samchain/econo-pairs-v1 huggingface dataset:
The foreign loan that the Central Bank was authorised to take was its largest on behalf of the Treasury so far. It can only be said that this was a highly successful measure –in fact, a respected international financial journal ranked it one of the ten most successful international bond issues worldwide last year. The borrowing terms were very favourable and of course reflected the confidence enjoyed by the Republic of Iceland in the market. The Central Bank’s greatly enhanced capital position and stronger foreign reserves do not signal any shift in its policy, but represent a natural response to changes in the environment in which the Bank operates. At last year’s annual meeting we all had serious concerns about the peculiar discussion and sometimes unfounded speculation aired then about the Icelandic banks, their position and strength. There is no doubt that this debate and the ensuing events made conditions tighter for the banks for a while. The banks responded firmly to the uncomfortable position that had arisen. They made great efforts to explain the structure and organisation of the Icelandic banks. This was no half-hearted measure, but a steadfast and confident approach which produced results. The banks adjusted certain aspects of their operations and operating environment in response to relevant criticisms, and dismissed what was less relevant with explanations, reports and candid communication, at large meetings, small meetings and man-to-man, depending upon which was most productive.

The exchange rate has been relatively stable after the adjustment that took place in the first half of last year, and the króna is currently somewhat stronger than historical measures would warrant, although it should be admitted that determinism is probably not the most suitable approach for assessing currency developments. One reason for uncertainty about the exchange rate is the large current account deficit, as well as the fact that it can easily be driven by factors over which we have no control, given how closely Iceland’s financial sector is now integrated with global financial markets. A central bank with a legislative and regulatory remit to target inflation is of course pleased with such inflation developments, but would prefer them to be built on a more solid foundation. Domestic demand growth has declined, but rather more slowly than the Bank had hoped. The current account deficit is large and will also contract more slowly than the Bank would have desired. Demand remains buoyant in the housing market and there are indications that the rate of credit growth may be on the increase again. For these and other reasons, the Bank will remain on the alert and not ease its monetary stance until even clearer signs emerge that a lasting change has been established. Equity prices have soared in Iceland in recent years.
In this connection they will transfer in full the assets assigned to their banking activity to the central credit institution, in exchange for shares, and they will collaborate efficiently in the management and control of the activity pursued by this bank. BIS Review 173/2010  3  Making use of this possibility is a decision incumbent upon the managers of IPSs, and one which should be considered without delay, if funding markets so demand. Or if this should be so required by the even more demanding capital market, to which access will prove vital. In adopting investment decisions, this will call for a high level of certainty in projects and in business structures. To access bond markets and cover maturities, it may suffice, along with the full sharing of profits and losses and the cross solvency guarantee, to transfer to the central entity a portion of the group’s assets and liabilities (normally that associated with wholesale businesses and branches located in territories in which it does not operate exclusively). We shall find out if this is sufficient from January 2011, when significant volumes of external financing will have to be renewed. However, probably, when it is necessary to raise capital, by issuing shares of the bank located at the heart of the IPS, a larger contribution of strategic assets and liabilities to this bank will be needed, if it is desired to give expectant new members complete certainty regarding the specific assets and liabilities they are going to share and promote as a shareholder.

In the United States the real earnings trend since 1940 has been virtually constant between 2% and 3%, while - as I just mentioned - the real return on shares shows a trend break after 1982 (Fig. 3).2 Are present share prices fundamentally justifiable? I shall now use a simple model to examine whether the present level of share prices can be justified in fundamental terms.3 Simplifying somewhat, this model equates the value of a share with the present value of the future income the share is expected to generate. A valuation in P/E terms accordingly rests on the assumptions that are made about these future incomes - the future growth of the company’s earnings - and the factor by which these incomes are discounted - the stock market’s expected return. We can insert alternative values for these assumptions to find the combinations that might justify different P/E ratios (Fig. 4). It will be seen that a P/E ratio of 14 can be warranted if the expected real return is 6% and the real growth of earnings averages 2.5%. These figures are all approximately in line with the historical trends.
Government bonds were swapped for covered bonds issued by banks and normal lending activity was restored. However, this was not the first time the Government had used swaps to stimulate the real economy. We did so around 200 years ago...  A swap of government bonds for privately issued securities was used already in 1819 when Norway emerged on the scene as a sovereign country after the Napoleonic wars. The 1819bonds were swapped for bills of exchange issued by farmers and merchants in the domestic market. With these bonds as collateral they managed to raise sufficient credit to import seed to secure important supplies to farmers and merchants in this difficult period in Norwegian economic history. This is a historical example of how financial markets underpin economic growth. BIS central bankers’ speeches  1  More generally, financial markets contribute to economic growth in three ways:   They create credit to make it available for real investment.   They allocate credit to the most profitable investment projects.   And they improve risk sharing in the economy. The caveat is that they create the credit volumes that they find privately optimal, and allocate it to the projects that are most profitable to them. Neither the credit volume nor the credit allocation is necessarily socially optimal: this is one basic reason why financial markets are and should be regulated. The next question is: How strictly should they be regulated? When does regulation severely impair the positive effect from financial markets to economic growth?

The government authorities, the Central Bank and the Financial Supervisory Authority (FME) have already made a formal agreement on joint monitoring of signs of weakness in financial institutions, and contingencies for responding to them. This agreement has been under preparation for a long time, is similar to those in effect in other advanced economies and has nothing to do as such with the current market unease. Developments following the structural changes in the housing mortgage market have left the arrangements for the Housing Financing Fund in an untenable position. Moves to rectify this situation have been unduly delayed. Interest rate formation in this market has become unrealistic as a result, which in turn has an adverse effect on the Central Bank’s efforts to cool the economy. The Prime Minister’s recent declaration concerning the Housing Financing Fund is important and has met a positive response. But the declaration needs to be followed through in practice, as soon as possible. A few years ago it was decided to separate the activities of the Central Bank and banking supervision, drawing on developments elsewhere, in particular in the UK, which had a widespread influence. This may well not have proved as successful everywhere as was hoped. Most of the banks in the UK are foreign banks, and the share of domestic banks is small. The opposite is true in Iceland. In spite of their large and growing activities abroad, all the Icelandic financial institutions are classified as resident companies.
b)  Support for policies  Ultimately sound economics is sound politics as well. But the problem is that economic measures may take time to bear fruit. In other words reforms usually have immediate costs and the benefits are (sometimes) distant. Let me stress again that policymakers must educate the public at large to get their support. If this is not the case, it may be a serious obstacle to rapid transition. With the benefit of hindsight and from the perspective of a central banker I would say that in the past we lacked not so much sound economic decisions but good public relations for our policies. This is especially true in the case where the central bank initiated bankruptcy procedures or withdrew licences for 25 banks which was something unheard of in Croatia in the last fifty years. Let us not blame only people or politicians for their resistance to those measures. New economic policy is like a new 7  BIS Review 43/2000  product. It is the responsibility of the producer - the policymakers - to overcome the information assymetry and inform the consumers - the population and the politicians - of the benefits of this product (bankruptcies in the banking system) and sell it successfully. If central banks in transition economies want to be successful they should be much more “customer-oriented” and educate the public and politicians about the benefits of their main products: price stability and financial stability. Otherwise, they risk a weak demand for their services.

In a market environment there are  BIS Review 43/2000  2  so many more decisions to be taken and almost each of them is associated with risk and its consequences. b)  In socialism there was no reason to worry too much about the future. Free schools, free education, free health insurance, no unemployment, secured pensions, in short very few incentives to take a long-term perspective on life. Questions like: How am I going to finance my children’s education? Should I save for my old age? Will I be able to afford a mortgage if I’m unemployed? were very rarely asked under socialism. So, it was comfortable to think only about the present, as someone else - “the socialist system” - would take care of the future. The same reasoning could be applied to companies. Why worry about the long-term market developments, when the almighty central planner would take care of that? For those reasons it is even more challenging for policymakers in transition to explain their goals and actions clearly to the population than it would otherwise be. In reality we do not seem to have acted consistently in pursuit of these goals of whether transition benefits the people and whether they understand the process. Sometimes the people get left behind and we embark on a reform without asking whether it fulfils the ultimate goal of raising people’s living standards.
The prices of commercial properties and private housing are also analysed not least because they reflect the value of the major part of the collateral that is pledged for loans from banks and mortgage institutions. Insofar as your banks conduct activities in foreign countries, stability surveillance also needs to encompass developments in these countries to ensure that negative developments will not destabilise your banks. Second, the major banking groups are analysed in various respects. Profitability trends illustrate the ability of the banks to build up reserves for future unexpected losses. Moreover, there is always the strategic risk that a bank with weak profitability will be tempted to try out new, bold but risky lines of business in order to generate a higher return on equity. Our analysis of the banks’ credit portfolios provides an indication of how loan losses are likely to develop in the coming year or two. Another aspect of the analysis relates to banks’ liabilities. Traditional banking involves accepting deposits and using the funds for making loans. People’s growing propensity to save in other instruments than bank accounts has forced the banks to finance a major part of the growth in credit by borrowing, mostly short-term funds, in the capital market. The structure of bank funding provides an indication of the risks in bank liquidity. Monitoring this is perhaps the most difficult part since the liquidity situation is liable to change very rapidly. 3.

Jean-Pierre Roth: Recent economic and financial developments in Switzerland Introductory remarks by Mr Jean-Pierre Roth, Chairman of the Governing Board of the Swiss National Bank and Chairman of the Board of Directors of the Bank for International Settlements, at the end-of-year media news conference, Zurich, 14 December 2006. *  *  *  As stated in our press release, the Swiss National Bank is raising its target range for the three-month Libor with immediate effect by 0.25 percentage points to 1.50–2.50%. The SNB intends to hold the rate in the middle of the target range for the time being. Economic activity in Switzerland is very robust. Next year, the economic trend is likely to continue favourable, albeit somewhat less pronounced. This will have a positive effect on the labour market. The National Bank is expecting real GDP to grow by just under 3% in 2006 and by around 2% in 2007. Declining oil prices have pushed back inflation. Average inflation for 2006 is likely to stand at 1.1%. By lifting the target range, the National Bank ensures that the inflation outlook will remain favourable, even in view of the high level of utilisation of economic resources. On the assumption of an unchanged three-month Libor of 2.00%, it expects annual inflation to reach 0.4% in 2007 and 0.9% in 2008. If the economy performs as expected, the SNB will further pursue its strategy of gradual normalisation of its interest rates.
But this is a key determinant of how much the economy can grow before igniting inflationary pressure, as well of the size of the structural fiscal deficit that needs to be closed. Would better or different statistics have helped us in anticipating the recession, in monitoring its evolution and in setting policy? Aside from the important, but unfortunately rather challenging, matter of measuring the margin of unused resources in the economy, I do not believe that the recession has highlighted any obvious lacunae in our conventional macroeconomic indicators, though it has certainly presented us with plenty of puzzles. (It has highlighted shortcomings in economic models, but that is a different story.) Rather the key information gaps have been inside the financial sector. Some of these we have been able to fill. For instance, in 2007, following the example of the Federal Reserve and the European Central Bank, we had happily just decided to launch a regular survey of the banks in order to provide more information on credit conditions. That has proved invaluable during the recession as a guide to how the availability of credit was evolving. If we hadn’t already decided to launch such a survey, we would certainly have needed to introduce one. We were already quite well served with information of key monetary and credit aggregates, which have naturally taken a more prominent role in our analysis during the crisis. We did, however, find that following the collapse of Lehman’s, we needed a richer and timelier picture of banking sector developments.

François Villeroy de Galhau: Five lessons learned for monetary policy from the latest years Remarks by Mr François Villeroy de Galhau, Governor of the Bank of France, at the Paris School of Economics, in discussion with Olivier Blanchard, Paris, 28 June 2023. *** Looking at the last three years, which were rich in unexpected events, I would risk two general lessons, and three more technical ones: 1. The first is that we must remain modest, humble: monetary policy is not omnipotent; it cannot be the only game in town. And we must be nimble, able to react to surprises with agility. 2. That said, monetary policy was efficient in preventing deflation during Covid-while not creating the present inflation. 3. On a more technical note: we certainly should work with less forward guidance. I wouldn't throw it away completely but if we use it again in the future, forward guidance should be (i) state dependent and not calendar based except in the very short term (ii) indicative and not committing. 4. We should keep our inflation target of 2%. It served us well, explaining in part why inflation expectations remain rather well anchored; we shouldn't change it, while keeping in mind that the target is for the medium term. 5. Transmission lags are a key question, and we should dig more into this issue.
TABLE 1 THE BANK AND PRIVATE SECTOR ACCELERATORS COMPARED  Purpose  Duration of firm engagement Business model  8  Private sector  Bank of England (BoE)  accelerators  accelerator  To help ventures define and  To work with innovative firms,  build initial products and  helping them to understand  identify consumers and  the BoE’s needs, and the BoE  investors  to understand the technology  3-6 months  1-3 months  Investment in successful firms (can also be non-profit)  Non-profit, no equity taken  Selection  Competitive, in cohorts  Competitive, in cohorts  Venture Stage  Early  Generally later stages  Structured programme  PoCs structured according to  similar for all firms in the  central bank use cases and  cohort, culminating in a  success criteria. No  demo day  comparison between firms  Programme  Resourcing and Mentorship Venture location  Primary resourcing from start-up staff but with support from mentors  Start-up staff work with BoE subject matter experts  On-site  Mostly off-site  In other respects, the Bank’s Accelerator operates in a similar way to traditional accelerators (Table 1). We undertake structured Proofs of Concept (‘PoCs’), organised in cohorts to ensure appropriate resource allocation and focus. Firms are chosen through an open, competitive selection process on the basis of a well-defined central banking use case. They work closely with the Bank’s subject matter experts for a time-limited period.

Ripple  This PoC explored the synchronisation of two different fiat currencies between two simulated RTGS systems built on the cloud. We wanted to understand the impacts on settlement risk, speed and the efficiency of cross-border payments. Completed  Experimentus ORB  We applied the firm’s tool to historic projects to visualise how they had performed against a range of standard key performance indicators. Completed  Distributed ledger technology  Data analysis Distributed ledger technology  Cohort 4  Company  Chain  Data analysis  Reportix and NTT Data  Machine learning  Digital Reasoning  This PoC is intended to explore how distributed ledgers can be configured to enable privacy amongst participants whilst keeping data shared across a network. This partnership of firms will investigate innovative storage solutions for regulatory reporting data. In particular, the processing and storage of XBRL based data to facilitate analysis and visualisation. In this PoC we want to understand the sentiment in a sample of publically available unstructured text data and how this might support the work of our supervisors. Completed Completed  In progress In progress In progress  Machine learning  Mindbridge Analytics Inc  This second phase PoC will examine the ability of the tool to analyse larger data sets and a broader range of classification schemes and learning algorithms. In progress
In this case, the actual monetary policy will be more contractionary, exactly in a situation in which a more expansionary monetary policy is desired.9 Secondly, in my opinion, it is a mistake to continue to accept this lower limit and not thoroughly reassess it at every monetary policy meeting, in particular as later information and analysis indicates that very low interest rates do not give rise to any problems with financial stability or the financial infrastructure. It has also been claimed that it would be wrong to lower the repo rate path during an economic upturn, even if a very deep recession is still prevailing. I do not understand this argument. Whether it is right or wrong to lower the repo rate path should, in my opinion, be determined solely by whether the stabilisation of inflation and resource utilisation would be improved or impaired by a lower repo rate. I cannot discern any reason for it to be less important to stabilise inflation and resource utilisation as efficiently as possible now that the economy has touched bottom and the prevailing deep recession has become somewhat less deep. Transparency and mean squared gaps  Let me finally address the role of the mean squared gaps in improving the transparency of monetary policy. Monetary policy has a major impact on both inflation and the real economy. The Executive Board bears a considerable responsibility for its decisions and their consequences for inflation and the real economy.

A common use case for crypto tokens is payment. But does that make them Money? Money – as we learnt in Economics 101 – serves three functions: as a medium of exchange, a store of value, and a unit of account. No crypto token currently meets these three functions in sufficient measure to qualify as Money. My colleagues on the Financial Stability Board – Agustin Carstens and Mark Carney – have spoken at length on this subject recently, with erudition and eloquence. Let me briefly echo some of the key points. With the possible exception of the dark web, crypto tokens are not widely accepted as a medium of exchange in any market, let alone across any variety of transactions Payment transactions in crypto tokens are often slower and more expensive than conventional electronic transfers of funds. Crypto tokens cannot be a store of value if their prices fluctuate so much. Since the beginning of last year, the daily value of Bitcoin against the US Dollar has fluctuated about 20 times more than the Singapore Dollar did against the US Dollar. People may buy some crypto tokens to speculate on their values. But with such volatility, I doubt they will put their retirement savings into them. Crypto tokens also fail as a unit of account. How many entities do we know of, which maintain 1/6  BIS central bankers' speeches  their financial statements in crypto tokens? So, does it mean that crypto tokens can never become Money? With technology, we can never say never.