samchain/econo-pairs-v1 huggingface dataset:
31 The model assumes a linear relationship between bank capital and GDP-at-risk. This assumption should be treated as a local approximation and is unlikely to be realistic over wide ranges of capital ratios. In particular, increases in systemwide capital levels from current high levels will ameliorate tail risk by less than similarly-sized increases when capital levels are relatively low, as they were in the immediate aftermath of the crisis. 27  All speeches are available online at www.bankofengland.co.uk/news/speeches  27  𝑇  min ℒ𝑡 ≡ 𝐸𝑡 {∑ 𝛽 𝑖 [𝑓(𝐺@𝑅𝒕+𝒊 ) − 𝜙𝑦𝑡+𝑖 ]} 𝜌𝑡  𝑖=0  However, globally more than $ trillion of assets are now held in open-ended funds that offer short-term redemptions while investing in longer-dated and potentially illiquid assets.32 And funds with these structural mismatches are growing rapidly. This liquidity mismatch creates an advantage to investors who redeem ahead of others, particularly in stress. This “first mover advantage” could prompt a destabilising rush for the exits, not only in the market where problems first occur, but also across markets with analogous risks. Fund suspensions, a widely available tool, exacerbate the issue. Charts 19 and 20 illustrate that outflows from open-ended funds are indeed more sensitive to fund performance when funds hold more illiquid assets, and when market conditions are worse. Although risks have, so far, only crystallised within some niche managers and smaller markets, and their impact has been contained, these risks have the potential to become systemic if funds’ holdings of less liquid assets continue to grow.

The FPC’s responsibilities are encoded in the Bank of England Act and the Chancellor’s annual FPC remit letter.7 The FPC’s primary objective is to identify, monitor and take action to remove or reduce systemic risks with a view to protecting and enhancing the resilience of the UK’s financial system.8 Subject to meeting their primary objective, the FPC has a secondary objective to “support the economic policy of Her Majesty’s Government, including its objectives for growth and employment”. The emphasis on supporting economic growth over the medium to long term is underpinned by the so-called “stability of the graveyard clause” in the Bank of England Act, which does not “required or authorised the Committee to exercise its functions in a way that would in its opinion be likely to have a significant adverse effect on the capacity of the financial sector to contribute to the growth of the UK economy in the medium or long term”. The FPC’s actions support its secondary objective in several ways. The FPC minimises the negative impact of financial stability policies on growth including in the near-term by implementing financial stability policies gradually, and by choosing targeted policy tools. The FPC’s remit letter also tasks the FPC with taking actions to promote actively productive finance and growth as long as these actions do not compromise the primary objective of financial stability. These actions 7 The Chancellor’s annual “Remit and Recommendations” letters to the FPC, alongside the FPC’s responses, are  available here.
The existing money market infrastructure managed by SIX has many advantages: for instance, it has a wide range of participants, including the SNB, who make up a homogeneous market and interact on a shared platform. Moreover, that infrastructure is highly automated and standardised. It is in the process of being upgraded, to better respond to the changing needs of participants. A new repo trading platform, CO:RE, was launched in 2016. Moreover, a new triparty agent is being set up which will offer market participants a wide range of services and will enable a more efficient management of collateral through closer integration with pure trading activities. Page 7/9  Finally, a resilient and modern repo market infrastructure is essential to allow the SNB to deploy its entire monetary policy toolkit effectively and at any time. Indeed, the SNB uses the same SIX platform as private participants to implement its monetary policy, by auctioning/exchanging repos or reverse repos or even issuing SNB Bills. As you will recall, the latter were issued at the beginning of the crisis. They proved to be an efficient and flexible way to absorb liquidity. I will now turn to the second point: the replacement of the Libor as the reference money market interest rate. It should be noted that the decline in transaction volumes for the unsecured segment of the money market involves not just the Swiss franc but all currencies.

Although economic developments are favourable, inflationary pressures remain low. Moreover, the Swiss franc remains highly valued and the situation on the foreign exchange market is still fragile. Against this backdrop, the contours of a ‘new normal’ are emerging for central banks. While there are still many significant unknowns in the political, geopolitical and economic arenas, one thing is certain: the environment in which the central banks operate has evolved considerably, mainly due to structural changes. Some of these changes had already begun well before the crisis, but they have accelerated in the intervening period. I am thinking here of the digitalisation of the economy, for example, as well as the emergence of new technologies on the financial markets. In this speech, I would like to outline how the SNB has had to adapt – and continues to adapt – to make sure it is always in a position to fulfil its mandate.
Page 6  In the UK at least, such ‘taming’ of the challenges we face in achieving price stability has yielded a quarter of a century of improved macroeconomic performance, with inflation much lower and more stable on average than in the decades prior to the introduction of inflation targeting. There is much to admire in that. Moreover, the unacceptably high inflation we now face as a result of geo-political developments and their impact on commodity prices should not detract from what has been achieved over the entire span of the inflation targeting era. Indeed, the anchor provided by the inflation target for both the formulation and communication of monetary policy is all the more valuable when price stability is being challenged by adverse external shocks. But we also need to be wary that ‘taming’ of the problem does not lead us astray. In particular, we need to recognise that solving the inflation targeting ‘puzzle’ by returning CPI inflation to 2% at a specific point in time does not, of itself, represent a comprehensive or complete solution to the underlying problem of achieving price stability. [10] It is not ‘job done, we can now move on’ to other issues. On the contrary, to paraphrase Thomas Jefferson: the price of achieving meaningful price stability is eternal vigilance. For one of the characteristics of a ‘wicked problem’ is that it does not a have a ‘stopping rule’. In other words, it is not possible to say that a ‘wicked problem’ has been definitively solved, once and for all.

The ratio of vacancies to unemployment – which we consider one of the more reliable summary indicators of labour market tightness in recent years – fell to 0.9, from a peak of 1.1 back in August. That chimes with recent intelligence from our network of Agents and their corporate contacts across the country, which points to some easing in recruitment difficulties. Nonetheless, while pointing to some easing in recent months, these indicators suggest the labour market remains tight in an absolute sense relative to historical experience. In turn, this is consistent with continued strength in UK wage growth. Annual private sector regular pay growth[6] was 7.3% in the latest report, 0.1pp higher than expected in the MPR, even if the momentum of wage growth may now be slowing. Turning to yesterday’s CPI data, inflation fell to 10.1% in January, from 10.5% in December. On the month, this mainly owed to an easing in services and fuel price inflation, although developments in historically very volatile components such as airfares counted for a large part of the former. Both the March and May MPC meetings represent points at which the Committee can again assess the implications of incoming data for the monetary policy stance, with the latter having the advantage of an updated comprehensive assessment in the form of the MPC forecasts.
Alongside this, changes to the incapacity benefits regime may well also have had the effect of bringing more workers into the market. The number of people under the age of 65 who are inactive because of incapacity is down by around 200,000 since mid-2008. For much of the post-war period, there has been in the UK a steady decline in the hours people have wanted to work. As income grew, the trend was to reduce hours and maintain income rather than to maintain hours and increase income. Not surprisingly, the largest fall in real pay since records began has reversed that trend; the evidence suggests that, as the economy has recovered, with lower real pay, many have sought to increase hours to maintain – or recover – income. That of course may well be a temporary effect and as and when real pay rises the pre-crisis trend may reassert itself. But it may be that this effect will last for some time yet. Another explanation for the weakness of pay despite the fall in unemployment might be that the pressure to catch up lost income is much weaker post recession than it has been in the past. Based on previous episodes in the UK, we might have expected a reduction in real incomes to result in increased inflationary pressure from the labour market.

7  The major UK banks on average now have total loss absorbency of around a quarter of their risk-weighted assets (RWAs) compared to an average end-state requirement of around 28% (including buffers). 8 While no measure is perfect, a range of market-based estimates suggest the implicit ‘too big to fail’ subsidy has fallen sharply since the crisis. Estimates suggest that the value of the implicit subsidy has fallen from around £ in 2010 to less than £ now – down around 90% http://data.parliament.uk/writtenevidence/committeeevidence.svc/evidencedocument/treasury-committee/capital-andresolution/written/69208.pdf 11  All speeches are available online at www.bankofengland.co.uk/speeches  11  If counterparties have confidence that resolution will stabilise a bank so that it can continue to meet its obligations, they will not accelerate actions that could frustrate a resolution to the detriment of all parties. And the public needs to have confidence that we have learned the lessons of the crisis: that we have acted to ensure that we have an alternative to the previous crisis where we had privatisation of bank profits in good times and the socialization of bank losses when things go wrong. 9  For that reason, the Bank committed to Parliament in April 2017 and in the Purple Book last October that from 2019 we would implement public reporting of banks’ resolution plans and our assessment of their effectiveness. This marks an important transition in the implementation of full resolvability in the UK.
Speech  Embargo 26 April 2019, 10.00 am  Monetary policy in the interests of the country as a whole 111th Ordinary General Meeting of Shareholders of the Swiss National Bank  Thomas J. Jordan Chairman of the Governing Board Swiss National Bank Berne, 26 April 2019  © Swiss National Bank (speech given in German)  Page 1/8  Mr President of the Bank Council Dear Shareholders Dear Guests A warm welcome to you all to our Annual General Meeting. Engaging with the general public across Switzerland is very important for us. It therefore gives me great pleasure to speak before you here today, and I hope I will have the opportunity to talk with as many of our shareholders as possible over refreshments afterwards. In my position as Chairman of the Swiss National Bank’s Governing Board, I receive a lot of correspondence from people throughout our country. In one such letter, the owner of a family business in northwestern Switzerland described how she had struggled for years to hold on to customers, only to have to now close down anyway as the strength of the franc has made competition from neighbouring countries simply too great. In another letter someone wrote that despite his having had to pay ever higher pension fund contributions over the past 15 years, there has been no increase in his projected retirement savings. In fact, they have even declined. He attributes this to what he refers to as ‘minus interest’.

Having interest rates slightly below zero does not mean the world has been turned on its head, nor does it run contrary to economic logic. Introducing the negative interest rate has on the one hand influenced the financing conditions in the economy. This has been to the benefit of companies, households and the public sector alike. Meanwhile, it also has an effect via the exchange rate, and this is particularly important for us as a small open economy. Charging negative interest reduces the appeal of Swiss franc investments compared with investments in other currencies, and thus plays a significant role in keeping the appreciation pressure on our currency in check. This in turn supports economic activity and is essential for price stability in the current situation. Exchange rates are, of course, also influenced by other factors. However, the comparison between yields on Swiss franc investments and those in other currencies is always an important criterion for investors when deciding which currency to invest in. Knock-on effects of low interest rates That being said, the low level of interest rates does also pose challenges and there are knockon effects. Savers in Switzerland are worried about their savings which are yielding barely any interest. Pension funds and life insurers are facing difficulties in meeting their contractually agreed obligations owing to the low level of capital market interest rates. And banks are concerned about their profitability since they are generating less interest income from their lending business.
In itself, a difference in the weight of a small state and a large state may make sense; but if certain EU member states have a much bigger informal impact than others on the positions that the EU takes in international political or economic forums, the big-impact states may be tempted to “nationalise” the voice of the EU. Many attempts at nationalisation of EU positions are due to what might be called the “French complex”: Some leaders of bigger countries still have not fully absorbed the fact that their country is no longer the superpower it used to be and no longer leads the world, so they often try to abuse their EU-wide voice to support their national interests, positions and agenda. When they call for Europe to speak with “one voice”, they often seem to expect that the single voice of 500 million EU citizens will be the voice of their national leaders, articulating their national tastes and priorities. Of course, the agent, the European Commission as an executive arm of the EU, also sometimes has this temptation to define or steal the voice of the EU. Needless to say, the risk that proper integration will be derailed is particularly high when the two effects mentioned above are combined – when the EU administration ceases to behave as an agent of the less powerful principals but remains under the spell of a few very strong principals.

Mojmír Hampl: European integration – a critical economist’s view Speech by Mr Mojmír Hampl, Vice-Governor of the Czech National Bank, at the Europe at Sixty: 1949–2009, Metropolitan University, Prague, 20 November 2009. *  *  *  Ladies and gentlemen, Let me first express my deep gratitude to the organisers for inviting me to give this keynote speech today. And do not take it as a standard, politically correct opening sentence. I really mean it. For me it is quite a rare opportunity to speak frankly and openly on such an important topic, which the process of European integration certainly is, and to speak more as a scholar than a policy-maker. So I will try to do my best and to be outspoken enough to provoke questions and comments after I finish. Therefore, the usual disclaimer is more relevant than ever this time: my opinions are not necessarily the opinions of my employer. I think European integration is a process that provides a lot of food for thought for many social scientists. I will try to approach the topic from the point of view of an economist, but also a citizen and a mere mortal, sharing with you some of my concerns as to how the process of European integration has been evolving so far and where it is most likely heading.
In fact, two areas that we recently reviewed that require attention include basic IT asset management and strengthening patch and vulnerability management practices. These are necessary hygiene steps and should be a fundamental for a sound cyber security defense program. As part of good risk management, firms also need to start considering how to assess the costs of cyber and connect the pricing of cyber risk to the businesses. You must ask yourself “what is my cyber exposure?” And, you need to think about how you should price it, because until cyber is priced, it may not get the attention it needs. 3. It’s not just the banks  Cyber isn’t just about the banks – it’s about the entire financial sector, as well as the connections between the financial sector and other sectors like the utilities, retail, and others. We know that every area of the industry is interconnected; and it’s not just financial firms. As the old saying goes, we are only as strong as the weakest link. In the financial system, that weak link could be a weak firm, a weak vendor, a weak point of vulnerability in a payments or clearing system, etc. A weakness in any of these areas exposes the entire system, because the interconnections mean that you are all linked to each other, to non-financial firms, and to every system that supports the operations and structure of the industry.

The additional risk to keep in mind here is the growing number of unregulated firms operating in and competing in this arena. As the industry moves to overcome the risks associated with cybersecurity, you have to consider the additional vulnerabilities you are exposed to through non-regulated entities that will not be subject to the same guidance and standards. The big question lies in how you, as an industry, ensure that the ‘industry as a whole’ is safe, not just regulated entities. 4. One size does not fit all  Just as firms are diverse in size, complexity and product offerings, so too are technologies, processes and systems. While some firms house all technology work internally, others outsource the entire function or a significant part of it to third-party vendors. In addition to the variety of systems used and approaches to information security within firms, as I said earlier, we have an entire subsystem that supports the financial sector and ultimately connects every firm to some extent. In response to this, we are working under the  4  BIS central bankers’ speeches  assumption that there will not be a one-size-fits-all solution and the approach taken will need to be comprehensive and flexible enough to be adopted by all types of firms. 5. We are in this together  Cybersecurity is an area where I believe our interests are aligned and our shared goal is twofold.
Birgir Ísleifur Gunnarsson: Update on Iceland’s economy Address by Birgir Ísleifur Gunnarsson, Chairman of the Board of Governors of the Central Bank of Iceland, at its Annual General Meeting, Reykjavík, 27 March 2001. *  *  *  On behalf of the Board of Governors of the Central Bank of Iceland I welcome you all to the Bank's 40th annual meeting. This year marks the Bank's fortieth anniversary after it was made completely separate from Landsbanki and transformed into an independent institution. The Bank's financial statements for the year 2000 have been ratified today by the Prime Minister. The Bank's annual report has also been published. As usual it includes a survey of the Bank's activities and performance, along with a detailed report on the Bank's monetary policy and actions, the financial system and financial markets, and the main features of economic developments in the course of last year. I shall now address several aspects of economic issues and the present prospects, in particular those most closely connected with the Central Bank's field of activities. Overheating of the economy Iceland has distinguished itself from most other industrialised countries in recent years by the strong economic growth it has enjoyed, or 4-5% per year. The closest comparison in this respect is with the USA, where growth is in fact on a downward path now.

Foreign demand continued to provide a positive contribution to the aggregate demand. Nevertheless, as expected, its positive impact was lower than a year earlier. During the first five months of the year, Albanian exports increased by 23.3% y-o-y, which is lower compared with 2010. On the other hand, deterioration of trade terms and internal demand performance triggered the increase of imports in the first half of the year. Value of imports increased 14.1% y-o-y during January–May, thus, leading to higher trade deficit. Following its narrowing in 2010, this deficit expanded by approximately 8.8% y-o-y during this period. Trade deficit expansion, negative foreign currency flows in the services account and lower remittances are reflected in the expansion of the current account deficit in the first quarter, at the end of which, this deficit was at 11.8% of the GDP, illustrating the fragile position of the external sector of the economy. The performance of the four demand components led to positive, but below potential, economic growth during 2011 H1. Unutilised capacities in the economy controlled production costs and generated controlled inflation pressures. Monetary indicator analysis confirms our assessments for contained inflation pressures suggesting that money supply growth rates are moderate and in line with the economy’s demand for real money. In average terms, M3 annual growth was 11.3% in January–May triggered by a steady growth of deposits in the banking system. Demand for money is dominated by public sector demand for funding, while the private sector’s demand was more moderate.