Week in Review

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Week in Review

07/15/2023

For the week 7/10-7/14

[Posted 5:30 PM ET, Friday]

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Edition 1,265

This week UN Secretary General Antonio Guterres declared that the world’s “climate is out of control,” and even if you are a climate change denier, you have to accept some facts.  It’s not just one or two selected spots, it being summer in the northern hemisphere, it’s all over, as I detail at the end of this column.  Check out where Fort Good Hope, in Canada’s Northwest Territories, and the Arctic Circle, is.  Then find out below how hot, yes, ‘hot,’ it got last weekend.

Ironically, here in New Jersey, we had a cooler than average May and June, and it’s only the past week where real summer weather has set in, with lots of humidity as I discovered in my near-daily outdoor exercise sessions.

It's virtually everywhere else, it seems, that it’s been beyond brutal, and in many cases life-threatening.  Scores will die in southern Europe this weekend, for example.  And then there is the extreme rainfall, again, all over the globe, detailed below.

But what I find most distressing, for today, are the water temperatures.  In the 90s off much of Florida, which even a second-grader knows is jet fuel for a tropical storm, and flat-out destructive of the marine environment.

Off New Jersey, this week the water temps are 76-79, when we don’t normally see such temperatures until early September, if at all.  And it’s July 14.

To all those in the Southwest, and the Deep South, you have my sympathy.  For all of us, if this is even close to the new norm, the economic consequences could be mammoth.  For starters, our Power Grid will collapse, as folks in Texas are no doubt concerned with today.

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I try to divide up the Ukraine coverage between what actually happened in Ukraine as to the war, and events in Vilnius, Lithuania, site of the consequential NATO summit. So….

This Week in Ukraine….

--At the 500-day mark of the war last weekend, British Defense Minister Ben Wallace said in a statement: “Let’s not forget what’s at stake.  The people of Ukraine are fighting not just to repel an illegal invasion on their sovereign soil, but for every citizen of Europe and the world who believes in the values of freedom and democracy, their fight is our fight.”

--President Volodymyr Zelensky marked the 500th day with a video of himself visiting Snake Island, a strip of land in the Black Sea that has become a potent symbol of his country’s resistance to the invasion, a middle finger to Russia for the ages.  He paid tribute to all those who have lost their lives.

“I want to thank you from here, from this place of victory, each of our soldiers for these 500 days.”

Zelensky said that the retaking of the island “is a great proof that Ukraine will regain every bit of its territory.”

“Let the freedom that all our heroes of different times wanted for Ukraine and that must be won right now be a tribute to all those who gave their lives for Ukraine,” the president said.  “We will definitely win!”

--The British military says Russia has suffered an average of 400 casualties every day for the past 17 months in Ukraine.  That is “almost certainly” feeding “a crisis of combat medical provision” for Russia’s occupying forces. And that, in turn, has “likely undermined the normal provision of some Russian civilian medical services, especially in border regions near Ukraine,” the Brits said Monday.

“Very slow casualty evacuation, combined with the inappropriate use of the crude in-service Russian combat tourniquet is reportedly a leading cause of preventable fatalities and amputations,” the Brits allege.

--The Associated Press reported, citing independent Russian media outlets, Mediazona and Meduza, who teamed up with a researcher from Germany’s Tubingen University, nearly 50,000 Russians are believed to have died inside Ukraine so far.

Russian officials have acknowledged only about 6,000 deaths. But the researchers analyzed “inheritance records and official mortality data” to estimate “how many more men under age 50 died between February 2022 and May 2023 than normal,” according to the AP.

--President Zelensky returned from a visit to Turkey on Saturday, bringing home five former commanders of Ukraine’s garrison in Mariupol despite a prisoner exchange last year under which the men were meant to remain in Turkey.

Russia immediately denounced the release of the men.  Kremlin spokesman Dmitry Peskov said Turkey had violated the prisoner exchange terms and had failed to inform Moscow.

The commanders, lionized as heroes in Ukraine, led last year’s defense of the port, the biggest city Russia captured in its invasion.

Thousands of civilians were killed inside Mariupol when Russian forces laid the city to waste during a three-month siege.

The Ukrainian defenders held out in tunnels and bunkers under the Azovstal steel plant, until they were finally ordered by Kyiv to surrender in May last year.

Moscow freed some of them in September in a prisoner swap brokered by Ankara, under terms that required the commanders to remain in Turkey until the end of the war.

Ukrainians hailed the news of their release.

--President Zelensky, appearing in an interview last weekend with ABC News, said he sees an opening to end the war.  Hopefully by the fall, he said, Ukrainian troops “will reach the administrative border with a temporarily occupied Ukrainian Peninsula, Crimea,” at which point “it’s very likely that Putin will be forced to seek dialogue with the civilized world, unlike it was before the full-scale invasion,” Zelensky told Martha Raddatz.

“Six months ago, you said you would not cede any territory to Russia to end this war,” Raddatz said.  “We’re now 16 months in.  Is your answer the same?”  “Yes,” Zelensky replied.  “No territory.  Crimea is our territory.”

--Russian forces launched a deadly strike on the eastern Ukrainian city of Lyman on Saturday morning, killing at least eight civilians and wounding 15 others as Russian forces shelled a residential area of the city at around 10:00 a.m., Ukraine’s Interior Ministry said in a statement.

--President Vladimir Putin held Kremlin talks with Yevgeny Prigozhin days after denouncing an armed mutiny he had led as treasonous, Putin’s spokesman said on Monday, as Russia’s top general also resurfaced for the first time.

Spokesman Dmitry Peskov said the meeting with Prigozhin was held on June 29, five days after the aborted mutiny.  Much of what happened on June 24, the day of the mutiny, and how the authorities are handling its aftermath remains unclear.

One of the biggest mysteries is why Prigozhin does not seem to have fulfilled the terms of the deal which ended the standoff, what his future plans are, as well as those of his fighters, and why he does not appear to have been punished by the Kremlin.  The fact that Prigozhin and his top field commanders sat down with Putin in the Kremlin days after the Russian leader called their actions a treasonous “stab in the back” which could have pushed Russia into a chaotic civil war is raising even more questions about what is going on behind the scenes.

Peskov told reporters that Putin had invited 35 people to the three-hour meeting, including Prigozhin and his Wagner unit field commanders.

“The only thing we can say is that the president gave his assessment of the company’s (Wagner’s) actions at the front during the Special Military Operation (in Ukraine) and also gave his assessment of the events of 24 June (the day of the mutiny),” Peskov said.  He said Putin had listened to the commanders’ own explanations of what had happened and had offered them further options for employment and combat.  Peskov said Wagner commanders had reaffirmed their loyalty to Putin at the Kremlin meeting.

“They (the commanders) emphasized that they are staunch supporters and soldiers of the head of state and the supreme commander-in-chief. They also said that they are ready to continue fighting for the Motherland,” said Peskov.

Meanwhile, footage released by the defense ministry Monday but apparently shot a day earlier, showed Chief of the General Staff Valery Gerasimov, in his first public appearance since the mutiny.  The footage indicates that Putin has for now kept his top two generals, Gerasimov and Defense Minister Sergei Shoigu.  The third key general, Sergei Surovikin, has reportedly been detained for questioning, but this is just a rumor.

For months before the mutiny, Prigozhin had been openly insulting Gerasimov and Shoigu, using a variety of crude expletives that shocked top Russian officials but went unanswered by Putin in public.  Prigozhin had said Putin’s top military men would be forced to eat the guts of fallen soldiers in hell for what he alleged was the incompetent and treasonous way they were running the war. Prigozhin, just before the mutiny, had even dissected the Russian justification for the war and accused the defense ministry of lying to Putin about both the causes and conduct of the war.

--According to a Reuters exclusive interview with the head of Ukraine’s military intelligence, Kyrylo Budanov, as rebellious Wagner forces drove north toward Moscow on June 24, a contingent of military vehicles split off in the direction of a fortified Russian army base that holds nuclear weapons, according to video posted online and interviews with local residents.  Budanov said that fighters reached the nuclear base and that their intention was to acquire small Soviet-era nuclear devices to “raise the stakes” in their mutiny.

--Russia launched attacks on Kyiv, the Black Sea port of Odesa and the southern region of Kherson on Tuesday before the start of the NATO summit in Lithuania where security threats from Moscow were on the agenda.  No deaths were reported in the strikes on Kyiv and Odesa, but Russian shelling killed a woman in the southern village of Sofiivka and wounded two people in Kherson.  The air force said 26 of the 28 kamikaze Iranian-made Shahed drones were shot down.

--NATO leaders in Vilnius, Lithuania, have invited Ukraine to join the military alliance “when the Allies agree and conditions are met,” NATO Secretary General Jens Stoltenberg told reporters Tuesday.  Stoltenberg’s comments came after President Zelensky had criticized NATO leaders.  In a tweet, he said, “wording is being discussed without Ukraine” that gives little clarity on his country’s prospects for joining the bloc, in apparent reference to a draft text that had been circulated.  Kyiv wants specific pledges on when and how it can join the defense alliance.

Though Stoltenberg said Tuesday that NATO was “sending a message to Ukraine, which is stronger than any message NATO has ever sent before, on membership for Ukraine,” Zelensky said any language that did not include a time frame for Ukraine becoming a member of NATO would be “absurd.”

The U.S. delegation was furious with Zelensky’s tweet.

But after criticizing NATO leaders earlier in the day and declaring that “uncertainty is weakness,” Zelensky attended a rally in Vilnius and put a more hopeful spin on his campaign for NATO membership.

“Thank you for your help to our defense and for your clear, honest and courageous position on inviting Ukraine to NATO,” he told the crowd. “Ukrainian flags on Lithuanian streets clearly prove that we are already allies, and Ukraine will defend both its own and your freedom!”

He added: “Today I embarked on a trip here with faith in decisions, with faith in partners, with faith in a strong NATO.  In a NATO that does not hesitate, does not waste time and does not look back at any aggressor. …And I would like this faith to become confidence – confidence in the decisions that we deserve – all of us deserve, and every warrior, every citizen, every mother, every child expects.  And is that too much to expect?”

Wednesday, Zelensky said the results of the summit were good, but would have been ideal if there had been an invitation for Kyiv to join the alliance.  Zelensky said NATO’s recognition that Ukraine did not need to follow a Membership Action Plan was important, and that he had received positive news on defense packages announced during the summit.

--The Russian Defense Ministry said on Wednesday that the Wagner mercenary group is completing its handover of weapons to Russia’s regular armed forces.  In a statement accompanied by video showing tanks, rockets and other heavy weapons, the ministry said Wagner had transferred more than 2,000 pieces of equipment and over 2,500 tons of ammunition.  If genuine, the handover is the most concrete sign to date that Wagner is pulling out of combat operations.

Much remains unclear about the implementation of the agreement whereby Wagner fighters were given the option of joining Prigozhin in exile, joining Russia’s regular forces or going home.  Even after the Kremlin talked about a June 29 meeting with Prigozhin, his whereabouts remain unknown at the end of the week.  Flight-tracking data showed a plane linked to Prigozhin leaving Moscow on Tuesday and heading towards Belarus, but it was not clear if he was on board.

--Ukrainian anti-aircraft units engaged attacking drones for the third consecutive night in and around Kyiv on Thursday, triggering fires and falling debris in several districts and killing at least one person, official said.

The head of Kyiv’s military administration, Serhiy Popko, described the assault as a “mass attack” by Iranian-made Shahed drones that had approached from different directions.  “Anti-aircraft forces identified and destroyed about 10 foreign targets.”  Overall, 20 drones were fired by Russian forces Thursday.  The Ukrainian military said it also intercepted two Russian cruise missiles, but one ballistic missile was not intercepted, although it did not explain what damage the missile caused.

[Twenty-four hours earlier, Ukraine shot down 11 of 15 Iranian-made drones fired by Russia.  A man was killed in shelling of the southern city of Kherson.]

With explosions resounding in the capital and other regional centers more than 500 days into Russia’s invasion, military officials said Ukrainian forces were making progress with their counteroffensive on front lines in the east and south. These included gains near the shattered city of Bakhmut captured by Russian forces in May after months of battles.

--Defense One reported France has begun delivering cruise missiles to Ukraine, weapons with the kind of range that the Biden administration has so far resisted sending.

“Deliveries have been going on for some time, so it has been anticipated,” said Laurent Bill, France’s ambassador to the United States, at an event on Wednesday.

Bill spoke one day after French President Emmanuel Macron announced more vaguely that he had approved the transfer of deep-strike munitions.

--Thursday, Joint Chiefs Chairman Army Gen. Mark Milley said Russia is suffering from “a significant amount of friction and confusion” since the mutiny, Milley told reporters during a trip to Asia.  “There’s a lot of drama going on at the very senior levels.  How that’s all going to play out at the end of the day, I’m not so sure yet,” he said.  “I don’t think we’re done with it. I think there’s many more chapters to be heard on that.”

--A top Russian general says he has been removed from his post in Ukraine after telling military chiefs the truth about the dire situation on the front line.

Maj. Gen. Ivan Popov was the commander of the 58th Army, which has been fighting in the southern Zaporizhzhia region.

In a voice message, Popov said he raised questions about high casualty rates and lack of artillery support.

“It was necessary either to keep quiet and be a coward or to say it the way it is,” he said.  “I had no right to lie in the name of you, in the name of my fallen comrades in arms, so I outlined all the problems which exist.”

The message was posted to Telegram by Russian MP Andrei Gurulyov, who is a former military commander and frequent commentator on state TV.  It is unclear when the message was recorded.

The commander said his dismissal was demanded by senior commanders – who he accused of treason – and approved by the Russian defense minister, Sergei Shoigu.  Russian military bloggers – often the most insightful form of information in the absence of official comment from Moscow – reported that the orders to dismiss Maj. Gen. Popov had come from the head of Russia’s armed forces, Gen. Valery Gerasimov.

Separately, a former Russian commander who has not been seen in public since the Wagner mutiny, Gen. Sergei Surovikin, is “resting,” according to a senior MP in Moscow’s parliament.

Andrei Kartapolov, chair of the defense committee, said Surovikin was “not reachable.”

And another senior Russian general – Lt. Gen. Oleg Tsokov – is said to have been killed in a strike in Ukraine’s occupied south coast this week, although his death has not been officially confirmed by Russia’s defense ministry.

--Today, Friday, Belarus said that fighters from the Wagner Group were instructing its soldiers at a military range southeast of Minsk, the first indication that at least part of a deal to end the mutiny may be being implemented.  Reuters learned from two sources that some Wagner fighters have been in Belarus since Tuesday.

Belarus then late in the day said it had reached an agreement with Wagner to train its troops in the near term.  The defense ministry and “company’s management have developed a roadmap for the near future for training and transfer of experience between units of different branches of the armed forces,” according to a statement published by the ministry, which provided no further details but said it would continue to keep the public informed “about the upcoming work.”

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--Turkish President Tayyip Erdogan, in an unexpected move, said on Monday the European Union should open the way for Ankara’s accession to the bloc before Turkey’s parliament approves Sweden’s bid to join the NATO military alliance.  Turkey’s bid to join the EU has been frozen for years after membership talks were launched in 2005 under Erdogan’s first term as prime minister.

The ties between the EU and Turkey soured years ago, especially after a failed 2016 coup attempt in Turkey, but have since improved.  The bloc depends on Turkey’s help, particularly on migration.

As he departed for the NATO summit in Vilnius, Erdogan said: “I am calling from here on these countries that are making Turkey wait at the door of the European Union for more than 50 years.  First, come and open the way for Turkey at the European Union and then we will open the way for Sweden, just as we did for Finland,” he said.

Ankara maintains Sweden has not done enough against people Turkey sees as terrorists, mainly members of the outlawed Kurdistan Workers Party (PKK) that is considered a terrorist organization by Turkey, the EU and the United States.  Erdogan also said that an end to the war between Ukraine and Russia would ease Kyiv’s NATO membership process.

So then, suddenly, Erdogan agreed to forward to parliament Sweden’s bid to join the NATO military alliance, appearing to end months of drama over the issue.  Hungary then agreed to move forward on the bid as well, Budapest waiting on Erdogan (though strongly hinting last week it was prepared to act regardless of his decision).

“I’m glad to announce that President Erdogan has agreed to forward the accession protocol for Sweden to the grand national assembly as soon as possible, and work closely with the assembly to ensure ratification,” Secretary General Jens Stoltenberg told a news conference, describing it as a “historic” step.

A joint statement between Turkey and Sweden said Sweden had reiterated that it would not provide support to the Kurdish groups and would actively support efforts to reinvigorate Turkey’s EU accession process.

President Biden was very pleased and said he would ask the U.S. Senate to move forward with Turkey’s request to purchase F-16s, which is how diplomacy works.

President Erdogan then said on Wednesday that he will forward the ratification of Sweden’s NATO bid to parliament when it reopens in the fall, adding that he expects Sweden to take some steps against terrorism in return for the approval.

--Meanwhile, Russian Ambassador to the United States Anatoly Antonov said the United States is preparing anti-Russian decisions at the NATO summit.  “Everything is being done to prepare the local public opinion for the approval of any anti-Russian decisions that will be made in Vilnius in the coming days,” Antonov said in a post on the embassy’s Telegram channel.  “The situation continues to slide towards the most unfavorable outcome in the confrontation between the Russian Federation and the members of the alliance,” Antonov added.

In an interview with an Indonesian newspaper published on Wednesday, Russian Foreign Minister Sergei Lavrov said the “armed confrontation” in Ukraine will continue until the West gives up plans to dominate and defeat Moscow.

The goal of the “U.S.-led collective West” is to strengthen its global hegemony, Lavrov told the Kompas newspaper.

“Why doesn’t the armed confrontation in Ukraine come to an end?  The answer is very simple – it will continue until the West gives up its plans to preserve its domination and overcome its obsessive desire to inflict on Russia a strategic defeat at the hands of its Kyiv puppets,” according to a transcript published on Russia’s foreign ministry website.

“For the time being, there are no signs of change in this position,” Lavrov said.

Tuesday, Dmitry Medvedev, the deputy secretary of Russia’s Security Council and former president, said that the increase in military assistance to Ukraine by the NATO alliance brings World War III closer.  Medvedev said the aid pledged to Ukraine would not deter Russia from achieving its goals in Ukraine.

“The completely crazy West could not come up with anything else… In fact, it’s a dead end. World War III is getting closer,” Medvedev wrote on Telegram.  “What does all this mean for us? Everything is obvious.  The special military operation will continue with the same goals.”

Wednesday, the Kremlin said that security assurances the West is considering for Ukraine, including from the G7, would be a dangerous mistake that would impinge on Russia’s own security and expose Europe to greater risks for many years ahead.

Kremlin spokesman Dmitry Peskov said the proposed security assurances for Kyiv were a mistake which Moscow would be forced to factor into its future decision-making.

“We consider this move to be badly mistaken and potentially very dangerous,” he told reporters.  “Because by providing any kind of security guarantees for Ukraine, these countries would be ignoring the international principle on the indivisibility of security.  By providing guarantees to Ukraine, they would be impinging on the security of the Russian Federation,” he said.  It was impossible for Russia to tolerate anything that threatened its own security, Peskov added, saying he hoped that politicians in the West would realize the risks attached to providing Ukraine with such assurances.  Such a move “is fraught with highly negative consequences in the medium, long and even short term,” said Peskov.  “By taking such a decision, these countries will make Europe much more dangerous for many many years to come. And of course they will do a disservice to us, something we will take into account and keep in mind in future.”

The Russian Foreign Ministry said on Wednesday that the Western alliance was returning to “Cold War schemes,” adding that the Kremlin was ready to respond to threats by using “all means.”

In a statement, the Foreign Ministry said: “The results of the Vilnius Summit will be carefully analyzed. Taking into account the challenges and threats to Russia’s security and interests that have been identified, we will respond in a timely and appropriate manner, using all means and methods at our disposal.”

It said NATO was continually lowering the threshold for the use of force, escalating political and military tensions.

“Taking the course of escalation, they issued a new batch of promises to supply the Kyiv regime with more and more modern and long-range weapons in order to prolong the conflict as long as possible – to exhaustion,” the ministry said.

Wednesday, Biden delivered a sweeping speech at Lithuania’s Vilnius University, expressing unremitting support for Ukraine and NATO unity.  “We will not waver,” he said. He described the world at an “inflection point,” tested by the war in Ukraine, among even larger and more existential challenges, including climate change and a global contest between democracy and autocracy.

“Putin still doubts our staying power,” Biden said.  “He still doesn’t understand that our commitment, our values, our freedom, is something that we can never, ever, ever walk away from. It’s who we are.”

Biden pointed to the “transformational power of freedom,” referencing Lithuania’s own painful history, which included the Soviet deportation of Lithuanians after Moscow annexed the country in 1940 and the deadly assault by Soviet troops on pro-independence protesters in Vilnius in 1991. And he sought to paper over simmering disagreements among U.S. allies, highlighting the widespread support for Ukraine across the Western world.

“NATO is stronger, more energized and, yes, more united than ever in its history,” Biden said.  “When Putin, and his craven lust for land and power, unleashed his brutal war on Ukraine, he was betting NATO would break apart…But he thought wrong.”

Biden told Zelensky: “The United States is doing everything we can to get you everything we can,” as the meeting between the two leaders began.  Zelensky thanked the United States for ongoing military aid, including Biden’s recent decision to approve the supply of widely banned cluster munitions to Ukraine.

Zelensky tweeted: “I believe we will be in NATO once the security situation stabilizes.  Put simply, when the war is over, Ukraine will be invited into NATO and Ukraine will clearly become a member of the Alliance.  I felt no thoughts of any other sort.”

Opinion….

Editorial / Wall Street Journal

“One success, one muddle. That’s the scorecard for this week’s NATO summit, as the defense allies admitted Sweden while disagreeing on whether or when to admit Ukraine.  President Biden seems especially reluctant to welcome Ukraine, which reflects his strategic ambivalence throughout the conflict.

“The alliance finally overcame Turkey’s opposition to Sweden’s entry, which will bring the membership to 32 countries.  For all the talk about the age of dictators, more countries want to join the alliance of Western democracies.

“Sweden operates advanced fighter jets and the U.S. Patriot air defense system, it is a hub of Europe’s tech industry, and it is on track to ramp up spending on defense from roughly 1.4% to the 2% of GDP that is the alliance minimum.  Sweden’s Gotland island is crucial real estate in the Baltic Sea that would complicate Russia’s naval ambitions.

“The price of Turkey’s support for Sweden appears to be American F-16 fighter jets for Ankara, though the White House is denying this exchange. Strongman Recep Tayyip Erdogan did his usual routine of holding out until the last minute to extract concessions that don’t appear to be all that consequential….

“Ukraine is a knottier debate.  NATO’s leaders deserve credit for saying plainly in their Tuesday communique that ‘Ukraine’s future is in NATO.’  But the allies said this will happen only when unspecified ‘conditions are met.’  Mr. Biden didn’t help Kyiv’s confidence with his vocal opposition to a defined path for Ukraine’s membership in NATO at the end of the war.

“The question isn’t whether Ukraine will join tomorrow. Winning the war is the priority, and NATO Secretary General Jens Stoltenberg is right that ‘unless Ukraine prevails, there is no membership to be discussed at all.’ NATO members aren’t interested in complicating the alliance’s Article V commitment during a hot conflict.

“But giving Ukraine and Russia a clear signal that Ukraine will be able to join after the war is a way to win the peace.  Kyiv is likely to have one of the most experienced and lethal militaries in Europe, and NATO membership would anchor that capability and will to fight firmly in the West.

“The prospect of membership would also help Volodymyr Zelensky sell a peace deal to his own public, even if it includes letting Russia keep Crimea or other territory.  Ukraine’s credible worry is that Russia bides its time after a truce and launches another assault. That is much less likely if Ukraine is in the alliance.

“Mr. Biden offered vague intonations that Ukraine needs to become more democratic, but a formal affiliation with the West will be an incentive to do so.  The U.S. should prefer a Kyiv it can influence toward stronger public institutions.  The President is also afraid Vladimir Putin will escalate, a fear that has animated his every decision on Ukraine.  But Mr. Putin threatens to ratchet up his war nearly every time the West donates tanks or air defenses, and he has more than enough excuses.

“Mr. Putin’s problem is that escalating has costs of its own, not least domestically because it would require a greater military mobilization. That wouldn’t be easy to sustain.  Russia is losing 35 times as many soldiers per month as it did in the Soviet Union’s occupation of Afghanistan, according to a Center for Strategic and International Studies analysis this year.

“Mr. Biden’s reluctance on NATO fits his pattern of being slow to react to the changing circumstances of the conflict. He was slow to try to deter the invasion and slow to provide advanced weapons.  The F-16 pilot training he announced in May may finally start next month.

“Mr. Biden also seems slow to recognize the strategic benefits of a Ukrainian victory. The President gets credit for helping to keep the alliance together to support Ukraine, but U.S. leadership will be as important to keep it united to bring Kyiv into NATO.”

Editorial / Wall Street Journal, Part II

“No sooner had the Biden Administration announced that cluster bombs will be included as part of its $800 million package of military aid to Ukraine than President Biden was attacked by members of his own party and even some allies.  Our only criticism is that the decision could have done more good earlier.

“Mr. Biden says it was a ‘very difficult decision.’ Cluster bombs are anti-personnel weapons that eject multiple smaller bomblets over a large area.  They can be very effective, and Russia has used them against Ukrainians from the start of the war.  But 123 countries – not including the U.S., Ukraine or Russia – have signed a treaty banning their use because the unexploded bomblets can harm civilians years after the fighting has ceased.

“The higher the percentage of unexploded bomblets, or dud rate, the greater the menace.  The Pentagon says the cluster bombs they are sending to Ukraine have a dud rate of 2.35%.  That compares with dud rates of up to 40% for Russian cluster bombs.

“The U.K., Canada, Spain and New Zealand criticized Mr. Biden’s decision. And in the Washington Post, former Sen. Patrick Leahy and current Sen. Jeff Merkley called cluster bombs ‘a weapon that the United States should be leading the global effort to prohibit.’

“Pennsylvania Democrat Chrissy Houlahan, an Air Force veteran who co-chairs a bipartisan congressional caucus on unexploded ordinance, said the decision is ‘blurring the lines of moral high ground.’

“Ukraine isn’t seeking to use these bombs against civilians. It wants them because they are running out of other munitions and figures they can compensate for some of the advantage Russia still holds. The greater risk to Ukrainian civilians is from Russia’s invading army and indiscriminate weapons targeting.

“If you can’t see a moral distinction between Russia’s aggression and Ukraine’s use of cluster bombs for defense, then you have the blurred vision. Those best suited to make the tradeoff between risks are the Ukrainians whose lives are on the line every day.”

I can’t believe the Journal didn’t include that cluster bombs are immensely effective against the Russians in their trenches, the lines of defense, frankly, brilliantly conceived by Russian Defense Minister Shoigu, that have been effectively slowing down Ukraine’s counteroffensive.

And speaking of the lines of defense, trenches with minefields in between, The Economist had a terrific, and horrifying, piece on the Ukrainian “sappers” tasked with demining the fields.

In part:

“In this game, 50 centimeters [Ed. 20 inches] can make all the difference.  ‘Tsar,’ a 35-year-old veterinarian turned combat engineer, was part of a five-man group demining fields near Robotyne on June 27th.  The sappers were three hours into their early-morning mission when artillery duels began.  First came the mortars – not in itself a signal to stop working.  But then came cluster munitions, which began to explode overhead.  ‘You know where you are with mortars.  With clusters you’re in one of two camps: lucky or unlucky.’ Tsar escaped with shrapnel injuries in the soft tissue of his backside, from which he is recovering in the local hospital.  Five tourniquets could not save his comrade Dima Shulgin, just 50 centimeters to his side.  He died from bleeding the next day, aged 35.”

I want those cluster munitions on the Russians, not on our Ukrainian friends.

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Wall Street and the Economy

It was all about the consumer price data for June this week, the final major inflation barometer ahead of the Fed’s next Open Market Committee meeting, July 25-26.  And it was below forecasts, up just 0.2%, both on headline and core, ex-food and energy.  For the 12 months the CPI was up 3.0%, and 4.8% on core, also both below expectations.

Inflation hit a 40-year high of 9.1% in June 2022, so for 12 consecutive months it has fallen.  Flat grocery prices partly offset a rebound in gasoline costs and still-hefty rent hikes.

But the Fed focuses on core and, just as in the case of core PCE (personal consumption expenditures index), at 4.8% (PCE was 4.6% last reading), they are still way too high vs. the Fed’s 2% target, and thus the Fed is more than likely to hike rates another 25 basis points in about ten days.

[June producer prices, less important these days, were up only 0.1% on both headline and core; 0.1% as well year-over-year, 2.4% Y/Y ex-food and energy.]

I understand the optimism in response to the CPI in terms of the equity and bond markets, but I’ve been consistent in my message, which is just following the Fed’s language, and they are far from a day where they will be cutting rates.  I can’t conceive of the Fed doing so until core is below 3.5%, and probably a little further from there.  Understand that while CPI on headline has fallen from 9.1% to 3.0%, core CPI has only declined from a peak of 6.6% to 4.8% over the same period of time.

And watch oil prices, which are attempting to bust out of a narrow trading range.  That can have a huge impact on the headline numbers in the coming months.

San Francisco Federal Reserve Bank president Mary Daly on Monday repeated that she believes two more rate hikes this year will likely be needed to bring down too-high inflation in the face of a strong labor market.

“We may end up doing less because we need to do less; we may end up doing just that; we could end up doing more. The data will tell us,” she said.

Fed Reserve Bank of Cleveland President Loretta Mester said on Monday that still-strong levels of underlying inflation pressures are pointing the central bank toward more rate rises.  “The economy has shown more underlying strength than anticipated earlier this year, and inflation has remained stubbornly high, with progress on core inflation stalling,” Mester said in a speech.

Neither Daly nor Mester are voting members on the FOMC this year.

St. Louis Fed President James Bullard announced he will be leaving the bank to become dean of Purdue University’s business school, the resignation effective immediately.  Bullard has been as outspoken as any Fed official that further interest rate increases will be needed to bring inflation under control.

The St. Louis Fed’s leader is not a current voting member and won’t be again until 2015.

One other important item…the U.S. Treasury posted a $227.77 billion budget deficit in June, above the $184bn deficit expected and much larger than the $88.84 billion budget deficit a year earlier due to sharply lower receipts and outlays that were significantly higher.

Through the first nine months of the fiscal year, the 2023 deficit totaled $1.393 trillion, up from $515.07bn in the same period a year earlier.  This is the killer issue down the road.

The Atlanta Fed’s GDPNow barometer for the second quarter is at 2.3%, with a first look from the government coming July 27.

Freddie Mac’s 30-year fixed-rate mortgage climbed to 6.96%, but now the yield on the 10-year has cratered again, as will next week’s mortgage read.

China / U.S. Talks

Treasury Secretary Janet Yellen was in Beijing last week for key talks.  Yellen said on Sunday in Beijing before her departure that the 10-hour bilateral talks with China’s new economic officials helped lay the groundwork for surer footing to stabilize the strained relations, and she expected more engagement onward.

The United States will continue to take targeted action to protect its national security while pushing for more dialogue with China, Yellen said.

The four-day visit offered the two sides a chance to stabilize relations and she told a press conference that there had been “direct, substantive and productive” discussions but significant differences remained.

Yellen stressed the U.S. is not seeking to decouple from China which would be “disastrous for both countries and destabilizing for the world” and also “virtually impossible to undertake.”

“There is an important distinction between decoupling on one hand and on the other hand diversifying crucial supply chains.  We are taking targeted national security actions,” she said.

“We believe the world is big enough for both of our countries to thrive,” she said.  “No one visit can solve our challenges overnight. But I hope the trip will help build a resilient and productive channel of communications.”

Yellen said she had tried to address Chinese concerns that “derisking” – the U.S. and other Western countries seeking to reduce their economic reliance on China – amounted to decoupling and said the two are “by no means the same thing.”

She added that even in the sectors where Washington is trying to derisk, the U.S. will continue to have trade and investment with China.

“A great deal of our economic interaction with respect to trade and investment is unproblematic, uncontroversial, brings benefits to us, brings benefits to China, and we want that to continue…Certainly I think that message was received.”

She said some progress was made during her trip without elaborating, translation, ‘zero progress’ was made.  A brief statement from Chinese state news agency Xinhua implied deep rifts remained between the two sides.

“Abuses of national security would harm normal economic and trade interactions,” Xinhua said on Saturday.

More broadly, for its part, Beijing urged Washington to remove economic sanctions on Chinese companies and called for joint efforts to address global challenges, in talks with Secretary Yellen.

“China’s development is an opportunity, rather than a challenge, to the U.S.  It means benefits, not risk,” the Ministry of Finance said in a statement on Monday to wrap up China’s position in the talks.

“During the talks, China reiterated its requests for the U.S. to remove tariffs, stop containing Chinese companies, ensure fair treatment in bilateral investment, loosen export controls, and lift bans on Xinjiang-related products,” the ministry statement said.  “China hopes the U.S. will take concrete measures in response to [Beijing’s] major concerns in bilateral economic relations.”

Despite Yellen’s upbeat assessment, the U.S. will continue to impose national security restrictions on China’s access to advanced technology.

The U.S. has put more than 1,000 Chinese companies on sanctions lists or under export controls, and is mulling new restrictions on U.S. investment in China.

Beijing has repeatedly lashed out at Washington’s alleged abuses of national security, and broad bilateral relations have hit new lows in recent years amid hot-button issues including tech restrictions, national security, human rights and Taiwan.

China has also imposed an anti-espionage law, started investigations into several U.S. consultancy firms and banned Micron, a major U.S. tech company, from selling products to Chinese clients.

Yellen said she raised concerns about recent punitive measures against U.S. firms.

The finance ministry statement added that the U.S. said it “was not intent on forcing countries to take sides, as doing so would lead to fragmentation in the global economy.”

“Frank exchanges are needed between the two countries to reach a consensus on important issues in bilateral economy and to inject stability and positivism into economic relations,” the statement added.

It also called for coordination to tackle global challenges such as the economy, climate change and debt relief.

“Confronted with severe global challenges, China hopes developed countries including the U.S. will take on responsibilities, and be mindful of concerns in the developing world,” it added.

“Differences should not lead to estrangement but should serve as the impetus for closer exchange and communication.”

Well, so much of this is total BS.

Here’s the bottom line.  China refuses to have military to military exchanges, including the establishment of a deconfliction hotline, such as exists between Washington and Moscow.  This tells you everything about where we’re headed.  War.  Maybe not in my remaining years, though China will be attempting to take Taiwan sooner than later.  It’s whether or not the Taiwan conflict leads to a broad conflict between the West and China.

Thursday, Chinese foreign policy chief Wang Yi met Secretary of State Blinken, the second meeting between the top diplomats in less than a month.

The talks took place on the sidelines of the annual ASEAN Foreign Ministers’ meeting in the Indonesian capital of Jakarta, where Wang was representing China in place of Qin Gang. Foreign Minister Qin has been absent from public view for weeks due to “health reasons.”

Wang told Blinken that Washington must refrain from interfering in China’s internal affairs, stop suppressing its economy, trade and technology, and lift its sanctions against China, the state-run Xinhua news agency said.  Practical actions need to be taken to bring Sino-U.S. relations back onto the right track, Wang told Blinken.

Europe and Asia

A quiet week for the eurozone, with one little reading of note on industrial production for May, up by 0.2% compared with April, and down by 2.2% from a year ago. [Eurostat]

Separately, Bank of England Governor Andrew Bailey said on Monday the British central bank had to “see the job through” on bringing down an inflation rate that is running higher than in any other major rich economy. 

“Both price and wage increases at current rates are not consistent with the inflation target,” Bailey said.  “Currently at 8.7% in the latest data, consumer price inflation is unacceptably high, and we must bring it down to the 2% target.”

The next policy announcement is Aug. 3.  The BoE has raised interest rates at each of the past 13 meetings of its Monetary Policy Committee.

In Germany, June core inflation came in at 5.8%, up from 5.4% in May, showing inflation is proving to be sticky here, just as elsewhere.  Higher food prices are dampening household consumption as well, which is one reason for Germany entering a technical recession in the first quarter of the year.

Big inflation data for the eurozone next week.

Netherlands: Prime Minister Mark Rutte, the Netherlands’ longest-serving prime minister, said on Monday that he would step aside as his party’s leader and would be leaving politics in the coming months after his ruling coalition collapsed last week.

Rutte came to power in 2010 and earned the name “Teflon Mark” for his ability to weather political storms, but the failure of the four parties in his coalition to come to an agreement on the country’s migration policies set the stage for elections in the fall.

The leader of the People’s Party for Freedom and Democracy, Mr. Rutte, 56, remains in charge of a caretaker government.

Turning to Asia...China reported its June inflation, courtesy of the National Bureau of Statistics, and it was unchanged year-over-year, which isn’t good.  June producer (factory gate) prices fell 5.4% Y/Y.

But the big news was on the trade front, where June exports fell 12.4% year-over-year, the steepest drop since February 2020, following a 7.5% fall in May, and worse than forecasts of a 9.5% fall, amid slowing global demand.

Exports to the U.S. slumped by 23.7% from a year earlier, while those to the EU and ASEAN countries fell by 12.9% and 16.9%, respectively.  Conversely, shipments to Russia jumped by 90.9%.  For the first half of the year, exports dropped 3.2% from the same period in 2022.

Imports declined 6.6% Y/Y.

As global growth slows and as many central banks still seem poised to raise interest rates to push down inflation, it appears increasingly unlikely that foreign demand for Chinese goods will be able to help the world’s second-largest economy as its rebound falters.

Next week a slew of important data on China’s economy, including second-quarter GDP.

Japan’s June producer price index came in at 4.1% year-over-year vs. 5.2% prior.  As in all over the world, the PPI is coming down post-pandemic.

May industrial production rose 4.2% Y/Y, a solid number.

Street Bytes

--Stocks rallied on the positive inflation data, with the Dow Jones up 2.3% to 34509, the S&P 500 gaining 2.4% and Nasdaq 3.3%.  Today’s seemingly positive bank earnings had little impact.  But far more impactful earnings the next three weeks, including from the “Magnificent Seven” (MSFT, AAPL, META, AMZN, GOOGL, TSLA and NVDA).

Who wrote the stirring music for the 1960 film “The Magnificent Seven”?  The great Elmer Bernstein…the theme song then used for commercials for “Marlboro Country,” but I digress.

--U.S. Treasury Yields

6-mo. 5.47%  2-yr. 4.76%  10-yr. 3.83%  30-yr. 3.93%

After soaring the week before on the Fed minutes and hawkish comments, Treasuries rallied (yields fell) bigly on the better inflation/CPI data, the 2-year from an intraday high of 5.11% the previous week down to 4.61% Thursday, before closing today at 4.76%.  The key 10-year yield closed at 4.06% last Friday, fell to 3.76% yesterday, and closed the week at 3.83%.

Euro bond yields also took heart in our CPI numbers and rallied strongly as well, the German 10-year falling from 2.63% to 2.51%.

--The Bank of Canada on Wednesday hiked its key overnight rate by a quarter point to a 22-year high of 5.0%, and said it could raise rates further because inflation risks are seen stalling above its 2% target.  The move was expected by analysts.  The BoC also raised its forecast for second-quarter annualized growth to 1.5% from 1.0% in April, and growth is seen expanding 1.5% in the third quarter.

--In an interview Monday, International Energy Agency chief Fatih Birol said oil demand from China and developing countries, combined with OPEC+ supply cuts, is likely to keep the market tight in the second half of the year despite a sluggish global economy.

The price of West Texas Intermediate rallied for a third week to $75.24, breaking out of a tight $69 to $73 range.  Will it hold?  The Saudis sure hope so.

--JPMorgan Chase posted a 67% jump in profit for the second quarter on Friday as it earned more from borrowers’ interest payments and benefited from the purchase of First Republic Bank.  Shares of the largest lender rose about 3% in premarket trading, but fell off during the trading day for a marginal gain.

CEO Jamie Dimon reassured investors that the economy remained resilient.  “Consumer balance sheets remain healthy, and consumers are spending, albeit a little more slowly.  That being said, there are still salient risks in the immediate view” such as consumers using up their cash buffers, high inflation, quantitative tightening, and the war in Ukraine, he said in a statement.

The bank bought a majority of First Republic’s Bank’s assets in a government-backed deal in May after weeks of industry turbulence.  That bolstered its net interest income (NII), which measures the difference between what banks earn on loans and pay out on deposits.  The bank’s NII jumped $21.9 billion, up 44%, or up 38% excluding First Republic.

JPM’s profit climbed to $14.47 billion, or $4.75 per share, for the quarter ending June 30.

The bank plans to cut around 500 jobs across different divisions, according to reports from back in May.

--Wells Fargo’s profit surged 57% in the second quarter to $4.94 billion as it, too, earned more from customer interest payments and raised its annual forecast for net interest income, sending shares up nearly 4% in premarket trading today.

WFC’s NII climbed 29% to $13.16 billion as banks raised their borrowing costs following the Fed’s series of rate hikes.  The fourth largest U.S. lender said NII is expected to be about 14% higher than last year’s $45 billion.

“The U.S. economy continues to perform better than many had expected, and although there will likely be continued economic slowing and uncertainty remains, it is quite possible the range of scenarios will narrow over the next few quarters,” said CEO Charlie Scharf in a statement.

Wells set aside $1.71 billion in provisions for credit losses in the second quarter, compared with $580 million a year ago.  Provision for credit losses included a $949 million increase in the allowance, mainly for potential losses in commercial real estate office loans, as well as for higher credit card loan balances.

The bank reported a profit of $1.25 per share for Q2, beating analysts’ average estimate of $1.16 per share.

--Citigroup’s profit tumbled 36% in the second quarter as weakness in its trading business blunted gains from its personal banking and wealth management unit.  Wall Street traders have hit a rough patch, joining investment bankers whose businesses have been weighed down for months by a slump in dealmaking.  Citi’s markets revenue fell 13% to $4.6 billion on more subdued activity in fixed income and equities, while its investment banking fees plunged 24% to $612 million.

But the lender’s consumer business offsets some of the weakness.  Revenue from its personal banking and wealth management division climbed 6% to $6.4 billion. 

Net income sank to $2.29 billion, or $1.33 per share in Q2.  Revenue came in at $19.44 billion, down from $19.64bn a year ago but ahead of expectations.

--BlackRock Inc. on Friday beat second-quarter profit estimates, as investors continued to pour money into its various funds on the back of the rally in the markets.  The New York-based firm ended the second quarter with $9.4 trillion in assets under management (AUM), up from $8.5 trillion a year earlier and $9.1 trillion in the first quarter.  Revenue at BlackRock fell 1.4% to $4.46 billion from a year earlier, driven by the impact of market movements over the past 12 months on average AUM, it said.

The world’s largest asset manager, which makes most of its money from fees charged for investment advisory and administrative services, saw a 25% rise in its second-quarter adjusted profit, $9.28 per share, beating estimates of $8.46.

--Microsoft can close its $75 billion acquisition of Activision Blizzard, a federal judge ruled Tuesday, delivering a major setback to the Biden administration’s attempt to rein in big mergers.

The deal would combine Microsoft’s Xbox videogaming business with the publisher of popular franchises such as Call of Duty, World of Warcraft and Candy Crush.  The ruling means there is no current U.S. obstacle to the two companies merging and it is hoped the deal will now close as early as next week.

The companies are still seeking UK merger approval and it wasn’t immediately clear whether the holdup there would delay closing.  The bid, however, got a boost Tuesday when Britain’s Competition and Markets Authority said it was prepared to consider new proposals from Microsoft for addressing its competition concerns.

In a 53-page decision, Judge Jacqueline Scott Corley of U.S. District Court for the Northern District of California, said in her opinion that the Federal Trade Commission hadn’t shown that Microsoft’s ownership of Activision games would hurt competition in the console or cloud-gaming markets.  “To the contrary, the evidence points to more consumer access to Call of Duty and other Activision content,” she wrote.

The FTC had sought an injunction to prevent the two companies from completing their megadeal before the agency began a separate process to challenge it in August.

The ruling is a significant blow to the FTC’s efforts to police blockbuster tech mergers more aggressively.  That strategy is spearheaded by the agency’s chair, Lina Khan, who has argued that Big Tech’s vast influence over commerce and communications has led to anticompetitive behavior.  The FTC has sued Microsoft, Meta and Amazon, but it walked away from one of its cases against Meta and has had little to show for its efforts so far.

Editorial / Wall Street Journal

“Another big swing and a miss by Lina Khan.  A federal judge Tuesday slapped down the Federal Trade Commission Chair’s attempt to block Microsoft’s $75 billion acquisition of video game developer Activision Blizzard.  When is she going to win a case? ….

“ ‘Before the merger, there is no access to Activision’s content on cloud-streaming services,’ the judge writes.  ‘After the merger, several of Microsoft’s cloud-streaming competitors will – for the first time – have access to this content.  The merger will enhance, not lessen, competition in the cloud-streaming market.’

“As if all of that isn’t humiliating enough for Ms. Khan, Judge Corley concludes that ‘in sum, the FTC has not raised serious questions regarding whether the proposed merger is likely to substantially lessen competition.’  The judge seems almost stunned that the FTC would bring such a weak case.

“Yet this is Ms. Khan’s method: Sue first based on dubious or long-repudiated antitrust legal theories, then scramble to find evidence to support the agency’s claims.  A CEO with her record of failure would be out of a job.”

Well, after this loss at the FTC, the agency opened an investigation into OpenAI, the artificial intelligence start-up that makes ChatGPT, over whether the chatbot has harmed consumers through its collection of data and its publication of false information on individuals.

In a 20-page letter sent to the San Francisco company this week, the agency said it was also looking into OpenAI’s security practices.  The FTC asked OpenAI dozens of questions in its letter, including how the start-up trains its AI models and treats personal data.

Sam Altman, who leads OpenAI, has said the fast-growing A.I. industry needs to be regulated.  In May, he testified in Congress to invite A.I. legislation and has visited hundreds of lawmakers, aiming to set a policy agenda for the technology.

“I think if this technology goes wrong, it can go quite wrong,” he said at the hearing.  “We want to work with the government to prevent that from happening.”

--Hollywood has effectively shut down after leaders of a union representing nearly all TV and film actors announced Thursday that they will go on strike, joining an ongoing walkout by Hollywood writers that has already brought production of many shows and movies to a halt.

During a news conference in Los Angeles, union representatives for the Screen Actors Guild-American Federation of Television and Radio Artists (SAG-AFTRA) announced the historic move after contract negotiations with companies such as Netflix, Amazon, Disney and Warner Bros. disintegrated Wednesday.

“The jig is up,” SAG-AFTRA President Fran Drescher said in a searing address targeted at the Alliance of Motion Picture and Television Producers, the bargaining group representing major studios.  “You cannot keep being dwindled and marginalized and disrespected and dishonored.  The entire business model has been changed by streaming, digital, AI,” she continued.  “If we don’t stand tall right now, we are going to be in trouble. We are all going to be in jeopardy of being replaced by machines and big business, who cares more about Wall Street than you and your family.”

The union, which represents about 160,000 members, will join the Writers Guild of America for their first double strike in 63 years.

But think about all the ancillary businesses that are impacted. 

--Delta Air Lines reported unprecedented quarterly profit and revenue Thursday and raised its expectations for a year after travelers took to the skies in huge numbers, defying some forecasts of a pullback in spending.

Revenue soared almost 13% to $15.58 billion, a surprising jump even for a carrier that has outperformed consistently.  The shares rose about 4% in response.

“Robust demand is continuing into the September quarter where we expect total revenue to be similar to the June quarter, up 11 percent to 14 percent compared to the September quarter 2022 on capacity that is 16 percent higher,” said Glen Hauenstein, Delta’s president, in a written statement.

Delta’s second-quarter profit was $1.83 billion, or $2.84 per share.  Adjusted earnings came in at $2.68, far exceeding the $2.42 the Street was expecting.

The Atlanta-based carrier boosted its per-share earnings expectations for the year to $6 to $7, up from previous projections for $5 to $6.

Delta’s profit-fueled quarter lifted the entire sector in early trading Thursday, the others reporting earnings next week, but the share prices fell by session’s end.

--TSA checkpoint numbers vs. 2019

7/13…100 percent of 2019 levels
7/12…97
7/11…96
7/10…103
7/9…99
7/8…105
7/7…94
7/6…97

--Dow component UnitedHealth Group reported a quarterly profit above estimates on Friday due to lower-than-feared medical costs, sending shares up over 7% and allaying concerns that a surge in non-urgent procedures would hit profit growth.

Shares in UNH had fallen 9% since the healthcare conglomerate said it was recording higher payouts over medical care between April and early June, as older adults became more comfortable visiting doctors’ offices again after Covid risks receded.  Older adults are usually covered by government-backed Medicare insurance plans, which the company offers.

The company posted an adjusted profit of $6.14 per share for the second quarter, above analysts’ expectations of $5.99.  UNH slightly raised the upper range of its forecast for the entire year.

--Federal regulators accused Bank of America on Tuesday of harming customers by double-dipping on fees, withholding credit card rewards and opening fake accounts.

The Consumer Financial Protection Bureau ordered Bank of America to pay more than $100 million to customers and $90 million in penalties.  The Office of the Comptroller of the Currency also ordered BAC to pay $60 million in fines.

Some of the allegations are reminiscent of the Wells Fargo scandal last decade that involved opening millions of bank accounts without customer authorization.

“Bank of America wrongfully withheld credit card rewards, double-dipped on fees, and opened accounts without consent,” CFPB Director Rohit Chopra said in a statement.  “These practices are illegal and undermine customer trust.  The CFPB will be putting an end to these practices across the banking system.”

BofA had a policy of charging customers $35 after the bank declined a transaction because the customer did not have enough funds in their account, the CFPB said.  The agency determined that the bank double-dipped by allowing fees to be repeatedly charged for the same transaction.  The bank said it has voluntarily reduced overdraft fees the past few years and eliminated all non-sufficient fund fees in the first half of last year.

--Taiwan’s Foxconn withdrew from a $19.5 billion semiconductor joint venture with Indian metals-to-oil conglomerate Vedanta, it said on Monday, in a setback to Prime Minister Narendra Modi’s chipmaking plans for India.

The world’s largest contract electronics maker signed a pact with Vedanta last year to set up semiconductor and display production plants in Modi’s home state of Gujarat.

“Foxconn has determined it will not move forward on the joint venture with Vedanta,” a Foxconn statement said without elaborating on the reasons.

Vedanta said it is fully committed to its semiconductor project and had “lined up other partners to set up India’s first foundry.”

I bring this up because Foxconn is developing quite a reputation for its inability to keep its word.  It has backed off on major commitments in the U.S. the last few years and just can’t be relied on.

It’s best known for assembling iPhones and other Apple products but in recent years it has been expanding into chips to diversify its business.

--Farmers Insurance is limiting sales of homeowners policies in Florida and California, becoming the latest big insurer to pull back from the hurricane- and wildfire-prone states.

Rising costs for natural disasters, rebuilding and lawsuits are prompting insurers to limit or even quit selling in markets with high underwriting losses.  Fewer insurers offering policies can mean higher prices and fewer options for homeowners, consumer advocates say.

In Florida, Farmers is ending sales of home, auto and umbrella insurance policies under its own brand, representing about 30% of the policies it sells in the state, the company said.  It will continue offering insurance through other brands, including those for high-risk drivers, according to the statement. The ending of Farmers-branded sales in Florida affects around 89,000 policies.

In California, where rivals State Farm and Allstate decided recently to stop selling new home insurance policies, Farmers won’t fill the gap.  Farmers said it was limiting new policies of one of its branded home-insurance products to around 7,000 policies a month, “consistent with the volume we projected to write each month before recent market changes.”

Farmers said the pullbacks are designed to “mange [its] risk exposure,” in light of high inflation, severe weather events and reconstruction costs.

--The Wall Street Journal had an exclusive story on AT&T, Verizon and other telecom giants having “left behind a sprawling network of cable covered in toxic lead that stretches across the U.S., under the water, in the soil and on poles overhead,” a Journal investigation found.  “As the lead degrades, it is ending up in places where Americans live, work and play.”

“The lead can be found on the banks of the Mississippi River in Louisiana, the Detroit River in Michigan, the Willamette River in Oregon and the Passaic River in New Jersey, according to the Journal’s test of sample from nearly 130 underwater-cable sites, conducted by several independent laboratories.”

Your editor lives, oh, about 250 yards from the mighty Passaic.

The Journal notes that while the U.S. has spent decades eradicating lead from well-known sources such as paint, gasoline and pipes, the investigation revealed a hidden source of contamination – more than 2,000 lead-covered cables – that hasn’t been addressed by the companies or environmental regulators.  The cables are a leftover legacy of the old Bell System’s’ regional telephone network, and their impact on the environment hasn’t been previously reported.

Doctors say no amount of contact with lead is safe, whether ingested or inhaled, particularly for children’s physical and mental development.  Lead can stay in the blood for about two or three months, and be stored in bones and organs longer.  Aside from behavior and learning issues in children, the risks include kidney, heart and reproductive problems in adults, according to U.S. health agencies.

The lead-covered cable network includes more than 1,750 underwater cables, according to public records collected by the Journal.  Also identified were about 250 aerial cables alongside streets and fields next to schools and bus stops, some drooping under the weight.  There are likely far more throughout the country.

Roughly 330 of the total number of underwater cable locations are in areas identified as a “source water protection area,” designated by federal regulators as contributing to the drinking-water supply, according to an EPA review performed for the Journal.

In New Jersey alone, more than 350 bus stops are next to or beneath aerial lead-covered cables, a Journal analysis found.

So, is there a big liability for the major telecoms?  Sure, potentially.

--PepsiCo shares rose Thursday as the company saw lower demand for its drinks and snacks in the second quarter, but higher prices continued to boost its bottom line.

Pepsi reported better-than-expected revenue and raised its full-year earnings forecasts.

Snack food volumes fell 3% in the April-June period, while beverage volumes dropped 1%, but net pricing rose 15%; the sixth consecutive quarter of double-digit price increases from PepsiCo.

Pepsi’s revenue rose 10% to $22.3 billion, beating the Street’s forecast of $21.7 billion.

Revenue improved at Frito-Lay North America and the company’s North American beverages unit.  PepsiCo also saw revenue growth in Latin America, Europe and Asia.

But pricing clearly took a toll.  In the company’s Africa, the Middle East and South Asia division, volumes dropped 6% as Pepsi hiked prices 24%. In Latin America, volume was down 3% as prices rose 16%.

Pepsi has previously blamed the high cost of packaging and commodities like cooking oil for its price increases.  But it could have a harder time raising prices as inflation eases. 

Pepsi’s net income nearly doubled to $2.75 billion.  Ex-items, the company earned $2.09 per share, which easily beat consensus of $1.95.

The company now anticipates full-year earnings up 12% on a constant currency basis, vs. a prior outlook of a 9% increase.  Organic revenue is now predicted to rise 10%, vs. a prior forecast of 8%.

--Walt Disney on Wednesday said CEO Robert Iger has agreed to stay on in his position through 2026.

The entertainment giant’s board unanimously voted to extend Iger’s contract by two years, in order to provide continuity as the company’s transformation continues and provides more time to prepare a transition plan for CEO succession.

Iger returned to Disney in November after Bob Chapek was ousted from the position last fall.

--Domino’s Pizza’s shares soared 11% Wednesday as the company announced a new agreement with Uber, saying U.S. customers could place orders using the Uber Eats and Postmates apps.

Food will still be delivered by the Domino’s uniformed and “trained delivery experts,” the pizza chain operator said. 

The initial U.S. rollout of the agreement will begin this fall in four pilot markets, with a nationwide launch anticipated by the end of 2023.  Uber Eats will be the exclusive third-party platform for Domino’s in the U.S. until at least 2024, according to the company.

Taking orders using the Uber Eats marketplace should provide Domino’s and its franchisees access “to a new segment of customers and what we believe will be a meaningful amount of incremental delivery orders once it’s widely available,” said Domino’s CEO Russell Weiner.

Uber Eats’ orders could reach 70% of Domino’s stores around the world, the company said.  The agreement creates “the opportunity to unify Domino’s international markets under a single master agreement,” according to a statement.

“Given certain customers only order their delivery from the Uber Eats app, this deal could make Domino’s available to millions of new customers around the world,” Weiner said.

--As Barron’s Eric J. Savitz put it: “One of the tricky parts of the generative artificial-intelligence phenomenon is whether you can effectively build comprehensive large-language models without violating rights of content creators.”

Tell me about it.

The issue came to the fore Monday, after comedian Sarah Silverman and two other authors filed a pair of purported class-action lawsuits against OpenAI, parent of ChatGPT, and Meta Platforms, which created LLaMA, a widely adopted AI model.

In a pair of lawsuits filed last week in federal court in San Francisco, the authors assert that the models created by the two companies illegally included their works in training their models.

Well, I’ll be trying to follow this case(s).

--For the second consecutive month, Mexican lager Modelo Especial remained the king of beer across the nation in June, decrowning Bud Light.

Bud Light lost its spot as the No.-1 selling U.S. beer in May as conservative consumers abandoned the brand after it collaborated with transgender influencer Dylan Mulvaney to promote a contest for the March Madness basketball tournament.

For the four weeks ending July 1, Modelo Especial took 8.7% of overall beer sales through retail stores while Bud Light came in second with a 7% share, according to an analysis of Nielsen data from consulting firm Bump Williams.  Michelob Ultra came in third (6.7%), followed by Coors Light, the official beer of StocksandNews (6.1%) and Miller Lite (5.1%).

In May, Bud Light represented 7.3% of U.S. retail-store beer sales in the four weeks ending June 3 compared with 8.4% for Modelo.

But Bud Light remains the top-ranking beer brand based on dollar sales year-to-date.

--“Indiana Jones 5” only took in $26.5 million in North America its second weekend for a domestic total of $121.2 million. Globally it’s earned an estimated $247.9 million.

This weekend it’s all about “Mission: Impossible – Dead Reckoning Part I,” with Tom Cruise and some spectacular stunts, which opened on Wednesday.  The following week I’m looking forward to “Oppenheimer,” which I will definitely see in the theater.

Foreign Affairs, Part II

China: Beijing was furious with NATO’s accusation that China challenges the group’s interests and security, and opposed any attempt by the military alliance to expand its footprint into the Asia-Pacific region.

In a strongly worded communique issued by NATO, it said the People’s Republic of China (PRC) challenged its interests, security and values with its “ambitious and coercive policies.” 

“The PRC employs a broad range of political, economic, and military tools to increase its global footprint and project power, while remaining opaque about its strategy, intentions and military build-up,” NATO heads of state said in their communique.  “The PRC’s malicious hybrid and cyber operations and its confrontational rhetoric and disinformation target Allies and harm Alliance security.”

The Chinese mission to the European Union said the communique disregards basic facts, distorts China’s position and policies, and deliberately discredits China.

NATO Secretary General Jens Stoltenberg in a press conference said that while China was not a NATO “adversary,” it was increasingly challenging the rules-based international order with its “coercive behavior,” (and) “refusing to condemn Russia’s war against Ukraine, threatening Taiwan, and carrying out a substantial military build-up,” he said.  But NATO did not mention Taiwan in its communique.

Speaking of Taiwan, nearly three dozen Chinese military aircraft and four warships traveled quite close to the island on Tuesday, Taipei’s Defense Ministry announced after.

Twenty-nine of those aircraft “crossed the median line of the Taiwan Strait or entered our (air defense identification zone),” Taiwan’s military said.

From the U.S. military’s perspective, that sort of activity from China isn’t just to show force, but it’s also an effort to exhaust Taiwanese defense capabilities and ability to respond. “Up until about maybe a year and a half ago, we never had a routine, consistent presence of the Chinese navy east of Taiwan.  Now, they’re there all the time,” one senior defense official told Defense One’s Patrick Tucker the other day.

“It’s just wearing out Taiwan’s air force for the air stuff and the navy for all of this contiguous presence, because you can’t really let it go unchallenged,” the U.S. official said.  “The Chinese have a lot more airplanes and a lot more capability to fly all the time. It’s just running the poor Taiwanese air force into the ground.”

The U.S. official said China is using (in all its centerline crossings) “clear and deliberate escalation…as a signaling tool.”

Experts continue to talk of 2027 as the most attractive date for an invasion for a variety of factors.  Early next year is Taiwan’s key election which could rapidly hasten the timetable, in your editor’s opinion.

On a different matter, Chinese hackers penetrated the email accounts of Commerce Secretary Gina Raimondo and other State and Commerce Department officials in the weeks before Secretary of State Antony Blinken traveled to Beijing in June, U.S. officials said on Wednesday.

The investigation of the efforts by the Chinese hackers, who likely are affiliated with China’s military or spy services, is ongoing, American officials said. But officials have downplayed the idea that the hackers stole sensitive information, insisting that no classified email or cloud systems were penetrated.  The State Department’s cybersecurity team first discovered the intrusion.

Ms. Raimondo has been one of the most outspoken critics of Beijing in the administration.  She has tightened export controls on China and threatened to cut off the country’s supply of U.S. semiconductor technology if it provides the chips to Russia.  Raimondo is expected to visit China by the end of the summer.

North Korea: Pyongyang accused the United States on Monday of violating its airspace by conducting surveillance flights and warned that, while the North was exercising restraint, such flights may be shot down.  Provocative military actions by the United States were bringing the Korean peninsula closer to a nuclear conflict, said an unnamed spokesperson of North Korea’s Ministry of National Defense in a statement carried by the official KCNA news agency.

The report also cited the use of U.S. reconnaissance planes and drones and said Washington was escalating tensions by sending a nuclear submarine near the peninsula.

“There is no guarantee that such a shocking accident as the downing of the U.S. Air Force strategic reconnaissance plane will not happen” in waters east of Korea, the spokesperson said.

South Korea’s military said North Korea’s claim of airspace violation is not true.  It said U.S. air surveillance assets conduct routine reconnaissance flights around the peninsula, adding the allies work closely together to monitor the North.

Later on Monday, Kim Yo Jong – the powerful sister of Kim Jong Un – said the country would respond decisively if the U.S. military entered North Korea’s economic zone again, according to state media.  U.S. and South Korean forces have been conducting air and navy drills this year that involved a U.S. aircraft carrier and heavy bombers.  A U.S. nuclear-powered cruise missile submarine also made a port call at Busan in South Korea last month. 

“It is up to future U.S. actions whether an extreme situation arises in the Korean peninsula region that nobody wants, and the United States will be held fully responsible if any unexpected situation occurs,” KCNA said.

So Wednesday, North Korea fired its first intercontinental ballistic missile in three months; a road-mobile Hwasong-18 ICBM, a type of solid-fuel weapon that is harder to detect and intercept than its liquid-fuel ICBMs.

And this launch was impressive, fired from North Korea’s capital region, flying 620 miles at a maximum altitude of 3,730 miles (6,000km) before landing in waters between the Korean Peninsula and Japan, according to both South Korean and Japanese assessments.  They said the missile was launched at a high angle in an apparent attempt to avoid neighboring Japan.  The missile flew for 74 minutes – the longest flight time recorded by any weapon launched by North Korea. 

South Korea’s military called the launch “a grave provocation” and urged Pyongyang to refrain from additional launches.

Bottom line, the missile, if stretched out rather than fired 6,000km in the air, could have hit anywhere in the world, let alone the United States.  That’s what the ICBM tests are for.  The shorter-range missile tests are designed to prepare for an attack on South Korea and Japan.

Experts still believe on the ICBM front that North Korea has yet to master some technologies in actually delivering a warhead that far.

Israel: Israeli protesters blocked major highways and faced off with police again this week as Prime Minister Benjamin Netanyahu’s hard-right coalition pressed ahead with a contested bill that seeks curbs to the power of the Supreme Court.  At least 42 were arrested in clashes with police.

The drive by Netanyahu’s nationalist-religious coalition to change the justice system has sparked unprecedented protests, stirred concern for Israel’s democratic health among Western allies and bruised the economy.

The new bill won a first of three required votes to be written into law late on Monday to the cries of ‘for shame’ by opposition lawmakers.

If passed as is, it would curb the Supreme Court’s power to quash decisions made by the government, ministers and elected officials by ruling them unconstitutional.

Critics argue that this judicial oversight helps prevent corruption and abuses of power, some adding it’s a step on the way to dictatorship.  Proponents say the change will facilitate effective governance by curbing court intervention, arguing that judges have other legal means to exercise oversight.

Random Musings

--Presidential approval ratings….

Gallup: 43% approve of President Biden’s job performance, 54% disapprove; 41% of independents approve (June 1-22).

Rasmussen: 45% approve, 54% disapprove (July 14).

--The latest Reuters/Ipsos poll has President Biden’s approval rating holding steady at 40% in early July, down a tick from the prior month’s 41%.

--In the first poll that the Republican National Committee will use to determine the candidates on the first debate stage next month, the Morning Consult survey of Republican primary voters, Donald Trump received 56% to Ron DeSantis’ 17%.  Vivek Ramaswamy was a surprising third at 8%, Mike Pence 7%, with Chris Christie, Nikki Haley and Tim Scott at 3%.  Asa Hutchinson garnered 1%.

--Karl Rove / Wall Street Journal

“A presidential candidate’s most important asset is his authenticity. So Democrats should be concerned that President Biden is so effectively undermining any sense that the return to decency he pitched in 2020 was genuine.

“Yes, presidential elections often turn on big issues and sharp ideological differences, on notable gaffes and tireless campaigning. But in most cases, a key element of victory is how apparently earnest a candidate is in making a case that resonates with the electorate.

“During the 1980 campaign, voters grew to trust in Ronald Reagan as a great communicator who would do what he said he would. It was authenticity that got his predecessor elected, too. In 1976, distrustful of politicians and politics after Watergate, many Americans wanted morality returned to the Oval Office and narrowly elected Jimmy Carter, a born-again Christian.

“As the nation’s economy sputtered in 1992, voters sought a candidate with empathy. Many believed Bill Clinton felt their pain. And in 2000 George W. Bush came across as genuine and likable – someone you’d like to share a beer with (non-alcoholic in his case) – while Al Gore did not….

“In 2020, after four years of chaos, swing voters wanted someone who would ‘restore the soul of America.’ Democrats sold what seemed an authentic story: Joe Biden of Scranton, Pa. – the ‘everyman’ politician and personal friend of Amtrak conductors – would rid the White House of crazy, restore normality to Washington and through decency and collegiality make government work again.  But Mr. Biden is now undermining the chance that voters will buy that this is the real Joe in 2024.

“The most obvious recent example is the president’s refusal to acknowledge his seventh grandchild, the result of his son Hunter Biden’s liaison in 2018 with a former stripper. Hunter says he doesn’t remember linking up with the child’s mother and refused to acknowledge he was the father or provide child support until a court-ordered test established his paternity.  In late June, Hunter came to an agreement with the girl’s mother to provide monthly child support and some of his paintings. In return the mother agreed not to use Biden as his daughter’s last name.

“If President Biden had acted with graciousness and opened his heart to his now four-year-old grandchild, he would have done himself much good.  Imagine if he had welcomed her into the family, introduced her to her cousins and treated her as a wonderful addition to the Biden line. Instead, he joined his son in rejecting her.

“It’s ugly, and there’s been serious blowback.  When a Democratic president loses New York Times columnist Maureen Dowd over a question of basic decency, you know he’s in trouble.

“It didn’t help matters that, the day after Hunter got a plea deal on federal income tax and gun charges, the president had his son attend the White House state dinner for Indian Prime Minister Narendra Modi.  Hunter’s grinning mug was splashed all over the coverage, reminding voters how easy he got off from his drug-and-alcohol addled years of squeezing cash out of foreign bad actors by trading on his father’s name and position.

“It would have been nice if Hunter had the decency to stay out-of-sight and out-of-mind, but his father at least should’ve had the common sense to nix what was a perfectly awful idea.  No one is asking the president to abandon his son like he has his granddaughter, but he doesn’t need to highlight Hunter at a state dinner, either.  If Hunter wants to help his father’s re-election, he should join an agricultural commune in Paraguay for the next 17 months.

“But that still wouldn’t end the damage to the president’s image.  In early July, voters learned from Axios that behind closed doors Mr. Biden is full of fury and foul-mouthed outbursts, a man who ‘has such a quick-trigger temper that some aides try to avoid meeting alone with him.’  This makes a mockery of his promise the first day of his presidency to fire ‘on the spot’ any employee who treated fellow staffers disrespectfully.

“These three nuggets might not by themselves cost Mr. Biden the 2024 election.  But he’s a weak, old and unpopular incumbent.  Diminishing what voters accepted as his authentic attributes – decency and likability – is bound to hurt.  In what’s shaping up to be another close contest, that could be more decisive than Democrats might think.”

Speaking of Maureen Dowd and her piece last Sunday in the Times, in part:

“Joe Biden’s mantra has always been that ‘the absolute most important thing is your family.’  It is the heart of his political narrative.  Empathy, born of family tragedies, has been his stock in trade.  Callously scarring Navy’s [Ed. the name of Hunter’s child with Lunden Roberts] life, just as it gets started, undercuts that.  As Katie Rogers, a Times White House correspondent, wrote in a haunting front-page piece last weekend about Hunter’s unwanted child, Biden is so sensitive ‘that only the president’s most senior advisers talk to him about his son.’  Rogers said that ‘in strategy meetings in recent years, aides have been told that the Bidens have six, not seven, grandchildren.’  Jill Biden dedicated her 2020 children’s book to the six grandchildren.

“What the Navy story reveals is how dated and inauthentic the 80-year-old president’s view of family is.

“Once you could get away with using terms like ‘out of wedlock’ and pretend that children born outside marriage didn’t exist or were somehow shameful.  But now we have become vastly more accepting of nontraditional families.  We live in an Ancestry.com world, where people are searching out their birth parents and trying to find relatives they didn’t know they had.

“I have sympathy for Hunter going into a ‘dark, bleak hole,’ as he called it.  I have sympathy for a father coping with a son who was out of control and who may still be fragile. With Hunter, his father can seem paralyzed about the right thing to do.

“But the president can’t defend Hunter on all his other messes and draw the line at accepting one little girl.  You can’t punish her for something she had no choice about.  The Bidens should embrace the life Hunter brought into the world, even if he didn’t consider her mother ‘the dating type.’

“The president’s cold shoulder – and heart – is counter to every message he has sent for decades, and it’s out of sync with the America he wants to continue to lead.”

--FBI Director Christopher Wray testified before Congress for hours Wednesday, defending his record and that of his agents as Republicans attacked what they called politically motivated investigations and threatened to take away some of the bureau’s budget or surveillance authority.

Speaking to the House Judiciary Committee, Wray sounded exasperated at times with both the criticisms and the premise behind them – that as a Republican appointed by President Donald Trump, he was nevertheless out to get Republicans.

“The idea that I’m biased against conservatives seems somewhat insane to me, given my own personal background,” Wray said.

--A divided House voted on Thursday to restrict abortion access, bar transgender health services and limit diversity training for military personnel, potentially imperiling passage of the annual defense bill as Republicans, fueled by their right flank, loaded the measure with conservative policy dictates that the Democratic Senate won’t approve.  The House vote was 221-213 to overturn a Pentagon policy guaranteeing abortion access to service members regardless of where they are stationed, with Republicans and their small majority getting passage over near-unanimous Democratic opposition.

This all comes to a head next week.

--Ray Epps, the Arizona man that conspiracy theorists falsely claim led an FBI plot to orchestrate the January 6 insurrection, filed a lawsuit on Wednesday against Fox News, accusing the right-wing channel and former host Tucker Carlson of defamation.

“In the aftermath of the events of January 6th, Fox News searched for a scapegoat to blame other than Donald Trump or the Republican Party,” the lawsuit said.  “Eventually, they turned on one of their own.”

In the aftermath of the Jan. 6, 2021, attack on the Capitol, conspiracy theorists baselessly suggested that the assault was a so-called “false flag” operation staged by the federal government to make supporters of then-President Donald Trump look bad.

As part of that conspiracy theory, some right-wing figures falsely claimed Epps was part of a secret FBI plot to orchestrate the attack.  Tucker Carlson, in particular, breathed life into those conspiracies by continually mentioning Epps and playing footage from January 6 of Epps outside the Capitol.

--The Secret Service is closing its investigation into who may have brought a plastic bag of cocaine into the White House this month after lab results were inconclusive about possible suspects.

The Secret Service sent the bag that had contained the powder to an FBI lab to look for traces of DNA and fingerprints, but neither form of testing yielded definitive results, the agency said.  Nor was any surveillance video found that provided any investigative leads, officials said.  There apparently was a blind spot when it came to viewing the cubby holes.

The Secret Service identified roughly 500 people who had entered the general area of the West Wing during the time before the July Fourth holiday and could have brought the cocaine inside the White House.

The rapid closure of the probe after 10 days prompted criticism from Republican lawmakers.

--Pope Francis on Sunday announced that he would elevate 21 churchmen to the high rank of cardinal, again putting his mark on the group that will one day choose his successor.  The ‘consistory’ to install them will be held on Sept. 30.  The new cardinals come from countries including the U.S., Italy, Argentina, Switzerland, South Africa, Colombia, South Sudan and Hong Kong.

Eighteen of the 21 are under 80 and will be able to enter an eventual secret conclave to choose the next pope.  They are known as cardinal electors.  After the September consistory, there will be 137 cardinal electors, about 73 percent of them chosen by Francis.  This increases the possibility tat the next pope will share his vision of a more progressive, inclusive Church. 

Francis has also increased the possibility that the next pope will come from Asia or Africa, having consistently named cardinal electors from those continents and giving less importance than his predecessor to countries in Europe.

One of the significant appointments was that of Bishop Stephen Chow Sau-Yan of Hong Kong.  Chow is one of the major links to the Catholic Church in communist China, where the Vatican is trying to improve conditions for Catholics.

--The U.S. Food and Drug Administration on Thursday approved the birth control pill Opill to be available over-the-counter – the first non-prescription birth control pill in the United States.

Dr. Patrizia Cavazzoni, the director of the FDA’s Center for Drug Evaluation and Research, said in a statement: “When used as directed, daily oral contraception is safe and is expected to be more effective than currently available nonprescription contraceptive methods in preventing unintended pregnancy.”

Opill is a “mini-pill” that uses only the hormone progestin.

--About the weather…Thursday represented Phoenix, Arizona’s 14th consecutive day with an air temp of 110 or higher, and it seems a certainty it will break the record 18 straight set in 1974.

Las Vegas could hit a record-tying 117 on Sunday, and Saturday through Tuesday could also tie a record-long streak of afternoon highs at or above 115.

Death Valley could challenge the highest temperature ever reliably measured on the planet, 130, this weekend.  Nighttime low temperatures in Death Valley are forecast to exceed 100 degrees.

Heat-indexes in the Deep South and Southeast could climb into the 110-120-degree range. Marathon Key, Fla., just netted its hottest five-day period on record, with an average afternoon high of 97.2 degrees and a heat index of 118 (Wednesday).  As noted up top, water temperatures off Florida are between 94 and 98 degrees in spots, which can not only fuel storms, but are threatening sensitive corals and marine life.

Spain is in the midst of an unrelenting heatwave as temperatures started to build towards what is forecast to be a torrid weekend across southern Europe.

Spain’s weather service said the thermometer could potentially hit 45 degrees C (113F) in an area near Granada.

Spain had a record hot year in 2022, as the Mediterranean region is expected to see temperatures rise faster than many other areas of the globe due to climate change.

Temperatures in Sicily and Sardinia could approach 118 degrees in the coming days, challenging the highest levels ever observed in Europe, according to the European Space Agency.

Canada’s farthest northern regions are seeing an unprecedented heat wave leading to some of the hottest days ever recorded.

The temperatures last weekend in the Northwest Territories (NWT) smashed previous records.  With a Saturday temperature of 37.4C (99F), Fort Good Hope in the Northwest Territories saw “the hottest temperature recorded that far north in Canada,” according to Environment Canada.  Meteorologist Jesse Wagar said, “Each summer is just getting hotter and hotter.”

Of the top five temperatures ever recorded in the NWT, four occurred in the past eight years, she says.

With a temperature of 37.9C (100.2F), the mercury in the community of Norman Wells just south of Fort Good Hope was just 0.1C lower than the hottest temperature recorded for the near-Arctic region, extreme-weather historian Christopher Burt told BBC News.  The reading there was just shy of the record set at a similar latitude in Verkhoyansk, Russia, in June 2020 of 38C.

Ottawa’s all-time high temperature is 37.8C – meaning that the temperature in Norman Wells was higher than the highest record seen in a city with a latitude 1,400 miles to its south.

The World Meteorological Organization said the first week of July was the hottest ever recorded on the planet, after the hottest June on record, said the UN body.

Japan’s Kyushu, the country’s southernmost main island, endured its “heaviest rain ever experienced” on Monday, the Japan Meteorological Agency said.  At least six people died, with others missing.

In India, the death toll from landslides and floods in the north rose to at least 90.

Last Sunday, New Delhi had its wettest July day in four decades (and this is the month for the monsoon to begin with).

And in Vermont, two months’ worth of rain fell on much of the state in just hours (9 inches+), causing “historic and catastrophic” flooding in the capital city of Montpelier, and countless other parts of this beautiful state. 

New York’s Hudson Valley and western New Hampshire also saw significant damage.

And now more heavy rain is forecast for the affected areas this weekend.

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

Pray for Ukraine.

God bless America.

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Gold $1959
Oil $75.24

Regular Gas: $3.56; Diesel: $3.85 [$4.60 / $5.59 yr. ago]

Returns for the week 7/10-7/14

Dow Jones  +2.3%  [34509]
S&P 500  +2.4%  [4505]
S&P MidCap  +2.7%
Russell 2000  +3.6%
Nasdaq  +3.3%  [14113]

Returns for the period 1/1/23-7/14/23

Dow Jones  +4.1%
S&P 500  +17.3%
S&P MidCap  +10.0%
Russell 2000  +9.6%
Nasdaq  +34.9%

Bulls 51.4
Bears 18.1

Hang in there.

Brian Trumbore

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