Race and Real Estate, TTIP Stumble, Dirty Russian Money in U.K.

By Peter Ward     May 6, 2016

Housing Prices and Race Examined

Is there a link between race and real estate values? An interactive published by the Washington Post on Monday suggests that the two are correlated in some cities.

The article focuses on DeKalb County in Georgia, just outside Atlanta, where a house on the south side of the county might sell for half of one in the north. The only discernible difference between the two areas is the percentage of African Americans in each community, according to an economic development consultant and real estate agent.

“This can’t happen by accident,” Wayne Early says. “It’s too tightly correlated with race for it to be based on something else.”

The first graphic in the article shows the difference in house prices in different zip codes across the Atlanta area. Values have decreased since 2004 in almost all zip codes where the population is at least 40% African American. Across the whole country, home values in predominantly African American neighborhoods have been less likely to recover to the prices of 2004 following the real estate crash in 2008, according to analysis from Black Knight Financial Services.

The disparities are not just due to lower incomes, higher poverty levels or lower quality homes in African American neighborhoods, according to economists studying the DeKalb County region. The differences in house prices still exist in South DeKalb, where black families make six-figure incomes.

The next graphic allows readers to enter any zip code in the U.S. and see the changes in home value since 2004.  Another line graph displays clearly the difference between predominantly white neighborhoods in DeKalb County and African American communities. In some neighborhoods with less than one-third black populations, house prices have increased as much as 38.4% since 2004, while house prices in zips with more than two-thirds black populations have decreased up to 26% over the same period.

U.S.-E.U. Trade Deal Difficulties Explained

A trade agreement between the E.U. and the U.S. could be in serious trouble. Although President Obama said last week that he was confident a deal would be reached on the Transatlantic Trade and Investment Partnership (TTIP), leaked negotiating texts suggest the two parties are far from an agreement, and European leaders have already begun to back away from the deal.

The TTIP would synchronize regulations across a large number of business sectors, and could provide a boost to exporters in the U.S. and Europe. The deal, which must be approved by all 28 countries in the E.U., could bring up to $137 billion in gains to the E.U., and around $109 billion for the U.S., according to the Centre for Economic Policy Research, a European economic think tank.But documents exposed by the environmental group Greenpeace show U.S. demands could weaken the E.U.’s environmental regulations.

Jorgo Riss, the director of Greenpeace EU, told The Guardian: “These leaked documents give us an unparalleled look at the scope of U.S. demands to lower or circumvent E.U. protections for environment and public health as part of TTIP. The E.U. position is very bad, and the U.S. position is terrible. The prospect of a TTIP compromising within that range is an awful one. The way is being cleared for a race to the bottom in environmental, consumer protection and public health standards.”

France’s trade minister Matthias Fekl described the TTIP in its current form as a “bad deal” and said talks are likely to grind to a halt.

U.K. Banks and Russian Fraud

Investigative journalists are often advised to follow the money. An investigation published by Buzzfeed News on Tuesday did exactly that, and found U.K. banks and firms handled £20 million (around $29 million) connected to a Russian fraud case.

Financial records seen by Buzzfeed News suggest money spent on yachts, private schools and other services originated from companies linked to a $230 million fraud against Hermitage Capital Management, a hedge fund, and the Russian Treasury.

The new evidence has prompted calls for a criminal investigation in the U.K. into the alleged fraud and subsequent money laundering. The case is already fraught with potential political scandal, following the 2009 death in a Russian prison of Sergei Magnitsky, a Russian lawyer investigating the alleged fraud on behalf of Hermitage.

Another witness, Alexander Perepilichnyy, was found dead in the U.K. in unexplained circumstances in 2012, shortly before he was due to testify in Switzerland. According to Buzzfeed, 11 countries have launched fraud or money laundering investigations connected to the case. The article also features a graphic displaying the flow of money from the Russian treasury into several companies.

Magician Makes $70m a Year

How does one man use magic to make $70 million a year? That’s the question asked in Businessweek’s feature on Criss Angel, a Las Vegas magician pulling in astonishing amounts of cash for his calling.

Angel lives in a $22 million, 25,000 square foot, estate 20 minutes from the strip in Vegas, and owns several supercars, according to the article, and it’s all from magic. The entertainer makes his money from television, roadshow versions of his act, merchandise, and sponsorships.

Paul Barrett’s article examines how Angel’s story coincides with the changing nature of Las Vegas tourism, which has shifted away from gambling and towards big money entertainment acts. Last year, there were 42 million visitors to Vegas, up 2% from 2014, but casino revenue fell 2.5%. Gambling accounted for 60% of Vegas tourism 20 years ago, according to William Thompson, professor emeritus at the University of Nevada. In 2015 the figure was 35%.

Vegas casinos have struggled due to the legalization of gambling elsewhere in the U.S. and the recession which began in 2008. To bridge the gap, The Strip turned to nightclubs and entertainers like Celine Dion, Blue Man Group and Angel.

Angel’s story shows he clearly worked hard for his money, after starting out in a Halloween convention in New York’s Madison Square Garden and building a huge empire from there. This summer he will perform 12 shows in Dubai that will earn him $2 million, after expenses.

This Week’s Top Headlines

Tesla puts pedal to the metal, 500,000 cars planned in 2018 – Kshitiz Goliya, Alexandria Sage, Reuters

‘Deadpool,’ ‘People v. O.J. Simpson’ Help Fox Beat Quarterly Revenue, Earnings Expectations – James Rainey, Variety

AB InBev Profit Dips on Weak Brazil Sales – Tripp Mickle, Natalia Drozdiak, The Wall Street Journal

Tribune Board Rejects Gannett’s $815 Million Takeover Proposal – Paul Barbagallo, Bloomberg News

European Central Bank to withdraw €500 note – BBC

You should be able to file class-action suits against banks, watchdog group says – James Rufus Koren, LA Times

Jobless Claims in U.S. Increase to Highest Level in Five Weeks – Michelle Jamrisko, Bloomberg News

Druckenmiller: Get out of the stock market, own gold – Tae Kim, CNBC

Alibaba Sales Up 39% on Increased Consumer Spending in China – Paul Mozur, The New York Times

Bitcoin ‘creator’ backs out of Satoshi coin move ‘proof’ – BBC

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