Week in Review

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Week in Review

06/11/2022

For the week 6/6-6/10

[Posted 8:30 PM ET, Friday]

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Edition 1,208

Last weekend, starting Thursday, I was at the Jersey Shore with some of my closest friends.  Eight of us have known each other for 50 years, since ninth grade, or earlier, and we formed a special bond in high school (the genesis was a weekly poker game) and for the last few decades have gotten together once a year (for all eight), while five of us see each other numerous times the rest of the year.

This year, one of the eight was unable to be there, but I’ll just give you a little background, all of us Summit High School grads.

Two are Stanford MBAs, one has his MBA from Northwestern, another from Dartmouth.

We have two Lehigh grads, another from St. Lawrence, and yours truly with his sheepskin from Wake Forest.

Seven of the eight ended up in the financial world, in one form or another, and the eighth is a highly successful software sales executive.

Politically, I would describe one as being on the Left (not Far Left), two in the Center, four Center-Right (including moi), and one on the Right (not Far Right). 

And this weekend, we reached consensus on one thing.  We’ve never been more down on the future of our country and American democracy.  It’s the extremes on either end that disturb us, as is the case with probably 50-60 percent of Americans these days, the extremes representing 20-25 percent each, by my way of thinking.

I don’t have anything really profound to add, but it was interesting seeing where we stood, and how negative we were.

Well, nothing that then happened this week would have changed our moods.  It was all about sky-high inflation.  Next week it will be about the Federal Reserve’s reaction to the soaring prices.

I have a lot on Friday’s May consumer price report down below, but we are dealing with 40-year highs in prices, groceries up 11.9% from a year ago, airfare up 12.6% in a month, the third consecutive double-digit rise (38% year-on-year).

Fuel oil is up 106.7%, with the nationwide average price for regular gasoline at the pump now $4.99 ($6.42 in California, $5.29 at the pump down the street), diesel $5.75.

Airlines are dealing with the highest inflation-adjusted jet fuel prices since 2009.

We also got a key report on consumer sentiment from the Univ. of Michigan and that came in at an all-time low.

Meanwhile, stocks tanked anew, and earnings projections remain far too high, with the Bloomberg Commodity Spot Index, which tracks prices for 23 raw materials, rising to its highest-ever level this week, driven by the energy sector. 

And mortgage rates continue to surge, 5.57% on a 30-year fixed rate, and it’s no surprise with such a rapid rise in this key economic barometer, from 3.11% at year end, mortgage demand is at its lowest level in 22 years.

Inflation is killing the lower- and middle-class, particularly Blacks and Hispanics, because on average, a larger proportion of their income is consumed by necessities.

I’ve been a broken record on the topic for months now.  The rate of inflation will come down, but at a certain point that will be largely meaningless, as we roll off some high figures in year-on-year comparisons.  The fact is we will be resetting at much higher prices, primarily for the two things most important to the bulk of Americans, food and energy.

For President Biden and the Democrats, it’s a deadly formula come November.

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In Putin’s War, Ukraine and the West accuse Moscow of weaponizing food supplies.

Just to give one example of how out of control the global food crisis could get, Egypt receives over 85% of its wheat imports from Russia and Ukraine. 

The Economist estimates that the number of those at immediate risk of “acute food insecurity” has risen from 108 million to 193 million over the past five years, before Putin’s war made things far worse.

A recent report from Oxford Economics noted: “We have already seen an increase in social unrest in South Africa, Morocco, Tunisia and Ghana, while the fear of unrest has guided policy in Nigeria and Egypt.  We will undoubtedly see more unrest in some countries, the question is where and to what extent.”

Lastly, Ret. Maj. Gen. Mick Ryan of the Australian Army, educated in the U.S., had a 24-tweet thread that made the point: “Strategic patience is needed in our support for Ukraine to defeat the Russian invasion.”

“Populations in democracies can be fickle.  Opinions change often and attention spans can be short.  But this is part of the to and fro, and open expression of views, that is so essential in democratic systems,” he writes.

“Asking citizens to remain patient as their costs of living escalate, and their attention to the war declines, is a tough ask for governments.  It will probably not be popular,” Ryan admits.

“Strategic patience is required because it is a demonstration that the democracies of the world have the resilience, unity, and perseverance to resist the coercion and aggression of all of this era’s techno-authoritarian regimes… The fight in Ukraine is as much about the kind of world we wish to live in as it is about defeating Russian aggression.”  [Defense News]

Tuesday, Volodymyr Zelensky said Kyiv would not settle for a battlefield stalemate with Russia and that it aimed to regain control of all its territory occupied by Moscow.  “We have already lost too many people to simply cede our territory,” he said.

For his part, Vlad the Impaler on Thursday likened himself to Peter the Great on the 350th anniversary of Peter’s birth.

Peter the Great was the emperor who expanded Russian territory in the 18th century through endless conflict.  Putin, addressing young ‘entrepreneurs,’ appeared to link his invasion of Ukraine with Russia’s imperial past.

“What was [Peter] doing?” Putin asked the audience, according to the Associated Press.  “Taking back and reinforcing. That’s what he did. And it looks like it fell on us to take back and reinforce as well.”

The czar is the model autocratic leader that Putin has long aspired to be, according to Russia experts.

Putin told the Financial Times in a 2019 interview that the czar will “live as long as his cause is alive.”

And so, as Putin’s War unfolded this week….

--Sunday….

Russia took aim at Western military supplies with early Sunday airstrikes in Kyiv, with Moscow claiming it had destroyed tanks donated from abroad.  Kyiv had experienced weeks of eerie calm, no such strikes since April 28, when UN Secretary-General Antonio Guterres was visiting.

The Russian Defense Ministry said high-precision, long-range air-launched missiles were used and that the strikes had destroyed T-72 tanks supplied by Eastern European countries.

President Putin then warned the United States in an interview broadcast on Sunday that Russia would strike new targets if the West supplied longer-range missiles to Ukraine for use in high-precision mobile rocket systems.

President Biden last week said Washington would supply Ukraine with M142 High Mobility Artillery Rocket Systems, or HIMARS, after he received assurances from Kyiv that it would not be used to target Russia.

Putin said the arms shipments were “nothing new” and changed nothing but cautioned that there would be a response if the U.S. supplied longer-range munitions for the HIMARS systems which have a maximum range of up to 186 miles or more.  If longer-range missiles are supplied, “we will strike at those targets which we have not yet been hitting,” Putin told Rossiya-1 state television.

Putin said the arms merely replaced those that Russia had destroyed.  Putin did not identify the targets Russia would strike, but said the “fuss” around Western arms supplies was designed to drag out the conflict.

[The UK said it would send rocket systems to Ukraine that will let it strike locations as far as 50 miles away.]

--Ukrainian President Volodymyr Zelensky visited front-line troops on Sunday in the southeastern region of Zaporizhzhia.  “I want to thank you for your great work, for your service, for protecting all of us, our state,” a statement from his office read.

Later, in his nightly video address, Zelensky said he had been in Lysychansk and Soledar, but didn’t elaborate.  In separate videos released later, Zelensky is shown telling troops, “What you all deserve is victory – that is the most important thing.  But not at any cost.”

Earlier, Zelensky said enemy forces now control almost 20% of the country’s territory.  Before the war, Russia controlled 7%, including Crimea and parts of the Donbas.

Andrei Kolesnikov, a senior fellow at the Carnegie Endowment for International Peace, said, “Of course (Russia) intends to stay.”  To Moscow, “it’s a pity to give away what has been occupied, even if it was not part of the original plan,” that being to install a puppet-regime in Kyiv that would prevent Ukraine from joining NATO and pulling further away from Russia’s influence.

--Russian Foreign Minister Sergei Lavrov’s visit to Serbia was canceled after countries around Serbia closed their airspace to his aircraft.  A Serbian media report said Bulgaria, North Macedonia and Montenegro had closed their airspace to the plane that would have carried Lavrov to Belgrade.

Serbia, which has close cultural ties with Russia, has fended off pressure to take sides over Russia’s invasion of Ukraine and has not joined Western sanctions against Moscow.

Russia has an agreement to supply Serbia with natural gas, while other countries have been cut off for refusing to pay for Russian gas in rubles.

--Monday….

President Zelensky said there could be as much as 75 million tons of grain stuck in Ukraine by this autumn and that Kyiv wanted anti-ship weapons that could secure the safe passage of its exports.  Zelensky said he was discussing with Britain and Turkey the idea of a third country’s navy guaranteeing the passage of Ukrainian grain exports through the Russia-dominated Black Sea.  The strongest guarantees of their safe passage though would be Ukrainian weaponry, he told reporters.

European Council President Charles Michel accused Russia on Monday of using food supplies as “a stealth missile against developing countries” and blamed the Kremlin for a looming global food crisis, prompting Moscow’s UN ambassador to walk out of a Security Council meeting.

“This is driving up food prices, pushing people into poverty, and destabilizing entire regions,” Michel said.  “Russia is solely responsible for this looming food crisis.  Russia alone.”

Michel also accused Russian forces of stealing grain from areas it has occupied “while shifting the blame on others,” calling this “cowardly” and “propaganda, pure and simple.”

--A report from Bloomberg notes that Russia is earning less from its oil exports, even as seaborne crude shipments surge to a six-week high. That’s due to big discounts Moscow is offering Asian buyers to snap up the barrels shunned by Europe.

The European Union’s recently adopted package of sanctions on oil imports from Russia doesn’t come into force until Dec. 5 and is limited to volumes shipped by sea and excludes deliveries through a key pipeline system.

Self-sanctioning of Russia oil by European countries has already diverted significant crude volumes to Asia, with about 660,000 barrels a day of Russian crude discharged at Indian ports in May, up from about 270,000 barrels a day the previous month.

But while volumes shipped increase, Moscow’s revenue from export duty moved in the opposite direction, falling by 5%.  [Julian Lee / Bloomberg]

--Vladimir Putin signed a decree ordering the payment of 5 million rubles ($81,500) to the families of each member of Russia’s National Guard who died in Ukraine and Syria, TASS reported on Monday.

--A second Russian general was reportedly killed after heavy fighting in the Donbas region over the weekend.

Lt. Gen. Roman Berdnikov, formerly the commander of Russian troops in Syria, possibly died in the same battle that killed Russian Maj. Gen. Roman Kutuzov, as reported by a Russian-language Telegram channel.

The generals were in an armored column that was ambushed by Ukrainian forces, according to reports.

--Tuesday….

Russia claimed near-victory in its fight for an eastern Ukrainian industrial region whose capture is one of Moscow’s main stated war aims, as Ukraine acknowledged that it was waging a tough battle to keep one of its last cities there from falling.

Fierce street-fighting was reported in Severodonetsk, with President Zelensky saying that despite being outnumbered and outgunned there, “our heroes do not give up positions.”

Ukraine redoubled its pleas for more heavy weaponry to slow advances by Moscow’s troops, which are backed by relentless artillery fire in the Donbas.

Zelensky, in remarks by videolink to an event sponsored by the Financial Times, said the country needs more “powerful weapons” from the West, as well as political support and stringent sanctions, in order to deny Russia additional battlefield gains.

In response to a question, Zelensky also offered a sharp retort to French President Emmanuel Macron’s concerns, voiced in recent days, that it was important not to “humiliate” Putin.  Ukraine took that as implicit pressure to offer Moscow territorial concessions to end the war.

“We are not going to humiliate anyone,” Zelensky said.  “We are going to respond in kind.”

Zelensky also said Tuesday that Kyiv would not settle for a battlefield stalemate with Russia and that it aimed to regain control of all its territory occupied by Moscow.

“We have already lost too many people to simply cede our territory.  We have to achieve a full deoccupation of our entire territory,” he said.

--British officials said allegations that Russia is stealing grain from a wide variety of areas in Ukraine must be investigated immediately.  World food prices continue to soar to record levels, triggering protests across developing countries.

British farming minister Victoria Prentis, speaking at an International Grains Council  conference in London, said she had heard allegations of grain theft by Russia first-hand from sources in the Kherson region in south Ukraine.

Weeks ago I told you how satellite imagery revealed Russia actually stealing the grain from silos at ports.  You could see the grain pouring out, the detail was that good.

The United Nations continues to try to broker a deal to enable Ukraine’s grain to be shipped from Black Sea ports such as Odesa, but, again, Russia wants sanctions lifted as part of any deal.

Russia blames the situation on what it says are Ukrainian mines in Black Sea waters and on the sanctions against its own economy.  Ukraine said recently that Russia was shipping stolen grain to Turkey out of Crimea.  It also accused Russia of sending its ally Syria 100,000 tons of stolen Ukrainian wheat.

--There were unconfirmed reports of a cholera outbreak in Mariupol, the port city the Russians razed before occupying.

--Belarusian armed forces began taking part in combat readiness training, the country’s defense ministry said on Tuesday.  Not good.

--Wednesday….

The Kremlin said on Wednesday that for Russian grain to be delivered to international markets, sanctions on the country must be lifted.  Kremlin spokesman Dmitry Peskov said in a call with reporters that “no substantive discussions” about lifting sanctions were ongoing.

The same day, Foreign Minister Lavrov said Moscow would not use the situation surrounding grain shipments in and around the Black Sea to advance its “special military operation,” as long as Ukraine lets ships leave safely.  “These are guarantees from the president of Russia,” Lavrov said.

But Kyiv is skeptical of the Kremlin’s intentions and seeking strong security guarantees that would allow it to export the critical commodity.

Later Wednesday, Turkey’s foreign minister said a UN plan to ease the grain export crisis was “reasonable,” and required more talks with Moscow and Kyiv to ensure ships’ safety.

Speaking alongside Russian Foreign Minister Lavrov, Turkey’s Mevlut Cavusoglu said their meeting in Ankara was fruitful.

But Ukraine’s ambassador to Turkey accused Russia of putting forward unrealistic proposals, such as checking vessels.  Lavrov said the onus was on Ukraine to solve the grain shipment problem by clearing mines from its Black Sea ports and that Russia needed to take no action because it had already made the necessary commitments.  Ukraine dismissed such talk as “empty words.”

--Ukrainian forces were pushed back by a Russian bombardment in the eastern city of Severodonetsk and now only controlled its outskirts, the region’s governor told a Ukraine media outlet.

--Former German Chancellor Angela Merkel made a return to the public arena, saying Vladimir Putin made a “big mistake” by invading Ukraine but warning that isolating Russia isn’t possible over the long term.

--Consumer inflation in Russia slowed to 17.1% year-over-year in May from 17.8% in April, which was its highest level since Jan. 2002, data showed on Wednesday, ahead of a central bank rate-setting meeting.

--Thursday/Friday….

Ukraine’s deputy head of military intelligence said Ukraine is losing against Russia on the front lines and is now almost solely reliant on weapons from the West to keep Russia at bay.

“This is an artillery war now,” said Vadym Skibitsky, deputy head of Ukraine’s military intelligence. The front lines were now where the future would be decided, he told the Guardian, “and we are losing in terms of artillery.”

“Everything now depends on what [the West] gives us,” said Skibitsky. “Ukraine has one artillery piece to 10 to 15 Russian artillery pieces.  Our Western partners have given us about 10 percent of what they have.”

Ukraine is using 5,000 to 6,000 artillery rounds a day, according to Skibitsky.  “We have almost used up all of our [artillery] ammunition and are now using 155-caliber NATO standard shells,” he said of the ammunition being fired from artillery pieces.

“Europe is also delivering lower-caliber shells but as Europe runs out, the amount is getting smaller.”

Earlier, a Ukrainian presidential adviser told the Guardian that Ukraine needed 60 multiple-rocket launchers – many more than the handful promised so far by the UK and U.S. – to have a chance of defeating Russia.

But Skibitsky also said, “We have noticed that Russia is carrying out far fewer rocket attacks and it has used H-22 rockets; they are old 1970s Soviet rockets. This shows that Russia is running low on rockets.” Skibitsky said Russia was unable to produce rockets quickly because of the sanctions and that it had used around 60 percent of its supplies.

--President Zelensky said on Thursday that he had “positive” news from the southeastern Zaporizhzhia region, where he said Ukraine’s forces were managing to thwart Russian troops.

In a video address, Zelensky also said Ukrainian forces were gradually advancing in the Kharkiv region, east of Kyiv, “liberating our land.”

--But in Mariupol, the human cost of the war mounted as workers pulled up to 100 bodies from each smashed building in the devastated city – what a local official described as an “endless caravan of death.”

According to a mayoral aide, many buildings in Mariupol contain 50 to 100 bodies each. The bodies are being taken to morgues, landfills and other places.  Ukrainian authorities estimate at least 21,000 Mariupol civilians were killed during the weeks-long Russian siege.

--Russia has transferred more than 1,000 Ukrainian soldiers, taken in Mariupol, to its territory, Russia’s state news agency TASS reported, giving Moscow a powerful bargaining chip.

But more than 2,500 were taken captive from the Azovstal steelworks overall.

“There is only one possible solution – to return those people home,” Zelensky said. “We know what it’s like to cut deals with Russia; we know the price we will have to pay. We know that they cannot be trusted.”

--Two Britons and a Moroccan who were captured fighting for Ukraine were sentenced to death by a court in self-proclaimed Donetsk People’s Republic (DPR).

The court found the three men guilty of “mercenary activities and committing actions aimed at seizing power and overthrowing the constitutional order of the DPR,” the Interfax news agency quoted a court official as saying.

A total sham judgement from a non-existent ‘state.’ A show-trial, hastily held. 

--The mayor of Mariupol said sanitation systems were broken and corpses rotting in the streets.

“There is an outbreak of dysentery and cholera… The war which took over 20,000 residents, unfortunately, with these infection outbreaks, will claim thousands more Mariupolites,” he told national television today.

So sickening and despicable. 

America and Europe must stay strong in our support of Ukraine.  If we fail to do so, we are guaranteeing war on the European continent for the rest of the decade.

Some commentary….

Editorial / The Economist

“Even if he never uses the bomb in Ukraine, Mr. Putin has thus already upset the nuclear order. After his threats, NATO limited the support it was prepared to offer, with two implications that are all the more worrying for having been drowned out by the drumbeat of Russia’s conventional campaign.  One is that vulnerable states that see the world through Ukraine’s eyes will feel that the best defense against a nuclear-armed aggressor is to have weapons of their own.  The other is that other nuclear-armed states will believe that they can gain by copying Mr. Putin’s tactics.  If so, someone somewhere will surely turn their threat into reality.  That must not be this war’s devastating legacy.

“The nuclear danger was growing before the invasion.  North Korea has dozens of warheads.  Iran, the UN said this week, has enough enriched uranium for its first bomb.  Although the New Start treaty will limit Russia’s and America’s intercontinental ballistic missiles until 2026, it does not cover weapons such as nuclear torpedoes.  Pakistan is rapidly adding to its arsenal. China is modernizing its nuclear forces and, the Pentagon says, expanding them.

“All this proliferation reflects the weakening of the moral revulsion that restrains the use of nuclear weapons.  As memories of Hiroshima and Nagasaki fade, people fail to grasp how the detonation of a small battlefield weapon, of the sort Mr. Putin might lob, could escalate into the tit-for-tat annihilation of entire cities.  America and the Soviet Union only just coped with a two-sided nuclear stand-off.  There is insufficient alarm at the prospect of many nuclear powers struggling to keep the peace….

“Mr. Putin’s strategy of issuing nuclear threats is even more corrosive.  In the decades after the Second World War, the nuclear powers contemplated deploying atomic weapons in battle.  But in the past half-century such warnings have been issued only against countries, such as Iraq and North Korea, that were themselves threatening to use weapons of mass destruction.  Mr. Putin is different because he is invoking atomic threats to help his invading forces win a conventional war.

“And it seems to have worked.  True, NATO’s support for Ukraine has been more robust than expected. But the alliance has hesitated to dispatch ‘offensive’ weapons such as aircraft.  Although America’s president, Joe Biden, has sent vast amounts of arms, this week he demurred from providing missiles able to strike deep inside Russia.  Others in NATO seem to think that Ukraine should settle with Russia, because inflicting a defeat on Mr. Putin could back him into a corner, with dire consequences.

“That logic sets a dangerous precedent.  China could impose similar conditions if it attacked Taiwan, arguing that the island is already Chinese territory.  More states may amass more battlefield weapons.  That would flout the Nuclear Non-proliferation treaty, under which they are pledged to work for disarmament….

“Sparing Ukraine from a nuclear attack is essential, but it is not enough. The world must also make certain that Mr. Putin does not prosper from his aggression today, as he prospered in 2014.  If, once again, he believes that his tactics worked, he will issue more nuclear threats in the future.  If he concludes NATO can be intimidated, persuading him that he must back down will be harder.  Others will learn from his example.  Ukraine therefore needs advanced weapons, economic aid and sanctions on Russia in order to force Mr. Putin’s army into a retreat.

“Those countries that see this as just a passing European fight are neglecting their own security.  And those arguing in the name of peace that Ukraine needs a truce with Russia right now, to avoid being bogged down in a war it cannot win with an enemy that has already lost its sting, could not be more wrong.  If Mr. Putin thought NATO lacked resolve Russia would remain dangerous.  If he were convinced that his nuclear threats had been the difference between defeat and a face-saving stalemate, Russia would be more dangerous than ever.”

Biden Agenda

--A new ABC News/Ipsos poll finds that President Biden’s approval rating on a number of key issues remains underwater.

While a majority, 56%, continue to approve of Biden’s Covid-19 response, this is it.

Currently, 37% of Americans approve of Biden’s handling of the economy, a 16-point decline from nearly a year ago.

Only a quarter approve of Biden’s handling of inflation (28%) and gas prices (27%).  Notably, Biden only earns a bare majority of Democrats’ support on both of these issues: 56% of Democrats approve of the job he’s doing on inflation, and 51% feel the same about gas prices.

Two in five Americans say they are very enthusiastic to vote in November, unchanged from April (39%).  Republicans hold a significant advantage in voting enthusiasm: 57% say they are very enthusiastic, compared to 44% of Democrats.

Among those who are most enthusiastic, 66% say the economy will be extremely important in their vote.  Sixty-two percent say the same about inflation.

In a nationwide Quinnipiac University poll, 42% approve of Biden’s response to Russia’s invasion of Ukraine, while 50% disapprove.

32% approve of Biden’s handling of gun violence, 59% disapprove.

28% approve of his handling of the economy, 64% disapprove.

Americans say inflation (34%) is the most urgent issue facing the country today, followed by gun violence (17%).

Among independents, the top issues are inflation (37%) and gun violence (16%).

--The president hosted a Summit of the Americas in Los Angeles, though only about half the countries showed up…Honduras, El Salvador, Guatemala and Mexico no-shows over the exclusion of Venezuela, Nicaragua and Cuba.

President Biden and his Brazilian counterpart, Jair Bolsonaro, met for the first time and agreed to work together on several issues, including preventing further deforestation of the Amazon.

--The administration is lifting its requirement that international air travelers to the U.S. take a Covid-19 test within a day before boarding their flights, easing one of the last remaining government mandates meant to contain the spread of the coronavirus.

The mandate will expire Sunday at 12:01 a.m. EDT, saying that the CDC has determined that it’s no longer necessary.  The testing requirement will be reviewed every 90 days and could be reinstated if a troubling new variant emerges.

This is big…a lot less hassle at the end of a trip, for Americans, and making the U.S. a little more attractive for Europeans and Asians looking to travel here.

--President Biden invoked the Defense Production Act to spur U.S. solar panel manufacturing and exempted tariffs on solar panels from four Southeast Asian nations for two years as part of his push for clean energy.

The tariff waiver applies to panels from Cambodia, Malaysia, Thailand and Vietnam and will serve as a “bridge” while U.S. manufacturing ramps up, it said in a statement.

Out of nowhere, on the surface sound policy from the administration. 

--House lawmakers will propose a 4.6% pay raise for servicemembers next year as part of their initial draft of the annual defense authorization bill, but this would hardly keep up with family financial needs in an 8% inflation environment.

--Dan Balz / Washington Post (June 4)…Balz one of the true veterans of the Washington political scene.

“In recent days, President Biden has spoken about guns on prime-time television and written for the Wall Street Journal (about inflation) and the New York Times (about Ukraine).  He’s traveled to Uvalde, Tex., to grieve over the mass shooting that killed 19 children and two teachers.  On Wednesday, he led a White House meeting to discuss the infant formula shortage.  On Friday, he was out again, this time from Delaware, speaking about the economy and inflation.

“In other words, the president seems to be everywhere. But to what end?  It is something that worries Democrats toward the November midterm elections. But is it a problem of messaging or of policy, of words without impact or simply a sign of a weary and unhappy electorate that has stopped paying close attention to a president? Whatever it is, the political ramifications are serious. Biden has little time to figure it out, if it can be figured out, before voters render their judgment on his first two years in office….

“The constant visibility of the president has come alongside the relative invisibility of senior administration officials.  Secretary of State Antony Blinken and Defense Secretary Lloyd Austin have been in the public eye because of Russia’s military aggression against Ukraine.  Attorney General Merrick Garland, dealing with the aftermath of the Jan. 6, 2021, attack on the Capitol, has made several well-covered speeches.  Most domestic Cabinet officials have remained much more in the shadows.

“Transportation Secretary Pete Buttigieg, Energy Secretary Jennifer Granholm, Labor Secretary Marty Walsh, Commerce Secretary Gina Raimondo, Housing Secretary Marica Fudge, Agriculture Secretary Tom Vilsack, Health and Human Services Secretary Xavier Becerra – all have important portfolios and responsibilities responding to the many challenges around the country. But they aren’t much seen….

“On Tuesday, a frustrated Biden sent senior officials out in force across television programs to make their case that they are doing everything to slow the rise in prices.  Some populate the Sunday morning talk shows. But while Cabinet officials take occasional bows, they are underemployed as messengers….

“Biden’s opponents will criticize him no matter what posture he takes.  During the 2020 campaign, he was blasted by President Donald Trump and GOP officials, who accused him of hiding in his basement in Delaware during the pandemic. His low-profile strategy worked. In that case less was more; he won the election.  But the opposite approach, the always visible president, continues to show its limitations.”

Wall Street and the Economy

There was only one major economic data point this week and it was a biggie…the May reading on consumer prices and the news wasn’t good, a bigger than expected increase of 1.0%, vs. an estimated 0.7%, while core prices (ex-food and energy) rose 0.6%, the same increase as in April.

Year-over-year, the CPI is at 8.6%, the highest since 1981, with core prices, 6.0%, which while lower than a recent peak of 6.5%, is still at a level not seen since 1982.  The consensus forecasts had been 8.2% and 5.9% for these two barometers.

Treasury Secretary Janet Yellen told the House Ways and Means Committee on Wednesday that the current inflation rate of 8% is “unacceptable” and a 2% inflation target for the Federal Reserve is an “appropriate target.”

“Higher food and energy prices are having stagflationary effects, namely, depressing output and spending and raising inflation all around the world,” Yellen said earlier.

The World Bank, in its latest Global Economic Prospects report, delivered one of its bleakest assessments of the global economy in years.

Global growth is expected to slump from 5.7% in 2021 to 2.9% in 2022 – significantly lower than the 4.1% the WB anticipated in January.  It is expected “to hover around that pace over 2023-24,” as the war in Ukraine disrupts activity, investment, and trade in the near term, pent-up demand fades, and fiscal and monetary policy accommodation is withdrawn.  The bank noted that the level of per capita income in developing economies this year would be nearly 5% below its pre-pandemic trend.

“The war in Ukraine, lockdowns in China, supply-chain disruptions, and the risk of stagflation are hammering growth.  For many countries recession will be hard to avoid,” World Bank group president David Malpass said.  “Markets look forward, so it is urgent to encourage production and avoid trade restrictions.  Changes in fiscal, monetary, climate and debt policy are needed to counter capital misallocation and inequality,” he said.

The WB’s report said the current juncture resembles the 1970s in three key aspects: persistent supply-side disturbances fueling inflation, preceded by a protracted period of highly accommodative monetary policy in major advanced economies, prospects for weakening growth, and vulnerabilities that emerging market and developing economies face with respect to the monetary policy tightening that will be needed to rein in inflation.”

But, unlike in the 1970s, the dollar is strong, the jump in commodity prices is a bit smaller, and the balance sheets of major financial institutions are generally strong.

“More importantly, unlike the 1970s, central banks in advanced economies and many developing economies now have clear mandates for price stability, and, over the past three decades, they have established a credible track record of achieving their inflation targets,” it said.

But decisive global and national policy action is required.

The Organization for Economic Cooperation and Development (the Paris-based club of developed nations) issued its updated economic forecast for the global economy on Wednesday, with global growth projected to slow sharply this year to 3%, around 1 ½ percentage points weaker than projected in December 2021, the authors warned.  What’s more, “The effects of the war in Ukraine may be even greater than assumed, for example because of an abrupt Europe-wide interruption of flows of gas from Russia, further increases in commodity prices, or stronger disruptions to global supply chains.”

Big picture: “Growth is set to be markedly weaker than expected in almost all economies,” with many of the “hardest-hit” countries in the European Union, which is coping with an energy crisis and a refugee crisis at once.

About the unrest: A “cost of living crisis” already looms for many of the world’s countries; but now, “With public budgets stretched by two years of the pandemic, these countries could struggle to provide food and energy at affordable rates to their populations, risking famine and social unrest,” according to the new report.

Growth will slow further next year, easing to 2.8%, down from a previous forecast of 3.2%.

The eurozone economy is forecast to grow 2.6% this year and 1.6% in 2023, down from prior projections of 4.3% and 2.5%, respectively.

China’s economy is seen growing 4.4% this year and 4.9% next, down from 5.1% previously forecast in both years.

Finally, we did have another positive report on the budget deficit, just $66 billion in May, reflecting continued strength in receipts as the economy recovers from the pandemic and as spending related to it slows further, the Treasury Department said today.

The deficit was down by a half from a $132 billion shortfall a year earlier and was the smallest budget gap for the month since 2016.

For the first eight months of the 2022 fiscal year, the government reported a deficit of $426 billion, down 79% from the year-earlier deficit of $2.064 trillion.  Year-to-date receipts are up 29% to $3.375 trillion – a record for the period.

Separately, the Atlanta Fed’s GDPNow barometer for second-quarter growth sits at just 0.9%.

Europe and Asia

As expected, the European Central Bank, meeting on Thursday, prepared the market for a series of interest rate hikes (finally), starting with a quarter-point in July and a possible larger increase in September.

The ECB ended a long-running stimulus scheme (quantitative easing, QE) as well, with inflation at a record-high 8.1% and still rising.

The central bank for the 19 countries that use the euro said it would end QE on July 1, then raise interest rates by 25 basis points on July 21.  It will then hike rates further on Sept. 8 and go for a bigger move, unless the inflation outlook improves in the meantime.

ECB President Christine Lagarde said, “We will make sure that inflation returns to our 2% target over the medium term.”

The euro area economy expanded by 0.6% in the first quarter, compared to a prior estimate of 0.3%, Eurostat said Wednesday.  That was helped by the external-trade balance and change in inventories. Compared with the same quarter of the previous year, seasonally adjusted GDP increased by 5.4% in the eurozone.

2022Q1 vs. previous quarter

Germany 0.2%, France -0.2%, Italy 0.1%, Spain 0.3%, Netherlands 0.0%.

2022Q1 over 2021Q1

Germany 3.8%, France 4.5%, Italy 6.2%, Spain 6.4%, Netherlands 6.8%.

The above-mentioned new OECD projections show growth in the euro area at just 1.6% next year with inflation at 4.6%, partly due to the EU’s decision to impose some curbs on Russian oil imports.  The OECD’s latest projection is close to that of the European Central Bank.

The OECD sees inflation averaging 7% this year in the eurozone.

The European Commission sees growth for the euro area of 2.3% next year, while inflation slows to 2.7%, and then 2% in 2024, the ECB’s target.

The OECD said the UK economy will grind to a halt next year with only Russia performing worse among leading economies as it urged Boris Johnson’s government to cut taxes.

The UK will expand 3.6% this year – the second-fastest rate among the Group of Seven advanced nations after Canada – before sinking to the bottom of the pack.  Every other G-7 country will grow by more than 1% in 2023, the OECD forecasts.

The OECD blamed “depressed demand” for the souring projections, predicting inflation in the UK will peak at more than 10% at the end of this year – up from 9% now, and still be 4.7% at the end of 2023.

Households will take on debt “to keep up with the rising cost of living,” while businesses will cut investment in the face of higher borrowing costs, the OECD said.

The OECD also called risks to its outlook “considerable.”  Spillovers from economic sanctions on Russia or a new Covid-19 outbreak could deliver another economic blow, while more-persistent inflation or labor shortages could lead to production shutdowns, it warned.

On the euro area service sector, I missed the May numbers last Friday, posting early as I did, and the figure for the EA19 was 56.1 (50 the dividing line between growth and contraction).

Germany 55.0, France 58.3, Spain 56.5, Italy 53.7, Ireland 60.2.

UK 53.4 vs. 58.9 in April, a reflection of higher inflation having an impact on demand.

--Back to the ECB, the euro bond market has been crushed recently in anticipation of the central bank’s looming moves, with the yield on German 10-year rising from 0.96% to 1.51% the last two weeks.  During that same time the yield on the French 10-year has gone from 1.47% to 2.09%, and the Italian 10-year from 2.89% to 3.75%.

We’ve been here before when it comes to Italy, with its sky-high debt level, and shares in Italian banks plunged at week’s end, hurt by the rise in the country’s debt costs, with the end to the ECB’s purchases (QE) that put in its coffers a fifth of all Italian government bonds.

Italian banking shares are strongly correlated to the country’s debt costs.  Italy has $3 trillion in public debt.

Italy’s national statistics bureau slashed its growth estimate for this year to 2.8%, from a 4.7% projection made in December as high raw material prices and the war in Ukraine weigh on the outlook.

Britain, part II: Prime Minister Boris Johnson won a no-confidence vote but by a slim margin, as these things go, 211-148.  It does not appear that Johnson will call a snap election, but as this was a vote among party members only, in essence it means he has the support of only about a third of the British electorate overall.

Johnson, facing major issues, including record-high inflation, Brexit and Northern Ireland, will probably be forced to stand down in the next six months…at least that is what history shows.

Back in 2018, Theresa May won a vote of no confidence with 63 percent of the vote but she left office six months later.  Johnson won 59 percent. 

France: The French go to the polls this weekend for the first round of parliamentary elections to fill the 577 seats in the National Assembly and President Emmanuel Macron’s centrist camp is in a battle to obtain an absolute majority.  Polls show Macron’s coalition garnering 250-290 seats, with 289 needed, according to an Ifop Institute poll.  The newly formed left-wing alliance is seen second with 195-230 seats.

Turning to Asia…China’s private Caixin service sector reading for May was 41.4 vs. 36.2 in April; manufacturing having come in last week at 48.1 vs. 46.0.

May’s trade figures were better than expected, with exports up 16.9% year-over-year, highest in four months, and imports up 4.1%.  [Exports to the U.S. rose 12.9% in May Y/Y.]

China’s imports from Russia soared nearly 80%, a boon for Moscow as it reels from the impact of Western sanctions.  Much of the increase was for energy and agricultural products.

On the inflation front, consumer prices rose 2.1% in May, while producer/factory gate prices increased 6.4% vs. 8.0% in April, a 14-month low, so good news on this front.

May vehicle sales fell 12.6% vs. a year earlier, which was a big improvement over April’s 47.6% crash.  The government has been introducing new incentives for the auto sector.

In Japan, a second look at first-quarter growth revealed a smaller decline than expected, -0.1% Q/Q, -0.5% year-over-year.

Producer prices in May rose 9.1%, not good.

The June PMI on the service sector came in at 52.6.

Street Bytes

--It was another brutal week for stocks, particularly Thursday and Friday…the first day in anticipation of bad news on consumer prices, the second day when it became reality, and the Dow Jones, down 4.6% to 31392, has now fallen 10 of 11 weeks, the worst stretch since 1932, while the S&P 500 (off 5.1%) and Nasdaq (down 5.6%) have now fallen 9 of 10 weeks.

Next week we have the Federal Reserve…and more inflation data.

--U.S. Treasury Yields

6-mo. 1.92%  2-yr. 3.06%  10-yr. 3.16%  30-yr. 3.20%

Treasury yields soared, particularly after today’s inflation data reinforced that the Federal Reserve needs to hike rates at least 50 basis points the next three meetings (or go bigger, earlier).

The yield on the 10-year has surged from 2.74% to 3.16% in just two weeks, which is once again doing a number on mortgage rates.

--Oil prices continue to stay elevated, ending the week again at the $120 level for West Texas Intermediate, which has yet to impede demand in any meaningful way.  That will happen, but now we’re dealing with refinery issues, worldwide, which impacts capacity.  High prices are here to stay unless there is a big increase in production that no one sees coming until maybe year end at the earliest.

--Shares in Exxon Mobil Corp. hit their highest level since 2014, Wednesday, closing at $104.59, highest since June 23, 2014.  The shares have gained 71% this year and 8.9% in June alone.

There are those bitching about excess profits and price-gouging, blah blah blah…not understanding how the market works, and how government policy can interfere in sound economics, but this is what happens when the price of oil soars…those producing it make money, ditto shareholders. 

When the price of oil is collapsing, and sitting at $40, and the likes of Exxon are laying off workers and the local economies where it employs same are crapping out, and housing values are falling, and the companies servicing the now-departed Exxon workforce are going out of business, you get the flip side.

It’s not Exxon, and Chevron’s, fault the price at the pump is what it is.  It’s a combination of multiple factors, including a hostile Biden administration.

Well, the president today took a stupid shot at Exxon, blaming big oil in part for high prices, and saying “Exxon made more money than God” in its recent quarter.

--U.S. household wealth declined for the first time in two years in the first quarter of 2022, edging down to $149.3 trillion as a drop in the stock market outweighed further gains in home values, a Federal Reserve report on Thursday showed.

--Target Corp. shocked the market, again, on Tuesday, slashing its quarterly margin forecast issued just weeks earlier, and said it would have to offer deeper discounts and cut back on stocking discretionary items, as inflation dents consumer spending.  The shares in premarket trading fell 10%.

But then they recovered and by Wednesday were higher than Monday’s close as investors saw the announcement as mainly a one-off impacting results a quarter or two.  CEO Brian Cornell said while the strategy to keep a big portion of its products affordable compared with its rivals is proving to be costly, amid higher transportation costs, for one, and “these decisions will result in additional costs in the second quarter…(it will result) in improved profitability in the second half of the year and beyond.”

Target maintained its sales goals for the year.

--Shares in Intel resumed their slide this week after the company offered disconcerting commentary about the macroeconomic environment during a Bank of America Global Technology Conference.

CFO David Zinsner said the macro environment is weaker than the company anticipated coming into the quarter, and that he expects customers to reduce inventory levels, negatively impacting demand for Intel’s chips.  But most analysts see this as company specific, and not indicative of a full-scale downturn in the semiconductor industry.

Intel has had serious issues for years now.

--Airbus confirmed on Wednesday it delivered 6% fewer airplanes in May, compared to the same month last year, as the aerospace industry wrestles with supply chain issues.  It delivered 47 jets, bringing the total for the year so far to 235, up 7% from the first five months of 2021.

Deliveries included 37 of the A320-family single-aisle aircraft that make up the bulk of the company’s income, suggesting that Airbus added to a backlog of undelivered planes based on its latest announced production rate of 50 a month.

Airbus has said it wants to lift A320 output to 65 a month by the middle of next year, propelled by a brisk recovery in medium-haul travel.

The planemaker is targeting a total of 720 commercial deliveries this year and CEO Guillaume Faury said on Tuesday that Airbus remains confident in its future output projection.

In new business, Airbus reported 13 orders for jets including four more A350s from Turkish Airlines.

So far this year Airbus has sold 364 airplanes or 191 after cancellations.  As of the end of April, Boeing had sold 213 jets or 157 after comparable cancellations.

--I’ve warned that this could be a chaotic summer for travel in Europe as airports and airlines clamor to find more workers, minimize canceled flights and reduce delays. To wit:

Thursday, some 1,000 SAS pilots in Denmark, Norway and Sweden said they could go on strike from late June.

Germany’s Lufthansa and its subsidiary Eurowings said they were scrapping over 1,000 flights in July, or 5% of their planned weekend capacity, due to staff shortages.

Ryanair has halted talks with two Spanish unions over a salary hike, the unions said, amid threats the low-cost airline’s cabin crew could go on strike in several European countries during the summer season.

Europe’s biggest budget airline walked away from the talks on Tuesday arguing the strike threat by European unions showed a lack of commitment to dialogue.  Seven unions from Italy, France, Portugal, Belgium and Spain issued a statement in May warning that Ryanair’s cabin crew in those countries could launch a strike this summer if the airline did not offer a “meaningful response” to their demands for better working conditions.

Travelers then faced disruptions across Italy on Wednesday as crews from Ryanair, easyJet and Volotea went on strike, coinciding with a stoppage by air traffic controllers and prompting the cancellation of hundreds of flights.

Ryanair CEO Michael O’Leary recently said bookings looked very strong for the summer and the load factor should gradually rise to 94-95% in June-August, practically reaching pre-Covid-19 levels.

One flight out of four was cancelled Thursday morning at Paris’ Charles de Gaulle Airport due to strike action.

--On a positive note, United Airlines said Wednesday it has added a new route between Brisbane and San Francisco, starting in October.  The company said the year-round, nonstop service between the two will make it the first U.S. airline to add a new transpacific destination since the beginning of the pandemic.

The carrier currently has nonstop service to Sydney from San Francisco and Los Angeles.  The Brisbane route will operate 3 times weekly.  [Brisbane gets you closer to the Great Barrier Reef than Sydney does.]

--Meanwhile, Spirit Airlines confirmed Wednesday that it has postponed a Friday meeting about its planned merger with Frontier, but said it hasn’t changed its mind about the combination despite a rival offer from JetBlue.

JetBlue earlier this week said it would offer a $350 million reverse break-up payable to Spirit if its proposal doesn’t go through due to regulatory concerns.  That is $150 million more then JetBlue previously offered to pay.

In a Wednesday press release, Spirit said it remains “bound by the terms of the merger agreement with Frontier.”  It added that its “board has not determined that either JetBlue’s unsolicited tender offer or its updated proposal received on June 6 constitutes a Superior Proposal.”

JetBlue is offering to prepay $1.50 per share in cash of the reverse break-up fee in the form of a cash dividend to Spirit stockholders promptly following the Spirt stockholder vote approving the combination between Spirit and JetBlue.  Spirit stockholders would ultimately receive $30 per share in cash at the closing of the transaction and the prepayment of $1.50 per share of the reverse break-up fee.

JetBlue’s announcement comes less than a week after Frontier Airlines added a $250 million termination fee to its proposal.  Denver-based Frontier’s cash-and-stock offer – which is unanimously supported by Spirit’s board – had been valued at $2.9 billion when it was announced, but it has lost some of its value since then.

But, while JetBlue’s new offer is certainly creative, and kudos to the MBA grad who thought it up, again, there is no freakin’ way a JetBlue-Spirit combination will pass antitrust muster.

Spirit-Frontier could.

--TSA checkpoint travel numbers vs. 2019

6/9…89 percent of 2019 levels
6/8…86
6/7…84
6/6…86
6/5…89
6/4…89
6/3…88
6/2…84

Not one day in the 90s.  Did the airlines get demand wrong, again?

--Production at Tesla Inc.’s Shanghai factory is on track to fall by over a third this quarter from the first three months of the year as China’s zero-Covid lockdowns caused deeper disruptions to output than Elon Musk had predicted.  Tesla is aiming to make more than 71,000 vehicles at its Shanghai plant in June, according to internal production memos.  Together with the 44,301 units it produced in April and May, according to data from China Passenger Car Association, that would add up to 115,300 in the second quarter. In the first three months of the year, Tesla Shanghai manufactured 178,887 cars, according to the CPCA.

Musk, in a call with analysts in April, said vehicle production at the Shanghai plant in the second quarter would be “roughly on par” with the first quarter.  “It’s also possible we may pull a rabbit out of the hat and be slightly higher,” he said then.

But Musk more recently has been warning of the risks of recession, and that Covid restrictions in Shanghai brought “a huge challenge” and the plant was only getting back to full production.

Last week, he told Tesla executives in an email he had a “super bad feeling” about the economy and needed to cut jobs by about 10% and freeze hiring. In a follow up email to employees, he said Tesla had become “overstaffed in many areas” and that Tesla would reduce salaried headcount by 10%.

But in a tweet on Saturday, Musk backtracked and predicted that the company’s total headcount would increase over the next 12 months.

By the way, those ordering a Model 3 in Europe can only pick up their cars at the earliest in the fourth quarter, its website showed.  For buyers in China, the waiting time for Chinese-made Tesla cars is between 10 and 24 weeks.  Customers in Australia now have to wait nine to 12 months for their Model 3s.

On a different issue, U.S. auto-safety regulators have escalated their investigation into emergency-scene crashes involving Tesla Inc.’s Autopilot, a step that could lead to a safety recall.

The National Highway Traffic Safety Administration said in a notice published Thursday that it was expanding a probe begun last August into a series of crashes in which Tesla vehicles using Autopilot struck first-responder vehicles stopped for roadway emergencies.

Separately, Elon Musk has threatened to pull out of a $44 billion deal for Twitter, saying the company has refused to provide enough information about its fake accounts, which is B.S., as Twitter has already done so in SEC filings.

In a letter to the company, the billionaire said Twitter was in a “clear material breach” of its obligations and that Musk reserves all rights to terminate the merger agreement.

But Twitter now plans to basically dump all its data on Musk’s lap, in essence, saying, “Here it is, you jerk.”  Let’s face it, Musk should face stiff penalties from the SEC for the way he is treating Twitter after the board approved his proposed takeover offer!

Actually, Twitter said it had allowed Musk direct access to its “firehose,” the stream of millions of tweets that flow through the company’s network on a daily basis.

The information would give Musk the ability to ascertain how many accounts on the platform are fake.  Musk has said he doesn’t believe that just 5 percent of Twitter’s active accounts are fake.

I actually agree with Musk, as a Twitter user, but he made an offer that was accepted!  With its latest move, Twitter is trying to make it more difficult for Musk to terminate the deal.

--I love Campbell Soup, and always found the company fascinating, like come earnings time.  [I should have worked there.]

So the company raised its financial forecasts Wednesday, as higher prices and better supply-chain conditions lifted quarterly sales for its ready-to-serve soups.

I must say, the price on a can of Chunky New England Clam Chowder is rather high these days.

But Campbell reported revenue of $2.13 billion, which beat Street forecasts, and year earlier revenue of $1.98 billion.

For the full fiscal year ending in July, the company reiterated its earnings guidance, but net sales are now forecast to rise between 1% and 2% from 2021, compared with a prior estimate of a 1% decline to a 1% rise, and total sales of $8.56 billion, higher than the consensus of $8.41 billion.

The percentages don’t seem significant, but its about seeing the pandemic-driven demand for at-home meals holding strong, even as the company raised prices.  Others of its ilk, like Kellogg, have said they have accelerated price hikes as cost inflation gets worse.

Campbell CEO Mark Clouse admits that condensed soup is one area where the company continues to see the threat from store-branded products.  The baby boomer cohort tends to be more price sensitive, and don’t tell Mr. Clouse, but I’ll admit to looking for big sales on competitor Progresso soups.  But I buy Campbell’s Chicken Noodle at Dollar Tree (or $1.25 Tree, as it has become these days).

--“Top Gun: Maverick” led the domestic box office a second weekend, one of the strongest such performances ever, raking in an estimated $86 million in the U.S. and Canada, after a record-breaking debut over the Memorial Day weekend of $156 million.  The second week showing suggests that a large number of moviegoers are returning to theaters after a two-year drought caused by the pandemic.

Top Gun’s showing is notable because it has been driven by older viewers.  More than half of the film’s ticket buyers were over the age of 35 for the second weekend in a row, according to Paramount Pictures.

This year, movie ticket sales in the U.S. and Canada have reached an estimated $2.9 billion, a bit less than two-thirds of where they were during the same period in 2019, according to Comscore.

This weekend it’s about “Jurassic World: Dominion.”

The Pandemic

--China’s commercial hub of Shanghai unexpectedly faced a new round of mass Covid-19 testing for most residents this weekend – just 10 days after a city-wide lockdown was lifted – unsettling residents and raising concerns about the impact on business.  Shanghai officials on Thursday said seven of the city’s 16 districts would carry out PCR testing for all residents over the weekend due to the discovery of a few cases in the community.  Then another six districts announced similar plans.  There are fears of new lockdowns.

Meanwhile, Beijing has been easing Covid restrictions for much of the city, including the ban on restaurant dine-in, in place since May 1.  Employees who had been asked to work from home can also go back to the office.

--Moderna is seeking authorization from the Food and Drug Administration for an Omicron-specific shot that is the company’s leading candidate for a fall booster.  [I’ll take it!  I’ll take it!]

The company is optimistic that the booster will provide protection against the different versions of the Omicron variant.

--An FDA advisory committee recommended Tuesday that a fourth Covid-19 vaccine be authorized for use in the U.S., this one from Novavax, a company based in Gaithersburg, Maryland.

The vaccine, which was supported by $1.8 billion in taxpayer funding, relies on a more traditional approach than the vaccines from Pfizer and Moderna, which have been used by more than three-quarters of Americans.

A third vaccine, from Johnson & Johnson, was used in more than 16 million people, but has been recommended as a second choice because of a side effect that’s extremely rare but potentially lethal.

But Novavax would seem to be a bit late to the party, even as 73% of Americans want more vaccine choices, according to polling data.

--The World Health Organization said there have been more than 1,000 monkeypox cases reported around the world outside of countries in Africa where it more commonly spreads.  The WHO said the risk of monkeypox becoming established in these non-endemic countries was real, but preventable.  Nearly 30 countries have reported cases in the current outbreak, which began in May.

Covid-19 death tolls, as of early tonight….

World…6,329,567
USA…1,035,601
Brazil…668,007
India…524,747
Russia…379,883
Mexico…325,0901
Peru…213,296
UK…179,217
Italy…167,305
Indonesia…156,638
France…148,710

Canada…41,505

[Source: worldometers.info]

U.S. daily death tolls…Mon. 142; Tues. 368; Wed. 301; Thurs. 227; Fri. 165.

Foreign Affairs

China/Australia: We learned this week that China is secretly building a naval facility in Cambodia for the exclusive use of its military, with both countries denying this is the case and taking extraordinary measures to conceal the operation, Western officials said.

The establishment of a Chinese naval base in Cambodia – only its second such overseas outpost and its first in the strategically significant Indo-Pacific region (the base being on the Gulf of Thailand), is just another part of Beijing’s strategy to build a network of military facilities around the world as it seeks to become a true global power.

China’s only other foreign military base is in the East African country of Djibouti.

Back in 2019, the Wall Street Journal first reported that China had signed a secret agreement to allow its military to use a base in Cambodia, but over last weekend, a Chinese official confirmed to the Washington Post that “a portion of the base” will be used by “the Chinese military.”  A groundbreaking ceremony is to take place next week.

Editorial / Wall Street Journal

“Beijing has a long history of lying about its military intentions.  Recall Chinese President Xi Jinping’s promise that he wouldn’t militarize the artificial islands in the South China Sea it developed during Barack Obama’s presidency. The islands are now home to an array of advanced Chinese military equipment.

“Earlier this year China and the Solomon Islands in the South Pacific signed a security pact. Both governments deny that the agreement will lead to a Chinese base or permanent presence, but China operates in stages until one day the world learns there’s an operating base.  The Solomons aren’t far from Australia and are near important commercial shipping lanes.

“Chinese Foreign Minister Wang Yi recently took an eight-country tour through the South Pacific to drum up support for a security and development agreement.  The Pacific countries rejected a formal accord, but China will be back with more money and other promises.  China wants to dominate shipping lanes that have long been guaranteed by the reach of the U.S. Navy….

“The proliferation of PLA bases is being matched with an ever-growing Chinese navy. The U.S. is heading in the opposite direction, with 297 ships and plans to fall to 280 by 2027. China has 355 and is headed to 460 by 2030.  Beijing relies on smaller vessels, but it will soon launch an advanced aircraft carrier that will let it project airpower abroad.

“Some in Congress seem aware of this relative U.S. naval decline, but the U.S. Navy and Pentagon don’t seem alarmed.  They should be.  The Chinese military is advancing around the world, and the best guarantee of keeping the peace is a U.S. military and Navy that can reassure allies and deter hawks in Beijing.”

Meanwhile, Australia accused the pilot of a Chinese fighter jet of carrying out a dangerous maneuver near one of its aircraft over the South China Sea.  It says the Chinese aircraft released flares and cut in front of the Australian surveillance plane.

The Chinese jet then released “chaff” – an anti-radar device which includes small pieces of aluminum which entered the Australian plane’s engine.

The Royal Australian Air Force P-8 maritime surveillance aircraft was intercepted on May 26 by a Chinese J-16 fighter aircraft, during what Australian Prime Minister Anthony Albanese said was a routine maritime surveillance operation.

China’s Defense Ministry told Australia to stop “provocations” or face “serious consequences.”

Beijing is testing the new Australian prime minister.

North Korea: Pyongyang test-fired a barrage of short-range ballistic missiles from multiple locations toward the sea on Sunday, South Korea’s military said, extending a provocative streak in weapons demonstrations this year that U.S. and South Korean officials say may culminate with a nuclear test explosion at any moment.

The eight missiles fired may have been a record for North Korean ballistic launches.  South Korea’s Joint Chiefs of Staff said the missiles, fired in succession over 35 minutes, flew 68 to 416 miles at maximum altitudes of 15 to 56 miles.  Some of the missiles failed to reach their objectives (which the North then learns from).

Hours later, Japan and the U.S. conducted a joint ballistic missile exercise aimed at showing their “rapid response capability” and “strong determination” to counter threats, Japan’s Defense Ministry said in a statement.

The U.S. and South Korea then fired eight surface-to-surface missiles on Monday.  Per a statement from South Korea’s army, the joint exercise was meant to demonstrate “the capability and readiness to carry out precision strikes.”

Tuesday, the South Korean and U.S. militaries flew 20 fighter jets over South Korea’s western sea.

Wednesday, officials from South Korea, the U.S. and Japan issued a statement that North Korea’s missile tests were “serious, unlawful” provocations, as they urged Pyongyang to return to dialogue and accept help to tackle Covid-19.  The senior foreign policy officials from all three met in Seoul. 

The three urged the North in a statement to abide by international sanctions and immediately cease actions that “escalate tensions or destabilize the region.”  They also pledged to ramp up their security cooperation to meet the North’s threats, with Deputy Secretary of State Wendy Sherman reaffirming U.S. defense commitments, including “extended deterrence,” or the ability of the U.S. military, particularly with its nuclear forces, to deter attacks on allies.

Separately, the United States on Wednesday questioned whether China and Russia had elevated their “no limits” strategic partnership above the safety and security of the world by vetoing more UN sanctions on North Korea over its renewed ballistic missile launches.  “We hope these vetoes are not a reflection of that partnership,” senior U.S. diplomat Jeffrey DeLaurentis told a meeting of the General Assembly in response to the vetoes in the Security Council two weeks ago.

“Their explanations for exercising the veto were insufficient, not credible and not convincing. The vetoes were not deployed to serve our collective safety and security,” said DeLaurentis, addressing the assembly after China and Russia.

Iran: On Monday, International Atomic Energy Agency Director-General Rafael Grossi declared that not only had Iran failed to reduce concerns about the nuclear violations of its nonproliferation safeguards agreement, but also that Iran will eventually cross the nuclear uranium enrichment threshold.

He added that “having a significant quantity does not mean having a bomb,” but then said “this idea of crossing the line, it’s going to happen. They are very close,” and “it cannot be avoided.”

Grossi, when questioned if this meant the situation could not be salvaged, said, “Iran can stop, through negotiations, or they themselves can decide to slow down” unilaterally.

Even after crossing the uranium weaponization threshold, Grossi said, Tehran would need to master detonation and delivery issues which could take six months to two years, before being able to fire a nuclear weapon on a missile.

Wednesday then started out with the story that Iran had removed two surveillance cameras of the IAEA from one of its nuclear facilities, state TV reported, in a move that clearly raised tensions with the UN nuclear watchdog.

The IAEA then said Iran has begun installing advanced IR-6 centrifuges in one cluster at an underground enrichment plant at Natanz in line with a plan announced long ago but it now also intends to add two more such clusters, or cascades.

“On 6 June 2022, the Agency verified…that Iran had started to install IR-6 centrifuges in the aforementioned single cascade previously declared by Iran to the Agency,” the IAEA said in a report to member states.  The installation of the two extra clusters had yet to begin.

The United States then said it would be regrettable and counterproductive for Iran to remove two of the IAEA’s surveillance cameras, as the U.S. pushed for a resolution criticizing Iran at the watchdog’s board.

“If accurate, reports that Iran plans to reduce transparency in response to this resolution are extremely regrettable and counterproductive to the diplomatic outcome we seek,” a U.S. statement to a meeting of the 35-nation Board of Governors said ahead of a vote on the U.S.-backed draft resolution.  “We do not seek escalation (with Iran).”

The IAEA’s board then overwhelmingly passed a resolution criticizing Iran for failing to explain uranium traces found at three undeclared sites at a closed-door meeting Wednesday.  Only two countries, Russia and China, opposed the text while 30 voted in favor and three abstained.  The text says the board “expresses profound concern” the traces remain unexplained due to insufficient cooperation by Iran and calls on Iran to engage with the watchdog “without delay.”

Thursday, Iran told the IAEA it plans to disconnect 27 IAEA surveillance cameras and other monitoring equipment, Rafael Grossi told its board.  Iran’s move appeared to be further retaliation for the above resolution.

Grossi said the move to essentially remove all of the IAEA’s monitoring equipment installed under the 2015 nuclear accord was a near-fatal blow to chances of reviving it.

Grossi said Iran’s move leaves a window of opportunity of three to four weeks to restore at least some of the monitoring that is being scrapped, or the IAEA will lose the ability to piece together Iran’s most important nuclear activities.

“You think we would retreat from our positions if you pass a resolution at the (IAEA) Board of Governors?  In the name of God and the great nation of Iran, we will not back off a single step from our positions,” Iranian President Ebrahim Raisi said in a speech.

Since then-President Trump pulled out of the nuclear deal and re-imposed sanctions against Tehran in 2018, Iran has breached many of the deal’s limits on its nuclear activities.  It is enriching uranium to close to weapons-grade. Western powers warn it is getting closer to being able to sprint towards making a nuclear bomb.

Iran has been keeping the data recorded by the extra monitoring equipment since February of last year, meaning the IAEA can only hope to access it at a later date.  Grossi said it was not clear what would happen to that data now.  There are some 40 other cameras operating as part of the core monitoring in Iran that predates the 2015 deal, but of what value these now are hasn’t been discussed.

Separately, on Tuesday, Iran’s regular army ground forces’ commander was quoted by Tasnim news agency as saying that Iran will raze the cities of Tel Aviv and Haifa should Israel make any mistake.

“For any mistake made by the enemy, we will raze Tel Aviv and Haifa to the ground by the order of the Supreme Leader,” Kiumars Heydari said.

Random Musings

--Presidential approval ratings….

Gallup: 41% of President Biden’s job performance, 54% disapprove; 39% of independents approve (May 2-22).

Rasmussen: 39% approve of Biden’s performance, 59% disapprove (June 10).

The above-mentioned Quinnipiac University national poll has President Biden’s approval rating at a putrid 33% (tying a low), 55% disapproval (12% not offering an opinion).  Only 25% of independents approve.

The survey, conducted June 3-6, found that 22% of Americans ages 18-34 approve of Biden’s performance – the lowest rating of any age group.  Just 24% of Hispanic voters and 49% of black voters said they approve of Biden’s work.

Among registered voters, if the election were held today, 46% say they would want to see the Republican Party win control of the House, while 41% say the Democratic Party, and 13% had no opinion.

--For the record, former hedge-fund executive David McCormick conceded last Friday in Pennsylvania’s Republican Senate primary, McCormick trailing celebrity doctor Mehmet Oz by 1,000 votes in their recount…31.2% to 31.1%.  As I posted on Thursday last time, just wanted this tidbit in the archives.  McCormick said Oz has his full support in the general election against Democratic nominee, Lt. Gov. John Fetterman.  This will be one of the 2 or 3 real high-profile races in what is now a 50-50 Senate.

Fetterman suffered a stroke on May 13 and conceded that his condition was worse than his campaign let on.  He said he avoided going to the doctor, “even though I knew I didn’t feel well.  As a result, I almost died.”  He said he takes his health more seriously now.

“Back in 2017, I had swollen feet and went to the hospital to get checked out.  That’s when I learned I had a heart condition.  Then, I didn’t follow up.  I thought losing weight and exercising would be enough.  Of course it wasn’t,” Fetterman said.

All eyes will be on Fetterman in terms of how vigorous a campaign he is able to conduct, having a pacemaker with a defibrillator implanted due to cardiomyopathy, which makes it harder for the heart to pump blood.

And his campaign, which wasn’t truthful when Fetterman first suffered the stroke, claiming the heart procedure was in essence no big deal, better be more transparent regarding his condition going forward. 

He has yet to be at a public appearance since.

--Voters in California signaled their unhappiness over crime rates, ousting a progressive district attorney in San Francisco and backing in large numbers a billionaire property developer who promised he could “clean up” Los Angeles in Tuesday’s elections.

Chesa Boudin was removed after 2 ½ years in office as district attorney in a recall election in San Francisco.  The guy was elected in 2019 with a promise to put in place criminal justice reforms aimed at keeping low level offenders out of prison and spare young people from long jail sentences.  He also moved to eliminate cash bail and pledged to hold police in the city accountable for their actions.

But then he was rightfully blamed for a rise in murders, shootings and property crimes, appearing to back perpetrators of crimes more than victims, and it was a case of Democratic Party leaders in the city moving further left than their voters.

In Los Angeles’ mayoral race, concerns of voters also focused on public safety and homelessness.

Enter Rick Caruso, a billionaire real estate developer, who will now face Karen Bass, a longtime Democratic congresswoman, in a run-off in November, neither candidate earning more than 50 percent of the primary vote.

Bass was once on Joe Biden’s short list for running mate and was widely seen as the frontrunner in the crowded primary field before Caruso entered the race earlier in the year.

Caruso spent $39 million of his own money on television, digital and radio ads – portraying himself as a successful businessman who could “clean up” L.A.  He’s a former Republican who only switched to become a Democrat this year.  He has promised to hire 1,500 more police officers and build 30,000 shelter beds in 300 days. Clearly the message resonated with voters who are tired of the growing homeless issue.

--Meanwhile, in Iowa, Sen. Charles Grassley easily beat off a challenger in the Republican primary, with Grassley set to win his eighth term in the Senate in November.  The guy is 88 now, and would be 95 at the end of his next term in office.

--In her opening statement at the House select committee’s first primetime hearing on the Jan. 6, 2021 riot, Wyoming Republican Rep. Liz Cheney alleged Thursday that then-President Donald Trump said that Vice President Mike Pence “deserves” to be hanged as Trump supporters chanted “hang Mike Pence.”

“You will hear that President Trump was yelling and ‘really angry’ at advisers who told him he needed to be doing something more,” Cheney said, “and – aware of the rioters’ chants to hang Mike Pence – the president responded with this sentiment, quote: ‘Maybe our supporters have the right idea.’  Mike Pence, quote, ‘deserves it.’”

Cheney also claimed that “over multiple months, Donald Trump oversaw and coordinated a sophisticated seven-part plan to overturn the [2020] presidential election and prevent the transfer of presidential power. In our hearings, you will see evidence of each element of this plan.”

“On the morning of January 6, President Donald Trump’s intention was to remain the president of the United States, despite the lawful outcome of the 2020 election.  And in violation of his constitutional obligation to relinquish power,” Cheney noted.

But Cheney’s big line was reserved for members of her party who have stood by Trump.

“I say this to my Republican colleagues who are defending the indefensible: There will come a day when Donald Trump is gone, but your dishonor will remain.”

Separately, a video deposition was shown of former Atty. Gen. William Barr saying that he told Trump he didn’t agree with his assertion of voter fraud, and that after election day he spoke with the president three times on the matter.  Barr said he “made it clear I did not agree with the idea of saying the election was stolen and putting out this stuff, which I told the president was bullshit.”  Barr said he “didn’t want to be a part of it” and said the rhetoric was partly why he left the job.

“You can’t live in a world where the incumbent administration stays in power based on its view, unsupported by specific evidence…that there was fraud in the election,” Barr said.

For his part, Trump wrote on his Truth Social platform Thursday night:

“January 6th was not simply a protest, it represented the greatest movement in the history of our Country to Make America Great Again.  It was about an Election that was Rigged and Stolen, and a country that was about to go to HELL.”

Round Two of the public hearings next week.  Some 19 million+ tuned in on Thursday, according to reports.

--This past weekend, Friday to Sunday, at least 17 people were killed in a series of mass shootings across America…Philadelphia; Chattanooga; Saginaw, Michigan; Omaha; and other towns and cities…at least a dozen shootings that killed or injured four or more people, which qualifies for the Gun Violence Archive.  At least 82 were wounded or killed.

As of last weekend, there had been at least 245 mass shootings this year.  Last year there were 692; the highest number since 2014.

Actor Matthew McConaughey, who was born in Uvalde, Texas, made an emotional appearance at the White House briefing room on Tuesday.  I just happened to be watching cable then and caught what was a terrific speech for greater gun control measures.

McConaughey invoked the memory of the 19 children who were murdered last month.

“How,” he asked, “can we make the loss of these lives matter?”

The actor called for the same kinds of measures that many Democrats, and a few Republicans, support…such as background checks, but did so with a passion seldom seen in Washington.

He described visiting his grieving hometown, the latest in an ever-growing onslaught against American communities.  “You could feel the pain, the denial, the disillusion, anger, blame, sadness, loss of lives, dreams halted,’ he said.

Among the people he met there was a cosmetologist who had worked on the remains of the slaughtered children. “They needed extensive restoration.  Why?  Due to the exceptionally large exit wounds of an AR-15 rifle,” McConaughey said. 

At one point in his briefing, McConaughey’s wife held up a pair of green sneakers that were like those worn by 10-year-old Matie Rodriguez, one of the victims, and McConaughey pounded the podium before him.

“These are the same green Converse on her feet that turned out to be the only clear evidence that could identify her after the shooting,” he said, his voice cracking with emotion.

“We can’t truly be leaders if we are only living for reelection,” McConaughey said, a reference to the power of the gun lobby.  Last week, Rep. Chris Jacobs, a Republican from upstate New York, said he would not run for reelection after facing backlash for voicing support for gun control.

McConaughey, a gun owner, said: “American gun owners are fed up with the Second Amendment being hijacked by some deranged individuals.”  But he expressed optimism over the talks being led in the Senate by Chris Murphy (D-Conn.) and John Cornyn (R-Tex.).

Editorial / New York Post

“Matthew McConaughey’s speech at the White House was strikingly different from the usual ‘Hollywood star lectures America’ dribble: This was humble, moving and truly personal.

“Uvalde is the actor’s hometown; it was the horror there that compelled him first to write for his local paper (reaching out to fellow Texans first) and then to accept the invite to speak to the nation.

“His message: He and other responsible gun owners are ‘fed up with the Second Amendment being abused and hijacked by deranged individuals’ like the Uvalde shooter.  ‘We need responsible gun ownership,’ he said.  ‘We need background checks, we need to raise the minimum age to purchase an AR-15 rifle to 21, we need a waiting period for those rifles, we need red flag laws and consequences for those who abuse them.’

“That is, ‘We need to restore our American values.’  And such changes would be ‘a step forward for a civil society and the Second Amendment.’

“Hear, hear.

“He didn’t pretend to offer a ‘cure-all (Hell, no).  But people are hurting, families are, parents are.’….

“Congress is prepping bipartisan gun legislation now… McConaughey just made that a bit more likely.

“This was a star using his fame in true public service.”

Later Tuesday, I thought I had to catch the opening of “Hannity” on Fox News to see how he treated McConaughey’s appearance.  Hannity was very thoughtful and complementary of him.  He made it clear McConaughey’s appearance at the White House was sincere.

So then Hannity turned to Dan Bongino and Geraldo.  Understand, I despise Bongino.  So he dissed Hannity’s ‘fair and balanced’ approach with a dismissive “He’s an actor,” and kept repeating that theme.  The camera didn’t show Hannity’s face, but Geraldo was exasperated.

I wanted to scream, among other things, ‘Ronald Reagan was an actor, you phony [jerk]!’

Earlier, Sen. Josh Hawley (R-Mo.), who wrote the book on ‘phony,’ said he was against red flag laws because they infringe on the Second Amendment rights of those who haven’t committed a crime.

The Buffalo and Uvalde shooters hadn’t committed a prior crime! Instead, they acted out on social media, the Uvalde shooter viciously so but not to friends and family, rather strangers.  The Buffalo shooter to the point police had interviewed him before and decided they hadn’t seen enough to consider him a present danger.

As in note to Sen. Hawley.  Red flag laws aren’t a panacea, but they can help and I for one couldn’t give a damn about someone’s Second Amendment rights when it comes to doing simple investigating to prevent a mass shooting.

Call it ‘red flag’ or not, but local officials and the FBI probably stopped a mass shooting in Casa Grande, Arizona this week.  A 19-year-old was arrested for allegedly threatening to shoot up the high school, police station and movie theater.  What say you, Senator Hawley, the bold one who held up that clenched fist of support to the insurrectionists on Jan. 6?

According to a CBS News/YouGov poll, 44% of Republicans said that mass shootings are something we have to accept as part of a free society, vs. 56% who say mass shootings can be prevented or stopped if we really tried.

Nationwide, more than 7 in 10 Americans (72%) said that mass shooting could be prevented if we really tried, while just 28% said they were part of a living in a free society.

A survey from NPR/PBS NewsHour/Marist has a majority of Americans saying “it’s more important to control gun violence than to protect gun rights,” 59% to 35%.  But 92% of Democrats and 54% of independents prefer efforts to control gun violence, while 70% of Republicans favor gun rights.

A Quinnipiac poll has 74% of Americans supporting raising the minimum legal age to buy any gun to 21, 24% not supporting such a measure.  By a 57-38 margin, Americans support stricter gun laws.  By 83-12, they support a “red flag” law.

--House lawmakers passed a bill that had a number of reforms to address the school shootings, such as raising the legal age to buy certain semiautomatic rifles from 18 to 21 years old, establish new federal offenses for gun trafficking and for selling large-capacity magazine.

But the legislation, which passed along party lines, 223-204 (five Republicans voting for the changes, two Democrats voting against) has zero chance of making it through the Senate.

--According to new evidence, Uvalde police chief Pete Arredondo and others at the scene became aware that not everyone inside the classrooms was already dead, documents showed, including a report from a school district police officer whose wife, a teacher, had spoken to him by phone from one of the classrooms to say she had been shot.

More than a dozen of the 33 children and three teachers originally in the two classrooms remained alive during the 1 hour and 17 minutes from the time the shooting began inside the classrooms to when four officers made entry, law enforcement investigators have concluded.

“People are going to ask why we’re taking so long,” a man who investigators believe to be Chief Arredondo could be heard saying, according to a transcript of officers’ body camera footage.  “We’re trying to preserve the rest of the life.”

In a new interview with the Texas Tribune, Arredondo said a hard-to-find key to a locked classroom door was the ultimate reason police waited 77 minutes to enter a classroom to kill the gunman.  Arredondo defended the delayed response.

“Not a single responding officer ever hesitated, even for a moment, to put themselves at risk to save the children,” he told the newspaper.  “We responded to the information that we had and had to adjust to whatever we faced.”

He said the door to the classroom had a steel jamb and could not be kicked in.

--The arrest of an armed man outside Supreme Court Justice Brett Kavanaugh’s Maryland home Wednesday has underscored the potential threats to the justices in the heated final weeks of their judicial session and an upcoming ruling on abortion, all of which heightens calls for legislation to protect them and their families.

The Senate passed a bill last month for expanding security protection to the immediate family  members of Supreme Court justices, but the House, pathetically, won’t do so until next week.  House Democrats blocked an effort this week by House Republicans to pass the bill by unanimous consent.

After protests surfaced at the homes of the justices weeks ago, Attorney General Merrick Garland said the U.S. Marshals Service would provide “around-the-clock security” at the justices’ homes and that helped lead to the arrest of the would-be assassin.

--In an Associated Press-NORC Center for Public Affairs Research survey of American Catholics, conducted in mid-May, there’s a clear gap between the prevalent views of us (me being a Catholic) and them (the church’s bishops).

According to the poll, 63% of Catholic adults say abortion should be legal in all or most cases, and 68% say Roe should be left as is.

On May 20, the archbishop of San Francisco, Salvatore Cordileone, announced that he will no longer allow U.S. House Speaker Nancy Pelosi (D-San Francisco) to receive Communion because of her support for abortion rights.

According to the poll, only 31% of lay Catholics agree that politicians supporting abortion rights should be denied Communion, while 66% say they should be allowed access to the sacrament.

An even larger majority – 77% - said that Catholics who identify as LGBT should be allowed to receive Communion.  That contrasts sharply with a policy issued by the Diocese of Marquette, which encompasses Michigan’s Upper Peninsula, saying pastors should deny Communion to transgender, gay and nonbinary Catholics “unless the person has repented.”

Among the challenges facing the church, 68% of Catholics reported attending religious services once a month or less.  Compared with five years ago, 37% said they were now attending less often; 14% said they were attending more often.

--Pope Francis added fuel to rumors he may soon resign by announcing he would visit the central Italian city of L’Aquila in August for a feast initiated by Pope Celestine V, one of the few pontiffs who resigned before Pope Benedict XI stepped down in 2013.

Italian and Catholic media have been rife with unsourced speculation that the 85-year-old Francis, suffering from severe mobility issue that have forced him to use a wheelchair for the last month, might be following in Benedict’s footsteps.

The rumors gained steam last week when Francis announced a consistory to create 21 new cardinals scheduled for Aug. 27. Sixteen of them are under age 80 and eligible to vote in a conclave to elect Francis’ successor.

Once they are added to the ranks of princes of the church, Francis will have stacked the College of Cardinals with 83 of the 132 voting-age cardinals, thus increasing the odds that a successor will share Francis’ pastoral priorities.

The basilica in L’Aquila hosts the tomb of Celestine V, a hermit pope who resigned after five months in 1294, overwhelmed by the job.  Benedict visited L’Aquila in 2009, after a devastating earthquake, and prayed at Celestine’s tomb, leaving a vestment unique to the pope on it.  No one seemed to grasp the significance of the gesture…and maybe it didn’t really mean anything at the time, but I don’t have Benedict’s phone number and can’t ask him directly.  If I did have it….

“Bene?  S’up?  It’s Brian…yeah, the largely lapsed one from Jersey.  Say, about that pallium you left on Celestine’s tomb…. What?  It didn’t mean anything?  OK…thanks.  The grapes good there?  Super…well take care.”

By the way, some Vatican watchers don’t think Francis would resign until Benedict, 95, dies.

--Queen Elizabeth said she was humbled by the support she received last weekend during her Platinum Jubilee, with huge throngs cheering her final appearance on the balcony at Buckingham Palace, flanked by her heir Prince Charles and two other future kings.

“I have been humbled and deeply touched that so many people have taken to the streets to celebrate my Platinum Jubilee.  While I may not have attended every event in person, my heart has been with you all; and I remain committed to serving you to the best of my ability, supported by my family.”

The 96-year-old was forced to skip some events because of her “episodic mobility issues.”

It was terrific to see millions of Brits, with their diverse communities, party and celebrate and come together as one for at least a few days.  No major incidents…all good.

Alas, Charles, ever the jerk, will hang on as long as he can and thus deny William the crown while he is young and vibrant and we’ll have to deal with the dullard, as the monarchy’s importance, including, critically, for tourism, wanes.  Only a King William, taking over the day Elizabeth died, would keep the monarchy energized and the public interested (and willing to pay for it all through the general coffers).

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Pray for the men and women of our armed forces…and all the fallen, including the five Marines killed in an Osprey training accident near San Diego.

Pray for Ukraine.

God bless America.

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Gold $1875
Oil $120.49

Returns for the week 6/6-6/10

Dow Jones  -4.6%  [31392]
S&P 500  -5.1%  [3900]
S&P MidCap  -4.7%
Russell 2000  -4.4%
Nasdaq  -5.6%  [11340]

Returns for the period 1/1/22-6/10/22

Dow Jones  -13.6%
S&P 500  -18.2%%
S&P MidCap  -15.4%
Russell 2000  -19.8%
Nasdaq  -27.5%

Bulls  35.7
Bears 40.0

Hang in there.

Brian Trumbore

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