Predictability of Returns and Cash Flows

We review the literature on return and cash flow growth predictability form the perspective of the present-value identity. We focus predominantly on recent work. Our emphasis is on U.S. aggregate stock return predictability, but we also discuss evidence from other asset classes and countries

Mortgage Timing

We study how the term structure of interest rates relates to mortgage choice, both at the household and the aggregate level. A simple utility framework of mortgage choice points to the long-term bond risk premium as theoretical determinant: when the bond risk premium is high, fixed-rate mortgage payments are high, making adjustable-rate mortgages more attractive. This long-term bond risk premium is markedly different from other term structure variables that have been proposed, including the yield spread and the long yield. We confirm empirically that the bulk of the time variation in both aggregate and loan-level mortgage choice can be explained by time variation in the bond risk premium. This is true whether bond risk premia are measured using forecasters' data, a VAR term structure model, or from a simple household decision rule based on adaptive expectations. This simple rule moves in lock-step with mortgage choice, lending credibility to a theory of strategic mortgage timing by households

Construction, start-up and operation of a continuously aerated laboratory-scale SHARON reactor in view of coupling with an Anammox reactor

In this study practical experiences during start-up and operation of a laboratory-scale SHARON reactor are discussed, along with the construction of the reactor. Special attention is given to the start-up in view of possible toxic effects of high nitrogen concentrations (up to 4 000 mgN(.)l(-1)) on the nitrifier population and because the reactor was inoculated with sludge from an SBR reactor operated under completely different conditions. Because of these considerations, the reactor was first operated as an SBR to prevent biomass washout and to allow the selection of a strong nitrifying population. A month after the inoculation the reactor was switched to normal chemostat operation. As a result the nitrite oxidisers were washed out and only the ammonium oxidisers persisted in the reactor. In this contribution also some practical considerations concerning the operation of a continuously aerated SHARON reactor, such as mixing, evaporation and wall growth are discussed. These considerations are not trivial, since the reactor will be used for kinetic characterisation and modelling studies. Finally the performance of the SHARON reactor under different conditions is discussed in view of its coupling with an Anammox unit. Full nitrification was proven to be feasible for nitrogen loads up to 1.5 gTAN-N(.)l(-1.)d(-1), indicating the possibility of the SHARON process to treat highly loaded nitrogen streams. Applying different influent concentrations led to different effluent characteristics indicating the need for proper control of the SHARON reactor

Forward Signaling by Unipolar Brush Cells in the Mouse Cerebellum

Unipolar brush cells (UBCs) are glutamatergic interneurons prominently present in the granular layer of the vestibulocerebellum. UBCs engage in extensive synaptic contact with a single presynaptic mossy fiber and signal to downstream granule cells through an elaborate network of mossy fiber-like axons. Ultrastructural examinations and electrophysiological recordings in organotypic slice cultures have indicated that UBCs target not only granule cells but also other UBCs, thus forming chains of two or perhaps more interconnected UBCs. In this report, we show recordings of spontaneous and evoked (di)synaptic events in granule cells and UBCs in fresh cerebellar slices from juvenile mice (5–7 weeks). The patterns of arrival of synaptic events were consistent with the presence of a presynaptic UBC, and recordings from UBCs displayed spontaneous protracted synaptic events characteristic of UBC excitatory synaptic transmission. These results highlight that chains of UBCs could further extend the temporal range of delayed and protracted signaling in the cerebellar cortical network

Health and Mortality Delta: Assessing the Welfare Cost of Household Insurance Choice

We develop a pair of risk measures for the universe of health and longevity products that includes life insurance, annuities, and supplementary health insurance. Health delta measures the differential payoff that a policy delivers in poor health, while mortality delta measures the differential payoff that a policy delivers at death. Optimal portfolio choice simplifies to the problem of choosing a combination of health and longevity products that replicates the optimal exposure to health and mortality delta. For each household in the Health and Retirement Study, we calculate the health and mortality delta implied by its ownership of life insurance, annuities including private pensions, supplementary health insurance, and long-term care insurance. For the median household aged 51 to 58, the lifetime welfare cost of market incompleteness and suboptimal portfolio choice is 28 percent of total wealth

The Cross-Section and Time-Series of Stock and Bond Returns

We propose a three-factor model that jointly prices the cross-section of returns on portfolios of stocks sorted on the book-to-market dimension, the cross-section of government bonds sorted by maturity, and time series variation in expected bond returns. The main insight is that innovations to the nominal bond risk premium price the book-to-market sorted stock portfolios. We argue that these innovations capture business cycle risk and show that dividends of the highest book-to-market portfolio fall substantially more than those of the low book-to-market portfolio during NBER recessions. We propose a structural model that ties together the nominal bond risk premium, the cross-section of book-to-market sorted stock portfolios, and recessions. This model is quantitatively consistent with the observed value, equity, and nominal bond risk premia

Evaluative Conditioning 2.0: Referential versus Intrinsic Learning of Affective Value

Evaluative conditioning is an important determinant of consumers’ likes and dislikes. Three experiments show that it can result from two types of learning. First, stimulus-stimulus (S – S) or referential learning allows a conditioned stimulus (e.g., a brand) to acquire valence by triggering (unconscious) recollections of the unconditioned stimulus (e.g., a pleasant image). Second, stimulus-response (S – R) or intrinsic learning allows a conditioned stimulus to bind directly with the affective response that was previously generated by the unconditioned stimulus. We show when each type of learning occurs and demonstrate the consequences for the robustness of conditioned brand attitudes

Excitation and Excitability of Unipolar Brush Cells

__Abstract__ The cerebellum is a distinct brain structure that ensures the spatial accuracy and temporal coordination of movements. It is located superimposed on the brainstem and has an appearance and organization unlike that of the cerebral cortex: its surface has a highly regular foliation pattern, and its neural circuitry is organized in repeated structured modules. Neural activity enters the cerebellum via two excitatory pathways, the mossy ber system and the climbing ber system. Climbing bers originate from the inferior olivary nucleus in the brainstem, and assert a powerful in uence on cerebellar output and long-term adaptation processes. Mossy bers originate from a large number of sources, and carry contextual information on sensory inputs, aspects of motor planning and commands, and proprioceptive feedback. In the cerebellum this information is evaluated and integrated, to produce neural output that in uences ongoing movement directly. Mossy ber signals are processed in the cerebellum in three stages. In the granular layer, the input stage of the cerebellum, mossy ber signals undergo a recoding step where they are combined and expanded by granule cells. Next, in the molecular layer, granule cell signals are integrated with climbing ber signals in Purkinje cells. Together, the granular la