The rationale for a safe asset and fiscal capacity for the Eurozone. LEQS Paper No. 144/2019 May 2019

The only way to share common liabilities in the Eurozone is to achieve full fiscal and political union, i.e. unity of liability and control. In the pursuit of that goal, there is a need to smooth the transition, avoid unnecessary strains to macroeconomic and financial stability and lighten the burden of stabilisation policies from national sovereigns and the European Central Bank, while preserving market discipline and avoiding moral hazard. Both fiscal and monetary policy face constraints linked to the high legacy debt in some countries and the zero-lower-bound, respectively, and thus introducing Eurozone ‘safe assets’ and fiscal capacity at the centre would strengthen the transmission of monetary and fiscal policies. The paper introduces a standard Mundell-Fleming framework adapted to the features of a closed monetary union, with a two-country setting comprising a ‘core’ and a ‘periphery’ country, to evaluate the response of policy and the economy in case of symmetric and asymmetric demand and supply shocks in the current situation and following the introduction of safe bonds and fiscal capacity. Under the specified assumptions, it concludes that a safe asset and fiscal capacity, better if in combination, would remove the doom loop between banks and sovereigns, reduce the loss in output for both economies and improve the stabilisation properties of fiscal policy for both countries, and thus is welfare enhancing

Some comments on a recently derived approximated solution of the Einstein equations for a spinning body with negligible mass

Recently, an approximated solution of the Einstein equations for a rotating body whose mass effects are negligible with respect to the rotational ones has been derived by Tartaglia. At first sight, it seems to be interesting because both external and internal metric tensors have been consistently found, together an appropriate source tensor; moreover, it may suggest possible experimental checks since the conditions of validity of the considered metric are well satisfied at Earth laboratory scales. However, it should be pointed out that reasonable doubts exist if it is physically meaningful because it is not clear if the source tensor related to the adopted metric can be realized by any real extended body. Here we derive the geodesic equations of the metric and analyze the allowed motions in order to disclose possible unphysical features which may help in shedding further light on the real nature of such approximated solution of the Einstein equations.Comment: Latex2e, 17 pages, no tables, 5 figures, minor typos corrected. To appear in general Relativity and Gravitatio

Orbital effects of Lorentz-violating Standard Model Extension gravitomagnetism around a static body: a sensitivity analysis

We analytically work out the long-term rates of change of the six osculating Keplerian orbital elements of a test particle acted upon by the Lorentz-violating gravitomagnetic acceleration due to a static body, as predicted by the Standard Model Extension (SME). We neither restrict to any specific spatial orientation for the symmetry-violating vector s nor make a priori simplifying assumptions concerning the orbital configuration of the perturbed test particle. Thus, our results are quite general, and can be applied for sensitivity analyses to a variety of specific astronomical and astrophysical scenarios. We find that, apart from the semimajor axis a, all the other orbital elements undergo non-vanishing secular variations. By comparing our results to the latest determinations of the supplementary advances of the perihelia of some planets of the solar system we preliminarily obtain s_x = (0.9 +/- 1.5) 10^-8, s_y = (-4 +/- 6) 10^-9, s_z = (0.3 +/- 1) 10^-9. Bounds from the terrestrial LAGEOS and LAGEOS II satellites are of the order of s\sim 10^-3-10^-4.Comment: LaTex2e, 9 pages, no figures, 3 tables, 25 references. Typos fixe

Space-time decay of Navier-Stokes flows invariant under rotations

We show that the solutions to the non-stationary Navier-Stokes equations in $R^d$, $d=2,3$ which are left invariant under the action of discrete subgroups of the orthogonal group $O(d)$ decay much faster as $|x|\to\infty$ or $t \to\infty$ than in the generic case and we compute, for each subgroup, the precise decay rates in space-time of the velocity field