samchain/econo-pairs-v1 huggingface dataset:
Specifically, voices have been raised in favour of a substantial increase in the minimum non-weighted capital requirement, the leverage ratio. Moreover, demands for an outright separation of investment banking from commercial banking, along the lines of the Glass-Steagall Act, have gained political clout. While these proposals have merits – and, given the difficulty of the task, one should keep an open mind – qualifying remarks seem appropriate at the current juncture. We are in the midst of implementing a complementary and balanced package of measures. As we have seen, tangible progress has already been made. When it is fully implemented, this package will substantially reduce, and possibly eliminate, the TBTF problem. It is unlikely that a sudden change in strategy would lead to a faster elimination of the underlying risks. Rather than changing the regulation strategy midway, it is imperative that we press on with the full implementation of the TBTF package. We will then be in a position to assess its effectiveness and decide whether further measures are necessary. Full implementation entails, necessarily, further progress on the following four issues: First, the big banks must stay on track, and must fully and consistently implement the tighter risk-weighted capital and liquidity requirements as currently planned. This will, importantly, lead to a significant improvement in their leverage ratios. Second, the quality of the banks’ own risk assessment methods must be improved. Increasingly, doubts have been raised on the reliability of the internal models which banks use to compute their risk-weighted assets (RWAs).

2  BIS central bankers’ speeches  requirements by the end of 2014.4 At the same time, regulators are working on the establishment of resolution and recovery plans. When finalised, these plans should enable the regulators to secure the orderly resolution of a global bank in the event of a severe crisis and, in doing so, to make sure that systemically important functions can be maintained. As an important step towards this goal, FINMA has been authorised, since November 2012, to order a bail-in of creditors to generate the financial means necessary for restructuring a bank. Turning to cyclical risk, in June 2012, the Federal Council announced a set of measures consisting of three elements: (1) a permanent increase in risk weights for high loan-to-value mortgage loans,5 (2) a revision of the banking industry’s self-regulation guidelines for mortgage lending,6 and (3) the legal basis for the activation of a countercyclical capital buffer (CCB), as proposed in the Basel III framework. This instrument allows for a temporary increase in capital requirements when imbalances appear to be building up in the credit markets. It thus aims to increase the resilience of the banking system, and helps to lean against excessive credit growth. In February 2013, following a proposal by the SNB, the Federal Council activated the CCB, requiring banks to hold additional capital amounting to 1% of risk-weighted residential mortgage loan positions. Banks have been obliged to comply with this rule since 30 September 2013.
The question we ask is whether this levelling off is permanent or whether we may expect a further reduction in the use of cash. Let me briefly outline three factors I believe may be of some significance: First, it has become less expensive to use cash in the 1990s. Cash is not an interest-bearing instrument. As such, forfeited interest income is part of the “cost” of using cash. A declining interest rate in the 1990s has substantially reduced this cost, both for the public and banks. Second, the public has been spared the real costs of cash use, while other payment instruments have increasingly been assigned full-cost prices. And third, developments in new payment instruments for small payments - cash cards - have progressed slowly. This is probably in part because we already have a well-developed EFTPOS infrastructure in Norway, and perhaps in part related to what I mentioned above - that cash continues to be an efficient and inexpensive alternative. 7  EFTPOS= electronic funds transfer at the point of sale. 7  BIS Review 7/2000  Predicting further developments in the use of banknotes and coin, both internationally and in Norway, is a difficult task. Low inflation, low interest rates and greater access - for example, via the EFTPOS system’s cash-back arrangement - will promote the further use of cash, whereas new technological solutions will reduce it. Developments in relative prices will also be of importance.

Banks will continue to be linked through interbank loans, and problems in one institution may still lead to considerable spill-over effects even if the settlement risk of the net settlement has been eliminated.2 Moreover, the risk may increase for other institutions which must grant more credit (to those in need of liquidity for the gross settlement) or for institutions which do not receive settlement as quickly as before (due to queuing problems with the gross settlement). -  Second, the transition to gross settlement may increase the liquidity costs for settlement participants. Whenever transactions are to be settled concurrently, there is always a risk of “gridlock”, i.e. that settlement is halted because liquidity has been unevenly distributed. However, this is a well-known situation and is resolved in many countries by the central bank providing loans to system participants. Third, there is greater need to balance risk against efficiency In recent years, more attention has been drawn to weighing risk against efficiency. This is particularly the result of experiences we and other central banks have had with the new payment systems and the accompanying operating rules. RTGS systems are relatively liquidity intensive, and the cost of collateral may be fairly high. Compared with the initial situation - “non-secure” net systems - this cost was widely considered as a reasonable price to pay. However, a number of “in-between solutions” i.e. hybrids - have appeared over time, blurring the distinction between net and gross systems.
Instead, it should be regarded as a meaningful and flexible framework for increasing nominal and real convergence with the euro area, and for tackling the challenges faced by the accession countries as they progress towards the adoption of the euro. Indeed, the experience of current euro area member countries in the fields of inflation and exchange rate developments strongly suggests that the existing institutional framework for accession to the euro area, including the convergence criteria as defined in the Maastricht Treaty, is sound. Furthermore, this framework should be sufficiently flexible to accommodate most of the challenges that accession countries will face on their path to the eventual adoption of the euro. 4. Capital account liberalisation  Ladies and gentlemen, the fourth economic issue I would like to refer to is capital account liberalisation. In several accession countries, capital movements are still subject to a number of restrictions. The most relevant restrictions, from a monetary policy perspective, apply to short-term portfolio investments. Although transitional periods may be allowed under the Treaty in the early years of EU membership, as well as prior to accession under the Europe Agreements, thus far, only a few countries have requested them. In those few cases, transitional periods mainly relate to areas that are not particularly relevant from a monetary policy point of view (e.g. real estate purchases).

Inflationary pressures stemming from high productivity growth in the tradable sector of fast-growing economies – known as the Balassa-Samuelson effect – have also been cited as one of the main reasons for higher inflation in catching-up economies, such as those of the accession countries. A closer examination of inflation developments in the accession countries shows, however, that the Balassa-Samuelson effect alone cannot explain the persistence of inflation differentials vis-à-vis the euro area. Moreover, notwithstanding its importance, the Balassa-Samuelson effect should not be overstated when explaining current inflation rates in the accession countries. Indeed, most empirical studies estimate the Balassa-Samuelson effect within a range of 1 to 2 percentage points. This does not mean, however, that the pursuit of real convergence conflicts with further progress on disinflation. On the contrary, the process of disinflation should be advanced in the accession countries, at a pace determined by the overall economic situation and in particular by the need for these countries to increase real convergence. The Maastricht inflation criterion, which will not be revised to take into account any possible Balassa-Samuelson effect, should not be seen as an immediate requirement for these countries, but rather as a medium-term objective for central banks. As the experience of some euro area participants shows, progress in nominal and real convergence can be, and should be, pursued in parallel.
We have experienced that partial reinvestment now for a few months because it was decided back in March. It has been well-absorbed by markets. We have not observed any disruption. Given the amounts that we are talking about, we have reasons to believe that it should be absorbed also in a smooth manner. But, of course, we will be very attentive. We will look at this process. We will, as I said, always have the means to take action and to use all the tools that we have available if it was needed. You've touched on the problem of the wage increases. At your speech at the European Parliament, you touched on the problem of corporate profits. If you take these both together, how confident are you that the relevant parties actually start to be more moderate on this, in particular as both of them start to criticise that interest rates are already too high? The second question: I'm also a bit puzzled about the real severity and persistency of this core inflation. May I ask you as well, please, to elaborate a little bit more where the Governing Council sees the reason for this really strong persistence? The labour market situation and the employment situation is the good news in Europe, and we have never seen the unemployment rate be so low. Actually in our forecast we see the unemployment rate go from this 6.5% that we have now, to 6.3%. We see the level of unemployment continuing to decline.

For sterling borrowers, that bridge is built on the foundations of SONIA – the Sterling Overnight Index Average, produced every day by us at the Bank of England and based – unlike LIBOR – at around 60 billion pounds of real, daily transactions1;  -  And, second, while that work has been underway, we’ve shored up the old LIBOR bridge, through the FCA’s agreement with LIBOR panel banks to continue providing submissions to the benchmark. But those repairs were only ever temporary. The FCA can’t replace those markets that used to underpin LIBOR submissions: they are gone forever. And the FCA’s agreement with the panel banks runs out at the end of 2021. From 2022, therefore, the availability of LIBOR cannot be guaranteed. Something that is unsafe today will become lethal at the end of next year. 1  The Sterling Overnight Index Average (SONIA) is administered by the Bank and reflects the average of the interest rates that banks pay to borrow sterling overnight from other financial institutions See www.bankofengland.co.uk/markets/sonia-benchmark. 2  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  2  Avoiding that outcome is what we’re here today to discuss. But before we dive into the detail I want to leave you with three key messages: -  First, LIBOR transition affects every company that borrows in sterling. You cannot ignore it, or hope that it goes away: you need to act well before the end of 2021. -  But, second, there is time if you start now.
 Inflation is high, but will fall towards the 2% target over the coming years. BIS Review 100/2008  7  Outline  International developments  Developments in Sweden  M onetary policy  What has happened during the summer  Basis spread Difference between interbank rates and expected policy rates Basis points 120  100  120 M PR 2008:2  Sweden USA Euro area  100  80  80  60  60  40  40  20  20  0 jan-07  0 apr-07  jul-07  okt-07  jan-08  apr-08  jul-08  Sources: Reuters EcoWin and the Riksbank  8  BIS Review 100/2008  GDP growth in the USA Quarterly changes in per cent calculated at an annual rate, seasonally-adjusted data 8  8  6  6  4  4  2  2  0  0  -2  -2 00  01  02  03  04  05  06  07  08  09  10  11  Note. Broken columns represent the Riksbank’s forecasts in M PR 2008:2. The dot is the outcome for Q2 2008.

In practice this often means that we allow the time for bringing inflation up or down to the target to vary depending on the prospects for economic activity. According to our monetary policy strategy, our policy is normally aimed at attaining the inflation target within two years. The calculation we made in July indicated that it would probably have required a slightly higher interest rate path than that described in the Report to bring inflation down to 2 per cent in two years. This would have brought down growth even lower next year. Given that inflation was deviating so far from target and taking into account the uncertainty in the financial markets, it would have been better, in my opinion, to aim at bringing down inflation to around 2 per cent in three years. I do not believe that the decision in July can be regarded as any severe tightening of monetary policy. The interest rate is still relatively low. The nominal interest rate prior to the decision at the beginning of July was at a long-term average of 4.25 per cent. But the real interest rate was still lower than an historical average. In July the real interest rate was around 1.5 per cent, but it will rise during the forecast period to just over 2.5 per cent at most. The interest rate path we described in July entailed a change from a relatively neutral to a slightly contractionary monetary policy.
China uses 45 billion pairs of disposable chopsticks per year, which requires 25 million full-grown trees to make (International Herald Tribune, 27th October 2005). This means massive deforestation and an adverse impact on the environment. Another problem is the widening income gap. Bear in mind that there are 26 million Chinese still living in abject poverty, earning less than $ annually. China will also face the trickier problem of managing the demand for political change and greater political participation as it becomes a middle income country. For the first time, China recently published a White Paper on 'Building of Political Democracy in China'. 15. China's leaders know that they will retain the mandate of heaven only if they deliver the economic goods and a better standard of living. Having tasted the fruits of market-oriented policies, the Chinese people will want more. To grow, China needs a stable external environment. This is why China's leaders have been careful to assure the world that it will pursue a 'path of peaceful development' ( ). They are well aware that China's rapid growth is creating enormous pressures on the international system and that they need to craft a development and foreign policy strategy that will ensure the peace and stability needed for its growth. The trundling Indian elephant 16. Let me now turn to India, which is also shaking off old mindsets and taking pragmatic steps toward reform and liberalisation. 17. I first visited India as Prime Minister in 1994.

Japanese companies can also take advantage of Singapore as a hub for knowledge and market intelligence. Over the years, we have developed a network of institutions that have a deep reservoir of knowledge on China, India and Southeast Asia. Our businessmen are also familiar with these countries. We are now building up links with the Middle East. 46. Japanese companies based in Singapore can enjoy not only benefits from the JSEPA, but also 10 other FTAs that Singapore has concluded with major economies like the US, South Korea and Australia. I would like to highlight the Comprehensive Economic Cooperation Agreement (CECA) between Singapore and India as it is the first comprehensive FTA that India has signed with any country. Conclusion 47. The rise of China and India will shift the global economic centre of gravity from West to East. Remaking our economies cannot be an occasional exercise. Governments must respond boldly and continuously to the imperatives of our changing times. Likewise for companies. This is the only way to ride the rising Asian tide. 48. Thank you. I will be happy to take your questions. BIS Review 83/2005  5
For example, the actual default of a major bank may seriously affect depositors’ savings (though reimbursement up to the insured level of retail deposits is to be provided by deposit insurance schemes) and the financing of otherwise profitable investment projects. But even in case of no actual default, SIFIs may pose serious challenges. Because of the potentially high damage to the financial system and the real economy in case of default, there is the expectation that governments and supervisors would not let a SIFI fail. This implicit support may provide an incentive to the institution to engage in profitable but risky activities, giving rise to “moral hazard”. It also means that a SIFI can finance itself at a lower cost compared to other similar institutions, which are not deemed to be systemically important. In short, incentives are misaligned and the playing field is distorted. These problems have probably increased in the wake of the financial crisis following some of the voluntary, and less-voluntary, marriages among institutions that have created even bigger and more complex financial groups. Reflecting these concerns, at the G20 summit of April last year in London, it was decided that SIFIs should be subject to an appropriate degree of regulation and oversight. At the same time, the G20 entrusted the FSB with the task of overseeing concrete regulatory steps and monitoring their implementation. The FSB is now considering various policy options to address the concerns I mentioned.

Although the international money markets have now calmed somewhat, we have not yet seen the end of the turmoil on the financial markets – neither for the financial institutions involved nor for the international economy. After four years of strong growth and low inflation, this means more difficult times ahead for the Swiss economy. Due to the turbulence on the financial markets, the economic outlook has become more uncertain while, at the same time, inflationary pressure has heightened over the past few months – not such a comfortable position for a central bank. A positive element remains the achievements of the past few years, which have laid the foundations for a higher long-term growth trend. These need to be further improved in order to retain Switzerland as a dynamic business location. BIS Review 21/2008  1
As was the case before the crisis and indicated in the June 2011 principles, the Committee intends to adjust the policy stance during normalization primarily through actions that directly influence the level of the fed funds rate and other short-term interest rates rather than through active management of the size or composition of the Fed’s securities holdings. Specifically, when economic conditions and the economic outlook warrant a less accommodative stance of monetary policy, the Committee will raise its target range for the fed funds rate. During normalization, the Committee intends to move the fed funds rate into the target range primarily by adjusting the rate of interest on excess reserve balances (IOER) that it pays. We expect changes in the IOER rate to have a significant influence on the fed  BIS central bankers’ speeches  1  funds rate and other short-term interest rates. However, to help control the fed funds rate, the Committee also intends to use an ON RRP facility and other supplementary tools, as needed. The Committee will use an ON RRP facility only to the extent necessary, and will phase it out when it is no longer needed to help control the funds rate. With regard to the Fed’s balance sheet, the Committee intends to reduce securities holdings in a gradual and predictable manner, primarily by ceasing to reinvest repayments of principal on securities held in the SOMA.

Today's forum will be an opportunity for the sharing of views and experiences, with both local and global perspectives, on Malaysia's value propositions and competitive advantages as an ideal SSO destination. In developing Malaysia's competitive advantages, efforts to position Malaysia as an international Islamic financial centre under the MIFC initiative have propelled Malaysia's standing in the global Islamic finance sector. With a strong and comprehensive Islamic financial system supported by a robust regulatory regime and well established legal framework already in place, the envisioned landscape is that MIFC will be a centre for the offering of Islamic financial products and services in international currencies with a large pool of highly skilled Islamic finance expertise. Leveraging on the growing significance of Islamic  BIS Review 133/2007  1  finance in Malaysia as well as globally and Malaysia's international standing as an SSO destination, the development of Malaysia's SSO potential in Islamic finance would harness these two strengths in a meaningful manner. Today's forum will explore the possibility of the pooling of resources by various Islamic financial institutions in Malaysia to develop a shared platform for the outsourcing needs of these stakeholders. The benefits from such an initiative would be apparent in terms of achieving economies of scale and the avoidance of duplication of resources. Of course, establishing the necessary infrastructure for such an initiative would entail considerable commitment to address all the practical issues and avoiding the pitfalls.