Non-Negativity of Nominal and Real Riskless Rates, Arbitrage Theory, and the Null-Alternative Cash

Pragmatic-world nominal riskless rates are non-negative. However, conventional arbitrage theory has yet to develop a theoretical justification of this phenomenon. – We define the null-alternative cash as an investor holding onto cash and refraining from investment and consumption ("doing nothing"); we use the null-alternative cash to prove that both nominal spot and nominal forward rates are non-negative and that prices of zero-coupon bonds do not increase with increasing maturity. In a positive inflation environment, however, both real spot and real forward rates might well become negative, but prices of zero-coupon bonds still do not increase with increasing maturity. --arbitrage theory,inflation,non-negativity of spot and forward rates,short selling constraints

Some economic remarks on arbitrage theory

Today's primarily mathematically oriented arbitrage theory does not address some economically important aspects of pricing. These are, first, the implicit conjecture that there is 'the' price of a portfolio, second, the exact formulation of no-arbitrage, price reproduction, and positivity of the pricing rule under short selling constraints, third, the explicit assumption of a nonnegative riskless interest rate, and fourth, the connection between arbitrage theory (that is almost universal pricing theory) and special pricing theories. Our article proposes the following answers to the above issues: The first problem can be solved by introducing the notion of 'physical' no-arbitrage, the second one by formulating the concept of 'actively' traded portfolios (that is non-dominated portfolios) and by requiring that there is a minimum price for actively traded portfolios and therefore for every admissible portfolio, and the third one by combining the 'invisible' asset 'cash' with the idea of actively traded portfolios - a riskless asset with a rate of return less than zero can never be actively traded in the presence of cash. Finally, the connection between arbitrage theory and special pricing theories ('law-of-one-price-oriented' and 'utility-oriented' pricing) consists in the fact that special pricing theories merely concretize arbitrage theory using different assumptions. --

Spatially-averaged momentum fluxes and stresses in flows over mobile granular beds : a DNS-based study

Acknowledgements The authors gratefully acknowledge the Centre for Information Services and High Performance Computing (ZIH), Dresden, and the Jülich Supercomputing Centre (JSC) for providing computing time. The authors thank Markus Uhlmann and Clemens Chan-Braun for stimulating discussions on bed-load transport. Funding The present work was funded by the German Research Foundation (DFG) via the project [FR 1593/5-2] and was partly supported by the Engineering and Physical Sciences Research Council (EPSRC) UK, Grant [EP/G056404/1].Peer reviewedPublisher PD

Momentum balance in flows over mobile granular beds : application of double-averaging methodology to DNS data

The authors gratefully acknowledge the Centre for Information Services and High Performance Computing (ZIH), Dresden, and the Jülich Supercomputing Centre (JSC) for providing computing time. The authors thank Markus Uhlmann and Clemens Chan-Braun for stimulating discussions on bed-load transport.Peer reviewedPublisher PD

The Effects of Supplementation with Omega-3 Polyunsaturated Fatty Acids on Cardiac Rhythm: Anti-Arrhythmic, Pro-Arrhythmic, Both or Neither? It Depends…

Supplementation of omega-3 fatty acids (Ω-3) has been associated with a decreased cardiovascular risk, thereby concentrating attention on a potentially preventive effect regarding tachyarrhythmias and sudden cardiac death. However, recent randomized controlled trials challenge the efficacy of the additional application of Ω-3 and its anti-arrhythmic effect under certain clinical conditions. The present paper reflects the results of earlier and recent clinical studies with respect to the individual background conditions that may determine the clinical outcome of Ω-3 supplementation and thereby explain apparently conflicting clinical results. It is concluded that the efficacy of Ω-3 supplementation to prevent cardiac arrhythmias strongly depends on the underlying clinical and pharmacological conditions, a hypothesis that also is supported by data from experimental animal studies and by molecular interactions of Ω-3 at the cellular level