samchain/econo-pairs-v1 huggingface dataset:
My hope is that governments are recognising that accommodative monetary policy and low oil prices, rather than removing the need for reforms, creates the perfect environment to do them. Research suggests that reforms can be more costly in a weak macroeconomic environment and, in particular, when there are serious credit constraints. With our successful credit easing policy we are progressively removing each of those barriers. More generally, however, I would question how much monetary policy decisions should be based around reform incentives. Applying again the Tinbergen rule, this creates two objectives to be attained with one instrument – and just as for financial stability, in the current environment those objectives conflict. The ECB has to prioritise price stability rather than acting as the censor of governments. Euro area governments as a community must ensure that each economy meets the requirements of membership. And it is in this context that I and other ECB Executive Board members have recently called for a stronger Economic Union in the euro area with improved common governance of structural reforms. Conclusion Let me conclude. The diminishing price pressures over recent years have required the ECB to act forcefully and repeatedly to fulfil its mandate. This culminated in January 2015 with our decision to expand our asset purchase programme to stave off deflationary risks and stop the fall of inflation expectations. In doing so we have sent a strong signal that we will safeguard price stability no matter what. This is our mandate as enshrined in the Treaty.

For example, Canada did not have a wage adjustment during the first historical period, but it experienced one during the second period. We refer to the latter as the second episode of wage adjustment in Canada. Peak years are country-specific; hence they are not the same in all countries. This means that the first wage adjustment episode, including the peak years, may have lasted, for example, 7 years in Italy, 8 years in Germany and France, 9 years in US, 20 years in Korea or 28 years (and counting) in Japan. Of the 35 countries analysed, 21 countries experienced the first historical episode of wage adjustments, 33 countries experienced the second historical episode of wage adjustments and only 2 countries experienced the third historical episode of wage adjustments. This is why the total number of observations is much higher for the second wage adjustment episode, compared against the first wage adjustment episode. In the case of the third wage adjustment episode, the total number of observations is much lower. And now we move to the juicy part. We present the graphical representation of our results for all OECD countries which experienced wage adjustments (21 countries for the first wage adjustment episode and 33 countries for the second wage adjustment episode). The results are statistically significant and with the expected sign for the first two adjustment episodes. For the third adjustment episode, the sign of the relationship is as predicted, but the number of observations is too limited to have statistical significance.
Part-time workers now make up about a third of the US work force, and many of them want to transit to full-time jobs. The labour force participation rate in the US remains near a cyclical low, at 63%. Even after accounting for the retirement of baby boomers, a meaningful segment of the population could re-join the workforce. If the labour market in reality is not as tight as the unemployment number suggests, then it is not surprising that wage growth has been weak. A second reason for low inflation has to do with the effects of globalisation. The integration into global production chains of workers from China, India, and the ex-Soviet republics during the 1990s and 2000s is estimated to have nearly doubled the size of global labour supply. This labour supply shock, facilitated by expanding global value chains, has exerted significant downward pressure on tradable goods prices. And the international outsourcing of production appears to have dampened the “pricing power” of labour and hence wage growth. A third explanation is technology. Industrial automation has exerted downward pressure on manufacturing wages. Likewise, advances in software programming and artificial intelligence are automating knowledge work and dampening wage increases in the services sector. More broadly, the spread of e-commerce has been eroding the monopolistic pricing power of traditional retailers and wholesalers of goods and services – the so-called “Amazon Effect”. I think it is premature to declare the Phillips Curve dead. Inflation will return when tightening cyclical factors outweigh the structural disinflationary forces.

But the pooling of savings within Life insurance companies and the willingness of policyholders to commit their savings for the long term also allows those savings to be channelled into new types of investment – ones that would be difficult or impossible for individuals to access directly, but which will play an essential part in the recovery and in meeting the challenges of the 21st century. And our data show that insurers are investing in ever more diverse and novel asset types, which often represent very long-term commitments. A willingness to innovate is to be welcomed. There is nevertheless a flipside to this novelty – the lack of a long history to guide the selection and risk-management of these assets, or to show how they may perform under various possible stress scenarios. So there are new sources of uncertainty to contend with, alongside those that insurers have been managing as their bread and butter for hundreds of years. Insurers, and we as their prudential regulator, have a responsibility to understand and respond to new uncertainties, some of which may play out over a very long horizon, to ensure that policyholders’ trust is repaid. Ensuring adequate policyholder protection is clearly a good in its own right – policyholders are consumers of a financial product, which may be very significant to them and their families, and they deserve to be protected. But it goes further. Securing policyholder protection upholds policyholders’ confidence and trust in the face of uncertainty.
I should say that we are not oblivious to what it takes for accession to be a success. No matter how much one wishes to put accession on a fast lane, success hinges on having achieved a critical mass of real and structural convergence with the Euro area. The lessons of the Euro area crisis remind us starkly this reality. The more robust the Euro area turns, as a result of institutional and policy reforms, the better for us. When it comes to reforms of the Euro area, I would highlight the respect for rules and their 1/3  BIS central bankers' speeches  enforcement, on one hand, and the introduction of risk-sharing schemes on the other. Among the latter I range a collective deposit insurance scheme (EDIS) which, together with a much stronger Resolution Fund (SRF) would complete the Banking Union, and the introduction of instruments that can help member states deal with asymmetric shocks. A euro area budget does make sense in this respect. Let me make a few remarks on the macroeconomic scene in Europe. The economic recovery of recent years has been heavily dependent on non-standard operations of the main central banks and very low interest rates. There are still large public and private debts, which are especially burdensome in the Euro area – and which complicate the mission of policy normalization, of unwinding special operations of the ECB. Fortunately, some countries in our region (including Romania) enjoy a much better situation in this respect.

The Vertical Phillips Curve Inflation (% ) 15  10  5  0 0  2  4  6  8 10 Unemployment (% )  12  Chart 2. The United Kingdom Phillips Curve, 1993-2005  BIS Review 52/2006  1  Inflation (% ) 15  10  5  0 0  2  4  6  8  10  12  Unemployment (% )  Source: ONS. The unemployment rate used here is the Labour Force Survey measure. Inflation is measured using the Retail Price Index excluding mortgage interest payments (RPIX). So what is going on? The explanation is, I believe, straightforward, but it contains some important lessons for the conduct of monetary policy today. In the 1950s and 1960s our experience was that the rate of structural unemployment was rather stable, so that large swings in the growth rate of money spending eventually showed up in movements of inflation. In those circumstances the Phillips curve does indeed appear vertical. But since 1992 monetary policy has kept inflation broadly constant – within 1 percentage point of its target every single month since December 1992 – while structural changes have reduced the sustainable rate of unemployment in every part of the United Kingdom – including Scotland. So the Phillips curve appears horizontal. In the decade up to 2004, that is until the recent slowdown, unemployment fell from double-digit levels to around 5% on the internationally comparable measure and to 3% on the claimant count.
Mr. George discusses Britain in Europe and the economics of EMU Speech by the Governor of the Bank of England, Mr. E.A.J. George, at the Borsen in Copenhagen on 6/3/98. I am delighted to be here this morning, and to have this opportunity to meet with the Danish financial community. I would like to use this opportunity to explain to you something of the British attitude to Europe - as I see it - and in particular our attitude to monetary union. I am well aware that we British have something of a reputation for stubbornness about Europe. I should like to try to persuade you this morning that while we do have some - not wholly irrational - misgivings, we are nevertheless as anxious as anyone to see the project succeed. We have to be - it is clearly in our national interest that it should. Let me make clear at the outset that, of course, I recognise that monetary union is fundamentally a political issue. It necessarily involves some deliberate pooling of national sovereignty over important issues of public policy - monetary policy and overall fiscal policy - just as the single market involved the pooling of sovereignty over aspects of trade and competition policy and so on.

We talk often about credit risk, market risk, liquidity risk, conduct risk in it’s several forms. You can add to that, hubris risk, the risk of blinding over-confidence. If I may say so, it is a risk that can be magnified by broader social attitudes. Ten years ago there was considerable reverence towards, and little questioning of, the ability of banks and bankers to make money or of whether boards demonstrated a sufficient diversity of view and outlook to sustain challenge. How things have changed. Healthy scepticism channelled into intelligent and forceful questioning of the self-confident can be a good thing. In turn, culture matters to us as financial regulators because it can, left alone, tend to shape and encourage bad outcomes, but it doesn’t have to do that. What can we do therefore as regulators to shape and influence better outcomes on a more consistent basis? Let me start with one thing that we cannot do. As regulators, we are not able, and should not try, to determine the culture of firms. We cannot write a regulatory rule that settles culture. Rather, it is the product of many things, which regulators can influence, but much more directly which firms themselves can shape. We seek to ensure that firms have robust governance, which includes appropriate challenge from all levels of the organisation; and promote the acceptance that not all news can be good and the willingness to act on and respond promptly to bad news.
It is in this context that the West was hit by oil shocks in 1973 and 1979 unleashing upward pressure on inflation and slowing real economic growth across major economies. Fast forward to 2020s, the pandemic and the war in Ukraine acted like two large supply shocks that put out of balance the global economy. Prices have gone up, and economic activity is slowing. Just like in the 1970s, the risk is that supply shocks spill over to the demand side, initiating a process that could push the world economy into a high inflation regime. Contrary to the 1970s, however, many central banks are more resolute than ever to pursue their mandate of price stability. Looking at the demand side, indicators of wage responsiveness are on the rise, but not to the extent that would fuel a wage/price cycle like in the 1970s. Indeed, despite a tight labour market, organised labour does not exert the influence it had fifty years ago: the  2/4  BIS - Central bankers' speeches  labour share of income has declined by around 15 percentage points from the mid1970s to 55%. A caveat on the labour supply. Today we still have to understand fully the make-up of our laboursupply post-COVID. Active ageing has still to come back to the 2019 levels, many young people are changing jobs more often, with some professions being shunned, people are taking time to decide what job they want to go for.

And in spite of the uncertainty surrounding the outcomes, the decision cannot be put off, since a wait-and-see approach is likely more costly, and certainly riskier. What is the price of not tackling inflation decisively? That we know. The high tax on the disadvantaged, on those on fixed incomes, incentivising rent seekers, the waste of dog chase tail wage-price spirals. At the same time we hear that a recession is not just around the corner but on our door step. We hear that certain indicators are also giving out the message that certain prices have peaked and some are even falling. So why all this unrelenting rush to kill off inflation when the recession has started to do the work itself. Let us be careful. My understanding is that the financial markets and economic forecasters do not believe that the recession as seen today will be so deep that it will do all our work. For inflationary expectations not to be anchored at levels where we do not want them, we need a more resolutive anti-inflationary policy measures. 1/4  BIS - Central bankers' speeches  The reason for taking this stance issupported by the currentsituation that fiscal policy this time around will not be in synch with the restrictive policy taken by Central banks. Driven by social pressures to cushion families hit by fuel and food shortages accompanied by astronomical price increases, governments are responding with subsidies of all sorts but mostly aimed towards fuel and food prices.
According to some estimates, in the past ten years European investment banks have lost 10 percentage points of their market share to US banks.iii This can be attributed to the difficulties European banks face in achieving the critical mass needed to operate in a global market. And Brexit will do  Page 3 of 5  little to change this trend if the European market remains fragmented. Conversely, US investment banks have the benefit of a huge domestic market where margins are higher. Their size gives them a decisive advantage when it comes to achieving economies of scale and competing for large-scale financing transactions. Faced with these structural challenges, French banks’ CIB divisions have already begun to refocus on more profitable activities and implement major cost-cutting plans. However, there is still a lot to be done, notably when it comes to industrialising processes and flows; digitalisation is also changing trading activities. 2.2  Banks and regulators therefore have three focuses for action  The main prerequisite for improving profitability is for banks to put in place individual restructuring strategies. There are a number of levers they can use for this: technological innovation, cost control or the diversification of revenue sources [slide 5]. On this latter issue, I would like to underline the resilience of the French “universal” or diversified banking model.

In parallel, they have raised their core capital ratios (CET1) by nearly 8 percentage points since 2008, from an average of 5.8% to 13.6% in 2018 [slide 3]. French banks’ profitability is in line with the euro area average and well above that of their German counterparts. At an international level, only the US banks stand out as having an ROE in excess of 10%. French banks have come a long way in the past ten years, in a demanding economic, financial and regulatory environment. We need to be wary, therefore, about using two misleading points of reference, the first of which consists in comparing current ROEs to precrisis levels – when they were clearly too high – and the second in focusing on the cost of equity. Apparently, the cost of equity for French and European banks is still too high at over 9% compared with less than 7% in the US; this figure fails to reflect either the strengthening of their solvency and hence resilience, or the sharp decline in risk-free rates [slide 4]. With regard to insurance, the industry remains solid. Figures for end-2018 should show that insurers’ solvency capital requirement coverage ratio has reached nearly 240%, which is similar to the level seen in 2017. But I shall let Bernard Delas come back to that in more detail later. Page 2 of 5  II.
More broadly, the clearer and more credible the framework governing purchases, the greater the likelihood that market participants would act in a manner that helped the Fed achieve its objectives. In particular, the more confident market participants are in the Fed’s ability to exit when the time is right, the more effective its purchases will be in stimulating the economy. Suppose the Fed was indeed successful in reducing long-term interest rates further – what then? Some claim that lower rates would have no effect on economic activity – that the Fed would be “pushing on a string.” This is too dark a view. Although the responsiveness of demand to reductions in interest rates is probably lower in a world in which balance sheet constraints are important, the responsiveness is not zero. I believe that it remains significant. Even in today’s challenging circumstances, lower long-term rates would support the economy through a number of channels. Lower long-term rates would support the value of assets, including houses and equities and household net worth. Lower long-term rates would make housing more affordable and support consumption by enabling households to refinance their mortgages at lower rates. This would increase the amount of income left over for other spending. Of course, this channel can be made more powerful to the extent that further progress can be made in efficient mortgage debt restructurings that allow households with negative equity in their homes to take advantage of the drop in mortgage rates.

The second condition may be even more stringent. Ultimately, what makes a reserve currency is the ability to serve unconditionally as a store of value. The country must therefore develop deep, liquid and unfettered financial markets. It also entails an ability to offer “benchmark” safe assets that keep their value in all circumstances, and may serve as vehicles for reserve accumulation. Typically, only government debt will be used as a reserve asset. So, being a reserve currency also means that “foreigners” will permanently hold a large part of Government debt and their judgment will ultimately prevail as to the true solvency of the Government. Being a reserve currency therefore implies constraints as much as it brings benefits. That may be the reason why countries, including China, would proceed cautiously on the road towards full reserve currency status. There is a distinction between being a reserve currency, on the one hand, and a global currency, on the other. The first concept refers to the currency as a store of value; the second may concern only its role as a medium of exchange. These are two different attributes. A currency may be widely used in transactions without being considered for reserve accumulation. This distinction maybe relevant when looking at the composition of the special drawing rights (SDR). As you know, this is the “basket currency” that serves as a unit of account for the IMF and, to a limited extent, as medium of exchange between its member countries.
In many respects, this ecosystem has recreated the very shortcomings and vulnerabilities that blockchain technology initially intended to address. Further complicating matters, the crypto market seeks integration into the financial sector for increased relevance and public sector support. This would not provide the basis of a sustainable future for crypto. If anything, it would only heighten contradictions and vulnerabilities, resulting in greater instability and centralisation. The public sector should adopt a determined position by establishing a comprehensive regulatory framework that addresses the social and environmental risks associated with crypto, including the use of unbacked crypto-assets for speculative purposes. It should also resist calls to provide state backing for cryptos, which would essentially socialise crypto risks. The public sector should instead focus its efforts on contributing to the development of reliable digital settlement assets, including through their work on central bank digital currencies. Decisive action of this kind should motivate the crypto ecosystem, including its foundational technology, the blockchain, to realign its objectives towards delivering real economic value within the digital finance landscape. Annexes 23 June 2023 Slides    ENGLISH  1. See Nakamoto, S. (2008), “Bitcoin: A Peer-to-Peer Electronic Cash System”, bitcoin.org. 2. To maintain a system of decentralised consensus on a blockchain, self-interested validators need to be rewarded for recording transactions. In order to achieve sufficiently high rewards, the number of transactions per block needs to be limited. As transactions near this limit, congestion increases the cost of transactions exponentially. See Boissay et al.

Issues related to credit growth were addressed at length in the Albania Financial Forum IV. The Forum's conclusions will serve as a road map in our joint efforts for lending to return to the desired levels. Concluding, I would like to underline that the Bank of Albania will remain committed to maintaining price stability and strengthening financial stability in Albania. In parallel, and in accordance with the engagements in the framework of this arrangement, the Bank of Albania will continue to work to further improve the regulatory framework and to further develop the financial infrastructure in Albania. Thank you for your attention! 2  BIS central bankers’ speeches