Daily Archives: 6 July 2017

Russia and the PRC Propose

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Recall that northern Korea has just tested a missile it’s representing as an intercontinental range missile (and the missile’s flight profile suggests that it can reach Anchorage).  Northern Korea also has a potful of shorter-range missiles that easily can hit the Republic of Korea and Japan and most of our bases in the Western Pacific, including in those nations.  Russia and the People’s Republic of China have a proposal to resolve the matter.

[T]he Chinese and Russian foreign ministries proposed that North Korea declare a moratorium on nuclear and missile tests while the United States and South Korea refrain from large-scale joint military exercises.

This is just cynical.  In return for the US and the Republic of Korea stopping training to defend ourselves against attack, northern Korea would be allowed to retain, intact, its nuclear weapons facilities.

Sure.

Bank Bailout, Italian Style

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Italy has nationalized Monte dei Paschi di Siena, a major bank that otherwise would have gone into bankruptcy. In the process, the bank’s €26.8 billion ($32.5 billion) “nonperforming loans” will be “disposed of,” and the Italian government taxpayers will feed the bank €5.4 billion and get a 70% stake in the failing bank.

Under the bad loan disposal plan, €26.1 billion will be bundled and sold at 21% of gross book value, the vast majority to the government-organized Atlante II fund, while the bank retains 5%.

This is the third time Monte dei Paschi had gotten capital injections, and for some reason, the men of the Italian government thinks this third time will be the charm.  Of course, that’s an easy choice for them to make; it’s not their money being used in this risk.  It’s the Italian taxpayers’ money being cavalierly gambled.

No, instead the bank’s creditors and other investors should be the only ones on the hook; they’re the ones whose money is at stake, and they’re the ones whose management oversight was…absent.