Central banks grappling with fast-changing financial technology and companies like Facebook moving into finance will aim to work together more closely through an innovation hub approved on Sunday by the Bank for International Settlements.
The BIS said the intention of the hub, which will be based in Basel, Hong Kong and Singapore, is to improve the functioning of the global financial system and it will identify and develop insights into trends in technology affecting central banking.
Facebook's plan to expand into payments and launch its own Libra cryptocurrency were not mentioned in the BIS statement, but the social media giant's move has helped crystallise opinion among central bankers on the urgency of coordinating regulatory responses to financial technology trends.
"The IT revolution knows no borders and therefore has repercussions in multiple locations simultaneously," BIS chairman Jens Weidmann said following the decision to create the hub at a BIS board meeting.
The hub will focus on helping central banks to "identify relevant trends in technology, supporting these developments where this is consistent with their mandate, and keeping abreast of regulatory requirements with the objective of safeguarding financial stability", he added.
Basel-based BIS, a central bank umbrella group, has already called on politicians to closely scrutinise Big Tech's incursion into finance, a move that raises questions about data privacy, competition, markets and banking.
Details about the hub were limited, and the BIS said it was not able to provide details on investment or staffing levels.
The Swiss National Bank (SNB), the Hong Kong Monetary Authority and the Monetary Authority of Singapore have all signed up to support the initiative.
SNB chairman Thomas Jordan said the central bank would step up its efforts in scrutinising new financial technology.
"The SNB is already keeping very close track of technological innovations in the financial area, and works actively within the central banking community in identifying and assessing relevant developments at an early stage," Mr Jordan said.
What the law says
Micro-retirement is not a recognised concept or employment status under Federal Decree Law No. 33 of 2021 on the Regulation of Labour Relations (as amended) (UAE Labour Law). As such, it reflects a voluntary work-life balance practice, rather than a recognised legal employment category, according to Dilini Loku, senior associate for law firm Gateley Middle East.
“Some companies may offer formal sabbatical policies or career break programmes; however, beyond such arrangements, there is no automatic right or statutory entitlement to extended breaks,” she explains.
“Any leave taken beyond statutory entitlements, such as annual leave, is typically regarded as unpaid leave in accordance with Article 33 of the UAE Labour Law. While employees may legally take unpaid leave, such requests are subject to the employer’s discretion and require approval.”
If an employee resigns to pursue micro-retirement, the employment contract is terminated, and the employer is under no legal obligation to rehire the employee in the future unless specific contractual agreements are in place (such as return-to-work arrangements), which are generally uncommon, Ms Loku adds.
How to keep control of your emotions
If your investment decisions are being dictated by emotions such as fear, greed, hope, frustration and boredom, it is time for a rethink, Chris Beauchamp, chief market analyst at online trading platform IG, says.
Greed
Greedy investors trade beyond their means, open more positions than usual or hold on to positions too long to chase an even greater gain. “All too often, they incur a heavy loss and may even wipe out the profit already made.
Tip: Ignore the short-term hype, noise and froth and invest for the long-term plan, based on sound fundamentals.
Fear
The risk of making a loss can cloud decision-making. “This can cause you to close out a position too early, or miss out on a profit by being too afraid to open a trade,” he says.
Tip: Start with a plan, and stick to it. For added security, consider placing stops to reduce any losses and limits to lock in profits.
Hope
While all traders need hope to start trading, excessive optimism can backfire. Too many traders hold on to a losing trade because they believe that it will reverse its trend and become profitable.
Tip: Set realistic goals. Be happy with what you have earned, rather than frustrated by what you could have earned.
Frustration
Traders can get annoyed when the markets have behaved in unexpected ways and generates losses or fails to deliver anticipated gains.
Tip: Accept in advance that asset price movements are completely unpredictable and you will suffer losses at some point. These can be managed, say, by attaching stops and limits to your trades.
Boredom
Too many investors buy and sell because they want something to do. They are trading as entertainment, rather than in the hope of making money. As well as making bad decisions, the extra dealing charges eat into returns.
Tip: Open an online demo account and get your thrills without risking real money.
WHAT IS A BLACK HOLE?
1. Black holes are objects whose gravity is so strong not even light can escape their pull
2. They can be created when massive stars collapse under their own weight
3. Large black holes can also be formed when smaller ones collide and merge
4. The biggest black holes lurk at the centre of many galaxies, including our own
5. Astronomers believe that when the universe was very young, black holes affected how galaxies formed
India Test squad
Kohli (c), Dhawan, Rahul, Vijay, Pujara, Rahane (vc), Karun, Karthik (wk), Rishabh Pant (wk), Ashwin, Jadeja, Kuldeep, Pandya, Ishant, Shami, Umesh, Bumrah, Thakur
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Director: James Gray
Stars: Brad Pitt, Tommy Lee Jones
Five out of five stars
