samchain/econo-pairs-v1 huggingface dataset:
Let me follow this account of the general framework of regulation governing financial investments denominated in foreign exchange with a description of the structure, strengths and weaknesses of our economy. The basic economic features of our country are attractive. A liberal trade and exchange rate regime, a modern and competitive private sector, abundant and vigorous consumer demand, and extremely attractive investment opportunities. This rosy picture is clouded by three economic problems that can be solved by a firm commitment to macroeconomic discipline. These three problems--high and persistent inflation, high public sector deficits, and large current account imbalances--are interrelated. Persistent high inflation has been Turkey’s main economic problem for the last two decades. Its main cause lies in the sizeable public deficit. Its other causes include entrenched inflationary expectations, exchange rate movements, monetary developments, interest rates, and price increases initiated by public enterprises. Under conditions of an open capital account, large public deficits can generate imbalances in the current account. Turkey’s current account tends to be volatile. For this reason, what Turkey really needs is to accept fiscal discipline. A sustainable and consistent fiscal policy is evidently the key to solving other economic problems. Achieving fiscal discipline will require political will as well as persistence. BIS Review 42/1997  -3-  Even though we have economic problems, we unquestionably also have the ability to overcome them. Turkey needs to make use of this potential. I therefore now wish to draw your attention to the considerable strengths of our economy.

Even though during the early years of the Exchange Market’s operation in the 1860’s, the amount of foreign direct investment in Turkey was negligible, foreign capital was being encouraged to form joint stock companies. Up until the beginning of the 20th century, the Market helped the government find funds to finance its obligations. In 1906, the Istanbul Exchange Market was re-organised and once more became a source of new capital for young private ventures. BIS Review 42/1997  -2-  Without giving the whole history of the Istanbul Exchange Market, I want to emphasise that Turkey’s experience with free markets did not begin in 1980 but goes back more than a century before. What the reforms of 1980 did accomplish was to institutionalise the markets and put them on a solid legal footing. Besides liberalisation, the structural reforms begun in 1980 included measures providing investment and tax incentives. I would like to review these issues briefly. The aims of these incentives were to encourage activities that would earn foreign exchange on the one hand, and to help foreign sources of capital finance investments in Turkey on the other. It can be said that by liberalising its capital account and introducing structural tax changes to improve investment returns, Turkey issued an invitation to foreign capital.
It is a game that gives people the chance to set monetary policy to steer the US economy. In the UK, “MyUK” allows people to put themselves in the Prime Minister’s hot-seat and invoke Article 50 on any day of the week. These are effectively single-person games, designed largely for educational purposes. But there is no reason a similar game could not be designed which was multi-person. This would allow interactions among the public, in their communications and choices, to take place. This is crucial for understanding the propagation of stories, and the contagion in choices, across the economy. Once those are captured, the game could offer important insights into public actions and reactions to central bank interventions, in an experimental setting. There are many existing games that are multi-player and interactive, many of them hugely successful. A small sample would include Second Life, Minecraft, EVE Online and World of Warcraft. A number of these games contain elements of the economy or financial system, albeit in a simplified form. Creating a game with a realistic economy, realistic psychology and realistic policy would not be a venture into the unknown. Robert Shiller has spoken of the role played by “narrative entrepreneurs” in catalysing and shaping the popular narratives that propagate across society. Central banks are narrative entrepreneurs, shaping views on the economy and on policy through their words, providing a hopefully benevolent “nudge” to expectations. In a world of new media, that narrative entrepreneurial role has probably never been more important.

Sources: Danker and Luecke (2005), Eijffinger and Geraats (2006), Plosser (2011), Warsh (2014), Cordemans (2015), Blinder et al (2017), Praet (2017), Bank of Japan. 36  All speeches are available online at www.bankofengland.co.uk/speeches  36  Table 2: 2013 forward guidance survey results Effect on expectations for the next change in Bank Rate Remain low for Rise sooner longer than No than Don't know previously change previously expected expected Percentages of households Percentages of companies, survey by Markit (Bank’s agents)  Percentages of households Percentages of companies, survey by Markit (Bank’s agents)  23  43  13  22  45 (47)  34 (31)  14 (19)  7 (4)  Effect on confidence Slightly No less change confident  Much more confident  Slightly more confident  1  14  56  7 (12)  51 (62)  39 (24)  Much less confident  Don't know  12  4  13  3 (1)  0 (0)  0 (0)  Sources: Bank/GfK NOP survey and Markit. See February 2014 Inflation Report for more detail on the survey questions. 37  All speeches are available online at www.bankofengland.co.uk/speeches  37  References  Acemoglu, D and Robinson, J (2012), Why Nations Fail: The Origins of Power, Prosperity and Poverty, Random House Inc. Adams, P and Hunt, S (2013), ‘Encouraging consumers to claim redress: evidence from a field trial’, Financial Conduct Authority, Occasional Paper, No.2.
A cross-border crisis situation involves several national authorities, of course, each having different mandates regarding when and how they can intervene. Even more importantly, these authorities may have different objectives to pursue, but are in all cases accountable to national taxpayers and depositors. BIS central bankers’ speeches  1  Third, and closely linked to the previous two points, the lack of private financing arrangements also poses a significant barrier to effective resolution. Even the best resolution framework needs some funds to finance the measures. However, as long as strong interlinkages exist between supervisory and crisis management policies on the one hand and fiscal policies on the other, cooperation will be hard to ensure among national authorities. As an alternative, there are many possible forms of private financing: one could use the funds of the deposit guarantee scheme, set up an ex ante resolution fund, or ensure that the creditors contribute to recapitalisation. The bottom line is that the lack of such a means ultimately undermines the effective implementation of resolution measures. Initiatives at the global level Work at the international level to address these issues is ongoing and there are some promising developments. The Financial Stability Board’s (FSB) new standard, “Key Attributes of Effective Resolution Regimes”, adopted by the G20, is a point of reference for the reform of our national resolution regimes. These key attributes aim to enable authorities to resolve failing financial firms in an orderly manner and without exposing the taxpayer to the risk of loss.

In 2017, the TCFD published its recommendations in terms of reporting. These guidelines take into account the double materiality of climate matters: both the information on the exposure of the company to climate change, and the information on the impact of the company on climate must be considered significant. Nonetheless, more progress is necessary concerning climate disclosure. A first step is the shift from ‘voluntary’ to ‘mandatory’ reporting. On June 7, G7 nations came to an agreement to make climate-reporting mandatory in line with TCFD recommendations. Mandatory requirements have been enforced in the EU since 2014, and will be extended to a larger set of corporates when the Corporate sustainability reporting directive (CSRD) will enter into force (expected to apply as of October 2022). It will also be completed by the development of a comprehensive set of EU sustainability reporting standards. The first set of standards would be adopted by October 2022. We expect that the international standards to be developed by the International Sustainability Standards Board (ISSB) will ensure interoperability with regional standards and offer common building blocks across jurisdictions and sectors. ***** Let me conclude in highlighting that we are just at the starting point of what we can do with and what we draw from those scenario analyses. Further collective work is needed to improve them. I have no doubt that we will succeed in doing so. Financial institutions need to step up their  effort to combat climate changes.
Other examples of differences in values are that European women may prefer relatively more to stay at home to look after their children than pursuing their professional careers in parallel; that older people place greater value on enjoying the fruits of their working life through early retirement rather than continuing to seek gainful employment until – or even beyond – the official retirement age. Nobel Laureate Edmund Phelps has recently investigated and sought to estimate empirically, by employing econometric techniques, the possible direct effects of deeply held values by people interviewed for the World Values Survey on some of the key determinants of economic performance that I discussed earlier: labour participation and productivity. He found, for example, that the lower number of Europeans, compared to Americans and other nationalities, stating that their job is most important in their lives is significant in explaining lower labour participation rates and lower employment in Europe (Phelps 2006). Furthermore, he found that the more people take pride in their work, the greater is their participation in the labour market, and the larger the reduction in unemployment. In other words, the evidence suggests that (1) Europeans are not as deeply involved in their jobs and place relatively lesser importance on work – compared to, say, Americans or Japanese – and (2) this fact can be directly linked to lower labour participation rates and higher unemployment rates, and thus to slower economic growth in Europe.

The bank crisis in the early 1990s is still such a recent event that I shall not dwell on it here. But it is worth noting that there was a similar crisis in the 19th century. As early as 1857 the government was obliged to intervene to safeguard the payment system in connection with a bank crisis: Skånes Enskilda Bank was threatened and finance minister Gripenstedt came to its rescue. Barely two 4  See Lennart Schön, ibid. BIS Review 10/2001  3  decades later, in 1878, another bout of excessive optimism and unduly strong credit growth led once more to a bank crisis when the boom was over. On that occasion the crisis hit Stockholm in particular. Stockholms Enskilda Bank was most vulnerable, having increased its commitments in private railroad construction in the 1870s. Government efforts saved the bank by establishing a fund in the National Debt Office so that the bank could mortgage its illiquid railroad bonds. These examples illustrate how excessive optimism is liable to lead to things getting out of hand and resulting in imbalances. The course of economic developments may then be checked for the time being but once the problems have been overcome, a new expansive phase begins. I leave you to draw your own parallels with the previous rapid price rise for IT shares and last year’s subsequent correction. The bursting of what some have called an IT bubble in the stock market is thus not the end of the new information technology’s era.
There has also been a recent shift in opinions coming out of academic research, from a broad resistance to taking financial stability into account when shaping monetary policy19 to greater openness to the view that there may be good reasons for doing so.20 Even before the financial crisis hit Europe and Swedish with full force in autumn 2008, there were concerns in the Executive Board that the credit expansion was too rapid and that housing prices were increasing too quickly so that a bubble might build up, and later burst to cause a severe recession. This was not the case in Sweden, but did happen in the United States and several countries in Europe. During the crisis years 2009–2010 the endeavour was instead to use low interest rates and liquidity assistance to the banks to avoid a credit crunch that could intensify the crisis. And we succeeded well in this. During the entire period, the banks’ total lending to households and companies in Sweden increased (see Figure 11). Put greater emphasis on the initial situation and the forecasts for the coming year We should put greater emphasis on the initial position and the forecasts for the coming year than on the long-term forecasts. At the Riksbank, considerable resources are put into analysing the state of the economy. The statistics received are analysed and commented on regularly.

The risks we face are: first that we may increase interest rates too fast or push them up too far, with an unnecessary loss of growth, and second that we may raise rates too slowly with a cost in higher inflation and potentially higher interest rates and a sharper slowdown in the end. I voted for a further increase earlier this month partly because I was not convinced that current rates would be sufficient to bring credit growth and nominal demand back to their long term sustainable path. I also felt that the impact of moving too slowly on the credibility of the regime and thus the future prospects for the economy was of greater concern, given the robust rate of growth, than an unnecessary slowdown in activity. In reviewing the position again in future months I will be watching the trends in the growth of credit and money carefully. BIS Review 73/2007  7  8  BIS Review 73/2007  BIS Review 73/2007  9  10  BIS Review 73/2007  BIS Review 73/2007  11
It thus became fully clear  BIS Review 73/1999  2  that Switzerland was going to demonetise gold and to progressively transform a part of its stock into interest bearing assets. But why did we decide to fund the Foundation with gold and not with other assets? In order to understand this, one must take a closer look at the structure of the SNB’s balance sheet. 2. From revaluation of the gold stock to gold sales 2.1. The SNB’s balance sheet If, in relative terms, Switzerland is leading among all industrialised countries as far as gold holdings are concerned, the Swiss National Bank is also a special case with respect to the structure of its balance sheet. The bulk of the SNB’s assets consist of foreign exchange and gold. Swiss franc denominated assets constitute a mere 20% of the total. Compared to the balance sheets of the Bundesbank prior to the introduction of the euro, the SNB’s balance sheet exhibits only a small proportion of domestic assets (see graph 3). Graph 3 Assets Structure of the Bundesbank and the Swiss National Bank 20% 54% 50%  30% 30% 14% BUBA  Gold  SNB  Foreign Claims  Domestic Claims  Other Assets  On the liabilities side, the most striking feature are the bank’s own capital and reserves to which will be added the revaluation gain on the gold stock (see graph 4).

The still very low unemployment rate and the low interest rate environment should continue to shore up private consumption, while investment should benefit from increased public spending on infrastructure as well as new projects in education and health. Certain capital intensive sectors look set for further expansion. The continued strong growth in permits for residential dwellings should also lead to further growth in dwelling investment. It is also evident, however, that maintaining the momentum registered in recent years is becoming an increasingly challenging feat, as a number of internal constraints already identified last year persist. The rapid economic expansion and population growth have put pressure on the country’s physical infrastructure, in particular as regards road transport and health and education facilities. Given the adverse effects of infrastructure gaps on business investment, productivity and social welfare, it should not be surprising that one of the key recommendations which IMF staff issued in January was to boost public investment, to address infrastructure bottlenecks and support medium-term growth  Page | 4  in a budget-neutral manner. This need to boost investment in infrastructure was also acknowledged by the European Commission in its assessment of the Stability Programme and National Reform Programme. In this regard, the Government’s announcement of a seven-year capital investment programme focusing on the road network is an encouraging step forward. However, given that this additional investment coincides with a booming construction sector and more stringent procedures as regards the utilisation of EU funds, the possibility of slippages should not be overlooked.
For some time now we are no longer affected by financial premiums that resulted from credibility problems in economic policy. This can be seen, for instance, in the fact that the difference in ten-year government bond yields between Sweden and Germany is much less than before (see Figure 6). The fact that interest rates and exchange rates vary relatively little despite the difficulties in forming a new government can also be regarded as an indication that the Swedish economy enjoys a high level of confidence. The fiscal policy framework introduced after the crisis in the 1990s is central to this stability and it is important to safeguard it. Creating confidence takes a long time, but it can be lost very quickly. Having said this, it does of course feel reassuring to have fiscal policy room for manoeuvre, even if one would prefer not to use it. The role that fiscal policy should play is therefore not an uncomplicated question. But I think that it is nevertheless important that the question of how to stabilise economic activity when the Riksbank's possibilities are not unlimited is brought up on the economic policy agenda. 22 Before I go on, it may be worth emphasising that yet another alternative for stimulating the economy that is sometimes mentioned – what is known as “helicopter money” – also requires interaction by monetary policy and financial stability. In brief, helicopter money involves the government increasing public expenditure or cutting taxes and this being funded by a permanent increase in the money stock.

Conclusion Our banknotes serve as repositories of the country’s collective memory, promoting awareness of the United Kingdom’ glorious history and highlighting the contributions of its greatest citizens. That tradition continues with the new £ As Austen herself advised us “You must learn some of my philosophy. Think only of the past as its remembrance gives you pleasure.” Today, we look forward to the launch of the new £ note, graced by Jane Austen, as we look back to her life and celebrate the joy she has brought, and is yet to bring, to all those who read her work. 7  The advantage of using the engraving, rather than the original portrait, is that it has sufficient detail that it can be used without requiring any alterations to the image. 8 This image is from a drawing by Isabel Bishop (1902-1988), who illustrated E. P. Dutton & Company’s 1976 edition of Pride and Prejudice. 9 Miss Bingley, Chapter XI. 10 Other features of Bank of England banknotes that aid the visually impaired include the tiered sizing of different denominations and bold numerals. 4  All speeches are available online at www.bankofengland.co.uk/speeches  4
Household debt and housing prices were a fairly hot topic on the Riksbank's monetary policy agenda a relatively long time before the global financial crisis broke out.22 Moreover, Sweden is usually regarded as one of the few countries that has in practice applied a policy that, to some extent at least, "leans against the wind".23 The dominant view prior to the crisis was that central banks should not actively try to counteract the build-up of financial imbalances, but should act forcefully once a crisis had occurred. Instead of "leaning against the wind", they should in other words make do with "mopping up afterwards" – they should "clean but not lean". Trying to take preventive measures was perceived as too difficult and too costly, while it was assumed that it would not be very problematic to quickly clean up after a crisis. After the crisis - greater emphasis on preventive measures There is no doubt that the view has changed considerably since the financial crisis.24 In many countries, the combination of high household debt and a fall on the housing market marked the start of a period of weak demand, high unemployment and very weak public finances – problems that several countries are still struggling with. Cleaning up afterwards proved to be much more difficult than anyone had thought. One lesson from the crisis is thus that one must take much more preventive action and try to counteract a development with rapidly-increasing debt and housing prices.

Banks sharply curtailed their lending. A full fledged panic had started and was spreading rapidly; the financial system was facing the threat of collapse. In light of the circumstances at the time, a bankruptcy filing by AIG would have had disastrous consequences. Federal Reserve Chairman Bernanke has stated that it could well have “resulted in a 1930’s-style global financial and economic meltdown, with catastrophic implications for production, income, and jobs.” Because of the decisions made that morning, we can never really know. Let us be clear, though, about the risks that the policymakers did know. Policymakers knew that AIG’s largest creditors were other financial firms and that those firms clearly would have been directly impacted by an AIG bankruptcy filing. But the gravest risks were not the direct exposure of other financial firms to AIG. The gravest risks related to the indirect consequences of a bankruptcy of AIG, indirect consequences that would impact millions of Americans. AIG’s role as one of the world’s largest and storied insurance companies meant that its failure likely would have had a contagion effect, causing damage as it spread throughout the insurance industry. Policy holders would be hurt. Municipalities, who were already reeling from a lack of financing options for their building projects, would have seen their financial protection disappear. Workers whose 401(k) plans had purchased $ billion of insurance from AIG against the risk that their stable value funds would decline in value would see that insurance disappear.