samchain/econo-pairs-v1 huggingface dataset:
Recently the discussion of this issue has finally got going. My view has been that it is not just a question of economics, though the economic arguments do point to participation. EMU is one important component of the EU cooperation in which Sweden is now taking part. From the debate about economic aspects of EMU one sometimes gets the impression that an alternative exists which is much simpler, enabling us to avoid all the adjustments which Brussels imposes. That is not the case. Sweden has experienced a profound economic crisis in the 1990s that was essentially self-inflicted. Development in the rest of Europe has on the whole been better. We must now in any event continue to consolidate government finance and establish long-term confidence in the stability of Swedish economy. This will scarcely be easier outside EMU. I find it hard to envisage that Sweden would ultimately want to remain outside a functional EMU. Bit by bit the countries of Europe will grow together. This makes the question not whether but when Sweden ought to join. Perhaps this perspective can help to make the question less dramatic. In our efforts to prepare the financial sector for EMU we can see that the work has come a long way. We also meet a strong desire from the parties concerned to get going as quickly as possible so as not to fall behind; so as to compete on the same terms as other European enterprises and not lose business opportunities.

Mojmír Hampl: Central bank independence in practice - the case of the Czech Republic Speaking points by Mr Mojmír Hampl, Vice Governor of the Czech National Bank, at the Annual Research Conference of the Central Bank of Ukraine, Kiev, 1 June 2018. * * * Ladies and Gentlemen, Before I begin my talk in earnest, I would like to thank the organizers for inviting me to this inspiring event. It is an honor to participate in such a distinguished panel. And it is a particular pleasure for me to visit Kiev, one of the great historical pivots of Europe and also a city with immense economic potential. The latter, I believe, can be said about Ukraine in general. The topic of this panel and the entire conference is monetary-fiscal interactions. This is an important issue, and I am convinced that a good working relationship between the central bank and the government is imperative for the proper counter-cyclicality of economic policy. My intention today, however, is to offer a related but cautionary tale. I will talk about central bank independence, with an emphasis on the experience of my own country. Few economists nowadays doubt the importance of central bank independence for achieving price stability. For example, the latest meta-analysis of this research question summarizes 300 empirical estimates from dozens of studies and finds strong evidence that independence is crucial for delivering low inflation (Iwasaki and Uegaki, 2017). This finding holds for both developed and emerging economies, as the authors clearly show.
Given the inflation target, we will be mindful of the effects of higher interest rates on the krone exchange rate when inflation is low. Nonetheless, the interest rate path published in Monetary Policy Report 1/07 was higher than in Inflation Report 3/06. The reason for this is that the prospect of stronger-than-expected growth in both Norway and among our trading partners pointed to a higher interest rate path. On balance, this had a greater impact on the interest rate path than a stronger krone. Over time, however, the nominal exchange rate is not the main force. The most important influence on competitiveness in Norwegian business and industry and the purchasing power of the Norwegian krone is changes in the real exchange rate. The real exchange rate can be measured in a number of ways, for example by consumer prices or labour costs in Norway relative to our trading partners measured in a common currency. The real exchange rate has fluctuated widely over time and has deviated over longer periods considerably from the average level since 1970. The real exchange rate has nonetheless shown a tendency to revert to this level. Over time, the exchange rate acts as a buffer in the global economy. When economic activity is high in one country, an appreciation of the country’s exchange rate will have a dampening effect. Conversely, when there is a need to stimulate the economy, a weaker exchange rate will boost growth.

Disturbances to the economy may result in changes in the forecasts. Data revisions imply that the current economic situation is  BIS Review 97/2007  3  not fully known. Our ambition must be to reduce uncertainty with regard to our own response pattern. That actual interest rate developments will deviate somewhat from the Bank's forecast will probably be the rule rather than the exception. What Norges Bank’s Executive Board actually adopts is a monetary policy strategy that applies until the next Report. When Monetary Policy Report 2/07 was presented in June, the Executive Board decided that the key policy rate should be in the interval 4½-5½ per cent in the period to the publication of the next Report on 31 October. And even that is conditional on economic developments that are broadly in line with projections. Financial market turbulence Global economic developments are important for economic developments in Norway, and changes in the growth prospects for the world economy may influence our projections. The turbulence in international financial markets in recent weeks has heightened the uncertainty concerning developments ahead. The source of the turbulence can be found in the US housing market and particularly in the subprime mortgage market. This segment of the US credit market has expanded sharply in recent years. The loans often feature an interest-only period and low interest rates in the first years of the loan's term and higher interest rates thereafter.
To a greater extent than with SPE, a MPE resolution can be impeded by financial connections between different parts of the group, whether arising from intergroup loans or from business lines, such as global payment services, that are integrated but spread across different legal entities. In supporting MPE as a preferred strategy, the home and key host resolution authorities will have to satisfy themselves robustly that such interlinkages would not impede resolution via splitting up the group. In practice, that will mean reducing intragroup exposures. Operational dependencies between different parts of the group are another priority where MPE is the preferred strategy. For example, some global commercial banking groups seek to exploit economies of scale and scope by drawing on centralised operational services (in particular related to IT and processing). MPE does not work unless those arrangements can survive the breakup of the group. At the very least, that entails service-level agreements and  12  FSB Key Attributes paragraph 7.4: “National laws and regulations should not discriminate against creditors on the basis of their nationality, the location of their claim or the jurisdiction where it is payable. The treatment of creditors and ranking in insolvency should be transparent and properly disclosed to depositors, insurance policy holders and other creditors.”  13  See FDIC and Bank of England (2012), Resolving Globally Active, Systemically Important, Financial Institutions. 8  BIS central bankers’ speeches  transitional support arrangements being effected via enforceable contracts.

‘Bailin’ is a verb not a noun. Orderly resolution will not be achieved by drafting term sheets. 6  BIS central bankers’ speeches  Looking back on the 2007–2009 part of the crisis, those precepts should have been in place anyway. In the UK, it was alarming that many medium-sized domestic banks had been allowed to hold each other’s bonds in what were purportedly ‘liquidity’ portfolios.9 Contagion (2): the creditor hierarchy and depositor preference Preparations for bailin, and even more the recent reconstruction of Cypriot banks, have heightened awareness of the prospect of creditors of distressed banks losing money, prompting calls for clarity about the relative standing of different types of creditor. Who stands where in the creditor hierarchy affects the loss they incur in the event of default, and therefore their behaviour before default, including the return they demand to compensate for risk and whether they flee at the first signs of the firm weakening. Insured depositors are insured, pure and simple – they are covered by the relevant Deposit Guarantee Scheme. The details of the resolution regime do not affect that.10 Nor does preference for insured deposits affect those depositors directly.
For those with a long enough memory, this time’s recovery is likely to feel quite anaemic, relative to those in the past. A second potential explanation may lie in the fact that aggregate activity measures are sometimes a poor proxy for the average person’s income. GDP is a measure of the size of the economic pie, a pie that has grown substantially larger since 2009. But so too has the number of people eating it. Taking the two together, GDP per head has risen significantly more slowly than aggregate GDP since 2009. Indeed, GDP per head today is only around 1% above its pre-crisis peak (Chart 3). GDP measures income from all UK-based activities. But not all of that income flows to UK citizens. Some flows abroad to foreign owners of UK assets and some income is earned domestically on UK investments abroad. The amount of net income flowing overseas currently stands at around 3% of GDP. This is a record high. If we take net overseas income out of GDP, to give a measure of net national disposable income per head, it has recovered even more slowly than GDP per head. It is currently at levels little different than its pre-crisis peak (Chart 3). National income per head suggests there has scarcely been any recovery. Moreover, not all the income earned nationally flows directly and immediately to households. For example, some accrues to companies who may save it rather than distributing it to households as wages or dividends.

In addition, managers should have at least three of those five years of experience managing funds of hedge funds if they offer this product. Redemptions of retail hedge funds need only be made once every quarter. This is an accepted international practice. Managers who want to provide for more frequent redemptions are free to do so. Redemption procedures should be prominently disclosed. To facilitate the entry of foreign funds of hedge funds, there will be a flexible diversification rule. The rule will require any fund of hedge funds to be diversified either across 15 hedge fund managers or by having not more than 8% of its assets allocated to a single hedge fund manager. This would enable foreign funds of hedge funds to benefit from an earlier liberalisation introduced by the SFA in July this year, which allowed all recognised foreign funds (including hedge funds) to be offered directly to Singapore investors instead of only through feeder funds previously. For a foreign fund to be recognised by MAS, the foreign offeror needs only to register a foreign company in Singapore and appoint a representative to act as a liaison for investors. The fund and its manager should be from a jurisdiction with acceptable regulatory standards. While providing for direct offers of foreign funds into Singapore, the alternative feeder fund structure is still available. A Singapore fund of hedge funds can therefore feed into a foreign fund of hedge funds.
Mugur Isărescu: 15th Anniversary of the 2004 EU Enlargement looking back, looking forward Opening speech by Mr Mugur Isărescu, Governor of the National Bank of Romania, at the conference on the 15th Anniversary of the 2004 EU Enlargement: Looking back, looking forward, National Bank of the Republic of Austria, Vienna, 8 April 2019. * * * Governor Nowotny, Distinguished audience, Ladies and gentlemen, I am greatly honoured by the invitation to address this audience at a time when we celebrate the 15th anniversary of the first wave of EU enlargement. This event gives me yet another opportunity to say a few words about Romania, a country that I know very well. Romania was a second wave country, the same as Bulgaria, but I am familiar with the case of the first wave countries because I watched their course of development and I must say they paved our way to EU membership. I will look back at Romania’s journey on the path of European integration, while also reminiscing the entire transition from communism to democracy and from a centralised economy to a market economy. I believe discussing this subject is useful, since the lessons and challenges of the past have been quite numerous and some of Romania’s peculiarities might be relevant for other countries.

Moreover, the delays in the restructuring or privatisation of state-owned companies paved the way for high levels of arrears. Acting as surrogate money, they undermined monetary policy restrictiveness and fuelled inflation. In addition, the disequilibria manifest at the level of the current account could be adjusted only by purposely resorting to the exchange rate, whose depreciation generated inflation as well. As a matter of fact, other countries which, during one transition stage or another, had slowed down the engines of economic restructuring were also faced with such issues, recording a more modest macroeconomic performance. Going back to the comparison with Poland, I deem it relevant that the output loss associated with the structural changes implied by the transition to a market economy was fully recovered in 1995 in Poland, whereas in Romania this occurred a hefty nine years later. Now, it is almost two decades since Romania – EU accession negotiations had been opened. Back then, in 2000, I served as prime-minister. In fact, I think I may say that my entire prime2/5  BIS central bankers' speeches  ministership in 2000 was dedicated to laying the groundwork for Romania’s accession to the European Union. And it is worth noting that, if Romania managed to join the EU on 1 January 2007, all the inherent stumbles notwithstanding, the preparation process started in 2000 was essential. And it would have been dramatic if this start had been missed.
Just before Christmas, “Storm Barbara” hit the UK, causing widespread devastation to as many as a dozen umbrellas and blowing off several people’s hats. Yet advance warnings of Storm Barbara inspired  67 68 69  See Kahneman (2011) and Shiller (2017) for examples. See Thaler and Sunstein (2008), Adams and Hunt (2013) and Halpern (2015). For example, Haldane (2016). 20  All speeches are available online at www.bankofengland.co.uk/speeches  20  81,000 tweets and 4,000 retweets. Polling by YouGov suggests that, since storms began being named, more than half of people have begun taking steps to prepare themselves. Storm-naming in the UK follows long-standing US practice of naming (very much more) extreme weather events. This began back in 1953. The evidence is that naming these events has increased significantly public awareness. Even the names matter. The death toll from female-named hurricanes in the US is higher than for male-named ones, even once storm-severity is taken into account. 70  Had “Storm Barbara” been  “Storm Brian”, several items of apparel may have been alive today. I am not suggesting central banks should start following this meteorological precedent to the letter. I am not sure naming the next sharp downturn in activity “Recession Andy” (much less “Depression Andrea” given the meteorologists experience with female names) would necessarily raise public awareness greatly. Nonetheless, making the impact of economic events on people’s lives as specific and personal as possible can help raise public awareness, understanding and preparation.

Heng Swee Keat: The sale of structured products to retail investors Opening remarks by Mr Heng Swee Keat, Managing Director of the Monetary Authority of Singapore, at the Monetary Authority of Singapore’s Press Conference on the Sale of Structured Products to Retail Investors, Singapore, 17 October 2008. *  *  *  Many individuals who purchased structured products linked to Lehman Brothers are worried about their investments. MAS has been actively working to ensure a fair resolution for these investors. We have also been communicating our actions to the public since the issue first came to light in the middle of September. Our first priority has always been to help affected investors. Let me touch on what we have done and how we have put in place a serious and impartial resolution process to deal with investors’ legitimate concerns. First, we are making sure that HSBC Institutional Trust Services (Singapore) Ltd, the trustee for the Lehman Minibond Programme, carefully considers all options and acts in the interests of investors. If a new swap counterparty is available, investors would have the opportunity to vote on this option. In order to assist investors make an informed decision, MAS will appoint an independent financial adviser. We expect the trustee to know whether options will be available to noteholders by the end of next week.
It is likely to be around these and other aspects that our deliberations at the Riksbank will circle when the Executive Board finally adjusts the coming Inflation Report and next discusses monetary policy on 18 March. That is still almost a fortnight ahead and some more statistics are due to be published. In the meantime, the six of us on the Board will have to form our opinions step by step and decide whether there is to be some increase in the repo rate already in March or whether it is possible to go on waiting. Personally I share the concern about inflation prospects that a number of my colleagues have expressed in speeches recently. BIS Review 15/2002  3

And it is this tradition that has enabled the Banco de España to continue promoting economic history research. Many of these figures were my predecessors as governors or directors general of what was then known as the Research Department. 3/5  Others, who collaborated with them, then went on, in many cases, to pursue brilliant careers in academia and research. Indeed, some are here with us today. For the sake of brevity, and so as not to run the risk of missing anybody out, I will not mention in detail those who continued the work of the pioneers Mariano Rubio, Ángel Madroñero and Joan Sardà back in the 1960s. As a tribute to their work and following in their wake, I shall, without being exhaustive, set out some of the projects that our Bank currently has under way or on the drawing board in terms of promoting economic history studies. Firstly, the Banco de España regularly organises conferences focusing on the discussion of aspects relating to economic history. This year, for example, on the occasion of the sixtieth anniversary of the Stabilisation Plan, the Banco de España will, next October, be organising a conference in Barcelona focusing on the analysis of the Plan. It will likewise pay tribute to the figure of Joan Sardà. I trust you will be able to join us at this conference. Also, since 2015 the Bank has organised annually a top-level international economic history conference aimed at academia.
9  This view is discussed fully in Benito, A, Thompson, J, Waldron, M, and Wood, R (2006), “House prices and consumer spending”, Bank of England Quarterly Bulletin, Summer, pp. 142-154. 10  Some household level evidence for this view is given by Attanasio, O, Blow, L, Hamilton, R, and Leicester, A (2005), “Consumption, house prices and expectation”, Bank of England Working Paper No. 271. 4  BIS Review 7/2008  But even if there is not a strong causal connection between house prices and consumption through a wealth channel, there may nevertheless be a significant collateral channel. When house prices fall, the amount of housing equity and hence collateral at homeowners’ disposal decreases. This will tend to delay spending as lenders are willing to lend less or lend on less favourable terms to those who have little or no housing equity. That channel should have become less important in recent years. This is because most homeowners have substantial equity in their homes which would not be materially affected by relatively modest changes in house prices. 11 This may help to account for a decline in the correlation between real house price growth and consumption since the beginning of the decade (Chart 10). An analogous collateral channel may operate in the corporate sector. Declines in commercial property prices will weaken corporate balance sheets and this could affect corporate spending if lenders raise the cost of borrowing to affected companies. This effect is likely to be particularly pronounced among commercial real estate companies.

It is too early to declare the problem solved. The longer term bank funding markets remain relatively illiquid, many securitisation markets remain effectively closed (Chart 4), and general market sentiment remains fragile. Only a part of the total losses on sub-prime have yet been declared and not all the questions about the future of SIVs or the capitalisation of monoline insurers have yet been answered. The sub-prime chapter will not be closed for some months yet and there are still risks of re-ignition of the acute money market conditions we saw last month. But there are grounds for hope that we are reaching the end of the beginning at least and that the key challenge is moving from stabilising the financial markets themselves to dealing with the impact on the wider economy. 3  Structured investment vehicles are funds that issue short-term securities in order to invest in longer-term securities. The latter have typically comprised mainly of mortgage-backed securities and other asset-backed securities. Banks sponsored SIVs are managed by banks. 2  BIS Review 7/2008  Macroeconomic impact Judging that impact is not easy. Banking crises have typically reflected macroeconomic difficulties at home. Banks have lent too much and too cheaply at the top of the cycle and have then suffered from defaults when policy tightened and unemployment and failures increased.
All in all, these results suggest that the pandemic outbreak led to substantial liquidity risks for Spanish firms. National and supranational economic policies in different areas (fiscal, monetary and financial) reacted quickly and forcefully to tackle these risks in Spain and other countries. Let me review the main measures taken in this domain and their main goals. 3  See Blanco, R., Mayordomo, S., Menéndez, A. and M. Mulino (2020): “Spanish non-financial corporations’ liquidity needs and solvency after the COVID-19 shock “. Occasional Paper No. 2020, Banco de España. 4  In the area of fiscal policy, the Spanish Government introduced tax deferrals for firms and a favourable furlough scheme with the aim of reducing firms’ short-term liquidity needs. Also, the Government launched a public loan guarantee programme with an envelope of EUR 140 billion to encourage banks to lend to firms and the self-employed. Under this programme, the Government covers up to 80% of the credit losses on loans extended by commercial banks to SMEs and the self-employed, and up to 60%-70%, depending on whether the operation is a loan renewal or a new loan, in the case of loans granted to large firms. In the area of monetary policy, the ECB took several measures aimed at supporting bank lending by providing financing to banks under very favourable conditions.

11  See Special feature A “Financial integration and risk sharing in a monetary union”, in Financial Integration in Europe, ECB, April 2016 and Box 1 “What could enhance private financial risk sharing in the euro area?” in Financial Integration in Europe, ECB, May 2018. See also Asdrubali, P., Sorensen, B. and Yosha, O., (1996) “Channels of interstate risk sharing: United States 1963-1990”, Quarterly Journal of Economics, 111, 1081-1110; Athanasoulis, S. and van Wincoop, E. (2001) “Risk sharing within the United States: What do financial markets and fiscal federalism accomplish?”, Review of Economics and Statistics, 83, 688-698. 16