Business
The Shifts in the Markets Are Enough to Make Your Head Spin
Bond funds misplaced 4.2 p.c, on common, with long-term funds recording double-digit declines.
Marko Papic, chief strategist on the Clocktower Group, an asset supervisor, agreed with Mr. Thompson that “the extra the inventory market ignores Fed hawkishness, the extra seemingly they’re going to go laborious early.” However Mr. Papic expects the Fed to decide on later within the 12 months to tolerate persistent inflation to attempt to forestall a recession.
Mr. Papic advises buyers to “shift into worth now” by shopping for shares of commodity producers and in international locations, equivalent to Brazil and Chile, that export commodities. The dominance of mining in these international locations’ economies might clarify a lot of the current sturdy efficiency that Morningstar famous amongst Latin America funds.
The Russia-Ukraine Conflict and the International Financial system
If the Fed doesn’t go forward with an aggressive method, inflation-adjusted bond yields “are going to be very low, so commodities will go greater,” he mentioned. He acknowledged, although, that placing cash into commodities is dangerous, and added, “If I’m flawed and there’s a recession, they’ll get killed.”
Within the present atmosphere, he continued, progress shares, particularly massive and costly expertise blue chips like Microsoft and Apple, could also be harmful to personal. They began to fall from favor earlier than the pandemic, “after which Covid allowed tech corporations to convey ahead a decade of buyer progress,” Mr. Papic mentioned. “We’re on the limits of that outperformance.”
The outlook for tech shares might hinge on the outlook for rates of interest. Tech shares are likely to react badly to greater charges as a result of these corporations are dearer than others to start out with, and better rates of interest are likely to depress inventory valuations typically. Additionally, greater charges usually come when the financial system is robust and the flexibility of tech corporations to develop when different sectors can’t issues much less.
A extra aggressive Fed, even when only for a number of months, means greater charges, and Mr. Brightman highlighted a development, pushed by heightened geopolitical danger, that will preserve charges greater for much longer: “slowbalization,” as he put it, a decline, and even reversal, of the system of freer commerce that has created monumental wealth for buyers.
A brand new urgency to make sure steady, safe provide chains might compel corporations to shift manufacturing nearer to residence, he mentioned. Constructing manufacturing capability would require capital, pushing up rates of interest and, as a result of it prices extra to make a widget in Secaucus than Shenzhen, inflation, too.
Business
Crafting a Haggis for American Tastes (and Import Restrictions)
When Scottish Americans and Scottish expats sit down on Saturday night to celebrate the birthday of the 18th-century poet Robert Burns, the traditional haggis will probably not be up to purist standards.
Haggis, the savory Scottish dish of boiled sheep innards, oatmeal and spices, can be a real haggis, many argue, only if it includes a key ingredient: sheep lung, which is used in the stuffing. In the United States, which bans imports of haggis with sheep lung, some Americans of Scottish heritage have turned to the black market to get their hands on the real thing.
Now Macsween, one of the more popular makers of haggis in Scotland, has developed a recipe that would meet U.S. import guidelines by replacing sheep lung with lamb heart. It’s not the first modification that Macsween, which was founded in Edinburgh in 1953, has made to its haggis. In a nod to modern tastes, it has swapped the sheep stomach that has traditionally been used as a haggis casing for a beef casing, like those used in some sausages.
“Do I think there’s something to be said for textural difference that the lung adds to it? Yes,” said Greg Brockman, a butcher in Brooklyn who has made his own version of haggis for years. “Do I think the average consumer is going to notice? Probably not.”
The new take on the delicacy is slated to arrive in the United States by this time next year, in time to be the centerpiece at Burns Night celebrations.
Burns helped turn haggis, which was traditionally consumed by peasants, into Scotland’s national dish with lines like “Fair fa’ your honest, sonsie face / Great chieftain o’ the pudding-race!” in his poem “Address to a Haggis,” which is read as part of the celebrations.
While a mere mention of the delicacy can draw winces from Americans, James Macsween, the managing director of his family business, sees possibility far beyond Burns Night.
“A lot of people eat this on a week-by-week basis,” he said. “We have done all the hard work: We have ground it, blended it, mixed it, seasoned it and made it into a very nutritious and tasty meat protein ingredient.”
Take the casing off, Mr. Macsween said, and add the stuffing as a topping or ingredient in haggis pizza, haggis lasagna or haggis poutine.
“You can make hundreds of menu suggestions,” he said. “It’s the versatility.”
Macsween sells about eight million pounds of haggis every year in Britain, where the recipe includes sheep lung. Its biggest client is the grocery and department store chain Marks & Spencer. Mr. Macsween said the haggis market is worth about 14 million pounds, or about $17.5 million.
Breaking into the U.S. market has been a challenge. Haggis was banned in the United States in the 1970s because of the ban on lung sales. In 1989, the United States banned lamb and beef imports from Britain after an outbreak of bovine spongiform encephalopathy, otherwise known as mad cow disease.
Mr. Macsween said he had been trying to enter the North American market since 2015, when he began representing the Scottish haggis and meat manufacturing industry in talks with the Canadian and U.S. governments to try to put Scottish lamb and beef back on menus across the Atlantic.
The United States relaxed its restrictions on lamb and beef imports in 2022, but because of the ban on lung sales, one thing was clear: If Macsween’s haggis were to be sold in America, it would have to substitute lamb heart.
American-made haggis is “perfectly acceptable,” Mr. Macsween said. But now, he says, it’s time to “finally get genuine Scottish haggis into the United States.”
Macsween will use the same recipe for American-sold haggis as it does in Canada, now one of its biggest markets. That includes lamb heart and fat, oatmeal, white and black pepper, aromatic herbs, salt, onion and broth.
“We know it works,” Mr. Macsween said. “It’s a tasty product, and it’s the most authentic haggis we can make within the legislation.”
Anne Robinson, the founder of Scottish Gourmet USA in Greensboro, N.C., isn’t so sure. Her company is one of the largest purveyors of domestically made haggis in America (made with ground lamb and beef liver, venison or vegetables), and she questioned whether Macsween would be able to get around the U.S. regulations. Still, she welcomed the company to what she described as “a highly specialized market.”
Mr. Brockman, the butcher in Brooklyn, lived in Scotland for four years and remembered having Macsween haggis for Burns Night celebrations with friends. Now he makes his own at Prospect Butcher Company, using uses sheep heart and liver. He usually sells about 20 pounds of it around Burns Night.
“Everyone fears it as this emblematic weird food,” he said. “But it has a wonderful mix of warm spices and there is some of that iron tang to it from the heart and liver. I don’t think it’s at all overpowering. It’s just a nice mound of food, man. It’s not appealing in shape or color, but it tastes really good and smells really good.”
Business
Column: A Trump judge dropped his unwavering support for birthright citizenship to conform to Trump's view
Over his seven years on the federal bench, James C. Ho has acquired a reputation as one of the most conservative members of a notably conservative court, the U.S. 5th Circuit Court of Appeals.
So it’s proper to take heed of Ho’s position on a temporarily blocked issue that Donald Trump has lately placed on the front burner: Birthright citizenship, the principle enshrined in the 14th Amendment that virtually all children born in the U.S. are U.S. citizens.
In an executive order issued on inauguration day, Jan. 20, Trump declared that the right of birthright citizenship doesn’t apply to the children of undocumented immigrants. Trump’s order was temporarily blocked Thursday by a federal judge in Seattle.
Text, history, judicial precedent, and Executive Branch interpretation confirm that the Citizenship Clause reaches most U.S.-born children of aliens, including illegal aliens.
— James C. Ho, 2006
Among legal scholars, that’s a minority view, even a fringe view. The 14th Amendment is forthright; it states, “All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States.”
Ho has long voiced the broadest view of those words. But not lately.
Let’s trace his intellectual journey on the issue.
Ho, as it happens, is an immigrant himself. He was born in Taiwan to parents who immigrated to the U.S. when he was a child and acquired naturalized U.S. citizenship at age 9.
No one to my knowledge has ever argued that the children of invading aliens are entitled to birthright citizenship.
— James C. Ho, 2024
Ho’s judicial stance has been solidly conservative. Last year, writing in a case in which his colleagues reversed a ruling by a federal judge in Texas that had blocked the distribution of the abortion drug mifepristone nationwide, Ho engaged in what I called a “curious flight of fancy” to advocate for the ban.
He asserted that abortions cause “aesthetic injury” to doctors forced to participate in the procedure, even if only by treating patients for adverse reactions.
“Unborn babies are a source of profound joy for those who view them,” Ho wrote. “Doctors delight in working with their unborn patients — and experience an aesthetic injury when they are aborted.” He argued in favor of granting the physician plaintiffs in the case a legal interest in the outcome of abortions achieved via the drug, even though none of the plaintiffs had treated women who had taken it.
“The [Food and Drug Administration] has approved the use of a drug that threatens to destroy the unborn children in whom Plaintiffs have an interest,” Ho wrote. “And this injury is likewise redressable by a court order holding unlawful and setting aside approval of that abortifacient drug.”
Ho’s earliest writing on the birthright citizenship that I could find was published in 2006 in The Green Bag, a law journal. At the time, Ho’s career encompassed service as a counsel to the Senate Republican caucus and service as a clerk to Supreme Court Justice Clarence Thomas. He would later serve as solicitor general of Texas, before his appointment to the 5th Circuit appeals court by Trump in 2017.
In his 2006 article, titled “Defining ‘American,’” Ho focused specifically and at length on the argument that children of undocumented immigrants aren’t entitled to birthright citizenship.
Birthright citizenship, he wrote, “is protected no less for children of undocumented persons than for descendants of Mayflower passengers.”
Ho dismissed the assertion by critics of birthright citizenship that the phrase “subject to the jurisdiction” excludes those who are in the U.S. illegally.” Even they, he wrote, are subject to the authority of the U.S. government, and therefore covered by the citizenship clause. He endorsed the most common interpretation, which is that the “jurisdiction” clause excludes only the children of diplomats serving their home countries in the U.S., and enemy combatants on U.S. soil. Instead, he wrote, the citizenship clause “covers the vast majority of lawful and unlawful aliens.”
Ho wrote again on birthright citizenship in a Jan. 5, 2011, op-ed in the Wall Street Journal. The article addressed an effort by a coalition of red state legislators in support of state-level laws to exclude undocumented immigrants from birthright citizenship. It was subtitled, “Opponents of illegal immigration cannot claim to champion the rule of law and then propose policies that violate our Constitution.”
In that article, Ho reviewed the long history of legal and judicial support for the broad reach of birthright citizenship. As I reported this week, that included an 1898 Supreme Court decision upholding the citizenship of an American citizen of Chinese extraction, and Supreme Court rulings in 1982 and 1985 in which the court “unanimously agreed that a child born to an undocumented immigrant was in fact a U.S. citizen,” as Ho wrote.
Now let’s fast-forward to Nov. 11, days after Trump’s reelection victory. In an interview published by Reason Magazine that Ho gave to conservative lawyer Josh Blackman — who himself supports birthright citizenship for children of undocumented immigrants — Ho backtracked.
“Birthright citizenship obviously doesn’t apply in case of war or invasion,” Ho stated. “No one to my knowledge has ever argued that the children of invading aliens are entitled to birthright citizenship. And I can’t imagine what the legal argument for that would be…. Everyone agrees that birthright citizenship doesn’t apply to the children of lawful combatants. And it’s hard to see anyone arguing that unlawful combatants should be treated more favorably than lawful combatants.”
There’s a lot to unpack here, but Ho certainly seems to be conjuring up a redefinition of “illegal” or undocumented immigrants as “invaders.” He appears to find some equivalence between undocumented immigrants and “invading aliens.” Ho articulated this view in a concurring opinion in an appellate ruling in July that supported efforts by Texas Gov. Greg Abbott to have state officials block immigrants at the Texas border. Ho argued that Abbott’s assertion that Texas faced an “invasion” of illegal immigrants from Mexico deserved respect as a “good faith” description of conditions, and that the state arguably had the right to take matters into its own hands.
That’s a view in which Ho may be in a minority of one. In a 1996 case, a federal appeals court panel ruled that for a state to claim it’s being invaded, “it must be exposed to armed hostility from another political entity, such as another state or foreign country that is intending to overthrow the state’s government”—not a flow of individuals seeking jobs.
In his Reason interview, Ho’s definition of “unlawful combatants” is murky, but his free use of the term “invasion” conforms to the observation of legal scholar Rachel Rosenbloom that opposition to birthright citizenship is typically couched “in a highly racialized language of crisis and invasion.”
Why did Ho change his tune, if that’s what he’s done? Paul Blumenthal of Huffpost speculates that Ho’s “rewriting of his previous position on birthright citizenship can be best seen as his audition for the next open Supreme Court seat,” which is likely to be filled by Trump.
I asked Ho via a message to be forwarded to him by his chambers clerk to comment on that conjecture and to clarify his views on birthright citizenship, and how they might have been changed by rhetoric about an “invasion” of Texas or the U.S. by immigrants. He hasn’t replied.
Business
Fitbit Agrees to Pay $12 Million for Not Quickly Reporting Burn Risk With Watches
Reports that Fitbit’s Ionic smartwatch was overheating began in 2018 and continued into 2020. But according to U.S. officials, the company did not quickly report, as the law requires, that the battery inside the watch was creating an unreasonable risk of serious injury or death to consumers.
On Thursday, the U.S. Consumer Product Safety Commission announced that Fitbit had agreed to pay a $12.25 million civil penalty over its delay in reporting that the lithium-ion battery in the watch can overheat, creating a burn hazard.
The commission noted that in early 2020, Fitbit had issued a firmware update to reduce the potential for battery overheating, as consumers continued to report suffering burns because of the watch. But Fitbit did not voluntarily recall the Ionic smart watch until March 2, 2022.
By then, the commission said, Fitbit had received at least 174 reports globally of the lithium-ion battery’s overheating, leading to 118 reported injuries, including two cases of third-degree burns and four of second-degree burns.
“Fitbit should have immediately reported numerous overheating incidents, including second- and third-degree burns,” Commissioner Rich Trumka Jr. said Thursday in a statement. “Instead, Fitbit broke the law by delaying its reporting, leaving consumers exposed to the burn hazard. Many of these injuries could have been prevented.”
In a statement on Friday, a Fitbit spokesman said, “Customer safety continues to be our top priority, and we’re pleased to resolve this matter with the C.P.S.C. stemming from the 2022 voluntary recall of Fitbit Ionic.”
About one million of the devices, which track activity, heart rate and sleep, were sold in the United States from September 2017 through December 2021, with an additional 693,000 sold globally. Fitbit said that the injury reports represented fewer than 0.01 percent of all Ionic watches sold. The company stopped production of the Ionic in 2020, according to the consumer commission.
At the time of the 2022 recall, owners were offered $299 after returning their Ionic watches and received a discount code for select Fitbit devices, according to the consumer commission.
As part of the settlement agreement, Fitbit agreed to submit an annual report, including updates on the effectiveness of its revamped compliance policies.
Google bought Fitbit for $2.1 billion in early 2021 after agreeing not to use the health and wellness data that Fitbit had created to target ads at internet users.
In 2014, Fitbit recalled more than a million of its Force wristbands after customers complained of severe skin irritation.
But the company avoided a recall of its Flex wristbands later that year, after similar complaints, by adding a warning about nickel allergies and a sizing guideline to prevent users from wearing the wristbands too tightly.
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