[Posted 7:00 AM ET]
Iraq
Conservative New York Times columnist David Brooks labeled
the current situation in Iraq a “crisis of confidence” and clearly
the opinion polls reflect this, with 58% of Americans now
disapproving of President Bush’s handling of Iraq and 54% also
now saying going to war was “not worth it.” [USA Today /
CNN / Gallup] At the same time various surveys show the
president’s overall approval rating at 44-46%, the worst levels of
his presidency.
Bush is being hurt by a “combination of arrogance and
incompetence” [Fareed Zakaria / Newsweek] and while I agree
with Brooks in his statement “The cause is still just” he’s also
correct in saying it’s easy to follow this up with ‘yeah, but…’
One thing is for sure, as Brooks concludes, future presidents will
find it increasingly difficult to commit troops into some global
hot spot, and for many of us that’s distressing.
I go back to the period from last May 1 (following the “mission
accomplished” speech) through September 1 as the president
never once went before the American people nor recognized the
need for an immediate infusion of troops. It is one thing to stay
the course…it’s another not to correct mistakes.
George Will wrote this week that the “failures are multiplying”
and so let’s focus on four examples: Fallujah, Abu Ghraib,
Donald Rumsfeld and the issue of contractors.
Fallujah
I wrote the following back on 4/3/04:
“I was disturbed that the Marines did not go in after the
contractors were killed, but history is replete with bad generals,
many of whom attained their position by kissing ass all the way
up the chain, not because they were brilliant strategists…”
And so it is that I found a piece this week by former Colonel
Ralph Peters, a huge supporter of the war, to be bang on.
“We bragged publicly that we would avenge the mutilation of
those four contractors at the hands of Fallujah’s thugs. We told
the world we would not stop until the city was cleansed of
insurgents. And, of course, we swore we would never negotiate
with terrorists.
“What did we actually do? We negotiated with terrorists, re-
empowered Saddam’s thugs in uniform and ran away as quickly
as we could go. The Marines insist they could have won, had
they been allowed to fight. That’s unquestionably true, but, as
North Vietnam’s senior general once pointed out about a
different war, it’s also irrelevant.
“The diplomats claim we backed down to spare the innocent
people of Fallujah. But they didn’t lift a finger as the city’s Arab
fanatics drove out Fallujah’s Kurdish population. And how does
it benefit the average citizen to leave gunmen in control –
protected by Ba-athist thugs who tell us mockingly that there
‘aren’t any foreign fighters in the city’? Right. And there are no
politicians in Washington.
“Our threats have begun to sound as hollow as those made by
Gaddafi in his prime. Our power means nothing unless we are
willing to use it decisively…
“And our enemies are telling the Muslim world that they fought
the U.S. military to a standstill. For once, they’re telling the
truth. It doesn’t matter that they won politically, not militarily.
They won.
“We’ll pay for our failure in Fallujah for years to come. The
message our enemies took from their success was that Americans
don’t have the stomach it takes to win. Far from fostering peace
in our time, our cowardice in Fallujah will encourage no end of
attacks on Americans.”
[New York Post]
Abu Ghraib
As George Will wrote, “Americans cannot flinch from the facts.”
I watched every minute of the Senate hearings featuring Maj.
Gen. Antonio Taguba and I admired his performance as he
stated succinctly that Abu Ghraib was about a “failure in
leadership from the brigade commander on down, lack of
discipline, no training whatsoever, and no supervision.”
Look, 90% of Americans understand there is no moral
equivalency between the abuses at Abu Ghraib and the
beheading of Nicholas Berg, but to slough off the actions at the
prison as Oklahoma Senator James Inhofe did was ridiculous. I
side with the thoughts of Senator Evan Bayh and the “need to
preserve our moral integrity and honor” and of Senator Lindsey
Graham, who said “When you say you’re the good guys, you
have to act like the good guys,” adding “We can’t become them.”
I have been deeply troubled this week by some of what I have
heard and read. No one has to tell me what we’re up against, but
it’s a slippery slope we’re on and trust me, we don’t want to go
there.
The facts of Abu Ghraib and other investigations taking place
into other prisons are that at least 14 prisoners have died in U.S.
custody in Iraq and Afghanistan [Defense News] and that
Defense Secretary Rumsfeld and Joint Chiefs of Staff General
Richard Myers didn’t think it was important enough to read the
reports from the International Red Cross and General Taguba,
both warning of abuses, until very recently. That’s simply
unfathomable. Myers, as you all now see, is the classic butt-
boy I have written of so extensively. But let’s take a look at
Donald Rumsfeld.
Your editor wrote the following a year ago, 5/10/03, after
watching “Secretary Rumsfeld in Afghanistan proclaim that the
war there was over and all was hunky dory. ‘Bull,’ I thought.
‘He’s lying.’”
“Donald Rumsfeld has lost me…His cowboy schtick (has) grown
old….
“I have long warned that the Bush administration needed to stay
focused on the long haul, that it has to remain committed,
even as the American people invariably sour with each passing
year. Secretary Rumsfeld, on the other hand, seems more
concerned with cutting and running. The U.S. has far too few
troops in Afghanistan, with Kabul being the only secure area in
the whole freakin’ country. And the U.S. general on the ground
in Baghdad said the other day that the remaining American
forces there were stretched way too thin. I’m sure parents of
loved ones stationed in both countries like to hear Rumsfeld’s
talk of bringing everyone home quickly, but this isn’t necessarily
serving our interests, and plays into the hands of the very radical
elements I thought we were trying to exterminate.
“A lot of hard-core conservatives don’t get it, either. William
Kristol correctly states that President Bush understands the Big
Picture, but then Kristol doesn’t recognize we are mucking
things up in Afghanistan and Iraq. If we don’t set up the models
of freedom here, we’ll never succeed elsewhere, like in Iran.
“The United States stayed in Germany and Japan for years
following World War II to ensure an orderly transformation to
democracy. Rumsfeld’s model, on the other hand, is doomed to
fail.”
So fast-forward a year later to this week as President Bush told a
Pentagon and world audience that the secretary of defense is
“doing a superb job” while Vice President Cheney said Rumsfeld
is “the best secretary of defense the United States has ever had…
People ought to get off his case and let him do his job.” Spare
me. In a separate column from the earlier cited one, Ralph Peters
weighed in.
“It isn’t treason to tell the truth in wartime. But it verges on
treason to lie. And Rumsfeld lies….
“Rumsfeld’s ‘vision’ was to lavish money on the defense
industry and administration-friendly contractors, while sending
too few troops to war, with too little battlefield equipment,
inadequate supplies and no long-range plan. As one Army
colonel put it in the heat of battle, ‘We’re wining this despite
OSD [Office of the Secretary of Defense].
“Contractors grow rich. The Army grows exhausted. And every
single prediction about the future of warfare made by the
Rumsfeld gang proved incorrect. Airpower doesn’t win wars on
its own. Technology doesn’t trump courage, guts and skill. Both
war and its aftermath still require adequate numbers of well-
trained, disciplined troops. And serious planning.”
Donald Rumsfeld has gutted the military and for the umpteenth I
have to add, heaven forbid Kim Jong il crosses the line. The
only way to avoid South Korea’s annihilation would be to go
nuclear (assuming Kim didn’t go first) and that would guarantee
50 years of darkness.
Lastly, we have the contractor issue, Rumsfeld’s pet project. On
this I can’t help but repeat something I wrote on 9/13/03,
regarding President Dwight Eisenhower’s prescient farewell
address. [See “Hott Spotts” archives for the full speech.]
‘In the councils of government, we must guard against the
acquisition of unwarranted influence, whether sought or
unsought, by the military-industrial complex. The potential for
the disastrous rise of misplaced power exists and will persist.’
“I can guarantee that Eisenhower today would be disturbed by
Donald Rumsfeld’s bid to privatize many military functions.
Afghanistan’s President Karzai, for example, is tailed by security
guards affiliated with a Halliburton subsidiary, not the U.S.
Army. Can these gentlemen (admittedly, most are ex-Army vets)
be possibly screened better than current U.S. soldiers for such
duty? No.
“Or what about those whom Rumsfeld wants to contract out to
do aircraft maintenance? The chances for sabotage seem far
greater…just thinking outside the box.
“Of course as was pointed out in a Business Week piece, one
reason for using contractors, as in Colombia, is that you don’t
need congressional approval. The whole thing stinks…
“Eisenhower also weighed in on the matter of foreign policy
during the same brilliant speech:
‘Any failure traceable to arrogance, or our lack of
comprehension of readiness to sacrifice would inflict upon us
grievous hurt both at home and abroad.’”
Last week I said the United States had to be virtually perfect in
everything we do to maintain the support needed to fight the
global war on terror. We are under the microscope, whether we
like it or not. We are also the lone superpower. It’s time we
acted like one, through the use of both our strength and in the
exhibition of moral courage. Regarding the latter we are quickly
taking the steps to address Abu Ghraib and that alone has to be
the example for the world. But we also have to recognize severe
damage has already been done and this is not easily reversible.
On the issue of strength, our brave men and women can not have
died in vain. Fallujah is a historical mistake, but it’s not too late
to correct it and others. I pray President Bush gets it.
—
Wall Street
This week ended up being mostly about oil, with crude (as
measured by the W. Texas variety) hitting an all-time high,
closing at $41.38. More importantly for the consumer right now,
the average price of gasoline at the pump is at a record $1.95 and
maybe $2.00 by the time some of you read this. And with
natural gas well above $6.00, just wait until we all start receiving
our electric bills as we begin to crank up the air-conditioning.
That will be the biggest story in July as folks begin to see it
reflected in their June statements. The combination of the price
at the pump and the utility bill will undoubtedly lead to less
spending elsewhere, as Wal-Mart admitted this week when it
came to the impact of gasoline prices.
But as for crude, the International Energy Agency has suddenly
revised its worldwide demand forecast up to 80.6 million barrels
per day, when it wasn’t too long ago we were talking about
maybe 78.5. These seemingly incremental moves up in demand
are huge in a world of greatly limited supply thanks to a host of
issues – most importantly the failure to explore for and find giant
new fields, the fact many old ones are nearing the end of the line,
a lack of maintenance, a lack of refinery capacity, soaring
demand from the likes of China and India, political issues a la
Venezuela, and a freakin’ lack of commitment on the part of
most Americans, particularly our representatives in Congress, to
bite the damn bullet and adopt a national, broad-based energy
policy!!
And you think oil is high now, heaven forbid terrorists take out a
tanker or two in the Strait of Malaca I wrote so extensively on
last week, or the Straits of Hormuz, sending insurance rates
skyrocketing and many tanker owners back to port.
However…for those of you contemplating a plunge into oil and
gas stocks just remember that the big gains have already been
made in these shares, as I correctly forecast (thus far) weeks ago
in paring back my own exposure from about 35 to 6 percent of
my overall portfolio. This is best represented by the OSX, the oil
service index, which rose from a low of about 82 to the 100-110
range and now sits back below 100, even as the price of crude
has risen further. I have also said I’m going to be patient before
plunging back into a sector that has treated me spectacularly over
the years and I see no reason to change that opinion now.
As for the rest of Wall Street, there was a slew of important data
on the inflation front with the 0.7% increase in April producer
prices being a negative surprise, but then Friday’s consumer
price print of up 0.2% for the same period balanced it out (even
though ex-food and energy it rose a solid 0.3%). Meanwhile,
retail sales were down but industrial production was up. Throw
it all together and you get a slightly down week for equities,
though volatility earlier on reflected much lower prices than
Friday’s closing numbers.
The better inflation picture, helped by the feeling among some
that higher energy prices will take a substantial bite out of
consumer spending, led to the belief that perhaps Federal
Reserve Chairman Alan Greenspan is correct in being sanguine
about increasing interest rates in measured amounts. That would
be the wrong opinion to take, but even interest rates don’t
normally go straight up without a little rally every now and then
as the hot money sloshes about.
As for the corporate profit picture it remains strong but
remember, the rebound in this area was helped to a great extent
by the falling dollar and it’s been rallying a bit recently.
Combine this with rising interest rates and my point would be it’s
going to get harder and harder to beat expectations by a penny, if
you catch my drift, and as we saw with the likes of Cisco and
Dell this past week, companies need to substantially beat to see a
bump in share prices.
Finally, I have been saying for years now that cash is not always
trash and have issued warning after warning on bond funds,
specifically the leveraged variety. I hope some of you took my
advice and at least lightened up a bit. Maybe we take a little
breather in the sector but just remember there’s more damage to
come.
Street Bytes
–Stocks were down sharply at mid-week, with the Dow Jones
hitting a low of 9852, before rallying back on Wednesday. The
Dow finished the week at 10012, off 1%, while Nasdaq lost 0.7%
to close at 1904. Nasdaq is now down 5% for the year.
–U.S. Treasury Yields
6-mo. 1.33% 2-yr. 2.54% 10-yr. 4.78% 30-yr. 5.50%
The 10-year bond hit 4.90%, a 2-year high in yield, Friday
morning before rallying back.
–The European Union offered to eliminate farm subsidies as a
way to jumpstart global trade talks, but France immediately said
the E.U. was exceeding its mandate. The U.S. responded it was
amenable to realistic negotiations, while the developing nations
weren’t holding their breath.
–Citigroup set aside $4.95 billion for legal costs associated with
class-action suits in WorldCom ($2.65 billion of it), Enron and
others. Even for a behemoth like Citigroup, this is a huge
number, sports fans, and to paraphrase Yogi Berra “It still ain’t
over ‘till it’s over.”
–IBM is developing software that allows corporations to bypass
Microsoft’s operating system on PCs and handheld devices.
–We bid adieu to CNBC’s Maria Bartiromo as she leaves the
floor of the New York Stock Exchange to focus on her other
responsibilities at the network. I have to hand it to her; she was a
real pioneer as so many said this week. But I can report an
exclusive…fully half of the e-mails from Wall Street firms under
various investigations the past few years had to do with Maria’s
ever-changing hairstyle…and other stuff…
–Google is making a big mistake in waiting around before
bringing its IPO. The longer it does so, the faster interest wanes.
–Dick Grasso told Charlie Gasparino of Newsweek that he feels
he’s owed an apology by the NYSE “for destroying his
reputation” and only then would he consider coughing up some
of his compensation. Grasso does have one point I’ll agree with;
his former buddies on the compensation committee, such as
Goldman’s Hank Paulson, were more than a bit disingenuous in
turning on him.
–Federal regulators jacked Riggs Bank up against the wall and
slapped it with a huge $25 million fine for lack of oversight in
the money laundering activities of Saudi Ambassador Prince
Bandar and others.
–UBS was fined a whopping $100 million by the Federal
Reserve, among the three highest penalties ever levied by
Greenspan’s bunch, for currency transactions with the likes of
Libya, Cuba, Iran and the former Yugoslavia, all countries under
U.S. sanctions at the time. Supposedly, no funds were going to
terrorist organizations in this instance, but for the Fed to come
down on you, you have to have really screwed up.
–Dell Computer met earnings expectations but didn’t exceed as
was rumored, plus the company spoke of higher component
prices damping earnings growth potential in the near future. The
combination sent the shares slightly lower and would certainly
appear to limit upside for at least the balance of this year.
–MCI, the company with the beautiful commercials proclaiming
“what a wonderful world” is laying off an additional 7,500 on
top of 5,700 previously announced.
–So I’m taking a taxi back from Newark Airport last Sunday and
go past Lucent’s headquarters. Everything had bloomed since I
left for Asia two weeks earlier and as we approached Lucent all
seemed green, but then…what’s this? Dandelions…groves of
them. I turned away in disgust.
But to be fair, later in the week I had cause to call Lucent (why is
not important) and I was switched right into the chairman’s
office. Judy M. took my call, listened to my request, promised to
get back to me right away and did. Super, super service. But
does this experience cancel out the Lucent lawn indicator which
has held me in good stead? To be continued…
–The securities industry accounted for 200,000 jobs in New
York City in 2000 but by 2003 that total had dropped to 159,000.
The forecast for ’04 is for a gain of around 17,000…a solid
rebound.
–I didn’t see one SUV on the streets of Singapore, but I walked
into a showroom in Shanghai and saw one there. Uh oh, I
thought. If the Chinese start buying them in significant numbers,
$50 oil is a certainty.
–The first thing I did when I got back home from Asia was
update the software on all my computers to prevent the Sasser
worm, which had popped up while I was away. So I’d like to
thank the German teenager responsible for it for wasting a ton of
my friggin’ time.
–Inflation Update: Mark R. reports a case of Corona is up to $31
in his neighborhood, and as the two of us agree that’s
outrageous! Meanwhile, ice cream is rising by anywhere from
6-20%, as cows extract further kickbacks from producers, cows
having the upper hand these days in all negotiations over milk
prices. Speaking of dairy, my friend Jimbo is very pleased his
son Liam eats his Kix cereal without milk, thus saving Dad
$thousands, which in the end could mean Liam gets to go to
college after all.
–Disney exceeded expectations with their quarterly earnings
report as attendance at theme parks rebounded strongly. But will
soaring gasoline prices impact summer traffic?
–Update: Dirtball Herb Axelrod, the fugitive who once sold $50
million worth of rare instruments to the New Jersey Symphony
for $18 million, is now being investigated by the FBI because of
the likely inflated value of this transaction as well as Axelrod’s
sale of four Strads to the Smithsonian in 1998. And the U.S.
Senate Finance Committee has begun an investigation into
Axelrod as part of a broader look at charitable donations in
general…terrific news, as long-time readers will readily
recognize.
–Among my many warnings on the Russian stock market was
one I issued in this space 4/17/04 in discussing a glowing piece
that had appeared in the previous Sunday’s New York Times.
Well it turns out the Russian market peaked around then and as
of this Wednesday was off 26% from the record high.
–Cisco Systems revenues for the past quarter were up 22% and
the company is hiring 1,000 workers to meet growing demand
but like Dell the stock did zippo as investors still aren’t satisfied,
plus it’s not as if Cisco is really cheap.
–The SEC is investigating ties between the brokerage firms and
their proprietary mutual funds and the placement of shares into
those funds where there is an investment banking relationship,
whether the company is a dog or not. No investigation is needed,
really. If I’m the SEC I go to the funds and say “Don’t argue…
we know what you’re doing. Now fork over $2 billion or we’ll
take your children.” That would clean up the b.s. right quick.
–My portfolio: I remain 80% cash (really around 82% thanks to
depreciation in the equity holdings), though I brought home $5
worth of yuan from my Asian adventure. I also have a $25 chip
from the MGM Grand in Las Vegas that I just found, but that’s
a different story.
Foreign Affairs
India: Wow, what a shock. The rural poor voted thumbs down
to Prime Minister Vajpayee’s leadership and the new prime
minister will be Italian born Sonia Gandhi, of the political firm
of Gandhi, Gandhi & Gandhi. At first, the Bombay market
rallied when it was apparent that Gandhi’s Congress Party would
be able to cobble together a majority, but it tanked on Friday
over fears that despite Sonia’s reassurances she won’t follow all
of Vajpayee’s progressive economic reforms. But I’m more
concerned over India’s future relations with both Pakistan and
the U.S. Regarding the latter my grand vision of a supra-alliance
between the U.S., Britain, Australia, India and Japan is off the
boards while any Gandhi is in power, the Congress Party not
having been a big friend of the U.S. in the past. [Though
Washington deserves its share of criticism in this regard.] As for
Vajpayee, he showed incredible vision in his last few years and
should be remembered fondly.
Russia: President Vladimir Putin’s 2nd term started off with a
bang…a disastrous terrorist attack against his hand-picked man
to lead Chechnya, President Akmad Kadyrov. Incredibly,
security forces didn’t detect an explosive device planted under a
grandstand (or insiders prevented it from being detected), an
amazing lapse. Security 101, for crying out loud.
Not that I give a damn about Kadyrov, a former rebel leader
turned Kremlin butt-boy. What should be distressing to Putin
watchers, though, was his quick elevation of Kadyrov’s 27-year-
old son Ramzan to deputy prime minister of Chechnya. As even
the Moscow Times noted, the “thuggish and uneducated son (ran
a) brutal security force that terrorized the civilian population.”
In light of this, and my past comments on Putin, I strongly urge
you to take a look at my 5/13 piece on “Hott Spotts” concerning
Russian attitudes in general. It’s rather enlightening.
China: After posting a piece from Shanghai last week I saw in
the local paper that retail sales for the holiday week there were
up 53% over a year earlier, though a lot of this rise is due to the
comparison with a period where SARS was the story.
Nonetheless, a rather hefty gain.
Meanwhile, I was reading a review of Thomas P. Barnett’s book
“The Pentagon’s New Map” which has received a large amount
of publicity in think-tank circles and Mr. Barnett makes the case
that China is now too connected to the world economy to risk
war. To which I say ‘bunk,’ especially in light of the state of
relations between the U.S. and many of its so-called allies these
days. Should China and the U.S. become embroiled in a contest
over Taiwan, for example, do you think the rest of the world will
care and risk losing access to the China market? Of course not…
and this also goes back to comments I’ve made in the past
concerning dangerous alliances between business tycoons and
foreign governments whose friendships they curry. An obvious
case in point is Hong Kong, where this week Beijing told the
Legislative Council (Legco) in Hong Kong to shut up and stop
criticizing the central government. At the same time mainland
companies are being told by Beijing not to advertise in pro-
democracy newspapers in Hong Kong.
North Korea: On Friday, the foreign minister, speaking from
Beijing, announced his government would never dismantle its
nuclear program as the United States continues to demand,
calling it a “humiliating measure.” Of course Pyongyang has
said this a thousand times before but to state it from Beijing,
where he had been holding talks, is a little more meaningful.
The six-party negotiations are a mess and Kim Jong il knows the
Bush administration won’t compromise before the election,
which also means Kim’s Orcs can just go along about their merry
way, churning out more nukes for the 2004 Christmas season.
South Korea: As expected, impeached President Roh has been
returned to power following a Constitutional Court decision that
cleared him of the most serious charges of wrongdoing, such as
the opposition’s claim of “incompetence.” Roh favors the
sunshine policy in relations with North Korea and Washington
has obvious problems with this.
Israel: Just a horrible week as 11 Israeli soldiers were killed in
two separate attacks and scores of Palestinians in retaliation.
Hamas dismembered a few bodies and refused to turn them over.
Prime Minister Sharon’s plans to withdraw from Gaza are a
shambles. And I have to note this dispatch from Reuters on
Friday that provides further clues on how hopeless the situation
is.
“Israeli armored bulldozers began razing homes row by row in a
Gaza refugee camp on Friday in an operation apparently intended
to widen a flashpoint corridor Israel controls on the Egypt-Gaza
border, witnesses said.
“They said bulldozers had demolished 10 houses and were
threatening many more in the Rafah refugee camp as part of a
plan to destroy dozens or even hundreds of structures in the area
where militants killed five Israeli soldiers on Wednesday.”
And so it just goes on and on and on………
Separately, the Washington Post’s Jackson Diehl had a good
piece on Washington’s total embrace of Libya’s Gaddafi. While
Gaddafi has done everything we have requested of him, to many
moderate Arabs it only solidifies the position of Arab presidents-
for-life and hurts any reform efforts in the region, let alone the
impact of the Bush administration’s total support for Israel.
Syria: President Bush imposed economic sanctions on Syria due
to its failure to secure the Iraqi border and its sheltering of
terrorists. No other nations followed our lead.
Britain: British Prime Minister Tony Blair is facing a revolt
within his own Labor Party as only 4 in 10 in Britain now believe
the country was right to go to war, virtually identical to U.S.
sentiment. Finance Minister Gordon Brown is the choice of some
in Labor to replace Blair soon. In my column of 1/31/04, I
predicted Blair would step down by year end in favor of Brown
citing health reasons. This may still pan out.
Random Musings
–Many conservatives such as yours truly are more than a bit
unhappy with President Bush these days and outside of his tax
cuts, on the domestic front just what has he done? As Dana
Milbank and Jonathan Weisman reported in the Post, some of us
don’t see any real vision, just a lot of sloppy talk and proposals
that go from the campaign stump to the back room in a flash.
Take tort reform, as but one example. We’re going nowhere fast
here. And with the aforementioned sliding poll numbers, I
believe Bush has to still seriously consider jettisoning Vice
President Cheney. I also agree with Pat Buchanan that in as
much as I personally want Rumsfeld to go, Bush runs the risk of
turning him into a martyr at this point in the season. With
Cheney it’s different. Rudy Giuliani would be a good choice,
though I’m irritated with him for a number of reasons these days.
–Just playing politics, I still like Bill Richardson as John Kerry’s
running mate but he obviously doesn’t bring much to the
electoral table. If Kerry goes with a Midwesterner, I understand
why Gephardt would be the favorite but I kind of like Evan Bayh
these days.
–The cost of the wars in both Iraq and Afghanistan is projected
to be $66 billion in 2005, on top of the $25 billion in additional
funding the Bush administration is now seeking. In other words,
as the economy improves and government receipts pick up, the
positive effect on the deficit could be totally negated by the war
costs.
–We note the death of a Dutch soldier killed in Iraq. The
Netherlands has been a solid ally of America, and it’s
appreciated.
–Certain issues, particularly with regards to religion, I hesitate to
get into but I can’t help but offer my support to Nancy Reagan
and her cause to increase stem cell research.
–Australia and the United States have reached an agreement
whereby up to 6 air marshals will be on flights between the two
countries.
–So here’s something for you. In the U.S., all of us with laptops
have to put them separately through airport screeners. I didn’t
have to do that once in Singapore, Hong Kong or Shanghai. In
fact each place I started to and was waved off. Now just take
Singapore. No one, except Israel, is tighter on security than it is
and I recently told you these two nations are the only ones
currently committed to putting anti-missile devices on all
commercial aircraft. So I submit to you that this whole laptop
issue is a giant waste of time in the U.S. I’m sure all three
locations noted above, however, opt for profiling instead and I
am pleased to note I pass the test.
–So Graydon Carter, editor in chief of Vanity Fair (not on my
reading list) is taking kickbacks from studios and others to
promote film projects, according to the New York Times,
including $100,000 from Universal to suggest “A Beautiful
Mind” be made into a film. Thus, Graydon Carter becomes a
candidate for StocksandNews “Dirtball of the Year:
Entertainment Category,” though admittedly Michael Jackson
appears to have a lock on the hardware at this point.
–Thailand’s Prime Minister Thaksin, who has his hands full with
a possible gathering insurgency in the south of the country,
nonetheless is finding time to put a group together that appears to
have an inside track in buying into the English Premier League
football club, Liverpool. I have a growing audience in Thailand
but I have no idea what the people really think about this. Feel
free to send me a note, folks. I don’t sell my e-mail information,
incidentally. Never have, never will.
–I was pleased to see NASA is reconsidering its decision to let
Hubble die. I guarantee a repair mission would captivate the
country and it certainly would be a refreshing change from the
other headlines of the day.
–The International Olympic Committee said the Games are on!
I’ll still watch it from the comfort of my own home, thank you.
–The droughts in the western U.S., parts of Canada, and
Australia are at crisis levels and clearly have major inflationary
implications for food prices.
–I see where Brazilian President Luiz ‘Lula’ da Silva is in hot
water for expelling New York Times reporter Larry Rohter after
he wrote a story on Lula’s alleged drinking problem. I’ve been
meaning to write the president for his opinion on Brahma Light.
–You know who is supposed to be just a great guy? Actor
Jackie Chan. He was in Cambodia recently, using his celebrity
clout to raise funds for landmine and AIDS victims as chief
spokesman for UNICEF (a rare U.N. agency that actually
works). I bring this up because I’ll never forget meeting some of
his fans in Taiwan, who in turn had met him, and they couldn’t
stop raving about the man. He’s the real deal.
–I flew Dragonair from Shanghai to Hong Kong last weekend
and not knowing a thing about the airline, I’m here to tell you it
was a super experience…great service, food and gorgeous
stewardesses. A+++
–Finally, as I was walking around Hong Kong’s airport last
Sunday before heading home, it hit me how much I love Asia
and the people. After all, I’ve now been to the region 3 times in
just the past 4 years. The big thing you find traveling about in
these parts is the respect you are accorded. There is such a lack
of it in America these days, as best exemplified by various facets
of our pop culture. But there is a refreshing innocence in Asia,
as well as an overriding drive to succeed. [Americans see this
last bit every day in the performance of Asian students in our
schools.]
No doubt, the continent will continue to experience bumps along
the way (as in one coming up in China), but for now I’ll selfishly
focus on the tremendous treatment I have received while
traveling here. To my newfound friends, you’ve left me with
some great memories.
—
God bless the men and women of our armed forces.
God bless America.
—
Gold closed at $377
Oil, $41.38…black gold, Texas tea…
Returns for the week 5/10-5/14
Dow Jones -1.0% [10012]
S&P 500 -0.3% [1095]
S&P MidCap -0.9%
Russell 2000 -0.9%
Nasdaq -0.7% [1904]
Returns for the period 1/1/04-5/14/04
Dow Jones -4.2%
S&P 500 -1.5%
S&P MidCap -1.4%
Russell 2000 -2.4%
Nasdaq -5.0%
Bulls 44.6
Bears 25.7 [Source: Chartcraft / Investors Intelligence]
Have a great week. I appreciate your support.
Brian Trumbore
