Sunday reading

This is pretty neat. This research paper hit the arXiv earlier this week:

_Analysis of a network structure of the foreign currency exchange market

We analyze structure of the world foreign currency exchange (FX) market viewed as a network of interacting currencies. We analyze daily time series of FX data for a set of 63 currencies, including gold, silver and platinum. We group together all the exchange rates with a common base currency and study each group separately. By applying the methods of filtered correlation matrix we identify clusters of closely related currencies. _The clusters are formed typically according to the economical and geographical factors._

We also study topology of weighted minimal spanning trees for different network representations (i.e., for different base currencies) and find that in a majority of representations the network has a hierarchical scale-free structure. In addition, we analyze the temporal evolution of the network and detect that its structure is not stable over time._

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_Here’s the paydirt. The conclusion sounds a bit “well, duh” on the face of it, but it’s interesting to see some empirical evidence for the trend:

**_A medium-term trend can be identified which affects the USD node by decreasing its centrality. Our analysis shows also an increasing role of euro in the world’s currency market.

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And if you’d like some more light reading, here’s one from the High Energy Physics section: Physical interpretation for Riemann zeros from black hole physics:

According to a conjecture attributed to Poyla and Hilbert, there is a self-adjoint operator whose eigenvalues are the the nontrivial zeros of the Riemann zeta function. We show that the near-horizon dynamics of a massive scalar field in the Schwarzschild black hole spacetime, under a reasonable boundary condition, gives rise to energy eigenvalues that coincide with the Riemann zeros.

Alrighty then!