samchain/econo-pairs-v1 huggingface dataset:
Due to the bullish gold market, this slight increase in our sales quota has had favourable effects. Translated into Swiss francs, the average selling price has settled at over Sfr 15,140 per kilogram. Since the sales began, the price per ounce has fluctuated between USD 256 and USD 330 (see graph). Recently, it has again surpassed the level of USD 320 per ounce. Such high levels had been recorded only during short periods in recent years, for example in reaction to the central bank gold sales agreement of September 1999. What is striking about the current gold rally is how persistent it has proved so far. Several factors have contributed to this new trend: •  A key factor supporting the high gold price is the mines' changed hedging policy. In order to reduce part of the price risk on their future production, the mining companies may engage in forward sales of gold and in similar hedging transactions. The commercial banks, in turn, which act as counterparties in these transactions hedge against the risk by borrowing gold from the central banks and reselling it immediately. This increases the amount of gold offered directly on the market. The gold lent by the central banks flows back to the lender upon expiration of the forward contract. If the mining companies hedge less, the gold on offer is reduced correspondingly. In the second half of the 1990s, gold producers massively expanded their hedge positions, which led to an increase in supply and thus contributed to depressing the gold price.

Since the mid-1990s, politicians had been encouraging these households to own their own homes by setting quantifiable targets for how much lending from the mortgage institutions should increase.2 Subprime loans had become increasingly common and many households bought houses in the belief that house prices would continue to rise. When prices on the saturated housing market then began to fall in 2007, many US households with subprime loans found themselves in a situation where they were too highly mortgaged in relation to their incomes, and the credit losses of the mortgage institutions consequently increased. The subprime loans are, however, not the only underlying cause of the crisis. One important cause is the imbalances in the global financial system that have built up over a long period of time. The years 2002 to 2006 were marked by strong growth in the global economy, the expansion of credit, historically low interest rates and a dramatic rise in housing prices and other asset prices. The United States built up large deficits in its current account, which it could fund because other parts of the world, mainly China and the oil-producing countries, built up large surpluses in their current accounts. securities are considered to have no credit risk, the TED spread can be interpreted as a measure of the uncertainty in the financial markets. 2  2  See, for instance, the Community Reinvestment Act. BIS Review 7/2009  Another cause behind the crisis is the structured credit products which form part of the financial innovation.
The repo rate could then be cut, and the bond purchases extended. But there is of course a floor for the repo rate and a ceiling for the purchase of bonds – our aim after all is to get inflation up in an orderly manner. If the inflation outlook deteriorates more substantially, we could therefore end up in a situation where monetary policy can no longer do anything meaningful to raise inflation. In such a situation we would be forced to accept that it would take longer to bring inflation up. I would like to emphasise that I see a major difference between that kind of development and the increased patience with low inflation that the critics call for and that I have discussed in this speech today. My view is that the Riksbank should use its monetary policy tools to the full in order to attain the inflation target as well as possible. This does not mean that we are pursuing an inflexible monetary policy which aims to keep inflation at exactly 2 per cent all of the time, but when inflation has been clearly below target for many years we must focus on raising inflation and ensuring that inflation expectations are anchored around 2 per cent. Finally, I would like to reiterate that our main scenario is that the monetary policy we are currently pursuing is sufficient to keep inflation rising and make it reach 2 per cent relatively soon.

Beyond the theoretical considerations, it is important that financial regulation, in all its forms, should contribute to maintaining financial system diversity. Thus, attempting to measure all assets and liabilities at fair value has some drawbacks – and even entails risks – that need to be taken into account if lessons are to be drawn from the financial crisis for accounting rules. To conclude, I would like to stress an important point regarding the new financial regulatory framework. It would be unrealistic to believe that financial regulation is the answer, and, above all, that it is capable of protecting us from the risk of financial instability. Indeed, the crisis can largely be attributed to financial institutions’ inadequate risk management, which stems from an irrational trust in quantitative tools. Financial regulation should be an incentive for financial system participants to develop a sound and efficient management framework. It is no substitute. 2  BIS Review 161/2008
If the impact on profitability is substantial, it can over time undermine the robustness and integrity of the banking system as a whole, since only a banking system that is profitable in the long term can maintain and further build up its resilience. And only a resilient banking system is capable of seamlessly fulfilling its core economic functions. Furthermore, a decline in profitability could lead to banks taking excessive risks in an attempt to reach earnings targets, which – again – is undesirable from a financial stability perspective. To assess the impact of low interest rates on the Swiss banks, it is useful to start by considering the business activities with which banks generate their income and how these activities are impacted by exceptionally low interest rates. 3  For an extensive discussion of the effects of the negative interest rate, cf. Jordan, Thomas (2016), Monetary policy using negative interest rates: a status report, Speech at Vereinigung Basler Ökonomen, 24 October 2016, www.snb.ch/en/mmr/speeches/id/ref_20161024_tjn. Page 4/10  First, let us consider the earnings. There are three key ‘pillars’ or sources of income in banking: interest business, commission business and trading business. In simple terms, interest business consists of granting interest-bearing loans and financing them with lower-interest deposits or by issuing debt certificates, such as bonds. This is classic banking business. Commission business principally stems from fees charged for the provision of services, such as asset management or advising companies on bond or share issues.

For its part, the SNB monitors developments on the credit and real estate markets continuously and reassesses the need for an adjustment of the countercyclical capital buffer on a regular basis. Thank you very much. Page 10/10  Negative interest rates: necessary from a monetary policy perspective – but with what risks for the banks?
At the backend, the life insurance industry is beginning to pilot smart claims – the use of artificial intelligence and blockchain enables them to automatically trigger and settle claims. It will mean vastly faster settlement of claims,1 and the better service that customers in Asia will come to expect. 10. Life insurers in the region are also teaming up with fintechs, or establishing dedicated innovation labs of their own. We have five such innovation labs helmed by life insurers in Singapore. Other insurers collaborate with fintechs to co-develop solutions – as Prudential has done with its Pru-Fintegrate Programme. These are often focused on digital distribution, achieving customer centricity, as well as testing IOT devices and solutions. From Insurance Agents to Trusted Advisors 11. At the end of the day, the digital transformation will also transform the jobs of insurance agents or financial consultants. As technology is applied to more tasks within the insurance value chain, some adjustment, re-skilling, and re-scoping of roles will be necessary. Agents, freed from repetitive processing and queries, will be able to focus on a deeper understanding of the financial needs of the customer. 12. Prudential Singapore has begun this transformation, equipping their financial consultants with its cognitive chatbot askPru since August 2017. (askPRU instantly retrieves information about a customer’s policy and status of submitted claims, amongst other details, enabling financial consultants to respond to their customers faster.)

The telehealth market in Asia Pacific is expected to grow by 12 per cent annually to reach $ billion in 2020. In Singapore, we have been rolling out TeleRehab services for stroke patients. It delivers better health outcomes because doctors can monitor patients and make sure they follow-through on rehabilitation without the inconvenience of regular physical travel to the clinic. In the US, Kaiser – a major healthcare provider in California – already has more than half of its consultations through tele-health, and insurers have begun to accept telehealth claims. iv. In Singapore, the first tele-health trial by an insurer was launched last year, enabling policy-holders at risk of heart problems to be monitored remotely so that abnormalities can be picked up in time, and issues detected before they become critical. I encourage insurers to partner with healthcare providers and research centres to test such applications and support the implementation of Smart Health platforms. It supports an important paradigm shift towards preventive and sustainable healthcare management for policy-holders. 9. There is opportunity for insurers to go digital in other ways too. At the front end: It is frequently remarked within the insurance industry that an insurer interacts with its clients just once or twice a year- for signing, renewals and claims. Apps and social media present insurers with more touchpoints to understand and engage their clients. Telematics and IOT (internet of things) devices enable data analytics, allowing the insurer to deliver more customised and innovative products and services.
I encourage the industry to promptly address the matters that require action on their part. In particular, I am worried about two current shortcomings: •  The reach of Title II’s one-day stay on the close-out of qualified financial contracts is incomplete and does not extend to contracts governed by non-U.S. law with nonU.S. counterparties. BIS central bankers’ speeches  1  •  The placement of the parent company into receivership may be treated by these counterparties as an event of default due to the presence of a parent guarantee or other cross-default provisions triggered by the parent-level insolvency. Unless market participants make the appropriate contractual changes that will ensure that the entry of the parent company into Title II will not trigger the close-out provisions of those over-the-counter derivatives and other qualified financial contracts that are outside the reach of Title II’s U.S. application, foreign counterparties to the systemically important firm will tend to exercise this right whenever it is in their individual economic interest to do so. This would create significant difficulties because such actions could greatly complicate the operations of the firm during a time when it is already under considerable stress and would propagate stress more broadly in financial markets. There are two main options for addressing this issue, and they are not mutually exclusive.

Let me conclude by emphasizing that these two paths – reducing the financial stability costs associated with the failure of a systemically important financial firm versus applying tougher capital and liquidity standards for such firms that reduce the probability of failure – are complements not substitutes. We need to keep pushing forward with both approaches in order to make the financial system more resilient and robust. Thank you for your kind attention. I would be happy to take a few questions. 4  BIS central bankers’ speeches
Table 3 Growth in housing prices (1) (real annual growth, percentage) 2002-2007  2009-2T2012  Nation-wide total (2)  3.1  5.7  Average of districts with significant increases (3)  1.6  8.3  (1) Averaged y-o-y growth between first quarter of initial year and last quarter of final year in each case. (2) Obtained using stratified method. (3) Average of districts with structural growth breakdown, according to methodology of Ferreira and Gyourko (2011). Source: Central Bank of Chile based on Internal Revenue Service (SII) data. BIS central bankers’ speeches  11  Figure 6 Housing sales by building phase (percentage of total) 100  100  80  80  60  60  40  40  20  20  0  0 08  09 Completed  10 Finishes  11  12  Structural work  Other unfinished  Source: Cámara Chilena de la Construcción. Figure 7 Mortgage debt to collateral ratio (*) (percentage) 90  90  85  85  80  80  75  75  70  70  65  65 07  08  09  10  11  12  (*) Preliminary figures of new operations approved in respective quarter. Source: Superintendence of Banks & Financial Institutions (SBIF).

Expectations regarding the United States are that it will continue to recover at a slow pace, and that moderate adjustments to the fiscal policy will take place. The downgraded outlook for Japan needs mention, due to both its relation with the Eurozone and some fiscal adjustment measures foreseen for 2014. In the emerging world, incoming data from China suggest that the slowdown of most of 2012 may be reverting. Thus, again y-o-y growth rates around 8 percent are forecast for the Chinese economy for 2013 and 2014. Growth prospects for Latin America are revised downward for this and the next two years. In this scenario, commodity prices will not change much from forecasts a few months back. In the two-year period 2013–2014, the baseline scenario foresees average prices of $ per pound of copper and $ per Brent oil barrel. Accordingly, terms of trade estimates for Chile continue to be high, but lower than they were this year (table 2). External financial markets have shown some calm these months. However, as I noted at the beginning, there is still a long way ahead before the Eurozone crisis can be resolved. The commitment of various organizations to work out a solution seems to be bearing fruit in the market’s evaluation. Anyway, the baseline scenario again considers the possibility of new stress episodes in the world markets. Such greater calm has also reflected in stock markets and currency parities. In recent months, the U.S. dollar has depreciated slightly against the main currencies.
The negative interest rate and our willingness to intervene in the foreign exchange market as necessary remain essential. In so doing, we are keeping the attractiveness of Swiss franc investments low and reducing upward pressure on our currency. Page 1/4  Berne, 13 December 2018 Thomas Jordan  News conference  The new conditional inflation forecast for the coming quarters is lower than it was in September. This is mainly due to the drop in oil prices. The medium-term inflation forecast is also slightly lower owing to more moderate growth prospects. For the current year, we continue to anticipate inflation of 0.9%. For 2019, we have revised our forecast down from 0.8% to 0.5%. For 2020, we expect inflation of 1.0%, compared with the previous forecast of 1.2%. The conditional inflation forecast is based on the assumption that the three-month Libor remains at –0.75% over the entire forecast horizon. Global economic outlook  I would now like to turn to economic developments abroad, as these have a considerable bearing on the inflation and economic outlook in Switzerland. The global economy is somewhat less robust than it was a few months ago. Although the pace of growth remains strong worldwide, it is no longer quite as pronounced as at the beginning of the year. One reason for this is that the economic recovery is already well advanced in many countries, and momentum is slowing as a result of the high utilisation of production factors. Another reason is that a number of uncertainties are hampering growth.

On the contrary, combining flexibility and skill adaptability will lead to a higher job turnover, but also to a better allocation of labour and a lower structural unemployment. Currently, the French lifelong training system is unable to provide the appropriate skills, as shown by the disconnection between job vacancies and the unemployment rate, here on an inverted scale. Unfilled vacancies represented more than 200 000 lost jobs in 2017. Apprenticeship is insufficiently developed, resulting in a high youth unemployment rate. Lifelong training and the apprenticeship system are currently being reformed, with ambitious and accurate proposals by the government. The lifelong training reform will strengthen training rights, especially for the least qualified and the unemployed. It will simplify arrangements for businesses and streamline the governance and financing of the system, while 14bn € will be dedicated to it in the 5-year investment plan. Add the announced bold plan for primary and secondary education, as well as for the access to University, and you can really expect that the French labour market and skills will dramatically improve. [slide 13] My final illustration is the interaction between labour and product market reforms. Labour and product market reform both imply an alleviation of red tape and ease business activity. 3/4  BIS central bankers' speeches  There has been significant progress in the past, as reflected by the decrease in OECD’s Product Market Regulation or network industries regulations indicators.
All in all, the banks’ capital position will be strengthened considerably compared with previous regulations, contributing to the boosting of confidence, both in the individual banks and in the system as a whole. …and carry out clear measures for liquidity In the light of the crisis of the autumn of 2008, the Basel Committee has decided, for the first time, on quantitative requirements for liquidity in the banks. Basel III works with two liquidity measures – one short-term and one long-term. The short-term measure is based on, in principle, every bank having sufficient liquid assets to survive for at least 30 days. It is difficult to consider such a requirement as unreasonable. The long-term measure, in principle, limits the gap between the maturity of a bank’s assets and the maturity of its debts. So this limits the duration risk of the bank. In the end, Basel III will be implemented as national legislation The regulations I have just sketched will eventually enter national legislation. They are to be fully implemented by 2019, with several sub-targets on the way. In the EU, Basel III will be implemented through what is referred to as the CRR/CRD IV.11 Those of you who have followed the ongoing negotiations know that both countries and EU institutions have different views about how implementation should take place in the EU. An important dividing line has been to what extent countries should be able to stipulate higher requirements nationally than those formulated in the common EU regulations.

As the banks largely obtain funding from loans from each other and other financial  1  Modigliani, F & Miller, M H (1958): “The Cost of Capital, Corporation Finance and the Theory of Investment”, American Economic Review  BIS central bankers’ speeches  3  institutions, the lack of confidence led to a drying-up of liquidity within both the financial and real economies. The crisis was met in a somewhat similar way by the United States, Europe and Sweden On the whole, the financial crisis was met in a similar way by all OECD countries. The automatic stabilisers were put to work in fiscal policy, and many countries launched targeted fiscal policy stimulation measures to break the fall. The central banks reduced interest rates to very low levels. Almost all economies also took measures to prevent even deeper problems in the financial sector. In the United States, where the crisis originated, the Federal Reserve and other authorities provided emergency liquidity assistance to the banks and other parts of the financial system. The Department of the Treasury’s TARP (Troubled Assets Relief Program) purchased problem assets from banks and other financial institutions. The guarantee programme for the banks’ deposits was expanded. In addition, in 2009, a stress test was carried out of the 19 largest US banks as of the spring of 2009. Ten of these banks were deemed to need new capital, which they also succeeded in raising. It seems likely that this test helped restore confidence in the equity/assets ratios of the US banking system.
Unemployment in Sweden and selected countries Per cent 12  12  10  10  8  8  6  6  4  4  2  Austria Norway United States Sweden  0 94  96  98  2  The Netherlands United Kingdom Germany  0  00  02  04  06  08  10  12  Sources: Eurostat  Figure 4. Household loan-to-value ratio (debts/real assets) and the policy rate Per cent 100  10  90  9  80  8  70  7  60  6  50  5  40  4  30  3 Debt / Real assets (houses, summer houses, and condominiums)  20  2  Policy rate  10  1  0  0 71  76  81  86  91  96  01  06  11  Sources: Statistics Sweden and the Riksbank  BIS central bankers’ speeches  13  Debt/real assets, %  Figure 5. Household loan-to-value ratio (debt/real assets) and the policy rate (1993 Q1 – 2012 Q3) 70  70  65  65  60  60  55  55  50  50  45  45 0  2  4  6  8  10  12  Policy rate, %  Sources: Statistics Sweden and the Riksbank  Figure 6.

Temporarily high inflation is needed to reduce unemployment One consequence of high unemployment over a long period of time and of unemployment tending to become entrenched at higher rates, is that inflation will be higher for a given rate of unemployment. This means that a sufficiently large demand for labour to bring down the high unemployment towards a long-run sustainable rate will lead to higher inflation than normal for a period of time. It is therefore important to allow inflation to overshoot the target for a number of years. This would be a necessary cost that should be weighed against the gain of bringing down unemployment. As inflation on average has fallen below the target, an inflation rate above the target would at present also have the advantage that average inflation over a long period would come closer to the target, something that would contribute to avoiding the unnecessarily high average unemployment that earlier policies have caused. According to Prospera’s surveys, inflation expectations have stabilised at 2 per cent from 1997, despite average inflation being lower. Inflation expectations would thus probably be stable even if inflation were to overshoot the target for a period of time. Summary: Monetary policy too tight My conclusion is that monetary policy in Sweden is and has been too tight.