samchain/econo-pairs-v1 huggingface dataset:
Chart 3: Consumer confidence and spending 10 Percentage change on 19Q4 5 Retail Sales (LHS) 0 -5  Headline Consumer Confidence (RHS)  Percentage point difference on 19Q4  Chart 4: UK Misery Index  10 5  Misery index  16  Forecast  14  0  12  -5  10  -10  -10  -15  -15  8 6 4  2022  2020  2018  2016  2014  2012  2010  2008  0  2006  -25  2004  -25  2  2002  -20  2000  -20  Sources: GfK/EC, ONS. Sources: ONS and Bank calculations  Notes: Headline consumer confidence is based on the  Notes: Index is summation of the unemployment rate and  average of five survey balances: general macroeconomic  inflation rate. Forecast is based on projections in Aug 2020  situation over the past 12 months and expectations for the  Monetary Policy Report. next 12  If the public do have an exaggerated sense of the risks they face, what might be its source? Psychological studies suggest it may reflect behavioural biases inherited from our hunter-gatherer past. Humans tend to over-estimate systematically risks that are systemic or existential to lives and livelihoods.4 This “dread risk” causes excessively cautious behaviour, sometimes with harmful side-effects – as when the exaggerated fear of flying after 9/11 caused more people to drive.5 These exaggerated risk perceptions are often amplified by others’ words and actions. Caution is contagious.

A company that did not have independent directors making up at least one-third of the Board offered the following explanation: “The Board believes that there is an independent element on the Board and that it is able to exercise independent judgment on corporate affairs”. The statement does not provide any evidence or information to shareholders on how the independent element is achieved in spite of the smaller number of independent directors. 11. Companies should provide meaningful explanations of their reasons for deviation, and not opt for “template” disclosures that shed no light on these reasons, or worse, obfuscate the issue. There is scope for standardising the format in which disclosures of compliance with key principles in the Code are made, to facilitate comparability across listed companies. MAS and SGX will be exploring this in the coming months. 12. In strengthening market discipline, disclosure is one side of the coin; the other side is the considered exercise of shareholder rights. Shareholders can play an important role in enhancing corporate governance by studying corporate statements, attending general meetings, and voting on key issues. 13. But the reality seems to be that companies have limited engagements with shareholders on governance issues, and most institutional investors do not vote or attend AGMs. The situation may be improving though, at least in Singapore. According to the CLSA Corporate Governance Watch 2010, institutional investors are becoming more active in voting their shares and engaging with companies in Singapore. 14. Shareholders are not the only people who can exercise market discipline.
While raising interest rates is often portrayed as a difficult task for central bankers, in fact, given the events since the onset of the financial crisis, it would be a development to be truly excited about. Raising interest rates would signal that the U.S. economy is finally getting healthier, and that the Fed is getting closer to achieving its dual mandate objectives of maximum employment and price stability. That would be very good news, even if it were to cause a bump or two in financial markets. Global implications of U.S. monetary policy normalization Let me now turn to the implication of U.S. policy normalization for foreign economies. Like other central banks, our monetary policy mandate has a domestic focus. Our monetary policy actions, though, often have global implications that feed back into the U.S. economy and financial markets, and we need to always keep this in mind. For most of us, the market volatility that we saw in the spring and summer of 2013 during the so-called “taper tantrum” still remains fresh in our minds. EME financial markets were hit the hardest, with declines in equity prices, a widening in sovereign debt spreads and a sharp increase in foreign exchange rate volatility. In the U.S., we saw a spike in Treasury yields, with the 10-year rate rising by more than 100 basis points from early May before peaking in early September.

The fundamental issue is whether U.S. monetary policy has helped support our dual objectives of maximum employment in the context of price stability, and whether this support is consistent with a healthy global economy. Moreover, it is far from clear that explicitly coordinated policy would produce better outcomes for the global economy generally, or EMEs specifically. Central banks face enough challenges in tailoring policies to their own domestic circumstances. I believe that it would be taking on too much to attempt to collectively fashion policy in reference to global conditions. Monetary policy meant to suit everybody is likely in the end to suit nobody. Similar considerations underlie the widespread move in the emerging world away from fixed exchange rate regimes. Policymakers worldwide have learned that a framework capable of responding in a disciplined but flexible manner to changing domestic conditions works best over the long run. While explicit coordination looks neither feasible nor desirable, there is more that central banks in general, and the Fed in particular, could do to be better global stewards. As an example, recent events demonstrate the importance of effective Fed communication. It is clear, in retrospect, that our attempts in the spring of 2013 to provide guidance about the potential timing and pace of tapering confused market participants. Market participants seemed to conflate the prospective tapering of asset purchases with monetary policy tightening, and pulled forward their expectations about the likely timing of liftoff and raised their expected paths for policy rates.
But in the meantime I thought it might be worth us raising our sights a little and having a look at some of the regulatory issues that lie on the other side of the bridge: strong and simple, leverage, MREL and mortgage floors. Strong and Simple I’ll start with strong and simple. Avid followers of my speeches – of which I am regularly assured there are at least three across the country, one of whom is Robin – might recall that in November last year I gave a speech titled ‘Strong and Simple’. Indeed, it turns out that Robin is such an avid reader of my speeches that he has themed this entire conference day as ‘Strong and Simple’! I’m not quite sure what to make of that but I took the hint about what he hoped I’d cover. Let me first remind you that we have already made a significant down-payment in this area. Credit union attendees here today will know that in 2019 we implemented a radical simplification of credit union capital requirements. This aimed to remove barriers to growth while delivering greater resilience for smaller credit unions. It was an example of how regulatory simplification can promote both our primary objective of safety and soundness, as well as our secondary competition objective. Having left the EU and acquired more regulatory flexibility, we have now turned our attention to a simpler prudential framework for the next layer up of our deposit-takers – small banks and building societies.

With more than 25 million members and an average CET1 ratio of more than 26%, the building society sector was well placed to weather the storm from a financial resilience perspective, extending more than £ billion of new loans in 2020 and offering a peak of more than 300,000 payment deferrals to customers in financial difficulty. From an operational perspective, societies also adapted quickly to lockdowns and home-working arrangements, with almost all society branches continuing to serve their members through the pandemic. But the disruption caused by Covid-19 has shown why it is critically important for firms to identify the key services they provide and invest in their resilience. Societies – like all of 1/5  BIS central bankers' speeches  us – have witnessed an acceleration in technology innovation over the last year. Continuing to build on these developments and incorporating them into operating models will be important, both for the sector’s operational resilience, but also for serving the evolving needs of the sector’s members. As we sit here today, the outlook looks better than we might have expected a year ago. But a considerable amount of uncertainty remains, not least as many of the bridging measures put in place by the authorities begin to roll off. Though it may now look less likely, additional financial and operational pressures may still be on the horizon, and we will be monitoring that closely.
Tony Latter: Hong Kong's currency board today - the unexpected challenge of deflation Speech by Mr Tony Latter, Deputy Chief Executive of the Hong Kong Monetary Authority, at the conference on "Alternative exchange rate regimes in the globalised world", organised by Eesti Pank to mark ten years of the currency board in Estonia, Tallinn, 11 June 2002. *  *  *  The conquest of inflation Those of us here today who once studied economics almost certainly did so in a period of at least mild, if not quite rapid inflation. And those of us who are central bankers have for the majority of our working lives been struggling to cope with inflation. So it's hardly surprising that back in 1983, when the Hong Kong authorities pegged the Hong Kong dollar to the United States dollar, we didn't seriously contemplate any deflationary scenario. The US inflation rate in the early 1980s was averaging some 4% pa and, not possessing any special forecasting capability in this field, we must have reckoned that it would remain near that figure. In addition, the textbooks would have told us that structural and developmental factors would tend to make Hong Kong's inflation rate somewhat faster than that of the US - as indeed it was for the ensuing fourteen years. Neither a significantly lower rate of US inflation nor a situation where Hong Kong's rate was significantly below the US rate would have been considered at all likely.

Overall it has, in practice, proved difficult to identify what impact deflation of goods and services prices, of itself, may have had on activity. In general, however, because the degree of downward wage flexibility in Hong Kong is probably greater than elsewhere, the economy is believed to be better able than others to cope with this type of deflationary pressure and to avoid severe distributional disequilibria. Deflation of asset prices is a rather different issue. We have certainly experienced some negative wealth effects, particularly on household expenditure, as a result of the sharp drop in property prices. One factor enabling Hong Kong to live with deflation perhaps better than some other economies is the resilience of the banking system and its ability to cope with debt deflation. A long tradition of fairly conservative prudential oversight of the banks has left them strong enough to weather the recession. Although we have demonstrated that we can live with deflation, a modest positive rate of inflation might nevertheless be preferred to our current modest negative rate. And it would certainly be desirable to avoid gyrations of property prices of the sort which have brought such a sharp deflation there in recent years. However, we do not regard the exchange rate as a viable instrument for trying to dispel deflation. We would not consider it worthwhile sacrificing our long track record of disciplined monetary stability for that purpose.
But when market participants can claim, as David Viniar, the Chief Financial Officer of Goldman Sachs, did in August 2007 that they “were seeing things that were 25-standard deviation moves, several days in a row” it is a sign that something must be badly wrong 4 . Wrong, that is, not with the world, but rather with market participants’ estimation of risk. A particular feature of this underestimation of risk lay in the prevalent assumption that bad shocks were likely to be uncorrelated with each other. Thus the management of Northern Rock probably believed that if they were unable to roll over their short-term wholesale funding in the Asset-Backed Commercial Paper market, then they would always be able to find an alternative source of funds in the inter-bank market. But as it transpired, the same forces that led to a shutting down of the former in August 2007 also led to the closure of the latter at all but very short maturities. By the same token, many investors thought they had purchased relatively safe securities because there were insured against default by the monolines or through the purchase of CDS contracts. But that insurance proved worthless when large correlated losses occurred and the insurers proved to have insufficiently deep pockets. A systemic financial crisis is apt to generate dysfunctions in multiple markets simultaneously, making bad tail outcomes much more likely to occur than they appear when risks are treated as largely independent.

In Minsky's theory of endogenous financial booms and busts, prosperous times lead to an excess availability of credit and the gradual development of credit-fuelled asset-price bubbles. Financial crises result when those debt levels become excessive – a so-called “Minsky” moment. A credit crunch then ensues leading to a downturn in the real economy. Much of what I have said this evening contains echoes of Minsky's theory. As a student at Harvard, Minsky was a protege of Schumpeter, whose teaching influenced him greatly. Schumpeter viewed credit as an essential ingredient of the capitalist machine. He would surely have regretted the downplaying of financial intermediation in macroeconomics over the past forty years. And he would surely endorse the need to rectify that omission now. So let me leave the final words to him: “Credit creation [is] the monetary complement of innovation. This relation…is at the bottom of all the problems of money and credit.” (Schumpeter, 1939, p.111) Bibliography Adrian, T. and Shin, H.S. (2008), “Financial intermediaries, financial stability and monetary policy”, in Maintaining Stability in a Changing Financial System, pp. 287-334. Federal Reserve Bank of Kansas: Kansas City. Aikman, D. and Paustian, M. (2006), “Bank capital, asset prices and monetary policy”, Bank of England working paper 305. Akerlof, G. A. and Shiller, R. J. (2009), Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism. Princeton University Press: Princeton.
In this timeline of measures to preserve monetary stability since 1800, 1848 marks a turning point because, with the opening of branches in Bordeaux and eight other French cities, the Banque de France became the central bank for the entire country, for three reasons: First, it unified local payment systems by creating a single nationwide multilateral settlement system through its branch network. Banknotes then circulated over all the French territory with the same value, and the ability to transfer money between branches slashed and standardised the cost of wire transfers for economic agents. Second, it could perform in each financial centre a single supervision of what was essentially local banking businesses, greatly lessening the financial instability that had plagued France off-and-on between the fall of the Empire and the Revolution of 1848.7 Harnessing its in-depth knowledge of business and banking communities, which was shared between each branch and the head office, the Bank was able to implement prompt corrective actions or step in to ensure the recovery or resolution of struggling financial institutions. Faure, Edgar, 1977, La Banqueroute de Law, 17 juillet 1720, Paris, Gallimard “Trente journées qui ont fait la France” for a complete description of the Law system, and Courtois, 1875, previously cited, on attempts to set up a central bank before the Banque de France. 6 Sargent, Thomas and François R. Velde, 1995, Macroeconomic Features of the French Revolution, Journal of Political Economy, Vol. 103, pp.

We aim to offer young people a useful decision-making framework, ensuring that they have access to reliable, unbiased economic and financial information. We also provide services for local decision makers, notably by providing research analysing cyclical and structural conditions in the regional economies. **** Let me now turn to the current economic situation and explain how monetary policy helps to improve it.10 The fact is, it is not enough to merely set up a framework within which households and economic agents can operate and regions can grow. Serving the economy and society also means guaranteeing monetary stability. Today, inflation is having a severe and unequal impact on many French people, generating costs that they are unable to pay, which is why the Eurosystem’s primary goal is to bring inflation down towards 2%. 10  For a more in-depth presentation of the causes and symptoms of inflation and how it can and will be tamed, see the Letter from the Governor of the Banque de France to the President of the Republic published on 24/04/23. 5  Since resurfacing in 2021, inflation has accelerated at a pace not seen since the 1980s. In March, as measured by the European harmonised index, annual inflation stood at 6.7% in France and 6.9% in the euro area. The initial causes of the inflationary resurgence are well known.
I very much doubt it given the usual time lags observed in the diffusion of past technologies and the differences in productivity levels between firms. The second type of lag, space-lags, refers to the uneven diffusion of technology across firms. Frontier firms usually enjoy stronger rates of productivity growth than imitators in the same sector. In France, the productivity growth of frontier firms has remained steady – or even increased – throughout the slowdown [slide 7]. This may reflect winner-takes-all phenomena. For example, in the digital economy, due to network externalities, one firm with a marginal comparative advantage can seize the whole market and benefit from the low marginal cost of production of additional units of its product. However, these phenomena may be specific to ICT-producing sectors. Productivity growth in frontier firms mostly reflects the actual pace of technological advance and supports techno-optimists views. I’ve shared with you a few thoughts on these three promising hypotheses. To conclude, let me share with you what I see as priorities in order to exit the low growth trap and prevent the risk of secular stagnation. We must obviously accelerate domestic reforms in order to foster innovation and an entrepreneurial spirit. But at the European level, we need to tackle the persistent “investment crunch” which followed the financial crisis. Thus, we first need a “Financing and Investment Union” in Europe to steer abundant savings into investment and provide adequate financing for innovation.

14  BIS Review 133/2010  Barro (2006), “Rare Disasters and Asset Markets in the Twentieth Century” by Robert Barro, Quarterly Journal of Economics, 2006, 121, no.3 Bean, C., Paustian, M., Penalver, A., and Taylor, T.(2010), “Monetary Policy after the Fall”, Federal Reserve Bank of Kansas City Annual Conference, Jackson Hole, 2010. Diamond DW, Dybvig PH (1983). “Bank Runs, Deposit Insurance, and Liquidity”, Journal of Political Economy, 91 (3): pp 401–19. He, Z, I Khang and A Krishnamurthy (2010): “Balance Sheet Adjustment during the 2008 Crisis”, IMF Economic Review, pp 1–39. Kashyap ,K., Stein, J. and Hanson, S (2010). “An Analysis of the Impact of ‘Substantially Heightened’ Capital Requirements on Large Financial Institutions”, Working Paper. McGuire, P M. and Tsatsaronis, K (2008), “Estimating Hedge Fund Leverage”, BIS Working Paper No. 260. Miller, M (1995). “Do the M-M Propositions Apply to Banks?”, Journal of Banking and Finance, vol 19, pp 483–489. Modigliani, F.; Miller, M. (1958). “The Cost of Capital, Corporation Finance and the Theory of Investment”. American Economic Review 48 (3): 261–297. Reinhart and Reinhart (2010), “After the Fall”, NBER Working Paper 16334. Wadhwani, S (2010) “What Mix of Monetary Policy and Regulation is Best for Stabilising the Economy”, The Future of Finance, London School of Economics. BIS Review 133/2010  15
The institution's determination to achieve price stability may not be seriously doubted despite some minor initial inconsistencies in communication. Finally, a danger potential for Switzerland derives from the traditional notion that the Swiss franc is a safe haven currency. The events after 11 September have shown that this notion still plays a certain role. Nonetheless, a mere glance at the map of Europe, on the one hand, and at the integration of the Swiss economy in the euro area, on the other hand, should convince any investor that the Swiss franc could hardly remain immune to a major crisis in the euro zone. 3.3. Implications for the interest rate level in Switzerland  Both nominal interest rates and real interest rates, which are more important for growth, have been relatively low in Switzerland since the First World War. Averaged over the past twenty years, the interest rate spread on money market rates compared with Germany amounted to between 1 and 1.5 percentage points, while the differential between capital market rates came to approximately 2.5 percentage points. This interest differential represents an inestimable advantage for the Swiss economy. The reasons for this so-called "interest rate island" are manifold. First, a lower real interest rate may simply be seen as a reflection of the Swiss franc which appreciates over time.

Hence, the offered exchange rate is generally unattractive, and visitors will almost always be better off converting their money at a bank or using their credit cards. Historically, parallel currencies have only prevailed in those countries that no longer had a sound currency of their own. As long as the SNB continues to pursue a policy that aims at maintaining price stability, the Swiss franc will remain a widely accepted and trustworthy currency. There is no reason to expect it to disappear. By contrast, the declining significance of the Swiss franc as a denomination of foreign bonds in recent years is not primarily due to the creation of the single currency. This trend had already been observable long before 1999. It can be seen as a return to a situation in which the importance of the Swiss franc is more in check with Switzerland's economic size, as compared with its former extremely over-proportional weighting as an investment currency. Certainly, the launch of the euro has not enhanced the attractiveness of Swiss franc bonds, mainly because the market liquidity of euro bonds has grown significantly since 1999. On the other hand, the Swiss franc has gained in stature simply because it is a member of the dwindling family of international currencies. For this reason, we expect it to maintain a role as an instrument of portfolio diversification. 3.2.