samchain/econo-pairs-v1 huggingface dataset:
In some countries that have experienced bank crises, the central government has intervened and saved the bank owners’ capital contributions. In my opinion, this is both unfortunate and inappropriate and creates the wrong incentives for the future. Like the banks, the supervisory authorities and legislators lacked insight into what risks were actually associated with banking activities in a competitive environment. This meant that the supervision remained largely as it had been before, with unchanged resources, despite a drastic change in conditions. There was neither the competence nor the instruments needed to assess what risks were arising within the banks. The main emphasis was placed on the banks reporting their positions correctly rather than on analysing the underlying risks. There were few economists within the Swedish Financial Supervisory Authority, but a lot of legal advisers. What was really needed was a suitable mixture of the two; and also other specialists in various forms of banking activities. Our experiences of the crisis mean that I cannot emphasise strongly enough the importance of having carefully-drawn up legislation in place that can provide effective support for the supervision to be conducted. As well as support for potential crisis management. The legislation should provide the supervisory authority with obligations and powers of authority to intervene at an early stage against institutions that do not meet the requirements set, to avoid problems in one institution becoming magnified and spreading to others. The intervention by the authorities must be predictable and objective, so that the banks are not forced to operate in uncertainty.

Lars Nyberg: Financial reforms and financial crises - Swedish experiences Speech by Mr Lars Nyberg, Deputy Governor of the Sveriges Riksbank, at the Central Bank of Sri Lanka, Colombo, 28 March 2006. *  *  *  Let me begin by thanking you for the invitation to come hear and speak today. It is a great honour to be asked to give a speech within the framework of this prestigious lecture series. On many occasions I – and several of my colleagues at the Riksbank – have described the financial crisis in Sweden at the beginning of the 1990s, both here in Colombo and in other contexts. That is because this crisis made a considerable impression on the Swedish economy, resulting in low – and during a number of years negative – growth and high unemployment. However it also made an impression in terms of making us consider what basic conditions were necessary to ensure that a financial system functions smoothly. There were many interacting factors behind the crisis experienced in Sweden. Mistakes made by bank management, by the supervisory authority and by politicians made the situation worse for the real economy. These mistakes were probably due to some extent to the financial markets having been regulated for almost half a century and so this affected the financial agents' way of thinking and perception of reality.
Own interest rate forecasts When we expressed our views in February regarding the future development of the interest rate, it was the first time we presented our own assessment of the future repo rate path. By this we mean that we try to calculate what we believe will be a well balanced monetary policy over the coming years. Previously we presented forecasts for the economy on the basis of what the financial market participants believed about the repo rate. Now that we are presenting our own interest rate path it will be clearer both what we believe about the interest rate and what we believe about the economy in general. We consider this to be a major step forward in the Riksbank’s way of explaining how monetary policy functions. For most people I believe it is more important to have an idea of the development of the interest rate over time, rather than to know what an individual interest rate decision will entail. In this context I always try to be as clear as possible. The interest rate path is merely a forecast, not a promise. The economic conditions on which we base our forecasts are constantly changing. Changes are constantly taking place in the economy, which means that we have to reconsider our opinions of future developments. The interest rate path represents nothing more nor less than the best assessment we were able to make at the time it was published. When the world around us changes, we also have to change our forecasts.

The labour market and household consumption are showing stable development and companies are still making good profits. We also know that US households and companies generally have strong balance sheets. But although most indications are that the economic downturn will be mild, there are risks of a more pronounced slowdown. From a Swedish perspective, the weakening in the United States is counterbalanced by the fact that the economies in the euro area are now developing better than they have done in a long time. The euro area is Sweden’s most important export market. We are seeing signs that both households and companies in the euro area have a more positive outlook on the future. Above all, it is the turnaround in Germany – Europe’s largest economy – that is important to the euro area. Several years of restructuring in German companies has led to lower costs and higher competitiveness. Unlike many other countries in Europe, Germany has taken a larger percentage of world trade and is now once again the world’s largest exporter. Japan has long been struggling with economic problems. Hopefully the Japanese economy is now heading for better times. The economy is growing at a fairly good rate and investment and exports are increasing. At the same time, higher incomes provide scope for higher consumption. There are many indications that the long period of falling prices and wage cuts will soon be over. The impression is in any case that the Japanese economy is moving in the right direction.
At a stroke, fire reduced significantly that existential threat. These benefits meant fire quickly became one of the first and most important examples of what economists would these days call a GPT – a General Purpose Technology.2 This is a technology that can be used 1 2  Dunbar (1993). Bresnahan and Trajtenberg (1995). 3  All speeches are available online at www.bankofengland.co.uk/speeches  3  across a wide variety of settings to a wide variety of tasks in a wide variety of places. Fire was the formative GPT for the human species, providing many of the everyday essentials of heat, light and protection. As with many GPTs, however, perhaps the greatest benefit of domesticating fire may have come indirectly and inadvertently. It was not a benefit primitive humans could remotely have foreseen at the time. Yet it was a benefit that, in time, would transform not just human bodies but human brains, not just human lives but human evolution. That elusive, transformational benefit was cooking. Fire transformed what humans ate. Cooking made edible the inedible, in particular protein-rich staples such as rice, wheat and potatoes. Cooking reduced the chances of illness from eating, by killing germs and parasites commonplace in foodstuffs. And cooking made it quicker and easier for human bodies to digest all foodstuffs, causing humans’ intestinal track (the part responsible for digestion) to shorten dramatically.3 Together, these had a transformative impact on the human body. Cooking meant far less of our bodies’ energies were devoted to gathering, eating and digesting food.

During the Napoleonic war, Sweden lost Finland to Russia and in the Kiel peace treaty of January 1814 it was decided that Norway, which was then a part of the Danish kingdom, should instead join Sweden. The treaty was of course op-posed by the Norwegians, and during the spring of 1814, when Sweden was occupied with wars on other fronts, the Norwegians took action. They declared their independence, drew up a constitution and appointed a committee to plan a new Norwegian central bank. But in July Swedish soldiers arrived. After a brief battle, Norway accepted the Swedish king as king of Norway. However, the union created was fairly loose. Except for the foreign service, Norway retained all state institutions that characterize an independent state. In June 1816, exactly 200 years ago, Norges Bank was established. The bank was located in Trondheim far from the politicians in Kristiania (which we now know as Oslo) and even further away from Stockholm and the Swedish king. Norges Bank was founded in a challenging environment where the economy was in a state of chaos following the Napoleonic wars, and confidence in the monetary system was low. The previous joint currency with Denmark had col-lapsed, and attempts to restore it had failed. It took a long time before the newly established Norges Bank managed to create credibility for the Norwegian currency. In the first years of its existence, the bank’s main tasks included managing silver tax payments and handling receipts, printing and distributing banknotes and bookkeeping.
BIS Review 126/2010  5  Figure 1 EES: Inflation expectations (percent)  Inflation indicators (annual change, percent) 12  12  9  9  6  6  7  7  6  6  5  5  4  4  3  3 2  3  3  0  0  2  -3  -3  1  06  07 IPC  08  09  10  IPCX  02  04  06  08  10  1  At December 2010 A diciembre del 2011 One year ahead Two years ahead  IPCX1  Sources: Central Bank of Chile and National Statistics Institute. Figure 2 Monetary policy interest rate (percent)  10  10  8  8  6  6  4  4  2  2  0  07  08  09  10  0  Real interest rate gap: Real MPR minus indicated neutral interest rate (percent) 6  6  3  3  0  0  -3  -3  -6  -6  00  02  04  06  08  10  Rate implicit in the CBC's forecasting models Rate resulting from consumption-based model Source: Central Bank of Chile.

Jean-Pierre Roth: Monetary policy and credit markets Summary of a speech by Mr Jean-Pierre Roth, Chairman of the Governing Board of the Swiss National Bank, at the University of St Gallen, St Gallen, 22 January 2004. The complete speech can be found in German on the Swiss National Bank’s website (www.snb.ch). *  *  *  The economic slump of the past two years has affected the credit markets. Corporate loans declined, and on the capital market redemptions of shares and bonds of private borrowers exceeded new issues. In this speech, a few general points concerning credit financing and monetary policy will be discussed. The financing opportunities and, concomitantly, a borrower’s expenditure behaviour depend on the value of capital assets eligible as collateral or, more generally, on the borrower’s balance sheet structure. Due to the major significance of real estate as security, the situation on the real estate market in turn has a considerable bearing on credit conditions. The Swiss National Bank thus keeps a careful eye on price development in the real estate market. Monetary policy influences the prices of investments and thus impacts on the economy via the borrowers’ balance sheets. This is not the only channel - and certainly not the most important one through which monetary policy exerts an influence; it may, however, be relevant under certain circumstances. Since corporate balance sheets differ considerably from one enterprise to another, monetary policy has distributive effects.
While the long-term objective should be to create conditions for achieving a more balanced and diverse financial system, the shorter times objectives should focus one having a stable financial system that provides adequate financial services to its customers, both savers and borrowers, thus maintaining its fair share of contribution to the economic developments of a particular country. The banking sector in Albania has felt the impact of the international financial crisis, as the weaker credit standards before the crisis and the weaker economic growth afterwards, have been translated into lower asset quality and difficulties to consistently maintain positive financial results. In front of higher credit risk, credit terms have been tightened and credit growth has been sluggish. In September 2013, credit growth turned negative driven by credit in foreign currency and to businesses. However, the banking sector remains well capitalized and liquid. Banks have been able to raise new capital and financial support from their mother banks. Especially, Greek banks operating in Albania have enjoyed strong support from their mother banks so far, and we expect this to continue in the future too, if needed. Overall, in September 2013 the risk  BIS central bankers’ speeches  1  weighted capital of the banking sector stood at 17.8%, while the ratio of liquid assets to short term liabilities was 36.5%. The sector has shown strong preference for investments in Albanian government debt securities and placements abroad. Bank of Albania has been taking a number of measures to support credit growth and address the loan quality problems.

The dual objective of PEPP  5/7  BIS central bankers' speeches  To enhance the effectiveness of our asset purchases, the PEPP has to be operationalised in a way that it meets the described dual objective. The PEPP is not an interventionist programme where we stand on the sidelines when conditions are calm and enter the market only in times of market disturbances. It rather resembles a two-staged pyramid. At the basis, there is a constant flow of purchases that reaches out to all eligible market segments. In the sovereign space, these purchases are guided by the ECB’s capital key. This is the “stance” element of PEPP. It seeks to create financial conditions that are consistent with our inflation aim. The upper part of the pyramid is its flexibility. This element responds to the challenges posed by the pandemic to market functioning and the smooth transmission of our policy to all parts of the euro area. The first granular breakdown of our PEPP purchases, published last week, highlights this particular aspect of our reaction function. It stresses the three dimensions of flexibility in the PEPP. First, in the sovereign space, monthly purchases in all jurisdictions will exceed the “basis” flow if we observe a general tightening of financial conditions across countries, unusually high volatility or poor liquidity. In this case, we frontload purchases, following the ECB’s capital key. Second, we raise the share of purchases above the capital key in countries facing severe risks of fragmentation.
Page 15  Expressed in the context of the canonical new Keynesian model of monetary policy transmission, this essentially revolves around whether it is sufficient for the policy rate alone to appear in the ‘dynamic IS curve’ equation in that model, or whether other measures of monetary and financial conditions are required. My tentative conclusion is that a consensus exists that the policy rate alone is not enough. A structural understanding of how monetary policy actions influence risk, term, liquidity and credit risk premia – and thus the broad set of asset prices that influence aggregate demand – is likely to require an understanding of portfolio decisions by households, firms and financial institutions, where access to a safe monetary asset plays an important role. But, to the extent that the most important of these asset prices are set in open traded markets where the prices are observable in real time, in many cases the practical implementation of monetary policy can continue by conditioning policy rate decisions on those asset prices as well as the broader economic environment. This focus on the IS curve leaves open the question of whether monetary developments can also enter the Phillips curve relationship in the canonical new Keynesian model, say via influencing longer-term inflation expectations by acting as some form of ‘nominal anchor’ to the economy. I don’t have the time or space to even start to address that question today. But it does seem central to some of the fears expressed by Lord King two decades ago.

If a QT sale is pre-announced ahead of implementation, the initial fall in bond prices will result in a pre-implementation increase in the share of money in the overall portfolio: money is capital certain, whereas the value of bonds will be lower on announcement because of the expectation that bond prices will fall on implementation. To justify that relative increase in money holding ahead of the implementation of QT, the expected return on bonds must be lower in the post-announcement / pre-implementation period, requiring an expected capital loss in the period up to implementation. So the post-announcement fall in the bond price must be smaller than the implementation fall in the bond price, to create the expectation that bond prices will fall – there is some ‘undershooting’ in announcement effect relative to the implementation effect. Applying this logic over a longer time scale implies that an earlier announcement will lead to a smaller initial impact on asset prices followed by a larger number of periods where the asset price falls ahead of implementation. Furthermore, the greater the substitutability between money and bonds in the NBFI’s portfolio, the less the expected capital loss on bonds required to sustain the higher relative holdings of money in the post-announcement / pre-implementation phase. By implication, a greater part of required  Page 13  overall downward adjustment in bond prices can happen up-front on announcement.
Eric S Rosengren: Two key questions about the economic recovery Remarks by Mr Eric S Rosengren, President and Chief Executive Officer of the Federal Reserve Bank of Boston, at the New England Mortgage Expo, hosted by the Connecticut Mortgage Bankers Association and The Warren Group, Boston, Massachussetts, 14 January 2011. *  *  *  I’d like to thank the conference organizers for inviting me to speak with you today. The beginning of a new year is a good time to discuss the outlook for the economy. I will also try to answer a couple of the key questions that most everyone seems to be asking about, in relation to this recovery.1 As I’m sure you know, over the past several weeks we have been getting economic data consistent with a somewhat happier new year. A recovery that has been anemic for the past year and a half looks to be increasingly supported by private spending as 2011 begins. The Blue Chip forecast for 2011 has increased 4 tenths over the previous month, to 3.3 percent. And I am slightly more optimistic than the Blue Chip; my own forecast is for growth of 3.5 to 4.0 percent over 2011. This is certainly an improvement, but – soberingly – would still leave the unemployment rate close to 9 percent at the end of this year, a rate far above anyone’s estimate of full employment.

The benchmark figure used for the weighting is based on the top panel of Figure 1B in Mayer and Pence (2008): “Subprime Mortgages: What, Where and to Whom?” Finance and Economics Discussion Series Paper No. 2008-29, Board of Governors of the Federal Reserve System – available on the Board of Governors website at http://www.federalreserve.gov/PUBS/FEDS/2008/200829/200829pap.pdf. BIS central bankers’ speeches  3  suggests that inflation is not likely to be a problem, then we can more comfortably align policy to continue supporting the recovery. Some observers and analysts have voiced great concern that the nascent economic recovery, combined with the actions of the Federal Reserve that have expanded its balance sheet, will lead to significant inflation. However, Figure 11 provides a variety of different measures of core inflation; core CPI, core PCE, trimmed core CPI and trimmed core PCE. It is striking how much all four series have declined. In fact many of these series are at their historical lows. Figure 12 shows the different measures of core inflation in the top panel, and the Federal Reserve’s balance sheet in the bottom panel. In the fall of 2008, the Federal Reserve’s balance sheet expanded significantly – but that period also corresponds to the emergence of disinflation (a reduction in the inflation rate) in the U.S. While monetary policy works with lags, why has the unprecedented increase in the Federal Reserve’s balance sheet corresponded with continued significant disinflation?
As for the elderly, the Government provides a non-contributory means tested Old Age Living Allowance for those aged 65 or above; and people that do not fall within either of the first two groups. Typically this group of citizens are those who have worked hard for their whole life, used up the bulk of their earnings in raising their children, and may be owning a small apartment. Most (iii) of them, by the time they retire, do not enjoy any pension or other forms of voluntary retirement benefits. They do have some accumulated savings in their Mandatory Provident Fund accounts, but it is unlikely that, for various reasons, the amount, on its own, would be large enough to support a decent retirement life. 3. It is the retirement protection of this third group of citizens that I wish to address today. In Hong Kong, about 70% of the 1.7 million privately owned residential housing units, including subsidized home ownership flats, are owner-occupied. Around 65% of the owner-occupiers have fully paid down the mortgage loans, if any, of their properties. For those owner occupiers who have already paid off their mortgages, many of them don’t have a lot of other savings or assets at their disposal. Even for those with some savings, they are having a tough time in managing their money if they don’t have the expertise or the appetite in active investment.

Climate Finance Day 2018 – Paris, 28 November 2018 The role of finance: Anticipating climate risks, financing transition opportunities  Closing session: Speech by François Villeroy de Galhau Governor of the Banque de France  Press contact: Mark Deen (mark.deen@banque-france.fr). Page 1 sur 6 Ladies and Gentlemen, It is a great pleasure to be here to conclude this fourth edition of Climate Finance Day. This event gives a concrete picture of what I like to call the “powerful coalition of the willing”. Each and every one of us – public authorities; academics, NGO’s and think tanks; corporates and financial institutions – have a part to play in this coalition. It is a shared challenge that no one can tackle alone, and you have worked during these last three days to bring tangible solutions to quickly and effectively finance the transition. Paris, chère Madame la Maire, has been a driving force committed to translating momentum into concrete action. Let me mention three key milestones: the COP 21 back in 2015, the “One Planet Summit” in December 2017, and this fourth edition of Climate Finance Day. To better address concretely the financial risks stemming from climate change, the Banque de France initiated a Network for Greening the Financial System (NGFS) at the One Planet Summit, with eight founding members. i In less than one year, we have been joined by 13 other members ii and five observers iii from the five continents. They work together with great energy and enthusiasm.