samchain/econo-pairs-v1 huggingface dataset:
I would like to spend the rest of my time discussing two of these issues in more detail -- specifically, electronic payments and a Uniform Commercial Code on Electronic Commerce. My interest in these areas reflects my belief that advancements in each are essential to the continued growth of electronic commerce over the Internet both domestically and globally. Users of electronic commerce need safe and reliable payments systems linked to the Internet to facilitate payment for goods and services contracted for over the Internet. More fundamentally, contractual relationships forged over the Internet must have some basis in a sound legal and technological infrastructure. Electronic Payments Over the past few years we have seen the emergence of new technology which allows individuals to pay for goods and services over the Internet and over private networks. These payment methods have developed along two lines. First, technology exists that allows individuals to make payments over the Internet and private networks using traditional payment mechanisms such as credit cards. When used in this way, the Internet is simply the next in an evolving line of communications media used to convey payment information. The underlying payment is governed by the same laws that would govern credit card payments at a point-of-sale terminal or over the telephone. Moreover, and perhaps more importantly from a central banker’s perspective, these Internet payment methods remain tied to existing payments systems involving the transfer of balances among accounts at financial institutions. “Electronic money,” based on stored-value smart cards and other technologies, is also under development.

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Finally, by offering to borrow and lend overnight automatically, the Bank would relinquish day-to-day control over its balance sheet and the degree of risk associated with that. To summarise, there are different models for implementing the policy rate, each of which has its own merits and disadvantages. These reflect both monetary policy and financial stability considerations. A deeper exposition of the arguments can be found in Clews, Salmon and Weeken (2010).8 The Bank has carefully considered the differing systems and expects to return to a reserves averaging system in due course. Presumptively, that would be after increasing Bank Rate and before asset sales began – although the timing and sequencing will depend on the circumstances at the time. In the next section of this paper we explore more deeply some of the financial stability aspects of the Bank’s operations. The Sterling Monetary Framework: providing liquidity insurance Banks inherently engage in “maturity transformation” – borrowing on a short-term basis but lending on a long-term basis (eg taking deposits which can be withdrawn at short notice, and lending for mortgages). As a result, banks take liquidity risk – and even a well-run bank could suffer an unexpected shortage of liquidity. As part of their liquidity management, banks hold stocks of liquid assets that can be used to generate cash or make payments directly. Some assets are expected to retain their liquidity in all but the most extreme circumstances.

Both the US constitution and the EU Treaty were entered into voluntarily and resulted in the closer union of the participating states. Both serve to lay down the level at which powers are to be exercised and decisions taken. BIS Review 61/2001  1  We must understand that the EU's underlying framework, like that of the US, is a product of its times. When the US constitution was drafted, the involvement of the state in economic matters was extremely limited. In fact it was not until over a century later that the US finally had a fully-fledged central bank, after earlier attempts to establish a national bank had ended in the Fed's predecessors being dissolved. By contrast, the process of European integration began at a time when the power of the state in managing and intervening in the economy was high and many thought that this power should indeed be used to a large extent. Let me point out that since the establishment of the European Community, economic integration has served not only as an end in itself, but also as a means of achieving wider objectives, including greater political integration. Progress towards establishing the so-called "four freedoms", namely the free movement of goods, services, capital and labour, required, from the start, the creation of an institutional system with state-like attributes such as a legislative, an executive capacity and judiciary functions. As economic integration has progressed, this institutional system has developed and adapted.
Simon Topping: Basel II - implications for Hong Kong Speech by Mr Simon Topping, Executive Director (Banking Policy) of the Hong Kong Monetary Authority, at the City University of Hong Kong/Oracle Systems Hong Kong Limited “Basel II: Implications for Hong Kong” Seminar, 5 July, Hong Kong. *  *  *  I’d like to start by thanking the City University and Oracle Systems for organising today’s Seminar and for giving me this opportunity to share with you some thoughts on Basel II, and in particular on the implications for Hong Kong. The process of devising a New Capital Accord has now been going on for more than four years and it is still another three and a half years until countries start implementing it. It’s clear from this timescale that what we are talking about here is a very major project indeed, and one which has important implications for the banking industry. It’s very welcome, therefore, to have occasions like this to help spread the word on what it’s all about. But why such a big deal? What’s so wrong with the existing Capital Accord? The answer is simply that, in the 15 years since it was introduced, things have moved on. The nature of banks’ business and the risks they are running have changed dramatically, and the existing Accord no longer comes up to scratch - it no longer functions as a mechanism for ensuring that banks hold an amount of capital that is broadly commensurate with the risks they run.

9  See May 2020 Federal Reserve Financial Stability Report 6  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  6  From where they are today, these highly indebted companies may find equity to be the only – if any – source of finance to minimise the damage to their productive capacity. This leads to the second motivation for equity. Some of these companies may struggle. As will others who were already being challenged by underlying structural shifts in the economy, some of which have probably been accelerated in recent months. A fifth of the companies facing cash-flow deficits had poor profit performance even before the virus disruption. It would always be tough for companies in that position to raise new finance to withstand the disruption. These issues – debt and structural change – mean some companies will be forced to make cuts and some may fail or close. The number of paid employees has fallen by around 700,000 since February10. And we have seen announcements of plans for over 100,000 redundancies. Unemployment and business insolvencies will rise. If we are to limit the extent of economic scarring, new muscle must be created to replace that which is lost. Businesses must be born and be able to grow, to seize new opportunities, create new productive capacity and new opportunities for employment. And that will require new equity.
The American dollar was appreciated in the first part of the year, as a consequence of expectations for a tightening of the United States monetary policy. But, during the second part of the year, the attention of financial markets mainly focused on the structural problems of the American economy, that of the budget deficit and current account deficit. These concerns brought about a quick decrease in the American dollar value, reaching the minimum levels against the common European currency. In face of these developments, both monetary policy and fiscal policy of larger economies maintained expansionist features. Notwithstanding the rise of US dollar interest rates, they remained at low historical levels while Euro interest rates remained unchanged. The fiscal policy has impacted the growth of domestic demand, either in the euro area or in the United States. The progressive integration of the Albanian economy in the international markets of products and capitals makes that this economy benefits from these incentive policies, in the form of lower interest rates for foreign currency and in the form of higher demand for its exports. Placed in this positive background, the Albanian economy growth continues to be generated from the dynamic development of the private sector, while maintenance of the macroeconomic stability and economic growth support through investments in the priority development fields: infrastructure, education and health, have been a priority to the public sector. BIS Review 38/2005  1  During 2004, investments in the economy marked the same level as during 2003, representing nearly 25.4 percent of GDP.

The Government has also reduced its stake in the commercial banks over the most recent years and intends to have them largely or fully privatised by the end of the current electoral term next year. The privatisation process creates opportunities for continued rationalisation in the financial system creating ample opportunities in the period ahead, including closer ties with foreign financial institutions. It is tempting to put recent economic developments in Iceland into the context of developments in some of the other Nordic Countries about a decade ago. Liberalisation of the Icelandic financial markets was more or less completed in the mid-1990s when the last restrictions on the movement of capital between Iceland and other countries were removed. Our liberalisation came a few years later than in the other Nordic Countries. You will recall that in some of the other Nordic Countries, liberalisation was followed by a boom period in the economy, partly or largely fuelled by a rapid growth of credit and in some cases large fiscal deficits. At the same time, these countries were pursuing a fixed exchange rate policy vis-a-vis the ECU. Developments in the domestic economies were such that the fixed exchange rate policy was gradually undermined, the rapid credit growth of banks resulted in weakening loan portfolios when asset prices fell, the exchange rate fixety gave way to floating, the currencies depreciated and inflation rose. The current account of the balance of payments also deteriorated.
The new structure of bank capital regulation will comprise three core elements: First, a foundation of loss absorbing capacity, designed to absorb losses when banks fail so that resolution can take place without taxpayer support or huge damage to financial systems and the wider economy. Second, a central structure of going concern capital requirements, with significant reforms to improve quality and quantity. And third, capital buffers forming a protective roof against rainy days, with higher buffers for systemically-important firms, whose distress would do the most damage, and macroprudential authorities able to increase buffers counter-cyclically when they see storm clouds gathering. In the UK, as in other jurisdictions, we will also use more than one approach to assess the robustness of this structure – with different approaches likely to bind on different firms, depending on their business models, at different times. First, the internationally-harmonised Basel risk-weighted ratio, intended to be risk sensitive and, in our view, with some continuing role for firms’ internal models where we can be confident that they make use of firms’ internal information to improve risk sensitivity in a robust way. That debate continues internationally. Second, the leverage ratio, which weights assets equally as a safeguard against errors in ex ante estimates of risk and prevents excessive balance sheet stretch. In the UK, the Financial Policy Committee (FPC) has recently announced its plans for leverage ratio requirements and buffers.

But we must be alert to the development of new forms of shadow banking, meaning substantial maturity transformation and leverage outside the banking system. The balance of activities may also shift between banks. The post-crisis reforms include additional capital buffers for globally-systemically important banks (G-SIBs), and, as the Governor has said, the FSB is on track to present a proposal for an international standard on total loss-absorbing capacity for these banks, to the Brisbane G20 summit this month. 2 These changes are intended to move G-SIBs further away from distress and to make orderly resolution possible if, nonetheless, they do fail. But it is possible that tougher regulation of G-SIBs might also encourage them to become less systemically-important over time, perhaps with some shift of activity to smaller banks. At this stage, it is too early to tell. And, in the other direction, there are some signs that higher regulatory requirements might be leading to greater concentration of activity amongst the largest firms in certain markets: for example long-term derivatives. That might be consistent with micro-economic theory, which suggests that, in oligopolistic markets with high fixed costs, an increase in marginal costs due to higher regulatory capital requirements may tend to lead to a higher concentration of activity amongst the biggest players (Chart 1). Authorities will need to monitor these trends closely. Within the scope of their business models, individual banks are also likely to change their mix of activities in response to changing regulatory requirements.
33  All speeches are available online at www.bankofengland.co.uk/news/speeches  33  Chart 23: 2019 Bank of England stress test  Chart 24: 2019 Bank of England stress test scenario  scenario overall more severe than the financial  overall more severe than the financial crisis  crisis Latest four-quarter growth (%)  Latest four-quarter growth (%)  2019 stress test start-to-trough fall (%)  2019 stress test start-to-trough fall (%)  UK Residential -33.0 -4.7  UK  UK CRE -40.9  -3.7  2.3  US -4.0  0.9  4.1  Euro area CRE -25.7  6.6  US residential -22.3  -2.8  -34.1  Hong Kong  -1.2  -44.9  5.9 China  -2.6  -10  -3.3  Euro area residential -19.6  EA -7.9  1.6  1.1  World (PPP)  -5  -55.0  2.9  0  -64.0 5  10  -70  3.5  China residential  -50  -30  GDP outturn  2.6 3.4  HK residential HK CRE  11.5  US CRE  -10.4 -10  10 30 Property prices (%)  Our major banks have passed this taxing stress test, just as they did a range of others in recent years. Their resilience contributes to a high degree of financial sector preparedness for the current crystallisation of what had previously been an unknown unknown risk. We haven’t built this strength for its own sake. It’s there to be used when needed. This is prudence with a purpose.

Taking into account the available information, our projections, force of action of the monetary policy transmission mechanism and other financial stability considerations, the Bank of Albania deems that the monetary policy will maintain a similar stimulating direction and range within similar parameters, over the medium term. BIS central bankers’ speeches  3
The fall in oil prices has not deterred oil companies from investing eagerly. Both the central government budget and the current account are in surplus. The Norwegian economy may weather the downturn without any substantial impact on the level of activity or employment, but with a continued risk of high growth in labour costs in the business and public sectors. Economic policy The guidelines for economic policy were revised last year. Henceforth, the real return on the Government Petroleum Fund shall be used over the central government budget. Central government petroleum revenues shall continue to be transferred to the Government Petroleum Fund and invested abroad. Monetary policy shall be oriented towards low and stable inflation. The inflation target is 2½ per cent. When monetary policy is oriented towards stabilising inflation, it also contributes to stabilising aggregate demand and output. The inflation target is the nominal anchor for the Norwegian economy. Low inflation is the objective and the interest rate is the instrument. If it appears that inflation, with unchanged interest rates, will be higher than 2½ per cent, the interest rate will be increased. If it appears that inflation, with unchanged interest rates, will be lower than 2½ per cent, the interest rate will be lowered. Low and stable inflation will be a fixed feature of economic developments. This is something that the social partners, businesses, borrowers and investors in property and securities can take as a given.

The relationship between labour input and future pensions has weakened. The link is especially weak in the contractual early retirement scheme (AFP). For most workers, the annual pension does not depend on when they choose to retire, as long as they are between 62 and 67 years of age. Nor does the age of retirement affect the size of the national insurance benefits after the age of 67. Hence, the earlier an employee retires, the higher the total pension benefit will be. A clearer link between labour input and future pensions may be achieved in a defined-contribution pension scheme. The total pension for individual employees will then be determined by the employee’s contributions and the return on these contributions. The annual pension is determined by the individual’s age of retirement and the total contribution. For every extra year of employment, the employee increases his pension wealth. In addition, the total pension wealth will be spread over a shorter retirement period. This means the longer a person remains in employment, the higher the annual pension will be. 12  BIS Review 11/2002  The main principle is that there should be a clear link between labour input and pensions. Such a link may also be established in a system where the individual receives an annual pension that is stipulated in advance. Sweden has recently implemented a pension reform that ensures that annual pension benefits increase in relation to the number of years the individual has worked.
It would be a mistake, however, to think that we can hope to provide all the knowledge and information needed, at exactly the right times, for individuals to successfully navigate the digital financial landscape. Rather, our job as a financial education community is to help people become comfortable with the language and ways of digital financial services - much like learning how to get around and get things done in a new city. Then individuals will be far better able to adapt to the continual changes brought about by new technologies and empowered to know what to look for, where to look, and how to make sense and use what they find to their best advantage. This is not achieved in one month or over the few days that our teams will be spending in each location on the roadshow. It requires sustained efforts on our collective part to help your customers, the schools and organisations that you work with, and the public at large, build greater confidence in using financial services effectively. 17. Financial education is absolutely central to the goal of making sure that finance works for the people. Today, more than at any time before, our society needs the right  3/4  BIS - Central bankers' speeches  knowledge and skills to manage their finances. Saving for retirement, borrowing responsibly, investing wisely, and protecting against financial harm will build resilient households. Resilient households, in turn, will promote financial stability and healthy economies.

For example, it is not possible to argue at a given monetary policy meeting that “of the 25 basis points I feel the repo rate should be raised, 5 points are aimed at dampening risks linked to household debt and housing prices. The remaining 20 basis points are aimed at stabilising inflation and economic activity in the short run”. Monetary policy decision-making just does not work like this. Moreover, the Executive Board consists of six individuals. Each of them has very likely had his or her own view of what role the risks linked to debt and housing prices have played in their decisions. It is therefore not possible to respond to the question of how much the Riksbank has leaned against the wind with a quantified measure. But what I am quite convinced of is that none of those deciding on the repo rate has had as their main reason, much less their only reason, that monetary policy must lean against the wind. The second question is whether the policy of leaning against the wind has had any tangible effect, given that consideration to risks linked to the development of household debt and housing prices, as I said, has played a fairly subordinate role in policy-making. I am convinced that the policy has played an important role, despite the element of leaning against the wind being much more modest than the critics claim.
BIS central bankers’ speeches  International Monetary Fund (2013a), “The Interaction between Monetary and Macroprudential Policies”, January 29, 2013, http://www.imf.org/external/np/pp/eng/ 2013/012913.pdf. International Monetary Fund (2013b), “2013 IMF Spill-over Report” August 1, 2013, http://www.imf.org/external/np/pp/eng/2013/070213.pdf. Ostry, Jonathan D., Atish R. Ghosh, Marcos Chamon, and Mahvash S. Qureshi. 2012. Tools for Managing Financial-Stability Risks from Capital Inflows. Journal of International Economics 88 (November): 407–21. Rey, Helène (2013), “Dilemma not Trilemma: the Global Financial Cycle and Monetary Policy Independence”, paper presented at the Jackson Hole Economic Symposium, August 2013. BIS central bankers’ speeches  5

When crossborder financial institutions are involved, the systemic risks become even more complicated to manage. This, of course, entails some new challenges for authorities with tasks pertaining to financial stability, i.e. financial supervisors, central banks and ministries of finance. Some of the challenges that I will discuss here today are inspired by discussions that occurred at a workshop that was hosted by the Riksbank in Stockholm in February on the topic of the future regulatory framework for banks in the EU. At the Stockholm workshop some interesting papers were presented by Arnoud Boot, David Mayes, and Charles Goodhart and Dirk Schoenmaker. These papers will shortly be published in the Riksbank’s Economic Review and I can warmly recommend them as inspirational reading. A changing banking landscape All in all, there are roughly around 8 300 credit institutions in the EU today. Among these, of course, the vast majority of banks are small, purely national institutions, with no or almost no cross-border activity. But cross-border banking activities are picking up. There is an increasing number of banks conducting at least some cross-border activities. So far, cross-border retail activities of most banks have been  BIS Review 39/2006  1  fairly limited and typically conducted in subsidiaries. Also these subsidiaries have often been independent and not fully integrated into the operations of the parent bank. This is the type of bank the current system with a home-country control was mainly designed for and is best suited to handle.