Financial Crises and Macro-Prudential Policies

Stochastic general equilibrium models of small open economies with occasionally binding financial frictions are capable of mimicking both the business cycles and the crisis events associated with the sudden stop in access to credit markets (Mendoza, 2010). In this paper we study the inefficiencies associated with borrowing decisions in a two-sector small open production economy. We find that this economy is much more likely to display "under-borrowing" rather than "over-borrowing" in normal times. As a result, macro-prudential policies (i.e. Tobin taxes or economy-wide controls on capital inflows) are costly in welfare terms in our economy. Moreover, we show that macro-prudential policies aimed at minimizing the probability of the crisis event might be welfare-reducing in production economies. Our analysis shows that there is a much larger scope for welfare gains from policy interventions during financial crises. That is to say that, within our modeling approach, ex post or crisis-management policies dominate ex ante or macro-prudential ones.Capital controls, crises, financial frictions, macro prudential policies, bailouts,overborrowing

Revisiting Overborrowing and its Policy Implications

This paper analyzes quantitatively the extent to which there is overborrowing (i.e., inefficient borrowing) in a business cycle model for emerging market economies with production and an occasionally binding credit constraint. The main finding of the analysis is that overborrowing is not a robust feature of this class of model economies: it depends on the structure of the economy and its parametrization. Specifically, we find underborrowing in a production economy with our baseline calibration, but overborrowing with more impatient agents and more volatile shocks. Endowment economies display overborrowing regardless of parameter values, but they do not allow for policy intervention when the constraint binds (in crisis times). Quantitatively, the welfare gains from implementing the constrained efficient allocation are always larger near crisis times than in normal

Rumen-protected choline supplementation in periparturient dairy goats: effects on liver and mammary gland

The current study investigated the effects of supplementing rumen-protected choline (RPC) on metabolic profile, selected liver constituents and transcript levels of selected enzymes, transcription factors and nuclear receptors involved in mammary lipid metabolism in dairy goats. Eight healthy lactating goats were studied: four received no choline supplementation (CTR group) and four received 4 g RPC chloride/day (RPC group). The treatment was administered individually starting 4 weeks before expected kidding and continuing for 4 weeks after parturition. In the first month of lactation, milk yield and composition were measured weekly. On days 7, 14, 21 and 27 of lactation, blood samples were collected and analysed for glucose, β-hydroxybutyrate, non-esterified fatty acids and cholesterol. On day 28 of lactation, samples of liver and mammary gland tissue were obtained. Liver tissue was analysed for total lipid and DNA content; mammary tissue was analysed for transcripts of lipoprotein lipase (LPL), fatty acid synthase (FAS), sterol regulatory binding proteins 1 and 2, peroxisome proliferator-activated receptor γ and liver X receptor α. Milk yield was very similar in the two groups, but RPC goats had lower (P<0·05) plasma β-hydroxybutyrate. The total lipid content of liver was unaffected (P=0·890), but the total lipid/DNA ratio was lower (both P<0·05) in RPC than CTR animals. Choline had no effect on the expression of the mammary gland transcripts involved in lipid metabolism. The current plasma and liver data indicate that choline has a positive effect on liver lipid metabolism, whereas it appears to have little effect on transcript levels in mammary gland of various proteins involved in lipid metabolism. Nevertheless, the current results were obtained from a limited number of animals, and choline requirement and function in lactating dairy ruminants deserve further investigatio

Optimal capital controls and real exchange rate policies: A pecuniary externality perspective

In response to the global Önancial crisis a new policy paradigm emerged in which capital controls and other quantitative restrictions on credit áows have become part of the standard crisis prevention policy toolkit. A new strand of theoretical literature studies the use of capital controls in a context in which pecuniary externality justiÖes policy interventions. Within the same theoretical framework adopted in this literature, we show that the optimal design of crisis prevention (ex-ante) policies depends on the e§ectiviness of crisis management (ex-post) policies. This interaction between ex-ante and ex-post policies gives rise to a new rationale for the use of capital controls. SpeciÖcally, we show that when ex-post policies are e§ective in containing crises, there is no need to intervene ex-ante with capital controls. On the other hand, if crises management policies entail e¢ ciency costs and hence lose e§ectiveness, then the optimal policy mix consists of both ex-ante and ex-post interventions so that crises prevention policies become desirable. In our model, the optimal policy mix combines capital controls in tranquil times with real exchange rate support to limit its depreciation during crises times and yields welfare gains of more than 1% in consumption equivalence terms

Financial crises and macro-prudential policies

Stochastic general equilibrium models of small open economies with occasionally binding financial frictions are capable of mimicking both the business cycles and the crisis events associated with the sudden stop in access to credit markets (Mendoza, 2010). In this paper we study the inefficiencies associated with borrowing decisions in a two-sector small open production economy. We find that this economy is much more likely to display 'under-borrowing' rather than 'over-borrowing' in normal times. As a result, macro-prudential policies (i.e. Tobin taxes or economy-wide controls on capital inflows) are costly in welfare terms in our economy. Moreover, we show that macro-prudential policies aimed at minimizing the probability of the crisis event might be welfare-reducing in production economies. Our analysis shows that there is a much larger scope for welfare gains from policy interventions during financial crises. That is to say that, within our modeling approach, ex post or crisis-management policies dominate ex ante or macro-prudential ones

In Vitro Digestion of Chestnut and Quebracho Tannin Extracts : Antimicrobial Effect, Antioxidant Capacity and Cytomodulatory Activity in Swine Intestinal IPEC-J2 Cells

Quebracho (Qu) and chestnut (Ch) are natural sources of tannins and they are currently used in animal nutrition as feed ingredients. However, to date the bio-accessibility, antimicrobial, antioxidant, and intestinal epithelial cell stimulatory doses of Qu and Ch have not been determined. Our study investigates the antioxidant and E. coli F4+ and F18+ growth inhibitory activity of Qu, Ch, and their combinations after solubilization in water (to evaluate the already bio-accessible molecules) and after simulated gastro-intestinal digestion in vitro. The effect of an in vitro digested Ch and Qu combination was also tested on intestinal epithelial IPEC-J2 cells experimentally stressed with hydrogen peroxide (H2O2) and Dextran Sodium Sulfate (DSS). The results showed that undigested Qu and Ch alone, and in combination, exerted a valuable antioxidant capacity and E. coli F4+ and F18+ growth inhibitory activity. The concentration of 1200 \u3bcg/mL exhibited the highest E. coli growth inhibitory activity for all the samples tested. In addition, after in vitro digestion, Qu and Qu50%\u2013Ch50% maintained E. coli growth inhibitory activity and a modest antioxidant capacity. Three hours pre-treatment with in vitro digested Qu50%\u2013Ch50% counteracted the H2O2 and DSS experimentally-induced stress in the intestinal IPEC-J2 cells. Ch and Qu tannin extracts, particularly when combined, may exert E. coli F4+ and F18+ growth inhibitory activity and valuable antioxidant and cell viability modulation activities

Green tea and pomegranate extract administered during critical moments of the production cycle improves blood antiradical activity and alters cecal microbial ecology of broiler chickens

Phytobiotics are usually tested in feed and throughout the production cycle. However, it could be beneficial to evaluate their effects when administered only during critical moments, such as changes in feeding phases. The aim of the trial was to investigate the effect of a commercial plant extract (PE; IQV-10-P01, InQpharm Animal Health, Kuala Lumpur, Malaysia) on growth performance, blood antiradical activity and cecal microbiome when administered in drinking water to broiler chickens during the post-hatching phase and at each change of diet. In the experiment, 480 1-day-old male broiler chicks were assigned to two groups in a 50-day trial. Broilers received drinking water (C) or drinking water plus PE (T) at a rate of 2 mL/L on days 0 to 4, 10\u201311 and 20\u2013 21. PE did not affect performance and water intake, while total antiradical activity was improved (p &lt; 0.05). A greater abundance of lactic acid bacteria (false discovery rate (FDR) &lt; 0.05) was found in the T group and the result was confirmed at a lower taxonomic level with higher Lactobacillaceae abundance (FDR &lt; 0.05). Our findings suggest that PE administration during critical moments of the production cycle of broiler chickens may exert beneficial effects at a systemic level and on gut microbial ecology

Effects of putrescine, cadaverine, spermine, spermidine and β-phenylethylamine on cultured bovine mammary epithelial cells

A bovine mammary epithelial cell line (BME-UV1) and three-dimensional collagen primary bovine organoids were used to evaluate the effects of cadaverine, putrescine, spermine, spermidine and β-phenylethylamine on mammary epithelial cells. Each biogenic amine was diluted in several concentrations (0-50 mM in BME-UV1 and 0-4 mM in primary bovine organoids) in the appropriate saline solution for the cell culture considered. In order to determine the activity of each compound tritiated thymidine incorporation was used. At low concentrations, all amines induced cell proliferation in both cultures. In BME-UV1, spermine significantly inhibited cell proliferation (P<0.001), while the other amines inhibited at higher concentrations (50mM). In primary bovine organoids, β−phenylethylamine significantly (P<0.001) inhibited cell proliferation at 4 mM. Organoids cultured in the presence of all amines, except β-phenylethylamine, had stellate projections indicating intense cell proliferation. Proliferation of mammary epithelial cells was stimulated at low concentrations, while at high concentrations it was inhibited. Our results suggested that the effects of each compound on mammary epithelial cells could be related to the compound itself and not to mediating by the bovine amino oxidase, responsible of the formation of toxic metabolites

Milk whey as a sustainable alternative growth supplement to fetal bovine serum in muscle cell culture

In vitro meat cultivation, a cutting-edge innovation in food science, may represent a more sustainable and ethical source of animal proteins compared with conventionally grown meat. An important challenge for meat cultivation lies in eliminating the use of fetal bovine serum (FBS) in cell culture media due to ethical concerns. Milk whey is a nutrient-rich liquid portion of the milk, derived as a byproduct of dairy industry. Similar to FBS, whey contains proteins that are crucial for nutrition, cell adhesion, and biomolecular transport. In this study, we investigated whether whey proteins (WP) can replace FBS in supporting muscle cell cultivation, using the C2C12 myoblast model. Accordingly, under serum-free conditions, cells were treated with 2 WP mixtures, grouping high (β-LG 1.25%, α-LA 1.25%, BSA 1.25%) and low (β-LG 0.07%, α-LA 0.15%, BSA 0.15%) selected concentrations of individual proteins that positively affected cell growth in a preceding dose-response study. Cells cultured in only basal Dulbecco's Modified Eagle Medium were included as a negative control, and cells cultured in 10% FBS as a positive control. Cells were maintained in the treatment media for 48 h (d 1 and 2) to support myoblast proliferation. Subsequently, all the treatments were replaced with a standard low mitogenic 2% horse serum (HS) medium until full differentiation (d 6). The treatment effects on morphology, viability, and lactate dehydrogenase release were assessed after d 1, 2, and 6, respectively. The results showed that WP stimulated cell proliferation under serum-free culture conditions, similar to the FBS control, and subsequently facilitated myotube formation when the WP or FBS treatments were switched to HS medium. After differentiation, these cells also exhibited increased expression of cell differentiation markers such as creatine kinase and citrate synthase and underwent morphological changes from spindle-shaped cells to fused elongated myotubes, in contrast to the negative control. This study demonstrates that WP are a promising and sustainable alternative for considerably replacing FBS-based growth supplements for use in cultivated animal products

Role of alpha-tocopherol in counteracting DNA damage induced by Ochratoxin A in primary porcine fibroblasts

Ochratoxin A is a mycotoxin responsible for disease states in both humans and animals. OTA mechanisms of action are numerous, including lipid peroxidation. Oxidative damage results in the modification of macromolecules (i.e. DNA), cell death and tissue injure. Several strategies, such as the use of antioxidants, have been used to reduce OTA cytotoxicity. The aim of this study was to evaluate the role of alpha-tocopherol in counteracting DNA damage induced by OTA in cell cultures. Primary porcine fibroblasts, isolated from embryo and from ear, were incubated for 24h with several concentrations of OTA in order to detect DNA fragmentation. OTA produced DNA fragmentation in a concentration dependent manner in both primary cell cultures. The pre-treatment with alpha-tocopherol caused the reduction of DNA fragmentation in both primary cell cultures, after 24h of incubation with OTA. In particular, when OTA was added at 10 µg/ml in embryo fibroblasts, alpha-tocopherol at the concentrations of 1 nM was significantly (P<0.05) able to reduce DNA fragmentation by 16%. In ear fibroblast cultures, alpha-tocopherol at the 1nM concentration was significantly (P<0.05) able to reduce DNA fragmentation by 15.23% in the presence of 5 µg/ml of OTA