samchain/econo-pairs-v1 huggingface dataset:
Speech  Embargo 5 September 2019, 6.00 pm  Currencies, money and digital tokens 30th anniversary of the WWZ and VBÖ, University of Basel  Thomas J. Jordan* Chairman of the Governing Board Swiss National Bank Basel, 5 September 2019 © Swiss National Bank, Zurich, 2019 (speech given in German)  *  The speaker would like to thank Oliver Sigrist for his support in preparing this speech. He also thanks Simone Auer, Nicolas Cuche-Curti, Matthias Gubler, Christoph Hirter, Carlos Lenz and Alexander Perruchoud, as well as SNB Language Services. Page 1/7  Ladies and gentlemen It is a great pleasure, and an honour, to be invited to speak to you today, on the occasion of the 30th anniversary of the University of Basel’s Faculty of Business and Economics (WWZ) and the Vereinigung Basler Ökonomen (VBÖ). I congratulate you wholeheartedly on reaching this milestone. There is a long-standing and close association between the Swiss National Bank (SNB), on the one hand, and the WWZ and the University of Basel on the other. Many SNB economists were trained here and some of our staff regularly give lectures at the WWZ. I would like to thank the University of Basel and the organisers for inviting me to this special event. I am sure that the ties between our institutions will continue to be close for many years to come. For central bankers, Basel is a special place.

We look forward to engaging with our oversight bodies and those appointed under the CARES Act to ensure that the American people understand the steps we are taking on their behalf as faithful stewards of the public trust. 4/4  BIS central bankers' speeches
But before I do, I will give the standard Fed disclaimer that the views I express today are mine alone, and do not necessarily reflect those of the Federal Open Market Committee (FOMC) or others in the Federal Reserve System. Inflation's Disparate Impact The FOMC's price stability objective is for inflation to average 2 percent over the longer run, as measured by the personal consumption expenditures price index. 1 In the three decades before the pandemic, this inflation rate averaged almost exactly 2 percent. But that changed dramatically last year, when inflation suddenly soared. It has reached fourdecade highs in recent months, and now stands at over 6 percent. High inflation spares no one. It makes it more expensive to feed families, heat homes, and pay rents. While everyone feels the pain, not everyone is affected equally. Those who can least afford the essentials-like food, gas, and housing-suffer the most. Inflation also has a disparate impact across ethnic groups. Economists at the New York Fed found that since 2021, Black and Hispanic households have faced higher inflation than the national average-and Hispanic families have been affected the most. 2 This is largely because on average, Hispanic households spend a larger share of their budgets on items most affected by the recent high inflation. 1/5  BIS - Central bankers' speeches  The Inflation Onion The sources of high inflation are many and complex, and they stretch across the globe. Nearly all economies are experiencing unusually high rates of inflation.

5 Board of Governors of the Federal Reserve System, Federal Reserve Board and  Federal Open Market Committee release economic projections from the September 2021 FOMC meeting, September 21, 2022. 6 Board of Governors of the Federal Reserve System, Plans for Reducing the Size of  the Federal Reserve's Balance Sheet, May 4, 2022. 7 Board of Governors of the Federal Reserve System, Federal Reserve issues FOMC  statement of longer-run goals and policy strategy, January 25, 2012. 8 Federal Reserve Bank of New York, Survey of Consumer Expectations. 4/5  BIS - Central bankers' speeches  5/5  BIS - Central bankers' speeches
But we are going to ask more pointedly and regularly than before: how is the pay of that senior manager who is tasked with delivering a major supervisory priority going to be affected by their success or failure in that task? A fourth area is a more traditional battleground for firms and regulators: internal models, where we need to lean against the natural incentive firms have to maximise their room for manoeuvre above regulatory requirements by minimising those requirements. We are keeping a close eye on risk-weights for large UK banks. Average risk-weights have fallen substantially over the past two decades: from over 60% in the 1990s to 31% today. Many drivers are benign 3  All speeches are available online at www.bankofengland.co.uk/speeches  3  – genuine de-risking, in part as a direct result of the strengthening of our prudential framework. But where a reduction is caused by model design or calibration changes firms should expect us to demand strong evidence of a corresponding decrease in real risk. We are also looking at whether parts of our risk-weight framework are too cyclical – in particular for mortgages. These challenges reinforce the importance of having a leverage ratio to complement a risk-weighted regime for bank capital. Nevertheless, the leverage ratio has challenges of its own: we are having a closer look at whether it appropriately captures all forms of secured financing. My last example is more specific to the insurance side of our work.

Peter Pang: The SME sector – an important pillar of many economies Statement by Mr Peter Pang, Deputy Chief Executive of the Hong Kong Monetary and Head of Delegation, at the 44th Asian Development Bank Annual Meeting, Hanoi, 5 May 2011. *  *  *  I would like to thank the Government and the people of Viet Nam for their warm hospitality in hosting this year’s Annual Meeting of the Asian Development Bank. I would also like to take this opportunity to express my deepest condolences to the people of Japan affected by the recent tragic events. The global recovery has gained traction, with emerging Asia in particular rebounding strongly from the global financial crisis. Compared with the last Asian financial crisis, the damage to the real economy of the region was much more contained this time. This is in large part attributable to the reforms taken by regional economies over the years to strengthen economic fundamentals and improve the resilience of their banking and financial systems. In addition, a number of regional economies have also promptly taken temporary extraordinary measures to support their economies and cushion the impact on employment. A number of these supportive measures were targeted at assisting the small and medium-sized enterprise (SME) sector, which is an important pillar of many economies. SMEs play a crucial role in the economic growth and job creation of both developing and advanced economies.
The opposite holds if productivity growth remains weak: unemployment falls more quickly, but we would then also need to begin raising Bank Rate earlier. Shorter-term market interest rates have moved higher since guidance was introduced, but no more so than is justified by a string of unexpectedly strong activity indicators. And there is persuasive survey evidence that businesses have both understood the message (Chart 3), and that it has made them more prepared to hire and invest (Chart 4). In the event, though, unemployment fell rather faster than expected, reaching the 7% threshold in the data release for the three months to February. In anticipation of that, in our February Inflation Report, we provided further guidance, not only on the conditions that would lead the Committee to begin tightening, but also the likely trajectory thereafter. Regarding the first question, while unemployment provides a useful conditioning variable for not tightening, the decision of when to tighten needs to take account of other margins of slack as well. These can arise in both the labour market – for instance, discouraged workers temporarily out of the labour force and those who are underemployed – and inside firms. The amount of slack in an economy is necessarily a fuzzy concept, as potential output cannot be observed and can be inferred only indirectly. Nevertheless, given the transmission lags, monetary policy makers cannot avoid forming a judgement about the level of activity consistent with inflation sustainably remaining at target, and thus of the margin of economic slack.

By depressing the term premium on gilts, the purchases lowered the long-term safe rate of interest. Such purchases also led to lower spreads on risky assets as investors rebalanced their portfolios. In addition, the extra liquidity in the banking system may have helped boost credit supply. Finally, such purchases may also have reinforced market perceptions that policy would remain loose for an extended period – the so-called “signalling channel”. Analysis by Bank staff suggests that the first phase of our asset purchases lowered long rates by around a percentage point; other studies find a similar impact from the Federal Reserve’s asset purchases. 2 The impact of the second round is harder to isolate because some of the effect was probably already priced into the market when the programme was reactivated, but there are good reasons to believe the impact was smaller because markets were less dysfunctional than after the collapse of Lehman’s. There is also considerable uncertainty about the impact on growth and inflation, but our present central assessment is that the programme had a peak impact on GDP of around 2½% and raised inflation by a little more than 1 percentage point. Since the evidence suggests that asset purchases lower longer-term rates and stimulate demand, should they be a permanent part of the central bank’s armoury? Or should they be reserved for emergencies? I think there are a couple of reasons why they should be seen as just an emergency weapon for use when policy rates reach the effective lower bound.
We eventually learned from that experience that there really is no trade-off between growth and employment and inflation, except possibly in the short term, and that stability, defined as consistently low inflation - and achieved by keeping overall demand continuously broadly in line with the underlying structural, supply-side, capacity of the economy to meet that demand - is a necessary condition for sustainable growth. We learned that governments cannot sensibly seek to achieve their social objectives - however worthy they may be - by simply borrowing, or “printing”, the money to finance their expenditures, but need to balance their current receipts and expenditures over the economic cycle, borrowing only to finance productive investments. And we learned that the task of shorter term economic stabilisation was most appropriately left to the operation of monetary policy. That, very broadly speaking, is today’s macro-economic orthodoxy not just across a broad part of the political spectrum in this country but in most of the rest of the world. Now many people were initially sceptical about this change of emphasis - no doubt some still are. Fiscal responsibility, including tight control over all forms of expenditure, for example, on social security and pension provision, and on health and education - and monetary policy directed specifically at consistent stable, low, inflation - all sounds somewhat austere. What in particular does it mean in terms of its impact on the poorer sectors of our society? Well I don’t for a moment suggest it is the solution to all our problems.

According to the new regulation, “the operational target of monetary policy shall be annual consumer price inflation of close to 2 percent over time.” It is not possible to quantify precisely an optimal inflation target for the Norwegian economy. A numerical target of 2 percent is, however, consistent with the inflation target of most of Norway´s trading partners. In 2001, when inflation targeting was introduced, the Norwegian economy faced the prospect of gradually increasing oil revenue spending. It was widely expected that the phasing-in of revenues would entail an appreciation of the real exchange rate. At the time, the nominal target was set at 2.5 percent. An expected real appreciation could then occur partly in the form of wider price and cost differentials between Norway and its trading partners. The period of rising oil revenue spending now appears largely to be over. Thus, it is difficult to find compelling arguments for setting an inflation target in Norway today that differs from that of our trading partners. The new regulation is consistent with how monetary policy has been conducted in practice in recent years. The regulation states that: “Inflation targeting shall be forward-looking and flexible so that it can contribute to high and stable output and employment and to counteract the build-up of financial imbalances.” As long as there is confidence that inflation will remain low and stable, monetary policy can contribute to stabilising the economy.
This is precisely what we try to do in our financial stability reports, which allow us to gain an overall vision of vulnerabilities, although, once again, it does not provide a final verdict. Finally, new financial realities require new sets of information to examine, or to compile when not available. 9 Crisis management That this is the worst financial crisis since the Great Depression nobody disputes. Moreover, the initial shock on the global economy does not differ much from the one that hit in the 1930s. There are many similarities in the initial conditions and effects of the two (Eichengreen and O’Rourke, 2009; IMF, 2009). Worth noting are the initial fall in manufacturing output and trade, the collapse of stock prices and credit, and the increase in bond spreads. In their origins there was also the same rapid expansion in credit and financial innovation that increased the leverage of financial intermediaries. These remarkable similarities in the first months of this crisis were alarming. However, both differ in the subsequent evolution of the global economy. 10 Between 1930 and 1932, world activity (measured at PPP) dropped by an average of 4.8%. In particular, the U.S. experienced an average annual fall of 9.9%.

However, I believe that reduced-form models, with all the caveats regarding their potential misuse, can still help in the design of policy, particularly  1  This must be interpreted with caution, because productivity, which is part of technology, depends on policy changes, especially over the long term. The central point in Lucas’s critique is that one must specify the core characteristics of the economy being studied and not base the research on relationships that change with policies. BIS Review 112/2009  1  when more rigorous and, especially, more realistic models are not available. 2 For this reason, there is always a tension between rigor, realism and flexibility. The tendency to base our models on ever more rigorous grounds has also had undesired effects. The incentives of younger academics – the very ones who are supposed to push the borders of knowledge, and who must publish or perish – limit their capabilities for innovation. The required rigor ends up necessarily threatening realism. Nobody expects a model to explain completely the economic reality, but the problem is that it can overlook elements that are crucial to understanding and preventing disasters like the one we face today. It may be more rewarding from an academic standpoint to write an equilibrium model explaining some particular phenomenon, than trying to formulate a model that formalizes all of the distortions of said phenomenon.
In particular, given the importance of risk management in finance, I hope that French institutions specializing in this area can bring their expertise to this region. Conclusion In closing, the global financial crisis has presented many lessons for the financial community and policymakers. In Asia, the crisis has accelerated structural reforms. There are many challenges ahead, including the development of the financial services sector in appropriate ways to support economic restructuring. I hope that financial institutions in France and Singapore will contribute meaningfully to this development and help bring about a more resilient and robust global economy. I wish Paris Europlace every success in hosting this Forum, and look forward to many more such exchanges in the future. 4  BIS Review 133/2009

The second piece examines the high child poverty rate in Puerto Rico and its impact on the long-term economic sustainability of the island and its ability to recover from Hurricane Maria. The island’s child poverty rate is almost three times higher than that of mainland, and has remained stagnant even during times of economic growth, suggesting the issue is not just rooted in labor demand. This chapter discusses the dual programmatic and policy strategy of the Boys and Girls Club of Puerto Rico and its sister organization the Youth Development Institute. Before I conclude my remarks, I would like to provide a quick overview of today’s sessions. First, my colleague Patrick Harker, President and CEO of the Federal Reserve Bank of Philadelphia, will discuss key shifts in perspective needed to see workforce development as an investment. Then there will be three panel sessions, each dedicated to the overarching focus of a volume in the publication – investing in workers, investing in work, and investing in systems. The day will then end with a luncheon panel discussion where speakers from various sectors will discuss what needs to happen to realize the goal of seeing workforce development as an investment in inclusive economic growth that benefits workers, employers, and communities. I am thrilled that we can bring together national and regional leaders representing the private, public, and nonprofit sectors to engage in a dialogue that can inform workforce development programming across the country and learn from one another about the opportunities for investing in America’s workforce.
The central banks draft, implement, monitor and assess their monetary, micro and macro-prudential policies against the backdrop of a highly integrated and interdependent global economy. On the one hand, integration bolsters economic growth, enabling a more efficient distribution of labour and capital, thus facilitating the transfer of knowledge and of technology, and promotes the adoption of best practices in economic and financial management. On the other hand, experience has shown that globalisation may spill over and amplify negative shocks among the countries, hence creating risks to financial stability, which interfere with central bank mandates. The experience of Albania during the transition period and onward perfectly illustrates these aspects. The Albanian economy has benefited from integration with the global economy; but, recently, we have also been under the pressure from consequences that some of our trading partners experienced due to the financial crisis. Therefore, our response functions have become increasingly complex, relating not only to the adjustment of the domestic product, labour and capital markets to external shocks, but also to the performance of international markets. This reality requires us to be heedful of international developments, and seek common solutions for the challenges we are facing. 1/3  BIS central bankers' speeches  The cooperation, coordination of policies and strengthening of effective dialogue between central banks is an indispensable requisite for drawing advantages from the opportunities arising from economic, financial and technological integration, and enhancing the immunity against the relevant challenges. 2.

Gent Sejko: Intensifying mutual cooperation between Albania and Turkey Speech by Mr Gent Sejko, Governor of the Bank of Albania, at the signing of the Memorandum of Cooperation between the Bank of Albania and the Central Bank of the Republic of Turkey, Tirana, 6 November 2017. * * * Honourable Governor Çetinkaya, Your Excellency Ambassador Bayraktar, Dear members of the delegation from the Central Bank of the Republic of Turkey, Dear guests, Ladies and Gentlemen, I have the pleasure to have the Governor of the Central Bank of the Republic of Turkey, Mr Murat Çetinkaya, as our guest on a one-day visit to the Bank of Albania, on the occasion of the signing of a Memorandum of Cooperation. This memorandum is an expression of our common will and desire to continue and intensify the mutual cooperation that has been already in place for years. Opening addresses are supposed to be brief and I would rather not break with such tradition. However, I find it appropriate to share with you some thoughts on: (i) the international context surrounding the signing of this memorandum; (ii) the current level of the bilateral relations between Albania and Turkey; and, (iii) the main aspects of future cooperation. 1. International context Our institutions – the respective central banks – play a significant role in promoting and guaranteeing monetary and financial stability, supporting the sustainable development of our countries and the welfare of our citizens.
As a consequence, the return on capital is relatively low and wages are comparatively high, particularly so for unskilled labour. We thus tend to specialize in capital intensive and high-value added activities. External shocks tend to impact on us in a way that is not quite the  BIS Review 72/2004  1  same as on the rest of Europe. Moreover, we also have to cope with home-brewed shocks. It is for these reasons that we are eager to keep an autonomous monetary policy. Furthermore, if markets became convinced that in the future the SNB’s actions would simply mimic those of the ECB, they would rapidly force a convergence between Swiss nominal interest rates and those of the eurozone. Our real interest rates might remain lower for a while, given our relatively large supply of physical capital, but a tendency towards equalization would nonetheless set in. What this might mean for us is a higher rate of inflation for some time, together with a collapse in asset prices and in domestic gross capital formation. A mixture of higher interest rates and high, sticky wages would be very harmful to our economy. The third fear that was sometimes expressed, although here I must say I was rather sceptical myself, was that the euro would gradually render the Swiss franc obsolete. With many of our trading firms billing and paying their suppliers in euros, there might be a tendency for them to adopt the euro more generally for their accounting as well as for their domestic transactions.

As we have seen, movements in the dollar/mark exchange rate were magnified as far as the Swiss franc is concerned in the past, but are much dampened since the birth of the euro. When the euro depreciated against the dollar at first, the Swiss franc did so too, but to a much lesser degree. And later, when the euro recovered against the dollar, the franc appreciated as well, but again to a lesser extent. In order words, our effective exchange rate has been less affected, the movement of the dollar being offset, at least to some extent, by a movement of the euro in the opposite direction. It seems to me that this phenomenon has benefited not just Switzerland, but also many other countries with their own independent currencies, such as the United Kingdom, Canada, Australia, New Zealand, Singapore, and Norway. I would be very curious to know what your experience has been in this respect. This evolution might not last. Perhaps it is the outcome of chance, but it has been sufficiently persistent over the past few years to be noticeable. Maybe one day some bright graduate student will write a thesis on this topic, and confirm or falsify my hypothesis, but in the meantime let me outline why I think that there are some good reasons to believe that the stability of the international monetary system has been enhanced by the creation of the euro.