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Week in Review

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11/21/2020

For the week 11/16-11/20

[Posted 10:00 PM ET, Friday]

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Edition 1,127

The crazy elements are going to have to be suppressed with common sense.”

--Rep. Denver Riggleman (R-Va.)

I am both furious and depressed tonight.

Furious at President Trump for his all-out assault on our democracy, and depressed that a solid core of about 40% of Americans actually believe the garbage being spouted by the president and his enablers.

I have been doing this column for 23 years this month, if you include when I started it at PIMCO Funds, November 1997, as PIMCO was putting together their web site.  They knew of my interest in geopolitics, as well as global financial markets, and all these years later the assault on the truth is beyond my comprehension.

I never suffered fools gladly and I never countenanced such behavior.  Not once have I ever parroted a conspiracy theory and I’m incredulous that some otherwise highly-educated Americans seem okay with a leader who is willingly undermining confidence in democracy and free elections.  President Trump contacting Michigan state Republicans to attempt to change the results of an election?  Really?

I was reading a piece from Reuters today about Trump’s supporters in the little town of Sundown, Texas, near Lubbock.  One fellow, Brett F., 50, describes himself as a middle-class Republican.  He owns a small business and has a master’s degree.

At first, in 2016, he voted for Ted Cruz, but today “would go to war for Trump,” as the Reuters story goes.

He has joined the newly formed South Plains Patriots, a group of a few hundred members that includes a “reactionary” force of about three dozen – including Brett and his son – who conduct firearms training.  Nothing will convince Brett and many others in Sundown that Democrat Joe Biden won the Nov. 3 presidential election fairly.  They believe Trump’s stream of election-fraud allegations and say they’re preparing for the possibility of a “civil war” with the American political left.

“If President Trump comes out and says: ‘Guys, I have irrefutable proof of fraud, the courts won’t listen, and I’m now calling on Americans to take up arms,’ we would go,” said Brett.

These are the kinds of attitudes expressed down below in some of the polling data I pass on.

But such troubling talk as that expressed by Brett F. is just an extension of the likes of America’s Clown, Rudy Giuliani, who, during a bizarre press conference Thursday that lasted over 1 1/2 hours, sweated so profusely his hair dye was streaming down both sides of his face.

Giuliani spent his time pushing the completely unfounded claim that Democratic officials used mail-in ballots to rig the election against Trump.

“This is real!  It is not made up!” Giuliani ranted.

But the slimy former mayor, at one time a hero in the aftermath of 9/11, brought matters to a new low as he accused Joe Biden himself of crimes.

“He doesn’t get asked questions about all the evidence of the crimes that he committed,” Giuliani said without explaining what crimes Biden supposedly was involved in.

“What’s going on in this country is horrible,” he added.

Sidney Powell, another member of Trump’s legal team, piled on by falsely claiming the president won the election.

“President Trump won by a landslide,” she said.  “We are going to prove it and we are going to reclaim the United States of America.”

Giuliani repeatedly insisted in the press conference that the campaign’s lawsuits are packed with evidence of Democratic voter fraud.

“All you’ve got to do to find out if I’m misleading you at all is to look at the lawsuit,” he said.

However, Giuliani sang a different tune when pressed under oath by a federal Pennsylvania judge earlier this week on the specifics of a lawsuit filed by the campaign.  “This is not a fraud case,” Giuliani admitted during the hearing.

Chris Krebs, the U.S. government’s top cybersecurity official who was fired by Trump earlier this week after publicly debunking Il Duce’s false fraud claims about the election (more on him below), tweeted:

“That press conference was the most dangerous 1hr 45 minutes of television in American history.  And possibly the craziest.  If you don’t know what I’m talking about, you’re lucky.”

Only a few Republicans have had the guts thus far to step forward and tell the truth.

Sen. Mitt Romney (R-Utah):

“Having failed to make even a plausible case of widespread fraud or conspiracy before any court of law, the President has now resorted to overt pressure on state and local officials to subvert the will of the people and overturn the election.  It is difficult to imagine a worse, more undemocratic action by a sitting American President.”

Sen. Ben Sasse (R-Neb.):

“What matters most at this stage is not the latest press conference or tweet, but what the president’s lawyers are actually saying in court. And based on what I’ve read in their filings, when Trump campaign lawyers have stood before courts under oath, they have repeatedly refused to actually allege grand fraud – because there are legal consequences for lying to judges.”

“We are a nation of laws, not tweets,” Sasse added.

Historian Michael Beschloss:

“We have never seen anything like this before.  This is a president abusing his very great powers to try to stay in office, even though it is obvious to everyone that he has been defeated in the polls.  That is a prospect that terrified most of the founders.”

In an interview with the Washington Post, Beschloss added, “I don’t want to be alarmist, but I do think it’s our job as citizens to keep watch on every one of these things with an eye to that ultimate dread of the founders, which is that a president rejected by the voters would use his powers to try to stay in office anyway.”

Wall Street is starting to get concerned.

Michael Cembalest, chairman of market and investment strategy at JPMorgan Asset Management, warned in a report Wednesday of the “remote risk of an American horror story” and “constitutional mayhem.”

---

Meanwhile, the General Services Administration, the government agency in charge of managing operations of the federal government, has not yet given an “ascertainment” of the election results, at the direction of President Trump, and without the GSA certification, the Biden administration cannot begin a formal transition process, which normally includes the outgoing and incoming administrations coordinating on the operations and infrastructure of the federal government.

It’s bad enough that President Trump is doing his best to delegitimize the Biden presidency before it’s even started, but we’re in the midst of a freakin’ pandemic!  Trump’s lack of cooperation on Covid, as cases and deaths skyrocket, is yet another dereliction of duty.

Remember how as the campaign was winding down, Trump kept saying, “As of Nov. 4, the Fake News Media won’t be saying anything about the coronavirus”?

As of Nov. 4, the pandemic has hit its costliest phase and it’s the president himself who literally has not said a single word on Covid-19 unless it was about vaccines.  Not one word. The healthcare system is breaking down, deaths are mounting, and not one word of empathy from Trump…not one.  What a disgraceful, pathetic man.

Joe Biden said this week that the lack of coordination with the Trump administration related to the coronavirus and issues such as the distribution of the coming vaccines was the biggest threat facing his transition.

It’s criminal. 

On Thursday, the Centers for Disease Control and Prevention said it recommends Americans do not travel during the Thanksgiving holiday next week to mitigate the spread.  The travel recommendation is a “strong recommendation,” not a requirement, CDC official Henry Walke said on a call with reporters Thursday.

“We’re alarmed with the exponential increase in cases, hospitalizations, and deaths,” Walke said.

But one who is not concerned is South Dakota Republican Gov. Kristi Noem, the sexy enchantress, aka Circe, who is hellbent on inheriting Trump’s base in 2024 and running for president.

Those who don’t wear masks are making a “personal decision” that deserves respect, she said during a news conference Wednesday.  She refused to encourage people to wear masks or socially distance, instead saying the best thing people can do to stop the spread of the virus is wash their hands.

It was Noem’s first news conference to address the pandemic in over three months.  Meanwhile, doctors in the state strongly support a mask mandate.

It kills me how you say “mask mandate” and some immediately start wanting to riot…you are taking away our rights!  We won’t accept a lockdown!

We aren’t calling for lockdowns or taking away your rights, you idiots.  Just wear a freakin’ mask indoors when around people.  That’s an egregious sacrifice?!

William McRaven’s Seal Team Six went in blind to take out Osama bin Laden and you can’t wear a mask?

Your grandfather stormed the beaches of Normandy, not knowing if he’d even make it to land, and you can’t wear a mask?

There are 22 units in my building and I’m one of five originals, still here after eleven years.  One of the five is a Russian family on the floor below me.  When I see them in the parking garage or the elevator, the father is friendly enough and I know he likes to go cycling around the area so we small talk about the weather and if he’s gotten out recently, and so this week I see him on the elevator, and of course I have my mask on, and he’s not wearing one, and when I asked if he was riding his bike these days, he said he had gotten a Nordic Track.

“That’s safer,” I said, meaning safer than riding a bike on our busy streets.

Well, the guy misinterpreted me, thinking I was making a Covid comment, and he goes, in his heavy accent, “I don’t agree with mask mandates.”

‘Oh brother,’ I mused.

More Election Fallout…

In keeping with my opening, according to a Reuters/Ipsos poll from Tuesday, about half of all Republicans believe President Trump “rightfully won” the election but that it was stolen from him by widespread voter fraud that favored Joe Biden.

The Nov. 13-17 poll showed that Trump’s open defiance of Biden’s victory in both the popular vote and Electoral College appears to be affecting the public’s confidence in American democracy, especially among Republicans.

Altogether, 73% of those polled agreed that Biden won the election while 5% thought Trump won.  But when asked specifically whether Biden had “rightfully won,” Republicans showed they were suspicious about how Biden’s victory was obtained.

Fifty-two percent of Republicans said that Trump “rightfully won,” while only 29% said that Biden had rightfully won.

Asked why, Republicans were much more concerned than others that state vote counters had tipped the result toward Biden: 68% of Republicans said they were concerned that the election was “rigged,” while only 16% of Democrats and one-third of independents were similarly worried.

Even before winning the 2016 election, Trump kept up a drumbeat of complaints about the process, claiming without evidence that it was unfair to him.

Altogether, 55% of adults in the United States said they believed the Nov. 3 presidential election was “legitimate and accurate,” which is down 7 points from a similar poll that ran shortly after the 2016 election. The 28% who said they thought the election was “the result of illegal voting or election rigging” is up 12 points from four years ago.

The poll showed Republicans were much more likely to be suspicious of Trump’s loss this year than Democrats were when Hillary Clinton lost four years ago.

In 2016, 52% of Democrats said Clinton’s loss was “legitimate and accurate,” even as reports emerged of Russian attempts to influence the outcome. This year, only 26% of Republicans said they thought Trump’s loss was similarly legitimate.

A Monmouth University poll revealed a third of the country is “happy” that Donald Trump lost the election – which is slightly more than the one-quarter who feels the same about Joe Biden winning.  The poll also finds a majority of Americans are confident that the election was conducted fairly, although most Trump voters think Biden’s victory is due to voter fraud.  The president’s refusal to concede may also contribute to the fact that more than 4 in 10 Americans feel we need more information about the vote count before we can be certain of the election’s outcome.

Overall, just half of the American public is either happy (34%) or satisfied (18%) about Trump’s defeat, while nearly 4 in 10 are dissatisfied (28%) or angry (10%).  Likewise, just over half are either happy (25%) or satisfied (26%) about Biden’s victory, while just over 4 in 10 are dissatisfied (29%) or angry (15%).

While 60% of Americans believe Biden won the election fair and square, 32% say he only won it due to voter fraud.  Three-quarters (77%) of Trump backers say Biden’s win was due to fraud.  Director of the independent Monmouth University Polling Institute, Patrick Murray, added, “The anger among Trump’s base is tied to a belief that the election was stolen.”

A majority (54%) of Americans believe we have enough information on the vote count to know who won the presidential election, but a sizable minority (44%) feel we, in fact, do not.

Most Americans (61%) disapprove of how Trump is handling the presidential transition process. Just 31% approve.  One-in-four Republicans (25%) disapprove of Trump’s behavior.

John Bolton / New York Daily News

“As Russia, China and other adversaries try to undermine our citizenry’s confidence in American institutions, Donald Trump has been their hopefully unwitting ally.  Oblivious to anything not directly benefitting him. Trump spent much of the 2020 campaign, and has spent nearly every waking hour since Nov. 3 complaining that the outcome was rigged, and that massive conspiracies to commit fraud are overturning his re-election.

“Trump’s unprecedented insistence that the core machinery of U.S. elections (voter identification and vote casting, counting and certification) is being manipulated is obviously wrong. Significant protections and safeguards are built into the electoral process in every state and county because we know that the possibilities for fraud and stolen elections are ever-present, notwithstanding the dewy-eyed view of some commentators.  If Trump had evidence of election-rigging or fraud, he should have produced it by now.  He has not; lawsuits have flamed out or been radically pared back.

“But his continued aspersions on the 2020 election buttress the case our enemies make against us.  Now, they can quote an American president for their own ends.

“Without a doubt, Russian and Chinese efforts in the 2016 and 2020 elections have been devoted to undermining America’s confidence in its own institutions, increasing mistrust among our fellow citizens, and confusing the public discourse with false and misleading information.  They have most certainly used cyberwarfare against the integrity of our elections, and China’s subversive efforts especially have ranged far more broadly, as Vice President Mike Pence has previously made clear.

“We, and Trump in particular, do Moscow’s and Beijing’s work for them when we argue whether they favor Trump or favor Biden. Russia and China favor themselves; merely inducing Americans to argue about their strategies is likely a vital part of the strategies themselves. Trump has been told all this, but his fascination with himself bleaches out all other concerns in his public remarks.

“Attacking America’s institutions is not a Republican Party or conservative hallmark.  For Trump, it is something of a commonplace. For example, in a 2017 pre-Super Bowl interview with Fox News’ Bill O’Reilly, Trump said he respected Russia’s Vladimir Putin.  O’Reilly responded that Putin was ‘a killer.’  Trump paused for a few seconds – perhaps actually reflecting on what it was he wanted to say – before responding, ‘We’ve got a lot of killers. You think our country is so innocent?’

“This Trumpian moral equivalency emerges all too often.  Prior to his embarrassing exchange with O’Reilly, Trump said of Putin in 2015, ‘he’s running his country, and at least he’s a leader, unlike what we have in this country.’  The list of comparable examples is depressingly long.

“After Nov. 3, Trump’s antics reached fever-pitch.  In nearly incoherent remarks during the early hours of Wednesday, Nov. 4, as the vote totals were turning against him, Trump said, ‘This is a fraud on the American public. This is an embarrassment to our country.  We were getting ready to win this election.  Frankly, we did win this election.’  On Nov. 5, Trump said further, ‘If you count the legal votes, I easily win.  If you count the illegal votes, they can try to steal the election from us.’  Even when he seemingly lets the truth slip out, as on Nov. 15, when he admitted a Biden win, he quickly reverses course.

“All of this is propaganda, which does constitute ‘an embarrassment to our country,’ coming as it does from the president. Trump’s record over four years, and continuing right until today, is in the sociological expression Sen. Daniel Patrick Moynihan popularized, ‘defining deviancy down’ in the political world.  Our expectations for Trump are so low, we have lost the capacity to be surprised.

“Fortunately, however, Trump’s abnormality provides precisely the way to repair the damage his presidency, and especially his post-election performance, have caused us internationally.  We must stress that Trump is an aberration, an anomaly, rather than an accurate reflection of the American system or its people. Trump’s war with the election results, sadly but ironically helpfully, is the best proof of his aberrant status.

“To repair the damage that his tweets and his actions have caused in recent days, as with repairing the larger damage he has done to our reputation overseas, we need to emphasize that the 2020 election has, hopefully, brought a return to ‘normalcy.’ Biden may not like being this century’s Warren Harding, but that may just be his lot, at least in the rest of the world’s estimate.

“We will have significant debates between normal Republicans and Democrats about Biden’s foreign and domestic policies, which we and the world will welcome as normal, and this too will help repair Trump’s damage.  The process could actually move quickly.  Let’s hope so.”

President Trump tweeted on being told of Bolton’s op-ed:

“John Bolton was one of the dumbest people in government that I’ve had the ‘pleasure’ to work with. A sullen, dull and quiet guy, he added nothing to National Security except, ‘Gee, let’s go to war.’  Also, illegally released much Classified Information.  A real dope!”

Jeffrey Goldberg of The Atlantic had an extensive interview with former President Barack Obama, as the latter hawks part one of his memoirs.

On Republican complicity with Trump:

OBAMA: I did not believe how easily the Republican establishment, people who had been in Washington for a long time and had professed a belief in certain institutional values and norms, would just cave… To see figures in the Republican Party do a complete 180 on everything they claimed to believe previously is troubling.

On the crisis of disinformation:

OBAMA: If we do not have the capacity to distinguish what’s true from what’s false, then by definition the marketplace of ideas doesn’t work.  And by definition our democracy doesn’t work. We are entering into an epistemological crisis.

On Trump as Richie Rich, not John Wayne:

OBAMA: I think about the classic male hero in American culture when you and I were growing up: the John Waynes, the Gary Coopers, the Jimmy Stewarts, the Clint Eastwoods… Even if you are someone who is annoyed by wokeness and political correctness and wants men to be men again and is tired about everyone complaining about the patriarchy, I thought that the model wouldn’t be Richie Rich – the complaining, lying, doesn’t-take-responsibility-for-anything type of figure.

On the American idea:

OBAMA: America as an experiment is genuinely important to the world not because of the accident of history that made us the most powerful nation on Earth, but because America is the first real experiment in building a large multiethnic, multicultural democracy. And we don’t know yet if that can hold.

Peggy Noonan / Wall Street Journal

“No hard evidence of widespread fraud, no success in the courts or prospect of it.  You can have a theory that a bad thing was done, but only facts will establish it.  You need to do more than what Rudy Giuliani did at his news conference Thursday, which was throw out huge, barely comprehensible allegations and call people ‘crooks.’  You need to do more than Sidney Powell, who, at the same news conference, charged that ‘communist money’ is behind an international conspiracy to rig the U.S. election. There was drama, hyperbole, perhaps madness.  But the wilder the charges, the more insubstantial the case appeared.

“More than two weeks after the election, it’s clear where this is going.  The winner will be certified and acknowledged; Joe Biden will be inaugurated. But it’s right to worry about the damage being done on the journey.

“It’s one thing when supporters of the president say, simply, ‘Let’s go through the process and see where we are.’  It’s not bad to look into how messy the voting system is, not the worst to realize it needs long-term remedial attention. How did we devolve into a nation that no longer has an election night but an election month?

“But the sheer nuttiness surrounding the current mess is becoming deeply destructive. Online you see the websites read by millions saying the entire election system is shot through with criminality. The headlines read; It was stolen. We have proof of coordinated vote tampering. The president has many avenues to victory.  The Trump campaign sent an email under the name of formerly respectable Republican Newt Gingrich, once speaker of the House, saying ‘The Corruption is Unprecedented’:  ‘It’s time for us to get MAD.’  We can’t ‘roll over.’  ‘Please contribute $45 RIGHT NOW to the Official Election Defense Fund.’

“This isn’t a game.  America isn’t your plaything. Doesn’t Mr. Gingrich realize how dangerous it is to stoke people like this, to rev them up on the idea that holding even the slightest faith in the system is for suckers?

“Trump staff and supporters should know at this point that in trying to change the outcome they are doing harm – undercutting respect in and hope for democracy.  Republican senators and representatives, in their silence, are allowing the idea to take hold that the whole system is rigged.  This lessens faith in institutions and in their party’s reputation. Republicans were once protective of who we are and what we created in this democratic republic long ago.

“Now they’re not even protecting themselves; in future years what’s happening now will give their voters an excuse not to take part or show up.  What’s the point? It’s all rigged.

“And they are accepting a new postelection precedent, that national results won’t be accepted until all states are certified and all legal options, even the most bizarre and absurd, exhausted. Wait until this is used against you, in 2024 or ’28.  You won’t like it….

“Responsible Republican leaders ought to congeal and address the fact that what rough faith and trust we have in the system is being damaged. Which means our ability to proceed as a healthy democracy is being damaged.

“There is no realistic route to victory for the president, only to confusion and chaos and undermining.  He is not going to find the votes in recounts to win the election. Dominion, the voting-machine company under attack, has not been credibly charged with doing anything wrong.  As the Journal said this week in an editorial, ‘Strong claims need strong proof, not rumors and innuendo on Twitter.’

‘The irony is that this election will be remembered for the president’s attempts to sow chaos, not for what it actually appears to have been, which is a triumph for America.  In the middle of a pandemic, with new rules, there was historically high turnout.  Under stress the system worked.  Voters were committed, trusting, and stood in line for hours. There was no violence at the polls, no serious charges of voter suppression. In a time of legitimate hacking fears, there were no reports of foreign interference.  Our defenses held.  On top of all that, the outcome was moderate: for all the strife and stress of recent years, the split decision amounted to a reassertion of centrism….

“Imagine if (Trump) acted even remotely normal in his first term, if he’d had the intellectual, emotional and spiritual resources to moderate himself, to act respectably.  Heck, imagine if he’d worn a mask.  He might have won.

“He is set on going out like a villain. He and his people would find this Jacksonian – he’s refusing to bow to entrenched establishments!  He would think this is what his base wants – the old battler refusing to accept the illicit judgments of a decadent elite.

“If he were clever and disciplined, he’d do it differently.  He’d accept the election’s outcome, if not graciously at least with finality, go home to Mar-a-Lago, play golf, and have fun torturing his party by plotting his return. ‘I’ll be back.’

“Instead he leaves behind real and politically pointless ruin.”

---

Covid-19 death tolls, as of tonight….

World…1,377,527
USA…260,283
Brazil…168,662
India…132,764
Mexico…100,823
UK…54,296
Italy…48,569
France…48,265
Iran…43,896
Spain…42,619
Argentina…36,790
Peru…35,484
Russia…35,311
Colombia…34,929
South Africa…20,759

Source: worldometers.info

U.S. daily death tolls…Sun. 579; Mon. 739; Tues. 1,615; Wed. 1,965; Thurs. 2,065; Fri. 1,951.

Various states, including those run by Republican governors, have instituted lockdowns and/or mask mandates, as state after state reports record numbers in cases and deaths. 

According to the Department of Health and Human Services, 1 in 5 U.S. hospitals anticipate a critical staff shortage within seven days.

North Dakota, Missouri and Wisconsin reported the highest share, each with almost half of its hospitals in need of medical staff as of Wednesday.

A dearth of nurses, doctors and other key healthcare workers could not only endanger patients, but also risk burning out existing staff, many of whom have been struggling since March.

In Europe, such as in the UK, France, Germany and Spain, cases appear to be leveling off some, though at still catastrophic heights.  Poland’s case/death chart is sickening.

Covid Bytes

--Pfizer and partner BioNTech sought emergency use authorization from the Food and Drug Administration today, with Moderna to follow soon, for their coronavirus vaccines.  The FDA needs to examine the data and a decision could be forthcoming in roughly two weeks.

Moderna says its vaccine candidate remains stable at standard refrigerator temperatures of 36 to 46 degrees Fahrenheit for 30 days, and it remains stable for up to six months in a freezer set at minue-4 degrees Fahrenheit; much simpler than Pfizer’s candidate that needs to remain in super-cold storage – roughly minus-103 Fahrenheit.

Both Pfizer and Moderna’s vaccines require two shots over 3 or 4 weeks.

--Dr. Anthony Fauci projected Americans could expect their first doses of an approved coronavirus vaccine as early as April.

Front-line health care workers are expected to get their first doses by the end of December or early January.  After prioritizing people at risk of infection or severe disease, the healthy general population can expect first doses of a vaccine starting in April and through July if all continues on track.

If most of the population is vaccinated by summer and fall, Fauci said, people can start looking forward to returning to pre-pandemic normalcy.

But to get there, vaccine hesitancy must be overcome, especially in minority communities, the same that are being hit the hardest by Covid.

Hispanic or Latino people have been hospitalized at the highest rate, 4.2 times the rate of whites. African-Americans are at 3.9 times the rate of whites, according to figures from the CDC.

--An Oxford University study of healthcare workers on the frontline found that those who’ve had Covid-19 are highly unlikely to contract it again for at least six months after the first infection.

--The World Health Organization has released updated guidance on Covid-19 treatments recommending against the use of Gilead’s remdesivir for treating patients, regardless of the severity of their illness.

According to the WHO, the updated guideline was based on new data from four trials involving 7,000 patients. Data suggested that remdesivir had “no important effect on mortality, need for mechanical ventilation, time to clinical improvement and other patient-important outcomes.”

Gilead and the U.S. FDA disagree vehemently with the WHO’s stance.

--CNN’s Matthew Chance had a horrifying report on Russia’s Covid crisis. While the government shows off a new pop-up facility in a major ice rink with the latest equipment, outside Moscow the situation is dire, bodies piled up in the hallways of regional hospitals.

On Thursday Russia’s health minister urged regional leaders to take further steps to slow the spread as the number of daily deaths and infections hit new highs.

While authorities have resisted imposing lockdown restrictions across the country as they did earlier this year, they have imposed strict rules for wearing masks and gloves and underlined the importance of hygiene and social distancing.

--Iran is preparing for a wide-ranging lockdown to slow the spread, with more than 300 cities and towns slated for new restrictions that will inflict further pain on its sanctions-battered economy.

Iran’s official case load is now four times higher than during the first peak earlier this year, as the government reports more than 400 deaths daily, many believing the real total is far higher.

Under the lockdown Iran will close nonessential businesses in cities and towns with the highest risk of contagion.

--Turkey’s President Erdogan said on Tuesday that the government will impose tighter measures to fight the coronavirus and impose partial lockdowns on weekends across the country.  Erdogan also said all schools will remain closed until the year-end and all restaurants will only work by delivery.

--A fire last Saturday at a Romanian hospital treating coronavirus patients killed ten.  The fire broke out in one room of the intensive care unit and spread to an adjoining room.

--The issue of mink farms continues, with Ireland looking to cull 120,000 farmed animals on the State’s three remaining facilities in counties Laois, Kerry and Donegal.  The Department of Agriculture noted the Department of Health’s recommendation that continued mink farming raises the risk of mutated Covid-19 strains that could be passed to humans and affect the success of efforts to vaccinate the population during the course of next year.

But in Denmark, the agriculture minister has resigned, becoming the first in the government to fall in a growing scandal over an illegal order to kill all mink in the country, up to 17 million.

Center-left prime minister Mette Frederiksen is under fire as the justice ministry issued a report saying authorities broke the law and that the process was “reprehensive and regrettable.”

Denmark, the world’s largest producer of mink, sells most of the fur to China and Russia, but a new law proposed this week will ban farming of the creatures until 2022.

The cull descended into farce when the government was forced to concede it was only legal to kill infected mink and those within 8km of infected animals, which is kind of the policy adopted in the U.S., which is attempting to isolate individual farms, rather than issue a mass cull order.

Scientists are also now questioning how dangerous the mutation is.

--Canada’s top medical official said in a grim forecast on Friday that new daily cases of coronavirus in Canada could soar to 60,000 by the end of the year, up from less than 5,000 now, if people increase their daily contacts.

--Meanwhile, Australia’s once hard-hit state of Victoria has gone three weeks without a new Covid-19 case for the first time since February.

--Michael Gerson / Washington Post

“President Trump will be remembered for many things.  For the audacity of his mendacity.  For his ready recourse to prejudice. For his savant’s ability to rile and ride social resentment.  For his welcoming of right-wing crackpots into the Republican coalition.  For his elevation of self-love into a populist cause.  For his brutal but bumbling use of force against protesters. For his routinization of self-dealing and political corruption.  For his utter lack of public spirit and graciousness, even to the very end.  And, to be fair, for the remarkable achievement of winning more than 73 million votes without an appealing message, without significant achievements and without a discernible agenda for the future.

“But though Trump will be remembered for all these things, he will be judged for one thing above all: When the pandemic came and hundreds of thousands of Americans died, he didn’t give a damn.

“How do we know that? It is not easy to read a man’s heart.  But it is easier to detect that organ’s absence.  Trump is not only refusing to provide leadership during a rapidly mounting health crisis; he is also sabotaging the ability of the incoming Biden administration to cooperate with leaders at the Centers for Disease Control and Prevention, the National Institutes of Health and other government agencies.  By disrupting the presidential transition during an unfolding Covid-19 disaster, Trump is engaging in American history’s most deadly sulk.

“Even before his reelection loss, Trump had trouble expressing empathy for victims of the pandemic and their families.  Even after his own bout with Covid-19, he did not seem capable of feeling or imagining the suffering of others. This may reflect some psychological incapacity.  But it also indicates a certain view of pandemic politics.  From the start, Trump did not believe the disease itself was a true enemy.  Rather, he viewed the public perception of widespread disease as the real threat – the threat to his political future.  So the fewer Americans who believed in the disease’s spread, the better.  And the less attention that victims of the disease received, the better.

“This helps explain Trump’s own explanation, given to The Post’s Bob Woodward at the start of the pandemic. ‘I wanted to always play it down,’ the president said.  ‘I still like playing it down, because I don’t want to create a panic.’  A panic, after all, might spook the stock market, or make him appear responsible….

“In this cramped and selfish view of the world, every Covid-19 victim who is highlighted by the media is perceived by the president as an attack on himself.  And the public expression of sympathy on his own part would be self-sabotage, an admission of failure.  So when Trump recovered from the disease, he did not say, as former New Jersey governor Chris Christie did in a similar situation, ‘I should have worn a mask.’  Instead, Trump pronounced himself ‘immune,’ held dangerous, largely mask-less political rallies and used his own rapid recovery to play down the seriousness of the disease.

“Recovery from Covid did not change Trump’s perspective, and neither has electoral loss. The president is apparently too busy moping, golfing, fuming and lying to assume leadership during a spiraling health challenge. He has roused only enough interest to take personal credit for a prospective vaccine.  Once again, Trump does not seem to regard Covid-19 as a threat to the country requiring responsible action.  He sees the pandemic as an attack on his person, to be downplayed or denied.  This is egotism, turned cruel and deadly.

“The country will not be delivered by appealing to Trump’s better angels, who fled in disgust long ago.  It might help if elected Republicans stopped ignoring and enabling Trump’s lethal tantrum.  But the hours until noon, Jan. 20, still move too slowly.”

Trump World

--A “risk-limiting audit” found Joe Biden won Georgia by 12,284 votes, a narrower margin than the 14,196-vote lead he held immediately following the election. Local election administrators identified uncounted ballots in four counties. Each was the result of human error.

“Georgia’s historic first statewide audit reaffirmed that the state’s new secure paper ballot voting system accurately counted and reported results,” Georgia’s Secretary of State Brad Raffensperger, who ordered the recount, said in a statement. 

Biden is the first Democratic presidential candidate to win Georgia since Bill Clinton in 1992.

But because the margin of victory was under 0.5%, President Trump can still call for a recount.  Trump is reportedly furious with Georgia Republican Governor Brian Kemp for not doing more to overturn the outcome.

--Patrick Tucker / Defense One

“Five days ago, officials from both parties and across state and local governments issued a historic statement: ‘The November 3rd election was the most secure in American history.’

“Amid the worst global health crisis in living memory, a record number of Americans successfully and safely cast their vote in the U.S. presidential election. That they were able to do so, and that officials across the country could testify to the integrity of the vote, is due in no small part to the efforts of Christopher Krebs, who was fired tonight as director of the Cybersecurity Infrastructure Security Agency, or CISA.

“Krebs ran afoul of Donald Trump by refusing to let the president’s lies and baseless assertions about the election go unchallenged.  In one of his final tweets as CISA director, Krebs wrote, ‘ICYMI: On allegations that election systems were manipulated, 59 election security experts all agree, ‘in every case of which we are aware, these claims either have been unsubstantiated or are technically incoherent.’”

“For his efforts to secure America’s vote, Krebs was sacked by presidential tweet on Tuesday, nearly two years after Trump signed the legislation that created the agency under the Homeland Security Department.  His deputy, Matt Travis, also resigned, reportedly upon learning that he would not take Krebs’ place at the agency’s helm.  The acting director will likely be Brandon Wales, CISA’s senior career executive and executive director….

“On Election Day itself, CISA officials held background calls every few hours, updating reporters on what was happening and not happening. That was typical of Krebs, who was often as accessible to the press as to a state election officer.  Not all of these briefings were particularly interesting, owing only to the fact that it’s hard to make compelling copy out of steady progress.

“Krebs made more headlines by being fired than he did working.  Krebs’ summary dismissal brought swift rebuke from Sen. Mark Warner, D-Va., the vice chair of the Senate Intelligence Committee.

“ ‘Chris Krebs is an extraordinary public servant and exactly the person Americans want protecting the security of our elections,’ said Sen. Warner in a statement.  ‘It speaks volumes that the president chose to fire him simply for telling the truth.’

“Sen. Jack Reed, D-Rhode Island, ranking member of the Armed Services Committee, said, ‘This is an appalling move by President Trump. He is firing Mr. Krebs out of petty vindictiveness.  He clearly wants to remove officials who are in a position to rebut his misinformation… President Trump is still in denial.  But there is no getting around the fact that he lost the election fair and square and the results clearly show President-elect Biden won both the popular vote and in the Electoral College by a wide, significant, irrefutable margin.’

“That is the ultimate legacy of Christopher Krebs.  There is no serious dispute about the integrity of the 2020 elections.  There is only an incumbent who has lost. But America’s infrastructure remains secure. For now.”

--Historian Simon Schama’s tweet on Donald Trump:

“He’ll be remembered like some deranged Roman emperor from the pages of Suetonius or Gibbon, entirely indifferent to mass sickness and death, consumed only by the delusion of deified self-importance.”

--Dr. Scott Atlas tweeted, regarding Michigan and Gov. Gretchen Whitmer and renewed restrictions to fight the coronavirus surge in her state:

“The only way this stops is if people rise up. You get what you accept.  #FreedomMatters #StepUp.”

When told this was a rather obvious threat, Atlas then tweeted:

“Hey.  I NEVER was talking at all about violence.  People vote, people peacefully protest.  NEVER would I endorse or incite violence.  NEVER!!’

--Trump tweets:

[Since Wednesday]

“They didn’t even allow Republican Observers into the building to watch. A terrible insult to our Constitution!”

“The Georgia recount is a joke and is being done UNDER PROTEST. Even though thousands of fraudulent votes have been found, the real number is in matching signatures. Governor must open up the unconstitutional Consent Decree and call in the Legislature!”

“THEY WOULDN’T LET REPUBLICAN POLL WATCHERS INTO THE COUNTING ROOMS.  UNCONSTITUTIONAL!!!”

“In Detroit, there are FAR MORE VOTES THAN PEOPLE.  Nothing can be done to cure that giant scam. I win Michigan!”

“The Great State of Michigan, with votes being far greater than the number of people who voted, cannot certify the election.  The Democrats cheated big time, and got caught.  A Republican WIN!”

“BREAKING: The Wayne County Board of Canvassers has just unanimously voted to certify the results of the election & called on Michigan SOS Jocelyn Benson to conduct an audit of the unexplained precincts in Wayne County that did not match.

“…AND I WON THE ELECTION. VOTER FRAUD ALL OVER THE COUNTRY!”

“This was a rigged election.  No Republican Poll Watchers allowed, voting machine ‘glitches’ all over the place (meaning they got caught cheating!), voting after election ended, and so much more!”

“Lawyers now on @newsmax, @OANN & maybe @FoxNews.  An open and shut case of voter fraud. Massive numbers!”

“THE COVID DRUGS NOW AVAILABLE TO MAKE PEOPLE BETTER ARE AMAZING, BUT SELDOM TALKED ABOUT BY THE MEDIA!  Mortality rate is 85% down!”

“Evidence of voter fraud continues to grow, including 20,000 dead people on the Pennsylvania voters roll and many thousands all over the Country. Now, there has been an artificial number of votes in favor of Joe Biden.”

“Thousands of uncounted votes discovered in Georgia counties. When the much more important signature match takes place, the State will flip Republican, and very quickly. Get it done! @BrianKempGA”

“Voter fraud in Detroit is rampant, and has been for many years!”

“The Governor of Georgia, and Secretary of State, refuse to let us look at signatures which would expose hundreds of thousands of illegal ballots, and give the Republican Party and me, David Perdue, and perhaps Kelly Loeffler, a BIG VICTORY…

“…Why won’t they do it, and why are they so fast to certify a meaningless tally?”

“European Countries are sadly getting clobbered by the China Virus. The Fake News does not like reporting this!”

[Ed. Hey asshole…we are reporting on it.]

Wall Street and the Economy

On the economic data front, housing continued to be the star, with October housing starts coming in far higher than expected, a 1.53 million annualized pace, with existing home sales for the month at 6.85 million, up 26.6% year-on-year and the highest level since Feb. 2006, the latter as reported by the National Association of Realtors.

Home prices have climbed in recent months and the median existing-home price rose 15.5% from a year earlier to $313,000, a record high nominally and adjusted for inflation, NAR said.

“Home sales are just booming in the current environment,” said Lawrence Yun, NAR’s chief economist.  “The upper-end market is really flying.”

But economists say affordability is becoming a growing concern, even when weighing the impact of record-low interest rates, but the shortage of homes for sale, with record-low inventories, is leading to bidding wars, making it harder for first-time home buyers to enter the market.

Meanwhile, retail sales in October disappointed, up 0.3% from September’s revised downward 1.6% rise.  Ex-autos the figure was 0.2%, also less than expected.

October industrial production was solid, 1.1%.

But, in keeping with the surge in coronavirus cases across the U.S., weekly jobless claims rose to 742,000 from 711,000 the prior week, as reported by the Labor Department.  This is highly worrisome with new restrictions on activity being put in place all over the nation.

That said, the Atlanta Fed’s GDPNow barometer for the fourth quarter is at a strong 5.6%, though, again, this is before the Covid surge impacts data negatively.

S&P Global Economics said in a report today that real GDP will likely contract 4% in 2020 and grow a “modest” 3.9% in 2021 if a $500 billion stimulus package is passed before the end of the year.

Even with that boost, by the fourth quarter of 2023, real GDP would still be $115 billion, or 2.2%, smaller than what S&P Global expected in its December 2019 forecast.

The company said it estimates the risk of recession in the next 12 months at 25% to 30% due to both post-election tensions and “stimulus fatigue.”

So speaking of stimulus and federal programs already in place, Treasury Secretary Steven Mnuchin said he does not plan to extend several key emergency lending programs beyond the end of the year and asked the Federal Reserve to return the money supporting them, which could hinder President-elect Biden’s ability to use the central bank’s vast powers to cushion the economic fallout from the coronavirus.

The programs Treasury would not continue include one supporting the markets for corporate and municipal debt and one that extends loans to midsize businesses.  Investors had expected some or all of the programs to be kept operational as long as the pandemic continued to pose economic risks.

In a statement the central bank said: “The Federal Reserve would prefer that the full suite of emergency facilities established during the coronavirus pandemic continue to serve their important role as a backstop for our still-strained and vulnerable economy.”

Today, Mnuchin said Congress should use the money involved, some $454 billion, to help small companies with grants rather than loans.

Dallas Federal Reserve Bank President Robert Kaplan called for more fiscal support for the U.S. economy, particularly for state and local governments struggling with budget holes, and for the millions of unemployed who are spending down savings from prior aid.

“If the savings from those do run out you are going to see consumer spending get weaker,” Kaplan said at a conference today. “This hasn’t felt as much like a recession for a lot of businesses – it will start to, if you don’t have some renewal in some form of the fiscal relief.”

Lastly, on the trade front, the U.S. Chamber of Commerce said it was concerned the United States was being left behind after 15 Asia-Pacific economies on Sunday formed the world’s largest free-trade bloc, cementing China’s dominant role in regional trade.

The Chamber welcomed the trade-liberalizing benefits of the new Regional Comprehensive Partnership Agreement (RCEP), saying U.S. exporters, workers and farmers needed greater access to Asian markets.  But it said Washington should not join the bloc.

RCEP covers 30%  of the global economy and 30% of the global population, joining for the first time Asian powers China, Japan and South Korea.  It aims in coming years to progressively lower tariffs across many areas.

The United States is absent from both RCEP and the successor to the Trans-Pacific Partnership (TPP), leaving the world’s biggest economy out of two trade groups that span the world’s fastest-growing region.

Myron Brilliant, executive vice president of the Chamber, said the Trump administration had moved to confront unfair trade practices by China but secured only limited new opportunities for U.S. exporters in other parts of Asia.  Trump in early 2017 as one of his first official acts quit the TPP agreement, which Barack Obama had negotiated as part of a U.S. pivot to Asia.

Trump has not concluded any comprehensive new trade deals in Asia since then, Brilliant said. “(But) given the shortcomings of RCEP, we would not recommend the United States joining,” he said, without elaborating.

While U.S. exports to the Asia-Pacific market had increased steadily in recent decades, the market share of U.S. firms had declined.

Myron Brilliant and the Chamber know, however, that the U.S. should not have left the TPP, which was designed to gang up on China – Canada, Mexico, Chile, Peru, Australia, Brunei, Japan, Malaysia, New Zealand, Singapore and Vietnam.  All but the first four (highlighted) then joined Indonesia, Philippines, South Korea, Thailand, Cambodia, China, Laos and Myanmar in the RCEP.

The RCEP offers minimal benefits, which is no doubt what Myron Brilliant is referring to, but the TPP was the biggie and a Biden administration may attempt to rejoin it.

Europe and Asia

Nothing this week of note on the eurozone economy, though next week we get important flash PMI data for the region.  There are real concerns over a double-dip recession due to the new lockdowns as a result of the surge in coronavirus across the continent.

German Chancellor Angela Merkel, though, expressed optimism that the economy in her country, for one, Europe’s biggest, will come back strong.

“We must bring the numbers down and keep them at a low level,” Merkel said on Tuesday.  “And if that succeeds – we saw this in the third quarter of this year – then the economic recovery will significantly accelerate.”

But Merkel has faced resistance on some of her tougher restrictions from the country’s 16 state premiers.

Brexit: At week’s end, the EU and Britain are close to agreement on most issues as time runs out for a trade deal, but they are still at odds over the same items I’ve discussed for a year…fishing rights, guarantees of fair competition and ways to resolve future disputes, a senior EU diplomat told ambassadors in Brussels today.

“We are both close and far away.  It seems that we are very close to agreement on most issues but differences on the three contentious issues persist,” the official told Reuters.

The chief Brexit negotiators were forced to suspend direct talks on Thursday after a member of the EU team tested positive for Covid-19, but officials continued working remotely.

There is just six weeks to go.

A second EU diplomat said of the three main sticking points between negotiators: “They still need their time. Some things on the level playing field have moved, albeit very very slowly. Fisheries are not really moving anywhere right now.”

On a totally different topic, Boris Johnson announced plans to restore Britain’s navy to its position as Europe’s most powerful maritime force, highlighting that shipbuilding could also help heal divisions between the four nations of the United Kingdom.

With repeated polls suggesting most people in Scotland now support independence, Johnson was keen to press the case for how England and Scotland can work together.  He announced plans for 13 more frigates as well as committing to a new generation of warships, which he said would spur a renaissance in shipbuilding across the United Kingdom.  This will illuminate “the benefits of the union in the white light of the arc welder’s torch,” Johnson told parliament.  “If there was one policy which strengthens the UK in every possible sense, it is building more ships for the Royal Navy.”

Days earlier, Johnson had infuriated many Scots by calling the devolution of powers to Scotland “a disaster,” a comment that played into the hands of Scottish nationalists.

The Scottish National Party has made repeated calls for a new referendum on independence, with Johnson particularly disliked by the Scots because he is viewed as arrogant and patronizing.

So the prime minister is scrambling to make amends, such as in guaranteeing the future of Scotland’s Black Watch regiment, which has earned a fearsome reputation fighting in the British Empire’s campaigns, two World Wars, and more recently in Afghanistan and Iraq.

Turning to Asia…nothing of significance from China, while Japan released its GDP data for the third quarter, an annualized jump of 21.4%, rebounding sharply from a record postwar slump in a sign the country is gradually emerging from the damage caused by the pandemic.

But most economists expect the rebound to be moderate amid persistent weakness in consumption and a resurgence in infections at home and abroad.

The rise in GDP marked the first increase in four quarters and followed a 28.8% plunge in April-June.  On a quarter-on-quarter basis, the economy grew 5.0%, faster than forecasts of 4.4%. 

Meanwhile, Japan’s core consumer prices fell in October at their fastest annual pace in nearly a decade as the boost from last year’s sales tax hike petered out, heightening fears of a return to deflation.

Core consumer prices, which exclude fresh food costs, fell 0.7% in October from a year earlier, the third straight month of declines and the biggest year-on-year drop since March 2011.

Finally, we had flash November PMI data in Japan, 48.3 on manufacturing (50 the dividing line between growth and contraction) vs. 48.7 in October, with services down to 46.7 vs. 47.7.

Street Bytes

--Stocks finished mixed as concerns over the surging coronavirus and new restrictions limiting economic activity across much of the nation mitigated the positive impact of the ongoing good news on the vaccine front.

Monday, both the Dow Jones (29950) and S&P 500 (3626) hit new closing record highs before falling back the balance of the week, -0.7% and -0.8%, respectively, while Nasdaq eked out a gain of 0.2%.

The market itself is outrageously overvalued, trading at a trailing P/E of 40 on the S&P 500, and a historically high 22 on 2021’s projected earnings.

--U.S. Treasury Yields

6-mo. 0.09%  2-yr. 0.16%  10-yr. 0.82%  30-yr. 1.52%

The long end of the curve rallied on prospects for a slowing economic recovery amid the surge in the pandemic.

--Judy Shelton’s nomination to fill one of two remaining open seats on the Federal Reserve’s Board of Governors failed to advance to a final vote on Tuesday, a significant setback but one that does not end her chances at ultimately winning confirmation.

Senator Mitch McConnell took steps that will allow him to bring up the nomination again, but her failure to clear a closely watched procedural vote signaled a tough road ahead for President Trump’s nominee,

Trump announced he would nominate Shelton 16 months ago, but her confirmation has been held up time and time again by lawmakers’ skepticism over her views – including being a loyal fan of the president and a longtime proponent of some sort of gold standard, which most economists oppose.

--Less than two years after all Boeing 737 MAX planes were grounded following two deadly crashes, the Federal Aviation Administration Wednesday gave the company the green light to fly again.

“We will never forget the lives lost in the two tragic accidents that led to the decision to suspend operations,” David Calhoun, CEO of Boeing, said in a statement.

“These events and the lessons we have learned as a result have reshaped our company and further focused our attention on our core values of safety, quality and integrity.”

FAA Administrator Steve Dickson officially rescinded the grounding order Wednesday morning after determining that both crashes “involved a common cause” and beginning “proceedings to address the unsafe condition.”

A report from the House Committee on Transportation and Infrastructure blamed both the plane manufacturer and the FAA for “a horrific culmination of a series of faulty technical assumptions by Boeing’s engineers, a lack of transparency on the part of Boeing’s management and grossly insufficient oversight by the FAA.”

Boeing said Wednesday that it has spent the past 20 months working “closely with airlines, providing them with detailed recommendations regarding long-term storage and ensuring their input was part of the effort to safely return the airplanes to service.”

Before lifting off again, all 737 MAX planes must install software enhancements, complete wire separation modifications, conduct pilot training and “accomplish thorough de-preservation activities that will ensure the airplanes are ready for service.”

--American Airlines Group said on Wednesday it would make good on its plan to return the 737 MAX to passenger flights by the end of 2020.  American said it will begin with non-commercial flights in early December before resuming passenger flights later in the month.  The airline said it will operate two flights a day, or one round-trip between Miami and New York from Dec. 29 to Jan. 4.

United Airlines announced plans to return the 737 MAX to service in the first quarter of 2021. Southwest Airlines, the world’s largest MAX operator, said in October it does not plan to fly the aircraft until the second quarter of 2021.

So will passengers return?  The airlines certainly aren’t going to be advertising, “Hey, the MAX is back!”

--Low-cost carrier Norwegian Air Shuttle is seeking bankruptcy protection in Ireland, where its fleet is held, saying the decision was “in the interest of its stakeholders.”

“Norwegian will continue to operate its route network and both its bonds and shares will trade as normal on the Oslo Stock Exchange,” the carrier said.

Like other airlines, its fleet is now mostly grounded as the pandemic caused a near-total halt to global travel.

Earlier this month, the Oslo-based company said it was facing a “very uncertain” future after the Norwegian government turned down its request for additional financial support.  The government said that the airline had been struggling financially even before the pandemic and that aid should be targeted first at healthy businesses.

After that, Norwegian announced it had to lay off another 1,600 staff and ground 15 of the 21 planes it had been flying with.

--The U.S. Travel Association projects travel spending is expected to fall by more than $500 billion in 2020 and is not expected to recover to pre-coronavirus levels until 2024.

The trade group projects spending in 2020 will be $617 billion, down from its July forecast of $622 billion, compared with $1.13 trillion in 2019.  The decline reflects the dramatic falloff in business travel.  The group said the industry has lost nearly 40%, or 3.5 million, of all direct travel jobs and warned another 1 million jobs could be lost without additional government relief by year-end.

As for the TSA Checkpoint travel numbers for 2020 vs. 2019…the last seven days were at 37, 34, 32, 38, 41, 39 and 36 percent of 2019 daily figures.

--Related to the above, travelers are calling off holiday trips as Covid-19 case counts surge around the country.  Thursday, United Airlines reported bookings have slowed and cancellations have risen over the last week.  Southwest said last week that new bookings have slowed and has said cancellations have picked up.  Alaska Air Group said renewed state and local restrictions on travel and public gatherings have “negatively impacted demand in the immediate term.”

“We’ve seen a dampening of demand,” American Airlines Group Inc. President Robert Isom said at an industry event Thursday.

--The national airline of the United Arab Emirates is launching its first-ever daily route to Israel – two months after the countries established diplomatic ties.

Etihad served Tel Aviv for the first time on Oct. 19, and now plans to operate the trip on a daily basis starting March 28, 2021, the carrier said in a statement.

The flight into Abu Dhabi will be timed to provide connections to China, India, Thailand and Australia.

--Last week I wrote of China’s home-grown C919 passenger jet – part of the nation’s ambitions to break the current Boeing-Airbus duopoly on the manufacturing of large passenger aircraft.

But as pointed out in the South China Morning Post this week, the C919 relies on imports of a number of crucial parts, from its engines to its flight-control systems, which means it needs access to the likes of suppliers General Electric, Honeywell International and Rockwell Collins for future deliveries of the new model and the administration of president-elect Joe Biden is likely to continue the Trump administration’s effort to contain China technologically.

China is looking to rollout the C919 (for show, not mass production) next year and the state-owned company building the plane, Comac (Commercial Aircraft Corporation of China) says this is still the schedule.

Comac is hoping to get all the necessary certificates by the end of 2021, but some are now talking 2022 or 2023, depending on whether items such as GE’s LEAP-1C engine are prohibited from being sold to Comac.  The Trump administration did grant GE a license to sell the engines to the Chinese company, but a recent executive order issued by President Trump calls the sale into question.

Just how pragmatic a President Biden will be on the U.S.-China relationship is a big issue, as to whether U.S.-built components for the C919 will be blocked or not.

A Biden administration could, for example, allow the sale of components to Comac, but prohibit the C919 from entering and landing in the U.S., something of that sort.

--Walmart turned out another outstanding quarter as the world’s largest retailer powers through a pandemic that has felled other national chains.

Third-quarter profits surged 56% and revenue hit $133.75 billion, a 5.3% increase, both better than the Street projected.  Online sales spiked nearly 80% after nearly doubling in the previous quarter (the height of the national lockdown).

Same-store sales rose 6.4%.

Walmart’s expansion into online grocery is widening the gap with rivals.  In September it launched a membership program to deliver what people want more than ever these days as they reduce their public exposure: convenience.

Big box stores are thriving even as thousands of retail stores and national chains suffer.  Kohl’s, for example, saw its sales drop 13.3% in Q3 and it lost money.

As infections soar across the country, Walmart is spreading out its traditional Black Friday sale over three separate events in November.  Some of the most enticing offers are going online to encourage customers to stay at home.

Meanwhile, Walmart is retreating further from efforts to expand internationally, announcing Monday it would sell off 85% of its Japanese supermarket subsidiary Seiyu in a deal valued at $1.6 billion.  It said earlier this month it was backing out of Argentina.

Last month, Walmart said it would sell its British supermarket chain Asda for $8.8 billion, though it will keep a minority stake.

--Target reported a surge in third-quarter sales and earnings on Wednesday as the retailer saw a jump in demand for its same-day services including online ordering and pick-up as it looks ahead to the key holiday season.

Revenue was up 21% year-on-year to $22.63 billion, beating expectations, while adjusted earnings handily beat the Street as well.

“Our strong results in 2020 reflect the benefits of our multi-year effort to build a durable and flexible model, with a differentiated assortment and a suite of industry-leading fulfillment options,” said CEO Brian Cornell.  “The result is unprecedented market share gains and historically strong sales growth, both in our stores and our digital channels.”

Comparable sales in the three months through Oct. 31 jumped almost 21% as store sales rose 9.9% and digital comp sales were up 155%.

The company joined other retailers in extending holiday shopping deals for a longer period of time, including Black Friday sales, to cut back on in-store crowds.

Cornell said: “In a holiday season that will feel different for our guests, we’re committed to helping them navigate the season safely, as they find new ways to celebrate with family and friends.”

--Back to Kohl’s, its sales in the third-quarter were $3.98 billion, down from $4.63 billion, while it reported an adjusted profit of a penny per share in the quarter ended Oct. 31.

“I continue to be very proud of how our organization is navigating through the Covid-19 pandemic,” CEO Michelle Gass said in a statement.  “Our third-quarter results exceeded our expectations with significant sequential sales and profitability improvement.”

Digital sales were 32% of Kohl’s total sales in the quarter, as they try and catch up with the likes of Walmart and Target in growing the online platform.

--Macy’s reported its quarterly performance Thursday and sales dropped from a year earlier, though not as much as expected.

Revenue in the three months through Oct. 31 decreased to $3.99 billion from $5.17 billion a year earlier, with the retailer swinging to an adjusted loss of $0.19 a share from a profit of $0.07 previously, but this, too, was far better than anticipated.

Comparable sales were down 21%, while the Street expected a drop of more than 23%.  Digital sales were up 27% from the third quarter of 2019, Macy’s said.

--Home-improvement giant Home Depot reported net earnings that beat expectations, $3.43 billion, as sales totaled $33.54 billion for the three months ending Nov. 1, up 23.2%, from $27.22 billion for the prior-year period, also exceeding the Street’s forecasts.

Comparable store sales were up 24.1%, and U.S. comp sales rose 24.6% during the period, far ahead of estimates.

Home Depot also said it will spend about $1 billion more on employees’ compensation annually as the home improvement chain benefits from a sustained surge in demand for tools, paint and building materials due to the pandemic.

With limited options for travel or leisure activities, Americans are spending more time at home and using their discretionary income on minor home remodeling and repair work.

HD announced it would also buy HD Supply Holdings Inc. in a deal valued at about $8 billion.

--HD rival Lowe’s reported adjusted earnings that beat analysts’ expectations, while sales totaled $22.31 billion, up from $17.39 billion for the prior-year period at the home improvement retailer, also better than the Street’s forecasts.

Comparable sales increased by 30.4%, and online sales more than doubled during the quarter ended Oct. 30.

But the Street was disappointed in the company’s outlook for Q4, which was basically in line with current estimates, which in today’s frothy market isn’t good enough, so the shares dropped about 8% on the news.

--Shares in Beyond Meat rallied after the company said it launched a plant-based minced pork product in China, seeking to tap into the growing demand for its products in the lucrative Asian market.  Beyond Pork will initially be available at five popular restaurants in Shanghai.

--Tesla Inc. is being named to the S&P 500 index, entering Dec. 21 following months of speculation after the stock failed to make the cut during the index’s quarterly rebalancing in early September.  The anticipation has helped drive a nearly fivefold rally in the stock this year, and it will instantly become one of the index’s most influential members.  The company that Tesla is to replace in the index will be named later.

Tesla shares rose as much as 20% on the week and now have a market cap of $464 billion.

--JPMorgan Chase CEO Jamie Dimon took thinly veiled jabs at President Trump for refusing to concede the election, even as he lashed out at lawmakers over stalled stimulus talks and warned that the pandemic is far from over.

“There will be a new president sworn in on January 20,” Dimon told the New York Times’ Dealbook conference.  “We need a peaceful transition. We had an election and we have a new president.  You should support that whether you like it or not because it’s based on a system of faith and trust.”

Dimon was cautiously optimistic about recent breakthroughs on a Covid-19 vaccine but hammered home the point that the crisis is far from over and that “we need fiscal stimulus.”

Dimon is irked Congress remains deadlocked on passing a second relief bill despite the virus becoming more widespread than ever.

“Now we have this big debate ‘Is it $2.2 trillion, $1.5 trillion?’  You gotta be kidding me!’ Dimon exclaimed.  “I mean just split the baby and move on! This is childish behavior on the part of our politicians.”

--Former President Barack Obama’s memoir sold more than 887,000 copies on Tuesday, a rather stunning debut that publisher Penguin Random House said marked the largest first-day sales for any book it had ever published.

The sales included all formats and editions in the U.S. and Canada, as well as preorders.

“A Promised Land,” the first volume of Mr. Obama’s account of his career and years in the White House, slightly outpaced wife Michelle’s opening-day sales of her memoir, “Becoming,” which sold more than 725,000 copies its first day of publication in 2018 and has now logged total sales of more than 14 million copies world-wide in all formats.

Penguin Random House’s parent, German media company Bertelsmann SE, paid an estimated $60 million for the global publishing rights to the books by the Obamas.

Demand was so strong for “A Promised Land” that Penguin Random House increased its print run to 3.4 million copies, up from an original run of 3 million.

Political books have been hot this year.  Mary L. Trump’s memoir “Too Much and Never Enough: How My Family Created the World’s Most Dangerous Man,” sold more than 950,000 copies in the U.S. on July 14, the day it went on sale.

Journalist Bob Woodward’s “Rage” sold 600,000 copies in all formats in its first week on sale in the U.S., while John Bolton’s memoir “The Room Where It Happened” sold more than 780,000 copies in that time frame.

--BuzzFeed Inc. has agreed to acquire HuffPost from Verizon Media in a stock deal, uniting two of the bigger players in digital media.  Under the pact, the companies will syndicate content on each other’s platforms and look to jointly explore advertising opportunities. Verizon Media will get a minority stake in BuzzFeed as a result of the tie-up, the companies said.

Jonah Peretti, BuzzFeed’s founder and chief executive, will run the combined company.

Foreign Affairs

Afghanistan: The Pentagon announced Tuesday that it was halving the number of troops it has in Afghanistan within the next two months, reducing from about 5,000 to 2,500, while also cutting the force level in Iraq from 3,000 to 2,500 by Jan. 15.  President Trump had sought to remove all American troops from Afghanistan, while senior U.S. military officials wanted to maintain the current numbers.  In October, the president tweeted that all U.S. troops should be “home by Christmas.”

The announcement was made by acting defense secretary Christopher C. Miller and came eight days after he took over for ousted defense secretary Mark Esper, who had argued the conditions on the ground in Afghanistan did not warrant such troop reductions.

Esper cited a recent surge in Taliban violence, safety concerns for remaining U.S. troops, possible damage to alliances and the possibility that reducing troops would damage prospects for securing a landmark deal between the Taliban and the Afghan government.

Miller took no questions, nor did he mention Esper’s dissent.  Curiously, the chairman of the Joint Chiefs of Staff, Army Gen. Mark A. Milley, did not appear alongside Miller at the lectern.

Editorial / Wall Street Journal

“Pentagon officials on Monday confirmed our report Sunday night that President Trump is expected to order another troop reduction in Afghanistan – with a deadline conveniently timed just before he is likely to leave office on Jan. 20.  We wish there was some justification other than the looming end of his Presidency.

“There’s certainly no military rationale for reducing U.S. forces to 2,500.  The current 4,500 level was recommended earlier this year by Army Gen. Scott Miller, the U.S. commander in Afghanistan, when Mr. Trump demanded a reduction from 8,000.  The 2,500 looks like a number pulled out of a Pentagon helmet as an arbitrary alternative to the disastrous total pullout Mr. Trump was contemplating last week.

“The smaller force by Jan. 15 means something will have to give in the U.S. mission that includes support for Afghan forces, coordinating the use of air power, intelligence gathering, and counterterror operations against al Qaeda and Islamic State. At some point, low troop levels become a risk to U.S. soldiers because they can’t supply adequate force protection.

“Mr. Trump says it’s time to go because we’ve been there 19 years, and that’s enough.  But that’s a political notion put into his head by the loyalists he has placed in charge of the Pentagon in the last few days.  The rushed reduction in forces will reinforce the Taliban’s view that they needn’t compromise in negotiations with the Afghan government because the Americans are desperate to depart.

“A clear-eyed view of the stakes came Monday on the Senate floor from Majority Leader Mitch McConnell.  ‘A rapid withdrawal of U.S. forces from Afghanistan now would hurt our allies and delight the people who wish us harm.  Violence affecting Afghans is still rampant. The Taliban is not abiding by the conditions of the so-called peace deal,’ Mr. McConnell said.  ‘The consequences of a premature American exit would likely be even worse than President Obama’s withdrawal from Iraq in 2011, which fueled the rise of ISIS and a new round of global terrorism.  It would be reminiscent of the humiliating American departure from Saigon in 1975.

“The Republican leader added: ‘We’d be abandoning our partners in Afghanistan, the brave Afghans who are fighting the terrorists and destroying the government’s leverage in their talks with the Taliban to end the fighting. Our retreat would embolden the Taliban, especially the deadly Haqqani wing, and risk plunging Afghan women and girls back into what they experienced in the 1990s.  It would hand a weakened and scattered al Qaeda a big propaganda victory and a renewed safe haven for plotting attacks against America.  And it would be welcome news to Iran, which has long provided arms and support to the Taliban and explicitly seeks our retreat from the Middle East.’

“Joe Biden’s advisers have said they favor keeping a residual force in Afghanistan, but they can’t know how many troops that requires until they consult with Gen. Miller and Chairman of the Joint Chiefs Mark Milley.  Let’s hope the generals can follow Mr. Trump’s misguided orders in a way that offers Mr. Biden more options than retreat after he’s in the White House.”

Katie Bo Williams / Defense One

“In Afghanistan, the Taliban still has not renounced al-Qaida – a key precondition for withdrawal in the U.S.-Taliban agreement inked last February.  The insurgent group has also upped its attacks in recent months, with October seeing the highest civilian death toll in Afghanistan in over a year….

“It was a jarring juxtaposition that appeared to be an effort to balance the political demands of a president eager to take credit for ‘ending’ wars with the deep concerns of Republican lawmakers on Capitol Hill.

“ ‘We owe this moment to the many patriots who made the ultimate sacrifice and their comrades who carry forward their legacy,’ Miller said.  ‘In light of these tremendous sacrifices, and with great humility and gratitude to those who came before us, I am formally announcing that we will implement President Trump’s orders to continue our repositioning of forces from those two countries.’

“Miller caught himself after mistakenly saying that the United States would meet a withdrawal deadline of Jan. 15, ‘2001’ – accidentally conflating 2021 with the year the Afghanistan conflict began….

“Defense officials insisted earlier on Tuesday that the proper conditions had been met to allow the troop drawdowns without damaging U.S. national security or the ongoing mission to support Taliban-Afghan peace talks that are meant to end the war in Afghanistan. But they refused to answer repeated questions about which conditions had been met, and they declined to address a recent, classified memo from former Defense Secretary Mark Esper warning the White House that the situation on the ground in Afghanistan had not progressed enough to allow further troop cuts.

“That memo, reported by the Washington Post, warned of the ongoing attacks by the Taliban, the risk that a rapid pull-out would endanger the remaining U.S. troops, potential damage to the ongoing peace negotiations and possible damage to alliances….

“The move also earned a swift rebuke from NATO General Secretary Jens Stoltenberg, who said Tuesday, ‘NATO went into Afghanistan after an attack on the United States to ensure that it would never again be a safe haven for international terrorists’ and warned that the ‘price for leaving too soon or in an uncoordinated way could be very high.’”

Iran: President Trump asked for options on attacking Iran’s main nuclear site last week but ultimately decided against taking the dramatic step, four current and former U.S. officials said on Monday, according to the New York Times.  Trump made the request during a meeting with his top national security aides, including Vice President Mike Pence, acting defense secretary Christopher Miller, Secretary of State Pompeo and Joint Chiefs of Staff Chairman General Mark Milley.

Any strike would almost certainly be focused on Natanz, where the International Atomic Energy Agency reported last week (as I wrote in my last review) that Iran’s uranium stockpile was now 12 times larger than permitted under the nuclear accord that Trump abandoned in 2018.

It is clear Trump, in looking to take such an action, is seeking to poison relations with Tehran further so that it would be harder for the incoming Biden administration to revive the 2015 Iran nuclear accord, as he has promised to do.

Israel: Secretary of State Mike Pompeo paid the first visit by such a high-level U.S. official to an Israeli settlement in the occupied West Bank, in a parting show of solidarity with Prime Minister Benjamin Netanyahu.

Palestinians accused Pompeo, who then went to the occupied Golan Heights after, of helping Israel cement its hold on West Bank land they seek for a state.

Pompeo announced a year ago that the United States no longer viewed Israel’s settlements on land it captured in the 1967 Middle East war as “inconsistent with international law.”

In the West Bank, Pompeo toured the Psagot settlement’s winery – after it named one of its wines after him.

Netanyahu praised President Trump in his meeting with Pompeo for recognizing Jerusalem as Israel’s capital and Israeli sovereignty over the Golan, which Israel annexed in 1981 in a move few countries have accepted.

“The simple recognition of this (the Golan) as part of Israel, too, was a decision President Trump made that is historically important and simply a recognition of reality,” Pompeo said.

Hana Ashrawi, a veteran Palestinian negotiator, accused Pompeo of using Trump’s final weeks in office “to set yet another illegal precedent, violate international law and perhaps to advance his own future political ambitions.”

Yes, Ms. Ashrawi is right.  Pompeo is set on advancing his own future ambitions.  To that end, he said in a statement on Thursday that the United States will require imports from Israeli settlements in the occupied West Bank be labelled as having been “Made in Israel” or “Product of Israel.”  In the past such settlement products were labeled as “Made in West Bank.”

Separately, Israel struck Iranian and Syrian targets in Syria early Wednesday in response to explosive devices found on the border the previous day.

“IDF warplanes attacked military targets belonging to the Iranian Quds Force and the Syrian army tonight in Syria,” the IDF said in a statement.

Among the targets hit was an Iranian military complex near Damascus International Airport.

China: With 60 days remaining before the inauguration of Joe Biden, a spike in tensions between the U.S. and China on issues such as Taiwan and the South China Sea seems a virtual certainty.

Or the Trump administration could label China’s persecution of minority Uighurs in Xinjiang as “genocide,” imposing more sanctions on Chinese companies or providing more support for Taiwan.

As Wu Xinbo, director of the Centre for American Studies at Fudan University in Shanghai told the South China Morning Post:

“Trump has blamed China for the spread of the pandemic and may think that has cost him the election,” Wu said.

“People like (Sec. of State) Pompeo and (White House trade adviser Peter) Navarro will also seize their last chance to sabotage Sino-U.S. relations.”  [And thus make things worse for Joe Biden.]

Azerbaijan and Armenia:  The ceasefire is holding, but the ethnic animosity in Nagorno-Karabakh is only growing.  Many Christian Armenians are leaving the area after living with the Muslim Azeris in the region for decades.

Said one Armenian to the Associated Press as his village was to come under Azeri control, "In the end, we will blow it up (his home) or set it on fire, in order not to leave anything to Muslims.”

Ethiopia: The situation here with a restive region exploded over the weekend, as northern rebels in Tigray said they promised “hell” on Ethiopian troops in a two-week war threatening the vast nation’s unity and further destabilizing the Horn of Africa.

The war has killed hundreds, sent 30,000 refugees into Sudan, which the UN is labeling another humanitarian crisis, and called into question whether Africa’s youngest leader can hold together Ethiopia’s myriad fractious ethnic groups.

Prime Minister Abiy Ahmed’s government says its forces are marching on Tigray’s capital and will soon triumph over the local ruling Tigray People’s Liberation Front (TPLF), which is accused of revolt.

The TPLF says Abiy has removed Tigrayans from senior security and government posts since he took office in 2018 and now wants to dominate them completely.

Abiy’s government has put former officials – many Tigrayan – on trial for crimes like torture, murder and corruption, but denies any attempt at ethnic domination.

Ethiopia’s army is one of Africa’s strongest, but many officers were Tigrayan and much of its heavy weaponry was based in Tigray, on the front line of the standoff with Eritrea after a 1998-2000 war.

So here’s the irony in this conflict.  Abiy won last year’s Nobel Peace Prize for a pact with Eritrea.

Separately, gunmen in western Ethiopia killed at least 34 people in an attack on a bus Saturday night.  I didn’t see who claimed responsibility.

Peru: Congress on Monday chose legislator Francisco Sagasti as caretaker president, in an attempt to defuse a sharp political crisis after angry protests and the departure of two presidents in the past week.

Sagasti, 76, will assume the presidency ahead of national elections called for April.  He comes after interim leader Manuel Merino resigned on Sunday, five days after being sworn in following the ouster of centrist Martin Vizcarra.

Vizcarra was popular with many Peruvians, but angered lawmakers with his anti-corruption measures, and his removal sparked days of protest that led to the deaths of two men.

Sagasti, a former World Bank official and engineer, has a formidable challenge in bringing stability to the world’s No. 2 copper producer, which was already hard hit by Covid-19 and heading for its worst economic contraction in a century.

Random Musings

--Mark Penn / Wall Street Journal

“The more things change, the more they stay the same – or so it seems in American politics, after the electorate returned the Democratic establishment to power after rejecting it for a rogue outsider four years ago. The surprise finding of the exit polls is that moderates and men provided the crucial swing voters who put Joe Biden into office.

“Has the American electorate changed?  The answer is that despite billions of dollars spent on persuasion, massive increases in turnout, a media with an agenda, and racial unrest, the changes in American voting patterns were miniscule.

“We are one country divided by two parties.  The nation is largely moderate, practical and driven by common sense over ideology.  Most voters prefer compromise on health care, immigration, stimulus and other thorny issues that the extremes of the parties have pushed to the limits.  Only 24% of voters identify as liberal, while 38% say they’re conservative, according to CNN exit polls. Another 38% are moderate. Despite the widespread publicity given the left, since 2014 – a good year for Republicans – the percentage of self-identified liberals declined 2 points, while the share of conservatives increased 3 points.

“By now everyone has heard that President Trump did worse in the suburbs and better with minorities than in 2016. While technically true, the suburban swing occurred before the 2018 midterms, and the minority shift was relatively small, except for Hispanic voters in Florida and the border towns of Texas.  [Ed. this is what my comparison last week proved.]  Some surprising findings have been overlooked.  Mr. Trump’s margin of victory among white women increased from 11 to 13 points, according to CNN’s final adjusted exit polls. But his advantage among white men narrowed from 30 points to 23.

“Mr. Biden won almost all the liberals and Mr. Trump the conservatives.  But Mr. Biden expanded the Democratic lead among moderates to 30 points from 12 in 2016 – the single most significant change.  Moderate men swung the race to Mr. Biden….

“When it comes to polling, the final Hill-Harris Poll got it about right, with a 4-point gap in favor of Mr. Biden.  We saw the momentum in the race seesaw in the last month and end up on Mr. Trump’s side as he ramped up his mass rallies  Prominent national polls, such as from The Wall Street Journal/NBC, CNN and Quinnipiac, predicted 10- to 12-point margins, which would have produced about a 40-state landslide – a result that on its face should have been dismissed as impossible.  Many pollsters will have to rebalance their models to reflect a more conservative and Republican country or continue to report erroneous results – not only in the campaign horse races, but also on key issues….

“Mr, Biden came close to waking up another Hillary Clinton, but his votes fell on this side of victory in key states by small margins. The message from the voters is that we are not divided into two extreme camps. Rather, they are more centrist in nature and outlook, and that a president who governs too far to the right or left is likely to be left behind in the next election.”

--Interesting election tidbit from the Brookings Institution, via Ian Bremmer:

Biden:

477 counties won

Counties account for 70% of U.S. GDP

Trump:

2,497 counties won

29% of GDP

--Rep. Denver Riggleman (R-Va.) / USA TODAY…Riggleman a former U.S. Air Force Intelligence Officer.

“By now, we’re all keenly aware of the threat posed by the novel coronavirus and we all know firsthand how our race to meet that threat head-on has altered the way we learn, do business and interact with each other.

“But another sea change is coming.  The stupendous rise in the popularity and prevalence of conspiracy theories threatens to undermine the basis for civil discourse in America.  Conspiratorial paranoia is spreading like a psychological virus through the American population.  If we can’t stop that virus from festering in the American consciousness, the fate and the future of normal American politics is at stake.  To see why, you have to get into the mindset of a conspiracy theorist.

“Major conspiracy theorists like QAnon have been making headlines in recent weeks and months, and it’s all too obvious why.  What could be more interesting or even alarming in an election year than that 56% of Republicans and about half of Trump supporters believe the claims by QAnon that senior Democrats and political officials are leading a satanic cabal of pedophiles and that Donald Trump is the only one who can stop them?

“Like most other conspiracy theories, QAnon is less like a set of fixed beliefs and more like a symptom of a mental disease.  The claims advanced by conspiracy theorists may be baseless, even outrageous and grotesque at times, but that’s a feature, not a bug.  The temptation is to think that conspiracy theories are well-meaning attempts, however deranged, at explaining reality.  Quite to the contrary, conspiracy theories are far less about making sense of the world and far more about finding an outlet for a seething morass of paranoia, suspicion and distrust. They are weaponized stupidity and monetized myth.

“Conspiracy theories feed, not on facts, but on fantasy. That means most conspiracy theories are incredibly malleable and amorphous at their core.  Take the anti-Semitic conspiracy behind the Protocols of the Elders of Zion as an example. The belief that Jewish people somehow command and control political, social and economic realities has taken a variety of different forms over the decades, even centuries, of its existence.  Hardly anyone today believes in all of the literal claims of the original Protocols document.  But that hasn’t stopped the same pattern of thinking, the same psychology, from recurring again and again in new forms.  In many respects, QAnon itself is a modern-day rehashing of this same old anti-Semitism.

“That flexibility and malleability makes it difficult, if not impossible, to defeat a conspiracy theory for good.  Almost anything that increases feelings of uncertainty, distrust and confusion can act as a viral vector for a new and mutated infection by conspiratorial thinking.  Digital media only exaggerates this feature of conspiracy theories.  Today’s prophets are no longer flesh and blood, but anonymous posters.  This anonymity, coupled with the power of digital media to reach anyone at any time, massively increased the resilience and lifespan of conspiracy theories.

“QAnon is perhaps the paradigmatic example of this. QAnon isn’t surging in popularity because people are unearthing more and more evidence that its central contentions are true. Rather, people feel more and more scared and paranoid, and QAnon provides an outlet.  The digital prophet behind QAnon can capitalize off of uncertainty and ignorance to get more and more people to drink the Kool-Aid.  In our post-truth world rife with uncertainty, misinformation, and doubt, conspiracy theories capture the imagination of the paranoid and the fearful with incredible ease.

“But QAnon is not alone.  Across the political spectrum, conspiracy theories abound. And while they may seem silly or too outlandish to be significant, they are far from harmless.

“Many conspiracy theories explicitly and unashamedly dehumanize whole groups of people.  Yet above and beyond the very real threat of violent extremism and domestic terrorism posed by a dehumanizing conspiracy, widespread paranoia erodes the possibility of civil discourse in our society today.  You can’t have a conversation about facts, policies, or positions if one side of the debate is fundamentally convinced that the other is satanic and evil.  At that point, we don’t have political disagreements anymore; instead, we have moral and spiritual warfare.  When paranoid fantasy takes the place of reality in the minds of millions of Americans, we can’t expect politics as usual to function for very long….

“In the meantime, ordinary Americans have their work cut out for them dealing with friends, family members and coworkers who have been sucked in by conspiracies.  My only advice is that we, as a nation, have to practice an unprecedented degree of courage to speak out against conspiracy theories and challenge misinformation whenever and wherever we find it.  I can’t say whether that will be enough. But I know that if we don’t get courageous now, pretty soon it will be too late.”

--I didn’t have a chance last time to comment on this topic, but, boy, former Auburn football coach and now incoming Alabama Sen. Tommy Tuberville is just a real Albert Einstein, isn’t he?

Tuberville, who won the Republican primary over former Senator Jeff Sessions, thanks to President Trump’s support, and then defeated incumbent Democrat Doug Jones, was interviewed by The Alabama Daily News after he attended orientation in D.C. for new senators.

Asked whether he thought the GOP could utilize their potential majority in the Senate to pass legislation as Democrats will control the House and the White House, Tuberville answered he doesn’t care “if you’re a Republican or Democrat” and that he’s been given a mandate to help people.

“Our government wasn’t set up for one group to have all three branches of government – wasn’t set up that way,” Tuberville continued, saying incorrectly: “You know, the House, the Senate, and the Executive.”

Ah, not quite, Coach.  The three are the legislative, the executive and the judicial.

Tuberville also misidentified what America fought against in World War II. When asked about the biggest takeaways from the election, he stated he was concerned that President-elect Biden had promoted a vison that Tuberville claimed “leads more to a socialist type of government.”

“That’s concerning to me, that we’re to the point now where we’ve got almost half the country voting for something that this country wasn’t built on,” Coach Tommy said.  “I tell people, my dad fought 76 years ago in Europe to free Europe of socialism.”

Ah, not quite, Coach.  Hitler be a fascist, not socialist, and the U.S.S.R., or Union of Soviet Socialist Republics, was our ally.

Tuberville also asserted that he plans to use his new Senate office to fundraise for the two Republican senators from Georgia facing crucial runoff elections.

Ah, not quite, Coach.  Political fundraising out of a federal office building, and using official federal resources for campaign purposes, is verboten, err, forbidden by Senate ethics rules.

--Hurricane Iota reached Cat 5 status before slamming northeastern Nicaragua on Monday evening as a Cat 4, further devastating a region just starting to pick up the pieces from Hurricane Eta two weeks earlier.  At last count, 40+ were dead in Nicaragua, Honduras and Colombia.

Iota is the fiercest November storm in the region since a 1932 Cuba hurricane that packed 175-mph winds.

--Congratulations to SpaceX and NASA for successfully launching four astronauts (three from NASA, one from JAXA, the Japanese space agency) to the International Space Station in a capsule built by SpaceX.

This was the first operational flight of the Crew Dragon spacecraft built and operated by SpaceX, the rocket company started by Elon Musk.  Back in May, a Crew Dragon took two astronauts to the space station, but that was a test flight to shake out remaining glitches in the systems.  The capsule successfully docked with the ISS about 24 hours later, the four crew members to spend six months there.

Phil McAlister, director of commercial spaceflight development at NASA, said, “For the first time in history, there is a commercial capability from a private sector entity to safely and reliably transport people to space.”

--I was watching NBC News local as they were unveiling the Rockefeller Center Christmas Tree, the workers unfolding the branches after it had been hauled to its famous spot from Oneonta, N.Y., and I thought, ‘Good lord, that is a hideous tree.’

Scrawny, scraggly.

And I wasn’t alone.  Why this tree was picked for this special honor I’ll never know.

So I read with amusement this bit from Travis M. Andrews of the Washington Post:

“It seems inevitable, for a year in which so little has gone well, that something would be awry with the Rockefeller Center Christmas tree – an annual source of holiday joy. If 2020 were a movie, we’d complain that the screenwriters are getting lazy. This plot point is a little too on-Rudolph’s-nose.

“And yet, here we are.  On Saturday…as a crane lowered it into place, the Norway spruce looked a little worse for wear.  The bottom limbs appeared to be bare, and its needles hung limply, as if the tree had just climbed out of the shower. Meanwhile, it leaned to the side, as if unsteady on its trunk.

“This tree now sits in the same place as the first one in 1931, a 20-foot balsam fir that workers at the center – which was then under construction – pooled their money to purchase as a display of optimism during the Great Depression. The same place where, in 1932, an iconic photograph captured 11 workers eating lunch on a suspended girder, their legs dangling hundreds of feet over the streets of New York City.

“Much as that photograph became emblematic of one period of American life, for many, this new tree serves as a symbol of today’s.

“ ‘In true 2020 form, the Rockefeller Center Christmas tree looks like it tried to cut its own hair,’ tweeted pianist Chris Ryan….

“ ‘Even the Rockefeller Center Christmas Tree is tired of 2020,’ tweeted political scientist Ian Bremmer….

“It couldn’t help but remind many others of another down-on-his-luck fellow with a sad-looking Christmas tree: Charlie Brown.”

Ah yes, after Charlie Brown walks away glumly, thinking he had killed his little tree, Linus moves in and says:

“I never thought it was such a bad little tree,” as he puts it back up.  “It’s not bad at all, really.  Maybe it just needs a little love.”

Well, this tree needs a little engineering work, actually; like lots of filler branches.

But at least we discovered the little owl, “Rockefeller,” hidden in the mess, none the worse for wear, and for this we are all grateful.

---

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

God bless America.

---

Gold $1870
Oil $42.17

Returns for the week 11/16-11/20

Dow Jones  -0.7%  [29263]
S&P 500  -0.8%  [3557]
S&P MidCap  +1.6%
Russell 2000  +2.4%
Nasdaq  +0.2%  [11854]

Returns for the period 1/1/20-11/20/20

Dow Jones  +2.5%
S&P 500  +10.1%
S&P MidCap  +4.1%
Russell 2000  +7.0%
Nasdaq  +32.1%

Bulls 59.6
Bears
18.2

Hang in there.  Mask up…wash your hands.

And HAPPY THANKSGIVING!!! …really….

Brian Trumbore



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Week in Review

11/21/2020

For the week 11/16-11/20

[Posted 10:00 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 1,127

The crazy elements are going to have to be suppressed with common sense.”

--Rep. Denver Riggleman (R-Va.)

I am both furious and depressed tonight.

Furious at President Trump for his all-out assault on our democracy, and depressed that a solid core of about 40% of Americans actually believe the garbage being spouted by the president and his enablers.

I have been doing this column for 23 years this month, if you include when I started it at PIMCO Funds, November 1997, as PIMCO was putting together their web site.  They knew of my interest in geopolitics, as well as global financial markets, and all these years later the assault on the truth is beyond my comprehension.

I never suffered fools gladly and I never countenanced such behavior.  Not once have I ever parroted a conspiracy theory and I’m incredulous that some otherwise highly-educated Americans seem okay with a leader who is willingly undermining confidence in democracy and free elections.  President Trump contacting Michigan state Republicans to attempt to change the results of an election?  Really?

I was reading a piece from Reuters today about Trump’s supporters in the little town of Sundown, Texas, near Lubbock.  One fellow, Brett F., 50, describes himself as a middle-class Republican.  He owns a small business and has a master’s degree.

At first, in 2016, he voted for Ted Cruz, but today “would go to war for Trump,” as the Reuters story goes.

He has joined the newly formed South Plains Patriots, a group of a few hundred members that includes a “reactionary” force of about three dozen – including Brett and his son – who conduct firearms training.  Nothing will convince Brett and many others in Sundown that Democrat Joe Biden won the Nov. 3 presidential election fairly.  They believe Trump’s stream of election-fraud allegations and say they’re preparing for the possibility of a “civil war” with the American political left.

“If President Trump comes out and says: ‘Guys, I have irrefutable proof of fraud, the courts won’t listen, and I’m now calling on Americans to take up arms,’ we would go,” said Brett.

These are the kinds of attitudes expressed down below in some of the polling data I pass on.

But such troubling talk as that expressed by Brett F. is just an extension of the likes of America’s Clown, Rudy Giuliani, who, during a bizarre press conference Thursday that lasted over 1 1/2 hours, sweated so profusely his hair dye was streaming down both sides of his face.

Giuliani spent his time pushing the completely unfounded claim that Democratic officials used mail-in ballots to rig the election against Trump.

“This is real!  It is not made up!” Giuliani ranted.

But the slimy former mayor, at one time a hero in the aftermath of 9/11, brought matters to a new low as he accused Joe Biden himself of crimes.

“He doesn’t get asked questions about all the evidence of the crimes that he committed,” Giuliani said without explaining what crimes Biden supposedly was involved in.

“What’s going on in this country is horrible,” he added.

Sidney Powell, another member of Trump’s legal team, piled on by falsely claiming the president won the election.

“President Trump won by a landslide,” she said.  “We are going to prove it and we are going to reclaim the United States of America.”

Giuliani repeatedly insisted in the press conference that the campaign’s lawsuits are packed with evidence of Democratic voter fraud.

“All you’ve got to do to find out if I’m misleading you at all is to look at the lawsuit,” he said.

However, Giuliani sang a different tune when pressed under oath by a federal Pennsylvania judge earlier this week on the specifics of a lawsuit filed by the campaign.  “This is not a fraud case,” Giuliani admitted during the hearing.

Chris Krebs, the U.S. government’s top cybersecurity official who was fired by Trump earlier this week after publicly debunking Il Duce’s false fraud claims about the election (more on him below), tweeted:

“That press conference was the most dangerous 1hr 45 minutes of television in American history.  And possibly the craziest.  If you don’t know what I’m talking about, you’re lucky.”

Only a few Republicans have had the guts thus far to step forward and tell the truth.

Sen. Mitt Romney (R-Utah):

“Having failed to make even a plausible case of widespread fraud or conspiracy before any court of law, the President has now resorted to overt pressure on state and local officials to subvert the will of the people and overturn the election.  It is difficult to imagine a worse, more undemocratic action by a sitting American President.”

Sen. Ben Sasse (R-Neb.):

“What matters most at this stage is not the latest press conference or tweet, but what the president’s lawyers are actually saying in court. And based on what I’ve read in their filings, when Trump campaign lawyers have stood before courts under oath, they have repeatedly refused to actually allege grand fraud – because there are legal consequences for lying to judges.”

“We are a nation of laws, not tweets,” Sasse added.

Historian Michael Beschloss:

“We have never seen anything like this before.  This is a president abusing his very great powers to try to stay in office, even though it is obvious to everyone that he has been defeated in the polls.  That is a prospect that terrified most of the founders.”

In an interview with the Washington Post, Beschloss added, “I don’t want to be alarmist, but I do think it’s our job as citizens to keep watch on every one of these things with an eye to that ultimate dread of the founders, which is that a president rejected by the voters would use his powers to try to stay in office anyway.”

Wall Street is starting to get concerned.

Michael Cembalest, chairman of market and investment strategy at JPMorgan Asset Management, warned in a report Wednesday of the “remote risk of an American horror story” and “constitutional mayhem.”

---

Meanwhile, the General Services Administration, the government agency in charge of managing operations of the federal government, has not yet given an “ascertainment” of the election results, at the direction of President Trump, and without the GSA certification, the Biden administration cannot begin a formal transition process, which normally includes the outgoing and incoming administrations coordinating on the operations and infrastructure of the federal government.

It’s bad enough that President Trump is doing his best to delegitimize the Biden presidency before it’s even started, but we’re in the midst of a freakin’ pandemic!  Trump’s lack of cooperation on Covid, as cases and deaths skyrocket, is yet another dereliction of duty.

Remember how as the campaign was winding down, Trump kept saying, “As of Nov. 4, the Fake News Media won’t be saying anything about the coronavirus”?

As of Nov. 4, the pandemic has hit its costliest phase and it’s the president himself who literally has not said a single word on Covid-19 unless it was about vaccines.  Not one word. The healthcare system is breaking down, deaths are mounting, and not one word of empathy from Trump…not one.  What a disgraceful, pathetic man.

Joe Biden said this week that the lack of coordination with the Trump administration related to the coronavirus and issues such as the distribution of the coming vaccines was the biggest threat facing his transition.

It’s criminal. 

On Thursday, the Centers for Disease Control and Prevention said it recommends Americans do not travel during the Thanksgiving holiday next week to mitigate the spread.  The travel recommendation is a “strong recommendation,” not a requirement, CDC official Henry Walke said on a call with reporters Thursday.

“We’re alarmed with the exponential increase in cases, hospitalizations, and deaths,” Walke said.

But one who is not concerned is South Dakota Republican Gov. Kristi Noem, the sexy enchantress, aka Circe, who is hellbent on inheriting Trump’s base in 2024 and running for president.

Those who don’t wear masks are making a “personal decision” that deserves respect, she said during a news conference Wednesday.  She refused to encourage people to wear masks or socially distance, instead saying the best thing people can do to stop the spread of the virus is wash their hands.

It was Noem’s first news conference to address the pandemic in over three months.  Meanwhile, doctors in the state strongly support a mask mandate.

It kills me how you say “mask mandate” and some immediately start wanting to riot…you are taking away our rights!  We won’t accept a lockdown!

We aren’t calling for lockdowns or taking away your rights, you idiots.  Just wear a freakin’ mask indoors when around people.  That’s an egregious sacrifice?!

William McRaven’s Seal Team Six went in blind to take out Osama bin Laden and you can’t wear a mask?

Your grandfather stormed the beaches of Normandy, not knowing if he’d even make it to land, and you can’t wear a mask?

There are 22 units in my building and I’m one of five originals, still here after eleven years.  One of the five is a Russian family on the floor below me.  When I see them in the parking garage or the elevator, the father is friendly enough and I know he likes to go cycling around the area so we small talk about the weather and if he’s gotten out recently, and so this week I see him on the elevator, and of course I have my mask on, and he’s not wearing one, and when I asked if he was riding his bike these days, he said he had gotten a Nordic Track.

“That’s safer,” I said, meaning safer than riding a bike on our busy streets.

Well, the guy misinterpreted me, thinking I was making a Covid comment, and he goes, in his heavy accent, “I don’t agree with mask mandates.”

‘Oh brother,’ I mused.

More Election Fallout…

In keeping with my opening, according to a Reuters/Ipsos poll from Tuesday, about half of all Republicans believe President Trump “rightfully won” the election but that it was stolen from him by widespread voter fraud that favored Joe Biden.

The Nov. 13-17 poll showed that Trump’s open defiance of Biden’s victory in both the popular vote and Electoral College appears to be affecting the public’s confidence in American democracy, especially among Republicans.

Altogether, 73% of those polled agreed that Biden won the election while 5% thought Trump won.  But when asked specifically whether Biden had “rightfully won,” Republicans showed they were suspicious about how Biden’s victory was obtained.

Fifty-two percent of Republicans said that Trump “rightfully won,” while only 29% said that Biden had rightfully won.

Asked why, Republicans were much more concerned than others that state vote counters had tipped the result toward Biden: 68% of Republicans said they were concerned that the election was “rigged,” while only 16% of Democrats and one-third of independents were similarly worried.

Even before winning the 2016 election, Trump kept up a drumbeat of complaints about the process, claiming without evidence that it was unfair to him.

Altogether, 55% of adults in the United States said they believed the Nov. 3 presidential election was “legitimate and accurate,” which is down 7 points from a similar poll that ran shortly after the 2016 election. The 28% who said they thought the election was “the result of illegal voting or election rigging” is up 12 points from four years ago.

The poll showed Republicans were much more likely to be suspicious of Trump’s loss this year than Democrats were when Hillary Clinton lost four years ago.

In 2016, 52% of Democrats said Clinton’s loss was “legitimate and accurate,” even as reports emerged of Russian attempts to influence the outcome. This year, only 26% of Republicans said they thought Trump’s loss was similarly legitimate.

A Monmouth University poll revealed a third of the country is “happy” that Donald Trump lost the election – which is slightly more than the one-quarter who feels the same about Joe Biden winning.  The poll also finds a majority of Americans are confident that the election was conducted fairly, although most Trump voters think Biden’s victory is due to voter fraud.  The president’s refusal to concede may also contribute to the fact that more than 4 in 10 Americans feel we need more information about the vote count before we can be certain of the election’s outcome.

Overall, just half of the American public is either happy (34%) or satisfied (18%) about Trump’s defeat, while nearly 4 in 10 are dissatisfied (28%) or angry (10%).  Likewise, just over half are either happy (25%) or satisfied (26%) about Biden’s victory, while just over 4 in 10 are dissatisfied (29%) or angry (15%).

While 60% of Americans believe Biden won the election fair and square, 32% say he only won it due to voter fraud.  Three-quarters (77%) of Trump backers say Biden’s win was due to fraud.  Director of the independent Monmouth University Polling Institute, Patrick Murray, added, “The anger among Trump’s base is tied to a belief that the election was stolen.”

A majority (54%) of Americans believe we have enough information on the vote count to know who won the presidential election, but a sizable minority (44%) feel we, in fact, do not.

Most Americans (61%) disapprove of how Trump is handling the presidential transition process. Just 31% approve.  One-in-four Republicans (25%) disapprove of Trump’s behavior.

John Bolton / New York Daily News

“As Russia, China and other adversaries try to undermine our citizenry’s confidence in American institutions, Donald Trump has been their hopefully unwitting ally.  Oblivious to anything not directly benefitting him. Trump spent much of the 2020 campaign, and has spent nearly every waking hour since Nov. 3 complaining that the outcome was rigged, and that massive conspiracies to commit fraud are overturning his re-election.

“Trump’s unprecedented insistence that the core machinery of U.S. elections (voter identification and vote casting, counting and certification) is being manipulated is obviously wrong. Significant protections and safeguards are built into the electoral process in every state and county because we know that the possibilities for fraud and stolen elections are ever-present, notwithstanding the dewy-eyed view of some commentators.  If Trump had evidence of election-rigging or fraud, he should have produced it by now.  He has not; lawsuits have flamed out or been radically pared back.

“But his continued aspersions on the 2020 election buttress the case our enemies make against us.  Now, they can quote an American president for their own ends.

“Without a doubt, Russian and Chinese efforts in the 2016 and 2020 elections have been devoted to undermining America’s confidence in its own institutions, increasing mistrust among our fellow citizens, and confusing the public discourse with false and misleading information.  They have most certainly used cyberwarfare against the integrity of our elections, and China’s subversive efforts especially have ranged far more broadly, as Vice President Mike Pence has previously made clear.

“We, and Trump in particular, do Moscow’s and Beijing’s work for them when we argue whether they favor Trump or favor Biden. Russia and China favor themselves; merely inducing Americans to argue about their strategies is likely a vital part of the strategies themselves. Trump has been told all this, but his fascination with himself bleaches out all other concerns in his public remarks.

“Attacking America’s institutions is not a Republican Party or conservative hallmark.  For Trump, it is something of a commonplace. For example, in a 2017 pre-Super Bowl interview with Fox News’ Bill O’Reilly, Trump said he respected Russia’s Vladimir Putin.  O’Reilly responded that Putin was ‘a killer.’  Trump paused for a few seconds – perhaps actually reflecting on what it was he wanted to say – before responding, ‘We’ve got a lot of killers. You think our country is so innocent?’

“This Trumpian moral equivalency emerges all too often.  Prior to his embarrassing exchange with O’Reilly, Trump said of Putin in 2015, ‘he’s running his country, and at least he’s a leader, unlike what we have in this country.’  The list of comparable examples is depressingly long.

“After Nov. 3, Trump’s antics reached fever-pitch.  In nearly incoherent remarks during the early hours of Wednesday, Nov. 4, as the vote totals were turning against him, Trump said, ‘This is a fraud on the American public. This is an embarrassment to our country.  We were getting ready to win this election.  Frankly, we did win this election.’  On Nov. 5, Trump said further, ‘If you count the legal votes, I easily win.  If you count the illegal votes, they can try to steal the election from us.’  Even when he seemingly lets the truth slip out, as on Nov. 15, when he admitted a Biden win, he quickly reverses course.

“All of this is propaganda, which does constitute ‘an embarrassment to our country,’ coming as it does from the president. Trump’s record over four years, and continuing right until today, is in the sociological expression Sen. Daniel Patrick Moynihan popularized, ‘defining deviancy down’ in the political world.  Our expectations for Trump are so low, we have lost the capacity to be surprised.

“Fortunately, however, Trump’s abnormality provides precisely the way to repair the damage his presidency, and especially his post-election performance, have caused us internationally.  We must stress that Trump is an aberration, an anomaly, rather than an accurate reflection of the American system or its people. Trump’s war with the election results, sadly but ironically helpfully, is the best proof of his aberrant status.

“To repair the damage that his tweets and his actions have caused in recent days, as with repairing the larger damage he has done to our reputation overseas, we need to emphasize that the 2020 election has, hopefully, brought a return to ‘normalcy.’ Biden may not like being this century’s Warren Harding, but that may just be his lot, at least in the rest of the world’s estimate.

“We will have significant debates between normal Republicans and Democrats about Biden’s foreign and domestic policies, which we and the world will welcome as normal, and this too will help repair Trump’s damage.  The process could actually move quickly.  Let’s hope so.”

President Trump tweeted on being told of Bolton’s op-ed:

“John Bolton was one of the dumbest people in government that I’ve had the ‘pleasure’ to work with. A sullen, dull and quiet guy, he added nothing to National Security except, ‘Gee, let’s go to war.’  Also, illegally released much Classified Information.  A real dope!”

Jeffrey Goldberg of The Atlantic had an extensive interview with former President Barack Obama, as the latter hawks part one of his memoirs.

On Republican complicity with Trump:

OBAMA: I did not believe how easily the Republican establishment, people who had been in Washington for a long time and had professed a belief in certain institutional values and norms, would just cave… To see figures in the Republican Party do a complete 180 on everything they claimed to believe previously is troubling.

On the crisis of disinformation:

OBAMA: If we do not have the capacity to distinguish what’s true from what’s false, then by definition the marketplace of ideas doesn’t work.  And by definition our democracy doesn’t work. We are entering into an epistemological crisis.

On Trump as Richie Rich, not John Wayne:

OBAMA: I think about the classic male hero in American culture when you and I were growing up: the John Waynes, the Gary Coopers, the Jimmy Stewarts, the Clint Eastwoods… Even if you are someone who is annoyed by wokeness and political correctness and wants men to be men again and is tired about everyone complaining about the patriarchy, I thought that the model wouldn’t be Richie Rich – the complaining, lying, doesn’t-take-responsibility-for-anything type of figure.

On the American idea:

OBAMA: America as an experiment is genuinely important to the world not because of the accident of history that made us the most powerful nation on Earth, but because America is the first real experiment in building a large multiethnic, multicultural democracy. And we don’t know yet if that can hold.

Peggy Noonan / Wall Street Journal

“No hard evidence of widespread fraud, no success in the courts or prospect of it.  You can have a theory that a bad thing was done, but only facts will establish it.  You need to do more than what Rudy Giuliani did at his news conference Thursday, which was throw out huge, barely comprehensible allegations and call people ‘crooks.’  You need to do more than Sidney Powell, who, at the same news conference, charged that ‘communist money’ is behind an international conspiracy to rig the U.S. election. There was drama, hyperbole, perhaps madness.  But the wilder the charges, the more insubstantial the case appeared.

“More than two weeks after the election, it’s clear where this is going.  The winner will be certified and acknowledged; Joe Biden will be inaugurated. But it’s right to worry about the damage being done on the journey.

“It’s one thing when supporters of the president say, simply, ‘Let’s go through the process and see where we are.’  It’s not bad to look into how messy the voting system is, not the worst to realize it needs long-term remedial attention. How did we devolve into a nation that no longer has an election night but an election month?

“But the sheer nuttiness surrounding the current mess is becoming deeply destructive. Online you see the websites read by millions saying the entire election system is shot through with criminality. The headlines read; It was stolen. We have proof of coordinated vote tampering. The president has many avenues to victory.  The Trump campaign sent an email under the name of formerly respectable Republican Newt Gingrich, once speaker of the House, saying ‘The Corruption is Unprecedented’:  ‘It’s time for us to get MAD.’  We can’t ‘roll over.’  ‘Please contribute $45 RIGHT NOW to the Official Election Defense Fund.’

“This isn’t a game.  America isn’t your plaything. Doesn’t Mr. Gingrich realize how dangerous it is to stoke people like this, to rev them up on the idea that holding even the slightest faith in the system is for suckers?

“Trump staff and supporters should know at this point that in trying to change the outcome they are doing harm – undercutting respect in and hope for democracy.  Republican senators and representatives, in their silence, are allowing the idea to take hold that the whole system is rigged.  This lessens faith in institutions and in their party’s reputation. Republicans were once protective of who we are and what we created in this democratic republic long ago.

“Now they’re not even protecting themselves; in future years what’s happening now will give their voters an excuse not to take part or show up.  What’s the point? It’s all rigged.

“And they are accepting a new postelection precedent, that national results won’t be accepted until all states are certified and all legal options, even the most bizarre and absurd, exhausted. Wait until this is used against you, in 2024 or ’28.  You won’t like it….

“Responsible Republican leaders ought to congeal and address the fact that what rough faith and trust we have in the system is being damaged. Which means our ability to proceed as a healthy democracy is being damaged.

“There is no realistic route to victory for the president, only to confusion and chaos and undermining.  He is not going to find the votes in recounts to win the election. Dominion, the voting-machine company under attack, has not been credibly charged with doing anything wrong.  As the Journal said this week in an editorial, ‘Strong claims need strong proof, not rumors and innuendo on Twitter.’

‘The irony is that this election will be remembered for the president’s attempts to sow chaos, not for what it actually appears to have been, which is a triumph for America.  In the middle of a pandemic, with new rules, there was historically high turnout.  Under stress the system worked.  Voters were committed, trusting, and stood in line for hours. There was no violence at the polls, no serious charges of voter suppression. In a time of legitimate hacking fears, there were no reports of foreign interference.  Our defenses held.  On top of all that, the outcome was moderate: for all the strife and stress of recent years, the split decision amounted to a reassertion of centrism….

“Imagine if (Trump) acted even remotely normal in his first term, if he’d had the intellectual, emotional and spiritual resources to moderate himself, to act respectably.  Heck, imagine if he’d worn a mask.  He might have won.

“He is set on going out like a villain. He and his people would find this Jacksonian – he’s refusing to bow to entrenched establishments!  He would think this is what his base wants – the old battler refusing to accept the illicit judgments of a decadent elite.

“If he were clever and disciplined, he’d do it differently.  He’d accept the election’s outcome, if not graciously at least with finality, go home to Mar-a-Lago, play golf, and have fun torturing his party by plotting his return. ‘I’ll be back.’

“Instead he leaves behind real and politically pointless ruin.”

---

Covid-19 death tolls, as of tonight….

World…1,377,527
USA…260,283
Brazil…168,662
India…132,764
Mexico…100,823
UK…54,296
Italy…48,569
France…48,265
Iran…43,896
Spain…42,619
Argentina…36,790
Peru…35,484
Russia…35,311
Colombia…34,929
South Africa…20,759

Source: worldometers.info

U.S. daily death tolls…Sun. 579; Mon. 739; Tues. 1,615; Wed. 1,965; Thurs. 2,065; Fri. 1,951.

Various states, including those run by Republican governors, have instituted lockdowns and/or mask mandates, as state after state reports record numbers in cases and deaths. 

According to the Department of Health and Human Services, 1 in 5 U.S. hospitals anticipate a critical staff shortage within seven days.

North Dakota, Missouri and Wisconsin reported the highest share, each with almost half of its hospitals in need of medical staff as of Wednesday.

A dearth of nurses, doctors and other key healthcare workers could not only endanger patients, but also risk burning out existing staff, many of whom have been struggling since March.

In Europe, such as in the UK, France, Germany and Spain, cases appear to be leveling off some, though at still catastrophic heights.  Poland’s case/death chart is sickening.

Covid Bytes

--Pfizer and partner BioNTech sought emergency use authorization from the Food and Drug Administration today, with Moderna to follow soon, for their coronavirus vaccines.  The FDA needs to examine the data and a decision could be forthcoming in roughly two weeks.

Moderna says its vaccine candidate remains stable at standard refrigerator temperatures of 36 to 46 degrees Fahrenheit for 30 days, and it remains stable for up to six months in a freezer set at minue-4 degrees Fahrenheit; much simpler than Pfizer’s candidate that needs to remain in super-cold storage – roughly minus-103 Fahrenheit.

Both Pfizer and Moderna’s vaccines require two shots over 3 or 4 weeks.

--Dr. Anthony Fauci projected Americans could expect their first doses of an approved coronavirus vaccine as early as April.

Front-line health care workers are expected to get their first doses by the end of December or early January.  After prioritizing people at risk of infection or severe disease, the healthy general population can expect first doses of a vaccine starting in April and through July if all continues on track.

If most of the population is vaccinated by summer and fall, Fauci said, people can start looking forward to returning to pre-pandemic normalcy.

But to get there, vaccine hesitancy must be overcome, especially in minority communities, the same that are being hit the hardest by Covid.

Hispanic or Latino people have been hospitalized at the highest rate, 4.2 times the rate of whites. African-Americans are at 3.9 times the rate of whites, according to figures from the CDC.

--An Oxford University study of healthcare workers on the frontline found that those who’ve had Covid-19 are highly unlikely to contract it again for at least six months after the first infection.

--The World Health Organization has released updated guidance on Covid-19 treatments recommending against the use of Gilead’s remdesivir for treating patients, regardless of the severity of their illness.

According to the WHO, the updated guideline was based on new data from four trials involving 7,000 patients. Data suggested that remdesivir had “no important effect on mortality, need for mechanical ventilation, time to clinical improvement and other patient-important outcomes.”

Gilead and the U.S. FDA disagree vehemently with the WHO’s stance.

--CNN’s Matthew Chance had a horrifying report on Russia’s Covid crisis. While the government shows off a new pop-up facility in a major ice rink with the latest equipment, outside Moscow the situation is dire, bodies piled up in the hallways of regional hospitals.

On Thursday Russia’s health minister urged regional leaders to take further steps to slow the spread as the number of daily deaths and infections hit new highs.

While authorities have resisted imposing lockdown restrictions across the country as they did earlier this year, they have imposed strict rules for wearing masks and gloves and underlined the importance of hygiene and social distancing.

--Iran is preparing for a wide-ranging lockdown to slow the spread, with more than 300 cities and towns slated for new restrictions that will inflict further pain on its sanctions-battered economy.

Iran’s official case load is now four times higher than during the first peak earlier this year, as the government reports more than 400 deaths daily, many believing the real total is far higher.

Under the lockdown Iran will close nonessential businesses in cities and towns with the highest risk of contagion.

--Turkey’s President Erdogan said on Tuesday that the government will impose tighter measures to fight the coronavirus and impose partial lockdowns on weekends across the country.  Erdogan also said all schools will remain closed until the year-end and all restaurants will only work by delivery.

--A fire last Saturday at a Romanian hospital treating coronavirus patients killed ten.  The fire broke out in one room of the intensive care unit and spread to an adjoining room.

--The issue of mink farms continues, with Ireland looking to cull 120,000 farmed animals on the State’s three remaining facilities in counties Laois, Kerry and Donegal.  The Department of Agriculture noted the Department of Health’s recommendation that continued mink farming raises the risk of mutated Covid-19 strains that could be passed to humans and affect the success of efforts to vaccinate the population during the course of next year.

But in Denmark, the agriculture minister has resigned, becoming the first in the government to fall in a growing scandal over an illegal order to kill all mink in the country, up to 17 million.

Center-left prime minister Mette Frederiksen is under fire as the justice ministry issued a report saying authorities broke the law and that the process was “reprehensive and regrettable.”

Denmark, the world’s largest producer of mink, sells most of the fur to China and Russia, but a new law proposed this week will ban farming of the creatures until 2022.

The cull descended into farce when the government was forced to concede it was only legal to kill infected mink and those within 8km of infected animals, which is kind of the policy adopted in the U.S., which is attempting to isolate individual farms, rather than issue a mass cull order.

Scientists are also now questioning how dangerous the mutation is.

--Canada’s top medical official said in a grim forecast on Friday that new daily cases of coronavirus in Canada could soar to 60,000 by the end of the year, up from less than 5,000 now, if people increase their daily contacts.

--Meanwhile, Australia’s once hard-hit state of Victoria has gone three weeks without a new Covid-19 case for the first time since February.

--Michael Gerson / Washington Post

“President Trump will be remembered for many things.  For the audacity of his mendacity.  For his ready recourse to prejudice. For his savant’s ability to rile and ride social resentment.  For his welcoming of right-wing crackpots into the Republican coalition.  For his elevation of self-love into a populist cause.  For his brutal but bumbling use of force against protesters. For his routinization of self-dealing and political corruption.  For his utter lack of public spirit and graciousness, even to the very end.  And, to be fair, for the remarkable achievement of winning more than 73 million votes without an appealing message, without significant achievements and without a discernible agenda for the future.

“But though Trump will be remembered for all these things, he will be judged for one thing above all: When the pandemic came and hundreds of thousands of Americans died, he didn’t give a damn.

“How do we know that? It is not easy to read a man’s heart.  But it is easier to detect that organ’s absence.  Trump is not only refusing to provide leadership during a rapidly mounting health crisis; he is also sabotaging the ability of the incoming Biden administration to cooperate with leaders at the Centers for Disease Control and Prevention, the National Institutes of Health and other government agencies.  By disrupting the presidential transition during an unfolding Covid-19 disaster, Trump is engaging in American history’s most deadly sulk.

“Even before his reelection loss, Trump had trouble expressing empathy for victims of the pandemic and their families.  Even after his own bout with Covid-19, he did not seem capable of feeling or imagining the suffering of others. This may reflect some psychological incapacity.  But it also indicates a certain view of pandemic politics.  From the start, Trump did not believe the disease itself was a true enemy.  Rather, he viewed the public perception of widespread disease as the real threat – the threat to his political future.  So the fewer Americans who believed in the disease’s spread, the better.  And the less attention that victims of the disease received, the better.

“This helps explain Trump’s own explanation, given to The Post’s Bob Woodward at the start of the pandemic. ‘I wanted to always play it down,’ the president said.  ‘I still like playing it down, because I don’t want to create a panic.’  A panic, after all, might spook the stock market, or make him appear responsible….

“In this cramped and selfish view of the world, every Covid-19 victim who is highlighted by the media is perceived by the president as an attack on himself.  And the public expression of sympathy on his own part would be self-sabotage, an admission of failure.  So when Trump recovered from the disease, he did not say, as former New Jersey governor Chris Christie did in a similar situation, ‘I should have worn a mask.’  Instead, Trump pronounced himself ‘immune,’ held dangerous, largely mask-less political rallies and used his own rapid recovery to play down the seriousness of the disease.

“Recovery from Covid did not change Trump’s perspective, and neither has electoral loss. The president is apparently too busy moping, golfing, fuming and lying to assume leadership during a spiraling health challenge. He has roused only enough interest to take personal credit for a prospective vaccine.  Once again, Trump does not seem to regard Covid-19 as a threat to the country requiring responsible action.  He sees the pandemic as an attack on his person, to be downplayed or denied.  This is egotism, turned cruel and deadly.

“The country will not be delivered by appealing to Trump’s better angels, who fled in disgust long ago.  It might help if elected Republicans stopped ignoring and enabling Trump’s lethal tantrum.  But the hours until noon, Jan. 20, still move too slowly.”

Trump World

--A “risk-limiting audit” found Joe Biden won Georgia by 12,284 votes, a narrower margin than the 14,196-vote lead he held immediately following the election. Local election administrators identified uncounted ballots in four counties. Each was the result of human error.

“Georgia’s historic first statewide audit reaffirmed that the state’s new secure paper ballot voting system accurately counted and reported results,” Georgia’s Secretary of State Brad Raffensperger, who ordered the recount, said in a statement. 

Biden is the first Democratic presidential candidate to win Georgia since Bill Clinton in 1992.

But because the margin of victory was under 0.5%, President Trump can still call for a recount.  Trump is reportedly furious with Georgia Republican Governor Brian Kemp for not doing more to overturn the outcome.

--Patrick Tucker / Defense One

“Five days ago, officials from both parties and across state and local governments issued a historic statement: ‘The November 3rd election was the most secure in American history.’

“Amid the worst global health crisis in living memory, a record number of Americans successfully and safely cast their vote in the U.S. presidential election. That they were able to do so, and that officials across the country could testify to the integrity of the vote, is due in no small part to the efforts of Christopher Krebs, who was fired tonight as director of the Cybersecurity Infrastructure Security Agency, or CISA.

“Krebs ran afoul of Donald Trump by refusing to let the president’s lies and baseless assertions about the election go unchallenged.  In one of his final tweets as CISA director, Krebs wrote, ‘ICYMI: On allegations that election systems were manipulated, 59 election security experts all agree, ‘in every case of which we are aware, these claims either have been unsubstantiated or are technically incoherent.’”

“For his efforts to secure America’s vote, Krebs was sacked by presidential tweet on Tuesday, nearly two years after Trump signed the legislation that created the agency under the Homeland Security Department.  His deputy, Matt Travis, also resigned, reportedly upon learning that he would not take Krebs’ place at the agency’s helm.  The acting director will likely be Brandon Wales, CISA’s senior career executive and executive director….

“On Election Day itself, CISA officials held background calls every few hours, updating reporters on what was happening and not happening. That was typical of Krebs, who was often as accessible to the press as to a state election officer.  Not all of these briefings were particularly interesting, owing only to the fact that it’s hard to make compelling copy out of steady progress.

“Krebs made more headlines by being fired than he did working.  Krebs’ summary dismissal brought swift rebuke from Sen. Mark Warner, D-Va., the vice chair of the Senate Intelligence Committee.

“ ‘Chris Krebs is an extraordinary public servant and exactly the person Americans want protecting the security of our elections,’ said Sen. Warner in a statement.  ‘It speaks volumes that the president chose to fire him simply for telling the truth.’

“Sen. Jack Reed, D-Rhode Island, ranking member of the Armed Services Committee, said, ‘This is an appalling move by President Trump. He is firing Mr. Krebs out of petty vindictiveness.  He clearly wants to remove officials who are in a position to rebut his misinformation… President Trump is still in denial.  But there is no getting around the fact that he lost the election fair and square and the results clearly show President-elect Biden won both the popular vote and in the Electoral College by a wide, significant, irrefutable margin.’

“That is the ultimate legacy of Christopher Krebs.  There is no serious dispute about the integrity of the 2020 elections.  There is only an incumbent who has lost. But America’s infrastructure remains secure. For now.”

--Historian Simon Schama’s tweet on Donald Trump:

“He’ll be remembered like some deranged Roman emperor from the pages of Suetonius or Gibbon, entirely indifferent to mass sickness and death, consumed only by the delusion of deified self-importance.”

--Dr. Scott Atlas tweeted, regarding Michigan and Gov. Gretchen Whitmer and renewed restrictions to fight the coronavirus surge in her state:

“The only way this stops is if people rise up. You get what you accept.  #FreedomMatters #StepUp.”

When told this was a rather obvious threat, Atlas then tweeted:

“Hey.  I NEVER was talking at all about violence.  People vote, people peacefully protest.  NEVER would I endorse or incite violence.  NEVER!!’

--Trump tweets:

[Since Wednesday]

“They didn’t even allow Republican Observers into the building to watch. A terrible insult to our Constitution!”

“The Georgia recount is a joke and is being done UNDER PROTEST. Even though thousands of fraudulent votes have been found, the real number is in matching signatures. Governor must open up the unconstitutional Consent Decree and call in the Legislature!”

“THEY WOULDN’T LET REPUBLICAN POLL WATCHERS INTO THE COUNTING ROOMS.  UNCONSTITUTIONAL!!!”

“In Detroit, there are FAR MORE VOTES THAN PEOPLE.  Nothing can be done to cure that giant scam. I win Michigan!”

“The Great State of Michigan, with votes being far greater than the number of people who voted, cannot certify the election.  The Democrats cheated big time, and got caught.  A Republican WIN!”

“BREAKING: The Wayne County Board of Canvassers has just unanimously voted to certify the results of the election & called on Michigan SOS Jocelyn Benson to conduct an audit of the unexplained precincts in Wayne County that did not match.

“…AND I WON THE ELECTION. VOTER FRAUD ALL OVER THE COUNTRY!”

“This was a rigged election.  No Republican Poll Watchers allowed, voting machine ‘glitches’ all over the place (meaning they got caught cheating!), voting after election ended, and so much more!”

“Lawyers now on @newsmax, @OANN & maybe @FoxNews.  An open and shut case of voter fraud. Massive numbers!”

“THE COVID DRUGS NOW AVAILABLE TO MAKE PEOPLE BETTER ARE AMAZING, BUT SELDOM TALKED ABOUT BY THE MEDIA!  Mortality rate is 85% down!”

“Evidence of voter fraud continues to grow, including 20,000 dead people on the Pennsylvania voters roll and many thousands all over the Country. Now, there has been an artificial number of votes in favor of Joe Biden.”

“Thousands of uncounted votes discovered in Georgia counties. When the much more important signature match takes place, the State will flip Republican, and very quickly. Get it done! @BrianKempGA”

“Voter fraud in Detroit is rampant, and has been for many years!”

“The Governor of Georgia, and Secretary of State, refuse to let us look at signatures which would expose hundreds of thousands of illegal ballots, and give the Republican Party and me, David Perdue, and perhaps Kelly Loeffler, a BIG VICTORY…

“…Why won’t they do it, and why are they so fast to certify a meaningless tally?”

“European Countries are sadly getting clobbered by the China Virus. The Fake News does not like reporting this!”

[Ed. Hey asshole…we are reporting on it.]

Wall Street and the Economy

On the economic data front, housing continued to be the star, with October housing starts coming in far higher than expected, a 1.53 million annualized pace, with existing home sales for the month at 6.85 million, up 26.6% year-on-year and the highest level since Feb. 2006, the latter as reported by the National Association of Realtors.

Home prices have climbed in recent months and the median existing-home price rose 15.5% from a year earlier to $313,000, a record high nominally and adjusted for inflation, NAR said.

“Home sales are just booming in the current environment,” said Lawrence Yun, NAR’s chief economist.  “The upper-end market is really flying.”

But economists say affordability is becoming a growing concern, even when weighing the impact of record-low interest rates, but the shortage of homes for sale, with record-low inventories, is leading to bidding wars, making it harder for first-time home buyers to enter the market.

Meanwhile, retail sales in October disappointed, up 0.3% from September’s revised downward 1.6% rise.  Ex-autos the figure was 0.2%, also less than expected.

October industrial production was solid, 1.1%.

But, in keeping with the surge in coronavirus cases across the U.S., weekly jobless claims rose to 742,000 from 711,000 the prior week, as reported by the Labor Department.  This is highly worrisome with new restrictions on activity being put in place all over the nation.

That said, the Atlanta Fed’s GDPNow barometer for the fourth quarter is at a strong 5.6%, though, again, this is before the Covid surge impacts data negatively.

S&P Global Economics said in a report today that real GDP will likely contract 4% in 2020 and grow a “modest” 3.9% in 2021 if a $500 billion stimulus package is passed before the end of the year.

Even with that boost, by the fourth quarter of 2023, real GDP would still be $115 billion, or 2.2%, smaller than what S&P Global expected in its December 2019 forecast.

The company said it estimates the risk of recession in the next 12 months at 25% to 30% due to both post-election tensions and “stimulus fatigue.”

So speaking of stimulus and federal programs already in place, Treasury Secretary Steven Mnuchin said he does not plan to extend several key emergency lending programs beyond the end of the year and asked the Federal Reserve to return the money supporting them, which could hinder President-elect Biden’s ability to use the central bank’s vast powers to cushion the economic fallout from the coronavirus.

The programs Treasury would not continue include one supporting the markets for corporate and municipal debt and one that extends loans to midsize businesses.  Investors had expected some or all of the programs to be kept operational as long as the pandemic continued to pose economic risks.

In a statement the central bank said: “The Federal Reserve would prefer that the full suite of emergency facilities established during the coronavirus pandemic continue to serve their important role as a backstop for our still-strained and vulnerable economy.”

Today, Mnuchin said Congress should use the money involved, some $454 billion, to help small companies with grants rather than loans.

Dallas Federal Reserve Bank President Robert Kaplan called for more fiscal support for the U.S. economy, particularly for state and local governments struggling with budget holes, and for the millions of unemployed who are spending down savings from prior aid.

“If the savings from those do run out you are going to see consumer spending get weaker,” Kaplan said at a conference today. “This hasn’t felt as much like a recession for a lot of businesses – it will start to, if you don’t have some renewal in some form of the fiscal relief.”

Lastly, on the trade front, the U.S. Chamber of Commerce said it was concerned the United States was being left behind after 15 Asia-Pacific economies on Sunday formed the world’s largest free-trade bloc, cementing China’s dominant role in regional trade.

The Chamber welcomed the trade-liberalizing benefits of the new Regional Comprehensive Partnership Agreement (RCEP), saying U.S. exporters, workers and farmers needed greater access to Asian markets.  But it said Washington should not join the bloc.

RCEP covers 30%  of the global economy and 30% of the global population, joining for the first time Asian powers China, Japan and South Korea.  It aims in coming years to progressively lower tariffs across many areas.

The United States is absent from both RCEP and the successor to the Trans-Pacific Partnership (TPP), leaving the world’s biggest economy out of two trade groups that span the world’s fastest-growing region.

Myron Brilliant, executive vice president of the Chamber, said the Trump administration had moved to confront unfair trade practices by China but secured only limited new opportunities for U.S. exporters in other parts of Asia.  Trump in early 2017 as one of his first official acts quit the TPP agreement, which Barack Obama had negotiated as part of a U.S. pivot to Asia.

Trump has not concluded any comprehensive new trade deals in Asia since then, Brilliant said. “(But) given the shortcomings of RCEP, we would not recommend the United States joining,” he said, without elaborating.

While U.S. exports to the Asia-Pacific market had increased steadily in recent decades, the market share of U.S. firms had declined.

Myron Brilliant and the Chamber know, however, that the U.S. should not have left the TPP, which was designed to gang up on China – Canada, Mexico, Chile, Peru, Australia, Brunei, Japan, Malaysia, New Zealand, Singapore and Vietnam.  All but the first four (highlighted) then joined Indonesia, Philippines, South Korea, Thailand, Cambodia, China, Laos and Myanmar in the RCEP.

The RCEP offers minimal benefits, which is no doubt what Myron Brilliant is referring to, but the TPP was the biggie and a Biden administration may attempt to rejoin it.

Europe and Asia

Nothing this week of note on the eurozone economy, though next week we get important flash PMI data for the region.  There are real concerns over a double-dip recession due to the new lockdowns as a result of the surge in coronavirus across the continent.

German Chancellor Angela Merkel, though, expressed optimism that the economy in her country, for one, Europe’s biggest, will come back strong.

“We must bring the numbers down and keep them at a low level,” Merkel said on Tuesday.  “And if that succeeds – we saw this in the third quarter of this year – then the economic recovery will significantly accelerate.”

But Merkel has faced resistance on some of her tougher restrictions from the country’s 16 state premiers.

Brexit: At week’s end, the EU and Britain are close to agreement on most issues as time runs out for a trade deal, but they are still at odds over the same items I’ve discussed for a year…fishing rights, guarantees of fair competition and ways to resolve future disputes, a senior EU diplomat told ambassadors in Brussels today.

“We are both close and far away.  It seems that we are very close to agreement on most issues but differences on the three contentious issues persist,” the official told Reuters.

The chief Brexit negotiators were forced to suspend direct talks on Thursday after a member of the EU team tested positive for Covid-19, but officials continued working remotely.

There is just six weeks to go.

A second EU diplomat said of the three main sticking points between negotiators: “They still need their time. Some things on the level playing field have moved, albeit very very slowly. Fisheries are not really moving anywhere right now.”

On a totally different topic, Boris Johnson announced plans to restore Britain’s navy to its position as Europe’s most powerful maritime force, highlighting that shipbuilding could also help heal divisions between the four nations of the United Kingdom.

With repeated polls suggesting most people in Scotland now support independence, Johnson was keen to press the case for how England and Scotland can work together.  He announced plans for 13 more frigates as well as committing to a new generation of warships, which he said would spur a renaissance in shipbuilding across the United Kingdom.  This will illuminate “the benefits of the union in the white light of the arc welder’s torch,” Johnson told parliament.  “If there was one policy which strengthens the UK in every possible sense, it is building more ships for the Royal Navy.”

Days earlier, Johnson had infuriated many Scots by calling the devolution of powers to Scotland “a disaster,” a comment that played into the hands of Scottish nationalists.

The Scottish National Party has made repeated calls for a new referendum on independence, with Johnson particularly disliked by the Scots because he is viewed as arrogant and patronizing.

So the prime minister is scrambling to make amends, such as in guaranteeing the future of Scotland’s Black Watch regiment, which has earned a fearsome reputation fighting in the British Empire’s campaigns, two World Wars, and more recently in Afghanistan and Iraq.

Turning to Asia…nothing of significance from China, while Japan released its GDP data for the third quarter, an annualized jump of 21.4%, rebounding sharply from a record postwar slump in a sign the country is gradually emerging from the damage caused by the pandemic.

But most economists expect the rebound to be moderate amid persistent weakness in consumption and a resurgence in infections at home and abroad.

The rise in GDP marked the first increase in four quarters and followed a 28.8% plunge in April-June.  On a quarter-on-quarter basis, the economy grew 5.0%, faster than forecasts of 4.4%. 

Meanwhile, Japan’s core consumer prices fell in October at their fastest annual pace in nearly a decade as the boost from last year’s sales tax hike petered out, heightening fears of a return to deflation.

Core consumer prices, which exclude fresh food costs, fell 0.7% in October from a year earlier, the third straight month of declines and the biggest year-on-year drop since March 2011.

Finally, we had flash November PMI data in Japan, 48.3 on manufacturing (50 the dividing line between growth and contraction) vs. 48.7 in October, with services down to 46.7 vs. 47.7.

Street Bytes

--Stocks finished mixed as concerns over the surging coronavirus and new restrictions limiting economic activity across much of the nation mitigated the positive impact of the ongoing good news on the vaccine front.

Monday, both the Dow Jones (29950) and S&P 500 (3626) hit new closing record highs before falling back the balance of the week, -0.7% and -0.8%, respectively, while Nasdaq eked out a gain of 0.2%.

The market itself is outrageously overvalued, trading at a trailing P/E of 40 on the S&P 500, and a historically high 22 on 2021’s projected earnings.

--U.S. Treasury Yields

6-mo. 0.09%  2-yr. 0.16%  10-yr. 0.82%  30-yr. 1.52%

The long end of the curve rallied on prospects for a slowing economic recovery amid the surge in the pandemic.

--Judy Shelton’s nomination to fill one of two remaining open seats on the Federal Reserve’s Board of Governors failed to advance to a final vote on Tuesday, a significant setback but one that does not end her chances at ultimately winning confirmation.

Senator Mitch McConnell took steps that will allow him to bring up the nomination again, but her failure to clear a closely watched procedural vote signaled a tough road ahead for President Trump’s nominee,

Trump announced he would nominate Shelton 16 months ago, but her confirmation has been held up time and time again by lawmakers’ skepticism over her views – including being a loyal fan of the president and a longtime proponent of some sort of gold standard, which most economists oppose.

--Less than two years after all Boeing 737 MAX planes were grounded following two deadly crashes, the Federal Aviation Administration Wednesday gave the company the green light to fly again.

“We will never forget the lives lost in the two tragic accidents that led to the decision to suspend operations,” David Calhoun, CEO of Boeing, said in a statement.

“These events and the lessons we have learned as a result have reshaped our company and further focused our attention on our core values of safety, quality and integrity.”

FAA Administrator Steve Dickson officially rescinded the grounding order Wednesday morning after determining that both crashes “involved a common cause” and beginning “proceedings to address the unsafe condition.”

A report from the House Committee on Transportation and Infrastructure blamed both the plane manufacturer and the FAA for “a horrific culmination of a series of faulty technical assumptions by Boeing’s engineers, a lack of transparency on the part of Boeing’s management and grossly insufficient oversight by the FAA.”

Boeing said Wednesday that it has spent the past 20 months working “closely with airlines, providing them with detailed recommendations regarding long-term storage and ensuring their input was part of the effort to safely return the airplanes to service.”

Before lifting off again, all 737 MAX planes must install software enhancements, complete wire separation modifications, conduct pilot training and “accomplish thorough de-preservation activities that will ensure the airplanes are ready for service.”

--American Airlines Group said on Wednesday it would make good on its plan to return the 737 MAX to passenger flights by the end of 2020.  American said it will begin with non-commercial flights in early December before resuming passenger flights later in the month.  The airline said it will operate two flights a day, or one round-trip between Miami and New York from Dec. 29 to Jan. 4.

United Airlines announced plans to return the 737 MAX to service in the first quarter of 2021. Southwest Airlines, the world’s largest MAX operator, said in October it does not plan to fly the aircraft until the second quarter of 2021.

So will passengers return?  The airlines certainly aren’t going to be advertising, “Hey, the MAX is back!”

--Low-cost carrier Norwegian Air Shuttle is seeking bankruptcy protection in Ireland, where its fleet is held, saying the decision was “in the interest of its stakeholders.”

“Norwegian will continue to operate its route network and both its bonds and shares will trade as normal on the Oslo Stock Exchange,” the carrier said.

Like other airlines, its fleet is now mostly grounded as the pandemic caused a near-total halt to global travel.

Earlier this month, the Oslo-based company said it was facing a “very uncertain” future after the Norwegian government turned down its request for additional financial support.  The government said that the airline had been struggling financially even before the pandemic and that aid should be targeted first at healthy businesses.

After that, Norwegian announced it had to lay off another 1,600 staff and ground 15 of the 21 planes it had been flying with.

--The U.S. Travel Association projects travel spending is expected to fall by more than $500 billion in 2020 and is not expected to recover to pre-coronavirus levels until 2024.

The trade group projects spending in 2020 will be $617 billion, down from its July forecast of $622 billion, compared with $1.13 trillion in 2019.  The decline reflects the dramatic falloff in business travel.  The group said the industry has lost nearly 40%, or 3.5 million, of all direct travel jobs and warned another 1 million jobs could be lost without additional government relief by year-end.

As for the TSA Checkpoint travel numbers for 2020 vs. 2019…the last seven days were at 37, 34, 32, 38, 41, 39 and 36 percent of 2019 daily figures.

--Related to the above, travelers are calling off holiday trips as Covid-19 case counts surge around the country.  Thursday, United Airlines reported bookings have slowed and cancellations have risen over the last week.  Southwest said last week that new bookings have slowed and has said cancellations have picked up.  Alaska Air Group said renewed state and local restrictions on travel and public gatherings have “negatively impacted demand in the immediate term.”

“We’ve seen a dampening of demand,” American Airlines Group Inc. President Robert Isom said at an industry event Thursday.

--The national airline of the United Arab Emirates is launching its first-ever daily route to Israel – two months after the countries established diplomatic ties.

Etihad served Tel Aviv for the first time on Oct. 19, and now plans to operate the trip on a daily basis starting March 28, 2021, the carrier said in a statement.

The flight into Abu Dhabi will be timed to provide connections to China, India, Thailand and Australia.

--Last week I wrote of China’s home-grown C919 passenger jet – part of the nation’s ambitions to break the current Boeing-Airbus duopoly on the manufacturing of large passenger aircraft.

But as pointed out in the South China Morning Post this week, the C919 relies on imports of a number of crucial parts, from its engines to its flight-control systems, which means it needs access to the likes of suppliers General Electric, Honeywell International and Rockwell Collins for future deliveries of the new model and the administration of president-elect Joe Biden is likely to continue the Trump administration’s effort to contain China technologically.

China is looking to rollout the C919 (for show, not mass production) next year and the state-owned company building the plane, Comac (Commercial Aircraft Corporation of China) says this is still the schedule.

Comac is hoping to get all the necessary certificates by the end of 2021, but some are now talking 2022 or 2023, depending on whether items such as GE’s LEAP-1C engine are prohibited from being sold to Comac.  The Trump administration did grant GE a license to sell the engines to the Chinese company, but a recent executive order issued by President Trump calls the sale into question.

Just how pragmatic a President Biden will be on the U.S.-China relationship is a big issue, as to whether U.S.-built components for the C919 will be blocked or not.

A Biden administration could, for example, allow the sale of components to Comac, but prohibit the C919 from entering and landing in the U.S., something of that sort.

--Walmart turned out another outstanding quarter as the world’s largest retailer powers through a pandemic that has felled other national chains.

Third-quarter profits surged 56% and revenue hit $133.75 billion, a 5.3% increase, both better than the Street projected.  Online sales spiked nearly 80% after nearly doubling in the previous quarter (the height of the national lockdown).

Same-store sales rose 6.4%.

Walmart’s expansion into online grocery is widening the gap with rivals.  In September it launched a membership program to deliver what people want more than ever these days as they reduce their public exposure: convenience.

Big box stores are thriving even as thousands of retail stores and national chains suffer.  Kohl’s, for example, saw its sales drop 13.3% in Q3 and it lost money.

As infections soar across the country, Walmart is spreading out its traditional Black Friday sale over three separate events in November.  Some of the most enticing offers are going online to encourage customers to stay at home.

Meanwhile, Walmart is retreating further from efforts to expand internationally, announcing Monday it would sell off 85% of its Japanese supermarket subsidiary Seiyu in a deal valued at $1.6 billion.  It said earlier this month it was backing out of Argentina.

Last month, Walmart said it would sell its British supermarket chain Asda for $8.8 billion, though it will keep a minority stake.

--Target reported a surge in third-quarter sales and earnings on Wednesday as the retailer saw a jump in demand for its same-day services including online ordering and pick-up as it looks ahead to the key holiday season.

Revenue was up 21% year-on-year to $22.63 billion, beating expectations, while adjusted earnings handily beat the Street as well.

“Our strong results in 2020 reflect the benefits of our multi-year effort to build a durable and flexible model, with a differentiated assortment and a suite of industry-leading fulfillment options,” said CEO Brian Cornell.  “The result is unprecedented market share gains and historically strong sales growth, both in our stores and our digital channels.”

Comparable sales in the three months through Oct. 31 jumped almost 21% as store sales rose 9.9% and digital comp sales were up 155%.

The company joined other retailers in extending holiday shopping deals for a longer period of time, including Black Friday sales, to cut back on in-store crowds.

Cornell said: “In a holiday season that will feel different for our guests, we’re committed to helping them navigate the season safely, as they find new ways to celebrate with family and friends.”

--Back to Kohl’s, its sales in the third-quarter were $3.98 billion, down from $4.63 billion, while it reported an adjusted profit of a penny per share in the quarter ended Oct. 31.

“I continue to be very proud of how our organization is navigating through the Covid-19 pandemic,” CEO Michelle Gass said in a statement.  “Our third-quarter results exceeded our expectations with significant sequential sales and profitability improvement.”

Digital sales were 32% of Kohl’s total sales in the quarter, as they try and catch up with the likes of Walmart and Target in growing the online platform.

--Macy’s reported its quarterly performance Thursday and sales dropped from a year earlier, though not as much as expected.

Revenue in the three months through Oct. 31 decreased to $3.99 billion from $5.17 billion a year earlier, with the retailer swinging to an adjusted loss of $0.19 a share from a profit of $0.07 previously, but this, too, was far better than anticipated.

Comparable sales were down 21%, while the Street expected a drop of more than 23%.  Digital sales were up 27% from the third quarter of 2019, Macy’s said.

--Home-improvement giant Home Depot reported net earnings that beat expectations, $3.43 billion, as sales totaled $33.54 billion for the three months ending Nov. 1, up 23.2%, from $27.22 billion for the prior-year period, also exceeding the Street’s forecasts.

Comparable store sales were up 24.1%, and U.S. comp sales rose 24.6% during the period, far ahead of estimates.

Home Depot also said it will spend about $1 billion more on employees’ compensation annually as the home improvement chain benefits from a sustained surge in demand for tools, paint and building materials due to the pandemic.

With limited options for travel or leisure activities, Americans are spending more time at home and using their discretionary income on minor home remodeling and repair work.

HD announced it would also buy HD Supply Holdings Inc. in a deal valued at about $8 billion.

--HD rival Lowe’s reported adjusted earnings that beat analysts’ expectations, while sales totaled $22.31 billion, up from $17.39 billion for the prior-year period at the home improvement retailer, also better than the Street’s forecasts.

Comparable sales increased by 30.4%, and online sales more than doubled during the quarter ended Oct. 30.

But the Street was disappointed in the company’s outlook for Q4, which was basically in line with current estimates, which in today’s frothy market isn’t good enough, so the shares dropped about 8% on the news.

--Shares in Beyond Meat rallied after the company said it launched a plant-based minced pork product in China, seeking to tap into the growing demand for its products in the lucrative Asian market.  Beyond Pork will initially be available at five popular restaurants in Shanghai.

--Tesla Inc. is being named to the S&P 500 index, entering Dec. 21 following months of speculation after the stock failed to make the cut during the index’s quarterly rebalancing in early September.  The anticipation has helped drive a nearly fivefold rally in the stock this year, and it will instantly become one of the index’s most influential members.  The company that Tesla is to replace in the index will be named later.

Tesla shares rose as much as 20% on the week and now have a market cap of $464 billion.

--JPMorgan Chase CEO Jamie Dimon took thinly veiled jabs at President Trump for refusing to concede the election, even as he lashed out at lawmakers over stalled stimulus talks and warned that the pandemic is far from over.

“There will be a new president sworn in on January 20,” Dimon told the New York Times’ Dealbook conference.  “We need a peaceful transition. We had an election and we have a new president.  You should support that whether you like it or not because it’s based on a system of faith and trust.”

Dimon was cautiously optimistic about recent breakthroughs on a Covid-19 vaccine but hammered home the point that the crisis is far from over and that “we need fiscal stimulus.”

Dimon is irked Congress remains deadlocked on passing a second relief bill despite the virus becoming more widespread than ever.

“Now we have this big debate ‘Is it $2.2 trillion, $1.5 trillion?’  You gotta be kidding me!’ Dimon exclaimed.  “I mean just split the baby and move on! This is childish behavior on the part of our politicians.”

--Former President Barack Obama’s memoir sold more than 887,000 copies on Tuesday, a rather stunning debut that publisher Penguin Random House said marked the largest first-day sales for any book it had ever published.

The sales included all formats and editions in the U.S. and Canada, as well as preorders.

“A Promised Land,” the first volume of Mr. Obama’s account of his career and years in the White House, slightly outpaced wife Michelle’s opening-day sales of her memoir, “Becoming,” which sold more than 725,000 copies its first day of publication in 2018 and has now logged total sales of more than 14 million copies world-wide in all formats.

Penguin Random House’s parent, German media company Bertelsmann SE, paid an estimated $60 million for the global publishing rights to the books by the Obamas.

Demand was so strong for “A Promised Land” that Penguin Random House increased its print run to 3.4 million copies, up from an original run of 3 million.

Political books have been hot this year.  Mary L. Trump’s memoir “Too Much and Never Enough: How My Family Created the World’s Most Dangerous Man,” sold more than 950,000 copies in the U.S. on July 14, the day it went on sale.

Journalist Bob Woodward’s “Rage” sold 600,000 copies in all formats in its first week on sale in the U.S., while John Bolton’s memoir “The Room Where It Happened” sold more than 780,000 copies in that time frame.

--BuzzFeed Inc. has agreed to acquire HuffPost from Verizon Media in a stock deal, uniting two of the bigger players in digital media.  Under the pact, the companies will syndicate content on each other’s platforms and look to jointly explore advertising opportunities. Verizon Media will get a minority stake in BuzzFeed as a result of the tie-up, the companies said.

Jonah Peretti, BuzzFeed’s founder and chief executive, will run the combined company.

Foreign Affairs

Afghanistan: The Pentagon announced Tuesday that it was halving the number of troops it has in Afghanistan within the next two months, reducing from about 5,000 to 2,500, while also cutting the force level in Iraq from 3,000 to 2,500 by Jan. 15.  President Trump had sought to remove all American troops from Afghanistan, while senior U.S. military officials wanted to maintain the current numbers.  In October, the president tweeted that all U.S. troops should be “home by Christmas.”

The announcement was made by acting defense secretary Christopher C. Miller and came eight days after he took over for ousted defense secretary Mark Esper, who had argued the conditions on the ground in Afghanistan did not warrant such troop reductions.

Esper cited a recent surge in Taliban violence, safety concerns for remaining U.S. troops, possible damage to alliances and the possibility that reducing troops would damage prospects for securing a landmark deal between the Taliban and the Afghan government.

Miller took no questions, nor did he mention Esper’s dissent.  Curiously, the chairman of the Joint Chiefs of Staff, Army Gen. Mark A. Milley, did not appear alongside Miller at the lectern.

Editorial / Wall Street Journal

“Pentagon officials on Monday confirmed our report Sunday night that President Trump is expected to order another troop reduction in Afghanistan – with a deadline conveniently timed just before he is likely to leave office on Jan. 20.  We wish there was some justification other than the looming end of his Presidency.

“There’s certainly no military rationale for reducing U.S. forces to 2,500.  The current 4,500 level was recommended earlier this year by Army Gen. Scott Miller, the U.S. commander in Afghanistan, when Mr. Trump demanded a reduction from 8,000.  The 2,500 looks like a number pulled out of a Pentagon helmet as an arbitrary alternative to the disastrous total pullout Mr. Trump was contemplating last week.

“The smaller force by Jan. 15 means something will have to give in the U.S. mission that includes support for Afghan forces, coordinating the use of air power, intelligence gathering, and counterterror operations against al Qaeda and Islamic State. At some point, low troop levels become a risk to U.S. soldiers because they can’t supply adequate force protection.

“Mr. Trump says it’s time to go because we’ve been there 19 years, and that’s enough.  But that’s a political notion put into his head by the loyalists he has placed in charge of the Pentagon in the last few days.  The rushed reduction in forces will reinforce the Taliban’s view that they needn’t compromise in negotiations with the Afghan government because the Americans are desperate to depart.

“A clear-eyed view of the stakes came Monday on the Senate floor from Majority Leader Mitch McConnell.  ‘A rapid withdrawal of U.S. forces from Afghanistan now would hurt our allies and delight the people who wish us harm.  Violence affecting Afghans is still rampant. The Taliban is not abiding by the conditions of the so-called peace deal,’ Mr. McConnell said.  ‘The consequences of a premature American exit would likely be even worse than President Obama’s withdrawal from Iraq in 2011, which fueled the rise of ISIS and a new round of global terrorism.  It would be reminiscent of the humiliating American departure from Saigon in 1975.

“The Republican leader added: ‘We’d be abandoning our partners in Afghanistan, the brave Afghans who are fighting the terrorists and destroying the government’s leverage in their talks with the Taliban to end the fighting. Our retreat would embolden the Taliban, especially the deadly Haqqani wing, and risk plunging Afghan women and girls back into what they experienced in the 1990s.  It would hand a weakened and scattered al Qaeda a big propaganda victory and a renewed safe haven for plotting attacks against America.  And it would be welcome news to Iran, which has long provided arms and support to the Taliban and explicitly seeks our retreat from the Middle East.’

“Joe Biden’s advisers have said they favor keeping a residual force in Afghanistan, but they can’t know how many troops that requires until they consult with Gen. Miller and Chairman of the Joint Chiefs Mark Milley.  Let’s hope the generals can follow Mr. Trump’s misguided orders in a way that offers Mr. Biden more options than retreat after he’s in the White House.”

Katie Bo Williams / Defense One

“In Afghanistan, the Taliban still has not renounced al-Qaida – a key precondition for withdrawal in the U.S.-Taliban agreement inked last February.  The insurgent group has also upped its attacks in recent months, with October seeing the highest civilian death toll in Afghanistan in over a year….

“It was a jarring juxtaposition that appeared to be an effort to balance the political demands of a president eager to take credit for ‘ending’ wars with the deep concerns of Republican lawmakers on Capitol Hill.

“ ‘We owe this moment to the many patriots who made the ultimate sacrifice and their comrades who carry forward their legacy,’ Miller said.  ‘In light of these tremendous sacrifices, and with great humility and gratitude to those who came before us, I am formally announcing that we will implement President Trump’s orders to continue our repositioning of forces from those two countries.’

“Miller caught himself after mistakenly saying that the United States would meet a withdrawal deadline of Jan. 15, ‘2001’ – accidentally conflating 2021 with the year the Afghanistan conflict began….

“Defense officials insisted earlier on Tuesday that the proper conditions had been met to allow the troop drawdowns without damaging U.S. national security or the ongoing mission to support Taliban-Afghan peace talks that are meant to end the war in Afghanistan. But they refused to answer repeated questions about which conditions had been met, and they declined to address a recent, classified memo from former Defense Secretary Mark Esper warning the White House that the situation on the ground in Afghanistan had not progressed enough to allow further troop cuts.

“That memo, reported by the Washington Post, warned of the ongoing attacks by the Taliban, the risk that a rapid pull-out would endanger the remaining U.S. troops, potential damage to the ongoing peace negotiations and possible damage to alliances….

“The move also earned a swift rebuke from NATO General Secretary Jens Stoltenberg, who said Tuesday, ‘NATO went into Afghanistan after an attack on the United States to ensure that it would never again be a safe haven for international terrorists’ and warned that the ‘price for leaving too soon or in an uncoordinated way could be very high.’”

Iran: President Trump asked for options on attacking Iran’s main nuclear site last week but ultimately decided against taking the dramatic step, four current and former U.S. officials said on Monday, according to the New York Times.  Trump made the request during a meeting with his top national security aides, including Vice President Mike Pence, acting defense secretary Christopher Miller, Secretary of State Pompeo and Joint Chiefs of Staff Chairman General Mark Milley.

Any strike would almost certainly be focused on Natanz, where the International Atomic Energy Agency reported last week (as I wrote in my last review) that Iran’s uranium stockpile was now 12 times larger than permitted under the nuclear accord that Trump abandoned in 2018.

It is clear Trump, in looking to take such an action, is seeking to poison relations with Tehran further so that it would be harder for the incoming Biden administration to revive the 2015 Iran nuclear accord, as he has promised to do.

Israel: Secretary of State Mike Pompeo paid the first visit by such a high-level U.S. official to an Israeli settlement in the occupied West Bank, in a parting show of solidarity with Prime Minister Benjamin Netanyahu.

Palestinians accused Pompeo, who then went to the occupied Golan Heights after, of helping Israel cement its hold on West Bank land they seek for a state.

Pompeo announced a year ago that the United States no longer viewed Israel’s settlements on land it captured in the 1967 Middle East war as “inconsistent with international law.”

In the West Bank, Pompeo toured the Psagot settlement’s winery – after it named one of its wines after him.

Netanyahu praised President Trump in his meeting with Pompeo for recognizing Jerusalem as Israel’s capital and Israeli sovereignty over the Golan, which Israel annexed in 1981 in a move few countries have accepted.

“The simple recognition of this (the Golan) as part of Israel, too, was a decision President Trump made that is historically important and simply a recognition of reality,” Pompeo said.

Hana Ashrawi, a veteran Palestinian negotiator, accused Pompeo of using Trump’s final weeks in office “to set yet another illegal precedent, violate international law and perhaps to advance his own future political ambitions.”

Yes, Ms. Ashrawi is right.  Pompeo is set on advancing his own future ambitions.  To that end, he said in a statement on Thursday that the United States will require imports from Israeli settlements in the occupied West Bank be labelled as having been “Made in Israel” or “Product of Israel.”  In the past such settlement products were labeled as “Made in West Bank.”

Separately, Israel struck Iranian and Syrian targets in Syria early Wednesday in response to explosive devices found on the border the previous day.

“IDF warplanes attacked military targets belonging to the Iranian Quds Force and the Syrian army tonight in Syria,” the IDF said in a statement.

Among the targets hit was an Iranian military complex near Damascus International Airport.

China: With 60 days remaining before the inauguration of Joe Biden, a spike in tensions between the U.S. and China on issues such as Taiwan and the South China Sea seems a virtual certainty.

Or the Trump administration could label China’s persecution of minority Uighurs in Xinjiang as “genocide,” imposing more sanctions on Chinese companies or providing more support for Taiwan.

As Wu Xinbo, director of the Centre for American Studies at Fudan University in Shanghai told the South China Morning Post:

“Trump has blamed China for the spread of the pandemic and may think that has cost him the election,” Wu said.

“People like (Sec. of State) Pompeo and (White House trade adviser Peter) Navarro will also seize their last chance to sabotage Sino-U.S. relations.”  [And thus make things worse for Joe Biden.]

Azerbaijan and Armenia:  The ceasefire is holding, but the ethnic animosity in Nagorno-Karabakh is only growing.  Many Christian Armenians are leaving the area after living with the Muslim Azeris in the region for decades.

Said one Armenian to the Associated Press as his village was to come under Azeri control, "In the end, we will blow it up (his home) or set it on fire, in order not to leave anything to Muslims.”

Ethiopia: The situation here with a restive region exploded over the weekend, as northern rebels in Tigray said they promised “hell” on Ethiopian troops in a two-week war threatening the vast nation’s unity and further destabilizing the Horn of Africa.

The war has killed hundreds, sent 30,000 refugees into Sudan, which the UN is labeling another humanitarian crisis, and called into question whether Africa’s youngest leader can hold together Ethiopia’s myriad fractious ethnic groups.

Prime Minister Abiy Ahmed’s government says its forces are marching on Tigray’s capital and will soon triumph over the local ruling Tigray People’s Liberation Front (TPLF), which is accused of revolt.

The TPLF says Abiy has removed Tigrayans from senior security and government posts since he took office in 2018 and now wants to dominate them completely.

Abiy’s government has put former officials – many Tigrayan – on trial for crimes like torture, murder and corruption, but denies any attempt at ethnic domination.

Ethiopia’s army is one of Africa’s strongest, but many officers were Tigrayan and much of its heavy weaponry was based in Tigray, on the front line of the standoff with Eritrea after a 1998-2000 war.

So here’s the irony in this conflict.  Abiy won last year’s Nobel Peace Prize for a pact with Eritrea.

Separately, gunmen in western Ethiopia killed at least 34 people in an attack on a bus Saturday night.  I didn’t see who claimed responsibility.

Peru: Congress on Monday chose legislator Francisco Sagasti as caretaker president, in an attempt to defuse a sharp political crisis after angry protests and the departure of two presidents in the past week.

Sagasti, 76, will assume the presidency ahead of national elections called for April.  He comes after interim leader Manuel Merino resigned on Sunday, five days after being sworn in following the ouster of centrist Martin Vizcarra.

Vizcarra was popular with many Peruvians, but angered lawmakers with his anti-corruption measures, and his removal sparked days of protest that led to the deaths of two men.

Sagasti, a former World Bank official and engineer, has a formidable challenge in bringing stability to the world’s No. 2 copper producer, which was already hard hit by Covid-19 and heading for its worst economic contraction in a century.

Random Musings

--Mark Penn / Wall Street Journal

“The more things change, the more they stay the same – or so it seems in American politics, after the electorate returned the Democratic establishment to power after rejecting it for a rogue outsider four years ago. The surprise finding of the exit polls is that moderates and men provided the crucial swing voters who put Joe Biden into office.

“Has the American electorate changed?  The answer is that despite billions of dollars spent on persuasion, massive increases in turnout, a media with an agenda, and racial unrest, the changes in American voting patterns were miniscule.

“We are one country divided by two parties.  The nation is largely moderate, practical and driven by common sense over ideology.  Most voters prefer compromise on health care, immigration, stimulus and other thorny issues that the extremes of the parties have pushed to the limits.  Only 24% of voters identify as liberal, while 38% say they’re conservative, according to CNN exit polls. Another 38% are moderate. Despite the widespread publicity given the left, since 2014 – a good year for Republicans – the percentage of self-identified liberals declined 2 points, while the share of conservatives increased 3 points.

“By now everyone has heard that President Trump did worse in the suburbs and better with minorities than in 2016. While technically true, the suburban swing occurred before the 2018 midterms, and the minority shift was relatively small, except for Hispanic voters in Florida and the border towns of Texas.  [Ed. this is what my comparison last week proved.]  Some surprising findings have been overlooked.  Mr. Trump’s margin of victory among white women increased from 11 to 13 points, according to CNN’s final adjusted exit polls. But his advantage among white men narrowed from 30 points to 23.

“Mr. Biden won almost all the liberals and Mr. Trump the conservatives.  But Mr. Biden expanded the Democratic lead among moderates to 30 points from 12 in 2016 – the single most significant change.  Moderate men swung the race to Mr. Biden….

“When it comes to polling, the final Hill-Harris Poll got it about right, with a 4-point gap in favor of Mr. Biden.  We saw the momentum in the race seesaw in the last month and end up on Mr. Trump’s side as he ramped up his mass rallies  Prominent national polls, such as from The Wall Street Journal/NBC, CNN and Quinnipiac, predicted 10- to 12-point margins, which would have produced about a 40-state landslide – a result that on its face should have been dismissed as impossible.  Many pollsters will have to rebalance their models to reflect a more conservative and Republican country or continue to report erroneous results – not only in the campaign horse races, but also on key issues….

“Mr, Biden came close to waking up another Hillary Clinton, but his votes fell on this side of victory in key states by small margins. The message from the voters is that we are not divided into two extreme camps. Rather, they are more centrist in nature and outlook, and that a president who governs too far to the right or left is likely to be left behind in the next election.”

--Interesting election tidbit from the Brookings Institution, via Ian Bremmer:

Biden:

477 counties won

Counties account for 70% of U.S. GDP

Trump:

2,497 counties won

29% of GDP

--Rep. Denver Riggleman (R-Va.) / USA TODAY…Riggleman a former U.S. Air Force Intelligence Officer.

“By now, we’re all keenly aware of the threat posed by the novel coronavirus and we all know firsthand how our race to meet that threat head-on has altered the way we learn, do business and interact with each other.

“But another sea change is coming.  The stupendous rise in the popularity and prevalence of conspiracy theories threatens to undermine the basis for civil discourse in America.  Conspiratorial paranoia is spreading like a psychological virus through the American population.  If we can’t stop that virus from festering in the American consciousness, the fate and the future of normal American politics is at stake.  To see why, you have to get into the mindset of a conspiracy theorist.

“Major conspiracy theorists like QAnon have been making headlines in recent weeks and months, and it’s all too obvious why.  What could be more interesting or even alarming in an election year than that 56% of Republicans and about half of Trump supporters believe the claims by QAnon that senior Democrats and political officials are leading a satanic cabal of pedophiles and that Donald Trump is the only one who can stop them?

“Like most other conspiracy theories, QAnon is less like a set of fixed beliefs and more like a symptom of a mental disease.  The claims advanced by conspiracy theorists may be baseless, even outrageous and grotesque at times, but that’s a feature, not a bug.  The temptation is to think that conspiracy theories are well-meaning attempts, however deranged, at explaining reality.  Quite to the contrary, conspiracy theories are far less about making sense of the world and far more about finding an outlet for a seething morass of paranoia, suspicion and distrust. They are weaponized stupidity and monetized myth.

“Conspiracy theories feed, not on facts, but on fantasy. That means most conspiracy theories are incredibly malleable and amorphous at their core.  Take the anti-Semitic conspiracy behind the Protocols of the Elders of Zion as an example. The belief that Jewish people somehow command and control political, social and economic realities has taken a variety of different forms over the decades, even centuries, of its existence.  Hardly anyone today believes in all of the literal claims of the original Protocols document.  But that hasn’t stopped the same pattern of thinking, the same psychology, from recurring again and again in new forms.  In many respects, QAnon itself is a modern-day rehashing of this same old anti-Semitism.

“That flexibility and malleability makes it difficult, if not impossible, to defeat a conspiracy theory for good.  Almost anything that increases feelings of uncertainty, distrust and confusion can act as a viral vector for a new and mutated infection by conspiratorial thinking.  Digital media only exaggerates this feature of conspiracy theories.  Today’s prophets are no longer flesh and blood, but anonymous posters.  This anonymity, coupled with the power of digital media to reach anyone at any time, massively increased the resilience and lifespan of conspiracy theories.

“QAnon is perhaps the paradigmatic example of this. QAnon isn’t surging in popularity because people are unearthing more and more evidence that its central contentions are true. Rather, people feel more and more scared and paranoid, and QAnon provides an outlet.  The digital prophet behind QAnon can capitalize off of uncertainty and ignorance to get more and more people to drink the Kool-Aid.  In our post-truth world rife with uncertainty, misinformation, and doubt, conspiracy theories capture the imagination of the paranoid and the fearful with incredible ease.

“But QAnon is not alone.  Across the political spectrum, conspiracy theories abound. And while they may seem silly or too outlandish to be significant, they are far from harmless.

“Many conspiracy theories explicitly and unashamedly dehumanize whole groups of people.  Yet above and beyond the very real threat of violent extremism and domestic terrorism posed by a dehumanizing conspiracy, widespread paranoia erodes the possibility of civil discourse in our society today.  You can’t have a conversation about facts, policies, or positions if one side of the debate is fundamentally convinced that the other is satanic and evil.  At that point, we don’t have political disagreements anymore; instead, we have moral and spiritual warfare.  When paranoid fantasy takes the place of reality in the minds of millions of Americans, we can’t expect politics as usual to function for very long….

“In the meantime, ordinary Americans have their work cut out for them dealing with friends, family members and coworkers who have been sucked in by conspiracies.  My only advice is that we, as a nation, have to practice an unprecedented degree of courage to speak out against conspiracy theories and challenge misinformation whenever and wherever we find it.  I can’t say whether that will be enough. But I know that if we don’t get courageous now, pretty soon it will be too late.”

--I didn’t have a chance last time to comment on this topic, but, boy, former Auburn football coach and now incoming Alabama Sen. Tommy Tuberville is just a real Albert Einstein, isn’t he?

Tuberville, who won the Republican primary over former Senator Jeff Sessions, thanks to President Trump’s support, and then defeated incumbent Democrat Doug Jones, was interviewed by The Alabama Daily News after he attended orientation in D.C. for new senators.

Asked whether he thought the GOP could utilize their potential majority in the Senate to pass legislation as Democrats will control the House and the White House, Tuberville answered he doesn’t care “if you’re a Republican or Democrat” and that he’s been given a mandate to help people.

“Our government wasn’t set up for one group to have all three branches of government – wasn’t set up that way,” Tuberville continued, saying incorrectly: “You know, the House, the Senate, and the Executive.”

Ah, not quite, Coach.  The three are the legislative, the executive and the judicial.

Tuberville also misidentified what America fought against in World War II. When asked about the biggest takeaways from the election, he stated he was concerned that President-elect Biden had promoted a vison that Tuberville claimed “leads more to a socialist type of government.”

“That’s concerning to me, that we’re to the point now where we’ve got almost half the country voting for something that this country wasn’t built on,” Coach Tommy said.  “I tell people, my dad fought 76 years ago in Europe to free Europe of socialism.”

Ah, not quite, Coach.  Hitler be a fascist, not socialist, and the U.S.S.R., or Union of Soviet Socialist Republics, was our ally.

Tuberville also asserted that he plans to use his new Senate office to fundraise for the two Republican senators from Georgia facing crucial runoff elections.

Ah, not quite, Coach.  Political fundraising out of a federal office building, and using official federal resources for campaign purposes, is verboten, err, forbidden by Senate ethics rules.

--Hurricane Iota reached Cat 5 status before slamming northeastern Nicaragua on Monday evening as a Cat 4, further devastating a region just starting to pick up the pieces from Hurricane Eta two weeks earlier.  At last count, 40+ were dead in Nicaragua, Honduras and Colombia.

Iota is the fiercest November storm in the region since a 1932 Cuba hurricane that packed 175-mph winds.

--Congratulations to SpaceX and NASA for successfully launching four astronauts (three from NASA, one from JAXA, the Japanese space agency) to the International Space Station in a capsule built by SpaceX.

This was the first operational flight of the Crew Dragon spacecraft built and operated by SpaceX, the rocket company started by Elon Musk.  Back in May, a Crew Dragon took two astronauts to the space station, but that was a test flight to shake out remaining glitches in the systems.  The capsule successfully docked with the ISS about 24 hours later, the four crew members to spend six months there.

Phil McAlister, director of commercial spaceflight development at NASA, said, “For the first time in history, there is a commercial capability from a private sector entity to safely and reliably transport people to space.”

--I was watching NBC News local as they were unveiling the Rockefeller Center Christmas Tree, the workers unfolding the branches after it had been hauled to its famous spot from Oneonta, N.Y., and I thought, ‘Good lord, that is a hideous tree.’

Scrawny, scraggly.

And I wasn’t alone.  Why this tree was picked for this special honor I’ll never know.

So I read with amusement this bit from Travis M. Andrews of the Washington Post:

“It seems inevitable, for a year in which so little has gone well, that something would be awry with the Rockefeller Center Christmas tree – an annual source of holiday joy. If 2020 were a movie, we’d complain that the screenwriters are getting lazy. This plot point is a little too on-Rudolph’s-nose.

“And yet, here we are.  On Saturday…as a crane lowered it into place, the Norway spruce looked a little worse for wear.  The bottom limbs appeared to be bare, and its needles hung limply, as if the tree had just climbed out of the shower. Meanwhile, it leaned to the side, as if unsteady on its trunk.

“This tree now sits in the same place as the first one in 1931, a 20-foot balsam fir that workers at the center – which was then under construction – pooled their money to purchase as a display of optimism during the Great Depression. The same place where, in 1932, an iconic photograph captured 11 workers eating lunch on a suspended girder, their legs dangling hundreds of feet over the streets of New York City.

“Much as that photograph became emblematic of one period of American life, for many, this new tree serves as a symbol of today’s.

“ ‘In true 2020 form, the Rockefeller Center Christmas tree looks like it tried to cut its own hair,’ tweeted pianist Chris Ryan….

“ ‘Even the Rockefeller Center Christmas Tree is tired of 2020,’ tweeted political scientist Ian Bremmer….

“It couldn’t help but remind many others of another down-on-his-luck fellow with a sad-looking Christmas tree: Charlie Brown.”

Ah yes, after Charlie Brown walks away glumly, thinking he had killed his little tree, Linus moves in and says:

“I never thought it was such a bad little tree,” as he puts it back up.  “It’s not bad at all, really.  Maybe it just needs a little love.”

Well, this tree needs a little engineering work, actually; like lots of filler branches.

But at least we discovered the little owl, “Rockefeller,” hidden in the mess, none the worse for wear, and for this we are all grateful.

---

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

God bless America.

---

Gold $1870
Oil $42.17

Returns for the week 11/16-11/20

Dow Jones  -0.7%  [29263]
S&P 500  -0.8%  [3557]
S&P MidCap  +1.6%
Russell 2000  +2.4%
Nasdaq  +0.2%  [11854]

Returns for the period 1/1/20-11/20/20

Dow Jones  +2.5%
S&P 500  +10.1%
S&P MidCap  +4.1%
Russell 2000  +7.0%
Nasdaq  +32.1%

Bulls 59.6
Bears
18.2

Hang in there.  Mask up…wash your hands.

And HAPPY THANKSGIVING!!! …really….

Brian Trumbore