samchain/econo-pairs-v1 huggingface dataset:
With the support of the IMF, Japan, and a number of other countries in the region, Thailand has launched a courageous and comprehensive program that addresses the problems of large external deficits and troubled financial institutions. As a result, the budget is moving back into surplus and a comprehensive restructuring of the financial sector is getting under way. The Philippines, for its part, has taken necessary measures and extended its program with the IMF under which a substantial amount of economic adjustment and reform had already taken place. Malaysia is also adapting to changing conditions by scaling back investment plans, tightening its fiscal stance, and strengthening prudential banking regulations. Indonesia has strengthened its policy stance in continuous dialogue with us, and has recently reached agreement with the Fund on a major program consisting of: strong monetary and fiscal policies to bring about orderly adjustment in the economy and restore confidence to financial markets; a major restructuring of the financial sector, along with measures to ensure its future soundness; and significant deregulation measures and trade reforms that should improve economic efficiency immediately and over the longer term. The Fund has agreed to support this program with a loan of $ billion in a total package of $ billion, of which $ billion will consist of multilateral financing. On top of that, a contingency safety net is being established through which an important group of countries have declared their readiness to complement our package in the case of unexpected need.

A few countries went further, and sought to curb transactions in home currencies in offshore markets. At the same time, there has been an ongoing effort to develop bond markets in Asia. Issuance of domestic government bonds has increased sharply in most Asian countries. Certainly, a large part of the increase reflected the spike in fiscal deficits resulting from the debt restructuring operations in the financial sector during the Asian crisis. Nonetheless, corporate bonds have also grown. There is a trade off between tightening up the capital account, and developing the bond markets. Measures to restrict offshore foreign currency trading have been effective, in so far as reducing or eliminating offshore markets is concerned. But these safeguards come at a cost – they also hinder the development of capital markets, especially the bond markets. Size and liquidity are essential attributes for a market to attract international interest. Already in size and liquidity, we clearly lag behind our counterparts in the West. If Asian markets are fragmented and unable to grow, they risk being ignored by global investors. In the immediate aftermath of the Asian crisis, countries that have suffered at the hands of the markets are understandably disinclined to err on the side of fewer restrictions, especially as the benefits from bond market development are not likely to be large given structural problems in the economy.
They engaged in discussions with potential Korean buyers and approached Warren Buffett. At no time did the New York Fed tell Lehman that it would be bailed out with taxpayer money, nor did the New York Fed instruct Lehman to act as if such an option was available. Lehman’s CEO, Mr. Fuld, and the Chairman of the Lehman board of directors, Thomas Cruikshank, have made clear that Lehman was not expecting any Federal bailout. 4 Both men fully understood that Lehman was a public company and needed to be fully responsible for its own financial situation. Lehman weekend September of 2008 will likely be remembered as an epochal period in the history of American finance. The bankruptcy filing by Lehman occurred during that month, and it must be analyzed in the context of that most distressing time. On September 7, the Federal Housing Finance Agency placed Fannie Mae and Freddie Mac into conservatorship, and the Treasury Department used its authority, granted by Congress in July 2008, to make financial support available to these two government-sponsored entities. While Lehman is often considered the trigger for the systemic consequences that were to come later in the month, it is also clear that Fannie and Freddie’s decline, among other factors, caused a number of market participants to begin “hunkering down” to protect their balance sheets. Exposure to Lehman was one of the items to be addressed.

2  Donald L. Kohn, Vice Chairman, Board of Governors of the Federal Reserve System, Risk Management and Its Implications for Systemic Risk, before the Subcommittee on Securities, Insurance, and Investment, Committee on Banking, Housing, and Urban Affairs, United States Senate, June 19, 2008. 2  BIS Review 112/2010  supervising Lehman. The SEC continued to be the supervisor of the broker-dealers and their parents, including Lehman’s broker-dealer and its parent, Lehman Holdings. Lehman showed some signs of recovery during this period. It raised capital in June of 2008. But liquidity continued to be a significant disability. As part of its monitoring, the New York Fed, in conjunction with the SEC, conducted liquidity stress analyses of the investment banks, in part to evaluate their creditworthiness. Those analyses suggested that Lehman needed to improve its liquidity should the credit crisis intensify. Again, to Lehman’s credit, and in response to our analyses, Lehman took steps to, and did, improve its liquidity. At no time, however, did anyone at the New York Fed believe that Lehman had sufficient liquidity to withstand what was to come in September, events that Richard Fuld, Lehman’s former chief executive officer, has described as the “perfect storm.” 3 Accordingly, as has been well-documented in the press and in the comprehensive report by Anton Valukas, the Lehman Brothers’ bankruptcy examiner (the Valukas Report), senior Federal officials, including President Geithner, continually pressed Lehman to find workable solutions for its capital and liquidity problems from March to September 2008. Lehman executives pursued potential merger partners.
In autumn 2002, Norges Bank established a regional network as a tool to gauge the level of activity in the Norwegian economy. The network consists of companies, organisations and municipalities throughout Norway. In the two contact rounds in connection with Inflation Report 1/03, discussions were held with 440 contacts. We will be having six rounds of talks each year with business and community leaders concerning financial developments in their enterprises and industries, with about 200 visits in each round. The selection of contacts represents the production side of the economy, both industry-wise and geographically. In the course of 2003, the number of contacts associated with the network will rise to about 1000 persons, who will be contacted once or twice a year. Østlandsforskningen is responsible for the network and conducts contact meetings in Hedmark county. Our assessments are based primarily on official statistics, but because of the time lag involved and revisions of these statistics, supplementary information from other sources is useful. The regional network provides up-to-date information on the state of the Norwegian economy. Regular talks with local business and community leaders provide information that can supplement available official  BIS Review 23/2003  3  statistics. Moreover, we obtain supplementary information about areas not covered by official statistical sources. We also learn which issues are of particular concern to enterprises. Region Inland seems to have felt the impact of the downturn to a lesser extent than other parts of the country. Developments in domestic manufacturing are approximately in step with domestic consumption.

1 2  72.9 per cent in March – against a 30-year average of 80.2 per cent 1972-2003. Private defined-benefit pension schemes are estimated at approximately 3 per cent of GDP. Estimate by the Pension Benefit Guaranty Corporation, referred to in The Economist, May 2003. 2  BIS Review 23/2003  As mentioned earlier, the driving forces behind the Norwegian business cycle have differed from those in other countries. In Norway, the business cycle has followed a course more similar to previous fluctuations, with a sharp rise in household demand, labour shortages and strong wage growth. Measured in a common currency, labour costs for Norwegian industrial workers have increased by a total of 19 per cent more than was the case for our trading partners in the period 1996-2002 (13 per cent due to wage growth and 6 per cent due to the appreciation of the krone). In the years around the millennium, the depreciation of the krone veiled the underlying deterioration in competitiveness. In May 2000, the krone exchange rate reached its lowest level in six years. In the subsequent period up to end-2002, the krone appreciated, and the effects of high wage growth have gradually come into evidence in company accounts. High labour costs measured in a common currency have weakened profitability in the business sector. This is the reason for the current cost cuts, the decline in employment and the increase in unemployment.
Rather than simply resetting the quantitative standards, we sought to develop a new forward-looking approach that would be more sensitive to the actual risks that banks take on, one that would ensure a level playing field for banks that compete globally, one that would be better able to evolve with, and indeed encourage, future improvements in the measurement and management of risk, and one that would be well-anchored on a solid corporate governance structure and a sound risk culture. If you allow me, I will draw one more parallel between monetary stability and financial stability. I would say that Basel II incorporates some of the key basic principles that are also built in modern approaches to monetary policy and which have successfully resolved the debate between rules and discretion: a flexible and forward-looking approach, anticipatory rather than reactive behaviour to risk, and the need to take into account market views. The new capital framework is much more comprehensive than the 1988 Accord for many reasons: it applies to a wider scope of entities within banking groups; it offers a menu of different alternatives to fit different circumstances; it encompasses additional risks, in particular operational risk; it widens the recognition of credit risk mitigation techniques; it sets out a thorough framework for securitisation transactions; and, most importantly, it is based on three mutually reinforcing pillars. The first pillar aligns the minimum capital requirements more closely to banks’ actual underlying risks.

This political dimension is essential in order to understand how the momentum was maintained over an extended period of time so as to achieve gradual progress towards ever increasing integration: from industrial co-operation through a customs union and a single market to Economic and Monetary Union. Having recalled this institutional background, I will focus in my remarks today on the policy and operational requirements of exchange rate and monetary policy co-operation in Europe. 2. Policy requirements Consensus on the main policy objectives to be pursued over time has always been a key requirement for effective exchange rate and monetary policy co-operation in Europe. The objectives were, initially, exchange rate stability and, subsequently, the creation of a monetary union based on price stability. A need for exchange rate stability arose in the 1970s, in the wake of the collapse of the Bretton Woods system. Stability was needed in order to minimise the risk of trade tensions within the European customs union at the time. This led to the creation of the European Monetary System's Exchange Rate Mechanism (EMS/ERM) in 1979. The need for exchange rate stability became even more acute from 1986 onwards, with the move towards the creation of the single market for goods, services, capital and people. BIS Review 1/2001  1  The completion of the single market involved the full liberalisation of capital movements within the EU at the beginning of the 1990s.
This is definitely something the general public can require of us in our role as an independent authority. So, to refer back to the questions I asked at the beginning. No, I do not think we have made things unnecessarily complicated or tried to fix things that are not broken. We have made changes we consider to be necessary both to improve the base for making monetary policy  BIS Review 106/2007  5  decisions and to provide as true and honest a picture of how monetary policy is conducted as possible. What has happened on the financial markets? In principle, communication is always important to a central bank and is a corner-stone in most parts of our activities. When the world around us is marked by uncertainty and unrest, the question of communication becomes even more important. There has recently been considerable unrest in the financial markets. But the Riksbank has nevertheless seen no need to specifically go out in public and comment on these developments. Sweden has not been affected to the same extent as many other countries and the Swedish interbank market and the financial system have functioned comparatively well. But let me nevertheless say a few words about what has happened and about the role the Riksbank plays in this context. General uncertainty has increased the need for liquidity abroad… Over the summer we saw signs of problems in the US housing market.

2 And we have taken further steps in this direction over the past two years in particular. But what are the reasons behind this development towards greater openness? I think there are two reasons – democracy and efficiency. The first concerns our role as an independent authority. The second is linked to the fact that our communication with the financial markets and the general public is essential for monetary policy and the financial system to function efficiently. 1  Page 38 in Blinder, A. S., (2006), “Monetary Policy Today: Sixteen Questions and About Twelve Answers”. I Fernandez de Lis, S. and F. Restoy (ed. ), Central Banks in the 21st Century, Banco de España. 2  See, for instance, Eijffinger, S. and P. Geerats, (2006), “How Transparent are Central Banks?” European Journal of Political Economy, vol. 22, 1-21. BIS Review 106/2007  1  Our independence requires openness The Riksdag and ultimately therefore the Swedish people have given the Riksbank considerable independence. But this is a “freedom with responsibility” that goes hand in hand with the requirements for insight and accountability. This is how things should be in a democracy. Openness is also something that traditionally imbues the Swedish public administration system in general. One of the corner-stones is the principle of public access, which means that the authorities’ activities should as far as possible be carried out in an open way. And this also applies to the Riksbank, of course.
A sound capital market, in turn, can better channel savings to different horizons and to more productive projects. In addition, encouraging savings would undoubtedly have a positive effect on trend growth. As for improving productivity, there are certainly no easy solutions to such a task. Proof of this is that several governments have convened commissions, and programs have been undertaken to address this issue. So far, we have not achieved sufficient improvement to reverse its downward trend. All in all, it is a much-needed effort to implement. Elements such as education and job training are significant and far-reaching challenges. So are those related to the availability of resources to expand the capital stock. Here, once again, generating policies that favor savings can play a very important role. It is important to bear in mind that increasing growth is not an end in itself, but the means by which we can generate a greater flow of resources and distribute more to all of us part of this country. Dear senators, we face very important challenges ahead. The economy is going through a period of adjustment that is necessary to bring inflation down to levels compatible with the 3% target over a two-year horizon. The closing of imbalances is inevitable; our task is to bring it about at the lowest possible cost to households and businesses. Macroeconomic policies are doing their job to make this happen, but there is still a long way to go to ensure that the problem has been solved.

Monetary policy in Singapore is centred on the management of the exchange rate. As an international financial centre with open capital markets, we are exposed to large and sometimes, volatile capital flows. To facilitate the effective conduct of our monetary policy and to avoid large swings in our $ exchange rate, we have a policy of discouraging the internationalisation of the $ However, we recognised that the trade-off was a less vibrant capital market, particularly the debt market. So we have progressively relaxed the specific restrictions over the past six years, while maintaining the intent of the policy. The results have been positive. The non-internationalisation policy is now down to two basic safeguards to discourage speculation in the $ - banks may not lend $ to non-resident financial institutions in order to speculate on the $ and non-resident borrowers who raise $ through bank borrowings or on our capital markets must swap or convert these $ to foreign currencies before remitting them abroad. This stance remains appropriate, and continues to underpin the effective conduct of our monetary policy. Nevertheless, there is scope for further fine-tuning. We have decided that non-resident, non-financial issuers of $ bonds and equities will no longer be required to swap or convert their $ proceeds into foreign currencies before remitting abroad. Non-resident, financial issuers of bonds and equities will still have to do so. This will give the issuers greater flexibility in managing their $ funds.
The European Fiscal Board interestingly proposed relying on a ceiling on the growth rate of primary public expenditure, net of discretionary revenue measures iv. c/ Making headway with a Financing Union for Investment and Innovation. Private risk-sharing mechanisms, which are less frequently considered than public ones, are just as important and effective, as we can see in the US where capital markets play a more important role as a buffer between states than fiscal transfers. Here, solidarity and responsibility are mutually reinforcing. The euro area has an abundant, and rarely mentioned, resource at its disposal: a savings surplus relative to investment, which amounted to EUR 360 billion last year. This resource is currently invested outside the euro area, even though our potential investment needs are substantial. A better allocation of European private savings requires more efficient crossborder financing channels – savings are not always where the investment need arises – and more efficient “transformation”: preferred savings instruments are often short-term and safe, while financing needs are often longer-term and riskier. This requires the combination of a more effective Banking Union and a “Capital Markets Union”, to make a genuine “Financing Union for Investment and Innovation”. European governments all agree in principle; let us now at last walk our talk, as a significant private booster to our collective exit strategy. d/ Keeping in place an accommodative monetary policy, against the backdrop of low inflation – 0.4% in April in the euro area.

It is aiming at preserving and improving the situation of employees and of all our fellow citizens in the euro area. Such a responsible policy directly benefits those who are unemployed by significantly improving their employment possibilities. It benefits all our fellow citizens by supporting the purchasing power of their income, thus preserving the well-being of euro area households. And it contributes to meeting one necessary condition for sustainable long-term growth and active job creation in the euro area, which is price stability. Naturally there are also a number of other factors that are contributing to sustainable growth and job creation, in particular sound public finances and, as I already said, structural reforms that enhance competition, increase productivity and foster economic flexibility in order to elevate the growth potential of our vast euro area economy. Augmenting the growth potential of Europe is a major goal for all of us. Background information Table 1: Compensation per employee growth (whole economy) across euro area countries  2  BIS Review 52/2007  Table 2: Unit labour costs growth (whole economy) across euro area countries  Table 3. Labour productivity growth in the euro area countries  BIS Review 52/2007  3  Table 4. Employment growth in the euro area countries  Table 5. Unemployment rates across euro area countries  4  BIS Review 52/2007
At the same time the Bank would be obliged to submit a report to the Government, which would be made public, stating the reason for the deviation, its planned response and the length of time that it expected to take to bring inflation back within target. When the target was set, inflation was running relatively high in Iceland. Bearing that in mind, the upper tolerance limit was set for 6% this year, 4½% in 2002 and then 4% from the year 2003 onwards. Upheavals in the foreign exchange market in the spring and a sharp depreciation of the króna caused a substantial rise in inflation, which exceeded the upper tolerance limit in June. The Central Bank submitted a detailed report to the Government on June 20. Other aspects of the joint declaration included a provision that, notwithstanding the abolition of the exchange rate target band, the Central Bank would intervene in the interbank market in foreign exchange by buying and selling currency if it deemed this necessary in order to contribute towards attaining the inflation target, or if it viewed exchange rate swings as a threat to financial stability. At the same time, the Central Bank undertook to produce a quarterly inflation forecast projecting two years into the future.

At the same time, notwithstanding rate hikes in the US, mortgage rates in Singapore remain very low. The risk of a renewed unsustainable surge in property prices is not trivial. Second, investors continue to search for yield and safety in property markets across the world. Regional property markets have been buoyant and their respective authorities have, in the past six months, introduced further property cooling measures. For instance: - China, Hong Kong, South Korea, and New Zealand have tightened prudential requirements such as housing loan-to-value ratios and debt servicing ratios. - In Australia, New South Wales will be doubling the stamp duty surcharges for foreign investors. We must be vigilant that tightening measures elsewhere do not lead to spill-over of investor demand into the Singapore market. Easing the measures now would send a wrong signal. The calibrated adjustments by the government earlier this year do not signal the start of 4 / 10  BIS central bankers' speeches  an unwinding of the property cooling measures, as some commentators have suggested. MOF, MND, and MAS stated this very clearly in their joint announcement in March and this remains the position. The statement also said that the current Additional Buyer’s Stamp Duty (ABSD) rates and Loan-to-Value (LTV) limits would be retained. MAS has, on a few occasions, emphasised that the TDSR is a structural measure to ensure financial prudence and not a cyclical tool to be adjusted periodically. The adjustments in March were made for very specific reasons and purposes.