Do Options Contain Information About Excess Bond Returns?

There is strong empirical evidence that risk premia in long-term interest rates are time-varying. These risk premia critically depend on interest rate volatility, yet existing research has not examined the impact of time-varying volatility on excess returns for long-term bonds. To address this issue, we incorporate interest rate option prices, which are very sensitive to interest rate volatility, into a dynamic model for the term structure of interest rates. We estimate three-factor affine term structure models using both swap rates and interest rate cap prices. When we incorporate option prices, the model better captures interest rate volatility and is better able to predict excess returns for long-term swaps over short-term swaps, both in- and out-of-sample. Our results indicate that interest rate options contain valuable information about risk premia and interest rate dynamics that cannot be extracted from interest rates alone.

On the asset market view of exchange rates

If the asset market is complete, then the difference between foreign and domestic agents’ log intertemporal marginal rates of substitution (IMRSs) equals the log change in the real exchange rate. This equation is frequently used to argue that changes in real exchange rates reflect differences between agents’ required compensation for exposure to asset return uncertainty. We show that the relative returns on frictionlessly traded assets are only reflected in the common component of agents’ IMRSs, not in differences. Instead, when this equation does offer insights, frictions in the goods market are the source of economic distinction between agents

Free exopolysaccharide from Mycoplasma mycoides subsp. mycoides possesses anti-inflammatory properties

In this study we explored the immunomodulatory properties of highly purified free galactan, the soluble exopolysaccharide secreted by Mycoplasma mycoides subsp. mycoides (Mmm). Galactan was shown to bind to TLR2 but not TLR4 using HEK293 reporter cells and to induce the production of the anti-inflammatory cytokine IL-10 in bovine macrophages, whereas low IL-12p40 and no TNF-α, both pro-inflammatory cytokines, were induced in these cells. In addition, pre-treatment of macrophages with galactan substantially reduced lipopolysaccharide (LPS)-induced production of pro-inflammatory cytokines TNF- and IL-12p40 while increasing LPS-induced secretion of immunosuppressive IL-10. Also, galactan did not activate naïve lymphocytes and induced only low production of the Th1 cytokine IFN-γ in Mmm-experienced lymphocytes. Finally, galactan triggered weak recall proliferation of CD4+ T lymphocytes from contagious bovine pleuropneumonia-infected animals despite having a positive effect on the expression of co-stimulatory molecules on macrophages. All together, these results suggest that galactan possesses anti-inflammatory properties and potentially provides Mmm with a mechanism to evade host innate and adaptive cell-mediated immune responses. (Résumé d'auteur

Prevalence of oropharyngeal beta-lactamase-producing Capnocytophaga spp. in pediatric oncology patients over a ten-year period

BACKGROUND: The aim of this study was to evaluate the prevalence of beta-lactamase-producing Capnocytophaga isolates in young children hospitalized in the Pediatric Oncology Department of Hôpital Sud (Rennes, France) over a ten-year period (1993–2002). METHODS: In neutropenic children, a periodic survey of the oral cavity allows a predictive evaluation of the risk of systemic infections by Capnocytophaga spp. In 449 children with cancer, 3,053 samples were collected by oral swabbing and plated on TBBP agar. The susceptibility of Capnocytophaga isolates to five beta-lactams was determined. RESULTS: A total of 440 strains of Capnocytophaga spp. were isolated, 309 (70%) of which were beta-lactamase producers. The beta-lactamase-producing strains were all resistant to cefazolin, 86% to amoxicillin, and 63% to ceftazidime. The proportion of strains resistant to third-generation cephalosporins remained high throughout the ten-year study, while susceptibility to imipenem and amoxicillin combined with clavulanic acid was always conserved. CONCLUSION: These results highlight the risk of antibiotic failure in Capnocytophaga infections and the importance of monitoring immunosuppressed patients and testing for antibiotic susceptibility and beta-lactamase production

Engineering adeno-associated viral vectors to evade innate immune and inflammatory responses

Nucleic acids are used in many therapeutic modalities, including gene therapy, but their ability to trigger host immune responses in vivo can lead to decreased safety and efficacy. In the case of adeno-associated viral (AAV) vectors, studies have shown that the genome of the vector activates Toll-like receptor 9 (TLR9), a pattern recognition receptor that senses foreign DNA. Here, we engineered AAV vectors to be intrinsically less immunogenic by incorporating short DNA oligonucleotides that antagonize TLR9 activation directly into the vector genome. The engineered vectors elicited markedly reduced innate immune and T cell responses and enhanced gene expression in clinically relevant mouse and pig models across different tissues, including liver, muscle, and retina. Subretinal administration of higher-dose AAV in pigs resulted in photoreceptor pathology with microglia and T cell infiltration. These adverse findings were avoided in the contralateral eyes of the same animals that were injected with the engineered vectors. However, intravitreal injection of higher-dose AAV in macaques, a more immunogenic route of administration, showed that the engineered vector delayed but did not prevent clinical uveitis, suggesting that other immune factors in addition to TLR9 may contribute to intraocular inflammation in this model. Our results demonstrate that linking specific immunomodulatory noncoding sequences to much longer therapeutic nucleic acids can “cloak” the vector from inducing unwanted immune responses in multiple, but not all, models. This “coupled immunomodulation” strategy may widen the therapeutic window for AAV therapies as well as other DNA-based gene transfer methods

Editors’ Introduction: An Overview of the Educational Administration and Leadership Curriculum: Traditions of Islamic Educational Administration and Leadership in Higher Education

This chapter provides an overview of several topics relevant to constructing an approach to teaching educational administration and leadership in Muslim countries. First, it places the topic in the context of the changing nature and critiques of the field that argue for a greater internationalisation to both resist some of the negative aspects of globalisation and to represent countries’ traditions in the professional curriculum. Then, it identifies literature that presents the underlying principles and values of Islamic education that guide curriculum and pedagogy and shape its administration and leadership including the Qur’an and Sunnah and the classical educational literature which focuses on aims, values and goals of education as well as character development upon which a ‘good’ society is built. This is followed by a section on the Islamic administration and leadership traditions that are relevant to education, including the values of educational organisations and how they should be administered, identifying literature on the distinctive Islamic traditions of leadership and administrator education and training as it applies to education from the establishment of Islam and early classical scholars and senior administrators in the medieval period who laid a strong foundation for a highly sophisticated preparation and practice of administration in philosophical writings and the Mirrors of Princes writings, and subsequent authors who have built upon it up to the contemporary period. The final section provides an overview of the chapters in this collection

The Scarcity Value of Treasury Collateral: Repo Market Effects of Security-Specific Supply and Demand Factors

In the repo market, forward agreements are security-specific (i.e., there are no deliverable substitutes), which makes it an ideal place to measure the value of fluctuations in a security's available supply. In this study, we quantify the scarcity value of Treasury collateral by estimating the impact of security-specific demand and supply factors on the repo rates of all the outstanding U.S. Treasury securities. Our results indicate the existence of an economically and statistically significant scarcity premium, especially for shorter-term securities. The estimated scarcity effect is quite persistent, seems to be reflected in the Treasury market prices, and could in part explain the flow-effects of the Fed's asset purchase programs. More generally, it provides additional evidence in favor of the scarcity channel of quantitative easing. These findings also suggest that, through the same mechanism, the Fed's reverse repo operations could help alleviate potential shortages of high-quality collateral

Who makes on-the-run Treasuries special?

The most recently issued, on-the-run, Treasuries are extremely liquid and frequently trade at a premium in both the cash and repo, or financing, markets. Previous research suggests that both the cash and repo premiums reflect demand from buy-and-hold investors who value the superior liquidity of these securities and are reluctant to lend them in the repo market. We find evidence that premiums in the repo market are also closely related to market participants' demand to hedge interest rate risk associated with their holdings of fixed income securities.On-the-run Treasuries Short-selling Liquidity Repo specials Repurchase agreements