samchain/econo-pairs-v1 huggingface dataset:
Of course, I realize that most of you are already fully convinced of the need to seriously address the Year 2000 issue and are more interested in advice on how to tackle the problem. In this regard, I will focus on approaches that supervisors can take in five areas: (1) encouraging cooperation and coordination; (2) encouraging information sharing and disclosure; (3) developing assessment plans; (4) encouraging testing programs; and (5) developing and supporting contingency plans. Cooperation and Coordination The single most important piece of advice that can be given on the Year 2000 problem is to work cooperatively with others. This applies at a number of levels. First, every organization should develop an internal Year 2000 plan that encourages cooperation between different parts of the organization. For example, a successful Year 2000 program for an organization will encompass not only the software programs that are maintained by the information technology department, but will also address the Year 2000 risks that may be posed by the embedded chips in the firm’s buildings, including heating and cooling, building security and safety systems. The benefits of cooperation include the sharing of information, so that the resources required to obtain valuable information can be reduced. Cooperation across organizations is also essential to the development of joint industry initiatives, including testing programs. For example, we have seen industry associations play a very valuable role in raising industry awareness and providing a focal point for the sharing of information and the development of joint Year 2000 initiatives.

Nevertheless, a level of conservatism in minimum standards will be retained, which any responsible and prudent banker would no doubt agree with, at least in principle. Models are an abstraction of reality. Supervisors will continue to maintain a healthy sense of skepticism. Despite good intentions and best efforts, predictions made by models are never exactly right and sometimes very wrong. Conclusion In conclusion, we should not look at the release of the final version of Basel II as the end of the process to set more risk-sensitive capital adequacy requirements for banks. It is really the end of the beginning. Basel II is a milestone on a longer journey. One that will occupy the energies of bankers and prudential supervisors for many years to come. This is not meant to be a discouraging note. Quite the contrary. Because this journey will be one of continuous improvement that can, if we do our work well, lead to stronger banks and more resilient financial systems. I wish you all useful discussions on the major challenges to be addressed, and on the important benefits that await us as we continue this journey. 4  BIS Review 42/2004
This means that the core banking services on which retail and small business customers depend should not be threatened should things go wrong in wholesale financial markets or the global economy. We do not expect most people to notice significant change day-to-day once the new regime goes live. But should we experience again the sort of threats to the financial system we saw during the crisis, ring-fencing will help ensure banking groups are easier to sort out if they get into trouble, and can fail with less impact on the economy and taxpayers. Banks have now largely completed the ring-fencing of their retail operations, and have done so with little disruption to their customers and counterparties. The PRA’s supervisory focus will turn to ensuring the ring-fences that have been established are effective in practice, and remain so. Ring-fencing both broadens the range of regulatory requirements, and increases the intensity of supervision, for the groups in scope. As such, ring-fencing will remain a focus for the PRA – as well as for the banks themselves – in the coming years. How will the next crisis be different? Financial crises generate significant and persistent costs. The Bank of England has estimated that the costs of crises amount to 75% of GDP on average.1 The previous crisis resulted in the Government providing £ billion of capital to RBS and Lloyds to prevent them failing and disrupting the provision of vital banking services to their customers.

Low for long makes demand management of the economy more difficult in downturns, reducing the space for monetary policy easing with conventional tools. This is because, for a given inflation target and with the reduction in long-run real rates, policy rates are closer to their effective lower bound. Changes in the structure of the financial system as a result of low for long may also weaken the transmission mechanism. Monetary policy, to be clear, is not powerless at the effective lower bound. As post crisis experience has demonstrated, ‘unconventional’ monetary policy tools can and have provided stimulus when interest rates are at or near the effective lower bound. These are now very much a part of central bank toolkits.24  22 For example, the share of corporate debt owed by UK companies with a ratio of net debt to EBITDA  greater than four was 35% in 2018, compared to 28% in 2007. 23 See Bank of England (2019), Chart F.6. 24 See, for example, a recent BIS paper that conducts a cross-country analysis of unconventional monetary policy tools. Potter, Smets et al (2019).
I believe it is important for us to highlight these job trends and to understand their implications for our region. There have been significant and long-lasting changes to the nature of work. As a result, many middle-skilled workers displaced during the recession are likely to find that their old jobs will never come back. Furthermore, workers are increasingly facing higher skill requirements in order to land a good job. These dynamics in the labor market present a host of challenges for the region to address. However one thing is clear: workers will need more education, training and skills to take full advantage of the types of job opportunities being created in our region, as well as across the nation. So, it’s important that we work together to find ways to help people in our region adapt to these changes. I will now ask Jaison Abel to provide an update of economic conditions in our region. 2  BIS central bankers’ speeches

More generally speaking, the evidence suggests that the reallocation of capital from declining industries to industries with high investment opportunities and high productivity is faster in countries with developed financial markets. These findings suggest that countries with more liquid capital markets and a developed banking system are growing faster on average. 15 Increasing product market competition – at the EU and national levels – would enable more efficient production structures. The benefits of opening network industries to competition can be seen in the telecommunications sector. The hourly labour productivity in this particular sector saw a significant acceleration from 4.5% to 7.3% from the periods 1980-1995 to 1995-  11  See the ECB Occasional Paper Series No 44 “Competition, productivity and prices in the euro area services sector”, by the Task Force of the Monetary Policy Committee of the ESCB, April 2006. 12  European Commission, “The single market: review of achievements”, November 2007. 13  Today, the services sector accounts for 70% of GDP, 68% of employment and 96% of the new jobs created, but only 20% of intra-EU trade. This discrepancy reflects not only the fact that services often have an intrinsically local character, but also the many barriers and obstacles still hindering the free movement of services within the European Union.
In summary: SWESTR should replace STIBOR – the Riksbank will play an active part in this work So to summarise, my message here today is this: The reference rates that have been dominant for several decades have clear flaws, and this is true both internationally and in our own Swedish financial market. Due to the Riksbank starting to provide SWESTR for the Swedish market, there is now a robust and reliable alternative to STIBOR. So there are good reasons to start the transition from STIBOR at its shortest maturity (STIBOR T/N) to SWESTR as soon as possible, in line with international developments. It is not work done from one day to the next, but it is a job worth doing. In the longer run, it should also be possible for SWESTR to replace STIBOR at longer maturities. The Riksbank will support this transition in various ways. Our goal is that the dominant reference rate in the Swedish financial market shall be of the highest international standard and that requires both support from us as authorities and a high level of ambition among the various market participants. Thank you for listening. I look forward to your questions and comments. 1  Tomorrow-next refers to a deposit from the next business day to the following business day. The Riksbank collects data both on short-term money market transactions in Swedish kronor and on other transactions that may form the basis of STIBOR. Transactions under ten million kronor do not have to be reported.

One lesson that authorities in this part of the world drew from the financial crisis in the late 1990s was that strong policy fundamentals are not always enough to guard against the vagaries of international capital flows. A sizable cushion of international reserves is important as a buffer to guard against sudden changes in market sentiments that can lead to capital outflows and pressures on the currency. Starting shortly after the Asian financial crisis reserves were thus accumulated in the region to build up such buffers. But holding large amounts of reserves is of course costly as they are typically invested in highly liquid assets with relatively low yields compared with some alternative uses of the funds. It is partly for this reason that authorities in the region have taken steps to create a mechanism for pooling some of their reserves in the form of the Chiang Mai initiative which started in year 2000 and its multilateral extension which was agreed on in 2010. While the size of the pool of reserves under the Chiang Mai agreement is relatively modest compared to the potential needs for some of the larger economies in the region, the importance of the agreement goes far beyond the aggregate amount of reserves involves. It reflects a desire by authorities in the region to foster financial cooperation in the region while at the same time creating arrangements which will help safe-guard financial stability.
Ardian Fullani: China-Europe economy – future challenges and opportunities Address by Mr Ardian Fullani, Governor of the Bank of Albania, at the China-Europe Economists Symposium on “China-Europe economy – future challenges and opportunities”, Tirana, 17 January 2013. *  *  *  Dear Mr. Chairman, Dear Colleagues, Ladies and Gentlemen, It is a great pleasure for me to participate in this Symposium. The rapidly evolving economic landscape of the past few years poses to policy-makers a demanding set of challenges and opportunities. I am sure that the honest and productive exchange of ideas will facilitate a deeper understanding of the problems we are facing and will allow us to design more appropriate strategies for overcoming them. Introduction Our topics of discussion today focus on the performance and prospects of China and Europe, the two economic regions which probably are at the opposite ends of the spectrum of contagion from the global crisis. While China has remained largely unaffected, Europe has suffered significantly. The crisis exposed fundamental structural and institutional weaknesses in the Eurozone and the EU. In my short address, I will concentrate on the current state of Europe’s economic and financial situation. It would be almost an understatement to define the past, the current and the expected developments in the Europe, as difficult and short-term. The so-called “Great Depression” tested the Eurozone and the European economy. EU convergence process proved to be incomplete, from economic and institutional point of view.

It would be unconceivable to think of a financial system and indeed of any financial instrument without a legal system to support it. The keyword for economists in this context is “asymmetric information”: the lender, in particular, does not know if the borrower is trustworthy or not, or whether the investment project the latter is undertaking is worthwhile. A financial asset is ultimately a claim in the form of piece of paper or even, and increasingly so, an account entry. In any credit relationship – and this includes almost any economic transaction beyond simple barter – the possibility of default is always looming and this inherent complication cannot be solved without a precise system of norms that protects both the creditors and the debtors. For the creditor to consider entering in a financial relationship, the legal system must not make it too easy for the debtor to walk away from his obligations. At the same time, the legal system cannot be too taxing for the debtor, as Shakespeare’s Merchant of Venice reminds us. The legal system has thus to develop along a fine line between protecting the rights of the borrowers as well as those of the lenders. No wonder that developing a sound legal system to support financial markets is a very complicated matter and we hope to learn something from today’s conference. 2.
Today, Mainland China is already the second largest economy in the world and the single biggest contributor to the world’s economic expansion, creating nearly one-fifth of the world’s newly-generated economic activities. 4. The China factor creates many different opportunities for Hong Kong’s financial services industry. Today I will highlight two aspects that I believe are key drivers for growth in the next few years. The first is the gradual financial liberalisation in Mainland China and the second is the wider external use of the renminbi (RMB). The gradual financial liberalisation in Mainland China 5. In the gradual financial liberalisation process in Mainland China, we can observe three key patterns: inflows being de-regulated before outflows, direct investment flows being liberalised before portfolio investment flows, and collective investment schemes being relaxed before individual investors. 6. Specifically, during the early stages of Mainland China’s reform process, in the late 1970s and early 1980s, only Foreign Direct Investment (FDI) was encouraged. Hong Kong has been the largest source of FDI for the Mainland, accounting for more than half of the total amount in 2009. In the opposite direction, Mainland China’s Overseas Direct Investment (ODI) has also been liberalised gradually over the years. Hong Kong has been the largest recipient of ODI flows from the Mainland. At present, about 60% of ODI from the Mainland has gone to Hong Kong or via Hong Kong to other places.

Hong Kong is the first and so far the only place outside the Mainland that has developed a RMB bond market. So far, 19 RMB bonds have been launched in Hong Kong with a total issuance size of over 50 billion yuan. The issuer base was expanded from only Mainland Chinese banks at the start, to Mainland subsidiaries of Hong Kong banks and China’s Ministry of Finance in 2009, and further to Hong Kong corporations and international institutions like McDonald’s and the Asian Development Bank this year following an important elucidation regarding the operation of RMB business in Hong Kong in February. 20. The net effect is that any issuers, including foreign corporations and multilateral organisations, are now free to issue RMB bonds in Hong Kong, just as they can issue bonds in any other currencies. Of course, if the proceeds are to be used on the Mainland, the moving of funds into Mainland China will have to meet the requirements there. By the same token, banks can now also offer RMB trade finance, corporate loans, syndicated loans and project finance to their clients in accordance with Hong Kong’s existing banking practices. 21. The latest developments have provided more flexibility and larger scope for the further development of RMB financing activities in Hong Kong. As the pool of offshore RMB funds in Hong Kong continues to grow, there will be huge opportunities for financial institutions to take part in RMB financing as well as in the origination, distribution, investment and trading of RMB bonds. 22.
This means that private actors are willing to lend long-term to the state without any significant compensation, or are even willing to pay to lend. This can, without exaggerating, be described as a pretty generous offer. It is not very difficult to imagine that it is possible to find areas in which public investment may be needed and where the funds borrowed to implement that investment may well have a positive return because the cost is very low or negative. Why this has not happened to a greater extent than has been the case is not entirely easy to understand. One probable explanation is that many countries have put in place rules to prevent or counteract increased borrowing. The reasons for  13 See, for example, Blanchard (2019), who also notes – possibly somewhat surprisingly – that the tendency for  growth to exceed the risk-free interest rate is not a new phenomenon. A summary of the changed view of the role of fiscal policy is available in Lagerwall (2019). 8 [17]  this are good if we look at past negative experiences. However, if this is the explanation, it is natural to start to consider whether these rules are actually adapted to the changes that have taken place in the macroeconomic environment since they were introduced, particularly the fact that the level of interest rates has been historically low.

And customers are now more appreciative of the improved quality of product and services offered by the industry players. Customers can now conduct their transactions with proper documentation and in more secure premises. The public image of the industry has certainly improved. What we have achieved so far proved that with collaborative effort, we can achieve significant milestones. Our transformation journey is not over. It is long. It is fraught with challenges and we will encounter much passive resistance along the way. But it is a journey that is abound with opportunities. BIS central bankers’ speeches  1  Expectations and scrutiny of the industry will continue to increase, particularly with the growing concerns over risks posed by money laundering and terrorism financing activities. But we shall practise proportionate regulation. The Bank will assess risks and compliance based on the individual company’s business profile. We are confident that all licensees will be able to comply with the minimum standards set by the Bank. Where necessary, additional investment in resources should be made including, recruiting suitable talent and acquisition of new systems. Immediate priorities for the industry Vision for the Future The world we are living today has changed significantly. The old rules do not work anymore. New rules are continuously being formed and constantly evolving. The advent of information technology has changed the way we live and the way we do business. We are more integrated with the outside world. The world is increasingly more interdependent.
They should also be designed to avoid significant distortions to price signals, which is particularly important to avert any feedback into the inflationary process. This is a further reason to avoid both an across-the-board fiscal impulse and a very widespread use of automatic indexation clauses in expenditure items. Forgoing such clauses should be part of the incomes agreement, which is the second ingredient of the economic policy response to the war that I would like to mention. An incomes agreement The priority objective of the incomes agreement that we have been advocating in recent months at the Banco de España is to avoid triggering an inflationary spiral that would only exacerbate the harmful effects of higher energy prices. It would consist of an agreement between firms and workers, under the framework of social dialogue, to share the inevitable loss of national income that higher commodity import prices entail. These are goods which we do not have, but which we need for domestic production and consumption. What are the features that should characterise such an agreement? First, it should address the asymmetric impact of the shocks, combining the necessary coordination at national level with mechanisms to adapt the agreement to the existing differences in productivity and activity across firms and sectors. If there are segments of households whose standard of living has been hit particularly hard by rising inflation, the incomes agreement should also seek to mitigate their straitened circumstances.

Second, it would also be advisable to avoid arrangements that automatically link wages to past inflation or indexation clauses, with the aim of reducing the risk of a wage-price feedback loop. In addition, the incomes agreement should include multi-year commitments relating both to wage increases – where the nominal benchmarks for wage bargaining should exclude components associated with energy products and be based on the projected trend in underlying inflation – and to job protection. Lastly, the agreement needs to be complemented by explicit and verifiable profit margin moderation commitments. Monetary policy The third economic policy element I would like to refer to is monetary policy. In the inflationary context I have already described, the ECB has embarked on the process of monetary policy normalisation, starting from an extraordinarily accommodative position. Before the onset of the pandemic, the ECB maintained highly accommodative financial conditions through the asset purchase programme (APP) and negative interest rates. The aim was to drive inflation, which had remained persistently below 2%, to levels close to our target. During the pandemic, in an effort to combat the risk of financial fragmentation and  11  the deflationary trends, the ECB rolled out, among other measures, the pandemic emergency purchase programme (PEPP). The measures taken by the ECB are part of the new strategy approved by the Governing Council in 2021, which established a symmetric medium-term inflation target of 2%. Medium-term guidance means that decisions are conditioned by the inflation projected over a two or three-year horizon.