samchain/econo-pairs-v1 huggingface dataset:
A major aim of regulatory reform should thus be to ensure that trust does not dissipate so rapidly and completely again. In order to do this, we need to increase capital requirements, both in terms of the quality of capital and the amount of capital. After all, capital provides protection against bad outcomes. Increasing the quality and amount of capital will increase the resilience of individual banks. In addition, strengthening the ability of banks to absorb losses mitigates the risk of contagion – therefore more and better capital will also strengthen the resilience of the system. In my view, the important part of capital is loss-absorbing common equity. In addition, other forms of capital are needed to protect the state. If a bank defaults, capital typically evaporates very quickly. I have seen many examples of banks that have defaulted because they did not meet the capital adequacy rules. In my experience, when bank managers say that they have a problem, they often claim to have – say – 6 per cent regulatory capital, rather than the required 8 per cent. When the authorities eventually and realistically assess the assets, capital is often negative and the state has to bail out the bank. Thus, capital should be of good quality to protect the bank on a going concern basis, but also to protect the state in the event of a default.

In Q1/2022, global debt has increased by $ trillion to a new record of over $ trillion, largely driven by the world’s two largest economies, China and the US, while China’s debt rose by $ trillion in Q1, the US added $ trillion (Figure 3). Page 1 of 3  intense than during the taper tantrum and the initial Covid shock in 2020. Currency movements have largely mirrored USD appreciation. Part of this reflects stronger fundamentals and large buffers: including deeper local markets, sound fiscal positions; high foreign exchange reserves; well-capitalized banks; low foreign currency debt; and lower foreign holdings of local assets. •  How small open economies should respond varies by country, depending on their context. Countries with stronger policy frameworks, sound external and internal finances, and a broader range of tools--including FX intervention and macroprudential measures--are in a better position to manage the risks and trade-offs resulting from tighter global financial conditions. In Thailand, for example, our circumstances have allowed us to take a more gradual and measured approach towards policy normalization. Part 2: The second challenge is the shifting international trade and geopolitical landscape •  The need to build more resilient supply chains, coupled with the more polarized international environment, has given greater impetus to de-globalization or at the very least to reglobalization. A survey of Fortune 1000 companies found that 94% experienced problems from supply chain disruptions from Covid-19. The likely trend towards reshoring, near-shoring, and friend-shoring is leading to potential reconfigurations of global supply chains.
William C Dudley: Regional economy and current trends in regional employment Remarks by Mr William C Dudley, President and Chief Executive Officer of the Federal Reserve Bank of New York, at the Quarterly Regional Economic Press Briefing, New York, 6 May 2011. *  *  *  Good morning and welcome once again to the New York Fed’s Quarterly Regional Economic Press Briefing. I am pleased to have this opportunity to talk with the journalists covering our region – and through you, to the people in our District. This morning I will discuss national and regional economic conditions, with particular attention to employment trends in the Second Federal Reserve District, which covers New York; northern New Jersey; Fairfield County, Connecticut; Puerto Rico; and the U.S. Virgin Islands. I will not comment on the outlook for monetary policy today but instead will focus on the economy itself. Following my remarks, my colleagues will provide more detail. As always, what I have to say reflects my own views and not necessarily those of the Federal Open Market Committee (FOMC) or the Federal Reserve System. National economic conditions I’ll begin by commenting on national economic conditions. Since the recession ended in 2009, the economy has grown at a modest pace. When we met in February, the brisker pace of growth in the last quarter of 2010 appeared to be carrying over to the beginning of this year.

They will benefit from these changes by using the richer data to develop new products and services and by streamlining processes, making their businesses smarter and more efficient. The move to the renewed RTGS is a crucial transition requiring considerable change, but there is a big prize: to enhance the payments industry for everyone, including customers. Cross-border payments And this prize extends beyond domestic payments, and could enhance cross-border payments too. The importance of cross-border payments is growing, and the value of global cross-border payments estimated to soar from almost $ trillion in 2017 to over $ trillion by 20279. Yet they still suffer from a number of long-standing challenges. Enhancing the speed, cost, transparency and access to cross-border payment services would have widespread benefits for citizens across the globe both directly and indirectly –by supporting economic growth, international trade and global development. For these reasons, the G20 has made enhancing cross-border payments a priority. In October 2020 the Financial Stability Board (FSB), in close collaboration with the Committee on Payments and Market Infrastructures (CPMI), published a roadmap to enhance cross-border payments.10 The roadmap is made up of 19 building blocks, grouped into five focus areas ranging from enhancing the existing payment infrastructures, to advancing consistent international rules and standards, to more exploratory steps such as multilateral platforms and CBDC (see Annex 1Opens in a new window). 11 of the 19 building blocks are owned or co-owned by the CPMI, and I am the Deputy Chair of the Programme Co-ordination Board that oversees this work.
In this situation it is possible that unemployment will still be high, as changes in employment often occur somewhat later in the economic cycle than changes in other variables, such as growth. This is illustrated in our forecasts for the repo rate and unemployment presented in the February Monetary Policy Report. It is important to remember in such a situation that monetary policy is forward-looking and that its primary task is to create good long-term conditions for the economy by maintaining price stability. Let me illustrate this by means of two monetary policy episodes. ”Too low” versus "too high” inflation The last time the repo rate was very low, with a lowest point of 1.5 per cent, was in 2005. Inflation was then below target and the Riksbank received criticism from various parties for not cutting the repo rate further. Sweden was on its way into an economic upturn, but the labour market was nevertheless relatively weak. There was a lot of talk about "jobless growth”, that is, growth that does not create employment. Some said that the reason more jobs were not created was that monetary policy was too tight. The Riksbank made a different assessment. The view of the Executive Board was that it was underlying factors on the supply side, such as productivity, increased competition in the food sector and low-price imports from emerging economies that were decisive for the low inflation and employment. None of these factors would have been affected by a repo rate cut.

The Executive Board’s assessment was that monetary policy was sufficiently expansionary given the demand situation and they pointed to the fact that credit volumes and house prices were increasing at a rate that was not sustainable in the long run. They therefore began to raise the interest rate in January 2006, a little sooner than if they had merely given consideration to the inflation target. The Riksbank had no target for either credit volumes or house prices. But these were variables that might be expected to affect inflation and the real economy. If the credit volume and house prices had continued to rise rapidly this would have risked triggering larger adjustments further ahead. One reflection that can be made here is that if the interest rate had been cut even further in 2005, which was suggested by several outside of the Bank, the current situation might have been worse. There would probably have been a larger credit expansion and higher house prices that would have needed to be adjusted later. This could have put our economy in a much more vulnerable position and thereby worsened the current economic downturn. Another experience is from autumn 2007, when energy and food prices increased considerably, which contributed to pushing up inflation. It is also an example of a supply side shock, as these prices are set in the world market. Swedish monetary policy cannot affect them. But at the same time, domestic cost pressures were relatively high. Productivity growth had slowed down, while wage costs were rising.
Jan F Qvigstad: What is a useful central bank? Speech by Mr Jan F Qvigstad, Deputy Governor of Norges Bank (Central Bank of Norway), at Norges Bank’s Symposium “What is a useful central bank?”, Oslo, 18 November 2010. *  *  *  It is a great pleasure for me to welcome you to this symposium. I would like to extend a special welcome to those of you who have travelled a long distance to be here today. November probably does not do justice to Oslo. To do that, we would have held the symposium in February or March, to show you the winter landscape, or in June or July, so that you might experience light summer nights. But November it is, and not without reason. You all know that the Governor of Norges Bank, Svein Gjedrem, will soon have served his two terms. The governor will step down at the end of the year. The Governor has always believed that too much attention is paid to persons and there is too little focus on the position that the person holds. By organising this symposium on a theme of keen interest to the Governor, we have tried to combine the strictly academic with respect for the way the Governor has filled his role.

These forces have kept interest rates depressed throughout the recovery and into the expansion, and include demographic change, slower potential growth, higher credit spreads, lower desired investment and a lower relative price of capital, changes in income distribution, private deleveraging and lower public investment. Given the likely persistence of these forces, our expectation is that the path for the real interest rate that balances demand and supply, will recover only gradually and to a limited extent compared to the pre-crisis era. The journey to monetary policy normalisation is still young. 24  There are potentially multiple interest rate paths consistent with inflation returning to target, as shown in Broadbent (2015b). Of these, a policymaker’s preferred path would reflect their perception of the balance of risks, preferences over policy trade-offs, view of the transmission mechanism, and “model” of the economy. BIS central bankers’ speeches  17  Annex: A simple Wage Phillips Curve A simple Wage Phillips Curve similar to Gali (2011) can be written as: =  +  +  +  +  is nominal wage inflation, is inflation expectations over where is a constant, is the unemployment rate, which, in theory, enters relative to the natural some horizon , rate of unemployment, ∗ . This is unobserved and is partly captured by the residual, (which also captures measurement error and other sources of unexplained variation in wage growth such as compositional effects). The presence of lagged wage inflation allows for some degree of wage indexation or inertia.
At which point, for example, did the run up in UK house prices over the past 10 years cease to be warranted by a change in economic fundamentals, such as the rise in the number of households and the move to a low and stable inflation environment? Likewise, at which point did it become clear that sub-prime lending had ceased to be a beneficial financial innovation with the scope to allow people who had not previously had access to credit the chance to own their own home and had instead become a source of international financial instability? These are difficult judgements. They involve second guessing outcomes generated by financial and economic markets. Policymakers will inevitably sometimes get the assessment wrong, with costly repercussions. But these judgements cannot be ducked. Monetary policymakers have to form views about a range of uncertain and ill-defined issues, such as the level of potential supply and the credibility of policy. The sustainability of asset prices and economic imbalances are no different. Ultimately, a policy has to be set even if explicit judgements are not formed. But policymakers also need better tools to back up these judgements with actions. Shortterm interest rates are a blunt instrument best deployed maintaining a broad balance between nominal demand and supply. They are not well suited to the task of managing asset price bubbles and economic imbalances. They may be wholly ineffective in addressing some types of imbalances, particularly those with an international dimension.

The public commitment that the Committee will do whatever it takes to hit the inflation target is central to the conduct of monetary policy. It underpins the credibility of the inflation target. This commitment is more important than ever in the current environment of unprecedented shocks and unconventional policy measures. Recent events have raised the question of whether the Committee could provide even more information about its policy strategy by committing to keep interest rates low for a particular period of time or until the economic outlook evolves in some specified way. The difficulty is in designing such a commitment that would be both useful and that the Committee would be willing to adhere to. A commitment to keep interest rates low for a certain period of time runs the risk of being overtaken by events. The past eighteen months has demonstrated only too well how rapidly the state of the economy can change. I truly have little idea as to how long Bank Rate will need to be maintained at its current low level in order to meet the inflation target. As such, it would make little sense to commit to a rule that suggested I did! The potential benefit of a state contingent commitment – in which the MPC commits to maintaining Bank Rate at its current level until the economic outlook has evolved in a particular way – is that it may aid the public’s understanding of how the Committee is likely to react to economic developments.
Market-based finance: a macroprudential view Speech given by Sir Jon Cunliffe, Deputy Governor Financial Stability, Member of the Monetary Policy Committee, Member of the Financial Policy Committee and Member of the Prudential Regulation Committee  Asset Management Derivatives Forum, Dana Point, California Friday 9 February 2017  I’d like to thank Lauren Anderson, Leo Fernandes, Katie Low, Pippa Lowe, Christina Segal-Knowles and Carlos van Hombeeck for their assistance in preparing this speech. 1  All speeches are available online at www.bankofengland.co.uk/speeches  In 1849 Thomas Carlyle branded economics as the ‘dismal science’. That was almost certainly unfair. But unfair or not, the tag has undeniably stuck fast; the public’s perception of economists is that it is a gloomy profession. 1  Central banking generally has picked up much of that gloomy reputation, along with a reputation for being pretty unintelligible - and occasionally deliberately so. But within the profession of economists and the community of central bankers in the years since the financial crisis, the prize for gloominess, and perhaps for unintelligibility, probably goes to those of us charged with financial stability and what is now known as macroprudential policy. The root cause lies in what we do – or perhaps more accurately in what we are trying to achieve which is very different to that other core objective of central banks, monetary stability. Those of us pursuing monetary policy are essentially concerned with central probabilities.

7  The international reform effort following the crisis has of course been focused precisely on reinforcing resilience and enabling resolution of banks, particularly globally systemic firms, to ensure a much safer channel of cross border bank finance. 8 Coeure (2014) 9 The speed of growth can itself be a risk which is not covered here. For example, the FPC has highlighted that the speed of credit growth in China (both inside and outside the formal banking sector) as a risk to global financial stability. See also Adrian (2017). 5  All speeches are available online at www.bankofengland.co.uk/speeches  5  However, outflow of markets based finance particularly in fixed income have played a role in crisis. 11  there is evidence that asset managers may now behave more pro-cyclically (Chart 3). 10  And  So there are  reasons, for those charged with thinking about ‘what might happen’, to question whether the past remains a good guide to the future. Funds now encompass a broader spectrum of investors and invest in a much broader range of markets and products. The bulk of flows into funds since the crisis have been into funds invested in less liquid debt instruments and, due to the search for yield, in the riskier parts of the market. In this respect, given market news in recent days, it is worth noting the selling of volatility by asset managers – including it would seem to retail investors. The liquidity risk is amplified by a number of factors.
The inflation target and the Industrial Agreement together contributed to this development. This underlines the importance of the inflation target as a nominal anchor for the Swedish economy. 6 [16]  Diagram 3. Swedish real wages from 1970 Index, 1970 =100  Note. The broken line marks 1995, the year when the inflation target entered into force. Sources: The National Mediation Office and Statistics Sweden  Thirdly, the fiscal policy framework has contributed to the successful consolidation of Swedish public finances and these are now in a very good state. This has increased market confidence in Sweden's ability to keep its public finances in order. The difference between Swedish long-term market rates and those in other countries can be seen as a measure of this and of confidence in the Swedish economy as a whole. At the beginning of the 1990s, the long market rate in Sweden was quite a lot higher than the European and American rates. Confidence in the Swedish economy was low and most people believed that the rate of inflation would remain high. During the thirty years that have passed, the interest rate differential has shrunk and for quite some time the long-term interest rate in Sweden is at roughly the same level as in Germany. 7 [16]  Diagram 4. Government debt and interest differential Central government debt as a percentage of GDP and interest differential on 10-year government bond yields  Note. Share of GDP and percentage points difference.

data at the level of individual firms, used in micro-prudential analysis. As mentioned before, a range of important data needed for macro-prudential analysis relate to firm-specific data on financial firms. Risk assessment tools for example, such as stress tests to assess the relevance of specific risk scenarios, are labelled macro-stress tests (as opposed to the “micro” tests run by banks individually at the request of the regulator). Nevertheless, the usefulness of these tools depends on the quality and detail of the bank-specific data. The relevance of the results for macro-prudential purposes is, of course, to be found in the aggregated figures (the impact on banking sector capital) and their subsequently interplay with the macro-financial environment, lending activities and overall growth. For stress testing tools, selected supervisory data are important for achieving reliable results. However, for other types of analytical tools and indicators, the use of publicly available information may be sufficient, or even preferable for reasons such as the comparability of  BIS central bankers’ speeches  3  data across financial firms or transparency. In official financial stability publications, for example, it is often considered important that readers and market analysts are able to replicate analyses with information in the public domain. Generally speaking, while it is essential that supervisory data are well protected, there would be merit in distinguishing between different layers of confidentiality and, thereby, to facilitate that selected supervisory information is made available for macro-prudential analysis.
In those same two years, US banks have increased their lending by more than 8% (Chart 2). Within Europe, the correlation between the market’s assessment of a bank’s capital base at the end of 2011 and that bank’s lending over the subsequent year is striking (Chart 3). Without an adequate capital base, banks will be wary of lending and, if they do, will find themselves needing to turn off the lending taps when the unexpected happens, as it inevitably does. Investors will lack the confidence to fund banks cheaply, raising the cost of credit to the real economy, and most importantly, you will lack the confidence that credit will be available if you need it. That is why the Bank of England has established a threshold for the capital base of the major banks and building societies after taking account of likely future losses, fines for past misconduct and prudent calculations of risk. That threshold, a capital base of 7% of their riskweighted assets and at least 3% of their total assets, must be crossed if the system is to be able to support and sustain the recovery. Some of the UK’s major banks had already crossed it, and over the summer we have made sure that the others put in place plans to reach it. The plans do not involve cutting back lending to the real economy.

Unemployment in the EU and the euro area has reached historic levels, especially amongst the youth. Economic growth is weak and is mainly concentrated in central countries of the euro area. Our countries have been affected by this situation for objective reasons. Trade relations, movement of capital and workers, and the financial system are channels that pass these problems on to our economies. The form, size and extent of this impact have evolved over the past four years. At present, the situation is reflected in the decrease of domestic demand, decline of economic growth, reduction of available income, loss of confidence and deterioration of optimism; this is, in turn, reflected in higher savings. Consequently, these developments have placed the focus of economic policies towards economic activity and revitalisation of optimism in order to boost investments and consumption. On the other hand, maintaining financial stability becomes a necessity, creating thus a binomial of priorities that condition each other and require a simultaneous solution. The Albanian economy is increasingly facing the challenge of economic growth. Although the Albanian economy enjoys consolidated macroeconomic stability and sound financial foundations, aggregate demand has been weak during the first nine months of 2012. Both domestic and foreign demand suffer from high uncertainty, relatively tight lending standards, and limited space for discretionary and stimulating policies.