samchain/econo-pairs-v1 huggingface dataset:
BIS Review 161/2008  3  The use of techniques and technology It has been fashionable for scientists to make use of scientific techniques and technology to facilitate the decision making process, when undertaking scientific inquiries. Extreme care should be exercised by scientists in this instance. Every technique has its own methodology and limitations and the scientist should be fully aware of same when such techniques are used. Inappropriate use of the techniques or wrong conclusions made on the basis of the results derived amount to misuse of science by the researchers. It also paves way for crafty individuals to use the results to their advantage and gullible individuals to get victimised. The use of econometrics has been one of the techniques employed by scientists to prove or disprove their hypotheses. This has also been one of the sources of misuse of science, either because wrong calculations are made or wrong conclusions are arrived at, due to the failure of the researcher to analyse the error term appropriately. Wikipedia, the cyberencyclopaedia, is full of the instances of such misuse of econometric methods in research. It is noteworthy to refer to two studies done by Deirdre N McCloskey and Stephen T Ziliak of the University of Iowa on the status of econometric studies in research articles published in the reputed journal American Economic Review in 1980s. They have found fault with authors for not analysing the error term properly and using the statistical term “significance” inappropriately.

These include the FXCs in Mexico, South Africa, Scandinavia and Switzerland. Through the membership expansion, the Code will become more global as these FXCs promote the adoption of the Code within their jurisdictions. 7 Second, on embedding the Code and integrating it into the FX market. If done well, we should see market behaviours reflect the good practices set out in the Code. We have seen that the process of issuing the Statements has prompted internal reviews within many firms, where market participants considered how the Code could apply to their business. In issuing our Statement, we have done the same in MAS. It has been a helpful and meaningful exercise to benchmark our internal processes against these good practices. We have also seen a number of training tools being developed by market participants to support learning, and these have enhanced the ecosystem of good practices within the FX market. Another key area where we think the Code has enhanced market behaviour is that a number of market participants have updated client disclosures to provide greater transparency, and to incorporate the principles within the Code. 8 Third, on evolution of the Code. When the Code was launched, the GFXC has stated that the Code will need to evolve over time to promote a robust, liquid and transparent FX market. The Code has become the platform or reference point for discussing issues relating to the FX market. This is a good outcome where emerging issues are identified, debated and addressed within the Code.
And today there are additional incentives for life insurers to offer new products that break away from the dual cash-liquidity guarantee, due to the lesser Solvency II capital requirements. And this brings me to the issue of regulation. Here too, insurers have an essential role to play, i n preparing the review of the Solvency II Directive’s new regulatory framework. The directive came into force almost two years ago now and you have implemented it with a great deal of professionalism. In many respects, Solvency II represents a very significant step forward for the insurance sector. But this does not mean that it’s perfect: we must analyse its impacts closely, particularly its effects on investment behaviour and the financing of the economy, in order to propose the adjustments that prove necessary. Progress has already been made on the financing of infrastructure projects and businesses, thanks to two amendments that came into effect in April 2016 and September 2017, respectively, which adapted the calibration of capital requirements. More generally though, the reviews of the standard formula and long-term guarantee package measures planned for 2018 and 2020, respectively, are important opportunities to make essential improvements. The work is already underway, and the more you 2/3  BIS central bankers' speeches  actively participate, alongside your European colleagues, the more our chances of success will be enhanced. III.

  systemic risk should be contained via the creation of resolution mechanisms for financial institutions as well as promoting more resilient market infrastructures, such as CCPs for clearing and settlement of derivatives products. The financial crisis also gives us the opportunity to think about Central Banks fundamental task: the making of monetary policy. Amongst the many questions currently asked in academic and policy making circles I will select four: 1/ – the mandate: recent proposals have been made to assign monetary policy additional financial stability objectives, possibly by amending Central Banks mandates. I see those proposals as misguided. First, adding a financial stability objective at the same level as price stability could weaken the latter. Second, if price stability is not a sufficient condition to ensure financial stability, it is certainly a necessary one. And, finally, current mandates seem absolutely appropriate to allow Central Banks to fulfil all their responsibilities. Looking, more specifically at the Eurosystem we have a “hierarchical” mandate, giving clear and unambiguous priority to achieving price stability; and, once this objective has been met, it allows us to pursue other goals. Financial stability easily fits into the set of those “secondary” objectives. This clear priority was understood by the markets. It was most apparent in our decision to raise policy rates in July 2008. It was essential to give us the necessary leeway to act decisively later – when the financial system was in danger of paralysis – without compromising our credibility.
By and large, they are not currently configured as centres for life-long learning. And nor, in the main, are they institutions providing a balanced educational offering of cognitive, technical and social skills. To meet the needs of the future world of work, that might need to change. The importance of a broad-based, Newman-style, education is likely to be greater than ever. This might criss-cross disciplinary boundaries, as one way of increasing people’s ability to make giant logical leaps. Those skills will be social and technical every bit as much as cognitive, with head, hands and hearts sharing equal billing. Put this way, the future university may need to be a very different creature than in the past. It may need to cater for multiple entry points along the age distribution, rather than focussing on the young. And it may need to cater for multiple entry points along the skills spectrum, rather than focussing on the cognitive. It would, in short, need to be plural rather than singular – a “multiversity”, rather than a university. (b) Intellectual Capital  Multiversities are about spreading future skills across the workforce. Another educational challenge is how to spread future technologies across companies. This is crucial if ideas and innovations are to become GPTs, boosting productivity, pay and living standards. At present, evidence on the diffusion of new technologies across firms paints a rather mixed picture. To understand why, it is useful to recognise that two forces are at work when a new idea is diffusing through the economy.

The Bank of England’s Independent Evaluation Office’s review is a valuable contribution to that learning, and we at the Bank have welcomed its recommendations. They will help guide us in our response as we continue the journey to whatever the future normal for policy looks like and the role of the Bank’s balance sheet within that. 16  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  16  The Condolence Book set up by the University of Birmingham stands as a wonderful memorial to Peter. There you can read tributes from Peter’s wife Jayne Ivimey, from his brother Michael and his cousin Lindy. There are many entries from colleagues and students at the University of Birmingham, from Oxford University and from the many other academic institutions Peter was associated with. There are also entries from many friends and colleagues, including from staff at the Bank of England. Peter had a strong association with the Bank of England for several decades, continuing right up to his death in March 2020. Peter was Director of the Bank’s Centre for Central Banking Studies from 2000 to 2008. When researching for this lecture I came across the quote he gave when his appointment to the CCBS was announced on 16 February 2000, twenty one years ago. It sums up the warmth and generosity of his approach to learning and depth and internationalism of his outlook and so I have shared it on the screen (Figure 10). “All Central Banks have so much to learn from each other.
23  Feldstein M. “Monetary Policy in a Changing International Environment: The Role of Capital Flows”, NBER Working Paper 11856, December 2005. 24  Friedman T. “The World is Flat. A Brief History of XXI Century”, Farrar, Straus and Giroux, New York, 2005. 25  According to the World Economic Outlook published by the IMF in September 2005, the forecasted US current account deficit will amount to USD 759 billion in 2005 and will increase to USD 805 billion in 2006. Both values correspond to 6.1% of the forecasted GDP. Some forecasts by investments banks, however, indicate an increase in the forecasted current account deficit to 6.5% of the GDP in 2005 and to 7-8% of the GDP in 2006 and 2007. 26  An extensive discussion of the real property market can be found in A. Ahearne et al. „House Prices and Monetary Policy: A Cross Country Study”, Fed Board of Governors, International Finance Discussion Papers, September 2005. BIS Review 60/2006  11  – the country most abundant in foreign reserves, whose reserves amounted to USD 847 billion in December 2005. The Chinese foreign reserves are expected to exceed USD 1 trillion (a thousand billion) in 2006. 27 n the years 2004-2005, the current account deficit in the US was in ever-greater part financed from purchases of American bonds by public institutions that managed foreign reserves in oilexporting countries. Chart 10: The US current account deficit and the geographic structure of the deficit-financing capital inflow (current account surplus), 1980-2005.

USD billion  800 600  Other Asian countires  400  Euro area  200 USA  0 -200  Japan  -400 China  -600 -800  OPEC countries  -1 000 1980  1983  1986  1989  1992  1995  1998  2001  2004  Source: MFW, World Economic Outlook. The situation where the world’s largest economy and at the same time the issuer of the global reserve currency has such a large savings deficit financed in such an unusual way has triggered a hot economic debate on the two following issues. Firstly, attempts are being made to explain how global imbalances have come into being. Secondly, both academic economists and strategists with investment banks are trying to assess the possible scenarios of further developments. Are global imbalances a regular phenomenon in the global economy and can they increase further without any harm to the outlook for the long-term global growth? Can a radical adjustment of these imbalances occur – and if yes, what will be the mechanism of such an adjustment and what will its consequences for the global growth be? Let us begin with the presentation of the main hypotheses that explain the phenomenon of global imbalances. In 2003, three economists presented a hypothesis that an informal Bretton Woods regime had been reactivated.
Operational risk has become a much greater concern for CCP supervisors and regulators in recent years and we increasingly need to see higher standards of resilience in the face of operational and cyber risk. Recovery and resolution regimes for CCPs need to take more account of threats to CCPs from this direction. Whether this should mean more loss absorbing capital at CCPs, access to member resources in the event of non-default losses or some combination of the two is a matter of ongoing discussion. But given the role CCPs play in the financial system, we need to think more about how we would resolve a CCP that had suffered a major operational failure, without entry into insolvency. Similar issues arise in the context of the resolution of systemically important banks. Having published guidance on resolution strategies for CCPs in 2017, the Financial Stability Board’s FMI Cross Border Crisis Management group is now focused on two issues that remained outstanding; namely the adequacy of financial resources for resolution and the treatment of equity in resolution. Bank resolution  The Lehman Brothers episode with which I started today exposed brutally that insolvency is not an option for large cross-border banks that perform critical economic functions. One of the main objectives of the post crisis reforms has been to put in place bank resolution regimes that enable the authorities to stabilize a failing bank by bailing in its debt holders to restore solvency and regulatory capital.

Svante Öberg: Productivity and monetary policy Speech by Mr Svante Öberg, Deputy Governor of the Sveriges Riksbank, at a meeting at Handelsbanken, Stockholm, 7 June 2007. *  *  *  Let me begin by thanking you for the invitation to come here and speak to you! The rapid increase in productivity is the most important explanation as to why inflation has been low in recent years. The low inflation has in turn given us at the Riksbank the possibility to keep the interest rate at a low level. But productivity will probably show a slower increase in the future. Combined with higher wage increases, this indicates higher inflationary pressures and thereby higher interest rates over the coming years. In the light of this I shall devote today’s presentation to productivity and monetary policy. My speech will have the following structure: I shall begin with an introduction briefly describing how productivity has developed in historical terms. Then I shall move on to three important issues: The causes behind the strong productivity growth, developments in productivity over the coming years and the significance of productivity for monetary policy. I would like to make it clear from the start that I will not be talking about current monetary policy. I would also like to make it clear that I will today give my own views on productivity and its significance, which are not necessarily the views of the Riksbank.
1/3  First, the greater role of hedge funds and other unregulated entities in our financial system today requires more attention by the major banks and investment banks to counterparty risk management. The greater diversity of participants in risk intermediation is probably on balance a positive thing for our financial system. Hedge funds, private equity funds and other kinds of investment vehicles help to disperse risk and add liquidity. Their greater prominence in our markets, however, means that banks and investment banks face a heightened challenge in managing the risks involved in their exposure to these firms and in understanding the firms’ ability to weather conditions of stress and their impact on market conditions in those circumstances. The degree of the systemic risk presented by the growth in the leveraged, unregulated financial institutions depends in part on how well the major dealers manage these challenges. Market practice in these areas has improved significantly since 1998, but progress has been uneven across the dealer community, and competitive pressures have caused some erosion in counterparty discipline relative to the risks in exposures.

Across all these areas, these judgments have to be translated into appropriate limits, an appropriate capital cushion above the regulatory minimum and a robust liquidity management strategy. These thresholds need to be calibrated to withstand more adverse conditions than we’ve seen in the recent past. The major institutions seem in general to be managed so that they are in a stronger position to withstand the shocks of the nature and magnitude of the last few decades of experience. The apparent increase in the strength and resilience of the U.S. financial system has contributed significantly to the improvement in the overall performance of the U.S. economy of the past 20 years. As the challenges of risk management become more demanding, it is important that supervisors and those charged with managing the major financial institutions make the investments necessary to stay abreast of the changing frontier of risk management challenges and a potentially more uncertain future. Thank you. 3/3
Such stability in the nominal exchange rate vis-à-vis the euro over the two-year period in ERM II would indicate that the economy has converged well and is flexible enough to absorb economic shocks without having to change the exchange rate. The signalling effects stem from the multilateral nature of ERM II. The joint announcement of a new member's central parity rate by all the parties involved sends a message to the markets that these various entities collectively consider that rate to be an appropriate exchange rate for the economy. Will participation in ERM II affect the status of the lira during this phase? During ERM II, the Central Bank will continue to play its current active role in the areas of monetary and exchange rate policy. The lira will continue to be the legal tender currency of Malta until the euro is adopted. Until then, and while Malta participates in ERM II, the euro will, to all intents and purposes, be treated as any other foreign currency. How will the central parity rate in ERM II be determined and what other decisions need to be taken with respect to Malta's participation in ERM II? The central parity rate will be jointly agreed by euro area ministers, known as the Eurogroup, Malta's Minister of Finance and the Governor of the Central Bank of Malta.

It is crucial for long-term financial stability that those who make long-run debt commitments are fully aware of this reality and that they plan accordingly. What about inflation risk? Personally, I do not share the view that the current period of central bank activism will be followed by a resurgence of inflation. First, contrary to common assertions, persistent - as opposed to unanticipated - inflation is limited in its capacity to reduce sovereign debt burdens. Second, the low levels of inflation we are currently experiencing are the result of improved monetary policy, combined with a general acknowledgement that inflation does not buy durable economic performance. Neither of these factors are affected by recent events. We can therefore anticipate that, with current or enhanced levels of understanding of monetary mechanisms, and central bankers’ continued preference for price stability, future inflation levels will resemble those of the last 20 years. References Bernanke, Ben S. 2005. The Global Savings Glut and the U.S. Current Account Deficit. Remarks at the Sandridge Lecture, Virginia Association of Economists, Richmond, Virginia. 10 March 2005. Borio, C., and P. Disyatat. 2011. “Global imbalances and the financial crisis: link or no link?” Bank of International Settlements. Working Paper No. 346. May 2011. Gagnon, J., Raskin, M., Remache, J. and Sack, B. 2010. “Large-scale asset purchases by the Federal Reserve: did they work?” Federal Reserve Bank of New York Staff Report No. 441. IMF. 2005. Building Institutions. World Economic Outlook (International Monetary Fund). September 2005. Joyce, Michael, Ana Lasaosa, Ibrahim Stevens and Matthew Tong. 2010.
Prasarn Trairatvorakul: Navigating through volatility with long-term focus Speech by Dr Prasarn Trairatvorakul, Governor of the Bank of Thailand, at the Association of International Banks (AIB) Dinner Speaker Series, Bangkok, 29 July 2013. *  *  *  Excellencies, distinguished guests, ladies and gentlemen, I would like to thank the Association of International Banks for inviting me to give a talk this evening. It is my honor and pleasure to be here for the prominent institution that has its presence in Thailand since 1996. The association’s work and efforts have contributed significantly towards the strength of the Thai banking system as well as economic prosperity here in this country. For this special evening, I would like to share with you my views on the recent economic and financial challenges, as well as the Bank of Thailand’s role in safeguarding economic and financial stability. Navigating through volatility Over the past few years, we have gone through many economic surprises. Last year alone the Thai economy had to face several challenges, both inside and outside Thailand – recovering from the devastating floods and coping with fragile global economy. And just a few months ago we only just started talking about a pick-up in global growth, driven mainly by robust demand in emerging markets. Today, circumstances have changed, and we are facing with unexpected slowdown in emerging markets as well as the prospect of Fed QE tapering. As far as global economic environment is concerned, I think we are going to see a lot more surprises.

Growth in the first quarter has been subdued as domestic spending, both private consumption and investment is weaker-than-expected. Part of this pullback may have been a natural reversion to a more normal pace of growth after an unusually strong expansion last  BIS central bankers’ speeches  1  year. At the same time, on the external side, a drag on the overall Thailand’s trading partners’ growth continues to weigh on Thai exports. Going forward, however, many of the supporting factors remain in place. High level of employment and strong private sector confidence should provide an enabling environment for growth. Fiscal stimulus related to large-scale infrastructure investment should also begin to phase in from the latter part of this year. This would potentially generate a positive crowding-in effects on private spending. For this, I would expect the economy to return to its normal path in the third and fourth quarter of this year. Apart from slower growth, a potential threat to financial stability has increased, stemming from development in household indebtedness. Currently, household debt is rising to over 70 percent of GDP. International evidence suggests that a prolonged period of rapid credit growth could lead to a build-up of financial imbalances, worsen households’ debt servicing ability and loan quality, as well as sow a seed for asset price bubbles. The need for long-term focus Ladies and gentlemen, Having said all of the above, I may seem to paint the picture that the Thai economy is slowing down recently, largely as a result of weaker global growth.