Are portfolio flows to emerging markets complementary or competitive?

Increasing portfolio investment flows to emerging markets in the past few years have led to fears of a sudden reversal of these flows and possible portfolio switching (from one emerging market to another) among foreign investors. To assess the sustainability of such portfolio flows, the author examines econometrically whether portfolio investment flows to one region in the developing world are significantly related to those going to another region. This question has important policy implications for policymakers in developing countries who, in considering domestic policy reforms to attract foreign portfolio investment, want to ascertain whether financial flows from abroad are coming from an increasing pool of investible resources in the industrial world or whether they represent the same funds chasing different high-yield securities as emerging markets change. In other words, does a sort of"adding-up"constraint apply to these flows - do they function as substitutes or not? Or could these flows be complementary? The author analyzes new quarterly World Bank data on gross portfolio investment flows for eight emerging markets (India, Indonesia, Korea, Thailand, Argentina, Brazil, Chile and Mexico) for the period from the first quarter of 1989 to the second quarter of 1993. Results indicate an inverse relationship between total portfolio flows to emerging Asian stock markets and those to Latin America. This negative relationship holds for both debt portfolio flows and equity portfolio flows. There has been a surge of portfolio flows to developing countries in the 1990s, but developing countries must compete for those flows. In the long term, portfolio flows to well-performing countries will be sustained because of improved creditworthiness and proportionately greater investor interest. Increasing the pace of reform in an emerging stock market is essential for sustaining portfolio flows.Environmental Economics&Policies,Banks&Banking Reform,Economic Theory&Research,International Terrorism&Counterterrorism,Financial Intermediation

Debt Management: Now the Difficult Part

The first years of the 21st century were characterized by more prudent macroeconomic policies in the developing world, the positive impact of debt relief on low-income countries (LICs), and positive growth trends for the world economy, despite the puncturing of the high-tech “bubble” in OECD countries. Until the eve of the financial crisis, many emerging economies were able to reduce the vulnerabilities of their debt portfolios and debt management was being carried out under favorable circumstances. Average maturities increased, reflecting increases in the maturities of new debt issuances, and rollover risks declined. Moreover, the increased availability of local currency financing, reflecting the development of domestic capital markets, and the globalization of the corporate sector in emerging economies underscored the changing landscape of development financing.debt, management, macroeconomic, debt relief, developing countries, low-income countries, bubble, portfolio, risks, maturities, financing

Therapeutic target-site variability in α1-antitrypsin characterized at high resolution

The intrinsic propensity of [alpha]1-antitrypsin to undergo conformational transitions from its metastable native state to hyperstable forms provides a motive force for its antiprotease function. However, aberrant conformational change can also occur via an intermolecular linkage that results in polymerization. This has both loss-of-function and gain-of-function effects that lead to deficiency of the protein in human circulation, emphysema and hepatic cirrhosis. One of the most promising therapeutic strategies being developed to treat this disease targets small molecules to an allosteric site in the [alpha]1-antitrypsin molecule. Partial filling of this site impedes polymerization without abolishing function. Drug development can be improved by optimizing data on the structure and dynamics of this site. A new 1.8 Å resolution structure of [alpha]1-antitrypsin demonstrates structural variability within this site, with associated fluctuations in its upper and lower entrance grooves and ligand-binding characteristics around the innermost stable enclosed hydrophobic recess. These data will allow a broader selection of chemotypes and derivatives to be tested in silico and in vitro when screening and developing compounds to modulate conformational change to block the pathological mechanism while preserving function

Growth diagnostics for a resource-rich transition economy : the case of Mongolia

This paper uses a growth diagnostics approach à la Hausmann, Rodrik, and Velasco (HRV) to identify the most'binding'constraints to private sector growth in Mongolia - a small, low-income, mineral-rich, transition economy. The approach of applying the HRV methodology is useful in those cases where a lack of data prevents us from estimating shadow prices to identify the most'binding'constraint to growth. We find that although Mongolia is not liquidity constrained and has grown rapidly in recent years, economic growth has been narrowly based. Investment has flowed mainly into a small number of firms operating in mining and construction. The low level of private investment in sectors outside mining and construction has been due to low returns - a result of costly and unreliable transportation services; lengthy and complex transit procedures, including customs and trade rules; distortionary taxes; coordination failures, at both domestic and international levels; and growing corruption. Poor financial intermediation is also a problem that has kept the cost of finance high, although lower than in previous years. Alleviating these binding constraints will ensure that Mongolia maintains the path towards sustained, broad-based growth.Transport Economics Policy&Planning,Debt Markets,Economic Theory&Research,,Emerging Markets

Factors that affect short-term commercial bank lending to developing countries

Developing countries rely on short-term trade credits for imports of several essential consumer goods, including medicines and basic food supplies. The credits also facilitate export-related transactions. The mechanisms commercial banks use to provide trade credits to developing countries are complex and costly. Even a temporary break in the flow of short-term credit can seriously hurt a country's business. But since short-term trade credits can be structured so that they involve a few risks to a bank and at the same time are very costly to the debtor, they are generally the last forms of credit to be cut and the first to be reestablished in debt-distressed developing countries. To gauge the likelihood of continued short-term trade related financial flows to developing countries, the authors examined the factors that affect short-term commercial bank loans. They studied relevant data over time for seven countries for which data were available: Argentina, Brazil, Egypt,India, Kenya, Mexico, and Turkey. They found that : a) countries with greater growth prospects get more short-term credit; b) short-term credits are usually meant to finance countries with significant trade deficits; c) higher levels of external indebtedness are generally coupled with higher levels of short-term indebtedness to commercial banks; and d) country-specific factors affect the volume of short-term lending to a country.Financial Intermediation,Banks&Banking Reform,Economic Theory&Research,Strategic Debt Management,Financial Crisis Management&Restructuring

Medicaid and the Elderly

We describe the Medicaid eligibility rules for the elderly. Medicaid is administered jointly by the Federal and state governments, and each state has significant flexibility on the details of the implementation. We document the features common to all states, but we also highlight the most salient state-level differences. There are two main pathways to Medicaid eligibility for people over age 65: either having low assets and income, or being impoverished due to large medical expenses. The first group of recipients (the categorically needy) mostly includes life-long poor individuals, while the second group (the medically needy) includes people who might have earned substantial amounts of money during their lifetime but have become impoverished by large medical expenses. The categorically needy program thus only affects the savings decision of people who have been poor throughout most of their lives. In contrast, the medically needy program provides some insurance even to people who have higher income and assets. Thus, this second pathway is to some extent going to affect the savings of the relatively higher income and assets people.

Polymers and inflammation: disease mechanisms of the serpinopathies

Members of the serpin (serine proteinase inhibitor) superfamily play a central role in the control of inflammatory, coagulation, and fibrinolytic cascades. Point mutations that cause abnormal conformational transitions in these proteins can trigger disease. Recent work has defined three pathways by which these conformers cause tissue damage. Here, we describe how these three mechanisms can be integrated into a new model of the pathogenesis of emphysema caused by mutations in the serpin α1-antitrypsin

Tensin1 expression and function in chronic obstructive pulmonary disease

open access articleChronic obstructive pulmonary disease (COPD) constitutes a major cause of morbidity and mortality. Genome wide association studies have shown significant associations between airflow obstruction or COPD with a non-synonymous SNP in the TNS1 gene, which encodes tensin1. However, the expression, cellular distribution and function of tensin1 in human airway tissue and cells are unknown. We therefore examined these characteristics in tissue and cells from controls and people with COPD or asthma. Airway tissue was immunostained for tensin1. Tensin1 expression in cultured human airway smooth muscle cells (HASMCs) was evaluated using qRT-PCR, western blotting and immunofluorescent staining. siRNAs were used to downregulate tensin1 expression. Tensin1 expression was increased in the airway smooth muscle and lamina propria in COPD tissue, but not asthma, when compared to controls. Tensin1 was expressed in HASMCs and upregulated by TGFβ1. TGFβ1 and fibronectin increased the localisation of tensin1 to fibrillar adhesions. Tensin1 and α-smooth muscle actin (αSMA) were strongly co-localised, and tensin1 depletion in HASMCs attenuated both αSMA expression and contraction of collagen gels. In summary, tensin1 expression is increased in COPD airways, and may promote airway obstruction by enhancing the expression of contractile proteins and their localisation to stress fibres in HASMCs

Three new Alpha1-Antitrypsin deficiency variants help to define a C-Terminal region regulating conformational change and polymerization

Alpha1-antitrypsin (AAT) deficiency is a hereditary disorder associated with reduced AAT plasma levels, predisposing adults to pulmonary emphysema. The most common genetic AAT variants found in patients are the mildly deficient S and the severely deficient Z alleles, but several other pathogenic rare alleles have been reported. While the plasma AAT deficiency is a common trait of the disease, only a few AAT variants, including the prototypic Z AAT and some rare variants, form cytotoxic polymers in the endoplasmic reticulum of hepatocytes and predispose to liver disease. Here we report the identification of three new rare AAT variants associated to reduced plasma levels and characterize their molecular behaviour in cellular models. The variants, called Mpisa (Lys259Ile), Etaurisano (Lys368Glu) and Yorzinuovi (Pro391His), showed reduced secretion compared to control M AAT, and accumulated to different extents in the cells as ordered polymeric structures resembling those formed by the Z variant. Structural analysis of the mutations showed that they may facilitate polymerization both by loosening ‘latch’ interactions constraining the AAT reactive loop and through effects on core packing. In conclusion, the new AAT deficiency variants, besides increasing the risk of lung disease, may predispose to liver disease, particularly if associated with the common Z variant. The new mutations cluster structurally, thus defining a region of the AAT molecule critical for regulating its conformational state

In silico assessment of potential druggable pockets on the surface of α1-Antitrypsin conformers

The search for druggable pockets on the surface of a protein is often performed on a single conformer, treated as a rigid body. Transient druggable pockets may be missed in this approach. Here, we describe a methodology for systematic in silico analysis of surface clefts across multiple conformers of the metastable protein α1-antitrypsin (A1AT). Pathological mutations disturb the conformational landscape of A1AT, triggering polymerisation that leads to emphysema and hepatic cirrhosis. Computational screens for small molecule inhibitors of polymerisation have generally focused on one major druggable site visible in all crystal structures of native A1AT. In an alternative approach, we scan all surface clefts observed in crystal structures of A1AT and in 100 computationally produced conformers, mimicking the native solution ensemble. We assess the persistence, variability and druggability of these pockets. Finally, we employ molecular docking using publicly available libraries of small molecules to explore scaffold preferences for each site. Our approach identifies a number of novel target sites for drug design. In particular one transient site shows favourable characteristics for druggability due to high enclosure and hydrophobicity. Hits against this and other druggable sites achieve docking scores corresponding to a Kd in the µM–nM range, comparing favourably with a recently identified promising lead. Preliminary ThermoFluor studies support the docking predictions. In conclusion, our strategy shows considerable promise compared with the conventional single pocket/single conformer approach to in silico screening. Our best-scoring ligands warrant further experimental investigation