“Does the tail wag the dog? The effect of credit default swaps on credit risk”

Credit default swaps (CDS) are derivative contracts that are widely used as tools for credit risk management. However, in recent years, concerns have been raised about whether CDS trading itself affects the credit risk of the reference entities. We use a unique, comprehensive sample covering CDS trading of 901 North American corporate issuers, between June 1997 and April 2009, to address this question. We find that the probability of both a credit rating downgrade and bankruptcy increase, with large economic magnitudes, after the inception of CDS trading. This finding is robust to controlling for the endogeneity of CDS trading. Beyond the CDS introduction effect, we show that firms with relatively larger amounts of CDS contracts outstanding, and those with relatively more “no restructuring” contracts than other types of CDS contracts covering restructuring, are more adversely affected by CDS trading. Moreover, the number of creditors increases after CDS trading begins, exacerbating creditor coordination failure for the resolution of financial distress

How accurate is your sclerostin measurement?:Comparison between three commercially available sclerostin ELISA kits

Sclerostin, bone formation antagonist is in the spotlight as a potential biomarker for diseases presenting with associated bone disorders such as chronic kidney disease (CDK-MBD). Accurate measurement of sclerostin is therefore important. Several immunoassays are available to measure sclerostin in serum and plasma. We compared the performance of three commercial ELISA kits. We measured sclerostin concentrations in serum and EDTA plasma obtained from healthy young (18-26 years) human subjects using kits from Biomedica, TECOmedical and from R&D Systems. The circulating sclerostin concentrations were systematically higher when measured with the Biomedica assay (serum: 35.5 ± 1.1 pmol/L; EDTA: 39.4 ± 2.0 pmol/L; mean ± SD) as compared with TECOmedical (serum: 21.8 ± 0.7 pmol/L; EDTA: 27.2 ± 1.3 pmol/L) and R&D Systems (serum: 7.6 ± 0.3 pmol/L; EDTA: 30.9 ± 1.5 pmol/L). We found a good correlation between the assay for EDTA plasma (r > 0.6; p < 0.001) while in serum, only measurements obtained using TECOmedical and R&D Systems assays correlated significantly (r = 0.78; p < 0.001). There was no correlation between matrices results when using the Biomedica kit (r = 0.20). The variability in values generated from Biomedica, R&D Systems and TECOmedical assays raises questions regarding the accuracy and specificity of the assays. Direct comparison of studies using different kits is not possible and great care should be given to measurement of sclerostin, with traceability of reagents. Standardization with appropriate material is required before different sclerostin assays can be introduced in clinical practice

STAT3 Genotypic Variant rs744166 and Increased Tyrosine Phosphorylation of STAT3 in IL-23 Responsive Innate Lymphoid Cells during Pathogenesis of Crohn\u27s Disease

Crohn\u27s disease (CD) results from dysregulated immune responses to gut microbiota in genetically susceptible individuals, affecting multiple areas of the gastrointestinal tract. Innate lymphoid cells (ILCs) are tissue-resident innate effector lymphocytes which play crucial roles in mucosal immune defense, tissue repair, and maintenance of homeostasis. The accumulation of IFN-γ-producing ILC1s and increased level of proinflammatory cytokines produced by ILCs has been observed in the inflamed terminal ileum of CD patients. To date, the precise mechanisms of ILC plasticity and gene regulatory pathways in ILCs remain unclear. Signal transducer and activator of transcription 3 (STAT3) regulates gene expression in a cell-specific, cytokine-dependent manner, involving multiple immune responses. This study proposes the positive correlation between the prevalence of STAT3 rs744166 risky allele A with the severity of disease in a cohort of 94 CD patients. In addition, the results suggest an increased STAT3 activity in the inflamed ileum of CD patients, compared to unaffected ileum sections. Notably, IL-23 triggers the differentiation of CD117+NKp44- ILC3s and induces the activation of STAT3 in both CD117+NKp44- and CD117-NKp44- ILC subsets, implying the involvement of STAT3 in the initiation of ILC plasticity. Moreover, carriage of STAT3 A risk allele exhibited a higher basal level of STAT3 tyrosine phosphorylation, and an increased IL-23 triggered the pSTAT3 level. We also demonstrated that there was no delayed dephosphorylation of STAT3 in ILCs of both A/A and G/G donors. Overall, the results of this study suggest that IL-23-induced activation of STAT3 in the CD117-NKp44- ILC1s involves in ILC1-to-ILC3 plasticity and a potential regulatory role of ILC1 function. Those genetically susceptible individuals carried STAT3 rs744166 risky allele appear to have higher basal and cytokine-stimulated activation of STAT3 signal, leading to prolonged inflammation and chronic relapse

Trading incentives to meet the analyst forecast

We examine stock sales as a managerial incentive to help explain the discontinuity around the analyst forecast benchmark. We find that the likelihood of just meeting versus just missing the analyst forecast is strongly associated with subsequent managerial stock sales. Moreover, we provide evidence that managers manage earnings prior to just meeting the threshold and selling their shares. Finally, the relation between just meeting and subsequently selling shares does not hold for non-manager insiders, who arguably cannot affect the earnings outcome, and is weaker in the presence of an independent board, suggesting that good corporate governance mitigates this strategic behavior

Experimental quantum key distribution with source flaws

Decoy-state quantum key distribution (QKD) is a standard technique in current quantum cryptographic implementations. Unfortunately, existing experiments have two important drawbacks: the state preparation is assumed to be perfect without errors and the employed security proofs do not fully consider the finite-key effects for general attacks. These two drawbacks mean that existing experiments are not guaranteed to be secure in practice. Here, we perform an experiment that for the first time shows secure QKD with imperfect state preparations over long distances and achieves rigorous finite-key security bounds for decoy-state QKD against coherent attacks in the universally composable framework. We quantify the source flaws experimentally and demonstrate a QKD implementation that is tolerant to channel loss despite the source flaws. Our implementation considers more real-world problems than most previous experiments and our theory can be applied to general QKD systems. These features constitute a step towards secure QKD with imperfect devices.Comment: 12 pages, 4 figures, updated experiment and theor

Restraint-induced Corticosterone Secretion and Hypothalamic CRH mRNA Expression are Augmented During Acute Withdrawal from Chronic Cocaine Administration

Stress responses during cocaine withdrawal likely contribute to drug relapse and may be intensified as a consequence of prior cocaine use. The present study examined changes in stressor-induced activation of the hypothalamic–pituitary–adrenal (HPA) axis during acute withdrawal from chronic cocaine administration. Adult male Sprague–Dawley rats received daily administration of cocaine (30 mg/kg, i.p.) or saline for 14 days. Twenty-four hours after the last injection, rats in each group were sacrificed under stress-free conditions or following 30 min of immobilization. Plasma corticosterone (CORT) was measured in trunk-blood using radioimmunoassay, corticotropin-releasing hormone (CRH) mRNA levels in the paraventricularnucleus (PVN) of the hypothalamus were measured using in situ hybridization and glucocorticoid receptor (GR) protein expression in the pituitary gland and dissected brain regions was measured using Western blot analysis. Basal CRH mRNA in the PVN was unaltered as a result of prior cocaine administration. However, a significant increase in CRH mRNA was observed 90 min following the termination of restraint in cocaine withdrawn, but not saline-treated, rats. Basal CORT was also unaffected by prior cocaine administration, but the CORT response measured immediately after restraint was significantly augmented in cocaine-withdrawn rats. Differences in GR protein expression in number of regions implicated in negative feedback regulation of HPA function, including the hypothalamus, were not observed. These findings indicate that the HPA response to stressors is intensified during early withdrawal from cocaine administration and may be independent of changes in GR-mediated negative feedback