samchain/econo-pairs-v1 huggingface dataset:
Need to address communications  Finally, to successfully address this risk with a unified front, we must develop an approach to enhanced communications around cyber threats and events, and revisit supervisory guidance in this area. Silence and fear of sharing intelligence in this area could be detrimental to efforts to address the vulnerabilities systematically. We know that breaches have occurred and will continue to occur until the industry is better equipped to be ahead of the attackers, not playing catch up. Right now we are interested in learning from these breaches and using intelligence garnered to get ahead of game. There is a lot to think about here. With all this in mind, I will end this part of my remarks with a reminder of what we see as the key components of any solution designed to address cybersecurity. It must: •  Be comprehensive, risk-based and threat-informed;  •  Be a joint effort between public and private sectors;  •  Be flexible enough to evolve as technology advances; –  Automated  –  Scalable  •  Support information sharing;  •  Leverage best practices;  6  BIS central bankers’ speeches  •  Include all in the industry – regardless of size or processes (internal systems or external providers); and  •  Delve deeper than one step below the surface. Conclusion We live in an ever-changing environment where speed and agility are of the essence.

We needed financial firms, and a financial system, that was better prepared to weather all storms. In 2011, we developed the Framework for Supervision – a framework designed to ensure we had firms and a system that were less complex, more resilient and better managed. Collectively, we have made a lot of progress since 2011 – and the industry is in much better condition relative to the pre-crisis period. But, as you all know, business does not stand still and this constant evolution results in new risks and new challenges. Before turning to one of the biggest risks or challenges I see, I want to pause and recognize two things: •  First, it’s clear that progress has been made across the industry in a number of areas – particularly in making firms and the system more resilient through improvements in capital and liquidity, as well as enhancements in risk management, including capital planning and stress testing across the range of risks firms face. But, in the remaining two areas of the Framework – less complex and better managed – I think it’s safe to say that despite the fact that firms are addressing a number of outstanding issues, these areas continue to present challenges in reaching the desired end state. •  Second, as I’m sure you would agree, we collectively still have quite a bit of work to do to fully implement all of the changes required under new rules and regulations.
If the local banks stay small and weaken over time, we will be worse off for it. In the longer term, stronger and larger local banks offer far better assurance of Singapore’s interests. MAS’ approach to consolidation While MAS welcomes the process of consolidation, it will remain strictly neutral, and will not seek to influence the outcome. We have made it known to all the participants that we will allow the local banks to bid for one another. The new configuration should be determined by the free play of the market. MAS will leave the banks and their shareholders to decide whom they should merge with or acquire, subject to five conditions being met: a. First, the banks should have the capability to achieve effective integration following the merger. The management of the acquiring bank must understand the financial, operational, and cultural issues involved in integrating two entities and have a credible plan in place. b. Second, the merger must not impair the bank's financial soundness. In particular, the bank must meet MAS’ capital adequacy requirements at all times. Consolidation should not compromise the safety and soundness of the bank. c.  Third, we will consider the impact of the merger on competition. Consolidation should not lead to the emergence of one or a small group of overly dominant banks, which are in a position to engage in monopolistic or other anti-competitive behaviour.

Australia, which is slightly bigger than the Netherlands, also has 4 big banks, but they are mainly domestic, smaller than the Dutch although bigger than the Singapore banks. The Australian government maintains a “Four Pillars” policy, under which it will not allow any of the 4 banks to merge or take over any of the others, in order to maintain sufficient competition in the domestic market. But there is debate in Australia over whether this “Four Pillars” policy is sustainable, or whether it will cause Australian banks to lose out in the long run, by preventing them from becoming large enough to be truly viable. Singapore’s economy is ¼ the size of Australia’s. Singapore cannot afford a “Four Pillars” policy. If we tried that, our banks would be like bonsai plants, root-bound by the small pots in which they grow. Our biggest bank – DBS, even after the merger with POSBank, is ranked only 115th in the world by asset size. In banking size is not everything, but size is important. If the local banks fail to achieve enough scale, they will not be able to invest in cutting-edge technology and management systems, or to attract the talent necessary to compete with the best players. Their service standards and product range will not be able to keep up with their foreign competitors. They will find it difficult to diversify their earnings by competing in fee-based businesses, like asset management and cash management.
There are three elements which appear to be underpinning these concerns about the sustainability of growth in the current economic climate: the prospects for the global economy; the prospective impact of the government’s fiscal tightening; and the legacy of the financial crisis. I will discuss these three issues in turn before coming back to the crucial issue of how the Bank of England’s monetary policy can best support the recovery. The global economic outlook A serious setback for the global economy would have major repercussions for the growth of the UK economy. Our economy has a very international focus, and exports, international business activity and the financial sector all play a part in creating strong linkages from the UK to other major economies elsewhere in the world. The sharp drop in business and financial sentiment across international markets in late 2008 and early 2009 – and the ensuing downturn in the global economy – played a major part in tipping the UK into recession two years ago. Similarly, the rebound in the global economy has helped to support our recovery over the last year or so. However, a serious downturn in global growth does not seem very likely at the moment. According to the IMF, global growth this year is now projected to be nearly 5%, compared to a projected growth rate of less than 2% just eighteen months ago.

Zeti Akhtar Aziz: South East Asia – potential and perspectives in the New Asia Luncheon address by Dr Zeti Akhtar Aziz, Governor of the Central Bank of Malaysia, at the 2010 Institute of International Finance (IIF) Annual Membership Meeting, Washington DC, 8 October 2010. *  *  *  Generating growth and a long lasting recovery is the primary priority for the global economy in this aftermath of the recent crisis. The massive life support that was provided to avert a deep recession was to be temporary – to provide the opportunity to address the weakness in the system and to rebuild the capacity for a self-sustaining recovery. Recent indications are that this prospect has not been realised. The emerging world has however performed well with the potential to generate such a sustained recovery. These developments have drawn significant interest to the Asian emerging economies and on their changing role in the global economy and in the international financial system. It is my honour and great pleasure to speak at this 2010 Institute of International Finance Annual Membership Meeting. My remarks today will focus on the challenges in managing such a sustained recovery with specific focus on the potential for emerging Asia to rise to these challenges in this new global economic and financial environment. The final part of my remarks will be on the changes taking place in the international financial environment from the perspective of emerging Asia.
Private sector pay growth (again excluding bonuses) has been grinding through the gears; it recently hit the psychologically-important 3% barrier. Private sector wage settlements so far this year are running at 2.8% and in some sectors, such as construction and IT, are running well in excess of 3%. The public sector has, for a number of years, been held to a 1% pay cap. This had the effect of suppressing whole-economy pay growth, both directly (given the public sector comprises around 18% of total employment) and potentially indirectly (due to the possible spill-over effects of public pay awards on the private sector). That public sector pay cap has now been lifted and decisively so. Earlier this year, over 1 million NHS workers received a one-year pay settlement of at least 3%. Some workers have received double-digit pay rises. They have been joined recently by a further 1 million workers from the armed forces, police and teachers, who have secured pay rises of between 2-3.5%. The largest segment of public sector workers – including those in Local Authorities – have yet to settle. But with the cap breached, it seems possible their pay settlements could also ratchet upwards. We can see that upward ratchet in pay in the distribution of pay settlements (Chart 24). According to the Bank’s comprehensive wage settlements database, so far this year around 65% of deals have been struck at rates above their level the previous year. The largest contributor to this rightwards shift in the settlements distribution has been the public sector.

And I learned with time that the former got more from the bank because I and it knew more about them and what they needed – whether a savings product or a loan. The bank got more from them in terms of revenue and reliability (helpful given that two small banks had recently failed). Indeed, as my province was in a deep recession at the time, loyalty and understanding mattered. It could mean the difference between a restructured loan that could be repaid and a foreclosure that would bring liquidation. In short, I was at the front line of a banking value chain – one that is now being impacted across its components by FinTech. Traditional universal banks combine the customer relationship, retail and commercial deposits and lending, and a wide range of activities in wholesale money and capital markets. 2  The FSB defines FinTech as technologically-enabled financial innovation that could result in new business models, applications, processes or products with an associated material effect on financial markets and institutions and the provision of financial services. 4  All speeches are available online at www.bankofengland.co.uk/speeches  4  Diagram A: Financial Services Value Chain  Payment services traditionally relied on cash, debit and credit cards, and wire transfers. Now FinTech companies are providing domestic and cross-border payment services on significant scale through “digital wallets” or pre-funded “eMoney”. Tech firms take a slice of payment revenues and, in many cases, the totality of customer transaction data.
8  BIS central bankers’ speeches  Figure 3  Commodity prices (1) (2)  (index, May 2010- June 2011=100)  (monthly index, 2006=100)  140  140 250  250  120  120  200  200  150  150  100  100  50  50  0  0  100  100  80  80  60  60  jun.10 oct.10 Feb.11 feb.11 Jun.11 jun.11 Jun.10 Oct.10  Energy  Metals  06 07 08 09 10 11 11(f)12(f)  Copper  Grains & cereals  Oil  Foodstuffs, FAO  (1) Left chart shows indexes of aggregated S&P GSCI. (2) Right chart uses data up to May 2011 for foodstuffs, up to June for oil and copper. (f) Dots indicate average prices forecast for 2011 and 2012 in June 2011's Monetary Policy Report. Sources: Central Bank of Chile and Bloomberg. Figure 4 Actual and expected monetary policy rate in the world (1) (percent) 24  24  20  20  16  16  12  12  8  8  4  4  0  0 97  99  01  Developed economies (2)  03  05  07  09  Emerging economies (3)  11 Chile (4)  (1) Solid lines show simple average of reference rates of each group of countries.

14  BIS central bankers’ speeches  Figure 14 Gross capital inflows and outflows (1) (percentage of GDP) Chile (2)  Emerging economies (3)  20  20  8  8  15  15  6  6  10  10  5  5  4  4  0  0  2  2  -5  -5  0  0  -10  -10  -2  -2  -15  -15 -4  -4  -20  -20 -6  -6  90  94  98  02  06  90  10  94  98  02  06  10  Gross portfolio inflows & debt Net flows  Gross inflows  Gross portfolio inflows and debt  (1) Annual flows. (2) 2011 figures show annual flows accumulated up to first quarter. (3) Simple average of: Brazil, Colombia, Indonesia, Malaysia, Mexico, Peru, the Philippines, South Korea, Thailand and Turkey. 2010 figures show annual flows accumulated up to third quarter 2010. Sources: Central Bank of Chile and International Monetary Fund. Figure 15 Currency mismatches (1) (2) (percentage of total assets) 6  6  3  3  0  0  -3  -3  -6  -6  06.IV  07.II  07.IV  08.II  Tradable  08.IV  09.II  09.IV  Non tradable  Total  10.II  10.IV  (1) Liabilities in dollars minus assets in dollars, minus net derivatives position.
There may be some early indications that such a shift has begun to occur with prices rising faster outside metropolitan areas. As of March this year, annual house price growth has been in the 13-14% range for the North of England and the 10-12% range for the Midlands, Wales and Scotland, with London the laggard at just under 4%. But even if it has begun, is far too early to say whether or not it will be sustained. Preferences expressed during the pandemic and lockdown may not be a good guide to post-pandemic behaviour. If it occurred, such a shift would reverse decades of movement in the other direction and might see closing of the gap between London and other high cost areas. It is not clear what impact a more buoyant housing market along these lines would have on prices, mortgage indebtedness distribution of housing wealth. Even if prices rise in newly popular locations and the volume of mortgage transactions increased, there could be offsetting effects. First-time buyers of properties outside high cost metropolitan areas who would otherwise have bought in those areas would take on less debt than they would otherwise have done. And existing owner-occupiers who moved from such areas to other areas in the UK might in fact reduce their debt in doing so. Supply may also be more able to respond to demand outside city centres.

These changes are mutually reinforcing and will meaningfully improve our ability to achieve both of our dual mandate goals in an environment of a very low neutral rate. I’ll conclude with this: The new framework represents both an important evolution in our thinking about how to achieve our goals and another step toward greater transparency. It reaffirms key aspects of the original statement that have stood the test of time and refines others in line with experience and evolving practices. It also makes some more significant changes in light of developments and lessons learned in recent years. And most importantly, it positions us for success in achieving our maximum employment and price stability goals in the future. 1 See Board of Governors of the Federal Reserve System, Statement on Longer-Run Goals and Monetary Policy  Strategy, as amended effective August 27, 2020. 2 Longer-run forecasts of interest rates can be found in Blue Chip Financial Forecasts (Wolters Kluwer). For the  decline these forecasts over this period, see the June 2012 and June 2020 issues. 3 See John C. Williams, Three Questions on R-Star, FRBSF Economic Letter, 2017–05 (February 21, 2017), for a  discussion of the decline in the natural rate of interest. Estimates of the natural rate for the United States, Canada, the United Kingdom, and the euro area are available at Federal Reserve Bank of New York, Measuring the Natural Rate of Interest.
As the directives produced by the EU are often compromises between views expressed by different countries, it is not certain that the final result will be the most efficient solution for the securities markets. If the EU wants to promote competitive economies, it must also ensure that this does not result in a competitive advantage based on more or less explicit subsidies. The best way to build up competitiveness is by creating environments for competition. It is only then that the economies will become efficient. Competitiveness in itself is not the goal; efficiency is. Some issues for the future In this speech I have pointed out some long-term developments that affect the future of the securities markets. Unfortunately, they give rise to more questions than answers. I would like to conclude with a few questions you can ponder. In recent years, inflation in many countries has fallen, and inflation expectations have stabilised at a level that reflects the monetary policy targets. This can reasonably be said to have reduced the uncertainty in the financial markets caused by fluctuating prices. Interest rates have also fallen and this, combined with reduced uncertainty over price trends, has increased households’ incentives for borrowing. It has affected house prices, but may also affect other asset prices. At the same time, it strengthens institutional investors’ search for yield. Does this mean that the risks in the financial system will increase and make it easier for exaggerated speculation, such as the IT bubble in the stock market, to develop?

A natural question in this context is why these driving forces and regulations are of interest to the Riksbank. The Riksbank has two statutory tasks, to maintain price stability and to promote a stable and efficient payment system. Both of these tasks give us reason to take an interest in the securities markets. To begin with, it is evident that the Riksbank’s monetary policy requires an efficient fixed income market so that inflation will be affected by interest rate decisions. With regard to the payment system, the securities markets are becoming increasingly important to the banks, which in turn are central to the functioning of the payment system. In addition, large parts of the securities market infrastructure are directly linked to the payment system in different ways. The Riksbank therefore has every reason to monitor developments in the securities markets and to actively promote the development of regulations that contribute to stability as well as efficiency. Demographic changes One of the fundamental economic driving forces behind developments in the securities markets is demographic changes. The age distribution of the population sets the framework for savings. It is not too far-fetched to assume that people mostly borrow while they are young, save while middle-aged and then live off their savings when they are older. Savings vary over a life cycle. Studies show that household debt is mainly built up during the ages 20 to 40; while people aged 40 to 65 have positive  BIS Review 66/2004  1  net savings.
We need to develop a clearer presumptive framework of this kind – no doubt with provision for exceptions where they could be properly justified – before the next crisis hits us, because what debtor countries and their private sector creditors believe they can expect will influence their behaviour in the meantime. BIS Review 36/2001  5  What we all have to recognise is that the exceptional amounts of official funding committed during the Asian crisis are far less likely to be forthcoming in future. And to the extent that official funding is forthcoming, conditions may well be attached to ensure that it is not used simply to re-finance payments of short-term debt to private sector creditors or to fund a resident capital outlflow. Several of the tools which the G7 communiqué identified are designed to have precisely this effect. The last thing that the official international community wants is to get dragged into the micromanagement of relations between debtor countries and their creditors. We would all agree on the desirability of voluntary solutions, which might be easier to achieve if borrowing countries and their major creditors – above all the short-term lenders – were to establish, during the good times but on an on-going basis, arrangements for regular dialogue. Nor would anyone want to insist upon the imposition of constraints on capital outflows.

The international presumption in favour of free markets in itself is somewhat remarkable, given that, at the micro-economic level, increased competition invariably constitutes a threat to established producers – and their employees – who might well be tempted to urge protection in one form or another on their national governments. Consumers, who benefit from such competition, tend to be less vocal or well organised. The threat of protectionism is never, therefore, far away. But in fact the presumption in favour of competition has proved encouragingly robust. And that is not just in relation to international trade. There is a parallel presumption in favour of freedom of capital movements, and much greater openness around the world to foreign investment. Among other things on the supply-side, there is a shared emphasis on the need to direct public spending to developing human resources through education and training, to effective health care, and affordable social safety nets. There has been a global trend to privatisation through which governments have increasingly returned essentially commercial activities, in which they have no necessary comparative advantage, to market disciplines. And there is a common recognition of the need for reforms in labour and product markets designed to reduce distortions which impede the efficient allocation of resources. Now I do not pretend to you, Mr Chairman, that the international policy consensus in favour of macroeconomic stability and supply-side reform is fully articulated, particularly on the supply side; nor do I claim that it is subscribed to in its detail equally in every IMF member country.