The Secret Way To Party Like An Elite When You"re In Monaco

The Monaco Yacht Club is one of Europe’s most exclusive clubs. This place has everything: Russian oligarchs, Chinese titans of industry and members of Europe’s royal families mingle with the rich and famous from around the world.

While entry to the club is probably unfeasible for most people of average means, Bloomberg reports that there’s still a way in to the club that was founded by the late Ranier III, Prince of Monaco and husband of Grace Kelly.

For those who don’t hold a golden entrance key, there’s still a way in – to the Foster+Partners-designed building, that is. Curious tourists need to visit the Wine Palace.

Of course, becoming a member requires two sponsors, approval by club president Prince Albert II, and a fee the club declined to disclose.

The club boasts some impressive stats: It keeps 3,200 bottles of wine, Champagne, and spirits on its shelves. Most are French, with Bordeaux producers Château Smith Haut Lafitte and Château Cheval Blanc being particularly hot sellers. Prices start from just €10 ($12) a bottle and average around €40, despite the boîte’s fashionable location. The food menu is compact but ticks all the boxes, with a varied cheese platter, foie gras, palm-size tartines, smoked fish and, in summer, a pretty pile of tiny heirloom tomatoes and rounds of fresh mozzarella.

A seat on the club’s terrace allows for prime people-watching. And while the Wine Palace might not be officially part of the Yacht Club, many of the club’s members will visit the restaurant to peruse its wine selection.

Monaco boasts an impressive array of vaunted restaurants, five Michelin-starred, eleven Michelin-recommended. But for travelers on a budget, Bloomberg interviewed several locals and assembled a list of sleeper picks:

Maya Bay:

“A well-known Japanese-Thai spot on the ground-level of a very standard apartment complex, the bland exterior here belies how trendy the restaurant actually is. Reservations are essential, especially if you want to sit outside. There is an indoor dining room with a dozen tables and chandeliers dripping from the deep red ceiling, plus a wood pavilion in the peaceful garden out back. 24 Av. Princesse Grace; Lunch 12–2:30 p.m., dinner 7:30–11 p.m.”

Sass Café:

“The Mediterranean-leaning Sass Café is a great pick for dinner. It serves such delicate dishes as tagliolini with prawns and rucola or Provençal sea bass to tables of suited and heeled couples. 11 Av. Princesse Grace; dinner nightly from 8 pm.”

Monte-Carlo Beach Club:

“Classic Côte d’Azur embodied: Think chairs with beautiful white-and-blue striped cushions and iconic views from the terrace, especially late in the day when the sun starts setting behind the mountains and the water and all of Monte Carlo stretch out before you. Nicolas Bellavance-Lecompte, co-founder of design fair Nomad Monaco, says it makes the most elegant of aperitivo hours: “I like the negroni, and to eat, I have the barbagiuan, a fritter with chard and ricotta, which is very Monaco.” 2 Av. Princess Grace; open daily.”

Buddha Bar:

“Monte Carlo staffers whose job it is to know where to go— a bartender at Hôtel Metropole, the concierge at Hôtel de Paris, and two clued-in employees of the Casino de Monte-Carlo (which, to be fair, does have the same owner)—recommend Buddha Bar, once home to the 154-year-old casino’s cabaret bar. People come for sushi and stay for mojitos, which are still having a moment on the Riviera. If you don"t want to go to a club but still want to listen to music and dance a little, this is the spot. Place du Casino; 6 p.m.–2 a.m. daily.”

Odyssey:

“By day, this Karl Lagerfeld-designed Joël Robuchon restaurant is for hotel guests only, but nights from May to October, the outdoor restaurant is open to all. It’s a low-key contrast to Robuchon’s formal restaurants within the hotel; the fare is simpler and seasonal. There might be lobster medallions and eggplant risotto, sandwiches, grilled meats, or salads with white tuna belly and anchovies. Diners, Champagne in hand, tend to be mid-30s and up, a mix of couples, families, and friends out for a refined but relaxed dinner. Inside Hôtel Metropole, 4 Avenue de la Madone; from 7:30 p.m. daily May to October.”

Now that the famous Monaco Yacht Show has come and gone, tourists looking to avoid massive crowds can easily enjoy sightseeing and local amenities without needing to push through crowds of Lanvin-wearing beauties and the bajillionaires they begrudgingly tolerate.
 

My Big Fat Greek Tax Scam

Via AdventuresInCapitalism.com,

To see part 1, click here

Sacha Imbert (Portfolio Manager at RBC): Hey Kuppy, this receipt says we’ve just used a Bulgarian POS to pay for lunch!!!

 

Me: Whoa!!! That can’t be right.

 

Waiter: Don’t worry, it’s a famous Greek trick. Revenues go to Bulgaria, expenses stay in Athens. We also get around the exchange controls.

 

Me: Won’t the Greek government get upset?

 

Waiter: Actually, they’re pretty happy we’re screwing the Germans… How else will the economy grow?

 

Sacha: No wonder the Greek Banks have such profitable Bulgarian subsidiaries… haha

Yup, everything you’ve heard about Greek tax scams is true.

Then again, how can you blame the Greeks. Based on all the new taxes enacted by the Troika, effective tax rates are well over 100%.

If Greeks actually paid them all, there would be nothing left - so when Greeks say, “We are Greek, cheating taxes is patriotic,” they tend to mean that.

What crisis? Look at this row of yachts in Athens.

At the same time, this creates all sorts of distortions in the economy. Greek corporates are issuing bonds at a 200bps tighter spread than the Greek sovereign, Greek banks are starved of liquidity as Greeks shift capital overseas or into mattresses and government economic data is questionable at best. In fact, quite a few Greeks attributed the recent economic recovery to an increased use of credit cards which government statistics do a better job of capturing—as opposed to a true recovery.

During my dozens of meetings with Greeks, I always asked the same questions;

“What percentage of Greece’s economy is off the books?” 20 to 30%

 

“Are you hiding money offshore?” Of course

 

“How many secret Cypriot companies do you control?” At least 2

Is it any wonder that the economy has struggled recover?

When you enact excessive taxes and regulations, people will always sidestep them with high frictional costs and losses for the overall economy - particularly if the enforcement policy wavers between lax and corrupt. How Greece eventually solves these problems will tell you a lot about how far the economic recovery can actually go.

In the interim, it’s always helpful to know that paying with cash gets you a free glass of wine and when you have run out of cash; the “broken” credit card-reader will miraculously work…

First Pictures Emerge Of Vegas Shooter's Weapons, Hotel Room

Somehow, Boston 25 News has obtained exclusive photos from what they describe as "police sources" purportedly showing the guns used during Sunday night"s massacre in Las Vegas, where a 64-year-old shooter with a room full of weapons fired on a country music festival from the 32nd floor of the Mandalay Bay casino and resort, killing 59 people and injuring more than 500.

Boston 25’s Jacqui Henrich obtained the photos early Tuesday morning, and they clearly show the gun on the floor of the Mandalay Bay hotel room, along with many rounds of ammunition.

EXCLUSIVE: photo from inside #MandalayBay shooter’s hotel room shows gun, ammo, hammer, bipod, optics @boston25 pic.twitter.com/4B2iRhquq5

— Jacqui Heinrich (@JacquiHeinrich) October 3, 2017

A hammer that was presumably used to break the windows of the room, which was on the 32nd floor, can be seen beside the gun. The bipod used to stand the weapon on as the shooter sprayed the crowd with bullets is also in view.

Las Vegas police said the shooter, Stephen Paddock of Mesquite Nevada, had 23 guns inside his hotel room, including semiautomatic rifles. An additional 19 guns were discovered in his home in Mesquite, along with thousands of rounds of ammunition. Meanwhile, explosives were found in his car, suggesting he may have been planning something even worse than the worst mass shooting in modern American history.

Paddock killed himself as police entered his hotel room, Boston 25 reported.

While none of the weapons in the photos are fully automatic arms, the "bump stock" that was used by the shooter to mimic automatic-weapons fire can plainly be seen attached to the butt of one of the shooter"s rifles, as the Tribunist points out.

* * *

In a development that only deepens the mystery surrounding Paddock"s motives, NBC news is reporting that the man who will go down in history as the Mandalay Bay shooter lost a slip-and-fall lawsuit against a Nevada casino in 2014. He reportedly still owed $270 in court fees at the time of his attack.

Security video from the Cosmopolitan Hotel shows Paddock slipping and falling on Oct. 30, 2011, as he walked from a hotel shop towards a high-stakes area in the casino. Paddock said he had slipped in a puddle of liquid and sued the hotel in 2012, initially asking for $100,000, according to an attorney for the hotel.

Footage showing Paddock slipping and falling...

The lawyer met Paddock when he testified in a deposition for the lawsuit. Paddock enjoyed a special high-roller status with perks at at least one Vegas casino, the lawyer said, but he was unkempt in his appearance, looking slovenly and "bizarre" during the deposition.

However, the lawyer said there was "nothing about Paddock that would ever indicate someone who was unstable."

"This is not a guy that I would have looked at and thought, "He"s going to commit a crime one day."

Paddock"s suit ended up in arbitration in 2014. According to the decision, Paddock reported incurring more than in $32,000 in medical bills, and also wanted to be paid for pain and suffering. Security video shows him getting medical attention and then being stretchered out of the casino.

"As a result of the fall," said the document, "Mr. Paddock allegedly sustained a tear to his hamstring as well as a sprain/strain injury to his wrist" and elevated blood pressure. The hotel maintained that Paddock had failed to prove negligence because "there was no actual or constructive notice of any liquid in the area of the sundry shop."

The arbitrator confirmed that the video does show Paddock slipping and falling, but also noted a custodian can be seen passing the same spot about a minute before Paddock"s accident, followed by about 20 hotel customers, and none of them "appear to have noticed anything on the floor [or] tried to avoid a wet area."

According to Paddock"s brother Eric, Paddock was a millionaire thanks in part to real estate holdings in California. Caesar"s Entertainment had granted him a "Seven Stars" designation as a frequent gambler "with status" at its casino properties, according to a source familiar with the investigation. Seven Stars is the highest level that a high roller can achieve and is only granted by invitation.

In the weeks prior to his death, according to multiple senior law enforcement officials and a casino executive, Paddock had gambled large sums of money at Vegas casinos. Currency transaction reports show that Paddock had recently gambled more than $10,000 a day,

"Pizza Price Parity": Where Is Pizza Most And Least Expensive In America?

Via Priceonomics.com,

Between 2007 - 2010, a USDA study estimated that 1 in 8 Americans ate some form of pizza on any given day. That number climbs to about 1 in 4 for males and 1 in 5 for females when looking specifically at Americans age 12 to 19. There’s no escaping it; pizza is engrained in our diets.

Pizza is not only a pillar of the American diet, but also of our culture.

Through saturation of TV, movies, and now the internet, it has entered the zeitgeist. How do you make characters as strange as the Teenage Mutant Ninja Turtles more relatable? Make them love pizza. Right now, you can search on Amazon to find pizza sweatshirts, pizza pool toys, and pizza cologne. Even new disruptive and trendy technological innovations need their connection to pizza. That’s why there’s a pizza cryptocurrency and drone pizza delivery.

We noticed that pizza prices and availability can vary dramatically across the United States. We analyzed data from Priceonomics customer, Datafiniti, a data company that has digitized menus across America. Which states and cities have the most pizzerias? How much can you expect to pay for pizza across the country?

Starting with this business data, we searched for restaurants serving pizza. This data set gave us thousands of different listings to comb through for more detailed location and menu information. To control for differences in price because of toppings and sizes, we needed a standardized item for evaluation, so we found the price of a large plain pizza in each restaurant record. This baseline allowed us to compare prices across cities and states more accurately.

So, where can you find the most places serving pizza? Accounting for population, you can find the most pizza places concentrated in the Northeast, particularly Connecticut, Massachusetts, Rhode Island, and New Jersey. At the city level, the trend is not as clear, with Orlando, FL, Buffalo, NY, and Minneapolis, MN taking the top three spots. 

How much will you pay for a large cheese pie? Median prices range from $7.25 to as much as $15. Despite only looking at plain cheese pizza, there are subtle stylistic differences that likely lead to price variation. The neighborhood family-friendly pizza place and the typical franchise have much lower prices than artisanal wood-fire pizzerias. Other regional differences, like Chicago deep dish, lead to higher prices as well.

And the cities with the most expensive cheese pizzas in America? Buffalo, NY, Nashville, TN, and San Francisco, CA take the top three spots.

Despite those geographical differences, there is one universal truth: no matter where you are, you’ll be able to find pizza.

*  *  *

To start our investigation, we will want to see how pizza places are distributed across the country. To account for differences in population, our metric of interest will not be absolute number of restaurants, but instead number of restaurants per 100K residents. Controlling for populations makes sure some states, like California, do not dominate the top of our charts.

Data source: Datafiniti

The state with the most restaurants serving pizza is Connecticut, with 13.2 restaurants per capita. Smaller northeastern states with large Italian populations dominate the list, including Massachusetts (11.7), Rhode Island (11.6), and New Jersey (9.6).

New York and Illinois, two states that are known for their distinct styles of pizza, are in the second tier of states, along with areas of West, the upper Midwest, and Florida. 

States in the Deep South have the fewest number of pizza places per capita. We expect this result as these states don’t have distinctive pizza styles. Hawaii, despite having an eponymous pizza (the Hawaiian, which features pineapple and ham), is also in this group.

So looking at these states, what is the cost of the average large plain cheese pie?

Data source: Datafiniti

North Dakota and Wyoming have the most highest median prices. While there is no distinct regional trend, there are some possible explanations for what we see. These states have fewer pizzerias, which tend to be more upscale, artisanal sit-down restaurants. So in cases where you can find pizza, it’s just a more expensive variety. Maine and Alaska have the cheapest pizza options. While that’s not exactly the attribute you want your pizza to be known for, it is a great thing for pizza lovers in these states.

Now we will go one level deeper and take a look at America’s cities. Where can we find the most pizza restaurants per capita? When working with this data, we limited our comparison to the 50 cities with the greatest absolute number of pizza places.

Data source: Datafiniti

Orlando, FL sits at the top of our list with 21.6 restaurants per 100K residents. While Orlando is not known for any pizza tradition, a few things could be causing the abundance of pizza. Florida, in general, is known for tourism, Orlando especially. Pizza is guaranteed to interest tourists no matter where they’re from and it’s a great option for families when traveling. Ft. Lauderdale likely has a similar story.

Number two is a city from New York that is not NYC; it’s Buffalo (20.2). This mid-sized city has a sizable Italian community and its own style of pizza. It’s a medium-thick crust round pie that is somewhere between New York and Chicago pizza styles. 

Our third place city, Minneapolis (21.1), may seem like the odd-man-out at first, but the Midwest also has its own distinct pie. Its square shape and medium-thick crust is similar to the traditional Neapolitan pie that families would bake at home. You’re likely to see this shape of pizza across the Rust Belt, as far east as Detroit.

Now that we know where to find pizza, we should learn more about prices. Again we will look at the median price of a large plain pizza to compare our cities. 

Data source: Datafiniti

The city with the highest median price is Buffalo, NY at $14.79 for a large plain pie. In general, large metropolitan areas or mid-sized eastern cities compose the most expensive cities for pizza. Most likely their prices are just a product of the higher cost of living. 

At $5.99, Lexington, KY has the least expensive median price. Overall these cities are smaller and more often in the center of the country. Two of the cities with the most pizzerias, Orlando and Minneapolis, are also on our list for least expensive plain pies. That’s great news if you are a pizza lover in either of these cities. While we would need much more data to verify this idea, it could be possible that the high number of restaurants leads to greater competition and therefore better prices for customers.

"As Much Gold As You Can Eat..."

Over six years ago, former-Goldmanite and head of The New York Fed Bull Dudley proudly proclaimed how the price of iPads was dropping when confronted by an unruly audience demanding to know why their food costs were soaring, prompting guffaws and widespread murmuring from the audience, with one audience member calling the comment "tone deaf," and another quipping "I can"t eat an iPad."

Dudley"s infamous ignorance will never be forgotten and as The Fed continues to pump the prices of stocks up (which you also cannot eat) and the price of putting a roof over your head is soaring (also non-edible), Martin Armstrong put us straight on one potential inflation hedge... that it turns out you can eat...

I am working from the Abu Dhabi office this week meeting with clients in town.

I thought I would post something unusual.

In the Emirates Palace, you can have a cup of coffee with gold on top you can drink.

You can also order ice cream made from camel milk top with real gold you can eat.

Interesting use of gold.

"Unprecedented Thefts" Force Baltimore Bike-Sharing Program To Suspend Operations

In 2016, the city of Baltimore partnered with Bewegen Technologies to launch North America’s largest electrical-assisted cycling (or pedelec) bike sharing program. The system is located in Baltimore’s metropolitan area with over 25 stations available. Fast forward one-year later, this grand "sharing economy" experiment in America’s most dangerous city has imploded due to what the company"s CEO says is a level of theft he has never experienced before.

As of today, Baltimore officials have suspended all operations of the bike fleet until October 15, 2017. According to the Baltimore Sun, the temporary shutdown is due to “thieves ripping the bicycles out at an unprecedented pace”, said Alain Ayotte, CEO of Bewegen Technologies, the Canadian manufacturer. The manufacturer of the $2.36 million Baltimore Bike Share system said his company has "never experienced the level of theft" that caused officials to announce a temporary shutdown of the program to allow additional locking devices to be installed to the bike docks.

Per Baltimore Sun,

"We don’t have this issue anywhere else, not at this level,” Ayotte said Wednesday. “Our locking system is recognized [as] very, very up to industry standard, but due to the issues that occurred in Baltimore this summer, we did add additional security.”

The bike-share program launched last fall with 200 bicycles at 20 stations and was supposed to grow to 500 bicycles at 50 stations in the spring. Instead, it has suffered so many thefts and maintenance backups that most of the bicycles are out of service. The program will close Sunday and reopen Oct. 15.

Unwittingly, some bicycle stations were placed in areas of extreme wealth inequality and high violent crime. Even though, each bicycle is outfitted with GPS, it did not deter thieves. Baltimore is suffering from a racial wealth divide according to JPM. The report highlights African Americans are 63% of the total 620k population with nearly 1/3 having a net worth of zero.

At one point, the thefts became so rampant, maintenance employees spent a majority of time searching for stolen bikes. The Department of Transportation had to apologized for misleading millennials about the true nature of the bicycle problem calling it a ‘rebalancing issue’.

In particular, a citizen named Brian Seel, wrote a Medium piece titled: “Baltimore Bike Share Only Has Four Bikes”. Recently, he rode to all 25 bike sharing docks and only found four working bikes. In the article, he explains how the ‘real problem’ is communication issues with the bike sharing company…

Mr. Steel rode to all 25 stations. In his first finding, he stopped at Baltimore City where there were no bikes, but 5 listed on the APP.

At Baltimore Visitors Center there were no bikes, but 7 listed on the APP.

In Baltimore’s financial district there were no bikes, but 6 listed on the APP.

Baltimore Bike Sharing’s twitter plays it cool….

@BmoreBikeShare any news about what"s happening with the bike share bikes? are they being retrofitted to stop theft, or where are they?

— Yargl Blargl (@evoinvitro) August 31, 2017

It’s a ‘manageable situation’

Know that most city bike share systems shut down for maintanance at least once a year. This is a manageable situation.

— Baltimore Bike Share (@BmoreBikeShare) September 13, 2017

The last one is hilarious: “This is not unusual”…..

Most city bike share systems shut down at least once a year for general maintenance. This is not unusual. We feel ya though.

— Baltimore Bike Share (@BmoreBikeShare) September 13, 2017

Baltimore is a shrinking city with a population at a 100-year low. Officials are unwittingly throwing money at anything, such as a bike-sharing system, to attract millennials. Unfortunately, there is too much overhang in a city where 50-years of democrat-controlled leadership, in-conjunction with decades of deindustrialization. This should be a big clue to millennials that the narrative of city life continues to crack.

Goldman Is Turning Increasingly Bearish On Junk Bonds

As we reported at the time, back in March in what was the first shot across the junk bond bow, Goldman downgraded the weakest cohort of high yield, CCC-rated bonds, to underweight from neutral and upgraded BB-rated bonds to neutral from underweight, while keeping an overweight recommendation on the "median", or B-rated bonds.

As shown in the exhibits below, and as Goldman"s chief credit strategist Lotfi Karoui admits, the performance of said rating allocation has been rather mixed.

As Goldman further writes, in some semblance of normalcy and logic, while CCC-rated bonds have underperformed their beta to both B and BB-rated bonds, B-rated bonds have been steadily underperforming their BB peers since mid-May. More granularly and as shown by Exhibit 3, the single B bucket has also accounted for the largest share of bonds that has suffered price declines of more than 5% since mid-May.

Conversely, single-Bs have also accounted for the smallest share of bonds that had more than 5% of price appreciation over the same period. The underperformance of B-rated bonds within the largest movers since mid-May, both up and down, reflects the growing fundamental challenges in many large capital structures in the Wirelines, Media, Energy, and Retail sectors.

So nearly half a year after its last rating revision in the sector, overnight Goldman"s Lotfi Karoui has once again revised his outlook on what has been on of the biggest winners from central bank intervention in capital markets, namely the junk bond space, and has turned even more bearish on the lower quality segments while boosting its outlook for near-IG paper, to wit: "shifting to a more defensive HY rating allocation: Overweight BBs vs. Bs and CCCs.  We upgrade BBs to overweight from neutral, downgrade Bs to underweight from overweight, and maintain our underweight recommendation in CCCs."

What is more notable, is that as justification for his bearish shift, Karoui points out that the fundamentals are starting to get downright ugly:

This allocation reflects a more defensive posture in addition to the lack of fundamental upside for many large B-rated issuers. For CCC-rated bonds, we continue to think the high exposure to secularly challenged sectors coupled with limited scope for fundamentals to improve still warrant an underweight allocation.

Why does this matter? Because for the past 18 months, or since the ECB launched its CSPP corporate bond monetization program, fundamentals have not mattered as investors snapped up any piece of paper, the worse the better, frontrunning the ECB"s own efforts to push up junk prices to record levels. But between the ECB"s upcoming tapering, and today"s Goldman recommendations, fundamentals - that anachronism that was obviated by nearly a decade of direct central bank intervention - may once again matter.

Here are the details:

Turning more defensive across the HY rating spectrum: Overweight BBs, underweight Bs and CCCs. We upgrade BB-rated bonds to overweight from neutral, downgrade Bs to underweight from overweight  previously, and maintain an underweight recommendation on CCCs. This allocation reflects a more defensive posture in addition to the lack of fundamental upside for many large B-rated issuers. For CCC-rated bonds, we continue to think the high exposure to secularly challenged sectors coupled with limited scope for fundamentals to improve still warrant an underweight allocation.

For context, Retail and high-cost Energy and Metals and Mining companies account for roughly a little less than a quarter of the combined market value of the CCC bucket (inclusive of non-index eligible bonds). We would however emphasize the  holistic nature of our cautious view, which ignores potential opportunities at the issuer-level.

No matter the reason behind Goldman"s cold feet, investors are still clearly living in a world in which central bankers have it all under control as the latest Barclays aggregate HY Corp yield index shows...

These Are America's Fattest States

According to a new report, one third of U.S. adults are obese along with one in six children.

The research was conducted by the Trust for America"s Health and the Robert Wood Johnson Foundation and, as Statista"s Nial McCarthy explains, it found that the adult obesity rate exceeded 35 percent in five states, 30 percent in 25 states and 25 percent in 46 states.

In 2016, West Virginia had the highest rate of obesity at 37.7 percent, followed closely by Mississippi with 37.3 percent. Alabama and Arkansas jointly round off the top three with 35.7 percent each.

You will find more statistics at Statista

Back in 2000, no U.S. state had an obesity rate higher than 25 percent.

As bad as the obesity epidemic is, the report also found that rates are starting to stabilize and actually decline in some places. Colorado, Minnesota, Washington and West Virginia all saw their obesity rates climb while Kansas saw a decrease.

The situation remained stable everywhere else.

Progress in halting the spread of expanding waistlines can be attributed to state policies improving access to healthy food and increasing physical activity.

The report notes that early childhood education has proven particularly effective at preventing obesity in early life, instead of having to reverse the problem in later years.

Curfews Issued Across Southern Florida Cities: "Deputies Will Not Be Responding"

Local governments are now issuing curfews across South Florida.

Broward County has issued a curfew starting at 4:00 pm and remains in effect until further notice.

A mandatory curfew will also be in place tonight in Coral Springs from 8:00 p.m. – 6:00 a.m.

The City of Fort Lauderdale will enforce a Countywide curfew beginning at 4 p.m.

A barrier island curfew will be in effect for the City of Deerfield Beach and the Town of Hillsboro Beach at noon. A Citywide curfew for Deerfield Beach will also begin at noon.

The City of Miami Beach issues curfew starting at 8:00 p.m. Saturday – 7:00 a.m. Sunday.

A mandatory 3pm curfew will be in place in Palm Beach County  until further notice

As CBS reports, Broward County Mayor Barbara Sharief said, “When winds reach 45 mph, deputies will not be responding.”

Effects of the storm will get stronger throughout the day. “By 2 p.m., residents will start feeling tropical storm force winds,” she said.

Current sights in #hollywoodbeach @BrowardCounty issuing a 4 pm curfew today! #HurricaneIrma @nbc6 pic.twitter.com/pF1wKTSxfX

— Melissa Adan (@MelissaNBC6) September 9, 2017

Authorities implementing noon curfew in Deerfield Beach. @wsvn pic.twitter.com/PQQvIH0mFq

— Lorena Estrada (@EstradaLorena) September 9, 2017

This Silent Public-Health Crisis Costs The US $150 Billion A Year

The opioid epidemic isn’t the only public-health crisis costing the economy hundreds of billions of dollars. According to the Trust for America’s Health’s annual “State of Obesity” report, nearly 40% of American adults are obese or overweight.  And collectively, they will add some $150 billion to the cost of health care, and billions more in lost productivity.

Obesity rates have finally stabilized after having nearly tripled since the CDC first began tracking them in 1960. They’ve doubled since the 1980s. Particularly problematic is childhood obesity, which is correlated with poor performance and school and other factors that could impact a child’s wellbeing into adulthood.

According to the study, obesity disproportionately affects low-income Americans:

“Obesity disproportionately affects low-income and rural communities as well as certain racial and ethnic groups, including Blacks, Latinos and Native Americans. Societal inequities contribute to these disparities. For example, in many communities, children have few safe outdoor spaces to play or accessible routes to walk or bike to school. Their neighborhoods may often be food deserts, having small food outlets and fast-food restaurants that sell and advertise unhealthy food and beverages, but lacking those with fresh and healthy foods at affordable prices. Thus, addressing the obesity epidemic is also a fight for health equity.”

The report, which is accompanied by charts and maps, illustrates how obesity rates vary across different regions, with West Virginia (and a preponderance of poor, South states) having the highest obesity rate among adults, at 37.7% Colorado, meanwhile, has the nation’s lowest with 22.3%. Mississippi wins the superlative for highest childhood-obesity rate at 21.7%, with Oregon owning the lowest, at 9.9%.

“Obesity rates vary state-to-state, but remain high nationwide. Across the United States, more than one in three adults and one in six children (ages 2-19) are obese — and one in 11 young children (ages 2-5) are obese. Adult obesity rates range from a high of 37.7 in West Virginia to a low of 22.3 in Colorado. Childhood rates are highest in Mississippi (21.7 percent) and lowest in Oregon (9.9 percent). Obesity rates also differ from county to county, and neighborhood to neighborhood.

More than 20 states have counties with adult obesity rates above 40 percent, including 29 counties in Mississippi and 14 counties in Alabama. Only two states have counties with adult obesity rates below 20 percent: 17 counties in Colorado and one in Massachusetts.”

Obesity is a massive drain on state Medicare programs…

“Each state and community is impacted by the cost of obesity — severe obesity alone costs state Medicaid programs between $5 million in Wyoming and $1.3 billion in California each year. Overall obesity related healthcare costs range from $279 per person per year in Wyoming to $768 in Oregon. Employers want to operate businesses in places with healthier populations — with a workforce that is more productive and has lower healthcare costs.”

…and workplace productivity…

“Obesity costs our nation more than $149 billion in healthcare costs each year. Indirect costs attributable to obesity also run in the billions due to absenteeism in school and jobs and reduced productivity. One study estimated indirect absenteeism costs to be as much as $6.3 billion annually.”

…it even impacts national security by having a deleterious effect on military readiness.

“Obesity is a national security issue. The obesity crisis also impacts our nation’s military readiness. Being overweight or obese is the leading cause of medical disqualifications, with nearly one-quarter of service applicants rejected for exceeding the weight or body fat standards. Obese service members and members of their family who are obese cost the military about $1 billion every year in healthcare costs and lost productivity. Mission: Readiness has found that more than 70 percent of today’s youth are not fit to serve in the military due to obesity or being overweight, criminal records, drug misuse or educational deficits.”

The study’s authors claim that the most effective policies to combat childhood obesity are implemented at the local level, and involve the cooperation of local institutions like schools, hospitals, universities and philanthropies.

“The most successful approaches are often comprehensive, localized, “place-based” efforts — where leaders and members of a community build partnerships that bring together public health and healthcare providers; hospitals, schools and universities; child-care providers and centers; social service groups; philanthropies; community-based, faith-based and community development organizations; and transportation and housing planners — to assess the priorities within the local area; leverage existing community resources; and determine the most effective, evidence-based strategies that can best meet their needs. Experts have identified a range of policies and programs that communities can implement to help make healthy eating and physical activity part of people’s daily routines, including improving school nutrition, complete streets initiatives, access to open space, incentives for healthy food purchases, food labeling and limits on advertising to children.”

For adult obesity, workplace wellness programs, insurance incentives, and making unhealthy food more expensive and inconvenient (i.e. taxing it) all appear to have some impact. While rates have largely stabilized since reaching all-time highs, the study warns that costs associated with obesity have not. As obese adults age, chronic health problems like diabetes will cause health-care costs to soar, making insurers already-fragile risk pools even more untenable.

Read the full report below:

TFAH 2017 ObesityReport FINAL by zerohedge on Scribd

 

"What The F*ck!": Rescued Woman Blasts CNN For Exploiting Hurricane Harvey Victims

Earlier today, CNN anchor Rosa Flores apparently chose the wrong mom to exploit in her futile effort to boost CNN ratings.

While it"s unclear exactly what happened off-air in the moments leading up to this interview, it became clear very quickly that this "shivering cold" mother of two exhausted children had no appetite for Flores shoving a "microphone in her face" to get a couple of sound bites for Jim Acosta"s show.

"We walked through four feet of water to get food on the first day.  Yeah, that’s a lot of shit.”

“But y’all sit here, y’all trying to interview people during their worst times — like that’s not the smartest thing to do. Like people are really breaking down and y’all sitting here with cameras and microphones trying to ask us what the fuck is wrong with us."

"And you really trying to understand with the microphone still in my face? With me shivering cold, with my kids wet, and you still putting the microphone in my face."

Not surprisingly, Kellyanne Conway immediately took to twitter to shame CNN for the failed interview.

Watch this clip to end.Shames @CNN to get the mike out of her face, notes her kids are shivering & in need of things other than an interview https://t.co/jGbvfJGecx

— Kellyanne Conway (@KellyannePolls) August 29, 2017

Of course, even though Conway"s tweet will be dismissed as a cheap shot, it does seem somewhat obvious from the jump that this mom is exhausted beyond belief and probably slightly more interested in finding some dry clothes for herself and her children than sharing her feelings with CNN.  That said, maybe we"re just really good at picking up on subtle social cues...

Meanwhile, the whole episode left Jim Acosta noticeably "triggered"...

Greeks Rejoice - Government Scraps Controversial Wine Consumption Tax

While austerity still reigns supreme over Greek society, amid resurgent refugee arrivals, still near-record high youth unemployment, record-high suicide rates, and a constant brain-drain exodus of young talent, this weekend saw a brief silver lining as the government decided to scrap the controversial special consumption tax on wine.

The measure, which not only did not meet revenue targets, but actually boosted illegal trade in wine and grapes, will be halted by the end of the year.

As KeepTalkingGreece reports, inaugurating the Wine Days of Nemea 2017 in one of wine producing regions of Greece, Minister for Rural Development, Vaggelis Apostolou said that the ministry is working on the legislation to scrap the special consumption tax on wine and it is expected to be ready before the end of the year.“It is a commitment by prime minister Alexis Tsipras that the tax will not exist in the new year,” Apostolou stressed.

Finance Ministry sources told daily Efimerida Ton Syntakton that the special consumption tax on wine caused more damage to the sector of wine producers than it brought revenues to the state.

In November 2015 and in terms of  additional modifications to the third bailout agreement, creditors and the Greek government had agreed to impose an  special consumption tax on wine, as the country’s lenders had decided they needed to collect an extra 300 million euros in indirect taxes per year. As this amount could not come from the grapes juice alone, they also imposed an extra tax on gambling.  Grapes  would bring €100 million, the gambling €200 million, creditors had calculated. Later they had modified their calculations down to 55 million euros per year.

The original proposal was that the extra tax would be 0.20-0.30 euro liter bottle, regardless of whether Greek or foreign wine.

Ultimately, the tax was 0.20 euro, some extra fees were added, a drop of tax here and a drop of fee there, the retail price reached 1 or 2 euros more per bottle for the consumer – although the average bottle has 700ml and not even one liter. In the magic world of Greek commerce, prices for average table wine of not worth mentioning quality ended up to be sold at €6.90 per bottle in the supermarket – from €4.90 before the tax.

The special consumption tax not only did not increase state revenues but literally backfired. It increased illegal trade in wine and grapes for wine making.

In 2016, the state collected less than 24 million euros from the extra consumption tax on wine. Instead of a permanent win from wine, the state in fact suffered a loss, if one takes into consideration the amount of money that did not land in state cash registers due to the illegal trade.

We are yet to hear what Germany thinks of this plan.

Owner Of The Plaza Hotel, Once Trump's Crown Jewel, Hires Broker To Pursue A Sale

Here’s some news that might interest the President.

The Indian owners of the Plaza Hotel have hired a broker to tell the New York City landmark, according to the Wall Street Journal. The step is “a sign that a world-wide scramble among investors, celebrities and governments to acquire the property could be nearing an end.”

Perhaps more than any other property (Trump Tower included), the Plaza Hotel is emblematic of Donald Trump’s meteoric rise in the world of New York City real estate. The hotel had for years been an object of fascination for Trump, who reportedly jumped at the opportunity to buy it from Texas billionaire Robert Bass in 1988. According to the New York Times, Trump paid $400 million for the hotel, an unprecedented sum for a hotel at the time.

However, it would also eventually become a symbol of his debt-fueled brush with ruin, as the property was eventually forced into bankruptcy in 1992; in 1995, he bitterly agreed to sell it to a group of Saudi investors.

More than 30 years after Trump was forced to sell it, industry experts believe the hotel could fetch more than $500 million. However, that sum isn’t even close to the highest ever paid for a NYC hotel: Back in 2015, China’s Anbang Insurance Group Co. bought the Waldorf Astoria for $1.95 billion to the highest price ever paid for a U.S. hotel, according to data tracker STR Inc. Now Anbang is being pressured to sell the Waldorf, along with its other foreign assets. Regulators are concerned that a foreign buying spree by Anbang and other Chinese conglomerates has left domestic corporations dangerously overleveraged.

“While it is unclear how much a buyer would pay for a trophy property like the Plaza, hotel investors and brokers suggest it could be one of the most expensive hotel sales on a per-room basis, a popular industry metric. By that method of valuation it could bring in more than $500 million.”

A representative of the company to told WSJ that a buyer has been found, and “a sale is under process and not yet competed.

Per WSJ, the list of potential buyers includes both the Qatari sovereign-wealth fund and Pras Michel, former member of the Fugees.

“Dozens of real estate moguls, foreign government funds and other hotel investors around the globe in recent years have looked into buying the Plaza after Sahara indicated it would listen to offers, according to people familiar with the matter.

A Qatari sovereign-wealth fund, a Shanghai municipal investment fund and Pras Michel, the Grammy-winning co-founder of the hip-hop group Fugees, are among those that have expressed interest, say people who have been close to the process."

Sahara Chairman Subrata Roy reportedly handled some of the negotiations while serving time in a New Delhi jail.

“Sahara founder and Chairman Subrata Roy, who spent two years in a New Delhi jail on contempt charges, even negotiated with potential buyers from the jail’s guesthouse, according to people familiar with the situation.”

According to WSJ, several interest parties walked away from talks early on because they didn’t think Sahara was serious about selling hotel (i.e. Sahara wouldn’t budge from its asking price, whatever it was). However, the hiring of a broker suggests that this time, they intend to close.

"Sean Hennessey, chief executive officer of the hotel consultants Lodging Advisors told WSJ that hiring a broker suggests that Sahara is, in fact, serious about pursuing a sale of its crown-jewel hotel.

“This suggests a commitment to consummate a transaction,” he said, adding that a professional broker handling the process “might draw people back that looked once and walked away.”

Because of its appearance in classic works of American film and cinema, the hotel has a cultural cache that few can match.

“It has been featured in novels like “The Great Gatsby” and numerous films, including Alfred Hitchcock’s “North by Northwest.” Marilyn Monroe and the Beatles stayed there. John F. Kennedy’s sister Patricia Kennedy held the reception after her wedding to Peter Lawford in the Plaza’s ballroom.

Previous owners of the 110-year old property include hotelier Conrad Hilton and Donald Trump, who once compared it to the Mona Lisa.”

Unfortunately for the Plaza’s owners, they’re selling at a difficult time for the Manhattan real-estate market. As we mentioned above, Chinese authorities are cracking down on foreign real-estate transactions to stanch capital outflows that have helped drain the country’s foreign reserves and put pressure on its currency, the yuan. The effects of these new regulations have already begun to manifest: The average Manhattan hotel sales price in the first half of 2017 was about $515,000, down 26% from the recent peak in the first half 2015, according to data company Real Capital Analytics.

According to a team of analysts at Morgan Stanley, the Manhattan real estate market is headed for a valley as purchases of foreign-real estate by Chinese companies are expected to decline by 84% in 2017, and another 18% in 2018. The influx of Chinese buyers in the aftermath of the financial crisis helped drive bull markets in hot urban markets like New York City, London and Hong Kong.
 

"Almost Cataclysmic": Barclays Reveals Which Restaurants Are Most Exposed To Collapsing Malls

We"ve spent a lot of time this year discussing the complete collapse of mall-based retailers, a collapse which has resulted in more store closures in Q1 2017 than all of 2016 and will likely claim more victims by the end of this year than any year since the great recession nearly a decade ago.  Here are a couple of recent examples:

But those mall-based apparel companies aren"t the only ones suffering the dire consequences of collapsing mall traffic.  For years, the casual dining space has become more and more saturated with new concepts resulting in thinner and thinner margins for the restaurant industry.  Now, with foot traffic in malls collapsing these same restaurants are about to experience the brutal realization that declining traffic, massive fixed costs, rising minimum wages and razor thin margins aren"t a great combo. 

Thankfully, Barclays" restaurant team, led by Jeffrey Bernstein, has identified which publicly-traded restaurants are about to get screwed the most.  Here"s a summary:

Of the large publicly-traded casual dining chains, Cheesecake Factory "wins" the "most screwed" award with 93% of their locations heavily dependent on mall traffic.

Meanwhile, proving they went full mall-tard (something you should never do, btw), CAKE"s second largest casual dining concept, Grand Lux, is also over 90% dependent on mall traffic. 

Here are more details from Barclays:

Cheesecake Factory (CAKE) operates 90%+ of their stores in a location we define as mall dependent. To be fair, CAKE is often viewed as a destination, with its own separate entrance, and therefore less mall-dependent. And most are in ‘A’ malls which house high-end retailers that draw a more affluent consumer. But the consumer shift to on-line shopping is less about affluence, and more about a change in behavior.

BJ’s Restaurants (BJRI) & Olive Garden (DRI) are the only other portfolio leading casual diners with an outsized percentage of stores mall dependent, at ~60% & ~50%, resp. With that said, we are Underweight BJRI & Overweight DRI. Importantly, this analysis is just one component of a mosaic when formulating our ratings. BJRI is expanding from regional to national, and competes within a very competitive varied menu segment, both of which pose challenges. Olive Garden is already a strong national brand, and the only one competing within the Italian segment, while offering a strong value platform.

As for the remaining casual diners, all operate 25-40% of their stores mall dependent. These include the three steak chains, Outback (BLMN), Texas Roadhouse (TXRH) and LongHorn (DRI), all at 30-40%. We are Overweight all three. Steak concepts are more special occasion, and therefore less mall-reliant, with resilience demonstrated by a positive comp for all in 1H17. Otherwise, Buffalo Wild (BWLD) is also Overweight. While comps have eased and wing prices are elevated, the brand is introducing a new c-suite, has three new activist board members, & potential for large refranchising / cost cutting. Lastly, Chili’s (EAT) also competes within a very competitive varied menu segment, and is viewed as over-stored, and is now looking to redefine a ‘very clear identity’.

Finally, here is a list of states that should probably start preparing for higher restaurant layoffs in the near future...yes, we"re looking at you and your $15 minimum wage California.

Thrill-Seeking Chinese Tourists Rush To Visit North Korea "Before The Regime Collapses"

While nearly two-thirds of Americans view North Korea as a “serious threat” and most would rather vacation literally anywhere else following the death of college student Otto Warmbier, Chinese adventure-seekers are visiting the North in ever-greater numbers, according to Reuters. The wave of tourism has been inspired by the fear that the latest escalation between Pyongyang and Washington might lead to the toppling of the Kim regime, which has successfully kept the forces of modernization at bay for decades, offering tourists a rare opportunity to catch a glimpse into the past that some say reminds them of a "young" China.

North Korea has become a favorite destination among wealthier, more adventurous Chinese travelers. Another tour operator who targets the affluent said he’s been fielding more questions about whether it’s safe to visit the North, Reuters reported.

"But those that inquire often already have their heart set on going," the operator, who declined to be named, told Reuters. "The idea of a bit of danger adds to the thrill and mystery of North Korea."

While the looming threat of nuclear annihilation is keeping some tourists at bay, more daring travelers say they are trying to visit the North before regime change brings the country into the 21st century, according to one tour guide.

"There have been quite a few tourists in my groups who say they want to see North Korea in its reclusive state while they can," he said.

"It won"t be the same if the regime collapses."

China stopped publishing national data about tourism to North Korea in 2012. But regional data show that more than 580,000 Chinese from the province of Dandong crossed the border into North Korea during the second half of 2016, more than the double the 237,000 Chinese who visited the country during 2012.

“China"s tourism authority has not published a breakdown of the total number of Chinese visitors to North Korea since 2012, when it said 237,000 made the trip.

But the number traveling just from Dandong spiked to 580,000 in the second half of 2016 alone, according to the state-run China News Service. The report said 85 percent of Chinese tourist visits to North Korea originated from Dandong.

That"s still only a fraction of the 8 million Chinese who visited South Korea in 2016.”

According to Reuters, tourists can take ferries or charter speedboats down the Yalu River – the border between the North and China – to catch a glimpse of North Korea villages and the heavily armed guards who patrol the border.

Other fun activities include paying respects to a statue of Kim il-Sung.

“A flyer for the one-day tour to Sinijiu tout a trip to the city’s central plaza, where you can pay respects to a bronze statue of North Korea"s founding president Kim il-Sung, as well as visits to a cosmetics factory, a revolutionary history museum, art history museum and a cultural park.

"You can feast on the North Korean specialty food by warm and hospitable North Koreans," it says.

As we reported last month, trade between China and North Korea expanded by 10% during the first half of the year, as have the number of border crossings. Meanwhile, traffic, especially on lower-end group tours, has grown steadily to one of the world"s most isolated states over the past few years, despite North Korea"s persistent nuclear and missile tests, which have elicited increasingly tight U.N. sanctions.

Few of the Chinese who spoke to Reuters were concerned about the North’s missile tests, or the economic sanctions imposed by the UN. Most said they saw the opportunity to visit a “piece of history” as too attractive to pass up.

“Undeterred by escalating tensions between Pyongyang and Washington rattling nerves globally, a steady stream of tourists from China each morning passes through the immigration checkpoint at the border trading hub of Dandong.

Greeting them on the North Korean side are dozens of tour buses, collecting them for itineraries ranging from a day in neighboring Sinijiu to a week visiting North Korea"s main cities, including the capital Pyongyang.

 "We"re curious. We want to see how they live," Xu Juan said on Thursday before crossing the Yalu River, which marks the border between the two countries. Xu was traveling with friends and family from Hangzhou, in eastern China.

"I just want the sense of nostalgia, to see a country that is poor, like (China was) when I was young," said a man in his early 50s, from Jilin province, declining to give his name.”

If the Chinese government has its druthers, the North’s status as a living wax museum likely won’t change any time soon: According to an article in the Global Post, the Communist Party has vowed to step in if the US or South Korea tries to topple the Kim regime.

Though no official US records are available, it’s believed that hundreds of adventure-seeking US tourists would visit North Korea every year. Typically, they would arrange tours through Switzerland, or sign on with a Chinese tour company based near the border. However, relations between the two countries have deteriorated to such a degree that any US tourist crazy enough to visit the North should get it over with soon: The State Department has banned US passport holders from traveling to the North after Sept. 1.

For any American hoping to visit a foreign country ruled by a hostile government, we hear Eritrea is beautiful in the fall.
 

Overworked, Underpaid, & Overweight

It"s a triple-whammy - Americans are overworked, Americans are underpaid, and, now, potentially as a result of these, Statista"s Isabel von Kessler writs that Americans are overweight - over 2 in 5 American workers have put on pounds at their present job.

A survey by Harris Poll on behalf of CareerBuilder, asked workers what they thought contributed most to weight gain at their current workplace.

At least 51 percent thought sitting at a desk most of the day was the main reason.

You will find more statistics at Statista

While sports could counterbalance the desk jobs, 45 percent stated they were too tired to exercise after returning home. 38 percent blamed stress-related eating for increasing pounds.

Accordingly, 25 percent of all workers say they"ve gained more than 10 pounds at their present job, while 1 in 10 gained more than 20 pounds.

Houston is the city with the highest share of weight gaining workers (57 percent), Washington D.C. follows suit (50 percent) and Dallas comes third (47 percent).

Tech Wreck 2.0? FANG Stocks Suddenly Slammed, Nasdaq Dives, VIX Spikes Above 10

VIX is suddenly spiking higher (back above 10) and stocks lower - amid no obvious catalyst...

Nasdaq is tumbling...

As Dow Transports suffer their second biggest drop in 10 months...

And FANG Stocks dive...

NFLX and GOOGL are the big laggards today/this week...

We note that Bloomberg reported earlier that gains for Facebook and Amazon.com account for about two-thirds of the S&P 500’s 5 point gain.

Do Algos read Howard Marks?