monitoring social, economic and geopolitical events

Monitoring social,

economic and geopolitical

events through Big Data

Tomasa Rodrigo, September 2020

48th World Continuous Auditing

and Reporting Symposium

Index

01 Opportunities in the digital era. Big Data at BBVA Research

02 Geopolitics, Trade and Spill overs

03 Big Data indicators to monitor the

economy in Real Time and High Definition

Opportunities in

the digital era.

Big Data at

BBVA Research

01

4Monitoring social, economic and geopolitical events through Big Data

Traditional data could not answer some

relevant questions

Geopolitical events

The use of Big Data and Data science techniques allows us to quantify these trends

Natural disasters and epidemics

Political events and social reaction


New framework in the digital era…

New answers to

old questions

Better and faster

infrastructure

New availability

of data

Higher computational abilities

to face more data granularity

Combination of historical

data with real time data

Advanced data science

techniques and algorithms


Deepening the

statistical and

econometric skills to

analyze and deal

with high-

dimensional data

Interpreting

the results:

summarize,

describe and

analyze the

information

Developing the

data management

and programming

capabilities to work

with large-scale

datasets

Making

the right

questions

…which needs the development of new

competences to take advantage of it

New data may end up changing the way in which economists approach

empirical questions and the tools they use to answer them


Internal and external diffusion of what

we do at BBVA Research

External

Institutions

Research

BBVA

External

institutions

Geopolitics,

Trade and

Spill overs

02


Text as a key source of information to enrich analysis

of the total amount of web

pages on the internet is given

by textual or unstructured data

Text miningto extract meaning from

strings of letters

It helps us to understand

what drives monetary

policy decisions

The potential use of textual information and

text sources improves the understanding of

the social, economic and financial systems

80%


80%

of available data

20%

of used data


What is GDELT?

Global Database on Events Location and Tone

Going further into the database

Open database of human society

from every corner of the globe

dating back to 1979 …

… including over 300 events

around the world and more than

30000 themes…

… georeferenced across

the entire planet…

…and collecting emotions

using some of the most

sophisticated algorithms


GDELT database and sentiment analysis

𝐀𝐯𝐞𝐫𝐚𝐠𝐞 𝐭𝐨𝐧𝐞 = 𝑃𝑜𝑠𝑖𝑡𝑖𝑣𝑒 𝑤𝑜𝑟𝑑𝑠 − 𝑁𝑒𝑔𝑎𝑡𝑖𝑣𝑒 𝑤𝑜𝑟𝑑𝑠

𝑇𝑜𝑡𝑎𝑙 𝑤𝑜𝑟𝑑𝑠

+Global Content Analysis Measures (GCAM)

𝟒𝟎 different 𝐬𝐞𝐧𝐭𝐢𝐦𝐞𝐧𝐭 𝐝𝐢𝐜𝐭𝐢𝐨𝐧𝐚𝐫𝐢𝐞𝐬to capture

more than 𝟐𝟑𝟎𝟎 𝐞𝐦𝐨𝐭𝐢𝐨𝐧𝐬 𝐚𝐧𝐝 𝐝𝐢𝐦𝐞𝐧𝐬𝐢𝐨𝐧𝐬with a value score


Tracking Geopolitics on real timeIs useful to identify the main hot spots and potential spillovers

Source: www.gdelt.org & BBVA Research

CONFLICT INTENSITY MAP 2017-18 (NUMBER OF CONFLICTS/ TOTAL EVENTS)

More detailed information can be found here

http://www.gdelt.org/

https://www.bbvaresearch.com/wp-content/uploads/2015/12/DEO_Dec15_Cap4.pdf


From an historical perspective…

BBVA RESEARCH WORLD CONFLICT

INTENSITY INDEX 1979-2018

WORLD PROTEST INTENSITY

MAP 1979- 2017

79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17

USA

UK

Norway

Sweden

Austria

Germany

France

Netherlands

Italy

Spain

Belgium

Ireland

Portugal

Greece

Poland

Czech Republic

Hungary

Bulgaria

Romania

Croatia

Turkey

Russia

Ukraine

Georgia

Kazakhstan

Moldova

Azerbaijan

Armenia

Morocco

Algeria

Tunisia

Libya

Egypt

Israel

Jordan

Syria

Iraq

Iran

UAE

Bahrain

Qatar

Oman

Saudi Arabia

Mexico

Brazil

Chile

Colombia

Peru

Argentina

Venezuela

China

Hong Kong

Korea

Thailand

Indonesia

Malaysia

Philippines

India

Pakistan

Afghanistan

EM

Eu

rop

e &

CIS

Develo

ped

Mark

ets

N.

Afr

ica &

Mid

dle

East

LA

TA

MA

sia

Protests Conflict




…to the current “hot” spots…

BBVA RESEARCH REFUGEES FLOWS MAP IN 2015-19NUMBER OF MEDIA CITATIONS ABOUT REFUGEES’ INFLOWS

AND OUTFLOWS

BBVA RESEARCH ASIA CONFLICT

INTENSITY INDEX 2008-19




SOCIAL UNREST EVENTS ACROSS THE WORLD: CAIRO, ISTANBUL AND HONG KONG CASESPROTEST EVENTS

… in “high definition”

2011 2015 2014




Exploring spillover effects: from the China’s

links with the rest of the world…

CHINESE SLOWDOWN: THE COUNTRY NETWORK AND THE MEDIA PERCEPTION

Oman

Qatar

Iran

Kazakhstan

Russia

U.A.E.

Iraq

NicaraguaSaudi ArabiaMexico

Chile

Dominican R.Brazil

Bolivia

Ecuador

Venezuela

Peru

Panama

Argentina

Spain

Austria

Ukraine

Israel

Greece

Poland

Belgium

Czech Republic

ItalyNetherlands

Finland

Ireland

Iceland

Portugal

Hungary

Yemen

Sri Lanka

Macau

Indonesia

Philippines

Taiwan

Cambodia

Pakistan

Turkey

Brunei

N. Zealand

Burkina Faso

Singapore

Thailand

Malaysia

Zimbabwe

UgandaNigeria

Zambia

CongoMozambique

Kenya

Sweden

Angola

E. Guinea

EthiopiaSouth Africa

France

US

UK

Japan

Australia

Canada

S. Korea India

Switzerland

Germany

Hong Kong

China




… to the world trade evolution from an historical perspective

BBVA RESEARCH WORLD TRADE SUPPORT INDEX(TONE & COVERAGE VERBAL COOPERATION AT WTO)

-2

0

2

4

6

8

10

12

19

95

19

96

19

97

19

98

19

99

20

00

20

01

20

02

20

03

20

04

20

05

20

06

20

08

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

Verbal Cooperation (3 months mov.avg)

Material Cooperation (3 months mov.avg)

BBVA RESEARCH TRADE SUPPORT INDEX

CHANGES 2008-17

THE GLOBAL INCIDENCE OF

PROTECTIONISM 2008-2015(GLOBAL TRADE ALERT)

Source: www.gdelt.org & BBVA ResearchMore detailed information can be found here


https://www.bbvaresearch.com/wp-content/uploads/2018/07/Exploring-the-global-trade-and-protectionism-in-real-time-using-Big-Data_.pdf


The FinTech Universe through the Eyes of the Media and Social

Networks

MOST USED TERMS IN THE FINTECH

UNIVERSE IN TWITTER

MEDIA SENTIMENT EVOLUTION OF FINTECH

ALL OVER THE WORLD 2015-2018(RED COLOURS INDICATE NEGATIVE TONE, GREEN

COLOURS POSITIVE TONE AND YELLOW ONES, NEUTRAL)


https://www.bbvaresearch.com/en/publicaciones/big-data-analysis/

Big Data indicators to

monitor the economy in

Real Time and High

Definition

03


Internal databases: working with aggregated and anonymized BBVA

Data to have indicators in real time and high definition

4 billion card transactions made by 14M people

710M card transactions from 1M PoS, made by

53M people, representing €43.000M

1.500M card transactions

from 1,1M PoS, made by

88M people, representing

€41.000M+ US, Colombia, Perú, Argentina


Positive growth in USA, Turkey, Mexico, Peru and Argentina. Spain

registered negative growth rates at the end of August, while Colombia

continued stagnant

Source: BBVA Research. * Proxied by USA Sunbelt

Spending at BBVA POS by BBVA and non-BBVA customers plus spending by BBVA customers at non-BBVA POS. This data considers final expenditures, so not intermediate consumption is included. Therefore, the

correspondence with national accounts household consumption is not fully equivalent. More detail about the data could be found in the following link.

BBVA RESEARCH BIG DATA CONSUMPTION INDICES(Total consumption by card, % YoY, 7D cumulative)

-70%

-50%

-30%

-10%

10%

30%

50%

6-J

an

20

-Jan

3-F

eb

17

-Fe

b

2-M

ar

16

-Mar

30

-Mar

13

-Apr

27

-Apr

11

-May

25

-May

8-J

un

22

-Jun

6-J

ul

20

-Jul

3-A

ug

17

-Aug

31

-Aug

Spain Turkey Mexico USA*

-30%

-10%

10%

30%

50%

70%

-70%

-50%

-30%

-10%

10%

30%

50%

6-J

an

20

-Jan

3-F

eb

17

-Fe

b

2-M

ar

16

-Mar

30

-Mar

13

-Apr

27

-Apr

11

-May

25

-May

8-J

un

22

-Jun

6-J

ul

20

-Jul

3-A

ug

17

-Aug

31

-Aug

Colombia Peru Argentina (right)

Hot Sale Days

Interactive charts with weekly updated information can be found here and more detailed information can be found here

https://www.bbvaresearch.com/en/publicaciones/tracking-the-covid-19-crisis-with-high-resolution-transaction-data/

https://www.bbvaresearch.com/en/special-section/charts/

https://www.bbvaresearch.com/en/publicaciones/the-covid-19-impact-on-consumption-in-real-time-and-high-definition-6/


Consumption Diffusion Heat Map: August led some recovery by

sector of activity in Peru, USA, Turkey and Spain

BBVA RESEARCH BIG DATA CONSUMPTION HEAT MAP (YoY, 7D cumulative)

Lower Growth Higher Growth

Series are coloured according to the history of each series since March 20 until the end of the series. The darker blue represents the lower 90% percentile and the lighter one represents the upper 10% percentile.

*Proxied by USA Sunbelt. Source: BBVA Research.

*

# # # # # # # # # # # # # # # # # 1 2 3 4 5 6 7 8 9 # 11 # # # # # # # # # # # # # # # # # # # 1 2 3 4 5 6 7 8 9 # 11 # # # # # # # # # # # # # # # # # # # # 1 2 3 4 5 6 7 8 9 # 11 # # # # # # # # # # # # # # # # # # # 1 2 3 4 5 6 7 8 9 # 11 # # # # # # # # # # # # # # # # # # # # 1 2 3 4 5 6 7 8 9 # 11 # # # # # # # # # # # # # # # # # # # #

JUL

Restaurants

MAY

Total consumptionSpainTurkey

APR AUGJUNMAR

Hotels

Mexico

USA*

ColombiaPeru

Argentina

Entertainment

FoodHealth

Transport

HealthTransport

Restaurants

Hotels

Food

Restaurants

Hotels

HotelsFoodHealth

TransportRestaurantsEntertainment

HotelsFoodHealth

Transport

Health

Entertainment

Entertainment

Entertainment

RestaurantsEntertainment

TransportRestaurants

FoodHealth

TransportRestaurantsEntertainment

HotelsFoodHealth

Transport

HotelsFood


Source: BBVA Research. * USA = Proxied by USA Sunbelt.

COLOMBIATURKEY USA*SPAIN MEXICO PERU

Technology matters: the gap between e-commerce growth and

physical purchases remained. Online sales are increasing in all the

countries, expect in Spain given the importance of travel expenditures

BBVA RESEARCH BIG DATA CONSUMPTION INDICES: PHYSICAL VS ONLINE(Total consumption by Point of Sales. % YoY, 7D cumulative. Pie chart reflects the proportion of online and physical purchases in 2019)


No big differences in card consumption patterns during August

compared with July

BBVA RESEARCH BIG DATA CONSUMPTION INDICES: TOTAL CONSUMPTION EVOLUTION IN AUGUST AND

SECTORIAL DISTRIBUTION* DURING THE MONTH (Bar chart: % YoY by week and month. Pie chart: % YoY by sector in August)

- 15% 3% 1% 7% 13% 20% 32%

*It should be take into account there are other categories of consumption not considered in the pie chart, so the total consumption is not equal to the average of the components of the chart

Source: BBVA Research. * USA = Proxied by USA Sunbelt

-20%

-10%

0%

10%

20%

30%

40%

50%

Colombia Mexico Spain Peru USA* Turkey Argentina

1 week (3-9Aug) 2 week (10-16Aug) 3 week (17-23Aug) 4 week (24-30Aug) August July


The Spanish recovery slowed among national consumers. Foreign

expenditure is still stagnant

SPAIN: AVERAGE EXPENDITURE BY SECTOR

(% YoY, 7D cumulative)

Source: BBVA Research

NATIONAL FOREIGN

-100%

-80%

-60%

-40%

-20%

0%

20%

40%

02

-Fe

b

16

-Fe

b

02

-Mar

16

-Mar

30

-Mar

13

-Apr

27

-Apr

11

-May

25

-May

08

-Jun

22

-Jun

06

-Jul

20

-Jul

03

-Aug

17

-Aug

31

-Aug

Bars & Restaurants Wellness and beautySports and toys FashionTransport Leisure & EntertainmentAccomodation Travel agenciesTotal

-100%

-80%

-60%

-40%

-20%

0%

20%

40%

60%

2-F

eb

16

-Fe

b

2-M

ar

16

-Mar

30

-Mar

13

-Apr

27

-Apr

11

-May

25

-May

8-J

un

22

-Jun

6-J

ul

20

-Jul

3-A

ug

17

-Aug

31

-Aug

Bars & Restaurants FashionTransport AccomodationFood Other servicesTotal


https://www.bbvaresearch.com/en/publicaciones/spain-impact-of-covid-19-on-consumption-in-real-time-and-high-frequency-august-31/


SPAIN: TOTAL AVERAGE WEEKLY EXPENDITURE BY PROVINCE*(Considering national and foreign cards and physical and online purchases . % YoY, 7D cumulative)

25-31 AUG EXPENDITURE (% YOY)

43/50 Spanish provinces are growing despite the stagnation of foreign

expenditure

Series are coloured according to the history of

each series. The darker blue represents the upper

90% percentile and the lighter one represents the

lower 10% percentile. Expenditure by BBVA client

and other Spanish cards registered in TPV BBVALower Growth Higher GrowthSource: BBVA Research


The BBVA Big Data for investment shows a high correlation with the

main investment aggregates, but giving us some anticipation to

have the more updated view of the Business Cycle…

TURKEY: GBBBVA BIG DATA INVESTMENT INDICES (28-day cum. YoY real )

Total Investment Maquinery & Equipment Construction

Source: BBVA Research

TURKEY: BBVA BIG DATA

INVESTMENT(28-day cum. YoY nominal in Invest.)

The "High Definition" sectorial information can help us to track the evolution of sectors in detail and differentiate

different shocks and to analyze regional economics to see how the provinces react to such shocks


https://www.bbvaresearch.com/en/publicaciones/global-investment-in-real-time-and-high-definition/


External databases: web scrapping and NPL techniques

Information extractionPre-Processing and

text parsingTransformation Text mining and NPL Sentiment analysis

Documents

Web pages

Extract words

Identify parts of speech

Tokenization and

multi-word tokens

Stopword Removal

Stemming

Case-folding

Text filtering

Indexing to quantify text

in lists of term counts

Create the Document-

term matrix

Weighting matrix

Factorization (SVD)

Analysis and Machine

learning

Topics extraction (LDA)

Clustering

Modelling (STM and

DTM)

Apply sentiment

dictionaries

Semantic analysis

and classification

Clustering

(More information can be found in the annex


Analyzing the Central Bank of Turkey, European Central Bank

and Federal Reserve monetary reports to understand monetary

policy decisions


https://www.bbvaresearch.com/en/publicaciones/a-big-data-approach-to-understand-central-banks/


Understanding the Interconnectedness between

Developed and Emerging Central Banks

PRE LEHMAN

(1999-2007)

CRISIS

(2007 -2013)

QE & RECALIBRATION

(2013-2018)

INFLATION TARGET

(2006-2008)

FINANCIAL CRISIS

(2009-2012)

THE GLOBAL POST-CRISIS

(2012-2017)

MONETARY POLICY IN DEVELOPED ECONOMIES AND RESPONSE IN THE EMERGING MARKETS (NETWORKS)

ECB

CBRT


You can find us at:

BBVA Research

Tomasa Rodrigo

@BBVAResearch

@TomasaRodrigo

Thank you!

www.bbvaresearch.com

Monitoring social,

economic and geopolitical

events through Big Data

Tomasa Rodrigo, September 2020

48th World Continuous Auditing

and Reporting Symposium