Loose Ends (41)

Got a whole bunch of short items to get off my spindle this morning.

So Elon Musk says the Saudis are interested in financing Tesla to go private. Why would the Saudis want to become the major financial player in an electric car company? I simply can’t imagine. I guess Musk is too young to remember an old Johnny Carson Tonight Show line about an idea being as bad as “an electric car dealership in Saudi Arabia.” And if Musk thinks shareholders are a pain in the rear, just wait until he has to deal with Saudi bondholders. I hear they can really take your head off if you cross them. Or maybe the Saudis just like that deep Musky smell in new Teslas—it’s even better than Corinthian leather.

John has noted here already that over 100 newspapers will published coordinated editorials on Thursday proudly proclaiming that they are not the enemy. Of course, the most basic rule of PR is that if you are having to rebut a charge defensively (“Do you still beat your wife?”), you’re losing. Also, I recall the fuss in the media in 1983 when the Reagan Pentagon didn’t allow the media to go ashore in Grenada during our invasion there. Why? “Because,” a source said on background, “you don’t take the enemy with you on your military campaigns.” Heh.

But there’s also a huge streak of hypocrisy here. Anyone remember a few months back when Sinclair Broadcasting had all of its own TV stations issue the same promotional editorial message about their journalistic independence? The rest of the media, and certified smart people everywhere, blasted it as “propaganda.” Why? Because Sinclair is conservative, and therefore implicitly pro-Trump I suppose. Whereas the newspapers editorializing in coordination this week are part of “The Resistance,” so it’s okay then. At least Sinclair coordinated its message with its own wholly owned TV stations—just as chain newspapers sometimes run the same house editorial. This week’s stunt involves newspapers with different ownership, though it shows that the media really is, in that great phrase of Clement Greenberg, a “herd of independent minds.”

Author Walter Kirn for the win on this one:

 

Don’t look now but. . . The next global financial contagion may be setting up fast courtesy of “our friends,” the Turks. While everyone worries that Trump’s aggressive trade practices with regard to China and Europe threaten global economic growth, it is Turkey where U.S. trade sanctions are having their largest effect, though it should be noted that Trump’s Turkey tariffs are more political than economic; the tariffs on Turkey’s exports of metals are in response to Turkey jailing an American cleric. The Turkish Lira is in free fall, Turkish stocks are tanking, and interest rates are spiking. Greece—Greece!—now looks more favorable than Turkey. The good folks at the Wall Street Journal‘s Daily Shot give us some nice dramatic charts of the scene:

The earlier spike you see on this chart coincides with the Brexit vote result in 2016.

Credit Default Swap Rate

There’s much more at The Daily Shot (WSJ subscription required) about bank imbalances and fund flows, but this is enough for a general picture.

This all happens at a time when Turkey’s future in NATO is in serious question. Turkey’s dictator Recep Erdogan has voiced threats to pull Turkey out of NATO, and I say good riddance. In fact I think it would have a salutory effect on NATO, and bolster Trump’s drive to get our European partners in NATO to step up with more serious military spending and preparations. But it could be very bumpy. The New York Times editorial page will be upset.

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