samchain/econo-pairs-v1 huggingface dataset:
The other step concerns the choice of the central parity rate for entry in ERM II. As explained earlier, this, however, remains a multilateral decision to be taken by consensus and the matter, therefore, is not at our sole discretion. What are your expectations with regard to the central parity rate? As I have just pointed out, exchange rate stability is vital for our open economy and we wish to preserve this important feature of the currency during ERM II. We have reason to believe that this is not an unrealistic expectation. It is based on the outcome of a study the Bank carried out on the equilibrium exchange rate. According to economic theory, the central parity rate in ERM II stands a better chance of being sustainable over the two-year period if it corresponds to the equilibrium exchange rate. Thus, if one could identify the latter rate, one would automatically have an idea of the most appropriate central parity rate for ERM II. The equilibrium rate, however, is not specifically known and cannot be observed. It can only be estimated under a number of assumptions and the estimates are sensitive to the methodology used. Recognising this caveat, the Bank used several methods to estimate the equilibrium exchange rate. Both the methodologies and the results of the Bank's study were shared with local and foreign experts, from the ECB and from fellow national central banks in the EU and in North America.

That date is, to an extent, at the discretion of the national authorities. This approach builds on the premise that the considerable benefits of a currency union can only materialise when a close similarity exists with other euro area participants and a high degree of convergence has been attained with them. When this point has been reached, a prospective new member is much less susceptible to shocks which are not common to other members. This ensures that the monetary policy of the European Central Bank (ECB) is equally suitable for all euro area members - old and new. The two Cabinet meetings held recently assessed Malta's state of readiness in this regard, on the basis of a report prepared jointly by the Central Bank of Malta and the Ministry of Finance. The meetings also discussed issues related to Malta's participation in the exchange rate mechanism, also known as ERM II. The first decision which has to be made in fact concerns the timing and method of participation in ERM II because a Member State cannot adopt the euro without having successfully spent a minimum period of two years in this mechanism. While this decision is taken in a multilateral context involving various EU authorities, Member States and the ECB, the Maltese authorities nevertheless need to have a position. The Central Bank of Malta contributes to the formation of that position through its role as advisor to the Minister of Finance on financial and economic matters.
Patterns in these systems often self-replicate at different resolutions; they are “fractal”. 7 One interesting question is whether economic systems also exhibit self-replicating patterns. If so, this has implications for how we understand and model them. We consider these questions using a sequence of maps. Many of these maps are not new. For example, Philip McCann from the University’s Productivity Insights Network (PIN) has published an excellent book setting out a range of fascinating regional facts and maps. So too have others.8 These maps provide useful context when testing the Tip O’Neill hypothesis and when modelling and managing the economy. To provide the clearest visual guide, these maps are scaled by economic rather than geographic size – so-called cartograms.9 Each region is initially scaled to have the same geographic area and then rescaled in line with economic differences. This means some areas shrink (such as Scotland) while others expand (such as London) even without differences between them. This helps when visualising local differences. (a)  Differences between regions  To fix ideas, Charts 1a and 1b plot a map and an accompanying cartogram of population by region in the UK and, by way of comparison, Germany. It uses a resolution one-level below the national – administrative “regions” in England and each of Scotland, Wales and Northern Ireland. Comparing the map and cartogram suggests the UK has a significant demographic skew towards London and the South-East.

ECIs have been  constructed at the nation-state level and, more recently, at the local level in the US and UK. 54  One of the interesting features of these empirical ECIs is that they appear to match the theory: the greater the degree of specialisation and diversity, and the higher the ECI, the better the economic outcome. One rationale for this finding, proposed by Hidalgo and Hausmann, is that ECIs serve as a proxy of the degree of knowledge embedded in an economic area, knowledge that comes courtesy of specialisation and diversity. Charts 23 and 24 plot local authority level ECIs against measures of income per head and hourly earnings in the UK. They show a positive, statistically significant relationship. The same has been found at national level and among US states. The embodied-knowledge effect is, on the face of it, an empirically strong one. In a bivariate regression, ECIs account for around half of the regional variation in level of incomes and pay. Chart 23: Local authority-level ECIs and income per head  R² = 0.4799  GVA per head, £  140 120 100 80 60 40 20  -0.1  -0.05  0  0.05  0.1  0.15  0.2  0 0.25  ECI  Sources: ONS Regional Gross Value-Added, ONS Business Register and Employment Survey (BRES) and Bank calculations. Notes: ONS regional gross value-added (balanced) by local authority in the UK for 2016 against economic complexity indices calculated using BRES. City of London and Westminster excluded from chart.
Access to other institutions like the European Investment Bank is also possible. (viii)  Development of the capital markets has also made it possible for corporates to raise long term finance. Stock markets enable firms to acquire much needed capital at relatively lower cost, hence facilitating capital allocation, investment and growth. (ix)  Other innovative financial products introduced on the international capital markets include diaspora bonds and carbon credit financial instruments. There is need for Zambian businesses to take advantage and understand these financial products in order to access funding from multilateral institutions. 5.0  Competition in the Zambian financial sector  The BoZ recognises that competition is an essential element in the effective and efficient operation of a market economy. In this regard, the licensing regime encourages entry of players that will foster integrity, innovation and competition while deepening and widening the financial sector. 4  BIS central bankers’ speeches  The presence of reputable financial intermediaries is expected to increase competition, which in turn would lead to an improvement in the quality of domestic financial services and allocative efficiency, reflected by lower operating costs and narrower margins. The increased efficiency of financial intermediation would eventually be translated into higher returns for domestic savings and greater efficiency in the pricing of credit and other risks and in the allocation of credit. However, despite the growth in number of financial institutions in Zambia, this development has not had a very significant impact on promoting competition, as most of the banks are small in terms of size.

For the Swiss mortgage market, there is currently only a small risk of a credit crunch. On the one hand, there have been no widespread excesses on the Swiss property and mortgage markets recently, which makes it unlikely that banks’ appetite for risk will decline to any great degree. On the other hand, opportunities for loan refinancing in Switzerland remain strong. The structure of mortgage lending in Switzerland is quite varied, and for banks the “Pfandbrief” mortgage bond is a refinancing tool that provides continuing strong opportunities for loan refinancing, and has experienced something of a renaissance since the financial crisis. As such, the already muted outlook for the Swiss economy is unlikely to suffer any additional impact from a credit crunch on the property market. BIS Review 107/2008  1
Sir Andrew Large: Financial instrument accounting Speech by Sir Andrew Large, Deputy Governor of the Bank of England, to the 13th Central Banking Conference, London, 22 November 2004. *  *  *  Introduction The recent furore over IAS 39 - the international accounting standard for financial instruments - has resulted in a situation which I think all agree is unsatisfactory. We now effectively have two versions of IAS 39, one proposed by the IASB, the other by the European Commission. I probably do not need to emphasise that meaningful accounting standards and their effective implementation are highly relevant to any central bank’s responsibilities for financial stability. They help to ensure the safe and efficient functioning of the financial system. So it is essential that accounting standards have a clear economic rationale, promote comparability and secure adequate disclosure. Only in that way can investors, creditors and others judge the positions and risks being run by financial institutions and hence exert market discipline, and perverse incentives be avoided. Together these can make an important contribution to financial stability. I suggest later that, despite intensive work to improve accounting standards for financial instruments in recent years, fundamental issues with financial stability implications remain to be resolved. One crucial question is: “Who and what are accounts for?” Another more specific issue is the appropriate role of fair value data. So what I want to do this morning is to discuss these issues in turn before commenting on the way forward regarding IAS 39.

Moreover, fair value accounting is consistent with the increasing use of mark-to-market techniques in risk management. Such techniques in part reflect a progressive but fundamental shift from the traditional banking approach of holding assets until maturity to today’s approach of managing on the basis of continually assessing the opportunity cost of maintaining the existing balance sheet. It is clearly beneficial to transparency if publicly-available accounting information as far as possible reflects the basis on which management actually run a business. However, there are a number of complications associated with the wider use of fair values. First, there is a question as to how one can obtain robust fair values for instruments which are not priced, even indirectly, in reasonably deep and liquid markets. Model-based valuation techniques may be used, but they may not be analogous to genuine market clearing prices. The issues here include determining the conceptual basis for valuation (“the model”), obtaining the necessary inputs, and avoiding slavish adherence to a model which may in some circumstances deliver misleading results. In other words how, and to what extent, can human judgement properly be used to modify the model? Second, there is the question of the economic relevance of unrealised gains and losses - particularly if they are not immediately realisable. For example, while information on changes in the fair value of bank loans conveys useful economic insights, it needs to be interpreted carefully.
AIG (American International Group), one of the world's largest insurers and the biggest in the United States, was rescued and, to all intents and purposes, acquired by the Federal Reserve, in an operation without precedent in the United States or the rest of the world. -  The collapse of Lehman Brothers led to loss of confidence and a standstill in numerous markets, including some that had until then been functioning reasonably well and that are fundamental to financing in the United States. Among these, the deterioration in the commercial paper market was particularly serious. After the Lehman Brothers bankruptcy, some money market funds with exposure to its debt recorded losses, causing investors to redeem their holdings. The funds were forced to sell large amounts of securities to pay investors, causing the market for the commercial paper of non-financial firms to be seriously damaged too. -  In Europe, investors were sceptical about the liquidity position of entities reliant on very short-term financing, subjecting them to fierce selling pressure on the securities markets. In the United Kingdom, what started as a problem for the largest mortgage lender (HBOS), which had to be bailed out by Lloyds TSB, spread to the whole banking sector, prompting the British government to launch an unprecedented intervention plan. -  The Belgian, Netherlands and Luxembourg authorities intervened in response to the problems at Fortis, a bank whose share price had collapsed, and the Belgian, Luxembourg and French authorities had to take action to deal with the problems at Dexia.

Ardian Fullani: Opening, extension and modernisation of the primary and secondary treasury bill market Address by Mr Ardian Fullani, Governor of the Bank of Albania, at a meeting with the Minister of Finance and representatives of all banks in Albania, Tirana, 8 April 2005. *  *  *  Honored ladies and gentlemen! First of all I have the pleasure to thank you for your willingness in finding the time to take part in this work meeting. I would also thank your technical staff for the devotion shown in dealing with this issue, which constitutes one of our priorities at the Bank of Albania. At the Bank of Albania conference on “Central banking in the time of integration” I launched, interalia, the idea of the need for qualitative developments in the banking and financial system and this as closely connected with the need for further increasing the intermediation role of this system in the economy. It is understandable that the implementation of this idea would simultaneously require the giving of more possibilities to the banking system, so that this system carries out its role better and more actively. The topic we are discussing today is in this line. I am strongly convinced that the treatment of this issue did not appear as something unexpected, but it is a logical result of the positive developments taking place so far and the banking system awareness to be more active in its role for raising public confidence in the system.
A further means of enhancing confidence and reducing vulnerability is to establish contingency plans, i.e. measures that will be resorted to should problems still arise in spite of all preparations. Such plans are not something that should be unique to the change of millennium; they should always exist in organisations in the financial sector. Many of the measures that have been taken in preparation for the transition to the year 2000 have focused on questions related to confidence. A high degree of confidence in financial markets is important if the markets are to function efficiently. For this reason, anxiety that the functioning of the market may be impaired or a lack of confidence in the payment systems, are enough in themselves to constitute a problem. 1  BIS Review 97/1999  Lately, comments have frequently centred around possible liquidity problems. However, the exact significance invested in the word liquidity is often unclear, as is what, fundamentally, could lead to problems. The word liquidity means “the capacity to quickly obtain funds for the settlement of debts”.1 In practice, the word liquidity is used to express a variety of phenomena. In my opinion, therefore, it may be appropriate to take a closer look at the concept of liquidity and to clarify the role played by the Riksbank in managing liquidity. The comment that liquidity in the market is poor often describes a situation in which major price changes occur even when turnover is low. To use market jargon, the market is said to be thin.

One explanation for this can be a low level of customer activity. Such situations frequently tend to arise at the end of the year, when companies and financial institutions have adjusted their balances in preparation for closing their books and therefore have little interest in modifying their portfolios. Judging by comments on the market, there are expectations that the period of low activity in the market at the end of this year could turn out longer than usual. In other words, uncertainty about the effects the change of millennium might have on interest rates and financing possibilities could lead agents on the market to make adjustments to their portfolios earlier than usual. On this view, one possible explanation for why the interest rates on loans and investments that run over into next year have risen could therefore be a higher liquidity premium, i.e. a rise in the price that reflects how easily a security can be sold on the market. However, it is important to point out that this type of liquidity problem – a thin market – has no direct connection with the practical liquidity management exercised by the Riksbank. The Riksbank’s role in liquidity management is rather to function as the banks’ bank. This leads us to a second definition of the concept of liquidity: the opportunities available to financial agents to obtain refinancing without needing to sell assets. Uncertainty regarding the future liquidity situation in both senses risks reinforcing the problems.
Debt There has been much comment on the build up of domestic debt in recent years. In aggregate, the ratio of household debt to disposable income is now over 150%, having risen from around 100% in the late 1990s. This upward trend is not unique to the UK, although the debt-income ratio here is a little higher than in most countries [Chart: 3]. Chart 3: Debt-income ratio across countries France Germany Netherlands Spain US UK Australia  Per Cent  200 180 160 140 120 100 80 60 40 20 0  97  98  99  00  01  02  03  04  05  Source: Data from Eurostat, the Federal Reserve and data sent direct from Reserve Bank of Australia. There are a number of key reasons for the increase, coming from changes both in demand and supply. Supply side factors include: a liberalised financial market place with new categories of lender and greater competition; new technology, in particular the widespread adoption of credit scoring techniques and data sharing that have given confidence to lenders in granting unsecured loans; and greater securitisation, enabling firms to write more business by diversifying and laying off the risk onto third parties without burdening their own balance sheets. On the demand side, there appears to have been a change in social attitudes towards debt that has made people more willing to borrow.

Or will protectionism rear its head? Although these may be slow burn, gradual issues, they could over time have a significant effect on labour supply. I would expect that those involved with monetary policy will have this area on their radar screens for many years to come. Such a new way of thinking about the labour market alters how we need to think about capacity in the economy in general and indeed the output gap in so many areas of the economy. Pensions and longevity The last of my four areas today is longevity and pensions. I hesitate to mention it, because for many this is an area more for social policy than for monetary policy. But for me there is a clear monetary policy dimension. I will not attempt a long commentary on the underlying issues. We are all familiar with the facts, both as they relate to the need to anticipate working longer; and to the policy of governments in many countries of transferring risk in pension provision from the state towards the individual. In addition we are increasingly aware that returns on many asset categories that are suitable for inclusion in pension funds have been more modest in recent years. For monetary policy the key issue is how and over what timeframe will these changes impact on savings, which at a domestic level are likely to have to increase to provide adequate income in retirement.
In addition to encouraging trends in the global economy, the stabilisation of output growth in the euro area has contributed significantly to this. However, the most recent industry and consumer surveys also give positive indications with regard to economic activity in the euro area. Therefore, it is likely that economic activity will accelerate in the second half of 1999 and the year 2000. When assessing the risks for price stability, the ECB does also monitor the external value of the euro. The weakening of the effective exchange rate of the euro, which remained at around 8% between the start of the year and early September, lent itself to an increase in import prices denominated in euro. Taking into account all available information, the outlook for the preservation of price stability remains favourable. However, recently inflationary risks have increased slightly. In the coming months it will therefore be necessary to monitor developments in the monetary aggregates and credit aggregates. In addition, the short-term effects of the increase in oil prices and exchange rate developments on consumer prices need to be taken into account. The latter factors should not affect the outlook for price stability as long as wage increases remain moderate. The wage round for the year 2000 will, however, play an important role in future price developments. On the basis of this current assessment of the monetary, financial and economic situation, the Governing Council of the ECB left the central bank interest rates unchanged at yesterday’s meeting.

The publication of this definition also provides the public and the European Parliament with clear criteria for assessing the success of the single monetary policy, thereby rendering the Eurosystem and its policy both transparent and accountable. The Eurosystem defines price stability as a year-on-year increase in the Harmonised Index of Consumer Prices (HICP) for the euro area of below 2% to be maintained over the medium term. The wording “below 2%” clearly delineates the upper boundary for the measured rate of inflation that is consistent with price stability. At the same time, in this context, the use of the word “increase” implies that deflation – i.e. a prolonged decline in the price level – is not consistent with price stability. The price stability objective must be achieved both in the medium term and the long term. On the one hand, this objective has been set in order to take into account the variable and somewhat unpredictable time lags affecting monetary policy. On the other, it is a reflection of the possible emergence of short-term volatility in prices resulting from non-monetary shocks that cannot be controlled by monetary policy. Stability-oriented monetary policy strategy of the Eurosystem The monetary policy strategy of the Eurosystem is geared towards price stability within the euro area and can basically be described as a two-pillar strategy. The first pillar assigns a prominent role to money as defined by the broad monetary aggregate M3. There is wide consensus that medium-term inflation is actually a monetary phenomenon.