Free Internet Press Newsletter - Tuesday November 6 2007 - (813)

Tuesday November 6 2007 edition
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Banks Try To Hold Off Crisis After Third Day Of Declines 2007-11-05 21:20:48 The prospect of a full-blown financial crisis edged nearer Monday as fears of "black holes" in the accounts of British, European and U.S. banks sent confidence in the sector spiraling downwards. A third successive day of falls in the values of Britain's banks, led by Barclays, mimicked declines on the continent and the U.S. following concerns that banks had failed to own up to all their debts and trading problems resulting from the global credit crunch. U.S. bank Citigroup was again in the firing line after it refused to deny the possibility of a third warning on its losses from the sub-prime mortgages debacle. Citigroup boss, Charles Prince, stepped down on Sunday after the bank said it might suffer an $11 billion (£5.5 billion) writedown for sub-prime losses, on top of the $6.5 billion (£3.25 billion) it wrote off three weeks ago. The group was unable to say yesterday whether a third warning could be ruled out, leading to speculation that the bank and many of its rivals would be releasing more bad news in the coming weeks. Banks in North America and Europe have written off billions of dollars on holdings of mortgage-backed securities that were considered safe but have subsequently been found to contain U.S. sub-prime mortgages. The sub-prime crisis began last year when the U.S. Federal Reserve began raising interest rates. It resulted in thousands of Americans, many without a job or strong credit history, handing back the keys to their homes. In many cases banks have slashed the value of their mortgage securities by 80% or more. British banks said they escaped relatively unscathed. Barclays said its losses could at most be £75 million ($155 million), which would be only a tiny fraction of its overall profits. Read The Full Story Commentary: Gloomy Days For U.S. Influence 2007-11-05 21:20:11 Intellpuke: The following commentary was written by columnist Simon Tisdall and appears in the Gaurdian edition for Tuesday, November 6, 2007. President-General Pervez Musharraf's "second coup" amounted to a serious personal blow for Condoleezza Rice, the U.S. secretary of state, and American counterterrorism and nation-building policies in the Pakistan-Afghanistan badlands. Whatever his other failings, the crisply pressed Pakistani leader is a gentleman of the English colonial school. But good manners did not prevent him rejecting Ms Rice's latest calls for restraint - and then ignoring her phone calls during a fraught weekend that saw him tear up a host of solemn undertakings. Article continues Gen. Musharraf's calculation that the White House and Pentagon would tacitly go along with his putsch looks correct in the short term. As always his fealty, however conditional, to the "global war on terror" is Washington's first priority. Read The Full Story Bloody Crackdown In Pakistan 2007-11-05 21:19:05 Riot police fire teargas, thrash protesters and arrest thousands as the West protests Musharraf's emergency rule. Pakistani police launched a sweeping crackdown on opposition to military ruler President Pervez Musharraf Monday, thrashing protesters and arresting thousands as western powers stepped up pressure for an early end to emergency rule. The first big street protests since Gen. Musharraf assumed wide-ranging powers on Saturday were swiftly crushed. Riot police fired teargas, baton charged crowds and flung bloodied lawyers into prison vans. The interior ministry said at least 1,500 people had been picked up; opposition groups estimated over twice as many arrests. Article continues Britain and the U.S. urged Gen. Musharraf to keep his earlier promises to restore the constitution, resign as army chief and hold elections by January. Britain's foreign secretary, David Miliband, suggested that Islamabad was bowing to intense international pressure to pursue an alternative course. "What's striking is that the international community and the domestic political community agreed on the steps to be taken. There was real unanimity," he said. Read The Full Story Editorial: Putting An End To Abusive Lending 2007-11-05 16:14:27 Intellpuke: The following editorial appears in the New York Times edition for Monday, November 5, 2007. When members of the House Financial Services Committee meet this week to put the finishing touches on a bill to curb abusive mortgage lending, they need focus only on how to make a good bill better. The bill’s critics - mainly the finance industry that profited immensely during the mortgage bubble - claim that new rules could sharply curtail lending. But the current credit squeeze was brought on by reckless lending. Obviously, an absence of rules is a much greater threat to the stable flow of credit than is sound regulation. The unassailable premise of the bill - the Mortgage Reform and Antipredatory Lending Act of 2007 - is that lending standards and consumer protections have proved disastrously lax as mortgage making has gone from a local business to a faceless global market for mortgage-related investments. Its approach to establishing standards and protections is levelheaded and evenhanded. The bill requires those giving out loans to first document that borrowers have a reasonable ability to repay, not just during a lower-rate introductory period but also after rates rise. It would eliminate perverse incentives that reward mortgage brokers for putting borrowers into the costliest loans possible. And it requires mortgage brokers to be licensed and registered, putting them more on a par with stockbrokers and insurance brokers. Read The Full Story Parsons To Step Down As Time Warner Chief, Bewkes Tapped As Successor 2007-11-05 16:13:57 Jeffrey L. Bewkes will succeed Richard D. Parsons as the chief executive of Time Warner Inc. at the end of the year, the company announced Monday, confirming a widely expected transition of power at one of the world’s foremost media companies. Parsons will remain chairman. Bewkes, 55, who was named president and chief operating officer of Time Warner last year, has long been considered Parsons’s likely successor. Before being promoted to chairman of Time Warner’s entertainment and networks group in 2002, he spent 11 years at the premium television channel HBO, including seven years as chief executive. Parsons, 59, was promoted to chairman and chief executive in 2002 and immediately steadied the ship in the wake of the AOL-Time Warner merger. Robert C. Clark, a member of the company’s board, said Parsons first approached the board in early 2006 to discuss the timetable for a succession plan. Read The Full Story Bayer Heart Surgery Drug Sales Halted, As FDA Reviews Study 2007-11-05 15:39:09 The U.S. Food and Drug Administration Monday announced that Bayer Pharmaceuticals had agreed to suspend the sale of a drug widely used to control bleeding during heart surgery after a study found that patients receiving the medication were at increased risk of dying. Bayer agreed to stop selling Trasylol until the agency had a chance to complete a detailed review of the Canadian study, which was halted two weeks ago after preliminary analysis indicated those taking the medication were more likely to die than those taking two other drugs. Because there are few alternatives, the agency plans to work with the company to slowly phase out the sale of the drug to avoid shortages for patients, said the agency. The agency also left open the possibility that the drug may be permitted for use by specific patients if doctors can determine the benefits outweigh the risks. "At this time, FDA cannot identify a specific patient population where we believe the benefits outweigh the risks," said John K. Jenkins, director of the FDA's office of new drugs. Read The Full Story Oil's Recent Rise Not Result Of Supply Or Politics, It's ...Traders! 2007-11-05 00:44:31 Investors are thought to be driving prices upward, bolstered by weak dollar, money leaving markets. After a week of new records for crude oil prices, the question is: How high can they go? In the past 10 weeks, the price of crude oil has shot up $25 a barrel, closing at $95.93 in New York on Friday, an all-time inflation-adjusted peak. Unlike earlier spikes in oil prices, which came on the heels of war in the Middle East, this latest ascent does not appear to be linked to any one conflict or to any physical shortage. Instead, traders who treat oil like any other commodity are widely thought to be driving prices upward, bolstered by a weak dollar and money flowing out of stock markets and other investment vehicles. Read The Full Story	Al-Qaeda Recruiting Teenagers To Attack Targets In U.K. 2007-11-05 21:20:34 MI5 chief spells out scale of new threats in first public speech as terror cells plot from growing list of countries. Teenagers as young as 15 are being groomed to carry out terrorist attacks in Britain and al-Qaeda sympathizers are hatching plots in a growing number of foreign countries against targets here, the head of MI5 warned Monday. In his first public speech, Jonathan Evans described the threat posed by al-Qaeda-inspired extremism as "the most immediate and acute peacetime threat" the security service had faced in its 98-year history. The threat, he emphasized, had its roots in ideology, making it all the more important that the response must not be indiscriminate. "Terrorists are methodically and intentionally targeting young people and children in this country", Evans told the annual conference of the Society of Editors in Manchester. He added: "They are radicalizing, indoctrinating and grooming young, vulnerable people to carry out acts of terrorism. This year, we have seen individuals as young as 15 and 16 implicated in terrorist-related activity." Read The Full Story A New Earth? 2007-11-05 21:19:46 How close are astronomers to finding a plant that supports life? Andrew Collier Cameron stretches a hand towards the charcoal skies that have gathered over the Kingdom of Fife and talks of a planet that lies far beyond the clouds. It is a planet that has never been seen, even through the most powerful space telescopes. It revealed itself to Cameron only by casting the tiniest of shadows as it strayed in front of its parent star, 1,000 light years from his office in the physics building at St. Andrew's University on the east coast of Scotland. Though distant, the planet has given up a few of its secrets. It is a world that shows only one face to its sun: half of it basks in permanent warmth while the other lies in eternal darkness. It moves so swiftly round its star that a year there lasts only a few Earth days. It is a giant that would dwarf not just our blue-green planet but even Jupiter, the largest in the solar system, yet it is incredibly light in comparison: it has the density of willow. "It would float!" says Cameron, his fingers spread wide. "If you could only find a bath big enough!" Here on Earth, Cameron and his team are part of a new wave of astronomers who are scouring the galaxy for glimpses of unknown worlds and, in recent years, their success has been astounding. While our own solar system lost a planet last year, thanks to the unceremonious demotion of Pluto from planet to "dwarf planet", Cameron and his peers have found more than 250 new worlds, in solar systems far, far away. With almost every week that goes by, new discoveries are made. This evening, in fact, planet hunters in America are to declare a major coup with the announcement from NASA  of a newly discovered solar system that has striking similarities to our own. Read The Full Story U.S. Plan For Nuclear Storage Is Slow To Take Form 2007-11-05 16:14:39 The Energy Department has not finished plans to consolidate storage of nuclear bomb fuel and other high-risk materials now spread among numerous sites, even though the department said in 2005 that it would do so within about a year, according to a Government Accountability Officie report to be released Monday. As a result, the department is spending hundreds of millions of dollars to defend additional sites. The G.A.O. had reported that the Energy Department was putting off making security improvements at some of the storage sites because the sites were due to be phased out. The new report makes clear that the goal of shutting down some obsolete weapons and research centers, and simplifying the security job by centralizing “special nuclear material,” as bomb fuel is called, has yet to advance from concept to plan, let alone to finished project. The Energy Department “has completed only two of the eight implementation plans for consolidating and disposing of special nuclear material,” the new report found, and it cited problems with those two plans. Read The Full Story Flood Waters Recede in Mexico's Tobasco State 2007-11-05 16:14:16 The city of Villahermosa woke up Monday to find that the rivers that have flooded much of the state of Tabasco had begun to recede. Many of the thousands of evacuees displaced by the worst flooding the state has ever seen remained in shelters, and thousands were also reported to still be stranded. Rescue operations continued in outlying areas that are still cut off by flooded roads. In some areas of Villahermosa, the state capital, there were signs of a partial return to normalcy. Classes began in a few schools that had not been damaged by flooding. Traffic clogged streets that had not been affected by the floods. In shelters, doctors and nurses attended long lines of evacuees, many of them suffering from skin and fungal infections caused by wading through water. The interior secretary, Francisco Ramirez Acuna, toured the state this morning but he said he had no estimate yet of the full extent of the damage. Read The Full Story Thousands Protest Emergency Rule In Pakistan 2007-11-05 15:39:23 Lawyers rally against Musharraf decision to suspend constitution and government crackdown on political opposition, news media and courts. Police used tear gas and baton charges Monday to break up protests as thousands of lawyers took to the streets across Pakistan in the first significant demonstrations against President Pervez Musharraf's declaration of emergency rule on Saturday. The largest rally took place in the eastern city of Lahore, where lawyers and police battled each other at the city's High Court complex. Several lawyers were injured, and hundreds were arrested before the protesters were dispersed. Lawyers vowed to continue their protests in the coming days. "We are determined that until there is freedom for the judges and the overturn of emergency rule, this war will continue," said Anwar Shaheen, a lawyer in Lahore. "They can't quiet us." Read The Full Story Musharraf Warned: Hold Vote And Quit As Army Chief 2007-11-05 00:44:47 Envoys from the U.S. and Britain to spell out ultimatum in talks with Pakistan's president. The U.S. and Britain are Monday expected to demand that Pakistan's president, Pervez Musharraf, honor pledges to hold elections in the next two months and step down as the army chief, or face a cut in western support. The diplomatic showdown will come in the form of a meeting in Islamabad between the Pakistani leader and a group of ambassadors, two days after he declared emergency rule - and three days after giving assurances to the British prime minister, Gordon Brown, and U.S. Secretary of State Condoleezza Rice that he would stick to an election deadline in mid-January, and step down as head of the country's army. Article continues Last night Pakistan's prime minister, Shaukat Aziz, called those promises into question when he said the government had not decided when to hold the elections and warned they could be delayed by up to a year. Wielding his new powers with an iron fist Sunday, Gen. Musharraf rounded up hundreds of opposition and human rights activists and introduced tight media regulations. Aziz's statement directly contradicted personal assurances Gen. Musharraf apparently gave to  Brown and Rice on the eve of the emergency declaration. The pledge to the prime minister was made on Friday, when Brown telephoned Musharraf and expressed concern over reports that an emergency decree was being planned. Read The Full Story Astronauts Fix Space Station's Damaged Solar Panel 2007-11-05 00:44:02 Astronauts patched a damaged solar panel on the international space station Saturday during a tricky and dangerous seven-hour spacewalk. Perched on the tip of an extension of the station's long robotic arm, astronaut Scott E. Parazynski snipped off tangles of broken and frayed wires that had ripped open two spots on the huge solar array, and installed five jury-rigged straps to reinforce the damaged area, allowing the panel to finally unfurl fully. "Excellent work, guys, excellent," space station commander Peggy A. Whitson said after the tense, painstaking job was finally done. The spacewalk was considered particularly risky, with Parazynski venturing farther from the safety of the station than ever before. The repairs were unusually complicated because the astronauts were unable to fully assess the damage before getting close to the array and had to hope that their quickly improvised repair plans would work. Normally, such a repair mission would take weeks or even months of preparation and rehearsal. Read The Full Story
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