Aggregate liquidity shortages, idiosyncracic liquidity smoothing and banking regulation

This paper develops a model of banking fragility driven by aggregate liquidity shortages. Inefficiencies arise because liquidity smoothing across banks breaks down when there is such a shortage, causing unnecessary and value-reducing transfer of assets between banks. We find that a Lender of Last Resort policy is ineffective in restoring efficiency as it leads to offsetting changes in the banks’ supply of liquidity. In contrast, subsidizing the purchase of assets from troubled banks increases welfare by improving the banks’ liquidity holdings. The first best, however, is achieved by redistributing liquidity from healthy to troubled banks in a crisis

Physics Insights from Recent MAGIC AGN Observations

The total set of the 14 active galactic nuclei detected by MAGIC so far includes well-studied bright blazars like Mkn 501, the giant radio galaxy M 87, but also the distant flat-spectrum radio quasar 3C 279, and an intriguing gamma-ray source in the 3C 66A/B region, whose energy spectrum is not compatible with the expectations from 3C 66A. Besides scheduled observations, so far MAGIC succeeded in discovering TeV gamma rays from three blazars following triggers from high optical states. I report selected highlights from recent MAGIC observations of extragalactic TeV gamma-ray sources, emphasizing and discussing the new physics insights the MAGIC observations were able to contribute.Comment: 4 pages, no figures, invited talk at the 2nd Heidelberg workshop: "High-Energy Gamma-rays and Neutrinos from Extra-Galactic Sources", 2009 January, to be published in Int. J. Mod. Phys.

Lyapunov Instability for a hard-disk fluid in equilibrium and nonequilibrium thermostated by deterministic scattering

We compute the full Lyapunov spectra for a hard-disk fluid under temperature gradient and shear. The system is thermalized by deterministic and time-reversible scattering at the boundary. This thermostating mechanism allows for energy fluctuations around a mean value which is reflected by only two vanishing Lyapunov exponents in equilibrium and nonequilibrium. The Lyapunov exponents are calculated with a recently developed formalism for systems with elastic hard collisions. In a nonequilibrium steady state the average phase space volume is contracted onto a fractal attractor leading to a negative sum of Lyapunov exponents. Since the system is driven inhomogeneously we do not expect the conjugate pairing rule to hold which is confirmed numerically.Comment: 13 pages (revtex) with 8 figures (encapsulated postscript

On the Pierce-Birkhoff Conjecture for Smooth Affine Surfaces over Real Closed Fields

We will prove that the Pierce-Birkhoff Conjecture holds for non-singular two-dimensional affine real algebraic varieties over real closed fields, i.e., if W is such a variety, then every piecewise polynomial function on W can be written as suprema of infima of polynomial functions on W. More precisely, we will give a proof of the so-called Connectedness Conjecture for the coordinate rings of such varieties, which implies the Pierce-Birkhoff Conjecture.Comment: v2: Removed typos, changed content. v3: Added missing conditions for several results in section

Generalised model-independent characterisation of strong gravitational lenses IV: formalism-intrinsic degeneracies

Based on the standard gravitational lensing formalism with its effective, projected lensing potential in a given background cosmology, we investigate under which transformations of the source position and of the deflection angle the observable properties of the multiple images, i.e. the time delay differences, the relative image positions, relative shapes, and magnification ratios, remain invariant. As these observables only constrain local lens properties, we derive general, local invariance transformations in the areas covered by the multiple images. We show that the known global invariance transformations, e.g. the mass sheet transformation or the source position transformation, are contained in our invariance transformations, when they are restricted to the areas covered by the multiple images and when lens-model-based degeneracies are ignored, like the freedom to add or subtract masses in unconstrained regions without multiple images. Hence, we have identified the general class of invariance transformations that can occur, in particular in our model-independent local characterisation of strong gravitational lenses.Comment: 10 pages, 4 figures, in press in A&A, comments very welcome (update to accepted and improved version