Energy-to-peak induced norm upper bound control approach for collocated structural systems

2007 ◽  
Author(s):  
Mona Meisami-azad ◽  
Javad Mohammadpour ◽  
Karolos M. Grigoriadis
Keyword(s):  
Upper Bound ◽  
Structural Systems ◽  
Control Approach ◽  
Bound Control

US Financial Debt Crisis: A Stochastic Optimal Control Approach

2011 ◽  
Vol 62 (3) ◽  
Author(s):  
Jerome L. Stein
Keyword(s):  
Optimal Control ◽  
Interest Rate ◽  
Financial Crisis ◽  
Upper Bound ◽  
Stochastic Optimal Control ◽  
Debt Crisis ◽  
Capital Gain ◽  
Empirical Measure ◽  
Net Worth ◽  
Control Approach

SummaryThe financial crisis was precipitated by the mortgage crisis. A whole structure of financial derivatives was based upon the ultimate debtors, the mortgagors. Insofar as the mortgagors were unable to service their debts, the values of the derivatives fell. The financial intermediaries whose assets and liabilities were based upon the value of derivatives were very highly leveraged. Changes in the values of their net worth were large multiples of changes in asset values. A cascade was precipitated by the mortgage defaults. In this manner, the mortgage debt crisis turned into a financial crisis. The crucial variable is the optimal debt of the real estate sector, which depends upon the capital gain and the interest rate. I apply the Stochastic Optimal Control (SOC) analysis to derive the optimal debt. Two models of the stochastic process on the capital gain and interest rate are presented. Each implies a different value of the optimal debt/net worth. I derive an upper bound of the optimal debt ratio, based upon the alternative models. An empirical measure of the excess debt: actual less the upper bound of the optimal ratio, is shown to be an early warning signal (EWS) of the debt crisis.

An H2 Upper Bound Approach for Control of Collocated Structural Systems

2007 ◽  
Author(s):  
Mona Meisami-Azad ◽  
Javad Mohammadpour ◽  
Karolos M. Grigoriadis
Keyword(s):  
Upper Bound ◽  
Structural Systems
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