samchain/econo-pairs-v1 huggingface dataset:
When able to issue such assets, private issuers pay a very low interest rate, as others in the economy demand the apparent safety that those assets provide. That situation gives the private financial sector strong incentives to issue money-like claims. However, the excessive issuance of such instruments can lead, at some point, to a loss of confidence in them. In turn, that can reduce demand for these instruments and lead again to a rapid deleveraging by the issuers of these instruments. Much like the case that F.D.R. discussed for banks in the 1930s, the runs on these short-term debt instruments can lead to fire sales of assets by the institutions that were relying on the issuance of money-like instruments to finance their portfolios – and those sales cause distress for many others throughout the economy. Procyclical leverage of financial intermediaries In a series of papers, Tobias Adrian and coauthors have made a number of findings about the behavior of financial intermediaries, that is, banks, broker-dealers, and other financial companies, and how their leverage varies over time.

It is determined by the structure of the economic process and the dynamics of expectations. There is, realistically speaking, no chance to deduce a general policy rule and to formally embody such a rule in the central bank mandate. Any decision to correct slowly and gradually or in a single bold effort any deviation from price stability, whatever its origin, can only be taken individually. Monetary history has successful examples to show for both patterns of reaction, but also unfortunate episodes in which central banks actually increased the variability of the price level and of output through activist manoeuvres. It would thus appear reasonable that an addendum, unspecified as to substance, should be made to the mandate of ensuring price stability. For example, to the effect that in fulfilling the mandate due attention should be paid to the development of economic activity. Art. 99 of the Swiss Federal Constitution obliges the SNB to conduct a monetary policy which serves the general interests of the country. Endeavours are under way to spell out this vague formulation in  BIS Review 35/2000  4  more detail in the forthcoming comprehensive revision of the National Bank Law. When revising our monetary policy concept, we took a step in this direction by quantifying the stability target (CPI inflation below 2%) and undertaking to adhere to the target in the medium term. Transparency A further aim was to continue to improve transparency. It is a fact that the call for more transparency has sounded far and wide.
Indeed each of these elements could be hotly debated, and doubtless will be if we proceed to a consultation. For example, what should the “x” in £ be? On the one hand it would be good to have as many firms as possible benefit – but on the other hand, as “x” gets higher the scope to simplify will probably diminish. And to give you a sense of the distribution, out of the PRA’s current population of 110 UK deposit-takers a cut-off of £ would capture 48 firms, £ 78 firms, £ 84 firms, £ 91 firms and so on. Of course in thinking about these thresholds one immediately runs into two issues. First, the barriers to growth problem – by creating a new step in the regime we might add to the difficulty of growing. One solution to this could be to make the simple regime optional – firms that have no great ambitions to grow could opt in, while those who want to become large and prefer to get to grips with the whole regime early could opt out. Second, those firms who don’t meet the definition might feel hard done by and lobby against it, or lobby for other changes which make the overall regime less strong. There is no avoiding this, other than to appeal to the greater good. The second design question is how to simplify. There are two main options, which are not mutually exclusive: replace existing requirements with simpler versions; and/or narrow the set of applicable requirements.

BIS Review 28/2007  7  The experience of previous business cycles has shown that wage and price inflation may increase markedly in a late phase of the upturn. Higher interest rates will counter such a development. However, we must also prevent inflation from becoming entrenched well below 2.5 per cent. We will therefore be mindful of the effects of higher interest rates on the krone exchange rate when inflation is low. Positive supply-side conditions that have held down inflation so far suggest a gradual approach, so that we can assess the effects of interest rate increases and other new information on economic developments. At the meeting on 15 March, Norges Bank’s Executive Board presented the interest rate path shown in the chart. The Board decided that the key policy rate should lie in the interval 4-5 per cent in the period to the publication of the next Monetary Policy Report on 27 June, conditional on economic developments that are broadly in line with projections. Furthermore, the key policy rate is expected to move up to about 5 per cent around the end of 2007. Economic developments are uncertain. The uncertainty surrounding the interest rate ahead is illustrated by the shaded area in the chart, which is intended to capture the outcome with a 70 per cent probability. Long-term interest rates, income growth and house prices Favourable economic developments in Norway have had an impact on developments in our property markets. House prices have risen sharply over the past 14 years.
José De Gregorio: Chile’s approach to external turbulences and threats Speech by Mr José De Gregorio, Governor of the Central Bank of Chile, at the “Economic and Entrepreneurial Vision 2011–2012”, organized by the Manufacturers Association SOFOFA and Universidad del Desarrollo, Santiago, 19 October 2011. *  *  *  I thank the valuable comments of Luis Álvarez, Luis Óscar Herrera and Enrique Orellana. In the past several years we have endured macroeconomic turbulences of unbelievable magnitude, as well as new challenges. The years 2007 and 2008 saw a sharp increase in inflation, then came the global financial crisis and the recession of 2009, to be topped off by an earthquake and a tsunami in February 2010. Today we can say that we weathered this string of difficulties but we remain on the alert, because the threats from the world economy are far from over. These days, our greatest concern is the state of the developed economies and its ramifications on the emerging world and particularly Chile. In mid-2009, the world economy began to recover from the effects of the international financial crisis. However, such recovery featured two different speeds (figure 1). The emerging economies have grown strongly and have had to deal with risks of inflationary pressures and fast credit growth, while the developed economies have recovered slowly. Since the middle of last year, we have stated in our Monetary Policy and Financial Stability Reports that there are many risks still latent.

Last week, the Banco de España held a high level seminar on the future of euro area governance titled “Strengthening euro area economic governance: short-term priorities and the long-term view”. A webcast of the seminar is available on the Banco de España’s website which I recommend to those interested in the subject. I will not dwell on this topic but I would like to say that, on the financial side, completing the Banking Union and fostering the Capital Markets Union must be at the top of the political agenda. Completing the Banking Union will help to weaken the links between banks and sovereigns and to be better prepared to deal with large macroeconomic shocks. Fostering the Capital Markets Union will help to promote greater diversification of private sector funding sources and greater robustness of private risk-sharing arrangements. These projects pay attention to the two main channels through which credit flows to the economy in Europe, and they are key blocks in EMU’s future architecture. A window of opportunity seems to be open now and it should not be wasted. Secondly, focusing on the Capital Markets Union, despite progress having been somewhat slow, there are certainly areas where advances have been made. Later today, the programme of this conference offers an opportunity to hear directly from the European Commission on the Capital Markets Union. Accordingly, my objective now is merely to point out a couple of areas where initiatives have been taken to reactivate specific markets. One of those areas is the securitisation market.
Turning to decentralised finance, while still in its early stages, this market segment has proven stamina as it quadrupled its size in just one year.15 What’s more, other parts of the crypto-asset ecosystem echoed this movement. For instance, the need for collateral tailored to this environment spurred demand for certain types of digital assets. The same could be said about certain investment strategies, known as yield farming, which support the automated lending or borrowing of crypto-assets in order to underpin DeFi’s markets liquidity.16 The vulnerability and interconnection on this segment has been illustrated by the sudden fall of Terra that caused this market to shrink by 22% in less than a month with an ensuing snowballing effect on several DeFi protocols and major fiat-backed stablecoins. Yet, most other stablecoins did not experience significant outflows or de-pegging, and unbacked crypto-assets’ prices seem to have surged back again. Risks to financial stability The above developments have caused a number of valid concerns among financial authorities. For instance, the Financial Stability Board (FSB) recently stressed that, if not properly regulated and supervised, these markets could quickly reach an inflection point 12  ETFs are investment instruments that function as a hybrid between funds and shares. Their defining characteristic is that they can be traded and settled in straightforward stock exchange transactions much like shares. 13  A case in point is the Chicago Mercantile Exchange, which in October 2021 became one of the first to launch a bitcoin ETF.

In certain cases, their carbon footprint is as large as the one of 15.5 million petrol cars in a year.26 Sixth, since crypto assets can also be used for unlawful activities, including money laundering, financial integrity concerns follow. Such risks could be larger on account of the fact that transactions are performed through non-standard payment systems and their heightened degree of anonymity. Seventh, crypto-assets’ value could also become swiftly eroded on account of the limitations and problems associated with cyber risks associated to the technologies underpinning their operations, i.e. blockchains. This could occur due to a wide range of possible causes, such as their technical configuration placing constraints on the scale of operations, which would prevent growing public demand from being met. While progress is 23  Investment in or proprietary trading of crypto-assets or the purchase of structured products in which they are an underlying asset would appear to be the most common means by which they are incorporated onto banks’ balance sheets. 24  In certain cases (e.g. El Salvador), this state of affairs is deliberate. 25  See “Cryptoassets as National Currency? A Step Too Far”. T. Adrian and R. Weeks-Brown (2021), IMF blog, 26 July. 26  See “Hearing on Cleaning Up Cryptocurrency: The Energy Impacts of Blockchains”. US House of Representatives Committee on Energy and Commerce (2022). 7  being made in this field, these developments are still far from being mature enough.
Asset owners are swapping out part of their fixed income exposure for private credit, supporting demand for this asset class. Given that private credit is higher up in the capital structure of a firm than private equity, the former can also offer investors better protection during a downturn. Despite the uncertain global outlook and more cautious lending environment, private credit players are well placed to seize lending opportunities in Asia and globally. MAS is taking steps to develop Singapore as a full-service private markets hub through the expansion of its Private Markets Programme. I am pleased to announce that MAS has expanded the size and scope of its Private Markets Programme (PMP) to invest an additional $ billion with top global private credit fund managers. Under the PMP, MAS allocates investment mandates to PE and infrastructure fund managers who are committed to establishing or deepening their presence in Singapore. As a result of the $ billion allocated to-date, these managers have committed to grow their assets under management in Singapore. Some have designated the Singapore office as the regional HQ, grown their value creation teams here, and collaborated with institutes of higher learning to create training programmes. The $ billion top-up brings the size of the PMP to $ billion. CONCLUSION Before I conclude, let me add that Singapore’s connectivity and ecosystem provides the perfect springboard for PE/VC managers to capture opportunities in Asia.

Speeches  Published Date: 20 September 2022  "Critical Economic Uncertainties" - Keynote Speech by Mr Ravi Menon, Managing Director, Monetary Authority of Singapore, at the SuperReturn Asia Conference on 20 September 2022 Ladies and gentlemen, good morning. I am happy to join you at the SuperReturn Asia Conference — the first time the conference is being held fully in person since the start of COVID-19, and the first time here in Singapore. Uncertainty has become the dominant theme in investment today. Let me touch on four key uncertainties around the global economy: first, how severe will the economic downturn be next year? second, where is inflation headed in the medium term? third, how will geopolitical tensions impact the global economy? fourth, how might climate risks affect investor portfolios? HOW SEVERE WILL THE ECONOMIC DOWNTURN BE NEXT YEAR? The global economy is facing a severe bout of inflation with two positive stimuli to demand coming up against two negative supply shocks. On the demand side, the lagged effects of the massive fiscal and monetary stimulus in response to the pandemic coupled with the unleashing of pent-up demand following the re-opening of economies have substantially added to general inflationary pressures. Supply disruptions stemming from the lingering effects of the pandemic and the Russia-Ukraine war have sharply driven up global food, energy, and commodity prices. The surge in inflation has necessitated monetary policy tightening by central banks, at a pace not seen in the last four decades.
Early evidence from the Bank’s Decision Maker Panel Survey suggests that the impact of Brexit holding back business investment growth may be less in 2018 than 2017. 5  All speeches are available online at www.bankofengland.co.uk/speeches  5  What is the Bank’s role in this context? I have been thinking about the whole range of policy challenges associated with productivity since the aftermath of the financial crisis in my former role at the Treasury. My role has changed since then, and I naturally have a different focus in my new role. It is the Bank’s responsibility to deliver monetary and financial stability. But by delivering low inflation, a safe and sound financial system, and a payments and settlements system that operates smoothly, we are ensuring the right environment for business investment. But our responsibilities for the financial sector mean that our role doesn’t stop there. For example, we can play an important role in supporting the development of new technologies (Slide 8). The Real Time Gross Settlement (RTGS) renewal programme, which I oversee at the Bank, is a major investment in the UK’s financial infrastructure which will deliver a range of new features and capabilities. RTGS is the means by which central bank reserves are transferred between banks big and small, and settles around £ of transactions per day. Although we decided that distributed ledger technology wasn’t sufficiently mature to support the core RTGS system, we will ensure the system works with that technology, however it evolves.

Let me start with labor income, which for most households is the dominant source of household income. As one would expect, differences in labor income across individuals of a given age tend to increase as people get older. Some of this is due to education and occupation choices – and how they impact income growth―and some is due to various events that individuals face in their working lives. Unemployment risk is an example of an adverse development that can substantially affect people’s careers and labor income during their lifetime. Over the period from 1976 to 2015, the overall unemployment rate averaged around 6.5 percent, but unemployment varied substantially across regions and across worker backgrounds. Unemployment was especially high for workers with lower earnings, a group that tends to have little savings to draw upon. Looking across demographic groups, younger workers, less-educated workers and those in manual occupations, as well as workers who identify as Black or Hispanic, experienced significantly higher average unemployment rates when compared to older and college-educated workers. These stark differences across demographic groups in terms of levels of unemployment are also evident in terms of how unemployment changed over business cycles, including the Great Recession. While the overall unemployment rate increased from 5 percent in December 2007 to 10 percent in October 2009, it increased substantially more for workers with lower earnings. In other words, looking at the national unemployment rate tells only part of the story of the labor market experiences for different groups of individuals.
Public finance Distinguished Participants, It is well known that developments in debt stock are of great importance with respect to managing the expectations of economic agents and, thus, the course of the risk premium. In this framework, these developments are closely monitored as regards monetary policy and inflation. In the current period, the rate of increase in the debt stock slowed down significantly due to decreasing interest payments and the high primary surplus and the downward tendency in the ratio of public debt stock to GNP continued. It is observed that the same trend still continues even when parity and exchange rate effects are excluded from the change in debt stock. Additionally, it is considered that the structure of debt stock has become stronger against the risks in the said period. Decreasing the susceptibility of debt stock towards exchange rates and limiting its susceptibility to interest rates on one hand, and the risk reduction in debt roll-over owing to the extension of the borrowing maturity and the strengthening of cash reserves on the other hand, are the factors that support our mentioned assessment (Graph 24). BIS Review 67/2006  15  Graph 24.

Medium-term forecasts Current stance, short-term outlook and the assumptions Current stance relating to real sector variables that constitute the basis for the forecasts presented in the previous Inflation Report have been preserved in this Report to a great extent. Despite rapid growth in domestic demand in the last quarter of 2005, the ongoing increase in the ratio of investment expenditures to GDP eased the pressures on inflation imposed by the increase in demand by pushing the production capacity upwards. Moreover, continuing productivity proceeds limited the increase in costs, thus limiting the pressure on inflation. While producing forecasts, the short-term outlook relating to domestic supply and demand conditions was developed in the light of these findings. Real interest and real exchange rate variables, which determine the relationship of supply-demand conditions to inflation and constitute the starting point of the monetary transmission mechanism, are also significant components of the assumption set that constitute the basis for medium-term forecasts. It is assumed that in the current situation, real interest rates are not at a level that can exert pressure on credit increases and demand conditions. Nevertheless, under a main scenario in which the current program will continue to be implemented, macro and political stability will not deteriorate, structural reforms and, accordingly, long-term capital inflows as well as productivity increases will continue, it is assumed that the New Turkish lira will retain its strong position and will continue to support the decline in inflation.
Mojmír Hampl: Central banks, digital currencies and monetary policy in times of elastic money Speech by Mr Mojmír Hampl, Vice Governor of the Czech National Bank, at the Official Monetary and Financial Institutions Forum (OMFIF) Roundtable, London, 11 July 2017. * * * Ladies and gentlemen, Good afternoon. Before I start in earnest, let me thank the OMFIF for the kind invitation to this event, which allows me to speak in front of such a distinguished audience. It is an utmost pleasure for me to be here. The topics of today’s session are threefold: cryptocurrencies, central bank digital currencies and monetary policy with elastic money. I’ll try to touch upon all of these topics and bind them together, yet I realise the task is challenging. Let me begin with a story from Prague. In our capital city we have a strong community of supporters and users of cryptocurrencies. Among libertarians, some of them my ex-colleagues or friends from the University of Economics in Prague, bitcoin is seen as a real, fully fledged alternative to the current monetary order. Indeed, I could show you a place in Prague where one can only pay in bitcoin. By the way, I appreciate the name chosen for the most popular cryptocurrency, bitcoin. In the era when the foundations of the monetary system were based on precious metals, people sometimes “bit the coins” to check whether or not they were counterfeit.

In the digital age, of course, biting won’t help, and standard counterfeiting doesn’t rank among the many problems that bitcoin faces. Two years ago we held a seminar on cryptocurrencies (and especially bitcoin) at our central bank. When we were preparing for the event, people from the libertarian, cryptocurrency-loving community in Prague asked me: aren’t you afraid of us? Aren’t you afraid of bitcoin and other independent, central-bank-free currencies and their power to marginalise traditional money? I said – well, not really. Let’s put aside the fact that all of these alternative currencies are still marginal in terms of size and scope (all the electronic transactions using bitcoin worldwide combine to some 16% of the number of electronic transactions conducted in the Czech koruna, a currency used by a mere 10.5 million people). Bitcoin’s global market cap also constitutes only a fraction of even the Czech money supply. The key problem is bitcoin’s constantly changing purchasing power. So far it has been more volatile than natural gas, the most volatile commodity. Such a feature is really worrying for any innovation that wants to be seen as money: a means for paying and settling transactions, a unit of account and a store of value. Let’s try to imagine the following: today’s five pound note being worth ten pounds tomorrow and then one pound the day after tomorrow. It would be very difficult to exist in such a monetary system, to use the currency in everyday life.