of a financial system is to reallocate risk between different economic agents. Through such reallocation, borrowers can tailor their risk profiles and therefore, are provided with greater access to capital. Savers become better able to diversify and to manage their portfolios. Gains are unquestionably generated from the efficient capital allocation resulting from improved risk sharing. For instance, high-return (and innovative) projects, which tend to be riskier, will be better financed. For investors, efficient risk management may increase their ability to hold portfolio of high-risk projects while, at the same time, reducing their overall exposure through diversification. 3  R. Levine (2002): “Bank-based or market-based financial systems: which is better?” William Davidson Working Paper n°442. 4  V. Dolar and C. Meh (2002): “Financial structure and Economic Growth: a non-technical survey”, Working Paper 2002-24, Bank of Canada. 5  A. Greenspan (1999): “Do efficient financial markets mitigate financial crises?”, Remarks before the 1999 Financial market conference of the Federal Reserve Bank of Atlanta. 2  BIS Review 64/2006  A  Risk sharing and financial innovation  In the past thirty years, financial systems have undergone sweeping changes. Financial innovations, such as the development of the derivatives markets and the securitization of assets, have enabled intermediaries to better diversify and manage risk. Financial derivatives have revolutionised global capital markets.

This is, in my view, a very productive area for future research for academics and regulators alike. Let me conclude by two points about Central Banks. First, they have a natural interest in the efficiency and stability of the financial system. Asset prices are a key channel through which monetary policy is transmitted to the real economy. The ability of the financial system to absorb shocks smoothly was supported by more predictable and transparent monetary policies in many countries. Stable and low inflation helped to reduce the financial system’s sensitivity to shocks. Second, for this reason, they have to monitor closely the process of financial innovation. Different approaches, involving both the public and the private sector, should be combined to enhance transparency, such as (i) the improvement of financial standards and supervisory regulation, (ii) an improvement of data reporting on OTC markets (bonds, derivatives), (iii) efforts to foster better disclosure from financial institutions, (iv) promotion of stronger market discipline. It is my strong belief that this can be done without impeding the efficiency and agility of modern finance, which is so important for our growth and future prosperity. 6  O. Cousseran and I. Rahmouni (2005) “The CDO market-Functioning and implications in terms of financial stability”, Financial Stability Review n°6, Banque de France. 4  BIS Review 64/2006
The situation today is thus similar, with countries around the world contemplating how best to conduct macroprudential policy. In some areas, particularly in some emerging markets, they already have some experience of what could be described as macroprudential policy. However, the results have been somewhat mixed and it is unclear what lessons can be learned. The research on macroprudential policy has now begun in earnest, but it is still quite new and has not yet generated any very clear conclusions on which to base a policy. It is probably unavoidable, therefore, that practical policy-making in coming years will consist to a great extent of “learning by doing” – with the emphasis on both “learning” and “doing”. Stabilisation of the financial cycle One of the two main tasks of macroprudential policy is to counteract the build-up of financial imbalances in the economy. This task can be described as macroprudential policy trying to stabilise something I here choose to call the financial cycle. The academic literature on this subject contains other similar concepts such as “credit cycle” and “leverage cycle.”1 What this means in simple terms is that the volume of loans, indebtedness, asset prices and attitude to risk in the economy vary over time in a way that is not necessarily linked to the economic cycle. One usually calls this the cyclical dimension, or time series dimension, of macroprudential policy.

The second task of macroprudential policy is to manage structural risks, or cross-section risks, which could for instance mean that close links between different parts of the financial system at any given time will affect the risk of a crisis affecting the system as a whole. Here, I will primarily focus on the cyclical dimension of macroprudential policy. However, it is not so easy to draw any clear boundary between structural and cyclical problems on the financial markets, just as in other areas, such as the labour market. 1  2  For a few examples, see Geanakoplos (2009), Aikman, Haldane and Nelson (2010) and Borio (2012). BIS central bankers’ speeches  In Figure 1, the red line represents the normal cyclical fluctuations in the economy, the business cycle. The second curve in the figure represents the financial cycle. As I noted, the economic cycle and the financial cycle need not coincide, but can develop differently. Often, the financial cycle is assumed to have a lower frequency, fluctuate more slowly, than the business cycle, as illustrated in the figure.2 Links between the financial cycle and the business cycle can create problems A situation where both cycles definitely coincide is when the financial cycle shows a rapid downturn, as at the end of the figure. This was what happened in many countries during the financial crisis, and in Sweden during the crisis at the beginning of the 1990s.
In light of this, the 1990 Budget Enforcement Act (BEA) introduced restrictions to the discretionary component of expenditure and ground rules designed to restrict spending to real revenue; on the basis of those rules, any new discretionary spending (apart from the legislation on social security and revenue) was to have a neutral impact on the budget. Thanks to this method, a positive budget balance was achieved and maintained for a certain amount of time under the Clinton administration. Yet the deficit’s disappearance proved short-lived; negative balances were repeatedly recorded in the wake of the taxation and spending policies adopted by President Bush’s administration. 3.4.2  The economic structure  Moving on to the deep-seated differences in economic structure, a crucial difference between the United States and the euro area lies in the far smaller size of the US government sector. 24  Alesina, A. and E. L. Glaeser (2005), A World of Differences. Fighting Poverty in the United States and in Europe. Published by Editori Laterza, Bari. 25  Persson, T., G. Roland and G. Tabellini (2000), “Comparative Politics and Public Finance” , Journal of Political Economy, No 108, pp. 1121-1161; Persson, T. and G. Tabellini (2003), The Economic Effects of Constitutions, Munich Lectures in Economics, MIT Press, Cambridge. BIS Review 135/2008  9  It follows that the automatic stabilisers, in particular, operate in somewhat different contexts in the two economic areas. This could partly explain why countries with larger governments generally show less product variability.

François Villeroy de Galhau: Presentation of the 2016 Annual Report of the ACPR Speech by Mr François Villeroy de Galhau, Governor of the Bank of France and Chairman of the Autorité de contrôle prudentiel et de resolution (ACPR), at the press conference, Paris, 29 May 2017. * * * I am pleased to welcome you today for the presentation of the 7th activity report of the Autorité de contrôle prudentiel et de résolution (ACPR), with Bernard Delas, Vice-President of the ACPR, Rémi Bouchez, President of the Sanctions Committee, and Edouard Fernandez-Bollo, Secretary General of the ACPR. As you know, the ACPR and its 1,046 staff members have a broad field of action. The ACPR guarantees the stability of our financial system, through the supervision of banks and insurance companies, but it also guarantees the protection of French customers and savers. First of all, I would like to mention our essential involvement both at the European and the international level. I will then present the results of the main French banking and insurance groups, before addressing four major challenges that strongly shape the ACPR’s action: low interest rates, digital finance, customer protection, the fight against money laundering and the financing of terrorism. * * *  I. The ACPR’s action at the European and international level At the European level, the ACPR has taken an active part in furthering the deployment of the Banking Union.