samchain/econo-pairs-v1 huggingface dataset:
This has required everyone involved to step up to the plate in a new way. For our senior supervisors, it has meant taking a higher-level and more encompassing view of the potential problems that a firm might encounter and, when necessary, delivering clearer and more timely supervisory messages and guidance to the firm. For directors and senior managers, it has meant a shift toward greater openness and increased candor with supervisors about the condition of the firm, its business strategies and risks, and the issues that they are most concerned about. It has also required devoting more time and attention to their relationship with supervisors. After three years, I can report steady progress from both sides at reaching the “new paradigm” discussed in the G30 Report – but there’s still more to do. As I said a moment ago, much of the focus of the recent G30 reports has been on behaviors and firm cultures. It is right that these topics should be on the top of all our agendas. Five years after the crisis, headlines about bad actors and corrosive corporate environments continue to be all too common. So, my first observation about progress is just that – the topics of culture and behavior are “top of mind” for many senior management teams and boards of directors. It’s an important step to acknowledge that we have an issue.

All of these changes have been designed to achieve a stronger, and more stable, financial system. I think it’s fair to say that the financial crisis made it very clear to all of us that stability was about more than just banks. It is also about the safety and soundness of a variety of interconnected – and oftentimes large – financial firms, regardless of charter or organizational type. Post-crisis, we have a much keener appreciation of how financial stability is dependent on both strong financial institutions and on the soundness of the connections and linkages between and across firms, whether those connections are other firms, financial utilities, or even the phone company. Recognizing these connections, the Dodd-Frank Act expanded the Federal Reserve’s authority for supervision. We now supervise a broader range of financial institutions than we did pre-crisis, like insurance companies, savings and loan holding companies and some market utilities. In the remainder of my remarks, I will discuss both the progress made and the remaining challenges for the firms we supervise in the context of three key overarching principles of our supervisory framework: •  First, resiliency. Financial institutions must be resilient to shocks. Significant efforts have been undertaken internationally and domestically to reduce the likelihood that a large, global bank ever reaches the point where it is at risk of failure. Resiliency is also critical for financial market utilities. Those organizations must have failsafes in place to ensure the smooth functioning of the critical operations they provide. •  Second, management.
These topics are of particular importance in the current context in which our economies are undergoing significant changes in the credit market as well as in the behavior of consumers and borrowers. Therefore, it is essential to upgrade financial infrastructures, which constitute a central element in the credit risk management system, in order to accompany these changes and help us to meet the challenges we face. Before concluding, I would like to emphasize the invaluable opportunities that the new information technologies can offer us in terms of data sharing, collection and storage. But they also involve major challenges, particularly in terms of cyber security and personal data protection. I wish you a successful and fruitful meeting, and hope that you can combine business with pleasure and allow yourself some time to discover the millennial richness of Rabat, this imperial city which was listed by UNESCO as a World Heritage Site on June 29, 2012. Thank you for your attention. 3

Vítor Constâncio: Reflections on financial integration and stability Speech by Mr Vítor Constâncio, Vice-President of the European Central Bank, at the Joint ECB-EC Conference on “Financial Integration and Stability in a New Financial Architecture”, Frankfurt am Main, 28 April 2014. *  *  *  Ladies and gentlemen, Dear colleagues and friends, It is indeed a pleasure to participate in this joint presentation of two important policy reports: the European Commission’s European financial stability and integration report 2013 and the ECB’s Financial integration in Europe 2014 report. Both studies illustrate that some steady, albeit uneven, progress is being made towards financial stabilisation. Banks are reducing their liquidity buffers, repaying our LTROs and regaining confidence from the markets. Money market integration is slowly improving, particularly in the secured segment. Quantity-based indicators confirm a stabilisation in bond markets and improved integration in equity markets. Given where we stood barely two years ago – on the edge of redenomination risks – such progress is encouraging. However, it does not mean we are entirely out of the danger zone. If we look at banking markets, there is still a large dispersion of borrowing costs for nonfinancial corporations across euro area countries. Thus, significant financial fragmentation still remains in the euro area. This is a concern for the recovery and also for monetary and macro-prudential policy. Under the pressure of the global financial crisis and the sovereign debt crisis in the euro area, several solutions – both global and European – have indeed been adopted.
Cesa-Bianchi, A., R. Harrison, and R. Sajedi (2022). “Decomposing the Drivers of Global R*,” Bank of England Staff Working Papers 990, Bank of England. Cunliffe, J. (2019). “Financial Stability and Low for Long," Speech by Jon Cunliffe at the Society of Professional Economists Annual Conference, London. De Loecker, J., J. Eeckhout, and G. Unger (2020). “The Rise of Market Power and the Macroeconomic Implications  ,” The Quarterly Journal of Economics, 135, 561–644. Del Negro, M., D. Giannone, M. P. Giannoni, and A. Tambalotti (2019). “Global trends in interest rates,  " Journal of International Economics, 118, 248-262. De Ridder, M. (2016). “Investment in Productivity and the Long-Run Effect of Financial Crises on Output  ,” Cambridge Working Papers in Economics 1659, Faculty of Economics,  University of Cambridge. De Ridder, M., (2019). "Market Power and Innovation in the Intangible Economy  ,"  Cambridge Working Papers in Economics 1931, Faculty of Economics, University of Cambridge. Döttling, R., G. Gutierrez, and T. Philippon (2017). “Is there an investment gap in advanced economies? If so, why? ,” In Investment and Growth in Advanced Economies, ECB: Frankfurt  am Main. Eggertsson, G. B., N. R. Mehrotra, and J. A. Robbins (2019). "A model of secular stagnation: Theory and quantitative evaluation 48.  ," American Economic Journal: Macroeconomics, 11, 1-  Page 19  Fernald, J. and R. Inklaar (2022). "The UK Productivity "Puzzle" in an International Comparative Perspective  ," CEPR Discussion Papers 17321, C.E.P.R. Discussion Papers. Goodhart, C. and M. Pradhan (2020).

For some time, efforts have been under way worldwide to reform major reference interest rates such as Libor. These reforms aim to put existing benchmarks on a more solid footing and, where necessary, to develop alternatives. In the case of Libor, these reforms are still ongoing. In the context of these reforms, a decision has already been made to discontinue the TOIS fixing on the Swiss money market and replace it with SARON at the end of 2017. This is due to the fact that, despite various reform attempts, the volume of transactions underlying the TOIS reference rate has remained too low for efficient price formation. Transaction volume is not expected to be an issue with SARON. Unlike the TOIS fixing, which is calculated using data contributed by a panel of banks, SARON is based on actual market transactions and binding quotes. This fact reinforces trust in SARON and makes it more attractive as a reference rate for all money market transactions. Progress has already been made in establishing SARON on the Swiss money market. For some weeks now, it has been used as the reference rate for interest rate derivatives; hence, quotes for SARON interest rate swaps (SARON swaps) are already being offered. We can observe this in chart 4, which plots the curves for TOIS and SARON swaps. We see that the yield curve for SARON swaps already covers all maturities. Moreover, the SARON yield curve is below the TOIS curve.
For example, although unemployment has moved more than three quarters of the way from its peak back towards what we might consider its equilibrium rate, unit wage cost growth is still just over one third of its pre-crisis rate. 2 There are a multitude of possible explanations for this. But one I put weight on is that, in light of six years of very weak wage growth, workers are not quite confident enough to demand the kinds of wage increases which would have been the norm in the years prior to the crisis. Were the recovery in wage growth not to materialise and inflation to linger far below the 2% target for longer than currently embodied in the MPC’s forecast, it would be a very undesirable outcome. It would prolong the headwind from deleveraging that I will come on to discuss, and potentially result in higher real interest rates than would otherwise be appropriate. And the MPC has underlined its commitment to avoiding such an outcome. 3 However, recent data have been more encouraging. And as workers become more confident over the coming years, I would expect wage growth to continue to pick up. There is already  2  Unit wage costs defined as whole economy AWE relative to GDP per worker. Latest value of 1.1%, compared to 2004-2007 average of 2.9%. 3  http://www.bankofengland.co.uk/monetarypolicy/Documents/pdf/cpiletter130515.pdf. 2  BIS central bankers’ speeches  anecdotal evidence that the tightening labour market has made recruitment and retention concerns a source of upward pressure on labour costs.

The second factor is a result of the process whereby expectations are formed and in the new Keynesian model it is represented by the term indicating inflation expectations. If there isn’t full information on the nature of the shocks and the structure of the economy or the central bank’s determination to ensure price stability, then businessmen have a long learning curve to embark on. This increases the danger that a shock that temporarily raises the inflation level, such as a major hike in oil prices, may end up gaining a foothold in inflation expectations rather than rapidly disappearing. That is why an effective monetary policy depends to a large extent on pegging those expectations to the goal of price stability. 2.3  Preferences  The third element of difference between both sides of the Atlantic can lie in the approach adopted by the central banks, which to some extent reflect also their mandate, in accordance with the institutional setup prevailing in each individual country. In the euro area, the European Central Bank’s mandate is enshrined in the Maastricht Treaty, which clearly emphasises price stability maintenance as being monetary policy’s primary goal. To support the implementation of that principle, the ECB has adopted a quantitative definition of price stability – namely, an inflation rate below but close to 2%. This facilitates learning by the 10 private sector and diminishes market uncertainty, thus promoting macroeconomic stability. This stability means that there are fewer variations in the interest rate.
The remedy would be a negotiated reconstruction of the firm’s capital structure, writing off the equity and partially converting debt claims into new equity. In the US, that goes by the name of Chapter XI. In banking, which is subject to depositor and counterparty runs, there is not time for a process involving negotiations between the different classes of creditors and shareholders under the jurisdiction of the courts. And the public policy priority is the stability of the system, not only the welfare of creditors. An administrative agency needs to make and execute some rapid judgments. That is precisely what so-called bail-in via resolution is about. The essential difference from other resolution tools is, as I have said, that losses are applied ex ante, up front rather than at the end of a process of running down the assets associated with “non-critical” functions. I have been making a simplifying assumption: one legal entity. Now imagine a cross-border group with subsidiaries in many jurisdictions and with a holding company. Under the provisions of the FSB Resolution Standard, recapitalisation through reconstruction of liabilities can also prospectively cut through a number of the long-standing impediments to resolution stemming from conflicts between home and host country insolvency laws; in other words, the cross-border problem. If the bail-in I have described were executed at the level of such a banking group’s holding company, there should in principle be no need to trigger default clauses in subsidiaries around the world that are not themselves affected by the problem causing the group’s losses.

Richard W Fisher: “Not to be used externally, but also harmful if swallowed” – projecting the future of the economy and lessons learned from Texas and Mexico Remarks by Mr Richard W Fisher, President and Chief Executive Officer of the Federal Reserve Bank of Dallas, before the Dallas Regional Chamber of Commerce, Dallas, Texas, 5 March 2012.. *  *  *  The views expressed by the author do not necessarily reflect official positions of the Federal Reserve System. I have been asked to speak about the economy. I am going to take a different approach than is typical for a Federal Reserve speech. I’ll eschew making the prototypical forecast, except to note that from my perch at the Federal Reserve Bank of Dallas, I presently see that: a.) On balance, the data indicate improving growth and prospects for job creation in 2012. However, the outlook is hardly “robust” and remains constrained by the fiscal and regulatory misfeasance of Congress and the executive branch and is subject to a now well-known, and likely well-discounted, list of possible exogenous shocks – the so-called “tail risks” – posed by possible developments of different sorts in the Middle East, Europe, China and elsewhere. And b.)
Significant representation in essential services work and insufficient access to healthcare are key factors that have contributed to these outcomes.1 The pandemic’s convergence with a moment of reckoning for the United States around racial justice makes conversations on issues like equitable growth even more important and relevant. When I think about equitable growth, I think about an economy where everyone can realize their full economic potential. While today’s conversation is about equitable recovery, everyone here is aware that an equitable economy did not exist before the pandemic. Another important dimension of equitable growth is equal access. And the pandemic exposed just how dramatic the fault lines in racial disparities are, for access to things like healthcare, credit, and housing. Recent research by the New York Fed revealed that Black-owned businesses are almost twice as likely to shutter during COVID-19 as white-owned firms. Black-owned businesses are also more likely to be located in coronavirus hot spots.2 I’m hearing about how these statistics are playing out for families through regular conversations with community leaders like many of you in our district and beyond. Far too many are facing unemployment, losing access to their healthcare, and dealing with the threat of eviction. Structural inequality stifles growth, but there is no single silver bullet that can solve the problems laid bare by the pandemic. As we look ahead to a full recovery from the downturn, we need to set a stronger foundation.

I mean no disrespect to the existing well-known rating agencies - indeed quite the contrary - when I say that the last thing the regulators would want to see is a mushrooming of untried rating agencies all clamouring for “recognition” from supervisors. We have no wish to see the supervisory net extended, 3  BIS Review 132/1999  by way of quasi-regulation, to rating agencies; nor do we wish to substitute regulatory judgements for the very satisfactory investor discipline that currently operates in the ratings arena. I note that the EU Commission’s consultative paper on reforming the EU framework goes further than the Basel Committee’s and talks of designing an internal ratings based approach that could potentially be used by all banks, not just large sophisticated ones. This makes some sound sense, since, to my mind, banks should seriously question what value-added they are bringing to the credit intermediation process if they do not have a reasonably systematic mechanism for assessing and pricing borrower risk. There are indeed various ways that an internal ratings based approach could be designed, with varying degrees of sophistication depending for instance on the number of “buckets” that are used, whether maturity is incorporated as an additional dimension, and whether the bank’s own internal estimates of loss-given-default are recognised, as well as simple default probability. We do not at this stage have a strong view as to where along this spectrum of complexity the internal ratings approach should be pitched.
I assert that there is no inherent absolute conflict – these are different elements that can be associated with a single economic equilibrium. 8 In the absence of events, random shocks or other disturbances, it would be possible to achieve that triple objective simultaneously. If that were not possible, there would be a truly deep conflict, and the only solution would be to go back to government and ask for the remits to be changed so that coherency was achieved. I see no arguments to support that. But even though the different policy objectives can be achieved simultaneously, that does not mean that each committee can ignore the others. That would only be true in a special case when use of each committee’s policy tools affected its own objectives and not those of others ie if the policy effects were perfectly independent. In practice independence is inevitably  7  With apologies to my insurance colleagues I am going to leave on one side the objective of policy holder protection. That should not affect this discussion. 8  There is an interesting longer term issue of whether stability – on any one objective, let alone all three – necessarily breeds the conditions for subsequent instability, given that humans take more risks when conditions are thought to be stable and safe. I am not going to address that issue in this lecture. BIS central bankers’ speeches  3  partial: each policy tool is likely to affect all the objectives, albeit in different degrees.

Sometimes monetary policy, micro- and macroprudential policy measures are interchangeable.8  Broad discussions on systemic risk issues are valuable To summarise, we can observe that the Riksbank is responsible for a number of areas that are central to the financial system – cash supply, the RIX system, supplying liquidity in a crisis and monetary policy. The Riksbank regularly analyses  8 See for instance, Finochariao et al, (2016) “Macroeconomic effects of reducing household debt”, Sveriges  Riksbank Economic Review 2016:2, Sveriges Riksbank, http://www.riksbank.se/Documents/Rapporter/POV/2016/2016_2/rap_pov_160922_eng.pdf for a discussion of what needs to be done with different macroprudential policy instruments and monetary policy if one needs to reduce household indebtedness, and what effects the different tools have on macro variables such as inflation and GDP. 9 [12]  the risks that could threaten the stability of the financial system to be able to manage these tasks. We therefore consider that it is also our task to contribute to the general debate in society by means of these analyses. We communicate our views in different ways, both within and outside of Sweden's borders. For instance, we have for 20 years now been publishing our assessments in Financial Stability Reports. We also regularly report our analysis of systemic risks in the Financial Stability Council and hearings of the Riksdag Committee on Finance. The Riksbank also takes part in a number of international committees and working groups where financial stability questions are discussed.
In Q2 alone, the share of non-cash payments in retail rose by 5 p.p. to almost 69%. The fact that the Russian financial sector as a whole is successfully implementing innovations does not mean that this process is proceeding evenly, or that players of different sizes are managing to move to these new rails equally as easily. On the one hand, the development of new technologies requires investment, information systems are expensive, and as Mr Aksakov also mentioned, it is necessary to think about joint systems. The Bank of Russia is certain that, this being said, small players can offer rather competitive services but to do so they need to be given access to common infrastructure solutions. This will make it possible to greatly increase competition and therefore improve conditions for consumers. That is why we created the Faster Payments System and we are developing biometrics. The Faster Payments System, incidentally, is successfully operating with a continually increasing turnover. Since the beginning of the year, the number of banks connected to the system has increased threefold to 109. The volume of transactions has increased fivefold to 307 billion rubles, and the number of operations has grown almost sixfold — 39 million transfers were made. Biometrics is developing at a slower pace. Mr Aksakov also spoke about problems in this sector and in legislation here, but this is not a reason to give up.

In other words, whilst these may be a set of more or less necessary conditions for market development, they are unlikely to prove sufficient. However good the infrastructure may be, it is the issuers, investors and financial intermediaries which eventually determine whether there is a active market or not. Here in Hong Kong the debt market has grown significantly in the recent past, and the increase in issues by non-financial corporates has been encouraging. But we cannot escape the fact that we are still a relatively small market and that, despite the increases in primary issuance, secondary activity remains subdued. “So”, people ask me, “what is the Hong Kong Monetary Authority going to do about it?” In fact I am not particularly comfortable with the implied presumption that we should be the first port of call when any problems or deficiencies are identified. Thus, while I should like to take this opportunity to explain what we are in fact doing or intending to do, I want also to indicate what, in my view, we cannot or should not do. We are involved in the working group established by the Securities and Futures Commission to review Hong Kong’s laws and regulations relating to offers of securities. Over the years, several of the procedures have become outdated or have failed adequately to accommodate market innovations. In some instances they are an obstacle to bond market development. There are some complex legal and administrative issues here, which will take time to address.