Wednesday Night #1353

If there’s anything going on in the world besides Super Tuesday, it’s hard to discern it in the media, whether U.S. or foreign based. We cannot recollect such intense excitement over primaries and admit to obsessing about the latest pronouncement from Wolf, Brian, Charlie (Gibson or Rose), Tim, not to mention all those wonderful political blogs, about which Kennedy/celebrity has endorsed whom and what this all means. Then there are the analyses from the BBC, the Economist, the Independent, The Guardian — even Al Jazeera carries a story on California voters’ preoccupation with the environment, accompanied by a side bar reminding readers that:
A total of 24 US states are holding primaries or caucuses on 5 Feb MSNbc live TV
It is the day when the largest number of nominating delegates for both Republicans and Democrats are up for grabs – 52 per cent of Democratic delegates and 41 per cent of Republican delegates are at stake.
For your reading pleasure there is much more at: U.S. Primaries: Super Tuesday and U.S. Presidential Campaign: views and reviews
There was, of course, the Super Bowl, which was even a topic for the political junkies who debated whether the Giants’ upset victory was a portend of the New York Senator’s success at the polls? With whom were the respective candidates viewing the game? Did Bill Clinton try to get Bill Richardson’s endorsement during the game? Far less entertaining is the prospect of the record $3.1 trillion Bush budget proposed on Monday, which would produce huge federal deficits, along with politically wrenching curbs on Medicare and eliminate scores of popular domestic programs. Fortunately, ” Bush’s lame-duck budget plan is likely to be ignored by Congress, which is controlled by Democrats and already looking ahead to November elections. His long-term projections are mostly academic since he’s leaving office next January.”
On the international scene, events in Kenya (and of course, there’s an Obama link) have remained among the top stories every day. Tonight there appears to be some glimmer of hope with the announcement that a framework for the establishment of a truth and reconciliation commission to help end the crisis was agreed on Friday. Unfortunately this good news comes just as rebels mounted a major assault on Ndjamena, the capital of Chad . This conflict is also based on tribal issues and could have severe effects on the situation in neighboring Darfur.
For a brief moment, we glimpsed a few items on the presidential vote in Serbia and what it will mean for the independence of Kosovo.
The situation in Afghanistan is increasingly bleak and it does not appear that NATO will come to reinforce the Canadians, British and other allies. See also wednesday-night.com
News of China is not good. The crippling and unusual snow storms have wreaked havoc on the eve of Chinese New Year. Millions remained stranded on Monday ahead of the biggest holiday of the year as parts of the country suffered their coldest winter in a century. Freezing weather has killed scores of people and left travellers stranded before the Lunar New Year, or Spring Festival — the only opportunity many people have to take a holiday all year.
While the Economist reports that
Efforts to cool the economy may undo crucial reforms
“Faced with rising consumer prices and signs of runaway growth, the Chinese Communist Party in November issued a strongly worded statement vowing to stem inflation and slow investment. At the time market players paid scant attention to it. But as the State Council’s increasingly stringent policies show no signs of letting up even in the face of global financial turmoil, players in China’s property and equity markets are at last waking up to the harsher reality. In recent weeks both housing and stock prices have started to retreat from their irrationally exuberant highs. Chinese policymakers, however, should be careful of what they wish for. Falling asset prices could bring back an old problem that many thought had been conquered: bad debts in the banking system. Meanwhile, inflation is reviving throwback elements of state economic planning.” There’s lots more and it’s gloomy.
In the Canadian media, only election news out of Alberta ranks slightly higher than Super Tuesday – and that won’t last more than a few hours. Meantime, Canada has its very own [Bill] Clinton connection in the story that broke in the New York Times last week: An Ex-President, a Mining Deal and a Big Donor “A Canadian financier who traveled to Kazakhstan with Bill Clinton and won a big mining deal later donated millions to Mr. Clinton’s charitable foundation.” There’s more and it’s not pretty.
The AECL-Chalk River story isn’t going away But still, the National Post featured what a Ron Paul (yes, he’s still around) victory in Alaska might mean. And the Financial Post trumpets [Bank of Canada] Carney’s first weeks a snap Last, but by no means least, The Ottawa Journal reports : “Four of Canada’s largest banks have agreed to support the restructuring of $35-billion-worth of asset-backed commercial paper, working with the Pan-Canadian Investors Committee on the plan.
The Bank of Montreal, Canadian Imperial Bank of Commerce, Royal Bank of Canada and Bank of Nova Scotia said they will join National Bank as lenders in a $14-billion margin call funding facility which will serve as a backup line of credit for the bonds that will replace the frozen non-bank ABCP.”
A propos this story, we would like to call your attention to Ron Meisels‘ prescient remark of almost a year ago (Feb 21 2007): “Since 1887, years ending in seven have always had a bad ending starting sometime in August and ending sometime in October, including 1907 – sometimes referred to as the Crash of 07 – and 1987”. Caveat fundamental-ists.
A final note on the economy: we are enthusiastic readers of The Laurel Comment largely because it is intelligible comment on matters about which we claim no expertise. We note with interest today’s timely reference to the U.S. election process and the perceptions of market performance under Democrats: There will continue to be a great deal of talk during the coming year about the outcome a Democratic victory would have on stock markets. Don’t believe the talking heads on the business channels as they are, with few exceptions, reactionary Republicans whose idea of the common good rests with their own pay cheques. Markets have historically outperformed under Democratic administrations.

 

The Report

The U.S. presidential election
Truth should be considered more by the intent than by the content of the spoken or written word. The 2008 elections in the United States are of vital interest to the world, but especially to Canadians because of our close relationship with the U.S. The ghost of John Fitzgerald Kennedy hovers over the selection process for party leaders as the world ponders the message delivered by the candidates and searches for truth and wisdom in the words of each. Canadians, who would logically favour the Republican Party over the Democrats who tend to be protectionist, appear to favour the Democrats this year, four to one (six to one in Quebec). This may, in part, be due to the issues of health care and abortion, addressed only by the candidates for the Democratic Party, as well as the issue of illegal immigrants. The question has not arisen as to whether or not J.F.K.’s political image might have remained untarnished his term or terms of office had he not been assassinated.
Wednesday Night is a microcosm and not being directly involved in the election can debate the merits of the personages in the role they might play as President of the United States.
Barack Obama is seen as intelligent and articulate. He is regarded by some as a worthy successor to Kennedy, his success in office dependent on whom he would appoint to Cabinet. In recognition that great oratory is no measure of management skills, this support is tempered by his relative youth and short experience in office. While there is little debate about his skills as a candidate, he could be either a great or extraordinarily bad president.
On the Republican side John McCain is seen as the ultimate candidate, but not sufficiently right wing by more conservative electors, potentially splitting voters down the middle. None of the Republican candidates for the nomination has addressed such important issues to Americans as illegal immigrants and accessibility to affordable health care, although these issues are bound to be discussed once the candidate of each party has been selected.
It is interesting that the numbers of voters of Democratic Party voters in the primaries have, to this point, been both far larger than in recent contests and overwhelmingly greater than the numbers of Republican Party voters. American youth are said to support Obama. If this trend carries through to the ballot box, he is expected to win both the nomination and the Democrats, the election.
Urban myths inevitably abound at election time. In Canada one such myth claims that Tory times are tough times, the American equivalent being that the stock market dives under the Democrats, both unsubstantiated myths.

The economy
In the same vein, recalling the time when, under the gold standard, the price of gold determined the value of currency, it is claimed by some that the Stock Market indices have, in fact, been falling over time when compared with the rising price of gold. The flaw in this myth has been in using the price of gold as a yardstick of currency value rather than perhaps, of investor insecurity. Had other commodities been used as a yardstick, the results would undoubtedly have been different. However, a weaker economy and increasing inflation in the United States do not make that country fertile ground for rewarding stock market investments. Some Wednesday Nighters, however, point to the potential for medium and long-term gain in investment in real estate in the U.S. following the drastic fallout of the sub-prime crisis there, or in the Yuan in China.

Afghanistan
In Canada, our continuing presence in Afghanistan is becoming an issue that has the potential for triggering a national election in the near future. A split has appeared in the Liberal ranks with Ignatieff, much more flexible than Dion who will be put on the spot in the confidence vote over this issue. Depending on how this plays out will probably determine whether an election will be held in the immediate future or, as is probable, later on this year. The Conservative Party appears to be in a good position to win an election if held in the near future.
The Afghan issue is critical to the West, believed by some to have as an important rationale, the deflection of terrorism from the West. The troop surge by the U.S. is expected to end following the U.S. election in November this year and the poppy harvest in Afghanistan, a major source of funding for the Taliban, has been at a record level. The Taliban are said to have moved into Kabul and taken over. Expatriates are reported to no longer be able to move freely within that city. Considering that, in World War II, it was concluded that it took ten troops to face each guerrilla, the Coalition appears to be grossly understaffed. Reconstruction has been far too slow and questions are raised as to whether the immediate role of the coalition is education and construction, or to defeat the Taliban. The infrastructure rebuilding appears to have been fraught with incompetence and/or government corruption. NATO, conceived as a protector of Europe appears to be divided on the Afghanistan war, with many countries either opting out or not prepared to place their troops at risk. The role of NATO must be re-examined and clarified and NATO should accept a greater commitment in Afghanistan in both number of troops and role. More recent news on this topic

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