samchain/econo-pairs-v1 huggingface dataset:
I maintain that all the measures taken during the pandemic include elements of both monetary policy and financial stability. Sweden has been a member of the EU for a long time and, like other Swedish authorities, the Riksbank must somehow relate to what happens and what applies in the EU. Other central banks in the EU have the right to far-reaching purchases of various securities for monetary policy purposes. It would therefore be strange to have national legislation giving the Riksbank a markedly different toolbox to what could be argued is the standard in the EU. In addition, the Inquiry’s proposals mean that certain measures may only be adopted under extraordinary circumstances. Such proposals are in sharp contrast to the flexibility central banks have needed to show over the last ten–fifteen years to manage shocks that few could have predicted. One critical issue concerns how much we believe (or fear) that the balance sheet will also have to be used under more normal circumstances in the period ahead. As I am one of those who believes there is a great probability that this will be the case, and who does not see the point of giving monetary policy a narrower interpretation than has been normal from a historical perspective, I do not consider it reasonable to introduce the type of restrictions that the Inquiry advocates. Accessible foreign exchange reserves provide security in crises As regards the matter of an appropriate size for the foreign exchange reserves, I have two comments.

If reintermediation is significant, banks will be taking back on to their balance sheets conduit and investment vehicle paper or just holding onto loans for longer than usual before they can be sold onto the capital markets. 19  Perhaps nothing illustrates this as cleanly as the advent of credit derivatives. Derivatives of any kind unbundle funding (and so liquidity risk) from the underlying risk to which an agent is seeking exposure via a particular contract. So a credit derivative unbundles credit risk from funding. This further complicates interpretation of the bank lending data (M4L). Imagine that, due to their customer networks and screening capability, banks originate all credit, but that they use credit-default swaps to shed a great portion of the credit risk via CDS to non-bank financial institutions. In the limit, this would be a world in which M4L correctly measured (bank) lending and M4 was one useful measure of “liquidity”. But it would also be a world in which shocks to credit conditions from capital and risk appetite worked largely through non-bank lenders, and in which shocks to liquidity worked largely through depositor confidence in the banking system. In the real world, this story underlines the need to look at total credit, and to analyse the monetary data with finesse. 20  See Bank of England Inflation Report, November 2007, Section 1 on “Money and Asset Prices”, pages 16-17.
Philipp Hildebrand: Economic situation and monetary conditions in Switzerland Introductory remarks by Mr Philipp Hildebrand, Chairman of the Governing Board of the Swiss National Bank, at the half-yearly media news conference, Geneva, 17 June 2010. *  *  *  The Swiss National Bank (SNB) is maintaining its expansionary monetary policy. Consequently, it is leaving the target range for the three-month Libor unchanged at 0.00–0.75% and intends to hold the Libor in the lower part of the target range, at around 0.25%. The recovery of the global economy continues and the Swiss economy is benefiting from it. Although the weakening of the euro with respect to the Swiss franc is dampening export activity, this activity is being supported by growth in foreign demand. The domestic sector is still performing favourably. For 2010, the SNB is now expecting real GDP growth of about 2.0%. In view of these pleasing developments, the deflationary risk in Switzerland has largely disappeared. At the same time, uncertainty has increased since the last monetary policy assessment. The latest tensions on the financial markets, particularly with regard to the public finances of some individual countries, have increased the downside risks. Should these downside risks materialise and, via an appreciation of the Swiss franc, lead to a renewed threat of deflation, the SNB would take all the measures necessary to ensure price stability. The SNB’s conditional inflation forecast for 2010 and 2011 has increased slightly since March. It remains unchanged for 2012.

Since last winter a “Monetary Policy Update” is published on these occasions, a report which contains a more limited number of forecasts. On the basis of the work described above, the Executive Board establishes its majority view of what is considered a well-balanced monetary policy, giving consideration to inflation and the developments in the real economy during the forecast period. Last Wednesday we published the first Monetary Policy Update of the year. We observed in this report that the financial turmoil has persisted since the monetary policy meeting in February. It has contributed to subduing households’ and companies’ expectations for the future in many countries. At the same time, energy and food prices have risen more than expected. All in all, this means that international economic activity is showing weaker development than the Riksbank had earlier anticipated. Economic activity is still good in Sweden, with high growth in consumption and employment. Exports have also shown good growth. The weaker international economic activity will contribute to a slowdown in the Swedish economy. Rising energy and food prices mean that inflation is high and it is expected to be slightly higher next year than was forecast in February. As before, the Riksbank has to take into account different counteracting factors. On the one hand, inflation is still high, as are inflation expectations. On the other hand, the increasingly weak international economic activity will have an effect on Swedish growth and inflation.
Some disconnection between the valuation process – which should remain anchored on market prices – and income and profit recognition will have to be introduced, if only to account for risks which are there but have not yet materialized. Dynamic provisioning is one technique for doing so, when risks are closely related to the economic cycle. Valuation reserves may also be used when complexity or illiquidity creates additional risk linked to valuation. Provided those adjustments are rule based and made in a fully transparent process, they would not reduce the quantity or quality of information available to investors as to the real health of financial institutions. Another avenue for research would be for the regulatory system to "force" the pricing of risk in all its dimensions. There is a clear analogy with tax theory: internalizing the risk eliminates market failures. This approach would be best implemented to liquidity risk linked to maturity transformation. Quantitative liquidity ratios are currently considered in a number of juridictions to be imposed on financial institutions. However, they may not protect the system against an aggregate liquidity shock, when, by definition, the demand for liquidity becomes infinite and any buffer proves insufficient. Pricing liquidity ex ante in the system would reduce the probability of such a shock and create incentives against relying too much on maturity transformation. Admittedly, the conceptual challenges in quantifying, for instance, liquidity risk, are enormous. But we live in a world of second best, and even very approximate measures would do better than nothing at all. Thank you.

The use of data with superior software will enable financial services to be unbundled and increasingly custom-made for individual consumers. Data will enable increased transparency and better assessment of credit worthiness as well as reduction of risks, thus extending financing to previously underserved segments of society. The third observation is that finance may display ‘winner takes all’ characteristics over the long term. This characteristic is apparent in Silicon Valley and the digital economy in general. Market leaders such as Google and Facebook control over two-thirds of the market. This is due to ‘network effects’, where a service becomes more valuable when it has more users. What is also worrying is the value that the market attach to these network effects. We have seen staggering valuations of tech-startups, the so called “unicorn companies”, that sometimes have not even realised any meaningful profits. However, their large user base and ability to scale up quickly have resulted in frenzied valuations. It is as if the world has forgotten the dot-com bubble crash of the early 2000s. For financial regulators, a winner takes all outcome is not ideal. It is associated with concentration risks and “too-big-to-fail” issues. Concentration of risks and dependence on too few service providers never ends well. The only consolation I can think of is that “network effects” in the digital economy are not as durable as those found in traditional sectors such as railway networks and power grids.
Indeed, there are important potential benefits and scale effects that can be reaped from the realisation of the electronic payment agenda for individuals and businesses, as well as for the economy as a whole. Thus, it is for all these reasons that Bank Negara Malaysia has made the migration to electronic payments as one of its strategic results. While the acceptance of electronic payment is on the rise in Malaysia, with electronic payment per capita doubling from 23 in 2005 to 41 in 2009, cash and cheques are still largely popular. Hence, resource intensive and time consuming processes continue to exist in the payment value chain. As electronic payments are more economical for the society and, as  BIS Review 69/2010  1  part of the broader efforts to enhance Malaysia’s long term national competitiveness, it is essential that costs arising from these inefficiencies are eliminated. An area that requires more attention moving forward, is the change in customers’ behaviour and mindset. Undoubtedly, it takes time and energy to withdraw cash, deposit cheques and reconcile cheque payments. However, there are segments of society who still prefer paper as they are so accustomed to paper and have always trusted paper instruments. Thus, one of the greatest hurdles to accelerate the adoption of electronic payments is breaking longstanding habits and changing the behaviour of people. Another important aspect in promoting greater adoption of electronic payments is the need to strengthen consumer confidence in the safety and security of the payment mechanism.

Encik Abdul Rasheed Ghaffour: ASEAN - advancing its potential, hurdles and the way forward Closing remarks by Mr Encik Abdul Rasheed Ghaffour, Deputy Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the Conference, Kuala Lumpur, 4 August 2017. * * * Thank you for having me here today to deliver the closing remarks for the ASEAN@50 Conference. I am also honoured that you have chosen Sasana Kijang to be your meeting point for this Conference. I’m sure that all of you have greatly benefited from the two thought-provoking panel discussions earlier, that drilled down the measures required for ASEAN to achieve its economic promise. ASEAN proudly welcomes its golden jubilee next week. This momentous occasion not only celebrates our achievements thus far, but also marks the gravity of the work ahead of us. We will continue to galvanise all sectors of society – public, private and civil – to ensure ASEAN’s achievements are not just reflected on paper, but more importantly, can be seen, felt and heard. ASEAN stands out as a dynamic region – with diverse strengths that continues to benefit its growing population of 625 million people. In 2015, ASEAN contributed to more than 7 percent of world exports. Our strong trade performance has contributed to increased employment by about 70 million over the past 17 years – enabling better livelihoods of households. Millions have been lifted out of poverty with the significant rise of ASEAN’s GDP per capita, from USD1,054 in 1996 to USD4,000 in 2016.
After all, adjustments to the balance sheet are in many respects a substitute for changes in the federal funds rate. Both instruments attempt to influence broader financial conditions in order to achieve a desired economic outcome. However, the way in which the FOMC implemented asset purchases differed in important ways from the manner in which it has historically adjusted the federal funds rate. With this contrast in mind, I raise a set of policy questions that could be considered in designing a purchase program. First, should the balance sheet be adjusted in relatively continuous but smaller steps, or in infrequent but large increments? The earlier round of asset purchases involved the latter approach, which caused the market response to be concentrated in several days on which significant announcements were made. That might have been appropriate in circumstances when substantial and front-loaded policy surprises had benefits, but different approaches may be warranted in other circumstances. Indeed, it contrasts with the manner in which the FOMC has historically adjusted the federal funds rate, which has typically involved incremental changes to the policy instrument. Second, how responsive should the balance sheet be to economic conditions? Historically, the FOMC has determined the federal funds target rate based on the Committee’s assessment of the outlook for economic growth and inflation.

However, the analysis is less urgent in other countries, where they have not experienced the same rapid decline in the use of cash. While the value of outstanding cash as a percentage of GDP is just over 1 per cent in Sweden, it is 10 per cent in the Eurozone and a good 20 per cent in Japan. Our Nordic neighbours are also conducting similar analyses because of a decline in the use of cash. Norway and Denmark, for instance, have produced reports and analyses on digital central bank money. The Bank of England and the Bank of Canada have published research articles in this field that analyse, for instance, possible motives for central bank digital currencies and their consequences for monetary policy and financial stability. 6 Central banks in some emerging market economies have also shown an interest in central bank digital currencies. These countries’ motives for being interested in central bank digital currency differ somewhat from our own. One motive is that they see the opportunity to broaden access to fundamental financial services to all parts of the population, that is to say, financial inclusion. Other arguments concern reducing the use of cash, which may be regarded as costly and risky. They also point to the negative environmental aspects of cash and to the fact that it enables money laundering and makes it easier for the black economy. 7 The work that is done is not solely theoretical.
William J McDonough: Promoting financial resilience Remarks by Mr William J McDonough, President and Chief Executive Officer of the Federal Reserve Bank of New York, at the Cato Institute’s 20th Annual Monetary Conference on “International Financial Crises: What Role for Government?” cosponsored with The Economist, New York, 17 October 2002. *  *  *  •  Good morning. It is a pleasure to have the opportunity to join you on the occasion of this timely conference, and to share with you my thoughts on promoting financial resilience. •  Despite the fact that periodic surges in volatility are a fact of life in financial markets, I think there is general acknowledgment that recent years have been extraordinary in this regard. This has been a period of historic change and remarkable volatility in markets, going well beyond the emerging markets, and carrying with it important implications for political, social, and institutional stability in significant segments of the globe. •  The experiences of recent years have reinforced old lessons and brought home new insights about maintaining financial stability and sustained growth. In particular, a broad consensus continues to develop on ways of strengthening the institutional framework at the national and international level to create more robust, and thus more crisis-resistant, economies. There is general agreement that in order for countries to enjoy sustained and stable growth, the following are crucial: G  a sound and stable macroeconomic environment, and  G  well-functioning and robust financial systems in both capital-exporting and capitalimporting countries.

In recent decades, however, growth in Norway and many other countries has slowed. 3/9  BIS central bankers' speeches  Chart: Norwegian productivity growth Since 1980, average productivity growth in Norway, as measured by growth in GDP per hour worked, has been only around one-third of what it was in the first decades after the war. One explanation is that we have invested less. Increased use of machinery and other real capital per worker long helped make labour more efficient, but since 1980 the contribution from capital has been smaller. With low investment in the business sector over several years, there is the prospect of a further decline in the contribution from capital. There is probably also less to be gained from raising education standards. If we go back a few decades, the potential was considerable. In 1950, seven in ten Norwegians had only seven years of compulsory schooling. Today, a similar proportion has at least completed upper secondary education, and around one-third have a university education. Those entering the labour force continue to be better educated than those retiring from it. This may provide a boost to productivity. But we cannot expect the same return on higher education standards as in previous periods. Productivity growth that cannot be explained by increases in real capital or education standards is what we economists call total factor productivity, or TFP. Technological progress, better organisation of work and gains from labour mobility across industries are key factors behind TFP growth.
Beaucoup de réflexions actuelles  Page 7 sur 14 en France – dont celles récentes de la commission Arthuis – avancent le principe d’une telle norme de dépenses, à juste titre. Mais il faudra en fixer le niveau, ce qui relève du débat démocratique : les exemples chiffrés que je viens de citer peuvent l’éclairer. C’est un objectif exigeant mais accessible : nombre de nos voisins européens y sont parvenus. B. Our macroeconomic policies? The lack of macroeconomic policy coordination has long been the “usual suspect” for the weakness in our economic union. This was true during the euro crisis: monetary stimulus, whether powerful enough or not, was not sufficiently supported by fiscal policy, which was tightened too early. This lesson has not been forgotten in this crisis. Along with my colleagues on the Governing Council, I personally will never forget that night of March 2020 when, locked down in our homes, we took, in less than three hours, some of the strongest measures in the history of the euro, creating our now almost famous PEPP [Pandemic emergency purchase programme]. On the fiscal front, with its Next Generation recovery plan of EUR 750 billion, financed by a shared debt instrument, the European Union demonstrated an unprecedented level of solidarity towards the countries most affected by the Covid crisis. Monetary policy is no longer the only game in town, and Europe has reacted appropriately over the past year.

Furthermore, while the reserves are expected to intermediate capital flows in the short run, we must not forget that the floating exchange rate framework is an important adjustment mechanism that can buffer volatile capital flows. Lastly, Malaysia’s external debt cannot be judged based on the aggregate level alone. Onethird is denominated in ringgit and is not subjected to valuation changes from exchange rate movements, limiting the risk of currency mismatches. The remainder are subject to prudential management and hedging requirements. What is more important is that more than half of the total external debt is skewed towards medium- to long-term debt, while shortterm debt poses limited claims on reserves. Taking all these factors into consideration, Malaysia’s external debt remains manageable. As we can see, the reality is far different from the perception. It is important that conclusions are made based on facts rather than perceptions and sentiments. Without us delving into the details and without the availability of critical information, the probability is high that our perception and sentiment would be inaccurate. Because of this ‘reality gap’, the central bank needs to show its presence in the market when it is needed. Part III – Ringgit Exchange Rate and Interventions For this reason, interventions by central banks on the odd occasion becomes necessary. Interventions can take different forms. Many of you may focus on market or operational interventions. Indeed, this is important to ensure the market has sufficient liquidity in stressed conditions.