samchain/econo-pairs-v1 huggingface dataset:
This implies that in the future, behaviour may no longer be sufficient indicators of risk, and motor insurance may well shift to become liability insurance bought by car manufacturers. Third, dynamic products. The global insurance industry today, has shrunk in terms of its percentage of global economic activity insured; some estimates put the figure at as little as 10% of global corporate risks covered by insurance. Clearly, risks landscapes are rapidly changing and insurers must look beyond traditional products, and innovate to address new and emerging risks. Yet, innovation eschews the traditional, and thus one of the most significant challenges of established insurers in this area comes from small challengers with big ideas: start-ups. Start-ups are nimble, hungry, and more often than not, represent the very consumers they seek to solve problems for. In the insurance space, these players are moving to directly address the consumer’s problem, which at its core, is one of managing risk, and not simply monetary coverage. We already see this happening in health insurance, where start-up insurers are creating new tools such as doctor and drug research, fitness tracking, and telemedicine5 tools6 that can interface with each other. In return, policyholders are rewarded with an effective, convenient and holistic healthcare package alongside their health insurance policy. Seizing opportunities using technology and innovation With the digital revolution rapidly underway, insurers must adapt quickly to transform their mind-sets and business models.

LumenLab is an enlightened response to Asia’s healthcare and retirement needs in the next decade, and is well aligned with MAS’ strategy to have innovation-led growth drive our next phase of development as a global insurance market. Conclusion Congratulations to MetLife and LumenLab. I look forward to continued partnership with you in Singapore. Thank you. 7  Transcript of Speech by Prime Minister Lee Hsien Loong at Founders Forum Smart Nation Singapore Reception, Prime Minister’s Office Singapore (2015). BIS central bankers’ speeches  3
The Federal Reserve has many responsibilities, most closely linked to the execution of U.S. monetary policy and the regulation and supervision of the U.S. financial system. In fact, the official title of the Federal Reserve Act includes the phrase “to establish a more effective supervision of banking in the United States,” so supervision has been a core responsibility of the Federal Reserve from the beginning. But what does “a more effective supervision of banking” mean? At the highest level, the Federal Reserve’s mission for supervision and regulation is to promote a safe, sound, and stable banking and financial system that supports the growth and stability of the U.S. economy and a fair and transparent consumer financial services market. That’s a lot, so it is useful to drill down a little; I can do that by describing what we do on an ongoing basis at the Federal Reserve Bank of New York. At the New York Fed, we operate under delegated authority to supervise the financial institutions in the Second Federal Reserve District, which encompasses New York, parts of New Jersey and Connecticut, the Commonwealth of Puerto Rico, and the U.S. Virgin Islands. This area includes enormous diversity in institutions from state member banks with total assets of less than $ million operating in a local community to bank holding companies with trillions of dollars of assets operating on a global scale.

Internally, the Federal Reserve has organized a supervisory program on cybersecurity that consists of subject matter experts from across the Federal Reserve System. Work is underway to enhance the analysis of IT examination data in conjunction with threat information to enhance risk-focused reviews during examinations. Through our discovery work with financial institutions, we have found that the state of cybersecurity readiness varies across firms. Supervisors are seeking to develop common principles to address cybersecurity issues and will work with other agencies to ensure that firms are dedicating resources and taking the appropriate actions to defend the operations that are critical to the financial services sector against cyber threats. This is particularly true for those risks that could be channeled through interconnected organizations and that could potentially have an impact on other firms and more broadly across the sector. •  Fintech The financial sector, like the broader U.S. economy and society, is becoming increasingly digital and there is considerable discussion of “fintech” – defined simply as the intersection between financial services and new technologies. A recent industry study, for example, reports that investment in fintech companies grew from $ billion in 2010 to $ billion in 2015.3 It is unclear, however, whether fintech will enhance or fundamentally disrupt the financial service and payments industries, or perhaps it is some combination of both. In any of these cases, however, supervisors will have a keen interest in monitoring the impact on the business models and risks of financial institutions and the way financial intermediation is done.
Competition within Sweden has also sharpened, which has increased the need for greater efficiency in many sectors. For example, our assessment is that increased establishment of low-price supermarket chains contributed to a fall in food prices in 2005. Should the interest rate have been cut further? It is clear that structural changes in the economy have in many ways held down inflation and created scope to cut the repo rate to historically low levels (diagram 9). From time to time there has been criticism which says that we should have cut the repo rate even more. The fact that such a discussion arises when inflation is well below the target level is not in itself surprising. However, it is important to have realistic expectations as to what monetary policy can achieve. Changes of a structural nature are difficult to capture at an early stage of the forecasting work as it takes some time before it becomes clear that the changes are not merely transient factors. This is one reason that needs to be recognised why inflation may deviate from the target level. One indication of the difficulties in making accurate forecasts is that inflation in 2005 was overestimated by in principle all forecasters (diagram 10). A comparison indicates, if anything, that the Riksbank was among the first forecasters to take into account the effects that have subdued inflationary pressures. Some analysts have periodically advocated a somewhat faster rate for interest rate cuts than that chosen by the Riksbank. However, the difference has on average been small.

Dividing price trends into different categories shows that it was mainly some imported product groups that showed unexpectedly weak development. It is difficult to determine from the outcome of only one month whether or not this is a sign of a more lasting development. Naturally, it is something we will pay attention to in our future assessments of inflation. We can also observe that over the past few years inflation has been kept down by high productivity growth and low import prices. This is partly related to developments in economic activity. However, there are probably also lasting factors behind the low inflationary pressure. We can see similar patterns in some other countries. Amongst other things, it is probably a question of the effects of increased global competition. The durability of this type of structural change is difficult to determine. I intend to return to this in connection with my look back at inflation developments during 2005. A further complication is that house prices and household borrowing have increased rapidly (diagram 3). There are some risks with this type of development that can be difficult to quantify. One cannot entirely rule out the possibility that credit expansion and house prices are being driven up by over-optimistic expectations. This could lead to a situation in future with sudden downward adjustments in house prices and a large increase in household saving.
Moreover, a long period of low interest rates can lead people to overestimate the debt they can safely manage if interest rates were to normalise. Central banks must be alive to these risks and deploy appropriate prudential tools in mitigation. Furthermore, if central banks do seek to sustain demand, it can dull the incentives for private agents and governments to undertake the necessary adjustments and reforms. Such moral hazard has surfaced from time to time in the euro area during the past couple of years. Accommodative monetary policy can buy time, but it is a policy best suited to filling in a temporary hiatus in demand, not a long-lived shortfall: it is a bridge, not a pier. Let me turn now to the international consequences of these unconventional monetary policies. There are several interrelated channels of propagation. First and most contentiously, they may put downward pressure on the exchange rate, a purely “beggar-myneighbour” channel. It was that which prompted Guido Mantega, the Brazilian Finance Minister, to charge advanced economy central banks with engaging in a “currency war”. Central banks in other countries may then respond by setting lower policy rates in order to lessen the appreciation of their currencies. One way to see whether this has happened is to look at the departures from what a standard Taylor rule would imply; the evidence surveyed by He and McCauley (2013) suggests that Asian central banks have indeed shaded down their policy rates in response to looser US policies.

“The Large Scale Asset Purchases had Large International Effects”, Federal Reserve Bank of St. Louis Working Paper #2010-018D. Rajan, Raghuram (2013). “A Step in the Dark: Unconventional Monetary Policy after the Crisis”, Andrew Crockett Memorial Lecture, Bank for International Settlements, 23 June. Tucker, Paul (2013). “A New Regulatory Relationship: The Bank, the Financial System and the Wider Economy”, Speech at the Institute for Government, London. Woodford, Michael (2012). “Methods of Policy Accommodation at the Interest Rate Lower Bound”, Federal Reserve Bank of Kansas City Symposium, Jackson Hole. BIS central bankers’ speeches  5
ECIs have been  constructed at the nation-state level and, more recently, at the local level in the US and UK. 54  One of the interesting features of these empirical ECIs is that they appear to match the theory: the greater the degree of specialisation and diversity, and the higher the ECI, the better the economic outcome. One rationale for this finding, proposed by Hidalgo and Hausmann, is that ECIs serve as a proxy of the degree of knowledge embedded in an economic area, knowledge that comes courtesy of specialisation and diversity. Charts 23 and 24 plot local authority level ECIs against measures of income per head and hourly earnings in the UK. They show a positive, statistically significant relationship. The same has been found at national level and among US states. The embodied-knowledge effect is, on the face of it, an empirically strong one. In a bivariate regression, ECIs account for around half of the regional variation in level of incomes and pay. Chart 23: Local authority-level ECIs and income per head  R² = 0.4799  GVA per head, £  140 120 100 80 60 40 20  -0.1  -0.05  0  0.05  0.1  0.15  0.2  0 0.25  ECI  Sources: ONS Regional Gross Value-Added, ONS Business Register and Employment Survey (BRES) and Bank calculations. Notes: ONS regional gross value-added (balanced) by local authority in the UK for 2016 against economic complexity indices calculated using BRES. City of London and Westminster excluded from chart.

This is upward-sloping and statistically significant, consistent with agglomeration effects. Moving from a city the size of Oxford (population 535,000) to one double its size such as Sheffield (around 1.2 million) should be  Department for Business, Energy and Industrial Strategy (2017). In a personal capacity, I chair the Government’s Industrial Strategy Council which evaluates its progress. 50 Forth (2019). 49  36  All speeches are available online at www.bankofengland.co.uk/speeches  36  expected, on average, to boost GDP per head from £ per head to £ per head, or around 2.6%.51  Chart 22: City population and GDP per head  Sources: OECD Metropolitan Areas Population and Bank calculations. Notes: GDP per capita in $ in 2015 and log scale used for metropolitan area population. In fact, GDP per head in Sheffield is around 44% lower than in Oxford. This is not just a North-South divide. Income per head in Sheffield is little different than in Doncaster just down the road (population 305,000). 51  Data set underlying Chart 22 refers to GDP per capita in $ in 2015. Numbers which convert to sterling in the text are based around average $ bilateral exchange rate of 1.34 in 2018. 37  All speeches are available online at www.bankofengland.co.uk/speeches  37  And it is not just Sheffield. Many large UK cities sit below the line: Belfast, Glasgow, Leeds, Manchester, Cardiff, Birmingham, as well as Sheffield. Agglomeration multipliers seem to be consistently smaller in a number of UK cities. Why?
Exchange rate movements are not to be considered as isolated events, neither should monetary policy’s reactions to them be mechanical. If a depreciation stems from an international slowdown, for example, the consequences for monetary policy will differ from a case where the roots lie in a lack of confidence in Sweden’s economic policy. The situation at the beginning of June can serve as an illustration. The problem was not simply that the krona was under-valued. That had been the case, though not so dramatically, for a long time. What led us to conclude that the situation was sufficiently serious to warrant action was a conjunction of several factors. The depreciation occurred very rapidly and we had not received any new information that justified such a marked movement. That meant that the future, relatively optimistic path for the krona on which monetary policy had been formulated now appeared less realistic. The depreciation was, moreover, particularly troublesome in that it coincided with a substantial price rise and accordingly heightened the risk of inflation expectations shifting to a rate of price increases that exceeded the Riksbank’s target. The increase in inflation stemmed both from transitory factors and from persistently high resource utilisation. BIS Review 75/2001  1  Forecasting exchange rates is difficult As I said, it is the exchange rate’s path in the coming two years that is important for monetary policy. So how can one arrive at a picture of the exchange rate several years ahead?

There are some reasons for the deviation between “felt” and measured inflation after the cash conversion. For example, price increases occurred particularly in the case of frequently bought goods and services usually paid for in cash. Such prices are more strongly “felt” than prices for products which are only bought from time to time, for example, cars or computers. It is also possible that consumers are still comparing current euro prices with prices in the national currencies before 2002. This “frozen price memory” leads to distorted comparisons. It also needs to be taken into account that the introduction of euro cash in January 2002 coincided with increases – caused by external factors – in energy and food prices and in indirect taxes. They were not at all related to the euro. In the public perception, however, they were associated with the cash changeover. Institutional foundations of the euro Many observers did not think the ECB could ensure price stability and anchor inflation expectations. Indeed, the ECB is a young central bank which, together with the national central banks in the Eurosystem, has assumed responsibility for a new currency, the euro, in a new economic and currency area, the euro area. Therefore it could not be taken for  2  BIS Review 16/2009  granted that the euro would be able to establish itself so quickly as a stable and internationally recognised currency. This was only possible because the ECB and the national central banks of the Eurosystem have solid institutional foundations.
Neither is there an urgent need to update the assessments; in this respect, one should stress the validity of the self-assessments carried out by the countries themselves, as a complement to the assessments performed by the Fund and the World Bank during their FSAP missions. The second general direction followed by the Core Principles revision was to keep their character of a single universal standard for assessing the quality of banking supervision, independently of the complexity of each country’s financial system. To maintain this universality, on the one hand, it was decided to place greater emphasis, throughout the text, on the idea that the Principles should be applied proportionally, always taking into account the material impact of the risks or the complexity of activities, which allowed application to be adapted to less sophisticated financial systems. On the other hand, the new Principles, by taking into account the most advanced practices, have gained in validity as regards the assessment of complex financial systems which were previously outside the scope of many of the established criteria. I would like to express my view that this universal character is one of the most positive aspects of the Principles. To achieve this, the Committee worked closely with a very large number of supervisors. Thus the initial drafts were prepared using groups made up of equal numbers of representatives from Committee members and non-members, involving both the IMF and the World Bank as interested parties.

Yet during this entire period the Committee has been devoting considerable efforts to drawing up recommendations that we consider to be key from a supervisory perspective, but which have not received as much attention as Basel II. The Core Principles revision is a case in point. Perhaps the fact that they are recommendations aimed specifically at supervisors, centred around the effectiveness of supervision without imposing direct requirements on the banking industry - although they obviously affect that sector’s activities indirectly explains why this has not generated the same glut of headlines as other initiatives. However, I believe that we would all agree on the important place that the Principles have occupied and continue to occupy, and we know that compliance with them is a priority for virtually all supervisors. The aim of the Core Principles is to establish a set of minimum requirements to be met in order for banking supervision to be considered adequate. This permits the identification of areas in need of improvement and facilitates planning to achieve these improvements. The passage of time has shown that the Core Principles have satisfactorily met these objectives since they were first issued in 1997. Moreover, they have permitted the establishment of an internationally accepted benchmark with which to evaluate the supervisory approaches of different countries. In so doing, they have helped to  BIS Review 45/2006  1  improve and encourage the convergence of banking supervisory standards, thereby contributing to global financial stability. So why revise them, even if the changes are only minor?
As we had initially put in place a soft loan facility which is directed to SMEs, we found overtime that the facility was not being tapped as well as it should. To put it as an analogy, the pipes were getting clogged. Thus, we responded flexibly and pragmatically by issuing a new Emergency Decree to put in place a new SME credit guarantee facility with accompanying credit facility for banks to try to lend to these SMEs. We have initially set a target of hundred billion baht loans extended through this facility in six months and we are well on our way to achieving that target. The latest figure stands at around 89 billion baht after about four  Page 4 of 9  months. This is an example of the pragmatic approach and the implementation that we, at the Bank of Thailand, have been willing to do. Another example of our flexible and pragmatic approach, and an indication of our willingness to step outside of our comfort zone as a central bank, is by introducing this other scheme, in addition to the SME credit guarantee facility, an asset warehousing scheme. We recognized that certain sectors require a targeted response in terms of the approach of debt restructuring. Certain sectors that are hard hit by the tourism slowdown are not in a position to engage in usual debt restructuring because with no tourists, several businesses in these sectors do not have any cash flow.

Rather than placing trust in central institutions – such as banks (and by extension the 6  All speeches are available online at www.bankofengland.co.uk/speeches  6  In this spirit of dystopian fear and libertarian optimism, the message accompanying the first or genesis Bitcoin block read: “The Times 3 Jan 2009 Chancellor on brink of second bailout for banks.” How well do cryptocurrencies fulfil the roles of money? The answer has to be judged against the functioning of the entire cryptocurrency ecosystem (which extends beyond the currencies themselves to the exchanges on which cryptocurrencies can be bought and sold, the miners who create new coins and verify transactions and update the ledger, and the wallet providers who offer custodian services). The long, charitable answer is that cryptocurrencies act as money, at best, only for some people and to a limited extent, and even then only in parallel with the traditional currencies of the users. The short answer is they are failing. Poor Stores of Value Cryptocurrencies are proving poor short-term stores of value. Over the past five years, the daily standard deviation of Bitcoin was ten times that of sterling. Consider that if you had taken out a £ student loan in Bitcoin in last December to pay your sterling living costs for next year, you’d be short about £ right now. If you’d done the same last September, you’d be ahead by £ That’s quite a lottery. And Bitcoin is one of the more stable cryptocurrencies.