samchain/econo-pairs-v1 huggingface dataset:
Much of the Fed’s ability to respond as effectively as it did during this crisis, whether it was from a monetary policy, a “lender-of-last resort” or a supervisory perspective, came from its breadth and depth of knowledge and experience with financial institutions, financial markets and financial market infrastructure, both inside and outside of the United States. That said, there is also no question that the Federal Reserve and other regulators could have done more to prevent this crisis. That is why, even as the Fed has engaged in extraordinary efforts to stabilize the financial system over the past couple of years, it has also been moving quickly to make the internal changes necessary to strengthen our effectiveness. In addition, the Fed has been working with other regulators in and outside of the U.S. to craft and implement the broader changes in regulation and supervision that are necessary to make our financial system more robust and resilient going forward. Turning to the outlook, the recession now appears to be over, but the economy is still weak and the unemployment rate is much too high. These circumstances underpin the FOMC’s commitment to keeping short term rates exceptionally low for an extended period. However, at the same time, it deserves emphasizing that the Federal Reserve will be willing and able to exit from this period smoothly when the time comes to ensure that inflation stays low and inflation expectations well anchored.

Such instruments might have proven very helpful had they been in place before and during this crisis. Investors would have anticipated that common equity would be replenished automatically if a firm came under stress, and this knowledge might in turn have tempered anxieties about counterparty risk. At a minimum, contingent capital instruments might have enabled common equity buffers at the weaker firms to be replenished earlier and automatically, thereby reducing uncertainty and the risk of failure. There are many details that still need to be worked out to determine the potential for contingent capital instruments to enhance financial stability. For example, what are the circumstances under which conversion is triggered? How much common equity do debt holders receive upon conversion? However, our early work on this issue suggests that contingent capital may be a promising mechanism for injecting common equity into the banking system in times of stress without unduly raising intermediation costs or pushing financial activity out of the banking sector into the unregulated sector. On the liquidity front, there are a host of initiatives underway. For starters, the Federal Reserve is now supervising most of the holding companies of the systemically important financial institutions. That was not true at the start of the crisis.
Another way to promote creativity is to create a facilitative environment for public private partnerships provides the best prospects to drive innovative strategies. With advances in technology, the scope and potential for such partnerships have increased exponentially. We see this in partnerships between mobile network providers and financial institutions in sharing data which can increase financial inclusion among borrowers that do not have a prior credit history. Partnerships that leverage on e-marketplaces and social media platforms also have enormous potential to increase the reach and development impact through the deployment of innovative strategies. Enhance corporate governance For many institutions, the ability to significantly increase their impact is closely tied to issues of corporate governance. Narrowly defined financing targets and links between business and Government have led to suboptimal resource allocations, increased moral hazard, and market 3/4  BIS central bankers' speeches  distortions. These can pose a drag on the economy and the overall development agenda. Broader confidence can also take a hit on suspicion of undue preference in extending financing, making it more difficult to mobilise resources for development. The critical appraisal and monitoring functions are largely shaped by the strength of its corporate governance. These require competent and professional boards to be installed, clear rules of engagement with their stakeholders, and stronger performance management standards that are aligned with development outcomes.

Indeed, we expect that given their mandates, they would lead in demonstrating how commercial principles can be fully reconciled with responsible finance and public interests. There are many instances where development financial institutions can play a catalytic role in economic development. They can open new frontiers in discovery and exploration; accelerate poverty eradication and mitigate global climate change. This ought to be a noble aspiration. We share a common vision for them to contribute towards the growth potential of our economies and consequently improve the wellbeing of the people. We have an excellent program ahead to help us move in this direction. I hope it will sow the seeds for individual and collective actions that will both transform development financial institutions and enhance their impact. 4/4  BIS central bankers' speeches
Caleb M Fundanga: Media relations and the Bank of Zambia – a healthy interaction Speech by Dr Caleb M Fundanga, Governor of the Bank of Zambia, at the official opening of the Bank of Zambia 12th Media Seminar, Ndola, 5 October 2007. *  *  *  • The Chairperson • Distinguished Journalists • Invited Participants • Ladies and Gentlemen On behalf of Bank of Zambia and indeed my own behalf, I am pleased to welcome you all, to this Bank of Zambia sponsored annual seminar, which is the 13th in the series. Further, it is also my great pleasure to welcome you to the City of Ndola. Ladies and gentlemen, as it is normally the case, some of you are participating for the first time. For those of you that are participating for the first time, let me inform you that this is your seminar and I urge you to participate freely and effectively. I know that your friends who have participated in the seminars before, will agree with me that, every year that we meet at such a forum, we meet as “partners” and it is certainly in the interest, of not only us gathered here but the nation at large that this spirit is exhibited through out this seminar, and beyond. In fact, let me thank the media for having embraced this partnership and worked towards maintaining it. The Bank of Zambia-Media relations have been quite healthy, partly due to annual interaction through Media Seminars.

For example the National Payment Systems Act which was enacted in 2007 gives powers for the Bank of Zambia to regulate and oversee operations of payment systems to ensure the effectiveness, efficiency and safety of payment systems so as to promote the stability and safety of the Zambian financial system. Further, the Bank of Zambia through the National Payment Systems Vision and Strategy 2007–2011 and the Financial Sector Development Plan, has undertaken various activities that are focused on improving access to financial services for both the banked and unbanked population. You may recall the Topline findings by Finscope on our financial sector development systems and their recommendation to expand access to financial services to the unbanked population in remote areas. The launch of Airtel Money is expected to contribute positively to the financial inclusion agenda which in turn will have a positive impact on the economy at large. In addition, the Bank is in the process of putting in place Electronic Money Regulations that will ensure that e-money transactions are operated within safe, efficient and secure bounds. Distinguished guests, allow me to also comment on the recent B+ sovereign rating assigned to the country by world renowned rating agencies Standards and Poor and Fitch, as well as, the reclassification of Zambia as a middle income country by the World Bank. The rating and reclassification requires the central bank, the Zambian business community and Government to continue enhancing the financial system to ensure that it is robust and reaches the unbanked.
The setting of working and wage conditions having regard to general or sectoral criteria, without taking into account the specific situation of each company, has been one of the main causes of our structural imbalance in terms of employment, and one of the factors that explains why Spain has always, even at times of greater economic activity and higher growth, had a far higher unemployment rate than the euro area, and indeed the European Union, as a whole. It will not be possible to reduce our structural unemployment rate in a collective bargaining framework that does not take into account productive, commercial and cost conditions, that is to say each firm’s conditions of competitiveness. The duality of our labour market – whose adverse effects on productivity, on decisions regarding investment in human capital and on collective bargaining itself nobody denies – cannot be scaled back if there continues to be a major imbalance between the labour costs (including firing costs) of permanent jobs and of temporary ones. Moreover, it is unlikely that we can manage to reduce duality and, in turn, to increase total employment – which must be the main priority – simply by raising the labour costs of temporary employment. 2. The reduction of public debt  Our second challenge is to contain the growth of public debt and, then, to reduce its volume.

First and foremost, this PvP link will help eliminate settlement risk in US dollar-Thai Baht foreign exchange (FX) transactions. Prior to this link, the settlement of the two currency legs was done in different time zones and in an uncoordinated manner – Thai Baht (THB) in the Asian time zone, followed by US dollar (USD) during New York hours. With the new PvP link, all payments can be made within the Asian time zone and in a coordinated manner by adopting the PvP mode. Under this arrangement, when a Thai Bank delivers (or receives) THB to (or from) its counterparty in Bangkok, the correspondent bank of the Thai Bank in Hong Kong receives (or delivers) USD at the same time. Hence, the risk due to time lag in settling the two legs of the FX transaction can be removed. 5. Second, the reduction in FX settlement risk will open up new business opportunities for banks in both Thailand and Hong Kong. USD against THB transactions accounted for about 75% of Thailand’s FX transactions in 2013. Through this link, banks in Thailand can benefit from the highly flexible and cost-effective solution offered by the USD RTGS system in Hong Kong for managing the settlement risk of their USD FX transactions. The seven-and-a-half-hour PvP window offers a high degree of convenience to the system users.
The banks’ trust in other banks dropped to a level where interbank lending almost came to a complete halt. Confidence and credibility is the core in money and finance. What good is a 100 dollar note if there is no trust in its worth to buy 100 dollars of goods and service. When confidence and credibility have been destroyed it may take a long time before they are restored. An example from Norwegian monetary history illustrates this. The example is from the time of the birth of Norges Bank. The successful establishment of Norges Bank in 1816 played a key role in stabilizing the external value of the Norwegian currency after the chaos following the Napoleonic wars in Europe. The previous joint currency with Denmark had collapsed and two attempts to restore the currency based on broad guarantees had failed, first from the Danish government in 1813 and second from the hastily called Constitutional Assembly in 1814. The successful restoration of credibility in the Norwegian currency was finally brought about by the establishment of Norges Bank, but it took a long time. Norges Bank was in full operation already in 1818, but since the Parliament postponed the decision to reintroduce silver convertibility, the value of the notes continued to fall until the Parliament changed its strategy in 1822. In this year a course to reintroduce silver convertibility was set. Convertibility was introduced, first at poor (low) rates far from silver parity, but as confidence improved the convertibility rate was gradually moved closer to parity.

However, while it may be necessary to take active policy measures in the short run to solve the crisis, it is equally important to learn from historical lessons of the past so we can be better prepared for the future. Why are we here? Why has Norges Bank taken the initiative to this workshop? To answer this we have to turn the clock back to the time of the birth of Norges Bank right after the end of the Napoleonic wars in Europe. Six laws about the Norwegian monetary system, passed by the Norwegian Parliament in 1816, paved the way for the establishment of Norges Bank. The Norwegian Constitution of 17 May 1814 specified that the Parliament should oversee the monetary system but made no explicit reference to a central bank. The Constitution was modified in November 1814 after Sweden showed some military muscle to enforce the Treaty of Kiel. The revised Constitution was in place on 4 November 1814, and the main changes reflected the fact that Norway had entered a loose union with Sweden under a common King. A change, often overlooked, was that a new paragraph had been added which explicitly stated that Norway should keep its own bank and monetary system. Hence the Norwegian Parliament preserved an independent legal authority to decide on Norway’s monetary system and institutions under the union with Sweden. Norges Bank is thus celebrating its 200-year anniversary in 2016 and has announced ambitious targets for its Bicentenary Project.
-  We may also be prepared to relax our capital requirements for an acquiring bank on a strictly temporary basis provided that there are firm and credible plans by the acquirer to raise new capital. This would only apply where, for good reasons, the timing of the acquisition cannot coincide with the timing of the issue of capital. Conclusions To summarise, consolidation offers the banks, and perhaps especially smaller institutions, the opportunity to achieve cost reductions and revenue enhancements. This is not, however, something that can be taken for granted, and there will always be a certain element of execution risk. This is one of the reasons why it is difficult for banking regulators, like the HKMA, to take a heavy-handed approach towards mandating consolidation. Rather, proposals should emanate from the industry itself based on careful examination of strategic fit and quantification of the benefits that will flow from the merger or acquisition. While the local banks are not under immediate pressure to consolidate, we believe that this is an issue that they should keep under close and continuing review. 4  BIS Review 49/2001

Among other things, there was considerable uncertainty surrounding trade tensions between the US and China and the UK’s withdrawal from the EU. Despite somewhat lower growth, unemployment continued to edge down in many countries. US unemployment is now the lowest in 50 years. Consumer price 1/3  BIS central bankers' speeches  inflation among trading partners picked up in 2018, mainly owing to higher energy prices. Underlying inflation was fairly stable among our main trading partners. Chart: International interest rates Official policy rates in the US, UK and Sweden were raised in 2018. The US federal funds rate has been raised in several steps in recent years, and the target range is now 2.25 to 2.5 percent. Nevertheless, the global interest rate level remains low, and market expectations indicate a low level in the years ahead. In the euro area, there are prospects that the ECB deposit facility rate will be negative for some time to come. Chart: Oil prices and the krone exchange rate The tailwind from the rebound in oil prices has provided a considerable boost to the Norwegian economy in recent years. Oil prices have more than doubled since the low in early 2016. In 2018, oil prices were highly volatile in periods, primarily reflecting supply-side conditions. Towards the end of 2018, uncertainty about global economic prospects had a dampening impact on oil prices. After rising to above USD 85 per barrel through autumn, oil prices fell to below USD 55 per barrel at year-end. Prices have edged up again since then.
Over the last decade, as the geographic dispersion and size of lending portfolios grew at large banks, and amid intense competition, reliance solely on expert judgment in the evaluation of the risks of retail exposures became less and less plausible. Banks developed, and continue to enhance sophisticated scoring systems to better express the likelihood of repayment of individual borrowers, and have grown increasingly sophisticated in their ability to segment exposures by characteristics that provide a fine classification of the risk of a homogenous pool of borrowers. Basel II allows banks to build off of these practices, bringing regulatory capital requirements into much closer alignment with internal economic capital estimates. Importantly however, this occurs only when banks use those models for risk management purposes - ensuring their continuing effectiveness. A key element of Basel II is that it establishes rigorous standards for data collection and the systematic use of the information collected. The greatest challenge for the industry, and the greatest potential long-run benefit, involves the collection and categorization of accurate, detailed information on borrower and exposure characteristics and exposure performance. This involves significant investments in technology, and for some firms the revamping of historical underwriting practices. Enhancements to technological infrastructure and MIS, combined with detailed, granular data will, over time, prove a powerful combination allowing firms to better price exposures and manage risk.

The credit cycle and monetary policy The knock on effects of defaults in the US sub prime market and the impact of big investors on asset prices are factors we need to assess not just in trying to understand the financial sector and the stresses it faces but in gauging the state of the economy more widely. The story of the sub prime market illustrates a wider point. In traditional banking markets in the past there has been an observable tendency for banks to overshoot both in offering credit at the top of the cycle and retrenching afterwards. That feeds through into asset prices and can have an impact on the wider economy. Despite the sophistication of the new capital markets, a very traditional cycle seems to have been alive and kicking in sub prime. 3  The definition of the official sector in the US Treasury survey also includes public bodies such as oil stabilisation funds. 4  See ‘International capital flows and US interest rates’, NBER working paper 12560, October 2006. 6  BIS Review 84/2007  A similar story could be told about the credit card and other unsecured lending over the last few years. The growth rate rose in the late 90s until defaults began to build up over the last 2 years and the banks and other lenders tightened up terms and conditions sharply (Chart 13). The path of commercial property prices in recent years suggests the same has been happening there (Chart 14).
The broader objectives of the reforms were to reduce transaction costs, increase efficiency, ensure safety and reduce credit, liquidity and systemic risks. Payment modes are wide ranging. Cash is the common mode of payment, because it has a finality in settlement of a transaction and is readily and legally acceptable as a medium of exchange. However, the inconvenience of carrying cash and increased security threats have encouraged the move towards other payment media. Non-cash payment modes are considered to be more secured payment instruments, but paper-based instruments like cheques, drafts and travellers cheques are also not so convenient instruments. In modern times, card and electronic payments are treated as the most convenient and safer instruments, although they too are subject to certain risks, card frauds in particular and technology related issues. There are two systemically important payment systems in Sri Lanka. They are the high value and time critical payment system used by banks, primary dealers, the Central Bank and the corporates and the cheque-based retail payment system which is used by all segments of the population. Reforming these two systemically important payment systems were necessary to mitigate settlement risks, increase efficiency and enhance accessibility. The reforms were also in line with the public policy objectives which require attention of the Government and regulatory authorities. BIS Review 66/2006  1  The implementation of the Real Time Gross Settlement System (RTGS) and the Scripless Securities Settlement Systems (SSSS) with a SWIFT link was the most significant reform effected in recent times.

Policy clearly within our mandate Another argument that I think is fairly difficult to understand is that the Riksbank, because of the policy we have conducted, should have acted beyond our mandate and done something we should not have done. Sometimes it has been claimed that we have introduced a new target for monetary policy or that we have begun to conduct housing policy. Had we only kept to our task, monetary policy would have been more expansionary, we would have come  2  See Svensson (2013). 3  I discuss this question in greater detail in Jansson (2013). BIS central bankers’ speeches  3  closer to attaining the inflation target and everything would have been much better, the story goes. But as I have already said, the purpose of the policy conducted in recent years has been to create the conditions for a sustainable development in the Swedish economy by reducing the risk of excessive debt and inflated housing prices. After a number of years of rapidly-rising house prices and a build-up of debt among households, it became clear in many countries that developments were based on overly optimistic calculations. When housing prices fell, household assets declined in value rapidly, but the size of the loans remained the same. Households in this situation have reduced their consumption and begun to save to achieve a better balance between assets and debts.