Buy a home or rent? A better way to choose

Knowing whether buying a home is a better financial move for a family than renting requires a consideration of costs and options that people often neglect to factor in. One aspect of the calculation that is almost always overlooked is uncertainty—the fact that no matter how good one’s estimates of the future are, the future can turn out differently than projected. Incorporating uncertainty into the rent-or-buy calculation gives potential homebuyers information that can improve their decisions. While incorporating uncertainty is complicated, it’s made easier with the Cleveland Fed’s online calculator.Households - Finance ; Home ownership ; Rental housing

Effective practices in crisis resolution and the case of Sweden

The current financial crisis is a painful reminder that the developed world is not yet immune to these devastating shocks. But while we haven’t learned to prevent them, we have learned some lessons about what is necessary to contain them once they begin and to limit the damage that follows. As policymakers worldwide focus on resolving the current financial crisis, they might look to Sweden as a useful model for effective strategies.Financial crises - Sweden

Generalizing the Sampling Property of the Q-function for Error Rate Analysis of Cooperative Communication in Fading Channels

This paper extends some approximation methods that are used to identify closed form Bit Error Rate (BER) expressions which are frequently utilized in investigation and comparison of performance for wireless communication systems in the literature. By using this group of approximation methods, some expectation integrals, which are complicated to analyze and have high computational complexity to evaluate through Monte Carlo simulations, are computed. For these integrals, by using the sampling property of the integrand functions of one or more arguments, reliable BER expressions revealing the diversity and coding gains are derived. Although the methods we present are valid for a larger class of integration problems, in this work we show the step by step derivation of the BER expressions for a canonical cooperative communication scenario in addition to a network coded system starting from basic building blocks. The derived expressions agree with the simulation results for a very wide range of signal-to-noise ratio (SNR) values.Comment: 5 pages, 5 figures, Submitted to IEEE International Symposium on Information Theory, ISIT 2013, Istanbul, Turke

Market- vs. bank-based financial systems: do investor rights really matter?

Why are common-law countries market-dominated and civil-law countries bank-dominated when either financial structure can promote economic growth? This paper provides an explanation tied to legal traditions. Civil-law courts have been less effective in resolving conflicts than common-law courts because civil-law judges traditionally refrain from interpreting the codes and creating new rules. Banks can induce borrowers to honor their obligations by threatening to withhold services that only banks can provide.Comparative law ; Financial markets

Wireless Network Control with Privacy Using Hybrid ARQ

We consider the problem of resource allocation in a wireless cellular network, in which nodes have both open and private information to be transmitted to the base station over block fading uplink channels. We develop a cross-layer solution, based on hybrid ARQ transmission with incremental redundancy. We provide a scheme that combines power control, flow control, and scheduling in order to maximize a global utility function, subject to the stability of the data queues, an average power constraint, and a constraint on the privacy outage probability. Our scheme is based on the assumption that each node has an estimate of its uplink channel gain at each block, while only the distribution of the cross channel gains is available. We prove that our scheme achieves a utility, arbitrarily close to the maximum achievable utility given the available channel state information

Relationship loans and information exploitability in a competitive market: loan commitments vs. spot loans

Despite the numerous benefits of loan commitments, only 79% of the commercial and industrial loans are made under commitment. I show that two factors limit the use of loan commitments. First, because banks commit themselves to lend, they carry costly liquidity reserves to meet their obligations. Due to liquidity costs, the interest rate on commitment loans is high relative to spot loans. Second, high interest rates trigger moral hazard. If the bank expects a profitable relationship in the future, it can absorb a portion of the liquidity costs to reduce the interest rate and attenuate moral hazard. If not, the borrower cannot get a loan commitment.Bank loans