samchain/econo-pairs-v1 huggingface dataset:
M R Pridiyathorn Devakula: Economic and financial crimes - challenges to sustainable development Remarks by Mr M R Pridiyathorn Devakula, Governor of the Bank of Thailand, at the Eleventh United Nations Congress on Crime Prevention and Criminal Justice, Bangkok, 19 April 2005. *  *  *  Mr. Chairman Thank you for allowing me an opportunity to share with you some thoughts on the issue of "Economic and Financial Crimes: Challenges to Sustainable Development". From the topic of this Plenary Session, I assumed the organizer would probably want an answer as to whether economic and financial crimes are obstacles to sustainable development. The answer is a definite YES. The ultimate objective of managing the development of an economy is the well being of the people. There is little need to elaborate on how activities such as Drug trafficking, Exploitation of natural resources, Exploitation of child labour, Corruption, Misappropriation of funds from banks, Cheque or credit card fraud, Stock price manipulation, and Tax evasion affect the economic well being of the people. The message I would like to highlight today is rather that the consequences of these undesirable activities go well beyond the financial loss and the economic well being of society and the country. In my opinion, what is more important than economic well-being is the feeling of living in a fair and just society.

If drug lords continue to live well on their ill-gotten wealth, corrupt politicians continue to exert influence in the political arena, fraudulent bank executives continue to go unpunished with no loss of status, and stock price manipulators continue to get wealthier at the expense of other shareholders, people would ultimately feel that the society in which they live is unfair and unjust. This places a heavy toll on people's emotional resource and negatively affects their well-being. Thus, when economic or financial crimes are committed, it is imperative that prompt actions be taken against the perpetrators. Otherwise, people in the society would harbour negative feelings towards the government and the system. If left unchecked, their feelings of resentment and unfairness would accumulate and get bottled up. People would feel alienated, hating their own society and resenting the government. The feeling that one lives in a fair and just society is as important as, or even more important than the economic well-being. If the public feel void of this social well-being, they will feel thoroughly disheartened, unwilling to be good law-abiding citizens, unwilling to invest, unwilling to contribute to the society they live in. So, the question is how do we prevent this feeling from deepening such that it erodes the confidence and trust in the democracy and the government. What differentiates a "normal crime" from an "economic crime" is that the harmful consequences of a normal crime, which directly affects people's lives and properties, can be easily felt and observed.
On the other hand, continued relatively low unemployment in Norway will contribute to pushing up wage growth. Wage growth is projected to increase to 4¼ per cent in 2010, rising further to 4¾ per cent towards the end of the projection period. The severe cyclical downturn and the decline in commodity prices have resulted in very low consumer price inflation in many countries. The year-on-year change in consumer prices is negative in the US, the euro area, Sweden, Japan and China. Core inflation is more stable, but has also edged down recently. Moderate growth prospects and lower-than-normal capacity utilisation in most advanced economies will lead to low consumer price inflation among our main trading partners throughout the projection period. The key policy rate was reduced to prevent inflation from falling too far below target and to mitigate the impact of the global downturn on the Norwegian economy. Underlying consumer price inflation in Norway has slowed in recent months to an estimated rate of just below 2½ per cent, reflecting the effects of lower wage growth, reduced capacity utilisation in the Norwegian economy and low inflation abroad. Although the krone depreciation last autumn has pushed up import prices, the effect of the depreciation is probably now waning. BIS Review 139/2009  13  After a period of falling productivity, unit labour costs are high. The projections are based on an increase in firms’ margins ahead through an increase in prices.

Overall, the outlook and the balance of risks suggest that the key policy rate should be gradually increased in the period ahead. The projections are uncertain. New information may reveal aspects of economic developments that suggest the Norwegian economy is following a different path than projected. Higher capacity utilisation or a weaker krone may, on the one hand, result in higher-than-projected inflation. On the other hand, inflation may be lower than projected if the krone remains strong or productivity picks up more rapidly. Should the krone appreciate considerably more than projected, the interest rate may be increased to a lesser extent or later than currently envisaged. The key policy rate should be in the interval 1¼-2¼ per cent in the period to the publication of the next Monetary Policy Report on 24 March 2010 unless the Norwegian economy is exposed to new major shocks. Thank you for your attention. BIS Review 139/2009  15
Probably, the first step is to disclose data, provide information on green social bonds the committees shall offer to market participants. These standards will become effective in autumn 2021. In addition, we are currently developing the rules for verifying financial ESG instruments. Cyber security which has been mentioned by Anatoly Aksakov is also a critical topic that will become increasingly important. Information security is essential in the conditions of digitisation as a key trend impacting the financial industry. Overall, the issue of operational risks and cyber risk resilience will certainly be in the focus of our attention. In this regard, we will be developing an adequate approach to assessing these risks, working jointly with you, so as to ensure banks’ resilience to them. Among other things, it is possible to create joint market-based infrastructure solutions. Wrapping up, I would like to say that, despite the problems and challenges that are important for banks and the regulator, we believe that banks really made their best last year in terms of both their own robustness, so to say, fire resistance at the moment they had to face the crisis, and the support they provided to their clients. The crisis will be over, while these two components will remain as significant.

Simply put, a CTC could not claim tax deduction for interest paid to fund providers within the group as expenses, but all its interest income was subject to profits tax. This tax asymmetry greatly diminished the attractiveness of Hong Kong as a CTC hub, especially as our main competitors in the region and elsewhere do not seem to have this problem. 4. When faced with this possible deal breaker in our effort to promote Hong Kong as the CTC hub, what did we do? Rule number two in marketing: you cannot do good marketing if the product is not a good one. You can only fool some people some of the time but not for long. So one has to make good a product if it is found defective or inferior. Thanks to the help from the TMA, we formed a working group to study the problem and make recommendations to remove the obstacles undermining Hong Kong’s development as a CTC hub. We made a report to the Financial Secretary and obtained his support to change this tax anomaly. With the support of the Financial Services and the Treasury Bureau (FSTB) and the Inland Revenue Department (IRD), and in consultation with the industry, we managed to pass the legislative amendments to remove the tax asymmetry in May 2016. In addition, the Government has gone one step further by providing additional tax incentive by halving the profits tax rate payable on specified CTC activities in Hong Kong from 16.5% to 8.25%.
Lehman’s decline The New York Fed had no role in supervising Lehman Brothers. The SEC supervised Lehman’s broker-dealer pursuant to express statutory authority, and, as Chairman Mary Shapiro pointed out in her testimony before the House Financial Services Committee, the SEC also supervised Lehman’s parent holding company under a voluntary program called  BIS Review 112/2010  1  the Consolidated Supervised Entity (CSE) program. 1 The Federal Reserve had a business relationship with Lehman’s broker-dealer, but our transactions with the broker-dealer were for the most part repurchase agreements done for monetary policy purposes, and purchases and sales of Treasury and agency securities. In March, events in our financial system caused several responses that expanded the Federal Reserve’s business relationship with Lehman Brothers and certain other investment banks. First, the Federal Reserve announced, on March 11, 2008, what became known as the Term Securities Lending Facility (TSLF). The TSLF was designed to address a liquidity problem that we had observed with respect to certain types of mortgage-backed securities. The TSLF addressed this problem by enabling primary dealers to borrow from the Federal Reserve certain securities that they could more easily exchange for cash and secure these borrowings by pledging securities to the Federal Reserve that were less easy to exchange. This enabled the primary dealers to obtain much-needed liquidity from the market. Second, at around the time this program was announced, one of the primary dealers, Bear Stearns, was experiencing an extraordinary liquidity run.

5 In the end, the rescue failed because we had no willing and capable merger partner able to provide the necessary commitments to stabilize Lehman. And, lest there is confusion on the point, this would be true no matter who was financing the acquisition of Lehman’s illiquid assets, the counterparties or the New York Fed. As of that Friday, there were two prospective Lehman acquirers: Bank of America and Barclays. On Saturday, September 13, Bank of America abandoned the potential acquisition of Lehman and reached an agreement to acquire Merrill Lynch. Barclays was the only remaining suitor. On Sunday, September 14, with the consortium financing committed, we learned for the first time that Barclays would not be able to deliver a key document to carry the merger to conclusion: a guarantee of Lehman’s trading obligations between the signing of the merger agreement and its closing. The Bear Stearns transaction taught us the importance of the guarantee to a successful rescue. A guarantee maintains the ability of the troubled company to operate as a going concern and, thus, preserves value. It does this by providing protection to counterparties during an especially vulnerable period – the period between merger contract and merger closing. Without such a guarantee, the creditors and counterparties of the firm would be at risk in the event that the merger fell apart because of a failed shareholder vote or some other contingency. Consequently, as a market matter, the guarantee is an indispensable part of any such rescue operation.
The second broad area of opportunity in a post-LIBOR world comes from the potential for concentrating sterling liquidity into a single interest rate curve referencing compounded overnight SONIA. Today, someone managing a portfolio of sterling interest rate risk can easily find themselves having to deal with multiple different reference curves, each based on a different interest rate index. Figure 3 illustrates five commonly-traded curves (based on SONIA and the one, three, six and twelve month LIBOR fixings) at the start of August 2017 (shortly after Andrew Bailey’s 2017 speech announcing the 2021 deadline for LIBOR transition). Figure 3: Zero coupon swap yield curves (as of 1 August 2017)  Source: Bloomberg data and Bank calculations 7  All speeches are available online at www.bankofengland.co.uk/news/speeches  7  It is challenging enough to manage five or more different interest rate levels. But, to make matters worse, the gaps between these curves – so-called ‘basis’ – can also change quite sharply over time, reflecting variations in the credit premium associated with different lending tenors, structural flows, and other factors. Figure 4 illustrates how the basis between a three year sterling swap referencing the 6 month LIBOR fixing and three swaps referencing 1, 3 and 12 month fixings has moved since 2008. Managing interest rate risk in the presence of such movements is a risky and administratively complex process.

Figure 4: Basis between index tenors for a three year £ swap  Source: Bloomberg data and Bank calculations  LIBOR transition, if executed effectively, offers the prospect of concentrating the liquidity currently split across these multiple curves into a single SONIA curve, providing a materially deeper, more transparent and less complex single market in which to hedge interest rate risk. Unlike some other currencies involved in LIBOR transition, sterling starts with the distinct advantage of already having a liquid, well-traded SONIA curve at shorter maturities based on OIS swaps, supplemented by three futures contracts which also settle on realised compounded SONIA. Rolling the liquidity currently in term LIBOR curves into this curve would further improve price formation at the short end and, importantly, improve the definition of the curve at longer maturities too.
First question would be, what do you think of this type of proposal? And second, if this were implemented, what do you forecast the impact to be? 11 / 13  BIS central bankers' speeches  President Dudley: Well, there’s been a lot of discussion in Washington about this border tax adjustment. If you were starting with a corporate tax code from scratch, it would be, I think, quite attractive in a lot of ways because it basically eliminates a lot of the incentives to engage in games of transfer pricing. It reduces a lot of the incentives to book your intellectual property abroad. So, it actually has a lot of attractive features. I think the challenge is that it’s very different than the current tax regime, and so there really would be some pretty significant adjustment costs and frictions of moving from the current regime to that new regime. And so, I think the question is really going to be: do people think those adjustment costs are a price worth paying for what I would agree is probably a better corporate tax regime. Certainly, a much better tax regime than the one we have today. But you know, there’s going to be a lot of people that are going to be worried about how that adjustment is going to affect their particular industry. If you’re an importer, you’re going to be worried that your price of imports is going to go up.

In the long run, even savers would be better off in a world in which aggressive monetary policy generates a strengthening recovery that eventually permits the normalization of interest rates, than they would be compared to a circumstance in which the United States allowed itself to fall into a Japan-style trap of low growth and low rates for decades. So I do not view the effect of low rates on savers as a reason to be less accommodative. Rather, in my view, the potential for the monetary policy impulse to be attenuated over time, is an additional reason to be aggressive in terms of the policy response. A more front-loaded program would avoid greater attenuation compared with a policy that started out less aggressive but added stimulus gradually over time. This has two benefits. First, it would likely be more successful in generating the desired recovery more quickly. Second, relative to a more back-loaded program, less would ultimately need to be done to achieve the desired set of outcomes. The fact that there are asymmetric payoffs from an economy that is weaker than expected versus one that is stronger than expected, given that we are at the zero lower bound reinforces this conclusion. In particular, if the economy were to continue to underperform, and experienced a severe shock, there would be some risk of getting stuck in a deflationary situation in which monetary policy would be even less effective.
Rapid demand growth; commodity price volatility; the influence of a broad range of global conditions on wages: all these factors can trigger large changes in relative prices, and this makes the job of capturing underlying inflation harder. So we have to be careful not to focus too narrowly on one particular measure. Instead we need to look at many. And indeed here in the United States we look at a range of different measures of core inflation, for example, that take energy and food prices out of the overall index. We look at these over different time horizons. We look at a variety of other measures that use different statistical techniques to strip out the more volatile parts of the index. These all have limitations, and their relative merits may change over time. Central banks approach this challenge of capturing underlying inflation differently, but ultimately we are all judged by what happens to overall inflation over time. These issues are common to central banks everywhere. But economic and financial integration has brought particular challenges for monetary policy makers in emerging market economies. The broad pattern of exchange rate and monetary policy regimes in emerging market economies has shifted dramatically over the past decade. Most now operate a more flexible exchange rate regime, though a significant number have moved to the opposite extreme, relinquishing monetary sovereignty in favor of full monetary integration.

As economies become more open, external developments inevitably affect price and output dynamics. The world may thus be more complex and, in some respects the conduct of monetary policy may be more challenging. The external factors that have in recent years had a dampening impact on domestic inflation could, at some point, fade or reverse. And the forces that have produced this constellation of capital flows and market conditions will evolve in ways we cannot anticipate. This obliges policymakers to devote more care to the process of understanding how change in the world affects the balance of opportunity, risk and uncertainty confronting policymakers. And it probably makes more compelling the importance of preserving confidence in our commitment to keep inflation low and stable, so that we have the flexibility to respond to this changing world. BIS Review 102/2006  3  Ultimately, as Mervyn King, the Governor of the Bank of England, noted recently, inflation is made at home and has to be contained at home. So integration does not, and should not, limit our ability to achieve our objectives. Rather, it forces us to think harder about how our economies are evolving and how developments in the rest of the world affect our markets. Thank you. 4  BIS Review 102/2006
I have no doubt about the parties’ insight into the importance of the inflation target for wage formation in general. However, most agreements expire next year. It has proven during the autumn that the majority of the teacher training places in the sciences and mathematics are vacant. This is not so strange since a person who can successfully study mathematics and physics at university can also become a graduate engineer or industrialist scientist. Initial salaries between a graduate engineer and a science teacher differ by SEK3-4,000. Salaries for a competent engineer have no ceiling while for a teacher the top salary is not much above SEK20,000. Teachers have not been slow to make use of the scarcity of certain categories of teachers to demand 15% more than all other groups over a 5-year period, despite there not being a shortage of all categories of teachers. This has naturally led to protest from the Swedish Trade Union Confederation. 3  BIS Review 126/1999  If this type of imbalance cannot be dealt with by the union organisations and employers without a general scramble for pay increases, the Riksbank will be confronted by the unpleasant task of constraining the economy in order to prevent excessively high wage increases having an impact on inflation. The low inflation policy may therefore be said to be confronted by a test: the labour market is improving with falling unemployment and increasing capacity use otherwise.

In this way, the period of growth can probably be extended for several years and the employment ratio can also increase markedly then. Difficult balance to strike for monetary policy The Riksbank must strike a balance in monetary policy so that growth is not dampened unnecessarily but neither becomes so strong that inflation accelerates. The difficulties lie in foreseeing the growth of demand and its relation to inflation over a period of a couple of years to come. A change in interest rates actually has an effect with a considerable time lag, its full impact only being felt after a couple of years. If changes in interest rates come too late, the consequences will be unnecessarily large fluctuations in growth. However, experience shows that if inflation is allowed to rise, there is a great risk that the higher inflation will persist and that inflation expectations will be driven up. The consequence of the Riksbank’s “wait-and-see” standpoint would therefore be to imperil the credibility that has been laboriously achieved - or even lose it. Considerably greater restraint would then be required than if inflation had been stopped in time. In order to avoid this, the Riksbank may need to 1  BIS Review 126/1999  increase interest rates before registered inflation shows signs of increasing, which will confront us with an educational problem. If the Riksbank wishes to safeguard growth, employment, and a high use of resources in other respects, monetary policy must be adapted in time.
G  I’m pleased to say that, through the Committee’s efforts and the cooperation and support of other supervisors and the industry, it appears that the proposed framework will attain each goal. We can now count them among the milestones we've achieved. •  However, though we have covered quite a bit of territory over the past three years, the last miles of any marathon are the toughest to finish. I’d like to turn now to the status of the New Accord and of the issues we are still resolving. •  Since the Second Consultative Document’s release 21 months ago, the members of the Basel Committee have worked collaboratively and publicly with supervisors, banks, and others to revise the proposals so that they best serve the needs of modern banking. We’ve published and discussed thousands of pages of proposals and studies with the industry and the public. I’d like to share with you the latest news on how we are resolving the key challenges and concerns that have surfaced in this process. •  One general issue raised is that the New Accord’s increased sensitivity to risk will reinforce procyclical behavior by banks, leading to increased cost of credit during cyclical downturns. While we are working to address this concern, I would note that banks already are expected to operate above minimum capital requirements, manage to their economic capital needs, and evaluate how their risk profiles may change over time.

On the contrary, what is important to bear in mind is that by ensuring a stable price and financial environment, the central bank helps foster economic growth. I believe that no central bank can maintain price stability over the longer term without public support for the necessary policies. Only with the confidence of the public in their policies and their own lasting dedication to non-inflationary growth together with a well-functioning financial system can central banks succeed in achieving and maintaining price and financial stability. BIS Review 17/1997