Week in review: Pentagon impatient with Obama


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A report by the top US commander in Afghanistan, Gen Stanley McChrystal, was leaked to Washington Post in a sign of growing impatience inside the Pentagon as the US president, Barack Obama, re-examines the entire strategy to the war. "In Kabul, some members of McChrystal's staff said they don't understand why Obama called Afghanistan a 'war of necessity' but still hasn't given them the resources they need to turn things around quickly," McClatchy Newspapers reported. "Three officers at the Pentagon and in Kabul told McClatchy that the McChrystal they know would resign before he'd stand behind a faltering policy that he thought would endanger his forces or the strategy. " 'Yes, he'll be a good soldier, but he will only go so far,' a senior official in Kabul said. 'He'll hold his ground. He's not going to bend to political pressure.' "On Thursday, [the US secretary of defense, Robert] Gates danced around the question of when the administration would be ready to receive McChrystal's request, which was completed in late August. 'We're working through the process by which we want that submitted,' he said." That answer may have frustrated Gen McChrystal and shortly thereafter his reported was obtained by The Washington Post. In the leaked report he says: "Failure to gain the initiative and reverse insurgent momentum in the near-term (next 12 months) - while Afghan security capacity matures - risks an outcome where defeating the insurgency is no longer possible." The Washington Post reported: "[the US commander] repeatedly warns that without more forces and the rapid implementation of a genuine counterinsurgency strategy, defeat is likely. McChrystal describes an Afghan government riddled with corruption and an international force undermined by tactics that alienate civilians. "He provides extensive new details about the Taliban insurgency, which he calls a muscular and sophisticated enemy that uses modern propaganda and systematically reaches into Afghanistan's prisons to recruit members and even plan operations. "McChrystal's assessment is one of several options the White House is considering. His plan could intensify a national debate in which leading Democratic lawmakers have expressed reluctance about committing more troops to an increasingly unpopular war. Obama said last week that he will not decide whether to send more troops until he has 'absolute clarity about what the strategy is going to be'." In Slate, Fred Kaplan says: "The push is on for President Barack Obama to send more troops to Afghanistan, perhaps as many as 40,000 more. Boxing in Obama was almost certainly the aim of whoever gave The Washington Post's Bob Woodward a copy of the 66-page internal memo by Gen Stanley McChrystal, commander of US and Nato forces in Afghanistan. "Most of the news stories about the memo have emphasised its conclusion that, without more US troops, the war will probably be lost to the Taliban. But the memo (reprinted in full on the Post's Web site) says many other things, too. In fact, high up in his report, McChrystal emphasises that focusing only on troop requirements 'misses the point entirely'. "The point that this focus misses, the general writes, is that this is a war against insurgencies and therefore requires 'a comprehensive counterinsurgency campaign,' in which the main objective is not so much to destroy the enemy but rather to protect the Afghan people - to provide them with security so that the Afghan government can deliver basic services. "When it comes to defeating the Taliban, the memo adds, a 'responsive and accountable government' - one 'that the Afghan people find acceptable' - is every bit as important as a secure environment." In Time magazine, Joe Klein says: "What's provocative about the report is that it was leaked to [Bob] Woodward - a serious breach of conduct by someone, possibly in the military (or a supporter the military's position). This was an effort to lobby a quick decision on troop strength - which the military wants, so that it can begin planning the 2010 fighting season in Afghanistan. But a quick decision is not a good idea right now. "The president needs to know what the next Afghan governmnet is going to look like - will there be a runoff between Hamid Karzai and Abdullah Abdullah? If Karzai still manages to score more than 50 per cent after the phony ballots are tossed, will Abdullah and other Karzai opponents endorse the Karzai government? What sort of moves will Karzai make to restore some confidence in his government? Are the Canadians going to stay in Kandarhar Province, are the British going to stay in Helmand? Are the Dutch and Australians going to stay in Uruzgan? "Obama was absolutely right on the Sunday talk shows: troop levels aren't nearly as important as strategy. He has, at most, one more shot at getting this right." On Wednesday, The New York Times reported: "President Obama is exploring alternatives to a major troop increase in Afghanistan, including a plan advocated by Vice President Joseph R Biden Jr to scale back American forces and focus more on rooting out al Qa'eda there and in Pakistan, officials said Tuesday. "The options under review are part of what administration officials described as a wholesale reconsideration of a strategy the president announced with fanfare just six months ago. Two new intelligence reports are being conducted to evaluate Afghanistan and Pakistan, officials said... "In looking at other options, aides said, Mr Obama might just be testing assumptions - and assuring liberals in his own party that he was not rushing into a further expansion of the war - before ultimately agreeing to the anticipated troop request from General McChrystal. But the review suggests the president is having second thoughts about how deeply to engage in an intractable eight-year conflict that is not going well. "Although Mr Obama has said that a stable Afghanistan is central to the security of the United States, some advisers said he was also wary of becoming trapped in an overseas quagmire. Some Pentagon officials say they worry that he is having what they called 'buyer's remorse' after ordering an extra 21,000 troops there within weeks of taking office before even settling on a strategy." The Christian Science Monitor said: "If an ordinary Afghan could walk into the Washington war rooms where the faltering US war effort is being debated, his message would be: It's the corrupt government, stupid... "Fraudulent election practices kept good people from winning provincial council seats, says Zabit Mohammad Karim from Balkh Province. 'Without power and money, you can't do anything in this country. If we have fraud how are we going to improve the corruption?' "To be sure, most of the Afghans interviewed for this article supported sending more US forces, largely because they don't trust local security forces. Nor do they expect to be able to trust police and Afghan officials anytime soon, if a government comes to power through a rigged vote."

pwoodward@thenational.ae

Muslim Council of Elders condemns terrorism on religious sites

The Muslim Council of Elders has strongly condemned the criminal attacks on religious sites in Britain.

It firmly rejected “acts of terrorism, which constitute a flagrant violation of the sanctity of houses of worship”.

“Attacking places of worship is a form of terrorism and extremism that threatens peace and stability within societies,” it said.

The council also warned against the rise of hate speech, racism, extremism and Islamophobia. It urged the international community to join efforts to promote tolerance and peaceful coexistence.

How Tesla’s price correction has hit fund managers

Investing in disruptive technology can be a bumpy ride, as investors in Tesla were reminded on Friday, when its stock dropped 7.5 per cent in early trading to $575.

It recovered slightly but still ended the week 15 per cent lower and is down a third from its all-time high of $883 on January 26. The electric car maker’s market cap fell from $834 billion to about $567bn in that time, a drop of an astonishing $267bn, and a blow for those who bought Tesla stock late.

The collapse also hit fund managers that have gone big on Tesla, notably the UK-based Scottish Mortgage Investment Trust and Cathie Wood’s ARK Innovation ETF.

Tesla is the top holding in both funds, making up a hefty 10 per cent of total assets under management. Both funds have fallen by a quarter in the past month.

Matt Weller, global head of market research at GAIN Capital, recently warned that Tesla founder Elon Musk had “flown a bit too close to the sun”, after getting carried away by investing $1.5bn of the company’s money in Bitcoin.

He also predicted Tesla’s sales could struggle as traditional auto manufacturers ramp up electric car production, destroying its first mover advantage.

AJ Bell’s Russ Mould warns that many investors buy tech stocks when earnings forecasts are rising, almost regardless of valuation. “When it works, it really works. But when it goes wrong, elevated valuations leave little or no downside protection.”

A Tesla correction was probably baked in after last year’s astonishing share price surge, and many investors will see this as an opportunity to load up at a reduced price.

Dramatic swings are to be expected when investing in disruptive technology, as Ms Wood at ARK makes clear.

Every week, she sends subscribers a commentary listing “stocks in our strategies that have appreciated or dropped more than 15 per cent in a day” during the week.

Her latest commentary, issued on Friday, showed seven stocks displaying extreme volatility, led by ExOne, a leader in binder jetting 3D printing technology. It jumped 24 per cent, boosted by news that fellow 3D printing specialist Stratasys had beaten fourth-quarter revenues and earnings expectations, seen as good news for the sector.

By contrast, computational drug and material discovery company Schrödinger fell 27 per cent after quarterly and full-year results showed its core software sales and drug development pipeline slowing.

Despite that setback, Ms Wood remains positive, arguing that its “medicinal chemistry platform offers a powerful and unique view into chemical space”.

In her weekly video view, she remains bullish, stating that: “We are on the right side of change, and disruptive innovation is going to deliver exponential growth trajectories for many of our companies, in fact, most of them.”

Ms Wood remains committed to Tesla as she expects global electric car sales to compound at an average annual rate of 82 per cent for the next five years.

She said these are so “enormous that some people find them unbelievable”, and argues that this scepticism, especially among institutional investors, “festers” and creates a great opportunity for ARK.

Only you can decide whether you are a believer or a festering sceptic. If it’s the former, then buckle up.

The White Lotus: Season three

Creator: Mike White

Starring: Walton Goggins, Jason Isaacs, Natasha Rothwell

Rating: 4.5/5

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BOSH!'s pantry essentials

Nutritional yeast

This is Firth's pick and an ingredient he says, "gives you an instant cheesy flavour". He advises making your own cream cheese with it or simply using it to whip up a mac and cheese or wholesome lasagne. It's available in organic and specialist grocery stores across the UAE.

Seeds

"We've got a big jar of mixed seeds in our kitchen," Theasby explains. "That's what you use to make a bolognese or pie or salad: just grab a handful of seeds and sprinkle them over the top. It's a really good way to make sure you're getting your omegas."

Umami flavours

"I could say soya sauce, but I'll say all umami-makers and have them in the same batch," says Firth. He suggests having items such as Marmite, balsamic vinegar and other general, dark, umami-tasting products in your cupboard "to make your bolognese a little bit more 'umptious'".

Onions and garlic

"If you've got them, you can cook basically anything from that base," says Theasby. "These ingredients are so prevalent in every world cuisine and if you've got them in your cupboard, then you know you've got the foundation of a really nice meal."

Your grain of choice

Whether rice, quinoa, pasta or buckwheat, Firth advises always having a stock of your favourite grains in the cupboard. "That you, you have an instant meal and all you have to do is just chuck a bit of veg in."

Virtual banks explained

What is a virtual bank?

The Hong Kong Monetary Authority defines it as a bank that delivers services through the internet or other electronic channels instead of physical branches. That means not only facilitating payments but accepting deposits and making loans, just like traditional ones. Other terms used interchangeably include digital or digital-only banks or neobanks. By contrast, so-called digital wallets or e-wallets such as Apple Pay, PayPal or Google Pay usually serve as intermediaries between a consumer’s traditional account or credit card and a merchant, usually via a smartphone or computer.

What’s the draw in Asia?

Hundreds of millions of people under-served by traditional institutions, for one thing. In China, India and elsewhere, digital wallets such as Alipay, WeChat Pay and Paytm have already become ubiquitous, offering millions of people an easy way to store and spend their money via mobile phone. Indonesia, Vietnam and the Philippines are also among the world’s biggest under-banked countries; together they have almost half a billion people.

Is Hong Kong short of banks?

No, but the city is among the most cash-reliant major economies, leaving room for newcomers to disrupt the entrenched industry. Ant Financial, an Alibaba Group Holding affiliate that runs Alipay and MYBank, and Tencent Holdings, the company behind WeBank and WeChat Pay, are among the owners of the eight ventures licensed to create virtual banks in Hong Kong, with operations expected to start as early as the end of the year. 

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