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PRESSTV Tue, 13 May 2008 08:57:19 GMT
China's new underground nuclear submarine base close to vital sea lanes in South East Asia has challenged US military dominance in Asia.

US experts have termed China's underground base on the southern tip of Hainan Island a threat and called for a shoring up of alliances in the region to check Beijing's growing military clout.

China should not pursue such "high-end military options," warned Admiral Timothy Keating, the top commander of US forces in Asia, in an interview with the Voice of America last week.

He underlined America's "firm intention" not to abandon its dominating military role in the Pacific and told Beijing it would face "sure defeat" if it took on the United States militarily.

James Lyons, an ex-commander of the US Pacific Fleet, said the United States needed to reestablish high-level military ties with the Philippines as part of efforts to enhance US deterrence in the wake of China's naval expansion.

He said "operational tactics" used against the former Soviet Union during the Cold War should be applied against China.

Richard Fisher, an expert of China military affairs at the International Assessment and Strategy Center, a US think tank, expected US confrontation with China as Beijing modernized its nuclear ballistic missile submarines, referred to in military jargon as SSBNs.

The Hainan facility, he said, was a timely replacement for Beijing's first nuclear ballistic missile submarine base at the Bohai Gulf north of the country, which he added was too shallow to support nuclear deterrent patrols.

NATIONALECONOMIST Tue, 13 May 08

The controversial deal orchestrated by the Federal Reserve that pushed Bear Stearns into the hands of JPMorgan Chase, at the height of the sub-prime crisis, will turn into billions of dollars in gains for for JPMorgan Chase.

The deal will result in an immediate second quarter gain of $1 billion for JPMorgan Chase, admitted Chairman and Chief Executive Officer Jamie Dimon.

The projected $1 billion gain reflects the addition of Bear Stearns capital, offset by roughly $9 billion of losses reflecting asset sales, purchase accounting, restructuring, litigation costs and Bear’s second-quarter losses, Dimon told a UBS investor conference.

In the longer term, after some short-term losses, Dimon said Bear’s investment bank would generate between $800 million and $1.13 billion of earnings annually for JPMorgan.

Thus, a deal that could not have been done without the Federal Reserve providing a $30 billion dollar line of credit for JPMorgan’s takeover of Bears Stearns, now, in just weeks after the deal, will mean short-term gains of a billion dollars for JPMorgan Chase and down the road a billion annually for JP Morgan Chase.