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New Orleans Magistrates Get a Cut of Fines and Bail Money, and That’s a Problem

New Orleans magistrates who fund their own courts using a cut of the fines and bail they order defendants to pay have a financial conflict of interest and violate defendants’ due process rights, the 5th U.S. Circuit Court of Appeals ruled in not one, but two federal court cases. These decisions follow a pair of federal rulings from a year ago in which two judges for the U.S. District Court for the Eastern District of Louisiana ordered New Orleans magistrates to stop jailing defendants who couldn’t afford to pay fees or up-front bail costs.

Orleans Parish Magistrate Henry Cantrell was accused of typically setting a minimum bail of $2,500 for defendants and threatening defense attorneys who sought bail reductions. One defendant sat in jail for two weeks trying to collect the money. A second defendant was unable to pay bail and stayed in jail for more than a month before being freed. It just so happened that Cantrell’s court got a chunk of any fines and bail money it collected. The court used that money to fund its operations.

Last year, Cantrell told the federal courts he had changed these practices and was no longer simply demanding large bail amounts that defendants couldn’t pay. But he also appealed last year’s rulings, asking the 5th U.S. Circuit Court of Appeals to rule that setting the bail amounts and also funding the court with bail proceeds did not violate the due process rights of defendants.

On Thursday, a three-judge panel on the 5th U.S. Circuit Court of Appeals flatly rejected Cantrell’s request. In a 14-page ruling, the judges explained that if a magistrate needs bail money to fund court systems, he is incentivized to extract bail money from defendants. While Cantrell didn’t pocket the money himself, these bail bonds paid for up to a quarter of some courts’ budgets. Judge Gregg Costa wrote Thursday’s decision affirming the lower court’s ruling on bail: “Judge Cantrell has a direct and personal interest in the fiscal health of the public institution that benefits from the fees his court generates and that he also helps allocate.”

This ruling focused specifically on the magistrates’ demands of cash bail and their financial stake in making people pay. Last Friday, a separate 5th Circuit panel ruled that these same magistrates also have a conflict of interest when determining whether a defendant can afford to pay the fines and fees. That decision noted that when the collection of fines and fees goes down, it directly impacts the courts’ operations, causing cuts in services and salaries. The magistrates then respond by trying to increase the collection of fines and fees to keep the courts operating.

Essentially, New Orleans funding its courts on the backs of the defendants that appear before that court is a huge problem. If the courts don’t get money from the defendants, it won’t be able to function. Costa bluntly notes toward the end of his ruling that the obvious solution to the conflict of interest is to not send these fees directly to the Judicial Expense Fund. Louisiana state law does not require the courts to be funded in this fashion. He concludes:

“[I]t may well turn out that the only way to eliminate the unconstitutional temptation is to sever the direct link between the money the criminal court generates and the Judicial Expense Fund that supports its operations.”

Read yesterday’s ruling here and last week’s ruling here. Read more here about the financial struggles facing the New Orleans courts due to their dependence on fines and fees to pay for operations.

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The Global Credit Impulse Is Giving Signs Of Life

Submitted by Christopher Dembik, head of macro analysis at Saxo Bank

Based on preliminary data, global credit impulse – the second derivative of global credit growth and a major driver of economic activity – is giving signs of life. It is still in contraction, at minus 3.8% of GDP, but slowly moving upwards. Currently, more than half of the countries in our sample, representing 69.4% of global GDP, have experienced an acceleration in credit impulse over the past quarter.

The improvement in global credit impulse is mostly due to slightly better China credit impulse and strong credit push in the United States.

China is trying to reverse measures taken over previous years that reduced liquidity and credit flow, especially from small banks. China credit impulse, which is the main contributor to global credit impulse (1/3 of the total pulse), is still in contraction at minus 3.8% of GDP but moving upwards. We expect the trend will continue in coming quarters to offset economic deceleration due to weak demand and impact of trade war.
The new easing cycle starts to have an impact in DM countries. The United States has opened the credit tap again with credit impulse standing at 1.2% of GDP, the highest level since early 2018. The positive trend is also visible in demand for C&I loans which has been solid over the past quarters, reaching a peak at 9.3% YoY in Q1 2019.
Global credit impulse leads the real economy by 9 to 12 months. If our model is correct, we should see a rebound in global growth in Q1-Q2 2020 after reaching a low point in H2 2019. Countries that should benefit the most from improved credit pulse are those with strong trade links with China, especially South Korea, Japan and Australia. We also expect that the effect of credit pulse will be amplified by fiscal pulse in many countries. Upcoming debates over 2020 budget should path the way for demand-oriented stimulus and infrastructure investments.
Currently, there are nine major economies in recession or on the verge of it: Argentina, Brazil, Germany, Italy, Mexico, Russia, Singapore, South Korea and the United Kingdom. Interestingly, out of the nine, five went through a sharp and often prolonged contraction in credit impulse. Along with China’s importing less, trade war friction and, in some cases, bad domestic policies, negative credit impulse appears as one of the key drivers behind poor economic performance in these countries.
This is particularly the case for the United Kingdom that has experienced seven consecutive quarters of contraction, with credit impulse running at minus 4.4% of GDP. The lack of new credit growth fueling the economy substantially increases the risk of recession in highly indebted countries like the United Kingdom. Despite Q2 GDP contraction, we think the likelihood of a technical recession is remote in Q3 2019 due to the combination of stockpiling and positive consumer sentiment ahead of Brexit deadline. However, everything is already in place for recession. It is only a matter of time before it happens, more probably in early 2020 if no-deal Brexit prevails.
The case for recession in Q3 is stronger for Germany. Germany’s credit impulse has been decelerating since Q1 2018, only running at 0.4% of GDP according to the latest estimate. On the top of that, the manufacturing sector is in disarray and we start to see a contagion of weakness from manufacturing to services. The latest German PMI Services was out a solid 54.4 in August but lower from its highest annual point of 55.8. The gap observed between the manufacturing sector and the service sector is doomed to be reduced in coming months, with the service sector going down. Technical recession is our central scenario for Q2-Q3 2019.

via ZeroHedge News https://ift.tt/2PpuXAM Tyler Durden

Pro-Democracy Activists Joshua Wong and Agnes Chow Arrested in Hong Kong

Two prominent Hong Kong activists, Joshua Wong and Agnes Chow, were arrested Friday for participating in unauthorized assembly and inciting other protesters to do the same. Both have been released on bail. Hong Kong police have also denied organizers permission to hold a march planned for Saturday.

The two 22-year-olds are leaders of Demosisto, an organization that backs greater autonomy and self-government for Hong Kong. (Wong serves as secretary-general while Chow is on the standing committee.) Wong first entered protest politics during Hong Kong’s “umbrella movement” of 2014. Those roughly three months of demonstrations called for giving the semi-autonomous Chinese city’s residents the right to elect their chief executive directly, without the Communist Party pre-screening the candidates. Currently, citizens “elect” the chief executive, but have no options aside from candidates who have earned Beijing’s stamp of approval.

The current round of protests was set off by a bill, introduced in early June and suspended shortly thereafter, that would have allowed Hong Kong to extradite accused criminals to both Taiwan and mainland China. While the marchers are glad the legislation was suspended, they want it fully pulled—and they have broader demands too.

“The chief executive of Hong Kong should be elected by Hong Kong’s people instead of picked by Beijing,” Wong tells Reason. “We urge the government to terminate the bill, stop police brutality, and respond to our calls for free elections.”

Though Hong Kong is technically a part of China, it operates under a “one country, two systems” policy that allows Hongkongers to enjoy basic democratic norms and due process. In 2047, though, Hong Kong’s quasi-independent government will be dissolved and it will become fully absorbed into mainland China. The protesters fear China is speeding up this timeline.

“‘One country, two systems’ has already eroded,” says Wong. “It’s one country, one and a half systems.” He adds that “Mainland Chinese people also deserve democracy.”

Tensions between the protesters and the authorities have escalated in recent weeks. In mid-August, police beat up community organizers and shot a woman in the eye with a non-lethal bean bag round. Days later, airport protesters attacked some men they believed to be undercover Chinese infiltrators. (Their suspicions turned out to be right—one was a cop from Shenzhen, the other a reporter for state-owned media.) About a week after that, Chinese authorities disappeared a staffer at the British consulate in Hong Kong. The Washington Post reports that police have arrested more than 800 people in connection with the protests over the past few months.

“I was really shocked by the threat of police to us people on the fifth of August, the day we had the general strike,” Wong says. “I joined the assembly outside of the government headquarters, and a sniper from the riot police fired tear gas from 40 floors” up. Wong says police have fired more than 2,000 tear gas shells over the course of the protests.

Now the cops are cracking down on protesters’ ability to assemble in public places. The Associated Press reports:

The organizers of Saturday’s march, the fifth anniversary of a decision by China against allowing fully democratic elections for the leader of Hong Kong, said they were calling it off after an appeals board denied permission. It was unclear whether some protesters would still demonstrate on their own.

The police commander of Hong Kong island, Kwok Pak Chung, appealed to people to stay away from any non-authorized rallies, warning that those caught could face a five-year jail term.

“In the past five years,” Wong says, “activists were jailed, lawmakers were kicked out of office, foreign correspondents were expelled from Hong Kong, and book publishers were kidnapped to China. It’s not only saying that Hong Kong is a place far away from democracy—it’s also saying that Hong Kong is a place without basic political and economic freedom.”

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Recession Alarm: Crude Processing At US Refiners Falls The Most Since Financial Crisis

There are more signs the US economy is rapidly deteriorating. This time it’s coming from the energy sector.

A new report from Reuters’ Senior Market Analyst John Kemp reveals how US refiners have cut the volume of crude processed this year to levels not seen in a decade as fuel stockpiles remain at elevated levels, suggesting a manufacturing and freight recession could be materializing.

US refineries slashed an average of 247,000 barrels per day since January 2019 compared with the same period in 2018, according to data from the US Energy Information Administration (EIA).

In the latest EIA report titled “Weekly petroleum status report,” Kemp said YTD processing rates have fallen for the first time since 2011, and by the most since the recession of 2008/09.

Refinery crude consumption has dropped by 56 million barrels so far compared with the same period in 2018.

Kemp noted that refiners cut processing volumes during the regular maintenance season in March and April and have never recovered since.

And here’s evidence that the consumer could be weakening even though fuel prices and interest rates remain low:

“Processing has remained at or below prior-year rates throughout the summer driving season, normally the highest demand of the year,” Kemp said.

This could suggest that manufacturing and freight slowdowns are starting to have spillover effects on consumer spending habits.

Kemp said:

“Philadelphia Energy Solutions’ 335,000 bpd refinery on the East Coast has been shut since a fire and explosion on June 21, which may have contributed to the loss of crude processing.

But processing was already running below prior-year rates before the plant exploded and has been below 2018 rates for 13 out of the last 16 weeks since the start of May.

Refiners on the East Coast have cut processing by an average of almost 120,000 bpd so far this year (mostly due to the Philadelphia explosion).

But they have also reduced processing by 87,000 bpd in the Midwest, 15,000 bpd along the Gulf Coast and 45,000 bpd on the West Coast.”

Despite refiners limiting crude processing this year, gasoline and distillate fuel stocks remain at high levels.

Consumer fuel consumption is stagnating, unchanged compared with last year, hinting that the consumer has been weak for all of 2019. Distillate demand is down slightly on the year as the freight industry stumbles into a possible recession.

Kemp also said:

“Forward refining margins for gasoline and distillates delivered at the end of the year do not provide refiners with any significant incentive to boost processing compared with normal seasonal patterns.”

And with the US possibly sliding into a mild recession before election day. Refiners will likely continue limiting crude processing, a direct result of a fragile consumer.

via ZeroHedge News https://ift.tt/2L8M0Tm Tyler Durden

Pro-Democracy Activists Joshua Wong and Agnes Chow Arrested in Hong Kong

“‘One country, two systems’ has already eroded,” says Wong. “It’s one country, one and a half systems.” He adds that “Mainland Chinese people also deserve democracy.”

Now the cops are cracking down on protesters’ ability to assemble in public places. The Associated Press reports:

The organizers of Saturday’s march, the fifth anniversary of a decision by China against allowing fully democratic elections for the leader of Hong Kong, said they were calling it off after an appeals board denied permission. It was unclear whether some protesters would still demonstrate on their own.

The police commander of Hong Kong island, Kwok Pak Chung, appealed to people to stay away from any non-authorized rallies, warning that those caught could face a five-year jail term.

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Is the Surgeon General Right About the Risks of Marijuana Use During Pregnancy?

Surgeon General Jerome Adams yesterday issued an advisory about the “health risks” posed by marijuana use during pregnancy. He considers it “alarming” that “many retail dispensaries recommend marijuana to pregnant women for morning sickness.” During a press conference explaining the advisory, Secretary of Health and Human Services Alex Azar declared that “no amount of marijuana use during pregnancy or adolescence is safe.”

Azar’s formulation is weirdly categorical, since it’s widely accepted that the use of potentially hazardous medications during pregnancy may be appropriate when the benefits outweigh the risks. And while there are legitimate reasons to be concerned about the danger that cannabis may pose to fetuses, the evidence is more ambiguous than Adams and Azaar imply. The relevant question is not whether marijuana use during pregnancy is completely “safe” but whether the evidence against it is strong enough to conclude that it should always be avoided, even when it provides relief to women who would otherwise be incapacitated by nausea.

Marinol, an anti-nausea medication that the Food and Drug Administration (FDA) approved in 1985, is an instructive example. The FDA has placed Marinol, a.k.a dronabinol, in Pregnancy Category C, which means “animal reproduction studies have shown an adverse effect on the fetus and there are no adequate and well-controlled studies in humans, but potential benefits may warrant use of the drug in pregnant women despite potential risks.” That category also includes commonly prescribed drugs such as the asthma medication albuterol and the antidepressants Prozac (fluoxetine) and Zoloft (sertraline). Marinol’s classification is especially relevant in this context, since it is a capsule containing THC, the main active ingredient in marijuana and the cannabinoid that worries Adams in connection with developing fetuses.

While Marinol’s manufacturer, AbbVie, says pregnant women should not take it, the advice from the companies that make Prozac, Zoloft, and Proventil (an albuterol inhaler) is notably different. Eli Lilly says Prozac “should be used during pregnancy only if the potential benefit justifies the potential risks to the fetus.” Similarly, Pfizer says, “Women who are pregnant, plan to become pregnant, or who are breastfeeding should not take ZOLOFT without consulting their physician.” Merck says, “If you are pregnant or nursing, contact your physician about use of PROVENTIL HFA Inhalation Aerosol.”

Marinol, which contains only THC and is taken orally, is not quite the same as marijuana, which contains lots of other compounds and can be smoked, vaped, or absorbed in the mouth via sprays or drops as well as swallowed in the form of beverages or edibles. What does research show specifically about the effects of marijuana use during pregnancy?

Adams cites The Health Effects of Cannabis and Cannabinoids, a 2017 report from the National Academies of Sciences, Engineering, and Medicine, so let’s start there. “There is limited evidence of a statistical association between maternal cannabis smoking and pregnancy complications for the mother,” the report says. “There is substantial evidence of a statistical association between maternal cannabis smoking and lower birth weight of the offspring….There is limited evidence of a statistical association between maternal cannabis smoking and admission of the infant to the neonatal intensive care unit….There is insufficient evidence to support or refute a statistical association between maternal cannabis smoking and later outcomes in the offspring (e.g., sudden infant death syndrome, cognition/academic achievement, and later substance use).”

The meaning of these “statistical association[s]” remains unclear, as a 2018 report from the American Academy of Pediatrics (AAP) explains. “The evidence for independent, adverse effects of marijuana on human neonatal outcomes and prenatal development is limited,” the AAP notes, “and inconsistency in findings may be the result of the potential confounding caused by the high correlation between marijuana use and use of other substances such as cigarettes and alcohol, as well as sociodemographic risk factors. However, the evidence from the available research studies indicate reason for concern, particularly in fetal growth and early neonatal behaviors.”

Given the uncertainty, the AAP, like the American College of Obstetricians and Gynecologists, recommends abstinence during pregnancy and breastfeeding. The American Medical Association, meanwhile, has proposed a milder warning for cannabis products: “Marijuana use during pregnancy and breastfeeding poses potential harms.”

The AAP and the ob-gyn group prefer that pregnant women err on the side of abstinence, which also seems to be what Adams is recommending. But prospective mothers may reach different conclusions, especially if they suffer from severe nausea and find that marijuana relieves it more effectively than other medications.

The National Institute on Drug Abuse (NIDA) is sponsoring four studies aimed at more definitively measuring the risks of marijuana use during pregnancy. “I don’t want us to cry wolf,” NIDA Executive Director Nora Volkow told the Associated Press this month. “We have to do these studies in a way that can identify risks.”

A NIDA-sponsored study by researchers at the University of Washington, for example, is enrolling pregnant women in their first trimester who are already using marijuana for morning sickness. “Infants will undergo brain scans at 6 months and will be compared with babies whose mothers didn’t use marijuana while pregnant,” A.P. reports. The researchers will not supply marijuana to the subjects, and the study is limited to women who have already decided that the benefits of using cannabis during pregnancy outweigh the risks.

“They’re making a choice that people might not agree with,” said the lead researcher, Natalia Kleinhans. “But it’s not out of desperation. It’s an informed choice.”

The very attempt to verify marijuana’s risks has aroused the ire of physicians who think the issue is already settled. “We should be encouraging women who are pregnant to not use marijuana instead of incentivizing them to continue,” a critic of the study, Washington ob-gyn Pat Marmion, told A.P.

That position is hard to fathom given the unsettled state of the science and the fact that many women are already using marijuana to relieve pregnancy-related nausea. Virginia ob-gyn Mishka Terplan perceives a double standard, noting that drugs commonly prescribed for morning sickness may also have unknown risks. (My wife, for example, was prescribed compazine, a Pregnancy Category C drug, for morning sickness.) “We shouldn’t assume that because we classify something as illegal that it is shameful,” Terplan said, “and that because something is legal and prescribed, it’s helpful.”

Susan Weiss, who directs NIDA’s Division of Extramural Research, firmly rejects the suggestion that the existing evidence is adequate. “One of the big arguments about why this is unethical is that we already know the answers,” she told A.P. “That is not true….We’re living in this very large social experiment and we need to learn from it.”

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Roberts: The Trade War Is Over & Nobody Won

Authored by Lance Roberts via RealInvestmentAdvice.com,

“You break it, you own it.”

Then-Secretary of State Colin Powell cited this Pottery Barn rule back in 2002. He was advising President George W. Bush of the consequences should an Iraq invasion go badly.

In fact, Pottery Barn has no such rule. You can go in their stores and handle the merchandise all you wish. They see occasional breakage as a cost of doing business.

But Powell still chose a good metaphor. Presidents aren’t just shopping for knickknacks when they make economic and foreign policy decisions. They have real, sometimes deadly consequences.

Bush should have listened more closely.

Far from the “cake walk” Pentagon officials predicted, the Iraq War cost the US vast amounts of money and several thousand lives, not even counting the (much larger) Iraqi death toll.

Worse, the underlying nuclear proliferation problem Bush sought to solve is still with us.

President Trump’s trade war looks more like the Iraq fiasco every day. Some of the China-related problems are real. The US is right to demand changes. But Trump’s tariff strategy is…

hurting American businesses, farmers, and consumers;

not solving the China problems; and

possibly making them even worse.

When you can’t possibly win, the wisest choice is to disengage and try again later. Beijing appears to be doing exactly that.

Conversely, Trump is breaking valuable merchandise and still not achieving any of his trade goals.

That may be entertaining, but it’s not “winning.”

Currency Unleashed

Some important stuff happened in the last two weeks. We may look back and see them as historic.

First, the Federal Reserve cut interest rates, in part due to the economic damage Trump’s trade fights are causing.

Second, having successfully forced the Fed to bend, Trump immediately caused yet more damage by threatening yet more tariffs on China.

(That should tell Jerome Powell something: Trump will consume any breathing room the Fed provides, which means looser policy won’t achieve what the Fed wants. So why do it? Good question.)

Third, China responded by letting its yuan currency fall against the US dollar. This partially offsets the impact of Trump’s tariffs on Chinese businesses.

Fourth, the US Treasury Department labeled China a “currency manipulator.”

In fact, what China did was stop its previous manipulation, which had kept the yuan artificially strong. That’s a step in the right direction if you actually believe in free markets.

China could have done this long ago, but Xi Jinping kept it as his ace card. It’s a risky move with enormous symbolic value.

Using the yuan in this way means (loosely translated from the original Mandarin): “We’re done, Trump. Call us when you want to actually negotiate.”

That won’t happen, of course, because Trump can’t admit failure or show weakness. He is more likely to crank up the pressure even more. Chinese leadership knows this and is ready for it.

But not everyone is ready.

Zero Profit Growth

Lost amid the late-July news torrent was a big revision to the Commerce Department’s “national accounts” data. That’s where we get Gross Domestic Product (GDP).

Previously, the data showed a big jump in pretax corporate profits beginning in 4Q 2016 (coincident with Trump’s elections). The revisions now show pretax profits were essentially flat since then.

Chart: Gavekal Research

The 2017 tax cut helped corporate profits, but less than we thought.

Of course, it could have been worse. Profits could have turned into losses. But if—as CEOs never tire of saying—profits prove business success, the fact they aren’t growing under a supposedly “pro-business” administration is a bad sign.

Why is profit growth down to practically zero? Many reasons, but the trade war is a big one.

Let’s also note, flat profits overall do not mean flat profits everywhere. Some US companies are doing just fine. They tend to be those with less international exposure, or those benefiting from Trump regulatory changes and deficit spending. Rarely is it because customers are spending more.

Which means, these companies aren’t prepared to withstand a recession. Many are highly leveraged, having borrowed enormous sums to finance share buybacks. They will resort to layoffs quickly when revenue shrinks, because they will have little else to cut.

All this leads nowhere good.

The trade war is harming the economy and delivering no benefits in return. None, zero, zip.

As a political matter, though, Trump must keep fighting even if China won’t fight back. Unless he can get some face-saving compromise (highly doubtful), we should expect more tariffs, “national security” export controls, and other pressure tactics.

I don’t think they will work. Unlike Trump, Xi Jinping doesn’t have to worry about re-election, and he has more ways to keep his population under control if the Chinese economy stumbles.

Consequences For All

In sum, the US will keep fighting a trade war we already lost. We will do that because our president likes tariffs and (wrongly) thinks they help the economy. Congress knows otherwise but is incapable of stopping him. The Iraq parallels are obvious.

But tariffs actually aren’t the worst part of all this. The worst part is that businesses are paralyzed, unable to make growth decisions because they have no idea what government policy will be next week, let alone a year from now.

That, I believe, is the main reason business profits aren’t growing. Boards have gone into survival mode—just trying to hold what they have and using buybacks to create the illusion of growth.

This has consequences for everyone, most immediately the workers who will lose their jobs when recession strikes. But investors will lose, too.

US public companies are $12 trillion more valuable than they were when Trump was elected. They are not $12 trillion more profitable. Share prices are up because investors are paying higher prices (P/E ratios) for the same “goods,” i.e. earnings.

It didn’t have to be this way. We might have had a mild recession that was winding down right now. But no. Instead we got a damaging trade war, corporate tax cuts that inflated asset prices without sparking much growth, and politically-driven monetary policy.

Will the one who broke it, own it, as the Pottery Barn rule requires?

via ZeroHedge News https://ift.tt/2Lcz1zW Tyler Durden

Is the Surgeon General Right About the Risks of Marijuana Use During Pregnancy?

“They’re making a choice that people might not agree with,” said the lead researcher, Natalia Kleinhans. “But it’s not out of desperation. It’s an informed choice.”

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Hugh Hendry Plots Caribbean Comeback On St. Barts

After underestimating the power of unlimited monetary Kool-Aid, former Eclectica asset management co-founder Hugh Hendry has reinvented himself – this time developing properties in the celebrity island playground of St. Barts.

The 50-year-old contrarian who made a killing going into the 2008 crisis only to be outdone by ‘the greatest experiment’ is now looking to provide investors annualized returns of at least 10% by cashing in on growing demand for real-estate on the Caribbean island. Hendry seeks to raise $50 million to buy land and renovate existing properties, according to Bloomberg.

In addition to building high-end luxury villas, Hendry also plans to build affordable homes to help address what he called a “housing crisis for the working community” on the island. The fund, based in Luxembourg, could deliver annualized returns of at least 10% for investors, he said. –Bloomberg

“This place is one of a kind,” said Hendry – who compared St. Barts to Galt’s Gulch in “Atlas Shrugged.” “It’s where all the rich folks are going to end up at the end of this mammoth return-on-capital cycle,” he added.

Villas on the island range from $500 per night for a room to well over $100,000 per week, according to the former hedge fund manager, who lives on St. Barts.

“St. Barts is like a ski village with a 10-month season — lots of young kids who work hard and play hard,” said Hendry. “No one can normally afford to buy a house; there is no such thing as affordable homes.”

St. Barts was severely damaged during Hurricane Irma in 2017, which reduced the housing stock and pushed rents even higher.

“There is a clear and evident demand for capital to come in and eliminate the shortage,” said Hendry.

Years of mediocre returns and investor withdrawals have diminished job prospects in the $3 trillion hedge-fund industry, forcing some of its best-known names to quit. While many return after a break to launch new funds, others have branched out into everything from picking winners in the marijuana industry to selling sandwiches.

Hendry’s hedge fund churned out a 31% return by betting against U.S. and European banks during the 2008 financial crisis. He also attracted attention for his bearish view on China in 2009, when he posted videos on YouTube in which he toured cities and identified office buildings that he said had no tenants. Then in 2017, Hendry packed it in, saying the macro hedge fund model was broken. –Bloomberg

Hendry started out working for Edinburgh investment manager Baillie Gifford before moving to Credit Suisse Group AG. He then joined Crispin Odey’s hedge fund in 1999 before finally forming his own firm – Eclectica Asset Management.

via ZeroHedge News https://ift.tt/30LMfJF Tyler Durden

Just Another Day In Hysteria-Gripped Media-Land

Authored by James Howard Kunstler via Kunstler.com,

Fish Fry

The old plantation spiritual comes to mind as the first in a series of DOJ Inspector General’s reports is issued – this one outlining the turpitudes of former FBI Director Jim Comey – while even more fateful inquiries by Barr and Durham grind away in silence and mystery, and one senses that sometime soon the whole hot mess of RussiaGate will land on the doormat of Barack Obama.

Many other (by now) well-known names have been implicated in this fiasco but Mr. Obama has stood aloft from them on a fluffy cloud of his own, enjoying his multimillion book deal, plenty of international travel, and shopping for real estate on Martha’s Vineyard, the elephants’ graveyard of the One Percenters. And yet, something wicked is creeping his way as investigators work up the food chain to discover why and how so many high government officials cooked up a scheme to get rid of the despised winner of the 2016 election.

President Obama, Liberalism’s great bowling trophy, its incarnate virtue signal, is going to get “the business” from the very justice department he sicced on his successor, only now under new management. If you think the Left has gone batshit crazy since the Mueller report flopped, along with the supposed author’s Mr. Magoo-like performance before congress in July, just wait until Mr. Obama is called upon to do some official ‘splainin’ about who exactly authorized the operation to unseat Mr. Trump. I daresay the Left would rather blow up what remains of the Republic than see their retired champion in a witness chair, subjected to the peevings of mere mortal federal attorneys.

And yet, certain remorseless legal machinery has been set in motion now that could send a whole boardroom of former Obama administration higher-ups into disgrace, infamy, and possibly the federal slammer. Think: former CIA Director John Brennan in his future role as ping-pong round-robin manager at the Allenwood, PA, penitentiary; Loretta Lynch paring turnips at Camp Alderson, WV; James Clapper trying to catch a little tan in the ‘yard’ at Lompoc…. Somewhere along the line, someone is going to point a finger at Mr. Obama and those who were around him in the dear dead days of 2016.

There’s no precedent for this, of course, not even the case of ole Tricky Dick Nixon, who never had to take a witness chair in the Watergate matter and received a pardon from his successor, Gerald Ford, which made the whole tiresome business go away pronto. Wouldn’t it be a kind of poetic justice if Mr. Trump had to do the same for Mr. Obama? The New York Times would surely find a way to spin that as “racist.” CNN would declare war on FlyoverLand and send Don Lemon to Kentucky in a Lincoln Navigator with a light-saber to subdue the Ku Klux Klan and the satanic hosts of White Supremacy. Well, you see how easily this country could lose its shit.

In the meantime, cries of consternation rise from Right at the DOJ’s demurral to actually indict Mr. Comey on any of the charges listed rather explicitly in the new report. The explanation goes something like this: Comey gave an official FBI memo of his own composition to pal (and attorney) Daniel Richman, and instructed him to leak the contents (though not the memo itself) to a New York Times reporter. The memo involved recollections of a one-to-one meeting with Mr. Trump in which the case of General Flynn came up, with Mr. Trump making the case that there was nothing illegal about the National Security Advisor speaking with the Russian ambassador — since, after all, that is precisely what ambassadors from foreign lands are in Washington to do. I actually wouldn’t be surprised if it turned out that Mr. Comey was wearing a wire during that, and several other, meetings he had with Mr. Trump — before the president grokked that he was being personally set-up for an obstruction-of-justice rap and issued Mr. Comey a pink slip.

In sum, this particular matter amounted to a rinky-dink charge, where Mr. Barr’s prosecutors are concerned, compared to the greater and darker matter of Mr. Comey’s role in defrauding the FISA judges to get warrants to spy on US citizens. That will likely be Mr. Comey’s true Waterloo. So, he greeted this week’s IG report with a smarmy Twitter tweet celebrating his imagined “exoneration.” Imagine instead what his cortisol level will be in the months ahead as he awaits further moves by Messrs Barr, Durham, and IG Horowitz.

In an early riposte to all this bother, hapless MSNBC anchor Lawrence O’Donnell came out with a “bombshell” report that Mr. Trump had used a claque of Russian oligarchs to co-sign some loans in his hotel business – more proof that the President is Putin’s puppet! Alas, like so much other information seeping from the bloated, decomposing carcass of RussiaGate, the report had not been verified before Mr. O’Donnell opened his pie-hole to blab it out on prime-time TV. The President’s attorneys promptly offered to sue Mr. O’Donnell for defamation unless he apologized post haste and renounced the phony report. Which he did. Just another day in hysteria-gripped MediaLand.

As a sidelight, given the content of the IG’s report on Comey, one can easily imagine Judge Emmet Sulilvan having to now throw out the case against General Flynn, which has been fermenting in pre-sentencing limbo for the better part of a year, perhaps awaiting developments like these. If not, Mr. Trump will surely have to pardon the General. It would be real poetic justice to see him hired back to the job he was underhandedly shoved out of.

via ZeroHedge News https://ift.tt/2HAQ1hb Tyler Durden