For the week 11/17-11/21

[Posted 4:30 PM ET, Friday]

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Edition 1,387

As we enter the holiday season, President Donald Trump is in the process of totally selling out Ukraine.  As discussed in detail below, his new 28-point peace proposal is a gift to Vladimir Putin and puts Ukrainian President Volodymyr Zelensky, already dealing with a big corruption scandal enveloping his administration, as well as new losses on the battlefield and a crippling energy crisis heading into winter, under immense pressure.

As a half-dozen analysts at the Washington-based Institute for the Study of War warned atop their latest battlefield assessment, the “plan amounts to Ukraine’s full capitulation to Russia’s original war demands.”

“There are no provisions in the reported peace plan in which Russia makes any concessions, and ISW continues to assess that accepting Russian demands would set conditions for renewed Russian aggression against Ukraine,” the analysts add.

“The Kremlin continues to use a combination of economic incentives and nuclear saber-rattling to extract concessions from the United States to normalize U.S.-Russian relations without making reciprocal concessions to end the war,” ISW writes.

Today, Trump set a deadline of next Thursday for Zelensky to accept the ‘deal.’  There is no way Zelensky can accept it.

The plan is beyond absurd. It literally asks nothing of Russia.

Russia’s war on Ukraine is an easy one to understand.  It’s Good vs. Evil.  Americans have a president siding with the latter. History will not treat Donald Trump well.

—

Wall Street and the Economy

We finally had some economic data post-shutdown, a jobs report for September, as put out by the Labor Department, and payrolls rose 119,000, well above consensus of 50,000.  But August was revised down from 22,000 to a loss of 4,000, and July’s payrolls were revised slightly lower to a 72,000 gain.

The unemployment rate rose slightly to 4.4% when it was expected to remain unchanged at 4.3%.  Average hourly earnings rose 0.2%, 3.8% vs. a year earlier.

Alas, we won’t have any October jobs data, nor an inflation report for the month, and the November jobs report isn’t being released until after the Federal Reserve’s next meeting, Dec. 9-10…the report issued Dec. 16.  That one will contain elements from October.

The actual unemployment rate was 4.44%, so a tick from 4.45%, which would have been rounded up to 4.5%…and 4.5% is the level the Fed considers “cautionary.”

Earlier in the week we received the minutes from the Open Market Committee’s Oct. 28-29 meeting, and many Fed officials said it would likely be appropriate to keep interest rates steady in December.

“Many participants suggested that, under their economic outlooks, it would likely be appropriate to keep the target range unchanged for the rest of the year,” the minutes said.

Still, several participants said another cut in December “could well be appropriate in December if the economy evolved about as they expected” before the next meeting.

The minutes underscored the uncertainty around the likelihood of a cut next month given the ongoing divisions on the committee over whether inflation or unemployment represents a greater threat to the U.S. economy.

But then today, Fed Vice Chair John Williams, an influential voice, said he sees room for a further adjustment in the funds rate, stocks and bonds rallied, and the odds of a December rate rose to 66%, last I saw.

Meanwhile, President Trump on Wednesday doubled down on his criticism of Fed Chair Jerome Powell for not lowering interest rates more quickly, saying: “I’ll be honest, I’d love to fire his ass,” Trump speaking at a Saudi Arabia-backed investment forum in Washington.  He urged Treasury Secretary Scott Bessent to accelerate the hunt for a successor for Powell, whose term as Fed chair ends in May.  His term as Fed governor ends in 2028.

“You’ve got to work on him, Scott.  The only thing Scott’s blowing it on is the Fed,” Trump said.  “The rates are too high, Scott, and if you don’t get it fixed fast, I’m going to fire your ass,” the president seemingly saying this in jest.

Separately, existing home sales in October rose 1.2% over September to an annual rate of 4.1 million, the highest level since February, according to the National Association of Realtors.  Year-over-year sales rose 1.7%.

The median existing-home price was $415,200, a 2.1% increase from a year earlier, NAR said.

I haven’t seen what economic data could be released next week.

The Atlanta Fed’s GDPNow barometer for third-quarter growth was restarted this week, when last time they told us they were suspending it until the government released its own Q3 estimate, but, alas, the folks in Atlanta did raise their own forecast to 4.2%.

Freddie Mac’s 30-year fixed-rate mortgage continued to tick up to 6.26%.

—

Last Friday, President Trump moved to lower tariffs on beef, coffee, bananas, tomatoes and dozens of other agricultural and food goods, marking a significant rollback of his so-called reciprocal levies as he looked for ways to address Americans’ concerns about the cost of living.

Public opinion is the immediate worry, following recent Democratic electoral victories in Virginia and New Jersey that were fueled by Americans’ ire over the issue of affordability.  By a nearly 2-to-1 margin, registered voters disapproved of the president’s tariffs in a recent Washington Post-ABC News-Ipsos poll, which is a signal for next year’s midterm elections.

A White House spokesman said the president was pursuing “a nimble, nuanced, and multifaceted strategy” on trade.

“President Trump’s tariffs are leveling the playing field for American workers and securing trillions in investments,” said spokesman Kush Desai.

Editorial / Wall Street Journal

“President Trump insists his border taxes aren’t raising prices, but Treasury Secretary Scott Bessent more or less conceded otherwise on Wednesday when he floated exemptions for coffee and bananas. Is this the beginning of political wisdom?

“Perhaps it’s sinking in at the White House that Americans aren’t happy about the economy and high prices…

“The tariff costs are hitting home, literally. Prices have increased 6.9% for bananas and 18.9% for coffee over the past 12 months, according to government figures.  Who wouldn’t be cranky about paying $6 for a dark roast cup of joe? Trump officials say exporters pay the tariffs, but consumers see the opposite each day at Starbucks.

“Businesses have been passing on the border taxes to consumers to varying degrees.  Some are also slowing hiring and putting investments on hold because of tariff uncertainty. Consumer sentiment on the University of Michigan’s survey last week fell to a near record low – near the same level when inflation peaked at 9.1% in June 2022.

“Americans who own stocks are feeling good about their finances, but everyone else not so much. This is why Americans disapprove of Mr. Trump’s handling of the economy by a 14-point margin, according to the Real Clear Politics average. They also rate him poorly on trade (-14 points net disapprove) and inflation (-17 points) in the latest Harris Insights & Analytics survey.

“This is especially notable since Americans elected Mr. Trump in large part because they hoped he would deliver broad economic prosperity as he did in his first term. He won 81% of voters who rated the economy as the most important issue, and he started his Presidency with positive marks on the economy and consumer confidence riding high.

“Views of his handling of the economy started to slide in February when he launched his tariff barrage on Canada and Mexico. They have continued on a downward slope. Mr. Trump said [last] week that the ‘polls are fake. We have the greatest economy we’ve ever had.’  That’s what the Biden team said as inflation raged.

“The Administration’s pollyannas keep saying that the sun will come out tomorrow. Just wait – you’ll see.  ‘American people are going to start feeling better’ by the first half of next year, Mr. Bessent said.  We hope so.

“Mr. Bessent also blamed the Biden crowd for the ‘affordability mess,’ which is true as far it goes.  But Mr. Trump’s tariffs are making daily life less affordable now.  Americans want a tariff reprieve for more than coffee and bananas.”

Meanwhile, a CBS News and YouGov poll, conducted between Nov. 13 and 14, found that 55% of Americans believe President Trump and Republicans got more of what they wanted from negotiations that ended the shutdown.  Only 6% said Democrats came out on top, 15% said both equally, and 24% said neither party was victorious.

Europe and Asia

We had flash PMI readings for November in the eurozone, curtesy of S&P Global/Hamburg Commercial Bank, and the composite reading was 52.4, with manufacturing at 50.5, services 53.1 (18-month high).

Germany: manufacturing 50.7, services 52.7
France: mfg. 45.2; services 50.8

UK: mfg. 50.6; services 50.5 (7-mo. low)

Dr. Cyrus de la Rubia, Chief Economist Hamburg Commercial Bank:

“For months the manufacturing sector of the eurozone has been marooned in a no-man’s land of directionlessness.  Production has picked up slightly since March of this year, but the overall situation has not improved during this period.  Companies continue to face weak demand, which is reflected in a slight decline in new orders. In this environment, companies have reduced their inventories of both intermediate goods and finished goods even more sharply than in the previous month, meaning that the inventory cycle continues to show no signs of turning upward.  We are still several months, and possibly even several quarters, away from sustained expansion in the manufacturing sector.”

Eurostat reported October’s annual inflation rate in the euro area was 2.1%, down from 2.2% in September. A year earlier the rate was 2.0%.  Ex-food and energy it was 2.4%, unchanged from the prior month and vs. 2.7% in Oct. 2024.

Annualized Oct. inflation rate….

Germany 2.3%, France 0.8%, Italy 1.3%, Spain 3.2%, Netherlands 3.0%, Ireland 2.8%, Greece 1.6%.

In the UK, inflation fell for the first time in seven months, a sign price pressures are past their peak ahead of crucial decisions by the Bank of England and Chancellor of the Exchequer Rachel Reeves.

Consumer prices increased 3.6% in October compared with a year earlier, down from the 3.8% rise in September, the Office of National Statistics said on Wednesday.  This is the lowest rate of inflation since June, owing to energy prices rising by less than they did in October 2024.

The figures keep alive hopes of the UK central bank delivering a pre-Christmas cut at its next meeting after skipping a move earlier this month.

The European Commission issued its twice-yearly report on the economic outlook and it now expects GDP across the eurozone to rise by 1.3% this year, up from a prior forecast of 0.9%, and against a rise of 0.4% in 2024.

The forecast for 2026 was revised marginally down to 1.2% from 1.4%.

In Asia…no significant economic data from China this week.

Japan reported a preliminary view of third-quarter GDP, down 1.8% on an annualized basis vs. growth of 2.3% in the prior quarter.  Minus-0.4% quarter-over-quarter.

Flash PMI readings for November showed manufacturing at 49.6; services 53.1.

October exports were up 3.6%, imports 0.7%.

October inflation was 3%, 3.1% ex-food and energy.

September industrial production was up 3.8% Y/Y.

Street Bytes

–It was a crazy week, computer trading (algo’s) taking control more than normal at times, like Thursday and Friday, and in the end, the major indexes fell, the Dow Jones losing 1.9% to 46245, the S&P 500 2.0% and Nasdaq 2.7%.  Bitcoin’s ongoing collapse didn’t help.

Markets have been flummoxed after big tech companies projected massive capital expenditures that are increasingly reliant on issuing huge piles of debt.  Traders’ trepidation has sent Wall Street’s fear gauge – the VIX – to some of its highest levels since April’s tariff announcements.

Amazon, for example, is set to issue $15 billion in bonds, giving Wall Street a “peek under the hood” of the expensive and sometimes circular deals that are proliferating.

Actually, since September, public bond issuance by four of the major cloud computing and AI platform companies known as “hyperscalers” has hit nearly $90 billion, with Alphabet selling $25 billion in bonds, Meta $30 billion, and Oracle $18 billion, as well as Amazon’s $15bn.

For now it’s mainly about the market’s ability to absorb the surge in supply together with growing anxiety over AI-related spending.

—U.S. Treasury Yields

6-mo. 3.77%  2-yr. 3.51%  10-yr. 4.06%  30-yr. 4.71%

The 2- and 10-year rallied big today ostensibly on the comments of Fed Vice Chair Williams, but we need a lot more data.

—Crude oil fell end of the week, after President Zelensky signaled a willingness to pursue peace talks.  The blueprint includes the lifting of sanctions on Moscow, which could open the door to higher Russian oil exports and increase oversupply concerns.

It’s difficult to turn a profit for many in the oil industry now with prices around $60.  Nationally, oil and gas production employment has dropped by 4,000 from January to July this year, the latest data from the Bureau of Labor Statistics showed.

While the U.S. is producing a record 13.9 million barrels per day this month, gains in the world’s top producer are slowing.  The Permian rig count, a proxy for future output, has fallen by 52 to 252 at the end of October from a year earlier, the steepest decline since 2020, when Covid-19 slashed demand, data from energy analytics firm Enverus showed.

—Nvidia reported record sales and strong guidance Wednesday, briefly soothing jitters about an artificial intelligence bubble that has been reverberating in markets for the last week.

Sales in the October quarter hit a record $57 billion as demand for the company’s advanced AI data center chips continued to surge, up 62% from the year-earlier quarter and exceeding consensus.  CEO Jensen Huang said sales of Nvidia’s Blackwell line of graphics processing units – its most powerful chips yet – were “off the charts.”

The company increased its guidance for the current quarter, estimating that sales will reach $65 billion – with the Street at $62 billion.

Adjusted earnings per share of $1.30 beat estimates of $1.25 on revenue of $55 billion.  Quarterly net income was $31.9 billion, 65% higher than a year earlier.

The key data center business brought in $51.2 billion vs. estimates of $49 billion.

“We’ve entered the virtuous cycle of AI,” said Huang.  “AI is going everywhere, doing everything all at once.”

In his conference call with analysts, Huang added: “There’s been a lot of talk about an AI bubble.  From our vantage point, we see something very different.”

Meanwhile, CFO Colette Kress said Nvidia’s newly announced $100 billion strategic partnership with ChatGPT maker OpenAI has not been finalized.

In a quarterly regulatory filing, Nvidia said there is no assurance that it will enter into definitive agreements with respect to the OpenAI opportunity or other potential investments, or that any investment will be completed on expected terms.

Also consider this…Nvidia’s business has become increasingly concentrated.  In its fiscal third quarter, four customers accounted for 61% of sales, up from 56% in the second quarter.  The company has also invested billions of dollars into some of its customers, leading to concerns of a circular AI economy.

–It was Big-Box retailer week on the earnings front, with Home Depot’s shares falling Tuesday after the company reported mixed results amid anxiety among U.S. consumers and a housing market that is in a deep funk.

The company lowered its fiscal 2025 adjusted earnings forecast but raised its expectations for sales growth.

For the three months ended Nov. 2, Home Depot earned $3.6 billion, or adjusted earnings of $3.74, a dime short of Wall Street’s expectations.  It is the third consecutive quarter that HD has missed profit forecasts.

“Our results missed our expectations primarily due to the lack of storms in the third quarter, which resulted in greater than expected pressure in certain categories,” Ceo Ted Decker said in a statement.  “Additionally, while underlying demand in the business remained relatively stable sequentially, an expected increase in demand in the third quarter did not materialize. We believe that consumer uncertainty and continued pressure in housing are disproportionately impacting home improvement demand.”

Revenue for the Atlanta-based company rose to $41.35 billion from $40.22 billion, topping the Street’s projection of $41.15bn.

Same-store sales increased 0.2%, in the U.S. up 0.1%.

Home Depot now anticipates 2025 adjusted earnings will decline approximately 5% from 2024’s $15.24 per share.

The chain now foresees fiscal 2025 sales growth of about 3%, up slightly from a prior forecast of 2.8% It expects comp sales growth will be up a fraction vs. a previous outlook of 1% growth.

Home Depot’s results come as the U.S. housing slump drags on, with the country’s home turnover rate at the lowest level in decades.

–HD rival Lowe’s Cos. reported profit that topped expectations on a pickup in online sales and growth in demand from professional contractors.

Adjusted earnings per share were $3.06 in the third quarter, compared with the consensus of $3.00.

Lowe’s reported positive same-store growth for a second consecutive quarter on strength in its digital channel and in home services, though just up 0.4% vs. expectations for 1%.  It saw “continued growth” in sales to professional contractors, a market it has sought to expand in recently.

Lowe’s helped build out its professional business with the $8.8 billion cash deal to buy drywall company Foundation Building Materials in August.  That move deepened its market position with contractors, who tend to buy more and spend more frequently compared to regular customers.

The company adjusted its full-year profit target to $12.25 a share this fiscal year, after previously talking of $12.20 to $12.45 per share.  Lowe’s expects total sales of $86 billion for the year, up from previous guidance for $84.5 billion to $85.5 billion.

—Target once again delivered a warning about its business with its earnings report Wednesday, cutting its full-year profit guidance while warning of a tepid holiday season as strapped consumers battle through an affordability crisis for food, healthcare, and housing.

“Many of the themes remain largely consistent with what we’ve shared in prior quarters.  Guests are choiceful, stretching budgets and prioritizing value.  They’re spending where it maters most, especially in food, essentials, and beauty,” Target chief commercial officer Rick Gomez said on a call with reporters, adding that shoppers are looking for deals on discretionary items.

Target promised to ramp up capital expenditures by 25% in 2026 to improve the appearance of its stores.  The company said it cut prices on 3,000 food and household essential items last week.

“We believe there is a path to win regardless of how the macro environments will continue to evolve around us,” incoming Target CEO Michael Fiddelke said.  [Fiddelke – a Target veteran – succeeds longtime Target CEO Brian Cornell on Feb. 1, 2026.]

Comp-store sales fell 2.7% in the third quarter, compared with estimates of a 2.1% drop.

Sales in the household essentials category fell 3.7%, while digital comparable sales rose 2.4%, the last one missing the Street’s expectations for 3.2% growth.

Target cut the top end of its annual earnings forecast by a dollar to a range of $7.00 to $8.00 per share.

The company earned $1.78 per share in the quarter ended November 1, beating estimates, while total revenue of $25.27 billion fell 1.6%.

Last month Target cut 1,800 corporate jobs in a bid to reduce costs and streamline operations.

–But Thursday, Walmart delivered another standout quarter, posting strong sales and profits that blew past Wall Street expectations as it wins over more cash-strapped Americans who have grown increasingly anxious about the economy.

With other retailers dialing back projections, the nation’s largest retailer raised its financial outlook after its strong third quarter, setting itself up for a strong holiday shopping season.

CEO Doug McMillon, who surprised investors with plans to retire early next year, has reshaped WMT as a tech-powered retail giant that has leaned heavily into automation and artificial intelligence, going to-to-toe with Amazon.

Walmart’s performance serves as a barometer of consumer spending given its size and vast customer base. The company maintains that 90% of U.S. households rely on Walmart for a range of products, and more than 150 million customers shop on its website or in its stores every week.

Third-quarter profits rose to $6.14 billion, or 66 cents per share for the quarter, adjusted, with sales rising 6% to $179.5 billion, up from $169.6 billion in the year-ago period.

Analysts were at 60 cents on sales of $177.4bn.

Comparable sales at U.S. stores rose 4.5% vs. the previous quarter’s 4.65 pace.  Global e-commerce sales rose 27% after a 25% jump in Q2 and 22% in the first quarter.

McMillon said in a statement: “eCommerce was a bright spot again this quarter.  We’re gaining market share, improving delivery speed, and managing inventory well.”

The company said that it now expects adjusted profits per share for the fiscal year to be in the range of $2.58 to $2.63, up from the early guidance offered in August of $2.52 to $2.62 per share.

Walmart also said it expects sales for the year to be up anywhere from 4.8% to 5.1%, also up from previous guidance.

Separately, the company is moving its listing to Nasdaq from the NYSE.

“Moving to Nasdaq aligns with the people-led, tech-powered approach to our long-term strategy,” said John David Rainey, the company’s CFO.

—U.S. airlines were able to resume normal operations starting Monday after more than a week of government-mandated flight reductions that caused more than a bit of chaos.

The Transportation Department and Federal Aviation Administration announced late Sunday they would lift cuts across 40 major U.S. airports that were imposed during the government shutdown, starting from 6 a.m. Monday.

Staffing levels snapped back into place since the shutdown ended, they said in a statement.

Meanwhile, one of the busiest travel days is among us with Thanksgiving arriving on Nov. 27, also marking the start of the holiday travel season.

This year, 81.8 million Americans are set to travel between Nov. 25 and Dec. 1 – approximately 1.6 million more than last year – once again breaking a new record for domestic travelers, according to AAA.  The majority of Thanksgiving travelers will hit the road, but about 6 million are set to take to the skies to reach their destinations.

–According to aviation analytics firm Cirium, owing to the 43-day government shutdown, which culminated in significant flight cuts, through last Friday bookings were down 3.3% compared with last year for the period starting before the Wednesday before Thanksgiving and ending on the Sunday after.

The steepest decline came in the first two weeks of November, with bookings falling nearly five percentage points compared with the end of October, when they were actually up slightly. Travelers are also being extra cautious.  Travel site Hopper shows a 30% increase in customers adding travel disruption assistance.

But, as alluded to above, air travel is still expected to increase 2.1% this year vs. 2024 for the holiday.  Flight prices are about the same as last year, according to AAA.

—TSA checkpoint numbers vs. 2024

11/20…120 percent of 2024
11/19…110
11/18…74
11/17…88
11/16…134
11/15…72
11/14…96
11/13…117

–Alphabet shares rallied 3% Monday on news that Berkshire Hathaway bought $4.3 billion worth of the Google parent’s shares in the third quarter, according to the company’s latest 13-F report.

Separately, Alphabet CEO Sundar Pinchai, in an interview with the BBC, said people should not “blindly trust” everything AI tools tell them.

Pichai said that AI models are “prone to errors” and urged people to use them alongside other tools.

Pichai said it highlighted the importance of having a rich information ecosystem, rather than solely relying on AI technology.

“This is why people also use Google search, and we have other products that are more grounded in providing accurate information.”

While AI tools were helpful “if you want to creatively write something,” Pichai said people “have to learn to use these tools for what they’re good at and not blindly trust everything they say.”

He told the BBC: “We take pride in the amount of work we put in to give us as accurate information as possible, but the current state-of-the-art AI technology is prone to some errors.”

Google’s consumer AI model, Gemini 3.0, is starting to win back market share from ChatGPT.  As you’ve noticed, Google began introducing a new “AI Mode” into its search, integrating its Gemini chatbot which is aimed at giving users the experience of talking to an expert.

The move is also part of the tech giant’s bid to remain competitive against AI services such as ChatGPT, which have threatened Google’s online search dominance.

BBC research earlier this year found that AI chatbots inaccurately summarized news stories.

OpenAI’s ChatGPT, Microsoft’s Copilot, Google’s Gemini and Perplexity AI were all given content from the BBC website and asked questions about it, and the research found the AI answers contained “significant inaccuracies.”

Pichai also said no company would be unscathed if the artificial intelligence boom collapses.  He said the current wave of AI investment was an “extraordinary moment” but acknowledged “elements of irrationality” in the market, echoing warnings of “irrational exuberance” during the dotcom era.

Asked about how Google would cope with a potential bursting of a bubble, Pichai said he thought it could weather the storm but added: “I think no company is going to be immune, including us.”

–Related to the above, two of the biggest backers of start-up OpenAI are collaborating on a $15 billion investment in rival AI start-up Anthropic, in another example of the AI sector’s circular tie-ups, linking cloud computing and chip providers with the firms that build the AI models.

Anthropic will buy $30 billion of computing capacity and up to one gigawatt of additional capacity from Microsoft to scale its flagship AI assistant Claude on the Azure platform.  Nvidia will work with Anthropic to design its models.  Nvidia’s investment is $10 billion, and Microsoft’s is $5 billion.

Microsoft CEO Satya Nadella said it’s no longer about “winner take all” attitudes.   He urged the tech industry to move beyond those narratives and instead build broad durable capabilities together, “so that this technology can deliver real tangible local success.”

But Sundar Pichai above warned about overinvesting in AI.  Nvidia’s Jensen Huang clearly feels differently.

–A federal judge ruled that Meta Platforms isn’t an illegal monopoly, meaning the Facebook parent can avoid selling its other social media brands such as Instagram and WhatsApp.

The Federal Trade Commission sued Meta in 2020, claiming it bought competitors to maintain its monopoly in personal social networking. But District Court Judge James Boasberg said the industry has rapidly evolved, and the FTC failed to prove that Facebook still maintains the same power it once had.

Earlier this year, the government lost on forcing Alphabet’s Google to divest its market dominant Chrome search engine. While a federal judge agreed that Google used anticompetitive contracts to keep dominant in search, artificial intelligence chatbots were eroding that power, and the judge stopped short of ordering a sale.

Meta’s Chief Legal Officer Jennifer Newstead told Barron’s that the court’s decision “recognizes that Meta faces fierce competition.”

–Investors pulled more than half a billion dollars from BlackRock Inc.’s iShares Bitcoin Trust, the largest single-day outflow since the fund’s debut, and the latest blow to a digital-assets market already short on confidence.

BlackRock saw $523 million in outflows from the exchange-traded fund on Tuesday, marking a fifth straight day of net redemptions, according to data compiled by Bloomberg.

On Tuesday, Bitcoin dipped below a key price point that meant investors in the 12 U.S. Bitcoin EFTs found themselves sitting on collective losses.  Those funds have suffered outflows of more than $3 billion so far in November, with nearly $2 billion pulled from IBIT alone.

IBIT, the largest Bitcoin ETF, has proved a smash-hit with investors since launching in January 2024. It has amassed more than $72 billion in assets with nearly $26 billion of inflows this year.

—Britain’s domestic intelligence agency warned on Tuesday that China has been using headhunters on LinkedIn and other covert operatives in an effort to recruit and compromise lawmakers and parliamentary staff members.

The warning came just two months after a political scandal erupted in Britain over the collapse of an espionage case against a parliamentary researcher and a teacher accused of funneling sensitive information to Beijing.

Tuesday’s espionage alert from the agency, MI5, warned lawmakers that the Chinese foreign intelligence service, the Ministry of State Security, had been secretly targeting members of Parliament, government staff members, political consultants, economists and think tank employees.

“The headhunters are typically China-based individuals who make initial contact with a target before referring them to an officer,” the MI5 alert said.

–Since I mentioned the cost of a Thanksgiving dinner and inaccurate use of Walmart’s annual offer last week by some politicians, for the record the American Farm Bureau Federation’s annual supermarket survey for a Thanksgiving estimated the cost of a holiday meal for 10 this year at $55.18, down 5% from 2024 and the lowest since 2021.

This is still 13% higher than what the bureau’s “classic meal” – featuring a 16-pound turkey, stuffing, sweet potatoes, sweet peas dinner rolls, pumpkin pie and other items – cost in 2019 before the Covid-19 pandemic and the relief efforts arising from it helped to stoke a surge in inflation.

“While the wholesale price for fresh turkey is up from 2024, grocery stores are featuring Thanksgiving deals and attempting to draw consumer demand back to turkey, leading to lower retail prices for a holiday bird,” the Farm Bureau said in a statement.

Foreign Affairs

Russia/Ukraine: A large Russian drone and missile barrage Tuesday night killed at least 25 people and injured 70, with more than a dozen missing, the toll rising hourly Wednesday, as Ukrainian President Volodymyr arrived in Turkey for talks on finding a settlement that might end Russia’s invasion of his country.

The nighttime attack hit two nine-story apartment blocks in Ternopil, a city in western Ukraine about 120 miles from the Polish border that sits in a part of relatively peaceful western Ukraine, where many people from the east and south moved as they fled danger along the front line.  Emergency crews were sifting through the rubble into the daylight to find any survivors.

Ukraine’s second-largest city, Kharkiv, was also hit with scores injured.

Russia fired 467 strike and decoy drones, as well as 48 missiles of various types at Ukrainian targets, including the energy infrastructure yet again.

Power cuts were affecting a number of regions across the country, Ukraine’s energy ministry said.

“Every brazen attack against ordinary life indicates that the pressure on Russia (to stop the war) is insufficient,” Zelensky wrote on Telegram.

Zelensky said that in meeting with Turkish President Tayyip Erdogan he hopes to diplomatically isolate Vladimir Putin and bring more international pressure to bear on him.

“Foremost, we will discuss maximum capabilities to ensure that Ukraine achieves a just peace,” Zelensky said of his talks with Erdogan, adding that the leaders have “good relations.”

Zelensky also said: “We see some positions and signals from the United States, well, let’s see tomorrow.”

Tough new American sanctions on Russia’s oil industry, devised to push Putin to the negotiating table, are due to take effect on Friday.

U.S. special envoy Steve Witkoff was to join Zelensky in Turkey, but then we learned he wasn’t going.

Romania scrambled its fighter jets when a drone entered the NATO member’s airspace during Russia’s attack Tuesday night, Romania’s Ministry of National Defense said. Poland also scrambled its fighter jets during the drone attack.

Meanwhile, the Russian Defense Ministry said Wednesday that Ukraine fired four American-supplied ATACMS missiles at the Russian city of Voronezh Tuesday, but the ministry said all four were intercepted, with no casualties from the debris.

Ukraine’s General Staff reported firing ATACMS at Russia without offering details.

–Regarding Witkoff, the administration and Russian officials have been secretly hashing out a revised plan to end Moscow’s 33-month-old invasion of Ukraine.

The 28-point framework is inspired by President Trump’s 20-point road map for ending the war between Israel and Hamas terrorists in the Gaza Strip, Axios reported, citing U.S. and Russian officials.

The plan is meant to be a sweeping blueprint that not only ends the war in Ukraine but also hashes out questions about security guarantees for the Kyiv government and the rest of Europe, as well as future ties between Washington and the two warring nations.

“We feel the Russian position is really being heard,” Kirill Dmitriev, the head of Russia’s sovereign wealth fund who has taken a greater hand in the Kremlin’s diplomatic push, told the outlet in an interview Monday.

Dmitriev added that he met with Witkoff and other administration officials for three days in Miami late last month.

Ukrainian officials told the outlet that Witkoff discussed the plan with Kyiv’s national security adviser, Rustem Umerov.

Wednesday, Army Secretary Dan Driscoll and Chief of Staff Gen. Randy George were in Ukraine.  They are “on a fact-finding mission to meet with Ukrainian officials and discuss efforts to end the war,” Army Spokesperson Col. Dave Butler told CNN in a statement.

But the Financial Times reported that the draft peace plan would have Ukraine cut its army in half and cede to Russia 20,000 square miles of its coal-rich Donbas region (Donetsk and Luhansk oblasts), as well as Crimea.  It would also force Ukraine to abandon hope of joining NATO, and NATO would agree never to station troops in Ukraine.

But the Trump administration also wants “Ukraine to abandon key categories of weaponry and would include the rollback of U.S. military assistance that has been vital to its defense,” as the FT reported, citing people with knowledge of the U.S. document.

Sanctions against Russia would be gradually lifted, Moscow would be invited back into the G8 group of industrialized countries, and frozen Russian assets would be pooled in an investment fund, with Washington given some of the profits.

One of Ukraine’s main demands for enforceable guarantees equivalent to the NATO alliance’s mutual defense clause to deter Russia from attacking again, is dealt with in a single line with no details: “Ukraine will receive robust security guarantees.”

European officials have expressed alarm over the planned concessions from Ukraine, with European Commission Vice President Kaja Kallas telling reporters Thursday, “[For] any plan to work, it needs Ukrainians and Europeans on board. In this war, there is one aggressor and one victim.  So far, we haven’t heard of any concessions from Russia’s side,” she said.

“Peace cannot be a capitulation,” French Foreign Minister Jean-Noel Barrot said Thursday in Brussels.  Another European Union defense official told Politico, “Europeans have not been consulted on this.  But there’s a wing inside the White House who for some time have seen Europeans as ‘spoilers’ in the peace process, so in a way, it’s not surprising.”  The official added, “The Russians have clearly identified Witkoff as someone who is willing to promote their interests.”

Reminder, a peace deal that requires Kyiv to hand over territory to Russia would not only be deeply unpopular with Ukrainians, it also would be illegal under Ukraine’s constitution. And President Zelensky has repeatedly ruled out such a possibility.

The Kremlin has said no talks are taking place despite what Kirill Dmitriev said above.  But Zelensky then said he had received the draft plan.

Thursday, White House officials said they’ll get Ukraine and Russia to agree to some form of this new plan “as soon as this week.”

Friday, Zelensky’s top security official denied he had agreed to the Trump peace plan, and European leaders sought a response to the draft that endorses most of Russia’s key wartime demands.

U.S. officials said the plan was drafted after consultations with Rustem Umerov, secretary of Ukraine’s National Security and Defense Council, a close Zelensky ally who served as defense minister until July.

The terms of the plan have been previously dismissed as tantamount to surrender by Ukrainian officials.

In his nightly address, Thursday, Zelensky said U.S. military officials in Kyiv had “presented its proposals, the points of a plan to end the war – their vision.”

“From the first days of the war, we have upheld one very simple position: Ukraine needs peace.  A real peace – one that will not be broken by a third invasion.”

Zelensky said he was set to speak to Trump in the coming days about the proposals.

White House Press Secretary Karoline Leavitt said Thursday: “It’s a good plan for both.  We believe that it should be acceptable to both sides.  And we’re working very hard to get it done.”

Friday, President Zelensky said his country was facing one of the biggest challenges in its history.

“Now is one of the most difficult moments in our history,” Zelensky said in a video address.  “Now Ukraine may find itself facing a very difficult choice.  Either loss of dignity, or the risk of losing a key partner.”

Russian forces continue to advance in eastern Ukraine, while Moscow’s attacks on Ukraine’s energy systems have left much of the country with electricity for only a few hours a day.

President Trump, seemingly for the first time in a month, commented on Ukraine Friday morning, telling Fox News Radio’s Brian Kilmeade in response to a question about whether he’s given Ukraine a deadline to agree to the plan, “Thursday is, we think, an appropriate time.  We’re in it for one thing. We want the killing to stop.”

Trump suggested he may extend the deadline “if things are working well.”

Zelensky held a call with the leaders of France, the UK and Germany to discuss peace proposals. In his video address, he said: “We are counting on European friends who understand that Russia is not far away, that it is near the borders of the EU, that Ukraine is now the only shield separating comfortable European life from Putin’s plans.”

Zelensky’s address reflected the pressure he now faces as he is squeezed between Trump, who wants a peace deal; Russia, which wants to take control of Ukraine; and Ukrainians, who are willing to fight on despite daunting odds.

An October survey by the Kyiv International Institute for Sociology found that 71% of Ukrainians opposed transferring territory Ukraine currently controls to Russia.

Editorial / New York Post

“Yuck. The draft ‘peace’ plan Russian officials have hashed out with envoys from President Donald Trump’s administration is barely more than a complete Ukrainian surrender.

“ ‘Ukraine will receive reliable security guarantees,’ it says.  From who?

“Not Washington.  Trump’s been crystal clear that U.S. forces won’t get drawn into this war.

“And no one in Europe has the ability to offer reliable guarantees: Most nations barely have armies at all.

“Meanwhile, the draft imposes all manner of specific losses on Kyiv: Give up its claims to Russian-occupied Crimea and other areas, including parts of the Donbas that the Kremlin hasn’t seized; agree to Russian control of now-occupied Kherson and Zaporizhzhia; let Moscow claim half the electricity from the Zaporizhzhia nuclear-power complex; shrink its army by more than half and on and on.

“The draft says both sides get ‘full amnesty for their actions during the war,’ when all the atrocities have been Russian; every humanitarian post-war provision is conditioned on future negotiations.

“We get why bloody Vladimir Putin wants all this, but how can this amount to a plan for lasting peace when not four years ago he simply set out to conquer the whole country on the absurd pretext of ousting its ‘Nazi’ leadership, and when he’s ruthlessly slaughtered civilians by the tens of thousands simply because Ukraine fought back?

“Back in September, Trump rightly recognized that Ukraine was winning, so President Volodymyr Zelensky had no need to cede territory to win a peace.

“Ukraine’s strikes on oil refineries landed a hard blow on Russia’s wobbling economy, and Trump applied more pressure with sanctions on Moscow’s two largest energy companies, while the European Union followed up with stiff penalties of its own.

“Russia’s oil exports have since dropped by as much as 73%; the Kremlin is at risk of running out of both cash and bodies to throw at the conflict.

“Yes, Zelensky is facing a major scandal and resulting political crisis, but that’s no reason to rescue Putin from the corner he’s backed into.

“No wonder Kremlin shill Kirill Dmitriev crowed: ‘We feel the Russian position is really being heard.’

“Maybe special envoy Steve Witkoff sees a point in at least getting Putin to specify his demands for an end to fighting, with an eye to some more-realistic counteroffer.

“We take some heart from Secretary of State Marco Rubio’s comment: ‘Achieving a durable peace will require both sides to agree to difficult but necessary concessions,’ he wrote late Thursday on X, suggesting this ‘plan’ is just one step toward drawing up ‘a list of potential ideas for ending this war based on input from both sides of this conflict.’

“Ukraine should counteroffer with equally serious proposals, starting with a complete Russian withdrawal (including from Crimea) and Moscow’s major disarmament.

“Heck, Kyiv could demand the ouster of Putin’s regime and it would still be less one-sided than this nonsense.”

Today, Trump issued his ultimatum.

—The U.S. said this week it has approved Ukraine’s potential purchase of equipment to upgrade its Patriot air defense launchers to the latest configuration. The sale could be worth up to $105 million, the Defense Security Cooperation Agency said in a Tuesday statement and it has notified Congress.

–Meanwhile, President Zelensky has a huge corruption scandal on his hands involving the country’s energy sector.

Around $100 million has been embezzled, anti-graft investigators said, causing outrage in a country where Russian attacks have resulted in crippling power outages.

“Alongside a full audit of their financial activities, the management of these companies is to be renewed,” Zelensky wrote in a post on X on Saturday.

Energoatom, the state nuclear company at the heart of the scandal, will have a new supervisory board “within a week,’ he added.

Several of those implicated in the scandal have close links to the president.

The scandal is unfolding against the backdrop of escalating Russian attacks on Ukrainian energy facilities, including substations that supply electricity to nuclear power plants.

“I have also instructed government officials to maintain constant and meaningful communication with law enforcement and anti-corruption bodies,” Zelensky wrote.

Two ministers were forced to resign over the corruption scheme and a former business partner of Zelensky was sanctioned earlier last week when the scandal broke.

This all has brought Zelensky’s commitment to fighting corruption under scrutiny once again.

In July, he faced backlash after he signed a law limiting the independence of the National Anti-Corruption Bureau of Ukraine (Nabu) and Specialized Anti-Corruption Prosecutor’s Office (Sap).

The outrage was only quelled by Zelensky’s decision to reinstate their freedom, but the debacle prompted criticism from European allies including France and Germany.

And now the gloves are off in terms of internal politics in Ukraine, with many Ukrainians having reacted with disgust to the accusations that Zelensky’s allies have enriched themselves, while the country’s soldiers are dying in a fight for national survival.

No significant politicians in Ukraine are calling for Zelensky to resign, yet, and with elections suspended under martial law, he can’t be voted out of office.  But this case poses serious risks to him, analysts say.

—Two Ukrainian citizens who long worked for Russian intelligence have been identified as the suspects behind two acts of sabotage on Poland’s rail network, Polish Prime Minister Donald Tusk said.

One suspect had already been convicted in absentia of sabotage in Ukraine, Tusk told parliament.

On Monday, he visited the scene of an explosion near Mika, southeast of Warsaw, which damaged the railway line leading to the Ukrainian border at the weekend, and called it an “unprecedented act of sabotage.”

The Kremlin brushed off suggestions of Russian involvement.

“The goal was to cause a rail catastrophe,” Tusk told MPs.

Russia’s motivation, Tusk went on, was to sow panic and stir up anti-Ukrainian sentiment in Polish society, which is home to more than one million Ukrainian war refugees.

“I want to emphasize that what the Russian authorities care about is not only the direct effect of this type of action, but also the social and political consequences of the fact that this action is taking place,” he said.

“This of course means disorganization, chaos, panic, speculation and uncertainty.”

Poland is both a NATO and EU member state, and its railway network has become vital for moving supplies of aid into Ukraine since Russia launched its full-scale invasion.

Israel/Gaza: A U.S.-drafted UN resolution endorsing President Trump’s Gaza peace plan passed overwhelmingly in the Security Council on Monday, a major victory for administration diplomacy as it struggles to implement its blueprint for what Trump has said would be “a new dawn” for the Middle East.

The resolution provides a legal mandate for key parts of the plan, including persuading other countries to provide troops for an International Security Force that will take over security in the half of Gaza from which Israel has withdrawn.

The plan calls for an early role for the Palestinian Authority in rebuilding Gaza and a firmer commitment to an eventual Palestinian state.

In the 15-member Security Council, 13 voted in favor, none against, with Russia and China abstaining.

Hamas said that turning in their weapons, as the peace plan demands, “must remain an internal national matter” tied to the end of the Israeli occupation.

Prime Minister Benjamin Netanyahu has repeatedly said Israel would never agree to the establishment of a Palestinian state.

–Separately, the UN has warned of an alarming surge in attacks by Israeli settlers against Palestinians in the West Bank, with the number of incidents rising every year for almost a decade. This year, the UN’s humanitarian office, OCHA, has recorded more than 1,400 settler attacks that resulted in casualties or property damage.

Violence typically spikes around October, the start of the olive harvest season, with settlers increasingly seeking to disrupt it.  OCHA said last week it recorded 264 attacks in October, most of them directly linked to the harvest.

Israeli military chief of staff Lt. Gen. Eyal Zamir said Wednesday that he strongly condemned attacks by Israeli citizens against both Palestinians and Israelis, calling them a red line that disrupts the mission of his forces.

“We are determined to stop this phenomenon and will act decisively until justice is served,” Zamir said.

Saudi Arabia: On Tuesday, a jovial President Trump held a warm and friendly meeting with Saudi Crown Prince Mohammad bin Salman at the White House, in which he brushed aside questions about Saudi Arabia’s human rights record, praised the prince for his statesmanship and announced hundreds of billions of dollars in new Saudi investment in the U.S.

Tuesday’s meeting was the first White House visit for the crown prince since journalist Jamal Khashoggi was killed and dismembered at the Saudi consulate in Istanbul, Turkey, in 2018.  U.S. intelligence said Prince Mohammad likely approved the slaying.  Prince Mohammad was asked about Khashoggi’s slaying along with the role that Saudi citizens played in the Sept. 11, 2001, attacks in the U.S.  Trump, however, lashed out at the reporter for the line of questioning.  The Crown Prince, who has denied involvement in Khashoggi’s killing, replied that his government had taken action, “did all the right steps” to investigate the death. “It’s painful and a huge mistake,” he said.

When a reporter asked Mohammed about the CIA’s finding that he had ordered the killing of Khashoggi, Trump interjected.  “He knew nothing about it,” the president.  “You don’t have to embarrass our guest by asking something like that.”

At the dinner Tuesday night, Mohammad was feted at an event attended by tech titans such as Jensen Huang, Elon Musk and Tim Cook, along with soccer star Cristiano Ronaldo, with Trump conferring “major non-NATO ally” status on Saudi Arabia.

The prince arrived at the White House with some of his objectives already accomplished: Mr. Trump said on Monday that he intended to sell the kingdom F-35 fighters despite concerns raised by the Pentagon about the risks involved with selling the technology to an ally that has a security partnership with China.

Prince Mohammed also said he wants Saudi Arabia to be part of the Abraham Accords and establish ties with Israel, but must be sure of “a clear path to a two-state solution” before that.  Such a deal is unlikely anytime soon.

As the Washington Post editorial board noted:

“[During his visit], MBS continued to resist Trump entreaties to join other moderate Arab states in the Abraham Accords.  The prince says such recognition could only come after Israel recognizes a credible pathway to a Palestinian state. The F-35 transfers would have been a great carrot to induce MBS to sign onto the accords.  Alas, that’s no longer an option….

“While cultivating an image as a modernizer – allowing women to drive, expanding entertainment venues, hosting comedy festivals and curbing the powers of the religious police – Mohammed presided over a ruthless crackdown on dissent.  Saudi Arabia carried out hundreds of executions in 2025, including journalist Turki al-Jasser and political opponents.  Toasting MBS at the dinner in his honor, Trump called Saudi Arabia ‘a modern-day miracle.’”

Karen Elliott House / Wall Street Journal…Ms. House former publisher of the Journal

“This is a time of sobering transition for the kingdom as Vision 2030, the crown prince’s modernization blueprint, enters its second decade.  Over the first 10 years, MBS dispensed ‘giga’ projects involving large-scale developments to diversify the kingdom off oil as if he were Santa Claus.  Now the budget is stretched by too many expensive projects, low oil prices and failure to attract investment at the level the kingdom had hoped. Foreign direct investment by the second quarter of 2025 grew to $25 billion from a year earlier, but remains well off the $100 billion goal for 2030.  So big projects are being stretched out and some young Saudis during my visit complained that high-paying jobs are increasingly hard to find, driving them to settle for less challenging and lower-paying positions….

“The crown prince’s increasingly low profile on Gaza since he accused Israel of ‘genocide’ in 2024 makes sense given his challenges at home. Young Saudis oppose any recognition of Israel and surely wouldn’t be pleased to see Saudi troops as part of the peacekeeping force in Gaza.  Saudi Arabia has insisted it won’t participate in the peacekeeping force or pay for reconstruction of Gaza only to see it blown up again: There must be a two-state solution first. The Israeli government rejects that, as do radical Palestinians….

“On top of all this, the clock is ticking to Dec. 31, King Salman’s 90th birthday.  The king is in frail health and said to have mild dementia.  His brother the late King Abdullah died five months after his 90th birthday in 2015.  So, the kingdom clearly is in a succession transition. MBS, as crown prince, should replace his father as king. But some members of the family have recently expressed fears that disgruntled royals or displaced religious leaders may try to sow discord. ‘Ninety-five percent of us want MBS as king but this is a tense time waiting for that to happen,’ one Saudi prince told me.  ‘We don’t want anyone to cause trouble.’

“In this transition period from crown prince to king, MBS has extra reason to be reflective and cautious.  Recognizing Israel or making concessions on Gaza that his youthful supporters oppose wouldn’t be prudent.  There’s time for that later, aides say. His mission now isn’t to dazzle his people with his decisiveness but to display his determination to make sure his big projects truly diversify the economy, provide jobs for the roughly 63% of Saudis who are under 30, and wean the kingdom off oil revenue. All this has to be done with Iran’s Ayatollah Ali Khamenei declaring last month that Iran and its regional allies ‘will not back down’ in the face of confrontation with Israel, raising the risk that Iran might lash out at Saudi Arabia’s oil or its huge development projects. That risk is more reason to solidify Saudi’s relationship with its U.S. protector.”

China: Beijing escalated its confrontation with Japan over Prime Minister Sanae Takaichi’s comments on Taiwan, with state media threatening major countermeasures after Beijing’s travel warnings raised the specter of economic retribution.

Yuyuantantian, a social media account linked to China’s state broadcaster and frequently used to signal official policy, published a commentary last weekend warning that Beijing “has made full preparations for substantive retaliation.”  The post hinted at imposing sanctions, suspending economic, diplomatic and military ties, and restricting trade as forms of potential reprisal.

Hours after the post, the People’s Liberation Army Daily reinforced that message publishing a commentary by a state-affiliated scholar warning that if Japan’s military got involved in the Taiwan Strait “the entire country would risk becoming a battlefield.”

The diplomatic crisis erupted over Takaichi’s comments earlier this month that military force used in any Taiwan conflict could be considered a “survival-threatening situation,” a classification that would provide a legal justification for Japan to support friendly countries that choose to respond.  China is highly sensitive to remarks around Taiwan, the self-ruled island it’s vowed to claim someday, by force if necessary.

The row risks unraveling recent progress in bilateral ties, just a few weeks after Takaichi met with President Xi and agreed to improve relations.  The spat also threatens to inflict damage on businesses straddling the key trading partners, as China warns tourists and students about heightened risks in Japan.

Those measures put millions of Chinese tourists – about a quarter of all visitors to Japan annually – on the line, triggering slides in travel-related stocks.  Hong Kong also updated its travel advisory for Japan.

The number of cancellations of Chinese tourists to Japan skyrocketed. According to analyst Li Hanming, citing data covering all mainland China-based airlines: “The flight-ticket cancellations [on Sunday] were 27 times that of new bookings, which shows safety concerns are the dominating factor for travel,” he said, adding that he had not seen cancellations on such a scale since early in 2020, as Covid-19 infections surged at the tail end of the Lunar New Year travel period. [South China Morning Post]

China’s biggest airlines have offered full refunds for flights to Japan after Beijing told Chinese citizens to avoid travel to the country.

Japan warned its citizens in China to step up safety precautions and avoid crowded places.

Reminder, Taiwan is located just over 68 miles from Japanese territory and the waters around it offer a vital sea route for Tokyo’s trade.  Japan also hosts the largest contingent of U.S. military overseas (think Okinawa).

Walter Russell Mead / Wall Street Journal

“China’s wolf warriors have a new target.  Reuters reports that they’re resorting to barnyard language to attack Sanae Takaichi, Japan’s new prime minister.  ‘Has her head been kicked by a donkey?’ asked a social-media account linked to the state broadcaster CCTV.  ‘If she continues to spew [scatological vulgarity] without any boundaries like this, Takaichi might have to pay the price!’

“ ‘We have no choice,’ posted China’s consul general in Osaka, ‘but to cut off that dirty neck that has lunged at us without a moment’s hesitation.  Are you ready?’  That post has been taken down, but plenty of others jumped in. As the crisis escalated, Chinese officials urged Chinese tourists and businesspeople to avoid travel to Japan, warned students of risks they allegedly faced there and sent a flurry of coast guard ships to patrol waters claimed by Japan.

“Ms. Takaichi’s ‘crime’ was to give an honest and straightforward answer to a question in Parliament.  Katsuya Okada of the Constitutional Democracy Party had asked what Chinese actions in or around Taiwan would constitute ‘a survival-threatening situation’ for Japan.

“It’s a serious question.  Under national security legislation passed in 2015, ‘survival-threatening’ situations could trigger an armed Japanese response. Ms. Takaichi’s answer was clear. An armed attempt by China to force Taiwan under its control could constitute the kind of survival-threatening situation the 2015 legislation envisioned, and Japan’s forces might well support the U.S. and other allies under those circumstances.

“While no previous Japanese leader had put things quite so clearly, there was no real change in Japan’s underlying position. A Chinese attack on Taiwan would pose a massive threat to Japan.  In the short term, war would disrupt trade, blocking imports of food and energy without which Japan couldn’t survive, and placing tens of thousands of Japanese visitors, students and businesspeople in Taiwan at risk.

“Some Chinese reaction was inevitable.  Countries that have territorial claims must constantly assert those claims to keep them alive….

“But if a reaction was inevitable, a crisis wasn’t.  China could have made a pro forma protest and moved on in a couple of weeks. Instead, Beijing has decided to turn a modest kerfuffle into a major confrontation.  Why?

“Beijing’s motivations can be hard for outsiders to read, but two things seem to be happening.  First, the Chinese Communist Party has a long tradition of bullying. Whether it is dealing with opponents at home or obstreperous foreign governments, Beijing’s first instinct is often to intimidate, threaten and, when possible, to compel.  If this works, fine.  If it doesn’t, China can always switch to a less confrontational approach.

“Second, Beijing hopes to undermine Ms. Takaichi’s power before she can fully consolidate her position….

“China worries that Ms. Takaichi, unchecked, will take more steps to strengthen Japan’s military posture.  A Kyodo News report suggests that her government may be considering an end to Japan’s longstanding ban on nuclear weapons on its territory.  As China carries out the fastest nuclear arms-building program in world history, it wants weak, nonnuclear neighbors.

“China hopes that pitching a fit over Ms. Takaichi’s statement could activate her domestic opponents. Lots of Japanese companies depend on Chinese factories for key imports, and many others depend on access to Chinese markets… Many of Ms. Takaichi’s parliamentary colleagues are skeptical of the first female prime minister in Japanese history. Focused economic pressure from China just might persuade the party barons to deliver a strong behind-the-scenes message to their leader.

“Ms. Takaichi says Margaret Thatcher is her role model. Let’s hope that this Iron Lady is as tough and resourceful as the first.”

Venezuela: President Trump said his administration may hold talks with Venezuelan President Nicolas Maduro as the U.S. military buildup near the country grows.

“We may be having some discussions with Maduro and we’ll see how that turns out,” Trump told reporters Sunday.  “They would like to talk.”

Last weekend, Trump said he had “sort of” made up his mind about his plan for Venezuela.

The number of strikes on alleged drug-smuggling boats is at 21, with 83 killed.

Bret Stephens / New York Times

“Is there a moral case for regime change? Outside of North Korea, few governments have produced more misery for more of their own people than Venezuela’s. Starvation, political brutality, corruption, social collapse, endemic violence, collapse of the medical system, environmental catastrophes – the only thing more shocking than the self-destruction of this once-rich country is the relative indifference to the catastrophe, at least among the usual do-gooders who otherwise like to anguish over the plight of others.  Why hasn’t Greta Thunberg set sail to Caracas with symbolic deliveries of food?

“Any morally serious person should want this to end. The serious question is whether American intervention would make things even worse….

“What is to be done?  Maduro should be given a final chance to board a flight with whomever and whatever he can take with him and leave unharmed and unpursued – whether to Havana or Moscow or another friendly capital.  Barring that, he deserves the Noriega treatment: capture and transfer to the U.S. to face charges, accompanied by the destruction of Venezuela’s air defenses and command-and-control capabilities, the seizure of its major military bases and arrest warrants for all senior officers – with promises of leniency for those who turn themselves in.

“ ‘If you start to take Vienna, take Vienna,’ Napoleon is said to have told one of his generals.  Same for Caracas, Mr. President.”

Random Musings

–Presidential approval ratings….

Gallup: 41% approve of President Trump’s job performance, while 54% disapprove.  33% of independents approve (Oct. 1-16).

Rasmussen: 47% approve, 51% disapprove (Nov. 21).

The latest Reuters/Ipsos poll conducted Nov. 14-17 has President Trump’s approval rating at 38%, the lowest since his return to power, disapproval 60%.  On his handling of the economy the split is 34-58.

Trump started his second term in office with 47% of Americans giving him a thumbs up.

The president’s approval rating among Republicans in this survey is down to 82% from 87% earlier in the month.

—President Trump’s support among Latino voters is cratering. In October 2024, Trump’s approval rating on immigration among Latinos was two points lower than that of then-Vice President Kamala Harris.  As of November 2025, Trump’s net approval on immigration among that group was -38 points, according to CNN data analyst Harry Enten.

The shift clearly contributed to the Democrats’ big victories in New Jersey and Virginia on Election Day.

—President Trump made a startling reversal late Sunday night, writing on social media that Republicans should vote to release the files in the Jeffrey Epstein case, after previously fighting the proposal as a growing number of those in his own party supported it.

“House Republicans should vote to release the Epstein files, because we have nothing to hide, and it’s time to move on from this Democrat Hoax perpetrated by Radical Left Lunatics in order to deflect from the Great Success of the Republican Party, including our recent Victory on the Democrat ‘Shutdown.’  The Department of Justice has already turned over tens of thousands of pages to the Public on ‘Epstein,’ are looking at various Democrat operatives (Bill Clinton, Reid Hoffman, Larry Summers*, etc.) and their relationship to Epstein, and the House Oversight Committee can have whatever they are legally entitled to, I DON’T CARE!  All I do care about is that Republicans get BACK ON POINT, which is the Economy, ‘Affordability’ (where we are winning BIG!), our Victory on reducing Inflation from the highest level in History to practically nothing, bringing down prices for the American People, delivering Historic Tax Cuts, gaining Trillions of Dollars of Investment into America (A RECORD!), the rebuilding of our Military, securing our Border, deporting Criminal Illegal Aliens, ending Men in Women’s Sports, stopping Transgender for Everyone, and so much more!  Nobody cared about Jeffrey Epstein when he was alive and, if the Democrats had anything, they would have released it before our Landslide Election Victory.  Some ‘members’ of the Republican Party are being ‘used,’ and we can’t let that happen.  Let’s start talking about the Republican Party’s Record Setting Achievements, and not fall into the Epstein ‘TRAP,’ which is actually a curse on the Democrats, not us.  MAKE AMERICA GREAT AGAIN!.”

*Larry Summers said Monday he would be stepping back from public commitments over his correspondence with Jeffrey Epstein.

“I am deeply ashamed of my actions and recognize the pain they have caused. I take full responsibility for my misguided decisions to continue communicating with Mr. Epstein,” Summers said.  He said stepping back from public commitments was “one part of my broader effort to rebuild trust and repair relationships with the people closest to me.”

[Summers resigned from OpenAI’s board, but was going to remain a professor at Harvard, only Wednesday he said he was stepping away from the classroom as well.]

The president’s shift was an implicit acknowledgement that supporters of the measure have enough votes to pass it in the House, although it has an unclear future in the Senate.

Monday, addressing reporters in the Oval Office, Trump said: “All I want is for people to recognize the great job that I’ve done. And I hate to see that deflect from the great job that we’ve done. So I’m all for it [releasing the files].”

Rep. Ro Khanna (D-Calif.) said he was hoping for 40 or more Republicans to join the effort.  “I don’t even know how involved Trump was,” Khanna said.  “There are a lot of other people involved who have to be held accountable.”

Rep. Thomas Massie (Ky.), the GOP sponsor of the discharge petition, had expressed hope that potentially 100 House Republicans who hadn’t signed the petition would vote to release the files.

Trump ran on releasing the files throughout the 2024 presidential race but backed off the pledge since taking office, accusing Democrats of pushing a “hoax.”

The push to release the files also seems to have contributed to the major split between Trump and his longtime ally Rep. Marjorie Taylor Greene (Ga.).

Trump officially pulled his endorsement of Greene in a Truth Social post late Friday, accusing her of having “gone Far Left” and inviting a primary challenge against her.

—Last Friday night, Trump went after Reps. Massie and Greene on Truth Social:

“Did Thomas Massie, sometimes referred to as Rand Paul Jr., because of the fact that he always votes against the Republican Party, get married already???  Boy, that was quick!  No wonder the Polls have him at less than an 8% chance of winning the Election.  Anyway, have a great life Thomas and (?).  His wife will soon find out that she’s stuck with a LOSER!”

What a stupid thing to say…as president, no less.

“I am withdrawing my support and Endorsement of ‘Congresswoman’ Marjorie Taylor Greene, of the Great State of Georgia.  Over the past few weeks, despite my creating Record Achievements for our Country, including a Total and Complete Victory on the Shutdown, Closed Borders, Low Taxes, No Men in Women’s Sports or Transgender for Everyone, ending DEI, stopping Biden’s Record Setting Inflation, Biggest Regulation Cuts in History, stopping EIGHT WARS, rebuilding our Military, being RESPECTED by every Country in the World (as opposed to being the laughingstock that we were just 12 months ago!), having Trillions of Dollars (Record Setting!) INVESTED in the U.S.A., and having created the ‘HOTTEST’ Country anywhere in the World from being a DEAD Country just 12 months ago (and so much more!), all I see ‘Wacky’ Marjorie do is COMPLAIN, COMPLAIN, COMPLAIN!  It seemed to all begin when I sent her a Poll stating that she should not run for Senator, or Governor, she was at 12%, and didn’t have a chance (unless, of course, she had my Endorsement – which she wasn’t about to get!). She has told many people that she is upset that I don’t return her phone calls anymore, but with 219 Congressmen/women, 53 U.S. Senators, 24 Cabinet Members, almost 200 Countries, and an otherwise normal life to lead, I can’t take a ranting Lunatic’s call every day. I understand that wonderful, Conservative people are thinking about primarying Marjorie in her District of Georgia, that they too are fed up with her and her antics and, if the right person runs, they will have my Complete and Unyielding Support. She has gone Far Left, even doing The View, with their Low IQ Republican hating Anchors. Thank you for your attention to this matter. MAKE AMERICA GREAT AGAIN!”

That was at 8:31 PM ET, Friday night.  Followed at 8:40 by:

“Lightweight Congresswoman Marjorie Taylor Brown (Green grass turns Brown when it begins to ROT!), betrayed the entire Republican Party when she turned Left, performed poorly on the pathetic View, and became the RINO that we all know she always was.  Just another Fake politician, no different than Rand Paul Jr. (Thomas Massie), who got caught being a full fledged Republican in Name Only (RINO)! MAKE AMERICA GREAT AGAIN!!!”

Saturday at 9:17 AM ET….

“Marjorie ‘Traitor’ Green [sic] is a disgrace to our GREAT REPUBLICAN PARTY!”

Rep. Greene accused Trump of fueling and egging on “threats” against her as she said she’s having discussions with private security firms amid her escalating rift with the president.

“I am now being contacted by private security firms with warnings for my safety as a hot bed of threats against me are being fueled and egged on by the most powerful man in the world,” Greene posted to X on Saturday. “The man I supported and helped get elected.”

—The House then voted 427-1 Tuesday to force the Justice Department to publicly release its files on Epstein and the Senate moved swiftly after Minority Leader Chuck Schumer made a motion to pass the measure by unanimous consent, no senator objected, and that put the bill directly on Trump’s desk.  Rather stunning.  Trump signed the legislation Wednesday evening.

The president posted on Truth Social:

“Perhaps the truth about these Democrats, and their associations with Jeffrey Epstein, will soon be revealed, because I HAVE JUST SIGNED THE BILL TO RELEASE THE EPSTEIN FILES.”

So what happens now?

The Epstein Files Transparency Act directs Attorney General Pam Bondi to make unclassified documents related to Epstein and his associate Ghislaine Maxwell publicly available within 30 days of being signed into law.

The bill requires a systematic disclosure of documents from the Justice Department including flight logs, internal memos, personal communications, immunity agreements, and more.  The bill allows redactions for victim-identifying information and materials depicting child sex abuse.  An additional report to Congress outlining what was redacted is required within 15 days of publication.

And the Justice Department must justify its redactions to Congress.  This is going to be the big debate between Republicans and Democrats as the president attempts to protect his friends, i.e., big donors.

In a July memo, the Justice Department and FBI said there was no “incriminating client list” of people who paid Epstein for trafficking.  The agencies also said there was “no credible evidence found that Epstein blackmailed prominent individuals as part of his actions.”  The memo concluded that further public disclosure wasn’t warranted, citing victim privacy and court orders.

—Trump on Truth Social, Tuesday:

“THE ONLY HEALTHCARE I WILL SUPPORT OR APPROVE IS SENDING THE MONEY DIRECTLY BACK TO THE PEOPLE, WITH NOTHING GOING TO THE BIG, FAT, RICH INSURANCE COMPANIES, WHO HAVE MADE $TRILLIONS, AND RIPPED OFF AMERICA LONG ENOUGH. THE PEOPLE WILL BE ALLOWED TO NEGOTIATE AND BUY THEIR OWN, MUCH BETTER, INSURANCE. POWER TO THE PEOPLE! Congress, do not waste your time and energy on anything else. This is the only way to have great Healthcare in America!!! GET IT DONE, NOW. President DJT”

—A federal magistrate judge said on Monday that the criminal case against former FBI director James Comey, could be in serious trouble because of a series of apparent errors committed in front of the grand jury by Lindsey Halligan, the inexperienced prosecutor picked by President Trump to handle the matter.

The judge, William E. Fitzpatrick, said that when Ms. Halligan appeared – by herself – in front of the grand jury, she made at least two “fundamental and highly prejudicial” misstatements of the law. He also pointed out that the grand jury materials he ordered Ms. Halligan to turn over to him for his review appeared to be incomplete and “likely do not reflect the full proceedings.”

“The court is finding that the government’s actions in this case – whether purposeful, reckless or negligent – raise genuine issues of misconduct, are inextricably linked to the government’s grand jury presentations and deserve to be fully explored by the defense,” Judge Fitzpatrick wrote.

Wednesday, Halligan admitted to the trial judge that the full grand jury never saw the final version of the charges against Comey.

U.S. District Judge Michael Nachmanoff paused Fitzpatrick’s order to turn over the grand jury materials to Comey until he could complete a review of the fed’s arguments seeking to overturn Fitzpatrick’s ruling.

—David Richardson resigned as acting administrator of the Federal Emergency Management Agency (FEMA).

The move injects even greater uncertainty into the Trump administration’s plans for FEMA, which the president has suggested eliminating or overhauling, with an eye toward shifting more responsibility for disaster response to the states.  A report is expected to be released in the coming weeks detailing the plans to reshape FEMA’s role in disasters across the country.

Richardson was named to the role of acting FEMA administrator in May, replacing Cameron Hamilton, who was pushed out a day after telling members of Congress that FEMA was vital to communities “in their greatest times of need” and should not be eliminated.

Richardson lacked a background in emergency management, which is a legal requirement for the FEMA administrator.  When he was tapped for FEMA, Richardson was the assistant secretary at the Homeland Security Department’s office for countering weapons of mass destruction. Richardson maintained both jobs.

When Richardson joined FEMA, some of his employees expressed concern about his lack of experience.  He told employees in June that he did not know the United States had a hurricane season – a comment that unnerved FEMA employees who heard it.  The agency later said Richardson was joking.

On his first full day as acting administrator, Richardson, who served in the Marines, told the agency’s employees that if any of them tried to obstruct his agenda, “I will run right over you.”

—President Trump on Thursday called for the arrest of Democratic lawmakers who publicly exhorted members of the U.S. military and intelligence communities to disobey any orders they perceived to be illegal, labeling the admonition “SEDITOUS BEHAVIOR AT THE HIGHEST LEVEL” in a Truth Social post.

“Each one of these traitors to our Country should be ARRESTED AND PUT ON TRIAL,” Trump wrote.  He later added that the behavior was “punishable by DEATH!” and reshared a post proclaiming: “HANG THEM GEORGE WASHINGTON WOULD !!!”

The threats came in response to a video released Tuesday of six Congress members with military or intelligence experience, who cautioned the “threats to our Constitution aren’t just coming from abroad, but from right here at home.”

It was not immediately clear which orders concerned the lawmakers, but some representatives have said they are hearing from service members questioning the legality of strikes that have targeted people the Trump administration alleges are trafficking narcotics by sea.

“Our laws are clear,” Sen. Mark Kelly (Ariz.), a Navy veteran, says in the video. “You can refuse illegal orders.”

—White House Press Secretary Karoline Leavitt, when asked to respond to President Trump snapping at another female journalist, this time Bloomberg’s Catherine Lucey, “Quiet! Quiet, piggy.”

“I think everyone in this room should appreciate the frankness and openness that you get from President Trump on a near-daily basis.

“The president is very frank and honest with everyone in this room. You’ve seen it yourself.  You’ve all experienced it yourselves. And I think it’s one of the many reasons that the American people re-elected this president, because of his frankness. And he calls out fake news when he sees it.  He gets frustrated with reporters who lie about him, when you spread fake news about him and his administration.”

Just wanted to get this down for the record.

—A Centers for Disease Control and Prevention webpage that previously made the case that vaccines don’t cause autism now says they might.

The contents of the webpage came up during Health Secretary Robert F. Kennedy Jr.’s Senate confirmation process.  Sen. Bill Cassidy (R-La.) in February said Kennedy had assured him that, if he was confirmed, the CDC would “not remove statements on their website pointing out that vaccines do not cause autism.”

The revised webpage says: “The claim ‘vaccines do not cause autism’ is not an evidence-based claim because studies have not ruled out the possibility that infant vaccines cause autism.  Studies supporting a link have been ignored by health authorities.”

The page previously said: “Studies have shown that there is no link between receiving vaccines and developing autism,” citing a 2012 National Academy of Medicine review of scientific papers and a 2013 CDC study.

Sen. Cassidy on Thursday posted on X: “I’m a doctor who has seen people die from vaccine-preventable diseases.  What parents need to hear right now is vaccines for measles, polio, hepatitis B and other childhood diseases are safe and effective and will not cause autism.  Any statement to the contrary is wrong, irresponsible, and actively makes Americans sicker.”

Kennedy told the New York Times, “I did talk to him,” referring to discussions with Cassidy about the website alteration.  “He disagreed with the decision.”

—

Pray for the men and women of our armed forces…and all the fallen.

Slava Ukraini.

God bless America.

—

Gold $4081…little changed
Oil $57.99

Bitcoin: $84,563 [4:00 PM ET, Friday…down $10,000 on the week…down 33% from the high set Oct. 5]

Regular Gas: $3.09; Diesel: $3.79 [$3.06 – $3.54 yr. ago]

Returns for the week 11/17-11/21

Dow Jones  -1.9%  [46245]
S&P 500  -2.0%  [6602]
S&P MidCap  -0.7%
Russell 2000  -0.8%
Nasdaq  -2.7%  [22273]

Returns for the period 1/1/25-11/21/25

Dow Jones  +8.7%
S&P 500  +12.3%
S&P MidCap  +2.0%
Russell 2000  +6.2%
Nasdaq  +15.3%

Bulls 48.1
Bears 16.7

Happy Thanksgiving!  Travel safe.  Gob-ble Gob-ble (as the late John McLauglin would have said).

Brian Trumbore