samchain/econo-pairs-v1 huggingface dataset:
Excessive debt is namely a common denominator in most financial crises. Even before the crisis, a number of banks expanded their operations substantially with the aid of debt financing. When the markets became shaky it turned out that many banks lacked sufficient capital to cover their losses. The idea of the leverage ratio requirement is that it should be a relatively simple and transparent supplementary capital requirement that sets an upper limit as to how much leverage the banks can take on. Basel II created too much freedom for the banks, with well-known results. We need to put this right. We will therefore now have a system with many different types of constraints. Government exposures are also risky Another question discussed by the Basel Committee is if and how the banks should maintain capital to cover their exposures to governments and other public bodies. Today it is in practice possible for the financial supervisory authorities to completely exempt such exposures from the capital adequacy requirement. We know from experience, however, that the banks’ exposure to governments is not risk free. The Basel Committee has therefore decided to review whether and how the regulations need to be changed. Almost 10 years on from the crisis – time to complete reforms The international regulatory work has been in progress since the global financial crisis broke out in 2007. It is important to many parties, not least banks, investors and policy-makers, to clarify how the global regulatory framework for banks will function.

By contrast, in some other member states in the euro area there have been explicit calculations about how much additional capital would need to be infused into banking systems in order to meet those requirements. This is testament to the very strong capital position of our banking system. Regarding steps to limit exposure by any of our banks to any sovereign holdings in the euro area, as part of the supervisory process of the Central Bank of Cyprus we demand that all of our banks have good risk management systems in place. Of course, we do not control the specific decisions on portfolio holdings of banks. Whenever we determine that there is undue concentration of risks then we demand that additional capital be held in order to account for these risks. This way we manage risks to the system. Q. Do you agree with an assessment recently made by Cypriot officials and the finance minister to be precise, that his hands are actually tied in terms of future ratings of the Republic if rating agencies continue to make a linkage between the economic fortunes of Greece and the economic fortunes of Cyprus, and do you think that this linkage is appropriate? In my view, all authorities must live up to their responsibilities. What we are experiencing in Cyprus over the past many months is a very unfortunate cycle of downgrades of the sovereign.
The new capital regulation is an attempt of precise risk measurement, including but not limited to the credit risk, and its reflection in the capital requirements. Newly emerging institutions operating in several segments and on several markets increase the operational risk. It seems that the scale of threats related thereto grows in line with the technological development. Globalization of financial markets and relations among institutions of various segments trigger a disruption that may bear consequences not only for individual institutions, but which may, through the payment system, spread over to many other entities, including those in the real sector. 43 The operational risk problem has been noted by the Basel Committee on Banking Supervision, which for the very first time has included it in its supervisory regulations (the New Capital Accord). Banks and investment funds have been obligated to gather information on operational risk incidents and to estimate capital to cover this risk. Capital mobility and business activity of large, international financial corporations also translate into institutional changes on local markets and challenges to be faced by supervisory authorities responsible for financial stability. Financial markets of the new EU Member States, whose large share is held by foreign investors, i.e. institutions operating globally or regionally, may serve as an example. In addition to the capital necessary for the development of the institutions and markets on which they operate, the presence of industry institutional investors has brought about a number of other positive results.

Second, the progressive normalisation of the real estate market, against a background in which the demographic factor and the buoyancy of employment are lending greater support to housing demand than in previous property cycles, would limit the effect of slower house price rises on consumption and soften the impact of the cyclical change on residential investment. At the same time, the step-up in private- and public-sector investment in recent years has raised the level of capitalisation of the economy following a prolonged period of intense job creation, and this should manifest itself in higher long-term potential growth. Although it is unlikely that the expansion of business investment and non-residential investment in construction will maintain the pace of recent quarters, the growth outlook for both spending components is, at first sight, favourable. In any event, it seems unlikely that productive investment alone can offset the lower contribution from household spending. Hence, as I pointed out in my previous testimony, the role of net external demand will be fundamental in making some containment of spending compatible with a continued growth rate of around 3%. As we have seen in the last few years, the contribution of this variable to growth depends very much on the performance of Spain’s export markets, but also on the competitiveness of Spanish production.
The creation of such a mechanism is undoubtedly the first task awaiting the countries of the euro zone that I wished to highlight. This mechanism is pivotal insofar as the euro members share a common monetary policy regardless of their different positions in the economic cycle. Secondly, it is also essential to conclude the Banking Union, in particular by reaching an agreement to achieve a truly and fully mutualised European Deposit Guarantee Fund to guarantee financial stability and address financial fragmentation. Thirdly, it is necessary to move towards the implementation of a true European Capital Markets Union, eliminating the barriers currently in place (such as the differing insolvency regimes in each country). It is important to bear in mind that European capital markets are underdeveloped and poorly integrated when compared, for example, with those of the United States. We cannot allow ourselves to miss the “opportunity” that this crisis has offered us to internally strengthen our common European project and strongly project our values and interests to the world. It is time to take decisive steps towards greater European integration in order to reinforce the European project and play a leading role in strengthening multilateralism. It is the appropriate way to emerge stronger from this serious crisis. Only in this way will we be able to offer a brighter tomorrow for future generations.

He also serves as an Associate Editor at Econometrica and as a member of the Board of Editors at the American Economic Review. He earned a Ph.D. in Economics from Harvard University in 2010. Prior to Harvard, he received an undergraduate degree from the Athens University of Economics and Business in Greece. In addition to this Bernácer prize he has received numerous honours and awards. These include a Sloan Research Fellowship awarded by the Alfred P. Sloan Foundation and the Excellence Award in Global Economic Affairs, from Kiel Institute for the World Economy. For those who know him he is a tireless worker and a perfectionist, who always dots his i’s and crosses his t’s. But he is also very approachable, a man of great humour and always very generous with his time. He combines a brilliant mind and outstanding organisational capacity with great didactic skills. One of his assets is how passionate he is about what he does, transmitting his knowledge and inspiring those around him. Loukas Karabarbounis is one of the most highly cited young macroeconomists in academia, and his research interests comprise macroeconomics, labour economics, and international 1  finance. His latest research has focused on topics such as the global decline in labour's share of income, productivity and capital flows in southern Europe, and the effects of unemployment insurance policy on macroeconomic outcomes.
Jacqueline Loh: A coordinated and forward looking approach towards ASEAN disaster and climate risk resilience Keynote address by Ms Jacqueline Loh, Deputy Managing Director of the Monetary Authority of Singapore, at the NTU-ICRM's 10th Annual International Symposium on Catastrophe Risk Management, Singapore, 1 August 2019. * * * Distinguished guests, ladies and gentlemen, Good morning. Introduction 1. It is my pleasure and honour to join you today at the 10th anniversary of the NTU Institute of Catastrophe Risk Management (ICRM)’s annual symposium. Since its establishment in 2010, ICRM has come a long way to become one of Asia’s leading research institutes in catastrophe risk modelling and management. 2. The theme for this year’s symposium - “Towards Viable Disaster Risk Financing Solutions for Southeast Asia” - is a timely one. In the face of growing climate and disaster risks in the region, it is a pressing priority for all of us to come together to tackle the widening natural catastrophe protection gap, and contribute towards a sustainable and resilient future. Reaching Boiling Point 3. Asia has borne the brunt of catastrophe disasters. Over the last 50 years, Asia accounted for half of the world’s economic losses from natural disasters, amounting to more than $ trillion. In 2018, Asia was again the worst affected, beset by a number of significant events, including: Typhoon Jebi and Trami, which affected Japan and Taiwan, Typhoon Mangkhut, which impacted mainly Hong Kong, China and Philippines; and the Earthquakes and tsunamis in Sulawesi. 4. Natural disaster losses are high and rising.

To underpin the payment reforms undertaken by the Central Bank and enhance integrity and safety of such systems, a comprehensive legislation to govern payment, clearing and settlement systems in general and to provide the Central Bank with oversight and regulatory powers over various payment systems and money transfer service providers has been enacted through the Payment and Settlement Systems Act of 2005. The Act empowered the Central Bank to be the authority responsible for the national payment system, which requires oversight and continuous surveillance of all payment systems to ensure its efficiency and effectiveness. The systemically important payment systems will be reviewed periodically to ensure that the design and operation meet with international standards and best practice. Some of you may be aware that a couple of months ago, the Central Bank established a National Payments Council which is the highest decision making body with regard to payment systems. This committee represented by all stakeholders provides a forum for constant dialogue on payment issues to take place within the industry. The National Payments Council is responsible for developing the payment and settlements infrastructure in collaboration with all the relevant authorities and stakeholders. Currently, it is in the process of finalizing a road map for the development of the national payment system in the next five years, which will be in line with the vision of the financial sector.
On the other hand, supplementary pensions may be financed by a fund where the pension is determined by the individual’s contribution to the pension fund and the return on the fund’s investments. Labour is our most important resource. The decline in average hours worked cannot continue if we are to have a sustainable pension system. The current evaluation of our public pension system must focus on the incentives to work and the effects on the average retirement age. A fund-based system may be an appropriate approach and at the same time make pension savings transparent for each individual. This may in itself provide an incentive to increase working hours. Conclusion The Norwegian economy is changing. Even a gradual increase in the use of petroleum revenues will change the industry structure substantially in the next decade. It appears that we may see an increase in locally determined wages. This will generate considerable gains, but in the absence of reforms in the labour market and in the social security and pension system, the growth potential and sustainability of our economy may weaken, labour may be displaced and unemployment may rise. Monetary policy provides the economy with a nominal anchor. The guidelines hold the promise of a fiscal policy that is anchored in a long-term strategy. When fiscal policy is predictable, monetary policy can also contribute to stability in aggregate demand and output. The social partners, businesses, borrowers and investors can act on the assumption that the inflation rate will be 2½ per cent.

The exchange rate therefore serves as a buffer against changes in the terms of trade. Norway’s terms of trade also fluctuate considerably, primarily reflecting changes in oil prices. However, a substantial portion of petroleum revenues is invested in foreign equities and bonds through the Government Petroleum Fund. Changes in oil prices influence the size of the Fund, but have little effect on the use of petroleum revenues at home. The Government Petroleum Fund thus serves as a buffer against swings in the oil price, and thereby stabilises the krone exchange rate. The Norwegian economy may nevertheless be exposed to disturbances of a type that cannot be absorbed by the Petroleum Fund. We have to be prepared for fluctuations in the value of our currency that are more in line with the fluctuations observed in other countries. The exchange rate will vary. This means that economic agents cannot assume that the krone will be stable against the euro, the US dollar or a weighted average of foreign currencies. It is the inflation target that is the economy’s nominal anchor. The increase in labour costs is important when Norges Bank’s assesses the outlook for price inflation and sets interest rates. High wage growth, both in manufacturing and other sectors, will affect the internationally exposed sector through two channels. First, high wage growth will weaken earnings and employment. Second, the interest rate will be increased. Normally, this will lead to an appreciation of the krone, with a further weakening of earnings and employment.
The European and French economies are therefore likely to suffer a significant slowdown next year, and the possibility of a limited recession cannot be excluded. But growth is expected to resume in 2024. I turn now to our assessment regarding the recent developments of inflation in the euro area. The rise in consumer prices has amplified in recent months in the euro area, reaching 9.1% in August according to the harmonised index of consumer prices. In France, inflation levelled at 6.6%, the lowest level in the euro area, thanks in particular to the tariff shield, but still stands at three times the inflation target of the Eurosystem. The flash estimates for September didn't bring a fundamental change to this landscape as inflation reached 10% in the euro area, and the mild levelling off in France was confirmed with a figure of 6.2%. In our view, the current surge in inflation has its roots not in excess liquidity, but in supply bottlenecks stemming from the faster-than-expected rebound in activity in the aftermath of the pandemic, and the sharp rise in energy and food prices, which was greatly exacerbated by the war in Ukraine. The inflation we are currently seeing is largely imported, and much of it - about twothirds for the euro area - is driven by energy and food prices. The recent surge in international gas prices has led the ECB to predict a peak in inflation by the end of 2022.

In particular, there is no sign of a potential wage-price loop that could be at play. This imperative to anchor inflation  3/4  BIS - Central bankers' speeches  expectations helps explain why the ECB raised key interest rates by 125 basis points in total over the last two policy meetings. As Christine Lagarde stated, the appropriate pace of future rate increases will be decided on a meeting-by-meeting basis. Indeed, as she has repeatedly emphasised, it will remain data-dependent in all scenarios. As the current drivers of inflation fade over time and the normalisation of monetary policy works its way through to the economy and price-setting, inflation will come down back to 2%. When will that be? Will it be necessary for the Eurosystem to significantly tighten its monetary policy? First, let me just note here that ECB projections released in September have significantly revised up their inflation projections and inflation is now expected to average 8.1% in 2022, 5.5% in 2023 but 2.3% in 2024. Second, market participants are not for the time being pricing in a strong tightening of ECB policy rates, with central expectations for the terminal rate being slightly below 3%. To conclude this rapid overview of the current macroeconomic situation in the euro area and its monetary policy implications, let me stress first that the change of course of monetary policy underway brings with it multiple dimensions that will need to be revisited, including the TLTRO operations, the remuneration mechanisms of banks reserves, and more broadly our operational framework.
Where development needs are identified through FIDE Forum’s screening process, it should be able to refer candidates to the existing director education programmes provided by ICLIF, or work with ICLIF to develop new ones to respond to an unmet need. To my mind, this clarity of role and purpose will significantly enhance the potential impact and influence of FIDE Forum and ICLIF, to the overall betterment of the industry. As members of FIDE Forum, directors have a critical role to play in setting its priorities and in driving future initiatives to ensure that FIDE Forum remains relevant and continues to add value. In this respect, members should be active in giving their views, including providing inputs to concept members, engage in propagating the common interest of the industry and enhancing the good image of the sector. Conclusion The Malaysian financial sector has taken important strides to strengthen boards, in particular through the ongoing education and increase in supply of top-quality directors. The success of ICLIF’s FIDE Programme and the industry-led initiatives by FIDE Forum in pushing frontiers in developing, sourcing and attracting board-level talent would very much depend on the collective efforts of all. It is from this perspective that the FIDE Forum should be commended for initiating this effort. I encourage the industry to continue to use FIDE Forum as a platform for promoting board-level talent management and through it, to build an effective partnership with ICLIF as the centre of excellence for directors’ education in the financial sector.

FIDE Forum should continuously raise the bar on director performance by advocating best practices and providing support to its members in helping solve real problems confronting boards today. It should be a respected voice on important issues of corporate governance, an epitome of best practices of corporate Malaysia. Most importantly, it should build an enduring legacy for future leaders of financial institutions by representing within its collective membership the highest standards of integrity, professional conduct and intellectual integrity. Indeed, FIDE Forum’s success must surely be measured not only by how well it serves its current membership, but also by how it expands its reach and influence to attract new leaders of the highest calibre to the financial industry. In short, being a director of a financial institution signifies the embodiment of a person’s self-evident integrity and professionalism. In this endeavour, FIDE Forum and ICLIF need to work collaboratively and exploit the synergies between them. FIDE Forum should leverage on the expertise that has been built within ICLIF in the design and delivery of high quality leadership programs. Similarly, ICLIF should continuously seek to understand the current and future concerns of directors through FIDE Forum, and reflect on how its role in education can help address those concerns. These are mutually reinforcing perspectives. The Directors Register is a good example of this.
11 Two weeks ago, at a forum of the International Conference of Banking Supervisors, Sir John Vickers (who oversaw the Vickers Report to reform the UK banking market) shared his views that the Basel III capital requirements are not stringent enough, and have not sufficiently reduced the likelihood of crises as intended. I am not saying that this is the view of the MAS. I am sure that many bankers will disagree. But the point is that this is an area which is deserving of greater discourse. 12 Evaluating the effects of the banking reforms will be a key exercise. One set of issues revolve around whether the reforms are having the intended outcomes or, on the other hand, whether there are unforeseen and undesirable effects. This will involve an assessment of banks’ behavioural responses, whether there are new forms of arbitrage strategies, and the spillover effects on the broader economy. Cross-border lending to developing economies 13  One example relates to the impact on cross-border lending to developing economies. 14 There are studies that indicate that some global banks have reduced their presence and activities in developing economies as part of their business review, and some have attributed this to the banking reforms. Establishing a clear, causal link between the declining trend in crossborder bank loans to developing economies and the post-crisis reforms will be helpful, if possible. 15 Such investigations can support the Basel Committee’s work on a full, timely and consistent implementation of the reforms globally.

It is also not unreasonable to expect that traditional business lines between financial services, general commerce or telecoms will increasingly be blurred – and activities may concentrate in the biggest institutions with superior competitive advantages including in the areas of talent, customer base, and customer data. The FAANGs and BATs of this world – the technology giants – come to mind. These may also have implications for financial stability. Indeed, the next systemically important institution could be a BigTech with roots in e-commerce, and therefore, whether such entities require some form of oversight by financial regulators in future. 33 With the increasing use of artificial intelligence (AI) and various forms of data analytics (DA), another area of focus will be around the governance of their use. The MAS recently released a guide that we co-created with some industry partners on a set of principles for Fairness, Ethics, Accountability and Transparency (or FEAT) in the use of “AIDA”. Whether and how the increasing use of machine-learning systems (both supervised and unsupervised), algorithms and data-driven insights can affect behaviours and decision-making in financial institutions will be a rich area for research and attention. Regulators generally like the idea of deploying smart systems that can do a better job in risk detection or risk management. But what about for business decisions or say, personnel decisions? Whether AI-driven systems will perpetuate bias and discrimination is also ripe for more extensive studies.