The perfect apple and the Cosmic Crisp

The biggest brand launch since the Pink Lady is changing the nature of the fruit

John Gapper

web_Cosmic Crisp apple launch


The boldest launch of a new apple in two decades will soon reach US supermarkets in the form of the Cosmic Crisp. With 12m trees already growing in the state of Washington and a $10m marketing budget, there has been nothing quite like it since the Pink Lady apple emerged from Australia.

“It is enormously crunchy and wipe-your-face juicy,” says Kathryn Grandy, director of marketing for Proprietary Variety Management, the US company in charge of launching the Cosmic Crisp. “Imagine the Possibilities”, is the tagline for the attempt by growers in the biggest apple-producing state in the US to rival Braeburns and Galas.

The new apple’s marketing budget is minuscule compared with the sum Apple spends on iPhones. But the Cosmic Crisp, so named because someone in a focus group compared the light spots on its glossy red skin to the night skies, is the latest effort by fruit farmers to capture the loyalty of consumers.

In these days of farmers’ markets and the rush to make products more authentic and craft-like, branding an apple feels like an odd strategy, even if the Cosmic Crisp is in most regards as natural as the Cox’s Orange Pippin, a British apple dating back to 1830. Both were crossed from other varieties, not genetically engineered.

But apple farmers have discovered that it pays to have their own brands. The Pink Lady, which was first trademarked in Australia in 1992, is based on the Cripps Pink, a variety created 20 years before. Most shoppers still know it as the former and will tolerate its higher price.

Branding gives growers some pricing power against supermarkets, rather than always being at the latter’s mercy. Although shoppers can distinguish varieties of apples (more than with plums or peaches), the common varieties are so readily available from growers around the world that retailers can pick the cheapest supplier.

The usefulness of a brand means that the WA38, a variety developed at Washington State University in 1997 and patented in 2014, is being launched as the Cosmic Crisp. The state’s farmers have replanted orchards from Red Delicious, a venerable apple that has lost popularity. “We have never had an apple of our own,” says Ms Grandy.

Like other new fruits, the WA38 is shielded by patents, and the university gains a royalty from the sale of every tree. But this is not the only way in which it is controlled. It is a managed variety — protected by trademarks as well as patents, with only selected farmers being licensed to grow it according to set standards.

The right to produce the Cosmic Crisp is confined to farmers in Washington until 2024 and may then be extended until 2034, when the patent on the fruit variety will run out. The state hopes that the Cosmic Crisp brand will by then have gained a value that outlasts its patents, as the Pink Lady did.

The cautionary tale is the Honeycrisp, released in 1991 by the University of Minnesota as an open variety that anyone could grow if they paid the royalty. The Honeycrisp is among the most popular US apples, and one of the varieties crossed to make the Cosmic Crisp, but its US patent protection expired in 2008 and it was not trademarked.

That has made universities and the farmers around them eager to manage and brand their most promising new varieties. The University of Minnesota has produced the SweeTango and Cornell University the SnapDragon. The brands now jostling for recognition include Pazazz, Rave, and the Midwest Apple Improvement Association’s Ludacrisp.

This competition is one reason for the size and speed of the Cosmic Crisp launch. Washington wants to use its farming capacity and marketing clout to develop the brand as fast as possible. This could both boost revenues while the variety is under patent and overpower the emerging rivals.

There is a danger that apples become so efficiently cultivated that they lose the fruit’s essence. The Cosmic Crisp is the ultimate expression of today’s approach, with its consistent appearance, balance of sweetness and tartness, and the crispness and juiciness characteristic of the modern apple.

The Cosmic Crisp also suits farmers. Its flesh does not bruise or turn brown easily and it can be stored for up to a year after harvesting so that it remains on supermarket shelves. The trees are grown from dwarfing rootstock that lets farmers fit more than 1,000 to an acre, lined up neatly in rows. Today’s apple orchards bear little resemblance to the image in people’s minds.

Farmers can hardly be blamed for responding to the market in this way — they have limited choice, given consumer preferences and the buying strength of supermarkets. The Cosmic Crisp is perfectly adapted to what retailers and shoppers want, wrapped in a trademark to make it profitable.

In the future, the consumer could tire of what has been made for him and her — the unnerving consistency of fruits that always taste the same, with a crispness that takes months to fade.

They may miss their old quests for apples in season, and the unpredictable pleasures of the first bite. Until then, here is the Cosmic Crisp.

Uncertainty, Uncertainly, Uncertainty

by: The Heisenberg
Summary
 
- It's been 10 days since I last chatted with readers here. Spoiler alert: There's still no light at the end of the tunnel for the global economy.

- On the bright side, equities have managed to surge back near all-time highs, and I'm happy to give you some granular color on that.

- I'll bracket that with a 30,000-foot view on the global outlook and a 10,000-foot view (if you will) from the executive suite stateside.
 
 
The last time I chatted with readers here was on - checks notes, because it seems like a lifetime ago - October 14, in a piece called "Stephanie Kelton For President."
 
In that post (which Stephanie tweeted with a blushing emoji), I noted that expectations for global growth have continued to deteriorate in the face of record-high policy uncertainty and the seemingly intractable trade war between the world's two largest economies.
 
After citing the latest forecast cuts from the IMF and the OECD, I drew your attention to the latest edition of BofA's FX and rates sentiment survey.
 
When asked to choose from a variety of statements regarding the prospects for the flagging global economy, the 57 fund managers (who together control more than $800 billion in AUM) overwhelmingly chose "The global uncertainty shock has been so persistent that lasting damage has been done and policy action will be too little, too late."
 
In the 10 days since, there's been no shortage of fresh data to support the contention that the global economy continues to decelerate. There's been some decent news sprinkled in with the bad, but no top-tier data that I'm aware of (and I'm aware of pretty much everything) suggests there's a light at the end of this tunnel.
 
Allow me to just run through a few of the more worrying points, in no particular order. Some of these readers will be well apprised of, and others maybe not so much.
 
Most obviously, China reported the slowest quarterly GDP growth in some three decades last week.
 
The world's second-largest economy expanded 6% in the third quarter, below expectations (consensus was 6.1%).
(Heisenberg)
 
 
September activity data (released concurrently) was generally better than expected, but that's not saying much.
 
For example, industrial output rose 5.8% last month, which sounds good versus consensus (4.9%), but has to be considered in context - August's 4.4% print was a 17-year low.
 
The raft of Chinese data out last week also included September trade numbers which found exports falling 3.2% and imports plunging 8.5%.
 
That latter figure suggests domestic demand is flagging in the face of the trade tensions.
 
As I noted elsewhere last Friday, a larger Chinese surplus due to flagging imports is the worst-case scenario from a global perspective - it effectively means the country is exerting downward pressure on already subdued global demand.
 
At the same time, the stimulus out of Beijing continues to come in dribs and drabs. The PBoC injected $28 billion in medium-term funds last week ahead of the GDP numbers, but when the third vintage of the revamped loan prime rate was released on Monday, it was unchanged from September.
 
Beijing implemented a broad RRR cut last month, and targeted cuts on October 15 and November 15, ostensibly help. But the pace of stimulus (both monetary and fiscal) has been maddeningly slow for those betting on Beijing to rescue the global cycle.
 
One notable chart in the context of the above shows sales of sedans, minivans and SUVs in China falling for 15 of the last 16 months. Deep discounts prompted one month of respite over the summer, but that’s it.
 
(Heisenberg)
 
Data out of other countries tells a similar story.
 
Bellwether South Korea, for instance, delivered another egregious first-20-day exports print on Monday.
 
Shipments in the first three weeks of October plunged 19.5% from the previous year, putting the country on track for an eleventh straight month of contracting exports.
 
Have a look at this:
 
(Heisenberg)
 
 
With apologies for the hyperbole, that is just plain, old horrible. Earlier this month, the BoK cut rates for the second time this year and although the bank did an admirable job of getting out ahead of things when it came to preparing the market for what, hopefully, will be just a brief trip below zero for consumer prices, it is nevertheless disconcerting that South Korea is now in deflation for the first time in recorded history.
 
(Heisenberg)
 
 
Moving on to Germany, most readers likely know the story there.
 
The world's fourth-largest economy almost surely entered a technical recession in the third quarter and thus far, Berlin has stuck to its guns when it comes to fiscal rectitude.
 
Rumblings about deficit-funded stimulus are getting louder, but so are the cries that by the time it comes, it will be too late.
 
On Thursday, flash PMIs for Germany betrayed a slight improvement from September, but the manufacturing slump is deep and entrenched.
 
 
(Heisenberg)
 
Earlier this month, the German Economy Ministry slashed its growth outlook for 2020 to just 1% from 1.5% previously.
 
And I could go on.
 
Again, there are green shoots here and there (and if you ignore the employment subindexes, Thursday's Markit PMIs for the US weren't too bad), but the overall picture is clear. BofA described it in stark terms in a recent note.
 
To wit, from a piece out earlier this month:
Secular stagnation has now become our baseline. Growth is slowing in almost all major economies, in some cases from already low levels. Trade deals are only likely to avoid further tariff increases, at least for now, while keeping the tariffs of the last two years in place. Political uncertainty in the US is likely to increase ahead of the elections next year. We see increasing evidence that monetary policy has become ineffective, accumulating negative side effects. Fiscal policy is not coming to the rescue, and in any case, very few major economies could afford it. Structural reforms remain a theoretical and unpopular concept for most governments. Having to fight increasing populism, mainstream governments have often become reluctant to push for much needed reforms. Tight labor markets, in any case, suggest capacity constraints. Increasing wages without inflation also point to risks for profits.
 
In the first linked post above (the Kelton piece), I suggested that MMT-like policies are almost surely in the offing, as they are popular (in one variant or another) among populists on both sides of the political spectrum. Right-wing populists aren't likely to embrace Modern Monetary Theory by name, but they will (and, indeed, they already have in the US) in practice.
 
Of course, none of this has stopped US equities from scaling close to new highs in October.
If you wanted to explain the mid-month "melt-up" in US stocks highlighted in the visual below, it wouldn't be very difficult.
 
For weeks, folks had been "long" worst-case scenario expressions and "short" good news, a thesis which eventually collided head-on with two macro catalysts in the "Phase One" Sino-US trade "deal" and unexpected progress towards a Brexit agreement.
(Heisenberg)
 
 
Leaving aside the nebulous nature of the former and the fact that the latter is still hanging in the balance (Boris Johnson is now angling for a December 12 election in the event he can't get his Brexit deal crammed through by November 6), movement on both trade and Brexit hit amid heavily lopsided positioning (dealers had hedged what they were short to clients in terms of crash protection).
 
"The dealer 'crash' hedge purge as the flow catalyst into the monthly 'Gamma Event' that is expiration has been a second-order slingshot for stocks over the past week-and-a-half," Nomura's Charlie McElligott wrote late last week, adding the following crucial color on the mechanical catalysts behind the move:
This multi-day rebalancing out of front and into the 2nd contract by Wednesday—on top of Dealers puking a meaningful amount of the VIX upside / VIX futures exposure which they had to buy in order to hedge the “Oct Call Wing” buyer flow that they were short to clients and each other—is the real “how and why” of this rally and the stickiness of Stocks holding “higher,” despite the constant complaints from those who believe we should be lower for “fundamental” reasons.
That's from a note dated Friday, October 18 (I emphasize that so readers have a reference point for his mention of "Wednesday" and "the past week-and-a-half").
 
There's a tactical trade coming out of that, which I don't want to delve into in any great detail for fear of encouraging readers to attempt things they probably have no business attempting.
 
But, in the interest of adding a bit of additional color to the above, I will give you a brief quote from McElligott's latest note (dated Wednesday) which captures the thrust of it:

As I referenced last week with the VIX “knee-capping” we’d been calling-for into expiry (which then drove a massive steepening of the VIX futures curve, as longer-dated stays “bid” against VIX ETN rebalancers SMASHING front-month thx to the contract roll), the trick is that this ETN rebalancing impact on “lower VIX into expiry / settlement” then marks a “local low” which tends to see a 1) higher VIX- and 2) VIX curve flattening- (or even inversion) impulse thereafter.
Meanwhile, equities are now pinned, as it were.
 
(Nomura)
 
 
Trudging out of the deep weeds and panning quickly back to a 10,000-foot view (but not quite to the 30,000-foot level we started from here at the outset), CEO confidence in the US has plunged to crisis-era levels (left pane below).
 
That, in turn, has weighed heavily on cash spending, which dove double-digits in the second quarter of 2019, after hitting records the previous year.
 
(Goldman)
 
 
Behind plunging executive confidence is rampant uncertainty, attributable in part to trade tensions.
 
Here's Goldman (NYSE:GS), from a note dated October 17:
Companies spend less cash when policy uncertainty is high. Historically, growth in aggregate S&P 500 cash spending has been weaker during periods of high policy uncertainty. The combination of an ongoing trade conflict and next year’s US presidential election will likely result in lingering uncertainty.
 
The outlook for cash spending isn't great, although it's not terrible either. The year-ahead numbers are, of course, just projections, but the rationale behind them (i.e., the self-evident notion that more uncertainty makes management teams less willing to spend) and the fact that the 2019 estimates reflect some numbers that are already on the board (e.g., the steep drop-off in Q2 shown in Exhibit 3 above) make them well worth highlighting:
We estimate cash spending will fall by 6% during 2019 before rising by a modest 2% during 2020. S&P 500 cash spending rose by 5% during 1Q, but plunged by 13% yoy during 2Q. During 2019, the decline in spending will be driven by a 20% drop in cash M&A and a 15% fall in buybacks. In 2020, we expect modest growth in capex (+3%), R&D (+6%), dividends (+5%), and cash M&A (+6%) will be partially offset by a 5% decline in share repurchases.
 
 
Note that Goldman sees gross buybacks falling 5% in 2020. The bank cites dramatically lower cash balances, sluggish earnings growth and political scrutiny of corporate cash usage as factors likely to weigh on management teams’ capacity and willingness to buy back shares.
 
Obviously, buybacks have supported US equities over the past several years. Good people can debate the extent to which that support has been responsible for rescuing the market during acute downturns and smart investors can argue about how much share repurchases actually matter when it comes to inflating corporate bottom lines and thereby share prices. What isn't debatable, though, is that buybacks do have an impact and they are set to wane going forward.
 
Taken as a whole, all of the above suggests that from a macro perspective, the only three words that matter are "uncertainty," "uncertainty" and "uncertainty."
 
And don't let anyone try to use the old "there's always uncertainty" line on you, if the goal is to somehow trivialize just how indeterminate things are. For one thing, many of the readily accessible non-market-based measures of uncertainty at our disposal are sitting at or near all-time highs. The EPU is one example (there all manner of variations which you can access here).
(Goldman, EPU)
 
 
 
Beyond that, common sense tells you that these are particularly trying times. Just watching the news is enough to stress the average investor out. Imagine if you were a CEO.
 
In addition to the trade frictions, the ongoing impeachment inquiry in D.C. is now highly relevant for investors and corporate America. Donald Trump will almost surely be impeached by the House. That is just an objective assessment. If you don't believe pundits and historians or you can't do the math yourself, just ask the crowd (i.e., just look it up on PredicIt here).
 
The real problem, though, is that the Syria debacle raises the odds of a Senate conviction from zero previously to a number higher than zero, even if that number is still infinitesimal.
 
When you throw in the fact that Elizabeth Warren is just as likely as not to beat out Joe Biden for the Democratic nomination, the level of political angst among professional investors, and certainty among CEOs and CFOs, is very elevated, even if the average investor is more insulated from all of this by virtue of not having as much to lose.
 
Although nobody knows what's coming, we do know what people would like to see to alleviate some of their concerns.
 
For one thing, the trade war needs to end - like, yesterday. As is the case with Brexit, the market is exhausted with trade headlines.
 
And yet, it appears as though the Trump administration and China are set to do this dance for years as multiple "phases" of a prospective agreement materialize at unpredictable intervals.
 
Just Thursday, Bloomberg reported that China may be willing to buy $20 billion in US farm goods during year one, as part of "Phase One," but will only hit the $40 to $50 billion figure cited by President Trump in year two, under Phase 2 (or 3), when tariff relief is expected.
 
Underscoring the extent to which this has become something of a hamster wheel is the following chart which shows that if China does ramp farm purchases back up to $20 billion, that will only get us back to levels seen in 2017, before the trade war started. So, all of this for what, exactly?
(Heisenberg)
 
 
The other thing that has to happen for the outlook to improve materially is that somebody (where that means either China or Germany) needs to step on the fiscal gas pedal.
 
As outlined above, it seems like we are some way away from seeing Beijing and/or Berlin embark on an aggressive, "kitchen sink" stimulus push.
 
The longer that takes, the more vulnerable the world will be to negative headlines, especially those with a direct connection to the global economy.
 
And with that, I'll leave you with two passages and two charts from the October edition of BofA's closely-watched Global Fund Manager Survey. To wit:

Ongoing bearishness about the prospect of a trade war resolution: note 43% of FMS investors think the US-China trade war is the new normal vs. 36% who think we will see a resolution before the 2020 US Presidential election. 

   
Aside from the end of the trade war (#1 FMS “tail risk”) FMS investors think a German fiscal stimulus package, a 50bp cut by the Fed or a Chinese infrastructure package would be the most bullish for risk assets over the next 6 months.
(BofA)

China’s Property Bond Boom Clashes With Housing Market Realities

Issuance of bonds by real-estate developers has surged, but a weakening property market make them poor bets

By Mike Bird


A residential construction site in Hong Kong. Property developers in Hong Kong and mainland China make up almost half of Asia’s high-yield-bond market. Photo: Paul Yeung/Bloomberg News


China’s property developers have used falling U.S. interest rates this year to issue swaths of dollar debt. Yet the state of the country’s housing market—now past its prime—suggests investors would do well to steer clear.

Developers in Hong Kong and mainland China account for 41% of the net issuance in Asian dollar-denominated bonds included in the ICE Bank of America Merrill Lynch Asian Dollar index this year, rising to 67% in the high-yield segment, where they now make up almost half of the total market.

Even investors who haven’t opted to take direct exposure to the sector may now find it creeping into their portfolios: 14.1% of the same broad Asian Dollar Index is now made up of Chinese and Hong Kong property bonds, up from 11.2% at the end of 2018.




The two largest contributions come from China Evergrande Group,which alone has issued this year around $15 billion in bonds rated by Moody’s Investors Service, and Sunac China Holdings Ltd., which has issued around $6 billion. Sunac was given the lowest relative rating against 14 of its peers based on its financial results during the first half of 2019 by bond researchers at CreditSights.

Average yields on high-yield Chinese bonds broadly have fallen considerably this year, to around 8.4% from a high of 11.7% as recently as November 2018, according to the ICE Bank of America Merrill Lynch Asian Dollar index. Even Kaisa Group Holdings Ltd., which defaulted on dollar bonds in 2015, saw strong demand for $400 million in issuance last week, at a yield of 12.25%.

Developers have levered up in other ways as well this year: presales of housing, which act as a shadow funding mechanism for property companies, have boomed even as completions of housing have been lackluster.

This is difficult to square with what is actually happening in the housing market. Data released this week showed that house prices in the 70 cities monitored by China’s National Bureau of Statistics rose by 8.6% in the 12 months to September, the slowest pace in a little over a year. Of those 70 cities, 12 reported price declines, the highest number since February 2018.

Those are hardly figures to send investors hiding under their mattresses, but it is difficult to see how the sector would return to more frenetic activity.

The central government’s reticence to pursue a broader stimulus this year has been based in no small part on a reluctance to allow credit to flood the housing market, as it did after the wave of 2016 stimulus, when household debt growth doubled.

Several cities have undertaken more restrictive real estate policies in recent months, including limits on nonresident purchases, price caps and preventing developers from converting commercial to residential land.

The case for Chinese property debt at their current prices is feeble enough, even before considering that foreign investors are at the bottom of the pile as far as the Chinese government’s priorities go.

If Beijing is ever faced with the choice of satisfying local buyers waiting for their houses, Chinese banks, or overseas bondholders, it won’t be a difficult choice to make.

The Enchantment of Mutually Assured Destruction

By George Friedman


One of the most extraordinary facts of history is that during the Cold War the United States and the Soviet Union never launched a war against each other. They probed and prodded on the edges of war, but it never rose to its logical conclusion: nuclear war. When we consider the sophisticated statesmen of 1914 and 1939 who led Europe into catastrophe, it is the world’s good fortune that they were not the ones managing the Cold War. Rather it was being managed by the United States and the Soviet Union, who were meticulously and obsessively careful to avoid war. The irony is that many Europeans tend to regard Americans as cowboys and the Russians as barbarians, and themselves as sophisticated and cautious. Yet it was the European gentlemen who hurled themselves into wars of slaughter, while the cowboys and barbarians did everything they could to avoid war. This is an important point I like to make, especially in meetings with Europeans.

There was of course a fundamental difference between the two world wars and the one that never happened. The Europeans believed that these wars would be contained. The French in 1914 did not appreciate what the machine gun could do. The Germans didn’t appreciate what massed bombers could do in 1939. This was a failure of imagination. There could be no failure of imagination about nuclear weapons. If anything, imagination was insufficient to grasp what they would do. The Europeans should have known what machine guns and bombers could do, but they didn’t. The Americans and Russians could not evade the truth.

Still, each nation had to survive, and to survive it had to know the unknowable: what the real intention was on the other side. In war, surprise with overwhelming forces is the dream. Not knowing your enemy’s intent is the nightmare. Barring information to the contrary, each side should have struck first and fast. That neither side did was not due to their virtue. It was due to the fact that the Soviets in the 1950s could not have launched a massive first strike at the U.S., and therefore the U.S. did not strike either. “Dr. Strangelove” was nonsense intended to depict the thoughtful and careful political and military leaders as demented. They weren’t.

In due course the Soviets developed a first-strike capability, and that was the moment of danger. Whoever struck first, with massive surprise, would survive. The other would not. Wars sometimes arise out of lack of imagination. A nuclear exchange would arise out of a lack of knowledge – not knowing what the other side was capable of, and not knowing each intended, but knowing that if the enemy struck first, he would survive.

What prevented nuclear war was mutual assured destruction. So long as each side understood that an attack would trigger an equal response, war was avoided. The only way to guarantee that was to make certain that each side was aware of the other’s capabilities, and that each side could detect an attack with enough time to respond. By maximizing intelligence and minimizing the probability of surprise, the risk of attacking was overwhelmed by the probability of an equal counterattack. There are those who regarded mutual assured destruction as madness. I have never understood why. We are humans and we go to war, but this war was avoided.

Of Aristotle’s virtues, it was prudence that governed. But prudence could have also dictated a first strike. Prudence was redefined by technology. The Soviets focused on constructing a missile force. As a spinoff of the missile force, they launched a satellite, Sputnik, into low-Earth orbit. The Americans were galvanized to do the same, but propaganda aside, creating satellites opened the door to a prudence of peace. A few years after the first demonstration satellites were launched, so were reconnaissance satellites, which would observe and target enemy missile bases, and years later, satellites that could detect the heat of a missile launch. The satellites made it possible to know the enemy’s capabilities and detect a missile attack with enough warning that a counterattack was possible. No one was really certain that their own or the other side’s systems would work, but no one was certain they wouldn’t. The probability of a one-sided victory through surprise shrank, and prudence dictated avoiding any action that might frighten the other side. The Cold War evolved into a political, or low-intensity, conflict, rather than catastrophe. And the leaders of both sides were shaped to be masters at pressing an advantage without excessively frightening the adversary.

After World War I, intellectuals sought to understand the origin of war in the human psyche, which is what the sophisticated called the soul. Men in particular possess within themselves a rage that, when unleashed, can be satisfied only by violence. They also possess a fear not only of death or harm, but of shame in defeat, or worse, fleeing the battlefield. There is nothing original in this, as Homer wrote about it. The followers of Sigmund Freud sought this dichotomy in the subconscious rage against the primal father. In doing this, they turned war into a compulsion, a necessary part not of history or society but of the very souls of men. The rage would in the end overwhelm fear, and brush aside prudence. I myself learned about this in school at PS 67 in the Bronx, when I insisted on fighting Hector in spite of the fact that he had crushed and would again crush me.

But in the Cold War, and in the satellites both sides launched, we find that reality can impose a prudence that overwhelms the primal rage in men. From space, we could see the enemy and the enemy could see us. Whatever our rage at each other, it could be tempered by prudence. The idea that war is the result of a need so deep it cannot be controlled was shown to be false. The need for war may well exist, but it does not rule.

Space was the sphere that made the war impossible. If you will recall my earlier discussion of enchantment, my detour into space is intended to bring us back to that theme. In much of the world, heaven, or space, is the realm of peace and redemption. It is an enchanted place. The fact that we avoided annihilating each other was not to be found in our souls, which were filled with the rage that haunts us all. Rather it was the fact that we humans, using space, changed the equation between rage and fear. Before World War I and World War II, rage overwhelmed fear, and prudence argued for war. The Cold War remained cold because the logic of technology, and the existence of the heavens, dampened the soul of the angriest warriors. Many died in lesser wars, but our two nations survived. That was quite enough of an achievement in the 20th century.

I am not trying to make enchantment mystical; I am trying to demystify it. But at the same time, those astronauts of all nations who have gone into space have testified to an awesome beauty that was beyond their ability to express. The word they never used was enchantment. It is a sphere that has been the realm of gods, a place where a higher law governs. It has struck me many times that while we have come to think of space as prosaic, as the realm of technicians and budgets, it is enchanting for two reasons. First, it is enchanting because it is beautiful and our bodies float in violation of all laws we know. Second, it is enchanting because it rendered impossible a war that should by all rights have been fought.

There are many technical reasons, but we should stop and consider how extraordinary it is that heaven imposed prudence on the rage Freud wrote of. Whether it can continue to do so is a question for later, but it is extraordinary that the sphere that we had entered for the first time, because of the Cold War, was the place which made that war impossible.

Hence there is a connection among my ramblings, although I am still poking at it uncertainly.