samchain/econo-pairs-v1 huggingface dataset:
This increase in financial institution resilience has not been achieved at the expense of economic activity. This brings me to the crux of the question put to me by your Academy today. First, the objective of the regulators was clearly to limit the potential adverse effects of their reforms on the real economy, and to ensure that financial activities support growth and economic development. In 2010, before the roll-out of Basel III, major work was carried out12 to measure the impact of these reforms. The Basel Committee’s Macroeconomic Assessment Group concluded, from a broad range of estimates, that for every 1 percentage point rise in the target capital ratio, the cost of credit would increase by an average of around 0.15 percentage point. Yet in practice, this credit tightening never materialised. The favourable effects of the fall in interest 3/7  BIS central bankers' speeches  rates under the accommodative monetary policy stance have far outweighed any negative consequences of stricter regulatory requirements. Today in Europe, as in France, the flow of bank lending to businesses and households remains robust. Indeed, the strength in private sector lending is even the focus of particular vigilance in France and on the part of the HCSF. In September 2017, growth in bank lending to households and businesses reached 5.7% and 5.4% respectively in France, twice the rates observed in the euro area as a whole. Since the start of 2010, the cumulative growth in both forms of lending (29%) is almost twice that of nominal GDP.

Thorsten Beck, Tao Chen, Chen Lin and Frank M. Song (2016), “Financial innovation: the Bright and the Dark Sides”, Journal of Banking and Finance, 72, pp. 28– 51. 3 See, notably, Ross Levine, Norman Loayza, Thorsten Beck, “Financial intermediation and growth: Causality and  cause”, Journal of Monetary Economics, Volume 46, Issue 1, August 2000, pp. 31–77 and Thorsten Beck, Ross Levine, Norman Loayza, Finance and the sources of growth, Journal of Financial Economics, Volume 58, Issues 1-2, 2000, Pages 261–300. 4 Carmen Reinhart and Kenneth S. Rogoff, “The aftermath of financial crises”, American Economic Review 99,  No. 2, 2009, pp. 466–472. Moritz Schularick and Alan M. Taylor (2012), “Credit Booms Gone Bust: Monetary Policy, Leverage Cycles and Financial Crises, 1870–2008”, American Economic Review, 102 (2): pp. 1029– 1061. Thomas Philippon and Ariell Reshef (2013), “An International Look at Growth of Modern Finance”, Journal of economic perspectives, 27, pp. 73–96. Stephen Cecchetti and Enisse Kharroubi (2015), “Why does financial sector growth crowd out real economic growth”, BIS working papers, 490. 5 Jack Guttentag and Richard Herring, “Disaster myopia in international banking", Essays in International  Finance, No. 164, 1986. 6 See notably Jean-Louis Arcand, Enrico Berkes and Ugo Panizza, “Too Much Finance? ", Journal of Economic  Growth 20, 2015, p. 105–148. 7 Private non-financial sector debt as share of GDP, Q1 2017. Sources: Eurostat data, Federal Reserve, Banque  de France calculations. 8 Luc Laeven and Fabian Valencia, “Systemic banking crises database", IMF Economic Review, Vol.61, No.
This can be regarded as an estimate of long-run sustainable unemployment up to 2006, before the government’s reforms. However, the estimate disregards the fact that average inflation has undershot average inflation expectations. As I explain in an annex to the minutes from the meeting in July 2012 (Svensson (2012a)), this difference between inflation and inflation expectations means that average unemployment becomes a biased estimate of the long-run sustainable rate of unemployment. When I take this difference into account, I reach the conclusion that the bias is approximately 0.75 percentage points. All else being equal, the Riksbank’s estimate should then be reduced by 0.75 percentage points, whereby the Riksbank’s final interval after the adjustment will be 4.25–6.75 per cent, with a midpoint of 5.5 per cent. The estimates made by the Ministry of Finance and the National Institute of Economic Research do not take into account the fact that average inflation has been lower than inflation expectations, either, so their estimates may also need to be adjusted downwards  BIS central bankers’ speeches  7  somewhat. The average of the Ministry of Finance’s and the National Institute of Economic Research’s estimates so far and of the Riksbank’s estimate after my adjustment is in any case be 5.5 per cent. While awaiting new estimates that take into account the bias that average inflation lower than average inflation expectations entails, I will use 5.5 per cent as my own assessment of long-run sustainable unemployment.

Unemployment and annual CPI inflation 1976–2012 and the long-run Phillips curve 1997–2011 16  16 Unemployment and annual CPI-inflation 1976-1997 Unemployment and annual CPI-inflation 1998-2012 Long-run Phillips curve 1997-2011  CPI-inflation, annual percentage change  14 12  14 12  1976  10  10  8  8  1991Q4  6  6 1993Q4  4  4  2011Q3  2  2  1998Q1  0  0  -2  -2 1  2  3  4  5  6  7  Unemployment, per cent  8  9  10  11  12  Note. Annual inflation from 1998 Q1 and onwards (in red) is a moving average of four quarters’ quarterly inflation, that is of quarterly inflation 1997 Q1 and onwards. The long-run Phillips curve is in Svensson (2012d) estimated with quarterly inflation in the period 1997–2011. The dashed horizontal line corresponds to an average CPI inflation of 1.4 per cent. Sources: Statistics Sweden and own calculations. 14  BIS central bankers’ speeches
And given the lack of momentum from private and public sectors, U.S. growth will likely remain low for an extended period of time. While economic data releases have pointed time and again to delayed consumption spending and persistently high unemployment, available fiscal and monetary policy space seems to be quite limited. On the fiscal side, further stimulus will be constrained by the promised cuts in federal spending that accompany the recent raise of the U.S. debt ceiling. On the other hand, the Fed’s commitment to maintain the federal funds rate “exceptionally low” at least through mid-2013 should remind us that, in order to be even more accommodative, the Fed might need to rethink and come up with some creative policy actions – probably something that is much more creative than the recent “Operation Twist” that seems to disappoint many market participants. The fact that the U.S. government and the Fed are running out of traditional policy “bullets” leaves one only to wonder what the government and the Fed will do in the face of future shocks. And if they eventually resort to “creative” policy actions, the implications of their policies on the global economy can be quite unpredictable. Across the Atlantic, the Eurozone is also struggling with their sovereign debt crisis, which only deepens and intensifies as time passes. Over the past few months, we have seen some Eurozone member countries that are unwilling to collaborate fully, let alone going the extra mile, to get the problems solved.

We have also seen Germany under tremendous pressure both at home and abroad with regard to its role in solving the crisis. Moreover, the future of Greece, where it all started, also remains unclear. We have seen various attempts in engineering debt restructuring for Greece, even an “orderly default”; and in late October we have seen agreement between Eurozone leaders and banks on Greek debt’s haircut. Personally, I am concerned that many of these steps are merely “technical” solutions that do not address the situation at its root causes, and only time will tell how these “technical” steps would play out as well as what the eventual fate of Greece in the European Union would be. Looking beyond Greece, some contagion of the sovereign debt crisis to the financial sector and the real economy of other European countries and beyond seem to be inevitable at this point, with countries that are “too big to bail” such as Italy also on the list. Private holders of PIIGS bonds face substantially higher risks, which have already led to recent downgrades of several financial institutions. Without decisive actions and unreserved collaboration in solving the debt crisis, the outlook for Eurozone economy is likely to be affected – given the possibility of further fiscal consolidation in countries like Italy, Spain, and even France. Ladies and Gentlemen, I would like to restate that what happens on both sides of the Atlantic will likely shape the global economy over the years to come.
i  Lagarde, C., Challenges along Europe’s road, speech, 11 May 2022 Villeroy de Galhau, F., The Eurosystem and its monetary policy: from an “impossible dilemma” to a possible roadmap for normalisation, speech, 6 May 2022 iii QJE paper by Fahri and Maggiori (2018) iv See the Council conclusions on achieving the EU’s economic and financial strategic autonomy in an open economy: one year after the Commission’s Communication. v Villeroy de Galhau, F., Capital Markets Union: unleashing Europe’s potential, speech, 30 November 2021 vi ECB report on RIE : only 60% of extra-euro area exports of goods were invoiced in euro in 2020 vii Recent research by Amiti, Itskhoki and Konings (2020) viii See the document Trade and investments in energy in the context of the EU common commercial policy ix Quote available here https://www.imf.org/external/np/exr/center/mm/eng/mm_sc_03.htm ii

Mario Draghi: Hearing at the Committee on Economic and Monetary Affairs of the European Parliament Introductory statement by Mr Mario Draghi, President of the European Central Bank, for the Hearing at the Committee on Economic and Monetary Affairs of the European Parliament, Strasbourg, 14 July 2014. *  *  *  Mr Chairman, Honourable Members, Allow me to start by congratulating all of you on your election to this House, and you, Mr Chairman, on your appointment as Chair of the committee in the new legislative period. The architects of Monetary Union conceived the ECB as a central bank with a clear mandate and with strong provisions for its independence. But for a public institution in a democratic society, independence can never come without being commensurately transparent and accountable to the elected representatives of the people. Our regular exchanges of views are a key channel for the ECB to discharge its duty of central bank accountability; hence, they plays an essential role in providing the ECB with the necessary legitimacy to fulfil the tasks assigned to it by the Treaties. To underscore our commitment to transparency, the ECB has recently decided to go a step further by publishing regular accounts of the monetary policy meetings of the Governing Council, which is intended to start in January next year. It is in this spirit that I am looking forward to our exchange of views over the next five years.
However, broad  policy analysis system, which brings  money (M2b) will remain as the key  together information and judgment in a  indicative intermediate variable, which  coherent and logical manner. reflects the broad liquidity conditions in the economy, to guide the conduct of monetary policy of the Central Bank. Under the FPAS, the Central Bank has already finalised the development of the baseline version of a semi-structural  To implement the new framework,  Quarterly Projection Model (QPM) for  macroeconomic projections, including  forecasting and analysing monetary  inflation projections, are currently being  policy. strengthened using short-term as well as medium-term structural forecasting tools and techniques. In this endeavour, continued efforts are being made to  Central Bank of Sri Lanka – ROAD MAP 2017  Meanwhile, the Central Bank is in the process of implementing several organisational changes necessary for the  13  effective implementation of the model. Moreover, we also intend to reintroduce  To this end, a separate Modelling and  the Monetary Policy Consultative  Forecasting Division has been setup in  Committee (MPCC) in 2017, comprising  the Economic Research Department and  eminent academics, professionals as  relevant processes are being developed  well as representatives from the private  while equipping the staff with adequate  sector. We expect to benefit from the  training. views and inputs of the MPCC in better  More importantly, we intend to introduce several changes in the  calibrating the monetary policy decision making process.

There was a similar experience in 2015 when the currency depreciated by 6.5 per cent after spending US dollars 2.1 billion of our reserves. Wasting large amounts of  5  3 August, Thursday  the country’s external reserves, much of  6  26 September, Tuesday  it borrowed, in a vain effort to defend  7  7 November, Tuesday  8  28 December, Thursday  the currency, which has to be ultimately depreciated anyway, is clearly unsustainable. It is time to stop this pattern and commence building up of external reserves through sustainable  Volatile global market conditions and Sri  foreign exchange inflows. Lanka’s vulnerability as a twin deficit country underscore the vital importance  The impact of global developments,  of having a flexible exchange rate policy  such as Brexit, recent Presidential  to adjust to external pressures. Recent  elections in the United States (US) as  experience has clearly demonstrated  well as interest rate hikes by the US  that it is unsustainable to maintain an  Federal Reserve, the forthcoming  overvalued exchange rate at the  elections in France and Germany in  expense of external reserves.
This is costly and no business can be profitable in the medium to long term without proper networks in their business lines. Net working is about creating a set of contacts and subsequently building a trusting and genuine relationship with these people. Networking provides the opportunity to discover people who may be able to offer assistance to one’s business and who may also benefit from the assistance that one has to offer. In this global economy, millions of transactions are made on a daily basis across borders, regions and continents. For these transactions to be cost effective and profitable there is need to remove information asymmetries and to reduce the risk of moral hazard. These significant impediments can greatly be avoided by counting on the contacts that one may  BIS Review 150/2008  1  have in a different country region or continent. The end product would thus be increase in economic welfare for all. Your Excellency, at a country level, Zambia still requires significant levels of investment in many sectors of the economy to achieve desirable levels of growth. The country possesses abundant natural resources and human capital. It is also surrounded with eight neighbouring countries and close proximity to the large market of South Africa, a surface area of over 750,000 sq km, and an approximate population of over 11 million people. Its active participation in the SADC Trade Protocol and the COMESA/FTA offers preferential tariff access to market potential of about 380 million plus people.

I enjoy interacting with people whom I have a common interest and even those who have different views on several issues. In closing, let me reiterate that I have no doubt that the Alumniportal Deuschland will enable alumni to tap into an invaluable source of skills, vast experience and necessary expertise in many areas of development. It will link people beyond professional and cultural boundaries and organisational sectors meaning that it will act as a catalyst for rapid and continuous success. In a global world, success can only be guaranteed from long term cooperation and constant interactions with business partners and friends. Let us build our potential through the Alumniportal and in effect add to our own successes. I thank you. 2  BIS Review 150/2008
In 1999 Professor Nancy Cartwright, a philosopher of science, published a book with the title The Dappled World: A Study of the Boundaries of Science (Cartwright (1999)). This quote captures its essence: “Science as we know it is apportioned into disciplines, apparently arbitrarily grown up; governing different sets of properties at different levels of abstraction; pockets of great precision; large parcels of qualitative maxims resisting precise formulation; erratic overlaps; here and there, once in a while, corners line up but mostly ragged edges; and always the cover of law just loosely attracted to the jumbled world of material things.”  Cartwright was describing the natural sciences. She describes them as a patchwork of theory and evidence, some of it precisely cut, most of it haphazardly shaped and pieced together irregularly. And there is, she argues, no shame in that. To the contrary, it may be the best science can do, given limited knowledge and limited time, in trying to make sense of an often-jumbled world. Here is another way of putting Cartwright’s point. Sometimes the popular perception of the natural sciences, and physics in particular, is that it too is a methodological monoculture. The defining characteristics of this monoculture are great laws and unifying theories. For example, it is perhaps no accident that the world’s 2  most famous equation is this one: E= MC . Not only is this uniquely famous equation drawn from theoretical physics; it defines a great law, a unifying theory.

In general, a system comprising three bodies undergoing motion via a force cannot be solved analytically – the “three-body problem”. And there are many problems in physics which involve the interaction of “particles” in ways which are complex and non-deterministic. 13  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  13  These features have resulted in ABMs being extremely widely used in the physical sciences, at various different levels of resolution. At the micro scale, some of the earliest applications of ABMs were to study plasmas – charged particles which constantly interact. Plasmas are the fourth state of matter after solids, liquids and gases. They are prime ABM candidates because they exhibit rich, non-linear, complex behaviour. In 1966, Edward Teller wrote a paper which described how to build a plasma ABM with 32 interacting particles (Brush, Sahlin and Teller (1966)). Even with “only” 32 interacting agents, this was a formidable computational challenge. But the advent of parallel and high performance computing since the 1990s has changed the scale of plasma particle simulations. Simulations today regularly use as many as 10  9  computational agents (Turrell et al (2015)). These plasma ABMs have found widespread application, micro and macro. At the micro level, they have been used to help identify and kill cancer cells with pinpoint accuracy, while leaving healthy surrounding cells unharmed (Bulanov et al (2002)).
It is important to stress the complex interdependence at the core of the entire mechanism, in which an individual investor’s strategy depends not only – as in the standard efficient markets’ paradigm – on the discrepancy between the market price and the fundamental price, but also, and crucially, on what other agents are doing. And as is well known, such interdependencies can give rise to markedly sub-optimal outcomes, with the Prisoner’s Dilemma being the simplest and best-known. A second rationale for the “mopping up” position was that even if the central bank were able to identify an asset price bubble in real time, monetary policy is simply too blunt an instrument to try to deflate it, especially because bubbles typically affect only a subset of asset markets, whereas monetary policy exerts its impact on the overall economy. This implies that a central bank that wanted to deflate a bubble in (for example) the housing market would risk pushing the economy into a recession. Further, it has been argued that such a risk of “overkilling” is especially serious because, given the very nature of asset bubble dynamics, and the sizeable capital gains typically accruing to those who are “riding” them, the standard interest rate increase of 25, or even 50 basis point would most likely just be shrugged off. To put it differently, a central bank that truly wanted to deflate a bubble should be willing to run the risk of inflicting serious damage on the economy, by hiking interest rates by significant amounts.

This logically implies that an exclusive focus on the two-year ahead central inflation projection will cause policymakers to miss the risk of undershooting the inflation objective sometime in the future, possibly by a non-negligible amount. In turn, this implies that the central projection for inflation does not represent a sufficient statistic for monetary policy, and that a more sophisticated approach, factoring in the possibility of “tail risks” such as the bursting of a bubble, should be taken into account. A possible way of addressing the problem  9  See Dubecq et al. (2010). 10  See Reinhart and Rogoff (2009). 6  BIS central bankers’ speeches  within the traditional forecast-based framework which has been dominant among inflationtargeting central banks is to extend the forecast horizon beyond two years ahead. The risks to the central inflation projection deriving, say, from excessive credit growth and the resulting build-up of an asset price bubble would then be encoded in the probability distribution for inflation at longer horizons. This would allow the central bank to meaningfully discuss the dangers associated with such a build-up, and – assuming that within future policy frameworks monetary authorities will be endowed with macro-prudential instruments – it will allow them to explain to the public the adoption of measures designed to curb credit growth.