samchain/econo-pairs-v1 huggingface dataset:
I believe that the patient can of course be cured, must continue to take the prescribed medicine and should not be out on the town at night. Many thanks, again, to the Academy and the President for your invitation and to all of you for your attention. BIS central bankers’ speeches  5

Ajith Nivard Cabraal: Protecting financial systems from money laundering and terrorist financing activities Keynote address by Mr Ajith Nivard Cabraal, Governor of the Central Bank of Sri Lanka, at the World Bank Workshop on Capacity Enhancement for Anti Money Laundering and Combating the Financing of Terrorism, Colombo, 7-11 May 2007. *  *  *  Ladies & Gentlemen, Let me welcome you to the inaugural ceremony of this Capacity Enhancement workshop and extend to all overseas participants and representatives a very warm welcome to our country. I am also happy to be able today to share a few thoughts with you about the need to ensure the integrity of worldwide financial systems by protecting such systems from money laundering and terrorist financing activities. This is a challenging task as advancements in technology, especially in the financial services industry, have made it easier for criminals including terrorists to take advantage of liberalized financial markets, innovative technologies and the ease with which cross-border flows of financial transactions can take place. One of the most recent incidents in this regard is the sophistication with which, internationally active Tamil Tiger Terrorists have successfully perpetrated a massive credit card fraud in London costing the British public, according to reports, about 100 million Sterling Pounds by skimming credit cards belonging to the British public. Skimming has been a common technique used to raise funds for terrorists in Algeria, Kashmir and Chechnya, and now it is clear that it is being extensively practiced in the Western world too.
They have all done high quality research and have secured good placements, two of them at the Banco de España. I am sure that we will see many papers from their theses appearing in academic journals. The 20 students who graduate today from the Master in Economics and Finance come from seven different countries: Argentina, Australia, Colombia, Chile, China, Costa Rica, Italy, and Spain. They will join more than 700 alumni of CEMFI's Master programme. Most of the students of this year's class will continue their graduate studies towards a PhD, five of them at CEMFI, while the rest have found or are about to find jobs in accordance with their high qualifications. It is for me a great privilege and honour to be given the opportunity to present the certificates of the Master Degree in Economics and Finance to the students in the graduating class. I am also pleased to announce the winner of the "Luis Ángel Rojo Prize" for the best student of the class of 2023 of the Master in Economics and Finance. The winner is: Kenneth Lai. Congratulations to Kenneth and to all the students in the graduating class. Finally, I would like to conclude my remarks by once again thanking Manuel Arellano, Samuel Bentolila, and Rafael Repullo for their commitment to CEMFI over more than 30 years.

21 Second, MAS is studying whether existing incentives for funds and fund managers, which have been successful in attracting traditional asset managers to set up in Singapore and to grow over time, are suitable to anchor VC funds and VC fund managers here too. We recognise that VC funds and fund managers are typically smaller in size and headcount than traditional asset managers. But they contribute in a different way, by supporting entrepreneurship and innovation in Singapore and the region. We will take this into account in assessing the requirements for VC funds and fund managers to qualify for our incentives. Conclusion 22 Innovation will drive Singapore’s economic future. It will disrupt existing business models, but it is how consumers get better value, how new firms can scale up and grow internationally, and how we create quality jobs for our people. 23 This innovation village is part of this ongoing journey. It will, I am sure, nurture a new generation of technology entrepreneurs in the FinTech space. I congratulate Marvelstone once again for the successful launch of LATTICE80. 3/3  BIS central bankers' speeches
In other words, the monetary tightening policy conducted by the CBT contributed to the decline in medium and long-term interest rates by diminishing the inflation risk premium. At this point, I would like to underline an operational aspect of monetary policy relating to policy rates. In the first half of 2008, excess liquidity sterilized in the overnight market shrank due to the cut in the volume of daily FX-buying auction as well as the Treasury’s less FX borrowing and the rise in money demand. These developments led to occasional liquidity shortages. By May 2008, liquidity shortage has started to emerge more often for longer periods. During this period, the Central Bank provided the required liquidity into the system via one-week repo auctions, targeting overnight interest rates to materialize at levels close to Central Bank borrowing rate. Still, there has been some undesired volatility in the overnight rates due to unforeseen movements in the liquidity, mainly arising from the banks’ demand for reserves. Considering these developments, the Monetary Policy Committee has decided to reduce the margin between the borrowing and the lending rates by 50 basis points in July. Current projections do not point to a permanent shortage in the liquidity in the upcoming term. In case of temporary shortage, the Central Bank will provide the required liquidity through one-week repo auctions, targeting the overnight interest rate in the money market to stay close to the Central Bank borrowing rate. Hence, the key policy rate will continue to be Central Bank’s overnight borrowing rate.

I see no appetite to tear those up and start again from a blank sheet of paper, given the huge investment we have all made in their adoption. And broadly Solvency II has served the UK well – as evidenced by the resilience of your firms through the pandemic to date. But the regime is in my view somewhat over-specified, and it also does need tailoring in places – particularly on the Life side. It is common ground between us that the risk margin is not correctly calibrated, resulting in levels of offshore reinsurance of longevity risk in the provision of UK retirement income that will become increasingly uncomfortable over time if we take no action. The risk margin will come down from current levels, and become less volatile. But for us risk margin reform in isolation is not synonymous with discontent about the overall levels of capital in the system. We have not seen persuasive evidence that this is either too low or too high: I discussed the health of returns on equity briefly earlier; nor do I see evidence of current capital requirements meaning that demand for insurance goes unmet. Some big numbers are being bandied about in lobbying for an overall weakening of prudential standards. I have to say that I think these numbers – being based on multi-decade forecasts – are a little speculative.
Also in most ten-year periods, investing in US equities has been profitable, with the exception of the depression in the 1930s and the last half of the 1970s. Equity returns have been negative after ten years only in the years between 1928 and 1938, in other words on equity investments made the year before the 1929 stock market crash. It may also be worth noting that equities purchased during recessions - such as in the mid-1930s and mid-1970s - brought solid returns ten years later. The picture is the same for most other countries. Since short-term fluctuations in equity prices are difficult to predict, it may be a sound strategy to keep the share of equities constant over time. This means buying a relatively large volume of equities when prices are low, and buying a smaller volume - or selling - when prices are high. This is the strategy applied by the Petroleum Fund. Let us now revert to the Norwegian economy and Norwegian economic policy. The revision of economic policy in March 2001 can to some extent be said to be a consequence of our oil economy. The new guidelines have also changed the interaction between the different components of economic policy. Fiscal policy will now have an expansionary effect. In order to prevent pressure from becoming too strong, monetary policy has to be tighter than would otherwise have been the case. Monetary policy has therefore been given a clearer role in stabilising economic developments.

This is welcome for financial stability, especially for mortgages. But as a result, the pass-through of higher policy rates is more gradual. 1/3  BIS - Central bankers' speeches  The origin and sectorial composition of inflation matters. The current surge in inflation does not primarily originate in overheated demand but in supply shocks. This has implication for the transmission lags. (i) The rise in the price of commodities and input costs was at the root of inflation. Their pass-through to producer prices and subsequently to CPI inflation might be asymmetric, faster and more complete on the way up than on the way down. It implies that the current decline in energy and input costs may not fully translate yet into lower inflation. (ii) Services inflation, in part fuelled by wage developments, has gradually but steadily surged over recent quarters, and is likely to become the dominant source of inflation in the euro area. Historically, services are the most persistent and important component of both headline and core inflation, and their share in consumption increased significantly in the last decades. They are less directly sensitive to interest rates; the dampening effect of monetary policy on aggregate demand will be felt, but it will take more time. What conclusions can be drawn for monetary policy ? a. In the usual alleged time lag of one to two years for monetary transmission, our economic situation is presently closer to the upper range.
The euro area faces risks to its economic growth on such a scale that it’s necessary to use all available tools to support the economy. And that means using the instruments on the demand side and the supply side. On the demand side, you have monetary policy. And what the ECB has announced shows that we are committed to taking steps and that we have instruments we are ready to use. You have also fiscal policy, in those countries that have space to expand it. But what matters  BIS central bankers’ speeches  1  most are the structural reforms, because without them no supply or demand measure will have an effect. Q: Is that message aimed at France and Italy? A: We are not asking anything from anyone in particular. There is nothing of a give and take here. The ECB is independent and does not enter into this kind of bargaining. We do what we think we have to do and we expect others to do their job. We are just highlighting the conditions for it to be effective. For example, in our view, the countries that want flexibility in applying the Stability Pact should announce reforms beforehand, because flexibility is useless if it isn’t backed by reforms. Fiscal policy should be used to support aggregate demand – but within the framework of the Stability Pact, and that’s an important “but”. The Pact creates confidence.

And we want to do this in a way that is meaningful for the economy. That is why it is not a quantitative increase in liquidity (quantitative easing or QE), but is targeted and aimed at facilitating the flow of credit. In a way, I would describe it as a qualitative increase rather than as a quantitative one. However, we should not get into a debate over terminology. At the ECB, we do not believe in magic words, QE or otherwise. What we want to do is to devise a monetary policy that is effective in the current economic situation and that fits Europe’s economic framework. Thus, inevitably, the ECB’s monetary expansion is unlike that conducted in the United States or the United Kingdom. We are at a different juncture and our economy is structured differently. In fact, we cannot draw too many lessons from what other central banks have done, because our situation is so different. Q: Has an actual target been set for the expansion of the ECB’s balance sheet? A: No, we have not set a particular target, because we will do whatever is useful to facilitate the flow of credit to the economy. We have announced a programme to purchase assetbacked securities and covered bonds. Depending on its impact on growth and inflation, this programme can be expanded. The Governing Council will monitor developments, discuss them, and take decisions as appropriate. Q: You have been accused by some of instigating a bubble, particularly of public debt.
The calculations indicated that industrial production and investment would increase, public finances would improve, the current account deficit would disappear, employment would increase and unemployment would be kept down. After Kjell-Olof Feldt had made contact with the Nordic finance ministers and central bank governors, as well as the German central bank governor, the size of the devaluation was altered to 16 per cent and the planned pegging of the krona to the German D-mark was postponed indefinitely. I had reason to return to these calculations later on during the 1980s and I could observe that they were pretty accurate on most points, except with regard to price and wage developments. I had assumed that inflation and wage increases would adjust downwards to the international level. For devaluation to be successful, price and wage developments must be kept down after the devaluation. However, this was not the case. Sweden had an inflation rate much higher than that in Germany every year of the 1980s. Economic policy was not sufficiently strict during the 1980s to keep down price and wage increases after the devaluations in 1981 and 1982. Although public sector finances improved substantially, this was primarily due to automatic improvements resulting from a number of years of good growth.

On that view, and given the recent moderate decline in sterling's effective exchange rate, it is reasonable to look forward to a gradual improvement - and I emphasise gradual improvement - in the external environment which would clearly be very helpful from a UK perspective. I don't deny that there are downside risks to this scenario. The Eurozone has for example recently put back its projected expansion until later this year. And financial markets, and both business and consumer sentiment, have recently been severely affected by uncertainty over Iraq - though financial markets, certainly, now that the war has started, have factored in its rapid conclusion. I hope they prove to be right - for more than purely economic reasons. Notwithstanding these risks, I still think that the most likely outcome is that we will see a gradual pickup in the pace of global recovery over the next year or two - which is the view shared by the Monetary Policy Committee in our February Inflation Report and by most other economic commentators. On that basis we would also expect to see a gradual recovery in domestic business investment as we go through this year and into next. And, while fiscal prudence is clearly important for the stability and efficiency of the economy over the medium term, the Chancellor's projected increase in public spending is in my view positively welcome in the immediate situation confronting us.
But before being discouraged by that, let’s reflect for a moment on what we already have achieved to date and some of the reasons why success is fully within our grasp. U.S. households have already undertaken considerable deleveraging. The U.S. financial system has made material progress toward better health. House prices are back at levels consistent with long-term affordability ratios. Banks have much more capital than they had on the eve of the financial crisis, the quality of that capital is much better and liquidity buffers are now much deeper. Credit availability is slowly improving. Though our challenges are large, we have come a good way already. And the policy challenges we face are not insurmountable. Even the long-term fiscal issues are not as intractable as some maintain; Social Security can be put on a sustainable trajectory with relatively moderate changes, and while Medicare and Medicaid are more complex, successful reform must be possible given that other industrialized economies spend a lot less on healthcare, often with better results across the population. Even with determined effort the road ahead will not be easy, and it will be several years before our economy once again operates at something close to its true potential and all who seek work have a good chance of finding employment. 8  BIS central bankers’ speeches  However, provided we secure the recovery, there is every reason to expect our nation will return in time to prosperity and solid growth.

Employment dropped sharply during the recession, contributing to a sharp rise in the unemployment rate from around 4.5 percent in the middle of 2007 to over 10 percent in October 2009. Extraordinary actions by authorities around the world, including the Federal Reserve, prevented full-scale financial and economic collapse, and the global economy stabilized around mid-2009. But since then, the recovery has been bifurcated. While emerging economies have rebounded rapidly, the developed world has grown only slowly. This has hastened a historic shift in the balance of economic power that was already underway before the crisis. In the United States, the recovery has proven to be persistently weaker than expected. Growth has been insufficient to either bring down unemployment significantly or to achieve a self-reinforcing cycle of strengthening confidence, demand, income and employment. Although the latest news on the U.S. economy is somewhat more encouraging than that from earlier in the year, we should not take much solace from that. After a very weak first half, when growth was less than one percent, economic activity has strengthened somewhat and inflation pressures are starting to ease. Growth in the third quarter is currently estimated 2.5 percent, and recent indicators suggest growth in the fourth quarter could be somewhat higher. However as we look toward 2012 the U.S. economy continues to face several obstacles to a robust economy. Accordingly, I expect growth of about 2.75 percent for 2012, not much higher. We also continue to face significant downside risks, mostly related to the stress in the eurozone.
In the latter area we actually have made major innovations since our Monetary Policy Meeting last Thursday. We now upload to our public website the background information based on publicly available data before holding the meetings where we decide on monetary policy. Today’s scenario: uncertainty and risks Monetary policy is one of many factors influencing the cost of borrowing faced by households and firms. Another factor that has gained significant importance is the perception of risk and volatility that has swept over every financial market. This increased with the worsening of the global financial crisis last September. In general, and despite efforts made by economic policy makers in the main economies around the world, we are still dwelling in an extremely uncertain scenario. This has a number of implications that ultimately affect the conditions and costs of credit to firms and households not only in Chile but everywhere. To begin with, external lending standards for domestic banks have become more stringent. We see it in that, although our banks have been able to access foreign credit sources, these have been at shorter maturities and with larger spreads over external reference interest rates. This is a reflection of the difficulties that continue to haunt the main global financial institutions and their reluctance to embark in new businesses.

Just as we did a year ago, when we discussed the exchange rate conjuncture at the Honorable Chamber of Representatives, I want to state that we act with the conviction that we are making the best decisions to provide stability to our economy and widen its growth opportunities. We permanently and carefully monitor the situation and we incorporate it consistently in our monetary policy decisions. To finish, I thank again the Economic, Promotion and Development Commission of the Honorable Chamber of Representatives and its President, representative Mr. Antonio Leal for letting me present our visions here. The serious management of monetary policy and its formulation on a solid technical basis is essential to ensure economic stability in such volatile  4  4  Matus et al. (2009). BIS Review 35/2009  and blurred global conditions as we are now going through. I appreciate this opportunity to come and expose our vision of the relationship between market interest rates and the conduct of our monetary policy. Thank you. References Becerra, S., L. Ceballos, F. Córdova, and M. Pedersen (2009), “Evolución Reciente de las Tasas de Interés de Colocación,” manuscript, Research Division, Central Bank of Chile, March. Berstein, S. and R. Fuentes (2003), “De la Tasa de Política a la Tasa de Colocación Bancaria: La Industria Bancaria Chilena,” Economía Chilena, Vol.6, N°1, April. Central Bank of Chile (2009), Monetary Policy Report, January. Matus, J., D. Oda, and N. Silva (2009), “Caracterización de las Colocaciones Bancarias en Chile.” Studies in Economic Statistics N°73, Central Bank of Chile, March.