samchain/econo-pairs-v1 huggingface dataset:
Our standard and non-standard measures ensure price stability in the euro area. While our standard measures signal the monetary policy stance, our non-standard measures ensure the transmission of the desired policy stance to the real economy in those market segments in which the transmission is impaired. Our non-standard measures ensure that despite increased liquidity demand, financial institutions are able to continue lending to clients. However, misconceptions persist related to the Securities Markets Programme, our programme for intervening in government bond markets. The SMP deliberately addresses the appropriate transmission of our monetary policy to the real economy in market segments which are impaired. Government bonds are crucial for the transmission of monetary policy, via their status as a benchmark for borrowing by banks. Put simply, left unaddressed, the malfunctioning of sovereign bond markets’ could block the bank lending channel. An important difference with Quantitative Easing programmes is that the liquidity injected into the banking system via the SMP is sterilised by the ECB through regular liquidity absorbing operations. The ECB has been widely recognised as an institution capable of timely, decisive and convincing action during tumultuous times. We see this as a mark of distinction. However, it would be erroneous to derive from this that it should be a political institution in charge of running the euro area economy. It cannot be and should not be. The ECB is a central bank, committed to its mandate to preserve price stability over the medium term. It is not the fiscal lender of last resort to sovereigns.

First proposition: The need for radical changes in national economic policy-making Let me begin with my first proposition, that membership of EMU entails much deeper policy changes than were previously acknowledged. The crisis has shown very clearly that countries that adopt the euro have to alter the conduct of their economic policies. These changes are fundamental. Among them, three are particularly relevant. First, in a monetary union fiscal and supervisory authorities have to adopt policies that counteract the emergence of private financial imbalances at the national level. This is a consequence of the ECB’s legal obligation to maintain price stability in the euro area – defined as an inflation rate of below, but close to, 2% over the medium term. Private debts denominated in euros cannot be “inflated away”. Second, fiscal and other national macroeconomic policies have to ensure competitiveness by resisting increases in nominal trends. This is the implication of sharing an exchange rate; devaluation cannot be used as a tool for any one country to regain competitiveness. Benchmarking against other euro area countries is unavoidable. Third, fiscal authorities have to build up sufficient buffers in good times to withstand adverse conditions. This follows from the prohibition on monetary financing which prevents the central bank from directly financing governments as well as the so-called “no bail out clause” of the Treaty which prohibits a Member State to assume the liabilities of another Member State.
Freedom of movement of capital is now the rule between industrialised countries and is also becoming more widespread in emerging countries. This makes it easier for the deficits of one group of countries to be financed by the surpluses of the others. In itself, the greater efficiency of financial markets is an additional factor contributing to growth, and is therefore a good thing. However, it is still possible that the continued indebtedness of some countries (due to the substantial disparity in national savings efforts) could dangerously weaken financial markets in the event of a crisis of confidence. The stability of global financial markets last year was a positive factor for our country, with its manifold connections to the global economy and a currency that has often suffered from external monetary turbulence. However, this high level of market stability should not be regarded as permanent. There are still major underlying risks and there is no justification for diminishing our vigilance as regards possible market instability. Meanwhile, companies need to remain cautious about exchange rate risks, despite the fact that the volatility of the Swiss franc has been low over the past few years. For its part, the SNB is aware of the vulnerability of financial markets and takes particular care to ensure that its monetary policy is properly understood by economic agents. We command a high level of credibility because of the attention we pay to communicating our decisions and the monetary stability results achieved in our country. This makes our interest rate policies very effective.

But there is one other area – as investors in bank capital instruments. I am therefore sure you understand that the authorities, internationally, cannot avoid reviewing what should count in the medium term as regulatory capital for banks. It won’t do for banks to be able to leverage up on subordinated debt (or other forms of hybrid capital) if, just when it matters, the holders do not suffer because the authorities cannot let the banks concerned be liquidated without bringing system collapse down on us all. We either need a system where banks of any type can quietly fail and hybrid capital is actually useful in protecting the deposit insurer; or, more realistically, we shall need a much narrower definition of capital. Only equity can absorb losses and sustain a going concern. Finding a way through that in the current crisis remains a challenge. One helpful step might be for the investment industry to seek out opportunities to convert subordinated debt into equity; or, at a discount, into senior unsecured debt, as has occurred in a few instances already. It would probably entail a haircut, but I wouldn’t air it unless I thought it could be in your collective and medium-term interests as investors in our economy and the system of credit that supports and lubricates it. The new Special Resolution Regime for banks may create healthy incentives in that broad direction. In concluding, can I thank you again for inviting me to join you today.
Summers, L (2013), speech at IMF Fourteenth Annual Research Conference in Honor of Stanley Fischer. Susskind, R and Susskind, D (2015), The Future of the Professions: How Technology Will Transform the Work of Human Experts, Oxford University Press. Swinney, P (2018), ‘The wrong tail’, Centre for Cities. Universities UK (2017), ‘Patterns and Trends In UK Higher Education’, Universities UK. Van Reenen, J, Bloom, N, Draca, M, Kretschmer, T, Sadun, R, Overman, H and Schankerman, M (2010), ‘The Economic Impact of ICT’, SMART N. 2007/0020. Willetts, D (2017), A University Education, Oxford University Press. 26  All speeches are available online at www.bankofengland.co.uk/speeches  26  Annex Chart 1: World GDP per head since 1000 AD 1990 International Dollars  7000 6000 5000 4000 3000 2000 1000 0  1000  1100  1200  1300  1400  1500  1600  1700  1800  1900  2000  Year Sources: De Long (1998). Chart 2: UK productivity, real wages and GDP per head Index, 1760 = 100 1800 1600 1400 1200 1000 800 600 400 200 0 1760  1810  1860  Productivity  1910 Real wages  1960  2010  GDP per head  Sources: Bank of England, ‘A millennium of macroeconomic data’, available online. Notes: Labour productivity per head uses GDP at factor cost. Real wages defined as nominal wage divided by GDP deflator at factor cost.

Ardian Fullani: Medium and long-term development priorities in Albania Speech by Mr Ardian Fullani, Governor of the Bank of Albania, at the Joint Press Conference with the Ministry of Finance and the International Monetary Fund Mission, Tirana, 27 September 2013. *  *  *  Dear Minister of Finance, Dear Mr. Ilahi, Dear media representatives, The past two weeks have seen very intensive discussions on the current situation of the Albanian economy, the state of public finances, the developments in the financial system, as well as on the country’s development perspective and management of economic policies, which should support Albania’s sustainable and long-term growth. As the Governor of the Bank of Albania, I am pleased to see convergence on a common and real diagnosis of the current situation, and also on many viewpoints about medium-term and long-term development priorities. I would like to share with the media several opinions of the central bank on these issues. Two days ago, at its monthly meeting on monetary policy, the Bank of Albania analysed the latest information on current and expected performance of the economy. I made public the conclusions of this analysis at a press conference following the meeting. However, I will telegraphically re-present our main conclusions to put our suggestions for the future into the proper context. The Albanian economy is suffering from cyclical weaknesses, which appear in the form of a weak aggregate demand and are reflected in low and below-potential growth of the economy.
With greater capital buffers, the risk of liquidity runs should be reduced going forward. It should be noted, however, that use of contingent capital instruments, or any other potential changes to our current capital regime, does not obviate the need for an improved resolution process. Second, the Basel Committee is moving forward with its work in establishing liquidity standards for large, complex financial institutions. These liquidity standards would consist of two parts. First, there would be a liquidity buffer made up of high-quality liquid assets that would be of sufficient size so that the firm could manage a stress event caused by a shortterm loss of investor confidence. Second, there would be rules concerning the degree of  7  Supervision could also be brought to bear to limit the tendency for firms to reduce their capital and liquidity when provided with a credible liquidity backstop. BIS Review 143/2009  7  allowable maturity transformation. Long-term illiquid assets would have to be largely funded by equity and longer-term borrowing, not by short-term borrowing, such as tri-party repo. Third, the Federal Reserve is working with a broad range of private sector participants, including dealers, clearing banks, and tri-party repo investors to eliminate the structural instability of the tri-party repo system so that tri-party borrowers are less vulnerable to runs.

For example, the Federal Reserve introduced the Commercial Paper Funding Facility (CPFF) to reduce rollover risk in the commercial paper market, the Federal Reserve and other central banks’ massively expanded the ability of banks to obtain dollar funding through the TAF and associated foreign exchange swap programs; the Treasury guaranteed money market mutual fund assets; and the FDIC increased deposit insurance limits and set up the Temporary Liquidity Guarantee Program (TLPG) to backstop bank and bank holding company debt issuance. Having described “what” happened on the liquidity front during the crisis, I next want to examine, in a bit more detail, “why” it happened. To do this, I will lay out a simple conceptual framework that I will then use to assess what can be done to mitigate the risk of such runs occurring in the future. As a starting point, I will talk about how unsecured lenders react in a crisis, and then I will consider the behavior of secured lenders. Unsecured liquidity providers run for two basic reasons. First, they run because there is a risk that the company they are lending funds to is insolvent. In other words, there is a risk that the assets will be worth less than the liabilities, creating the potential for loss to the creditor. The second reason that unsecured creditors run is the risk that they will not be repaid in a timely way.
Broken lines represent the Riksbank’s forecasts. Repo rate and expected repo rate Per cent, all agents 5  5 Repo rate Repo rate expectations 5 year ahead  4  4  3  3  2  2  1  1  0 Jan-07  0 Jul-07  Jan-08  Jul-08  Jan-09  Jul-09  Jan-10  Jul-10  Sources: TNS SIFO Prospera and the Riksbank  M onetary policy expectations Per cent, money market participants 5  5 Repo rate Forward rate 2010-06-23 Forward rate 2010-08-18  4  4  3  3  2  2  1  1  0  0 06  07  08  09  10  11  12  13  Sources: TNS SIFO Prospera, Reuters EcoWin and the Riksbank  16  BIS Review 109/2010  The Riksbank’s outstanding loans SEK billion 400  400 SEK, commercial paper SEK, variable rate SEK, fixed rate  300  300  200  200  100  100  0  0 Jul-08  Jan-09  Jul-09  Jan-10  Jul-10  Source: the Riksbank  BIS Review 109/2010  17

As a result, total outstanding ringgit bonds increased by 10.7% to RM363 billion, which is equivalent to 81% of the gross domestic product. The general market conditions have also remained favourable for both issuance and trading activities, given the low inflation and interest rate environment and the strengthening of economic fundamentals. The Islamic bond market has also experienced exceptional growth. In 2004 the market expanded by 13.4%. To further enhance market turnover, Bank Negara Malaysia announced in January this year the usage of repurchase agreements as a monetary policy instrument, introduced the Institutional Custodian Programme to enable borrowing and lending of securities, and provided a securities lending facility for principal dealers. The implementation of these measures are aimed at improving the price discovery process and increasing the efficiency of capital allocation within the financial system. To facilitate the further development of the Islamic bond market, the Government has also imposed tax neutrality between the treatment on Islamic and conventional capital market products. BIS Review 29/2005  1  It has been just one year since we allowed Multilateral Development Banks and Multinational Corporations to issue Ringgit denominated bonds in Malaysia, and we are now witnessing the third issuance of such bonds by a supranational. In that, I am pleased to welcome the IBRD's issuance of its 760 million Ringgit Wawasan Bonds in Malaysia. We are pleased to note that the World Bank has decided to make its inaugural issuance structured in compliance with the Shariah.
If other government revenues fall, and the expenditure side of the government budget is shielded, the oil fund will have to foot the bill krone for krone. Chart: Probability of 50 percent decline in the size of the GPFG The risk of a sharp decline in the size of the fund is further illustrated in this chart, which shows the probability of a 50 percent decline in the fund over a ten-year horizon.4 In the initial year, fiscal spending of oil revenues is around 3 percent of the fund’s value – that is to say close to today’s level. Government expenditure is then assumed to grow in pace with the expected growth of the economy, which means the expenditure side is shielded even in a situation with declining revenues. When and if that occurs, the oil fund will carry the cost. With a 60 percent allocation to equities, the probability of a 50 percent decline in the fund over a ten-year period is just over 1 percent. A higher equity share increases this risk, but the risk is still moderate. However, with a higher level of oil revenue spending, the downside risk increases. The yellow bars illustrate a scenario where oil revenue spending in the initial year increases to 4 percent – a familiar figure. In that case, the risk of having to draw down the fund increases considerably. The probability of a 50 percent decline in the fund increases threefold.

Shaping the global governance structure At their summit in Pittsburgh last September, the G20 leaders “…designate[d] the G20 to be the premier forum for our international economic cooperation”. As an effective and powerful group, the G20 featured prominently in the broad international efforts to stabilise the global economy in late 2008 and early 2009. Without its prompt and comprehensive action, the consequences of the crisis would have been much worse. Among the G20 measures of 2009 were the efforts to strengthen confidence in international financial institutions, the IMF in particular, to permit it to play an effective role in tackling the crisis. Indeed, the G20 increasingly uses the IMF as an instrument of its policy implementation. 4  The membership of the G20 comprises Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Korea, Japan, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the United Kingdom, the United States and the European Union. The G20 was formed as a new forum for cooperation and consultation on matters pertaining to the international financial system. It studies, reviews, and promotes discussion among key industrial and emerging market countries of policy issues pertaining to the promotion of international financial stability, and seeks to address issues that go beyond the responsibilities of any one organization. 5  The International Monetary Fund (IMF) is an organisation of 186 countries, working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world.
From that, we’ll see that a systems perspective can explain why our attempts at control sometimes fail and what we can do about it.7 A key insight from systems thinking is that controls are part of a system. Controls interact with other controls and with the production process. One implication of connectedness is that changes to any part of the system can spillover and affect other parts. Controls that work well separately may not work well together. That’s one reason why controls created in isolation and added incrementally can create unexpected results. It’s a weakness of control systems that have grown through an ad-hoc approach of “see a problem, add a control.” Let’s walk through a scenario where controls don’t behave as expected or intended. On Sunday, you run a business resumption exercise to test the ability of your primary data center to fail over to your backup data center. The test appears to be a success, and you have some useful lessons learned to make the failover process run better next time. But, when you come to work on Monday morning, something is wrong. It turns out the test corrupted customer account data. Your call center is overwhelmed with questions and complaints, because your billing system sent a blast email with overdue payment notices to all of your customers. In a simple world, controls solve problems, they don’t create them. In the real world, the control and production systems are linked, so the failed execution of a control can, in and of itself, disrupt operations.

Hence, relevant stakeholders in the country formulate, implement, revise and re-implement economic and other policies to achieve such goals. Whatever the policy we formulate and pursue, the ultimate aim is to raise living standards of the nation. At the same time, we are all aware that it is compulsory to have higher economic growth and fair distribution of benefits of growth for achieving higher standards of living. The issue is, how can we achieve higher rates of economic growth? Theory will say savings, investments, diversification, technology, hard work, attitudes and perceptions. Yes. All these are important and they have certain importance in a country’s overall performance. However, in a highly competitive, globalized environment with a limited resource endowment all of these factors would be second to productivity. For sustained prosperity, productivity is the key. Why is the productivity so important? Economists agree that, in the long-run, productivity growth is the principal means of improving living standards. The rate of productivity growth influences the economy in important ways, even in the short run, by affecting key variables such as output growth, employment growth, and the rate of inflation. So, as a first step, let us examine the need of productivity improvements in the current global and domestic economic context and the lessons of success by emphasizing on productivity, so that we could deal with this topic in a wider perspective. In my view, our economy should focus on productivity due to two important reasons.
If not too big to fail, it was certainly large enough to look after itself – as the Bank found out in1860. Two years earlier, the Bank had abolished the right of other banks to come to it for cash by discounting bills. The banks took umbrage. With Overend and Gurney playing the role of shop steward, they collectively withdrew £ million from the Bank over three days in an attempt to bring the Bank, if not to its knees, then at least to its senses. Dark, anonymous messages were sent to the Bank, presumably not by Twitter, warning: “Overends can pull out every note you have”.1 In the event Overend eventually caved, returning to the Bank the notes they had withdrawn apologetically – or at least semi-apologetically, as the notes actually came back cut in half. Six years later in 1866, when Overend and Gurney asked the Bank for an emergency loan of £ the answer was “No”. The Bank won this battle, but was to lose decisively the war. Overend and Gurney failed. The City shook. Panic took hold. The Bank was forced to lend £ million – ten times the initial sum – to support other banks. There was a chorus of disapproval. The Bank’s role in crisis management would never be the same again. Supporting the financial system Criticism of the Bank’s role in the Overend crisis came prominently from Walter Bagehot, then-editor of The Economist and Bank-of-England basher of his day.

Although the correction started with a bursting property bubble in the US, it has expanded into a global financial crisis and brought on recession throughout the advanced economies and a sharp deceleration of growth elsewhere. The immediate priority is to deal with this downswing. The extraordinary measures we have taken in this country and others are having a positive impact but we may need to do more. We must also learn  6  BIS Review 145/2008  some lessons for policy in the medium term including the need for far better coordination of policy internationally and the need for some new policy instruments alongside interest rates to dampen the financial cycle. Chart 1: GDP and employment  Source: ONS (including Labour Force Survey)  BIS Review 145/2008  Chart 2: House prices and earnings  Source: Halifax, Nationwide, ONS and Bank calculations  7  Chart 3: Major UK banks’ customer funding gap, household saving ratio and foreign interbank deposits  Source: Bank of England, Dealogic, ONS, published accounts and Bank calculations. Chart 4: CPI and households’ inflation expectations for the year ahead (scaled to match CPI on average)  Sources: The AlphaMonitor: consumer, YouGovAlpha, Bank of England, Barclays Capital, Citigroup, GfK NOP, research carried out by GfK NOP on behalf of the European Commission and YouGov.
Employed persons in each sector in per cent of the total number of employed persons. Source: Statistics Sweden  16 [17]  Figure 3. Development of the Swedish krona, Norwegian krone and New Zealand dollar against the euro Index, 2015 = 100 120  120  110  110  100  100  90  NZD  90  NOK SEK 80  15  16  17  18  19  80  Source: ECB  17 [17]

The first years of the new regime were not easy, and included frequent numerical target misses. Nevertheless, the Czech Republic enjoys low inflation, and inflation expectations seem to be firmly anchored at low levels at present. Monetary policy decision-making is rule-based and transparent, thereby enhancing the credibility of the CNB. Such a framework allows an independent central bank to commit credibly to its long-term goal of price stability, and at the same time preserves enough discretion for an active anti-cyclical monetary policy that takes into account not only inflation, but also other factors such as variability of output. 2  BIS Review 11/2004