Monopoly rents and price fixing in betting markets

Betting markets provide an ideal environment in which to examine monopoly power due to the availability of detailed information on product pricing. In this paper we argue that the pricing strategies of companies in the UK betting industry are likely to be an important source of monopoly rents, particularly in the market for forecast bets. Pricing in these markets are shown to be explicitly coordinated. Further, price information is asymmetrically biased in favor of producers. We find evidence, based on UK data, that pricing of CSF bets is characterized by a significantly higher markup than pricing of single bets. Although this differential can in part be explained by the preferences of bettors, it is reasonable to attribute a significant part of the differential as being due to monopoly power

Do depositors care about enforcement actions?

Since 1990, federal bank supervisors have publicly announced formal enforcement actions. This change in regime provides a natural laboratory to test two propositions: (1) claims by economists that putting confidential supervisory information in the public domain will enhance market discipline and (2) claims by bank supervisors that releasing such data will spark runs. To evaluate these propositions, we measure depositor reaction to 87 Federal Reserve announcements of enforcement actions. We compare deposit growth rates and yield spreads before and after the announcements at the sample banks and a control group of peer banks. The data show no evidence of unusual deposit withdrawals or spread increases at the sample banks following the announcements of formal actions. These results suggest that public announcements of enforcement actions did not spark bank runs or enhance depositor discipline. Apparently, depositors did not care a great deal about our sample actions.Bank supervision ; Deposit insurance

Lidar measurements of thermal structure

Rayleigh backscatter observations at 532 nm and 355 nm of relative atmospheric density above Aberystwyth on a total of 93 nights between Dec. 1982 and Feb. 1985 were used to derive the height variation of temperature in the upper stratosphere and mesosphere. Preliminary results for height up to about 25 km were also obtained from observations of Raman backscattering from nitrogen molecules. Comparisons were carried out for stratospheric heights with satellite borne measurements; good agreement was found between equivalent black body temperatures derived from the lidar observations and those obtained from nadir measurements in three channels of the stratosphere sounder units on NOAA satellites; the lidar based atmospheric temperatures have shown general agreement with but a greater degree of structure than the limb sounding measurements obtained using the SAMS experiment on the NOAA-7 satellite. In summer, stratospheric and mesospheric temperatures showed a smooth height variation similar to that of the CIRA model atmosphere. In contrast, the winter data showed a great variability with height, and marked temperature changes both from night to night and within a given night

Observations of stratospheric aerosols associated with the El Chichon eruption

Lidar observations of aerosols were carried out at Aberystwyth between Nov. 1982 and Dec. 1985 using a frequency doubled and frequency tripled Nd/Yag laser and a receiver incorporating a 1 m diameter in a Newtonian telescope configuration. In analyses of the experimental data attention is paid to the magnitude of the coefficient relating extinction and backscatter, the choice being related to the possible presence of aerosols in the upper troposphere and the atmospheric densities employed in the normalisation procedure. The aerosol loading showed marked day to day changes in early months and an overall decay was apparent only after April 1983, this decay being consistent with an e sup -1 time of about 7 months. The general decay was accompanied by a lowering of the layer but layers of aerosols were shown intermittently at heights above the main layer in winter months. The height variations of photon counts corrected for range, or of aerosol backscatter ratio, showed clear signatures of the tropopause. A strong correlation was found between the heights of the tropopause identified from the lidar measurements and from radiosonde-borne temperature measurements. A notable feature of the observations is the appearance of very sharp height gradients of backscatter ratio which seem to be produced by differential advection

Multirole cargo aircraft options and configurations

A future requirements and advanced market evaluation study indicates derivatives of current wide-body aircraft, using 1980 advanced technology, would be economically attractive through 2008, but new dedicated airfreighters incorporating 1990 technology, would offer little or no economic incentive. They would be economically attractive for all payload sizes, however, if RD and T costs could be shared in a joint civil/military arrangement. For the 1994-2008 cargo market, option studies indicate Mach 0.7 propfans would be economically attractive in trip cost, aircraft price and airline ROI. Spanloaders would have an even lower price and higher ROI but would have a relatively high trip cost because of aerodynamic inefficiencies. Dedicated airfreighters using propfans at Mach 0.8 cruise, laminar flow control, or cryofuels, would not provide any great economic benefits. Air cushion landing gear configurations are identified as an option for avoiding runway constraints on airport requirements and/or operational constraints are noted

Technology requirements and readiness for very large aircraft

Common concerns of very large aircraft in the areas of economics, transportation system interfaces and operational problems were reviewed regarding their influence on vehicle configurations and technology. Fifty-four technology requirements were identified which are judged to be unigue, or particularly critical, to very large aircraft. The requirements were about equally divided among the four general areas of aerodynamics, propulsion and acoustics, structures, and vehicle systems and operations. The state of technology readiness was judged to be poor to fair for slightly more than one-half of the requirements. In the classic disciplinary areas, the state of technology readiness appears to be more advanced than for vehicle systems and operations

Extensive X-ray variability studies of NGC 7314 using long XMM-Newton observations

We present a detailed X-ray variability study of the low mass Active Galactic Nuclei (AGN) NGC 7314 using the two newly obtained XMM-Newton observations ($140$ and $130$ ks), together with two archival data sets of shorter duration ($45$ and $84$ ks). The relationship between the X-ray variability characteristics and other physical source properties (such as the black hole mass) are still relatively poorly defined, especially for low-mass AGN. We perform a new, fully analytical, power spectral density (PSD) model analysis method, which will be described in detail in a forthcoming paper, that takes into consideration the spectral distortions, caused by red-noise leak. We find that the PSD in the $0.5-10$ keV energy range, can be represented by a bending power-law with a bend around $6.7\times10^{-5}$ Hz, having a slope of $0.51$ and $1.99$ below and above the bend, respectively. Adding our bend time-scale estimate, to an already published ensemble of estimates from several AGN, supports the idea that the bend time-scale depends linearly only on the black hole mass and not on the bolometric luminosity. Moreover, we find that as the energy range increases, the PSD normalization increases and there is a hint that simultaneously the high frequency slope becomes steeper. Finally, the X-ray time-lag spectrum of NGC 7314 shows some very weak signatures of relativistic reflection, and the energy resolved time-lag spectrum, for frequencies around $3\times10^{-4}$ Hz, shows no signatures of X-ray reverberation. We show that the previous claim about ks time-delays in this source, is simply an artefact induced by the minuscule number of points entering during the time-lag estimation in the low frequency part of the time-lag spectrum (i.e. below $10^{-4}$ Hz).Comment: Accepted for publication in MNRAS. The paper is 21 pages long and contains 15 figures and 3 table

The Effects of Inhomogeneities on Evaluating the Deceleration Parameter q0_0

Analytic expressions for distance-redshift relations which have been corrected for the effects of some inhomogeneities in the Friedmann-Robertson-Walker (FRW) mass density are used to illustrate the significance of inhomogeneities on a determination of $q_0$ made by using Type Ia supernovae. The value of $q_0$ inferred from a given set of observations depends on the fractional amount of matter in inhomogeneities and is up to 50 percent larger than that obtained by using the standard Mattig $m$-$z$ result for pure dust FRW models.Comment: 16 pages, 7 figures in separate uuencoded fil

Should the FDIC worry about the FHLB? the impact of Federal Home Loan Bank advances on the Bank Insurance Fund

Does growing commercial-bank reliance on Federal Home Loan Bank (FHLBank) advances increase expected losses to the Bank Insurance Fund (BIF)? Our approach to this question begins by modeling the link between advances and expected losses. We then quantify the effect of advances on default probability with a CAMELS-downgrade model. Finally, we assess the impact on loss-given-default by estimating resolution costs in two scenarios: the liquidation of all banks with failure probabilities above two percent and the liquidation of all banks with advance-to-asset ratios above 15 percent. The evidence points to non-trivial increases in expected losses. The policy implication is that the FDIC should price FHLBank-related exposures.Banks and banking ; Financial institutions ; Deposit insurance

Could a CAMELS downgrade model improve off-site surveillance?

The Federal Reserve’s off-site surveillance system includes two econometric models that are collectively known as the System for Estimating Examination Ratings (SEER). One model, the SEER risk rank model, uses the latest financial statements to estimate the probability that each Fed-supervised bank will fail in the next two years. The other component, the SEER rating model, uses the latest financial statements to produce a “shadow” CAMELS rating for each supervised bank. Banks identified as risky by either model receive closer supervisory scrutiny than other state-member banks.> Because many of the banks flagged by the SEER models have already tumbled into poor condition and, hence, would already be receiving considerable supervisory attention, we developed an alternative model to identify safe-and-sound banks that potentially are headed for financial distress. Such a model could help supervisors allocate scarce on- and off-site resources by pointing out banks not currently under scrutiny that need watching.> It is possible, however, that our alternative model improves little over the current SEER framework. All three models—the SEER risk rank model, the SEER rating model, and our downgrade model—produce ordinal rankings based on overall risk. If the financial factors that explain CAMELS downgrades differ little from the financial factors that explain failures or CAMELS ratings, then all three models will produce similar risk ratings and, hence, similar watch lists of one- and two-rated banks.> We find only slight differences in the ability of the three models to spot emerging financial distress among safe-and-sound banks. In out-of-sample tests for 1992 through 1998, the watch lists produced by the downgrade model outperform the watch lists produced by the SEER models by only a small margin. We conclude that, in relatively tranquil banking environments like the 1990s, a downgrade model adds little value in off-site surveillance. We caution, however, that a downgrade model might prove useful in more turbulent banking times.Bank supervision