samchain/econo-pairs-v1 huggingface dataset:
Karl Marx’s (1867) work also centred on this relationship, but he stressed the reverse causation: the effect of the economy’s structure and markets on society’s values and culture. In recent years, and after a prolonged period of neglect, the role of values or culture as an underlying determinant of market efficiency and overall economic performance has been emphasised and explored by, among others, Banfield (1958), Aghion and Howitt (1998, 2005), Eggertson (2005), Blanchard (2000, 2003, 2004), Layard (2003), Bruni and Porta (2005), Sapir (2004, 2005) and Edmund Phelps (1973, 2003, 2006), winner of the Nobel Prize in economics last year. III. Economic growth in Europe and the United States: the contribution of productivity, labour utilisation and population  Let me now address these issues by examining the growth performance of the European economy. I will use as a benchmark for comparison and assessment the US economy, which is comparable in size and degree of development to Europe’s and which has experienced high growth rates, especially since the mid-1990s. Economic growth in Europe over the past decade and a half, and especially since the mid-1990s, has been below our expectations and unsatisfactory in comparison with the United States. The average growth rate for the euro area in the period 1990-2005, was 2.0%, noticeably below the average growth of 2.3% recorded in the 1980s (1980-1989). Moreover, the gap in real GDP growth between the United States and the euro area widened over the period 1980-2005, as shown in Chart 1.

The sampling approach generates the same entry and exit behavior as present in the population, with young individuals and immigrants entering the sample and deceased individuals and emigrants leaving the sample each quarter at the same rate as in the U.S. population. As a result, for each quarter starting in 1999, the panel constitutes a representative cross-section of the population of borrowers. Moreover, once the random sample of individuals is identified, we then include the credit records of all individuals living at the same address, so the panel can be used to analyze new loan originations, balances, and delinquencies at the household level. Consumer debt traditionally has been measured at the individual level, but most economic decision making is done at the household level. In fact, consumer income and assets are commonly measured and analyzed at the household level. For studying household economic behavior, and in particular for understanding life-cycle household finance, it would similarly be more useful to examine debt and credit aggregated at the household level. It may also be important to consider the distribution of debt within households. Beyond the ability to link individual consumer and household-level loans over time, the panel improves on typical loan-level datasets by linking multiple loans to the same consumer. Thus, at each point in time, one can see whether the individual holds multiple first mortgages or a combination of first and second mortgages while at the same time holding various types of non-mortgage debt.
On the one hand, standing back and not intervening would enhance market discipline. This market discipline would provide incentives for better decision-making by the management of financial firms and more vigorous monitoring by their creditors. On the other hand, the risks to financial stability from a failure would have been extraordinarily high, creating pressure for the official sector to intervene in an effort to prevent a disorderly failure. Historically, in most cases when the relevant firms were very large and complex, this dilemma has led to official sector interventions. A consequence is that market discipline was undermined for those firms perceived to be “too big to fail.” To the extent that such actions cause creditors to anticipate future interventions that would shield them from losses, this reduces creditors’ incentive to monitor the management of these firms or respond forcefully in the case of early signs of deterioration. In addition, because the expectation of official sector intervention lowers expected credit losses, this results in cheaper funding costs and provides G-SIFIs with a competitive advantage. It also creates an incentive for such firms to take actions to maintain their too-big-to fail status to preserve this funding advantage. As a consequence, the structure of the financial system has evolved towards larger and more complex firms than can be justified by economies of scale and scope. This is an unacceptable regime and this policy dilemma needs to be resolved.

As an example, an increasing number of trade repositories are collecting valuable transaction data. However, the full benefit of these data can only be realized if we can aggregate this information across the trade repositories, and if regulators have access to the data needed to support their respective mandates.7 The Committee on Payment and Settlement Systems (CPSS) and the International Organization of Securities Commissions (IOSCO) have produced an analysis of some of the foundational steps that need to be taken.8 Again, implementing these steps will take time and will need our continued attention. 5  See FSB and IMF (2009) The Financial Crisis and Information Gaps. Report to the G-20 Finance Ministers and Central Bank Governors. 6  FSB and IMF (2009), recommendation no. 9: “The FSB, in close consultation with the IMF, to convene relevant central banks, national supervisors, and other international financial institutions, to develop by end 2010 a common draft template for systemically important global financial institutions for the purpose of better understanding the exposures of these institutions to different financial sectors and national markets. This work should be undertaken in concert with related work on the systemic importance of financial institutions.
Obviously, Macedonian companies are still profitable and they financially help their parent companies in the troubled Euro area countries. It negatively influences the deposit potential of companies. It is uncertain whether this trend will continue next year. Why do you always connect the issue of the exchange rate policy with devaluation? Is it possible to open a debate in the country, on the economic model, the effects that it provides and the exchange rate regime and its efficiency vis-a-vis the economy? Currently, we have a real exchange rate of the Denar. Demand and supply are balanced. NBRM very rarely intervenes in the foreign exchange market. As a result of the credibility of the Denar and the National Bank created over the past 15 years, we have completely eliminated the speculative demand for foreign exchange. But experience has shown that immediately when the change in the exchange rate is mentioned, a speculative demand for foreign exchange appears and disturbs the balance on the foreign exchange market. This would cause pressure on the exchange rate, higher inflation and ultimately much higher interest rates than the current ones. Who would benefit from that? You take a selected sample of countries with flexible exchange rate that have higher economic growth than Macedonia and you offer it as evidence that such policy gives better results. I will find another sample of countries with flexible exchange rate that have lower growth than Macedonia. It is not economic analysis, it is manipulation.

It is the only way to create higher economic growth. It is a process that should never stop. Better ranking on these lists does not mean that we will immediately have higher economic growth. It takes time, we should continuously improve the conditions for doing business. BIS central bankers’ speeches  5
So, even though the EU membership has acted as a catalyst for country-level real convergence, the development gaps across the regions of Romania have actually increased. Shortly after the EU accession, there was a surge in economic optimism, translating into an acceleration in economic growth, along with a credit and real estate boom. Despite the efforts of National Bank of Romania, which maintained a prudent policy stance, macroeconomic imbalances widened: the current account peaked in 2007 and remained in the double-digit territory in the next year. Unfortunately, fiscal policy poured more gas on the fire by switching to a strongly expansionary stance after EU accession. Thus, when the global financial crisis hit Romania in the fall of 2008, the country had already expended all the bullets in its fiscal policy magazine and was in the unenviable position of having the second largest structural general government imbalance (around 9 percent of GDP) after Greece. There was no choice but to embark on a process of painful fiscal consolidation that was one of the largest and least gradual in the EU. Having prudently built policy buffers in the run-up to the financial crisis, monetary policy was able to maintain a countercyclical stance, yet it could not preclude a large contraction in aggregate demand in 2009 and 2010. Nevertheless, the ensuing correction in macroeconomic disequilibria created the conditions for resilient GDP growth and the loss in output was made up for by the end of 2014. Currently, we are in our ninth year of consecutive economic growth.

This has always been one of the guiding principles for calibrating the stance of the National Bank of Romania’s monetary policy, as well as for developing and employing our policy tools. We must continue on the road ahead keeping in mind that past achievements in terms of convergence, however large, do not guarantee future success (the middle-income trap is a real danger). For a sustainable economic convergence, we have to maintain a long-term perspective and implement coherent policies and reforms. Moreover, having ambitious but, at the same time, realistic anchors (such as the EU accession was for Romania before 2007) does help, as it gives purpose and direction to policymakers and society as a whole. What we need in order to move forward on the convergence path towards euro adoption is, first of all, to understand there is no substitute for a coherent economic policy mix, which should remain so even in electoral years. Secondly, it is important that Europe remains united. As I recently stated in a speech held in Bucharest, whenever things seem to look bad, I remember the words of Jean Monnet, one of the EU founding fathers: “Europe will be forged in crises and will be the sum of the solutions adopted for those crises”. 5/5  BIS central bankers' speeches
Over the past year, low consumer price inflation has probably contributed to keeping nominal wage increases lower than implied by labour market tightness in isolation. Low inflation has resulted in high growth in household purchasing power even with moderate pay increases. The results from this year’s wage settlement indicate that wage growth this year may be lower than the projection in the March Inflation Report. Inflation among our trading partners is expected to be low in the next few years. It is likely that high prices for oil and other commodities will continue to push up prices for goods where wages account for a small portion of total costs. On the other hand, growth among most of our main trading partners will probably be too low for idle resources to be utilised in the next few years. Particularly in the euro area, wage growth is likely to be low as a result of moderate economic growth and high unemployment. Overall, it would appear that external price impulses via consumer goods to the Norwegian economy will remain negative this year and next. There is no indication that growth in imports from low-cost countries is declining. The decline in prices for clothing and footwear will probably continue in the coming years. Prices for audiovisual equipment are still falling as a result of strong international competition and high productivity growth. We assume that the effects of structural changes in these markets will gradually be exhausted towards the end of the projection period.

The borrowers would then spend these monies, thereby boosting economic activity. The funds would not disappear, but instead would flow back into the banking system as they were deposited by those who had received the income generated by the increase in spending, thus replenishing the reserves that had been lent out in the first round of lending. This would result in a new stock of excess reserves that would then lead to a second round of credit creation and a further increase in economic activity. This cycling of excess reserves into credit creation, and the corresponding increase in economic activity, would continue until the excess reserves were fully absorbed by an increase in currency outstanding and/or an increase in required reserves associated with the rise in the amount of banking deposits. Inflation would rise as the excessive credit creation generated by the excess reserves led to an overheated economy and a rise in inflation expectations. But that is not the world in which we now live. Because the Federal Reserve now has the ability to pay interest on excess reserves (IOER), it also now has the ability to prevent excess reserves from leading to excessive credit creation. Because the Federal Reserve is the safest of counterparties, the IOER rate effectively becomes the risk-free rate. 3 By raising that rate, the Federal Reserve raises the cost of credit more generally because banks will not lend at rates below the IOER rate when they can instead hold their excess reserves on deposit with the Fed.
For decades, the primary focus of these institutions has been on providing young people with cognitive skills. That model has worked well in meeting the needs of the skill-shifts seen through each of the three industrial revolutions. 59  Carney (2016). PM speech on science and modern Industrial Strategy, available here: https://www.gov.uk/government/speeches/pm-speech-onscience-and-modern-industrial-strategy-21-may-2018 61 For example: https://vanguardcommunications.net/doctor-online-review-study/ 60  16  All speeches are available online at www.bankofengland.co.uk/speeches  16  Whether that model will meet the needs of the Fourth Industrial Revolution seems more questionable, for two reasons. First, in future it seems very likely young and old alike will be in equal educational need – to train, retrain and retrain again through their 60 or 70-year careers. Second, the skills these people require for the future world of work will no longer be cognitive. Rather, they are likely to be more evenly balanced between the cognitive, technical and social - head, hands and heart. It has become rather trite to talk of the need for “life-long learning”. But never has the need for such learning likely to have been greater given the longer span and greater volatility in future career paths. Making these career transitions will itself call for a particular set of skills – personal resilience, problem-solving and flexibility. As is now well-recognised, these character attributes are best instilled in early years. If we now turn to our existing universities and colleges, at present these do not appear to be ideally sited to meeting either of these secular shifts in educational and training need.

As an early contributor to this industry, I am at least partly to blame. The estimates  of gross job loss span a pretty wide range, but lie anywhere between 10% and 50% of the global workforce, depending on whether it is jobs or tasks that are assumed to be displaced (Table 1 summarises). Even at the lower end of this range, the societal impact would be significant. At the upper end, they would be truly transformative. If the truth lies in between, this could still make the jobs loss from the Fourth Industrial Revolution greater than its predecessors. And if so, then the potential societal costs – such as rising wage inequality and threats to social cohesion – could also be as great as ever previously. 50  Some of the potentially powerful effects of automation on jobs and wages are already apparent. In the US, each industrial robot per thousand workers has been found to reduce the employment rate by 0.2-0.3 percentage points and wages by 0.25-0.5%. 51  52  In Europe, results are more mixed. Research  suggests that technology may have been the largest single contributor to falling labour shares over the recent past. 53  Whether these effects on jobs and pay will be temporary or permanent is far harder to judge. At this stage of the technological cycle, the evidence is more likely to be picking up the shorter-term displacement effects of 48  Haldane (2015b) Haldane (2015b). 50 Schwab (2017). 51 Acemoglu and Restrepo (2017).
Portfolios of loans can be easier for the Bank to assess from a risk perspective, as they do not embed the complex structures sometimes present in securitised assets. And securitising loans into asset backed securities – such as RMBS – is both complex and expensive for the firms, and generally only available to those large enough to have an existing securitisation programme. The ability to accept raw loan collateral means that smaller counterparties, without securitisation platforms, are not disadvantaged when positioning collateral at the DWF. Since financial instability can start with smaller banks just as easily as larger ones, expanding the universe of possible Discount Window counterparties could lead to significant financial stability benefits. Alongside the expansion of eligible collateral to loan portfolios, we have been encouraging banks to “pre-position” their collateral. Pre-positioning involves the commercial banks identifying, and the Bank of England assessing, various types of collateral ex ante, so that it need not be assessed at short notice in the event of a sudden and unexpected need to borrow at the Discount Window. Assessing varied pools of illiquid collateral can be extremely complex and time consuming. The Bank may not be able to lend much, if at all, against collateral where it has not had time to conduct sufficient due diligence. As a result, it is vital that such collateral is pre-positioned well ahead of any need to draw. One of the benefits from having a more public and transparent facility is that such due diligence is much easier to carry out.

As a supplement to the proposed minimal liquidity ratios, the Basle Committee published a revised version of the principles for safe management and supervision of the liquidity risk. We have proactive role also regarding this measure. Last year we prepared and adopted a regulation that requires from the banks to adhere to two liquidity ratios: (1) up to 30 days and (2) up to 180 days, in Denars and foreign exchange, individually. In that way, we encompassed both, the short-term and the long-term aspect of the liquidity. The results from the application of this measure are good. At the end of 2009, we have registered the following: the volume of the liquid assets is significantly over the level registered at the end of 2008; all liquidity indicators improved; the gap between the assets and liabilities from the aspect of their contractual maturity and the high percentage of stable deposits decreased. The history showed again that the financial stability is precious and it represents public good for society. Let us try to learn the true lessons from the latest crisis. I wish you a successful work and pleasant stay in Macedonia. References 1. Blanchard Olivier, Giovanni Dell’Ariccia and Paolo Mauro (2010), “Rethinking Macroeconomic Policy”, IMF. 2. BIS Quarterly review, (March 2010). 3. Caruana Jaime (2010), “Macroprudential policy: working towards a new consensus” (Remarks at the high-level meeting on “The Emerging Framework for Financial Regulation and Monetary Policy”, Washington DC, 23 April 2010). 4.
How do we promote sustainable innovation Let me illustrate now more concretely what we do to foster sustainable innovation. Our actions 2/5  BIS central bankers' speeches  take two main forms: - The support to and implementation of regulatory frameworks and supervisory practices that foster both innovation and the stability of our financial system  - Our inclusion as a player in the financial innovation ecosystem 1Most of the current regulatory framework was designed before the technological “disruptions” that we are now facing. It therefore seems logical to adapt it to these  technological evolutions as well as to their challenges and associated risks. The same, naturally, applies to our supervisory framework and methods. The success of the payment services directives (PSD1&2) has illustrated that the European legislation can accompany new trends and trigger innovation. With new settlement assets such as Global Stablecoins, the adaptation of existing regimes will have to fit into a larger regulatory framework, to be adopted at a global level. These adaptations must preserve and consolidate two fundamentals of financial sector regulation: the financial stability objective and the principle of monetary sovereignty. In this respect, I would like to commend the ambitiousness of the European Commission’s recent Digital Finance Package and its priorities, in particular those to fight against the fragmentation of the digital single market for financial services and to address the new challenges and risks associated with the digital transformation.

It is also well-established that exposure to new and different experiences - sounds, smells, environments, ideas, people – is a key source of creative spark. These external stimuli are fuel for our imaginations and the imagined, made real, is what we typically mean by creativity. To give one example, walking has been found in studies to be positive for creativity, by freeing our minds from its office constraints and exposing our senses to different stimuli.23 So too are random conversations and chance meetings, serendipity being the cradle of creativity. Research shows that face-to-face meetings, like serendipity, also foster ideas and innovation, as does music and other of the creative arts.24 The key point here is that home-working can starve us of many of these creative raw ingredients - the chance conversation, the new person or idea or environment. Home-working means serendipity is supplanted by scheduling, face-to-face by Zoom-to-Zoom. What creativity is gained in improved tunnelling is lost in the darkness of the tunnel itself. I imagine some people will have used lockdown to write that creative novel they always knew was in them. I doubt many will become modern-day classics. For me personally, a large part of my job pre-Covid was spent meeting as wide a range of people as possible in as wide a range of settings as possible - companies, charities, community and faith groups, from all walks of life and right around the UK. It also meant me bringing into the Bank people from very different backgrounds – musicians, sport-stars, poets, authors, philosophers.