samchain/econo-pairs-v1 huggingface dataset:
The emergence of the City owed a good deal to Britain’s earlier position as the world’s leading industrial and trading nation and international power. But that does not explain its continuing strength. To explain that there are lots of factors one might point to - the English language, the European time zone, the sheer momentum of the City’s critical mass, supported by the availability of a professionally-qualified and technically-skilled work force which gives the City remarkable resilience and flexibility, aspects of our commercial and physical infrastructure, and so on. All of these factors are certainly relevant factors. But if I had to identify one factor above all that helped to explain the continuing phenomenon of the City, it would be what I can only rather vaguely describe as the surrounding ethos of a free, competitive, market place. I do not at all mean by that that the City is a lawless jungle where anything goes! In fact quite the reverse. You cannot have an effective competitive market without reasonably clear rules of the game, both to protect society as a whole from disruption and to retain the confidence of both the providers and users of the market by ensuring that they know what is expected of them and what they can  1  BIS Review 134/1999  reasonably expect of others.

The evolving legal and regulatory framework in this country, together with the self-regulatory disciplines applied by the relevant market organisations and professional bodies have been - and remain - a vitally important asset for the City in this context. It is not just the structure of these arrangements but their substance and the manner of application of the rules of the game that matters. It is all too easy to err on either side. The rules may be so loosely drawn that market participants and market users lose confidence and go elsewhere; or they may be so tightly drawn that they discourage competition and inhibit innovation. Equally, the actual, as distinct from the intended, balance between social protection and fairness on the one hand, and competition on the other, may be affected by the approach adopted by the various arbitrators. Theirs is a difficult job at the best of times. We’ve all seen matches ruined by either unduly lax or unduly officious refereeing. But ultimately the character of the game depends upon the self-discipline, as well as the skills, of the players. In general I believe that we in this country have been well served in these respects. There has been relatively little systemic disturbance in recent years, and what there has been has required relatively modest commitment of public funds. There have, it is true, been periodic concerns about business behaviour.
Although this split had its merits historically, the changing scale, nature and sophistication of cyber and other threats to the stability of payment systems mean there is a compelling financial stability case for being able to provide end-to-end risk management within one organisation. In recent months the Bank has worked closely with the shareholders, users, management and staff of CHAPS Co to bring about a smooth and orderly transition and avoid any disruption to the service provided. On Monday last week, former CHAPS Co staff took their new seats in the Bank of England, and by 7am more than 22,000 transactions had been completed on the Bank’s infrastructure with a value of £ In the first week, approximately 862,000 transactions were completed, with a value of £ including wholesale  5  Bailey (2017) 10  All speeches are available online at www.bankofengland.co.uk/speeches  10  interbank payments, mortgages, company invoices and much more. In short, it was business as usual for banks and their customers. Like our administration of SONIA the combined RTGS and CHAPS service will benefit from best practice governance arrangements, including a new Board which will meet for the first time in December, chaired by me and with four independent members recruited through a competitive process. We will also continue to benefit from the voice of CHAPS users, through the establishment of a new Strategic Advisory Forum for senior industry representatives. Conclusion  Let me recap on how I see end to end monetary policy.

Sixth, the MMLR should avoid propping up markets that would not be fundamentally viable once peacetime returns. I must stress that those are just starters for debate. But, unfortunately, we cannot always wait for consensus around fully articulated principles. Recently, in the context of its Asset-Purchase Facility programme, the Bank of England has embarked on what could, perhaps, be viewed as two variants of MMLR in the sterling corporate financing markets. Both have been focused on our being a buyer, rather than operating on both sides of the market, but arguably that is what the various MMLR ideas really amount to in crisis conditions. In the first, we offer to buy Commercial Paper at announced spreads, which are designed to be above those warranted by credit-fundamentals, and above market spreads during peacetime, but below those prevailing in the market before we stepped in. In other words, we are ready to lend without charging a hefty liquidity premium, since we are not liquidity constrained. We offer to buy paper in both the primary market and the secondary market. The latter is in effect a temporary liquidity facility to money market funds and others, at an extra cost of 25bp over the fixed spread, and with the aim of increasing their willingness to buy new paper. The goal has been to stimulate the market to bring market prices to at least our spreads, with market transactions occurring there or more cheaply.
The euro area-wide unemployment rate has fallen to 8.7%, compared with levels close to 13% at the height of the crisis, although there are substantial cross-country differences, ranging from an unemployment rate below 4% in Germany to 20% in Greece and 16.5% in Spain. Moreover, a balanced pattern of economic growth can be seen. Adding more recently to the momentum of private consumption, the sole engine of growth of the start of the recovery, has been the dynamism of business investment. Low financing costs, the sound performance of final demand and high capacity utilisation are enabling investment to pick up to pre-crisis levels. However, factors persist that might restrict medium-term investment projects, including most notably low potential growth expectations, the adjustment of balance sheets and the correction of high corporate debt levels still under way, and the problems that are creating political uncertainty. Euro area exports, boosted by more buoyant global trade, are also contributing to the momentum of activity. And this despite the notable appreciation of the euro since last spring. Undoubtedly, a significant factor underpinning the recovery has been the maintenance of an expansionary monetary policy, which has allowed financing conditions to be relaxed, contributing to the upholding of both private consumption and the recovery in investment. Specifically, estimates by the Banco de España suggest that the series of monetary policy measures adopted since mid-2014 might account for close to half of the nominal GDP growth in the euro area from 2015 to 2017.

18  History suggests each of these capitals may have played an important supporting role in the story of growth. Ideas alone, without the support of one or more of these broader capitals, have historically run aground. For example, in the UK many of the foundations for growth after the Industrial Revolution were laid in the centuries preceding it. It was on this platform of “capitals”, plural, that ideas and innovation then built. Take human capital. The most dramatic improvements in educational standards in the UK occurred prior to 1750 (Chart 3). So too did the largest improvements in measures of social, infrastructural and institutional capital. 19  Ideas needed these foundations to flourish. A steam engine is not much use without the skills to  build it, the tracks to run it on, the institutions to oversee it, the trust of the public to accept it. The causes of th  the growth inflexion in 18 century England were as much sociological as technological. Another lens through which to view this alternative growth story has recently been provided by economic historians, Steve Broadberry and John Wallis. 20  Indeed it was probably this lens on the world, above all  others, that led me to change my own story about growth. Broadberry and Wallis do two things. First, they construct some new estimates of growth going back to 1300. Rather than relying on period averages, they use higher-frequency measures of growth. This changes the growth picture significantly.
07.05.2019  Challenges for the Spanish economy. Productivity and the business sector Assembly of the Instituto de la Empresa Familiar Pablo Hernández de Cos Governor  Good morning. Let me begin by thanking the Instituto de la Empresa Familiar (IEF) for their kind invitation to take part in their Annual Assembly. Throughout its 25-year history, the IEF has not only played a crucial role in disseminating studies on the reality of and the challenges facing family businesses in our country, but has also fostered debate on many economic aspects of general interest. One recent example is its interesting publication on dual training on its website.1 In my address today I shall, after briefly describing the current economic setting, mainly analyse the principal challenges facing our economy in the medium and long term. I will particularly focus on productivity, the main determinant of economic growth in the long run. In Spain’s case, productivity dynamics have been particularly poor in recent decades. Improving them with a view to the future is, therefore, a prerequisite for achieving sustainable and balanced growth in the long term. The economic situation  After averaging growth of around 3% in the three years from 2015 to 2017, the pace of the Spanish economy eased somewhat last year to annual growth of 2.6%. 1  See the study by Instituto de Empresa Familiar (2018) “Orientación profesional y formación dual. Hacia un modelo integrado para el empleo juvenil”.

5  See Zamarro, G., C. Hitt and I. Mendez (2016) “When Students Don't Care: Reexamining International Differences in Achievement and Non-Cognitive Skills” EDRE Working Paper No. 2016-18. 14/18  The first papers to have evaluated this experience in Spain do not offer conclusive findings. And that underscores the challenge of adapting another country’s successful model to our circumstances.6 It is therefore important to conduct pilot programmes enabling us to determine which design is most suitable for us. Also, in addition to improving employee training, it is important that such training should be in an innovative environment. In this respect, investment in R+D activities in Spain is still very low in the public and private domains alike (0.8% and 1.4% of GDP, respectively, in 2016), which places Spain at levels 25% and 50% below the European average. As a result, the technological capital gap with the EU has continued to widen. Here several measures, among others, would be advisable: to evaluate the possibility of increasing the public funds allocated to the area of innovation; to change research promotion and career arrangements to facilitate the entry and development of new highpotential researchers; to restructure in their entirety public organisations that pursue innovation in order to harness synergies where they may be found; and to promote a sound evaluation system to determine the allocation of resources across centres.7 Business financing  6  See Bentolila, S., A. Cabrales and M. Jansen (2018): “Market insertion of youth: Evidence from Madrid”, Working Paper, forthcoming.
4  BIS Review 17/2002  Largely as a result of these differences in the response of internal costs, Hong Kong managed to recoup all of the lost competitiveness (as measured by the real exchange rate), which had amounted to about 15%, but Argentina failed to achieve any lasting recovery; indeed, loss of competitiveness resumed, long before lost ground had been recovered. In view of this evident flexibility in Hong Kong, to what extent is it therefore correct to talk of the peg imposing some sort of rigidity on the economy? In the strict sense of the word, there is of course some rigidity, because, even with speedy and flexible adjustments of domestic costs, the correction of these which may be needed to offset a shock to the nominal exchange rate cannot be instantaneous. But if this rigidity is judged against how other economies might or do fare under fixed rates, Hong Kong emerges rather favourably. And, when compared with the alternative of floating, it is by no mean  BIS Review 17/2002  5  obvious that the peg delivers an inferior result for Hong Kong, given the possibility of volatility or overshooting under floating, especially for a small and highly exposed economy. Indeed, although it is always difficult to predict events in hypothetical circumstances, there is a concern that a more flexible regime would, rather than liberating monetary policy, actually pose more problems - especially in the short term as confidence would have to be re-established and might remain more brittle.

Even if the central bank could, through intervention in the foreign exchange market or actions to influence domestic interest rates, fix the nominal exchange rate at some particular level, and even if it succeeded in fixing not simply the bilateral rate but the trade-weighted rate, this would only determine the real rate for the short term. This is because any monetary policy actions, such as exchange market intervention or changes in interest rates, in due course have a feedback effect on domestic inflation. More specifically for example, depreciation tends to raise prices. In a market-based economy the central bank, if it already uses monetary policy to set the nominal exchange rate, cannot separately control inflation. Eventually any initial gain in competitiveness from depreciation is offset by the inflationary feedback, most obviously so in highly import-dependent economies such as Hong Kong. Empirical studies do not reject the hypothesis that this feedback is eventually 100%, although the full offset may occur only after a considerable lapse of time. Meanwhile the real rate is also affected by movements in price levels in other economies, which lie beyond the home central bank's influence. In sum, the central bank cannot, except perhaps for the short term, dictate the real exchange rate. Equilibrium of the real rate The second misconception about the real exchange rate is that a weak rate (if it could somehow be arranged) would necessarily be a good thing, because of the benefit which an improvement in competitiveness, thus measured, would bring to the economy.
However, we should not forget that the real economy and the financial economy are largely two sides of the same coin. Without one, the other would not exist. Financing is a key element for economic activity, and channelling such financing is precisely where we need the banking sector. We have once again been able to witness this owing to COVID-19. As you will recall, the financial sector was declared an essential service during the lockdown. And, for example, without banks’ active participation, it would not have been possible to successfully structure the ICO guarantees programme. Naturally, mobilising the resources needed for this transformation, which the law estimates at around € billion, will necessarily involve public-private investment formulas in which banks will no doubt play a key role. As you can imagine, financing these public-private investment needs is reason enough for the banking system to become involved. But initiatives such as the climate agreement signed on the occasion of the COP25 and the launch of FinResp (Centre for Responsible and Sustainable Finances) show that the sector is clearly committed. How can the financial economy contribute to switching the real economy towards full decarbonisation? The response is straightforward: through correct risk measurement. When banks manage their risks properly, they are promoting the effective allocation of available economic resources, by distinguishing between those projects more likely to succeed and those not viable in the medium term.

Margarita Delgado: Role of the financial sphere in accelerating decarbonisation Speech by Ms Margarita Delgado, Deputy Governor of the Bank of Spain, at an event jointly organised by the Bank of Spain, the World Wide Fund for Nature, the Ministry for the Economy and the Ministry for the Ecological Transition and the Demographic Challenge, 3 December 2020. * * * Good morning, and thank you all for being here, whether in person or online, attending this event jointly organised by the Banco de España, the World Wide Fund for Nature, the Ministry for the Economy and the Ministry for the Ecological Transition and the Demographic Challenge, which aims to boost the role of the financial sphere in the process of decarbonisation. The transformation of our economy into a more sustainable model is an unavoidable necessity to which we have committed ourselves as a society and which we have agreed with our European partners. The draft climate change law includes a set of measures that essentially impact what we call the real economy. There are references to the role of the financial sector in just a couple of its articles. A priori, that would seem natural and logical. Evidently, the CO2 reduction targets directly affect energy production, transport, mining and industrial processes in general. But anybody might well consider that the effects on the services sector or, of course, the banking industry should not be so significant.
I would then like to turn to the opposite question: whether in some circumstances the new proposals will achieve too much risk sensitivity, and to discuss this question in the context of the debate about whether internal ratings will amplify procyclicality. I shall also say something about the implications of this for lending to small and medium-sized companies. Finally I would like to end by saying a few words about forward-looking provisioning and liquidity. These are, to my mind, important adjuncts to the regulation of capital and it is important that they are not overlooked in the current focus on capital adequacy. Risk sensitivity in the new Accord The common theme behind the revisions to the Basel Accord is greater risk sensitivity. This is a move we strongly support; risk insensitive capital requirements lead to some very perverse incentives and have contributed to a number of real-world problems. This has been less the case in this country, where of course the FSA supplements the crude minimum Basel requirement with tailored capital ratios, than in some other countries, but we have not been immune even in the UK. Certainly I wonder if over-investment in highly-speculative real estate development, a common precursor to a number of banking crises, would have been quite so prevalent if capital requirements had better reflected the often-volatile nature of such lending.

On the one hand, the objective has been to provide in the new Accord a significant expansion, within a menu approach, to the recognition of collateral, credit derivatives and guarantees. But this is balanced on the other hand by specifying legal and operational standards that must be met before relief is granted and setting capital requirements against residual risks. This may - indeed is intended to - lead to much greater incentives to acquire good quality collateral and other credit insurance. This will be positive, provided the necessary operational standards including legal robustness are observed, and provided, as I said on another recent occasion, that the processes, volumes, and end results of transfers of credit risk are reasonably transparent. I am aware, however, that some initial comment from the banking industry is that the Committee has not afforded enough recognition to physical collateral, particularly under the standard and 'foundation IRB' approaches. In this respect they think the Committee achieved too little risk sensitivity. The idea of a consultation paper is to elicit comment, but there are problems with the recognition of physical collateral that need to be considered. One is the difficulty of pinpointing accurate valuations for such collateral - much of it does not have anything by way of a valuation history. And values for physical collateral are also likely to be cyclical. When manufacturing companies are in recession, the values of related assets - plant and machinery or inventories - are likely to suffer too.
The number of surfers is measured by Sifo Research & Consulting; the figures for September this year show that almost 3.5 million people in Sweden surfed, which is not quite half of the population aged 12 to 79. Of these, as many as 2 million stated that they surfed on a daily basis. Another noteworthy figure is that in the age group 50 to 79 years, almost 20% are active users of the Internet. So the Internet is not something that only young people find attractive. Furthermore, Sweden is one of the absolute leaders in information technology (IT), both as regards Internet users and in broader terms such as the number of computers and mobile phones. In such surveys, the United States usually comes out top. The Internet makes it simple to obtain information, communicate with others and trade in goods and services. Price comparisons are already feasible and one can buy some goods and services, not least bank services. In these ways the Internet cuts distances, overcomes borders, contributes to a more competitive environment and enables consumers to be better informed. Everyone can get the information he or she needs, easily and painlessly, often dispensing with intermediaries. Besides affecting consumer behaviour, the Internet and information technology in general have consequences for production processes. In addition to more informed consumers, we have firms with a better oversight of production, material inputs, distribution processes and sales.

First, quantitative easing, through the purchase of public and private debt, seeks to extend the effects of low short-term interest rates to the rest of the yield curve, including to longterm rates, over which monetary policy normally has no direct influence. To do this, the central bank purchases assets with long-term maturities, generating an increase in their price, or, tantamount to this, a reduction in their yields. These lower yields on the assets acquired by the central bank are in turn partly passed through to the yields on assets with a similar duration, such as the interest rates on bank loans, which tend to be the most relevant ones for the saving and investment decisions of households and firms, thus stimulating demand and price rises. Second, forward guidance seeks to transmit to private agents the central bank’s commitment to maintaining an expansionary monetary policy throughout the early stages of the recovery, in order to avoid the deanchoring of inflation expectations. These programmes, whose application has involved major challenges for central banks given the lack of any similar experience in the past, seem to be working acceptably well, assisting the economic recovery and avoiding the emergence of crisis-induced deflationary pressures. According to analysis carried out by the Banco de España, ECB action can explain around half of the nominal GDP growth in the euro area over the period 2015-2017. That said, it is important to stress that central banks cannot take sole responsibility for the recovery.