Financial Markets

An update, not tobe found with the “ole media”.  The report is here.

3. THE BOTTOM LINE:

a. The United States is now clearly in the end game in Iraq to successfully achieve what should be our principle objectives:

• The withdrawal of the majority of our US ground combat forces in Iraq in the coming 36 months.
• Leaving behind an operative civil state and effective Iraqi security forces.
• An Iraqi state which is not in open civil war among the Shia, the Sunnis, and the Kurds.
• And an Iraqi nation which is not at war with its six neighboring states.

b. The security situation is clearly still subject to sudden outrage at any moment by Al Qaeda in Iraq (AQI) or to degradation because of provocative behavior by the Maliki government. However, the bottom line is a dramatic and growing momentum for economic and security stability which is unlikely to be reversible. I would not characterize the situation as fragile. It is just beyond the tipping point.

• Daily attacks hit a high of 180+ in July of 2007– they are now down to 20+ per day. 5
• Civilian deaths dropped from 3700 per month in Dec 2006 — to 400 + in October 2008.
• US military deaths dropped from 110 in May of 2007—to 10 in October 2008.
• Iraqi Security Forces KIA dropped from 310 in June 2007— to 50 in October 2008.)

c. The genius of the leadership team of Ambassador Ryan Crocker, General Dave Petraeus, and Secretary of Defense Bob Gates has turned around the situation from a bloody disaster under the leadership of Secretary Rumsfeld to a growing situation of security. Ambassador Crocker will be very, very difficult to replace in February 2009. We are fortunate that General Ray Odierno has stepped in to take Joint command of MNF-I. He is very experienced, knows all the players and has sophisticated situational awareness. The Iraqis trust him enormously— they refer to him as the “big man with the quiet voice.”