Trump and the Saudis grow even more isolated

[Bloomberg]( Today’s Agenda - In the Khashoggi controversy, will Trump follow the [money](, or [morals](? - The Trump administration is [still lying]( about its family-separation policy. - Trump may not like it, but the economy wouldn’t be the same [without California](. - Google has [outsmarted]( European [regulators](. - Trump does [something smart]( in the trade war. The Crux of the Khashoggi Controversy Nobody knows how the controversy over Jamal Khashoggi’s disappearance and apparent death will end. But as with so many other situations, it might help to follow the money. President Donald Trump has been loath to blame Saudi Arabia for Khashoggi’s death, despite mounting evidence and pressure to do so. One primary reservation seems to involve money; Trump has said he doesn’t want to endanger a $110 billion “or whatever” sale of military equipment (which may [not be a real thing]( anyway). And as Tim O’Brien writes, Trump may have other financial concerns: namely his own. Though Trump has denied having Saudi “interests” (strangely not producing tax returns as evidence), Tim recounts how [Saudi cash has repeatedly enriched the president]( and Jared Kushner. If Trump insists on covering for the Saudis, then it may be because he “stubbornly put money ahead of the moral and diplomatic issues at play,” Tim writes. Read the [whole thing](. There could also be a realpolitik explanation for Trump’s behavior. As Eli Lake writes, Saudi Arabia is a key ally against Iran. But its de facto ruler, Crown Prince Mohammed [bin Salman, keeps making terrible decisions](, even if he didn’t order Khashoggi’s death. That raises questions about his usefulness as an ally. Helping him push an obviously false cover story may [do the U.S. no good]( in the long run, Eli writes. Of course, lots of countries and companies have financial incentive to go easy on Saudi Arabia. Its [trillions in sovereign-wealth dollars]( were a big selling point for the “Davos in the Desert” conference so many attendees are bailing on now, notes Mihir Sharma. Saudi cash, and the oil behind it, are [inextricable from the global economy](. Still, Bobby Ghosh writes, if overwhelming evidence – say, recordings of Khashoggi’s torture and murder, which the Turkish government [claims to have]( – doesn’t force Trump to hold the Saudis accountable, then the [rest of the world will](. The Lingering Immigrant-Kid Crisis Approximately 100 years ago, back in June, the Trump administration’s policy of separating migrant families at the U.S. border was a big controversy for a week or two, leading to protest marches, lawsuits and a halting effort to solve the problem. It has [not really been solved](. Though most families have been reunited, hundreds of children are still cut off from their families, possibly permanently, and possibly having lived in unconscionable conditions for far too long. And yet the Trump administration is still defending – and even thinking of reviving – this policy, “steeped in bad faith,” by lying about it, Bloomberg’s editors write. That suggests [no one will ever be held accountable](. Trump Would Be Sorry Without California Trump is no fan of the blue states – particularly not California, the bluest state of all, “a center of both internationalist business attitudes and anti-Trump political sentiment,” as Matthew Winkler puts it. And yet this state, with its strict regulations and high taxes and Dianne Feinstein, is also [the engine driving the economic boom]( Trump likes to brag about so much. Without California’s production, Matt writes, the U.S. stock market is nothing special and the economy is barely more dynamic than the euro zone. The euro zone! Read the [whole thing](. Google Outsmarts Europe Google just used some jiu-jitsu on the European Commission. Ordered by European antitrust regulators to stop encouraging phone-makers to pre-load Google apps for free on their phones, Google said fine and … made phone-makers pay for the privilege of putting its apps on their phones. This was probably not the outcome regulators envisioned. But as Bloomberg’s editors write, the EC [waited way too long to try to stop Google]( and then came at it clumsily. As Shira Ovide writes, Google got the benefit of getting everybody hooked on its free apps, and now it will [get the benefit of making addicted customers pay]( for said apps. Great job, everyone. Trump’s Smart Trade-War Move After months of threatening allies and levying self-defeating tariffs, the Trump administration has finally done something smart in what has generally been a dumb trade war: It announced plans to leave a 144-year-old postal treaty that lets China mail stuff to the U.S. at rock-bottom rates. Brooke Sutherland writes this is a [surprisingly sensible step](, ending what had been an obviously unfair advantage for China and a hindrance to U.S. companies. “For once, his tendency to play with matches [just might pay off](,” Brooke writes. Another smart thing for Trump to do to top China in the trade war is to [rejoin the Trans-Pacific Partnership](, writes Noah Smith. The U.S. needs all the allies it can get, the TPP provides a ready roster of those; and Trump has already shown he’s willing to lightly update and rebrand a trade deal and call it a win. [This could be a big one](. Charty McChartface There’s plenty of gasoline out there, but not enough to offset Middle East tensions and [bring pump prices down]( ahead of the midterm elections, writes Liam Denning (with this chart from Elaine He). Netflix might some day have to [reckon with its cash-burning ways](, but not today – subscriber growth is still strong, and that’s all investors care about now, writes Tara Lachapelle. This is kind of a [scary stock-market chart]( from John Authers, whose [new newsletter]( can terrify your inbox every day, if you want. Quick Hits Emerging markets are unfairly being beaten about by choices overseas, but [they can limit the damage]( if they’re smart. – Dan Moss The U.S. should [sell grain to Iran](. – Esfandyar Batmanghelidj Greece needs more drastic measures to deal with its [ongoing banking crisis](; its gradual approach so far isn’t working.  – Ferdinando Giugliano Europe still isn’t doing enough to [fight money-laundering](. – Leonid Bershidsky Ballooning state spending on health care is [crowding out spending on public colleges](, which is leading to their slow decline. – Peter Orszag Expats deserve their [own special political representation](. – Leonid Bershidsky ICYMI The [student-loan crisis]( is about to get worse. The Fed is [committed to raising rates](. Robert Mueller might [release key Russia-probe findings]( after the midterms. The GOP believes those midterms will be [all about Trump](. Kickers Your table salt may well include [microplastics](. What's weirder than extraterrestrials? [Try endoterrestrials]( – tiny creatures that live inside the earth’s rock. Our solar system is [not like most other solar systems](. We may soon find out whether black holes are [really dark-energy stars](. Security seals protecting voting machines can be [defeated by a soda can](. A California beach town may [retreat from the beach](. The original “Night of the Living Dead” is [coming back to theaters](. Note: Please send salt, suggestions and kicker ideas to Mark Gongloff at mgongloff1@bloomberg.net. Bloomberg Ideas On Oct. 25, Bloomberg Opinion columnists will participate in three long-form discussions, bringing their unique perspectives on technology, finance, politics, law, business and economics. They’ll cover topics central to the tech industry: how government should (or shouldn’t) regulate tech, the economics of AI, and the state of cryptocurrencies. 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