Friday's News Items
16 August 2019. By John Ellis.
1. The idea of the U.S. purchasing Greenland has captured President Trump's imagination. People familiar with Mr. Trump's thinking tell The Wall Street Journal that the president has, with varying degrees of seriousness, repeatedly expressed interest in buying the ice-covered autonomous Danish territory between the North Atlantic and Arctic oceans. Greenland is widely believed to hold excellent potential for a host of natural resources, including zinc, lead, gold, iron ore, heavy and light rare earth elements, copper and oil. Back in 1992, Walter Mead had an even bigger idea.
2. Chinese and Russian warplanes have increasingly nosed around and veered into South Korea’s airspace, conducting close patrols that allow Beijing and Moscow to test the air defenses of the U.S. and its allies in the region. The aerial campaigns come as Beijing vows to strengthen its military alliance with Moscow, heightening tensions across the Asia-Pacific region as the U.S. and China jockey for power there. The Korean Peninsula is once again providing a convenient stage for military provocations, as it did during the Cold War.
3. North Korea fired two more ballistic missiles into its eastern sea -- the sixth such volleys in three weeks -- extending the regime’s most prolific run of tests since U.S. President Donald Trump took office. The weapons, which were likely short-range ballistic missiles, were launched from the Tongchon region in the southeastern province of Kangwon on Friday and traveled 230 kilometers (140 miles), South Korea’s defense ministry said. The test appeared consistent with Kim Jong Un’s push to demonstrate the ability to strike all of South Korea and parts of Japan with new hard-to-intercept missiles.
4. India today hinted that it may be rethinking its doctrine of “No First Use” for nuclear weapons. Defense minister Rajnath Singh tweeted to say the South Asian nation remains “firmly committed” and “has strictly adhered to” the doctrine but “what happens in the future depends on the circumstances.” India is engaged in ongoing tensions with nuclear rival Pakistan over its decision to revoke autonomy of Kashmir region, to which both countries stake a claim. Singh tweeted after visiting India’s nuclear weapons testing site at Pokharan.
5. The leaders of India and Pakistan amplified their rhetoric over the divided region of Kashmir in Independence Day speeches this week, portending higher tensions following Delhi's revocation of the Indian-controlled side's long-held autonomy. In his 92-minute speech here Thursday marking the anniversary of independence from British colonial rule, Indian Prime Minister Narendra Modi made no direct mention of Pakistan, which has denounced Delhi's move on Kashmir. But he justified the decision, saying the autonomy had "aggravated separatism and given birth to terrorism," as well as "strengthened the foundations of corruption." Delhi has long accused Pakistan of promoting terrorism. This followed a warning from Modi's Pakistani counterpart over Kashmir, a flashpoint in relations between the nuclear-armed neighbors. "This is my message to you: you take action and every brick will be countered with a stone," Prime Minister Imran Khan said in a speech Wednesday marking Pakistan's Independence Day.
6. Prime Minister Narendra Modi’s decision to scrap autonomy for Kashmir after imposing an unprecedented lockdown across the region will be tested today at the United Nations Security Council after India’s top court deferred a case calling on the government to lift restrictions that have been in place for the past 12 days. A Supreme Court bench headed by Chief Justice Ranjan Gogoi adjourned a petition challenging the information blackout. Another plea questioning the government’s move to scrap the constitutional provision, as it was taken without the consent of the state’s legislature, was also postponed on grounds of being badly drafted. Both will be taken up at a later date, the court said without giving any details.
7. In dozens of interviews this week, many Kashmiris expressed rage and resentment against Mr. Modi and said those sentiments were growing as curbs continued. Many see the restrictions and massive deployment of security forces as a template for how New Delhi plans to govern Kashmir under the new arrangement. “They want Kashmir, not Kashmiris,” said Manzoor Ahmad Bhat, a 65-year-old retired civil servant who dismissed Mr. Modi’s development promises as a charade. “They have silenced our voices, put us in a cage.”
8. Richard Haass: "(T)he US would be unwise to turn to Pakistan as a strategic partner. Pakistan sees a friendly government in Kabul as vital to its security and competition with arch-rival India. There is little reason to believe that the military and intelligence services, which continue to run Pakistan, will rein in the Taliban or rule out terrorism. Equally, the US would be unwise to alienate India. Yes, India has a tradition of protectionist trade policies and often frustrates US policymakers with its reluctance to cooperate fully on strategic issues. But democratic India, which will soon surpass China as the world’s most populous country and will boast the world’s fifth-largest economy, is a good long-term bet. It is a natural partner to help balance China. India has rejected participation in China’s Belt and Road Initiative, whereas Pakistan, struggling economically, has embraced it."
9. President Trump yesterday said he would speak to his Chinese counterpart Xi Jinping “very soon” as Beijing warned it would retaliate if Washington continued imposing tariffs on Chinese products. Adopting an upbeat tone, Mr. Trump said that this month’s most recent talks between the two nations’ trade negotiators had been “productive”, with Beijing hoping to reach a deal with the United States and vowing to crack down on the flow of the deadly opioid fentanyl from China into the US. “They want to follow through very quickly [on fentanyl],” Trump said.
10. U.S. 30-year Treasury yields yesterday fell to a record low below 2% and benchmark 10-year notes dropped to a three-year trough amid persistent worries about global trade tensions and economic slowdowns around the world. Yields on U.S. two-year notes also declined, sliding to a nearly two-year low. A day after inverting, the U.S. yield curve steepened a little. Curve inversion, which occurs when long-term yields dip below short-term ones, is widely considered a warning that the economy is headed for recession.
11. American shoppers gave the U.S. economy a boost in July, countering manufacturing-sector weakness, while Wall Street continued to have jitters about faltering growth. Retail sales, a measure of purchases at stores, restaurants and online, climbed a seasonally adjusted 0.7% in July from a month earlier, the Commerce Department said Thursday. The robust report—the strongest reading since March—is a positive signal for the U.S. economy, at least for now, amid warning signs of a global slowdown.
12. U.S. industrial output fell in July, as the manufacturing sector continued to struggle with trade-related headwinds. Industrial production, a measure of factory, mining and utility output, declined a seasonally adjusted 0.2% in July from the prior month, the Federal Reserve said Thursday. That fell short of economists’ expectations for a slight increase. June industrial production was revised to an increase of 0.2% from an earlier flat reading.
13. Hardline Tory "remainer" MPs suggested they could favor a Jeremy Corbyn premiership over a no-deal Brexit, boosting the Labour leader’s plan to lead a caretaker government. Mr. Corbyn wrote to other opposition parties and a group of Conservatives this week to say they must install him in No 10 to stop Britain crashing out of the European Union on October 31. Despite scepticism from the Liberal Democrats and hostility from some independents, the Tory MPs addressed by Mr. Corbyn said they welcomed his approach and agreed to meet him.
14. Israel today said it would allow Rep. Rashida Tlaib to enter the country to visit her grandmother in the West Bank, a day after denying entry to her and fellow Democratic Rep. Ilhan Omar for supporting a boycott of Israel. The move partially walks back Israel’s decision Thursday to block Ms. Tlaib, a Palestinian-American representing Detroit, and Ms. Omar, a Somali-American representing Minneapolis, from entering Israel for a visit to Jerusalem and the West Bank that was to begin Sunday. Israel cited their support of the boycott movement and said their itinerary didn’t include any meetings with Israeli officials.
15. An accounting expert who raised red flags about Bernie Madoff ’s Ponzi scheme has a new target: General Electric. In a research report posted online Thursday, Harry Markopolos alleges the struggling conglomerate has masked the depths of its problems, resulting in inaccurate and fraudulent financial filings with regulators. The report, which numbers more than 170 pages, is a mixture of detailed financial analysis and sweeping claims. In an interview, Mr. Markopolos said his group found GE’s insurance unit will need to bolster its reserves by $18.5 billion in cash, and he faulted the way the company is accounting for its oil-and-gas business. All told, he said, the accounting problems amount to $38 billion, or 40% of the conglomerate’s market value.
16. In one of the more remarkable partnerships in modern American political history, Soros and Charles Koch, the more active of the two brothers, are joining to finance a new foreign-policy think tank in Washington. It will promote an approach to the world based on diplomacy and restraint rather than threats, sanctions, and bombing. This is a radical notion in Washington, where every major think tank promotes some variant of neocon militarism or liberal interventionism. Soros and Koch are uniting to revive the fading vision of a peaceable United States.
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