Four Pion Final States with Tagged Photons at Electron Positron Colliders

A Monte Carlo generator has been constructed to simulate the reaction e^+e^- \to \gamma + 4 \pi, where the photon is assumed to be observed in the detector. Only initial state radiation is considered. Additional collinear photon radiation has been incorporated with the technique of structure functions. Predictions are presented for cms energies of 1GeV, 3GeV and 10GeV, corresponding to the energies of DAPHNE, BEBC and of B-meson factories. The event rates are sufficiently high to allow for a precise measurement of R(Q^2) in the region of Q between approximately 1GeV and 2.5GeV. For the construction of the program we employ isospin relations between the amplitudes governing tau decays into four pions and electron positron annihilation into four pions. Estimates of the kinematic breaking of these isospin relations as a consequence of the \pi^- -- \pi^0 mass difference are given.Comment: LATEX, 27 pages, 9 figures, discussion of the kinematic breaking of isospin relations extended, typos corrected, some formulations change

Effects of Economic Interactions on Credit Risk

We study a credit risk model which captures effects of economic interactions on a firm's default probability. Economic interactions are represented as a functionally defined graph, and the existence of both cooperative, and competitive, business relations is taken into account. We provide an analytic solution of the model in a limit where the number of business relations of each company is large, but the overall fraction of the economy with which a given company interacts may be small. While the effects of economic interactions are relatively weak in typical (most probable) scenarios, they are pronounced in situations of economic stress, and thus lead to a substantial fattening of the tails of loss distributions in large loan portfolios. This manifests itself in a pronounced enhancement of the Value at Risk computed for interacting economies in comparison with their non-interacting counterparts.Comment: 24 pages, 6 figure