samchain/econo-pairs-v1 huggingface dataset:
10  This means that the required return on equity falls from 10% to 8.9%. 11  See Barnes et al (2008) “The elasticity of substitution: evidence from a UK firm-level data set”, Bank of England Working Paper. No. 348. 8  BIS Review 100/2010  Chart 6 Share of MFIs in UK PNFCs financial liabilities12 % 25  20  15  10  5  0 1987  1992  1997  2002  2007  Note: Monetary and Financial Institutions do not include insurance companies, pension funds and other financial intermediaries. Here, PNFCs financial liabilities are measured at current market value. This measure excludes PNFCs financial liabilities secured on dwellings which are predominately liabilities with MFIs and account for around 1% of PNFCs total financial liabilities. Source: Office for National Statistics, UK Economic Accounts.

For example, a “core” measure that relied exclusively on inflation in the services sector would have run above 2% in the pre-crisis era, when overall inflation was around 2%, in light of low inflation rates in goods prices. A “core” measure with a higher weight on goods prices would have shown the opposite. 22  For example, although they are uncertain, estimates of the pass-through of exchange rate movements to CPI inflation suggest that, on average a 1% appreciation reduces consumer prices by around 0.3%. Those effects take time, though they are mostly complete in around three years – consistent with complete but gradual passthrough of exchange rate changes to consumer prices. That likely reflects, among other things, rigidities in retailers’ pricing decisions. See the box on page 28 of the November 2015 Inflation Report for further discussion.
All this has resembled at times an economics version of Big Brother; indeed I expect the viewing economics community will ask next for the right, through a telephone poll, to vote members off the Committee! Occasionally the differences of view that surface in the Committee arise from different views about the workings of some economic relationship; on other occasions they represent a difference in tactical views. There is more than one interest rate path which would give an inflation profile consistent with the target. And so there can be differences between those who might at any moment prefer to wait and see - recognising that this might require a sharper movement in interest rates later on - and those who might prefer a more pre-emptive activist approach to setting rates, what might be termed the Macbeth School of Economics: “If it were done when ‘tis done, then ‘t’were well it were done quickly”. The fact that there are different paths to achieve the 2.5% target is one reason why there is no automatic link between our inflation forecast, which we publish on a quarterly basis, and that month’s interest rate decision. I mentioned that the setting of interest rates requires one to peer into the future. Unfortunately it is more difficult than that. It also requires policy makers to have a view about what is happening currently.

However, collective bargaining is still underway and it remains to be seen exactly how the results of this process will affect monetary policy. 10  BIS central bankers’ speeches  Figure 9. Rate of wage increases in line with the inflation target Annual percentage change and percentage of labour force  12  Unemployment, aged 16-64  12  Unemployment, aged 15-74 Average 2001-2011, unemployment  10  Wages  10  Average 2001-2011, wages  8  8  6  6  4  4  2  2  0  0 93  95  97  99  01  03  05  07  09  11  13  15  Note. Preliminary outcomes in the short-term wage statistics in 2011. The broken lines are the Riksbank’s forecast in February 2012. Sources: National Mediation Office and the Riksbank  Another relevant factor is that the rate of inflation measured in terms of the CPI has declined since the autumn. In August last year, CPI inflation was as high as 3.4 per cent. It has fallen significantly since then and in January the rate of inflation was just below 2 per cent. I expect, in line with the assessment in February, that CPI inflation will fall further in the period ahead when the interest expenditure of the households increases more slowly. Underlying inflationary pressures are also low in the wake of a strong krona and lower resource utilisation.
They consist, notably, of a reduction in governments’ debt financing needs, leading both to lower long-term interest rates (due to lower demand and declining risk premia) and to the release of revenues to finance more productive expenditure or growth-enhancing tax cuts. More leeway is then also created for the operation of automatic fiscal stabilizers in response to a cyclical downturn. In sum, fiscal consolidation is essential to secure public trust in the long-term sustainability of public finances, and to strengthen the foundations for sustained and durable growth. At the European level, fiscal consolidation should be in line with EU countries’ commitments under the Stability and Growth Pact, which provides the appropriate framework for the coordination of their fiscal policies. Given past experience of a slow and hesitant correction of excessive deficits, I see strong arguments for strengthening the implementation of the Stability and Growth Pact and reinforcing its rules for fiscal discipline. This could be complemented with enhanced national budgetary rules and procedures that are consistent with the EU fiscal framework. Monetary policy challenges Let me now turn to monetary policy and focus, in particular, on the response of the ECB to the crisis, and its current exit strategies. In response to the crisis and the ensuing subdued inflationary pressures, the Governing Council lowered its key interest rates to historically low levels. In particular, it reduced its main refinancing rate by 325 basis points to 1%, a level not seen in recent history in any of the euro area countries.

Arizona and California) have adopted a less prudent approach to the management of their public finances than others. BIS Review 51/2010  3  4  BIS Review 51/2010  There is no doubt that fiscal policies have been put on a path that is not sustainable. Indeed, as simulations for the euro area show, without a very ambitious fiscal adjustment effort, the debt ratio is projected to continue rising in the next decades. With an annual structural deficit reduction of only 0.5% of GDP, it will take the euro area 20 years or more to return to the pre-crisis debt-to-GDP level. Substantially stronger consolidation efforts are warranted to bring the debt ratio down to a more prudent level of below 60% of GDP and to prepare for the rising budgetary costs of the ageing population. BIS Review 51/2010  5  The challenges are particularly large for countries with relatively high government deficit and debt levels, as well as a rapidly ageing society, and even more so for those that face relatively high interest rates and low potential growth. Outside the euro area, bringing the public debt ratio back to safer regions appears even harder for the United Kingdom, the United States and Japan. Given their high budget deficits and the high and rising debt levels, they must undertake very strong consolidation efforts to manage a reversal of the rising trend in public debt ratios. Growing fiscal imbalances, if not promptly corrected, are a cause of concern for several reasons.
Under this, we are changing the education system to lighten the curriculum, encourage creativity, risk-taking and a spirit of life-long learning among our young. Second, we are setting up a $ billion venture fund to coinvest with the private sector in startups, whether by local entrepreneurs or foreign talent attracted to Singapore. Third, we are improving the physical infrastructure for start-ups, such as technology park facilities. And finally, we are reviewing existing laws and regulations, for example those governing taxation of stock options. A fourth area of change is the liberalisation of the financial sector. Our goal is to make Singapore a leading financial centre in our time zone, linked to other major financial centres of the world. Over the last two years, we have progressively shifted our philosophy on financial regulation to a lighter, more market oriented approach. We have given fund management companies greater access to domestic funds, including personal savings in the compulsory pensions scheme, and the government’s reserves hitherto managed by GIC and MAS. We are promoting the debt market, demutualising and merging the stock and futures exchanges, bringing corporate governance up to date, and introducing risk-focussed supervision and inspection of financial institutions. We are also allowing more foreign competition in the domestic banking sector. We have just issued new banking licences to foreign banks. Keener competition will mean better banking services and stronger local banks that can hold their own in a rapidly changing industry. While pursuing major economic priorities, we have not neglected to strengthen our social cohesion.

Turning to the monetary analysis, broad money (M3) continues to expand at a robust pace, with an annual rate of growth of 4.7% in February 2017, after 4.8% in January. As in previous months, annual growth in M3 was mainly supported by its most liquid components, with the narrow monetary aggregate M1 expanding at an annual rate of 8.4% in February 2017, unchanged from the previous month. The recovery in loan growth to the private sector observed since the beginning of 2014 is proceeding. The annual growth rate of loans to non-financial corporations declined to 2.0% in February 2017, from 2.3% in the previous month, while the annual growth rate of loans to households remained broadly stable at 2.3% in February. At the same time, the euro area bank lending survey for the first quarter of 2017 indicates that net loan demand has increased and bank lending conditions have further eased across all loan categories. The pass-through of the monetary policy measures put in place since June 2014 continues to significantly support borrowing conditions for firms and households and credit flows across the euro area. To sum up, a cross-check of the outcome of the economic analysis with the signals coming from the monetary analysis confirmed the need for a continued very substantial degree of monetary accommodation to secure a sustained return of inflation rates towards levels that are below, but close to, 2% without undue delay.
Even if short-term interest rates are zero or close to zero, bond rates at longer maturities may still be positive. If the central bank therefore buys long-term bonds it may perhaps be able to squeeze down the long-term interest rates somewhat, which should stimulate the real economy. The central bank can also promise to keep the policy rate at zero for a prolonged period in order to create expectations of lower future interest rates and a more expansionary monetary policy in the future. This should also stimulate the real  15  Bernanke, Ben (2002), “Deflation: Making Sure ‘It’ Doesn't Happen Here”, speech 21 November at the National Economists Club, Washington, D.C., www.federalreserve.gov. 16  As Paul Krugman put it in his insightful Brookings essay – how will the central bank "credibly promise to be irresponsible”. Krugman, Paul R. (1998). “It’s Baaack: Japan’s Slump and the Return of the Liquidity Trap”. Brookings Papers on Economic Activity 49, 137-206. 17  Quantitative easing and credit easing are not the same thing. The first method entails deliberately increasing the monetary base and having a quantitative target for this. The monetary base can then be seen as supplydetermined by the central bank. The second method consists of providing new loan opportunities for the banks in order to improve the functioning of the financial markets and reduce spreads. This method also results in an increase in the monetary base, but this can be seen as demand-determined by the banks.

Many observers criticised the Japanese central bank for having reacted far too slowly and for being too cautious about testing various methods to escape from their liquidity trap. I believe that we at the Riksbank should be prepared with analyses and measures at an early stage. Today I will therefore address the problem that a situation with a zero interest rate represents and the possible alternative solutions. I will, among other things, discuss a price level target and a method that in my research I have called the “Foolproof Way” of escaping from a liquidity trap. Finally, I summarise how effective the alternatives may be and how they can be selected depending on how serious the situation with a zero lower bound for the interest rate is deemed to be. In a situation with a zero lower bound for the interest rate, fiscal policy acquires a very important role. How effectively an expansionary fiscal policy can stimulate the real economy is, however, dependent on a number of factors, for example the degree of Ricardian equivalence – that is the extent to which a reduction in public saving gives rise to increased private saving. The initial size of the national debt, the structure of public expenditure and the distribution between expenditure increases and tax reductions in the national budget may also be decisive for the impact of fiscal policy on the real economy. Here, however, I only discuss monetary policy alternatives in the event of a zero interest rate.
The most narrow capital definition on the chart – the ratio of tangible common equity to tangible assets – has risen from a little over 2 percent to almost 6 percent. This reflects both significant raising of external capital as well as dramatic declines in dividends and stock buybacks during the crisis and the early period of recovery. Both of these dynamics have had a significant positive impact on the institutions’ ability to withstand potential future stresses. Figure 4 illustrates the amount and composition of capital – the numerators of the various capital ratios – at the 15 large banking organizations over a four-year period. You can see that there has been an appreciable amount of common equity raised by this group of large banks. The improvement in the quality and quantity of capital is quite striking. An important aspect of this recapitalization has been the supervisory use of stress tests to determine the adequacy of capital, and also in evaluating discretionary capital distributions (such as increased dividend payouts). The supervisory use of the stress tests is relatively new. It is worth noting and discussing the fact that it is not just capital regulation, but also supervision, that has been a driver of the recapitalization process. Stress tests and improving the quantity and quality of capital Now I would like to delve a bit deeper into the role that stress testing has played in encouraging more rapid recapitalization of U.S. banks, during the financial crisis and the early stages of the economic recovery.

Joseph Yam: Central bank authority, accountability, transparency and effectiveness Closing remarks by Mr Joseph Yam, Chief Executive of the Hong Kong Monetary Authority, at the BIS Meeting of the Central Bank Governance Network, Hong Kong, 18-19 November 2004. *  *  *  Braver people than myself have, earlier this morning, attempted to distil the multiple discussions that have taken place over the last day and a half. And they have all had the advantage of actually having attended the discussions. I shall not attempt to imitate them - though I should add that I have been keeping myself closely informed of your deliberations through the enjoyable discussions I have had with many of you in the margins. By all accounts, this has been an extremely fruitful meeting. Let me instead try to capture some of the themes and preoccupations which have figured prominently in discussions about central bank governance, and which will, I have no doubt, provide the impetus for further discussions within this network. These discussions tend to revolve around four interlocking and overlapping areas of concern: 1.  the sources of authority for central banks;  2.  the process of accountability within central banks, and, beyond them, to the larger body politic;  3.  the role and challenges of transparency; and  4.  the methods for achieving effectiveness in our operations through proper organisation and planning.
And of course, as we have found ourselves needing more data to do our job, banks have found themselves having to report not only more data, but also more granular data. We try at all times to be mindful of the 2/4  BIS central bankers' speeches  reporting burden that banks have to bear. Regular merit and cost procedures are applied to new data collections. More recently, we have started to hold public consultations on proposed new statistical reporting requirements. This will help to ensure all stakeholders have the chance to express their views. Cooperation also helps us to make reporting more efficient, which in turn reduces the burden on banks. And here, we have worked on two fronts. With the ESCB Integrated Reporting Framework, we aim to aggregate and harmonise banks’ reporting requirements. With the Banks’ Integrated Reporting Dictionary, the BIRD, we support banks in organising their data with a view to reporting it more efficiently. Towards this end, experts from national central banks work with experts from commercial banks to define the data and data transformations needed to comply with the reporting requirements for AnaCredit and the Securities Holdings Statistics. So, banks that choose to participate are being helped to do a job they would otherwise have had to do on their own. Cooperation with institutions beyond the ESCB has also been vital. The members of the ESCB and the European Statistical System partnership have worked closely to ensure the production of complete and coherent European statistics.

Big data has brought us tools and techniques that can be applied to rapidly process large sets of traditional data too. This makes it much easier for us to realise projects like MMSR and AnaCredit and helps us to keep pace with an ever-changing world. AnaCredit, for instance, involves immense sets of extremely granular data, reflecting the far greater complexity and interconnectedness of today’s economy. To understand this complexity and assess the interconnections, we need a very detailed view. And this is exactly what AnaCredit gives us. Thanks to the granular data it provides, we will be better able to understand what is driving credit growth, making it easier to know whether such growth is healthy or not. MMSR, on the other hand, is about speed: money markets move fast and never stop. So taking a snapshot every now and then does not suffice. We need much faster data, and that’s what MMSR provides. It allows us to constantly assess who lends how much money to whom in the money market and at what rates. This gives us a very clear and quick picture of how the market is structured, how exposed players are to one another and how vulnerable they are. And MMSR helps us to keep pace in other ways too. Look at the important role benchmark rates play. They provide anchors for contracts in financial markets and are important for the 3/4  BIS central bankers' speeches  transmission of monetary policy.
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William C Dudley: Remarks at the New York Fed’s Economic Press Briefing on the Household Debt and Credit Report Remarks by Mr William C Dudley, President and Chief Executive Officer of the Federal Reserve Bank of New York, at the New York Fed’s Economic Press Briefing on the Household Debt and Credit Report, New York City, 12 February 2016. *  *  *  Domenico Giannone, Andrew Haughwout, Joseph Tracy and Wilbert van der Klaauw assisted in preparing these remarks. Good morning and welcome to the Federal Reserve Bank of New York’s Economic Press Briefing. I am pleased to have this opportunity to speak with you today about the economic outlook, with a focus on the household sector. As always, what I have to say reflects my own views and not necessarily those of the Federal Open Market Committee (FOMC) or the Federal Reserve System. According to the National Bureau of Economic Research, the current expansion began in July 2009, making it nearly seven years old. If we gathered this expansion and the 11 prior post-WWII expansions together for a family photograph, arranging them by age from youngest in front to oldest in back, this expansion would be standing third from the rear. The only two that lasted longer were the expansion that began in February of 1961, which lasted for nearly nine years, and the one that began in March of 1991, which lasted for ten years. Thus, the current expansion is already an elder statesman in the family of post-war U.S. expansions.
In essence, pricing at penalty rates incorporates an exit strategy into the design of the programs. But while the various liquidity programs shared these features, they differed in other dimensions, and it is these differences that prompt questions about the future scope and design of liquidity facilities. A primary question is whether liquidity support during times of stress should be offered only to banks or to a wider set of financial institutions. We have a financial system in the United States that is heavily dependent on nonbank institutions in the extension of credit to firms and households. Indeed, as noted earlier, the amount of credit provided by the securitization market has rivaled that provided by banks. Moreover, nonbank firms in many cases are just as vulnerable to liquidity pressures and run-like dynamics as are banks. Accordingly, there may be benefits to having the central bank extend credit to both banks and nonbank financial intermediaries during periods of financial stress. The experience with the TALF suggests that nonbank lending efforts can be successful at restoring market functioning and the flow of credit to firms and households. A second issue is the extent to which the Federal Reserve should be flexible in setting the structure of its liquidity programs to meet the needs of the market. As noted earlier, the TALF did this in several ways, including its extension of the duration of the loans beyond the shortterm nature of most other liquidity facilities.

Luis de Guindos: Integration and convergence - from the peseta to the euro Remarks by Mr Luis de Guindos, Vice-President of the European Central Bank, at an event in honour of the 40th anniversary of the Spanish constitution, organised by the Spanish Ministry of Economy, Madrid, 18 December 2018. * * * This month marks 40 years since Spain began writing the most optimistic chapter of its history1. On 6 December 1978 the Spanish people did more than just vote in favour of a democratic country that would uphold the values of the rule of law and equality. Our support for the constitution also laid the foundations for Spain to modernise its economy and become an integrated part of the European family. In addition to safeguarding fundamental rights and civil liberties, Section 38 of the constitution states that “free enterprise is recognised within the framework of a market economy” and confirms that the public authorities guarantee its exercise. In practical terms, this meant Spain would align itself with the western model of parliamentary democracy, based on a market economy and free competition and underpinned by the social rule of law. A little more than a year later, negotiations began for Spain to join the European Economic Community, a historic milestone that would be achieved in 1986. But this wasn’t an easy road to follow.