samchain/econo-pairs-v1 huggingface dataset:
If this time’s technological transition is as great as any previously, securing sustainable growth will need new institutions to manage this transition and mitigate its societal side-effects. I have speculated on one area where that next institutional wave might usefully break – universities like this one, as new centres of lifelong learning and technological diffusion. In future, institutional innovation will be every bit as important as technological innovation if that gift of growth is to keep on giving. 22  All speeches are available online at www.bankofengland.co.uk/speeches  22  References  Acemoglu, D and Restrepo, P (2017), ‘Robots and Jobs: Evidence from US Labor Markets’, NBER Working Paper, No. 23285. Acemoglu, D and Restrepo, P (2018), ‘Artificial Intelligence, Automation and Work’, NBER Working Paper, No. 24196. Acemoglu, D and Robinson, J (2012), Why Nations Fail: The Origins of Power, Prosperity and Poverty, Penguin Random House. Allen, R (2005), ‘Capital Accumulation, Technological Change, and the Distribution of Income during the British Industrial Revolution’, University of Oxford Economic Series Working Papers, No. 239. Allen, R (2009), ‘Engels’ pause: Technical change, capital accumulation, and inequality in the British industrial revolution’, Explorations in Economic History, Vol. 46, No. 4, pp. 418-435. Andrews, D, Criscuolo, C and Gal, P (2016), ‘The Global Productivity Slowdown, Technology Divergence and Public Policy: A Firm Level Perspective, Hutchins Center Working Papers. Anson, M, Bholat, D, King, M and Thomas, M (2017), ‘The Bank of England as lender of last resort: new historical evidence from daily transactional data’, Bank of England Staff Working Paper, No.

An important element in improving financial stability is to reduce the expected loss associated with the failure of any financial firm to the point where default does not imperil the financial system and the real economy. A holistic approach is needed that both provides a credible resolution process for large, complex and interconnected banks, uses enhanced prudential standards and initiatives to further reduce the probability of default and the social losses associated with a default, and that incents management to intervene early to address incipient problems before they threaten the viability of the firm. Relying solely on resolution is not sufficient. Until the Title II resolution process is used, there will remain uncertainties regarding how well this approach will work in practice – especially in a time of market stress. For this reason it is also important to continue to pursue a number of alternative approaches. Thank you for your kind attention. I would be happy to answer a few questions. BIS central bankers’ speeches  7
It was then that inflation expectations among the public finally trended down to the target of 2 per cent, and that interest rate spreads against Germany were reduced to fractions of a percentage point. This fiscal tightening could in turn be based on the predictability of the new monetary regime that would eventually allow less severe monetary policies. This interaction is rather well understood, if not always acted upon, at the national level. But on the European level there is a twist, as the single monetary policy is now matched by a multitude of fiscal policies. The risk that is often discussed is that the ECB would in the end have to bail out a single fiscally undisciplined country from unsustainable debt. But as the Stability Pact crisis has shown, the more immediate problem might be more prosaic than a cataclysmic debt crisis: the problem might be a bias towards fiscal laxity that has to be counterbalanced by tighter monetary policy - hence a bad policy mix. With a single monetary policy the effect of fiscal stimulus in one country will be diluted in the whole area and will therefore by definition meet with less of a monetary policy response than it would if monetary policy had been national. Furthermore the nature of the political set-up makes it more difficult for the ECB to comment on individual national budgets. This means there will be a strong temptation to “free ride” by expanding the budget at the expense of fellow European nations.

The political debate is in a sense being taught to keep the long term in view. The public then knows from the national debate that fiscal discipline is good for the country and if “accountants” or other nations in Brussels criticise your budget policies, there is a greater chance of the criticism being interpreted as a help towards fiscal soundness. The Swedish trade unions, for example, are among the most vocal defenders of our budget target. However, the framework might still not be strong enough - the 2 per cent over-the-cycle target has been slipping somewhat out of view given that the government, as I mentioned, is focusing more on the short term recently. Sweden would perhaps need an even more formal external fiscal evaluation. This leads to an important conclusion for the Pact. Perhaps the solution to regain credibility is neither to water down the Pact, nor to impose even stricter rules centrally. The solution is perhaps to build from below - to complement the European level with national frameworks in the respective European nations so that they come to internalise the need to balance their budget over the cycle and to ensure that the same transparency exists on the fiscal side as on the monetary side. While pressure from fellow finance ministers has apparently not worked well enough, the present attempts at national processes with transparent targets have a better track record.
The UK government’s plans for insulating retail banking are, therefore, a central element of the plans to make the UK’s large and complex banks resolvable. The proposals in the recent Liikanen Report on the structure of EU banks are welcome in seeking to achieve the same goal. Both Vickers and Liikanen can be viewed as working with the grain of the broader international agenda on resolution regimes. But bail-in can be attractive when a distressed group does have viable parts and sufficient uninsured debts covered by the bail-in power. As the UK’s resolution authority, the Bank is working closely with the FDIC on how to operationalise this type of resolution strategy. Meanwhile, the FSB will, over the next month or so, be publishing a consultative paper on resolution-strategy planning. The prospect of taking losses via resolution gives debt holders a strong incentive to monitor banks’ risk taking. That will be a first order change for the financial system. Expose management to tail risk: payment in subordinated debt Once debt holders are unambiguously exposed to loss, the authorities need to consider whether to require management to be paid to a significant extent in subordinated debt: an idea recently endorsed by the Liikanen Committee. 6 Having managers exposed to instruments whose value depends on the survival of their firm would give them a healthy incentive to maintain a safe and sound bank. There should also be a review of the structure of remuneration for desk-level bankers – tying pay to the medium-term success of the firm.

Another example of changing the way we operate was our decision in 2014 to grant broker dealers access to reserve accounts at the Bank of England for the first time. Second, empowered by strengthened regulatory frameworks and resolution regimes, we have reaffirmed our commitment to abide by Bagehot’s 19th century advice that the best way to avoid a panic is to “lend freely and vigorously...on all good banking securities.” For example, shortly after the result of the UK’s referendum on EU membership was declared we made clear that banks already had collateral positioned with us such that they could borrow more than £ and announced that our regular liquidity auctions would continue to run on a weekly basis throughout the summer. Coupled with banks’ own strong internal liquidity positions, this has helped ensure the smooth functioning of money markets. And overnight market rates have stayed close to Bank Rate throughout the period since the referendum. Third, we have taken steps to ensure that the vital infrastructure of money markets continues to remain effective. The work on risk-free benchmark rates being undertaken by both the Federal Reserve and the Bank of England is a good example of this. Building on recommendations made by the FSB 3 – which drew on the findings of a market practitioners group chaired by Darell – both central banks have convened working groups of market participants with the aim of identifying benchmarks of nearly risk-free reference rates that could that could sit alongside Libor.
More should also be done to promote the participation of domestic long-term investors such as insurance companies and pension fund into the region. Through these measures the intention to recycle Asian savings and surplus funds for the productive use of the region would be realised. Malaysia has taken several steps to develop its market to facilitate cross border investment activities. Over the years, we have liberalized foreign exchange administration rules to make it easier for domestic investors to invest abroad and for foreign investors to invest in Ringgit assets. With this progressive liberalization, ASEAN investors can now buy Ringgit assets from the region or any part of the world. Together with the Malaysian Securities Commission, we have introduced a transparent and facilitative framework for the issuance and subscription of ringgit and foreign-currency denominated Sukuk and bonds in Malaysia. Our efforts have resulted in a growing trend of regional issuers participating in our domestic market. A leading Indonesian oil palm plantation company was the most recent issuer in Malaysian domestic bond market, issuing MYR500 million Islamic securities, its second securities issuances. Other Asian issuers that have tapped the Malaysian domestic bond market include two other Indonesia’s palm oil plantation companies, a Hong Kong based global supply chain company, Korean banks and corporations. As at September 2014, the total issuances by non-residents, including ASEAN issuers, amounted to 58 issuances. This accounts to a total of MYR20.5 billion (USD6.5 billion equivalent). We are a firm believer in cooperation between financial markets.

Muhammad bin Ibrahim: ASEAN’s rapid economic growth and future potential Opening address by Mr Muhammad bin Ibrahim, Deputy Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the ASEAN Fixed Income Summit (AFIS), Kuala Lumpur, 29 September 2014. *  *  *  I am pleased to be here at the inaugural ASEAN Fixed Income Summit, which is hosted by Bank Negara Malaysia, together with Cagamas, the ACI – Financial Markets Association of Malaysia and Malaysian Association of Corporate Treasurers. We have here today, an impressive gathering of senior policy makers across ASEAN and senior representatives from major financial institutions and corporations operating in the region. I would like to welcome all of you to Sasana Kijang, Kuala Lumpur and to Malaysia. Today, we are in one of the most dynamic and fastest-growing regions in the world. Based on IMF’s forecast, world growth in 2014 and 2015 would be 3.4% and 4% respectively. The ASEAN region is expected to grow by 6.4% in 2014 and 2015. ASEAN’s GDP is expected to reach USD3 trillion by 2017, tripling in size relative to a decade ago. With a diverse range of economies in terms of size, stages of development and economic structure, including home to many dynamic and emerging economies such as Myanmar and Vietnam, economic expansion in this region are expected to be sustained, and significantly outpace global growth. As ASEAN continues to open up to global investors, foreign direct investment flows (FDI) is expected to accelerate.
Alternatively, it can be said that an additional axis and thus an additional dimension are required that correspond to the sum of squared changes in the interest rate, so that the modified Taylor curve becomes a three-dimensional, bowl-shaped Taylor surface. Taylor curve for analysis ex ante applies instead to the sum of squares of the inflation-gap and output-gap forecasts ex ante. BIS Review 29/2009  7  A major difficulty in this analysis is that it may be unclear what is meant by stabilising the real economy. From a monetary policy perspective it is the stabilisation of resource utilisation rather than GDP growth that is relevant. This means stabilising resource utilisation around a normal level. The problem is that resource utilisation can be measured in several ways. A reasonable and commonly used measure of resource utilisation is the so-called output gap; that is the difference between actual production and potential production. However, potential production is not a magnitude that can be observed directly – it must be estimated. There is considerable uncertainty, both theoretically and empirically, about the best way to estimate and forecast potential production. The output gap shown in the figures is the so-called HP gap, which has significant weaknesses. 7 It is important and desirable from several points of view that the Riksbank and other central banks develop better and clearer measures of resource utilisation and potential production and that they publish their measurements and forecasts. Such work is underway at the Riksbank.

As a result, we continue to expect real GDP to grow at a moderate but steady pace and euro area inflation to rise gradually over the coming months, in line with the path already implied in our June 2016 staff projections. The Governing Council will continue to monitor economic and financial market developments very closely. We will preserve the very substantial amount of monetary support that is embedded in our staff projections and that is necessary to secure a return of inflation to levels below, but close to, 2% over the medium term. If warranted, we will act by using all the instruments available within our mandate. Meanwhile, the Governing Council tasked the relevant committees to evaluate the options that ensure a smooth implementation of our purchase programme. Let me now explain our assessment in greater detail, starting with the economic analysis. Euro area real GDP increased by 0.3%, quarter on quarter, in the second quarter of 2016, after 0.5% in the first quarter. Incoming data point to ongoing growth in the third quarter of 2016, at around the same rate as in the second quarter. Looking ahead, we continue to expect the economic recovery to proceed at a moderate but steady pace. Domestic demand remains supported by the pass-through of our monetary policy measures to the real economy. Favourable financing conditions and improvements in the demand outlook and in corporate profitability continue to promote a recovery in investment.
All gains arising from disposals of shares and real properties which have been held for more than 10 years will be treated as non-taxable capital gains. For assets held for less than 10 years, IRAS would look at the facts of individual cases to decide whether capital or income treatment is appropriate. The Government will also waive stamp duty on sales of all shares and properties where the gains are considered capital in nature. These concessions will not apply to gains arising from the disposal of shares which have previously been claimed as trading stock for tax purposes, or gains on disposals of real properties by banks’ property development companies. However, where income tax is payable arising from a mandated sale of assets that does not qualify for capital gains tax exemption, the Government will give the banks three years to settle the amount. This package will apply only to assets required to be disposed of under the restructuring exercise, and will only cover disposals made within the three-year period allowed by MAS for the restructuring. Conclusion MAS has discussed our plans with the local banks. They agree with the policy direction proposed. They have suggested some modifications to the MAS proposals, which wherever possible MAS has incorporated. Our approach is pragmatic, not purist. Our circumstances are different from other countries. We need to strike the right balance, to find the framework that suits our economy, and which recognises the historical developments that have brought about the present situation.

Therefore, in the present exercise MAS will allow the principal shareholders to continue owning indirect stakes in the banking groups through the non-financial entities that they control. MAS will review this arrangement later. Management To avoid conflicts of interest, the management of the financial entities should be separate from the management of its non-financial affiliates. There should be no sharing of executive directors and management staff, such as the chief financial officer and chief operating officer. On the board of directors of a regulated financial entity, a majority of the directors should not be holding directorships on the boards of the non-financial affiliates as well. Name-sharing Mixed conglomerates usually leverage on common brand building. Many of the non-financial affiliates of local banks share the name of their parent banks. Financial and non-financial entities alike have built up goodwill in the brand name over the years. But reputational and contagion risks can result from sharing of names and corporate badges between the bank and its non-bank affiliates. Where an unregulated entity sharing a name fails or falls into disrepute, the public may attribute its problems to the bank, causing a bank run. MAS will therefore disallow the sharing of names and logos between the financial and non-financial entities. We are considering amending the Banking Act, to prevent the use of names or acronyms by companies that may confuse the public, or give the impression that a company is related to or associated with any Singapore-incorporated bank.
According to Banque de France calculations, the nominal CoE is still more than 9% for large listed companies in the euro area – compared with a risk-  4 free rate of around 0%. In other words, the risk premia have increased. The high CoE prompts companies to give priority to dividends and share buybacks over investment. In addition, it often goes hand in hand with a persistently high “hurdle rate”vii within companies, which results in an excessively severe selection of investment projects. The United States are a case in point (slide 9): since the early 2010s, share buybacks and dividends have increased sharply to more than 100% of reported earnings, while productive investment has significantly slowed down to an almost zero growth. 3. So what can be done to cure the investment dearth? First and foremost, we need a comprehensive therapy in Europe, both economic and financial. On the economic side, monetary policy is active and efficient; but it cannot remain the only game in town. Growth will be stronger in Europe if we combine structural reforms – including pro-business measures – where they are needed, such as in France, with greater fiscal support to help spur investment in the countries that have room to manoeuvre, such as Germany. But we also need to address the financial side of this investment dearth issue. The United States shows how crucial it can be in the long term.

The IMF estimates that it stands 10% to 15% below pre-crisis forecasts in the euro area.ii However, to fully understand the situation, we need to take a closer look at the nature of business investment. We must distinguish between investment in construction on the one hand – which in itself does not spur innovation – and investment in research and development and industrial machinery on the other, which I call “productive investment”.iii The matter of concern is that productive investment is insufficient: across the economy as a whole, the productive investment rate has long been lower than before 2007 in the euro area and is persistently weaker in France than in Germany. This brings us to the third important feature of this investment dearth: the behaviour of businesses (slide 6). Since mid-2009 it has dramatically changed: given the  weakness  of  business  investment,  non-financial  corporations have turned from net borrowers into net lenders. Thereby they  3 have fuelled the current account surplus in the euro area. In short, all of these realities converge: the root of the problem today in Europe is the investment deficit more than the savings glut. 2. Now, why has this investment dearth happened? Let me briefly elaborate on the key levers of investment. The first and most important one is expected demand (slide 7). The overall weakness in economic activity acts as a deterrent for most businesses.
BIS central bankers’ speeches  All of the Desk’s eligible counterparty types participate in the ON RRPs, with money funds accounting for the largest share of take-up (Figure 6). Take-up at the operations generally increases when the spread between market rates and the ON RRP offered rate narrows. Take-up also rises substantially around quarter- and year-end financial reporting dates, when some money market participants’ access to other overnight secured investments is more limited. The increase in take-up on these dates is especially large for prime money market funds (Figure 7). In addition to patterns of usage of the ON RRPs themselves, we also analyze trading patterns and interest rate dynamics in secured and unsecured funding markets. In doing so, we use a wide range of data, including transactions data for unsecured funding markets obtained through a new Federal Reserve collection effort (FR 2420). While ON RRPs are a powerful tool for policy implementation, FOMC and market participants have noted the potential for very large regular usage to alter patterns of financial intermediation or, in a fixed-rate structure with no take-up limits, to exacerbate liquidity pressures during times of stress. To further examine how ON RRPs might best be structured to supplement IOER in the control of the federal funds rate while limiting the potential for unintended effects in financial markets, the FOMC has directed the Desk to test several changes to the design of its ON RRP operations.

Any financial system - and the Swiss system is no exception - can be misused in order to transfer or recycle money issued from, or linked to illegal activities, including terrorism, drug trafficking, illicit trades in weapons, modern slavery, and corruption, just to name a few. To be sure, a money laundering risk already existed in the past. As a result of globalisation, however, and of the growing significance of organised crime, the risk has increased considerably in recent years, not just in my country, but in every major financial centre. For this reason, a dense network of legal regulations, controls and self-regulatory mechanisms is necessary in order to make a financial centre as unattractive as possible for criminal funds. Switzerland has been one of the first countries to introduce strict anti-money laundering laws. They cover the activities not only of banks, but also of any other financial intermediary such as insurance companies, funds managers, lawyers and even fiduciaries. Our experience so far has shown that an efficient fight against financial crime requires two specific rules: first, the application of strict due diligence procedures that includes careful identification of the customers, i.e. of the beneficial owners of the assets involved; second, the obligation, imposed to the market intermediaries to inform the authorities in case of any founded suspicion of money laundering. I am fully convinced that an effective fight against money laundering can only be successful if an active co-operation between financial institutions and authorities is promoted.