samchain/econo-pairs-v1 huggingface dataset:
As a result of this decline, the Libor, which is supposed to reflect the major banks’ unsecured refinancing costs, is now hardly ever based on effective transaction prices but instead relies almost exclusively on estimates. In response, the UK’s Financial Conduct Authority has announced that it will no longer maintain the Libor after 2021. All market players will have to make careful preparation for this. In Switzerland, work on replacing the Libor is already well advanced, but a complicating factor is the rate’s widespread use. The national working group on Swiss franc reference rates (NWG), which is in charge of ensuring a smooth transition, has identified SARON as the preferred alternative solution to the Libor. SARON has already established itself as a reference interest rate, and there is now an interest rate curve based on SARON. It is crucial to have a SARON-based curve capable of being used instead of the Libor curve, for price setting across the Swiss franc capital market. Amounts outstanding on the overnight swap market (OIS) based on SARON are currently low, but are likely to grow significantly in the future. In this connection, I would also like to mention that the first SARON-based futures contract was launched only around ten days ago, and traded on the Eurex platform. In the future, when products based on SARON (loans, mortgages, etc.) are brought to market, trading volumes for the associated collateral instruments will increase. These instruments, in turn, can be used for loan pricing.

The successful operations of both Macedonian Interbank Payment System (MIPS), the RTGS system of which the central bank is both the owner and operator and Klirinski Interbankarski Sistemi Skopje (KIBS), of which the central bank is the settlement agent, have contributed to a high level of confidence throughout the years and have a positive effect on the stability of the banking and financial system and the economy as a whole. To conclude, commercial banks transferring among them funds held in accounts with central banks have facilitated the proper functioning of the banking and financial systems and mitigated disruptions and instability globally. This historical development has been accompanied with a slow, but steady movement towards a higher velocity of money circulation. Settling payments in accounts at the central bank still provides the link with the two main tasks of monetary policy and financial stability. While steering monetary conditions the central bank cooperates with commercial banks and thereby reduces transaction costs. This reality is a layered architecture in which central bank money is the ultimate settlement asset in the economy. The positive network externality is best described by referring to the risk reduction, service assurance and competitive neutrality the central bank provides. Using money held in accounts at the central bank to effect payment is generally regarded as risk free, service is assured even in extraordinary times of global and domestic crises, while using the central bank as a hub ensures that payment systems’ participants are not forced to rely on actual or potential competitors for payment.
One thing is clear in our work, it is time to take stock on this issue. Thank you. 4  BIS central bankers’ speeches

Nevertheless, when you take up a position as a board member, you also have a responsibility to discharge your responsibility in a very professional and systematic manner. My dear friends, it is necessary for everyone to exercise a certain financial discipline within the organization. If the top people are lax, or if the board members do not ask the questions that need to be asked, then the tendency is for financial discipline to erode within the company. My dear Chairmen and CEOs, don't be frightened of, or upset with, the people who ask tough questions at Board Meetings. My dear Directors, don't feel over-awed or shy to ask the tough questions at Board meetings. You must do that. We want you, as Directors, to do that because it is not possible for the Department of Supervision of Non-Bank Financial Institutions to be doing all the questioning from the Chairmen & CEOs. We are performing a regulatory function. We will see whether the overall framework is in place. We will want to see whether your overall risk assessment positioning is acceptable. But, the actual running of the business is your responsibility. You have to ask the tough questions. You have to ensure that sound internal controls are in place. You have to look at the future plans to ascertain whether you are on the right track. Often, I have seen eminent and respectable people accepting board positions, but not getting involved in the governance of the company. That is not good enough, especially in finance companies.
An eclectic approach should not be ruled out. (c)  Rules or discretion? As I have said on a previous occasion, we are doubtful that macroprudential instruments could be operated by a rule. To steer the banking system towards increasing its resilience to incipient problems in a stretched sector, a whole series of judgments would have to be made. Whether the rate of credit growth seemed excessive; whether terms were overly lax; or whether the “bubble bursting” would materially damage banks. That would call for assessments of the levels of indebtedness, of banking system exposures, of the broad probabilities of those exposures turning sour, and of whether herding in the market might be driving the system into an ever more precarious position. Rapid growth in debt does not of itself signify over indebtedness; and default does not necessarily materially impair lenders’ resilience. One possible way of thinking about this is that the authorities could be guided by top-down stress tests of the effects on the banking system of various adverse scenarios potentially affecting different groups of borrowers and exposures. In very broad terms, this would be akin to systematically applying Pillar II-type judgments under the Basel regime to banks in general. It would share with the Pillar II element of micro-prudential regulation a focus on circumstances that warranted a capital charge different from the Pillar 1 minimum. But it would differ in a number of important respects. First, the instrument would be applied to all banks in the jurisdiction.

Or into whether monetary policy could be used to control asset prices as well as doing its orthodox job of steering nominal trends in the economy, which I should say can include taking account of prospective risks of inflation volatility over the medium term. Ideas circulating already include minimum margin requirements or capital ratios that vary not only across instruments or firms but also through time as credit conditions change. We need calmly to explore whether there are also other possibilities. But let me make this absolutely clear: there are formidable obstacles to finding a solution. In the monetary sphere, a regime of floating exchange rates allows individual countries to  6  BIS Review 134/2009  instruments, whether the instruments would be operated under a rule or discretionary judgments, and whether it was feasible for one country to attempt to employ such instruments in a world of freely flowing capital. I will sketch our preliminary views on those questions. The Bank will publish a Discussion Paper, going deeper than I can today, over the next few weeks. We do not have all the answers and I must stress that we are not in advocacy mode, but we have reached the point where we should like to try to inject some further thoughts into the debate.
The main reasons for changing payment habits include the increased convenience of the electronic payments, for example increased limit on the amount of contactless payments, the perceived risk of infection from banknotes, governments’ recommendations to use cash less, as well as more difficult access to and lower acceptance of cash at the points of sale. This trend in payments is unlikely to be reversed. Almost 90% of the respondents stated that they would continue to use cash less once the pandemic is over. Similar trends in payment habits can be observed in our country as well. Consumers have shown strong preferences for using cashless instruments such as cards. For example, the number of payment transactions initiated on the virtual point of sale last year doubled and continued to raise at double-digit growth rates this year. Also, the volume of contactless card payments increased by about 50% in 2020 and this trend has continued this year. Obviously, advancement in technology opens the doors to innovative digital services, but to unlock its true value for businesses and consumers, we as regulators have a role to play. In this context, clear example is the Payment Services Directive 2 (PSD2) that opened up EU payments market to higher competition, by establishing a level playing field for traditional players and new entrants, while providing higher protection for consumers. The new concept of open banking was conducive to richer payment landscape with numerous new entrants (third party providers) and numerous new customer-centric services.

Thus, payments enabled by new providers have just started to take off, but it looks promising to become a new normal as they are expected to improve the user experience. How fast this segment of the financial system in the EU is developing can be witnessed by the approximately 300 new providers operating by midSeptember this year, which is just two years since the application of the new regulation-relevant regulatory technical standards under the PSD2 (Open Banking Report, 20212). Most of the companies that offer these innovative services are fintechs, but open banking also 3 1/3  BIS central bankers' speeches  offers a possibility for traditional banks. In fact the survey conducted by Accenture3 finds that three quarters (75%) of the banks see payments modernization as being driven by changes in the national payments infrastructure and regulation, which include improving bank-to-bank payments systems, new industry standards and open banking. The rapid move to digital payments has put additional pressure on banks, with three-quarters (75%) of bank executives saying that the pandemic has increased the urgency of their plans to modernize payment systems. Pressures are felt by the central banks as well. In response to changes in consumer payments preferences, the need to further increase efficiency of payments, as well as the disruption caused by COVID-19, the interest in central bank digital currency (CBDC) has also increased. In fact, last year was the launch of the first “live” digital currency in the Bahamas.
Debt levels and developments in housing prices are taken into account in the Riksbank’s forecast of future inflation through their effects on household wealth and thereby on demand in the economy. It is difficult of course to predict how households will act, but we usually assume that they are rational and able to make sound judgements of how the economy will develop and how this will affect their borrowing costs. This is not necessarily a correct assumption. For example, it’s conceivable that households in certain situations would react stronger to a rate hike than to an equivalent rate cut. Should households not expect interest rates to rise in an economic upturn and a rate hike by the Riksbank came as something of a surprise, it could have effects on consumption beyond those predicted in our models. We discuss these effects and try to take account of them outside our models to the extent that we believe it is justified. Were households to react stronger than expected, it could mean that we don’t need to raise interest rates as quickly in an economic upswing as we otherwise would have done. BIS Review 67/2004  3  The question of the real economic effects beyond the forecast horizon is trickier. When a speculative bubble bursts, it can result in rapid price falls, but also in poorer economic growth and higher unemployment in the longer-term. Naturally, this is something we want to avoid if possible.

In a liberalised financial market environment, the central bank contributes to the reduction in lending rates by reducing inflation. The Government also contributes by implementing prudent fiscal policy, thus limiting the incidence of crowding out of the private sector by the Government. As a result, yield rates on Government securities fall. As inflation and yield rates on Government securities decline, lending rates are also expected to decline in the medium to long term as the two provide the relevant opportunity cost of lending to the private sector. Another factor that commercial banks take into consideration in determining lending rates is the default risk arising from the poor credit culture in the economy in general. In resolving the problem of poor credit culture, the Central Bank through the Financial Sector Development Plan, facilitated the establishment of a credit reference bureau which collects information on borrowers to be used by credit providers. Furthermore, in order to increase competition in the financial sector the Bank of Zambia has registered a number of commercial banks and other financial institutions to operate in Zambia. In 2009, the number of registered banks increased from 14 to 17. In addition, the Bank of Zambia is developing a framework to migrate from the use of monetary aggregates as the anchor of inflation expectations to the use of interest rates.
But the widespread use of such data to price annuities began only with the calculations of Richard Price in 1780 and the Institute of Actuaries in 1869. In Holland more accurate calculations of the prices of annuities date back to de Witt in 1671. See Poterba (2004). 6  Manton et al (1991) and Caselli and Vallin (2001) describe alternative approaches to inferring the limit to human life. Some estimates assume that life expectancy will converge to that of the longest-lived population; for example, that life expectancy in the West will rise to that in Japan, the country with the highest life expectancy. But the level in Japan has itself increased significantly over the past century. So what determines Japan’s life expectancy? Another approach is to examine how life expectancy might change if everyone adopted lifestyle patterns that increase longevity. Mormons and Seventh Day Adventists seem to live longer than the rest of us, but exactly which aspects of their lifestyle we should adopt is not entirely clear. See, for example, Enstrom (1989). Yet another approach is to work out the contributions that different human diseases make to premature death, and calculate the hypothetical life expectancy that would result if medical science were to be able to eliminate these diseases. This ‘cause elimination’ approach was adopted in the 1950s by Pichat. The number derived was 75. This is the number that the UN used until the early 1980s in their population projections.

Both women were convicted by juries which had in all likelihood been influenced by the assertion that the probability of two cot deaths in the same family was extraordinarily low. That assertion was based on the assumption that cot deaths in the same family were independent events, a view for which there was  11  See, for example, Thompson and Schuman (1987). BIS Review 73/2004  5  no scientific evidence and which is a priori implausible.12 The assumption of independence was crucial to the prosecution evidence against Sally Clark that the odds of two cot deaths in a family such as hers were 1 in 73 million and so would be expected only once a century. Given the complex and conflicting medical evidence, it would not be surprising if that striking and simple statistic had played a role in helping the jury come to its conclusion. In fact, as pointed out by Professor Ray Hill, the statistical evidence on cot deaths suggests that in England and Wales we should expect several cases a year.13 Thankfully, both women were eventually released after winning their appeals, albeit largely on other grounds. Why then do probabilities cause us so much difficulty? Our understanding of probabilities evolved through counting the frequencies of various events, whether the number of days in summer on which it rains or the outcomes of tossing a coin. All this was part of our evolutionary experience long before the concept of probability was invented in the seventeenth century.
Chart 14 provides a benchmark in which the 𝑓(·) function is assumed to be linear (an assumption that underestimates net benefits relative to a convex 𝑓(·) function) and the weight on the secondary objective, 𝜙, is set to one. It shows that the tools are likely to provide significant expected net benefits in the event of a housing boom, and these increase as the size of the housing boom increases. In the absence of a housing boom, there are unlikely to be material costs (Chart 14).21  20 To date, the Recommendations have largely acted as an insurance policy. Since they were introduced, banks, in  aggregate, have been well within the 15% limit (the maximum share of high LTI lending in aggregate has been 11%). In part, this is likely to reflect the fact that the housing market has been relatively subdued since the policies were introduced. There has, however, been some ‘bunching’ of mortgages with LTIs between 4 and 4.5 suggesting that, as intended, lenders are judging it prudent for some borrowers to take smaller mortgages than may have been granted in the past. In aggregate, this bunching effect has been small. 21 Note that the benefits and costs in Charts 14 and 15 are different. Chart 14 shows a discounted sum of the expected costs and benefits in each year of a scenario. It takes into account the probability that the costs and benefits will be incurred over a given period, the relative persistence of costs and benefits, and discounts both.

The chart shows Norges Bank’s estimate for public purchase of health and care services. The estimate is based on the assumption that the public sector will finance the same share of public services as today. The source for the estimate for public consumption is the Government’s Long-Term Programme, and the estimate is, among other things, based on unchanged tax rates. The fundamental problem is that demand for health and care services is growing faster than tax revenues. There will be a limit on the extent to which the state can reduce appropriations for other important social objectives such as education, research and the judicial system. Something has to give. 17  BIS Review 14/2000  Chart 20  Even after all the structural changes of recent years, there is probably still room for efficiency gains in the health and care sector. However, this is hardly sufficient to fully address the challenges. Users may therefore have to finance a substantially greater share of these services, whether the services are provided by public or private operators. There are limits to the extent to which the public sector should and can impose user fees without creating unacceptable distributional effects. A private insurance system is not a fail-proof solution. It seems obvious that there is a need for a clearer definition of the public sector’s core activities in the health and care sector, and in other areas. There is a need for delimiting what the public sector should finance based on tax revenues.
The agenda for this conference – covering topics such as cyber security, artificial intelligence and digital currencies - gives an insight into the scale and pace of innovative thinking currently taking place in the payments industry. Innovation is at the heart of the topic I will be focusing on today – cross-border payments. I will cover why greater innovation is needed in cross-border payments and outline the G20 initiative to develop a roadmap for action. I will then seek to bring it to life by outlining some of the key developments already underway at the Bank of England to support the international agenda in this area. Cross-border payments lag behind  Over the last decade or so, there has been a strong focus on further enhancing domestic payments with a significant increase in instant payments and great innovation at the customer-facing end. Just consider our ability to pay for goods and services not just with cards and phones but also with watches and smart speakers. There is also a move to enhance the core underlying infrastructure. In the UK, the Bank of England is renewing its Real Time Gross Settlement Service and Pay.UK is developing a New Payments Architecture for retail payments. Many other countries are undergoing similar transformations, including the US with FedNow and Australia’s New Payments Platform. Traditionally, however, there has been less focus on cross-border payments even though they are so significant in both value and volume.

Building block 15 calls for harmonised API data protocols and the Bank will support this objective in its development of an API layer. The Bank is also involved in the more exploratory building blocks in Focus Area E. In the light of the continued decline in cash for transactional purposes, and great technological advancement, many central banks, including the Bank of England, are considering whether introducing a CBDC would be appropriate. In March this year, the Bank published a discussion paper10 to explore the benefits, risks and practicalities of a retail CBDC in the UK. We have received valuable feedback from across the payments industry, technology providers, academics and public authorities and we look forward to setting out more information in due course. The Bank’s Financial Policy Committee also set out regulatory expectations for payment stablecoins in 2019 and 2020, which is feeding into our work on designing appropriate regulation and requirements for firms proposing these. As set out in the building blocks it is important that as these issues are debated it is also done with an eye to how they could support cross-border payments. These examples provide just a taste of the areas that the Bank of England is involved in and we will be working closely with other central banks and relevant organisations to address the building blocks as a whole.