samchain/econo-pairs-v1 huggingface dataset:
In terms of transparency of letting people see what banks are doing with their deposits or their investment, or generally what banks are doing to the country even if they have no money in the bank, because this may well be important to them, we are having some difficulties since the old law was drafted with secrecy sort of more predominantly in mind than other features. In the new law, we will have no real difficulties but we are still trying to go through the exercise of finding some enabling clause in the present laws to allow us to enforce the banks to announce their NPL, related lending, fines and penalties at the end of every month, and also to announce it ourselves for better impact. This will take some time because the lawyers in the central bank and those from outside helping us with various operations at the moment differ over our ability to do this. But we intend to do it as soon as we can rather than later. In the general area of governance, things are also moving. The electronic commerce law and the electronic signature law have just passed the Cabinet. Whether it will pass Parliament in its last year of its life depends on whether the Government wishes to rush a lot of legislation through or whether it will delay them for fear of losing the election. I am inclined to think that it will be the former, as the Government does need more positive results to enhance its electability.

I will mainly therefore in my talk today direct my remarks mostly at the problems of good governance, competitiveness, transparency, righteousness and public policy in the private sector, in the government and in the financial system. I shall also mention specific situations which, though in the long term would not be significant, in the short term could upset the pace of the recovery and unsettle the good macroeconomic situations that we find ourselves in as I have just mentioned. Let me first pick a simple governance and transparency topic, our homepage. In the financial sphere, we have been trying to improve governance and transparency by improving the information available so that the decision-makers, be they financial institutions, foreign investors or locals may have easy access to accurate information and in so doing will become better decision-makers, whilst the transparency and availability of information on particular topics will force better behaviour by peer group behaviour or public pressure as the case may be. We have been improving the homepage tremendously in the last couple of years and the extent of information available, as quite a lot of people say, is good. But we still find, I still think, very much wrong with it. Firstly it is not very user-friendly. The format is amateurish and there are no “search” and “help aid” for users.
Figure 9: Markets expect Bank Rate to remain low for some time UK nominal OIS forward rate curve  The MPC gave new guidance in August, which we repeated in our September minutes, that we did “not intend to tighten monetary policy until there is clear evidence that significant progress is being made in eliminating spare capacity and achieving the 2% inflation target sustainably”. That guidance was a significant step and is likely to become more significant as time goes on. It provides a commitment not to tighten policy until we’re confident that it is appropriate to do so and that we have seen clear evidence that we are well on the way to recovery. It reinforces current market expectations that Bank Rate  Sources: Bloomberg Finance L.P and Bank calculations  More recently the Bank’s Covid Corporate Finance Facility, acting as agent for HM Treasury, has purchased commercial paper amounting to around £ This is not a monetary policy scheme but the MPC takes its size into account when taking its monetary policy decisions. 12 Andrew Bailey addressed these questions, as well as coining the “big and fast” terminology, in his recent speech at Jackson Hole, available at https://www.bankofengland.co.uk/-/media/boe/files/speech/2020/the-central-bank-balance-sheet-as-a-policy-tool-pastpresent-and-future-speech-by-andrew-bailey.pdf. The FPC has noted the importance of taking remedial action to ensure the resilience of the financial system, as well as of re-examining central bank facilities, including in the Summary and Record of its most recent meeting, available at https://www.bankofengland.co.uk/-/media/boe/files/financial-policy-summary-and-record/2020/october-2020.pdf.

And I will frame my contribution in terms of the use the MPC has made of what has come to be known as the “monetary policy toolbox”: the range of policy tools that MPC has used so far, what tools are available to us now, and which ones we might decide to use in the near future. The idea of a range of monetary policy tools is itself quite a new one. For many years monetary policy makers used one tool, the policy rate, to achieve their goal – in the UK case, that meant Bank Rate. And the Bank used a small, focused set of central balance sheet operations to keep money market rates, and so rates in the wider economy, close to that policy rate. Two developments changed all that: first, the secular decline, over several decades, in the trend real interest rate; and second, the global financial crisis and the great recession that followed it. 1 The trend real rate – big R*, in central bankers’ jargon - has fallen over the past few decades across advanced economies. Figure 1, taken from the August 2018 Inflation Report, sets out the MPC’s view of what explains that fall. Much of it can be explained by structural factors such as an ageing global population, which have raised the demand for savings. Other structural factors, including a decline in trend productivity growth, have reduced businesses’ demand for capital.
This created a new norm for monetary policy. Sweden then became one of the first countries in the world to conduct monetary policy with a floating exchange rate and an explicit inflation target. The decision to word the monetary policy target in terms of a particular figure was made for several reasons. Perhaps the most important reason was to create an anchor that everyone would recognise and on which they could base their expectations. A clear target would also make it easier to evaluate the Riksbank’s operations and to hold it accountable. As I said, this is particularly important as the Riksbank has such a high degree of independence. In 1999 the target of low and stable inflation was written into the Sveriges Riksbank Act. In connection with this, the Riksbank was also given greater independence, for instance, in that decisions on the repo rate would be taken by an Executive Board consisting of six members. Interest rate decisions were previously made by the Governing Board, whose successor, the General Council, now has the main task of appointing the members of the Executive Board. The six members of the Executive Board are also forbidden by law to seek or take instructions when making monetary policy decisions. The legislation is largely in line with the applicable legislation in other parts of the EU. These changes have contributed to further strengthening our credibility.

Only in this manner electronic payment advantages and all other facilities will be equal to you and to all the public in general throughout the territory of the Republic of Albania. I believe, in the spirit of this reasoning, we shall establish real opportunities for a harmonised geographical progress, providing a concrete contribution to the growth of country’s welfare. 2  BIS Review 6/2005
A stable financial system is also one that is able to manage risks that may harm its performance, and consequently that of the economy, and that should be able to absorb shocks without impairing its operations. The Bank carries out this task through the regular monitoring of the financial system, as well as of the domestic payment and securities settlement systems. The Bank’s findings are shared with the Malta Financial Services Authority (MFSA) and with the Ministry of Finance. The Authority is responsible for the prudential regulation and supervision of all financial institutions in Malta, while the Bank remains the lender of last resort. It is, therefore, the only domestic institution with the capacity to inject liquidity into a troubled institution against collateral. The Ministry of Finance, on the other hand, is involved with respect to the possible use of public funds. As the international financial crisis unfolded, the Bank was in continuous contact, at the highest levels, with both the MFSA and with the Ministry of Finance. It also took steps to obtain more frequent balance sheet data from credit institutions. The Government on its part gave a commitment to protect financial institutions and depositors in Malta should the need ever arise. Meanwhile, and in the light of similar steps taken elsewhere, it decided to raise the guarantee provided on bank deposits to EUR100,000. Here I would like to remind this audience that the relevant EU Directive emphasises that the cost of financing such guarantee schemes must be borne by the credit institutions themselves.

Indeed, firms in the automotive sector have already been hit, while the bleak outlook for the UK economy in particular is likely to have a negative impact on tourism. As the export sector comes under pressure, this will have an adverse effect on domestic demand. Accordingly, the Bank’s growth projections for 2009 have been revised downwards to under 2%. This, in turn, could have repercussions for the banking system as asset quality deteriorates. Second, partly because of the small size of the economy, bank loan portfolios are highly concentrated. More specifically, domestic banks are exposed to the construction, mortgage and property development sectors directly to the extent of over 50% of total loans, and in the  BIS Review 155/2008  3  form of collateral securing other lending. Recent international experience shows that strong increases in property prices fuelled by rapid growth in credit are unsustainable. House prices cannot rise faster than incomes indefinitely. Otherwise, housing simply becomes unaffordable. The Bank’s property price index – which is based on advertised prices – fell moderately on a year earlier during the September quarter. While domestic banks have been more prudent than banks abroad, however, the continuing high dependence on property as a driver of credit growth, and as collateral for other lending, remains a source of risk. At the same time, it is important to reiterate the strengths of the domestic banking system.
Among the future challenges that are likely to confront Asia is the sustainability of our prevailing growth model given the consequences arising from the erosion of our demographic advantage, the rising indebtedness, the rising cost of living despite an apparent period of low inflation, the need to meet the massive infrastructure requirements and the need to address the rising income disparities and the environmental challenges. What then are the ways economic management can prepare us for the future? This will involve policies and reforms that will reduce leverage, that will address the widening BIS central bankers’ speeches  3  income disparities, that will effectively manage infrastructure development and urbanisation, that will accord environmental sustainability and finally that will accord importance to governance, accountability and integrity in the implementation and execution of the many endeavours to achieve a sustainable advancement. This implies an important role of institutional building that will support the ability to address these challenges. For most Central Banks in the emerging world, our mandate is broader. Most certainly we are expected to have a role in contributing to addressing many of these challenges both directly and indirectly. Some of these issues include financial inclusion, financing of infrastructure, putting in place financial and social safety nets, and environmental sustainability.

In most emerging market economies, the mandate of the Central Bank is generally broader beyond monetary and financial stability to include development of the financial system to ensure effective and efficient functioning of the financial system, financial inclusion to maintain balanced growth and more recently preserving the environment to secure sustainability of our progress and development Special role of Central Banks in emerging economies Allow me to focus on the special role of Central Banks in emerging economies. Central Banks in most emerging economies are frequently called upon to have a role in the development of the financial system. A well-developed and robust financial system constitutes an essential foundation for sustainable economic growth as it enhances the efficiency of financial  2  BIS central bankers’ speeches  intermediation, contributing towards lower transaction costs and increased competitiveness. Many Central Banks have drawn up masterplans and blueprints for this purpose. The key building blocks are the strengthening of financial infrastructure, such as the payments and settlement system, the development of money and bond markets and in the implementation of financial reforms involving the deregulation and greater market orientation and liberalisation resulting in greater integration with the global financial system. Central Banks in many emerging economies are also tasked with promoting financial inclusion. Greater financial inclusion is a key component for an economy towards achieving a more balanced growth and thereby increasing the prospect for a more sustainable growth. What are the factors that have allowed Central Banks in the emerging economies to perform these roles?
If, as expected, second round effects remain contained, the rate of inflation should drop back below 2% during the course of 2009, and long-term inflation expectations should remain low. Based on these assumptions, current monetary policy is appropriate. However, if inflation does not fall back due to second round effects as expected, the SNB would need to counter this development in order to anchor price stability. BIS Review 103/2008  1

With this correlation, the tendency in the data is for bonds to rise in value when equity prices fall. Chart: Correlation between equities and bonds There has been a marked change in the correlation between equity and bond returns in recent years. In the period from the early 1960s to the end of the 1990s, the correlation between equities and bonds was positive. This trend has reversed. Since the beginning of the 2000s, the correlation between equities and bonds has generally been negative. This shift is clearly reflected in the chart, which is based on the correlations between US equities and bonds. The same shift is evident in the financial markets of a number of other countries. The decline in the correlation has received considerable attention in the financial literature.3 It has been suggested that this change may be the result of a shift in monetary policy in many countries 4/7  BIS central bankers' speeches  towards giving greater weight to stabilisation of the real economy in the face of supply side shocks. This means that there is now some divergence in response between equity and bond markets to this type of macroeconomic shock. This type of shock has also occurred less frequently in the past couple of decades. A lower correlation means that bonds reduce the risk associated with equity investments more effectively than earlier. Investors may thereby be willing to accept lower expected returns on bonds with long maturities.
Martin Flodén: My view of monetary policy and household debt Speech by Mr Martin Flodén, Deputy Governor of the Sveriges Riksbank, at Swedbank, Stockholm, 24 September 2013. *  *  *  This is my first speech since taking up the post of Deputy Governor of the Riksbank. Since I started in the spring I have taken part in two monetary policy meetings. On both occasions I have entered a reservation against the majority decision and advocated a lower repo rate. It therefore seems natural for me to devote my speech today to explaining my view of monetary policy and the reasons for my reservations. Should monetary policy take into account households’ high and rising indebtedness? This is a question that has been central for monetary policy in recent years and also at my first monetary policy decisions. I consider it clear that the Riksbank has a responsibility to safeguard financial stability and prevent crises linked to credit granting. However, it is not so clear what consequences this responsibility has with regard to conducting monetary policy in practice. I shall explain my reasoning at the recent monetary policy meetings. I also intend to comment on how the new framework for macroprudential policy may affect my view of monetary policy. However, I shall begin with a brief description of my view, and the Riksbank’s view, of the economic situation. Positive signs but risks remain In recent months we have been able to see some positive signs in the Swedish economy, and also abroad.

A more detailed description will be provided by Professor Lars Jonung. Economists of the time could not, based on historical evidence, predict that national and international monetary systems would be facing substantial disturbances that would push up the price level considerably and lead to extensive instability. With the First World War, the gold standard was suspended and the money supply and price level rose sharply. The deflationary policy of the 1920s brought the price level down, but probably also contributed to instability. The price level rose again during the Second World War, when the occupying powers used the printing press to finance a substantial portion of their expenditure. The economic policy of the 1970s and 1980s contributed to high inflation. So, how well would economists in 1905 have predicted the Norwegian level of real income in 2005? BIS Review 43/2005  1  They would have been off the mark here too. They were not in a position to predict that the growth rate in the Norwegian and global economies would rise as a result of considerable technological progress, restructuring and higher productivity. On the other hand, they could to some extent have predicted our current industry structure based on their economic history. From 1865 to 1900, primary industries’ share of total GDP fell from about 34 per cent to 22 per cent. In the same period, manufacturing, other goods production and service industries accounted for an increasing share of total GDP.
Spain had an oversized banking system, excessively concentrated on lending to the residential property sector and highly dependent on international wholesale financing. In 2008, the consolidated assets of the banking system amounted to 304% of GDP, bank lending to the property sector (in the broad sense of the term) reached 99% of GDP and bank debt held by non-residents accounted for 24% of GDP. Moreover a significant number of deposit-taking institutions suffered from institutional and governance shortcomings. Over the last decade many of these vulnerabilities have been resolved; in particular, those relating to the high level of non-financial private sector debt, which is now at levels similar to those in the rest of the euro area (having fallen by almost 70 percentage points of GDP from its peak in 2010). The weight of lending to property and construction activities has decreased by 47 percentage points of GDP. This reduction in non-financial private sector debt has been reflected in a decrease in the size of the financial sector and, in particular, in bank balance sheets in Spain, since business abroad has proved to be one of the main determinants of the resilience of some institutions. Thus, over the last ten years, the total assets of business in Spain have contracted by 20% (a fall of 72 percentage points of GDP) and employment in the sector has fallen by 32%.

However, if the resolution is carried out by means of a bail-in, there must be arrangements in place in case, when the doors open, some of the funding providers decide to withdraw their funds, because they have been affected by the bail-in, because they believe the bail-in has not been sufficient, or simply because they prefer not to run the risk of waiting to see what happens to the institution. In such cases it is essential to ensure that there are sufficient mechanisms in place to provide the institution with liquidity, to grant credibility both to the resolution tool and the resolution process. In view of how other advanced countries have solved this problem, the solution, in my opinion, could be to involve the central bank as a funding provider, with all due public guarantees provided jointly. However, if any or all of the guarantees were to be enforced, it would be important to ensure the fiscal neutrality of the mechanism in the medium term. Third, insolvency regimes in Europe must be harmonised. If we have common supervision and resolution schemes for banks in Europe, I believe we should also have harmonised arrangements for winding up banks. This would require having a separate insolvency regime for banks, given their idiosyncrasies and the negative externalities that lengthy and inefficient winding up processes may have for other banks, deposit guarantee schemes and the real economy. This should be a common insolvency regime for all the countries of Europe.
In March 2000, the group issued a sobering reminder: institutions that provide leverage to HLIs must improve their counterparty risk management and hedge funds need to enhance their disclosures. Along with these developments, or some say in spite of them, the hedge fund industry has continued to grow from strength to strength. There are now about 6,000 hedge funds worldwide, managing more than $ billion. In 2001, some $ billion of new capital was invested into hedge funds. By 1 comparison, the entire industry was only $ billion in 1990 . While high net worth individuals remain the main source of capital, hedge funds are becoming more popular among institutional and retail investors. Funds of hedge funds and other hedge fund-linked 2 products are increasingly being marketed to the retail market . For example, ABN Amro launched the first retail fund of hedge funds in Singapore last month. There are a number of factors behind the meteoric rise in demand for hedge funds. The unprecedented bull run in the US equity markets during the 1990s swelled investment portfolios. This led both fund managers and investors to become more keenly aware of the need for diversification. Hedge funds are seen as a natural “hedge” for controlling downside risk because they employ exotic investment strategies believed to generate returns that are uncorrelated to traditional asset classes.

Yeo Lian Sim: Hedge funds - a mainstream alternative Keynote address by Ms Yeo Lian Sim, Deputy Managing Director (Market Conduct) of the Monetary Authority of Singapore, at the Hedge Funds World Singapore 2002, Singapore, 19 September 2002. *  *  *  Good morning, Ladies and Gentlemen  A decade of controversy and rapid growth Ten years ago this month, speculation that Europe’s Exchange Rate Mechanism (ERM) would be realigned gained momentum and the British pound came under intense pressure in the foreign exchange markets. The rest, as they say, is history. Hedge funds have come a long way since the Sterling attack. They have been linked to other instances of market turmoil, like the Mexican Peso meltdown in 1994-95 and the Asian financial crisis of 1997-98. Studies have revealed little evidence that hedge funds were mainly responsible for those episodes. But their participation is not in dispute. Also in 1998, we saw the near collapse of Long Term Capital Management and its subsequent recapitalisation by a consortium of banks brought together with the help of the New York Fed. The incident raised questions about the risks that large and highly leveraged hedge funds pose to systemic stability. It was to address these concerns that the Financial Stability Forum (FSF), of which Singapore is a member, set up a working group on Highly Leveraged Institutions (HLIs).