samchain/econo-pairs-v1 huggingface dataset:
Money laundering has a wide range of adverse effects on any country’s economic, political and social structures. Since laundered money passes through the financial system, money laundering also has several effects on the financial systems as a whole and banks in particular. Some of the effects include: •  First, undermining legitimate private sector efforts. Money launderers use front companies, to disguise the proceeds of illicit activities and in the process hide the ill-gotten gains. These companies have access to substantial illicit funds, therefore allowing them to subsidize the front company and offer it’s products and services at levels below market rates. At times they quote prices, which are below production cost. This explains why front companies have competitive advantage over companies that source their funding from the financial markets. This makes it difficult, if not impossible, for legitimate business to compete against such companies. This situation may lead to the crowding out of legitimate private sector businesses by criminal entities. Clearly, such criminal enterprises would not adhere to good corporate governance practices as legitimate businesses would. •  Second, loss of control of economic policy. As already alluded to, the magnitude of money laundering is between 2% to 5% of world output. In most developing economies, like ours, these proceeds may dwarf government budgets, resulting in loss of control over economic policy by such governments.

Essentially, the Principles seek to control money laundering by cutting across the multiplicity of jurisdictional issues and addressing the serious reputation damage they were suffering in the media because of money laundering. Ladies and Gentlemen, allow me now to discuss our local initiatives/responses to money laundering. Admittedly, there has been little activity in the areas of prevention of money laundering in Zambia, until quite recently. This exposed the country to the activities of money launderers because they always seek to operate in countries where there are lax controls. However, the major initiatives in the fight against money laundering, locally, have included: •  Enactment of the Prohibition and Prevention of Money Laundering Act. The Government of Zambia responded to the increase in drug trafficking and money laundering by passing the Prohibition and Prevention of Money Laundering Act in 2001. The Act provides for the disclosure of information by supervisory authorities and of regulated institutions if suspected of money laundering activities. The Act also provides for the forfeiture of property belonging to persons connected to money laundering offences as well as for the prosecution of persons connected to or charged with money laundering offences. The Money Laundering Act places certain obligations on the Bank of Zambia as the supervisory authority. One of these is the issuance of regulations to commercial banks as and when necessary in order to prevent money laundering. •  Regulatory responses.
Simultaneously, the Fed tried – and I emphasize tried because the message seems to have been garbled in the minds of some intended recipients – to influence expectations of its own behavior once asset purchases have run their course. These “asset-purchase” and “forward-guidance” policies are relatively unfamiliar, and their impact is uncertain. 6  See “Assessing the Costs and Consequences of the 2007–09 Financial Crisis and Its Aftermath,” by David Luttrell, Tyler Atkinson and Harvey Rosenblum, Federal Reserve Bank of Dallas Economic Letter, vol. 8, no. 7, 2013, www.dallasfed.org/research/eclett/2013/el1307.cfm. 4  BIS central bankers’ speeches  One implication is that aggregate fiscal shocks – and, hence, also aggregate fiscal uncertainties – are likely to have outsize effects in current circumstances. Contractionary fiscal policy that would ordinarily drive down interest rates, providing offsetting stimulus to private expenditure, will have a larger-than-typical economic impact because this “crowding in” is absent once interest rates are confined to the zero lower bound. Expansionary fiscal policy, similarly, will fail to “crowd out” private expenditure if interest rates hold steady. Second, because the zero bound complicates the conduct of monetary policy and shortcircuits fiscal crowding out, it introduces a “kink,” or discontinuity, in the economy’s behavior. The existence of a kink means that uncertainty matters even if ordinarily it would not: “Certainty equivalence” no longer applies. When real growth and/or inflation prospects are weak – so that the economy is operating near the zero bound – downside risks to growth and inflation loom larger than they ordinarily would.

Indeed, interest on the public debt has trended downward from 4.7 percent of potential GDP in 1990 to 3.2 percent in 2007 to just 2.1 percent in 2012 as the average interest rate on Treasury securities has dropped from 9 percent to 5 percent, then to its recent level of 2½ percent. Rates obviously cannot continue to fall, though, so the cost of servicing debt is sure to increase, even if the size of the debt relative to the economy stabilizes. The canary in the mine: capital investment Capital investment is the economy’s canary in the mine because it’s often the first thing to succumb to uncertainty. Also, once undertaken, capital investment is costly to reverse. Investment has certainly been unusually sluggish in the wake of the recent recession. Going back to when our data begin, in 1947, net investment as a percent of GDP has fluctuated around a constant mean of 5.6 percent.4 It boomed in the late 1990s, reaching 8.1 percent of GDP, its highest level in over 50 years. The only higher quarter on record was the second quarter of 1950 (shortly after John Taylor and I came into this world, although I am not implying causality). Its peak during the 2001–07 expansion was an unremarkable 6.9 percent, but the subsequent plunge was unprecedented in the post-World War II data: The U.S. capital stock actually shrank during the second half of 2009.
With the economy gaining strength, macro policies such as the OPR must be adjusted. This is necessary to ensure that our broad macro policies match our economic realities. At the same time, we recognise that although the overall economy is in good health, there are some who are still facing economic challenges. However, given that the OPR is by design a blunt tool to deliver price stability, more targeted measures are in place to help those who may be facing difficulties in meeting their monthly loan repayments. Help continues to be available through banks or AKPK, which can work out new repayment arrangements tailored to individual circumstances. In this way, policies can work to deliver what the economy needs. By acting sooner rather than later in managing inflation, we have been able to move in a measured and gradual way, avoiding large and more disruptive adjustments which would have been much more costly for the economy. We are still experiencing high and elevated inflation, partly due to strong demand. Yes, some cost pressures are coming down, but it has not translated to the final prices of goods because demand remains high. The cost of making nasi lemak has probably eased but with people still queuing as far as 100 metres for Akak Nasi Lemak, as widely shared on TikTok, prices are unlikely to come down as long as demand stays strong. If we do not manage excessive price pressures like we see in some other economies, this will affect everyone through lower purchasing power.

BIS Review 21/1997  -7-  HM Treasury  Insurance Supervisor  Insurance Companies  Consolidated Securities and Investments Supervisor(s)  Investment Firms, Markets and Exchanges  Bank of England  Banks  This last is not a trivial point, since the cost and disruption caused by reorganisation would be considerable, and higher in proportion to the degree of change. The process would inevitably generate uncertainty among firms and the public, and make the regulatory system more difficult to manage in the meantime. This argues for building on the present arrangements, if at all possible, rather than beginning again with an entirely new structure that could take years to settle down. Furthermore, what matters to the financial system, and to the public, is that regulators are effective. Effectiveness necessitates good communication, consolidated supervision and close co-operation to maintain protection across the piece. Whether structural change (including bringing functions together under one umbrella) would improve communication and co-operation and so increase effectiveness, is a key question, and the answer is far from clear. We have been making considerable efforts recently to enhance communication between different supervisors in the UK. That has involved, as you would expect, the usual paraphernalia of Memoranda of Understanding. But, in addition, we have sought to achieve cross-membership of some of our most important institutions. For example, Sir Andrew Large, the Chairman of the Securities and Investments Board, has become a member of the Bank of England’s Board of Banking Supervision and, reciprocally, I have joined the SIB.
The dynamics of financial markets are also  Chart 13: Distribution of corporate bond price returns  an area of active policy interest, not least in the light of the financial crisis. During the crisis, there were sharp swings in asset prices and liquidity premia in many financial markets. Since the crisis, there have been concerns about market-makers’ willingness to make markets, potentially impairing liquidity. These are policy questions which are not easily amenable to existing asset pricing models. Braun-Munzinger et al (2016) build a model which seeks to capture some of the  Source: Braun-Munzinger et al (2016). Notes: The distribution function of daily log-price returns of three periods shown against data generated by a single model run. interactions between market players that might give rise to these asset price patterns. In particular, the model comprises three classes of agent: a market maker, making two-way prices in the asset; a set of funds trading in the asset, but pursuing distinct trading strategies; and end-investors in these funds. 32  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  32  Funds are, in turn, assumed to be one of three types: value traders – who assume yields converge over time to some equilibrium value, buying/selling when the asset is under/over-valued; momentum traders – who follow short-term trends on the assumption they persist; and passive funds – who only trade in response to in- and out-flows from investors. These interactions are shown schematically in Figure 18.

While the adjustments in housing market are also ongoing in Europe, and some European Banks have reported losses in CDOs, the impact on economic activities is expected to be more limited. For example, Consensus Forecasts in February, revised downward the Euro Zone’s GDP growth for 2008 by only 0.3 percentage points from December compared with a 0.5 percentage point downward revision for the US. For Southeast Asia, the impact is also forecasted to be limited. Latest consensus forecasts for Southeast Asia’s GDP growth is 5.7 percent for 2008, declining slightly from the forecast of 5.9 percent in December last year. These forecasts, together with the latest data, suggest that, in the short-term, things will likely get worse before they get better, and the slowing of growth in the US will impact growth globally. The key question, at this time, is how deep can things get before we see a turnaround. This is definitely an important, but a difficult question to answer. Market  BIS Review 29/2008  1  participants as usual will have a range of views, and I personally do not intend to offer another prediction. Instead, I want to share with you my thoughts on the current developments and on what this will mean for Thailand. To begin, one context that I think is useful in understanding the current turmoil is the unwinding of the global imbalance, triggered by corrections in the US housing market that began in 2006, and is now ongoing.
In Malaysia, solutions tested in the Bank’s regulatory sandbox enabled the Bank to design regulatory safeguards that would allow the implementation of end-to-end electronic know-yourcustomer processes for the provision of remittance services. By dispensing with the need to conduct physical face-to-face verifications, this is expected to significantly expand access to remittance services for customers working and living in remote parts of Malaysia, while effectively addressing money laundering and terrorist financing risks. Bank Negara Malaysia also successfully collaborated with the World Bank and the money services business industry in Malaysia to pilot and adopt solutions that have expanded the reach and reduced the costs of formal remittances. Second, policy life cycles will need to be managed more proactively, to allow for policies to be renewed when conditions change. While much is often said about policy stability, policies that fail to keep pace with conditions that are changing far more rapidly than we have experienced before, can be counterproductive at best, and at worst, create greater risks for the system. The SDGs are undeniably one of the most comprehensive attempts to capture the most important global challenges that we face. Solutions to these challenges will invariably create new issues for policy makers to consider. This in turn will lead to shorter policy life cycles, and a need for faster policy responses to emerging issues. Third, we need better remittance data. It is encouraging that efforts are being taken to ensure the availability of official global data sources on remittance flows.

Another area in which there is significant participation of women is the services sector which has now become one of the most important sources of growth for the Malaysian economy projected to expand by 7.7% in 2008. Ninety percent of womenowned SMEs in Malaysia are in fact in the services sector. Some of these activities are also developing in the informal sector. As, the formal economy in Malaysia continues to prosper, there is significant scope to integrate the informal sectors of our economy with the formal sector. Deliberate actions to integrate the informal economy into the formal economy will give this segment of society increased opportunities. As part of the efforts to promote greater engagement of women in the modern economy and their increased participation in the formal economy, significant initiatives have been taken to raise the level of financial literacy among  2  BIS Review 37/2008  women. Greater empowerment can be achieved through the resulting greater financial independence. In many countries, the success of various national and international socio-economic reform programs have resulted in women becoming an increasing part of the formal economy. Through the concerted efforts of women's rights movements, economic policy intervention and gradual shifts in cultural norms, women today have more opportunities for education, careers and political representation. This has allowed for increased participation in the economy. Bringing women into the economic mainstream would contribute to the economic potential of the nation.
Along with the evolving pattern of cross-border flows, we’ve also seen profound increases in the absolute size of current account balances in both industrial economies and emerging market economies. The average absolute value of current account balances as a share of GDP is higher today than it was three decades ago, with much of the run-up occurring in the past decade, and there is less dispersion around the average. Net external positions as a share of GDP have increased over time for both industrial and emerging market economies. A more integrated world economy brings with it the prospect of a more productive and competitive world economy. The increase in the ties between national financial systems, the greater sophistication of financial markets and financial market instruments allow risks to be shared more broadly and capital to flow to where the returns are expected to be the highest. Over time, these forces can be expected to strengthen and stabilize economic growth. Indeed, the recent spurt of integration has occurred during a sustained period of relatively strong global growth, relatively stable and low inflation, and, although less widespread, a reduction in the volatility of growth. These improvements in outcomes have surfaced amidst a number of other important changes in the environment as well, including significant technological progress and better economic policies. But even without being able to assign precise shares to all the contributing factors, we know that greater integration and openness is likely to have been particularly important.

It is true that fewer countries now operate with the fixed but adjustable exchange rate pegs - the middle ground that characterized much of the emerging world up to the crises of the late 1990s. But many still make monetary policy subject to the overriding objective of limiting the variability in the exchange rate against their major trading partners. 2  BIS Review 102/2006  Viewed through this lens, it becomes apparent that the dramatic rise in the level of official reserves in much of the emerging world is not simply the consequence of a desire for a greater financial cushion against external vulnerability. It also results from the lingering aversion to letting exchange rates adjust upwards in response to market forces. As capital markets become more open, this middle ground is harder to sustain. The broadening recognition of this is leading to a gradual increase in exchange rate flexibility, and this process is likely to continue. The pace of progress, progress in the direction of more openness to capital flows and greater exchange rate flexibility, will depend in part on the pace at which these governments are able to strengthen the resilience of the domestic financial system and set in place the broader institutional framework and supervisory regime that are vital for an open economy. For those countries that are less far along in this transition, policy still reveals a substantial degree of ambivalence about the benefits of integration; and doubts about their ability to limit the risks in greater exposure to volatility.
The starting point here will be to try to understand the nature of these vulnerabilities better, and their potential impact on the financial system. BIS Review 29/2003  1  Vulnerabilities: comparing banking and insurance My first observation relates to the different “customs and practice” of the two industries. In the banking world, obligations have historically tended to be for amounts which are clearly specified - either in money terms or according to some agreed formula - in advance. The event triggering delivery of the obligation is unambiguous. Often it’s simply expiry of a set time period; and the timetable for payment once the obligation becomes due is fixed (and typically short). In the non-life part of the insurance world, on the other hand the amount to be paid is often a matter of interpretation of the contract. There might be greater scope for debate about whether the triggering event has actually occurred or whether any associated conditions have been met - even whether payment is due. And any payment due may not be made, at least in full until negotiations on these points have been completed. The fact that well-established channels may exist to resolve any disputes - including if necessary the courts - doesn’t get around the fact that uncertainty regarding the timing and quantum of payment is injected into the process. Bankers find it hard to reconcile these realities of the insurance world with the way they manage risk and undertake their business.

The transferors may have proper insight into the nature of the risks. But to whom have the risks been transferred? Are the transferees actually aware of the risks they have taken on? And are they in the best position to monitor these risks as they evolve? How do they acquire day to day knowledge about the quality of those risks? Going further, what might they do when they find out? 2  BIS Review 29/2003  Some of the concerns being expressed by private and public sector commentators in these areas are, in my view, important and worthy of further examination. Those concerns I’m talking about include: a lack of aggregate data on derivative positions; lack of transparency in accounting for them; and the potential for unexpected concentrations of risk to build up. Although in principle this redistribution of risk should be benign we simply do not have the information at present to judge what the actual impact has been. But why is all this relevant to insurance? It’s certainly true that in a lot of cases originating banks have laid risks off to other banks. There are many possible reasons for this: for diversification or to avoid concentration; opportunities to earn fees; regulatory arbitrage; and different views on pricing and spreads. But it is also well known too that risks have been transferred from banks to various areas of the insurance world. That includes reinsurance, where the degree to which such risk has now been concentrated is difficult to assess.
Even in the predominantly agricultural areas, the trend has been the same. Consequently, it has become a nearly impossible task to keep the rural youth occupied in agricultural activities. This has made it necessary for opening new employment avenues for such youth. An additional factor has been the natural limitation for growth of agriculture due both to the slow growth in demand for agricultural products and the supply constraints of land for further extensive cultivation practices. Hence, in the beginning, agriculture may be the growth promoter, but later, its growth would slow down due to the above limitations. The global experience has been that the average rate of growth in agriculture has been less than 2 percent per annum during the last 100 years. With higher and higher numbers being added to the job market every year, agriculture has, therefore, a limitation for providing jobs for all. Sri Lanka’s agriculture sector has made its utmost contribution to create wealth and employment in the past. Its current ability to do so has been a matter for debate. With employment in agriculture being seasonal and the concentration of a large farm-based work-force on a limited extent of cultivable land, underemployment has been the natural corollary in Sri Lanka. The new evidence shows that the under-employment in agriculture in Sri Lanka is not only the highest but also on the increase.

It is crucial to take immediate measures to tackle the inflation that we see on the horizon. This is the Central Bank’s mandatory role and the Bank is determined to perform it. The more that other economic agents contribute towards containing expansionary trends, namely the central government, local government and credit institutions, the easier it will be to ensure long-term stability. The successful economic policies of past years must not be swept aside in favour of short-term solutions that would ultimately only backfire. BIS Review 22/2005  5