samchain/econo-pairs-v1 huggingface dataset:
Interestingly, I find evidence in the early (pre-1988) sample that suggests that inflation was, if anything, more sensitive to the unemployment gap when unemployment was high, rather than low. Although these estimates are imprecise, this pattern is the opposite of the claim by HMS, which relies on full-sample estimates to draw conclusions. This also runs counter to HMS’s historical narrative about the 1960s and the dangers of a red-hot labor market. I will not dwell on this further, but it is a reminder that findings of nonlinearities in Phillips curves are often not robust. The apparent breakdown in this simple price Phillips curve in the past 30 years reflects a number of structural changes in the U.S. economy. The Federal Reserve’s success in re-anchoring inflation expectations at a low level can explain the decline in inflation persistence seen in the data.1 However, the role of well-anchored expectations in flattening the Phillips curve is not obvious, and as HMS note, this flattening is not as clear in the wage inflation equations. This suggests other forces are at work. Several usual suspects come to mind, including the effects of supply shocks, increased globalization of goods markets and supply chains, and changes in the market structure for consumer goods.

House prices, after several years of increasingly more moderate rises, began to post small declines in some market indicators as from the second quarter of this year, while housing starts fell by almost half. This abrupt change in scenario, together with the tightening of financing conditions, which I shall address in greater detail later, meant that real estate companies had to restructure, with some of them even going bankrupt. This series of factors compounded the correction of the residential sector with adverse consequences for employment, which is acting as the main channel through which the adjustment of the sector is spreading to the rest of the economy. Household consumption is rapidly reflecting the deterioration in confidence, against a backdrop of considerable financial tensions, and the abrupt turnaround in the employment situation. As a result, a certain rise in the saving rate consistent with the current scenario of greater uncertainty and financing difficulties might be taking place. I should stress that this far-reaching slowdown in private consumption is the factor that is most contributing to the loss of dynamism in the economy. Business investment also slowed rapidly, in line with the changing financial conditions, the profile of domestic demand and the deterioration in business confidence. Nonetheless, exports are sustaining a relatively high growth rate, despite worsening world trade so far this year, and they are providing some support to investment in equipment.
Pension plans that had placed funds in AIG guaranteed investment contracts, or GICs, which function much like deposits in a bank, would have experienced significant losses, losses that would be passed along to retirees or to others whose aspirations to be retirees would surely have been changed. BIS Review 73/2010  1  And these indirect consequences of an AIG bankruptcy would not have stopped at the U.S. border. AIG was global in scope. It conducted its operations in more than 130 countries, and across various parts of the financial industry, insurance as well as banking. The damage from an AIG filing would have been felt from the farms of Iowa to the streets of San Francisco to the far off corners of the world. The unplanned and chaotic bankruptcy of this trillion dollar financial conglomerate (especially a day after Lehman’s filing) would have been a global catastrophe. That catastrophe did not happen. More than a year and a half later, it is easy to forget the level of panic and fear that gripped the world during the week of September 16, 2008. A bankruptcy of AIG would have fueled the fear, much as gasoline fuels a fire. And let us not forget what Federal Reserve and Treasury officials have said many times in testimony – we did not have the necessary tools, such as legal authority for a special resolution regime, with which to limit the damage of an AIG collapse. We also did not have the luxury of time.

And, neither bankers nor traders have a monopoly on this capacity -- corporate treasurers and institutional investors can pull up most of the same screens we can. At one time, a presence in a local market and access to early newspapers could provide a trading advantage for a large market maker. Today, news from that market is available electronically worldwide with almost no lag. Information is cheaper and easier to come by than ever before. The result? A global market that reacts quickly and efficiently to new data, and participants who have more time to analyze information because they need to spend less time gathering it. One consequence of this improved transparency in information technology is that information gets reflected in asset prices more quickly and more smoothly than ever before. A closely related development that has also contributed to increased transparency in the foreign exchange market has been the rapid evolution of the price discovery process in the past several years. Electronic brokerage and electronic interbank dealing systems have evolved that have smoothed the dissemination of current pricing and improved market liquidity. Whereas truly competitive pricing was once the province of only the largest market makers, smaller interbank dealers -- and even some foreign exchange end-users -- now also have access to narrow bid-ask spreads. The result so far has been a deeper market and, again, a more level playing field for all market participants, with pricing no longer dominated by a few large players.
Or does it represent more of an opportunity? Europe must show that it is a prosperous and secure area. In the short term migration will have an economic impact in the form of a fiscal expansion with some positive impact on growth. Germany’s fiscal situation is likely to deteriorate by around 0.3% to 0.4% of GDP in 2016 and 2017. This deterioration will be weaker in other countries. In the long term we will also have to look at the impact of the refugee crisis. This population is different, and care will have to be taken in integrating the migrants into the labour market, especially in Germany. In the medium term, from a demographic point of view, it can be a positive factor. The key issue is that of integrating migrants into the labour market in line with their profiles. All of these economic aspects are known and straightforward. From an economic perspective, this situation is not insurmountable; it is above all a political issue. The more integration we achieve at the economic level, the more it will be accepted politically. But all of this cannot be done in a day. Europe needs a young and well-trained workforce. We can create an opportunity out of a tragic situation, but it is not going to be easy. It is possible for a country to organise migration, and we have already done so in the past. The issue of security to combat the threat of terrorism will become a major challenge for governments in the months to come.

2/3  BIS central bankers' speeches  To conclude, Islamic financial institutions have developed into matured institutions that are now offering a wide range of financial solutions to meet the varied needs of customers. Therefore, halal businesses should seize these opportunities to better position themselves and embrace sustainability, as well as digitalisation that aim to provide stronger platforms to rebound as the economy recovers. In closing, I would like to share with you an inspiring verse from the Quran, that serves as the foundation to the key points I have intended to raise earlier. In Surah Al-Baqarah verse 195, Allah s.w.t mentioned, “And do good, indeed Allah loves the doers of good”. So, let us embrace this message together and put more effort in propagating good, particularly in the way we conduct businesses, by not just being halal, but also beneficial to the environment and society at large in line with the commandment of Allah s.w.t. Let us begin this today, here at the World Halal Business Conference 2021. Thank you and I wish everyone a pleasant and productive conference. 1 Source: Dinar Standard, The State of Global Islamic Economy 2020/2021 2 Halal food, Islamic finance, Muslim-friendly travel, pharma and cosmetics 3 Source: HDC HIMP 2030 4 BNM internal survey 5 Source: HDC Vibes issue 06/2021  3/3  BIS central bankers' speeches
The purpose was twofold: first, to level the playing field for domestic credit institutions with respect to their access to facilities at the Central Bank, and, second, to adjust the operating environment of domestic credit institutions to the environment prevailing in the European Economic Area. These changes have been modelled on the instruments designed for the prospective European Central Bank, which will be established on July 1 and formally commence operations on January 1, 1999. Under the auspices of the European Monetary Institute, the precursor to the European Central Bank, work has proceeded on designing the monetary instruments of the bank. The Central Bank has followed this work to the extent possible. Some issues, such as concerning reserve requirements, will not be resolved until after the European Central Bank has been established. The Central Bank may therefore adjust its rules when the situation in Europe becomes clearer. The first step in changing the Central Bank’s instruments was taken on March 1 and covered the following. The liquidity requirement of deposit banks was abolished. Weekly auctions of 14-day repurchase agreements replaced the tap-sale of these agreements. All government guaranteed securities and the Central Bank’s certificates of deposit qualify as collateral for repurchase agreements rather than only Treasury bills and certificates of deposit. The Central Bank will auction 14-day certificates of deposit when it feels the need to withdraw liquidity. The direct sale of 45-day certificates of deposit will cease, but 90-day certificates will continue to be sold.

•  That doesn’t tackle biggest issue of all. Central banks can, to a degree, smooth the necessary adjustment of economies and so create time for households, firms, governments to strengthen their balance sheets where necessary and adjust to shifts in the relative pattern of demand for goods and services. That is what is going on in the West now. But obviously central banks cannot force others to act. And our actions can make delay seductive. •  Given central banks’ responsibility to explain, we can nudge but we must stay within our remit. •  In the present crisis, part of the real-side adjustment is needed within the banking system. For that the Bank of England does have a special role. Through the new Financial Policy Committee (FPC), we have been pressing the banking industry to adjust given the external threats, as sound banks are needed for sustainable recovery. •  This represents the first intervention of so-called macro-prudential policy. Can view the role of the FPC as being to ensure that the need for stability in the financial system is not overlooked. Looking ahead, this will mean keeping the regulatory regime up-to-date as the financial system evolves and, when the time comes, ‘taking away the punchbowl’ before the next party gets as dangerously out of control as the last one did. •  The case for operational independence here is just as strong as for monetary policy. Taking Away The Punchbowl is something that requires a medium-term orientation.
At the same time, it is of course desirable that the measures targeted at household indebtedness and the housing market do not in themselves lead to an economic downturn or unnecessarily obstruct monetary policy. The primary aims of policy in this area must be to ensure that the build-up of household debt slows down, that the households gradually become more resilient to shocks of various kinds and that the housing and mortgage markets become more effective. This is thus a question of a long-term adjustment process that must take place in suitablylarge steps. The amortisation proposal – a step in the right direction I see last week’s amortisation proposal as one such suitably-large step in the right direction. As only new mortgages will be covered, increased amortisation will be phased in over a long period of time. In combination with many new mortgage borrowers already amortising, and because the proposal entails only a moderate increase in amortisation rates, this means that the macroeconomic consequences will probably be small during the first few years. According to the Riksbank’s estimate, the amortisation proposal will have reduced the household debt ratio by 0.6 percentage points after five years compared with a base scenario. This means that the proposal will increase amortisation payments by less than 0.1 per cent of GDP per year during the period.5 The amortisation proposal thus appears to be well balanced at the moment, but work on the long-term adjustment process must continue. There are many factors to take into account when considering further measures.

In the future, we may well end up in the opposite situation with the repo rate being set higher than justified by this particular part of the economy. Longer fixed-rate periods desirable It is difficult to determine how large a proportion of variable interest rates is desirable in an economy, but I suspect that we have gone too far in that direction in Sweden. And by this I mean from the point of view of systemic risk. For an individual household there may be good reasons for choosing a variable interest rate, but for the economy as a whole it would probably be good if we could limit the proportion of variable rates. This can be achieved in different ways. In some countries, regulations have been used to either limit how large a proportion of the mortgage may have a variable interest rate or how much a variable interest rate may increase during the maturity of a mortgage. In other countries, long fixed-rate periods have become the norm without the need for regulations. The fact that this has not happened in Sweden indicates that the financial markets are not working well enough for some reason. This may, for example, be due to the lack of a market for mortgage bonds at really long maturities, or of regulations concerning how mortgages with long fixed-rate periods can be paid off prematurely.
Turning to the distributional consequences of the asset purchases, attention has focussed on the downward impact on annuity rates, which have fallen about a percentage point over the past three years since we started our purchases. That means someone 2 with a £ pension pot, who could have expected that to yield an annual pension of a little under £ three years ago, would now get just under £ That is a rather substantial income loss. But it is only part of the story. Those pension funds will typically have been invested in a mix of bonds and equities, with perhaps a bit of cash too. The rise in asset prices as a result of quantitative easing consequently also raises the value of the pension pot, providing an offset to the fall in annuity rates 3. The impact of quantitative easing on those approaching retirement is thus more complex than it seems at first blush. More generally, the current extended period of rock-bottom interest rates has impacted heavily on those holding most of their savings in deposit or short-term savings accounts, who have seen negative real returns. Savers have every right to feel aggrieved at losing out; after all, they did nothing to cause the financial crisis. But neither did most of those in work, who have also seen a substantial squeeze in their real incomes. And unemployment, particularly among the young, has risen as output has fallen. This is all a reflection of the hit to output from the financial crisis.

So it is with the economic medicine of low interest rates and quantitative easing. The immediate consequences may be unpalatable, but the sooner we can get the economy on the mend,  2  For a single male, aged 65. 3  Indeed, if the savings were held in bonds of a maturity structure that matched the likely longevity of the individual, the two effects would cancel each other out. 4  BIS central bankers’ speeches  the sooner we can return policy to more normal settings and the better it will be for all of us – savers, businesses and employees alike. Thank you! BIS central bankers’ speeches  5
John Gieve: The City’s growth – the crest of a wave or swimming with the stream? Speech by Sir John Gieve, Deputy Governor of the Bank of England, to the London Society of Chartered Accountants, Bank of England, London, 26 March 2007. *  *  *  Introduction Over the past few months there has been renewed talk of London overtaking New York as the world’s leading financial centre. And it has reflected fears in the US as much as self congratulation in this country. We should take some of this with a pinch of salt. Talk of an external threat may be helpful to those building a case for change in the US financial system. The US market remains the biggest in the world by many measures. More fundamentally this is not a zero sum game. Even if London establishes a comparative advantage and gains market share, New York (and Paris and Edinburgh for that matter) can prosper too. Yet something interesting is going on. The report by McKinseys commissioned by Mayor Bloomberg concluded that “London is transforming itself into an increasingly sizeable and attractive talent hub for people with … skills that used to be available only in New York …” and “… superior conditions for innovation, capital formation, risk management and investment in these markets [derivatives and debt financing] are beginning to emerge (or have already done so) in London, which is building momentum relative to New York”.

2 We know that financial intermediation as a whole accounted for about 8.5% of UK Gross Value Added in 2005. And a recent estimate 3 of the professional services supporting financial services accounted for a further 3.6% of economic activity in 2005, giving a total of some 12%. That compares with around 14% of GDP for the UK manufacturing sector and the jobs in financial and business services taken together have increasingly outnumbered those in manufacturing. 1  “Sustaining New York’s and the US’ Global Financial Services Leadership”. Report by McKinsey & Company to Mayor Michael Bloomberg of New York and Senator Charles Schumer (pages 14 and 54). 2  Indeed the ONS has announced that it will be revising its estimates of the level and composition of GDP to incorporate changes to the measurement and treatment of value added for banks and to take better account of in-house software development. 3  International Financial Services, London. “International Financial Services in the UK”, November 2006. BIS Review 29/2007  1  And since 1999 financial services and insurance taken together have accounted for over 20% of the UK’s exports of services. So it is clear that the financial sector is an important industry for the UK. But financial intermediation covers a great deal more than the City. Retail banking and insurance, like other retail services from restaurants to hairdressing, is widely dispersed across the country. In general one would expect this part of the industry to reflect the size of the population and their wealth.
This real quantity has to be exchanged among members of the society. Since it is practically impossible to trade one commodity for another commodity in a modern complex economy, there arises the need for adopting a common medium of exchange. “Money” offers the service of this common medium of exchange at the cheapest cost to conclude the transactions running into billions. BIS Review 48/2007  1  Money, unlike the real commodities, is a peculiar animal. Its usefulness arises from its ability to acquire real goods and services which people can enjoy. If money does not have this ability, no one would be interested in having money. Hence, the value given to money is simply an imaginary value . As a result, money bears a nominal feature, as against the real feature borne by other goods and services. That is why any value measured in terms of money is also known as a nominal value. We may illustrate the role played by money in an economy by considering the operation of a simple economy where there are only two commodities, say, coconuts and money. Everybody has to use money to get coconuts or use coconuts to get money so as to store their wealth (for getting coconuts in the future). Suppose there were 10 coconuts and 100 units of money. Then, each coconut has to be exchanged for 10 units of money per coconut.

The entry of new players in the market is testimony of the confident that Bank’s supervisory oversight of the sector has instilled in both the general and investing public. We remain committed to executing our mandate and in ensuring that the financial system is properly regulated in order for economic agents to undertake their activities in a safe and sound environment. Distinguished guests, we note that financial intermediation is still very low in our economy and as such a lot of work still remains in this area. The Bank of Zambia encourages and supports market initiatives aimed at the financially excluded in order to achieve the objective on financial inclusion. It is therefore my view that promoting the initiative of reviving the operations of a Co-operative bank is important. As you are all aware, in a co-operative bank, shareholders and customers are the same group of people whose dominant purpose is to provide customer value by offering tailored-made products and services cost-effectively and close to home. Through their membership structures, Co-operatives are known to have a firm foothold in local communities and a sound knowledge of people’s overall financial situation. This enables accurate decision making and risk control which in turn, fosters regional development and social cohesion. Co-operative banks are also known for pioneering sustainable development and corporate social responsibility, through continuous engagement to fight unemployment and eradicate social exclusion. In fact, if properly managed, Co-operative banks can make the financial system more competitive.