samchain/econo-pairs-v1 huggingface dataset:
More generally speaking, the evidence suggests that the reallocation of capital from declining industries to industries with high investment opportunities and high productivity is faster in countries with developed financial markets. These findings suggest that countries with more liquid capital markets and a developed banking system are growing faster on average. 15 Increasing product market competition – at the EU and national levels – would enable more efficient production structures. The benefits of opening network industries to competition can be seen in the telecommunications sector. The hourly labour productivity in this particular sector saw a significant acceleration from 4.5% to 7.3% from the periods 1980-1995 to 1995-  11  See the ECB Occasional Paper Series No 44 “Competition, productivity and prices in the euro area services sector”, by the Task Force of the Monetary Policy Committee of the ESCB, April 2006. 12  European Commission, “The single market: review of achievements”, November 2007. 13  Today, the services sector accounts for 70% of GDP, 68% of employment and 96% of the new jobs created, but only 20% of intra-EU trade. This discrepancy reflects not only the fact that services often have an intrinsically local character, but also the many barriers and obstacles still hindering the free movement of services within the European Union.

Moreover, in those European countries and regions where competitiveness has been lost in the past and/or the unemployment rate remains too high, it is important that wage increases do not fully exhaust productivity gains in order to provide incentives for firms to create additional jobs. In this respect, sufficient wage differentiation is also required to improve the employment opportunities for less skilled-workers where there is high unemployment for this category of employees. The extent to which an increase in nominal wage growth leads to upward pressure on inflation depends crucially on trend labour productivity growth. Under normal circumstances, stronger labour productivity growth would justify an increase in nominal wage growth, thus allowing wage earners to participate in economic growth without adding to inflationary pressures. But, for the same reason, without sustained improvements in labour productivity, higher nominal wages would not lead to improvements in real purchasing power, but undermine job creation and fuel inflationary pressures. Against this background, the ECB’s Governing Council considers that, features enforcing wage rigidities and leading to nonoptimal wage setting – in particular indexation of nominal wages to the consumer price index – should be avoided. This is particularly accurate in this period where the euro area economy is currently in a juncture which is dominated by exogenous price shocks and uncertainty about the outlook of the real economy. Headline inflation which has been pushed up by external pressures on energy and food prices, is today significantly above 2% in the euro area and even higher in Spain.
The importance of the direct inflation effect is confirmed by empirical studies using Swedish data (Hopkins et al., 2009); inflation in Sweden is affected almost immediately when the repo rate is changed, and most of the inflation effect arises through the exchange rate channel.21 I note that in line with this reasoning, the krona strengthened after the Riksbank began raising the repo rate in summer 2010. And, as I pointed out earlier, it was after these reporate increases that inflation in Sweden – unlike other parts of the world – began to fall. 20  See Hopkins et al (2009) for a description of the transmission mechanism and empirical studies of how it works in Sweden. 21  The greatest effects on inflation between two quarters arise during the first quarter after a change in the repo rate, but it takes a year until the greatest effects are attained for the twelve-monthly inflation figures. 10  BIS central bankers’ speeches  Short-term inflation expectations are a component of the transmission mechanism that I feel are paid too little attention as a possible explanation for the low inflation. When firms set their prices, important factors are how they believe other companies will set their prices, and how they believe their customers will react to price changes. The same applies when employers and employees negotiate wages. If one believes that other companies will keep their prices and wages unchanged, it is more difficult to raise one’s own prices and wages.

17 SR 18–8: Interagency Statement on Sharing Bank Secrecy Act Resources, Oct. 2, 2018. 6/6  BIS central bankers' speeches
At the same time, it is common knowledge that the law has assigned most of the costs associated with granting a mortgage to the institution. Some institutions have even decided 10/15  to assume the cost of appraisal as well, which is in practice the only one that the law places upon the customer. In addition, the requirements relating to the minimum number of instalments that must be due and payable before it is possible to initiate judicial enforcement proceedings, will delay the recovery of debt outstanding on non-performing loans, which will inevitably increase the costs of the foreclosure process. This will also initially have negative effects on the overall level of non-performing mortgage loans. Clearly, banks, like any other firm, can only survive if they are profitable. Consequently institutions must be able to measure the costs and risks associated with each new transaction. I would like to stress here that, to guarantee their viability and to be able to adequately remunerate their capital, each individual institution must have an appropriate pricing policy allowing it to cover all the costs and risks associated with each loan, and must establish governance structures and management processes that ensure effective management of such risks. When assessing solvency and assigning an appropriate price to each new transaction, institutions will have to optimise the use of the information available on their customers. For this purpose they need to have technological solutions enabling such information to be appropriately collected and used efficiently subsequently.

In fact, during the stage when structural imbalances were building up on bank balance sheets, institutions never failed to comply with the solvency requirements. A significant part of the response to the crisis has been based on regulatory changes to correct the design of the capital framework. However, apart from this traditional micro response, the introduction of the macroprudential viewpoint in supervision has been a notable development. The purpose of this perspective is to contribute to the correction of macrofinancial imbalances and improve control over the credit cycle, which should result in more stable and sustainable economic growth. A necessary condition to be able to develop this function is the early identification of macroeconomic imbalances and analysis of the interconnections between individual institutions and markets. As we all know, the Banco de España has been performing these tasks of identifying and monitoring financial system vulnerabilities since 2014 and, moreover, has the option of introducing countercyclical capital buffers. Consequently, one might ask what changes have recently been made to Spanish law and why they are relevant. First, a royal decree setting up a macroprudential authority in Spain was finally approved on 1 March. This needed to be done as Spain was the only EU country, apart from Italy, that had still not established such an authority.
The Riksbank’s assessment and decision in September At our most recent monetary policy meeting in September we could note that the situation in the world economy had continued to improve, although the strength of the recovery was still uncertain. The public finance problems in certain eurozone countries were still causing some concern and there was uncertainty over the consequences that stricter fiscal policy might have for growth in these countries. But compared with the situation in the spring and early summer, the unease on the financial markets had toned down, partly as a result of the stress testing of the banks by the EU during the summer. Growth prospects in the eurozone were in principle thought to be the same as at our meeting in June. However, we could note that the risk of slower growth in the United States had increased and we revised down the forecasts for US growth this year and next year. Nevertheless, we envisaged, as before, that the international economic climate would gradually improve. BIS Review 134/2010  1  We could also note at the meeting that the recovery in the Swedish economy had been more rapid than expected, and our assessment was that the Swedish economy would grow more quickly than, for instance, those in the eurozone and the United States. One reason for this, as I have just discussed, is that unlike many other countries, we do not need to tighten policy to correct large budget deficits and debt ratios.

Two points are worth mentioning at this stage: - First, due to the scepticism I already mentioned and for credibility reasons, it would have been damaging for the euro not to build on the credibility of the most efficient and successful participating national central banks, that had previously chosen 2% as the ceiling for their definition of price stability; - second, this criticism has abated recently and it is interesting to note that the definition of price stability has converged towards a level close to, if not below, 2%: in December 2003, Gordon Brown announced a new inflation target for the Bank of England, based on the HICP, and set at a level of 2% for the 12-month increase; in the US, Ben Bernanke, recently appointed to take over A. Greenspan at the end of the month, advocated for a quantitative definition of the FED’s price objective comprised between 1 and 2% over the medium-term. 2.2. The Eurosystem’s monetary policy is “medium-term” oriented. What exactly are the implications of the medium-term orientation of the Eurosystem’s monetary policy strategy? The first is that the single monetary policy does not have a fixed horizon, defined once and for all ex ante, but aims, as far as possible, to take account of the “long and variable lags of monetary policy” dear to Milton Friedman.
BIS Review 31/2008  1  Modern sovereign wealth funds are not new, in fact the first – the Kuwait Investment Office – was set up here in London in February 1953 – just as Edmund Hillary and Tenzing Norgay were setting out to climb Everest. 2 And the number of funds has been increasing since then like the traffic on the slopes of Everest. The next wave were set up by other oil producers after the price increases in the 70s and 80s for persuasive reasons (Chart 2). First oil is a non-renewable resource so it can make sense for governments to spread the benefits of this endowment across generations by investing part of today’s income in assets that will provide an income tomorrow. That would be so even if the path of oil prices was predictable but in fact it is not. That uncertainty about future income provides a second case for saving today. In the late 1970s, some oil exporters increased spending to match higher incomes and faced a painful adjustment when prices fell back again. Third, even if the rise in income was permanent there would be a case for phasing the growth of domestic spending and investment to prevent supply bottlenecks leading to inflation. Recent growth of SWFs Since the millennium at least 10 new SWFs have been set up and there are reports of plans for more for example in Brazil, Japan and India. This reflects the remarkable shift of emerging-market economies from debtors to creditors.

And are the potential vulnerabilities of the networks they help to create properly understood and contained? Threats can emanate from many areas: and you can see we could keep armies of people active scanning the horizon in real-time. We have all heard about the butterfly’s wing-beat in Bali causing a hurricane in the Gulf of Mexico. And we all know that there are lots of butterflies! So we need to have some way of distinguishing between those threats which are of real significance and danger and those which are less pressing or more remote. What we do is to subject each of the potential threats that we can identify to regular scrutiny. So we prioritise the areas where we see real problems emerging, or weaknesses which make us think that the infrastructure could buckle under shocks. But it is not sufficient just to be aware of the threats; we need to take action to mitigate them. Our second objective is, therefore, to do what we can to strengthen the financial infrastructure. And we design deliverables - work programmes and projects - to address important emerging dangers. Each deliverable will imply a response of some type. Let me give you some recent examples of work we’ve been involved with. On the domestic front, we gave just completed a programme to dematerialise Money Market Instruments. These are now integrated into the main CREST settlement system, enhancing market infrastructure and thereby reducing potential settlement risks. The settlement of transactions in these instruments can now occur with Delivery-Versus-Payment.
The ultimate assessment is, as mentioned, a result of Norges Bank’s professional  9  The estimation is based on a one percentage point increase in the interest rate, followed by a gradual reduction in line with the response pattern in the model. The analysis shows the impact of the interest rate increase on mainland GDP for Norway and inflation adjusted for tax changes and excluding energy products (CPI-ATE). 6  BIS central bankers’ speeches  judgement and will also capture considerations that are not sufficiently safeguarded by our models. As such, the models are only a tool. But, a model such as NEMO is a very useful tool for analysing developments and in interest rate setting. It helps us interpret and understand the dynamics of the Norwegian economy. The model apparatus is continually being developed. Among other things, we are exploring how financial markets and the linkage to the real estate market can be incorporated into such a model. Norges Bank’s response pattern expresses the assessments we make and how we set the interest rate to attain our objectives. We must use professional judgement and our experience of how the Norwegian economy functions. We attempt to incorporate our response pattern into NEMO by setting the interest rate in the model so as to stabilise inflation at target while reducing fluctuations in output and employment. The model can in this respect be a tool for ensuring consistency over time when we set the interest rate.

I would like to take this opportunity to make some remarks on these two issues, but let me start first with some considerations on the developments, outlook and challenges of Asian countries in the context of the present financial turbulence. Notwithstanding the cloudy and uncertain outlook we face now, global economic activity held up extremely well in the course of 2007. World growth reached almost 5%, completing the four-year period of highest growth since the sixties. Industrial economies grew near 3% last year, whereas emerging markets crucially contributed to this extraordinary performance recording an impressive 7.5% annual rate of growth. Taking into account their increasing weight in the global economy, this means that emerging markets explained more than two thirds of the global growth in 2007. Emerging Asia was a key contributor to this buoyant performance of emerging markets with an increase of GDP of almost 9%, driven by the two largest economies in the region: China and India. China's expansion of over 11% explained 25% of total world growth and India close to 9%. As I will develop in a few minutes the growth performance of these two countries is a key factor to assess the global perspectives. Where are we now? This year has started on a rather slow motion and the mood is far from positive. The economic and financial strains in the US and their spillovers to other advanced economies are dragging down global economic forecasts.
Alternatively, could it encourage an FMI to endeavor to return to normal operations prior to assurance of complete confidence in and sanitization of a production environment? To put it plainly: could the 2-Hour RTO unwittingly exacerbate rather than assuage the impact of a severe 2/5  BIS central bankers' speeches  disruption and/or impede prospects for recovery? Reflecting upon these important questions, allow me to offer the following practitioner’s interpretation, which I hope maximizes the value of the intent of the 2-Hour RTO while minimizing the downside risks of its mis-application. Rather than spending valuable time and industry resources re-litigating established supervisory guidance, we should consider the 2-Hour RTO as a vital organizing objective for planning purposes in peacetime, an aspiration to mobilize our best critical thinking to achieve, rather than an inviolable requirement that must be met in all circumstances recognizing the fog of war. A common understanding of this nuance across policy makers, supervisors, and operators strikes me as an important step forward both to focus our resiliency preparations in advance of an extreme event and to promote sound decision making in its remediation. Provocative Question Number 2: To what extent does the proliferation of risk management and information security frameworks to which FMIs must comply risk creating a “check the box” mentality to security and resilience that diverts resources and management attention from other critical initiatives?

ASEAN, with its half a billion people and a combined GDP of more than $ trillion, will then be a competitive investment proposition. ASEAN leaders will also sign the landmark ASEAN Charter which will transform ASEAN into a more cohesive, effective and rules-based organisation. BIS Review 124/2007  3  Singapore: remaking itself As Asia rises, Singapore will not content itself with being lifted by the rising tide. It will continuously remake itself – strengthening the hull, refitting with a more powerful engine, refurbishing the interior, acquiring new knowledge and learning new skills. To reduce dependence on the global electronics cycle, we have built strong growth momentum in areas such as financial services, tourism and biomedical sciences. Our growth will increasingly stem from knowledge- and innovation-intensive activities. This necessitates more investment in human resource development and the creation of a workforce capable of keeping up with the demands of new economic activities. Singapore is therefore planning to build a fourth publicly funded university. Concurrently, we are enhancing our connectivity with our major economic partners and increasing our economic space through FTAs. We have FTAs with 11 countries, including the US, India, Japan, South Korea, Australia and New Zealand. Negotiations are underway for 11 more, including agreements with China and the Gulf Cooperation Council (GCC). These FTAs will enable investors and businesses to leverage on Singapore to reach out to our FTA partners. We will press on to develop the financial sector.
In contrast to stress testing exercises, a real liquidity stress scenario does not have a well-defined and understood severity or duration – in reality there is no such a thing as perfect foresight. Banks may therefore rationally choose to exercise caution in their use of liquid assets due to uncertainty around future shocks and their duration. [32] In general, while a combination of factors is likely to be relevant to banks’ liquidity risk appetite, these factors often may not only reflect genuine concerns about liquidity, but also reflect concerns around impacts on the LCR metric itself. And there is a number of reasons why focusing on the LCR – or indeed any individual liquidity metric – in stress is unhelpful. Liquidity risk can manifest in a variety of ways, for different reasons – and can be fast-moving and self-fulfilling. So any static liquidity stress scenario has limited value in understanding the forwardlooking risks facing a bank when a real stress hits. This is less true for regulatory capital and real solvency stress, especially in a world where regulators constrain both leverage, through a non-riskbased leverage ratio, and risk-based solvency risk, through risk-weighted capital requirements and perform regular stress tests. Page 10  The denominator of the LCR – the measure of liquidity risk we use to ensure banks hold sufficient liquid assets – is not straightforward to understand, and is particularly challenging to interpret when stress hits.

Chiarotti, Mathur, and Rajan (forthcoming), ‘Assessing Basel III: Impact of automatic distribution restrictions on regulatory capital and bank lending’, Bank of England Staff Working Paper. The authors apply a difference-in-difference approach to aggregate bank balance sheet data and granular loan-level data on syndicated lending to corporates. The latter allows the authors to control for important unobservable features in the aggregate data such as changes in credit demand and in borrowers’ risk. 12. To ensure that banks which have different concerns about MDAs nevertheless have similar probabilities of triggering the restrictions, the analysis considers also the banks’ capital surpluses to regulatory buffers. 13. During the Covid-19 pandemic, several jurisdictions including ECB/SSM Fed and BoE recommended banks to restrict or suspend dividends and share buybacks, but not AT1 coupons (see Svoronos and Vrbaski (2020) (2021)  and BCBC  ). 14. During the pandemic AT1 coupons were excluded from the scope of the blanket distributions restrictions that many jurisdictions imposed, so unlike for dividends banks’ ability to pay AT1 coupons was still linked to automatic distribution restrictions thresholds. 15. A somewhat extreme version of broad-based capital conservation – reflecting the unusual and extreme level of economic and market uncertainty at the time - was implemented during Covid-19 when PRA recommended the major UK deposit takers to cancel dividend payments, share buybacks and cash bonuses. 16.