samchain/econo-pairs-v1 huggingface dataset:
For that reason, there has been an exponential increase in mechanisms to hold experts to account as more decisions require technical input. Michael Power describes the proliferation of such activity – not just financial audits but audits and reviews of boards, research quality, process reviews, environmental impact, independent evaluation offices, parliamentary inquiries, etc. 39  Critics argue that such “bean counting”  is costly, results in risk aversion, and diverts resources from important work. Having been on the receiving end of a great deal of this “checking,” I think it is a small price to pay to legitimize expert input to democratic decision making. Conclusion  So what have the experts ever done for us? The application of knowledge and the cumulation of that through education and dissemination through various media and institutions are integral to human progress. So the question is not how to manage without experts, but how to ensure that there are mechanisms in place to ensure they are trustworthy. More humility and candour about the limits of expertise is a starting point, as is clearer communication. More rigorous assessment of ideas will generate better solutions. Better tools to allow the public to differentiate among ideas are also needed, as is the need to encourage more genuine listening to others’ views. Managing the boundaries and accountabilities between experts and politicians better will help maintain the balance between technocracy and democracy. Getting this right is vital for determining whether our futures are shaped by ignorance and narrow-mindedness, or by knowledge and informed debate.

We all know who Bill Gates is and how he set up the most profitable software company called Microsoft. Bill Gates is now the richest man in the world and is spending most of his time doing charity work worldwide. Bill Gates is clearly an idol for lots of people, old and young, and a symbol of great success. But how come Bill Gates has become so successful? Many say he is a genius, both in computer programming and in doing business. But is it that simple? I have just recently come across a book written by Malcolm Gladwell, who has referred to an interesting thesis called the 10,000 hours rule. To understand this thesis, you have to look closer at Bill Gate’s life. No doubt Bill Gates is very clever and is extremely talented in computer programming. However, what made him so special as distinct from so many other equally clever and talented people in the past three to four decades is that by the time Gates dropped out from Harvard in his sophomore year in mid-1970s to set up his little backyard software company, he already had 8 solid years of non-stop computer programming experience, something that was exceptionally unique at that time for a young man just over 20. For a number of very peculiar reasons, Gates started his programming venture in as early as 1968 when he was just an eighth grade kid in a high school in Seattle.
Thomas C Baxter, Jr: Reflections on the new compliance landscape Remarks by Mr Thomas C Baxter, Jr, Executive Vice President and General Counsel of the Federal Reserve Bank of New York, at “The New Compliance Landscape: Increasing Roles – Increasing Risks” Conference, New York City, 23 July 2014. *  *  *  The views expressed are the views of the author and do not necessarily reflect the views of the Federal Reserve Bank of New York, or any component of the Federal Reserve System. Let me begin by thanking the Risk Management Association, PWC, Debevoise & Plimpton, and my friend Paul Lee for inviting me to participate in this conference. Of course, I need to give what sometimes sounds like a Miranda warning – my remarks are personal, and do not represent an official position of the Federal Reserve Bank of New York, or any part of the Federal Reserve System. There is nothing I will say that can be used against them. I am going to address three specific compliance problems: economic sanctions, tax evasion, and foreign corrupt practices. I will use these three compliance problems to illustrate a larger point about organizational culture. If organizational values do not support the rules that organizations use to guide the behavior of employees, and worse, if organizational values actually conflict with those rules, the organization is headed for troubled territory. In my remaining time, I will elaborate on this fundamental point. Let me start with economic sanctions.

The Iranian sanctions are designed to stifle the Iranian regime’s nuclear ambitions. The Cuban sanctions are intended to hinder the advancement of communism in the Americas and to change an oppressive regime through a trade embargo. For U.S. financial institutions, which operate on the basis of a public charter issued in the United States, the public purposes supporting economic sanctions and the detailed sanctions regulations are in harmony. With respect to rule compliance, the staff will follow those rules not simply because they are required to but also because they want to. While I am not here to speak for foreign institutions that have committed sanctions evasion, including BNPP, my sense from the evidence is that these institutions looked at economic sanctions very differently. They looked at economic sanctions as technical “American” rules that were not seen as consistent with the organization’s and the home country’s larger value system. In Europe, they found no similar sanctions, and there it was perfectly legal at the  BIS central bankers’ speeches  1  time to do business with these sanctioned jurisdictions. Some European bankers almost naturally adopted the view that there was no value system underlying the technical American legal rule. The foreign institutions saw the situation as providing financial services to just another country; not to a country committing genocide; not to a country building a nuclear weapon; and not to a country fostering a dehumanizing ideology. This failure to correlate the rule with the value is the root of real mischief.
Miguel Fernández Ordóñez: Reflections on the Spanish banking sector and economy Opening remarks by Mr Miguel Fernández Ordóñez, Governor of the Bank of Spain, at the “XVIII Encuentro del sector financiero”, organised by Deloitte-ABC, Madrid, 5 April 2011. *  *  *  Good morning, I am most grateful to Deloitte and to ABC for giving me this opportunity to share with you some reflections on the banking sector and economy of our country. In my talk I am going to take a hopeful view of the future of our economy and our banking system, based on the extent of the adjustment already under way and the progress made with fiscal consolidation and structural reforms. Let no one be mistaken, I am speaking about the future, because the present continues to be dominated by an overwhelming statistic: the more than four million who are unemployed. Until this number is significantly reduced, nobody is entitled to even hint at the slightest satisfaction. But it is true that, for the first time since imbalances began to build up in the late 1990s, Spanish society seems to be prepared to change and to undertake reforms that are absolutely essential, not just for growth, but for solid and sustained growth. And such change, perceived and appreciated by the markets, is the main base for a hopeful view of the future, although there is clearly still much to be done and no time for any let-up in our efforts.

The Banco de España has to approve or, where appropriate, require the necessary changes to be made to these plans, which must be implemented by 30 September, although the Banco de España may grant an extension of this deadline in the cases specified in the Royal Decree-Law. It is important to stress that the FROB is obliged to contribute the necessary capital to the banks which request it, as either a first or a subsequent option, to supplement or replace private capital. This contribution of government funds does not constitute, as some have argued, a nationalisation of banks, but rather exceptional and temporary support, since the  BIS central bankers’ speeches  5  FROB funds must be repaid or replaced by private capital as required by the Royal DecreeLaw. The participation of the FROB in this process enables an orderly entry of private investment in the savings bank sector. But what has been most effective to improve market confidence has been the very existence of the FROB as a backstop, assuring investors and lenders that, from the entry into force of the Royal Decree-Law, all Spanish banks are, de facto, operating with levels of core capital exceeding 8–10%. The entry of private capital will require savings banks to undertake a definitive and clear professionalisation of their management. This requirement is fortunate because it is a necessary condition for preventing a repeat of past events.
9  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  9  The cost of capital and employment The underlying point through all of this – that downside risks have particularly marked effects on decisions that are costly to reverse – is, I think, perfectly intuitive. One’s naturally wary about decisions that involve a degree of commitment but uncertain outcomes. Buying a house, taking a particular job, even getting married9: these are all decisions that are costly to reverse, to one degree or another, and that therefore require an extra degree of surety to be taken. You can also find examples of the same phenomenon within the economic sphere but unrelated to investment. Chart 8, for example, plots changes in our series on uncertainty against the ratio of two particular indices for hiring intentions – one for temporary posts, the other permanent – taken from the KPMG/REC employment survey. As you might expect, firms’ hiring intentions lean more towards temporary rather than permanent jobs, because the former involve less of a commitment, when they’re more uncertain about the future. Chart 8: Employment growth skews towards  Chart 9: More uncertainty boosts employment  temporary jobs when uncertainty rises  relative to investment  Sources: KPMG, REC, IHS Markit, Bloomberg Finance L.P., CBI, Consensus Economics, Dow Jones Factiva, Eikon from Refinitiv, GfK (research on behalf of the European Commission) and Bank calculations. Sources: ONS, Bloomberg Finance L.P., CBI, Consensus Economics, Dow Jones Factiva, Eikon from Refinitiv, GfK (research on behalf of the European Commission) and Bank calculations.

The blue line is a measure of the cost of finance for risky investments: it’s the profits of UK-quoted companies relative to their market value (debt as well as equity). The graph shows that, despite a protracted and significant decline in risk-free interest rates, firms have had to generate significantly more profits than in the past to raise a given amount of finance. The spread between the two lines is a measure of the risk premium on new investments, and it’s gone up significantly in the past few years, including since the EU referendum in 2016. Chart 11 carries a similar message. Here the orange line is a similar measure of that spread, between the rate of profit for private-sector firms11 and the yield on gilts. The blue line is the rate of growth of their investment spending. 10  In the simplified way that macro-economists sometimes use to describe the supply side of the economy, using a so-called “production function”, the elasticity of productivity with respect to the cost of capital – the proportionate response of the first to the second – is the product of two numbers: the share of national income going to capital (as opposed to labour), and something called the “elasticity of substitution” between the two inputs. In the data, the first is around one third; empirical estimates for UK put the second at around one half. Multiply the two and you get a figure of around one sixth. 11 The two charts use slightly different measures of profitability.
The criticism lived on for quite a long time, but it was probably quite essential to demonstrate at that time that the inflation target was taken seriously. This was until now the only time I can remember that the Riksbank was urged not to do its best to maintain confidence in the inflation target. The criticism then was largely due to the inflation-targeting policy being so new – as I said, the inflation target had not yet even come into force. It is less easy today, after twenty years of positive economic developments, in which the inflation target has been a cornerstone, to see why the Riksbank is being urged to lower its ambitions. Perhaps it is because developments have been so positive for so long that one feels the existence of a credible nominal anchor is no longer as important. If so, I am convinced that this is a mistake. Difficult to see reasonable alternatives to the policy conducted But what about developments in household debt and housing prices? Don't they give a reason for changing monetary policy? The Riksbank has previously used the repo rate to try to subdue the upturn in debt and housing prices. But this was on a fairly modest scale and – above all – during a period when confidence in the inflation target appeared firmly rooted. 9 In recent years, on the other hand, there have been signs that this confidence has begun to be undermined, which has changed conditions rather drastically.

When the repo rate is negative, the banks pay interest to the Riksbank, as the banking system as a whole has a liquidity surplus that must be deposited in the Riksbank. The short-term interbank rates, that is interest on loans between the banks, and some government rates have followed the repo rate down below zero. However, the banks have not introduced negative deposit rates for households and most companies. Only a few economic agents, primarily other financial institutions, large companies and some municipalities, have experienced a negative deposit rate, and these can in some cases also borrow at a negative interest rate. Companies have been forced to expend a certain amount of resources on avoiding negative return on their funds, but they appear to have succeeded relatively well in this. Cutting the repo rate below zero has thus in total contributed to pushing down interest rates, but has not meant that interest rates have become negative for the general public. Good profitability among the banks and few signs of a decline in demand Another fear has been that negative interest rates reduce the banks’ profitability, which could lead to higher lending rates and a lower supply of credit. The reason for this is said to be that the banks’ deposit margin, that is, the difference between the interest on deposits and lending, would decline because it is difficult to cut the deposit rate below zero.
The other question mark concerns the differences between countries, with inflation of 1.7% in Germany. However, following a temporary peak in the first quarter, German inflation is expected to remain under 2% on average throughout 2017. Moreover the inflation differences between countries are consistent with their different national economic situations: growth and employment are also stronger in Germany; and these differences could even contribute, via their impact on relative wages, to correcting the imbalances, hence achieving greater convergence within the euro area. I can naturally grasp the concern of German savers in the face of low interest rates. It is not our aim to keep interest rates low for too long: low interest rates are not a goal in themselves; they are merely the necessary condition today for gradually returning towards our inflation target, and ensuring lastingly higher interest rates in the future, as Mario Draghi himself has put it. This movement has already started for long-term interest rates, with the 10-year Bund gaining nearly 60 basis points since the end of September. In December, in view of the progress achieved, we decided to reduce the volume of our monthly asset purchases from 80 to 60 billion euro. I also repeat that although I am convinced that negative interest rates have their use, they have clear limitations. But, although QE will obviously not last forever, we clearly did not discuss tapering or any exit strategy.

Ravi Menon: An electronic payments society Keynote address by Mr Ravi Menon, Managing Director of the Monetary Authority of Singapore, at the Sim Kee Boon Institute Conference on FinTech and Financial Inclusion, Singapore, 19 August 2016. *  *  *  Distinguished guests, ladies and gentlemen, good morning. Singapore has embarked on a journey to become a Smart Nation. •  We want to embrace innovation and harness technology so as to increase the productivity of our businesses and enhance the welfare of our citizens. The financial services sector is well placed to play a leading role in the Smart Nation project. MAS has been partnering the financial industry to create a Smart Financial Centre, where innovation is pervasive and FinTech is used widely. We want to do this to: •  increase efficiency;  •  manage risks better;  •  create new opportunities; and  •  improve people’s lives. A key component of the FinTech agenda is payments. •  All of us – as consumers, employees, or businesses – use payments. •  Payments impacts every sector of the economy. •  So, getting payments right is important; and we need to get it right for the future. That future is digital and mobile, and it is already here. •  Our wallets are overflowing with cards of every type and form. We can dip them, tap them, and now, add them to our mobile phones.
[5]  Chart 1 Prices of bitcoin and selected altcoins (USD thousands)  Source: CryptoCompare. Notes: The data are for the period from 1 January 2015 to 15 June 2023 and are based on the price of crypto-assets as in the Crypto Coin Comparison Aggregated Index (CCCAGG) provided by CryptoCompare. The altcoins’ names are abbreviated as follows: Bitcoin (BTC), Ether (ETH), Polkadot (DOT), Ripple (XRP), Cardano (ADA), Litecoin (LTC), Chainlink (LINK), Dogecoin (DOGE), Binance Coin (BNB), Bitcoin Cash (BCH), Uniswap (UNI), Solana (SOL). Understandably, many are now questioning the future of crypto-assets. But the bursting of the bubble does not necessarily spell the end of crypto-assets. [6] People like to gamble and investing in crypto offers them a way to do so. [7] Crypto valuations are highly volatile, reflecting the absence of any intrinsic value. This makes them particularly sensitive to changes in risk appetite and market narratives. The recent developments that have affected leading crypto-asset exchanges have highlighted the contradictions of a system which, though created to counteract the centralisation of the financial system, has become highly centralised itself. Today I will contend that due to their limitations, cryptos have not developed into a form of finance that is innovative and robust, but have instead morphed into one that is deleterious. The crypto ecosystem is riddled with market failures and negative externalities, and it is bound to experience further market disruptions unless proper regulatory safeguards are put in place.

Jon Nicolaisen: Responsible investment and active ownership Speech by Mr Jon Nicolaisen, Deputy Governor of Norges Bank (Central Bank of Norway), at Norges Bank, Oslo, 19 November 2019. * * * The graphs can be found on the Norges Bank’s website. Introduction In 1990, visionary politicians decided to establish the Government Petroleum Fund, later renamed the Government Pension Fund Global (GPFG). On Tuesday of this week, the value of the fund passed NOK 11 000 billion – or over 3½ times Norwegian mainland GDP. The fund is now among the largest shareholders in many of the world’s listed companies. Chart: From natural resources to financial wealth What started as oil wealth in the ground has been transformed into savings and financial wealth abroad. Under the fiscal rule, we should only spend the expected real return on the fund. As long as we only spend the return, we ensure that the fund will benefit future generations. In 2020, withdrawals from the fund accounted for more than one krone in five in the central government budget. This means that the fund indirectly finances tens of thousands of public sector employees and ensures that taxes are lower than they would otherwise be. We might say that Norway has moved from being an oil nation to being an investment fund nation. The assets in the fund belong to the Norwegian people. The most important decisions, such the choice of the fund’s equity share, are anchored in the Storting (Norwegian parliament).
The Riksbank’s steering system is constructed to influence the shortest market rate, the overnight rate. This is the rate at which the banks manage their daily liquidity surpluses or deficits with each other. Interest rates for somewhat longer maturities are to a large extent determined, as you know, by expectations of future short-term interest rates. The idea is that by steering the overnight rate we also can affect interest rates further out on the yield curve. How do we steer the overnight rate in practice? First of all we lay down an upper and a lower limit – an interest rate corridor – for movements in the overnight rate. This we do via our standing facilities, which enable the banks to borrow or deposit funds overnight at the repo rate plus/minus 75 basis points. In addition, to ensure that the overnight rate is close to the repo rate, we perform a finetuning operation, if necessary, on a daily basis. For this operation, at the end of each bank day we are prepared to lend funds at the repo rate plus 10 basis points or to accept deposits at the repo rate minus 10 basis points. Our aim is that after the fine tuning, the banking system as a whole will be balanced. That means that we only lend the equivalent of the banking system’s net borrowing requirement or accept deposits for the equivalent of the banking system’s net investment requirement.

It has long been known, however, that strong growth in credit and money aggregates often signals or accompanies the emergence of bubble-like asset price movements or incipient financial imbalances. We can therefore expect to obtain useful insights, in the future, from this second pillar in the fulfilment of our financial stability mission. Looking ahead, central banks face significant challenges. They are well equipped, however, both in terms of expertise and institutional framework, to take on new responsibilities without in any way compromising their core mandate, their independence or their credibility. Thank you. References T. Adrian and H. Shin (2009), “Financial Intermediaries and Monetary Policy”, contribution to the Handbook of Monetary Economics, forthcoming. C. Borio and I. Shim (2007), “What Can (Macro-)Prudential Policy Do to Support Monetary Policy?”, BIS Working Paper No. 242. C. Borio and P. Lowe (2002), “Asset Prices, Financial and Monetary Stability: Exploring the Nexus”, BIS Working Paper No. 114. BIS Review 147/2009  3  R. Caballero, E. Farhi and P.-O. Gourinchas (2008): “An Equilibrium Model of “Global Imbalances” and Low Interest Rates”, American Economic Review, 98(2) 358-393. S. Dubecq, B. Mojon and X. Ragot (2009), “Fuzzy Capital Requirements, Risk-Shifting and the Risk taking Channel of Monetary Policy”, Banque de France DT 254. European Central Bank (2003), Background Studies for the ECB’s Evaluation of its Monetary Policy Strategy, edited by O. Issing. F. S. Mishkin (2008), “Monetary Policy Flexibility, Risk Management, and Financial Disruptions”, speech at the Federal Reserve Bank of New York, 11 January 2008.