samchain/econo-pairs-v1 huggingface dataset:
The hallmarks of such a high communication level are curiosity about the other person’s views and the ability to broaden one’s views or change one’s mind as a result of discussion with others. This type of communication normally requires a high level of professional  18  This outcome assumes that each member of the group singly is more likely to arrive at the correct conclusion than the wrong one. 19  See James Surowiecki (2004): The wisdom of crowds. Little, Brown, London, pp. 3–4. This example was also cited in the speech “Uncertainty in macroeconomic policy making: art or science?”, which Mervyn King, Governor of the Bank of England, gave on 22 March 2010, and is available at: https://www.bankofengland.co.uk/publications/news/2010/034.htm . That we both use this example may not be a coincidence. I received my copy of The Wisdom of Crowds from Dr. John Llewellyn. Llewellyn and King were fellow students at Cambridge. 20  See Alan S. Blinder and John Morgan (2005): “Are two heads better than one: An experimental analysis of group versus individual decision making”, Journal of Money, Credit and Banking, 37, no 5, pp. 789–811 and Alan S. Blinder og John Morgan (2007): “Leadership in groups: a monetary policy experiment”, CEPS Working Paper No. 151. 21  Alan S. Blinder (2008): “On the design of monetary policy committees”, Norges Bank Working Paper, 2008/6. BIS Review 147/2010  5  competence, mutual sympathy and trust and a large degree of openness. The potential reward is better decisions by the group.

Ravi Menon: Introducing Mark Carney Introductory remarks by Mr Ravi Menon, Managing Director of the Monetary Authority of Singapore, at the 2014 Monetary Authority of Singapore Lecture, Singapore, 17 November 2014. *  *  *  Mr Mark Carney, Governor, Bank of England, Deputy Prime Minister and Chairman, MAS, Tharman Shanmugaratnam, Ambassadors, distinguished guests, friends and colleagues, good morning, Welcome to the eighth MAS Lecture. First held in 2000, the MAS Lecture has over the years featured several eminent members of the international financial community who have offered their perspectives on important economic and financial issues. Today, Mark Carney joins that distinguished band of leaders in finance, and it is my pleasure to introduce him. Carney has the rare distinction of serving as governor for not just one central bank but two: •  From 2008 to 2013, Carney was Governor of the Bank of Canada, playing a major role in helping Canada avoid the worst effects of the Global Financial Crisis. •  And since the middle of last year, he has been Governor of the Bank of England, the first time that a non-Briton has taken the helm of that hallowed institution in its 320-year history. •  Perhaps the transition was made easier by the fact that the appointments of both the Governor of the Bank of England and that of the Bank of Canada are made in the name of the Queen.
At that time they considered there was a case for cutting taxes and argued on the basis of estimated resource utilisation that this was feasible without risking capacity restrictions. Our estimations suggested otherwise, though the differences should not be exaggerated. We still do not know who was right. But what we do know is that economic activity has declined far more than any of us foresaw and this has been accompanied by higher inflation. Concluding remarks Now for a brief summary of what I have said. Economic policy as a euro participant is not all that different from economic policy today. When discussing stabilisation policy it should borne in mind that the best way for us to achieve a favourable development – inside or outside the euro area – is to create conditions for a smooth adjustment to various markets, primarily the labour market, and for a good productivity trend. In these respects there are measures we ought to take in any event. But euro participation can help us to move in the right direction. By adopting the euro we would relinquish our national monetary policy. That would make the formation of fiscal policy more crucial. There are risks here, as we know from our own experience in the 1970s and ’80s, when policy was neither consistent nor focused on the long term. As a result, cyclical fluctuations were accentuated and the government finances gradually weakened. That limited the room for action when Sweden entered the 1990s.

This market deals in maturities of less than one year, but the overwhelming portion of trading deals with securities with maturities of three months or less. Money market funds continue to be major investors. More long-term borrowing is largely conducted in euros through the issuance of covered bonds. Pension funds and insurance companies are the main investors here.2  Obviously, the risks of a bank entering into an acute liquidity crisis become smaller as borrowing becomes more long-term. Consequently, the new regulations in Basel III require a greater proportion of long-term borrowing than most banks have opted for so far. Unfortunately, before the crisis, it was highly advantageous to borrow dollars over the short term, and this was also exactly what the European banks did, including the Swedish ones. Borrowing for longer maturities was much more expensive. And as the new Basel regulations have not entered into force yet, there still exist significant incentives for the banks to borrow dollars over the short term. This applies to the Swedish banks in particular, who are also regarded favourably by the US market due to their strong balance sheets, particularly in comparison with a number of their European competitors. 2  In recent months, a couple of Swedish banks have actually succeeded in issuing covered bonds with maturities of 3–5 years in the United States. It would naturally be desirable to gain access to the market for longer maturities in US dollars, but I feel that the journey there would be both long and rough.
Fortunately the FSB – working with the Committee on Payments and Market Infrastructure (CPMI) and the International Organization of Securities Commissions (IOSCO) are doing just that. 11  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  11

A re-assessment of its implication on price stability indicated this appreciation was not compatible with our price stability target over the medium term. Under these premises, the Bank of Albania was forced to act. We lowered the policy rate to a new historical minimum of 1 percent. We clearly communicated the Bank of Albania did not assess this appreciation to be in line with fundamentals, anymore. Lastly, we announced the initiation of an FX purchase program in the domestic market. This program was aimed at controlling the pace of appreciation, removing the excessive short term FX supply and reversing expectations and one-sided bets in the market. In regard to this last one, I would like to emphasize the main features of it: First, it was undertaken as measure of last resort, when the space for further conventional policy rate cuts was limited. Therefore, any additional monetary policy stimulus would need to make use of unconventional instruments. Second, it was clearly communicated to the market to be of both an exceptional and a temporary nature. Therefore, it does not represent a shift from our commitment to a flexible exchange rate regime, and should not be represented as such. As a result, these measures proved to be efficient and now the exchange rate movements are going back to normality. Thank You! 3/3  BIS central bankers' speeches
Sarah Dahlgren: More resilient, better managed, less complex – strengthening FMUs and linkages in the system Remarks by Ms Sarah Dahlgren, Executive Vice President of the Financial Institution Supervision Group of the Federal Reserve Bank of New York, at the Securities Industry and Financial Markets Association Conference, Boca Raton, Florida, 29 April 2014. *  *  *  Good morning and thank you for inviting me to your Annual Operations Conference. This event brings together an important cross-section of market participants – and looking at the attendance, I think there is good representation of nearly every important part of the financial system in the audience. Today, I am going to talk about the progress that the industry has made to address weaknesses identified through the financial crisis and to build resilience to future shocks. I will also offer some observations on areas of remaining challenges, particularly as we focus on the interconnections between and among various market participants. As always, my remarks today reflect my own views and not necessarily those of the Federal Reserve System. It’s hard to believe that it’s been over five years since the onset of the worst part of the financial crisis – and I’m not sure whether it feels longer or shorter than that! But one thing I’m certain of is that a lot has changed in those five years, including fundamental changes in rules and regulations, as well as substantive changes in how firms and the system are structured and operate.

However, at the latest monetary policy meeting in April 2010 I chose not to advocate a lower repo-rate path but instead an “extended” repo-rate path. In this extended path, the period in which the repo-rate is 0.25 per cent is extended to the end of the fourth quarter of 2010 instead of to the end of the second quarter as the majority decided. I thus supported the decision to leave the repo rate unchanged at 0.25 per cent, but entered a reservation in favour of the extended repo-rate path. My reason for this was that such a repo-rate path has the same effects as the lower repo-rate path; that is a higher level of resource utilisation and a level of CPIF inflation closer to the target. 1 An expansionary monetary policy can thus be achieved either with a lower repo-rate path in which the repo rate is reduced now or with an extended repo-rate path in which the repo rate is maintained at a low level for a longer period of time. Some of my colleagues have had certain doubts about a repo-rate level below 0.25 per cent. As you know, I do not share these doubts. In this context, the extended repo-rate path has the advantage that these doubts are no longer relevant. It also has the advantage that it reduces the monetary policy decision to the question of when the repo-rate should be increased.
But there is a second, more striking pattern which emerges when these correlations are grouped by asset class and by country. Correlations are far higher by asset class than by country. In other words, there is greater co-movement among similar asset types across countries than among different asset types within countries. A portfolio-level cut is more revealing about the underlying dynamics of global finance than a country-specific cut. How to make sense of these patterns? One explanation may lie in the behaviour of global asset managers. Financial markets are increasingly driven by their behaviour (IMF (2014)). For asset managers, the key determinants of their portfolio choice may be the risk characteristics of different asset classes, rather than their country characteristics. Certainly, that is consistent with the correlation patterns. Either way, these patterns serve to underline the importance of multilateral and spilloverbased analysis, as distinct from country-specific (Article IV) surveillance, when assessing risks to both global and national financial systems. They also carry potentially important implications for how these dynamics might most effectively be managed from a macroprudential perspective (discussed below). (b)  Improvements to country debt structures (and restructures)  Debt flows are known to be a potent source of instability within the international monetary system. The instabilities they generate are exacerbated by frictions in the design of debt contracts. One such friction is that debt is an inherently pro-cyclical instrument.

Moreover, those countries most at risk from capital flight are not necessarily those with the highest reserves. Scaling countries’ reserves by measures of their external short-term indebtedness suggests a highly-uneven pattern (Chart 16), with a number of countries holding less than would be needed to meet a year’s worth of capital outflows. Third, this pattern is broadly mirrored when moving from measures of self-insurance, such as reserves, to official financing measures. Chart 17 scales IMF resources by external assets. Since the 1980s, this measure has roughly halved from 3% to 1.5%. And fourth, even once we augment multilateral financing with measures of regional official financing, total official resources relative to external assets are still shy of their levels in 1980. Taken in combination, this paints a picture of an international monetary system whose underlying topology has fundamentally changed shape and scale – much larger, much more connected. But it is also a system whose architecture may have failed to keep pace with those changes. Therein lies a key potential fault-line. Strengthening the system This naturally begs the question – what might be done to close this fault-line, to improve the resilience of the international monetary system? One response would be to retreat from financial globalisation by re-imposing barriers to capital movement, unravelling the tightlywoven knitting of the global financial web. We have seen this movie before. It opened in the aftermath of the Great Depression and ended in disaster.
In the case of sovereign CDS, the issue is not necessarily with buyers who ultimately carry limited risks but with sellers. In fact we probably need a specific supervision of credit protection sellers. Regarding credit rating agencies, the agreement on strengthening the regulatory oversight is becoming a reality with the implementation of the agreed European framework, which will give a pivotal role to the European Securities Market Authority. At the same time there is a need to reduce the dependency on credit rating agencies for regulatory purposes, both in prudential regulation and as eligibility criteria for central bank refinancing. ******************************** Let me now conclude briefly. We are still going through very challenging times. The European banking system seemed to have recovered partly thanks to central banks and governments policies supporting the banking sector. This return to profitability should be used to comfort capital positions in those firms, in views of the various risks I have rapidly discussed. Recent renewed strains on financial markets especially sovereign markets and the subsequent impact on the banking sector show us that the crisis is not fully behind us and those central banks actions are more than necessary to accompany the redefinition of the banking sector, the well-functioning of markets and the return to a self-sustainable recovery. So far, the measures taken by the Eurosystem to stabilize markets and restore their functioning, as well as the establishment of the European Financial Stabilization Facility, have lowered tail and contagion risks.

As recently pointed out by the G20 Finance Ministers and central bank governors, recent events have highlighted the importance of sustainable public finances : those countries with serious fiscal challenges need to accelerate the pace of fiscal consolidation;  2)  Secondly, the announcement of a EUR 110 billion financial aid package for Greece, agreed between the European Commission and the IMF conditioned to a package of substantial fiscal consolidation measures by Greece contributed to alleviate concerns in the markets. 3)  Thirdly, to restore confidence in the whole euro area and to contain contagion, a plan with a broader scope has been adopted at the euro area level, the European Financial Stabilization Facility, for a global amount of 750 billion euro with the financial participation of the IMF. One of the key features of this Facility will be the possibility to be used on short notice without involving further national Parliaments. Finally, let me focus on the other recent actions of the European central bank which have been essential in response to these challenging circumstances. Central banks complemented these actions by specific and innovated measures 1)  After careful consideration of all implications of this option and based on its positive assessment of the Greek consolidation package , the Eurosystem decided to suspend the reference to credit rating and current market prices in the collateral requirements for marketable debt instruments issued or guaranteed by the Greek government.
The B40 and vulnerable groups are the ones who will be the most affected if we let inflation get out of hand, and we will not be able to preserve sustainable growth over the longer term. Let us also not forget that keeping rates too low for too long can have damaging effects on the economy. The devastation of the Global Financial Crisis more than a decade ago, which was rooted in the US housing market and caused a synchronised global recession, should continue to serve as a sober reminder of this. Let me briefly now turn to the second thing on everyone's mind when they think about the economy - the ringgit. When it comes to the ringgit, BNM's role is to make sure that its value does not swing too fast or too much either way, and to allow an orderly price discovery. Under a flexible exchange rate, it is reasonable for the ringgit to fluctuate from time to time. These adjustments allow the domestic economy to adjust to global economic and financial shocks. We saw this during the Federal Reserve's rapid and large interest rate adjustments last year, which caused huge shocks to the global economy. At one point, the ringgit declined as much as 11.5% between end-March to early November, before appreciating by 7.8% towards the year end. Yet the real economy grew by 8.7% during the year, thanks in no small part to the ringgit's role as a shock absorber.

With the economy gaining strength, macro policies such as the OPR must be adjusted. This is necessary to ensure that our broad macro policies match our economic realities. At the same time, we recognise that although the overall economy is in good health, there are some who are still facing economic challenges. However, given that the OPR is by design a blunt tool to deliver price stability, more targeted measures are in place to help those who may be facing difficulties in meeting their monthly loan repayments. Help continues to be available through banks or AKPK, which can work out new repayment arrangements tailored to individual circumstances. In this way, policies can work to deliver what the economy needs. By acting sooner rather than later in managing inflation, we have been able to move in a measured and gradual way, avoiding large and more disruptive adjustments which would have been much more costly for the economy. We are still experiencing high and elevated inflation, partly due to strong demand. Yes, some cost pressures are coming down, but it has not translated to the final prices of goods because demand remains high. The cost of making nasi lemak has probably eased but with people still queuing as far as 100 metres for Akak Nasi Lemak, as widely shared on TikTok, prices are unlikely to come down as long as demand stays strong. If we do not manage excessive price pressures like we see in some other economies, this will affect everyone through lower purchasing power.
Thus, even in an economic boom, employers can hold back wage increases without the risk of losing valuable labour. Of course, these changes in wage formation may vary considerably in different economies. But they interact with each other due to the global 2 Read more at: https://www.riksbank.se/sv/finansiell-stabilitet/det-finansiella-systemet/betalningar/  3 The risk of unemployment is one of many factors behind wage expectations. The experience of unpleasant mac-  roeconomic events characterises the behaviour of different age categories, as discussed, for example, by Malmendier and Nagel in “Depression babies: Do macroeconomic experiences affect risk taking?” (The Quarterly Journal of Economics 2011)  3 [5]  market for goods and to a growing part of the service sector also being traded globally. The increase in the number of self-employed people, the many part-time positions and the changed wage composition are factors that tend to crop up as explanations for low wage growth in other economies but which I consider to be less important for understanding wage formation in Sweden. On the other hand, what is special for Sweden is that we have become many more on the labour market. The number of persons between 15 and 74 in the labour force increased by just over half a million between 2006 and 2016. This increase is largely due to high immigration but the labour force is also growing due to changed rules and reforms on the labour market and to tax, benefits and pension rules.

4 A higher labour supply leads to greater competition for vacant jobs, thus restraining the rate of wage increases. My assessment is that there are overarching cyclical forces that suggest wages will rise during the forecast period, but that the rate of increase may remain low despite the high level of resource utilisation. When the effect on the economy from upheavals such as technological advances, demographic changes or increased cross-border trade has worn off, employees should be able to increase their pay again. However, this can take time and, during the transition, the best contribution monetary policy can make is to facilitate, via high resource utilisation and as far as is compatible with the inflation target, the various adjustments demanded by structural transformation and demographics. Education and oversight of competition – to meet the future However, if Sweden as a country is to be able to meet these challenges over the long term, other policy areas than monetary policy will have to be used. Here, I would like to name two important areas: education and oversight of competition. In light of technological developments and population increases, opportunities for life-long education and professional development will be completely decisive. Even well-educated professional groups that have previously had low unemployment have started to become aware of a growing risk of being automated out of work. This applies, for instance, to investment advice, financial accounting and legal support.