samchain/econo-pairs-v1 huggingface dataset:
BIS Review 11/2003  7  Two points of particular relevance for the financial regulatory framework Let me conclude on this important topic by stressing two points of particular relevance for the European financial regulatory framework: •  There are still some barriers to further integration of EU capital markets. In this regard, the Eurosystem welcomed the objective of the European Council meeting in Lisbon in March 2000, to accelerate completion of the internal market for financial services, and to set a tight timetable so that the Financial Services Action Plan can be implemented by 2005. This Plan is regularly reviewed by European authorities, and progress is being made. •  The Eurosystem also supports the strategic conclusions of the Committee chaired by A. Lamfalussy on the integration of the European securities markets, ratified by the European Council meeting in Stockholm in 2001 and approved by the European Parliament in early 2002. We are convinced that the implementation of these broad guidelines and the new cooperation structures at the European level will help make it possible to take full advantage of the introduction of the euro. •  In the field of financial regulation and supervision, ECOFIN Council (December the 3 2002) approved a report by the Economic and Financial Committee which made proposals concerning the cooperation structures at the European level for financial regulation and supervision. These new arrangements are now being implemented.

All in all, this recent recommandation from the Governing Council is testimony to its ability to smoothly adapt its internal governance to the challenges posed by enlargement. Strategy of the single monetary policy The Maastricht Treaty clearly defines the ultimate objective of the single monetary policy, that is to say maintaining price stability. However, for attaining this goal, it is essential to clearly define price stability: we define it as a year-on-year increase in the overall Harmonised Index of Consumer Prices (HICP) of below 2% in the whole euro area. Bearing in mind this objective, our monetary policy strategy is based on two “pillars”. We have first assigned a key role to the monetary aggregate M3. This “pillar” is based on a reference value which is set at 4.5% for the annual growth rate of the broad monetary aggregate M3. The concept of a reference value does not mean that the Eurosystem is committed to automatically correcting deviations in monetary growth in the short term. Naturally, we also follow the components and counterparts of M3 closely. In this regard, the development of loans to the private sector, as well as the evolution of government finance and capital flows with the rest of the world, deserve a particular attention. However, it is common sense to say that monetary developments do not account for all the risks to price stability.
It will be a difficult and complex process, and we should all ideally pull together for the benefit of the whole of the Spanish economy. Thank you. BIS Review 43/2009  7

Traditional institutions and conventional policy-making have less influence than before. This calls for a new approach to governing and policy making, one that combines high-level strategic clarity with experimentation and dynamic implementation at a micro level. Since 2000, the Government has produced 39 blueprints, roadmaps and master plans, including the Financial Sector Blueprint. This is more than double the number of master plans introduced between 1970 to 1999. From a different perspective, over the last 17 years, the country introduced two blueprints a year, compared to only one plan in every two years during the period 1970 to 1990. There is no denying that the plans have laid a great foundation for the nation to move forward. Indeed, the Economic Transformation Plan played a catalytic role in spurring, what we at the Bank like to refer to, as the Investment Renaissance period between 2011 and 2014. Going forward, there is a critical need to overlay these existing master plans and blueprints with micro-cellular transformations. We have been advocating this approach at every opportunity available. It is just as relevant for industry, including the banking sector. Very often, implementation pitfalls caused the failure of the strategic vision of leaders. I believe this gap can be bridged if each component, layer, and cell, within the ecosystem, whether at an institution or 5/6  BIS central bankers' speeches  industry level, is empowered to support and even lead transformation.
In practice, however, there is already a substantial insurance “protection gap”. Only one-third of climate-related economic losses in the euro area are currently insured, a situation that could worsen with climate change. More frequent and severe natural disasters are likely to increase insurance claims, which may result in higher insurance premiums and potentially lead to lower insurance coverage, further widening the protection gap. [6]  Green finance as a driver of financial integration A substantial amount of finance will be needed for there to be a smooth transition to meet the ambitious goals for a carbon neutral economy. But we also need a robust financial system capable of maintaining the flow of credit even if asymmetric shocks happen or if the transition is a little bumpy. That brings me back once more to the importance of financial integration. Progress has certainly been made in stepping up sustainable finance. Since 2015, the assets under management of environmental, social and governance (ESG)[7] funds have almost tripled, the volume of outstanding green bonds has risen tenfold, and the amount of catastrophe bonds has almost doubled (Chart 3, left panel). Chart 3 Investments in ESG funds  Sources: Artemis, Bloomberg Finance L.P., EMIR data, EPFR Global, Lipper and ECB calculations. Notes: Left panel: data on catastrophe bonds are copyright to www.artemis.bm, Steve Evans Ltd. To avoid end-of-year effects, the outstanding amount of emission-related derivatives is the notional value of open positions reported under EMIR as at the end of November. 2015 values are not included due to data unavailability.

Continued lending from other parts of the euro area can therefore help cushion the impact and support consumption and investment. In addition, holding foreign bonds – which are less affected by the asymmetric shock – helps maintain income and support domestic consumption. In the United States, these channels alleviate around 60% of the impact of state-level shocks on GDP growth, compared with just 20% in the euro area. Indeed, the contribution of credit smoothing in the euro area was negative during the global financial crisis as cross-border credit provision evaporated, worsening the recessions in the periphery. [2] During the pandemic there have also been sizeable swings in measures of financial integration, albeit more muted than during the financial crisis. [3] Indicators based on the convergence of asset prices declined sharply at the onset of the pandemic, but then rebounded following the ECB’s announcement of substantial monetary accommodation and subsequent progress on European fiscal support packages (Chart 1). Movements in quantity-based financial integration indicators, which reflect cross-border asset holdings, have been slower, but more persistent. [4] Cross-border activity in the unsecured segments of the money markets paused and cross-border equity holdings declined sharply at the onset of the pandemic, posting a partial rebound in mid-2020. Over the past year, financial flows have tended to be characterised by more liquid assets and securities with shorter maturities, pointing to a higher vulnerability to shocks.
Stefan Ingves: The need for a strengthened insolvency and resolution framework for banks – a central banker’s perspective Speech by Mr Stefan Ingves, Governor of the Sveriges Riksbank, at the International Bar Association’s 14th Annual Global Insolvency and Restructuring Conference, Stockholm, 19 May 2008. *  *  *  As a central banker, the tasks assigned to me are to maintain price stability and to promote a sound and efficient payment system. In short, I deal with economics and finance. So what does this have to do with your business, insolvency law? What is a central banker doing opening this conference on insolvency and restructuring? Actually, there are more links between the fields than you might think. As I said, one of my tasks is to oversee the payment system. Without a functioning payment system, no modern economy is able to function for very long. But what we call the payment system is really not much more than a system where money is transferred electronically from one bank account to another, in a longer or shorter chain of intermediaries with the central bank as a hub. If there is a problem in one of those intermediaries, there is a problem in the payment system. And if the problem is not technical but financial in nature, this may lead you right into the area of insolvency law and bank restructuring regimes. But in fact, there is also a link of a more general nature.

But, on the other hand, since we only have limited experience of macroprudential instruments, a step-by-step approach may seem more attractive. Furthermore, even if the first best solution would be bold steps, it may be more difficult to gain consensus for these. I think it would be better and more reasonable to take a number of small steps in order to avoid inaction bias and a standstill in reforms. Taking Sweden as an example: in its biannual Financial Stability Report, the Riksbank outlines several alternatives for how the growing risks associated with increasing household debt may be managed. The second issue that needs to be addressed is how macroprudential policy should interact with other policy areas when it comes to tackling systemic risk. My view is that monetary policy could take systemic risk into consideration under the precondition that this doesn’t conflict with the objects of monetary policy. That is, if the object of monetary policy is inflation targeting, monetary policy may very well serve as a line of defence if inflation is not too far from the target and if inflation expectations are firmly anchored.1 However, macroprudential policy also has links to microprudential policy and fiscal policy. All these policy areas may need to be involved in order to curb systemic risks in the most effective way. What instrument to choose in a specific situation should depend on the problem at hand and the purpose of the policy action. The most effective tool may not always be in the hands of the macroprudential supervisor.
It would be fantastic if that caught on. It would align the time horizon of bank employees with that of their customers, reducing the incentives to put short-term sales ahead of long-term relationships. Fourth, credit. The rising tide of inequality either side of the crisis was given impetus by first the boom and then the bust in credit and asset prices. We must in future do a much better job of moderating those credit booms and busts, to prevent them acting like a regressive tax on the poorest in society. That collateral damage is all too evident today in the chronically low levels of credit being extended on the high street – to first-time buyers wanting to put their foot on the first rung of the housing ladder, to business start-ups seeking to invest in assets, human and physical. Lending to UK households and companies has been contracting for 4 years and counting. BIS central bankers’ speeches  5  In preventing a repetition, a first step is to recognise that taming the booms and busts in credit is a key public policy responsibility. Step two is charging someone with this task. And step three is getting on and doing just that. In the UK, we are already three steps along this road, with the introduction of a Financial Policy Committee (or FPC) housed at the Bank of England from last year. Its remit is to keep the system safe and sound while supporting lending and growth.

At present, this information is private which acts as a barrier to entry by new banks. It also acts as an impediment to consumers switching and searching between banks and their products. With customer information held in a network utility, like the electricity grid or railway network, banks could plug and play when offering deposits and loans to customers. The costs of entering the banking market would be lowered for new banks. And so too would the costs of searching and switching for customers, between banks and between products, rather as you might between gas or mobile phone suppliers. There is already some encouraging evidence of new entrants to the banking market. In weak moments, I think that we might even be on the cusp of a technological revolution in banking. Certainly, some new firms are bringing new technologies to banking – for example, through mobile payments. Others are mobilising pools of non-bank funds to finance lending directly – peer-to-peer lending, crowd-funding, invoice-financing. Others still are demonstrating that a clear focus on retail banking services, delivered locally by forging long term relationships, can be a winning strategy. For example, take Handelsbanken. How many of you have heard of them? They are not yet a high street name, by comparison with say a Barclays or a Lloyds. But that is changing. They may be the fastest expanding bank in the UK at the moment. On average, they open a new branch – not a cost centre, a branch every two weeks.
Restoring confidence in U.S. fiscal management would be important and necessary independent of the broader context of the global economy today, but it is more important given the size of our external imbalance, now running at the unprecedented level of 7 percent of GDP a year. The trade balance in real terms has been broadly stable over the past two years, but our net income payments have shifted to deficit, and the size of that component of the current account deficit seems likely to continue to expand. These large global imbalances, our current account deficit and the surpluses that are the counterpart to our deficit, will have to come down over time. How that process unfolds will depend on a complex mix of factors around the world. Confidence that the U.S. political system will act to generate a sustainable fiscal trajectory is important to raising the probability that this process of adjustment unfolds with less risk. A successful conclusion of the Doha round of trade negotiations would provide some insurance against the risk that the process of economic integration will be interrupted or reversed. Despite the relatively favorable average income gains of the past few years, a common feature of the political context in economies around the world is the fragility or weakness of public support for openness and economic integration. 2  BIS Review 2/2007  The political challenge of sustaining support for the process of integration may be the most important economic challenge of our time.

To paraphrase Lawrence Summers, it is not enough to explain that globalization is inevitable and that policies that look politically attractive as a response to economic anxiety will only hurt the economy as a whole. Nor is it a politically effective strategy to state simply that economic integration is a necessary and powerful force in raising average incomes, or that technological change may be more important than trade or immigration as an explanation for slower growth in real wages for many Americans. Raising the quality of education and exploring ways to improve the safety net are a necessary part of the solution to this challenge. But these reforms will have a long fuse and they may not yield the hoped-for increase in support. Trade does not appear to be more popular in countries with more generous safety nets, universal health care and highly subsidized higher education than it is today in the United States. The political challenges of sustaining support for global economic integration and fiscal sustainability will be more difficult in the United States because of what has happened to the distribution of income and economic insecurity.
All in all, if, as we are often emphasizing during this crisis, the post-crisis reforms have mitigated the risks to the sector’s financial stability, the implementation of the resolution framework has contributed to strengthening the banking sector in a crucial manner. Identifying gaps for a more robust resolution framework in the EU Accepting that we have made great advances in this field, we have to acknowledge also that there is still some way to go before we can truly assert our journey is over. First of all, it is important to recall that the European resolution framework is one of the three pillars of the Banking Union and it is essential to develop the third one – the much needed European Deposit Insurance framework – to ensure the resilience and well-functioning of this Banking Union. As this matter goes beyond the scope of this conference, I will rather concentrate on the second pillar of the Banking Union. So, entering into this resolution pillar, there are certain areas on which both policymakers and practitioners should concentrate, and it is precisely some of these gaps that I want to discuss today, namely: -  liquidity in resolution, the resolution approach to small and mid-sized institutions, avoidance of unlevelled playing fields, and the adequate treatment of systemic situations. The first issue to be addressed, as it affects all institutions alike, is the provision of liquidity to a bank in resolution.

Finding an effective commitment mechanism is of particular importance in this context. Because of a lack of fiscal discipline, the Federal Reserve suspended its obligation to redeem dollars for gold in 1971 and the Bretton Woods Agreement collapsed. This was the beginning of a period of inflation and economic instability in many parts of the world, referred to as the decade of Great Inflation. In Norway as in other countries, the government moved in practice away from the objective of a permanently stable exchange rate. 24 It carried out 10  21  See Bjerkholt, Olav (2008): “Sosialøkonomenes oppmarsj og nasjonalbudsjettet (The rise of the economist and the national budget)”, Samfunnsøkonomen Nos. 6 and 7, Vol. 68. 22  Phillips, A. W. (1958): “The Relation Between Unemployment and the Rate of Change of Money Wage Rates in the United Kingdom, 1861-1957”, Economica, Vol. 25, No. 100, pages 283-299. 23  Friedman, Milton and Rose D. Friedman (1998): Two Lucky People: Memoirs, University of Chicago press, pages 386-387. More rapid growth in the money supply would imply lower interest rates in the short term. 24  In 1975, Sargent and Wallace published the article “ ‘Rational’ Expectations, the Optimal Monetary Instrument and the Optimal Money Supply Rule” in Journal of Political Economy, Vol 83, No. 2, April, pages 241-254. According to the article, monetary policy had to come as a surprise in order to have any impact on the economy. Expected policy had no effect.
Jean-Pierre Danthine: A world of low interest rates Speech by Mr Jean-Pierre Danthine, Member of the Governing Board of the Swiss National Bank, at the Money Market Event, Zurich, 22 March 2012. *  *  *  I would like to extend my thanks to Anna Faber, Adriel Jost and Pierre Monnin for their support in writing this speech. I also thank Carmen Kissling for providing research assistance and Marco Huwiler, Rita Kobel, Sébastien Kraenzlin, Peter Kuster, Thomas Maag and Barbara Sutter for their insightful comments, which improved the quality of the final version. Ladies and Gentlemen, It is my pleasure to welcome you to the Swiss National Bank’s (SNB) eleventh Geldmarkt-Apéro. For the third consecutive year I have the privilege of discussing Swiss monetary policy with you, together with significant aspects of the context in which it is conducted. Today, my deputy and fellow board member, Dewet Moser will provide an overview of the SNB’s implementation of monetary policy in the last year. In particular, Dewet will highlight the measures we have taken to address the strong Swiss franc. Meanwhile, I will concentrate on the very low interest rate environment, which has played an important part in guiding economic participants’ choices for some time now. Beforehand, however, allow me to make a few comments on our recent monetary policy decision. As emphasised on 15 March, the minimum exchange rate of CHF 1.20 per euro remains front and centre of the SNB’s monetary policy agenda.

“The financial market impact of quantitative easing.” Bank of England Working Paper No. 393. July 2010, revised August 2010. Krogstrup, Signe. 2012. “The effects of the SNB’s liquidity expansion on asset prices at the zero lower bound.” SNB Internal Note. February 2012. Krogstrup, Signe, Samuel Reynard and Barbara Sutter. 2012. “Liquidity Effects of Quantitative Easing on Long-term Interest Rates.” SNB Working Paper. January 2012. (forthcoming). Taylor, John B. 2009. Competing Explanations: A Global Savings Glut. pp. 6–7. BIS central bankers’ speeches  5  6  BIS central bankers’ speeches  BIS central bankers’ speeches  7  8  BIS central bankers’ speeches  BIS central bankers’ speeches  9  10  BIS central bankers’ speeches  BIS central bankers’ speeches  11
Growth in Sweden will gradually recover… In the wake of the financial crisis there were dramatic fluctuations in production in 2009 and 2010, with a fall in GDP of over 5 per cent followed by an increase of over 5 per cent (see Figure 17). The National Accounts indicate that growth continued to be strong in the first half of this year, but not as strong as in 2010. As I have mentioned already, “soft data” in the form of confidence levels and so on looks much weaker as a result of the global unease. Our assessment is therefore that there will be a substantial slowdown in growth next year (see Figure 17). Thereafter we expect growth to increase towards 2.5 per cent, which historically speaking is a rather normal level (see Figure 17). An important driving force for an increase in growth in the period ahead is that the households have a high level of saving to start with (see Figure 18). Saving is expected to remain high in the immediate future due to the unease around the world, but as unease subsides it is likely that the households will reduce their saving. Consumption may then increase at a relatively good rate. The labour market has improved and unemployment has fallen rather rapidly since the end of 2009. Our assessment is that this improvement will now slow down. Unemployment will continue to fall, but at a slower rate.

The US  2  BIS central bankers’ speeches  economy was in many senses the epicentre of the financial crisis. There are a number of problems that need to be dealt with. First, many households in the United States have fallen into difficulties because their debts exceed the value of their homes. The households have therefore needed to increase their saving, which they have done. As a result, private consumption has grown slowly for some time but does have the potential to recover in the period ahead. Second, public finances are weak in the United States too (see Figure 9). The situation became more dramatic in the summer when the country’s credit rating was reduced. The political deadlock in the US Congress was one of the main reasons for this. A major advantage in the United States is that, so far, government bond rates have remained very low (see Figure 2). However, it is important that these problems are resolved so that this positive trend can continue and so that interest rates do not begin rising as they have done in several countries in southern Europe. There are, however, a number of bright spots with regard to the US economy. One is that the companies are making good profits. We have to go all the way back to the early 1950s to find as high a level of profits in relation to GDP as there is now. When confidence returns there is therefore every chance that investment and employment will recover.