samchain/econo-pairs-v1 huggingface dataset:
It is hard to see beyond one of two ways of interpreting this statement, 2/4  BIS central bankers' speeches  neither of which stands up to much scrutiny. The first interpretation is that the rules should not change in the future, and to do so would be unwelcome. This is unrealistic, dangerous and inconsistent with practice. As the world around us changes, so must the rules to accommodate these changes. As evidence of this, look at what the authorities have had to do in response to Covid and the shock that created for financial markets. The EU is almost constantly revising, or contemplating revising its own rules, and that’s a good thing. So, I dismiss this argument. The second argument is that UK rules should not change independently of those in the EU. I am being careful to phrase this point. It’s not that UK rules might change independently – the equivalence process provides for re-assessment of such decisions, so this should not be a problem. So, it must be the stronger form that they should not change independently. But that is rule-taking pure and simple. It is not acceptable when UK rules govern a system 10 times the size of the UK GDP and is not the test up to now to assess equivalence. It’s worth considering why we would choose to change the rules. First, it would be rare to say the least if such rules turn out always to work perfectly first time and thus need no amendment.

Thomas Jordan: The significance of academic research and teaching for the Swiss model for success Summary of a speech by Mr Thomas Jordan, Chairman of the Governing Board of the Swiss National Bank, at the Dies academicus, University of Bern, Bern, 1 December 2018. * * * The complete speech can be found in German on the Swiss National Bank's website (www.snb.ch). The success of Switzerland in recent decades has largely been driven by the strong performance of its education system, which is crucial for economic prosperity, social cohesion and equality of opportunity overall. The Swiss National Bank (SNB), too, sets great store by a good education system, including universities that can hold their own against international competition. Many of the staff recruited by the SNB are destined for roles in which a university degree is a prerequisite. In addition, the SNB maintains close ties with the academic world, so that the latest related research findings can be incorporated into monetary policy decision-making. The competition of ideas stimulates and creates incentives for higher-quality monetary policy. This pursuit of excellence in academic education should not just be aimed at research, however; it should also target teaching. Experience has shown that foundation courses have a lasting effect on students' attitudes to certain topics. Teaching lays the basis for subsequent academic specialisation and career choice. As role models, professors carry a heavy responsibility.
Mark Carney: Three truths for finance Remarks by Mr Mark Carney, Governor of the Bank of England and Chairman of the Financial Stability Board, at the Harvard Club UK Southwark Cathedral dinner, London, 21 September 2015. *  *  *  I am grateful to Ben Nelson and Iain de Weymarn for their assistance in preparing these remarks. “All England is an American shrine, full of rich records of the makers of their nation.”1 None more so than glorious St Saviour’s – Southwark Cathedral – a few minutes south of the river from here. Its connection with Harvard makes it something of an American Mecca. For at St Saviour’s was baptised a Southwark butcher’s son who became benefactor to the university that would bear his name. John Harvard would doubtless be delighted with what has become of the 320 volumes and £ he bequeathed to posterity: a college founded for the avoidance of leaving “an illiterate ministry to the churches, when our present ministers shall lie in the dust”. From that bequest sprung one of the world’s leading universities. A community dedicated to its motto: Veritas – truth; the pursuit of truth in the sciences, humanities, even economics. Truth to create a better world. But recall Pilate’s question that has echoed down through the centuries from the pulpits of Southwark Cathedral to Memorial Church, “Truth? What is truth?” Indeed, upon arriving at Harvard, students and visitors are confronted with a curious truth, or rather, three untruths.

In the case of Japan, monetary policy can end the deflation that has characterized the economy since the late 1990s, but can do little to infuse  2  BIS central bankers’ speeches  long-run expansion unless it is accompanied by fiscal policy that implements structural change. But the biggest problem the U.S. confronts is homegrown: political failure in Washington to act on the key issues holding the recovery hostage. Fiscal and regulatory uncertainty is a powerful deterrent to business investment. Going back to the earliest days of the current recovery, my business contacts have regularly complained of the fog of uncertainty emanating from Washington. They have consistently cited fiscal and regulatory uncertainty as major impediments to capital investment and expanding payrolls. Uncertainty comes in many forms. In some cases it is major legislation such as the health care reform or financial regulation as in the Dodd Frank [Wall Street Reform and Consumer Protection] Act. Fiscal issues have regularly constrained the recovery – the debt ceiling debacle in summer 2011, the last-minute resolution of the fiscal cliff in December 2012, the brute force sequester of 2013 and so on. Most vexing is not knowing how businesses will be taxed or how the federal government will shape future spending. This makes budgeting and planning capital outlays and payrolls into the future an uncertain process.
Set up in 1952 under the auspices of the Banco de México and with the support of six other founding central banks (the central banks of Chile, Colombia, Cuba, Ecuador, Guatemala and Honduras), CEMLA has for seven decades promoted debate over, and a better understanding of, important monetary and financial matters for the region’s monetary authorities, and helped share best practices in the different areas of central banking among all of its associate members. CEMLA currently has 31 associate members and 20 collaborating members, and has established itself as the foremost institution in Latin American central banking. The Banco de España has worked closely with CEMLA since joining as a collaborating member in 1965. After participating in CEMLA’s governing bodies in an observer capacity for two decades, last year the Banco de España became an associate member, thus reinforcing its commitment to the organisation. Allow me to share with you now, in these opening remarks, a few brief thoughts on the need to reinforce multilateral cooperation in the current geopolitical context to which I have just referred. Russia’s attack on Ukraine is taking an appalling toll in terms of lives, destruction and displaced persons. Of course, it is also having an economic impact, one that is putting our responsiveness to the test. The war broke out at an already delicate juncture for the world economy, with the various regions emerging from the pandemic at different speeds and amid much uncertainty, inflationary tensions and global production chain disruptions.

This can only be agreed under the veil of ignorance,8 i.e. under the expectation that participating economies, in their diversity, have comparable strengths and weaknesses. And that is why such a new social contract can only happen at the end of a new convergence process. As to which level which budgetary responsibilities are allocated, and how they are matched by appropriate democratic arrangements, I believe this is ultimately a political decision. It should emanate from a political process, and I note that other federations with more developed forms of political union such as Switzerland or the United States have found very different answers to this question. Further integration within the euro area raises the difficult issue of the relationship with the “outs”. Adequate safeguards have to ensure full consistency with the Single Market, which is the European Union’s most valuable achievement. However, while such safeguards will have a bearing on the design of euro area integration, they cannot change its direction. The biggest threat to the Single Market is not euro area integration: it would be euro area stagnation.9 Conclusion Ladies and gentlemen, The triathlon competitions here in Vouliagmeni ended a decade ago. The challenge of making EMU work is far from over. In fact, we are now just out of the water. Let’s get ready for the bike race and not forget about the running that will come later. Many thanks for your attention, and I am now looking forward to our debate.
There is among the Nordic countries an acceptance on the positive long term net effects on productivity, growth and employment. Globalization creates opportunities for new jobs. • The reason for the positive view on globalisation in the Nordic countries might be a broader social security net and public policy that help people who lose their jobs due to trade as well as technology. Training and education improve employability and reasonable replacement ratios in unemployment benefit and other social benefits can mitigate the negative short-term effects of globalization. These are all fiscal or structural policy issues, outside the scope of monetary policy, but still important in a global perspective. • To summarize: Globalisation and technology are strong forces that rapidly shape the world. Policymaking is needed to facilitate the changes that ensue for individuals, companies, the public sector and countries as a whole. In that policymaking, I want to stress that each and every policy area should do what it does best to make good contributions when the changes are being managed. • Thank you! --------------------------------  References • Alvaredo, F., A. B. Atkinson, T. Piketty, and E. Saez (2013), “The Top 1 Percent in International and Historical Perspective”, Journal of Economic Perspectives Volume 27, Number 3, 2013. • Bivens, J., (2015), “Gauging the Impact of the FED on Inequality During the Great Recession”, Hutchins Center on Fiscal and Monetary Policy at Brookings, Working Paper 12, June 2015. • Coibion, O., Y. Gorodnichenko, L. Kueng, J. Silvia, (2017), “Innocent Bystanders?

It is not part of our mandate. This is more effectively done by fiscal policy. I don’t believe any other central bank specifically takes this into account either. • But going forward, the Swedish parliamentary committee on finance has asked the Riksbank to evaluate the distributional effects of the expansionary monetary policy in recent years. So this is an area we are working on now and will continue to do so. • As the theme of this conference is “reshaping globalisation” I would like to end by adding some words about my views on the global perspective on equality and the possible explanations for increased inequality in many developed economies during recent decades. As I have said, the contribution from monetary policy to equality should in my view in general be minor. • I do not think you can talk about globalisation without also talking about technology. Some argue that increased inequality in many countries is due to the latest technological progress having been skills biased, resulting in a rise in the skill premium and the decline of some labour market institutions in advanced economies, emerging markets and developing countries 4.
In its turn, that would drive economic growth and drag down inflationary pressure inflicted by wage growth. Thereby, there is a set of structural measures which are not only important for the economic growth, but also may have a positive impact on inflation and, consequently, rate reduction in the economy. I would like to dedicate the second part of my statement to development of banking regulation and supervision and announce some important changes the Bank of Russia intends to introduce shortly. Let me begin with banking system challenges, the global developments affecting the Russian financial system and requiring new solutions. All over the world, the banking sector is going through a serious transformation in the aftermath of the latest global crisis: regulation has been tightened; capital burden has increased, making banks in many countries unattractive for investments. Despite soft monetary policies in the leading economies, the banking system is wary of boosting lending. Disproportionate regulation made parallel banking, including asset management, more attractive. Thereby, banks transfer risks to other market participants, though it is not always clear. Moreover, if banks give up certain activities following the new regulation, it may result in a loss of liquidity, among other things, in such an important sector as bond market. As a result, possibilities of bond offering shrink and the market becomes more volatile and exposed to shocks. Another challenge for the banking sector is a rapid fintech evolution that transforms relations between customers and financial institutions. New players (e.g., retailers) launch financial products and services.

I urge the industry to come together and focus on the long term benefits, and give its full support to initiatives such as ISM’s Fraud Intelligence System, and collaborate on other innovations such as the electronic reporting of motor accidents to bring the cost of insurance closer to its “true cost”. Such collective effort is critical to make insurance and takaful accessible to many, and to promote its sustainability over the long term. Individual insurers should also adopt the longer term view and invest in innovation. Much more can still be done by insurers that are part of global insurance groups to bring new technologies, product designs and process improvements into the Malaysian market. The undue focus on short term profitability driven at the group level have often come at the expense of certain market segments being underserved and customers being denied best value for money. Foreign insurers need to contribute more to justify their presence in the Malaysian market. Thirdly, insurers and takaful operators need to cultivate and continuously affirm society’s trust in the industry. Insurance and takaful products have become more complex with the result that most consumers do not fully understand what they have purchased. A larger number of players chasing the same pool of customers, result in intense competition that gives rise to poor sales practices. Pressure to improve underwriting results by controlling claims costs can also have unintended effects on the consumer experience.
We believe improving our credit provision infrastructure in this way can improve credit allocation and support firms to get the credit they need to grow, primarily by reducing information asymmetry between the creditor and the lender. Typically in the UK, it is only an SME’s bank that has ready access to the data needed to price a loan. This makes it difficult for firms to shop around and get the best rate. Our approach 4  All speeches are available online at www.bankofengland.co.uk/news/speeches  4  prioritises using technology to more accurately and competitively identify creditworthy borrowers, as a means to increasing aggregate credit flowing to SMEs. Open to changing the way we work  My third theme is the importance of the Bank of England being open to changing the way we work. Of course, it is not just the private sector who should be embracing change. We, as central banks, need to reflect on our own way of working. In particular, if we are going to regulate the digital economy effectively we will need to equip ourselves with appropriate digital tools. Central Banks ingest and analyse huge volumes of data in the course of our regulatory activity. This is necessary for our surveillance, but comes at a cost to the firms we regulate. The bill for regulatory reporting in the UK is estimated at between £ and £ a year. We want to leverage modern technology so that the way we collect and analyse data becomes cheaper, faster, and more effective.

It speaks volumes that the Group has focused its work in recent years on effective governance, the role of supervision, and on conduct and culture. Each of the four remaining panels will address one aspect of the multidimensional nature of cultural change. •  In the first panel, we will hear about engagement with employees – especially those who are skeptical of the benefits or practicality of reform. •  In the second panel, we will discuss accountability – not only in the sense of being “held accountable,” but also in the broader sense of promoting responsibility and stewardship. I am particularly interested in designing incentives – both the carrot and the stick – that yield conduct aligned with the public purposes of banking. •  The third panel will focus on skill development – particularly on recruiting and training as levers for sustained cultural change. •  And the last panel will focus on leadership and industry collaboration. A prime element of leadership, within a firm and across the industry, is character – behavior anchored in values consistent with the public’s legitimate expectation of trustworthiness. Our keynote speaker today is Christine Lagarde, the managing director of the International Monetary Fund. Christine Lagarde has been outspoken in her view that “financial leaders [must] take values as seriously as valuation, culture as seriously as capital.” 9 This makes abundant sense to me – culture and capital each promote financial stability. Thank you for joining us.
On this score, our experience has been fairly positive with a high level of residential construction in recent years. The tax system should treat investment in residential property neutrally and on a par with other investments. Several official studies in recent decades 7 – from Sekse to Skauge – have shown that the tax system favours residential property consumption and investment. This leads to overinvestment in residential property, displacing other types of investment. At the same time, the tax system makes it more advantageous to own a home instead of renting. Through the years, the tax on the advantage of homeownership has been gradually reduced. In 2005, it was removed. Tax deductibility of debt interest was maintained. In practice, this implies a housing investment subsidy. Homeowners benefit from an income deduction for expenses for income acquisition, but do not pay taxes on the income. In central areas where available sites are scarce, the tax advantage will result in a higher level of house prices. A more neutral taxation of residential property – for example as proposed by the Skauge Commission in 2003 – would also have a stabilising effect on the price level in the housing market. A tax that is based more on market values will increase when house values rise and fall when house values decline. This will curb the willingness to pay when purchasing homes during upturns and sustain it during downturns. The exemption for residential property tax is a source of more unstable house prices and credit cycles.

Rules or practices in Norway that diverge from other countries will influence the competitiveness of Norwegian-owned bank and is in practice hardly feasible. 12 Other countries will be of the same mind. It is therefore easy, particularly in an upturn, to be drawn into a negative spiral that culminates in a least common multiplier for capital requirements. It is my view that it is important to strengthen cooperation in this area, particularly between Nordic finance ministries and supervisory authorities. We must aim at a common approach to preventing systemic risk. 13 Nordic cooperation is already extensive, but primarily focuses on crisis management of a potential crisis in cross-border banks. Crisis simulation exercises with the participation of finance ministries, supervisory authorities and central banks – 15 participants from 5 countries 14 – illustrate that interests may easily conflict and that coordination is very  9  See Ordonez, M.F. “Speech by the Governor. 2008 International Monetary Conference – Central bankers panel, Banco de Espana, 2008. 10  See article in Financial Times, 4 June 2008, “ A party pooper’s guide to financial stability”. 11  See Kashyap, A.K., R. Rajan and J.C. Stein, “Rethinking Capital Regulation”, 2008. www.kansascityfed.org. 12  In 2006, the Financial Supervisory Authority of Norway recommended that the highest loan-to-value ratio for home mortgages with the lowest risk weight using the standardised approach under Basel II be lowered from 80 to 75 per cent of sound mortgage lending value. The Ministry of Finance did not follow the recommendation.
Aggregate cumulative UK impairment charges over the five years of the (a) stress Impairments in the stress (left-hand scale) Impairment rates in the stress (right-hand scale) Per cent 25  £ billions 20  20  15  15 10 10 5  5  0  0 UK mortgages  Sources: PRA regulatory returns, published accounts and Bank calculations. (a) Major UK banks’ core Tier 1 capital as a percentage of their risk-weighted assets. Major UK banks are Banco Santander, Bank of Ireland, Barclays, Co-operative Banking Group, HSBC, Lloyds Banking Group, National Australia Bank, Nationwide, RBS and Virgin Money. Data exclude Northern Rock/Virgin Money from 2008. (b) Between 2008 and 2011, the chart shows core Tier 1 ratios as published by banks, excluding hybrid capital instruments and making deductions from capital based on FSA definitions. Prior to 2008 that measure was not typically disclosed; the chart shows Bank calculations approximating it as previously published in the Report. (c) Weighted by risk-weighted assets. (d) From 2012, the ‘Basel III common equity Tier 1 capital ratio’ is calculated as common equity Tier 1 capital over riskweighted assets, according to the CRD IV definition as implemented in the United Kingdom. The Basel III peer group includes Barclays, Co-operative Banking Group, HSBC, Lloyds Banking Group, Nationwide, RBS and Santander UK. (e) CET1 ratio less the aggregate percentage point fall projected under the Bank of England’s 2016 annual cyclical stress scenario for the six largest UK banks.

And the rising level of consumer debt means it would be reasonable to expect greater losses on it in our future stress tests. That might mean the system has a bit more difficulty passing future tests. If that were the case, a further strengthening of the defence line would be needed. We have already, in recent months, taken steps to strengthen banks’ defences against losses by raising the capital buffers they are required to hold on all their lending. 12  12  That was achieved by increasing the ‘Countercyclical capital buffer’ that banks must hold against their UK-related lending, from 0% to 0.5% of risk-weighted assets, and expect to raise it further, to 1%, in November. 14  All speeches are available online at www.bankofengland.co.uk/speeches  14  And to make sure this defence line is kept robust in the face of rapid consumer credit growth, we are accelerating this year’s test of banks’ consumer credit loans. By September we will have assessed whether the rapid growth has created any small gap in the line. If it has, we’ll plug it. The third of our three defence lines is direct restrictions on high loan to income mortgage lending. Lenders should not extend more than 15% of their new loans at or above 4.5 times the borrower’s income. And borrowers are subject to an affordability test that effectively varies that loan to income limit for their 13  individual circumstances.