samchain/econo-pairs-v1 huggingface dataset:
The need to find a buyer to replace a seller can be expressed in the equivalent statement that the maturity of the liability is extremely long, in this case indefinite. The real problems stem from liabilities with very short maturities. These occur with debt finance, whether in terms of bank deposits payable on demand or longer-term debt finance which has almost run to maturity. In these cases, depositors who wish to withdraw their funds do not have to find replacement depositors. They simply take their funds out. The result is that, if this rush to the exit is on a sufficiently large scale, banks find themselves on the receiving end of a liquidity run. Such runs can occur even if the fundamentals are sound, although they are more likely when the fundamentals are weak. And the banking systems of some emerging markets compounded the problem by borrowing in foreign currency at short maturities and investing the proceeds in domestic currency assets at longer maturities. This was indeed a recipe for instability. The importance of short-term debt finance in the reversal of capital flows in recent years is clear. Virtually the whole of the $ billion reversal of flows to the five Asian crisis countries was accounted for by swings in short-term debt finance. And 80% of this swing resulted from changes in the net flow of finance from commercial banks.

So much so, that their journey towards an open capital market has seemed, at times, a nightmare. The core of the problems faced by a number of emerging markets has been the sharp reversal of capital flows. Between 1996 and 1998, the reversal of capital flows to the five Asian countries primarily affected (Korea, Thailand, Indonesia, Malaysia and the Philippines) was of the order of $ billion, equivalent to 12% of the pre-crisis level of GDP. These reversals imply equal and opposite swings in the current account. To turn a large current account deficit into a substantial surplus within two years almost certainly requires a recession. In 1998 real GDP fell by 6% in Korea, by 9% in Thailand, by 14% in Indonesia, by 7% in Malaysia and by 1% in the Philippines. Moreover, the reversal of capital flows to emerging markets means that the industrialised countries must in aggregate run a larger trade deficit. The distribution of that increase in the collective deficit has already led to a debate about domestic policy, making it harder to resist the ever present protectionist pressures, especially in election years. So rapid reversals of capital flows bring substantial economic costs. Capital flows also bring real economic benefits. They enable savings in one country to finance more profitable investment in another. That was a key feature of the world economy in the nineteenth century. Such flows also facilitate the transfer of knowledge and expertise.
But more fundamentally, to be successful, we and the new payments regulator will need to extend the cooperative working relationship we already enjoy in other areas to payment matters. Let me stop at this point: I have tried to draw out some of the idiosyncrasies of the payments environment in the UK and the highlights of our recent and prospective work to protect the resilience of our core sterling payment systems. Hopefully there have been some relevant crossovers to the Canadian context, which are helpful for today’s deliberations. BIS central bankers’ speeches  5

5  In this regard, given that more analysis is needed before we have better answers for the implications of climate change on the economy and on monetary policy, our first objective should be to step up our efforts, as both the Banco de España and the Eurosystem are doing, to develop the tools and models needed for such an analysis. In addition, fully incorporating climate risks into our internal risk management may well collaborate to expand our ability to deliver on our price stability mandate. Climate change will indeed affect the risks of the assets held on our balance sheets. Monetary policy implementation exposes us to such risks directly through holdings of assets and indirectly through collateral pledged by counterparties. Therefore, and very much related to my previous comments on the implications of climate change for the financial sector, we should take due consideration to the appropriate assessment of climate risks in the overall risk management of our stock of assets and also on the specific criteria for new purchases in asset purchase programs. For example, one step would be to introduce climate-related disclosure requirements in order for an issue or issuer to be eligible for purchases. Another one would be to expand the use of ratings that adequately include in their methodologies the impact of climate risks in the financial profile of issuers or specific issues.
John C Williams: A bedrock commitment to price stability Remarks by Mr John C Williams, President and Chief Executive Officer of the Federal Reserve Bank of New York, at the2022 US Hispanic Chamber of Commerce National Conference, Phoenix, Arizona, 3 October 2022. ***  As prepared for delivery Thank you for that kind introduction. I'm so pleased to join you today. As business leaders and business owners, you are integral to the U.S. economy. So, it's fitting for me to have this opportunity to talk to you about the state of our economy, as well as a topic that's on everyone's mind: inflation. From Main Street to Wall Street-and to Liberty Street, where the New York Fed is headquartered-inflation is the No. 1 concern. Clearly, inflation is far too high, and persistently high inflation undermines the ability of our economy to perform at its full potential. The Federal Reserve has two goals: maximum employment and price stability. History teaches us that price stability is essential to achieving maximum employment over the longer term. We at the Federal Reserve are therefore taking strong actions to restore price stability as a foundation for sustained economic prosperity. Today I will talk about why high inflation broke out last year, how it has evolved, and why I am confident that we are taking the necessary actions to bring inflation down.

In addition, there are increased concerns about financial and foreign exchange market stability in the event of a sudden reversal of capital inflows to the regional banking system. Recently dramatic changes are occurring in the global economic environment, including continuing monetary policy normalization by the U.S. Federal Reserve. These changes can potentially impact small, open economies and must be understood. Research conducted by the central Bank of Italy (BdI) is another example of research work, focused on the region, providing an interesting regional perspective for euro area policymakers regarding their policy decisions and actions. This research has formally provided researched-based evidence on the implications of their policy making on the large group of countries in the periphery of the euro area. These are just a few examples of interesting, useful and publishable research. This year we have a couple of projects that involve cooperation and joint works between Bank of Albania researchers and those from other central banks or academia. This is another way to increase the potential for publication and I would encourage you to increase the amount and scope of cooperation in research with foreign researchers. To conclude, I would like to reemphasize that we must enhance the overall efficiency of the transmission mechanism, and the resilience of the banking and financial systems so that potential and unexpected shocks do not advance to economic or systemic risk.
The foundation is the development in Hong Kong of multi-currency clearing and settlement systems operated on a real-time gross-settlement basis: so far we have systems for the US dollar, the euro, and the renminbi, in addition to the Hong Kong dollar; there is the possibility of replicating this for any number of currencies, should the demand arise. To make these systems available in Asian time to the rest of the region, we are progressively linking them to other cities in China and with other countries in the region: we established a link with Malaysia in 2006 and have agreed with Bank Indonesia to establish a similar link with Indonesia in 2010. I have no doubt that other links will follow. In addition, through our Regional CHATS service launched in July 2007, we have made available Hong Kong’s own clearing and settlement services throughout the region and beyond for cross-border payments. By June this year, 30 banks in Hong Kong had registered as service providers for services covering over 2,000 payment beneficiary points in 42 economies. BIS Review 93/2009  1  These are examples of how we are helping to build the hardware, or – to use the transport comparison – laying down the roads, tracks, junctions and interchanges, for regional financial markets. For the software and the actual traffic, it is of course the case that in a free-market economy such as Hong Kong's there is a limit to how much the government should take the lead.

In a recent report, the Malta Competition and Consumer Affairs Authority made a number of recommendations to address issues primarily related to price transparency, barriers to expansion and consumer mobility in view of improving competition and borrowing costs for SMEs. Bank charges on SME loans and charges for credit transfers need to be revised downwards to facilitate access to finance and also to encourage the use of electronic money, which would ultimately result in lower processing costs to banks. BIS central bankers’ speeches  7  Chart 9 – Credit growth to households and businesses  In keeping constant focus on maintaining competitiveness, the Government took a significant step by committing itself to set up the Malta Development Bank. Preparatory work on the establishment of the Bank is well advanced. The development bank will strengthen and diversify the local financial base and will contribute to economic growth by funding sectors and projects that are not catered for by commercial banks on their own. It will provide attractive wholesale financing and risk sharing facilities. It will be a powerful tool to bring to realisation more economically feasible projects. The delay in tackling non-performing loans (NPL) on the bank’s books is another factor that puts a drag on credit growth and reflects a dimension of credit risk that should be resolved. An efficient judiciary system that deals with insolvency cases in a timely and cost efficient manner facilitates credit risk management by bringing down the stock of NPLs.
David Clementi: Debt workouts for corporates, banks and countries: some common themes Speech by Mr David Clementi, Deputy Governor of the Bank of England, to the INSOL International Sixth World Congress held at the Hilton Metropole Hotel in London on 19 July 2001. *  *  *  Introduction I am delighted to have the opportunity to speak at this, the Sixth World Congress of INSOL International. The Bank has a long-standing interest in insolvency arrangements. As the keepers of the London Approach, we have a direct, if informal, role in corporate workouts. This is in part historical, but it is no accident. Development of a satisfactory framework for corporate workouts is integral to the Bank’s core purposes of maintaining financial stability and seeking to ensure the effectiveness of the UK financial system. The Bank is more commonly associated with the Monetary Policy Committee and the pursuit of monetary stability. But financial stability is an important corollary to this; it is difficult to achieve one without the other. The Bank in particular is closely involved with the design of regulation and financial infrastructure, such as payments and settlement systems, to ensure that these are robust and the system is, as a result, better able to withstand a crisis. Our interest in insolvency arrangements is similar. Without a framework that is predictable, equitable and transparent, designed to maximise value for all interested parties, the costs and wider economic disruption from unnecessary corporate liquidations may be enormous.

For risk management systems, this includes using stress scenarios to place appropriate limits on concentration and risk exposures. The use of value at risk (VAR) models that  BIS central bankers’ speeches  3  emphasize recent experience is clearly inadequate. In the case of compensation practices, firms and regulators need to continue to look for ways to tie compensation to the profitability of the firm over the cycle and rather than over shorter time frames, such as the calendar year, and making sure that compensation is appropriately adjusted for the risks that were taken. There also needs to be a framework for ensuring that collateral haircuts are high enough to provide meaningful protection in bad states of the world even if this means keeping collateral margins higher during the good times. Making progress on this front would help limit the propensity for leverage to increase when loss experience is low and to provide greater protection when volatility climbs and market conditions become less buoyant. In general, we need to continue to look to implement changes in systems and practices that will help dampen the pro-cyclicality of the system, and temper the amplitude of both booms and busts. Attention to the incentives created by infrastructure design is also important. Poor infrastructure design can serve to mask and obscure participants’ understanding of the credit and liquidity risks that they are exposed to. A good example of this is the triparty repo market, which plays a central role in providing funding on a collateralized basis.
Zambia has also benefitted from increased support from bi-lateral donors, with the prospect of additional resources being made available in the current calendar year from the European Union amounting to around 13% of all the grants that were scheduled to be received in 2009 from the EU and individual donors. Institutions such as the African Development Bank have also made changes to their procedures aimed at fast tracking the disbursement of critical development finance resources, against already approved projects. However, there are serious concerns that Africa has been disadvantaged in the allocation of resources made available by the international community – particularly to key institutions such as the AfDB. There is also concern that whilst the principle of increased resource flows through Institutions such as the IMF should be targeted beyond the traditional BoP needs has generally been accepted at a political level, there is some reluctance at the institutional level for institutions such as the IMF to venture outside of their traditional confines of their support. In Zambia, the Government has engaged our cooperating partners to ensure that the additional resource provided to help African countries deal with the global crisis can be utilized to do just that – and not be simply kept for a rainy day that ignores the current  4  BIS Review 128/2009  monsoon. In my own personal interaction with the IMF, I believe that in Zambia we do have a good common understanding on this issue.

Earlier in my remarks I did make reference to the fact that one of the greatest dangers facing African economies is the risks that the current crisis might trigger significant policy reversals that undermine important institutions such as the Government as well as the central bank. It is important that in Africa, the critical work of consolidating fiscal positions and improving the Governance arrangements and financial management of public resources is sustained. In many ways, fiscal sector reform reflected in the curtailment of fiscal dominance, have been the central platform upon which macroeconomic stability has been built and achieved in Zambia. From the central bank perspective, the Bank of Zambia has worked to improve its own credibility by working with commercial banks and other financial institutions to improve Governance arrangements in the financial sector, improve the frequency and level of communication between the bank and the institutions that it supervises, as well as the general public. Much of this work has been done under the framework of a comprehensive Financial Sector Development Plan (FSDP) that has had broad support from our cooperating partners. At the regional level, a new SADC Model Central Bank Act has also been approved by the Ministers of Finance in SADC that enshrines important principles of independence and good corporate governance as a yardstick to be followed by all central banks in the region.
BIS Review 24/2007  Underlying assets The underlying assets largely consist of corporate bonds; these account for around 80 per cent. However, there are other types of credit, such as traditional bank loans and various forms of sovereign debt. The corporate bonds market currently covers more than USD 6,000 billion in global terms. This means that the outstanding volume in credit derivatives is more than twice as large as the total amount of outstanding corporate bonds. The reason for this is that credit risks are resold on the market through new derivative contracts. This is not actually any stranger than insurance companies selling part of their risks by reinsuring themselves, but it may be good to bear this in mind when looking at the statistics. Today, credit risk is priced on thousands of corporate credits through credit derivatives, although most of the trade is still in a few hundred very large companies. Companies in all types of industries and with different credit ratings are traded. Communication, such as the example of TeliaSonera, is one of the most traded sectors, together with the automobile industry and finance. The credit quality of the underlying bonds is generally very high. But appetite is increasing for underlying assets with low credit ratings. The standardised maturities have also increased in number with time and there is a tendency for longer maturities, five to ten years, to be traded more.

This broad membership makes the TMA the authoritative industry association and focal point for treasury matters in Hong Kong. I am also glad that there are four committees established to focus on the four key areas that I have spoken about. We at the HKMA consider the TMA an important new element of our financial infrastructure. We are confident that the TMA will play a pivotal role in the maintenance of the status of Hong Kong as an international financial centre. May I congratulate you all on today's inauguration a nd wish you all the very best for the future. 2  BIS Review 4/2006
Owing to the characteristics specific to the Norwegian credit market, policy rate cuts quickly result in lower borrowing costs for households and enterprises. One characteristic is that most households prefer floating-rate loans. We need look no further than to Sweden to find a considerably lower share of floating-rate loans than in Norway. In the UK and Germany, only a small minority show the same preference as Norwegian households. Chart: Share of floating-rate loans – new mortgages Another characteristic of the Norwegian credit market is that a large share of corporate financing is obtained via banks and often at floating rates. Changes in the policy rate will pass through to banks’ funding costs through short-term money market rates. The high share of Norwegian loans issued at floating rates has its counterpart in banks’ preference for floating-rate funding. Fixed-rate payments on bank bonds are typically swapped for floating-rate payments in the derivatives market. In addition, most retail deposits pay interest at a floating rate. Under normal conditions, changes in funding conditions will in the next round be passed on to banks’ retail borrowers. Thus, the structure of the Norwegian credit market makes changing the policy rate an effective tool. But how far can the policy rate be lowered before monetary policy loses its effect? In Norway, the policy rate has never been lower than half a percent. In other countries, policy rates have been as low as minus 0.75 percent. Negative policy rates in other countries have on the whole passed through to money market rates.

Journal of Economic Perspectives, 32 (4) Eggertsson, G. B., R. E. Juelsrud, L. H. Summers and E. Getz Wold (2019) “Negative nominal interest rates and the bank lending channel”. Norges Bank Working Paper 2019/4 Filardo, A. and J. Nakajima (2018) “Effectiveness of unconventional monetary policies in a low interest rate environment”. BIS Working Papers 691 Haldane, A. G., M Roberts-Sklar, T. Wieladek and C. Young (2016) “ QE: the story so far”. BoE Staff Working Paper 624 Hesse, H., B. Hofmann and J. Weber (2017) “The Macroeconomic Effects of Asset Purchases Revisited”. BIS Working Papers 680 Kuttner, K. (2018) “Outside the Box: Unconventional Monetary Policy in the Great Recession and Beyond”. Journal of Economic Perspectives, 32 (4)  1 Assuming that inflation holds steady and expectations remain consistent with the target. 2 How low three-month Nibor will be with a policy rate of zero depends on the size of the spread between Nibor  and the expected policy rate, the risk premium. This premium has varied over time. In Monetary Policy Report 3/19, it was projected at 0.4 percentage point for the coming years. 3 8/9  BIS central bankers' speeches  3 The illustration is based on figures used in NEMO, Norges Bank’s macroeconomic model. 4 See for example the analysis based on Swedish data in Eggertsson et al. (2019). 5 There is now an extensive body of both theoretical and empirical literature, discussing alternative instruments. For example, Borio and Zabai (2016), Dell’Ariccia et al.