samchain/econo-pairs-v1 huggingface dataset:
Experiences so far show that the work on the repo rate path and publication of the path have functioned well. To crown it all, we have gained a monetary policy discussion that is aimed more at long-term issues and not merely at whether or not the interest rate should be altered a stage. My view is that our own repo rate path is quite clearly preferable to the other two alternatives that were tested. I believe that this is also the predominant view of most of those outside of the bank, now, three years later. The repo rate path served us well during the crisis. We were able to clearly signal that the repo rate will be low for a long period of time to alleviate the effects of the fall in demand and to attain the inflation target. There have been slight differences of opinion among us Executive Board members with regard to the time when an increase in the repo rate will begin. But these have been only slight, the larger moves have been clear. It has been necessary to have a low repo rate over a long period of time. In this context, changes in the repo rate amounting to 0.25 percentage points slightly sooner or later do not make a significant difference. According to our repo rate forecast in April, the real repo rate will have been below zero for two years, and it will remain low throughout the forecast period.

I shall now go on to briefly describe how the repo rate forecast is produced. How is the repo rate path determined? The publication of our repo rate forecasts makes greater demands than previously on the internal preparation work. The new method of working requires a greater interaction between the staff and the Executive Board, and the Board members are involved at an earlier stage of the process. This is made easier by members of the Executive Board being full-time employees and not merely being called together for monetary policy meetings. So what does the practical work leading to the published repo rate path actually entail? The monetary policy decision-making process normally follows an established preparatory process. 4 During a number of weeks employees in the Monetary Policy Department prepare draft forecasts for economic developments, including the repo rate. After this there are meetings together with the Executive Board of the Riksbank, and a main scenario for economic developments, including the repo rate, is drawn up. Of course, the main scenario is based on a combination of model-based forecasts and assessments. 3  See Lars E.O. Svensson, “Policy expectations and policy evaluations: the role of transparency and communication”, Economic Review 2010:1, Sveriges Riksbank. 4  For a more detailed description of the preparatory work prior to the monetary policy decisions, see Kerstin Hallsten and Sara Tägtström (2009): “The decision-making process – how the Executive Board of the Riksbank decides on the repo rate,” Economic Review 2009:1, Sveriges Riksbank.
With the completion of the debt restructuring process under CDRC envisaged by July 2002, the asset quality of banking institutions can be expected to improve by approximately 3 percentage points. The consolidation programme for the domestic banking institutions represents a major structural enhancement of the banking system. The successful completion of the consolidation and integration of the banking groups in 2001 has benefited the industry and the banking public. The merged banking groups are now more well capitalised to meet future calls for capital expenditure as well as undertake a wider scope of business activities. The operational business integration process and rationalisation exercise have been an important part of the merger to reduce duplication of resources and to attain higher levels of economies of scale and efficiency in the banking institutions. The year 2001 marked a significant period for the Islamic banking industry. In terms of performance, the industry registered encouraging growth during the year. Total assets of the Islamic banking increased by 25.2%, amounting to RM58.9 billion as at end-2001 representing 8.2% of the overall banking system. In terms of profitability, significant growth was recorded with an increase in pre-tax profits by 69.9% to RM905.9 million during the year. Among the measures implemented in 2001 to further develop and strengthen the regulatory framework of the Islamic banking industry were the adoption of Risk Weighted Capital Ratio (RWCR) framework; the implementation of Rate of Return (ROR) framework; and the implementation of training and awareness programmes.

In respect to the conditions prevailing in Malaysia, Malaysia's strong economic fundamentals, with low rate of inflation, strong external balance, low level of foreign debt, strong reserves levels and strengthened banking sector have provided strong support for the pegged exchange rate regime. Malaysia also has sufficient flexibility to undertake adjustments on all sectors of the economy to remain competitive. The diversified economic structure, the enhanced mobility of capital and labour has also provided Malaysia with increased resilience to weather external shocks. Malaysia also had the flexibility of policy to respond to the circumstances. In all cases, when an exchange rate regime has failed, it was not due to the regime itself, but due to the weaknesses in the economy and the financial system. Having undergone significant transformation and emerging with a much strengthened set of fundamentals, the Malaysian and regional economies are better able to absorb the volatility in the exchange rates. Countries are also more cognizant of the costs of currency depreciation, particularly on confidence. As an example, comparing the response of regional currencies during the two episodes of yen depreciation, one in the early part of 2001 and the other towards the end of 2001 and early 2002, it is clear that the response of regional exchange rates was significantly more muted during the most recent episode.
The high level of indebtedness built up during the economic upturn in many countries significantly increased this risk. Positive expectations of the future had increased companies' financing needs for investment. At the same time, a bright picture painted of the future and an increase in wealth had stimulated households' consumption and increased their investment in housing. It was easy to imagine a risk scenario where household sector demand declined so rapidly that heavily indebted companies went bankrupt, where unemployment rose drastically and where banks an other lenders suffered extensive loan losses. This negative spiral could continue with further falls in share prices and household wealth and rising credit risk premiums would make lending more expensive. If this negative sequence of events were not broken, high loan losses could eventually lead to bank crises and credit crunches, which would contribute further to the downward spiral. A credit boom, large increases in asset prices and a high rate of growth in investment, often concentrated on a particular sector, have been the factors preceding serious financial crises around the world. However, it is important to remember that neither a credit boom nor a large deficit on the current account need be interpreted as an accumulation of financial imbalances. If savings and investment decisions are based on realistic expectations of future growth and banks and financial investors have been able to make realistic assessments of the credit risks connected with investment projects and consumption loans, then this development is more a sign that the international capital markets are functioning efficiently.

The lack of supervision also applied to Long Term Capital Management, LTCM, some years earlier. One might wonder whether function rather than company type might not be a better base for supervision. There is otherwise a risk that functions essential to society and thus needing protection will be transferred to companies not subject to supervision. At the same time, the public sector is in practice forced to intervene if the failure comprises a threat to the system, regardless of whether it has been able to exercise supervision. To what extent Enron was involved with functions that can be assessed as worth protecting is a question for discussion, but it is an important question of principle. We cannot and should not regulate all companies involved with financial operations, e.g. in managing their own funds. Secondly, it appears obvious that accounting regulations, at least those in the US, have not developed at the same rate as the instruments and forms for capital acquisition on the financial markets. Is it really reasonable in the long term for an increasing number of companies' risks to be reported off balance sheets? In the case of Enron, it also appears that there were risks that did not need to be reported at all, according to the regulations in force, such as liquidity risks that were triggered by a down-rating.
See, for example, the estimate of the impact published in Box 6 of Economic Bulletin 4/2018 entitled “Recent pension system measures: analysis of impact on public finances”. Alternatively, the AIReF has recently published an estimate that quantifies the impact of this measure as an increase in spending of 2.3 pp of GDP in 2050. 11  33  of the sustainability factor has the capacity to reduce pension spending by 0.9 pp of GDP in 2050.12 Addressing these population ageing pressures will therefore require increasing the system’s resources or alternatively reducing the rate of benefit or further increasing the effective retirement age. The specific decisions in relation to this necessary revision of the system need to be taken in the political sphere, so that the various societal preferences regarding pension levels and the resources necessary to finance them are weighted appropriately. An important objective, in this respect, is that the reform eventually implemented should involve an increase in transparency as regards the public pension system benefit levels that agents can anticipate. This would allow citizens to take decisions regarding work, savings and the time of retirement on the basis of a set of information that is as complete as possible. Likewise, whether or not the reform strategy eventually decided upon involves a moderation in spending or an increase in revenues, the redistributive consequences within each generation and across generations need to be taken into consideration. These consequences, especially the latter ones, are particularly important in every pension system.

However, these are not always straightforward, given the difficulties in agreeing how to apply the fairness principle and because economic theory and empirical evidence are not always capable of reaching irrefutable conclusions regarding the effects of the various taxes on economic growth. 31  A first approximation that may be useful is to compare the composition of tax receipts in Spain with their composition in other European countries. In this respect, Spain stands out for its low level of indirect taxation, which includes VAT, excise duties and, as a particular case of the latter, environmental taxes. Specifically, almost half of the difference between total tax revenues in Spain and the arithmetic mean for the euro area, as a percentage of GDP, is explained by the higher proportion of goods and services taxed at the reduced and super-reduced rates of VAT. A very significant part of this gap is also explained by the lower level of environmental taxation, which is primarily the result of low taxation of hydrocarbons. As regards direct taxation, corporate income tax receipts are also low in Spain. In contrast, when taxes on personal income are considered together with social contributions, their contribution to the revenue gap with the euro area is roughly zero. As highlighted by the second phase of the public spending review undertaken by the AIReF, there is considerable scope to reconsider a characteristic feature of the Spanish tax system, namely the particularly high level of tax benefits.
Figure 15 Inflation expectations  Forward breakeven inflation based on swap rates  EES and FOS surveys (*) (percent)  7  7 7  (moving weekly average, percent)  7  6  6 6  6  5  5 5  5  4  4 4  4  3  3 3  3  2  2  1  2 2 1 1  0  0 06 07 08 09 FOS 1 yr ahead FOS 2 yrs ahead  10  11  EES 1 yr ahead  EES 2 yrs ahead  1 0  0 06  07 1 in 1  08  09 3 in 2  10  11 5 in 5  (*) The FOS uses survey of first half of the month, except for August 2011, which uses survey of second half of the month. Source: Central Bank of Chile. BIS central bankers’ speeches  15  Figure 16 MPR and expectations  (percent)  9  9  7  7  8  8  6  6  5  5  4  4  3  3  2  2  1  1  0  0 07  08  09  10  11  12  13  TPM  EES, August 2011  Forward IPoM septiembre 2011 Forward, Sep.2011 Report  FOS, second half August 2011  Source: Central Bank of Chile. 16  BIS central bankers’ speeches

A number of data sets have already been, or are about to be, made available by the ESAs:   banking sector data, collected by the European Banking Authority (EBA) on a quarterly basis, relate to: supervisory data on solvency, credit risk and asset quality, earnings risk and balance sheet structure ( key risk indicators), as well as to data on large exposures, broken down by instrument and by sectoral and geographic counterpart, for samples of EU large banking groups;    insurance sector data collected by the European Insurance and Occupational Pension Funds Authority (EIOPA) on an annual basis and, possibly, at a higher frequency relate to aggregate solvency and profit-and-loss data for large EU insurance groups;    quarterly data provided by the European Securities Markets Authority (ESMA) refer to the number of shares admitted to trading in the European Economic Area (EEA), by country and by market, as well as to the list of EEA markets. 1  Council Regulation (EU) No 1096/2010 of 17 November 2010 conferring specific tasks upon the European Central Bank concerning the functioning of the European Systemic Risk Board (Official Journal of the European Union, L 331, 15.12.2010, pp. 162 ff.). 2  BIS central bankers’ speeches  The ECB, in turn, is in the process of making datasets available to the ESRB and the ESAs that meet their requirements.
(2) Geometric average for the U.S., the Eurozone and Japan. Sources: Central Bank of Chile, Consensus Forecasts and IMF. BIS central bankers’ speeches  9  Figure 7 Monetary policy interest rates (1) (percent) 12  12  10  10  8  8  6  6  4  4  2  2  0  0 01  02  03  04  05  06  Developed (2)  07  08  Emerging (3)  09  10  11  Chile  (1) Simple average of monetary policy rates of each group of countries. (2) Considers the Eurozone, Japan and the U.S. (3) Brazil, China, Colombia, the Czech Republic, Hungary, Mexico, Peru, Poland, South Africa and South Korea. Sources: Respective central banks and Bloomberg. Figure 8  Unemployment (*) (index centered on mean of period 1990-2011)  40  40 1.100  1.100  1.000  1.000  900  900  800  800  700  700  600  600  500  500  400  400  20  20  0  0  -20  -20  -40  -40 90 93 96 99 02 05 08 11  Capital goods imports (*) (millions of dollars, moving quarterly average)  06 07 08 09 10 11  (*) Seasonally-adjusted quarterly series. Sources: Central Bank of Chile, National Statistics Institute (INE), and Ricaurte, M. 2011, “Indicadores de Mercado Laboral para la Comparación de las Crisis Asiática y Financiera Internacional ”.

For example, if interest rates decline (as in an economic downturn), leading to a reduction in the government interest burden, primary expenditure can be adjusted upwards and amplify the countercyclical effects of the monetary policy decision. However, if rates rise, as in an economic recovery, governments would have to make more of an effort on primary expenditure. How could we set the target for the expenditure rule? It could be country specific, if – and only if – (i) it seriously takes into account the initial level of debt and its sustainability but also the overall growth potential of the economy, and (ii) is explicitly agreed by a European authority. Another possibility worth exploring to improve our fiscal governance is to set up an adjustment account mechanism. A deviation from the expenditure rule over any year (i.e. a too rapid increase in public expenditure – if limited and occasional – or, on the contrary, a level of public expenditure below the predefined target) could be earmarked for compensation over the course of the subsequent years. The bottom line is that the long-term sustainability of public debt should be ensured by credible but flexible fiscal rules. Sound fiscal rules are also crucial to improve the quality of public expenditure: spending on the future – education, research, the ecological transition, investment – must take priority over spending on the day-to-day operation of public services, or on some of the social transfers.
Fortunately, we need to adopt much less drastic measures than those countries that have had to make deep cuts in public sector staffing levels, wages and social benefits in order to stave off the financial collapse of the state itself. And yet, people in Malta continue to expect the Government to hand out money it does not have. This attitude must change, for not only can it lead to bankruptcy, but it is also indefensible on moral grounds. Politicians, trade unions, NGOs and other opinion shapers must explain that we do not have money for everything and that you cannot have gain without pain. The intelligent thing to do is to work together so as to minimize the pain and then ensure that it is equitably shared. In my view, the priority of the welfare state should be to provide equal opportunities for all, but a safety net only for those who need it most. Universality – dispensing free goods and services to all irrespective of income – is a wasteful and unaffordable principle. In the words of the renowned economist, Jeffrey Sachs, “Even playgrounds should collect tolls, when it is billionaires who are playing in the sandpit.” The social welfare system, including health care, has long been identified, including by the European Commission and the IMF, as offering the greatest potential for savings. Effective measures implemented elsewhere which could be adopted range from user fees for certain public services to policies designed to make work pay.

This is done both because we recognize the lags with which monetary policy operates, and because of our concern about the costs in terms of output loss and employment of adjusting inflation to the target. If we do not do this, the adjustment would take much less time to complete. All this is common knowledge. But I feel it needs to be stressed in order to clear, yet one more time, the mistaken argument that the CBC does not consider the level of economic activity when making its decisions. Additionally it serves to insist on the issue that the current global financial crisis was not caused – as some argue – by monetary policy’s orientation to price stability, but by a tremendous failure in the financial systems of the developed world. Neither the private sector nor policymakers were able to foresee the danger of the imbalances that were accumulating during this decade. Today, the monetary and fiscal stimulus packages are precisely what have allowed the world economy, which suffered an initial shock similar to that of the Great Depression, to show a substantially better performance. This is particularly true in the case of Chile. The evolution of the economy and monetary policy from 2007 onwards In just three years, the Chilean economy has gone through two radically different episodes, although related to one another.
Bean, C. (2006a), Comments on Ken Rogoff: “Impact of Globalization on Monetary Policy” at the Federal Reserve Bank of Kansas City, 30th Annual Economic Symposium, Jackson Hole, Wyoming, 26 August. Bean, C. (2006b), “Globalisation and Inflation”, Speech to LSE Economics Society, London School of Economics, 24 October. Bernanke, B. S. (2005), “The Global Savings Glut and the U.S. Current Account Deficit”, Sandridge Lecture, Virginia Association of Economics, Richmond, 10 March. Borio, C. and A. Filardo. (2007), “Globalisation and inflation: New cross-country evidence on the global determinants of domestic inflation”, BIS Working Papers No. 227. Borio, C. and P. Lowe (2002), “Asset Prices, Financial and Monetary Stability: Exploring the Nexus”, BIS Working Paper 114. Bank for International Settlements, Basel. Boivin, J. and M.P. Giannoni (2006), “Has Monetary Policy Become More Effective?”, The Review of Economics and Statistics, 88(3): 445-462, (January 2003) NBER Working Paper Series, No. 9459. Caballero, R. (2006), “On the Macroeconomics of Asset Shortages”, NBER Working Paper Series, No. 12753. European Central Bank (2007a), Financial Stability Review, June. European Central Bank (2007b), Financial Stability Review, December. European Central Bank (2008), “Globalisation, trade and the euro area macroeconomy”, Monthly Bulletin, January, pp. 75-88 Ferguson, R., P. Hartmann,, F. Panetta, and R. Portes (2007), International Financial Stability, IXth Geneva Report, ICMB, Geneva.

By the end of the third quarter of 2009, the total assets of Islamic investment funds were estimated at about $ 27 billion, spread across 478 Islamic investment funds worldwide. Dear audience Islamic banking contributes to social and economic development through investment in areas related to the real economy such as production of goods and services and commerce. In addition, Islamic Banks and Institutions have proved their success in attracting savings, fulfilling customer’s needs and achieving their interests. Moreover, Islamic banking has made great strides in boosting banking business by introducing innovated products and tools and by adopting new financing forms such as Ijarah (leasing), Istisnaa and Salam, along with Mudarabah (profit and loss sharing) and Musharakah (partnership). Furthermore, a variety of Islamic Sukuk (Islamic bonds) has emerged, and some Islamic banks have started to arrange for syndicated financing transactions in accordance with Islamic forms, and others are managing Shari’ah-compliant investment funds. Every tool of the Islamic banking has its own contractual nature and features, which differ from other tools in terms of risks, guarantees and pricing. Islamic banking services have not been confined to the activities mentioned earlier, but the scope of their transactions has been extended to include other services such as: providing joint finance, issuing banking bonds and opening letters of credit. Islamic institutions and banks provide a variety of finance and insurance methods for enterprises, management of financial portfolios, and Tawarruq assets (assets securitization).