samchain/econo-pairs-v1 huggingface dataset:
This is probably the biggest risk to Asia, given the region’s exposure to the corporate investment cycle. 2 / 11  BIS central bankers' speeches  Beyond the tariff war, there is a new and unknown risk on the horizon – the broadening of the trade dispute to the technology front. With global value chains, production is distributed and technology dispersed over several countries, industries, and products. Moves to restrict the supply of critical technologies could potentially lead to significant disruptions in these value chains. Some of these technologies are deeply embedded across multiple products and there may be mutual dependencies across these products. We do not fully understand the dynamics of these value chains and technology dependencies. But it is not difficult to imagine how restrictions on the use of key technologies – like advanced semiconductors – can potentially disrupt activities ranging from data centres to communications between network devices. The disruptions to supply chains and economic activity could potentially be even larger than from tariffs. A prolonged technology conflict could lead to a bifurcation of technology infrastructures globally. While downside risks have clearly increased, we should not over-react. The engines of manufacturing, trade, and investment have stalled, but the global economy is not headed for a crash. Two other engines are providing support: easier monetary policies in the major economies; and resilience in services and consumption. Monetary policy in the US has turned more accommodative against the backdrop of benign inflation.

The government’s aim is not to depress property prices but to promote a stable and 6 / 11  BIS central bankers' speeches  sustainable market. The government does not have a target rate of increase for property prices nor can it manage the cycle too tightly. But the government does have a role to help ensure that price movements are broadly consistent with economic fundamentals. In an economy that is growing in nominal terms at 3-5%, it is not sustainable to have property prices increasing at double-digits. The government will continue to monitor the property market closely and stands ready to help ensure a healthy and sustainable market. MAS’ FINANCIAL OPERATIONS Let me now move on to MAS’ financial operations. I will start with: how MAS has been accumulating Official Foreign Reserves (OFR); and why MAS decided to transfer part of its OFR to the Government; before touching on MAS’ financial performance and return of profit to Government. MAS has been steadily accumulating OFR, especially since the Global Financial Crisis. Most of the period since the Global Financial Crisis was characterised by extremely loose monetary policies in the advanced economies, with interest rates near zero and massive expansion of central banks’ balance sheets. This led to a surfeit of liquidity in the global financial system and large capital flows to many emerging market economies. As an economy with very sound fundamentals, Singapore naturally attracted quite a large portion of these capital flows, which exerted sustained and large appreciating pressures on our exchange rate.
In short, we were far from the model of ‘atomistic competition’ among small individual actors envisaged by thinkers such as Adam Smith. The invisible hand of the market had been replaced by a very visible club being wielded by a concentrated group of speculators. 21. In many other jurisdictions, this cornering of the markets would have been subject to investigation under anti-trust legislation: the Salomon Brothers scandal in the US in the early 1990s, which many of you will recall, is a parallel that springs to mind. In Hong Kong we have no such laws: it is probably time that we thought out the cases for and against having them. We should also look at safeguards against market concentration. As things stood in August last year, we were watching (in a loosely worked metaphor that might appeal to those of you who will be attending the Rugby Sevens this weekend) a playing field that had become so badly slanted that ordinary players could barely stand up, and a game that was about to be cornered by a highly oversized and unsportsmanlike team with steroid-enhanced muscles playing by its own rules. As a referee with limited powers, but with responsibility for preserving the basic integrity of the game, we intervened using the quickest, most efficient and fairest methods that we had at our disposal.

On the macroeconomic side, the news for the United States is mostly favorable. Labor market conditions have significantly improved over the past few years and unemployment is now around 5 percent. The household sector is much less leveraged, the housing sector is recovering, the banking system is much healthier, and the corporate sector is highly profitable, even as business fixed investment spending remains quite weak. Although inflation has fallen short of our objective, I am confident that inflation will return to our 2 percent objective over the next few years as the labor market tightens further and the transitory factors that have held inflation down dissipate. After years at the effective lower  BIS central bankers’ speeches  1  bound for short-term interest rates, economic conditions have finally warranted the start of U.S. monetary policy normalization. But these monetary policy adjustments are likely to be gradual and cautious, as we continue to face significant uncertainties and the headwinds to growth from the financial crisis have not fully abated. For Europe, the economic outlook has started to improve. The European Union is experiencing a cyclical recovery and the unemployment rate has been steadily declining over the past two years. The end of fiscal tightening appears to be a key factor in this recovery. Risks of low inflation, however, remain a concern for the European Central Bank and have motivated their aggressive use of unconventional monetary policy instruments.
The research carried out over the past twenty years has taught us, for instance, that it is not only the right economic policy measures to achieve growth that we need; institution building is at least as important, and this must be adapted to local conditions and help countries to tackle new challenges. These are important lessons to take into the future with us. What we can say with certainty is that the path entered upon, towards greater liberalisation and market economy and the promotion of technological advances, has shown good results. Many millions of people have attained a much better standard of living over the past sixty years, both in material terms and in terms of quality of life. At the same time, all of the available data clearly indicates that the countries which have had least success are those that are least integrated into the world economy, that have not managed to create a stable macroeconomic framework, have poor protection for property, complicated and inefficient bureaucracy, a high degree of corruption and a widespread informal sector into which a large part of businesses have been forced. There thus appears to be a great deal that developing countries can do themselves to improve their situations and create the right conditions for stable growth. However, the wealthier countries also need to do their share, for instance by opening up currently protected sectors of their economies to free trade. Moreover, the multilateral institutions play an important role.

If they are not, the model will break-down out of sample, as did the (deductive) DSGE model and the (inductive) Google flu model. A gaming environment could be used to understand behaviour in a way which placed fewer restrictions. People’s behaviour would be observed directly in the act of game-playing which, provided this behaviour was a reasonable reflection of true behaviour, would give us new data. Because this is a virtual rather than real world, with shocks controlled and regulated, that could make it easier to address issues of causality and identification in response to shocks, including policy shocks. There are already multi-person games with primitive economies attached to them, which allow goods and monies to change hands between participants. These include EVE Online and World of Warcraft. Some economists have begun to use gaming technologies to understand behaviour. 52  For example, Steven Levitt 53  (of Freakonomics fame) has used gaming platforms to understand the demand curve for virtual goods. The idea here would be to use a multi-person dynamic game to explore behaviour in a virtual economy. This would include player interactions – for example, the emergence of popular narratives which shape spending or saving. And it could include player reactions to policy intervention – for example, their responses to monetary and regulatory policies. Indeed, in the latter role, the game could serve as a test-bed 54  for policy action – a large-scale, dynamic, digital focus group.
12  4  Kung, 2015, discusses the equilibrium implications of such “shared appreciation mortgages”: http://www.newyorkfed.org/research/conference/2015/mortgage_design/Kung_Edward_housingstructural_052 015.pdf. BIS central bankers’ speeches  BIS central bankers’ speeches  5

New hedging products which are scarce in the market need to be developed in the quest to seek for compatible risk mitigating products. In accordance with the principles Islamic the Shariah has allowed the Ummah to undertake juristic reasoning based on contemporary analysis and logical inference. Indeed, the development of new hedging products is something that the Islamic financial community can look forward to. In conventional banking, these instruments are used to mitigate risk. Indeed the Islamic financial community will soon develop such products for this purpose. 4  BIS Review 3/2004  Fifth, effective and dynamic Shariah framework One of the central issues towards developing a dynamic Islamic financial industry is the Shariah. The Shariah should always be viewed as an enabler to innovation and creativity, rather than a constraint. Efforts, therefore, need to be enhanced to fully appreciate and maximise the true potential and wisdom of the Shariah. The collaboration among the Shariah scholars, practitioners, researchers and regulators to undertake in-depth studies and research to create new products will provide the fundamental foundation towards the development of a dynamic Islamic financial system. Sixth, development of comprehensive legal infrastructure Another important pre-condition to sustain the continued growth of Islamic banking and finance is a comprehensive legal infrastructure for legal redress arising from Islamic financial transactions. The legal infrastructure needs to comprise both effective regulatory and substantive laws as weIl as appropriate adjudicative fora for parties to resolve disputes relating to Islamic financial transactions.
As I mentioned earlier, the problems in the US subprime market had widespread and profound effects on the international financial markets. These loans had been packaged together with other securities into structured products and sold to investors around the world. The uncertainty over where the potential losses were created a general distrust between the banks and a general increase in risk aversion. The former was expressed in a rise in the differences between interbank rates and risk-free government bonds, what are known as TED spreads. The latter was expressed in, for instance, rising credit spreads (see figures 7 and 8). For a few weeks now we have seen signs that the tensions in the credit market have eased. The credit spreads have declined and the cost of insuring against losses has fallen (see figure 9). Other signs are that the banks have been able to sell off loans from their balance sheets. They have also been able to strengthen their own capital, although a large part of this process still remains. The stock markets have also recovered. The uncertainty in the interbank market has prevailed longer; the TED spreads have remained high but have fallen over the past few days. In Sweden the TED spreads have also risen, but unlike other countries the markets have continued to function without any intervention from the Riksbank. Despite the fact that there are positive signs, it is still too early to assume the danger is past.

I want to build on that track record to do the same for our new tasks because in everything the Bank does, I and my colleagues are conscious that we are accountable to you. The Bank of England has changed radically since that Bank Holiday Monday in 1997 when Eddie George and I sat in the Bank contemplating our new role, unaware of the roller coaster ride on which we were about to embark. The Bank will change again next year with its new responsibilities. But some things don’t change. Here again is Mr. Montagu Norman: AUDIO INSERT: “I would sum up the vital characteristics of the Bank as experience in affairs, cooperation on all sides, independence of judgement. But you know these three things – experience, cooperation, independence – are no good unless people have confidence in you. I like to believe that the Bank, with its long history and tradition, stands high in public esteem. But only by service to the community can that esteem be maintained through times good and bad.” That’s true not just for Montagu Norman’s day, but for today too. The present crisis is far from over, as events in the euro area illustrate weekly. Our own economy is still not back to health. Although inflation has fallen back in recent months, it is still too high. And despite efforts to stimulate the economy, the recovery is proving slower than we had hoped. It will come.
The data on the Bank’s historic last resort lending is new and highly granular, Big Data from a bygone era. th  It shows that the Bank’s approach to last-resort lending evolved considerably during the mid-19 century crises. That meant, by the time of the 1866 crisis, the Bank was more or less following the principles for last-resort lending subsequently set out by Bagehot. It is another example of empirics leading theory. Machine learning techniques are being applied to the statistics regularly collected and reported by the Bank. In particular, these techniques are being used to spot errors or anomalies in the raw data provided to the Bank. This makes cleaning the data much more systematic and efficient than is possible using manual processes. Data science methods can also be used to match new sources of granular data. This not only provides another means of checking the plausibility of data, but can offer insights that individual data sources 48  cannot reveal by themselves. At the Bank of England, as elsewhere, the robots are on the rise. 46  Bagehot (1873). Anson et al (2017). 48 Bahaj, Foulis and Pinter (2017), for example, match firm-level accounting data, transaction-level house price data and loan-level residential mortgage data to show how the house price of the director of an SME can affect their firm’s investment and wage bill.

This workshop will provide an opportunity for all GCC organizations in the statistical community to share national experiences, and lead discussions to identify areas for mutual cooperation for further improvement in data production and presentation. I may emphasize here that timely availability of reliable and mutually consistent national data would be of great help to the GCC Monetary Council in its task of preparing for the achievement of the ultimate goal of GCC Monetary Union. It will also provide the basis for judicious policy formulations even after the establishment of the Monetary Union for the region. I therefore urge you all, to actively engage in workshop discussions to fully understand these matters, come to useful conclusions and make your deliberations fruitful. Dear Participants I hope that by the end of the workshop you will have achieved at least the following two objectives: 1. Sufficient statistical insight to effectively address burgeoning data-related issues and concerns, and be in a position to produce intended statistical forms and table, and;  2. Identification of some future work based on mutual cooperation. I thank you all for your attention and wish all a productive and rewarding workshop. 2  BIS Review 170/2010
As set out in the Statement of Policy, the indicative thresholds are 40,000 to 80,000 transactional accounts for partial transfer strategies, and a balance sheet size of £ to £ for bail-in strategies. 15 Details of the December 2020 update are here: Bank of England’s statement on MREL and Resolvability deadlines 16 Please see our Discussion paper for more detail: The Bank of England’s review of its approach to setting a minimum requirement for own funds and eligible liabilities (MREL) 13 14  6  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  6  am not alone in recognising the feat of coordination which is required to deliver resolutions on a cross-border basis. The UK is a strong supporter of enhancing these mechanisms for engagement with other authorities – as both home and host authority. This interest is underpinned by a suite of cooperation agreements with our international counterparties and regular engagement with other jurisdictions to support cross-border resolution planning and policy development. This has included a series of exercises involving senior officials from a number of jurisdictions, including the United States and the euro area. Here we aim to have a shared understanding of the actions and decisions on the path to resolution for our firms, and agree ways to test our coordination mechanisms and our virtual communication capabilities.

This in turn will help boost customers’ confidence and trust in their bankers, which in my view would be tremendously important to the sustainable development and credibility of our banking industry. 2  BIS central bankers’ speeches  What do we expect a bank to do in consumer protection? Just exactly what do we expect a bank to do in consumer protection? Under the guiding principle of “treating customers fairly”, we expect banks to do three things when they market banking or investment products: •  banks should set out and explain clearly the key features and risks of the products concerned, including any applicable fees, commissions or charges;  •  banks should conduct an assessment of the financial capability, investment experience and risk appetite of their customers. This is an important tool that enables the banks to have a more objective view of the risk tolerance level of the customers;  •  banks should assess the needs of their customers, and the suitability of a financial product for their customers. If a bank considers that a product is not suitable for a customer, it should not solicit or recommend the customer to purchase the product. I would like to point out that Hong Kong adopts a disclosure-based investor protection regime, which means that an intermediary is obliged to disclose and explain to the customers the key features and risks of an investment product.
In assessing the exchange rate it is important to point out that in real terms the exchange rate is not much higher at present than its average over the past ten years. Thus there is no possible way to claim that the current exchange rate is blatantly out of step with what is appropriate for the economy or is far from the real equilibrium exchange rate. It has also been claimed that there is a significant risk of deflation in Iceland. The Central Bank considers the likelihood of this to be negligible. In fact, the talk of deflation can largely be expected to reflect international discussion of the same issue, with claims from various quarters that there is a risk of deflation in Germany and the USA in the same way that has happened in Japan. Nothing suggests that deflation is looming in Iceland – wage costs have risen, growth in money supply is robust, inflation expectations in the market are around 2% or above, and one of the largest construction programmes in Icelandic history is on the horizon. It may be added that, up until now, Iceland has never had any problems in kindling inflation. In light of all the above, the Central Bank does not believe that there are grounds for a large cut in interest rates in order to bring down the exchange rate of the króna or dispel the risk of deflation, which is virtually nil anyway. Such action would probably pave the way for subsequent overheating of the economy and inflation.

For example, the Bank is now obliged to present public explanations every quarter of its monetary policy and monetary, exchange rate and currency developments, and its measures in these areas. As I said earlier, the main objective of Central Bank monetary policy is to keep inflation as close as possible to 2½%. The Central Bank has only a single instrument for achieving this objective: interest rates. The crucial interest rate here is that used in the Central Bank’s repurchase transactions with credit institutions, sometimes called the policy interest rate. Such transactions effectively represent the Bank’s liquidity facility for these institutions. The commercial and savings banks then decide their own rates of interest with reference to the Central Bank’s policy rate and short-term interest rates invariably alter in pace with the Central Bank rate. Other things being equal, changes in the Central Bank interest rate also affect long-term interest rates, but other factors have an impact as well. Their responses to the Central Bank’s interest rate changes are therefore not always foreseeable and tend to take place with some lag. Inflation forecasting plays a crucial role in the Central Bank’s current activities. It produces four forecasts a year and publishes them in its quarterly Monetary Bulletin. The inflation forecast is projected just over two years into the future, on a quarter-by-quarter basis. As in other countries, Central Bank interest rate changes take a long while to have an impact on the economy. The inflation forecast therefore needs to be forward-looking and based on the best available methodologies.