samchain/econo-pairs-v1 huggingface dataset:
At the same time, we have seen the risks in this development in no uncertain terms. The flows in the financial system have increased substantially while the system has become increasingly complex and difficult to survey. The mutual dependence of the various markets has increased. This means that crises can more quickly and more forcefully hit an increasing number of economies at the same time. The important thing now is to find the right tools for managing these new risks; to find instruments for a better-balanced development. We need a better insight into the build-up of global risks. This requires increased cooperation between public authorities around the world. It requires greater harmonisation of regulations and supervision. It requires a better readiness to manage cross-border crises. And to find the means to counteract the build-up of large imbalances we must begin to think along new lines. At present the functioning of the financial system is being maintained with the aid of the measures implemented by public authorities. One sign that the crisis is no longer as acute is that the TED spreads have fallen in Sweden, as well as the United States and the euro area. These spreads are now back to around the same levels that prevailed immediately prior to the worsening of the crisis in autumn 2008. But the financial markets are still functioning much less efficiently than normal. It is also still difficult for companies to finance themselves in the capital market.

The banks created special intermediaries off their balance sheets to hold and structure the securitised credits. This made it possible for the banks to increase leverage both on and off the balance sheet. However, explicit and implicit guarantees from the banks to these special companies meant in practice that the risks led directly back to the banks' balance sheets. The result of all these new instruments and artificial intermediaries was a motley and almost impenetrable structure. A wide range of asset types with idiosyncrasies in pricing arose. This also made them more difficult to value. Moreover, the complicated links between the banks and their special investment vehicles made it difficult to see exactly what the banks' exposures were. Eventually, no one knew where the risks were. The increasing amount of credit not only made investors highly indebted in relation to their equity, many banks also did not really have enough capital in relation to the risks they took. When economic activity began to decline in the USA and prices fell on the US housing market, many institutions suffered major losses. Above all, however, a great deal of uncertainty arose. It proved to be simply impossible to know with any certainty who was exposed to "toxic assets", that is assets that risked losing value as a result of major credit losses. The realisation that many institutions could be more in debt than appeared to be the case on their balance sheets fuelled this uncertainty.
2/5  BIS central bankers' speeches  However, the evolution of finance must also be managed appropriately to avoid displacement and exclusion. This would include underserved groups and segments that are currently deemed too ‘risky’ by traditional risk metrics. Advancements of any sort always come with trade-offs. For one, with the rapid progress of genetic sciences, it is only a matter of time before chronic diseases such as cancer and diabetes can be predicted even before birth, thereby potentially denying affected individuals of insurance coverage. Automation and artificial intelligence may also result in the displacement of certain segments of the workforce or some segments of society being denied medical protection. Finance, when used properly is an enabling tool. But if abused, it can be a destructive tool with devastating consequences. Finance without ethical considerations will magnify the negative aspects and lead to lasting consequences as the global financial crisis demonstrated. Technological progress would mean excesses can be magnified even further, spreading the risks to a wider segment of the society. Regulators, therefore, stand at the nexus between magnifying the benefits of access to finance and managing the excesses of finance. There are moral and ethical considerations that regulators and policymakers will have to confront as we go forward. Four possible future scenarios Let us conceptualise these themes into four scenarios, an approach that could provide a peek into what is in store, as we visualise the future. The first scenario is “Tech-Savvy Incumbents” a.

In the case of Asia, the sharp devaluation and swift recovery in exports led the Asian economies to become addicted to large volume of export at low prices. And, in the case of Thailand, with little incentive to invest in research and development to raise the products’ value and enhance human capital, the average growth of labor productivity3 had trended down from the 1990s to 2000s. Ladies and gentlemen, This brings me to my third part on the lessons from the Asian financial crisis. I would like to offer three reflections that may not necessarily pertain to Europe but may provide food for thought for policymakers. First, conventional policy prescriptions may not be appropriate for unusual circumstances and there is no one-size-fits-all solution. Asia was a case in point of ill-timed austerity measures. Public sector debt in Thailand then was less than 15% of GDP; yet the policy prescription for Thailand was to tighten fiscal policy and maintain tight monetary policy, resulting in (interbank) interest rate rising from 10% at the beginning of 1997 to over 20% at the end of 1997. With large private external debt beyond the ability of the country to service, a way out should have been debt restructuring with international creditors to give the country a breathing space and avoid the painful shock from the sharp reversal in capital.
But the general sentiment is not one which would be entirely out of place today. It is not difficult to see why. The profile of central banks may never have been higher than today. The responsibilities of central banks may never have been greater than today. And the actions taken by central banks may never have been larger or as far-reaching as today. It is no coincidence that they have recently been described, variously and colourfully, as “masters of the universe” and “the only game in town”. 3  At the same time, central banks have faced mounting criticism, and some mistrust, of their actions, responsibilities and influence, at least in some quarters. Some have suggested tweaking, perhaps even 4  reversing, central banks’ degree of operational independence over monetary policy. Others have suggested constraining, perhaps even removing, central banks’ degree of discretion over monetary policy. 5  This story has all the hallmarks of a Charles Dickens novel. Depending on who you follow on Twitter, for central banks it is the best of times and the worst of times; it is an age of wisdom and an age of foolishness; it is an epoch of belief and an epoch of incredulity. A happy ending to this story is by no means assured. These views may be polarised, perhaps even caricatured. But they matter. Trust is the lifeblood of all things monetary and financial, including central banks.

Yves Mersch: Challenges for completing Europe’s economic and monetary union Speech by Mr Yves Mersch, Member of the Executive Board of the European Central Bank, at the MNI Connect event, Singapore, 13 October 2015. *  *  *  Over the past few months, Europe has faced two exceptional challenges. First, there was the new adjustment programme for Greece. And second, there has been the large influx of refugees, a challenge that is very far from the competences of the European Central Bank (ECB). Though very different in nature, these two events offer a common lesson for future challenges that we will collectively face: that Europe is strong only when it acts on the basis of solidarity and cooperation. I would like to talk about two further topics of importance today: first, the ECB’s assessment of recent economic developments and their implications for our monetary policy stance; and second, the necessity for completing Europe’s economic and monetary union. Over the summer, industrial production and other indicators of economic activity in the euro area have shown signs of resilience. Yet at the same time, the macroeconomic environment has become more challenging. The ECB’s latest macroeconomic projections indicate a weaker economic recovery and a slower increase in inflation rates than was expected earlier in the year. Inflation will remain close to zero in the very near term, before rising again towards the end of the year.
MONETARY POLICY REPORT PRESENTATION BEFORE THE FINANCE COMMISSION OF THE HONORABLE SENATE OF THE REPUBLIC  Mario Marcel Governor Central Bank of Chile 9 December 2020    The December 2020 Monetary Policy Report can be visited at http://www.bcentral.cl. 0  I. Introduction  Mr President of the Senate’s Finance Commission, Senator Jorge Pizarro, Senators members of this Commission; ladies and gentlemen, I am grateful for your invitation to present the vision of the Board of the Central Bank of Chile (CBC) on recent macroeconomic developments, their prospects, and implications for monetary policy. This vision is contained in detail in the December 2020 Monetary Policy Report, published this morning. It also provides the background for the Board’s decision at last Monday’s Monetary Policy Meeting. As has been seen since the start of this year, the local and international economic scenario continues to be shaped by the evolution of the Covid-19 pandemic, the measures that have been adopted to control it, and how these have affected the mobility of people and the functioning of the economy. In our country, economic activity has recovered part of the steep drop it suffered between March and May of this year. This has been accompanied by a drop in the number of cases—which has resulted in fewer mobility constraints than in midyear—, individuals and businesses adjusting to a new form of operation because of the pandemic, and the boost provided by monetary and fiscal policy, along with other support measures for households.

Meanwhile, if a vaccine is available sooner, herd immunity could be achieved more quickly in the country, lifting some supply-side restrictions and leading to a faster and more robust recovery in expectations and demand. To the extent that the recovery of supply is the dominant factor in these scenarios, the monetary policy trajectory may not be significantly altered from the central scenario. But if there is a scenario in which weak investment is more persistent, either because of uncertainty and/or because of the sequels of the pandemic, the reduced demand could ease the medium-term pressures on inflation. This would result the MPR being held at its technical minimum for longer, and the possibility of deepening the use of unconventional measures. The economy is going through a complex recovery process that faces the challenges of both the pandemic and the political climate following the social crisis that broke out just over a year ago. The central scenario assumes that the latter will follow the institutional path approved by Congress. However, if new political and social tensions materialize that call this path into question, the negative impact on the economy may go beyond what the CBC may be able to neutralize with its traditional and unconventional toolkit. Let us bear in mind that the government, businesses, households, and financial institutions have withstood the pressures of the last 15 months by making extensive use of the buffers accumulated in previous years, which has deteriorated their equity position.
But the severity of the crisis increased dramatically following the failure of Lehman Brothers in the autumn of 2008. Confidence in the very essence of banking – as well as in individual financial institutions – was shaken to its core and the most severe banking crisis for almost a century was triggered. As we now know, this led to a deep and highly synchronised global recession. Output in virtually every corner of the world fell sharply. Global trade flows contracted by a staggering 15% in the two quarters following the failure of Lehmans. Over the same period, output at home is estimated to have fallen by 4 1/4% – the largest fall in UK GDP over a two-quarter period since quarterly records began. The speed and severity of the downturn cannot be explained solely by the tightening in credit conditions. The impact of the banking crisis was greatly amplified by the accompanying collapse in business and household confidence. Firms’ concerns about their ability to access the working capital needed to run their businesses was compounded by the bleak and uncertain prospects for demand. In response, production was slashed and business spending was severely curtailed. Stock levels were run down at an unprecedented pace, as companies met demand from existing inventories and economised on working capital. Faced with growing spare capacity there was little incentive for businesses to invest in new plant and machinery, and capital expenditure contracted by almost 20% in the first six months of 2009 alone.

Spencer Dale: 2009 – a review of the economic year Remarks by Mr Spencer Dale, Executive Director and Chief Economist of the Bank of England, at the Chairman’s Annual Breakfast, Essex Institute of Directors, Billericay, 2 December 2009. *  *  *  I would like to thank Rohan Churm, Julia Giese and Chris Young for their considerable help in preparing these remarks. The views expressed are my own and do not necessarily reflect those of other members of the Monetary Policy Committee. Introduction Thank you for the invitation to speak to you this morning. On the occasion of the Chairman’s Annual breakfast, I thought it would be fitting to look back over the events of the past year. A year which started with our country – together with much of the rest of the world – in economic freefall. A year in which many firms and families suffered significant hardship, as output fell markedly and unemployment rose. But a year which is ending with signs that the economy is stabilising and has turned a corner on the road to recovery. Financial crisis and collapse in confidence The financial crisis obviously predates the beginning of this year. The first signs of the instability can be traced back to at least the summer of 2007, when the emerging sub-prime mortgage crisis in the United States and the resulting pressure on banks’ balance sheets around the world led to a sharp tightening in the availability of credit.
Douglass North’s definition is a good starting point: “humanly devised constraints that structure political, economic and social interactions”. 24  So defined, institutions are social infrastructure. They include formal or  legal institutions, like Parliaments, judiciaries, central banks, social safety nets and schools. But they also include less formal associations and groups, such as universities, trade unions, guilds and charities. As for their genesis, history suggests institutions emerge for a variety of reasons. Sometimes they have been a direct response to political upheaval. Some of the largest transformations in political institutions have th  resulted from revolutions: in the UK, after the Glorious Revolution of the 17 century, in France after the th  th  French Revolution of the 18 century, in the United States after the Civil War of the 19 century. At other times, institutions have emerged in response to the pressing financial or social needs of citizens. Often, those times of most pressing financial and social need have coincided with sharp changes in the economic environment which have left large swathes of society worse-off. And often, technological disruption and displacement have been the root cause of these sharp changes in the economic environment. The three Industrial Revolutions provide a useful set of case studies. Each caused technological disruption and significant job displacement. Each had, as a result, a wrenching and lasting impact on the job and income prospects of large swathes of society. Each caused a significant and sustained period of hardship for many.

Balance of payments and tourism Our balance of payments performance in the past three years has been very favourable: from running a heavy deficit, with a negative current account balance up to 10% of GDP in 2007, we are now in a different position, with few, but brief precedents in Spanish economic history, marked by a current account surplus against a background of significant GDP growth and job creation. In the first nine months of this year (the figures for September were published today), the Spanish economy’s net lending (i.e. the cumulative surplus on the current account balance and the capital account balance) stood at € billion, compared with a surplus of € billion in the same period of 2014; that is to say, it has more than doubled thanks to the reduction in net foreign interest payments. The widening of the surplus on capital account and the increase in the positive balance on goods and services, as a result of the improvement in the energy balance and, to a lesser extent, in the surplus on non-tourist services, were also a contributing factor. 2  BIS central bankers’ speeches  The tourism balance has contributed positively to the improvement in the current account balance. In the January-September period, the tourism surplus was € billion, a very similar figure to that recorded in the same period in 2014.
Wage costs have great significance As total wage costs comprise almost 70 per cent of the total value added in the economy, developments in wage costs have decisive significance for the development of costs and prices. Making an assessment of future developments in wage costs is therefore a natural and central element in the Riksbank's analysis of inflation prospects. If there is an overly rapid increase in wage costs, companies may be forced to raise their prices significantly and this would result in inflation exceeding the target level. This would require tightening monetary policy, i.e. raising the repo rate. Although this would bring inflation back to the target level, it would be at the cost of an increase in unemployment. In the long term, however, developments in unemployment are essentially dependent on how well the labour market and wage formation function. Monetary policy has affected the wage formation process; the uncertainty over future price developments has declined thanks to inflation targeting. Wage-earners no longer need worry that their pay rises will be eaten up by overly rapid price increases. At the same time, employers find it easier to determine the size of the scope for wage increases. It also appears as though what is usually termed "monetary illusion" may have disappeared. The labour market organisations appear today to focus to a greater extent on real wage cost increases. The strong confidence in the inflation target has meant that these organisations' inflation expectations have been at a level of around 2 per cent since 1996.

Sustaining recent progress is a key priority for the Bank of England as I know it is for the SPE. People often ask me what my professional responsibilities in the Bank are. The most formal description is contained in the Bank’s Senior Managers and Certification Regime return. The SM&CR is a critical element of the post-crisis regime for accountability in the whole financial sector, ensuring there is a clear public line of sight running from the senior leadership through to every key function carried out by a financial institution. 2  The SM&CR is an essential part of the soft infrastructure underpinning improved conduct and therefore fairer and more effective financial markets in the UK and globally. 3  The SM&CR entry for me is long, and so I will just flag a few of my key responsibilities. What these boil down to is that among the Governors I have operational responsibility for the Bank of England’s balance sheet. It is the Bank’s balance sheet that is going to be the focus of my talk today. The balance sheet is integral to the operations undertaken in the areas I oversee, Markets and Banking, Payments and Financial Resilience. And it is central to the Bank’s mission for monetary and financial stability: the balance sheet is the hard infrastructure that supports much of the Bank’s policy activity. For most of the time it may not be as newsworthy as some of the tools it supports, like Bank Rate, QE or “lender of last resort”.
India’s economy is the 14th largest in the world measured in nominal US dollar terms, but in terms of purchasing power parity, India is the 4th largest economy in the world according to the iMF. India’s GDP in purchasing power terms has also risen substantially, with its share rising from 4.3% to 6.1% of world GDP over the past 15 years. India’s unique characteristics that enhance this growth potential include its dynamic population and demographic structure, as well as its emergence as a global leader in service exports. This dynamism, growth, and positive sentiment has been clearly evident in India’s stock market, which has rallied 40% in 2005, second only to Korea as best performing major market in Asia last year. Sometimes overlooked however, is an informal group of Asian economies (excluding Japan) that account for the majority of trade and GDP in East Asia, known as Asia-9. The Asia-9 economies comprise China, Hong Kong, Indonesia, Korea, Malaysia, Philippines, Singapore, Thailand, and Taiwan. The share of Asia-9’s GDP in purchasing power parity terms has grown from 11.4% in 1990 to 20.6% in 2005. To put this in perspective, this exceeds the EU’s PPP share of world GDP of 18.8%, Japan’s share of 6.7%, and is very close to the United States 20.7% share of world GDP in 2005. But I am not here today to overwhelm you with facts and figures! Today I would like to discuss one of the most important drivers of this phenomenal growth – and that is, international trade.

M R Pridiyathorn Devakula: India and Asia - trade linkages and alliances Remarks by Mr M R Pridiyathorn Devakula, Governor of the Bank of Thailand, at the Wharton Global Alumni Forum, Mumbai, 6 January 2006. *  *  *  Dean Harker, Mr. Ambani, Ladies and Gentlemen, I am honored to be here today among friends and associates of the Wharton Global Alumni. Given that it is the first time that the School is organizing the Forum in India, it seems only fitting that we should be talking about the rise to prominence of India as an engine of growth, both in the region and globally. More importantly, I would like to highlight the potential for India’s trade and investment linkages with East Asia, and how the two regions of South and East Asia can leverage on one another and become a global force to be reckoned with. China and India, Asia’s two largest economies, are often hailed as potential growth areas and the new engines of growth for the world. China’s rising economic prominence has been particularly evident in the past decade and a half, with its gross domestic product (GDP) in purchasing power parity (PPP) terms, measured as a share of total world GDP, rising from 5.7% in 1990 to 13.6% in 2005. India, although coming later into the scene, has quickly caught the attention of the world as a potential global economic powerhouse.