samchain/econo-pairs-v1 huggingface dataset:
And they can be further minimised if we can ensure that when the adjustment and loss occurs, other features of the financial system do not amplify and spread the stress. The great, post crisis, programme of reform of financial regulation, that is now well into its implementation had precisely this objective. Much stronger prudential rules require banks to have capital and liquidity to enable them to take losses and withstand liquidity stress in excess of the losses and stresses encountered in the financial crisis. 19  Bordalo, Gennaiolo and Shleifer (2018) 7  All speeches are available online at www.bankofengland.co.uk/speeches  7  Major UK banks now have capital ratios that are more than three times higher than before the financial crisis and their short-term wholesale funding has fallen from being more than 15% of total funding in 2007 to less than 5% today.

Speech  23 September 2022, 6.00 pm  Safeguarding the principles of regulatory policy Speech at the University of Lucerne  Thomas J. Jordan Chairman of the Governing Board * Swiss National Bank Lucerne, 23 September 2022 © Swiss National Bank (speech given in German)  *  The speaker would like to thank Christoph Hirter and Tanja Zehnder for their support in preparing this speech. He also thanks Claudia Aebersold, Petra Gerlach, Carlos Lenz, Alexander Perruchoud and the SNB Language Services. Page 1/5  Ladies and gentlemen Today’s event focuses on the question ‘Is monetary policy still regulatory policy today?’. I congratulate the University of Lucerne on choosing this important topic. Discussions surrounding regulatory policy have faded somewhat into the background of late. For the Swiss National Bank, however, the principles of regulatory policy – in particular those concerning monetary policy – remain of great significance. I am pleased to give you our view on this topic. In my remarks, I will therefore pay special attention to Switzerland and the SNB. First, I will look at why, for the SNB, the two regulatory principles of a clear focus on ensuring price stability and independence from politics are closely related. I will then show why these principles are contradicted by a number of recently launched political initiatives. To conclude, I would like to explain the SNB’s current monetary policy.
These issues – low growth and high risk – are the bread and butter of central banking. These costs are not the fault of any party, whether businesses or investors or other stakeholders. Rather they are the result of the incentives embodied within the current structure of companies. These frictions are not just multiple, but potentially interact in important ways. When framing policy choices, that means heeding the “theory of the second best”, in the sense of Lipsey and Lancaster (1956)): with multiple frictions, taking measures to address a friction in one place need not necessarily lead to an improvement in social welfare in aggregate. As one example of that in a corporate governance context, the shift to equity-based compensation practices in the 1980s and 1990s addressed one incentive friction – the principal/agent problem between shareholders and managers. But it may have done so at the expense of amplifying other incentives frictions – for example, it may have amplified riskshifting incentives from shareholders to creditors and to wider society. In some areas, there has been considerable progress in tackling some of these incentive frictions since the crisis, especially among banking firms. One prominent example is regulatory capital reform. Significant increases in banks’ equity and loss-absorbing capital have been put in place or are planned. This is likely to have reduced the incentives of shareholders to engage in risk-shifting, either to creditors or to wider society, thereby lowering the macro-economic costs of these activities.

Let me return to the Triffin Dilemma discussion mentioned earlier. As the issuer of an international currency can take advantage of its special status to overly stimulating domestic demand, this leads to excess liquidity in global market and can undermine the stability of the international monetary system in the end. However, whether the current vulnerability in the international financial system lies in the Triffin Dilemma or policy blunder is an on-going debate. Regardless of the nature of the vulnerabilities, it is clear that there have not been enough high quality financial assets in relation to financial investors’ demand. This is a factor that no doubt has contributed to the underpricing of risk and more importantly, a high degree of concentration in US financial assets, which have the most liquidity. This point is especially important because when the global economy resumes its normal path and when emerging market economies further accelerate their growth and development, it is without doubt that wealth will once again accumulate. This will result in greater global resources searching for investment in global financial markets. Therefore, I believe that there is a need to have more financial and capital markets that are deep and broad enough to have the acceptance of investors to help absorb the increased wealth and provide alternatives for quality investment globally. Looking around, some emerging market economies are certainly in a good position to further develop their financial markets in that direction. This is consistent with the concept of risk diversification.
Next February we are hosting a select meeting of econometricians in inflation targeting model-making, and we will see if after that we could make our model into a linear zone-quadratic model, which would be more consistent with a target band than the present model which is really better fitted to a point target. The link back between inflation targeting and forex stability is, however, more nebulous and we have therefore fortified it with technical changes in the trading system designed to keep exchange rates more stable again basically through transparency. In my statement two years ago, I said we had set up a money market committee to oversee our operations in the money markets as well as forex, including swaps, forwards, options, and such likes. This we have now developed into a very good domestic monitoring vehicle, and the control of offshore baht will be fortified next week with our reissuing of forex declaration forms, which reflect the reality of the market condition today. The old forex forms allowed us to know the purpose of forex transactions only of 40% of total transactions, since it was issued some 20 years ago, when 60% of today’s transactions were unknown or insignificant in the system. Although this in itself is not designed to limit or restrict forex flows, we believe the increased transparency will make the system less prone to speculation especially as we are one of the few central banks that have decided to keep supervisory powers within the central bank.

In particular, I think it will require ongoing collaboration between the private and public sectors to push the industry toward greater resilience to the financial risks of climate change. Discussions like this one are a critical step in that direction. Thank you for your attention. 1 Federal Reserve Board of Governors, Supervision and Regulation Report, November 2020. 2 Stiroh, Kevin J., The Basel Committee’s Initiatives on Climate-Related Financial Risks, October 14, 2020. 3 Basel Committee, Climate-Related Financial Risks: A Survey of Current Initiatives, April 30, 2020. 4 David J. Snowden and Mary E. Boone, “A Leader’s Framework for Decision Making," Harvard Business Review,  November 2007. 2/2  BIS central bankers' speeches
Like several overseas central banks, the HKMA is studying the technical feasibility and merit of Central Bank Issued Digital Currency (CBDC). It is still early days, but it seems CBDC offers greater potential in wholesale than the retail area in terms of payment and settlement, especially in the cross-border context. However, (f) considerably more research work is needed to analyse the relative merit of CBDC over the existing electronic or digital forms of payment in which central bank funds are used, cleared and settled centrally. It is also necessary to assess the likely impact CBDC has on the monetary policy transmission mechanism. We will share with the public the findings of our research work in due course. 8. Ladies and gentlemen, we are now in an exciting era in which FinTech, including DLT, is advancing in a speed that was unthinkable 10 years ago. All of us, industry practitioners and regulators alike, must try our best to keep up with the pace or else we risk being left behind. However, in embracing new technology and innovation, we must also guard against the risk of overlooking the nature of the financial transactions and the risks that are inherent in these transactions under the pretext of technological advancement. Crypto-assets are one such example in which the use of new technology does not alter the nature or risks of the products or the transactions. 9. I hope you will find my remarks today helpful as an elucidation of the HKMA’s stance on crypto-assets and on digital payments and settlement.

Writing in 2011, Ioannis Sarmas, my former colleague at the European Court of Auditors, presented three dimensions of the Greek governance problem: “[first] the lack of an internal control system allowing the government to pilot the country out of turbulence zone; [secondly] the absence of a culture of accountability requiring public fund managers to demonstrate the results achieved and finally … the inadequate powers for the auditing mechanisms preventing them from focusing on the waste of public money.”1 Governance reforms I will now move on to major reforms at the European level that are addressed to correct weaknesses in governance. On the fiscal side, governance has been enhanced by the strengthening of the Stability and Growth Pact. There appears to be broad consensus that to avert the recurrence of the crisis, fiscal consolidation should be enshrined in the governance structure of every country. Surveillance is enhanced and the monitoring of economic policies is becoming more comprehensive. To this end, the Fiscal Compact obliges all euro area countries to run a structurally balanced budget. In particular, the problem of sustainable budget planning is addressed by introducing a country-specific medium-term budgetary objective, which involves a cap on growth of public expenditure that is in line with the medium-term rate of  1  Ioannis Sarmas “The Greek financial crisis from an auditor’s point of view” Cour des comptes européenne Journal July–August 2011. BIS central bankers’ speeches  3  growth.
Paul Fisher: PRA Solvency II Conference – countdown to implementation Speech by Mr Paul Fisher, Executive Director for Insurance Supervision of the Bank of England and Deputy Head of the Prudential Regulation Authority (PRA), at the PRA Solvency II Conference, London, 17 October 2014. *  *  *  Good morning and thank you for coming today. First let me introduce myself. I have been both an academic and a long-term central banker – 24 years and counting at the Bank of England. I have worked across the Bank as a specialist economist/forecaster, private secretary to Eddie George, Head of Foreign Exchange and then Markets Director, I have served 5 years on the MPC, 2 years on the interim FPC and am now pledged to the PRA Board. Insurance is not an entirely new sector to me. For many years I have been speaking with the asset management arms of many insurance firms about your businesses, in Edinburgh as well as London. One of our strategic aims is to deliver supervision as One Bank and one of my personal objectives is to maximise the synergies of insurance supervision operating as part of the Bank of England. There is a lot to be gained by us and the industry if we can do that. But since taking over from Julian Adams as Executive Director for Insurance, one thing has been very, very clear. Right now, Solvency II is the main game in town.

In a world of low growth, the political rhetoric in some major economies has tended to focus more on the costs and less on the benefits. That is unfortunate, because given the current circumstances of the global economy, it is likely that we need deeper and fairer integration. For emerging economies in Asia and Latin America, the question for us is whether deeper economic and financial integration offers a feasible path towards unlocking sustainable growth of our economies? How do we mitigate the costs and maximise the benefits? The World Bank theme paper for this conference provides a useful starting point for thinking about these issues. I will leave it to the learned speakers today to ponder on that. I will just briefly share my perspective on this issue with respect to ASEAN and Malaysia. Asian regional economic and financial integration The ASEAN Economic Community Blueprint 2025 contains ASEAN’s vision of regional economic and financial integration over the next 10 years. When it came to formulating the 2025 Blueprint, the issue of the nature of integration has always been central. The fundamental challenge remains on how to use regional integration to leverage on ASEAN’s diversity in terms of economic size and structure, income levels, resource endowments and stage of financial sector development. Here, in the interest of time, l will just focus on ASEAN financial integration. I remember that soon after the Asian Financial Crisis, there was a lot of interest in looking at the European model of a single currency.
Since the discontinuation of the minimum exchange rate, the SNB’s monetary policy has been based on two pillars, which are designed to mitigate upward pressure on the Swiss franc and to ensure price stability over the medium term. The first pillar is the negative interest rate on sight deposits at the SNB. The second pillar is our willingness to intervene on the foreign exchange market as required. These two pillars are complementary and mutually reinforcing policy instruments. BIS central bankers’ speeches  1  The negative interest rate The negative interest rate applies to sight deposits above a certain threshold, held by banks and other financial market participants at the SNB. This threshold was introduced to limit the financial burden on banks. It was set at 20 times the minimum reserve requirements. By linking the threshold to the statutory minimum reserve requirement, the SNB adopted a measure that is both firmly anchored in law and for which clear rules exist. For depositors that are not subject to minimum reserve requirements, a fixed exemption threshold of at least CHF 10 million has been set. The thresholds imply that banks which hold large sight deposits relative to their minimum reserve requirements are affected most by the negative interest rate. Thus, like any other monetary policy measure, the negative interest rate affects different market participants differently.

These challenges lie less in the types of things that can be captured in a financial ratio or balance sheet, or in changes to the risk premiums attached to the financial claims on the country. They lie more in the realm of improving how markets work and how efficiently resources are allocated. These factors include the development of the types of institutions that are the subject of DeSoto's work or the reports. They involve the development of the legal system and World Bank's Doing Business its ability to ensure that property rights can be established and that the protections they engender can be enforced. They are about creating the conditions for more competitive domestic financial and product markets by reducing barriers to starting and building a business, and by building better transportation, power and telecommunications infrastructure. And they are about broadening access to and improving the quality of public education. Allowing competitive pressures to operate is undoubtedly the best way to foster the investment, innovation and risk-taking that is central to raising an economy's long-run sustainable growth rate. But markets can't solve all problems, and they don't always function perfectly. This means that the policy imperative isn't simply to reduce regulation; it is to improve the design of the regulations that are important to dealing with market failures. Finally, future growth outcomes will depend importantly on the success of governments in fostering the development of the domestic financial system.
Launch of new non-standard measures and their impact Faced with this critical situation, the Eurosystem adopted a two-pronged strategy. First, it offered ample liquidity at very long maturity to prevent funding issues from igniting a potentially destructive deleveraging process. Second, it widened the eligible collateral to facilitate access to the liquidity and the provision of credit to SMEs. Specifically, on 8 December 2011, the ECB announced the following initiatives. First, the ECB said it would launch two longer-term refinancing operations (LTROs) with a maturity of 36 months. The LTROs were to be conducted as fixed-rate tender procedures with full allotment, with the interest rate fixed at the average rate of the main refinancing operations over the life of the respective operation. To increase the flexibility of the operations and to cater for different liquidity needs, counterparties were offered the option to repay after one year any part of the allotted amounts. Second, the ECB decided to increase collateral availability by allowing national central banks, among other things, to accept as collateral additional performing credit claims (i.e. bank loans) that satisfy specific eligibility criteria. As an example, the Banque de France has accepted real estate residential loans with a mortgage or first-rank privilege, credit claims denominated in US dollars and export credit claims guaranteed by Coface.

His works have over the years touched on many aspects of money management as seen from the context of ordinary Malaysians, leaving us with memorable and lasting impressions not only on prudent financial behaviour, but on Malaysian life and society. Important lessons about savings, conserving and avoiding wastage are powerfully conveyed through the remarkably creative and entertaining visuals that we have all come to know and love. True to form, Datuk Lat’s creations are unparalleled in their ability to capture the hearts of Malaysians and through them, we are both educated and entertained. It is our honour to commemorate his works for such an important cause. Since 1999, 15 million copies of Buku Wang Saku have been circulated to more than 10,000 schools nationwide to be used in promoting good financial management habits which can make a profound difference in their future financial well-being. Indeed, being equipped with the knowledge, skills and tools to make sound financial decisions has never been more important in a generation where our young people have more money to spend, are presented with a wider spectrum of financial offerings and are exposed to greater temptations to take on debt. Financial education is therefore a vital life skill; one that must be developed from an early age. It was with this motivation that the Bank initiated a number of efforts to enhance the financial competence of Malaysians through a nationwide savings campaign that was launched in 1996.
I also want to thank Andy Haldane, our communications staff at the Bank, and our colleagues tasked with making the logistics work – all the way to Edinburgh. Last but certainly not least, let me thank those of you who spent the day with us at Guildhall, those who followed online, and those who participated in our sessions in Birmingham and Edinburgh, Cambridge and Manchester and our many school sessions. Apart from coming up with the words “Open Forum”, I’ve added little to this memorable day, but I have taken away a great deal! Let me spend a couple of minutes on a few of these takeaways. They are far from comprehensive, and only a starter, because part of the point is that we all need to go back and reflect on what we learned and what we’d like to prioritise. The first thing that struck me was the almost universal reaffirmation of the importance of markets. Whether it was the vox-pops in the streets of Leeds or Belfast, the feedback from our event in Birmingham, the interventions here in Guildhall, there was a clear recognition of how important these markets are not just to the economy, and not just in an abstract sense, but to people’s everyday lives. At the same time, the level of trust in institutions and market mechanisms is quite low.

Mark Carney: Closing remarks to the Open Forum Closing remarks by Mr Mark Carney, Governor of the Bank of England and Chairman of the Financial Stability Board, to the Bank of England Open Forum, London, 11 November 2015. *  *  *  Let me begin by thanking the Lord Mayor and his team for their gracious hospitality once again. The Guildhall really is a fantastic venue, and I want to take this opportunity, as we approach the end of your term as Lord Mayor, to salute you for the emphasis that you have put on the broader role of finance in society, the broader role of the City of London in the UK economy and in the global economy, and your broader contributions to society. City Giving Day is but one example of that, and we are all very much in your debt for your enormous contribution. On behalf of my colleagues, I want to thank the Chancellor of the Exchequer and the President of the European Central Bank for their insightful comments. Let me also thank all of the panellists for their well-chosen, provocative, and effective contributions. I am also grateful to the moderators here today, in person or online from across the country, for helping drive our Open Forum. Most of all, let me thank our steering committee, those 20 people from all walks of life, who put a tremendous amount of time and thought into the sessions.