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05/13/2017

For the week 5/8-5/12

[Posted 5:00 a.m. ET, Saturday, from somewhere on the Jersey Shore....]

Note: StocksandNews has significant ongoing costs and your support is greatly appreciated.  Click on the gofundme link or send a check to PO Box 990, New Providence, NJ 07974.  *Special thanks to long-time friend Brad K.

Edition 944

Trump World....the Comey firing and the blowback....

Due to the fact I have basically been out of touch since early Friday afternoon, it’s impossible for me to tie everything together as I normally attempt to do given another hectic Friday in Trump World. 

---

Monday, former Acting Attorney General Sally Yates, appearing before a Senate Judiciary subcommittee, recounted in detail her unusual visit in January to White House Counsel Donald McGahn, warning him that the Justice Department had evidence former National Security Adviser Michael Flynn had lied to White House officials and the public about certain “problematic” conduct, though in a Senate hearing, she declined to specify the conduct, though from leaks it seems to involve Flynn discussing sanctions on Russia with the Russian ambassador.

We also learned Monday that President Obama had warned Trump not to hire Mr. Flynn.

Separately, both Ms. Yates and former Director of National Intelligence James Clapper admitted that while in office they had personally reviewed classified reports about “Mr. Trump, his officials or members of Congress” who had been “unmasked.”

Editorial / Wall Street Journal

“We thought readers might like to know those details in case they go unreported anywhere else in the press.  The unmasking of the names of political opponents is a serious concern, and the American people need to know how and why that happened here.”

Late Tuesday afternoon, President Trump stunned the nation in firing FBI Director James Comey, with the case against the Director of Intelligence, now laid out in a letter by Deputy Attorney General Rod Rosenstein, who said he “cannot defend” how Comey had treated Hillary Clinton during the investigation into her emails.

President Trump then had the following letter delivered to the FBI....

Dear Director Comey:

“I have received the attached letters from the Attorney General and Deputy Attorney General of the United States recommending your dismissal as the Director of the Federal Bureau of Investigation.  I have accepted their recommendation and you are hereby terminated and removed from office, effective immediately.

“While I greatly appreciate you informing me, on three separate occasions, that I am not under investigation, I nevertheless concur with the judgment of the Department of Justice that you are not able to effectively lead the Bureau.

“It is essential that we find new leadership for the FBI that restores public trust and confidence in its vital law enforcement mission.”

Immediately, Democrats had a field day, with Senate Minority Leader Charles Schumer (N.Y.) saying at a news conference, “Are people going to suspect cover-up? Absolutely.”

Other Democratic senators described Trump’s move as “Nixonian” and there were renewed calls for a special prosecutor.

CNN legal analyst Jeffrey Toobin described Trump’s decision as a “grotesque abuse of power.”

Just one week earlier, Trump had tweeted: “FBI Director Comey was the best thing that ever happened to Hillary Clinton in that he gave her a free pass for many bad deeds!”

Among the comments from GOP senators:

Sen. Richard Burr (N.C.): In a statement he said that he was “troubled by the timing and reasoning of Director Comey’s termination.”

Sen. Bob Corker (Tenn.): “While the case for removal of FBI Director James Comey laid out by Deputy Attorney General Rod J. Rosenstein was thorough, his removal at this particular time will raise questions.”

Sen. John McCain (Ariz.): “While the President has the legal authority to remove the Director of the FBI, I am disappointed in the President’s decision to remove James Comey from office.”

[McCain added Tuesday night that when it comes to the Russian investigation, “I guarantee you there will be more shoes to drop, I can just guarantee it.  There’s just too much information that we don’t have that will be coming out.”]

Sen. Ben Sasse (Neb.): In a statement, “Regardless of how you think Director Comey handled the unprecedented complexities of the 2016 election cycle, the timing of this firing is very troubling... I have reached out to the Deputy Attorney General for clarity on his rationale for recommending this action.”

But other GOP senators disagreed with their above colleagues:

Sen. John Cornyn (Texas): The Senate’s No. 2 Republican told reporters that “obviously he’s been the center of controversy both among Democrats and Republicans at different times.”

Sen. Ted Cruz (Texas): In a statement, “Unfortunately, Mr. Comey had lost the confidence of both Republicans and Democrats, and, frankly, the American people.”

Sen. Lindsey Graham (S.C.): In a statement, “Given the recent controversies surrounding the director, I believe a fresh start will serve the FBI and the nation well.”

Sen. James Lankford (Okla.): In a statement, “It is unfortunate that over the past year the Director had lost the trust of so many people on both sides of the aisle.”  [The Hill]

White House officials used the Rosenstein letter as the key piece of evidence to justify Comey’s firing.  But then the White House said Comey’s dismissal came at the recommendation of both Attorney General Jeff Sessions and Rosenstein, though the AG, Sessions, had recused himself from the investigation into Russia interference in the presidential election, because of his failure to disclose a meeting with Russian Ambassador Kisylak. 

It was Session’s decision to step down on this matter that put Rosenstein in charge of the specific case.

The actual Russia investigation will continue under the supervision of acting FBI Director Andrew McCabe, a 20-year veteran of the bureau.  But the White House announced the search for a new director would begin immediately.

Separately, but related, White House Spokesman Sean Spicer could be out of a job due to an ‘embarrassing’ briefing on Tuesday.  Spicer was seen by multiple reporters hiding behind bushes at the White House until TV cameramen turned out their lights and agreed not to take video of the briefing Spicer then gave.

But then Spicer delivered a “cringe-worthy performance,” as described by the Washington Post, failing to offer a clear timetable or rationale for Trump’s abrupt decision to fire Comey.

“Just turn the lights off. Turn the lights off!” Spicer shouted, according to the Post.  Spicer then gave a very confused explanation of how Comey’s firing went down, blaming Rosenstein, then backing off.

Wednesday afternoon, Trump defended sacking Comey, arguing the former director “was not doing a good job.”

Reports emerged that Comey had requested more money and personnel for the FBI’s probe of Russian meddling in the 2016 election, though the veracity of this was called into question.

Comey reportedly made the request during a meeting last week with Rosenstein, but the department’s top spokeswoman, Sarah Isgur Flores, said these reports are “totally false.”

[Thursday, in the hearing before the Senate Intelligence Committee, acting FBI Director McCabe also said the FBI had not requested more resources and that they had what they needed to proceed.]

Wednesday evening, Comey sent a letter to agents and friends following his firing.

“I have long believed that a President can fire an FBI director for any reason, or for no reason at all.  I’m not going to spend time on the decision or the way it was executed.

“I hope you won’t either.  It is done, and I will be fine, although I will miss you and the mission deeply.”

Comey added that the FBI must continue “the mission of protecting the American people and upholding the Constitution.”

I believe a New York Times report by Maggie Haberman and Glenn Thrush from Wednesday that Trump had openly been talking about firing Comey for at least a week, and “the grumbling evolved into a tentative plan as he angrily watched the Sunday news shows at his Bedminster, N.J., golf resort.”  According to the report, though, Stephen Bannon, while sharply critical of the FBI, “questioned whether the time was right to dismiss Mr. Comey, arguing that doing it later would lessen the backlash.”

A Wall Street Journal story from Wednesday by Shane Harris and Carol E. Lee notes that “Mr. Comey became increasingly occupied with the (Russia) probe...

“Mr. Comey was concerned by information showing possible evidence of collusion, according (to people with knowledge of the matter and the progress of the FBI investigation).”

Thursday, in an interview with NBC News’ Lester Holt, Trump said he was thinking of “this Russia thing with Trump” when he decided to fire Comey.  Trump told Holt: “In fact, when I decided to just do it, I said to myself, ‘You know, this Russia thing with Trump and Russia is a made up story, it’s an excuse by the Democrats for having lost an election that they should have won.’”

This account flatly contradicted the White House’s initial account of how Trump arrived at his decision.

Trump also said in the interview that he had no intention of hindering the FBI’s Russia probe and that he wants the investigation “to be absolutely done properly.”

“I want that to be so strong and so good...I want to get to the bottom. If Russia hacked, if Russia did anything having to do with our election, I want to know about it.”

Trump denigrated Comey as “a showboat” and “a grandstander.”

So initially Trump aides said the president fired Comey simply because it was the recommendation of Attorney General Jeff Sessions and Deputy Attorney General Rod Rosenstein, the latter writing the memorandum detailing Comey’s handling of the investigation into Hillary Clinton’s private email server while secretary of state.

The official version also wanted us to believe Trump’s decision was not shaped by the ongoing probe, even though days before he had publicly called the inquiry, by the FBI as well as the Senate and House, “a total hoax” and “a taxpayer charade.”

But Thursday, Trump told Holt, “I was going to fire Comey....I was going to fire regardless of the recommendation.”

Trump also talked of a dinner he had with Comey at the White House, where “at that time he told me, ‘You are not under investigation.’”

Trump told Holt that three times Comey told him this; once at the dinner and the other two times over phone calls.

Yet this would mean the FBI director was discussing an ongoing investigation with the president – which Justice Department policy prohibits, though it was not legally wrong for Trump to ask the director if he was being investigated.

But you’d be hard-pressed to find anyone who believes the president’s account.  Comey’s temporary replacement, Andrew McCabe, told senators at a hearing Thursday morning that no White House officials had tried to interfere with the Russia probe.

As for Deputy AG Rosenstein, there were conflicting reports as to how upset he was over the coverage of the firing and how it was initially pinned on his memo, not just by White House spokespeople on Tuesday, but then Vice President Mike Pence on Wednesday, who repeatedly pointed to Rosenstein’s letter while describing the president’s decision.

Then on Friday, President Trump issued a veiled threat to Comey, as part of a morning tweetstorm.

“James Comey better hope that there are no ‘tapes’ of our conversations before he starts leaking to the press!”

It was unclear if Trump was suggesting he had recorded their conversations. 

The president wants us to focus on the positives in his first four months, but he likes to step on his own message.

Opinion....

Kimberley A. Strassel / Wall Street Journal

“Testifying last week before the Senate Judiciary Committee, James Comey recalled a moment that should have held more significance for him than it did. At the height of the presidential campaign, President Obama’s attorney general, Loretta Lynch, had chosen to meet with Bill Clinton on an airport tarmac.  That, said the now-former FBI director, ‘was the capper for me.’  Hillary Clinton’s emails were being probed, but Ms. Lynch was too conflicted to ‘credibly complete the investigation.’  So Mr. Comey stepped in.

“Donald Trump and senior Justice Department leaders might appreciate the impulse. According to Democrats and the media, Attorney General Jeff Sessions is too conflicted to recommend sacking Mr. Comey; the Trump administration is too conflicted to name a successor; the entire Justice Department and the Republican Congress are too conflicted to conduct true oversight.

“Entirely missing from this narrative is the man who was perhaps the most conflicted of all: James Comey.  The FBI head was so good at portraying himself as Washington’s last Boy Scout – the only person who ever did the right thing – that few noticed his repeated refusal to do the right thing.  Mr. Comey might still have a job if, on any number of occasions, he’d acknowledged his own conflicts and stepped back.

“Deputy Attorney General Rod Rosenstein’s memo to Mr. Sessions expertly excoriated Mr. Comey’s decision to ‘usurp’ Ms. Lynch’s authority and his ‘gratuitously’ fulsome July press conference.  But Mr. Comey’s dereliction of duty preceded that – by his own admission.  Remember, he testified that the Lynch-Clinton meeting was but the ‘capper.’  Before that, he told lawmakers, ‘a number of things had gone on which I can’t talk about yet that made me worry the department leadership could not credibly complete the investigation.’

“We don’t know what these things were, but it seems the head of the FBI had lost confidence – even before TarmacGate – that the Justice Department was playing it anywhere near straight in the Clinton probe.  So what should an honor-bound FBI director do in such a conflicted situation?  Call it out.  Demand that Ms. Lynch recuse herself and insist on an appropriate process to ensure public confidence.  Resign, if need be. Instead Mr. Comey waited until the situation had become a crisis, and then he ignored all protocol to make himself investigator, attorney, judge and jury.

“By the end of that 15-minute July press conference, Mr. Comey had infuriated both Republicans and Democrats, who were now universally convinced he was playing politics.  He’d undermined his and his agency’s integrity.  No matter his motives, an honor-bound director would have acknowledged that his decision jeopardized his ability to continue effectively leading the agency. He would have chosen in the following days – or at least after the election – to step down.  Mr. Comey didn’t....

“Colleagues describe Mr. Comey as an honorable man. The problem seems to be that his sense of perfect virtue made him blind to his own conflicts and the mess he had made.  New leadership at the FBI is a chance for a fresh start.”

Charles Krauthammer / Washington Post

“It was implausible that FBI Director James Comey was fired in May 2017 for actions committed in July 2016 – the rationale contained in the memo by Deputy Attorney General Rod Rosenstein.

“It was implausible that Comey was fired by President Trump for having been too tough on Hillary Clinton, as when, at a July news conference, Comey publicly recited her various email misdeeds despite recommending against prosecution.

“It was implausible that Trump fired Comey for, among other things, reopening the Clinton investigation 11 days before the election, something that at the time Trump praised as a sign of Comey’s ‘guts’ that had ‘brought back his reputation.’

“It was implausible that Trump, a man notorious for being swayed by close and loyal personal advisers, fired Comey on the recommendation of a sub-Cabinet official whom Trump hardly knew and who’d been on the job for all of two weeks.

“It was implausible that Trump found Rosenstein’s arguments so urgently persuasive that he acted immediately – so precipitously, in fact, that Comey learned of his own firing from TVs that happened to be playing behind him.

“These implausibilities were obvious within seconds of Comey’s firing and the administration’s immediate attempt to pin it all on the Rosenstein memo. That was pure spin. So why in reality did Trump fire Comey?

“Admittedly, Comey had to go.  The cliché is that if you’ve infuriated both sides, it means you must be doing something right.  Sometimes, however, it means you must be doing everything wrong.

“Over the past year, Comey has been repeatedly wrong.  Not, in my view, out of malice or partisanship (although his self-righteousness about his own probity does occasionally grate).  He was in an unprecedented situation with unpalatable choices  never in American presidential history had a major party nominated a candidate under official FBI investigation....

“Comey had to make up the rules as he went along.  He did.  That was not his downfall.  His downfall was making up contradictory, illogical rules, such as the July 5 non-indictment indictment of Clinton....

“There was ample bipartisan sentiment for letting Comey go. And there was ample time from Election Day on to do so.  A simple talk, a gold watch, a friendly farewell, a Comey resignation to allow the new president to pick the new director. No fanfare, no rancor....

“Instead we got this – a political ax murder, brutal even by Washington standards...No final meeting, no letter of resignation, no presidential thanks, no cordial parting....

“Why?  Trump had become increasingly agitated with the Russia-election investigation and Comey’s very public part in it.  If Trump thought this would kill the inquiry and the story, or perhaps even just derail it somewhat, he’s made the blunder of the decade.  Whacking Comey has brought more critical attention to the Russia story than anything imaginable.  It won’t stop the FBI investigation. And the confirmation hearings for a successor will become a nationally televised forum for collusion allegations, which up till now have remained a scandal in search of a crime.

“So why did he do it? Now we know: The king asked whether no one would rid him of this troublesome priest, and got so impatient he did it himself.”

Michael Goodwin / New York Post

“The president didn’t have just one good reason to act. He had a choice among many.

“The one he cited, Comey’s handling of the investigation into Hillary Clinton’s private server, is rich with irony, given its prominence in the campaign.  And the irony doesn’t stop, with Democrats who not so long ago were furious with Comey over the Clinton probe rushing out condemnations of Trump for firing him.

“ ‘Nixonian’ was a common theme, a shot both cheap and predictable. When you’re a hammer, everything is a nail.  When you’re a Democrat, everything is Watergate.

Bret Stephens / New York Times

“With Donald Trump, the tells are always easy.

“When the president says, ‘I’m, like, a smart person,’ you know he nurses deep insecurities about his intelligence. When he says, ‘I’m really rich,’ you know that he knows that you know that, really, he probably isn’t.

“And when he writes, as he did in his letter to the now-former FBI director, James B. Comey, that ‘while I greatly appreciate you informing me, on three separate occasions, that I am not under investigation,’ you know what keeps him up at night, too....

“In all this, the riddle wrapped in a mystery inside an enigma is Russia.

“Golf courses: Russia.  Mike Flynn’s lies to the vice president: Russia.  Jeff Sessions’ lies to the Senate: Russia.  Paul Manafort, Carter Page and Roger Stone: Russia.  WikiLeaks: Russia.  Donald Trump Jr.: Russia. The Bayrock Group: Russia.  Erik Prince’s diplomatic back channel: Russia.

“No one piece in this (partial) list is incriminating. And with Trump, the line between incompetence and nefariousness, misjudgment and misdirection, is usually a blurry one.

“Still, Jim Comey’s firing now brings two points into high relief. First, the administration is not being truthful when it claims the director was dismissed for what he did last summer.  Second, Donald Trump is afraid. A president who seeks to hide a scandal may be willing to risk an uproar.”

ObamaCare

Appearing on ABC’s “This Week” with George Stephanopoulos, House Speaker Paul Ryan said some of the following on Republican efforts to repeal and replace ObamaCare:

“(Let’s remember) what is happening right now.  ObamaCare is collapsing. ObamaCare isn’t working.  What good is ObamaCare for anybody, let alone for a person with preexisting conditions if you don’t have a health insurance plan that you can even get.

“So this is a rescue mission to make sure that we can achieve the goals we all want, which is getting the cost of coverage down and making sure that everyone has access to affordable health care, especially and including people with pre-existing conditions. That is what our bill does.

“So let me just say a couple of things.  You have got all of these health insurers. If they were doing so well, why would they be pulling out of the marketplace?  Over 1,000 counties, one in three counties in America, have one plan to choose from.

“Just this week in Iowa, their last statewide insurer said that they were going to have to pull out. So that means people in 94 of Iowa’s 99 counties will have zero choices.  Aetna just pulled out of Virginia. The law is collapsing. It’s not working.

“You can’t get health insurance in these places, whether you have a pre-existing condition or not. And so what we’re trying to do here, George, is step in front of this collapsing law and make sure that we can have a system that works, a system with choice and competition and affordable premiums....

“Under this bill, no matter what, you cannot be denied coverage if you have a pre-existing condition.  And under this bill, you cannot only not be denied coverage...you can’t be charged higher....You can’t charge people more if they keep continuous coverage.  The key of having a continuous coverage provision is to make sure that people stay covered and they move from one plan to the next if they want to....

“ObamaCare, the premiums are going up double digits. The deductibles are sky high. And choices are evaporating to the point where one in three counties in America have one insurer left. And now we’re learning those last insurers in many states are pulling out.

“So this is a crisis. We are trying to prevent this crisis. And we think we have better ideas.  And by the way, in Wisconsin, we had a good system. In Maine, they had a good system. Let the states – because states are different from one another, let the states perfect this while making sure we have multiple layers of protections for people with pre-existing conditions.”

Editorial / Wall Street Journal

“For all the media think pieces about the nature of truth in the Trump era, Democrats have their own alternative facts about ObamaCare.  To undermine the GOP case for repeal and replace, they claim the entitlement is working beautifully. But then what about the latest insurance giant to dump its ObamaCare ballast?

“Aetna said on Wednesday that it will withdraw individual market plans in Nebraska and Delaware, meaning it will participate in zero exchanges in 2018.  Last week the insurer bolted from Iowa and Virginia, and the four states were the last vestiges of its original ObamaCare expansion to 15 states. Even as the rest of its business is performing handsomely, Aetna expects to lose about $200 million on ObamaCare this year, on top of writedowns nearing $700 million between 2014 and 2016.

“Humana has also left the exchanges altogether, Anthem is edgy, and the familiar problem is ObamaCare’s structural undertow.  Despite subsidies and mandates, the regulations are too restrictive and insurers aren’t allowed to profitably sell products that can attract enough people to square the economies.

“The white flag is especially notable because Aetna led ObamaCare’s industry cheering section in 2009 and 2010 and was once inclined to accept the exchanges as temporary loss leaders to support the mission of universal coverage.  In the chaos of the law’s early years, liberals insisted everything would be fine by now.

“In a hilarious letter Tuesday, all 48 Senate Democrats instructed Republicans ‘to discourage the ongoing effort by the Administration to destabilize the health-care marketplace, which could lead to rising insurance premiums for all.’  Could?  ObamaCare is already doing a fine job of raising costs and reducing choices....

“The GOP’s American Health Care Act includes tools that can mitigate some of the damage, and over time nurture a richer, more liquid insurance market.  The failure to pass the reform this spring has contributed to business uncertainty, but there’s still time to provide more stability – though it is running out fast.

“If Congress can’t find a reform majority, then Democrats will flip their all-is-well narrative without a second thought and blame Republicans for every last horror story. The GOP will have no answer heading into the midterms.

“Over the longer term, a Republican failure to stand up a market-based ObamaCare replacement means the status quo of ever-more government, and there’s another warning in the Aetna news: In the first quarter, revenue from taxpayers exceeded revenue from its commercial business for the first time since the company was founded in 1853.”

Last weekend, Texas Republican Sen. Ted Cruz acknowledged that Senate Republicans face an uphill battle to pass an ObamaCare repeal bill, warning that a failure to do so would be “catastrophic.”

Wall Street

On the economic front, there was some important inflation data for April.  Producer prices rose a higher-than-expected 0.5%, 0.4% ex-food and energy.  For the 12 months, the PPI is up a strong 2.5%, 1.9% on core.

Consumer prices rose 0.2%, in line, and 0.1% on core.  For the 12 months, the CPI is up 2.2%, though this is down from March’s 2.4% level.  The April core figure year-over-year is 1.9%.

Add it up and inflation is at the Federal Reserve’s target 2% for both PPI and CPI, which certainly adds credence to those calling for another rate hike at the June 13-14 meeting.

One other...April retail sales were up a solid 0.4%, which while a little below expectations, was essentially up across all categories.

Europe and Asia...French Election....

Not a lot of broad-based economic news out of the eurozone, with the European Commission revising upward its forecasts of EA19 growth this year to 1.7%, up from 1.6%, and 1.8% in 2018.

Aside from the risks over Brexit, the EC noted other possible drags could be caused by uncertainties surrounding U.S. economic and trade policy, China’s economy and broader geopolitical tensions.

The EC says inflation will only be 1.6% this year and then 1.3% next.

On to the French Election: Emmanuel Macron became France’s youngest leader since Napoleon Bonaparte as the 39-year-old whipped the far-right’s Marine Le Pen, 66.1% to 33.9% on Sunday.  The French polls were darn good going back over a year, consistently showing that if Le Pen did make it into a run-off, she’d lose badly.  But there was also a 25% abstention rate, the highest this century, with another 9% casting blank or spoiled ballots.

Macron’s story is a remarkable one, the 39-year-old never having stood for elected office before and starting his political party just a year ago.  Monday he changed the name of it from En Marche to La Republique En Marche (Republic on the Move).

The next step for him was to pick candidates to run on the ticket in parliamentary elections on June 11 and 18.  Macron wants/needs a governing majority and he has no seats as of today.

Thursday, Macron’s party announced a list of 428 candidates, a partial list as En Marche previously said it would stand for every one of the National Assembly’s 577 seats.  Macron did fulfil a campaign promise to have women represent one half of his candidates, while over half come from civil society.  The party secretary said that with regards to the remaining available slots, they wanted to leave the door open for politicians of other parties to come over to Macron’s side.

Polls show Macron’s party picking up 24%-26% of the vote in the first round June 11, while the Republicans (Conservatives) and National Front would win about 22%, and the far-left France Unbowed 13%-15%.  The Socialists, still suffering from Francois Hollande’s dismal approval ratings, bring up the rear.

All of this means Macron is going to have to do some wheeling-dealing to gain some kind of majority to work with.

Macron also faces a deeply divided country, and he’s the first from outside the two main political parties in the country since the founding of the modern republic in 1958.  “I know the divisions in our nation,” he said in his victory remarks on Sunday, “which led some to vote for extremist parties.  I respect them.  I will work to recreate the link between Europe and its peoples, between Europe and its citizens.”

Needless to say, European leaders were thrilled by Macron’s victory.  Jean-Claude Juncker, the president of the European Commission, told him: “I am delighted that the ideas you defended of a strong and progressive Europe, which protects all its citizens, will be those that you will carry into your presidency.”

President Trump tweeted his congratulations and then called Macron the next day to say he looked forward to working with him.

As for Marine Le Pen and her National Front party (FN), she signaled there will be changes, following the parliamentary elections, with a probable name change as she vows to lead the “new force” into an era where it represents the true opposition in France; the “patriots” against the “globalists,” as she put it.

But she needs seats in parliament, and of the 577 up for grabs, today the FN has only two and most prognosticators have the party increasing this total to just between 15 and 25.

To close the circle on the election, though, I do have to add that the National Front did rack up its biggest vote tally ever at more than 10 million, and while her 34% fell short of some expectations, it was essentially double the 18% Le Pen’s father, Jean-Marie, picked up in his run-off in 2002 against Jacques Chirac.

Marine Le Pen’s leadership of the FN is not in doubt, yet.  Her niece, Marion Marechal-Le Pen, a National Front lawmaker, has a bright future but she is only 27.  After 2022, though, Marion could take over.  She was critical of Marine at times and how she ran her campaign, including her stance on the euro which definitely hurt.  Marion said on France 2 television: “There are clearly lessons to be learned.  We clearly didn’t manage to get this election to be understood as a referendum for or against France, a referendum for or against immigration...for or against the European Union as we know it.”

Lastly, it could yet be a long summer in France.  Far-left leader Jean-Luc Melenchon said Macron was planning a war on the French social system and called on his voters to mobilize against the ex-banker in the June elections.

Since 1999, successive French presidents have sought to undo items such as the 35-hour workweek law, but protests from the likes of Melenchon have done them in.  He is once again promising chaos if Macron attempts to change too much.

Eurobits....

--The yield on Greek bonds fell to their lowest level since a private sector bond restructuring five years ago, as investors are betting on a bailout breakthrough this spring, buoying the economy.  The 10-year bond peaked at 27% in June 2012, the height of the financial crisis, and this week fell to 5.50%, which is pretty staggering.  Some very smart people made a lot of money with this trade.  [If memory serves me right, David Tepper being among them.]

--Germany’s GDP rose 0.6% in the first quarter, better than the fourth quarter’s 0.4% pace, which will help buoy Chancellor Angela Merkel’s re-election hopes with September federal elections looming.  Year-over-year growth was 1.7% in Q1.

Speaking of Merkel’s re-election campaign, her conservatives won a big victory over their Social Democrat rivals in a vote last weekend in the northern state of Schleswig-Holstein, which bodes well for her in September.  Merkel’s Christian Democrats (CDU) took 33% of the vote, up from 30.8% the last election there, while the Social Democrats (SPD) won 26%, down from 30.4%.

After former European Parliament president Martin Schulz announced in January he would run against Merkel, the SPD surged in the polls, but now they have plateaued.

Meanwhile, the anti-immigrant Alternative for Germany (AfD) continues to lose support and scored only 5.5% in the state vote.

--Bank of England Governor Mark Carney warned that U.K. households face a difficult year, which is why the BOE continues to keep interest rates on hold.

Carney believes the U.K.’s departure from the European Union will be smooth, but consumers are impacted by the uncertainties in the process, plus real wage growth remains weak.

“This is going to be a more challenging time for households,” Carney said at a press conference on Thursday.  “Wages won’t keep up with prices for goods and services they consume.”

Officials cut their forecast for growth this year to 1.9%, while inflation is projected to be 2.7%, owing to a weaker pound.

We have a lull in the Brexit talk until the U.K.’s vote on June 8, after which formal negotiations will commence...and then it’s going to be one sound bite after another for 18 months or thereabouts.

Turning to Asia, China reported exports rose less than expected in April, up 8% year-over-year, while imports were up 11.9%.  March exports had risen 16.4%.

Total April auto sales in China fell 2.2% vs. a year ago, according to the Chinese Automobile Manufacturers Association, while passenger vehicle sales declined 3.7%, the biggest fall since July 2015.  But for the first four months, vehicle sales remain 4.6% higher.  That said, 2016 was a record year in both the U.S. and China and no doubt demand is slowing.

Toyota Motor Corp.’s China sales increased 7.2% in April, with sales for the first four months up 3.1%, the company said.

Ford Motor Co. said April sales were up 11%, but were down 12% for the first four months.

General Motors saw its sales fall 1.9% in April, with year-to-date down 4.5%.

Volkswagen AG reported a 4.3% increase last month, but sales are down 1.9% for the year.

Separately, China’s April power consumption rose 6% from a year earlier, according to the energy bureau, while from January to April, power consumption increased 6.7%.

But there was a big announcement on Thursday, Friday in China, as the U.S. and China reached an important trade deal that opens the Chinese market to U.S. credit rating agencies and credit card companies, plus China is lifting the ban on U.S. beef imports and will accept U.S. shipments of liquefied natural gas.

In return, Americans can eat cooked chicken from China and Chinese banks can enter the U.S. market, the latter a big deal for China’s image.  No longer are you hearing words from the White House such as “currency manipulator” or “unfair trade partner.”

This is also huge for the U.S. cattle industry.  I like it.  As for Chinese chickens, well...I’m going to stick with Perdue, thank you very much.  But China will certainly have a captive audience here.

I didn’t get a chance to read the formal statement accompanying the deal, but the U.S. also recognized the importance of China’s One Belt and One Road initiatives in Southeast Asia.

Street Bytes

--Stocks were mixed as Nasdaq hit new highs, up 0.3% on the week, while the Dow Jones and S&P 500 fell a bit, -0.5% and -0.3%, respectively.

--U.S. Treasury Yields

6-mo. 1.01%  2-yr. 1.29%  10-yr. 2.33%  30-yr. 2.99%

--Shares in Apple climbed this week following news Warren Buffett’s Berkshire Hathaway has been buying up more shares, taking the stake to more than $19bn, up from $7.1bn at the end of 2016.  Apple’s market value crossed $800bn for the first time.

--The retail sector got slammed anew, specifically the department store crowd, as Macy’s shares cratered nearly 18% on Thursday after it reported same-store sales fell 5.2%, steeper than the 3% analysts had forecast.  This came on top of a 6.1% drop in the year ago period.  [I like Macy’s, but I can’t imagine how the store employees come to work every day.  Many of their friends are gone.  They see falling traffic.  Depressing.]

Net sales fell nearly 8% from a year ago to $5.34bn, also shy of expectations.

And profits fell to $70m for the three months to April 29, down from $116m a year ago.

Macy’s reiterated its forecast for comp sales for fiscal 2017, down 2-3%.

Discount department store Kohl’s reported its fifth straight quarter of falling same-store sales, even after a tie-up with Under Armour to sell their athletic apparel in its 1,160 stores.  Comp sales fell 2.7%, far more than expected.

Revenue declined 3.2% to $3.84bn, also short of the Street.  Earnings did beat, but the shares fell 8%.

The company didn’t provide specifics on how sales of Under Armour products are doing in their stores.

Then on Friday, shares in Nordstrom and JC Penney both cratered 10-12%, as the former reported comp-store sales for the quarter that were down 0.8%, while JC Penney’s fell a larger than expected 3.5%.

--Shares in Snap Inc. cratered over 20% after the company’s first earnings report and conference call as a public company.  Snap announced it added 8 million daily active users in the period, for a total of 166 million, with growth from a year earlier slowing to 36 percent.  First-quarter revenue of $149.6 million also missed the $158.6 million average analyst estimate, though this was up 286% from last year’s first quarter, but down from the fourth quarter’s $166 million.

CEO and co-founder Evan Spiegel dismissed concerns over the company’s performance, “If you want to be a creative company, you have got to be comfortable and enjoy the fact that people copy your products if you make great stuff,” he said, referring to Facebook’s copying of some of Snapchat’s most popular features, including its tool for short videos, “stories.”

The drop in the shares meant Spiegel and co-founder Bobby Murphy lost about $1 billion on paper.

Spiegel would provide no financial guidance, nor discuss future products, saying, “We’re kind of famous for not giving guidance on the product pipeline.”

Spiegel has insisted that the speed at which Snapchat adds users is dependent on how soon high-speed cell service arrives in the developing world and how quickly the company launches new features.

--Walt Disney Co. reported revenue growth of 3% for the three months ended April 1, to $13.34 billion, and an 11% increase in net income to $2.39 billion compared with the same period a year earlier.  The net income per share beat expectations, while revenue fell short.

But CEO Robert Iger on Tuesday’s conference call had to spend much of his time once again discussing the fate of ESPN, which has lost momentum in recent years while other divisions at Disney boom.  ESPN recently laid off about 100 of its 8,000 employees, in the latest round of cost-cutting, as viewership for non-live sports, including its signature SportsCenter program, decline.

Over the past five years, ESPN has gone from 99 million subscribers to 87.44 million, according to Nielsen. Disney is planning a new, ESPN-branded stand-alone streaming service.

Meanwhile, Disney’s theme-parks unit saw revenues increase 9% to $4.3 billion, with a 20% increase in operating income to $750 million.  Attendance at domestic parks was up 4%, while Shanghai Disney Resort, which opened last June, was profitable for the first time last quarter.

Despite comparisons to last year when “Star Wars: The Force Awakens” was in theaters, the movie studio reported revenue was down only 1% to $2.03 billion, with operating income up 21% to $656 million.  March’s “Beauty and the Beast” was a huge hit, taking in more than $1.1 billion.

--The Peanuts gang was sold by Iconix Brand Group, a licensing firm, to DHX Media of Halifax for $345 million.  DHX owns various kids entertainment properties.

Iconix is exiting the entertainment business and made a nice profit on its 80 percent stake in Peanuts, which it acquired in 2010 for $175 million.

--Shares in Wendy’s hit a 10-year high this week as the fast food company beat the Street on earnings. Same-store sales rose 1.6%, which was less than the comparable period a year ago, but represented Wendy’s 17th consecutive quarter of positive same-store growth which is darn good in today’s environment.

International sales rose 14% in the quarter.

--Adidas struck a deal worth $425 million to sell its TaylorMade, Adams Golf and Ashworth golf brands to U.S. private equity group KPS Capital Partners.

The world’s second largest sportswear group is exiting golf as it declines in popularity, Adidas is focusing on footwear and apparel.

--Time Inc., the owner of Time, People and Sports Illustrated, continues to flounder with steeper than expected losses and revenue declines in the first quarter.

Revenue fell 8% to $636m, with advertising sales falling 8% on a 21% drop in print ad revenue.  The company has been slashing expenses and is preparing further cost cuts.

Time Inc. cut its quarterly dividend to 4 cents from 19 cents, a move that it said would save $60m annually, to reduce leverage and free up cash for investments.

--Wells Fargo announced it was cutting another $2bn in costs by the end of 2019.  Wells plans to close about 450 branches in 2017 and 2018 as part of the plan, “reducing redundant locations” and “consolidating less ideally located branches.”

Don’t close my three, Wells Fargo!  [All strategically located for groceries, beer and the post office.  ‘Domestic,’ of course.]

--Twenty-First Century Fox disclosed it had incurred costs of $10 million “related to settlements of pending and potential litigations” during its fiscal third quarter in the aftermath of various sexual harassment allegations at Fox News.

In the nine months leading up to March 31, the company said it had incurred $45 million in costs related to similar allegations.

Meanwhile, on an analyst call, executives Lachlan and James Murdoch expressed their high expectations that regulators would approve the company’s $14.3 billion buyout of Sky, the British satellite TV giant.

On the ratings front, Rachel Maddow on MSNBC has started to win her 9:00 time slot by certain measures (like the 25-to-54 demo), while Tucker Carlson, who replaced Bill O’Reilly at 8 p.m., has seen his numbers fall after a strong start, down 13% year-to-year, though he still wins the slot overall.

Carlson has retained most of the key 25-to-54 age group, as reported by Nielsen.

Carlson is averaging 2.75 million viewers, down from 3.17 million during the same period in 2016; most of the losses being in the age 55 and up group.

But the advertisers have returned to the 8:00 hour.  [Stephen Battaglio / Los Angeles Times]

Fox broadcast network’s programming continues to present challenges.  The post-“American Idol” lineup has been a disappointment, including the reboot of “24,” which I personally loved.  “Empire” remains a hit, but relative ratings are plunging.

--Baltimore-based Sinclair Broadcast Group Inc. is acquiring Tribune Media and its 42 TV stations, giving the once low-profile company a powerful nationwide platform to potentially launch a right-leaning alternative to rival Fox News.

Sinclair already owns 139 stations in the U.S., the largest such owner, but it does not have any outlets in Los Angeles or New York, though with the Tribune acquisition, it would have a major footprint in the two largest markets, plus Chicago, with KTLA, WPIX in New York and WGN.

Tribune is the former parent company of the Los Angeles Times and Chicago Tribune, with the two spun off into a new company – now named Tronc Inc. – in 2014.

The deal is subject to FCC approval.

--Hertz shares fell sharply after the car-rental chain reported a quarterly loss of $223 million, compared with a loss of $52m in the year-ago period, wider than the Street forecast as the company continues with its turnaround efforts.

Total revenues fell 3 percent from a year ago to $1.92bn, shy of forecasts.

Prices of used cars have been dropping, while part of the company’s turnaround efforts include selling off its aging cars and revitalizing its fleet.  Plus, ride-sharing competition from the likes of Uber and Lyft doesn’t help.

--Telecom giant BT announced it would be shedding 4,000 jobs worldwide over the next two years and is stripping its CEO of his annual bonus.

The issue of bonuses, for the CEO, Gavin Patterson, and other execs, has to do with the costs involved in an accounting scandal at BT’s Italian unit, which had been overstating profits for years.

--Shares in Boeing fell after the company was forced to halt test flights of its new 737 MAX aircraft due to possible issues with the engine, which GE is involved in the manufacturing of.

The stoppage came just days before Boeing was due to make its first delivery of the aircraft to a customer, though Boeing said it was sticking with plans to begin MAX deliveries this month.

American Airlines and Southwest are among those who have placed orders, while earlier this year, Indian airline SpiceJet (which runs its aircraft on turmeric and peppercorn) placed an order for 205 new planes from Boeing that was said to be worth $22bn.

The MAX model is a more-efficient version of Boeing’s best-selling previous 737 model.

--Bloomberg reports that an April 27 freeze in Bordeaux, with temps below freezing, threatened to cause damages in excess of $1 billion to the French wine industry, which has already been losing global share in recent years.    Frost ravaged vineyards from Bordeaux to Burgundy to Champagne.

--John Brennan of USA TODAY had a piece on Atlantic City’s revival, yes, revival.

“Casinos are turning profits.  Plans were announced recently for a $375 million renovation and reopening of Trump Taj Mahal by Hard Rock Casino, and Stockton University just broke ground on a satellite campus.  A luxury apartment complex, the first to be built in decades, is under construction. The city’s credit rating has improved.”

This all comes after a decade when half the city’s casinos closed and 10,000 people lost their jobs.  A.C.’s finances were shot and the state took control in November.

The opening in 1978 of Resorts casino had spurred a revival that lasted through 2006, with casino revenues up every single year through 2006, but then came another downturn, especially after New York and Pennsylvania opened up rival operations, and Atlantic City’s casino revenues fell every year through 2015.  I know I haven’t been to A.C. since the early 2000s (and that was to see Don Rickles more than anything else).  Instead, I’ve been to a Sands casino in Bethlehem, Pa., a little over an hour from me, as opposed to a trek to A.C., which is over two hours.

By mid-summer, a project along the lines of the London Eye is scheduled to open at the Steel Pier, a 200-foot-high observation wheel with large climate-controlled gondolas.

Yes, crime and high unemployment remain in Atlantic City, but all the construction jobs coming in, plus permanent university jobs at the Stockton complex, have begun to stem the bleeding.

--We note the passing of Stanley Weston, inventor of the G.I. Joe action figure and a pioneer of the licensing business.  He was 84.

Weston was born in Brooklyn in 1933 and served in the Army shortly after the Korean War ended.  He returned to New York and took a job with advertising agency McCann Erickson, where he soon discovered a talent for the newfound licensing and merchandising industry, striking out on his own to found Weston Merchandising.

When Mattel’s Barbie dolls were introduced in 1960, Weston realized boys were an untapped market and so he conceived of the idea of a military action figure and in 1963 sold what would become G.I. Joe to Hasbro.  It was a runaway hit.

Later, Weston renamed his company Leisure Concepts, and represented the likes of Farrah Fawcett, Nintendo and the World Wrestling Federation, as well as TV shows including Alf and Welcome Back, Kotter.

In 1989, the inaugural class for the Licensing Industry Hall of Fame was announced and there was Stanley Weston, alongside Walt Disney, George Lucas and Jim Henson, among others.  [AdWeek]

Foreign Affairs

Iraq/Syria/Russia/Turkey/Iran: President Trump approved a plan to provide Syrian Kurds with heavy weaponry to aid in the battle to retake Raqqa from Islamic State, the Pentagon announced.

The Kurdish militia, YPG, contains the most experienced fighters among the U.S.-supported opposition, but Turkey has long objected, insisting that the YPG are linked with the Kurdistan Workers’ Party (PKK), which both Turkey and the U.S. view as a terrorist group.  Turkey has been battling the PKK for decades.

Turkey wants to stop the rebels from taking more territory in Syria.

President Erdogan is meeting with President Trump in Washington this coming week and the Kurds will be topic one, no doubt.

To placate Ankara, the United States is going to be sharing more intelligence with Turkey.

A big issue regarding Raqqa specifically is who controls the city once ISIS falls.  Certainly Turkey and its Syria Arab allies won’t stand for the Kurds holding onto it.

As for the establishment of “safe zones,” or what military officials are calling “de-escalation zones” in Syria that Russia, Iran and Turkey recently agreed to establish, the U.S. dismissed a Russian admonition that U.S. aircraft are barred from flying over them.

A State Department official said over the weekend, “The coalition will continue to strike ISIS targets in Syria...at the same relentless pace as it is proceeding now.”

It’s not known just how the topic was handled in discussions President Trump had with Russian Foreign Minister Lavrov this week.

Iran: The presidential election is next Friday, May 19.  This is going to be interesting.  Cleric Seyyed Raisi is the preferred candidate of Supreme Leader Khamenei, but some surveys have him trailing President Hassan Rouhani.  However, polling data is unreliable here.

There are six candidates and it doesn’t appear anyone will reach 50%, so this will necessitate a run-off one week later.

Separately, officials in both Iran and Saudi Arabia exchanged rather harsh words this week, starting with remarks by Saudi Deputy Crown Prince Mohammed bin Salman, who said that any struggle for influence between the Sunni Muslim kingdom and the revolutionary Shiite theocracy ought to take place “inside Iran, not in Saudi Arabia.”  To which Iranian Defense Minister Hossein Dehghan was quoted by an Iranian news agency as saying, “If the Saudis do anything ignorant, we will leave no area untouched except Mecca and Medina.”

Afghanistan: President Trump has been given recommendations for adding at least 3,000 more U.S. troops to the fight against the Taliban in Afghanistan by U.S. military leaders.  The request apparently also includes a request for additional NATO troops of 3,000-5,000.

There are 13,000 NATO troops currently in the country, with 8,400 of them being U.S.

Last weekend, the Taliban announced they had seized a district just a few kilometers from the northern city of Kunduz, with thousands of families forced to leave their homes.  They also apparently control the main road to the east of the city, which is a major supply route to Kabul.

President Trump is expected to make a decision on troop strength prior to a NATO summit on May 25.

Separately, U.S. and Afghan officials announced last weekend that U.S. and Afghan special forces took out the head of Islamic State in Afghanistan, Abdul Hasib, in an operation April 27

Israel: At a televised speech, Hizbullah leader Sayyed Hassan Nasrallah announced his militia was dismantling its positions along Lebanon’s eastern border with Syria, and that this area was now the “responsibility of the state,” with no need for Hizbullah’s presence.  He then said that any war with Israel could take place inside Israeli territory, but appeared to tamp down fears of an imminent conflict.

South Korea: The nation has a new leader, Moon Jae-in, who has already been sworn in after winning the special presidential election 24 hours earlier.

Moon’s inaugural was low-key, barely 10 minutes, as he told the nation that he wanted a more egalitarian society, while regarding North Korea, he said he would go to Pyongyang but only if the conditions were right – though Moon didn’t specify what the conditions might be.  Moon said he would “do everything I can to build peace on the Korean peninsula.”

Moon is known for his liberal views and he has vowed to unify a country divided by the corruption scandal that saw his predecessor, Park Geun-hye, impeached.

He also said he wanted to meet Donald Trump and signaled he was not anti-American.

Any tension between Washington and Seoul will come about over the Trump administration taking a hard line against Pyongyang, at the same time Moon favors negotiation.

Moon is the son of refugees from North Korea and served in South Korea’s special forces before becoming a human rights lawyer.  He is the first liberal leader of his country in about a decade.

Aside from dealing with North Korea, one of Moon’s biggest challenges will be enacting reforms to limit the power of big business, while balancing relations between the U.S. and China.

David Straub, a former director of Korean affairs at the State Department and a senior fellow at a think tank in South Korea, warned of “serious policy differences between the U.S. and South Korean presidents” over the North and related issues.  Straub added they could lead to “significantly increased popular dissatisfaction with the United States in South Korea.”  [New York Times]

One immediate issue to watch is the American missile defense system, THAAD, which has just been deployed in South Korea, Moon having previously said he wished he had the opportunity to weigh in on it before it was a fait accompli.  But it’s unlikely he will undo it, which would be bowing to China.

Final results on Tuesday’s vote show that Moon took 41.1%, while conservative candidate Hong Joon-pyo received 25.5%. A centrist garnered 21.4%.  There is no 50% run-off rule here.

I just have to add the 41.1% compares with an exit poll that showed 41.4%...pretty, pretty good.

Editorial / Wall Street Journal

“Mr. Moon’s desire to appease North Korea marks a return to the Sunshine Policy that failed in the mid-2000s when he was an aide to center-left President Roh Moo-hyun.  Mr. Moon wants to pursue reunification based on economic integration, offering a formal peace process if the North will give up its nuclear weapons. He also wants to reopen the Kaesong Industrial Zone, which provided the North with $100 million a year in hard currency until its closure in 2016.  This ignores Pyongyang’s long record of broken promises and its clear intention to reunify the Korean Peninsula on its terms using nuclear weapons as leverage. In recent weeks the North has detained two more U.S. citizens, a reminder that the regime treats engagement as an opportunity to take hostages.

“All of this will complicate the Trump Administration’s attempt to increase pressure on Pyongyang as the North develops nuclear missiles capable of hitting Seattle.  North Korea will try to drive a wedge between the U.S. and South Korea to re-establish its cash lifeline, and China may pressure Mr. Moon to reverse the South’s recent deployment of the THAAD missile-defense system.  But the only chance of ending the nuclear threat is a united front toward the North and its Beijing patrons.

“President Trump inadvertently assisted Mr. Moon’s election with his ill-timed demand that South Korea pay for THAAD, though his aides walked that back.  Mt. Trump has to work with Mr. Moon but he’ll have to be clear that the North now threatens the U.S. mainland as well as South Korea....

“Mr. Moon says the U.S.-Korea alliance will remain the cornerstone of his country’s security. That’s good to hear, but Mr. Trump will have to be clear that a return to appeasement is unacceptable.”

China: Beijing is further strengthening controls over the Internet, pledging to control search engines and online news portals.

This is part of President Xi Jinping’s policy of “cyber sovereignty,” with the ruling Communist Party playing the leading role in limiting and guiding online discussion.

This is on top of existing controls, including the blocking of Google and Facebook.

Russia: The White House said that in the meeting between President Trump and Russian Foreign Minister Sergei Lavrov, the issue of Russia’s alleged interference in the 2016 election was not substantively raised, just “referenced.”

Lavrov said after, “President Trump and I spoke about concrete things. Neither of us touched on this bacchanalia.”

Trump described his interaction with Lavrov as a “very, very good meeting” and that both sought to end the “horrible, horrible killing in Syria as soon as possible and everybody is working toward that end.”

Russian ambassador Sergey Kislyak was also present.

President Trump was apparently livid when photos of the three emerged on Russian web sites after.  Trump claims he didn’t know the photographer in the room was with TASS.

When asked by reporters if FBI Director Comey’s firing cast a shadow over their discussions, Lavrov dismissed the question.  “Was he fired?  You’re kidding, you’re kidding,” he said.

Russia has said it is working toward establishing a meeting between Trump and Vladimir Putin.

Separately, Russian opposition leader Navalny was allowed to leave the country for medical treatment, confirming he was in Barcelona, where he underwent an operation on his right eye, following an attack last month in Moscow.

Navalny said his vision “won’t be restored for a few months.”

Random Musings

--Presidential approval ratings:

Gallup tracking poll, 38% approval; Rasmussen tracking poll, 48%.  [As of Wednesday and Thursday, respectively.]

A May 10 Quinnipiac University national poll of American voters revealed some of the following:

President Trump’s job approval was just 36%, 58% disapproving.  That split was 40-56 on April 19.

Among Republicans it’s 82-13; 7-90 among Democrats.

Among Independents, which is what I really focus on, the approval/disapproval split is 29-63, when it was 38-56 April 19. To me this has a direct bearing on the tight congressional races that loom in just 18 months.

By a 61-33 margin, American voters don’t believe the president is honest.

By a 58-37, they do not approve of the way the media is covering Trump.

By a 71-22, voters disapprove of the way Republicans are doing their job in Congress.  They disapprove of the job Democrats are doing by a 58-34 margin.

--Last Sunday, President Barack Obama was given the 2017 John F. Kennedy Profile in Courage Award by the John F. Kennedy Library and Foundation.  In his 1957 book, “Profiles in Courage,” JFK profiled eight senators who took unpopular but ultimately good positions despite the political risk.  In his 30-minute speech, President Obama invoked the debate over the Affordable Care Act and called on members of Congress to protect those who are sick and vulnerable.

I read the entire speech on Time.com and I was sickened by the following:

“And so by the time the vote came up to pass the Affordable Care Act, these freshmen congressmen and women knew that they had to make a choice. That they had a chance to insure millions and prevent untold worry and suffering and bankruptcy, and even death, but that this same vote would likely cost them their new seats, perhaps end their political careers.

“And these men and women did the right thing. They did the hard thing.  Theirs was a profile in courage. Because of that vote, 20 million people got health insurance who didn’t have it before.

“And most of them – and most of them did lose their seats, but they were true to what President Kennedy defined in his book as a congressional profile in courage: the desire to maintain a reputation for integrity that is stronger than the desire to maintain office.  Because of that vote, 20 million people got health insurance who didn’t have it before....

“I hope that current members of Congress recall that it actually doesn’t take a lot of courage to aid those who are already powerful, already comfortable, already influential. But it does require some courage to champion the vulnerable and the sick and the infirm, those who often have no access to the corridors of power.

“I hope they understand that courage means not simply doing what is politically expedient but doing what they believe deep in their hearts is right. And this kind of courage is required from all of us....Those of us not in elected office have to show some courage. And we’re prone to bestow the mantel of courage too easily on the prominent and the powerful and then too eager to wrap ourselves in cynicism when they let us down because they weren’t perfect....

“John F. Kennedy knew that our best hope and our most powerful answer to our doubts and to our fears lies inside each of us, in our willingness to joyfully embrace our responsibility as citizens, to stay true to our allegiance, to our highest and best ideals, to maintain our regard and concern for the poor and the aging and the marginalized, to put our personal or party interest aside when duty to our country calls or when conscience demands.

“That’s the spirit that has brought America so far and that’s the spirit that will always carry us to better days.

“And I take this honor that you have bestowed on me here tonight as a reminder that, even out of office, I must do all that I can to advance the spirit of service that John F. Kennedy represents.”

I was sickened reading this passage because of Syria…a real failure in courage back in 2012, when there were ‘only’ 20,000 dead, no ISIS and no Russian involvement. 

But it was all about the election.

--John McCain / New York Times

“Some years ago, I heard Natan Sharansky, the human rights icon, recount how he and his fellow refuseniks in the Soviet Union took renewed courage from statements made on their behalf by President Ronald Reagan. Word had reached the gulag that the leader of the most powerful nation on earth had spoken in defense of their right to self-determination. America, personified by its president, gave them hope, and hope is a powerful defense against oppression.

“As I listened to Mr. Sharansky, I was reminded how much it had meant to my fellow P.O.W.’s and me when we heard from new additions to our ranks that Mr. Reagan, then the governor of California, had often defended our cause, demanded our humane treatment and encouraged Americans not to forget us.

“In their continuous efforts to infect us with despair and dissolve our attachment to our country, our North Vietnamese captors insisted the American government and people had forgotten us.  We were on our own, they taunted, and at their mercy.  We clung to evidence to the contrary, and let it nourish our hope that we would go home one day with our honor intact.

“That hope was the mainstay of our resistance....

“In a recent address to State Department employees, Secretary of State Rex Tillerson said conditioning our foreign policy too heavily on values creates obstacles to advance our national interests.  With those words, Secretary Tillerson sent a message to oppressed people everywhere: Don’t look to the United States for hope.  Our values make us sympathetic to your plight, and when it’s convenient, we might officially express that sympathy. But we make policy to serve our interests, which are not related to our values.  So, if you happen to be in the way of our forging relationships with your oppressors that could serve our security and economic interests, good luck to you.  You’re on your own.

“There are those who will credit Mr. Tillerson’s point of view as a straightforward if graceless elucidation of a foreign policy based on realism.  If by realism they mean policy that is rooted in the world as it is, not as we wish it to be, they couldn’t be more wrong.

“I consider myself a realist. I have certainly seen my share of the world as it really is and not how I wish it would be.  What I’ve learned is that it is foolish to view realism and idealism as incompatible or to consider our power and wealth as encumbered by the demands of justice, morality and conscience.

“In the real world, as lived and experienced by real people, the demand for human rights and dignity, the longing for liberty and justice and opportunity, the hatred of oppression and corruption and cruelty is reality.  By denying this experience, we deny the aspirations of billions of people, and invite their enduring resentment....

“To view foreign policy as simply transactional is more dangerous than its proponents realize. Depriving the oppressed of a beacon of hope could lose us the world we have built and thrived in.  It could cost our reputation in history as the nation distinct from all others in our achievements, our identity and our enduring influence on mankind.  Our values are central to all three.

“Were they not, we would be one great power among the others of history. We would acquire wealth and power for a time, before receding into the disputed past. But we are a more exceptional country than that.

“We saw the world as it was and we made it better.”

--The U.S. Immigrations and Customs Enforcement (ICE) announced it had arrested 1,378 people over the last six weeks in a massive gang-related operation, with nearly 1,000 of those taken in confirmed as gang members – involved in cross-border criminal activity.  More than 900 were U.S. citizens.

--Maureen Callahan / New York Post

“He rose to fame parodying a blowhard. Is he aware he’s become one?

“Last Tuesday (Ed. May 2), ‘Late Show’ host Stephen Colbert – who’d been struggling in the ratings until the election – made national headlines for a monologue that, as it does nightly, skewered  President Trump....

“ ‘Sir,’ Colbert continued, ‘you attract more skinheads than Rogaine.  You have more people marching against you than cancer.  You talk like a sign-language gorilla that got hit in the head.  In fact, the only thing your mouth is good for is being Vladimir Putin’s c—k holster.’

“The monologue isn’t offensive politically. It’s offensive because it’s just not funny.  Colbert fails to see the irony in taking umbrage at Trump’s crude insults by hurling crude insults.

“In a recent piece on Colbert in The New Yorker, TV critic Emily Nussbaum, formerly a fan, noted Colbert’s comedic devolution.  ‘Attacking Trump isn’t in itself subversive,’ she wrote, adding that his Trump-focused monologues ‘feel cognitively draining, not unlike political punditry.’

“And it’s not just Colbert. There’s an archness and stridency among his fellow ‘Daily Show’ alums like John Oliver and Samantha Bee, and it’s unclear what they hope to accomplish.  Oliver quite literally yells for 30 minutes at an audience that already agrees with him....

“In a recent, wide-ranging interview with New York Magazine, David Letterman cast shade on his successor’s anti-Trump fixation.

“ ‘A lot of people have been able to root themselves in the Trump tsunami, and Stephen is one of them,’ Letterman said.  ‘I’m aware that Stephen has been able to solidify his position.’

“So, too, have others: Seth Meyers is just as political, but he has a much lighter touch and meets the Trump administration on its own ground, as theater of the absurd.  Fallon caught a lot of heat for hosting Trump pre-election and ruffling his hair, but his ratings have held steady.  Most notable, however, is Jimmy Kimmel, who delivered a heartfelt monologue about his infant son’s life-saving surgery and, in the run-up to the vote on repealing ObamaCare, the importance of preserving it.

“ ‘If your baby is going to die, and it doesn’t have to, it shouldn’t matter how much money you make,’ Kimmel said.  ‘I think that’s something, whether you’re a Republican or Democrat or something else, we all agree on that, right?’

“It was human, humble and, most importantly, effective.

“By Friday, physician and Republican Sen. Bill Cassidy of Louisiana said any new health-care legislation should ‘pass the Jimmy Kimmel test.’  That, Colbert and his ilk should note, is how you begin to move the needle.”

--I do not involve myself in state politics, certainly not nearly to the extent that I try to keep up with the global scene more than what’s going on in New Jersey for the most part, but with our state primary coming up, I can’t help but note I met GOP gubernatorial candidate Jack Ciatarrelli at a small gathering last weekend in New Providence and I liked the guy.  So I’m on board, voting for him come June 6.

I was also talking to a former state prosecutor who I respect a lot and he totally trashed Kim Guadagno, the current GOP favorite to replace Chris Christie, as the two had worked together for a spell.

--According to the New York Post’s Page Six, “Sandra Lee refused to let House Speaker Paul Ryan join her cooking segment on Fox News and told him, ‘I need you to go away.’”

You see, Ms. Lee, longtime girlfriend of Gov. Andrew Cuomo, a Democrat, was not happy her segment on Tuesday’s “Fox & Friends’ would directly follow an interview with Speaker Ryan.

So the hosts asked Ryan to stick around for Lee’s bit so he could try the food, but in the break before her demo, “she said to Ryan and some others there, ‘I need you to go away so I can collect my thoughts, prepare, and get ready for the segment.’”

And so Sandra Lee is thrown in the December file for “Jerk of the Year” consideration. 

---

Pray for the men and women of the armed forces...and all the fallen.

God bless America.

---

Gold $1227
Oil $47.82

Returns for the week 5/8-5/12

Dow Jones  -0.5%  [20896]
S&P 500  -0.4%  [2390]
S&P MidCap  -1.1%
Russell 2000  -1.0%
Nasdaq  +0.3%  [6121]

Returns for the period 1/1/17-5/12/17

Dow Jones  +5.7%
S&P 500  +6.8%
S&P MidCap  +3.5%
Russell 2000  +1.9%
Nasdaq  +13.7%

Bulls 58.7
Bears 17.3 [Source: Investors Intelligence]

Have a great week.

Brian Trumbore



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Week in Review

05/13/2017

For the week 5/8-5/12

[Posted 5:00 a.m. ET, Saturday, from somewhere on the Jersey Shore....]

Note: StocksandNews has significant ongoing costs and your support is greatly appreciated.  Click on the gofundme link or send a check to PO Box 990, New Providence, NJ 07974.  *Special thanks to long-time friend Brad K.

Edition 944

Trump World....the Comey firing and the blowback....

Due to the fact I have basically been out of touch since early Friday afternoon, it’s impossible for me to tie everything together as I normally attempt to do given another hectic Friday in Trump World. 

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Monday, former Acting Attorney General Sally Yates, appearing before a Senate Judiciary subcommittee, recounted in detail her unusual visit in January to White House Counsel Donald McGahn, warning him that the Justice Department had evidence former National Security Adviser Michael Flynn had lied to White House officials and the public about certain “problematic” conduct, though in a Senate hearing, she declined to specify the conduct, though from leaks it seems to involve Flynn discussing sanctions on Russia with the Russian ambassador.

We also learned Monday that President Obama had warned Trump not to hire Mr. Flynn.

Separately, both Ms. Yates and former Director of National Intelligence James Clapper admitted that while in office they had personally reviewed classified reports about “Mr. Trump, his officials or members of Congress” who had been “unmasked.”

Editorial / Wall Street Journal

“We thought readers might like to know those details in case they go unreported anywhere else in the press.  The unmasking of the names of political opponents is a serious concern, and the American people need to know how and why that happened here.”

Late Tuesday afternoon, President Trump stunned the nation in firing FBI Director James Comey, with the case against the Director of Intelligence, now laid out in a letter by Deputy Attorney General Rod Rosenstein, who said he “cannot defend” how Comey had treated Hillary Clinton during the investigation into her emails.

President Trump then had the following letter delivered to the FBI....

Dear Director Comey:

“I have received the attached letters from the Attorney General and Deputy Attorney General of the United States recommending your dismissal as the Director of the Federal Bureau of Investigation.  I have accepted their recommendation and you are hereby terminated and removed from office, effective immediately.

“While I greatly appreciate you informing me, on three separate occasions, that I am not under investigation, I nevertheless concur with the judgment of the Department of Justice that you are not able to effectively lead the Bureau.

“It is essential that we find new leadership for the FBI that restores public trust and confidence in its vital law enforcement mission.”

Immediately, Democrats had a field day, with Senate Minority Leader Charles Schumer (N.Y.) saying at a news conference, “Are people going to suspect cover-up? Absolutely.”

Other Democratic senators described Trump’s move as “Nixonian” and there were renewed calls for a special prosecutor.

CNN legal analyst Jeffrey Toobin described Trump’s decision as a “grotesque abuse of power.”

Just one week earlier, Trump had tweeted: “FBI Director Comey was the best thing that ever happened to Hillary Clinton in that he gave her a free pass for many bad deeds!”

Among the comments from GOP senators:

Sen. Richard Burr (N.C.): In a statement he said that he was “troubled by the timing and reasoning of Director Comey’s termination.”

Sen. Bob Corker (Tenn.): “While the case for removal of FBI Director James Comey laid out by Deputy Attorney General Rod J. Rosenstein was thorough, his removal at this particular time will raise questions.”

Sen. John McCain (Ariz.): “While the President has the legal authority to remove the Director of the FBI, I am disappointed in the President’s decision to remove James Comey from office.”

[McCain added Tuesday night that when it comes to the Russian investigation, “I guarantee you there will be more shoes to drop, I can just guarantee it.  There’s just too much information that we don’t have that will be coming out.”]

Sen. Ben Sasse (Neb.): In a statement, “Regardless of how you think Director Comey handled the unprecedented complexities of the 2016 election cycle, the timing of this firing is very troubling... I have reached out to the Deputy Attorney General for clarity on his rationale for recommending this action.”

But other GOP senators disagreed with their above colleagues:

Sen. John Cornyn (Texas): The Senate’s No. 2 Republican told reporters that “obviously he’s been the center of controversy both among Democrats and Republicans at different times.”

Sen. Ted Cruz (Texas): In a statement, “Unfortunately, Mr. Comey had lost the confidence of both Republicans and Democrats, and, frankly, the American people.”

Sen. Lindsey Graham (S.C.): In a statement, “Given the recent controversies surrounding the director, I believe a fresh start will serve the FBI and the nation well.”

Sen. James Lankford (Okla.): In a statement, “It is unfortunate that over the past year the Director had lost the trust of so many people on both sides of the aisle.”  [The Hill]

White House officials used the Rosenstein letter as the key piece of evidence to justify Comey’s firing.  But then the White House said Comey’s dismissal came at the recommendation of both Attorney General Jeff Sessions and Rosenstein, though the AG, Sessions, had recused himself from the investigation into Russia interference in the presidential election, because of his failure to disclose a meeting with Russian Ambassador Kisylak. 

It was Session’s decision to step down on this matter that put Rosenstein in charge of the specific case.

The actual Russia investigation will continue under the supervision of acting FBI Director Andrew McCabe, a 20-year veteran of the bureau.  But the White House announced the search for a new director would begin immediately.

Separately, but related, White House Spokesman Sean Spicer could be out of a job due to an ‘embarrassing’ briefing on Tuesday.  Spicer was seen by multiple reporters hiding behind bushes at the White House until TV cameramen turned out their lights and agreed not to take video of the briefing Spicer then gave.

But then Spicer delivered a “cringe-worthy performance,” as described by the Washington Post, failing to offer a clear timetable or rationale for Trump’s abrupt decision to fire Comey.

“Just turn the lights off. Turn the lights off!” Spicer shouted, according to the Post.  Spicer then gave a very confused explanation of how Comey’s firing went down, blaming Rosenstein, then backing off.

Wednesday afternoon, Trump defended sacking Comey, arguing the former director “was not doing a good job.”

Reports emerged that Comey had requested more money and personnel for the FBI’s probe of Russian meddling in the 2016 election, though the veracity of this was called into question.

Comey reportedly made the request during a meeting last week with Rosenstein, but the department’s top spokeswoman, Sarah Isgur Flores, said these reports are “totally false.”

[Thursday, in the hearing before the Senate Intelligence Committee, acting FBI Director McCabe also said the FBI had not requested more resources and that they had what they needed to proceed.]

Wednesday evening, Comey sent a letter to agents and friends following his firing.

“I have long believed that a President can fire an FBI director for any reason, or for no reason at all.  I’m not going to spend time on the decision or the way it was executed.

“I hope you won’t either.  It is done, and I will be fine, although I will miss you and the mission deeply.”

Comey added that the FBI must continue “the mission of protecting the American people and upholding the Constitution.”

I believe a New York Times report by Maggie Haberman and Glenn Thrush from Wednesday that Trump had openly been talking about firing Comey for at least a week, and “the grumbling evolved into a tentative plan as he angrily watched the Sunday news shows at his Bedminster, N.J., golf resort.”  According to the report, though, Stephen Bannon, while sharply critical of the FBI, “questioned whether the time was right to dismiss Mr. Comey, arguing that doing it later would lessen the backlash.”

A Wall Street Journal story from Wednesday by Shane Harris and Carol E. Lee notes that “Mr. Comey became increasingly occupied with the (Russia) probe...

“Mr. Comey was concerned by information showing possible evidence of collusion, according (to people with knowledge of the matter and the progress of the FBI investigation).”

Thursday, in an interview with NBC News’ Lester Holt, Trump said he was thinking of “this Russia thing with Trump” when he decided to fire Comey.  Trump told Holt: “In fact, when I decided to just do it, I said to myself, ‘You know, this Russia thing with Trump and Russia is a made up story, it’s an excuse by the Democrats for having lost an election that they should have won.’”

This account flatly contradicted the White House’s initial account of how Trump arrived at his decision.

Trump also said in the interview that he had no intention of hindering the FBI’s Russia probe and that he wants the investigation “to be absolutely done properly.”

“I want that to be so strong and so good...I want to get to the bottom. If Russia hacked, if Russia did anything having to do with our election, I want to know about it.”

Trump denigrated Comey as “a showboat” and “a grandstander.”

So initially Trump aides said the president fired Comey simply because it was the recommendation of Attorney General Jeff Sessions and Deputy Attorney General Rod Rosenstein, the latter writing the memorandum detailing Comey’s handling of the investigation into Hillary Clinton’s private email server while secretary of state.

The official version also wanted us to believe Trump’s decision was not shaped by the ongoing probe, even though days before he had publicly called the inquiry, by the FBI as well as the Senate and House, “a total hoax” and “a taxpayer charade.”

But Thursday, Trump told Holt, “I was going to fire Comey....I was going to fire regardless of the recommendation.”

Trump also talked of a dinner he had with Comey at the White House, where “at that time he told me, ‘You are not under investigation.’”

Trump told Holt that three times Comey told him this; once at the dinner and the other two times over phone calls.

Yet this would mean the FBI director was discussing an ongoing investigation with the president – which Justice Department policy prohibits, though it was not legally wrong for Trump to ask the director if he was being investigated.

But you’d be hard-pressed to find anyone who believes the president’s account.  Comey’s temporary replacement, Andrew McCabe, told senators at a hearing Thursday morning that no White House officials had tried to interfere with the Russia probe.

As for Deputy AG Rosenstein, there were conflicting reports as to how upset he was over the coverage of the firing and how it was initially pinned on his memo, not just by White House spokespeople on Tuesday, but then Vice President Mike Pence on Wednesday, who repeatedly pointed to Rosenstein’s letter while describing the president’s decision.

Then on Friday, President Trump issued a veiled threat to Comey, as part of a morning tweetstorm.

“James Comey better hope that there are no ‘tapes’ of our conversations before he starts leaking to the press!”

It was unclear if Trump was suggesting he had recorded their conversations. 

The president wants us to focus on the positives in his first four months, but he likes to step on his own message.

Opinion....

Kimberley A. Strassel / Wall Street Journal

“Testifying last week before the Senate Judiciary Committee, James Comey recalled a moment that should have held more significance for him than it did. At the height of the presidential campaign, President Obama’s attorney general, Loretta Lynch, had chosen to meet with Bill Clinton on an airport tarmac.  That, said the now-former FBI director, ‘was the capper for me.’  Hillary Clinton’s emails were being probed, but Ms. Lynch was too conflicted to ‘credibly complete the investigation.’  So Mr. Comey stepped in.

“Donald Trump and senior Justice Department leaders might appreciate the impulse. According to Democrats and the media, Attorney General Jeff Sessions is too conflicted to recommend sacking Mr. Comey; the Trump administration is too conflicted to name a successor; the entire Justice Department and the Republican Congress are too conflicted to conduct true oversight.

“Entirely missing from this narrative is the man who was perhaps the most conflicted of all: James Comey.  The FBI head was so good at portraying himself as Washington’s last Boy Scout – the only person who ever did the right thing – that few noticed his repeated refusal to do the right thing.  Mr. Comey might still have a job if, on any number of occasions, he’d acknowledged his own conflicts and stepped back.

“Deputy Attorney General Rod Rosenstein’s memo to Mr. Sessions expertly excoriated Mr. Comey’s decision to ‘usurp’ Ms. Lynch’s authority and his ‘gratuitously’ fulsome July press conference.  But Mr. Comey’s dereliction of duty preceded that – by his own admission.  Remember, he testified that the Lynch-Clinton meeting was but the ‘capper.’  Before that, he told lawmakers, ‘a number of things had gone on which I can’t talk about yet that made me worry the department leadership could not credibly complete the investigation.’

“We don’t know what these things were, but it seems the head of the FBI had lost confidence – even before TarmacGate – that the Justice Department was playing it anywhere near straight in the Clinton probe.  So what should an honor-bound FBI director do in such a conflicted situation?  Call it out.  Demand that Ms. Lynch recuse herself and insist on an appropriate process to ensure public confidence.  Resign, if need be. Instead Mr. Comey waited until the situation had become a crisis, and then he ignored all protocol to make himself investigator, attorney, judge and jury.

“By the end of that 15-minute July press conference, Mr. Comey had infuriated both Republicans and Democrats, who were now universally convinced he was playing politics.  He’d undermined his and his agency’s integrity.  No matter his motives, an honor-bound director would have acknowledged that his decision jeopardized his ability to continue effectively leading the agency. He would have chosen in the following days – or at least after the election – to step down.  Mr. Comey didn’t....

“Colleagues describe Mr. Comey as an honorable man. The problem seems to be that his sense of perfect virtue made him blind to his own conflicts and the mess he had made.  New leadership at the FBI is a chance for a fresh start.”

Charles Krauthammer / Washington Post

“It was implausible that FBI Director James Comey was fired in May 2017 for actions committed in July 2016 – the rationale contained in the memo by Deputy Attorney General Rod Rosenstein.

“It was implausible that Comey was fired by President Trump for having been too tough on Hillary Clinton, as when, at a July news conference, Comey publicly recited her various email misdeeds despite recommending against prosecution.

“It was implausible that Trump fired Comey for, among other things, reopening the Clinton investigation 11 days before the election, something that at the time Trump praised as a sign of Comey’s ‘guts’ that had ‘brought back his reputation.’

“It was implausible that Trump, a man notorious for being swayed by close and loyal personal advisers, fired Comey on the recommendation of a sub-Cabinet official whom Trump hardly knew and who’d been on the job for all of two weeks.

“It was implausible that Trump found Rosenstein’s arguments so urgently persuasive that he acted immediately – so precipitously, in fact, that Comey learned of his own firing from TVs that happened to be playing behind him.

“These implausibilities were obvious within seconds of Comey’s firing and the administration’s immediate attempt to pin it all on the Rosenstein memo. That was pure spin. So why in reality did Trump fire Comey?

“Admittedly, Comey had to go.  The cliché is that if you’ve infuriated both sides, it means you must be doing something right.  Sometimes, however, it means you must be doing everything wrong.

“Over the past year, Comey has been repeatedly wrong.  Not, in my view, out of malice or partisanship (although his self-righteousness about his own probity does occasionally grate).  He was in an unprecedented situation with unpalatable choices  never in American presidential history had a major party nominated a candidate under official FBI investigation....

“Comey had to make up the rules as he went along.  He did.  That was not his downfall.  His downfall was making up contradictory, illogical rules, such as the July 5 non-indictment indictment of Clinton....

“There was ample bipartisan sentiment for letting Comey go. And there was ample time from Election Day on to do so.  A simple talk, a gold watch, a friendly farewell, a Comey resignation to allow the new president to pick the new director. No fanfare, no rancor....

“Instead we got this – a political ax murder, brutal even by Washington standards...No final meeting, no letter of resignation, no presidential thanks, no cordial parting....

“Why?  Trump had become increasingly agitated with the Russia-election investigation and Comey’s very public part in it.  If Trump thought this would kill the inquiry and the story, or perhaps even just derail it somewhat, he’s made the blunder of the decade.  Whacking Comey has brought more critical attention to the Russia story than anything imaginable.  It won’t stop the FBI investigation. And the confirmation hearings for a successor will become a nationally televised forum for collusion allegations, which up till now have remained a scandal in search of a crime.

“So why did he do it? Now we know: The king asked whether no one would rid him of this troublesome priest, and got so impatient he did it himself.”

Michael Goodwin / New York Post

“The president didn’t have just one good reason to act. He had a choice among many.

“The one he cited, Comey’s handling of the investigation into Hillary Clinton’s private server, is rich with irony, given its prominence in the campaign.  And the irony doesn’t stop, with Democrats who not so long ago were furious with Comey over the Clinton probe rushing out condemnations of Trump for firing him.

“ ‘Nixonian’ was a common theme, a shot both cheap and predictable. When you’re a hammer, everything is a nail.  When you’re a Democrat, everything is Watergate.

Bret Stephens / New York Times

“With Donald Trump, the tells are always easy.

“When the president says, ‘I’m, like, a smart person,’ you know he nurses deep insecurities about his intelligence. When he says, ‘I’m really rich,’ you know that he knows that you know that, really, he probably isn’t.

“And when he writes, as he did in his letter to the now-former FBI director, James B. Comey, that ‘while I greatly appreciate you informing me, on three separate occasions, that I am not under investigation,’ you know what keeps him up at night, too....

“In all this, the riddle wrapped in a mystery inside an enigma is Russia.

“Golf courses: Russia.  Mike Flynn’s lies to the vice president: Russia.  Jeff Sessions’ lies to the Senate: Russia.  Paul Manafort, Carter Page and Roger Stone: Russia.  WikiLeaks: Russia.  Donald Trump Jr.: Russia. The Bayrock Group: Russia.  Erik Prince’s diplomatic back channel: Russia.

“No one piece in this (partial) list is incriminating. And with Trump, the line between incompetence and nefariousness, misjudgment and misdirection, is usually a blurry one.

“Still, Jim Comey’s firing now brings two points into high relief. First, the administration is not being truthful when it claims the director was dismissed for what he did last summer.  Second, Donald Trump is afraid. A president who seeks to hide a scandal may be willing to risk an uproar.”

ObamaCare

Appearing on ABC’s “This Week” with George Stephanopoulos, House Speaker Paul Ryan said some of the following on Republican efforts to repeal and replace ObamaCare:

“(Let’s remember) what is happening right now.  ObamaCare is collapsing. ObamaCare isn’t working.  What good is ObamaCare for anybody, let alone for a person with preexisting conditions if you don’t have a health insurance plan that you can even get.

“So this is a rescue mission to make sure that we can achieve the goals we all want, which is getting the cost of coverage down and making sure that everyone has access to affordable health care, especially and including people with pre-existing conditions. That is what our bill does.

“So let me just say a couple of things.  You have got all of these health insurers. If they were doing so well, why would they be pulling out of the marketplace?  Over 1,000 counties, one in three counties in America, have one plan to choose from.

“Just this week in Iowa, their last statewide insurer said that they were going to have to pull out. So that means people in 94 of Iowa’s 99 counties will have zero choices.  Aetna just pulled out of Virginia. The law is collapsing. It’s not working.

“You can’t get health insurance in these places, whether you have a pre-existing condition or not. And so what we’re trying to do here, George, is step in front of this collapsing law and make sure that we can have a system that works, a system with choice and competition and affordable premiums....

“Under this bill, no matter what, you cannot be denied coverage if you have a pre-existing condition.  And under this bill, you cannot only not be denied coverage...you can’t be charged higher....You can’t charge people more if they keep continuous coverage.  The key of having a continuous coverage provision is to make sure that people stay covered and they move from one plan to the next if they want to....

“ObamaCare, the premiums are going up double digits. The deductibles are sky high. And choices are evaporating to the point where one in three counties in America have one insurer left. And now we’re learning those last insurers in many states are pulling out.

“So this is a crisis. We are trying to prevent this crisis. And we think we have better ideas.  And by the way, in Wisconsin, we had a good system. In Maine, they had a good system. Let the states – because states are different from one another, let the states perfect this while making sure we have multiple layers of protections for people with pre-existing conditions.”

Editorial / Wall Street Journal

“For all the media think pieces about the nature of truth in the Trump era, Democrats have their own alternative facts about ObamaCare.  To undermine the GOP case for repeal and replace, they claim the entitlement is working beautifully. But then what about the latest insurance giant to dump its ObamaCare ballast?

“Aetna said on Wednesday that it will withdraw individual market plans in Nebraska and Delaware, meaning it will participate in zero exchanges in 2018.  Last week the insurer bolted from Iowa and Virginia, and the four states were the last vestiges of its original ObamaCare expansion to 15 states. Even as the rest of its business is performing handsomely, Aetna expects to lose about $200 million on ObamaCare this year, on top of writedowns nearing $700 million between 2014 and 2016.

“Humana has also left the exchanges altogether, Anthem is edgy, and the familiar problem is ObamaCare’s structural undertow.  Despite subsidies and mandates, the regulations are too restrictive and insurers aren’t allowed to profitably sell products that can attract enough people to square the economies.

“The white flag is especially notable because Aetna led ObamaCare’s industry cheering section in 2009 and 2010 and was once inclined to accept the exchanges as temporary loss leaders to support the mission of universal coverage.  In the chaos of the law’s early years, liberals insisted everything would be fine by now.

“In a hilarious letter Tuesday, all 48 Senate Democrats instructed Republicans ‘to discourage the ongoing effort by the Administration to destabilize the health-care marketplace, which could lead to rising insurance premiums for all.’  Could?  ObamaCare is already doing a fine job of raising costs and reducing choices....

“The GOP’s American Health Care Act includes tools that can mitigate some of the damage, and over time nurture a richer, more liquid insurance market.  The failure to pass the reform this spring has contributed to business uncertainty, but there’s still time to provide more stability – though it is running out fast.

“If Congress can’t find a reform majority, then Democrats will flip their all-is-well narrative without a second thought and blame Republicans for every last horror story. The GOP will have no answer heading into the midterms.

“Over the longer term, a Republican failure to stand up a market-based ObamaCare replacement means the status quo of ever-more government, and there’s another warning in the Aetna news: In the first quarter, revenue from taxpayers exceeded revenue from its commercial business for the first time since the company was founded in 1853.”

Last weekend, Texas Republican Sen. Ted Cruz acknowledged that Senate Republicans face an uphill battle to pass an ObamaCare repeal bill, warning that a failure to do so would be “catastrophic.”

Wall Street

On the economic front, there was some important inflation data for April.  Producer prices rose a higher-than-expected 0.5%, 0.4% ex-food and energy.  For the 12 months, the PPI is up a strong 2.5%, 1.9% on core.

Consumer prices rose 0.2%, in line, and 0.1% on core.  For the 12 months, the CPI is up 2.2%, though this is down from March’s 2.4% level.  The April core figure year-over-year is 1.9%.

Add it up and inflation is at the Federal Reserve’s target 2% for both PPI and CPI, which certainly adds credence to those calling for another rate hike at the June 13-14 meeting.

One other...April retail sales were up a solid 0.4%, which while a little below expectations, was essentially up across all categories.

Europe and Asia...French Election....

Not a lot of broad-based economic news out of the eurozone, with the European Commission revising upward its forecasts of EA19 growth this year to 1.7%, up from 1.6%, and 1.8% in 2018.

Aside from the risks over Brexit, the EC noted other possible drags could be caused by uncertainties surrounding U.S. economic and trade policy, China’s economy and broader geopolitical tensions.

The EC says inflation will only be 1.6% this year and then 1.3% next.

On to the French Election: Emmanuel Macron became France’s youngest leader since Napoleon Bonaparte as the 39-year-old whipped the far-right’s Marine Le Pen, 66.1% to 33.9% on Sunday.  The French polls were darn good going back over a year, consistently showing that if Le Pen did make it into a run-off, she’d lose badly.  But there was also a 25% abstention rate, the highest this century, with another 9% casting blank or spoiled ballots.

Macron’s story is a remarkable one, the 39-year-old never having stood for elected office before and starting his political party just a year ago.  Monday he changed the name of it from En Marche to La Republique En Marche (Republic on the Move).

The next step for him was to pick candidates to run on the ticket in parliamentary elections on June 11 and 18.  Macron wants/needs a governing majority and he has no seats as of today.

Thursday, Macron’s party announced a list of 428 candidates, a partial list as En Marche previously said it would stand for every one of the National Assembly’s 577 seats.  Macron did fulfil a campaign promise to have women represent one half of his candidates, while over half come from civil society.  The party secretary said that with regards to the remaining available slots, they wanted to leave the door open for politicians of other parties to come over to Macron’s side.

Polls show Macron’s party picking up 24%-26% of the vote in the first round June 11, while the Republicans (Conservatives) and National Front would win about 22%, and the far-left France Unbowed 13%-15%.  The Socialists, still suffering from Francois Hollande’s dismal approval ratings, bring up the rear.

All of this means Macron is going to have to do some wheeling-dealing to gain some kind of majority to work with.

Macron also faces a deeply divided country, and he’s the first from outside the two main political parties in the country since the founding of the modern republic in 1958.  “I know the divisions in our nation,” he said in his victory remarks on Sunday, “which led some to vote for extremist parties.  I respect them.  I will work to recreate the link between Europe and its peoples, between Europe and its citizens.”

Needless to say, European leaders were thrilled by Macron’s victory.  Jean-Claude Juncker, the president of the European Commission, told him: “I am delighted that the ideas you defended of a strong and progressive Europe, which protects all its citizens, will be those that you will carry into your presidency.”

President Trump tweeted his congratulations and then called Macron the next day to say he looked forward to working with him.

As for Marine Le Pen and her National Front party (FN), she signaled there will be changes, following the parliamentary elections, with a probable name change as she vows to lead the “new force” into an era where it represents the true opposition in France; the “patriots” against the “globalists,” as she put it.

But she needs seats in parliament, and of the 577 up for grabs, today the FN has only two and most prognosticators have the party increasing this total to just between 15 and 25.

To close the circle on the election, though, I do have to add that the National Front did rack up its biggest vote tally ever at more than 10 million, and while her 34% fell short of some expectations, it was essentially double the 18% Le Pen’s father, Jean-Marie, picked up in his run-off in 2002 against Jacques Chirac.

Marine Le Pen’s leadership of the FN is not in doubt, yet.  Her niece, Marion Marechal-Le Pen, a National Front lawmaker, has a bright future but she is only 27.  After 2022, though, Marion could take over.  She was critical of Marine at times and how she ran her campaign, including her stance on the euro which definitely hurt.  Marion said on France 2 television: “There are clearly lessons to be learned.  We clearly didn’t manage to get this election to be understood as a referendum for or against France, a referendum for or against immigration...for or against the European Union as we know it.”

Lastly, it could yet be a long summer in France.  Far-left leader Jean-Luc Melenchon said Macron was planning a war on the French social system and called on his voters to mobilize against the ex-banker in the June elections.

Since 1999, successive French presidents have sought to undo items such as the 35-hour workweek law, but protests from the likes of Melenchon have done them in.  He is once again promising chaos if Macron attempts to change too much.

Eurobits....

--The yield on Greek bonds fell to their lowest level since a private sector bond restructuring five years ago, as investors are betting on a bailout breakthrough this spring, buoying the economy.  The 10-year bond peaked at 27% in June 2012, the height of the financial crisis, and this week fell to 5.50%, which is pretty staggering.  Some very smart people made a lot of money with this trade.  [If memory serves me right, David Tepper being among them.]

--Germany’s GDP rose 0.6% in the first quarter, better than the fourth quarter’s 0.4% pace, which will help buoy Chancellor Angela Merkel’s re-election hopes with September federal elections looming.  Year-over-year growth was 1.7% in Q1.

Speaking of Merkel’s re-election campaign, her conservatives won a big victory over their Social Democrat rivals in a vote last weekend in the northern state of Schleswig-Holstein, which bodes well for her in September.  Merkel’s Christian Democrats (CDU) took 33% of the vote, up from 30.8% the last election there, while the Social Democrats (SPD) won 26%, down from 30.4%.

After former European Parliament president Martin Schulz announced in January he would run against Merkel, the SPD surged in the polls, but now they have plateaued.

Meanwhile, the anti-immigrant Alternative for Germany (AfD) continues to lose support and scored only 5.5% in the state vote.

--Bank of England Governor Mark Carney warned that U.K. households face a difficult year, which is why the BOE continues to keep interest rates on hold.

Carney believes the U.K.’s departure from the European Union will be smooth, but consumers are impacted by the uncertainties in the process, plus real wage growth remains weak.

“This is going to be a more challenging time for households,” Carney said at a press conference on Thursday.  “Wages won’t keep up with prices for goods and services they consume.”

Officials cut their forecast for growth this year to 1.9%, while inflation is projected to be 2.7%, owing to a weaker pound.

We have a lull in the Brexit talk until the U.K.’s vote on June 8, after which formal negotiations will commence...and then it’s going to be one sound bite after another for 18 months or thereabouts.

Turning to Asia, China reported exports rose less than expected in April, up 8% year-over-year, while imports were up 11.9%.  March exports had risen 16.4%.

Total April auto sales in China fell 2.2% vs. a year ago, according to the Chinese Automobile Manufacturers Association, while passenger vehicle sales declined 3.7%, the biggest fall since July 2015.  But for the first four months, vehicle sales remain 4.6% higher.  That said, 2016 was a record year in both the U.S. and China and no doubt demand is slowing.

Toyota Motor Corp.’s China sales increased 7.2% in April, with sales for the first four months up 3.1%, the company said.

Ford Motor Co. said April sales were up 11%, but were down 12% for the first four months.

General Motors saw its sales fall 1.9% in April, with year-to-date down 4.5%.

Volkswagen AG reported a 4.3% increase last month, but sales are down 1.9% for the year.

Separately, China’s April power consumption rose 6% from a year earlier, according to the energy bureau, while from January to April, power consumption increased 6.7%.

But there was a big announcement on Thursday, Friday in China, as the U.S. and China reached an important trade deal that opens the Chinese market to U.S. credit rating agencies and credit card companies, plus China is lifting the ban on U.S. beef imports and will accept U.S. shipments of liquefied natural gas.

In return, Americans can eat cooked chicken from China and Chinese banks can enter the U.S. market, the latter a big deal for China’s image.  No longer are you hearing words from the White House such as “currency manipulator” or “unfair trade partner.”

This is also huge for the U.S. cattle industry.  I like it.  As for Chinese chickens, well...I’m going to stick with Perdue, thank you very much.  But China will certainly have a captive audience here.

I didn’t get a chance to read the formal statement accompanying the deal, but the U.S. also recognized the importance of China’s One Belt and One Road initiatives in Southeast Asia.

Street Bytes

--Stocks were mixed as Nasdaq hit new highs, up 0.3% on the week, while the Dow Jones and S&P 500 fell a bit, -0.5% and -0.3%, respectively.

--U.S. Treasury Yields

6-mo. 1.01%  2-yr. 1.29%  10-yr. 2.33%  30-yr. 2.99%

--Shares in Apple climbed this week following news Warren Buffett’s Berkshire Hathaway has been buying up more shares, taking the stake to more than $19bn, up from $7.1bn at the end of 2016.  Apple’s market value crossed $800bn for the first time.

--The retail sector got slammed anew, specifically the department store crowd, as Macy’s shares cratered nearly 18% on Thursday after it reported same-store sales fell 5.2%, steeper than the 3% analysts had forecast.  This came on top of a 6.1% drop in the year ago period.  [I like Macy’s, but I can’t imagine how the store employees come to work every day.  Many of their friends are gone.  They see falling traffic.  Depressing.]

Net sales fell nearly 8% from a year ago to $5.34bn, also shy of expectations.

And profits fell to $70m for the three months to April 29, down from $116m a year ago.

Macy’s reiterated its forecast for comp sales for fiscal 2017, down 2-3%.

Discount department store Kohl’s reported its fifth straight quarter of falling same-store sales, even after a tie-up with Under Armour to sell their athletic apparel in its 1,160 stores.  Comp sales fell 2.7%, far more than expected.

Revenue declined 3.2% to $3.84bn, also short of the Street.  Earnings did beat, but the shares fell 8%.

The company didn’t provide specifics on how sales of Under Armour products are doing in their stores.

Then on Friday, shares in Nordstrom and JC Penney both cratered 10-12%, as the former reported comp-store sales for the quarter that were down 0.8%, while JC Penney’s fell a larger than expected 3.5%.

--Shares in Snap Inc. cratered over 20% after the company’s first earnings report and conference call as a public company.  Snap announced it added 8 million daily active users in the period, for a total of 166 million, with growth from a year earlier slowing to 36 percent.  First-quarter revenue of $149.6 million also missed the $158.6 million average analyst estimate, though this was up 286% from last year’s first quarter, but down from the fourth quarter’s $166 million.

CEO and co-founder Evan Spiegel dismissed concerns over the company’s performance, “If you want to be a creative company, you have got to be comfortable and enjoy the fact that people copy your products if you make great stuff,” he said, referring to Facebook’s copying of some of Snapchat’s most popular features, including its tool for short videos, “stories.”

The drop in the shares meant Spiegel and co-founder Bobby Murphy lost about $1 billion on paper.

Spiegel would provide no financial guidance, nor discuss future products, saying, “We’re kind of famous for not giving guidance on the product pipeline.”

Spiegel has insisted that the speed at which Snapchat adds users is dependent on how soon high-speed cell service arrives in the developing world and how quickly the company launches new features.

--Walt Disney Co. reported revenue growth of 3% for the three months ended April 1, to $13.34 billion, and an 11% increase in net income to $2.39 billion compared with the same period a year earlier.  The net income per share beat expectations, while revenue fell short.

But CEO Robert Iger on Tuesday’s conference call had to spend much of his time once again discussing the fate of ESPN, which has lost momentum in recent years while other divisions at Disney boom.  ESPN recently laid off about 100 of its 8,000 employees, in the latest round of cost-cutting, as viewership for non-live sports, including its signature SportsCenter program, decline.

Over the past five years, ESPN has gone from 99 million subscribers to 87.44 million, according to Nielsen. Disney is planning a new, ESPN-branded stand-alone streaming service.

Meanwhile, Disney’s theme-parks unit saw revenues increase 9% to $4.3 billion, with a 20% increase in operating income to $750 million.  Attendance at domestic parks was up 4%, while Shanghai Disney Resort, which opened last June, was profitable for the first time last quarter.

Despite comparisons to last year when “Star Wars: The Force Awakens” was in theaters, the movie studio reported revenue was down only 1% to $2.03 billion, with operating income up 21% to $656 million.  March’s “Beauty and the Beast” was a huge hit, taking in more than $1.1 billion.

--The Peanuts gang was sold by Iconix Brand Group, a licensing firm, to DHX Media of Halifax for $345 million.  DHX owns various kids entertainment properties.

Iconix is exiting the entertainment business and made a nice profit on its 80 percent stake in Peanuts, which it acquired in 2010 for $175 million.

--Shares in Wendy’s hit a 10-year high this week as the fast food company beat the Street on earnings. Same-store sales rose 1.6%, which was less than the comparable period a year ago, but represented Wendy’s 17th consecutive quarter of positive same-store growth which is darn good in today’s environment.

International sales rose 14% in the quarter.

--Adidas struck a deal worth $425 million to sell its TaylorMade, Adams Golf and Ashworth golf brands to U.S. private equity group KPS Capital Partners.

The world’s second largest sportswear group is exiting golf as it declines in popularity, Adidas is focusing on footwear and apparel.

--Time Inc., the owner of Time, People and Sports Illustrated, continues to flounder with steeper than expected losses and revenue declines in the first quarter.

Revenue fell 8% to $636m, with advertising sales falling 8% on a 21% drop in print ad revenue.  The company has been slashing expenses and is preparing further cost cuts.

Time Inc. cut its quarterly dividend to 4 cents from 19 cents, a move that it said would save $60m annually, to reduce leverage and free up cash for investments.

--Wells Fargo announced it was cutting another $2bn in costs by the end of 2019.  Wells plans to close about 450 branches in 2017 and 2018 as part of the plan, “reducing redundant locations” and “consolidating less ideally located branches.”

Don’t close my three, Wells Fargo!  [All strategically located for groceries, beer and the post office.  ‘Domestic,’ of course.]

--Twenty-First Century Fox disclosed it had incurred costs of $10 million “related to settlements of pending and potential litigations” during its fiscal third quarter in the aftermath of various sexual harassment allegations at Fox News.

In the nine months leading up to March 31, the company said it had incurred $45 million in costs related to similar allegations.

Meanwhile, on an analyst call, executives Lachlan and James Murdoch expressed their high expectations that regulators would approve the company’s $14.3 billion buyout of Sky, the British satellite TV giant.

On the ratings front, Rachel Maddow on MSNBC has started to win her 9:00 time slot by certain measures (like the 25-to-54 demo), while Tucker Carlson, who replaced Bill O’Reilly at 8 p.m., has seen his numbers fall after a strong start, down 13% year-to-year, though he still wins the slot overall.

Carlson has retained most of the key 25-to-54 age group, as reported by Nielsen.

Carlson is averaging 2.75 million viewers, down from 3.17 million during the same period in 2016; most of the losses being in the age 55 and up group.

But the advertisers have returned to the 8:00 hour.  [Stephen Battaglio / Los Angeles Times]

Fox broadcast network’s programming continues to present challenges.  The post-“American Idol” lineup has been a disappointment, including the reboot of “24,” which I personally loved.  “Empire” remains a hit, but relative ratings are plunging.

--Baltimore-based Sinclair Broadcast Group Inc. is acquiring Tribune Media and its 42 TV stations, giving the once low-profile company a powerful nationwide platform to potentially launch a right-leaning alternative to rival Fox News.

Sinclair already owns 139 stations in the U.S., the largest such owner, but it does not have any outlets in Los Angeles or New York, though with the Tribune acquisition, it would have a major footprint in the two largest markets, plus Chicago, with KTLA, WPIX in New York and WGN.

Tribune is the former parent company of the Los Angeles Times and Chicago Tribune, with the two spun off into a new company – now named Tronc Inc. – in 2014.

The deal is subject to FCC approval.

--Hertz shares fell sharply after the car-rental chain reported a quarterly loss of $223 million, compared with a loss of $52m in the year-ago period, wider than the Street forecast as the company continues with its turnaround efforts.

Total revenues fell 3 percent from a year ago to $1.92bn, shy of forecasts.

Prices of used cars have been dropping, while part of the company’s turnaround efforts include selling off its aging cars and revitalizing its fleet.  Plus, ride-sharing competition from the likes of Uber and Lyft doesn’t help.

--Telecom giant BT announced it would be shedding 4,000 jobs worldwide over the next two years and is stripping its CEO of his annual bonus.

The issue of bonuses, for the CEO, Gavin Patterson, and other execs, has to do with the costs involved in an accounting scandal at BT’s Italian unit, which had been overstating profits for years.

--Shares in Boeing fell after the company was forced to halt test flights of its new 737 MAX aircraft due to possible issues with the engine, which GE is involved in the manufacturing of.

The stoppage came just days before Boeing was due to make its first delivery of the aircraft to a customer, though Boeing said it was sticking with plans to begin MAX deliveries this month.

American Airlines and Southwest are among those who have placed orders, while earlier this year, Indian airline SpiceJet (which runs its aircraft on turmeric and peppercorn) placed an order for 205 new planes from Boeing that was said to be worth $22bn.

The MAX model is a more-efficient version of Boeing’s best-selling previous 737 model.

--Bloomberg reports that an April 27 freeze in Bordeaux, with temps below freezing, threatened to cause damages in excess of $1 billion to the French wine industry, which has already been losing global share in recent years.    Frost ravaged vineyards from Bordeaux to Burgundy to Champagne.

--John Brennan of USA TODAY had a piece on Atlantic City’s revival, yes, revival.

“Casinos are turning profits.  Plans were announced recently for a $375 million renovation and reopening of Trump Taj Mahal by Hard Rock Casino, and Stockton University just broke ground on a satellite campus.  A luxury apartment complex, the first to be built in decades, is under construction. The city’s credit rating has improved.”

This all comes after a decade when half the city’s casinos closed and 10,000 people lost their jobs.  A.C.’s finances were shot and the state took control in November.

The opening in 1978 of Resorts casino had spurred a revival that lasted through 2006, with casino revenues up every single year through 2006, but then came another downturn, especially after New York and Pennsylvania opened up rival operations, and Atlantic City’s casino revenues fell every year through 2015.  I know I haven’t been to A.C. since the early 2000s (and that was to see Don Rickles more than anything else).  Instead, I’ve been to a Sands casino in Bethlehem, Pa., a little over an hour from me, as opposed to a trek to A.C., which is over two hours.

By mid-summer, a project along the lines of the London Eye is scheduled to open at the Steel Pier, a 200-foot-high observation wheel with large climate-controlled gondolas.

Yes, crime and high unemployment remain in Atlantic City, but all the construction jobs coming in, plus permanent university jobs at the Stockton complex, have begun to stem the bleeding.

--We note the passing of Stanley Weston, inventor of the G.I. Joe action figure and a pioneer of the licensing business.  He was 84.

Weston was born in Brooklyn in 1933 and served in the Army shortly after the Korean War ended.  He returned to New York and took a job with advertising agency McCann Erickson, where he soon discovered a talent for the newfound licensing and merchandising industry, striking out on his own to found Weston Merchandising.

When Mattel’s Barbie dolls were introduced in 1960, Weston realized boys were an untapped market and so he conceived of the idea of a military action figure and in 1963 sold what would become G.I. Joe to Hasbro.  It was a runaway hit.

Later, Weston renamed his company Leisure Concepts, and represented the likes of Farrah Fawcett, Nintendo and the World Wrestling Federation, as well as TV shows including Alf and Welcome Back, Kotter.

In 1989, the inaugural class for the Licensing Industry Hall of Fame was announced and there was Stanley Weston, alongside Walt Disney, George Lucas and Jim Henson, among others.  [AdWeek]

Foreign Affairs

Iraq/Syria/Russia/Turkey/Iran: President Trump approved a plan to provide Syrian Kurds with heavy weaponry to aid in the battle to retake Raqqa from Islamic State, the Pentagon announced.

The Kurdish militia, YPG, contains the most experienced fighters among the U.S.-supported opposition, but Turkey has long objected, insisting that the YPG are linked with the Kurdistan Workers’ Party (PKK), which both Turkey and the U.S. view as a terrorist group.  Turkey has been battling the PKK for decades.

Turkey wants to stop the rebels from taking more territory in Syria.

President Erdogan is meeting with President Trump in Washington this coming week and the Kurds will be topic one, no doubt.

To placate Ankara, the United States is going to be sharing more intelligence with Turkey.

A big issue regarding Raqqa specifically is who controls the city once ISIS falls.  Certainly Turkey and its Syria Arab allies won’t stand for the Kurds holding onto it.

As for the establishment of “safe zones,” or what military officials are calling “de-escalation zones” in Syria that Russia, Iran and Turkey recently agreed to establish, the U.S. dismissed a Russian admonition that U.S. aircraft are barred from flying over them.

A State Department official said over the weekend, “The coalition will continue to strike ISIS targets in Syria...at the same relentless pace as it is proceeding now.”

It’s not known just how the topic was handled in discussions President Trump had with Russian Foreign Minister Lavrov this week.

Iran: The presidential election is next Friday, May 19.  This is going to be interesting.  Cleric Seyyed Raisi is the preferred candidate of Supreme Leader Khamenei, but some surveys have him trailing President Hassan Rouhani.  However, polling data is unreliable here.

There are six candidates and it doesn’t appear anyone will reach 50%, so this will necessitate a run-off one week later.

Separately, officials in both Iran and Saudi Arabia exchanged rather harsh words this week, starting with remarks by Saudi Deputy Crown Prince Mohammed bin Salman, who said that any struggle for influence between the Sunni Muslim kingdom and the revolutionary Shiite theocracy ought to take place “inside Iran, not in Saudi Arabia.”  To which Iranian Defense Minister Hossein Dehghan was quoted by an Iranian news agency as saying, “If the Saudis do anything ignorant, we will leave no area untouched except Mecca and Medina.”

Afghanistan: President Trump has been given recommendations for adding at least 3,000 more U.S. troops to the fight against the Taliban in Afghanistan by U.S. military leaders.  The request apparently also includes a request for additional NATO troops of 3,000-5,000.

There are 13,000 NATO troops currently in the country, with 8,400 of them being U.S.

Last weekend, the Taliban announced they had seized a district just a few kilometers from the northern city of Kunduz, with thousands of families forced to leave their homes.  They also apparently control the main road to the east of the city, which is a major supply route to Kabul.

President Trump is expected to make a decision on troop strength prior to a NATO summit on May 25.

Separately, U.S. and Afghan officials announced last weekend that U.S. and Afghan special forces took out the head of Islamic State in Afghanistan, Abdul Hasib, in an operation April 27

Israel: At a televised speech, Hizbullah leader Sayyed Hassan Nasrallah announced his militia was dismantling its positions along Lebanon’s eastern border with Syria, and that this area was now the “responsibility of the state,” with no need for Hizbullah’s presence.  He then said that any war with Israel could take place inside Israeli territory, but appeared to tamp down fears of an imminent conflict.

South Korea: The nation has a new leader, Moon Jae-in, who has already been sworn in after winning the special presidential election 24 hours earlier.

Moon’s inaugural was low-key, barely 10 minutes, as he told the nation that he wanted a more egalitarian society, while regarding North Korea, he said he would go to Pyongyang but only if the conditions were right – though Moon didn’t specify what the conditions might be.  Moon said he would “do everything I can to build peace on the Korean peninsula.”

Moon is known for his liberal views and he has vowed to unify a country divided by the corruption scandal that saw his predecessor, Park Geun-hye, impeached.

He also said he wanted to meet Donald Trump and signaled he was not anti-American.

Any tension between Washington and Seoul will come about over the Trump administration taking a hard line against Pyongyang, at the same time Moon favors negotiation.

Moon is the son of refugees from North Korea and served in South Korea’s special forces before becoming a human rights lawyer.  He is the first liberal leader of his country in about a decade.

Aside from dealing with North Korea, one of Moon’s biggest challenges will be enacting reforms to limit the power of big business, while balancing relations between the U.S. and China.

David Straub, a former director of Korean affairs at the State Department and a senior fellow at a think tank in South Korea, warned of “serious policy differences between the U.S. and South Korean presidents” over the North and related issues.  Straub added they could lead to “significantly increased popular dissatisfaction with the United States in South Korea.”  [New York Times]

One immediate issue to watch is the American missile defense system, THAAD, which has just been deployed in South Korea, Moon having previously said he wished he had the opportunity to weigh in on it before it was a fait accompli.  But it’s unlikely he will undo it, which would be bowing to China.

Final results on Tuesday’s vote show that Moon took 41.1%, while conservative candidate Hong Joon-pyo received 25.5%. A centrist garnered 21.4%.  There is no 50% run-off rule here.

I just have to add the 41.1% compares with an exit poll that showed 41.4%...pretty, pretty good.

Editorial / Wall Street Journal

“Mr. Moon’s desire to appease North Korea marks a return to the Sunshine Policy that failed in the mid-2000s when he was an aide to center-left President Roh Moo-hyun.  Mr. Moon wants to pursue reunification based on economic integration, offering a formal peace process if the North will give up its nuclear weapons. He also wants to reopen the Kaesong Industrial Zone, which provided the North with $100 million a year in hard currency until its closure in 2016.  This ignores Pyongyang’s long record of broken promises and its clear intention to reunify the Korean Peninsula on its terms using nuclear weapons as leverage. In recent weeks the North has detained two more U.S. citizens, a reminder that the regime treats engagement as an opportunity to take hostages.

“All of this will complicate the Trump Administration’s attempt to increase pressure on Pyongyang as the North develops nuclear missiles capable of hitting Seattle.  North Korea will try to drive a wedge between the U.S. and South Korea to re-establish its cash lifeline, and China may pressure Mr. Moon to reverse the South’s recent deployment of the THAAD missile-defense system.  But the only chance of ending the nuclear threat is a united front toward the North and its Beijing patrons.

“President Trump inadvertently assisted Mr. Moon’s election with his ill-timed demand that South Korea pay for THAAD, though his aides walked that back.  Mt. Trump has to work with Mr. Moon but he’ll have to be clear that the North now threatens the U.S. mainland as well as South Korea....

“Mr. Moon says the U.S.-Korea alliance will remain the cornerstone of his country’s security. That’s good to hear, but Mr. Trump will have to be clear that a return to appeasement is unacceptable.”

China: Beijing is further strengthening controls over the Internet, pledging to control search engines and online news portals.

This is part of President Xi Jinping’s policy of “cyber sovereignty,” with the ruling Communist Party playing the leading role in limiting and guiding online discussion.

This is on top of existing controls, including the blocking of Google and Facebook.

Russia: The White House said that in the meeting between President Trump and Russian Foreign Minister Sergei Lavrov, the issue of Russia’s alleged interference in the 2016 election was not substantively raised, just “referenced.”

Lavrov said after, “President Trump and I spoke about concrete things. Neither of us touched on this bacchanalia.”

Trump described his interaction with Lavrov as a “very, very good meeting” and that both sought to end the “horrible, horrible killing in Syria as soon as possible and everybody is working toward that end.”

Russian ambassador Sergey Kislyak was also present.

President Trump was apparently livid when photos of the three emerged on Russian web sites after.  Trump claims he didn’t know the photographer in the room was with TASS.

When asked by reporters if FBI Director Comey’s firing cast a shadow over their discussions, Lavrov dismissed the question.  “Was he fired?  You’re kidding, you’re kidding,” he said.

Russia has said it is working toward establishing a meeting between Trump and Vladimir Putin.

Separately, Russian opposition leader Navalny was allowed to leave the country for medical treatment, confirming he was in Barcelona, where he underwent an operation on his right eye, following an attack last month in Moscow.

Navalny said his vision “won’t be restored for a few months.”

Random Musings

--Presidential approval ratings:

Gallup tracking poll, 38% approval; Rasmussen tracking poll, 48%.  [As of Wednesday and Thursday, respectively.]

A May 10 Quinnipiac University national poll of American voters revealed some of the following:

President Trump’s job approval was just 36%, 58% disapproving.  That split was 40-56 on April 19.

Among Republicans it’s 82-13; 7-90 among Democrats.

Among Independents, which is what I really focus on, the approval/disapproval split is 29-63, when it was 38-56 April 19. To me this has a direct bearing on the tight congressional races that loom in just 18 months.

By a 61-33 margin, American voters don’t believe the president is honest.

By a 58-37, they do not approve of the way the media is covering Trump.

By a 71-22, voters disapprove of the way Republicans are doing their job in Congress.  They disapprove of the job Democrats are doing by a 58-34 margin.

--Last Sunday, President Barack Obama was given the 2017 John F. Kennedy Profile in Courage Award by the John F. Kennedy Library and Foundation.  In his 1957 book, “Profiles in Courage,” JFK profiled eight senators who took unpopular but ultimately good positions despite the political risk.  In his 30-minute speech, President Obama invoked the debate over the Affordable Care Act and called on members of Congress to protect those who are sick and vulnerable.

I read the entire speech on Time.com and I was sickened by the following:

“And so by the time the vote came up to pass the Affordable Care Act, these freshmen congressmen and women knew that they had to make a choice. That they had a chance to insure millions and prevent untold worry and suffering and bankruptcy, and even death, but that this same vote would likely cost them their new seats, perhaps end their political careers.

“And these men and women did the right thing. They did the hard thing.  Theirs was a profile in courage. Because of that vote, 20 million people got health insurance who didn’t have it before.

“And most of them – and most of them did lose their seats, but they were true to what President Kennedy defined in his book as a congressional profile in courage: the desire to maintain a reputation for integrity that is stronger than the desire to maintain office.  Because of that vote, 20 million people got health insurance who didn’t have it before....

“I hope that current members of Congress recall that it actually doesn’t take a lot of courage to aid those who are already powerful, already comfortable, already influential. But it does require some courage to champion the vulnerable and the sick and the infirm, those who often have no access to the corridors of power.

“I hope they understand that courage means not simply doing what is politically expedient but doing what they believe deep in their hearts is right. And this kind of courage is required from all of us....Those of us not in elected office have to show some courage. And we’re prone to bestow the mantel of courage too easily on the prominent and the powerful and then too eager to wrap ourselves in cynicism when they let us down because they weren’t perfect....

“John F. Kennedy knew that our best hope and our most powerful answer to our doubts and to our fears lies inside each of us, in our willingness to joyfully embrace our responsibility as citizens, to stay true to our allegiance, to our highest and best ideals, to maintain our regard and concern for the poor and the aging and the marginalized, to put our personal or party interest aside when duty to our country calls or when conscience demands.

“That’s the spirit that has brought America so far and that’s the spirit that will always carry us to better days.

“And I take this honor that you have bestowed on me here tonight as a reminder that, even out of office, I must do all that I can to advance the spirit of service that John F. Kennedy represents.”

I was sickened reading this passage because of Syria…a real failure in courage back in 2012, when there were ‘only’ 20,000 dead, no ISIS and no Russian involvement. 

But it was all about the election.

--John McCain / New York Times

“Some years ago, I heard Natan Sharansky, the human rights icon, recount how he and his fellow refuseniks in the Soviet Union took renewed courage from statements made on their behalf by President Ronald Reagan. Word had reached the gulag that the leader of the most powerful nation on earth had spoken in defense of their right to self-determination. America, personified by its president, gave them hope, and hope is a powerful defense against oppression.

“As I listened to Mr. Sharansky, I was reminded how much it had meant to my fellow P.O.W.’s and me when we heard from new additions to our ranks that Mr. Reagan, then the governor of California, had often defended our cause, demanded our humane treatment and encouraged Americans not to forget us.

“In their continuous efforts to infect us with despair and dissolve our attachment to our country, our North Vietnamese captors insisted the American government and people had forgotten us.  We were on our own, they taunted, and at their mercy.  We clung to evidence to the contrary, and let it nourish our hope that we would go home one day with our honor intact.

“That hope was the mainstay of our resistance....

“In a recent address to State Department employees, Secretary of State Rex Tillerson said conditioning our foreign policy too heavily on values creates obstacles to advance our national interests.  With those words, Secretary Tillerson sent a message to oppressed people everywhere: Don’t look to the United States for hope.  Our values make us sympathetic to your plight, and when it’s convenient, we might officially express that sympathy. But we make policy to serve our interests, which are not related to our values.  So, if you happen to be in the way of our forging relationships with your oppressors that could serve our security and economic interests, good luck to you.  You’re on your own.

“There are those who will credit Mr. Tillerson’s point of view as a straightforward if graceless elucidation of a foreign policy based on realism.  If by realism they mean policy that is rooted in the world as it is, not as we wish it to be, they couldn’t be more wrong.

“I consider myself a realist. I have certainly seen my share of the world as it really is and not how I wish it would be.  What I’ve learned is that it is foolish to view realism and idealism as incompatible or to consider our power and wealth as encumbered by the demands of justice, morality and conscience.

“In the real world, as lived and experienced by real people, the demand for human rights and dignity, the longing for liberty and justice and opportunity, the hatred of oppression and corruption and cruelty is reality.  By denying this experience, we deny the aspirations of billions of people, and invite their enduring resentment....

“To view foreign policy as simply transactional is more dangerous than its proponents realize. Depriving the oppressed of a beacon of hope could lose us the world we have built and thrived in.  It could cost our reputation in history as the nation distinct from all others in our achievements, our identity and our enduring influence on mankind.  Our values are central to all three.

“Were they not, we would be one great power among the others of history. We would acquire wealth and power for a time, before receding into the disputed past. But we are a more exceptional country than that.

“We saw the world as it was and we made it better.”

--The U.S. Immigrations and Customs Enforcement (ICE) announced it had arrested 1,378 people over the last six weeks in a massive gang-related operation, with nearly 1,000 of those taken in confirmed as gang members – involved in cross-border criminal activity.  More than 900 were U.S. citizens.

--Maureen Callahan / New York Post

“He rose to fame parodying a blowhard. Is he aware he’s become one?

“Last Tuesday (Ed. May 2), ‘Late Show’ host Stephen Colbert – who’d been struggling in the ratings until the election – made national headlines for a monologue that, as it does nightly, skewered  President Trump....

“ ‘Sir,’ Colbert continued, ‘you attract more skinheads than Rogaine.  You have more people marching against you than cancer.  You talk like a sign-language gorilla that got hit in the head.  In fact, the only thing your mouth is good for is being Vladimir Putin’s c—k holster.’

“The monologue isn’t offensive politically. It’s offensive because it’s just not funny.  Colbert fails to see the irony in taking umbrage at Trump’s crude insults by hurling crude insults.

“In a recent piece on Colbert in The New Yorker, TV critic Emily Nussbaum, formerly a fan, noted Colbert’s comedic devolution.  ‘Attacking Trump isn’t in itself subversive,’ she wrote, adding that his Trump-focused monologues ‘feel cognitively draining, not unlike political punditry.’

“And it’s not just Colbert. There’s an archness and stridency among his fellow ‘Daily Show’ alums like John Oliver and Samantha Bee, and it’s unclear what they hope to accomplish.  Oliver quite literally yells for 30 minutes at an audience that already agrees with him....

“In a recent, wide-ranging interview with New York Magazine, David Letterman cast shade on his successor’s anti-Trump fixation.

“ ‘A lot of people have been able to root themselves in the Trump tsunami, and Stephen is one of them,’ Letterman said.  ‘I’m aware that Stephen has been able to solidify his position.’

“So, too, have others: Seth Meyers is just as political, but he has a much lighter touch and meets the Trump administration on its own ground, as theater of the absurd.  Fallon caught a lot of heat for hosting Trump pre-election and ruffling his hair, but his ratings have held steady.  Most notable, however, is Jimmy Kimmel, who delivered a heartfelt monologue about his infant son’s life-saving surgery and, in the run-up to the vote on repealing ObamaCare, the importance of preserving it.

“ ‘If your baby is going to die, and it doesn’t have to, it shouldn’t matter how much money you make,’ Kimmel said.  ‘I think that’s something, whether you’re a Republican or Democrat or something else, we all agree on that, right?’

“It was human, humble and, most importantly, effective.

“By Friday, physician and Republican Sen. Bill Cassidy of Louisiana said any new health-care legislation should ‘pass the Jimmy Kimmel test.’  That, Colbert and his ilk should note, is how you begin to move the needle.”

--I do not involve myself in state politics, certainly not nearly to the extent that I try to keep up with the global scene more than what’s going on in New Jersey for the most part, but with our state primary coming up, I can’t help but note I met GOP gubernatorial candidate Jack Ciatarrelli at a small gathering last weekend in New Providence and I liked the guy.  So I’m on board, voting for him come June 6.

I was also talking to a former state prosecutor who I respect a lot and he totally trashed Kim Guadagno, the current GOP favorite to replace Chris Christie, as the two had worked together for a spell.

--According to the New York Post’s Page Six, “Sandra Lee refused to let House Speaker Paul Ryan join her cooking segment on Fox News and told him, ‘I need you to go away.’”

You see, Ms. Lee, longtime girlfriend of Gov. Andrew Cuomo, a Democrat, was not happy her segment on Tuesday’s “Fox & Friends’ would directly follow an interview with Speaker Ryan.

So the hosts asked Ryan to stick around for Lee’s bit so he could try the food, but in the break before her demo, “she said to Ryan and some others there, ‘I need you to go away so I can collect my thoughts, prepare, and get ready for the segment.’”

And so Sandra Lee is thrown in the December file for “Jerk of the Year” consideration. 

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Pray for the men and women of the armed forces...and all the fallen.

God bless America.

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Gold $1227
Oil $47.82

Returns for the week 5/8-5/12

Dow Jones  -0.5%  [20896]
S&P 500  -0.4%  [2390]
S&P MidCap  -1.1%
Russell 2000  -1.0%
Nasdaq  +0.3%  [6121]

Returns for the period 1/1/17-5/12/17

Dow Jones  +5.7%
S&P 500  +6.8%
S&P MidCap  +3.5%
Russell 2000  +1.9%
Nasdaq  +13.7%

Bulls 58.7
Bears 17.3 [Source: Investors Intelligence]

Have a great week.

Brian Trumbore