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Wednesday, November 12, 2008

Free Internet Press Newsletter - Wednesday November 12 2008 - (813)

Wednesday November 12 2008 edition
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Retail Worries Push Stock Markets Lower
2008-11-11 18:31:23

Wall Street tried to come back from a wide deficit on Tuesday afternoon as languishing stocks regained some of their early losses. But the run stalled out.

The Dow Jones industrial average, which was down 300 points at mid-day, closed 176.58 points lower, and the broader Standard & Poor’s 500-stock index was off about 2.2 percent.

On a day when markets across Asia, Europe and the United States were parked in the red, a sudden afternoon spurt caught some investors by surprise. Analysts attributed the movement to new measures by the mortgage finance giants Fannie Mae and Freddie Mac to reduce foreclosures, as well as cautiously optimistic reports from two equity and investment firms.

“The market really started to rip,” said Ryan Larson, head equity trader at Voyageur Asset Management. “What we’ve seen is that the market continues to be all about transparency. They want to be able to understand what’s going on. Any good news, the market rewards, and that’s what we’re seeing right now.”

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Global Warming: 'The Goal Is To Change Course, Not Slow Down'
2008-11-11 18:23:34
Intellpuke: In an interview with Germany's Spiegel news magazine, economist and climate change expert Ottmar Edenhofer, 47, speaks about how the current financial crisis has affected climate-protection efforts and why current government proposals don't go far enough.

SPIEGEL: Mr. Edenhofer, you want to reconcile the economy with climate protection. Is that even possible?

Ottmar Edenhofer: During the 20th century, labor efficiency rose because we placed no limits on our use of fossil fuels as a source of energy. That will no longer work in the 21st century. We have to succeed in decoupling economic growth from CO2 emissions. We simply don't have another viable alternative.

SPIEGEL: In 2009, the U.N. is planning to reach a new global climate agreement. In these times of financial crisis, is that even possible?

Edenhofer: We have to make it possible, otherwise, we will see an environmental collapse just like the one we have experienced with banks. If we hesitate on climate protection, we will essentially be digging our own grave. It will be expensive to reverse the process and repair the damage later on.

SPIEGEL: The economist Hans-Werner Sinn has warned that climate protection in the West is only making oil and natural gas cheaper for China and India.

Edenhofer: We have to take this warning seriously. If the good example that we set fails to convince the Chinese and the Indians to come on board with climate protection, the oil and gas that we don’t burn will be burned in Asia. That would make all our climate policies meaningless.

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Investigation Sought Of Bush Handling Of Alaska Oil-Spill Case
2008-11-11 18:22:36
An environmental watchdog group asked the Department of Justice's inspector general on Monday to investigate whether the department had prematurely halted a criminal prosecution of BP for a 2006 oil spill in Alaska.

Public Employees for Environmental Responsibility filed the complaint on behalf of Scott West, who as the special agent in charge for the Environmental Protection Agency participated in the federal and state investigation of the spill.

West, who retired last week after 19 years as an EPA criminal investigator to take a job with the Sea Shepherd Conservation Society, said he'd argued for more time last year because he and his team were looking for evidence to prove felonies. The Justice Department, however, said the evidence had been fully investigated and charged BP with a misdemeanor.

BP, one of the world's largest energy companies, agreed in October 2007 to plead guilty to the federal misdemeanor and pay $20 million in criminal penalties for two Prudhoe Bay spills. One was the largest spill on the North Slope; about 201,000 gallons of oil leaked onto the tundra and a frozen pond.

When the plea was announced last year, federal and state authorities said that the spills had occurred because BP hadn't spent the money necessary to maintain its pipes.

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Bush Leads Veterans Day Ceremony At The Intrepid
2008-11-11 15:34:23
With a standing ovation for President Bush, a Texas country singer crooning about World War II, and commanders of the five branches of the Armed Services and thousands of veterans on deck, a spot off the West Side of Manhattan turned into a bit of patriotic Americana on Tuesday.

After a two-year, $115 million renovation and design, the Intrepid Sea, Air & Space Museum was formally rededicated in a 90-minute ceremony led by Mr. Bush and the first lady, Laura Bush, and dedicated to the nation’s veterans.

“I’m honored to be with you today as we rededicate a great monument to freedom, the Intrepid Sea, Air & Space Museum,” Bush, who was presented with the Intrepid Freedom Award, said in a ceremony on the 900-foot-long flight deck of the retired aircraft carrier, which was commissioned in 1943 and served through World War II.

“At this ceremony we recognize that there were 55,000 Americans who served aboard the U.S.S. Intrepid, including some who are here today, and commemorate Veterans Day by honoring all those who have worn the uniform of the Air Force, Army, Navy, Marine Corps and Coast Guard,” said the president.

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Oil Prices Hit $60 A Barrel, Not Seen Since March 2007
2008-11-11 15:34:00
Oil prices fell below $60 a barrel on Tuesday to their lowest level in 20 months, as weak economic growth has reduced consumption around the world.

The drop came despite growing indications that OPEC producers have been trimming output to try and stem the price decline. The cartel reached an emergency agreement last month to reduce output by 1.5 million barrels a day starting on Nov. 1.

While no official tally of OPEC production exists, several member countries - including Algeria, Qatar, the United Arab Emirates and Kuwait - have signaled that they had reduced their output by about 1.1 million barrels a day. Various reports also suggested that Saudi Arabia, the cartel’s kingpin, had warned some Asian customers that it would be paring exports by 5 percent next month.

However, according to estimates by PFC Energy, a consulting firm, producers have actually trimmed their output by only about 800,000 barrels a day.

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Obama To Take Regional Approach To Afghan War
2008-11-11 02:30:35

The incoming Obama administration plans to explore a more regional strategy to the war in Afghanistan - including possible talks with Iran - and looks favorably on the nascent dialogue between the Afghan government and "reconcilable" elements of the Taliban, according to Obama national security advisers.

President-elect Barack Obama also intends to renew the U.S. commitment to the hunt for Osama bin Laden, a priority the president-elect believes President Bush has played down after years of failing to apprehend the al-Qaeda  leader. Critical of Bush during the campaign for what he said was the president's extreme focus on Iraq at the expense of Afghanistan, Obama also intends to move ahead with a planned deployment of thousands of additional U.S. troops there.

The emerging broad strokes of Obama's approach are likely to be welcomed by a number of senior U.S. military  officials who advocate a more aggressive and creative course for the deteriorating conflict. Taliban attacks and U.S. casualties this year are the highest since the war began in 2001.

Some military leaders remain wary of Obama's pledge to order a steady withdrawal of combat forces from Iraq, to be completed within 16 months - an order advisers say Obama is likely to give in his first weeks in office. Adm. Michael Mullen, chairman of the Joint Chiefs of Staff, has called a withdrawal timeline "dangerous." Others are distrustful of a new administration they see as unschooled in the counterinsurgency wars that have consumed the military for the past seven years.

But conversations with several Obama advisers and a number of senior military strategists both before and since last Tuesday's election reveal a shared sense that the Afghan effort under the Bush administration has been hampered by ideological and diplomatic constraints and an unrealistic commitment to the goal of building a modern democracy - rather than a stable nation that rejects al-Qaeda and Islamist extremism and does not threaten U.S. interests. None of those who discussed the subject would speak on the record, citing sensitivities surrounding the presidential transition and the war itself.

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Editorial: It's About The Mortgages
2008-11-11 02:30:12
Intellpuke: This editorial appeared in the New York Times edition for Monday, November 10, 2008.

Treasury Secretary Henry Paulson does not seem like the sort of man who suffers fools gladly. Yet, he apparently is tolerant of, or powerless against, a White House that remains opposed to direct government action to prevent foreclosures - a program that is essential to keep millions of Americans in their homes and head off an even deeper financial catastrophe.

Nearly three weeks ago, Sheila Bair, the chairwoman of the Federal Deposit Insurance Corporation, told Congress that the agency was working closely with Mr. Paulson’s department to develop a robust anti-foreclosure plan. Since then, the Treasury Department has balked and equivocated while the White House has argued that it is already doing plenty to help homeowners.

After a year of doing far too little to stem a flood of foreclosures, the problem is getting worse. Defaults lead to foreclosures that push down all house prices. Those falling prices - combined with rising unemployment, falling incomes and another expected surge in monthly payments on adjustable rate loans - will surely lead to more defaults and deeper price declines, threatening bank solvency and prolonging the credit crunch.

Clearly, the system won’t stabilize until house prices stabilize, and banks won’t lend freely until losses on defaulting mortgages abate.

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NASA: Phoenix Mars Mission Ended
2008-11-11 02:29:47
NASA on Monday declared an end to the Phoenix mission, some five months after the spacecraft became the first to land in Mars' arctic plains and taste water on another planet. Mission engineers have not heard from the Phoenix lander in over a week. It fell silent shortly after a raging dust storm blocked sunlight from reaching its solar panels.

Although ground controllers will direct two satellites orbiting Mars to listen for Phoenix for several more weeks, the chances that it will respond are slim.

"We are actually ceasing operations, declaring an end of mission operations at this point," said project manager Barry Goldstein of NASA's Jet Propulsion Laboratory, which managed the $475 million mission.

Phoenix's demise was predicted. Unlike its hardy twin rover cousins Spirit and Opportunity, which are approaching their fifth year near the red planet's more hospitable equatorial region, Phoenix's days were numbered from the outset. With sunlight waning and winter encroaching the arctic plains, scientists had said it was a matter of time before Phoenix would freeze to death.

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George Carlin Gets The Last Laugh At Kennedy Center
2008-11-11 02:28:25
Funny thing is, George Carlin couldn't make it to his big night.

The late George Carlin, whose sense of irony was world class, would have appreciated last night's Mark Twain Prize for American Humor ceremony at the Kennedy Center, though it's not clear which rich irony he would have liked most.

Surely, he would have gotten a kick about being too dead to pick up the prize himself, as more than one presenter noted. Carlin died in June at 71, a week after learning that he'd won the 11th annual prize.

Perhaps, as a lapsed Catholic (and an extremely amusing atheist), Carlin would have dug the whole Irish wake aspect of the ceremony: Jokes were not just permissible, they were mandatory, in honoring the recently departed.

As a stand-up comic whose career ranged from the Ed Sullivan era to the Facebook age, Carlin might have been amused by the fact that none of the stand-ups who came to honor him (Bill Maher, Lewis Black, Lily Tomlin, Jon Stewart, Joan Rivers and Garry Shandling, among others) actually got to do much stand-up. Some great introductory cracks, sure, but mostly in service of introducing clips of some of Carlin's classic bits.

And as a comedian who made an art out of blue language ("The king of raw," Maher called him) Carlin surely would have gotten some mileage out of the fact that only three of his "Seven Words You Can Never Say on Television" were actually spoken from the Kennedy Center stage. (Denis Leary alone accounted for three F-bombs.)

Carlin himself rematerialized in a clip to do the bit, though - again, ironically - the commentary on language and the absurdity of banning words was itself bleeped repeatedly by the Kennedy Center censor.

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Bush's War On Science: The Stalin Era For Environmental Protection
2008-11-11 18:31:12
Secretive changes at the U.S. Environmental Protection Agency (EPA) have diluted science and jeopardized public health. Will Obama overcome Bush's toxic legacy?

This may sound like just another Erin Brockovich-style tear-jerker. Enter stage right: Poor people exposed to toxic chemicals who worry that the government is ignoring their plight.

Yet the story of the hundreds of sick people who live near the former Kelly Air Force Base illuminates an entirely new manner in which the Bush administration has diluted science and put public health at risk. This year, largely in obeisance to the Pentagon, the nation's biggest polluter, the White House diminished a little-known but critical process at the Environmental Protection Agency (EPA) for assessing toxic chemicals that impacts thousands of Americans.

As a coalition of more than 40 national and local environmental organizations put it in a letter to EPA administrators this past April: "EPA, under pressure from the Bush White House, has given the foxes the keys to the environmental protection henhouse."

So meet lifelong San Antonio, Texas, residents Robert and Lupe Alvarado. For decades, the Alvarados, whose modest home sits around two miles from Kelly, have lived with toxic chemicals underfoot. This is the poor part of town, adorned with chain-link fences and black metal bars concealing the windows. Many houses lack a proper foundation and rest on simple concrete slabs.

Beneath the Alvarados' house and those of their neighbors are shallow pools of groundwater that are polluted with tetrachloroethylene, or PCE, a chemical associated with cancer, liver and kidney disease. Before the Kelly base closed in 2001, mechanics used PCE to degrease parts on airplanes and fighter jets. For decades, they chronically dumped the solvent into poorly sealed or unsealed waste pits on the base, where it seeped underground, forming a plume that sprawls over four square miles under 23,000 homes and businesses. Locals refer to the area as "the toxic triangle."

On cool or rainy days, when the Alvarados close the windows and shut off the air conditioning, a sweet chemical smell floods the house. When they eat dinner during these times, says Robert, 66, it's like tasting something acrid. "We drink bottled water but there's nothing we can do about the air except go outside and wait," says Lupe, 64.

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Commentary: How The U.S. Can Fix Its Reputation Abroad
2008-11-11 18:23:09
Intellpuke: This commentary was written by Strobe Talbott, president of the Brookings Institution in Washington, D.C. Mr. Talbott was U.S. deputy Secretary of State for seven years in the Clinton administration. His commentary follows:

Eight years of Bush administration leadership has severely damaged the reputation of the United States abroad. The incoming president will inherit this deficit as well as a host of other foreign policy crises. To gain back trust, he will have to address nuclear nonproliferation and climate change.

The president of the United States inaugurated on January 20, 2009 will inherit the most complex, difficult and dangerous array of foreign policy challenges ever facing a newcomer to the Oval Office: wars in Iraq and Afghanistan, a rising Iran, a Pakistan that has lost control of its own borders, a languishing Arab-Israel peace process, a Syria covertly cooperating with North Korea on a nuclear weapons program - and that is just in one region of the world. In dealing with those and other problems, the United States, under its next president, will need all the help in can get from other nations. Therefore the incoming chief executive will have to move quickly to improve - and indeed repair -  America's image in the world.

Polls taken in recent years show a precipitous decline in respect for and trust in the United States. Those two essential ingredients for leadership of the international community have been severely damaged during the administration of George W. Bush. During his first term, President Bush withdrew from, nullified, "unsigned" or backed away from a range of agreements, including the Rome Statute of the International Criminal Court, the Kyoto Protocol to the United Nations Framework Convention on Climate Change, and the Anti-Ballistic Missile Treaty, which was originally signed by Richard Nixon and Leonid Brezhnev and was observed by the five presidents who followed Nixon.

The Bush administration's decision in 2003 to invade and occupy Iraq in defiance of the United Nations Security Council and over the objections of many U.S. allies was the high-water mark of U.S. unilateralism - and, correspondingly, a new low in America's standing in the eyes of the world. Toward the end of his first term, as Iraq turned from a military "cakewalk" into a political quagmire, President Bush realized the need for course-correction and fence-mending. At the start of his second term, he sent Secretary of State Condoleezza Rice to Europe and then made a conciliatory trip of his own. The administration re-engaged cautiously in multilateral diplomacy aimed at peacefully dealing with the threats of the Iranian and North Korean nuclear programs. Bush entered his last year in office hoping to score diplomatic points in the Middle East and elsewhere. But those hopes dimmed with his public opinion ratings at near-record low and time running out.
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Suspicion Mounts Over Syria's Nuclear Ambitions
2008-11-11 18:22:24
The alleged discovery of uranium traces at a bombed-out Syrian site, which was blitzed by Israeli warplanes in 2007 amid fears it was a covert nuclear reactor, has raised fresh doubts over the Middle Eastern state's avowed intentions to produce nuclear materials solely for benign purposes.

Diplomats in Vienna, Austria, have revealed that samples taken from a suspected secret nuclear reactor in Syria contained traces of uranium combined with other elements that diplomats say merit further investigation.

Officials in the United States also believe the site, which was hit by Israeli bombers in September 2007, was a nearly completed nuclear reactor capable of producing plutonium, a pathway to nuclear arms.

Damascus has repeatedly insisted that it has no nuclear weapons program, and there was no immediate response from Syria Tuesday about the news of the alleged uranium find.

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U.S. Government Announces New Program For At-Risk Mortgages
2008-11-11 15:34:11

The government and mortgage industry - including federally run mortgage finance giants Fannie Mae and Freddie Mac - Tuesday announced a new streamlined system for modifying the mortgages of hundreds of thousands of borrowers to avoid foreclosure. Under the program, Fannie Mae, Freddie Mac and other companies would move to modify mortgages for borrowers who are more than 90 days late on paying their loans and fit within certain formulas. That contrasts with the current system, where modifications are addressed on a case-by-case basis.

The goal of the new program would be for borrowers' annual mortgage payment to equal 38 percent of annual income, the model used successfully by the government with IndyMac in California. The companies would do that by extending the loan term, reducing the interest rate and, if necessary, delaying payment on a part of the principal of the loan. If a borrower is able to meet payments for three months, the change becomes permanent.

"Foreclosures have increased 150 percent in the past two years," said James B. Lockhart III, the director of the Federal Housing Finance Agency, at an afternoon press conference today. "We need to stop this downward spiral."

Joining Lockhart at the press conference was Neel Kashkari, the interim assistant Treasury secretary for financial stability; Faith Schwartz, head of the Hope Now alliance of financial institutions that have agreed to take measures to reduce foreclosures; and Michael Heid, a senior mortgage executive at Wells Fargo.

"We are experiencing a necessary housing correction and the sooner we work through it, the sooner housing can again contribute to our economic growth," said Kashkari.

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GM Shares Shrivel, Dow Jones Slumps, Too
2008-11-11 15:33:46
A fall in crude oil below $60 a barrel and a worsening outlook for corporate profits kept the pressure on stock prices for a second straight day Tuesday.

Shares of beleaguered General Motors Corp. shriveled 17% to their lowest level since 1942 on expectations that the car maker will get a government bailout that would dilute the ownership stakes of existing shareholders. Starbucks Corp. shares were off 2.7% after the coffee retailer revealed a larger-than-expected drop in same-store sales.

The Dow Jones industrial average declined 263.96 points, or 3%, to 8,606.58. The Standard & Poor's 500 index was off 3.2% and the Nasdaq composite index shriveled 2.9%.

The S&P financial-stock index skidded 3.7% to a new low this morning, undercutting the trough it set on Oct. 27. Only seven of the 84 stocks in the index registered gains.

Genworth Financial lost half its value. CB Richard Ellis Group Inc. shrank 30% after the commercial property broker dropped plans to raise money in a private offering.

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A Town Drowns In Debt As Home Values Plunge
2008-11-11 02:30:24
This town, Mountain House, California, 59 feet above sea level, is the most underwater community in America.

Because of plunging home values, almost 90 percent of homeowners here owe more on their mortgages than their houses are worth, according to figures released Monday. That is the highest percentage in the country. The average homeowner in Mountain House is “underwater,” as it is known, by $122,000.

A visit to the area over the last couple of days shows how the nationwide housing crisis is contributing to a broad slowdown of the American economy, as families who feel burdened by high mortgages are pulling back on their spending.

Jerry Martinez, a general contractor, and his wife, Marcie, an accounts clerk, are among the struggling owners in Mountain House. Burdened with credit card debt and a house losing value by the day, they are learning the necessity of self-denial for themselves and their three children.

No more family bowling night. No more dinners at Chili’s or Applebee's. No more going to the movies.

“We make decent money, but it takes a tremendous amount to pay the mortgage,” said Martinez, 33.

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Afghanistan, Iraq U.S. Veterans Gain A Powerful Voice On Capitol Hill - Their Own
2008-11-11 02:29:59

Some lobbyists come to Capitol Hill armed with PowerPoint presentations and Excel spreadsheets. Todd Bowers brought the rifle scope that saved his life.

He was on patrol outside Fallujah, Iraq, when his unit came under fire. Bowers, 29, a staff sergeant in the Marine Corps Reserve, fired back. A sniper's bullet hit his scope, inches from his face.

So when members of Congress wanted to know why they should pass legislation that would reimburse service members for buying their own combat equipment, Bowers, 29, a staffer at Iraq and Afghanistan Veterans of America, pulled out the $600 piece of equipment his father had bought him before his second tour in Iraq. His scope, with the bullet still lodged in it, brought the war home.

The legislation passed.

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Britain's Prime Minister Hails Obama's Victory As 'Dawn Of Hope'
2008-11-11 02:28:42
British Prime Minister Gordon Brown Monday used his first foreign policy speech since Barack Obama's election to hail his victory as America's "dawn of hope" and a rejection of the unilateralism of George Bush.

The prime minister called for a progressive multilateralism in which "cooperation, not confrontation, flourishes as an answer to age-old challenges".

He said the world needed to be guided by one clear truth: "That we need solutions that can no longer be defined in terms of us and them, but can only be achieved together, as us with them."

Speaking at the Lord Mayor's banquet, in the set-piece prime ministerial foreign policy speech of the year, Brown argued that the transatlantic special relationship was "a partnership for a purpose and the engine of effective multilaterism". He put forward an ambitious agenda for Obama to pursue: arms reduction; peace in Afghanistan and Iraq; an urgent world trade deal; a climate change agreement by next year; a peace settlement in the Middle East; and a worldwide reflationary strategy to minimize the threat of recession.

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