Trump’s Not Gonna Let a Little Murder Get in the Way of His $110 Billion Arms Deal

A new report in The Washington Post, citing U.S. intelligence intercepts, appears to confirm what is looking increasingly likely: that Saudi Crown Prince Mohammed bin Salman personally ordered the operation to lure journalist Jamal Khashoggi from his home in Virginia to the Saudi consulate in Istanbul last week, and had him murdered. Turkish security officials told The New York Times that they believe he was “dismembered . . . with a bone saw” by a 15-person team, dispatched from Saudi Arabia to make the vociferous critic of Salman’s government disappear. It is, in other words, not a good look for the so-called “reformer” prince, whose country has denied killing Khashoggi, but is not trying particularly hard to be convincing. Nor is it a good look for Donald Trump and Jared Kushner, who don’t seem eager to terminate a chummy relationship with the crown prince over a credible murder allegation. At least not just yet.

For those who need a quick refresher on the Kushner-M.B.S. bromance, the two first bonded over lunch at the White House back in March 2017, with the Boy Prince of New Jersey subsequently persuading his father-in-law to visit Riyadh for his first trip abroad as president. From there, it was basically a buddy comedy for the ages, with Kushner championing M.B.S. when the young prince was battling with his cousin to become his father’s heir; supporting his move to blockade Qatar and tacitly supporting his brutal war in Yemen; having back-slapping dinners with the prince in D.C. and the Saudi capital; and reportedly giving M.B.S. the names of disloyal Saudi royals who were later rounded up and imprisoned (Kushner denies this). Perhaps most significant, the two struck a deal for a $110 billion weapons sale—not a bad inducement if you’re trying to get the future king’s blessing for your Israeli-Palestinian peace plan. Salman’s financial ties to Trump run deep, too. In March, the prince’s entourage almost single-handedly boosted revenue at Trump’s New York hotel by 13 percent. Presumably, Kushner and M.B.S. had discussed plans to get a boys trip on the calendar in between work and family commitments.

So the news that Saudi Arabia likely murdered a journalist who spoke critically of the crown prince’s regime has put Kushner in, as the Times puts it, an “extremely awkward position”! At first, Kushner and the White House chose to stay silent on the matter, like friends of Brett Kavanaugh refusing to dignify allegations of their pal being a fall-down drunk with a sexual-predator problem. But as the evidence kept piling up, it was clear they had to at least feign some level of concern, which apparently involved calling up M.B.S. and being like, “Hey, did you kill this guy? Nope? O.K., works for us!”

On Tuesday, the White House said, Mr. Kushner and John R. Bolton, the national security adviser, spoke to Prince Mohammed by phone about Mr. Khashoggi’s disappearance. Secretary of State Mike Pompeo also called him.

“In both calls, they asked for more details and for the Saudi government to be transparent in the investigation process,” said the White House press secretary, Sarah Huckabee Sanders.

Meanwhile, Kushner’s father-in-law suggested Wednesday night that he thought the Saudis probably did kill Khashoggi, expressing less anger about the situation than he did when Nordstrom dropped his daughters’s clothing line. “It would not be a positive,” he told Fox News. “I would not be happy at all.” But while the smallest perceived slights generally result in the president vowing to destroy another country—for instance, threatening to economically cripple Ecuador for promoting breastfeeding—he apparently sees no reason to stop doing business with the kingdom:

. . . The president expressed reluctance to punish Saudi Arabia by cutting off arms sales, as some in Washington were proposing. “I think that would be hurting us,” he said. “We have jobs, we have a lot of things happening in this country.”

Also on Thursday, Trump made his disregard for Khashoggi’s death even more obvious, telling reporters: “Again, this took place in Turkey, and to the best of our knowledge Khashoggi is not a U.S. citizen, is that right? He’s a permanent resident, O.K. . . . As to whether or not we should stop $110 billion from being spent in this country . . . that would not be acceptable to me.” Incidentally, many say the deal is not worth anywhere near $110 billion, though accuracy has never been the president’s forte (that would be cozying up to autocrats who flout democratic values and human rights).

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Business execs worry about optics of appearing chummy with murderous despot

On the one hand, there’s a lot of money to be made as Crown Prince Mohammed bin Salman pledges to open up Saudi Arabia to foreign investment. On the other, there’s that whole possible plot to murder a journalist business:

Since Turkish officials blamed Saudi Arabia for the October 2 disappearance of journalist Jamal Khashoggi, foreign investors have begun re-examining their relationship with Crown Prince Mohammed bin Salman and their participation in his plans to overhaul his country’s economy.

“The disappearance of Saudi journalist Jamal Khashoggi in Istanbul raises fresh questions about Crown Prince Mohammed bin Salman’s reputation as a reformer and political developments pose a growing threat to the economic outlook,” said Jason Tuvey, an economist at Capital Economics.

It marks a moment for executives to choose whether they want to be associated with Prince Mohammed, said Karen Young, resident scholar at the American Enterprise Institute, the Washington think tank. “For high-profile C.E.O.s, this is not a good moment for photo ops,” she said.

One opportunity for photo-ops will come later this month, when Saudi Arabia hosts the Future Investment Initiative, an event that has been dubbed “Davos in the Desert.” While The New York Times has said it will no longer serve as a media sponsor, advisory board member Arianna Huffington no longer plans to attend, and L.A. Times owner Patrick Soon-Shiong has dropped out as a speaker, Wall Street appears to be in the “weighing the pros and cons” phase. As of Thursday afternoon, C.E.O.s from Blackstone, JPMorgan, Credit Suisse, and Bridgewater were all still listed as speakers, as was Treasury Secretary Steven Mnuchin.

Trump is still mad at the Fed

On Thursday, Donald Trump spent a second consecutive day bashing the Federal Reserve for raising interest rates, which he blames for the market falling more than 1,300 points in two days. As New York’s Josh Barro points out, if Trump had idea how any of this works, he would actually blame himself for the Fed raising rates, given that 1) he literally hired a Fed chair, Jerome Powell, who is known for favoring higher interest rates; 2) he used fiscal policy to stoke an already strong economy, which typically pushes inflation up, at which point people like Powell raise rates to fight that inflation; 3) he put Powell in a position of basically having to raise rates so as not to look like Trump’s puppet because, as the president may or may not be aware, the Fed is supposed to be an independent government agency that doesn‘t cater to the whims of any idiot living at 1600 Pennsylvania Avenue. (As for the two-day market decline, the blame finger is also pointing squarely in the direction of Big Orange and his trade war with China.)

But Trump doesn’t understand how any of this works, so on Thursday, instead of blaming himself, he said: “The Fed is out of control. I think what they’re doing is wrong,” adding for some unintentional humor that the rates are “not necessary in my opinion and I think I know about it better than they do.” That critique came less than 24 hours after he told reporters, “The Fed is going wild. I mean, I don’t know what their problem is but they are raising interest rates and it’s ridiculous. The problem in my opinion is Treasuries and the Fed. The Fed is going loco and there is no reason for them to do it and I’m not happy about it.”

But if you thought the president was simply interfering with monetary policy because he wants to be able to tout the stock market’s gains in the run-up to the midterms, you thought wrong! Naturally, he also has his own bottom line on the brain:

Trump on Thursday also indicated that the Fed’s policies were harming him personally. Trump owes more than $300 million to Deutsche Bank AG of debt with interest rates that rise or fall depending on Fed policy. Higher interest rates could increase his debt payments considerably.

Meanwhile, White House National Economic Council director Larry Kudlow, commenting on the president’s obvious attack on the Fed’s strategy, somehow had this to say: “He has never attacked the Fed’s plan or strategy. He has never interfered with that. He is giving his opinion, and it’s an informed opinion.”

President threatens to expose private citizen

In what has now become a regularly scheduled feature of the administration, on Thursday the president of the United States seemingly threatened to reveal the kind of dirt on someone that the National Enquirer used to buy and bury about him. Per CNBC:

Discussing the various leaks coming out of his administration that have been turned into multiple news stories and a few salacious books, Trump responded sharply when an interviewer on Fox & Friends suggested that [Gary] Cohn, along with former White House staff secretary Rob Porter, was one of the sources.

“I was very good to both of them. It could have been [them leaking]. A lot of people have said that,” the president said. “Gary Cohn, I could tell stories about him like you wouldn't believe.”

Cohn who has claimed Fear “does not accurately portray my experience at the White House,” did not respond to CNBC’s request for comment.

Treasury staff should probably lay low for a while

Or at least gird itself for an all-caps rage tweet filled with inexplicable capitalization and charges of being paid by China and/or the Democrats:

The U.S. Treasury Department’s staff has advised Secretary Steven Mnuchin that China isn’t manipulating the yuan as the Trump administration prepares to issue a closely watched report on foreign currencies, according to two people familiar with the matter. . . . President Donald Trump has publicly and privately pressured Mnuchin to declare China a currency manipulator, but Treasury staff haven’t found grounds to do so, according to the people, who spoke on the condition of anonymity. Formally accusing China of manipulating the renminbi wouldn’t trigger any sanctions or retribution, but the move would heighten tensions between the world’s two biggest economies.

Gundlach Says Trump Is “Crazy Like a Fox” to Blame Fed for Sell-Off (Bloomberg

Billionaire Auto Magnate Sues Daughter for $398 Million (Bloomberg)

S.E.C., Tesla submit approval of settlement to court (N.Y.P.)

Uber Wants to Be the Next Cash-Burning Unicorn to Sell Bonds (Barron’s)

Buyer of Banksy Painting That Self-Destructed Plans to Keep It (Bloomberg)

Nixon’s Grandson May Become a Trump Aide on China, Sources Say (Bloomberg)

Facebook purges more than 800 accounts pushing political messages for profit (Washington Post)

Fyre Festival organizer Billy McFarland sentenced to six years in prison (N.Y.P.)

Wells Fargo: Market “tailspin” could last another one to two weeks (CNBC)

Kanye West to Donald Trump: “Time Is a Myth” and Other S--t That Made No Sense (The Slot)

Daughter of woman whose “emotional support” squirrel got her kicked off flight says she’s “upset and angry” (N.Y.D.N.)