Archive for the ‘Speech / Interviews’ Category

Vítor Constâncio, Vice-President of the ECB: 34 years as a central banker!

May 24, 2018

Nice interview of Vítor Constâncio, the VP of ECB. He spent 34 years of his professional life as a central banker. He was twice the Governor of Central Bank of Portugal from 1985-86 and 2000-10.

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What is money exactly? Cod vs Code forms of money..

May 21, 2018

Jon Nicolaisen, Dep Governor of Norges Bank looks at features of money in this speech.

In Slide 15, there is this neat chart of differentiating paper money with digital money. Norway’s banknotes have pictures of Cods on them for trust whereas digital currency has code for trust. So we trust both cods and codes.

Slide 2 also has picture of the first banknote in Europe issued in Sweden.

Overall a nice and useful speech on money..

Should Federal Reserve issue e-USD?

May 18, 2018

Central bankers of most advanced economies have spoken on the subject of digital currency.  Federal Reserve has been reticent so far.

Thus, it is interesting to read this speech by Governor Lael Brainard of Federal Reserve. Should Fed issue an e-USD?

…there is no compelling demonstrated need for a Fed-issued digital currency. Most consumers and businesses in the U.S. already make retail payments electronically using debit and credit cards, payment applications, and the automated clearinghouse network. Moreover, people are finding easy ways to make digital payments directly to other people through a variety of mobile apps. New private-sector real-time payments solutions are beginning to gain acceptance in the United States. And the Faster Payments Task Force has laid out a roadmap embraced by a variety of stakeholders for a fast, ubiquitous, and secure payments system to be in place in the United States in the next few years. In short, a multiplicity of mechanisms are likely to be available for American consumers to make payments electronically in real time. As such, it is not obvious what additional value a Fed-issued digital currency would provide over and above these options.

Hmm..

Andy Haldane: Will big data keep its promise?

May 3, 2018

One must try and read most speeches by Andy Haldane of Bank of England. He has a flair for summing up a topic in a lucid and detailed manner.

In this speech, he looks at big data. How big data is like oil industry:

The first thing to say is that Big Data and data analytic techniques are not new. Nonetheless, over recent years they have become one of the most rapidly rising growth areas in academic and commercial circles. Over that period, data has become the new oil; data analytic techniques have become the oil extraction and refining plants of their time; and data companies have become the new oil giants.2

Yet economics and finance has, to date, been rather reticent about fully embracing this oil-rush. For economics and finance, the use of data analytic techniques has been the path less followed, at least relative to other disciplines. One simple diagnostic on that comes from looking at the very different interpretations put on the expression “data mining” by those inside and outside of economics and finance.

For economists, few sins are more heinous than data-mining. It is the last resort of a scoundrel to engage in “regression-hunting” – reporting only those regression results which best fit the hypothesis the researcher first set out to test. It is what puts the “con” into econometrics.3

For most economists, such data-mining has unfortunate similarities with oil-drilling – a dirty, extractive business which comes with big health warnings. For data scientists, the situation could not be more different. For them, the mining of data is a means of extracting valuable new resources and putting them to use. It enables new insights to be gained, new products to be created, new connections to be made, new technologies to be promoted. It provides the raw material for a new wave of productivity and innovation, an embryonic Fourth Industrial Revolution.

Then he explains the differences between deductive (theory to data) and inductive (data to theory) reasoning. Big data makes inductive reasoning possible in a ‘big way’ but it should be balanced with applying logic and thoughts to the trends.

Then there are three Vs in big data: volume, velocity and variety.

He even quotes/refers to some interesting research related to big data..

Best investment books for beginners…

May 1, 2018

Yesterday Vicky asked me which economics books should one read? I said this is a difficult question given the vastness of the subject. It is much better to pick a topic within economics and then figure the best books.

For instance, John Kay recommends 5 books on investing for beginners. He also shares key insights on investing and finance.

Why just beginners, most of the 5 books will go in for expert reading as well.

 

35 years of Diamond-Dybvig model of bank runs

April 26, 2018

Nice interview of Prof Dybvig where he narrates how the model was built and its implications..

Cryptocurrencies in the global economy: Norges Bank edition

April 20, 2018

One is summarising the speeches of several central bankers on digital and crypto currencies.

Here is Deputy Governor Jon Nicolaisen of Norway’s central bank. He does not think much of these digital currencies but says one should not miss on the potential of new technology.

 

Waqf – an economic perspective

April 12, 2018

A nice speech from  Mr Marzunisham Omar, Assistant Governor of the Central Bank of Malaysia. It is always interesting when central bankers give a much broader perspective than just interest rates and inflation.

In this piece Mr Omar discusses Waqf which is basically endowment in Islam and how to make most of this religious norm.

First some history of Waqf:

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The best books on the history of mathematics

March 30, 2018

Robin Wilson (Emeritus Professor of Pure Mathematics at the Open University) recommends 5 books to understand history of mathematics.

He says if math was taught more historically, students would appreciate it more.

Why should we be interested in the history of mathematics?

Mathematics, like painting, music, literature, has a long history. Indeed, it’s longer than most, since the first writing is believed to be numerical. It’s also multicultural, with its historical origins in Africa, the Middle East and Asia. The history of mathematics also involves particular individuals who are part of our world culture. Perhaps more school children would be interested in maths if it were taught more from a historical point of view. For example, how often do they learn that quadratic equations have been solved for 4000 years, having their origins in clay tablets discovered in what is now Iraq, an area that features in our daily newspapers?

Couldn’t agree more!

Noam Chomsky on the Populist Groundswell, U.S. Elections, the Future of Humanity, and More

March 23, 2018

Chomsky is always intriguing to read and figure. His recent interview is nothing different.

This one sums up:

Lynn Parramore: You’ve been looking at politics and international relations for quite a long time. Over the decades, what are the continuities in these areas that stand out in your view?

Noam Chomsky: Well the continuities are the message of the Athenians to Melos: “the powerful do what they wish and the weak suffer what they must” [from Thucydides’ History of the Peloponnesian War”]. It’s often disguised in humanitarian terms. The modalities and the context change. The situations change but the message stays the same.

He says Republican Party is the most dangerous organisation in human history:

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RBI Governor hits back at critics and absolves the central bank….

March 15, 2018

It is rare to hear speeches by the current RBI Governor and even rarer to see him hit back at critics of RBI’s role in the recent bank fraud.

In a hard hitting speech, he takes on several issues surrounding the bank fraud. The key part of the speech is that RBI does not have powers to regulate the Public Sector Banks as much as it has for private sector banks. In other words, the banking regulatory powers should be ownership neutral:

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Central Bank of Ireland to review Culture and Behaviour at key banks

March 12, 2018

I just blogged about how other central bankers are under pressure on banking crisis in other countries and there is no such pressure on Indian central bank. Ireland is one such example which is going through so called tracker mortgage scandal which saw how banks missold mortgage products.

In this speech, Derville Rowland (Director General at the central bank) says they are reviewing culture and behavior at key Irish banks:

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Should Czech issue e-koruna?

March 8, 2018

Central bankers of different countries are joining the debate of whether they should issue digital currencies. This blog has pointed to several such views: NZ, Denmark, Sweden, Finland, Australia and so on.

Mojmír Hampl, Vice Governor of the Czech National Bank in a recent speech gives the Czech perspective.

He says though there are many limitations with the idea , the philosophy behind the idea needs to be supported. It is ironical that econ academia was sleeping over any possible monetary reform and these ideas have instead come from IT sector. Atleast one central banker has honestly admitted this.

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The role of euro banknotes as legal tender..

February 15, 2018

Another speech from Yves Mersch of ECB who defends role of cash.

This speech is different as he looks at legal aspects of cash usage in Euroarea, what makes cash legal tender etc.:

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Past, Present and Future of Economics: An interview project

February 14, 2018

A superb series of interviews of leading economists on state of economics education and the need for pluralism.

Economics education has been discussed in the public domain for a long time,  but since the Global Financial Crisis it has come under renewed scrutiny. This interview project aims to provide material for new generations of economics students and scholars, as well as the general public, to get acquainted with different schools of economic thought and their bearing on economics thinking.

Distinguished economists speak on how the plurality of analytical traditions within economics has influenced their work. The interviews range from long-standing debates to current issues, and provide first-hand access to the thought of key contemporary economists.

This video series intends to promote pluralism by presenting schools of economic thought as viable methodological, theoretical and policy alternatives.

We have interviews of Profs Charles Goodhart, Sheila Dow, Geoff Harcourt, Tony Lawson Julie Nelson and Ha-Joon Chang…

Malaysia adopted inflation anchoring over inflation targeting…

February 12, 2018

Interesting speech by Mr Muhammad bin Ibrahim, Governor of the Central Bank of Malaysia.

He says despite strong preferences to adopt inflation targeting before 2008, the central bank did not straightjacket itself. They had a broader role with focus on inflation anchoring and not targeting. This way they avoided groupthink as well:

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Comparing crypto currencies across three functions of money: medium of exchange, unit of account and store of value

February 12, 2018

Yves Mersch of ECB speaks about the hot topic of cryptocurrencies.

Mersch is one of those odd central bankers as he prefers physical cash over cashless world. In this speech, he also dismisses private cryptocurrencies as well:

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Money in the digital age: what role for central banks?

February 8, 2018

This is the title of the speech by Agustín Carstens General Manager, Bank for International Settlements.

He has this amazing money flower ( I think have seen it elsewhere as well, not sure where):

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Evolution of Monetary and Exchange Rate Policy in Sri Lanka and the Way Forward

January 25, 2018

Nice speech by  Dr P Nandalal Weerasinghe, Senior Deputy Governor of the Central Bank of Sri Lanka. It discusses the history and evolution of monetary policy in Sri Lanka. Their central bank came up in 1950, 15 years after RBI:

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Differences between Development Banks and Wholesale and Long-Term Finance (WLTF) banks..

January 18, 2018

Dr YV Reddy spoke on the topic at the centenary of Indian Economics Association.

He chose the topic given recent RBI discussion on Wholesale and Long Term Financing Banks:

I chose the subject Development Banking for the lecture today because there is a revival of interest in development banking consequent upon the large amount of non-performing assets in the banking sector in India. It is believed that large part of NPAs, are on account of banks’ exposure to the infrastructure sector. It is now felt in some quarters that the universal banks are not the ideal institutions for
development of infrastructure. There is, therefore, interest in resurrecting Development Banks.

The Reserve Bank of India has circulated a discussion paper recently on Wholesale and Long-Term Finance (WLTF) banks. The discussion paper recognises the current problems faced by banking sector in long-term and project finance, in particular, infrastructure projects and also reflects the change in attitude of the RBI in regard to differentiated banks.

What is a development bank?

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