samchain/econo-pairs-v1 huggingface dataset:
But it is human creativity nonetheless, just as Hamlet was the creation of Shakespeare not Guttenberg and the theory of relativity was the creation of Einstein not Lippershey. What applies to board games applies to other spheres of human endeavour. Driverless cars are not, in the main, driverless. Most have a human override for situations where the algorithm experiences circumstances outside its sphere of knowledge, the automotive equivalent of Move 78. Alexa hears better than me and learns faster than me. But I can still deliver a better talk about creativity to students at the GSA, even if I did draw on her knowledge in putting it together. If that ever changes, I can always pull the plug. Institutions for the 21st Century At the same time, this co-evolutionary path will not be an easy one. Even if (and it is a big if) as many jobs are created as are destroyed by the Fourth Industrial Revolution, there will be transitional costs and societal casualties to manage. As during past waves of innovation, making a success of this revolution will require a reworking of the social infrastructure if these costs and casualties are not to tear the social fabric. There are many possible dimensions of this reformation. One of the most important is close to the GSA’s heart – education. This is also an issue close to the Bank of England’s heart. Education on economic and financial matters is one of the public goods the Bank can provide and is providing.

This can in turn give rise to an acute threat to financial stability and ultimately to the economy as a whole – not only in Sweden but also in our neighbouring countries, where Swedish banks have operations. Via FX swaps which have maturities of different lengths. These must be renewed gradually and their prices alter. 6  5 [14]  There is a process consisting of many stages behind the lending for Swedish mortgages and corporate loans. In this process, both the Swedish banks and their counterparties on the foreign exchange market are dependent on the funding in foreign currency functioning constantly. Different currencies in the banks’ balance sheets (a simplified example)  How can we then best manage the banks’ increased liquidity risks in foreign currency? A natural starting point is that the banks – just like other private commercial actors – should manage their liquidity risks themselves. They therefore need to insure themselves by having enough liquidity reserves and sufficiently stable funding in foreign currency. This reduces the risk that the government will have to intervene in the event of a crisis. Hopefully, it also gives the authorities a little more time to take in the whole situation and to find an appropriate solution if problems nevertheless arise. A liquidity buffer can to some extent also be regarded as a “deductible” that can at least on the margin reinforce the banks’ incentives to manage their liquidity risks.
Minimum conditions would be first that Member States actually abide by common rules – the Stability and Growth Pact and the Macroeconomic Imbalances Procedure – and second that they actually conduct policies consistent with the euro area collective economic strategy. However, contrary to the ESM instruments that have been used so far, access to the SLI should not be conditional on the implementation of an adjustment program. Its design would be such that it does not involve a stigma for Member States. The issue of governance brings me to a broader reflection on the idea of a European Monetary Fund (EMF). An EMF would only make sense if its scope of action and its governance went beyond those of the current ESM. Otherwise, why would we give it a different name? The scope of action of a potential EMF should not be limited to crisis management. We should entrust it with the role of crisis prevention in a broad sense, including contingent lending through the SLI. This would require decision-making processes that would not be tied up by veto-based governance. 2/4  BIS central bankers' speeches  As President of the Eurogroup and Member of the European Commission, the Finance Minister of the euro area would logically chair the Board of Governors of an EMF and play a stronger role in situations that require Board level judgement.

In addition to this commitment, I also suggest creating a Stabilisation Lending Instrument at the euro area level, and I would like to detail some key aspects regarding its objectives and operational efficiency. I will then talk more broadly about a possible European Monetary Fund. Let me start with the objectives. The SLI would provide loans to euro area Member States faced with an asymmetric economic shock, in order to support their countercyclical policies. Finland for instance was faced with a triple asymmetric shock in the late 2000s, due to the collapse of Nokia, the decline of the paper industry and the aftermath of the Russian crisis – real GDP contracted by 9% in 2009. Such a shock could also stem for instance from temporary political uncertainty – as long as it is not fuelled by inadequate economic policies – from natural disasters or from an irrational loss of confidence in the financial markets resulting in excessive pressure on the sovereign spread. The SLI would be a complement to and not a substitute for national stabilisers. It would help Member States not to abandon their long term investments, especially by preventing an unwarranted widening of their financing conditions. Beyond this Stabilisation Lending Instrument, the creation of a “rainy day fund” with fiscal resources could be considered at a later stage once confidence and economic convergence between Member States have increased. On the operational efficiency of the SLI, access to the instrument should be simple, subject to carefully chosen macro-financial criteria.
The key interest rate has been reduced by 5¼ percentage points and is now approximately the same as among our trading partners. The krone has depreciated over the past year, and is in line with the average for the 1990s. Monetary policy is expansionary. This is reflected in low after-tax real interest rates as shown in the chart. The low interest rate level has reduced household net interest expenses. This has increased household purchasing power considerably. Household demand will probably be the most important driving force in the Norwegian economy in the period ahead. Private consumption has a considerable impact on overall demand and activity and accounts for 60 per cent of mainland GDP. Low inflation and reduced interest expenses will support strong growth in household real income. Even with a moderate wage settlement, real income growth may reach about 5%. In addition, improved labour market conditions will strengthen job security and lead to expectations of higher income growth. Against the background of high real income growth, improved job security and expectations of continued low interest rates ahead, household consumption is expected to exhibit strong growth. Growth in private consumption is projected at 5¼% between 2003 and 2004. Given this path, consumption will grow at a pace that is broadly in line with real income, with little change in the saving ratio. After falling last year, house prices edged up in autumn. At the end of 2003, house price inflation was high.

•  Lastly, even if some regions of the country are experiencing a scarcity of housing, there is no evidence of a real estate bubble developing such as we saw at the end of the 1980s. The inflation outlook thus remains positive. We are projecting an inflation rate of about 0.5% this year and 1% next year. It is unlikely that, in the months ahead, we will again see inflation rates below zero, as we did last March. Negative inflation would require a steep fall in the price of oil. The debate over deflation, which was so topical barely a year ago, is by and large no longer one of our concerns and has disappeared from the discussions among central bankers. Our interest rate cut in March 2003 was intended to protect us against such a development. The goal has been achieved. The need for reforms Events in recent years have shown once again that there is no way we can make ourselves impervious to disturbances emanating from the world’s markets. Such disturbances will inevitably impact on the development of our economy. This does not mean, however, that we are completely at their mercy: for a small country such as Switzerland, the best defence against external shocks is an efficient and flexible economy, capable of standing up to competition and adapting swiftly to changes in the international environment. However, we must also ensure that the problems caused by our internal structures, which are sometimes not ideally suited to current challenges, do not gain the upper hand.
The results obtained by those firms that have survived and the behaviour of Spanish exports, which have grown faster than German exports during the three years of crisis, are examples of how the Spanish private sector is reacting positively to the challenge of the crisis. And as I have said, all this has been achieved with a labour market that, unlike those in other more prosperous countries with greater social solidarity, forces firms to adjust through quantities. Thus, for the third time in thirty years, with the same institutional framework, our unemployment rate stands once again at over 20%. Nor should we overlook the damage to the productive fabric, which has occurred because so many firms have had to close owing to the lack of appropriate mechanisms allowing a flexible response to the crisis. The development of the crisis highlighted the need for structural reforms in areas like the labour market, public spending and savings banks. Initially the progress made in fiscal consolidation was very modest, but the outbreak of the sovereign debt crisis a year ago marked a significant turning point in the economic policy stance. Since then, government and Parliament have adopted an ambitious raft of measures, with the drastic reduction in structural public spending being particularly notable. This has involved unpopular measures such as reducing the wages of public sector employees, freezing all pensions except for the minimum ones and sharply reducing public investment, as well as the recent agreement to improve the sustainability of our public pension system.

As is well known, Spain’s current system for valuing assets is highly demanding, both in terms of the criteria for classifying assets as troubled and in terms of provisioning and write-downs. One example would be the treatment of savings banks’ exposure to the construction and real-estate development sector. The total amount of this exposure is € billion, of which 28 billion (13%) is made up of doubtful assets. That said, the requirements of the Banco de España force the banks to also record as potentially troubled investments, and make the necessary provisions for, assets acquired in payment of debt, as well as standard loans under surveillance owing to some observed weakness, even if payments are up to date. As a result of these rigorous asset classification criteria, as at 31 December 2010 savings banks were obliged to recognise € billion of potentially troubled lending to construction and property development, i.e. 46% of their total loans and receivables in this sector. This gives an idea of the transparency efforts made, which have been far beyond those required in other parts of the world. Accumulated specific loan loss provisions represent 31% of these “extended” troubled assets, and if we add the general provisions this percentage reaches 38%.
Expert judgment is needed because changes in the way the world  18  Hayek (1976) thought this temptation might be overcome by allowing competitive private banks to issue their own paper monies – the threat of competition would stop them over-issuing. But the costs of using several different monies, and the need to monitor the change in their relative values, reduce the benefits from using paper money as a means of payment. Competitive monies have arisen only rarely and usually in situations where government money is either absent or very badly managed. BIS Review 102/2006  5  works mean that monetary policy cannot be run on autopilot. 19 The members of the MPC are able to exercise their own discretion over how to meet the target. Members of the Committee are held publicly accountable for their individual votes. Third, these arrangements reflect both our experience of previous monetary failures and the nature of accountability in our political system. The separation between the elected government which sets the target and the Monetary Policy Committee which makes the month-to-month decisions on the level of interest rates necessary to meet the target is natural in our Parliamentary system. Since countries vary in their political constitutions it is not surprising that their monetary constitutions also differ. The apparent success of the MPC has led many to ask whether aspects of its design could be carried over to other areas of public policy.

Many jurisdictions have implemented macroprudential measures similar to those in Hong Kong, including loan-to-value ratio (LTV) caps and stress testing on the mortgagor’s ability to cope with interest rate rises in terms of their repayment ability. Challenges and mitigation: calibration of macroprudential policies 4. I would like to take this opportunity to share our experience gained since the GFC in operating our macroprudential measures on mortgage lending. My remarks would focus on what I call the “4Cs”. 5. Calibration: Driven by the low interest rate environment and limited housing supply, residential property prices in Hong Kong continue to grow since the GFC. This has posed increasing risks to financial stability in Hong Kong. In response, the HKMA implemented 8 rounds of tightening of the macroprudential measures from 2009 to 2017. Unlike monetary policies, there has been far limited literature on how macroprudential measures should be calibrated with respect to changes in asset price levels. The complex dynamics underlying the property market in Hong Kong has made it very difficult, if at all possible, to develop an ex ante framework governing how the HKMA should operate its macroprudential policies. So, what we have done is to tread extremely carefully in each round of adjustment. The HKMA has established a cross-departmental committee to regularly review whether the prevailing macroprudential measures would need to be adjusted, taking into account a host of factors including the property price trend, transaction volumes, domestic economic fundamentals and the external environment.
The world is undergoing dynamic shifts The world around us is shifting dramatically. To understand this shift, we should pay attention to five megatrends. The first is the shift in global economic order with the rise of Asia, including the rising prominence of ASEAN. The gravity of the global economy is moving to the East. Being the sixth largest economy and home to around 650 million people, there is an abundance of opportunity, hope and dynamism in this region. The financial sector will no doubt, be a key player in further catalysing the growth of ASEAN countries. The second is the risks brought about by climate change. Tackling climate change may be one of the biggest challenges for humanity in building a sustainable and prosperous future. It could lead to devastating, wide ranging and irreversible damage to our economy, society and the way we live. Economic losses in itself could be very significant, as high as USD20 trillion. Insured losses from effects of climate change have already increased five-fold in the past 30 years. The third is the rising income inequality that can threaten the fabric of our society. Consider this. The top 1% of the population has captured twice the global income growth of the bottom 50% since 1980. Worse still, inequality has persisted despite large transfers of public to private wealth in many countries. The fourth is the rising populism and protectionist policies. This can be seen in inward looking policies and anti-establishment views that have become more entrenched in parts of the world.

And such a system is not sustainable for future bad times. I believe this is a concern shared by policy-makers not only in our country, but also in other EU countries (such as here in Poland) and I hope that the coalition of like-minded states has the potential to grow over time. So let me repeat: until we have a full-fledged EU federation we should not build a half-baked one in the area of EU banking. And I strongly advise paying attention to the rules being prepared by the European Commission (for instance the Crisis and Resolution Mechanisms), which have the potential to be out of line with this proposed approach. 2  BIS central bankers’ speeches
His concern “that the variety and difficulty of administrative problems have so increased, and the tools and techniques for solving them have so developed, as to render administration more than ever a science” resulted in the creation of the Institute of Public Administration in 1957. To this day, the Institute continues to provide education, training and research to the public sector, enabling better policy making through a better understanding of the Irish economy. In addition, Whitaker was instrumental in setting up the Economic and Social Research Institute – the first institution to provide independent research and analysis of the Irish economy. 3 For example, nine Regional Technical Colleges were established during the 1970s to provide vocational tertiary level training. The Industrial Development Authority ensured that government funding of higher education adapted to meet businesses’ increasing demands for skilled labour in areas such as engineering and computer sciences, helping to ensure people could develop the skills necessary to work in the expanding sectors. 4 Whitaker, TK (1955/1956) 'Capital formation, saving and economic progress', Dublin: Journal of the Statistical and Social Inquiry Society of Ireland, Vol. XVIX, pp. 184-209. 2  2  All speeches are available online at www.bankofengland.co.uk/speeches  2  The Irish experience over the past half century reinforces the lessons learnt in the UK from the three profound technological revolutions – institutions are essential to smooth the major transitions and to ensure their promise is realised by as many as possible.

In contrast, the associated disadvantages could be linked to explanatory issues, the need for human resource adaptation, new data related concerns (privacy issues), or increased dependence on third parties. Nevertheless, as consumers and companies are embracing these new technologies, it is the policymakers’ role to identify potential risks and vulnerabilities and to formulate adequate policy responses and tools in order to adequately address them. Then again, Big Data is not the only example where views have dramatically changed over time – other relevant cases are the negative interest rates employed by the European Central Bank, an unthinkable measure in the pre-crisis era, or the unconventional monetary policy programs implemented by central banks worldwide. A valuable lesson to be learnt here is to always challenge preconceptions and the “status quo” in an ever-changing financial system. I will stop here saying that I believe financial stability should always look towards the future. In this direction, significant progress has been made recently through the development of Environmental, Social and Governance – or ESG – investing. In this new paradigm, policy makers should first and foremost learn to assess and monitor new types of risks, such as climate change, and evaluate their growing impact on financial sector stability.
Turmoil on the financial markets The financial storm of the last nine months has challenged our assessment criteria. Such turmoil poses considerable risks for the future. Before I deal with these issues, please allow me first to look at the factors which have brought us to this situation. After several years of rising home prices in the United States, there was a trend reversal to the downside which hit the high-risk sub-prime mortgage segment hard. It was when credit rating agencies began a massive downgrading of sub-prime mortgage-backed securities that the global financial markets realised the full enormity of what was happening. During the summer months of 2007, the prices and liquidity of these securities plummeted. This turn of events alarmed investors. Risk premiums subsequently increased, with uncertainty as to the extent of the losses incurred by banks triggering a general crisis of confidence among financial market participants. Liquidity on the major monetary markets became scarce and there was a return to volatility on the stock markets. Repercussions for Switzerland Switzerland quickly felt the storm due to the exposure of its financial sector. First, our two big banks saw their profitability fall sharply in the second half of 2007. Losses made in connection with their investment activities in the United States were a decisive factor in this respect. One of the big banks even required fresh injections of capital, such was the extent of the losses it suffered. The private banking sector and domestic banking activities continued to flourish, however.

Public institutions and private companies are equally called upon to engage in a high level of cooperation and coordination beyond competition, even if, and especially where no individual business case can be made. The scope of preparations for the Year 2000 is unprecedented in many dimensions. I cannot think of any other project which requires a similar degree of cooperation and coordination within and across organisations, industries, sectors and countries. Features of the Swiss case Even though preparations are generally making good progress in Switzerland, the country’s readiness chart exposes areas in which efforts will have to be strengthened. As far as the financial sector is concerned, which will be the focus of my remarks, there are some special structural characteristics involved in solving the Year 2000 problem. Our financial centre is the home of some large global players in the banking and insurance sectors as well as the place where numerous cross-border customer relationships are concentrated. We are, therefore, exceptionally vulnerable to international shocks. On the other hand, this also means that we must take on more responsibility with regard to the risk of inflicting damage on third parties through our own failure. A second phenomenon, which is germane to Switzerland, is the fact that - in comparison with other countries - the two big banks, CS and UBS, garner a very significant share of all banking transactions. Without doubt, this results in a high concentration of risk, but also yields some significant advantages.