samchain/econo-pairs-v1 huggingface dataset:
But I fear, however, that we may not be much clearer about the general trends in demand until at least late spring/early summer next year. There are major uncertainties about global demand and about domestic saving given the need for many households to strengthen their balance  1  See Tucker PMWT (2009c), “The State of the Markets: Four Issues”, at the Association of British Insurers Biennial Conference, London. 2  For my thoughts on the idea of ‘insurance’ or ‘precautionary’ monetary policy settings, see Tucker PMWT (2006b), “Reflections on Operating Inflation Targeting”, a speech at the Graduate School of Business, University of Chicago, May 2006, (pp. 10-12). BIS Review 134/2009  1  sheets over time. And, in particular, I doubt it will be clear before then whether or not the financial system is sufficiently recovered to support what may well prove to be a more creditintensive phase of cyclical recovery. The continuing uncertainties about credit supply underline just how much an effectively functioning financial system matters to the real economy. That much has been demonstrated beyond doubt by the massive measures taken here and elsewhere to prop the system up when the vortex beckoned. Those measures have rightly drawn attention to what for too long was a neglected issue: Too Big To Fail – or, as we have also discovered, Too Interconnected, Too Complex to be allowed to fail in the way of an ordinary business. Like all truly big policy questions, this is a partly social question.

High income growth and a sharp rise in the number of households laid the basis for a sharp, long-term rise in house prices. Self-reinforcing mechanisms were also at work, generating an atmosphere approaching euphoria. People hurried to buy dwellings in order to take advantage of the rise in value. It now appears that the housing market is cooling after an almost three-fold rise in prices in real terms in the course of the past 14 years. House price inflation has been accompanied by strong growth in household debt. Household debt in Norway is now about twice the level of disposable income, making the debt-income ratio higher than ever. At the same time, saving is declining and now seems to be negative. This means that in addition to fully financing their housing investments through mortgages, households are also raising loans to finance current consumption. As I mentioned earlier, the favourable developments in the Norwegian economy of the past few years are primarily due to supply-side changes. A flexible inflation target for monetary policy – as in Norway and a number of other countries – provides a sound basis for coping with the shocks to our economy that have occurred in recent years. The aim of preventing  1  See Elisabeth Fevang og Knut Røed (2006): ”Veien til uføretrygd i Norge” (The road to disability pensions in Norway), Report No. 10 2006, Ragnar Frisch Centre for Economic Research. Norwegian only.
2  See, for example, Reinhart and Rogoff, 2011 A further breakthrough relating to the Single Resolution Mechanism was in December 2018, when the European Stability Mechanism was recognised as backing for the Single Resolution Fund, both for solvency and liquidity. 4 https://ec.europa.eu/commission/sites/beta-political/files/5-presidents-report_en.pdf 3  5/10  The EDIS as the third pillar of the Banking Union. I believe the following sentence captures in a nutshell a foundational problem of the euro. A common currency should be the reflection of a single financial system; accordingly, the same euro deposited in different banks should have the same backing and confidence, irrespective of the euro area country in which each bank is domiciled. In this respect, the start-up of the SSM and of the SRB is a significant achievement. But we should acknowledge that while deposits do not have identical backing throughout the Banking Union, we cannot consider the edifice to be complete. It is an acknowledged fact that we continue to lack one of its three fundamental pillars: the European Deposit Insurance Scheme (EDIS). Any construction needs at least three pillars to ensure its structural soundness. Likewise, I believe the EDIS would contribute to increasing the stability of the Banking Union, particularly at times of stress, which is when the resilience of structures is tested. The EDIS would have a forceful impact on citizens’ confidence.

Analysis of any of the main achievements of the Union, such as the creation of the single market or the euro, tells us that it is often better to be pragmatic and adopt less ambitious solutions instead of persisting with an impasse because a perfect agreement cannot be achieved. The Banking Union is a major step in this direction and it has been pivotal in helping us withstand the euro crisis. That said, the absence of any European deposit guarantee scheme is a reminder that the process is unfinished. Further, specific regulatory and institutional elements must be added to obtain economic benefits resulting from an increase in crossborder banking activity, thereby achieving a true “Financial Union”. As the Five Presidents report indicates, “Economic and Monetary Union today is like a house that was built over decades but only partially finished. When the storm hit, its walls and roof had to be stabilised quickly. It is now high time to reinforce its foundations.” This quote illustrates very clearly how the EU reform process often is. It is amid the storm that political pressure rises to undertake reforms that help avoid the house come crashing down; but we agree that the best time to carry out this type of work is when the sun is shining. When assessing our capacity to face future financial crises, we should not forget that the institutional framework is not yet complete. Admittedly, the foundations are not fully and firmly in place, and we should avoid lapsing into complacency.
In the long run, this project will simultaneously be an investment for improving the operations not only of the National Bank and the Ministry of Interior, but indirectly also of other institutions that are actively involved in the system for fighting counterfeiting money: the Customs Administration, the Financial Police Office of the Ministry of Finance, the Public Prosecution Office and the judicial authorities. I believe that after the implementation of this Project, our interinstitutional cooperation in the field of monitoring and prevention of counterfeiting banknotes and coins will be further developed. I believe that very soon after the completion of the project activities, we will jointly state and announce that our national system for fighting counterfeit is at a higher level, compatible with the systems of the EU member states. At the end of my speech, I would like to emphasize that I am pleased that our twinning partners in this Project are two older EU member states – Germany and Austria. Having in mind that they are direct participants in policy making, overcoming all the challenges associated with the euro since its introduction twenty years ago, I believe that in communication and cooperation with their experts we will gain knowledge that will be of great benefit for us in the process of strengthening our capacities.

I am also convinced due to the successful cooperation between the two institutions so far, which was proved as very effective in preventing the occurrence and spreading of counterfeit money in the territory of our country, and because of our readiness to continue to tackle the challenges in this segment of our work in future, as well. The commitment of the National Bank to move safely along the way to the European System of Central Banks, constantly following European standards and practices and promoting all segments of its operations, is one of the main strategic goals. That’s why I assure you that with the same level of professionalism and commitment that we approach other challenges, we approach also to the implementation of this Project, giving our maximum contribution in the implementation of the activities that will have to follow after it is finalized. We sincerely hope that soon after the country’s admission to the EU, the integrity of the euro will be protected along with the integrity of the domestic currency. Actually, that is the reason that the Law on the National Bank already incorporates provisions that regulate the tasks and powers of our institution from the date of our country’s accession to the European Union, as well as the tasks and powers that we will have after the introduction of the euro as a national currency. 1/2  BIS central bankers' speeches  Hence, this project and its success are perceived as a long-term key investment in a significant segment of our operations.
The krona thus appreciates today before moving towards the same anticipated future exchange rate as previously. However, empirical support for uncovered interest rate parity is mixed.1 As in all empirical analysis, it is difficult to isolate the effects of interest rate differentials on the exchange rate. Furthermore, there are difficulties in measuring expectations, and there may be frictions on the financial markets that mean that the relationship does not fully hold true. Be that as it may, the presence of other factors complicating the relationship is hardly reason to completely disregard it. 1  See, for example, Chinn and Meredith (2004) for an outline and Lothian and Wu (2011) for a recently published empirical study. BIS central bankers’ speeches  3  The exchange rate is volatile Another circumstance complicating the analysis is the tendency for floating exchange rates to be highly volatile. This is illustrated in Figure 3, which shows the development of the krona’s trade-weighted exchange rate. The figure shows that the krona can both depreciate and appreciate to a relatively large degree over relatively short periods. For example, the krona depreciated by almost 20 per cent in TCW terms between the second quarter of 2008 and the first quarter of 2009. Unease on the financial markets, which tends to weaken comparatively small currencies like Sweden’s, contributed towards this. Following this, the krona appreciated strongly and now lies at approximately the same level as prior to the financial crisis.

Changes in the real exchange rate mainly affect the economy via net exports, in which a weakening of the real exchange rate tends to increase net exports. Slightly simplified, it could be said that higher net exports lead to increased resource utilisation, higher wage growth and thus to higher inflationary pressures. The exchange rate effects arising in inflation via net exports can thus be seen as being significantly less direct than those arising via import prices, which I discussed earlier. Changes in the real exchange rate may entail adjustments to the economy that monetary policy may need to consider. For example, during a real appreciation of the krona, exporting and import-competing firms may have to review their costs so as to restore competitiveness. Among other strategies, the firms can achieve this by implementing operational changes to increase productivity.10 Such adjustments can contribute towards lower inflationary pressures, as increased productivity lowers unit costs. Another possibility for some firms is to move operations overseas. For major firms with broad international operations, it may be relatively easy, in some cases, to reorganise operations so that costs arise in another currency than Swedish kronor. However, for smaller firms with all of their production in Sweden, relocating operations overseas is generally associated with high costs. Monetary policy decision-making in consideration of the exchange rate I would now like to say a few words about how everything I have said so far about the exchange rate affects my view of monetary policy analyses and decisions.
These measures consider not only sentence length but also the number of polysyllables (words of three syllables or more) and the average number of syllables per word. 14  BIS central bankers’ speeches  might be for banks in future to begin publishing self-assessments of their culture, so that customers could have some better sense of the progress being made. If these are important communications lessons for financial services serving society, they are no less important for public policymakers serving society. Let me take my home institution as a case study here. That is not because I believe it is an outlier – if anything, I think the Bank is at the frontier of central bank best practice on transparency and openness. It is simply the example I know best. The Bank has made considerable efforts to improve its openness and transparency over the past few decades, including through published reports of its analysis and decisions, published minutes of those decisions, speeches and Parliamentary appearances. To bring that point home, consider a simple measure of transparency as it applies to monetary policy: the number of words used to describe a policy decision. Back in 1989, when I first joined the Bank, monetary policy decisions were made by the Treasury. Their public communication typically took the form of a press release, usually comprising no more than a few hundred words. Ten years on, the monetary policy world had changed.

And we cannot, even if we wanted it, have a single standard. But we collectively have to ensure that these standards are interoperable: as a bottom line, when an entity complies with a set of requirements from any jurisdiction, it should mean that it also complies with the global baseline provided by the ISSB. None of the major sets of norms are carved in  3/4  BIS - Central bankers' speeches  stone; the EFRAG and ISSB are fortunately working hard towards convergence, and making strong and quick progress. As a complement to stress tests, relying on robust transition plans from banks and insurers is the best way forward. It would allow for a dynamic, holistic and risk-based approach, which in my view is far preferable to static and not risk-based greensupporting and brown-penalising factors. The question now is how to "operationalise" stress tests and transition plans into capital requirements. In my view(viii) the simplest and most international way forward is to integrate them into Basel capital requirements, in Pillar 2 on risk governance, business model and credit risk as a first-stage approach. ** To conclude, let me recall what the avant-garde fashion designer Issey Miyake inspiringly said: "Many people repeat the past. I'm not interested. I prefer evolution." Today's shifting world gives even more credit to this Japanese master, who relentlessly navigated between Tokyo and Paris, designed Steve Job's black turtlenecks in which he delivered his keynote speeches, and stood as a pioneer of fashion tech and ecology.
In this regard, a month has been provided for commercial banks’ training ending 5 May 2004. All banks are reminded to ensure that they submit names of nominated officers to the Assistant Director - Payment Systems as soon as possible to enable the training to start according to schedule. Piloting of the RTGS system •  The piloting of the system is scheduled to commence on 27 April 2004. It is therefore cardinal that the entire industry moves in unison on this project. As indicated to commercial banks at the last meeting, the training of both Bank of Zambia and commercial banks staff and the execution of the pilot project have been arranged close to each other to enable the quick and effective transfer of acquired skills to staff’s “desks” or operational areas. Therefore, the need for all banks to move at the same pace cannot be over emphasised. Counterfeits •  We would like to alert you all that there are people trying to encash counterfeit notes and as banks you are the most vulnerable. It is therefore incumbent upon all of your members of staff to be vigilant when handling incoming cash. The incidence of the counterfeits is suspected to affect other locations beyond Lusaka as such even your outlying areas must be alerted. You should urgently report such cases to the Zambia Police Service.

As part of the outlook, there are two important events that will be forthcoming. These are: The upcoming IMF mission •  We wish to inform you that the IMF mission will be in the country during mid-April to assess progress made against the Staff Monitored Programme (SMP) with a view to consider Zambia’s return to a PRGF. It is therefore, our hope that nothing will be done in the market to reverse the many successes that we have achieved thus far because we all need the programme which will not only lead to the country reaching the much anticipated completion point under the enhanced HIPC initiative, but also bring along other benefits, such as, increased supply of foreign exchange in the economy. The Country Assistance Strategy (CAS) •  In addition, a Country Assistance Strategy (CAS) for Zambia was recently approved by the World Bank Board. Here too a lot of praise was given to our achievements but with caution as more work needs to be done in our economic programme. The approval of CAS for Zambia means that some substantial funding will be released beginning soon and will spread over a relatively stretched period. This will help ease the situation given the resource constraints that the country is facing, especially to fund capital and related projects. 8  BIS Review 27/2004
To take it one step further, we are prepared to take a liberal view if an overseas bank wishes to engage in both retail banking through a subsidiary and, in parallel, corporate or private banking that would more appropriately be conducted through a branch. We have had several precedent cases and the HKMA is prepared to consider applications on the basis of the merit of the case. 18. While we maintain an open mind on the use of branches by overseas banks, we have to take steps to mitigate the potential risks arising from cross border contagion. This is particularly important given that Hong Kong is a net provider of funds, i.e. our banks collect a lot more customer deposits than they lend out locally. Hong Kong therefore has to closely monitor intra-group or inter-bank funding that flows from Hong Kong to overseas centres. We have seen in the Global Financial Crisis very clearly how wholesale funding through this kind of cross border intra-group or inter-bank channels may be susceptible to significant shocks in times of market stress. The problem could be exacerbated if the host supervisors, in selfdefence, sought to ring-fence domestic liquidity by blocking the flow of funds at the most difficult time. So the HKMA has been in discussion with banks in Hong Kong on how best they could achieve a better match between liabilities derived from Hong Kong and assets booked in Hong Kong.

This can be described as the difference between what a family will need to maintain its level of consumption should a breadwinner, or one of the breadwinners, passes away, versus the amount of financial resources including life insurance coverage. A Geneva Association report1 in 2014 estimated that for the US alone, the life protection gap was a staggering $ trillion. In 2012, the LIA estimated the gap in Singapore to be about $ billion2. Patrick mentioned this as one of the priorities for LIA and highlighted that a follow-up “attitudinal study” will be conducted. I understand that LIA’s 2017 Protection Gap Study will be released later this month. The case for adequate life insurance protection is a strong one. So why is there such a large protection gap? Let me highlight a few possible reasons. 1/5  BIS central bankers' speeches  (1) One factor is that life insurance involves the rather unpleasant topic of death, a morbid subject that many avoid. (2) Another common feedback is that many people find it difficult to properly ascertain their insurance coverage, given the difficulties in projecting long-term financial needs. (3) Yet another perception is that life insurance policies are both expensive and complex. There is also a belief that agents would rather sell more lucrative investment-linked policies compared to term life policies.
We are again at a similar junction. A wide array of economic indicators now suggest that growth in the U.S. has picked up and is widely expected to be around 3 percent during the second half of 2014 and in 2015. These forecasts seem quite reasonable to me and are consistent with views I have expressed in the past. Various “headwinds” have been impeding economic activity, but some of these forces have gradually subsided, allowing the substantially improved underlying fundamentals to exert themselves more forcefully. For example, fiscal restraint, which was a big factor last year, has subsided and is likely to disappear altogether next year. Credit availability has also improved, reflecting healthier bank balance sheets and improving job and income prospects for prospective borrowers. In addition, the excess supply of housing built up over the boom of the previous decade has been worked off, and both home prices and rents suggest that the supply of housing is not keeping pace with demand. This has allowed supportive financial market conditions, spurred, in part, by a very accommodative monetary policy, to shine through. As a result, aggregate household net worth has climbed relative to income and consumer balance sheets are healthier. On the business side, financial markets conditions suggest that risk aversion has subsided, leading to some firming in business investment spending. All of these developments help boost the confidence of consumers and businesses that this consensus forecast will in fact unfold.

Of course, as with any forecast, there is some meaningful chance that growth will be either weaker or stronger than the point forecast. While I believe that the risks around this consensus forecast are reasonably well balanced, I also believe that the likelihood that growth will be substantially stronger than the point forecast is probably relatively low. Several factors lead me to this conclusion. First, despite the fact that the household deleveraging process appears to be largely over and aggregate household net worth has been restored to pre-crisis levels, consumer spending is not as strong as one might expect given these conditions. As a result, the personal saving rate is currently significantly above what the historical relationship between household net worth and personal saving would suggest. There are several potential explanations for this development. Access to credit, while certainly improved, is probably still not fully restored, particularly for those with less than sterling credit histories. It is also quite likely that, in the wake of the deep recession and relatively sluggish growth of the past five years, households have higher than normal levels of precautionary saving. Another reason for seeing less than normal upside risk for consumer spending is that the growth stimulus from the consumer durable goods cycle is likely to weaken going forward. For example, sales of light-weight motor vehicles have steadily recovered from a low of 9.4 million units (annual rate) at the depths of the recession to an average of nearly 17 million units over the three months ending in September.