Wall Street
The other day conservative commentator Charles Krauthammer, who I’ve long admired and quoted extensively in this space, wrote in his Washington Post opinion piece that it was wrong to say the government and our political process was dysfunctional, rather it was a failure in leadership, citing Ronald Reagan and what he accomplished despite a divided Congress, and Bill Clinton, and so on, the point being that our current problems are a result of Barack Obama’s failure in leadership, not the process.
“Leave it to Mickey Kaus, a principled liberal who supports health-care reform, to debunk these structural excuses: ‘Lots of intellectual effort now seems to be going into explaining Obama’s (possible/likely/impending) health care failure as the inevitable product of larger historic and constitutional forces…But in this case there’s a simpler explanation: Barack Obama’s job was to sell a health care reform plan to American voters. He failed.’
“He failed because the utter implausibility of its central promise – expanded coverage at lower cost – led voters to conclude that it would lead ultimately to more government, more taxes and more debt. More broadly, the Democrats failed because, thinking the economic emergency would give them the political mandate and legislative window, they tried to impose a left-wing agenda on a center-right country. The people said no, expressing themselves first in spontaneous demonstrations, then in public opinion polls, then in elections – Virginia, New Jersey and, most emphatically, Massachusetts.
“That’s not a structural defect. That’s a textbook demonstration of popular will expressing itself – despite the special interests – through the existing structures. In other words, the system worked.”
OK, that’s all well and good. But Mr. Krauthammer is wrong in believing this time is not different, because it is. It’s very different. And it’s not just confined to Washington, it’s about many of our individual states, let alone much of Europe. It’s about an era of profligacy that, in the case of the United States, flourished under both political parties, while in Europe, the gimme gimme gimme culture first really flourished as leaders ignored rather important long-term issues such as demographics and how exploding entitlements would be paid for.
And while today’s problems cry out for leadership, what I see that is different is an unwillingness on the part of the people, whether here or overseas, to sacrifice. And it’s today, not 10 or 20 years from now, when the sacrifices have to be made. Any political leader bringing up the thought of reduced benefits, for example, would be voted out of office in a heartbeat (if not stoned). It’s why I have a real problem with the Tea Party folks. I’ve read their 17-point platform. Oh, sure, it talks about balancing the budget and reducing spending, but nothing on entitlements. It’s a bunch of feel-good malarkey.
Since day one of writing this column, going back 11 years, and before that with PIMCO, I have talked about the deficit situation in terms of laying out the facts, but also saying I wasn’t going to lose any sleep over them in terms of their impact on the equity markets and I was right. But you’ve undoubtedly noticed a shift in my tone the past few weeks and I’m here to formally say, now they matter in terms of market psyche. But what’s worrisome is I see no leadership on the issue, though I will give the president’s new fiscal commission a fair shot. He selected some good people for it but any recommendations they make, which won’t be put forth until after the November mid-term election, still must be approved by Congress, which is where the Senate failed miserably in not approving a panel with teeth a few weeks back.
We The People don’t have the guts to deal with pain, but at the same time we do want to inflict pain on some deserving a ton of it, the bankers, specifically the likes of Goldman Sachs, or bank executives, such as in Ireland, who looted their institutions while encouraging irresponsible lending that did nothing but fill their pockets.
For instance, there was a poll in Ireland that said “91 percent want criminal prosecutions pursued against those in the banking sector found to have been in breach of the law, precisely the same finding as a year ago when the same question was asked in the last such poll.” [Jody Corcoran / Irish Independent]
But no real action has been taken with the crooks in Ireland, nor has anyone gone to jail in the U.S. It’s tough to convince a people to sacrifice when they see time and time again others getting away with gaming the system.
The other day, PBS’ “Frontline” re-ran a segment, “The Warning,” from last fall; a story I talked about extensively, that of former CFTC chairwoman Brooksley Born and her fight to get the derivatives market regulated in the late 1990s. Born, you’ll recall, was beaten back by entrenched interests in Congress, as well as the troika of Alan Greenspan, Robert Rubin and henchman Larry Summers. I didn’t think I could get upset at the same level all over again but I did. If you haven’t seen it, I’m giving you a homework assignment. Go to pbs.org and watch the video of the show.
Ah yes, derivatives. We’ve known of these WMD for a long time and yet in the example of Greece we’re learning again of their destructive power. We’re also learning anew of how Goldman Sachs was behind the efforts of the Greek government, in this instance, to hide its deficit issue.
Last Sunday, the New York Times’ Louise Story, Landon Thomas Jr. and Nelson D. Schwartz detailed how Goldman’s bankers, “led by (president) Gary D. Cohn, held out a financing instrument that would have pushed debt from Greece’s health care system far into the future, much as when strapped homeowners take out second mortgages to pay off their credit cards.” This was just last November, mere months before Greece rocked the financial world.
You see, back in 2001, right after Greece was admitted to Europe’s monetary union, “Goldman helped the government quietly borrow billions, people familiar with the transaction said. That deal, hidden from public view because it was treated as a currency trade rather than a loan, helped Athens to meet Europe’s deficit rules while continuing to spend beyond its means.”
While Greece didn’t pursue the November proposal, they sure took advantage of Goldman’s brain power and ability to manipulate the numbers, and rules, in 2001, and of course it was “financial derivatives that played a role in the run-up of Greek debt. Instruments developed by Goldman Sachs, JPMorgan Chase and a wide range of other banks enabled politicians to mask additional borrowing in Greece, Italy and possibly elsewhere.”
In a nutshell, it was financial engineering at its best and in the end, not only did Greece pay Goldman $300 million in fees for the 2001 transaction alone, but Goldman and its crooked banking brethren pawned off all manner of derivatives products on unsuspecting Italian municipalities, too; this last bit as reported by the Wall Street Journal. Italian officials are on the hook for $48 billion in derivatives contracts that will impact their towns for the next 20-30 years. Of course few, if any, understood what they were getting into. They just listened to the smart, slicked back bankers from Goldman, because, after all, these guys knew everything. They had to be right, and, who cares what they were siphoning off for themselves, their expertise was worth it.
So it’s no wonder that as Greece and some of the other PIIGS (Italy, Ireland, Portugal, Spain, and throw in Britain) suffer under irresponsible behavior that a hunt is on for the bankers most responsible for a large part of the chicanery.
German Chancellor Angela Merkel, under immense political pressure not to help the Greeks, said during a speech this week, “It would be a disgrace if it turned out to be true that banks that already pushed us to the edge of the abyss were also party to falsifying Greek statistics.” Greek Prime Minister George Papandreou, who it needs to be said appears to have his heart in the right place, though he’s severely hamstrung, has set up a parliamentary commission to investigate the previous administration and its handling of the public finances, 2004 to 2009. The European Commission has also demanded the facts on Greece and its relationship with Goldman. I have CNBC on all day during market hours and each time I see Jim Cramer, or one of the other shills at the network, defend Goldman Sachs I just want to scream. You cannot in any way defend them!
But back to the euro crisis and Greece. The EU has given Papandreou until March 16 to prove he can cut spending before the EU will offer any real help, so imagine the pressure he is under. He has to slash wages, and the people won’t allow it beyond a token amount. It was great when some public sector employees got outlandish 40% raises in two years, but don’t ask them to give any of it back. The attitude of the Germans, on the other hand, is why should we come to the rescue of a country whose officials “tricked, cheated and lived the high life – (to the point where) they are almost bankrupt,” as the mass-circulation Bild Zeitung editorialized. As for Goldman Sachs, North Carolina law professor Thomas Hazen pretty well summed it up for Bloomberg.
They could face legal liability “if it could be established that they were knowingly hiding risk, and therefore knew or had reason to know that the bond disclosure documents were misleading. But that would be a tough hill to climb, in terms of burden of proof. There’d have to be some sort of smoking-gun memo.”
There seldom is. Whether it’s Ireland, Greece, or the United States, these guys get off. There are no ethics. Just bad people who one can only hope feel a lot of pain in the afterworld. All the more reason to pray there really is one, friends.
One last bit on derivatives. After all the lessons we are supposed to have learned, it seems we are no closer than before to having a market some peg at $600 trillion in notional value being regulated. A former Goldman Sachs partner, Gary Gensler, is Obama’s CFTC (Commodity Futures Trading Commission) chairman and there is some hope. He does get it. The banks’ “interests are not necessarily aligned with the American public’s interests,” he told Bloomberg BusinessWeek in a recent interview. Light a candle that he can stay strong and isn’t steamrollered by the banking lobby, the members of which are the last people on earth you’d want to share a beer with, to really break it down to the ultimate test.
So, yes, we find ourselves, along with much of the developed world, in debt up to our eyeballs, either through government behavior or of a personal nature. In Britain, they just reported their first-ever budget deficit for the month of January since they started keeping records on this. [Ebenezer Scrooge never ran a deficit…but I digress…] Tax revenues plunged 11.8% from year earlier levels. In the United States, revenues in January were down 10.4%. In fact all over the U.S., as well as most of Europe, tax revenues are down a like amount and you’ve seen the severe consequences in states from California to New York and New Jersey where overspending at the state level, when combined with plummeting revenues, is leading economies into the abyss. The other day, New Jersey’s new governor, Republican Chris Christie, appeared on CNBC to talk about the dire shape of the finances and he brought up a huge issue facing all of America, and, again, much of Europe. Soaring pension costs. In the case of the Garden State, public employees can retire at 49, having put in just $124,000 into the pension system, yet can proceed to take out $3.8 million, including $500,000 in health benefits. This is where the real revolt is building across our land. Those of us who pay ever higher taxes at the state and local level, or higher transportation fees, to cite another flashpoint, are paying for a cushy retirement for some state or municipal worker who just doesn’t deserve it. Of course that’s not an entirely fair statement I just made, seeing as how there are good people in all fields, but that’s the direction the tenor of debate is headed rapidly.
“Finding precisely the right metaphor, Gov. Christie said, ‘The days of Alice in Wonderland budgeting in Trenton end.’
“That’s been said before…(but) it looks different this time. In hopelessly profligate New York, for instance, a coalition of diverse business interests formed recently after concluding that the state’s politicians and public unions are willing to wreck what’s left of the state’s long-term economic prospects. Better late than never.
“We’ve been grinding toward this moment since 1932. It has always been a question of political physics just how high government could go in the U.S. before it arched over and down. Now we have Washington, California, New York, New Jersey and others all arriving at the same time of reckoning. And all for the same reason, public spending by the public sector – its politicians, its unions, its massive schools of pilot fish.
“The discomforts of the tea parties and the rest of the electorate are obviously more complex than the details of federal or state budget accounts. But the 80-year-old blob knows – and has proven – that it cannot be replaced by 50 varieties of political anxiety….
“You need one big club to beat the blob into a size appropriate for what we still call the United States. Barack Obama’s first year, with California and New York, have handed that club to the voters and their candidates: It’s the spending, America.”
Where I disagree with Mr. Henninger is in his inference we can do something about it.
Lastly, a few words on real estate. Another item I have been consistent on is the notion that the plight of the commercial real estate (CRE) sector will in no way have the same impact that the bursting of the housing bubble had and on this I have been right as well. Once again this past week saw a multitude of stories on the commercial end and how half of CRE mortgages will be underwater by 2011, these rolling over every five years on average vs. a typical home mortgage of 30 years.
I do not deny there are issues, but it’s the whole concept of the wealth effect and, to repeat myself for the umpteenth time, you and I don’t talk about the plight of the mall operator when we’re at a cocktail party. We talk about our plunging or stagnating home values and losing equity on what for most is their biggest investment. The two couldn’t be more different.
But I have also said where the problems in CRE come in is with the community banks that hold so many of these mortgages. Not only will many go under (though thanks to the FDIC you shouldn’t lose any sleep over this), but those who survive will have less money to lend out to your small business so this helps hold the pace of any economic recovery down.
As for residential, I watched President Obama’s nauseating speech in Las Vegas Friday afternoon, sickening because of the hypocrisy in him praising Vegas when all he’s done is slam those of us who like to party or hold a meeting there. Despite a slight improvement in home values here, 81.3% remain underwater! In Phoenix it’s still 61.5%. True, nationally, Zillow.com says those with negative equity have ticked down to 21.4% in the fourth quarter, but foreclosures will continue to pressure prices, and thus impede growth, for the foreseeable future. Want another example? Home prices in the six-county Southern California area were up 8.6% in January from year ago levels…good…but down 6.1% from December…not good.
My bottom line to all the above, including the debt issues in Europe? After we get through the current inventory build, and fake GDP growth, we’ll peter out and have a weak second half, if not a double dip, as Iran works its way back into the equation in a huge way. I also maintain stocks will decline 6% to 12% in 2010.
Street Bytes
–Stocks rallied for a second consecutive week, with the major averages at their best levels since the week of Jan. 15, up a solid 3% across the board for the four trading days. Earnings from the likes of Deere, Hewlett-Packard and Devon Energy came in better than expected, though Wal-Mart’s, which beat on the bottom line but disappointed on the top, were a bit of a shocker, seeing as how Wal-Mart doesn’t give interim guidance anymore or release monthly same store sales figures. Sales were actually down 1.6% for the period including the Christmas holidays and the company guided lower for the current quarter. So what does this say about the economy? Nothing good, said the Grinch.
The market finished up, though, even as the Federal Reserve Board raised the discount rate, that which is charged to banks for direct loans, by a quarter point to 0.75% in a sign that it is seeking to finally normalize the Fed’s lending facilities, though this will have no impact on households and businesses in the very short term. The dollar jumped anew, especially against the beleaguered euro, while Treasury rates, 2 to 30 years out, continued their steady climb higher with the key 10-year now up to 3.78%. Fed Chairman Ben Bernanke testifies before Congress next week and I’ll comment further at that time. For now, with a still awful labor market and little sign of real progress on that front, let alone a housing sector that has basically flat-lined, the Fed is not likely to raise the funds rate, that which really impacts us, for at least another six months.
And just a note on Japan as well as China. Japan reported GDP growth of 4.6% for its fourth quarter, higher than expected, but deflation persists as wages have declined 19 consecutive months. Japan’s future does not look good, especially as its government stimulus winds down.
However, by growing 4.6%, Japan delayed for 90 days the inevitable; China passing it for second in terms of world’s largest economies. The U.S. stands at roughly $14.3 trillion, Japan’s GDP is at $5.1 trillion, and China’s is $4.9 trillion. But that sound you hear is one of China’s high-speed trains approaching, if you live in Tokyo.
Speaking of China, we learned that their holdings of U.S. Treasuries fell by $34 billion in December to $755.4 billion. No need to panic. It’s not a wholesale dumping of Uncle Sam just yet. Plus China buys anonymously through banks in Europe and elsewhere so its position may actually be larger. But because of the China sales, Japan is officially back on top as the number one holder of Treasury paper with $768.8 billion worth
Ex-food and energy, both producer prices for January, up 0.3%, and consumer prices, down 0.1%, continue to show inflation is not an issue. You show me a real turnaround in the labor market, including solid wage gains, and couple that with a housing market on the rebound, not what we have today, and then maybe we can talk about inflation. But don’t waste my time beforehand.
[The Fed, incidentally, in its latest minutes from the last FOMC meeting, said the unemployment rate may only fall to 8.2% to 8.5% by the end of 2011. 5% is thought to be full employment.]
–Expect major fireworks on Feb. 24 when Toyota Motor Corp. President Akio Toyoda testifies before a congressional hearing. Toyoda initially declined the invitation but now realizes the company’s PR issues are so severe, he better show up as Toyota is now examining the Corolla, the world’s top-selling car, for steering issues…which is kind of important unless all your drives are in a straight line, including straight into a parking spot. And as Japanese Foreign Minister Okada said, it’s not just about Toyota, but it’s “an issue for Japan as a whole. There may be an effect on trust in Japanese technology and products.”
I’m thinking I may launch a lawsuit of my own now for thinking those first Godzilla movie sets were real. Of course I was only 8 years old at the time so how was I to know they were using Erector Sets and the director’s bath tub, though I suspected this was the case? The deception has been in for decades.
[On a more serious note, 37 fatalities have now been linked to runaway Toyotas, up from the original figure of 19, while 10 million vehicles worldwide (8 million in the U.S.) have been recalled.]
–Former Treasury Secretary Henry Paulson Jr. weighed in on reforming the financial system and the current legislative tussle in an op-ed for the New York Times, calling for the creation of a “systemic risk regulator to monitor the stability of markets and to restrain or end any activity at any financial firm that threatens the broader market. Second, the government must have resolution authority to impose an orderly liquidation on any failing financial institution to minimize its impact on the rest of the system.”
That’s all well and good, but as a Times piece by Louis Uchitelle noted, many of the Street’s elders want regulation to go much further. To wit:
John Bogle, founder of Vanguard Group: “I am a believer that the system has gone badly awry and needs massive reform.”
Nicholas Brady, founder of Dillon Read and former treasury secretary: “If you are a commercial bank, and you wish the government to guarantee your deposits and bail you out if necessary, then you can’t be involved in speculative activity,” referring to the Volcker Rule, which would prohibit a bank from taking deposits and then using them to buy and sell for their own account. Brady would tighten it further, meaning a return to Glass-Steagall and a prohibition on any sort of trading activity by banks, which is the opinion of former Citigroup co-chairman John S. Reed. “I can be convinced that we should move back in the direction of Glass-Steagall.”
“Mr. Reed…wonders if a trading operation should even exist under the same roof as a standard commercial bank. The traders make more in salary and bonuses than the bank employees, and there are frictions. ‘The bank people say ‘if the capital market guys take big risks, why can’t we do so too and earn the same bucks?’’ Mr. Reed said. ‘They start trying to do things that make them look good, like making risky commercial loans and driving for volume.’”
Legendary trader George Soros wants to impose higher capital requirements to curtail risk-taking though says giants like Goldman Sachs have simply grown too big to fail and there is no “orderly liquidation” that is conceivable for them, thus restricting their activities through the imposition of capital limits is the only way to go. All of the elders would limit the derivatives market in a big way.
–I agree on the surface with President Obama’s loan guarantee program to build the first nuclear power plants in the United States in 30 years, two to be built by Southern Co. in Burke, Ga. But Southern Co. can’t begin construction until approval from the Nuclear Regulatory Commission and that isn’t expected until late 2011 or early 2012. The administration has actually earmarked funds and/or guarantees for six or seven new plants. 104 are currently in operation in 31 states, providing about 20% of the nation’s electricity.
Environmentalists, however, complain there is still no national policy on dealing with the waste, as Obama cuts off funding to Yucca Mountain and admits he has no alternative. Republicans, meanwhile, are concerned how the nuclear policy will impact potential cap-and-trade legislation, which I personally believe is dead.
–China isn’t all about ripping off our products and making them cheaper. It does have some innovations of its own, which should be the most worrisome development for those of us who care about such things. A perfect example was an announcement this week by GE, which is negotiating with China’s Railway Ministry to use China’s technology to build a high-speed rail network across America. Said the president of GE transportation, Tim Schweikert:
“We’re going to need to bring high-speed rail technology from outside because there is no indigenous high-speed rail technology in the U.S. China is the world leader in high-speed rail. We plan to leverage Chinese-developed technology.” [South China Morning Post]
–Schlumberger is looking to acquire Smith International in a deal that would create an industry giant in the oil services sector with revenues double that of its nearest rival. An earlier announced deal between Baker Hughes and BJ Services has yet to be formally approved by U.S. authorities. Oil, incidentally, shot back to $80 on fears there could be imminent action over Iran’s nuclear program.
–Former Bank of America Corp. CEO Ken Lewis admitted in an October 2009 deposition to the SEC that he was aware of Merrill Lynch’s losses before a shareholder vote in December 2008. Lewis settled with the SEC, which is being reviewed in U.S. District Court, but New York Attorney General Andrew Cuomo wants to pursue Lewis for securities fraud and this new disclosure certainly bolsters his case.
–Barron’s has an annual survey of the most respected, or disrespected, of the world’s 100 largest companies (by market cap) and the top five, as selected by money managers and graded on issues such as management, ethics, business strategy, and product innovation are: 1. Apple 2. Johnson & Johnson 3. Procter & Gamble 4. IBM 5. Berkshire Hathaway. The bottom five are: 96. UBS 97. Sberbank Rossia (Russia) 98. Rosneft (Russia) 99. Gazprom (Russia) 100. Citigroup. Nice company Citi is keeping, eh?
–I was reading a piece on the BRIC nations (Brazil, Russia, India and China) where money manager Mark Mobius was more bullish on Brazil’s prospects over China’s because Brazil had so many natural resources, whereas China has to acquire them, and then I read a piece in Defense News that noted China controls the production of 97% of “rare earth minerals.” It’s become a serious issue for American companies and the Defense Department.
“Rare earth minerals make up tiny but vital parts of advanced arms, as well as many consumer products such as automobiles and cell phones….
“Beijing is expected to further constrict and raise the price of exports…” and so on. Thus some are calling on the U.S. to develop strategic reserves much as we do with oil.
–Speaking of Brazil and China, I continue to hold my Brazilian airliner in my own portfolio, and may add to it as a hedge against me being wrong on the direction of the global economy, while I did add to my China position this week. This stock appears to be dead in the water but I reiterate this is a long-term hold…another two years if necessary…though I think investors will learn a ton by mid-May and release of the first quarter results. I’m not so sure too much will be gleaned from the yearend report that will probably be issued in another ten days.
–Dell’s net income fell 6% last quarter even as there were signs business spending was recovering, a la Hewlett-Packard’s announcement, but its profit margin slipped and this disappointing stock took another header on that news.
–As you know, after 17 or so trips to Ireland since 1989, I’m pretty familiar with the economy there and wrote in this space of the developing bubble on the Emerald Isle long before the natives realized what was going on, but I was staggered by some of the statistics in a Bloomberg BusinessWeek piece that addressed the plight of college graduates there today. Looking at a senior at Trinity College in Dublin, only two of his 100 classmates in the engineering school have even had job interviews. Just two of the 100 in the class ahead of him are employed. So emigration is the only option.
I’ve seen it all in Ireland. When my buddies and I started heading over for the golf, unemployment was around 15% (it peaked at 18%), but then the boom began (owing to prudent tax policies) and kids started to stay after college as unemployment bottomed at 4.4% just two years ago.
But it’s not as if many of the young people can just leave. Those who purchased a home (with heavy leverage, if not no money down) say in 2004-2006, have seen their home values halved. There is zero savings…it’s a disaster.
–Funny bit in the Irish Independent on how British tourists are now turned off by Spain because it isn’t “foreign enough.” There are too many English-themed pubs, for example. Of course it was the British invasion there that played a huge role in Spain’s real estate bubble, as also documented in this space. Bookings to the United States by the Brits, however, are up.
–On a related item, I’m going to Ireland for a few days in August and in booking the flight the other day, I commented to my golf buddy that I couldn’t believe how many seats were available. Normally, even though it’s seven months out, the flights fill up early. So that’s as good an economic indicator as you’ll find. I also saw where the number of airline passengers traveling between the UK and Ireland plummeted 17% in January vs. a year ago.
–The Obama administration’s reeling climate change agenda was dealt a major blow as British Petroleum, ConocoPhillips, and Caterpillar have pulled out of the leading business group lobbying for curbs on U.S. greenhouse gas emissions. Instead, these three will push for policies that benefit them, individually, as opposed to the greater whole.
–Fascinating piece by Greg David of Crain’s New York Business. In looking at JPMorgan Chase CEO Jamie Dimon’s $16-$17 million bonus [depending on the current valuation] paid entirely in restricted stock, “If the bonus had been paid in cash, all of it would have been subject to the recently increased higher tax rate for New Yorkers making more than $500,000: 8.97%. It would also have been hit by the highest New York City rate: 3.64% for any amount over $500,000.
“For simplicity, call the combined state and local income rate 13%. Tax due on a cash bonus: a little more than $2 million. Tax due on the restricted stock bonus? Nothing for years, and then only when it is sold.
“Now Mayor Michael Bloomberg’s budget plan says that cuts in the state budget will cost the city $1.3 billion and, if enacted, will force him to lay off 17,500 city workers. So the mayor is saying each city job required $74,300 in revenue.
“The bottom line: The taxes on Mr. Dimon’s bonus would have paid the cost next year of 28 workers. They are likely to lose their jobs instead.”
As Greg David adds, there is also the growing concern at City Hall that the percent of Street revenues going towards bonuses will decline significantly in coming years as well.
–I have to start paying more attention to Merck, which reported revenue this week that exceeded expectations for the fourth quarter, including the impact of its completed merger with Schering-Plough. I now live directly across from one of their major facilities. Like I could stroll across the street and get the scoop from the smokers. Speaking of which, it just has to be said. If you take 3 smoking breaks a day, for 15 minutes each, do you stay in the office an extra 45 minutes? I didn’t think so.
–After four consecutive months of outflows, investors put a net $2.7 billion into U.S. stock funds in January, as well as $8.1 billion into international stock funds, the most for the latter since December 2007. This isn’t necessarily a good sign if you’re a contrarian, though trends can remain in place for awhile before they’re challenged.
–Almost 1 in 5 Americans, 57 million, contracted H1N1 since April, which is kind of a shocker. According to the Centers for Disease Control and Prevention, about 11,700 died with nearly 260,000 hospitalized. Adults age 18 to 64 accounted for 76% of the deaths. We experienced two waves in this country and as I noted last week, Australia is expecting another soon Down Under but officials in the U.S. aren’t sure if the flu hasn’t already run its course here.
–Smartphones are under a growing threat from cyber-criminals. The chief research officer at
F-Secure, which makes anti-virus software, said, “Tomorrow we could see a worm on phones which would go around the world in five minutes.” But so far F-Secure has detected only 430 mobile worms vs. millions of computer viruses.
–Note to Chris C., wave-power fan. Did you see Oregon has approved construction of the nation’s first commercial wave-energy farm? It is planned to supply energy to about 400 homes.
–Ooh baby. Whenever I see a Cinnabon in an airport, as enticing as they look I have to admit I never go for one because they’re such a mess to eat. But now, Cinnabon is introducing a product line of cupcakes! “The 24-Carrot Cake, the Vanilla Bliss, the Cinnacake Classic and the Chocolate Passion.” Expect the chain’s sales to soar. I might have to carry an extra $100 from here on.
–I have another piece on my “Wall Street History” link on our digital nation and multitasking that will scare the hell out of you. Check it out, especially if you’re a parent of school age kids.
–Frank J. Zamboni & Co. is frantically trying to prevent a backlash after reports from Vancouver suggested it was their machines that were responsible for the speedskating rink fiasco the other night where the ice-cleaning machines leaked and forced a huge delay that impacted one key event. The offending machines were made by rival Resurfice Corp. of Canada, not Zamboni, though the Zamboni name has become so generic some, such as the New York Times, reported the delays were due to a broken “Zamboni.” A Zamboni was flown in by officials to be on hand should the Resurfice machines have ongoing problems. For its part, Resurfice blamed it on an “electrical malfunction,” which gives us a Toyota angle…perhaps.
–I think I’ve now seen it all when it comes to our lazy society…a new product called the Windshield Wonder for washing the inside of car windows. Then again, if I call now I get a second one free! [Just gotta pay shipping and processing.]
–Fox Business Network hired away Charlie Gasparino from CNBC. Carry on….
Foreign Affairs
Iran: This was a week where Secretary of State Hillary Clinton traveled to the Middle East and talked of Iran becoming a “military dictatorship” [I posted some of her remarks without comment on my “Hot Spots” link], while the UN’s International Atomic Energy Agency finally admitted for the first time that it was concerned Iran may be working on building nuclear warheads, citing Iran’s refusal to cooperate with the IAEA.
“(In) the absence of a credible threat of the use of U.S. military force – the Administration seems to be gambling its Iran policy on a set of assumptions that look increasingly wishful.
“One of these assumptions is that there may still be a ‘grand bargain’ to be struck with the Iranian leadership, notwithstanding its refusals to do so last year amid President Obama’s overtures. The Administration also allowed itself to imagine that Iran’s protest movement would force the regime to take a more conciliatory nuclear line. It seems to have done the opposite.
“Another assumption is that Iran has encountered serious technical difficulties in its nuclear program, out of some combination of incompetence and perhaps sabotage. We certainly hope that’s true. But the driving fact is that Iran seems to have repeatedly surmounted these obstacles over the years, and last year it surprised U.N. inspectors by producing more low-enriched uranium than anticipated. Enrichment only becomes easier as it moves to higher states of purity. And yesterday, the nuclear agency said it is worried that Iran may already be working on a nuclear warhead.
“Then there is the whispered assumption that a nuclear Iran would be ‘containable.’ But leaving aside the view that a religiously fanatic regime can never safely be trusted with a bomb, a nuclear Iran would open the Pandora’s box of nuclear proliferation in Saudi Arabia, Egypt and Turkey. For an Administration that has made nuclear nonproliferation a centerpiece of its agenda, allowing Iran to go nuclear would seem an odd way to advance that goal….
“(The) option of a military strike will have to be put squarely on the table. Sanctions have little chance of working unless they are backed by a credible military threat, and in any case Israel is more likely to act if it concludes that the U.S. won’t. The risks of military action are obvious, but the danger to the world from a nuclear Iran is far worse.”
For his part, Israeli Prime Minister Benjamin Netanyahu went to Moscow and, among other things, asked President Medvedev and Prime Minister Putin to enact harsh sanctions on Iran that specifically target Iran’s energy sector, including a banning of oil exports and an embargo on the import of refined petroleum products.
“If this is done then it can, perhaps, have an influence [on the Iranians],” Netanyahu said in Moscow. “I doubt that anything else would work.” Netanyahu, as you’d expect, denied Israel was preparing for war with Iran, though he took the opportunity to remind his Russian hosts that Iran’s long-range ballistic missile program wasn’t exactly needed for medical isotopes. Of course when it comes to getting cooperation from the Russians, one must also consider that the week before the Israeli prime minister’s visit, the Kremlin hosted Hamas leader Khaled Mashal.
But on a different matter, just last week I said Israel’s “vaunted intelligence” was overrated and then right after we learned further details on the botched Jan. 20 operation to take out a top Hamas military chief in a hotel room in Dubai by Mossad, as agents attempted to make it look like a heart attack but an autopsy showed the man was poisoned. That was the story in the days after. Now the assassination has exploded in Israel’s face as it appears up to 18 individuals were involved in the mission, at least 11 of whom have been identified on hotel surveillance videos and their photos splashed around the world. The Dubai chief of police has called for the arrest of Meir Dagan, the head of Mossad.
But what makes it a terrible PR fiasco for Israel is the fact they used fake British, Irish, German and French passports in a case of outright identity theft. [Mossad may have copied the passports of Israelis holding dual citizenship while on a business trip, for example, with “maids” looking for suitable documents.] Not only is there an outcry in the nations involved, but in Israel as well where Mossad is being called careless and amateurish. It obviously also reflects poorly on Prime Minister Netanyahu. As one commentator in Israel, Gideon Levy, put it, “We have long forgotten that Mossad is supposed to be an intelligence-gathering organization, not one that sows death, and that a lawful state does not operate hit squads.”
“Israel is displaying a dangerous and false self-confidence. Now they have been caught again, and it will have effects. They have exposed their allies. With a record of apparently false British, Irish and French passports, now all those nations’ passport holders will become suspicious.
“The killing in Dubai is adding to a rapidly thickening file of Israel’s self-satisfied flouting of international law. To be sure, this file makes ideal propaganda for Islamic fundamentalists of every stripe, but these hubristic black acts create an ever-expanding range of consequences that work against the interests of those who want peace in this region. Every instance of Israeli hubris helps break down support for the peace process; it harms the positions of Arabs who want peace.”
The spy fiasco also changes the timetable for any attack on Iran’s Natanz nuclear facility in my estimation. Israel first needs to let the uproar subside. In addition, should the UN Security Council approve strict sanctions on Iran’s energy sector, then Netanyahu must give these a chance to work as well, seeing as he himself pushed for them. As of this writing, Russia appears as if it will go along, while Israel is sending a delegation to China to try and wrest their support. I’ll have far more on the details next time.
Lebanon: Arab League chief Amr Moussa said on Thursday that Arab countries would stand behind Lebanon should it be attacked by Israel. “They [Israel] will not get away with it easily. We learned the lesson of 2006, and the Arab position is to stand by Lebanon.” Moussa didn’t specify what he meant by either 2006 or what kind of support would be provided Lebanon.
And back to the issue of Iran’s nuclear program, recall that Lebanon is currently the Arab representative on the UN Security Council. This is a huge deal. Here’s why, as noted in the Daily Star by Editor Michael Young:
“If Lebanon votes in favor of a sanctions resolution, it will incur the wrath of Hizbullah; if it votes against a resolution, it risks provoking the ire of Arab states who want to see Iran contained, above all Saudi Arabia. And if Lebanon announces beforehand that it will abstain, the decision, if poorly promoted diplomatically, might provoke criticism that it is being wishy-washy, while the permanent Security Council members will be angry not to have the sole Arab representative supporting them.”
Mr. Young says Lebanon’s only choice is to abstain, but what Lebanon really wants is for China to refuse to approve sanctions and thus derail a vote, not that this is right.
As for the Saudis, Sec. of State Clinton sat down with Foreign Minister Prince Saud al-Faisal for four hours, double what was expected, with Faisal warning that sanctions were insufficient. “We need an immediate resolution,” he said. The White House has been hoping Saudi pressure on China would bring them on board the sanctions train, but the Saudis said that wasn’t necessary. Prince Saud, though, also said:
“Sanctions are a long-term solution but…we see the issue in the shorter term because we are closer to the threat. If we want security for the region, it requires an Iran at peace and happy with themselves.”
This was code for, ‘Bomb away, understanding that for appearances and domestic consumption we may have to complain about it afterward. Just be quick.’
Pakistan: While it’s easy to say the capture of Taliban military leader Mullah Baradar is a big breakthrough in cooperation between Pakistan and the U.S., it’s also important to stand back and look at the big picture, including Afghanistan. For example, we were told that upon his capture, Baradar was singing like a bird. This seems incomprehensible. But at the same time, the drone attacks continue at a seemingly accelerated pace. What does the capture say about the direction of Pakistan’s government? Is it really going to be become a true ally of the United States after Washington has pumped $12 billion in aid into the country? What of Pakistan’s intentions in Afghanistan? Similar to Iran’s in Iraq, Pakistan wants a say and Baradar’s capture may hurt Afghan President Karzai’s attempts at reconciliation with the Taliban. Karzai has a plethora of shortcomings, but Pakistan’s leader is a criminal of the highest order and the country, much like Iran and its Revolutionary Guard, is run in part by the ISI, the intelligence apparatus that definitely has Islamic extremists in its ranks. So there are a ton of questions, but like in virtually all such cases actions speak loudly and hopefully the Baradar capture is but the start of rolling up the Taliban.
[On a separate issue, nine people were killed in an attack in India that was then blamed on Pakistan, the biggest strike in the country since 2008’s Mumbai attack. But the ruling Congress Party said it was unfair to “jump to conclusions” and that talks between India and Pakistan slated for Feb. 25 would go on.]
Afghanistan: Through Thursday, 11 NATO forces had been killed in the attack on Marjah, including six Americans and two Brits.
[PBS’ “Frontline” is airing a documentary on Tuesday, “Behind Taliban Lines,” that the Wall Street Journal’s Dorothy Rabinowitz describes as “uniquely chilling.” This is your second homework assignment. I’m getting tougher. No more slacking off.]
Iraq: The critical parliamentary election is March 7 as the main parties jockey for position. Leading Shia cleric Ayatollah Sistani called for a massive turnout, though he withheld his endorsement of any one party. But as noted above, it’s Iran that has been clearly interfering in the election to promote the Shia factions.
China: The government is ticked at President Obama for meeting with the Dalai Lama, but this is one tiff that isn’t serious. Beijing gets mad at everyone who sees him and then moves on. My only thought over the years is why waste time with the guy. I realize it’s not the politically correct thing to say, but consider he first fled Tibet in 1959. For 50 years…50 freakin’ years… he hasn’t advanced his people one bit by playing the role he does. But every president and world leader has to burnish their human rights credentials so that their tombstones will read in part, “…was a defender of independence for Tibet…” If I’m Obama, I tell the Dalai’s people, “Joe Biden will meet him for a cup of coffee at Starbucks, off site.” [As it was, they shuffled him out a back door when the meeting between the two was over. The guy also needs to dress warmer.]
But in a more important sign of China-U.S. relations, the U.S. aircraft carrier USS Nimitz sailed into Hong Kong on schedule on Wednesday despite China’s pledge to suspend military relations between the two nations over Washington’s arms sales to Taipei.
However, the recent trend of Chinese behavior remains disturbing. Robert Samuelson wrote in the Washington Post:
“It would be a tragedy if these two superpowers began regarding each other as adversaries. But that’s the drift. Heirs to a 2,000-year cultural tradition – and citizens of the world’s largest country – the Chinese have an innate sense of superiority…Americans, too, have a sense of superiority, thinking that our values – the belief in freedom, individualism and democracy – reflect universal aspirations.
“Greater conflicts and a collision of national egos seem inevitable. No longer should we sit passively while China’s trade and currency policies jeopardize jobs here and elsewhere. Political differences between the countries are increasingly hard to ignore. But given China’s growing power – and the world economy’s fragile state – a showdown may do no one any good. Miscalculation is leading us down dark alleys.”
Lastly, on the cyber-attack front, two educational institutions, one with close ties to the Chinese military, have been identified as the source of online assaults on the likes of Google and other American corporations. One of the school’s computer networks is operated by a company with close ties to Baidu, as reported by the New York Times.
Ukraine: Prime Minister Tymoshenko appealed to the high court to investigate the presidential election that official results show she lost to Viktor Yanukovich by 3 ½ points. Yanukovich has been declared president and will be inaugurated Feb. 25 unless the court issues a stay, which seems highly unlikely. European observers said the election was free and fair. Yanukovich’s first official foreign visit will be to Moscow, as you’d expect.
Russia: Incredibly, or perhaps not so given the nature of the arms business, France has proposed selling Russia a modern assault ship that Georgian President Saakashvili said could lead to direct confrontation between NATO and Russia in the Black Sea. Another French company is looking to sell Moscow armored personnel carriers that are also superior to anything Russia currently has. Saakashvili said it’s about Vladimir Putin looking to burnish his bid to retake the presidency in 2012. French President Sarkozy has approved but not formally announced the sale. What’s nuts is that it was Sarkozy who brokered an end to the 2008 conflict between Russia and Georgia, gaining all manner of promises from the Kremlin that were immediately broken.
Argentina / Britain: Back in 1982, Argentina claimed sovereignty over the Falkland Islands, which were Britain’s; Britain then sent a taskforce that seized back control, with 649 Argentine and 255 British soldiers killed in the short war, but ever since tensions have remained over the territory.
So now Argentine President Cristina Fernandez de Kirchner, a desperate woman clinging to power, has imposed new controls on shipping to the Falklands as part of a dispute over oil. All ships headed there are to ask the Argentine government for permission first. This bears watching. Argentina’s leaders have a history of being among the world’s true idiots.
North Korea: Our favorite dictator Kim Jong-il turned 68 on Tuesday. Needless to say there were all manner of celebrations for the “kind-hearted father” who forces his people to eat dirt, if there is any left. In case you didn’t have a ticket, “synchronized swimmers, figure skaters and a dancing art troupe visiting from Japan sang gloriously and longingly,” according to the official news agency. Glad I missed this one.
Random Musings
–There were lots of interesting polls this week. A USA TODAY/Gallup survey asked, “What are the one or two strengths of the United States that make you most optimistic about the future of the country over the next 20 years?”
35% said, “Strength/will of the American people”
14% “Military/homeland security”
Then, “What are the one or two weaknesses of the United States that make you most pessimistic about the future of the country over the next 20 years?”
20% said, “Government corruption/inefficiencies”
15% “Military/homeland security/terrorism”
It’s the 35% who consider the American people and their will as being a major positive the next 20 years that I couldn’t disagree with more.
–A CNN/Opinion Research Corp. poll indicated that only 34% feel that current federal lawmakers deserve reelection, with 63% saying no; the former the lowest number ever for the CNN survey.
51% feel their own member of Congress should be reelected – also an all-time low in CNN polling – while 44% say their representative doesn’t deserve to be returned to office in November.
And an equal amount, 56%, say that either most Democrats in Congress do not deserve to be reelected, or most Republicans don’t.
Assuming Obama runs for a second term in 2012, 44% of registered voters say Obama deserves reelection, with 52% saying the president does not deserve a second term.
–So against that background, Democratic Senator Evan Bayh of Indiana shocked his party in announcing he would not run for a third term this fall, the 54-year-old moderate (and favorite Democrat among Republicans) said that while he believed he would have won (and there is every indication he would have), he was sick of Congress, saying in his statement:
“For some time, I have had a growing conviction that Congress is not operating as it should. There is too much partisanship and not enough progress – too much narrow ideology and not enough practical problem-solving. Even at a time of enormous challenge, the peoples’ business is not being done….
“To put it in the words most Hoosiers can understand: I love working for the people of Indiana, I love helping our citizens make the most of their lives, but I do not love Congress.”
Suddenly, Democrats face tough a tough go of it in Colorado, Delaware, Illinois, North Dakota and Indiana (with former Republican Senator Dan Coats now poised to fill the void left by Bayh’s departure). Additionally, Arkansas and Nevada are looking bleak.
“Can Mr. Obama still make a mid-course correction, a la Bill Clinton after 1994? Of course he can. What we don’t know is whether he has the political instincts and nerve to do so. As a creature of Chicago politics and the legal class, he has lived his entire life in precincts dominated by the political left. On the other hand, he says he is not ‘an ideologue.’
“Americans have already sent one rebuke to Democrats in the form of Scott Brown’s victory in Massachusetts. Now Mr. Bayh, a senior Member of their own party, has sent another by skipping town and putting another Senate seat in play. Our guess is that it will take one more repudiation in November before Democrats relearn that you can’t govern America successfully from the political left.”
“(It is 2010), and Mr. Bush is gone. Mr. Obama is left with America, and he does not, really, understand it. That is why he thinks moving to the center would be political death, when moving to the center and triangulating, as Bill Clinton did, might give him a new lease on life.
“But there’s something else that has led Mr. Obama to his falling poll numbers. When FDR followed the disaster that was Herbert Hoover, he took a new and different path. The government would now hold a new place in the daily American reality. When Ronald Reagan followed the disaster that was Jimmy Carter, he took a new and different path. The federal government would be pushed back from its intrusions on Americans. But when Barack Obama took over after the disaster that was George W. Bush, he did not, in terms of the most pressing domestic issue after unemployment, take a new and different path. He spent, just like Mr. Bush, only even more. It was as if he were saying, ‘You think Bush broke the bank? I’ll show you what a broken bank looks like.’ This isn’t a departure. It’s doubling down….
“Republicans have a recent history of overplaying their hand when up against Democrats with difficulties. It can be hard in policy decisions to determine the difference between what is brave and what is foolhardy, what is desirable and what is possible, especially in a time such as this, when few feel secure. If the Republicans begin to jabber about the abstract and theoretical, they will find the public has little appetite for it. If they amuse themselves with speculation about the potential popularity of ‘playing the war card,’ they will find out that war, actually, is not as popular as they think, and is not, actually, a card.
“Democrats in Congress, on the other hand, may choose this spring to save themselves by revolting – not only against the Republicans, but against the possible one-termer who jeopardizes their positions.”
–And then there is the ongoing story of Sarah Palin. I totally agree with the following two viewpoints of staunch conservatives.
“Sarah Palin isn’t a candidate for office currently but the buzz of expectation surrounds her, none of it exactly vague. She could hardly have been more emphatic, in the last week, about her openness to a presidential run. All the more reason for the intense scrutiny of both her keynote speech to the Tea Party convention a week ago and a subsequent interview with Chris Wallace on ‘Fox News Sunday.’ Not that it required much scrutiny to see the obvious, and fast: that the Sarah Palin of election year fame has not been much transformed since last we met.
“For many who look to her as a presidential hopeful, and a voice for their social views, this can’t be encouraging news….
“On, for instance, the unsavory echoes of her regular references to ‘the real America,’ as opposed to those shadowy ‘elites,’ now charged with threats to the life, liberty and the pursuit of happiness of all real Americans. Neither does she seem to have any idea of how that low soap-box oratory-embracing one kind of American as the real kind, those builders in the towns and cities across America – rings in the ear today. It is not new.
“So entrenched a place does this thinking occupy in Mrs. Palin’s bag of references that it can pop up anytime on any subject. Challenged in Mr. Wallace’s interview on alleged irregularities in her husband’s direct contacts with Alaska state officials – on judicial appointments, labor issues, and the like – Mrs. Palin countered that he was her ‘soul mate,’ her ‘best friend.’ The one she could trust while she was off traveling – and be busy working on ‘issues that meant a lot to him and to people, yes, out there in the real world with steel-toed boots and hard hats trying to build this country.’….
“Mrs. Palin regularly invokes the name of the most revered of her heroes, Ronald Reagan – among the sunniest stars ever to mount the political stage, and a leader who spoke to all of America. He did not appeal to the aggrieved. Nor did he see in the oratory of grievance, or talk of real Americans and those who were not, a political platform.
“Mrs. Palin would do well to look to his model, between study of those daily policy briefings. Her supporters will have to wait a while. At a time when Republican hopes are in the ascendancy, as now (and even when they are not), it’s impossible to imagine the Sarah Palin known to the world today as their leader. It would be well for her to begin pondering the reasons.”
“(In 1964), Barry Goldwater, whose seat John McCain occupies, chose to run with Bill Miller, a congressman from Lockport, N.Y., near Buffalo. Miller, Goldwater cheerfully explained, annoyed Lyndon Johnson. After the Goldwater-Miller ticket lost 44 states, Miller retired to Lockport, where he practiced law and lived in dignified anonymity until his death in 1983. [Ed. Miller’s son was a classmate of mine at Wake Forest…good guy] Although he had served as an assistant prosecutor of Nazi war criminals at Nuremberg and spent seven years in Congress, no one suggested he should be considered for the 1968 Republican presidential nomination.
“Yet Sarah Palin, who with 17 months remaining in her single term as Alaska’s governor quit the only serious office she has ever held, is obsessively discussed as a possible candidate in 2012. Why? She is not going to be president and will not be the Republican nominee unless the party wants to lose at least 44 states.
“Conservatives, who rightly respect markets as generally reliable gauges of consumer preferences, should notice that the political market is speaking clearly: The more attention Palin receives, the fewer Americans consider her presidential timber. The latest Post-ABC News poll shows that 71% of Americans – including 52% of Republicans – think she is not qualified to be president….
“Populism has had as many incarnations as it has had provocations, but its constant ingredient has been resentment, and hence whininess. Populism does not wax in tranquil times; it is a cathartic response to serious problems. But it always wanes because it never seems serious as a solution.
“Political nature abhors a vacuum, which is what often exists for a year or two in a party after it loses a presidential election. But today’s saturation journalism, mesmerized by presidential politics and ravenous for material, requires a steady stream of political novelties. In that role, Palin is united with the media in a relationship of mutual loathing. This is not her fault. But neither is it her validation.”
And to pile on…from the left (center-left)…Richard Cohen / Washington Post
“The lady from Alaska is a phony. She has sold out for money, quitting office so that she could cash in. She asserted her small-town bona fides, her antipathy both to the establishment and the mainstream media – and then got herself a ghostwriter, a booking agent and a Fox News network contract. She is rich, famous for the metaphorical 15 minutes Andy Warhol allotted us all and, elbows swinging, is forging her way to oblivion. She was neither a threat (the left) nor an opportunity (the right), but just a fantasy – until the American people turned the lights on.”
–Arkansas Democratic Senator Blanche Lincoln trails the two leading Republican contenders for her seat by 20 points. Lincoln’s disapproval rating is a whopping 60%.
–Talk about a charlatan, exhibit A is former Tennessee congressman Harold Ford, who is attempting to unseat incumbent Senator Kirsten Gillibrand in the New York Democratic primary.
Ford came onto the scene in these parts with a sense of entitlement, for whatever reason, but what cracks a lot of people up these days is we’ve learned he hasn’t been filing taxes in New York, despite earning income there for 2007 and 2008, though Ford says he was a Tennessee resident until 2009.
But here’s the deal. As everyone knows who lives in the tri-state area in particular (plus these days some folks who commute from Pennsylvania to their jobs in New York), you have to file a nonresident income tax return! Hell, I did that for years. Memo to Harold: Hit the road.
[Meanwhile, the New York Post is trying to encourage publisher and real-estate magnate, Mortimer Zuckerman, who owns the rival Daily News, to run for Gillibrand’s seat. He’d be a terrific choice…. “a heavyweight – and internationalist with a firm grasp on the challenges facing the nation in that realm, a fierce supporter of Israel at a time of grave peril for that embattled country and an experienced businessman with a clear appreciation of how much damage anti-growth fiscal policies can do to America.”]
–The Biden-Cheney face-off on opposing Sunday morning talk shows didn’t prove anything and isn’t worth covering, except they both could be wrong concerning our seeming success in Iraq. Just give it two years.
–80% of Americans are against the Supreme Court ruling opening the door for corporations, labor unions, and such to spend unlimited money from their general funds on election campaigns. Put me in this camp. [About the only thing I disagree with George Will on.]
–Joe the Plumber was back in the news again…yet another sign of the apocalypse.
–This was funny…from Norimitsu Onishi of the New York Times.
“Jakarta, Indonesia – A statue of President Barack Obama as a 10-year-old boy was transferred from a public park here to an elementary school that Mr. Obama attended as a child….Officials in Jakarta bowed to protestors who said the park should be reserved to honor an Indonesian and that Mr. Obama had yet to make any particular contributions to this country.”
Heck, there are some who’d say he has yet to make any particular contribution in America, right sports fans?
And this reminds me…where is the statue for Tom Seaver in New York?
–I thought the New York Post’s Phil Mushnick made an excellent point in reviewing Jenny Sanford’s television appearances in conjunction with her book detailing her days with husband Mark, governor of South Carolina. In discussing the impact on her four children, Jenny said:
“My hope is in the long run they’ll be better men for it, better husbands and fathers….These are weighty subjects to have to discuss with your children.”
“Yes, weighty issues to discuss with your children – and a national TV audience and in a book. In the long run, though, they might be better for it? Maybe. But how? And what about the short run?….
“(How) then does the extension of this scandal, on TV and in a book, serve the best interests of her sons? That’s what reasonable, logical folks – especially parents – would ask, I think….
“Shame does not eliminate dignity. We can invite all to watch, to share and even enjoy our shame. Or we can let our kids know that some hurts are best treated in private.”
–Former New York City police commissioner Bernie Kerik was sentenced to a stricter than expected 48 months in prison for tax fraud and lying to the White House, the latter when he was being considered for Homeland Security Secretary. This, we’ve all learned, is one of the true dirtballs on the planet.
–I have little to say about Tiger Woods’ apology. It’s all about his actions when he returns to golf…period. He talked about respecting the game more, which is all the more reason why he should make his return at Arnie’s tournament in four weeks as a Masters tune-up, but now it appears The Masters itself is in doubt. And when it comes to Tiger’s request that the media leave his family alone, he’s hopelessly naïve.
–From Reuters: “A high-powered laser aboard a modified Boeing 747 jumbo jet shot down an in-flight ballistic missile for the first time, highlighting a new class of ray guns best known from science fiction.”
Yippee! So here’s what I’d do. Next time Ayatollah Khamenei is doing his Friday prayer thing in Tehran, just fire a beam down at his feet. We don’t have to hit the bastard, necessarily. Just scare the hell out of both him and the audience. “Death to America! Death to….Holy
[Toledo]!!!”
–Two items from Army Times. Defense Secretary Robert Gates “is tired of seeing his top aides dressed for a field campaign, and has directed them to start dressing for the office.”
As a spokesperson said of the habit that started after 9/11, “This is the headquarters of the United States military, in our nation’s capital. The people we do business with – be it across the river [on Capitol Hill] or from around the world – are all dressed in business attire when they come to see us here. And [the secretary] thinks we should be dressed accordingly.”
Can’t argue with that. But the troops in the field can’t be too happy with a new policy adopted by Gen. Stanley McChrystal, commander of U.S. forces in Afghanistan. He is taking away the fast-food outlets like Burger King and Taco Bell as part of a closure of all manner of concessions, including jewelry stores and new car sales efforts.
McChrystal believes morale, welfare and recreation activities (MWR) are taking troops’ minds off what they need to be thinking about. “MWR should never be the distractor that changes the focus of the mission.” This is not going down well, but at least fitness centers and Internet access sites will remain open. Army Command Sgt. Maj. Michael Hall told Army Times, “This is a war zone, not an amusement park.”
–The last Canadian veteran of World War I died, John Babcock. He was 109. Only two others survive…American Frank Buckles, 109, and British-born Australian Claude Choules, 108.
Canadian Prime Minister Stephen Harper said, in paying tribute to the 650,000 Canadian men and women who served during World War I, “Today they are all gone.
“Canada mourns the passing of the generation that asserted our independence on the world stage and established our international reputation as an unwavering champion of freedom, democracy, human rights and the rule of law.”
Pray for the men and women of our armed forces, and all the fallen.
Gold closed at $1117
Oil, $79.95
Returns for the week 2/15-2/19
Dow Jones +3.0% [10402]
S&P 500 +3.1% [1109]
S&P MidCap +3.4%
Russell 2000 +3.4%
Nasdaq +2.8% [2243]
Returns for the period 1/1/10-2/19/10
Dow Jones -0.2%
S&P 500 -0.5%
S&P MidCap +1.9%
Russell 2000 +1.0%
Nasdaq -1.1%
Bulls 35.6
Bears 27.8 [Source: Chartcraft / Investors Intelligence]
Have a great week. I appreciate your support.
Brian Trumbore
