Politics

In what we believe is a significant escalation and potentially a hint as to the president's thinking, President Trump said during a phone call with Japanese Prime Minister Shinzo Abe that the US remains committed to defending its territories and allies using all "diplomatic, conventional and - here's the big one - nuclear - capabilities at our disposal." This is the first time Trump has explicitly referenced possible involvement of nuclear weapons in a US response to its isolated antagonist, and also means that the two world leaders discussed the possibility of a nuclear response.

As has become custom, shortly after North Korea engages in some provocative activity, in this case its first ever hyrdogen bomb test, South Korea has traditionally responded with its own military drill, and today was no difference, with Yonhap reporting "that South Korea's military said Monday it conducted a combined live-fire exercise targeting North Korea's nuclear test site."

To be sure, it's not exactly clear how a "drill" can "target" a foreign military site, but we'll assume someone just used Google translate in this case.

Eight months after former President Barack Obama’s last day in office, a CNN source has leaked the letter Obama left for his predecessor on Inauguration Day - an American tradition when power passes from one leader to the next. Trump famously acknowledged receiving the letter, but refused to share its contents with the press.

The contents isn’t too exciting, until the fifth paragraph where, nestled among the platitudes and boilerplate, Obama leaves a warning for his successor:  

Via Global Macro Monitor,

Odds that Gary Cohn will replace Yellen are dropping like a stone on PredictIt.  Putting Cohn behind Warsh and Yellen...

If tax reform looks stalled, and we should find out in the next few weeks, is there any reason for Gary Cohn to stick around if he concludes he won’t be appointed Fed Chair?  We wonder.

Especially after his recent comments to the Financial Times,

With the rest of the world once again seeking a peaceful solution to the escalating North Korean crisis, and having scheduled yet another United Nations Security Council emergency meeting for 10am on Monday to achieve some diplomatic breakthrough...

We along w/Japan, France, the UK and S.Korea have called for an emergency Security Council meeting on N.Korea in the open tomorrow at 10am

— Nikki Haley (@nikkihaley) September 3, 2017