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Con: 1. Market Focus 1.1 Aerospace and defense stock predictions: the hits and misses of 2008. / Joseph C. Anselmo.p.8. 2. News Breaks 2.1 Virgin Galactic's whiteKnightTwo carrier aircraft is undergoing tests in the run-up to first flight.p.10. 2.2 New responsabilities established for several editors of AVIATION WEEK publications.p.10. 2.3 Selex Galileo successfully tests its Falco unmanned aircraft using a new catapult launch system.p.11. 2.4 XCOR Aerospace completes its first test fire of 5K18 liquid-oxygen and kerosene rocket engine.p.12. 2.5 Airbus begins new series of trials of blended winglets for possible use on the A320 family.p.13. 3. World News & Analysis 3.1 U.S. Navy, Northrop Grumman detail UCAS demo plan and novel X-47B features in sea change for stealth. / Guy Norris.p.16. 3.2 France begins program with Boeing UAV rotocraft to see those designs can meet naval needs. / Michael A. Taverna and Robert Wall.p.18. 3.3 France approves recovery package to spedd up fielding of new weapon systems in Afghanistan. / Michael A. Taverna.p.19. 3.4.EU expected to make major headway in '09 in removing trade barriers to military equipment. / Robert Wall.p.19. 3.5 A400M officials hope the engine's first flight, new organizational structure will smooth their path. / Robert Wall.p.20. 3.6 China developing big military space capabilities using small satellite payloads. / Craig Covauit.p.22. 3.7 Griffin: NASA failed to obtain Bush approval of an overture to China for space mission. / Craig Covauit.p.24. 3.8 NASA, contractors planning to remove and reassemble an 80.000-lb. stretch of ISS structure. / Frank Morring.p.25. 4. Air Transport 4.1 Etihad's purchase of low-fare Air Berlin could lead to new business pattern. / Jens Flottau.p.27. 4.2 Emirates eyes weight cuts so A380s can use polar route to U.S. West Coast. / Michael Mecham.p.28. 4.3 Brussels Airlines reviving ideas to turn namesake airport into an important hub. / Jens Flottau.p.28. 4.4 Renade Alitalia charts a future it hopes will sidestep errors of its loss-making past. / Andy Nativi.p.30. 4.5 ATR looks for closer cooperation with engine makers on designing new aircraft. / Robert Wall.p.31. 4.6 China Eastern management change may presage restructuring of country's airline sector. / Bradley Perrett.p.32. 5. Dear Mr. President-elect 5.1 U.S Faces challege of modernizing an air transportation system that has not kept pace with technology.p114