samchain/econo-pairs-v1 huggingface dataset:
Vice Chancellor, we are aware that the supplementary funds provided by BOZ cannot meet all your requisite needs with regard to enhancing your research capacity. I therefore urge you to forge other linkages that promote research. I have in mind the African Economic Research Consortium (AERC) whose principle objective is to strengthen local capacity for conducting  BIS Review 140/2007  1  independent, rigorous inquiry into problems pertinent to the management of economies in Sub-Saharan Africa. AERC was established in 1988 as a public not-for-profit organization devoted to advanced policy research and training in economics. However, it is rare to find Zambians utilizing the facilities which are offered by this organization. Our hope is that with this information, we will see more papers by UNZA academicians on the AERC website in the near future. In order to encourage research on local issues by our own researchers, I am contributing an book to the UNZA library by Professor Paul Collier, the Director for the Study of African Economies at Oxford University. The book, “The Bottom Billion” provides an example of the sort of issues which we expect our own authors to be able to elucidate on more clearly from their own experiences. In the book, Collier analyses the causes of failure by fifty failed states, pointing to a set of traps that snare these countries. These traps include civil war, a dependence on extraction and export of natural resources, being land-locked, and bad governance.

If in adopting model charters, some of you find certain provisions too onerous, it may be necessary to consider a phased approach to their adoption. In this way, the process of adopting model charters will not place on an  2  BIS central bankers’ speeches  organisation undue difficulties. The model charters, it is hoped will act as guide for institutions to adopt elements that are applicable to their sub sector and industry and act as a benchmark, for you, and for assessing board and management and for assisting the oversight function by regulatory supervisors., such as ourselves. I expect that individual institutions requiring further advice will continue to engage us, as well as the consultants, to ensure that they extract maximum benefit from the work that has gone into this phase of the FSDP. I thank you all and wish you fruitful deliberations. BIS central bankers’ speeches  3
Since the number of homes cannot adjust quickly, rising demand during a boom typically leads to rapid rises in prices and unregulated rents. Eventually, of course, the amount of housing supplied responds to changes in demand. So, how did the economic expansion and contraction affect New York City’s housing market? For a mature city, the city saw an unusually strong boom in housing sales, construction and prices. This expansion actually began in 1996 and continued even in the aftermath of the 9/11 attack. Since 2007, however, New York City’s market has turned down. This decline started later than the nation’s and prices have fallen less sharply. Now, prices appear to have stabilized. This pattern can also be seen in Manhattan’s rental market. After a long period of rising rents, the market weakened substantially from 2007 to 2009, and rents have rebounded moderately in 2010. New York City has not been spared from the high rates of mortgage delinquencies characteristic of this recession. Manhattan’s delinquency rates are elevated although they remain markedly below the national average. By contrast, pockets of distress are much more prevalent in the outer boroughs, all of which have delinquency rates, per owner-occupied unit, above the national average. The relatively mild recession and the recovery in the City are lending support to both home prices and sales. Also positive, compared with the rest of the country, are the City’s low mortgage leverage rates and a low share of homes with underwater mortgages.

This stock of vacant homes will shrink when fewer are foreclosed upon and more of these homes are sold or rented out. 2  BIS Review 137/2010  On the sales side, even though low mortgage interest rates and falling home prices have together boosted housing affordability to its highest level in 40 years, the current pace of sales is quite sluggish. Impediments to home sales include tight lending standards, a weak job market and continued uncertainty regarding the future path of home prices. The large decline in home prices that occurred between 2006 and 2008 is also important. This decline reduced the amount of equity that owners have in their homes, making it difficult for people to come up with the funds needed to “trade-up” and move into better homes. In addition, the steep decline in home prices put many families at risk of mortgage delinquency and, ultimately, losing their homes to foreclosure. With lower home prices, many families now owe more on their mortgage than their home is worth. This means that they cannot refinance or sell their homes easily if they experience a financial crisis, such as a job loss or a serious illness. Recent developments on foreclosures have been mixed. While RealtyTrac reports that foreclosure completions in the United States exceeded 100,000 for the first time in September, it is important to remember that foreclosure is a lengthy process in most states.
At the risk of oversimplifying, Central Banks associated with – or responsible for – financial stability may find themselves with:   two separate missions: price and financial stability    two different accountability regimes: full independence for monetary policy; coordination or subordination mode for financial stability    two interacting sets of instruments: interest rates and macro prudential tools (a situation made even more complicated when unconventional monetary policies are implemented)  The potential for confusion is real. It is not difficult to imagine situations where actions that Central Banks take on pure monetary policy grounds are nevertheless contested in the name of financial stability. To some extent, this has always been a possibility. The difference, now, is that institutional frameworks exist through which – implicit or explicit – challenges to Central Banks operational independence can materialize. It might be tempting to conclude, then, that Central Banks should stay away from financial stability and concentrate exclusively on ensuring price stability. This, unfortunately, is impossible, if only for reasons that Charles Goodhart has well explained in a previous paper: ultimately, Central Banking is about providing liquidity and liquidity provision is an essential and central component of financial stability. What can we conclude?   First, central banking is not only about monetary policy but also involves an essential component of financial stability. This seems to me a broad consensus coming out of the crisis.

It is obvious that there will be need to rebalance fiscal and monetary policies in these economies once growth becomes more broad-based and entrenched to avoid a build up of inflationary pressures. As the crisis was mainly a result of weak regulatory framework and poor supervisory oversight in advanced economies, there is also need to continue undertaking measures to reform the financial systems and enhance global standards for the supervision of the financial sector. Zambia weathered the crisis relatively well, with growth in 2009 actually increasing to 6.3% from 5.7% in 2008. This growth was largely driven by increased output in the mining and quarrying, construction, agriculture, and energy sectors. Although the Zambia’s financial sector was not directly exposed to toxic assets, the financial crisis and the global recession that it triggered did impact Zambia’s macroeconomic environment. The Zambian economy suffered reversal of short term capital flows and a slowing down of foreign direct investment, which had an adverse impact on the exchange rate of the Kwacha against the major currencies. The collapse in commodity prices as global demand contracted also impacted on Zambia’s mining sector and its related support industries, leading to losses in output and employment that fed back into the deterioration in the loan book of commercial banks. Nonperforming loans in the banking sector, for example, rose from around 6% in June 2008 to 12.6% at the end of 2009.
Certainly, it seems to me that the accompanying low levels of inflation, together with relatively high rates of resource utilization, suggest that something more than normal cyclical forces is at work. The ability to develop and deploy these technological advances rests on underlying changes in our labor and financial markets, changes that have been occurring over the last two decades. With respect to labor markets, two main changes have occurred. First, large corporations have been increasingly willing to lay off workers and restructure their businesses during the expansion phase of the business cycle rather than waiting for a recession to do so. This process has been under way in the United States for over a decade and it has not been accomplished without pain. A crucial unanswered question in the current environment is how to identify the point at which labor market tightness becomes sufficiently severe for workers to demand more permanent pay increases. Second, there appears to be a shift in the structure of compensation toward variable pay that includes, but is not confined to, stock options. This shift away from wages and traditional benefits has allowed for greater flexibility in labor costs and by this means has made it easier for new firms to add labor. Employees compensated through incentive pay take on some of the risks of capital.

Trends which have been ongoing in the past decade, such as rising inequality in AngloSaxon countries and the current financial crisis, could determine, however, a shift in the preferences of the US population in favour of greater State intervention in sectors such as education and health care. This is, at least, what seems to come out from the election of the new US president. The reduced importance of the public sector as an automatic stabiliser could increase US business cycle variability and create the scope for more discretionary fiscal stabilisation measures. The preference for discretionary interventions is enhanced by the low tolerance in the US for protracted slowdowns of economic growth. This may hinge, inter alia, on the impact that economic slowdowns may have on social cohesion in an environment with fewer automatic stabilisers. Another reason may have to do with the frequency of the electoral contests, not only in the executive but also and especially in the legislative branch, where elections take place every 2 years. It is well known, in fact, that the economic situation has a crucial importance for voters. Ricardian equivalence is one widely debated aspect of the discretionary component of budget policy. It is worth pointing out that a financial agent adopting a Ricardian approach is capable of looking ahead and of understanding that higher government spending today will entail higher taxes tomorrow. Thus a Ricardian consumer does not easily alter his spending in response to fiscal injections.
On the other hand, emerging and developing Asia are expected to grow more than three times as quickly as advanced economies14. 17 In order for Asia to fully reap the fruits of these favourable macro trends, it will need to raise the needed long-term capital for sustainable growth, including by further strengthening its bond markets. Today, I will touch on three areas: first, a new Asian Bond Grant to support a broader base of Asian issuers; second, efforts to encourage rated issuances; and lastly, supporting secondary market liquidity. Let me start first with the Asian Bond Grant initiative. Measures to strengthen Asia’s bond markets Introducing the Asian Bond Grant 18 In many ways, Singapore has always been a bridge between Asia and the rest of the world, whether as an entry point for global investors looking into Asia or as a launchpad for Asian companies seeking to regionalise and globalise. We have had some success in developing the Asian G3 bond market, but Asian local currency issuances have room to grow. When I spoke here two years ago on integrating Asia’s capital markets, it was against the context that the markets were fragmented on several dimensions: laws, currencies, market practices as well as market infrastructure. Investors need to understand each market and each set of laws before investing. Likewise, Asian companies seeking to raise international capital, on top of domestic capital, may need to obtain international ratings and international documentation, and these require international lawyers and accountants, and international roadshows.

In an environment of increased uncertainty about  BIS Review 27/2001  1  the global economy and its impact on the euro area, the Governing Council is carefully assessing whether and to what extent upward risks to price stability will continue to decline. As far as the first pillar of our monetary policy strategy is concerned, the decrease of money growth indicates that upward risks to price stability have receded. As for the second pillar, domestic upward price pressures may decrease as a result of somewhat lower than expected GDP growth in the euro area. However, due to the risk of secound-round effects from past oil price increases, wage developments will be monitored carefully, as these might result in upward price pressures. In the financial sphere, the advances in information and telecommunication technologies have started to have their effects. This was perhaps even more visible than in the non-financial sphere. In the banking sector, a development that has attracted considerable attention over recent years is the emergence of internet banking. The first financial products and services to be distributed over the Internet were rather standardised ones, in fields such as securities brokerage and payment services. More recently, a wider array of financial products and services have become available over the internet, which has thus become an important distribution channel for a number of banks. Many banks in the euro area have already developed the internet channel to various degrees.
The ASEAN+3 member countries have already taken steps to multilateralise the Chiang Mai Initiative towards a more advanced and robust framework for the effective pooling and utilisation of liquidity support in the region. The bilateral relationship between Malaysia and Korea Malaysia’s economic relationship with Korea is very much part of this integration process in Asia. The bilateral trade and investment relationships between Korea and Malaysia over the recent years has continued to increase with trade now averaging RM45 billion per annum. Both countries have already benefited from the growing production networks within the region as well as from the numerous trade and investment opportunities from an increasingly open and liberal business environment. Investment linkages, though still relatively modest, have been on an upward trend since 2006. Korean investment in Malaysia is predominantly in the manufacturing sector, particularly the electrical and electronics sub-sector. The opportunity for further co-operation in this area is vast. Korea, as a nation known for its knowledge-based and innovative capabilities, can leverage on the liberal investment climate offered by Malaysia to diversify into new growth areas such as green technology and biotechnology. In the area of finance, Malaysia now has a well-developed financial system, with deep capital markets including a comprehensive system of Islamic finance. The Malaysian bond market is the fourth largest in Asia in terms of volume after Japan, China and Korea. More than 55% of the outstanding bonds are Shariah-compliant and the sukuk market is the largest in the world.

If more people take part in the labour force, wages and thereby inflation should be held back. Developments in the wage bargaining rounds so far do not indicate that the potential labour supply is holding back wage demands quite as much as we had earlier estimated. Abolition of property tax on housing One of the Government’s proposals that has received considerable attention is the proposal to abolish property tax on housing. A working group has been commissioned by the Government to investigate a model that would finance this tax cut in the housing sector. In this model, the tax is replaced by a municipal charge and higher tax on profits made when selling property. In theory, a fully-financed proposal should not involve any effects on general housing price levels. However, in practice there is reason to believe that house prices will increase at a slightly faster rate due to the tax changes. In those parts of the country with high property taxes, and where the difference between the municipal tax and the current property tax is substantial, there could be fairly large price increases. But this would probably be mainly a one-off effect that did not have any more long-term effect on the rate of price increase. Therefore, a fully-financed abolition of the property tax would not necessarily have any major direct impact on CPI inflation.
There is substantial scope in the region for brokers to better understand the risk profiles of SMEs – specifically how they are affected by loss events and what it would take for them to recover – and to work with insurance providers to lower the costs of insurance through innovative solutions and better data. A key focus of Bank Negara Malaysia in the coming years will be to provide an enabling environment for insurance brokers in Malaysia to develop the technical, financial and operational capacity that will enable them to effectively support businesses in both mainstream and niche areas under the new economic landscape. In this connection, the Bank will be introducing new measures to foster greater competition, and expand opportunities for brokers to forge strategic partnerships for long term growth. This will include specific measures with respect to foreign participation in the insurance and takaful broking industry in line with the recommendation of the Bank’s Financial Sector Blueprint 2011 – 2020. The Bank expects to make further announcements on this in due course. BIS central bankers’ speeches  3  The evolution of insurance broking also raises important questions for managing conflicts of interest. Insurance brokers are often well placed to offer a broad range of services that may go beyond advising on and securing insurance solutions. These include an expanded role in risk consulting and management, the administration of employee benefit schemes, and claims handling services provided for a fee.

No matter what supervisory approach you take in respect of IRB validation, it is only one of the major questions to which we need to find an answer. Banks and their supervisors in Asia are going to face a variety of challenges ahead in the implementation of the Basel II IRB framework. Through today’s outreach event, I hope that there will be stimulating discussions on these issues and that participants will be able to take away ideas that can help them make the implementation of the IRB framework in their jurisdictions a success. I also hope that the AIGV, the AIG and the Basel Committee can take account of the views of the Asian region, and of the particular issues we face. Thank you. BIS Review 120/2007  3
This again suggests that there is a role for supervision and regulation in the bubble prevention process. For example, it might be appropriate for the Federal Reserve – working with functional regulators such as the SEC (Securities Exchange Commission) – to monitor and limit the buildup in leverage at the major securities firms and the leverage extended from these firms to their clients and counterparties. Whether there is a role for monetary policy to limit asset bubbles is a more difficult question. On the one hand, monetary policy is a blunt tool for use in preventing bubbles because monetary policy actions also have important consequences for real economic activity, employment and inflation. On the other hand, however, there is evidence that monetary policy does have an impact on desired leverage through its impact on the shape of the yield curve. A tighter monetary policy, by flattening the yield curve, may limit the buildup in leverage. 1 Whether it would be more effective to limit leverage directly by regulatory and supervisory means or via monetary policy is still an open question. But it is becoming increasingly clear that a totally hands off approach is problematic. I also believe we could have done better in our supervision of the large complex commercial banking organizations.

Among the important questions that need to be answered: 1. How does one identify bubbles – which I’ll define here as persistent large deviations in asset prices from their fundamental value – in real time? 2. What instruments can be used to limit the development of bubbles and/or allow bubbles to deflate in non-catastrophic ways that will not damage the economy in other ways? Turning to the first issue, identifying asset bubbles in real time is difficult. However, identifying variables that often are associated with asset bubbles – especially credit asset bubbles – may be less daunting. To take one recent example, there was a tremendous increase in financial leverage in the U.S. financial system over the period from 2003 to 2007, particularly in the nonbank financial sector. This sharp rise in leverage was observable. Presumably, this rise in leverage also raised the risks of a financial asset bubble and the impact of this bubble on housing certainly raised the stakes for the real economy if such a bubble were to burst. This suggests that limiting the overall increase in leverage throughout the system could have reduced the risk of a bubble and the consequences if the bubble were to burst. Turning to the second issue of how to limit and/or deflate bubbles in an orderly fashion, the fact that increases in leverage are often associated with financial asset bubbles suggests that limiting increases in leverage may help to prevent bubbles from being created in the first place.