Interest rate risk and other determinants of post WWII U.S. government debt/GDP dynamics

This paper uses a sequence of government budget constraints to motivate estimates of returns on the U.S. Federal government debt. Our estimates differ conceptually and quantitatively from the interest payments reported by the U.S. government. We use our estimates to account for contributions to the evolution of the debt-GDP ratio made by inflation, growth, and nominal returns paid on debts of different maturities.Holding period returns, capital gains, inflation, growth, debt- GDP ratio, government budget constraint

Accounting for the federal government's cost of funds

This article describes and defends the authors' corrections to the federal government's flawed measure of its cost of funds. Further, it examines how the maturity structure of the debt influences the way inflation risk and interest rate risk are shared by the government and its creditors.Gross domestic product ; Inflation (Finance) ; Interest rates

Mirror World at the Large Hadron Collider

A mirror world can modify in a striking way the LHC signals of the Higgs sector. An exact or approximate Z_2 symmetry between the mirror world and our world allows large mixing between the Higgs bosons of these worlds, leading to production rates and branching ratios for these states that are markedly different from the standard model and are characteristic of a mirror world. The constraints on these Higgs boson masses from precision electroweak data differ from the standard model bound, so that the new physics that cancels the quadratic divergence induced by the top quark may appear at a larger scale, possibly beyond the reach of the LHC. However, the scale of new physics needed to cancel the quadratic divergence induced by the Higgs boson is not significantly changed. With small breakings of the Z_2 parity, the lightest mirror quarks (and possibly charged mirror leptons) could be the dark matter in the universe, forming galactic halos that are stable to cooling. A possible signal from the relic radiation density of the mirror world is also discussed.Comment: 15 pages, 1 figur

Managing Option Fragility

We analyze and explore option fragility, the notion that option incentives are fragile due to their non-linear payoff structure. Option incentives become weaker as options fall underwater, leading to pressures to reprice options or restore incentives through additional grants of equity-based pay. We build a detailed data set on executives' portfolios of stock and options and find that executive options are frequently underwater, even when average stock returns have been high. For example, at the height of the bull market in 1999, approximately one-third of all executive options were underwater. We find that, in contrast to the incentives provided by stock, the incentives provided by options are quite sensitive to stock price changes, especially on the downside. Overall, we find that the incentives created by all executive holdings have an elasticity with respect to stock price decreases of about 0.7, and this elasticity is larger for high-option executives and for executives with high percentages of options already underwater. The dominant mechanism through which companies manage option fragility is larger option grants following stock price declines; on average, these larger grants restore approximately 40% of the stock-price-induced incentive declines. Option repricings are far less prevalent, despite the attention they have garnered. Interestingly, we find that for positive stock returns, higher returns lead to larger option grants, which raise incentives further. Thus, option grants are largest when companies do very poorly or very well. Executive exercising behavior also affects option fragility. Since executives are much less likely to exercise options following stock price decreases, the natural declines in incentives due to exercises are attenuated on the downside, leading executives to 'manage their own incentives' in a way that augments company management of option fragility.

Maximum observable correlation for a bipartite quantum system

The maximum observable correlation between the two components of a bipartite quantum system is a property of the joint density operator, and is achieved by making particular measurements on the respective components. For pure states it corresponds to making measurements diagonal in a corresponding Schmidt basis. More generally, it is shown that the maximum correlation may be characterised in terms of a `correlation basis' for the joint density operator, which defines the corresponding (nondegenerate) optimal measurements. The maximum coincidence rate for spin measurements on two-qubit systems is determined to be (1+s)/2, where s is the spectral norm of the spin correlation matrix, and upper bounds are obtained for n-valued measurements on general bipartite systems. It is shown that the maximum coincidence rate is never greater than the computable cross norm measure of entanglement, and a much tighter upper bound is conjectured. Connections with optimal state discrimination and entanglement bounds are briefly discussed.Comment: Revtex, no figure

Notary Public Certificate, 1917

Shortly after he was elected Attorney General in November 1917, William Langer became a notary public for the state of North Dakota. Notary publics officially witness the signing of important documents for legal purposes. Secretary of State Thomas Hall and Governor Lynn Frazier signed the certificate on November 28, 1917.https://commons.und.edu/langer-papers/1082/thumbnail.jp

The principle of equivalence and projective structure in space-times

This paper discusses the extent to which one can determine the space-time metric from a knowledge of a certain subset of the (unparametrised) geodesics of its Levi-Civita connection, that is, from the experimental evidence of the equivalence principle. It is shown that, if the space-time concerned is known to be vacuum, then the Levi-Civita connection is uniquely determined and its associated metric is uniquely determined up to a choice of units of measurement, by the specification of these geodesics. It is further demonstrated that if two space-times share the same unparametrised geodesics and only one is assumed vacuum then their Levi-Civita connections are again equal (and so the other metric is also a vacuum metric) and the first result above is recovered.Comment: 23 pages, submitted to Classical and Quantum Gravit