samchain/econo-pairs-v1 huggingface dataset:
They also have had to pay more attention to evaluating business opportunities by using more sophisticated risk/return analysis than they previously did, a strategy financial firms have been particularly aggressive in pursuing. What lessons might other countries thus draw from the US experience and what are the implications of the strong economic performance in the United States for other countries? One lesson seems clear. With the advances in technology, all countries that move toward more open and transparent markets stand to benefit from the universally available strides that have been made in information technology. I want to emphasize that the processes I am speaking about do not call for just onetime efforts. Quite the contrary. They demand ongoing attention and adaptation to new circumstances. Second, it is not just that productivity growth is being driven by technological advances. It is also a question of how these technological advances are applied. At the end of the day, I believe, the United States has had such strong economic performance because of the high degree of flexibility and adaptability that has been built into the US labor, product and financial markets over the past decade. BIS Review 29/2000  4  These lessons seem to be gaining a following, as many countries across the globe have begun to record substantial progress in liberalizing and deepening their capital markets, deregulating their state-owned enterprises, and easing existing labor market rigidities. In so doing, these countries position their economies to capture the manifold benefits technological advances allow them to enjoy.

Notably, it is true that as the unemployment rate has come down, the pace of wage gains has increased. But what is different in the current environment is that productivity growth has increased roughly in tandem with the rate of compensation growth, thereby negating the inflationary impulses of these wage gains. Thus, probably the most notable feature of the remarkable expansion in the US economy over this past decade has been a rebound in the growth rate of productivity. Whereas the productivity growth rate had languished at the 1½% level throughout most of the 1970s and 1980s, it rose steadily over the decade of the 1990s, reaching an astonishing 5.7% annual growth rate in the second half of 1999. The question that remains unanswered - and troublesome - is whether this significant improvement in productivity growth, which has made the US economy one of the most competitive in the world today, is temporary or permanent. What is less often taken into account is that the US productivity boom of the 1990s has taken place against a background of very low inflation in the United States and rapidly decelerating inflation in almost every region of the world. Through much of the 1990s, weak economic performance elsewhere in the world has held down commodity price inflation and strengthened the dollar.
Without reference to interest rate smoothing, the main scenario is marginally preferable for  = 0.3. 10  BIS Review 22/2010  Figure 4 Monetary policy alternatives for Norges Bank, March 2005 Alternative repo-rate paths 8,0  CPI-ATE 3,0  P er cent, quarterly averag es  6,0  Annual percenta ge change  2,0  4,0 1,0  2,0  0,0  0,0 02  03  04  05  06  07  02  08  03  Mean squared gaps Production  2,0 Low  1,0  05  06  07  08  07  08  Output gap  4,0  1,5  04  Per cent  2,0  Main  0,5  0,0  High  0,0  -2,0 0,0  0,5  1,0 CPI-ATE  1,5  Main  2,0  02  Lower  03  04  05  06  Higher  However, the use of quantitative measures of monetary policy does not signify that these measures will always be the only guiding stars. The Riksbank and other central banks with inflation targets previously used a rule of action according to which the policy rate would be increased or decreased depending upon whether the inflation forecast, calculated for a constant future interest rate, would be above or below the inflation target two years ahead. At the same time, the Riksbank emphasised that deviation from this rule of action could be justifiable in certain situations.

Such an interest rate path would not entail any problems for financial stability or the functionality of the financial markets. Housing prices and mortgages do not comprise stability problems and should not affect monetary policy. Any future problems on the housing markets, or, indeed, any future problems with financial stability whatsoever, can best be managed through regulation and supervision. The repo rate is an altogether too blunt and unsuitable instrument to be used for any other purpose than stabilising inflation around the inflation target and resource utilisation around a normal level. Monetary policy should be directed towards stabilising both inflation and resource utilisation According to the Sveriges Riksbank Act, “the objective for monetary policy is to maintain price stability”. The objective is thus price stability. The Riksbank has specified this as an inflation target of 2 per cent. This means that monetary policy should stabilise inflation around the inflation target. Furthermore, in the preparatory work for the Sveriges Riksbank Act (Prop. 1997/98:40), it is stated that “as an authority under the Riksdag, the Riksbank, without prejudice to the price stability market, should furthermore support the goals of general economic policy with a view to maintaining a sustainable level of growth and high rate of employment”. How should this be interpreted? What is the best contribution monetary policy can make towards maintaining a sustainable level of growth and high rate of employment? It is to stabilise resource utilisation around a normal level.
Norman T L Chan: A fascinating train journey Speech by Mr Norman T L Chan, Chief Executive of the Hong Kong Monetary Authority, at the CUHK (The Chinese University of Hong Kong) Business School Master Degree Graduation Ceremony 2015, Hong Kong, 21 November 2015. *  *  *  Professor Michael Hui, Professor Kalok Chan, parents, graduates, ladies and gentlemen: 1. It is a great honour to be invited to attend today’s graduation ceremony. It is also a great pleasure to be back to CUHK, where I spent the most beautiful part of my life as a student. There were so many fond memories and I cannot tell you how much I have missed my campus life even though I have graduated for nearly 40 years. 2. My fellow graduates, today is a memorable and joyful occasion not only for you, but also for your parents, your family, your loved ones and your friends. You have all worked very hard and gone through many rounds of examinations and challenges before you can be here today on this occasion. You must feel very proud and wish to tell everybody that “I have made it”. My heartfelt congratulations to you all: you have made it. You have received a master degree that provides you with the knowledge and skills that are badly needed and sought after in the modern era of business and finance.

The simple truth is, unless you are on a train, you don’t have the chance to move forward and will never come closer to your destination: Success. BIS central bankers’ speeches  1  5. If you feel that I should not be depicting a rather scary train journey on this auspicious and joyful occasion, then please forgive me and let me try another scenario for you to think about, again using my train journey story. 6. Suppose that you have been bumped off the train once or twice and have found your way back onto the next trains to carry on with the journey. You will gradually realise that there are certain rules and disciplines on the train that determine who get the good seats, who can be upgraded from the economy cabin to the business class and then the first class cabin. There are also rules and booking system that govern who can enjoy a good meal at the dining car and when. So you will come to realise that the train is not a wild jungle filled with animals, or people, trying to eat each other alive. You will also discover that there are some passengers who have got upgraded to the business or first class cabin not just because they are muscular or clever. They are ahead of most other passengers because they possess certain qualities that we in modern time called leadership.
What we are doing is in full conformity with the spirit of the Treaty. HB: Why are you now being criticised by the banks? Trichet: Are we? If so, it is probably because we are doing things that we have not been asked to do by them. That would be proof of our independence vis-à-vis interest groups. That refutes the argument that we have acted as a result of pressure from the banks. I am therefore very pleased to be being criticised by the banks. HB: You don’t see any threat to the ECB’s credibility? Trichet: After the first 12 years of the euro, despite all difficulties - oil and commodities shocks and financial crisis – we will have delivered price stability fully in line with our definition, less than 2% close to 2%. That is the proof. The Executive Board and the Governing Council are inflexibly attached to price stability. And our credibility does not rely on words but on deeds and on our own track record. HB: And is this also valid for the decision taken during the weekend? Trichet: As regards our Sunday decisions they were of the same nature as those taken earlier in the crisis when we adopted non-standard measures. Where necessary we take our decisions swiftly, like in 2007 and 2008, but without ever losing our sense of direction: medium- and long-term price stability. HB: The Governing Council’s most recent decision was not unanimous. Was there an argument?

The Inland Revenue Department became the first government department to participate in the Pay e-Cheque portal, providing a convenient and easy option for paying tax demand notes, business registration fees, and stamp duties as well as purchasing tax reserve certificates. III. Lastly, the Treasury has also actively helped promote the acceptance by other government departments of e-Cheques in paying general demand notes. 6. I would like to thank all those involved in bringing the e-Cheque service into fruition. The HKMA will strengthen public education programmes with the Hong Kong Association of Banks to increase public understanding of the use and benefits of e-Cheques. 7. Thank you. 2  BIS central bankers’ speeches
If that consensus exists, we stand ready to work with the market to deliver this complementary tool. We strongly encourage market participants to engage on this consultation and look forward to receiving responses. 15  For presentational reasons, Figure 3 shows the SONIA index and compound rates over different time periods from those shown in Section 2 of the accompanying Discussion Paper, but the underlying data and calculation methods are identical. 9  All speeches are available online at www.bankofengland.co.uk/news/speeches  9  Transitioning the Bank of England’s lending facilities away from LIBOR  Our second announcement today also relates to our presence in the market – specifically, how we treat LIBOR-linked collateral in our Sterling Monetary Framework lending operations. We released a discussion paper on this topic last year and today we set out the actions we intend to take. Our lending operations are designed to provide liquidity support to market participants experiencing either a predictable liquidity need or a firm-specific or market-wide shock. We lend to firms against a wide set of eligible collateral. But to protect public funds we apply a risk-averse ‘haircut’ to that collateral to protect against possible falls in its value in the period between a counterparty default and collateral sale, including in times of potentially severe stress. The current average haircut on pre-positioned collateral is a little under 25%, giving the Bank a lending capacity of over £ after accounting for existing lending (for example under the Term Funding Scheme).

10  All speeches are available online at www.bankofengland.co.uk/news/speeches  10  FIGURE 4: Haircut schedule for LIBOR-linked collateral  This graduated approach reflects the clear feedback we received from firms on our discussion paper last year. It is intended to give firms the incentives, certainty and time they need to prepare for LIBOR transition, replacing LIBOR-linked collateral with risk free rate alternatives and maintaining drawing capacity throughout. Careful analysis suggests that this should be a manageable task in the time available, but we will monitor this closely and continue to work with impacted firms on their plans. Concluding remarks  I began my remarks by comparing LIBOR transition to a motor race. For some, I know it may have felt at times more like a Le Mans endurance race than a Grand Prix. But dawn is at last approaching – and the finish line is drawing nearer. For sterling markets in particular, 2020 is a critical year. The announcements we have made today, coupled with the huge efforts going on right across the private and public sectors, demonstrate I hope that, working together, we can keep sterling markets at the forefront of LIBOR transition. Thank you. 11  All speeches are available online at www.bankofengland.co.uk/news/speeches  11
The deviations enter the loss function quadratically. Large deviations from the targets are thereby deemed to be a considerably more serious disadvantage than small deviations. In the event of large deviations between inflation and the inflation target, or substantial imbalances in the real economy, the use of relatively strong measures may be appropriate. The trade-off between inflation stability around the inflation target and stable growth in output is expressed by parameter . The higher is, the greater the emphasis on real economic stability in relation to stability in inflation. With a is the definition strict inflation target, i.e. emphasis is only placed on inflation, is equal to zero. of flexible inflation targeting. Although the loss function has two add factors, both of which are given emphasis, a fundamental difference is that the monetary policy authorities can choose the inflation target but not the level of potential output. In practice, no central bank uses a loss function of this kind directly. What inflation-targeting central banks do in practice does, however, contain elements of the thinking behind this theory. 6  See the box “Flexible inflation targeting and indicators of pressure in the real economy” in Inflation Report 3/03, p. 46, for a more detailed description of the different indicators. 7  See for example Svensson, Lars E. O. (2002): “Monetary Policy and Real Stabilization”, in Rethinking Stabilization Policy, A Symposium Sponsored by the Federal Reserve Bank of Kansas City, Jackson Hole, Wyoming, August 29-31, 2002, pages 261-312.

In practice, the distinction between risk and uncertainty is not absolute; rather, there is a continuous scale. We never have complete knowledge of the probability distribution of the economic variables, although historical experience provides some indication. But some variables are characterised more by risk, in the sense that the range of outcomes is well specified, than others. Let’s look at some concrete examples. Projections for wage growth are important for the conduct of monetary policy. For a given wage formation system, the outcome of wage negotiations is characterised more by risk. We do not know with certainty in advance what the outcome will be, but historical experience provides us with information about the probability distribution. However, the probability distribution depends on no change having taken place in the wage formation system. Such changes may occur, but we have little basis for judging the probability of this. If a change has actually taken place, however, we have little information about the probability distribution for the outcome of wage negotiations in the future. Whereas wage growth projections were previously characterised more by risk, they are now characterised more by Knight uncertainty. Another factor is the rise in prices for imported goods. There have been major structural changes in world trade, with intensified competition and China’s WTO membership. It is still too early to establish the effects of these factors on inflation abroad or how long the process of change in world trade will persist.
Key rates and rise in labour costs Per cent Interest rates 8  New Zealand Australia Canada UK US Denmark Euro area  6  Norway  4  Sweden 2  Japan 0 0  2  4  6  8  Rise in labour costs, 1998-2000  Norwegian key rates are currently 1½ percentage points higher than in the US, 2¼ percentage points higher than in the euro area, and 3 percentage points higher than in Sweden. In some countries, short-term interest rates are now moving down and in other countries expectations of interest rate increases have receded. Norges Bank has a neutral bias with regard to interest rates developments, partly reflecting price and cost developments in Norway, as illustrated in the chart. In general, it can be argued that when wage and cost inflation is expected to rise and deviate from the rate of increase in the euro area, or when unexpected upwards shifts in labour costs occur, interest rates must be raised to avoid rising inflation and a weaker krone. In our open economy, with a floating exchange rate, it can be assumed that an increase in wage growth of one percentage point will gradually translate into a corresponding increase in price inflation unless the wage increases are anchored in higher productivity. The magnitude of the increase in interest rates must be consistent with this. First, nominal interest rates must be increased in order to maintain real interest rates.

But preserving the interests of the EU, its citizens, its businesses, its Member States, means that the agreement with the UK should not undermine what we have managed to achieve in Europe in the economic field: one of our strongest assets is our single market; it removes all internal borders and regulatory obstacles to the free movement of goods, capital, services, and persons in the European Union. For the sake of consistency, there is one principle in particular to which we have to stick in preparing the agreement between the EU and the UK: in the single market, you cannot separate access and rules. For the financial services industry, this means that you can hardly expect to obtain a European passport if you do not accept the single market's rules. London is and will remain in the future a global financial centre, but the architecture of the European financial system may have to evolve in this regard. We cannot foresee the outcome of the negotiations – which I hope will be in the interest of both parties – but all actors should as of now undertake all the necessary preparations to avoid any potential “cliffedge” risk. London will and should probably continue to attract and transform savings from all over the world.
The conflict in Ukraine and the sanctions levied on Russia had consequences for the Russian economy but also created unease over the political and economic development of eastern and central Europe in general. We saw drastically reduced demand from the global growth engine of recent years, China. This gave new fuel to concerns over an imminent hard landing of the economy there. The severe conflicts in the Middle East started to make themselves increasingly felt via a heavy increase in the numbers of people seeking safety in Europe. The possible effects of the central banks acting out of step – after a number of years of crisis policies – also led to a degree of concern. There is always uncertainty but, nevertheless, my impression is that it has been unusually high over the past year. Uncertainty in itself can cause problems as it can lead households and companies to hold off consumption and investment, and can reduce companies’ willingness to raise their prices. Everything else being equal, a higher degree of uncertainty therefore argues for a more expansionary monetary policy. In addition, greater uncertainty over international developments also entails a greater risk that the Swedish economy will be exposed to such strong negative pressure that we will end up in a really serious situation with persistently falling prices and employment. A desire to lower the chances of such a situation may, in itself, argue for a more expansionary monetary policy.

As a component of trust, fairness involves being aware of such differences and to find ways to prevent, mitigate or compensate redistributive effects that are particularly undesired. Within an institution, fairness also involves the creation of a working environment that fosters productive exchange of ideas, free of harassment and discrimination. Fostering trust in a Central Bank The OECD taxonomy may be useful in providing a conceptual basis to go beyond generalizations on public trust and to take a more proactive approach to nurture it. In particular, it provides a good framework to develop ways to assess trust and to identify concrete levers that an institution can use to foster trust. However, can this framework be applied to a central bank? In my view, this is not only possible, but necessary as well. Assessing trust on a central bank by inserting a question in an opinion survey suffers from the same limitations as with government institutions and a few more. Answers to a broad question may be more reflective of prejudice than of attitudes that may shape the response to future policy decisions or incoming information and may come too late in a process of social or market change to make any difference. In addition,  Page 5 of 8  Central Bank of Chile July 2019  experience with opinion surveys in different countries has shown that no more than half of respondents have some basic knowledge of central banks.