Determination of the strange-quark mass from QCD pseudoscalar sum rules

A new determination of the strange-quark mass is discussed, based on the two-point function involving the axial-vector current divergences. This Green function is known in perturbative QCD up to order O(alpha_s^3), and up to dimension-six in the non-perturbative domain. The hadronic spectral function is parametrized in terms of the kaon pole, followed by its two radial excitations, and normalized at threshold according to conventional chiral-symmetry. The result of a Laplace transform QCD sum rule analysis of this two-point function is: m_s(1 GeV^2) = 155 pm 25 MeV.Comment: Invited talk given by CAD at QCD98, Montpellier, July 1998. To appear in Nucl.Phys.B Proc.Suppl. Latex File. Four (double column) page

A Re-Examination of Exchange Rate Exposure

Finance theory suggests that changes in exchange rates should have little influence on asset prices in a world with integrated capital markets. Indeed, the existing literature examining the relationship between international stock prices and exchange rates finds little evidence of systematic exchange rate exposure. We argue in this paper that the absence of evidence may be due to restrictions imposed on the sample of data and the empirical specifications used in previous studies. We study a broad sample of firms in eight countries over an eighteen-year period. We find that firm-level and industry-level share values are significantly influenced by exchange rates. Further, we do not find evidence that exchange rate exposure is falling (or becoming less statistically significant) over time. Our results suggest that significant firm, industry and country-specific differences remain even as financial markets become more and more "integrated".

Exchange Rate Exposure

In this paper we examine the relationship between exchange rate movements and firm value. We estimate the exchange rate exposure of publicly listed firms in a sample of eight (non-US) industrialized and emerging markets, and find that a significant percentage of these firms are indeed exposed. These results differ substantially from most previous studies in the literature that find little evidence of exposure. In robustness checks we find that: (i) the choice of exchange rate matters, and using the trade-weighted exchange rate is likely to understate the extent of exposure, (ii) conditioning on the value-weighted vs. the equally-weighted market index has little effect on estimated exposure, while conditioning on the international index does change the estimate of exposure, (iii) the extent of exposure is not a result of a spurious correlation between random variables with high variances, (iv) exposure increases with the return horizon, (v) within a country and within an industry, exposure coefficients are roughly evenly split between positive and negative values, (vi) averaging across the (absolute value of the) significant exposure coefficients in our sample of countries, we find an exposure coefficient of about 0.5, (vii) the extent of exposure is not sensitive to the sample period, but the set of firms that is exposed does vary over time, and (viii) the sign of the exposure coefficients changes across subperiods for about half of the firms of our sample. We find that exposure is not systematically related to firm size, industry affiliation, multinational status, foreign sales, international assets or industry-level trade.

International Borrowing and Macroeconomic Performance in Argentina

This paper provides an overview of the major economic events in Argentina from the adoption of the convertibility plan in 1991 to the collapse of the exchange rate regime in 2001. We focus on the relationship between the credibility of the currency board and capital flows, and the inescapable link between fiscal and monetary policy. Argentina inadvertently entered into a vicious circle with financial markets -- one in which it felt compelled to raise the exit costs from the currency board in order to maintain the regime%u2019s credibility. As exit costs mounted, financial markets became increasingly concerned about the dire implications of a devaluation, which in turn, compelled the government to raise exit costs further. In the late 1990s, when Argentina went into recession, it required some sort of stimulus -- either a loosening of monetary policy (i.e. a devaluation) or fiscal stimulus. But either way spelled disaster. The added pressure of capital outflow, first by international investors and then the withdrawal of deposits from the Argentine banking system, eventually tipped the scales.

Trade and Exposure

Are firms that engage in trade more vulnerable to exchange rate risk? Or, put another way, that exchange rate movements will influence firm asset value through the trade channel. In this paper we examine the relationship between exchange rate movements, firm value and trade. Our empirical work tests whether exchange rate exposure can be explained by variables that proxy for the level of international activity, firm size, industry affiliation and country affiliation. The results suggest that while a significant fraction of firms in these countries is exposed to exchange rate movements, there is little evidence of a systematic link between exposure and trade. Indeed, what little evidence there is of a link suggests that firms that engage in greater trade exhibit lower degrees of exposure. This may reflect the fact that those firms most engaged in trade are also the most aware of exchange rate risk, and therefore are the most likely to hedge their exposure.

A Re-Examination of Exchange Rate Exposure

Finance theory suggests that changes in exchange rates should have little influence on asset prices in a world that has become increasingly with integrated capital markets. Indeed, the existing literature examining the relationship between international stock prices and exchange rates finds little evidence of systematic exchange rate exposure. We argue in this paper that the absence of evidence may be due to restrictions imposed on the sample of data and the empirical specifications used in previous studies. We study a broad sample of firms in eight countries over an eighteen-year period. We find that firm-level and industry-level share values are significantly influenced by exchange rates. Further, we do not find evidence that exchange rate exposure is falling (or becoming less statistically significant) over time. Our results suggest that significant firm, industry and country-specific differences remain even as financial markets become more and more 'integrated'.

Trade and Exposure

Are firms that engage in trade more vulnerable to exchange rate risk? In this paper we examine the relationship between exchange rate movements, firm value and trade. Our empirical work tests whether exchange rate exposure can be explained by variables that proxy for the level of international activity, firm size, industry affiliation and country affiliation. The results suggest that while a significant fraction of firms in these countries is exposed to exchange rate movements, there is little evidence of a systematic link between exposure and trade. Indeed, what little evidence there is of a link suggests that firms that engage in greater trade exhibit lower degrees of exposure. This may reflect the fact that those firms most engaged in trade are also the most aware of exchange rate risk, and therefore are the most likely to hedge their exposure.

Granular-Scale Elementary Flux Emergence Episodes in a Solar Active Region

We analyze data from Hinode spacecraft taken over two 54-minute periods during the emergence of AR 11024. We focus on small-scale portions within the observed solar active region and discover the appearance of very distinctive small-scale and short-lived dark features in Ca II H chromospheric filtergrams and Stokes I images. The features appear in regions with close-to-zero longitudinal magnetic field, and are observed to increase in length before they eventually disappear. Energy release in the low chromospheric line is detected while the dark features are fading. In time series of magnetograms a diverging bipolar configuration is observed accompanying the appearance of the dark features and the brightenings. The observed phenomena are explained as evidencing elementary flux emergence in the solar atmosphere, i.e small-scale arch filament systems rising up from the photosphere to the lower chromosphere with a length scale of a few solar granules. Brightenings are explained as being the signatures of chromospheric heating triggered by reconnection of the rising loops (once they reached chromospheric heights) with pre-existing magnetic fields as well as to reconnection/cancellation events in U-loop segments of emerging serpentine fields. We study the temporal evolution and dynamics of the events and compare them with the emergence of magnetic loops detected in quiet sun regions and serpentine flux emergence signatures in active regions. Incorporating the novel features of granular-scale flux emergence presented in this study we advance the scenario for serpentine flux emergence.Comment: 24 pages, 9 figures. Accepted for publication in Solar Physic