Wall Street
Let me start by repeating a statement from last week’s review that I stand by even more today.
“This is…an incredibly dangerous stretch for global markets as the currency war has hit on all fronts and it could easily spin out of control.”
I also said, however, that enlightened leadership could save the day; just ask me how confident I am that such leaders exist.
In the past I have pooh-poohed strategists and traders who wasted so much time on the plight of the greenback, and I was right. In the grand scheme of things it has mattered virtually zero because any volatility we’ve seen has been easily manageable.
But that began to change when the euro crisis hit in the spring and right now, as the U.S. Federal Reserve gladly talks the dollar down in an effort to juice exports, believing the potential economic gains outweigh the many risks, the rest of the world is ticked off at us, and China; while China is ticked off at everyone as well, only China is in a better position to do whatever it pleases versus the United States…which shows you how far we are falling as a nation. No doubt, America has been through some rough patches before and eventually gotten through them because of political and private sector leadership, but regarding the former, it’s not as if we are electing a new president this November. We’re stuck with President Obama another two years.
So as the world cries for leadership in resolving the currency war, which is evolving into a trade war, what do the world’s leaders do? For a second time in a week, kick the can down the road, to the mid-November G20 meeting in Seoul, South Korea.
[Reminder, as if this confab doesn’t already have enough issues on its plate, there is the not so little issue of new North Korean leader-in-waiting Kim Jong Eun supposedly having been told to create some excitement through his agents in the field (of which North Korea has thousands in the South). I’ll be so bold as to say the clashes that always accompany these gatherings will turn deadly.]
The Treasury Department was supposed to issue a report on China and its handling of the yuan on Friday, i.e., whether to call China a currency manipulator or not, but the administration has decided to wait until Seoul. I’m not saying this is a bad decision, necessarily, it’s probably the right one, but it was the International Monetary Fund, at its meeting in Washington last weekend, that could have shown some leadership on the topic and did nothing as well.
When you look around the world, the consensus is almost universal. The global economy has slowed in the second half vs. the first, and growth in 2011 will do well to just keep pace with 2010. Growth is projected to come in around 2.5% in the U.S. for 2011. The eurozone below 2.0%. One forecaster the German government uses is optimistic Germany’s GDP will end 2010 up 3.5%, but then says just 2.0% next year. A continuation of the muddle through environment that feels like a recession and does nothing on the jobs front.
Or, as PIMCO first called it, the “new normal.” PIMCO’s Mohamed El-Erian spoke this week of policymakers “losing the peace” after saving the global economy from depression because they fail to understand just how wounded the financial system is. El-Erian points to governments and central banks not recognizing how strained their balance sheets are, and the impact of high unemployment. Additionally, any investments being made aren’t promoting real growth and hiring, while in the case of the eurozone, their austerity programs will contribute to the putrid environment.
El-Erian also addresses a favorite topic of mine from last spring during the first euro crisis; governments will not continue to pony up as they did in the case of Greece. That was a one-shot deal. Period. I told you last week how a majority of the German people, to cite but one example, are now against the euro currency itself!
But what even great strategists like El-Erian are missing when it comes to Europe is another dynamic bubbling up from the surface…not economic nationalism…but nationalism, period. See below in the ‘foreign affairs’ section.
Somehow, leaders need to figure out how to get the global economy on a steady path before other deep-seated issues get a chance to take hold, but the hangover from the financial collapse is so severe, and the deleveraging process still in the early innings, that it’s difficult finding the light at the end of the tunnel. Maybe Chile’s President Pinera, Chile not being a member of the G20, could be invited to Seoul to get everyone in the room to work together. He’s not just an obviously competent politician, he is a highly successful entrepreneur, the skills of which served his nation, and the miners, well these past few months.
Alas, we’re left with the prospects for a trade war. I noted how depressed I was last time by the poll number showing 53% of Americans now saying they don’t like free trade, and economist Irwin Stelzer picked up on this figure as well for his London Times piece last Sunday. It’s all about China, and while I am still optimistic about the future of my very large investment there, I’m as unhappy as the rest of you with some of the things China is doing.
“(There’s) more to rising protectionist fervor. Yes, Americans believe that China is manipulating its currency, which it is; that the manipulation keeps the value of the yuan artificially low, which it does; and that the undervalued yuan contributes to a flood of imports and joblessness in America, which it does. We also know that China has no intention of changing its policy. Responding to pressure from the U.S. Congress and from the EU, China’s premier, Wen Jiabao, said the regime will not bend, because if the yuan rises, low-margin Chinese exporters will go out of business, causing ‘social and economic turbulence…[that] would be a disaster for the world.’
“More likely, as he preferred not to add, a disaster for a regime that, lacking democratic legitimacy, can survive only by delivering a better material life for the still-poor Chinese masses….
“Still, even if China were to accede to its trading partners’ demands, Americans would be unappeased. They see not only an unfair trading partner, but a nation that is using the fruits of that unfair trading system to threaten America’s position in the world. It’s no good calling this a new version of the old xenophobic fear of the ‘yellow peril’ – this fear is well founded….
“This contrast between the expanding influence of China [Ed. including militarily], now a favored trading partner of Brazil and other Latin American countries, and the diminished influence of America is not all that is on Americans’ minds. They worry that China is locking up supplies of vital raw materials, from oil to food, by befriending Iran and other countries hostile to American interests….
“All of which means that the changes in the trade balance that might result from an appreciation of the yuan will do little to rekindle American enthusiasm for free trade. There is more to the irritation with China than the exchange rate, or even China’s persistent theft of American intellectual property. There is concern that a new enemy is emerging while, to borrow from Jack Kennedy, America’s political establishment sleeps.
“The rest of the world is more narrowly focused on China’s currency manipulation. Since its trading partners can’t get China to increase the value of its currency, which is dropping in lock step with the dollar, they have decided to reduce the value of their own currencies in a competitive round of devaluations that bode ill for world economic recovery. Japan is intervening to drive down the yen, Brazil is taking steps to lower the value of the real, and France’s president, Nicolas Sarkozy, wants to put in place a new currency system that will prevent the euro from appreciating.
“John Lipsky, first deputy managing director of the International Monetary Fund, said there is no currency war. Treasury secretary Timothy Geithner, the sole survivor of Barack Obama’s original economics team, said: ‘We’re not going to have a trade war. We’re not going to have currency wars.’ Unfortunately, those estimable gentlemen are confusing their hopes with reality: the early skirmishes in those wars have already been fought.”
Meanwhile, Ben Bernanke gave a speech on Friday, and while he is being careful not to say too much prior to the election, he still managed to leave little doubt the Fed is prepared to provide additional monetary stimulus on Nov. 3, the day after we hit the voting booth.
“There would appear…to be a case for further action,” said Bernanke, who made it clear his other concern, aside from the dismal labor picture, is that inflation is too low, which the core consumer price index (ex-food and energy) showed on Friday to be up just 0.8% year-over-year. The Fed would like to see it closer to 2%.
The stock market actually paused after Bernanke’s comments. Since he first talked of quantitative easing, round two, in August, stocks have essentially gone straight up. Now, investors are increasingly of the mind, hey, what if it doesn’t work, buying another load of Treasuries and mortgage securities? Then what? And what does Bernanke’s continued concern say about the overall economy, given that some indicators, such as retail sales, would have you believe that activity is picking up? And what does it say about all of us that we’re letting some academic manipulate our minds in such a way that he wants us all to buy stocks and not continue to reduce our debt levels? What fonts of wisdom is he really imparting on us? Personally, I like my own instincts better than Ben Bernanke’s, despite his college transcript.
But let’s move on to the foreclosure issue. The more I read, the more I’m reminded of the problems Spain had at the height of its bubble when Brits and such were flocking to buy homes on the Costa del Sol and learned later they didn’t have proper title. Or this newsletter I subscribe to titled International Living where the stories of buying a beach house in Brazil or Uruguay always look so enticing but my first thought is, ‘What about the title? How can you trust even the locals that IL is recommending?’
But then you look at the massive fraud taking place in America and, once again, you wonder, ‘What the hell is the difference between us and them?’
And, yes, robo-signing is fraud, folks. I got ticked off when I read a Wall Street Journal editorial that said the following.
“We’re not aware of a single case so far of a substantive error. Out of tens of thousands of potentially affected borrowers, we’re still waiting for the first victim claiming that he was current on his mortgage when the bank seized the home. Even if such victims exist, the proper policy is to make them whole, not to let 100,000 other people keep homes for which they haven’t paid.”
But that’s not the point in this whole exercise! There’s a reason why you hire an attorney when you buy or sell a home, as I did in January. There’s a reason why you trust them to do the title search and other things, so at the end of the process, both parties are satisfied it was done legally. It’s been the hallmark of America’s private property rights tradition that has long set us apart from other countries and no matter how you slice it, many of these foreclosures, and sales, are not technically legal and you can’t just slough it off! Some of the cases we’re all reading about are unreal, and it’s for good reason some of the banks saw their shares taken out to the woodshed this week, like Bank of America, which has a huge pile of foreclosures that need to be reworked.
This country can’t do anything right these days! [Except for Dunkin’ Donuts and McDonald’s.]
The problem with the foreclosure mess, of course, is that there are two things recovery is hinged on…a stable housing market and an improving jobs picture and neither is occurring. All of the foreclosed properties have to be re-scrutinized by the banks and then sold and this will take months and months, and years. Heck, I had no clue that the average foreclosure was taking 478 days as it is, before this mess. It was 292 days in 2006.
And consider this. In the second quarter, 56% of all sales in Nevada were foreclosure sales; 47% in Arizona and 43% in California. So the real estate market in these states essentially stops cold until we solve the documentation problem.
One thing you will probably see, short-term, is that the median home price could get a boost as buyers shy away from distressed properties, but eventually all these foreclosures will come flooding back on the market to depress prices all over again.
And I was reading a piece by Mack DeCambre in the New York Post on some of the issues involved in the crisis and it’s easy to forget Fannie Mae and Freddie Mac guarantee nearly 90% of all mortgages originated in the U.S., and the estimated hit that the two could rack up if there was a foreclosure moratorium is another $400 billion from souring loans, on top of the $150 billion they have already lost.
Lastly, a number of commentators, including Kathleen Parker and author William Cohan, reminded us this week that no one has been found criminally liable for practices that led to the financial crisis. [Angelo Mozilo’s case was a civil one.] Cohan argues that thanks to the Financial Crisis Inquiry Commission we are getting closer to hauling in the culprits. Parker calls for a special prosecutor. We need one.
A few notes on the international scene. France has been hit by another series of strikes over President Sarkozy’s proposed pension reform, which is to be voted on by the French Senate next week. The strike spread to the energy sector and at one point all 12 of France’s refineries were shut. As I go to post there are legitimate fuel shortages developing…which is just great for an economy in recovery, isn’t it? And strikes have been called for the U.K. in November to protest austerity cuts there, while there were more strikes in Greece that closed the Acropolis. Too bad the Greek government couldn’t just release the Kraken.
In China, it appears third quarter GDP will come in at a still strong 9.0-9.5%. This week the government released figures for September exports, up 25% over last year, though below August’s 34% pace, while imports were up 24% vs. 35% in August, so further evidence of a global slowdown.
Housing prices in China for August were up 0.5% in the major cities, which is not exactly what the government wanted to see given its bank tightening program, coupled with restrictions on second and third homes.
And, separately, foreign direct investment in China was up a strong 6% in September.
Street Bytes
–Stocks rose for a sixth time in seven weeks with the Dow Jones adding 0.5% to 11062, while the S&P 500 tacked on 0.9% and Nasdaq 2.8% thanks to a $60 (11% rise) in Google’s share price on Friday following its earnings report, as well as a series of all-time highs in Apple shares, which closed the week at $314. [IBM also hit a record high this week, a level not seen since July 1999.]
But GE’s earnings report was not good in that revenues were well below expectations, and Intel’s were just so-so given that back in August it preannounced a disappointment.
–U.S. Treasury Yields
6-mo. 0.16% 2-yr. 0.37% 10-yr. 2.57% 30-yr. 3.99%
The rate on a 30-year fixed mortgage fell to 4.19%, the lowest since the 1950s, but that’s it, the bottom. In fact this week PIMCO began to sell Treasuries on expectations the Fed’s next quantitative easing initiative won’t have the desired effect. The yield on the 10-year rose from 2.39% to 2.57% this week also because of some lousy Treasury auctions that lifted yields across the spectrum, with the 30-year jumping 24 basis points.
Some would also say that after crying ‘inflation’ for the past decade it’s finally here. You know how I feel on this topic and this week’s inflation data gives a perfect example of what I’ve been talking about.
The September producer price index rose a solid 0.4%, but the core was up 0.1%. For the last 12 months, the PPI is up 4.0%, 1.6% ex-food and energy.
The September consumer price index rose 0.1% and the core was unchanged. For the last 12 months the CPI is up only 1.1%, ex-food and energy just 0.8%.
Meanwhile, commodity prices, such as wheat, sugar, corn and cotton have been soaring, but…companies are having a hard time passing the increases on to consumers and that impacts their profit margins. It also keeps the CPI down.
Every statistic is different, but the Federal Reserve, and in almost all cases the bond market, only responds to the official data, though this week you saw the first signs the bond market is truly becoming rattled as to the prospects for real inflation in the CPI.
I’m on record as saying I can’t become too concerned over inflation until labor costs rise, which aren’t.
But…whereas the Fed and the bond market are focused on official data, you and I as consumers make decisions based on everyday prices for big items such as healthcare, and college tuition, and state and local taxes; all of which are rising at a far higher rate than any CPI or even PPI data.
And this has been my bottom line…it’s this last factor that has everything to do with holding back a recovery. My health care premium jumped 19%…that’s real money…I have to cut back somewhere. If I was still a homeowner I’d be dealing with further property tax hikes and the same income stream. There is nothing on the horizon to change this dynamic. In the meantime, I said the other week I can’t get all riled up until the 10-year gets above 3.00%. However, that doesn’t mean those getting into bond funds when Treasuries were lower aren’t taking a hit to their net asset value. Be careful. Ask your financial advisor what the duration is in the fund you’re invested in to get some sense of the risk should rates spike higher. If the advisor can’t explain this to you, fire ‘em.
–The federal government has run deficits of $2.7 trillion in the first two years of the Obama administration, or more than the entire Reagan administration. And as an editorial in the Wall Street Journal points out:
“Now liberal economists tell us that deficits are the key to restoring prosperity. But all we have to show for spending nearly 25% of GDP for two years running is a growth rate of 1.7% and 9.6% unemployment.”
The deficit for the fiscal year that began Sept. 30 is projected to be anywhere from $1.2 trillion to $1.4 trillion. That’s real consistency, Obama supporters. Helluva resume the president is building.
–What a shock…the Obama administration lifted a moratorium on deep-water drilling in the Gulf of Mexico, six weeks before the suspension was due to expire, and right before the election! But it’s not as if drilling will commence any time soon as operators have to meet stringent new standards.
Only now, environmentalists are furious. The director of Greenpeace USA said, “Scientists haven’t even assessed the full ecological impact of the BP disaster and yet the Government is in a rush to allow oil companies to get back to drilling. It is irresponsible to say the least, reckless at worst.”
The White House has botched this, from all angles, since day one.
–As noted above, Google plowed through earnings estimates in reporting a 25% jump in net revenues to $5.48 billion as advertising continues to bounce back and the company’s profit margin held steady at 40%.
–The for-profit education sector was already under pressure from growing regulatory scrutiny, then on Wednesday, Apollo Group (University of Phoenix), withdrew its guidance for 2011 as it said enrollment could drop more than 40% year on year in the coming quarter. Apollo closed down 23%, while others such as Strayer fell 15%. A big issue is that the federal government is threatening to withhold funding if the colleges cannot demonstrate that their courses lead to ‘gainful employment.’
–Pfizer, the world’s largest pharmaceutical company by revenue, is acquiring drugmaker King pharmaceuticals for $3.6 billion, King being focused on pain medication, of which there is a need across the world these days.
–China’s Cnooc, one of the big three state-owned oil companies, is making a $2.2 billion investment in Chesapeake Energy, ostensibly to pick up Chesapeake’s expertise in exploiting oil and gas shale drilling technology. China has vast potential reserves of natural gas bearing shale, but nat gas comprises only 3% of China’s energy mix, vs. coal which provides 70%. The country needs to move this ratio significantly in favor of natural gas to improve its air quality.
–The catastrophic flooding in Pakistan is having an impact on cotton prices, which hit a nominal record high this week. This in turn will impact the clothing industry, which will either raise prices or see their profit margins shrink. Part of the problem is also that farmers have been moving into more profitable crops.
–The International Energy Agency is now estimating worldwide crude use will average 86.9 million barrels a day in 2010 and 88.2 million barrels in 2011, or a slight increase for both years from an earlier forecast due to recent strength in Western economies. However, IEA added, “It is unclear whether the recovery will be sustainable, notably in the United States.” [OPEC is producing around 27 mbd and is holding its quotas steady. Who wouldn’t, at $80 a barrel?]
–Iceland’s finances get worse and worse. The government promised $2 billion in debt relief for the 39% technically insolvent, but the main pension fund said ‘not so fast’ as they hold the bonds behind the mortgage debt and forgiveness would mean cuts in pensions. Plus debt relief could mean Iceland is in breach of a clause in its loan agreement with the IMF. Iceland’s sovereign debt could sink to ‘junk’ status shortly. And speaking of foreclosures, there is a moratorium here.
–The New York Times reported that with Dubai’s real estate bubble, the overall office vacancy rate is 40%, with still far more supply to be added in the next four years. Good deals can be had, sports fans!
–To give you a sense of the scope of the Irish property bubble, one particular property, Blarney Golf Resort and Hotel is comprised of 168 acres, 38 golf lodges, and a four-star 64-bedroom hotel and conference center, all built at a cost of about $45 million. It’s now on the market for less than $15 million. [Irish Independent]
–China’s Shanghai benchmark composite index rose 8.4% this week as earnings are supposed to be strong for the banking sector.
–As noted last time, I just want to relay the sentiments of Morgan Stanley Asia, Non-Executive Chairman (and economist) Stephen Roach, on China via his Barron’s interview in the Oct. 4 issue.
“I think the Chinese recognize that they need to do three things to provide broad-based support for internal private consumption. They have to build a social safety net that will allow the Chinese to reduce the excesses of fear-driven – or what economists call precautionary – savings. And the safety net has to include far more aggressive funding and social security, private pensions, unemployment and medical insurance. They’ve taken very small steps, but they need to take big steps.
“The second thing is to provide much more effective and aggressive support for lagging rural incomes. Some 750 million Chinese still live at impoverished levels in the countryside, and the income disparities have widened dramatically in the last dozen years between urban and rural China. They need to be more aggressive with tax policy, and in providing rebates to rural families. They need to rethink property-ownership rights of rural inhabitants and invest in information technology to boost agricultural activity.
“The third thing is jobs. Ironically, while China leads Asia in GDP growth, it lags Asia in job growth. From 2000 to 2008, China’s GDP grew 10% a year, but its net employment growth was just 0.5% a year. That reflected a disproportionate emphasis on manufacturing productivity, you substitute machines for people – it’s a capital-intensive, labor-saving growth model….
“If China succeeds, the consumption share of GDP could go from the current rock-bottom 35% to between 42% and 45% over the next five years. That’s still low by global standards, but a huge improvement and a big shift in the momentum of China’s structural re-balancing.”
Roach sees some of his recommendations being implemented in China’s five-year plan for 2011 to 2016, to be announced in February.
–Australia is an example of the flipside of the currency war as the Aussie dollar approaches parity with the U.S. dollar for the first time since 1983, when the Aussie currency was floated on foreign exchange markets. Aussie companies face profit issues, including as a result of soaring input costs. Hedging strategies are more important than ever.
–The U.S. Treasury holds 261.5 million of troy ounces of gold, or at the current price of the shiny metal at $1380, some $360 billion. And as Edwin Truman points out in the Financial Times, “the Treasury secretary, with the approval of the president, has the power to sell (and buy) gold on terms that the secretary considers most beneficial to the public interest. Revenues from sales must be used to reduce the national debt.” Well, you can see where this discussion is headed. You could put a dent in the debt by selling the gold, that’s for sure, but the counter argument “is that the U.S. should hold on to its stock in anticipation of the return to a monetary system based on gold itself or with other nations.” But Truman argues “It is not going to happen.”
–Car czar Steven Rattner, who oversaw the Obama administration’s overhaul of the auto industry, has agreed to settle his case with regulators over his role in New York’s pension fund kickback scheme and will be banned from the securities industry for a number of years as well as pay a fine of up to $6 million. Rattner was involved in what came to be called pay to play; paying public pension officials in exchange for Rattner’s private-equity firm securing business. Without settling, Rattner also faced perjury charges.
–And on Friday, Countrywide Financial’s former CEO, Angelo Mozilo, settled his civil fraud case with the SEC for $67.5 million. Two other former colleagues of Mozilo’s also settled, thus avoiding a trial. All three did not admit wrongdoing. I’m assuming Mozilo could still be found criminally liable down the road, but that was why he wanted to settle and avoid a trial where evidence could have been used against him in a future criminal proceeding. [I apologize ahead of time if my reasoning is wrong…don’t have the chance to read all the details before posting this.]
–Federal officials charged at least 70 Armenian gangsters with running one of the largest Medicare frauds yet uncovered (some say the largest by a single criminal enterprise) in cheating taxpayers out of $163 million by setting up phantom health care clinics. Said U.S. Attorney Preet Bharara, the scheme’s scope and sophistication “puts the traditional Mafia to shame. They ran a veritable fraud franchise.”
One of the ringleaders allegedly pulled a knife on someone who owed him money “and threatened to disembowel the individual if the debt was not paid.” [This was done at a Brighton Beach, NY, restaurant.]
–The talk on Wall Street bonuses is deceiving (as laid out in a Journal article that got national play on the newscasts), as in the story they will be at record levels. That’s just not true. Almost all compensation analysts say that at the biggest investment banks, bonuses will be down 15% to 40%. Without getting into specifics, I understand the Journal’s methodology but I think it’s deceiving.
–Christine Quinn is the liberal City Council Speaker in New York City and a woman I’ve always kind of liked (despite her politics). She’s just one who seems like she’d be fun to have a few beers with and she is a strong mayoral candidate in 2013. She’s also openly gay, which with New York’s recent rash of bias attacks has her in the spotlight for this reason as well.
But Ms. Quinn spurned her liberal allies this week when she scuttled an effort to force all employers in the Big Apple to provide workers with paid sick leave, an issue I brought up in the past few weeks.
“Providing sick leave to working New Yorkers is truly a noble goal, and supporters of this bill have the best intentions. But now is simply not the right time for a measure that threatens the survival of small businesses.”
2/3s of the Council support the measure, while Mayor Bloomberg knows it would be “disastrous” for the city. As the Wall Street Journal reported:
“The decision won kudos from the business community and scathing criticism from a coalition of liberal groups that had championed the bill as a basic worker right.”
You go, Christine! I promise to contribute to your campaign (in a modest way), assuming you stick to this position.
–My spies Ted T. and Kelly L. tell me that some room rates at the Ritz Carlton in Naples have dropped from $1179 a night to $225. “North Naples is DEAD. Many stores are closed and the malls are empty.”
–Interesting story for those of us who own Web addresses (I own a ton myself). In 2007, a fellow in London set up the site ‘I Hate Ryanair’ as a means for disgruntled Ryanair passengers to tell their horror stories, so Ryanair boss Michael O’Leary complained and authorities have ruled the address has to be handed over to Ryanair because the original owner, Robert Tyler, made money from the site, as in about $500 worth of advertising. The ruling said in part that if the domain name used a company’s brand it “must be wholly devoted to honest criticism and open discussion and not potentially tainted by commercial concerns.”
But Robert Tyler has now set up ihateryanair.org. [Irish Independent]
–e-Book sales comprise about 9% of the total book market, but, August sales were flat with those in July.
–Hurricane season has been as severe as predicted, believe it or not. Hurricane Paula was the 16th named storm and experts were generally in the 14-20 area, which is an active season. 9 became hurricanes. It’s just that many will perceive it to be a mild one because the U.S., save for Texas and some heavy rains, was spared the worst. My own hurricane bet suffered immensely as every storm threatening the Gulf veered east or west. [At least my uranium play continues to rock and I sold a 1/3rd of it at the highs on Friday.]
Foreign Affairs
Afghanistan: President Karzai said yet again he has been in discussions with the Taliban on an end to the war, but I just don’t see it; a negotiated peace that would be palatable (nor do I see a military solution any time soon…it’s a quagmire). It was also a very violent week, with 13 NATO soldiers killed Wednesday-Thursday alone, plus a bombing that killed at least 30 including a governor who was an ally of NATO.
Then you have the case of British aid worker Linda Norgrove, who was killed in a rescue attempt by U.S. Special Forces, which killed her six captors, but it wasn’t until days later that we learned a U.S. soldier had accidentally killed Norgrove himself when he tossed a grenade that exploded near her. Among the many tragic elements of this tale is that she had broken free from her captors and was lying in a hideaway but the soldier didn’t see her and threw it where she was lying.
What is upsetting is that the United States, and the British government upon hearing the initial report, relayed that Norgrove had been killed by the Taliban and one of her captors detonating a suicide vest. It wasn’t until the taskforce commander, in viewing video of the confrontation, saw the Seal toss the grenade into the compound four seconds before the blast that the soldier was confronted and confessed.
Senior U.S. commanders, including Gen. David Petraeus, were said to be greatly distressed for putting forth the initial misleading information. British Prime Minister David Cameron’s office, however, said that they were called immediately when commanders realized the video told a different story.
And for their part, Ms. Norgrove’s parents have expressed gratitude to U.S. forces for “not sweeping under the carpet” the details of their daughter’s death. The Seal will be disciplined.
Pakistan: The government reopened the Af-Pak border after an 11-day blockade in which 150 trucks were torched by the Taliban (and six drivers killed). Pakistan also apparently foiled a plot to take out its leadership with a group with links to al-Qaeda and the Taliban being responsible.
Israel: The two sides are at an impasse as the White House desperately tries to keep talks between the Israelis and Palestinians alive, with the current timeout due to the Palestinians demanding Israel reinstitute the settlement construction moratorium that expired on Sept. 26. Israeli Prime Minister Netanyahu said he would go back to the negotiating table if the Palestinian Authority recognized Israel as a Jewish state. The PA’s President Abbas counters that he wants America to recognize a Palestinian state that would include all of the West Bank, adding, “If the Israelis want to call themselves any name, they should address the international community and the United Nations, because this is none of our business.”
Abbas added the PLO had recognized Israel when the Oslo Accords were signed in 1993.
“Our position is that we recognize Israel. We fully believe in a two state solution – a Palestinian state on the 1967 borders and the State of Israel, living next to each other in peace and security.”
But Abbas won’t return to the direct talks without renewal of the moratorium, and so what happens on Friday? Israel announced plans for an additional 238 settler homes in East Jerusalem, which the Palestinians say is occupied land. The PA leadership said Israel was bent on “killing” every opportunity to revive the talks.
Meanwhile, last weekend the Israeli Cabinet approved an amendment to a citizenship law that requires new citizens to declare their loyalty to a “Jewish and democratic state,” with 22 voting for the change and 8 opposed. It now moves on to the Knesset for passage into law.
Critics say the law discriminates between Jews and non-Jews. [Israel is roughly home to 6 million Jewish citizens and 1.5 million Arab citizens.]
Netanyahu spokesman Mark Regev said, “What we are asking others to accept we have to demand of ourselves,” referring to the government demand that Palestinians recognize Israel as the nation state of the Jewish people.
Clearly, Netanyahu is doing this as a sop to the far-right in his fragile coalition, specifically Foreign Minister Avigdor Lieberman, though Netanyahu could use it to soften Lieberman’s opposition to any re-extension of the settlement moratorium.
But of bigger concern to Israelis these days should be Lebanon, and this week’s visit by Iranian President Mahmoud Ahmadinejad. Lebanon’s Shiite community was delirious, while those leading Lebanon’s other political factions were forced to grovel at his feet for more aid. There is no other way to look at Ahmadinejad’s visit to the south of Lebanon, the heart of Hizbullah territory and on the Israeli border, than to see it as an effort to extend Iran’s own border to Israel.
Addressing a crowd of Hizbullah supporters just a few miles from the border, Ahmadinejad said, “There is no option before the Zionists but to surrender to facts on the ground or return to their original countries. Palestine will be liberated through force and the belief of the resistance.”
Ahmadinejad vowed to stand by the Lebanese people in all circumstances. “You proved that your resistance, your patience, your steadfastness, was stronger than all the tanks and warplanes of the enemy.”
[One side note on Iran, its atomic energy chief acknowledged Western spies have infiltrated the nuclear program, while there have been reports Natanz (as I first thought) was indeed targeted with cyberwarfare.]
China: Beijing did its best to calm nerves at a critical Asian security conference addressing the shipping lanes of the South China and East China seas, as well as the issue of disputed islands. Defense Secretary Gates said:
“We have a national interest in freedom of navigation, in unimpeded economic development and commerce and in respect for international law….
“The United States has always exercised our rights and supported the rights of others to transit through, and operate in, international waters. This will not change, nor will our commitment to engage in activities and exercises together with our allies and partners.”
“Relying exclusively on the bilateral relationships is not enough – we need multilateral institutions in order to confront the most important security challenges in this region.”
“China pursues a defense policy that is defensive in nature. China’s defense development is not aimed to challenge or threaten anyone, but to ensure its security and promote international and regional peace and stability. Security of a country relies not only on self-defense capabilities, but also on mutual trust with others.”
Gates and his Chinese counterpart did meet in Hanoi, and further security talks were held in Hawaii.
And while the China-Japan relationship is still worrisome given the harsh rhetoric between the two on the currency front, at least Japanese Prime Minister Kan and Chinese Premier Wen will be meeting soon. Beijing also offered this week to open talks on military issues with Taiwan, another positive.
All I’ve been writing about is we have to get the various parties to sit down face to face, and not voice their differences solely through the media. At least that is now happening.
Separately, China remains upset over the granting of the Nobel Peace Prize to dissident Liu Xiaobo. I have an official government reaction on my “Hot Spots” link, but essentially China said the award shows a prejudiced West afraid of China’s rising power.
But in reading various opinion pieces from China, one fellow brought up an interesting point. Very few Chinese know just who Liu is…and many of them will now be curious to learn his story, and in this the government should be worried. As in, why did the world see fit to award this man we never heard of, a fellow countryman, such a prestigious prize? They then learn Liu was part of the pro-democracy movement at Tiananmen Square and has been in and out of jail ever since campaigning for freedom of speech and political liberalization.
Even Taiwan President Ma, despite the better recent relations with the mainland, couldn’t help but say, “If Liu Xiaobo can regain freedom, I believe the Taiwanese people would very much appreciate China’s move.”
It’s a fascinating topic and you can imagine the discussions going on in Beijing as top Communist Party leaders gathered this week for a key meeting to discuss all manner of issues.
Lastly, UN climate talks held in China were an unmitigated disaster and zero progress was made ahead of a larger conference next month in Cancun.
Europe: First France was criticized for its anti-Gypsy (Roma) policies as it deported 1,000, but now Milan, Italy is doing the same with its Roma population as it dismantled the largest Gypsy camp, with officials decrying it as a den of thieves in yet another sign that, as I said would be the case with the Great Recession, immigrants are becoming the scapegoat.
Benjamin Ward, the Europe deputy director for Human Rights Watch in London, told the Washington Post:
“There is a worrying trend in Europe in which we are seeing the embrace of populist policies. They are creating a new climate of intolerance in Europe with movements in some countries now openly hostile to ethnic minorities and migrants.”
Serbia/Kosovo/Bosnia: When I was in Albania this spring, I told you to watch this area because it’s a potential flashpoint…not that it would be a market-moving event (the U.S. stock market kept rising merrily higher in the 1990s during the Kosovo conflict, for example, and the Balkan War). It’s just that it wouldn’t be good for consumer confidence in Europe, I imagine, if things flared up anew and this week Secretary of State Clinton was in the region warning Bosnia and Serbia to cool their jets as ethnic feuding and violence has begun to percolate to the top again. In Bosnia, for example, a hardline nationalist Serb has talked of war and declaring an independent republic in the Serb region of the country. Serbia was warned by Clinton not to encourage the guy, Milorad Dodik.
To refresh your memory, 100,000 died in the Balkan conflict. 2,000 NATO soldiers have died in Afghanistan. It’s Northern Ireland and its “Troubles” magnified 30- or 40-fold if it gets going again. There was a Gay Pride parade in Belgrade (Serbia) for example last weekend and 100 were hurt when anti-gay protesters fought running battles with police. Unemployment in the region is still a huge issue and the gangs are as vicious as any in the world. With nothing to do, might as well pick a target and beat the hell out of them, or so the attitude seems to be. Gays, Serbs, Kosovars (who are largely Albanian), you name it.
Want one more example of the simmering tensions across all of Europe? A Euro 2012 football qualifier between Italy and Serbia had to be canceled after traveling Serb fans in Genoa threw flares at Italy supporters before the game, as well as on to the pitch. After a 45-minute delay, the match finally got underway and then the violence resumed.
But wait…there’s more! While I love Vienna, and can’t wait to get back, maybe next year, if you look for it there is a certain uneasy feeling below the surface, which I saw my first time there, 1999 (first time since I was a kid, that is), when I hopped on a commuter train and took it to the end of the line, out into the suburbs. I was going to hike in a national park but in walking around the neighborhoods on the outskirts of it, and in peering into a bar near the train station and spying the ugly looking characters inside, I was spooked out. It was as if I could smell Nazism in the air.
Anyway, Austria’s far-right Freedom Party (think the late Jorg Haider) won more than a quarter of the vote in Vienna city elections last weekend in yet another sign of anti-immigrant fervor across Europe.
Britain: Secretary of State Hillary Clinton expressed dismay at pending British defense cuts, warning it could damage the NATO alliance. She’s right. With Europe’s austerity kick, defense is an easy target and no doubt behind closed doors European politicians are all saying the same thing, ‘If we have a really big problem, the U.S. will be there to help.’ But as both Clinton and Defense Secretary Robert Gates know, the United States has its own budget pressures, let alone a public that, if they knew the full story, would say the hell with Europe. It’s long time they defend themselves! Of course you can’t ignore treaty obligations, but no one ever said the politicians wouldn’t make hay out of the issue. Many experts in Britain, meanwhile, blame President Obama for neglecting Europe.
Indonesia: This is scary, if you happen to be going here on vacation. 100 people have been killed in a rabies outbreak on the island of Bali. Local officials have been slow to institute a vaccination campaign but several countries, including the U.S. and Australia, are now providing aid. The issue is the hundreds of thousands of stray dogs, 200,000 of which were killed because the government said it couldn’t afford to vaccinate them. For now, the best advice for travelers is to stay clear of dogs roaming the beaches, which is hard to do.
Mexico: I believe the story of the American, David Michael Hartley, who was killed on Falcon Lake between Texas and Mexico, has legs after the beheading of the lead Mexican investigator; Rolando Flores Villegas’ head having been delivered in a suitcase to the Mexican military.
This cannot continue and must stop at some point. Did you know 50 Americans have been killed in Mexico this year alone? I believe U.S. troops are going to become involved at a certain level, far more so than they already are (secretly), following a major summit between our two leaders that I expect will take place in January, or possibly sooner. The cartels have to be sent a powerful message. I’ll leave it at that for now.
Chile: As President Pinera’s popularity soars following the successful conclusion to the mine rescue, he promised that while it was impossible to guarantee such an accident would never happen again, “we can guarantee one thing: never again in our country will we allow working conditions so inhumane and so unsafe as happened in the San Jose mine and many other places in our country.” Pinera promised a review of not just the mining industries, but also transport, fishing and construction.
“The original Chilean Coat of Arms was designed for President Jose Miguel Carrera, in 1812. It depicted a globe on top of a column representing the Tree of Freedom. A Chilean man and woman stood proud sentry on either side and over the top of the image were inscribed the words ‘Post Tenebras Lux.’ After the darkness, light.
“Seventeen days after the mine shaft of the San Jose gold and copper mine in Copiapo had collapsed, 33 miners had been given up for dead….Then, miraculously on August 22, one of their number, Jose Ojeda, with poetic economy of expression, informed the world that the mine had not consumed them yet: ‘We are all well here in the refuge – the 33.’ Yesterday, the world looked on as Operation San Lorenzo, the mission named after Chile’s patron saint of mining, lifted the men out of the dark, 2,000 feet below the surface of the northern Atacama desert….
“When the rescue capsule opened for the first time, Florencio Alvalos was greeted by his 7-year-old boy Bairon. On the first sight of his father for more than two months, Bairon came forward, hugged his dad and began to cry. And then, after the tears, the sound of laughter. In the words of the nation’s most renowned poet, Pablo Neruda: ‘My struggle is harsh and I come back with eyes tired at times from having seen the unchanging earth, but when your laughter enters it rises to the sky seeking me and it opens for me all the doors of life.’”
“The Chilean miners’ rescue from a 69-day ordeal was an enthralling story in many of its aspects…(But we) found it inspiring for what it said about Chile, and the rewards it has reaped from a 20-year record as Latin America’s most-free country.
“Brazil and Venezuela get much of the attention that has been directed at South America in recent years – the former for its supposed emergence as a global economic giant and the latter for its alleged commitment to ‘21st-century socialism.’ It’s not often enough recognized that Chile, which has embraced free markets and free trade to a far greater extent than has Brazil, has grown twice as fast over the past two decades and become far richer and more competitive in world markets.
“Chile has also done a far better job attacking its poverty than Venezuela and other nations that claim that as their first priority: It has halved its poverty rate twice since 1987 and now counts less than 20 percent of its population as poor, compared with nearly 40 percent in Venezuela and 31 percent in Brazil. Politically, its democracy has produced pragmatic and effective governments and a robust free press.
“All that explains why the rescue of 33 miners trapped more than 2,000 feet below ground in the middle of a desert could succeed. The government of President Sebastian Pinera, a successful entrepreneur, quickly committed itself to the politically risky goal of saving the trapped men. Thanks to Chile’s openness to the world and embrace of entrepreneurship, it was able to effectively deploy cutting-edge technologies. There were special cellphones from Korea, flexible fiber-optic cable from Germany and advice from NASA on the construction of a rescue capsule. Perhaps most significant, a private mining company with Japanese and British investors paid for the U.S.-manufactured drilling rig and drill bits that managed to penetrate through rock in record time.
“The world was riveted by the extraction of the miners on Wednesday in large part because more than 750 journalists traveled to the site from around the globe, taking advantage of Chile’s media freedom. Most of those who watched were no doubt focused on the emerging miners. But let’s hope they learned a little as well about an emerging Latin American success story.”
“Chile! Viva Chile! If had your flag, I would wave it today from the roof of my building, and watch my New York neighbors smile, nod and wave as they walked by. What a thing Chile has done. They say on TV, ‘Chile needed this.’ But the world needed it. And the world knew it: That’s why they watched, a billion of them, as the men came out of the mine.
“Why did the world need it? Because the saving of those men gave us something we don’t see enough, a brilliant example of human excellence – of cohesion, of united and committed action, of planning and execution, of caring. They used the human brain and spirit to save life. All we get all day every day is scandal. But this inspired.
“Viva Chile. They left no man behind. That is what our U.S. Army Rangers say, and our Marines: We leave no man behind. It has a meaning, this military motto, this way of operating. It means you are not alone, you are part of something. Your brothers are with you, here they come. Chile, in leaving no man behind, in insisting that the San Jose mine was a disaster area but not a tomb, showed itself to be a huge example of that little thing that is at the core of every society: a fully functioning family. A cohering unit that can make its way through the world….
“Viva Chile. So many speak faith but those miners, they had faith. A miner’s relative, as the men began to come up: ‘It’s a miracle from God.’ A miner got out of the capsule and got on his knees in front of the nation, saying prayers you know he promised, at the bottom of the mine, he would say, crossed himself twice, and holding up his arms in gratitude, surrender and awe. A miner, after he walked out of the capsule, described his personal experience: ‘I met God. I met the devil. God won.’
“So many nations and leaders have grown gifted at talk. Or at least they talk a lot…But Chile this week moved the world not by talking but by doing, not by mouthing sympathy for the miners, but by saving them. The whole country – the engineers and technicians, the president, the government, the rescue workers, other miners, medics – set itself to doing something hard, specific, physical, demanding of commitment, precision and expertise. And they did it….
“A government of a mature and complex democracy proved itself capable and competent. This was heartening and surprising. Governments are charged with doing certain vital and necessary things, but they are overburdened, distracted, so we no longer expect them to do them well….
“It was the opposite of the governor of Louisiana during Katrina, projecting helplessness and loserdom, or the president flying over the storm, or the mayor holing up in a motel deciding this might be a good time for a breakdown. This [President Pinera] was someone taking responsibility….
*I’d love to be able to say I’m going back to Chile (I was there in 2004) to spread some dollars around next year but we’ll see what happens. One thing all of us can do, though, especially if you live in an urban/metro area like I do, is go to a Chilean restaurant and give them some business.
So before Christmas, I promise to go to Zapallar Restaurant, 7815 Bergenline Avenue, North Bergen, N.J. (201) 868-8893. I called them the other day, the fellow answered in Spanish, I asked for the hours (Noon-10:00, Mon-Thurs., noon-11:00, Fri-Sat., and noon-9:00, Sunday) and it was like he instantly knew the purpose of the call was a little more than finding a place to eat. Americans, and people around the world, should be flooding Chilean restaurants as a small way of giving thanks for the example their people set. And if enough of us do it, maybe we’ll save a few jobs in the process.
Random Musings
–Defense Secretary Robert Gates has yet to telegraph exactly when he’s leaving next year. This is about the only guy I respect in Washington and I believe it is critical he at least stay on until he can finish smoothing things over with his counterparts in China, which he has begun to do. Some believe he is looking at July 2011, which President Obama set as the date for the start of the withdrawal from Afghanistan. Regardless, it will be a sad day when Gates decides to depart.
–Related to the above, the Washington Post’s Jackson Diehl wrote in his op-ed of how “Obama’s foreign policy record hardly figures in this fall’s midterm election. That’s at least in part because of its inconclusiveness: It has neither failed nor produced tangible outcomes. A year from now, thanks to the timetables, the record should be in – just in time for the 2012 presidential campaign.”
Yes, the president has essentially set timetables for Afghanistan, Iraq, Iran and the Israeli-Palestinian talks. But as Diehl says, “they are setting him up for failure.”
“The timetables are disconnected from a strategy. Is it possible that Netanyahu and Abbas can agree on the borders of a Palestinian state in less than 60 days and end the settlement debate? No. But then, what will happen when the next deadline arrives? Discussion will be forced on yet another timetable.
“Process is always important to good policy – and yes, the Bush administration sometimes demonstrated what can go wrong when there are no deadlines. Yet in the Obama administration, the timetable is becoming an end in itself. It reflects a president who is fixed on disposing of foreign policy problems – and not so much on solving them.”
–An AP-mtvU poll found that 44% of college students approve of the job President Obama is doing, while 27% disapprove. In May 2009, 60% gave Obama high marks and only 15% had a negative opinion. [34% of white students approve of the president’s performance today, 37% disapprove. In May 2009, it was 53-21 for. 58% of Minority students, on the other hand, give Obama high marks vs. 13% who don’t…pretty similar to last year.]
–So Republican gubernatorial candidate Carl Paladino of New York reads a statement in front of a gathering of Orthodox Jews in Brooklyn that children should not be “brainwashed into thinking that homosexuality is an equally valid and successful option,” he apologizes, several times, saying some of his remarks were “misinterpreted,” and then the very same Orthodox Jew leaders he was courting said they wouldn’t support Paladino because he went back on his original statement. That pretty much sums up the not-ready-for-prime-time Paladino campaign.
–Then you have this exchange from the final debate between California gubernatorial candidates Jerry Brown (Dem.) and Meg Whitman (Rep.), a Brown aide having described Whitman as a “whore” during a strategy session that the former governor and staff didn’t realize was being recorded.
“Moderator Tom Brokaw…told Brown that the word represents, to many women, the same sort of insult that ‘the N-word’ represents to African Americans.
“Brown at first said he did not agree with the comparison – a statement that drew an audible reproach from the crowd – and sought to question the timing of the release of the ‘5-week-old private conversation…with garbled transmission.’
“ ‘I will say the campaign apologized promptly and I’m affirming that apology tonight,’ he said.
“ ‘You’re repeating it to Ms. Whitman?’ Brokaw asked.
“Whitman, however, told Brown that Californians ‘deserve better than slurs and personal attacks.’
“ ‘I think every Californian, and especially women, know exactly what’s going on here and that is a deeply offensive term to women,’ she said.
“Brown asked Whitman if she had similarly chastised her campaign chairman, former Gov. Pete Wilson, who used the same term in a criticism of Congress.
“ ‘You know better than that, Jerry; that is a completely different thing,’ she said, a retort that drew another rumble of reaction from the crowd. ‘The fact that you are defending your campaign for a slur and a personal attack on me – it’s not befitting of California, it’s not befitting of the office that you are running for.’
“Brown apologized a third time…” and we could go on and on and on….
“Just when millions of Californians began tuning in to the upcoming elections, the candidates running for office appeared last week to have wandered onto a different planet, where they speak in tongues and reality is situational.
“As the Legislature and Arnold Schwarzenegger came to terms on a budget that will dump pain into his successor’s lap, little was heard about it from either candidate for governor. They were talking, through aides and statements, about illegal immigrant housekeepers and insulting language, not the state’s feeble state. And the candidates running for the U.S. Senate were not much different.”
–Meanwhile, in neighboring Nevada, Republican Senate candidate Sharron Angle has raised more than $14 million in three months in her bid to oust Majority Leader Harry Reid. From what I’ve seen, I am not a fan of Ms. Angle. I am far less of a fan, though, of Reid. The cash haul is significant, though, in that it took Reid 18 months to raise that amount. Angle has a slim lead in most polls, which means she’ll win given the enthusiasm quotient among her supporters.
–In New Jersey, Republican Gov. Chris Christie’s approval rating is 51%, higher than after he submitted his first budget when it was 43%. 51% may sound relatively low, but in my state with its heavy Democratic plurality, it’s high. And as to the tunnel project between New Jersey and New York that I wrote of last time, Transportation Secretary Ray LaHood and Christie sat down after Christie said he was going to pull his state from it. Afterwards, LaHood acted like Christie was rethinking his decision, while Christie said LaHood presented several options for salvaging it. “The fact that the ARC project is not financially viable and is expected to dramatically exceed its current budget remains unchanged.”
“There are many good reasons to proceed with the tunnel.
“It is becoming ever more clear that Chris Christie is the only adult in public life in the Garden State – or maybe the entire tri-state area, for that matter.
“Whether he’s tough enough to stand up to pressure of the sort now being brought to bear is an open question.
“But he needs to know that his friends and well-wishers are legion – if not quite so energized and self-interested as those who believe a little thing like no money should be allowed to get in the way of business as usual.
–I watched the Christine O’Donnell-Chris Coons Delaware gubernatorial debate the other night on CNN and boy I’ve gotta tell ya, the people of Delaware really have one lousy choice between these two. I do not in the least respect O’Donnell, but never having seen Coons before, he is hardly a likeable sort himself…as in what an a-hole.
Note to my fellow Republicans in Delaware. Some of the polls have the Senate turning out 50-50, assuming O’Donnell boils in her witches’ cauldron on Nov. 2. That would suck when Mike Castle was a lock to win.
I heard an idiot analyst on CNN say earlier in the day that it doesn’t matter if the Republicans only gain enough seats to fall short, say 51-49, because they’d easily have a veto proof number. But the guy was quickly corrected by another CNN analyst (Dana Bash), who said you want the 51-49 because you then set the agenda, which is critical in the Senate. Bang on, Dana.
–The bottom line this November, with the Tea Party having successfully roiled the waters, is that each race is so different. I saw on Thursday that the latest poll in Connecticut, for example, has Linda McMahon trailing her Democratic Senate opponent Richard Blumenthal by double digits after narrowing the gap recently. I believe Ms. McMahon, despite her rather interesting business career, would make for a solid senator, while at the same time I can’t fathom how Connecticut residents could stomach the lying Blumenthal (who has constantly falsified his Vietnam record over the years).
At the same time, I can’t believe New York Republicans chose Carl Paladino, but then in the entire state, they couldn’t come up with a better alternative than Rick Lazio?! Puh-leeze. Andrew Cuomo deserves to win in a walk.
Sharron Angle is deeply flawed, but Harry Reid has to go.
So in these races my vote would go for McMahon, Cuomo, my Uncle Conrad (former professor at the University of Delaware…just because I don’t see how you could vote for either O’Donnell or Coons), and Angle.
In other words, of the eight choices maybe two are palatable. That’s the state of American politics today.
And we have a president who is flopping around like one of those wall flounders squawking, “Get fired up! Get fired up!”
About what? The country is headed in the wrong direction! I’ll move to Chile, thank you, and become a wine drinker.
–Larry King had Michael Moore on after the last miner in Chile was brought up and while I am hardly a Michael Moore fan, he did point out that what Chile accomplished, while remarkable, also shows how pathetic we (read the Obama administration) were in that it took us 3 months to plug a 7-inch hole in the Gulf, and it was just oil! [If I were a Republican candidate running against a Democratic incumbent in the Gulf States, I’d get a hold of that tape and run with it. Then at the end of Moore’s comment I’d get on and say, “Mississippians, we can do better, and with your help on Nov. 2, we will.”]
–In this year of pitiful wannabes, you have this Republican congressional candidate from Ohio, Rich Iott, who has worn a Nazi uniform while participating in World War II re-enactments. Iott said, “I don’t see anything wrong about educating the public about events that happened.”
OK, two comments. I never, ever heard of WWII re-enactments. Who the heck would waste their time with this? Who would watch? Civil War re-enactments? Of course. Makes sense, if you’re into that kind of thing.
But why would you even think you are educating a single soul when all any kid needs to do, for instance, is pop in “Saving Private Ryan,” “Band of Brothers,” or “The Pacific”?
It’s not that Iott wore a Nazi uniform at something like this, it’s the flat-out stupidity of the overall idea.
–Last week I had nothing to say about the firing at CNN of anchor Rick Sanchez, but now I have to note a brilliant comment by Susan Milligan in U.S. News Weekly. It totally echoes my feelings on Sanchez, who I always thought was a total tool.
“The first time I saw Rick Sanchez on TV, I thought he was brilliant. Of course, at the time, I thought he was a new addition to Saturday Night Live, and that I was watching a brutal caricature of the personality-centric, faux-intimate performances that characterize too much of cable TV news….The problem isn’t that news executives belittled Sanchez because he’s Cuban-American. It’s that they didn’t belittle him – and keep him out of the anchor’s chair – for the right reason: He wasn’t very good. Networks have become so caught up in ‘branding’ reporters that they forgot the more important truth. Walter Cronkite didn’t start out reports on the Vietnam War by chummily saying, ‘You’re not going to believe this!’ Even (Jon) Stewart, who doesn’t present himself as a straight newscaster, does Sanchez’s job better.”
–Long-time Moscow Mayor Yuri Luzhkov was booted from office recently (and just replaced by a Putin crony) and now some of his policies are being abandoned as well, such as there will no longer be experiments to blast rain and snow clouds from the skies. Luzhkov, you’ll recall, constantly tried to prevent bad weather from impacting important holidays and big parades on Red Square.
Heck, I specifically went to Moscow my last two times in November so I could get a taste of the Russian winter, and, boy, last time it snowed every day. I loved it.
–The biennial “Living Planet Report” by the Zoological Society of London and WWF notes that Man is plundering the Earth’s natural resources at an ever-increasing rate. Demand for the resources has doubled just since 1966.
The scientists studied 8,000 populations of 2,500 species and also measured changes in land use and water consumption in every part of the world. As reported by the London Times, species in temperate regions are actually faring very well, thanks to greater conservation and improvements in pollution and waste control.
“But in the tropics, the index has fallen 60% since the 1960s. Populations of freshwater tropical species showed the greatest decline, falling by nearly 70%.”
Some species have fallen at least 6% a year; like leatherback turtles in Costa Rica, whale sharks in Australia, and Atlantic bluefin tuna.
One need only look at how cod stocks collapsed in Newfoundland in the 1980s, and while people are often able to shift their sourcing, “at current consumption rates, these resources will run out too, and some ecosystems will collapse even before the resource is completely gone.”
There is a conference being held in Japan this coming week to address these concerns.
“Mauricio Pino was working late that night in early August when he got the phone call: ‘There’s been an accident at the San Jose mine.’
“The boyish-looking Chilean engineer remembers rushing to the mine in the bitter cold of the Southern Hemisphere winter. When he got there, dust was still pouring from the entrance to the shaft and he didn’t know whether the 33 miners had survived the 600,000-ton cave-in nearly half a mile below ground.
“Pino remembers the early, gloomy days of the search, when initial drilling failed to find any trace of the men. Four psychics the government had hired to help find them said, ‘Forget it, they’re all dead.’
“Two weeks later, with the men still missing, Pino remembers the mood among rescuers being so bleak that one of the contingencies being drawn up had them ‘building a white cross over the mine and walking away.’
“But Pino, who, as the Mining Ministry’s regional director, has been point man for the rescue since Day 1, was determined to find the men.
“It took what the burly 40-year-old calls ‘a miracle.’
“On the night of Aug. 22, a full 17 days after the mine collapse, a drill probe reached a chamber that the men had used as a lunchroom. Pino listened with a stethoscope and heard rhythmic hammering.
“ ‘I said to myself,’ ‘That’s not falling rock,’’ Pino said.
“When the probe was raised, there was a letter glued to the bottom of the drill bit. It read: ‘We’re fine in the refuge, the 33.’
“In a video officials made of that moment, Pino can be seen in his blue jacket and hard hat, kneeling down to pray. The desperation and the sleepless nights were over; the rescue, to his mind, now was just a matter of time.
“ ‘Until that moment, we had had nothing but disappointments and the outlook was only getting worse,’ Pino said.
The Chilean government then hired three teams to compete to be the first to dig a hole wide enough to accommodate the Phoenix, the rescue capsule. The winning company proved to be Geotech, which had a U.S.-made drill and early Saturday, they punched through near the miners’ workroom.
As the mission to bring the miners to the surface was close to getting started, Pino said:
“We achieved two important things through this ordeal. The miners maintained discipline, strength and hope. But those of us outside also have accomplished something very difficult.”
Yes, Viva Chile!
—
Pray for the men and women of our armed forces, and all the fallen.
God bless America. May some of us learn from Copiapo.
—
Gold closed at $1372…further highs
Oil, $81.25
Returns for the week 10/11-10/15
Dow Jones +0.5% [11062]
S&P 500 +0.9% [1176]
S&P MidCap +1.0%
Russell 2000 +1.3%
Nasdaq +2.8% [2468]
Returns for the week 1/1/10-10/15/10
Dow Jones +6.1%
S&P 500 +5.5%
S&P MidCap +12.8%
Russell 2000 +12.4%
Nasdaq +8.8%
Bulls 47.2
Bears 24.7 [Source: Chartcraft / Investors Intelligence…on 5/4/10 (indicator is as of Tues., published early Wed. a.m.), the spread was 56.0/18.7 and the S&P around 1200, at which point it dropped to the 1030 area…that’s how this is supposed to work in terms of being a contrarian indicator.]
Thanks for your support. I’m off today on a long trip and hope to come to you from Yap, Micronesia, next week. But…I also don’t expect the Internet service I’ve been promised, plus sometimes the power there is spotty (this is my fourth trip to Yap), so…if you don’t see a column at the usual time, I’ll have a message from somewhere in the Pacific on Sunday.
