Credit default swaps and financial stability: risks and regulatory issues.

The credit default swap (CDS) market has grown much faster than other derivatives markets since its inception. Even though it is dwarfed by the interest rate derivatives market, which is eight times larger, its growth has affected the stability of the financial system. CDS were originally designed as a risk transfer tool to allow investors to hedge their position in the debt of a reference entity, but much of the activity in this market is also speculative (Olléon-Assouan, 2004). Risk management in the CDS market has certainly improved significantly, reflected in the fact that gross notional volumes have fallen remarkably as a result of trade compression. Nevertheless there is still no accurate indication of how much risk has actually been transferred with these instruments, and this is a major concern for financial stability. Even a rough estimate of market size ranges from USD 29 trillion to USD 38 trillion at end-2008. Clarifying and harmonising information is vitally important, particularly since the uncertainty surrounding market participants’ risk exposure contains the seeds of systemic contagion. There is now a pressing need for better market supervision based on the active participation of regulators. The task has already been made easier by a number of public and private initiatives aimed at improving the functioning of the market and monitoring risks more effectively. The most tangible evidence of these combined efforts can be found in various plans for a clearinghouse that emerged in 2008 and 2009. Aside from its practical limitations, however, this solution cannot be extended to all CDS classes. And regulators still face the sizeable challenge of assessing overall counterparty risk on the CDS market and preventing concentration and formation of systemic exposures.

High Speed Chaos in Optical Feedback System with Flexible Timescales

We describe a new opto-electronic device with time-delayed feedback that uses a Mach-Zehnder interferometer as passive nonlinearity and a semiconductor laser as a current-to-optical-frequency converter. Bandlimited feedback allows tuning of the characteristic time scales of both the periodic and high dimensional chaotic oscillations that can be generated with the device. Our implementation of the device produces oscillations in the frequency range of tens to hundreds of MHz. We develop a model and use it to explore the experimentally observed Andronov-Hopf bifurcation of the steady state and to estimate the dimension of the chaotic attractor.Comment: 7 pages, 6 figures, to be published in IEEE J. Quantum Electro

Competition between Electromagnetically Induced Transparency and Raman Processes

We present a theoretical formulation of competition among electromagnetically induced transparency (EIT) and Raman processes. The latter become important when the medium can no longer be considered to be dilute. Unlike the standard formulation of EIT, we consider all fields applied and generated as interacting with both the transitions of the $\Lambda$ scheme. We solve Maxwell equations for the net generated field using a fast-Fourier-transform technique and obtain predictions for the probe, control and Raman fields. We show how the intensity of the probe field is depleted at higher atomic number densities due to the build up of multiple Raman fields.Comment: 3.5 pages, 7 figure

Controlling Fast Chaos in Delay Dynamical Systems

We introduce a novel approach for controlling fast chaos in time-delay dynamical systems and use it to control a chaotic photonic device with a characteristic time scale of ~12 ns. Our approach is a prescription for how to implement existing chaos control algorithms in a way that exploits the system's inherent time-delay and allows control even in the presence of substantial control-loop latency (the finite time it takes signals to propagate through the components in the controller). This research paves the way for applications exploiting fast control of chaos, such as chaos-based communication schemes and stabilizing the behavior of ultrafast lasers.Comment: 4 pages, 4 figures, to be published in Physical Review Letter

Crystal-to-crystal transition of ultrasoft colloids under shear

Ultrasoft colloids typically do not spontaneously crystallize, but rather vitrify, at high concentrations. Combining in-situ rheo-SANS experiments and numerical simulations we show that shear facilitates crystallization of colloidal star polymers in the vicinity of their glass transition. With increasing shear rate well beyond rheological yielding, a transition is found from an initial bcc-dominated structure to an fcc-dominated one. This crystal-to-crystal transition is not accompanied by intermediate melting but occurs via a sudden reorganization of the crystal structure. Our results provide a new avenue to tailor colloidal crystallization and crystal-to-crystal transition at molecular level by coupling softness and shear

Evidence for spin liquid ground state in SrDy2_2O4_4 frustrated magnet probed by muSR

Muon spin relaxation ($\mu$SR) measurements were carried out on SrDy$_2$O$_4$, a frustrated magnet featuring short range magnetic correlations at low temperatures. Zero-field muon spin depolarization measurements demonstrate that fast magnetic fluctuations are present from $T=300$ K down to 20 mK. The coexistence of short range magnetic correlations and fluctuations at $T=20$ mK indicates that SrDy$_2$O$_4$ features a spin liquid ground state. Large longitudinal fields affect weakly the muon spin depolarization, also suggesting the presence of fast fluctuations. For a longitudinal field of $\mu_0H=2$ T, a non-relaxing asymmetry contribution appears below $T=6$ K, indicating considerable slowing down of the magnetic fluctuations as field-induced magnetically-ordered phases are approached.Comment: 6 pages, 4 figures, to be published as a proceeding of HFM2016 in Journal of Physics: Conference Series (JPCS

Direct imaging of a digital-micromirror device for configurable microscopic optical potentials

Programable spatial light modulators (SLMs) have significantly advanced the configurable optical trapping of particles. Typically, these devices are utilized in the Fourier plane of an optical system, but direct imaging of an amplitude pattern can potentially result in increased simplicity and computational speed. Here we demonstrate high-resolution direct imaging of a digital micromirror device (DMD) at high numerical apertures (NA), which we apply to the optical trapping of a Bose-Einstein condensate (BEC). We utilise a (1200 x 1920) pixel DMD and commercially available 0.45 NA microscope objectives, finding that atoms confined in a hybrid optical/magnetic or all-optical potential can be patterned using repulsive blue-detuned (532 nm) light with 630(10) nm full-width at half-maximum (FWHM) resolution, within 5% of the diffraction limit. The result is near arbitrary control of the density the BEC without the need for expensive custom optics. We also introduce the technique of time-averaged DMD potentials, demonstrating the ability to produce multiple grayscale levels with minimal heating of the atomic cloud, by utilising the high switching speed (20 kHz maximum) of the DMD. These techniques will enable the realization and control of diverse optical potentials for superfluid dynamics and atomtronics applications with quantum gases. The performance of this system in a direct imaging configuration has wider application for optical trapping at non-trivial NAs.Comment: 9 page

Patterns in hydraulic ripples with binary granular mixtures

An experimental study of a binary granular mixture submitted to a transient shear flow in a cylindrical container is reported. The formation of ripples with a spiral shape is observed. The appearance of phase segregation in those spiral patterns is shown. The relative grain size bewteen sand species is found to be a relevant parameter leading to phase segregation. However, the relative repose angle is an irrelevant parameter. The formation of sedimentary structures is also presented. They result from a ripple climbing process. The ``sub-critical'' or ``super-critical'' character of the lamination patterns is shown to depend on the rotation speed of the container.Comment: 9 pages, 9 figures, LateX (using elsart package), submitted to Phys.