samchain/econo-pairs-v1 huggingface dataset:
To minimise uncertainty, some degree of coordination to remove these guarantee would be necessary. As governments in the developed economies inject huge sums of public funds to shore up banks, the instinct is to place demands on these banks to lend domestically. This may seem sensible individually. But collectively, this 'abandon-thy-neighbour' policy can trigger a big reduction of credit, and undermine economic recovery that eventually hurts the developed economies. Protectionist measures hurt emerging economies most, and they can trigger a backlash that sets the world back. We must resist such regression. Asia’s responses Let me now turn to the impact of the crisis on Asia, and responses to that. Asian economies will slow considerably. Those that are more highly dependent on external demand will contract more sharply than the rest. But unlike during the Asian Financial Crisis, the fundamentals in Asian financial systems and economies are generally sound. Banks are well-capitalised and have limited direct exposures to toxic assets. Corporate and household balance sheets are stronger. Current account positions are healthier and external liabilities manageable. The policy responses in several countries have been decisive and robust. Central banks in the region have appropriately eased monetary policy, and governments have put in place a range of fiscal and other measures to support lending and to cushion the impact of the global crisis. Nevertheless, considerable risks remain for Asian economies. The extent of demand contraction for Asia depends on how long and deep the recession is in the US and Europe. That remains an unknown.

Three points are worth mentioning on compliance: First, it is not the end, it is a means to an end; Second, it should be viewed within a broader context of a financial institution’s responsibilities to society; and Third, it should be approached in partnership with other key participants in the financial system. Compliance as a means to an end The past decade has been a turning point for compliance. Arising from major systemic failures of governance, regulators have since elevated the importance of compliance. For good reason, this has led to tighter regulations, greater scrutiny and stronger enforcement. The industry has in turn, invested heavily in their compliance function. It is estimated that some firms could spend up to 10% of their revenues on compliance within the next few years. This is by no means an insignificant amount. Yet, as we have seen over the recent years, this has not put a stop to money laundering and terrorism financing. A case in point is a major bank in the Asia Pacific region which is being investigated for more than 50,000 violations of money laundering and terrorism financing. Perhaps we need to take a step back and question if the industry has the right understanding of compliance. If the motivation for the increased compliance is merely to abide strictly by the rules and follow the book, thus avoiding scrutiny from regulators, this is misplaced.
Jon Nicolaisen: What should the future form of our money be? Speech by Mr Jon Nicolaisen, Deputy Governor of Norges Bank (Central Bank of Norway), at the Norwegian Academy of Science and Letters, Oslo, 25 April 2017. * * *  Origins of the central bank The Dutch financier Johan Palmstruch arrived in Stockholm in 1647. Some ten years later, he was granted permission to open a private bank, Stockholms Banco, where he combined two important innovations. The first of these, pioneered by Palmstruch, was to use customer deposits to fund lending. The second utilised Johannes Gutenberg’s invention, the printing press, to print the first European banknotes. Stockholms Banco was authorised to issue banknotes backed by the copper and silver coins in use at the time. Coins could be deposited at the bank in return for banknotes, and banknotes could be exchanged for copper and silver at the bank. The banknotes proved to be popular and were soon in circulation. Stockholm Banco also offered loans in the form of banknotes. For the Swedish king, Karl Gustav, this occurred at a convenient time. Wars were in progress that had to be financed, and a bank that would offer loans was like manna from heaven. King Karl Gustav made good use of the money. Sweden’s victory over Denmark-Norway in the 1658 Dano-Swedish War, leading to the permanent cession to Sweden of the strategically and historically important territory of Båhuslen in southeastern Norway, was thus at least partly the result of a financial innovation.

The digital revolution creates many opportunities for financial players, as for consumers: an increasing number of more accessible financial services, more complete customer satisfaction. But it also requires examining ways of adapting business models: diversifying services and adjusting their pricing, on the income side; anticipating changes in employment and skills, in the social dialogue. The Banque de France and the ACPR are mobilised to support innovation: creation of the “FinTech Forum” and a dedicated FinTech unit with the AMF; appointment of a “Chief Digital Officer". The Banque de France is also changing. Pursue efforts to combat money laundering and the financing of terrorism. Further progress will be made in 2017 with the full implementation of the Urvoas Act of June 2016 (including its anti-money laundering and financing of terrorism component) and the transposition of the 4th European Directive. I urge you to pay close attention to their effective implementation. With all these prospects, challenges and promises in mind, I renew to each and every one of you my best wishes for 2017. Thank you for your attention. 3/3  BIS central bankers' speeches
Historical experience has also rejected the Panglossian view that there exists such a thing as an orderly debt restructuring. While some restructurings have indeed been successful and can arguably be said to have occurred in an orderly fashion, they were often on a small scale and executed under specific circumstances. The most striking and oft-quoted case is Uruguay. However, more often than not, restructurings have been disorderly, harmful and fraught with difficulties. The average length of the negotiations is 2½ years6 and it can vary greatly. In some cases, negotiations have taken just a few months (for instance, Uruguay in 2003, Pakistan in 1999, Chile in 1990 and Romania in 1983); in other cases they have taken many years (for instance, Vietnam from 1982 until 1998, Jordan from 1989 to 1993, Peru from 1983 to 1997 and Argentina more recently). Empirical evidence also shows that private investors are likely to penalise a country which has a history of restructuring and to demand higher risk premia.7 When considering a euro area economy, the following points should be kept in mind. First, the domestic financial market would be severely affected by a default/restructuring of the public debt. Large losses would have to be accounted for, as no forbearance would be possible, and recapitalisation of the domestic banking system would require additional public money. Second, given the role of the state as implicit guarantor of many financial and economic transactions, the impact on the real wealth of the domestic population and on the economy would be substantial.

Renewed public comments about a possible “soft restructuring” or “reprofiling” of the Greek debt in April this year produced an immediate spike of the spreads on Greek bonds, with strong contagion effects to other euro area countries (see Chart 1). To sum up, private sector involvement, if pursued imprudently, i.e. automatically rather than as the last resort:   does not help save taxpayers’ money; indeed, it may cost them more money;    favours short-term speculation over long-term investment, which is certainly undesirable;    discourages and even delays any new investments in a country implementing an adjustment programme. 8  4  See FT, 24 April 2011. BIS central bankers’ speeches  Given that such a system – of preventive PSI – does not exist elsewhere in any other parts of the world, the euro area would be seen by investors as handicapping itself and it would feel the effects of discrimination. The euro area, in terms of both sovereign and private investments, would become less attractive. The financial system in particular would be highly exposed to sovereign restructuring. It would also put the euro area at odds with the rest of the international community. Given the damage that such a system would inflict on other investors and countries, the other shareholders may be discouraged from supporting IMF programmes in the euro area. This is how a good idea can turn into bad practice. Continuing to pursue it suggests strong masochistic tendencies. How should the problem be solved?
Over the coming year, the Global FX Committee and the broader international community will be working towards bringing the level of signup to the Code on the buy-side up towards that seen on the sell-side. Please join us in that campaign. 9  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  9

While this will open up new opportunities for enhanced efficiency and productivity gains in Asia, a better understanding of the risks inherent in networks will better prepare the regional economies to address these risks. This will be a shared responsibility within and among the regional economies. Closer regional cooperation, strategic alliances and smart partnerships will be important key responses for enhancing the prospects for higher growth and development in Asia. Thank you. 2  BIS Review 32/2006
The reason that the HKMC can offer rather high annuity rates is because it will place the entire annuity premium received from policyholders with the HKMA. The HKMA will then invest the money alongside with the Exchange Fund portfolios, half in the public markets (bonds and listed equities) and half in private markets (private equity and real estate). As the HKMA already has the investment capability and infrastructure for managing a portfolio as large as around $ trillion, it would be easy to take on the additional investment generated by the HKMC’s annuity premium. The HKMC has now received around 10,000 applications amounting to $ billion in subscription. We are processing the applications and the exercise is expected to be completed soon. By end-October or early November this year, the first annuitants will be receiving their first monthly annuity payments. 8. Let me do some quick maths here by using a married couple at the age of 65 who has joined both the Reverse Mortgage Programme and the Life Annuity Scheme. If the property they own is worth $ million, (which is the average value of the properties under the Programme), then they would get a monthly payment of $ plus the right of lifelong occupancy under the Reverse Mortgage Programme. If they each subscribe for $ million Life Annuity, then they will get another $ $ + $ per month. So they will receive $ per month.

Loans expanded for several successive years at annual growth rates ranging from 60 percent to 80 percent in real terms. The share of foreign currency-denominated loans to households grew more than five times, from 2.2 percent of GDP in December 2004 to 11.6 percent of GDP in 2008. Moreover, the share of foreign currency-denominated loans to the corporate sector picked up substantially (Chart 3). Overall, financial intermediation (loans to the private sector/GDP) increased from 16.6 percent in 2004 to 39.3 percent in 2008 (Chart 4). BIS Review 5/2010  7  Chart 3 Breakdown of foreign currency-denominated loans granted by financial institutions percent of GDP  14 loans to households  11.6  12  10.6  loans to non-financial corporations  9.2  10 8  7.1  7.5  7.1  6  9.8  4.7 3.3  4 2.2 2 0 2004  2005  2006  2007  2008  Source: National Bank of Romania Chart 4 Breakdown of loans to the private sector 45  percent of GDP  loans to non-financial corporations a.o.
Or is there “fiscal dominance” over the central bank, which is then forced to subordinate its own objectives to those of the fiscal authority? Because they naturally respond to the economic cycle, looking at the instruments of policy on their own (fiscal and monetary measures) doesn’t really help you that much in distinguishing one situation from the other. A better method might simply be to look directly at the institutional arrangements themselves (are monetary and fiscal policies determined by independent agencies? how is that independence safeguarded?). As this is ultimately a question of ends rather than means, a better measure still is the behaviour of objectives of policy. If inflation rises materially above its target, and if it tends to do so in particular when the public finances are under strain, that may be evidence of “fiscal dominance”. If, on the  1  See https://www.bankofengland.co.uk/research/bank-of-england-agenda-for-research. 2  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  2  other hand, easier monetary policy is necessary simply to stabilise inflation, and succeeds in doing so, it’s hard to see how it can qualify as “monetary finance”, no matter how the fiscal balance is behaving2. That’s not to say the fiscal position is wholly irrelevant because higher inflation may help – if only to a degree, and at a wider economic cost – in easing fiscal constraints. Very high levels of debt could therefore test those institutional arrangements.

3  Interested readers are referred to Moe, Solheim and Vale (2004), Norwegian Official Reports (1992), Wilse (1995), and Stortinget (1998). Steigum (2004) sets out the macroeconomic background and implications of the banking crisis. BIS Review 58/2003  1  During 1984 and 1985, the Norwegian banking system was deregulated. In this new environment, banks started to compete for market shares. We saw a huge increase in bank lending which, coupled with general optimism (oil!) and interest rates that were kept artificially low, created an economic boom. However, neither bank managers nor supervisors had much experience of banks operating in a competitive credit market, and did not pay sufficient attention to banks’ risk exposure. A sharp fall in prices for our main export commodities, oil and gas, and the need to consolidate the economy after the boom and bring down rampant inflation, led to a recession in the late 1980s. In short, deregulation, a lending boom, and an ensuing recession set the stage for increasing bank losses. The Norwegian banking crisis evolved in two stages: In the first stage from 1988 till 1990, several small and some medium banks failed. From 1990 - 1991, the crisis became systemic. The three largest commercial banks, accounting for half of the market for credit to the domestic non-financial sector, were in deep trouble. During the first stage of the crisis, the problems were mostly handled by the banks’ own guarantee funds.
Neither can we rule out an intensification of the recent global trends and a stronger than expected impulse from abroad, by either a steeper recovery of world activity and/or better commodity prices. Some of this seems to have permeated financial markets, where the prices of riskier assets have risen. Although it is still premature to validate such optimism, it is clear that the markets are in a better mood than last year, including local markets, which have even been outperforming many of their peers. On the domestic front, after several years of subdued growth, we cannot rule out that a more persistent phenomenon may be affecting the economy’s ability to grow, in which case spending plans of both public and private agents would need some revision. One area calling for special attention is the labor market. While acknowledging that it has gradually adjusted without significantly increasing unemployment in the past several years, it is possible that, after years of low growth companies wish to make more drastic changes in their payrolls, particularly if the expected growth recovery towards the end of the year stalls. In contrast, in a context where no macroeconomic imbalances are hindering growth, a scenario where an improved external outlook consolidates, plus the end of a cycle of mining investment adjustments and a rebound in sentiment, could lead to a more dynamic recovery than expected. All considered, the Board believes that the risk balance for both inflation and activity is unbiased. Summing up, inflation has evolved in line with December forecasts.

19  Figure 13 MPR and expectations (percent)  5  5  MPR  4  Financial asset prices in December Report (*)  3  4 EEE EOF  Financial asset prices in March Report (*)  2 14  15  16  17  18  3  2 19  (*) Built using interest rates in swap contracts up to 10 years. Source: Central Bank of Chile. 20
These range from uncertainty about litigation and restructuring costs in a number of banks to working through a stock of legacy assets, particularly in the countries most affected by the financial crisis. There is a subset of banks with elevated levels of non-performing loans (NPLs). However, these NPLs were identified during the Comprehensive Assessment, using for the first time a common definition, and have since been adequately provisioned for. Therefore, we are in a good position to bring down NPLs in an orderly manner over the next few years. For this purpose, the ECB’s supervisory arm is working closely with the relevant national authorities to ensure that our NPL policies are complemented by the necessary national measures. The state of the euro area recovery and the role of economic policies Against the background of downward risks emanating from global economic and financial developments, let me now turn to the economic situation in the euro area. The recovery is progressing at a moderate pace, supported mainly by our monetary policy measures and their favourable impact on financial conditions as well as the low price of energy. Investment remains weak, as heightened uncertainties regarding the global economy and broader geopolitical risks are weighing on investor sentiment. Moreover, the construction sector has so far not recovered. In order to make the euro area more resilient, contributions from all policy areas are needed. The ECB is ready to do its part.

The Great Financial Crisis is a good example: at that time, solid and well-anchored inflation expectations in the euro area contributed to counteract the strong deflationary forces affecting our economies. However, since then, market-based measures of inflation expectations in the euro area have been decreasing and this decline has been even more pronounced since the beginning of 2019. This fall in market expectations has raised some questions among central bank watchers on potential risks of deanchoring of inflation expectations and more generally on our ability to deliver our mandate of price stability. I.2. The need for better information on households expectations  Let me stress that market-based inflation expectations are not the only available measures to assess future risks of inflation. Professional forecasters or consensus forecast provide a significantly higher figure than the 5Y/5Y ILS, at around 1,7% rather than 1,2% to 1,3%, although all of them point out to a decrease of inflation expectations over time (Figure 1). Market-based measures have also some technical limitations: first, related to the liquidity of 2  financial markets, and second because they are affected by the evolution of the risk premium over time. Moreover, while financial market expectations provide information on future financing conditions, the evolution of prices and wages depends more deeply and directly on what household and firms expect regarding future growth and inflation. Consequently, existing surveys among firms and households can provide very useful and valuable information on expectations.
This meant that, for example, the differences in the risk premia applied to the various issuers of government debt disappeared. It was thought – and this was a widely held viewpoint – that membership of the Monetary Union would reduce the risk linked to current account deficits, because they could be financed within the Union in light of the free movement of capital. This approach, which would be proven to be mistaken with the crisis, led, among other things, to the risk associated with our economy’s growing external debt not being properly estimated. As regards demographic growth, the population rose by around 5,000,000 between 2000 and 2007, an unprecedented increase in such a short period since population series have existed in Spain, i.e. since the mid-18th century. Almost 90% of this population increase was attributable to net immigrant inflows, most of whom adults, which fuelled the growth of the real estate sector by means of both a permanent increase in the demand for housing and, on the supply side, by providing the labour that helped the construction sector expand.

The first half of 2012 saw a stepping up of so-called “redenomination” risk, which was a euphemism for the doubts over certain countries, Spain among them, remaining in the euro area and, indeed, over the survival of the single currency. In March, a second bail-out was approved for Greece and, in May, with the inconclusive Greek elections, rumours were again unleashed about the country exiting the Monetary Union. In parallel, there was a fresh bout of tension centred on Spain and on Italy, where two-year risk premia relative to the German Bund climbed to over 700 and 500 basis points, respectively. Fears intensified in Spain over the impact of the double-dip recession on the position of credit institutions and on the feedback loop between sovereign and banking risk. Funding conditions on the wholesale markets once again tightened and net fund outflows to the external sector stepped up, totalling € billion in cumulative 12-month terms, 29% of GDP. In mid-2012, Spain was facing what was practically a collapse in external funding, which it was able to offset with a substantial increase in Eurosystem funding, which came to account for € billion in August 2012, 34% of the liquidity injected by the Eurosystem into banks across the whole euro area.