Hedging Housing Risk

An unusually rich source of data on housing prices in Stockholm is used to analyze the investment implications of housing choices. This empirical analysis derives market-wide price and return series for housing investment during a 13-year period, and it also provides estimates of the individual-specific, idiosyncratic, variation in housing returns. Because the idiosyncratic component follows an autocorrelated process, the analysis of portfolio choice is dependent upon the holding period. We analyze the composition of household investment portfolios containing housing, common stocks, stocks in real estate holding companies, bonds and t-bills. For short holding periods, the efficient portfolio contains essentially no housing. For longer periods, low risk portfolios contain 15 to 50 percent housing. These results suggest that there are large potential gains from policies or institutions that would permit households to hedge their lumpy investments in housing. We estimate the potential value of hedges in reducing risk to households, yet yielding the same investment returns. The value is surprisingly large, especially to poorer homeowners.Portfolio Risk; House Price Index; Hedging

Adjustment in Property Space Markets: Estimates from the Stockholm Office Market

Markets for property space adjust only gradually because tenants are constrained by long-term leases and landlords and tenants face transactions and information costs. Not only do rents adjust slowly, but space occupancy may differ from demand at current rent, giving rise to %u201Chidden vacancies%u201D. We estimate the joint dynamics of office rents and vacancies using an error-correction model using a new lease rent series for Stockholm offices 1977­2002 estimated on 2,500 leases. It takes 5-10 years for the market to adjust to a shock. In a model simulation of a positive employment shock open vacancies fall from the natural level of 7 percent to below 4 percent, while hidden vacancies increase by about as much. Most of the variation in hidden vacancies over time is explained by the difference between demand at current and average rent on existing leases, which we calculate using data on contract lease length.

Synchronously-pumped OPO coherent Ising machine: benchmarking and prospects

The coherent Ising machine (CIM) is a network of optical parametric oscillators (OPOs) that solves for the ground state of Ising problems through OPO bifurcation dynamics. Here, we present experimental results comparing the performance of the CIM to quantum annealers (QAs) on two classes of NP-hard optimization problems: ground state calculation of the Sherrington-Kirkpatrick (SK) model and MAX-CUT. While the two machines perform comparably on sparsely-connected problems such as cubic MAX-CUT, on problems with dense connectivity, the QA shows an exponential performance penalty relative to CIMs. We attribute this to the embedding overhead required to map dense problems onto the sparse hardware architecture of the QA, a problem that can be overcome in photonic architectures such as the CIM

The Swedish Banking Crisis: Roots and Consequences

The article analyses the Swedish banking crisis in the early 1990s. Newly deregulated credit markets after 1985 stimulated a competitive process between financial institutions where expansion was given priority. Combined with an expansive macro policy, this contributed to an asset price boom. The subsequent crisis resulted from a highly leveraged private sector being simultaneously hit by three major exogenous events: a shift in monetary policy with an increase in pre-tax interest rates, a tax reform that increased after tax interest rates, and the ERM crisis. Combined with some overinvestment in commercial property, high real interest rates contributed to breaking the boom in real estate prices and triggering a downward price spiral resulting in bankruptcies and massive credit losses. The government rescued the banking system by issuing a general guarantee of bank obligations. The total direct cost to the taxpayer of the salvage has been estimated at around 2 per cent of GDP. I

Inviwo -- A Visualization System with Usage Abstraction Levels

The complexity of today's visualization applications demands specific visualization systems tailored for the development of these applications. Frequently, such systems utilize levels of abstraction to improve the application development process, for instance by providing a data flow network editor. Unfortunately, these abstractions result in several issues, which need to be circumvented through an abstraction-centered system design. Often, a high level of abstraction hides low level details, which makes it difficult to directly access the underlying computing platform, which would be important to achieve an optimal performance. Therefore, we propose a layer structure developed for modern and sustainable visualization systems allowing developers to interact with all contained abstraction levels. We refer to this interaction capabilities as usage abstraction levels, since we target application developers with various levels of experience. We formulate the requirements for such a system, derive the desired architecture, and present how the concepts have been exemplary realized within the Inviwo visualization system. Furthermore, we address several specific challenges that arise during the realization of such a layered architecture, such as communication between different computing platforms, performance centered encapsulation, as well as layer-independent development by supporting cross layer documentation and debugging capabilities

Ultralong-range radiative excitation transfer between quantum dots in a planar microcavity

We study the system of two quantum dots lying on the central plane of a planar semiconductor microcavity. By solving the full Maxwell problem, we demonstrate that the rate of resonant excitation transfer between the two dots decays as $d^{-1/2}$ as a function of the distance $d$ at long distance. This very long-range mechanism is due to the leaky and guided modes of the microcavity, which act as effective radiative transfer channels. At short distance, the $d^{-3}$ dependence of the F\"orster mechanism, induced by the electrostatic dipole-dipole interaction, is recovered

Chapter 3: Financial Crisis in Finland and Sweden

The Crisis of the 1990s in Finland and Sweden: The Nordic Experience of Financial Liberation -- Chapter 3: Financial Crisis in Finland and Sweden: Similar But Not Quite the Sam

Rate of comorbidities in giant cell arteritis : A population-based study

Objective. To compare the rate of occurrence of comorbidities, including severe infections, in a population-based cohort of patients with biopsy-proven giant cell arteritis (GCA) with a reference population in Southern Sweden. Methods. The study included a population-based cohort of biopsy-proven GCA cases diagnosed between 1998 and 2010 from the Skane region in Southern Sweden (population: 1.2 million). For each patient, 4 reference subjects were identified from the general population and matched for age, sex, area of residence, and date of diagnosis of GCA. Using the Skane Healthcare Register, comorbidities and severe infections (requiring hospitalization) diagnosed after GCA onset were identified. The rate of the first occurrence of each comorbidity was the result of dividing the number of subjects with a given comorbidity by the person-years of followup. The rate ratio (RR; GCA:reference population) was also calculated. Results. There were 768 patients (571 women) with GCA and 3066 reference persons included in the study. The RR were significantly elevated for osteoporosis (2.81, 95% CI 2.33-3.37), followed by venous thromboembolic diseases (2.36, 95% CI 1.61-3.40), severe infections (1.85, 95% CI 1.57-2.18), thyroid diseases (1.55, 95% CI 1.25-1.91), cerebrovascular accidents (1.40, 95% CI 1.12-1.74), and diabetes mellitus (1.29, 95% CI 1.05-1.56). The RR for ischemic heart disease was elevated, but did not reach statistical significance (1.20, 95% CI 1.00-1.44). Conclusion. Patients with GCA have higher rates of selected comorbidities, including severe infections, compared with a reference population. Several of these comorbidities may be related to treatment with glucocorticosteroids, emphasizing the unmet need to find alternative treatments for GCA