Wednesday, June 24, 2009
CIA and Assassinations: The Guatemala 1954 Documents
Pensions crisis: 96% of final salary schemes are doomed... OAPs worst off in Britain... and state funds withering on the vine
The extent of the pensions crisis was laid bare yesterday by a 'triple whammy' of worrying reports.
Almost all blue-chip companies now admit their final salary schemes are 'unsustainable', according to a major survey.
At the same time, two separate studies said that Britain's state pension was the worst in the Western world.
The reports confirm that private sector workers face a bleak future, with the state handout withering on the vine and dozens of generous company schemes on the verge of being wound up.
However, most gold-plated public sector schemes - funded by the taxpayer - remain untouched.
Almost 90 per cent of state employees receive final salary pensions, compared with just 16 per cent in the private sector.
Opposition parties and campaign groups said last night that the three studies provided yet more evidence of the growing crisis in pension provision.
Liberal Democrat work and pensions spokesman Lord Oakeshott said: 'Gordon Brown has been in charge of our pensions for the past 12 years.
'He should be ashamed of these shocking statistics, showing Britain's miserable means-tested state pension right at the bottom of the world pension league.'
Prior to 1997, Britain's state pension pot was in relatively good health. But in one of his first acts as chancellor, Mr Brown scrapped the tax relief on dividends paid into pension funds, costing them around £100billion.
It triggered the shutdown of final salary schemes covering hundreds of thousands of workers.
Yesterday's 'triple whammy' of bad news comprised:
- A survey of 1,000 blue-chip companies by Pricewaterhouse Coopers, which found that 96 per cent believe their final salary schemes are unsustainable.
- A study by the influential Organisation for Economic Cooperation and Development (OECD), placing Britain at the bottom of a 'pensions' league table for those yet to retire.
- Research by the UK-based Office for National Statistics, which confirmed just how little the state pension is now worth.
The House of Lords also released a report yesterday criticising Chancellor Alistair Darling's Budget for removing a series of tax breaks on pension contributions.
Tory pensions spokesman Theresa May said: 'This is yet more bad news for cash-strapped pensioners who are the innocent victims of this recession.'
Some 16 per cent of the firms which responded to the PWC survey had already closed their final salary schemes to current members.
A further 55 companies said they intended to freeze their schemes for existing members within the next five years.
Meanwhile, the report from the OECD showed that younger British workers will get far less generous state payouts than their counterparts in France, Germany and Spain.
Those entering the labour market today can expect to receive a state pension worth just four times their average annual earnings of £31,500 over the course of their retirement.
In contrast, Germans will receive more than seven times their average salary, while the French will get more than nine times their annual pay.
The figures from the ONS, which measured how state pensions reflect previous salaries, revealed that Britain has the least generous arrangement of any OECD country. The basic state pension is just £95.25 per week for an individual and £152.30 for a couple.
Michelle Mitchell of Age Concern said: 'It's a national disgrace that more than two million UK pensioners are trapped in poverty.
'With British pensioners receiving one of the lowest state pensions in Europe, the Government must go further to improve the situation for the country's poorest older people.'
The latest round of dismal news comes as unemployment reached its highest level since the end of 1996 - just before Labour came to power.
Many workers are suffering from pay freezes, leaving little spare cash to save for their retirement.
Pensions minister Angela Eagle said last night: 'It's absolute nonsense to suggest this Government is not committed to pensioners.
'Measures such as pension credit and winter fuel payments mean that even the poorest pensioners in the UK are still better off than the poorest pensioners in other countries.'
王毅：台灣問題應透過兩岸協商共同解決
新華社報導，正在美國訪問的王毅今天在華盛頓會見美國布魯金斯學會、卡內基基金會和史汀生中心等美國智庫的著名學者，並進行座談交流。
王毅指出，當前兩岸關係已步入和平發展軌道，中美關係也呈現穩定發展局面。新形勢下，中美應當認真思考如何實現兩岸關係與中美關係的良性互動。
他說，兩岸關係保持發展勢頭，將減少中美關係複雜因素，有利於中美關係的健康發展。美國尊重中國在台灣問題上的核心利益，有助於兩國增強戰略互信與合作，也將為兩岸關係發展提供良好環境。
世銀：俄羅斯經濟今年將萎縮7.9%
世界銀行在一項報告中指出，「對於俄羅斯實體經濟與社會的衝擊也將大於幾個月以前的預期。2009年俄羅斯國內生產總值（GDP）將萎縮約7.9%。」
這個總部設於紐約的開發銀行今年3月公布的報告曾預測俄羅斯經濟今年將萎縮4.5%。
「經濟合作暨發展組織」（OECD）今天公布的一項報告也預估，俄羅斯經濟今年將萎縮6.8%，但明年將成長3.7%。
該組織說，「俄羅斯正面臨嚴重衰退，但商品價格反彈，以及刺激景氣措施預期將發揮的效果，將導致2009年景氣開始復甦，並延續至2010年」。OECD總部設在巴黎，俄羅斯並非其會員國。
台北國際食品展「三展合一」 清真館首次參展
貿協秘書長趙永全說，今年「2009台北國際食品展」、「台北國際食品加工、餐飲設備暨製藥機械展」及「台北國際包裝工業展」三展聯袂於南港展覽館展開。參展廠商達1147家、計2532個攤位，在不景氣中仍比去年成長近1%，誠屬不易。
貿協表示，台北國際食品展已是亞洲食品業界的年度盛事，今年邁入第19屆，從去年起移師南港館舉行。今年三展參展情況，食品展計825家廠商參展，使用1629個攤位，食機展167家廠商參展，使用479個攤位，包裝展亦有155家廠商參展，使用424個攤位。
看展國家情況方面，共計34國、700名買主預先登錄參觀，估計國外專業買主人數將超過4000人，國內相關業者參觀人次也將上看3萬名。
貿 協強調，今年食品展的國際化程度是歷來最高的一次，包含日本、美國、歐洲、中南美洲及東南亞與東北亞等國都有參與；其中日本館規模甚大，包含越光米、烏龍 麵、新鮮魚片等都有展出；美國館則有各類有機食品與冷凍疏果漁產等。墨西哥、秘魯及英國也展出異國風味香料、醬料及英式茶飲文化。
至 於參展廠商與買主一對一洽談的「2009年台灣優質食品採購商談會」，計有中國大陸、歐美、東北亞及東南亞等14國參與，合計100位採購高層來台。經濟 部國貿局局長黃志鵬說，據食品所執行產業技術知識服務計畫（ITIS計畫）估算，97年台灣的食品總產值達新台幣5264億元，較96年成長 10.46%，附加價值達到2111億元，成為台灣主要獲利產業。
One missing as hurricane Andres swipes Mexico
MEXICO CITY (AFP) — A fisherman was reported missing in heavy seas as the first Pacific hurricane of the season, Andres, swept up the western coast of Mexico.
In Miami, Florida, the US National Hurricane Center upgraded Andres from a tropical storm to a Category-One hurricane with sustained winds of 75 miles per hour (125 kilometers per hour).
Authorities in the western Mexican state of Guerrero said "the disappearance of a person who was fishing" was reported in the costal town of Tecpan de Galeana.
The hurricane was moving in a northwesterly direction parallel to Mexico's Pacific coast and was not expected to make landfall.
But it was expected to pass near the western state of Jalisco, where authorities went through seven municipalities warning residents to be prepared to go to shelters.
The US National Hurricane Center in Miami said Andres was expected to dump three to six inches of rain over west central Mexico before losing its punch in the coming days.
"Although Andres has become a hurricane today, weakening is forecast in the next day or two," it said.
North Korea warning suggests missile may not be headed toward Hawaii
North Korea issued a warning over the weekend to mariners of upcoming live-fire missile exercises. The exclusion zone cited in the notice covers a stretch in the Sea of Japan, 279 miles by 68.2 miles, off the coast of Wonsan, North Korea. The warning lasts from June 25 to July 10, from approximately 8 a.m. to 8 p.m. local time, a U.S. counterproliferation official said.
U.S. defense and counterproliferation officials say intelligence suggests that North Korea is likely to fire short- and medium-range missiles, based on the splashdown zone referenced in the notice and other activities that are consistent with such launches.
The officials spoke on condition of anonymity to discuss sensitive intelligence.
The Yomiuri Shimbun reported last week that North Korea was expected to test-fire a long-range ballistic missile by sending it in the direction of Hawaii.
In reaction, Defense Secretary Robert Gates ordered deployment of a ground-based mobile missile intercept system and a sea-based radar system to Hawaii. Together they could shoot down an incoming missile in midair.
Experts say North Korea has not yet built a ballistic missile that can reach Hawaii, which is about 4,500 miles from North Korea.
U.S. defense officials told Congress earlier this month they think North Korea is still three to five years away from being able to hit the West coast of the United States with a long-range Taepodong-2 missile.
U.S. officials said they have not seen preparations for the launch of a Taeopodong-2 missile similar to that launched on April 5.
It took North Korea about 12 days to stack and fuel that missile, which it claimed was a space-launch vehicle intended to put a satellite into orbit. It failed sometime in its second or third stages, splashing down into the ocean after traveling about 2,000 miles.
Pyongyang has also not mastered mounting a nuclear bomb on a long-range missile despite recently conducting its second underground nuclear test. The yield was estimated by U.S. intelligence as a "few" kilotons.
The communist regime has vowed to bolster its nuclear arsenal and threatened war to protest U.N. sanctions in the wake of its second nuclear test. It conducted its first nuclear test in October 2006, and there are suspicions it is preparing for a third.
新加坡‧腹痛誤診為性病‧少婦：醫生害我婚姻亮紅燈
（新加坡）一名少婦因腹部疼痛而求醫，並指醫生誤診為性病，導致丈夫與她冷戰，婚姻亮紅燈。
37歲少婦說，她是在6月初因腹部疼痛，加上白帶顏色有異，而到新加坡淡濱尼的一家婦產科診療所求醫。
“當時醫生只憑肉眼看了白帶顏色，就說我患了性病。我聽後頭腦頓時一片空白。”
更令少婦不滿的是，她指檢驗報告還未出來，醫生就要她和丈夫服藥，結果到頭來發現根本不是性病，丈夫氣得與她冷戰，令兩人的婚姻亮紅燈。
醫生：溝通出問題
另外，有關醫生解釋，因語言溝通出問題，才會造成誤解。
他說，因為少婦只懂華語，而他是受英文教育，使用華語解釋時有困難。
他說，在第一次看診時，他指少婦有發炎症狀，或許和性行為有關，因此她和丈夫都需要服藥。
“我還說需要等一週，檢驗報告出來後才能確定病情，我並沒有說她得了性病。我相信她或許是斷章取義，以為自己患上了性病。”
Big Oil Ready for Big Gamble in Iraq
BAGHDAD -- Next week, Iraqi officials plan a welcome-back party for Big Oil.
The government intends to auction off oil contracts to foreign companies for the first time since Iraq nationalized its oil industry more than three decades ago. If all goes according to plan in the first round, foreign oil companies will move in to help Iraq revive production at six developed fields that have suffered from years of war and neglect.
But Iraq's fractious politics have complicated the process. Some lawmakers and oil officials have called for a delay of the auction. The man behind the plan, Oil Minister Hussain al-Shahristani, appeared before parliament on Tuesday, where some lawmakers questioned the legality of the proposed contracts and what they called favorable terms for the foreign companies. But the auction appears to have sufficient political support to go ahead on schedule, and Mr. Shahristani and other government officials vowed to plow ahead.
Mr. Shahristani's oil deals are crucial to this war-torn country's economy. Iraq is thought to have one of the world's largest supplies of crude oil, with 115 billion barrels in proven reserves. But foreign know-how is key to its plans to boost oil output to four million barrels a day within four to five years, from 2.4 million barrels currently.
Despite security risks, Western oil companies are clamoring to get in. Iraq is still relatively unexplored, offering big companies a potentially easy-to-tap source of growth. Some are touting Iraq as the most important opening of petroleum fields since the discovery in 2000 of the giant Kashagan field in the Caspian Sea.
Some 120 companies expressed interest in bidding for the contracts at the June 29 and 30 auction, according to the oil ministry. Thirty-five companies qualified to bid, including Exxon Mobil Corp., Royal Dutch Shell PLC, Italy's Eni SpA, Russia's Lukoil and China Petroleum & Chemical Corp., or Sinopec. The six oil fields at stake are believed to hold reserves of more than 43 billion barrels. Foreigners won't get the most prized piece of the action -- ownership stakes in the reserves -- but will be paid fees for ramping up output.
Just over 20 of Iraq's roughly 80 known oil fields have been fully or partially developed, and most of its production comes from just three giants, North and South Rumaila and Kirkuk. Because lots of the black gold is considered relatively easy to extract, oil experts estimate that exploration and development in Iraq costs $1.50 to $2.25 a barrel, compared with about $5 in Malaysia or $20 in Canada.
"We're talking about a huge volume of crude flowing through their system for the companies who win the bids," says Samuel Ciszuk, IHS Global Insight's Middle East Energy analyst. "On the other side, Iraq desperately needs technology, and these companies can bring it."
But Mr. Shahristani, architect of the plan, is under attack from many quarters. Falling oil prices have triggered a budget crisis, and he is being blamed for not boosting production enough to make up the difference. Lawmakers and some oil officials, meanwhile, say the auction will give foreigners too much access to Iraq's resources. Mr. Shahristani also has been called to appear before parliament for questioning about alleged corruption and mismanagement at the ministry.
"He should not continue," says Jabber Khalifa al-Jabber, secretary of the parliament's powerful Oil and Gas Committee. "Let someone who is qualified do the job....I can't name one accomplishment."
Prime Minister Nouri al-Maliki's spokesman, appearing earlier this month with the oil minister, voiced confidence in him and reaffirmed that the auction would take place as scheduled.
In a recent interview, Mr. Shahristani, 66 years old, says he has done nothing wrong, and that lawmakers critical of him have a political agenda. He says he looks forward to answering questions from parliament about corruption and mismanagement.
"I'm not a political animal, and I don't enjoy politics," he says. "The only reason I've accepted and continue with my responsibility is to protect the Iraqi wealth from unclean hands."
Deals in Iraq often are reached over cups of tea late at night, but Mr. Shahristani doesn't like schmoozing. In a capital built on patronage, he has denied plum jobs to longtime friends. He's earned a reputation as a stickler for rules, including cumbersome purchasing regulations that other oil officials blame for slowing down Iraqi oil development. He has refused even small gifts, such as neckties, from visiting oil executives, he says.
In his three years as oil minister, Mr. Shahristani has emerged as a key lieutenant to Mr. Maliki. After violence started to ebb in Iraq in 2008, Messrs. Maliki and Shahristani and a handful of other former Iraqi exiles have pushed an ambitious set of economic reforms.
Western oil companies were kicked out of Iraq in 1972, part of a wave of Mideast petroleum nationalization. Oil production hit at least three million barrels a day before Iraq invaded Kuwait in 1990, then fell sharply to 300,000 barrels after economic sanctions and trade embargoes were imposed. Production rebounded to about 2.5 million barrels before the U.S. invasion in 2003.
![[Big Oil Ready for Big Gamble in Iraq]](http://s.wsj.net/public/resources/images/P1-AQ416_IRAQOI_NS_20090623183626.gif)
Iraqi lawmakers have squabbled for years over a draft petroleum law that would set a legal framework for foreign companies to start drilling again. Tired of waiting, Mr. Shahristani in 2008 unilaterally invited oil companies to bid on contracts. Because global companies are reluctant to explore undeveloped fields in Iraq without an oil law, Mr. Shahristani has focused on getting foreign help pumping from existing fields. "We have done what we can with our national resources, and now we need outside help," he says.
He says the contracts don't need approval from parliament, though he insisted they fit the conditions outlined in the draft oil law, which is now being redrafted in the cabinet. Some of the terms, he says, are particularly beneficial to Iraq: Winners of the auction must fork over hundreds of millions of dollars of cash in upfront loans to the government.
Mr. Shahristani, who grew up in Karbala in a prominent, religious family, is a nuclear scientist by training. After studying in Moscow and spending time in London, he earned masters and doctorate degrees in nuclear chemistry at the University of Toronto. In 1978, he became chief adviser to the Iraqi Atomic Energy Commission.
Saddam Hussein had consolidated power and become president. According to Mr. Shahristani and others, he wanted a nuclear weapon. In a face-to-face meeting with Mr. Hussein, Mr. Shahristani reminded him that Iraq had signed a nonproliferation treaty and was bound by it. Mr. Hussein told him to concentrate on science and leave politics to him, according to Mr. Shahristani and two other scientists at the meeting.
A few days later, in December 1979, security officials took him to Iraq's Internal Security facilities, where he was tortured for three weeks, he says. Mr. Shahristani says his torturers offered him palaces and riches if he would reconsider his refusal to work on nuclear weapons. He declined and was put into solitary confinement, where he remained for 10 years, he says. "But I never lost my will, I never lost my faith," he says.
In 1990, he was released from solitary confinement. A year later, the U.S. bombardment of Baghdad during the first Gulf War sowed chaos at the prison. Another inmate stole some intelligence-corps uniforms and arranged for a getaway car.
One evening, Mr. Shahristani and two others managed to evade guards, duck into a storage room and put on the stolen uniforms. After hiding for several hours, they snuck past some visiting intelligence officers playing cards and hustled out the prison gate.
They met up with their families and snuck across the border into Iran. For the next few years, Mr. Shahristani helped Iraqi dissidents and refugees. In 1995, he and his wife, a Canadian, set up the Iraqi Refugee Aid Council. He became an outspoken critic of Mr. Hussein's regime and of nuclear proliferation.
After U.S. troops poured into Baghdad in April 2003, he returned. He was identified by American officials as a top contender for the prime minister's job. He declined the position because it wasn't an elected one, he says, instead becoming deputy speaker of Iraq's parliament.
Around that time, Mohammed Baqir, a family friend who had helped Mr. Shahristani escape from prison, asked for his help in finding government jobs for relatives. Mr. Shahristani refused. "Shahristani's problem is he is too straight and clean," Mr. Baqir says. "As a politician, you need to be flexible."
After a new government led by Mr. Maliki was formed in 2006, the prime minister named him oil minister. His new ministry, like other government agencies at the time, was overrun by militia members, and corruption was rampant, according to Mr. Shahristani and other current and former oil officials.
Over the next two years, hundreds of ministry employees were murdered or kidnapped. By the end of 2007, many top technocrats had fled the country, and various political parties had filled the ministry with patronage employees, according to Mr. Shahristani and the other officials.
Mr. Shahristani fired 250 members of the ministry's security staff thought to be militia members, and replaced top security officials with people he trusted. He turned over evidence of wrongdoing to the ministry's inspector general, and fired or transferred those suspected of malfeasance.
"Before, there was lots of interference in the ministry from political blocs, but he got rid of all that," says Abdul Mahdy al-Ameedi, head of the ministry's contracts department.
The purge stirred resentment. Some employees claimed they were wrongly targeted. Others accused Mr. Shahristani of being too by-the-book. He cracked down on absenteeism and introduced a card-scan check-in system. He scaled back bonuses.
But boosting oil production significantly proved difficult. Insurgents were attacking pipelines and refineries. Without a legal framework in place, foreign companies were reluctant to come to Iraq. The oil law stalled in parliament.
An impatient government in the semiautonomous Kurdish north decided to move without Baghdad. In September 2007, Kurdish officials signed a deal with Texas-based Hunt Oil Co.
Mr. Shahristani criticized the deal, saying it had no legal standing. The Kurdish government accused him of moving too slowly, and pressed ahead with its deal.
![[Big Oil to Pounce on Iraq's Big Fields]](http://s.wsj.net/public/resources/images/P1-AQ415_IRAQOI_NS_20090623183615.gif)
A Western official in Baghdad who has dealt with Mr. Shahristani says he and others advising the government agreed that Mr. Shahristani was moving too slowly. Oil prices were sky-high, and foreign oil executives were eager to get into Iraq. The country needed a "wheeler-dealer type," this official says.
Recently, he dropped his longtime opposition and allowed the Kurdish government to begin exporting oil. He yielded after the Kurds agreed to have Baghdad's central government receive payments for the exports.
In this month's auction, Western firms also are competing to develop two natural-gas fields. All these deals are so-called technical-service contracts. Essentially, Iraq will pay companies a fee for boosting output. The contracts will last 20 years. Oil executives would prefer "production sharing" agreements, which give companies a share of profits, and typically allow them to book new reserves. They are nonetheless eager to get their feet in the door. Mr. Shahristani says companies that offer the lowest costs and most profit for Iraq will win. If the auction succeeds, the winners are expected to begin work in November.
The Oil Ministry is planning a second round of bidding, to cover oil fields that have been explored but not fully developed. Nine of the 38 companies that applied to participate have been chosen as bidders. Those contracts will be awarded at the end of this year.
Mr. Shahristani's term ends when a new government is formed after elections early next year. He plans to return to the Iraqi National Academy of Science, which he established in 2003. "I am not a politician," he says.
—Munaf Mustafa and Jabbar al-Obedi in Baghdad contributed to this article.By GINA CHON
Leading Chinese Activist Formally Charged
![[Liu Xiaobo]](http://s.wsj.net/public/resources/images/OB-DX844_carres_D_20090624032008.jpg)
Reuters
Veteran Chinese pro-democracy activist Liu Xiaobo in a March 1995 file photo.
Mr. Liu has been in police custody since they took him away on Dec. 8, a day before the political document was released.
"Liu has been engaged in agitation activities, such as the spreading of rumors and defaming of the government, aimed at subversion of the state and overthrowing the socialism system in recent years," Xinhua News Agency quoted a Beijing police statement as saying.
It gave no other details. Mr. Liu's lawyer said he has not been informed officially of the charges.
It marks the highest-profile arrest of a Chinese dissident since human rights activist Hu Jia was detained last year ahead of the Beijing Olympics. Mr. Hu was sentenced to 3 1/2 years in prison for sedition last April.
China has always reacted sharply to any challenges to its one-party system, but is also cracking down on any dissent ahead of a gala celebrating the communist regime's 60th anniversary on Oct. 1.
Mr. Liu's lawyer, Mo Shaoping, said he was only made aware of the Xinhua report when journalists started calling him for confirmation.
According to Xinhua, police have obtained permission from the courts to arrest Mr. Liu on suspicion of committing a crime. Mr. Mo said this indicates the investigation into Mr. Liu's case is still continuing and that he has yet to be formally charged. The next step would be indictment.
Agitating to subvert is a less serious charge than subversion and can be punished with five years in prison or less, or a period of deprivation of political rights, Mr. Mo said. Subversion carries a maximum sentence of life in prison.
Mr. Liu, 53, is a former university professor who spent 20 months in jail for joining the 1989 student-led protests in Tiananmen Square.
In his writings, most published only on the Internet, Mr. Liu has called for civil rights and political reform, making him subject to routine harassment by authorities.
He was among more than 300 lawyers, writers, scholars and artists who signed "Charter 08" in December calling for a new constitution guaranteeing human rights, election of public officials, freedom of religion and expression, and an end to the Communist Party's hold over the military, courts and government.
Police detained Mr. Liu a day ahead of the charter's release, possibly because they considered him a key organizer, in addition to his role in drafting and revising the document, Mr. Mo has said.
The singling out of Mr. Liu for prosecution also seems to be an effort to warn others involved in the charter. Other signatories have been called in for talks with police but not arrested. A Peking University law professor, He Weifang, was reassigned to a post in the far western Xinjiang region after signing the document in an apparent rebuke.
Earlier this month, the leader of the U.S. House of Representatives, Democrat Nancy Pelosi, called for Mr. Liu's "immediate and unconditional release." She also wrote a letter to Chinese President Hu Jintao last month asking that Mr. Liu and other Chinese "prisoners of conscience" be released.
Mr. Liu has been held in an unknown location since December. The San Francisco-based Dui Hua Foundation said earlier this month he was being kept at a hotel on the outskirts of Beijing – a claim that could not be verified.
Chinese law limits such "house arrest" to six months and Mr. Mo demanded on June 8 that Mr. Liu be released immediately, saying that it was illegal to hold him any longer.
Metro urged in '06 to retire rail cars that crashed
The National Transportation Safety Board recommended three years ago that Metro replace or refurbish the type of train car involved in Monday's fatal crash - a suggestion that the District's heralded transit agency failed to aggressively follow.
The day after the deadliest crash in Metro's 33-year-history was filled with more questions about what caused one Red Line train to slam into a stopped train Monday evening near the Fort Totten station, killing at least nine people and injuring about 80.
Revisiting the crash
The investigation into Monday's fatal Metro crash that killed nine people is focusing on radarlike sensors that failed to alert a red line train that other trains were stopped on the track, John B. Catoe Jr., the agency's general manager, said Tuesday morning.
Mourners held a prayer service outside the transit agency's headquarters in Northwest, and federal investigators briefed Metro's board of directors on details of the horrific accident.
D.C. fire officials turned over control of the crash scene in Northeast to the National Transportation Safety Board at 1 p.m. Board member Debbie Hersman said investigators already had determined that the moving train had been in automatic mode at the time of the crash and that the train's emergency brake was engaged, although it was not clear whether it was depressed prior to the crash by operator Jeanice McMillan, who was killed in the accident.
Ms. Hersman said that the crash occurred on a curved portion of the track where speed was restricted and that maintenance had been performed on the train-control system - a computerized sensor system that can alert a train that other trains are stopped on a track - between Fort Totten station and New Hampshire Avenue overpass earlier this month.
She said investigators also planned to study Ms. McMillan's work history, medical records and toxicology reports, along with cell phone records and nine recorders pulled from the stopped train.
"We're going to leave no stone unturned," she said.
Metro General Manager John B. Catoe Jr. likened the computerized sensor system to an air-traffic-control system and said it can stop trains when a problem occurs on a track. He said the system also has a mechanical override that did not engage during the afternoon rush-hour crash Monday, but he declined to speculate on why it did not engage.
Mr. Catoe also discounted reports that the moving train that caused the crash was overdue for scheduled maintenance, saying all documentation had been handed over to NTSB investigators.
中國‧北京逮捕劉曉波‧罪名：涉煽動顛覆國家政權
（中國‧北京）中國官方媒體報導，中國著名異見人士劉曉波已正式被當局以“涉嫌煽動顛覆國家政權”罪名逮捕。
新華社今日（週三，6月24日）報導，檢察機關週二（6月23日）批准逮捕劉曉波，指他“涉嫌旨在顛覆政府和推翻社會主義制度的煽動活動”。
中國著名異見人士劉曉波（左）週二（6月23日）正式遭中國當局以“煽動顛覆國家政權”罪名逮捕。圖為劉曉波與妻子的檔案照。（圖：法新社）
新華社引述北京公安局在聲明中指出：“近年來，劉曉波以造謠、誹謗等方式煽動顛覆國家政權、推翻社會主義制度，違反了《中華人民共和國刑法》，涉嫌煽動顛覆國家政權罪。”
這意味劉曉波將面對審訊。
罪成或判入獄15年
劉曉波的律師毛少平說，如被判有罪，劉曉波可能面對最高15年的有期徒刑。毛少平說，此案仍在調查階段。
新華社報導指出，劉曉波“經初步審查，已對公安機關指控的犯罪事實供認不諱”。
但劉曉波的家人和朋友表示，劉曉波因和平表達意見卻遭到不公平迫害。
去年被扣只見妻子2次
劉曉波的妻子通過電話向路透社表示：“曉波要北京公安局一名公安轉告我，不要太過擔心……（但）我非常擔心。他已經被捕。他們將起訴和審判他。”
自劉曉波去年12月被扣留以來，他的妻子曾見過他2次，稱他瘦了許多，但身體仍健康且心情平靜。
你知道嗎？
劉曉波因“八九民運”入獄
53歲的劉曉波曾因參與“八九民運”而入獄，1996年再度被捕。
去年12月他與300多名律師、作家、學者和藝術家聯名簽署《零八憲章》，要求中國政府保護人權，公開選舉官員，言論和宗教自由，結束共產黨對軍隊、法庭和政府一黨控制。
劉曉波是在《零八憲章》發表前夕被捕的。他於去年12月起遭拘留，7個月來一直處於“監視居住”狀態，據人權組織說他一直被扣留在北京郊區的一個酒店裡。
劉曉波是中國著名作家，一直對政府發表辛辣批評，在海外中文網站上刊登文章。劉曉波也協助創立獨立中文筆會，反對當局對作品進行審查和政治管制。
美國‧與英互逐外交官‧奧巴馬強烈譴責‧伊朗與西方關係緊張
（美國‧華盛頓）美國總統奧巴馬週2強烈譴責伊朗當局“非正義地”鎮壓反政府示威份子。這是奧巴馬對伊朗事態發展至今最嚴厲的回應。
與此同時，伊朗把2名英國外交官從首都德黑蘭驅逐出境之後，英國也“以牙還牙”，驅逐2名伊朗外交官。
伊朗反政府示威演變成外交風波，伊朗與英國互相驅逐外交官員。伊朗強硬派學生今日（週三，6月24日）在英國駐德黑蘭大使館外焚燒美國與英國國旗。（圖：法新社）
伊朗責西方干政
伊朗近日指責美英等西方國家，干涉伊朗內政，煽動國內暴亂。
奧巴馬此前對伊朗局勢一直保持克制，以致被共和黨人指責太過怕事，奧巴馬週二（6月23日）態度急遽轉變，宣稱自己對伊朗當局威脅、毆打和監禁示威者，感到“震驚與憤怒”。不過，他否認否認干涉伊朗事務。
他當天在白宮召開的新聞發佈會上暗示，伊朗領導人如果繼續“威脅、毆打及監禁”示威份子，將面對接下來的後果。
但他卻一再拒絕說明，美國將可能採取甚麼樣的行動，目前仍保留透過外交途徑，與伊朗領導人處理核計劃課題。
奧巴馬責鎮壓異見人士
奧巴馬也譴責伊朗當局鎮壓異見人士。他特別提到了，近日在互聯網廣泛流傳的26歲女孩妮達被民兵鎗殺的視頻。妮達現在已經成為伊朗抗議的象徵。
奧巴馬指，違反人權的舉動正在伊朗發生。
他說：“沒有一隻鐵腕能阻止世界目擊一場正義的和平示威。歷史將永遠站在那些為正義而戰的人那一邊”。
白宮也特別在網站上張貼了一個以波斯文翻譯奧巴馬針對伊朗局勢談話的視頻。
白宮也另外貼了一份波斯文的奧巴馬講稿，同時也在微網誌Twitter、@whitehouse等官方網站，張貼有關波斯文講稿的聯結。
布朗：伊朗逐外交官不公義
在倫敦，英國首相布朗週二在國會宣佈，將伊朗外交官逐出倫敦。伊朗此前指責英國外交人員“從事不符合外交官員地位的活動”。
布朗表示，這是回應伊朗的做法，並指有關指控毫無根據。
他說：“伊朗週二以毫無根據的指稱作為理由，把兩名英國外交官驅逐出境，是不公義的做法。作為回應，我們在今日（週三，6月24日）通知伊朗大使館我們要把2名伊朗外交官驅逐出倫敦伊朗使館。”
布朗的發言人指，兩國的外交官員目前都有一週的時間準備離開。
這名發言人稱，外交部週二傳召伊朗大使莫瓦赫迪安，並告訴有關決定。
英國外交部沒有說明被伊朗驅逐出境的英國外交官的身份，僅說英國大使不是其中一人。
英國外長米利班德稱，伊朗沒有驅逐英國外交官的原由，但稱對一個歐洲國家的羞辱是對所有歐洲國家的羞辱。
伊朗最高精神領袖哈梅內伊上週指外國勢力干預伊朗內政，特別點名英國是“最奸詐的”的敵人。
中國‧美歐責限制原材料出口‧中辯稱沒違WTO規定
（中國‧北京）中國今日（週三，6月24日）表示，中國限制原材料出口，並沒有違反世界貿易組織（WTO）的條規。
美國與歐盟週二（6月23日）就中國限制原材料出口，向WTO提起申訴，稱中國實行的政策明顯偏向於國內生產商。這是奧巴馬去年11月上任後，第一次向WTO投訴中國。
對此，中國商務部傳真一份聲明稱：“中國實施相關出口政策的主要目的，是為了保護環境與天然資源。中國相信，有關引發爭議的政策是遵守WTO的規定的。”
這是中國針對美歐投訴作出的第一個回應。
上述貿易爭端涉及的原材料包括礬土、焦炭、氟石、鎂、錳、金屬硅、金剛砂、黃磷和鋅。
商務部也稱，當局將“妥善地處理”華盛頓及布魯塞爾的申訴。中國有10天的時間對申訴作出回應。
美國貿易代表柯克稱：“但願我們所有伙伴都明白，我們對此課題很認真。”
他說：“我們所有人都會說類似我們不要採取保護主義政策這類的話，但是，我們必須付諸行動。”
美國指責，中國通過限制這些原材料的出口，偏袒國內生產商。
柯克稱：“我們最感到不安的是，這顯然是蓄意政策，為中國國內的生產商提供不公平的優勢，讓中國公司能以較低廉的價格購買原材料。”
台灣‧傳10恐怖份子圖混入境‧2大賽保安升級
（台灣‧台北）今年在台灣舉辦的“世界運動會”和“聽障奧運”驚傳成為國際恐怖份子的潛在攻擊目標！
據台灣壹週刊報導，早前在審查高雄世運來台人員名單中，竟發現有近10名在國際間已遭列管的恐怖份子申請來台；雖已被拒絕入境，但“國安”、情治、警政及境管單位已對此事全面加強警戒，入境管制也已升高到最嚴密防護等級。
主辦世運會的高雄市長陳菊，5月赴北京會見中國奧會主席劉鵬，談到高雄世運的維安很有自信地表示，維安工作保證做到滴水不漏。
而擔任這次世運會維安的總指揮官、內政部長廖了以也再次強調，絕對會將可疑恐怖份子拒於境外，務必做到維安滴水不漏。
今日（週三，6月24日）面對媒體追問是否真的有恐怖份子混進台灣，意圖破壞高雄世運，廖了以不願證實也不願否認消息是否正確，只表示“阻絕於境外”是最高原則。
中國‧中國最年輕‧輿論、嘩然、質疑‧29歲新市長惹非議
（中國‧北京）今年29歲的清華大學畢業生周森鋒近日以全票當選湖北宜城市市長，成為中國最年輕的縣級市長，但卻引發輿論的爭議。
與此同時，在週二（6月23日），有網民貼出一張他下鄉視察時相片，相中他站在田間背著手，有工作人員為他打傘的相片，網民狂轟“官老爺的作風學得也太快了吧！”
媒體和網民熱議
29歲的周森鋒6月21日，全票當選湖北宜城市新市長，成為湖北省、同時也是中國目前年齡最小的縣級市市長。消息公佈後引起媒體和網民熱議，不乏質疑之聲，有懷疑他有後台，有批評湖北當局越級提拔，違反了中共黨政幹部選拔任用條例規定。
針對有網民懷疑周森鋒靠特殊背景才陞遷如此之快，宜城市的上級襄樊市委澄清，指周是他們從清華大學引進的人才，並無政治背景，家在農村。
但由於官方對周森鋒介紹十分簡略，官方的澄清並沒有排除輿論的質疑。
輿論對於周森鋒的“仕途大躍進”主要有2點質疑：一是周森鋒為甚麼研究生剛畢業就被任命為副處級官員？要知道絕大多數行政人員在縣市幹一輩子也熬不到副處級待遇；二是周森鋒做出了甚麼具體政績，讓他以“全票”當選宜城市市長？
官方以及周森鋒的同事對他的超常擢升也語焉不詳，十分空泛，說他在市建委工作時，對市建委管理工作做了不少有益的探索；在規劃局工作雖然時間不長，但工作得心應手，成績有目共睹。有同事說他在市建委工作時經常在小餐館吃飯，還算有點實質內容。
《新京報》週二發表評論說，周森鋒的簡歷裡並未透露他曾經在這個地區有何出色的建樹與業績。縱觀他的職業生涯，基本都是擔任副職的經歷讓人很難理解為甚麼會“全票”通過而擔任了市長。
媒體紛大揭底
網民抨擺官威
連日來，中國媒體紛紛到周森鋒工作學習地方“大起底”，披露他確實出身農村平凡家庭，父母都是 農民，在當地瓷磚廠打工，一名弟弟也考入清華大學，目前讀研究生；中學老師指，周森鋒讀書時很勤力，“不服輸”。上大學的費用多靠自己打工掙錢，基本上沒 讓父母承擔。而周森鋒的同事則指，他“每一次進步都是自己奮鬥出來的”，例如他任規劃局副局長時，利用自己的專業學識，很快進入角色，為當局解決了不少問 題。
不過，中國著名網站凱迪社區週二（6月23日）貼出一張據指是周森鋒下鄉視察的照片，相中他背手站在菜田間，笑咪咪對著鏡頭，背後有工作人員為他打傘。
相片被中國多個網站轉貼，網民議論紛紛：“天又沒有下雨，好牛氣！就你的皮膚嬌嫩！”“真有派 頭！這樣就能顯示出官威了？”有網民更指，“他明知道有人照相，還特意擺出POSE，可見看出，腦海是怎麼想的！”“這種官老爺作風，學的也太快了一點 吧？”也有網民指，“工作5年換了這麼多地方，一個地方就做幾個月，這樣的升遷，太讓人起疑了！”
周森鋒小檔案
年齡：29歲
原籍：河南省禹州市神後鎮農村
學歷：
上海同濟大學（本科，2002年畢業）
北京清華大學（碩士，2004年畢業）
經歷：
2004年7月-07年11月襄樊市建委副主任
2007年11月-08年8月襄樊市規劃局副局長
2008年9月-09年6月宜城市（屬襄樊市管轄）副市長、代市長
2009年6月21日開始宜城市市長
Obama talks tougher on Iran, says US 'appalled and outraged' at violence
WASHINGTON - Dramatically hardening the U.S. reaction to Iran's disputed elections and bloody aftermath, President Barack Obama on Tuesday condemned the violence against protesters and lent his strongest support yet to their accusations the hardline victory was a fraud.
Obama, who has been accused by some Republicans of being too timid in his response to events in Iran, declared himself "appalled and outraged" by the deaths and intimidation in Tehran's streets - and scoffed at suggestions he was toughening his rhetoric in response to the criticism.
He suggested Iran's leaders will face consequences if they continue "the threats, the beatings and imprisonments" against protesters. But he repeatedly declined to say what actions the U.S. might take, retaining - for now - the option of pursuing diplomatic engagement with Iran's leaders over its suspected nuclear weapons program.
"We don't know yet how this thing is going to play out," the president said. "It is not too late for the Iranian government to recognize that there is a peaceful path that will lead to stability and legitimacy and prosperity for the Iranian people. We hope they take it."
Obama borrowed language from struggles throughout history against oppressive governments to condemn the efforts by Iran's rulers to crush dissent in the wake of June 12 presidential elections. Citing the searing video circulated worldwide of the apparent shooting death of Neda Agha Soltan, a 26-year-old young woman who bled to death in a Tehran street and now is a powerful symbol for the demonstrators, Obama said flatly that human rights violations were taking place.
"No iron fist is strong enough to shut off the world from bearing witness to peaceful protests of justice," he said during a nearly hourlong White House news conference dominated by the unrest in Iran. "Those who stand up for justice are always on the right side of history."
The eighth extended news conference of Obama's presidency also veered into the intricacies of the U.S. health care reform debate, the effectiveness of the economic stimulus package and a revealing personal moment in which he acknowledged he still is an occasional smoker despite trying to quit.
The past 10 days in Iran have posed the strongest challenge to that nation's clerical rule since the system was established 30 years ago in the 1979 Islamic revolution. Before Tuesday, Obama mostly kept to a modulated response, calculating that, given Iranians' distrust of American involvement in their country, anything viewed as internal meddling from the White House would do the demonstrators more harm than good.
He also is deeply interested in preserving his promised policy concerning Iran and the threat its nuclear program poses: He contends the danger has only grown through decades of ruptured diplomatic relations between the U.S. and Tehran, particularly in the past eight years under President George W. Bush, and it is time to try to change that by re-establishing direct talks.
But Obama has been taken to task by some Republicans, accused of being too passive. Even with Iran's blackout of foreign press and attempted communications shutdowns, chaotic images of riot police beating and shooting protesters have seized the world's attention. At least 17 people have been killed.
Last Sunday, Sen. Lindsey Graham, a Republican, said: "The president of the United States is supposed to lead the free world, not follow it. He's been timid and passive more than I would like."
Obama chose a less cautious approach on Tuesday, more directly challenging Iran's leaders to ease off and holding out the possibility of consequences if they do not.
"The Iranian government should understand that how they handle the dissent within their own country, generated indigenously, internally, from the Iranian people, will help shape the tone, not only for Iran's future, but also its relationship to other countries," Obama said.
He made clear that one recent overture to Iran - the authorization for U.S. embassies to invite Iranian officials to July 4 Independence Day parties - was likely to disappear without changes. "That's a choice the Iranians are going to have to make," Obama said.
With an array of U.S. sanctions already in place against Iran, there are few options at Obama's disposal other than withdrawing his offer to talk. Regardless, Obama said it is too early for him to be more specific. "We are going to monitor and see how this plays itself out before we make any judgments about how we proceed," he said.
Obama was plainer than ever that the protesters' beliefs that the election was stolen from opposition candidate Mir Hossein Mousavi may be legitimate. The government declared an overwhelming re-election victory for President Mahmoud Ahmadinejad and, while promising to look into scattered reports of irregularities, has ruled out annulling those results.
"We can't say definitively what exactly happened at polling places throughout the country," Obama said. "What we know is that a sizable percentage of the Iranian people themselves, spanning Iranian society, consider this election illegitimate. It's not an isolated instance, a little grumbling here or there. There is significant question about the legitimacy of the election."
In Obama's comments, there also was a notable shift away from previous respectful references to Iran's most powerful cleric, Ayatollah Ali Khamenei, as the "Supreme Leader." Obama didn't use the term on Tuesday.
Asked if his stronger language was influenced by pressure from Republicans such as Graham and Sen. John McCain, Obama scoffed: "What do you think?" And he shot back at Republican critics: "Only I'm the president of the United States."
Advisers realize the new tone poses a risk that the U.S. president will become a scapegoat for Iran's leaders - just what Obama has sought to avoid. Administration officials, speaking on condition of anonymity to describe a sensitive strategy, said the disturbing images of the past few days warranted the tougher stance.
"I congratulate him for that, and we need to keep the pressure on them," House Minority Leader John Boehner, said after the news conference.
-
AP National Security Writer Anne Gearan contributed to this story.
Citigroup Has a Plan to Fatten Salaries
The troubled banking giant, which to many symbolizes the troubles in the nation’s financial industry, intends to raise workers’ base salaries by as much as 50 percent this year to offset smaller annual bonuses, according to people with direct knowledge of the plan.
The shift means that most Citigroup employees will make as much money as they did in 2008, although some might earn more and others less. The company also plans to award millions of new stock options to employees in an effort to retain workers and neutralize a precipitous drop in the value of their stock holdings.
Like Citigroup, financial companies, like Bank of America and Morgan Stanley, are raising employees’ base salaries to try to shift attention away from bonuses and curb excessive risk-taking. So are banks like UBS and other European competitors.
The Citigroup proposals, discussed internally this week, present a crucial test for the Obama administration, which has vowed to rein in runaway compensation at companies that have received large taxpayer-financed bailouts. Citigroup has gotten not one but two rescues from Washington. Soon the government will assume a 34 percent stake in the company, whose share price has plunged nearly 84 percent in the last year.
Despite Washington’s new role at Citigroup, and public anger over big paydays on Wall Street, administration officials have little power to prevent the company and others in the industry from raising salaries for rank-and-file employees.
Kenneth R. Feinberg, the administration’s new “pay czar,” has the authority to set compensation for only the top 100 employees at troubled companies. The rest — which at Citigroup, means fewer than 300,000 people — can be paid as executives see fit, provided any increase does not rank them among the 100 most highly paid workers.
Outsize pay on Wall Street, particularly the industry’s bonus culture, is widely seen as having encouraged the risk-taking that led to the gravest financial crisis since the Depression. But industrywide, total compensation is expected to rise 20 to 30 percent this year, approximately to the levels of 2005, before the crisis, according to Johnson Associates, a compensation consulting firm. Total industry pay would still be below the record levels of 2007, but only a bit.
“You can say it is outrageous,” said Alan Johnson, the president of the firm. “But maybe it’s a little like the canary in the mine, and you say that things are getting better.”
Indeed, despite the simmering anger over Wall Street pay, some of the 10 big banks that repaid their federal aid this month — a big step toward disentangling themselves from the government — are gearing up to pay outsize bonuses. For many, profits are up, despite the troubled economy. On Monday, Goldman Sachs, which returned $10 billion of bailout funds, denied reports that it planned to pay out the highest bonuses in its 140-year history.
Mr. Feinberg, the special master for compensation, is the person who ensures that companies receiving federal bailout money are abiding by executive pay guidelines. This week, Mr. Feinberg, who oversaw the federal government’s compensation fund for victims of the Sept. 11, 2001, terrorist attacks, held introductory meetings with Citigroup executives and their counterparts at several other companies that have received two federal bailouts. He will start reviewing pay packages for the 25 highest-paid employees, as well as compensation formulas for the next 75, in the next two months. He declined to comment on Tuesday.
For months, Citigroup executives have sought guidance from the Treasury Department about how to alter compensation. But after reviewing the new rules, the bank determined it did not need Mr. Feinberg or other government officials to sign off on pay for the rank and file. While Mr. Feinberg can request information on the pay polices at financial companies that have received two federal bailouts, the companies can reject his guidance.
Citigroup executives are so eager to keep employees from fleeing, that in some cases, they are offering them guaranteed pay contracts. Managers began notifying bank employees of the proposed changes this week. They could take effect shortly.
For some Citigroup investment bankers and traders, the changes could mean salary increases of as much as 50 percent, depending on their position. Legal and risk management employees, as well as those in the credit card and consumer banking units, whose pay is typically skewed toward salary, rather than bonuses, are expected to receive smaller increases.
Citigroup executives said the changes were aimed at retaining employees. Some Citigroup workers have already left for small, boutique investment banks or large rivals that are not so beholden to the government.
Citigroup officials declined to discuss the issue on the record, given its sensitive nature. But they said that the changes would bring the bank’s compensation plan in line with the widespread view on Wall Street that bonuses were not one-time payouts, but rather a form of deferred salary. They said the new system would let them adjust bonuses more sharply to reflect employees’ performance.
Stephen Cohen, a Citigroup spokesman, said that any changes would be intended to adjust the balance between salaries, which are fixed, and bonuses, which vary from year to year.
Citigroup also plans to introduce a new stock option program later this year. Under the plan, it will award employees one stock option for every share of restricted stock they have accumulated. The program could open the floodgates for the release of tens of millions of stock options that could be cashed out over the next three years.
It is unclear what the strike price will be. But the hope is that the options program will give employees another incentive to stay despite offers from rivals.Police discover unrest HQ in Tehran
 |
Unrest in Tehran |
The Intelligence and Security Department of the Tehran Police has declared that the building -- located on Tehran's Haft-e-Tir Square -- was investigated on Monday night after a search warrant was obtained, IRNA reported.
The plotters have been arrested and are currently under investigation.
Documents found in the building indicate an ongoing plot against Iran's security was being implemented, the police said in a statement.
“After scrutinizing the building, which was the campaign office of a presidential candidate, it was discovered that the organization of illegal gatherings, the promotion of unrest, and efforts to undermine the country's security were carried out from the building,” the statement added.
Evidence has been found in the building that reveals the role of foreign elements in planning post-election unrest.
The building has in fact been a “headquarters for a psychological war against the country's security,” the police said.
The building, sources told Press TV, was used by a Mir-Hossein Mousavi election campaign.
The U.S. and the U.K. Will Both Default on Their Debt by the End of Summer
(1) At this stage of the global systemic crisis' process of development, contrary to the dominant political and media stance today, the LEAP/E2020 team does not foresee any economic upsurge after summer 2009 (nor in the following 12 months)
(2) On the contrary, because the origins of the crisis remain unaddressed, we estimate that the summer 2009 will be marked by the converging of three very destructive rogue waves.
(3) illustrating the aggravation of the crisis and entailing major upheaval by September/October 2009. As always since this crisis started, each region of the world will be affected neither at the same moment, nor in the same way
(4) However, according to our researchers, all of them will be concerned by a significant deterioration in their situation by the end of summer 2009
This evolution is likely to catch large numbers of economic and financial players on the wrong foot who decided to believe in today's mainstream media operation of "euphorisation�.
In this special Summer 2009 edition, our team describes in detail these three converging rogue waves and their impact, and gives a number of strategic recommendations (currencies, gold, real estate, bonds, stocks, currencies) to avoid being swept away in this deadly summer.
LEAP/E2020 believes that,
(5) instead of green shoots (those which international media, experts and the politicians who listen to them kept perceiving in every statistical chart in the past two months),
(6) what will appear on the horizon is a group of three destructive waves of the social and economic fabric expected to converge in the course of summer 2009, illustrating the aggravation of the crisis and entailing major changes by the end of summer 2009… more specifically, debt default events in the US and UK, both countries at the centre of the global system in crisis. These waves appear as follows:
1. Wave of massive unemployment: Three different dates of impact according to the countries in America, Europe, Asia, the Middle East and Africa
2. Wave of serial corporate bankruptcies: companies, banks, housing, states, counties, towns
3. Wave of terminal crisis for the US Dollar, US T-Bond and GBP, and the return of inflation
In fact, these three waves do not appear in quick succession like the sisters rogue waves. They are even more dangerous because they are simultaneous, asynchronous and non-parallel. Hence their impact on the global system accentuates the risks because they hit at various angles, at different speeds and with varying strength. The only certain thing at this stage is that the international system has never been so weak and powerless to face such a situation. The IMF and global governance institutions' reforms announced by the London G20 are at a standstill
(7) The G8 becomes more like a moribund club whose utility is increasingly questioned
(8) US leadership is the shadow of what it used to be, mostly concerned by desperately trying to find purchasers for its T-Bonds
(9) The global monetary system is in a process of disintegration, with the Russians and Chinese in particular accelerating their positioning in the post-Dollar era. Companies foresee no improvement in the business climate and speed up the pace of layoffs. A growing number of states falter under the weight of their accumulated debt created to "rescue banks� and are about to be faced with a welter of failings by the end of this summer
(10) And, last but not least, the banks, once they have squeezed money out of naive savers thanks to the market upsurge orchestrated in the past few weeks, will be have to admit that they are still insolvent by the end of summer 2009.
In the United States and United Kingdom in particular, the colossal public financial effort made in 2008 and at the beginning of 2009 for the sole benefit of large banks became so unpopular that it was impossible to consider injecting more public money into banks in spring 2009, despite the fact that they were still insolvent
(11) It then became necessary to invent a "fairy tale� to convince the average saver to inject his/her own money into the financial system. By means of the « green shoots » story, overpriced stock indices based on no real economic grounds and promises of « anticipated public funding repayment », the conditioning was achieved. Hence, while big investors from oil-producing and Asian countries
(12) withdrew capital from these banks, large numbers of small individual investors returned, full of hope. Once these small investors discover that public funding repayment is only a drop in the ocean of public aid granted to these banks (to help them dispose of their toxic assets) and that, after three or four months at best (as analyzed in this GEAB N°36), these banks are again on the verge of collapse, they will realize, powerless, that their share is worth nothing once again.
Intoxicated by financiers, world political leaders will be surprised - once again – to see all the problems of last year reappear, all the more severe since they were not addressed but only buried under piles of public money. Once that money has been squandered by insolvent banks compelled to rescue even more insolvent rivals, or by ill-conceived economic stimulus plans, problems will re-emerge, further exacerbated. For hundreds of millions of citizens in America, Europe, Asia and Africa, the summer 2009 will be a dramatic transition towards lasting impoverishment due to the loss of their jobs, with no hope of finding new ones in the next two, three or four years, or due to the disappearance of their savings invested in stocks or capital-based pension funds, or in banking investments linked to stock markets or denominated in US dollars or British pounds, or investment in shares of companies pressured to desperately wait for an improvement not coming soon.
Notes:
(1) Not even the « jobless recovery » many experts are trying to make us believe in. In the United States, United Kingdom, Eurozone and Japan, it is a « recoveryless recovery » we must expect, i.e. a pure invention aimed at convincing US and UK insolvent consumers to start buying again and keeping US T-Bonds' and UK Gilts' country purchasers waiting as long as possible (until they decide that there is really no future selling their products to the lands of the US Dollar and British Pound.
(2) Rogues waves are very large and sudden ocean surface waves which used to be considered as rare, though we now know that they appear in almost every storm above a certain strength. « Rogue waves » can reach heights of 30 meters (98 ft) and exert tremendous pressure. For instance, a normal 3 meter-high wave exerts a pressure of 6 tons/m². A 10 meter-high tempest wave exerts a pressure of 12 tons/m². A 30 meter-high rogue wave can exert pressure of up to 100 tons/m². No ship yet built is able to resist such pressures. One specific kind of rogue wave is called the "three sisters�, i.e. a group of three rogue waves all the more dangerous in that, even if a ship had time to react properly to the first two waves, there is no way she could be in the right position to brave the third one. According to LEAP/E2020, it is a similar phenomenon that the world is about to encounter this summer; and no country (ship) is in a favourable position to face them, even if some countries are more at risk than others, as explained in this GEAB (N°36).
(3) LEAP/E2020 estimate that their anticipations of social and economic trends in the various regions of the world - published in GEAB N°28 (10/16/2008) – are still relevant.
(4) More precisely, in every region, media and stock markets will no longer be able to hide the deterioration.
(5) Our readers have not failed to notice that the same people, media and institutions, considered everything was for the best in the best of worlds 3 years ago, that there was no risk of a severe crisis 2 years ago, and that the crisis was under control a year ago. Their opinion is therefore highly reliable!
(6) As regards US economic statistics, it will be interesting to follow the consequences of the revision of the indexing formula by the Bureau of Economic Analysis due to take place on 07/31/2009. Usually, this type of revision results in further complexity of historical comparisons and favourable modification of important figures. For example, some previous revisions enabled the division of the average level of measured inflation by three. Source: MWHodges, 04/2008.
(7) Except at a regional level where each political entity is organized the way that it wants. For instance, the EU is taking advantage of the political fading away of the UK - mired in a financial, economic and political crisis - and taking supervisory control of the City of London (source: Telegraph, 06/11/2009). It is likely that summer 2009 will be the end of 300 years of the City's supremacy at the centre of British power. On this subject, it is instructive to read George Monbiot's article in The Guardian dated 06/08/2009 and take the time to read John Lanchester's brilliant essay published in the London Review of Books dated 05/28/2009 entitled It's finished.
(8) Who cares any more about G8 final statements, such as that following the June 13th G8-Finance meeting (source: Forbes, 06/13/2009), at a time when each player in fact plays by his own rules: Americans on one side, Canadians and Europeans on another, British and Japanese in the middle, while the Russians play a complete different game?
(9) US Treasury's Secretary of State, Timothy Geithner, recently suffered a very embarrassing experience whilst giving a speech in front of Beijing University students: his audience simply burst into laughter when he reassured that the Chinese government had made the right choice investing their holdings in US T-Bonds and Dollars (source: Examiner/Reuters, 6/02/2009)! There is nothing worse than arousing irony or ridicule when you are an established power because that power is nothing without respect (on the part of both friends and enemies), especially when the one mocking is supposed to be "trapped� by the one mocked. According to LEAP/E2020, this laughter is worth a thousand explanations of the fact that China does not feel at all trapped by the US dollar and the Chinese authorities know exactly what tracks greenbacks and T–Bonds are following. This kind of situation was unthinkable only 12 months, maybe even 6 months ago, first because the Chinese were still naive, second because they thought it was in their interest to make everyone believe they were naive. Obviously, on the eve of summer 2009, this situation has vanished: no need to pretend anymore, as highlighted by this survey of 23 famous Chinese economists, published on the first day of Timothy Geithner's visit to Beijing, and revealing that most of them deem US assets risky (source: Xinhuanet, 05/31/2009). This student burst of laughter will continue to echo for many months to come...
(10) Not only in the US will shareholders be systematically prejudiced by the state under the pretext of higher common interest, as in the case of pension fund and bondholder losses related to the Chrysler and GM bankruptcies, or when the US government and Federal Reserve pressured Bank of America to hide the calamitous state of Merrill Lynch from its shareholders at the time of the latter's takeover. Sources: OpenSalon, 06/10/2009 / WallStreetJournal, 04/23/2009. In the UK, Europe and Asia, the same causes will produce the same effects: the raison d'etat has always been the simplest excuse to justify large-scale plundering ... and severe crises are perfect times to call in the raison d'etat.
(11) Germany has a similar problem due to next September's national election. After the election, the country's banking problems will be in the headlines, as several hundreds of billions of risky assets on the balance sheets of a number of banks, mainly regional ones, will need dealing with. It is far from the scope of US and UK banking problems, nevertheless Berlin will probably be faced with a number of potential bank failures. Source: AFP/Google, 04/25/2009. In the United States, the banks bailed out by the federal state have simply lowered the amount of loans granted when they are supposed to do the contrary. Source: CNNMoney, 06/15/2009
(12) Sources: Financial Times, 06/01/2009; YahooFinance, 06/04/2009; StreetInsider+Holdings/4656921.html, 05/15/2009; Financial Times, 06/01/2009
