samchain/econo-pairs-v1 huggingface dataset:
This supports the interpretation of the first price peak as a property price bubble. The value of office property increased in 2005, from a historically low level. In relation to historical levels, the rise in the value of commercial property seems to be moderate, compared with the rise in capacity utilisation. One possible reason for this may be that employment growth was for a long period relatively low in this upturn compared with the upturns in the 1980s and 1990s. This has now changed. In addition, signals from market participants indicate that the rise in value for 2005 as a whole will be sharper than the chart estimate, which was calculated as of July 2005. Developments in real house prices also tracked developments in capacity utilisation from 1985 to 1998. In the period since then, however, house prices have increased further at a steady pace, even when business cycles have fluctuated. This sharp rise, combined with similarly strong growth in household debt, may be viewed to some extent as a delayed adaptation to the deregulation of the housing and credit markets in the 1980s, after many households burned their fingers immediately after deregulation. In recent years, household income growth has been solid, household confidence regarding the future has been strong and households probably perceive higher income levels as permanent. This may have resulted in a further rise in house prices and debt. In addition, low real interest rates are currently making a contribution. Sales in the commercial property market reached a very high level in 2005.

The third imbalance is the one that results from globalisation and from the escape from poverty of hundreds of millions of people, notably in China, India and elsewhere in Asia as well as in Africa, a change which is putting pressure on energy and agricultural commodity prices. The imbalance between growth in global demand and rigidity of supply points to scarcities that are reflected in prices. The uncertainties of the financial markets have in the end contributed to price tensions. Also in this instance, the alarm was raised some time ago, although little notice was taken. The price of oil, for example, was around USD 20 a barrel in 1999 and in the eight years thereafter it rose fivefold (tripled when priced in euro). Fortunately, European countries have resisted the temptation to reduce energy taxes, which would have led to an increase in demand and therefore ultimately raise the rich countries’ oil bill. On the other hand, other industrial countries have continued to keep energy taxation at very low levels, in order to support consumption. In some cases production of “bio-fuels” has been encouraged, which has led to further distortions in energy and food prices. The main oil and energy companies until two years ago have continued to price oil at USD 40 a barrel in their industrial plans, thus underestimating the need – and the opportunity – for investment in order to increase supply.
For us, the Taylor rule derives its appeal from three features. The first is its simplicity in describing the behaviour of different central banks by estimating the policy reaction to deviations from the inflation target and to the output gap. The second is its quality as a benchmark in assessing the current stance of monetary policy with respect to the historical average for a similar macroeconomic situation. And, thirdly, the Taylor rule is appealing because it sets the standard by which monetary policy is introduced in macroeconomic models for forecasting and simulation purposes. The SNB’s monetary policy focus is on maintaining price stability, and we do not follow any explicit rule for setting the short-term interest rate. However, the Taylor rule serves as an important indicator in our decision-making process that helps us to conduct a systematic policy. Having talked about John the researcher, I would like to turn now to John Taylor the policy advisor. Time and again, John has merged research with policy making. On this account, his record is long and outstanding as well. He served as a member of the President’s Council of Economic Advisors from 1989 to 1991. He was on the Panel of Economic Advisers of the Congressional Budget Office from 1995 to 2001. And from 2001 to 2005, he served as Under Secretary of Treasury for International Affairs. His responsibilities included setting up a new currency in Iraq and getting terrorist financing under control.

This illustrates the importance of further reforms. 1/1  BIS central bankers' speeches
Public and private efforts have stepped up significantly to expand the capital markets domestically as well as regionally. Across the region, policymakers are sharing knowledge and expertise to ensure efficiency and pragmatism in the implementation of policy. Most obviously, Asian countries have also built up international reserves to a multiple of short-term external debt or other traditional measures of potential claims on reserves. They have also relied less on foreign debt financing and shifted more toward equity securities and direct investment. 4 This shift in the pattern of capital flows demonstrates to some extent advances in equity market development and corporate governance in the region. For a few countries, reserve accumulation partly constitutes a deterrent to the repeat of the last extreme episode of instability in 1997. As an added benefit, a relatively well-developed system of prudential banking regulation has also helped these countries avoid speculative pressures on their exchange rates. As far as financial integration is concerned, there have been selective and timely capital account restrictions and liberalization on both inflows and outflows over the years. Much of this caution derives from the bitter lessons from the 1990s. But, even so, it is worth mentioning that, measured by total foreign assets and liabilities as a percentage of GDP, the trend from Bangkok to Seoul is that of more financial integration over the past 20 years. 5 Ladies and Gentlemen, These changes in policies and risk awareness make it less likely that financial market disturbances will trigger a sharp and broad-based dent to real economic outcomes.

But the only entity with sufficient financial and managerial resource to absorb a large asset or liability portfolio, without suffering chronic indigestion, is another big bank. So it was during the crisis – for example, Bear Stearns was swallowed by JP Morgan Chase, Merrill Lynch by Bank of America and Washington Mutual by Citigroup. This makes for a rather uncomfortable evolutionary trajectory, with rising levels of banking concentration and ever-larger too-big-to-fail banks. Levels of banking concentration have risen in many countries since 2007, precisely because of such shot-gun marriages by oversized partners. In other words, resolving big banks may have helped yesterday’s too-big-tofail problem, but at the expense of worsening tomorrow’s. One way of avoiding this problem is to re-capitalise a bank by bailing-in its creditors, rather than transferring its assets. But resolution rules of this type are not problem-free either. Like all policy rules, they face what economists call a time-consistency problem. Whether a rule is followed in practice depends on the balance of costs and benefits at the time crisis strikes, not at the time the rule is written. That is why policy might in practice lack consistency over time – hence time-inconsistency. Consider that trade-off when a big, complex bank hits the rocks. On the one side is a simple, but certain, option – state bail-out. On the other is a complex, and less certain, option – resolution.
Caleb M Fundanga: Develpments between the Bank of Zambia and the Lusaka Stock Exchange Opening remarks by Dr Caleb M Fundanga, Governor of the Bank of Zambia, at the LUSE/BESA/BOZ workshop for secondary trading of government bonds, Lusaka, 3 March 2008. *  *  *  The Chairperson, Resource Persons, Workshop Participants, Distinguished Ladies and Gentlemen, I am honoured for the invitation extended to me this morning to officially open this important workshop on secondary market trading for Government securities. To begin with, I wish to commend the Lusaka Stock Exchange (LUSE), the organizers, on the timeliness of this workshop. I have little doubt most of you will agree with me that this discussion on the secondary market is long overdue and therefore could not have come at a better time. Dialogue among key stakeholders is invaluable to the success of market development efforts. This is particularly so because this allows each participant to share and learn from their diverse experiences in this area. I must say that this workshop addresses a subject in which I personally take keen interest. This is because I have, over the recent past, participated in a number of meetings with key investors in our securities market. At these meetings, issues surrounding the development of the secondary market have always been at the centre of our deliberations. I am glad that we have now began to address those very issues.

Emilija Nacevska: Strengthening the capacities of the system for fight against counterfeiting of the euro Speech by Ms Emilija Nacevska, Vice Governor of the National Bank of the Republic of Macedonia, at the opening conference of the Twinning Light Project "Strengthening the capacities of the system for fight against counterfeiting of the euro", Skopje, 15 January 2019. * * * Dear Minister Oliver Spasovski, Your Excellencies Samuel Zbogar and Thomas Gerberich, dear Project Leaders Biljana Celeska Anevska and Peter Spicka, dear Mr Damir Bichanic, distinguished representatives of the Delegation of the European Union in the country and representatives of the Ministry of Interior, distinguished colleagues, dear guests, It is my honor and pleasure to greet you on the behalf of the National Bank and to welcome you to today’s event held in our institution, marking together the beginning of this very important Twinning Light Project aimed at strengthening the capacities of the institutions involved in the system for fight against counterfeiting of euro. At the very beginning of my speech, I would like to express the gratitude of the National Bank to the European Union, because it has recognized the determination of our key institutions responsible for fighting money counterfeit to put their maximum in establishing a strong and efficient system for protection of the national, as well as the financial interests of the Union.
The setting-up of a common backstop, as mentioned in the European Commission’s communication of 11 October, is a promising avenue, which could take the form of a credit line granted by the ESM (the European Stability Mechanism). If it is placed within the ESM's remit, the rules for triggering this backstop could be introduced during the ESM governance review. Furthermore, this avenue could provide a partial response to the issue of the liquidity of newly resolved entities – mainly the “good banks” –, which has not yet been addressed with sufficient clarity: liquidity support from public sources, beyond what can legitimately be expected from the Eurosystem, should be clarified. -  Second, consistency in the legal framework and requirements: faced with the accumulation of new and “separate” requirements, we need to adopt a holistic and consistent approach in order to avoid a prudential overload. In particular, the Total Loss Absorbing Capacity (TLAC) requirement resulting from the new international framework requires a consistent adaptation of the European minimum requirement for own funds and eligible liabilities (MREL). Therefore, the MREL targets should be set on the basis of updated prudential requirements – pillar II and buffers – and the most up-to-date financial position of the banks concerned. It is a question of consistency. In the same vein, the consequences of the Basel III reforms package – when it is finalised – should be carefully 2  taken into account, as it may lead to increased risk-weighted assets, which could in turn impact the MREL.

Speech by François Villeroy de Galhau, Governor of the Banque de France and President of the ACPR  ACPR conference of 22 November 2017 Bank resolution: from regulation to implementation  Ladies and Gentlemen,  I am delighted to welcome you to this new conference organised by the Autorité de contrôle prudentiel et de résolution. For the first time, the morning of this conference will focus on bank resolution. This is always a somewhat paradoxical subject: if we are spending time on it today, it is in the hope that we will never have to deal with it in the future. "Si vis pacem, para bellum", as the Romans said... just as they prepared for war to maintain peace, we must be fully prepared for a crisis if we are to avoid it. But I would like to start by noting an important victory: that of Paris and France, which will welcome the European Banking Authority. It represents an achievement for a highly motivated and dynamic team, as well as a threefold recognition, i.e. that of the attractiveness of France and the Paris financial centre today; the richness of a financial ecosystem that boasts one of Europe's most impressive talent pools; and lastly, I believe, the quality of the public regulators and the supervisor – the ACPR. And the European Banking Authority's decision to move from London to Paris clearly bodes well for other post-Brexit financial relocations.
Embedding resolution into the public policy objectives of financial regulation matters for two reasons relevant to competition: first, because, to repeat, exit enables entry; and, second, because if, as we will, we require new entrants to satisfy us on their resolvability in order to be authorised, we can lower the barriers and costs of opening for business. We have already started to put this new approach into operation. Resolution of failed firms consistent with the public policy objectives is one key plank of the new approach to financial regulation. Another key plank concerns the macro-prudential approach to regulation. The legislation will establish the Financial Policy Committee (FPC), charged with the primary objective of identifying, monitoring and taking action to remove or reduce systemic risks with a view to protecting and enhancing the resilience of the UK financial system. In June, the Chancellor announced that the government would amend the Bill to give the FPC a secondary objective so that subject to being content on the first objective, it should support the economic policy of the government, including its objectives for growth and employment. Currently, the FPC is acting in an interim capacity to undertake, as far as possible, the future statutory FPC’s macro-prudential role. Macro-prudential regulation is focused on protecting the financial system as a whole. In a very “big picture” sense, there is nothing new about this activity. The problems of the last five years have emphasised the close links between the health and behaviour of banks and the condition of the economy.

We will get a much clearer focus from splitting prudential and conduct regulation for banks and insurers, from introducing macro-prudential regulation to help to protect the financial system as a whole, and from  4  BIS central bankers’ speeches  focusing our regulation on applying judgement in a transparent way. Firms that mess up should, and will, be allowed to fail, but it must not be at the cost of damaging the financial system and economy. Ringfencing commercial and investment banking will help to achieve that objective. And, out of these reforms I hope we can encourage a banking system that is more open to competition and serves the public more effectively and, more broadly, a financial system that delivers the public policy objective of financial stability. Thank you. BIS central bankers’ speeches  5
And that means it will have less scope to respond to slowing demand – the risk posed by the current turmoil in financial markets. 6  BIS Review 22/2008  Annex: Charts2 Chart 1: CPI fanchart from February 2007 Inflation Report, and outturns Percentage increase in prices on a year earlier  Chart 2: GDP fanchart from February 2007 Inflation Report, and outturns Percentage change in output on a year earlier  4  CPI outturns  6 5  GDP outturns 3  4 3  2 2 1  1  0 0 02  03  04  05  06  07  08  09  10  Chart 3: CPI fanchart from February 2008 Inflation Report  2  -1 02  03  04  05  06  07  08  09  10  Chart 4: GDP fanchart from February 2008 Inflation Report  All fan charts and probability bar charts shown are conditioned on market interest rates.

Strong demand, particularly from China has clearly been one major factor. But there have been supply side issues too. And the strength of some commodity prices also reflects their status as an investment class at a time of low global interest rates. Over the past year alone, oil prices have risen by around 60% in dollar terms and agricultural food prices by around 50%. Imported cost pressures in the UK will also reflect the fall in the effective exchange rate, down by 9% since the beginning of August last year – the largest such decline since sterling left the ERM in 1992. There are few reasons to expect this to be rapidly reversed. As a result of these developments, producer input and output prices are now increasing faster than at any time since 1990, and import prices have picked up sharply. These cost pressures have not yet fed through fully into consumer prices, but from next month CPI inflation is likely to rise more sharply, in particular reflecting the impact of higher utility bills. There is essentially nothing the MPC can do about this immediate impact on the inflation rate. But its implication for policy depends on whether people recognise the temporary nature of the pick-up in inflation. The MPC’s remit in setting interest rates is clear – to keep inflation at 2%. But we have discretion to decide how fast to return inflation to target, if it is thrown off course by a sharp shock, such as the current surge in world energy prices.
The decline in house prices and the surge in foreclosures now underway will have significant spillovers to other homes in the same neighborhoods, effects that are not fully incorporated into decisions by private creditors and investors to workout mortgages on mutually beneficial terms. The degree to which mortgages are now held in securitized and complex leverage structures exacerbates the incentive and coordination problems inherent in this situation. Carefully designed, targeted programs in cooperation with the private sector can play an important role in resolving the various constraints that are now impeding economically viable mortgage restructurings. Given the breakdowns in the securitization process and its potential impact on the supply of new mortgage credit, it also makes sense to explore ways to expand the scope for existing government programs to support financing of new homes. This policy framework – macroeconomic stimulus, liquidity support, new equity for the financial system, and targeted support for housing – will help reduce the risks to the outlook and bring about an earlier return to growth rates more in line with the economy’s long term potential. Longer term reforms of the financial system The unwinding of this global financial boom has caused a substantial degree of stress to the financial system. Was this preventable? I don’t believe that asset price and credit booms are preventable. They cannot be effectively diffused preemptively. There is no reliable early warning system for financial shocks.

And yet policy plays an important role in determining the dimensions of financial booms, and policy helps determine the ability of the financial system and the economy to adjust to its aftermath. We need to undertake a broad set of changes to address the vulnerabilities in our financial system revealed by this crisis. Just as a long list of factors contributed to the trauma, there is no single reform that offers the promise of sufficient change. The Presidents Working Group on Financial Markets and the Financial Stability Forum, which bring together policymakers and regulators from the major financial centers around the world, are in the process of outlining a comprehensive framework of reforms. Many of these recommendations will focus on changes to the mortgage finance market, the ratings process for ABS and structured credit products more broadly, regulatory and accounting treatment of these instruments and special purpose financing vehicles, the disclosure requirements on instruments and institutions, and other dimensions of the securitization process. I want to conclude with a few comments on some of the broader policy questions we face in designing these reforms. Regulatory reform and simplification The regulations that affect incentives in the U.S. financial system have evolved into a very complex and uneven framework, with substantial opportunities for arbitrage, large gaps in coverage, significant inefficiencies, and large differences in the degree of oversight and restraint upon institutions that engage in very similar economic activities.
As you will have gathered from my earlier summary, many comments have focused, as in the past, on the minimum requirements laid out in Pillar 1, but as we get closer to finalisation, comments about implementation are becoming more important. I would like to take a few minutes now to talk about these other aspects of the New Accord that deserve equal consideration. Let me address four specific issues: ·  Pillar 2 and consistency  ·  Home / host implementation issues on a world-wide basis  ·  Accounting Standards and Basel II  ·  The recognition of diversification  Pillar 2 and consistency On the first of these subjects, as you well know, the innovation of the New Accord does not rest solely on the refinements to the quantitative measures of risk. Another innovation, and one of the most beneficial, is the incorporation of supervisory review into the international framework. This represents a real breakthrough for all of us, since supervisors in each jurisdiction have until now found their own ways to evaluate the adequacy of a bank’s capital base. That is an unsatisfactory solution since it can lead to inconsistencies in the way that a global banking organisation’s operations are supervised at a local level. By incorporating into the New Basel Accord the requirement for supervisors to evaluate the internal processes behind a bank’s view of its need for capital, the Committee expects that bankers and supervisors will engage in a more focused discussion of risk management.

4  BIS Review 42/2003  As we consider the long-term view, we should not lose sight of the fact that we are just at the beginning. The New Accord represents another important milestone in the adoption of more advanced risk measurement and management practices. But to remain robust and relevant to the demands of twenty-first century banking, our capital regulations must keep pace with changes in the market environment and with the state of the art in risk management. On that note, I would like to emphasise the importance of research and debate in promoting the safety and soundness of the financial system. The Basel Committee owes a debt of gratitude to the studies and efforts undertaken by economists, risk management professionals, and researchers in both the public and private sectors as we have sought ways to refine the proposals. We know that your work has helped to inform ours. The future evolution of the Accord will be dependent on input and contribution from the industry, and I look forward to continuing our healthy and fruitful exchange of views. In closing my remarks today, I would like to stress again the Committee’s commitment to having a balanced Accord of the highest quality. Although we are encouraged by the general support for the proposals shown through the CP3 process, we recognise that there are some high-level issues still to be addressed and we are working hard to find the best ways to resolve them.