Thursday, March 17, 2016

Thursday, March 17, Night Wall Street Roundup: Dow closes positive for year as commodities rally, dollar dives


March 17, 2016

Wall St moved higher on Thursday, pushing the Dow Jones industrial average into positive territory for the year, as commodity prices rose on the back of a weaker U.S. dollar to boost shares in the energy and materials sectors.

The Dow's move into positive territory came a day after the U.S. Federal Reserve took a dovish stance that weighed on the dollar.

"It was a weak dollar rally," said John Augustine, chief investment officer at Huntington National Bank. "It took up groups associated with a weaker dollar."

The top performing sectors in the S&P 500 were materials, industrials and energy.

The rally was a "continued reaction from the Fed's move," said David Lefkowitz, senior equities analyst at UBS Americas Wealth Management in New York.

The Fed on Wednesday pointed to moderate U.S. economic growth and strong job gains but cautioned about risks from an uncertain global economy.

The central bank pointed to the possibility of two more rate hikes before the end of the year, having laid out four hikes in 2016 when it raised rates in December.

The Dow and S&P were at their highest since Dec. 31 and the Nasdaq hit its highest since Jan. 7.

For the blue-chip Dow, which includes stocks like GE and Goldman Sachs, the past five weeks' rally has now clawed back the deep losses that kicked off the year.

Investors' fears that the U.S. economy could be headed for another recession have faded into the background at least temporarily.

"It's a pretty equity-friendly backdrop," Lefkowitz said.

The Dow Jones industrial average .DJI closed up 155.73 points, or 0.9 percent, at 17,481.49. The S&P 500 .SPX gained 13.37 points, or 0.66 percent, to 2,040.59 and the Nasdaq Composite .IXIC added 11.02 points, or 0.23 percent, to 4,774.99.

U.S. crude CLc1 settled up 4.5 percent at $40.20 a barrel on optimism that major producers will strike an output freeze deal next month amid rising crude exports and gasoline demand in the United States..

Healthcare .SPXHC was the only decliner among the 10 major S&P 500 sectors. It fell 1.05 percent, dragged down by Eli Lilly's (LLY.N) 4.7-percent fall.

Industrials .SPLRCI gained 2 percent, propped up by General Electric's (GE.N) 2.6-percent rise to $30.96. The stock gave the biggest boost to the S&P 500.

FedEx (FDX.N) rose 11.8 percent at $161.34 after the package delivery company forecast better-than-expected full-year earnings.

Endo International (ENDP.O) dropped 12.5 percent at $29.68, after the drugmaker forecast first-quarter results below estimates.

About 8.2 billion shares changed hands on U.S. exchanges, above the 8.02 billion average over the last 20 sessions.

Advancing issues outnumbered declining ones on the NYSE by 2,473 to 595, for a 4.16-to-1 ratio on the upside; on the Nasdaq, 1,927 issues rose and 872 fell for a 2.21-to-1 ratio favoring advancers.

The S&P 500 posted 61 new 52-week highs and 6 new lows; the Nasdaq recorded 73 new highs and 74 new lows.

Article Link to Reuters:

House Speaker Ryan says contested Republican convention more likely


March 17, 2016

House Speaker Paul Ryan said on Thursday it is increasingly likely that the Republican Party's presidential nominating convention will be a contested one this summer.

If no candidate can assemble 1,237 Republican delegates by July, the party's presidential nominee for the November election will be chosen by convention delegates in Cleveland, Ohio, in what could be four days of political drama, carried live on national television.

Republican front-runner Donald Trump warned on Wednesday of "riots" if he is denied the party's presidential nomination, after he scored big wins in primaries in Florida, Illinois and North Carolina on Tuesday. It is uncertain whether Trump can get the 1,237 convention delegates he needs before July.

Ryan denounced Trump's "riots" comment, saying it was unacceptable to even hint at violence. He said he had to study up on the convention process, since he would be chairing the event and wanted to be sure the rule of law prevails.

"Nothing has changed other than the perception that this is more likely to become an open convention than we thought before. So, we're getting our minds around the idea that this could very well become a reality," Ryan said.

As chairman, Ryan will be charged with opening and closing the event, and overseeing the presidential nomination roll call - possibly more than one, if the first is not decisive. He would also be expected to deal with any floor fights on controversial motions that arise.

"I will have to obviously bone up on all the rules and all of those things," Ryan told reporters.

"My goal is ... to be neutral and dispassionate, and to make sure that the rule of law prevails, and to make sure that the delegates make their decision however the rules require them to do that," he said.

The last time delegates arrived at a Republican convention without a clear nominee, in Kansas City in 1976, then-President Gerald Ford edged out challenger Ronald Reagan on the first ballot.

The last time it took multiple ballots to get a Republican nominee was in 1948, when Thomas Dewey was nominated.

Ryan has been touted as a possible dark-horse candidate for president this year, but the speaker repeated Thursday that he is not running.

He said he told former House Speaker John Boehner, who had suggested Ryan be a candidate in case of a deadlocked convention, to "knock it off."

Article Link Reuters:

Frigid Pluto is home to more diverse terrain than expected

By Irene Klotz
March 17, 2016

The most detailed look at Pluto's surface to date has revealed an unexpected range of mountains, glacial flows, smooth plains and other landscapes, according to studies released on Thursday.

The unprecedented window into the so-called dwarf planet, which orbits the sun like other planets but is smaller, comes via high-resolution photographs from NASA’s New Horizons spacecraft. The interplanetary space probe made the first-ever visit to Pluto and its five moons last July.

Those images, chemical analyses and other data show a complex, geologically active world 3 billion miles from Earth, with an underground ocean and volcanoes that appear to spew ice, five research papers published in this week’s Science journal said.

“It’s a pretty wild place geologically,” said planetary scientist William McKinnon of Washington University in St. Louis, Missouri.

Another scientist described the diversity of landscapes as "astonishing."

How the varied terrain came to be remains a mystery for the distant Pluto, which has an average surface temperature of minus 380 degrees Fahrenheit (minus 229 degrees Celsius).

Scientists suspect several processes at work, including vaporization of volatile ices, such as nitrogen, carbon monoxide and methane, into Pluto’s cold and unexpectedly compact atmosphere.

Though smaller than Earth's moon, Pluto likely still has enough internal heat from its formation some 4.5 billion years ago to help maintain its most prominent feature, a smooth, 620-mile (1,000-km) wide, heart-shaped basin known as Sputnik Planum.

Relatively young mountains west of Sputnik Planum and mounds to the south are harder to explain. Scientists suspect both rest on blocks of water ice, though how that came to exist on Pluto is unknown.

“We are puzzled by almost everything,” said Alan Stern, the New Horizons mission's lead scientist.

The studies show that Pluto’s primary moon, Charon, had an active life but ran out of naturally occurring radioactive heat in its rocks and froze through about 2 billion years ago.

Scientists now believe Charon and Pluto’s four other small moons owe their existence to a crash between Pluto and another Pluto-sized body early in the solar system’s history.

Similar to Earth’s moon, scientists suspect Pluto’s natural satellites were formed from the debris that was hurled into space after the crash.

Article Link to Reuters:

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There Aren't Enough White Voters For GOP Win

Trump talks about reaching Hispanics and African Americans, but he’d be the most unpopular candidate with either group ever to lead a national ticket.

By Stuart Stevens
The Daily Beast
March 17, 2016

With every cycle, American politics is covered more like sports.

There are channels and programs that have elevated once obscure insider moments like the NFL combine or the living rooms of the Iowa caucus into national obsessions. Everyone is an expert because every one watches the game played on television. Everyone blogs, everyone calls into Mad Dog or Rush, everyone knows everything. No one knows anything.

But everyone is an expert. Information is consumed to confirm rather than inform opinions and in the internet’s endless feedback loop of misinformation, every hunch quickly escalates into an opinion hardened into a Truth. If only Seattle had run against New England, they would have won the Super Bowl. And in politics, for many Republicans the most unassailable Truth is that winning the presidency is easy if only… .and here everyone finishes the sentence with their pet theory of electoral politics.

That there is so much conviction that it might be easy for Republicans to win a national election is an odd one given history. Over the last six presidential elections, Democrats have won 16 states every time for a total of 242 electoral votes out of the 270 needed to win. In those same six elections, Republican presidential candidates carried 13 states for 103 electoral votes. Here’s another way to look at it: the last time a Republican presidential candidate won with enough votes to be declared the winner on election night was 1988. 

In 1980, Ronald Reagan won 56 percent of white voters and won a landslide victory of 44 states. In 2012, Mitt Romney won 59 percent of whites and lost with 24 states. But it’s a frequent talking point that white voter enthusiasm was higher for Reagan and turnout down for Romney. Not so. In 1980, 59 percent of whites voted and in 2012, 64 percent of whites voted.

But still the myth survives that there are these masses of untapped white voters just waiting for the right candidate. Call it the Lost Tribes of the Amazon theory: If only you paddle far enough up the river and bang the drum loud enough, these previously hidden voters will gather to the river’s edge. The simple truth is that in there simply aren’t enough white voters in the America of 2016 to win a national election without also getting a substantial share of the non-white vote. Romney won 17 percent of the non-white vote. Depending on white voter turnout, a Republican needs between 25 percent and 35 percent of the non-white vote to win. RealClearPolitics has a handy tool so you can play with the percentages:

The Trump campaign talks about being able to reach out to Hispanics and African Americans but it’s not an overstatement to say he would be the most unpopular candidate with either group to ever lead a national ticket. Only 12 percent of Hispanics have a favorable view of Trump with 77 percent unfavorable. Even among Hispanic Republicans, he has a 60 percent unfavorable. Among African Americans, Trump has an 86 percent unfavorable.

To have even a chance at winning a national election, a nominee must get ninety-plus percent of their own party. But one out of every three Republicans view Trump unfavorably.

A function of a contested primary? Not really. Hillary Clinton has an 83 percent favorability with Democrats in the middle of her very hot battle with Bernie Sanders.

One of Hillary Clinton’s greatest weaknesses is her perceived lack of honesty and trust. Only 37 percent of Americans believer she is honest and trustworthy. That could be a devastating opportunity for an opponent to exploit. But only 27 percent of the public believes Donald Trump is honest.

We can go on. But of course none of this will dissuade the Trump believers who will point to his dismantling of the Republican field as proof that he is a new force in politics and to use that popular phrase I loathe, “there are no rules.” It’s a legitimate point and one impossible to argue as there is no alternative universe in which there was an alternative election in which the Republican candidates ran better campaigns against Trump.

It’s true that voter registration and turnout is up in the Republican primaries and I don’t see any reason not to credit Trump with those increases. We’ve seen this before with little impact on the general election but more voters and more voter enthusiasm are positive.

Trump has accumulated about half of the 1237 delegates he needs to secure the nomination and there are credible scenarios where he does not become the nominee. (That’s another piece.) In my view, Donald Trump, if he does claim the party’s mantle, would be a historically weak and vulnerable nominee.

But let’s not kid ourselves. Even if John Kasich or Ted Cruz, the remaining two candidates, were to emerge, the advantage is still very much with the Democrats. And until the party grows its appeal with non-white voters, it’s going to take an inside straight to win the White House.

Article Link to the Daily Beast:

Iran Is a Jekyll-and-Hyde Problem

By Marc Champion
The Bloomberg View
March 17, 2016

It doesn't take long in Iran before you start looking at the country through a Dr. Jekyll and Mr. Hyde prism: How to get rid of the monstrous Hyde without also harming the well-intentioned Jekyll, when they share the same body.

The Hyde part of this analogy seems clear: it's Iran's clerical regime. It retains power by dictating who can stand for election, repressing and censoring political and cultural opposition and executing about 1,000 people per year. Abroad, it arms terrorist groups and tests ballistic missiles emblazoned with the words "Israel must be wiped out."

The Jekyll side is less understood. This is the Iran where an American is more likely to get an enthusiastic reception than in any other country I've visited in the Middle East; as far back as 2002, survey data suggested that three quarters of Iranians wanted closer relations with the U.S. Iranians are better educated than citizens of other countries in the region and women make up 60 percent of the university student body (enough for the regime to try to start excluding them from certain courses). The economy, though far too oil dependent, is more diversified than others in the Persian Gulf. Above all, Iran is a stable nation state with thousands of years of history in a region of shifting sands.

As sanctions lift under the nuclear deal signed in January, the trick is to make sure that any unfrozen assets and investments that pour into the country strengthen "clean" private-sector companies, and starve those with links to the Iranian Revolutionary Guard Corps. Economic success should lift moderate politicians such as President Hassan Rouhani, and help them to bring Guard-owned companies into the tax system and generally undermine hardline opponents. The hope is that over time -- say by the time the time restrictions on Iran's nuclear fuel program expire in 15 years -- the regime will be changed by the country's opening up to human contact and financing from the outside world.

I tested this idea on two men with contradictory views on how the West, and more particularly the U.S., should deal with Iran.

Ali Kedery was the longest-serving senior U.S. official in Iraq from 2003 to 2009, after which he went to work for ExxonMobil. From there went on to set up Dragoman Partners, a consultancy based in Dubai, where we met. His experience in Iraq, where Iran supplied roadside bombs to kill U.S. soldiers and organized Shiite militias that terrorized Sunnis, left him with a deeply unsentimental -- and hostile -- view of his near neighbor:

You cannot separate Dr. Jekyll from Mr. Hyde. President Obama and his very inexperienced and ideological team have bet the farm on their ability to separate the regime from the Iranian people. But you are dealing with a real regime, one that has deep roots planted since 1979.

Kedery went on to describe the regime's vice-like grip on political power -- proved by its crushing of pro-democracy protests in 2009 -- and over Iran's economy. As a result, he said, the idea that hardliners will allow Western capital and interaction penetrate the country to such an extent that it can erode their power and change the nature of the regime is dangerously wrong:

They are not stupid. The model they have adopted is something like Russia's or China's. There will be a lot of foreign direct investment, but they will make sure it is directed towards the government.

Kedery's understanding of Iran (he says he can't visit the country because "it would be a one way ticket") leads to several conclusions. First, that the nuclear deal with Iran was a mistake; in 15 years the same regime with the same goals will be able to develop an industrial-scale nuclear fuel program, making it a threshold nuclear state by right. Second, having made that mistake, the U.S. should apply as much pressure as possible on Iran and its economy, using residual sanctions to constrain both U.S. and European business with Iran. Above all, it should contain the IRGC:

There is a storm gathering in the region. I think we're in a 1913/1938 moment, because appeasement -- as [then British Prime Minister Neville] Chamberlain learned -- doesn't work when you have a regime with violent, expeditionary instincts baked into its DNA.

For the alternate view, I spoke in Tehran with Saeed Laylaz, a former economic adviser to Iran's former, reformist President Mohammad Khatami. To start with, says Laylaz, while "the U.S. is the only country that has the power to affect domestic politics in Iran," it can do so in only one direction. That's because U.S. interference -- any attempt to pressure on Iran in any way -- simply creates more leverage for the country's radical conservatives:

Radicals in Iran love it. If you sent ballot boxes to Iran in November, all of the radicals would vote for Donald Trump, not Clinton.

Laylaz gave an example of how this works. After the terrorist attacks on New York and Washington on Sept. 11, 2001, he recalled, Supreme Leader Ayatollah Ali Khamenei offered Iranian airspace and cooperation to help the U.S. fight the Taliban and al-Qaeda in Afghanistan. Not long afterwards, U.S. President George W. Bush called Iran part of an "Axis of Evil." Then he invaded Iraq, bringing U.S. troops to Iran's border:

What was the message? Please be as strong as possible, or we will destroy you. They forced Khamenei to go kick out Khatami.

Eight years of hardline rule and expansion of the Revolutionary Guard's control of the economy followed, under Khatami's replacement, Mahmoud Ahmadinejad . Far from being naively ideological, Laylaz believes U.S. President Barack Obama has shown political courage by upending U.S. policy towards Iran, which for 70 years -- from engineering a coup in 1953, to today -- has been based on trying to force compliance on governments in Tehran.

"Pressure will help the regime," said Laylaz. "If the U.S. would leave us alone, we can solve our problem with the conservatives." He sees Rouhani's recent success in parliamentary elections as evidence to support the country's ability to change.

Sure, there are no guarantees, says Laylaz. But the U.S. has been trying for more than 35 years to contain Iran -- from funding Iran's invasion by Iraq in 1980, a war that cost hundreds of thousands of lives, to imposing economic sanctions over Iran's support of terrorism and its nuclear fuel program. The policy has failed. The regime in Tehran remains as much in control, as conservative and as anti-American as ever. With the nuclear deal implemented, why not at least give the other approach an honest try?

These are both powerful cases. It isn't obvious which will prove correct. In Robert Louis Stevenson's novella, Jekyll eventually killed himself, because he could no longer prevent his transformations into the monster. There was no way to divide his body and dispense with only Hyde. Everyone should hope Iran's future proves otherwise.

Article Link to the Bloomberg View:

Twilight of the Neoconservatives

The Sunshine State shut the lights out on the neocons' favorite son.

By Matt Purple
March 16, 2016
The National Interest

There you have it. After months of Marco Rubio’s presidential campaign focusing inordinate amounts of money and attention on Florida, fueled by spokesman Alex Conant’s optimistic Sunshine State forecasts and punctuated by the candidate’s specious insistence that this was a bellwether for the Republican nomination, the butterfly ballots have at last been counted. The state’s ruthless primary mechanism—to the victor go the spoils, with nothing for second place—swept all ninety-nine of its delegates to Donald Trump. On the Ides of March, Floridians gave their native son a hard frontal stab. Out of sixty-seven counties, Rubio won only his home, Miami-Dade.

Last night was Insuperable Tuesday for Rubio as he took a beating across the electoral map. He placed fourth in every contest except his home state. In Ohio, he won less than 3 percent of the vote. But it was Florida where Rubio hung his hopes, and when he lost there, he emerged to a podium that appeared to be located in his garage to suspend his campaign. As the feeble lighting shaded his face with some rare five o’clock shadow, he lamented that this wasn’t “the year for a hopeful and optimistic message about our future.”

“I ask the American people, do not give into the fear. Do not give into the frustration,” Rubio said. Elsewhere in Florida, the maestro of those emotions was preparing to give his victory address, where he would accuse those who’d lowballed his vote totals of not understanding “basic physics.” Trump had shaken up the race once again. He won every state last night except Ohio and possibly Missouri, where he and Cruz are still deadlocked.

There will be plenty to learn from the Rubio autopsy, which the media is already conducting with its usual splattering indelicacy. The most interesting takeaway is that the Republican race has lost its only neoconservative. Rubio wanted to tear up the nuclear deal with Iran, hike defense spending by $1 trillion over the next decade and brush aside privacy concerns that have been raised over the NSA’s metadata collection. Now, the candidate whose appropriation of neoconservative scenery was so thorough that his campaign slogan was literally the name of a pro-Iraq War group sans two words is gone. For the intellectual school that sculpted GOP policy throughout much of the 2000s, it’s a dramatic tumble from influence.

Neoconservatives initially liked their chances in this election. Back when Rand Paul was petering out, hawkish commentators declared that the GOP flirtation with libertarianism was over, and that Republican voters, fuming over the barbarism of the Islamic State, were ready for a return to the “foreign policy of Ronald Reagan,” by which they meant the foreign policy of Woodrow Wilson. Now they’re faced with a presidential field that’s manifestly less interventionist than they are. The most hawkish candidate still standing, Senator Ted Cruz, is also one of the most dovish Republicans in the Senate, having opposed arms for the Syrian rebels and stood with Rand Paul on issues of surveillance. John Kasich, the military budget watchdog, thinks we need to stay out of Middle Eastern civil wars. And Donald Trump has repudiated George W. Bush’s foreign policy in the most full-throated terms imaginable.

That’s not to say the Republican Party is skidding back in time towards Hiram Johnson. Just last week, Kasich pledged to establish a no-fly zone in Syria and if necessary shoot down Russian planes (too late!). But this is still the least hawkish Republican presidential field since 9/11. The conservative base’s reaction to ISIS—go to war sparingly, but make the sand glow when you do—was far more cold-eyed than the neocons anticipated.

As for the rest of the race, Ted Cruz once again finds himself in a pickle. The Texas senator has been trying to winnow the field to himself and Donald Trump, and even went so far as to spend money in Florida, a state he had no chance of winning, in the hopes of hastening Rubio’s exit. Now Rubio has finally departed and Cruz finds himself back where he started: in a three-way race caught between Trump and an establishment-flavored candidate. John Kasich won sixty-six delegates in Ohio, which could gas his campaign for another month to come. For those hell-bent on sinking Trump, Cleveland is starting to look very attractive.

Article Link to the National Interest:

Denmark the happiest country in the world

Want to be happy? Move to Denmark, not Burundi.

Politico EU
March 16, 2016

For the third time in four years, Denmark topped a survey ranking the happiest countries in the world.

The World Happiness Report 2016, published by the Sustainable Development Solutions Network and the Earth Institute at Columbia University on Wednesday, ranks 156 countries in terms of happiness levels using factors such as gross domestic product per head of population and life expectancy.

The Top-Ten:

1. Denmark
2. Switzerland
3. Iceland
4. Norway
5. Finland
6. Canada
7. The Netherlands
8. New Zealand
9. Australia
10. Sweden

The top 10 is the same as in 2015, although the order has changed.

The U.S. came in at 13, the U.K. at 23, France at 32 and Italy at 50.

The least happy places to live are Syria, Afghanistan and eight sub-Saharan countries. One of those, Burundi, is ranked the world’s least happy place to live.

The report urges nations to combat inequality and to protect the environment. “Many countries in recent years have achieved economic growth at the cost of sharply rising inequality, entrenched social exclusion, and grave damage to the natural environment.” it said.

Article Link to Politico EU:

Was Harvard Law School’s Shield Racist Enough To Change?

Harvard Law School has retired its official symbol, because of its ties to a slave-owning benefactor.

By Lizzie Crocker
The Daily Beast
March 16, 2016

Harvard Law School is acting swiftly in the wake of its decision Monday to retire the school’s official symbol, adopted in 1936, because of its ties to a slave-owning benefactor.

By Tuesday, the school had already excised it from Facebook and other social media platforms, and has promised to remove all physical traces of the racially charged family crest—on plaques, chairs, doormats, letterhead—by mid-April.

On Monday, Harvard Corporation approved the decision made by a committee of nine people, including HLS professors, students, and alumni, which they justified in an 11-page report.

Though the issue was first raised by the Royall Must Fall student movement (inspired by the Rhodes Must Fall movement at Oxford University), the committee suggested that they were not simply kowtowing to the “strong feelings” represented by those behind the movement, or those in favor of retaining the symbol.

The committee “cannot and should not presume to judge which feelings are valid and which are not,” they wrote, so they arrived at their decision in “a reasoned and principled manner” that involved canvassing more than 1,000 people—faculty, staff, students, and alumni—in the greater Law School community, but offered no poll or vote.

The subtext is that Harvard Law School is not in the business of protecting feelings, and that the decision to do away with the school’s trademark symbol—the family crest of a wealthy slave owner whose son, Isaac Royall Jr., endowed Harvard’s first law professorship—was based on careful consideration of a number of issues.

But their lawyerly justifications for doing away with the symbol did, in fact, boil down to respecting the feelings of those for whom the shield represents “past oppressions and present discriminations.”

They are not wrong to wish to appease current students who aren’t proud of the Law School’s official and ubiquitous symbol, now that they know of its ties to slavery.

Indeed, the Law School has been aware of the Royall family’s links to slavery since 2000, when Professor Daniel Coquillette began publishing research on the subject. (He has since co-written a book, On the Battlefield of Merit: Harvard Law School, The First Century, about the school’s morally tainted beginnings.)

But it wasn’t until last fall that current law students mounted a campaign to do away with the Royall family crest as the Law School’s official symbol, echoing recent protests challenging traditions and legacies at universities on both sides of the Atlantic.

Yale has rushed to meet student demands to “abolish the title ‘master’” for faculty members, among other things. Brown has launched a $100 million “inclusivity” initiative in response to student protests.

Princeton’s President Christopher Eisgruber signed a document vowing to consider removing Woodrow Wilson’s name from the university because he advocated for segregation during his presidency.

Since October, students at Oxford’s Oriel College have been campaigning to dismantle a statue of Cecil Rhodes, the British colonialist who endowed the Rhodes scholarship. (They successfully campaigned for the removal of a plaque honoring Rhodes at Oriel College.)

And students at Cambridge University’s Jesus College are demanding the school return a brass rooster to southern Nigeria, where it was stolen by British soldiers during a peacemaking mission gone wrong in the late 19th century. It was bequeathed to the school in 1930 by an army captain whose son attended Jesus (its founder’s family crest featured roosters).

The Committee report stated that while its members disagreed at some stages of decision-making, they were largely in agreement about retiring the fraught Royall symbol.

“It was very important that the committee showed a substantial will to deepen our engagement with the Isaac Royall legacy and contemporary issues of racial justice,” Janet Halley, the Royall Professor of Law, told The Daily Beast.

Halley stressed that while the symbol will be expunged, the Royall family legacy will not.

Others suggested that removing the sign amounts to a piecemeal attempt to change the culture where white privilege is the dominant theme—and one which is not likely to constitute social change.

“It will be nice when gratitude replaces grievance as the ruling passion of the university,” said Ruth Wisse, a longtime undergraduate professor at Harvard who retired in 2014.

Though the committee addressed “slippery slope” arguments—once you start righting wrongs, where do you stop?—some professors were not convinced.

“My preference would have been for Harvard to articulate standards that would be genuinely applicable to situations of this kind rather than to focus exclusively on this one issue,” said Alan Dershowitz, professor emeritus at the Law School.

“We don’t know what [retiring the symbol] will mean in terms of buildings and institutions that are named after other wrongdoers whose presence offends other minority groups.”

Article Link to the Daily Beast:

America's Exorbitant U.K. Hypocrisy

By Clive Crook
The Bloomberg View
March 17, 2016

Boris Johnson, mayor of London and a leading figure in the campaign to get Britain out of the European Union, recently launched a pre-emptive strike against an expected U.S. intervention. President Barack Obama is apparently planning to drop by between now and the referendum in June, to help Prime Minister David Cameron and his government by saying, not for the first time, that the U.K. shouldn't leave.

Johnson writes:

"The American view is very clear. Whether in code or en clair, the President will tell us all that U.K. membership of the EU is right for Britain, right for Europe, and right for America. And why? Because that -- or so we will be told -- is the only way we can have “influence” in the counsels of the nations.

It is an important argument, and deserves to be taken seriously. I also think it is wholly fallacious -– and coming from Uncle Sam, it is a piece of outrageous and exorbitant hypocrisy."
He has a point about hypocrisy. Remaining a member of the EU involves a substantial, and in all likelihood increasing, surrender of sovereignty to EU institutions -- its parliament, executive and supreme court. It's inconceivable that Obama or any U.S. president would even consider such an arrangement for America. Johnson isn't exaggerating when he says that the U.S. defends its own sovereignty with "hysterical vigilance." Yet Americans typically see British concerns about sovereignty as quaint and beside the point.

Even for a middle-sized country such as Britain -- even for countries a lot smaller than that -- sovereignty isn't a myth or illusion. Economic and geopolitical realities constrain choices, and the smaller and poorer the country, the tighter the constraints. But people can still ask, where do those choices, constrained as they may be, reside? Who is making them? It isn't meaningless to say that Costa Rica has a larger measure of self-government than Kansas.

Putting Britain's preoccupation with self-government to one side, a quite different question is worth considering. Is Obama right about where American interests lie in all this? Does Britain's membership of the EU make it a more valuable American ally?

That's harder to say. In international affairs, Britain is usually aligned more closely with American rather than with European ways of thinking -- not just on sovereignty, but also on American leadership, the need for strong national defense, and the use of force in pursuit of global security. At the moment, the view from Washington might be that the U.K. can serve U.S. interests two ways, first as an ally in its own right, and second as a spokesman for the American worldview within the EU. Why would America want to see that second role inhibited or ended by Brexit?

In the short term that looks correct: For the moment, Britain in the EU gives the U.S. the best of both worlds. But with time Britain's obligations to the EU are likely to change. It may never merge into the United States of Europe that some still envisage (Cameron just secured an opt-out from the treaty commitment to "ever closer union") but closer cooperation out of choice or necessity seems probable, including in foreign affairs. Britain's pro-American sentiments will presumably persist but its ability to act as an independent ally might not. With or without full political union, the EU could inhibit the U.K.'s ability to act alongside the U.S.

The question would then be, which is more valuable to America -- a fairly reliable medium-sized military ally, or an EU slightly more inclined, thanks to British influence, to see things the way America does?

The balance could fall either way. A lot depends on how influential in Europe you think the Brits might be, supposing they could put their minds to the task of persuasion and stopped being perpetually at odds with their EU partners. I'm not optimistic on this score. The European project is guided in part by the desire to push back against American power, so resistance to British entreaties on this will be strong. Also, I doubt the Brits will ever settle happily into Europe's ever closer union, or that the EU will ever stop resenting and resisting Britain's demands.

I've reluctantly concluded that, despite the cost in diminished sovereignty, the U.K. should stay in the union. This isn't because the British will ever stop grumbling or feel they belong, but because the alternative to staying in would be a ruinously expensive divorce, and that would be worse. Where U.S. interests lie in this choice is harder to judge, but Johnson's right about one thing: Obama might at least pay the Brits the courtesy of understanding their distinctively American ideas about sovereignty.

Article Link to the Bloomberg View:

Osama bin Laden’s ‘Bookshelf’ Reveals al Qaeda’s Long Game

Captured documents released by the U.S. reveal the extent of al Qaeda’s strategy, which may include negotiated ‘truces’ in Syria and elsewhere.

By Daveed Gartenstein-Ross
The Daily Beast
March 17, 2016

When 113 new documents recovered in 2011 during the fatal raid on Osama bin Laden’s compound in Abbottabad, Pakistan, became publicly available earlier this month, perhaps the most noteworthy insight they offered was the extent of the strategic patience, to borrow a phrase from the Obama administration, possessed by al Qaeda.

Along with other captured documents, what the U.S. Director of National Intelligence calls “Bin Laden’s Bookshelf” reveals the cunning long-term planning that characterized the group’s approach at the time of bin Laden’s death, and that continues to guide it today, affecting not least the actions of its affiliate the al Nusra Front in Syria.

The record shows that the United States often has overlooked the extent of al Qaeda’s patient approach, sometimes mistaking its relative quiet for inactivity or collapse, and our failure to understand the group has helped it to gain critical operating space, and even worse, has sometimes caused us to blunder into its traps.

The broad outlines of al Qaeda’s strategy of attrition against the West are, at this point, generally well understood. Al Qaeda’s strategy, as initially formulated by bin Laden, was to wear down the United States militarily, politically, and economically.

This long-term approach contrasts with that of al Qaeda’s louder jihadist spin-off and competitor, the so-called Islamic State (ISIS), which already claims to have reestablished the caliphate. Al Qaeda, on the other hand, sees the United States as the “trunk of the tree,” as bin Laden put it in a letter addressed to the late al Qaeda in the Arabian Peninsula (AQAP) emir Nasir al-Wuhayshi. Al Qaeda wanted to wait to sever that tree trunk before moving on to the next stages in its campaign, including building an Islamic state, according to that captured document which was declassified in 2012.

The newly released Abbottabad documents show how strategic patience has shaped al Qaeda’s military operations and political activities. The jihadist group has proven willing to make compromises, sacrifice short-term victories, and even develop tactical alliances with adversaries in order to outlast its various foes. At the same time, the group looked for rear bases of support and safe havens where members could train, plan attacks, and prepare for future battles in the region.

Al Qaeda’s approach to the Mauritanian government illustrates this restraint and flexibility. In several newly declassified documents dating from about 2010, al Qaeda officials discussed the possibility of making a truce with Mauritania, in which al Qaeda in the Islamic Maghreb would refrain from military operations in the country.

What was in it for al Qaeda? The group discussed some demands that it had for Mauritania: the government would allow militants to operate freely in the country, release incarcerated al Qaeda members, and provide al Qaeda 10 to 20 million euros a year, protection money to ensure that al Qaeda didn’t kidnap tourists.

From al Qaeda’s perspective, the rationale for the deal was that it would allow militants to “focus on Algeria,” while placing its “cadres in safe rear bases available in Mauritania,” as now-deceased Ahmed Abdi Godane, emir of the Qaeda affiliated Somali al Shabaab, noted in a letter written in March 2010. It is not clear from the documents whether this offer was actually extended to Mauritania, nor what response al Qaeda received if the offer was made, but al Qaeda’s consideration of this approach attests to the group’s patience, and willingness to grant foes a temporary reprieve if there was an advantage to doing so.

The logic that influenced al Qaeda’s thinking on Mauritania could also be seen in Yemen. An al Qaeda strategy paper noted that the jihadist movement was thriving under the country’s then-president, Ali Abdullah Saleh, whose corruption had created “fertile ground” for jihadism. The author of the paper concluded that the best immediate option for al Qaeda was to allow Saleh to remain in power, rather than working to topple him.

Why was the author so suspicious of “ousting the apostate government and keeping the country in a state of chaos”? After all, chaos typically plays to the advantage of jihadists. The author reasoned that Saleh’s replacement likely would be more aggressive in targeting jihadists. Moreover, even if chaos prevailed, he noted that “we cannot spread our Dawah while there is chaos.” Dawah refers to proselytism: In other words, the author was concerned that the preparatory work for an eventual jihadist takeover in Yemen was not complete at that point.

The author even proposed a truce with Saleh, noting that even a unilateral agreement would allow al Qaeda to focus on the United States. This sentiment was echoed in a letter from bin Laden to Wuhayshi, declassified in 2012, in which al Qaeda’s emir explained that the jihadist movement was in a preparatory stage in Yemen, meaning that “it is not in our interest to rush in bringing down the regime.” (Bin Laden eventually changed his mind on this point, as events on the ground seemed to dictate a more aggressive posture.)

Al Qaeda’s thinking about Mauritania and Yemen is characteristic of the newly released documents. Throughout, the group’s leadership urges caution and occasional tactical cooperation with enemies. In a letter to Abu Ayyub al-Masri, al Qaeda in Iraq’s emir, a senior al Qaeda official warned against carrying out operations in Iran. Iran, he explained, had become al Qaeda’s “main artery for funds, personnel, and communication.” The official similarly advised al-Masri to refrain from striking Turkey and Lebanon, urging him to instead “devote your total resource to the fortification of the nation, and the fight against the crusaders and the apostates.”

These directives show that al Qaeda was preparing for the long haul. The group anticipated and prepared for setbacks, even catastrophic ones. In a letter to Ansar al-Islam, an Iraq-based militant group, a senior al Qaeda official (possibly bin Laden himself) explained that “Iraq is not the end of the road.” He stated that if al Qaeda were defeated in that theater, it would be a “catastrophe,” but nonetheless “we must always prepare ourselves for anything that might happen.”

The official noted that “jihad will continue with us or without us,” revealing an organizational belief that the struggle to reestablish the caliphate would persist long after al Qaeda’s founders had died.

This prediction has proven all too true. Al Qaeda has continued to adapt and thrive since bin Laden’s death, while adhering to its late emir’s methodical approach. The group’s strategy has survived several seismic developments that were widely viewed as the organization’s death knell.

The so-called “Arab Spring” was widely perceived as a mortal blow to al Qaeda, a repudiation of the group’s claim that only violent jihad could sweep away the Middle East’s authoritarian regimes. Instead, al Qaeda celebrated the revolutions. In a newly-released letter to one of bin Laden’s assistants, an al Qaeda official expressed his hope that the uprisings would “spread all over the Muslim homelands, which will accelerate the triumph and unity of all Muslims.”

Al Qaeda prepared itself to succeed in the post-revolution turmoil, using bin Laden’s model of preparation and strategic restraint. Al Qaeda covertly expanded its presence in countries like Libya and Tunisia, using front groups such as Ansar al-Sharia to conduct Da’wah and recruitment activities. Indeed, a previous batch of Abbottabad documents released for a criminal trial show that al Qaeda had established itself in Derna, Benghazi, and elsewhere in Libya even before bin Laden’s death.

In multiple theaters today, including Syria/Iraq and Yemen, al Qaeda has embedded itself in local communities, developing relationships.

After seizing control of the Yemeni port city of al-Mukalla, AQAP set up a group known as the “Sons of Hadramawt,” intended to appear as an indigenous force, and appointed a local council, the Hadhrami Domestic Council, to govern the city.

It has likewise sought to build coalitions in Syria, as evidenced by a secret directive issued in early 2015 by the group’s current emir Ayman al-Zawahiri. Zawahiri’s missive instructed Jabhat al Nusra, al Qaeda’s Syrian affiliate, to work more closely with other rebel groups, strengthen ties with local communities, build sustainable safe havens, and cease planning for attacks against the West.

Al Qaeda’s strategic flexibility has also been on display in its response to the challenge posed by ISIS, whose emergence was another challenge that many analysts thought would cripple al Qaeda. While ISIS has challenged al Qaeda’s position within the jihadist community, it has also given al Qaeda a long-awaited opportunity to remake its image, which had been tarnished by failed governance experiments in Iraq and Mali, among other places. ISIS has become a convenient foil for al Qaeda in its efforts to gain greater operating space.

Time and again, al Qaeda has been able to mitigate setbacks, or even turn them to its advantage. The group’s vision of a multi-generational jihadist struggle has enabled it to think and act strategically, pursuing long-term objectives while passing up ephemeral or unsustainable victories.

Al Qaeda’s ability to think and plan for the long term stands in contrast with both ISIS and also the U.S. government. Election cycles, budgetary uncertainty, and inter-agency squabbles impede strategic thinking in the fight against al Qaeda. As we continue to overlook al Qaeda’s forward-looking approach, we underestimate the group and fall into its traps. At a time when al Qaeda is quietly gaining ground across the Middle East, North Africa, and the Horn of Africa, and benefiting from the international community’s myopic focus on the Islamic State, it is more important than ever that we fully appreciate al Qaeda’s long-term planning.

Article Link to the Daily Beast:

A Homegrown Solution to Terror in West Africa

By The Bloomberg View Editorial Board
March 16, 2016

Preventing small bands of suicidal fanatics with Kalashnikovs from shooting up hotels is a tall order for any government. So Ivory Coast will need outside help as it responds to last Sunday's slaughter at a seaside resort favored by expatriates. But a lasting solution to the regional threat of terrorism depends more on cooperation among West African nations than on the U.S. or France.

With the deaths of at least 18 people in this week's assault, more than 50 people have been killed since last November by terrorists in high-profile attacks on hotels and resorts. Along with Burkina Faso and Mali, Ivory Coast has been caught up in a deadly one-upmanship between al-Qaeda and Islamic State, as they vie for adherents from local Muslim populations that have themselves come under the swayof fundamentalist preachers funded by Middle Eastern states.

In taking credit for the attack, al-Qaeda claimed to be fighting French neocolonialism. That may not convince the most ardent Francophones in the Ivorian capital, Abidjan, but it may strike a chord with others angered by corruption and lack of opportunity in Ouagadougou, or those who have suffered in the long, French-backed fight against Islamic rebels in northern Mali.

Such sentiment notwithstanding, Western training and support for security forces must of course continue. The United Nations might want to slow down its planned withdrawal of peacekeepers from the Ivory Coast. And each of these nations remains in dire need of foreign aid and investment.

Yet relying too heavily on French rapid reaction forces or expanding the role of U.S. drones and special forces in fighting terrorists risks reinforcing al-Qaeda's self-justifying toxic narrative. As the cases of Iraq and Afghanistan show, it can also create a kind of free-rider problem, undercutting any incentive a state may have to get its own act together.

The governments of West Africa need to make good on their much-vaunted plans for joint military forces to fight terrorist groups. They also need to fulfill their pledges to cooperate with one another on sharing intelligence, setting rules for "hot pursuit" across borders, and shutting down terrorist financing. And they need to cooperate in monitoring the influx of fundamentalist clerics and charities that have turned mosques and educational institutions into a battleground for outside forces.

Ivory Coast, Mali and Burkina Faso are not wealthy nations, and each is recovering from an insurgency, a coup or some other form of civil unrest. If they want to show their citizens they are capable of protecting them -- and strengthen their state institutions as well -- the first thing they need to do is cooperate more closely in the fight against terrorists.

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Bernie Sander's Comeback Calendar

Sanders is favored to beat Hillary Clinton in seven of the next eight states, which means the media narrative is about to shift in his favor.

By David Dayen
The New Republic
March 16, 2016

Bernie Sanders had a bad night on Super Tuesday II. He was unable to repeat his Michigan upset in the similar Rust Belt state of Ohio. Hillary Clinton won by 13 points in the Buckeye State, by 14 in North Carolina, and she blew him out in Florida by over 30 points, continuing her dominance in the South; she even eked out wins in Illinois and Missouri. According to this careful count, Clinton leads by 317 pledged delegates. Because every Democratic primary awards delegates proportionally, making it hard to run up the score without a series of blowouts, Sanders’s path to overtake Clinton looks prohibitive.

But there’s one “comeback kid” narrative left in Bernie Sanders. It will have nothing to do with re-jiggering his message, which seems immutable anyway. It’s merely a function of the primary calendar.

Sanders held his primary night speech in Phoenix, Arizona, probably because that’s the only state he might lose between now and the New York primary on April 19. Indeed, because of a quirk in the calendar, Sanders is favored to win seven of the next eight states, according to Nate Silver’s primary model, which plugs in demographic data to estimate the state-level Sanders/Clinton vote.

The states are mostly homogeneous, and clustered in the West, where Sanders has done well. Six of the nine are caucuses, another Sanders strength. For example, Arizona votes next week, along with Idaho and Utah. Alaska, Hawaii, and Washington state go to the polls on March 26, a prelude to an April 5 showdown in Wisconsin, another Rust Belt state that has a fairly liberal history in primary elections. Then Wyoming votes on April 9.

Because most of these states are small, even resounding Sanders victories won’t deliver the number of delegates needed to meaningfully close the gap. But they will give the traditional media an opportunity to herald a “fundamental change” in the Democratic primary, even though that change will be largely geographic. You will surely hear pundits talking about how Clinton “can’t close the deal,” and hours of theater criticism about her stump speeches, when the truth is that we’re just hitting an air pocket of pro-Sanders states. The delegate math will remain relatively unforgiving.

Still, Clinton’s campaign will have a hard time saying that the primary is effectively over and that Sanders should pack it in—because eight years ago, she was in Sanders’s position.

Barack Obama ran the table in several states after 2008’s version of Super Tuesday, building up a delegate lead that was similarly imposing (though not quite as big as Clinton’s). Clinton struck back in Ohio and Texas in early March, but there was a six-week lull until the final handful of states, and the delegate math didn’t add up for Clinton. After all, John McCain had already wrapped up the nomination on the other side, unlike the unsettled GOP race this year. Many said it was incumbent upon Clinton to let Obama get on with the general election, and that to stay in would harm the party.

Clinton did not leave the race, winning seven of the last ten primary contests despite having no real shot at reversing the delegate count. And the idea that it crippled Obama for the general election was completely unfounded. In fact, organizing in all 50 states bore fruit in November. New voters brought into late primaries in North Carolina and Indiana led to general election victories for Democrats in those states for the first time in decades.

Clinton stayed in the race in 2008 because she owed it to her supporters to play things out. You could say the same for Sanders. As Martin Longman points out, if he can control 40 percent of the total delegates at the convention, he can have substantial influence over the writing of the party platform, the rules committee governing future primaries, even potentially the selection of a vice president. That power is significant for someone who wants to spark a political revolution; it’s the way you begin to take over, or at least refashion, a party.

Moreover, the way the Sanders campaign is organizing in the primaries, making millions of calls and exponentially expanding capacity for field campaigns, could offer lessons to Democrats down the ballot. Sanders supporters helped Kim Foxx to victory in the Cook County State’s Attorney race, a progressive triumph that could be replicated nationwide.

The biggest implication for Bernie’s Comeback Calendar is the perceived momentum shift driven by a media that always prefers a horse race over a gallop to victory. Will that somehow alter the fundamentals of the race heading into a spate of Northeast primaries on April 19 (New York) and 26 (Connecticut, Delaware, Maryland, Pennsylvania, and Rhode Island)? That’s unclear. But it will be the constant chatter for about a month, delegate math notwithstanding.

Article Link to the New Republic:

After Trump Warns of Riots and Pulls Out, Fox News Cancels Republican Debate

By Megan Cassella
March 17, 2016

The U.S. Republican presidential debate scheduled for next week in Utah has been canceled, host Fox News said on Wednesday, after party front-runner Donald Trump told the network he would not participate.

Trump, who has clashed with Fox News throughout his campaign, told the network in an interview on Wednesday he would not appear at the event, scheduled for Monday, because he thought the Republicans had "had enough debates."

Ohio Governor John Kasich said afterward he would also skip the debate unless Trump changed his mind and decided to come.

U.S. Senator Ted Cruz of Texas, the third remaining Republican candidate seeking the party's nomination for the Nov. 8 presidential election, criticized Trump on Twitter, calling him #DuckingDonald and urging his supporters to tell Trump to attend.

"He's scared to debate," Cruz said in an interview on Fox News. "He's afraid of being challenged."

Fox News, part of the Twenty-First Century Fox Inc broadcast media and entertainment company controlled by Rupert Murdoch, earlier this week announced the debate, to be held in Salt Lake City, its latest in the primary season. Utah holds its presidential primary next Tuesday.

"Ted Cruz has expressed a willingness to debate Trump or Kasich - or both. But obviously, there needs to be more than one participant," Fox News Channel’s executive vice president of news, Michael Clemente, said in a statement. "So the Salt Lake City debate is canceled."

After the cancellation, Trump posted on Twitter that he would make a "big speech" the night of the debate, "but I wish everyone well."

The brash New York billionaire skipped a Fox News debate in Iowa in January after complaining he had been mistreated by the network. He has long clashed with anchor Megyn Kelly and revived criticism of her on Tuesday, saying on Twitter she was "crazy" and "unwatchable."

The Iowa debate went on as scheduled, despite Trump's decision to host a rally at the same time. But back in January, the Republican field was much larger, with Trump among eight contenders who qualified to participate in the Iowa debate, and four others qualifying for an earlier "undercard" debate.

Wednesday marked the first time either party has canceled a debate.

Record Ratings

Trump's participation in the debates has helped networks draw record audiences. Two previous debates this election cycle hosted by Fox News attracted the two largest U.S. audiences for non-sports cable TV programs in history.

Some 24 million Americans tuned in for the first Republican presidential debate last August, while another in Detroit earlier this month attracted 16.9 million viewers.

In February, CBS Chief Executive Les Moonves spoke candidly about the advertising money the Republican front-runner was bringing to the network.

"The money's rolling in and this is fun," Moonves said at a telecommunications conference in San Francisco, according to the Hollywood Reporter.

"I've never seen anything like this, and this is going to be a very good year for us," Moonves said. "Sorry. It's a terrible thing to say. But bring it on, Donald. Keep going."

Article Link to Reuters:

Thursday, March 17, Morning Global Market Roundup: Asia jumps as cautious Fed lifts risk appetite, dollar on defensive


March 17, 2016

Asian shares gained across the board on Thursday as risk appetite revived after the Federal Reserve reduced the number of interest rate hikes expected this year, while the dollar nursed substantial losses.

Spreadbetters saw the upward momentum for equities being retained in Europe, forecasting a higher open for Britain's FTSE .FTSE, Germany's DAX .GDAXI and France's CAC .FCHI

The potential for more money to continue flowing into commodities and equities, rather being lured by higher U.S. interest rates, boosted crude oil and emerging market stocks.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS climbed to a two-month high and was last up 1.9 percent.

Australian stocks added 1 percent, South Korea's Kospi .KS11 rose 0.9 percent and Shanghai .SSEC was up 1 percent. Japan's Nikkei .N225 pared earlier gains and fell 0.6 percent as the dollar slipped versus the yen.

Asian equities took their cue from Wall Street, where the S&P 500 .SPX closed at its highest level this year following the U.S. central bank's cautious message. [.N]

The Fed concluded a closely watched two-day policy meeting on Wednesday by leaving interest rates untouched, as expected, and signaling fewer rate hikes in coming months as the United States continues to face risks from an uncertain global economy.

"Removing interest rate risk from the near horizon has been enough to coax money back into risky assets, but price increases in gold and the depreciation of the dollar would indicate that quantification of the degree of risk still varies greatly," said Martin King, co-managing director at Tyton Capital Advisors.

Global growth concerns, particularly regarding China, have rattled markets through much of the this year, and this was seen to have influenced the Fed's position.

"In our view, the Fed has become increasingly responsive to changes in financial conditions. We believe this sensitivity is a problem since we see the Fed's intended policy actions as contributing to the very financial conditions that led to its eventual inaction," strategists are Barclays wrote.

The dollar index hovered near a one-month low of 95.539 .DXY hit overnight after the Fed reduced its expectations for interest rate hikes in 2016 to two from four.

The euro was near $1.1244 EUR=, its highest since March 15. The dollar descended to a three-week low below 112 yen JPY.

Commodity-linked currencies rose strongly as products such as oil and iron ore soared after the Fed's decision.

The Australian dollar, which already jumped 1.2 percent overnight, caught a fresh lift from an upbeat local jobs report and rose to an eight-month high of $0.7620 AUD=D4.

The Canadian dollar was firm at C$1.3098 to the dollar CAD=D4 after rallying nearly 2 percent to a four-month peak of C$1.3094 overnight.

Emerging market currencies such as the Malaysian ringgit and Indonesian rupiah also firmed. The South Korean won KRW=KFTC touched its highest point against the dollar since the end of December.

Oil prices also rose as major producers firmed up plans to meet in Qatar to discuss an output freeze. U.S. crude oil rose to a three-month peak of $39.38 a barrel CLc1 after surging nearly 6 percent overnight. Brent LCOc1 was up 27 cents at $40.60 a barrel. [O/R]

Three-month copper on the London Metal Exchange CMCU3 traded up 1.5 percent at $5,009.50 a tonne. A weaker greenback tends to favor commodities traded in dollars by making them cheaper for non-U.S. buyers. [MET/L]

Spot gold XAU= slid 0.4 percent to $1,258.15 an ounce as the precious metal lost steam following Wednesday's 2.5 percent surge. [GOL/]

Spot iron .IO62-CNI=SI rose 1.5 percent to $52.50 a tonne late on Wednesday, helping the metal reverse some the steep losses suffered over the past week.

Article Link to Reuters:

Trump ‘winning’ by preying on worst liberal and conservative instincts

By Bill Schneider
March 16, 2016

Trump is trouble. That became clear on Saturday when Donald Trump had to shut down a campaign rally in Chicago after violence broke out.

But it did not seem to do Trump a bit of harm at the polls three days later. He virtually sewed up the Republican nomination with victories in Florida, Illinois and North Carolina. The obvious conclusion: Many of his supporters are asking for trouble.

A group of conservatives is meeting in Washington this week to plot strategies to deny Trump the nomination if he fails to win a majority on the first ballot at the Republican convention in July. Even if Trump has more delegates than anyone else. If the party tries to take the nomination away from him, a Trump supporter warned, “We’ll burn the place down.”

Trump is a crude populist. That doesn’t say very much because populism is not any one thing.

There’s left-wing populism, which targets wealth and privilege (“country-club conservatives”). That’s Senator Bernie Sanders (I-Vt.) with his relentless criticism of Wall Street and “the 1 percent.” There’s right-wing populism, which targets the snobbery and self-importance of the educated elite (“limousine liberals”). That’s Ben Carson with his relentless criticism of political correctness and the contempt of the well-educated for traditional religion.

Trump combines both.

Trump a left-wing populist? His attack on free trade is the same as Sanders’. Despite his wealth, he has no love for Wall Street (“The hedge fund guys are getting away with murder”). Nor they for him. Wall Street believes Trump would be a disaster for markets and the economy. The titans of Wall Street are spending millions of dollars on anti-Trump ads to try to deny him a majority of convention delegates.

Trump a right-wing populist? That would be his attacks on immigrants, minorities and women. Plus his embrace of old-fashioned isolationism where the United States avoids foreign intervention unless U.S. interests are directly threatened. Then we bomb them to smithereens. His strategy for dealing with Islamic State: “We bomb the shit out of ’em.”

Trump’s support cuts right across ideological categories. He does best among non-college-educated white voters, particularly men. That’s yet another element in Trump’s populism: the desire for a strongman. In 1959, the great sociologist Seymour Martin Lipset wrote about “working-class authoritarianism” — the predisposition to intolerant, extreme and undemocratic attitudes among “lower-class persons.”

Trump has expressed admiration for Russian President Vladimir Putin. “He’s running his country and at least he’s a leader, unlike what we have in this country,” Trump said on MSNBC. As for Putin’s methods, “I think our country does plenty of killing also.”

Trump’s latest Putinesque move is to deny access to his events to news organizations that have been critical of him: The Des Moines Register, Univision, Fusion, The Huffington Post,National Review, Mother Jones, Buzzfeed and, most recently, Politico. It’s the same message he delivers to protesters at his rallies: “Get ’em out of here!” In his victory speech on Tuesday night, he made sure to call the media “disgusting.”

Many Americans seem to want a strongman for the very reason Trump gave. Because no one in government can get anything done. Washington is mired in gridlock. Trump promises to get things done his way, which he doesn’t bother to explain except to promise that he can “make America great again.” He doesn’t even bother with experts and advisers. (Asked whom he is consulting on foreign policy, Trump answered “My primary consultant is myself.”) He wants to do it his way. Alone.

Why is Trump winning the Republican race? Keep in mind that the United States is the most populist country in the world. Next to the United States, the rest of the world is Saudi Arabia.

That’s because this country was originally settled by runaways from authority — oppressive governments, established churches, closed economies. Distrust of elites is a deep-seated value that runs throughout American history. Ever notice how rich and powerful people — business executives, politicians, bureaucrats – are portrayed in U.S. popular culture? Usually as incompetent, corrupt or worse.

American politics, like the American economy, is highly entrepreneurial. Where there is a market, there will be a product. If there is an unpopular war, there will be an antiwar candidate. If voters are unhappy about high taxes, there will be an anti-tax candidate. If the public is fed up with politics as usual, outsiders will suddenly spring up to carry the anti-politics banner, like Ross Perot in 1992. And now Trump.

Exit polls reveal that the one characteristic that best defines Trump supporters is anger. Asked “Which best describes your feelings about the way the federal government is working?” most voters who say “angry” — rather than “enthusiastic,” “satisfied” or “dissatisfied — are voting for Trump.

What are they angry about? Two things: economic decline and the loss of cultural influence.

Trump does best among voters from the declining sectors of American life. A study by theNew York Times. “The Geography of Trumpism” found that Trump does best in places with high percentages of whites with no high school diploma and low numbers of ethnic and religious minorities, “old economy” jobs like agriculture and manufacturing and low labor force participation rates. Appalachia, for example.

They are Americans who have been left out of the economic recovery, whose jobs are threatened by foreign trade, who are declining demographically and whose traditional religious and cultural values are under challenge. They’re an angry resistance movement, and Trump is their resistance leader. Ideology? They hate liberals like President Barack Obama with their snobbish condescension. And they hate conservatives like Mitt Romney with their heedless rapacity.

If the conservative effort to stop Trump fails, there will be only one thing standing between him and the presidency — Hillary Clinton. It may pose an agonizing choice for many voters. Two well-known figures, long in the public eye, both negatively regarded by a majority of Americans. Trump more so than Clinton — which is what gives Democrats hope.

Americans can all look forward to the first debate between Trump and Clinton on Sept. 26 in Dayton, Ohio. Sparks will fly. And the viewership will set records.

Article Link to Reuters:

A Dangerous Showdown Looming With China

By David Ignatius
The Washington Post
March 16, 2016

WASHINGTON -- The Obama administration is moving toward what could be a dangerous showdown with China over the South China Sea.

The confrontation has been building for the past three years, as China has constructed artificial islands off its southern coast and installed missiles and radar in disputed waters, despite U.S. warnings. It could come to a head this spring, when an arbitration panel in The Hague is expected to rule that China is making "excessive" claims about its maritime sovereignty.

What makes this dispute so explosive is that it pits an American president who needs to affirm his credibility as a strong leader against a risk-taking Chinese president who has shown disregard for U.S. military power and who faces potent political enemies at home.

"This isn't Pearl Harbor but if people on all sides aren't careful, it could be 'The Guns of August,'" says Kurt Campbell, former assistant secretary of state for Asia, referring to the chain of miscalculation that led to World War I. The administration, he says, is facing "another red-line moment where it has to figure out how to carry through on past warnings."

What troubles the White House is that President Obama thought he was assured by President Xi Jinping in Washington last September that China would act with restraint in the South China Sea. "China does not intend to pursue militarization," Xi said publicly in the Rose Garden.

China's recent moves appear to contradict these assurances. Administration officials point to China's installation of surface-to-air missiles on Woody Island in the Paracel chain in February, and its recent installation of military radar systems on Cuarteron Reef, one of the artificial islands it has created hundreds of miles from its coast.

Obama cautioned in November against such provocative actions, telling an Asia-Pacific economic summit: "We agree on the need for bold steps to lower tensions, including pledging to halt further reclamation, new construction, and militarization of disputed areas in the South China Sea."

China has largely ignored such warnings, and the administration's problem now is how to assure Southeast Asian allies that it's not passive about the Chinese threat, while avoiding open military conflict. The U.S.-China breach could widen when Obama and Xi meet March 31 at the Nuclear Security Summit in Washington.

One trigger for escalation could be China's response to the forthcoming ruling by the arbitration panel in The Hague in a case brought by the Philippines in 2013. The Philippines argued that China was making an "excessive claim" to nearly all the South China Sea by asserting what it calls the "nine-dash line," based on old maps and claims. The panel will probably issue its ruling in April or May, and Campbell and other knowledgeable experts predict that it will carefully validate the Philippine position.

What will China do next? Beijing has denounced such arbitration of its maritime claims, and some U.S. officials believe it may respond to an unfavorable ruling by declaring an air-defense identification zone, or "ADIZ," in the South China Sea -- in effect banning flights there without Chinese permission. This would present a new and dangerous provocation for Washington.

The Pentagon argues that the U.S. should immediately challenge any air-defense identification zone claim by flying U.S. military planes into the area. That's what happened in November 2013 when B-52s immediately challenged an ADIZ declared by China in the East China Sea. Because this overflight had previously been scheduled, the Pentagon didn't have to ask White House approval; Pentagon officials fear that if such permission had been required, it would have been denied.

This time, the White House has an intense interagency planning process underway to prepare for the looming confrontation. Options include an aggressive tit-for-tat strategy, in which the U.S. would help countries such as the Philippines and Vietnam build artificial islands of their own in disputed waters. The Philippines effectively took such a step in 1999 when it deliberately grounded a large vessel on a shoal in the Spratly Islands; it has recently resupplied that vessel, while U.S. drones patrolled overhead.

Campbell contends that the wisest course for the United States would be to work with other Southeast Asian nations to challenge Chinese claims. This might include planes and ships from Australia, Singapore, India and European countries, for example.

"You don't want the Chinese to lose face," says Campbell. "But you want their leadership to understand that if they continue along this path, they risk spiraling the relationship into a very negative place."

Article Link to Real Clear Politics:

Is Putin trying to pressure Assad to negotiate?

Since Russia announced its partial withdrawal of troops from Syria, Iranian commentators have been scrambling to explain the "surprising" decision.

By Arash Karami
March 16, 2016

The official position of Iranian and Russian officials regarding Russia’s sudden decision to partially withdraw troops from Syria has been that Russia's objectives have been achieved and the move will allow the political process between the Syrian sides to be successful. Ali Shamkhani, the secretary of the Supreme National Security Council, is the latest Iranian official to address the withdrawal, saying March 16, “The withdrawal of Russia from Syria was based on predetermined coordination and plans and in no way was it unexpected.” However, not everyone in the Iranian media is buying the official explanations.

One of the more critical articles of the Russian withdrawal appeared in Reformist Arman Daily, headlined, “Russia was not a strategic partner.” Russia analyst Morteza Makki wrote that the withdrawal can be seen as “an agreement between Russia and the United States for the establishment of a cease-fire … and a new political process.” Makki continued that it is natural for two negotiating sides to apply pressure on their allies, “but not with such speed that it would surprise everyone.”

Makki wrote that despite Zarif’s positive statement on the withdrawal, “this quick and surprising decision by Russia shows that Iran and Russia’s partnership in Syria was not a strategic partnership. The Russians make decisions based on their own calculations and interests, and the partnership was not such that Iran and Syria would be able to push forward with their views and positions by leaning on the Russians.”

Makki continued that it is possible Russia’s decision was made to force President Bashar al-Assad’s government to show flexibility in the Geneva negotiations, saying that in their recent statements, the Syrians have been very optimistic and have presented red lines regarding Assad’s departure. Even conservative media outlets have suggested Russian President Vladimir Putin was angered by Syrian officials' comments ahead of the negotiations in Geneva.

When it comes to Syria, the Iranian media has typically been keen to conform to the statements of officials. To see an article suggest that the official version presented by authorities is hiding key points is rare indeed. Most Iranian media outlets have parroted official positions on the Russian withdrawal, but they, too, have struggled to explain it. Even Iran Newspaper, which operates under the administration's direction, called the withdrawal “surprising.”

The hard-line Yalasarat, Ansar-e Hezbollah's weekly publication, reported that Russia’s withdrawal was even “more surprising” than its entrance into the Syrian civil war. The article offered its own explanation for Russia’s withdrawal, suggesting that Moscow had four objectives: to strengthen Assad’s position, to show Russia's military power, to weaken the Syrian opposition and to influence Western positions on sanctions, Ukraine and NATO expansion. The article claimed that the first three objectives were achieved to a large degree and Russian’s decision was made to show the Syrian opposition its good intentions and also to force Assad to show more flexibility in the negotiations. It is rumored that Russia also presented a proposal for a new constitution.

The article warned that while the opposition thinks Russia is abandoning Syria, “they are completely wrong,” and “While the Russian [jets] are leaving Syria, their [bases] are still there and they can easily return.” Russia’s involvement in Syria, the piece pointed out, is only six months old, while the war has lasted five years and Russia wants to see an end.

Most Iranian media organizations seem to believe a resolution is still far off. Makki wrote that at best, Syria is looking at a short-term semi-cease-fire and an eventual federation. Yalasarat reported that regardless of the talks and Russia’s partial withdrawal, for various reasons, the Syrian crisis is unlikely to end before 2020.

Article Link to Al-Monitor:

Is Putin trying to pressure Assad to negotiate?