Week in Review

---

Week in Review

03/06/2021

For the week 3/1-3/5

[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 1,142

Last March 4, New Jersey recorded its first case of Covid-19, a 32-year-old physician’s assistant.  We knew it was coming, after hearing the first stories in New York, and my state would then go through hell in succeeding months, a very scary time as I’ll reflect on further in the coming weeks.  New Jersey has had over 23,500 die from the disease, a heartbreaking figure, but now my state, and the nation, are at a real crossroads.  We have in no means crushed the virus, as caseloads, while way down from the post-holiday peak, are still running 60-70,000 a day when, as I’ve been writing for a while now, we need to get back to the levels of last May-June, in the 20,000 range to really begin to feel good about ourselves.  Yesterday, Dr. Fauci said 10,000 should be the target.

So we are at a way too high plateau, plus testing is lapsing when it is urgent to do just as much as before, in part due to the increasingly successful vaccine rollout which is no doubt giving some a false sense of security when it comes to getting a test.  Many of the sites have been closing because of a lack of use and that’s not good.  We have no idea as to the extent of the variants now spreading across the nation and if you aren’t concerned, read the story on Brazil and Manaus below.

The thing is, we have to get the vaccines out, for every adult by end of May, as President Biden has now assured us, before the variants can take hold….all the more reason to crush the case count.  The fight is far from over.

So what the hell are we doing in taking our masks off, as in the case of Texas and other states?  I get a kick out of those who say, ‘We’re tired of Covid…we want to move on…we have to live our lives.’

Hey, all we were asking everyone to do was wear a mask when around a lot of people in an enclosed area, like the grocery store or pharmacy.  And obviously bars and theaters weren’t a particularly good idea yet.

But Texas has hardly crushed the virus, and the UK variant is spreading there.  When the state mask mandate comes off formally next week, wait for the fireworks and all the stories as store owners, who want to retain a mandate for their establishments, face off against those who want to go maskless.  It’s going to be ugly.  It didn’t have to be.  And, boy, Texas Gov. Greg Abbott is the very definition of a chameleon.

Of course it’s all symptomatic of our total lack of leadership on the Covid issue since Day One, and now here we sit at 535,000 deaths, and countless businesses and dreams crushed, like of those in the Arts.  I think all the time of the orchestra members, for example. 

It’s just that we’re so close…it would be such a shame to have sacrificed so much and then blow it.

But, hey, there was indeed some good news this afternoon.  The U.S. and the European Union reached an agreement to suspend tariffs on wine, luggage, produce and other goods related to a longstanding dispute over government subsidies to Boeing Co. and Airbus SE.

The four-month suspension, while the two sides hopefully work out a permanent agreement, came about following a conversation between President Joe Biden and European Commission President Ursula von der Leyen.

The White House said that Biden underscored to Ms. Von der Leyen his commitment to “repair and revitalize the U.S.-EU partnership.”

Von der Leyen hailed the decision as a fresh start for the trans-Atlantic relationship.

“This is excellent news for businesses and industries on both sides of the Atlantic, and a very positive signal for our economic cooperation in the years to come,” she said in a statement.

And we had a good jobs report today, as I describe below, though we are still down 9.5 million jobs from pre-pandemic levels.

Biden Bits

***Just as I’m going to post, we hear there is a deal on the Covid-19 aid bill with Joe Manchin coming around.  So some of what follows may at the end of the night not necessarily apply, though I hasten to add, regardless of any deal, the process is not over…***

--Senate action on the $1.9 trillion relief bill hit a roadblock on Friday as an eleventh-hour compromise on unemployment insurance benefits seemed to unravel, leaving, as of this evening, the entire effort in limbo and at risk of collapse.

A day that began with Senate Majority Leader Charles Schumer vowing passage of Joe Biden’s first major legislative initiative, was thrown into uncertainty as moderate Democratic Sen. Joe Manchin (W.Va.) balked at a compromise on unemployment benefits that would increase the current level of $300 a week to $400 a week and extend them through August.  The benefits are now set to expire March 14, which has been the deadline Democrats and the Biden administration have been eyeing for weeks for passing the wide-ranging relief bill into law.

But Manchin had expressed persistent concerns about increasing the unemployment benefits, suggesting that doing so could keep workers from rejoining the workforce just as the economy gets back on its feet, which today’s jobs report gave credence to.  Manchin’s view is closer to the Republican view and the West Virginian was seen conversing with Ohio Republican Sen. Rob Portman, who is offering a lesser option on benefits.

So now as I get ready to post, Senate leaders are saying the process is stalled.  And the danger is that any compromise that is reached could require renegotiating the bill passed in the House as the March 14 deadline approaches.

The unemployment benefits tussle is just one piece of a much larger package that includes the $1,400 relief checks to individuals, $350 billion in state and local aid (that Republicans are adamantly against), $130bn for schools, and tens of billions more for food stamps, child tax credits, rental relief and vaccine distribution and testing; many of the provisions actually receiving bipartisan support.

[Earlier, President Biden had agreed to narrow eligibility for the $1,400 stimulus payments to individuals earning up to $75,000 per year and couples making up to $150,000.  The size of the payments would then begin to scale down before zeroing out for individuals earning $100,000 per year and couples making $200,000.]

One provision that was certain not to make the package was the $15 minimum wage proposal, where eight Democrats were siding with Republicans in opposition.

The whole mess started the day before, when Sen. Ron Johnson (R-Wis.) forced Senate clerks to read the entire 628-page bill aloud, a process that took almost 11 hours and concluded around 2:00 a.m. Friday morning.  That came after the Senate voted 51-50 on party lines Thursday afternoon to open the debate, with Vice President Harris breaking the tie.

--Former First Lady Michelle Obama on Thursday urged the Senate to pass a sweeping voting rights overhaul that received House approval this week, warning that “democracy remains under attack” from state officials she believes are attempting to suppress voter turnout.

Obama expressed support for House Resolution 1, also known as the “For the People Act.”  If approved in the Senate, the bill would put nonpartisan commissions in charge of gerrymandering rather than party-controlled state legislatures, expand early voting, and ease restrictions on voter registration at the state level, among other measures.

GOP officials in Georgia, Arizona and many other states have introduced hundreds of bills to tighten voting laws.  In a statement on behalf of her organization “When We All Vote,” Obama praised record turnout during the 2020 president election but suggested that “too many leaders are working to reverse that progress.”

“Make no mistake – the idea that we cannot both hold secure elections and ensure that every eligible voter can make their voices heard is a false choice. It’s based on lies and it flies in the face of our history. It is sad. It is infuriating. And it is a genuine threat to our future that must be taken seriously.”

H.R. 1 passed by a 220-210 vote along party lines.  Senate Democrats will need to secure support from at least 10 Republicans in order to bypass the filibuster and pass the bill.

GOP leaders say the bill is unbalanced in favor of Democrats.

“Democrats want to use their razor-thin majority not to pass bills to earn voters’ trust, but to ensure they don’t lose more seats in the next election,” House Minority Leader Kevin McCarthy said in a floor speech on Tuesday.

Obama said the bill will “make it easier for ordinary Americans to register and cast a ballot” and improve the security of U.S. elections.

The bill’s voting provisions would guarantee no-excuse mail voting and at least 15 days of early voting for federal elections; require states to use their existing government records to automatically register citizens to vote; restore voting rights to felons who have completed their prison sentences; and mandate the use of paper ballots.

Other provisions would create new disclosure requirements for “dark money” donations to political groups; require states to appoint independent commissions to draw congressional districts; create new federal standards for election equipment vendors, as well as one requiring presidential candidates to disclose their tax returns.

But with the Senate rule allowing a 41-vote minority to block most legislation from coming to a final vote, H.R. 1 doesn’t stand a chance.

--Joe Biden suffered his first major setback in filling his cabinet Tuesday as Neera Tanden withdrew from consideration to lead the Office of Management and Budget after facing opposition from senators over her partisanship.

--I will get into the border issue next week.  Republicans are having a field day, but the fact is the number arrested at the Southwest border has gone from 21,000 last May to 75,000 in January.  The numbers arriving are growing now with the perception it is easier to enter the United States with the new president.  Biden has two weeks to figure it out.  The local charities are stressed and Covid is an issue, though to what degree is subject to debate.  There is a lot of B.S. being tossed around. 

The Pandemic

For all the good news on Covid, especially with the increasing vaccine rollout, you have a huge spike in Brazil, with record daily death counts this week, and a very disconcerting surge, in some cases to new highs on cases and deaths, in central and eastern Europe.  Just look at the charts of nations like Poland, Romania, Czechia, Hungary, and Ukraine.  It’s disheartening.

Covid-19 death tolls, as of tonight….

World…2,592,047
USA…535,563
Brazil…262,948
Mexico…189,578
India…157,693
Italy…99,271
Russia…88,285
France…88,274
Germany…72,297
Spain…71,138
Iran…60,512
Colombia…60,300
Argentina…52,784
South Africa…50,566
Peru…47,491
Poland…44,912
Indonesia…37,026
Turkey…28,901
Ukraine…26,763
Belgium…22,196
Canada…22,192
Czechia…21,325
Chile…20,928
Romania…20,785

Source: worldometers.info

U.S. daily death tolls…Sun. 1,283; Mon. 1,439; Tues. 1,989; Wed. 2,350; Thurs. 1,993; Fri. 1,794.

Covid Bytes

--Editorial / Washington Post

“Brazil is reeling from the coronavirus pandemic, and its agony ought to be a warning to the world.  When the virus is spreading out of control and mutating as it is in Brazil, it poses a potential danger everywhere.  Brazil’s surge has given rise to a new variant known as P.1 that appears to be more transmissible and may be capable of overcoming natural antibodies.  So far, 10 cases in five jurisdictions have been detected in the United States, but more may be coming….

“Health systems in more than half the country’s 26 states are at or near capacity.  President Jair Bolsonaro has spurned efforts to combat what he calls a ‘little flu’ and backed useless remedies such as hydroxychloroquine. The country has been consumed by internal divisions and seems unable to pull itself out from the abyss; its vaccination campaign is bogging down in shortages and delays. As with former president Donald Trump, Mr. Bolsonaro’s leadership vacuum has given the virus an opening to spread, especially from mass gatherings during the November elections, then the holidays and finally Carnival celebrations.

“The most worrisome threat comes from Manaus, the largest city in the Amazon region, where the new P.1 variant apparently was spawned.  It is now spreading across Brazil.  Preliminary research suggests that the variant carries 17 mutations from the original coronavirus, three of them in the spike protein used to invade human cells. The new variant, like some others, is believed to be between 1.4 and 2.2 times more transmissible.  But there is another aspect that is worrying researchers.

“In late April 2020, a large epidemic peaked in Manaus, and the city’s hospitalizations remained stable and fairly low from May to November, despite the relaxation of control measures during that period, according to a comment published in the Lancet.  A study of blood donors showed that 76 percent of the population had been infected by October 2020, higher than the theoretical 67 percent threshold for natural herd immunity.

“Then, in January of this year, the virus came charging back in Manaus, leading to more deaths there in the first two months of this year than in all of 2020. What is going on? Scientists fear that the P.1 variant is reinfecting people who previously had Covid-19, indicating that it can sicken those who have antibodies from the first wave. Although the conclusions are still tentative, the implications are grave: It is possible that the virus could challenge vaccines and natural immune systems.

“What happens in Brazil does not stay in Brazil.  As epidemiologist Miguel Nicolelis of Duke University told The Post, ‘If Brazil does not control the virus, it will be the largest open laboratory in the world for the virus to mutate.’  That is a problem for everyone.”

President Bolsonaro, ever the jerk, triggered a wave of revulsion Thursday by telling citizens to stop “whining” about the outbreak.

“Stop all this fussing and whining.  How long are you going to keep on crying?” Bolsonaro asked supporters in the state of Goias, where nearly 9,000 people have died.

--The European Union is planning to extend its export authorization scheme for Covid-19 vaccines to the end of June, as a shipment of AstraZeneca shots from the EU to Australia was blocked on Thursday. Extending controls could reignite tensions with countries who rely on shots made in the EU.

The mechanism was set up at the end of January as a reaction to vaccine makers’ announcements of delays in the deliveries of Covid-19 vaccines to the EU.  It is due to expire at the end of March, but the European Commission wants to extend it through June, two officials said.  “The Commission will propose its extension into June.  And that was greeted by the member states with approval, not necessarily enthusiasm, but there is a feeling that we still need that mechanism,” one senior diplomat told Reuters.

Italian Prime Minister Mario Draghi has also called for sanctions on companies that do not respect their contractual obligations with the EU.

When the EU export control mechanism was introduced in late January it triggered an outcry from importing countries who feared their vaccine supplies might have been hampered.

AstraZeneca had requested permission from the Italian government to export some 250,000 doses from its Anagni plant, near Rome.  The company cut its supplies to the EU in the first quarter to 40 million does from 90 million foreseen in the contract, and later told EU states it would cut deliveries another 50% in the second quarter.  AstraZeneca later said it was striving to supply missing doses for the second quarter from outside Europe.

Britain has so far prevented the export of AstraZeneca vaccines to the EU, using a UK-first clause in its supply contract with the Anglo-Swedish firm.  The United States also has regulations that effectively ban vaccine exports, the EU says.

--Merck said it will help make rival Johnson & Johnson’s single-shot Covid vaccine in a partnership after the Biden administration learned J&J was behind in the production effort, so the White House pushed for a deal between the two.  It will take some time for Merck to bring the selected facilities up to speed but it will be a huge help in the delivery efforts.

After receiving formal FDA approval, J&J was supposed to deliver 12 million doses by the end of February, but had less than 4 million ready to ship when the vaccine was authorized on Saturday.  It expects to be able to deliver another 16 million doses by the end of the month – still well short of its previous commitments.  The company insists it will be able to provide the full 100 million doses it has agreed to supply by its original midyear deadline.

--A World Health Organization team investigating the origins of Covid-19 is planning to scrap an interim report on its recent mission to China amid mounting tensions between Beijing and Washington over the investigation and an appeal from one international group of scientists for a new probe.

The group of two dozen scientists is calling in an open letter on Thursday for a new international inquiry. They say the WHO team that last month completed a mission to Wuhan – the Chinese city where the first known cases were found – had insufficient access to adequately investigate possible sources of the new coronavirus, including whether it slipped from a laboratory.

Their appeal comes as the U.S. – which recently reversed a decision to leave the WHO – lobbies for greater transparency in the investigation, saying it is waiting to scrutinize the report on the Wuhan mission, and urging China to release all relevant data, including on the first confirmed infections in December 2019, and potential earlier ones.

Beijing, meanwhile, is pressing for similar WHO-led missions to other countries, including the U.S., to investigate whether the virus could have originated outside China and spread to Wuhan via frozen food packaging.

WHO chief Tedros Adhanom Ghebreyesus said on Feb. 12 that the team would release an interim report briefly summarizing the Wuhan mission, possibly the following week, with a full report coming weeks later. But that summary report has yet to be published and the WHO team is now scrapping that plan, said Peter Ben Embarek, the food-safety scientist who led the team.  The WHO team plans to publish a summary along with the full, final report, he said.  That final report “will be published in coming weeks and will include key findings,” a WHO spokesman said.

Separately, the WHO’s Dr. Michael Ryan cautioned that it was “premature” and “unrealistic” to assume the pandemic would be over before the end of 2021.

Dr. Ryan said the arrival of more and more effective vaccines would lead to fewer hospitalizations and deaths, but a slowly rolled-out vaccine would not be enough to stop the virus’ spread.

“If the vaccines begin to impact not only on deaths and not only on hospitalizations, but have a significant impact on transmission dynamics and transmission risk, then I believe we will accelerate toward controlling this pandemic. Right now the virus is very much in control,” he said.  [Ed. See Brazil]

--Finally, we learned that former President Trump and former First Lady Melania were vaccinated for Covid-19 in January, the shots administered privately at the White House.

It is so pathetic that they did not do this in public like other public officials, including Joe Biden and Mike Pence.  The president could have saved lives with this single move, after costing so many over the previous year by refusing to set an example.

Trump and CPAC

On Sunday at CPAC (Conservative Political Action Conference), taking the stage for the first time since leaving office, former President Donald Trump doubled down on the Big Lie.

“Had we had a fair election, the results would have been much different.”

All 50 states certified the election results, and both state and federal judges (including Trump appointees) rejected scores of court challenges from the Trump campaign.

“This election was rigged, and the Supreme Court and other courts didn’t want to do anything about it.”

“We seem to have more votes than we have people” in Detroit, and “In Pennsylvania, they had hundreds of thousands of more votes than they had people voting.”

Just lies.

Trump did say, “I’m going to continue to fight right by your side.  We’re not starting new parties. We have the Republican Party.  It’s going to be strong and united like never before.”

But he said of Joe Biden, “As you know, they just lost the White House,” then teased the prospect that he will run again in 2024, in an attempt to ‘freeze’ the field.  “I may even decide to beat them for a third time.”  And he said a Republican candidate will win the White House in 2024 – “and I wonder who that will be? …Who, who, who will that be?”

Trump also discussed plans to inject himself into the 2022 congressional elections, backing Republicans who subscribe to his “Make America Great Again” agenda – and opposing GOP members who backed impeachment over his role in the Jan. 6 insurrection.

“Get rid of them all,” Trump said, calling out the names of all ten House Republicans who voted for impeachment, and all seven Senate Republicans who voted for conviction.  “The RINOs that we’re surrounded with will destroy the Republican Party,” he said, referencing the term for “Republicans in Name Only.”

Trump did not discuss the Jan. 6 attack.

Editorial / Wall Street Journal

“As for Republicans and Mr. Trump, the future isn’t as clear as the press and the former President would like. The CPAC crowd cheered his speech, which was largely a collection of greatest political hits.  But if CPAC represented America, Mr. Trump would still reside in the White House, not Mar-a-Lago. He lost to Joe Biden, the old Democratic war horse, by seven million votes.  He also lost five states he carried in 2016, even Georgia.

“That’s the cold GOP reality as the former President seeks to dominate the party from exile and tease a 2024 comeback.  Mr. Trump boasted about his record vote total for an incumbent President, and he took credit for every GOP success down the ballot in 2020.

“We welcome the debate, but if 2020 was so fabulous, why are Republicans shut out of power up and down Pennsylvania Avenue?  They have zero influence over the $1.9 trillion spending extravaganza they rightly deplore.  Democrats are slowly erasing the Trump legacy on taxes, deregulation, energy, education, and so much more.

“This didn’t have to happen. Incumbent presidential races are typically consolidating elections as the party in power reinforces gains from four years earlier. The Trump years are a rare exception, as Mr. Trump never reached a job approval rating above 50% despite his policy achievements. The public dislike is personal. 

“Republicans lost the House in 2018 as suburban voters fled to check Mr. Trump.  He proceeded to lose the White House on Nov. 3, and he cost the GOP two Georgia Senate races on Jan. 5 as he made his claims of election fraud the main issue rather than checking Mr. Biden and Nancy Pelosi.  Mr. Trump essentially told his Georgia supporters their votes didn’t matter, and many stayed home. The GOP lost the Senate.

“Mr. Trump is now trying to rewrite this history as someone else’s fault – Democrats who cheated, Republicans who won’t ‘fight,’ a cowardly Supreme Court that includes three of his appointees, anyone but himself.  This isn’t true, as another Trump pollster, Anthony Fabrizio, made clear in his post-election analysis.  Mr. Trump had one landmark victory in 2016 but he has cost the GOP dearly since.

“Mr. Trump said Sunday that he won’t form a third party because it would divide the center-right coalition and elect Democrats. But he also laid out his political enemies list and is clearly bent on revenge against anyone who voted to impeach or convict him or disagrees with his election claims. These intra-party fights will sap GOP energy and resources when their priority now should be retaking Congress in 2022.

“Mr. Trump’s base of support means he will play an important role in the GOP.  But as the Biden months roll on and the policy consequences of the 2020 defeat become stark, perhaps the party’s grassroots will begin to look past the Trump era to a new generation of potential standard-bearers.  As long as Republicans focus on the grievances of the Trump past, they won’t be a governing majority.”

So after this editorial, Trump lashed out in an emailed statement, blaming Georgia Gov. Brian Kemp’s failure to counter alleged voting irregularities in the state for dampening Republican voter turnout in the Georgia Senate runoffs.

“To set the record straight, there were two reasons the Senate races were lost in Georgia,” Trump wrote.

“First, Republicans did not turn out to vote because they were so angry and disappointed with Georgia Republican leadership and Governor Kemp for failing to stand up to Stacey Abrams and the disastrous Consent Decree that virtually eliminated signature verification requirements across the state (and much worse), and was not approved by the State Legislature as required by the Constitution  - having a major impact on the result, a rigged election,” the statement continued.

“Even more stupidly, the National Republican Senatorial Committee spent millions of dollars on ineffective TV ads starring Mitch McConnell, the most unpopular politician in the country, who only won in Kentucky because President Trump endorsed him,” Trump said in the statement.

“He would have lost badly without this endorsement,” Trump said.

Oh brother.

“Second, Senator Mitch McConnell’s refusal to go above $600 per person on the stimulus check payments when the two Democrat opponents were touring $2,000 per person in ad after ad. This latter point was used against our Senators and the $2,000 will be approved anyway by the Democrats who bought the Georgia election – and McConnell let them do it!,” he said.

Then Trump went after the Wall Street Journal for the above editorial.  He said the editorial page “continues, knowingly, to fight for globalist policies such as bad trade deals, open borders, and endless wars that favor other countries and sell out our great American workers, and they fight for RINOs that have so badly hurt the Republican Party.”

“That’s where they are and that’s where they will always be.  Fortunately, nobody cares much about The Wall Street Journal editorial anymore. They have lost great credibility,” he continued.

So that spurred the Journal’s editorial board to fire off another missive of its own:

“For someone who says we don’t matter, he sure spends a lot of time reading and responding to us.  Thanks for the attention.

“What really seems to rankle the most famous resident of Mar-a-Lago isn’t his caricature of our policy differences.  It’s that we recognize the reality that Mr. Trump is the main reason Republicans lost two Georgia Senate races in January and thus the Senate majority.  Mr. Trump refuses to take responsibility for those defeats, contrary to all evidence….

“All the polling (in Georgia) showed that the best argument for electing the two Republicans was as a check and balance against an all-Democratic government. But rather than make that point to voters, Mr. Trump focused on his grievances against Mr. Kemp and his claims that the election was stolen.  Mr. Trump told Republican voters that their November votes had been meaningless, so it’s hardly a surprise their turnout fell in January.  As the FiveThirtyEight website found, ‘The better Trump did in a county in November, the more its turnout tended to drop in the runoffs’ in January.

“Mr. Trump also blames Mr. McConnell’s ‘refusal to go above $600 per person on the stimulus check payments when the two Democrat opponents were touting $2,000 per person in ad after ad.’ This rewrites history.

“Mr. Trump’s Treasury Secretary announced support for the $600 checks on Dec. 8, and the GOP swung behind the proposal.  He didn’t endorse the $2,000 checks until Dec. 22, giving Democrats a sword against the two GOP Senate candidates who had endorsed $600.  The two eventually endorsed $2,000 but looked unprincipled in doing so.  Mr. Trump’s $2,000 flip-flop knee-capped his own party’s candidates….

“We rehearse all this because it matters to GOP fortunes going forward.  In the single Trump term, Republicans lost the House, White House and finally the Senate.  How can it be that everyone other than the most prominent Republican in the country is responsible for victories but not the defeats that have left Republicans in the wilderness/

“Losing to Joe Biden of all people, and by 7.1 million votes as an incumbent President, must be painful.  Counseling could be in order.  Any good analyst will explain that the first step toward recovery is to accept reality. The same applies to Republican voters who want to win back Congress in 2022 and the White House in 2024.”

Oh, and in an interview on Fox News Sunday night with Steve Hilton, Trump denied that he was watching live television coverage of the Capitol Hill riot.

“First of all, I wasn’t watching TV.  I turned it on later on when I heard about it, and did a lot of moves.”

Well, this is the guy who cheats playing golf.  That was always my first metric.

--On the issue of Jan. 6, FBI Director Christopher Wray defended the bureau’s handling of information warning of the prospect of violence by Trump supporters and described an increasingly complex extremist threat landscape in the wake of the attack on the Capitol.

“The problem of domestic terrorism has been metastasizing across the country for a long time now, and it’s not going away anytime soon,” Wray told the Senate Judiciary Committee at a Tuesday hearing, adding that the ideologies motivating a variety of extremists were proving difficult to pinpoint.

“In some cases, it seems like people are coming up with their own sort of customized belief systems – a little bit of this, a little bit of that – and they put it together maybe combined with some personal grievance or something that’s happened in their lives,” he said. “Trying to get your arms around that is a real challenge.”

On Jan. 5, the FBI’s Norfolk, Va., office warned in a report that online message-board traffic urged people to go to Washington “ready for war” and shared maps of the Capitol, law-enforcement officials have said.  However, Mr. Wray said, the information in the report was uncorroborated and investigators were unable to link it to specific people, making follow-up difficult.

While senators repeatedly questioned why the bureau didn’t raise more urgent and actionable flags based on the jarring report, they stopped short of criticizing the FBI’s response more broadly.

“The information was raw, it was unverified.  In a perfect world, we would have taken longer to be able to figure out whether it was reliable,” Wray said, adding that officials disseminated the information to other law-enforcement agencies as quickly as possible, including through a joint terrorism task force.

Editorial / Washington Post

“One phrase was repeated over and over at Wednesday’s Senate hearing on the Jan. 6 insurrection at the Capitol: Three hours and 19 minutes.  Three hours and 19 minutes.  That is how long it took the Pentagon to agree to dispatch troops to help beleaguered Capitol Police overrun by the violent pro-Trump mob.  Lawmakers were clearly incredulous about the agonizing delay, and rightly so. Equally stupefying was the lack of any good explanation as to why, despite frantic and repeated pleas from officials on the scene as well as the live broadcast of the chaos on television, the Defense Department delayed in sending help….

“Maj. Gen. William Walker (commanding general of the D.C. National Guard) didn’t pull any punches in detailing what he called ‘unusual’ Pentagon restrictions that hamstrung his ability to provide emergency assistance.  He laid out a timeline that began at 1:49 p.m. with a frantic phone call from the then-head of the Capitol Police reporting a ‘dire emergency’ with the breach of the security perimeter by hostile rioters and requesting immediate assistance.  Maj. Gen. Walker promptly alerted Army leadership, but said he encountered resistance from officials worried about the ‘optics’ of sending in troops.  He said he didn’t receive authorization to send forces to the Capitol until 5:08 p.m.

“Had he not been restricted, including in deploying a quick-reaction force, he said he would have been able to send 155 soldiers to the Capitol hours earlier.  ‘I believe that number could have made a difference,’ he said. …Most vivid was his description of readying troops and then having them sit on buses waiting for a green light from the Pentagon – this while the Capitol was being ransacked, and frightened members of Congress and their staffs were hiding from the mob.”

Yes, we need a 9/11 style commission.

---

Wall Street and the Economy

Asked Thursday at a Wall Street Journal forum about the recent climb in long-term interest rates, Fed Chairman Jerome Powell said it “was something that was notable and caught my attention.”  But he signaled no imminent policy response from the central bank.

As bond yields have risen, some investors have begun to speculate that the Fed could start to skew its asset purchases or holdings toward longer-dated instruments in order to keep borrowing costs low.

But Powell said while inflation is likely to rise as the economy recovers, he feels it will be temporary.

“We expect that as the economy reopens and hopefully picks up, we will see inflation move up through base effects,” Powell said.  “That could create some upward pressure on prices.”

So that spooked the markets Thursday, even though Powell reiterated he doesn’t expect any move up in prices to be long lasting or enough to change the Fed’s accommodative monetary policy.

For all our bitching about prices at the grocery store, or now gasoline prices, or the cost of health insurance, we can’t ignore that the Fed only cares about its prime inflation benchmark, the personal consumption expenditures index (PCE) and as noted last week, it is currently at 1.5%.

Raising interest rates, Powell said Thursday, would require the economy to get back to full employment, which we are far from, and inflation to hit a sustainable level above 2%. He doesn’t expect either to happen this year.

“There’s just a lot of ground to cover before we get to that,” he said.  Even if the economy sees “transitory increases in inflation…I expect that we will be patient.”

Now if the PCE suddenly gets to, say, 2.2% and seems headed higher, the markets will panic a bit, if they haven’t already in anticipation of such a move.

Lastly, the Congressional Budget Office said Thursday that is projects the U.S. federal debt will nearly double to 2020% of GDP by 2051.  A major factor in the buildup of U.S. debt in future decades in the CBO analysis is an assumption that interest rates will rise from historically low levels as the economy recovers. The CBO projects 10-year Treasury note yields to average 1.6% from 2021 to 2025, rising to 3.0% from 2026 to 2031 and reaching 4.9% by 2051.  The CBO’s analysis shows higher interest rates increasing both annual deficits and the debt-to-GDP ratio.

“Because debt is already high, even moderate increases in interest rates would lead to significantly higher interest costs,” it said.

Which is exactly what I’ve been harping on for weeks and months. In fact, in noting the CBO’s February 10-year budget projection of just a few weeks ago and their interest rate projections, I said they were way too low.  Well guess what?  They’ve now moved them up!

As for the U.S. economy and the data this week, in keeping with the above discussion, we had the release of the February employment report today and 379,000 jobs were created, far more than expected, with January revised up from 49,000 to 166,000.  The unemployment rate ticked down to 6.2% from 6.3%.  U6, the underemployment rate, however, remained unchanged at 11.1%.  Average hourly earnings rose just 0.2% from the month before, but are up 5.3% year-over-year.

The leisure and hospitality sector was the big beneficiary, up 355,000, with the lions share of that in the restaurant sector as the economy has been gradually opening up.  Government jobs, both federal and local, though, fell about 80,000, which is what part of the Democrats’ Covid relief plan addresses. 

In other important news, the ISM February manufacturing reading was 60.8, a three-year high (50 being the dividing line between growth and contraction), with the new orders component up to 64.8.  But the ISM services (non-mfg.) reading was disappointing, 55.3 vs. 58.7 prior, which was also the consensus for February.

Construction spending in January rose a strong 1.7%, while factory orders in the month were up 1.6%.

The weekly jobless claims figure was still way too high, 745,000, vs. a prior revised 736,000, or basically three+ times pre-pandemic levels.

The Atlanta Fed’s GDPNow barometer for first-quarter growth is at 8.3% after all of this week’s data.

Europe and Asia

So it was PMI week and the final eurozone composite reading for February was 48.8, up from January’s 47.8.  Manufacturing was a strong 57.9 vs. 54.8 in January, with services 45.7 vs. 45.4.

Germany: 60.7 mfg., 37-mo. high; 45.7 services (non-mfg.)
France: 56.1 mfg., 37-mo. high; 45.6 services
Italy: 56.9 mfg., 37-mo. high; 48.8 services
Spain: 52.9 mfg., 43.1 services
Ireland: 52.0 mfg., 41.2 services
Netherlands: 59.6 mfg.
Greece: 49.4 mfg.

UK: 55.1 mfg., 49.5 services, up from 39.5 in Jan.

[Data courtesy of IHS Markit]

Chris Williamson / IHS Markit

“A fourth successive monthly drop in business activity puts the eurozone economy on course for a double-dip recession, though an easing in the rate of decline underscores how the latest downturn appears far less severe than the initial hit from the pandemic last year.

“While many hospitality-based companies in the service sector continue to struggle due to Covid-19 related restrictions, manufacturing is faring well and alleviating the overall economic impact of lockdown measures.  Even some hard-hit parts of the service economy are showing greater resilience than last year, suggesting some adaptation to the constraints of social distancing.

“However, it’s becoming clear that many virus-fighting measures will need to be in place for some time to come, in part due to the slow vaccine roll-out.  This could extend the drag on the economy from the pandemic into the second half of the year and subdue the pace of recovery.

“A key question will be the extent to which these containment measures will limit the supply of goods and services at a time of recovering demand, as this will in turn determine pricing power in coming months and affect how long the current bout of sharply rising prices will persist.”

Meanwhile, Eurostat reported that the euro area unemployment rate for January was 8.1%, stable compared with December 2020 and up from 7.4% in January 2020.

Germany 4.6%, France 7.9%, Italy 9.0% (Dec.), Spain 16.0%, Ireland 5.8%.

Eurostat also reported that retail sales in the eurozone fell by 5.9% in January over December, due to increased Covid restrictions; down 6.4% from January 2020.

Brexit: President Joe Biden is “unequivocal” in his support for the Belfast Agreement, the White House has said, following London’s surprise move to extend the grace period for post-Brexit checks on some goods entering Northern Ireland from Britain.

Under the protocol, checks should commence in April on some goods moving from Britain to Northern Ireland, with some goods having been granted an initial “grace period.”

However, in a unilateral move, the British government this week said it would extend the grace period until October, a decision that has escalated tensions between London, Brussels and Dublin.

“If the UK cannot be trusted because they took unilateral action, then they leave the EU with no option” but to take legal action, said Ireland’s Minister for Foreign Affairs Simon Coveney.

London does not expect the arrangements for the inspections to be completed by October. Instead, senior sources said the checks would be partially rather than fully operating by then.  The British government believes that the construction of the posts needed for the checks should continue.

Downing Street on Thursday defended the controversial decision, which prompted threats of legal action from Brussels, insisting it was not in breach of international law.

The EU and Ireland were only told on Tuesday that the unilateral action was being considered for Wednesday.

Turning to Asia…China’s official government manufacturing PMI for February came in at only 50.6 vs. 51.3 in January.  The reading on the service sector was 51.4, down from January’s 52.4.

The Caixin private manufacturing reading for last month was 50.9 vs. 51.5 in January, the slowest rate of growth since May, while non-manufacturing was 51.5 vs. 52.0.

So China’s economy is not quite as robust as officials hoped it would be by now, owing in part to some relatively localized restrictions put in place when infections ticked up in some areas.

But as China kicked off its annual session of parliament this week, Premier Li Keqiang touted the achievements of the previous year as China overcame the pandemic, and laid out ambitions to solidify the economic recovery, cut emissions, invest in innovation and improve a worsening demographic outlook.

Also on Friday, Beijing unveiled its next five-year plan, pledging to lift annual research and development spending by more than 7% until 2025, highlighting a commitment to become self-sufficient as the country clashes with the United States and other countries over technology policy.*

Premier Li singled out key areas in which to achieve “major breakthroughs in core technologies,” including high-end semiconductors, operating systems, computer processors and cloud computing – areas in which American firms now hold sway.

China is moving quickly to cut its dependence on the West for crucial components like computer chips, an issue that became more urgent after a global shortage of semiconductors worsened during the pandemic.

*The Biden administration plans to allow a sweeping Trump-era rule aimed at combating Chinese tech threats, over objections from U.S. businesses.  The Business Roundtable, a group of CEOs of major companies from Amazon.com and Citigroup to Walmart, called the rule “unworkable for U.S. businesses in its current form.”  The rule would require American businesses of all sizes to get government clearance for purchases and deals involving sophisticated technology with what the regulation calls a “foreign adversary,” or face potential unwinding of the deals or other enforcement. 

On a different issue, Li added China aims to cut carbon dioxide emissions per unit of GDP by 18% from 2020 levels by 2025.

However, as Li noted, consumer spending remains constrained, investment growth lacks sustainability, and “the foundation for achieving our country’s economic recovery needs to be further consolidated,” in a speech that mentioned President Xi Jinping by name 13 times.

Li, who is charged with economic policy, set a growth target of more than 6% this year, defying expectations that China would refrain from setting a goal given global uncertainty caused by the pandemic.

China grew by 2.3% last year, its weakest in 44 years, but was still the only major economy to expand as it largely vanquished the domestic spread of the coronavirus that first emerged in the country in late 2019.

The 2021 economic target was significantly below the consensus of analysts, who expect growth could beat 8% this year from last year’s low base.  In fact last Friday, Liu Shijin, an influential policy adviser to the People’s Bank of China, said China could grow at an 8-9 percent rate in 2021 under “usual circumstances,” so this was viewed at where the government would peg GDP.

China will keep its average annual economic growth rate over the next five years within a “reasonable range,” the government said.

Sidney Leng and Amanda Lee / South China Morning Post

“Just over five years ago, when China ended its controversial, decades-old one-child policy, concerns over a demographic crisis seemed far-fetched.

“Fast forward to 2021, and those concerns and rising level of debt have become two of the biggest issues hanging over the world’s most populous nation, which is also the second-largest economy behind the United States.

“Even though the complete 2020 new births and population data has not yet been released, China’s central government has already raised the possibility that its population could be surpassed by India as early as 2027, citing a low fertility rate.

“China’s fertility rate in 2019 fell to 1.47 births per woman during their childbearing years, just ahead of Japan which has long suffered from a low birth rate and a declining population.” [Ed. 2.1 is replacement level.]

The new census is due to be released in April and data from some provinces and cities indicates declines ranging from 10 to 30 percent.

Last year, 10.035 million newborns were recorded in the Chinese household registration system, down from 11.79 million in 2019.

The government also plans to raise the statutory retirement age in “a phased manner,” with men currently able to retire at 60, and female factory workers as early as 50.

The other big priority is China’s overall public debt.  Last year, the government debt to GDP ratio shot to 270.1 percent from 246.5 percent in 2019 after Beijing raised its budget deficit target and increased local government bond issuance in a bid to boost the economy and save jobs in industries hit by the pandemic.

Turning to Japan…February’s manufacturing PMI was 51.4 vs. 49.8 in January, with services at 46.3 vs. 46.1.

Japan’s new Olympics chief Seiko Hashimoto promised today to revive the Japanese people’s passion for the Summer Olympics and “turn their concerns into excitement.” She told reporters that organizers would do whatever it takes to make the Olympics safe and secure so that they could gain the confidence of the people, who showed strong support for the Games before the onset of the pandemic last year.

An opinion poll published this week by the Yomiuri newspaper showed 58% of people in Japan oppose holding the Games this year, although that figure was about 20 percentage points lower than earlier surveys.

The Olympics are slated for July 23 to Aug. 8.

On a different issue, Bank of Japan Governor Haruhiko Kuroda highlighted climate change on Friday as one of the key themes in guiding monetary policy, but kept his distance from the idea of the central bank buying green bonds.  The comments underscore the bank’s growing focus on climate change, a key topic of debate among central banks, some of which are stepping up purchases of green bonds used to finance clean energy and environmental projects or are considering doing so.

Kuroda told parliament: “Climate change is among the crucial factors affecting the economy and financial system.  In that context, there are ties to the central bank’s mandate.”

Christine Lagarde, president of the European Central Bank, has backed “green” debt in corporate bond-buying schemes.

South Korea’s manufacturing PMI for February was 55.3 vs. 53.2 in January; Taiwan’s was 60.4 vs. 60.2, despite major supply chain issues.

Street Bytes

--Stocks finished mixed, thanks to a strong rally Friday after the positive jobs news, which outweighed concerns over rising interest rates on the long end of the yield curve.  Energy stocks starred as oil spiked to a near two-year high.

The Dow Jones rose 1.8% to 31496, while the S&P 500 gained 0.8%.  But Nasdaq fell a third consecutive week, 2.1%, despite a strong performance today, as the rotation out of tech into cyclicals continued…at least for now.

One tech stock not doing well recently, Tesla (yes, it’s a tech stock), has seen its shares fall 30% since Feb. 8.

--U.S. Treasury Yields

6-mo. 0.05%  2-yr. 0.14%  10-yr. 1.57%  30-yr. 2.30%

By the end of another volatile week in the bond market, the yield on the 10-year had risen a fifth week in a row to 1.57%, the highest weekly close since last February, before the pandemic hit full force and the Fed responded in kind.

--Oil prices surged Thursday, and finished higher still today, after OPEC and a Russia-led coalition of oil producers kept most of their production cuts in place, surprising traders and sending crude up dramatically.

Traders were expecting the group to meter out more oil to the world after prices had climbed steadily from pandemic lows last year.  West Texas Intermediate (that which I quote each week below), hit $64.60 a barrel, its highest intraday level since April 2019, before closing the week at $66.28.

The agreement was reached after an online meeting between the Saudi-led OPEC and a group of non-OPEC producers led by Russia, in the latest shift in a sometimes careening debate over how the ebb and flow of the coronavirus pandemic is affecting the global economy and, by extension, oil demand.

Earlier, Saudi Arabia and Russia were considering a different proposal to boost output.  Separately, the Saudis had been planning to ease in coming months in a unilateral production cut announced in January.  But now it is keeping them in place through April.

But yesterday, Prince Abdulaziz bin Salman, the Saudi oil minister and son of King Salman, said that while there was “no doubt” the market had improved since January, he wanted to “urge caution and vigilance.”

“Let us be certain that the glimmer we see ahead is not the headlight of an oncoming express train.  The right course of action now is to keep our powder dry, and to have contingencies in reserve to ensure against any unforeseen outcomes.”

--Exxon Mobil Corp. says the time has come to turn capturing carbon emissions into a real business, as it faces pressure from activists to become a greener company.

The move represents an about-face for the oil giant, which for years has had a negative view of investing heavily to commercialize carbon-capture projects, saying they made little economic sense without massive government incentives.

So Exxon touted the creation of a new business unit to commercialize the technology of capturing and storing carbon as a primary way of achieving its target for reducing greenhouse gas emission.

“We’ve made enough progress where we are bringing some of the technology to the field now,” CEO Darren Woods said in an interview.  “Couple that with governments around the world putting policies in place, investment interest in the space – all of this is coming together.”

But while the Biden administration supports carbon capture, a process which captures emissions and deposits them underground, huge incentives are needed to spur its deployment.  So far, the primary commercial use for captured carbon has been in deploying it to squeeze more oil and gas out of the ground.

Exxon said Wednesday that by 2040, carbon capture will be a $2 trillion market and that it is the cheapest way to address emissions.

Exxon pledged last month to invest $3 billion in its new low-carbon unit, saying it has 20 projects in the pipeline.

--In keeping with the above, global carbon dioxide emissions dropped by 5.8 percent in 2020 as the pandemic slowed economic activity, but they rebounded at the end of the year and are on course to rise further, the International Energy Agency said on Tuesday.

Major economies led a rebound in December when emissions were 2 percent, or 60 million tons, higher than in December 2019, as a pick-up in economic activity increased energy demand.

China, the world’s biggest emitter of greenhouse gases, was the only country that experienced an increase in emissions last year of 0.8 percent, or 75 million tons, from 2019 levels, the IEA said in a report.

In India, the world’s third biggest emitter, emissions rose above 2019 levels from last September as economic activity increased and restrictions were relaxed.

“The rebound in global carbon emissions toward the end of last year is a stark warning that not enough is being done to accelerate clean energy transitions worldwide,” Fatih Birol, IEA executive director, said.

Emissions will increase in 2021 with the global economic rebound.

--Texas’ power grid operator Electric Reliability Council of Texas (ERCOT) made a $16 billion pricing error in the week of the winter storm that led to power outages across the state, Potomac Economics, the independent monitor for the Public Utility Commission of Texas, which oversees ERCOT, said in a filing.

ERCOT kept market prices for power too high for more than a day after widespread outages ended late on Feb. 17.

“In order to comply with the Commission Order, the pricing intervention that raised prices to VOLL (value of lost load) should have ended immediately at that time (late on Feb. 17),” Potomac Economics said.

“However, ERCOT continued to hold prices at VOLL by inflating the Real-Time On-Line Reliability Deployment Price Adder for an additional 32 hours through the morning of February 19,” it said, adding the decision resulted in $16 billion in additional costs to ERCOT’s markets.

--United Airlines ordered 25 new Boeing 737 MAX aircraft for delivery in 2023 to meet demand recovery in 2022 and ’23.  UAL also moved up delivery of 40 previously ordered MAX aircraft to 2022 and 5 to 2023.  So a bullish announcement for once.

--TSA checkpoint travel numbers…starting with March 1, comparing current traffic to 2019 figures as we were beginning to come down drastically in 2020, especially by March 15.

3/4…52 percent of 2019 levels
3/3…40
3/2…33
3/1…46
2/28…51 percent of 2020 levels
2/27…47
2/26…45
2/25…44

--Some of the biggest U.S. retail, theater, hotel and restaurant chains say they will continue mandating masks and limiting capacity in Texas after the state drops Covid-related restrictions next week.

The move by Gov. Greg Abbott to “open Texas 100%” has divided the business community, with some welcoming the move, while others say it puts the state at risk of a backslide and will make it harder for business to enforce safety protocols.

Most businesses were already operating at an allowed 75% capacity, so the mask shift raises larger questions.

For now, Hyatt Hotels, Target, Starbucks and CVS Health are among the major corporations saying they have no plans to drop mask requirements.  But Albertson’s is among those planning to stop mandating masks, which I’m sure thrills their employees to death.

So store owners insisting on a mask before entering their establishment will feel the heat more than ever from customers who don’t want to comply.

--Target reported markedly higher fiscal fourth-quarter earnings and revenue on Tuesday, as its performance was fueled by robust growth in comparable sales, digital sales, and newer offerings such as drive-up service.

Target posted an adjusted profit of $2.67 a share, compared with $1.69 a share for the same period in 2020.

Revenue for the quarter ended Jan. 30 rose to $28.3 billion, up from $23.4 billion in the 2020 period.  Full-year revenue shot up nearly 20% to $93.6 billion.

“Following years of investment to build a durable, scalable and sustainable business model, we saw record growth in 2020, as our guests turned to Target to safely provide for their families throughout the pandemic,” said CEO Brian Cornell in a statement.  “With the strength of our unique, multi-category assortment and the flexibility we offer through our reliable and convenient fulfillment options, we gained nearly $9 billion in market share in 2020, and grew our revenue by $15 billion, which is more than the 11 prior years combined.”

Target reported digital sales soared 118%, which accounted for 22% of total sales in the fourth quarter, compared with 12% in the prior year.

Overall comparable sales jumped about 21%, year over year, besting analysts’ expectations of 17%.

But the shares suffered a bit when the company declined to issue a financial forecast due to continued uncertainty surrounding the pandemic.

Target, which now has 1,897 stores, also said it raised its starting wage for all U.S. hourly employees to $15 an hour.

--Kohl’s Corp. posted holiday-quarter profit and sales above market expectations on Tuesday, as it reined in costs and Americans loaded their online shopping carts with not just essentials but also leisure goods.

The company’s digital sales surged to account for 42% of net sales in the fourth quarter.  While non-essential retailers like J.C. Penney have struggled, Kohl’s has managed to survive amidst the pandemic by doubling down on its online business.  It has also entered into partnership with PVH Corp.’s Calvin Klein and LVMH-owned beauty chain Sephora to attract younger crowds to its stores.

Kohl’s is also betting on the rise in demand for activewears such as running shoes and workout clothes, just as every other retailer is doing.

Overall net sales declined 10% to $5.88 billion in the quarter, though this was slightly better than expected.  The company also gave guidance for 2021 in line with current estimates, with sales expected to rise in the mid-teens percentage range.

--The nation’s largest supermarket chain, Kroger, posted fourth-quarter sales results that fell short of Wall Street expectations, $30.7 billion, an increase of 6.4% - a bit shy of the $31bn analysts had predicted.

“We finished fiscal year 2020 with strong sales and earnings, as heightened demand for fresh, convenient food and meal solutions across modalities, including in-store, pick up and home delivery, continued,” said CEO Rodney McMullen, in a statement.

Kroger said its total digital sales more than doubled, growing by 116%, topping $10 billion in 2020.

Kroger’s growth was propelled by an epic shift of customers’ food consumption habits amid the pandemic: nearly $1 of every $4 that Americans used to spend going out to eat has shifted away to food consumed at home – so that’s $162 billion extra mostly going into supermarket coffers, according to the Department of Agriculture.  The company also said that much of the change in consumer shopping patterns includes demand for more expensive cooking ingredients from new amateur chefs, such as moi, which would continue to benefit the company in the long run.

Kroger’s total sales surged 8.4% to $132.5 billion in 2020.  Profit came in at $2.6 billion for the year, a 5.6% increase.  Sales, ex-fuel, increased 14.1% for the year.

The company predicted identical sales without fuel would drop 3% to 5% this year, more than expected, with profit of $2.1 billion to $2.2 billion.  It is also upping its minimum wage to $15.50 per hour from $15.  The raises come as its largest union, the United Food and Commercial Workers International, has lobbied for Kroger to reinstitute $2-per-hour “hero bonus” pay the grocer offered on a temporary basis.  The company has said such a permanent increase would be too costly.

--Dollar Tree reported a jump in fourth-quarter earnings on Wednesday as revenue grew, although the result was shy of analysts’ expectations while the budget retailer announced a new $2 billion share buyback authorization.

Revenue for the quarter ended Jan. 30 was $6.77 billion, up from $6.32 billion in the 2020 period.  Analysts had been looking for $6.78bn.  Enterprise-wide same-store sales rose 4.9%, but the Street was expecting about 5.1%.

Same-store sales for the company’s Family Dollar stores rose 8.1% from last year, while Dollar Tree same-store sales edged up 2.4%.

--Apple has reopened all 270 of its stores across the U.S. as the effort to vaccinate more Americans against Covid-19 accelerates.

The stores are subject to different requirements for operation, including face masks, limited store capacity and scheduled shopping sessions.

Globally, 12 Apple stores in France and two in Brazil remain closed.

So I saw what’s happening with Apple firsthand this week.  I went to The Mall at Short Hills for the first time in a year! on Monday, to check out the state of things after our severe lockdown, and also get some exercise.  The Apple store was walled off in a cube-type setup for individual appointments.

But I went back Wednesday (for exercise…I used to be a mall walker December through March, or until it got warmer) and the Apple store had transitioned right back to its normal setup, wide open, though it seemed they were trying to limit the crowd somewhat.  Just funny the timing of my visits.

I was pleasantly surprised that only about four more stores had shut down in the year, though The Mall was not doing well prior to the pandemic.  At least there were some new stores.  As you can imagine, you can get a deal on rent.

But this is one of the three or four highest-end retail malls in the nation and it should survive.  It’s the other more traditional ones with weak anchor tenants that are in a death spiral.  [Short Hills’ anchors are Bloomingdale’s, Macy’s, Nordstrom, and Neiman-Marcus.]

--Wendy’s sees higher adjusted earnings per share for full-year 2021 as results in the fourth quarter rose on increasing global-same-restaurant sales.

Wendy’s reported adjusted earnings of $0.17 per share in the quarter ended Jan. 3, up from $0.08 a year ago, though short of the Street’s expectations for $0.18.  Revenue rose to $474.3 million from $427.2m, also slightly missing analysts’ forecasts.

Global same-restaurant sales increased 4.7% in the quarter as U.S. sales climbed for the 10th consecutive year by 5.5%, offset by a 2.3% decline in international sales.

The company said breakfast is now 6.5% of U.S. sales.

The company expects to open about 250 new restaurants in 2021 to reach 7,000 restaurants globally, with a goal of 8,000 by the end of 2025.

--Zoom Video Communications Inc. said its growth would continue at a rapid pace amid the vaccine rollout, after pandemic lockdowns turned the company into a household name and an investor darling.

The videoconferencing company said Monday that revenue this year would rise more than 41% after more than quadrupling to $2.65 billion in the fiscal year ended in January.  The sharp growth during last year repeatedly outpaced Zoom’s own projections, and the latest result beat a forecast issued in November.

Zoom revenue for the January quarter jumped to $882.5 million from $188.3 million a year earlier, the results beating Wall Street’s targets, driven by the shift to remote work and distance schooling.

The company’s fourth-quarter profit surged to more than $260 million from $15.3 million in the year-prior period.

For the year, profit was $671.5 million on $2.65bn in revenue, compared with $21.8 million in profit and $622.7 million in revenue a year earlier.

In its current fiscal year, zoom expects revenue of $3.76bn to $3.78bn.  The company is also sitting on more than $4 billion in cash.

CEO Eric Yuan said Zoom is evolving into a broader platform offering new services beyond just video-conferencing, such as webinars, chat and third-party applications.

Zoom’s share price, which had more than tripled over the past 12 months, finished down about 10% on the week.

--Warren Buffett’s Berkshire Hathaway Inc. posted an increased fourth-quarter profit Saturday, with the billionaire using his annual shareholder letter to explain a recent surge in stock buybacks.

For the year, Berkshire bought back nearly $25 billion in shares, according to the company’s report.  Until the last few years, Buffett never bought back any Berkshire stock.

But now he defended the strategy, saying they enhanced the intrinsic value for shareholders but still leave ample funds available for any opportunities.

“American CEOs have an embarrassing record of devoting more company funds to repurchases when prices have risen than when they have tanked,” he wrote.

Berkshire has $138.3 billion in available cash and short-term Treasuries.  But it has been a while since Buffett and his crew have invested large sums in a single investment.  Last year, for example, an $8.6bn investment in Verizon and $4.1 billion in Chevron hardly moved the needle.

In the letter, Buffett went after those who are increasingly turning to riskier investments thanks to record-low interest rates.

“Some insurers, as well as other bond investors, may try to juice the pathetic returns now available by shifting their purchases to obligations backed by shaky borrowers.  Risky loans, however, aren’t the answer to inadequate interest rates.  Three decades ago, the once-mighty savings and loan industry destroyed itself, partly by ignoring that maxim,” he said.

More broadly, Buffett wrote: “In its brief 232 years of existence…there has been no incubator for unleashing human potential like America. Despite some severe interruptions, our country’s economic progress has been breathtaking.”

“Beyond that, we retain our constitutional aspiration of becoming ‘a more perfect union.’  Progress on that front has been slow, uneven and often discouraging. We have, however, moved forward and will continue to do so.  Our unwavering conclusion: Never bet against America.”

But he doesn’t like retirees’ chances – at least those on fixed-income investments.

“Fixed-income investors worldwide – whether pension funds, insurance companies or retirees – face a bleak future,” Buffett wrote.

Buffett, 90, also surprised investors by announcing Berkshire’s annual meeting in May won’t be held in Omaha as usual, but rather in Los Angeles.  He also reassured his stockholders that he has no plans to retire.  His long-time partner, Charlie Munger, 97, has also been active of late, granting interviews.

--The availability of Manhattan office space hit another record high in February.  According to the latest monthly report from Colliers, the availability rate was 15.5%, up from 14.9% in January and 9.9% in February 2020.

Downtown Manhattan’s availability rate, at 15.6%, reached its highest mark since 2013.  Midtown and Midtown South were at 16.2% and 14.6%, respectively.  Average asking rent in the borough dropped for the eighth month in a row to $73.12 per square foot, a 0.7% decline from January and the lowest average since March 2018.

--Walt Disney Co. will close at least 60 Disney retail stores in North America this year as the company revamps its digital shopping platforms to focus on e-commerce, the company said on Wednesday.  Disney also is evaluating a significant reduction of stores in Europe, adding that locations in Japan and China will not be affected.  The company currently operates roughly 300 Disney stores around the globe.  The company didn’t specify the accompanying job loss.

Over the past few years, Disney has expanded its shops inside other retailers such as Target. Those locations will continue to operate.

--Facebook is lifting its temporary ban on political advertising in the United States. The social media giant has had a months-long freeze on political, electoral and social ads, which it introduced as part of an effort to crack down on misinformation and abuses around the Nov. 3 elections.

--Brazil’s economy shrank by 4.1% last year due to the pandemic, its worst drop in decades, data showed on Wednesday, as the above-noted second wave threatens to cut short a stronger-than-expected rebound at the end of 2020.  Latin America’s largest economy grew by 3.2% in the fourth quarter, according to official statistics agency IBGE.

But the recovery, based on consumption by households receiving emergency government cash transfers, may be eroded by a resurgent outbreak now killing record numbers of Brazilians.

--Hong Kong’s retail sales fell 13.6% in January as coronavirus restrictions curbed various economic activities in the Asian financial hub.  It was the biggest drop since July 2020, when sales fell 23.1% year-on-year.  Inbound tourism remains frozen, but as I’ve written, even regular tourists such as myself have to rethink ever going to Hong Kong again after the Chinese takeover, especially with all I’ve written over the years.

Get this…tourist arrivals plunged 99.5% in January from a year earlier, the tourism board said recently.

--The Bank of Ireland confirmed Monday it was closing 103 branches on the island of Ireland from September, reducing its network in the Republic by about a third and its locations in the North by more than half, as Covid-19 has accelerated a shift in the industry towards digital banking.

The bank has signed a deal to allow personal and business customers to use their local An Post office for certain services, including cash withdrawals and cash and check deposits.  If you’ve been to Ireland, you know in the small villages the post office is the key to everything.

--Howard Lutnick’s BGC Partners says two employees stole $35.2 million over several years.

“It was certainly an unfortunate event,” the bond broker’s chief financial officer said on a conference call last week.  The theft is equal to nearly three-quarters of last year’s net income.

It’s a big embarrassment for Lutnick, who became famous for rebuilding Cantor Fitzgerald after 9/11 and serves as chairman of commercial real estate services firm Newmark Group.  He is also CEO and chairman of BGC, a publicly traded brokerage firm controlled by privately held Cantor.

BGC said the theft didn’t involve the operations or business of the company.  It’s accounting firm is Ernst & Young.  Needless to say, many are wondering how such a theft could go undetected for several years.

Foreign Affairs

Iran/Iraq: Pope Francis arrived in Baghdad today for the start of an historic, incredibly risky trip, as he becomes the first pontiff to ever visit the country, this also being his first international trip since the start of the pandemic.

The pilgrimage is meant to reassure Iraq’s dwindling Christian community and foster inter-religious dialogue.

The Pope will meet Iraq’s most revered Shia Muslim cleric, Grand Ayatollah Ali al-Sistani in Najaf on Saturday.

About 10,000 Iraqi Security Forces personnel will be deployed to protect the Pope, while round-the-clock curfews are also being imposed to limit the spread of the coronavirus, as Iraq hit a new daily case high this week.

In a speech after being welcomed by Iraqi President Barham Salih, Francis said he was very pleased to come to Iraq, which he described as the “cradle of civilization.”

“May the clash of arms be silenced…may there be an end to acts of violence and extremism, factions and intolerance!” he said.

“Iraq has suffered the disastrous effects of wars, the scourge of terrorism and sectarian conflicts often grounded in a fundamentalism incapable of accepting the peaceful coexistence of different ethnic and religious groups.”

Turning to the country’s Christians, the Pope said:

“The age-old presence of Christians in this land, and their contributions to the life of the nation, constitute a rich heritage that they wish to continue to place at the service of all.”

He said Iraq’s diversity was a “precious resource on which to draw, not an obstacle to eliminate.”

The Pope’s visit comes amid heightened tensions between the United States and Iran after a new rocket attack against Iraq’s Ain al-Asad air base that hosts U.S. forces, which U.S. officials said fit the profile of a strike by Iran-backed militia, with one report saying the missiles used were like those used by Hizbullah.

No U.S. soldiers were killed but a U.S. contractor died after suffering a “cardiac episode” while sheltering from the rockets.

It was a week ago that U.S. forces carried out air strikes against facilities at a border control point in Syria used by Iranian-backed militias.

Meanwhile, Iran on Sunday ruled out holding an informal meeting with the United States and European powers to discuss ways to revive its 2015 nuclear deal with major powers, insisting that Washington must lift all its unilateral sanctions, while Washington says Tehran must first return to compliance with the deal, which it has been progressively breaching. 

“Considering the recent actions and statements by the United States and three European powers, Iran does not consider this the time to hold an informal meeting with these countries, which was proposed by the EU foreign policy chief,” an Iranian Foreign Ministry spokesman said.

A White House spokeswoman said that it was disappointed Iran had ruled out an informal meeting.

Afghanistan: Three female media workers were shot dead in the eastern Afghan city of Jalalabad on Tuesday, amid a wave of killings that is spreading fear among professional workers in urban centers.  The three women, ages 18 to 20, worked at a local television station and were killed on their way home from work, with witnesses saying gunmen shot them in the head before fleeing.  A fourth woman was critically injured.  Officials later said the lead attacker was arrested and was connected to the Taliban. The Taliban denied responsibility.

The TV station, Enikas, had employed 10 women but now four have been killed, the fourth last year.

The Taliban and Afghan government are carrying out peace talks in Doha, though progress has slowed while President Biden’s administration reviews its plans for the peace process and the withdrawal of troops.

May 1 is the deadline for the U.S. to withdraw its troops per the deal negotiated by the Trump administration and the Taliban and it is rapidly approaching.  Among those hoping the U.S. extends its departure date is Pakistan, which is worried a chaotic pullout could affect them as well as other countries in the region.

Lebanon: Protesters blocked roads this week after the currency tumbled to a new low in a financial meltdown that has fueled poverty. The people just can’t bear it anymore.

Crushed under a mountain of debt, Lebanon is grappling with a financial crisis that has wiped out jobs, raised warnings of growing hunger and locked people out of their bank deposits.  The collapse of the Lebanese pound, which fell to 10,000 to the dollar on Tuesday, has slashed about 85% of its value in a country relying heavily on imports.  Consumer goods, such as diapers or cereals, have tripled in price since the crisis erupted.

Political leaders have failed to agree to a rescue plan since the crisis erupted in 2019 as dollar inflows dried up. At the time, protesters had swept the country angry over economic hardship and new tax plans, including a daily 20-cent fee on Whatsapp calls.  Last August’s port blast that devastated much of Beirut only added to the tragedy on the ground here.

Syria: UN investigators said tens of thousands of civilians are still missing after being detained arbitrarily during 10 years of civil war in Syria.  Thousands more have been tortured or killed in custody, according to a new report detailing alleged war crimes and crimes against humanity by all parties.

The fighting has left at least 380,000 people dead and caused half the population to flee their homes, including almost six million refugees abroad.

The report by the UN Human Rights Council’s Independent International Commission of Inquiry on Syria was based on more than 2,650 interviews and investigations into more than 100 detention facilities. It documents violations by almost every major party to the war that were apparently intended to intimidate and punish perceived opponents.

Saudi Arabia: The United States is focused on “future conduct” of Saudi Arabia and will expect Riyadh to improve its human rights record, a U.S. spokesman said on Monday, after Washington imposed sanctions on some Saudis for the killing of journalist Jamal Khashoggi but fell short of sanctions against Saudi Crown Prince Mohammed bin Salman.

The U.S. declassified a report last Friday that said the crown prince approved the 2018 operation to kill the journalist and issued some sanctions against Saudi nationals and entities.  Many said this was not enough…but they are ignoring reality, as awful as it may be.

State Department spokesman Ned Price said at a press briefing Monday: “We are very focused on future conduct and that is part of why we have cast this not as a rupture, but as a recalibration” of U.S.-Saudi relations.  “We are trying to get to the systemic issues underlying the brutal murder of Jamal Khashoggi,” Price said.

Editorial / New York Times

“The Biden administration formally acknowledged on Friday what President Donald Trump would not, that Crown Prince Mohammed bin Salman of Saudi Arabia approved the plan to kill the dissident journalist Jamal Khashoggi. But Mr. Biden seems to have concluded that the potential cost of taking action against the 35-year-old de facto ruler of a key American ally was simply too high.

“In making the intelligence conclusions public with only minimal redactions, the administration did what should have been done a long time ago. The report was demanded by Congress more than a year ago, and its conclusions amounted to a summary of what has been widely reported: Mr. Khashoggi, a critic of the crown prince living in exile and writing for The Washington Post, was lured into the Saudi consulate in Istanbul in 2018, and there he was killed and dismembered by a team of Saudi assassins.  That this could not have been done without at least the assent of the crown prince was generally presumed.

“The intelligence community’s conclusion, set out in the two-page report, was that the crown prince’s control of major decision-making in the kingdom, the role of his advisers and personal security detail in the operation and his ‘support for using violent measures to silence dissidents abroad, including Khashoggi,’ all indicated that Prince Mohammed was behind the murder.

“Mr. Trump knew this but had balked at publicly chastising one of the Middle East’s most powerful rulers, whom he regarded as a close ally in his feud with Iran and as a lucrative client for American arms.  ‘Maybe he did and maybe he didn’t!’ was the former president’s morally rudderless public response to intelligence that the crown prince in fact did have a role in Mr. Khashoggi’s murder.

“During his presidential campaign, Mr. Biden talked of far sterner measures – ‘I would make it very clear we were not going to, in fact, sell more weapons to them, we were going to make them pay the price and make them the pariah that they are.’

“Earlier this month [Feb.], the president announced that he was banning billions of dollars in arms shipments to Saudi Arabia for its continuing war in Yemen, which has created a humanitarian disaster.  In conjunction with the publication of the intelligence assessment, the administration this week announced more travel bans against Saudi officials involved in the Khashoggi operation, and the State Department added a new category of sanctions, named ‘Khashoggi ban,’ to withhold visas from anyone involved in state-sponsored efforts to harass, detain or harm dissidents and journalists around the world.

“But when it came to penalizing the crown prince personally, Mr. Biden ended up in the same place as his predecessor. In effect, Mr. Biden acknowledged that relations with Saudi Arabia, an ally against the ambitions of Iran, a tacit ally of Israel, a trade partner worth tens of billions of dollars and an oil producer with the ability to seriously disrupt the world economy, were too important to American interests to risk by punishing the all-powerful prince.

“Still, there is a small measure of justice in letting Prince Mohammed know that the deference he enjoyed from Mr. Trump and his son-in-law, Jared Kushner, is over; that his protestations of innocence are known to be false; and that the world knows that he has a journalist’s blood on his hands.”

Editorial / Wall Street Journal

“Secretary of State Antony Blinken also announced Friday what he called a ‘Khashoggi Ban,’ a new visa-restriction policy on individuals who ‘are believed to have been directly engaged in serious, extraterritorial counter-dissident activities.’  The U.S. will apply the new ban to 76 Saudis, and it might do some good as a warning to foreign officials that they and their families could be barred from the U.S. if they act against opponents abroad.  Don’t underestimate how many foreign leaders want to send their children to Stanford or Duke.

“But note that the U.S. didn’t apply that sanction to MBS, who is the Saudi defense minister and probably the next King.  Democrats and the media are already calling this inadequate and want MBS barred if not indicted.  The Biden Administration seems to appreciate that this would lead to a more serious break in U.S.-Saudi relations that would help adversaries in Tehran, Moscow and Beijing.

“Mr. Trump had a moral tin ear, but his support for the Saudis and Israel, and opposition to Iran’s nuclear ambitions, helped pave the way for the historic Abraham Accords between Israel and Arab states. The Biden Administration should think twice about alienating the Saudis, who are rare U.S. friends in a dangerous part of the world.

“The Khashoggi murder was an especially brutal assault on a political opponent, but we can think of others who could make the new ‘ban’ list.  If MBS qualifies, then how about Vladimir Putin’s Kremlin coterie and members of the Chinese State Council ultimately responsible for the arrest of democrats in Hong Kong?  Or the terror sponsors in Tehran that Mr. Biden seems intent on courting?

“The Khashoggi report and sanctions send a message of U.S. disgust at an awful crime.  But in a nasty and brutish world, the U.S. still needs partners like the Saudis.”

China: 47 Hong Kong opposition politicians and activists faced subversion charges after their arrests last month and initially 15 were granted bail, but then they were immediately ordered to remain in custody after prosecutors lodged an appeal against the decision.

The 47, including former lawmakers and incumbent district counselors from the opposition camp, were first arrested in January for taking part in what authorities alleged was a subversive plot to seize control of the legislature with the ultimate aim of paralyzing the government and toppling the city’s leader.

Earlier this week, hundreds of supporters gathered outside the courthouse waiting for the results of the hearings, risking arrest themselves.

During Friday’s parliamentary session, Beijing proposed legislation that would tighten its authoritarian grip on Hong Kong by making changes to the electoral committee that chooses the city’s leader, giving it new power to nominate legislative candidates; thus further marginalizing a democratic opposition, which as in the above is being decimated.

Separately, Hong Kong’s financial authorities are fuming that the Heritage Foundation, publishers of an annual ranking on economic freedom, removed Hong Kong from their list.

This is big, as Hong Kong topped the rankings for 25 years before being supplanted by Singapore last year.  The Heritage Foundation says Beijing “ultimately controls” the policies offering Hong Kong and Macau greater economic freedom and thus they were classified as being under China, not appearing under their own names.

The Heritage Foundation is an influential right-wing think tank, which has strong ties to the Trump administration.  It takes a conservative position on social issues, but promotes free market economies and deregulation.

Meanwhile, tensions between China and Taiwan continue to ratchet up amid Beijing’s annual “two sessions” legislative meetings, just months ahead of the symbolically important 100th anniversary of the ruling Communist Party.

President Xi has said that the “reunification” of Taiwan with the mainland is key to his goal of “national rejuvenation.”

The “two sessions” will discuss the growing risk of conflict over Taiwan, with Beijing ramping up its hawkish rhetoric and pressure campaign against the island as President Tsai Ing-wen’s government deepens ties with the United States, whose relations with China have sunk to the lowest level in decades. While official cross-zone dialogue is off the table, Beijing is continuing to apply the pressure militarily.

China’s defense ministry also issued a stark warning to President Biden – whose administration has said it had a “rock-solid” commitment to supporting Taiwan – that “Taiwanese independence means war.”

Myanmar: At least 38 protesters were killed on Wednesday as security forces opened fire with live bullets. This came just days after 18 had been killed in the then-deadliest day of protests against the February 1 coup.

Germany: Germany BfV domestic intelligence service has formally placed the far-right Alternative for Germany (AfD) under surveillance on suspicion of trying to undermine Germany’s democratic constitution.  After four years ago becoming the first avowedly anti-immigrant party to enter the German parliament, the AfD now becomes the first party to be monitored in this way since the Nazi era ended in 1945. 

It was propelled into the Bundestag in 2017 by voters angry with Chancellor Angela Merkel’s decision to welcome more than one million migrants.  But it has been ostracized by other parties, which say its rhetoric contributes to an atmosphere of hatred that encourages violence against immigrants.

The AfD registered 12.6% support in the 2017 federal election to become the third-biggest party in the Bundestag, and also has lawmakers in all 16 regional assemblies. But its support has fallen to some 9% in recent surveys.

Russia: The Kremlin said on Tuesday that any new U.S. sanctions over the treatment of Kremlin critic Alexei Navalny would not achieve their goal and would merely worsen already strained relations.  Tuesday, the Biden administration imposed sanctions blocking top Kremlin officials from accessing assets in the U.S.

France: Former president Nicolas Sarkozy was sentenced to three years in jail, two of them suspended, for corruption.

He was convicted of trying to bribe a judge in 2014 – after he left office – by suggesting he could secure a prestigious job for him in return for information about a separate case.

Sarkozy, 66, is the first former French president to get a custodial sentence.  He will remain free during the appeal process, which could take years.

The crimes were specified as influence-peddling and violation of professional secrecy.

If Sarkozy’s appeal is unsuccessful, he could serve a year at home with an electronic tag, rather than go to prison.  His wife, supermodel and singer Carla Bruni, is not happy.

Random Musings

--Presidential approval ratings….

In a new AP-NORC Center for Public Affairs Research poll, Joe Biden is enjoying a 60% approval rating for his job performance thus far, 40% disapprove.  57% of independents approve.

70% approve of Biden’s handling of the pandemic, including 44% of Republicans.

48% of Americans believe the country is headed in the right direction, vs. 37% who felt so in December.

Rasmussen: 49% approve of Biden’s job performance, 49% disapprove (March 5), the third straight week at these levels.

--Former Vice President Mike Pence spoke out at length for the first time since the Jan. 6 riots at the Capitol, where some chanted “Hang Mike Pence.”  And in an op-ed for the conservative Daily Signal, Pence detailed his opposition to a voting rights bill spearheaded by House Democrats.  He begins, “After an election marked by significant voting irregularities and numerous instances of officials setting aside state election law, I share the concerns of millions of Americans about the integrity of the 2020 election.”

Oh brother.  How can he write this when it was the disinformation being peddled about the election that jeopardized his own safety and that of his family?  But the GOP is pivoting to a post-election effort to increase voting restrictions.

Republicans, whether they supported Trump’s claims on the vote or not, seem united in their quest to suppress the vote.  Republican state legislators nationwide have been proposing over 200 bills to do such things such as scale back voting by mail – despite no evidence of substantial fraud on that front – with legislation in key states such as Arizona and Georgia working their way through the process, even though in the case of these two, Republican Governors Doug Ducey and Brian Kemp have declined to affirmatively weigh in, as yet.

Georgia Secretary of State Brad Raffensperger tweeted last week that he would support a bill that “prioritizes the security and accessibility of elections” but that many of the bills proposed were “reactionary to a three-month disinformation campaign that could have been prevented.”

--Kathleen Parker / Washington Post

“As we age, several things occur: Death is no longer a curiosity; ‘old’ becomes older and older; and people younger than 50 all seem like teenagers….

“As a factor in employment or public service, age is increasingly confounding.  How old is too old to work or serve when people live into their 90s and beyond?  President Biden, the oldest person ever elected to lead the country, was 78 on Inauguration Day.  The U.S. Senate is so gray it’s beginning to look like a first-class flight to Palm Beach.

“Several of its elder members were on display – and the talk of Twitter – this week as the Senate Judiciary Committee began its investigation of the Jan. 6 attack on the Capitol.  Let’s just say the committee does not lack for maturity.  Leading a ripe field of octogenarians was Sen. Dianne Feinstein (D-Calif.), 87, who has stepped down as the top Democrat on the committee but continues to serve.  Joining her Tuesday in peppering FBI Director Christopher A. Wray with questions he had already answered in his opening statement were vintage Sens. Charles E. Grassley (R-Iowa), 87, and Patrick J. Leahy (D-Vt.), 80.

Sens. Richard C. Shelby (R-Ala.) and James M. Inhofe (R-Okla.) are 86, and Sen. Bernie Sanders (I-Vt.) will turn 80 this year, bringing the number of Senate octogenarians to six….

“Yes, we all know people well into their 80s and beyond who are as active and mentally alert as others much younger.  [Ed. see Warren Buffett and Charlie Munger.] Moreover, we are what we do, and identity isn’t easily surrendered.  For many people, ceasing to work feels like ceasing to be.  A lawyer friend who retired and then became deeply depressed told me: ‘People used to pay me a lot of money for my advice, and now nobody cares what I think about anything.’….

“Once upon a time, it was considered poor form to ask a woman’s age, and women were deemed justified in rebuffing the request.  But when it comes to managing the country’s business, 80-somethings who believe their continued presence in Washington is essential to the country’s well-being may be placing pride before prejudice. The young savants following the judiciary hearings on Twitter were uncharitable toward the veterans.  Time to go, they said.  Retire already.  One tweeted in effect: They know nothing about what this generation needs.

“This may well be true, but also true is that most people don’t think of themselves as old.  Inside every person over 30 is a forever-29-year-old.  Some, such as Grassley and Leahy, aim to prove it.  Grassley runs two miles multiple times a week.  Leahy tests his mettle by scuba diving on his birthday each year, reaching the depth of his age and doing an underwater somersault.

“Well, that’s something.  But what?  Proof that these men are ageless gladiators – or stubborn fools?  Only elections will tell.  Or, better yet, term limits.  Not only would term limits fix most of what ails our political system, they would provide a graceful exit for old soldiers with stories to tell and miles to go before they sleep.”

--A former aide to New York Gov. Andrew Cuomo, Charlotte Bennett, 25, said Cuomo quizzed her about her sex life and asked whether she would be open to a relationship with an older man.  Bennett then rejected Cuomo’s attempted apology, in which he said he’d been trying to be ‘playful’ and that his jokes had been misinterpreted as flirting.

Another former aide, Lindsey Boylan, said Cuomo commented on her appearance inappropriately, kissed her without her consent at the end of a meeting, and once suggested they play strip poker while aboard his state-owned jet.  Cuomo has denied Boylan’s allegations.

Then another woman, Anna Ruch, told the New York Times that Cuomo put his hands on her face and asked if he could kiss her at a September 2019 wedding.  This was after he touched her bare back.  And we had a photo.

Editorial / Washington Post

“Imagine this scenario. The chief executive officer of a company is alone in the office with a much younger woman who works for him.  He asks about her sex life. Has she ever had sex with older men and does age make a difference in romantic relationships?  The woman is unsettled by what she sees as a sexual advance and reports it.  It’s hard to imagine that, in a well-run company, that executive wouldn’t be asked to resign – or be fired on the spot – for his behavior.

“Should the standard be lower for those who hold public office and the public trust?  That is the central question that must be addressed in the developing scandal over allegations that New York Gov. Andrew M. Cuomo sexually harassed two women – Lindsey Boylan and Charlotte Bennett – who used to work for him.  The allegations come as Mr. Cuomo is also under fire over the state’s response to coronavirus cases in nursing homes and whether nursing home deaths were underreported to avoid federal scrutiny.

“After the New York Times detailed Ms. Bennett’s claims – those of Ms. Boylan, which Mr. Cuomo has denied, had been raised earlier – Mr. Cuomo tried to set his own conditions for investigation of the charges by calling in a former federal judge with ties to one of his advisers.  Under mounting pressure, including from Democratic allies, he agreed to refer the matter to New York Attorney General Letitia James.  She said she will hire and deputize an outside law firm and has promised ‘a rigorous and independent investigation.’  It is in the interest of all parties – the two women, Mr. Cuomo and the residents of New York – that the investigation be fair, transparent and timely.

“Even Mr. Cuomo’s version of what occurred between him and Ms. Bennett, a 25-year-old former aide whom he described as a ‘hard-working and valued member’ of his team, raises troubling questions about his judgment and fitness to serve in public office.  He didn’t dispute her account but said he never intended to act in any way that was inappropriate. He said he though he was acting as a mentor and lamented that he often is ‘playful’ and likes to ‘make jokes’ with some staff that may have been ‘misinterpreted as an unwanted flirtation.’  It is astounding that someone in government as long as Mr. Cuomo wouldn’t realize, particularly after the #MeToo movement, the power dynamics of the workplace that make any such talk wrong and not to be tolerated.

“It’s not hard to imagine how Ms. Bennett felt when she thought the 63-year-old governor wanted to sleep with her: ‘Horribly uncomfortable and scared. And was wondering how I was going to get out of it and assumed it was the end of my job.’  After reporting the incident to Mr. Cuomo’s chief of staff, she agreed to a transfer to another job, but eventually quit state government.  Whether the sexual harassment allegations end up costing Mr. Cuomo his job, too, remains to be seen.”

The above was written prior to Cuomo’s remarks Wednesday at the end of his Covid press conference, where the governor apologized for the allegations, saying he “learned an important lesson” about his own behavior around women, but he said he was not resigning.

“I now understand that I acted in a way that made people feel uncomfortable,” Cuomo said.  “It was unintentional and I truly and deeply apologize for it.”

Cuomo said he will “fully cooperate” with the state attorney general’s investigation.  It was his first remarks to reporters since Feb. 22.  They were pathetic.

Separately, according to the New York Times and the Wall Street Journal, the total nursing home death count in New York was stripped from a state report last July.

The report released by the Department of Health last summer had long been criticized for not including the nursing home deaths that occurred in hospitals, leading to a drastic undercounting.

According to the reporting, the Cuomo administration indicated more than 6,200 nursing-home residents had died, instead of nearly 10,000 at the time who were residents of the homes and either died there or at a hospital.

The lower count allowed Gov. Cuomo to more affirmatively tout the state’s response to the pandemic.

In all, about 15,000 deaths (of more than 48,000 New Yorkers) are attributable to nursing homes or other long-term care facilities, which, per capita, is actually slightly lower than the national average compared to overall deaths by state.

Today, two more aides to the governor left their jobs, including press secretary Caitlin Girouard.

And then New York state lawmakers voted to strip Cuomo of some of his emergency powers, granted to the governor amid the pandemic last year.  Under the bill, the governor can no longer impose new executive orders, but can extend current ones beyond the April 30 expiration date as long as he gives notice to the legislature and local elected officials.

--Max Boot / Washington Post

“Is there a more pathetic politician in America than Nikki Haley? She has changed positions on former president Donald Trump so often that she should start sporting flip-flops.

“The former South Carolina governor and UN ambassador was once someone I, and many others [Ed. me included], looked to as the future of the Republican Party. She had a great story as a daughter of Indian immigrants who rose in the good ol’ boy politics of the Republican Party in the South.

“Once in office, she showed guts in responding to the mass murder carried out by a white supremacist at a Black church in Charleston in 2015.  Haley led the charge to remove a giant Confederate flag from the State House, a move the legislature took reluctantly.

“The last time I had any hope for the GOP was in February 2016, when Haley endorsed Sen. Marco Rubio, whose presidential campaign I was then advising on foreign policy. The picture of Haley, Rubio and Sen. Tim Scott – an Indian American, a Cuban American and an African American – campaigning together was a symbol of how the party could embrace the country’s multicultural future.  ‘I will not stop until we fight a man that chooses not to disavow the KKK,’ Haley thundered.  ‘That is not a part of our party. That is not who we want as president.’

“We know how that turned out. Trump won the South Carolina primary, the nomination and the presidency. Every GOP leader in the land, Haley included, bent the knee. Yet Haley somehow managed to keep her distance from Trump even while serving as his UN ambassador. ‘She acquitted herself admirably at the United Nations,’ I wrote after her departure at the end of 2018.

“There is nothing admirable about how Haley has conducted herself since.  Her ambition – she desperately wants to be president – is obvious.  Her principles are not.  Haley was initially supportive of Trump’s attempts to overturn the election results.  ‘Despite what the media tells us,’ she tweeted on Nov. 13, ‘election fraud does happen, and policies like ballot harvesting and mailing ballots to people who don’t request them makes it easier. That needs to stop.’

“In a mid-December interview with Tim Alberta (whose Politico profile of her is a masterpiece of political reporting), Haley twisted herself into rhetorical pretzels to avoid condemning Trump’s assault on our democracy. She suggested his lies about the election were somehow okay because ‘genuinely, to his core, he believes he was wronged.’  She also predicted that he would accept defeat after losing a Supreme Court challenge.  ‘If this case falls through,’ she said, ‘he’s going to go on his way.’

“Instead of going away, Trump incited a violent insurrection.  The day after the Capitol was stormed, Haley showed another flash of courage in denouncing the president at a Republican National Committee meeting.  ‘His actions since Election Day will be judged harshly by history,’ she said. A few days later, she told Alberta: ‘He went down a path he shouldn’t have, and we shouldn’t have followed him.  …We can’t let that ever happen again.’

“Her condemnation of Trump got wide media play, but reading the Politico article more closely, it’s obvious that she only came out against him because she  thought his appeal would wane. She predicted that Trump was ‘going to find himself further and further isolated’ and lose ‘any sort of political viability.’  That hasn’t happened.  Trump proved just as popular with Republicans after Jan. 6 as before it.

“So Haley, the ambitious politician, decided to recalibrate.  On Jan. 25, the day that the House transmitted an article of impeachment to the Senate, Haley went on Fox News and went into full Trump defender mode. ‘They beat him up before he got into office and they’re beating him up after he leaves office,’ she said.  ‘I mean at some point, give the man a break.’  What’s a violent insurrection between friends? Get over it!

“Politico reports that Haley even tried to go to Mar-a-Lago to meet with the Republican idol. He cruelly turned her down. But she continues with her pathetic efforts to ingratiate. On Sunday, Trump rehearsed his old grievances and lies, including the Big Lie about winning the election, in a speech to (CPAC).  Suggesting that she had been listening to a different speech than the rest of us, Haley abjectly tweeted: ‘Strong speech by President Trump about the winning policies of his administration and what the party needs to unite behind moving forward.’

“I feel like a chump for ever thinking that Haley was a politician of principle.  If she believes in anything other than her own ambition, it’s not clear what it is.  Which, in a way, makes her the perfect candidate for a Republican Party that no longer seems to have any principle other than an insatiable lust for power at any price.”

--Thirteen people killed in one of the deadliest border crashes on record were among 44 people who entered the U.S. through a hole cut into Southern California’s border fence with Mexico, the Border Patrol said Wednesday.

Gregory Bovino, the agency’s El Centro sector chief, told the Associated Press that surveillance video showed a Ford Expedition and Chevrolet Suburban drive through the opening early Tuesday. It’s believed they were part of a migrant smuggling operation.

The Suburban carried 19 people, and it caught fire after entering the U.S.  All escaped the vehicle and were taken into custody by Border Patrol agents.

The Expedition crammed with 25 people continued on, and a tractor-trailer struck it a short time later.  Ten of the 13 killed have been identified as Mexican citizens, the others Guatemalans.  The truck driver was among those who survived.

The Border Patrol said its agents were not pursuing the vehicle before the crash. The opening in the fence was about 30 miles east of the crash in the heart of California’s Imperial Valley, farm country.

The fence was made of steel bollards that were built before former President Trump blanketed much of the border with taller barriers that go deeper into the ground.

“Human smugglers have proven time and again they have little regard for human life,” Bovino said.

Seats in the Expedition had been removed except for those for the driver and front passenger, the vehicle built to hold eight people safely.

The crash happened during the height of the harvest in the agricultural region that provides much of the lettuce, onions, broccoli and winter vegetables to U.S. supermarkets.

The area became a major route for illegal border crossings in the late 1990s after heightened enforcement in San Diego pushed migrants to more remote areas.

Illegal crossings in the area fell sharply in the mid-2000s but the area has remained a draw for migrants and was a priority for wall construction under Trump.

--Jury selection begins Monday in the Minneapolis trial of former police officer Derek Chauvin in the death of George Floyd, which has the city on edge.  A new USA TODAY/Ipsos Poll shows that Americans’ trust in the Black Lives Matter movement has fallen and their faith in local law enforcement has risen since protests demanding social justice swept the nation last year.

Last June, a USA TODAY/Ipsos poll had 60% describing Floyd’s death as murder, but that percentage has now dropped to 36%.

Nearly two-thirds of Black Americans, 64%, view Floyd’s death as murder; fewer than one-third of white people, 28%, feel that way.  White Americans are more likely to describe it instead as the police officer’s “negligence,” 33% compared with 16% of Black respondents.

That said, Americans who have heard at least something about Chauvin’s trial say 4 to 1, or 60%-15%, that they hope Chauvin is convicted; that includes 54% of white Americans and 76% of Black Americans.

--Preliminary data from the National Safety Council shows as many as 42,060 people died in motor vehicle crashes last year, including pedestrians, up 8% from 2019.  The increase is confounding roadway-safety experts who hoped reduced driving might create a silver lining during the pandemic.  They believe riskier driving, including speeding on less-packed roadways, was a key reason this benefit never materialized.

--Strategist Ian Bremmer noted the following results from a Pew Research Study that are rather depressing to some of us.

Percentage of Americans who say it’s best for the future of the country to be active in world affairs:

GOP 32%
Democrats 65%
Total 49%

--We note the passing of Vernon Jordan, the esteemed civil rights leader and Washington, D.C. powerbroker who commanded the respect of numerous presidents.  He was 85, no cause of death given but he died peacefully at home.

Former Presidents Barack Obama and Bill Clinton praised their close ally Tuesday, with the latter calling Jordan a good friend “in good times and bad.”

“We worked and played, laughed and cried, won and lost together,” Clinton tweeted.  “We loved him very much and always will.

“Vernon Jordan brought his big brain and strong heart to everything and everybody he touched.  And he made them better,” he and wife Hillary Clinton said in a joint statement.

Former President Obama called Jordan a priceless asset to any leader.

“Like so many others, Michelle and I benefited from Vernon Jordan’s wise counsel and warm friendship – and deeply admired his tireless fight for civil rights,” Obama said.

Jordan grew up in the segregated South and actively worked to end Jim Crow discrimination.  He served as president of the National Urban League and became one of the most visible standard bearers in the post-civil rights struggle for Black economic and political empowerment.

Jordan, who survived a racist assassination attempt in 1980, was undoubtedly best known as a close friend and adviser to former President Clinton.  He helped drive Clinton to an unlikely victory in 1992, in part powered by an overwhelming Black vote for a centrist white governor from the Deep South.

Jordan was one of Clinton’s closest advisers throughout his two terms and caught heat for defending the president during the Monica Lewinsky scandal.

But what most will remember about Vernon Jordan, aside from being a “giant for Civil Rights,” as House Speaker Nancy Pelosi said, is that he was an ‘elegant’ and classy man, who also had personal relationships with Republicans like Ronald Reagan and George W. Bush.

--Dr. Seuss Enterprises said it would stop printing six books because of racist and insensitive imagery, spurred on by a move by the National Education Association to pivot from the popular children’s author to a focus on diverse children’s books, in conjunction with Tuesday’s Read Across America Day.

The annual reading day has been held on or near March 2, which is Dr. Seuss’s birthday.

Until 2019, when its contract ended, the NEA had partnered with Dr. Seuss Enterprises.

A 2019 study from the Conscious Kid’s Library and the University of California-San Diego researchers studied 50 children’s books and more than 2,200 characters created over decades by the children’s author.

What it found: “Of the 2,240 (identified) human characters, there are forty-five characters of color representing 2% of the total number of human characters.”  And of that fraction 43 have Orientalist depictions, and two align with the theme of anti-Blackness, the study found.

“Notably, every character of color is male.  Males of color are only presented in subservient, exotified, or dehumanized roles,” the study authors, Katie Ishizuka and Ramon Stephens, wrote.  “This also remains true in their relation to white characters.  Most startling is the complete invisibility and absence of women and girls of color across Seuss’ entire children’s book collection.”

Of course there was a huge outcry in some circles.  What you need to know is that Seuss classics such as “Green Eggs and Ham,” “The Cat in the Hat,” and “Oh, the Places You’ll Go!” are not impacted, ditto scores of other Seuss books.  He is not being canceled.  They just aren’t printing any more of the six, and you can still find them in libraries, let alone pay $4,000 for one online due to the controversy.

So spare me the outrage.  Plus it’s an opportunity to read other children’s books. 

---

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

Support your healthcare workers and first responders.

God bless America.

---

Gold $1698
Oil $66.28

Returns for the week 3/1-3/5

Dow Jones  +1.8%  [31496]
S&P 500  +0.8%  [3841]
S&P MidCap  +0.7%
Russell 2000  -0.4%
Nasdaq  -2.1%  [12920]

Returns for the period 1/1/21-3/5/21

Dow Jones  +2.9%
S&P 500  +2.3%
S&P MidCap  +8.9%
Russell 2000  +11.0%
Nasdaq  +0.3%

Bulls 59.1
Bears 18.1…still no update in weeks.

Hang in there.  Mask up, wash your hands…don’t screw up now!

Brian Trumbore

 

---