THOUGHTS ON ECONOMIC OPPORTUNITY, SOCIAL JUSTICE & SECURITY
DE-RISKING MOVES IN THIS PRESENT ENVIRONMENT
The US major markets are on a great run lately, hitting one record after another. However, many investors including Warren Buffett have been quoted as saying that the equity markets (stocks) are overvalued. In response to the present market conditions, money managers have started deploying defensive strategies to reduce their exposure to risk in the event of a market downturn.
Economists and money managers have made the observation that the plunging oil prices may indicate global economic contractions as low energy demand usually represents slowing economies. On an April 23 letter by Steven Whiting, Global chief investment strategist at Citi Private Bank he disclosed to investors his reduced exposure: “we have reduced our overweight position in U.S. large capitalization equities from +3% to +2%. This reduces the overweight to one that is somewhat below the U.S. share of global market capitalization, near 50%.” Singling out the effects of energy, he points to the “consequences of the boom and bust in U.S. energy investment as a factor that is contributing to weakening of U.S. equity outperformance.”
INDIAN ANCESTRAL LAND CLAIM
The cause for action in this case has its roots in events that occurred 146 years ago. As alleged, in 1859 the State of New York enacted a law that allowed the conveyance of the Indian Nation’s land to the government of the Town of Southampton. The case was filed in the US District Court for the Eastern District of New York on June 2005 by plaintiff Shinnecock Indian Nation (“Nation”) seeking the vindication of its rights, damages and possessory rights of the disputed lands.
The district court dismissed the Nation’s claim stating that “laches” barred the claim. “Although the court acknowledged that the “wrongs” alleged by the Nation were “grave,” it emphasized that the Nation had not occupied the disputed lands since 1859. In the court’s view, the “disruptive nature” of the Nation’s land claims was sufficient to “tip the equity scale in favor of dismissal.” As of this writing, the case is on appeal at the US Court of Appeal, Second District.
The Indian Nation subsequently filed a claim in the Court of Federal Claims alleging that the United States, “acting through the federal court system . . . denied any and all judicial means of effective redress for the unlawful taking of lands from [the Nation] and its members.” The Nation sought $1,105,000,000 in money damages, legal fees etc. “In its complaint, the Nation asserted that in failing to provide it with a remedy for the misappropriation of its tribal lands, the United States violated trust obligations arising under both the Non-Intercourse Act, 25 U.S.C. § 177, and the “federal common law.”
The case arrived at the US Court of Appeals for the Federal Circuit after the district court dismissed the claim, holding that “… the Nation’s claims were not ripe for adjudication because they were predicated upon the district court’s judgment in the Land Reclamation Suit and that judgment was on appeal.”
The circuit court first considered the issue of “Ripeness” and relied on well established case laws: “Ripeness is a justiciability doctrine that “prevent[s] the courts, through avoidance of premature adjudication, from entangling themselves in abstract disagreements . . . .” Abbott Labs. v. Gardner, 387 U.S. 136, 148 (1967), abrogated on other grounds by Califano v. Sanders, 430 U.S. 99 (1977). Determining whether a dispute is ripe for review requires evaluation of: (1) the “fitness” of the disputed issues for judicial resolution; and (2) “the hardship to the parties of withholding court consideration.” Id. at 149; see Sys. Application & Techs., Inc. v. United States, 691 F.3d 1374, 1383–84 (Fed. Cir. 2012).”
The circuit court paid special attention to the “Non-Intercourse Act” asserted by the Nation, which provides: “No purchase, grant, lease, or other conveyance of lands, or of any title or claim thereto, from any Indian nation or tribe of Indians, shall be of any validity in law or equity, unless the same be made by treaty or convention entered into pursuant to the Constitution.” 25 U.S.C. § 177.”
Clearly, the issue could not be considered on its merits until it is settled by the 2nd Circuit Court. However, the circuit court offered an analysis on the issue of deprivation, holding: “The Nation alleges that in applying the doctrine of laches to bar its land claim, the district court improperly “took away the Nation’s legal right to sue for compensation for its stolen land.” The Court of Federal Claims, however, is without authority to adjudicate the Nation’s claim that it suffered a compensable taking at the hands of the district court.”
“Accordingly, we affirm the United States Court of Federal Claims’ determination that the Nation’s breach of trust claims are not yet ripe for review, vacate its ruling that it lacked jurisdiction over those claims, and remand the case with instructions to dismiss the breach of trust claims without prejudice.”
“AFFIRMED IN PART, VACATED IN PART, AND REMANDED”
NOTE: Latches is defined as the “unreasonable delay pursuing a right or claim… in a way that prejudices the [opposing] party”.
100 YEARS AGO: THE GALLIPOLI CAMPAIGNS
World War I broke out in Europe on the 28th of July 1914. By November of that year the Ottoman Empire (modern day Turkey) joined the Central Powers of Germany, Austria-Hungary and Bulgaria and posed a threat in the Middle East including the strategically valued Suez Canal. Viewed as an important shipping lane between Europe and Asia a contingent of British and Commonwealth forces were first posted in Egypt to guard the canal. When the threat did not materialize, a plan was made to seize control of the Dardanelles Strait, a body of water in northwestern Turkey connecting the Aegean Sea to the Sea of Marmara. With a beachhead secured, military planners intended to capture the capital city of Constantinople and take The Ottoman Empire out of the war.
Under the leadership of Winston Churchill, First Lord of the British Admiralty, an offensive bombardment on the Gallipoli Peninsula by British and French naval ships was initiated on the 19th of February 1915, destroying a number of fortified Ottoman positions. The first advance was, nevertheless, hindered by heavy fire. On the 18th of March 1915 battleships were ordered to enter the strait and met with undetected mines and hostile enemy fire. Three ships were sunk and three more were damaged.
In the face of the naval disaster, the allies dispatched an invading force, landing on the Gallipoli Peninsula on the 25th of April 1915. The Mediterranean Expeditionary Force (MEF) consisted of approximately 75,000 men from Great Britain, Ireland, France, India, Newfoundland, Australia and New Zealand. The landing parties were able to take beachheads but the intense fighting immediately degenerated into trench warfare. To break the stalemate, another landing party was dispatched to the north at Suvla Bay on the 6th of August 1915. The troops met with limited success and only bolstered the defenses when more troops were sent by the Ottoman Empire and Bulgarian artillery units joined the fighting.
By the following year it became clear to the allied military planners that they had underestimated the resolve of the opposing forces and abandoned the plans to take the capital city of Constantinopole. The Battle of Gallipoli lasted 8 months, 2 weeks and 1 day (25 April 1915 – 9 January 1916). The heavy fighting, inclement weather, disease and other causes accounted for approximately 218,000 to 251,000 casualties, including approximately 131,000 killed: 87,000+ Central forces and 44,000+ Allied forces.