samchain/econo-pairs-v1 huggingface dataset:
Institutional memory can help lengthen and strengthen otherwise short and subjective minds. And institutional investment can help build public goods and flatten otherwise fat tails. In other words, institutions are the perfect antidote to the dark sides of integration and information. BIS central bankers’ speeches  5  Institutions in economics and finance These features of institutions – memory of the past, investment for the future – are particularly acute when tackling economic and financial policy problems. Very often, these involve difficult trade-offs between today and tomorrow: is growth today worth trading-off against higher inflation tomorrow or a greater probability of crisis the day after tomorrow? Not only are these choices difficult, but policymakers may have an inbuilt tendency to get them wrong. In economics, this is often termed the “time consistency” problem (Kydland and Prescott (1977)). The problem arises when policymakers have incentives to promise good behaviour ex-ante, but then renege on that promise ex-post. Policymakers are prone to making St Augustinian pledges to be chaste, just not yet. This is a classic myopia trap. The roots of this problem are often felt to be political – a desire to court near-term popularity to achieve re-election. Yet the true roots may be more neurological than political. Experimental evidence shows that people’s preferences are themselves time-inconsistent or “hyperbolic” (Laibson (1997)). People become increasingly myopic as payoffs become visible, elections approach, nest eggs near hatching. This is true for everything from pigeons pecking corn to mothers seeking pain relief during childbirth (Haldane (2010)).

“Rounding the Corners of the Policy Trilemma: Sources of Monetary Policy Autonomy”, American Economic Journal: Macroeconomics 2015, 7 (4): 33–66, http://dx.doi.org/10.1257/mac.20130237. Krugman, P. (1999). Balance Sheets, the Transfer Problem, and Financial Crises, in International Finance and Financial Crises: Essays in Honor of Robert Flood, edited by Peter Isard, Assaf Razin and Andrew Rose (Springer Netherlands) pp. 31–55. Mundell, R. (1963). Capital Mobility and Stabilization Policy under Fixed and Flexible Exchange Rates, Canadian Journal of Economic and Political Science, 29 (4), pp.475–485. Obstfeld, M. (2015). Trilemmas and tradeoffs: living with financial globalization, BIS Working Papers No 480. Obstfeld, M., Shambaugh, J., and Taylor, A. (2005). The Trilemma in History: Tradeoffs among Exchange Rates, Monetary Policies, and Capital Mobility, Review of Economics and Statistics, vol. 87 (3). Rey, H. (2014). International Channels of Transmission of Monetary Policy and the Mundellian Trilemma, London Business School, Paper presented at the 15th Jacques Polak Annual Research Conference Hosted by the International Monetary Fund, Washington, D.C., November 13–14. United States Congress (1913), Federal Reserve Act, Amended 1977, Section 2A. 4  BIS central bankers’ speeches
Looking beyond short‐term volatility, the real question is whether this architecture will be conducive to the efficient and stable allocation of capital over the long run; or whether, on the contrary, it will lead to an accumulation of imbalances and recurrent bouts of instability. An optimistic view can be found in the “Bretton Woods II” theory, which posits that the pattern of international capital flows results from a mutually beneficial equilibrium between two groups of countries. On the one hand, emerging economies follow an export‐led  BIS Review 127/2010  1  development strategy and seek to prevent appreciation of their real exchange rates by constant foreign exchange intervention (together with capital controls). As a consequence, they accept to accumulate increasing stocks of liquid assets denominated in dollars. On the other hand, the United States is happy to receive both reserve inflows to finance its deficits and cheap imports to fuel their demand for consumption goods. Such equilibrium is stable by virtue of the mutual benefits it brings to both groups. Moreover, the longer it lasts, the more impossible it is to change since both groups become mutually dependant through the stock of claims and debts they have reciprocally accumulated. This “financial balance of terror” is supposed to keep the system in place for a long period of time. A more recent, and pessimistic, explanation is provided by the “asset shortage” theory according to which the world has a shortage of liquid and riskless assets.

Mr. Meyer addresses the competitiveness of financial centres from a Swiss perspective Address by the Chairman of the Governing Board of the Swiss National Bank, Mr. Hans Meyer, at the International Bankers Club Luxembourg, held in Luxembourg on 23/3/98. Both Luxembourg and Switzerland are major financial centres in Europe. The performance and competitiveness of the financial services industry are thus of key economic and social importance to both countries. I should like to use this opportunity to say a few words on the subject from what may be a somewhat unusual perspective. The factors which determine the competitiveness of an industry are basically the same as those determining the success of the entire economy. In both cases, we are looking at a multitude of quite diverse factors with varying degrees of importance. Today, I would like to single out just three of them which I believe are of particular significance: economic stability, social equilibrium (i.e. political stability), and the human factor. Although each of these elements could be dealt with separately, they should ultimately be viewed in a broader context. Let’s start with economic stability. I define this as a state of balanced development across the economy as a whole, characterised by steady growth, a modest inflation rate and low unemployment. One of the main prerequisites for achieving such a state is the ability not only to create but to sustain an appropriate economic framework. This is primarily an objective for monetary policy, fiscal policy and competition policy.
Chart 3 looks at a set of four complexity proxies for each of the designated SIFIs in 2006, the year before the financial crisis broke: total balance sheet size; the notional value of their derivatives portfolio; the number of legal entities in the group; and their trading assets. They are shown by their country of incorporation. In 2006, the average SIFI had a balance sheet of $ trillion – roughly the same as the annual GDP of a small G7 country. The largest SIFI had a balance sheet totalling $ trillion. This is many multiplies of the largest non-financial firm. It also only covers onbalance sheet positions. Turning to off balance sheet positions, the derivatives portfolio of an average SIFI totalled $ trillion in notional terms in 2006. 8 For the largest SIFI, it was $ trillion. This, too, is many multiples of the largest non-financial firm’s position. These massive SIFI balance sheets were, in turn, spread across a very large array of distinct legal entities within each group. In 2006, the average SIFI had around 328 legal entities within the group. The largest had almost 900 distinct legal entities. Most of the largest global SIFIs had numbers of legal entities running to four figures. By comparison, the world’s largest non-financial firms had less than half this number of legal affiliates (Carmassi and Herring (2014)). A final complexity metric is the proportion of so-called trading assets.

The forecasts in the March Inflation Report indicate an average rate of increase in CPI inflation of approximately 1.0 per cent one year ahead and 2.0 per cent two years ahead. What inflationary risks can we see ahead? There is, of course, a risk that the higher energy prices will push up costs in other parts of the economy and thus have contagion effects. They can also affect inflation expectations and thereby wage trends. We have ahead of us wage bargaining rounds in the autumn, which will affect two million employees and will play an important role in future economic developments. The main risks for inflation below target level are connected with the uncertainty regarding international economic developments. In the euro area in particular there are problems that could lead to weaker economic developments than we are currently expecting to see. The risk spectrum for inflation is thus considered to be balanced on the whole. However, it is above all the geopolitical situation that is currently creating unease and uncertainty and poses a threat to the global economy which is very difficult to estimate. The uncertainty currently prevailing in the global economy makes it more difficult than usual to interpret various economic indicators and to predict future developments. Personally, I believe it quite possible that the consequences of the war will be both more prolonged and more costly for the global economy than is assumed in the main scenario of the Inflation Report.
MAS has funded 23 AIDA projects and published 5 requests-for-proposals on topics such as Quantum Computing and Explainable AI. To promote the responsible use of AI and data analytics, MAS and the industry cocreated the FEAT principles – for fairness, ethics, accountability, and transparency. Perhaps the most visible payoff for the investment in technology is in how well the industry has responded the COVID-19 crisis and been able to continue serving customers. Imagine if there was no retail electronic payment system or infrastructure for digital banking or buying insurance online or trading from home …. how would we have coped with circuit breakers and lockdowns? If the financial industry had not built up its digital capabilities, it would not have been able to continue operating without disruption, let alone grow by more than 5% during the first half of this year when the overall economy contracted by 6.7%. But we are still only about half-way along our journey to becoming a Smart Financial Centre. COVID-19 has shown that the world is changing in ways we may have never 3/5  BIS central bankers' speeches  imagined. The pace of digital transformation will only accelerate. Our work is not done yet. We will announce at the Singapore FinTech Festival in December more of our plans and initiatives for the next stage of our journey. But let me share with you here what we are willing to commit by way of funding. Of the $ million committed in 2015 for FSTI, we have utilised half the amount.

An ongoing active exchange of supervisory information will be established between us and the ECB concerning the other banks that will remain under BNB’s direct supervision. Countries like Hungary, Poland and especially the Czech Republic are markedly against joining the eurozone at this point. Is the currency board the main difference between them and Bulgaria which explains this discrepancy between policies, or are there other factors at play? 1/3  BIS central bankers' speeches  This is a political decision, above all. What’s positive in our case is that this decision is based on strategic and not conjunctural considerations. Practically, there isn’t a serious political factor in our country that does not support this decision. On the technical level, the monetary regime in Bulgaria allows for its implementation to happen quicker and seamlessly. You said in an interview for Market News this spring that the downturn in Europe could turn out to be temporary, but that would remain to be seen. How would you comment the developments in recent months? Uncertainty is on the rise and a lot of current data indicates a continuing economic downturn in the eurozone. This motivates the ECB to make decisions for an even more stimulating monetary policy. The technical details and the degree to which the ECB decided to step up its policy are a subject of debate, but the basic macroeconomic motivation behind these decisions is clear, in principle.
However, what seems more challenging to me is being able to reach the delicate balance between achieving our policy objectives and, at the same time, avoiding collateral damage, to the transmission of monetary policy and particularly to the stability of the financial system. It would probably be short-sighted to think that a CBDC would have no impact on the financial system. Of course it may replace cash to some extent, but it is difficult to believe that it will not attract a fraction of deposits as well. This means that a CBDC could have implications for financial stability, monetary policy, and the allocation of credit to the real economy. However, dispensing with its issuance in order to preserve the status quo is not an option either. Let me explain. We are in the middle of a  3/6  BIS - Central bankers' speeches  whirlwind of change, so the question should not be "what should we do to avoid change?" but rather, "what should we do to ensure the stability of the financial system, in the midst of change?". That said, CBDCs may come in different shapes and forms; therefore, adequate design and implementation are needed in order to minimise their impact. This is not a minor task and requires careful analysis. There are many interlinked design options and they all have to be considered, both individually and holistically, in order to ensure they are a perfect fit. This is, in fact, what the Eurosystem is currently doing in the context of the digital euro.

With due respect to our friends from the Pacific, I am very pleased to mention that these Games was a great success and an extraordinary achievement for our country and for all those who attended. I understand that some of you were very keen to hold this Seminar to coincide with the Games. But I guess the potential risk from a prudential supervisor’s view of losing participants during the two weeks of the Games may be considered critical and detrimental to achieving the objectives of our Seminar. That aside, the Central Bank of Samoa is very grateful for the opportunity to be co-hosting this years’ event with the Financial Stability Institute in Basel, Switzerland; the Pacific Financial Technical Assistance Centre in Suva; and the Association of Financial Supervisors of Pacific Countries. This Seminar is part of a continuing series of trainings which could only contribute towards enhancing and strengthening our capability as supervisors in the development of our economic and financial systems. This is indeed a great opportunity to learn and share issues of common interest, in particular, the potential risks and threats that could adversely affect the confidence in our banking and financial systems. As you all know, banks and non-bank financial institutions play a vital role in the economic development of any country. Therefore, there is strong public interest in maintaining the stability and financial soundness of these institutions. And recognizing such importance, central banks have been entrusted with the responsibility of not only licensing but supervising them as well.
As I have said on other occasions, I think that part of the solution lies in further improving the international safety net, so that countries have more efficient and less costly ways of ensuring resilience.12 To conclude, although the benefits from an open trade regime remain compelling, we must also recognize that such a regime imposes costs, and these need to be forcefully addressed. Focusing on these costs is necessary if globalization—including its financial dimensions—is to work for all of us. Thank you for your time. I would be happy to take some questions. 1 Mary Amiti, John Clark, Gerard Dages, Matthew Higgins, Emily Howard, and Tom Klitgaard assisted in preparing  these remarks. 2 Figures from UN World Investment Report, IMF World Economic Outlook Database, World Bank World  Development Indicators. 3 IMF World Economic Outlook, April 2017, in market exchange rate terms. 4 Figures from U.S. Bureau of Economic Analysis, IMF.

Opening remarks at OeNB monetary policy panel by Andrew Bailey Given at Oesterreichische Nationalbank, Annual Economic Conference, Vienna  Published on 23 May 2022  Remarks This is a time of very large economic shocks, and particularly very large external shocks, most recently from Russia’s invasion of Ukraine. I say that as someone who wholeheartedly supports the cause of Ukraine and the assistance we must give. We are in a period of rapidly rising energy, goods and some food prices. These are the most visible prices too. This is by far the main cause of high inflation, and is painful, particularly for those less well off. What can and should monetary policy do? There is a very important distinction between: whether monetary policy can anticipate and stop the effects on inflation of shocks; and, if not, whether it should respond when they happen? With shocks such as pandemics and wars, the answer to the first question is more likely to be “no”. But the answer to the second is very much “yes, monetary policymakers can and must take the actions needed to return inflation to target over a period that avoids unnecessary volatility in the economy”. It is domestic actions that have to get us back to price stability. For monetary policy, the choice of policy actions is influenced by the nature of the shock we are facing. In the UK we are facing a very big negative impact on real incomes caused by the rise in prices of things we import, notably energy.
Economic developments Monetary policy in Norway is oriented towards low and stable inflation, with annual consumer price inflation of close to 2.5 per cent over time. Norges Bank operates a flexible inflation targeting regime. Both variability in inflation and variability in output and employment are given weight in interest-rate setting. Inflation decelerated markedly from the end of the 1980s to the mid-1990s and has since been low and stable with considerably lower variability than earlier. Over the past 5-10 years, inflation has been fairly close to, but somewhat lower than the target. BIS Review 28/2007  1  The Norwegian economy is now growing strongly, following a pronounced upswing since summer 2003. Growth has been stronger than during the economic upturn in the mid-1990s. The continuous growth period of recent years is the longest ever recorded in the quarterly national accounts, which includes figures back to 1978. Average real growth rates for the past three years were well above 4 per cent. Since the economic recovery started, it has gradually broadened. Capacity utilisation is now high in most industries, and there are reports of limited capacity in most regions. The number of unfilled vacancies is rising, and labour shortages are reported in almost every occupational category. There are shortages of drivers, pre-school teachers, supervisors, engineers, carpenters, architects, auditors, accountants, IT personnel and health workers.

It is sometimes claimed in the media that there is a link between the Riksbank’s closure of its depots and the increase in cash transport robberies. I would doubt that claim. First and foremost, it must be remembered that approximately 85 per cent of the cash transports that are attacked are on their way to ATMs, and the Riksbank has never been involved in these transports. Only a very few transports to or from our offices have been the target of robberies. Furthermore, the large increase in the number of robberies took place while the Riksbank still had a network of cash depots throughout Sweden. One possible explanation for the increase in the number of cash transport robberies, which has been suggested by the Swedish National Council for Crime Prevention (BRÅ), is that criminality may to some extent have been transferred from robbing banks and post offices to robbing cash transports. Other possible explanations, according to BRÅ, are that cash transport robberies yield much larger amounts than bank and post office robberies, while increased security in post offices and banks may have discouraged prospective robbers. I think that we should ask the question of why Sweden has so many more cash transport robberies than other countries, not just other Nordic countries, but the majority of European countries. There have occasionally been suggestions put forward in the general debate that if one tried to reduce the use of cash in society, the number of transports to ATMs could be reduced.
The Shariah injunctions require that the Islamic financial transaction be supported by an underlying economic activity. This requires that the financial transaction must be accompanied by a genuine trade and business related activity. Based on this arrangement, interest-based transactions are prohibited. Islam encourages business and trade activities that generate a fair and legitimate profit. In Islamic finance, there is therefore always a close link between the financial and productive flows. This intrinsic principle contributes towards insulating the Islamic financial system from potential risks of financial stress resulting from excess leverage and speculative financial activities. A further fundamental principle of Islamic finance is the risk and profit sharing feature of Islamic financial transactions. This could involve an arrangement whereby the Islamic financial institution shares profit with the investor in a Mudarabah contract or in a Musyarakah contract, both parties share in the profit or loss. These arrangements involve an explicit sharing of the risks by the Islamic financial institution and the investor, thus requiring  1  Sources: Islamic Finance News, Islamic Financial Services Board & National Authorities. 2  The trend is now to have both "Shariah savvy financial practitioner" and "financial savvy Shariah Scholars". 2  BIS Review 23/2008  the Islamic financial institution to appropriately manage the risks associated with the transaction. It entails the appropriate due diligence and the integrating of the risks associated with the investment activity into the financial transaction. The real activity is thus expected to generate sufficient wealth to compensate for the risks.

6  To-date there is more than 10 retakaful companies providing retakaful capacity for both family and general takaful business. 7  United Nations Conference on Trade & Development's (UNCTAD) World Investment Report 2007. 8  Sources: JETRO from Ministry of Finance Balance of Payments Statistics and Bank of Japan foreign exchange rates. BIS Review 23/2008  5  markets would contribute towards further international financial integration and thus achieve a more efficient allocation of resources across borders. Conclusion Let me conclude my remarks. The increasing awareness and appreciation of the inherent strengths of Islamic finance and its tremendous potential for advancement have ignited interests amongst the global financial community to venture into this new sphere of finance. Taking advantage of the increasing role of Islamic finance in bringing together different parts of the world with surplus funds in search of investment opportunities, with those that have financing needs, will increase these mutually reinforcing prospects. We look forward to Japan's participation in this new financial evolution. Thank you. 6  BIS Review 23/2008