[Posted 12:00 AM ET…from Hong Kong]
I’ve managed to keep up some despite missing almost two full
days traveling, but I’ll fill in any gaps next time. For now,
suffice it to say I had a better week than Don Imus, the Rutgers
women’s basketball team, or New Jersey Gov. Jon Corzine. At
least the Duke lacrosse players can begin to put their own lives
back together.
Here in Asia, the news has been dominated by the summit
meeting between Chinese Premier Wen Jiabao and Japanese
Prime Minister Shinzo Abe, the first visit by a Chinese leader to
Tokyo since 2000.
Mr. Wen’s trip was hailed by some as a “turning point” in Sino-
Japanese relations, even though little actual progress has been
achieved in the three days and the oil-field dispute in the East
China Sea threatens to foul any goodwill generated. China’s
CNOOC admitted it has been producing gas in a region claimed
by Japan. Japan has proposed to jointly explore the oil and gas
field but China is not likely to agree to this.
Premier Wen said at the opening banquet, “China-Japan ties are
at a crucial point of inheriting the past and opening up the future.
How the ties develop will have an important effect on the future
of our two nations and Asia.”
Then off camera, as reported in all the papers, Wen said “If we
can handle the history issue well, it would be a good foundation
for the development of bilateral ties. If not, it will become an
impediment.”
What it all comes down to is this. Prime Minister Abe’s
predecessor, Junichiro Koizumi, made annual visits to the
Yasukuni war shrine, seen by both China and South Korea, in
particular, as a symbol of Japan’s militaristic past. Abe thus far
has not gone there as prime minister, even though he was a
frequent visitor before taking office. Abe is smart enough to stay
away while still prime minister.
In a speech to the Japanese parliament, though, Wen also had
tough words for those supporting Taiwan.
“We will strive with all our might to achieve peaceful resolution
of the Taiwan issue, but we will never tolerate Taiwan
independence. We hope that Japan can understand the highly
sensitive nature of the Taiwan issue, abide by its pledges and
handle (it) prudently.”
Overall, Wen did receive high marks from both Japanese
lawmakers and the people. I also have to add that Wen truly is a
PR machine. He is known for jogging wherever he travels and
on Thursday, after a run in a Tokyo park, he did some Tai Chi
with the locals. A super photo op.
Wall Street
Breaking a recent up-down-up-down string, the major equity
averages all registered solid gains for a second straight week on
the heels of a tame producer price report on Friday (at least the
core figure), some good earnings news from the likes of Merck
and McDonald’s, and more mergers and acquisitions, including a
potential buyout by Blackstone Group of the largest student-loan
provider, SLM Corp., or Sallie Mae.
But earlier the markets were spooked, worldwide it turned out,
by release of the Federal Reserve’s minutes from its March Open
Market Committee meeting, wherein the Fed maintained its
“predominant policy concern remains the risk that inflation will
fail to moderate as expected.”
You know my own feelings on the topic; any inflation blip we
are experiencing, including in terms of rising energy and food
prices, is not a concern longer term as the economic slowdown
takes hold. And while I admit food inflation may be a bit more
ingrained for a variety of reasons, the Fed would be nuts to hike
interest rates just because you and I are paying 20 cents more for
a box of cereal. Again, this economy would flip in a nanosecond
if Chairman Ben Bernanke and crew ignore common sense and
raise the funds rate.
But I imagine some of you are thinking, is the economy really
slowing? You’d have a point, especially if you take a quick spin
around the world. The International Monetary Fund’s latest
forecast is for growth in China of 10% in 2007 and 9.5% in ’08,
Asia’s emerging markets at 8.4% this year, India’s at the same
clip…even Europe is now chugging along at a pace that meets or
exceeds the United States’ tepid 2.2% forecast for ‘07. It’s time
to face facts, sports fans. The U.S. is important, just not as much
so as it used to be because the rest of the world is catching up
…and some would say at lightspeed.
Of course one big financial accident, or terror attack that stops
international travel in its tracks, or a conflict over Iran’s nuclear
program, or the spread of avian flu…you get the picture. But
even I have to concede that doesn’t mean you ‘short’ today’s
market, necessarily. Just make sure every now and then that you
have replenished your supply of water, beer and Chex Mix.
Here in the good old U.S. of A., it does need to be noted, after
all, that consumer confidence continues to slide and a
Bloomberg/L.A. Times poll revealed that 6 in 10 of us now see a
recession within a year; not normally the background for
continued brisk spending on the consumer front.
And let’s face it; housing is still a big issue. Even the National
Association of Realtors, the ultimate shills for the sector, had to
admit existing home sales for 2007 will decline 2%, while home
prices will also fall for the first time since the NAR began
monitoring them in the 60s. D.R. Horton, the nation’s largest
homebuilder, wasn’t exactly singing a merry tune the other day
either when its chairman conceded “the spring selling season has
not gotten off to its usual strong start.” [Probably because,
nationwide, we appear to be transitioning back into winter…
especially if you’re a Cleveland Indians baseball fan.] D.R.
Horton added its cancellation rate for the quarter was a still
whopping 32%.
There are also increasing signs the subprime mortgage debacle is
spreading up the chain. American Home Mortgage Investment
Corp. drastically slashed its earnings forecast for the full year
because it saw signs of problems well beyond subprime. And
remember a few weeks ago when I noted that the states are
beginning to feel it in decreasing revenues? The New York
Times ran a piece on Sunday addressing this very issue. As one
researcher noted, aside from declining sales and real estate
transfer taxes due to the housing slump, it would also be foolish
to “underestimate the effect that the inability to extract equity
from homes is going to have.” For example, in Florida, 16% of
new car purchases in 2006 were made thru home equity loans. In
California it was 30%!
So what’s the real bottom line? If stock prices are in the long run
determined as much by earnings as anything else, don’t look for
them to continue to bail out equities much longer. We’re
beginning to hold onto our wallets, after all.
Street Bytes
–The Dow Jones picked up 0.4% to 12612, the S&P 500 added
0.6% to 1452, and Nasdaq tacked on 0.8% to 2524. All three are
now once again closing in on multi-year highs and February’s
case of indigestion is but a fleeting memory.
–U.S. Treasury Yields
6-mo. 5.08% 2-yr. 4.76% 10-yr. 4.76% 30-yr. 4.93%
Despite the solid reading on core producer prices, unchanged,
rates were little changed on the week because of the Fed’s
warning.
–The U.S. filed two complaints with the World Trade
Organization concerning China and its piracy and counterfeiting
of movies, music and books. China says it is doing all it can to
crack down and it has to be noted some small strides have been
made. Sometimes you also have to look at the real world and ask
yourself just how much can government do?
For example, the Motion Pictures Association of America says
that an average movie can be downloaded 1.7 million times
within 48 hours after it’s released online. The MPAA places its
losses in China at $2.7 billion, but with 45 million in the country
now having broadband access, it’s hard to stop. At the same
time, guess who is number 2 behind China in terms of piracy?
Try France…$1.5 billion.
Meanwhile, Beijing has begun announcing some cuts in
subsidies for various export industries in response to the U.S.
action to levy tariffs on coated paper from China. In other
words, if cooler heads prevail a trade war can be averted.
–Venezuela’s Hugo Chavez and Cuba’s Fidel Castro have been
ganging up on President Bush over the issue of ethanol, so I
present some recent thoughts by the hardly left-wing Economist.
“It is not often that this newspaper finds itself in agreement with
Fidel Castro….But when he roused himself from his sickbed to
write an article criticizing George Bush’s unhealthy enthusiasm
for ethanol, he had a point….America’s use of corn to make
ethanol biofuel, which can then be blended with petrol to reduce
the country’s dependence on foreign oil, has already driven up
the price of corn. As more land is used to grow corn rather than
other food crops, such as soy, their prices also rise. And since
corn is used as animal feed, the price of meat goes up, too. The
food supply, in other words, is being diverted to feed America’s
hungry cars.”
On the issue of America’s subsidies for the industry:
“(Ethanol) is just about the only alternative-energy initiative that
has broad political support. Farmers love it because it provides a
new source of subsidy. Hawks love it because it offers the
possibility that America may wean itself off Middle Eastern oil.
The automotive industry loves it, because it reckons that
switching to a green fuel will take the global-warming heat off
cars. The oil industry loves it because the use of ethanol as a fuel
additive means it is business as usual, at least for the time being.
Politicians love it because by subsidizing it they can please all
those constituencies. Taxpayers seem not to have noticed that
they are footing the bill.”
–China has another oil dispute, this one with Vietnam, which
Beijing accused of piping gas from the disputed Spratly Islands
in the South China Sea; islands also claimed by Taiwan, Brunei,
Malaysia and the Philippines.
We need a world conference on islands. “OK, you guys get
these two rocks and everything underneath it. China, pay
attention. You get these three…and nothing more.”
–Oil traders will be closely following the elections commencing
this weekend in Nigeria, the first civilian-to-civilian change in
government here. Violence has been breaking out as I write.
–Chipmaker Advanced Micro Devices warned its sales for the
first quarter will be a full 20% below the company’s own
projections due to the price war in the semiconductor sector. But
investors didn’t slam the stock because AMD also announced a
massive cost-cutting effort.
–Citigroup finally announced its formal plans after weeks of
conjecture; 17,000 will be laid off, or about 5% of the global
work force. The news was met by the Street with a yawn.
–Ray Irani, CEO of Occidental Petroleum Corp., took home cash
and prizes of $416 million in 2006; $270 million of which was
from exercising stock options. Why his salary, bonus and further
stock rewards were a miserly $53 million, we learned.
[I spent some time talking with my Chinese host this week about
the divide between the rich and poor, both in the U.S. and in
China. It’s far worse in China.]
–And just what was I doing in China? I have been investing in a
biodiesel company in Fuzhou and I thought I needed to kick the
tires before plowing any more of my precious assets into it. So I
contacted the CFO, a Wharton grad and China native, said I’d
like to come out, and he couldn’t have been more
accommodating. It was a tremendous experience for me, even if
the actual visit at the plant was a quick one. It was also kind of
funny that I had biodiesel all over the soles of my shoes and
when I stepped foot back in the airport afterwards, I forgot this
and almost fell flat on my butt. So I shuffled around thereafter.
People don’t bother you if you’re shuffling, incidentally.
But you know I refuse to mention individual company names I’m
investing in for a variety of reasons. It’s good for all of us that
way. But just as in the carbon fiber holding of mine, I’ve offered
enough clues so you can figure it out if you really want to. The
biodiesel stock is traded on Nasdaq, though daily volume is
anemic so if you ever decide to invest in it, place limits!
Over the coming weeks and months I’m likely to say quite a bit
more on this topic, but for now this particular company uses
vegetable oil and cooking waste in its process, both of which are
evidently in abundance in China. The potential is there, but like
in everything else it’s also about the execution and I have some
issues on that front. Enough said, except that on the labor front
you have to picture the average worker at the plant earns about
1/15th what he would make in the U.S.
–Want some good news on the real estate front? The median
price of a home sold in Southern California rose 4.6% in March
over a year earlier to $505,000. Want the bad news? Actual
sales were down 32%. And on the price front, they fell 5% in
San Diego County, just as my friend Josh P. predicted. In fact,
he told me this to the number, so it’s premium beer for the kid.
–I was reading a piece in Crain’s New York Business and I
found this pretty incredible.
“Late last month, (Blackstone Group) agreed to sell another 10
buildings that it acquired from Equity Office Properties Trust,
bringing its total proceeds to $25 billion. The Manhattan-based
firm paid Chicago real estate magnate Sam Zell $23 billion in
cash for 540 commercial properties two months ago, and it
assumed $16 billion in debt….
“Based on the average price Blackstone paid for the properties,
the return on its investment is an astounding 400%-plus in just
eight weeks.”
That’s tremendous, but if the market is so strong, why not hold
on for larger gains down the road? Aside from paring back its
real estate exposure before going public in its upcoming IPO, one
has to wonder whether or not the new buyers were suckers?
–You’ve gotta love World Bank president Paul Wolfowitz’s
chutzpah. He’s apologized for giving his girlfriend hefty pay
raises that saw her make more than Secretary of State
Condoleezza Rice, but employees at the World Bank are in revolt
and Wolfie will be history in short order.
–Finally, despite all the doom and gloom in the world, it’s clear
to me that Nestle, in acquiring Novartis’s Gerber baby-food unit,
is betting that Planet Earth will indeed survive. Or am I making
too much of this?
Foreign Affairs
Iran: I got a kick out of this story from the Iranian News Agency.
“Bells were rung at all schools throughout the country to mark
the ‘Great National Nuclear Feast.’
“In Tehran province, the bell at a girl’s elementary school in
northern Tehran was rung by Minister of Education Mahmoud
Farshidi on the occasion.
“The Iranian students celebrated the nuclear success of Iranian
scientists in pursuing peaceful nuclear energy.
“Chanting slogans such as ‘Nuclear energy is an inalienable right
of the Iranian nation,’ ‘No country has the right to deprive Iran of
its indisputable right,’ and ‘The Iranian nation is in need of
nuclear fuel cycle,’ the students voiced their support for the
undeniable right of the Iranian people in pursuance of peaceful
nuclear technology.”
I have to admit, when I was in elementary school I was chanting
“Let’s Go Mets,” but then times change.
President Mahmoud Ahmadinejad addressed his people and the
world. “Today we have announced a national day of nuclear
technology. In the past year, with continuous efforts, Iran has
succeeded in the nuclear fuel cycle development to attain
production at an industrial level. With great pride I announce, as
of today, our dear country Iran is among the countries of the
world that produces an industrial level of nuclear fuel.”
Now what this is all supposed to mean is Iran would have us
believe they have installed the magic number of 3,000
centrifuges, enough to spin out bomb grade material. Whether or
not they have actually attained this level, however, is subject to
much debate. If true, it would mean Iran could have enough
material for a nuclear device in as little as a year, though most
so-called experts are still saying 3-5 years and don’t believe
Iran’s claims. Regardless, we are one step closer to an
‘irreversible’ drive by Iran for its long-sought weapon and
intelligence services around the world really have no clue what
they are dealing with at this point.
[Separately, I had a bit of a discussion with a family member at
the dinner table on Easter over the actions of the 15 British
sailors and Marines taken hostage by Iran. I maintain we still
don’t know all the facts, but I’m now convinced they were
indeed lightly armed and perhaps no match for the Iranians had
they chosen to fight….not that I’m saying this is what they
should have done given their murky rules of engagement.
But then we learn the 15 were permitted by Britain’s Ministry of
Defense (MOD) to sell their stories, with the lone female, Faye
Turney making a reported $300,000. Another sailor, who was
getting about half what Faye did, said “I am worth it because I’m
one of two that didn’t crack.” Families of victims killed or
injured termed the MOD’s authorization “inappropriate” and
“undignified.” It also turns out that despite Tony Blair’s denials,
the White House did indeed play a key role in getting an Iranian
diplomat released from custody in Iraq, which in turn helped lead
to Tehran’s “gift to the British people.”]
Iraq: Moqtada al-Sadr had been keeping a low profile as the
surge began early in the year, but now he is urging his militia to
fight back just as a suicide attack inside the Green Zone took the
life of an Iraqi parliament member in a bombing that not only
could have been far worse, but also points out the fragility of the
government overall.
The United States also has its hands full with Turkey and its
designs on Kurdish terrorists using Iraq as a safe haven for
launching attacks on Turkey’s military. Prime Minister Erdogan
is under increasing pressure from his people to fight back and
invade the border areas, while Washington is urging him to back
off. Relations between the U.S. and Turkey are at an all-time
low and threaten to split wide open over this issue. Turkey is in
its rights to go after the Kurds, just as we were in going after al-
Qaeda in Afghanistan following 9/11.
Afghanistan: The violence is picking up as at least 11 NATO
soldiers, including 8 Canadians, died in various attacks this
week. The number of Canadians who have given their lives in
Afghanistan is now 53 and the people are rapidly turning against
the mission. This is one American who notes the Canadian
military’s courage and heroic response.
North Korea: Appeasement, that’s what it is. The U.S. allowed
North Korea to sell arms to the Ethiopian Army because it was
thought Ethiopia could help stabilize Somalia. [Now human
rights groups say Ethiopia is committing atrocities.] And then
the Bush administration gave in on the issue of North Korea and
the disputed $25 million sitting in a Macau bank. As of this
writing, though, the funds still haven’t been transferred, though
the U.S. is saying it is not to blame.
I do give the White House credit for sending Bill Richardson
over to at least talk to the commies, but the fact is North Korea
has not met the deadline, today, for shutting down its nuclear
facility at Yongbyon per the Feb. 13 agreement.
The following isn’t a partisan statement, but why trust President
Bush at all on this issue? Former U.N. ambassador John Bolton,
who has become quite the critic of his former boss, said it’s
nothing more than retreat, “an image of surrender that is going to
be hard to erase.” Returning the money to entities that
committed fraud (as in counterfeiting U.S. currency) “will have a
debilitating effect on bringing sanctions against Iran and other
rogue states. It is a terrible symbol.”
Algeria: In a worrisome development for North Africa as a
whole, an al-Qaeda linked group bombed the prime minister’s
office and a police station, killing 33 at last count. A third bomb
was found before it could go off.
And remember how I said Casablanca was a dangerous place
when I was over there recently? Four suicide bombers died in
one day in the city this week…three blew themselves up (one
perhaps accidentally) and a fourth was shot before he could set
off his bomb belt. Police are frantically looking for up to ten
more; shades of the horrific carnage inflicted on Casablanca in
2003 when 13 blew themselves up and about 40 innocents.
India: The nuclear deal between Delhi and Washington is
teetering on the verge of collapse and this time it’s not the White
House’s fault. India insists on its ability to continue testing its
nuclear weapons when the agreement was supposed to help stop
the spread of nukes in the region, a point further made when
India test-fired a missile yesterday that was capable of carrying a
nuke to Beijing and Shanghai. The administration is also upset
at what it sees as increased cooperation on a number of issues
between Iran and India. This is a huge disappointment to yours
truly, who touted the nuclear technology transfer between our
two nations as a real watershed moment.
Lebanon: The war of words is heating up again. Hizbullah
leader Sheik Nasrallah declared his forces will keep their
weapons (as if there was any doubt) until Lebanon’s army is
capable of defending the country. Walid Jumblatt, the senior
member of the ruling coalition, described Nasrallah as “the
president of the republic of Hizbullah.”
Ukraine: Pro-Russia Prime Minister Yanukovich has reportedly
been paying $millions in bribes to members of parliament to get
them to switch allegiances in his battle with Pro-West President
Yushchenko. This crisis could easily spin out of control as
Yushchenko continues to call for new elections on May 27.
France: A week from Sunday, the first round in France’s
presidential election will take place. Two will then enter a runoff
slated for May 6, but it would appear only Nicolas Sarkozy is a
lock for one of those spots. Sarkozy is also pouncing on the
Algeria bombings, correctly saying that France is the real target
down the road.
Russia: There is a report out that exiled oligarch Boris
Berezovsky is planning a “bloody revolution” to oust Vladimir
Putin. If I were a neighbor of Berezovsky’s in London, I think
I’d move over the weekend, know what I’m sayin’?
Hong Kong: It’s been ten years since Britain handed over the city
to China and by now the people here were supposed to have had
universal suffrage. Instead, on March 25, only 800, mainly
businesspeople with ties to the mainland, voted for chief
executive. China is now saying perhaps by 2017 it will give
Hong Kong residents the right to vote on its leaders, though even
then they would be choosing from a list of candidates
handpicked by Beijing.
So I once again ask my friends in Taiwan. Is this what you
want? If you give into China, as the majority on the island
appears to favor, you will no longer have your freedom. While
some would say, what’s so bad about that? Hong Kong appears
to still be doing pretty well, just understand there is a lot of
tension below the surface.
One sidebar. There is a bit of a controversy in Hong Kong over
the recent sale of fake diamond necklaces to tourists.
Undercover officers broke the case. And, yes, the ‘gems’ proved
to be cubic zirconium. Which is why I am announcing a new
policy for the loved ones; no more jewelry from my travels. I
never had a clue what I was purchasing in the first place.
Random Musings
–I never received more e-mail than I did this week regarding
Don Imus, but I venture to say I’m the only one among our
distinguished group of readers that actually advertised on Imus’
radio program, having done so twice as part of the launch for
StocksandNews.
I paid $6,000 for eight “live reads” the first go ‘round and he did
a good job with the script I had written, pronounced my name
right and I got some good traffic out of it. [At this time I was
also advertising on WCBS-AM, Bloomberg News, and a few
others around the country.]
But about a year later I paid Imus $7,000 for the same eight
spots, I stupidly wasn’t thinking of his growing tie-in to
MSNBC, and he butchered the ads; including mispronouncing
the name when he knew damn well otherwise. In other words,
he couldn’t have been less professional and forever after I really
couldn’t have cared less about the guy.
Oh, sure, I continued to tune in around 7:30 each day on
MSNBC to see if he had John McCain or Tim Russert on, and
I’ve undoubtedly sourced Imus’ program on many an occasion,
but the show wasn’t as funny as it used to be [who wants to listen
to Bo Dietl for 30 minutes straight?] and when he shot himself in
the foot with his incredibly stupid comment about the innocent
athletes on the Rutgers women’s basketball team, I remarked to a
friend that Imus had to be suspended for at least a week. Instead,
he was fired, the victim of a bunch of hypocrites and outright
charlatans.
Will I miss him? Not really. It’s kind of like favorite television
shows. I really still miss “M*A*S*H,” “Seinfeld,” and
“Cheers.” I don’t miss “Everybody Loves Raymond.” There’s a
difference between ‘great’ and mere ‘entertainment.’ Imus was
entertainment.
But of course the national debate that erupted this week ended up
being about far more than Imus. It turned into a debate on the
merits of our two fake reverends, Jesse Jackson and Al Sharpton.
The fact that it was these two more than anyone else who took
down Imus, forcing big advertisers to immediately turn tail, is
despicable.
And so before I took off for Asia on Tuesday, I printed out some
material I wrote long ago on Sharpton in particular for just this
moment.
Back in December 2000, for another link on StocksandNews, I
noted some of the following.
“Right now, Sharpton is going through one of those periods
where the press tries to re-package him, conveniently forgetting
the awful things this man has done.”
For example, Sharpton helped fuel the Crown Heights riots in
Brooklyn back in 1991 that led to the death of a Jewish student.
And then there was the 1995 tragedy over Freddy’s Fashion Mart
in Harlem.
Freddy’s was a landlord-tenant dispute between the Jewish
owner of a clothing store and a black subtenant. Thanks to
Sharpton’s race-baiting, protesters screamed against
“bloodsucking Jews” and far worse.
The protesters threatened to burn the building down when one of
them, Roland Smith, took Sharpton’s words to heart and ran into
the store shouting, “It’s on!”
Smith shot and wounded three whites and a Pakistani (who it was
later surmised he probably mistook for a Jew). Then he set the
building on fire, killing five Hispanics and two blacks (including
a security guard at the store whom protesters had taunted) before
fatally shooting himself.
Then there was the case of Tawana Brawley.
Brawley, a 15-year-old living in Wappinger Falls, New York,
told a tale whereby she claimed she was abducted and raped by a
band of white men practicing IRA tactics. As a grand jury later
concluded, Brawley totally fabricated the story in order to protect
herself from a violent stepfather.
Meanwhile, in one of the saddest cases in the history of the State
of New York, white prosecutor Steven Pagones was accused by
Sharpton and his vile lawyer buddies of the actual kidnapping
and raping of Brawley. Pagones’ life was never the same.
It was a media circus as each day Al Sharpton would say the
most awful things about a totally innocent man…and the local
news outlets didn’t have the sense to keep it off the air.
To regain some of his dignity, Pagones filed a defamation suit
against Sharpton et al, one that lasted for years; years of torment
for Pagones. Finally, he won a $65,000 judgment against
Sharpton that the Reverend appealed. Pagones eventually won
that one but Sharpton never paid up, if I recall correctly. And
even though the whole New York area knew Brawley made the
entire story up, Sharpton never apologized.
But wait, there’s more. Sharpton was acquitted on 1989 charges
of income tax evasion and stealing from charitable donors, but
then pleaded guilty in 1993 to a misdemeanor charge of failing to
file a tax return for 1986. CBS-AM radio later reported that
Sharpton admitted in 1997 that he owed the IRS more than
$100,000 in back taxes.
Back in 2000, many of us were also wondering just how it was
that Al could afford to send his two daughters to a private school
that at the time cost $15,000 a year in tuition?
In a deposition, Sharpton admitted to receiving a salary of
$72,000 from his National Action Network, as well as a $300
expense check twice a month. [He also earns money as a
preacher, though he doesn’t divulge how much, nor can he
remember which churches pay him.] Sharpton then admitted
further tax avoidance. He hadn’t filed income taxes for the prior
two years.
I could write more, like about the 2000 election cycle when
Gore, Hillary and Bill Bradley all made pilgrimages to visit Rev.
Al, but Gore and Hillary (who was running for the senate) tried
to do it in secret. You’ll recall that it was Gore who kowtowed
to Sharpton’s request for a debate at the famous Apollo Theater
in Harlem, with Sharpton getting to ask the first question in front
of a national television audience.
I wrote back in Dec. 2000, “Of course none of the news media
that evening told you that the Apollo is right across the street
from Freddy’s Fashion Mart. Instead, we are told that Sharpton
is a different person now. As he told one reporter, ‘I’ve become
more mature in the sense of being better able to travel my
cause.’” I guess this is why Chris Matthews is so in love with
the guy today.
People don’t change. Al Sharpton hasn’t changed, Jesse Jackson
hasn’t, nor has Imus.
But Al Sharpton as Imus’ hangman? Are we nuts?! Suffice it to
say, when you couple this whole episode with the dropping of
charges in the Duke lacrosse case, race relations have been set
back a decade by the events of the past week. And the silence of
phonies like Harold Ford Jr. makes it all the worse.
My good friend Phil W. observed that the double standard at
work reminds him of the days of Yassir Arafat. We were always
told, this time Arafat will reform and his people will prosper.
For over 30 years we heard that story.
Now we’re told that maybe Sharpton and Jesse Jackson will go
after rap music, but for almost two decades they’ve done
nothing.
It’s a shame it’s come to this, especially on the 60th anniversary
of Jackie Robinson breaking baseball’s color barrier. I imagine
both Robinson and Martin Luther King Jr. are looking down on it
all with total disgust. I also suspect the worm will turn, and that
Sharpton may indeed finally receive his own comeuppance.
–Turning to more mundane subjects, for the 7th consecutive
month, President Bush’s job approval rating in the USA
Today/Gallup survey is below 40%, while in a poll for
Bloomberg News/Los Angeles Times, Rudy Giuliani continues
to lead Republican presidential candidates with 29%. But the
real story is unannounced candidate Fred Thompson taking
second with 15% to John McCain’s 12% and Mitt Romney’s 8%.
When it comes to Romney, last week I wrote it didn’t matter how
much he had raised and the next day George Will commented on
“This Week” that “Money can only take you so far.” I also
called Romney a political lightweight and the next day we
learned about his incomprehensible lying with regards to his
hunting experience…or lack thereof. It’s pretty apparent Mr.
Romney has a problem with the truth and those who continue to
support him after the latest revelations are truly a bunch of idiots.
–Back to the president and his approval rating. Can George
Bush possibly feel that Karl Rove has been a big help these past
few years, particularly in shaping Bush’s legacy? And am I
missing something, or is having a dysfunctional Justice Dept. a
rather dangerous proposition.
–What a state New Jersey is. Now our governor is in a hospital
in critical condition as a result of an auto accident because he
broke the law in failing to wear a seatbelt. Ask me if I feel sorry
for the corrupt jerk.
–Update: I wrote of the captain of The Sea Diamond being
unemployable and then hours after posting learned both he and
his crew were charged with negligence in the sinking of their
cruise ship off Santorini. He faces up to five years in prison,
though many of the passengers have come forward to say he was
a real hero and the reason why no more than two died.
–Flying from Hong Kong to Fuzhou, China, on Thursday, I
couldn’t help but muse as I stared down at a number of rivers
that not one of them is remotely clean, by all accounts. China
may be growing at 10% a year, with growing numbers entering
the middle class, but in the long run it is doomed without a clean
water supply.
I stayed out at the airport in Hong Kong my first two nights
because of my day trip to Fuzhou and then on Friday I
transferred to a hotel on Hong Kong Island. The weather was
good so I immediately headed up the peak to my favorite
restaurant for lunch (this is my third trip here since 2001) and
while there I swear for the first time in nine days that I’ve visited
Hong Kong, cumulatively, for a split second I saw some blue
sky. Then it disappeared.
Hong Kong never changes. It’s very simply the most polluted
developed city in the world, but I also still find it fascinating and
can’t get enough of the harbor.
As for Fuzhou, I was picked up by a driver and interpreter from
the company I was visiting and the interpreter’s name was Dora
Chou [“Dora” because she said I’d never be able to pronounce
her real name]. Dora was delightful and in spending three hours
with her it was a real education.
The one hour drive from Fuzhou to the plant I was visiting was
far more rural than I expected and you see your share of extreme
poverty, as well as more than a few incongruities. Such as a nice
home built amidst rubble. In fact I didn’t see one lawn, just
buildings and rubble, buildings and rubble. People walking to
their homes, climbing over rubble. You’d think they’d get
together as a community and at least push the stuff to the side.
And there were few cars. So indeed there are still regions in
China where it’s taking quite a while for the standard of living to
catch up with that exhibited in the bigger cities.
I also saw this pond with some ducks and thought, that’s
pastoral; until I looked up on the bank and saw thousands of
them. And then another duck farm, and then another, and then
another. “You don’t have bird flu here, do you Dora?” “No, no
bird flu.” “Pray it stays that way.”
My immediate thought, aside from the obvious public health
issue, is that you can really see firsthand how if one sick bird is
uncovered and the government moves in to slaughter the others,
the farmers are doomed. They know nothing else, have no other
skills. It’s such a fragile existence.
I did ask Dora if she had any brothers and sisters and it turns out
she has one of each. But what of the one child policy in China? I
asked. She said her father just loved kids and was willing to pay
the hefty fine. Yes, that’s how it works. If you can afford it, you
can basically have as many children as you want.
Then Dora asked me a question. “Why is your hair all silver?”
You’ve gotta love it.
More next week. For now I’m off to the race track, and then on
Sunday, Macau. Maybe I’ll find out if the North Koreans were
really able to access the $25 million that was stuck there.
—
Pray for the men and women of our armed forces.
God bless America.
—
Gold closed at $689
Oil, $63.63
Returns for the week 4/9-4/13
Dow Jones +0.4% [12612]
S&P 500 +0.6% [1452]
S&P MidCap +0.7%
Russell 2000 +0.7%
Nasdaq +0.8% [2491]
Returns for the period 1/1/07-4/13/07
Dow Jones +1.2%
S&P 500 +2.4%
S&P MidCap +7.9%
Russell 2000 +4.0%
Nasdaq +3.2%
Bulls 49.5
Bears 27.5 [Source: Chartcraft / Investors Intelligence]
Have a great week. I appreciate your support.
Back to my normal posting schedule next time.
Brian Trumbore
