Description: ongoing discussion of the proper interest rate to use in discounting liability cash flows to reflect credit risk of the insurer in a fair value accounting system

Description: This note is labeled actuarial because it deals extensively with the force of interest, a concept which is characteristically of concern to the actuarial community. The authors’ personal point of view is that we should modify the basic definition of the compound interest.

Description: John Shuttleworth explains why our exam syllabus needs updated and shares examples of inconsistencies in the material and actual financial economics. Edward Friend responds to this article.

Description: Discussion rebutting the Dec. 2004 issue of The Financial Reporter article titled, “On the Fair Value of Insurance Liabilities,” authored by Don Solow. That article expressed disagreement with the position of the International Accounting Standards Board and the Financial Accounting Standards Board to reflect the value of “own credit risk” in the fair valuation of insurance liabilities.

Description: Models are useful in illustrating various facets of complex phenomena, but they are inherently limited.

Description: Editorial that explores how underlying issues of the economic bubble were actuarial in nature.

Description: discussion of an insurance product which ensures the payment of an anticipated tax refund, in order to allow the taxpayer to borrow against that refund to meet liquidity needs.

Description: This is an in-depth look at the root causes of the subprime mortgage crisis and ways actuaries can eliminate the problems. From the Actuary Magazine, April/May 2010 – Volume 7 Issue 2.

Description: Discussion of significant anomalies in option pricing due to the independent identically distributed assumption of the Black Scholes formula.

Description: Summarizes the articles in the newsletter.