Paris Princeton Lectures on Mathematical Finance 2003 The Paris Princeton Lectures in Financial Mathematics of which this is the second volume will on an annual basis publish cutting edge research in self contained expository articles from outstanding established or upcoming! specialists. The aim is to produce a series of articles that can serve as an introductory reference for research in the field. It arises as a result of frequent exchanges between the finance and financial mathematics groups in Paris and Princeton. This volume presents the following articles: Hedging of Defaultable Claims by T. Bielecki M. Jeanblanc and M. Rutkowski; On the Geometry of Interest Rate Models by T. Björk; Heterogeneous Beliefs Speculation and Trading in Financial Markets by J.A. Scheinkman and W. Xiong. T. Bielecki M. Jeanblanc Marek Rutkowski: Hedging of Defaultable Claims T. Björk: On the Geometry of Interest Rate Models J.A. Scheinkman W. Xiong: Heterogeneous Beliefs Speculation and Trading in Financial Markets.