Currency Crises and Monetary Policy in an Economy with Credit Constraints:The No Interest Parity Case

This paper revisits the currency crises model of Aghion, Bacchetta and Banerjee (2000, 2001, 2004), who show that if there exist nominal price rigidities and private sector credit constraints, and the credit multiplier depends on real interest rates, then the optimal monetary policy response to the threat of a currency crisis is restrictive. We demonstrate that this result is primarily due to the uncovered interest parity assumption. Assuming that the exchange rate is a martingale restores the case for expansionary reaction - even with foreign-currency debt in firms' balance sheets. The effect of lower interest rates on output can help restore the value of the currency due to increased money demand

The Common-Trend and Transitory Dynamics in Real Exchange Rate Fluctuations

This study examines the behavior of both common-trend and transitory components of real exchange rate fluctuations under the current float. The common-trend component is in most cases found to be sizeable, albeit its relative importance can vary considerably across major currencies and its estimate can be sensitive to whether or not long-run PPP is imposed on the data. Further analysis suggests that both common-trend and transitory innovations are linked much more to interest rate changes than to productivity changes. Accordingly, it is interest rate, not productivity, disturbances that drive the highly persistent real exchange rate. JEL: F31, F41 Key Words: Real exchange rate; common trend; productivity effects; interest rate effects. * This is a substantially revised version of the discussion paper “Productivity shocks, monetary shocks, and the short-and long-run dynamics of exchange rates and relative prices. ” We have received valuable comments from Niels Arn

Histone/Protein Deacetylase 11 Targeting Promotes Foxp3+ Treg Function.

Current interest in Foxp3+ T-regulatory (Treg) cells as therapeutic targets in transplantation is largely focused on their harvesting pre-transplant, expansion and infusion post-transplantation. An alternate strategy of pharmacologic modulation of Treg function using histone/protein deacetylase inhibitors (HDACi) may allow more titratable and longer-term dosing. However, the effects of broadly acting HDACi vary, such that HDAC isoform-selective targeting is likely required. We report data from mice with constitutive or conditional deletion of HDAC11 within Foxp3+ Treg cells, and their use, along with small molecule HDAC11 inhibitors, in allograft models. Global HDAC11 deletion had no effect on health or development, and compared to WT controls, Foxp3+ Tregs lacking HDAC11 showed increased suppressive function, and increased expression of Foxp3 and TGF-β. Likewise, compared to WT recipients, conditional deletion of HDAC11 within Tregs led to long-term survival of fully MHC-mismatched cardiac allografts, and prevented development of transplant arteriosclerosis in an MHC class II-mismatched allograft model. The translational significance of HDAC11 targeting was shown by the ability of an HDAC11i to promote long-term allograft allografts in fully MHC-disparate strains. These data are powerful stimuli for the further development and testing of HDAC11-selective pharmacologic inhibitors, and may ultimately provide new therapies for transplantation and autoimmune diseases

Time dependent solitons of noncommutative Chern-Simons theory coupled to scalar fields

We study one- and two-soliton solutions of noncommutative Chern-Simons theory coupled to a nonrelativistic or a relativistic scalar field. In the nonrelativistic case, we find a tower of new stationary time-dependent solutions, all with the same charge density, but with increasing energies. The dynamics of these solitons cannot be studied using traditional moduli space techniques, but we do find a nontrivial symplectic form on the phase space indicating that the moduli space is not flat. In the relativistic case we find the metric on the two soliton moduli space.Comment: 22 pages, 2 figures, JHEP3 style. v2: This paper is a thoroughly revised version. We thank P.A. Horvathy, L. Martina and P.C. Stichel for illuminating comments that led us to reconsider some of our previously reported results; see note added at the end of the paper. v3: Acknowledgements adde

Domain Walls and the Creation of Strings

The phenomenon of creation of strings, occurring when particles pass through a domain wall and related to the Hanany-Witten effect via dualities, is discussed in ten and nine dimensions. We consider both the particle actions in massive backgrounds as well as the 1/4-supersymmetric particle-string-domain wall supergravity solutions and discuss their physical interpretation. In 10D we discuss the D0-F1-D8 system in massive IIA theory while in 9D the SL(2,R)-generalisation is constructed. It consists of (p,q)-particles, (r,s)-strings and the double domain wall solution of the three different 9D gauged supergravities where a subgroup of SL(2,R) is gauged.Comment: v1: 22 pages, 3 figures. v2: footnote and reference adde