Mish's Global Economic Trend Analysis |
- Spain's Latest Bad-Bank, Non-Bank, Shell-Game Proposal; Can One-Winged Pigs Fly?
- Showdown in Europe: Hollande Takes on Merkel and Draghi, Insists on Renegotiation of Merkozy Treaty; Does It Matter Whether France Signs?
- "Flying Piano" Costs Pentagon $1.5 Trillion
Spain's Latest Bad-Bank, Non-Bank, Shell-Game Proposal; Can One-Winged Pigs Fly? Posted: 29 Apr 2012 11:13 PM PDT Spain has floated a number of bad-bank proposals recently, all of which were fundamentally flawed and doomed from the start. The latest shell-game proposal will supposedly take bank assets, put them in a non-bank, while forcing the banks to come up with sufficient capital to cover losses. Please consider Spain in Talks Over 'Bad Bank' Scheme Spain's government and its banks are discussing a new scheme to segregate problematic property loans into one or more asset management companies to relieve the burden on struggling lenders, according to officials and bankers.Can One-Winged Pigs Fly? If banks have sufficient loan-loss reserves then why don't they simply take the losses now? If they can raise capital now, then why don't they? If they cannot raise capital now, how will will they be able to do so in the process of moving the assets to a non-bank bank? This ludicrous plan has the flight capability of a one-winged pig. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List |
Posted: 29 Apr 2012 08:09 PM PDT German chancellor Angela Merkel says the Merkozy treaty is not renegotiable. There is just one "slight" hitch: France has not signed the treaty and will not sign the treaty unless it is reworked says François Hollande who on May 6 will in all likelihood replace Nicolas Sarkozy as president of France. Moreover, Hollande's demands have gotten steeper and steeper as he inches closer to election. Please consider Hollande rebukes Berlin over crisis role François Hollande, the Socialist candidate for the French presidency, has claimed support from across Europe for his demand for a growth plan, saying it was not up to Germany to decide what action should be taken in the face of the eurozone crisis.Election Posturing? Many think this Hollande's antics are nothing but election posturing. I am not so sure. After all, what does Hollande have to lose by holding out? One thing is for sure, and that is eurobonds are not going to fly. Germany will not approve. Will Hollande settle for some meaningless "growth package"? Does it Matter What France Does? Short-term, the squabbles and finger-pointing will be far more entertaining if France refuses to sign the treaty. However, given the pathetic state of affairs in Greece, Spain, and Portugal, I fail to see why it really matters in the long-term whether France signs or not. The Eurozone will not last as-is in either case. That said, the bigger and deeper the squabbles, the sooner Germany many do the right thing for all involved: exit the Eurozone before it splinters led by the Club-Med countries. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List |
"Flying Piano" Costs Pentagon $1.5 Trillion Posted: 29 Apr 2012 10:08 AM PDT The Pentagon is about to waste $1.5 trillion, 38% of entire defense budget for a "virtual flying piano". That may sound preposterous, and it is. Unfortunately, it is also true. Foreign Policy Magazine discusses the sad saga of The Jet That Ate the Pentagon. This month, we learned that the Pentagon has increased the price tag for the F-35 by another $289 million -- just the latest in a long string of cost increases -- and that the program is expected to account for a whopping 38 percent of Pentagon procurement for defense programs, assuming its cost will grow no more.What Happened? You can actually blame president Clinton for this debacle. You can also blame every president since Clinton for stupid decisions upon stupid decisions and for not scrapping the program. The sad saga continues ... The design was born in the late 1980s in the Defense Advanced Research Projects Agency (DARPA), the Pentagon agency that has earned an undeserved reputation for astute innovation. It emerged as a proposal for a very short takeoff and vertical-landing aircraft (known as "STOVL") that would also be supersonic. This required an airframe design that -- simultaneously -- wanted to be short, even stumpy, and single-engine (STOVL), and also sleek, long, and with lots of excess power, usually with twin engines.The Dustbin Awaits Foreign Policy Magazine arrives at a rational conclusion: "There is only one thing to do with the F-35: Junk it. America's air forces deserve a much better aircraft, and the taxpayers deserve a much cheaper one. The dustbin awaits." Who supports the program? Defense Contractors Defense contractors are at the top of the list. For example, Lockheed Martin, Northrop Grumman, BAE Systems, and Pratt & Whitney support the F-35. Please consider this Lockheed Martin Propaganda. Establishing air superiority in today's complex global security climate requires the unprecedented capabilities and versatility that only the F-35 Lightning II can offer.To show you what incredible liars the defense industry has, Lockheed Martin has the gall to claim "economies of scale". Senator John McCain Supports the Boondoggle Senator John McCain wants F-35 training in Arizona at Luke Air Force Base. McCain was presented with the Wing Coin and Chairman's Award by Brig. Gen. Kurt Neubauer, 56th Fighter Wing Commander, and Charley Freericks, Chairman of Fighter Country Partnership's board of directors. The award was given in recognition of McCain being a champion of Luke during his years of public service.Spirit of Idaho The Spirit of Idaho organization hopes for training mission in Idaho. Idaho citizens are second to none in their enthusiastic support for the men and women of our Armed Forces and for their military missions. Hosting the F-35 Lightning II Joint Strike Fighter would be a great way to continue that tradition while helping to secure the future of Mountain Home Air Force Base and Gowen Field. That's to say nothing of the thousands of great jobs and economic opportunities that having the F-35s here would create. C.L. "BUTCH" OTTER, GOVERNORGreed, Graft, Public Unions In general, states where defense contractors are located, states that will house or train the pilots want the jobs support the F-35. Those states, and politicians in those states do not give a rat's ass about how inept or costly the program is. The greed, graft, and waste are bad enough as it is. However, no amount of greed, gall, and waste is so great that unions will be satisfied with it. Please consider Lockheed F-35 workers ready for long strike, union says Unionized workers on strike against Lockheed Martin Corp (LMT.N) over healthcare benefits and pensions are prepared for a long work stoppage, a top union official said on Tuesday as the company said it would be able to keep operations running.The F-35 program deserves to be scrapped because of cost overruns, inept design specs, and poor test results. Yet 3,650 union ingrates were arrogant enough to walk off the job demanding still more money to build this boondoggle. Every last one of them deserves to lose their job permanently. Let's hope this is the final straw that kills the program. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List |
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