Week in Review

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Week in Review

06/06/2020

For the week 6/1-6/5

[Posted 10:00 PM ET, Friday]

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Edition 1,103

Special thanks to Bob S. for his support.

A Nation in Turmoil...

I was outraged and appalled Monday night watching the scene at the White House, Lafayette Square, and then St. John’s Episcopal Church as President Trump and/or Attorney General William Barr had a crowd of peaceful protesters cleared with violent force so the president could walk across the street for a photo op.  It was an incredibly jarring moment for the nation. It was also the maddest I’ve been in a long time.  I was enraged, as my father and brother know, having called them right after.  We saw Il Duce in full colors.

But Donald Trump is a very, very small man, and as I’ve told you for over a year, “the generals are pissed.”  They are more than that today and, boy, they are speaking out.

And yet there was the president this morning, taking a victory lap on the economy and a shockingly positive jobs report, but suggesting that George Floyd was “looking down” from heaven and marveling at the numbers, calling it “a great day” for Floyd.

“Hopefully, George is looking down right now and saying this is a great thing happening for our country.  A great day for him, a great day for everybody… This is a great day in terms of equality.”

Disgraceful.

But I’m actually optimistic that, yes, we have reached a tipping point in our nation’s history in terms of race relations.  It won’t be easy by any stretch to get the needed legislation on police reforms, for one, but I do believe we will see real progress in short order.  [We also need convictions in Minneapolis and elsewhere.]

Here in Summit, New Jersey, a very wealthy community for the most part, an 18-year-old student organized a protest rally and 1,500 showed up.  That kind of thing just doesn’t happen here.  Neighboring New Providence had hundreds for a march organized by its young people.

That’s the difference between yesterday…and today.

We are all shaped by our experiences, some shared.  In my case, our family moved from Plainfield, New Jersey (two years later Plainfield had awful riots) to Summit as I was entering second grade in 1965.  My elementary school had a fair number of black children and I was friends with three of them, Darren D., Kenny H., and Mike C. Darren, Kenny and I often played hoops at lunch time and Mike was always on the field, playing soccer.  [Tracy Marrow, aka “Ice-T,” was also a Brayton School classmate but I can’t say Tracy and I were really friends, though we got along fine.]

I grew up being comfortable around kids from another race.  When I got to Wake Forest, I can in all honesty say I played a leading role in bringing in the first black to our fraternity, Stan, who ended up being our president, lead singer in our super band, and one of the more popular kids on campus.

I’ve bored you enough with my friendship with Mary and her son, Mubby, in Newark.  Hell, they threw a big party for me one time with all their relatives, and I was honored at a few of Mary’s gospel concerts, the only white in the audience.  [Boy, I got some strange looks.]

After Mubby’s sudden death a number of years ago, however, Mary and I kind of drifted apart and I have to do a better job of staying in touch.

Mike C. is a lifelong fireman in Summit and when I do see him, if it’s more than yelling at him from the car, I give him a hug.  A few years ago we had a minor fire in my building, I evacuate, and there is Mike with his fellow firefighters.  “Cookie!”

I’ve tried to do what small things I could over the years.  We all need to make an effort.

I have also never said anything good about Rev. Al Sharpton, but that was quite a powerful metaphor he presented in his eulogy for George Floyd on Thursday.  “Get your knee off our necks.”

It is indeed a seismic moment, but now it’s time for the politicians to come together and enact the needed reforms.  We have to keep the heat on them.

It’s been an embarrassing, depressing time for our nation and our enemies are laughing at us.  We come off as amazing hypocrites.  This has to change.

Which brings me back to President Trump….

Former Defense Secretary James Mattis, who resigned in December 2018 in protest of President Trump’s Syria policy, in an opinion piece in The Atlantic.

Titled “In Union There Is Strength” …General Mattis:

I have watched this week’s unfolding events, angry and appalled.  The words “Equal Justice Under Law” are carved in the pediment of the United States Supreme Court.  This is precisely what protesters are rightly demanding. It is a wholesome and unifying demand – one that all of us should be able to get behind.  We must not be distracted by a small number of lawbreakers.  The protests are defined by tens of thousands of people of conscience who are insisting that we live up to our values – our values as people and our values as a nation.

When I joined the military, some 50 years ago, I swore an oath to support and defend the Constitution. Never did I dream that troops taking that same oath would be ordered under any circumstance to violate the Constitutional rights of their fellow citizens – much less to provide a bizarre photo op for the elected commander-in-chief, with military leadership standing alongside.

We must reject any thinking of our cities as a “battlespace” that our uniformed military is called upon to “dominate.”  At home, we should use our military only when requested to do so, on very rare occasions, by state governors.  Militarizing our response, as we witnessed in Washington, D.C., sets up a conflict – a false conflict – between the military and civilian society. It erodes the moral ground that ensures a trusted bond between men and women in uniform and the society they are sworn to protect, and of which they themselves are a part.  Keeping public order rests with civilian state and local leaders who best understand their communities and are answerable to them.

James Madison wrote in Federalist 14 that “America united with a handful of troops, or without a single soldier, exhibits a more forbidding posture to foreign ambition than America disunited, with a hundred thousand veterans ready for combat.”  We do not need to militarize our response to protests.  We need to unite around a common purpose.  And it starts by guaranteeing that all of us are equal before the law.

Instructions given by the military departments to our troops before the Normandy invasion reminded soldiers that “The Nazi slogan for destroying us…was ‘Divide and Conquer.’  Our American answer is ‘In Union there is Strength.’”  We must summon that unity to surmount this crisis – confident that we are better than our politics.

Donald Trump is the first president in my lifetime who does not try to unite the American people – does not even pretend to try.  Instead he tries to divide us. We are witnessing the consequences of three years of this deliberate effort.  We are witnessing the consequences of three years without mature leadership. We can unite without him, drawing on the strengths inherent in our civil society.  This will not be easy, as the past few days have shown, but we owe it to our fellow citizens; to past generations that bled to defend our promise; and to our children.

We can come through this trying time stronger, and with a renewed sense of purpose and respect for one another.  The pandemic has shown us that it is not only our troops who are willing to offer the ultimate sacrifice for the safety of the community.  Americans in hospitals, grocery stores, post offices, and elsewhere have put their lives on the line in order to serve their fellow citizens and their country.  We know that we are better than the abuse of executive authority that we witnessed in Lafayette Square.  We must reject and hold accountable those in office who would make a mockery of our Constitution.  At the same time, we must remember Lincoln’s “better angels,” and listen to them, as we work to unite.

Only by adopting a new path – which means, in truth, returning to the original path of our founding ideals – will we again be a country admired and respected at home and abroad.

Mattis had previously declined to speak out against Trump, saying he wanted to be silent while his former boss remained in office, making the above all the more notable.

George F. Will / Washington Post

“A small fraction of a large number can be a significant number. So, although the fact that there are a significant number of ninnies among the 329 million people in this country is embarrassing, it is not surprising.  What is puzzling is that specimens such as Defense Secretary Mark T. Esper and Gen. Mark A. Milley, the chairman of the Joint Chiefs of Staff, have reached positions of considerable responsibility in today’s government.

“It might be a fact of today’s political physics that these two have floated upward because they are lighter than air.  That, however, is an insufficient explanation of their eminence.  Neither it is satisfactory to merely note that such people can be expected to be found in high offices when the dispenser of offices, civilian and military, probably would explicitly reject basic civic norms if he knew they existed.

“They will not exist for long if the nation does not recoil against an administration that includes a defense secretary who refers to this Republic as a ‘battlespace.’  And also includes a four-star Army general who reports to the Oval Office in combat fatigues, dressed appropriately for an evening of police and military engagements that involved clearing a public park of peaceful demonstrators, and intimidating protesters elsewhere.  The purpose of the clearing, achieved with flash-bang grenades and chemicals, was to enable the Bible-brandishing commander in chief to stand in front of a church for the purpose of stroking the portion of his political base that is composed of Evangelical Christians who relish rendering their souls unto this particular Caesar.  Unfurl the ‘Mission Accomplished’ banner.

“On Tuesday, Esper’s evolving explanation was that he did not know details about the event his commander was conscripting him into.  Monday night’s Battle of Lafayette Square, which took place in a traditional venue of protests, and operations elsewhere in Washington, were inglorious engagements for the U.S. military, comparable to the events of July 28, 1932.  President Herbert Hoover ordered the Army to disperse the members of the self-named Bonus Expeditionary Force, generally remembered as the Bonus Army or Bonus March, which at one point that sweltering summer numbered approximately 20,000.

“It was made up of World War I veterans drawn to Washington to exhort Congress to pass bonuses for veterans.  They were encamped in a sprawling jumble of tents and shanties on the Anacostia River south of Washington.

“After the House narrowly passed but the Senate overwhelmingly rejected the bonus legislation, many marchers began to leave Washington. Hoover’s soon-to-be-successor, New York Gov. Franklin D. Roosevelt, offered to pay for train tickets home for New York marchers.

“But Hoover was reeling toward paranoia under the pressure of the Depression, the worst economic calamity in U.S. history until the one that has today’s president floundering.  Hoover ordered the dispersal of the remaining marchers.

“Gen. Douglas MacArthur, the Army chief of staff, who had been sniffing what he considered the stench of revolution, suspected there were more communists than real veterans.  (Arthur Herman, in his 2016 biography, ‘Douglas MacArthur: American Warrior,’ writes: ‘No one doubts today that the Bonus March was a spontaneous, unplanned movement born of frustration and – in many cases – desperation.’)  MacArthur had ordered tanks brought from Maryland’s Aberdeen Proving Ground and had alerted mounted cavalry under the command of Col George S. Patton.

“When MacArthur decided to witness the operation, one member of his staff warned him, unsuccessfully, that this would be ‘highly inappropriate.’  So spoke Major Dwight D. Eisenhower.

“MacArthur changed from his summer suit into, Herman writes, a uniform that his Filipino valet fetched, the one that MacArthur’s ‘mother usually picked out for formal occasions and dinners, and decorated with every ribbon and medal, including his marksmanship badges,’ with ‘breeches and gleaming riding boots and spurs.’  Herman says, ‘Mac put it on without thinking twice.’

“The cavalry came down Pennsylvania Avenue with drawn sabers, the infantry threw tear-gas grenades, D.C. police pitched in, and the mission was accomplished.  Sometimes it does seem that history is not one damn thing after another, it is the same damn thing over and over.

“Monday’s military and police engagements in downtown Washington were in the service of the president’s promise to ‘dominate’ protesters. It is perhaps a mistake to be angry at Esper or Milley, or, for that matter, at the officers who ordered military helicopters to hover menacingly at rooftop level to intimidate protesters exercising a First Amendment right in proximity to monuments commemorating those who founded and preserved this Republic.  The military officers involved, like their civilian leaders, have all been promoted to the level of their incompetence.”

Thursday, in one of the strongest rebukes of President Trump from any Republican in Congress, Sen. Lisa Murkowski (Ala.) told reporters she supports former Defense Secretary Mattis, describing his comments as “true, honest, necessary and overdue.”

“Perhaps we’re getting to the point where we can be more honest with the concerns that we might hold internally, and have the courage of our own convictions to speak up,” Murkowski told reporters.

David Ignatius / Washington Post

“The military establishment’s anger at President Trump’s politicization of the armed forces has been building for three years.  It finally ripped open in the aftermath of Monday’s appalling presidential photo op at St. John’s Episcopal Church.

“The break was a decisive moment in the Trump presidency.  But such inflection points are mysterious.  Why does a bridge that has carried a million vehicles suddenly collapse when one more heavy load rumbles across?  It’s not a linear process but a sudden discontinuity.  Mathematicians call it ‘catastrophe theory.’

“The catastrophe Monday was that Trump was advocating what military officers dread most.  He was preparing to mobilize the armed forces to suppress protests by U.S. citizens against racial injustice and police brutality.  For military officers who have sworn an oath to defend the Constitution, this was overload. The structure cracked.

“The most dramatic break came from retired Gen. Jim Mattis.  For the 18 months since his resignation as defense secretary in December 2018, Mattis had been asserting a ‘duty of silence’ as a former military commander not to directly criticize the president.  Many had pressed Mattis to speak out, but he had been adamant.

“The bridge of silence toppled Wednesday, when Mattis released a statement expressing the rage he has long felt as he watched Trump demean the military and its professionalism.  Mattis wrote for the history books: ‘Donald Trump is the first president in my lifetime who does not try to unite the American people – does not even pretend to try.  Instead, he tries to divide us.  We are witnessing the consequences of three years of this deliberate effort.’

“The stage for Mattis’ excoriation was set by several prior events that are crucial in understanding Monday’s inflection point.  The first was an opinion piece published in the Atlantic on Tuesday afternoon by retired Adm. Mike Mullen, former chairman of the joint chiefs.  Mullen, like Mattis, had been reluctant to use his military credentials to challenge Trump.

“But Mullen had reached his choke point.  His piece, titled ‘I Cannot Remain Silent,’ challenged Trump’s consideration of using active-duty troops to put down the protesters: ‘I am deeply worried that as they execute their orders, the members of our military will be co-opted for political purposes.’  Mullen also condemned ‘police brutality and sustained injustices against the African American community.’

“Mullen had put down a marker.  Many former colleagues of Mattis wondered why he had not already made a statement like Mullen’s.  When Mattis’ blistering message eventually came, it was worth the wait.

“This drama has a final, largely invisible, chapter that involves Gen. Mark A. Milley, chairman of the Joint Chiefs of Staff, and Mark T. Esper, the defense secretary.  They accompanied Trump on that walk across Lafayette Square, Milley in uniform.  It was a decision they would both deeply regret.”

Editorial / Wall Street Journal

“Former Defense Secretary Jim Mattis’ denunciation of President Trump on Wednesday isn’t surprising, but it still looks like an important political moment.  Mr. Trump’s polarizing and hyper-personal governance is catching up with him, as we and so many others warned….

“(Mattis’) real motivation here is to tell the public that Mr. Trump lacks the character to be President and should be defeated in November….

“(Mattis’ opinion piece) will resonate with many voters because it comes from someone who is no left-winger and has worked closely with the President.  The question is whether this will begin a cascade of similar declarations from other former advisers.  John Bolton, a former national security adviser, has written a memoir that will not be admiring.

“John Kelly, Mr. Trump’s second chief of staff, defended Mr. Mattis from the President’s claim this week that he had fired the defense secretary.  ‘The President has clearly forgotten how it actually happened,’ said Mr. Kelly, another former general whom Mr. Trump disparaged after he left the White House.  Other generals joined the criticism Thursday, and not all of them are Democratic partisans like John Allen, who invoked some apocalyptic nonsense about the end of democracy.

“Every President has breakups with advisers, but Mr. Trump has gone through them like an assembly line.  His demand for personal loyalty and his thin skin clash with people who care about larger causes and have strong views.  Mr. Trump’s habit of blaming others for policy decisions or events that go wrong also builds resentment.  This was bound to boomerang as he ran for re-election, and so it is.”

Episcopal Diocese of Washington Bishop Mariann Edgar Budde was furious with President Trump for standing in front of St. John’s church holding a Bible after protesters were cleared from the area by police with tear gas.

“Let me be clear: The president just used a Bible, the most sacred text of the Judeo-Christian tradition, and one of the churches of my diocese without permission as a backdrop for a message antithetical to the teachings of Jesus and everything that our churches stand for.

“And to do so…he sanctioned the use of tear gas by police officers in riot gear to clear the church yard. I am outraged,” Budde said on CNN.

“The president did not pray when he came to St. John’s, nor…did he acknowledge the agony of our country right now, and in particular, the people of color in our nation who wonder if anyone in public power will ever acknowledge their sacred work, and who are rightfully demanding an end to 400 years of systemic racism and white supremacy in our country,” Budde said.

“I just can’t believe what my eyes have seen tonight,” she added.

Later, Budde released a statement on social media.

“We are followers of Jesus.  In no way do we support the President’s incendiary response to a wounded, grieving nation.  We stand with those seeking justice for the death of George Floyd through the sacred act of peaceful protest.”

Former President George W. Bush:

“This tragedy – in a long series of similar tragedies – raises a long overdue question: How do we end systemic racism in our society?

“It is time for America to examine our tragic failures.”

Bush did not mention Donald Trump by name in his statement.

But he made a point of insisting on the need “to listen to the voices of so many who are hurting and grieving.”

“Those who set out to silence those voices do not understand the meaning of America – or how it becomes a better place,” he says.

“The heroes of America – from Frederick Douglass to Harriet Tubman, to Abraham Lincoln, to Martin Luther King Jr. – are heroes of unity.”

The aforementioned John Kelly, former Trump chief of staff and retired Marine Corps general, was asked by former White House communication director Anthony Scaramucci in a live-streamed event today whether he agreed with James Mattis’ criticism of the president.  Kelly said, “I agree.”

“There is a concern, I think an awful big concern, that the partisanship has gotten out of hand, the tribal thing has gotten out of hand,” Kelly said.

“I think we need to look harder at who we elect.  I think we should look at people that are running for office and put them the filter: What is their character like?  What are their ethics?”

George F. Will / Washington Post

“This unraveling presidency began with the Crybaby-in-Chief banging his spoon on his highchair tray to protest a photograph – a photograph – showing that his inauguration crowd the day before had been smaller than the one four years previous.  Since then, this weak person’s idea of a strong person, this chest-pounding advertisement of his own gnawing insecurities, this low-rent Lear raging on his Twitter-heath has proven that the phrase malignant buffoon is not an oxymoron.

“Presidents, exploiting modern communications technologies and abetted today by journalists preening as the ‘resistance’ – like members of the French Resistance 1940-1944, minus the bravery – can set the tone of American society, which is regrettably soft wax on which presidents leave their marks.  The president’s provocations – his coarsening of public discourse that lowers the threshold for acting out by people as mentally crippled as he – do not excuse the violent few.  They must be punished.  He must be removed.

“Social causation is difficult to demonstrate, particularly between one person’s words and other persons’ deeds.  However: The person voters hired in 2016 to ‘take care that the laws be faithfully executed’ stood on July 28, 2017, in front of uniformed police and urged them ‘please don’t be too nice’ when handling suspected offenders.  His hope was fulfilled for 8 minutes and 46 seconds on Minneapolis pavement.

“What Daniel Patrick Moynihan termed ‘defining deviancy down’ now defines American politics.  In 2016, voters were presented an unprecedentedly unpalatable choice: Never had both major parties offered nominees with higher disapproval than approval numbers.  Voters chose what they wagered would be the lesser blight.  Now, however, they have watched him govern for 40 months and more than 40 percent – slightly less than the percentage that voted for him – approve of his sordid conduct.

“Presidents seeking reelection bask in chants of ‘Four more years!’  This year, however, most Americans – perhaps because they are, as the president predicted, weary from all the winning – might flinch: Four more years of this? The taste of ashes, metaphorical and now literal, dampens enthusiasm.

“The nation’s downward spiral into acrimony and sporadic anarchy has had many causes much larger than the small man who is the great exacerbator of them.  Most of the causes predate his presidency, and most will survive its January terminus.  The measures necessary for restoration of national equilibrium are many and will be protracted far beyond his removal.  One such measure must be the removal of those in Congress who, unlike the sycophantic mediocrities who cosset him in the White House, will not disappear ‘magically,’ as Eric Trump said the coronavirus would.  Voters must dispatch his congressional enablers, especially the senators who still gambol around his ankles with a canine hunger for petting….

“A political party’s primary function is to bestow its imprimatur on candidates, thereby proclaiming: This is who we are. In 2016, the Republican Party gave its principal nomination to a vulgarian and then toiled to elect him.  And to stock Congress with invertebrates whose unswerving abjectness has enabled his institutional vandalism, who have voiced no serious objections to his Niagara of lies, and whom T.S. Eliot anticipated:

We are the hollow men…

Our dried voices, when

We whisper together

Are quiet and meaningless

As wind in dry grass

or rats’ feet over broken glass…

“Those who think our unhinged president’s recent mania about a murder two decades ago that never happened represents his moral nadir have missed the lesson of his life: There is no such thing as rock bottom.  So, assume that the worst is yet to come.  Which implicates national security: Abroad, anti-Americanism sleeps lightly when it sleeps at all, and it is wide-awake as decent people judge our nation’s health by the character of those to whom power is entrusted.  Watching, too, are indecent people in Beijing and Moscow.”

Covid-19 Death Tolls [as I go to post]

Talk about a story that is getting lost in the other news of the day.  The World set another record the last 24 hours in new cases…130,000.  Yes, it’s still out there, friends.

World… 397,446
USA… 111,390
UK… 40,261
Brazil… 35,047
Italy…33,774
France… 29,111
Spain… 27,134
Mexico… 12,545

[Source: worldometers.info]

Covid Bytes

--In 2018, 36,650 people died in the United States in auto accidents nationwide, according to the NHTSA.  As the coronavirus was getting started, I had people writing me saying ‘more people die from auto accidents than will ever die from this…this little thing.’

Well, in just about three months, Covid-19 has killed three times as many Americans.

--But in the New York-New Jersey metro area, there has been amazing progress.  Wednesday, Gotham reported no new confirmed deaths from Covid for the first time since March 12.  My town of Summit has only had about seven new cases reported in two weeks.

But New Jersey also now has about 12,050 deaths.  The state lost around 12,400 in World War II.

--It is disturbing that the coronavirus has been spiking in parts of the Southern Hemisphere as they head into winter…Brazil, Peru, Chile, South Africa…

No one knows for sure if we’ll see a second wave in the U.S., Canada, and Europe, for example, come the fall, but you can’t ignore what is going on.

--Indian Prime Minister Narendra Modi thought his nation had a handle on Covid-19, but the numbers have been spiking.

In an open letter marking one year into his second term, Modi on Saturday urged people to follow lockdown rules to stop the spread as there was a “long battle” ahead.  “Our country is besieged with problems amidst a vast population and limited resources,” adding that laborers and migrant workers had “undergone tremendous suffering” due to restrictions.

Officials are nervous about the pandemic spreading through villages as millions of jobless migrant workers return home from cities.  Picture the partially restored train services and overcrowding and chaos.

Maintaining social distancing and cleanliness is virtually impossible.

--According to a Washington Post/ABC News poll, about 7 in 10 Americans say they would get a vaccine to protect against the coronavirus if immunizations were free and available to everyone.  Hispanics, at 78%, are most interested.

--But now we wait to see what impact the mass protests across America will have.  We should learn a lot over the coming 1-2 weeks.

Trump World

--Karl Rove / Wall Street Journal

“Listening to the political dialogue this past week, you’d think the U.S. consists of two rival tribes.

“One America is focused on the death of an unarmed black man, George Floyd, at the hands of a white Minneapolis cop while three of his fellow officers stood by.  This America knows Mr. Floyd’s death is the latest, lethal example of systemic injustice.

“The other America is focused on the mindless violence in its cities as stores are looted and vandalized, shopkeepers and bystanders beaten and police assaulted and even killed.  This America knows lives are being destroyed by purposeless brutality.

“But it’s worth remembering there is a third tribe, the largest of them all.

“These are Americans who believe that Floyd’s death was a terrible wrong and that violence isn’t justified as a response; that it sullies Floyd’s memory and subverts the cause of those protesting peacefully against injustice.

“Polls show this third camp represents a clear majority.  A Reuters/Ipsos survey released Tuesday found 73% support ‘the peaceful protests and demonstrations that have taken place,’ while 79% believe looting and vandalism ‘undermine the original protest’s case for justice.’

“Similarly, a June 2 Monmouth poll found 78% felt ‘the anger that led to these protests’ was fully or partly justified.  Americans sympathize, but they don’t support burning businesses and churches.

“These numbers suggest that the American people want to hear from their leaders a call to unity to confront the injustice that caused Floyd’s death and reject the violence threatening lives and property in U.S. cities, often in communities of color that have already suffered disproportionately….

“The candidate who understands what most Americans desperately want to hear – words that unite rather than divide, and righteous anger at Floyd’s death as well as the spreading violence – will gain the advantage. Transcending partisan politics is the best way to succeed in politics right now.”

--Attorney General William Barr said on Thursday that foreign interests and “extremist agitators” tied to the Antifa movement have tried to exploit nationwide protests over the killing of George Floyd.  But while Barr and President Trump have focused blame on Antifa, federal prosecutors in Las Vegas on Wednesday charged three members of the far-right “Boogaloo” movement with planning to cause violence and destruction during protests.

--President Trump was setting the stage for Monday’s fireworks at Lafayette Square when earlier in the day, he had a call with governors, calling them “weak” and telling them they need to use force to “dominate” the streets amid the riots.

Democratic Michigan Gov. Gretchen Whitmer said: “The president repeatedly and viciously attacked governors, who are doing everything they can to keep the peace while fighting a once-in-a-generation global pandemic.  The president’s dangerous comments should be gravely concerning to all Americans, because they send a clear signal that this administration is determined to sow the seeds of hatred and division.”

Republican Gov. Charlie Baker of Massachusetts said during a news conference: “I heard what the president said today about ‘dominating’ and fighting. I know I should be surprised when I hear incendiary words like this from him, but I’m not.  At so many times during these past several weeks, when the country needed compassion and leadership the most, it was simply nowhere to be found.  Instead, we got bitterness, combativeness and self-interest.”

--The president said on Tuesday that the Republican convention due to be held in North Carolina in August will have to be held in another state because of social distancing restrictions ordered by the state’s Democratic governor.  In a tweet, Trump said Governor Roy Cooper “is still in Shelter-In-Place Mode, and not allowing us to occupy the arena as originally anticipated and promised.”

Well, the convention is still being held in Charlotte.  As I noted weeks ago, you can’t just break all the contracts.  But it’s clear Trump is looking for a place capable of accommodating a big crowd for his acceptance speech.

--President Trump postponed the G7 summit that he wanted to hold in late June (German Chancellor Angela Merkel said she needed to cancel because of the coronavirus) and instead expanded the list of countries invited to include Australia, Russia, South Korea and India.

Addressing reporters on Air Force One, Trump said: “I’m postponing it because I don’t feel that as a G7 it properly represents what’s going on in the world,” calling the current format a “very outdated group of countries.”

Canadian Prime Minister Justin Trudeau said Russia should not be invited.  “Russia’s continued disrespect and flouting of international rules and norms is why it remains outside of the G-7 and will continue to remain out.”

Australia, South Korea and India quickly accepted.

--President Trump is giving the commencement speech at West Point on June 13 and many raised their eyebrows when he insisted on going through with it, which meant bringing so many students back from around the country to one of the hotspots of coronavirus, though the situation has improved markedly from weeks ago.

That said, the Army, per a report from USA TODY, has confirmed 16 cases of coronavirus among West Point cadets who had to return weeks before the speech.

--Trump tweets:

“Probably the only thing Barack Obama & I have in common is that we both had the honor of firing Jim Mattis, the world’s most overrated General.  I asked for his letter of resignation, & felt great about it.  His nickname was ‘Chaos,’ which I didn’t like, & changed to ‘Mad Dog’…

“…His primary strength was not military, but rather personal public relations. I gave him a new life, things to do, and battles to win, but he seldom ‘brought home the bacon’. I didn’t like his ‘leadership’ style or much else about him, and many others agree.  Glad he is gone!”

[Ed. The above is just one massive lie.]

“John Kelly didn’t know I was going to fire James Mattis, nor did he have any knowledge of my asking for a letter of resignation.  Why would I tell him, he was not…

“…in my inner-circle, was totally exhausted by the job, and in the end just slinked away into obscurity.  They all want to come back for a piece of the limelight”

“It’s ANTIFA and the Radical Left.  Don’t lay the blame on others!”

“Mayor Jacob Frey of Minneapolis will never be mistaken for the late, great General Douglas McArthur [Ed. it’s MacArthur] or great fighter General George Patton.  How come all of these places that defend so poorly are run by Liberal Democrats?  Get tough and fight (and arrest the bad ones). STRENGTH!”

“Great job last night at the White House by the U.S. @SecretService.  They were not only totally professional, but very cool.  I was inside, watched every move, and couldn’t have felt more safe.  They let the ‘protesters’ scream & rant as much as they wanted, but whenever someone would have breached the wall, they would….

“….have been greeted with the most vicious dogs, and most ominous weapons, I have ever seen.  That’s when people would have been really badly hurt, at least.  Many Secret Service agents just waiting for action.  ‘We put the young ones on the front line, sir, they love it, and….

“….good practice.’  As you saw last night, they were very cool & very professional.  Never let it get out of hand.  Thank you! On the bad side, the D.C. Mayor, @MurielBowser, who is always looking for money & help, wouldn’t let the D.C. Police get involved.  ‘Not their job.’  Nice!”

“The Radical Left Democrats new theme is ‘Defund the Police’.  Remember that when you don’t want Crime, especially against you and your family.  This is where Sleepy Joe is being dragged by the socialists. I am the complete opposite, more money for Law Enforcement! #LAWANDORDER”

“D.C. had no problems last night. Many arrests. Great job done by all.  Overwhelming force.  Domination. Likewise, Minneapolis was great (thank you, President Trump!).”

“My Admin has done more for the Black Community than any President since Abraham Lincoln. Passed Opportunity Zones with @SenatorTimScott, guaranteed funding for HBCU’s, School Choice, passed Criminal Justice Reform, lowest Black unemployment, poverty, and crime rates in history…

“…AND THE BEST IS YET TO COME!”

“I am a big fan of Drew Brees. I think he’s truly one of the greatest quarterbacks, but he should not have taken back his original stance on honoring our magnificent American Flag.  OLD GLORY is to be revered, cherished, and flown high…

“…We should be standing up straight and tall, ideally with a salute, or a hand on heart.  There are other things you can protest, but not our Great American Flag – NO KNEELING!”

[Ed. This is a bigtime losing issue for Trump.  Even NFL Commissioner Roger Goodell admitted today he was wrong.  “Black Lives Matter,” he said.]

Wall Street and The Economy

I said last week that today’s jobs report is expected to show the unemployment rate “hit 20% or more.  But this is most likely the bottom.”

So, yes, it was a stunner when instead the report from the Labor Department revealed the economy added 2.5 million jobs last month, instead of a decline of 7.73 million.  Virtually all of the gain appears to be from workers who returned after being furloughed.  The unemployment rate rather than hitting 20% fell from 14.7% to 13.3%.

It’s hard to know what to make of it.  I do not believe we suddenly are going to have a “V-shaped” recovery.  Any bounceback on reopening was bound to be powerful, but once the various payroll protection plans run their course end of the month, and then the CARES ACT in September, where are we?  I don’t know, but it’s clear we pulled forward the easy fruit into May rather than June.  We really won’t get a true picture until the first week in August with the July employment report after we’ve washed through some of the stimulus and the ‘noise’ in the numbers during this unprecedented time.

One thing I’m really focused on is the data out of the TSA and their checkpoint travel numbers, which were 391,882 on Thursday vs. 2,623,947 a year ago, or 15%.  A week earlier, Thurs., May 28, the figures were 321,776 vs. 2,485,770, or 13% of 2019’s level.  Percentagewise, we bottomed April 16 at 4%.  So that’s one barometer worth keeping track of.  You get a sense of where hotel room capacity is at, for example.

Auto sales will be a key indicator of the strength of the recovery and the May numbers weren’t that bad vs. dire expectations.

Needless to say, President Trump took the jobs report and ran with it…straight to the Rose Garden, where he rambled for 45 minutes without taking questions after it was billed as a press conference.

“Today is probably, if you think of it, the greatest comeback in American history.  We’re going to be stronger than we were when we were riding high.”

‘Riding high’ was a 2% economy, you’ll recall.

Wall Street celebrated today and has been for weeks owing to much of the country reopening in a substantive way.

But we still have a 13.3% unemployment rate, including 16.8% in the African-American labor force, 17.6% for Hispanics, both moving up last month, not down, further highlighting the income disparity and inequality in this country.

The Congressional Budget Office said the fallout from the coronavirus pandemic will shrink the size of the U.S. economy by roughly $8 trillion over the next decade, according to new projections released on Monday.  That amounts to a 3 percent decline in U.S. GDP compared to its initial estimate.

Part of the impact from the pandemic will be mitigated by the more than $2 trillion the federal government has already approved in emergency spending for households and businesses.

In other economic news, the ISM May manufacturing PMI came in at 43.1 (50 being the dividing line between growth and contraction) after a 41.5 reading in April, while the ISM non-manufacturing (services) number was 45.4 after April’s 41.8 (which was the first below 50 since Dec. 2009).  Still contraction in both, but it will be interesting to see June’s numbers, especially after the jobs report.

Separately, April construction spending was down 2.9%, while factory orders in the month cratered 13.0%.

U.S. exports and imports both had their largest monthly decreases on record in April amid the coronavirus-related shutdowns around the world.

Imports fell 13.7% in April from March, and exports dropped 20.5%, the largest declines since record-keeping began in 1992.

Because of the above trade data, the Atlanta Fed’s GDPNow barometer for second-quarter growth shows a drop of 53.8%... -53.8%.  But this could change drastically as further data from May and then June comes in.

Meanwhile, the U.S. and China both walked back from severe restrictions on flights to each other, with the U.S. Transportation Department planning to revise an order in the coming days that will allow some Chinese passenger airline flights to continue, after China said it would ease coronavirus restrictions to allow in more foreign carriers on its end, shortly after Washington said it was ready to bar Chinese passenger airlines from flying to the United States by June 16 due to Beijing’s curbs on U.S. carriers.

China is still limiting the number of flights versus pre-pandemic levels, and the U.S. said it will allow Chinese carriers to operate “the same number of scheduled passenger flights as the Chinese government allows ours.”

Europe and Asia

First the economic data. It was PMI week in the eurozone (EA19), courtesy of IHS Markit.

The final EA19 composite index for May was 31.9 vs. April’s sickening 13.6.  Manufacturing was 39.4 vs. April’s 33.4, while the final services figure was 30.5 vs. 12.0.

Germany 36.6 mfg. in May (34.5 in April); 32.6 on services (16.2 in April)
France  40.6 mfg. (vs. 31.5); 31.1 services (vs. 10.2)
Italy 45.4 mfg. (vs. 31.1); 28.9 services (vs. 10.8)
Spain 38.3 mfg. (vs. 30.8); 27.0 services (vs. 7.1)

UK 40.7 mfg. (vs. 32.6); 29.0 services (vs. 13.4)

Chris Williamson / IHS Markit:

“The scale and breadth of the eurozone downturn was highlighted by the PMI data showing all countries enduring another month of sharply falling business activity.  Eurozone GDP is consequently set to fall at an unprecedented rate in the second quarter, accompanied by the largest rise in unemployment seen in the history of the euro area.

“Encouragingly, while rates of decline of both business activity and employment remained shockingly steep for a third successive month in May, the downturn has already eased markedly in all countries surveyed.  Optimism about the outlook has also returned in Italy and, to a lesser degree, France, while pessimism has moderated markedly in all other countries.

“Providing there is no resurgence of infection numbers, the planned lifting of lockdowns will inevitably help boost business activity and sentiment further in coming months.

“However, the outlook is scarred by the prospect of demand remaining weak due to household spending being hit by high levels of unemployment and corporate spending being subdued as companies repair balance sheets.

“Consumer-facing services are likely to continue to take the hardest hit from those Covid-19 containment measures that may need to stay in place, the longest, acting as a particular drag on the overall recovery.

“We therefore remain cautious with respect to the recovery.  Our forecasters expect GDP to slump by almost 9% in 2020 and for a recovery to pre-pandemic levels of output to take several years.”

Eurozone unemployment for April came in at 7.3%, up from 7.1% in March.  [Eurostat]

April retail trade fell 11.7% in the euro area compared with March.  It had declined 11.1% that month.  Year-over-year, the April 2020 figure is down 19.6%. [Eurostat]

Retail sales in the UK cratered 18.3% in May – the second worst result on record after April’s 29.6% decline.  But now Britain is reopening, with non-essential retail set to open its doors, in a limited fashion, on June 15.

Meanwhile, some of us are rather stunned with a huge new dose of stimulus announced by the European Central Bank on Thursday, nearly doubling a de facto money printing program to $1.5 trillion, to ensure a steady flow of cheap credit to eurozone consumers and businesses.  And at the same time the German government of Chancellor Angela Merkel, known as a fortress of fiscal conservatism, announced a package of tax cuts, aid to small business, cash payments to parents and other measures worth $140 billion – a move requiring substantial borrowing.

A week earlier, the European Commission unveiled a plan to raise $825 billion for pandemic recovery by selling bonds that would be backed by all 27 members of the European Union, a first for the bloc on such a large scale. 

It’s the speed of the response that is startling.  That said, the ECB still forecast that the eurozone economy will slump 9 percent this year.

Turning to Asia…China’s PMIs for May were mixed, though solid improvement in the service sector.  The official government manufacturing PMI was 50.6 vs. 50.8 in April, an example of how slow the reopening has been, while services rose to 53.6 from 53.2.

A sub-index of the manufacturing number for new export orders was a putrid 35.3, the fifth consecutive month of contraction for this metric.

The private Caixin manufacturing figure was 50.7 vs. April’s 49.4. But the non-manufacturing number of 55.0 (vs. April’s 44.4) was the highest since October 2010.

Japan had a manufacturing PMI for May that was just 38.4 vs. 41.9 in April, non-manufacturing came in at a still sickly 26.5 vs. 21.5, pandemic lockdowns hitting demand like everywhere else in the world.

Taiwan had a manufacturing PMI in May of 41.9, while South Korea’s was 41.3.  In the latter, May exports were down 23.7% year-on-year, according to the trade ministry.  The Bank of Korea downgraded its 2020 growth projection to a 0.2% decline as it cut its policy rate to a record-low of 0.50% on Thursday after an emergency 50 basis point cut in mid-March.

Street Bytes

--The powerful rally continued, with the Dow Jones adding 6.8% to 27110, cutting its loss for the year to just 5%, while the S&P 500 rose 4.9%, now down just 1% in 2020.  Through Wednesday, the S&P had had its best 50-day performance in history.

Nasdaq, up 3.4%, is now just three points shy of its record close at 9814 and is up 9% on the year.

The rally continued in Europe, with the French and German benchmark indexes up 10.7% and 10.9%, respectively.

--U.S. Treasury Yields

6-mo. 0.18%  2-yr. 0.21%  10-yr. 0.89%  30-yr. 1.66%

The yield on the 10-year rose 26 basis points today on the jobs report to its highest weekly close since March 13.

In the eurozone bond market, as alluded to above, the ECB scooped up all of Italy’s new debt in April and May but merely managed to keep borrowing costs for the indebted, virus-stricken country from rising, data showed on Tuesday.  But the Italian 10-year is down to 1.41% from 1.86% three weeks earlier, which is the point of all the bond-buying.

The yield on Greece’s 10-year has plummeted to 1.32% from 2.13% four weeks ago.

--Oil prices rose anew, lifted by an agreement between Saudi Arabia and Russia to extend supply cuts through July. OPEC delegates, meeting Wednesday, said that the two countries have agreed to continue historic cuts of 9.7 million barrels a day and to revisit the output curbs every month.

Saudi Arabia and Russia are still completing a deal among a 23-country coalition known as OPE-plus, with a key meeting Monday.  The pact could be jeopardized if alliance members including Iraq and Nigeria are unwilling to make up for their lack of compliance with the recent curbs, the delegates said.

OPEC’s supply cuts, as well as reductions by North American producers in response to ultralow prices, have restored traders’ confidence in the oil market.

Some smaller North American producers are beginning to turn the taps back on.  Texas producer Parsley Energy Inc., for example, plans to bring most of the 26,000 barrels a day it throttled in May back online this month.

But a resumption of drilling will add to a glut that still exists.  While commercial crude-oil inventories declined by 2.1 million barrels last week, the Department of Energy said Wednesday, they still stood 12% higher than the average for this time of year.

Friday, the Baker Hughes rig count showed the number of oil rigs operating in the U.S. dropped this week to the lowest level in nearly 11 years (just 206 rigs vs. 800 a year earlier), with the price of crude closing at $39 on West Texas Intermediate.

--Many of the major automakers no longer report monthly sales, but several who do reported stronger-than-expected May sales in the United States, and the Detroit companies said they will work through their annual summer shutdowns.

The U.S. auto sector has reopened assembly plants and there are signs for optimism.  Toyota Motor Corp. said overall U.S. sales fell about 26% in May, but retail demand rebounded to 86% of levels in May 2019, exceeding the company’s forecasts.  Retail sales almost doubled from April to May.

Hyundai Motor Co. said overall U.S. sales in May fell 13%, but this was far better-than-expected.

General Motors said it will keep building vehicles at most of its U.S. plants “to meet strengthening customer demand,” instead of taking a traditional two-week summer shutdown starting June 29.  Half of Ford Motor Co.’s eight U.S. assembly plants have reduced their shutdowns to one week.  Others are shifting their breaks to later in the year.

--As U.S. air carriers have said they are collectively burning through more than $10 billion in cash a month, parking more than half of their planes and cutting thousands of flights. Southwest Airlines Co. said on Monday it was extending buyout packages and temporary paid leaves to employees in what CEO Gary Kelly said was an effort to “ensure survival.”

Southwest, which has not imposed any layoffs or furloughs in its 49-year history, said its flying capacity would probably be down about 30% in the fall.

“While overstaffing isn’t tied 100% to capacity levels, it would be fair to assume that we are overstaffed in many areas by a similar percentage,” Southwest said in documents seen by Reuters.

Employees with more than 10 years’ experience would receive a year’s pay, health benefits and four years of flight privileges, per the buyout packages.  Pilots would receive about two-thirds of their average salary for five years, or until they reach age 65.

--Delta Air Lines said it will block middle seats on all its aircraft through September, extending the policy for three months to soothe passenger fears about contracting the coronavirus.

The carrier will switch to larger planes or add flights on high-demand routes that approach seating limits, Delta said in a statement Wednesday.

Delta and JetBlue are the only U.S. carriers to guarantee empty middle seats.  Southwest Airlines has pledged to book flights at no more than two-thirds full, while American Airlines is limiting the number of customers on each flight.

United Airlines said it will let passengers change seats to maintain social distancing, when possible.

--Fifteen U.S. airlines were granted final government approval on Wednesday to temporarily halt service to 75 domestic airports as travel demand has been crushed.

The U.S. Transportation Department said all airports would continue to be served by at least one air carrier.

For example, Delta is halting service to places like Aspen, Colorado; Bangor, Maine; and Flint, Michigan.

United is halting service to Chattanooga, Tenn., and Hilton Head and Myrtle Beach, S.C.

--But Thursday, shares in American Airlines soared after the carrier said it plans to utilize 55% of its domestic capacity in July, compared with a year earlier, having reduced capacity by 80% in May.  Plans to fly 4,000+ flights on peak days in July vs. 2,000 in May are still below the peak 6,800 daily flights before Covid-19, but the action in the stock speaks to a potential earlier recovery for the industry than first feared.

The other airlines soared in sympathy, but they sold off Friday afternoon after massive upward moves.  Shares in American, which closed at $11.80 on Wednesday, hit $22.80 Friday before closing at $19.

--For all the late-week optimism, this afternoon United announced it is closing three out of four international bases for flight attendants.  United is closing its Frankfurt, Hong Kong, and Tokyo bases effective Oct. 1, while keeping London.  About 840 flight attendants will be affected but will be able to transfer to U.S. bases for the October flying schedule.  UAL has received about $5 billion in government payroll aid under the CARES Act which bans any forced job cuts before October.

--Canadian business jet maker Bombardier Inc. said today it was cutting 2,500 jobs at its aviation unit and will take a related charge of $40 million this year as the pandemic hits sales. 

--Las Vegas partially reopened some of its casinos on Thursday, but serious questions remain about how willing Americans will be to fly and mingle in large crowds, including dancing in a nightclub.

As Katherine Sayre and Kim Mackrael write in the Wall Street Journal:

“The pandemic hit Nevada’s workforce harder than any other U.S. state and poses a potentially existential threat to Las Vegas’s business model based on bringing people together for gambling, entertainment and conventions.”

Nevada’s unemployment rate in April, at 28.2%, was the highest of any state in the country, and nearly double the national average of 14.7%.

The slow rebirth of the Strip doesn’t immediately include big entertainment, nightclubs, or the conventions so counted on.

Until there is a vaccine, there is limited cause for optimism in the state.

--Facebook Inc. CEO Mark Zuckerberg told staff at a companywide meeting that he won’t change his  mind about a decision to leave up posts shared by President Trump last week that many workers believed violated the company’s policies against violent rhetoric.

At an all-hands meeting via video chat Tuesday, Zuckerberg took questions from employees, many of whom have publicly voiced dismay that the Trump posts, which seemed to threaten that looters would be shot, were still visible on Facebook’s service.

But Zuckerberg told workers that he and the company’s policy team could not justify the posts as clearly inciting violence.

Zuckerberg added that Facebook is exploring whether the company should change the policy.

It was last Friday that President Trump had posted a message with the words “when the looting starts, the shooting starts” in response to protests over the death of George Floyd.

The same posts were shared to Twitter Inc., which then added a warning and filter to the messages.

Zuckerberg initially wrote in a post on the platform: “People can agree or disagree on where we should draw the line, but I hope they understand our overall philosophy is that it is better to have this discussion out in the open, especially when the stakes are so high.

“I disagree strongly with how the President spoke about this, but I believe people should be able to see this for themselves because ultimately accountability for those in positions of power can only happen when their speech is scrutinized out in the open.”

--Amid the protests over the fatal arrest of George Floyd, chief executives of several public companies have been speaking out like never before.

“No organization is immune from the challenges posed by racial bias,” BlackRock CEO Larry Fink wrote on LinkedIn Saturday.  “As a firm committed to racial equality, we must also consider where racial disparity exists in our own organizations and not tolerate our shortcomings.”

Jamie Dimon, chairman and CEO of JPMorgan Chase, and Brian Lamb, global head of diversity and inclusion, told the bank’s employees in a memo that “we are watching, listening and want every single one of you to know we are committed to fighting against racism and discrimination wherever and however it exists… This week’s terrible events in Minneapolis, together with too many others occurring around our country, are tragic and heartbreaking.”

Starbucks CEO Kevin Johnson decried “racial injustices” in a memo to employees.  “As we all deal with our personal feelings and experiences through this, there are important questions in front of us.  How can we help each other heal, and how can we contribute to society in a positive and constructive way on the topic of racism and injustice?”

--Zoom Video Communications Inc. raised its full-year outlook for sales after they more than doubled in the first quarter with the surge in users working remotely during the pandemic.

Zoom reported first-quarter sales of $328.2 million, up 169% from a year earlier, and posted a profit of $27 million, both figures far ahead of expectations.

The coronavirus has raised the company’s profile, but also exposed security and safety shortcomings that nine-year-old Zoom now is rushing to address.

Zoom shares have more than tripled this year and the company said it expects sales to reach between $495 million and $500 million in the current quarter, also topping Street forecasts.

Zoom said it saw a peak number of more than 300 million daily meeting participants in the latest quarter, up from around 10 million at the end of last year before the pandemic hit.

If you were wondering how the company handles the increased usage, Zoom has had to rent additional capacity from third-party cloud vendors such as Amazon.com and Oracle, which weighs on margins.

There have been concerns over the San Jose, Calif.-based Zoom and ties to China, with CEO Eric Yuan, a Chinese-born U.S. citizen under some scrutiny.  Security researchers discovered that Zoom was sending some call data to China, even though the calls were taking place elsewhere. Zoom said that was a mistake.

The Education Department also has asked the University of Texas System for information on any contracts or gifts from Mr. Yuan.  The department is seeking data regarding the school’s dealings with the Chinese laboratory U.S. officials are investigating as a potential source of the pandemic.  The company said Yuan hasn’t given any gifts to the University of Texas.

Historically, Zoom has done a majority of its engineering work in China, but the company said it plans to open engineering centers in the U.S., hiring as many as 500 engineers over the next few years in Phoenix and Pittsburgh.

--Campbell Soup Company reported fiscal third-quarter results that were better than expected, with net sales increasing to $2.24 billion from $1.95 billion in Q3 of fiscal 2019, buoyed by “increased demand for at-home food consumption” amid the stay-at-home mandate implemented due to the Covid-19.

Campbell raised its fiscal 2020 outlook for net sales growth from a previous estimate of a 1% decline to a 1% increase, to 5.5% to 6.5%.

--Dick’s Sporting Goods said e-commerce sales have soared in the first weeks of its current quarter as most of its locations have re-opened after being closed for much of the just-ended fiscal period.

The company said e-commerce sales were up 250% in the first four weeks of the fiscal second quarter, while same-store sales were down 4%.

Same-store sales fell nearly 30% in the fiscal first quarter, ending May 2,with e-commerce sales jumping 110%.  Dick’s closed its stores in mid-March.

Same-store sales had been up 7.9% through March 10, a week before the company shuttered its locations.

--Shares in Tiffany & Co. plunged Tues. after reports surfaced LVMH’s $16 billion deal to buy the jeweler is uncertain as the U.S. economy faces widespread upheaval.

Board members of the French luxury giant arranged to meet Tuesday to discuss the planned acquisition, and what seemed most probable then is that the deal terms would be reworked.  Tiffany shares dropped to about 16% below the original $135 a share purchase price.

Then Friday morning, LVMH backed down from renegotiating the terms.

--U.S. Secretary of State Mike Pompeo on Thursday warned American investors against fraudulent accounting practices at China-based companies and said the Nasdaq’s recent decision to tighten listing rules for such players should be “a model” for all other exchanges around the world.  President Trump issued a memorandum on Thursday calling for recommendations to be issued within 60 days to protect U.S. investors from what he said was China’s failure to allow audits of U.S.-listed Chinese companies.

Nasdaq took action last month and tightened listing rules, in a bid to curb initial public offerings of Chinese companies closely held by insiders and with opaque accounting.

--CNN hit a major ratings milestone: On Wednesday, the network notched its sixth day in a row in the top  spot among the cable news channels for total day and primetime viewers in the advertiser-coveted age demographic of 25 to 54. 

According to Nielsen ratings, from Friday, May 29 to Wednesday, June 3, CNN beat Fox News and MSNBC in the demo in total day ratings.

It’s the first time CNN has topped those viewership groups in 19 years.

--Finally, we all received a boost of positivity and optimism on Saturday afternoon as the Demo-2, Crew Dragon manned mission to the International Space Station blasted off from Cape Canaveral after initially being scrubbed Wednesday because of bad weather.

It was the first manned spaceflight from U.S. soil since 2011 and the first-ever crewed flight for SpaceX, as Elon Musk, with an assist from NASA, opened up space for private business.

So we wish astronauts Douglas Hurley and Robert Behnken a safe journey.  They are due to be up in the ISS for at least a month.

Foreign Affairs

China/Hong Kong/Taiwan: Needless to say, China has had a field day with the protests and turmoil in the United States the past ten days, while at the same time, with China’s economy beginning to rebound, and the nation seemingly having beaten back the coronavirus, President Xi Jinping is focused on Hong Kong, Taiwan, the South China Sea and a border issue with India.  As the Wall Street Journal quoted a Chinese government adviser and professor at Beijing’s Renmin University:

“The top leadership thinks China is relatively strong compared to the U.S. at the moment.  Of course they see this as a strategic window of opportunity.”

Meanwhile, some of the commentary from one of the Chinese Communist Party’s mouthpieces, The Global Times:

“The U.S. is not there for ethnic minorities and poor people. Through the epidemic and the attitude of the ruling elites in the riots, people can see that these groups live in desperation. Because the poor have no way to unite under the U.S. and can easily be divided, their common dissatisfaction has a limited impact on elections, and they have never become the focus of attention of policymakers.

“China’s massive poverty alleviation program is just unthinkable in the U.S.  The frosty attitude of capitalism against the vulnerable groups has been laid bare in the past few months. The poor in the U.S. are experiencing a very bad 2020….

“African Americans and people at the bottom protest once in a while, with isolated cases being the fuse of the eruption.  But it will not change anything, and they will eventually foot the bill for most of the destruction they make.  Before a reasonable solution comes out, this periodic breakout becomes an unavoidable cycle.

“Judging from the superficial comments and statements from U.S. politicians on the protests, the outsiders can easily draw the conclusion that solving problems is not on the minds of the country, and elites are just fearlessly waiting for this wave of demonstrations to die out.”

And, in a separate editorial:

“The protests in the U.S. are like a mirror that reflects the shame and disgrace of U.S. politicians as well as the deep-rooted political dysfunction and chaotic values in the U.S.  The decades-old problems have not been fixed while U.S. politicians did not even make any efforts.  The U.S. political elites of this generation are just lazy while acting pompously and arrogantly.  They are good at blaming others while lacking real political vision. They are consuming accumulated political resources.

“The ongoing chaos in the U.S. will not lead to due reflection, but will bring the practices of verbal assault and buck-passing to a new height.  No matter what happens, the U.S. will always believe its political system is the best.”

Hong Kong Chief Executive Carrie Lam accused foreign governments on Tuesday of “double standards” in their reaction to Beijing’s plans to impose national security laws on the city, pointing to anti-police brutality protests in the United States.

“They are very concerned about their own national security, but on our national security…they look through tinted glasses,” Lam told a weekly news conference.

“In the U.S., we see how the riots were being handled by the local governments, compared to the stance they adopted when almost the same riots happened in Hong Kong last year.”

Thousands held an annual vigil in Hong Kong despite a police ban on the anniversary of China’s bloody 1989 Tiananmen Square democracy crackdown, accusing Beijing of stifling their freedoms too.  Police used pepper spray on the crowd.

It was the first time there had been unrest during the annual Tiananmen vigil in Hong Kong, though there were peaceful demonstrations in the city as well.

Taiwan President Tsai Ing-wen wrote on her Facebook page: “In China, every year has only 364 days; one days is forgotten.  I hope that in every corner of the earth there won’t be any days that are disappeared again.  And I wish Hong Kong well.”

China has never provided a full account of the 1989 massacre.  The death toll given by officials days later was about 300, most of them soldiers, but rights groups and witnesses say thousands of people may have died.

There was no mention of the anniversary in Chinese state media.  But Hu Xijin, editor of the Global Times, tweeted out his own commentary.

“The Tiananmen incident gave Chinese society a political vaccine shot, which has enabled us to be immune to any color revolution.  31 years later, riots emerged and spread in the U.S. They only think of exporting it, but forget to prepare vaccine for themselves.”

Hu did not elaborate.

Meanwhile, British Prime Minister Boris Johnson said China’s actions in Hong Kong risked “badly eroding” the protection of political freedoms enshrined in the Sino-British agreement.

“What we are saying,” Johnson told reporters, “is that we want to hold out our hand, a hand of friendship and support and loyalty, to the people of Hong Kong.”

Writing in the Times of London newspaper, Johnson said, “Hong Kong succeeds because its people are free. If China proceeds (with its proposed national security law), this would be in direct conflict with its obligations under the joint declaration, a legally binding treaty registered with the United Nations.

“Many people in Hong Kong fear that their way of life – which China pledged to uphold – is under threat.  If China proceeds to justify their fears, then Britain could not in good conscience shrug our shoulders and walk away; instead we will honor our obligations and provide an alternative,” Johnson said.

Hong Kong was handed back to China in 1997 after more than 150 years of British rule.  China said its decisions on national security in Hong Kong were its own affair and that Britain’s link to the territory stemmed from “aggressive colonization and unequal treaties.”

“The UK’s irresponsible remarks and accusations…have grossly interfered in China’s internal affairs including Hong Kong affairs,” Chinese Foreign Ministry spokesman Zhao Lijian said.  “We advise the UK side to step back from the brink… the UK said the legislation is authoritarian, but this word is the exact characterization of the UK’s former rule over HK,” the spokesman said.

Johnson repeated Britain’s pledge to give British National Overseas passport-holders in Hong Kong a path to British citizenship, allowing them to settle in the United Kingdom.  There are about 350,000 holders of BNO passports in Hong Kong and another 2.5 million are eligible for them, Johnson said.

Separately, a senior Google security official said on Thursday that state-backed hackers from China have targeted staffers working on the presidential campaign of Joe Biden.  The same official said Iranian hackers had recently targeted email accounts belonging to President Trump’s campaign staff.  The announcement by the head of Google’s Threat Analysis Group is the latest indication of the digital spying routinely aimed at top politicians.  But the Google official said there was “no sign of compromise” of either campaign.

Lastly, the tensions between China and India have fueled an arms and troops buildup on both sides of their disputed border, though there is no official confirmation on the numbers for either.  There have been reports the People’s Liberation Army has been stepping up advanced testing and training at high altitude.

There have been tensions for the past month, with troops from the two nations involved in fist fights.

North Korea: South Korea said Thursday it planned to push new laws to ban activists from flying anti-Pyongyang leaflets over the border after North Korea threatened to end an inter-Korean military agreement reached in 2018 to reduce tensions if Seoul fails to prevent the protests.

Sending balloons across the border has been a common activist tactic for years, but North Korea considers it an attack on its government.  Defectors and other activists in recent weeks have used balloons to fly leaflets criticizing the North’s authoritarian leader Kim Jong Un over his nuclear ambitions and dismal human rights record.

Earlier in the day, Kim’s sister threatened to end the military agreement and said the North could permanently shut a liaison office and an inter-Korean factory park that have been major symbols of reconciliation.

In her statement released through state media, Kim Yo Jong called the defectors involved in the balloon launches “human scum” and “mongrel dogs” who betrayed their homeland and said it was “time to bring their owners to account,” referring to the government in Seoul.

Syria: Russia flew a batch of advanced MiG-29 fighter jets in Syria, Moscow’s embassy in Damascus said, with Syrian pilots already using the planes to conduct missions within the country’s airspace. President Vladimir Putin is seeking to obtain more facilities and maritime access in Syria, in addition to the two military bases it already has.  The latest batch of planes was for the Syrian military.

Russia: Russia’s space agency criticized President Trump’s “hysteria” about the first spaceflight of NASA astronauts from U.S. soil in nine years, but also said on Sunday it was pleased there was now another way to travel into space. 

Trump said the United States had regained its place as the world’s leader in space, that U.S. astronauts would soon land on Mars, and that Washington would soon have “the greatest weapons ever imagined in history.”

NASA has had to rely on Roscosmos, Russia’s space agency, to get to the ISS since its final shuttle flight in 2011.  The U.S. success will potentially deprive Roscosmos, which has suffered corruption scandals and a number of malfunctions, of the lucrative fees it charged to ferry U.S. astronauts.

“The hysteria raised after the successful launch of the Crew Dragon spacecraft is hard to understand,” Vladimir Ustimenko, spokesman for Roscosmos, wrote on Twitter after citing Trump’s statement.  “What has happened should have happened long ago.  Now it’s not only the Russians flying to the ISS, but also the Americans.  Well that’s wonderful!”

Moscow has said previously that it is also deeply worried about what it fears are U.S. plans to deploy weapons in space.  Russia would not be sitting idly by, Ustimenko said.  “We are not going to rest on our laurels either.  We will test two new rockets this year, and next year we will resume our lunar program.  It will be interesting.”

Random Musings

--Presidential tracking polls….

Gallup: 49% approval of President Trump’s job performance, 48% disapproval; 92% Republicans, 46% Democrats (May 1-13).  [I’m almost glad we haven’t seen a new Gallup update yet because there has certainly been a lot to process since the last survey. It will be more meaningful when it does come out.]
Rasmussen: 48% approval, 51% disapproval (June 5)

A new Monmouth University national poll gives President Trump a 42% approval rating, 54% disapprove, down from a 46-48 split in March.  February, pre-Covid, it was 44-50.

[The overall job rating for Congress stands at 22% approve and 69% disapprove; a notable drop from 32-55 in both April and May, and marks a return to its pre-Covid February standing, 20-69.]

A Reuters/Ipsos national poll of registered voters gives Joe Biden a 10-point lead over Donald Trump, 47-37, with the president receiving just a 39% approval rating.

Twice as many independent voters said they disapproved of Trump’s response to the unrest.  Only 67% of Republicans said they approved.

Overall, more than 55% of Americans said they disapproved of Trump’s handling of the protests, while just one-third said they approved.  And this survey was released Tuesday, so it did not reflect fully the impact of Monday night’s fiasco at the White House.

--A Washington Post/ABC News national poll showed Joe Biden leading Trump 53 to 43 percent among registered voters.  Two months previously, Biden held just a 49-47 lead.

But, among those who are both registered and certain to vote, Biden’s lead is just 51-46.

President Trump’s job approval rating is 45%, 53% disapproval.

Trump’s rating specifically for handling the pandemic is a nearly identical 46-53%, with approval down 5 percentage points and disapproval up 8 in the past two months.

--According to RealClearPolitics, Joe Biden leads Trump in five of six key battleground states – Florida, Michigan, Pennsylvania, Wisconsin and Arizona.  Trump has a slight edge in North Carolina.

--In a Fox News poll of registered voters in Wisconsin, Joe Biden has a 49-40 lead over President Trump, up from a 5-point advantage in January.  11 percent are uncommitted.

A big reason Trump trails Biden is lack of party support: 85 percent of Republicans back him, while 93 percent of Democrats support Biden.  Eight percent of Republicans defect to Biden.

Biden leads in Wisconsin with strong backing among women (+20), suburban voters (+14), and independents (+8).

Trump won Wisconsin in 2016 by a 47.2-46.5 margin.

--Donald Trump defeated Hillary Clinton by nine points in Texas in 2016, 52-43 percent, but a Quinnipiac University poll of voters in the Lone Star State released Wednesday has Trump at 44% and Biden 43%.  Independents go for Biden by a 45-36 margin.

But only 38% view Biden favorably, while 45% view him unfavorably.  42% view Trump favorably, 50% unfavorably.

--Biden won seven primaries Tuesday – Maryland, Indiana, Rhode Island, New Mexico, Montana, South Dakota and Washington, D.C., putting the former vice president within about  100 delegates of securing the Democratic nomination.

--According to the above-referenced Monmouth University national poll, the number of people who consider racial and ethnic discrimination to be a big problem has increased from about half in 2015 to nearly 3 in 4 now.

A majority of Americans (57%) say that police officers facing a difficult or dangerous situation are more likely to use excessive force if the culprit is black, compared to one-third (33%) who say the police are just as likely to use excessive force against black and white culprits in the same type of situation.

49% of white Americans say that police are more likely to use excessive force against a black culprit, which is nearly double the number (25%) who said the same in 2016.  A significant change in attitudes.

--Iowa conservative congressman Steve King was voted out of the House in Tuesday’s primary*, losing to state Sen. Randy Feenstra.

King’s 17-year Congressional career has been defined by his strong anti-immigration stance.  He was shunned by many on both sides of the aisle over the course of last year for his “Western civilization” comments, with the White House stripping him of committee assignments and President Trump barring him from a trip on Air Force One.

Feenstra will face off against Democrat Theresa Greenfield, a Des Moines real estate developer, in the general election.

*Iowa held its presidential caucus in February, Joe Biden finishing fourth.

--San Antonio Spurs head coach Gregg Popovich is a man who isn’t afraid to speak his mind.  Popovich spoke to The Nation’s Dave Zirin on Sunday, and he touched on several topics that are currently in the news, including racism and police violence in response to the death of George Floyd.

“The thing that strikes me is that we all see this police violence and racism and we’ve seen it all before but nothing changes. That’s why these protests have been so explosive. But without leadership and an understanding of what the problem is, there will never be change.   And White Americans have avoided reckoning with this problem forever because it’s been our privilege to be able to avoid it.  That also has to change.”

Then he moved on to Donald Trump.

“It’s unbelievable.  If Trump had a brain, even if it was 99 percent cynical, he would come out and say something to unify people.  But he doesn’t care about bringing people together.  Even now.  That’s how deranged he is.  It’s all about him.  It’s all about what benefits him personally.  It’s never about the greater good.  And that’s all he’s ever been.”

Popovich has spoken about Trump before, but given everything that’s happened over the past week, this time he really went in.

“It’s so clear what needs to be done.  We need a president to come out and say simply that ‘Black Lives Matter.’  Just say those three words.  But he won’t and he can’t.  He can’t because it’s more important to him to mollify the small group of followers who validate his insanity.  But it’s more than just Trump.  The system has to change.  I’ll do whatever I can do to help because that’s what leaders do.  But he can’t do anything to put us on a positive path because he’s not a leader.

“It’s like what Lindsay Graham and Ted Cruz used to say when they had the courage to say it: He’s unfit.  But they have chosen instead to be invisible and obsequious in the face of this carnage.  In the end what we have is a fool in place of a president, while the person who really runs the country, Senator Mitch McConnell, destroys the United States for generations to come.  McConnell has destroyed and degraded our judicial system.  He has tried to destroy health care.  He’s destroyed the environment.  He’s the master and Trump’s the stooge, and what’s funny is that Trump doesn’t even know it.  Trump’s always wanted to be part of the in-group, but McConnell is an in-group of one and Trump plays the fool.

“He’s not just divisive.  He’s a destroyer.  To be in his presence makes you die.  He will eat you alive for his own purposes.  I’m appalled that we have a leader who can’t say ‘Black Lives Matter.’  That’s why he hides in the White House basement.  He is a coward.  He creates a situation and runs away like a grade-schooler.  Actually, I think it’s best to ignore him. There is nothing he can do to make this better because of who he is: a deranged idiot.”

--Kareem Abdul-Jabbar / Los Angeles Times

“What was your first reaction when you saw the video of the white cop kneeling on George Floyd’s neck while Floyd croaked, ‘I can’t breathe’?

“If you’re white, you probably muttered a horrified, ‘Oh, my God’ while shaking your head at the cruel injustice.  If you’re black, you probably leapt to your feet, cursed, maybe threw something (certainly wanted to throw something), while shouting, ‘Not @#$%! again!’  Then you remember the two white vigilantes accused of murdering Ahmaud Arbery as he jogged through their neighborhood in February, and how if it wasn’t for that video emerging a few weeks ago, they would have gotten away with it.  And how those Minneapolis cops claimed Floyd was resisting arrest but a store’s video showed he wasn’t.  And how the cop on Floyd’s neck wasn’t an enraged redneck stereotype, but a sworn officer who looked calm and entitled and devoid of pity: the banality of evil incarnate.

“Maybe you also are thinking about the Karen in Central Park who called 911 claiming the black man who asked her to put a leash on her dog was threatening her.  Or the black Yale University grad student napping in the common room of her dorm who was reported by a white student.  Because you realize it’s not just a supposed ‘black criminal’ who is targeted, it’s the whole spectrum of black faces from Yonkers to Yale.

“You start to wonder if it should be all black people who wear body cams, not the cops.

“What do you see when you see angry black protesters amassing outside police stations with raised fists?  If you’re white, you may be thinking, ‘they certainly aren’t social distancing.’  Then you notice the black faces looting Target and you think, ‘Well, that just hurts their cause.’ Then you see a police station on fire and you wag a finger saying, ‘That’s putting the cause backward.’

“You’re not wrong – but you’re not right, either.  The black community is used to the institutional racism inherent in education, the justice system and jobs.  And even though we do all the conventional things to raise public and political awareness – write articulate and insightful pieces in the Atlantic, explain the continued devastation on CNN, support candidates who promise change – the needle hardly budges.

“But Covid-19 has been slamming the consequences of all that home as we die at a significantly higher rate than whites, are the first to lose our jobs, and watch helplessly as Republicans try to keep us from voting.  Just as the slimy underbelly of institutional racism is being exposed, it feels like hunting season is open on blacks.  If there was any doubt, President Trump’s recent tweets confirm the national zeitgeist as he calls protesters ‘thugs’ and looters fair game to be shot.

“Yes, protests often are used as an excuse for some to take advantage, just as when fans celebrating a hometown sports team championship burn cars and destroy storefronts.  I don’t want to see stores looted or even buildings burn.  But African Americans have been living in a burning building for many years, choking on the smoke as the flames burn closer and closer.  Racism in America is like dust in the air. It seems invisible – even if you’re choking on it – until you let the sun in.  Then you see it’s everywhere.  As long as we keep shining that light, we have a chance of cleaning it wherever it lands.  But we have to stay vigilant, because it’s always still in the air.

“So, maybe the black community’s main concern right now isn’t whether protesters are standing three or six feet apart or whether a few desperate souls steal some T-shirts or even set a police station on fire, but whether their sons, husbands, brothers and fathers will be murdered by cops or wannabe cops just for going on a walk, a jog, a drive.  Or whether being black means sheltering at home for the rest of their lives because the racism virus infecting the country is more deadly than Covid-19.

“What you should see when you see black protesters in the age of Trump and coronavirus is people pushed to the edge, not because they want bars and nail salons open, but because they want to live.  To breathe.

“Worst of all, is that we are expected to justify our outraged behavior every time the cauldron bubbles over.  Almost 70 years ago, Langston Hughes asked in his poem ‘Harlem’: ‘What happens to a dream deferred? / …Maybe it sags / like a heavy load. / Or does it explode?’

“Fifty years ago, Marvin Gaye sang in ‘Inner City Blues’: ‘Make me wanna holler / The way they do my life.’  And today, despite the impassioned speeches of well-meaning leaders, white and black, they want to silence our voice, steal our breath.

“So what you see when you see black protesters depends on whether you’re living in that burning building or watching it on TV with a bowl of corn chips in your lap waiting for ‘NCIS’ to start.

“What I want to see is not a rush to judgment, but a rush to justice.”

---

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

We thank our amazing healthcare workers and first responders.

God bless America…warts and all.

---

Gold: $1688
Oil: $38.97

Returns for the week 6/1-6/5

Dow Jones  +6.8%  [27110]
S&P 500  +4.9%  [3193]
S&P MidCap  +8.4%
Russell 2000  +8.1%
Nasdaq  +3.4%  [9814]

Returns for the period 1/1/20-6/5/20

Dow Jones  -5.0%
S&P 500  -1.1%
S&P MidCap  -7.4%
Russell 2000  -9.7%
Nasdaq  +9.4%

Bulls 53.5
Bears 23.7

Hang in there. Keep washing your hands.

Brian Trumbore

***We remember D-Day, June 6, 1944

General Dwight David Eisenhower

[Issued June 5…punctuation correct]

Soldiers, Sailors and Airmen of the Allied Expeditionary Force!

You are about to embark upon the Great Crusade, toward which we have striven these many months. The eyes of the world are upon you. The hopes and prayers of liberty-loving people everywhere march with you. In company with our brave Allies and brothers-in-arms on other Fronts, you will bring about the destruction of the German war machine, the elimination of Nazi tyranny over the oppressed peoples of Europe, and security for ourselves in a free world.

Your task will not be an easy one. Your enemy is well trained, well equipped and battle-hardened. He will fight savagely.

But this is the year 1944! Much has happened since the Nazi triumphs of 1940-41. The United Nations have inflicted upon the Germans great defeats, in open battle, man-to-man. Our air offensive has seriously reduced their strength in the air and their capacity to wage war on the ground. Our Home Fronts have given us an overwhelming superiority in weapons and munitions of war, and placed at our disposal great reserves of trained fighting men. The tide has turned! The free men of the world are marching together to Victory!

I have full confidence in your courage, devotion to duty and skill in battle. We will accept nothing less than full Victory!

Good Luck! And let us all beseech the blessing of Almighty God upon this great and noble undertaking.

[On June 6, Ike issued this statement that was broadcast by Allied radios in London]

People of western Europe: A landing was made this morning on the coast of France by troops of the Allied Expeditionary Force. This landing is part of the concerted United Nations plan for the liberation of Europe, made in conjunction with your great Russian allies.

Although the initial assault may not be made in your own country, the hour of your liberation is approaching….

[Ike then repeated much of the June 5 message.]

---