Monetary Policy, Stock Price Misalignments and Macroeconomic Instability

Perhaps the most fundamental prediction of financial theory is that the expected returns on financial assets are determined by the amount of risk contained in their payoffs. Assets with a riskier payoff pattern should provide higher expected returns than assets that are otherwise similar but provide payoffs that contain less risk. Financial theory also predicts that not all types of risks should be compensated with higher expected returns. It is well-known that the asset-specific risk can be diversified away, whereas the systematic component of risk that affects all assets remains even in large portfolios. Thus, the asset-specific risk that the investor can easily get rid of by diversification should not lead to higher expected returns, and only the shared movement of individual asset returns – the sensitivity of these assets to a set of systematic risk factors – should matter for asset pricing. It is within this framework that this thesis is situated. The first essay proposes a new systematic risk factor, hypothesized to be correlated with changes in investor risk aversion, which manages to explain a large fraction of the return variation in the cross-section of stock returns. The second and third essays investigate the pricing of asset-specific risk, uncorrelated with commonly used risk factors, in the cross-section of stock returns. The three essays mentioned above use stock market data from the U.S. The fourth essay presents a new total return stock market index for the Finnish stock market beginning from the opening of the Helsinki Stock Exchange in 1912 and ending in 1969 when other total return indices become available. Because a total return stock market index for the period prior to 1970 has not been available before, academics and stock market participants have not known the historical return that stock market investors in Finland could have achieved on their investments. The new stock market index presented in essay 4 makes it possible, for the first time, to calculate the historical average return on the Finnish stock market and to conduct further studies that require long time-series of data.

Time misalignments in fault detection and diagnosis

El desalineamiento temporal es la incorrespondencia de dos señales debido a una distorsión en el eje temporal. La Detección y Diagnóstico de Fallas (Fault Detection and Diagnosis-FDD) permite la detección, el diagnóstico y la corrección de fallos en un proceso. La metodología usada en FDD está dividida en dos categorías: técnicas basadas en modelos y no basadas en modelos. Esta tesis doctoral trata sobre el estudio del efecto del desalineamiento temporal en FDD. Nuestra atención se enfoca en el análisis y el diseño de sistemas FDD en caso de problemas de comunicación de datos, como retardos y pérdidas. Se proponen dos técnicas para reducir estos problemas: una basada en programación dinámica y la otra en optimización. Los métodos propuestos han sido validados sobre diferentes sistemas dinámicos: control de posición de un motor de corriente continua, una planta de laboratorio y un problema de sistemas eléctricos conocido como hueco de tensión.

Can misalignments in typical infants be used as a model for infantile esotropia?

PURPOSE. To investigate the nature of early ocular misalignments in human infants to determine whether they can provide insight into the etiology of esotropia and, in particular, to examine the correlates of misalignments. METHODS. A remote haploscopic photorefraction system was used to measure accommodation and vergence in 146 infants between 0 and 12 months of age. Infants underwent photorefraction immediately after watching a target moving between two of five viewing distances (25, 33, 50, 100, and 200 cm). In some instances, infants were tested in two conditions: both eyes open and one eye occluded. The resultant data were screened for instances of large misalignments. Data were assessed to determine whether accommodative, retinal disparity, or other cues were associated with the occurrence of misalignments. RESULTS. The results showed that there was no correlation between accommodative behavior and misalignments. Infants were more likely to show misalignments when retinal disparity cues were removed through occlusion. They were also more likely to show misalignments immediately after the target moved from a near to a far position in comparison to far-to-near target movement. DISCUSSION. The data suggest that the prevalence of misalignments in infants of 2 to 3 months of age is decreased by the addition of retinal disparity cues to the stimulus. In addition, target movement away from the infant increases the prevalence of misalignments. These data are compatible with the notion that misalignment are caused by poor sensitivity to targets moving away from the infant and support the theory that some forms of strabismus could be related to failure in a system that is sensitive to the direction of motion.

Statistical treatment of misalignments in particle accelerators

To know how much misalignment is tolerable for a particle accelerator is an important input for the design of these machines. In particle accelerators the beam must be guided and focused using bending magnets and magnetic lenses, respectively. The alignment of the lenses along a transport line aims to ensure that the beam passes through their optical axes and represents a critical point in the assembly of the machine. There are more and more accelerators in the world, many of which are very small machines. Because the existing literature and programs are mostly targeted for large machines. in this work we describe a method suitable for small machines. This method consists in determining statistically the alignment tolerance in a set of lenses. Differently from the methods used in standard simulation codes for particle accelerators, the statistical method we propose makes it possible to evaluate particle losses as a function of the alignment accuracy of the optical elements in a transport line. Results for 100 key electrons, on the 3.5-m long conforming beam stage of the IFUSP Microtron are presented as an example of use. (C) 2010 Elsevier B.V. All rights reserved.

Real exchange rate misalignments

This paper characterizes episodes of real appreciations and depreciations for a sample of 85 countries, approximately from 1960 to 1998. First, the equilibrium real exchange rate series are constructed for each country using Goldfajn and Valdes (1999) methodology (cointegration with fundamentals). Then, departures from equilibrium real exchange rate (misalignments) are obtained, and a Markov Switching Model is used to characterize the misalignments series as stochastic autoregressive processes governed by two states representing di¤erent means. Three are the main results we …nd: …rst, no evidence of di¤erent regimes for misalignment is found in some countries, second, some countries present one regime of no misalignment (tranquility) and the other regime with misalignment (crisis), and, third, for those countries with two misalignment regimes, the lower mean misalignment regime (appreciated) have higher persistence that the higher mean one (depreciated).

Exchange rate misalignments, interdependence, crises, and currency wars: an empirical assessment

Este trabalho tem por objetivo comparar metodologias distintas para cálculo de desalinhamento cambial além de testar a hipótese se as taxas de câmbio dos diversos países sofrem influencia apenas dos seus próprios fundamentos ou também da taxa de câmbio e dos fundamentos de outros países. Estas hipóteses consistem, respectivamente, na ausência ou na existência de interdependência entre os diversos países. Para realizar tal tarefa utilizam-se duas estratégias empíricas. A primeira baseia-se em avaliar se um modelo multivariado de séries de tempo usualmente utilizada na literatura de desalinhamento cambial com dados apenas do próprio país em análise pode ser melhorado através da adição de variáveis relacionadas a outros países usando o algoritmo proposto por David Hendry e co-autores. A segunda estratégia consiste em estimar um panel longo com as variáveis utilizadas para estimar desalinhamento cambial e testar formalmente a hipótese de ausência de interdependências. Os resultados sugerem que em ambas estratégias existe evidência de existência de interdependência. Esta ocorreria mais por conta de fatores ligados ao curto prazo, ou seja, o que explicaria o valor da taxa de câmbio de um país no longo prazo seriam seus próprios fundamentos enquanto no curto prazo fatores externos poderiam causar desvios

Exchange rate misalignments and international trade policy: impacts on tariffs

The debate on “exchange wars and trade wars” is raising the attention of experts on international trade and economics. The main purpose of this paper is to analyze the impacts of exchange rate misalignments on one of the most traditional trade policy instruments – tariffs, as defined by the WTO – World Trade Organization. It is divided into three sections: the first one examines the effects of exchange rate variations on tariffs and its consequences for the multilateral trade system; the second explains the methodology used to determine exchange rate misalignments and also presents its results for Brazil, US and China; and the third summarizes the methodology applied to calculate the impacts of exchange rate misalignments on the level of tariff protection through an exercise of “misalignment tariffication”

The distortion of currencies misalignments on trade Instruments: or why currencies wars are not over

The negotiations of mega agreements between the US and the Pacific countries (TPP) and between the US and the EU (TTIP) are raising the attention of experts on international trade law and economics. TPP and TTIP are proclaimed to be the designers of the rules for the XXI Century. Old trade instruments such as tariffs are said to be no more important for TTIP because tariffs are negligible among those partners but significant to for TPP. Another relevant agreement in negotiation is between the EU and Mercosul, where tariffs are the most important issue in discussion. The main purpose of this paper is to shows that tariff are important for all these agreements, not because of its nominal value, but because the impacts of exchange rate misalignments on tariffs are so significant that all concessions can be distorted by overvalued and by devaluated currencies. The article is divided into several sections: the first gives an introduction to the issue; the second explains the methodologies used to determine exchange rate misalignments and also presents some results for Brazil, US and China; the third summarizes the methodology applied to calculate the impacts of exchange rate misalignments on the level of tariff protection through an exercise of “misalignment tariffication” and examines the effects of exchange rate variations on tariffs and their consequences for the multilateral trading system; the fourth creates a methodology to estimate exchange rates against a basket of currencies (a virtual currency of the World) and a proposal to deal with persistent and significant misalignments related to trade rules. The fifth presents some estimates for the main PTAs. The conclusions are present in the last section

EU-Mercosur trade relations: impacts of exchange rate misalignments on tariffs

The issue of “trade and exchange rate misalignments” is being discussed at the G20, IMF and WTO, following an initiative by Brazil. The main purpose of this paper is to apply the methodology developed by the authors to exam the impacts of misalignment on tariffs in order to analyse the impacts of misalignments on the trade relations between two customs unions – the EU and Mercosur, as well as to explain how tariff barriers are affected. It is divided into several sections: the first summarises the debate on exchange rates at the WTO; the second explains the methodology used to determine exchange rate misalignments; the third and fourth summarises the methodology applied to calculate the impacts of exchange rate misalignments on the level of tariff protection through an exercise of ‘misalignment tariffication’; the fifth reviews the effects of exchange rate misalignments on tariffs and its consequences for the trade negotiations between the two areas; and the last concludes and suggests a way to move the debate forward in the context of regional arrangements

Trade rules and exchange rate misalignments : in search for a WTO solution e medidas compensatórias

The debate on the link between trade rules and rules on exchange rates is raising the attention of experts on international trade law and economics. The main purpose of this paper is to analyze the impacts of exchange rate misalignments on tariffs as applied by the WTO – World Trade Organization. It is divided into five sections: the first one explains the methodology used to determine exchange rate misalignments and also presents its results for Brazil, US and China; the second summarizes the methodology applied to calculate the impacts of exchange rate misalignments on the level of tariff protection through an exercise of “misalignment tariffication”; the third examines the effects of exchange rate variations on tariffs and their consequences for the multilateral trading system; the fourth one creates a methodology to estimate exchange rates against a currency of the World and a proposal to deal with persistent and significant misalignments related to trade rules. The conclusions are present in the last section

Wearable soft robotic device for post-stroke shoulder rehabilitation: identifying misalignments

Stroke is the leading cause of long-term disability in the United States, affecting over 795,000 people annually. In order to regain motor function of the upper body, patients are usually treated by regular sessions with a dedicated physical therapist. A cost-effective wearable upper body orthotics system that can be used at home to empower both the patients and physical therapists is described. The system is composed of a thin, compliant, lightweight, cost-effective soft orthotic device with an integrated cable actuation system that is worn over the upper body, an embedded limb position sensing system, an electric actuator package and controller. The proposed device is robust to misalignments that may occur during actuation of the compliant brace or when putting on the system. Through simulations and experimental evaluation, it was demonstrated i) that the soft orthotic cable-driven shoulder brace can be successfully actuated without the production of off-axis torques in the presence of misalignments and ii) that the proposed model can identify linear and angular misalignments online.

EU-Mercosur trade relations: impacts of exchange rate misalignments on tariffs. CEPS Working Document No. 372, February 2013

The issue of “trade and exchange rate misalignments” is being discussed at the G20, IMF and WTO, following an initiative by Brazil. The main purpose of this paper is to apply the methodology developed by the authors to exam the impacts of misalignment on tariffs in order to analyse the impacts of misalignments on the trade relations between two customs unions – the EU and Mercosur, as well as to explain how tariff barriers are affected. It is divided into several sections: the first summarises the debate on exchange rates at the WTO; the second explains the methodology used to determine exchange rate misalignments; the third and fourth summarises the methodology applied to calculate the impacts of exchange rate misalignments on the level of tariff protection through an exercise of ‘misalignment tariffication’; the fifth reviews the effects of exchange rate misalignments on tariffs and its consequences for the trade negotiations between the two areas; and the last concludes and suggests a way to move the debate forward in the context of regional arrangements.

Organisational challenges in understanding and implementing effective buiness continuity management strategies in a complex and critical organisation : an airport case study

With the increasing complexity of modern day threats and the growing sophistication of interlinked and interdependent operating environments, Business Continuity Management (BCM) has emerged as a new discipline, offering a strategic approach to safeguarding organisational functions. Of significant interest is the application of BCM frameworks and strategies within critical infrastructure, and in particular the aviation industry. Given the increased focus on security and safety for critical infrastructures, research into the adoption of BCM principles within an airport environment provides valuable management outcomes and research into a previously neglected area of inquisition. This research has used a single case study methodology to identify possible impediments to BCM adoption and implementation by the Brisbane Airport Corporation (BAC). It has identified a number of misalignments between the required breadth of focus for a BCM program, identified differing views on specific roles and responsibilities required during a major disruptive event and illustrated the complexities of the Brisbane Airport which impede the understanding and implementation of effective Business Continuity Management Strategies.

English language study abroad program : an investigation of Hong Kong pre-service teachers’ experiences of a language immersion program

There has been minimal research focused on short-term study abroad language immersion programs, in particular, with home-stay families. The importance of authentic intercultural experience is increasingly clear and was acknowledged as central to the process of language learning (Liddicoat, 2004). In Hong Kong, education programs for pre-service language teachers have significantly emphasised language and intercultural training through short-term study abroad, and these short overseas language immersion courses have become a compulsory component for teacher training (Bodycott & Crew, 2001) in the last decade. This study aims to investigate eight Hong Kong pre-service teachers’ and their home-stay families’ experiences of a short-term (two months) language immersion program in Australia. The focus is on listening to commentaries concerning the development of communicative competence, intercultural competence and professional growth during the out-of-class study abroad experience. The conceptual framework adopted in this study views language and intercultural learning from social constructivist perspectives. Central to this framing is the notion that the internalisation of higher mental functions involves the transfer from the inter-psychological to the intra-psychological plane, that is, a progression process from the socially supported to individually controlled performance. From this perspective, language serves as a way to communicate about, and in relation to, actions and experience. Three research questions were addressed and studied through qualitative methodology. 1. How do the pre-service teachers and their home-stay families perceive the out-of-class component of the program in terms of opportunities for the development of language proficiency and communicative competence? 2. How do the pre-service teachers and their home-stay families perceive the out-of-class component of the program in terms of the development of intercultural competence? 3. How do the pre-service teachers and home-stay families perceive the outof- class component of the program in terms of teachers’ professional growth? Data were generated from multiple data collection methods and analysed through thematic analysis from both a “bottom up” and “top down” approach. The study showed that the pre-service teachers perceived that the immersion program influenced, to varying degrees, their language proficiency, communication and intercultural awareness, as well as their self-awareness and professional growth. These pre-service teachers believed that effective language learning centres on active engagement in the target language community. A mismatch between the views and evaluations of the two groups – the pre-service teachers and the home-stay family members – provides some evidence of misalignments in terms of expectations and perceptions of each other’s roles and responsibilities. The study has highlighted challenges encountered, and provided suggestions for ways of meeting these challenges. The inclusion in the study of the home-stay families’ perceptions and commentaries provided insights, which can inform program development. There is clearly further work to be done in terms of predeparture orientation and preparation, not only for the main participants themselves, the students, but also for the host families.