samchain/econo-pairs-v1 huggingface dataset:
I consider that both the ongoing review of monetary policy strategy and the strategy to address the challenges arising from the growing digitalisation of the financial system are two sound exponents of this way of working. They will allow us to continue adding the maximum value to the European economy and, by extension, to Spanish society. Thank you. 14  References Aguilar, P., Ó. Arce, S. Hurtado, J. Martínez-Martín, G. Nuño, and C. Thomas (2020). “The ECB monetary policy response to the COVID-19 crisis”, Occasional Papers, No 2026, Banco de España. Arce, Ó., M. García-Posada, S. Mayordomo and S. Ongena (2018). “Adapting lending policies in a “negative-for-long” scenario”, Working Papers, No 1832, Banco de España. Arce, Ó., R. Gimeno and S. Mayordomo (2017). “Making room for the needy: the creditreallocation effects of the ECB’s corporate QE”, Working Papers, No 1743, Banco de España, forthcoming in Review of Finance. Arce, Ó., I. Kataryniuk, P. Marín and J. J. Pérez (2020). “Thoughts on the design of a European Recovery Fund”, Occasional Papers, No 2014, Banco de España. Bernanke, B.S., M.T. Kiley and J.M. Roberts (2019). “Monetary Policy Strategies for a LowRate Environment”, AEA Papers and Proceedings, No 109, pp. 421-426. Brunnermeier, M. K., and Y. Koby (2018). “The Reversal Interest Rate”, NBER Working Paper Series, No 25406. Fiorentini, G., A. Galesi, G. Pérez-Quirós and E. Sentana (2018). “The rise and fall of the natural interest rate”, Working Papers, No 1822, Banco de España. Galesi, A., G. Nuño and C. Thomas (2017).

The Global  Financial Crisis led to a loss of economic activity equivalent to around £ per person in the UK, based on the net present value of the shortfall in income since 2007 compared to its pre-2007 trend(Brazier 2019). 2 For  example, Acemoglu and Zilibotti (1997), Arestis and Demetriades (1997), and Beck and Levine (2004) provide evidence that the financial sector has a positive role on economic growth. 3 The ‘efficient market hypothesis’ was popularised by Fama (1970). Complete markets were theorised by Arrow  and Debreu (1954). 4 For example, markets could be inefficient due to information asymmetries, transaction costs, market  psychology, sticky prices, monopolistic competition, or credit constraints. 5 Drehmann et al. (2012) and Lang et al. (2020) highlight the importance of cyclical risk for financial stability. 6 Glasserman and Young (2015) and Acemoglu et al. (2015) discuss the risk of contagion in the financial system. 7 Woods (2022) discusses alternative approaches to buffer usability. 8 6/7  BIS central bankers' speeches  8 See Bank of England (2021). 9 See Chatterjee (2022) for a comparison of the UK financial conditions index for the GFC and Covid. 10 Lloyd et al. (2021) shows that foreign shocks are a key driver of domestic macroeconomic tail risks. Bluwstein et  al. (2020) also show that global factors can predict financial crises. 11 See Czech et al. (2021). 12 Bank of England (2021) provides more details on vulnerabilities associated with market-based finance and  liquidity mismatch in open-ended funds, in particular.
The swap lines are not at present a permanent and a reliable feature of the international monetary system; for instance, they have been strongly challenged in political discussion in the US. Furthermore, there are important unresolved governance issues, such as who should decide which countries get a swap line and which do not. It is thus an important item on the reform agenda to clarify the extent to which standing foreign currency LOLR facilities for solvent cross-border banks can be set up. In the meantime, cross-border banking will retreat because of this risk, and smaller countries in particular will be more reluctant to provide a home base for cross-border banks. BIS central bankers’ speeches  1  Let me now move to the EU/EEA level. Here the main fault line is the contradiction between, on the one hand, the area-wide permission to operate based on home licensing and a common regulatory framework (the European passport) and, on the other hand, national supervision, a national safety net of deposit insurance and LOLR, and national crisis management and resolution regimes. The underlying principle is the same as in many other areas of the EU: an equal and harmonious competitive position throughout the area. In that ideal world, the location of headquarters and the size of a banking system relative to that of a country should not matter. The crisis revealed that this framework is deeply flawed. First, it ignores the FX liquidity risk that I discussed earlier.

Ravi Menon: The future of money, finance and the internet Speech by Mr Ravi Menon, Managing Director of the Monetary Authority of Singapore, at the Singapore FinTech Festival, 9 November 2021. * * * Good morning everyone. If you’ve just joined us, welcome to Day Two of the Singapore FinTech Festival. I want to talk about the future of Money, Finance, and the Internet. But first, a little history. JUNO, PLUTUS, MERCURY Money as a medium of exchange and store of value has been around for millennia. It is named after the Roman goddess of money, Juno, who carried the title Moneta. Rome’s currency was first minted at her temple in the third century B.C. Money has come a long way since: from bullion coins, to paper notes backed by the gold standard, to fiat currency backed by central banks, and now digital money. Finance or the intermediation of savings and investments existed in many ancient civilisations. The Roman god of wealth, Plutus, comes closest to being the presiding deity for finance. Finance too has come a long way: foreign exchange markets and bills of exchange emerged in the Middle Ages, before modern finance took shape with fractional reserve banking, stock markets, mutual funds, and insurance. The Internet is more recent. Its official birthday is 1 January 1983, though the concept itself – namely a computer network which enables information sharing among users – goes back to the US defence industry in the 1960s.
Each of these intangible assets has value, but this value can be lost in a heartbeat. While it is true that a tangible asset such as a factory can burn to the ground overnight, intangibles, unlike a factory, usually cannot be insured. A challenge to current accounting - and disclosure - rules, therefore, is how to reflect accurately not only the value of intangible assets, but also their vulnerabilities to sharp downward revaluations. BIS Review 57/2002  5  In terms of complex financial transactions, this past year's events have made clear that accounting and disclosure rules have failed to keep pace with financial innovation. Complex financial arrangements, such as those funded offshore or through special-purpose entities, are not effectively addressed in today's accounting and disclosure rules. We also saw telecom equipment manufacturers run up billions of dollars’ worth of customer guarantees, which under current accounting and disclosure guidelines did not have to be recognized in financial accounts or disclosed to investors until their customers defaulted or were near default. In these cases, it seems clear, one of the basic tenets of accounting and disclosure rules - that there should be no “hidden” liabilities - seems to have been violated. I would like to see much more done to address these deficiencies without unduly burdening the readers of accounting statements. 4. Disclosure  Disclosure is most useful as a complement to accounting statements.

But we can, and do, aim to offset the impact of persistent external influences on the prospect for inflation so that inflation in the economy as a whole stays on track to meet the inflation target given to us by the Chancellor. That is what we have been doing – and is the context of our further move today. No-one, my Lord Mayor, is more conscious than I am of the limits to what we can hope to achieve through monetary policy. But by operating within those limits we have been able to achieve greater macro-economic stability, and consistently lower inflation, than we’ve seen for a generation. And that stability, together with the improved supply-side flexibility of the economy, has delivered our highest ever level of employment, and a rate of unemployment in the economy as a whole that is still close to its lowest for almost 20 years. 3  BIS Review 68/1999
Central bank money has traditionally only been made available to the general public in physical form – in other words, cash. The aim of retail CBDCs is to create a digital form of central bank money that can be used by everyone. In contrast, central bank money already exists in digital form for wholesale purposes. Wholesale CBDC projects are about making digital interbank transactions, such as securities settlement and cross-currency payments, safer and more efficient. This in turn means that different actors are involved in retail and wholesale CBDC projects. Retail CBDC projects involve a wide range of stakeholders: legislators, the retail payments ecosystem and the broader public. This is because retail CBDC is new. How it is designed and distributed needs to be considered very carefully to ensure that it responds to public policy objectives and does not have unintended effects on financial intermediation. Work on wholesale CBDC, meanwhile, involves a narrower set of stakeholders that already use digital central bank settlement infrastructures today, such as banks or central securities depositories. And in the future, new stakeholders could potentially take part in the wholesale settlement chain using new technologies such as DLT. So when central banks talk about wholesale CBDCs, we are not debating whether to introduce them. We are discussing how to improve and modernise services that we already offer today. Modernising wholesale CBDC I would therefore like to focus on our continuous efforts to improve wholesale payment systems.

We want to ensure that central bank money remains available for the public to use everywhere in the euro area for their day-to-day transactions – not just in its physical form, but in digital form too. But we are also actively working to modernise the payment infrastructure underpinning our financial system. Technologies and preferences are changing, and preserving the role of central bank money as a safe asset at the heart of the system remains key. It strengthens the confidence in the smooth functioning of the financial system. The discussion on the wholesale version of central bank digital currencies – wholesale CBDC for short – is often prone to confusion, however. Wholesale CBDC is generally presented as something new, made possible by the emergence of distributed ledger technology (DLT). [1] But wholesale CBDC has existed for decades. And it has provided efficient digital infrastructures for the settlement of transactions between banks in central bank money. The discussion about wholesale CBDC should therefore focus on how existing infrastructures have to be adapted as technologies and needs evolve. Today I would like to demystify this concept of wholesale CBDC. I will first clarify what wholesale CBDC is and what it is not. I will discuss the emerging need to adapt the wholesale infrastructure to evolving user demands. And then I will outline some of the technological choices that lie ahead. Defining wholesale CBDC Let me start by clarifying some frequent misunderstandings about wholesale CBDC. First, there is confusion surrounding the term “wholesale”.
Mr. Heikensten looks at the prospects for the Swedish economy against the background of the central bank’s monetary policy Speech by the Deputy Governor of the Bank of Sweden, Mr. Lars Heikensten, given at the Centre Party’s Economic Seminar in Haparanda on 15/6/97. I should like to begin with a word of thanks for the invitation to talk to you here. In these introductory remarks I shall be discussing the economic situation. Sweden’s economy presents many positive aspects: the outlook for growth is good, the general government deficit is estimated to be eliminated next year and the low inflation policy is becoming more and more established. But there are also persistent economic problems to solve, not least in the labour market. Before considering the economic situation, however, I thought I would say something about monetary policy, the role of the Riksbank and the changes in the status of the Riksbank that recently gained the support of five of the political parties in Sweden’s parliament, including the Centre Party. 1. Monetary policy and the role of the Riksbank Why low inflation? In the past decade there has been a growing awareness of low inflation’s importance as a central condition for the proper workings of an economy. This has been the case not just in Sweden but virtually throughout the western world. The significance of price stability is clearly demonstrated by Sweden’s experience in earlier decades.

When inflation fell back in the early 1990s it became apparent that the investments in real estate had been founded on unrealistic expectations that prices would continue to rise. The property market collapsed and credit institutions were hit by massive loan losses. The bank crisis accordingly accentuated the economic downturn in Sweden. BIS Review 68/1997  -2-  Inflation is also associated with an arbitrary redistribution of income and wealth, often contrary to the ambitions of distribution policy. Referring again to the 1980s, the chief losers from the inflationary economy at that time, with the resultant price fall, were probably not the property speculators but households whose bank savings were eroded by two-digit inflation and whose wages were only subsequently adjusted for inflation. Price stability is the Riksbank’s objective The reason why monetary policy is assigned the task of safeguarding the value of money is basically simple: by adopting an appropriate monetary stance the central bank can choose, or at least strongly influence, the rate of inflation. In the short run price increases are of course affected by many other factors such as the state of economic activity, the direction of fiscal policy, wage formation, etc. But in the long run inflation is a monetary phenomenon. By controlling the supply of money in a wide sense, in the long term the Riksbank can also govern movements in the value of money and in inflation. Interest rate management by the Riksbank cannot, on the other hand, generate economic growth and employment in the longer run.
The share of oil and gas resources still in the ground has decreased considerably. This means we can tolerate slightly higher volatility in our financial wealth. The GPFG is managed on behalf of the Norwegian people. Good governance, control and transparency with regard to the management of the fund are important democratic principles. A broad set of reports on the GPFG’s performance and operations are published on a regular basis. Through 2016, Norges Bank worked on preparing its strategy for 2017–2019, including the strategy for the management of the Government Pension Fund Global. The strategic plan builds on the main elements of the plan for the previous period. We will continue to place emphasis on our role as a long-term, professional owner with in-depth knowledge about the largest companies and to actively contribute to the development of international standards and principles. As from 2017, the level and composition of the GPFG’s real estate investments will be decided by Norges Bank’s Executive Board. Norges Bank is committed to performing its investment management assignment in a costefficient manner, taking advantage of the fund’s unique characteristics. The goal is to achieve the highest possible return within the framework of the investment management mandate. 1 Return before management costs and measured in terms of the fund’s currency basket. 2/2  BIS central bankers' speeches

Slow recovery Quarterly changes in per cent calculated as annual rate, seasonallyadjusted data 6  6  4  4  2  2  0  0  -2  -2  -4  -4  -6 -8  -6 Euro area  -8  USA  -10  -10 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 2004  2005  2006  2007  2008  2009  2010  2011  2012  Note. Broken columns represent the Riksbank’ s forecasts in July 2009. Sources: Bureau of Economic Analysis, Eurostat and the Riksbank  BIS Review 98/2009  9  5. The oil price, Brent crude USD per barrel 140  140  120  120  100  100  80  80  60  60  40  40  20  20  Outcome Forward rates, average up to and including 25 June 2009  0  0 00  01  02  03  04  05  Note. Broken lines represent the Riksbank’s forecasts. 06  07  08  09  10  11  12  Sources: Intercontinental Exchange and the Riksbank  6.
Zeti Akhtar Aziz: Towards creating an Islamic Financial System as an integral part of the International Financial System - strategies and challenges Speech by Dr Zeti Akhtar Aziz, Governor of the Central Bank of Malaysia, at the Asian Islamic Banking & Finance Summit, Kuala Lumpur, 21 September 2004. *  *  *  “The integration of Islamic finance with international financial markets and institutions has demonstrated its viability, competitiveness, resilience and sustainability as a form of financial intermediation. This trend has contributed towards facilitating greater cross border flows in terms of increased trade and investment transactions thereby strengthening the global economic and financial linkages. As this international integration process intensifies, it not only raises the prospects for more balanced global growth but also allows for greater diversification of risks thus contributing towards greater global stability. At the core of this financial globalisation process is the robustness and resilience of the domestic Islamic financial system. The development of a sustainable Islamic financial system that is able to withstand the challenges of the uncertainties and instabilities inherent in the global financial system, thus not only requires an effective global financial architecture but a system that is also supported by an appropriate, comprehensive and sound domestic financial infrastructure. These mutually reinforcing structures would not only accentuate wealth creation and foster greater potential for trade but would also promote global financial stability and breakthroughs in new business relationships”.

And that counts, both when it comes to organising the debate between nine experts, and when it comes to explaining the basis of policy to a non expert public. But forecasts are highly fallible, so our forecast centred approach to inflation targeting has gone hand in hand with a determined effort to illustrate the wide range of uncertainties around any central projection and a systematic attempt to factor the Committee’s own judgements about the risks into decision taking. That, for me, is a key reason for resisting recent calls by the IMF and others for the Bank to ‘publish numerical projections for a broader range of key variables’. Detail is seductive – but it can also be highly misleading, and a committee that spent its time debating the details of the forecast rather than using it as a tool to address big picture issues would be at risk of losing its way. Forecasts are indispensable – but they should be handled with care. 10  BIS Review 17/2005  Table 2. Interest rate surprises  A. Are rates changes evenly spread over the months of the year? Rate changes IR months non-IR months Whole period 1997-2000 2001-present  15 6 9  14 10 4  B. Are rates changes expected to be spread evenly over the months of the year?
Back in 500 BC Sun Tzu, Chinese general and author of a book on the art of war, observed: “Where the army is, prices are high; when prices rise the wealth of the people is exhausted.”1 What this refers to is, of course, that an army of perhaps tens of thousands of soldiers requires a lot of resources just to stay alive and these can be difficult to raise in a geographically restricted area. Demand simply rises in relation to the available supply of food and other necessities, and this causes inflation to rise. If, as has often been the case throughout history, the army supports itself by looting, it may be able to survive for a while, but for the civilian population, prices will rise because supply decreases. Of course, an army could not survive indefinitely in one place, because resources sooner or later run out. In his book “Ofredsår” (“Years of Trouble”), Peter Englund has likened the Swedish army during the Thirty Years’ War to a shark that must be constantly on the move to avoid succumbing.2 Once a war had started, the armies of the time lived partly their own lives, separated from the state, and largely organised their own supplies, especially of course during campaigns abroad. Inflation therefore increased more locally depending on where the armies happened to be, as a result of the demand for food and other necessities exceeding supply.

Rising demand and printing money When a country rearms and fights a war, inflation can also rise in the whole economy for the same reason, that is, demand rises in relation to supply. A sharp increase in public expenditure as a result of rearmament or war effort increases capacity utilisation in the economy and can therefore lead to higher inflation. In connection with the Second World War, the US economy approached full capacity utilisation, which contributed to a rise in inflation. Some economists argue that it was the US rearmament in connection with the war that finally put an end to the 1930s depression.3 The way in which a rearmament or war is financed is also of great importance to the way in which inflation develops. The financing can entail increasing taxes or decreasing expenditures other than military, by raising loans or by making the central bank print more money. If a war is financed by increasing taxes or decreasing other expenditure, public purchasing power will be reduced. This counteracts  1 Goldstein (2003). 2 Englund (1993). 3  See, for example, Vernon (1994). However, others, such as DeLong and Summers (1988), instead argue that the recovery was essentially completed even before the war. 2 [14]  the inflationary effect of increased public expenditure.