Hedging private international real estate

The performance of an international real estate investment can be critically affected by currency fluctuations. While survey work suggests large international investors with multi-asset portfolios tend to hedge their overall currency exposure at portfolio level, smaller and specialist investors are more likely to hedge individual investments and face considerable specific risk. This presents particular problems in direct real estate investment due to the lengthy holding period. Prior research investigating the issue relies on ex post portfolio measure, understating the risk faced. This paper examines individual risk using a forward-looking simulation approach to model uncertain cashflow. The results suggest that a US investor can greatly reduce the downside currency risk inherent in UK real estate by using a swap structure – but at the expense of dampening upside potential.

A model for exchange rates with crawling bands: an application to the Colombian peso

This paper builds upon previous research on currency bands, and provides a model for the Colombian peso. Stochastic differential equations are combined with information related to the Colombian currency band to estimate competing models of the behaviour of the Colombian peso within the limits of the currency band. The resulting moments of the density function for the simulated returns describe adequately most of the characteristics of the sample returns data. The factor included to account for the intra-marginal intervention performed to drive the rate towards the Central Parity accounts only for 6.5% of the daily change, which supports the argument that intervention, if performed by the Central Bank, it is not directed to push the currency towards the limits. Moreover, the credibility of the Colombian Central Bank, Banco de la República’s ability to defend the band seems low.

Testing for non-stationarity and cointegration allowing for the possibility of a structural break: an application to EuroSterling interest rates

In this paper we examine the order of integration of EuroSterling interest rates by employing techniques that can allow for a structural break under the null and/or alternative hypothesis of the unit-root tests. In light of these results, we investigate the cointegrating relationship implied by the single, linear expectations hypothesis of the term structure of interest rates employing two techniques, one of which allows for the possibility of a break in the mean of the cointegrating relationship. The aim of the paper is to investigate whether or not the interest rate series can be viewed as I(1) processes and furthermore, to consider whether there has been a structural break in the series. We also determine whether, if we allow for a break in the cointegration analysis, the results are consistent with those obtained when a break is not allowed for. The main results reported in this paper support the conjecture that the ‘short’ Euro-currency rates are characterised as I(1) series that exhibit a structural break on or near Black Wednesday, 16 September 1992, whereas the ‘long’ rates are I(1) series that do not support the presence of a structural break. The evidence from the cointegration analysis suggests that tests of the expectations hypothesis based on data sets that include the ERM crisis period, or a period that includes a structural break, might be problematic if the structural break is not explicitly taken into account in the testing framework.

Continental shift? An analysis of convergence trends in European real estate equities

European economic and political integration have been recognised as having implications for patterns of performance in national real estate and capital markets and have generated a wide body of research and commentary. In 1999, progress towards monetary integration within the European Union culminated in the introduction of a common currency and monetary policy. This paper investigates the effects of this ‘event’ on the behaviour of stock returns in European real estate companies. A range of statistical tests is applied to the performance of European property companies to test for changes in segmentation, co-movement and causality. The results suggest that, relative to the wider equity markets, the dispersion of performance is higher, correlations are lower, a common contemporaneous factor has much lower explanatory power whilst lead-lag relationships are stronger. Consequently, the evidence of transmission of monetary integration to real estate securities is less noticeable than to general securities. Less and slower integration is attributed to the relatively small size of the real estate securities market and the local and national nature of the majority of the companies’ portfolios.

xero, kline & coma

xero, kline & coma is an artist run project space at 258 Hackney Road, London. It’s program, curated by Pil and Galia Kollectiv, focuses primarily on solo exhibitions by internationally established as well as emerging artists. Work by recent graduates King Conny Wobble and David Steans is being shown alongside projects like the Museum of American Art – Berlin, previously included in the Venice and Istanbul Biennales, Jeffrey Vallance, whose recent solo exhibition was at the Warhol Museum, and Plastique Fantastique, whose work has been shown at Tate Britain and the Pratt Manhatten Gallery, New York, with the aim of raising the profile of lesser known artists and allowing others to experiment with work that more institutional contexts don’t always permit. Some of the themes this program has explored have included fictional identities, a-chronological art histories and the mediation of ritual in time-based media. A commitment to critically engaged art is also central to the ethos of the space, and future shows include an exploration of unionism in art by Sophie Carapetian. As well as displaying new work, the gallery hosts events, talks and screenings. Most recently these have included meetings of the Political Currency of Art research group, a discussion and film screening dealing with the theme of ‘hostile objects’ led by Evan Calder Williams and Marina Vishmidt, a book launch for New Lines of Alliance, New Spaces of Liberty by Antonio Negri and Felix Guattari and an event dedicated to the theatre work of Slovenian art collective NSK, featuring a screening of unreleased documentation and a discussion about the future of total performance.

Future Monument

Based on a series of collage made from images of mega yachts, the Future Monument looks at the possibility of taking late capitalism more seriously as an ideology than it takes itself seriously. The project asks whether the private display of wealth and power represented by the yacht can be appropriated for a new language of public sculpture. The choreographed live performance of the construction of the large scale monument was scripted to a proposed capitalist manifesto and took place in a public square in Herzliya, Israel. It aimed to articulate the ideology latent in capitalism’s claims to a neutral manifestation of human nature. The Future Monument project was developed through reading seminars taking place at Goldsmiths College, as part of a research strand headed by Pil and Galia Kollectiv on irony and overidentification within the Political Currency of Art research group. This research has so far produced a series of silk screen collage prints, a sculpture commissioned by the Essex Council and a live performance commissioned by the Herzliya Biennale. However, the project is ongoing, with future outputs planned including a curated exhibition and conference in 2012, in collaboration with Matthew Poole, Programme Director of the Centre for Curatorial Studies at the University of Essex.

Safeguarding livelihoods or exacerbating poverty?: Artisanal mining and formalization in West Africa

In recent years, policy mechanisms to support a formalized artisanal and small-scale mining (ASM) sector in sub-Saharan Africa have gained increasing currency. Proponents of formalization argue that most social and environmental problems associated with the sector stem from the fact that ASM is predominantly unregulated and operates outside the legal sphere. This paper critically examines recent efforts to formalize artisanal and small-scale mining inWest Africa, drawing upon recent fieldwork carried out in Sierra Leone, Ghana and Mali. In exploring the sector’s livelihood dimensions, the analysis suggests that bringing unregulated, informal mining activities into the legal domain remains a considerable challenge. The paper concludes by confirming the urgent need to refocus formalization strategies on the main livelihood challenges and constraints of small-scale miners themselves, if poverty is to be alleviated and more benefits are to accrue to depressed communities in mineral-rich regions.

The risks of investing in the real estate markets of the asian region

The Asian region has become a focus of attention for investors in recent years. Due to the strong economic performance of the region, the higher expected returns in the area compared with Europe and the USA and the additional diversification benefits investment in the region would offer. Nonetheless many investors have doubts about the prudence of investing in such areas. In particular it may be felt that the expected returns offered in the countries of the Asian region are not sufficient to compensate investors for the increased risks of investing in such markets. These risks can be categorised into under four headings: investment risk, currency risk, political risk, and institutional risk. This paper analyses each of these risks in turn to see if they are sufficiently large to deter real estate investment in the region in general or in a particular country.

Macro-economic and financial determinants of comovement across global real estate security markets

This paper models the determinants of integration in the context of global real estate security markets. Using both local and U.S. Dollar denominated returns, we model conditional correlations across listed real estate sectors and also with the global stock market. The empirical results find that financial factors, such as the relationship with the respective equity market, volatility, the relative size of the real estate sector and trading turnover all play an important role in the degree of integration present. Furthermore, the results highlight the importance of macro-economic variables in the degree of integration present. All four of the macro-economic variables modeled provide at least one significant result across the specifications estimated. Factors such as financial and trade openness, monetary independence and the stability of a country’s currency all contribute to the degree of integration reported.

Being and goodness

The old scholastic principle of the "convertibility" of being and goodness strikes nearly all moderns as either barely comprehensible or plain false. "Convertible" is a term of art meaning "interchangeable" in respect of predication, where the predicates can be exchanged salva veritate albeit not salva sensu: their referents are, as the maxim goes, really the same albeit conceptually different. The principle seems, at first blush, absurd. Did the scholastics literally mean that every being is good? Is that supposed to include a cancer, a malaria parasite, an earthquake that kills millions? If every being is good, then no being is bad—but how can that be? To the contemporary philosophical mind, such bafflement is understandable. It derives from the systematic dismantling of the great scholastic edifice that took place over half a millennium. With the loss of the basic concepts out of which that edifice was built, the space created by those concepts faded out of existence as well. The convertibility principle, like virtually all the other scholastic principles (not all, since some do survive and thrive in analytic philosophy), could not persist in a post-scholastic space wholly alien to it.

Bank integration and co-movements across housing markets

This paper investigates whether bank integration measured by cross-border bank flows can capture the co-movements across housing markets in developed countries by using a spatial dynamic panel model. The transmission can occur through a global banking channel in which global banks intermediate wholesale funding to local banks. Changes in financial conditions are passed across borders through the banks’ balance-sheet exposure to credit, currency, maturity, and funding risks resulting in house price spillovers. While controlling for country-level and global factors, we find significant co-movement across housing markets of countries with proportionally high bank integration. Bank integration can better capture house price co-movements than other measures of economic integration. Once we account for bank exposure, other spatial linkages traditionally used to account for return co-movements across region – such as trade, foreign direct investment, portfolio investment, geographic proximity, etc. – become insignificant. Moreover, we find that the co-movement across housing markets decreases for countries with less developed mortgage markets characterized by fixed mortgage rate contracts, low limits of loan-to-value ratios and no mortgage equity withdrawal.

Assessment for Learning in teaching English to Young Learners: teachers’ understanding, classroom practice and impact on interactions

It has been suggested that Assessment for Learning (AfL) plays a significant role in enhancing teaching and learning in mainstream educational contexts. However, little empirical evidence can support these claims. As AfL has been shown to be enacted predominantly through interactions in primary classes, there is a need to understand if it is appropriate, whether it can be efficiently used in teaching English to Young Learners (TEYL) and how it can facilitate learning in such a context. This emerging research focus gains currency especially in the light of SLA research, which suggests the important role of interactions in foreign language learning. This mixed-method, descriptive and exploratory study aims to investigate how teachers of learners aged 7-11 understand AfL; how they implement it; and the impact that such implementation could have on interactions which occur during lessons. The data were collected through lesson observations, scrutiny of school documents, semi-structured interviews and a focus group interview with teachers. The findings indicate that fitness for purpose guides the implementation of AfL in TEYL classrooms. Significantly, the study has revealed differences in the implementation of AfL between classes of 7-9 and 10-11 year olds within each of the three purposes (setting objectives and expectations; monitoring performance; and checking achievement) identified through the data. Another important finding of this study is the empirical evidence suggesting that the use of AfL could facilitate creating conditions conducive to learning in TEYL classes during collaborative and expert/novice interactions. The findings suggest that teachers’ understanding of AfL is largely aligned with the theoretical frameworks (Black & Wiliam, 2009; Swaffield, 2011) already available. However, they also demonstrate that there are TEYL specific characteristics. This research has important pedagogical implications and indicates a number of areas for further research.

Echoes of 1992: the NAFTA negotiations and North America now

Two decades ago, Canada, Mexico, and the United States created a continental economy. The road to integration from the signing of the North American Free Trade Agreement has not been a smooth one. Along the way, Mexico lived through a currency crisis, a democratic transition, and the rising challenge of Asian manufacturing. Canada stayed united despite surging Quebecois nationalism during the 1990s; since then, it has seen dramatic economic changes with the explosion of hydrocarbon production and a much stronger currency. The United States saw a stock-market bust, the shock of 9/11, and the near-collapse of its financial system. All of these events have transformed the relationships that emerged after NAFTA entered into force in 1994. Given the tremendous changes, one might be skeptical that the circumstances and details of the negotiation and ratification of NAFTA hold lessons for the future of North America. However, the road to NAFTA had its own difficulties, and many of the issues involved in the negotiations underpin today's challenges. NAFTA was conceived at a time of profound change in the international system. When Mexican leaders surveyed the world two decades ago, they saw emerging regional groupings in Europe, Asia, and South America. Faced with a lack of interest or compatibility, they instead doubled down on North America. How did Mexican leaders reconsider their national interests and redefine Mexico's role in the world in light of those transformations? Unpublished Mexican documents from SECOFI, the secretariate most involved in negotiating NAFTA, help illustrate Mexican thinking about its interests and role at that time. Combining those insights with analysis of newly available evidence from U.S. presidential archives, this paper sheds light on the negotiations that concluded two decades ago.

A new regime of carbon counting: the practices and politics of accounting for everyday carbon through C02e

Inspired by the commercial desires of global brands and retailers to access the lucrative green consumer market, carbon is increasingly being counted and made knowable at the mundane sites of everyday production and consumption, from the carbon footprint of a plastic kitchen fork to that of an online bank account. Despite the challenges of counting and making commensurable the global warming impact of a myriad of biophysical and societal activities, this desire to communicate a product or service's carbon footprint has sparked complicated carbon calculative practices and enrolled actors at literally every node of multi-scaled and vastly complex global supply chains. Against this landscape, this paper critically analyzes the counting practices that create the ‘e’ in ‘CO2e’. It is shown that, central to these practices are a series of tools, models and databases which, in building upon previous work (Eden, 2012 and Star and Griesemer, 1989) we conceptualize here as ‘boundary objects’. By enrolling everyday actors from farmers to consumers, these objects abstract and stabilize greenhouse gas emissions from their messy material and social contexts into units of CO2e which can then be translated along a product's supply chain, thereby establishing a new currency of ‘everyday supply chain carbon’. However, in making all greenhouse gas-related practices commensurable and in enrolling and stabilizing the transfer of information between multiple actors these objects oversee a process of simplification reliant upon, and subject to, a multiplicity of approximations, assumptions, errors, discrepancies and/or omissions. Further the outcomes of these tools are subject to the politicized and commercial agendas of the worlds they attempt to link, with each boundary actor inscribing different meanings to a product's carbon footprint in accordance with their specific subjectivities, commercial desires and epistemic framings. It is therefore shown that how a boundary object transforms greenhouse gas emissions into units of CO2e, is the outcome of distinct ideologies regarding ‘what’ a product's carbon footprint is and how it should be made legible. These politicized decisions, in turn, inform specific reduction activities and ultimately advance distinct, specific and increasingly durable transition pathways to a low carbon society.