samchain/econo-pairs-v1 huggingface dataset:
The first school, usually identified with Professor Paul Krugman of MIT, is best summarized by the two fashionable phrases “crony capitalism” and “Asian values.” The emphasis here is on inept domestic policies, inefficient resource allocation to politically connected individuals, unrealistic speculation - particularly in real estate - and imprudent public spending, all fuelled by over-borrowing, poor bank supervision, extreme moral hazard, and a hubristic attitude generated by several years of fast growth. The trends were unsustainable, and the Nemesis came with a loud and very messy bursting of bubbles throughout the region. Asia’s downfall, says Professor Krugman, “was a punishment for Asian sins, even if the punishment was disproportionate to the crimes.” The second school, led by Professor Jeffrey Sachs of Harvard, sees the crisis in less moralistic terms. The turmoil, he says, was a classic financial panic: a run on the banks and mass capital flight exacerbated by the maturity mismatch of many Asian banks and the currency mismatch of many Asian borrowers. This was accompanied by speculative attacks on currencies and the collapse of asset values. While this approach stresses the fragility of many of the banking systems in the region, it maintains that the Asian economies were in relatively healthy shape according to the usual indicators, and that the magnitude of the crisis far exceeded the faults and errors of individual jurisdictions. Both the Sachs and the Krugman schools have much in common. But their logic points in different directions.

Jean-Claude Trichet: A rich variety of cultures at the heart of Europe Interview with Mr Jean-Claude Trichet, President of the European Central Bank, in the Frankfurter Allgemeine Zeitung special supplement of the ECB Cultural Days, published on 4 October 2009. *  *  *  1. The ECB Cultural Days have been held seven times since their launch. On three occasions, they have featured countries from eastern Europe. What does eastern Europe bring to Europe and to Frankfurt, in particular? It is very important for the ECB – with our staff coming from all 27 EU Member States – to discover or rediscover the wealth of European culture in the international environment of Frankfurt and its surrounding area. As you say, it has always been our aim to embrace the whole of Europe, both the old and new members of the European Union. It is no accident that we have welcomed three central and eastern European and three western European countries. Last year, on the occasion of the tenth anniversary of the ECB, the events involved all 27 EU Member States in order to underline the diversity of European culture. This year, the 20th anniversary of the fall of the Iron Curtain, the event takes place against the unique backdrop of the reunification of Europe. 2. You made a speech on European culture in Frankfurt this spring, which explored the link between the concepts of roots, diversity and identity. Did you have the ECB Cultural Days in mind? Of course.
Ravi Menon: The work of the NGFS in four emerging issues in climate change Opening remarks by Mr Ravi Menon, Managing Director of the Monetary Authority of Singapore and Chairman, Network for Greening the Financial System (NGFS), at the NGFS Workshop, Singapore, 26 April 2023. *** Good morning, ladies and gentlemen. I am delighted to welcome you to the inaugural NGFS Workshop in Singapore. We held our annual NGFS Plenary meeting yesterday. We discussed how the NGFS can continue to push the envelope in greening the financial system: to strengthen the resilience of the financial system to climate and environmental risks and; to encourage financing flows to support the transition to a net-zero world. The NGFS is well-placed to do this – we are a coalition of 125 central banks and financial regulators from over 90 jurisdictions. Our size enables us to make an impact globally and our diversity enables us to harness multiple perspectives. The work we do is not only important but urgent. Climate change is already happening – its physical manifestations are becoming increasingly evident – especially here in Asia. We are already seeing unprecedented heat waves, floods, and agricultural degradation. One of the key roles of the NGFS is to build capacity and capabilities among central banks and supervisors to deal with the climate challenge. This inaugural NGFS Workshop, with more than 150 participants from over 60 institutions, will discuss cuttingedge economic and financial issues related to climate change and nature loss.

increased sectoral granularity and geographical coverage, especially in emerging economies; inclusion of short-term scenarios, incorporating more adverse tail-risk events such as a sudden policy shock; and improved representation of acute physical risk. Blended finance To get to net-zero by 2050, we have to close a large financing gap. According to McKinsey, net zero by 2050 will require about $ trillion of investment per year, but only about $ trillion per year is being invested today. We are more than 35% short of the annual investment required for net-zero. Blended finance will be crucial to unlocking more capital for green and transition projects, particularly in emerging economies. Blended financing structures can alter the risk-return profile of many marginally bankable projects. This can be done through catalytic and concessional funding from the public sector, multilateral development banks, and philanthropic sources to crowd in multiples of private capital. By mitigating a portion of project risks, providing technical assistance, and lending their reputation and expertise, the public sector can help to attract private capital which may otherwise be hesitant to invest. We need to mobilise the financial system to deploy blended finance at scale. The NGFS will contribute to this effort in three ways. We will use our convening power to raise awareness of blended finance and help to bring the relevant parties into the room. We will seek to identify potential regulatory, market or policy barriers that hamper the scaling up of blended finance.
Owing to the fall in oil prices, government petroleum revenues are now lower. Volatility in the return on the fund’s investments could have a considerable impact on the fiscal room for manoeuvre in the coming years. Norges Bank has managed the GPFG since the first transfer was made in May 1996. An important part of our responsibility for the operational management of the fund is to advise the Ministry of Finance on the fund’s investment strategy. Chart: Equity share in the strategic benchmark index and of the fund The investment strategy issue of most importance for the fund’s return and financial risk is the fund’s equity share. Under the current investment mandate, the size of the fund’s actual equity investments will largely be determined by the equity allocation set by the Ministry of Finance for the fund’s benchmark portfolio. The equity share in the strategic benchmark index provides an important indication of volatility tolerance with regard to the fund’s value. To be able to maintain the investment strategy, not least in periods of falling equity prices, a good understanding and broad-based acceptance of the fund’s risk are essential. The equity share in the fund’s strategic benchmark index is therefore naturally reassessed at regular intervals. The Ministry of Finance has increased the equity share in the strategic benchmark index twice on the advice of Norges Bank and others.

If government indebtedness reaches a sufficiently high level that it triggers a loss of confidence in fiscal sustainability, investors will require additional risk premia to compensate for having to bear greater sovereign credit risk. The resulting rise in sovereign risk premia can be passed through to private sector funding costs, especially if there is doubt about the ability of the public sector to counter adverse disturbances to non-financial and financial sectors. Chart 2 on slide 6 shows how CDS spreads for large banks have become increasingly correlated over the past seven and half months with the sovereign CDS spreads of the countries where these banks have their headquarters. Two snap-shots are shown in the chart: one for 26 November 2009 and the other for 19 May 2010. As can be seen from the chart, between these two dates, as sovereign CDS spreads have risen, so have bank CDS spreads. It is furthermore interesting to note that, in the cases where concerns about fiscal imbalances have been greater, the co-movement has been substantial. The third risk we have identified outside the euro area financial system is the possibility of vulnerabilities being revealed in non-financial corporations’ balance sheets, because of high leverage, low profitability and tight financing conditions. The balance sheet conditions for the euro area non-financial corporate sector have slightly improved since the last issue of the FSR, which has translated into a moderate lowering of the expected write-downs facing euro area banks on their corporate loan portfolios by end–2010.
I think we have helped to contribute to the considerable progress made on a number of fronts, including making the financial system more resilient and robust and helping make monetary policy more effective, even at the zero lower bound. But there is much more work to do. In particular, I think we have just scratched the surface in understanding how developments in one area, such as capital and liquidity requirements for large, complex financial institutions, affect other areas, such as effective monetary policy implementation. We still don’t have well developed macro-models that incorporate a realistic financial sector. We don’t understand fully how large-scale asset purchase programs work to ease financial market conditions – is it the effect of the purchases on the portfolios of private investors, or alternatively is the major channel one of signaling? There are many other riddles that remain to be solved. How does one design an effective reference rate that is informative, verifiable and not vulnerable to manipulation? If you manage to come up with one, how do you migrate the trillions of dollars of existing contracts to the new standard? The U.S. unemployment rate has declined more sharply than one might expect given the economy’s growth rate over the past few years. Is this permanent or will it reverse if the economy continues to grow and the pressure on labor market resources increases in the coming years? How does one end “too big to fail” for large global firms operating across different jurisdictions? The list goes on and on.

In fact, many of those with economics Ph.D.s elsewhere in the Bank started their careers at the Bank in the Research Group. They moved to other areas of the Bank as their interests evolved and they became less focused on research and more focused on policy development. This movement of economists throughout the organization has helped build a deep reservoir of human capital within the Bank and has fostered close collaboration between Research and other areas of the Bank. Our model with respect to attracting economists into our Research Group is to hire people with strong research skills, with the highest academic credentials and who already have or are likely to develop a policy orientation related to the Bank’s work. We give our economists plenty of time and opportunity to conduct independent research, and expect them to publish their research in the major academic journals and to engage with the economics profession outside the Bank. As they progress in research capability, we require economists to apply the skills and techniques they use in research to policy issues. We expect that, as their academic careers develop, there will be a natural convergence between their research interests and the Bank’s policy agenda. This usually happens as a matter of course because the Bank has a rich agenda of policy issues to work on and the economists at the Bank often have unique access to data and information that would not be available elsewhere.
Unlike the 1980s, the build up of debt in recent years has been in an environment of low inflation and low interest rates. The interest ratio, that is, interest expenditure as a share of disposable incomes, is much lower now than it was then. Although the level of households' debt ratios is not necessarily worrying, it is nevertheless the case that a borrowing level rising by more than 10 per cent a year is not sustainable in the long term. In the long term it needs to come down and be more in line with nominal disposable incomes. The Riksbank is assuming that household borrowing will continue to increase, but at a slower rate than before. The fact that interest rates have been raised contributes to this, as does the fact that economic activity is entering a calmer phase. The interest ratio has recently begun to rise but is still at an historically low level. The expected  BIS Review 60/2008  1  slowdown in household borrowing will mean that the interest ratio also increases at a slower rate in future (see figure 3). The chances are good that household borrowing and house prices will have a soft landing. Although borrowing is still increasing at a rapid rate, there has nevertheless been some slackening and this is expected to continue. House prices fell slightly in the first quarter of this year compared with the final quarter of last year. However, on an annual basis the increase was just over seven per cent.

Ted spread Basis points, 3 month duration 250  250 225 200 175  200 175  150  150  125  125  100  100  75  75  50  50  25  25  0 jan-07  BIS Review 60/2008  225  USA Euroland Storbrit annien Sverige  0 mar-07  maj-07  jul-07  sep-07  nov-07  jan-08  mar-08  maj-08  7  Figure 8. Credit spreads, USA  Figure 9. Premiums in CDS for a sample of banks Basis points, duration 5 years 1100  1100  1000  1000  900 800 700  800 700  600  600  500  500  400  400  300  300  200  200  100  100  0 jan-07  8  900  Kaupthing UBS Cit ibank Bear Stearns Lehman Brothers Deutsche Bank  0 mar-07  maj-07  jul-07  sep-07  nov-07  jan-08  mar-08  maj-08  BIS Review 60/2008
On this note, Ladies and Gentlemen, I have great pleasure in declaring open the Payment Systems Forum and Exhibition 2005. Thank you. BIS Review 84/2005  3

That is why in the minutes of its March meeting, the MPC  BIS Review 46/2009  5  indicated that, just as with its decisions on Bank Rate, we would review the appropriate scale of the asset purchase programme each and every month. 3. Conclusion  The extraordinary developments in the global economy since the autumn have been matched by the magnitude of the policy response. Monetary policy continues to play its part, with Bank Rate set at a historically low level and the launch of a large-scale asset purchase programme. Throughout these dramatic developments, the objective guiding the Committee’s decisions has remained the same: the need to keep inflation on track to meet the Government’s 2% inflation target. It was that objective that underpinned the decisions to reduce Bank Rate to unprecedented levels. And it was that objective that drove the MPC to adopt unconventional policy measures. The inflation target will also dictate the rate at which the stance of monetary policy is returned to normal as economic prospects recover. The outlook for inflation relative to the inflation target provides the natural guide to exiting from this period of exceptional monetary stimulus. Importantly, this exit strategy is clear, transparent and open to public scrutiny. Openness and transparency have been the cornerstones of UK monetary policy since the Monetary Policy Committee was established in 1997. That has never been more important than now. The inflation target is symmetric. That requires the MPC to set policy in a symmetric way.
Supervisors from different nations are working together in an effort to create more effective cross-border crisis management tools and resolution regimes, but this work is still in its very early stages and there are formidable obstacles to overcome. A second challenge is the uneven progress that has been made in reforming bank regulation and supervision across the different jurisdictions. For example, in some cases, the supervisory authorities have been quite forceful in making banks domiciled in their countries raise capital. In other cases, the response has been less aggressive. The uneven progress of reform makes comprehensive reform more difficult. It shifts the tenor of the discussion away from what is the proper macroprudential framework and set of capital and liquidity requirements to one that focuses too much on issues of relative competitiveness. Too often the questions asked are: What is most beneficial to the banks of my particular country? Do the regulations bolster or harm my “national champion”? The focus shifts away from the goal of bolstering global financial stability to finding ways of tilting or adjusting the new standards to achieve a national competitive advantage. This is in not in anyone’s interest. As discussed earlier, every nation has an interest in promoting financial stability globally, since the effects of systemic financial stress in one place can swiftly spread throughout the global economy. Moreover, although a relatively loose regulatory regime may attract business from other financial centers, there is no free lunch here.

First, the capital requirements have been raised so that internationally active banks must have common equity ratios of at least 7 percent of risk-weighted assets when the standards are fully phased in by 2019. This 7 percent standard consists of a 4.5 percent minimum plus a 2.5 percent capital conservation buffer. Banks whose capital ratios fall into the buffer range will face increasingly stringent restrictions on capital distributions such as dividends and share repurchases and discretionary bonus payments to staff. This should act as a form of “automatic stabilizer” to their capital resources and change the incentives banks face during periods of stress. Second, for many globally active banks, the amount of capital required will also rise because the amount of risk-weighted assets against which the capital ratios are calculated will increase. Explicit capital requirements for operational risk and counterparty credit risk, as well as increased requirements for certain trading activity and transactions between financial institutions should result in a significant rise in risk-weighted assets. On the quality side, capital requirements have been toughened by narrowing the definition of what can be counted toward common equity capital for regulatory capital purposes. The emphasis has been put on common equity because of the superior loss-absorbing capacity of this type of capital on a going concern basis.
One reason for this shift is the segmentation between banks, which have access to the ECB’s deposit facility, and non-banks as well as entities outside of the euro area, which do not have access. The conference paper by Eisenschmidt, Ma and Zhang (2020)[10] studies how this market segmentation can affect monetary policy transmission. Monetary policy transmission through money markets I will now turn to the determinants of monetary policy transmission through money markets. One metric that can be used as an indicator of monetary policy pass-through is the volume-weighted cross-sectional dispersion of money market overnight rates (Slide 3). This metric, proposed by Duffie and Krishnamurthy (2016), is a useful way to combine information on money market rates and volumes. [11] Intuitively, the dispersion index is low in relatively frictionless markets. Increases in dispersion indicate that money market rates do not move in tandem, which can signal impairments in the pass-through of the https://www.ecb.europa.eu/press/key/date/2020/html/ecb.sp201123~8d9573b1b1.en.html  2/7  24/11/2020  Shifting tides in euro area money markets: from the global financial crisis to the COVID-19 pandemic  monetary policy stance to private market rates. Based on the dispersion index, I will highlight the changing role of factors affecting monetary policy transmission in the euro area through money markets since the global financial crisis. I will focus on three key factors that have an impact on the transmission of monetary policy decisions through money markets: financial stress, central bank liquidity provision and regulatory changes.

24/11/2020  Shifting tides in euro area money markets: from the global financial crisis to the COVID-19 pandemic  SPEECH  Shifting tides in euro area money markets: from the global financial crisis to the COVID-19 pandemic         Speech by Isabel Schnabel, Member of the Executive Board of the ECB, at the ECB Conference on Money Markets, 23 November 2020 Frankfurt am Main, 23 November 2020 I would like to welcome you warmly to our virtual ECB Conference on Money Markets. [1] This conference offers an excellent platform to facilitate the exchange between academic experts on money markets and policy makers. The conference papers address some of the most topical research questions with respect to money markets and will thus provide valuable input for the implementation of our monetary policy. Money markets are a cornerstone of the financial system. [2] Banks, non-bank financial institutions[3] and non-financial corporations all rely on money markets for their short-term funding, liquidity management and collateral needs. As a result, dislocations in money markets can severely undermine the stability of our financial system. Due to their central role as a source of short-term funding, money markets are also crucial for the implementation and transmission of our monetary policy. Money market rates serve as operational targets for central banks and also as benchmarks for the pricing of credit, thereby directly affecting financing conditions in the real economy.