samchain/econo-pairs-v1 huggingface dataset:
Through 2012, the European Central Bank (ECB) intervened with resolute measures to calm the markets. The banking system was offered large amounts of long-term funding. In summer 2012, the ECB declared that it was prepared to make unlimited purchases of debt securities from governments which fulfil the conditions for borrowing from the European Stability Fund. These measures seem to be working. 2  BIS central bankers’ speeches  Borrowing rates for debt-burdened countries have fallen markedly. Other risk premiums have also decreased. Fears of a euro-area breakup and the collapse of the European economy are no longer dominant. The European monetary union – after being established – cannot be dissolved without serious consequences for Europe and the world economy. There is little point in discussing whether the original idea was a good one or not. The child was born and is now a teenager. As expected, puberty has presented problems. These problems must now be dealt with by the European authorities. Budget deficits in Europe are being reduced, despite strong headwinds from the slowdown that follows in the footsteps of austerity. Structural reforms are being implemented to increase growth capacity over time. Business sector costs are falling and competitiveness is improving in the countries hardest hit by the crisis. Steps have been taken in the direction of closer cooperation and coordination of economic policy. However, the path ahead is long. We may have to wait until the next decade before growth gains a firm footing in Europe.

Inflation targeting has served us well. Monetary policy is the first line of defence in demand management. When the impact of the crisis was felt in the Norwegian economy in autumn 2008, the key policy rate was sharply reduced. This contributed to counteracting the negative effects on output and employment in Norway. A credible and firmly anchored monetary policy can curb the impact of external shocks. This increases the resilience of the Norwegian economy. Owing to substantial cross-border labour flows, changes in the competitive environment and new trade patterns, consumer price inflation has in periods deviated from the target. In such a situation, monetary policy must be oriented towards bringing inflation towards the target over time, while preventing excessive swings in output and employment. The appropriate amount of time that should be taken to reach the inflation target will depend on the shocks to which the economy is exposed and their duration. Chart 8: Rise in consumer prices and producer prices In today’s situation, it is appropriate to use a few years to bring up inflation. Prices for Norwegian goods have increased considerably more than consumer prices, reflecting the improvement in Norway’s terms of trade. Incomes, output and employment are rising at a solid pace. Household debt and house prices are still moving up. These are the key reasons why the key policy rate has not been lowered further. We will not lose sight of the inflation target.
Given the huge bills we, as taxpayers, are facing, that is very understandable. I welcome the ongoing discussion and many of the regulatory tools and changes that are being introduced. But while many of these new preventive tools – such as heightened capital requirements and liquidity regulation – will strengthen the resilience of the financial system, we can never completely eradicate the risk of a financial crisis. Also, over time, people either tend to forget or to put too much faith in some new remedy. This time, sophisticated risk management techniques and new models of financial intermediation fostered complacency among investors and regulators. Everyone seemed to believe that history would not repeat itself. But it always does. Regardless of the preventive measures we introduce, crises will reoccur. And when they do, you need to act effectively and swiftly with the regulatory framework you have at hand. Today, I am going to focus on what I see as the core principles of effective crisis management. I am going to give you some examples of what I see as good crisis management, but I will also show the detrimental outcome that may result when these core principles are violated. In addition, I will also touch upon how regulation may facilitate – but sometimes also hinder – the application of these crisis management principles. One of the lessons I have learnt is that resolving a financial crisis takes time. It is a messy process and it costs a lot of money.

The implications for monetary policy will depend on the relative magnitudes of these effects. In my view, and I am not pre-judging the views of the other independent MPC members, the economic outlook has deteriorated and some monetary policy easing will likely be required over the summer. The Committee will make an initial assessment on 14 July, and a full assessment complete with a new forecast will follow in the August Inflation Report. In August, we will also discuss further the range of instruments at our disposal. These judgments will benefit from the Bank’s joined-up approach. For example, the PRA’s direct line of sight of banks, building societies and insurers, and the FPC’s oversight of systemic risks, allows the Bank to understand better the net impact of any monetary actions on financial conditions, and ultimately businesses and households. As we have seen elsewhere, if interest rates are too low (or negative), the hit to bank profitability could perversely reduce credit availability or even increase its overall price. There are also interactions between prudential rules and the provision of credit in the face of large macro uncertainty. The Bank of England is well positioned to understand these interactions and will work across its policy committees to maximise the coherence and effectiveness of their efforts. I can assure you that in the coming months the Bank can be expected to take whatever action is needed to support growth subject to inflation being projected to return to the target over an appropriate horizon, and inflation expectations remaining well anchored.
Today, we are also taking the opportunity of this very auspicious occasion, with the grace of Allah, to lay the foundations for another initiative, the launch of the International Centre for Education in Islamic Finance, INCEIF. The Islamic banking and financial services industry has experienced profound growth in this recent decade. This growth is expected to accelerate further global expansion in demand for Shariahcompliant financial products and services intensify. To sustain and support the future growth of the industry, an important prerequisite is the development of the talent and expertise that is needed to drive innovation and to raise the performance of the industry to greater heights. The establishment of the International Centre for Education in Islamic Finance (INCEIF) represents an investment in human capital to support the global development of the Islamic financial services industry. Human intellectual capital plays a pivotal role in driving the performance and market competitiveness of the industry. Going forward, it will be the defining factor. The fast pace of innovation in global financial services in general and in the Islamic financial services sector in particular, will demand new expertise and skills. Indeed, there will be an increase in demand for adequately qualified professionals. In this environment, the creation of a substantial pool of talent and expertise is thus indispensable for the future growth of Islamic finance. Strengthening research and development capabilities is also important for enhancing the capacity for innovation to meet the diverse requirements of the rapidly changing global economy.

This includes regular press conferences by the Fed chair following FOMC meetings; the publishing of growth, inflation and short-term rate forecasts of FOMC participants; and a concerted attempt to lay out the guideposts that the FOMC will look at to assess progress toward our mandate. We are, though, still learning how to more effectively communicate, especially given our new and expanded set of policy instruments. A second area in which we can and must collectively do better is safeguarding global financial stability. Simply put, we failed to act both early enough and decisively enough to stem the credit excesses that spawned the financial crisis and the Great Recession. While the U.S. was not alone in this shortcoming, given our position in the global financial system we especially should have done a better job. We’ve taken important steps through new legislative mandates and a broader effort to rethink our regulatory and supervisory framework. In particular, systemically important banking organizations must now hold higher amounts of capital and liquidity that are better aligned with their risk profiles and the official sector is making progress in ensuring no financial firm will be too-big-to-fail. Although this remains very much a work in progress, these efforts should help us to avoid repeating the mistakes of the recent past, and enable us to be more proactive in mitigating potential future vulnerabilities. Of course, we at the Fed are not alone here.
This will leave a wealth of information for authorities to exploit as they direct efforts into strengthening further the current institutional framework and operations. All stakeholders are encouraged to seize the opportunity to improve the reputation, soundness and resilience of our financial services sector. Malta is also actively working to embrace blockchain technologies, including virtual assets. 2018 will also be remembered as the year when Malta was propelled to the fore with the introduction of a holistic legislative and regulatory framework for fintech and virtual assets, asserting itself as a digital hub. Such technologies provide the benefits of reducing transaction costs which can be passed on to consumers; greater efficiency, transparency, advancement in KYC capabilities and competition. While these benefits are acknowledged and duly welcomed, one must also be sensitive to the underlying potential risks they might pose as they become more main-stream. The effective implementation of the new legislation and regulation requires expertise not only in the underlying technology, but also in its legal aspects and all the risks involved, such as cyber risks. The fast technological advancements are also a challenge and staying ahead of the game from a  Page | 9  regulatory perspective should be given high importance for the successful development in this new field. Thus, while all the legislative initiatives for this new technology to succeed augur well, the authorities need to remain vigilant about the implications for financial stability stemming from the digital economy.

William C Dudley: The US economic outlook Remarks by Mr William C Dudley, President and Chief Executive Officer of the Federal Reserve Bank of New York, at the Washington and Lee University H Parker Willis Lecture in Political Economics, Lexington, Virginia, 1 April 2010. *  *  *  Thank you for that kind introduction and the opportunity to speak here today. The past few years have been an extraordinary time for policymakers. We have been very aggressive in providing support to the economy, and it now appears that a sustainable recovery is underway. However, given the headwinds created by the collapse of the U.S. real estate market and its consequent damage to the financial system and household balance sheets, it seems unlikely that the recovery will be as strong as we would desire. As a result, the substantial amount of slack in productive capacity that exists today will likely only be absorbed gradually. Consequently, trend inflation, at least over the near term, should remain very low. This is why the Federal Open Market Committee (FOMC) concluded at its March meeting that “... economic conditions, including low rates of resource utilization, subdued inflation trends, and stable inflation expectations, are likely to warrant exceptionally low levels of the federal funds rate for an extended period”. What I would like to do today is to explain in some detail the logic underlying this expectation that economic conditions will warrant exceptionally low levels of the federal funds rate for an extended period.
Consequently, to this end, the June Inflation Report in 2001 presented an inflation measure that was  1  See Heikensten, L, "The Riksbank's inflation target - clarifications and evaluation", Sveriges Riksbank Quarterly Review 1, 1999. 2  BIS Review 26/2004  adjusted to exclude temporary rises in prices. On that occasion there was no forecast for this adjusted measure. The third and most recent example is when the Riksbank decided last year to highlight UND1X excluding energy as an especially important index for assessing longer-lasting inflationary pressures. Energy prices had risen steeply around the turn of the year 2002/2003. We judged this rise to be temporary and expected energy prices to fall back again. This meant that the inflation rate would come to be affected for a reasonably long period by these temporary fluctuations in energy prices. At the monetary policy meeting in April 2003 the Riksbank judged that inflation towards the end of the forecast period would be somewhat below target if the repo rate were left unchanged. A strict application of our simple rule would have resulted in a repo rate cut, but since temporary fluctuations in energy prices were the chief reason for the inflation forecast being below 2 per cent, the Riksbank decided to leave the repo rate unchanged.

Therefore, it is necessary the society itself and international institutions support the establishment and strengthening of internal anchors. Which would be an efficient internal anchor? I think that the best internal anchor is a technician who thinks independently, proud of what he does, conscious for the results and the consequences of the proper actions. In other words, this implies the establishment of professional capacities as one of the cornerstones of long-term successful polices. The scientific education and research in this direction have an important and inalienable role. All the issues mentioned so far, as:   The new strategic model of economic growth;    The effective, efficient and consistent monetary policies with the economic growth;    The necessity for coordinated structural reforms in the region;    The challenges to European integration;    The common political economy of the region in the future;    The importance of internal anchors and the study and research of external ones, and;    The need for establishing capacities;  are included in the research work’s agenda of the Bank of Albania. It is a great pleasure that we already have the possibility to cooperate with a remarkable partner as Oxford University, a distinguished institution for the high-level research in political and economic sciences. For this collaboration, I hope and I believe that many issues I discussed above would have an answer, partial or a complete one.
In Turkey the figure is 52 percent, and is slowly but steadily declining. If we look at the concentration issue from another standpoint, using the data for November 1998 and taking into account the total assets of the sector, 65 percent of the Turkish banking system belongs to the top 10 major banks. If we include the 20 foreign banks and branches having a share of 6 percent, and the 14 development and investment banks having a share of 5 percent, it can be seen that 76 percent of the banking system is consistent with 10 big banks, foreign and investment banks. The remaining 24 percent of the sector belongs to 30 banks. Among these banks, there are banks that are leaders in the sector, functioning properly and effectively. However, a limited number of banks have practical problems which are well  BIS Review 31/1999  2  known to us. We know all their problems. We monitor them. The existing banking laws and other elements of the legal framework do not give us full authority to address them actively and efficiently. The problem of the state owned banks is occasioned by the state budget, and its solution involves different issues. Now let me talk about risk management in the Turkish banking sector. From the standpoint of risk management, we do have well-developed methods of risk management and for supervising the risks that we undertake.

The French insurance market has also enjoyed strong growth, with revenue up by almost 3% [2.7% and 3.1% in non-life and life insurance, respectively]. In response to the legitimate concerns that many of you have raised, I have chosen to focus on two main issues: the challenge of low interest rates (I) and our ambition for the Solvency II review (II). *** I. The challenge of low interest rates  A. The economic situation compels us to keep interest rates low I recently marked out the limits that I believe should be set for monetary policy. I thus feel all the more obliged to clarify why the low interest rates are needed, why they are going to continue, and how we have to adapt to them together. I hear your concerns with regard to low interest rates, and I fully understand them. However, it is important not to lose sight of the long-term perspective: low interest rates are not only driven by monetary policy – they are primarily the consequence of long-term structural trends, notably resulting from the  Page 2 of 6  change in the balance between a high level of savings and a fall in investment linked to an ageing population and the slowdown in productivity. The low interest rates thus reflect the historic low level of what economists refer to as the real natural rate of interest, R*, which has declined by around 2 percentage points over the last 15 years in both the euro area and the United States.
In other words, if we want to see if policy works or not, or if the economy has become less sensitive to changes in interest rates, then we should examine the slope of the IS curve, and not only of the Phillips curve.11 Empirical research on the IS curve is scarce, however. And the few studies available are generally not encouraging from a monetary policy perspective. They typically find that output does not respond, in a statistically significant way, to the real interest rate. 12 Often they even find a positive relationship between real interest rates and output. These findings are at best disturbing given that much of mainstream monetary thinking is built on the idea that firms and households take the level of the interest rate into account when making economic decisions. 8 / 14  BIS central bankers' speeches  To illustrate the empirical failure of the IS curve, slide 7, column 1, shows the estimated coefficients of a regression of the euro area output gap on its own lag and a measure of the real “interest rate gap”, i.e. the difference between the real ex ante interest rate and the time-varying natural rate.

In doing so, I will focus on two prime channels underlying the second stage of transmission: the exchange rate channel and the real interest rate channel. My remarks will therefore be neither exhaustive nor complete, given that monetary policy can affect the economy through many other channels as well, such as its impact on the valuation of equities and, hence, on firms’ cost of capital and investment decisions, Tobin’s q in short.3 Another channel of relevance is the bank lending channel as formalised by Bernanke and Gertler (1995). But by focusing on the exchange rate and interest rate channels, we can get a good understanding of how effective recent policy measures have been. In particular, I will show that monetary policy-induced exchange rate movements may have considerable impact on consumer prices, but that this relationship depends on the state of the economy and the shocks driving it, much in line with the recent literature in this field. And I will show that the New Keynesian Investment and Savings (IS) curve is alive and well in the euro area – that is, aggregate demand responds to changes in real ex ante interest rates, and can also be shown to have done so in recent times, provided it is measured properly. A state-dependent exchange rate pass-through Let me start with the exchange rate channel – a channel that has been heavily debated in recent months in the light of the large movements that we have observed in the foreign exchange market.
Instead, it is argued, monetary policy should be aimed at attempting to counteract financial imbalances to a greater degree, possibly even exclusively. In relation to this debate, Sweden finds itself in a rather unique position. We have discussed these issues for longer than most other countries, we have experience of a policy that was aimed, to a certain extent, at counteracting financial imbalances, inflation fell earlier in Sweden than in many other areas, and we have also – after a long period of highly expansionary monetary policy – managed to bring it back on target. In other words, we have a number of experiences to share. Here, I have given an account of what I consider have been the most important experiences: that it is important not to lose sight of inflation and inflation expectations, that it may take significant interest rate rises to halt the accumulation of financial imbalances and that it may take a long period of highly expansionary policies to bring inflation up – but that it is possible to bring it up. In conclusion, to avoid misunderstandings, I would like to emphasise that my comments today do not, in any way, mean that I consider that central banks should not have any role or responsibility for financial stability. That issue deals with much more than whether or not it is appropriate to address financial imbalances with monetary policy and the policy rate.

The Yellen camp’s view is that the Phillips curve looks largely as it normally does or, at any rate, has changed so little that it still works as an effective channel through which central banks can influence inflation. According to the Borio camp, the Phillips curve has instead almost broken down or, at any rate, changed so  9 [20]  much that it no longer forms a central part of the inflation process. More specifically, high resource utilisation no longer results in higher inflation, according to this view. Instead, it is claimed, inflation is highly influenced by structural factors. Factors often emphasised as exerting downward pressure on inflation are globalisation and, looking forward, more and more digitalisation. 14 These are arguments that those who have followed the debate in Sweden in recent years will recognise. According to this view, the central banks will find it difficult to steer inflation for a long time to come. As I mentioned in my introduction, taken to its conclusion, this means that it is pointless to set up targets for inflation, as this is mainly determined by factors outside monetary policy. As I also noted earlier, the Yellen camp does not share this view but believes that inflation targets are meaningful, important and possible to attain. Implications of the Swedish experiences What view, then, should we take of the international debate in light of our experiences here in Sweden? As I see it, our experiences overall are more in line with the Yellen camp's view.