Week in Review

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Week in Review

08/17/2024

For the week 8/12-8/16

[Posted 4:30 PM ET, Friday]

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Edition 1,322

I was telling a friend this week that I was receiving a lot of disinformation across the transom like I did for the 2016 campaign, which was largely absent in 2020, and it’s discouraging.  And then I was reading a piece in Defense One by Patrick Tucker on how social media firms are lowering their defenses, after agreeing in 2017 to fight back and develop tools to monitor the flow better, which was why in 2020 it seemed to improve some.

Tucker:

“On Wednesday, Facebook’s parent company Meta will cease to support CrowdTangle, a data tool that allows researchers, journalists, and other observers to uncover disinformation and misinformation trends on the social network. Experts from a variety of organizations warn that the move, coupled with other decisions among social media companies to roll back data monitoring and trust and safety teams, will make it much harder to fight lies spread by hostile powers.

“That will help China, Russia, and other autocratic countries that seek to sow political division in the United States, said Nathan Doctor, senior digital methods manager at the Institute for Strategic Dialogue.”

If you can’t identify, you can’t reactively deal with it.

Meta’s decision mirrors that of Elon Musk, who after he took over Twitter – now X – in 2022, disbanded the team that watched for foreign disinformation. But Meta is far bigger than X...3 billion monthly active users on Facebook and 2 billion on Instagram, while X has about 600 million. Disabling CrowdTangle is a big blow.

Facebook hasn’t given a good reason why it made the decision it did, and as Brandi Geurkink, executive director of the Coalition for Independent Technology Research, said this week:

“I think we’re almost at the point where it’s worse than what was in 2016 right now.”

Speaking of disinformation, Donald Trump was full of it this week.  I watched his entire rally in Asheville, N.C., and his press conference yesterday in Bedminster, N.J., and I have to respond to some nuggets of his.

“Mortgage rates are at 10%...a lot more than 10%.”

They are currently 6.49%, according to Freddie Mac.

“Three hundred fifty thousand were added to the unemployment rolls.”

Ahh, where the hell are you getting this, Mr. President?

“I’m a big fan of electricity.”

On this we can agree.  Can’t do my column without the Big E, as we say in the ‘burbs.  You need electricity to chill beer, too.  And we wouldn’t have been able to watch the Olympics.

“Israel would have never happened,” meaning Oct. 7 and the aftermath, if Trump had been president.

Oct. 7 happened due to Benjamin Netanyahu’s careless, reckless failure to secure the border.

“Gasoline is $5.00 today...much higher in some places.”

This one really ticks me off as he uses the line in every rally and interview.  These are the prices for regular gas at the pump, on Wednesday, in the following battleground states. [Source: AAA]

Arizona $3.46
Georgia $3.24
Michigan $3.54
Nevada $3.95
North Carolina $3.23
Pennsylvania $3.58
Wisconsin $3.39

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Kamala Harris hasn’t done a press conference or a major sit-down interview since she announced she was filling in for her boss, and she won’t do one, at the earliest, until after next week’s Democratic National Convention in Chicago.

But today she finally laid out an economic plan, a reboot of President Biden’s policies, focusing on how she plans to fight big corporations and bring down costs on necessities like food, housing and raising children.

For her first 100 days, should she be elected, Harris will combat price gouging at the grocery store, which is a meaningless statement, jump-start the construction of more affordable housing, restore and expand the tax credit for parents and lower the cost of prescription drugs.  And she will pay for her proposals largely by “asking the wealthiest Americans and largest corporations to pay their fair share,” i.e., Biden’s latest budget proposal. 

Harris has been attacking Trump’s proposal to impose new tariffs of up to 20 percent on all imported goods, saying it would amount to a tax increase on working families.

But most of what Harris proposes, which is, it must be said, popular with voters, requires congressional legislation, and for any success, Democrats need to win clear majorities in the House and Senate in November.

More importantly for Harris is her convention speech next week.  Her real coming out party.

Russia-Ukraine

I worry about Ukraine’s major incursion in Kursk.  As of today, Ukrainian forces have made good progress, as I get into in detail below, and they’ve captured more than a few villages and a key energy transport hub, but reportedly the advance is stalling around larger towns and the Russians, initially sluggish to respond, are fortifying positions, including digging trenches in front of the region’s nuclear power station and around Kursk city, the regional capital.

What is unsettling is that Russia is making progress in the Kharkiv and Donbas regions, where they are inflicting severe damage. Ukraine is outnumbered 5-to-1, and as noted below, one Ukrainian commander on the front lines remarked he could use the 1,000 troops that have been sent into Kursk.

On Wednesday, Ukraine’s deputy prime minister said the country intended to establish a “security zone” in Russia to shield against assaults on Ukrainian territory.

This coming week is going to be critical.

--Russia’s defense ministry said that Ukrainian troops had advanced up to 30km (about 20 miles) inside Kursk.  [The Economist today said the advance is now up to 40km.]   The governor of the region ordered authorities to speed up the evacuation of tens of thousands of civilians.

On Monday, Russia said it had evacuated more than 133,000 people from border areas as Ukraine pressed on with its incursion, which Kyiv claimed has now taken over 1,000sq km of territory. [The U.S. based Institute for the Study of War think tank did not believe all the area was under Ukrainian control.]

Russian President Vladimir Putin called the offensive a “major provocation” at a meeting with officials and hinted at consequences for the failure to anticipate it.

“An assessment of the ongoing events must certainly be made, and it will be,” Putin told his security cabinet and the governors of three Russian border regions.  “But the main thing now is solving the tasks at hand...to push out and beat back the enemy from our territory and ensure the state border is well protected.”

He suggested the conflict could spread to other Russian regions.

Putin claimed Kyiv was trying to stop Russia’s advance along the frontline and improve its negotiating position in future peace talks.  Vlad lashed out at the West, saying it “is fighting us with the hands of the Ukrainians.  The enemy will certainly get the response he deserves, and all our goals, without doubt, will be accomplished.”

Putin also claimed his forces had stepped up their advance elsewhere along the front line.  He said Moscow would not participate in any potential peace talks with Kyiv.

In his first acknowledgement of the incursion, Ukrainian President Volodymyr Zelensky late Saturday described the operation as “our actions to push the war onto the aggressor’s territory.”

Ukraine, he said, “is guaranteeing exactly the kind of pressure that is needed: pressure on the aggressor.” 

Monday, Zelensky called it a “defensive action” and said he had asked the security services and interior ministry to prepare a “humanitarian plan” for the area held by Ukrainian forces.

Ukraine’s top commander, Oleksandr Syrskyi, said Ukraine continued to “conduct an offensive operation in the Kursk region” seven days after it began.

Zelensky said Russia had brought war to others and now it was coming back to Russia.

The acting governor of Kursk region, Alexei Smirnov, said during the meeting with Putin that 28 villages in the area had fallen to Ukrainian forces, that 12 civilians had been killed and that “the situation remains difficult.”  But that was a few days ago.  I have not seen any update on casualties suffered on both sides.

One risk for Ukraine is that Moscow will now redouble its own attacks on Ukraine’s civilian population and infrastructure.

And as for the frontline in the east, one Ukrainian battalion commander fighting near the logistical hub of Pokrovsk, told the BBC: “Maybe I’m in the same position now as the private who doesn’t understand why he has to hold a trench.  But 1,000 men are very badly needed here.”

Ukraine said on Tuesday it had no interest in occupying territory in the Kursk region and that its major incursion would complicate Russian military logistics and its ability to send more units to fight in Ukraine’s east.

“Unlike Russia, Ukraine does not need other people’s property.  Ukraine is not interested in taking the property of the Kursk region, but we want to protect the lives of our people,” Heorhii Tykhyi, a spokesman for the Ukrainian foreign ministry said.

President Biden said Tuesday that Ukraine’s incursion into Russia had “created a real dilemma for Putin,” adding that U.S. officials were in constant contact with Ukrainians about the move.

The White House said Ukraine did not provide advance notice of its incursion, and that the objectives of President Zelensky remain to be seen, though there seems to be a growing consensus that the goal appears to be to force Russia to pull troops out of Ukraine to defend Russian territory.

U.S. officials then said late Tuesday that it appeared Russia was withdrawing some of its military forces from Ukraine to respond to the offensive into Russian territory.

Ukraine kept pounding Kursk with missiles and drones on Wednesday, as Kyiv said it had made further territorial gains.  The whole region was under air raid alerts on and off most of the night, its acting governor Smirnov said early Wednesday.

Tuesday, Kyiv had said it had taken control of 74 settlements in Kursk.  A Russian military blogger close to the defense ministry who goes by the name “Rybar” said on Telegram that Ukrainian forces were attacking in several areas at once, while Russian troops were “pinning down” Kyiv soldiers, striking their armor, while reinforcements were arriving.

It wasn’t clear which side was in control of the key town of Sudzha, through which Russia delivers gas from western Siberia through Ukraine and on to Slovakia and other European Union countries.  Gazprom said Tuesday it was still pumping gas to Ukraine through Sudzha.

On Wednesday, the governor of Belgorod, south of Kursk, declared a state of emergency, citing continued attacks by Ukrainian forces.

Ukraine, meanwhile, is sending more tanks and armored vehicles to reinforce its troops in Russia, and said its forces had advanced further into Kursk, President Zelensky noted on Telegram, adding Ukrainian forces had taken another 100 Russian prisoners Wednesday alone.  Russia’s defense ministry said 117 Ukrainian drones had been shot down within its territory overnight.  It said missiles had also been downed and video supposedly showed Sukhoi Su-34 bombers striking Ukrainian positions in the Kursk region.

Russian state television said Russian forces were turning the tide on the Ukrainian forces, showing footage of what it claimed were successful attacks on Ukrainian positions.

Ukraine’s top commander said Sudzha was fully under Ukrainian control.  Natural gas was still pumping on Wednesday.  [President Zelensky claimed Sudzha was in Ukrainian control as well on Thursday.]

Ukraine then mounted its largest drone attack on Russian airfields since the invasion, targeting four key sites deep inside Russian territory with dozens of drones overnight.

A Ukrainian intelligence official said Kyiv attacked an air base in Savasleyka, more than 400 miles from the Ukrainian border.  The base houses MIG-31 warplanes that launch Kinzhal missiles, among Russia’s most advanced weapons.  About 10 explosions were reported at the base, according to Russian independent media, quoting locals.

Three other airfields with warplanes that fire the heavy glide bombs were also targeted.

--President Zelensky urged allies to allow Ukraine to strike deep into Russian territory as a missile attack killed two near Kyiv on Sunday.

--Russia and Ukraine accused each other of starting a fire at the dormant Russian-occupied Zaporizhzhia nuclear power plant in Ukraine on Sunday, but both sides reported no sign of elevated radiation.

The International Atomic Energy Agency nuclear watchdog said its staff had seen thick, dark smoke coming from the northern part of the vast six-reactor plant in southern Ukraine, currently in “cold shutdown,” after multiple blasts.

Interfax news agency quoted Alexei Likhachev, head of the Russian state nuclear corporation Rosatom, as saying the fire had burned for about three hours and caused “very serious damage” to the cooling towers.  He claimed it was caused by two Ukrainian drone strikes, without providing evidence.

Russia captured the plant from Ukraine shortly after launching its full-scale invasion in 2022.

--Russia launched 38 attack drones and two Iskander-M ballistic missiles at Ukraine overnight, Tuesday, Ukraine’s air force said.

Thirty of the drones were destroyed over several Ukrainian regions, the air force said on Telegram.  It was not clear what happened to the air weapons that were not destroyed.

Russia’s air defense units destroyed 14 drones that Ukraine launched overnight targeting Kursk, Voronezh and Belgorod region, Russia’s news agencies reported on Tuesday as well.

Twelve of the drones were destroyed over the border region of Kursk, and one each over Voronezh and Belgorod, RIA reported, citing Russia’s defense ministry.

--Russia said on Thursday that its forces had taken control of a village in eastern Ukraine, Ivanivka, that is just 16 km (10 miles) from the important city of Pokrovsk, which I’ve noted before is a major transit point with roads supplying Ukrainian forces in the area.

Russia’s defense ministry said its forces had clocked up a host of wins along the front, from Kharkhiv region to Luhansk and Donetsk.

Ukraine said there was no sign Russian military pressure was receding along the eastern front inside its borders on Thursday, more than a week after its incursion into Russia, and reported the heaviest fighting in weeks near Pokrovsk.

Separately, Russian guided bomb attacks on Thursday killed at least two people in the Kharkiv region, at least seven injured.  Administrative buildings, a kindergarten, and over 20 private homes were damaged.

--Reuters reported: “Dozens of Russian military personnel are being trained in Iran to use the Fath-360 close-range ballistic missile system, two European intelligence sources told Reuters, adding that they expected the imminent delivery of hundreds of the satellite-guided weapons to Russia for its war in Ukraine.”

The Fath-360 defense system, which launches missiles with a maximum range of 75 miles, could be used for targets beyond the front line.  A spokesman for the U.S. National Security Council said the U.S. and its NATO allies and G7 partners “are prepared to deliver a swift and severe response if Iran were to move forward with such transfers... It would represent a dramatic escalation in Iran’s support for Russia’s war of aggression against Ukraine.”

--A Russian court sentenced a dual Russian-American citizen, Ksenia Karelina, to 12 years in prison on Thursday after finding her guilty of treason for donating $51 to a charity supporting Ukraine.  The Los Angeles resident, a spa worker, pleaded guilty at her closed trial in the Urals city of Yekaterinburg, where her case was heard by the same court and judge that convicted Wall Street Journal reporter Evan Gershkovich of espionage in July, prior to the prisoner swap.

--The Wall Street Journal in a lengthy essay Friday showed that Ukrainian forces were indeed behind the Nord Stream pipeline bombing in September 2022.  According to several sources, Ukraine’s top military officer at the time, Valeriy Zaluzhniy, forged ahead with the project despite President Zelensky’s request that the operation be called off.

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Israel-Hamas-Hezbollah-Iran

--The White House said it was “deeply concerned” about an Israeli airstrike on a Gaza City school compound on Saturday that civil defense officials say killed around 100 people, adding to condemnation of the attack from several Arab states, Turkey, Britain and the European Union’s foreign policy chief.

The school compound in Gaza City housed displaced Palestinian families.  Israel said around 20 militants had been operating at the compound.  Video from the site was gruesome...body parts scattered among rubble.

Saturday’s airstrike came a day after a State Department spokesperson said the U.S. will provide Israel $3.5 billion to spend on U.S. weapons and military equipment after Congress appropriated the funds in April.

“We know Hamas has been using schools as locations to gather and operate out of, but we have also said repeatedly and consistently that Israel must take measures to minimize civilian harm,” the White House added.  The statement also said “far too many civilians continue to be killed and wounded” in the Gaza war and reiterated its calls for a ceasefire.

EU foreign policy chief Josep Borrell said he was horrified by the images from the school, while British foreign minister David Lammy said he was “appalled” by the strike.

“The compound, and the mosque that was struck within it, served as an active Hamas and Islamic Jihad military facility,” Lieutenant Colonel Nadav Shoshani of the Israel Defense Forces (IDF) said on X. “According to an initial review, the numbers published by the Hamas-run Government Information Office in Gaza, do not align with the information held by the IDF, the precise munitions used, and the accuracy of the strike,” Shoshani said.

--Asked Tuesday if he expected Iran to skip a retaliatory strike on Israel if a Gaza ceasefire deal was reached, President Biden said, “That’s my expectation.”

Iranian officials have been hinting that only a ceasefire deal stemming from talks this week would hold Iran back from direct retaliation against Israel.

The talks were then held Thursday, but Hamas said it would not take part because it did not think Prime Minister Benjamin Netanyahu’s government has been negotiating in good faith, the group said Wednesday.

“Netanyahu is not interested in reaching an agreement that ends the aggression completely,” said Ahmad Abdul Hadi, who accused Netanyahu of wanting to prolong and even expand the war.

Netanyahu rejected accusations that he is stonewalling and has consistently blamed the deadlock on Hamas.

Thursday, Hezbollah leader Hassan Nasrallah said his group’s response to Israel’s assassination of the movement’s military strategist Fuad Shukr and Hamas leader Ismail Haniyeh would be incremental and gradual rather than directly confrontational.  Hezbollah lawmaker Ali Fayyad said the response “will inevitably come,” adding that the delay “is a calculated part of the resistance’s performance and its management of the battle.”

Israeli Defense Minister Yoav Gallant has warned that forceful Hezbollah retaliation could “drag Lebanon into paying an extremely heavy price.”

Ceasefire talks continued Friday.

--Israeli forces pressed on with their operations near the southern Gaza city of Khan Younis on Monday amid an international push for a deal to halt the fighting in Gaza.  Palestinian medics said Israeli strikes on several areas of Khan Younis on Monday killed at least 16 people.  Hamas has reacted skeptically to the latest round of Egyptian and Qatar-brokered talks, saying it has seen no movement from the Israeli side.

Meanwhile, more families and displaced persons streamed out of areas threatened by new evacuation orders telling people to clear the area.

--The IDF has touted their forces have killed more than 17,000 Hamas operatives in the Gaza Stripp since the war began, with U.S. officials saying Israel has achieved “the vast majority” of its goals against the terrorists.

IDF Spokesman Rear Adm. Daniel Hagari said about 56% of Hamas’ estimated 30,000 forces have been wiped out since Israel waged war following the Oct. 7 massacre.

White House National Security Council spokesperson John Kirby says the update proves Israel has decimated the terror group’s military capabilities and leadership at all levels.

--Preparations for a larger scale confrontation grew, with Washington ordering a guided missile submarine to the Middle East and the Abraham Lincoln strike group accelerating its deployment to the region.  Israeli Defense Minister Gallant told Defense Secretary Lloyd Austin that Iran was making preparations for a large-scale attack on Israel.

White House national security spokesperson John Kirby said on Monday that the U.S. had increased its regional force posture and shared Israel’s concerns about a possible Iranian-backed attack.  “We share the same concerns and expectations that our Israeli counterparts have with respect to potential timing her.  Could be this week,” Kirby told reporters.  “We have to be prepared for what could be a significant set of attacks,” he said.

--Prime Minister Netanyahu slammed Defense Minister Gallant on Monday, exposing deep rifts within the government at a tense time.

Netanyahu criticized Gallant after Israeli news media reported that Gallant had disparaged the prime minister’s goal of “total victory” over Hamas by telling lawmakers in a private security briefing on Monday that it was “nonsense.”

“When Gallant adopts the anti-Israel narrative, he harms the chances of reaching a hostage-release deal,” the prime minister’s office said in a statement.  “Victory over Hamas and the release of hostages,” the statement said, is the “clear directive of Prime Minister Netanyahu and the cabinet, and it obligates everyone – including Gallant.”

--A Hamas guard who killed an Israeli hostage on Monday acted ‘in revenge’ against instructions after he got news that his two children had been killed in an Israeli strike, the spokesperson for the group’s armed al-Qassam Brigades, Abu Ubaida, said on Thursday.

“The (Hamas) soldier assigned as guard acted in a retaliatory manner against instructions after he received information that his two children were martyred in one of the massacres conducted by the enemy,” the spokesperson said on Telegram.  “The incident doesn’t represent our ethics and the instructions of our religion in dealing with captives.  We will reinforce the instructions.”

Seriously, the guy really said this.

--Amid calls to reconstruct the Gaza Strip if ceasefire talks prove successful, the task will take years and first you have to clear the debris.  The cost for that task alone is now up to $700 million.

--Today, Israeli leaders roundly condemned a deadly settler rampage in the occupied West Bank, a rare denunciation of the settler violence growing more common since the start of the Israel-Hamas war.

The settler riot was in the village of Jit, near the city of Nablus in the northern West Bank, killing one Palestinian and severely injuring others late Thursday. 

At least a hundred masked settlers entered the village, shot live ammunition at Palestinians, burned homes and cars and damaged water tankers.  Video showed flames engulfing the small village, which residents said was left to defend itself without military help for two hours.

Prime Minister Netanyahu said he took the riots “seriously” and that Israelis who carried out criminal acts would be prosecuted. He issued what appeared to be a call for settlers to stand down.

“Those who fight terrorism are the IDF and the security forces, and no one else,” he said.

President Isaac Herzog also condemned the attack, as did Defense Minister Gallant, who said the settlers had “attacked innocent people.”  He added they did not “represent the values” of settler communities.

Unfortunately, this scum has been growing exponentially in Israel.  These are the same folks hiding behind their “Orthodoxy” in order to avoid military service.  And they are led by two members of Netanyahu’s coalition, far-right ministers Bezalel Smotrich and Itamar Ben-Gvir, who are not good people.

--Editorial / Wall Street Journal

“Iran is so close to a nuclear bomb that we need to rethink how we watch for it. That’s the conclusion of a new report by veteran nuclear inspector David Albright and fellow researcher Sarah Burkhard at the Institute for Science and International Security. Both are highly regarded and fact-based analysts.

“Even as Iran increased its enrichment of uranium, the stance of U.S. intelligence – its ‘mantra,’ in the researchers’ telling – had long been that weaponization has been paused.  No longer.  The Office of the Director of National Intelligence’s July report now says Iran has ‘undertaken activities that better position it to produce a nuclear device, if it chooses to do so.’

“What kind of activities?  How long would it take to produce that device? We aren’t told.  If we were, Mr. Albright and Ms. Burkhard write, ‘some uncomfortable truths would come out: Iran can do it way too quickly, and initial activities to build the bomb could be difficult to detect and could predate any effort to enrich up to weapons-grade.’....

“ ‘This has changed over the last two years, but dramatically in the last several weeks,’ the researchers write.  Iran has been allowed to enrich uranium right up to the breaking point, and lately it has expanded a crucial fortified complex near the village of Fordow.’  ‘Iran can now ironically break out quickly, in days, using only its deeply buried Fordow facility,’ the report says....

“ ‘If the U.S. is serious about its goal to stop Iran from having a nuclear weapon, detecting nuclear weaponization activities is increasingly significant as a trigger to act.’....

“ ‘Iran can make a crude nuclear weapon far faster than commonly assessed,’ the researchers warn.  ‘Earlier Institute assessments concluded that Iran could do so in six months. It could be shorter today.’

“We have seen since Oct. 7 what Iran does by proxy, and in April it launched 120 ballistic missiles directly against Israel.  We may yet see more, as President Biden practices deference and sanctions relief and hides the truth from the public that the revolutionary Shiite regime may soon have the means to kill millions of Israelis – and Americans.  Would Kamala Harris or Donald Trump prevent an Iranian bomb? That, too, is on the ballot in November.”

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Wall Street and the Economy

Appearing on CBS’ “Face the Nation” Sunday, Bank of America CEO Brian Moynihan said consumers will be very dispirited if they don’t get an interest-rate cut next month.  The bond market has been certainly acting the same way.

But that was Sunday, and then this week we started out with July producer price data on Tuesday that was better than expected, up 0.1%, unchanged ex-food and energy, and much better than forecast year-over-year, 2.2% on headline, 2.4% on core when 3.0% was expected.  All good, Treasury yields dropped on the news.

Prior to the release of Wednesday’s crucial consumer price figures for last month, the 2-year Treasury yield was 3.93%, down from last Friday’s close of 4.05%, and the 10-year was at 3.83%, down from 3.94%.

And the CPI was virtually exactly as expected, 0.2% on both headline and core, 2.9% and 3.2%, year-over-year, the first time we were below 3% since March 2021.

But bond yields didn’t fall further and odds for a 50-basis point cut in September at the Open Market Committee meeting fell below 50%, and then Thursday, we had a stronger than expected retail sales figure for July, by a lot, up 1.0%, 0.4% ex-transportation, vs. consensus of 0.3% and 0.1%, respectively.

By week’s end, bond yields were slightly lower vs. last Friday’s close on the 10-year, and essentially unchanged on the 2-year.

A few other economic data points...July industrial production was down a worse than expected 0.6%, while July housing starts were well below consensus at an annualized pace of 1.238 million, the lightest since May 2020 (the pandemic), though it is possible this was influenced by Hurricane Beryl.

The federal budget deficit for the month of July was -$244 billion.  For the first ten months of the fiscal year (ending Sept. 30), the deficit is $1.5 trillion.

The Atlanta Fed’s GDPNow barometer for third-quarter growth is at 2.0%, down from last week’s 2.9%.

Freddie Mac’s 30-year fixed-rate mortgage is 6.49%.

As for next week, there is one very big item on the agenda...Federal Reserve Chair Jerome Powell’s annual address on the economic outlook next Friday in Jackson Hole, Wyoming.

The annual gathering of global central bankers offers Powell a chance to give an updated assessment of the U.S. economic trajectory and the outlook for monetary policy, as the market looks ahead to the September Open Market Committee meeting.

It is expected Chair Powell will offer a hint or two on the direction of interest rates, though I expect he’ll still be somewhat guarded and talk of it being about the data, while making it clear the Fed is prepared to move. 

The next big inflation barometer for the Fed is the personal consumption expenditures index, which is to be released the following Friday, Aug. 30.

Europe and Asia

We had a flash reading for second quarter GDP for the euro area, up 0.3% compared with the previous quarter, according to Eurostat.  In the first quarter, GDP also grew by 0.3%.

Compared with the same quarter a year ago, GDP grew 0.6% in the EA20.

GDP Q2 2024 over Q2 2023

Germany -0.1%, France 1.1%, Italy 0.9%, Spain 2.9%, Netherlands 0.8%.

UK GDP is estimated to have increased 0.6% in the second quarter over the first, and 0.9% compared with Q2 2023, according to the Office for National Statistics.

Separately, June industrial production in the eurozone fell 0.1% over May, -3.9% year-over-year.

Britain: Prime Minister Keir Starmer has handled the unrest fueled by misinformation rather well so far.  More than 900 were arrested and 466 charges, which is exceedingly swift for the British justice system.  The courts acting in such a fashion is definitely a reason why the riots ended so abruptly.

But now the courts must maintain capacity to deliver swift justice to keep tensions down.  And it’s important to work with tech platforms to manage content which has been used to incite violence or worsen community relations.

And....Starmer is still facing criticism from Elon Musk.  Over the weekend, Musk described arrests related to the riots as “messed up” in a post on X and responded “true” to a post from Nigel Farage calling the prime minister “the biggest threat to free speech we’ve seen in our history.”

Oh, puh-leeze.  Farage is such a jerk.

Turning to Asia...China released a slew of economic data out of the National Bureau of Statistics for the month of July.

Industrial production was up 5.1% year-over-year, retail sales 2.7% Y/Y, and fixed asset investment up 3.6% year-to-date.

The unemployment rate rose from 5.0% to 5.2% in July and what I find fascinating about this, is that for those who believe China manipulates its data, which in most categories it does, a 0.2% jump month-over-month is rare.  But analysts say it likely reflected a wave of graduates entering the jobs market.

Japan had a surprising jump in second quarter GDP, 3.1% annualized over a miserable first quarter, owing to a pickup in consumption.  The 3.1% reading was also well above the consensus forecast of 2.1% and backs up the Bank of Japan’s forecast that a solid economic recovery will help inflation sustainably hit its 2% target and justify raising interest rates further...just not now after the hiccup last week in the stock market.

July producer prices rose 3.0% year-over-year, in line.

Meanwhile, Japanese Prime Minister Fumio Kishida won’t run for a second term as leader of the long-ruling Liberal Democratic Party in September, opening the door for a new party member to take over the post of premier.

Given the LDP’s dominance in parliament, the winner of its leadership race, expected for late September, is virtually assured of becoming the next prime minister.

Support for Kishida has been waning amid voter frustration over his handling of a wide-ranging party slush-fund scandal, ongoing inflation and a slump of the yen.

Meanwhile, the government had issued a week-long mega-earthquake warning for Japan’s Pacific coast, which even if it does not come, may put off tourists and drag down consumption.  The warning was lifted yesterday.

Street Bytes

--Monday, August 5th, is a distant memory.  A crash in Tokyo (from which it has more than recovered), and severe indigestion in the U.S. markets, and boy, have we recovered as well.

We just had the best week of the year, the inflation data buttressing the case for a rate cut in September.  The Dow Jones was up 2.9% to 40659, the S&P 500 3.9%, and Nasdaq 5.3%, breaking an ugly 4-week skid.

--U.S. Treasury Yields

6-mo. 4.97%  2-yr. 4.06%  10-yr. 3.89%  30-yr. 4.15%

All about Chair Powell and Jackson Hole next week. No market-moving economic data.

--On Monday, OPEC revised its 2024 global oil demand growth forecast downward to 2.11 million barrels per day, from the previous estimate of 2.25 million barrels per day, citing weaker data and a decline in Chinese demand.  The 2025 world oil demand forecast was also revised lower, to 1.78 million barrels per day from 1.85 million barrels per day.  OPEC+ extended its production cuts until September, with a gradual phase-out beginning in October.

The International Energy Agency then said in its monthly report that global oil demand growth is still forecast to slow to under a million barrels a day this year and next, the IEA also citing a continued slowdown in Chinese consumption.

The Paris-based IEA estimates that global demand will grow by 970,000 barrels a day this year and by 953,000 barrels a day in the next – marginally lower than prior estimates.  Total demand is expected to average 103.1 million and 104 million barrels a day this year and next, respectively.

So, you see OPEC is more optimistic in overall demand growth than the IEA by about a million barrels a day.

As for the price action this week, tensions lessened some in the Middle East with the ceasefire talk and crude fell a little

--Walmart shares surged 8% on the open Thursday after the company had another quarter of strong sales that topped almost all expectations with its comparatively low prices proving a powerful draw for millions who have struggled with rising costs for housing, groceries and almost everything else.

The nation’s largest retailer also raised its full-year outlook in a sign of confidence in its business model.

WMT reported earnings of $4.5 billion, with adjusted per share EPS of 67 cents in the three months ended July 31, 2 cents better than expectations.  Sales rose nearly 4.8% to reach $169.33 billion, also beating expectations.

Comparable store sales, which include online and stores open for the past 12 months, rose 4.2% in the U.S., compared with 3.8% in the first quarter, and 4% in the fourth quarter. That’s solid.

Global e-commerce sales rose 21% (22% in the U.S.), matching the first quarter’s pace.

The number of transactions, and the average amount customers spent during each of those transactions at Walmart, was higher than it was during the same three months last year.

And in a potentially encouraging shift, Walmart said sales of discretionary items like clothing and electronics were flat to very slightly positive.  Americans for two years have been focusing on essentials, taking a pass on non-essentials, and spending that money on groceries and other basics.

Walmart has stepped up discounts and during the most recent quarter, the retailer had 7,200 price rollbacks.

For the year, WMT said it now expects earnings per share to be in the range of $2.35 to $2.43, up from its previous estimate of $2.23 per share to $2.37.  Analysts projected $2.44.  The company is projecting annual sales to be up anywhere from 3.75% to 4.75%, after previously expecting sales would rise 3% to 4%.

For the current quarter, Walmart expects adjusted EPS to be in a range of $0.51 to $0.52, while the Street is at $0.55.  Sales are pegged to be up 3.25% to 4.25%.

--Home Depot forecast a decline in annual profit and a bigger drop in its annual comparable sales on Tuesday, as hopes of a recovery in demand for home improvement projects fall due to higher borrowing costs. Big-scale projects such as flooring, kitchen cabinets and bath have been put on the back burner as customers tackled steep inflation.  Higher mortgage rates and home prices have also dented demand in the housing market and deterred customers from investing in big-ticket home renovation projects.

Weak new home sales in May and June led to foot traffic dropping 0.4% in July after a 4.3% rise in June, according to data from Placer.ai.  Comparable sales fell 3.3% in the second quarter, compared with expectations of a 2% drop.

“During the quarter, higher interest rates and greater macroeconomic uncertainty pressured consumer demand more broadly, resulting in weaker spend,” CEO Ted Decker said.

Home Depot expects annual comparable sales to decline between 3% and 4% for fiscal 2024, compared with its prior forecast of a decline of about 1%.

The world’s largest home improvement specialty retailer also expects adjusted earnings per share to decline between 1% and 3% for the fiscal year, compared with an earlier forecast of a rise of about 1%.  Overall sales are expected to grow between 2.5% and 3.5%, up from its previous guidance for an approximately 1% rise.

Q2 adjusted earnings came in at $4.67 per share, which beat consensus of $4.49. Sales edged higher to $43.18 billion, including $1.3 billion from its recent acquisition of building-products supplier SRS Distribution. The market was at $42.7 billion.

Initially, shares fell on the blah report, but they finished Tuesday slightly higher.

--Deere & Co. beat analysts’ expectations for fiscal third-quarter profit on Thursday, as stronger pricing and cost control measures protected its margins from sluggish demand for its farm equipment, sending shares of the company up 4% before the bell.

The company reported a third-quarter net income of $6.29 per share, compared with consensus of $5.63, $1.73 billion, down 42%, but still ahead of the Street’s view for $1.6 billion.  Net sales and revenue decreased 17% to $13.15 billion.

For 2024, the maker of tractors, mowers, and combines sees net income of $7 billion, just ahead of consensus for $6.94bn.

U.S. machinery makers have succeeded in maintaining the price increases they implemented two years ago, a move that was prompted by supply chain complications and a surge in demand for industrial and agricultural equipment.  The higher prices have helped farm equipment makers to shield their profits from a slowdown in demand for new machines amid a decline in crop prices and high borrowing costs, which have also forced dealers to limit inventory restocking. 

U.S. farm incomes are forecast to plunge in 2024 due to the sharp decline in commodity prices, heightened production costs and shrinking government support.

Deere is cutting a reported 600 jobs at three manufacturing plants in the U.S. as it shifts production to a new facility in Mexico.

--The Port of Los Angeles processed more container units last month than any other July on record*, driven by retailers eager to get their holiday goods in early.

*The Port of L.A. – the busiest container hub in the U.S. – handled a total of 939,600 twenty-foot equivalent units in July, a 37% increase over the previous year.

“Toys, clothing, footwear and electronics are arriving now to avoid risk later in the year,” said Port of Los Angeles Executive Director Gene Seroka on Tuesday.  “These goods are coming at the same time as our more typical back-to-school, fall fashion and Halloween merchandise.”

Importers have moved peak season earlier as they try to get ahead of tariffs, Red Sea cargo diversions, and a potential strike by East and Gulf Coast dockworkers starting in October, Seroka told reporters Tuesday.

--JetBlue shares had their worst day ever on Monday, down 21%, as investors were alarmed by a series of moves by the company to turn to the debt market to borrow money for its general operations and to cover a fast-approaching debt payment while it grapples with declining profits and sales.  The three big ratings agencies – S&P, Moody’s and Fitch – all lowered their ratings on JetBlue’s bonds in response.

Among the financial moves the airliner made were $2.75 billion in debt using their frequent flier program as collateral, a financing option employed during the pandemic...but we are no longer in a pandemic.  There was another $400 million in debt in the form of convertible notes, or about $3.2 billion in total, some of which will be used to purchase a portion of the debt that expires in 2026, but for balance sheet purposes, it needs to be addressed before April 2025.

JetBlue already had $5.37 billion in total debt as of June 30, according to its latest earnings release.

--As for the plane crash last Friday as I was going to post that killed 62 near Sao Paulo, Brazil, a Sao Paulo-bound flight, aviation experts around the world watching videos showing the plane spinning slowly at it plummeted from 17,000 feet before crashing almost directly on its belly, the question of what happened was simple to answer: The plane had stalled.

“You can’t get into a spin without stalling,” said John Cox, an airline pilot for 25 years who now aids plane crash investigations.  “It’s A plus B equals C.”

Why VoePass Flight 2283 might have stalled remains a mystery, though an ice buildup on its wings could have been a major contributor, but as the experts say, it’s never one thing.

Brazilian officials had issued a warning about the potential for severe icing where the plane was flying when it crashed.  And as the New York Times reported, “a different passenger plane had experienced such icing nearby, the pilot of that plane told the Brazilian news channel Globo.”

There are systems on the plane that crashed – an ATR 72-500 turboprop built in 2010 – that combat icing.

“Did the crew activate the anti-icing system?” asked Jeff Guzzetti, a former crash investigator with the Federal Aviation Administration.  “Or did they activate it and it failed?”

As the Times noted, “Icing was a main cause of a 1994 American Eagle crash of the same ATR plane model in Indiana, but the manufacturer has since improved the de-icing system.”

John Cox said that the plane was traveling roughly 325 miles per hour when its speed dropped sharply in the minutes before the crash.  The speed did not drop far enough to cause a stall, he said, unless icing was extremely severe.

“If there is enough ice, then it changes the shape of the wing, and that could cause it to stall at a much higher speed,” he said.

But the pilots should have been able to see the ice on the wings and windshield wipers, experts said, and if the system to break up the ice malfunctioned, pilots could have lowered the plane’s altitude, where warmer air would have melted the ice.  “We’re talking about Brazil here, not Antarctica,” Cox said. 

But if the pilots were going to a lower altitude, they should have notified air traffic controllers and there was no such declaration...or the communication failed.

--Boeing received some good news, securing a new aircraft deal with Israel’s flag carrier El Al worth as much as $2.5 billion.

The order includes up to 31 of its 737 MAX aircraft, which would replace the airline’s current all-Boeing fleet of 737-800 and 737-900 jets.

--TSA checkpoint numbers vs. 2023

8/15...105 percent of 2023 levels
8/14...104
8/13...100
8/12...106
8/11...106
8/10...107
8/9...104
8/8...106

--I am seldom surprised by anything related to Wall Street and Corporate America, but Tuesday morning we had a stunning announcement at 8:00 a.m. ET.  Starbucks had pushed out its CEO Laxman Narasimhan and was replacing him with Chipotle Mexican Grill CEO Brian Niccol.

This was titanic.  It was like a huge baseball trade that shocks fans of both teams involved.  And that it occurred on perhaps the biggest week of summer vacation on Wall Street, I was thinking of all the analysts and traders who were caught flat-footed.  [Not that I felt the least bit sorry for any of them.]

But this was huge.  You know that personally I couldn’t give a damn about Starbucks, but it is Starbucks...a huge name.  And Chipotle has been wildly successful under Brian Niccol.

Laxman Narasimhan had been CEO for less than two years.  Niccol transformed Chipotle into a juggernaut, with the stock price gaining more than 700 percent...700...since he took over as CEO in 2018.  As Mansour Javidan, an Arizona State University professor who studies executive leadership told the Washington Post, Starbucks is “bringing in a CEO who understands how to ask the right questions, how to figure out what the solutions are and make things happen... This is a guy who can do execution and implementation in a rapidly changing environment.”

And Starbucks needs execution and implementation, that’s for sure.  For Narasimhan, it didn’t help that longtime leader Howard Schultz was constantly looking over his shoulder, with Schultz in May posting on his LinkedIn account that the company’s declining U.S. sales were “the primary reason for its fall from grace.” Schultz, who has not had any role in the company since April 2023, called on the company’s senior leaders to “spend more time with those who wear the green apron.”

Narasimhan followed the advice and got behind the counter, but it was too late.  Most recently, sales declined 3 percent globally for the second quarter.

Starbucks, among other issues, including price, faced a big problem with efficiency.  There were growing wait times and outdated technology and processes.  And there was growing competition, soaring inflation and shifting consumer behaviors. And then labor issues emerged.

Chipotle has had some of the same issues, especially on price, grumblings over smaller portion sizes, but the bottom-line results and the share price continued to rock.  Brian Niccol was able to face the issues head on and solve them.  But he has his work cut out for him now.  [He’s also being very well compensated, as you can imagine, and will get a long honeymoon to turn the ship around.]

Tuesday, the day the change was announced, Starbucks shares soared 24%!  Chipotle’s fell 7%.  [CMG’s COO, Scott Boatwright, is acting as interim CEO.]

Starbucks has $36 billion in annual revenues and 38,000 stores across more than 80 countries, while Chipotle’s $10 billion in annual revenues is spread across 3,500 restaurants, a business mostly in the U.S.

--Cisco Systems’ shares rose 5% Thursday after the company reported fiscal Q4 earnings of $0.87 per share, down from $1.14 a year earlier, though consensus was at $0.85.

Revenue for the quarter ended July 27 was $13.64 billion, down from $15.20bn a year earlier.  Analysts expected $13.54 billion.

The network equipment giant expects current quarter EPS between $0.86 and $0.88 and revenue ranging from $13.65 billion to $13.85bn, both basically in line with current Street forecasts.  For fiscal 2025, the company sees EPS of $3.52 to $3.58 and revenue between $55 billion and $56.2 billion, with consensus at $3.55 and $55.68bn.

“We saw steady customer demand with order growth across the business as customers rely on Cisco to connect and protect all aspects of their organization in the era of AI,” Cisco CEO Chuck Robbins said in an earnings release.

But Cisco also said it was cutting 7% of its global workforce, which was the main reason for the surge in the share price, its second found of cuts after announcing in February it would reduce its workforce by 5%, or 4,000 jobs.

--The United Auto Workers Union said on Tuesday it has filed charges with the National Labor Relations Board against Donald Trump and Elon Musk over attempts to threaten and intimidate workers.

The action came after Musk and Trump held a two-hour conversation on X on Monday night, during which Trump complimented Musk’s ability to cut costs by saying he would not tolerate workers going on strike.

“You’re the greatest cutter,” Trump said during the conversation.  “I mean, I look at what you do. You walk in, you just say: ‘You want to quit?’  They go on strike – I won’t mention the name of the company – but they go on strike. And you say: ‘That’s okay, you’re all gone.’”

Musk chuckled but didn’t respond to Trump’s comments, so not sure what the UAW is thinking in including him in the complaint in terms of finding Elon liable.

Under federal law, workers cannot be fired for going on strike, and threatening to do so is illegal under the National Labor Relations Act.

It’s unclear whether the NLRB would take action against Trump for his comments, but it was incredibly stupid for Trump to hand Democrats a major gift with the statement.  While many UAW workers don’t listen to management and Shawn Fain and are voting for Trump anyway, once again, those on the fence are the ones both campaigns are going after in the key battleground states, such as Michigan. The UAW endorsed Harris at the end of July.

Fain said in a statement on Tuesday: “Both Trump and Musk want working class people to sit down and shut up, and they laugh about it openly.  It’s disgusting, illegal, and totally predictable from these two clowns.”

--Walt Disney is planning to expand attractions at its theme parks over the next decade, including increasing its cruise ship fleet, the entertainment giant said on its parks website Sunday.

Disney’s Magic Kingdom in Florida will get a new villains-themed area featuring two major rides, along with new lands inspired by Pixar’s “Cars” and “Monsters, Inc.” movie franchises.

New attractions are also planned for the Animal Kingdom park in Florida, and Disneyland.

And the company is adding four new ships to its cruise fleet, which currently has five cruise ships in operation.  The new ships are expected to begin operating between 2027 and 2031.

--Subway called an emergency meeting with franchisees of its 19,000 North American sandwich shops as they grapple with faltering sales and profits, as reported by the New York Post.

The fast-food giant – which sold itself to Roark Capital, owner of Dunkin’ Donuts, Arby’s and Cheesecake Factory – told franchisees it will reveal plans to improve traffic and win back market share.

Discounting is the key topic.  A Subway franchisee with nearly 20 stores told The Post his same-store sales are down 5% to 10% in recent weeks compared to the prior year.  He blames the chain’s recent price promotions as customer traffic has dropped.

“They are doing crazy coupons,” the franchisee griped.  “Our gross sales are not even at 2012 levels, and profit then was five times what it is today.”

--Trump Media & Technology shares (DJT) fell as the former president got back on X.  Trump has 7.5 million followers on Truth Social (DJT), but 89 million followers on X.  Investors have been treating DJT as a proxy for the market’s bet for a second Trump administration.

--The Covid-moved Tokyo Olympics averaged 15.6 million viewers per night in 2021 across NBC’s various television and digital platforms. The 2022 Beijing Winter Olympics averaged 11.4 million across all platforms, the least-watched Olympics in the modern era, and a sharp decline from the 19.8 million average for the 2018 Winter Games in Pyeongchang, South Korea.

But NBCUniversal posted a 16-day total audience for the Paris Games of 31.3 million viewers on average across the 2-5 p.m. ET and 8-11 p.m. ET/PT hours.  Some of the viewership was extraordinary, such as 12.7 million viewers on NBC and Peacock live on a Tuesday afternoon to see Simone Biles and Team USA win gold.

To be fair to the other Olympic telecasts, NBC did roll up its numbers for Paris to include live viewership in the afternoon.  I’m an example of one who only watched then.  I did not watch a single minute in the evening.  Had I not had an opportunity to watch the key events at the pool and on the track live, I of course would have watched at night to catch the action.

Looking ahead to Los Angeles, at the pool and on the track, the live action for the big races will most likely be crammed into the 9:00 p.m. to 11:00 p.m. ET slot, but that is 6:00 to 8:00 p.m. local.  The L.A. Games are being held in July.  Let’s hope the area isn’t in the midst of a major heatwave then in terms of the action on the track.

--Susan Wojcicki, who helped turn Google from a start-up in her garage into what it is today, and then led YouTube, died last weekend at the age of 56, lung cancer.

As the New York Times reported: “Her more than two decades working with Google began in 1998 in her house in Menlo Park, Calif., part of which she rented to her friends Larry Page and Sergey Brin, the company’s founders.  For $1,700 a month, the two used the garage as their office to build the search engine.”

Wojcicki, who was working at Intel, joined Google as one of its first employees and was its first marketing manager. She would end up becoming Google’s most senior woman employee.

Wojcicki then led YouTube after Google acquired it in 2006.

“She is as core to the history of Google as anyone, and it’s hard to imagine the world without her,” Sundar Pichai, Google’s chief executive, said in a statement.

--Peter Marshall, the longtime host of “The Hollywood Squares,” died Thursday at the age of 98.

Marshall, an actor, singer and comedian, played straight man on one of the most popular game shows on television, certainly one of my 2 or 3 favorites, from 1966 until 1981.  The show was certainly unique in its risqué humor for a daytime game show, and it made Paul Lynde famous as the center square.  He was absolutely hilarious, some of the celebrities on the set fueled by alcohol, as legend has it...filming five shows in a day. 

The alcohol was consumed at the lunch break after the first three shows...setting the tone for the afternoon session.  As Peter Marshall once said, “Everyone would drink, the wine flowed.  The last two shows were hysterical.” [Washington Post]

--Finally, we note the passing of Howie Cohen, an advertising copywriter, who along with colleagues came up with the Alka-Seltzer catchphrases “Try it, you’ll like it” and “I can’t believe I ate the whole thing.”

The thing is, Cohen, 81, died on March 2 in Los Angeles but it just became widely known last weekend.

Foreign Affairs, Part II

China: Beijing’s top spy agency says it has uncovered more than 1,000 cases of Taiwanese espionage during a crackdown and vowed to keep up the pressure on the island’s pro-independence forces.

In a WeChat post on Tuesday, the Ministry of State Security said the cases were revealed in a series of special operations launched in recent years and that it had continued to “strike hard” against spying activities.

It said the cases involved espionage and the theft of state secrets, and it had destroyed “a large number of spy intelligence networks” set up by Taiwanese in mainland China.

“[We have] severely punished spies who carried out intelligence theft, infiltration and sabotage activities, in accordance with the law, effectively safeguarding the security of our country’s core secrets,” the ministry said in the post.

Taiwanese who live and work in China are planning their departures.  You can be accused of advocating for Taiwanese independence, even if you aren’t involved in such activities.  Among the punishments is the death penalty.

North Korea: Leader Kim Jong Un revisited a flooded area near the country’s border with China last weekend to address plans to support those affected by recent flooding, including bringing over 15,000 people to the country’s capital until new homes are built, state media KCNA said on Saturday.

Thousands of homes were flooded due to heavy rainfall, North Korea said last week, in flooding going back to July.  According to KCNA, the military organized around 10 planes to make roughly 20 trips each to rescue 4,200 people within a half-day after the region was hit by heavy rainfall from the remnants of Tropical Storm Gaemi.

Kim thanked those countries and international organizations that have reached out to North Korea, offering assistance, but said the country will “forge its own path with its own strength and effort,” KCNA quoted Kim as saying.

On Sunday, North Korea said Vladimir Putin offered humanitarian aid. South Korea’s Red Cross said the South was ready to provide the North with relief supplies.

So, obviously, Pyongyang has a very big problem on their hands, as suspected weeks ago and only now being acknowledged.

Venezuela: From the New York Times: “The Venezuelan government has mounted a furious campaign against anyone challenging the declared results of the vote, unleashing a wave of repression that human rights groups say is unlike anything the country has seen in recent decades.

“ ‘I have been documenting human rights violations in Venezuela for many years and have seen patterns of repression before,’ said Carolina Jimenez Sandoval, president of the Washington Office on Latin America, an advocacy and research organization.  ‘I don’t think I have ever seen this ferocity.’”

We’re talking you could be walking down the street, coming out of a store, stopping by a friend’s house, and you’re suddenly arrested.

Separately, the Biden administration is pursuing a long shot bid to get President Maduro to step down in exchange for amnesty from the Department of Justice indictments he, and associates, face.  The U.S. in 2020 placed a $15 million bounty for information leading to Maduro’s arrest on charges of conspiring with his allies to flood the U.S. with cocaine.

A United Nations panel of electoral experts said that Venezuela’s electoral authority did not follow regulatory provisions when it published July election results and the lack of detailed results is without precedent in contemporary elections.

Presidents Biden and Brazil’s Lula have floated the idea of a new election, but as Venezuelan opposition leader Maria Corina Machado put it in ruling out the idea, “The election already happened.  Maduro must be made to know that the cost of his staying grows with each day that passes.”

Afghanistan: A United Nations agency reported that the Taliban has deliberately deprived 1.4 million Afghan girls of schooling through bans.  Afghanistan is the only country in the world that bans female secondary and higher education.

The Taliban, who took power in 2021 after President Biden’s disgraceful withdrawal from the country, barred education for girls above sixth grade because they said it didn’t comply with their interpretation of Sharia, or Islamic law.  They didn’t stop it for boys and show no sign of taking the steps needed to reopen classrooms and campuses for girls and women.

UNESCO said at least 1.4 million girls have been deliberately denied access to secondary education since the takeover, an increase of 300,000 since its previous count in April 2023, with more girls reaching the age limit of 12 every year.

“If we add the girls who were already out of school before the bans were introduced, there are now almost 2.5 million girls in the country deprived of their right to education, representing 80% of Afghan school-age girls,” UNESCO said.

This is all on Joe Biden, and as I’ve written countless times before, Republicans are idiots for not making this a campaign issue.  It’s more than about Abbey Gate.  It’s about the simple fact that if we had maintained the minimal force we had in the country at the time Biden withdrew, Kabul would have remained a safe zone for Afghan girls to get an education.  You saw the stories prior to the summer of 2021 of how the girls were thrilled, they had dreams of becoming doctors, lawyers, teachers.  This is what American women who vote can relate to!

Alas, Republicans on this topic have a very flawed candidate himself.  It’s infuriating.

Thailand: Parliament here picked Paetongtarm Shinawatra, the daughter of billionaire tycoon and former leader Thaksin, as prime minister.

At 37, she will be the country’s youngest PM and the second woman in the post, after her aunt Yingluck.

Her selection comes just two days after former PM Srettha Thavisin was dismissed by a constitutional court because of an ethics violation.

But Paetongtarn faces the difficult task of reviving Thailand’s stalled economy and avoiding the military coups and court interventions which have deposed four previous administrations led by her party.

Random Musings

--Presidential approval ratings....

Gallup:  36% approve of President Biden’s job performance, 58% disapprove; 31% of independents approve (July 1-21).

Rasmussen: 46% approve, 53% disapprove (Aug. 16).

--A Fox News national survey had Vice President Harris trailing Donald Trump by one point, 49-50 percent.

President Biden’s job approval rating was 41%.

--But a New York Times / Siena College poll released last weekend of likely voters in the three battleground states of Michigan, Wisconsin and Pennsylvania, Kamala Harris is ahead of Donald Trump by four points in each, 50% to 46%.

--Donald Trump, campaigning in Asheville, N.C., Wednesday, told his audience that his campaign team wanted him to talk about his ideas for the economy because voters say it’s the most important issue they’re facing. But the former president then quickly pivoted to personal critiques of Kamala Harris while voicing his regret that Joe Biden was no longer the Democrats’ nominee.

“Today we’re going to talk about one subject and then we’ll start going back to the other, because we sort of love that, don’t we?” Trump said.  “They say it’s the most important subject.  I’m not sure it is, but they say it is the most important.”

--On a two-hour call between Donald Trump and Elon Musk on X, after glitches delayed the conversation, David Frum / The Atlantic:

“The X Spaces interview delivered Donald Trump without makeup or dress-up, talking unselfconsciously: manic, boastful, untruthful, aggrieved, abusive, obsessive, random, ignorant, tedious, bitchy – and ultimately, formless and endless.  You might think a major-party presidential nominee would have other claims on his time, some sort of deadline, if only to get some sleep to ready himself for the next day’s campaigning.  But no.  At no point in the explosion of talk could one guess whether it would continue for another five minutes or another five hours....

“Musk had a rational plan for last night’s event.  An interview with a major-party presidential candidate drives traffic.  A fawning and flattering interview might well buy favor for Musk from a possible future Trump administration.  Sure enough, Trump offered Musk a position on a hypothetical commission to purge waste from government spending.  Musk enthusiastically accepted....

“Meandering, solipsistic, and crushingly boring – the interview was an awful premonition of the rest of Trump’s life should he lose again, in November: wandering the corridors of his clubs, going from table to table, buttonholing the dwindling number of guests, monologuing relentlessly until they squirm away.”

--Gerard Baker / Wall Street Journal

“We need to talk about Donald.

“We can complain all we like, as I have, that the coronation of Kamala Harris by deceitful Democrats and a complaisant media is depriving voters of any understanding of what they are being asked to vote for in November. But we can’t ignore the giant Republican problem either: None of us are in any doubt what we are being asked to vote for on the Republican ticket....

“We need to be clear about the problem.  It isn’t, as some have suggested, that Mr. Trump has been wrong-footed by the Democrats’ switch from Mr. Biden to Ms. Harris.  Nor is it a reflection of accelerated degeneration. The Trump of the past few weeks has looked and sounded more or less exactly like the Trump of nine years ago.

“This is the problem.  It is this Mr. Trump who lost the presidency in 2020. It is this Mr. Trump who lost the House in 2018 and the Senate in the Georgia runoff election in January 2021.

“Why did he win in 2016?  Because he was new and up against the most tediously familiar and disliked politician in America.  Even then, he only squeaked past Hillary Clinton by a total of fewer than 90,000 votes in the three decisive states.

“All this explains where we are now. This is the same old Mr. Trump, but this time he is up against something the American people are being sold as new.  Those of us who paid attention may know that Ms. Harris is a seasoned hardliner with extreme views, but most voters don’t.  They see a blank slate onto which they are invited to project anything they like.

“Mr. Trump’s performances as he traipses around the country again are reinforcing the illusion of that choice. Instead of telling them consistently and repeatedly what they are actually getting if they vote Democrat, he is merely reminding them what they will get again if they vote Republican.

“Mr. Trump has unusual political skills. I don’t disdain the voters who have backed him as the way to express their disgust at a rotten, complacent political establishment – on both sides – that has dominated Washington for too long.  I commend them.

“But, if things don’t change, the ranks of those voters won’t be enough to outweigh others who simply can’t face another four years of the Trump show and will back even a party hack concealing her real politics simply to escape it.”

---

Pathetically, in a series of posts Sunday, Trump falsely claimed that “nobody” attended Vice President Harris’ Michigan rally last week, falling for a far-right conspiracy theory – one easily disproved by photos and videos captured by attendees and media showing thousands of supporters at the event at an airport hangar near Detroit.

“Has anyone noticed that Kamala CHEATED at the airport?  There was nobody at the plane, and she A.I.’d’ it, and showed a massive ‘crowd’ of so-called followers, BUT THEY DIDN’T EXIST!” Trump wrote on Truth Social.  “She was turned in by a maintenance worker at the airport when he noticed the fake crowd picture, but there was nobody there, later confirmed by the reflection of the mirror like finish on the Vice Presidential Plane....

“She’s a CHEATER.  She had NOBODY waiting, and the ‘crowd’ looked like 10,000 people! Same thing is happening with her fake ‘crowds’ at her speeches,” Trump added.  “She should be disqualified because the creation of a fake image is ELECTION INTERFERENCE.  Anyone who does that will cheat at ANYTHING!”

Oh brother.

Trump, at a campaign event Thursday in Bedminster, billed as a discussion about fighting antisemitism, singled out Miriam Adelson, the Israeli-American widow of the casino magnate Sheldon Adelson, whom Trump awarded the Presidential Medal of Freedom while in office.

“Miriam, I watched (Sheldon) sitting so proud in the White House when we gave Miriam the Presidential Medal of Freedom.  That’s the highest award you can get as a civilian; it’s the equivalent of the Congressional Medal of Honor [Ed. it’s the “Medal of Honor,” not Congressional Medal....], but civilian version.  It’s actually much better, because everyone gets the Congressional Medal of Honor – that’s soldiers.  They’re either in very bad shape because they’ve been hit so many times by bullets, or they’re dead,” Trump said.

“She gets it and she’s a healthy, beautiful woman, and they’re rated equal,” he said.

I’m biting my tongue.

--On the failure of Kamala Harris to neither give a sit-down interview nor hold a news conference, the Washington Post editorialized:

“The ‘vibe’ around the vice president’s campaign launch has been undeniably strong among Democrats, but she can’t bask in it forever. The more substance Ms. Harris can offer before the election, the more control she will have over what voters think of her and the more of a mandate she would have to govern should she prevail in November.”

--President Biden said during an interview with CBS News for the Sunday Morning program that he ended his reelection bid after hearing from congressional Democrats that he’d hurt their down-ballot chances in November, providing his fullest explanation yet of his decision to drop out.  Pursuing a second term bid would have been “a real distraction.”

--Vice presidential nominee Tim Walz and Republican vice-presidential candidate J.D. Vance have agreed to debate on CBS on October 1st.

In his first solo campaign appearance, Tuesday, Gov. Walz pushed back on GOP attacks on his military service and the timing of his departure from the Army National Guard.

“I firmly believe you should never denigrate another person’s service record,” Walz said at a union convention.  “To anyone brave enough to put on that uniform for our great country, including my opponent, I just have a few simple words: Thank you for your service and sacrifice.”

At least three of Walz’s former Guard colleagues have publicly expressed disappointment about his decision to leave the service when the unit was preparing to go to war in Iraq.  Walz ultimately chose to leave the Guard in 2005 to run for Congress and won a House seat the following year.

On Tuesday, Walz noted that he signed up for the Army National Guard two days after his 17th birthday with encouragement from his father, who served in the Army during the Korean War, and he said he did so because of his love for his country.

“In 2005, I felt the call of duty again, this time giving service to my country in the halls of Congress,” Walz said on Tuesday.  “My students inspired me to run for that office, and I was proud to make it to Washington.  I was a member of the Veterans’ Affairs Committee and a champion of our men and women in uniform. I’m going to say it again as clearly as I can, I am damn proud of my service to this country.”

Trump allies, and J.D. Vance, have focused fresh scrutiny on Walz’s comments during a 2018 gubernatorial campaign event where he stated “we can make sure those weapons of war that I carried in war” are not on America’s streets.  A campaign spokesman acknowledged Friday that Walz “misspoke” during the 2018 exchange.

Walz didn’t discuss the 2018 exchange on Tuesday, which he should have!  But now Vance will have a shot at bringing up the episode in their debate.

--Analysts and intelligence experts warned Sunday that wider efforts may be underway by foreign powers to disrupt the U.S. presidential election, after the Trump campaign said it believed its email systems had been breached by hackers working for Iran.

--Independent presidential candidate Robert F. Kennedy Jr. sought a meeting last week with Kamala Harris to discuss the possibility of serving in her administration, perhaps as a Cabinet secretary, if he throws his support behind her campaign and she wins, according to Kennedy campaign officials.

Harris and her advisers have not responded with an offer to meet or shown interest in the proposal.

Since Joe Biden dropped out, RFK Jr.’s poll numbers have declined.

RFK Jr.’s campaign was dealt a blow on Monday when a judge ruled that his petition to appear on New York’s ballot was invalid, saying Kennedy had used a “sham” address to maintain his New York residency.

The ruling, if it stands, would keep Kennedy off the ballot in a state where he lived for much of his adult life and could endanger his efforts to be placed on the ballot in dozens of other states.

--New Jersey Gov. Phil Murphy (D) is set to appoint his former chief of staff, George Helmy, to replace disgraced Sen. Bob Menendez, who is stepping down Aug. 20.

Helmy will thus maintain the Democrats’ 51-49 majority in the Senate.  He isn’t a candidate for the seat in the November election, which pits Democratic Rep. Andy Kim against Republican Curtis Bashaw.

--The Biden administration is taking a victory lap after federal officials inked deals with drug companies to lower the price for 10 of Medicare’s most popular and costliest drugs, but shared few immediate details about the new price older Americans will pay when they fill those prescriptions.

The White House said Wednesday it expected U.S. taxpayers to save $6 billion on the new prices, while older Americans could save roughly $1.5 billion on their medications.  But the administration gave no details as to how they arrived at the figures.

Thursday, in the first joint appearance by President Biden and Veep Harris (and probably last...if I was Harris), they touted the new program, part of the Inflation Reduction Act, but the new prices don’t go into effect until 2026.  They represent cuts to individual list prices that do not reflect any rebates and discounts the government may already be getting for the drugs.

Drugmakers voiced their opposition to the new discounts that they said would not necessarily lower out-of-pockets costs for the prescription medicines in 2026.

--Rep. Ilhan Omar of Minnesota, a member of the dwindling “Squad” and frequent critic of Israel, won her primary Tuesday, 56-43, over Don Samuels, a former Minneapolis City Council member who came within 2,500 votes (2 percent) of ousting her in the 2022 primary.

--The rapid spread of mpox, formerly called monkeypox, in African countries constitutes a global health emergency, the World Health Organization declared on Wednesday.

The WHO last designated mpox an epidemic back in July 2022. That outbreak went on to affect nearly 100,000 people, primarily gay and bisexual men, in 116 countries, and killed about 200 people.

The threat this time is deadlier. Since the beginning of this year, the Democratic Republic of Congo alone has reported more than 14,000 mpox cases and 524 deaths.  Those most at risk include women and children under 15.

“The detection and rapid spread of a new clade of mpox in eastern D.R.C., its detection in neighboring countries that had not previously reported mpox, and the potential for further spread within Africa and beyond is very worrying,” said Dr. Tedros Adhanom Ghebreyesus, the WHO’s direct general.

The outbreak has spread through 13 countries in Africa.  This is a big deal.  The WHO also confirmed on Thursday that a case was confirmed in Sweden, the first sign of mpox’s spread outside the continent.  Swedish health officials said at a press conference that the person was infected while in Africa

--Hunter Biden sought assistance from the U.S. government for a potentially lucrative energy project in Italy while his father was vice president, according to newly released records and interviews.

As reported by the New York Times’ Kenneth P. Vogel, who broke the story:

“The records, which the Biden administration had withheld for years, indicate that Hunter Biden wrote at least one letter to the U.S. ambassador to Italy in 2016 seeking assistance for the Ukrainian gas company Burisma, where he was a board member.

“Embassy officials appear to have been uneasy with the request from the son of the sitting vice president on behalf of a foreign company.

“ ‘I want to be careful about promising too much,’ wrote a Commerce Department official based in the U.S. Embassy in Rome who was tasked with responding.

“ ‘This is a Ukrainian company and, purely to protect ourselves, U.S.G. [U.S. Government] should not be actively advocating with the government of Italy without the company going through the D.O.C. [Department of Commerce] Advocacy Center,’ the official wrote.”

Abbe Lowell, a lawyer for Hunter Biden, said his client “asked various people,” including the U.S. ambassador to Italy at the time, whether they could arrange an introduction between Burisma and the president of the Tuscany region of Italy, where Burisma was pursuing a geothermal project.

“No meeting occurred, no project materialized, no request for anything in the U.S. was ever sought and only an introduction in Italy was requested,” Lowell said in a statement.

The release of the documents comes as Hunter prepares to stand trial next month on charges of evading taxes on millions of dollars in income from Burisma and other foreign businesses.

--Columbia University President Minouche Shafik resigned after a tumultuous period sparked by protests over the war in Gaza, becoming the third Ivy League leader to depart over turmoil tied to the conflict and accusations of antisemitism on campus.

Shafik announced on Wednesday she was stepping down immediately after a little over a year in the job.

“Over the summer, I have been able to reflect and have decided that my moving on at this point would best enable Columbia to traverse the challenges ahead.”

--Thursday, five people were charged with having roles in the overdose of “Friends” star Matthew Perry ten months ago.

One or more arrests had been expected since investigators from three different agencies revealed in May they had been conducting a joint probe into how the 54-year-old Perry got such large amounts of ketamine.

The actor had been among the growing number of patients using legal but off-label medical means to treat depression, or in other cases chronic pain, with the powerful surgical anesthetic. 

--Hurricane Ernesto knocked out power to nearly half of Puerto Rico this week and has its eyes set on Bermuda, Saturday, as a probable Category 2. Not good at all.

--Scientists have discovered a reservoir of liquid water on Mars – deep in the rocky outer crust of the planet.

The findings come from a new analysis of data from NASA’s Mars Insight Lander, which touched down on the planet back in 2018.

The lander carried a seismometer, which recorded four years of vibrations – Mars quakes – from deep inside the Red Planet.

But analysis of the quakes revealed “seismic signals” of liquid water.

While there is frozen water at the Martian poles and evidence of vapor in the atmosphere, this is the first time liquid water has been found on the planet.  The findings are published in the Proceedings of the National Academy of Sciences.

By measuring how fast seismic waves travel, scientists have worked out what material they are most likely to be moving through.

“These are actually the same techniques we use to prospect for water on Earth, or to look for oil and gas,” explained Prof. Michael Manga, from the University of California, Berkeley, who was involved in the research.

The water is at depths of about 6 to 12 miles in the Martian crust.

Well, you know what they say, sports fans.  Where there is water, there could be Martians.

--Finally, you know that victory bell in the Olympic stadium in Paris that winning athletes rang in celebration?  It’s terrific that the bell is getting a new home – a restored Notre Dame. The cathedral’s reopening is slated for December, following more than five years of rebuilding after its 2019 fire.

The cathedral’s rector, Rev. Olivier Ribadeau Dumas, said the bell will hang in the roof above the altar and be rung whenever Mass is celebrated.

The chimes will thus serve as lasting reminders of the Games “extraordinary atmosphere” and Olympic-inspired “unity of the French people that was very beautiful,” he said.

“This bell will be the sign of how these Games have left an imprint on France,” Dumas said.  “That really makes me happy.”

The Paris Olympics were truly memorable for all the right reasons.

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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 $2544...record high today
Oil $76.73

Bitcoin: $59,657 [4:00 PM ET, Friday]

Regular Gas: $3.43; Diesel: $3.75 [$3.87 - $4.33 yr. ago]

Returns for the week 8/12-8/16

Dow Jones  +2.9%  [40659]
S&P 500  +3.9%  [5554]
S&P MidCap  +2.6%
Russell 2000  +2.9%
Nasdaq  +5.3%  [17631]

Returns for the period 1/1/24-8/16/24

Dow Jones  +7.9%
S&P 500  +16.5%
S&P MidCap  +8.3%
Russell 2000  +5.6%
Nasdaq  +17.5%

Bulls 44.6
Bears 21.5

Hang in there.

Brian Trumbore

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