samchain/econo-pairs-v1 huggingface dataset:
In the current international financial environment, this trend has become more pronounced prompting investors to consider other asset classes and markets that provide stability. Thus far, the global financial crisis has had limited direct effects on Islamic finance. While Islamic finance by its very nature only engages in transactions that have underlying tangible productive activities, the slower overall growth and the increased uncertainties have affected pricing and activity in certain market segments. However, this in part reflects the shift in activity from the financial markets to the Islamic financial institutions. The scope of Islamic financial business has now expanded to more sophisticated financial products in response to the changing global customer base. Such Shariah-compliant products include private equity, project finance, the origination and issuance of sukuk, as well  2  BIS Review 121/2008  as fund, asset and wealth management products. The sukuk market in particular, has become an important avenue for international fund raising and investment activities. This market has expanded by an annual growth rate of 40%. The year 2007 saw an exceptional growth of the global sukuk market which expanded by more than 70%. New issues during the year reached a record high to about $ billion and the outstanding global sukuk market has now surpassed the $ billion mark. Up until August this year, it has held its ground with a total global issuance now exceeding $ billion, and is expected to exceed USD200 billion in 2010.

Closing remarks Against a backdrop of an increasingly uncertain global environment, Islamic finance, as a form of financial intermediation in the international financial system, has continued to be viable and competitive. In the coming years, the greater global participation in this developmental process, both directly and indirectly, would enhance the potential role that Islamic finance would have in contributing towards greater global financial stability in the international financial system. BIS Review 121/2008  5
I am not referring here to any desire to usurp the role of those global agencies which are household names to us, even though we may sometimes feel that their understanding of economics and business in this part of the world could be deepened and the rating process itself made more transparent. They focus mainly on rating internationally traded paper. What this region may need is better arrangements for rating domestic and regional issues. How and by whom this might be effected is for discussion. Plainly, it is essential that the investor community has confidence in the expertise and integrity of rating agencies. A more local focus by established agencies, perhaps operating via joint ventures, might ensure such confidence. If that is achieved, then the broader application of ratings may help expand the investor base, notably to embrace those institutional or individual investors who cannot themselves afford to make credit assessments of every issue but who are favourably disposed towards bond investment in principle. The other initiative in hand is to study the potential for more activity in credit enhancement. In some other centres, notably the United States, there exist insurance or guarantee corporations, typically of triple A status themselves, whose business is to sell their backing to the bond issuance of a lesser name so that the latter will be attractive in the market. There has hitherto been only limited activity of this sort in this region, although there were signs of it building up before the Asian financial crisis struck.

But I would expect that there is enough potential here to ensure that the debt markets in Hong Kong as well as in the wider region continue to develop and prosper as we look ahead. BIS Review 57/2000  4
The Ministry of Finance will assess the need to modernise the regulation on monetary policy. After 15 years of the current regulation, a review may be in order. I would, however, emphasise that our experience of the current monetary framework is positive. Confidence in low and stable inflation is firmly anchored. The primary task of monetary policy must always be price stability. When inflation is firmly anchored, monetary policy can also contribute to stable developments in the real economy. Monetary policy can react quickly to cyclical changes, as was the case during the financial crisis when the key policy rate was markedly reduced in order to limit the downturn. The framework has also functioned well in face of the substantial decline in oil prices. The flexibility and room for the exercise of judgement provided by the mandate has strengthened monetary policy and the Norwegian economy. Thank you for your attention. BIS central bankers’ speeches  3  4  BIS central bankers’ speeches  BIS central bankers’ speeches  5  6  BIS central bankers’ speeches  BIS central bankers’ speeches  7

This helps to ensure that the central bank is consistent over time. Monetary policy in recent years Has monetary policy been successful? Has it contributed to satisfying the preconditions for a stable krone exchange rate? Before I attempt to answer these questions, I will briefly review the actual conduct of monetary policy and the decision-making basis. The period between December 1992, when the fixed exchange rate regime was formally abandoned, and 1996 was characterised by balanced growth and a stable krone exchange rate. However, in 1996 the economy began to show signs of overheating. Coupled with an increase in oil prices, this contributed to appreciation pressures on the krone. Interest rates were kept at a low level to counter  BIS Review 7/2001  5  appreciation pressures, and fiscal policy was not sufficiently tight to curb pressures in the economy. Developments since the beginning of 1997 show that the exchange rate is no longer suitable as a short-term operational objective of monetary policy. Norges Bank cannot fine-tune the exchange rate. As mentioned, Norges Bank therefore places emphasis on satisfying the fundamental preconditions for stability in the krone exchange rate over time in its conduct of monetary policy. Instability increased further in 1998. In addition to domestic problems of overheating, which translated into strong cost inflation, 1998 was marked by financial crises in Asia, Russia and Brazil, falling commodity prices and general unrest in international financial markets.
We are looking to issue more and in longer tenor, in the future. As for the MAS Standing Facility, we have, in the last two years, progressively expanded the range of eligible collateral. MAS has signed cross-border collateral arrangements with other central banks. Banks can now use as collateral, Euro and Sterling cash, as well as French, German and British government securities. We are now finalising similar arrangements with the US Federal Reserve, so that banks will be able to pledge US Treasury bills and notes to obtain Singapore dollar liquidity at the Standing Facility. These initiatives significantly enhance banks’ flexibility to tap on global sources of liquid assets. Let me now touch on the regulation of financial markets. A key focus of international regulatory reforms has been on the trading of OTC derivative contracts. MAS will meet objectives set by G20 Leaders on regulation of OTC derivatives as well as recommendations by the Financial Stability Board (FSB). We are now reviewing our detailed policies and will conduct consultation by the end of this year on all aspects of FSB’s recommendations. MAS aims to meet FSB target to implement the recommendations by end 2012. There are four key thrusts in FSB’s recommendations on OTC derivatives trading. First, standardise derivative contracts. MAS is working with Singapore Foreign Exchange Markets Committee (SFEMC) to encourage further standardisation of derivative products. The SFEMC will formulate a code of conduct for financial institutions operating in the OTC market. Second, mandate central clearing of all standardised contracts.

I believe there are three things that finance must aspire to, if it is to be a force for good: it must be trusted; it must be inclusive; and it must be sustainable. This Symposium will cover these issues in greater depth. I want to focus my opening remarks on the issue of trust. Global surveys show that the financial sector suffers from a trust deficit. The Edelman Trust Barometer asked over 33,000 respondents globally to rate how much they trust businesses in each of 15 industries to “do what is right”. Financial services was the least trusted industry. There is also a broader sense that finance has not served the economy or society well. Why this mistrust? The reckless risk-taking and blatant disregard for ethical conduct that we saw in the lead-up to the global financial crisis are a big part of the explanation. And it has not helped that the financial industry continues to be dogged by disappointing revelations of financial misconduct and malfeasance. 1/5  BIS central bankers' speeches  Europe saw its largest ever money laundering scandal last year, with hundreds of billions of Euros in tainted money flowing through European banks and their branches across the world. In the US, regulators and prosecutors imposed on financial institutions a total of $ billion in penalties last year for failing to comply with anti-money laundering requirements. In the UK, more than 13 million complaints have been made against retail banks for the aggressive mis-selling of so-called Payment Protection Insurance.
Sabine Lautenschläger: Fostering global growth Speech by Ms Sabine Lautenschläger, Member of the Executive Board of the European Central Bank, at the panel during the G30 International Banking Seminar, Lima, 11 October 2015. *  *  *  I would like to thank Jacob and Jean-Claude for inviting me to participate in this panel. You will not be surprised that I will focus on the growth challenge faced by the euro area countries in my intervention. Let me stress from the outset that I believe that the euro area can make a much stronger contribution to global growth than it has done so far. But for this to happen, we need a stronger reform impetus in many euro area countries. To substantiate this claim, I would like to address two questions: first, where do we stand on growth and reforms in the euro area? And second, which structural reforms are still needed to support stronger and sustainable growth? Where do we stand on growth and reforms in the euro area? Growth has been recovering in the euro area, albeit at a modest pace. Output growth has been gathering pace throughout 2014 and in the first half of 2015 and employment has been increasing. However, developments are still uneven across member countries and it is not clear that the recovery can be sustained in the medium term.

To refer only to big projects some have been finalized, as it is the case of the Danube-Black Sea Canal, which runs from Cernavodă, on the Danube, to Constanţa (southern arm, as main branch), and to Năvodari (northern arm), on the Black Sea. Other big projects are still in progress, such as the Danube–Bucharest Canal, a 73-kilometre long canal project that is planned to link Bucharest to the Danube via Argeş River. Thus, at the completion of this project Danube could become home for five capitals, including Bucharest. This conference has two main objectives. One is to bring together Romanian financial sector representatives and project initiators; the other one is to find appropriate financial instruments to better highlight the remarkable business potential of the lower Danube basin. I do hope this conference is going to offer you all the opportunity for successful networking and may you find appropriate solutions for vital issues regarding the agenda. I desire you all success with the materialization and accomplishment of your present and future projects and I conclude by wishing all the foreign guests at this conference a good stay in Romania. I am now giving the floor to Mr Kurt Puchinger, Coordinator of the EU Strategy for the Danube Region and chair of the first session, to start the conference. Thank you. 2  BIS central bankers’ speeches
End of the “Great Moderation” This brave new world looked set to continue indefinitely during the early years of this century. Inflation was low and output stable, the so-called “great moderation”. The Holy Grail of growth without risk seemed to have been discovered. Yet moderation was sowing the seeds of its own destruction, dulling the risk senses of central banks, regulators and market participants. In this vacuum, financial risk-taking rose to Himalayan heights. The global financial crisis of 2008 brought that decisively to an end. The financial system and economy tumbled from their Himalayan peaks. Great moderation gave way to “great recession”, the sharpest and longest-lasting since the 1930s. Central banks quickly 2  BIS central bankers’ speeches  acknowledged their pre-crisis blind spot – ballooning debt among both banks and non-banks. And, not for the first time in their history, they reinvented themselves. On the monetary policy front, extraordinary times resulted in extraordinary monetary measures. Interest rates globally were lowered to levels previously never seen, accompanied in some major advanced countries by purchases of government securities – so-called quantitative easing (QE). In some countries, central banks in addition purchased private sector assets, such as mortgage-backed securities and corporate bonds – so-called “credit easing”. Others, including the Federal Reserve and Bank of England, issued forward guidance to help clarify their future policy intentions and thereby shape the yield curve. This was terra incognita for central banks.

The mood is to continue cautiously down that path, but to emphasise the need, not only for sound macro-economic policies, which everyone accepts as a sine qua non, but also for steps to accompany capital account liberalisation designed to reduce the risks of volatility. These relate in part to the process of capital account liberalisation, where there is now a good deal more stress on ‘sequencing’ - that is on liberalising potentially more stable, longer-term, capital inflows initially, rather than short-term borrowing denominated in foreign currency. BIS Review 49/1998  -4-  But they relate particularly to three key conditions for living with free capital movements. The first is “transparency”. In a broad sense a need for greater transparency is recognised in relation to public policy, to the relationship between the public and private sectors, to corporate governance, accounting standards, and so on. In a narrower sense there is seen to be a need for more reliable, and greater and more timely disclosure of, financial information generally, at the level of individual borrowing entities, but especially also in relation to countries’ true foreign exchange short-term asset and liability positions. This is especially important in relation to the foreign currency liquidity position of the monetary authorities and of the banking system.
These forecasts are made more difficult by the continual revision of economic statistics. To reduce the risk of major errors in monetary policy, it is important to bear this in mind when making decisions, and not to have blind faith in the exactness of the measures we use. References Labour Force Survey, March 2010, Statistics Sweden. Bergström, V. and Boije, R. 2005. “Monetary policy and unemployment”, Economic Review, 2005:4: 15–49. Flodén, M., Larsson, A., Ravn, M. and Vredin, A. 2012. “Enkla regler, svåra tider – behöver stabiliseringspolitiken förändras?” (“Simple rules, hard times – does the stabilisation policy  12  The concept of persistency means that unemployment tends to remain at a higher level after recessions or rapid structural transformations and then slowly adjust towards lower, more normal levels. BIS central bankers’ speeches  11  need to be changed?”), SNS (Centre for Business and Policy Studies) Economic Policy Group Report 2012, SNS. Forslund, A. “Den svenska jämviktsarbetslösheten – en översikt” (“Swedish equilibrium employment – a review”). Report 2008: 17, Swedish Fiscal Policy Council. Sveriges Riksbank “The relationship between the business cycle and the labour market in Sweden”, Economic Commentaries no. 2, 2010. Sveriges Riksbank, “The effects of the financial crisis on the labour market – a comparison of Sweden, the euro area and the United States”, Monetary Policy Report, February 2011. Rogerson, R. 1997. “Theory Ahead of Language in the Economics of Unemployment”, Journal of Economic Perspectives 11(1): 73–92. Statistics Sweden, 2010. “Integration – a regional perspective”, Integration: Report 3. Svensson, L.E.O. 1999.

Figure 3 shows the Riksbank’s present assessment of equilibrium unemployment, together with the latest assessments from the National Institute of Economic Research and the Ministry of Finance. Unlike in Figure 2, this is a matter of more long-term calculations of equilibrium unemployment. 10  In Figure 2, NAIRU (Non-Accelerating Inflation Rate-of-Unemployment) has been calculated. The terms NAIRU and equilibrium unemployment are sometimes used as synonyms. There is, however, a theoretical difference. NAIRU is the level of unemployment that is compatible with a stable rate of inflation. The rate of inflation rises when unemployment is below NAIRU and falls when unemployment is higher. This means that, in the short term, NAIRU may vary with economic activity, unlike equilibrium unemployment. However, over the longer term, NAIRU and equilibrium unemployment coincide. 6  BIS central bankers’ speeches  Figure 3 The level of equilibrium unemployment according to the Riksbank, the National Institute of Economic Research and the Ministry of Finance Per cent 12  12  10  10  8  8  6  6 Riksbank  4  4  NIER Ministry of Finance  2  2 Actual unemployment 15-74 years  0  0 80  84  88  92  96  00  04  08  12  16  Note: With regard to statistics on actual unemployment pre-1987 data is spliced by the Riksbank.
Events since will have done nothing to lessen this problem, as successively larger waves of institutions have been supported by the authorities. More recently, the Bank and FSA have been engaged in some practical work with banks, running stress-tests through their models on common scenarios. When asked to assess the consequences of a macro stress-test, the like of which we are currently experiencing, some banks have found it problematic. In defence, they have suggested that such an exercise was only conducted annually as part of their Basel II preparations and as such new stress tests would take months to conduct. This too was revealing. If even the most obvious stress-test took many weeks to prepare and assess, how could these tests meaningfully be used to manage risk? The short answer, I think, is that stress-testing was not being meaningfully used to manage risk. Rather, it was being used to manage regulation. Stress-testing was not so much regulatory arbitrage as regulatory camouflage. Prescribing some solutions Each of these market failures has been exposed by events over the past 18 months. When risks materialised outside of calibrated distributions, risk models provided little guidance in identifying, pricing and hence managing them. This failure is not of purely academic interest. The breakdown of risk models is itself likely to have contributed importantly to crisis dynamics. Why? First, the potential losses arising from under-pricing of risk are large.

(a) September 1720 (South Sea Bubble) (b) October 1720 (South Sea Bubble) (c) October 1987 (Black Monday – portfolio insurance) (d) July 1940 (WWII – merchant ships attacked) (e) March 1974 (Price/wage controls, unions, etc.) 12  -400  -200 0 200 Change in yield (basis points)  0.00 400  Sources: Global Financial Data and Bank calculations. (a) March 1974 (b) October 1974 (c) June 1974 (d) January 1701  BIS Review 18/2009  Chart 9: 90th Percentile VaR for a  Chart 10: Percentage under-valuation of  selection of major UK banks, pre and  a put option on UK equities during the  post crisis  Golden Decade Per cent  Per cent 20  VaR Pre Crisis  18  VaR Post Crisis  90 80  16  70  14  60  12  50  10  40  8  30  6  20  4  10  2  0 0.4  0 1  2  3  4  5 6 Banks  7  8  0.6  0.8  Strike  1  1.2  9  Sources: Bloomberg and Bank calculations  Sources: Global Financial Data and Bank calculations.
Third, if borrowers and investors did not embrace an orderly collateral liquidation mechanism, supervisory oversight could be brought to bear to limit the use of tri-party repo funding on the grounds that it is still an unstable source of funds. For example, the use of tri-party repo could be restricted unless borrowers demonstrated that there was an adequate means of orderly collateral liquidation upon the failure of a major dealer. Turning next to the issue of money market mutual funds, further reform to directly address the incentive for investors to run is essential for financial stability. In November, the Financial Stability Oversight Council (FSOC) put out for comment three alternative paths forward:13 1. Moving to a floating net asset value (NAV). 2. Retaining a stable NAV, but adding a new NAV buffer and a minimum balance requirement. The minimum balance would be at risk for 30 days following withdrawals. If the fund subsequently “broke the buck” during this period by suffering losses greater than the size of its NAV buffer, the minimum balance would be first in line to absorb these losses. 3. A larger NAV buffer than in the second alternative, but without a minimum balance at risk buffer. I have stated my views on money fund reform before.14 Although any of these proposals – depending on the fine print of course – would likely be an improvement over the status quo, the first and third proposals don’t fully eliminate the incentives to run.

Let me mention just four: 1.  to preserve peace;  2.  to improve economic prospects;  3.  to defend our values; and  4.  to increase personal options continent-wide. The founding fathers of the EU were willing to make political sacrifices to end bloodshed in Europe, following two devastating wars just decades apart. Let us not forget that we are here in a former prison in which every respected Luxembourg family had relatives who stood up for these values. After 70 years of peace in western Europe it is easy to be complacent that war will not happen again. Yet the current situation in Syria, Iraq, Ukraine and that of the Balkans in the 1990s shows that peace is vulnerable, even on our doorstep. But defence and security have to be understood as a common endeavour. The economic benefits of the Union are well documented: free trade, the removal of non-tariff barriers, the elimination of transactions costs of foreign exchange payments and the introduction of a single yield curve across the euro area to name but a few. These measures have reduced costs for businesses and households, and in turn generated higher income and created jobs. Looking ahead, also the recovery is on track to overcome the crisis. Europeans, for all our differences, have many values that we share more closely than even close allies such as the United States. Our social model ensures adequate healthcare and workers’ rights that are absent elsewhere.