Week in Review

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Week in Review

03/02/2013

For the week 2/25-3/1

[Posted 12:00 AM ET]

Washington...the sequester

The meeting at the White House on Friday between President Obama, House Speaker John Boehner, Majority Leader Harry Reid, Mitch McConnell and Nancy Pelosi was as stupid as this entire process has been; the March 1 deadline to enforce $85 billion in budget cuts through Sept. 30, most of which fall on the Pentagon. While the news cycle the next few weeks will be dominated by stories of how sequestration is impacting average Americans, the story now is also about the March 27 deadline for the continuing resolution, “CR,” that funds the government through the end of the fiscal year, Sept. 30.

There is zero agreement in sight for that and a partial shutdown of some government services, different from the sequester cuts, is a distinct possibility. I mean consider that Congress did not enact one of the 12 annual appropriations bills for the budget year that began last October 1.

A Pew Center / Washington Post poll had the public seeing the sequester as having a mostly negative impact rather than a positive one by a 62-18 margin. [Separately, 45% would blame Republicans for the sequester, 32% would hold Obama responsible.]

A Washington Post / ABC News survey had 67% disapproving of the “way Republicans in Congress are handling federal spending.” 52% disapprove of Obama’s handling of it.

An NBC / Wall Street Journal poll had some of the following:

Only 1/5th think the sequester cuts are a good idea, but 4 in 10 prefer a plan with deeper cuts.

President Obama’s overall job approval number is just 50%.

Yet 2 to 1 respondents say Obama is doing more than the GOP to unify the country in a positive way.

Only 29% agree with what Republicans are proposing to do in Congress. 45% agree with Obama’s proposals.

A slight plurality now favors the Democrats on tax policy.

It got so bad this week that Speaker Boehner strode before the microphones to proclaim, “We have moved a bill in the House twice; we should not have to move a third bill before the Senate gets off their ass and begins to do something.”

House Majority Leader Eric Cantor said: “After four years of increased spending, the president now wants a second tax hike in eight weeks – that’s not compromise.”

Obama told an audience at a shipyard in Newport News, Va.: “There are too many Republicans in Congress right now who refuse to compromise even an inch when it comes to closing tax loopholes and special-interest tax breaks.”

But while little is actually going to take place right away, despite the White House’s scare tactics, Republicans have lost the argument, badly, when it comes to tax loopholes such as the carried interest exemption for the private equity and hedge fund communities. Ditto loopholes like the reinsurance one that many of the same folks are taking advantage of in Bermuda and elsewhere. Republicans have been deaf, dumb and blind when it comes to these. President Obama is killing the elephants on this single topic. The loopholes should have been given up, without preconditions, and then Republicans could have drawn the line in the sand, demanding spending and entitlement reform as part of a package to reform the tax code, both for individuals and corporations. I guarantee their poll numbers would have been far higher.

As it is, in future negotiations they’re going to be giving them up anyway! And at a steep price politically. Republicans would have snuffed out Obama’s campaign pitch that Republicans are just out to take care of the fat cats.   Republicans would have also had the moral high ground in then saying, “OK, Mr. President. Now what are you going to do?”

“If you’re reading this after midnight on Friday, March 1, the dreaded Beltway hour of doom known as the ‘sequester’ has arrived and the news is that the world has not ended. You can pinch yourself to make sure. This does not mean there won’t be more political histrionics, but the beginning of applying reason to Washington is understanding that it is possible to cut at least some federal spending.

“President Obama’s goal, by contrast, is not to cut any spending in the here and now, only sometime in the ‘out years,’ to use the Washington phrase, presumably when he’ll be out of office. That’s the only way to comprehend the White House statement Thursday that the President will veto any Republican bill to give him more flexibility to minimize any sequester damage.

“We think the President already has more than enough authority to avoid harm to air traffic control, national parks and the like...We wish Republicans like Paul Ryan would say so. But in any case House Republicans are offering to give Mr. Obama even more flexibility, yet the President won’t take yes for an answer.

“Mull that one over: The President wants to deny himself and his executive branch the authority to do less harm. Don’t stop me before I kill again.

“The White House political calculus seems to be that if Americans see that cutting 2.3% of federal spending is possible without catastrophe, they might learn something from the experience. They might even conclude that government doesn’t need to be as large as it is, or that government should do some things well but not many others poorly. They might even learn that governing is about choosing, as opposed to merely allowing the government to grow willy-nilly year after year to gather more clients who depend on government....

“Perhaps the real political question is how long this catastrophic charade can continue before it’s laughed out of town. Some of the Beltway’s older hands seem to be losing patience, including journalist Bob Woodward, who is being excommunicated from the Revelation Church of Obama by the more devoted media worshippers.

“Mr. Woodward’s sin was to report that the sequester was Mr. Obama’s idea in 2011 and that the terms did not then include a tax increase....But the bigger news is that someone in the establishment press is finally pointing out the Obama habit of dissembling about what he once committed to. This is why John Boehner and senior Republicans don’t believe a single word Mr. Obama says....

“(Some) adult Democrats may want to whisper to the President that if he keeps up this Obamageddon act for too long, the voters may figure out how they’re being conned.”

“The White House is, as always, confident of its strategy: Scare people as much as possible and let the media take care of the rest. Maybe there will be a lot to report, maybe not, but either way the sobbing child wanting to go to Head Start and the anxious FAA bureaucrat worried about airplane maintenance will be found. This will surely have power.

“And in truth, the sequester’s impact may be bad. Rep. Maxine Waters of California, a 22-year House veteran and ranking Democrat on the Financial Services Committee, this week warned of ‘over 170 million jobs that could be lost.’ That’s actually more jobs than America has, and it’s little comfort to say, ‘but she’s a famous idiot,’ because Washington is actually full of famous idiots who are making serious decisions about how the sequester cuts are to be applied.”

“ ‘The worst-case scenario for us,’ a leading anti-budget-cuts lobbyist told The Post, ‘is the sequester hits and nothing bad really happens.’

“Think about that. Worst case...that a government drowning in debt should cut back by 2.2 percent – and the country survives. That a government now borrowing 35 cents of every dollar it spends reduces that borrowing by two cents ‘and nothing bad really happens.’ Oh, the humanity!....

“A 2011 Government Accountability Office report gave a sampling of the vastness of what could be cut, consolidated and rationalized in Washington: 44 overlapping job training programs, 18 for nutrition assistance, 82 (!) on teacher quality, 56 dealing with financial literacy, more than 20 for homelessness, etc. Total annual cost: $100 billion-$200 billion, about two to five times the entire domestic sequester.

“At the fiscal cliff, Obama broke – and split – the Republicans on taxes. With the sequester, he intends to break them on spending. Make the cuts as painful as possible, and watch the Republicans come crawling for a ‘balanced’ (i.e., tax-hiking) deal....

“But he cannot win if ‘nothing bad really happens.’ Indeed, he’d look both foolish and cynical for having cried wolf.”

“Even during this desultory economic recovery, one industry thrives – the manufacture of synthetic hysteria. It is, however, inaccurate to accuse the Hysteric in Chief of crying ‘Wolf!’ about spending cuts under the sequester. He is actually crying ‘Hamster!’

“As in: batten down the hatches – the sequester will cut $85 billion from this year’s $3.6 trillion budget! Or: Head for the storm cellar – spending will be cut 2.3 percent! Or: Washington chain-saw massacre – we must scrape by on 97.7 percent of current spending! Or: Chaos is coming because the sequester will cut a sum $25 billion larger than was just shoveled out the door (supposedly, but not actually) for victims of Hurricane Sandy! Or: Heaven forfend, the sequester will cut 47 percent as much as was spent on the AIG bailout! Or: Famine, pestilence and locusts will come when the sequester causes federal spending over 10 years to plummet from $46 trillion all the way down to $44.8 trillion! Or: Grass will grow in the streets of America’s cities if the domestic agencies whose budgets have increased 17 percent under President Obama must endure a 5 percent cut!”

Regarding all the above and the general debate of the day both on Wall Street and Washington, I’m continually amazed how there is zero talk of risk on the geopolitical front.

“Hillary Clinton left the state department last month under a shower of plaudits. I cannot quite understand why. Certainly she was tireless in touring the globe to rebuild the bridges burnt during George W. Bush’s first term.  Her focus on raising the status of women was smart as well as admirable....But by and large, she concentrated on diplomacy’s cuddlier dimensions. The bold stuff – the blending of strategic insight and courage with persuasion and coercion to change the basic contours of international relations – was left to one side....

“Policy experts leaving the Obama administration carry with them an air of disillusionment. Two themes emerge from their accounts of life in the bubble. The president’s analysis is often right. What’s missing is a resolve to follow it through. Leaders have to be willing to fail. Excess caution can be as much an enemy of good policy as is recklessness....

“My Washington friends say we should not expect much to change. Mr. Obama has challenges enough at home. The watchword of the staff who guard him in the White House is the avoidance of risk. Yet that will not guarantee an absence of war. Washington cannot by itself simply ‘fix’ things; and some things may never be fixable. What we can say for sure is that without the U.S. most things will remain unfixed.”

As for the U.S. economy there was some positive data, such as in the S&P/Case-Shiller home price figure for December, up 6.8% year-over-year for the 20-city index; January new home sales came in much better than expected, the best annualized pace since July 2008; January durable goods, ex-transportation, were far better than expected; the February Chicago purchasing managers index, 56.8, as well as the ISM manufacturing index for the month, 54.2, were both substantially better than expected.

But there were some so-so data points, such as the revision to fourth-quarter GDP, which went from minus 0.1% to plus 0.1%, though this was far less than the 0.5% revision that was expected. January personal income came in far worse, minus 3.6%, due in part to all the income, such as in bonuses and dividends, that was pulled forward into December amidst the uncertainty of the fiscal-cliff debate and the potential for rising tax rates. January construction spending was also down 2.1% when a gain was expected.

As for the Federal Reserve, chairman Ben Bernanke appeared before Congress for his semi-annual testimony on the state of the economy and Fed policy and he reassured one and all that easy money was here to stay, both in terms of the bond-buying program as well as zero interest rates, and that no one should be concerned over hints of Fed dissent. To wit:

“We’re quite comfortable that we can exit in a way that is both smooth and in which we provide lots of information to markets in advance, so they will know what’s coming and be able to anticipate,” Bernanke said in his House testimony. 

The chairman also reiterated the Fed would keep short-term rates near zero at least until the unemployment rate drops to 6.5%, as long as inflation remains in check. He also offered a “reasonable guess” that the unemployment rate would not fall to 6% until about 2016. We currently sit at 7.9%, with the February report coming up next Friday.

And just an aside on some of Bernanke’s testimony. He warned the sequester would put a “significant” burden on the economy, but then when asked the impact if the president had the flexibility to target the cuts, Bernanke said it would be the same, which is totally nonsensical.

Bernanke also played the role of village idiot when asked about the impact of the Italian election on the eurozone as he unbelievably said all four parties favored staying in it. 

So let’s go to Italy and find out just what a fool Bernanke was in making this comment, shall we?

Italy and Europe

Pier Luigi Bersani, the center-left candidate, was supposed to roll in the Italian election and then partner with caretaker Prime Minister Mario Monti to keep Italy’s reform effort in place and, instead, a funny thing happened on the way to the Forum. Or not so funny, as proved to be the case.

In a nutshell, you need to control both the lower house of parliament and the upper house (the Senate) in order to get things done legislatively in Italy and the leading vote-getter in the lower house elections gets a bonus that then guarantees 55% for their efforts, while the Senate doles out bonus seats on a strictly regional basis.

So, you had a situation where Bersani gained just 29.5% of the lower house vote to Silvio Berlusconi’s 29.2%, while comedian Beppe Grillo’s anti-establishment, Five-Star party took a shocking 25.5%. Mario Monti and his centrist coalition brought up the rear at a highly disappointing 10.6% reflecting voter weariness with austerity.

[Consider this. Both Bersani and Berlusconi had coalitions. Grillo, with his 25%, actually has the largest party in terms of votes cast.]

But in the Senate, while Bersani took 31.6% to Berlusconi’s 30.7%, Berlusconi gained the most seats, 116 to 113, because he did better in some key regions (think our Electoral College). Grillo gained 23.8%, good for 54 seats, and Monti only polled 9.1%, leaving him with 18. 

You need 158 seats to have the majority in the Senate so you can see that if you combine Bersani with Monti, that’s only 131.

Ergo, crisis. Intraday, the Italian stock market fell 9% from its peak on Monday morning before reality hit with the tally of the first votes once the polls closed that afternoon. The yield on Italy’s debt soared and Euro equity markets tanked.

If you don’t know anything about Grillo and his protest movement, the party doesn’t have a platform, but they want to throw everyone out. He also doesn’t want to form a coalition with either Bersani or Berlusconi, Grillo saying of the latter (who staged a helluva comeback himself) that he needs to seek medical attention.

What’s the solution? Berlusconi has offered to form a coalition with Bersani, a grand alliance of center-left and center-right, but Bersani doesn’t want that, having offered Grillo the speakership of the lower house, which Berlusconi would have none of for obvious reasons. Plus Grillo wants to be the opposition. [As for Monti, he’s basically irrelevant. The guy is respected in the halls of Brussels and by the Germans. His poll numbers say it all when it comes to his standing among the Italian people.]

Anyway, the respected head of state, President Giorgio Napolitano, will probably tap Bersani to form a new government, though nothing happens officially until a new parliament convenes March 15.

Grillo hopes Bersani and Berlusconi hook up because he’s then convinced the partnership wouldn’t last more than a few months, thus forcing a new election which Grillo’s movement could win outright, given its tremendous momentum. Of course this scares the hell out of Bersani, Berlusconi, Monti...just about any Italian politico because the Five-Star party is, after all, anti-establishment!

“The people that have destroyed this country are now trying to get back together to carry out reforms to the things that they have destroyed. The public won’t accept that anymore.”

Oh, and back to Ben Bernanke and his comment that all four parties or blocs at least wanted to stay in the euro, understand Grillo wants a referendum on the topic, while Berlusconi spent his campaign blasting Monti’s reforms and the latter’s allegiance to both Brussels and Germany; blaming Chancellor Angela Merkel specifically for forcing austerity on the Italian people.

“The euro crisis is back. Actually, it never left. But there was an extended period, beginning last summer, when Europe’s political, business and media elites convinced themselves that the worst had passed. The European Central Bank – Europe’s Federal Reserve – had tranquilized jittery bond markets. Italy and Spain, the two countries that might trigger a new crisis, would be able to borrow at reasonable interest rates, because the ECB had pledged to act as a lender of last resort. Though debtor nations still faced hard times, matters were slowly mending. So it was said.

“No more. Italy’s latest election quashes this optimism. The outcome seems a mix of absurdity and anarchy....

“But Italians did send a message. ‘The election wasn’t just anti-austerity. It was also anti-German,’ says David Smick, editor of the International Economy magazine. ‘Berlusconi’s rhetoric was very anti-German. In Italian politics now, it’s dangerous to appear being the lapdog of Angela Merkel.’ In one dazzling stroke, Italian voters rejected both Europe’s main response to high government debt – cut spending, raise taxes – and the policy’s most powerful architect, Germany’s Merkel. If Italy needs to be bailed out, the negotiations already look tortuous....

“The day after the election, the rate on Italy’s 10-year government bonds rose from 4.5 percent to 4.9 percent – a large one-day move. [Ed. try 4.17 to 4.96, intraday, in just two days.] That’s still well below last summer’s peak of 6.6 percent, but if financial markets decide that Italy’s situation is slipping out of control, it will slip out of control. Interest rates will rise; the debt burden will increase. At some point, Italy – the eurozone’s third-largest economy – might need a bailout. Spain – the fourth largest – might, too.

“The amounts required would dwarf the rescues of Greece, Portugal and Ireland. Agreement would be hardly guaranteed. As conditions for aid, the ECB and Germany have insisted on precisely the austerity and structural changes that Italian voters just rejected. Could Italy, backed by other debtor nations, force changes in old policies and, if not, what happens? Europe’s future remains in play.”

Meanwhile, the eurozone saw data on manufacturing for February, the PMI, and for the region as a whole it came in at 47.9, unchanged from January, though a tick up from the 47.8 flash number, 50 being the dividing line between growth and contraction. An index of new export orders at least came in at 51.7 for the month.

Germany’s PMI for February rose to 50.3, a 13-month high, but downturns remained marked in Spain (46.8), Italy (45.8), France (43.9) and Greece (43.0), even if the reading was better than January in three of the four, Italy being the exception. [Data courtesy of “Markit”]

Eurostats released the latest employment data and the euro area’s unemployment rate for January was 11.9%, up from 11.8% in December. The EU27 rate was 10.8%, up from December’s 10.7%.

Germany’s unemployment rate was 5.3% (the government uses a different measurement and pegs it at 6.9% today), while in France it’s 10.6, Italy 11.7, Portugal 17.6, Spain 26.2 and Greece 27.0 (though Greece’s data is just through November 2012).

The youth rate in some of the countries remains at catastrophic levels: Italy 38.7%, Portugal 38.6, Spain 55.5 and Greece 59.4.

Germany’s retail sales for the month of January were up 3.1% over December, the biggest rise since 12/06.

In the UK, forecasted GDP for 2013 was revised to up 0.2% from unchanged, but its manufacturing PMI for February fell to 47.9, the worst reading since October.

And Spain’s deficit as a percentage of GDP came in at 6.7% for 2012, a little better than expected though short of the EU’s target, plus the figure doesn’t include the massive bank-recapitalization plan in the country, otherwise the number is 10.2%. The EU still wants new tax increases and spending cuts.

Street Bytes

--In a volatile week, stocks finished mixed, with the three major large cap indexes registering fractional gains while the small- and mid-cap issues took losses. The Dow Jones finished up 0.6% to 14089, just 75 points shy of its all-time high of 14164 set back on Oct. 9, 2007. The S&P and Nasdaq each rose 0.2%, with the former, at 1518, now just 47 points shy of its all-time high set on the same date.

--U.S. Treasury Yields

6-mo. 0.12% 2-yr. 0.24% 10-yr. 1.84% 30-yr. 3.05%

--China’s manufacturing PMI figure for February was just 50.1 vs. 50.4 in January, though the fifth month of expansion. [HSBC’s final figure for the month was 50.4 after a January reading of 52.3.]

New home prices rose a ninth straight month in February, not good, so the government will be intensifying its efforts to prevent a collapse in the sector.

Bottom line, the Chinese economy remains very fragile and this week, as Xi Jinping takes over, the government will issue its GDP forecast for 2013 and it is expected to say 7.5%, same as 2012, though the final number came in at 7.8%.

--In a good sign for the global economy, Taiwan’s export orders climbed the most in more than two years in January, up 18% from a year earlier, and up 28.7% to China, while those to the U.S. rose 15.5%. Taiwan’s unemployment rate fell to 4.2% for the month as well. As Ronald Reagan would have said...not bad, not bad at all.

--Japan’s consumer price index for January fell 0.2%, ex-food, the third straight decline and underlining just why Prime Minister Shinzo Abe wants an aggressive Bank of Japan. Stoking inflation is the key to growth, says Abe. When prices rise, consumers should want to buy goods earlier rather than waiting for further price declines.

--JPMorgan Chase is eliminating 17,000 jobs over the next two years, 13,000-15,000 of which will be in mortgage banking, though many of the positions will be lost through attrition, or so it’s hoped.

--In the aforementioned Case-Shiller 20-city housing index data for the month of December, year-over-year, Phoenix showed the biggest rise, 23%, with San Francisco second at 14.4%. Of the 20 metropolitan areas, only New York saw average price declines, though just 0.5%.

--The average cash bonus for those employed in the financial industry in New York last year rose 9% to $121,900, according to New York State’s comptroller. Cash bonuses in total are expectd to rise 8% to $20 billion this year.

But the total is down from 2010’s $22.8 billion, and the peak was 2006, before the financial crisis, when total bonuses hit $34.3 billion.

Wall Street employment, despite recovering some since the crisis, is still far below pre-crisis levels* and this all means one thing. Far less tax revenue for New York State and New York City.

Before the crisis, business and personal income tax collections from finance-related activities accounted for up to 20% of New York State tax revenue and last year that fell to 14%. [Susanne Craig / New York Times]

*Comptroller Thomas DiNapoli estimates New York’s securities industry lost 28,300 jobs during the financial crisis and has regained about 8,500 since. [Mark DeCambre / New York Post]

--Ireland’s economy is expected to grow 1.1% this year and 2.2% in 2014, according to the European Commission. Unemployment, though, is expected to remain above 14% over this time; currently 14.8% and dropping to 14.1% in 2014. 

--Apple CEO Tim Cook acknowledged shareholder unease over the tech giant’s share price, saying, “I don’t like it either. The board doesn’t like it.” But Cook made no promises when it came to Apple’s $137 billion in cash. [The shares closed at a 52-week low on Friday, $430; off from the $705 intraday high on Sept. 21.]

--Groupon co-founder and CEO Andrew Mason was ousted from the online deals company following a bigger-than-expected loss and weak revenue prospects. Personally, on 2/12/11 in this space I said I was “highly skeptical” of Groupon’s prospects and on 6/4/11 wrote I was “unimpressed.” For those who have been impressed, yes, Groupon was first but as more than a few observed after the company went public in November 2011, the model was easy to replicate. The stock is now down about 75% from its IPO level.

“After four and a half intense and wonderful years as CEO of Groupon, I’ve decided that I’d like to spend more time with my family. Just kidding – I was fired today.”

--Herbalife said it will allow billionaire investor Carl Icahn to pick two new board members, as well as allow Icahn to up his stake to as much as 25% from the 14% or so he has already disclosed. Icahn could force a sale, or over time take it private as the company wrestles with activist hedge fund operator Bill Ackman who has heavily shorted HLF, calling it a “Ponzi scheme.”

--The aforementioned Mr. Ackman took it on the chin in another favorite of his this week, J.C. Penney, which fell over 20% on a totally atrocious earnings report with revenues falling far short of expectations, a net loss that rivaled Napoleon’s in Russia, and a same-store sales figure that matched the uniform number of the great Jim Brown, 32, only put a minus sign in front of it. CEO Ron Johnson, not to be confused with the former New York Giant star running back of the same name, deserves to be sent to Chelyabinsk to search for meteorite fragments.

--Yahoo CEO Marissa Mayer ruffled more than a few feathers when she abolished the company’s work-at-home policy and ordered everyone to work in the office, as an internal memo from HR said face-to-face interaction fostered a more collaborative culture.   More than a few companies who had liberal policies in this regard are requiring their employees to come back. To state the obvious, it’s about control. Critics rail that Mayer’s decision is a retrograde approach and severely impacts those caring for young children. As Ruth Rosen, a professor emerita of women’s history at the University of California told the New York Times:

“The irony is that (Mayer) has broken the glass ceiling, but seems unwilling for other women to lead a balanced life in which they care for their families and still concentrate on developing their skills and career.”

The Bureau of Labor Statistics says 24% of employed Americans report working from home at least some hours each week. 63% of employers say they allow employees to work remotely, up from 34% in 2005.

Mayer is receiving a ton of criticism, including in a column by the New York Times’ Maureen Dowd, for being insensitive on the child care front, this as Mayer has an in-house nursery for her own newborn.

--Auto sales in the U.S. for the month of February were solid, though not spectacular; up 3.7% to 1.2 million. Adjusting for seasonal fluctuations, the full year sales pace would be 15.38 million.

General Motors saw its sales rise 7.2%, while Ford Motor’s increased 9.3% and Chrysler’s rose 4.1%.

Toyota reported a 4.3% rise, but Honda’s declined 2% and Nissan’s fell 6.6% over a year earlier.

--Meanwhile, Lexus topped Consumer Reports’ 2013 annual ranking of car brands and vehicles. Subaru and Mazda tied for second. 8 of the top 10 scores were earned by Japanese brands and none of the domestic automakers made the top 10.

Honda’s redesigned Accord landed the top mid-sized car ranking.

--Warren Buffett’s Berkshire Hathaway Inc. reported late Friday, with the value of the company rising 14%, though this was shy of the S&P 500’s 16% total return for 2012. Buffett called his performance “subpar.” It’s just the ninth time in 48 years the company has lagged the market, but the third in four years. Buffett bemoaned the fact he couldn’t land an elephant in 2012.

While Buffett didn’t talk of succession plans, he said the two investment managers Berkshire has hired in recent years, Todd Combs and Ted Wechsler, outperformed the S&P by double digits last year.

--According to a report from the Federal Reserve Bank of New York, about a third of student-loan borrowers were delinquent at the end of last year, up from a quarter in 2008.

--With the two recent storms in the Plains and Midwest, the percentage of the U.S. experiencing drought conditions dropped to 54.1%, the first drop below 55 since July, according to the U.S. Drought Monitor. 

--New Jersey took a major step towards adopting online gambling this week, with Gov. Chris Christie signing a bill that would allow current casino operators in Atlantic City to operate online sites in the state.

While it will take a while to get things up and running, for those of you writing in asking me to be your bookie, I am more than happy to but this bill is not about sports betting. That will come separately, though I don’t see it being so in time for the next NFL season, plus a federal judge just blocked the state’s bid, though Christie vows to continue the fight.

[Err, note to the FBI and any other interested authorities... I’m just kidding. Note to friends: No, I’m not.]

--As reported by the AP’s Meghan Barr, incredibly, nearly four months after Hurricane Sandy, “roughly 85% of small businesses near (New York City’s) South Street Seaport are still boarded up. It could be months before some reopen, while others may never return.”

My Wall Street friends working in the area have told me this but I hadn’t seen such dreadful figures.

--Due to the horsemeat scandal in Europe, sales of frozen burgers and ready-made meals are plummeting. In the UK, frozen burger sales fell 43% in the four weeks to Feb. 17, with frozen meals down 13%. Consumers, as reported in the London Times, were highly critical of how individual manufacturers responded to the crisis.

--Anheuser-Busch InBev NV said domestic U.S. beer shipments rose 1.5% in the fourth quarter, compared with a decline of 2% in the same period a year ago. My own consumption rose a like amount. Just sayin’.

--But beer drinkers have filed lawsuits in three U.S. states claiming Anheuser-Busch is watering down its beers, mislabeling Budweiser, Michelob and other brands to cut costs. The suits claim former employees at the company’s 13 breweries are cooperating and that as a matter of corporate practice, all the products are watered down.

That’s why I drink Coors Light...because it uses Rocky Mountain spring water.

--Sign of the Apocalypse: “The night shift at a Chivas Brothers distillery screwed up this week and accidentally flushed about 6,000 gallons of Scotch whisky down the drain, according to reports from Scotland....

“Instead of purging the wastewater, they expelled 18,000 liters of bulk whisky into the local sewage system.” [Michael Winter / USA TODAY]

Local sewage crews learned of the mistake before company officials did. Both the smell and the sight of tipsy rats were tip-offs something was amiss.

--Finally, we note the passing of Paul C.P. McIlhenny of Tabasco pepper sauce fame, McIlhenny Company being one of the great American success stories. Mr. McIlhenny was chairman and CEO of the family-owned operation and during his tenure, the company achieved record growth, owing in part to the introduction of new products such as chipotle sauce. I’ve always wanted to get down to this place, Avery Island. Paul McIlhenny was 68.

Foreign Affairs

Iran: As details of this week’s talks in Kazakhstan emerge, a new proposal presented to Iran would alleviate some of the sanctions, including on the gold trade, in return for Iran suspending its operations at its key underground nuclear plant at Fordo, though not permanently closing it.

Further talks are now slated for March 18 in Istanbul and then full delegations on April 5 and 6 back in Almaty, Kazakhstan.

Israeli Prime Minister Benjamin Netanyahu said sanctions should be tightened, not relaxed, and backed up by the threat of a military strike.

“Like North Korea, (Iran) continues to defy all the international standards and I believe that this requires the international community to ratchet up its sanctions and make clear that if this continues there will be also a credible military sanction.”

Former Israeli foreign minister and Netanyahu coalition partner, Avigdor Lieberman, said:

“It is clear that Iran intends to drag this process out while they gallop toward nuclear capability. The time has come to move on to steps that are much more significant than the negotiations and sanctions taken until now. We are not deluded.”

A senior Republican aide told the Jerusalem Post that the news out of Kazakhstan “is startling to many in Washington and certainly in Jerusalem where decisions of war and peace are nearing final calculation. The gold sanctions relief being offered would blow a hole straight through our final sanctions and meanwhile Iran would keep its capacity to enrich [uranium] at 20% or higher.”

The Daily Telegraph reported that Iran is developing a second path to achieving an atomic weapon by operating a heavy water plant in Arak that could produce plutonium. Of course heretofore Iran’s activities have been on the uranium front. Satellite images show the Arak facility is heavily defended on the western side of it, the most direct line of approach for a long-range strike by Israel.

“The most interesting public result of the latest talks with Iran on its nuclear program was the claim by Tehran’s chief negotiator, Saeed Jalili, that the new negotiating proposal from the United States and five partners was a possible ‘turning point’ in what has been nearly a decade of fruitless diplomacy. Those cheery words, and the Iranian’s quick agreement to two follow-up meetings in the next five weeks, raised the question of whether the regime is positioning itself to strike a deal that would freeze the most dangerous elements of its nuclear work in exchange for an easing of the sanctions that are choking its economy.

“We hope that is the case. Unfortunately, an equally plausible explanation for Mr. Jalili’s comment was that he was celebrating the fact that, in the eight months since Iran last agreed to meet with the international coalition, the offer to Tehran had grown more, rather than less, generous. ‘It was they who tried to get closer to our point of view,’ he crowed, while adding that there remained ‘a long distance to the desirable point.’....

“If Iran altered its own, unacceptable proposals from previous rounds, there was no indication of it in the accounts of either side. That raises the possibility that the regime will simply pocket the easier terms and return to its stonewalling, with the expectation that another crumbling of the coalition position will ensue. In recent months, Tehran has avoided crossing Israel’s red line for military action by keeping its stockpile of medium-enriched uranium below the quantity needed for a bomb, but it has also begun installing a new generation of centrifuges, which could move it much closer to a breakout capacity. Maybe these zigs and zags, like Mr. Jalili’s declarations, are the prelude to a compromise. But history suggests they are the tactics of a regime convinced that it can outlast and outmaneuver the United States and its partners.”

“ ‘Iran has a government that was elected and that sits in the United Nations.’ So said John Kerry in Paris on Wednesday, on his first tour of Europe since becoming Secretary of State. The former Senator was answering a reporter who asked why he had publicly applauded the French for refusing to negotiate with terrorists in Africa – on the same day the U.S. and its allies were trying to negotiate a nuclear deal with a ‘terrorist’ regime in Tehran....

“Mr. Kerry also knows that the last time Iran had an election for the secondary post of president, the results were almost universally regarded as fraudulent. He knows that the re-installed government of Mahmoud Ahmadinejad responded to protests by murdering demonstrators in the streets, putting defeated candidates under house arrest, and jailing hundreds if not thousands of Iranians suspected of opposition sympathies....

“We realize the Administration is eager to cut a deal with the mullahs before they cross the point of nuclear no return, and sometimes talking with nasty regimes is necessary in diplomacy. But a U.S. Secretary of State owes the Iranian people better than to pretend their government can claim any sort of popular consent other than what it exacts through brute force.”

Syria: The Obama administration announced it would provide the Syrian opposition with an additional $60 million in assistance, though for the first time nonlethal aid like food and medical supplies is going directly to them. Secretary of State Kerry, at a meeting of European allies in Rome, said:

“We do this because we need to stand on the side of those in this fight who want to see Syria rise again and see democracy and human rights. The stakes are really high, and we can’t risk letting this country in the heart of the Middle East being destroyed by vicious autocrats or hijacked by the extremists.”

Whatever. It’s been two freakin’ years! Kerry continued...

“No nation, no people should live in fear of their so-called leaders,” adding that President Obama’s “decision to take further steps now is the result of the brutality of superior armed force propped up by foreign fighters from Iran and Hizbullah.”

Head of the Syrian Opposition Coalition, Mouaz al-Khatib, said, “The media pays more attention to the length of the beards of the fighters than the massacres.”

“Nothing has changed, the U.S. position of no arming is crystal clear,” said Mohammad Sarmini, a spokesman for the Syrian National Council. “This has become embarrassing and degrading. The regime’s escalation has rendered even our unmet pleas foolish. We used to beg for antiaircraft missiles. What do you ask for to counter Scuds?”

The crime over the past two years is that the Obama administration has lost the war to have a say in what follows Assad. As I’ve noted countless times before, we’ve lost an entire generation of Syrians, who now have zero reason to respect America through its lack of aid and support.

Rachel Kleinfeld commented in an op-ed for the Wall Street Journal:

“The young people spearheading the Arab Spring are trying to decide what America stands for – whether it cares about their human rights and empowerment or is merely seeking cheap global oil and easy alliances. Inaction in Syria is not good for the U.S. in a region where more than 60% of the population is under age 30. America will lose this generation for the next 50 years if it is not on their side now.”

Washington also claims it has previously provided $385 million in humanitarian aid to Syrians but none directly to the rebels. This is a lie. Even the U.N. has said on many occasions that the gap between promises of aid and actual delivery of same is wide.

“U.S. policy must...aim at helping the rebels establish a full-fledged alternative government on Syrian territory and recognizing it as the legal government of Syria. That would legitimize the supply of arms and allow the U.S. military to protect the Syrian population with airstrikes or Patriot anti-missile batteries, if that were necessary to stop the regime’s unconscionable targeting of civilian neighborhoods with missiles and artillery. It could also help to marginalize the growing al-Qaeda presence in rebel forces....

“But in public, Mr. Kerry has spoken only of increased aid to the opposition Syrian National Coalition – which also has yet to receive direct U.S. aid. The Post has reported that new supplies of weapons are reaching rebels in southern Syria, probably with financing from Saudi Arabia and coordination by the United States. This is the extension of an operation that has been underway for some time, but it is too small to quickly decide the war.

“Mr. Kerry still speaks of seeking ‘a political solution,’ though the hope of brokering a deal between the regime and the rebels proved illusory long ago. He says that he aims to ‘change the calculation on the ground for President Assad,’ as if it were still conceivable that this blood-drenched butcher could be induced to quietly step down. And Mr. Kerry is still seeking the cooperation of Russia in ending the war, though Vladimir Putin has made it clear that his first purpose in Syria is preventing a U.S.-engineered regime change.

“Such tactics are doomed to failure. They will serve only to prolong and intensify the bloodshed, to the ultimate benefit of al-Qaeda and those, such as Iran’s leaders, who would prefer endless civil war to any change of government. If the Obama administration is to lead on Syria, it must commit itself to steps that can bring about the early collapse of the regime and its replacement by a representative and responsible alternative. Only direct political and military intervention on the side of the opposition can make that happen.”

Meanwhile, Human Rights Watch confirmed this week that the Assad regime recently fired four Scud missiles on parts of Aleppo, killing at least 141, including 71 children. “Just when you think things can’t get any worse, the Syrian government finds ways to escalate its killing tactics,” said lead investigator Ole Solvang.

And Jordanian authorities said there has been a new surge in Syrians fleeing across the border into Jordan, some 3,000 per night in recent days. Jordan said the number of Syrians in camps will swell to 500,000 this month. 500,000 is the expected total in Lebanon as well over the coming weeks. Neither can handle this load, on top of existing sectarian and/or refugee issues.

Lebanon: Hizbullah leader Sheikh Nasrallah denied rumors he was in Iran for cancer treatment, saying in an internal Hizbullah broadcast, “The rumors spread in the previous days made me hold an urgent media appearance to show you that I am in good health.”

Nasrallah also denied rumors his deputy was killed in an attack by Syrian rebels.

Egypt: President Mohamed Morsi scheduled parliamentary elections for April 22 onward in a cumbersome process that will last into June. Opposition leader Mohamed El Baradei called for a boycott, saying he “will not be part of an act of deception,” i.e., a rigged election that legitimizes Egypt’s “sham democracy.” The opposition also says elections should not be held until a dispute over the new constitution is resolved, the constitution produced by the Islamist-dominated assembly.

However, some in the opposition say it does no good to boycott the elections and I agree. If it’s a sham, let the world see it as such. Or as Amir Taheri wrote in an op-ed for the New York Post:

“Those who claim to represent Egyptian democracy should start acting as democrats themselves.”

Separately, with the Egyptian economy already in a shambles, and with the critical tourism industry devastated, this week’s balloon disaster that claimed 19 tourists’ lives in Luxor could not have come at a worse time. Consider this is normally high season in Luxor, home to some of Egypt’s most famous sites. Prior to the crash, in a normal year the hotels would be full. This week they were 25% occupied. Then this catastrophe.

Afghanistan: At least 30 police officers were killed on Thursday and Friday, with in bomb attacks or by recruits loyal to the Taliban.

Earlier, President Hamid Karzai ordered all U.S. Special Operations forces to leave the strategically important province of Wardak in two weeks, alleging that they had been involved in the torture and murder of “innocent people.” Karzai cited no evidence or judicial readings. What a piece of work he is. Wardak borders Kabul and is used by the Taliban in some sections to infiltrate the capital.

“In his latest act of ingrate treachery, Afghan President Hamid Karzai has ordered U.S. Special Forces out of Wardak...His demand came two weeks after he halted U.S. close air support for the Afghan National Army, crippling his own military’s capabilities.

“And that came atop multiple incidents when ‘our man in Kabul’ blamed U.S. troops for everything that went wrong in his wretched country.

“That’s what you get for $600 billion these days. Without our support and protection, Karzai would have been swinging from a lamp post years ago – just as his predecessor Najibullah did in 1996. But stuck in our strategic battered-wife syndrome, we’ve continued to make excuses every time Karzai lashed out at us.

“The decisive point came in 2009, when we let him steal the presidential election, discrediting all our rhetoric about democracy and the rule of law....

“Two thousand American troops have died to keep in power an unscrupulous incompetent who isn’t even grateful. And Karzai is confident that we’ll keep the money flowing after we leave. Meanwhile, he appears to be cutting deals with side-jumping tribal chieftains, fence-sitters and our outright enemies to ensure his own survival....

“My bet is that Karzai isn’t half as smart as he thinks he is. If he’s expecting to cut a deal with Taliban elements, he may be focused on the wrong threat. By pandering to terrorists and halting the U.S. air support his army desperately needs, he may have set himself up for a post-American coup staged by Afghans who actually care about their country.

Russia: President Vladimir Putin called on his top military leadership to deliver a “drastic upgrade” to the country’s military capabilities over the next three to five years to thwart “systematic attempts to undermine the strategic balance.”

Speaking at a meeting of the Defense Ministry Board, Putin said the current geopolitical conditions demanded “swift actions.” He identified potential threats, including U.S. missile defense deployment, further eastward NATO expansion and militarization of the Arctic. “All these challenges...all of this directly affects our national interests and, accordingly, defines the placement of our priorities.” [Ivan Nechepurenko / Moscow Times]

North Korea: No word on whether former NBA star Dennis Rodman is the new Bill Richardson, but Rodman is the first American of note (using the term loosely) to meet with Leader Kim Jong Un, this after the North warned the top American commander in South Korea last weekend of “miserable destruction” if the U.S. presses ahead with routine joint drills with the South set to begin this month.

Meanwhile, in Seoul, Park Geun-hye, daughter of Park Chung-hee, the military leader who ran the country until he was assassinated 34 years ago, was sworn in this week as South Korea’s first female president, saying in her inaugural, “North Korea’s recent nuclear test is a challenge to the survival and future of the Korean people.”

Japan: Prime Minister Shinzo Abe, in a speech to members of the U.S. foreign policy establishment, chose not to focus on the economy and his monetary stimulus initiative, but rather spoke of Japan as a reinvigorated power.

“Japan is not, and will never be, a tier-two country. It is high time, in this age of Asian resurgence, for Japan to bear even more responsibility to promote our shared rules and values.”

Abe reasserted Tokyo’s claim to the Senkaku Islands in the East China Sea which China claims as well (Diaoyus, to Beijing). Abe said Japan “simply cannot tolerate any challenge now, or in the future.”

China: Communist Party leader Xi Jinping formally adds the title of president this week at a session of parliament, so we eagerly await his comments. At least regarding Taiwan, Xi told a Taiwanese visiting official this week that his team would continue to build cross-strait ties and strive for “peaceful reunification” with the island.

On a totally different matter...the behavior of the Chinese in general...the following is from a piece by Amy Li in the South China Morning Post:

“Two Chinese men on an Air France flight recently shocked their fellow passengers by snatching eight bottles of wine from the airline service cart, ignoring objections from other travelers on board.

“Wen Fei, a Chinese woman who works in Paris, wrote on weibo, China’s Twitter-like service about her encounters with the two men who sat near her on flight AF-132 from Paris to China’s central Wuhan city on Friday.

“Wen said she tried to stop them after they each took at least eight bottles of wine and stowed them in their bags – without asking the flight crew.

“ ‘I explained to them it was not OK and interpreted the flight attendants’ explanation in French, but they said it was none of my business,’ Wen told SCMP.com on Tuesday.

“The two men, apparently drunk, then shouted at Wen in the Wuah dialect, she said.

“ ‘They asked me to back off if I ever wanted to leave Wuhan in one piece,’ said Wen.

“The pilot later interfered and asked the men to stop fighting with Wen, she said.

“ ‘This kind of behavior is demeaning for the Chinese traveling abroad,’ she added.

“Wen also posted a picture she had secretly taken of one of the two men. The photo shows a middle-aged man wearing glasses and well-dressed.

“Wen’s post struck a chord with many netizens who said they, too, find the behavior of some Chinese travelers appalling.

“ ‘The Chinese are always loud and jump queues to get on a flight – even when everyone has a seat,’ said a netizen.

“ ‘They are used to ‘stealing’ from people in China and now they start applying that habit elsewhere,’ commented another netizen, implying the two men might be powerful Wuhan officials.

The Chinese, as we’ve learned through their hacking of Corporate America, and as I learned personally with a certain investment of mine, steal from people the world over.

Bangladesh: After a war crimes tribunal handed down a death sentence to an Islamic leader for crimes against humanity committed 42 years ago during the country’s 1971 war of independence, mass protests and clashes with security forces have left at least 44 dead.

Mali: Chadian forces, in support of the French and Malians here, engaged the Islamists in the rugged north and killed at least 90 while losing 25 of their own, according to officials. [French troops killed an additional 40].  Chad is providing 2,000 battle-hardened troops to the fight in Mali. 

And this just in...Chadian President Deby said a senior al-Qaeda leader was killed in northern Mali (confirmed by the U.S.). So we hereby select Chad’s military as our “Army of the Week.”

Venezuela: President Hugo Chavez is near death, with the vice president announcing on state-run television that Chavez is “battling for his health, for his life and we are accompanying him.” 

Cuba: 81-year-old Raul Castro announced his new presidential term would be his last and that he would step down in 2018, if not before, while tapping 52-year-old Miguel Diaz-Canel to be his successor.

Castro hinted at some changes to the constitution, such as term limits, but he scotched any idea that Cuba would abandon socialism.

“I was not chosen to be president to restore capitalism to Cuba. I was elected to defend, maintain and continue to perfect socialism, not destroy it.”

Random Musings

“The biggest story for America today is the automatic spending cuts triggered by the sequester. The biggest story for the DC Beltway? Whether Bob Woodward was ‘threatened’ by the White House.

“The Washington Post veteran became the news after writing that President Obama’s insistence that the Republicans agree to raise taxes to avoid a sequester amounted to ‘moving the goalposts.’ On Wednesday, he followed up by calling the president’s statement that an aircraft carrier would not be deployed because of the sequester ‘a kind of madness.’”

So the White House was furious, senior aide Gene Sperling blasted and perhaps threatened Woodward, but as the Post concludes:

“The story isn’t whether Bob Woodward was right when he said he interpreted the words of the White House e-mail as a threat. It’s whether he was right when he reported that the president isn’t telling the truth about his role in the sequester, and is behaving badly, as his actions on national security show.

“America is still waiting for the White House press corps to take up that story.”

--The Senate finally voted to confirm Chuck Hagel to be the nation’s next defense secretary, 58-41, with Hagel receiving the votes of just four Republicans. President Obama said in a statement “we will have the defense secretary our nation needs and the leader our troops deserve.”

I was on record as liking Chuck Hagel and initially supporting him but his performance at his confirmation hearing was beyond disgraceful. I agree with South Carolina Rep. Sen. Lindsey Graham, who said “I hope, for the sake of our national security, he exceeds expectations.”

--Republican Senators John McCain and Graham had an unusual meeting with President Obama at the White House on Tuesday, ostensibly over immigration reform, and emerged with praise for Obama’s leadership and optimism on the issue.

“It was one of the best meetings I’ve ever had with the president,” Graham said. “I think the president’s very sincere in wanting a bill and wanted to know what he could do to help.”

--China’s military said Thursday that computer hackers, two-thirds of which originated in the United States, targeted two of its websites an average of 144,000 times per month last year.

Good! That’s the way it’s supposed to work! Each military tries to hack each other.

But when you go after our intellectual commercial property, you’ve crossed the line, Commies.

--New York City’s murder rate continues to decline from record levels, while Chicago’s skyrockets, and one new approach NYPD Commissioner Ray Kelly has taken is to go after teen gang members in a big way, like in charging them with conspiracy while heavily monitoring their use of social-media sites to build mafia-style cases against them.

Kelly, despite budget cuts, has doubled the gang division’s strength after finding that the “small crews of trigger-happy thugs are responsible for 30 percent of all the shootings in the city,” as he related to the New York Post.

--We note the passing of former surgeon general C. Everett Koop, who drew America’s attention to the then-emerging AIDS epidemic while serving in the Reagan and George H.W. Bush administrations, as well as railing against smoking. A man who made a difference. Koop was 96.

--And the great Van Cliburn, died. He was 78. It was 1958, during the height of the Cold War, when his performances of Tchaikovsky’s First and Rachmaninoff’s Third piano concertos wowed the crowds in Moscow at the first International Tchaikovsky Competition, not only winning it but becoming a world celebrity in the process.

It was right after Sputnik and Van Cliburn gained a cultural victory for America. It’s impossible to understand today but there he was, a classical pianist, being feted with a ticker-tape parade in New York City.

Heck, I think my first piano lesson was in 1966 or thereabouts and he was still the best-known American pianist, even though his skills, according to reviewers, were already fading.

But back in Moscow 1958, he was so great, he had the Soviet crowd erupting with a standing ovation.

According to Howard Reich, who wrote a biography of Van Cliburn, the Soviet minister of culture feared the consequences of awarding the American the top prize, so they took it all the way to the top, the chairman of the Council of Ministers, Nikita Khrushchev.

“Yes, he is the best,” the minister of culture replied.

“In this case, give him the first prize,” Khrushchev said. [Dennis McLellan / Los Angeles Times]

--Army Pfc. Bradley Manning pleaded guilty to 10 charges that he illegally acquired and transferred highly classified U.S. government secrets, agreeing to serve 20 years in prison for causing a worldwide uproar when WikiLeaks documents were published. Manning did, however, plead not guilty to 12 more serious charges that will eventually go forward at a general court-martial in June. If convicted then, he could receive life in prison.

But in testimony, Manning contended no one from WikiLeaks pressured him to turn over documents, thus hurting the government’s case against WikiLeaks founder Julian Assange.

In a statement from Britain, Assange was quoted as saying Manning was “America’s foremost political prisoner.”

Personally, I was hoping Manning would receive the ultimate penalty, ditto, eventually, Assange, who through his attorney threatened yours truly, which shook me up for about 48 hours before I realized I had far more important things to worry about than an alleged rapist holed up in an embassy in Britain. 

--Speaking of rats, scientists from Duke University, bearing no resemblance to Coach K., teaming up with brethren in Brazil, found that rodents collaborated with each other “telepathically across continents in the first use of neurotechnology to transmit thoughts directly between animals’ brains,” as reported by the Financial Times’ Clive Crookson.

“In the first experiment they had to press the correct lever corresponding to a particular indicator light; in the second they had to distinguish between wide and narrow openings.

“Electrodes picked up the brain activity of the first rat, the ‘encoder,’ and fed it over the internet into the brain of its partner, the ‘decoder,’ which had the same levers in its cage but received no visual cues about which one to press. The best decoder rats correctly mimicked their corresponding encoder partners 70 percent of the time.”

--So I watched the Academy Awards and felt mild disapproval in seeing Michelle Obama handing out the Best Picture award from the White House. Nonetheless, I agree with Anita McBride, who served as chief of staff to first lady Laura Bush.

“(Michelle is) as glamorous as any other star, (and) she is comfortable in that role. As far as the optics in the national conversation, you can see where the other half have come down, (asking) ‘Is this really necessary?’” [Krissah Thompson / Washington Post]

--It’s always been known that the Mediterranean Diet, one with lots of olive oil (especially extra virgin olive oil), fish and nuts was good for you, but now an extensive study of nearly 7,500 people in Spain over almost five years has offered conclusive proof. So conclusive that not only was the study ended early so that participants not on the diet could switch to the beneficial treatment, but renowned Dr. Steven Nissen, chairman of the department of cardiovascular medicine at the Cleveland Clinic, who was not part of the study, said it was “hugely important” and that the preventive effect of the diet is similar to the effect of taking statins, the cholesterol-lowering drugs.

“I’m going to change my own diet; add some more olive oil, some more nuts,” said Nissen.

Participants on the Mediterranean diet ingested at least four tablespoons of the oil or a fistful of almonds, walnuts and hazelnuts daily. The risk of stroke and other major cardiovascular problems can be reduced by 30% among high-risk people.

Those on the diet were also allowed to have at least seven glasses of red wine a week, sports fans. [Wall Street Journal / New York Post]

--Pope Benedict XVI left the Vatican on Thursday, first noting on Twitter: “Thank you for your love and support. May you always experience the joy that comes from putting Christ at the center of your lives.”

Appearing at a window overlooking the square in Castel Gandolfo, Benedict added: “Thank you very much for your friendship....I will simply be a pilgrim who is starting the last phase of his pilgrimage on this earth.

“Let’s go forward with God for the good of the Church and the world.”

Earlier, the pope tried to defuse concerns about his future role in a surprise address to the cardinals, where he pledged his “unconditional reverence and obedience” to his successor, adding:

“May the College of Cardinals work like an orchestra, where diversity – an expression of the universal church – always works toward a higher and harmonious agreement.”

Personally, while I love Cardinal Dolan of New York, I’m betting on the Canadian.

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

Gold closed at $1574
Oil, $90.92

Returns for the week 2/25-3/1

Dow Jones +0.6% [14089]
S&P 500 +0.2% [1518]
S&P MidCap -0.5%
Russell 2000 -0.2%
Nasdaq +0.2% [3169]

Returns for the period 1/1/13-3/1/13

Dow Jones +7.5%
S&P 500 +6.4%
S&P MidCap +7.6%
Russell 2000 +7.7%
Nasdaq +5.0%

Bulls 46.3
Bears 21.1 [Source: Investors Intelligence]

Have a great week. I appreciate your support.

Dr. Bortrum posted a new column.

Nightly Review video schedule Mon. thru Thurs., posted around 5:30 PM ET.

Brian Trumbore

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