samchain/econo-pairs-v1 huggingface dataset:
The second layer of the iceberg – dissipating bank solvency – became overwhelmingly apparent in September 2008 when Lehman Brothers collapsed. This seminal event unleashed a sudden re-pricing of risks, leading to a severe financial crisis. The consequence was a sharp downturn in private investments and consumer demand, and the result of that was a sizeable fall in economic activity. BIS central bankers’ speeches  1  The third layer of the iceberg – the sovereign debt crisis – emerged in the beginning of 2010, when the true scale of the dis-connection between some countries’ official debt and their capacity to generate income to service the debt became clear to everyone. In all fairness, I remind you that central banks in general and the ECB in particular had pointed to this risk long before the sovereign debt crisis erupted. The re-pricing of risks escalated, it spread from banks to the sovereigns and back to the banks, reflecting an adverse feedback-loop between banks and their respective home country. The feedback-loop was composed of three elements to varying degrees in the affected countries: (i) some banks’ solvency was under pressure due to their high exposure to their home country’s sovereign debt.

In order to allow banks to mobilise a larger share of assets for refinancing purposes, the Eurosystem expanded the set of assets that could serve as collateral for central bank credit. Belonging to the same family of tools are the two 3-year Longer Term Refinancing Operations that were announced a little more than a year ago, also to address a funding crunch in solvent banks. As a further step to address the banks’ funding problems and the deep financial fragmentation within the euro area, the instrument of intervening in securities markets was launched. This tool has been available to the ECB since the inception of the third stage of Economic and Monetary Union in 1999, but it was not until 2009 that it was actually used. The first action of this type was the purchase programme for bank-issued covered bonds. In May 2010 the Securities Markets Programme (SMP) took effect, in conditions in which the collapse in the markets for securities issued by distressed governments threatened a renewed wave of chain defaults. The SMP programme was finally superseded by the so-called Outright Monetary Transactions (OMT), announced in September 2012 but so far not activated. I will talk more about the OMT later. The standard measures have definitely served their purpose, to maintain price stability. And it is undisputable that the non-standard measures have helped repair the monetary policy transmission mechanism by alleviating funding pressures in banks and thus complementing standard measures.
Second, inflation expectations may be used by policy makers to gain information about the setting of short-term interest rates, whereas changes in the nominal yield curve, on their own are of no use. An increase in long-term nominal interest rates may be driven by a rise in the long-term expected inflation rate or a rise in the inflation risk premium, but it may also reflect an increase in long-term real interest rates, driven by some real factors. The two first movements could justify a change in the monetary policy stance, once the nature of the underlying shock and its likely duration have been clearly identified, but such a change may be inappropriate in the last case. Third, information on long-term inflation expectations can provide monetary authorities with a measure of the credibility of their commitment to price stability. The existence of a market for inflation-indexed securities may provide central banks with very useful information, since it may then enable them to identify whether changes in nominal yields mainly reflect changes in the expected long-term inflation rate or rather whether they are due to changes in real yields.

Lars Nyberg: Swedish housing financing and the EMU  Speech by Mr Lars Nyberg, Deputy Governor of the Sveriges Riskbank, at Economics Day held at HSB Bank, Stockholm, on 8 November 2000. *  *  *  I would like to start by thanking you for inviting me to HSB Bank’s Economics Day and giving me this opportunity to talk about Swedish housing financing from an EU perspective. Introduction One of the main purposes of the Single Market and the introduction of EMU is to create a more efficient market for goods and services, a market which is characterised by greater competition and better products at lower prices. On the mortgage market, this should mean that borrowers can expect a wider range of products, more choice of suppliers and lower interest rates. The national mortgage markets in Europe vary considerably, as does their significance to the country’s economy. This is illustrated in the following diagram (Figure 1). In countries such as Germany, Denmark, Sweden, the Netherlands and the UK, the total outstanding stock of loans with property as collateral amounts to over 50% of GDP. In other countries, such as Greece and Italy, the corresponding figure is less than 10%. The differences are mainly due to factors such as different regulations, tax legislation and market structures in the different countries. As in Sweden, housing financing issues have often aroused considerable political interest, a fact which is reflected in all of the above factors. The outstanding stock of European mortgage bonds divided by GDP 1998.
That project, however, had little in common with today’s world wide web. It had no pictures, links or e-mail. It was also cumbersome. E-mail was in fact introduced three years later but it was not until the turn of the 1980s that we got the world wide web, which is what we now think of when we talk about the Internet. That was what made it possible to click on a word and move quickly from page to page on the net. At much the same time it also became possible to dispense with complicated manuals and commands in favour of simple graphics and clicking with a mouse. Introduction underestimated All forecasts to date about the spread of the Internet have been on the low side. In the United States it was 38 years before 50 million households had radio sets, while the intervals for television sets and cable television were 13 and 10 years. The Internet, however, had reached 50 million households after only 5 years and according to some estimates the number of users next year will be up around 160 million. But, as I said, the outcome has been consistently underestimated. It has been said that whereas conventional telephony in Sweden is growing by 7% a year, traffic on the Internet is currently rising at this rate every week. It is not just that more and more people are subscribing; those who surf on the Internet are doing so more and more.

It is rather a matter of a new challenge in the long series of challenges the Swedish economy has had to face ever since the dawn of the industrial era more than a century ago. 5  BIS Review 118/1999
In the baseline specification in Galí (2008), the slope is:  12  All speeches are available online at www.bankofengland.co.uk/speeches  12  𝜅=  (1 − 𝜃)(1 − 𝛽𝜃) 1 − 𝛼 𝜑+𝛼 (𝜎 + ) 𝜃 1 − 𝛼 + 𝛼𝜖 1−𝛼  (6)  𝜃 is the degree of price stickiness, 𝛽 is the discount factor in household preferences, 𝛼 is the degree of decreasing returns to labour in production, 𝜑 is the inverse of the elasticity of labour supply with respect to real wages (holding marginal utility of consumption constant), and 𝜎 is the inverse of the elasticity of intertemporal substitution in consumption. Significantly, the elasticity of demand, 𝜖, and hence the mark-up, 𝜇, affect the slope of the Phillips curve. The higher the degree of market power and higher the mark-ups firms charge, the steeper the slope of the Phillips curve (or, equivalently, the smaller the sacrifice ratio). We can roughly gauge the scale of this effect by calibrating the model. Chart 16 looks at the relationship between the slope of the Phillips curve, 𝜅 and mark-ups, 𝜇, for a given parameterisation of the model. The relationship is, as we expect, a positive one. As a thought experiment, consider the scale of increase in mark-ups seen by the average firm globally since 1980, from around 1.1 to around 1.6. 23  Other things equal,  this would be expected on this calibration to have steepened the slope of the Phillips curve from just under 0.1 to around 0.2.

36  All speeches are available online at www.bankofengland.co.uk/speeches  36  Chart 16: Mark-ups and the slope of the Phillips curve Slope of Phillips curve  0.3  0.2  0.1 Estimated increase in global mark-ups 0.0 1.0  1.2  1.4  1.6  1.8  2.0  Mark-up level Sources: De Loecker and Eeckhout (2018), Galí (2008) model and Bank calculations. Notes: Parametrisation such that 𝛽 = 0.99, 𝜃 = 2/3, 𝛼 = 1/3, 𝜑 = 𝜎 =1. Chart 17: Global mark-ups and real interest rates Mark up  Per cent 3.5  1  3 1.2  2.5 2  1.4 1.5 1  1.6  0.5 0  1.8 1980  1984  1988  1992  1996  2000  2004  2008  2012  2016  Laubach & Williams estimate of US natural rate of interest (LHS) Global mark-up (inverted, RHS) Sources: Updated estimates from Laubach and Williams (2003) (available online), De Loecker and Eeckhout (2018) and Bank calculations. Notes: Estimate of US natural rate of interest shown here uses annual averages of quarterly Laubach and Williams estimates. We would like to thank Jan De Loecker and Jan Eeckhout for kindly sharing their series of global mark-ups.
Up to now we have only seen isolated capital outflows but we need to keep an eye on that. In the 1/4  BIS central bankers' speeches  event of large outflows from investment funds, the main concern would be to prevent an excessive fall in prices caused by fire sales – that is, distressed sales of assets at large price discounts. On Sunday, the world’s central banks decided on extensive coordinated measures. The ECB announced a first major package on Thursday. What is the point of all that if the financial crisis has not yet set in? The situation in financial markets is already very tense. Last Thursday, we decided to provide abundant and very cheap liquidity to the banking system. That is the primary task of central banks at present. On Sunday, in a coordinated effort with other major international central banks, we took measures to provide banks with cheap US dollar liquidity. We did so because banks in some countries, especially Japan, had been finding it harder to access US dollars. The US Federal Reserve slashed interest rates. The ECB stepped up its asset purchases. But none of this seems to have had the desired effect. Equity prices continued to fall. What is going wrong? The ECB’s package was very comprehensive. But market volatility is partly masking the effects. Moreover, not all market participants seem to have immediately understood all of the components of the programme.

All in all, if, as we are often emphasizing during this crisis, the post-crisis reforms have mitigated the risks to the sector’s financial stability, the implementation of the resolution framework has contributed to strengthening the banking sector in a crucial manner. Identifying gaps for a more robust resolution framework in the EU Accepting that we have made great advances in this field, we have to acknowledge also that there is still some way to go before we can truly assert our journey is over. First of all, it is important to recall that the European resolution framework is one of the three pillars of the Banking Union and it is essential to develop the third one – the much needed European Deposit Insurance framework – to ensure the resilience and well-functioning of this Banking Union. As this matter goes beyond the scope of this conference, I will rather concentrate on the second pillar of the Banking Union. So, entering into this resolution pillar, there are certain areas on which both policymakers and practitioners should concentrate, and it is precisely some of these gaps that I want to discuss today, namely: -  liquidity in resolution, the resolution approach to small and mid-sized institutions, avoidance of unlevelled playing fields, and the adequate treatment of systemic situations. The first issue to be addressed, as it affects all institutions alike, is the provision of liquidity to a bank in resolution.
32 Đ Đ I wish you a fruitful general assembly and annual meeting in Singapore. Thank you. [1] The IMF’s 2019 global growth forecast was lowered to 3.2%, as cited in the World Economic Outlook, July 2019. [2] IMF World Economic Outlook, July 2019 [3] The world’s best performing developing economies are defined as those that have averaged at least 3.5% annual per capita GDP growth over 50 years or 5% annual growth  over 20 years, as cited in the McKinsey Global Institute Study on Outperformers Maintaining ASEAN Countries’ Exceptional Growth Report in 2018. [4] Population projections from the UN. The relative market size of ASEAN is cited by the US-ASEAN Business Council in its growth projections for ASEAN in 2050. [5] DBS Bank and the UN Environment, Green Finance Opportunities in ASEAN 2017 [6] ASEAN Green / Social / Sustainability Bonds / Sukuk for October 2019 [7] GCIO Sustainability Reporting in ASEAN Research Report 2018 [8] Nasdaq and Celent July 2018, Global C-Suite Study on Capital Markets Infrastructure Technology [9] Global private equity valuations has grown more than 700% since 2002 in 2017, outpacing public equity market valuations, McKinsey Global Private Markets Review 2019, Private markets come of age. [10] CFA Institute Nov 2018, Capital Formation: The Evolving Role of Public and Private Markets [11] Wall Street Journal Jan 2018, Fewer Listed Companies: Is That Good or Bad for Stock Markets?

Several entities have been charged in court and some of these had been convicted. While we will sustain these efforts to continue to raise standards of compliance in the industry, the primary responsibility for ensuring compliance rests with the industry itself. It starts with every company having clear processes, well-trained and informed staff, and effective systems and records that assist in complying with regulatory requirements. The industry has made some progress, and we are encouraged by the efforts that are being made at individual companies and at the industry level. Some of you have made more progress than others. For those that continue to wait, time is running out and it is very important that plans be developed immediately and implemented aggressively to establish the necessary systems to improve compliance with the law. Overall, while the industry has done a commendable job, a lot more can be accomplished and it is in the industry’s interest to show improvements, as we enter into the next round of compliance assessment of individual companies. Expectations on MAMSB We have high hopes and expectations for the association. The establishment of this association is very timely for it to play a central role for the benefit of the industry. The Association should spearhead and drive capacity building efforts that will support the objectives of promoting modernisation and elevating the standards of compliance and professionalism in the industry. Firstly, the association is expected to take on an important role in instilling professional conduct and good business practices amongst the industry players.
The aim of the scheme is to defray the frictional costs of catastrophe bonds issuances. We have received keen interest from the region, with a healthy pipeline of issuers keen to tap on the grant scheme to issue a catastrophe bond here. Leading insurance brokers have expressed support for Singapore as a domicile and are working with their Asian clients for potential issuances here. b. We have also formed an industry-led Alternative Risk Transfer work-group to advise MAS on initiatives to support the development of Singapore as an ILS domicile. The workgroup will continue to provide feedback on the current ILS regime including on 3/4  BIS central bankers' speeches  regulations, tax and structures. 15 Fourth, our proximity to Asian markets allows for a deep understanding of underlying risks and needs of the sponsors. We have grown as a traditional re/insurance market due to this and it will likewise be an important consideration for Asian ILS issuers looking to tap capital markets in the region, and for capital providers that are underwriting the risks. 16 Despite this promising outlook, we recognise that ILS expertise is still nascent in Asia, and there is much scope for Singapore to learn from international best practices. We hope to strengthen Singapore’s proposition as a ILS domicile in 4 ways: a. First, we seek to explore the introduction of bespoke corporate structures for the ILS market, like the Protected Cell Company (PCC) structure, to provide more structuring options to potential issuers.

The protection gap in Asia is set to widen for the following three reasons: a. First, the frequency and severity of natural catastrophes is increasing. According to UN data, the number of natural disasters in the Asia-Pacific has increased from an annual average of 44 disasters in the 1970s to 146 in the 2000s. b. Second, the wealth and value of assets at risk have also increased. Strong economic growth in Asia and growing urbanisation has led to the rise of small highly-populated megacities, many of which lie along areas that are exposed to natural perils. c. Third, insurance penetration is still low in Asia. Just over 8% 3 of natural catastrophe losses are insured in Asia as compared to 40% in developed regions. 9 ILS, together with other risk management solutions including reinsurance and government pools, have significant scope to play a larger role in reducing the financial impact of natural disasters. Globally, UK, Spain and France have already established natural catastrophe schemes that tap on a combination of traditional and alternative capital. 10 There are positive signs of change, with ASEAN making a push to address its rising exposures to natural catastrophe. Let me provide some examples of recent developments: a. ASEAN has commenced a holistic approach to disaster risk management through the ASEAN Disaster Risk Financing and Insurance (ADRFI) Programme. The Programme will strengthen ASEAN’s disaster risk management capabilities through: i. Improving data required for assessing disaster risk exposure and financing solutions. ii. Enhancing knowledge on disaster financing solutions through capacity building. iii.
Over time, cyclical fluctuations in unemployment have been small in relation to the increase in structural and frictional unemployment and growth in the number of disability pensioners and persons on early retirement. It is important to preserve and perhaps improve our flexible system of wage formation. Pension schemes and the application of social security rules should also be changed to provide better incentives and opportunities to seek employment. Legislation and rules governing the labour market can also be better designed to promote production and employment. 5  Source:Kjell Gunnar Salvanes: “Omstilling og strukturelle endringer i det norske arbeidsmarkedet” (Adaptation and structural changes in the Norwegian labour market). Lecture at a conference arranged by the Norwegian School of Economics and Business Administration, the Norwegian Shipowners’ Association and the Foundation for Research in Economics and Business Administration in Oslo on 8 October 2004. 8  BIS Review 10/2005  Conclusion Before I conclude, let us return to the period surrounding the dissolution of the union with Sweden in 1905. As mentioned, the dissolution did not have any implications for monetary policy in Norway. However, a Swedish economist of that period is in some ways present in today’s monetary policy – in both Norway and Sweden. Knut Wicksell was professor of economics at the University of Lund. When the Scandinavian currency union lost its significance in 1914, he proposed the establishment of a Scandinavian central bank. Its objective would be price stability. Once inflation targeting became the framework for monetary policy in many countries, Wicksell’s works experienced a renaissance.

We observe a downward trend of productivity growth – which is considered by some as “secular”, jumping perhaps too hastily to a very long-term conclusion. Furthermore, the ageing of the population means the labour supply is shrinking and potential growth is falling. Thanks to Japan’s G20 Presidency, the challenges posed by demographics are now on the agenda. The ECB’s monetary policy has played an important role in supporting the recovery of the euro area: estimates put the cumulated impact on growth at around 2.5 pp and on inflation at between 1 and 1.5 pp for the period 2014–181. In addition, 11 million jobs have been created since 2013. In September, the ECB introduced a further package of measures. Although it has received less attention, the most innovative part of this package is the strengthening of the state-dependent forward guidance on interest rates. Conditional on inflation developments, this will act as an automatic stabilizer through adjustments in the yield curve and financial conditions. In other words: what does matter is not only the level of our key short term interest rates, which are currently anticipated by markets, reasonably in my view, as close to bottoming out ; it is also and foremost the time horizon of our policy measures Clearly, monetary policy will be all the more effective if it will no longer be the only game in town. You may not realise it, but the euro area has more policy room than others in non-monetary domains, but under-uses it.