samchain/econo-pairs-v1 huggingface dataset:
However, such crimes are more common in counties that have weak security, or suffer from weak economy and weak judicial and supervisory systems. Among the most prominent negative effects of this phenomenon is the flight of money abroad, with production losing its most important element, namely, capital, hindering production of goods and services, raising unemployment and reducing savings. As a result, investors lose confidence in the economic system and the legislation governing it, creating an anti-investment environment. All this will be reflected on economic growth and the standard of living of society. Money laundering may also result in the availability of liquidity in quantities not commensurate with the increase in production of goods and services, thus increasing inflation and decreasing the purchasing power of the currency. Money laundering affects the country’s position and its reputation among international bodies, and may give misleading economic indicators. From the social point of view, it is significantly dangerous as it leads to non-productive classes acquiring illegal proceeds at the expense of productive classes, increasing the gap between social classes. Moreover, It increases the opportunities of spreading corruption and bribery. Dear Audience, I would like to commend the fruitful coordination and cooperation between the appropriate entities of ministries, security and judicial authorities, and financial and non-financial institutions for combating money laundering.

One consequence of structural change is that when old sectors or companies fail to survive, scope for new employment is created in sectors where the country enjoys a comparative advantage or in domestic services that are not exposed to competition to the same extent as the goods sector. For a long time, the growth of the public sector compensated for the drop in employment in manufacturing and created new jobs at an even faster rate than the old ones disappeared. If such a change process is to proceed quickly and smoothly, it requires a lot in terms of the ability to adjust and the flexibility of people and companies. It also requires that policy facilitates the ability to adapt through the design of regulatory systems. The labour market has to function in a satisfactory way and it must be feasible to make the time difference between closure and new establishment as short as possible. In other words, it is a question of reducing the frictional unemployment that arises when industries or companies are wound up and people need to move or retrain in order to find work in a new location or in a new company or industry. The fact that employment is so low in Sweden today, given the state of the economy, may be a sign that the labour market is not flexible enough to meet the demands imposed by tougher competition or that the economy is not sufficiently dynamic. 1  IMF’s definition.
Out of the total, only a small part of the SDR allocation  BIS Review 120/2010  5  will benefit countries which may effectively need to use them. More may be needed to substitute for national foreign exchange reserves as a permanent insurance mechanism. Contingent liquidity The search for new liquidity sources meets with an inescapable moral hazard problem. On the one hand, to be equivalent to reserves going forward, multilateral liquidity must be available ex ante and without condition. On the other, there is a danger that fully unconditional liquidity be used to deal with fundamental “solvency” imbalances. In real life, this is not an easy distinction to make. The dilemma is solved, at the domestic level, by the provision of eligible collateral. This may prove very uneasy for international liquidity: transferring ownership of substantial amounts of sovereign assets between countries or to international institutions would meet with huge legal and political difficulties. This is the rationale for conditionality. But, of course, conditionality creates an uncertainty which is incompatible with the purpose of instant supply of liquidity. A conditional facility will never be a perfect substitute for reserves. Many countries fully eligible to the Flexible Credit Line (FCL) have used foreign swaps instead. Anecdotal evidence suggests that swaps are often perceived as carrying less of a stigma effect.

Empirically, the behaviour of the economy matters more for interest rates than prior forecasts. In addition, the MPC isn’t solely concerned with inflation anyway, still less its most likely rate at a fixed point in the future. That means that the target horizon for inflation is generally longer than the earliest point at which policy can affect it – there is therefore no single, unique path of interest rates that will do the job. It also means that the horizon itself can vary. I will therefore conclude with something of an apology. For those in the audience wanting me to give a direct and unequivocal promise as to when Bank Rate will change, you will, I’m afraid, be disappointed. I can’t. But you should look on the bright side. If there is any value in listening to people like me, it is to help you with what is the best way to try and predict future interest rates - to forecast the economy yourselves (which is probably more interesting). After all, if the future were perfectly predictable we wouldn’t have to bother trying. References Broadbent Ben, 2014, “Unemployment and the conduct of monetary policy in the UK”, Speech given at the Federal Reserve Bank of Kansas City 38th Economic Symposium, Jackson Hole, Wyoming. Campbell John, 1995, “Some lessons from the yield curve”, Journal of Economic Perspective, Vol. 9, No. 3. Eguren-Martin F. and N. McLaren, 2015, “How much do UK market interest rates respond to macroeconomic data news?”, Bank of England Quarterly Bulletin.
2 Dir.2016:114  2 [14]  unfortunately be disappointed. My somewhat more modest aim is to make a contribution to the discussion by examining the distributional effects of the policy and adding shades of meaning to these effects. What I hope to convince you of today is that monetary policy also affects household income and wealth in ways that are more indirect, but probably more meaningful, than via asset prices. While an expansionary monetary policy entails rising asset prices in the short term, this is compensated by lower unemployment, higher employment and stronger growth. A monetary policy that succeeds in the task of attaining price stability also counteracts the negative distributional effects of inflation. An expansionary monetary policy to defend the inflation target But, as I said, rising asset prices have been an element of the economic upturn in recent years. And during periods when stock prices are rising, the income distribution is more uneven between households – this can be seen from standard measures of dispersion of the income distribution, such as the so-called Gini coefficient (see Figure 1). Figure 1. Gini coefficient for disposable income and stock market movements 0.32  Stock index (right scale)  650  Gini, excl. capital gains (left scale) 0.30  Gini, incl.

After recovering in the last quarter of 2011, private consumption slowed down in the first quarter of 2012. The performance of imports of consumer goods and the low annual growth of VAT revenues suggest sluggish consumer demand over the quarter under review. This assessment is also supported by qualitative data obtained from consumer, business and banking sector surveys. The dynamic of quantitative and qualitative indicators also suggests a sluggish performance of investment. BIS central bankers’ speeches  1  Against a background of low demand and spare production capacities, and in the presence of uncertainties for the developments at home and abroad, businesses have postponed their new investment-related decisions. In addition, the contribution of public investment to aggregate demand growth was negative in the first quarter of 2012. The Government pursued a prudent fiscal policy in the first four months of the present year, translated into the annual reduction of the budget deficit by 28% during this period. Budget revenues continue to record moderate annual growth rates, reflecting the performance of economic activity and providing evidence for the mutual impact between the public and private sector dynamics. The Bank of Albania, however, points out that pursuing a fiscal policy oriented toward the long-term sustainability of budget and public debt figures will provide clear medium- and long-term benefits to the Albanian economy, in the form of lower risk premiums, greater room for private sector financing and, ultimately, lower financing costs. This policy is also in line with the developments in domestic and foreign financial markets.
Strategising the exit of measures in the recovery phase Ladies and gentlemen, let me share some of our thinking in approaching the exit strategy, which in part, is informed by our experience from past crises: 1. First, given the uncertainties, we continue to be vigilant and therefore remain prepared to dip into our policy toolkit to manage some of the risks and spillovers from support measures that we instituted. In our context, the extension of repayment assistance programme has been accompanied by strengthened supervisory expectations on monitoring and stress testing of exposures under repayment assistance. Further, we have also increased supervisory reporting requirements on such exposures and focused monitoring on more forward-looking indicators such as banks’ internal MFRS 9 staging of exposures for purposes of macro- and micro-prudential surveillance to facilitate timely decision-making. 2. Second, frequent engagements with banks have helped to provide timely and steady steer in ensuring their support of the recovery, without compromising resilience. For example, banks were not only expected to allocate resources and management attention to support repayment assistance efforts, but also effectively monitor the attendant risks arising from these efforts. As a result, we saw banks strengthening their own capacity to cope with the sharp increase in debt restructuring applications and support tailored repayment assistance plans for viable borrowers. In addition, notwithstanding the flexibilities granted under accounting standards, banks have maintained prudent asset classification and provisioning practices when assessing borrowers’ creditworthiness.

In addition, trading income recovered strongly as financial markets rebounded after the first quarter of 2009. Finally, revenues from fees and commissions held up remarkably well throughout the financial turmoil. At the same time, a number of significant risks remain and some may have even increased. First, the slowdown in the growth of assets held by euro area banks limits their future earning capacity in terms of interest and investment income. Second, a deterioration in the credit quality of borrowers may put a drag on banks’ future earning capacity. In fact, while large and complex banking groups seem to be gradually absorbing the losses they suffered on their securities holdings, driven in part by the reclassification of assets, they have reported sharply higher provisions for loan losses. Let me now turn to capital ratios. The recovery in the earnings of large and complex banking groups in the euro area, together with a slowdown in the growth rate of both risk-weighted and total assets and an increase in capital, from both public and private sources, has meant that the capital ratio of the average banking institution has typically been relatively stable. There is, however, considerable divergence between groups. A somewhat reassuring finding is that the institutions which reported the largest increases in loan loss provisions also seem to have the highest capital buffers. This may mitigate the solvency risks originating from deteriorating asset quality in the future.
The level of investment in the US was high during the expansion, which may have resulted in excess capacity in the business sector. The fall in equity prices is having a negative effect on household wealth. In addition, US household saving is low and low interest rates have induced households to accumulate debt. The fall in the value of the dollar may make a contribution, but growth in the business sector is still not self-driven and the depreciation of the dollar is reducing other countries’ exports. The impetus generated by the US economy may be weak for several years ahead. Nor is the rest of the world showing clear signs of an imminent recovery. Japan is dragging down growth in the world economy. The large European economies, in particular Germany, are stagnating. Unemployment is high, but the growth potential appears to be low. Interest rates in the US and Japan have been reduced to such a low level that there is little room for further stimulus. The monetary policy authorities could use more unorthodox measures. For example, the central bank could purchase massive volumes of long-term bonds - as seen in Japan - or other assets. It is uncertain how effective such measures are. Traditional fiscal policy instruments may also prove to be ineffective when budget deficits are rising sharply. This may fuel expectations of future fiscal retrenchment and tax increases. If the world economy continues to stagnate over a longer period, the effects will also spill over to the Norwegian economy.

When expectations were lowered, equity prices fell. The decline was amplified after the downturn in the global economy deepened as a result of terror and fears of war. Investors sought to avert the risk in the stock market. Demand for bonds increased, resulting in low long-term interest rates. Chart 3. A war economy? Index. January 2001=100 110  150  Swiss franc (left-hand scale)  105  125  100  95  100  Oil price (right-hand scale)  Gold reserves (right-hand scale) 11 September  75  Resolution 1441  90 2001  50 2002  2003  Source: EcoWin  In response to heightened uncertainty and fears of war, traditional safe havens for capital, such as the Swiss franc and gold, have become increasingly attractive. The Swiss franc appreciated after the terrorist attacks on 11 September 2001 and towards the end of last year. Gold prices moved up sharply after UN Security Council Resolution 1441 was adopted on 8 November last year. Oil prices fell markedly after 11 September 2001, but have since risen. Fears of war in Iraq have increased the uncertainty surrounding global oil supplies. Strategic oil reserves have risen, while private reserves are low. This has exerted upward pressure on oil prices. The strike in Venezuela has also had an impact. Major economies such as the US, Germany and France are struggling with stagnation and fears of recession. Substantial tax relief and low interest rates are holding up activity in the US.
And, increasing student debt burdens have made it more difficult for many young adults to become homeowners.3 This is significant because homeownership is a major avenue for wealth accumulation for many households. Nevertheless, the tightening labor market should provide greater opportunities for workers to obtain employment, build human capital, and gain greater opportunities to improve their financial circumstances. On the business side of the ledger, investment spending should remain solid. Business cash flows are strong, and the corporate sector is set to receive a meaningful lift from the recently 1/6  BIS central bankers' speeches  enacted tax legislation. The large reduction in the statutory corporate income tax rate from 35 percent to 21 percent and the 100 percent expensing provision for investment should drive down the effective cost of capital for business. In addition, the U.S. economy should be well supported by the recent improvement in the global economic outlook. More synchronized cyclical recoveries in Europe and Japan—and a revival of growth in many emerging market economies—should ensure that demand for U.S. goods and services remains strong. Putting it all together, I have raised my real GDP forecast for 2018 by about half a percentage point to three quarters of a percentage point to a 2½ percent to 2¾ percent range. About onethird of this upward revision reflects the firmer momentum of the economy going into 2018 and about two-thirds the stimulative impact of the tax legislation.

While this legislation will reduce federal revenues by about 1 percent of GDP in both 2018 and 2019, I anticipate the boost to economic growth will be less than that. Most importantly, most of the tax cuts accrue to the corporate sector and to higher-income households that have a relatively low marginal propensity to consume. This suggests that a significant portion of the tax cuts will be saved, not spent. On the business side, the boost to investment from the lower corporate tax rate and full expensing is likely to be relatively modest. In the past, aggregate investment spending has not been very sensitive to the cost of capital, which is only one of many factors that influence investment spending.4 Moreover, the reduction in the effective tax rate for corporations—or what they typically pay in practice—is only about 3 to 4 percentage points, far smaller than the reduction in the statutory rate. On the household side, the impact is likely to be attenuated by the temporary nature of many important provisions. Households may not spend much of the additional after-tax income if they perceive the gains as likely to be transitory. Finally, the legislation is likely to generate some frictional costs that will mitigate its effects on growth. In particular, it likely will have disparate impacts regionally and across economic sectors. For example, the $ cap on the amount of state and local income and property taxes that can be deducted will raise the effective cost of owning higher-end residential property in high-tax states.
The implementation of Basel II will pose a challenge to the entire  BIS Review 42/2006  1  financial community, while for the newly emerging economies this process will be a serious test since their banking systems are very much open. The discussion of the common supervisory framework also brings forward the question as to what extent the high rates of growth of credit for the private sector, globally, and in many of the dynamically developing countries, in particular, poses a risk to financial stability and how much supervisory policy could be used as a tool for solving this problem. The process of financial sector globalisation, which I already mentioned, raised for many countries the issue of choosing between either following a national monetary policy or joining a monetary union and carrying monetary policy to a supranational level. The experience of a successful realisation of the Economic and Monetary Union in Europe, as well as the experience of the countries from the area of the Frank are a good practical example for all of us about the potential advantages and challenges associated with a country's participation in a monetary union. Taking monetary policy to a supranational level is inevitably related to providing greater independence for the national central banks and delegating certain powers at a supranational level. In the democratic world, the independence of conducting policy on the part of central banks is inseparably linked to the higher degree of their transparency and reporting.

Looking at our experience over the last decade, there is a good case for bringing financial stability higher in our priorities. That may imply, in particular, that, when assessing the economic and financial environment, central banks should take a longer term perspective and be more alert to incipient financial imbalances. •  I would note, in passing, that the Eurosystem is well equipped to take such a perspective. Our "two pillar "approach allows us to look permanently at the dynamics of money and credit aggregates, which are essential to detect both long term risks to price stability and potential threats to financial stability. •  But more should be done. It is now broadly accepted that a "macro prudential" approach should be taken when implementing financial supervision. That means looking both at system wide implications of our prudential decisions and their impact on financial imbalances and the real economy. •  Central banks have a major role to play in this process for four reasons: (1) they have an incentive to act, since well functioning financial markets are essential for the transmission of monetary policy; (2) being equipped to permanently look both at financial markets and economic cycles they may have an informational advantage in analyzing their interaction; (3) there independence allows them to produce dispassionate and candid assessments of risks; (4)and, finally, their proximity to the banking system provides them with an intimate knowledge of financial dynamics.
Last year Sweden had one of the largest surpluses in public savings in the EU, which enabled an expansionary fiscal policy. The slowdown in 2001 also differs from the problem periods during the 1970s and 1980s in that the manufacturing industry’s competitive situation was very strong from the start. The weakening of the krona began as soon as one year before industrial activity slowed down and contributed to a strong development in net exports during 2001. Nor was it lack of competitiveness or a decline in productivity that lay behind the depreciation of the krona - it was financial flows resulting from the decline on the  BIS Review 37/2002  5  stock market and portfolio investments connected with the AP pension funds being given the opportunity to invest some assets abroad. A recovery in the Swedish economy has now begun and the Swedish economy has a good foundation to stand on, with a surplus in both the central government finances and in Sweden’s trade abroad. Inflation is on the way down. At the same time, wage formation and pricing behaviour in general will comprise an uncertainty factor when economic activity gradually picks up speed. It may therefore be necessary to implement further interest rate hikes in future. However, the next monetary policy stage depends, as always, on what happens with regard to economic activity, inflation and in the world around us.

This can be compared with the 1970s and 1980s, when inflation was approximately 8 per cent and growth was on average 2 per cent. Contributing to this positive development was the fact that  BIS Review 37/2002  1  there was good access to free resources in the economy after the crisis years at the beginning of the 1990s. An important part of the Riksbank’s monetary policy strategy is clarity and openness with regard to the bases for monetary policy decisions. The purpose of this is to create support for the price stability target and understanding of what governs the interest rate decisions among the general public. This is also the reason why we Executive Board members often travel round making speeches. Openness and clarity on our part can contribute to stabilising inflation expectations in society and reduce the risk of unnecessary tension on the financial markets. As monetary policy has an effect with some time lag, interest rate decisions are based on forecasts of price developments one to two years ahead. If the forecasts show a rate higher than the inflation target, the interest rate is raised, and vice versa. In other words, the instrumental rate is adjusted so that the total assessment of inflation 1-2 years ahead, taking into account the risk scenario, is in line with the target. The assessments are described in the Riksbank’s Inflation Reports, which are issued 4 times a year.