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Friday, March 31, 2006

Swonk: The bombing starts in eight months 

I attended an investment conference yesterday in Dayton, Ohio. Investors don't like talking politics much, but one cannot look at financial markets in a bubble; geopolitical issues and domestic politics are often discussed at these types of events, at least in passing.

Nevertheless, I was surprised to hear Diane Swonk, the Chief Economist at Mesirow Financial say the following to room of more than 1000 people (mostly MBA candidates):

"We're going to hit Iran. We are currently selling Israel 5 planes a month. They've got about 40, and will need 60, five squadrons, to help us complete the mission which will be a joint effort. It will begin the week after the US mid-term elections." (paraphrased from my notes.)

This topic came up in the context of a question regarding whether or not the US would put pressure on China to change their exchange rates. Her answer was no, because the US will need China's support in executing the Iranian mission, which she described as above.

This is a pretty provocative thing for anyone to say, but from an economist? Economists are usually quite careful with their predictions, always hedging with contingencies, variables, and assumptions. And yet here she was predicting without qualification not only the action that will occur, but the week in which it would occur! It was one of the more interesting things I heard all day. Certainly it will be worth seeing whether her prediction comes to pass, and if it does, we're going to have to pay closer attention to the writings of Diane Swonk.

(Later in the day, self-described "adventure capitalist" Jim Rogers was asked what he would do his first day if he were Chairman of the Fed. Without hesitation he said he would "close down the Fed and resign." All in all it was a pretty amusing conference.)

5 Comments:

By Blogger Dunk, at Fri Mar 31, 04:50:00 PM:

Correct me if I am wrong, but is not Swonk fairly liberal in her views. Probably a mild case of Bush derangement syndrom. By the way, what did she say about the FASB pension rule?  

By Blogger Charlottesvillain, at Fri Mar 31, 04:57:00 PM:

I don't remember FASB coming up. As for Swonk's politics, I am not familier with her general leanings, so you know better than I.  

By Blogger Dawnfire82, at Fri Mar 31, 07:30:00 PM:

40 aircraft? Israel had 196 *attack* aircraft in 1967.

http://en.wikipedia.org/wiki/Operation_Red_Sheet

The US wouldn't conduct an overt joint strike with Israel anyway, for political reasons.  

By Blogger Dylan, at Sat Apr 01, 10:49:00 AM:

Israel has very few that can reach Iran even with aerial refueling, however. The last time I read about possible Israeli plans to bomb Iran they included seizing an eastern Syrian airbase with paratroopers(!) to allow the returning strike to land and refuel on the return leg. I assume the 40 refers to some upgraded F-15 variant with the latest technology for maximum bombing effectiveness and range.  

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