"Peso Problem" Explanations for Term Structure Anomalies

We examine the empirical evidence on the expectations hypothesis of the term structure of interest rates in the United States, the United Kingdom, and Germany using the Campbell-Shiller (1991) regressions and a vector-autoregressive" methodology. We argue that anomalies in the U.S. term structure, documented by Campbell and Shiller (1991), may be due to a generalized peso problem in which a high-interest rate regime occurred less frequently in the sample of U.S. data than was rationally anticipated. We formalize this idea as a regime-switching model of short-term interest rates estimated with data" from seven countries. Technically, this model extends recent research on regime-switching models with state-dependent transitions to a cross-sectional setting. Use of the small sample distributions generated by the regime-switching model for inference considerably weakens the evidence against the expectations hypothesis, but it remains somewhat implausible that our data-generating process produced the U.S. data. However, a model that combines moderate time-variation in term premiums with peso-problem effects is largely consistent with term structure data from the U.S., U.K., and Germany.

The Implications of First-Order Risk Aversion for Asset Market Risk Premiums

Existing general equilibrium models based on traditional expected utility preferences have been unable to explain the excess return predictability observed in equity markets, bond markets, and foreign exchange markets. In this paper, we abandon the expected-utility hypothesis in favor of preferences that exhibit first-order risk aversion. We incorporate these preferences into a general equilibrium two-country monetary model, solve the model numerically, and compare the quantitative implications of the model to estimates obtained from U.S. and Japanese data for equity, bond and foreign exchange markets. Although increasing the degree of first-order risk aversion substantially increases excess return predictability, the model remains incapable of generating excess return predictability sufficiently large to match the data. We conclude that the observed patterns of excess return predictability are unlikely to be explained purely by time-varying risk premiums generated by highly risk averse agents in a complete markets economy.

"Peso problem" explanations for term structure anomalies

We examine the empirical evidence on the expectation hypothesis of the term structure of interest rates in the United States, the United Kingdom, and Germany using the Campbell-Shiller (1991) regressions and a vector-autoregressive methodology. We argue that anomalies in the U.S. term structure, documented by Campbell and Shiller (1991), may be due to a generalized peso problem in which a high-interest rate regime occurred less frequently in the sample of U.S. data than was rationally anticipated. We formalize this idea as a regime-switching model of short-term interest rates estimated with data from seven countries. Technically, this model extends recent research on regime-switching models with state-dependent transitions to a cross-sectional setting. Use of the small sample distributions generated by regime-switching model for inference considerably weakens the evidence against the expectations hypothesis, but it remains somewhat implausible that our data-generating process produced the U.S. data. However, a model that combines moderate time-variation in term premiums with peso-problem effects is largely consistent with term-structure data from the U.S., U.K., and Germany.Interest rates ; Econometric models

Calculation of Electronic Coupling Matrix Elements for Ground and Excited State Electron Transfer Reactions: Comparison of the Generalized Mulliken–Hush and Block Diagonalization Methods

Two independent methods are presented for the nonperturbative calculation of the electronic coupling matrix element (Hab) for electron transfer reactions using ab initio electronic structure theory. The first is based on the generalized Mulliken–Hush (GMH) model, a multistate generalization of the Mulliken Hush formalism for the electronic coupling. The second is based on the block diagonalization (BD) approach of Cederbaum, Domcke, and co-workers. Detailed quantitative comparisons of the two methods are carried out based on results for (a) several states of the system Zn2OH2+ and (b) the low-lying states of the benzene–Cl atom complex and its contact ion pair. Generally good agreement between the two methods is obtained over a range of geometries. Either method can be applied at an arbitrary nuclear geometry and, as a result, may be used to test the validity of the Condon approximation. Examples of nonmonotonic behavior of the electronic coupling as a function of nuclear coordinates are observed for Zn2OH2+. Both methods also yield a natural definition of the effective distance (rDA) between donor (D) and acceptor (A) sites, in contrast to earlier approaches which required independent estimates of rDA, generally based on molecular structure data

Testing milk by the babcock procedure

The Babcock test for butterfat is the legally recognized standard test for marketing milk and cream in Missouri. It employs the use of sulphuric acid to digest milk solids other than far and to increase the specific gravity of the serum. Far separates and comes to the top of the mixture when the specific gravity of the non-fat portion is increased; the butter fat is melted by heat from acid digestion of milk solids and by centrifugal force. All calibrated glassware used in making the Babcock test must conform to official specifications prescribed in USDA Circular 434, National Bureau of Standards, Testing Volumetric Glassware, 1941, U.S. Government Printing Office, Washington, D. C.Barry J. Steevens (Department of Dairy Husbandry), Robert T. Marshall (Department of Food Science and Nutrition, College of Agriculture)Revised 1/7

Apparatus and Method for Restoring Eyelid Function

An apparatus is provided to restore eyelid function in a patient unable to voluntarily raise an eyelid. The apparatus includes a spiral torsion spring and pulley arrangement mounted in a housing that is implanted in the superior portion of the orbit of the eye. A wire connects the pulley to the eyelid. A spiral torsion spring provides the necessary spring force in tension to overcome the weight of the eyelid and draw the eyelid open. The natural muscles of eye closure are, however, sufficiently strong to overcome the spring tension thereby paying out wire from the pulley and closing the eye so as to provide normal blinking function. A position setting gear allows the biasing force of the spring to be selectively reduced sufficiently to allow the eye to remain closed for sleep or at other desired times. A method of treating ptosis is also disclosed

Regulation of TFIIIB during F9 cell differentiation

<p>Abstract</p> <p>Background</p> <p>Differentiation of F9 embryonal carcinoma (EC) cells into parietal endoderm (PE) provides a tractable model system for studying molecular events during early and inaccessible stages of murine development. PE formation is accompanied by extensive changes in gene expression both in vivo and in culture. One of the most dramatic is the ~10-fold decrease in transcriptional output by RNA polymerase (pol) III. This has been attributed to changes in activity of TFIIIB, a factor that is necessary and sufficient to recruit pol III to promoters. The goal of this study was to identify molecular changes that can account for the low activity of TFIIIB following F9 cell differentiation.</p> <p>Results</p> <p>Three essential subunits of TFIIIB decrease in abundance as F9 cells differentiate; these are Brf1 and Bdp1, which are pol III-specific, and TBP, which is also used by pols I and II. The decreased levels of Brf1 and Bdp1 proteins can be explained by reduced expression of the corresponding mRNAs. However, this is not the case for TBP, which is regulated post-transcriptionally. In proliferating cells, pol III transcription is stimulated by the proto-oncogene product c-Myc and the mitogen-activated protein kinase Erk, both of which bind to TFIIIB. However, c-Myc levels fall during differentiation and Erk becomes inactive through dephosphorylation. The diminished abundance of TFIIIB is therefore likely to be compounded by changes to these positive regulators that are required for its full activity. In addition, PE cells have elevated levels of the retinoblastoma protein RB, which is known to bind and repress TFIIIB.</p> <p>Conclusion</p> <p>The low activity of TFIIIB in PE can be attributed to a combination of changes, any one of which could be sufficient to inhibit pol III transcription. Declining levels of essential TFIIIB subunits and of activators that are required for maximal TFIIIB activity are accompanied by an increase in a potent repressor of TFIIIB. These events provide fail-safe guarantees to ensure that pol III output is appropriate to the diminished metabolic requirements of terminally differentiated cells.</p

Point-by-point inscription of apodized fiber Bragg gratings

We demonstrate apodized fiber Bragg gratings inscribed with a point-by-point technique. We tailor the grating phase and coupling amplitude through precise control over the longitudinal and transverse position of each laser-inscribed modification. This method of apodization is facilitated by the highly-localized, high-contrast modifications generated by focussed IR femtosecond laser inscription. Our technique provides a simple method for the design and implementation of point-by-point fiber Bragg gratings with complex apodization profiles.Comment: 6 pages, 4 figures, article in revie

Using the California mastitis test

"One of the best ways to detect mastitis is to use the California Mastitis Test (CMT). A four-compartment paddle and the CMT reagent are the only supplies you need to conduct the test. Conducting the CMT is simple, but before interpreting the results, you need to know what the test measures."--First page.Robert T. Marshall and J.E. Edmondson (Department of Food Science and Nutrition), and Barry J. Steevens (Department of Dairy Science, College of Agriculture)Revised 11/86/6