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For the week 4/5-4/9
[Posted 10:00 PM ET, Friday]
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I received my first vaccine dose this morning. I obviously didn’t want to do it on a Friday, but when you have the chance, you take it. Actually, I scheduled for the earliest time slot, was first in line, and then I go in and I’m not on their list. We worked things out, and I appreciate a gentleman from Atlantic Health coming up to me, as I was sitting out my 15 minutes after getting injected, apologizing because they took out tomorrow’s vaccination list, not today’s, thus the screwup.
But I was also a little disappointed when I was handed a sheet…Moderna…because everyone I knew who went to this particular center before was getting Pfizer. We all know the deal by now…Moderna’s second dose can have some side effects…more so than Pfizer’s or J&J’s (though now there are some small issues nationwide with J&J…but I emphasize small).
Anyway, I was worried I wouldn’t be able to get much done today but I only had to take two small naps and I feel great. I’ll feel even better in six weeks after the second dose when I don’t have to worry about Covid…at least for a while.
It’s the global variants that worry me. Eventually, everything finds its way here.
The Centers for Disease Control and Prevention said on Wednesday that the highly infectious variant of the coronavirus first identified in Britain is the most common source of new infections in the United States.
And yesterday, Federal Reserve Chair Jerome Powell, while discussing plans to keep the Fed’s super-easy policy in place even as data shows the economy kicking into gear (more below), couldn’t help but throw in a warning on Covid-19.
“Cases are moving back up here, so I would just urge that people do get vaccinated and continue socially distancing. We don’t want to get another outbreak; even if it might have less economic damage and kill fewer people, it’ll slow down the recovery.”
St. Louis Federal Reserve Bank President James Bullard said the Fed should not even discuss changes in monetary policy until it is clear the pandemic is over, tying future Fed discussions tightly to the success of the vaccination effort.
Responsible people are concerned. We have got to get shots in arms, quickly, but even then we have to help vaccinate the likes of India and Brazil, let alone all of Latin America and Africa.
India and Brazil are petri dishes for new variants, some of which our current vaccines may not guard against.
It’s frankly an impossible task. But it starts with telling any Covid deniers and anti-Vaxxers among your friends and family, “Don’t be an asshole…get the freakin’ shot!”
--President Biden released his wish list for the federal budget on Friday, asking for an 8.4% increase in discretionary spending to $1.52 trillion, with substantial gains for education, health care, housing and environmental protection.
The request issued by the White House Office of Management and Budget spells out Biden’s top priorities as Congress weighs its spending plans for next year. It’s the first financial outline of Democrats’ broader ambitions since the expiration of a 2011 law that capped discretionary spending.
Roughly a third of the federal budget consists of discretionary spending, which is funding for the military, foreign policy and domestic programs set by Congress. The rest of the budget involves mandatory spending that is locked-in each year, such as Social Security, Medicare and Medicaid.
Biden, as vice president, struck the deal in 2011 with Sen. Mitch McConnell; a compromise meant to reduce partisan gridlock over an increase to the government’s borrowing authority in return for deficit savings.
But the Biden administration believes the caps caused a decade of severe underinvestment in public services that the president is now trying to turn around with large increases that would mostly bypass national security programs.
The administration now seeks $769 billion in non-defense discretionary funding, which is roughly equal to the 30-year average of spending relative to the overall economy.
Biden, for example, wants to increase the Education Department’s budget 40.8% to $102.8 billion, which includes an additional $20 billion in grants for high-poverty schools.
The Department of Health and Human Services would get a 23.1% boost to $133.7 billion, with additional funds to combat opioid addiction and for the Centers for Disease Control and Prevention.
$861 million is earmarked for investments in Central America to address the forces driving people to migrate to the United States. There are also additional funds to hire 100 new immigration judges and support teams to reduce the large existing backlogs in naturalization and asylum cases.
On defense – the largest department in the discretionary plan – the Biden budget increases spending 1.6% to $715 billion, or only $7 billion less than a spending plan left behind by the Trump administration for fiscal 2022.
The Biden administration pledged to spend billions of dollars on nuclear weapons, long-range weapons, and emerging technologies to counter China, but hinted that it would propose cuts to existing weapons and troops.
Friday’s overall budget request does not include plans for tax revenues or mandatory federal spending. Nor does it include the planned spending in Biden’s infrastructure plan.
These are all just starting points. We’ll be hearing about budget negotiations all summer.
--Wednesday, the Treasury Department released the details of President Biden’s tax plan, which aims to raise as mush as $2.5 trillion over 15 years to help finance his $2 trillion infrastructure package, pushing changes to the tax code that his administration says will ensure American companies are contributing tax dollars to help invest in the country’s roads, bridges, water pipes and in other parts of his economic agenda.
The plan includes bumping the corporate tax rate to 28 percent from 21 percent, imposing a strict new minimum tax on global profits and cracking down on companies that try to move profits offshore.
But just as I said last week with regards to the infrastructure proposal, neither plan is getting passed, at least in nowhere near its current fashion, so it’s a waste of time to discuss both in any great detail.
--Sen. Joe Manchin / Washington Post…Manchin the most powerful man in Washington these days, given the 50/50 Senate…
“When Americans vote to send their two senators to Washington, they trust that they will work to represent the interests of their state on equal footing with 98 other senators. I have always said, ‘If I can’t go home and explain it, I can’t vote for it.’ And I respect that each of my colleagues has the same responsibility to their constituents.
“It’s no accident that a state as small as West Virginia has the same number of senators as California or Texas. It goes to the heart of what representative government is all about. The Founding Fathers understood that the challenges facing a rural or small state would always be very different from a more populous state. Designating each state with the same number of senators – regardless of the population – ensured that rural and small states and the Americans who live in them would always have a seat at the table.
“The filibuster is a critical tool to protecting that input and our democratic form of government. That is why I have said it before and will say it again to remove any shred of doubt: There is no circumstance in which I will vote to eliminate or weaken the filibuster. The time has come to end these political games, and to usher a new era of bipartisanship where we find common ground on the major policy debates facing our nation.
“Think about the recent history. In 2013, Senate Majority Leader Harry M. Reid (D-Nev.) led the charge to change Senate rules to eliminate the filibuster for Cabinet-level nominees and federal judges. I was one of only three Democratic senators to vote against this rule change. In 2017, Senate Majority Leader Mitch McConnell (R-Ky.) proposed to lower the threshold to end debate on Supreme Court nominees to a simple majority. I voted against that change, too. Despite my votes, both rules changes were enacted and the filibuster was weakened, allowing the majority to more easily enact its agenda with little to no input from the minority.
“Every time the Senate voted to weaken the filibuster in the past decade, the political dysfunction and gridlock have grown more severe. The political games playing out in the halls of Congress only fuel the hateful rhetoric and violence we see across our country right now. The truth is, my Democratic friends do not have all the answers and my Republican friends do not, either. This has always been the case.
“Generations of senators who came before us put their heads down and their pride aside to solve the complex issues facing our country. We must do the same. The issues facing our democracy today are not insurmountable if we choose to tackle them together.
“Unfortunately, our leaders in the Senate fail to realize what goes around comes around. We should all be alarmed at how the budget reconciliation process is being used by both parties to stifle debate around the major issues facing our country today. Legislating was never supposed to be easy. It is hard work to address the needs of both rural and urban communities in a single piece of legislation, but it is the work we were elected to do.
“I simply do not believe budget reconciliation should replace order in the Senate. How is that good for the future of this nation? Senate Democrats must avoid the temptation to abandon our Republican colleagues on important national issues. Republicans, however, have a responsibility to stop saying no, and participate in finding real compromise with Democrats….
“We will not solve our nation’s problems in one Congress if we seek only partisan solutions. Instead of fixating on eliminating the filibuster or shortcutting the legislative process through budget reconciliation, it is time we do our jobs.”
--Dozens of America’s biggest companies paid no federal income taxes last year thanks to a range of tax breaks – including some new ones, a new report says.
The 55 corporations avoided a total of $8.5 billion in taxes on more than $40 billion in pre-tax profits in their most recent fiscal year, according to the report from the Institute on Taxation and Economic Policy.
52 of the firms – including household names such as Nike, FedEx and Dish Network – ended up pocketing federal tax rebates worth a collective $3.5 billion, the left-leaning think tank’s analysis found.
And 26 of them haven’t paid a penny in federal income tax in the three years since the Tax Cuts and Jobs Act reform bill was signed into law in 2017, the report says. That group includes shipping giant FedEx and power company Duke Energy, which reported nearly $15 billion in pre-tax income for those three years, according to the findings.
A Duke company spokesperson said Duke paid more than $2 billion in annual state and local taxes in 2020.
Major companies have used loopholes in federal tax law to help their bottom line for decades, the think tank’s researchers note. But they got a fresh boost from the CARES Act, the $2.2 trillion stimulus bill that aimed to help businesses weather the pandemic.
Big firms were able to take advantage of a provision in the bill to use losses they racked up in 2018 or 2019 to offset profits from previous years, which slashed some of their 2020 tax bills to less than zero, according to the report. That measure accounted for at least $500 million of the 55 giants’ tax breaks, the report says.
FedEx stood by the CARES Act tax breaks, saying the law helped it and other companies “navigate a rapidly changing economy and marketplace while continuing to invest in capital, hire team members, and fund employee pension plans.”
But other companies used more established methods for giving themselves tax discounts, including write-offs for paying executives in stock, while others took R&D credits. [New York Post, New York Times]
--I get a kick out of every editorial and opinion piece in the Wall Street Journal these days concerning the Georgia election ‘reforms.’ What’s the problem, they all ask? Who’s against requiring identification to vote to prevent fraud in the future? How can Democrats complain when the hours (in most cases) have been extended? Why voting has been expanded! More early voting, more equipment…blah blah blah.
I’ll be beating this dead horse through November 2022. It’s not about any of the above. It’s about the actions being taken by the state to give it the power to influence local election boards, to decertify votes, in essence. To disenfranchise.
Tom Krattenmaker / USA TODAY
“Tucked inside the new Georgia elections law is a measure that shifts a significant amount of election oversight power from the secretary of state and county election boards to the legislature. The measure removes the elected secretary of state as chair of the state election board and replaces him or her with an appointee of the Republican-run legislature.
“Such a coincidence! Just a few months after Secretary of State Brad Raffensperger says ‘no’ to magical vote-finding, the legislature takes a chunk of power and authority from his office and shifts it to someone of their choosing – and, we can only assume, more likely to do their bidding.
"The law doesn’t just change who picks the chair. Now, the majority of the board’s members will be legislative appointees, and the board gains ominous new power: the ability to remove and replace election officials administering the vote at the level where the real elections work happens – the county level.
“Let’s say the state board does not like the way vote-counting is going in heavily Democratic Fulton County. Under the new law, the board can fire those in charge and plop in a new boss more to its liking.
“ ‘After the November election last year,’ Gov. Brian Kemp said as he signed the bill into law, ‘I knew…that significant reforms to our state elections were needed.’
“Given that no one has produced evidence of large-scale cheating, fraud, counting dead people’s votes, or losing living people’s votes, I think we know what Kemp sees as needing ‘reform’: Democrat Joe Biden’s victory in previously red Georgia.”
It’s so clear what is going on…but many of my fellow Republicans keep putting up the smoke screens. In 2022, we will have state election boards changing, manipulating outcomes; not just in Georgia, but other states are planning changes that would do the same. That should scare the hell out of you. I can’t stop thinking about the prospect, to tell you the truth, as this is exactly what Donald Trump was trying to do all the way up to Jan. 6.
Hell, the guy is facing two grand juries in Georgia over the very topic.
By the way, I’m against the MLB boycott of Atlanta and the All-Star Game, but I’ll let former commissioner Fay Vincent speak for me down below.
--In his first gun control measures since taking office, President Biden announced a half-dozen executive actions Thursday aimed at addressing a proliferation of gun violence, the latest episode in South Carolina Wednesday, when a former NFL player took out five at a local doctor’s residence.
“It is actually a public health crisis,” Biden said during remarks at the White House. Greeting the families of gun violence victims and activists, he assured them: “We’re absolutely determined to make change.”
But Biden’s announcement underscored the limitations of his executive power to act on guns. They include moves to tighten regulations on homemade guns (ghost guns) and provide more resources for gun-violence prevention; but fall far short of the sweeping gun-control agenda Biden laid out on the campaign trail.
Biden is also tightening regulations on pistol-stabilizing braces, like the one used by the Boulder, Colorado, shooter in a rampage last month that killed 10.
Additionally, Biden is nominating David Chipman, a former federal agent and adviser at the gun control group Giffords, to be director of the Bureau of Alcohol, Tobacco, Firearms and Explosives. Chipman spent 25 years as an agent at the ATF. He’s an explosives expert and was among the team involved investigating the Oklahoma City bombing and the first World Trade Center bombing.
Bruce Aylward, senior adviser to the director general of the World Health Organization, said at a briefing today that when it comes to Brazil, “What you are dealing with here is a raging inferno of an outbreak.” As I detail below, the deaths here are sickening, but it was a week that saw new record highs in deaths and/or cases in the Philippines, Poland, Ukraine, Turkey and India, for starters. Deaths in Italy are also back to levels last seen in January.
Covid-19 death tolls, as of tonight….
U.S. daily death tolls…Sun. 270; Mon. 524; Tues. 906; Wed. 873; Thurs. 1,009; Fri. 929.
--President Biden announced that all American adults will be eligible to get the Covid-19 vaccine by April 19, nearly two weeks ahead of schedule. Biden is pushing all states to open up their vaccine programs to residents 16 and over. Many states have already done so. I would just hope the over 65 age group is still given priority.
According to a new Gallup poll, Americans’ satisfaction with the rollout of the vaccine has surged, and their concerns about getting the virus and about the availability of coronavirus tests and hospital services/treatment have fallen to record lows.
Thirty-five percent of U.S. adults now say they are very or somewhat worried about contracting Covid-19, the lowest point in Gallup’s trend since April 2020. Twenty-two percent of Americans are very or moderately worried about access to hospital service/treatment, and 14% are just as worried about access to Covid-19 tests.
The current 35% worried about contracting Covid-19 is down 14 percentage points from February, and well off the record-high 59% of Americans who voiced concerns about catching the disease last summer.
--Nearly half of new coronavirus infections nationwide are in just five states – a situation that is putting pressure on the federal government to consider changing how it distributes vaccines by sending more doses to hot spots.
New York, Michigan, Florida, Pennsylvania and New Jersey together reported 44% of the nation’s new infections in the latest available seven-day period, according to data compiled by Johns Hopkins University.
--California will “fully reopen its economy” by June 15, ending Covid restrictions, Governor Gavin Newsom said Tuesday, provided there is “sufficient” vaccine supply and “stable and low” hospitalization rates.
--Britain should not give Oxford/AstraZeneca’s Covid-19 vaccine to under 30s where possible, Britain’s Joint Committee on Vaccination and Immunization (JCVI) said on Wednesday, due to a very rare side effect of blood clots in the brain. The chair for JCVI, Wei Shen Lim, said that based on the available data and evidence, the committee has advised that it is preferable for adults aged under 30 with no underlying conditions to be offered an alternative to the AstraZeneca vaccine where available.
“We are not advising a stop to any vaccination for any individual in any age group. We are advising a preference for one vaccine over another vaccine for a particular age group, really out of the utmost caution, rather than because we have any serious safety concerns,” Lim said.
--Britain’s comments came as Europe’s drug regulator found a possible link between AstraZeneca’s vaccine and rare blood clots in adults who had received the inoculation. The announcement is a fresh setback for the vaccine, which is sold at cost, for a few dollars a dose, and is by far the cheapest and most high-volume launched so far.
But Emer Cooke, executive director of European Medicines Agency (EMA) said, “The risk of mortality from Covid is much greater than the risk of mortality from these rare side effects.”
Nonetheless, this will result in a major loss of confidence in taking the vaccine.
--Germany’s vaccine committee then said instances of rare clotting in people who got the AstraZeneca vaccine were 20 times higher than would be likely in the same time period among a specific age group.
This afternoon French health officials said people under 55 who received a first dose of the AstraZeneca vaccine should get other vaccines for their second shot because of the clotting issue.
--Johnson & Johnson will not be able to deliver 24 million doses by the end of April as the company had previously promised. Next week, the government will supply only 700,000, rather than 5 million doses of its single-shot vaccine.
--The British government is working through complicated ethical issues posed by Covid-19 vaccine certification before deciding how the so-called vaccine passports can best be used, Prime Minister Boris Johnson said on Monday.
Johnson said there would be no need for people to prove they had been vaccinated for the reopening of shops and pub gardens next week, adding that the idea of vaccine passports for international travel was likely and its use domestically would be piloted at some big events.
“I want to stress that there are complicated, ethical, and practical issues…raised by the idea of Covid status certification…using vaccination alone,” Johnson told a news conference. “You’ve got to be very careful in how you handle this, and don’t start a system that’s discriminatory.”
--Brazil recorded its first confirmed case of the highly contagious Covid variant discovered in South Africa, a fresh danger for a country already ravaged by the world’s worst daily death toll and scrambling to make space for burials. Scientists also warned on Wednesday that yet another new variant could be emerging in Brazil’s inland city of Belo Horizonte.
On Tuesday the Health Ministry reported a single-day record of 4,195 deaths, followed by another 3,829 on Wednesday, and then 4,190 on Thursday. Sao Paulo, the country’s biggest city, said it would begin opening some 600 new graves per day, well beyond the record of 426 burials in a day on March 30. The city is also finalizing plans for a “vertical cemetery,” a crypt with 26,000 drawer-like graves that can be built in 90 days once approved.
President Jair Bolsonaro has finally shifted his tone on vaccines, touting shots he had until recently disdained. But the far-right former army captain still opposes social distancing and mask mandates that Brazil’s health experts see as essential.
--India has recorded its highest-ever number of daily Covid-19 cases a few times this week as its fight to curtail a renewed wave of infections is beset by vaccine shortages in several states and cities, including Mumbai.
Only 11 million have received both doses of the vaccine as the country tries to build immunity to protect its population of nearly 1.4 billion people.
Dozens of cities and towns are imposing night curfews to try to contain the surge but the federal government has refused to impose a second nationwide lockdown for fear of hurting the economy.
New Zealand on Thursday temporarily suspended entry for all travelers from India, including its own citizens, for about two weeks following a high number of positive coronavirus cases arriving from India, 17 of 23 new cases recorded at its border on Thursday.
[Separately, New Zealand and Australian residents will be able to travel between the two nations without having to quarantine from April 19.]
--South Korea reported 700 new coronavirus cases, its highest daily figure since early January, and the Prime Minister reiterated warnings on Thursday that new social distancing rules would likely be needed. Wednesday’s tally compares with an average of 477 cases last week, according to data from the Korea Disease Control and Prevention Agency and will fuel fears that the country may be facing a fourth wave of infections.
South Korea also said it will temporarily suspend providing AstraZeneca’s Covid-19 vaccine to people below 60 as it undergoes reviews in Europe. It did approve a Johnson & Johnson shot in a bid to speed up its inoculation rollout.
--Japan’s inoculations are lagging well behind other major economies. Only a million have received the first dose of the Pfizer vaccine since February, out of its population of 126 million, and the more vulnerable elderly do not even start getting their shots until next week.
New infections have spiked ahead of the Olympics, which are set to start in July. Tokyo saw 545 new cases on Thursday and its governor said she would ask the central government to impose emergency measures in the capital region.
The Olympics are hugely unpopular in Japan, with up to 80 percent of Japanese wanting the Games cancelled or postponed again.
--North Korea’s sports ministry said on Tuesday that it will not participate in the Tokyo Olympics to protect its athletes from the pandemic. North Korea has one of the world’s strictest quarantine regimes, despite the government’s denial that any cases have been detected in the country.
Wall Street and the Economy
The global economy is likely to expand this year at the fastest pace in at least four decades as vaccine rollouts accelerate and advanced economies spend aggressively to counter the pandemic and related lockdowns, the International Monetary Fund said on Tuesday, as part of its semiannual World Economic Outlook.
The IMF expects the world economy to grow 6% this year, the most since 1980, when it started tracking data on a comparable set of countries. That is an upgrade from a projection for 5.5% growth the IMF made in January. The pandemic cut global output by an estimated 3.3% in 2020, the worst peacetime outcome since the Great Depression. The IMF pegs 2022 growth at 4.4%.
The U.S. and China, the world’s biggest economies, are driving the recovery. The U.S. economy is projected to expand 6.4% in 2021 and regain its pre-pandemic size after an estimated contraction of 3.5% last year. The IMF earlier projected 5.1% growth in 2021. The 2022 U.S. growth rate is pegged at 3.5%. China’s economy is projected to expand 8.4% this year, up from an earlier forecast of 8.1%, and 5.6% in 2022. It grew 2.3% in 2020, best in the world.
Japan is expected to grow 3.3% this year, 2.5% next.
The euro area’s growth forecast improved more modestly to 4.4% in 2021 from the prior forecast of 4.2%, and 3.8% in 2022. The eurozone shrank 6.6% last year.
Growth in the UK is forecast to be 5.3% in 2021, and 5.1% next year. Canada is expected to see growth of 5% this year and 4.7% in 2022.
Washington has pledged to spend roughly $5 trillion since last spring to battle the pandemic, including the $1.9 trillion package approved in March. At the same time, the Federal Reserve was slashing short-term rates to zero while buying $trillions of dollars in securities. Other advanced economies have pursued similar strategies.
Amid the diverging economic fortunes, Gita Gopinath, the IMF’s chief economist, cautioned the U.S. and other wealthy nations against tightening monetary policy prematurely. Higher interest rates in advanced economies could increase borrowing costs and debt burdens for countries that rely on overseas financing while drawing away investment capital.
“Major central banks should provide clear guidance on future actions with ample time to prepare to avoid taper-tantrum kinds of episodes,” she said, referring to 2013, when the Fed’s unexpected suggestion that it might tighten policy sent Treasury yields soaring.
On an issue brought up this week by U.S. Treasury Secretary Janet Yellen, who called for the adoption of a global minimum tax on corporate profits, Gita Gopinath said the IMF has long favored it, saying current disparities in national corporate tax rates had triggered “a large amount” of tax shifting and tax avoidance, reducing the tax base on which governments could collect revenues to fund needed economic and social spending. French Finance Minister Bruno Le Maire said on Tuesday a global deal on cross-border taxation was within reach as he welcomed Yellen’s pledge to work on a global corporate minimum rate.
Yellen said in a speech to the Chicago Council on Global Affairs on Monday:
“Together we can use a global minimum tax to make sure the global economy thrives based on a more level playing field in the taxation of multinational corporations, and spurs innovation, growth, and prosperity.”
The U.S. is already pushing for a multilateral agreement on digital taxation at the OECD by the summer, but Yellen wants a broader deal on corporate taxation encompassing the G20 and other countries.
She also stressed that the U.S., in the wake of the unilateralism of Donald Trump’s presidency and in the face of global challenges including the fight against the pandemic and climate change, will work with its allies.
“America first must never mean America alone. For in today’s world, no country alone can suitably provide a strong and sustainable economy for its people. Over time, a lack of global leadership and engagement makes our institutions and economy vulnerable,” she said.
I don’t see it, a global deal on cross-border taxation, especially with the G20. I won’t waste my time on this topic again until I see something at even the G7 level.
In his annual shareholder letter that is widely followed as head of the biggest U.S. bank, JPMorgan Chase CEO Jamie Dimon said on Wednesday the United States could be in store for an economic boom through 2023 if more adults get vaccinated and federal spending continues.
Calling it a “Goldilocks moment – fast and sustained growth, inflation that moves up gently (but not too much) and interest rates that rise (but not too much),” Dimon added: “I have little doubt that with excess savings, new stimulus savings, huge deficit spending, more QE (quantitative easing), a new potential infrastructure bill, a successful vaccine and euphoria around the end of the pandemic, the U.S. economy will likely boom,” Dimon wrote. “This boom could easily run into 2023 because all the spending could extend well into 2023.”
The average U.S. consumer’s finances are in “excellent shape,” Dimon said, and the stock market’s high valuations are justified. The price of U.S. treasuries, however, are not, he wrote.
The economic growth Dimon projects the United States could see in the next two years will create opportunities to “deal with issues stemming from inequality,” he wrote. Dimon called for raising the federal minimum wage, improving training for jobs at high schools and colleges and making it easier for people with criminal records to get jobs.
Dimon, who has called for higher taxes to pay for federal stimulus, said corporations could support many of these initiatives if the government adopted rigorous budgeting, transparency and discipline when it comes to its spending.
“We must remember that the concepts of free enterprise, rugged individualism and entrepreneurship are not incompatible with meaningful safety nets and the desire to lift up our disadvantaged citizens,” Dimon wrote.
In an interview with the Wall Street Journal, Dimon said, “[Taxes] are going to have to go up; you can’t run a 10% to 15% deficit forever. If people thought their taxes were going toward helping the poor and disadvantaged, they would much prefer to pay a higher amount.”
Any changes to the corporate-tax rate, he said, should be “reasonable and moderate” to keep the U.S. competitive with other countries.
Incidentally, last year Dimon’s outlook was dark, as he warned shareholders to brace for a “bad recession” in which gross domestic product could fall by up to 35%, which was quite accurate when it came to the second quarter of 2020.
In the Federal Reserve’s minutes from last month’s meeting (March 16-17), officials were encouraged by evidence the economy was picking up, but they showed no sign of moving closer to ending their bond purchases or lifting their benchmark short-term interest rate from nearly zero.
Fed policymakers also said they expect inflation will likely rise in the next few months because of supply bottlenecks, but they believe it will remain near their 2% target over the longer run.
Wednesday, Charles Evans, president of the Federal Reserve Bank of Chicago, said in prepared remarks, “All told, even though the economy is recovering, we still have a long way to go before economic activity returns to its pre-pandemic vibrancy.”
Dallas Fed Bank President Robert Kaplan said during a virtual discussion Wednesday that the Fed should begin to withdraw monetary support soon after the pandemic is over, as in the scale of its asset purchases from the current pace of $120 billion a month, though he stopped short of saying that the purchases must end completely before the Fed lifts interest rates.
“My thought is the tapering would come first. I think in my mind it would be substantially completed before you deal with the Fed funds rate, but I would like to retain flexibility on that.”
Thursday, speaking at an International Monetary Fund event, Fed Chair Jerome Powell said a surge in spending as the U.S. economy reopens, along with bottlenecks in supply, will likely push prices higher this year, but would not result in the kind of year after year price rises that would constitute inflation.
“We think there will be an upward pressure on prices which may be passed along to consumers in the form of price increases – we think that that will be temporary,” Powell said. “If inflation were unexpectedly, counter to our expectations, to move meaningfully above levels where we are comfortable – and in particular inflation expectations…if we see them moving persistently and materially above levels we are comfortable with, then we would react to that.”
Powell said it’s important to remember the millions of people that are still out of work due to the pandemic, though the overall economy continues to recover. And towards that end, this week’s jobless claims figure was disappointing, 744,000, up from the prior week’s 728,000.
Overall, employment still remains about 8.4 million below its pre-pandemic peak.
Meanwhile, in other economic news, the ISM non-manufacturing reading for March was a robust 63.7 (50 the dividing line between growth and contraction), well above consensus of 59.2 and the best since Oct. 2018.
February factory orders were down 0.8%
And today we had the March producer price data, which was much higher than expected, 1.0%, 0.7% ex-food and energy. For the last 12 months, the PPI is up 4.2%, the biggest year-on-year rise since Sept. 2011, 3.1% on core, its biggest rise since Sept. 2018.
So we’ll see what happens next week with consumer prices, and in succeeding months. There was no panic in the bond market with today’s numbers.
Finally, the Atlanta Fed’s GDPNow barometer for the first quarter stands at 6.0%.
Europe and Asia
--We had the release this week of the eurozone (EA19) PMIs for the service sector for March (courtesy of IHS Markit), with a final EA19 reading of 49.6 vs. February’s 45.7. The final eurozone composite (including last week’s manufacturing data) was 52.5 vs. 48.8 the prior month.
Service sector readings for March:
Germany: 51.5 vs. 45.7 Feb.
Italy: 48.6 vs. 48.8
Ireland: 54.6 vs. 41.2…quite a jump
And the UK…56.3 vs. 49.5
Chris Williamson / IHS Markit
“Eurozone business activity bounced back in March, returning to growth after four months of decline with an even stronger expansion than signaled by the forecast-beating ‘flash’ data.
“Manufacturing is booming, led by surging production in Germany, and the hard-hit service sector has come close to stabilizing as optimism about the outlook improved further during the month. Firms’ expectations of growth are running at the highest level for just over three years amid growing hopes that the vaccine roll-out will boost sales in the coming months.
“Strengthening demand has already led to the largest rise in backlogs of uncompleted work seen for almost three years, encouraging increasing numbers of firms to take on additional staff. Improving labor markets trends should help further lift consumer confidence and spending as we head into the second quarter.
“The survey therefore indicates that the economy has weathered recent lockdowns far better than many had expected, thanks to resurgent manufacturing growth and signs that social distancing and mobility restrictions are having far less of an impact on service sector businesses than seen this time last year. This resilience suggests not only that companies and their customers are looking ahead to better times, but have also increasingly adapted to life with the virus.”
Separately, euro area unemployment for February came in at 8.3%, unchanged from January and up from 7.3% in Feb. 2020.
Germany 4.5%, France 8.0%, Italy 10.2%, Spain 16.1%, Ireland 5.8%, Netherlands 3.6%.
Brexit: In a very unsettling development, Northern Ireland has been beset by sectarian violence amid growing frustration among many pro-British unionists at new post-Brexit trade barriers between Northern Ireland and the rest of the United Kingdom that many warned could be a trigger for violent protests.
British Prime Minister Boris Johnson said he was “deeply concerned” by the violence, which has injured dozens of police officers in recent days, but rather remarkably, no deaths as yet. Johnson’s Irish counterpart, Micheal (sic) Martin, called on Dublin, London and all parties in Northern Ireland to work together to ease tensions and restore calm.
Deputy First Minister Michelle O’Neill, of the Irish nationalist Sinn Fein party, part of the compulsory power-sharing coalition led by Irish nationalists and their unionist rivals in Northern Ireland, tweeted, “Those involved in violence, criminal damage, manipulation of our young people and attacks on the police must stop.”
Parts of the region remain deeply split along sectarian lines, 23 years after a peace deal largely ended three decades of bloodshed. Many Catholic nationalists aspire to unification with Ireland while Protestant unionists want to stay in the UK.
Today, it’s all about the new levels of inspection of goods and the added levels of bureaucracy that are killing some of the North’s businesses, post-Brexit. And as for Dublin, it is straddling a precarious line between its interests in the North and its responsibilities to the EU.
--Turning to Asia…the private Caixin services reading for March in China was a solid 54.5 vs. 51.5 in February.
Separately, in another sign the economy is gaining momentum, producer prices for March rose 4.4% year-over-year, while consumer prices increased just 0.4% Y/Y.
In Japan, the non-manufacturing PMI for March was 48.3% vs. 46.3 in February, the 14th straight month of contraction.
February household spending was down a third straight month, -6.6% year-over-year, amid further curbs to prevent the spread of the coronavirus. There is definitely a lot of pent-up demand here, but when? The government has been putting on new restrictions.
--The market rally continues, more new highs in the Dow Jones and S&P 500 this week, including Friday. The softer jobless claims data helped boost the Fed’s dovish policy, as yields fell, helping the tech sector, while we see continued progress in vaccine distribution.
For the week the Dow Jones rose 2.0% to 33800, while the S&P 500 gained 2.7% to its new high of 4128. Nasdaq was up 3.1% and is now just a good day’s rally from its all-time mark.
Next week commences earnings season, with the major banks reporting. Many of the bigger companies have not been issuing guidance during the pandemic, saying there was too much uncertainty to issue a forecast. But now it’s expected that Corporate America will be more forthcoming as the economy continues to reopen.
The S&P 500 is expected to see a robust 25% gain in earnings for the quarter.
--U.S. Treasury Yields
6-mo. 0.03% 2-yr. 0.16% 10-yr. 1.66% 30-yr. 2.33%
Despite the big producer price number, the bond market just shrugged and the yield on the 10-year fell from 1.72% the week before (and 1.77% intraday).
--Crude oil fell back below $60 this week for the first time in seven weeks, closing at $59.34 on West Texas Intermediate.
--Credit Suisse Group AG is careening from one crisis to another and then another – this time, with a $4.7 billion writedown tied to billionaire investor Bill Hwang’s trading blowout.
The staggering hit – the largest yet linked to market-shaking losses at Hwang’s Archegos Capital Management – prompted sweeping management changes at the Swiss Bank Tuesday and cast fresh doubt on its checkered record of managing risks. It’s been a catalog of costly errors at the bank – most recently the collapse of Greensill Capital – in what was supposed to be the start of a steadier era under CEO Thomas Gottstein.
At a moment when investment banks are feasting on market activity and dealmaking, Credit Suisse is under mounting pressure to persuade shareholders and clients it can put its house in order and remain a vital, independent force in global banking.
Gottstein vowed he will draw “serious lessons” as the Archegos loss and the collapse of Greensill Capital last month leave him with little room for further missteps. The firm is the worst-performing major bank stock in the world this year as a strong first two months for its investment bank business are being overshadowed by its exposure to the failed firms.
Most analysts believe at this point CSG needs to pursue a strategy of capital preservation before it can think about a restart.
--The European Union’s slow Covid-19 vaccine rollout will damage Ryanair’s prospects in the coming year, Europe’s biggest low-cost airline said on Wednesday, while saying it expected a smaller than expected loss for its financial year just ended.
“Easter travel restrictions/lockdowns and a delayed traffic recovery into the peak Summer 21 season, due to the slow rollout in the EU of Covid-19 vaccines, means that FY22 traffic is likely to be towards the lower end of our previously guided range,” it said in a statement.
Ryanair flew 27.5 million passengers in the last 12 months, down from 149 million passengers in the year to March 2020, before the pandemic had a significant impact.
--Major British airline Jet2 said it was cancelling holidays until late June, blaming uncertainty from UK government plans for restarting international travel that were widely condemned by airlines.
Carriers had been counting on government proposals published on Friday to kick off a summer getaway season, but the industry criticized the release for not including a start date for travel or listing which countries would be open for holidaymakers. Instead it will give more details in early May, ahead of a possible resumption of international travel on May 17.
Jet2, the UK’s third largest carrier by passenger numbers, said it had cancelled flights and holidays to June 24. “The uncertainty is just a killer,” said CEO Steve Heapy.
Competitor airlines and travel companies still hope to be able to open some routes from May 17, but they warn that expensive Covid-19 testing requirements will dent demand.
In 2019, more than six in 10 Britons took a foreign holiday. But before the summer season can take off, airlines need to retrain pilots and holiday companies need to take on seasonal staff, both for operations at home and in resort. Jet2 said it needs to hire up to 3,500 staff to reopen resorts in countries like Spain, Greece and Turkey.
The UK government, having seeing a dramatic decline in Covid cases due to a strict lockdown, fears the arrival of vaccine-resistant variants from abroad that could undermine the inoculation program, which has been robust in Britain, compared with its European neighbors.
--TSA checkpoint travel numbers…vs. 2019
4/8…61 percent of 2019 level
4/2…64…post-pandemic high….1,580,785 travelers
--The aforementioned Jamie Dimon said the pandemic will “significantly reduce our need for real estate” as fewer workers return to the office after the scourge finally passes.
“Remote work will change how we manage our real estate,” he wrote in his shareholder letter.
Dimon said the bank, for years New York’s largest commercial tenant and private-sector employer, will move to more open-seating arrangements and only 60 chairs may be needed for every 100 employees because not everyone will come to the office at the same time. He estimated “maybe 10% of staffers would work from home full-time.” The bank still intends to complete the rebuilding of its 270 Park Avenue headquarters, which will house 12,000 to 14,000 employees.
--General Motors says it is extending production cuts at some of its North America factories due to the global chip shortage. The move’s impact has been factored into GM’s 2021 profit forecast, which assumes a hit of up to $2 billion.
GM says it has not taken downtime or reduced shifts at any of its more profitable full-size truck or full-size SUV plants due to the shortage.
--According to China’s Midea Group, the world’s largest manufacturer of consumer appliances, including refrigerators, washing machines and air conditioners, the global shortage in semiconductors has impacted Midea’s production, the company said in a statement.
Midea, which is headquartered in Foshan, a city in southern Guangdong province, said the prices of chips used for home appliances, which are generally less sophisticated than those used in smartphones and laptop computers, are poised to increase as the global shortfall of chips persists.
China produces about two-thirds of the world’s air conditioners, televisions and microwave ovens, and about half of refrigerators and washing machines, according to data from the China Household Electrical Appliances Association.
--Samsung Electronic Co. Ltd. on Wednesday said first-quarter profit likely rose 44%, with analysts attributing the surge to brisk sales of smartphones and TVs, albeit tempered by a likely fall in chip earnings after a storm halted U.S. output.
The South Korean tech giant forecast Jan.-Mar. operating profit of $8.32 billion, with revenue likely rising 17% from the same period a year earlier.
Samsung’s flagship Galaxy S21 smartphone series outsold the previous version by a two-to-one margin in the six weeks since its January launch. A lower starting price helped sales for the world’s largest smartphone maker during the quarter with the S21 priced $200 lower than the S20, according to research provider Counterpoint.
--Meanwhile, private equity firm CVC Capital Partners is proposing taking Toshiba Corp. private in a deal worth about $20 billion, as the Japanese tech giant faces pressure from activist shareholders to improve its governance. If realized, the deal will shield management of the scandal-hit conglomerate from scrutiny amid calls from large overseas shareholders for greater transparency from the board.
An acquisition of Toshiba, one of Japan’s few manufacturers of nuclear power reactors, needs government approval.
--Norwegian Cruise Line said Tuesday it is planning to resume cruises from the U.S. in July, and has asked the U.S. Centers for Disease Control and Prevention to lift the conditional sail order.
If approved, cruises from U.S. ports are expected to start on July 4. The company formed a special committee, led by a former U.S. Food and Drug Administration official, to help implement safety measures, including mandatory vaccinations for crew and guests, as well as testing.
Further, the company said it also plans to resume voyages embarking outside of the U.S. in phases, with sailings originating in Jamaica, Dominican Republic and Greece. Cruises will begin on July 25 from Athens, on Aug. 7 from Jamaica, and on Aug. 15 from the Dominican Republic.
Under the plan submitted to the CDC, Norwegian will require all guests and crew to be fully vaccinated at least two weeks prior to their departure and work schedule, respectively. The company will also implement universal testing to create a “safe, bubble-like” environment.
“With vaccine mandates and strict health and safety protocols in place, we believe we can provide a uniquely safe and healthy vacation experience,” CEO Frank Del Rio said in the letter. “With our vessels back in operation, we will not only reinstate thousands of American jobs and meet the significant consumer demand for cruising, but also re-contribute billions of dollars to the U.S. economy as the industry resumes cruise operations.”
Norwegian will initially operate at a reduced capacity of 60% and raise the capacity every 30 days by 20%.
But the CDC has not responded and they are facing heat to do so. Their policies have been the model of inconsistency thus far.
--Yum Brands Inc.’s Taco Bell said on Tuesday it would hire at least 5,000 workers at an April job fair as it looks to support a planned expansion of U.S. restaurants. The chain said outdoor hiring parties will take place at almost 2,000 U.S. restaurants on April 21.
--Greenland held a crucial snap election on Tuesday. The Arctic island of 56,000 people is part of the Kingdom of Denmark but has broad autonomy.
Why are the results important? International companies were watching the vote closely as they compete for the right to develop Greenland’s untapped deposits of rare earth metals including neodymium, which is used in wind turbines, electric vehicles and combat aircraft.
Global warming and melting ice have made Greenland more attractive for investment as access by sea has become easier.
But concern in Greenland has been mounting about the potential environmental impact of plans to build a large mining complex in the south of the island, a site that contains uranium as well as neodymium.
And because we’re talking rare earth minerals, China is a big part of this story.
Greenland’s mining potential is widely seen as vital to its prospects of achieving more economic independence, as its $3 billion economy and large public sector are heavily reliant on grants from Denmark. A majority of Greenlanders view independence from Denmark as a long-term goal but say economic development is needed first.
So then the results came in and Greenland’s left-wing and environmentalist party, Inuit Ataqatigiit (IA), picked up 37% of the vote, while the incumbent center-left party Siumut, meaning Forward, only garnered 29% after backing the mining project. Mute Egede (you’ll be quizzed on these names), the 34-year-old leader of IA, which opposed the project, will now try to form a coalition government.
For now, this is a big blow to Beijing as it sought to increase its grip on the world’s rare earths. China currently mines over 70% of the product.
The Greenland project in Kvanefjeld was expected to produce 10% of the world’s rare earths, according to Greenland Minerals Ltd., an Australia-based firm that holds the project’s exploratory license. [China owns a majority of the shares in the company.]
--The Empire State Building in New York, the one that years ago Kong scaled, is owned by an entity, the Empire State Realty Trust.
Needless to say, 2020 was a dismal year for the property as tenants and tourists vanished. Shares in the trust shed nearly a third of their value and last summer the company suspended its dividend to conserve cash. A big move since investors buy stocks in real estate investment trusts specifically to collect generous dividends.
But as Crain’s New York Business reported, the problems at the iconic property didn’t hurt CEO Anthony Malkin, whose “realized compensation” came in at $5.4 million, according to a regulatory filing, a meager drop of just 5%, or $300,000, from 2019. Including deferred pay, Malkin was awarded $10.1 million, or $1 million less than before the pandemic.
Empire State Realty let go of 9% of its workforce last year.
--Manhattan’s residential real-estate market, which had cratered after many New Yorkers fled at the start of the pandemic, closed the first quarter of this year by posting its strongest sales in years.
In March, around 1,500 Manhattan residences were in contract for sale; the highest number of deals for any one month in 14 years.
Buyers are taking advantage of low mortgage rates and lower prices, though only down about 4% from prior sky-high levels. Condos, for example, in Manhattan sold for $1.55 million in the first quarter, according to Douglas Elliman, which was down 4.7%.
By May of 2020, as fears of Covid spread, Manhattan residential prices were down nearly 11% from the start of the year, according to UrbanDigs. [Kate King / New York Post]
--Back to Kong, his latest feature role, “Godzilla vs. Kong,” took in a very solid $48.5 million at domestic theaters between its release a week ago Wednesday and Sunday, giving it the most prolific North American opening of any movie during the Covid-19 pandemic. It made nearly $122 million internationally two weekends ago, then added another $120 million last weekend.
I’m assuming Kong gets a percentage of the gross. Godzilla, being a dinosaur, receives nothing.
--Topps, a producer of chewing gum, candy, and collectibles, said Tuesday it has agreed to go public by merging with blank-check company Mudrick Capital Acquisition II.
The deal, which is set to close in late Q2 or early Q3, implies a pro forma enterprise value for the combined company of $1.3 billion.
The merged company will be named Topps and remain listed on Nasdaq under the new ticker symbol “TOPP.”
The transaction will generate gross proceeds of up to $571 million of cash.
Topps was bought in 2007 by former Disney CEO Michael Eisner, who will remain chairman of the board.
As Eisner put it, “Everybody has a story about Topps,” and buying it in 2007 was a bet on a brand that elicits an “emotional connection” as strong as Disney, he said.
Topps has focused on a shift to digital, starting online apps for users to trade collectibles and play games. It also continues to see value in its core baseball-card business, with the secondary card market white hot.
--Finally, Amazon.com has apologized to U.S. Representative Mark Pocan (D-Wis.), admitting to scoring an “own goal” in its initial denial of his suggestion that its drivers were sometimes forced to urinate in bottles during their delivery rounds. “We know that drivers can and do have trouble finding restrooms because of traffic or sometimes rural routes, and this has been especially the case during Covid when many public restrooms have been closed,” the company said in a blog post.
The admission came a week after the Democrat criticized Amazon’s working conditions, saying in a tweet: “Paying workers $15/hr. doesn’t make you a ‘progressive workplace’ when you union-bust & make workers urinate in water bottles.”
Amazon initially issued a denial, saying in a tweet: “You don’t really believe the peeing in bottles thing, do you? If that were true, nobody would work for us.”
The company was forced to walk it back.
Allegations by many workers of a grueling or unsafe workplace have turned unionizing the company into a key goal for the U.S. labor movement.
But the labor movement suffered a big defeat today when workers at an Amazon warehouse in Bessemer, Alabama voted 1,798 to 738 (with 500 ballots in dispute) not to join the Retail, Wholesale, and Department Store Union.
Amazon’s hardball approach overcame its biggest labor challenge so far, but now it’s Jeff Bezos vs. Joe Biden.
The thing is $15 an hour goes far in Bessemer. Not everyone is unhappy.
Iran: Representatives from Iran, China, Russia, Germany, France and Britain convened in Austria this week to find ways to bring the U.S. – which took part indirectly – back into the Iran deal that offered sanctions relief for restrictions on Iran’s nuclear program.
Beijing called for progress on sanction relief for Iran and for the United States to return to the 2015 Iran nuclear deal as the deal signatories met in Vienna to seek a breakthrough.
Wang Qun, China’s representative in the discussions on Tuesday, reiterated Beijing’s consistent stance against “illicit sanctions” against Iran, and said the U.S. should immediately revoke its “long-arm jurisdiction” targeting third-party entities and individuals, including from China.
“China will continue to unswervingly safeguard the comprehensive agreement, and hopes that various parties can increase their sense of urgency and seize all opportunities to push the comprehensive agreement back on the right track through fair and reasonable discussions,” Wang said.
China supports the process of “close contact” with the U.S. to push to restore the deal – known as the Joint Comprehensive Plan of Action – as soon as possible, Wang said.
U.S. officials described the talks as “constructive,” but State Department spokesman Ned Price said Washington did not anticipate immediate breakthroughs in “tough talks” to return Iran to full compliance with its nuclear commitments under the deal.
For its part, Iran wants the U.S. to lift all sanctions and rejects any “step-by-step” easing of restrictions, the foreign ministry said ahead of the talks.
Afghanistan: It seems that President Biden is going to let a May 1 deadline for completing a withdrawal of U.S. troops from Afghanistan lapse. Orderly withdrawals take time, and Biden is running out of it.
The indecision means a pullout of the remaining 2,500 troops is put off for another few months.
James Stavridis, a retired Navy admiral who served as NATO’s top commander from 2009 to 2013, says it would be unwise at this point to get out quickly.
“Sometimes not making a decision becomes a decision, which seems the case with the May 1 deadline,” Stavridis said in an email exchange with the Associated Press Wednesday. “The most prudent course of action feels like a six-month extension and an attempt to get the Taliban truly meeting their promises – essentially permitting a legitimate ‘conditions based’ withdrawal in the fall.”
While Biden has long believed Afghanistan is better handled as a smaller-scale counterterrorism mission (and aside from the 2,500 troops, we do have anywhere from 700 to 1,000 intel forces, such as CIA, in the country), leaving the Taliban with a position of relative strength and the Afghan government in a fragile state would risk losing what has been gained in 20 years of fighting. And countering Russia and China has now emerged as a higher priority.
Jordan: The half-brother of Jordan’s King Abdullah said he was placed under house arrest last weekend and accused the country’s leadership of corruption and incompetence.
In a videotaped statement leaked to the BBC, Prince Hamzeh* bin Hussein said he was visited early on Saturday by the country’s military chief and told, “I was not allowed to go out, to communicate with people or to meet with them.”
*Also spelled Hamzah/Hamza.
He said his security detail was removed, and his phone and internet service had been cut.
The BBC said it received the statement from Hamzeh’s lawyer. In it, Hamzeh said he had been informed he was being punished for taking part in meetings in which the king had been criticized, though he was not accused of being a direct critic.
[Prince Hamzeh, 41, was first in line to succeed his half-brother, King Abdullah, as Jordan’s head of state until 2004, when he was removed as crown prince. King Abdullah designated his son as heir instead.]
Hamzeh then pledged allegiance to King Abdullah on Monday, two days after being placed under house arrest. Hamzeh issued a statement hours after mediation saying he was committed to the constitution.
Officials said the king had asked his uncle, Prince Hassan, to help resolve the unprecedented tensions.
The prince denies the allegations of conspiracy.
In a signed letter released by the palace on Monday, Prince Hamzeh said: “I place myself in the hands of his majesty the king…I will remain committed to the constitution of the dear Hashemite Kingdom of Jordan.”
Hamzeh is not seen as a major threat to Jordan’s monarchy and has been marginalized for years, but the move against him represents the first such incident involving a close member of the royal family since King Abdullah came to the throne.
David Ignatius / Washington Post
“Abdullah has been king for 22 years, but the palaces that dot the hills of Amman are haunted, still, by memories of the late King Hussein, his charismatic father. Hussein gave his own memoir the Shakespearean title, ‘Uneasy Lies the Head’ (that wears the crown). In a story about him 40 years ago for the Wall Street Journal, I counted nearly a dozen coup and assassination plots. Conspiracy talk is ceaseless in Amman, but sometimes it’s real.
“Hamzeh seems to threaten Abdullah partly because he looks and sounds so much like their late father. Hamzeh compounded this anxiety over the past year by reaching out to the Bedouin tribes that bolster Jordan’s military and intelligence services – and by maintaining a visible social media presence. That culminated in an abrupt visit Saturday from Maj. Gen. Youssef al-Huneiti, the chief of the Jordanian military, who ordered Hamzeh to keep quiet, which friends say only rankled him more.
“What set the gossip buzzing was the string of prominent people arrested at the same time Hamzeh was visited by the military chief….
“Monarchies present an image of stability, but it often masks deep anxieties. The House of Saud, for example, has always had a brotherly rivalry with the Hashemites in Jordan, because of Riyadh’s fear that Muslims might view the Hashemites, who as descendants of the prophet Muhammad ruled Mecca and Medina for centuries, as the true guardians of the Holy Places.
“Saudi Crown Prince Mohammed bin Salman is perhaps the best example of a reform-minded royal who subverted his dreams for his kingdom by listening to courtiers’ talk of alleged plots against him on social media – by Post contributor Jamal Khashoggi, among others. Uneasy lies the head…
“Whatever conspiratorial talk may be buzzing around Amman now, the biggest potential danger to Abdullah is himself – if he listens to voices telling him to muzzle dissent, crush potential rivals and wreck the foundations of modern Jordan’s stability. Only a very unwise monarch would choose that course.”
Israel: As Prime Minister Benjamin Netanyahu’s corruption trial got underway on Monday, the prosecution saying he had abused his power as part of a wide-ranging bribery scheme, at the same time, a majority of the Knesset who were sworn in the next day are believed to favor a plan to vote for Netanyahu to be Israel’s next president, according to the Jerusalem Post.
By law, the election for president must be held between April 9 and June 9, before President Reuven Rivlin’s seven-year term expires on July 9.
A senior Likud source told the Post, “I know for a fact that most of the MKs would vote for him if he decides he wants to be president. It’s all in Netanyahu’s hands.”
The strategy is that leaving the Prime Minister’s Residence for the President’s Residence three blocks away could help end the two-and-a-half-year political stalemate.
If Netanyahu is no longer leader of the Likud, the party would hold a snap primary among its members and whoever wins could easily form a stable, center-right coalition comprised.
China: The American military is warning that China is probably accelerating its timetable for capturing control of Taiwan, the island democracy that has been the chief source of tension between Washington and Beijing and the most likely cause of a potentially catastrophic war.
China has become more aggressive as its military has benefited from years of spending and innovation. Beijing is also more assertive in sovereignty disputes in the South China Sea.
But a move against Taiwan could force the Biden administration to abandon a friendly democratic entity. The alternative is all-out war over a cause most Americans haven’t given a thought. For decades the United States has pledged to help Taiwan defend itself, but it has deliberately left unclear how far it would go in response to a Chinese attack.
Today, eleven Chinese aircraft entered its air defense identification zone, including eight fighter jets, the island’s defense ministry said.
Separately, Chinese Foreign Minister Wang Yi said China would not accept a list from Washington of unilateral demands for negotiations with Beijing. “The door for dialogue with China is open. But the dialogue should be done on equal basis and with mutual respect,” he said.
“China will not accept that there is any nation in the world that [can] put itself superior to the others, and that any nation will have a final say on world affairs. If the U.S. continues to confront, China will take it calmly without fear.”
Wang was speaking to Chinese state media about a meeting with various foreign ministers from the region.
“We resolutely resist gross interference in China’s internal affairs, and even more resolutely oppose unlawful unilateral sanctions imposed on the basis of lies and false information,” he said.
Wednesday, the Chinese government warned Washington not to boycott next year’s Winter Olympics in Beijing after the Biden administration said it was talking with allies about a joint approach to complaints of human rights abuses. A Foreign Ministry spokesperson rejected the accusations of abuses against the Uighurs in Xinjiang, and warned of an unspecified “robust Chinese response” to a potential boycott.
The Games are around the corner, due to start in February 2022.
In recent months, Olympic leaders have attempted to get ahead of the controversy over the Beijing Games, recalling a time when the U.S. joined multiple countries in refusing to participate in the 1980 Moscow Games because the Soviet Union had invaded Afghanistan. Nine years passed before the Soviets withdrew from that country.
“A boycott from the Olympic Games has never achieved anything,” Thomas Bach, president of the International Olympic Committee, said during a recent news conference.
“Why would you punish the athletes from your own country if you have a dispute with another country?” he said. “This makes no real sense.”’
North Korea: Kim Jong Un acknowledged his country was facing the “worst-ever situation” as he addressed thousands of grassroots members of his ruling party during a political conference in Pyongyang.
Experts say it’s Kim’s toughest moment as he approaches a decade in rule, as the coronavirus lockdown unleashes further shock on an economy devastated by crippling U.S.-led sanctions and decades of mismanagement.
“Improving the people’s living standards…even in the worst-ever situation in which we have to overcome unprecedentedly numerous challenges depends on the role played by the cells, the grassroots organizations of the party,” Kim said.
He urged members of the Workers Party to carry out the decisions made at a January party congress, including the new five-year national development plan. Kim then criticized the party’s grassroots units (which are comprised of five to 30 members) that oversee the works and lives at factories and other places.
The economic setbacks have left Kim with nothing to show for his ambitious diplomacy with former President Donald Trump, which collapsed over disagreements in lifting sanctions for the North’s denuclearization steps.
The North has so far rejected the Biden administration’s overture for talks, saying that Washington must discard its ‘hostile’ policies first, and dialed up pressure by resuming tests of ballistic missiles last month after a yearlong pause.
Russia/Ukraine: Ukraine believes Russian President Vladimir Putin’s government is massing troops and military hardware on the border to try to rally Russians against a foreign enemy and distract from domestic problems, Ukraine’s security chief said on Wednesday,
Oleksiy Danilov, secretary of the national security and defense council, told Reuters that Ukraine will not try to recapture occupied territory in the eastern Donbass region by force but was ready to defend itself against any further assault.
Ukraine, the United States and the NATO military alliance have accused Russia of staging a provocative military build-up near the Ukrainian border, though Moscow has said its forces there are a defensive measure and will remain as long as it sees fit.
Danilov said, “The question of war depends only on Putin. Putin does not feel sorry for people and this is a problem. For us, every loss that is now at the front is pain, for us it is a tragedy.”
Russia is going into election mode ahead of parliamentary polls in September and domestic irritants, such as opposition figure Alexei Navalny, make it easier to focus on an external enemy, Danilov said.
Thursday, German Chancellor Angela Merkel told Vladimir Putin to pull back the Kremlin’s military build-up, while he in turn accused Kiev (Kyiv) of “provocative actions” in the conflict region.
Today, Dmitry Kozak, deputy head of Russia’s presidential administration, warned that Moscow could intervene to help Russian-speaking residents in eastern Ukraine launch an all-out assault on separatists there.
“Everything depends on the scale of the conflagration,” Kozak said.
He also warned that an escalation could mark the “beginning of the end” for Ukraine – “not a shot in the leg, but in the face.”
Nice guy…remind me not to go out for beers with him.
As for Alexei Navalny, in an Instagram post, the 44-year-old opposition leader said that as many as three people from his unit had been taken to hospital with tuberculosis recently. He said he had a persistent cough and a temperature of 100.6 degrees F.
“If I have tuberculosis, then maybe it’ll chase out the pain in my back and numbness in my legs. That’d be nice,” he quipped.
But he added that he would be continuing his hunger strike, started last week to demand proper treatment for acute back and leg pain.
Navalny’s lawyers have been visiting him in custody and helping him to post messages on social media.
--Presidential approval ratings….
Rasmussen: 50% approve of President Biden’s job performance, 48% disapprove (April 9).
--A new Gallup poll released on Wednesday shows more Americans identify as Democrats than Republicans by a margin that hasn’t been seen in a decade.
An average of 49% of adults age 18 and older reported Democratic Party affiliation or said they are independent with Democratic leanings throughout the first quarter of 2021, the pollster reported. The survey was conducted by phone from January-March.
In comparison, 40% of adults identified as Republican or Republican-leaning. The 9% difference is the Democrats’ largest advantage since the fourth quarter of 2012, according to the report.
The remaining 11% of respondents were political independents with no partisan leanings.
Democrats have typically held a 4- to 6-point advantage over Republicans. Shortly before the first quarter of the year, the gap in affiliation was virtually nonexistent before Democrats’ advantage widened by 9%.
The report also noted a 6% increase in independents; from 38% in the fourth quarter of 2020 to 44% in the first quarter of 2021. It’s the highest percentage since 2013, when 46% of survey respondents identified as independents. The rise correlates with the decline in Republican Party identification, just as in 2013, when the GOP saw a drop in popularity during the government shutdown over the Affordable Care Act.
--The New York Times reported Tuesday that Representative Matt Gaetz (R-Fla.), one of President Donald Trump’s most vocal allies during his term, including publicly pledging loyalty and even signing a letter nominating the president for the Nobel Peace Prize, sought something in return in the final weeks of Trump’s term.
“He privately asked the White House for blanket pre-emptive pardons for himself and unidentified congressional allies for any crimes they may have committed, according to two people told of the discussion.
“Around that time, Mr. Gaetz was also publicly calling for broad pardons from Mr. Trump to thwart what he termed the ‘bloodlust’ of their political opponents. But Justice Department investigators had begun questioning Mr. Gaetz’s associates about his conduct, including whether he had a sexual relationship with a 17-year-old that violated sex trafficking laws, in an inquiry that grew out of the case of an indicted associate in Florida.
“It was unclear whether Mr. Gaetz or the White House knew at the time about the inquiry, or who else he sought pardons for. Mr. Gaetz did not tell White House aides that he was under investigation for potential sex trafficking violations when he made the request. But top White House lawyers and officials viewed the request for a pre-emptive pardon as a nonstarter that would set a bad precedent, the people said.
“Aides told Mr. Trump of the request, though it is unclear whether Mr. Gaetz discussed the matter directly with the president.” [Michael S. Schmidt, Maggie Haberman and Nicholas Fandos]
Gaetz said he’s “absolutely not resigning” as he blamed his sexual misconduct scandal on his “political opponents” in an op-ed for the Washington Examiner.
“Yes, just like the mafia, the D.C. swamp protects its [sic] ‘made men.’ Since I’m taking my turn under the gun, let me address the allegations against me directly. First, I have never, ever paid for sex. And second, I, as an adult man, have not slept with a 17-year-old.”
Calling himself a “better man today that I was years ago,” the Republican lawmaker went on to say that while “my lifestyle of yesteryear may be different from how I live now…it was not and is not illegal.”
“And no, I am absolutely not resigning,” he vowed in the piece, adding that he won’t be “intimidated or extorted” into doing so.
“The battle for America’s future demands gladiators, and I am going to keep getting back up and fighting, every single day,” Gaetz wrote.
Former President Trump said Wednesday that Gaetz “has never asked me for a pardon” and stressed that Gaetz “has totally denied the accusations against him.”
But the Times’ story did not say that Gaetz directly asked Trump himself for a pardon, reporting it was “unclear” whether Gaetz actually spoke with the then-president about the request.
So then Thursday we learned that Joel Greenberg, an associate of Gaetz’, is negotiating a plea deal with prosecutors.
Greenberg, the former Seminole County tax collector, resigned last June after being indicted on multiple charges. The indictment was expanded to 33 federal charges last week that include sex trafficking, bribery, fraud and using his position to create fake IDs. According to multiple media reports, the investigation into Greenberg led investigators to open a separate investigation involving Gaetz and whether he had a sexual relationship with a 17-year-old girl and paid for her travel and if he paid for sex with other women.
Gaetz and Greenberg were friends and supporters of each other politically.
Speaking to members of the media after Thursday’s hearing in federal court in Orlando, Greenberg’s attorney, Fritz Scheller, was asked if Gaetz should be concerned about what happened in court.
“I’m sure Matt Gaetz is not feeling very comfortable today,” Scheller said.
Today, the House Ethics Committee said it has begun an investigation into the allegations involving Gaetz.
Republican Representative Adam Kinzinger (Ill.) was the first to offer in a tweet:
“Matt Gaetz needs to resign.”
--Former House Speaker John Boehner says in his forthcoming book that President Donald Trump “incited that bloody insurrection” at the U.S. Capitol and blamed his false election claims for the GOP losing control of Congress.
Boehner’s scathing rebuke amounts to the latest plea by the former de facto head of the GOP to resist Trump’s influence as it defines itself in the Biden era.
Trump’s “refusal to accept the result of the election not only cost Republicans the Senate but led to mob violence,” the former speaker writes in his book, “On the House: A Washington Memoir,” adding, “it was painful to watch.”
Boehner said the former president “incited that bloody insurrection for nothing more than selfish reasons, perpetuated by the bullshit he’d been shoveling since he lost a fair election the previous November.”
“He claimed voter fraud without any evidence, and repeated those claims, taking advantage of the trust placed in him by his supporters and ultimately betraying that trust,” Boehner said.
The New York Times reported that Trump asked in an email to the paper about Boehner, “Was he drinking when he made this statement? Just another RINO who couldn’t do the job!”
Boehner also wrote he wasn’t prepared for Trump “refusing to accept the results and stoking the flames of conspiracy that turned into violence in the seat of our democracy” in the building he once presided over. “Watching it was scary, and sad. It should have been a wake-up call for a return to Republican sanity.”
--Donald Trump is rebranding himself. He is not focused on using his surname, but rather he’s replacing it with a number: 45.
Last week, the 45th president launched his new official website, 45Office.com.
His PAC can be accessed at SaveAmerica45.com. His old White House tweets can be found @WhiteHouse45. [Not his personal ones.]
--Edward Luce / Financial Times
“One-term U.S. presidents almost never get another bite at the apple. That is because they acknowledge their defeat at the ballot box. Donald Trump, on the other hand, has been telling supporters that he will be tempted to beat Democrats ‘for a third time.’
“Most Republican voters still think last year’s election was stolen. It is difficult to imagine Trump would face a serious conservative rival, should he run again in 2024. To some extent he should thank Joe Biden for that. Having championed popular spending bills in his first two months, Biden has deprived Republicans of a populist economic critique.
“Trump showed in 2016 that embracing big government was no obstacle to becoming his party’s nominee. The libertarian impulse is barely perceptible among today’s Republican voters, many of whom are happy with Bidenomics. The party’s energy is thus increasingly spent on cultural resentment. More than half of Republican voters support the use of force to defend the ‘traditional American way of life.’
“Elected Republicans now often refer to themselves as ‘the party of the working class.’ In western democratic terms, Republican ideology has more in common with Marine Le Pen’s* Rassemblement National in France than, say, with the British Conservative party, let alone the German Christian Democrats. The party is moving closer towards white nationalism.
*Ed. Le Pen’s popularity is rising these days against French President Emmanuel Macron.
“What does that mean for the future of U.S. democracy? The first quarter of 2021 provided a tale of two wildly different national moods. During the first three weeks, non-Trumpian Americans were gripped by fears that Trump could somehow overturn Biden’s electoral college victory before he was sworn in. The violent storming of Capitol Hill on January 6 lent credence to those anxieties.
“Then night turned to day as Biden capitalized on the vaccine rollout and enthusiasm for his legislative agenda. It is all too easy to forget Trump’s nightmarish closing days and proclaim America’s return to democratic health. But that would be premature. One of two main parties now openly rejects the rules of the game and is making a concerted attempt to ensure any replay of the 2020 election would produce the opposition result.
“Republicans across the U.S. are moving in lockstep to enact stringent curbs on voting. Georgia, which has just passed a bill that makes it an offense to provide food or water to voters standing in queues (a burden that Georgia’s Republicans ensure falls disproportionately on black-majority precincts), has led the way. Similar measures are poised to be enacted in other Republican-controlled states. Meanwhile, Republicans in Washington are unanimously opposed to a Democratic bill – the ‘For the People Act’ – that would make voting easier across the nation.
“None of which means the party lacks an economic agenda. Republicans continue to oppose any kind of business regulation and almost all taxes. But the public mood, which has tilted towards collective action during the pandemic, has forced them to muffle these priorities. In a memo leaked to Axios last week, two leading Republicans argued that the party should pursue a pro-business, anti-globalist agenda.
“The party will sound as if it reviles Wall Street even as it blocks attempts to raise the capital gains tax. It will be anti-corporate in word, but pro-billionaire in deed; blue-collar on the airwaves, but protective of offshore tax shelters in practice; the party of law and order that insists the 2020 election was stolen.
“The gap between the Republican party’s working-class rhetoric and its plutocratic fiscal agenda will continue to widen. The bridge between them is culture, which is being made to bear an increasingly heavy load. Old-style panics about issues like marriage equality bring diminishing returns. There may be some gain in opposing vaccine passports and complaining about shuttered schools. Teachers’ unions often provide a deserving target. Yet these are trivial compared with the existential dread of a multiracial America.
“Republicans have two big pluses going for them. The first is anti-incumbency. If history is a guide, Democrats will probably lose control of both the House of Representatives and the Senate in next year’s midterm elections. That would halt Biden’s domestic agenda, which would make it easier to defeat him two years later. The average loss for a first-term president’s party is one Senate and 23 House seats. Biden can only afford to lose five in the House and none in the Senate.
“Their second plus is what the Republican memo describes as the left’s ‘cultural elitism.’ Much of this is hype that has little to do with most people’s lives. Biden has been careful not to encourage the more woke elements of his party. Moreover, it is hard to paint him as unpatriotic. Biden may be the Democratic party’s closest thing to Ronald Reagan, a genial old-timer with a spirit of optimism.
“But the immigration crisis on the U.S.-Mexico border is only likely to worsen. Biden has given Kamala Harris, his vice-president, the unenviable job of finding a solution. Likewise, the cultural left is unlikely to be quiescent for long. Were Biden to stand down in 2024, Republicans would find it easier to depict Harris, or almost any other candidate, as the ‘anti-American’ Democrat they crave. Trump looks likely to hang around for just such an opening.”
On Easter Sunday, Trump released a statement in which he tried to resurrect the election fraud conspiracy theory that led to the Jan. 6 assault on the U.S. Capitol.
“Happy Easter to ALL, including the Radical Left CRAZIES who rigged our Presidential Election, and want to destroy our Country!”
--Michael Goodwin / New York Post…on the “ultimate destruction of the New York we know.”
“Washington is sending train loads of money to blue states to bail out their high tax, high spend habits. As longtime government guru Dick Ravitch writes in a Wall Street Journal op-ed, ‘Congress has been generous, allocating more than $12 billion to New York state, $6 billion to the city, $6 billion to the Metropolitan Transportation Authority, and $9 billion to the state’s schools.’
“The state’s take raises the total budget about to be adopted to $212 billion, some $18 billion higher than the fiscal year that just ended. Florida, which has two million more people, will make do with spending $97 billion this year.
“Ah, but in Albany, it’s never enough. Not as long as the Legislature is in session.
“Despite the bailout, and the December pandemic stimulus, and the ones before that, Gov. Cuomo and lawmakers are launching $4 billion of new tax hikes. Apparently being the highest taxed state by most measurements doesn’t satisfy them. They want to be No. 1 across the board.
“Naturally, they say only corporations and the really rich will be hit, but don’t believe them. Tax hikes trickle down in that they tend to reduce the economic activity of those who pay them, a decline that eventually hits everyone. Having the government redistribute more taxpayer money is, at this historic juncture, a terrible idea.
“Tax hikes will kill more businesses and cause others to look for more hospitable turf. Wags already have dubbed Gov. Cuomo and Mayor de Blasio the ‘employees of the month – in Florida.’
“Besides, even if it were true that only the rich would get hit, raising taxes sends the wrong message in a state where so many people and businesses already have left or are thinking about it.
“What business would want to come here now? Why should existing ones continue to pay more and more for dangerous and dirty streets and arbitrary pandemic shut downs?
“The answer for many is no, no, hell no, and they have given up on New York. The proof is in the sagging real estate market [Ed. as I note above, not necessarily true!] and the empty storefronts in even the best locations.
“Not all of those leaving are rich, but they’re all afraid, and not just of the inevitable cost of living increases that follow as the taxes ripple through housing, services, transportation and every bottle of beer and bag of potato chips sold.
“Many are also understandably afraid of crime and public disorder. A snapshot of NYPD stats over two years paints an unmistakable picture of a city in serious decline.
“Murder climbed nearly 45 percent last year and is up an additional 13.5 percent this year. The increase translates into an additional 153 New Yorkers shot, stabbed and strangled.
“Shooting victims are up 72 percent in two years, and car thefts are up a staggering 91 percent. The city is in a death spiral, with unprovoked attacks and subway pushings adding more reason for rational fear.”
Yes, this year’s mayoral election for New York City is critical, but the state’s taxes, and funding priorities, offer no help to whoever is elected.
That said, New York has been through crises before and always emerged better on the other side.
--Editorial / Wall Street Journal
“As New York’s Covid expatriates consider returning to the office, lawmakers in Albany should be shouting welcome home. Instead they’re eyeing big new tax increases that would give the state’s temporary refugees to Florida – or wherever – one more reason to stay away for good. On Sunday a budget deal appeared close, but not cinched by our deadline. Here are some of the proposals the state Assembly set out:
“Income taxes: Impose graduated rates on millionaires, up to 11.85%. This is much higher than today’s top marginal levy of 8.82% on joint filers earning $2.2 million. Under the Assembly’s plan, that existing bracket would be taxed at 9.85%. Earnings above $5 million would be hit with 10.85%. The new top marginal rate, 11.85%, would kick in at $25 million.
“Since New York City has its own income tax, running to 3.88%, the combined rate would be 15.73%. That’s a bigger bite than even California’s notorious 13.3% top tax, and don’t forget Uncle Sam’s 37% share. Pretty soon living in a low-tax state looks inviting. Keep in mind that New York’s income tax is already progressive: The top 5% of filers contribute more than 60% of the revenue, the Journal reports.
“Capital-gains taxes: Put a 1% surtax on investment gains by people earning $1 million a year. That percentage might sound small, but New York already taxes capital gains as regular income. So start with the Assembly’s new top marginal rate of 15.73% for a Manhattanite. Add the 1% surtax. The top federal rate on cap gains is 23.8%. The grand total would be 40.53%, and that’s before Joe Biden’s campaign promise to tax capital gains federally as regular income. What a thanks for investing to create jobs in the city.
“Estate taxes: Raise the top rate to 20%, from today’s 16%, for taxable estates above $10.1 million. Remember, again, this is stacked atop the federal estate tax of 40%, meaning the government’s marginal take would reach 60%. Is it any wonder that wealthy people spend big bucks hiring estate lawyers? ….
“Such proposals would harm New York. Consider a letter signed last month by 250 business leaders. ‘As committed New Yorkers and employers of more than 1.5 million residents,’ they expressed ‘alarm at plans to enact the largest spending and tax increases in the state’s history.’
“The letter’s signatories include leaders from Bank of America, Pfizer, ViacomCBS, JPMorgan Chase, Nasdaq, Bloomberg, JetBlue, WeWork, Mastercard, Goldman Sachs and Revlon. They say the pandemic revealed that their workforces are ‘more mobile than we ever imagined.’
“Right now ‘only about 10% of our colleagues are in the office,’ and ‘the proposed tax increases will make it harder to get them to return.’ Instead, companies might feel pulled toward places their staffs want to live: ‘This is what happened to New York during the 1970s, when we lost half our Fortune 500 companies, and it took thirty years to recover.’”
--Fay Vincent / Wall Street Journal…Vincent the former commissioner of baseball…
“Major League Baseball decided last week to move the All-Star Game out of Atlanta after the Georgia Legislature passed changes to the state’s voting laws that many, including President Biden, called racist. Activists urged Commissioner Robert Manfred to punish Georgia. By rushing to do so without first protesting the substance of the law, Mr. Manfred made a serious mistake.
“The use of ‘muscle’ or financial power to influence policy is an ancient tactic. The term ‘boycott’ has its roots in 19th-century Ireland, where the nationalist politician Charles Stewart Parnell urged his followers not to deal with Charles Cunningham, a highly unpopular British land agent. A boycott is generally an act of desperation, and the original one was largely unsuccessful.
“Organizations like Major League Baseball have sometimes participated in public debates over policy. Moving directly to an economic sanction suggests that Mr. Manfred believed the Georgia law required drastic intervention. But consider what he didn’t do: He didn’t limit the number of home games the Atlanta Braves will play. He’d need the approval of the players’ union to do that, and Braves owner John Malone would surely resist. To move the site of the All-Star Game is one thing; to ignore union and ownership powers is quite another.
“The midsummer All-Star Game is an exhibition that benefits only the city where it’s played. It was reported Tuesday morning that Denver will be the new host. The players will get paid no matter where the game takes place. MLB will get the same television revenue. The only people hurt by Mr. Manfred’s decision will be Atlanta’s stadium workers and local vendors.
“The talk shows and editorial pages are full of questions. What is the basis for acting so forcefully against Georgia? If Georgia is racist, how can baseball talk of doing business with China? Mr. Manfred failed to spell out specific criticisms of Georgia’s voting laws. Now he’s put himself in the awkward position of having to defend Colorado’s voting laws.
“During my time as commissioner, I learned that the American people view baseball as a public trust. They want the game to stand for the best and noblest of our national virtues. They see baseball as the repository of their dreams, even as they root for their favorite teams. They don’t want, and won’t accept, anything that separates them from the game’s history and leadership.
“Major League Baseball can’t become a weapon in the culture wars, a hostage for one political party or ideology. It can’t be only for the rich or the poor, nor can it only be for one race, as it was until 1947. Baseball must always stand above politics and its dark elements of corruption, greed and sordid selfishness. It can’t go wrong by standing for national greatness.
“The situation calls to mind the 2006 Duke lacrosse case, when many erred – like Mr. Manfred has here – by leaping to a conclusion based on assumptions rather than carefully considered facts. I’ve done the same thing, to my regret. Much rides on Mr. Manfred’s shoulders so he must be prudent. Perhaps he now sees how complicated these issues can become. I wish him well.”
Former President Trump called for boycotts of opposing corporations to Georgia’s election laws, including MLB, Delta, and Coke. “Don’t go back to their products until they relent,” Trump said.
But in a photo of his new office digs, it seemed a bottle of Diet Coke was on his desk, behind the phone.
--Fox News announced that former Secretary of State Mike Pompeo has been hired to be a paid contributor, which will serve him well if he decides to run for the U.S. Senate in his home state of Kansas, as has previously been speculated. So he has an outlet that many prospective voters in Kansas will be tuning in to. Should Pompeo run for office, then he has to give up the gig.
--In the Derek Chauvin trial, after Minneapolis police Lt. Richard Zimmerman had told the jury last week, “If your knee is on a person’s neck, that can kill them,” describing the tactic as a “top-tier, deadly” use of force, the prosecution called several Minneapolis police officers to the stand in its attempt to rebut defense claims that Chauvin was following training and policy when he knelt on George Floyd’s neck for over nine minutes.
[Zimmerman, the longest-serving officer in the Minneapolis department who joined the force in 1985, said he’s never been trained to kneel on a suspect’s neck while the person is handcuffed and in a prone position.]
Several veteran officers, including the city’s policy chief, have testified that Chauvin violated department policies when he used his knee to pin Floyd, face down and handcuffed, as Floyd cried out that he couldn’t breathe.
Prosecutors then showed the jury images of department records showing that Chauvin had taken courses that should have led him to respond differently at the scene with Floyd.
Minneapolis Police Chief Medaria Arradondo said Monday that Chauvin violated department policy and training during his fatal encounter with Floyd.
“Clearly, when Mr. Floyd was no longer responsive, and even motionless, to continue to apply that level of force to a person, prone, handcuffed behind their back, that in no way, shape or form is anything that is by policy, is not part of our training, and it is certainly not part of our ethics,” the chief testified.
“Once Mr. Floyd had stopped resisting and certainly once he was in distress and verbalized that, that should’ve stopped.”
However, Arradondo conceded under cross-examination that department policies do allow cops to make decisions based on the situation and that “restraint” is an allowed de-escalation tool.
The chief, who fired Chauvin and three other cops following the May 25 incident, has referred to Floyd’s death as “murder.”
Thursday, a critical care doctor called as a prosecution witness, Dr. Martin Tobin, testified that George Floyd died from a lack of oxygen caused by being handcuffed face down in the street with Chauvin’s knee on his neck.
“Mr. Floyd died from a low level of oxygen,” Tobin told the jury, confirming the county medical examiner’s finding that Floyd’s death was a homicide at the hands of police.
Tobin was masterful, such as in his description of how Chauvin and another officer, Alex Kueng, manipulated the handcuffs in such a way as to limit Floyd’s breathing.
“They’re pushing the handcuffs into his back and pushing them high, then other side you have the street. The street is playing the crucial part,” Tobin said. “It’s like the left side is in a vice.”
Tobin said Floyd’s leg can be seen jumping up in an involuntary seizure as his brain is starved of oxygen. Soon after, Tobin said, the moment came when Floyd did not have even “an ounce of oxygen left in his entire body,” after which Chauvin’s knee remained on Floyd’s neck for more than three minutes.
Today, Hennepin County Medical Examiner Andrew Baker testified that he thinks the stress of Floyd’s arrest overwhelmed his already-overburdened heart and “tipped him over the edge.”
“The law enforcement subdual restraint and the neck compression was just more than Mr. Floyd could take by virtue of those heart conditions,” Baker said.
The M.E. did not point to asphyxia, however, in a contrast to other medical experts who spoke this week. Baker said that in his opinion, Chauvin’s knee would not “anatomically cut off Mr. Floyd’s airway.”
But while defense attorney Eric Nelson scored some points, upon re-direct questioning by state’s attorney Jerry Blackwell, Baker emphasized that the top-line direct cause of death remained unchanged today – it’s still “cardiopulmonary arrest” as a result of Floyd being subdued, restrained and his neck compressed by law enforcement. Baker noted that details like Floyd’s drug intake or underlying heart issues are “contributing causes.”
“It was my top line then. It would stay my top line now,” Baker said of the law enforcement restraint. “I would still classify it as a homicide today.”
But Baker’s testimony left the door open a crack for the defense, which will lay out its case next week, after the prosecution wraps up.
--According to a report by Douglas Belkin of the Wall Street Journal, a surge in applications has translated into record low acceptance rates this year at some of the nation’s elite colleges, including the Ivy League.
Yale University accepted 4.6% of the 46,905 people who applied; the applicant pool growing by 33% over last year, when the school accepted 6.6% of applicants.
Harvard University accepted 1,968 candidates, or 3.4% of the 57,435 people who applied. The previous lowest acceptance rate was 4.6% two years ago. Applicants surged 43% over last year.
A Duke admissions official said, “Ten percent of the class entering this fall were admitted a year ago, and decided to take a gap year.” At the school there was a 25% increase in applications that drove the acceptance rate to a record low 5.8% from 8.1% last year.
--According to scientists from the National Oceanic and Atmospheric Administration, the Covid-19 pandemic did nothing to slow the root cause of global warming. In fact, the level of carbon dioxide in the Earth’s atmosphere is now higher than it’s been in at least 3.6 million years.
At that time, sea levels were as much as 78 feet higher, and the average temperature was 7 degrees Fahrenheit higher than in pre-industrial times. Greenland was mostly green.
Overall, levels of carbon dioxide and methane – the two most important greenhouse gases – continued their unrelenting rise.
“Human activity is driving climate change,” said Colm Sweeney of NOAA’s Global Monitoring Laboratory, in a statement released Wednesday. “If we want to mitigate the worst impacts, it’s going to take a deliberate focus on reducing fossil fuels emissions to near zero – and even then we’ll need to look for ways to further remove greenhouse gases from the atmosphere.”
NOAA’s analysis also showed the annual increase in atmospheric methane – a far more potent greenhouse gas than carbon dioxide when it comes to global warming – for 2020 was 14.7 parts per billion, which is the largest annual increase recorded since measurements began in 1983.
--An under-development hypersonic missile failed to launch from the wing of a B-52 bomber during a highly anticipated flight test Monday.
The U.S. Air Force called the failure of the AGM-183A Air-launched Rapid Response Weapon “a setback in demonstrating its progress in hypersonic weapons.” The U.S. military has been racing against China and Russia to field numerous types of hypersonic weapons, which can fly at more than five times the speed of sound.
The Air Force wants to have operational ARRW missiles “in the early 2020s,” according to a statement.
--In May, the Korean War Veterans Memorial on the National Mall will unveil a new focal point – a remembrance wall featuring the names of approximately 36,574 Americans who died supporting the war and more than 7,200 Koreans who died while augmenting the Army. Their names will be organized by rank and respective branch of service, demonstrating how the war’s burden fell unevenly across the military.
But as Army Times reports, getting the money wasn’t a big issue; the non-profit Korean War Veterans Memorial Foundation having successfully done so through private donations, including from South Korean citizens and corporations. The problem is getting the names right!
Those who run the Korea War Project, an online archive and database, estimate there are some 2,000 name discrepancies in the Defense Casualty Analysis System database. Some names shouldn’t be there. Some should be there but aren’t. Others are grievously misspelled or misformatted.
Of particular issue, they explained, are Native American, Asian-American, Hawaiian, and Latino names.
You see the problem. Soon the names are going to be cut in stone.
One glaring example, Army Times points out, is that of a Navy officer who died in…2013.
“Killed in action…remains recovered.”
That’s what the public version of the DCAS database has to say about Navy Lt. j.g. Edwin Nixon Jr., a carrier-based fighter pilot shot down during the Korean War. Nixon’s F9F Panther fighter went down in flames in March 1953, crash-landing in North Korea.
But Nixon survived the crash and became a prisoner of war. He later returned to his family in Seattle, self-publishing a memoir, Killed in Action: Dead…Wrong!, about his experience.
You also have situations like with Lawrence Frederick Emigholz Jr., who died in a 1952 accident while trying to land his fighter on the USS Wasp in the Mediterranean Sea.
The DCAS database has him dying in an accident aboard a ship that had no planes, but, more importantly, misspells his name, egregiously… “Lawerence Freder Emigholz Jr.”
But for each name with a mistake, there are others not included that should be.
It’s a shame. It’s also not fair.
--Finally, we note the passing of Prince Philip, 99, married an astounding 73 years to Queen Elizabeth.
Prime Minister Boris Johnson said: “We remember the Duke…above all for his steadfast support for Her Majesty the Queen, not just as her consort, by her side, every day of her reign, but as her husband, her strength and stay of more than 70 years. And it is to Her Majesty, and her family, that our nation’s thoughts must turn today.”
“Like the expert carriage driver that he was he helped to steer the royal family and the monarchy so that it remains an institution indisputably vital to the balance and happiness of our national life.”
He’s had such a long life, it’s important to remember that Prince Philip was an authentic hero in the Second World War, serving with distinction in the Royal Navy. It was his sense of duty, to Country and to his Queen, that he will forever be remembered for.
Pray for the men and women of our armed forces…and all the fallen.
Thank you to our healthcare workers and first responders.
God bless America.
Returns for the week 4/5-4/9
Dow Jones +2.0% 
S&P 500 +2.7% 
S&P MidCap +0.9%
Russell 2000 -0.5%
Nasdaq +3.1% 
Returns for the period 1/1/21-4/9/21
Dow Jones +10.4%
S&P 500 +9.9%
S&P MidCap +15.8%
Russell 2000 +13.6%
Bears 17.5…not updated this week
Hang in there. Mask up where appropriate. Wash your hands.