samchain/econo-pairs-v1 huggingface dataset:
But as far as I can tell, there is a good chance that Switzerland will remain an island in the middle of the Euro-ocean for years to come! Experience shows, however, that the monetary regime itself is not a central issue for the existence and the development of a financial centre. Neither in the UK, nor in Switzerland is European monetary integration considered to be a necessary or a sufficient condition for a successful financial centre. In today’s global and very competitive markets, success relies more than ever on fundamental strengths and skills. Switzerland as a financial centre Since the early 1990s, international financial markets, along with the entire banking sector, have been undergoing profound changes. The driving force behind this world-wide trend is threefold: first, the advances made in the processing and the transmission of information; second, the trend towards the liberalisation of financial markets; and, third, the growing and increasingly diversified demand for financial services. These developments have led to a widening of horizons, to a proliferation of financial products, and to increasing international competition. Switzerland - thanks to its long tradition of openness to the world - was well prepared to face the challenges of global markets. But globalisation and world-wide competition did not leave our financial centre untouched. Consolidation has significantly altered the structure of the Swiss banking industry. During the 90s, domestic mergers and acquisitions have reduced the number of banks by about 40 percent.

Euro area governments need to step up structural reforms, in particular those which have the greatest efficiency gains given the relative distance to best practices.6 Policy-makers should pay due attention to ensure that the burden of the adjustment effort is shared fairly. The perception of fairness of reforms in the national context is a key ingredient in their success. Fighting tax evasion, rent seeking and corruption as well as increasing transparency are key examples. These efforts at the national level should be complemented by structural reforms at the European level, aimed at deepening the Single Market, the cement that holds all our economies together. This is particularly true of the Single Market for capital, where a lot can still be done to enhance both risk-sharing and allocative efficiency.7 Structural reforms at the national level could also go beyond the country-specific perspective in the areas of direct relevance for the smooth functioning of EMU. In these areas, convergence could be embedded in a binding European effort, based on benchmarks to be met by all euro area Member States. This process would be a race to the top and would close the gap to the frontier in terms of competitiveness and resilience. For this process to be fully effective and legitimate, it would have to entail the gradual pooling of sovereignty in these policy areas and be based on the Community method with due involvement of the European Parliament.
At the other end of the scale, we find bank owners – the shareholders. It seems reasonable, and in keeping with general perceptions of fairness, to allow shareholders to lose the equity they have paid into the bank when an insolvent bank must be taken over by the authorities. Moreover, allowing shareholders to bear losses will not result in the closure of the bank, since shareholders are not able to withdraw their capital. The current debate is focused on how creditors other than small depositors should be treated – the extent to which funding obtained in the market is to be guaranteed if banks fail. In this area, headway has been made in the years following the financial crisis, especially in Europe. However, how creditors can be made to pay when banks suffer losses – and exactly which creditors can be made to pay without triggering crises are not simple questions. To elucidate this, let me begin with Norwegian legislation as it currently stands. Guarantee Schemes Act It is barely 24 years since the largest banks in Norway were on their knees. On 17 October 1991, Finance Minister Sigbjørn Johnsen addressed the Storting (Norwegian Parliament) on the Government’s extraordinary measures aimed at the banking industry. By then the second largest bank, Kreditkassen, had lost more than its equity capital, and it quickly transpired that the other two large commercial banks were not in much better shape.

Ten years after Lehman Brothers, the financial system is now safer The crisis that followed the Lehman collapse demonstrated the importance of a sound financial system that could withstand shocks without hampering the financing of the economy. The economies that, after a macroeconomic shock, suffer a financial shock because their banking sector is too fragile, experience more serious and protracted crises. This lesson led to a vast reform programme of financial system regulation and supervision in order to address the many shortcomings that led to the development of significant vulnerabilities. 1.1 MANY OF THE SHORTCOMINGS IN THE REGULATORY AND SUPERVISORY FRAMEWORK HAVE BEEN REDUCED A comprehensive reform was thus carried out, covering practically all the areas of the financial system, focusing on four main areas:  (a) Shoring up the resilience of financial institutions For banks, under the impetus of the G20 and the Financial Stability Board (FSB), the Basel Committee has established new prudential rules, “Basel III", whose main features aim to enhance the level and quality of capital, limit the use of financial leverage and introduce new liquidity requirements. These rules must ensure that banks are able to cope with short-term pressures on their refinancing and regulate their transformation activity. Lastly, the framework introduces for the first time a “macroprudential” component, consisting of a countercyclical capital buffer and a surcharge for global systemically important banks (additional capital and leverage ratio). Most G20 jurisdictions have adopted this framework.
On the other hand, it would be less clear exactly how the valid objective is defined. In addition, it is difficult to foresee all the corrections warranted and to quantify their exact price effects. Finally, it is a problem that corrections of this kind are so highly dependent on the central bank’s own asessments, which can influence credibility negatively. 2. A closely related alternative is to use a measure of underlying inflation as target. Compared to the first alternative, it has the advantage of giving a clear definition of the BIS Review 56/1997  -9-  objective. It would, however, lead to difficulties similar to those of alternative 1 with respect to problems of defining and quantifying the effects of various disturbances. 3. Another possibility is to supplement the CPI by one or several measures of underlying inflation. In Canada the objective is expressed in terms of the CPI whereas a measure of the underlying inflation--which descibes the process of inflation better--is the operative target. In the long run, the final goal is reached since there is a clear link between it and the operative target. A ”softer” variety on the same theme is to clarify how practical policy is influenced by underlying inflation, since it can often give a clearer picture of the process of inflation.

In recent years, however, this sort of consideration has not played such a prominent role. There are several interrelated explanations for this. Monetary policy thus far has been aimed to a great extent at establishing a regime of low inflation and engendering understanding for it. In practice, the scope is also limited for monetary policy decisions of a fine-tuning character by the uncertainty that prevails, inter alia, about future developments and by the degree of credibility for the low inflation policy. 2. Uncertainty and Credibility There are various kinds of uncertainty that in practice play an important part in monetary policy and are also important for the speed and scale with which changes in interest rates are made: - One type of uncertainty has to do with the economy’s basic mechanisms.. Which model of the economy shall we use for our analysis? A major problem here in recent years has been that the shift to low inflation and a flexible exchange rate by itself can change the relationships in the model. - A second type of uncertainty concerns the interpretation of new information that is constantly coming in. It is important in this connection to assess what effects an interference or a shock have, which, inter alia, is linked with whether it is permanent or temporary. - Finally there is uncertainty about the effect of the measures that the Riksbank can take--in practice, changes in the instrumental interest rates.
On that basis, the euro-area would have no reason -- and certainly no right under European legislation -- to seek to act in any discriminatory way. Indeed, it would be economically damaging to both sides if it were to do so. I have no serious concerns on this score. Assuming, as I do, a continuing responsible and constructive relationship -- which, as I say, would clearly be in our mutual interest -- it seems to me that some of the concerns that are occasionally expressed, for example, about the possible loss to the UK of internationally mobile investment, are exaggerated. I would suppose that, in the future as in the past, investment will be located wherever it is expected to earn the highest return -- indeed I would suppose that shareholders would insist that this be the case. And while exchange rate uncertainty may be a factor in such decisions, it is not at all clear that it is likely to be the decisive factor very often, when set, for example, against the whole range of supply-side influences, including labour market flexibility. Similarly, in relation to concerns about the future of the huge UK financial services industry, the reality is that financial activity will be carried on wherever it can be carried on most conveniently, efficiently and profitably. And in this case, too, the question of whether or not the UK is part of the single currency is unlikely to be decisive.

Mr. George discusses the advantages and disadvantages of EMU Speech by the Governor of the Bank of England, Mr. E.A.J. George, to the British Chamber of Commerce in Hong Kong on 23/9/97. EMU - One currency, fifteen countries? Thank you, Chairman. I am delighted to be here with the British Chamber of Commerce in Hong Kong, and to find that you are so obviously flourishing -- as I had no doubt you would -- in the new environment. I’m delighted too to be able to redeem a promise to speak at one of your lunches which Christopher Hammerbeck alleges I made to him two years ago. I’ve chosen to speak about EMU -- under the title of “One currency, fifteen countries?” -- and I emphasise the question mark. Let me begin with the pros and cons of EMU, although I think that the economic arguments are now reasonably well understood. On the positive side, although one can hope, by pursuing consistent national macroeconomic policies, to achieve reasonable de facto exchange rate stability within Europe over time, only a single currency can deliver intra-European exchange rate certainty. And exchange rate certainty within a large market area is, of course, a very considerable prize. I don’t think one can go so far as to argue that a single European currency is a necessary complement to the European single market -- any more than one can argue that exchange rate fixity is necessary to achieving benefits from free trade internationally.
We are now looking at that question and have an open mind on it. But in a way the more interesting thing the robot brought back to us was not these findings, but simply a clearer picture of what the gradient is for small firms which we are therefore publishing today for the first time. Here it is: Chart 1a: Thresholds in UK prudential regulation, translated onto an assets/deposits basis (deposit-takers)  4  All speeches are available online at www.bankofengland.co.uk/news/speeches  4  Chart 1b: Thresholds in UK prudential regulation, translated onto an assets/deposits basis up to £ (deposit-takers)  Sources: CRR, BCBS, EBA Technical Standards, PRA Rulebook, Supervisory Statements, and Statements of Policy. Note: Only includes thresholds that are either set using assets/deposits values, or can be translated into assets/deposits values. Assumes average size of transactional accounts of £ The y-axis corresponds to the number of thresholds below the £ value for assets/deposits on the x-axis. I’d like to know what people think about this gradient. To me, the basic gradient looks OK. It feels about right that most of the carve-outs are for firms below £ in assets – once you reach that size, you are a fair-sized bank in a UK context and should expect to meet the great bulk of the rules. And within the £ area the slope does not look particularly troublesome.

The report by the Task Force was completed in April this year and highlights eight building blocks to strengthen the financial infrastructure of Islamic finance, drawing also on important lessons learnt from the global financial crisis. The building blocks include first, ensuring the effective implementation of prudential standards; second, the development of robust liquidity management infrastructure; third, the establishment of strong financial safety net; fourth, having in place an effective crisis management and resolution frameworks; fifth, further strengthening of the accounting, auditing and disclosure standards; sixth, putting in place an effective macro prudential surveillance; seventh, having credible credit rating institutions and processes; and eighth; enhancing close international cooperation and coordination among countries, which includes capacity building and talent development. The report further recommends the establishment of an Islamic Financial Stability Forum (IFSF) based at the IFSB as a strategic platform for productive dialogues to promote financial stability in the Islamic financial system. The IFSF would be an important institutional  BIS Review 129/2010  3  arrangement for the Islamic financial system to interface with the conventional system via the Financial Stability Board. With the growing significance of Islamic finance in the international financial system, this is critical to constructive dialogue and promotes a comprehensive approach in efforts to strengthen global financial stability. Concluding remarks Let me conclude. The recent international financial crisis has been a defining event in economic history and its effects will likely cast a long shadow over policymaking in the coming years.
The requirement is primarily prudential in nature. It was among other things aimed at reducing the reliance of domestic credit institutions on foreign short-term capital to finance their domestic lending activities which had risen sharply, but has subsequently diminished markedly. Low inflation and macro-economic stability was only achieved in the early part of this decade. Consequently, it is not at all surprising that we have to maintain interest rates that are significantly higher than among our main trading partners. The required difference is variable over time, depending among other things on the credibility of economic policy, relative cyclical positions and so on. The current differential is the widest since capital movements were liberalised and is of course explained to an important extent by the very different cyclical position of the Icelandic economy from that of most of our trading partners, not the least in Europe. It also entails the cost of maintaining an own currency, i.e. a premium for the availability of the exchange rate as an instrument. 1  BIS Review 117/1999  In this connection, I should also note that since the opening up of the capital account of the balance of payments, long-term interest rates, which used to be very high by any comparison, have been on a downward trend despite repeated increases in short term rates. This is not surprising and reflects a narrowing of long term interest rate differentials between Iceland and other countries towards a much lower level than prevailed before capital movements were liberalised.

The answer to this question clearly has an important bearing on the broader normative questions some have posed about the role of central banks. I begin by explaining why I think distributional issues are relevant to central bankers and to policymakers generally. This is not always agreed territory. I will then set out a framework for assessing the quantitative impact of monetary policy on different cohorts of society. This is done in both standard units of measurement (money amounts and percentages) and in non-standard units (welfare and well-being). This framework is calibrated using as a case study the loosening of UK monetary policy after the global financial crisis. The main results are easily summarised. There is nothing to suggest monetary policy has had significant effects on either income or wealth inequality in the UK over recent years. Indeed, the 4  QE calculated with reference to combined purchases by US, UK, euro-area and Japanese central banks between start-2007 and end-2017. 5 Bank of England and NMG survey (2017). 6 For example, Lysenko et al (2016) and Altmann (2009). 7 For example, Buiter (2014). 8 See Bank of England ‘Independence 20 Years On’ conference: https://www.bankofengland.co.uk/events/2017/september/20-yearson 3  All speeches are available online at www.bankofengland.co.uk/speeches  3  loosening of monetary policy after the crisis appears to have delivered significant financial and welfare benefits to almost all cohorts of the UK economy, albeit often through different channels. I conclude with thoughts on the implications of this analysis for policymakers.
This has taken place in a global environment in which the world economies and financial systems are increasingly becoming more integrated. As a result, it can be expected that there is increased interdependence, events that take place in one part of the world will have implications on other parts of the world. This is likely to be more pronounced in the ASEAN economies and financial systems, given their openness and their high degree of integration with the global economy and international financial system. As the ASEAN and the EU continues to evolve as strategic partners, new opportunities can also be realized. An enhanced relationship will also contribute towards more effective management of the new challenges in the ever-changing global environment. Indeed, this Conference takes place at an important time when it becomes even more constructive and meaningful for our two regions to strengthen our associations, our inter-linkages and our relationships. Learning from the experiences of the EU Ladies and Gentlemen, The unification of Europe on many fronts is a major structural enhancement to the global economic and financial landscape. It is very likely however, that in view of our diversity and different structures and stages of development, the route for the integration process will be significantly different. It can be stated with certainty however, that integration will nevertheless occur. Indeed, the process has already commenced and it is likely to gain momentum as we advance forward. The motivation being the greater stability it brings and the increased growth potential it generates.

The European experience offers valuable insights in synchronising and pacing the integration process in the ASEAN region. The European path to integration -- based on trade integration, with the removal of restrictions on the movements of goods and all factors of production at the early stages, followed by increased monetary and financial linkages at the subsequent stages - presents ASEAN with an important reference point in our own monetary and financial integration efforts, in particular, in relation to the trade and investment liberalisation initiatives to facilitate greater regional economic integration. 1/2  Tremendous opportunities in ASEAN for the EU There is certainly much that ASEAN can learn from the EU experience. The EU is now the world's largest single market and with the introduction of the Euro. The EU has become the ASEAN's third largest trading partner. Of its total trade, the trade of the ASEAN 5 (that is, of Indonesia, Malaysia, the Philippines, Thailand and Singapore as a group) with the EU accounted for 12.4% in 2004. Meanwhile, the EU's trade with the ASEAN 5 accounts for 4.5% of the EU's total trade. Against a backdrop of sustained growth and macroeconomic and financial stability in ASEAN, there is significant potential for expanding the trading and investment links between our two regions. Focusing on the areas of complementarities would maximize the mutual benefits to be gained from the strengthened relationship.
In the public domain, however, their responsibility should be to illustrate potential economic consequences of the ultimately political decision to join or not to join the European Monetary Union. Conclusion Ladies and Gentlemen, the decision formally to join EMU does not appear to be a policy issue of imminent concern in either of our two countries. In the United Kingdom, the issue was indefinitely pushed back in time in June of last year. Here in Switzerland, it is the ratification of the second package of bilateral treaties with the European Union that dominates our current external political agenda. Since this contractual arrangement with our European partners was designed from the outset as a multi-issue legal document with costs and benefits spread over multiple issues, the Swiss government is to be commended for insisting on negotiating the agreement as a comprehensive package and not break it down into multiple single issues. Meanwhile, globalization is set to proceed. With the rapid integration of China and India into the global economy and the subsequent reorganization of production processes, global competition is rapidly increasing with changes in relative prices that become increasingly a function of global demand and supply. Needless to say, the globalization path will neither be linear nor smooth. There are risks, perhaps none less so than the temptation of governments to resort to protectionism in a misguided effort to respond to the costs associated with global economic integration. In Europe, integration is also proceeding. In less than a week, ten countries will join the European Union.

Based on these commonalities and differences, I will then draw some tentative economic, financial and political conclusions about the respective experiences and relations of our two countries with Europe and more specifically with EMU. UK and Switzerland: Common features and differences: It seems to me that even a perfunctory comparison of our two countries’ relations to Europe and EMU needs to touch upon law, politics and recent economic history. Law and politics There is a fundamental judicial divide between the common law tradition of Anglo-Saxon countries and the civil law tradition of Continental Europe. Over the centuries, this divide has undoubtedly spread into culture and minds. The custom and case-based common law was institutionalized in 1154 by Henry II through elevating local custom to a unified system of law “common” to the country. It may be unwritten, as it was at the outset, or captured in statutes and codes. This judicial history is reflected by the absence of a written constitution in the United Kingdom. Civil law in Continental Europe, on the other hand, has its roots in the Corpus Juris Civilis of Emperor Justinian. It constitutes broad legal principles and doctrinal writings and is explicitly written law. This explicit and written tradition is reflected in the “acquis communautaire” of the European Union with nearly 100’000 pages and some 20’000 laws, decisions and regulations.