The Military Spending Bubble
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This bubble rivals the housing bubble. Half a trillion a year for the last four years is being lavished on American corporations and is paid for nearly 100% by foreign banks buying American Federal debt. According to Jane's Defence
US defence budget will equal ROW combined "within 12 months"
By Guy Anderson Editor of Jane's Defence Industry
Defence expenditure in the US will equal that of the rest of the world combined within 12 months, making it "increasingly pressing" for European contractors to develop a "closer association" with the US, corporate finance group PricewaterhouseCoopers (PwC) says.
Its report - 'The Defence Industry in the 21st Century' by PwC's global aerospace and defence leader Richard Hooke - adds that "the US is in the driving seat", raising the prospect of a future scenario in which it could "dominate the supply of the world's arms completely".
Daddy Warbucks is in the driving seat of a car jointly owned by the Chinese and Japanese banks. And Daddy Warbucks intends to pay for the gas by using it to rob gas stations.
The US defence budget reached US$417.4 billion in 2003 - 46 per cent of the global total.
Less than two per cent of the US defence budget is spent outside its home market, the report notes, and of this around one per cent goes to UK contractors.
Hooke says: "The message for management teams in all this - apart from the obvious for US contractors to monopolise the industry - is that they will fail to maximise value if they fail to define accurately the business segment in which they operate.
"For Europe and the UK in particular, it means, right now, an increasingly pressing need to develop a closer association with the US market."
The budget isn't $417.4 billion, this leaves out the $100 billion a year for holding up the Iraqi gas station where we are involved in a very bloody shoot out. This reminds me of the 1980s when Russia and America were in an arms race. 80% of the money spent on military toys and people literally drove Russia into bankruptcy. They were reduced to begging us for food aid starting in the late seventies as I recall. Now that they have withdrawn from this ridiculous wasteful race their economy is slowly recovering. Many Russians suffered terribly when the country went belly up.
It is interesting the insanity here. Jane's is an European publication and they seem to think America has tons of military money to toss around. They think we are in the driver's seat. Well, hate to say this, we are driving off the cliff.