samchain/econo-pairs-v1 huggingface dataset:
On top of this, there were of course the market excitement, or interestingly the lack of it, surrounding the reversion of sovereignty; the inevitable bursting of the housing bubble that did not, I repeat not, lead to a collapse of the financial system; the construction of our multi-currency and multi-dimensional financial infrastructure that made RTGS DVP and PVP possible for anybody wanting to manage risks more properly here in this time zone; and the emergence, more recently, of the RMB offshore market here that is also serving as a laboratory for testing financial liberalisation on the Mainland, a development that is of increasing importance to global finance. But it is still a great pleasure, after all these years, to welcome SIBOS back to Hong Kong. I understand that the objectives of SIBOS this year are “learning lessons from the past, exploring the post-crisis landscape and paving the way for future innovation”. These are indeed important objectives, having regard to the current state of global finance. Indeed, for the past couple of years they have been occupying much of the time of the financial authorities and the industry.

I am sure it is not true but it conveys a misconceived perception that perhaps we should not ignore. I am not suggesting that the socialist-market economy model, practiced for example on the Mainland of China, with considerably greater influence over and ownership of the financial system by the authorities, and therefore greater attention by operators within the financial system to the public interest, has become the superior model, although I noticed at least some involuntary movement lately of the so-called Anglo-Saxon model towards that direction. “Thou shalt lend”, says the government to banks that have received capital injections from the public purse. It is I think a matter of degree, not so much in the ownership of the financial system, but more in the legal and institutional framework whereby those with the responsibility to protect the public interest can exert the appropriate influence at the appropriate time, whether it is through prudential supervision, conduct regulation, the provision of safety nets or the design of crisis resolution mechanisms. My second issue is a dilemma. This is a dilemma mostly for emerging markets – a dilemma between pursuing financial openness and maintaining financial stability. I support financial openness as a means of greatly extending the universe within which the risk appetite of domestic savings and the risk profile of domestic borrowers can be satisfied. Indeed, for borrowers and investors of a particular jurisdiction, taking financial intermediation into the international dimension should lower borrowing costs and increase investment returns.
I could provide you with numerous other examples of items being scrutinised by the beady-eyed horizon-scanners within the PRA and wider Bank. Sometimes these occur beyond our shores and we don’t have a direct interest, for instance if large banks in other jurisdictions were found to be to window-dressing by hauling in exposures very briefly in order to secure a lower rating for GSIB capital charges which are set 2  See Supervisory Statement: https://www.bankofengland.co.uk/prudential-regulation/publication/2013/credit-risk-mitigation-ss 5  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  5  on an end-of-period basis. Or I could point to the number of risk-transfer trades within banking that our teams have to reject because they are pushing the boundaries of what is prudent. But I prefer to leave you with one of my own favourites, which our team has christened “missing leverage”. I have long held the view that the capital regime which existed in the UK before the financial crisis was a dangerous one because it did not include a leverage requirement. In other words, the only metric we used was based on risk-weighted capital requirements, which: first, can be subject to incentive and analytical weaknesses where modelled and political weaknesses where set by legislators; second, unless perfectly calibrated by regulators can incentivise the wrong behaviour by firms, such as writing deep out-of-the-money options; and third, can allow banks to become very highly leveraged which is risky even if their asset quality is high.

In this sense, just as the leveraged lending issue is akin to the UK mortgage risking-up issue, these margin loans have an echo of the problems we’ve been tackling on capitalisation of equity-release mortgages – complexity creates a weakness in the system. Another area our scanners are always interested in is the border zone between different industries – and in our case, in particular the border zone between banking and insurance, given we oversee both of these industries. There are a number of cross-border activities which we are keeping an eye on. One is the use of credit insurance to optimise capital positions of banks. This is a perfectly legitimate business and not one that we object to on either side of the border. But we do of course need to be satisfied that a risk which disappears from a bank’s capital requirement has genuinely been moved across the border 2, and that the receiving insurer is properly reserving and capitalising for that liability. Another area of interest is where insurers are taking on illiquid or structural risks from banks, for instance assuming the risk on long-dated inflation swaps. It is natural that some of these risks should gravitate towards the parts of the financial system which can bear them more efficiently. But we need to be sure that this isn’t just because regulation on one side of the border is missing something which has been captured on the other.
Qualitative survey balances can be adjusted to match the mean and variance of an estimated productivity gap from which inference about productivity may be drawn. See Charts 3.7 and 3.8 in the August 2011 Inflation Report. 9  Potential productivity is constructed using the BCC surveys of capacity utilisation and productivity data from the ONS for the manufacturing sector and private services excluding finance sector. The BCC survey asks firms whether they are operating at or below full capacity. Since the survey measures are qualitative, they have been mean and variance adjusted over the period 1989 to 2006 to infer a measure of the gap between actual and potential productivity. The trends shown in charts 5 and 6 are chosen such that the shortfall between actual and potential productivity maps closely to the mean-and-variance-adjusted survey measures of spare capacity. 10  The annual flow of business investment prior to the recession averaged around 7% of the UK capital stock. A 20% reduction in business investment for 5 years would result in the capital stock being only around 2% lower (assuming plausible assumptions for the rate of depreciation). 4  BIS central bankers’ speeches  It is possible that this simple arithmetic underestimates the impact of the falls in investment spending, particularly if the falls were concentrated in highly-productive forms of investment. Perhaps because in the face of the deep recession companies were less willing to undertake riskier, high-return investment projects, and the constraints on UK banks made them less willing to finance them.

This can be how monetary policy should be adjusted to the rate of the recovery from the financial crisis, how global market prices and exchange rates may affect monetary policy, the monetary policy consequences of alternative outcomes in central wage agreements, what will happen if the sovereign debt crisis in Europe worsens, and so on. We should therefore continue to make forecasts and draw up alternative scenarios as a basis for our monetary policy. Report the uncertainty involved in comparisons of repo-rate paths We should report the uncertainty involved in the comparisons of forecasts for economic developments with different repo-rate paths that we regularly describe in our Monetary Policy Reports. Calculations of alternative scenarios are often made using Ramses, for practical reasons. My personal opinion is that the calculated effects of changes in the repo-rate path are unreasonably large. If this is the case, we would need to adjust the repo rate more so that monetary policy is well balanced. However, one can in theory show that the greater the uncertainty prevailing as to the effects of the interest rate on inflation, the less monetary policy should react when inflation deviates from the target. Within the framework of Ramses it is possible to place in order of preference different monetary-policy alternatives in figures, based on their average squared deviations from the targets for inflation and resource utilisation during the forecast period (see Figure 13).24 These figures, unlike the fan charts shown earlier, do not report the uncertainty.
However, as pointed out in the same report, Turkey is at the bottom of the list in terms of costs for starting businesses (issuing licenses and permits after starting the business), regulations for firms exiting the industry, licensing procedures, ease of recruiting and employing workers. 2  BIS Review 37/2008  We can list transport vehicles, white goods and consumer-oriented electronic products such as radio and television as the sectors where Turkey’s competitive power is relatively high at present. The increased market share of China and India in these sectors poses a potential risk for the Turkish economy. In response to these risks, some structural reforms oriented towards domestic markets have been made, particularly during the process of Turkey’s accession to the EU. These regulations aim to ensure the integration of the Turkish economy with the EU on a sectoral basis and to strengthen the competitive power of our firms. It is not merely the relatively low labor costs that allow our firms to assume a position as important actors in international markets. Providing a stable macroeconomic structure for our economy is a must, but it is not enough. The qualified manpower of our country should be increased, our firms should be institutionally open to new developments and our industry should also adopt a structure that is not only demanding but also producing technology. To this end, it is of great importance to implement well-designed microeconomic reforms decisively. Competition policy is certainly one of the cornerstones of these reforms.

Voting power in the IMF is a balance of creditors’ interests, borrowers’ needs and that all members should be able to exercise influence. Membership of the IMF is open for all countries that meet certain criteria. Today, 182 countries are members, which means that very few countries do not take part in the IMF. This broad membership is one of the organisation’s strengths. The IMF’s head office is in Washington DC in the USA. Around 3,000 people work there. The major part are economists specialising in macroeconomics and international finance. The IMF board which decides on the day-to-day policy in the organisation is also located in Washington DC. The board meets at least three times per week. It has 24 seats, where all countries are represented, most of them in geographical groupings. The IMF’s purpose is to work for financial stability. In simple terms, this means ensuring that the various macroeconomic variables in a country – the exchange rate, inflation, the budget deficit, for instance - are dealt with in such a way that the economy can run smoothly and efficiently. A stable economy allows people to think in a long-term way when they invest and consume. Without stability, it is not possible to create sustainable growth. In Sweden, we have recent experiences of the opposite. The financial crisis here at the beginning of the 1990s increased unemployment and reduced production at the same time as government finances were dramatically weakened and Sweden entered the deepest recession since the 1930s.
We are also keeping a close eye on how domestic banks continue to respond to enhanced requirements on nonoperating deposits, which, for some institutions, are fairly large relative to the size of their reserve holdings. Should these business model changes increase the spread banks demand to borrow funds in money markets to earn IOR, or should business model decisions apparently related to regulatory changes alter broader dynamics in money markets, this could result in upward pressure on ON RRP take-up over time. We are also paying close attention to developments in the money market mutual fund industry and their potential impact on policy implementation.48 The Securities and Exchange Commission recently announced new regulations for these funds aimed at enhancing financial stability. One important feature of these new rules is that government-only money funds receive different regulatory treatment than prime funds, possibly making government-only funds more attractive for some institutional investors. If the assets under management in government-only money funds were to grow significantly, that could put upward pressure on ON RRP take-up, since most fund managers consider the facility to be a government investment.49 As I noted earlier, we would not want to see growth in government-only money funds if it were predicated on a mistaken impression that ON RRP would be around indefinitely and with high capacity. Also, if assets under management in prime funds were to decline sharply, this could possibly lead to less efficient transmission of monetary policy. Finally, we want to keep an eye on relative value relationships in money markets.

3  With the commencement of the policy normalization process in December 2015, the Federal Reserve began issuing an implementation note that provides the operational settings of the Federal Reserve's policy tools. This note serves to separate communications about the policy stance from those about policy implementation. It also promotes greater cohesion and transparency in communications about policy implementation by consolidating information that was previously provided in FOMC statements, FOMC minutes, Desk statements, and elsewhere. 4  An estimated historical series for an effective federal funds rate, produced using the new data source and calculation methodology, is available on the New York Fed’s website. This series will be updated at the end of February. 5  Demand for loans of reserves was driven, for example, by reserve requirements imposed on depository institutions. 6  I emphasize “all else equal.” There were many subtleties to the pre-crisis relationship between the operations and money market rates. In particular, money market rates would often move to a new target rate even before operations were conducted, because of the Federal Reserve’s credibility. Of course, that credibility was underpinned by the Federal Reserve’s actual operational capability. For a detailed exposition on pre-crisis monetary policy implementation, see Bernanke, “Implementing Monetary Policy,” March 30, 2005. 7  Of course, the Desk also controlled the level of reserves through permanent open market operations.
For those of us in charge of economic policy in our countries, it is absolutely essential that we strive to address these imbalances if they exist, and at the same time that we do not create them through our decisions. Over-stimulating the economy when output gaps are narrow and inflationary pressures have risen could lead to imbalances. I trust that they are not as sizeable as those of the developed world, but in any case solving them is always costly. On the other hand, it has taught us the relevance of maintaining and improving a good macroeconomic framework. In Chile, this framework rests on four pillars. First, monetary policy management is based on a flexible inflation-targeting regime, conducted by an autonomous central bank and supported by a floating exchange rate system. Second, a fiscal policy that is accountable and predictable thanks to a structural balance rule. The significant amount of savings accumulated during the run-up of copper prices has been a crucial factor in bolstering the resilience of the Chilean economy and in providing a countercyclical fiscal boost. Third, a high degree of commercial and financial integration with the rest of the world. Finally, a sound financial system, with globally integrated, well capitalized, and adequately-regulated banks. Our countries have suffered decades as a result of mistaken economic policies. The Great Recession showed that our current state of preparation to confront and mitigate the impact of an adverse scenario is much better than in the past, and that it is the path that we must continue.

When it then became clear that we and the Brits intended to remain on one side, our colleagues quite simply decided to postpone a number of important issues where we had strong views, including the monetary policy framework with inflation targeting, transparency, etc. This also applied to various payment system issues, where our position was weaker on the outside. If we now say “no” to membership, if not for good but at least for the foreseeable future, the situation will worsen further, as I have described already. I think this would be very unfortunate. BIS Review 39/2003
Some of these are very similar to those I have discussed earlier with regard to private stable coins such as the implications for the supply of credit to the economy if the role of banks changes, liquidity dynamics both in normal times and in stress, and the risk that a CBDC is too successful and becomes dominant and a single point of failure in itself. Those opportunities and those downsides, I think, mainly come back to one issue: the extent to which a CBDC substitutes for commercial bank money and payments in commercial bank money and, looking further ahead, for the non-bank money and payments that might emerge, such as stablecoins. In turn, this will depend on two fundamental questions. First, how great is public demand for a CBDC and how extensively and for what purpose would people want to use it? The answer to this, in turn, is driven by the answer to the second question: what functions would a CBDC perform? 11  All speeches are available online at www.bankofengland.co.uk/news/speeches  11  If we are to get the benefits of CBDC, some substitution must occur. The question is how to make this happen through the careful design of a CBDC to ensure it promotes stability and good economic outcomes. Design questions are critical. For example, who would be able to access CBDC directly? Would it be mainly a payments device and a cash like instrument? Or would it be able to serve as a mainstream vehicle for savings and store of value?

I am certain that over time these places will be your most profitable centers as places like Lusaka will only yield narrow margins due to stiff competition. Chairperson, Zambia’s economy has shown some resilience in the midst of the global economic crisis. As you are aware, the economy has posted some marked improvements in macroeconomic indicators in 2009 with GDP growth estimated at 6.3%. Both inflation and the yield rates on Government securities have edged downwards while the exchange rate of the Kwacha against major international currencies has also shown some stability in the recent months. It is for this reason that I reiterate my appeal to all financial service providers including Access Bank Zambia Limited, to make some meaningful efforts in addressing the high cost of banking services in the country. It is also my expectation that the banking sector will take advantage of opportunities arising from the conducive macroeconomic environment in the country to create wealth and contribute to the development in our economy. Finally, let me extend my gratitude to the Board of Directors and the Managing Director of Access Bank Zambia Limited for inviting me to officiate at this launch of the two branches and the Visa Debit Card. I also wish to particularly thank the Access Bank, Group Deputy Managing Director, Mr Herbert Wigwe for having travelled all the way from Nigeria, to come and be part of this event today. It now gives me great pleasure and honour to declare the Acacia and Longarces branches officially launched.
The less good news is that the worrying international imbalances within and between the industrial countries persisted through most of the past year - though just between you and me, my Lord Mayor, and so long as you don’t breath a word to the Chancellor, there is a glimmer of a suggestion - no more than that - that those imbalances may now be becoming somewhat less worrying. In the United States evidence of a sustained improvement in the rate of productivity growth has persisted. We, in this country, must fervently hope that the seeds of this technological modification are blown in our direction and find a receptive environment here. There is no obvious reason why we should be immune from this highly desirable infection - though sadly the symptoms of contamination are still hard to detect. In the meantime its supply-side effects in the United States imply that the US economy can sustain faster growth than seemed possible before, without necessarily overheating - at least for a time and up to a point. But the same developments have also helped to raise the temperature on the demand side of the US economy, and the Federal Reserve has been administering monetary sedatives at intervals throughout the past year. But finding exactly the right dosage, and the right timing, to keep the body temperature near normal in present circumstances really does demand the wisdom of Solomon - or at least the wisdom of Greenspan.

In the year to the first quarter total output grew by just over 3% while prices rose by 2.7% measured by the overall GDP 1  BIS Review 50/2000  deflator or by 2.1% on the Chancellor’s RPIX target measure. That is the fifth time in the past seven fiscal years that output growth has exceeded the rate of inflation. Since the recession of the early 1990s both output growth and inflation have averaged around 2¾%. The number of people in employment - as we saw from yesterday’s figures - is at an all time high. The rate of unemployment, on a claimant count basis is as low as it has been for 25 years. And interest rates over the past few years have been more stable and just about as low as anyone can remember. Now it’s true that there are uncertainties ahead - as there always are - which could make for a bumpier ride. The welcome weakening of sterling - which had risen to quite unrealistic levels against the exaggeratedly weak euro - will tend to reverse the downwards pressure that it had previously been exerting on retail prices. Domestic demand growth will need to moderate to compensate for that although there are some tentative signs in the recent data that it may be beginning to do so. The sustained tightness in the labour market could still put upwards pressure on earnings growth and pay settlements - though the latest data are somewhat reassuring for the time being.