- EUROPE, IRAN, NORTH KOREA & ANTI-SEMITISM -

The United States of Europe (USE or EU) is expected to promote Italian PM Berlusconi to the position of President in the next few weeks.  The post is rotated biannually until determination of the draft constitution, hopefully in 2004, which is expected to make European President an elected position.

The draft constitution of USE makes provision for citizen initiation of legislation, but appears to allow politicians to veto the proposed legislation, (unlike similar citizen powers in about half of the states of the USA, where the politicians have no veto).

The wealthiest states (Norway & Switzerland) do not seem particularly interested in joining.  The UK has reservations about majority voting on foreign & taxation policy.

The world has entered a new and very dangerous phase.   The new generation of world leaders has not experienced the horrors of total war.

The French have taken Iranian refugees prisoner, in an apparent show of support for the Mullahs.  It was the French who gave sanctuary to the revolutionary Khomeni when the Shah ruled Iran. 

The Iranians are opening an Uranium enrichment plant.  Enrichment capability is a prerequisite to independent production of nuclear weapons.

The USA has warned Iran that it will not tolerate development of nuclear weapons.

If I was an alien & didn't know better, I would think that the emerging state of US of Europe (Less Eastern Soviet States) was at war with the USA. (or at least the French & maybe the German part of USE).

Due to it's burgeoning beaurocracy, the USE has a stagnant or shrinking economy, (depending on definitions) and in such an economic climate the propensity to have children would be small.  The economic conditions for the rapidly growing number of retirees will worsen, and the USE's citizenry will soon be thinking revolutionary thoughts.  I suppose having a foreign culprit to blame is the traditional government method of forestalling citizens' mind from contemplation of bureaucratic excess.

The Japanese have advised that 'Washington has told Tokyo that the number of nuclear warheads that North Korea has is "not just one or two,"' (SMH 20/6/03)

The USA has warned North Korea that it will not permit export of WMD technology, or drugs, or other similar money-making schemes.  North Korea has warned of "serious consequences" if the USA attempts to interdict it's trade.

Let us hope that the USA can deploy an ABM defense shield quickly.  My assessment is that there is a 20% likelihood that North Korea would attack with nuclear weapons when Bush interdicts their drugs/WMD exports, and I would expect (if the ABM does not work properly) that a substantial part of North Korea would shortly thereafter become a radioactive ruin.

- AUSTRALIA'S STRENGTHENING DOLLAR -

Once again Australia's currency is strengthening. AU$1.00 now purchases around US$0.67c, up from around US$0.56c a few months ago.  As before, the reason is that the Australian Dollar is a gold backed currency.

As the price of gold goes up, our gold miners could forward sell.  Except they don't get the chance, because someone with deep pockets, realizing that the gold miners could forward sell, has pre-empted their futures trading by purchasing our (AU$) currency and driving our dollar higher as their own form of "futures trade".

Next Wednesday 25th June Greenspan is widely expected to cut rates by 1/4% or 1/2%.  Australia's journalists report that the Reserve Bank (Australia's equivalent to the US Federal Reserve) is reportedly set to mindlessly track US rates.  But perhaps Reserve's financial advisers are not quite as mindless as Australian journalists, and hopefully our rates might stay where they are, or even rise.

If our interest rates fall, we can expect the property market to climb to ever greater heights as the economy boils.   With the example of the Japanese catastrophe before us, we should bear the pain (of slowing productivity & unreduced unemployment) that might result from raising rates, and (to coin another platitude) bite the bullet.

Increasing interest rates could provide a major brake on our farming industry, which although it only accounts for 3% of GDP, simultaneously produces 25% of Australia's export income.  Perhaps a solution can be found in the much criticized US concept of paying farmers to not grow crops (i.e. let the land lie fallow to recover it's fertility).  This is a solution which, with proper spin, might please greenies and provide relief to cash strapped farmers & graziers who are ravaged by drought.

  - SARS(6) -

On perusal of the SARS data from WHO, I am struck by the fact of the disparate fatality rates.

Why do China, USA and Vietnam have such low fatality rates?

Vietnam's low fatality rate has been explained as a result of the age of the victims.   Most Vietnamese victims were young hospital staff, and it is known that fatality rate is a direct function of age.

The USA is a puzzle, but might result from a too enthusiastic application of the diagnostic criteria by CDC.  (Basically, if you have the flu, and have been to a SARS region, then what you have is SARS.)

I do not know why China has a fatality rate of 7% and everyone else (except Vietnam & the USA) has fatality rates of 15% - 17.5%.   Perhaps, like the USA, the Chinese have been overenthusiastic in their diagnosis.

I know that the disparity is a matter that concerns me.  So is the latest WHO bulletin, that warns that the world must bo on high alert for at least 12 months after SARS is putatively eradicated.  Perha[s the two are connected.

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