Wall Street
The market rally continued and this week there was some legitimate good news, particularly on the manufacturing end as virtually all nations recorded a pickup in activity for the month of March, with purchasing managers index (PMI) readings generally in the mid-50s, with 50 being the dividing line between contraction and growth. In the U.S., the figure was a better than expected 59.6.
But does this mean we are off to the races? Certainly Friday’s employment report for March, a gain of 162,000 jobs, a little less than expected, though with fewer census workers figured in than guesstimated, doesn’t exactly foretell this. The official unemployment rate, after all, remains at 9.7%, far higher unofficially, while the number of long-term unemployed, defined as being out of work at least six months, surged to over 6.4 million. This is a tragedy with huge implications, and costs, down the road. The employment report also revealed that average hourly earnings declined, while earlier in the week we learned personal income for February was unchanged.
So while many talk of big growth rates in terms of GDP the past two quarters, including the just completed one, I’ve been on board with PIMCO from the standpoint it’s not about the past six months, or the new quarter, it’s about the second half and beyond, but where I deviate with my old friends (and employer) is that I remain fixated on geopolitical events that could change sentiment and kill the recovery in a flash. I truly believe this will be the case before the end of the year. I hope I’m wrong…for one thing, my portfolio isn’t exactly positioned for Armageddon, something I need to address quickly (not including my holding in natural gas as a play on a far stormier hurricane season). It’s just that when it comes to the argument, as postulated by PIMCO and their ilk, whether or not the recovery is sustainable, I say it isn’t, regardless of any flare-up with my hot spots or a large-scale terror attack (far more market-moving than Moscow, for example).
I just believe that visibility in the second half has to be limited, though like you I await to see if the coming round of earnings reports provides further clarity. The global stimulus, emphasis on global, is winding down, after all, and at week’s end, China’s central bank kind of summed it up perfectly.
In discussing its concerns over the potential for asset bubbles in all parts of the world as well as certain industries, the People’s Bank of China opined that “ultra loose” monetary policies by governments around the world “don’t mean real economies have recovered or will recover strongly.” Such gains “unless they receive sufficient support from macroeconomic fundamentals, may lead to a new round of asset bubbles that may burst.”
China, of course, faces the exact same issues as others do…when to cut the flow of money, seeing as it is an “unbalanced global recovery.” This is also where the issue of sovereign debt comes into play. Such as with Greece.
This week, needing to raise $21 billion by end of May, Greece rushed out $6.7 billion in 7-year paper but the interest rate was 3.30% above the corresponding German benchmark, and then in the aftermarket it went as high as a spread of 3.67%. This increases Greece’s interest expense far more than they hoped for, given the government thought they had received a vote of confidence from both the European Union and the IMF over their budget cutting proposals, but in the end it was investors who needed to be swayed…and they weren’t. Greece then tried to float some 12-year paper and it was just as unsuccessful. It can wait for rates to come down, but maybe they won’t…and Greece can’t wait forever.
But Greece isn’t the only one with sovereign debt issues. Both the United States and Britain are two rather important economies that ratings agencies have warned face downgrades down the road should they not get their houses in order. Japan is a third. The U.S., though, has a number of problems.
“Let’s be clear. A ‘budget crisis’ is not some minor accounting exercise. It’s a wrenching political, social and economic upheaval. Large deficits and rising debt – the accumulation of past deficits – spook investors, leading to higher interest rates on government loans. The higher rates expand the budget deficit and further unnerve investors. To reverse this calamitous cycle, the government has to cut spending deeply or raise taxes sharply. Lower spending and higher taxes in turn depress the economy and lead to higher unemployment. Not pretty.
“Greece is experiencing such a crisis. Until recently, conventional wisdom held that only developing countries – managed ineptly – were candidates for true budget crises. No more. Most wealthy societies with aging populations, including the United States, face big gaps between their spending promises and their tax bases. No one in Congress could be unaware of this….
“So Obama is flirting with a future budget crisis. Moody’s emphasizes two warning signs: rising debt and loss of confidence that government will deal with it. Obama fulfills both. The parallels with the recent financial crisis are striking. Bankers and rating agencies engaged in wishful thinking to rationalize self-interest. Obama does the same. No one can tell when or whether a crisis will come. There is no magic tipping point. But Obama is raising the chances.”
Irwin Stelzer / London Times…on the coming VAT (value-added tax)
“A 3% levy would bring in $300 billion a year – $280 billion if food is exempted. Throw in inflation of about 4% a year – the number the International Monetary Fund’s economists are now recommending as a target to replace the 2% most central banks are using – and the deficit might just become manageable.
“But America would have been transformed. Government will be more intrusive. The healthcare bill provides for 16,500 new tax inspectors [Ed. The IRS denies this, in the interest of full disclosure, but I’m on board with Stelzer et al] to make sure that every American has health insurance or has paid a fine that by 2016 will come to $2,085 or 2.5% of income, whichever is higher. Emissions from not only coal plants but lawnmowers will be regulated. Standards by which schools will be judged, once set locally, will include federal rules mandating preferential treatment of minorities.
“Incomes will have been redistributed. The incomes of families earning more than $250,000 and of middle-income families will be taxed more heavily to fund programs for lower-income groups. And, if the president has his way, and persuades Congress to grant legal status to the 13m illegal immigrants now in the country, the ethnic and cultural mix of the citizenry will have been changed. That would cost about $30 billion for the healthcare entitlements of this new group but, in the great scheme of things, Obama thinks this will be a small price to pay (it is, after all, not his money) for completing the transformation of America.”
On the healthcare front, it’s sit back and wait time, as in wait for the unintended consequences; items such as the Medicaid burden being foisted on the states at the worst possible time, which will result in a further increase in taxes for the locals, Medicare cuts never enacted, because they never are, which in turn explodes the deficit, a la the above argument by Samuelson, and the IRS agent issue. Those who deny this last one will be the case are really missing the point. Someone has to police the mandates. I’m not…and I didn’t think you’d want to.
In terms of the new uproar over businesses quickly taking huge writedowns, Commerce Secretary Gary Locke wrote in an op-ed for the Wall Street Journal:
“The new comprehensive health-care legislation (reduces costs for families and businesses), and will significantly benefit American businesses by slowing and eventually reversing the tide of crippling premium increases washing over our nation’s employers.
“(The) new law contains numerous reforms that a 2009 study by the Business Roundtable – an association of CEOs of leading U.S. companies – says will help slow the growth rate of health costs over time.”
OK, two things, Secretary Locke. One, why the heck should I believe you when you say the cost savings are real and they will grow over time? Second, you say the new law will help slow the growth rate…not reduce, but help slow the growth rate. That’s the old congressional budget gimmick. Slowing the rate of growth is not a cut or savings.
Corporations, you see, are forced by the SEC to immediately restate earnings to reflect the present value of their projected long-term health liabilities. That’s why they’re making the moves they are, Charlie Brown.
So now that squirrely guy from California, Congressman Henry Waxman, is going to hold hearings to, as Rich Lowry writes in the New York Post, “browbeat the affected corporations….This is naked political harassment.
“Citing the Congressional Budget Office, Waxman says his concern is that the writedowns appear ‘to conflict with independent analyses.’ If he’s genuinely surprised at the real world departing from CBO projections, he should brace himself for more shocks. Is he going to demand that OMB Director Peter Orszag testify when the projected deficit reduction doesn’t materialize?”
“In other words, CEOs who must abide by U.S. accounting laws under pain of SEC sanction, and who warned about such writedowns for months, are merely trying to ruin President Obama’s moment of glory. Sure.
“Presumably the White House is familiar with the Financial Standard Accounting Board’s 1990 statement No. 106, which requires businesses to immediately restate their earnings in light of their expected future retiree health liabilities. AT&T, Deere & Co., AK Steel, Prudential and Caterpillar, among others, are simply reporting the corporate costs of the Democratic decision to raise taxes on retiree drug benefits to finance ObamaCare….
“Perhaps Mr. Waxman should move his hearing to the Syracuse Carrier Dome. The Towers Watson consulting firm estimates that the total writeoffs will be as much as $14 billion, and the 3,500 businesses that offer retiree drug benefits are by law required to report and expense their losses this quarter or next. But ‘twas a famous victory, ObamaCare.”
[In two of the latest polls following passage of healthcare legislation, a Washington Post survey had 46% for the changes, 50% opposed, while a USA TODAY/Gallup poll had 47% calling it a good thing, 50% a bad thing. I’d say that’s pretty consistent.]
Lastly, JPMorgan Chase CEO Jamie Dimon attacked the ‘demonization’ of big banks by politicians in his annual letter to shareholders, which on one hand I don’t disagree with, but then he goes on to say, “While bad actors always should be punished, we also should note that not all who got into trouble were irresponsible.”
No, Jamie. First off, the public is torqued off because no one really has been punished, and, second, any of the industry’s leaders who got into trouble did so because either they didn’t get it (Dimon himself admits he missed the housing bubble) or sat back and watched while their house, their firm, burned.
And then he says, “It is wrong to assume that big firms inherently are risky. Banks shouldn’t be big for the sake of being big, but scale can create value for shareholders and for consumers.”
So here’s the deal. The solution to this big bank, too big to fail issue is simple. Increase the capital requirements, in a big way, and reduce the level of allowable leverage. Then the only other thing that needs to be done in terms of financial regulation is to regulate the hell out of the derivatives market and eliminate, entirely, credit-default swaps.
There, that would take about four or five pages, max. Heck, it would take three paragraphs for everything but regulating derivatives, and for that we could run a short essay contest for, say, $50,000, to see who can do it most effectively in the fewest pages, $50,000 being a lot of money for a writer.
Street Bytes
–As noted above the rally continued for a fifth straight week though once again the gains were minimal; up 0.7% for the Dow Jones to 10927, up 1.0% for the S&P, and 0.3% for Nasdaq. Nasdaq’s last three weekly advances have been 0.3%, 0.9% and 0.3%, hardly the stuff of raging bull markets. Oil’s rise, however, to the almost $85 level, puts it at its highest level since Oct. 2008.
–U.S. Treasury Yields
6-mo. 0.24% 2-yr. 1.10% 10-yr. 3.94% 30-yr. 4.81%
Rates continued their climb with the key 10-year up from 3.69% to 3.94% in just two weeks. Strength in the manufacturing numbers was one culprit, and then those who came to work on Friday in the bond pits pointed to job gains in the employment data, excluding the census workers, as being pretty good. We’ll get more clarity when all markets reopen on Monday.
Charles Schwab, founder and chairman of the firm that bears his name, wrote of how low interest rates are squeezing seniors in an op-ed for the Journal. It’s so true. Seniors who played by the rules, “who diligently saved for a lifetime and had amassed a nest egg of $100,000 could count on an added $5,400 in retirement income per year [back just three years ago when the average yield on a one-year CD was 5.4%]. That may not sound like much to the average Wall Street Journal subscriber, but for a senior on fixed income that extra money improved the quality of his life.”
Today, that one-year CD is more like 1.3%, if you’re lucky.
“Many in this age group are being forced to stretch for income one of three ways. One is to take on more risk just as they are progressing through retirement. Another is to go longer in maturity with their fixed income investments, locking them into a situation where inflation will bite further into their principal and purchasing power. And the worst is the slow erosion of principal that is already occurring as people cash out of savings to make up for needed income….
“The large banks are well on the mend. Profits are improving and they’re doing just fine. Our seniors are not. Those in Washington should keep their plight in mind as they consider Fed monetary policies going forward.”
–China’s purchasing managers index for March came in at 55.1, and for the first quarter was the fastest since 2004. In the 16-nation eurozone, there was similar strength in manufacturing, though at the same time the unemployment rate hit 10.0%. The IMF also cut Germany’s growth forecast for 2010 to just 1.2%. [Unemployment here, though, is 8.5%. It’s 10.1% in France and a stratospheric 19% in Spain.] At least the increase in consumer prices in the eurozone was just 1.5% in March.
Speaking of inflation, or lack thereof, in Japan, wages fell in February for a 21st straight month. Until we see wage growth, around the world, don’t look to me to pull the inflation alarm. But understand something else. If I’m telling you that I don’t believe the recovery is sustainable, I’m also saying that any little blips in inflation will quickly be extinguished. I do not, for instance, believe in the commodities bubble. We’re almost back to $3.00 gasoline, for example, above that in California already, and every Tom, Dick and Ahmed knows that this is a magic number in the States. We begin to cut back on other things, as well as driving.
But I’ll give the inflation hawks a sop…Australia, where the CPI rose 2.5% in March. Then again, that doesn’t scare me either…I think I’ll have a Foster’s.
–In the latest S&P/Case-Shiller reading on housing, the 20-city index rose 0.3% from December to January, the 8th consecutive gain, though housing values for this benchmark remain 30% below the peak nationwide. Economist Robert Shiller, like everyone else, is trying to figure out the twin impacts of the government taking away the first-time home buyer incentive end of this month, as well as the Federal Reserve’s move to end its mortgage purchase program, one that some have called the single most important factor in preventing a further crash in housing. At least in the short run, with the Fed no longer backstopping mortgages, few expect rates to move significantly higher…unless other rates take the first step in that direction.
But there was another piece of decent news. For a while there have been fears that a second round of foreclosures would result from the remaining option-ARM mortgages resetting to higher rates (and mortgage balances having to finally be paid down), but it turns out this isn’t the problem it appeared to be because so many of the folks are already foreclosed on! Isn’t that great?!
–U.S. auto sales in March soared 24%, though this is in comparison with the bottom of the sector last year. Nonetheless, good news, especially if you work in the industry. Showing the strength in its brand despite all its problems, Toyota’s sales rose 41%. Ford’s rose 40%, and GM’s 21%, but Chrysler continued to struggle, off 8% to just 92,623 vehicles. Separately, Honda’s U.S. sales were up 22%, Hyundai’s 15%, and Nissan’s 43%.
[Toyota’s sales in its home market of Japan rose 51% even with all the global recalls. Toyota holds about half the domestic market there.]
–President Obama, in a bit of a surprise, opened up large sections of the eastern Gulf of Mexico and an area off the Virginia coast for oil and natural gas drilling.
“To set America on a path to energy independence, the president believes we must leverage our diverse domestic resources by pursuing a comprehensive energy strategy,” read an official statement accompanying the president’s move. At the same time the White House is shutting down sites previously approved off the coast of Alaska. So Obama is appealing to Republicans (and trying to win support on stalled climate change legislation), while maintaining support among environmentalists, a seemingly impossible tightrope act but he deserves credit for trying.
That is he deserves credit if you really believe he is partially opening up the waters, but as the Wall Street Journal’s editorial board points out, “the assent to drilling off Virginia…was already in the works and due to be bid out next year. Interior has now postponed the lease until 2012, for reasons it didn’t explain but which gives even more time for environmental groups to sue over its implementation.
“As for the rest of the East and West coasts – nada. The Bush plan had allowed leasing along the North Atlantic and Pacific coasts, but Mr. Obama is effectively reimposing the moratorium on those areas. The President will allow a study of drilling along the South Atlantic coast.”
So you have a right to be underwhelmed, especially by breathless reports on the nightly news that would lead you to believe thousands of jobs are now available, life jacket included.
–A Chinese court sentenced four employees of Anglo-Aussie mining giant Rio Tinto to 7 to 14 years in prison for taking bribes and stealing commercial secrets in what the Australian government declared to be a harsh verdict. It was a case that has long been followed and feeds foreign investor concerns over China’s legal system. Rio Tinto did, however, dismiss the four shortly after sentencing as the company sought to limit damages to its vast business interests in China. Interestingly, Rio called on Dr. Henry Kissinger to represent its position going forward as Kissinger used his contacts to arrange meetings between Rio execs and Chinese Politburo members. Kissinger, at 87, is still highly respected in China. Should you ever hear that the sentences have been significantly reduced, he’ll no doubt deserve some of the credit.
But the Rio case was as much about iron ore pricing, if not more so, than any espionage activities of the four in question and this week Chinese steelmakers strategized over how to deal with the miners such as Vale, BHP Billiton and Rio Tinto, the three of which control about 2/3s of global iron ore trading. At issue is how to set prices, with Chinese and European steelmakers having to deal with increases of 80% to 100%. Now, it would appear, a fairer system is being put in place with prices determined quarterly rather than annually, which brings iron ore more in line with the spot market and actual market prices, though now I’m reading there are new protests that this is nothing but a new scam.
–As part of its streamlining, Citigroup sold off its Primerica life insurance and financial products unit in an IPO that raised $320 million. The shares, priced at a better than expected $15, closed at $19.44 their first day of trading, Thursday, an encouraging sign for the moribund IPO market.
[In terms of the health of Wall Street overall, there are definite signs of hiring (though Friday’s jobs report didn’t reflect this as yet), with the likes of JPMorgan Chase adding 1,000 bankers across the U.S., while Bank of America has 3,600 job openings and Edward Jones is hiring 1,000 financial advisers.]
–The U.S. government formally announced it is looking to sell its stake in Citigroup, 27%, or 7.7 billion common shares that it acquired at $3.25. Citi shares closed the week at $4.18, so at that price a nice profit, though the sales will take place on a very gradual basis so as not to disrupt the market.
Since the Citi move is part of the $700 billion TARP plan, put together at the height of the crisis in September 2008, it is encouraging that of the $245 billion worth of capital pumped into financial institutions, it appears 3/4s will have been recouped should the Citi sales go through at roughly existing levels. The remainder, much of it in the hands of smaller banks that continue to require the capital, will take longer to get back. As to TARP overall, most of the losses, currently estimated at $100 billion when this chapter in our financial history is fully written, come from General Motors, Chrysler and AIG, not the banking sector. But then there’s the following…
“By now, the Obama administration was supposed to have a plan to reform Fannie Mae and Freddie Mac, the ‘government-sponsored mortgage finance enterprises (GSEs) that have been under federal control – and absorbing $126 billion in federal cash – for the past 19 months.
“But last week Treasury Secretary Timothy F. Geithner told the House Financial Services Committee that all he can promise is a ‘public comment’ period starting April 15, in which the various housing interest groups – and there are a lot of them – can submit their ideas. Thereafter, at an unspecified ‘time of greater market stability,’ legislation can be drafted, introduced and passed.
“In short, after a year of discussion, Mr. Geithner promises more discussion.”
In case you’re wondering why I have said little on the topic the past few months, I knew I’d be just spinning my wheels. We keep feeding the Fannie and Freddie monster with no end in sight. What else is there to say until our officials actually begin to act to shut them down, recognizing that their very existence remains paramount to any lasting recovery in the housing market, at which point maybe you can then realistically liquidate the two.
–Then you have the nationalization of the college student loan market, part of the healthcare bill, or as the Journal put it, “one more plank in the cradle-to-grave entitlement state.”
“This week’s legislation is also a way to lever up spending on federal college grants. That’s because Congress is pouring the putative savings from punishing Sallie (Mae) and other private companies into more Pell grants. The savings are illusory, based on government accounting rules that ignore the likelihood of higher future loan losses, but the spending will be all too real for taxpayers.”
–While Ireland reported that its manufacturing sector, like that of just about the entire world, rose in March, as revealed by expansion in its PMI to 53, there is zero doubt the nation remains mired in its worst recession in history as the latest data reveals the economy here has shrunk to the tune of 25% since the peak in the first quarter of 2007. As reported in the Irish Independent, 127 companies a week…a week…have gone under since then, or some 12,000+ in total. Nationally, the housing market has cratered 41% (47% in Dublin).
Of course it’s about the banking sector, that in turn led to some amazing irresponsibility on the part of individuals, as well-documented in these pages. This week, Finance Minister Brian Lenihan, in laying out the carnage and plans to nationalize virtually all the financial institutions, save for the Bank of Ireland, said, “Our worst fears have been surpassed. The detailed information that has emerged from the banks in the course of the process is truly shocking.”
You think Americans have it in for our bankers? I’m amazed the bankers in Ireland all haven’t been lined up and shot. The anger is palpable, such as for the banking exec that loaned himself $150 million, and then lost or spent it all on personal aggrandizement. Lenihan estimated that the bailout of the banks would cost at least $43 billion, an enormous sum for a country this size (think of TARP by comparison). Already nationalized Anglo Irish Bank requires at least $18.5 billion alone, though Lenihan said there are still “significant uncertainties” with this and every other figure.
–In an annual ranking of top earners in the hedge fund industry by AR: Absolute Return+Alpha magazine, David Tepper headed up the list with a Carl Sagan-like $4 beellion as his flagship fund gained more than 130%. [Did you know Sagan has been gone 13 years? I still really miss the man. He was only 62 and could have provided some amazing insight this past tumultuous decade. Sighhh….] Anyway, George Soros pulled in $3.3 billion as his chief fund returned 29%.
–Typical of the pay culture, New York Times Co. Chairman Arthur Sulzberger and President Janet Robinson received total compensation of $6.2 million and $5.9 million, respectively, in 2009, even as they were squeezing the Boston Globe for $10 million in concessions to keep the paper afloat. It’s sickening.
–Discount airliner Ryanair, Europe’s largest carrier, upped its profit forecast for the year ending March as it said the worst recession to hit the global aviation industry may be easing.
–The U.S. Agriculture Department issued an annual survey that forecast another year of potentially record harvests that signal little food inflation in 2010. The problem is you don’t want prices to necessarily fall, either, because that depresses the farm economy and there are concerns we face a glut of corn. Of course weather, specifically the next three months, has a lot to do with the outcomes.
–With the debut of the iPad, details are emerging about the recent stock sales of four top Apple executives who pocketed a collective $200 million, though to be fair this was largely the result of restrictions being lifted on restricted shares. Apple shareholders (and employees) can’t bitch too much about this one, compared to the above New York Times story, as they’ve done mighty well themselves.
Separately, Apple is introducing a new iPhone that will take away AT&T’s current monopoly, as competitors like Verizon Wireless and Sprint Nextel will finally be able to use Apple’s new technology, though there are questions just how quickly Verizon et al will be able to roll out their products.
–China’s Geely agreed to acquire Volvo from Ford Motor for $1.8 billion in the biggest overseas acquisition by a Chinese automaker. The deal makes sense for Ford as it will now focus on its namesake brand. It also makes sense for Geely as it acquires a luxury make to sell to China’s increasingly affluent market.
–Finally, a tentative agreement was reached that paves the way for three office towers at Ground Zero by 2015. But as Crain’s New York Business asks, can developer Larry Silverstein and the Port Authority of New York and New Jersey find tenants to fill them? The positive is that the buildings will be state-of-the-art compared to existing downtown properties. The negative is there is a ton of available space already on the market.
–Attention gold bugs…China’s gold consumption could double in the next decade if the economy continues to grow at a solid clip. China accounts for 11% of global demand. China is also now the world’s biggest producer, increasing output by 84% in the past decade, though with just 4% of the total known global gold reserves, according to the World Gold Council.
–Piracy, after all the talk, is actually up these days but on Thursday, a gang of Somali bandits stupidly took on the USS Nicholas, a guided missile frigate that had been tracking them. Aside from disabling the pirates’ skiff, the crew of the Nicholas also captured what was described as the pirates’ mother ship. The broader issue continues to be Somalia, which hasn’t had a functioning government in 19 years.
–Albert Gonzalez was sentenced to 20 years in prison for what the judge described as “the largest and most costly example of computer hacking in U.S. history.” As part of a plea agreement, Gonzalez agreed to hand over $1 million that he had buried in his parents’ garden, along with a condo in Miami, a car, and diamond ring. This was the case where he and two Russian co-conspirators targeted more than 250 U.S. companies. He should have received life without parole.
–Ronald McDonald faces life without parole. Half of those polled want him to call it quits, saying he contributes to the country’s obesity epidemic. Said a spokesperson for the group that sponsored the survey, “He is a deep-fried Joe Camel for the 21st century.” He’s a creep. Lock him up.
“Cops said an irate man crawled out of his car and into the drive-thru window of a McDonald’s in New Jersey just to get his hands on a Filet-O-Fish sandwich.” A policeman in South Brunswick said, “His Filet-O-Fish was taking too long at 4:30 in the morning.” We really need to chill out, people.
My portfolio: The China holding of mine reported solid earnings and a positive outlook. For those of you playing along at home, I continue to maintain you should see a decent pop following the reporting of first quarter results, probably around mid-May, but I also plan on holding this for up to another two years. I’m also fixated, however, on the overall Chinese economy. If we keep hearing of growth rates of 9%, or higher, my company will get its fair share. That’s the real bottom line.
Foreign Affairs
Russia: Chechen rebel leader Doku Umarov, who awhile back warned Russia that “war is coming to your cities,” claimed responsibility for the twin suicide bombings in the Moscow subway system that killed 39, retaliation for what Umarov said were Russian security force moves against the militants. Two days later, at least 10 were killed in a double suicide bombing in Dagestan, which has become the new hotspot as many of the terrorists have been driven from Chechnya to there, or Ingushetia. Russian President Dmitry Medvedev, who is in charge of the security services, called for “brutal” measures against the likes of Umarov. Earlier, Prime Minister Vladimir Putin, who needs to distance himself as much as possible from the mess, said the terrorists should be “dredged from the bottom of the sewers” and sent to “the kingdom of God.” Medvedev, it needs to be noted, has adopted Putin’s classic dress of black jacket with black t-shirt.
I’ve been to Moscow twice in the past 8 years (2002 and 2007) and it’s not only fascinating, it’s depressing. Going back to the apartment bombings of 1999 (I had my own unique theory on these, long before the late-William Safire put out for public consumption that the government itself had a hand in them), and other major terror attacks, many of the people here live in constant fear. The people of Russia are angry that their government cannot protect them, and, again, watch for what happens on May Day.
I also thought the New York Post’s Ralph Peters nailed it when he reminded his readers that the region from which the terrorists are coming is but a day’s drive from Sochi, site of Putin’s 2014 Winter Olympics, “which could wind up making the 1972 Munich Games look like a terrorist amateur hour.” The terrorists hate Putin. Anything to embarrass him is a victory. Imagine, then, what impact the Islamists could have on this world stage, right in their backyard. You’d be nuts if you even considered going here (just like I think you’re nuts if you want to attend the upcoming World Cup in South Africa).
As for the arms control treaty that the United States and Russia will sign coming up in Prague, April 8, the Associated Press pointed out that it took so long to conclude that President Obama’s chances of achieving another one of his key goals in his nuclear-free daydream, Senate ratification of a nuclear test ban treaty, could not possibly be signed this year, because the Senate will only have time to take up the replacement for START. Obama needs 2/3s of the Senate for ratification of both and with just 59 votes seemingly in his pocket, he needs Republican support and the composition could be quite different after November.
But here is what I’ve been focused on; whether or not the new START treaty would allow the U.S. to modernize its remaining nuclear force and we’ve learned that will not be the case. In fact the London Times reported on Friday that “Mr. Obama is expected to rule out the development of new weapons systems – despite reservations from the military, which is mindful that Russia and China are modernizing and expanding their nuclear forces respectively. [Next week] He will also drop the notion, espoused by his predecessor, that nuclear warheads can be deployed in certain circumstances; for example, if another country resorts to attacking U.S. forces with chemical or biological weapons.”
Folks, this is a huge issue, or combination of issues. I will do everything I can, in my own small way, to defeat such a plan. As reported in Defense News, two senior Republicans, Sens. Jon Kyl, Ariz., and Minority Leader Mitch McConnell, Ky., “have warned Obama that he must develop a plan for modernizing the U.S. nuclear arsenal before they will support a nuclear weapons drawdown treaty.
“The pair have also warned that any restrictions on U.S. plans to build missile defenses in Europe would doom ratification.”
I have no problem with the new START treaty, by itself, that would reduce the number of deployed nuclear weapons for each country to 1,550. [The U.S. now has about 2,200 deployed weapons and Russia 2,600.] But no way on the rest, though there is also the story that Obama will unilaterally go well below the 1,550, which is where the doctrine of where nuclear warheads can be deployed comes in. If you take away the ability to use them against a nation that doesn’t have its own capability, then you severely limit your targets, ergo, Obama could go down below 1,000.
Iran: Much is being made of China’s seeming new cooperation in the effort to impose another round of sanctions on Tehran, though by now if both Russia and China were to acquiesce, the provisions discussed thus far, such as those focusing on Islamic Revolutionary Guard leaders and firms it controls, will in no way impede Iran’s weapons development efforts.
It’s also becoming increasingly clear to any number of analysts, including yours truly, that the White House is accepting the idea of Iran churning out nuclear weapons. Recall, for me President Obama’s legacy is about nothing other than Iran and North Korea and whether these two continue down their current path. [These days, you could also throw in Pakistan. Militants taking over there and it’s hell on earth.]
You can talk until you’re blue in the face about health care and any number of other issues designed to carve his image into Mount Rushmore (he has a thin face, somehow he’s gotta believe he could be squeezed in), but if Iran becomes a nuclear power it’s officially bunker time. It is unfathomable to me how anyone can think about containing Iran, unless you tell me that the government turns into another France and at worst we have prickly conversations over who dissed who in terms of official protocol.
It’s also been unfathomable that the Obama administration did not publicly support the opposition in Iran when it had a chance to have a maximum impact. Don’t get me wrong, I understand fully why Obama acted in such a fashion, seeing as how he thought he could cut a deal with Ahmadinejad through sheer force of personality. It hasn’t worked. And as William Kristol points out in a Washington Post op-ed, George W. Bush isn’t blameless either in this regard. Three Security Council resolutions, after all, passed on Bush’s watch with zero effect as well.
Plus now we learn, as reported by the New York Times, that Iran is prepared to flip off the U.N. yet again in building additional uranium enrichment plants that could only be meant for furthering a nuclear weapons program, in total defiance of the Security Council.
“The implications of this ostrich-like behavior are grave. Some Gulf states (including, some say, Qatar, which hosts American forces and equipment) have begun to openly propitiate the Tehran regime, anticipating its regional dominance once it is armed with nuclear weapons. Others, not reassured by Clinton drop-bys and ineffectual back-patting, have begun to explore their own nuclear option. Repeated rumors that Saudi Arabia is negotiating to buy an off-the-shelf Pakistani nuclear weapon should not be ignored.
“What of Israel? The mess of U.S.-Israel relations has ironically only bolstered the fears of Arab governments that the current U.S. administration is a feckless ally. If the U.S. won’t stand by Israel, by whom will it stand? Conversely, our adversaries view both the distancing from Israel and the debacle of Iran policy as evidence of American retreat. All the ingredients of a regional powder keg are in place.
“Finally, there is the military option. Israeli Prime Minister Bibi Netanyahu left Washington last week befuddled by Mr. Obama’s intentions on Iran. Should Israel decide to attack, the shock waves will not leave the U.S. unscathed. Of course, Mr. Obama could decide that we must take action. But no one, Iran included, believes he will.
“And so, as the failure of Mr. Obama’s Iran policy becomes manifest to all but the president, we drift toward war. The only questions remaining, one Washington politico tells me, are who starts it, and how it ends.”
Israel: They have to. But they need Washington’s support, as well as that of European nations such as Britain, France and Germany, which is why not only is the East Jerusalem flap important, but also the Mossad passport screw-up I’ve written so much of. In the end, though, it’s about Israel’s very existence. They’ll either go it alone, or Netanyahu will suddenly make a flurry of concessions to get key players back on his side, only he then faces a loss of power as his hard line coalition partners abandon him and a new election is called. Talk about a nightmare. The next campaign there could well turn into a civil war…settlers against the IDF.
“The issue that should make peacemaking a necessity rather than a hobby for both the U.S. and Israel is confronting a nuclear Iran. Unfortunately, Israel sees the question of preventing Iran from going nuclear as overriding and separate from the Palestinian issue, while the U.S. sees them as integrated. At a time when the U.S. is trying to galvanize a global coalition to confront Iran, at a time when Iran uses the ongoing Palestinian-Israeli conflict to embarrass pro-U.S. Arabs and extend its influence across the Muslim world, peace would be a strategic asset for America and Israel….
“Indeed, Jerusalem, settlements, peace, Iran – they’re all connected and pretending you can treat some as a hobby and one as a necessity is an illusion.”
Arab League chief Amr Moussa said the peace process could not be open ended.
“We must prepare for the possibility that the peace process will be a complete failure. This is the time to stand up to Israel. We must find alternative options, because the situation appears to have reached a turning point.”
Turkish Prime Minister Erdogan, whose nation holds a temporary seat on the Security Council and who is against another round of sanctions on Iran, said Israeli “violations” of peace in Jerusalem and Muslim holy sites was unacceptable. Erdogan called Israeli attempts to define the whole of Jerusalem as its united capital, “madness.”
[And just a brief word on Lebanon. UN Secretary General Ban Ki-moon said, “I am worried about Hizbullah’s possession of arms. I hope this will be resolved,” even as Lebanese President Michel Sleiman condemned Israel’s breaches of Lebanese territory, both going against Security Council Resolution 1701 that ended the 2006 war between the two. But nothing happens! Either way. Ban did say of my pet idea that Israel should pull out of Shebaa Farms, immediately. Israel’s obstinacy on this matter will prove deadly.]
Iraq: Prime Minister Nouri al-Maliki is appealing the result of the March 7 election that saw his coalition fall short of opponent Iyad Allawi, which will delay for months the formation of a new government. This is our victory? Here’s the deal:
Iraqiya (Allawi)…91 seats out of a 325-seat parliament
State of Law Alliance (Maliki)…89
Iraqi National Alliance (Iran-backed Shia slate)…70
Kurdish Alliance…43
The INA has amongst its coalition leaders Moqtada al-Sadr, who actually controls 40 of the 70 INA seats, so he becomes the real kingmaker. The man who the United States should have taken out when it had the chance to is the man that Maliki is going to, groveling. The INA, in turn, has no problem joining Maliki (cobbling together another four seats to get to 163 wouldn’t be a problem), but it doesn’t want Maliki to be prime minister, seeing as how it was Maliki who largely dismantled Sadr’s militia. Maliki, however, insists on remaining top dog. They say the food is definitely better, for starters.
So while Allawi’s ‘victory’ was trumpeted, I don’t see a scenario where his secular Sunni-heavy coalition can really assume power. Plus, the election commission is looking into six candidates of his that won seats. It seems they were former Baath Party loyalists and the Baath Party had been banned. Ergo, how could they run for office in the first place?
“Maliki’s tirades and rationales lack any substance on at least three counts. First, he happens to have been the prime minister during the poll in question; should the ballot have been irretrievably tainted, that would in fact be a damning indictment of his leadership.
“Next, if Maliki is tarring Allawi as the stooge of the U.S. Well, yes, former Coalition Provisional Authority chief Paul Bremer did appoint Allawi prime minister in 2004; in fact, it is no secret that Allawi worked with the CIA from 1992 as part of his efforts as head of the Iraqi National Alliance to overthrow Saddam Hussein. Alas, Maliki’s charges do not present anything the Iraqi electorate was not aware of before the elections. And in case the prime minister had forgotten, those were actually U.S. officials with whom he had been closely cooperating for the past four years. Perhaps we should remind Maliki that U.S. influence in post-invasion Iraq is simply a fact of life, irrespective of who holds the title of premier.
“Maliki is also throwing around specious arguments that Allawi visited Saudi Arabia before the poll and perhaps received support and money from the Saudis.
“The charge is laughable. Under the standing political dynamic, Iraq’s leaders will have to meet frequently with other regional players. The real question is whether Maliki, Allawi and their colleagues will choose to be surrogates of these powers, either of the U.S. and its allies on the one hand, or of Iran and its partners on the other….
“Of course Iraq’s leaders should listen closely to the interests of outsiders, but their goal should be to find the common ground among those interests and save their land for future generations.
“Today, however, civil war looms. The leaders of Iraq should put internal peace above all else. If they choose the alternative, Iraq will pay the heaviest possible price.”
Meanwhile, Allawi is the only one of the four leading coalitions not to go to Iran and seek guidance on forming a government, which is why the United States loves the man. He would be a bulwark against Tehran. I just don’t see how he gains the parliamentary majority.
Afghanistan: As the number of U.S. troops killed in this theater has doubled in the first three months of 2010 compared to the same period last year, and as President Obama, in a quick trip to Kabul to meet with President Karzai, tried to elicit more cooperation from the Afghan leader in dealing with a corruption-wracked administration, as well as his seeming cooperation with Iran, Karzai, just days later, accused the West and the United Nations of wanting a “puppet government” and of orchestrating fraud in last year’s election. As Country Joe first sang over 40 years ago, “One, two, three, what are we fighting for?” I bet if you pulled off Karzai’s cape you’d find a wimpering twit. Someone should try that. But we can’t haul the bastard off and install Abdullah Abdullah (his opponent in the election) because, well, because that would go against the democratic process, you see.
Not for nothing, sports fans, but between Iran and Afghanistan, you had two stolen elections and the White House has said, and done, squat. This is why I really couldn’t give a rat’s ass about the topic of healthcare, in case you haven’t figured it out by now. What the heck do we stand for?
China: At least it appears tensions between Beijing and Washington are being ratcheted down as President Hu Jintao announced he would attend a nuclear summit in Washington this month, along with 44 other nations. President Obama and Hu also talked this week about the issues of the day, including sanctions against Iran, which it appears China will now approve, seeing as they are watered-down enough so as not to hurt China’s growing economic ties to Iran. Hu has a real incentive in traveling to Washington, aside from the fact he was already slated to be in Brazil days earlier; that being he doesn’t want China to be branded as a currency manipulator by Congress in a report due by April 15, and one would think Obama could get enough members to back off.
Stephen Roach, chairman of Morgan Stanley Asia, in an op-ed for the Financial Times:
“America’s fixation on the ‘China problem’ is now boiling over. From Google to the renminbi (yuan), China is being blamed for all that ails the U.S. Unfortunately, this reflects a potentially lethal combination of political scapegoating and bad economics.
“The political pressures are grounded in the angst of American workers. After more than a decade of stagnant real compensation and, more recently, a sharp upsurge in unemployment, U.S. labor is being squeezed as never before. Understandably, voters want answers. It is all because of the trade deficit, they are told – a visible manifestation of a major loss of production to foreign competition….
“However appealing this argument may seem, it is premised on bad economics. In 2008-09, the U.S. had trade deficits with more than 90 countries. That means it has a multilateral trade deficit. Yet aided and abetted by some of America’s renowned economists, Washington now advocates a bilateral fix – either a sharp revaluation of the renminbi or broad-based tariffs on Chinese imports.
“A bilateral remedy for a multilateral problem is like rearranging the deckchairs on the Titanic. Unless the problems that have given rise to the multilateral trade deficit are addressed, bilateral intervention would simply shift the Chinese portion of America’s international imbalance to someone else. That ‘someone’ would most likely be a higher-cost producer – in effect, squeezing the purchasing power of hard-pressed U.S. consumers….
“America’s core economic problem is saving, not China. In 2009, the broadest measure of domestic U.S. saving – the net national saving rate – fell to a record low of 2.5% of national income. That means America must import surplus saving from abroad to fund its future growth – and run current account and trade deficits to attract the foreign capital….
“Currency, or relative price, adjustments between any two nations are not a panacea for structural imbalances in the global economy. What is needed, instead, is a shift in the mix of global saving. Specifically, America needs deficit reduction and an increase in personal saving, while China needs to stimulate internal private consumption.
“Washington’s scapegoating of China could take the world to the brink of a very slippery slope. It would not be the first time that political denial was premised on bad economics. But the consequences of such a blunder – trade frictions and protectionism – would make the crisis of 2008-09 look like child’s play.”
Two new advisers to China’s central bank did state this week that China should allow the renminbi to resume its gradual appreciation.
North Korea: A funny thing happened this week, as reported by the Korea Times. Secretary of State Hillary Clinton described North Korea as a nuclear-armed country.
“We recognize the new threats that are coming…from rogue regimes like North Korea that already has nuclear weapons, and regimes like that in Iran that are clearly seeking nuclear weapons,” Clinton told a group of journalists in Canada.
“In the past, Washington has refused to explicitly recognize North Korea as a nuclear-armed state, though the Stalinist state is estimated to have enough plutonium to build several nuclear weapons. Pyongyang has conducted two nuclear tests but has not yet, it is believed, developed the ability to place a nuclear warhead on a missile.”
A State Department spokesman would not say whether Clinton’s comments represented a change in U.S. policy. I mean this is kind of an important distinction, don’t you think? For starters, maybe there really has been a legitimate reason for me to sleep with one eye open.
As to the sinking of the South Korean naval vessel, you can’t believe anything you hear. At first, Seoul ruled out North Korean involvement (after the initial reports talked of a torpedo attack), but now a senior official is suggesting an old North Korean mine dating from the Korean War may have sunk the vessel. Most just believe it was an accident. Further compounding the tragedy, though, a South Korean military diver perished in the rescue effort. Pyongyang has yet to comment officially on the incident.
Britain: The travel nightmare here continues as British Airways workers struck for a second time in about two weeks, though the airline continues to fly a reduced schedule, while rail workers were set to strike beginning Monday, barring action from the High Court. The unions say they are tired of taking the brunt of spending cuts.
South Africa: Some 3,000 white farmers have been killed since the end of apartheid in 1994.
Mexico: In what everyone is calling a serious escalation of the drug wars, there were seven near-simultaneous attacks on military barracks across northern Mexico on Tuesday. But the troops killed 18 gunmen, and only suffered one slight casualty themselves. Hooray for the good guys. And maybe, just maybe, America’s druggies will take Easter Sunday off. One day. Try it.
Random Musings
–In another USA TODAY/Gallup survey, 62% of registered voters said they were “more enthusiastic than usual” about the November midterm vote, rare for a non-presidential election year. A record low 28% say most members of Congress deserve re-election. The percentage who say their representative deserves another term dropped to 49%, only the second time it has dipped below 50%. And for the first time, both major parties are viewed unfavorably by most Americans, while 50% say Obama doesn’t deserve re-election. His approval rating is 47%.
“(The) partisanship on both sides (is) a turnoff to independents. They were the people who had taken Obama seriously when he said he wanted to move Washington beyond the recriminations of the George W. Bush years. Regardless of their views on health care – or the economy or education or anything else – they are turned off by the inability of both parties to overcome their parochial concerns and agree on steps to curb the joblessness and debt that are consuming the country.
“The other thing that strikes me about the conversations I’ve had recently in Florida and Texas, the anchors of the Sun Belt, is how the health-care legislation is perceived by those on opposite sides of the debate.
“Despite Obama’s best efforts to convince his listeners that, broadly speaking, they will benefit personally as the legislation goes into effect, most of those I’ve encountered believe it is being done for someone else. The president and his Democratic allies argue that, for the first time, youths will be able to be covered on their parents’ policies until age 26 and that no one will be barred from coverage by a preexisting health condition.
“But for the millions who already are insured – to some extent – by policies issued through their workplace and who worry mainly about the costs, it still sounds like someone else is being helped. And those 31 million uninsured who for the first time will have protection? They are definitely someone else.
“This is not a selfish country, and when Medicare was expanded in 2003 to cover seniors’ prescription costs, there was no backlash – even though it was not paid for.
“But the country was not in a deep recession then, and the sensitivity to borrowing and the national debt was not what it is now.
“This is a country that is feeling the pinch. It has little or no tolerance for politics as usual. And it is skeptical of anyone claiming to offer good deeds. That’s why Congress is in trouble.”
“Between now and November, Democrats must persuade the country that they acted in its best interests when they overrode the public’s doubts. If they succeed and retain their majorities in Congress they will have a green light to advance their wider aims, which include tax reform, labor relations, energy and industrial policies. They will conclude that Clintonism, with its submission to centrist opinion, was an error: they will have learned that they can capture and move centrist opinion. But if voters punish their arrogance, their momentum will be stopped. U.S. policy will be set on a very different course.
“What makes the coming months so interesting is that the outcome is uncertain. The ordinary dynamics of U.S. politics have been overthrown. This thing could go either way.”
–Kathleen Parker / Washington Post…on the Republican National Committee donor scandal concerning a night out for some “young donors” at a West Hollywood lesbian bondage-themed nightclub.
“(Let’s) be clear: RNC Chairman Michael Steele had absolutely nothing to do with it. Got that? He wasn’t there. He doesn’t approve of it. Moving on.
“There’s just one problem: RNC and lesbian bondage are now tattooed on the American brain, and the buck stops at the top. Moreover, if G-string spending were the single offense under Steele’s leadership, then perhaps this stain would fade, as have others, in time for Republicans to tap into voter frustration. Alas, this is hardly the first or the worst example of Steele’s leadership deficit.
“More egregious are his spending sprees and preening self-regard. As one party leader put it in an e-mail, the GOP is in trouble when it is seen ‘as the party of limos (taxis work fine), $6K hotel bills, $2K strip clubs, private jets. What happened to Orbitz or Expedia?’
“ ‘It doesn’t matter if he [Steele] was there or not. He doesn’t have a clue how to spend money and [Republicans] put him in charge at their peril.’….
“In January, the RNC spent $9 million of its $10 million monthly haul, much of it on its annual winter meeting in Hawaii. Keeping a buck out of every 10 is probably not inspiring confidence in donors, who are beginning to put their money elsewhere.”
I wasn’t going to comment on this story, only I already have. It was ten years ago that former Wall Streeter Jon Corzine ran for the U.S. Senate in my home state of New Jersey against Republican Bob Franks, a good man, our congressman at the time, and a Summit High School grad, where I went. Franks voluntarily gave up his congressional seat after four terms because he had promised to do so.
I supported Franks as much as the law allowed in those days, while Corzine spent over $60 million of his own money to buy the election, a record for a Senate campaign at the time.
But down the stretch the race tightened up, far more than Republican “experts” in Washington expected, yet they refused to give Franks some badly needed RNC dollars to help out with last minute advertising that could have made a difference.
So what happened? Franks lost by three measly points, 50-47. I wrote at the time on this site, as well as in a published letter to the editor in a New Jersey paper, that I would never, ever, give another cent to the Republican National Committee and that anyone who does so is nuts. I have kept my word ever since, and have only supported politicians directly. Why anyone would give the RNC, or DNC, a dollar is beyond me. But at a certain level it’s all about ego, and maybe getting a picture with the president if you donate enough. As former NBA star Derrick Coleman once said, “whoopty-damn-do.”
I’m glad the RNC got caught. I’m Republican, but I gleefully rip up all their mailings. These people at the RNC are losers, and, my ultimate test, the last folks on earth I’d want to have a beer with. I’d actually get along far better with a Democratic mine worker, as long as we didn’t talk politics and stuck to West Virginia basketball. [I picked these guys back in November, by the way.]
–Nine members of an anti-government militia group known as Hutaree were arrested and charged with conspiring to kill a law enforcement officer, and then attack those who came to the home base of Michigan to attend the funeral. There is so much I want to say about these incredibly ugly Americans, and what they represent, but I need to bite my tongue.
–One example of the problems faced by the Catholic Church in the sexual abuse scandals comes from the Diocese of Cloyne (Cork, Ireland), as reported by the Irish Independent. The diocese kept a “meticulously maintained secret archive on abuse allegations” from the 1970s and 1980s that has just been discovered and police are now investigating 10 separate abuse complaints against four clerics. The same archives, however, “do not contain any documentation indicating that the Vatican was ever aware of the alarming…issues in the diocese.”
“It is damage that will last at least a generation. It is an actual catastrophe, a rolling catastrophe that became public first in the United States, now in Europe. It has lowered the standing, reputation and authority of the church. This will have implications down the road.”
“(Pope Benedict XI) is the man who, weeks before his accession to the papacy five years ago, spoke blisteringly on Good Friday of the ‘filth’ in the church. Days later on the streets of Rome, the Italian newspaper La Stampa reported, Cardinal Ratzinger bumped into a curial monsignor who chided him for his sharp words. The cardinal replied, ‘You weren’t born yesterday, you understand what I’m talking about, you know what it means. We priests. We priests!’”
This crisis happened over the decades because the Catholic Church is first and foremost arrogant, just like so many other institutions or individuals who are in power too long without any real change. Heck, you need look no further than Congress for another example of this.
[On Good Friday, a senior Vatican priest compared criticism of the Church and Pope Benedict to the historic persecution and “collective violence” against Jews. Oh brother.]
–A senior IRA commander revealed to a researcher at Boston College before he died in 2008, that he had smuggled weapons from New York to Britain on the QE2, with the help of sympathetic members of the crew. 5 to 10 assault rifles, plus sometimes a few hand grenades, were the extent of each shipment, but this equated to up to 240 weapons a year with the QE2 making a couple crossings a month. The weapons were hidden in long coats. Cunard officials were totally in the dark until they began to suspect something was up in 1975, at which point the IRA tried to blow up the ship, but police discovered 874 sticks of gelignite in a block of flats in Southampton and arrested six Irish people, including a crew member. [London Times]
–In one of the deadliest outbreaks of violence in Washington, D.C., in years, four were gunned down and five others wounded in a drive-by shooting, with one of the weapons used being an AK-47 (police later recovered that and two handguns), while the three suspects, thankfully, were soon apprehended. The driver was a boy, 14. I’m sure the kid’s mother said, ‘He is such a good child.’
“Based on evidence and interviews thus far, authorities think the attack was part of a cycle of retaliation spawned a week ago by suspicions of petty theft.”
As in a missing bracelet. Turns out another guy was shot and killed a week earlier due to a man’s anger over his gold-colored jewelry and the attacks are linked.
–Meanwhile, in Newark, N.J., there were no homicides in March, the first such slay-free calendar month there since 1966. Yes, a good time to knock on doors for the Census, don’t you think? Or make that, March would have been a good time….
–CNN’s Larry King had his worst quarter ever, down 43%, as he dropped to 771,000 viewers for the period from 1.34 million in 2009. Sean Hannity on Fox basically quadruples King’s performance in the time slot. [Bill Carter / New York Times] Well, seeing as how Mickey Rooney can only do so many more Hollywood obituaries, before someone has to do his, I’d say Larry, and CNN, have a problem. Bill O’Reilly, incidentally, remains king with 3.65 million viewers.
–Speaking of O’Reilly, next week is the start of baseball season and as I work each evening, I’ll have the Mets on in the background, so unless there is some important issue in America I really need to get someone else’s take on, O’Reilly and the rest are off my screen until October or November…..Drat! I just remembered I have to watch these guys beginning around Labor Day for the midterm election jive. No problem….the Mets will be out of the race come mid-June.
–I’ve always found New York Dem. State Sen. Eric Adams to be a fascinating individual. Oh, he’s more than a bit radical, but the former NYPD captain and co-founder of 100 Blacks in Law Enforcement is entertaining and could one day be a force to reckon with in a congressional race. He’s Al Sharpton without the baggage.
So Adams is the latest black politician to attempt to get black youth to pull up their pants. This has literally been going on for 20 years, but it’s always good to see someone respected in the community like Adams, or Bill Cosby, shine a light on the issue.
Adams is putting up billboards: “Stop the Sag!” and “We are better than this!”
“Children will be children. But as adults, we need to be on record and tell them they’re doing something wrong,” he says.
Of course it was “American Idol” contestant Larry Platt who gave the movement a boost with his “Pants on the Ground” song that urges young people to pull their pants up. Adams adds, “We look like clowns.”
–Good luck handling the mosquitoes in the northeast this summer. With all the rain it’s going to be brutal. And as the Star-Ledger noted, the problem will be exacerbated here in New Jersey over ‘white-nose syndrome’ that has mysteriously reduced the bat population by 90%. Bats can consume more than 3,000 mosquitoes on a single summer night. Obviously, you’d also expect West Nile virus to be an issue, though last year the number of cases was low due to cool temperatures.
–Good news if you’re like me and have one chocolate frosted doughnut each morning with your Dunkin’ Donuts coffee. German researchers found that people who had an average of six grams of chocolate per day (the equivalent of part of a chocolate bar) had a 39% lower risk of either a heart attack or stroke. The report is in the European Heart Journal.
What makes this study different from others extolling the virtues of chocolate is that researchers followed 20,000 people over eight years concerning their diet and exercise habits.
So, combine this with favorable studies on red wine, and beer, and your editor’s Salmon Sunday and we have a real menu for success.
–Leslie Kaufman of the New York Times had a report on the differing opinions on the issue of global warming between climate scientists and meteorologists. The former group, for example, is almost unanimous that the earth is warming, while only about half of the 571 television weathercasters surveyed by researchers at George Mason University and the University of Texas at Austin believed global warming was occurring and fewer than a third believed that climate change was “caused mostly by human activities.”
Joe Bastardi of AccuWeather maintains that the planet is cooling and distrusts the data put forward by climatologists. It’s important because you’ve seen the figures in the polling recently and public skepticism is increasing. As Ms. Kaufman notes, after all, it’s also the television guys who have our attention every day. A study by George Mason and Yale researchers revealed that 56% of Americans trusted weathercasters to tell them about global warming far more than they trusted news services or public figures like Al Gore and Sarah Palin. It’s those light moments when the weathercaster is bantering with the anchor that add up in our psyche.
–Meanwhile, if you believe the Gulf Stream is slowing down, a la the movie “The Day After Tomorrow,” scientists have used satellites to monitor tell-tale changes in the height of the sea to determine it is not, though there is a lot of variability in the data.
So chances are we will not…repeat…not have an Ice Age in our lifetimes. But as soon as that larger volcano blows on Iceland, I will load up on natural gas.
–Correction: Reader Emmanuel S. says that I was wrong in writing last week that a little island in the Bay of Bengal disappeared as a result of global warming. He says it wasn’t a real island to begin with. All I know is I got my story from the London Times, initially, and both that paper and the BBC used the same description. Sorry. [But herein you get a picture of the debate on the topic.]
–Staying on message, in an interview with Defense News, Denmark’s Defense Minister, Gitte Lillelund Bech, her nation’s first female defense minister, is asked this:
Q: The Arctic is heating up, literally and politically. Russia is claiming territory and Canada is beefing up its capabilities in the region. Could there be conflict?
A: “No, we have the Ilulissat Declaration. We went to Greenland and sat down together and agreed that there are a lot of things that we need to work on in the Arctic, and one thing we also agreed is that you should not use military power, for example, to get control of the North Pole….
“But there are lots of things to consider because with the ice melting, within the next 50 years we might have the Northwest Passage and might have a lot of cargo and cruise ships going there. And a whole discussion about who owns the North Pole. We agree with the Ilulissat Declaration: This should be solved by peaceful means.”
A: “Have you been to Greenland? If you visit the Ilulissat glacier and if you see pictures of how it looked just 10 years ago and today, you can see that the ice is really melting, melting, melting, melting off. They have started growing vegetables in Greenland that they couldn’t grow before due to the cold climate.
“So climate change is not just something you talk about, but something that we are seeing. One of the mistakes people make is talking about ‘global warming.’ Global warming is actually just a phrase. We are seeing a total shift in climate, so it’s really climate change, not global warming.”
–Lastly, pray for the people of Rhode Island. What an awful break they caught in round two of the flooding. Picture that in February, in New York City they had record snowfall, followed by record rainfall in March, but in Rhode Island, some parts ended up with so much rain it resulted in flooding not seen in as many as 200 years. As one town official put it, none of the disaster models they had put together came close to approximating the damage wrought by a juiced up Mother Nature. As noted above, you don’t have to believe in climate change, but in the past few years we have had way too many instances of 100-year this and 100-year that. It’s also too trite for me to say, hang in there, friends. But in the case of Rhode Island, this isn’t a situation where idiots keep rebuilding in a flood plain or along the coast and wonder why they are suffering. This is a time for government to step in and help. The state was already hit as hard as any by the recession. They deserve a break…and compassion.
Pray for the men and women of our armed forces, and all the fallen.
Gold closed at $1126
Oil, $84.87
Returns for the week 3/29-4/2
Dow Jones +0.7% [10927]
S&P 500 +1.0% [1178]
S&P MidCap +1.3%
Russell 2000 +0.7%
Nasdaq +0.3% [2402]
Returns for the period 1/1/10-4/2/10
Dow Jones +4.8%
S&P 500 +5.6%
S&P MidCap +9.7%
Russell 2000 +9.4%
Nasdaq +5.9%
Bulls 48.3
Bears 19.1 [Source: Chartcraft / Investors Intelligence…if you’re a contrarian, bear figure is getting way down there.]
Dr. Bortrum has posted a new column…more talk on climate change.
Brian Trumbore
