Quantitative Easing\u27s Effect on Shadow Banking: Have Federal Reserve Purchases Caused a Collateral Shortage in the Repurchase Agreement Market?

Since the start of the financial crisis in 2008, the Federal Reserve has been engaging in quantitative easing. Quantitative easing is a form of open market operation in which the Federal Reserve buys long-term U.S. government and other securities, versus traditional open market operations that occur through the short-term Treasury bill market. At the same time, the shadow bank system, which is a system of financial intermediaries that perform unregulated credit intermediation outside of traditional banks, has contracted significantly. Some argue that this contraction is due to a collateral crunch induced by quantitative easing in the shadow bank system—a crunch that occurred when the Federal Reserve’s quantitative easing program took high-quality collateral off the market. I will focus specifically on repurchase agreements, an instrument within the shadow banking that uses the same types of securities that the Federal Reserve has been buying during quantitative easing as collateral, to determine whether quantitative easing has led to a contraction of the repurchase agreement market. I find that increases in Federal Reserve asset holdings from 2005-2013, and specifically during QE1, are associated with decreases in primary dealer repurchase agreements. This shows that under certain circumstances, Federal Reserve asset purchases lead to contractions in the shadow bank system. This paper aims to increase understanding of how monetary policy affects shadow banking and understanding of the unintended consequences of monetary policy, such as decreased shadow bank lending caused by quantitative easing

The Edwards Aquifer Water Resource Conflict: Examining Impacts of USDA Programs

Resource /Energy Economics and Policy,

On the tear resistance of skin.

Tear resistance is of vital importance in the various functions of skin, especially protection from predatorial attack. Here, we mechanistically quantify the extreme tear resistance of skin and identify the underlying structural features, which lead to its sophisticated failure mechanisms. We explain why it is virtually impossible to propagate a tear in rabbit skin, chosen as a model material for the dermis of vertebrates. We express the deformation in terms of four mechanisms of collagen fibril activity in skin under tensile loading that virtually eliminate the possibility of tearing in pre-notched samples: fibril straightening, fibril reorientation towards the tensile direction, elastic stretching and interfibrillar sliding, all of which contribute to the redistribution of the stresses at the notch tip

Mechanical Competence and Bone Quality Develop During Skeletal Growth.

Bone fracture risk is influenced by bone quality, which encompasses bone's composition as well as its multiscale organization and architecture. Aging and disease deteriorate bone quality, leading to reduced mechanical properties and higher fracture incidence. Largely unexplored is how bone quality and mechanical competence progress during longitudinal bone growth. Human femoral cortical bone was acquired from fetal (n = 1), infantile (n = 3), and 2- to 14-year-old cases (n = 4) at the mid-diaphysis. Bone quality was assessed in terms of bone structure, osteocyte characteristics, mineralization, and collagen orientation. The mechanical properties were investigated by measuring tensile deformation at multiple length scales via synchrotron X-ray diffraction. We find dramatic differences in mechanical resistance with age. Specifically, cortical bone in 2- to 14-year-old cases exhibits a 160% greater stiffness and 83% higher strength than fetal/infantile cases. The higher mechanical resistance of the 2- to 14-year-old cases is associated with advantageous bone quality, specifically higher bone volume fraction, better micronscale organization (woven versus lamellar), and higher mean mineralization compared with fetal/infantile cases. Our study reveals that bone quality is superior after remodeling/modeling processes convert the primary woven bone structure to lamellar bone. In this cohort of female children, the microstructural differences at the femoral diaphysis were apparent between the 1- to 2-year-old cases. Indeed, the lamellar bone in 2- to 14-year-old cases had a superior structural organization (collagen and osteocyte characteristics) and composition for resisting deformation and fracture than fetal/infantile bone. Mechanistically, the changes in bone quality during longitudinal bone growth lead to higher fracture resistance because collagen fibrils are better aligned to resist tensile forces, while elevated mean mineralization reinforces the collagen scaffold. Thus, our results reveal inherent weaknesses of the fetal/infantile skeleton signifying its inferior bone quality. These results have implications for pediatric fracture risk, as bone produced at ossification centers during children's longitudinal bone growth could display similarly weak points. © 2019 American Society for Bone and Mineral Research

Standardized postnatal management of infants with congenital diaphragmatic hernia in Europe: The CDH EURO consortium consensus

Congenital diaphragmatic hernia (CDH) is associated with high mortality and morbidity. To date, there are no standardized protocols for the treatment of infants with this anomaly. However, protocols based on the literature and expert opinion might improve outcome. This paper is a consensus statement from the CDH EURO Consortium prepared with the aim of achieving standardized postnatal treatment in European countries. During a consensus meeting between high-volume centers with expertise in the treatment of CDH in Europe (CDH EURO Consortium), the most recent literature on CDH was discussed. Thereafter, 5 experts graded the studies according to the Scottish Intercollegiate Guidelines Network (SIGN) Criteria. Differences in opinion were discussed until full consensus was reached. The final consensus statement, therefore, represents the opinion of all consortium members. Multicenter randomized controlled trials on CDH are lacking. Use of a standardized protocol, however, may contribute to more valid comparisons of patient data in multicenter studies and identification of areas for further research

Gauss-Seidel method for multi-valued inclusions with Z mappings

We consider a problem of solution of a multi-valued inclusion on a cone segment. In the case where the underlying mapping possesses Z type properties we suggest an extension of Gauss-Seidel algorithms from nonlinear equations. We prove convergence of a modified double iteration process under rather mild additional assumptions. Some results of numerical experiments are also presented. © 2011 Springer Science+Business Media, LLC

Noncooperative games with vector payoffs under relative pseudomonotonicity

We consider the Nash equilibrium problem with vector payoffs in a topological vector space. By employing the recent concept of relative (pseudo) monotonicity, we establish several existence results for vector Nash equilibria and vector equilibria. The results strengthen in a major way existence results for vector equilibrium problems which were based on the usual (generalized) monotonicity concepts

Gauss-Seidel method for multi-valued inclusions with Z mappings

We consider a problem of solution of a multi-valued inclusion on a cone segment. In the case where the underlying mapping possesses Z type properties we suggest an extension of Gauss-Seidel algorithms from nonlinear equations. We prove convergence of a modified double iteration process under rather mild additional assumptions. Some results of numerical experiments are also presented. © 2011 Springer Science+Business Media, LLC

Characterizations of relatively generalized monotone maps

New concepts of relative monotonicity were introduced in Konnov (Oper Res Lett 28:21-26, 2001a) which extend the usual ones. These concepts enable us to establish new existence and uniqueness results for variational inequality problems over product sets. This paper presents first-order characterizations of new (generalized) monotonicity concepts. Specialized results are obtained for the affine case. © Springer-Verlag 2007