samchain/econo-pairs-v1 huggingface dataset:
However, bail-in is not yet a well-defined concept in the international policy discussion; I’m not sure how my description of a mechanism resonates with the overall discussion. Right now, the common theme of a set of bail-in concepts is putting in place a statutory or contractual trigger that would convert a firm's debt into equity, thereby immediately strengthening the firm's capital base. Short-term debt and liabilities would likely be excluded. To move the bail-in mechanism from concept to a meaningful proposal, the official community needs to develop one or more specific proposals that can be vetted, debated and improved. In that spirit, let me list some areas in which a bail-in proposal needs to be more specific. A proposal needs to make clear:   The nature of the trigger. Is it contractual or supervisory? Is it rule-based and if supervisory, rule-based or discretionary? 6  BIS Review 140/2010    The desired capital structure before a bail-in. Consonant with the work in Basel on capital and liquidity requirements, how much bail-in eligible debt should the firm have? To answer that requires specifying goals for the capital structure of the restructured firm. It is probably crucial that the post-bail-in capital structure provide enough loss-bearing capacity to make regeneration of the company's prospects credible.   Estimates of the market capacity to purchase bail-in eligible instruments relative to the amounts of such instruments that would be needed and the price sensitivity of markets to volume and financial institution credit quality.

Given these critical roles and the risks posed by periods of sharp volatility, understanding the manner in which the evolving market structure is affecting market liquidity, efficiency, and price dynamics is of the utmost importance, and something we plan to study further. Best practices in the treasury market The Treasury Market Practices Group (TMPG) recently released a consultative white paper that addresses the effects of ongoing changes in automated trading on the structure of the Treasury market. This study was well under way before October 15, but it includes some preliminary observations from the TMPG on that event as well. The TMPG is a group of market professionals, sponsored by the New York Fed, committed to supporting the integrity and efficiency of the Treasury, agency debt, and agency mortgage-backed securities markets. The group has released a wide range of best practices for these markets, including a fails charge that resulted in a dramatic decline in delivery fails in Treasury securities and agency MBS, and the recommendation to margin forward agency MBS trades, a practice that now covers most bi-lateral forward trades in that asset class. The TMPG white paper on automated trading in the Treasury market includes an updated set of best practice recommendations that provide additional guidance for firms and trading venues involved with electronic and automated trading. Some of the changes to the best  8  BIS central bankers’ speeches  practices have to do with improving governance and back-office processes to keep pace with technological advancements.
Jaime Caruana: Words of welcome - ECB Governing Council Dinner Speech by Mr Jaime Caruana, Governor of the Bank of Spain and Chairman of the Basel Committee on Banking Supervision, at the Governing Council Dinner on the occasion of the meeting of the European Central Bank Governing Council, Madrid, 7 June 2006. *  *  *  It is a source of great satisfaction for me to welcome you to this dinner on the occasion of the meeting of the ECB Governing Council in Madrid. We are particularly honoured by the presence of the President of the Government and by that of the other authorities and personalities accompanying us today. As many of you are aware, this is the second time the Governing Council of the European Central Bank has met here. The first was in March 2000, a little more than one year after the start of Monetary Union, unquestionably the most visible feature of European construction. On that occasion, the euro area economy appeared set on a notably dynamic path with year-on-year growth exceeding 3% and the Spanish economy, in turn, was maintaining a sustained pace of expansion, benefiting from the favourable monetary and financial conditions and strong job creation. Against this backdrop, Spanish citizens could already perceive the favourable effects of our participation in the euro area and, therefore, the success of the economic policies applied during the convergence process.

It is thus no exaggeration to say that those present at a similar dinner six years ago felt quite optimistic about the prospects for the European economy, within Monetary Union, although the Union had only just taken its very first steps and euro banknotes and coins had not even begun to circulate. We now have the benefit of the experience built up in the intervening period. The euro has meant tangible benefits in terms of savings on transaction costs for citizens, eliminating exchange rate risks within the area, facilitating market integration and it has provided an environment of economic and monetary stability. The ECB has attained high credibility in a short period of time which is undoubtedly a result of the clarity of its objectives, the effectiveness of its strategy and the soundness of its decisions. Nevertheless, it is a fact that the European economy has not managed to repeat growth figures close to those seen in 2000. It has been prone to bouts of notable sluggishness, highlighting - in addition to the effect of an unusual series of adverse shocks - the structural shortcomings holding back activity and employment. We have therefore seen that, despite the favourable effects a monetary policy unequivocally geared to price stability has on economic prosperity, the full effectiveness of its contribution requires an ambitious reform agenda in other economic policy spheres.
My first speech as Governor – in 2003 – was also in the Midlands. In it, I talked about the non-inflationary consistently expansionary – or “nice” – decade from the early 1990s to the early 2000s. I argued that the next decade was unlikely to be as nice because, and I quote, “when shocks, as they will, hit our economy it is almost inevitable that there will be somewhat greater volatility of both output and inflation than the remarkable stability to which we have become used in recent years”. I certainly did not anticipate the scale of the downturn in the world economy that followed the collapse of the banking system in 2008. But I did point to the need for a rebalancing of demand in the UK economy because, as I said then, “the strategy which the MPC has pursued in recent years – stimulating domestic demand to compensate for weak external demand in the face of a strong exchange rate – carries the risk that there could be a sharp correction to the level of consumer spending at some point in the future”. BIS Review 136/2010  1  The counterpart to strong consumption in the past was low saving. Having averaged close to 20% in the 1960s and 70s, gross national savings fell to just 12% of income in 2009 – the lowest since the War. This was all the more remarkable because one might have expected saving to increase as life expectancy rose.

We should now, when the economic and financial situation in the world is relatively calm, take the opportunity to simplify and clarify the rules further, particularly as regards their application. When the next financial crisis occurs it may be too late. Another aspect of the Fund's function in crisis management is its role when countries are forced to suspend payments. It is possible to further strengthen the instruments available today – Collective Action Clauses as well as Principles for Stable Capital Flows and Fair Debt Restructuring – in order to ensure a transparent and predictable debt restructuring process for borrowers and lenders. These instruments lay the main responsibility for agreeing on debt renegotiation terms on the borrower countries and creditors. The Fund’s most important function in such circumstances is to provide the parties with the best possible information about the economic situation so as to facilitate agreement. The Fund should also try to contribute to ensuring that economic policies in the debtor country make it possible in the longer run to restore balance and to reduce the country’s debt to a level that is sustainable in the long term. The Fund itself may have to provide some financing to achieve this, but when it comes to countries in highly vulnerable positions Fund financing can only play a limited role. It will not always be possible to bring about a sustainable debt level in this way without drawn-out negotiations and considerable economic costs.
Michael Gondwe: Women’s access to financial services in Zambia Opening remarks by Dr Michael Gondwe, Governor of the Bank of Zambia, at the “Women’s Access to Financial Services in Zambia – Dissemination and Consultation Conference”, Lusaka, 24 June 2014. *  *  *  •  Permanent Secretary, Ministry of Finance;  •  Permanent Secretary, Ministry of Gender and Child Development  •  Permanent Secretary, Ministry of Commerce  •  Bank of Zambia Board Members  •  Your Excellences, High Commissioners and Ambassadors to Zambia present;  •  The United Nations Development Programme Country Director, Ms Viola Morgan;  •  The African Development Bank Country Representatives; Dr Freddie Kwesiga;  •  Representatives from the International labour Organisation (ILO);  •  Deputy Governor Administration, Bank of Zambia Dr. Tukiya Kankasa-Mabula  •  New Faces, New Voices Representative, Ms Nomsa Daniels  •  Chairpersons of the Boards of Commercial Banks,  •  Chief Executive Officers of Banks and Other Organisations;  •  Senior Staff and Colleagues from Bank of Zambia;  •  Members of the Press;  •  Distinguished Guests, Ladies and Gentlemen. It is my honour and privilege to welcome you all to this conference on Women’s Financial Inclusion in Zambia. May I extend a special welcome to delegates that have come from abroad. I wish you a good stay and hope you will have time to visit the various places of interest and sample the food that Lusaka offers.

Sir Andrew Large: Financial stability - maintaining confidence in a complex world Speech by Sir Andrew Large, Deputy Governor of the Bank of England, at the City of London Central Banking Conference, National Liberal Club, London, 17 November 2003. *  *  *  I am often asked what we mean by financial stability and what the Bank, or “the authorities” generally, are doing to maintain it. Let me start with the observation that maintaining financial stability is different in a number of important respects from conducting monetary policy. There is no quantified target; no foolproof way of deciding where to look for potential threats; and no fixed timetable for policy decisions. Financial stability is altogether less tangible and more elusive. But it is nevertheless extremely important - as the substantial costs associated with financial instability demonstrate. The Bank of England has had an interest in financial stability for a very long time. But for most of that time its interest was implicit rather than explicit. In the more formal structure put in place in 1997, after the Bank was granted operational independence on monetary policy, our financial stability role was laid down in a published Memorandum of Understanding between HM Treasury, the Bank and the FSA. Today I would like to make a few observations on some of the issues at the top of our current agenda. Financial crises are nothing new. Indeed the Bank has been handling them since the eighteenth century. Some are signalled well in advance.
In the rolling year ending in the second quarter of 2022, the current account accumulated a deficit of 8.5% of GDP, its highest level in several decades. This reflects the significant imbalances between public and private savings and spending in 2021. The projection foresees a decrease in the current account deficit in the coming years, consistent with the adjustment of spending on tradables and an increase in public and household savings after the imbalances of 2021. The adjustment of the economy will imply negative growth in activity and demand in 2023, implying several quarters of contraction. After that, the economy will resume growth rates close to its potential level. In the latest IPoM projections, we anticipate a GDP growth range of between 1.75 and 2.25 this year, a fall of between -1.5 and -0.5 next year, and growth between 2.25 and 3.25% in 2023. Preliminary activity data for the third quarter (IMACEC) confirm the generalized weakness of practically all sectors, with relevant contractions in commerce, industry and construction. Private consumption will continue to tighten, reflecting the end of the large income support measures adopted in 2021, the slowdown in the labor market and the effects of monetary policy.

However, this has diminished during 2022 with the recovery of labor supply and lower demand. The peso's depreciation has also played a relevant role in the rise in inflation. The increase in the exchange rate has been caused by a combination of internal and external factors, where the former have a greater weight. In recent years, the Chilean currency has lost value vis-à-vis other comparable currencies, mainly because of greater local uncertainty and some political-legislative decisions taken in previous quarters. More recently, the peso's evolution has been more linked to the dollar's global appreciation. Data for the quarter ending in August shows that job creation is stagnant, the unemployment rate remains at 7.9% and labor participation has stabilized. On the other hand, the Internet Job Postings Index shows a decreasing trend during the year. Nominal salaries present annual increases of around 11%, and real salaries remain at negative values close to 3% annually as of August. 1  Bilateral Meetings  •  Persistence  Inflation expectations have remained above the 3% target for several quarters. Although some measures they have receded somewhat at the margin, the fact that they have remained elevated for so long increases the risk of a mores persistent inflationary process and constitutes a very relevant point of attention for the Board's decisions. In fact, the latest Financial Operators' Survey (FOS) indicates that expected inflation in one-year falls to (previous: 6.3%) 6.0% and in two years to 4.5% (previous: 5.0%).
Estimates of unfunded pension liabilities range up to several trillion dollars. While widespread, underfunding of public pensions is not universal. Many states have found ways to keep their public pensions reasonably well funded, demonstrating that pushing today’s costs into the future is not an inevitable outcome of a democratic government. Nonetheless, we have seen evidence that high debt levels combined with diminished services provision can, in cases such as Detroit and Stockton, make the public sector finances unsustainable. At a certain point, the debt service burden clashes with maintaining a sufficient ongoing provision of services to forestall people from voting with their feet. This may occur well before the point that debt service capacity appears to be fully exhausted. In other words, the prioritization of cash flows to debt service may not be sustainable beyond a certain point. While these particular bankruptcy filings have captured a considerable amount  2  BIS central bankers’ speeches  of attention, and rightly so, they may foreshadow more widespread problems than what might be implied by current bond ratings. We need to focus our attention today on addressing the underlying issues before any problems grow to the point where bankruptcy becomes the only viable option. So, I am especially pleased to see that your agenda today focuses, in part, on helping cities and states avoid such levels of fiscal stress, where the risks of going past such a tipping point become significant. In summary, state and local governments have enormous financial obligations, as well as critical service delivery responsibilities.

Now this large dollar amount in and of itself is not a problem. When governments invest in long-lived capital goods like water and sewer systems, as well as roads and bridges, it makes sense to finance these assets with debt. Debt financing ensures that future residents, who benefit from the services these investments produce, are also required to help pay for them. This principle supports the efficient provision of these long-lived assets. Unfortunately, as the Volcker-Ravitch task force emphasized, issuing debt to finance infrastructure investments is not the only reason that states and localities borrow from the future. Governments have also borrowed to cover operating deficits, and this kind of debt has a very different character than debt issued to finance infrastructure. Let me take a moment to explain what I mean and why I think this distinction is important. BIS central bankers’ speeches  1  When a jurisdiction borrows to invest in infrastructure, the cost of the debt to local residents – and those considering locating in the jurisdiction – is offset by the value of the services that the infrastructure provides. This tradeoff is part of the “fiscal surplus” that a jurisdiction offers: the value of the services minus the tax price that residents have to pay. A well-run capital budget will match these costs and benefits over the life of each project to ensure that the jurisdiction remains attractive to current and future residents.
Two elements are vital in this process. The first is to ensure that the domestic intermediation process remains strong so as to support domestic demand. And secondly, the fiscal stimulus is key to containing the effects of the external developments and to placing Malaysia in a position to resume growth once conditions in the global economy stabilises. During this challenging period, financial institutions including Islamic financial institutions have an important role to ensure the continuous access to financing by the private sector. Key to this, is the forward looking business strategies being adopted by banking institutions, the organisational structure and the operational capability that is put in place. I would like to take this opportunity to highlight two other important dimensions in the development of Islamic finance, going forward. For more than two decades, the Islamic financial system in Malaysia has gradually transformed into a comprehensive Islamic  BIS Review 25/2009  1  financial landscape. This has been reinforced by a legal and regulatory framework, the essential financial infrastructure, and an environment conducive for product innovation. Notwithstanding the success of Islamic finance, the global ramifications of the crisis also calls for more concerted efforts to bring the industry to a higher level of resilience. Of importance, in this process, is to embrace the values of Islamic finance of justice and fairness that benefits the society and the system. It is thus important for Islamic finance to transcend beyond just the pursuit of growth and monetary performance but also to emphasise ethical market conduct practices.

Anecdotally, the role of migrant labour has increased in various sectors – partly associated with the enlargement of the EU’s single labour market. If that continued, with new residents continuing to help to meet particular skill shortages, the labour supply available to UK businesses would increase, implying that the economy could potentially accommodate stronger aggregate demand than otherwise. However, the available data do not really enable us to get beyond anecdote and speculation. Financing Another important input for firms is finance – for working capital and investment. Here too, there seem to have been changes – in the range and terms of the sources of finance available to both firms and households – that could potentially influence the extent of cyclical fluctuations in output and inflation. One characterisation of the past would be that firms and households depended on bank loans for external finance; and that banks loosened or tightened credit conditions sharply in the different phases  5  See, for example, Nickell S. and Quintini G.,(2002), ‘The recent performance of the UK labour market’, Oxford Review of Economic Policy, Vol. 6(4), pages 26-35. BIS Review 16/2005  3  of a business cycle, reining back when the economy suffered a downturn and arrears and losses mounted.
One feature that may cause global investors to rebalance their portfolios in the future is a reappraisal of the prevailing outlook for inflation and, hence, for monetary policy across advanced economies. Such a reappraisal may occur as we are currently observing that the long period of very low global inflation may have affected investors’ deep-seated beliefs about the future. This is most visible when looking at current levels of long-term inflation risk premia in both the United States and the euro area. You can see this on my next slide. Here we have a decomposition of long-term inflation-linked bonds and swaps into the same two components that I showed for nominal bonds on my second slide, namely expected future inflation and an inflation risk premium. The interpretation is identical: just as investors demand a premium for interest rate uncertainty, they also demand a premium for the uncertainty around the expected future inflation rate. And while in the past this premium tended to be positive on average – even during the most turbulent times of the great financial crisis – it fell sharply in 2014 and is still in negative territory in the United States today. In other words, investors are willing to pay a higher price for nominal bonds because they value them as a hedge against low inflation. So, this slide conveys two messages. The first is that markets do not question the credibility or ability of central banks to steer the economy towards their inflation aims.

At face value, this would suggest that the repricing of interest rate expectations at the short end of the US curve has not been passed through to long-term rates. This interpretation is incorrect, however. Indeed, and this is my second point, the broad stability of the ten-year yield masks two sharply diverging developments: a marked fall in the term premium – the yellow area – and an appreciable repricing by markets of the expected future path of short-term interest rates – the dark orange area. You can see this clearly on the slide. Put simply, if it weren’t for the parallel fall in the term premium, ten-year Treasuries would trade some 50 basis points above their January 2017 levels and we wouldn’t be having a discussion about flattening. US long-term yields have resisted upward pressure only because of a considerable re-compression of the term premium. Only shortly after the UK’s referendum on EU membership in summer 2016 was the US ten-year term premium more negative than it is today. This allows for one preliminary conclusion but begs one question. The conclusion is that markets seem sanguine about the prospects for the US, and probably also for the global, economy. Judging from the average expected short-term rate over the next ten years, the markets appear to have shaken off some of the pessimism that caused them to tread very carefully over the past few years. Past and currently expected policy rate changes are predicted to last.