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Week in Review

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08/26/2017

For the week 8/21-8/25

[Posted 11:30 PM ET, Friday]

Note: StocksandNews has significant ongoing costs and your support is greatly appreciated.  Please click on the gofundme link or send checks to PO Box 990, New Providence, NJ 07974.  Special thanks to longtime supporter Jim D. 

Edition 959

Another extraordinary week...and far from a good one when you factor in Hurricane Harvey, which appears to be next week’s lead if the computer models are correct.

I have plenty to say about our president, and the news he dumped on us tonight is interspersed throughout.  Recognize I obviously don’t have time to comment fully on each of tonight’s items, except to say his tweets on the hurricane have been beyond insipid.

I’ll just say for now that I was embarrassed by Trump’s performance in Phoenix, while at the same time recognizing his 35% base isn’t leaving him. I understand.  I don’t agree, but I get it, putting my poli-sci hat on.

But if you wanted a divider-in-chief, well, you got him.  How this is good for America, in both the short and long term, feel free to tell me.  

I start out with Afghanistan, however, and I have no problem with the president’s strategy.  Yes, the speech was lacking in detail, but I’ve never been in the cut-and-run camp when it comes to this one.  I like how both the Wall Street Journal and Washington Post editorial boards sum it up below.  Afghanistan is likely to be no different than what we’ve had for decades in Europe, the Gulf, and on the Korean Peninsula.  If you want all of these forces to come home in the belief we’d then be singing Kumbaya the rest of our lives, exchanging warm pies with our neighbors, you’re sadly mistaken.

The world sucks...film at eleven.

But what I’m worried about in the next month or so, aside from any mischief from Kim Jong Un, is what Vladimir Putin will do when he commences his massive war games in Russia and Belarus in September, and whether he leaves large numbers of troops behind after completion to menace the border countries, or actually makes a move on one.

This is going to be a crazy fall.  Chinese President Xi Jinping, one of the truly bad people on the planet, will be solidifying power at the Communist Party Congress, and I believe he’ll ask not just for a second five-year term, but a third, while further consolidating power, and repressing his people.  If I were Taiwan, I would not be sleeping comfortably.

But for now, I’m going to keep reporting the facts as best I can, while mixing in a little opinion.  And so we begin....

Trump World...Afghanistan....

Monday night, in a sober speech to the American people from Fort Myer, Va., President Trump assured us that the United States will win the war in Afghanistan.

“The American people are weary of war without victory. I share the American people’s frustration,” but “in the end, we will fight and we will win.”

The president declined to commit to a specific troop increase amid rumors of one of nearly 4,000 from a stated 8,400 (more on this below), with the existing forces on a dual mission of training, advising and assisting Afghan forces, while conducting counterrorism missions against groups such as al Qaeda and ISIS.

“A core pillar of our new strategy is a shift from a time-based approach to one based on conditions. I’ve said it many times how counterproductive it is for the United States to announce in advance the dates we intend to begin, or end, military options.”

Trump acknowledged he was reversing course.

“My original instinct was to pull out, and historically I like following my instincts, but all of my life I’ve heard that decisions are much different when you sit behind the desk in the Oval Office,” he said.

“A hasty withdrawal would create a vacuum that terrorists – including ISIS and Al Qaeda – would instantly fill, just as happened before Sept. 11.”

Trump dubbed his new approach, “principled realism.”

“I share [Americans’] frustration over a foreign policy that has spent too much time, energy, money, and most importantly lives trying to rebuild countries in our own image instead of pursuing our security interests above all other considerations,” Trump said.

“Ultimately it is up to the people of Afghanistan to take ownership of their future... We are not nation building again. We are killing terrorists,” he added.

As for Pakistan, Trump vowed to pressure them more.

“We can no longer be silent about Pakistan’s safe havens for terrorist organizations, the Taliban, and other groups that pose a threat to the region and beyond.  Pakistan has much to gain from partnering with our effort in Afghanistan. It has much to lose by continuing to harbor criminal terrorists.”

Trump hinted at withholding aid, which the U.S. has done before.

“We have been paying Pakistan billions and billions of dollars at the same time they are housing the terrorists that we are fighting. But that will have to change, and that will change immediately,” Trump vowed.

“It is time for Pakistan to demonstrate its commitment to civilization, order and to peace.”  [For its part, Pakistan was perplexed, and pissed.]

Trump also urged India to raise their contribution to the fight in Afghanistan “in line with our own,” highlighting the fact India is making $billions in trade with the Afghans while shouldering virtually zero of the burden. 

The president did not define what victory would look like, and on Tuesday, Secretary of State Rex Tillerson played down the idea the U.S. military would walk away from Afghanistan in triumph.

Addressing the Taliban directly, Tillerson said: “You will not win a battlefield victory. We may not win one, but neither will you.”

Boy, that Rex Tillerson is one tough hombre.

According to the Wall Street Journal, there are actually more than 12,000 U.S. troops in Afghanistan today, not the 8,400 publicly acknowledged. The Pentagon only discloses those deployed for longer periods while not counting those moving in and out on temporary status.  So the U.S. might only be technically adding 500 or so to meet the president’s goal.

While the administration’s new Afghan strategy strengthens the government in Kabul, many warn that Pakistan could deepen its ties with China, which, in turn, is in the midst of a border conflict with India, Pakistan’s chief enemy.

Pakistani officials have long said there is no military solution and that the only route is peace talks with the Taliban, not additional U.S. troops.

Afghan President Ashraf Ghani said, “The U.S.-Afghan partnership is stronger than ever in overcoming the threat of terrorism that threatens us all. The strength of our security forces should show the Taliban and others that they cannot win a military victory.  The objective of peace is paramount.”

Friday, a suicide bomber detonated himself at the gate of a Shiite mosque in Kabul, with other attackers storming the building, and at least 30 were killed as worshippers were gathering for Friday prayers.  ISIS claimed responsibility.

There was a time when Kabul was relatively safe, but not the past year.

Opinion....

Editorial / Wall Street Journal

“President Trump inherited a mess in Afghanistan, so give him credit for heeding his generals and committing to more troops and a new strategy. His decision has risks, like all uses of military force, but  it will prevent a rout of our allies in Kabul and allow more aggressive operations against jihadists who would be delighted to plan global attacks with impunity.

“Also give him credit for explaining a matter of war and peace to the American people Monday in a serious, thoughtful speech. Barack Obama unveiled his Afghan strategy in a major speech in 2009 and then tried to forget about the place. Mr. Trump should continue making the case for his strategy in more than Twitter burst.

“The heart of the new strategy is a commitment linked not to any timeline but to ‘conditions’ on the ground and the larger war on terror. ‘We are not nation-building again. We are killing terrorists,’ he said, in a line that will resonate with his political base even if building the Afghan defense forces is part of the goal.

“Mr. Obama’s great anti-terror mistake was imposing political limits that made it harder to succeed. He did this in Afghanistan at the start of his surge when he put a timeline on withdrawal. And he did it at the end of his term when he refused to let U.S. forces target Taliban soldiers even when they were killing our Afghan allies.

“Mr. Trump said he is lifting ‘restriction’ from Washington on the rules of military engagement. This means going after jihadists of all stripes, and it gives the generals flexibility to inflict enough pain on the Taliban that they begin to doubt they can win....

“Mr. Trump’s most significant shift – if he can follow through – is the challenge to Pakistan.  ‘We have been paying Pakistan billions and billions of dollars at the same time they are housing the very terrorists that we are fighting,’ he said.  ‘But that will have to change, and that will change immediately.’

“History shows that a key to defeating an insurgency is denying the kind of safe have that Pakistan provides the Taliban and the closely allied Haqqani network. Mr. Trump’s implication is that Pakistan must help in Afghanistan or face a cutoff in U.S. aid and perhaps cross-border strikes against terrorists inside Pakistan.  Pakistani military leaders have never taken such a U.S. threat seriously, and if they play the same double game Mr. Trump will have to show he means it.

“The Taliban now control as much as 40% of Afghan territory. But if the U.S. and Afghan army can stabilize more of the country, while training more Afghans to be as effective as its special forces have become, a diminished Taliban threat is achievable.  The Afghan government will also have to do its part by providing better governance.  Taliban leaders will have to be killed, but its foot soldiers might decide over time they can live with the government in Kabul....

“As Mr. Trump acknowledged, the U.S. public is wary of spending money on war without results. But Americans have also shown they will support commitments abroad for decades as long as casualties are low and they serve U.S. security interests. That’s true in South Korea, Europe and the Persian Gulf. The long war against jihadists will require similar commitments abroad.

“Mr. Trump campaigned against overseas entanglements, but America’s foreign commitments can’t be abandoned without damaging consequences.  Mr. Trump has now made his own political commitment to Afghanistan, and his job will be maintaining public support and congressional funding.  These obligations go with the title of Commander-in-Chief.”

Editorial / Washington Post

“Mr. Trump deserves credit for changing his position in a  way that is likely to displease some of his political supporters. The U.S. mission in Afghanistan will continue – not because a quick victory is on the horizon; it’s not, as Mr. Trump seems to understand. It will continue, because as Mr. Trump also came to understand, the alternative – a quick defeat – would be so much worse....

“The absence of a clear exit strategy can be a danger in its own right, and Mr. Trump stressed that ‘our commitment is not unlimited, and our support is not a blank check.’  But the reality is that preventing Afghanistan’s return to its state before 2001 is worth even a prolonged continuation of U.S. troop deployments and the inevitable fatalities that come with them. ...Though some describe Afghanistan as America’s longest war, it can also be compared with U.S. military deployments in Germany, Japan and South Korea, which have lasted far longer and which, as the Pacific naval accidents this summer underlined, also have their cost in lives.”

Editorial / New York Post

“All in all, this was a much-needed pragmatic realignment of U.S. policy – in this war and beyond. Some honorable peace with elements of the Taliban is possible down the line; India does need to step up if it wants to stop being written off. America may yet have to leave Afghanistan to its own devices, if Afghan leaders won’t do their share.

“On Monday, Donald Trump was an American president doing his job with all his heart, and his head.”

---

Yes, Monday, Donald Trump was presidential.  Tuesday, addressing his 35% base in Phoenix, Arizona, he gave an appalling performance. It was beyond nonsensical, and all about him.

Trump used up over 20 minutes of a 70-minute+ presentation with a diatribe against the “damned dishonest” press, accusing the media of exacerbating racial divisions, attacking ordinary Americans, giving a platform to hate groups and of “trying to take away our history and our heritage.”

“If you want to discover the source of the division in our country, look no further than the fake news and the crooked media,” said the president.

Trump had opened with three minutes on the crowd size, and how “there aren’t too many people outside protesting,” predicting that the media would not broadcast shots of his “rather incredible” crowd and reminiscing about how he was “center stage, almost from day one, in the debates.”

There was also no doubt that towards the end of the 72-minute rant, Trump was beginning to lose the crowd.

Reaction from the media was swift, save for Trump’s lackeys at Fox News, Trump having given a shout-out to Sean Hannity (“How good is Hannity?”), who in his first monologue after on Wednesday gave his usual lines about the “unprecedented slanderous attacks by the far-left, destroy Trump media,” and how Trump is “unfairly lied about,” while Hannity totally ignored Trump’s failure to mention his week ago press conference line of “good people on both sides” that stirred everyone up, or the initial assertion that there had been violence “on many sides, many sides.”.

[Trump tweeted Wednesday, “Last night in Phoenix I read the things from my statements on Charlottesville that the Fake News Media didn’t cover fairly.  People got it!”  The tweet before read: “Phoenix crowd last night was amazing – a packed house. I love the Great State of Arizona. Not a fan of Jeff Flake, weak on crime & border!”]

Just about everyone else in the media called Trump’s performance “unhinged” and “divisive.”

Tuesday, Trump also had reckless throwaway lines; like that his administration would “end up probably terminating Nafta.”

And this one: “Believe me, if we have to close down our government, we’re building that wall.”

We had been told there would also be “no discussion” of a pardon for controversial former sheriff, Joe Arpaio, but while Trump didn’t issue one, he made it clear a pardon was in the offing.  [And it came, Friday night.]

And of course he blasted Sens. McCain and Flake, without naming them, saying things like the following, in addressing the failure to pass the effort to hollow out ObamaCare: “One vote away!  I will not mention any names.  Very presidential, isn’t it?”

So Tuesday night sucked up all the oxygen on Wednesday.

Thursday, Trump tweeted: “I requested that Mitch M & Paul R tie the Debt Ceiling legislation into the popular V.A. Bill (which just passed) for easy approval.  They didn’t do it so now we have a big deal with Dems holding them up (as usual) on Debt Ceiling approval.

“Could have been so easy – now a mess!”

Congressional leaders pushed back, saying they didn’t want to politicize veterans and risk the failure of legislation that had strong bipartisan support.

Democrat leaders said there have been no talks over the August recess between the White House and Democrats – whose votes are needed on a debt ceiling vote.

Appearing on CNBC Thursday, Speaker Ryan said, “There’s a bunch of different options in front of us.  I’m not going to, kind of, negotiate through the media, but we have a lot of options in front of us and I’m really not worried about getting this done.”

Republicans always have a tough time on the debt ceiling because Tea Party-backed conservatives have opposed any such increase without cuts to federal spending, while Democrats reject the spending cuts, and, again, you need 60 votes.

House Minority Leader Nancy Pelosi put the ball in the GOP’s court Thursday.

“With the White House, House and Senate under one party control, the American people expect and deserve a plan from Republicans to avert a catastrophic default and ensure the full faith and credit of the United States.

“With so much at risk for hard-working families, Republicans need to stop the chaos and sort themselves out in a hurry.”

Earlier, in an event with Treasury Secretary Steven Mnuchin, Mitch McConnell said, “There is zero chance – no chance – we won’t raise the debt ceiling.”  Mnuchin wants a “clean” hike.

But Congress also has to pass its annual spending bills to fund the government going forward by Sept. 30 and after its return Sept. 5, it only has a few legislative sessions to do so, which means we are probably headed towards a continuing resolution, CR, to delay the hard negotiating another few weeks or months.  Spending bills also require 60 votes in the Senate, while both spending and debt ceiling bills can pass the House by a simple majority.

And you’ve got the border wall issue. Democrats won’t take the blame for any impasse. Republicans will.

As for the negotiations on reopening the North American Free Trade Agreement with Mexico and Canada, I’ve been saying for months the administration has a misguided fixation on trade deficits. So I note the following.

Editorial / Wall Street Journal

“Free trade is always good for consumers, but Nafta has also been a boon to North American producers. Companies have allocated capital to its highest use on the continent, investing where they find a comparative advantage. Two examples are U.S. agriculture and Mexican low-skilled manufacturing. The result has been an explosion in North American trade. Total trilateral merchandise trade has grown to more than $1 trillion annually from less than $300 billion in 1993.

“Enter (U.S. Trade Representative Robert) Lighthizer’s trade-deficit preoccupation, which holds that unless Mexico buys the same dollar amount of wheat and corn from the U.S. that the U.S. buys in widgets from Mexico, Americans are losing out.  This bizarre economics is dangerous to Americans prosperity.

“One of Nafta’s many benefits to American global competitiveness is that it allows U.S. manufacturers to access low-priced intermediate goods from the neighbors, add value in the U.S., and then export the final product around the world.  Consumers at home and abroad find these U.S. products attractive because they are well-made and competitively priced thanks to continental supply chains. Workers and wages have benefitted too.  The growth of high-paying U.S. jobs in technology, innovation, design and marketing depend on this free-trade web of supply chains.

“U.S. car and truck makers benefit in particular from intracontinental trade. Production facilities in all three Nafta countries ship unfinished products across borders, often multiple times, before completion. It is not an exaggeration to say that free-trade access to labor and capital across North America is largely responsible for the survival of the U.S. auto industry.  John Bozzella, CEO of the Association of Global Automakers, told Reuters last week that U.S. auto production has increased by more than one million vehicles annually since Nafta and there has been a boom in exports. Whether the industry can survive Mr. Lighthizer is another matter....

“Mr. Lighthizer previously toiled as a trade lawyer for the American steel industry. Squeezing foreign steel producers may be another of his Nafta goals.

“Mr. Lighthizer also wants to add a new mandate that Nafta vehicles contain ‘substantial U.S. content.’* The Lighthizer logic is that this will create jobs in the U.S. Yet if higher U.S. content were good for making and selling cars around the world, the government would not have to mandate it. As Mexico’s economy minister Ildefonso Guajardo said this weekend, ‘National content is not used in any [trade] agreement in the world, because it puts too much rigidities to the companies.’....

*Nafta currently requires that 62.5% of a duty-free vehicle be made in North America.  Lighthizer wants to increase this percentage and make it country specific.

“American manufacturers, aka the job creators, have issued their own warnings.

“ ‘We certainly think a U.S.-specific requirement would greatly complicate the ability of companies, particularly small- and medium-size enterprises, to take advantage of the benefits of Nafta,’ said Matt Blunt, president of the American Automotive Policy Council that represents GM, Ford and Fiat Chrysler.

“Mr. Lighthizer says he wants to restore jobs that have been lost since 1994 when Nafta was launched. But most of those jobs were lost to technology and higher labor productivity. New employment opportunities depend on new export markets and enhanced competitiveness. Step one is to let go of the obsession with Nafta trade deficits.”

Hear hear.

On a different trade issue, however, China, the Trump administration is right.

Robert Samuelson / Washington Post

“There is much to dislike in President Trump’s trade agenda, but he is correct on one subject: China’s relentless quest to extort American ‘intellectual property’ – technologies, business methods, patents.  Trump took a swipe last week at China’s policies by ordering his top trade officials to investigate.  Whether he can alter China’s behavior is unclear, but he is right to try, even at the risk of a trade war.

“China has high economic ambitions, write David Dollar and Ryan Hass of the Brookings Institution. Its industrial policy, called ‘Made in China 2025,’ envisions the country becoming the global leader in 10 crucial sectors: information technologies, machine tools and robotics, aerospace equipment, rail transport, maritime equipment, new energy vehicles, power equipment, agricultural equipment, new materials, and advanced medical products.

“ ‘These sectors will be supported by financing from state-owned [banks and] institutions and protected from open competition,’ Dollar and Hass say.

“To get to the top, China also needs advanced know-how. Here’s where foreign companies make a bargain with the devil. The Chinese require them to surrender technology in return for the right to invest and sell in China.  There are many mechanisms: joint ventures with Chinese firms, China-based research and development centers, licensing agreements made at bargain-basement rates.

“Again, Dollar and Hass:

“ ‘American companies agree to these technology transfers because it’s the only way they can access the second-largest market in the world. ...The list of companies operating in such ventures is essentially the roll call of top American technology firms.  Intel has agreements with two Chinese chipmakers in order to get access to the market for smartphones and tablets.  IBM and Advanced Micro Devices have both licensed chip technology to Chinese partners. Qualcomm has a similar partnership. Automakers have to share their technology with local partners in order to produce and sell there.’

“To this legalized technology extortion must be added an indeterminant amount of illegal cybertheft of business secrets.  Whatever the source, the consequences hurt Americans – and Europeans, Japanese and workers in other advanced countries. All of their high-technology industries face a slow eclipse by China’s favored firms. The aim is to substitute their production for other countries’, says Rob Atkinson of the Information Technology & Innovation Foundation. He says that the government plans to spend $1.6 billion to expand its semiconductor industry.

“The danger of global overinvestment, driven by China’s subsidies, is obvious....If global gluts of production capacity emerge – as they have in steel and aluminum – and China protects its producers, then losses will fall heaviest on non-Chinese firms.”

And then there’s national security, and China’s quest to gain access to items like the F-35 Lightning.

Hell, I’ve written myself in the past of how I know there have been Chinese agents in my building here in Summit.  A shadowy figure (never friendly in the least) will move in for six months and then just leave, and these aren’t people looking for a temporary home while they find a new place to live following a transfer. I know the difference by now.  There are all kinds of targets for Chinese industrial espionage in my area.  It’s infuriating.

Samuelson:

“The larger question involves how the new world order operates.  Ideally, the United States and China would cooperate on many issues where they have similar interests. These would include a viable world trading system and the nuclear future of North Korea. So far, there’s scant evidence of this enlightened collaboration.”

Trumpets....

--Sen. Tim Scott (R-S.C.) called on President Trump to sit down with civil rights leaders around the country after what he called his “challenging” remarks blaming “both sides” for the violence in Charlottesville.

Speaking on CBS’  “Face the Nation,” the Senate’s lone black Republican said that Trump should sit down with leaders like Rep. John Lewis (D-Ga.) who have a “personal connection” to America’s “painful” racist history.

“What the president should do before he says something, is to sit down, and become better acquainted, have a personal connection to the painful history of racism and bigotry of this country,” Scott said.  “It would be fantastic if he sat down with a group of folks who endured the pain of the ‘60s...the humiliation of the ‘50s and the ‘60s.”

--Former Homeland Security Secretary Jeh Johnson said on ABC’s “This Week” that he’d tell Trump advisers “you have to stay” in the administration if any of them asked.  They need to “right the ship.”

Opinion...Phoenix speech...Charlottesville....

Laurie Roberts, The Arizona Republic

“Well, that didn’t last long.

“On Monday, President Donald Trump called for the country to come together in the wake of Charlottesville.

“ ‘A wound inflicted upon a single member of our  community is a wound inflicted upon us all,’ he said.  ‘When one part of America hurts, we all hurt. And when one citizen suffers an injustice we all suffer together.’

“So naturally, on Tuesday, Trump signaled that he’ll be pardoning Maricopa County Sheriff Joe Arpaio – a guy who for years targeted people because of the color of their skin and then for 18 months ignored a federal judge’s order to cut it out.

“ ‘I’ll make a prediction,’ Trump told a Phoenix Convention Center crowd jam packed with cheering supporters.  ‘I think he’s going to be just fine, OK?  But I won’t do it tonight because I don’t want to cause any controversy. Is that OK? But Sheriff Joe can feel good.’

“As for the rest of us, we can only feel...amazed, astonished and downright astounded by our president’s performance in Phoenix.

“One in which he led the nation to believe that no more than a few dozen misfits were protesting his appearance rather than the thousand or more Americans who took to the streets.

“One in which he talked about his growing support in Arizona, never mind a recent poll that shows his support has slipped to 42%.

“One in which he spent nearly a half four trying to rewrite history about Charlottesville, as if he never said that ‘both sides’ were to blame – the people who stood for white supremacy and the people who stood against it.

“One in which he spent 90 minutes massaging America’s biggest ego...his own.

“He said nothing new. Announced no new initiatives.

“Instead it was a red meat ranting, fragile ego stroking stream of consciousness preached to an adoring crowd of supporters.

“It was dishonest media...blah blah blah...drain the swamp...blah blah blah...build the wall...blah blah blah...Barack Obama...blah blah blah...make America great again.

“And the crowd LOVED it.

“All in all, a great campaign speech by our unifier-in-chief and just in time.

“Trump is up for re-election, after all, in just 1,168 days.”

Michael Reagan / Star-Ledger

“As we’ve said before, Donald Trump has to learn to just shut up and let things go.

“The failure to do that is the worst Achilles heel of a president who seems to have half a dozen Achilles heels.

“Because he can’t think on his feet, because he doesn’t know how to say the right thing at the right time, because he thinks he’s got to win every petty argument with the anti-Trump media, the president has mired himself unnecessarily in yet another controversy of his own making.

“This time it’s Charlottesville....

“You had the dregs of this country’s minuscule right-wing hate sector....

“You had their violence-prone left-wing opponents – organized groups like Black Lives Matter and Antifa – pouring in from out-of-state to protest the presence of the white nationalists.

“The right-wing hate groups marched around the town Nazi-style, chanting anti-Semitic and anti-black slurs, exercising their First Amendment rights and putting their moral and political ugliness on full display.

“Who didn’t know the anti-Trump media was going to be there en mass to record everything?

“Who didn’t know the liberal media would seek out a visiting professional racist like David Duke and get him to say something nice about President Trump on camera?

“Well, apparently President Trump and his staff didn’t know.

“They certainly weren’t prepared to respond to the predictable violence....

“Charlottesville should have been a no-brainer for the White House – and it should be finished business.

“The president should have read a simple prepared statement last Sunday that was written by someone who knew what to say and how to say it.

“He should have said, quickly and clearly, that the white nationalists, the KKK, the neo-Nazis and their fellow haters were despicable Americans with un-American beliefs – true deplorables, if you will.

“He should have reemphasized that they and their ilk did not speak for him or his administration.  Ditto for the David Dukes of the world.

“Then the president should have issued the standard presidential condolences and moved on to tax reform or North Korea or whatever important issue he has on his unfinished plate.

“Charlottesville was never Trump’s fight. He  should have stayed out of it – above it – and acted presidential, which, I know, is asking a lot.

“Instead he again took the media’s bait; and then did his usual clumsy job of engaging a pack of rabid reporters in full view of the world.

“He tried to equate extremist white nationalists with left-wing protest groups like Black Lives Matters.

“Like a reckless rookie unable to learn from his mistakes, QB Trump is repeatedly scrambling out of the pocket, throwing incompletions in every direction – and then blaming his blockers, receivers and cheerleaders on Twitter for his team’s negative yardage....

“He has yet to learn that when you’re the president you have to know when to shoot back, when to change the subject and when to just shut up in the first place.”

Wall Street

One thing you won’t see in a Trump tweet or in  a campaign boast is the fact that the U.S. economy is not only growing because of the notion it’s all about the president’s policies, but rather the fact that for the first time in a decade, the world’s major economies are growing in sync.

All 45 countries tracked by the Organization for Economic Cooperation and Development are on track to grow this year, with 33 poised to accelerate from a year ago.

The International Monetary Fund said in July that global GDP would grow 3.5% in 2017, and 3.6% in 2018, vs. 3.2% growth last year.

So with this as a backdrop, leaders of the world’s central banks and economists gathered at their annual forum in Jackson Hole, Wyoming, and Fed Chairwoman Janet Yellen ended up saying zippo about monetary policy.

Instead, Yellen’s speech was a sharp rebuke to assertions by President Trump and top aides that rules safeguarding the economy against another financial crisis need to be rolled back.

“The evidence shows that reforms since the crisis (read ‘Dodd-Frank’) have made the financial system substantially safer,” Yellen said.  Trump has said that post-crisis regulations went too far, calling Dodd-Frank a “disaster” that has made it hard for consumers and businesses to access credit and restricted growth. One of his arguments is that banks are required to hold too much capital, thus making it harder to lend.

Yellen did acknowledge that some borrowers may find it more difficult to attain credit.

But if Yellen wanted another four-year term as Fed Chair, and Trump has said nice things about her recently, she may have cooked her goose with the stance against rolling back banking rules.

Ditto, Gary Cohn, who is said to be interested in replacing Yellen, only Trump may be rather ticked at him today because of an interview Cohn granted the Financial Times, wherein he blasted the president’s handling of Charlottesville.

“I believe this administration can and must do better in consistently and unequivocally condemning (white supremacists and neo-Nazis) and do everything we can to heal the deep divisions that exist in our communities. Citizens standing up for equality and freedom can never be equated with white supremacists, neo-Nazis, and the KKK.”

Cohn added that he felt “compelled to voice my distress over the events of the last two weeks, and that he had drafted a letter of resignation, while coming under intense pressure to quit over Trump’s reaction to the incident, but decided against it, adding:

“As a Jewish American, I will not allow neo-Nazis ranting ‘Jews will not replace us’ to cause this Jew to leave his job.”

[Cohn also spoke of tax reform in the FT interview and he hopes legislation effecting same is passed by year end; a belief shared by Treasury Sec. Mnuchin.]

Back to the U.S. economy, July new home sales came in far less than expected, 571,000 annualized pace, but the two prior months were revised upwards. 

Existing-home sales for the month also fell short to the lowest pace of 2017, 5.51 million.

The median existing-home price in July was $258,300, up 6.2 percent from July 2016, the 65th straight month of year-over-year gains.

Friday, the durable goods (big-ticket items) figure for July was -6.8%, but this is deceiving.  The better barometers, ex-transportation and business spending (capex) were up 0.5% and 0.4%, respectively, which is solid.

Europe and Asia

Just a few tidbits on the eurozone.

Markit released its flash readings for August and the eurozone manufacturing PMI came in at 57.4 vs. 56.6 in July...50 being the dividing line between growth and contraction, with services at 54.9 vs. 55.4 last month.

Recall, the flash estimates then break down just France and Germany, specifically.

Germany’s manufacturing figure is 59.4 vs. 58.1 in July, while non-manufacturing came in at 53.4 vs. 53.1.

In France, manufacturing was at 55.8 vs. 54.9, services at 55.5 vs. 56.0 last month.

All in all, more solid readings.

Andrew Harker / IHS Markit:

“The latest PMI readings for the eurozone signal a continuation of the recent strong performance of the currency bloc’s economy.  This stabilization in the rate of expansion is pleasing, following signs of growth easing in recent months.”

Yes, the current quarter should show growth of 0.5% to 0.6% over the second quarter’s 0.6% rise. This is good.

Separately, European Central Bank President Mario Draghi is confronted by an economy where robust growth is accompanied by anemic inflation.

“(John Maynard) Keynes is often quoted as saying, ‘When the facts change, I change my mind,’” Draghi said recently.  “Well, for policymakers, it is not that simple... We must be aware of the gaps that still remain in our knowledge.”

So Friday, he was in Jackson Hole, with Chair Yellen, and Draghi said that global trade and cooperation were under threat, a risk to growth in advanced economies.  He added that the current environment of easy monetary policy makes a major relaxation of financial regulation dangerous.

“Given the large collective costs that we have observed, there is never a good time for lax regulation.”

But, like Yellen, Draghi didn’t address current monetary policy, except in a Q&A after, when he said that while he was confident the ECB’s 2% inflation target would be met, he urged patience when it came to the bank’s ultra-easy monetary policy. 

Eurobits....

--On the Brexit front, the U.K. published a flood of documents this week, but stayed mum on the big issue for the people at the moment: just how much money will it be forced to cough up to the European Union for exiting.

Formal talks resume next week and Britain has less than eight weeks to convince the EU it has done enough to begin trade discussions.  But nothing moves forward without the U.K. and EU agreeing on a final bill for all of the former’s future obligations (think pensions for EU staff, among other financial matters).

The U.K. doesn’t want to get drawn into the money issue just yet, while the EU, accepting that the two sides don’t have to agree on a figure today, still must come up with a method of calculating the final figure.

The EU wants to base its bill on past commitments, but Britain is saying it should be partly determined by the scope of its future access to EU markets.  So it’s a chicken and egg deal.  It’s also a huge political issue for Prime Minister Theresa May.

As for the documents that were released this week, the EU seems unimpressed because while Mrs. May is focused on future relations, the EU first wants to address the Irish border, protection for Europeans living in the U.K. and the divorce bill.  Plus, you’re talking about the desires of 27 different nations.

But the U.K. did appear to climbdown on the issue of the European Court of Justice. The prime minister had declared the U.K. would “take back control of our laws and bring an end to the jurisdiction” of the ECJ, but now her government is seeking to bypass just the body’s “direct jurisdiction.”

So this means EU judges would have some say in the U.K. post-Brexit. The test will be if EU officials accept the shift was enough to speed up negotiations.

There is simply no way the EU is signing a deal without the bloc’s judges having some long-term influence in the U.K., particularly when it comes to the rights of its citizens living in Britain.

Much more next time with the talks resuming in Brussels.

Separately, the U.K. food industry warned that a Brexit workforce shortage could leave a third of its businesses unviable.

31% of the businesses in the sector have already seen EU workers leave the U.K., according to the Food and Drink Federation.  This organization is calling on the government to guarantee the rights of nationals from across the European Economic Area.

Along the lines of the above, the government announced that net migration to the U.K. has fallen to the lowest level in three years after a surge in the number of EU nationals leaving since last June’s Brexit vote.

For March 2017, the figure was 246,000 (difference between those entering and leaving), though the U.K. is committed to reducing net migration to below 100,000.

There was some good news.  Britain’s Society of Motor Manufacturers and Traders reported the number of cars built in the U.K. last month rose by 7.8% over last year, though the number made in the first seven months fell 1.6%.  Almost four out of five cars rolling off British production lines are exported.  [And of course other nations are exporting to the U.K.]

But the number of new cars registered in the U.K. (sales) fell almost 10% in July  - the fourth month of declines.

--French President Emmanuel Macron really stirred up a hornet’s nest in a trip to various Central and Eastern European countries this week.  Macron said on Friday that Poland was isolating itself in Europe and that its citizens “deserve better” than their government’s refusal to seek compromise on European rules on the employment of labor from low-pay nations.

“Europe is a region created on the basis of values, a relationship with democracy and public freedoms which Poland is today in conflict with,” Macron said, at the Black Sea resort city of Varna.  “Poland is not defining Europe’s future today, nor will it define the Europe of tomorrow.” [Reuters]

Macron was alongside Bulgaria’s President Rumen Radev, and Macron wants both Poland and Bulgaria to help the EU negotiate through one of Macron’s hot-button topics, the issue of posted worker rules.

What is this?  It’s the battle between the rich west and poor east.

Companies have long profited from rules that allow them to “post” workers from one country to another, but a backlash has been growing across northern Europe amid evidence employers are taking advantage of the rules to hire low-wage foreign workers, say from Eastern Europe, at the expense of local citizens, a big recent campaign issue in France.

Macron had promised to protect his fellow Frenchmen from “unfair competition” from the east, and thus the purpose of his trip to Central and Eastern Europe.

“Do you think I can explain to the French that businesses are closing in France to move to Poland while construction firms in France are recruiting Polish workers because they are cheaper?” Macron said in a recent interview with European newspapers.

But this charge has infuriated the governments of the likes of Poland, Hungary and the Czech Republic.  They accuse Macron of protectionism, and wonder why France and its ilk aren’t instead cracking down on employers abusing the system.

So Macron has suggested new rules to limit to one year the length of time an employee could be posted to another European Union country.

--Chancellor Angela Merkel is well on her way to victory Sept. 24 in Germany’s national elections, and so in an attempt to draw a distinction between his candidacy and hers, opponent Martin Schulz of the Social Democrats demanded the U.S. withdraw its nuclear weapons from the country, as he takes an increasingly anti-American tack.

As for Merkel, she defended Donald Trump, saying she’s obliged to treat him with respect because he won the U.S. presidential election fair and square, though she added she will vigorously pursue German interests when policies clash.

--Police shot dead the man suspected of driving the van that rammed into pedestrians in Barcelona last week, ending a five-day manhunt.  When I wrote of the terror attack last week, it was thought Younes Abouyaaqoub was one of those killed in a shootout in Cambrils, outside Barcelona.  Then we learned he was still on the loose.

Catalan police said the full terror cell consisted of 12 people, with six now killed by police.  Four were captured, and two others are believed to have died in the explosion at their bomb factory, where we’ve learned they were preparing to carry out a much larger attack

Turning to Asia....

Just a few economic notes from Japan, with its flash reading on manufacturing in August at 52.8 vs. 52.1 in July, while the country’s core consumer price index, which strips out fresh food, for July rose to 0.5% annualized from June’s 0.4%, according to the government.  Believe it or not, this marks the highest level since March 2015, while the Bank of Japan continues to sit with its 2% target.  Ergo, there will be no change in monetary policy for a long time at the Bank of Japan.  It cut its inflation forecast for the year to March 2018 to 1.4% back in July. Even this sounds ambitious.

[Headline CPI was 0.4%, the same as in the prior three months.  The yield on the Japanese 10-yr. bond ticked down Friday to 0.00%.]

Street Bytes

--Stocks rose after a two-week losing streak, with the Dow Jones up 0.6% to 21813, the S&P 500 up 0.7%, and Nasdaq 0.8%.  But it was a painfully slow week in terms of market action and next week, baring a geopolitical or D.C. surprise, promises more of the same, it being a heavy end of summer vacation week for the Street’s traders. 

--U.S. Treasury Yields

6-mo. 1.11%  2-yr. 1.33%  10-yr. 2.17%  30-yr. 2.75%

--As Hurricane Harvey hits tonight, it has the high potential to negatively affect five southern Texas coast refineries. As for the impact on gasoline prices, spikes at the pump could occur, but they wouldn’t last long.  At least that is my guess now.

The biggest impact will be on crude imports into Houston, Texas City and Baytown.

--Chevron Corp. CEO John Watson is planning on stepping down next month, according to people familiar with the matter, with Watson’s successor not yet finalized by the board. Watson would stay for a smooth transition.

These days at Big Oil, it’s all about squeezing costs, and shorter-term investments that turn a quick profit, rather than the giant, multi-decade projects of days gone by.

--Danish container shipping giant A.P. Moller-Maersk said it had agreed to sell its oil and gas business to the French energy giant Total for $4.95 billion, with Total’s CEO saying the company would take advantage of the low-cost environment to start new projects and seek acquisitions, while Maersk said it would focus on its shipping business.

Total’s overall production will increase by 160,000 barrels a day in 2018 through the deal, and it will become one of the largest operators of offshore rigs in northwest Europe.

--In a significant move, Walmart announced it would be partnering with Google and its Google Assistant to allow customers to place orders through the smart device and have them delivered by Google Express, an attempt to leverage Walmart’s brick-and-mortar empire in its battle with Amazon for the future of commerce.

Walmart is looking for ways to utilize its nearly 5,000 retail outlets double as distribution points for online sales.

Walmart.com’s new chief, Marc Lore, wrote in a blog post on Wednesday, that the partnership will allow Walmart to make use of its “4,700 U.S. stores and our fulfillment network to create customer experiences that don’t currently exist within voice shopping anywhere.”

Many remain skeptical of Walmart’s dreams in this respect, but I’d be optimistic Walmart can make real inroads against Amazon....

--....Speaking of which, Amazon announced it plans to shake up Whole Foods Market, by lowering prices on bananas, butter, organic avocados, rotisserie chickens and other items.  The acquisition of Whole Foods will close on Monday, and Amazon said it would waste no time making changes at more than 460 Whole Foods stores in the U.S., Canada and Britain.

Amazon seems determined to change the chain’s reputation as “Whole Paycheck,” as it lowers prices on a “selection of best-selling staples across its stores, with much more to come.”

Needless to say, shares in grocery and wholesale chains fell on the news.  Lower prices at Whole Foods means they will have to lower their own to compete, and that means lower margins.  This is big. Good for you and me, though.

--Uber Technologies Inc. reported a $645 million loss for the second quarter, narrowing from $708 million in the first quarter.  Revenue, not including a one-time outlay for New York drivers the company had mistakenly underpaid, rose 17% to $1.75 billion compared with the prior quarter and more than double the year ago period.

Uber’s booked $8.7 billion in the second quarter, also double  Q2 2016.

The company has $6.6 billion in cash, down from about $7.2bn as of the end of March.  Softbank Group Corp. may add to the cash if its proposed investment of at least $1bn goes through (perhaps buying part of Benchmark Capital’s stake).

But the results come as the CEO search to replace Travis Kalanick continues, while early Uber investor Benchmark is suing him for the return of three board seats it says he agreed to relinquish.

Separately, four mutual funds have written down the value of their Uber holdings by as much as 15% as of June 30 as some investors question the sky-high valuation.  The company is currently valued at about $68 billion.

As for the CEO search, which the company wants to wrap up soon, General Electric Chairman Jeff Immelt is seen to be the current front-runner, at least last I saw, not that I really give a damn.

--McDonald’s announced it would be serving up more antibiotic-free meat at its restaurants around the world, a big move since McDonald’s is the biggest purchaser of beef in the country and one of the largest buyers of pork.

Phasing out of the use of antibiotics is critical, medical experts say, because of the growing resistance to the drugs and fear of large-scale public health issues.

On large industrial farms, antibiotics are often used in animal feed.

Matthew Wellington, antibiotics program director for U.S. Public Interest Research Group: “The misuse of antibiotics and the rise of resistant bacteria is a worldwide health problem, not just a problem.  We’re glad that McDonald’s is working to preserve the effectiveness of these lifesaving medicines globally, and hope the chain moves quickly to make that vision a reality.”

According to the Centers for Disease Control and Prevention, at least 2 million Americans become sick and 23,000 die every year from antibiotic-resistant infections.  [Samantha Bomkamp / Chicago Tribune]

Separately, McDonald’s is severing ties with its second-largest franchisee in India, which could result in the loss of 170 outlets, forcing the chain to start over.  Connaught Plaza Restaurants Pvt. Ltd., which had a 22-year-old relationship with McDonald’s and operated in the north and east of the country, apparently wasn’t paying royalties and had violated other “essential obligations” of its contract with the latter.

The franchisee for the west and south of India is not impacted.

--Lowe’s reported earnings that missed estimates and warned of slower growth in profit margins as it spends more on marketing and staffing to take advantage of a robust home improvement market.  Lowe’s shares fell sharply on the news even as the No. 2 U.S. retailer in its sector (behind Home Depot) said demand for lumber, appliances and other products has soared  as homeowners increasingly prefer to remodel rather than buy a new home.

Lowe’s said it would increase staffing during weekends and other high-volume periods to improve the customer experience, CNBC’s Jim Cramer slamming the company the other day for its long lines.

Lowe’s net income rose 21.4 percent to $1.42 billion, with net sales climbing 6.8 percent to $19.50 billion, both of which lagged the Street’s forecasts.

Same-store sales did rise a solid 4.5 percent, which still trailed Home Depot.

--A South Korean court on Friday convicted Lee Jae-yong, the heir to the Samsung business empire, of bribery and embezzlement and sentenced him to five years in prison, a big decision in that in past cases involving major business figures, the penalties have been light.  Lee also may yet get pardoned, but it’s a strong message to the nation’s big, family controlled businesses (chaebols) and their dominance in one of the world’s most successful economies.

The court ruled that Mr. Lee and four other Samsung executives paid $6.4 million in bribes to the country’s disgraced former president, Park Geun-hye, to ensure Lee’s grip on Samsung Electronics was strengthened.

--According to the 2017 Forbes 100 Richest in Tech list, Bill Gates remains the richest in the world at $84.5bn, slightly ahead of Jeff Bezos, $81.7bn.  Mark Zuckerberg is third with $69.6bn.

The total worth of the world’s 100 richest tech billionaires has surpassed $1tn for the first time, according to Forbes, a rise of 21% in just 12 months.

Of the top 100, 50 are U.S. citizens and 33 are from Asia, half of the latter living in China or Hong Kong.

--And the converse of billionaires are us Dollar Tree shoppers.  The other day, I had to bring a food dish to a picnic and I knew I didn’t have an appropriate bowl to put it in, and also knew I’d be leaving early and wasn’t sticking around to bring back my bowl, but I could get a cheap bowl at Dollar Tree for...a buck and just leave it! 

Anyway, Dollar Tree reported terrific earnings on Thursday of $233.8 million, above the Street’s expectations, on revenues of $5.28 billion, with same-store sales of 3.9%...its Family Dollar subsidiary’s comp sales rose 1.0%.

--Research firm eMarketer’s latest forecast has Snapchat overtaking both Instagram and Facebook in terms of total users aged between 12 and 24 for the first time this year.  Both Snapchat and Instagram continue to attract younger users, drawing some of them away from Facebook; young teens having the attention span of a gnat...not to give gnats a bad name.

--Business at Tiffany’s flagship Fifth Avenue store – located next to Trump Tower – has returned to normal after months of disruptions from police barricades.

Overall company comparable sales were off 2 percent from last year in its recent quarter and off 1 percent in the Americas, much better than the prior quarter.

--Sears Holdings Corp. said Thursday it would close an additional 28 Kmart stores nationwide.  Already this year, Sears has closed 180 stores, including from its Kmart chain, and an additional 150 are to close down by the end of next quarter.

Sears reported its second-quarter loss was $251 million, as revenue fell 23% to $4.37 billion, owing to all the store closures. Same-store sales cratered 11.5%; down 9.4% at Kmart, and off 13.2% at Sears locations open at least a year.

--In a good sign for the economy, American ports took in a near-record number of shipments in July, according to preliminary data from the National Retail Federation, as retailers and manufacturers begin to stock up for the peak shopping season.  Shipments of auto parts, furniture and back-to-school related goods were among the strongest categories of growth, as reported by Panjiva, a trade data service. 

Imports surged 15% in July at the ports of Los Angeles and Long Beach, Calif., for one, while the Port of Savannah, Ga., the second largest East Coast port, reported its busiest July ever.  [Erica F. Phillips / Wall Street Journal]

--A Los Angeles jury issued a $417-million verdict Monday against Johnson & Johnson, finding the company liable for failing to warn a 63-year-old woman diagnosed with terminal ovarian cancer about the risks of using its talcum products.

More than 300 similar lawsuits are pending in California and more than 4,500 claims in the rest of the country, alleging J&J ignored studies linking its Baby Powder and Shower to Shower products to cancer.

Johnson & Johnson said it would seek to overturn the verdict; the company citing various scientific studies, as well as federal agencies, including the FDA, that have not found talc products are carcinogenic.

--As many as 9 people were killed, with many missing, as Typhoon Hato barreled into Macau, wiping out power and water in large pockets of the world’s biggest gambling hub.  Hato was the strongest storm to hit the area since 1968, inflicting significant damage on Hong Kong as well, which shut down its financial markets, a rare move.

Having been to Macau a couple times, I can only imagine the damage as 124 mph winds and torrential rain did a number on the infrastructure, including the water pumps.  You just have to picture the tens of thousands of tourists that are there every day.   I would take a high-speed ferry from Hong Kong, which runs non-stop (very comfortable 50-minute ride), and as the storm wasn’t forecast to hit with the strength it did, I can only imagine how many tourists were then stranded in hotels now without power and water.  The video from there is frightening.

A Wynn Hotel Macau staff member told the South China Morning Post that they are encouraging their guests to stay and “stay safe.”  Guests aren’t being rushed out, and new arrivals are not being accepted.

--The U.S. State Department has warned citizens about traveling to Cancun and Los Cabos, after a surge in violence in those regions; predominantly turf battles between drug gangs that have resulted in shootings where innocent bystanders have been killed.

For years, both areas were largely insulated from the drug war violence, but this year they have witnessed a major uptick in killings.

In Los Cabos, which includes the cities of Cabo San Lucas and San Jose del Cabo, three people were shot to death this month at the entrance to a popular beach.  [Kate Linthicum / Los Angeles Times]

Tourism is a $20 billion a year industry in Mexico and these travel warnings could be a huge blow.

--Speaking of tourism, according to the International Monetary Fund, tourism to Iceland this year will amount to 2.2 million visitors, almost five times as many as in 2010, which is incredible.  I’ve been here twice, the last time in 2009.

Tourism is now Iceland’s biggest industry, surpassing its traditional lifeline, fishing.

But these numbers have left the government unprepared in terms of infrastructure.  Because the hotels are packed, and it takes time to build new ones, the government has pushed Airbnb, which has helped lead to a surge in home prices, up 18.3% in the year through March, according to Knight Frank.

Actually, it sounds like a nightmare, with downtown Reykjavik packed.  I’m glad I went when I did, which was after the 2008 financial collapse there.  It has more than recovered. The economy grew 7.2% last year.

--A favorite tweet, courtesy of the New York Times: “I feel like a lot of people don’t understand this, but money, fame, love – none of it matters if you don’t have a good social media strategy.”  [Existential Comics]

--I saw the following headline on the wires: “Arby’s Announces Senior Leadership Changes.”

I want to be Senior Vice President, Bacon Sides.

Speaking of which, Johnny Mac just informed me that Asheville, N.C., has its “BaconFest” at Highland Brewing, Sat., 1 p.m. until 4 p.m.  So if you’re in the area, catch it.  I’m jealous.

Foreign Affairs

North Korea: With photographs showing a new rocket design, North Korea is sending a message it continues to work on improving its intercontinental ballistic missile technology; specifically, a more powerful one than previously tested, according to weapons experts. If perfected, Pyongyang could hit any target on the U.S. mainland, including Washington and New York.

The photographs released by state media on Wednesday showed Kim Jong Un standing next to a three-stage rocket it called the Hwasong-13.  The photos were accompanied by a report of Kim issuing instructions for the production of more rocket engines and warheads.

Some believe it was a mistake for the photos to be aired. Certainly it was an intelligence ‘find’ for the U.S. and South Korea.

But reports from the KCNA news agency this week largely lacked the traditional robust threats against the U.S., save for Sunday’s threat to unleash a missile attack. 

That said, Pyongyang has been pretty quiet, especially considering the U.S.-South Korean war games have been taking place.

On Tuesday, President Trump said in Phoenix, “I respect the fact that I believe [Kim Jong Un] is starting to respect us.  Maybe, probably not, something positive will come out of it.”

Sec. of State Tillerson told reporters: “I am pleased to see that the regime in Pyongyang has certainly demonstrated some level of restraint that we have not seen in the past. Perhaps we are seeing our pathway to sometime in the near future having some dialogue.”

Probably not.  Kim is just going about his thing, ramping up his missile program.

Separately, Israel’s Haaretz newspaper reported on a confidential United Nations review on North Korea sanctions violations. “Two North Korean shipments to a Syrian government agency responsible for the country’s chemical weapons program were intercepted in the past six months.” 

The U.N. is also investigating cooperation between North Korea and Syria on the latter’s Scud missile programs and maintenance and repair of Syrian surface-to-air missile defense systems.

For its part, the U.S. imposed sanctions on sixteen companies and individuals accused of helping Pyongyang develop missiles and nuclear weapons (10 companies, six individuals) primarily from China and Russia, as announced by Treasury Secretary Mnuchin.

Friday night, Kim fired three short-range missiles into the sea from its eastern coast, though it appears all three were failures. Nonetheless, these were the first missiles since the successful July 28 ICBM test.

Iraq/Syria/Iran:

The United Nations called for a humanitarian pause in the fighting in the Syrian city of Raqqa, urging the U.S.-led coalition to rein in air strikes that have caused significant casualties.

But Friday, the Syrian Observatory for Human Rights said at least 34 Syrian soldiers and allied fighters were killed in an ISIS counterattack east of Raqqa. The Observatory said IS “made major progress and...expanded the area under its control along the southern bank of the Euphrates,” which isn’t the way this is supposed to happen.

Monday, Russia’s air force claimed it killed over 200 ISIS fighters on their way to the Syrian city of Deir al-Zor, according to Russian news agencies, as ISIS concentrates its forces around the city after being forced out of the south of Raqqa.

The Syrian army operation in the area, backed by Russia, is different from the fight for Raqqa itself.  There, the Syrian Democratic Forces, SDF, a U.S.-backed alliance of Kurdish and Arab fighters, has captured less than 60% of Raqqa city since it entered in June after months fighting to encircle it beforehand.  [Agence France Presse]

Israel: President Trump remains committed and optimistic about achieving peace between Israel and the Palestinians, as passed on by senior adviser Jared Kushner in the region this week.  But there is zero real progress thus far, Kushner meeting separately with Israeli Prime Minister Netanyahu and Palestinian President Abbas.  Palestinians are still seeking a pledge of support from the administration for the creation of a Palestinian state alongside Israel – which has been the foundation of U.S. Middle East policy for over two decades.

For his part, Netanyahu faces pressure from his right-wing coalition partners not to give ground on Jewish settlement building in occupied territory that Palestinians seek for an independent state.

Lebanon: Hizbullah leader Sayyed Hassan Nasrallah said on Thursday that his forces had captured much of an ISIS enclave on Syria’s side of the Lebanese border, in a joint offensive with the Syrian army.  Talks on a truce deal have begun with Islamic State, but Nasrallah said he’s looking for a military victory.

Egypt: President Trump called Egyptian President Sisi on Friday, telling him the U.S. wants to strengthen ties with Cairo, even as Washington cut some aid to Egypt this week over human rights concerns.  Wednesday, Jared Kushner met with Sisi, as Egypt issued a statement saying the cut in aid reflected “poor judgment on the strategic relationship that ties the two countries over long decades.”

But Egyptian rights activists have said they face the worst crackdown in their history under Sisi, accusing him of taking back the freedoms won in the 2011 Arab Spring uprising that ended Hosni Mubarak’s 30-year rule. The Egyptian government says the rights groups are taking foreign funds to sow chaos.

China: After President Trump’s remarks on Pakistan’s lack of cooperation regarding Afghanistan, China defended its ally, with Foreign Ministry spokeswoman Hua Chunying saying Pakistan was on the front line in the struggle against terrorism and had made “great sacrifices” and “important contributions” in the fight.

Meanwhile, China’s crackdown on the press continues, though some are fighting back.

Editorial / Washington Post

“The Cambridge University Press has rightly abandoned its plan to censor the prestigious China Quarterly journal at the behest of the Chinese authorities. It was indefensible for the journal to remove some 300 sensitive articles and book reviews from its website for a Chinese audience, and it realized the error quickly. But the Chinese request will probably not be the last.

“The state-run Global Times newspaper asserted that ‘Western institutions have the freedom to choose’ whether they want to do business in China.  ‘If they don’t like the Chinese way, they can stop engaging with us. If they think China’s Internet market is so important that they can’t miss out, they need to respect Chinese law and adapt to the Chinese way.’  This will sound familiar to U.S. companies that have been instructed that they must obey Chinese cybersecurity laws that could be used for repression, under threat of criminal penalty, and have complied.  Cambridge also acted with an eye on the market; the press has enjoyed double-digit year-on-year growth in China for the past five years, and its most popular title, an English-language course book, sold more than 3 million copies over the past years, according to the Financial Times.

“For years, an argument has been made that engagement with China would change it, that contact with the West would influence China toward openness, rule of law and democracy. We have often agreed with this notion, and we still think engagement beats isolation. But the presidency of Xi Jinping is making it harder to defend this proposition. China is actively resisting Western influences and pushing back on digital battlefields. The ‘China way’ means that a paternalistic state, run by a party with a monopoly on power, will decide what people can know and what they can say.”

In line with the above, in Hong Kong on Sunday, tens of thousands took to the streets to protest against the jailing of three young democracy activists.  The three, ages 20 to 27, were jailed for six to eight months for unlawful assembly, dealing a blow to the youth-led push for universal suffrage and prompting accusations of political interference from Beijing.

With the jailing of the three, that meant in the legislative council the opposition would now lack the votes to filibuster legislation.

Editorial / Wall Street Journal

“Hong Kong now has its first political prisoners, and if Beijing has its way they will be followed by many more. That will force the city’s residents into a stark choice of whether to continue fighting for the rights China promised when it guaranteed 50 years of Hong Kong autonomy or accept that the former British colony’s special status is fading into history.”

Russia: Foreign Minister Sergei Lavrov, responding to the U.S. Embassy’s announcement on Monday that it would implement a visa stop for Russian citizens, said: “We’re not going to take out our anger on American citizens.  So if someone hoped that this stupid example would be contagious, they miscalculated.”

The U.S. Embassy said it would temporarily stop processing non-immigrant visa applications starting Aug. 23, though operations in Moscow would resume in September, while other consulates would “remain suspended indefinitely.”

This is in response to the forced reduction in Embassy staff by the Kremlin.

Lavrov said the U.S. was fomenting unrest in Russia.

Ukraine: Defense Secretary Jim Mattis, on a trip to Ukraine this week, said Washington would pressure Russia over its aggressive behavior and signaled his personal support for supplying Kiev with weapons.  Mattis said Russia had not abided by the Minsk ceasefire agreement meant to end the separatist conflict in eastern Ukraine.

U.S. Secretary of State Rex Tillerson was in Kiev in July, so we are doing a good job of showing our support.

But we still haven’t given Ukraine the defensive weapons it has requested since the start of the war and this ticks me off to no end.  Mattis can only do so much as it’s up to Trump.  Mattis knows the U.S. should be helping Ukraine in a much bigger way than night-vision goggles.  Both Presidents Obama and Trump are/have been total idiots in this regard.

Mattis said, correctly, “Defensive weapons are not provocative unless you are an aggressor and clearly Ukraine is not an aggressor since it is their own territory where the fighting is happening.”

Canada: The country fears a huge surge in asylum seekers crossing the border from the United States, which is putting pressure on Prime Minister Justin Trudeau. The number of migrants illegally entering Canada more than tripled in July and August, hitting nearly 7,000.  Haitians, who face deportation in the U.S. when their temporary status expires in January 2018, account for much of the inflow.  Citizens from El Salvador, Nicaragua and Honduras are also slated to lose legal protection in early 2018, so they’ll no doubt be heading north in increasing numbers.

With most of the migrants flooding into predominantly French-speaking Quebec, there are a rising number of protests from opposition politicians and anti-immigrant groups.

For his part, Trudeau tweeted Canada’s welcome of refugees after President Trump unveiled a travel ban in January, and now he is regretting this.

A Reuters poll in March found nearly half of Canadians want to deport people who are illegally crossing from the U.S., so one imagines the opposition number has skyrocketed since then.

Ottawa is warning those crossing over they could be deported.

In a speech Wednesday, Trudeau said “Canada is an opening and welcoming society, but let me be clear.  We are also a country of laws....There are rigorous immigration and custom rules that will be followed.  Make no mistake.”

Most of those crossing are placed in rapidly growing refugee camps.

[Watch the hard-core Quebec nationalists (the Quebecois).  There will be violence.]

Cuba: Editorial / Washington Post

“President Barack Obama’s much-hyped restoration of relations with Cuba was a bet that diplomatic and economic engagement would, over time, accomplish what 50 years of boycott did not: a rebirth of political freedom on the island. So far, the results have been dismal. In the two years since the U.S. Embassy in Havana reopened, repression of Cubans – measured in detentions, beatings and political prisoners – has significantly increased, while the private sector has remained stagnant.  U.S. exports to Cuba have actually decreased, even as the cash-starved regime of Raul Castro pockets millions of dollars paid by Americans in visa fees and charges at state-run hotels.

“Now there’s another sinister cost to tally – the serious injuries inflicted on the U.S. diplomats dispatched to Havana.  This month, the State Department announced that two Cuban embassy staff had been expelled from Washington because of ‘incidents’ in Havana that left some American diplomats and staff members with ‘a variety of physical symptoms.’ Anonymous sources speaking to various news organizations have since provided shocking details: At least 16 American diplomats and family members received medical treatment resulting from sonic attacks directed at the residences where they were required to live by the Cuban government. A number of Canadian diplomats were also affected.

“CBS News reported that a doctor who evaluated the American and Canadian victims found conditions including mild traumatic brain injury, ‘with likely damage to the central nervous system.’  According to CNN, two Americans evacuated to the United States were unable to return to Havana, while others cut short their tours of duty.

“The State Department is saying that it has not identified the source of the attacks, though it is holding the Cuban government responsible under the Vienna Convention, which requires host governments to protect diplomatic personnel. Some news reports have passed along speculation that rogue Cuban security forces might be to blame, or perhaps a third country interested in disrupting Cuba’s rapprochement with the United States.  Such theories must be weighed against facts there: Cuba is a small, highly disciplined police state where next to nothing goes unobserved by the regime – much less high-tech assaults on foreign diplomats.”

Venezuela: Friday, the White House slapped further financial sanctions on this hell-hole, ratcheting up tensions and making it harder for President Nicolas Maduro to raise badly needed funds to prevent a debt default.

The sanctions prohibit financial institutions from providing new money to the government or state oil company PDVSA.  I’m not sure exactly how this will work, so more next time as warranted.  For now, you don’t want to further hurt the impoverished, starving people there.

But this is clearly a move against Maduro’s creation of the fake constitutional assembly that is made up entirely of government loyalists.

I keep repeating, take Maduro out.  Drop him from a helicopter into the sea and let the sharks rip this idiot to shreds.

Random Musings

--Presidential tracking polls....

Gallup: 34% approval for President Trump, 60% disapproval
Rasmussen:  42% approval, 56% disapproval

In a new Quinnipiac University Poll, Trump’s job approval is 35%, 59% disapproving, down from a 39-57 split in its prior survey.  [Since the beginning of his presidency, for the Quinnipiac poll, Trump’s approval rating has ranged from 42%, Feb. 7, to 33%, Aug. 2.]

Republicans approve of Trump 77-14; white voters with no college, 52-40, and white men approve by 50-46.

American voters disapprove 60-32 percent with Trump’s response to the events in Charlottesville.  59% say Trump’s decisions and behavior have encouraged white supremacist groups.

Since Trump’s election, “the level of hatred and prejudice in the U.S. has increased,” 65% of voters say, while 2% say it has decreased and 32% say it hasn’t changed.

“One word – Charlottesville. Elected on his strength as a deal-maker, but now overwhelmingly considered a divider, President Donald Trump has a big negative job approval rating and low scores on handling racial issues,” said Tim Malloy, assistant director of the Quinnipiac University Poll.

On the issue of removing Confederate statues from public spaces, voters oppose removal by a 50-39 margin.  White voters oppose removal 57-33, with black voters supporting removal 67-21.

White supremacist groups pose a threat to the U.S., 64-34, according to voters.

By a 61-36 margin, voters do not believe President Trump is honest.  68% do not believe he is level headed, 29% do.

Voters also disapprove 55-40 of the way the news media covers Trump, and disapprove 62-35 of the way the president talks about the media.

In a new Washington Post-ABC News poll, Trump has an overall approval rating of 37%, compared with 36% in July.

Regarding his handling of the Charlottesville protests, more than 6 in 10 Republicans approve of the president’s response, with an overall approval rating of 80% among the elephants, though the number that approves “strongly” – just about half of the GOP – is down 10 percentage points from last month, and this was before Tuesday’s performance in Phoenix.

The Post-ABC survey found that roughly 1 in 6 Americans either support the alt-right or say it is acceptable to hold white supremacist or neo-Nazi views.  This subgroup approves of Trump’s overall job performance by a 54-43 margin.

Political independents disapprove of Trump’s response to Charlottesville 55% to 28%.  84% disapprove.

In a Marist College survey for NBC News, looking at the three states that put President Trump over the top last year, Pennsylvania, Michigan and Wisconsin, several numbers should be disturbing for the White House.

Among people who voted for him last year, 19% in Pennsylvania, 16% in Michigan, and 23% in Wisconsin now do not approve of his performance in office.

So this means among those who backed him, 81% approve in Pennsylvania, 84% in Michigan, and 77% in Wisconsin.

In terms of job approval, among all voters, 33% approve of how Trump is doing in Pennsylvania, 36% in Michigan, and 33% in Wisconsin. 

Of course this doesn’t mean Trump would lose these three in 2020, it’s too far away, but worth watching, especially with the 2018 results.

--Trump senior adviser Sebastian Gorka was fired as part of the news dump tonight.  Good riddance.

--The Hill’s Ben Kamsar and Lisa Hagen identify the seven most vulnerable Senate seats in 2018.

Sen. Dean Heller (R-Nev.), Sen. Claire McCaskill (D-Mo.), Sen. Joe Donnelly (D-Ind.), Sen. Jeff Flake (R-Ariz.), Sen. Joe Manchin (D-W.Va.), Sen. Heidi Heitkamp (D-N.D.), and Sen. Jon Tester (D-Mont.).

So for all the concern among Republicans, five of the seven are Democrats.

Flake wouldn’t ordinarily be on the list in a normal year, but Trump threatening to support a primary challenge doesn’t help.  In Manchin’s case, West Virginia went to Trump by 42 points, and you have Gov. Jim Justice recently switching to the Republican side.  Of course I, like a lot of folk, have been waiting for Manchin, who I like, to do the same.

Others who could be vulnerable are Democratic Sens. Bill Nelson (Fla.), Bob Casey Jr. (Pa.), Tammy Baldwin (Wis.), Debbie Stabenow (Mich.) and Sherrod Brown (Ohio), all by virtue of running in states Trump won, though The Hill says they aren’t as vulnerable as the others.

Kid Rock is still mulling a bid in Michigan against Stabenow, and according to the above-mentioned Marist survey, he has a 38% favorable rating in the state, with 32% having an unfavorable view.  30% say they have never heard of him or are unsure how to rate him.

--The Republican National Committee outraised the Democratic National Committee in July, $10.2 million to $3.8 million.  This is the lowest amount raised by the DNC in July since 2007. 

Through the first seven months of the year, the RNC had raised $86.5 million, while the DNC had raised about $42 million.  And the GOP has $47.1 million cash on hand to the donkey’s $6.9 million.  [The Hill]

--The U.S. Navy dismissed Vice Adm. Joseph Aucoin as commander of the Seventh Fleet after four collisions involving warships in Asia in the past year.

The latest tragedy occurred Monday, when the USS John S. McCain collided with an oil tanker near Singapore, with one dead, nine missing and presumed dead.

The Seventh Fleet, based in Yokosuka, Japan, is the largest forward-deployed fleet in the U.S. Navy, with some 50 to 70 vessels and submarines.  Aucoin was its commander since 2015 and was due to retire within weeks.

The collision, before dawn, left a large hole in the destroyer’s port side – the left-hand side of the vessel facing forward – and flooded compartments including crew berths.

Just two months ago, seven U.S. sailors were killed when the USS Fitzgerald collided with a container ship in Japanese waters. Those killed were also in flooded berths after the collision caused a gash under the warship’s waterline.

The Navy has launched a review that includes a “deliberate reset” for ships that focuses on navigation (the preliminary reading on the McCain is ‘steering malfunction’), maintaining mechanical systems and manning the ship’s bridge appropriately, this last one a major factor behind the collision of the USS Fitzgerald.

Talk of a possible cyberattack on some of the vessels involved in the accidents is just that at this stage.

--Another move by the White House late Friday...we learned President Trump signed the directive that precludes transgender individuals from joining the military, but it gives Defense Secretary Mattis wide discretion in determining whether transgender personnel currently in the armed forces can continue to serve.

Mattis has six months to develop a plan to implement Trump’s order. The directive also applies to the Dept. of Homeland Security and the Coast Guard.

--According to a USA TODAY report, the Secret Service is facing a strain on its budget due in part to President Trump’s large family and multiple properties, with Secret Service Director Randolph “Tex” Alles saying some 1,100 agents will soon hit their overtime allowance caps for the year.

Under Trump, 42 people receive protection, an increase from the 31 during the Obama administration.  The Secret Service said it has faced similar situations in recent years.

--Jon Meacham / New York Times...on the statuary debate; Meacham having grown up on Missionary Ridge, a Civil War battlefield overlooking Chattanooga, Tenn.

“In the ensuing chaos (from the Charlottesville violence), President Trump spoke of the ‘many sides’ of the debate and defended the neo-Confederate view.  ‘I wonder,’ Mr. Trump said, ‘is it George Washington next week, and is it Thomas Jefferson the week after?  You know, you really have to ask yourself, where does it stop?’

“To me, the answer to Mr. Trump’s question begins with a straightforward test: Was the person to whom a monument is erected on public property devoted to the American experiment in liberty and self-government?  Washington and Jefferson and Andrew Jackson were.  Each owned slaves; each was largely a creature of his time and place on matters of race.  Yet each also believed in the transcendent significance of the nation, and each was committed to the journey toward ‘a more perfect Union.’

“By definition, the Confederate hierarchy fails that test.  Those who took up arms against the Union were explicitly attempting to stop the American odyssey.  While we should judge each individual on the totality of their lives (defenders of Lee, for instance, point to his attempts to be a figure of reconciliation after the war), the forces of hate and of exclusion long ago made Confederate imagery their own.  Monuments in public places of veneration to those who believed it their duty to fight the Union have no place in the Union of the 21st century – a view with which Lee himself might have agreed.  ‘I think it wiser,’ he wrote in 1866, ‘not to keep open the sores of war.’

“Of course, Lee lost that struggle, too, and my home state is dealing with just this issue at the moment.  In 1973, the Sons of Confederate Veterans raised money to install a bust of Nathan Bedford Forrest, the Southern cavalry commander and early leader of the Klan, in the state capitol.”

I know a little something on Forrest, and I’ve driven through Pulaski, Tenn., on my way to Shiloh years ago, and I’ll leave it at that.  [If you don’t know the significance of Pulaski, that’s your homework assignment.]

Meacham:

“ ‘There will never be peace in Tennessee,’ Union Gen. William T. Sherman once said, ‘until Forrest is dead.’  Like his more celebrated remark that war is hell, Sherman was onto something. The good news in this grim period of 2017 is that reasonable Southerners may be ready to give peace a chance.”

[The same trip I went to Shiloh Battlefield, to do research on Gen. Lew Wallace, who had a defining moment there for the Union, which he then used in his book, “Ben-Hur,” I also made a pilgrimage to the home of Sheriff Buford Pusser.  What a fascinating, and tragic, figure he was.  He survived numerous assassination attempts, only to die in a high-speed car crash in his beloved Corvette, just as he was about to star as himself in the sequel to “Walking Tall,” a popular movie of its era based on his crime-fighting story.]

--So how many military bands are there?  Try 136!  I was shocked to read this in the current issue of Army Times. This number is under scrutiny by the Government of Accountability Office.  The GAO outlined in a report how the services have yet to “develop objectives and measures to assess how their bands are addressing the bands’ missions, such as inspiring patriotism and enhancing the morale of troops.”

There are about 6,500 uniformed personnel, at a cost of $260 million a year, that are serving as musicians, the GAO found. The Army has the most bands at 99; the Air Force 14; the Marine Corps 12 and the Navy 11.

Almost all military musicians are combat deployable, but most are deployed to provide music, not to fight.

Seems to me you could lop off at least $100 million, starting with some of the woodwinds, though you need a flute or two for most of Sousa’s marches.

--Louise Linton, the Scotland-born actress and wife of U.S. Treasury Secretary Steven Mnuchin, embarrassed herself and the White House some when she posted a photo of herself exiting a U.S. government aircraft after a flight from Kentucky. She was holding a Hermes Birkin handbag, a brand and model that sells for more than $10,000, and her post included hash tags of the designer clothes, shoes and sunglasses she was wearing.

Not exactly the image the administration wants to portray in terms of working for the little guy in America.

On social media, Linton responded to an Oregon woman who criticized her “little getaway,” writing, “I’m pretty sure we paid more taxes toward our day trip than you did.” And then Linton said she’s “pretty sure the amount we sacrifice per year is a lot more than you’d be willing to sacrifice if the choice was yours,” adding, “you’re adorably out of touch.”  That, friends, is a jerk.

--The Palm Beach Zoo and Conservation Society has joined a growing list of charities and organizations in canceling events at President Trump’s Mar-a-Lago resort following his post-Charlottesville comments.

It seems the zoo’s elephants aren’t happy, and when you are the titular head of the Republican Party, if you lose the pachyderms, you’re toast.

--Wired magazine had a fascinating interview with astronaut Scott Kelly, whose last mission was 340 days on the International Space Station (ISS).  Among the questions....

WIRED: What did you miss most during your year on the ISS?

KELLY: Toward the end, I noticed little things were bothering me.  Like sitting at a table and having to keep track of my spoon. But mostly what you miss is people.  Friends and family. And weather. Even just the wind, rain, sun, going outside.

WIRED: You probably had a lot of time to watch TV, though.

KELLY: We watched Gravity in space, which was a pretty funny thing to do – like watching a movie of your house burning down while you’re inside of it. Watched The Martian.  But really more CNN than anything else. That and football.

Kelly has written a book on his long career as an astronaut, Endurance, which sounds terrific.

--In the Aug. 28 issue of TIME, there was the following blurb:

“A 106-year-old fruitcake was discovered in a hut on Cape Adare, Antarctica, that was used by British explorer Robert Falcon Scott during his final, fateful 1911 expedition. The Antarctic Heritage Trust said the cake was in ‘excellent condition.’”

Yes, the legend of the fruitcake lives on.

--Time for your editor to get in trouble with a very sexist statement...at least some may see it that way.

I’ve been to Lebanon twice and have written the women there are among the most beautiful in the world.  [I also said that of Slovenians, long before I knew of Melania’s heritage.]

So I have to make note of the news that a recent winner of the Miss Lebanon pageant, the drop-dead gorgeous Amanda Hanna, had her title removed after one week when it was revealed she had an academic trip to Israel in 2016.  To go to Israel, as a Lebanese, is illegal because Lebanon remains in a state of war with Israel, the most recent conflict being in 2006.

Ms. Hanna stayed positive and wrote on Facebook: “It has been one of the best weeks of my life, where I have, among other things, had to go around in Lebanon & visit wonderful places... I am incredibly happy that I participated.”

You go, girl!

It was in 2015 that the then-Miss Lebanon, Sally Greige, was told her status would be removed as the Lebanese contestant in the Miss Universe pageant after a selfie of her including Miss Israel was posted on Instagram.  Greige claimed that posing with Miss Israel was unintentional and was able to maintain her title.

So I went to Lebanon in 2005, weeks after the assassination of Rafik Hariri, and returned in 2010, and I haven’t been to Israel, which is on my bucket list.  But I guarantee you I’d be questioned extensively at either Newark Airport or Ben Gurion if I ever went.  It’s just the way these things work.  Lebanon and Israel will be at war again, a serious one, within three years, and it will be because of Iran.

--Iconic civil rights activist and comedian Dick Gregory died last weekend at the age of 84.

Gregory broke racial barriers in the 1960s as one of the first black standup comics to connect with white audiences (but not me, I hasten to add...I was a Richard Pryor man myself, among those of that ilk).

One of Gregory’s more famous comments, though, is indeed pretty funny:

“Where else in the world but America could I have lived in the worst neighborhoods, attended the worst schools, rode in the back of the bus, and get paid $5,000 a week just for talking about it?”

In later years, Gregory preached the virtues of prayer, non-violence, vegetarianism and raw food diets.

--Writing in The Atlantic, Peter Beinart made the following comment about Antifa:

“Antifa believes it is pursuing the opposite of authoritarianism.  Many of its activists oppose the very notion of a centralized state.  But in the name of protecting the vulnerable, anti-fascists have granted themselves the authority to decide which Americans may publicly assemble and which may not. That authority rests on no democratic foundation.  Unlike the politicians they revile, the men and women of antifa cannot be voted out of office. Generally, they don’t even disclose their names....

“Revulsion, fear, and rage are understandable.  But one thing is clear. The people preventing Republicans from safely assembling on the streets of Portland [Ed. Portland, OR, has a huge, ongoing problem with anarchists] may consider themselves fierce opponents of the authoritarianism growing on the American right.  In truth, however, they are its unlikeliest allies.”

--The World War II heavy cruiser USS Indianapolis was found in the Pacific Ocean, 72 years after its sinking by a Japanese submarine.

The Indianapolis was destroyed returning from its secret mission to deliver parts for the atomic bomb that was later used on Hiroshima.

It was discovered 18,000 feet beneath the surface in the Philippine Sea; Microsoft co-founder Paul Allen leading the civilian search team.  Allen said the discovery was “truly humbling.”

I imagine there are many younger folk who don’t know the story of the Indianapolis, of how 1,196 men were on board, and when the survivors were finally discovered in the water, four days later, just 316 were still alive.

There was no distress call because of the mission, carrying parts for the atomic bomb nicknamed “Little Boy” as well as enriched uranium fuel for its nuclear reaction.  Those supplies were delivered to Tinian Island*, an American base from which was launched the world’s first nuclear bombing.

Four days later, though, the Indianapolis sank – less than a week before the nuclear bomb it helped to make destroyed Hiroshima.

The exact location of the discovery is to remain a secret forever as it is a grave site.  Allen turned over the details to the U.S. Navy.  [But I do know it was somewhat close to my beloved island of Yap, in relative terms, probably the closest major island to it, that or Palau.  That’s my guess.]

*In keeping with my recent Guam lessons, when you take the quick flight from Guam to Saipan, as I did one year, you fly over Tinian, only I was kicking myself years later for not remembering as I looked down on it that it was the island from where the Enola Gay took off.

The sinking of the Indianapolis is featured in the movie “Jaws;” Quint, Brody and Hooper on their boat, hunting for the shark, when Brody points to one of Quint’s scars.

Brody:  What’s that one?...That one, there, on your arm.

Quint: Oh, uh, that’s a tattoo, I got that removed.

Hooper asks: What is it?

Quint: Mr. Hooper, that’s the USS Indianapolis.

Hooper: You were on the Indianapolis?  [Hooper knowing the history, Brody not knowing.]

Brody: What happened?

Quint then tells him, the full, gruesome tale.

You all can look up the clip on YouTube, but I read the script yesterday and it is very factual.  Out of respect to those who died on the Indianapolis, I won’t retell it here. 

Let’s just say, as I close every week, we keep them forever in our thoughts.

And Paul Allen deserves a special award for his patriotism.

---

Pray for the men and women of our armed forces...and all the fallen, including the victims of the USS John McCain.

Remember the Indianapolis.

God bless America.

---

Gold $1296
Oil $47.86

Returns for the week 8/28-9/1

Dow Jones +0.6%  [21813]
S&P 500  +0.7%  [2443]
S&P MidCap  +0.9%  [1708]
Russell 2000  +1.5%  [1377]
Nasdaq  +0.8%  [6265]

Returns for the period 1/1/17-9/1/17

Dow Jones  +10.4%
S&P 500  +9.1%
S&P MidCap  +2.9%
Russell 2000  +1.5%
Nasdaq   +16.4%

Bulls  48.1
Bears  18.3  [Source: Investors Intelligence]

Have a great week.  Prayers for Texas and Louisiana.

Brian Trumbore

 



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Week in Review

08/26/2017

For the week 8/21-8/25

[Posted 11:30 PM ET, Friday]

Note: StocksandNews has significant ongoing costs and your support is greatly appreciated.  Please click on the gofundme link or send checks to PO Box 990, New Providence, NJ 07974.  Special thanks to longtime supporter Jim D. 

Edition 959

Another extraordinary week...and far from a good one when you factor in Hurricane Harvey, which appears to be next week’s lead if the computer models are correct.

I have plenty to say about our president, and the news he dumped on us tonight is interspersed throughout.  Recognize I obviously don’t have time to comment fully on each of tonight’s items, except to say his tweets on the hurricane have been beyond insipid.

I’ll just say for now that I was embarrassed by Trump’s performance in Phoenix, while at the same time recognizing his 35% base isn’t leaving him. I understand.  I don’t agree, but I get it, putting my poli-sci hat on.

But if you wanted a divider-in-chief, well, you got him.  How this is good for America, in both the short and long term, feel free to tell me.  

I start out with Afghanistan, however, and I have no problem with the president’s strategy.  Yes, the speech was lacking in detail, but I’ve never been in the cut-and-run camp when it comes to this one.  I like how both the Wall Street Journal and Washington Post editorial boards sum it up below.  Afghanistan is likely to be no different than what we’ve had for decades in Europe, the Gulf, and on the Korean Peninsula.  If you want all of these forces to come home in the belief we’d then be singing Kumbaya the rest of our lives, exchanging warm pies with our neighbors, you’re sadly mistaken.

The world sucks...film at eleven.

But what I’m worried about in the next month or so, aside from any mischief from Kim Jong Un, is what Vladimir Putin will do when he commences his massive war games in Russia and Belarus in September, and whether he leaves large numbers of troops behind after completion to menace the border countries, or actually makes a move on one.

This is going to be a crazy fall.  Chinese President Xi Jinping, one of the truly bad people on the planet, will be solidifying power at the Communist Party Congress, and I believe he’ll ask not just for a second five-year term, but a third, while further consolidating power, and repressing his people.  If I were Taiwan, I would not be sleeping comfortably.

But for now, I’m going to keep reporting the facts as best I can, while mixing in a little opinion.  And so we begin....

Trump World...Afghanistan....

Monday night, in a sober speech to the American people from Fort Myer, Va., President Trump assured us that the United States will win the war in Afghanistan.

“The American people are weary of war without victory. I share the American people’s frustration,” but “in the end, we will fight and we will win.”

The president declined to commit to a specific troop increase amid rumors of one of nearly 4,000 from a stated 8,400 (more on this below), with the existing forces on a dual mission of training, advising and assisting Afghan forces, while conducting counterrorism missions against groups such as al Qaeda and ISIS.

“A core pillar of our new strategy is a shift from a time-based approach to one based on conditions. I’ve said it many times how counterproductive it is for the United States to announce in advance the dates we intend to begin, or end, military options.”

Trump acknowledged he was reversing course.

“My original instinct was to pull out, and historically I like following my instincts, but all of my life I’ve heard that decisions are much different when you sit behind the desk in the Oval Office,” he said.

“A hasty withdrawal would create a vacuum that terrorists – including ISIS and Al Qaeda – would instantly fill, just as happened before Sept. 11.”

Trump dubbed his new approach, “principled realism.”

“I share [Americans’] frustration over a foreign policy that has spent too much time, energy, money, and most importantly lives trying to rebuild countries in our own image instead of pursuing our security interests above all other considerations,” Trump said.

“Ultimately it is up to the people of Afghanistan to take ownership of their future... We are not nation building again. We are killing terrorists,” he added.

As for Pakistan, Trump vowed to pressure them more.

“We can no longer be silent about Pakistan’s safe havens for terrorist organizations, the Taliban, and other groups that pose a threat to the region and beyond.  Pakistan has much to gain from partnering with our effort in Afghanistan. It has much to lose by continuing to harbor criminal terrorists.”

Trump hinted at withholding aid, which the U.S. has done before.

“We have been paying Pakistan billions and billions of dollars at the same time they are housing the terrorists that we are fighting. But that will have to change, and that will change immediately,” Trump vowed.

“It is time for Pakistan to demonstrate its commitment to civilization, order and to peace.”  [For its part, Pakistan was perplexed, and pissed.]

Trump also urged India to raise their contribution to the fight in Afghanistan “in line with our own,” highlighting the fact India is making $billions in trade with the Afghans while shouldering virtually zero of the burden. 

The president did not define what victory would look like, and on Tuesday, Secretary of State Rex Tillerson played down the idea the U.S. military would walk away from Afghanistan in triumph.

Addressing the Taliban directly, Tillerson said: “You will not win a battlefield victory. We may not win one, but neither will you.”

Boy, that Rex Tillerson is one tough hombre.

According to the Wall Street Journal, there are actually more than 12,000 U.S. troops in Afghanistan today, not the 8,400 publicly acknowledged. The Pentagon only discloses those deployed for longer periods while not counting those moving in and out on temporary status.  So the U.S. might only be technically adding 500 or so to meet the president’s goal.

While the administration’s new Afghan strategy strengthens the government in Kabul, many warn that Pakistan could deepen its ties with China, which, in turn, is in the midst of a border conflict with India, Pakistan’s chief enemy.

Pakistani officials have long said there is no military solution and that the only route is peace talks with the Taliban, not additional U.S. troops.

Afghan President Ashraf Ghani said, “The U.S.-Afghan partnership is stronger than ever in overcoming the threat of terrorism that threatens us all. The strength of our security forces should show the Taliban and others that they cannot win a military victory.  The objective of peace is paramount.”

Friday, a suicide bomber detonated himself at the gate of a Shiite mosque in Kabul, with other attackers storming the building, and at least 30 were killed as worshippers were gathering for Friday prayers.  ISIS claimed responsibility.

There was a time when Kabul was relatively safe, but not the past year.

Opinion....

Editorial / Wall Street Journal

“President Trump inherited a mess in Afghanistan, so give him credit for heeding his generals and committing to more troops and a new strategy. His decision has risks, like all uses of military force, but  it will prevent a rout of our allies in Kabul and allow more aggressive operations against jihadists who would be delighted to plan global attacks with impunity.

“Also give him credit for explaining a matter of war and peace to the American people Monday in a serious, thoughtful speech. Barack Obama unveiled his Afghan strategy in a major speech in 2009 and then tried to forget about the place. Mr. Trump should continue making the case for his strategy in more than Twitter burst.

“The heart of the new strategy is a commitment linked not to any timeline but to ‘conditions’ on the ground and the larger war on terror. ‘We are not nation-building again. We are killing terrorists,’ he said, in a line that will resonate with his political base even if building the Afghan defense forces is part of the goal.

“Mr. Obama’s great anti-terror mistake was imposing political limits that made it harder to succeed. He did this in Afghanistan at the start of his surge when he put a timeline on withdrawal. And he did it at the end of his term when he refused to let U.S. forces target Taliban soldiers even when they were killing our Afghan allies.

“Mr. Trump said he is lifting ‘restriction’ from Washington on the rules of military engagement. This means going after jihadists of all stripes, and it gives the generals flexibility to inflict enough pain on the Taliban that they begin to doubt they can win....

“Mr. Trump’s most significant shift – if he can follow through – is the challenge to Pakistan.  ‘We have been paying Pakistan billions and billions of dollars at the same time they are housing the very terrorists that we are fighting,’ he said.  ‘But that will have to change, and that will change immediately.’

“History shows that a key to defeating an insurgency is denying the kind of safe have that Pakistan provides the Taliban and the closely allied Haqqani network. Mr. Trump’s implication is that Pakistan must help in Afghanistan or face a cutoff in U.S. aid and perhaps cross-border strikes against terrorists inside Pakistan.  Pakistani military leaders have never taken such a U.S. threat seriously, and if they play the same double game Mr. Trump will have to show he means it.

“The Taliban now control as much as 40% of Afghan territory. But if the U.S. and Afghan army can stabilize more of the country, while training more Afghans to be as effective as its special forces have become, a diminished Taliban threat is achievable.  The Afghan government will also have to do its part by providing better governance.  Taliban leaders will have to be killed, but its foot soldiers might decide over time they can live with the government in Kabul....

“As Mr. Trump acknowledged, the U.S. public is wary of spending money on war without results. But Americans have also shown they will support commitments abroad for decades as long as casualties are low and they serve U.S. security interests. That’s true in South Korea, Europe and the Persian Gulf. The long war against jihadists will require similar commitments abroad.

“Mr. Trump campaigned against overseas entanglements, but America’s foreign commitments can’t be abandoned without damaging consequences.  Mr. Trump has now made his own political commitment to Afghanistan, and his job will be maintaining public support and congressional funding.  These obligations go with the title of Commander-in-Chief.”

Editorial / Washington Post

“Mr. Trump deserves credit for changing his position in a  way that is likely to displease some of his political supporters. The U.S. mission in Afghanistan will continue – not because a quick victory is on the horizon; it’s not, as Mr. Trump seems to understand. It will continue, because as Mr. Trump also came to understand, the alternative – a quick defeat – would be so much worse....

“The absence of a clear exit strategy can be a danger in its own right, and Mr. Trump stressed that ‘our commitment is not unlimited, and our support is not a blank check.’  But the reality is that preventing Afghanistan’s return to its state before 2001 is worth even a prolonged continuation of U.S. troop deployments and the inevitable fatalities that come with them. ...Though some describe Afghanistan as America’s longest war, it can also be compared with U.S. military deployments in Germany, Japan and South Korea, which have lasted far longer and which, as the Pacific naval accidents this summer underlined, also have their cost in lives.”

Editorial / New York Post

“All in all, this was a much-needed pragmatic realignment of U.S. policy – in this war and beyond. Some honorable peace with elements of the Taliban is possible down the line; India does need to step up if it wants to stop being written off. America may yet have to leave Afghanistan to its own devices, if Afghan leaders won’t do their share.

“On Monday, Donald Trump was an American president doing his job with all his heart, and his head.”

---

Yes, Monday, Donald Trump was presidential.  Tuesday, addressing his 35% base in Phoenix, Arizona, he gave an appalling performance. It was beyond nonsensical, and all about him.

Trump used up over 20 minutes of a 70-minute+ presentation with a diatribe against the “damned dishonest” press, accusing the media of exacerbating racial divisions, attacking ordinary Americans, giving a platform to hate groups and of “trying to take away our history and our heritage.”

“If you want to discover the source of the division in our country, look no further than the fake news and the crooked media,” said the president.

Trump had opened with three minutes on the crowd size, and how “there aren’t too many people outside protesting,” predicting that the media would not broadcast shots of his “rather incredible” crowd and reminiscing about how he was “center stage, almost from day one, in the debates.”

There was also no doubt that towards the end of the 72-minute rant, Trump was beginning to lose the crowd.

Reaction from the media was swift, save for Trump’s lackeys at Fox News, Trump having given a shout-out to Sean Hannity (“How good is Hannity?”), who in his first monologue after on Wednesday gave his usual lines about the “unprecedented slanderous attacks by the far-left, destroy Trump media,” and how Trump is “unfairly lied about,” while Hannity totally ignored Trump’s failure to mention his week ago press conference line of “good people on both sides” that stirred everyone up, or the initial assertion that there had been violence “on many sides, many sides.”.

[Trump tweeted Wednesday, “Last night in Phoenix I read the things from my statements on Charlottesville that the Fake News Media didn’t cover fairly.  People got it!”  The tweet before read: “Phoenix crowd last night was amazing – a packed house. I love the Great State of Arizona. Not a fan of Jeff Flake, weak on crime & border!”]

Just about everyone else in the media called Trump’s performance “unhinged” and “divisive.”

Tuesday, Trump also had reckless throwaway lines; like that his administration would “end up probably terminating Nafta.”

And this one: “Believe me, if we have to close down our government, we’re building that wall.”

We had been told there would also be “no discussion” of a pardon for controversial former sheriff, Joe Arpaio, but while Trump didn’t issue one, he made it clear a pardon was in the offing.  [And it came, Friday night.]

And of course he blasted Sens. McCain and Flake, without naming them, saying things like the following, in addressing the failure to pass the effort to hollow out ObamaCare: “One vote away!  I will not mention any names.  Very presidential, isn’t it?”

So Tuesday night sucked up all the oxygen on Wednesday.

Thursday, Trump tweeted: “I requested that Mitch M & Paul R tie the Debt Ceiling legislation into the popular V.A. Bill (which just passed) for easy approval.  They didn’t do it so now we have a big deal with Dems holding them up (as usual) on Debt Ceiling approval.

“Could have been so easy – now a mess!”

Congressional leaders pushed back, saying they didn’t want to politicize veterans and risk the failure of legislation that had strong bipartisan support.

Democrat leaders said there have been no talks over the August recess between the White House and Democrats – whose votes are needed on a debt ceiling vote.

Appearing on CNBC Thursday, Speaker Ryan said, “There’s a bunch of different options in front of us.  I’m not going to, kind of, negotiate through the media, but we have a lot of options in front of us and I’m really not worried about getting this done.”

Republicans always have a tough time on the debt ceiling because Tea Party-backed conservatives have opposed any such increase without cuts to federal spending, while Democrats reject the spending cuts, and, again, you need 60 votes.

House Minority Leader Nancy Pelosi put the ball in the GOP’s court Thursday.

“With the White House, House and Senate under one party control, the American people expect and deserve a plan from Republicans to avert a catastrophic default and ensure the full faith and credit of the United States.

“With so much at risk for hard-working families, Republicans need to stop the chaos and sort themselves out in a hurry.”

Earlier, in an event with Treasury Secretary Steven Mnuchin, Mitch McConnell said, “There is zero chance – no chance – we won’t raise the debt ceiling.”  Mnuchin wants a “clean” hike.

But Congress also has to pass its annual spending bills to fund the government going forward by Sept. 30 and after its return Sept. 5, it only has a few legislative sessions to do so, which means we are probably headed towards a continuing resolution, CR, to delay the hard negotiating another few weeks or months.  Spending bills also require 60 votes in the Senate, while both spending and debt ceiling bills can pass the House by a simple majority.

And you’ve got the border wall issue. Democrats won’t take the blame for any impasse. Republicans will.

As for the negotiations on reopening the North American Free Trade Agreement with Mexico and Canada, I’ve been saying for months the administration has a misguided fixation on trade deficits. So I note the following.

Editorial / Wall Street Journal

“Free trade is always good for consumers, but Nafta has also been a boon to North American producers. Companies have allocated capital to its highest use on the continent, investing where they find a comparative advantage. Two examples are U.S. agriculture and Mexican low-skilled manufacturing. The result has been an explosion in North American trade. Total trilateral merchandise trade has grown to more than $1 trillion annually from less than $300 billion in 1993.

“Enter (U.S. Trade Representative Robert) Lighthizer’s trade-deficit preoccupation, which holds that unless Mexico buys the same dollar amount of wheat and corn from the U.S. that the U.S. buys in widgets from Mexico, Americans are losing out.  This bizarre economics is dangerous to Americans prosperity.

“One of Nafta’s many benefits to American global competitiveness is that it allows U.S. manufacturers to access low-priced intermediate goods from the neighbors, add value in the U.S., and then export the final product around the world.  Consumers at home and abroad find these U.S. products attractive because they are well-made and competitively priced thanks to continental supply chains. Workers and wages have benefitted too.  The growth of high-paying U.S. jobs in technology, innovation, design and marketing depend on this free-trade web of supply chains.

“U.S. car and truck makers benefit in particular from intracontinental trade. Production facilities in all three Nafta countries ship unfinished products across borders, often multiple times, before completion. It is not an exaggeration to say that free-trade access to labor and capital across North America is largely responsible for the survival of the U.S. auto industry.  John Bozzella, CEO of the Association of Global Automakers, told Reuters last week that U.S. auto production has increased by more than one million vehicles annually since Nafta and there has been a boom in exports. Whether the industry can survive Mr. Lighthizer is another matter....

“Mr. Lighthizer previously toiled as a trade lawyer for the American steel industry. Squeezing foreign steel producers may be another of his Nafta goals.

“Mr. Lighthizer also wants to add a new mandate that Nafta vehicles contain ‘substantial U.S. content.’* The Lighthizer logic is that this will create jobs in the U.S. Yet if higher U.S. content were good for making and selling cars around the world, the government would not have to mandate it. As Mexico’s economy minister Ildefonso Guajardo said this weekend, ‘National content is not used in any [trade] agreement in the world, because it puts too much rigidities to the companies.’....

*Nafta currently requires that 62.5% of a duty-free vehicle be made in North America.  Lighthizer wants to increase this percentage and make it country specific.

“American manufacturers, aka the job creators, have issued their own warnings.

“ ‘We certainly think a U.S.-specific requirement would greatly complicate the ability of companies, particularly small- and medium-size enterprises, to take advantage of the benefits of Nafta,’ said Matt Blunt, president of the American Automotive Policy Council that represents GM, Ford and Fiat Chrysler.

“Mr. Lighthizer says he wants to restore jobs that have been lost since 1994 when Nafta was launched. But most of those jobs were lost to technology and higher labor productivity. New employment opportunities depend on new export markets and enhanced competitiveness. Step one is to let go of the obsession with Nafta trade deficits.”

Hear hear.

On a different trade issue, however, China, the Trump administration is right.

Robert Samuelson / Washington Post

“There is much to dislike in President Trump’s trade agenda, but he is correct on one subject: China’s relentless quest to extort American ‘intellectual property’ – technologies, business methods, patents.  Trump took a swipe last week at China’s policies by ordering his top trade officials to investigate.  Whether he can alter China’s behavior is unclear, but he is right to try, even at the risk of a trade war.

“China has high economic ambitions, write David Dollar and Ryan Hass of the Brookings Institution. Its industrial policy, called ‘Made in China 2025,’ envisions the country becoming the global leader in 10 crucial sectors: information technologies, machine tools and robotics, aerospace equipment, rail transport, maritime equipment, new energy vehicles, power equipment, agricultural equipment, new materials, and advanced medical products.

“ ‘These sectors will be supported by financing from state-owned [banks and] institutions and protected from open competition,’ Dollar and Hass say.

“To get to the top, China also needs advanced know-how. Here’s where foreign companies make a bargain with the devil. The Chinese require them to surrender technology in return for the right to invest and sell in China.  There are many mechanisms: joint ventures with Chinese firms, China-based research and development centers, licensing agreements made at bargain-basement rates.

“Again, Dollar and Hass:

“ ‘American companies agree to these technology transfers because it’s the only way they can access the second-largest market in the world. ...The list of companies operating in such ventures is essentially the roll call of top American technology firms.  Intel has agreements with two Chinese chipmakers in order to get access to the market for smartphones and tablets.  IBM and Advanced Micro Devices have both licensed chip technology to Chinese partners. Qualcomm has a similar partnership. Automakers have to share their technology with local partners in order to produce and sell there.’

“To this legalized technology extortion must be added an indeterminant amount of illegal cybertheft of business secrets.  Whatever the source, the consequences hurt Americans – and Europeans, Japanese and workers in other advanced countries. All of their high-technology industries face a slow eclipse by China’s favored firms. The aim is to substitute their production for other countries’, says Rob Atkinson of the Information Technology & Innovation Foundation. He says that the government plans to spend $1.6 billion to expand its semiconductor industry.

“The danger of global overinvestment, driven by China’s subsidies, is obvious....If global gluts of production capacity emerge – as they have in steel and aluminum – and China protects its producers, then losses will fall heaviest on non-Chinese firms.”

And then there’s national security, and China’s quest to gain access to items like the F-35 Lightning.

Hell, I’ve written myself in the past of how I know there have been Chinese agents in my building here in Summit.  A shadowy figure (never friendly in the least) will move in for six months and then just leave, and these aren’t people looking for a temporary home while they find a new place to live following a transfer. I know the difference by now.  There are all kinds of targets for Chinese industrial espionage in my area.  It’s infuriating.

Samuelson:

“The larger question involves how the new world order operates.  Ideally, the United States and China would cooperate on many issues where they have similar interests. These would include a viable world trading system and the nuclear future of North Korea. So far, there’s scant evidence of this enlightened collaboration.”

Trumpets....

--Sen. Tim Scott (R-S.C.) called on President Trump to sit down with civil rights leaders around the country after what he called his “challenging” remarks blaming “both sides” for the violence in Charlottesville.

Speaking on CBS’  “Face the Nation,” the Senate’s lone black Republican said that Trump should sit down with leaders like Rep. John Lewis (D-Ga.) who have a “personal connection” to America’s “painful” racist history.

“What the president should do before he says something, is to sit down, and become better acquainted, have a personal connection to the painful history of racism and bigotry of this country,” Scott said.  “It would be fantastic if he sat down with a group of folks who endured the pain of the ‘60s...the humiliation of the ‘50s and the ‘60s.”

--Former Homeland Security Secretary Jeh Johnson said on ABC’s “This Week” that he’d tell Trump advisers “you have to stay” in the administration if any of them asked.  They need to “right the ship.”

Opinion...Phoenix speech...Charlottesville....

Laurie Roberts, The Arizona Republic

“Well, that didn’t last long.

“On Monday, President Donald Trump called for the country to come together in the wake of Charlottesville.

“ ‘A wound inflicted upon a single member of our  community is a wound inflicted upon us all,’ he said.  ‘When one part of America hurts, we all hurt. And when one citizen suffers an injustice we all suffer together.’

“So naturally, on Tuesday, Trump signaled that he’ll be pardoning Maricopa County Sheriff Joe Arpaio – a guy who for years targeted people because of the color of their skin and then for 18 months ignored a federal judge’s order to cut it out.

“ ‘I’ll make a prediction,’ Trump told a Phoenix Convention Center crowd jam packed with cheering supporters.  ‘I think he’s going to be just fine, OK?  But I won’t do it tonight because I don’t want to cause any controversy. Is that OK? But Sheriff Joe can feel good.’

“As for the rest of us, we can only feel...amazed, astonished and downright astounded by our president’s performance in Phoenix.

“One in which he led the nation to believe that no more than a few dozen misfits were protesting his appearance rather than the thousand or more Americans who took to the streets.

“One in which he talked about his growing support in Arizona, never mind a recent poll that shows his support has slipped to 42%.

“One in which he spent nearly a half four trying to rewrite history about Charlottesville, as if he never said that ‘both sides’ were to blame – the people who stood for white supremacy and the people who stood against it.

“One in which he spent 90 minutes massaging America’s biggest ego...his own.

“He said nothing new. Announced no new initiatives.

“Instead it was a red meat ranting, fragile ego stroking stream of consciousness preached to an adoring crowd of supporters.

“It was dishonest media...blah blah blah...drain the swamp...blah blah blah...build the wall...blah blah blah...Barack Obama...blah blah blah...make America great again.

“And the crowd LOVED it.

“All in all, a great campaign speech by our unifier-in-chief and just in time.

“Trump is up for re-election, after all, in just 1,168 days.”

Michael Reagan / Star-Ledger

“As we’ve said before, Donald Trump has to learn to just shut up and let things go.

“The failure to do that is the worst Achilles heel of a president who seems to have half a dozen Achilles heels.

“Because he can’t think on his feet, because he doesn’t know how to say the right thing at the right time, because he thinks he’s got to win every petty argument with the anti-Trump media, the president has mired himself unnecessarily in yet another controversy of his own making.

“This time it’s Charlottesville....

“You had the dregs of this country’s minuscule right-wing hate sector....

“You had their violence-prone left-wing opponents – organized groups like Black Lives Matter and Antifa – pouring in from out-of-state to protest the presence of the white nationalists.

“The right-wing hate groups marched around the town Nazi-style, chanting anti-Semitic and anti-black slurs, exercising their First Amendment rights and putting their moral and political ugliness on full display.

“Who didn’t know the anti-Trump media was going to be there en mass to record everything?

“Who didn’t know the liberal media would seek out a visiting professional racist like David Duke and get him to say something nice about President Trump on camera?

“Well, apparently President Trump and his staff didn’t know.

“They certainly weren’t prepared to respond to the predictable violence....

“Charlottesville should have been a no-brainer for the White House – and it should be finished business.

“The president should have read a simple prepared statement last Sunday that was written by someone who knew what to say and how to say it.

“He should have said, quickly and clearly, that the white nationalists, the KKK, the neo-Nazis and their fellow haters were despicable Americans with un-American beliefs – true deplorables, if you will.

“He should have reemphasized that they and their ilk did not speak for him or his administration.  Ditto for the David Dukes of the world.

“Then the president should have issued the standard presidential condolences and moved on to tax reform or North Korea or whatever important issue he has on his unfinished plate.

“Charlottesville was never Trump’s fight. He  should have stayed out of it – above it – and acted presidential, which, I know, is asking a lot.

“Instead he again took the media’s bait; and then did his usual clumsy job of engaging a pack of rabid reporters in full view of the world.

“He tried to equate extremist white nationalists with left-wing protest groups like Black Lives Matters.

“Like a reckless rookie unable to learn from his mistakes, QB Trump is repeatedly scrambling out of the pocket, throwing incompletions in every direction – and then blaming his blockers, receivers and cheerleaders on Twitter for his team’s negative yardage....

“He has yet to learn that when you’re the president you have to know when to shoot back, when to change the subject and when to just shut up in the first place.”

Wall Street

One thing you won’t see in a Trump tweet or in  a campaign boast is the fact that the U.S. economy is not only growing because of the notion it’s all about the president’s policies, but rather the fact that for the first time in a decade, the world’s major economies are growing in sync.

All 45 countries tracked by the Organization for Economic Cooperation and Development are on track to grow this year, with 33 poised to accelerate from a year ago.

The International Monetary Fund said in July that global GDP would grow 3.5% in 2017, and 3.6% in 2018, vs. 3.2% growth last year.

So with this as a backdrop, leaders of the world’s central banks and economists gathered at their annual forum in Jackson Hole, Wyoming, and Fed Chairwoman Janet Yellen ended up saying zippo about monetary policy.

Instead, Yellen’s speech was a sharp rebuke to assertions by President Trump and top aides that rules safeguarding the economy against another financial crisis need to be rolled back.

“The evidence shows that reforms since the crisis (read ‘Dodd-Frank’) have made the financial system substantially safer,” Yellen said.  Trump has said that post-crisis regulations went too far, calling Dodd-Frank a “disaster” that has made it hard for consumers and businesses to access credit and restricted growth. One of his arguments is that banks are required to hold too much capital, thus making it harder to lend.

Yellen did acknowledge that some borrowers may find it more difficult to attain credit.

But if Yellen wanted another four-year term as Fed Chair, and Trump has said nice things about her recently, she may have cooked her goose with the stance against rolling back banking rules.

Ditto, Gary Cohn, who is said to be interested in replacing Yellen, only Trump may be rather ticked at him today because of an interview Cohn granted the Financial Times, wherein he blasted the president’s handling of Charlottesville.

“I believe this administration can and must do better in consistently and unequivocally condemning (white supremacists and neo-Nazis) and do everything we can to heal the deep divisions that exist in our communities. Citizens standing up for equality and freedom can never be equated with white supremacists, neo-Nazis, and the KKK.”

Cohn added that he felt “compelled to voice my distress over the events of the last two weeks, and that he had drafted a letter of resignation, while coming under intense pressure to quit over Trump’s reaction to the incident, but decided against it, adding:

“As a Jewish American, I will not allow neo-Nazis ranting ‘Jews will not replace us’ to cause this Jew to leave his job.”

[Cohn also spoke of tax reform in the FT interview and he hopes legislation effecting same is passed by year end; a belief shared by Treasury Sec. Mnuchin.]

Back to the U.S. economy, July new home sales came in far less than expected, 571,000 annualized pace, but the two prior months were revised upwards. 

Existing-home sales for the month also fell short to the lowest pace of 2017, 5.51 million.

The median existing-home price in July was $258,300, up 6.2 percent from July 2016, the 65th straight month of year-over-year gains.

Friday, the durable goods (big-ticket items) figure for July was -6.8%, but this is deceiving.  The better barometers, ex-transportation and business spending (capex) were up 0.5% and 0.4%, respectively, which is solid.

Europe and Asia

Just a few tidbits on the eurozone.

Markit released its flash readings for August and the eurozone manufacturing PMI came in at 57.4 vs. 56.6 in July...50 being the dividing line between growth and contraction, with services at 54.9 vs. 55.4 last month.

Recall, the flash estimates then break down just France and Germany, specifically.

Germany’s manufacturing figure is 59.4 vs. 58.1 in July, while non-manufacturing came in at 53.4 vs. 53.1.

In France, manufacturing was at 55.8 vs. 54.9, services at 55.5 vs. 56.0 last month.

All in all, more solid readings.

Andrew Harker / IHS Markit:

“The latest PMI readings for the eurozone signal a continuation of the recent strong performance of the currency bloc’s economy.  This stabilization in the rate of expansion is pleasing, following signs of growth easing in recent months.”

Yes, the current quarter should show growth of 0.5% to 0.6% over the second quarter’s 0.6% rise. This is good.

Separately, European Central Bank President Mario Draghi is confronted by an economy where robust growth is accompanied by anemic inflation.

“(John Maynard) Keynes is often quoted as saying, ‘When the facts change, I change my mind,’” Draghi said recently.  “Well, for policymakers, it is not that simple... We must be aware of the gaps that still remain in our knowledge.”

So Friday, he was in Jackson Hole, with Chair Yellen, and Draghi said that global trade and cooperation were under threat, a risk to growth in advanced economies.  He added that the current environment of easy monetary policy makes a major relaxation of financial regulation dangerous.

“Given the large collective costs that we have observed, there is never a good time for lax regulation.”

But, like Yellen, Draghi didn’t address current monetary policy, except in a Q&A after, when he said that while he was confident the ECB’s 2% inflation target would be met, he urged patience when it came to the bank’s ultra-easy monetary policy. 

Eurobits....

--On the Brexit front, the U.K. published a flood of documents this week, but stayed mum on the big issue for the people at the moment: just how much money will it be forced to cough up to the European Union for exiting.

Formal talks resume next week and Britain has less than eight weeks to convince the EU it has done enough to begin trade discussions.  But nothing moves forward without the U.K. and EU agreeing on a final bill for all of the former’s future obligations (think pensions for EU staff, among other financial matters).

The U.K. doesn’t want to get drawn into the money issue just yet, while the EU, accepting that the two sides don’t have to agree on a figure today, still must come up with a method of calculating the final figure.

The EU wants to base its bill on past commitments, but Britain is saying it should be partly determined by the scope of its future access to EU markets.  So it’s a chicken and egg deal.  It’s also a huge political issue for Prime Minister Theresa May.

As for the documents that were released this week, the EU seems unimpressed because while Mrs. May is focused on future relations, the EU first wants to address the Irish border, protection for Europeans living in the U.K. and the divorce bill.  Plus, you’re talking about the desires of 27 different nations.

But the U.K. did appear to climbdown on the issue of the European Court of Justice. The prime minister had declared the U.K. would “take back control of our laws and bring an end to the jurisdiction” of the ECJ, but now her government is seeking to bypass just the body’s “direct jurisdiction.”

So this means EU judges would have some say in the U.K. post-Brexit. The test will be if EU officials accept the shift was enough to speed up negotiations.

There is simply no way the EU is signing a deal without the bloc’s judges having some long-term influence in the U.K., particularly when it comes to the rights of its citizens living in Britain.

Much more next time with the talks resuming in Brussels.

Separately, the U.K. food industry warned that a Brexit workforce shortage could leave a third of its businesses unviable.

31% of the businesses in the sector have already seen EU workers leave the U.K., according to the Food and Drink Federation.  This organization is calling on the government to guarantee the rights of nationals from across the European Economic Area.

Along the lines of the above, the government announced that net migration to the U.K. has fallen to the lowest level in three years after a surge in the number of EU nationals leaving since last June’s Brexit vote.

For March 2017, the figure was 246,000 (difference between those entering and leaving), though the U.K. is committed to reducing net migration to below 100,000.

There was some good news.  Britain’s Society of Motor Manufacturers and Traders reported the number of cars built in the U.K. last month rose by 7.8% over last year, though the number made in the first seven months fell 1.6%.  Almost four out of five cars rolling off British production lines are exported.  [And of course other nations are exporting to the U.K.]

But the number of new cars registered in the U.K. (sales) fell almost 10% in July  - the fourth month of declines.

--French President Emmanuel Macron really stirred up a hornet’s nest in a trip to various Central and Eastern European countries this week.  Macron said on Friday that Poland was isolating itself in Europe and that its citizens “deserve better” than their government’s refusal to seek compromise on European rules on the employment of labor from low-pay nations.

“Europe is a region created on the basis of values, a relationship with democracy and public freedoms which Poland is today in conflict with,” Macron said, at the Black Sea resort city of Varna.  “Poland is not defining Europe’s future today, nor will it define the Europe of tomorrow.” [Reuters]

Macron was alongside Bulgaria’s President Rumen Radev, and Macron wants both Poland and Bulgaria to help the EU negotiate through one of Macron’s hot-button topics, the issue of posted worker rules.

What is this?  It’s the battle between the rich west and poor east.

Companies have long profited from rules that allow them to “post” workers from one country to another, but a backlash has been growing across northern Europe amid evidence employers are taking advantage of the rules to hire low-wage foreign workers, say from Eastern Europe, at the expense of local citizens, a big recent campaign issue in France.

Macron had promised to protect his fellow Frenchmen from “unfair competition” from the east, and thus the purpose of his trip to Central and Eastern Europe.

“Do you think I can explain to the French that businesses are closing in France to move to Poland while construction firms in France are recruiting Polish workers because they are cheaper?” Macron said in a recent interview with European newspapers.

But this charge has infuriated the governments of the likes of Poland, Hungary and the Czech Republic.  They accuse Macron of protectionism, and wonder why France and its ilk aren’t instead cracking down on employers abusing the system.

So Macron has suggested new rules to limit to one year the length of time an employee could be posted to another European Union country.

--Chancellor Angela Merkel is well on her way to victory Sept. 24 in Germany’s national elections, and so in an attempt to draw a distinction between his candidacy and hers, opponent Martin Schulz of the Social Democrats demanded the U.S. withdraw its nuclear weapons from the country, as he takes an increasingly anti-American tack.

As for Merkel, she defended Donald Trump, saying she’s obliged to treat him with respect because he won the U.S. presidential election fair and square, though she added she will vigorously pursue German interests when policies clash.

--Police shot dead the man suspected of driving the van that rammed into pedestrians in Barcelona last week, ending a five-day manhunt.  When I wrote of the terror attack last week, it was thought Younes Abouyaaqoub was one of those killed in a shootout in Cambrils, outside Barcelona.  Then we learned he was still on the loose.

Catalan police said the full terror cell consisted of 12 people, with six now killed by police.  Four were captured, and two others are believed to have died in the explosion at their bomb factory, where we’ve learned they were preparing to carry out a much larger attack

Turning to Asia....

Just a few economic notes from Japan, with its flash reading on manufacturing in August at 52.8 vs. 52.1 in July, while the country’s core consumer price index, which strips out fresh food, for July rose to 0.5% annualized from June’s 0.4%, according to the government.  Believe it or not, this marks the highest level since March 2015, while the Bank of Japan continues to sit with its 2% target.  Ergo, there will be no change in monetary policy for a long time at the Bank of Japan.  It cut its inflation forecast for the year to March 2018 to 1.4% back in July. Even this sounds ambitious.

[Headline CPI was 0.4%, the same as in the prior three months.  The yield on the Japanese 10-yr. bond ticked down Friday to 0.00%.]

Street Bytes

--Stocks rose after a two-week losing streak, with the Dow Jones up 0.6% to 21813, the S&P 500 up 0.7%, and Nasdaq 0.8%.  But it was a painfully slow week in terms of market action and next week, baring a geopolitical or D.C. surprise, promises more of the same, it being a heavy end of summer vacation week for the Street’s traders. 

--U.S. Treasury Yields

6-mo. 1.11%  2-yr. 1.33%  10-yr. 2.17%  30-yr. 2.75%

--As Hurricane Harvey hits tonight, it has the high potential to negatively affect five southern Texas coast refineries. As for the impact on gasoline prices, spikes at the pump could occur, but they wouldn’t last long.  At least that is my guess now.

The biggest impact will be on crude imports into Houston, Texas City and Baytown.

--Chevron Corp. CEO John Watson is planning on stepping down next month, according to people familiar with the matter, with Watson’s successor not yet finalized by the board. Watson would stay for a smooth transition.

These days at Big Oil, it’s all about squeezing costs, and shorter-term investments that turn a quick profit, rather than the giant, multi-decade projects of days gone by.

--Danish container shipping giant A.P. Moller-Maersk said it had agreed to sell its oil and gas business to the French energy giant Total for $4.95 billion, with Total’s CEO saying the company would take advantage of the low-cost environment to start new projects and seek acquisitions, while Maersk said it would focus on its shipping business.

Total’s overall production will increase by 160,000 barrels a day in 2018 through the deal, and it will become one of the largest operators of offshore rigs in northwest Europe.

--In a significant move, Walmart announced it would be partnering with Google and its Google Assistant to allow customers to place orders through the smart device and have them delivered by Google Express, an attempt to leverage Walmart’s brick-and-mortar empire in its battle with Amazon for the future of commerce.

Walmart is looking for ways to utilize its nearly 5,000 retail outlets double as distribution points for online sales.

Walmart.com’s new chief, Marc Lore, wrote in a blog post on Wednesday, that the partnership will allow Walmart to make use of its “4,700 U.S. stores and our fulfillment network to create customer experiences that don’t currently exist within voice shopping anywhere.”

Many remain skeptical of Walmart’s dreams in this respect, but I’d be optimistic Walmart can make real inroads against Amazon....

--....Speaking of which, Amazon announced it plans to shake up Whole Foods Market, by lowering prices on bananas, butter, organic avocados, rotisserie chickens and other items.  The acquisition of Whole Foods will close on Monday, and Amazon said it would waste no time making changes at more than 460 Whole Foods stores in the U.S., Canada and Britain.

Amazon seems determined to change the chain’s reputation as “Whole Paycheck,” as it lowers prices on a “selection of best-selling staples across its stores, with much more to come.”

Needless to say, shares in grocery and wholesale chains fell on the news.  Lower prices at Whole Foods means they will have to lower their own to compete, and that means lower margins.  This is big. Good for you and me, though.

--Uber Technologies Inc. reported a $645 million loss for the second quarter, narrowing from $708 million in the first quarter.  Revenue, not including a one-time outlay for New York drivers the company had mistakenly underpaid, rose 17% to $1.75 billion compared with the prior quarter and more than double the year ago period.

Uber’s booked $8.7 billion in the second quarter, also double  Q2 2016.

The company has $6.6 billion in cash, down from about $7.2bn as of the end of March.  Softbank Group Corp. may add to the cash if its proposed investment of at least $1bn goes through (perhaps buying part of Benchmark Capital’s stake).

But the results come as the CEO search to replace Travis Kalanick continues, while early Uber investor Benchmark is suing him for the return of three board seats it says he agreed to relinquish.

Separately, four mutual funds have written down the value of their Uber holdings by as much as 15% as of June 30 as some investors question the sky-high valuation.  The company is currently valued at about $68 billion.

As for the CEO search, which the company wants to wrap up soon, General Electric Chairman Jeff Immelt is seen to be the current front-runner, at least last I saw, not that I really give a damn.

--McDonald’s announced it would be serving up more antibiotic-free meat at its restaurants around the world, a big move since McDonald’s is the biggest purchaser of beef in the country and one of the largest buyers of pork.

Phasing out of the use of antibiotics is critical, medical experts say, because of the growing resistance to the drugs and fear of large-scale public health issues.

On large industrial farms, antibiotics are often used in animal feed.

Matthew Wellington, antibiotics program director for U.S. Public Interest Research Group: “The misuse of antibiotics and the rise of resistant bacteria is a worldwide health problem, not just a problem.  We’re glad that McDonald’s is working to preserve the effectiveness of these lifesaving medicines globally, and hope the chain moves quickly to make that vision a reality.”

According to the Centers for Disease Control and Prevention, at least 2 million Americans become sick and 23,000 die every year from antibiotic-resistant infections.  [Samantha Bomkamp / Chicago Tribune]

Separately, McDonald’s is severing ties with its second-largest franchisee in India, which could result in the loss of 170 outlets, forcing the chain to start over.  Connaught Plaza Restaurants Pvt. Ltd., which had a 22-year-old relationship with McDonald’s and operated in the north and east of the country, apparently wasn’t paying royalties and had violated other “essential obligations” of its contract with the latter.

The franchisee for the west and south of India is not impacted.

--Lowe’s reported earnings that missed estimates and warned of slower growth in profit margins as it spends more on marketing and staffing to take advantage of a robust home improvement market.  Lowe’s shares fell sharply on the news even as the No. 2 U.S. retailer in its sector (behind Home Depot) said demand for lumber, appliances and other products has soared  as homeowners increasingly prefer to remodel rather than buy a new home.

Lowe’s said it would increase staffing during weekends and other high-volume periods to improve the customer experience, CNBC’s Jim Cramer slamming the company the other day for its long lines.

Lowe’s net income rose 21.4 percent to $1.42 billion, with net sales climbing 6.8 percent to $19.50 billion, both of which lagged the Street’s forecasts.

Same-store sales did rise a solid 4.5 percent, which still trailed Home Depot.

--A South Korean court on Friday convicted Lee Jae-yong, the heir to the Samsung business empire, of bribery and embezzlement and sentenced him to five years in prison, a big decision in that in past cases involving major business figures, the penalties have been light.  Lee also may yet get pardoned, but it’s a strong message to the nation’s big, family controlled businesses (chaebols) and their dominance in one of the world’s most successful economies.

The court ruled that Mr. Lee and four other Samsung executives paid $6.4 million in bribes to the country’s disgraced former president, Park Geun-hye, to ensure Lee’s grip on Samsung Electronics was strengthened.

--According to the 2017 Forbes 100 Richest in Tech list, Bill Gates remains the richest in the world at $84.5bn, slightly ahead of Jeff Bezos, $81.7bn.  Mark Zuckerberg is third with $69.6bn.

The total worth of the world’s 100 richest tech billionaires has surpassed $1tn for the first time, according to Forbes, a rise of 21% in just 12 months.

Of the top 100, 50 are U.S. citizens and 33 are from Asia, half of the latter living in China or Hong Kong.

--And the converse of billionaires are us Dollar Tree shoppers.  The other day, I had to bring a food dish to a picnic and I knew I didn’t have an appropriate bowl to put it in, and also knew I’d be leaving early and wasn’t sticking around to bring back my bowl, but I could get a cheap bowl at Dollar Tree for...a buck and just leave it! 

Anyway, Dollar Tree reported terrific earnings on Thursday of $233.8 million, above the Street’s expectations, on revenues of $5.28 billion, with same-store sales of 3.9%...its Family Dollar subsidiary’s comp sales rose 1.0%.

--Research firm eMarketer’s latest forecast has Snapchat overtaking both Instagram and Facebook in terms of total users aged between 12 and 24 for the first time this year.  Both Snapchat and Instagram continue to attract younger users, drawing some of them away from Facebook; young teens having the attention span of a gnat...not to give gnats a bad name.

--Business at Tiffany’s flagship Fifth Avenue store – located next to Trump Tower – has returned to normal after months of disruptions from police barricades.

Overall company comparable sales were off 2 percent from last year in its recent quarter and off 1 percent in the Americas, much better than the prior quarter.

--Sears Holdings Corp. said Thursday it would close an additional 28 Kmart stores nationwide.  Already this year, Sears has closed 180 stores, including from its Kmart chain, and an additional 150 are to close down by the end of next quarter.

Sears reported its second-quarter loss was $251 million, as revenue fell 23% to $4.37 billion, owing to all the store closures. Same-store sales cratered 11.5%; down 9.4% at Kmart, and off 13.2% at Sears locations open at least a year.

--In a good sign for the economy, American ports took in a near-record number of shipments in July, according to preliminary data from the National Retail Federation, as retailers and manufacturers begin to stock up for the peak shopping season.  Shipments of auto parts, furniture and back-to-school related goods were among the strongest categories of growth, as reported by Panjiva, a trade data service. 

Imports surged 15% in July at the ports of Los Angeles and Long Beach, Calif., for one, while the Port of Savannah, Ga., the second largest East Coast port, reported its busiest July ever.  [Erica F. Phillips / Wall Street Journal]

--A Los Angeles jury issued a $417-million verdict Monday against Johnson & Johnson, finding the company liable for failing to warn a 63-year-old woman diagnosed with terminal ovarian cancer about the risks of using its talcum products.

More than 300 similar lawsuits are pending in California and more than 4,500 claims in the rest of the country, alleging J&J ignored studies linking its Baby Powder and Shower to Shower products to cancer.

Johnson & Johnson said it would seek to overturn the verdict; the company citing various scientific studies, as well as federal agencies, including the FDA, that have not found talc products are carcinogenic.

--As many as 9 people were killed, with many missing, as Typhoon Hato barreled into Macau, wiping out power and water in large pockets of the world’s biggest gambling hub.  Hato was the strongest storm to hit the area since 1968, inflicting significant damage on Hong Kong as well, which shut down its financial markets, a rare move.

Having been to Macau a couple times, I can only imagine the damage as 124 mph winds and torrential rain did a number on the infrastructure, including the water pumps.  You just have to picture the tens of thousands of tourists that are there every day.   I would take a high-speed ferry from Hong Kong, which runs non-stop (very comfortable 50-minute ride), and as the storm wasn’t forecast to hit with the strength it did, I can only imagine how many tourists were then stranded in hotels now without power and water.  The video from there is frightening.

A Wynn Hotel Macau staff member told the South China Morning Post that they are encouraging their guests to stay and “stay safe.”  Guests aren’t being rushed out, and new arrivals are not being accepted.

--The U.S. State Department has warned citizens about traveling to Cancun and Los Cabos, after a surge in violence in those regions; predominantly turf battles between drug gangs that have resulted in shootings where innocent bystanders have been killed.

For years, both areas were largely insulated from the drug war violence, but this year they have witnessed a major uptick in killings.

In Los Cabos, which includes the cities of Cabo San Lucas and San Jose del Cabo, three people were shot to death this month at the entrance to a popular beach.  [Kate Linthicum / Los Angeles Times]

Tourism is a $20 billion a year industry in Mexico and these travel warnings could be a huge blow.

--Speaking of tourism, according to the International Monetary Fund, tourism to Iceland this year will amount to 2.2 million visitors, almost five times as many as in 2010, which is incredible.  I’ve been here twice, the last time in 2009.

Tourism is now Iceland’s biggest industry, surpassing its traditional lifeline, fishing.

But these numbers have left the government unprepared in terms of infrastructure.  Because the hotels are packed, and it takes time to build new ones, the government has pushed Airbnb, which has helped lead to a surge in home prices, up 18.3% in the year through March, according to Knight Frank.

Actually, it sounds like a nightmare, with downtown Reykjavik packed.  I’m glad I went when I did, which was after the 2008 financial collapse there.  It has more than recovered. The economy grew 7.2% last year.

--A favorite tweet, courtesy of the New York Times: “I feel like a lot of people don’t understand this, but money, fame, love – none of it matters if you don’t have a good social media strategy.”  [Existential Comics]

--I saw the following headline on the wires: “Arby’s Announces Senior Leadership Changes.”

I want to be Senior Vice President, Bacon Sides.

Speaking of which, Johnny Mac just informed me that Asheville, N.C., has its “BaconFest” at Highland Brewing, Sat., 1 p.m. until 4 p.m.  So if you’re in the area, catch it.  I’m jealous.

Foreign Affairs

North Korea: With photographs showing a new rocket design, North Korea is sending a message it continues to work on improving its intercontinental ballistic missile technology; specifically, a more powerful one than previously tested, according to weapons experts. If perfected, Pyongyang could hit any target on the U.S. mainland, including Washington and New York.

The photographs released by state media on Wednesday showed Kim Jong Un standing next to a three-stage rocket it called the Hwasong-13.  The photos were accompanied by a report of Kim issuing instructions for the production of more rocket engines and warheads.

Some believe it was a mistake for the photos to be aired. Certainly it was an intelligence ‘find’ for the U.S. and South Korea.

But reports from the KCNA news agency this week largely lacked the traditional robust threats against the U.S., save for Sunday’s threat to unleash a missile attack. 

That said, Pyongyang has been pretty quiet, especially considering the U.S.-South Korean war games have been taking place.

On Tuesday, President Trump said in Phoenix, “I respect the fact that I believe [Kim Jong Un] is starting to respect us.  Maybe, probably not, something positive will come out of it.”

Sec. of State Tillerson told reporters: “I am pleased to see that the regime in Pyongyang has certainly demonstrated some level of restraint that we have not seen in the past. Perhaps we are seeing our pathway to sometime in the near future having some dialogue.”

Probably not.  Kim is just going about his thing, ramping up his missile program.

Separately, Israel’s Haaretz newspaper reported on a confidential United Nations review on North Korea sanctions violations. “Two North Korean shipments to a Syrian government agency responsible for the country’s chemical weapons program were intercepted in the past six months.” 

The U.N. is also investigating cooperation between North Korea and Syria on the latter’s Scud missile programs and maintenance and repair of Syrian surface-to-air missile defense systems.

For its part, the U.S. imposed sanctions on sixteen companies and individuals accused of helping Pyongyang develop missiles and nuclear weapons (10 companies, six individuals) primarily from China and Russia, as announced by Treasury Secretary Mnuchin.

Friday night, Kim fired three short-range missiles into the sea from its eastern coast, though it appears all three were failures. Nonetheless, these were the first missiles since the successful July 28 ICBM test.

Iraq/Syria/Iran:

The United Nations called for a humanitarian pause in the fighting in the Syrian city of Raqqa, urging the U.S.-led coalition to rein in air strikes that have caused significant casualties.

But Friday, the Syrian Observatory for Human Rights said at least 34 Syrian soldiers and allied fighters were killed in an ISIS counterattack east of Raqqa. The Observatory said IS “made major progress and...expanded the area under its control along the southern bank of the Euphrates,” which isn’t the way this is supposed to happen.

Monday, Russia’s air force claimed it killed over 200 ISIS fighters on their way to the Syrian city of Deir al-Zor, according to Russian news agencies, as ISIS concentrates its forces around the city after being forced out of the south of Raqqa.

The Syrian army operation in the area, backed by Russia, is different from the fight for Raqqa itself.  There, the Syrian Democratic Forces, SDF, a U.S.-backed alliance of Kurdish and Arab fighters, has captured less than 60% of Raqqa city since it entered in June after months fighting to encircle it beforehand.  [Agence France Presse]

Israel: President Trump remains committed and optimistic about achieving peace between Israel and the Palestinians, as passed on by senior adviser Jared Kushner in the region this week.  But there is zero real progress thus far, Kushner meeting separately with Israeli Prime Minister Netanyahu and Palestinian President Abbas.  Palestinians are still seeking a pledge of support from the administration for the creation of a Palestinian state alongside Israel – which has been the foundation of U.S. Middle East policy for over two decades.

For his part, Netanyahu faces pressure from his right-wing coalition partners not to give ground on Jewish settlement building in occupied territory that Palestinians seek for an independent state.

Lebanon: Hizbullah leader Sayyed Hassan Nasrallah said on Thursday that his forces had captured much of an ISIS enclave on Syria’s side of the Lebanese border, in a joint offensive with the Syrian army.  Talks on a truce deal have begun with Islamic State, but Nasrallah said he’s looking for a military victory.

Egypt: President Trump called Egyptian President Sisi on Friday, telling him the U.S. wants to strengthen ties with Cairo, even as Washington cut some aid to Egypt this week over human rights concerns.  Wednesday, Jared Kushner met with Sisi, as Egypt issued a statement saying the cut in aid reflected “poor judgment on the strategic relationship that ties the two countries over long decades.”

But Egyptian rights activists have said they face the worst crackdown in their history under Sisi, accusing him of taking back the freedoms won in the 2011 Arab Spring uprising that ended Hosni Mubarak’s 30-year rule. The Egyptian government says the rights groups are taking foreign funds to sow chaos.

China: After President Trump’s remarks on Pakistan’s lack of cooperation regarding Afghanistan, China defended its ally, with Foreign Ministry spokeswoman Hua Chunying saying Pakistan was on the front line in the struggle against terrorism and had made “great sacrifices” and “important contributions” in the fight.

Meanwhile, China’s crackdown on the press continues, though some are fighting back.

Editorial / Washington Post

“The Cambridge University Press has rightly abandoned its plan to censor the prestigious China Quarterly journal at the behest of the Chinese authorities. It was indefensible for the journal to remove some 300 sensitive articles and book reviews from its website for a Chinese audience, and it realized the error quickly. But the Chinese request will probably not be the last.

“The state-run Global Times newspaper asserted that ‘Western institutions have the freedom to choose’ whether they want to do business in China.  ‘If they don’t like the Chinese way, they can stop engaging with us. If they think China’s Internet market is so important that they can’t miss out, they need to respect Chinese law and adapt to the Chinese way.’  This will sound familiar to U.S. companies that have been instructed that they must obey Chinese cybersecurity laws that could be used for repression, under threat of criminal penalty, and have complied.  Cambridge also acted with an eye on the market; the press has enjoyed double-digit year-on-year growth in China for the past five years, and its most popular title, an English-language course book, sold more than 3 million copies over the past years, according to the Financial Times.

“For years, an argument has been made that engagement with China would change it, that contact with the West would influence China toward openness, rule of law and democracy. We have often agreed with this notion, and we still think engagement beats isolation. But the presidency of Xi Jinping is making it harder to defend this proposition. China is actively resisting Western influences and pushing back on digital battlefields. The ‘China way’ means that a paternalistic state, run by a party with a monopoly on power, will decide what people can know and what they can say.”

In line with the above, in Hong Kong on Sunday, tens of thousands took to the streets to protest against the jailing of three young democracy activists.  The three, ages 20 to 27, were jailed for six to eight months for unlawful assembly, dealing a blow to the youth-led push for universal suffrage and prompting accusations of political interference from Beijing.

With the jailing of the three, that meant in the legislative council the opposition would now lack the votes to filibuster legislation.

Editorial / Wall Street Journal

“Hong Kong now has its first political prisoners, and if Beijing has its way they will be followed by many more. That will force the city’s residents into a stark choice of whether to continue fighting for the rights China promised when it guaranteed 50 years of Hong Kong autonomy or accept that the former British colony’s special status is fading into history.”

Russia: Foreign Minister Sergei Lavrov, responding to the U.S. Embassy’s announcement on Monday that it would implement a visa stop for Russian citizens, said: “We’re not going to take out our anger on American citizens.  So if someone hoped that this stupid example would be contagious, they miscalculated.”

The U.S. Embassy said it would temporarily stop processing non-immigrant visa applications starting Aug. 23, though operations in Moscow would resume in September, while other consulates would “remain suspended indefinitely.”

This is in response to the forced reduction in Embassy staff by the Kremlin.

Lavrov said the U.S. was fomenting unrest in Russia.

Ukraine: Defense Secretary Jim Mattis, on a trip to Ukraine this week, said Washington would pressure Russia over its aggressive behavior and signaled his personal support for supplying Kiev with weapons.  Mattis said Russia had not abided by the Minsk ceasefire agreement meant to end the separatist conflict in eastern Ukraine.

U.S. Secretary of State Rex Tillerson was in Kiev in July, so we are doing a good job of showing our support.

But we still haven’t given Ukraine the defensive weapons it has requested since the start of the war and this ticks me off to no end.  Mattis can only do so much as it’s up to Trump.  Mattis knows the U.S. should be helping Ukraine in a much bigger way than night-vision goggles.  Both Presidents Obama and Trump are/have been total idiots in this regard.

Mattis said, correctly, “Defensive weapons are not provocative unless you are an aggressor and clearly Ukraine is not an aggressor since it is their own territory where the fighting is happening.”

Canada: The country fears a huge surge in asylum seekers crossing the border from the United States, which is putting pressure on Prime Minister Justin Trudeau. The number of migrants illegally entering Canada more than tripled in July and August, hitting nearly 7,000.  Haitians, who face deportation in the U.S. when their temporary status expires in January 2018, account for much of the inflow.  Citizens from El Salvador, Nicaragua and Honduras are also slated to lose legal protection in early 2018, so they’ll no doubt be heading north in increasing numbers.

With most of the migrants flooding into predominantly French-speaking Quebec, there are a rising number of protests from opposition politicians and anti-immigrant groups.

For his part, Trudeau tweeted Canada’s welcome of refugees after President Trump unveiled a travel ban in January, and now he is regretting this.

A Reuters poll in March found nearly half of Canadians want to deport people who are illegally crossing from the U.S., so one imagines the opposition number has skyrocketed since then.

Ottawa is warning those crossing over they could be deported.

In a speech Wednesday, Trudeau said “Canada is an opening and welcoming society, but let me be clear.  We are also a country of laws....There are rigorous immigration and custom rules that will be followed.  Make no mistake.”

Most of those crossing are placed in rapidly growing refugee camps.

[Watch the hard-core Quebec nationalists (the Quebecois).  There will be violence.]

Cuba: Editorial / Washington Post

“President Barack Obama’s much-hyped restoration of relations with Cuba was a bet that diplomatic and economic engagement would, over time, accomplish what 50 years of boycott did not: a rebirth of political freedom on the island. So far, the results have been dismal. In the two years since the U.S. Embassy in Havana reopened, repression of Cubans – measured in detentions, beatings and political prisoners – has significantly increased, while the private sector has remained stagnant.  U.S. exports to Cuba have actually decreased, even as the cash-starved regime of Raul Castro pockets millions of dollars paid by Americans in visa fees and charges at state-run hotels.

“Now there’s another sinister cost to tally – the serious injuries inflicted on the U.S. diplomats dispatched to Havana.  This month, the State Department announced that two Cuban embassy staff had been expelled from Washington because of ‘incidents’ in Havana that left some American diplomats and staff members with ‘a variety of physical symptoms.’ Anonymous sources speaking to various news organizations have since provided shocking details: At least 16 American diplomats and family members received medical treatment resulting from sonic attacks directed at the residences where they were required to live by the Cuban government. A number of Canadian diplomats were also affected.

“CBS News reported that a doctor who evaluated the American and Canadian victims found conditions including mild traumatic brain injury, ‘with likely damage to the central nervous system.’  According to CNN, two Americans evacuated to the United States were unable to return to Havana, while others cut short their tours of duty.

“The State Department is saying that it has not identified the source of the attacks, though it is holding the Cuban government responsible under the Vienna Convention, which requires host governments to protect diplomatic personnel. Some news reports have passed along speculation that rogue Cuban security forces might be to blame, or perhaps a third country interested in disrupting Cuba’s rapprochement with the United States.  Such theories must be weighed against facts there: Cuba is a small, highly disciplined police state where next to nothing goes unobserved by the regime – much less high-tech assaults on foreign diplomats.”

Venezuela: Friday, the White House slapped further financial sanctions on this hell-hole, ratcheting up tensions and making it harder for President Nicolas Maduro to raise badly needed funds to prevent a debt default.

The sanctions prohibit financial institutions from providing new money to the government or state oil company PDVSA.  I’m not sure exactly how this will work, so more next time as warranted.  For now, you don’t want to further hurt the impoverished, starving people there.

But this is clearly a move against Maduro’s creation of the fake constitutional assembly that is made up entirely of government loyalists.

I keep repeating, take Maduro out.  Drop him from a helicopter into the sea and let the sharks rip this idiot to shreds.

Random Musings

--Presidential tracking polls....

Gallup: 34% approval for President Trump, 60% disapproval
Rasmussen:  42% approval, 56% disapproval

In a new Quinnipiac University Poll, Trump’s job approval is 35%, 59% disapproving, down from a 39-57 split in its prior survey.  [Since the beginning of his presidency, for the Quinnipiac poll, Trump’s approval rating has ranged from 42%, Feb. 7, to 33%, Aug. 2.]

Republicans approve of Trump 77-14; white voters with no college, 52-40, and white men approve by 50-46.

American voters disapprove 60-32 percent with Trump’s response to the events in Charlottesville.  59% say Trump’s decisions and behavior have encouraged white supremacist groups.

Since Trump’s election, “the level of hatred and prejudice in the U.S. has increased,” 65% of voters say, while 2% say it has decreased and 32% say it hasn’t changed.

“One word – Charlottesville. Elected on his strength as a deal-maker, but now overwhelmingly considered a divider, President Donald Trump has a big negative job approval rating and low scores on handling racial issues,” said Tim Malloy, assistant director of the Quinnipiac University Poll.

On the issue of removing Confederate statues from public spaces, voters oppose removal by a 50-39 margin.  White voters oppose removal 57-33, with black voters supporting removal 67-21.

White supremacist groups pose a threat to the U.S., 64-34, according to voters.

By a 61-36 margin, voters do not believe President Trump is honest.  68% do not believe he is level headed, 29% do.

Voters also disapprove 55-40 of the way the news media covers Trump, and disapprove 62-35 of the way the president talks about the media.

In a new Washington Post-ABC News poll, Trump has an overall approval rating of 37%, compared with 36% in July.

Regarding his handling of the Charlottesville protests, more than 6 in 10 Republicans approve of the president’s response, with an overall approval rating of 80% among the elephants, though the number that approves “strongly” – just about half of the GOP – is down 10 percentage points from last month, and this was before Tuesday’s performance in Phoenix.

The Post-ABC survey found that roughly 1 in 6 Americans either support the alt-right or say it is acceptable to hold white supremacist or neo-Nazi views.  This subgroup approves of Trump’s overall job performance by a 54-43 margin.

Political independents disapprove of Trump’s response to Charlottesville 55% to 28%.  84% disapprove.

In a Marist College survey for NBC News, looking at the three states that put President Trump over the top last year, Pennsylvania, Michigan and Wisconsin, several numbers should be disturbing for the White House.

Among people who voted for him last year, 19% in Pennsylvania, 16% in Michigan, and 23% in Wisconsin now do not approve of his performance in office.

So this means among those who backed him, 81% approve in Pennsylvania, 84% in Michigan, and 77% in Wisconsin.

In terms of job approval, among all voters, 33% approve of how Trump is doing in Pennsylvania, 36% in Michigan, and 33% in Wisconsin. 

Of course this doesn’t mean Trump would lose these three in 2020, it’s too far away, but worth watching, especially with the 2018 results.

--Trump senior adviser Sebastian Gorka was fired as part of the news dump tonight.  Good riddance.

--The Hill’s Ben Kamsar and Lisa Hagen identify the seven most vulnerable Senate seats in 2018.

Sen. Dean Heller (R-Nev.), Sen. Claire McCaskill (D-Mo.), Sen. Joe Donnelly (D-Ind.), Sen. Jeff Flake (R-Ariz.), Sen. Joe Manchin (D-W.Va.), Sen. Heidi Heitkamp (D-N.D.), and Sen. Jon Tester (D-Mont.).

So for all the concern among Republicans, five of the seven are Democrats.

Flake wouldn’t ordinarily be on the list in a normal year, but Trump threatening to support a primary challenge doesn’t help.  In Manchin’s case, West Virginia went to Trump by 42 points, and you have Gov. Jim Justice recently switching to the Republican side.  Of course I, like a lot of folk, have been waiting for Manchin, who I like, to do the same.

Others who could be vulnerable are Democratic Sens. Bill Nelson (Fla.), Bob Casey Jr. (Pa.), Tammy Baldwin (Wis.), Debbie Stabenow (Mich.) and Sherrod Brown (Ohio), all by virtue of running in states Trump won, though The Hill says they aren’t as vulnerable as the others.

Kid Rock is still mulling a bid in Michigan against Stabenow, and according to the above-mentioned Marist survey, he has a 38% favorable rating in the state, with 32% having an unfavorable view.  30% say they have never heard of him or are unsure how to rate him.

--The Republican National Committee outraised the Democratic National Committee in July, $10.2 million to $3.8 million.  This is the lowest amount raised by the DNC in July since 2007. 

Through the first seven months of the year, the RNC had raised $86.5 million, while the DNC had raised about $42 million.  And the GOP has $47.1 million cash on hand to the donkey’s $6.9 million.  [The Hill]

--The U.S. Navy dismissed Vice Adm. Joseph Aucoin as commander of the Seventh Fleet after four collisions involving warships in Asia in the past year.

The latest tragedy occurred Monday, when the USS John S. McCain collided with an oil tanker near Singapore, with one dead, nine missing and presumed dead.

The Seventh Fleet, based in Yokosuka, Japan, is the largest forward-deployed fleet in the U.S. Navy, with some 50 to 70 vessels and submarines.  Aucoin was its commander since 2015 and was due to retire within weeks.

The collision, before dawn, left a large hole in the destroyer’s port side – the left-hand side of the vessel facing forward – and flooded compartments including crew berths.

Just two months ago, seven U.S. sailors were killed when the USS Fitzgerald collided with a container ship in Japanese waters. Those killed were also in flooded berths after the collision caused a gash under the warship’s waterline.

The Navy has launched a review that includes a “deliberate reset” for ships that focuses on navigation (the preliminary reading on the McCain is ‘steering malfunction’), maintaining mechanical systems and manning the ship’s bridge appropriately, this last one a major factor behind the collision of the USS Fitzgerald.

Talk of a possible cyberattack on some of the vessels involved in the accidents is just that at this stage.

--Another move by the White House late Friday...we learned President Trump signed the directive that precludes transgender individuals from joining the military, but it gives Defense Secretary Mattis wide discretion in determining whether transgender personnel currently in the armed forces can continue to serve.

Mattis has six months to develop a plan to implement Trump’s order. The directive also applies to the Dept. of Homeland Security and the Coast Guard.

--According to a USA TODAY report, the Secret Service is facing a strain on its budget due in part to President Trump’s large family and multiple properties, with Secret Service Director Randolph “Tex” Alles saying some 1,100 agents will soon hit their overtime allowance caps for the year.

Under Trump, 42 people receive protection, an increase from the 31 during the Obama administration.  The Secret Service said it has faced similar situations in recent years.

--Jon Meacham / New York Times...on the statuary debate; Meacham having grown up on Missionary Ridge, a Civil War battlefield overlooking Chattanooga, Tenn.

“In the ensuing chaos (from the Charlottesville violence), President Trump spoke of the ‘many sides’ of the debate and defended the neo-Confederate view.  ‘I wonder,’ Mr. Trump said, ‘is it George Washington next week, and is it Thomas Jefferson the week after?  You know, you really have to ask yourself, where does it stop?’

“To me, the answer to Mr. Trump’s question begins with a straightforward test: Was the person to whom a monument is erected on public property devoted to the American experiment in liberty and self-government?  Washington and Jefferson and Andrew Jackson were.  Each owned slaves; each was largely a creature of his time and place on matters of race.  Yet each also believed in the transcendent significance of the nation, and each was committed to the journey toward ‘a more perfect Union.’

“By definition, the Confederate hierarchy fails that test.  Those who took up arms against the Union were explicitly attempting to stop the American odyssey.  While we should judge each individual on the totality of their lives (defenders of Lee, for instance, point to his attempts to be a figure of reconciliation after the war), the forces of hate and of exclusion long ago made Confederate imagery their own.  Monuments in public places of veneration to those who believed it their duty to fight the Union have no place in the Union of the 21st century – a view with which Lee himself might have agreed.  ‘I think it wiser,’ he wrote in 1866, ‘not to keep open the sores of war.’

“Of course, Lee lost that struggle, too, and my home state is dealing with just this issue at the moment.  In 1973, the Sons of Confederate Veterans raised money to install a bust of Nathan Bedford Forrest, the Southern cavalry commander and early leader of the Klan, in the state capitol.”

I know a little something on Forrest, and I’ve driven through Pulaski, Tenn., on my way to Shiloh years ago, and I’ll leave it at that.  [If you don’t know the significance of Pulaski, that’s your homework assignment.]

Meacham:

“ ‘There will never be peace in Tennessee,’ Union Gen. William T. Sherman once said, ‘until Forrest is dead.’  Like his more celebrated remark that war is hell, Sherman was onto something. The good news in this grim period of 2017 is that reasonable Southerners may be ready to give peace a chance.”

[The same trip I went to Shiloh Battlefield, to do research on Gen. Lew Wallace, who had a defining moment there for the Union, which he then used in his book, “Ben-Hur,” I also made a pilgrimage to the home of Sheriff Buford Pusser.  What a fascinating, and tragic, figure he was.  He survived numerous assassination attempts, only to die in a high-speed car crash in his beloved Corvette, just as he was about to star as himself in the sequel to “Walking Tall,” a popular movie of its era based on his crime-fighting story.]

--So how many military bands are there?  Try 136!  I was shocked to read this in the current issue of Army Times. This number is under scrutiny by the Government of Accountability Office.  The GAO outlined in a report how the services have yet to “develop objectives and measures to assess how their bands are addressing the bands’ missions, such as inspiring patriotism and enhancing the morale of troops.”

There are about 6,500 uniformed personnel, at a cost of $260 million a year, that are serving as musicians, the GAO found. The Army has the most bands at 99; the Air Force 14; the Marine Corps 12 and the Navy 11.

Almost all military musicians are combat deployable, but most are deployed to provide music, not to fight.

Seems to me you could lop off at least $100 million, starting with some of the woodwinds, though you need a flute or two for most of Sousa’s marches.

--Louise Linton, the Scotland-born actress and wife of U.S. Treasury Secretary Steven Mnuchin, embarrassed herself and the White House some when she posted a photo of herself exiting a U.S. government aircraft after a flight from Kentucky. She was holding a Hermes Birkin handbag, a brand and model that sells for more than $10,000, and her post included hash tags of the designer clothes, shoes and sunglasses she was wearing.

Not exactly the image the administration wants to portray in terms of working for the little guy in America.

On social media, Linton responded to an Oregon woman who criticized her “little getaway,” writing, “I’m pretty sure we paid more taxes toward our day trip than you did.” And then Linton said she’s “pretty sure the amount we sacrifice per year is a lot more than you’d be willing to sacrifice if the choice was yours,” adding, “you’re adorably out of touch.”  That, friends, is a jerk.

--The Palm Beach Zoo and Conservation Society has joined a growing list of charities and organizations in canceling events at President Trump’s Mar-a-Lago resort following his post-Charlottesville comments.

It seems the zoo’s elephants aren’t happy, and when you are the titular head of the Republican Party, if you lose the pachyderms, you’re toast.

--Wired magazine had a fascinating interview with astronaut Scott Kelly, whose last mission was 340 days on the International Space Station (ISS).  Among the questions....

WIRED: What did you miss most during your year on the ISS?

KELLY: Toward the end, I noticed little things were bothering me.  Like sitting at a table and having to keep track of my spoon. But mostly what you miss is people.  Friends and family. And weather. Even just the wind, rain, sun, going outside.

WIRED: You probably had a lot of time to watch TV, though.

KELLY: We watched Gravity in space, which was a pretty funny thing to do – like watching a movie of your house burning down while you’re inside of it. Watched The Martian.  But really more CNN than anything else. That and football.

Kelly has written a book on his long career as an astronaut, Endurance, which sounds terrific.

--In the Aug. 28 issue of TIME, there was the following blurb:

“A 106-year-old fruitcake was discovered in a hut on Cape Adare, Antarctica, that was used by British explorer Robert Falcon Scott during his final, fateful 1911 expedition. The Antarctic Heritage Trust said the cake was in ‘excellent condition.’”

Yes, the legend of the fruitcake lives on.

--Time for your editor to get in trouble with a very sexist statement...at least some may see it that way.

I’ve been to Lebanon twice and have written the women there are among the most beautiful in the world.  [I also said that of Slovenians, long before I knew of Melania’s heritage.]

So I have to make note of the news that a recent winner of the Miss Lebanon pageant, the drop-dead gorgeous Amanda Hanna, had her title removed after one week when it was revealed she had an academic trip to Israel in 2016.  To go to Israel, as a Lebanese, is illegal because Lebanon remains in a state of war with Israel, the most recent conflict being in 2006.

Ms. Hanna stayed positive and wrote on Facebook: “It has been one of the best weeks of my life, where I have, among other things, had to go around in Lebanon & visit wonderful places... I am incredibly happy that I participated.”

You go, girl!

It was in 2015 that the then-Miss Lebanon, Sally Greige, was told her status would be removed as the Lebanese contestant in the Miss Universe pageant after a selfie of her including Miss Israel was posted on Instagram.  Greige claimed that posing with Miss Israel was unintentional and was able to maintain her title.

So I went to Lebanon in 2005, weeks after the assassination of Rafik Hariri, and returned in 2010, and I haven’t been to Israel, which is on my bucket list.  But I guarantee you I’d be questioned extensively at either Newark Airport or Ben Gurion if I ever went.  It’s just the way these things work.  Lebanon and Israel will be at war again, a serious one, within three years, and it will be because of Iran.

--Iconic civil rights activist and comedian Dick Gregory died last weekend at the age of 84.

Gregory broke racial barriers in the 1960s as one of the first black standup comics to connect with white audiences (but not me, I hasten to add...I was a Richard Pryor man myself, among those of that ilk).

One of Gregory’s more famous comments, though, is indeed pretty funny:

“Where else in the world but America could I have lived in the worst neighborhoods, attended the worst schools, rode in the back of the bus, and get paid $5,000 a week just for talking about it?”

In later years, Gregory preached the virtues of prayer, non-violence, vegetarianism and raw food diets.

--Writing in The Atlantic, Peter Beinart made the following comment about Antifa:

“Antifa believes it is pursuing the opposite of authoritarianism.  Many of its activists oppose the very notion of a centralized state.  But in the name of protecting the vulnerable, anti-fascists have granted themselves the authority to decide which Americans may publicly assemble and which may not. That authority rests on no democratic foundation.  Unlike the politicians they revile, the men and women of antifa cannot be voted out of office. Generally, they don’t even disclose their names....

“Revulsion, fear, and rage are understandable.  But one thing is clear. The people preventing Republicans from safely assembling on the streets of Portland [Ed. Portland, OR, has a huge, ongoing problem with anarchists] may consider themselves fierce opponents of the authoritarianism growing on the American right.  In truth, however, they are its unlikeliest allies.”

--The World War II heavy cruiser USS Indianapolis was found in the Pacific Ocean, 72 years after its sinking by a Japanese submarine.

The Indianapolis was destroyed returning from its secret mission to deliver parts for the atomic bomb that was later used on Hiroshima.

It was discovered 18,000 feet beneath the surface in the Philippine Sea; Microsoft co-founder Paul Allen leading the civilian search team.  Allen said the discovery was “truly humbling.”

I imagine there are many younger folk who don’t know the story of the Indianapolis, of how 1,196 men were on board, and when the survivors were finally discovered in the water, four days later, just 316 were still alive.

There was no distress call because of the mission, carrying parts for the atomic bomb nicknamed “Little Boy” as well as enriched uranium fuel for its nuclear reaction.  Those supplies were delivered to Tinian Island*, an American base from which was launched the world’s first nuclear bombing.

Four days later, though, the Indianapolis sank – less than a week before the nuclear bomb it helped to make destroyed Hiroshima.

The exact location of the discovery is to remain a secret forever as it is a grave site.  Allen turned over the details to the U.S. Navy.  [But I do know it was somewhat close to my beloved island of Yap, in relative terms, probably the closest major island to it, that or Palau.  That’s my guess.]

*In keeping with my recent Guam lessons, when you take the quick flight from Guam to Saipan, as I did one year, you fly over Tinian, only I was kicking myself years later for not remembering as I looked down on it that it was the island from where the Enola Gay took off.

The sinking of the Indianapolis is featured in the movie “Jaws;” Quint, Brody and Hooper on their boat, hunting for the shark, when Brody points to one of Quint’s scars.

Brody:  What’s that one?...That one, there, on your arm.

Quint: Oh, uh, that’s a tattoo, I got that removed.

Hooper asks: What is it?

Quint: Mr. Hooper, that’s the USS Indianapolis.

Hooper: You were on the Indianapolis?  [Hooper knowing the history, Brody not knowing.]

Brody: What happened?

Quint then tells him, the full, gruesome tale.

You all can look up the clip on YouTube, but I read the script yesterday and it is very factual.  Out of respect to those who died on the Indianapolis, I won’t retell it here. 

Let’s just say, as I close every week, we keep them forever in our thoughts.

And Paul Allen deserves a special award for his patriotism.

---

Pray for the men and women of our armed forces...and all the fallen, including the victims of the USS John McCain.

Remember the Indianapolis.

God bless America.

---

Gold $1296
Oil $47.86

Returns for the week 8/28-9/1

Dow Jones +0.6%  [21813]
S&P 500  +0.7%  [2443]
S&P MidCap  +0.9%  [1708]
Russell 2000  +1.5%  [1377]
Nasdaq  +0.8%  [6265]

Returns for the period 1/1/17-9/1/17

Dow Jones  +10.4%
S&P 500  +9.1%
S&P MidCap  +2.9%
Russell 2000  +1.5%
Nasdaq   +16.4%

Bulls  48.1
Bears  18.3  [Source: Investors Intelligence]

Have a great week.  Prayers for Texas and Louisiana.

Brian Trumbore