samchain/econo-pairs-v1 huggingface dataset:
These conclusions reinforce the findings of the papers presented in Session 1, which I have discussed before, that the Baltic states and the South-East European economies have probably already reached or even overshot the equilibrium level of credit to GDP. The paper prepared by IMF economists, in turn, addresses the issue of sustainability by focusing on capital flows. Within a dynamic stochastic general equilibrium model, it analyses the short- and mid-term risks arising from the opening up to capital flows and alleviating of credit constraints for the case of a small converging economy. Both papers prepared by economists from international financial institutions and presented in Session 6 offer recommendations for policymakers in such economies, which can reduce vulnerabilities and risks in the face of rapid credit growth. Under such circumstances, it is crucial that macroeconomic policies do not add to the existing demand pressures – tightening fiscal policies is often a must-do – and that steps are taken to strengthen the health of the financial system. This can be achieved by tightening regulatory measures, raising prudential standards and enhancing supervisory coordination and cooperation, as well as by supporting a better understanding of financial risks by the general public, e.g. by means of public awareness campaigns.

But there is more to be done, and it is a long-term project. It is also necessary to drive home the point that bank directors’ role is not only to maximise short-term profits; as the system is currently structured, bank directors are also guardians of public goods as represented by joint financial market infrastructure. The third is financial literacy. A number of studies show that increased financial literacy enhances financial market stability, monetary policy transmission, and understanding of monetary policy actions. This is why the Central Bank has participated in and supported the preparation and implementation of Financial Literacy Week in recent years and intends to continue doing so. It so happens that Financial Literacy Week is underway right now. The fourth topic is discussion of what type of financial system we need and want as we emerge from the aftermath of the financial crisis. That includes the international aspect of the system, the scope of the system, and whether we need to shelter our infrastructure even more from risk-taking than we have already done with recent and planned reforms, including forthcoming legislation on insolvency and winding-up of financial institutions. In this context, there are other options available than the complete separation of commercial banking from investment banking. After important steps concerning capital account liberalisation are complete, which will be soon, there will be opportunities to say more about these topics and others. And now I have come to the conclusion of my speech today.
In my remarks of a year ago, I mentioned that we are at a period of historic transition with regard to the development of the offshore RMB market. Looking at the development of the Eurodollar and offshore RMB markets side-by-side, as we just did, gives us a unique perspective on how things might play out in the long run. Indeed, as the offshore RMB market reaches maturity, there will no doubt be volumes of literature written by financial historians that compare the birth and development of these two markets. While developments so far have been encouraging, we are still at the initial phase of RMB offshore market development. The policy headroom to develop RMB business is already present, and we at the HKMA will continue to provide a safe and efficient financial infrastructure for the conduct of RMB offshore activities. But the most important of all, I would encourage businesses and financial institutions to make full use of such opportunities already available and promote the development of a wide range of RMB services and financial products. Forums like this one help us prepare for the future by examining what has transpired, making comparisons and exploring business opportunities and collaborative initiatives. I am eager to work together with all of you in shaping what is to come. Thank you. 4  BIS central bankers’ speeches

With their technical support, the Government, through the Balance of Payments Statistical Committee, comprising representatives from the Ministry of Commerce, Trade and Industry, Ministry of Tourism and Natural Resources, Zambia Development Agency, Central Statistical Office and Bank of Zambia, was able to undertake this very important survey. Distinguished Participants, As you are aware, the Zambian economy has recorded significant positive developments in the recent past, owing to the economic reforms the Government has been implementing since 1992. These reforms have facilitated foreign investments in various sectors of the economy. These reforms have also resulted in Zambia recording tremendous improvement in world ranking with regard to the ease of doing business. The favourable investment climate created has raised investor confidence in the Zambian economy thereby attracting both local and foreign investments. Ladies and Gentlemen, the survey findings we are disseminating today show that the overall Foreign Private Investment inflows in 2009, declined to US $ million from US $ million recorded in 2007. This was explained mainly by the notable reduction in re-invested earnings, due to lower profits recorded by enterprises during the year. The overall reduction in foreign investment inflows is also consistent with global developments. In fact, at a global level, foreign direct Investment inflows drastically declined to US $ billion in 2009 from US $ billion in 2008 and US $ billion in 2007. Nonetheless, new equity investment inflows in Zambia surged to US $ million in 2009 from US $ million recorded in 2007.
This is why French law imposes on banks to provide a specific offer for these clients, comprising minimal services with reduced fees of 3 euros per month. To follow up on the implementation of this provision, an Observatory for Banking Inclusion was created in France. Chaired by the Governor of Banque de France, it brings together public authorities, NGOs and banks and has proved to be a very helpful forum. A second example is the “Mediator of Credit” function. Led by an official of Banque de France, it is aimed at small businesses and it relies on the operational support of the local branches of Banque de France. Its objective is to help entrepreneurs who have been refused a loan by providing mediation with their banks and creditors to overcome these financing difficulties. 20.000 successful mediations have taken place since the creation of that function in 2008. This mediation function does not just provide financing: it also reduce the risk of bankruptcy for the companies which benefit from it. Another contribution of Banque de France to improving acces for fragile populations takes the form of support to assisted microcredit activities. Banque de France is a strong supporter of these activities through funding of a credit guarantee fund (5 million euros in 2018) and the development of a local networks of correspondents. To help preventing inequalities of treatment, Banque de France is involved in preventing and addressing household over-indebtedness issues.

Denis Beau: Financial inclusion in the digital age - how to make a difference? Panel opening talk by Mr Denis Beau, First Deputy Governor of the Bank of France, at the Singapore Fintech Festival 2019, Singapore, 13 November 2019. * * * Good afternoon Ladies and Gentlemen, I am very happy to be here with you today to introduce this session on financial inclusion and I would like to thank the MAS for offering me the opportunity to contribute to this conference. Inclusion is an essential topic for the financial sector, and more broadly for society as a whole. It’s essential because it’s about making sure everyone can have access to financial services. Because without this access, there is no or only limited ways for people to take part in the formal economy, to build up capital, to buy goods and services, to develop an entrepreneurial project. It is essential because it’s not just about more growth for the financial sector or  even for the economy as a whole, it’s also about reducing inequalities and making sure that more fragile populations,households and businesses, are not left out of economic development. Of course, Fintechs have a huge role to play in financial inclusion. They can provide new solutions, but they also raise new challenges, with new players entering the financial world and new ways of looking at customer relationships.
4  BIS central bankers’ speeches  An important function of financial firms is to provide liquidity to the market. However, this exposes financial firms to run risk. Liquidity runs can be an accelerant to asset fire sales that can lead to downward price spirals where firms must sell assets to raise funds, with these sales putting more downward pressure on asset prices, leading to a renewed round of asset sales. For solvent financial firms, protection against liquidity runs requires liquidity buffers and/or access to appropriately collateralized central bank liquidity support. Financial firms on their own would likely choose to hold liquidity buffers that are smaller than socially optimal since these firms do not internalize the positive market externality that these liquidity buffers provide. As a consequence, liquidity regulation is necessary to achieve the desired level of firms’ liquidity buffers. Liquidity buffer requirements are also needed to reduce the dependence of these firms on central bank lender-of-last-resort (LOLR) support. There are several reasons this is desirable. First, access to central bank liquidity can lead to moral hazard with respect to the behavior of financial firms. This can be mitigated by requiring that firms with access to LOLR support hold sufficient liquidity buffers that must be used ahead of any central bank liquidity – the equivalent of liquidity “skin-in-the game.” Second, the line between illiquidity and insolvency often can become blurred, especially when markets are under stress.

William C Dudley: Global financial stability – the road ahead Remarks by Mr William C Dudley, President and Chief Executive Officer of the Federal Reserve Bank of New York, at the Tenth Asia-Pacific High Level Meeting on Banking Supervision, Auckland, New Zealand, 26 February 2014. *  *  *  It is a pleasure to have the opportunity to speak here today. This is my first time in New Zealand (not counting a brief stop at the Auckland airport). I’m delighted to be here and am heading down to the South Island tomorrow. Today, I am going to talk about the challenges that face us in ensuring stability in the global financial system. While we have made considerable progress in strengthening the financial system – for example, large global banks have considerably more capital and liquidity resources than prior to the financial crisis – there is still a significant amount of hard work ahead for all of us. For example, we need to develop resolution mechanisms that will work on a global basis and we need to ensure that the clearing of standardized over-the-counter (OTC) derivatives through central counterparties (CCPs) is done safely. We also need to improve our ability to aggregate and share data. We need to do this in order to develop a coherent view of the global financial system so that we can deal with emerging vulnerabilities in a timely and effective way. As always, my remarks today reflect my own views and not necessarily those of the Federal Reserve System.
At government level, measures were aimed, first, at supporting financial systems and, further, at stimulating demand. Among the former, selective bail-outs of banks of systemic importance in the opening months of 2008 were followed, after the heightening of tensions in markets as from the summer, by the raising of deposit guarantee scheme limits, governmentbacked bank issues, public injections of capital and the purchase or the safeguarding of the value of troubled assets held by banks. All these measures were under the umbrella of the  2  BIS Review 79/2009  common principles for concerted action, at the level of the Heads of State and of Government in Europe, and at the G20 meetings more globally. Among the demand-stimulus measures, and aside from the operation of the automatic stabilisers, which are pivotal in economies such as Spain, measures based on increased public spending and aimed, on many occasions, at the groups and sectors most adversely affected by the crisis, tended to predominate. The European Economic Recovery Plan approved in December provides the reference point here for the coordination of measures in Europe. The Spanish authorities have also adopted a broad set of similarly geared measures.

The crisis has also highlighted the advisability of designing and setting in place a macro-prudential supervisory framework concerned with overall stability and which thus complements individual bank-focused microprudential supervisory conduct. Macroeconomic strategies should likewise be reviewed in light of the shortcomings they have evidenced, in order to detect and correct in time the imbalances I referred to earlier. In the case of fiscal policies, greater emphasis on the sustainability of public finances in the medium and long term would have provided a more powerful countercyclical component to offset excessive private-sector spending. As regards monetary policy strategy, careful analysis should be made of the role to be played by the identification and appropriate coverage of risks to stability that originate, develop and, in the worst-case scenario, materialise in financial markets. Fiscal and monetary authorities also share the substantial challenge of designing “exit strategies”. These allow, once the crisis has been overcome, for the winding down of the various measures that central banks and governments have adopted in the face of the risk that this crisis might bring the world economy to the verge of a depressive spiral with grave consequences. The raft of measures adopted has been wide-ranging, and many are based on common principles jointly agreed upon in different international fora. Multilateral cooperation is crucial for successfully tackling a global crisis. Further headway must thus be made along these lines, harnessing opportunities such as that provided by the G20 meeting in London last April.
Using the adapted risk model, the maximum assumed risk of loss on the corresponding positions, and hence the requisite capital requirement, was reduced. 18 Granting permission to use this model was, in the conditions prevailing at the time, a logical step and in line with international practice. During the crisis, however, it became clear that the overreliance on risk models was a mistake – something which FINMA (the successor to the SFBC) has also acknowledged in hindsight. 19  Switzerland’s regulatory response to the ‘too big to fail’ issue The financial crisis vividly exposed the shortcomings of banking regulation. A broad consensus quickly developed over the need for a thorough overhaul of the regulatory framework. In Switzerland, the UBS case, in particular, generated strong political momentum for stricter banking regulations. a) Extensive adjustment of international regulatory standards  At international level, the Basel Committee and the Financial Stability Board (FSB) subsequently adopted a number of measures to strengthen banks’ resilience and find a solution to ‘too big to fail’. With respect to banks’ resilience, the Basel Committee increased the minimum risk-weighted capital requirements, in terms of both quality and quantity. It also specified a capital surcharge for systemically important banks over and above the new minimum requirements applying to all banks. Furthermore, it revised the calculation of risk-weighted assets with the goal of restricting banks’ freedom to determine capital requirements.

The mere assumption that a bank is too big to fail can be a self-fulfilling prophecy. 4 On the assumption that it will be bailed out if necessary, the bank may take on excessive risk much more readily, and focus its business model too heavily on debt-based growth. Thus, the bank becomes even bigger, thereby increasing the likelihood that the state will have to intervene in a crisis, so that the original assumption proves to be correct. Given this increased likelihood of a bail-out, the bank can now take on even more risk, and the de facto bail-out obligation becomes even more acute – a vicious circle. This bail-out obligation can result in very high and unforeseen costs to the state. The scale of these costs was highlighted by the global financial crisis, which at the time saw announced  2 3 4  For example, cf. International Monetary Fund (2014) for an estimate of the magnitude of this subsidy. Cf. Afonso et al. (2014). Cf. Alessandri and Haldane (2009). Page 4/14  state support for the financial sector in advanced economies amounting to some 20% of GDP (cf. slide 2). 5 State budgets, which are already under strong pressure from the recession associated with a financial crisis, can be overstretched by the cost of state support measures. And indeed, during the crisis, a number of countries did find themselves having to shoulder costs well in excess of their financial capacities. Ultimately, they coped by resorting to external support.
Demands on supervisory authorities and central banks have therefore increased in recent decades – demands that they monitor, oversee and regulate, when necessary. For monetary policy, the changes in the financial markets have had an effect that has received less attention, as they have affected the channels and markets through which monetary policy measures act. A Swedish example, to which I will return, is the emergence of the market for corporate bonds. These days, one-third of companies’ loan financing takes place on this market, and the functioning of this market has therefore come to affect how changes in the repo rate spread to the interest rates that companies are facing de facto. 2 See, for example, Lundvall (2020) for a summary, as well as the references provided there. See also Andersen et al. (2020). 3 See Andersson et al. (2020), Lundvall (2020) and Ingves (2019). 3 [13]  The same target for monetary policy but the way there looks different The environment in which the Riksbank acts has thus changed in a way that affects monetary policy on several levels. And our way of thinking about monetary policy, what it is and how it should be conducted, has also changed along with our environment. The objective of monetary policy is unchanged and remains price stability, often more concretely defined in terms of stabilising inflation around 2 per cent.

Long-term unemployment is a significant problem in the broader economy, and something that I will discuss in more detail later in my remarks. Next, we will take a tour of the American Job Center, an organization that provides workforce assistance to job seekers in conjunction with local businesses. Later we will attend, a roundtable lunch with members of the Bridgeport Regional Business Community. And, finally, we will meet with leadership from the Housing Development Fund, New Horizons and NeighborWorks America to hear about the state of affordable housing and community development in Fairfield County. These trips are valuable to us, and represent one of the many ways in which the New York Fed engages with people and businesses in our region. Another one of our efforts in this vein is our Small Business Credit Survey – the latest version of which was released last month. This survey – which includes responses from across 26 states – helps us understand the challenges facing small businesses in the region, focusing on financing needs and impediments to obtaining credit. We partnered with multiple organizations throughout Connecticut to produce this survey – some of which are right here in Bridgeport – and received responses from nearly 200 small business owners from around the state. I’d like to personally thank those who participated in the survey. The remainder of my remarks will focus on recent developments in the national and local economy.
Norway was close to being placed under IMF administration. In fact, it was not possible to steer the economy towards permanent prosperity. The old doctrines collapsed.6 New ideas for managing the economy took shape because the old system no longer functioned. Underlying the new truths was the notion that economic policy needed to operate through the proper market incentives and that economic policy must be sustainable and predictable. At the Ministry of Finance, the new ideas took hold primarily because a younger generation was taking over, just as when Nissen was pushed aside. Political micro-management lost considerable traction. Through the 1990s and up to the mid-2000s, economic growth was high and both inflation and unemployment low in much of the world. Cyclical fluctuations were moderate. The new truths appeared to be working well. This period is known as the Great Moderation. But underneath the positive developments, imbalances were building up both within and across countries. As we have all experienced, it is easy to ignore the bill as long as the food keeps coming and the conversation keeps flowing. Countries and governments can live with deficits for a while, but sooner or later the bill has to be paid. 5  Einar Lie provides a detailed account of the break between classical and the new, more Keynesian thinking at the Ministry of Finance in the book Norsk økonomisk politikk etter 1905 [Norwegian economic policy after 1905], Pax forlag, 2012.

See, for example, George Benston (1989), The Separation of Commercial from Investment banking: The Glass-Steagall Act Revisited and Reconsidered, Kluwer Academic Press, Randall S. Kroszner and Raghuram G. Rajan (1994), “Is the Glass-Steagall Act Justified? A Study of the U.S. Experience with Universal Banking before 1933”, American Economic Review, Vol. 84, pp. 810–32, Eugene N. White (1986), “Before the Glass-Steagall Act: An Analysis of the Investment Banking Activities of National Banks”, Explorations in Economic History, Vol. 23, pp. 33–55, and Charles W. Calomiris (2003), U.S. Bank Deregulation in Historical Perspective, Cambridge University Press. Marc Flandreau (2011), “New Deal Financial Acts and the Business of Foreign Debt Underwriting: Autopsy of a Regime Change” shows how the Glass-Steagall Act and other New Deal legislation conferred greater power on policymakers at the expense of international bankers and discusses some consequences for financial markets. Flandreau’s article can be downloaded from Norges Bank’s website: http://www.norges-bank.no/Upload/82434/EN/FLANDREU%20 Paper.pdf. In this area, there are few, if any, ultimate truths, and the pendulum appears to be swinging back again. In the US, the UK and the euro area, reintroducing some sort of separation between retail and investment banking is now being discussed (cf. the Volker Rule (US), the Vickers Commission (UK) and the Liikanen Plan (EU). Andrew Haldane at the Bank of England has recently discussed this issue in his speech, “On being the right size”, where he also outlines proposals for future banking sector regulation (see http://www.bankofengland. co.uk/publications/Pages/speeches/2012/615.aspx).