Week in Review

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Week in Review

09/21/2024

For the week 9/16-9/20

[Posted 4:30 PM ET, Friday]

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Special thanks to George R. for his longtime support....

Edition 1,326

The information war continues as we approach the election, the FBI and other federal agencies saying Iran is trying to help Kamala Harris, given its hatred of Donald Trump, while Russia is doing what it can to aid Trump and defeat the vice president.

Some of the efforts have been rather amateurish, cut and paste videos that are clearly fake, but they still get millions of views and have some influence on voters.

“As the election approaches, people get more heated,” Clint Watts, general manager of the Microsoft Threat Analysis Center said in an interview with the Associated Press this week.  “People tend to take in information from sources they don’t really know or wouldn’t even know to evaluate.”

Russia and Iran, along with China, are doing their best to divide us and it’s been working.

Today is a significant day, as Minnesota, South Dakota and Virginia begin early voting, while several other states will start sending out their absentee ballots.

Postmaster General Louis DeJoy said the U.S. Postal Service would undertake “heroic efforts” to deliver mail-in ballots on time but still recommended that voters mail theirs at least one week before Election Day on Nov. 5.

In the end, as the great pollster Frank Luntz put it: “It’s (still) all about inflation, affordability, housing, fuel, and food.” 

Personally, I’m dreading Election Day and some of the rhetoric we will hear late into the evening and in the days after.  Few follow my dictum of ‘wait 24 hours.’  And today we learned that Georgia’s State Election Board voted 3-2 to force counties to hand-count all ballots cast on Nov. 5, a move that could significantly delay the reporting of results in this battleground state. [Other provisions have passed recently that further the chances of a real s---show in Georgia.]

You can already see what will then happen.  Counties supporting Trump will report first, he’ll have a lead, he’ll declare victory Tuesday night, and then election ‘fraud’ if the final result days later is contrary to his narrative.

In the meantime, we have the following, still-developing story....

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Israel-Hamas-Hezbollah...from the start of the week....

--Sunday, the Houthis hit Israel with a ballistic missile, reaching a central area from some 1,200 miles away with such a missile for the first time.  The missile was intercepted and did no harm...no reports of casualties or major damage, but Israeli media aired footage showing people racing to shelters in Ben Gurion International Airport.

As the Wall Street Journal opined: “The attack underscores that the Houthis are undeterred by American denunciations and pinprick responses to their assault on commercial shipping in the Red Sea region. The Houthis are allies of Iran, which provides them with weapons, including missiles.”

Prime Minister Benjamin Netanyahu vowed the Houthis would pay a “heavy price” for the attack, citing Israeli retaliation in July on the Yemeni port of Hodeida after a Houthi drone attack on Tel Aviv that killed one person and wounded 10 others.

WSJ: “The U.S. should have long ago taken stronger action against the Houthis, as well as against Iran for supplying missiles to Russia and the Houthis.

“But President Biden fears escalation, and so Israel has to live with Houthi attacks while U.S. Navy commanders in the region play defense against Houthi assaults.  The civilized world is losing its war with the Houthis and Iranians, and imagine what they will do when Iran gets nuclear weapons.  The ‘heavy price’ will be paid by the rest of the world.”

--Also Sunday, the Israeli military said there was a “high probability” that three hostages found dead months ago were killed in an Israeli airstrike.  The strike back in November also killed a senior Hamas militant.

--Monday, Palestinian officials said Israeli airstrikes killed 16 people in the Gaza Strip, including five women and four children. 

--Tuesday, Israel announced that halting Hezbollah’s attacks in the north in order to allow its residents, some 60,000, to return is now an official war goal, as the country considered a wider military operation that could ignite an all-out conflict.

Hezbollah has fired more than 8,000 rockets and missiles at Israel since Oct. 7.  Israeli Defense Minister Yoav Gallant said that “military action” was the only way of returning residents to the north.

Israel has regularly launched airstrikes in response and has targeted and killed senior Hezbollah commanders.  As recently as last month it appeared a full-blown war was imminent.

At the same time there were media reports that Netanyahu was considering firing Gallant and replacing him with a politician seen as far more hawkish.

So that was how Tuesday started out...Israel was going to have to confront Hezbollah more intensely in order to be able to move its 60,000 displaced civilians back to northern Lebanon.

And then...the story broke that thousands of pagers, of all things, were exploding throughout Lebanon, targeting Hezbollah militants and causing massive injuries.  At last word, the death toll had risen to 12, more than 2,300 injured (revised downward from 4,000 by the Lebanese health ministry), many critically.  Among the injured was Iran’s Ambassador to Lebanon, Mojtaba Amani, who lost an eye.

Only Israel could have carried out such a sophisticated attack.

The following is a terrific explanation of the action and the potential consequences, writ large.

David Ignatius / Washington Post

“The scene in Lebanon on Tuesday was like something out of a bizarre James Bond movie – with pagers exploding simultaneously in the pockets of hundreds of Hezbollah fighters around the country in what appeared to be an ingenious Israeli operation that combined cyberwar with sabotage.

“But Hezbollah gets to write the next chapter in this real-life thriller.  And Israeli officials were preparing Tuesday night for retaliatory attacks that, if not contained, could trigger all-out regional war U.S. officials have been trying to head off for nearly a year.

“Israel didn’t take credit for Tuesday’s attack, but it didn’t need to.  An attack of this sophistication and daring in Lebanon could not have been staged by any other nation.  The video scenes of Hezbollah fighters blown to the floor by their own communications devices sent an unmistakable Israeli message to the Iranian-backed militia: We own you.  We can penetrate every space in which you operate.

“ ‘When Hezbollah considers how to respond, they should consider that Israel may have more surprises for them. And Israel does,’ said one source familiar with Israeli thinking, during an interview on Tuesday....

“For President Biden and Kamala Harris, the timing couldn’t be worse: This sharp escalation and risk of a wider war comes less than two months before the presidential election – and it might detonate any chance of a Gaza cease-fire deal and the release of Israeli hostages.

“U.S. officials were in contact with Iran through a back channel on Tuesday to convey that the United States did not have any role in the attack.  The administration’s sense, for now, is that Hezbollah is confused and panicked, and that it won’t make an immediate military response. If there is no attack, U.S. officials believe Israel can contain the damage – and that, if necessary, the United States will help defend Israel.

“Israel’s apparent decision to launch the attack was probably driven by both political and operational factors. The U.S.-led cease-fire plan is stalled, and with it the hope of a diplomatic deal with Hezbollah to calm the border. And having developed the extraordinary ability to turn their adversary’s communications devices into bombs, Israel might have judged that this capability must be used before it could be discovered and the pagers disarmed, as the newsletter Al Monitor reported on Tuesday night....

“The ingenuity of the pager attack was Israel’s apparent penetration of Hezbollah’s secretive supply chain – which had distributed the exploding devices. The group’s leader, Hassan Nasrallah, had warned his operatives in a February speech to stop using cellphones, which had ‘become like everyone’s oxygen,’ but which gave away the fighters’ positions and sometimes acted as Israeli spying devices.

“ ‘Israel no longer needs collaborators,’ Nasrallah said.  ‘Its surveillance devices are in your pockets. If you are looking for the Israeli agent, look at the phone in your hands and those of your wives and children.’  Nasrallah knew that mobile devices send signals to commercial cellphone towers that can easily be intercepted.

“Hezbollah rushed to protect its military network by providing members with special pagers that used a system that was harder to crack.  The militia surely never imagined that Israeli operatives could penetrate their supply chain for the pagers.  But that’s what appears to have happened, U.S. cyber experts told me.  Hezbollah sent a telling message late Tuesday to its operatives: ‘Each one who received a new pager, throw it away,’ according to a source quoted by The Post.”

It seems “Israeli agents managed to get access to the pagers before they were distributed and inserted small amounts of very powerful explosives.  Malware inserted into the pagers’ operating system likely created a cyber trigger, so that when the pagers received a call from a particular number – or some other signal – the explosives detonated, the sources said....

“Beyond its devastating effect on Hezbollah, the attack signals the beginning of a new and very dangerous era in cyberwarfare.  Any device that is connected to the internet can potentially be transformed into a weapon.  The circuits of a ‘smart’ appliance can be manipulated so that they malfunction in a dangerous way.  In the Stuxnet cyberattack against Iran’s nuclear program, malware caused centrifuges to spin so wildly that they became unstable and self-destructed.  In the future of what’s called the ‘Internet of Things,’ the errant device could be your phone, refrigerator or television.

“With each new advance of weapons technology, designers imagine they’ll have exclusive use of the deadly tools of war. The United States once had what seemed a monopoly on drones, for example, but they’re now a pervasive instrument of war.  Even the audacious 007 would know that his enemies can turn his weapons against him.”

For the record, Taiwanese pager manufacturer Gold Apollo on Wednesday said that it did not make the devices used by Hezbollah. But the company said in a statement that while it did not manufacture the AR-924 pagers, they were “entirely handled” by a company called BAC Consulting Kft, a Hungarian company that was authorized to use Gold Apollo’s brand trademark in some regions, it said.

We then learned, via media reports, that the Hungarian company was an Israeli front operation and that the explosives were added in the manufacturing process.

And then on Wednesday, new explosions in walkie-talkies occurred, killing at least 25 and injuring more than 600 across Lebanon.  At least one of the explosions occurred at a funeral in Beirut’s southern suburbs, held by Hezbollah for people who were killed in Tuesday’s blast.

“Anyone who has a device, take out the battery now!” Hezbollah security members yelled to mourners.  “Turn off your phones, switch it to airplane mode” young men in black T-shirts and khakis shouted.

The Pentagon was increasingly concerned that the wave of explosions was a prelude to a ground war in southern Lebanon.  Even before the attacks Tuesday and Wednesday, this was the fear of Defense Secretary Lloyd Austin.

Defense Minister Gallant said his country was “opening a new phase in the war,” with a center of gravity “shifting to the north,” after the second day of exploding communication devices.

But why did Israel act now, if it wasn’t prelude to a ground war?  “Arab security services speculated that Hezbollah had discovered a problem with the beepers and that Israel faced a ‘use it or lose it’ moment.  Otherwise, the timing of the attack made little sense, several officials said,” as reported by the Washington Post.

Prime Minister Netanyahu pledged in a recorded video Wednesday that Israel would “safely return the residents of the north to their homes.”

Israel Defense Forces Chief of Staff Herzi Halevi approved “offensive and defensive” plans for the northern border, the military said in a statement Wednesday.  Troops are being transferred from Gaza to the north.

But the United States is applying “a lot of pressure” on Israel not to initiate a regional conflagration, according to former senior Mossad operative Oded Eilam, in an interview with the Post.

Thursday, Israel and Hezbollah exchanged strikes along the Israel-Lebanon border as Hezbollah’s Hassan Nasrallah vowed retaliation for the attacks on his group.

“The enemy will face a severe and fair punishment from where they expect and don’t expect,” Nasrallah said.  “I will not speak about time, or form, or place.”

Nasrallah said that the attack on the group’s communications devices in Lebanon and Syria was a “severe and cruel blow” and said Israel had crossed a “red line.”  But he vowed the group would emerge stronger and continue its daily strikes into northern Israel.

As the militant leader spoke in a televised speech from an undisclosed location, Israeli war planes flew low over Beirut and broke the sound barrier, scattering birds and prompting people in houses and offices to quickly open windows to prevent them from shattering.

Israel said it struck hundreds of Hezbollah rocket launchers that had been set to fire towards Israel, some 1,000 rockets, in what security sources in Lebanon said was the heaviest such attack since hostilities began last October.

Friday, UN peacekeepers in Lebanon urged immediate de-escalation as hostilities rumbled on at the border, and the airstrikes continued, Israel hitting at least three villages in south Lebanon.

Hezbollah fired a guided missile at Israeli troops in Metula, an Israeli town on the border targeted frequently over the last year. The IDF reported two Israeli soldiers were killed and a third seriously wounded.

That was in the morning.  Friday afternoon local time, Israel carried out what it called a “targeted” strike in the Lebanese capital of Beirut.  The Lebanese Health Ministry said at least 14 people were killed and dozens injured, as I go to post, as a top Hezbollah official was the prime target. 

It was not immediately clear if the commander, Ibrahim Aqeel, was among the casualties, but Israel said he was, along with other senior commanders.  Aqeel was blamed by the United States for involvement in two terrorist attacks in 1983 that killed more than 300 people at the U.S. Embassy in Beirut and the U.S. Marine Corps barracks.  Last year, the State Department posted a $7 million reward for information leading to his identification, location, arrest or conviction.  It said Aqeel had also directed the taking of American and German hostages in Lebanon in the 1980s, and served on Hezbollah’s highest military body, the Jihad Council.

It seems there was another serious security breach, as Aqeel was apparently in a meeting with other Hezbollah officials when Israel struck.

Hezbollah had fired 140 rockets at northern Israel, by the time of the strike on Beirut.  Israel said the rockets came in three waves, targeting the Golan Heights, Safed and the Upper Galilee.  Some of the Katyusha rockets were intercepted, but not all it seems.  Hezbollah said it was targeting multiple air defense bases as well as the headquarters of an Israeli armored brigade they said they’d struck for the first time.

[On a personal note, when you fly into Beirut International Airport, to get to the nice part of town, where I stayed in my two trips, 2005 and 2010 (the Intercontinental Phoenicia Hotel), which was the site of the horrific terror attack on former Prime Minister Rafik Hariri, for whom the airport is named, and his entourage in 2005, your drive takes you through (over) the Hezbollah stronghold so I’m picturing the chaos that enveloped that neighborhood this week.]

--Israeli forces killed at least 14 Palestinians in tank and air strikes on north and central areas of the Gaza Strip on Friday.  It wasn’t known if the casualties were militants or civilians.

--The Wall Street Journal reported Friday that “After months of saying a cease-fire and a hostage-release deal was close at hand, senior U.S. officials are now privately acknowledging they don’t expect Israel and Hamas to reach an agreement before the end of President Biden’s term.”

“No deal is imminent,” one of the U.S. officials said.  “I’m not sure it ever gets done.”

“Officials cited two main reasons for the pessimism.  The ratio of Palestinian prisoners that Israel must release to bring Hamas-held hostages home was a major sticking point – even before the U.S.-designated terrorist group killed six hostages, including an American citizen. And the two-day attack on Hezbollah...followed by Israeli airstrikes the next two – has made the possibility of all-out war much more likely, complicating diplomacy with Hamas.

“Another problem is that, according to Biden administration officials, Hamas makes demands and then refuses to say ‘yes’ after the U.S. and Israel accept them. The intransigence has severely frustrated negotiators, who increasingly feel the militant group isn’t serious about completing an agreement.”

An official from an Arab country added shortly after this week’s operation against Hezbollah, “Everyone is in a wait-and-see mode until after the election.  The outcome will determine what can happen in the next administration.”

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Russia-Ukraine....

--Going back to last Friday in Washington, D.C., British Prime Minister Keir Starmer met with President Briden amid the rising tensions with Russia, reaffirming their support for Ukraine but declining to publicly address urgent questions over whether Biden will pave the way for Ukraine to use Western-made weapons to strike deeper inside Russia.

“We don’t seek any conflict with Russia. That’s not our intention in the slightest,” Starmer said to British reporters ahead of the meeting with Biden.  “But they started this conflict, and Ukraine’s got a right to self-defense.”

The British government accused Russia of “a significant escalation” by imported ballistic missiles from Iran, saying that it was “bolstering Putin’s capability to continue his illegal war.”

But Starmer was unable to convince Biden on allowing Ukraine to fire long-range missiles into Russia.

Some senior congressional leaders have been urging Biden to make a shift, saying Ukraine needs a freer hand.

“In light of Putin’s increasingly horrific attacks on civilian targets, it’s time to lift restrictions on the use of long-range U.S.-provided weapons to allow Ukraine to reach high value Russian military targets,” Sen. Jeanne Shaheen (D-N.H.) said in a recent statement.  “On the expectation that the Ukrainian government has demonstrated how these new authorities fit within its broader campaign strategy, I hope that the Biden Administration will swiftly grant these permissions to the Ukrainian Armed Forces.”

--A Russian-guided bomb struck a multistory apartment building on Sunday in Kharkiv, triggering a fire and killing one and injuring 42, officials said.  Once again, President Zelensky pleaded for more air defense systems and permission to use weaponry on targets deep inside Russia to save lives.

Also Sunday, two people died in a missile attack on the Ukrainian Black Sea port city of Odesa, local officials said, as Moscow and Kyiv exchanged drone and missile attacks.

The Ukrainian air force said Sunday it shot down 10 of the 14 drones and one of the three missiles Russia launched overnight.

The Russian Defense Ministry said it downed 29 Ukrainian drones overnight into Sunday over western and southwestern regions, with no damage caused by falling debris.

--A partial evacuation was ordered in Russia’s Tver region after a “massive” Ukrainian drone attack sparked a fire there, the local governor said.  Reuters reported unverified footage purportedly showed a massive blast in the town, amid unconfirmed reports that a weapons depot was hit overnight Tuesday.

Attacks were also reported in Russia’s western Bryansk, Kursk, Oryol and Smolensk regions.

Russia sent drones near Kyiv, and blasts were reported in the northeastern city of Sumy, near the Russian border.  It wasn’t clear if there were any casualties on either side.

But then we learned that the explosions in the Tver region were indeed “massive,” with regional earthquake monitors even picked up by the blast, which registered as a 2.8 magnitude quake.  It was a large Russian ammunition depot.  Six Ukrainian kamikaze drones were allegedly used in the attack.

“We’re likely looking at the loss of thousands of tons of explosive materials, shells, and rockets,” one former Ukrainian officer said, noting, “In events of this magnitude, replacement can’t be quick.”

--A Russian guided aerial bomb hit a nursing home in Sumy, Thursday, killing one person and injuring 12 others, the Ukrainian Interior Ministry said.

Sumy is a big target as it is the city from which the Ukrainian Army launches assaults across the border into the Kursk region.

--A Ukrainian military officer told the BBC near the front-line south of Pokrovsk that the situation is critical.  Russia’s strategy now appears to be surrounding the city, which is a key transportation hub.

The officer, who preferred to stay anonymous, said his military leadership want to hold their positions at all costs, often leading to the loss of troops and resources.

That approach, he says, was resulting in a number of “cauldrons,” large territories surrounded by the Russian forces.

“When your enemy has more people and resources than you do, this strategy is reckless,” the Ukrainian officer added.

--Vladimir Putin on Monday ordered the regular size of the Russian army to be increased by 180,000 troops to 1.5 million active servicemen in a move that would make it the second largest in the world after China’s.

In a decree published on the Kremlin’s website, Putin ordered the overall size of the armed forces to be increased to 2.38 million, of which he said 1.5 million should be active servicemen.

According to data from the International Institute for Strategic Studies, a leading military think tank, such an increase would see Russia leapfrog the United States and India in terms of the number of active combat soldiers it has at its disposal and be second only to China in size.  The IISS said Beijing has just over 2 million active-duty service personnel.

Both sides in the war have been sustaining heavy battlefield losses.  And this week, a Wall Street Journal report noted: “A confidential Ukrainian estimate from earlier this year put the number of dead Ukrainian troops at 80,000 and the wounded at 400,000.”  But for a country with a prewar population of just under 50 million, “Russia’s invasions and capture of Ukrainian territory over the past decade have caused Ukraine to lose at least 10 million people under occupation or as refugees.” (Russia, by contrast, had a prewar population of just under 150 million and that number is not believed to have declined greatly since.)

But Kyiv’s concerns extend beyond those lost defending against the invasion.  Indeed, “In the first half of this year, three times as many [Ukrainians] died as were born,” according to government data. And similarly, “One of the key reasons President Zelensky refuses to mobilize the key cohort of men aged between 18 and 25 – typically the bulk of any fighting force – is because most of these people haven’t had children yet,” the Journal reports.

The big question: “For Ukraine, the dilemma is existential: How many people can you lose in a war before losing your future?” said political scientist Ivan Krastev.

Regarding Russia’s casualties, the Journal noted: “Western intelligence estimates of Russian casualties vary, with some putting the number of dead as high as nearly 200,000 and wounded at around 400,000.

The BBC said Friday that its analysis of obituaries published in the Russian media puts the death toll at 70,000 Russian soldiers killed in Ukraine, “but the actual number is believed to be considerably higher.  Some families do not share details of their relatives’ deaths publicly,” and the figure doesn’t include names or the deaths of militia in Russian-occupied Donetsk and Luhansk in eastern Ukraine.

--Artillery shells sold by Indian arms makers have been diverted by European customers to Ukraine and New Delhi has not intervened to stop the trade despite protests from Moscow, according to eleven Indian and European government and defense industry officials, per a Reuters analysis of commercially available customs data.

--Russia is seeking “a decisive victory in Ukraine by 2026,” Kyiv’s military intelligence chief, Lt. Gen. Kyrylo Budanov, said last weekend at the 20th Yalta European Strategy meeting hosted in Ukraine’s capital city.

What’s driving that goal: “Russia anticipates a worsening economic and socio-political situation by mid-2025, alongside increasing difficulties with military recruitment,” analysts at the Washington-based Institute for the Study of War write in their latest assessment. “Budanov assessed that mounting issues will force Russian President Vladimir Putin to make a critical decision: either launch another risky and controversial mobilization or reduce the intensity of combat operations in Ukraine.”

Worth noting: “Budanov’s assessment implicitly assumes that Western states will retain support for Ukraine at current levels over the next one to two years,” ISW writes.  But that’s far from a certainty; and with the U.S. election coming up, things could change substantially depending on what happens in November.

Budanov also credited North Korean weapons with most directly and rapidly disrupting the war in Ukraine, including its reported delivery of 4.8 million artillery shells to Russia this past June.

How long can Russia sustain the invasion? According to ISW, “The Russian government will likely have to further mobilize the Russian economy and defense industry and invest in capacity building if the Russian military intends to sustain its current tempo of operations in the medium- to long-term as Russia depletes its finite Soviet stockpiles, but it is unclear if the Russian defense industry will be able to produce enough to sustain the high level of equipment losses that Russian forces suffer in Ukraine even with further economic mobilization.”

David Ignatius of the Washington Post was at the above-mentioned Yalta strategy meeting and had these observations:

“(I) came away from the conference thinking the United States should take more risks to help Ukraine. It matters how this war ends.  If Putin prevails, it will harm the interests of America and Europe for decades.

“ ‘I have no announcement to make’ on the ATACMS [ed. long-range missiles] issue, national security adviser Jake Sullivan said in a video interview with the group. That’s fine with me.  Don’t announce anything.  Leave Putin guessing.  But if Russia’s surge continues, Putin’s bases within ATACMS range should be legitimate targets.  He’s the one crossing the ‘red line’ every day he continues his unprovoked aggression.

“Zelensky, clad as always in a green combat shirt, said the proper range for U.S.-supplied weapons should be ‘long enough to act as a game changer and make Russia seek peace.’  He’ll meet Biden in a week in New York to make that plea in person. I hope Biden says yes, privately.

“If Zelensky is wise, he’ll bring along Oleksander Budko, a wounded veteran who spoke to the group.  Though he lost both of his legs in combat, the boyishly handsome Budko was recently chosen as ‘Ukraine’s most desirable man’ on a national television show.  That’s the spirit that sustains Ukraine in this dark moment, and it’s moving to see.

“But it’s not sentimentality that underlies deeper American support for Ukraine, but U.S. national interest.”

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Walter Russell Mead / Wall Street Journal

“The news from abroad is chilling.  Washington Post columnist David Ignatius reports from Kyiv that Ukraine is ‘bleeding out’ as its weary soldiers struggle against a numerically superior Russia.  The New York Times reports that China is expanding the geographical reach and escalating violence in its campaign to drive Philippine forces from islands and shoals that Beijing illegitimately claims. And Bloomberg reports that Washington officials are fearful that Russia will help Iran cross the finish line in its race for nuclear weapons.

“These stories, all from liberal news outlets generally favorable to the Biden administration, tell a tragic and terrifying tale of global failure on the part of the U.S. and its allies.  China, Russia and Iran are stepping up their attacks on what remains of the Pax Americana and continue to make gains at the expense of Washington and its allies around the world.

“What none of these stories do is connect the dots by analyzing the consequences of repeated American failure on the widely separated fronts of the international contest now taking place. To see what this all means and where it is leading we must turn to the recently released report of the Commission on the National Defense Strategy. This panel of eight experts, named by the senior Republicans and Democrats on the House and Senate Armed Services committees, consulted widely across government, reviewing both public and classified information, and issued a unanimous report that, in a healthy political climate, would be the central topic in national conversation.

“The bipartisan report details a devastating picture of political failure, strategic inadequacy and growing American weakness in a time of rapidly increasing danger.  The U.S. faces the ‘most serious and most challenging’ threats since 1945, including the real risk of ‘near-term major war.’  The report warns: ‘The nation was last prepared for such a fight during the Cold War, which ended 35 years ago.  It is not prepared today.’

“Worse, ‘China and Russia’s ‘no-limits’ partnership, formed in February 2022 just days before Russia’s invasion of Ukraine, has only deepened and broadened to include a military and economic partnership with Iran and North Korea...This new alignment of nations opposed to U.S. interests creates a real risk, if not likelihood, that conflict anywhere could become a multitheater or global war.’

“Should such a conflict break out, ‘the Commission finds that the U.S. military lacks both the capabilities and the capacity required to be confident it can deter and prevail in combat.’

“To summarize, World War III is becoming more likely in the near term, and the U.S. is too weak either to prevent it or, should war come, to be confident of victory.

“A more devastating indictment of a failed generation of national leadership could scarcely be penned....

“Not since the 1930s have Americans been this profoundly indifferent as a great war assembles in the world outside, and not since Paul Revere traversed the dark country lanes of Massachusetts have Americans more urgently needed to rouse themselves from sleep.”

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Bret Stephens / New York Times

“What does Kamala Harris think the United States should do about the Houthis, whose assaults on commercial shipping threaten global trade, and whose attacks on Israel risk a much wider Mideast war? If an interviewer were to ask the vice president about them, would she be able to give a coherent and compelling answer?

“It’s not an unfair or unprecedented question.  As a presidential candidate, George W. Bush was quizzed on the names of the leaders of Taiwan, India, Pakistan and Chechnya.  He got one right (Taiwan’s Lee Teng-hui) but drew blanks on the rest.  It fueled criticism, as The Times’ Frank Bruni reported in 1999, that ‘he is not knowledgeable enough about foreign policy to lead the nation.’

“A few more questions for Harris: If, as president, she had intelligence that Iran was on the cusp of assembling a nuclear weapon, would she use force to stop it?  Are there limits to American support for Ukraine, and what are they?  Would she push for the creation of a Palestinian state if Hamas remained a potent political force within it?  Are there any regulations she’d like to get rid of in her initiative to build three million new homes in the next four years?  What role, if any, does she see for nuclear power in her energy and climate plans?  If there were another pandemic similar to Covid-19, what might her administration do differently?

“It may be that Harris has thoughtful answers to these sorts of questions. If so, she isn’t letting on.  She did well in the debate with Donald Trump, showing poise and intelligence against a buffoonish opponent.  But her answers in two sit-down interviews, first with CNN’s Dana Bash and then with Brian Taff of 6ABC in Philadelphia, were lighter than air.  Asked what she’d do to bring down prices, she talked at length about growing up middle-class among people who were proud of their lawns before pivoting to vague plans to support small business and create more housing.

“Lovely.  Now how about interest-rate policy, federal spending and the resilience of our supply chains? ....

“For what my vote is worth – very little, considering I live in New York – I’d much rather cast a ballot for Harris than stay home. But votes need to be earned.

“It should not be hard for Harris to demonstrate that she can give detailed answers to urgent policy questions.  Or to express a sense, beyond a few canned phrases, of how she sees the American interest in a darkening world. Or to articulate a politics of genuine inclusion that reaches out to tens of millions of distrustful voters.  Or to prove that she’s more than another factory-settings liberal Democrat whose greatest virtue, like her greatest fault, is that she won’t step too far from the conventional wisdom.

“Seven weeks to go.  Here’s hoping.”

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Wall Street and the Economy

This week it was all about the Federal Reserve and its Open Market Committee meeting on Tuesday and Wednesday.  We knew an interest rate cut was coming; we just didn’t know if it would be a quarter- or a half-point.  I thought it was going to be a quarter, but sentiment was changing end of last week and then Monday and Tuesday for a full half.  And that’s what the Fed delivered.

But in terms of movement in the bond market, it was a classic ‘buy the rumor, sell the fact,’ as the yield on the 10-year moved higher, traders having long discounted the Fed cut, with future ones in the cards.

Stocks, on the other hand, liked the Fed’s aggressiveness and the Dow Jones and S&P 500 hit new highs.

The Fed said in its statement:

“Recent indicators suggest that economic activity has continued to expand at a solid pace. Job gains have slowed, and the unemployment rate has moved up but remains low. Inflation has made further progress toward the Committee’s 2 percent objective but remains somewhat elevated.

“The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run.  The Committee has gained greater confidence that inflation is moving sustainably toward 2 percent, and judges that the risks to achieving its employment and inflation goals are roughly in balance.  The economic outlook is uncertain, and the Committee is attentive to the risks to both sides of its dual mandate.

“In light of the progress on inflation and the balance of risks, the Committee decided to lower the target range for the federal funds rate by ½ percentage point to 4 3/4-5 percent.”

Eleven members of the FOMC voted for the policy action, with one dissenter, Michelle Bowman, who preferred to lower the target range by a ¼-point.

Fed officials also penciled in more rate cuts by year’s end in their latest economic forecasts, another half-point, compared to the single cut in 2024 that they projected in June.  And central bankers also expect unemployment to rise higher this year to 4.4%, up from the current rate of 4.2% as of August.

Inflation has indeed come way down from the 40-year highs seen in the summer of 2022 – all without a recession.  But the Fed has been walking a fine line in taming price pressures without sacrificing America’s job market.

At his news conference, Fed Chair Jerome Powell said: “We know that it is time to recalibrate our (interest rate) policy to something that’s more appropriate given the progress on inflation.”

Powell was pressed about whether the Fed’s decision to cut by an unusually large half-point is an acknowledgement that it waited too long to begin cutting rates.

“We don’t think we’re behind,” he replied.  “We think this is timely. But I think you can take this as a sign of our commitment not to get behind. We’re not seeing rising claims, not seeing rising layoffs, not hearing from companies that’s something that’s going to happen.”

In an updated set of projections, the Fed’s policymakers now collectively envision a faster drop in inflation than they did three months ago but also higher unemployment.  They foresee their preferred inflation gauge (PCE) falling to 2.3% by year’s end, from its current 2.5%, and to 2.1% by the end of 2025.

The Fed’s next policy meeting is Nov. 6-7 – immediately after the election.  By cutting rates this week, and by 50 basis points to boot, before the election, the Fed risked attacks from Donald Trump, who has argued that lowering rates now amounts to political interference.

Meanwhile, on the economic data front, August retail sales rose 0.1%, ditto ex-autos, the former better than expected.  August industrial production was up a much better than forecast 0.8%.

August housing starts beat consensus at 1.356 million, annualized, while August existing home sales were down a bit, 3.860 million, -2.5% month-over-month, and down 4.2% year-over-year.  The median existing home price was $416,700, up 3.1% Y/Y.

The Atlanta Fed’s GDPNow barometer for third-quarter growth is at 2.9%.

Freddie Mac’s 30-year fixed-rate mortgage is down to 6.09%, lowest since Feb. 2023, but this could be the low for a while.

Editorial / Wall Street Journal

“Kamala Harris says the Biden Administration rescued the U.S. economy.  The truth is that the Biden inflation has left most Americans worse off than they were before the pandemic.  The latest evidence comes from Tuesday’s Census Bureau report on household income, poverty and health coverage in 2023.

“The good, and maybe the only good, news is that the median inflation-adjusted household income increased last year for the first time since 2019.  However, Hispanics, Asians and blacks didn’t experience statistically significant income growth.

“Real median earnings for full-time workers last year declined 1.6% and even more for high-school grads (3.3%). This means inflation outpaced wage gains for most low-wage workers.  One culprit may be that workers logged fewer hours and less overtime as the labor market started to soften, especially in leisure, hospitality and manufacturing.

“The upshot is that real median household income remains lower than in 2019 and has barely grown since 2020.  The contrast between the first three years of the Trump and Biden presidencies is striking.

“Between 2016 and 2019, incomes climbed for Asians ($14,600), whites ($8,910), Hispanics ($6,960), and blacks ($4,540).  The gains were comparatively modest from 2020 to 2023: Asians ($1,500), whites ($850), Hispanics ($700), and blacks ($2,650).  Because Covid reduced incomes in 2020, this comparison, if anything, flatters the Biden record....

“The Administration is trying to put a shiny gloss on the report.  ‘Today’s reports show we are making real progress growing the middle class,’ the White House says.  Talk about defining progress down.  America’s middle class has seen their incomes after inflation stagnate during the Biden Presidency.

“The White House also boasts that ‘health insurance coverage reached record highs,’ but the share of uninsured was the same in 2023 as in 2019, according to the Census report. The difference is that fewer Americans now have private insurance (-2.6%), while more are covered by Medicare (0.8%) and Medicaid (1.7%).

“All told, federal healthcare spending has increased by more than $500 billion since 2019, yet this money hasn’t bought better health or coverage.  The Administration has dangled more money for states to expand Medicaid for working-age, healthy adults under ObamaCare.  Small employers have responded by paring back their health coverage.

“The Census report explains why so many Americans are sour on the Biden economy.  The facts back them up.”

Separately, the Journal had a piece on the budget deficit, which is on track to top $1.9 trillion, or more than 6% of economic output, a threshold reached only around World War II, the 2008 financial crisis and the Covid-19 pandemic.

“If Congress does nothing, the total debt will climb by another $22 trillion through 2034, interest costs alone are poised to exceed annual defense spending.”

As for the candidates, there have been only sporadic mentions of the fiscal trajectory.

“Vice President Kamala Harris...and GOP rival Donald Trump aren’t the same on fiscal policy. She has outlined or endorsed enough fiscal measures – tax increases or spending cuts – to plausibly pay for much of her agenda.  He has not.

“Still, both Harris and Trump were parts of administrations that helped produce those deficits. Both have promised to protect the biggest drivers of rising spending – Social Security and Medicare. And both want to extend trillions of dollars in tax cuts set to lapse at the end of 2025, amid bipartisan agreement that federal income taxes shouldn’t rise for at least 97% of households.”

The Journal listed the amounts each administration has contributed to the national debt, adjusting for the fact presidents generally don’t have any control over the budget during their first year in office because it’s already set in stone by the previous president.

Joe Biden, 2021 – present...$6.66 trillion

Donald Trump, 2017-2021...$8.18 trillion

Barack Obama, 2009-2017...$8.34 trillion

George W. Bush, 2001-2009...$6.1 trillion

Bill Clinton, 1993-2001...$1.4 trillion

Lastly, the House on Wednesday rejected Speaker Mike Johnson’s proposal that would have linked temporary funding for the federal government with a mandate that states require proof of citizenship when people register to vote.

Next steps on government funding are uncertainties, but Congress needs to approve a stopgap measure to prevent a partial shutdown when the new budget year begins Oct. 1.

The vote was 220-202, with 14 Republicans and all but three Democrats opposing the bill.

“We’ll draw up another play and we’ll come up with a solution,” Johnson said.  “I’m already talking to colleagues about their many ideas. We have time to fix the situation, and we’ll get right to it.”

You don’t have that much time, Mr. Speaker.

Europe and Asia

Eurostat released its annual inflation figures for August in the eurozone, 2.2%, down from 2.6% in July.  Ex-food and energy, however, the inflation rate remained 2.8%, same as in April, i.e., it’s sticky.

Headline inflation....

Germany 2.0%, France 2.2%, Italy 1.2%, Spain 2.4%, Netherlands 3.3%, Ireland 1.1%.

Inflation in the UK for the month was unchanged at 2.2%.  The core rate was 3.6% vs. 3.3% in July.

So, Thursday, the Bank of England held off on cutting rates, but signaled that it was still on the path to lower them.

If the inflation rate continues to slow and the economy evolves as policymakers expect, “we should be able to reduce rates gradually over time,” Andrew Bailey, the governor of the central bank, said in a statement on Thursday.

“But it’s vital that inflation stays low, so we need to be careful not to cut too fast or by too much,” he added, reiterating previous comments.

Last week, the European Central Bank cut rates for the second time in three months.

Turning to Asia...China’s National Bureau of Statistics released some key figures for August last Sunday, and they were all less than the prior month and less than expectations.  As in they kind of sucked.

Industrial production was up 4.5% year-over-year, retail sales just 2.1%, and fixed asset investment rose 3.4% year-to-date.  The unemployment rate ticked up to 5.3%.

Home prices also fell 5.7% in August, the steepest decline in nine years, despite government efforts to stem the property crisis by lowering interest rates, relaxing home-purchase restrictions and pledging to buy unsold homes.

Japan’s August exports were disappointing, up just 5.6% year-over-year when a gain of 10% was forecast.  Imports rose 2.3%.

On the inflation front, the August rate was 3% vs. 2.8% prior, but ex-food and energy, it was 2% vs. 1.9%.

Street Bytes

--After the obligatory down move following a Fed announcement, stocks surged Thursday and the Dow Jones and S&P 500 hit new records, the Dow finishing the week up 1.6% to 42063, the S&P 1.4%, and Nasdaq 1.5%. [The S&P’s new record close is 5713, but it fell a little today.]

Next week we have the Fed’s preferred inflation barometer, the PCE (personal consumption expenditures index), and if it’s tame, that will only reinforce the Fed’s new mission statement.

--U.S. Treasury Yields

6-mo. 4.46%  2-yr. 3.57%  10-yr. 3.72%  30-yr. 4.07%

Having already discounted a move by the Fed, even a larger one than many expected, longer-dated Treasuries sold off a little from earlier lows.

The 10-year was at 3.68% just prior to the Fed announcement at 2 p.m. ET on Wednesday, and 3.65% a minute after, but you see above where it finished the week.

--Oil finished above the $70 level this week (West Texas Intermediate) as the Fed’s rate cut gave rise to the belief it would stimulate consumption in the U.S. and other major economies, while the attacks by Israel on Hezbollah added to concerns of warfare in the region.

--The Biden administration is granting a request by Japan’s Nippon Steel to resubmit its filing with the Committee on Foreign Investment in the United States for approval to purchase U.S. Steel.

The decision gives the two steel makers an additional three months to convince the federal government that the transaction does not pose a threat to national security, as argued by both Democrats and Republicans.  It also pushes the decision on a transaction until after the presidential election.

A White House spokeswoman said that President Biden and Vice President Harris continue to believe that U.S. Steel should remain American owned and operated.

But as a Wall Street Journal story pointed out, local officials in the Pittsburgh area, and workers, recognize that U.S. Steel desperately needs Nippon’s investment, and these voices are being heard.

--FedEx Corp. shares fell 15% Friday after the company cut the top end of its full-year profit outlook and reported quarterly earnings below expectations on softer demand for package deliveries.

In what CEO Raj Subramaniam called “a challenging quarter,” the Memphis-based company said it was hurt by lower demand for priority services as customers traded down to cheaper shipping options.

For the quarter ended Aug. 31, FedEx reported adjusted earnings per share of $3.60, well below analyst expectations for $4.77 (yikes) and the $4.37 it reported a year ago.  Revenue came to $21.6 billion, slightly below consensus.

Adjusted earnings for the current fiscal year are now projected to be $20 to $21 a share, the company said after the market close Thursday, below its prior forecast for as much as $22 a share.

--It’s been a week since workers at the Boeing plants manufacturing the 737, 767 and 777 jets walked off the job and the company said it would freeze hiring and delay pay increases for its salaried workforce as it deals with the financial fallout.  Boeing is also cutting back orders from suppliers for the impacted jets.    And CEO Kelly Ortberg, in an email to employees on Wednesday, said, “We are initiating temporary furloughs over the coming days that will impact a large number of U.S.-based executives, managers, and employees.”

A strike could cost the company some $500 million a week, according to an analyst estimate.  BA was burning through about $1 billion a month before the strike, and credit-ratings firms warned they may downgrade the company.

“The strike jeopardizes our recovery in a significant way, and we must take necessary actions to preserve cash and safeguard our shared future,” Boeing finance chief Brian West said in a company memo.

The good news is that Boeing and the International Association of Machinists and Aerospace Workers are back at the negotiating table, joined by the Federal Mediation and Conciliation Service, a group that helped resolve the 2008 strike which lasted eight weeks.

--TSA checkpoint numbers vs. 2023

9/19...102 percent of 2023 levels
9/18...100
9/17...103
9/16...103
9/15...104
9/14...103
9/13...102
9/12...101

--BlackRock and Microsoft are teaming up on one of the largest efforts to date to bankroll the build-out of data warehouses and energy infrastructure behind the boom in artificial intelligence.  The companies, along with the United Arab Emirates’ MGX Investment vehicle, will seek $30 billion of private equity capital over time for the strategy, which will then leverage the money to as much as $100 billion in potential investments, the companies announced Tuesday.

“The need to build out data centers globally is multi-trillions of dollars to finance,” BlackRock Chief Executive Officer Larry Fink said in an interview, adding that the Global AI Infrastructure Investment Partnership has been months in the making.  “This is just a great example of the capital markets building out infrastructure and building out the opportunities and new technologies.”

The bulk of the infrastructure investments will be mostly in the U.S., the companies said.

Separately, Microsoft Corp. raised its quarterly dividend 10% and unveiled a new $60 billion stock-buyback program, matching the size of a repurchase plan three weeks ago.

Shareholders of record as of Nov. 21 will receive a quarterly dividend of 83 cents a share, compared with the current 75 cents.

And then on Friday, the Wall Street Journal reported: “A deal between Constellation Energy and Microsoft will restart Pennsylvania’s Three Mile Island, the site of the country’s worst nuclear accident, to help power the tech giant’s growing artificial intelligence ambitions.”

Three Mile Island suffered a partial meltdown in 1979.  It will apparently take until 2028 to restart operations.

Shares in Constellation Energy soared 20% on the news.

--Intel said on Monday that it had signed new contracts and made further belt-tightening plans as it tries to cope with a deep slump in its business.

The company, which had embarked on a plan to expand its production capacity in the United States and abroad, said that Amazon would use its nascent chip production service, or foundry, to build at least two chips for its Amazon Web Services unit. It also said that it had secured an investment of up to $3 billion from the Biden administration to expand its manufacturing of advanced semiconductors for the U.S. military.

In a separate announcement, Intel said it would pause construction of new plants in Germany and Poland by about two years to wait for improved chip demand.  But the company reaffirmed plans for investments in the United States, including a closely watched expansion in Ohio, its first major new production site in four decades.

Intel has faced calls from some investors to spin off its manufacturing business. While stopping short of that, Pat Gelsinger, Intel’s chief executive, said the company planned to establish the foundry business as an independent subsidiary inside of Intel.

The shares jumped on both the government award and the Amazon news.  And they jumped further late today on a Wall Street Journal story that the company has been approached by Qualcomm.

--Amazon.com CEO Andy Jassy is moving to streamline the world’s largest online retailer and cloud-computing company, cutting management layers and ordering employees to return to the office five days a week beginning in January.

Amazon veterans have been whispering for years that it was becoming harder to get things done at the company, with stories of endless deliberation, unnecessary meetings and layers of approval becoming commonplace at a company that fashioned itself as a collection of teams charged with operating like startups.

Jassy called out some of those phenomena in his note, citing “pre-meetings for the pre-meetings for the decision meetings, a longer line of managers feeling like they need to review a topic before it moves forward, owners of initiatives feeling less like they should make recommendations because the decision will be made elsewhere.”

--General Mills posted a smaller-than-expected drop in quarterly sales on Wednesday aided by higher prices for certain snacks, helping combat a consumer demand slowdown.

It reaffirmed its fiscal year 2025 forecast, citing an uncertain economic backdrop for consumers across its core markets.

However, the Cheerios maker expects volume trends to gradually improve in fiscal 2025, although full-year category dollar growth is expected to be below the company’s long-term growth projections.

The company’s quarterly sales fell 1% to $4.85 billion from a year ago, with the Street at a decline of 2.1% and revenue of $4.80bn.  Adjusted earnings of $1.07 beat the Street by a penny.  A year ago, earnings were $1.09.

--Nike shares surged 6% after the company announced CEO John Donahoe was retiring, to be replaced by former Nike executive Elliott Hill.

Donahoe will be stepping down Oct. 13 and will remain an advisor to the company through Jan. 31.

“Given our needs for the future, the past performance of the business, and after conducting a thoughtful succession process, the Board concluded it was clear Elliott’s global expertise, leadership style, and deep understanding of our industry and partners, paired with his passion for sport, our brands, products, consumers, athletes, and employees, make him the right person to lead Nike’s next stage of growth,” said Mark Parker, executive chairman of Nike.

--Norway is the first country in the world with more electric vehicles than gas-powered cars on the road, according to vehicle registration data the Norwegian road federation released Tuesday.

Of the 2.8 million passenger cars registered in the country, 26.3 percent are fully electric, just edging out the share of gas vehicles.  Diesel remains the most common vehicle type, making up more than a third of Norwegian vehicle registrations.  EVs are expected to outnumber diesel cars by 2026.

Norway leads the world in EV adoption, thanks to government incentives that include exempting electric cars and trucks from sales and emissions taxes, lowering tolls and parking fees for these vehicles, and allowing EV drivers to use bus lanes.  It helps that Norway is also one of the world’s wealthiest countries.

--Instagram is making teen accounts private by default as it tries to make the platform safer for children.  Beginning Tuesday in the U.S., U.K., Canada and Australia, anyone under 18 who signs up for Instagram will be placed into restrictive teen accounts, and those with existing accounts will be migrated over the next 60 days.

Parent company Meta acknowledges that teenagers may lie about their age and says it will require them to verify their ages in more instances, like if they try to create a new account with an adult birthday.

“Sensitive content,” such as videos of people fighting or those promoting cosmetic procedures, will be limited, Meta said.  Private messages are restricted so teens can only receive them from people they follow or are already connected to.

The announcement comes as the company faces lawsuits from dozens of U.S. states that accuse it of harming young people and contributing to the youth mental health crisis by deliberately designing features on Instagram and Facebook that addict children to its platform.

--Shares in Trump Media & Technology Group hit new lows Friday, the second day that Donald Trump and other insiders could sell shares in the parent company of Truth Social as the lockup period after its March merger with a blank-check company expires.  Last week, Trump said he won’t sell, but others clearly took the opportunity to do so.

--Tupperware Brands filed for bankruptcy this week.  The home-goods brand, which has for much of a century defined food storage, is planning to enter court protection after it breached the terms of its debt and enlisted legal and financial advisers.

Tupperware was founded in 1946 by Earl Tupper, who invented the flexible airtight seal.  The brand exploded into American homes largely by way of sales parties hosted by suburban women.

--In yet another sign of a slowing Chinese economy, ticket sales at the box office from June to August totaled only $1.5 billion, less than half of last year’s record $2.89 billion, according to the government-run China Film Data Information Network.

Foreign Affairs, Part Deux

North Korea: The North launched a series of short-range ballistic missiles into the sea off its east coast Wednesday morning, local time, South Korea’s Yonhap news agency reported. The missiles flew for about 250 miles before splashing down into the water, Seoul’s Joint Chiefs of Staff said afterward.

This was Pyongyang’s first such launch in more than two months, which it later described as a test of a new 600-mm multiple launch rocket system, and the launches came just a few days after North Korea offered a rare view into a secretive facility built to enrich uranium for nuclear weapons.

Army Lt. Gen. Xavier Brunson, the nominee to lead U.S. Forces Korea, told lawmakers on Capitol Hill on Tuesday: “North Korea’s rapid advancement of its nuclear and missile capabilities, combined with its stated ambition to exponentially expand its nuclear arsenal, is the single greatest challenge” facing U.S. and allied forces in the region.

Iran: Tehran launched a satellite into space Saturday with a rocket built by the Revolutionary Guard, state-run media reported, the latest for a program the West fears will help Iran advance its ballistic missile program.

Tehran described the launch as a success, which would be the second such launch to put a satellite into orbit with the rocket. 

Footage later released by Iranian media showed the rocket blast off from a mobile launcher.

Meanwhile, Iran continues to enrich uranium to nearly weapons-grade levels.

The U.S. State Department and the American military did not immediately respond to requests for comment over the launch, but the U.S. had previously said Iran’s satellite launches defy a UN Security Council resolution and called on Tehran to undertake no activity involving ballistic missiles capable of delivering nuclear weapons.

It’s unclear what Iran’s new president, the reformist Masoud Pezeshkian, wants for the satellite program.

The U.S. intelligence community’s worldwide threat assessment this year said Iran’s development of satellite launch vehicles “would shorten the timeline” for Iran to develop an intercontinental ballistic missile because it uses similar technology.

Random Musings

--Presidential approval ratings....

Gallup: New numbers...39% approve of President Biden’s job performance, 58% disapprove; 31% of independents approve (Sept. 3-15).  The prior split was 43-53, 37.

Rasmussen: 44% approve, 54% disapprove (Sept. 20)

--According to a USA TODAY/Suffolk University poll taken after the debate, Kamala Harris leads Donald Trump in Pennsylvania, 49%-46%, in a statewide survey of 500 likely voters with a margin of error of 4.4 points, ergo, still tied.

Harris leads among female voters in the state, 56%-39%, while Trump tops male voters 53%-41%.  Harris edged Trump among independent voters 43%-38%.

--A Quinnipiac University poll of likely voters in three battleground states had Kamala Harris leading Donald Trump.

Pennsylvania: 51%-45% Harris; Michigan: 50%-45% Harris; Wisconsin: 48%-47%.

On the issues in these three, Quinnipiac found that Trump leads Harris by 2-4 points on the economy, and by one to 7 points on immigration. 

Harris leads Trump by 11 to 19 points on abortion.

In the Pennsylvania Senate race, incumbent Democratic Sen. Bob Casey leads Republican challenger David McCormick, 52%-43%, essentially unchanged from August.

In the Michigan Senate race, Democratic Congresswoman Elissa Slotkin has a 51%-46% lead over former Republican Congressman Mike Rogers. [Always liked him.]

And in Wisconsin, incumbent Democratic Senator Tammy Baldwin has a 51%-47% lead over Republican challenger Eric Hovde.

[All the above according to the Quinnipiac survey.]

--A new Des Moines Register/Mediacom Iowa poll shows that Trump leads Harris 47%-43% among likely voters – a far slimmer margin than the 18-point lead Trump enjoyed over Joe Biden in late spring.

--A Yahoo News/YouGov national poll conducted after the debate gave Harris a 50%-45% lead over Trump among registered voters in a head-to-head matchup.  She leads 48%-44% when third-party candidates are included.

And Harris is flipping independents as well.  Before the debate, now ten days ago, Harris trailed Trump by 9 points (35% to 44%) with that crucial bloc; she now leads by 10 (47% to 37%).

--But on the critical issue of the economy, a Pew Research Center survey has Trump leading Harris 55%-45% on the question, “Who makes good decisions about economic policy?”

However, when asked, “Who cares about the needs of ordinary people,” Harris leads Trump 51%-44%.

--The International Brotherhood of Teamsters declined Wednesday to endorse Kamala Harris or Donald Trump for president, saying neither candidate had sufficient support from the 1.3-million-member union.

“Unfortunately, neither major candidate was able to make serious commitments to our union to ensure the interests of working people are always put before Big Business,” Teamsters President Sean O’Brien said in a statement.  “We sought commitments from both Trump and Harris not to interfere in critical union campaigns or core Teamsters industries – and to honor our members’ right to strike – but were unable to secure those pledges.”

This was a big blow to Harris in battleground states such as Pennsylvania, Michigan and Wisconsin.

The Teamsters said Wednesday that internal polling of its members showed Trump with an advantage over Harris.

Other large unions such as the AFL-CIO and the United Auto Workers have chosen to back the vice president.

--Lt. Gov. Mark Robinson of North Carolina, the Republican nominee for governor, has been trailing his Democratic opponent, the state attorney general, Josh Stein, badly in polls I’ve seen, by like 9-11 points.

But Robinson, long known for incendiary remarks, is now facing calls to exit the race after a report by CNN revealed a number of posts traced to him that included a defense of slavery, as well as calling himself a “black NAZI!” on a pornographic messaging board.

In a video statement, Robinson accused Stein of leaking the story, though he offered no evidence.  “Let me reassure you,” he said, “the things that you will see in that story – those are not the words of Mark Robinson.”

But will Robinson’s travails impact the top of the ballot, Trump vs. Harris in this battleground state?  Most experts believe it will not.  Down ballot, maybe.

--Trump Assassination Attempt No. 2....

The Secret Service said Monday that Ryan Wesley Routh, the man suspected of trying to assassinate Donald Trump on Sunday at Trump International Golf Club in West Palm Beach, Fla., never had a line of sight on the former president.  He may have been hiding in wait in the bushes, starting overnight, for 12 hours, according to the agency, utilizing cellphone records.  Routh was charged with federal gun crimes.

But the Secret Service did not search the perimeter of the course on Sunday, an acknowledgement that has put the besieged agency under renewed scrutiny again after the Butler, Pa., attempt on Trump’s life.

Acting Secret Service director Ronald Rowe said in remarks to reporters Monday that “the president wasn’t even really supposed to go there,” and that it was an “off the record” plan.  Rowe then didn’t clarify if this meant agents didn’t have an attempt to sweep the golf course first.  But at the same time, it is public knowledge Trump likes to play on one of his courses on Sundays.

And so thankfully we did have a Secret Service agent, doing his advance work on the course, who saw Routh in the bushes, pointing a rifle, and the agent immediately opened fire, agents with Trump, roughly a hole behind, immediately whisking him out of danger.

“It was certainly an interesting day!” Trump said on Truth Social after.  Praising the work of the Secret Service and law enforcement, he added: “THE JOB DONE WAS ABSOLUTELY OUTSTANDING.  I AM VERY PROUD TO BE AN AMERICAN!”

But that was Sunday.  Monday, Trump changed his tone, as he is wont to do, and claimed without evidence that President Biden and Vice President Harris’ comments were the threat to democracy that inspired the latest assassination attempt, despite his own long history of inflammatory campaign rhetoric and advocacy for jailing or prosecuting his political enemies.

“Their rhetoric is causing me to be shot at, when I am the one who is going to save the country and they are the ones that are destroying the country – both from inside and out,” Trump said in comments to Fox News Digital. 

In a post on Truth Social on Monday: “The Rhetoric, Lies, as exemplified by the false statements made by Comrade Kamala Harris during the rigged and highly partisan ABC Debate, and all of the ridiculous lawsuits specifically designed to inflict damage on Joe’s, then Kamala’s, Political Opponent, ME, has taken politics in our Country to a whole new level of Hatred, Abuse, and Distrust.  Because of this Communist Left Rhetoric, the bullets are flying, and it will only get worse!”

This from the same guy who during the debate and in the days after amplified false rumors that Haitian immigrants in Ohio are abducting and eating pets.  The community of Springfield later evacuated schools and government buildings amid bomb threats, adding to the sense of an especially unstable and tense moment in America...before Sunday’s new development.

Editorial / Washington Post

“Another chilling security threat, another collective sigh of relief – and a stroke of good fortune: an alert Secret Service agent who spotted the barrel of a gun in the bushes and fired his own weapon at the threat while Donald Trump golfed in Florida on Sunday afternoon.  Still, Ryan Wesley Rough should never have been able to get between 300 and 500 yards from the former president, armed with an SKS-style rifle.

“Palm Beach County Sheriff Ric Bradshaw acknowledged that the area was not cordoned off because Mr. Trump is not receiving the level of protection he did when he was president.  ‘If he was, we would have had the entire golf course surrounded,’ Mr. Bradshaw said at a news conference.  ‘Because he’s not, security is limited to the areas that the Secret Service deems possible.’

“This needs to change.  Fifty days before a neck-and-neck election, after what are now attempts on his life, Mr. Trump ought to get presidential-level coverage.  Protecting Mr. Trump as he campaigns is as essential a part of ensuring political stability and continuity of government as one could imagine.

“Acting Secret Service director Ronald L. Rowe Jr. defended the agency’s handling of the situation as ‘textbook,’ noting that Mr. Routh never had Mr. Trump in his line of sight, nor did he get off a shot.  Mr. Rowe added that the agency had already significantly enhanced Mr. Trump’s security posture.  ‘If we need to ratchet up additionally, we will,’ he said.

“It takes little imagination to recognize that the Secret Service has been stretched thin and agents overwhelmed for a long time.  Serious questions remain following the July 13 assassination attempt in Butler, Pa., in which a 20-year-old sniper shot and wounded the former president and killed a rally attendee before the Secret Service returned fire and killed him.  Director Kimberly Cheatle resigned in July. When Congress acts on a bill to fund the government this month, it should provide additional resources to help the agency fulfill its zero-fail mission.

“Strong bipartisan support exists for doing so, even as it exists for investigating and correcting the Secret Service’s own shortcomings.  President Joe Biden said he has directed his administration ‘to continue to ensure that Secret Service has every resource, capability and protective measure necessary to ensure the former president’s continued safety.’  Sen. Thom Tillis (R-N.C.) announced legislation Monday to ensure that both major-party nominees receive the same level of Secret Service protection as a sitting president. ‘We are demanding in the House that he have every asset available,’ Speaker Mike Johnson (R-La.) said on Fox News....

“Vice President Kamala Harris and Mr. Biden unequivocally condemned political violence and said that they’re relieved Mr. Trump is okay. That – not indulging the temptation to use the news to one-up political opponents – is the only reasonable response.

“We don’t envy the Secret Service.  Its agents get little credit when, day in and day out, they successfully protect the nation’s leaders.  Any slip-up could be disastrous. Yet sequestering candidates and incumbent politicians from the public would prevent voters from evaluating those who act in their name.  Striking the right balance between security and access is not easy. But it is the job.  Congress should ensure the Secret Service has the resources to do it.”

Editorial / Wall Street Journal

“The failure of another assassination attempt against Donald Trump on Sunday, the second in two months, is a great relief but also another warning about our deranged politics....

“The Secret Service has raised the level of protection for Mr. Trump since the Butler debacle. But the debate was already raging on Sunday about whether the former President deserves the greater protection received by a current President. The simple answer is yes, and the same goes for Kamala Harris.

“The risk level is too high these days to take chances. This will probably require Mr. Trump to change some of his habits, such as golfing only on courses where a shooter can’t get access.  But the risks aren’t only from a lone gunman, if that is what Mr. Routh is.

“We already know that Mr. Trump has been targeted by Iran, and it’s easy to imagine a foreign power or a domestic political group plotting to kill him now, while he’s a candidate and his protection is less intense than if he wins the election.

“Especially after Butler and now West Palm Beach, the Secret Service cannot be seen as failing to protect the candidates. Any harm that comes to either nominee, but especially to Mr. Trump after two failed attempts, would lead to conspiracy theories that could lead to further violence.  The country, and President Biden, can’t afford to tempt fate again.”

--Last week I wrote of Elon Musk and the topic of misinformation when it came to the election process in the United States, and then after reports of an apparent second assassination attempt against Trump, Musk published and deleted a post wondering why no one was trying to assassinate President Biden and Vice President Kamala Harris.

Musk wrote on Sunday, “And no one is even trying to assassinate Biden/Kamala,” with a thinking-face emoji, according to screenshots of the post on X.  He later said the post was supposed to be a joke.

After his assassination post drew outrage on X, the billionaire deleted the post and wrote several more trying to walk it back.  “Well, one lesson I’ve learned is that just because I say something to a group and they laugh doesn’t mean it’s going to be all that hilarious as a post on X,” he wrote Monday.

He added: “Turns out that jokes are WAY less funny if people don’t know the context and the delivery is plain text.”

I’m tired of people hiding behind ‘you didn’t know the context of blah blah blah.’  It’s one reason I extensively quote people as I do, even while editing, to ensure I’m giving the proper context.

But Andrew Couts of WIRED had some interesting thoughts on Musk:

“Where things get dicier (for him) is his role as a major contractor for the U.S. Department of Defense and NASA.  According to Reuters, SpaceX signed a $1.8 billion contract in 2021 with the National Reconnaissance Office, which oversees U.S. spy satellites.  The U.S. Space Force also signed a $70 million contract late last year with SpaceX to build out military-grade low-earth-orbit satellite capabilities.  Starlink, SpaceX’s commercial satellite internet wing, is providing connectivity to the U.S. Navy.

“NASA, meanwhile, has increasingly outsourced its spaceflight projects to SpaceX, including billions of dollars for multiple trips to the moon and an $843 million contract to build the vehicle that will take the International Space Station out of commission.

“The U.S. government’s heavy reliance on companies controlled by Musk has repeatedly raised the hackles of national security experts. Concerns at the Pentagon came into stark relief last September after Musk denied Ukraine’s request to enable Starlink in Crimea, a disputed territory bordering Russia, so it could launch an attack on Russian troops.  (Starlink was not under a military contract when he denied the request.)  In response to previous WIRED reporting, Musk asserted that ‘Starlink was barred from turning on satellite beams in Crimea at the time, because doing so would violate U.S. sanctions against Russia!’ ....

“The CEO reportedly has security clearance given his companies’ work on classified U.S. government projects. While there are many rules around who gets security clearance, such as abstaining from cannabis use, the designation is awarded and maintained on a risk-vs-reward basis for the U.S. government.  Given that Musk is perhaps the world’s richest man and most famous chief executive, it may be tricky to pull his security clearance regardless of his flippant discussions of political assassinations.”

I have always separated Musk the genius from Musk the citizen, for lack of a better word.  I’m as big a fan as anyone when it comes to SpaceX and his dreams concerning Mars, for example.  But this other side of him is more than a bit troubling, and begs the question, ‘Can he be trusted to always act in America’s best interests?’ 

--Back to Springfield, Ohio, and the false claims made about the Haitian community, Ohio GOP Gov. Mike DeWine called claims like Trump’s and JD Vance’s “a piece of garbage that was simply not true” and defended the immigrants: “They came to Springfield to work.”

“I think these discussions about Haitians eating dogs and cats and other things needs to stop...it’s just not helpful,” said DeWine on ABC’s “This Week.”

Trump on Saturday vowed “mass deportations” in Springfield, the vast majority of whose immigrants are there legally.  JD Vance said on CNN on Sunday that he needed “to create stories” to make his points.  Vance defended his circulation of the pet-eating claims, saying that he was merely echoing reports he had heard from Ohio constituents, whom he didn’t identify.

“The evidence is the firsthand account of my constituents who are telling me that this happened,” Vance said.

“The American media totally ignored this stuff until Donald Trump and I started talking about cat meat,” Vance said. “If I have to create stories so that the American media actually pays attention to the suffering of the American people, then that’s what I’m going to do because you guys are completely letting Kamala Harris coast.”

Vance said he condemned the bomb threats against Springfield and expressed sympathy for Springfield’s mayor but denied that he had spread lies.

--Donald Trump on Sunday then felt compelled to declare his enmity for Taylor Swift days after the global pop star endorsed Kamala Harris: “I HATE TAYLOR SWIFT!”

An ABC News/Ipsos poll out on Sunday found 81% of respondents said Swift’s endorsement made no difference.  Just 6% of respondents said Swift’s endorsement made them more likely to vote for Harris, while 13% said it makes them less likely.

That same poll found that more Americans say Harris won the debate than Trump, by a 58% to 36% margin.

A YouGov poll released Saturday found that 8% of voters said the pop superstar’s nod is either “somewhat” or “much more likely” to convince them to cast their ballot for the Democrats.  But 20% are somewhat or much less likely to vote for the Democrat, according to the survey.

But these are stupid poll questions.  Yours truly has actually become a regular for the Rasmussen survey these days.  Because I’ll take the time to answer the questions honestly, and Rasmussen is careful not to take too much of my time, I kind of enjoy being part of the survey, getting a call every month or so.

And I know that it doesn’t matter what you or I think regarding Taylor Swift’s endorsement, but it’s the ones not being surveyed, young Swiftie fans!  I personally couldn’t care less about what she says regarding politics, or what any other entertainer, or sports figure for that matter, believes.

But as an analyst, I made my comment last week that no one should be surprised if in some states in November, her endorsement got a bunch of supporters to register and vote, and they’ll vote for Harris.  After I posted last week, Peggy Noonan expressed similar thoughts from her Wall Street Journal perch.

--The conservative Republican mayor of Aurora, Colo., Michael Coffman, conceded during a City Hall meeting last week that he had to reverse his own rhetoric as he watched Donald Trump continue to stoke fear in his community of 404,000.

“I mean, I agree with him on a lot of policies as it pertains to immigration. But I’m also the mayor of the City of Aurora, and my job is not only to make sure that the city is safe, but also to protect the image of the city. This narrative out there is exaggerated, and it’s our responsibility to correct it.”

Coffman helped create the tale that Aurora was overrun by the Venezuelan street gang, Tren de Aragua.  The fact is, there are some dilapidated apartments, migrants living in them, that Aurora officials now call squalor, amid “critical elements,” not widespread gang activity, and unable to find or afford better.  But the buildings are at the center of another national firestorm.

--Pope Francis, taking questions from reporters on his flight back to Rome following his grueling 11-day Southeast Asia and Oceania trip, was asked his advice to Catholic voters in the coming U.S. presidential election, and the Pope said they must choose the “lesser of two evils” because “both are against life” – Kamala Harris for her support for abortion rights, and Donald Trump for closing the door to immigrants.

“Sending migrants away, not allowing them to grow, not letting them have life is something wrong; it is cruelty,” Francis said.  “Sending a child away from the womb of the mother is murder because there is life. And we must speak clearly about these things.”

The Pope’s comments are very reflective of the divide among Catholic voters in the U.S.  He didn’t mention either candidate by name.

Francis has put caring for migrants and opposing abortion on equal footing, saying in a 2018 document that both were holy pursuits.

--Music mogul Sean “Diddy” Combs was arrested Monday in New York, where he faced a raft of serious charges, including sexual assault.  He was denied bail.

Diddy is a bad guy.  Like a real, real, bad guy. 

--Exceptionally heavy rainfall pounded Central Europe, causing deadly flooding in the region, including Austria, the Czech Republic, Poland and Romania, killing at least 17, and then impacting Slovakia and Hungary.

In Poland, Prime Minister Donald Tusk held an emergency meeting and later declared a disaster in many areas, with the flooding bursting dams and embankments.  Many Polish cities, including Warsaw, called for food donations for flood survivors.

--Shanghai was hit by its strongest typhoon, Bebinca, since at least 1949, flooding roads and knocking out power to some.  More than 414,000 were evacuated ahead of the storm.

Meanwhile, across southeast and central Asia, including Vietnam that I wrote of last week, and Myanmar, over 1,000 have died in flooding.

--Parts of southeastern North Carolina experienced “life-threatening flash flooding” Monday as the unnamed tropical system brought rain totals usually not seen in hundreds of years, weather officials said.

The towns of Carolina Beach, Boiling Springs Lakes and Southport received more than a foot of rain in the first 12 hours of Monday, Carolina Beach with 18 inches in that time, the type of deluge that on average happens once every 200 years, said the National Weather Service’s office in Wilmington, North Carolina.  The 18 inches was a “once every 1000 years!” the office exclaimed.  Winds gusted as high as 77 mph in some spots.

--Finally, congratulations to SpaceX and the Polaris Dawn mission for its safe completion last Sunday as the four astronauts splashed down off the coast of Florida, wrapping up a groundbreaking commercial mission, including the first spacewalk by a private citizen.

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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 $2647...another new high!
Oil $71.77

Bitcoin: $62,940 [4:00 PM ET, Friday...up about $9,000 in two weeks...]

Regular Gas: $3.22; Diesel: $3.59 [$3.87 - $4.58 yr. ago]

It is very important the price of diesel has fallen $1 over the past year, as this is all about the cost of groceries and items carried in your local drug store, for starters.  Diesel peaked at $5.81 in June 2022, as inflation was peaking overall.  And that’s why I cover it in this space, sports fans.

Returns for the week 9/16-9/20

Dow Jones  +1.6%  [42063]
S&P 500  +1.4% [5702]
S&P MidCap  +2.3%
Russell 2000  +2.1%
Nasdaq  +1.5%  [17948]

Returns for the period 1/1/24-9/20/24

Dow Jones  +11.6%
S&P 500  +19.5%
S&P MidCap  +11.6%
Russell 2000  +9.9%
Nasdaq  +19.6%

Bulls 49.2
Bears 22.9

Hang in there. 

Brian Trumbore

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