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02/24/2018

For the week 2/19-2/23

[Posted 11:30 PM ET, Friday]

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Edition 985

I watched it all this week...the White House listening session, the CNN town hall, Trump’s CPAC speech, and his Friday press conference with Australian Prime Minister Turnbull.

I was appalled by Trump’s statement Friday afternoon on Syria, moved by the listening session, ticked off by the behavior at the CNN confab, and bemused by CPAC because that was the stupidest hour+ long speech I’ve ever heard.

The story this week wasn’t Parkland and its aftermath, however, but the ongoing carnage and pure barbarism on the part of the Bashar Assad regime in Syria, together with its Russian ally, in the Damascus suburb of Eastern Ghouta.

But I told you back in 2012 it was over in Syria; Bin Laden is dead, General Motors is alive...that is all we heard.  I have long proved that Barack Obama will pay a severe price in the history books for his inaction at that time...for his failure to join Turkish President Erdogan in the establishment of a no-fly zone that would have largely stopped the Syrian war cold when the death toll was ‘only’ 20,000.

There would have been no ISIS, no mass migration to Europe, no Russian involvement, no 400,000 additional dead.  Iran’s future participation in the theater would have been severely limited.  Israel wouldn’t be facing the immense threat it is today and instead would be dealing with one it can handle.

For Obama, though, it was all about the election.  No Profiles in Courage for him.

So forgive me if the handwringing over some of the events in the U.S. these days doesn’t move me quite as much as perhaps I should be.  2012 is going down in history like 1938.  Neville and Barack.  I’ll long be dead when the final history is written of the consequences from decisions not made; roads not taken in 2012 will be ingrained in the psyche of people the world over the next 100 years.  It’s just that today, as was the case in 1938, people don’t understand.

Meanwhile, now we have a president who while not responsible for how it all evolved, doesn’t have a clue as to what is coming next.

Trump World

Parkland and Gun Control: A Quinnipiac University national poll shows American voters support stricter gun laws by a 66-31 margin, the highest level of support ever measured by Quinnipiac. This result is up from a negative 47-50 percent measure of support in a Dec. 23, 2015 survey.

Support for universal background checks is itself almost universal, 97-2 percent, including 97-3 among gun owners.

But in a Washington Post-ABC News poll post-Parkland, Americans are roughly split on reinstating the 10-year ban on assault weapons that expired in 2004, with 50 percent in support and 46 percent opposed, a stark contrast from the 80 percent support for the ban in 1994, the year it was enacted. The current level of support is little different from 51 percent in 2016.

Speaking Thursday with state and local officials at a White House meeting on school safety, Trump said students should be protected the way banks are and repeated his call for arming teachers to help protect students, but only highly trained people would carry weapons in school.

“I think a concealed permit for teachers, and letting people know there are people in the building with a gun, you won’t have...these shootings,” he said.

But the prospect for any real gun-control bill making it through Congress in an election year is minimal, unless the president chooses to keep it in the spotlight, which would put pressure on Republicans.

Certainly, while he ran on a gun-rights platform, proposals for strengthening background checks and limiting access to firearms by people with mental illness and banning devices such as bump stocks can get through the House, which is where the real test will be, not the Senate.

--The only armed security guard on campus during the deadly mass shooting, Scot Peterson, a sheriff’s deputy, “never went in” to the school building to try to take down the shooting suspect, Sheriff Scott Israel of Broward County shockingly announced at a news conference on Thursday.

Two other deputies were placed on restricted duty while the department investigates their handling of reports about the gunman well before last week’s rampage.

But as for Peterson, police protocol requires confronting shooting suspects as quickly as possible.  He should have “went in, addressed the killer, killed the killer,” said Sheriff Israel.

Instead, Peterson remained outside the freshman building for “upwards of four minutes” while Nikolas Cruz was inside.

Surveillance video showed Peterson was doing “nothing,” Israel said, who described himself as “devastated, sick to my stomach.”

“There are no words,” he said.

We learned today that three other deputies may not have entered the building as they should have.  Cruz may have already exited, but they should have been in there to help treat the wounded.

But almost equally outrageous was another fact learned on Thursday...that the surveillance footage from inside the high school was not shown live, but instead police were watching it on a 20-minute delay, leading them to believe the gunman, Cruz, was still in the building when he was at Walmart.  That is unbelievable.

Apparently during the immediate response to the event, the system was being viewed in real-time but then the recorded footage was being viewed to retrace the actions of the shooter and it took some time for officers to realize they were seeing it on delay.

Today, we also learned that Broward County deputies received at least 18 calls warning them about Cruz from 2008 to 2017, including concerns that he “planned to shoot up the school” and other threats and acts of violence prior to Parkland.

The warnings were relayed by concerned people close to Cruz. No action taken. Then the kid exploded.

Friday, Florida Republican Gov. Rick Scott announced a proposal to increase restrictions on buying guns and to strengthen school safety measures.

Scott said he would work with state lawmakers during the next two weeks to raise the minimum age for buying any kind of gun in Florida to 21, with some exceptions for younger military members and law enforcement officers.  Today, as we all now know, weapons such as the semiautomatic AR-15-style assault rifle can be bought by people as young as 18 in the state.

Scott also said he would make it “virtually impossible for anyone who has mental health issues to use a gun, and he wants to ban the sale and purchase of bump stocks, an accessory that transforms a semi-automatic rifle into a weapon able to fire hundreds of rounds a minute, as we learned with the Las Vegas shooting.

I agree with all the above.  Just do it.  It’s a good start.

John Podhoretz / New York Post

“Some facts. There are 126 million households in the United States. In 35 percent of those households – some 44 million – there is a gun. There is an average of 2.8 people per household, according to the Census Bureau. This means that something like 120 million people in this country live with at least one gun in their homes.

“In 2013, 107,000 crimes in the United States were committed with a gun. There are 330 million people in the United States. If we assume every one of those crimes was the work of a different individual, then .03 percent of all those who live with a gun in the United States used that gun in the commission of a crime.

“That’s not 3 percent. That’s not one-third of a percent. That’s three-hundredths of a percent.

There are approximately 120,000 schools in the United States. If we use the term ‘school shooting’ in the most capacious way, there have been 145 incidents since 2010.That means .12 percent of all schools in the United States have suffered the horror of a school shooting.

“If you are the sort of person who believes guns are evil objects no one should want to possess, or that semi-automatic weapons are especially monstrous devices no one should be allowed to own, these numbers won’t matter all that much to you, or at all.  In your mind, the very fact that guns are used in crimes, especially in mass shootings, invalidates any arguments on their behalf.

“Now, you might be stirred to appreciate the challenges to a family in a rural area 25 or 50 miles from the nearest police station who could not rely on the local constabulary to protect them from a marauder.

“And you might appreciate that people under direct threat – someone under a fatwa, say, or a celebrity with a violent stalker – might need special protection from a private bodyguard carrying a weapon.

“But you are almost certain to ask, ‘Why does anyone need these things when they can do such harm?’  You scoff at the tired line that guns don’t kill people; people kill people. You have likely assigned moral meaning to the ownership of a gun. And you have judged those who own one to be suffering from a moral flaw, and those who own many to be fetishistic monsters.

“Here’s the thing, my gun-restricting friends (and I have many). Those 35 percent of American households are geographically distributed in such a way that you’ll never secure your objective if you cannot engage the people who own guns in a conversation that begins with the proposition that you are better than they are.

“Because they don’t think you are better than they are. They think they are just fine....

“What you have to understand is that while you believe you have all the moral force on your side, you cannot make a gun owner believe that he is the Parkland shooter. Because he isn’t. And let’s face it – somewhere, deep in your heart, you think he is.

“So if you genuinely want to alter the trajectory of America’s gun culture, stop thinking of yourself as a moral paragon and the people whose rights you are seeking to curtail as potential mass murderers and start thinking of them as fellow citizens you have to convince.”

Trumpets....

--Special counsel Robert Mueller unsealed new charges on Thursday against President Trump’s former campaign chairman, Paul Manafort, accusing him of hiding income and defrauding banks, with similar new charges against Manafort’s longtime business associate and campaign deputy, Rick Gates, who was indicted along with Manafort back in October.

The original indictment did not explicitly bring tax charges, so it was thought Mueller would eventually correct this.

The charges do not involve Trump or his campaign and predate either man’s involvement with the president.

But there seems to be no doubt Mueller is further pressuring Manafort and Gates in an effort to get them to provide information about Trump and the campaign, and this afternoon, Gates pleaded guilty to two charges, making him the fifth person to publicly admit to criminal misconduct in Mueller’s probe.  Gates faces roughly 4 ½ to 6 years in prison, though he could receive credit for the level of cooperation he provides prosecutors.

Manafort issued a statement saying he would continue to defend himself “against the untrue piled up charges” against him.  “I had hoped and expected my business colleague would have had the strength to continue the battle to prove our innocence. For reasons yet to surface he chose to do otherwise.”

Now it’s about what Gates really has on Manafort.

--Tweets: “If it was the GOAL of Russia to create discord, disruption and chaos within the U.S. then, with all of the Committee Hearings, Investigations and Party hatred, they have succeeded beyond their wildest dreams. They are laughing their asses off in Moscow. Get smart America!”

“Now that Adam Schiff is starting to blame President Obama for Russian meddling in the election, he is probably doing so as yet another excuse that the Democrats, lead by their fearless leader, Crooked Hillary Clinton, lost the 2016 election. But wasn’t I a great candidate?”

“I never said Russia did not meddle in the election, I said ‘it may be Russia, or China or another country or group, or it may be a 400 pound genius sitting in bed and playing with his computer.’ The Russian ‘hoax’ was that the Trump campaign colluded with Russia – it never did!”

“Finally, Liddle’ Adam Schiff, the leakin’ monster of no control, is now blaming the Obama Administration for Russian meddling in the 2016 Election. He is finally right about something.  Obama was President, knew of the threat, and did nothing. Thank you Adam!”

“Never gotten over the fact that Obama was able to send $1.7 Billion Dollars in CASH to Iran and nobody in Congress, the FBI or Justice called for an investigation!”

“General McMaster forgot to say that the results of the 2016 election were not impacted or changed by the Russians and that the only Collusion was between Russia and Crooked H, the DNC and the Dems.  Remember the Dirty Dossier, uranium, Speeches, Emails and the Podesta Company!”

“Question: If all of the Russian meddling took place during the Obama Administration, right up to January 20th, why aren’t they the subject of the investigation? Why didn’t Obama do something about the meddling? Why aren’t Dem crimes under investigation? Ask Jeff Sessions!”

“I have been much tougher on Russia than Obama, just look at the facts. Total Fake News!”

“Very sad that the FBI missed all of the many signals sent out by the Florida school shooter. This is not acceptable. They are spending too much time trying to prove Russian collusion with the Trump campaign – there is no collusion. Get back to the basics and make us all proud!”

“I never said ‘give teachers guns’ like was stated on Fake News @CNN & @NBC. What I said was to look at the possibility of giving ‘concealed guns to gun adept teachers with military or special training experience – only the best. 20% of teachers, a lot, would now be able to”

“...immediately fire back if a savage sicko came to a school with bad intentions. Highly trained teachers would also serve as a deterrent to the cowards that do this. Far more assets at much less cost than guards. A ‘gun free’ school is a magnet for bad people,  ATTACKS WOULD END!”

“...History shows that a school shooting lasts, on average, 3 minutes. It takes police & first responders approximately 5 to 8 minutes to get to site of crime. Highly trained, gun adept, teachers/coaches would solve the problem instantly, before police arrive. GREAT DETERRENT!”

“Just watched a very insecure Oprah Winfrey, who at one point I knew very well, interview a panel of people on 60 Minutes. The questions were biased and slanted, the facts incorrect. Hope Oprah runs so she can be exposed and defeated just like all of the others!”

--Opinion....including on last Friday’s federal grand jury indictment of 13 Russian nationals and their attempt to sway the 2016 election.

Dan Henninger / Wall Street Journal (he’s shortened his name from Daniel, I see)

“Two possibilities for comment present themselves this week.  One is what Robert Mueller’s exposure of a Russian network of provocateurs operating in the U.S. since March 2014 says about the Trump-Russia collusion narrative. The other is the FBI’s failure to act on a substantial tip about the disturbed and ultimately homicidal Nikolas Cruz, who as promised went on a high-school killing spree.

“There is no reason for anyone to comment on the credibility of the collusion narrative because the president himself is covering that from his Twitter account. On Saturday he suggested that events like the Parkland killing happen because the FBI is ‘spending too much time trying to prove Russian collusion with the Trump campaign.’

“With that conflation, Mr. Trump’s bunker-busting tweets hit a new bottom of personal reprehensibility. But since Mr. Trump is taking care of the person he calls ‘Trump’ in the Mueller showdown, we’ll turn to the problem that affects everyone else: a federal agency failure that contributed to 17 deaths in Florida.

“This wasn’t the first time. Or the second, or the third. The number of catastrophic events attributable in no small part to federal-agency failure in recent years is staggering.

“Missed signals at some level of the federal government or other public agencies preceded mass shootings at Sutherland Springs, Texas (25 killed), Charleston (nine people); the Orlando nightclub (49); Fort Hood (13); San Bernardino (14) and the Boston Marathon bombing (three dead and multiple severed limbs).

“The error list goes on: Amtrak’s derailments, the National Security Agency letting Edward Snowden walk away with the crown jewels on a thumb drive, or the deadly Veterans Administration.

“Why do these public-agency mistakes continue to happen? The reasons are complex, (but) the simple answer is that the federal government has become too big to succeed. Its vastness ensures mistakes, and its public-safety responsibilities ensure that some of those mistakes will be fatal.

“Two pained words emerge from the ashes of every such event: ‘Do something.’

“Nearly every function government performs is at some level a response to ‘Do something.’  A bad event happens, and the political default is to add another layer to what  we expect government to do.

“The 9/11 Commission was a positive response to ‘Do something.’ It exposed the resistance of the FBI, CIA and State Department to sharing intelligence. But Russian spies running wild in the U.S. from 2014 through 2017 suggests the silos have re-formed, or the agencies have too many distractions....

“Federal bureaucracies no longer own the problem of producing unintended catastrophe on a grand scale. Facebook, Google and Twitter are magnificent machines, like the web itself. But the always-on web has liberated the world’s previously closeted fanatics and helped turn borderline psychotics and terrorists into up-and-running threats.

“Facebook has 2.2 billion users. The FBI agent who thought Nikolas Cruz’s homicidal YouTube comment was unexceptional had a point. The idea that social-media companies should police their users is roughly the equivalent of asking them to monitor all of human behavior. For that experiment, we have China’s control-meister Xi Jinping.

“Whether these companies should be broken up is beyond the scope of this column. It’s pertinent to ask, though, whether the federal government’s inexorable bloat has made it a clear and present danger to the American people. That’s a question for public safety. It’s also a question for our politics.”

Thomas L. Friedman / New York Times

“Our democracy is in serious danger.

“President Trump is either totally compromised by the Russians or is a towering fool, or both, but either way he has shown himself unwilling or unable to defend America against a Russian campaign to divide and undermine our democracy.

“That is, either Trump’s real estate empire has taken large amounts of money from shady oligarchs linked to the Kremlin – so much that they literally own him; or rumors are true that he engaged in sexual misbehavior while he was in Moscow running the Miss Universe contest, which Russian intelligence has on tape and he doesn’t want released; or Trump actually believes Russian President Vladimir Putin when he says he is innocent of intervening in our elections – over the explicit findings of Trump’s own CIA, NSA and FBI chiefs.

“In sum, Trump is either hiding something so threatening to himself, or he’s criminally incompetent to be commander in chief. It is impossible yet to say which explanation for his behavior is true, but it seems highly likely that one of these scenarios explains Trump’s refusal to respond to Russia’s direct attack on our system – a quiescence that is simply unprecedented for any U.S. president in history.  Russia is not our friend.  It has acted in a hostile manner.  And Trump keeps ignoring it all....

“Donald, if you are so innocent, who do you go to such extraordinary lengths to try to shut Mueller down? And if you are really the president – not still head of the Trump Organization, who moonlights as president, which is how you so often behave – why don’t you actually lead – lead not only a proper cyberdefense of our elections, but also an offense against Putin....

“My guess is what Trump is hiding has to do with money. It’s something about his financial ties to business elites tied to the Kremlin. They may own a big stake in him. Who can forget that quote from his son Donald Trump Jr. from back in 2008: ‘Russians make up a pretty disproportionate cross section of a lot of our assets.’  They may own our president.”

Scott Shane / New York Times

“The CIA helped overthrow elected leaders in Iran and Guatemala in the 1950s and backed violent coups in several other countries in the 1960s. It plotted assassinations and supported brutal anti-Communist governments in Latin America, Africa and Asia. ...It illuminates the larger currents of history that drove American electoral interventions during the Cold War and motivate Russia’s actions today. ... At least once, the hand of the United States reached boldly into a Russian election. American fears that Boris Yeltsin would be  defeated for re-election as president in 1996 by an old-fashioned Communist led to an overt and covert effort to help him, urged on by President Clinton. It included an American push for a $10 billion International Monetary Fund loan to Russia four months before the voting and a team of American political consultants (though some Russians scoffed when they took credit for the Yeltsin win). ...In recent decades, the most visible American presence in foreign politics has been taxpayer-funded groups (that) do not support candidates but teach basic campaign skills, build democratic institutions, and train election monitors.  Most Americans view such efforts as benign. ...But Vladimir Putin sees them as hostile.”

Michael Goodwin / New York Post

“After 18 months of Russia, Russia, Russia, we finally meet a cast of real Russians. But par for the convoluted course, they were pretending to be Americans.

“The indictments obtained by special counsel Robert Mueller on Vladimir Putin’s attempts to create discord in the 2016 election and eventually support Donald Trump are important both for what they say and what they don’t say.

“They offer huge victories for Trump – and thus more defeats for Hillary Clinton – but they don’t close the books on everything about 2016.

“The very good news for the president is that the indictments are firm in saying that any Americans contacted by the 13 charged Russians, including Trump campaign associates, did not know they were dealing with Russians.

“The indictments also state forcefully that despite their social media efforts, which ranged from creative to clumsy, the Russians had no impact on the election results.

“Deputy Attorney General Rod Rosenstein announced those findings in a flat monotone that belied their significance.

“ ‘There is no allegation in this indictment that any American was a knowing participant in this illegal activity,’ he said.  ‘There is no allegation in the indictment that the charged conduct altered the outcome of the 2016 election.’

“Those are dramatic statements by any measure.

“Rosenstein’s statements should end Clinton’s disgraceful claim that Trump stole the election.

“She lost the old-fashioned way – by being a terrible candidate. Case closed, though I’m sure Clinton and her legion of dead-enders will find excuses to keep alive her campaign of victimhood.

“Yet the indictments are hardly the final word, and the charges leave plenty of daylight for continued speculation on two fronts.

“One is whether Trump or his associates conspired with top Russian government officials, as opposed to the low-level units carrying out the disruption scheme. So far, there is no public evidence of any connection except the discredited Steele dossier that Clinton paid for, but Rosenstein emphasized the limits of the case at hand by using the phrase ‘in the indictment.’

“By the same token, the charges do not deal with whether Trump obstructed justice by firing FBI Director James Comey.

“Presumably, those two issues are what’s left on Mueller’s plate, meaning America’s political nightmare continues.”

Editorial / Washington Post

(The indictment) undercuts any lingering suggestion that Russian interference is a myth or a hoax, and Mr. Trump, who has often suggested as much, should have acknowledged the new evidence Friday. Instead, his first reaction was to claim vindication on Twitter.

“ ‘The Trump campaign did nothing wrong,’ he wrote, adding, ‘no collusion!’ This was inappropriate on two levels.

“First, though the indictment did say that there was no knowing American collusion with the Russian social media campaign, and though it did not say that it affected  the results, it also showed that the vast majority of Russian propaganda supported Mr. Trump’s campaign and attacked that of his Democratic opponent, Hillary Clinton. You would think Mr. Trump would take a moment to repudiate that support, even in hindsight, and to declare that no foreign power has a right to campaign secretly against an American candidate.

“Second, Mr. Mueller has not finished his investigation and has not ruled out the possibility of collusion.  We don’t yet know whether Donald Trump Jr.’s eagerness to meet with Russians offering ‘dirt’ on Ms. Clinton’s campaign was an isolated incident. Nor has the special counsel yet weighed in on the question of possible obstruction of his investigation by President Trump....

“The grand jury’s indictment shows how far Russia is willing to go to manipulate and discredit our democracy.  Mr. Trump’s own intelligence chiefs warned this week that the 2018 election is under threat. Given the baffling and inexcusable absence of presidential leadership, Congress must step up to defend the nation.”

Editorial / Wall Street Journal

“The indictment’s details underscore Russia’s malicious anti-American purposes. An authoritarian regime spent tens of millions of dollars to erode public trust in American democracy.  As Senator Ben Sasse (R, Neb.) put it Friday, ‘Putin’s shadow war is aimed at undermining Americans’ trust in our institutions. We know Russia is coming back in 2018 and 2020 – we have to take the threat seriously.’

“All of which makes the White House reaction on Friday strangely muted. Its statement understandably focused on the lack of collusion evidence and made one reference to ‘the agendas of bad actors, like Russia.’  But given how much Russia’s meddling has damaged his first year in office, Mr. Trump should publicly declare his outrage at Russia on behalf of the American people. The Kremlin has weakened his Presidency. He should make Russia pay a price that Mr. Obama never did.”

Wall Street

It was another volatile week for stocks, with the Dow Jones taking a  steep dive Tuesday and Wednesday (Monday a holiday), only to recover and then some Thursday and Friday, with the action in the bond pits playing a major role both ways.

At one point the yield on the 10-year Treasury hit 2.95%, a new four-year high going back to Jan. 2014, following the release of the Federal Reserve’s minutes from its last meeting, Jan. 30-31, which showed an Open Market Committee that was comfortable with a forecast of inflation rising to its 2% target over the medium term, citing “substantial underlying economic momentum.”

Fed officials “anticipated that the rate of economic growth in 2018 would exceed their estimates of its sustainable longer-run pace and that labor market conditions would strengthen further,” as a number of participants “indicated that they had marked up their forecasts for economic growth in the near term relative to those made for the December meeting.”

“A majority of participants noted that a stronger outlook for economic growth raised the likelihood that further gradual policy firming would be appropriate,” the minutes said.

Since Fed officials last met in January, data showed wages rising faster than forecast, which helped lead to the market sell-off.

But this coming week, new Fed Chairman Jerome Powell goes before Congress for a first time in this capacity to update both the House and Senate on the economic outlook and each word will be parsed for clues as to whether the Fed will be hiking rates three or four times this year.

The yield on the 10-year finished the week at 2.87%, same as last Friday.

In the only major economic item of note this week (at least that I care about), January existing home sales came in far less than expected, a 5.38 million annualized clip, down 3.2%, with the median home price falling 2.4% to $240,500, though year-on-year this is still up a solid 5.8%, the 71st consecutive month of gains from year ago levels.

Europe and Asia

Markit released its flash readings on the eurozone (EA19) economy for February, with the composite at 57.5 vs. 58.8 in January (50 being the dividing line between growth and recession); services at 56.7 vs. 58.0, manufacturing 58.5 vs. 59.6.

Germany had a manufacturing flash reading of 60.3 vs. 61.1, a 6-month low, while services are projected at 55.3 vs. 57.3, a 3-month low.

France had a flash manufacturing figure of 56.1 vs. 58.4, a 4-month low, while services were at 57.9 vs. 59.2, also a 4-month low.

But all of the numbers are way above the key 50-line, and as Chris Williamson, Chief Economist at IHS Markit, put it:

“February saw the eurozone’s growth spurt lose a little momentum, but the rate of expansion remains impressive, putting the region on course for its best quarter for almost 12 years.

“The PMI readings for the first two months of the quarter generally provide a reliable guide to official GDP growth, and indicate that the eurozone economy is expanding at a quarterly rate of 0.9% in the opening quarter of 2018.

“The service sector is enjoying its best growth spell for seven years and the manufacturing sector’s performance remains one of the strongest seen over the 20-year survey history....

“Price pressures meanwhile remained elevated, in part because stronger demand has enabled more firms to raise their selling prices. However, some comfort can be gleaned from a slight easing in the overall rate of inflation compared to January’s recent high.”

So speaking of inflation, Friday, Eurostats released the figures for January in the eurozone and it was just 1.3% annualized vs. 1.4% in December and 1.8% in January 2017.  So there remains zero pressure on the European Central Bank to begin to change its zero interest rate policy, even as it reduces its bond-buying program.

In Germany inflation is running at 1.4%, France 1.5%, Spain 0.7%, Italy 1.2%, and Greece 0.2%, while it remains 3.0% in the U.K.

Bond yields had risen a bit early in the week on growing speculation that ECB head Mario Draghi’s successor next year will advocate erring on the side of tighter policy, but then they fell back at weeks’ end.

Brexit: Prime Minister Theresa May brought her ministers out to the official residence at Chequers for the purpose of coming up with a united position on Brexit, and after eight hours, it seems they more or less reached agreement that the U.K. will stick to EU rules, but on its own terms, what ministers called “Canada plus plus plus.”

The meeting was needed to break a deadlock in the government and reconcile ministers who advocate different approaches to the future relationship with the EU.

But Brussels has grown impatient with the lack of a clear U.K. position, and deadlines are looming in terms of settling the terms for the transition and the start of trade talks.

Mrs. May wants to stick to EU rules in certain areas, partially abiding in others, and ditching them completely in the rest; what is being called the “three baskets” approach.

But the EU has long said Britain can’t “cherry-pick” its way through Brexit and the European Commission pre-empted the Chequers meeting by ruling out the emerging strategy.

The Commission said in a presentation published on its website:

“U.K. views on regulatory issues in the future relationship including ‘three basket approach’ are not compatible with the principles in the European Council guidelines,” one of the slides reads. If the U.K. “aspires to cherry pick,” there’s a “risk for the integrity” of the single market, it says.

Trade talks are set to begin next month, but the U.K. and EU need to move closer together on their positions soon.  And one issue that is still far from being settled is that of the Irish border.

The thing is, Prime Minister May’s Conservative party is more divided than her cabinet, and there is still a solid chance she is booted out.  Leaders such as Foreign Secretary Boris Johnson, who has long had designs on being prime minister, fear that May will allow the European Court of Justice to keep a role overseeing regulation affecting the U.K. long after Brexit, in return for a palatable trade deal that could tie the country too closely to the EU’s single market, which they would see as a betrayal of the 2016 vote to leave the bloc.

Hard-line advocates of Brexit have argued that Britain should take back control of its laws and judicial system and no longer be beholden to the rulings of the European court.

It’s another red line that Mrs. May has crossed in her dealings with European negotiators, from a divorce settlement of about $55 billion to a transition period in which Britain will keep to EU rules even after it legally quits the bloc.

European Council President Donald Tusk is to meet with May next Thursday, a day before the prime minister is to deliver a speech to outline Britain’s vision of post-Brexit ties with the EU.

But late Friday, following a summit in Brussels, Donald Tusk said Britain’s vision for Brexit is not based on reality, delivering a harsh blow to Mrs. May.

“I’m afraid that the U.K. position today is based on pure illusion,” Tusk told reporters.  “It looks like the cake philosophy is still alive,” he added, referring to Foreign Secretary Boris Johnson’s much-derided claim that Britain could have cut its cake and eat it (too).

“From the very start, it has been a key principle of the EU-27 that there will be no cherry picking and no single-market a la carte,” Tusk said. “This is and will continue to be a key principle, I have no doubt.”

May and the EU must reach agreement on the transition period at a summit of leaders in Brussels in the second half of March. Whatever vision May and her team come up with, it will still have to be acceptable to the other 27.

Germany: As Chancellor Angela Merkel awaits a party vote inside the Social Democrat party (SPD) that would solidify the coalition government (the vote of party members to be revealed March 4), Merkel is facing opposition from within over her compromise with the SPD on the issue of military spending.  A key supporter of Merkel, Norbert Roettgen, blasted Foreign Minister Sigmar Gabriel, a Social Democrat, for questioning the target of 2 percent of GDP spending on defense.

The coalition agreement underscored Germany’s intention to meet its commitment to NATO, but does not explicitly mention the goal of 2 percent spending by 2024.  Roettgen, the head of the foreign affairs committee in parliament, said that if Germany didn’t increase its spending to at least 1.5% of economic output by the end of the next four-year legislative period, up from the current 1.2%, Germany’s credibility within NATO would be shot.

President Trump and other NATO allies have been pressing Germany as Europe’s biggest economy to spend more on its military, especially after the defense ministry’s announcement this week that efforts to improve the readiness of key weapons was starting to pay off; as in 57 percent of the 5,000 major weapons – aircraft, ships and ground vehicles – were available for use, up from 46 percent in March 2015.  Just 57 percent?  Officials say it will take 10 years to reverse erosion caused by years of declining military spending.

Roettgen said: “If we do not reliably stand by commitments we made to NATO, we will lose standing and influence in Washington, and even Moscow won’t take us seriously.”

This is the kind of problem you have in a coalition comprised of conservatives and socialists, boys and girls.

One more...Merkel tabbed a party loyalist who has been floated as a possible successor, Annegret Kramp-Karrenbauer, 55, to the post of general secretary of her Christian Democratic Union.

Eurobits....

--The big election in Italy is next Sunday, March 4, and a three-way coalition featuring Metteo Salvini, head of the anti-migrant League (Northern League); as well as a small party descended from Italy’s wartime fascist party; and Forza Italia, led by ex-Prime Minister Silvio Berlusconi, who is campaigning on a promise to eject 600,000 illegal migrants – appears close to gaining 40% of the vote, which it would then win.

The right-wing trio is benefiting from rising intolerance toward migrants after the arrival of 600,000 by sea, mainly Africans departing from Libya, over the last four years. While many have moved on to other countries, 200,000 are housed in reception centers in Italy waiting on asylum applications. The pictures of migrants in small-town centers are provoking accusations from locals that they are happy to live off Italian taxpayers.

The anti-immigrant fervor has been growing.  Should the above coalition win, under Italy’s complicated system for allocating seats, they would most likely have enough for a parliamentary majority. 

--Speaking of immigration, French President Emmanuel Macron is putting the unity of his parliamentary majority to a test with legislation that will tighten controls over immigration, including speeding up deportations and tightening the classifications for asylum.  The bill is scheduled to be debated in parliament in April.  Migrants associations and human rights organizations expressed their disapproval.

A BVA poll this month showed 63% say there are too many migrants in France.

Meanwhile, Macron’s overall approval rating fell to 44% in an Ifop poll, down 6 points from its previous survey in January.  Government plans to modernize the public administration (government bureaucracy) in a country with one of the highest public spending ratios in the world is needless to say largely unpopular.

--Latvia signaled Russia may be inflaming the crisis engulfing the Baltic nation’s banking industry.

“There is a high probability that an externally organized widespread information operation is being carried out that, by its structure and execution, is identical to those observed in pre-election periods in the U.S., France and Germany,” Latvia’s Defense Ministry said on Tuesday.

Latvia, a regional banking hub, has long faced questions over its enforcement of money-laundering rules.  Last weekend, Central Bank Governor Ilmars Rimsevics was detained as part of a bribery probe. He has been leading the central bank since 2001, making him the longest-serving head of a national bank on the ECB’s Governing Council, which he joined in 2014 after Latvia adopted the euro.

Rimsevics was then released on bail and has denied seeking bribes and accused lenders of conspiring against him.

Today, the central bank provided an emergency load to troubled lender ABLV, offering it a potential lifeline as an ECB deadline approaches for the bank to present a credible survival plan.

ABLV, the nation’s third-largest lender, has been shut since the beginning of the week after the U.S. accused it of engaging in large-scale money laundering for Russian clients.

But then as I go to post, I see that Saturday, euro time, the ECB said ABLV can’t be saved.  It seems their Resolution Board overruled Latvia’s central bank.

Turning to Asia....

In a bold, rare move, China’s government is taking over Anbang Insurance Group Co., owner of New York’s Waldorf Astoria, and will prosecute founder Wu Xiaohui, cementing the downfall of a deal-maker whose aggressive global expansion came to symbolize the financial overreach of China’s debt-laden conglomerates.

[Bloomberg Economics projects that total borrowing, much of it by state-owned enterprises, will exceed 325 percent of GDP by 2022 from 260 percent in 2016.]

Regulators announced they would take over Anbang for a year, remove Wu and charge him with “economic crimes.” Wu, who was the company’s chairman, was detained by authorities in June.

But under Wu, Anbang snapped up trophy assets around the world – sometimes at prices that left observers scratching their heads.

Wu’s links to the Chinese political elite became fodder for media scrutiny with each high-profile acquisition.

So the takeover by the government confirms China’s determination to rein in soaring corporate debt that has accompanied China’s growth.  It also demonstrates that short-term pain economically will be tolerated for the longer-term goal of more sustainable expansion.

But it’s also about reminding not just corporate China, but also multinationals, that when you do business with China, it’s about the Communist Party.

And in the case of the Waldorf Astoria, Hilton Worldwide Holdings, which manages the hotel on behalf of Anbang, is now working for the Chinese government. Isn’t that special?

I have much more on the topic below.

Meanwhile, there was some economic data from Japan, with the flash PMI on manufacturing for February coming in at a solid 54.0 vs. 54.8 in January.

Separately, exports for January rose 12.2% year-on-year, according to the Ministry of Finance, vs. December’s 9.3% clip, while imports rose 7.9%.

Exports to China surged 30.8% yoy, and were up 16% to Asia overall. Exports to the U.S. rose just 1.2%, as car shipments fell 3.9%.

Street Bytes

--For the week, the Dow Jones gained 0.4% on the heels of Friday’s 347-point, 1.4% gain, while the S&P 500 was up 0.6% and Nasdaq 1.4%; the latter two up 1.6% and 1.8% today, respectively. So for the year, the three major indices are solidly in the black again (see below).

--U.S. Treasury Yields

6-mo. 1.84%  2-yr. 2.24%  10-yr. 2.87%  30-yr. 3.16%

The yield on the 2-year is at its highest level since Sept. 2008.

--This week, shares in Amazon hit $1,500 for the first time on Wednesday, after climbing 56% last year, and closed at exactly that level on Friday, up another 28% in the first two months of 2018.

--Shares in Walmart Stores Inc. tanked on Tuesday after the company reported fiscal fourth-quarter profit of $2.17 billion, with adjusted earnings per share coming in four cents light of expectations.

The world’s largest retailer posted revenue of $136.27 billion, up 2.6% for the quarter ended Jan. 31, exceeding the Street, but the company expects full-year earnings to be $4.75 to $5 per share, which is less than analysts’ forecasts.  [Same-store sales also rose 2.6%.]

The biggest reason for the shares tanking 10%, its worst one-day slide since 1988, though, was the realization that the company’s efforts to compete with Amazon online were contributing to a record-low operating margin as Walmart cut prices. What analysts now see is diminished returns from the initiative, with online sales growing less than half the pace last quarter as in the previous three months; 23% vs. more than 50% growth for the previous three quarters, in actuality.

It didn’t help that Walmart misjudged inventory, with goods like TVs and toys flooding their e-commerce warehouses, thus squeezing out room for staples such as toilet paper that it then ran out of, leaving its customers just sitting there, frantically looking for alternatives.  [A problem compounded by the fact people don’t buy magazines like they used to.]

Amazon, according to Bain & Co., continues to increase its market share, capturing half of online spending growth during the holidays. For Walmart, however, as it tries to figure out its online strategy to reach more Amazon loyalists, the expenses are piling up, with the company admitting profits will be squeezed.

The company also said it would no longer offer quarterly profit projections.

--Home Depot reported earnings that were in line with the Street, with revenue of $23.88 billion, up from $22.21 billion, and above forecasts.

Online sales grew 21% in the quarter, but unlike with Walmart, e-commerce hasn’t been a big part of the Home Depot story and the shares were flat while Walmart’s stock swooned.

HD is now forecasting sales growth of 5% at its existing stores in 2018, which is slightly below Wall Street’s forecasts, but still a banner year, compared with most retailers, including Walmart’s 2% growth rate. Home Depot is also forecasting full-year earnings of about $9.30, in line with consensus.

--Toys “R” Us Inc. plans to close another 200 stores and lay off a significant number of corporate staff, after previously announcing it was closing 180 stores, affecting 4,500 workers.  Together, this means the chain will have about half the number of locations as it had before filing for bankruptcy.

Additionally, while employees had previously been told they would receive some severance, the Wall Street Journal is reporting that managers were instructed to tell hourly workers that “there are no severance benefits being provided for the store-closing process.”  Ugh.  In January they had been told they would receive some benefits.

According to research firm AlixPartners, overall in the retail industry there were 7,000 store closures in 2017, many of which resulted from bankruptcy filings.

--Yum! Brands Inc.’s KFC warned that a supply-chain breakdown that has shut more than half of its 900 U.K. outlets would persist for the week, which is really pretty disgraceful.

KFC said it was working with new logistical partner Deutsche Post AG to solve a problem that began over the weekend, leaving only 430 of the 900 with any chicken to cook as of Tuesday. Employees were caught on camera bringing in store bought chickens in one case.  Hell, you’re trying to save your job.

The issue goes back to November when KFC overhauled its U.K. chicken supply chain by replacing logistics provider Bidvest Group Ltd. with Deutsche Post’s DHL, which isn’t necessarily known for delivering food products.

--JPMorgan Chase is going to tear down its Park Ave. headquarters and replace it with one of the tallest towers in New York City, giving a boost to the old business heart of Manhattan. The biggest bank in the U.S. has been mulling a move from its 270 Park Ave. location to the west side of Manhattan, as an anchor tenant of what is known as the Hudson Yards development, but instead it reached an agreement with the city to stay put, consolidating several buildings in the Park Ave. area into one new tower, which will be around 70 to 75 stories, making it the tallest bank building in the country, exceeding Bank of America’s 55-floor tower nearby, as well as BofA’s 60-floor headquarters in Charlotte, N.C.

--Vox Media is laying off about 50 employees, primarily social-video teams at the company’s sites including Racked, Curbed and SB Nation, which total about 5% of Vox Media’s entire staff.

As CEO Jim Bankoff wrote in a memo to employees on Wednesday, the layoffs were promopted by the realization that social-video initiatives won’t be “viable audience or revenue growth drivers” relative to other investments.

--Michael Auslin / Wall Street Journal...Auslin a fellow at the Hoover Institution, Stanford University:

“Mercedes-Benz, the luxury unit of Daimler AG, recently learned the price of crossing Beijing. Earlier this month the German car maker was attacked by state media after posting an anodyne Dalai Lama quote on Instagram. The company quickly and abjectly apologized to the Chinese government. It then went further, promising ‘no support, assistance, aid or help to anyone who intentionally subverts or attempts to subvert China’s sovereignty and territorial integrity.’

“This public humiliation has prompted many companies to ask: How much is it worth to stay in China’s markets?

“Gone are the days when China bided its time, as counseled by Deng Xiaoping. In exchange for continued access to Chinese markets, Beijing increasingly expects Western companies to engage in self-censorship, accept government control over information, and even punish their own workers for offending China.

“Few companies have been willing to stand up for themselves when singled out. In January the American hotel giant Marriott caved in to pressure and temporarily shut down its websites in China. It’s offense? An online questionnaire listed Tibet, Taiwan, Macau and Hong Kong as independent countries. After changing the website, the company’s CEO publicly stated that Marriott ‘respects and supports Chinese sovereignty and its territorial integrity.’ Delta Air Lines, Qantas, Zara and Audi are also fellow travelers in China’s geopolitical strategy.

“Perhaps most concerning, China has taken a particular interest in changing the fundamental way Western technology companies function. Facebook, banned in China since 2009, has worked on a ‘targeted censorship’ tool during its bid to re-enter the country.  Apple agreed to a partnership with a Chinese internet service company, effectively sharing user data with the government. There is no way either company would accept such demands from the U.S. government....

“China’s behavior makes it necessary for Western companies to ask whether the cost of doing business can be too high. Does the profit motive override any responsibility to defend the values of the societies from which they emerged? If only to draw the line against further demands, companies should be reflexively opposed to Beijing’s overreach. Otherwise they should expect the cost of doing business in China to continue to rise.”

Yup, as I’ve written for years, Apple shareholders, for one, are going to be so screwed.

--Separately, Chinese competitors to Apple continue to grab market share in Asia’s biggest markets, from India to Indonesia, as reported by the Journal, with buyers opting for smartphones from the likes of Xiaomi Corp. (“the Apple of China”) – along with BBK Electronics Corp.’s Oppo and Vivo.

China’s manufacturers have become increasingly proficient at knocking off Apple technology at lower prices than the iPhone X, for example, and in some cases are offering better features, such as longer-lasting batteries, that iPhones lack.

The typical smartphone in India or Indonesia sells for under $200.

Because of the $1,000 iPhone X, its revenues grew 11% last quarter in the Asia-Pacific region, even as Apple’s market share was stagnant or declining in most Asian markets.  [Newly Purnell / WSJ]

But Apple’s market share in China is supposedly about 8% today, down from 13% in 2015, according to research firm Canalys.  Apple has just a 2% share in India, and 1% in Indonesia. 

By contrast, Xiaomi is at 19% in India, up from 3% in 2015.

--Andrew Bary of Barron’s has a super piece on General Electric, albeit a depressing one, in the Feb. 19 edition, and while I won’t get into the details, of what a mess its books are, Bary sums it up succinctly.

“If GE is dumped from the Dow industrials, bulls would seize on that as a sign of a bottom. Yet a close look at GE suggests the stock isn’t cheap based on earnings, a sum-of-the-parts analysis, leverage, complexity, and business challenges.  GE’s best days may lie in the past.”  [The stock closed at $14.50 on Friday. After the close, GE, in a filing, said the Justice Department may take action against the company over its now defunct WMC Mortgage Co. unit in connection with the sale of subprime mortgages in 2006 and 2007.]

--CEO compensation at Wall Street’s five-biggest U.S. banks with significant trading and investment-banking operations – JPMorgan Chase, Bank of America, Morgan Stanley, Goldman Sachs, and Citigroup – saw their 2017 compensation increase 17% from 2016, according to SEC filings and the Wall Street Journal.

--Barclays released some startling statistics on its compensation in its annual report Thursday.  If you’re a woman working in investment banking, for example, you’re making about 50% less money than your male colleagues and your bonus is on average nearly 80% lower.

It was the first time a major Wall Street firm detailed its gender-wage gap in such vivid detail.  But more is to come from JPMorgan Chase and Goldman Sachs because under British law, major employers are now required to start reporting how they pay women compared with men.

Previously, the U.S. Department of Labor in January reported median income for women in financial jobs is 31% lower than for men, but one reason for the pay gap is few women hold senior jobs in finance; today just 19%, according to the U.S. Equal Employment Opportunity Commission.

--The Los Angeles Times’ Russ Mitchell had an extensive piece on the problems with the Tesla Model 3. To wit:

“Mark Schey of Morristown, N.J., stepped into his garage a few mornings ago eager to hop inside his shiny new car – the much desired and currently rare Tesla Model 3 electric sedan. The one with the 15-inch touchscreen on the bare-bones dash.

“He flashed his electronic key card to unlatch the door, but nothing happened. He tried the iPhone app, but that didn’t work either.

“There was no way to open the doors. There’s not even a backup metal key. Schey figured he’d need to jump the 12-volt battery needed to power the doors open from the outside.  But the hood was locked shut, too.

“It turns out there’s a wafer-thin plastic cap flush with the front bumper covering a hole the size of a silver dollar.  The Tesla technician sent to Schey’s home reached his fingers in and pulled out two thin cables. He clamped the cables to a portable battery and switched on the juice. The hood popped open. That’s how you jump-start the most high-tech, cutting-edge automobile on the market today.

“And Schey couldn’t be happier.

“ ‘The Tesla service people were great,’ he said.  ‘I see this as growing pains.’”

Too much. They are called Teslarians for a reason.

But it’s not known how pervasive quality problems are, with J.D. Power, the preeminent automobile quality research group, not having been granted access to owner’s information so that a large enough sample of Tesla models can be included in the Vehicle Dependability Study, according to a J.D. Power executive.

All the other major automakers participate in the J.D. Power quality surveys.  [Lexus, Porsche and Buick are on top of the latest rankings.]

Consumer Reports, which ranks reliability through surveys of subscribers, predicted “average” quality for the Model 3 back in October, but didn’t yet have data from Model 3 owners.

--Speaking of Consumer Reports, it issued its 2018 rankings on Thursday, and Hyundai Motor’s luxury Genesis line topped its German rivals to be named 2018’s best car brand in the U.S.

Hyundai bumped Volkswagen AG’s Audi from top billing to the No. 2 spot, with premium mainstays BMW, Toyota Motor Corp.’s Lexus and VW’s Porsche rounding out the top five.

The timing is great for Genesis, which has only two models, as it just sponsored the PGA Tour’s Genesis Open at Riviera, so now you have a lot of folks going, ‘Oh, that’s Genesis,’ and that won’t hurt.

At No. 8, Tesla remained the highest-rated American auto brand, but it doesn’t make the best electric car. That honor went to General Motor Co.’s all-electric Chevy Bolt, which won in the new Compact Green Car category.

CR’s Top Picks List:

Large Car: Chevy Impala.

Compact Car: Toyota Corolla.

Compact Green Car: Chevy Bolt.

Compact SUV: Subaru Forester.

Mid-Sized Car: Toyota Camry.

Full-Sized Pickup: Ford F-150.

Luxury Compact Car: Audi A4.

Luxury Compact SUV: BMW X3.

--An agreement was reached with TK Holdings, Inc., the American subsidiary of Takata, the Japanese company that manufactured faulty air bags, and 44 state governments and the District on Thursday, requiring a $650 million payout by Takata.  Nearly 34 million of the 250 million vehicles on U.S. roads have been part of the largest recall in U.S. history.

--Shares in Snap plummeted back toward their IPO price of $17 after a tweet from reality TV star Kylie Jenner.

Jenner, who boasts a huge fan following, tweeted to her 24.5m Twitter followers: “sooo does anyone else not open Snapchat anymore? Or is it just me...ugh this is so sad.”

Jenner then tried to walk back her initial tweet with a follow-up saying: “still love you tho snap...my first love.”

But Jenner had previously signaled her ambivalence for the app’s redesign, which it first announced in November and recently rolled out.  [The shares ended the week at $17.50, down $3 on the week.]

--A South Korean official who guided Seoul’s regulatory clampdown on bitcoin was found dead last weekend, according to a government spokesman.  The victim, 52, is presumed to have suffered a heart attack, though police were investigating.  Jung Ki-joon had been under heavy pressure in recent months as South Korea looked to tackle cryptocurrency speculation, Yonhap reported.

--I forgot to note last time that former Wynn Resorts CEO and founder, Steve Wynn, is being denied severance, his employment contract having included a $330 million severance stipulation, according to a shareholder lawsuit filed this month.

But the company is providing him with an administrative assistant until the end of May.  Bet that person is terrified.

--The movie “Black Panther,” featuring a primarily black cast, had an opening weekend in the U.S. and Canada of $235 million, a phenomenal success and the first such movie to open to more than $100 million.

The opening was the fifth highest of all time, behind only the last two “Star Wars” sequels, “Jurassic World” and “The Avengers.”

Overseas, the Disney / Marvell Studios picture grossed another $169 million, making it the 25th-highest foreign debut of all time, and this without the Chinese and Japanese markets.

By the way, the previous record-holder for a film featuring a largely black cast, “Straight Outta Compton,” grossed $214 million worldwide in 2015 – over its entire run – after adjusting for inflation.

--Thanks to a relentless news cycle, and a big fan in the Oval Office, Fox News is planning on launching a stand-alone subscription streaming service available without a cable package, which is expected to start by the end of the year. This is Fox’ attempt to keep viewers with the network as they move away from traditional cable and satellite packages at an accelerating pace.

The streaming service will focus primarily on right-leaning commentary, with original shows and cameos by popular personalities like Sean Hannity.

Since Fox by contractual agreements with cable operators cannot have reruns on the streaming service, the network will need to develop hours of new daily programming with a mostly fresh slate of anchors and commentators.

So whereas when I was a kid, I would go to bed with my transistor radio tuned into a New York Knicks game from the west coast, you’ll be able to have Fox running all night in your ear, through your pillow!  Is this a great world or what?

--Margaret Brennan, the senior foreign affairs correspondent for CBS News, will be the next moderator of “Face the Nation.” It had been rumored CBS desperately wanted to tab a woman for the primo gig, and Brennan, 37, is now the only woman currently serving as a solo anchor of a major Sunday political affairs show.  She succeeds John Dickerson, who left after less than three years to replace Charlie Rose on “CBS This Morning.”

Lesley Stahl moderated “Face the Nation” from 1983 to 1991. Christiane Amanpour moderated ABC’s “This Week” from 2010 to 2011.

Martha Raddatz of ABC News was named a co-anchor of “This Week” in 2016, but the program’s branding remains focused on the lead host, George Stephanopoulos.

Brennan, who previously worked at Bloomberg Television and CNBC, before joining CBS News in 2012, said she hoped to offer a dose of civility in a highly charged political moment.  Her business background doesn’t hurt.  You go, Girl!

--ABC News’ flagship “World News Tonight with David Muir” has overtaken “NBC Nightly News with Lester Holt,” for overall audience, while closing the gap in the all-important 25-to-54-year-old demographic, which according to the New York Post has NBC brass beginning to sweat. What’s worse, Brian Williams is surging at his new gig at MSNBC.

Should NBC feel the need to dump Holt, if ratings continued to decline to the terminal stage, it’s too late to move Savannah Guthrie into the slot because she is a huge hit with Hoda Kotb on “Today.” And no way Megyn Kelly would get the gig.

Foreign Affairs

Syria: In a week that has seen devastation and bloodshed on a level as bad as at any time in the Syrian war, more than 400 civilians have been killed since Sunday in unrelenting bombing by Syrian and Russian aircraft in the rebel-held enclave of Eastern Ghouta, a suburb of Damascus.

Friday, Turkey called on Russia and Iran to “stop” the bombardment.  “Russia and Iran must stop the regime,” Turkish Foreign Minister Mevlut Cavusoglu said.

As part of the peace process, using the term loosely, Turkey, Iran and Russia sought to create de-escalation zones across the country, including one for Eastern Ghouta and the rebel-held Idlib province, but Cavusoglu said the regime’s offensive in the enclave as well as in Idlib was “contrary” to the agreements negotiated by the three countries.

German Chancellor Angela Merkel said Friday: “The killing of children, the destruction of hospitals – all that amounts to a massacre that must be condemned and which must be countered with a clear no.”

Among the at least 462 people that have been killed since the intensified bombardment of the besieged area on Feb. 18 are 99 children, according to the Syrian Observatory for Human Rights.  More than 2,000 wounded.

The bombing continued Friday, mostly artillery due to rainy weather.

The UN Security Council was to vote on a resolution, drafted by Sweden and Kuwait, calling for a 30-day ceasefire, the delivery of aid, and the evacuation of the wounded today, but the vote was delayed until noon Saturday by Russia.

All eyes were on Russia to see if it would resort to its veto to block the draft resolution.  A resolution needs nine votes in favor and no vetoes by Russia, China, the U.S., Britain or France. Russia has cast 11 vetoes on possible Security Council action on Syria since its civil war began in 2011.

Thursday, the Kremlin said Russia was not responsible for the civilian deaths in Eastern Ghouta and said it was working with the regime to fight terrorism.

“Those who support the terrorists are responsible,” said Dmitry Peskov,  Putin’s chief spokesman. “Neither Russia, nor Syria, nor Iran are in that category of states as they are waging an absolute war against terrorists in Syria.”

Iran’s deputy foreign minister told the BBC, the situation in Syria is “very complicated.”

“Fear of war is everywhere in our region.”

Abbas Araqchi said Iran’s presence was not aimed at creating a new front against Israel, but to fight terrorism.  He refused to confirm that Iran had sent a drone into Israeli airspace from Syria earlier this month.

A statement from the White House said the U.S. “strongly condemns recent attacks on the people of Eastern Ghouta by Russia and the Assad regime.”

Friday, in a brief press conference, Trump, when asked about the bombing, responded: “I will say what Russia and what Iran and what Syria have done recently is a humanitarian disgrace.”

But then he said the U.S. is in Syria to get rid of ISIS and once that is accomplished, we are out of there.

Separately, Turkey said it would lay siege to Afrin in northern Syria, a month after Ankara launched an offensive against Kurdish militia in the region. The Syrian Observatory says at least 94 civilians have been killed in the Turkish offensive.

Turkey was able to convince Russia, who in turn convinced Syria, not to come to the aid of the Kurds, as was being reported, Turkey saying it would confront the Syrians if this were the case.

Russian Foreign Minister Sergei Lavrov warned the Trump administration not to “play with fire” when it came to U.S. support for the autonomy-seeking Kurds in Syria.

Editorial / Wall Street Journal

“As the carnage in Syria continues, the United Nations is rousing its feeble outrage. But that is no match for Vladimir Putin’s determination to protect his client Bashar Assad.

“The Security Council met Thursday to debate a Swedish and Kuwaiti proposal for a 30-day Syrian ceasefire to stop Assad forces that are pounding rebel strongholds in Eastern Ghouta with an extermination-level bombing campaign. The UN resolution would allow the delivery of humanitarian aid and medical evacuations for the grievously injured, who include women and children....

“One of Assad’s favorite tactics is to bomb hospitals and clinics to inflict as many casualties as possible on local civilian populations.  Medecins San Frontiers reported Wednesday that 13 medical facilities had been hit or damaged since Sunday, ‘preventing medics from obtaining essential life-saving supplies.’....

“Mark this latest fiasco as another case study in what Barack Obama liked to call ‘collective security,’ which at the UN typically means no security at all.”

Raf Sanchez / Daily Telegraph

“The crowd gathered at a makeshift cemetery in Douma, a neighborhood of eastern Ghouta, to say a few brief prayers and bury seven people killed in a bomb blast that morning.

“The mourners separated the corpses – three children, three teenage boys, and one elderly man – with cinder blocks and laid wooden slabs across the blocks to create a new tier for the next set of bodies to come.

“As they began laying the bodies into the earth a jet streaked overhead and fired a rocket into the crowd. Friends and family leapt into the open grave for safety, but when the smoke cleared they counted 11 of their number who had been killed.

“What started as seven deaths had suddenly become 18.”

As the locals say, Assad’s pilots and artillery crews work diligent shifts, beginning their bombardment at around 6 a.m. and silence their guns at midnight, giving the 400,000 trapped residents six hours respite.

Editorial / Wall Street Journal (a separate one)

“Bashar Assad’s Syrian military committed more atrocities this week. ...As everyone deplores the killings, the point to keep in mind is that the driving political power here is Iran and its attempt to make Syria part of its growing Shiite-Persian empire.

“Iran has propped up Assad since the Syrian civil war erupted in 2011, and along with Russia is largely responsible for the regime’s survival.  After its 2016 victory in Aleppo and the ouster of Islamic State from Raqqa, this axis is now trying to roll up the last opposition strongholds.  The trio will then use Russia-sponsored peace talks to re-establish Assad’s control over Syria. Russia will keep its military bases, and Iran wants to establish a new imperial outpost on the border with Israel.

“Toward that end, Iran is building a robust military presence of Islamic Revolutionary Guard Corps (IRGC) troops, Iran-backed Lebanese Hezbollah, foreign fighters from Pakistan, Iraq and Afghanistan, and local Syrian militias in Assad-controlled areas. Iran’s ultimate goal is “the eradication of Israel,” as the leader of the IRGC’s Quds Force, Qasem Soleimani, said recently.

“Military analysts estimate Hezbollah could have more than 100,000 rockets pointed at Israel from its home base in Lebanon and possibly from Syria too. An Iranian redoubt in Syria would open another front in a war with Israel from which to launch more rocket and other attacks.  U.S. National Security Adviser H.R. McMaster worried publicly in December about ‘the prospect of Iran having a proxy army on the borders of Israel.’....

“(Iran) is turning its attention from propping up Assad and toward establishing a more permanent presence in Syria, including the construction of military bases and weapons factories. Iranians are investing in Syria’s local economy to help Assad ‘rebuild,’ and working to convert local Alawites to Shiite Islam.

“Iran is also exploiting a ‘cease-fire’ in southwestern Syria that the U.S. negotiated with Russia last year. Russia is supposed to stop Iran from building up its forces there, but the U.S. has been left to protest feebly as Russia lets Iran continue....

“If the Trump Administration is worried about this gathering storm, you can’t tell from its actions. Secretary of State Rex Tillerson toured the region last week and called for a ‘whole, independent, democratic Syria with no special demarcations dividing Syria and with the Syrian people selecting their leadership through free and fair elections.’ That’s something John Kerry might have said, with a similar lack of credibility with Iran or Russia.

“Mr. Trump promised in October to work with allies to counter Iran’s ‘destabilizing activity and support for terrorist proxies in the region,’ but in Syria the U.S. has shown no strategy for doing so.  Meanwhile, an Iran-Israel conflict grows more likely by the day.”

Prime Minister Benjamin Netanyahu, speaking at the Munich Security Conference, said Israel was prepared to act “not just against Iran’s proxies that are attacking us, but against Iran itself.”

The prime minster held up a piece of the drone Israel recently destroyed, and addressed Iranian Foreign Minister Mohammad Javad Zarif, who was in attendance.

“Do you recognize it? You should, it’s yours. Don’t test us.”

U.S. National Security Adviser H.R. McMaster, also addressing the Munich conference, said Iran is building and arming an increasingly powerful network of proxies in countries like Syria, Yemen and Iraq that can turn against the governments of those states.

“What’s particularly concerning is that this network of proxies is becoming more and more capable, as Iran seeds more and more...destructive weapons into these networks.  So the time is now, we think, to act against Iran,” he said.

Israel: In the ongoing corruption investigation and looming indictments of Prime Minister Netanyahu, a close confidant of the PM is suspected of offering the position of attorney general to an Israeli judge in return for her killing the case into alleged improprieties in Sara Netanyahu’s household spending (just one of the ongoing probes).  Police basically confirmed the report from an Israeli journalist that told of how Netanyahu’s personal spokesperson, Nir Hefetz, offered Hila Gerstel, a retired judge, the position of AG on the condition she would close the case against the prime minister’s wife.  Netanyahu denied the story.

Meanwhile, another confidant of Netanyahu, Shlomo Filber, who was arrested by the police in an investigation into the ties of Israel’s telecom giant with government officials, reached a deal with the police this week to turn state’s evidence.  Accordingly, Filber will incriminate Netanyahu in exchange for a lighter sentence.

A poll by Channel 2 showed that 45% of Israelis believe Netanyahu should resign even before the attorney general decides whether to indict, versus 40% who said he should not.

On a different issue, the United States is expected to move Israel’s embassy to Jerusalem on May 14, known as Israel Independence Day. Who will be prime minister then?

Iraq: We continue to be told that ISIS has been basically eliminated from Iraq and Syria, but Islamic State militants ambushed a group of Iraq’s Shiite-led paramilitary fighters on Monday, killing at least 27 in an area southwest of Kirkuk.

North Korea: Even before the Olympic Games ended, the U.S. said it was imposing its largest package of sanctions against North Korea on Friday, intensifying pressure on Pyongyang to give up its nuclear and missile programs. The U.S. Treasury is sanctioning one person, 27 companies and 28 ships; actions that block assets held by the firms in the United States and prohibit U.S. citizens from dealing with them.

The measures are designed to disrupt North Korean shipping and trading companies and vessels and to further isolate Pyongyang.  Sanctions against the ships would help prevent Kim’s government from conducting “evasive maritime activities that facilitate illicit coal and fuel transports and erode its abilities to ship goods through international waters,” according to Treasury Sec. Steve Mnuchin.  Washington has been talking to regional partners, including Japan, South Korea, Australia and Singapore, about coordinating a stepped-up crackdown that would go further than ever before.

Separately, according to security and intelligence officials, both the U.S. and North Korea are planning sophisticated cyberattacks against each other, with Pyongyang stepping up its cyber capabilities to target international aerospace and defense industries through a hacker group called Reaper, or APT37, which has been identified by an American private security company that tracks cyber attackers around the world.

North Korea is using malware to infiltrate computer networks.

As for Washington, its potential plans for a series of “bloody nose” strikes on targets in North Korea could be more of the cyber kind rather than conventional warfare.

It is thought Pyongyang has a cyber army of 6,000 hackers, set up under the guise of agency Bureau 121 to plunder international banks, conduct military espionage and attack critical infrastructure.

FireEye has been monitoring APT37 since 2012 and said it is “expanding in scope and sophistication.” [Nicola Smith / Irish Independent]

We also learned this week that Vice President Mike Pence was to meet with North Korean officials while in South Korea at the PyeongChang Games, but on Saturday Feb. 10, less than two hours before Pence and his team were to meet with Kim Yo-jung, the younger sister of leader Kim Jong-un, the North Koreans pulled out of the meeting, according to Pence’s office.

As for a summit between the two Koreas after the Games, South Korean President Moon Jae-in reiterated that while his government’s goal is to ease tensions, and North Korea’s participation helped at least temporarily, the possibility of a North-South summit taking place “is like looking for scorched-rice water at a stone well,” Moon said, referencing a Korean proverb similar to seeking hot water under ice.

Moon added: “I hope the dialog that’s currently taking place between South and North Korea will lead to U.S.-North Korea talks  and then to denuclearization.”

Ivanka looked perky today when she arrived in Seoul.

Russia: Anne Applebaum / Washington Post

“For most Americans, the Parkland shooting was a terrible tragedy. But for social media accounts that promote the interests of Russia in the United States, it was a fantastic opportunity.

“On the morning after the tragedy, the Russia-linked accounts were commenting fiercely, pushing the ‘crazy lone killer’ explanation for the shooting and mocking advocates of gun control. According to Hamilton 68, a tracker website created by the German Marshall Fund, a lot of them linked to photos of guns and ammunition on the Instagram account of the suspected killer, plus a screenshot of a Google search for ‘Allahu akbar.’ Others linked to a fact-checking website that debunked some statistics about gun crime. By Friday morning, some of the same accounts were also pushing something slightly different: the hashtag #falseflag. That’s a reference to the conspiracy theory, already widespread 48 hours later, that the shooting never happened, that the attack is a ‘false flag’ operation staged by the U.S. government as a prelude to the seizure of guns. And this is just the beginning.  Over the next few days, many of these same kinds of accounts will invent a whole range of conspiracy theories about the shooting. If the past repeats itself, pro-Russian, alt-right, white-supremacist and pro-gun social media accounts will promote the same hashtags and indulge in the same conspiracy theories.  Each group has its own interests in pushing #falseflag, but the Russian interest is clear. They do it because it helps undermine trust in institutions – the police, the FBI, the media – as well as in the government itself.  They also do it because it helps to amplify extremist views that will deepen polarization in U.S. political life and create ever angrier, ever more partisan divides....

“Despite what is now overwhelming evidence of Russia involvement in the last U.S. presidential election, no one at the highest level of the U.S. government has made a significant commitment to prevent Russian involvement in the next election, or the next debate, or the next national argument, either. Trump continues to regard Russian intervention as a ‘hoax.’ Trump’s aides and lieutenants have refused to spend any time or political capital on finding solutions....Remember all of that over the next few days as you read the indictment of the Russian Internet team, along with the commentary – because the same tactics, the same games, are already in use once again.”

Separately, with the March 18 presidential election looming, opposition leader Alexei Navalny has been detained and charged with violating public assembly laws.

“I got a toothache, I went to the dentist. Stepped out of the dentist – ‘Hello [...] you are being detained.’ They’re taking me somewhere,” Navalny tweeted on Thursday.

He followed up minutes later, saying authorities charged him with an administrative violation of public assembly rules – a charge that carries a maximum sentence of 30 days – before releasing him.

“I was released until the trial. It’s unclear when the trial will take place,” Navalny wrote.

This is beyond pathetic.  Don’t expect President Trump to tweet about it.

Brazil: The military is taking over public security in Rio de Janeiro until the end of the year as the country struggles with surging violence in the city. An Army general will now report directly to President Michel Temer, as Rio saw 2,125 violent deaths last year, a 37% increase since 2014, including several cases of children being killed by stray bullets. This year’s Carnival festivities were marred by gun battles and mass robberies.  Yikes.

Random Musings

--Presidential tracking polls....

Gallup: 37% approval of Trump’s job performance, 59% disapproval [2/18]
Rasmussen:  50% approval, 49% disapproval [highest approval rating since mid-June]

A new Quinnipiac University poll gave President Trump a 37% approval rating, 58% disapproval, compared to a 40-55 split February 7, in the wake of his State of the Union address. [Republicans: 86-10; Democrats: 3-96; Independents 37-57; Men: 45-51; Women 30-65.]

American voters say 53-38 percent, including 47-36 among Independent voters, they want the Democratic Party to win control of the House, which is back to the margins of a few months ago after the gap had closed to basically zero.

--In a highly significant move in terms of the November elections and the effort of the Democrats to retake the House, Pennsylvania’s Supreme Court imposed a new congressional map that gives Democrats the potential to flip at least four Republican-held seats, according to an analysis from the Cook Political report.

The state high court had ruled that Republicans had unlawfully redrawn the state’s districts to maximize GOP gains.  So a new map was put together with fresh district boundaries.

This is big. Republicans hold a 12-5 edge in the state’s congressional delegation, with a special election to fill the seat of Republican Rep. Tim Murphy scheduled for March 13. 

Editorial / Wall Street Journal

“Political chaos has broken out in Pennsylvania after the state’s high court last week redrew the congressional map for this year’s midterm elections. Behold our future judicial overlords if the U.S. Supreme Court rules that partisan gerrymanders are unconstitutional.

“Last month a 5-2 liberal majority of the Pennsylvania Supreme Court struck down, with unvarnished political hubris, the congressional map adopted by the GOP legislature way back in 2011. The districts ‘clearly, plainly and palpably violate our state Constitution’ that guarantees that ‘elections shall be free and equal,’ the judges opined.

“According to the majority, the gerrymander diluted the voting rights of some Democrats by cramming them into a handful of districts. As evidence, the judges noted that in 2012 Democrats won five of 18 congressional districts with an average 76.4% of the vote in each while receiving 50.8% of the statewide vote. The judges also emphasized that Republicans haven’t lost a district since 2011, yet the special election next month in southwestern Pennsylvania for Rep. Tim Murphy’s seat is competitive. So was the race in November to replace Republican Patrick Meehan in Philadelphia’s suburbs.

“While the U.S. Supreme Court has held that partisan gerrymanders may violate the U.S. Constitution, it has been unable to articulate a precise legal standard.  Democrats are now trying to tempt the Supreme Court into intervening in the intrinsically political redistricting process with social-science methodology that purportedly measures proper representation....

“Pennsylvania’s constitution gives the legislature plenary authority to draft congressional maps.  Nonetheless, the Democratic majority on the high court – judges in Pennsylvania are elected – gave the legislature all of three weeks to redraw districts that would meet Democratic Governor Tom Wolf’s approval.

“The judges specified that the districts must have equal populations, be ‘compact and contiguous geographical territory’ and respect ‘the boundaries of existing political subdivisions contained therein.’ These requirements are nowhere in the state constitution.

“Notably, the judges did not articulate a precise standard for reviewing partisan gerrymanders. It’s possible for the legislature to draw a map complying with the court’s ‘neutral criteria,’ the majority wrote, but that still could ‘unfairly dilute the power of a particular group’s vote for a congressional representative.’ In other words, the judges can do what they want.

“And with the help of Stanford University law professor Nathan Persily they drafted their own new map Monday for use in the May primaries after the Governor and legislature failed to agree.  The revised map makes at least three GOP districts more competitive and disrupts several races....

“State judges can’t usurp the legislature’s authority over redistricting willy-nilly.  The Supreme Court ought to block this judicial coup d’etat, but be warned.  Pennsylvania will be the future in every state if the Justices decide that judges should be redistricting kings.”

--President Trump endorsed Mitt Romney in Utah’s Senate race, another sign the two are trying to bury the hatchet. Romney announced he was seeking the nomination to replace retiring Sen. Orrin Hatch and in a tweet Monday night, Trump wrote, “He will make a great Senator and worthy successor to @OrrinHatch, and has my full support and endorsement!”  Romney quickly accepted the endorsement via Twitter.

Editorial / Wall Street Journal

“Mitt Romney announced Friday that he’s running for the U.S. Senate from Utah, and the timing on the same day as the Justice Department indictments of Russians for meddling in the U.S. presidential election was apt. Mr. Romney was right about the Russian threat in 2012, and Democrats who are now echoing him when it serves their political purposes against Donald Trump owe the former GOP presidential nominee an apology.

“Start with Barack Obama, who derided Mr. Romney’s claim that Russia was a major U.S. geopolitical foe in the third presidential debate in 2012.  ‘The 1980s are now calling to ask for their foreign policy back because the Cold War’s been over for 20 years,’ Mr. Obama said, to applause from the Democratic media establishment.  In its endorsement of Mr. Obama, the Washington Post criticized Mr. Romney for ‘calling Russia America’s greatest foe’ as an example of his lack of judgment.

“Readers may recall that Mr. Romney made his comments about Russia after Mr. Obama was caught unaware talking on an open microphone with then Russian President Dmitry Medvedev in March 2012:

“ ‘On all these issues, but particularly missile defense, this, this can be solved, but it’s important to give me space,’ Mr. Obama told Mr. Medvedev, the Vladimir Putin stand-in.

“ ‘Yeah, I understand,’ Mr. Medvedev said.

“Mr. Obama then said, ‘This is my last election. After my election, I have more flexibility.’

“Mr. Medvedev: ‘I understand. I will transmit this information to Vladimir.’”

“The ‘flexibility’ after Mr. Obama’s election turned out to be Mr. Putin’s as he invaded and annexed Crimea, started a war to occupy the Donbas region in Ukraine, intervened to prop up Bashar Assad in Syria, covered for Assad’s use of chemical weapons, and helped North Korea evade United Nations sanctions.

“Thanks to last week’s indictments, we also know that Mr. Putin’s attempt to meddle in U.S. elections began in 2014, long before Mr. Trump chose to run for President. That interference went unopposed, and as far as we can tell, unanticipated by Mr. Obama, his CIA Director John Brennan and his Director of National Intelligence James Clapper until nearly the end of Mr. Obama’s second term. They did nothing about it until after Hillary Clinton lost....

“Mr. Romney is expected to win the Utah seat with ease, which should make him available to instruct Democrats on foreign affairs.”

--Outgoing Republican Rep. Ileana Ros-Lehtinen (Fla.) said on CBS’ “Face the Nation” that it would be “foolish” for the GOP not to realize that it’s “heading into trouble” in the next election.

Ros-Lehtinen noted that “few women” are running for office as Republicans.  “Far greater numbers of women are identifying themselves as being in the Democratic party,” she said, adding, “I don’t see that we really have a recruiting program that’s active to get minorities involved in our party” as well.

Ros-Lehtinen decried that the growth of the GOP “seems to be very limited in a specific group,” which is idiotic (that’s me), because as the congresswoman noted, “the demographics of our great country is changing greatly.”

--The aforementioned Quinnipiac University poll also asked American voters whether President Trump should publicly release his tax returns and by a 67-24 percent margin, the answer is ‘yes.’ By 61-30 they do not like him as a person.

Also, American voters by a 76-18 margin, including 55-35 percent among Republicans, that the Russian government did try to influence the 2016 presidential election, the highest number so far for this question.

--Survivors of the shooting at Marjory Stoneman Douglas HS in Parkland grilled lawmakers and National Rifle Association spokeswoman Dana Loesch in a raucous meeting sponsored and aired by CNN Wednesday.

“Your comments this week and those of our president have been pathetically weak,” parent Fred Guttenberg, whose 14-year-old daughter Jamie was among the 17 killed, told Sen. Marco Rubio.

“Look at me and tell me guns were the factor in the hunting of our kids in school and look at me and tell me you accept it and you will work with us to do something about guns.”

Rubio said the killings “cannot be solved by gun laws alone,” which drew jeers from the crowd, but he pointed out where he disagreed with the NRA – such as his desire to lift the legal age of rifle purchases from 18 to 21.  Rubio also said he supports improving background checks and banning bump stocks.

But Rubio said he’s “not comfortable” with arming teachers, as President Trump suggested earlier in the day.

Douglas student Cameron Kasky put Rubio on the spot by asking if he’s willing to stop accepting campaign contributions from the NRA.

“Sen. Rubio can you tell me right now that you will not accept a single donation from the NRA?” Kasky asked.

Rubio answered by saying he can justify his acceptance of NRA money because “people buy into my agenda.”

Kasky refused to accept that answer: “In the name of 17 people, you cannot ask the NRA to keep their money out of your campaign?”

Rubio responded: “I think in the name of 17 people I can pledge to you that I will support any law that will prevent a killer like this from getting a gun.

“I will do what I think is right. They buy into my ideas, I don’t buy into theirs.”

I was going to say all kinds of things about our new student activists, but I’ve learned to hold off on totally speaking my mind. I’m the ‘wait 24 hours’ guy after all.

But I do admit to thinking when the students of Marjory Stoneman Douglas High first emerged, ‘Boy, this isn’t going to end well.  They’re out over their skis.’

There are already three kids I don’t like, and it’s sad that some of them are already being blistered on social media. 

But if they help bring about positive change, that’s terrific. I wish them well.

--Missouri Republican Gov. Eric Greitens was indicted by a St. Louis grand jury Thursday for invasion of privacy stemming from a 2015 extramarital affair.

Greitens, a former Navy SEAL, admitted earlier this year to cheating on his wife after a local news station released recordings of the woman describing a sexual relationship with the governor.

The indictment states that Greitens knowingly photographed the unnamed victim in partial or full nudity without her knowledge and consent.

Greitens said he wouldn’t resign. What a dirtball.

--The survey of American presidents, as put out by Brandon Rottinghaus and Justin S. Vaughn, tallying the opinions of 170 members of the American Political Science Association’s Presidents and Executive Politics section, is beyond stupid.  It ranks President Trump last, after one year where he was as consequential as any president of the modern era, and if you’re using the one-year lens, there is no way he is close to worst.

His behavior is as bad as any, but the record thus far in terms of the U.S. economy is good.

You can’t dignify a survey giving a president a grade after just one year....period. That’s scholarship?  C’mon...the Washington Post and New York Times, among others, should never have published it.

After four years, it’s fair to begin ranking Trump.  End of story.

Having said that, the consensus of the 170 is:

1. Lincoln
2. Washington
3. FDR
4. Teddy Roosevelt
5. Jefferson
6. Truman
7. Eisenhower
8. Obama!
9. Reagan
10. LBJ

Barack Obama should be in the bottom five, as I said over the years, and once historians fully understand what transpired in 2012, as noted above, he’ll be down with James Buchanan.  I also believe George W. Bush is bottom five.  And I suspect I won’t be judging Trump very kindly.

But what really ticks me off with this ranking is James Polk at No. 20.  The guy is anywhere from 8 to 10.

[LBJ at 10 is another joke.]

For the record, Dems in the survey had Obama No. 6, Independents No. 12, and Republicans No. 16, further disproving this crappy piece of work.

But even Republicans in the survey of 170 had Trump at 40 (Polk at 13).

--We note the passing of Jeffrey Bell, 74, a conservative theorist who long ago shook things up in my home state of New Jersey, upsetting liberal fellow Republican, Sen. Clifford Case, in 1978 when Bell was only 34 years old.  A lot of us thought this was a rising superstar, even after his loss in the ’78 general election to the Democrat, Bill Bradley, but while Bell lost two other Senate bids, he made his mark on economic and social issues inside the party apparatus and played an important role in establishing the Reagan agenda and massive tax cuts.

Bill Bradley said this week: “You learn a lot about somebody when he’s your opponent.  Jeff was a man of ideas, he was a man of principle, and he never took a cheap shot. Later, when I became an advocate for tax reform – closing loopholes and lowering rates – Jeff became a real ally.”

Conservatives rank Bell with Representative Jack Kemp, along with the Wall Street Journal’s Jude Wanniski and Robert L. Bartley, as the top figures in the emergence of ‘supply-side economics.’

In an obituary, the Journal lauded Bell for his “cheerful populism in the Reagan and Kemp mode.” Despite his electoral defeats, the editorial said, “his ideas over a lifetime were more influential in shaping American politics than those of nearly all senators.”

Bell served as national campaign coordinator for Kemp’s presidential primary campaign in 1988, after which he was president of an economic and political consulting company in Arlington, Va., which became known as Lehrman Bell Mueller Cannon.

--A USA TODAY analysis of crime data for 2017 found that for America’s 50 biggest cities, the homicide rate dipped slightly, though this was an improvement over FBI data that showed back-to-back years in which homicides rose sharply in large cities.  (Homicides in cities with 250,000 or more residents rose by about 15.2% from 2014 to 2015, and 8.2% from 2015 to 2016.)

In 2017 there were 5,738 homicides in the nation’s 50 biggest cities compared with 5,863 in 2016, a roughly 2.3% reduction.  But it is really a 1.1% reduction because Las Vegas police didn’t include the Oct. 1 mass shooting that left 58 dead in their tally.

The national decrease in killings in 2017 was largely driven by double-digit percentage dips in some of the biggest cities, including Chicago (14.7%), New York City (13.4%) and Houston (11%).

--According to a study carried out by marine scientists at NUI, Galway, 73 percent of the monitored deep water fish from the Northwest Atlantic Ocean had ingested plastic particles – one of the highest frequencies of microplastic in fish worldwide.  The Marine Institute’s Celtic Explorer research vessel took dead deep sea fish from midwater trawls in the area.

--Talk about crazy weather.  In the New York area, we smashed all-time high temperature records on Wednesday. It hit 77 where I live, like 8 degrees over the record, but in the San Joaquin Valley of California it was in the mid-20s on Tuesday morning, which threatened the almond and cherry crops.

I saw where the polar vortex split in two, which is pretty rare, with half going to Europe, where it has indeed been unseasonably cold, and the other half to the western U.S.

And that’s your national and world weather update for Friday.  Good luck to our friends in the Midwest with the flooding.

--The great Billy Graham died on Wednesday.  He was 99. 

Graham was the most dominant American pastor of the second half of the 20th century, counseling nine president, filling stadiums and lifting his evangelism into the religious mainstream.

Former President Jimmy Carter said in a tweet: “Tirelessly spreading a message of fellowship and hope, he shaped the spiritual lives of tens of millions of people worldwide.  Broad-minded, forgiving, and humble in his treatment of others, he exemplified the life of Jesus Christ by constantly reaching out for opportunities to serve.”

Billy Graham began preaching to the masses after World War II, and as one biographer noted, he did not hide behind a pulpit. He “stalked and sometimes almost ran from one end of the platform to the other,” while beseeching unbelievers to give themselves to the higher power he praised with unassailable conviction.

It’s hard to imagine how Graham drew 350,000 people to a tent in downtown Los Angeles over eight weeks in 1949 – the first major Billy Graham crusade.  When it ended, 65 sermons later, he was known throughout the country, and not too long after, throughout the world.

Over his career, Graham preached to nearly 215 million people in more than 185 countries and territories, according to figures compiled by the Billy Graham Evangelistic Assn., and was heard and seen by hundreds of millions more through television and radio, newspaper columns and later the internet.

It is with good reason that Graham and the pope were the two best-known figures in the Christian world.

Graham attended or participated in eight presidential inaugurations, and was present at the White House during some of the darkest hours. He stayed close to Lyndon Johnson when his popularity was plummeting because of the Vietnam War, and he supported Richard Nixon for longer than most thought prudent.  He forgave President Clinton during the Monica Lewinsky scandal and counseled Hillary to do the same.

And when Ronald Reagan was first diagnosed with Alzheimer’s, Rev. Graham was one of the few allowed to visit the former president in California. Graham was so well liked, he participated in the Bush family’s retreats in Kennebunkport.  Graham influenced George W. Bush’s turn in religion.

Editorial / Washington Post

“America has been heavily influenced, even shaped, by its preachers, from Jonathan Edwards to Henry Ward Beecher and the televangelists of today. Some fostered great and needed social change (Northern Protestant churchmen and women created the abolition movement); others sought to impose their will on a dubious nation (as in Prohibition).  A few were frauds or hypocrites and were eventually discredited. But through a half-century and more, Mr. Graham maintained his standing....

“Mr. Graham kept his message relatively simple, which may be one reason it endured. He was never a great hero of the political left or right, though he took a stand fairly early in this country’s civil rights movement against segregation, and spoke often, if somewhat vaguely, on the need for social justice....

“When he was young, Mr. Graham had a close relationship with Charles Templeton, a fellow evangelist. The two eventually parted ways, with Mr. Templeton going on to what he saw as a more intellectual and skeptical view of religion.  Many years later, Mr. Templeton recalled of his old friend, ‘I disagree with him profoundly on his view of Christianity and think that much of what he says in the pulpit is puerile nonsense. But there is no feigning in him: he believes what he believes with an invincible  innocence. He is the only mass evangelist I would trust. And I miss him.’”

Editorial / Wall Street Journal

“When Graham brought his crusade to England in 1954, for example, he attracted 120,000 people to Wembley Stadium – at the time the largest religious gathering ever in the British Isles, and he gained an admired in a young Queen Elizabeth.  Later he would take the Gospel into some of the earth’s most aggressively atheist regimes, including North Korea.

“What message proved to be so attractive? At a 1954 press conference in London, Graham explained his approach: ‘I am going to preach a gospel not of despair but of hope – hope for the individual, for society and for the world.’

“In preaching this Christian hope of salvation, Graham gave the world a new image of the evangelical Christian. Rather than try to convert Catholics, for example, Graham sent them back to make peace with their own churches as he did with other Christian denominations. In the 1950s he insisted that his revivals be racially integrated, and he invited a fellow minister named Martin Luther King to give the opening prayer at his crusade at Madison Square Garden....

“The West in general, including the U.S., has become far more secular than in Graham’s heyday, and it is hard to imagine another man of faith enjoying the same prominence and influence today. America’s largely secular media also seem to revel in demonstrating that anyone prominent in religious life is a fallen idol.

“Then again, Billy Graham knew that if the hope and salvation he preached found a welcome reception in people’s hearts, it wasn’t because of the charm or charisma of the messenger.  It was because of the power of the message.”

---

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

God bless America.

---

Gold $1330
Oil $63.57...nice two-week rebound off $59

Returns for the week 2/19-2/23

Dow Jones  +0.4%  [25309]
S&P 500  +0.6%  [2747]
S&P MidCap  +0.2%
Russell 2000  +0.4%
Nasdaq  +1.4%  [7337]

Returns for the period 1/1/18-2/23/18

Dow Jones  +2.4%
S&P 500  +2.8%
S&P MidCap  +0.2%
Russell 2000  +0.9%
Nasdaq  +6.3%

Bulls 48.5...huge drop from 66 in three weeks
Bears 14.6 [Source: Investors Intelligence]

Have a great week.

Brian Trumbore



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Week in Review

02/24/2018

For the week 2/19-2/23

[Posted 11:30 PM ET, Friday]

Note: StocksandNews has significant ongoing costs and your support is greatly appreciated. Please click on the gofundme link or send a check to PO Box 990, New Providence, NJ 07974.

Edition 985

I watched it all this week...the White House listening session, the CNN town hall, Trump’s CPAC speech, and his Friday press conference with Australian Prime Minister Turnbull.

I was appalled by Trump’s statement Friday afternoon on Syria, moved by the listening session, ticked off by the behavior at the CNN confab, and bemused by CPAC because that was the stupidest hour+ long speech I’ve ever heard.

The story this week wasn’t Parkland and its aftermath, however, but the ongoing carnage and pure barbarism on the part of the Bashar Assad regime in Syria, together with its Russian ally, in the Damascus suburb of Eastern Ghouta.

But I told you back in 2012 it was over in Syria; Bin Laden is dead, General Motors is alive...that is all we heard.  I have long proved that Barack Obama will pay a severe price in the history books for his inaction at that time...for his failure to join Turkish President Erdogan in the establishment of a no-fly zone that would have largely stopped the Syrian war cold when the death toll was ‘only’ 20,000.

There would have been no ISIS, no mass migration to Europe, no Russian involvement, no 400,000 additional dead.  Iran’s future participation in the theater would have been severely limited.  Israel wouldn’t be facing the immense threat it is today and instead would be dealing with one it can handle.

For Obama, though, it was all about the election.  No Profiles in Courage for him.

So forgive me if the handwringing over some of the events in the U.S. these days doesn’t move me quite as much as perhaps I should be.  2012 is going down in history like 1938.  Neville and Barack.  I’ll long be dead when the final history is written of the consequences from decisions not made; roads not taken in 2012 will be ingrained in the psyche of people the world over the next 100 years.  It’s just that today, as was the case in 1938, people don’t understand.

Meanwhile, now we have a president who while not responsible for how it all evolved, doesn’t have a clue as to what is coming next.

Trump World

Parkland and Gun Control: A Quinnipiac University national poll shows American voters support stricter gun laws by a 66-31 margin, the highest level of support ever measured by Quinnipiac. This result is up from a negative 47-50 percent measure of support in a Dec. 23, 2015 survey.

Support for universal background checks is itself almost universal, 97-2 percent, including 97-3 among gun owners.

But in a Washington Post-ABC News poll post-Parkland, Americans are roughly split on reinstating the 10-year ban on assault weapons that expired in 2004, with 50 percent in support and 46 percent opposed, a stark contrast from the 80 percent support for the ban in 1994, the year it was enacted. The current level of support is little different from 51 percent in 2016.

Speaking Thursday with state and local officials at a White House meeting on school safety, Trump said students should be protected the way banks are and repeated his call for arming teachers to help protect students, but only highly trained people would carry weapons in school.

“I think a concealed permit for teachers, and letting people know there are people in the building with a gun, you won’t have...these shootings,” he said.

But the prospect for any real gun-control bill making it through Congress in an election year is minimal, unless the president chooses to keep it in the spotlight, which would put pressure on Republicans.

Certainly, while he ran on a gun-rights platform, proposals for strengthening background checks and limiting access to firearms by people with mental illness and banning devices such as bump stocks can get through the House, which is where the real test will be, not the Senate.

--The only armed security guard on campus during the deadly mass shooting, Scot Peterson, a sheriff’s deputy, “never went in” to the school building to try to take down the shooting suspect, Sheriff Scott Israel of Broward County shockingly announced at a news conference on Thursday.

Two other deputies were placed on restricted duty while the department investigates their handling of reports about the gunman well before last week’s rampage.

But as for Peterson, police protocol requires confronting shooting suspects as quickly as possible.  He should have “went in, addressed the killer, killed the killer,” said Sheriff Israel.

Instead, Peterson remained outside the freshman building for “upwards of four minutes” while Nikolas Cruz was inside.

Surveillance video showed Peterson was doing “nothing,” Israel said, who described himself as “devastated, sick to my stomach.”

“There are no words,” he said.

We learned today that three other deputies may not have entered the building as they should have.  Cruz may have already exited, but they should have been in there to help treat the wounded.

But almost equally outrageous was another fact learned on Thursday...that the surveillance footage from inside the high school was not shown live, but instead police were watching it on a 20-minute delay, leading them to believe the gunman, Cruz, was still in the building when he was at Walmart.  That is unbelievable.

Apparently during the immediate response to the event, the system was being viewed in real-time but then the recorded footage was being viewed to retrace the actions of the shooter and it took some time for officers to realize they were seeing it on delay.

Today, we also learned that Broward County deputies received at least 18 calls warning them about Cruz from 2008 to 2017, including concerns that he “planned to shoot up the school” and other threats and acts of violence prior to Parkland.

The warnings were relayed by concerned people close to Cruz. No action taken. Then the kid exploded.

Friday, Florida Republican Gov. Rick Scott announced a proposal to increase restrictions on buying guns and to strengthen school safety measures.

Scott said he would work with state lawmakers during the next two weeks to raise the minimum age for buying any kind of gun in Florida to 21, with some exceptions for younger military members and law enforcement officers.  Today, as we all now know, weapons such as the semiautomatic AR-15-style assault rifle can be bought by people as young as 18 in the state.

Scott also said he would make it “virtually impossible for anyone who has mental health issues to use a gun, and he wants to ban the sale and purchase of bump stocks, an accessory that transforms a semi-automatic rifle into a weapon able to fire hundreds of rounds a minute, as we learned with the Las Vegas shooting.

I agree with all the above.  Just do it.  It’s a good start.

John Podhoretz / New York Post

“Some facts. There are 126 million households in the United States. In 35 percent of those households – some 44 million – there is a gun. There is an average of 2.8 people per household, according to the Census Bureau. This means that something like 120 million people in this country live with at least one gun in their homes.

“In 2013, 107,000 crimes in the United States were committed with a gun. There are 330 million people in the United States. If we assume every one of those crimes was the work of a different individual, then .03 percent of all those who live with a gun in the United States used that gun in the commission of a crime.

“That’s not 3 percent. That’s not one-third of a percent. That’s three-hundredths of a percent.

There are approximately 120,000 schools in the United States. If we use the term ‘school shooting’ in the most capacious way, there have been 145 incidents since 2010.That means .12 percent of all schools in the United States have suffered the horror of a school shooting.

“If you are the sort of person who believes guns are evil objects no one should want to possess, or that semi-automatic weapons are especially monstrous devices no one should be allowed to own, these numbers won’t matter all that much to you, or at all.  In your mind, the very fact that guns are used in crimes, especially in mass shootings, invalidates any arguments on their behalf.

“Now, you might be stirred to appreciate the challenges to a family in a rural area 25 or 50 miles from the nearest police station who could not rely on the local constabulary to protect them from a marauder.

“And you might appreciate that people under direct threat – someone under a fatwa, say, or a celebrity with a violent stalker – might need special protection from a private bodyguard carrying a weapon.

“But you are almost certain to ask, ‘Why does anyone need these things when they can do such harm?’  You scoff at the tired line that guns don’t kill people; people kill people. You have likely assigned moral meaning to the ownership of a gun. And you have judged those who own one to be suffering from a moral flaw, and those who own many to be fetishistic monsters.

“Here’s the thing, my gun-restricting friends (and I have many). Those 35 percent of American households are geographically distributed in such a way that you’ll never secure your objective if you cannot engage the people who own guns in a conversation that begins with the proposition that you are better than they are.

“Because they don’t think you are better than they are. They think they are just fine....

“What you have to understand is that while you believe you have all the moral force on your side, you cannot make a gun owner believe that he is the Parkland shooter. Because he isn’t. And let’s face it – somewhere, deep in your heart, you think he is.

“So if you genuinely want to alter the trajectory of America’s gun culture, stop thinking of yourself as a moral paragon and the people whose rights you are seeking to curtail as potential mass murderers and start thinking of them as fellow citizens you have to convince.”

Trumpets....

--Special counsel Robert Mueller unsealed new charges on Thursday against President Trump’s former campaign chairman, Paul Manafort, accusing him of hiding income and defrauding banks, with similar new charges against Manafort’s longtime business associate and campaign deputy, Rick Gates, who was indicted along with Manafort back in October.

The original indictment did not explicitly bring tax charges, so it was thought Mueller would eventually correct this.

The charges do not involve Trump or his campaign and predate either man’s involvement with the president.

But there seems to be no doubt Mueller is further pressuring Manafort and Gates in an effort to get them to provide information about Trump and the campaign, and this afternoon, Gates pleaded guilty to two charges, making him the fifth person to publicly admit to criminal misconduct in Mueller’s probe.  Gates faces roughly 4 ½ to 6 years in prison, though he could receive credit for the level of cooperation he provides prosecutors.

Manafort issued a statement saying he would continue to defend himself “against the untrue piled up charges” against him.  “I had hoped and expected my business colleague would have had the strength to continue the battle to prove our innocence. For reasons yet to surface he chose to do otherwise.”

Now it’s about what Gates really has on Manafort.

--Tweets: “If it was the GOAL of Russia to create discord, disruption and chaos within the U.S. then, with all of the Committee Hearings, Investigations and Party hatred, they have succeeded beyond their wildest dreams. They are laughing their asses off in Moscow. Get smart America!”

“Now that Adam Schiff is starting to blame President Obama for Russian meddling in the election, he is probably doing so as yet another excuse that the Democrats, lead by their fearless leader, Crooked Hillary Clinton, lost the 2016 election. But wasn’t I a great candidate?”

“I never said Russia did not meddle in the election, I said ‘it may be Russia, or China or another country or group, or it may be a 400 pound genius sitting in bed and playing with his computer.’ The Russian ‘hoax’ was that the Trump campaign colluded with Russia – it never did!”

“Finally, Liddle’ Adam Schiff, the leakin’ monster of no control, is now blaming the Obama Administration for Russian meddling in the 2016 Election. He is finally right about something.  Obama was President, knew of the threat, and did nothing. Thank you Adam!”

“Never gotten over the fact that Obama was able to send $1.7 Billion Dollars in CASH to Iran and nobody in Congress, the FBI or Justice called for an investigation!”

“General McMaster forgot to say that the results of the 2016 election were not impacted or changed by the Russians and that the only Collusion was between Russia and Crooked H, the DNC and the Dems.  Remember the Dirty Dossier, uranium, Speeches, Emails and the Podesta Company!”

“Question: If all of the Russian meddling took place during the Obama Administration, right up to January 20th, why aren’t they the subject of the investigation? Why didn’t Obama do something about the meddling? Why aren’t Dem crimes under investigation? Ask Jeff Sessions!”

“I have been much tougher on Russia than Obama, just look at the facts. Total Fake News!”

“Very sad that the FBI missed all of the many signals sent out by the Florida school shooter. This is not acceptable. They are spending too much time trying to prove Russian collusion with the Trump campaign – there is no collusion. Get back to the basics and make us all proud!”

“I never said ‘give teachers guns’ like was stated on Fake News @CNN & @NBC. What I said was to look at the possibility of giving ‘concealed guns to gun adept teachers with military or special training experience – only the best. 20% of teachers, a lot, would now be able to”

“...immediately fire back if a savage sicko came to a school with bad intentions. Highly trained teachers would also serve as a deterrent to the cowards that do this. Far more assets at much less cost than guards. A ‘gun free’ school is a magnet for bad people,  ATTACKS WOULD END!”

“...History shows that a school shooting lasts, on average, 3 minutes. It takes police & first responders approximately 5 to 8 minutes to get to site of crime. Highly trained, gun adept, teachers/coaches would solve the problem instantly, before police arrive. GREAT DETERRENT!”

“Just watched a very insecure Oprah Winfrey, who at one point I knew very well, interview a panel of people on 60 Minutes. The questions were biased and slanted, the facts incorrect. Hope Oprah runs so she can be exposed and defeated just like all of the others!”

--Opinion....including on last Friday’s federal grand jury indictment of 13 Russian nationals and their attempt to sway the 2016 election.

Dan Henninger / Wall Street Journal (he’s shortened his name from Daniel, I see)

“Two possibilities for comment present themselves this week.  One is what Robert Mueller’s exposure of a Russian network of provocateurs operating in the U.S. since March 2014 says about the Trump-Russia collusion narrative. The other is the FBI’s failure to act on a substantial tip about the disturbed and ultimately homicidal Nikolas Cruz, who as promised went on a high-school killing spree.

“There is no reason for anyone to comment on the credibility of the collusion narrative because the president himself is covering that from his Twitter account. On Saturday he suggested that events like the Parkland killing happen because the FBI is ‘spending too much time trying to prove Russian collusion with the Trump campaign.’

“With that conflation, Mr. Trump’s bunker-busting tweets hit a new bottom of personal reprehensibility. But since Mr. Trump is taking care of the person he calls ‘Trump’ in the Mueller showdown, we’ll turn to the problem that affects everyone else: a federal agency failure that contributed to 17 deaths in Florida.

“This wasn’t the first time. Or the second, or the third. The number of catastrophic events attributable in no small part to federal-agency failure in recent years is staggering.

“Missed signals at some level of the federal government or other public agencies preceded mass shootings at Sutherland Springs, Texas (25 killed), Charleston (nine people); the Orlando nightclub (49); Fort Hood (13); San Bernardino (14) and the Boston Marathon bombing (three dead and multiple severed limbs).

“The error list goes on: Amtrak’s derailments, the National Security Agency letting Edward Snowden walk away with the crown jewels on a thumb drive, or the deadly Veterans Administration.

“Why do these public-agency mistakes continue to happen? The reasons are complex, (but) the simple answer is that the federal government has become too big to succeed. Its vastness ensures mistakes, and its public-safety responsibilities ensure that some of those mistakes will be fatal.

“Two pained words emerge from the ashes of every such event: ‘Do something.’

“Nearly every function government performs is at some level a response to ‘Do something.’  A bad event happens, and the political default is to add another layer to what  we expect government to do.

“The 9/11 Commission was a positive response to ‘Do something.’ It exposed the resistance of the FBI, CIA and State Department to sharing intelligence. But Russian spies running wild in the U.S. from 2014 through 2017 suggests the silos have re-formed, or the agencies have too many distractions....

“Federal bureaucracies no longer own the problem of producing unintended catastrophe on a grand scale. Facebook, Google and Twitter are magnificent machines, like the web itself. But the always-on web has liberated the world’s previously closeted fanatics and helped turn borderline psychotics and terrorists into up-and-running threats.

“Facebook has 2.2 billion users. The FBI agent who thought Nikolas Cruz’s homicidal YouTube comment was unexceptional had a point. The idea that social-media companies should police their users is roughly the equivalent of asking them to monitor all of human behavior. For that experiment, we have China’s control-meister Xi Jinping.

“Whether these companies should be broken up is beyond the scope of this column. It’s pertinent to ask, though, whether the federal government’s inexorable bloat has made it a clear and present danger to the American people. That’s a question for public safety. It’s also a question for our politics.”

Thomas L. Friedman / New York Times

“Our democracy is in serious danger.

“President Trump is either totally compromised by the Russians or is a towering fool, or both, but either way he has shown himself unwilling or unable to defend America against a Russian campaign to divide and undermine our democracy.

“That is, either Trump’s real estate empire has taken large amounts of money from shady oligarchs linked to the Kremlin – so much that they literally own him; or rumors are true that he engaged in sexual misbehavior while he was in Moscow running the Miss Universe contest, which Russian intelligence has on tape and he doesn’t want released; or Trump actually believes Russian President Vladimir Putin when he says he is innocent of intervening in our elections – over the explicit findings of Trump’s own CIA, NSA and FBI chiefs.

“In sum, Trump is either hiding something so threatening to himself, or he’s criminally incompetent to be commander in chief. It is impossible yet to say which explanation for his behavior is true, but it seems highly likely that one of these scenarios explains Trump’s refusal to respond to Russia’s direct attack on our system – a quiescence that is simply unprecedented for any U.S. president in history.  Russia is not our friend.  It has acted in a hostile manner.  And Trump keeps ignoring it all....

“Donald, if you are so innocent, who do you go to such extraordinary lengths to try to shut Mueller down? And if you are really the president – not still head of the Trump Organization, who moonlights as president, which is how you so often behave – why don’t you actually lead – lead not only a proper cyberdefense of our elections, but also an offense against Putin....

“My guess is what Trump is hiding has to do with money. It’s something about his financial ties to business elites tied to the Kremlin. They may own a big stake in him. Who can forget that quote from his son Donald Trump Jr. from back in 2008: ‘Russians make up a pretty disproportionate cross section of a lot of our assets.’  They may own our president.”

Scott Shane / New York Times

“The CIA helped overthrow elected leaders in Iran and Guatemala in the 1950s and backed violent coups in several other countries in the 1960s. It plotted assassinations and supported brutal anti-Communist governments in Latin America, Africa and Asia. ...It illuminates the larger currents of history that drove American electoral interventions during the Cold War and motivate Russia’s actions today. ... At least once, the hand of the United States reached boldly into a Russian election. American fears that Boris Yeltsin would be  defeated for re-election as president in 1996 by an old-fashioned Communist led to an overt and covert effort to help him, urged on by President Clinton. It included an American push for a $10 billion International Monetary Fund loan to Russia four months before the voting and a team of American political consultants (though some Russians scoffed when they took credit for the Yeltsin win). ...In recent decades, the most visible American presence in foreign politics has been taxpayer-funded groups (that) do not support candidates but teach basic campaign skills, build democratic institutions, and train election monitors.  Most Americans view such efforts as benign. ...But Vladimir Putin sees them as hostile.”

Michael Goodwin / New York Post

“After 18 months of Russia, Russia, Russia, we finally meet a cast of real Russians. But par for the convoluted course, they were pretending to be Americans.

“The indictments obtained by special counsel Robert Mueller on Vladimir Putin’s attempts to create discord in the 2016 election and eventually support Donald Trump are important both for what they say and what they don’t say.

“They offer huge victories for Trump – and thus more defeats for Hillary Clinton – but they don’t close the books on everything about 2016.

“The very good news for the president is that the indictments are firm in saying that any Americans contacted by the 13 charged Russians, including Trump campaign associates, did not know they were dealing with Russians.

“The indictments also state forcefully that despite their social media efforts, which ranged from creative to clumsy, the Russians had no impact on the election results.

“Deputy Attorney General Rod Rosenstein announced those findings in a flat monotone that belied their significance.

“ ‘There is no allegation in this indictment that any American was a knowing participant in this illegal activity,’ he said.  ‘There is no allegation in the indictment that the charged conduct altered the outcome of the 2016 election.’

“Those are dramatic statements by any measure.

“Rosenstein’s statements should end Clinton’s disgraceful claim that Trump stole the election.

“She lost the old-fashioned way – by being a terrible candidate. Case closed, though I’m sure Clinton and her legion of dead-enders will find excuses to keep alive her campaign of victimhood.

“Yet the indictments are hardly the final word, and the charges leave plenty of daylight for continued speculation on two fronts.

“One is whether Trump or his associates conspired with top Russian government officials, as opposed to the low-level units carrying out the disruption scheme. So far, there is no public evidence of any connection except the discredited Steele dossier that Clinton paid for, but Rosenstein emphasized the limits of the case at hand by using the phrase ‘in the indictment.’

“By the same token, the charges do not deal with whether Trump obstructed justice by firing FBI Director James Comey.

“Presumably, those two issues are what’s left on Mueller’s plate, meaning America’s political nightmare continues.”

Editorial / Washington Post

(The indictment) undercuts any lingering suggestion that Russian interference is a myth or a hoax, and Mr. Trump, who has often suggested as much, should have acknowledged the new evidence Friday. Instead, his first reaction was to claim vindication on Twitter.

“ ‘The Trump campaign did nothing wrong,’ he wrote, adding, ‘no collusion!’ This was inappropriate on two levels.

“First, though the indictment did say that there was no knowing American collusion with the Russian social media campaign, and though it did not say that it affected  the results, it also showed that the vast majority of Russian propaganda supported Mr. Trump’s campaign and attacked that of his Democratic opponent, Hillary Clinton. You would think Mr. Trump would take a moment to repudiate that support, even in hindsight, and to declare that no foreign power has a right to campaign secretly against an American candidate.

“Second, Mr. Mueller has not finished his investigation and has not ruled out the possibility of collusion.  We don’t yet know whether Donald Trump Jr.’s eagerness to meet with Russians offering ‘dirt’ on Ms. Clinton’s campaign was an isolated incident. Nor has the special counsel yet weighed in on the question of possible obstruction of his investigation by President Trump....

“The grand jury’s indictment shows how far Russia is willing to go to manipulate and discredit our democracy.  Mr. Trump’s own intelligence chiefs warned this week that the 2018 election is under threat. Given the baffling and inexcusable absence of presidential leadership, Congress must step up to defend the nation.”

Editorial / Wall Street Journal

“The indictment’s details underscore Russia’s malicious anti-American purposes. An authoritarian regime spent tens of millions of dollars to erode public trust in American democracy.  As Senator Ben Sasse (R, Neb.) put it Friday, ‘Putin’s shadow war is aimed at undermining Americans’ trust in our institutions. We know Russia is coming back in 2018 and 2020 – we have to take the threat seriously.’

“All of which makes the White House reaction on Friday strangely muted. Its statement understandably focused on the lack of collusion evidence and made one reference to ‘the agendas of bad actors, like Russia.’  But given how much Russia’s meddling has damaged his first year in office, Mr. Trump should publicly declare his outrage at Russia on behalf of the American people. The Kremlin has weakened his Presidency. He should make Russia pay a price that Mr. Obama never did.”

Wall Street

It was another volatile week for stocks, with the Dow Jones taking a  steep dive Tuesday and Wednesday (Monday a holiday), only to recover and then some Thursday and Friday, with the action in the bond pits playing a major role both ways.

At one point the yield on the 10-year Treasury hit 2.95%, a new four-year high going back to Jan. 2014, following the release of the Federal Reserve’s minutes from its last meeting, Jan. 30-31, which showed an Open Market Committee that was comfortable with a forecast of inflation rising to its 2% target over the medium term, citing “substantial underlying economic momentum.”

Fed officials “anticipated that the rate of economic growth in 2018 would exceed their estimates of its sustainable longer-run pace and that labor market conditions would strengthen further,” as a number of participants “indicated that they had marked up their forecasts for economic growth in the near term relative to those made for the December meeting.”

“A majority of participants noted that a stronger outlook for economic growth raised the likelihood that further gradual policy firming would be appropriate,” the minutes said.

Since Fed officials last met in January, data showed wages rising faster than forecast, which helped lead to the market sell-off.

But this coming week, new Fed Chairman Jerome Powell goes before Congress for a first time in this capacity to update both the House and Senate on the economic outlook and each word will be parsed for clues as to whether the Fed will be hiking rates three or four times this year.

The yield on the 10-year finished the week at 2.87%, same as last Friday.

In the only major economic item of note this week (at least that I care about), January existing home sales came in far less than expected, a 5.38 million annualized clip, down 3.2%, with the median home price falling 2.4% to $240,500, though year-on-year this is still up a solid 5.8%, the 71st consecutive month of gains from year ago levels.

Europe and Asia

Markit released its flash readings on the eurozone (EA19) economy for February, with the composite at 57.5 vs. 58.8 in January (50 being the dividing line between growth and recession); services at 56.7 vs. 58.0, manufacturing 58.5 vs. 59.6.

Germany had a manufacturing flash reading of 60.3 vs. 61.1, a 6-month low, while services are projected at 55.3 vs. 57.3, a 3-month low.

France had a flash manufacturing figure of 56.1 vs. 58.4, a 4-month low, while services were at 57.9 vs. 59.2, also a 4-month low.

But all of the numbers are way above the key 50-line, and as Chris Williamson, Chief Economist at IHS Markit, put it:

“February saw the eurozone’s growth spurt lose a little momentum, but the rate of expansion remains impressive, putting the region on course for its best quarter for almost 12 years.

“The PMI readings for the first two months of the quarter generally provide a reliable guide to official GDP growth, and indicate that the eurozone economy is expanding at a quarterly rate of 0.9% in the opening quarter of 2018.

“The service sector is enjoying its best growth spell for seven years and the manufacturing sector’s performance remains one of the strongest seen over the 20-year survey history....

“Price pressures meanwhile remained elevated, in part because stronger demand has enabled more firms to raise their selling prices. However, some comfort can be gleaned from a slight easing in the overall rate of inflation compared to January’s recent high.”

So speaking of inflation, Friday, Eurostats released the figures for January in the eurozone and it was just 1.3% annualized vs. 1.4% in December and 1.8% in January 2017.  So there remains zero pressure on the European Central Bank to begin to change its zero interest rate policy, even as it reduces its bond-buying program.

In Germany inflation is running at 1.4%, France 1.5%, Spain 0.7%, Italy 1.2%, and Greece 0.2%, while it remains 3.0% in the U.K.

Bond yields had risen a bit early in the week on growing speculation that ECB head Mario Draghi’s successor next year will advocate erring on the side of tighter policy, but then they fell back at weeks’ end.

Brexit: Prime Minister Theresa May brought her ministers out to the official residence at Chequers for the purpose of coming up with a united position on Brexit, and after eight hours, it seems they more or less reached agreement that the U.K. will stick to EU rules, but on its own terms, what ministers called “Canada plus plus plus.”

The meeting was needed to break a deadlock in the government and reconcile ministers who advocate different approaches to the future relationship with the EU.

But Brussels has grown impatient with the lack of a clear U.K. position, and deadlines are looming in terms of settling the terms for the transition and the start of trade talks.

Mrs. May wants to stick to EU rules in certain areas, partially abiding in others, and ditching them completely in the rest; what is being called the “three baskets” approach.

But the EU has long said Britain can’t “cherry-pick” its way through Brexit and the European Commission pre-empted the Chequers meeting by ruling out the emerging strategy.

The Commission said in a presentation published on its website:

“U.K. views on regulatory issues in the future relationship including ‘three basket approach’ are not compatible with the principles in the European Council guidelines,” one of the slides reads. If the U.K. “aspires to cherry pick,” there’s a “risk for the integrity” of the single market, it says.

Trade talks are set to begin next month, but the U.K. and EU need to move closer together on their positions soon.  And one issue that is still far from being settled is that of the Irish border.

The thing is, Prime Minister May’s Conservative party is more divided than her cabinet, and there is still a solid chance she is booted out.  Leaders such as Foreign Secretary Boris Johnson, who has long had designs on being prime minister, fear that May will allow the European Court of Justice to keep a role overseeing regulation affecting the U.K. long after Brexit, in return for a palatable trade deal that could tie the country too closely to the EU’s single market, which they would see as a betrayal of the 2016 vote to leave the bloc.

Hard-line advocates of Brexit have argued that Britain should take back control of its laws and judicial system and no longer be beholden to the rulings of the European court.

It’s another red line that Mrs. May has crossed in her dealings with European negotiators, from a divorce settlement of about $55 billion to a transition period in which Britain will keep to EU rules even after it legally quits the bloc.

European Council President Donald Tusk is to meet with May next Thursday, a day before the prime minister is to deliver a speech to outline Britain’s vision of post-Brexit ties with the EU.

But late Friday, following a summit in Brussels, Donald Tusk said Britain’s vision for Brexit is not based on reality, delivering a harsh blow to Mrs. May.

“I’m afraid that the U.K. position today is based on pure illusion,” Tusk told reporters.  “It looks like the cake philosophy is still alive,” he added, referring to Foreign Secretary Boris Johnson’s much-derided claim that Britain could have cut its cake and eat it (too).

“From the very start, it has been a key principle of the EU-27 that there will be no cherry picking and no single-market a la carte,” Tusk said. “This is and will continue to be a key principle, I have no doubt.”

May and the EU must reach agreement on the transition period at a summit of leaders in Brussels in the second half of March. Whatever vision May and her team come up with, it will still have to be acceptable to the other 27.

Germany: As Chancellor Angela Merkel awaits a party vote inside the Social Democrat party (SPD) that would solidify the coalition government (the vote of party members to be revealed March 4), Merkel is facing opposition from within over her compromise with the SPD on the issue of military spending.  A key supporter of Merkel, Norbert Roettgen, blasted Foreign Minister Sigmar Gabriel, a Social Democrat, for questioning the target of 2 percent of GDP spending on defense.

The coalition agreement underscored Germany’s intention to meet its commitment to NATO, but does not explicitly mention the goal of 2 percent spending by 2024.  Roettgen, the head of the foreign affairs committee in parliament, said that if Germany didn’t increase its spending to at least 1.5% of economic output by the end of the next four-year legislative period, up from the current 1.2%, Germany’s credibility within NATO would be shot.

President Trump and other NATO allies have been pressing Germany as Europe’s biggest economy to spend more on its military, especially after the defense ministry’s announcement this week that efforts to improve the readiness of key weapons was starting to pay off; as in 57 percent of the 5,000 major weapons – aircraft, ships and ground vehicles – were available for use, up from 46 percent in March 2015.  Just 57 percent?  Officials say it will take 10 years to reverse erosion caused by years of declining military spending.

Roettgen said: “If we do not reliably stand by commitments we made to NATO, we will lose standing and influence in Washington, and even Moscow won’t take us seriously.”

This is the kind of problem you have in a coalition comprised of conservatives and socialists, boys and girls.

One more...Merkel tabbed a party loyalist who has been floated as a possible successor, Annegret Kramp-Karrenbauer, 55, to the post of general secretary of her Christian Democratic Union.

Eurobits....

--The big election in Italy is next Sunday, March 4, and a three-way coalition featuring Metteo Salvini, head of the anti-migrant League (Northern League); as well as a small party descended from Italy’s wartime fascist party; and Forza Italia, led by ex-Prime Minister Silvio Berlusconi, who is campaigning on a promise to eject 600,000 illegal migrants – appears close to gaining 40% of the vote, which it would then win.

The right-wing trio is benefiting from rising intolerance toward migrants after the arrival of 600,000 by sea, mainly Africans departing from Libya, over the last four years. While many have moved on to other countries, 200,000 are housed in reception centers in Italy waiting on asylum applications. The pictures of migrants in small-town centers are provoking accusations from locals that they are happy to live off Italian taxpayers.

The anti-immigrant fervor has been growing.  Should the above coalition win, under Italy’s complicated system for allocating seats, they would most likely have enough for a parliamentary majority. 

--Speaking of immigration, French President Emmanuel Macron is putting the unity of his parliamentary majority to a test with legislation that will tighten controls over immigration, including speeding up deportations and tightening the classifications for asylum.  The bill is scheduled to be debated in parliament in April.  Migrants associations and human rights organizations expressed their disapproval.

A BVA poll this month showed 63% say there are too many migrants in France.

Meanwhile, Macron’s overall approval rating fell to 44% in an Ifop poll, down 6 points from its previous survey in January.  Government plans to modernize the public administration (government bureaucracy) in a country with one of the highest public spending ratios in the world is needless to say largely unpopular.

--Latvia signaled Russia may be inflaming the crisis engulfing the Baltic nation’s banking industry.

“There is a high probability that an externally organized widespread information operation is being carried out that, by its structure and execution, is identical to those observed in pre-election periods in the U.S., France and Germany,” Latvia’s Defense Ministry said on Tuesday.

Latvia, a regional banking hub, has long faced questions over its enforcement of money-laundering rules.  Last weekend, Central Bank Governor Ilmars Rimsevics was detained as part of a bribery probe. He has been leading the central bank since 2001, making him the longest-serving head of a national bank on the ECB’s Governing Council, which he joined in 2014 after Latvia adopted the euro.

Rimsevics was then released on bail and has denied seeking bribes and accused lenders of conspiring against him.

Today, the central bank provided an emergency load to troubled lender ABLV, offering it a potential lifeline as an ECB deadline approaches for the bank to present a credible survival plan.

ABLV, the nation’s third-largest lender, has been shut since the beginning of the week after the U.S. accused it of engaging in large-scale money laundering for Russian clients.

But then as I go to post, I see that Saturday, euro time, the ECB said ABLV can’t be saved.  It seems their Resolution Board overruled Latvia’s central bank.

Turning to Asia....

In a bold, rare move, China’s government is taking over Anbang Insurance Group Co., owner of New York’s Waldorf Astoria, and will prosecute founder Wu Xiaohui, cementing the downfall of a deal-maker whose aggressive global expansion came to symbolize the financial overreach of China’s debt-laden conglomerates.

[Bloomberg Economics projects that total borrowing, much of it by state-owned enterprises, will exceed 325 percent of GDP by 2022 from 260 percent in 2016.]

Regulators announced they would take over Anbang for a year, remove Wu and charge him with “economic crimes.” Wu, who was the company’s chairman, was detained by authorities in June.

But under Wu, Anbang snapped up trophy assets around the world – sometimes at prices that left observers scratching their heads.

Wu’s links to the Chinese political elite became fodder for media scrutiny with each high-profile acquisition.

So the takeover by the government confirms China’s determination to rein in soaring corporate debt that has accompanied China’s growth.  It also demonstrates that short-term pain economically will be tolerated for the longer-term goal of more sustainable expansion.

But it’s also about reminding not just corporate China, but also multinationals, that when you do business with China, it’s about the Communist Party.

And in the case of the Waldorf Astoria, Hilton Worldwide Holdings, which manages the hotel on behalf of Anbang, is now working for the Chinese government. Isn’t that special?

I have much more on the topic below.

Meanwhile, there was some economic data from Japan, with the flash PMI on manufacturing for February coming in at a solid 54.0 vs. 54.8 in January.

Separately, exports for January rose 12.2% year-on-year, according to the Ministry of Finance, vs. December’s 9.3% clip, while imports rose 7.9%.

Exports to China surged 30.8% yoy, and were up 16% to Asia overall. Exports to the U.S. rose just 1.2%, as car shipments fell 3.9%.

Street Bytes

--For the week, the Dow Jones gained 0.4% on the heels of Friday’s 347-point, 1.4% gain, while the S&P 500 was up 0.6% and Nasdaq 1.4%; the latter two up 1.6% and 1.8% today, respectively. So for the year, the three major indices are solidly in the black again (see below).

--U.S. Treasury Yields

6-mo. 1.84%  2-yr. 2.24%  10-yr. 2.87%  30-yr. 3.16%

The yield on the 2-year is at its highest level since Sept. 2008.

--This week, shares in Amazon hit $1,500 for the first time on Wednesday, after climbing 56% last year, and closed at exactly that level on Friday, up another 28% in the first two months of 2018.

--Shares in Walmart Stores Inc. tanked on Tuesday after the company reported fiscal fourth-quarter profit of $2.17 billion, with adjusted earnings per share coming in four cents light of expectations.

The world’s largest retailer posted revenue of $136.27 billion, up 2.6% for the quarter ended Jan. 31, exceeding the Street, but the company expects full-year earnings to be $4.75 to $5 per share, which is less than analysts’ forecasts.  [Same-store sales also rose 2.6%.]

The biggest reason for the shares tanking 10%, its worst one-day slide since 1988, though, was the realization that the company’s efforts to compete with Amazon online were contributing to a record-low operating margin as Walmart cut prices. What analysts now see is diminished returns from the initiative, with online sales growing less than half the pace last quarter as in the previous three months; 23% vs. more than 50% growth for the previous three quarters, in actuality.

It didn’t help that Walmart misjudged inventory, with goods like TVs and toys flooding their e-commerce warehouses, thus squeezing out room for staples such as toilet paper that it then ran out of, leaving its customers just sitting there, frantically looking for alternatives.  [A problem compounded by the fact people don’t buy magazines like they used to.]

Amazon, according to Bain & Co., continues to increase its market share, capturing half of online spending growth during the holidays. For Walmart, however, as it tries to figure out its online strategy to reach more Amazon loyalists, the expenses are piling up, with the company admitting profits will be squeezed.

The company also said it would no longer offer quarterly profit projections.

--Home Depot reported earnings that were in line with the Street, with revenue of $23.88 billion, up from $22.21 billion, and above forecasts.

Online sales grew 21% in the quarter, but unlike with Walmart, e-commerce hasn’t been a big part of the Home Depot story and the shares were flat while Walmart’s stock swooned.

HD is now forecasting sales growth of 5% at its existing stores in 2018, which is slightly below Wall Street’s forecasts, but still a banner year, compared with most retailers, including Walmart’s 2% growth rate. Home Depot is also forecasting full-year earnings of about $9.30, in line with consensus.

--Toys “R” Us Inc. plans to close another 200 stores and lay off a significant number of corporate staff, after previously announcing it was closing 180 stores, affecting 4,500 workers.  Together, this means the chain will have about half the number of locations as it had before filing for bankruptcy.

Additionally, while employees had previously been told they would receive some severance, the Wall Street Journal is reporting that managers were instructed to tell hourly workers that “there are no severance benefits being provided for the store-closing process.”  Ugh.  In January they had been told they would receive some benefits.

According to research firm AlixPartners, overall in the retail industry there were 7,000 store closures in 2017, many of which resulted from bankruptcy filings.

--Yum! Brands Inc.’s KFC warned that a supply-chain breakdown that has shut more than half of its 900 U.K. outlets would persist for the week, which is really pretty disgraceful.

KFC said it was working with new logistical partner Deutsche Post AG to solve a problem that began over the weekend, leaving only 430 of the 900 with any chicken to cook as of Tuesday. Employees were caught on camera bringing in store bought chickens in one case.  Hell, you’re trying to save your job.

The issue goes back to November when KFC overhauled its U.K. chicken supply chain by replacing logistics provider Bidvest Group Ltd. with Deutsche Post’s DHL, which isn’t necessarily known for delivering food products.

--JPMorgan Chase is going to tear down its Park Ave. headquarters and replace it with one of the tallest towers in New York City, giving a boost to the old business heart of Manhattan. The biggest bank in the U.S. has been mulling a move from its 270 Park Ave. location to the west side of Manhattan, as an anchor tenant of what is known as the Hudson Yards development, but instead it reached an agreement with the city to stay put, consolidating several buildings in the Park Ave. area into one new tower, which will be around 70 to 75 stories, making it the tallest bank building in the country, exceeding Bank of America’s 55-floor tower nearby, as well as BofA’s 60-floor headquarters in Charlotte, N.C.

--Vox Media is laying off about 50 employees, primarily social-video teams at the company’s sites including Racked, Curbed and SB Nation, which total about 5% of Vox Media’s entire staff.

As CEO Jim Bankoff wrote in a memo to employees on Wednesday, the layoffs were promopted by the realization that social-video initiatives won’t be “viable audience or revenue growth drivers” relative to other investments.

--Michael Auslin / Wall Street Journal...Auslin a fellow at the Hoover Institution, Stanford University:

“Mercedes-Benz, the luxury unit of Daimler AG, recently learned the price of crossing Beijing. Earlier this month the German car maker was attacked by state media after posting an anodyne Dalai Lama quote on Instagram. The company quickly and abjectly apologized to the Chinese government. It then went further, promising ‘no support, assistance, aid or help to anyone who intentionally subverts or attempts to subvert China’s sovereignty and territorial integrity.’

“This public humiliation has prompted many companies to ask: How much is it worth to stay in China’s markets?

“Gone are the days when China bided its time, as counseled by Deng Xiaoping. In exchange for continued access to Chinese markets, Beijing increasingly expects Western companies to engage in self-censorship, accept government control over information, and even punish their own workers for offending China.

“Few companies have been willing to stand up for themselves when singled out. In January the American hotel giant Marriott caved in to pressure and temporarily shut down its websites in China. It’s offense? An online questionnaire listed Tibet, Taiwan, Macau and Hong Kong as independent countries. After changing the website, the company’s CEO publicly stated that Marriott ‘respects and supports Chinese sovereignty and its territorial integrity.’ Delta Air Lines, Qantas, Zara and Audi are also fellow travelers in China’s geopolitical strategy.

“Perhaps most concerning, China has taken a particular interest in changing the fundamental way Western technology companies function. Facebook, banned in China since 2009, has worked on a ‘targeted censorship’ tool during its bid to re-enter the country.  Apple agreed to a partnership with a Chinese internet service company, effectively sharing user data with the government. There is no way either company would accept such demands from the U.S. government....

“China’s behavior makes it necessary for Western companies to ask whether the cost of doing business can be too high. Does the profit motive override any responsibility to defend the values of the societies from which they emerged? If only to draw the line against further demands, companies should be reflexively opposed to Beijing’s overreach. Otherwise they should expect the cost of doing business in China to continue to rise.”

Yup, as I’ve written for years, Apple shareholders, for one, are going to be so screwed.

--Separately, Chinese competitors to Apple continue to grab market share in Asia’s biggest markets, from India to Indonesia, as reported by the Journal, with buyers opting for smartphones from the likes of Xiaomi Corp. (“the Apple of China”) – along with BBK Electronics Corp.’s Oppo and Vivo.

China’s manufacturers have become increasingly proficient at knocking off Apple technology at lower prices than the iPhone X, for example, and in some cases are offering better features, such as longer-lasting batteries, that iPhones lack.

The typical smartphone in India or Indonesia sells for under $200.

Because of the $1,000 iPhone X, its revenues grew 11% last quarter in the Asia-Pacific region, even as Apple’s market share was stagnant or declining in most Asian markets.  [Newly Purnell / WSJ]

But Apple’s market share in China is supposedly about 8% today, down from 13% in 2015, according to research firm Canalys.  Apple has just a 2% share in India, and 1% in Indonesia. 

By contrast, Xiaomi is at 19% in India, up from 3% in 2015.

--Andrew Bary of Barron’s has a super piece on General Electric, albeit a depressing one, in the Feb. 19 edition, and while I won’t get into the details, of what a mess its books are, Bary sums it up succinctly.

“If GE is dumped from the Dow industrials, bulls would seize on that as a sign of a bottom. Yet a close look at GE suggests the stock isn’t cheap based on earnings, a sum-of-the-parts analysis, leverage, complexity, and business challenges.  GE’s best days may lie in the past.”  [The stock closed at $14.50 on Friday. After the close, GE, in a filing, said the Justice Department may take action against the company over its now defunct WMC Mortgage Co. unit in connection with the sale of subprime mortgages in 2006 and 2007.]

--CEO compensation at Wall Street’s five-biggest U.S. banks with significant trading and investment-banking operations – JPMorgan Chase, Bank of America, Morgan Stanley, Goldman Sachs, and Citigroup – saw their 2017 compensation increase 17% from 2016, according to SEC filings and the Wall Street Journal.

--Barclays released some startling statistics on its compensation in its annual report Thursday.  If you’re a woman working in investment banking, for example, you’re making about 50% less money than your male colleagues and your bonus is on average nearly 80% lower.

It was the first time a major Wall Street firm detailed its gender-wage gap in such vivid detail.  But more is to come from JPMorgan Chase and Goldman Sachs because under British law, major employers are now required to start reporting how they pay women compared with men.

Previously, the U.S. Department of Labor in January reported median income for women in financial jobs is 31% lower than for men, but one reason for the pay gap is few women hold senior jobs in finance; today just 19%, according to the U.S. Equal Employment Opportunity Commission.

--The Los Angeles Times’ Russ Mitchell had an extensive piece on the problems with the Tesla Model 3. To wit:

“Mark Schey of Morristown, N.J., stepped into his garage a few mornings ago eager to hop inside his shiny new car – the much desired and currently rare Tesla Model 3 electric sedan. The one with the 15-inch touchscreen on the bare-bones dash.

“He flashed his electronic key card to unlatch the door, but nothing happened. He tried the iPhone app, but that didn’t work either.

“There was no way to open the doors. There’s not even a backup metal key. Schey figured he’d need to jump the 12-volt battery needed to power the doors open from the outside.  But the hood was locked shut, too.

“It turns out there’s a wafer-thin plastic cap flush with the front bumper covering a hole the size of a silver dollar.  The Tesla technician sent to Schey’s home reached his fingers in and pulled out two thin cables. He clamped the cables to a portable battery and switched on the juice. The hood popped open. That’s how you jump-start the most high-tech, cutting-edge automobile on the market today.

“And Schey couldn’t be happier.

“ ‘The Tesla service people were great,’ he said.  ‘I see this as growing pains.’”

Too much. They are called Teslarians for a reason.

But it’s not known how pervasive quality problems are, with J.D. Power, the preeminent automobile quality research group, not having been granted access to owner’s information so that a large enough sample of Tesla models can be included in the Vehicle Dependability Study, according to a J.D. Power executive.

All the other major automakers participate in the J.D. Power quality surveys.  [Lexus, Porsche and Buick are on top of the latest rankings.]

Consumer Reports, which ranks reliability through surveys of subscribers, predicted “average” quality for the Model 3 back in October, but didn’t yet have data from Model 3 owners.

--Speaking of Consumer Reports, it issued its 2018 rankings on Thursday, and Hyundai Motor’s luxury Genesis line topped its German rivals to be named 2018’s best car brand in the U.S.

Hyundai bumped Volkswagen AG’s Audi from top billing to the No. 2 spot, with premium mainstays BMW, Toyota Motor Corp.’s Lexus and VW’s Porsche rounding out the top five.

The timing is great for Genesis, which has only two models, as it just sponsored the PGA Tour’s Genesis Open at Riviera, so now you have a lot of folks going, ‘Oh, that’s Genesis,’ and that won’t hurt.

At No. 8, Tesla remained the highest-rated American auto brand, but it doesn’t make the best electric car. That honor went to General Motor Co.’s all-electric Chevy Bolt, which won in the new Compact Green Car category.

CR’s Top Picks List:

Large Car: Chevy Impala.

Compact Car: Toyota Corolla.

Compact Green Car: Chevy Bolt.

Compact SUV: Subaru Forester.

Mid-Sized Car: Toyota Camry.

Full-Sized Pickup: Ford F-150.

Luxury Compact Car: Audi A4.

Luxury Compact SUV: BMW X3.

--An agreement was reached with TK Holdings, Inc., the American subsidiary of Takata, the Japanese company that manufactured faulty air bags, and 44 state governments and the District on Thursday, requiring a $650 million payout by Takata.  Nearly 34 million of the 250 million vehicles on U.S. roads have been part of the largest recall in U.S. history.

--Shares in Snap plummeted back toward their IPO price of $17 after a tweet from reality TV star Kylie Jenner.

Jenner, who boasts a huge fan following, tweeted to her 24.5m Twitter followers: “sooo does anyone else not open Snapchat anymore? Or is it just me...ugh this is so sad.”

Jenner then tried to walk back her initial tweet with a follow-up saying: “still love you tho snap...my first love.”

But Jenner had previously signaled her ambivalence for the app’s redesign, which it first announced in November and recently rolled out.  [The shares ended the week at $17.50, down $3 on the week.]

--A South Korean official who guided Seoul’s regulatory clampdown on bitcoin was found dead last weekend, according to a government spokesman.  The victim, 52, is presumed to have suffered a heart attack, though police were investigating.  Jung Ki-joon had been under heavy pressure in recent months as South Korea looked to tackle cryptocurrency speculation, Yonhap reported.

--I forgot to note last time that former Wynn Resorts CEO and founder, Steve Wynn, is being denied severance, his employment contract having included a $330 million severance stipulation, according to a shareholder lawsuit filed this month.

But the company is providing him with an administrative assistant until the end of May.  Bet that person is terrified.

--The movie “Black Panther,” featuring a primarily black cast, had an opening weekend in the U.S. and Canada of $235 million, a phenomenal success and the first such movie to open to more than $100 million.

The opening was the fifth highest of all time, behind only the last two “Star Wars” sequels, “Jurassic World” and “The Avengers.”

Overseas, the Disney / Marvell Studios picture grossed another $169 million, making it the 25th-highest foreign debut of all time, and this without the Chinese and Japanese markets.

By the way, the previous record-holder for a film featuring a largely black cast, “Straight Outta Compton,” grossed $214 million worldwide in 2015 – over its entire run – after adjusting for inflation.

--Thanks to a relentless news cycle, and a big fan in the Oval Office, Fox News is planning on launching a stand-alone subscription streaming service available without a cable package, which is expected to start by the end of the year. This is Fox’ attempt to keep viewers with the network as they move away from traditional cable and satellite packages at an accelerating pace.

The streaming service will focus primarily on right-leaning commentary, with original shows and cameos by popular personalities like Sean Hannity.

Since Fox by contractual agreements with cable operators cannot have reruns on the streaming service, the network will need to develop hours of new daily programming with a mostly fresh slate of anchors and commentators.

So whereas when I was a kid, I would go to bed with my transistor radio tuned into a New York Knicks game from the west coast, you’ll be able to have Fox running all night in your ear, through your pillow!  Is this a great world or what?

--Margaret Brennan, the senior foreign affairs correspondent for CBS News, will be the next moderator of “Face the Nation.” It had been rumored CBS desperately wanted to tab a woman for the primo gig, and Brennan, 37, is now the only woman currently serving as a solo anchor of a major Sunday political affairs show.  She succeeds John Dickerson, who left after less than three years to replace Charlie Rose on “CBS This Morning.”

Lesley Stahl moderated “Face the Nation” from 1983 to 1991. Christiane Amanpour moderated ABC’s “This Week” from 2010 to 2011.

Martha Raddatz of ABC News was named a co-anchor of “This Week” in 2016, but the program’s branding remains focused on the lead host, George Stephanopoulos.

Brennan, who previously worked at Bloomberg Television and CNBC, before joining CBS News in 2012, said she hoped to offer a dose of civility in a highly charged political moment.  Her business background doesn’t hurt.  You go, Girl!

--ABC News’ flagship “World News Tonight with David Muir” has overtaken “NBC Nightly News with Lester Holt,” for overall audience, while closing the gap in the all-important 25-to-54-year-old demographic, which according to the New York Post has NBC brass beginning to sweat. What’s worse, Brian Williams is surging at his new gig at MSNBC.

Should NBC feel the need to dump Holt, if ratings continued to decline to the terminal stage, it’s too late to move Savannah Guthrie into the slot because she is a huge hit with Hoda Kotb on “Today.” And no way Megyn Kelly would get the gig.

Foreign Affairs

Syria: In a week that has seen devastation and bloodshed on a level as bad as at any time in the Syrian war, more than 400 civilians have been killed since Sunday in unrelenting bombing by Syrian and Russian aircraft in the rebel-held enclave of Eastern Ghouta, a suburb of Damascus.

Friday, Turkey called on Russia and Iran to “stop” the bombardment.  “Russia and Iran must stop the regime,” Turkish Foreign Minister Mevlut Cavusoglu said.

As part of the peace process, using the term loosely, Turkey, Iran and Russia sought to create de-escalation zones across the country, including one for Eastern Ghouta and the rebel-held Idlib province, but Cavusoglu said the regime’s offensive in the enclave as well as in Idlib was “contrary” to the agreements negotiated by the three countries.

German Chancellor Angela Merkel said Friday: “The killing of children, the destruction of hospitals – all that amounts to a massacre that must be condemned and which must be countered with a clear no.”

Among the at least 462 people that have been killed since the intensified bombardment of the besieged area on Feb. 18 are 99 children, according to the Syrian Observatory for Human Rights.  More than 2,000 wounded.

The bombing continued Friday, mostly artillery due to rainy weather.

The UN Security Council was to vote on a resolution, drafted by Sweden and Kuwait, calling for a 30-day ceasefire, the delivery of aid, and the evacuation of the wounded today, but the vote was delayed until noon Saturday by Russia.

All eyes were on Russia to see if it would resort to its veto to block the draft resolution.  A resolution needs nine votes in favor and no vetoes by Russia, China, the U.S., Britain or France. Russia has cast 11 vetoes on possible Security Council action on Syria since its civil war began in 2011.

Thursday, the Kremlin said Russia was not responsible for the civilian deaths in Eastern Ghouta and said it was working with the regime to fight terrorism.

“Those who support the terrorists are responsible,” said Dmitry Peskov,  Putin’s chief spokesman. “Neither Russia, nor Syria, nor Iran are in that category of states as they are waging an absolute war against terrorists in Syria.”

Iran’s deputy foreign minister told the BBC, the situation in Syria is “very complicated.”

“Fear of war is everywhere in our region.”

Abbas Araqchi said Iran’s presence was not aimed at creating a new front against Israel, but to fight terrorism.  He refused to confirm that Iran had sent a drone into Israeli airspace from Syria earlier this month.

A statement from the White House said the U.S. “strongly condemns recent attacks on the people of Eastern Ghouta by Russia and the Assad regime.”

Friday, in a brief press conference, Trump, when asked about the bombing, responded: “I will say what Russia and what Iran and what Syria have done recently is a humanitarian disgrace.”

But then he said the U.S. is in Syria to get rid of ISIS and once that is accomplished, we are out of there.

Separately, Turkey said it would lay siege to Afrin in northern Syria, a month after Ankara launched an offensive against Kurdish militia in the region. The Syrian Observatory says at least 94 civilians have been killed in the Turkish offensive.

Turkey was able to convince Russia, who in turn convinced Syria, not to come to the aid of the Kurds, as was being reported, Turkey saying it would confront the Syrians if this were the case.

Russian Foreign Minister Sergei Lavrov warned the Trump administration not to “play with fire” when it came to U.S. support for the autonomy-seeking Kurds in Syria.

Editorial / Wall Street Journal

“As the carnage in Syria continues, the United Nations is rousing its feeble outrage. But that is no match for Vladimir Putin’s determination to protect his client Bashar Assad.

“The Security Council met Thursday to debate a Swedish and Kuwaiti proposal for a 30-day Syrian ceasefire to stop Assad forces that are pounding rebel strongholds in Eastern Ghouta with an extermination-level bombing campaign. The UN resolution would allow the delivery of humanitarian aid and medical evacuations for the grievously injured, who include women and children....

“One of Assad’s favorite tactics is to bomb hospitals and clinics to inflict as many casualties as possible on local civilian populations.  Medecins San Frontiers reported Wednesday that 13 medical facilities had been hit or damaged since Sunday, ‘preventing medics from obtaining essential life-saving supplies.’....

“Mark this latest fiasco as another case study in what Barack Obama liked to call ‘collective security,’ which at the UN typically means no security at all.”

Raf Sanchez / Daily Telegraph

“The crowd gathered at a makeshift cemetery in Douma, a neighborhood of eastern Ghouta, to say a few brief prayers and bury seven people killed in a bomb blast that morning.

“The mourners separated the corpses – three children, three teenage boys, and one elderly man – with cinder blocks and laid wooden slabs across the blocks to create a new tier for the next set of bodies to come.

“As they began laying the bodies into the earth a jet streaked overhead and fired a rocket into the crowd. Friends and family leapt into the open grave for safety, but when the smoke cleared they counted 11 of their number who had been killed.

“What started as seven deaths had suddenly become 18.”

As the locals say, Assad’s pilots and artillery crews work diligent shifts, beginning their bombardment at around 6 a.m. and silence their guns at midnight, giving the 400,000 trapped residents six hours respite.

Editorial / Wall Street Journal (a separate one)

“Bashar Assad’s Syrian military committed more atrocities this week. ...As everyone deplores the killings, the point to keep in mind is that the driving political power here is Iran and its attempt to make Syria part of its growing Shiite-Persian empire.

“Iran has propped up Assad since the Syrian civil war erupted in 2011, and along with Russia is largely responsible for the regime’s survival.  After its 2016 victory in Aleppo and the ouster of Islamic State from Raqqa, this axis is now trying to roll up the last opposition strongholds.  The trio will then use Russia-sponsored peace talks to re-establish Assad’s control over Syria. Russia will keep its military bases, and Iran wants to establish a new imperial outpost on the border with Israel.

“Toward that end, Iran is building a robust military presence of Islamic Revolutionary Guard Corps (IRGC) troops, Iran-backed Lebanese Hezbollah, foreign fighters from Pakistan, Iraq and Afghanistan, and local Syrian militias in Assad-controlled areas. Iran’s ultimate goal is “the eradication of Israel,” as the leader of the IRGC’s Quds Force, Qasem Soleimani, said recently.

“Military analysts estimate Hezbollah could have more than 100,000 rockets pointed at Israel from its home base in Lebanon and possibly from Syria too. An Iranian redoubt in Syria would open another front in a war with Israel from which to launch more rocket and other attacks.  U.S. National Security Adviser H.R. McMaster worried publicly in December about ‘the prospect of Iran having a proxy army on the borders of Israel.’....

“(Iran) is turning its attention from propping up Assad and toward establishing a more permanent presence in Syria, including the construction of military bases and weapons factories. Iranians are investing in Syria’s local economy to help Assad ‘rebuild,’ and working to convert local Alawites to Shiite Islam.

“Iran is also exploiting a ‘cease-fire’ in southwestern Syria that the U.S. negotiated with Russia last year. Russia is supposed to stop Iran from building up its forces there, but the U.S. has been left to protest feebly as Russia lets Iran continue....

“If the Trump Administration is worried about this gathering storm, you can’t tell from its actions. Secretary of State Rex Tillerson toured the region last week and called for a ‘whole, independent, democratic Syria with no special demarcations dividing Syria and with the Syrian people selecting their leadership through free and fair elections.’ That’s something John Kerry might have said, with a similar lack of credibility with Iran or Russia.

“Mr. Trump promised in October to work with allies to counter Iran’s ‘destabilizing activity and support for terrorist proxies in the region,’ but in Syria the U.S. has shown no strategy for doing so.  Meanwhile, an Iran-Israel conflict grows more likely by the day.”

Prime Minister Benjamin Netanyahu, speaking at the Munich Security Conference, said Israel was prepared to act “not just against Iran’s proxies that are attacking us, but against Iran itself.”

The prime minster held up a piece of the drone Israel recently destroyed, and addressed Iranian Foreign Minister Mohammad Javad Zarif, who was in attendance.

“Do you recognize it? You should, it’s yours. Don’t test us.”

U.S. National Security Adviser H.R. McMaster, also addressing the Munich conference, said Iran is building and arming an increasingly powerful network of proxies in countries like Syria, Yemen and Iraq that can turn against the governments of those states.

“What’s particularly concerning is that this network of proxies is becoming more and more capable, as Iran seeds more and more...destructive weapons into these networks.  So the time is now, we think, to act against Iran,” he said.

Israel: In the ongoing corruption investigation and looming indictments of Prime Minister Netanyahu, a close confidant of the PM is suspected of offering the position of attorney general to an Israeli judge in return for her killing the case into alleged improprieties in Sara Netanyahu’s household spending (just one of the ongoing probes).  Police basically confirmed the report from an Israeli journalist that told of how Netanyahu’s personal spokesperson, Nir Hefetz, offered Hila Gerstel, a retired judge, the position of AG on the condition she would close the case against the prime minister’s wife.  Netanyahu denied the story.

Meanwhile, another confidant of Netanyahu, Shlomo Filber, who was arrested by the police in an investigation into the ties of Israel’s telecom giant with government officials, reached a deal with the police this week to turn state’s evidence.  Accordingly, Filber will incriminate Netanyahu in exchange for a lighter sentence.

A poll by Channel 2 showed that 45% of Israelis believe Netanyahu should resign even before the attorney general decides whether to indict, versus 40% who said he should not.

On a different issue, the United States is expected to move Israel’s embassy to Jerusalem on May 14, known as Israel Independence Day. Who will be prime minister then?

Iraq: We continue to be told that ISIS has been basically eliminated from Iraq and Syria, but Islamic State militants ambushed a group of Iraq’s Shiite-led paramilitary fighters on Monday, killing at least 27 in an area southwest of Kirkuk.

North Korea: Even before the Olympic Games ended, the U.S. said it was imposing its largest package of sanctions against North Korea on Friday, intensifying pressure on Pyongyang to give up its nuclear and missile programs. The U.S. Treasury is sanctioning one person, 27 companies and 28 ships; actions that block assets held by the firms in the United States and prohibit U.S. citizens from dealing with them.

The measures are designed to disrupt North Korean shipping and trading companies and vessels and to further isolate Pyongyang.  Sanctions against the ships would help prevent Kim’s government from conducting “evasive maritime activities that facilitate illicit coal and fuel transports and erode its abilities to ship goods through international waters,” according to Treasury Sec. Steve Mnuchin.  Washington has been talking to regional partners, including Japan, South Korea, Australia and Singapore, about coordinating a stepped-up crackdown that would go further than ever before.

Separately, according to security and intelligence officials, both the U.S. and North Korea are planning sophisticated cyberattacks against each other, with Pyongyang stepping up its cyber capabilities to target international aerospace and defense industries through a hacker group called Reaper, or APT37, which has been identified by an American private security company that tracks cyber attackers around the world.

North Korea is using malware to infiltrate computer networks.

As for Washington, its potential plans for a series of “bloody nose” strikes on targets in North Korea could be more of the cyber kind rather than conventional warfare.

It is thought Pyongyang has a cyber army of 6,000 hackers, set up under the guise of agency Bureau 121 to plunder international banks, conduct military espionage and attack critical infrastructure.

FireEye has been monitoring APT37 since 2012 and said it is “expanding in scope and sophistication.” [Nicola Smith / Irish Independent]

We also learned this week that Vice President Mike Pence was to meet with North Korean officials while in South Korea at the PyeongChang Games, but on Saturday Feb. 10, less than two hours before Pence and his team were to meet with Kim Yo-jung, the younger sister of leader Kim Jong-un, the North Koreans pulled out of the meeting, according to Pence’s office.

As for a summit between the two Koreas after the Games, South Korean President Moon Jae-in reiterated that while his government’s goal is to ease tensions, and North Korea’s participation helped at least temporarily, the possibility of a North-South summit taking place “is like looking for scorched-rice water at a stone well,” Moon said, referencing a Korean proverb similar to seeking hot water under ice.

Moon added: “I hope the dialog that’s currently taking place between South and North Korea will lead to U.S.-North Korea talks  and then to denuclearization.”

Ivanka looked perky today when she arrived in Seoul.

Russia: Anne Applebaum / Washington Post

“For most Americans, the Parkland shooting was a terrible tragedy. But for social media accounts that promote the interests of Russia in the United States, it was a fantastic opportunity.

“On the morning after the tragedy, the Russia-linked accounts were commenting fiercely, pushing the ‘crazy lone killer’ explanation for the shooting and mocking advocates of gun control. According to Hamilton 68, a tracker website created by the German Marshall Fund, a lot of them linked to photos of guns and ammunition on the Instagram account of the suspected killer, plus a screenshot of a Google search for ‘Allahu akbar.’ Others linked to a fact-checking website that debunked some statistics about gun crime. By Friday morning, some of the same accounts were also pushing something slightly different: the hashtag #falseflag. That’s a reference to the conspiracy theory, already widespread 48 hours later, that the shooting never happened, that the attack is a ‘false flag’ operation staged by the U.S. government as a prelude to the seizure of guns. And this is just the beginning.  Over the next few days, many of these same kinds of accounts will invent a whole range of conspiracy theories about the shooting. If the past repeats itself, pro-Russian, alt-right, white-supremacist and pro-gun social media accounts will promote the same hashtags and indulge in the same conspiracy theories.  Each group has its own interests in pushing #falseflag, but the Russian interest is clear. They do it because it helps undermine trust in institutions – the police, the FBI, the media – as well as in the government itself.  They also do it because it helps to amplify extremist views that will deepen polarization in U.S. political life and create ever angrier, ever more partisan divides....

“Despite what is now overwhelming evidence of Russia involvement in the last U.S. presidential election, no one at the highest level of the U.S. government has made a significant commitment to prevent Russian involvement in the next election, or the next debate, or the next national argument, either. Trump continues to regard Russian intervention as a ‘hoax.’ Trump’s aides and lieutenants have refused to spend any time or political capital on finding solutions....Remember all of that over the next few days as you read the indictment of the Russian Internet team, along with the commentary – because the same tactics, the same games, are already in use once again.”

Separately, with the March 18 presidential election looming, opposition leader Alexei Navalny has been detained and charged with violating public assembly laws.

“I got a toothache, I went to the dentist. Stepped out of the dentist – ‘Hello [...] you are being detained.’ They’re taking me somewhere,” Navalny tweeted on Thursday.

He followed up minutes later, saying authorities charged him with an administrative violation of public assembly rules – a charge that carries a maximum sentence of 30 days – before releasing him.

“I was released until the trial. It’s unclear when the trial will take place,” Navalny wrote.

This is beyond pathetic.  Don’t expect President Trump to tweet about it.

Brazil: The military is taking over public security in Rio de Janeiro until the end of the year as the country struggles with surging violence in the city. An Army general will now report directly to President Michel Temer, as Rio saw 2,125 violent deaths last year, a 37% increase since 2014, including several cases of children being killed by stray bullets. This year’s Carnival festivities were marred by gun battles and mass robberies.  Yikes.

Random Musings

--Presidential tracking polls....

Gallup: 37% approval of Trump’s job performance, 59% disapproval [2/18]
Rasmussen:  50% approval, 49% disapproval [highest approval rating since mid-June]

A new Quinnipiac University poll gave President Trump a 37% approval rating, 58% disapproval, compared to a 40-55 split February 7, in the wake of his State of the Union address. [Republicans: 86-10; Democrats: 3-96; Independents 37-57; Men: 45-51; Women 30-65.]

American voters say 53-38 percent, including 47-36 among Independent voters, they want the Democratic Party to win control of the House, which is back to the margins of a few months ago after the gap had closed to basically zero.

--In a highly significant move in terms of the November elections and the effort of the Democrats to retake the House, Pennsylvania’s Supreme Court imposed a new congressional map that gives Democrats the potential to flip at least four Republican-held seats, according to an analysis from the Cook Political report.

The state high court had ruled that Republicans had unlawfully redrawn the state’s districts to maximize GOP gains.  So a new map was put together with fresh district boundaries.

This is big. Republicans hold a 12-5 edge in the state’s congressional delegation, with a special election to fill the seat of Republican Rep. Tim Murphy scheduled for March 13. 

Editorial / Wall Street Journal

“Political chaos has broken out in Pennsylvania after the state’s high court last week redrew the congressional map for this year’s midterm elections. Behold our future judicial overlords if the U.S. Supreme Court rules that partisan gerrymanders are unconstitutional.

“Last month a 5-2 liberal majority of the Pennsylvania Supreme Court struck down, with unvarnished political hubris, the congressional map adopted by the GOP legislature way back in 2011. The districts ‘clearly, plainly and palpably violate our state Constitution’ that guarantees that ‘elections shall be free and equal,’ the judges opined.

“According to the majority, the gerrymander diluted the voting rights of some Democrats by cramming them into a handful of districts. As evidence, the judges noted that in 2012 Democrats won five of 18 congressional districts with an average 76.4% of the vote in each while receiving 50.8% of the statewide vote. The judges also emphasized that Republicans haven’t lost a district since 2011, yet the special election next month in southwestern Pennsylvania for Rep. Tim Murphy’s seat is competitive. So was the race in November to replace Republican Patrick Meehan in Philadelphia’s suburbs.

“While the U.S. Supreme Court has held that partisan gerrymanders may violate the U.S. Constitution, it has been unable to articulate a precise legal standard.  Democrats are now trying to tempt the Supreme Court into intervening in the intrinsically political redistricting process with social-science methodology that purportedly measures proper representation....

“Pennsylvania’s constitution gives the legislature plenary authority to draft congressional maps.  Nonetheless, the Democratic majority on the high court – judges in Pennsylvania are elected – gave the legislature all of three weeks to redraw districts that would meet Democratic Governor Tom Wolf’s approval.

“The judges specified that the districts must have equal populations, be ‘compact and contiguous geographical territory’ and respect ‘the boundaries of existing political subdivisions contained therein.’ These requirements are nowhere in the state constitution.

“Notably, the judges did not articulate a precise standard for reviewing partisan gerrymanders. It’s possible for the legislature to draw a map complying with the court’s ‘neutral criteria,’ the majority wrote, but that still could ‘unfairly dilute the power of a particular group’s vote for a congressional representative.’ In other words, the judges can do what they want.

“And with the help of Stanford University law professor Nathan Persily they drafted their own new map Monday for use in the May primaries after the Governor and legislature failed to agree.  The revised map makes at least three GOP districts more competitive and disrupts several races....

“State judges can’t usurp the legislature’s authority over redistricting willy-nilly.  The Supreme Court ought to block this judicial coup d’etat, but be warned.  Pennsylvania will be the future in every state if the Justices decide that judges should be redistricting kings.”

--President Trump endorsed Mitt Romney in Utah’s Senate race, another sign the two are trying to bury the hatchet. Romney announced he was seeking the nomination to replace retiring Sen. Orrin Hatch and in a tweet Monday night, Trump wrote, “He will make a great Senator and worthy successor to @OrrinHatch, and has my full support and endorsement!”  Romney quickly accepted the endorsement via Twitter.

Editorial / Wall Street Journal

“Mitt Romney announced Friday that he’s running for the U.S. Senate from Utah, and the timing on the same day as the Justice Department indictments of Russians for meddling in the U.S. presidential election was apt. Mr. Romney was right about the Russian threat in 2012, and Democrats who are now echoing him when it serves their political purposes against Donald Trump owe the former GOP presidential nominee an apology.

“Start with Barack Obama, who derided Mr. Romney’s claim that Russia was a major U.S. geopolitical foe in the third presidential debate in 2012.  ‘The 1980s are now calling to ask for their foreign policy back because the Cold War’s been over for 20 years,’ Mr. Obama said, to applause from the Democratic media establishment.  In its endorsement of Mr. Obama, the Washington Post criticized Mr. Romney for ‘calling Russia America’s greatest foe’ as an example of his lack of judgment.

“Readers may recall that Mr. Romney made his comments about Russia after Mr. Obama was caught unaware talking on an open microphone with then Russian President Dmitry Medvedev in March 2012:

“ ‘On all these issues, but particularly missile defense, this, this can be solved, but it’s important to give me space,’ Mr. Obama told Mr. Medvedev, the Vladimir Putin stand-in.

“ ‘Yeah, I understand,’ Mr. Medvedev said.

“Mr. Obama then said, ‘This is my last election. After my election, I have more flexibility.’

“Mr. Medvedev: ‘I understand. I will transmit this information to Vladimir.’”

“The ‘flexibility’ after Mr. Obama’s election turned out to be Mr. Putin’s as he invaded and annexed Crimea, started a war to occupy the Donbas region in Ukraine, intervened to prop up Bashar Assad in Syria, covered for Assad’s use of chemical weapons, and helped North Korea evade United Nations sanctions.

“Thanks to last week’s indictments, we also know that Mr. Putin’s attempt to meddle in U.S. elections began in 2014, long before Mr. Trump chose to run for President. That interference went unopposed, and as far as we can tell, unanticipated by Mr. Obama, his CIA Director John Brennan and his Director of National Intelligence James Clapper until nearly the end of Mr. Obama’s second term. They did nothing about it until after Hillary Clinton lost....

“Mr. Romney is expected to win the Utah seat with ease, which should make him available to instruct Democrats on foreign affairs.”

--Outgoing Republican Rep. Ileana Ros-Lehtinen (Fla.) said on CBS’ “Face the Nation” that it would be “foolish” for the GOP not to realize that it’s “heading into trouble” in the next election.

Ros-Lehtinen noted that “few women” are running for office as Republicans.  “Far greater numbers of women are identifying themselves as being in the Democratic party,” she said, adding, “I don’t see that we really have a recruiting program that’s active to get minorities involved in our party” as well.

Ros-Lehtinen decried that the growth of the GOP “seems to be very limited in a specific group,” which is idiotic (that’s me), because as the congresswoman noted, “the demographics of our great country is changing greatly.”

--The aforementioned Quinnipiac University poll also asked American voters whether President Trump should publicly release his tax returns and by a 67-24 percent margin, the answer is ‘yes.’ By 61-30 they do not like him as a person.

Also, American voters by a 76-18 margin, including 55-35 percent among Republicans, that the Russian government did try to influence the 2016 presidential election, the highest number so far for this question.

--Survivors of the shooting at Marjory Stoneman Douglas HS in Parkland grilled lawmakers and National Rifle Association spokeswoman Dana Loesch in a raucous meeting sponsored and aired by CNN Wednesday.

“Your comments this week and those of our president have been pathetically weak,” parent Fred Guttenberg, whose 14-year-old daughter Jamie was among the 17 killed, told Sen. Marco Rubio.

“Look at me and tell me guns were the factor in the hunting of our kids in school and look at me and tell me you accept it and you will work with us to do something about guns.”

Rubio said the killings “cannot be solved by gun laws alone,” which drew jeers from the crowd, but he pointed out where he disagreed with the NRA – such as his desire to lift the legal age of rifle purchases from 18 to 21.  Rubio also said he supports improving background checks and banning bump stocks.

But Rubio said he’s “not comfortable” with arming teachers, as President Trump suggested earlier in the day.

Douglas student Cameron Kasky put Rubio on the spot by asking if he’s willing to stop accepting campaign contributions from the NRA.

“Sen. Rubio can you tell me right now that you will not accept a single donation from the NRA?” Kasky asked.

Rubio answered by saying he can justify his acceptance of NRA money because “people buy into my agenda.”

Kasky refused to accept that answer: “In the name of 17 people, you cannot ask the NRA to keep their money out of your campaign?”

Rubio responded: “I think in the name of 17 people I can pledge to you that I will support any law that will prevent a killer like this from getting a gun.

“I will do what I think is right. They buy into my ideas, I don’t buy into theirs.”

I was going to say all kinds of things about our new student activists, but I’ve learned to hold off on totally speaking my mind. I’m the ‘wait 24 hours’ guy after all.

But I do admit to thinking when the students of Marjory Stoneman Douglas High first emerged, ‘Boy, this isn’t going to end well.  They’re out over their skis.’

There are already three kids I don’t like, and it’s sad that some of them are already being blistered on social media. 

But if they help bring about positive change, that’s terrific. I wish them well.

--Missouri Republican Gov. Eric Greitens was indicted by a St. Louis grand jury Thursday for invasion of privacy stemming from a 2015 extramarital affair.

Greitens, a former Navy SEAL, admitted earlier this year to cheating on his wife after a local news station released recordings of the woman describing a sexual relationship with the governor.

The indictment states that Greitens knowingly photographed the unnamed victim in partial or full nudity without her knowledge and consent.

Greitens said he wouldn’t resign. What a dirtball.

--The survey of American presidents, as put out by Brandon Rottinghaus and Justin S. Vaughn, tallying the opinions of 170 members of the American Political Science Association’s Presidents and Executive Politics section, is beyond stupid.  It ranks President Trump last, after one year where he was as consequential as any president of the modern era, and if you’re using the one-year lens, there is no way he is close to worst.

His behavior is as bad as any, but the record thus far in terms of the U.S. economy is good.

You can’t dignify a survey giving a president a grade after just one year....period. That’s scholarship?  C’mon...the Washington Post and New York Times, among others, should never have published it.

After four years, it’s fair to begin ranking Trump.  End of story.

Having said that, the consensus of the 170 is:

1. Lincoln
2. Washington
3. FDR
4. Teddy Roosevelt
5. Jefferson
6. Truman
7. Eisenhower
8. Obama!
9. Reagan
10. LBJ

Barack Obama should be in the bottom five, as I said over the years, and once historians fully understand what transpired in 2012, as noted above, he’ll be down with James Buchanan.  I also believe George W. Bush is bottom five.  And I suspect I won’t be judging Trump very kindly.

But what really ticks me off with this ranking is James Polk at No. 20.  The guy is anywhere from 8 to 10.

[LBJ at 10 is another joke.]

For the record, Dems in the survey had Obama No. 6, Independents No. 12, and Republicans No. 16, further disproving this crappy piece of work.

But even Republicans in the survey of 170 had Trump at 40 (Polk at 13).

--We note the passing of Jeffrey Bell, 74, a conservative theorist who long ago shook things up in my home state of New Jersey, upsetting liberal fellow Republican, Sen. Clifford Case, in 1978 when Bell was only 34 years old.  A lot of us thought this was a rising superstar, even after his loss in the ’78 general election to the Democrat, Bill Bradley, but while Bell lost two other Senate bids, he made his mark on economic and social issues inside the party apparatus and played an important role in establishing the Reagan agenda and massive tax cuts.

Bill Bradley said this week: “You learn a lot about somebody when he’s your opponent.  Jeff was a man of ideas, he was a man of principle, and he never took a cheap shot. Later, when I became an advocate for tax reform – closing loopholes and lowering rates – Jeff became a real ally.”

Conservatives rank Bell with Representative Jack Kemp, along with the Wall Street Journal’s Jude Wanniski and Robert L. Bartley, as the top figures in the emergence of ‘supply-side economics.’

In an obituary, the Journal lauded Bell for his “cheerful populism in the Reagan and Kemp mode.” Despite his electoral defeats, the editorial said, “his ideas over a lifetime were more influential in shaping American politics than those of nearly all senators.”

Bell served as national campaign coordinator for Kemp’s presidential primary campaign in 1988, after which he was president of an economic and political consulting company in Arlington, Va., which became known as Lehrman Bell Mueller Cannon.

--A USA TODAY analysis of crime data for 2017 found that for America’s 50 biggest cities, the homicide rate dipped slightly, though this was an improvement over FBI data that showed back-to-back years in which homicides rose sharply in large cities.  (Homicides in cities with 250,000 or more residents rose by about 15.2% from 2014 to 2015, and 8.2% from 2015 to 2016.)

In 2017 there were 5,738 homicides in the nation’s 50 biggest cities compared with 5,863 in 2016, a roughly 2.3% reduction.  But it is really a 1.1% reduction because Las Vegas police didn’t include the Oct. 1 mass shooting that left 58 dead in their tally.

The national decrease in killings in 2017 was largely driven by double-digit percentage dips in some of the biggest cities, including Chicago (14.7%), New York City (13.4%) and Houston (11%).

--According to a study carried out by marine scientists at NUI, Galway, 73 percent of the monitored deep water fish from the Northwest Atlantic Ocean had ingested plastic particles – one of the highest frequencies of microplastic in fish worldwide.  The Marine Institute’s Celtic Explorer research vessel took dead deep sea fish from midwater trawls in the area.

--Talk about crazy weather.  In the New York area, we smashed all-time high temperature records on Wednesday. It hit 77 where I live, like 8 degrees over the record, but in the San Joaquin Valley of California it was in the mid-20s on Tuesday morning, which threatened the almond and cherry crops.

I saw where the polar vortex split in two, which is pretty rare, with half going to Europe, where it has indeed been unseasonably cold, and the other half to the western U.S.

And that’s your national and world weather update for Friday.  Good luck to our friends in the Midwest with the flooding.

--The great Billy Graham died on Wednesday.  He was 99. 

Graham was the most dominant American pastor of the second half of the 20th century, counseling nine president, filling stadiums and lifting his evangelism into the religious mainstream.

Former President Jimmy Carter said in a tweet: “Tirelessly spreading a message of fellowship and hope, he shaped the spiritual lives of tens of millions of people worldwide.  Broad-minded, forgiving, and humble in his treatment of others, he exemplified the life of Jesus Christ by constantly reaching out for opportunities to serve.”

Billy Graham began preaching to the masses after World War II, and as one biographer noted, he did not hide behind a pulpit. He “stalked and sometimes almost ran from one end of the platform to the other,” while beseeching unbelievers to give themselves to the higher power he praised with unassailable conviction.

It’s hard to imagine how Graham drew 350,000 people to a tent in downtown Los Angeles over eight weeks in 1949 – the first major Billy Graham crusade.  When it ended, 65 sermons later, he was known throughout the country, and not too long after, throughout the world.

Over his career, Graham preached to nearly 215 million people in more than 185 countries and territories, according to figures compiled by the Billy Graham Evangelistic Assn., and was heard and seen by hundreds of millions more through television and radio, newspaper columns and later the internet.

It is with good reason that Graham and the pope were the two best-known figures in the Christian world.

Graham attended or participated in eight presidential inaugurations, and was present at the White House during some of the darkest hours. He stayed close to Lyndon Johnson when his popularity was plummeting because of the Vietnam War, and he supported Richard Nixon for longer than most thought prudent.  He forgave President Clinton during the Monica Lewinsky scandal and counseled Hillary to do the same.

And when Ronald Reagan was first diagnosed with Alzheimer’s, Rev. Graham was one of the few allowed to visit the former president in California. Graham was so well liked, he participated in the Bush family’s retreats in Kennebunkport.  Graham influenced George W. Bush’s turn in religion.

Editorial / Washington Post

“America has been heavily influenced, even shaped, by its preachers, from Jonathan Edwards to Henry Ward Beecher and the televangelists of today. Some fostered great and needed social change (Northern Protestant churchmen and women created the abolition movement); others sought to impose their will on a dubious nation (as in Prohibition).  A few were frauds or hypocrites and were eventually discredited. But through a half-century and more, Mr. Graham maintained his standing....

“Mr. Graham kept his message relatively simple, which may be one reason it endured. He was never a great hero of the political left or right, though he took a stand fairly early in this country’s civil rights movement against segregation, and spoke often, if somewhat vaguely, on the need for social justice....

“When he was young, Mr. Graham had a close relationship with Charles Templeton, a fellow evangelist. The two eventually parted ways, with Mr. Templeton going on to what he saw as a more intellectual and skeptical view of religion.  Many years later, Mr. Templeton recalled of his old friend, ‘I disagree with him profoundly on his view of Christianity and think that much of what he says in the pulpit is puerile nonsense. But there is no feigning in him: he believes what he believes with an invincible  innocence. He is the only mass evangelist I would trust. And I miss him.’”

Editorial / Wall Street Journal

“When Graham brought his crusade to England in 1954, for example, he attracted 120,000 people to Wembley Stadium – at the time the largest religious gathering ever in the British Isles, and he gained an admired in a young Queen Elizabeth.  Later he would take the Gospel into some of the earth’s most aggressively atheist regimes, including North Korea.

“What message proved to be so attractive? At a 1954 press conference in London, Graham explained his approach: ‘I am going to preach a gospel not of despair but of hope – hope for the individual, for society and for the world.’

“In preaching this Christian hope of salvation, Graham gave the world a new image of the evangelical Christian. Rather than try to convert Catholics, for example, Graham sent them back to make peace with their own churches as he did with other Christian denominations. In the 1950s he insisted that his revivals be racially integrated, and he invited a fellow minister named Martin Luther King to give the opening prayer at his crusade at Madison Square Garden....

“The West in general, including the U.S., has become far more secular than in Graham’s heyday, and it is hard to imagine another man of faith enjoying the same prominence and influence today. America’s largely secular media also seem to revel in demonstrating that anyone prominent in religious life is a fallen idol.

“Then again, Billy Graham knew that if the hope and salvation he preached found a welcome reception in people’s hearts, it wasn’t because of the charm or charisma of the messenger.  It was because of the power of the message.”

---

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

God bless America.

---

Gold $1330
Oil $63.57...nice two-week rebound off $59

Returns for the week 2/19-2/23

Dow Jones  +0.4%  [25309]
S&P 500  +0.6%  [2747]
S&P MidCap  +0.2%
Russell 2000  +0.4%
Nasdaq  +1.4%  [7337]

Returns for the period 1/1/18-2/23/18

Dow Jones  +2.4%
S&P 500  +2.8%
S&P MidCap  +0.2%
Russell 2000  +0.9%
Nasdaq  +6.3%

Bulls 48.5...huge drop from 66 in three weeks
Bears 14.6 [Source: Investors Intelligence]

Have a great week.

Brian Trumbore