http://freeinternetpress.com Free Internet Press :: Uncensored News For Real People Newspaper en-us Copyright (c)2008, FreeInternetPress.com editor@freeinternetpress.com 60 http://freeinternetpress.com/freeinternetpress_sm.gif http://freeinternetpress.com 140 20 http://freeinternetpress.com/story.php?sid=18655 The global financial panic and the economic slowdown have put at least a temporary end to the commodity bull market of the last seven years, sending prices tumbling for many of the raw ingredients of the world economy. Since the spring and early summer, when prices for many commodities peaked amid fears of permanent shortage, wheat and corn - two cereals at the base of the human food chain - have dropped more than 40 percent. Oil has dropped 44 percent. Metals like aluminum, copper and nickel have declined by a third or more. The swift turnaround is the brightest economic news on the horizon for consumers, putting money into their pockets at a time they need it badly. Gasoline prices in the United States are falling precipitously - by about 24 cents over the last five days, to a national average of $3.21 a gallon on Monday - and analysts said they could go below $3 a gallon nationally this fall, down from a high of $4.11 a gallon in July. Prices for most commodities remain elevated by past standards, and they rose a bit on Monday amid the broad market rally. The trend seems to be downward as traders weigh the prospect that the global economic crisis will lead to sharp drops in demand. The big question is whether prices will drop all the way to long-term norms or whether Asia’s continuing economic boom has set a floor. The rapid commodity decline has eased fears of inflation, a reason central banks were able to lower interest rates around the world last week in an effort to salvage economic growth. It also represents a fundamental shift of view that is driving markets these days. http://freeinternetpress.com/story.php?sid=18655 http://freeinternetpress.com/story.php?sid=18654 U.S. Backs Mitsubishi's $9 Billion Stake In Morgan Stanley U.S. officials paved the way Monday for a private $9 billion investment into Morgan Stanley by Japan's largest financial firm by promising to protect its stake in the struggling Wall Street bank in the event of a government bailout. Mitsubishi UFJ Financial is throwing a lifeline to Morgan Stanley in exchange for 21 percent of the company. The deal bolsters the capital position of the Wall Street firm, whose shares had declined sharply over the past few weeks as some traders bet it would collapse. Monday, Morgan Stanley's shares jumped 87 percent, or $8.42, to close at $18.10. Mitsubishi had said last month it would make an investment in Morgan Stanley, but questions emerged about whether the deal would go through after Morgan Stanley's shares plunged and the Japanese stock market tanked. The new deal is more generous to Mitsubishi, offering the Japanese bank preferred stock paying a 10 percent dividend rather than a mix of common and preferred shares. Mitsubishi also was concerned about a U.S. government plan to take equity stakes in banks, perhaps wiping out existing shareholders. Treasury officials assuaged those concerns over the weekend, pledging that if the government did make investments in banks, Mitsubishi wouldn't see its investment disappear, according to a person familiar with the conversations. A Morgan Stanley official said company executives believed throughout the process that the bank doesn't need a capital injection from the government. http://freeinternetpress.com/story.php?sid=18654 http://freeinternetpress.com/story.php?sid=18653 Intellpuke: This editorial appeared in the New York Times edition for Monday, October 13, 2008. Call it bailout, take two. With credit markets frozen and the financial system teetering on collapse, Treasury Secretary Henry Paulson has decided to invest $250 billion directly in the nation’s banks in exchange for an ownership stake. It is a bold move for a desperate time. But Mr. Paulson still has to do more to ensure that American taxpayers, whose money he is investing, get the best deal. The hope is that new capital - along with a government guarantee for new bank debt issued over the next three years - will get the banks lending freely again. The approach - an about-face from Mr. Paulson’s earlier plan to buy up the banks’ bad assets - is more in line with European efforts. Coordination is essential to manage what has clearly become a global financial crisis. By taking an equity stake, taxpayers could have a better chance of seeing an eventual return on their investment. If the banks do turn around, then the government, as a shareholder, reaps the benefits. But we are disturbed that Mr. Paulson wants the government to be a passive investor with little say on how these banks are run, despite the billions of dollars at risk. That means the banks’ current boards and current management - the same people who got the country into this mess - will still be making all of the decisions. http://freeinternetpress.com/story.php?sid=18653 http://freeinternetpress.com/story.php?sid=18652 Iraq opened bidding Monday on the first round of contracts to develop its oil fields since the fall of Saddam Hussein,  a move intended to jump-start a sector crucial to the country's rebuilding. Iraq has the world's third-largest oil reserves. Yet, despite five years of efforts and $2.7 billion in U.S. reconstruction funds, Iraqi production is still well below the frequently cited U.S. goal of 3 million barrels per day. Oil fields have been looted and attacked by insurgents since the 2003 U.S.-led invasion, technical experts have fled abroad because of violence and the infrastructure is creaky after years of international sanctions and neglect. Iraq needs billions of dollars of investment to increase production, experts say. "Current production is by no means meeting demand for the reconstruction of the country," Iraq's oil minister, Hussein al-Shahristani, told reporters after meeting Monday in London with representatives of three dozen international oil companies. "International companies are needed to fast-track development. The response was fairly encouraging." Vera de Ladoucette, director of Middle East research for Cambridge Energy Research Associates, noted that the first round of bidding involves fields representing a third of known Iraqi oil reserves. http://freeinternetpress.com/story.php?sid=18652 http://freeinternetpress.com/story.php?sid=18651 The Florida congressman who succeeded Mark Foley after he resigned because of a sex scandal is now embroiled in a sex scandal of his own, and has requested a Congressional ethics investigation to clear his name. The congressman, Tim Mahoney, a Democrat, agreed to a $121,000 settlement with a former mistress who worked on his staff and was threatening to sue him, said two Democratic staff members who have been briefed on the settlement. The revelation, first reported by ABC News, could cost Mahoney his House seat. His South Florida district is conservative, and he was already in one of the most competitive races involving an incumbent Democrat. Mahoney was elected two years ago after the resignation of Representative Foley, a Republican, whose lewd Internet messages to Congressional pages created a national outrage. Without denying the accusations or explaining how he might benefit from an ethics investigation, Mahoney said the truth would vindicate him. http://freeinternetpress.com/story.php?sid=18651 http://freeinternetpress.com/story.php?sid=18650 With time running out for the conclusion of an agreement governing American forces in Iraq, nervous negotiators have begun examining alternatives that would allow U.S. troops to stay beyond the Dec. 31 deadline, according to U.S. and Iraqi officials. Neither side finds the options attractive. One possibility is an extension of the United Nations mandate that expires at the end of the year. That would require a Security Council vote that both governments believe could be complicated by Russia or others opposed to the U.S.-led war. Another alternative would amount to a simple handshake agreement between Iraqi Prime Minister Nouri al-Maliki and President Bush to leave things as they are until a new deal, under a new U.S. administration, can be negotiated. Negotiators have been stuck for months on the question of legal jurisdiction over U.S. troops and immunity for possible crimes. Even if the sides reach a deal in the next few days or weeks, it is not clear that a formal status-of-forces agreement could be approved by the end of the year. Maliki has pledged to submit an accord to Iraq's divided parliament before he signs it - a promise he reaffirmed last week during a visit to Grand Ayatollah Ali Sistani, Iraq's most influential Shiite cleric. Sistani has said he will not endorse any document without the support of Iraq's population and political factions. If the parliament refuses, Maliki would have "no choice" but to request a U.N. extension "because the American forces will lose their legal cover on Dec. 31," he told the Times of London in a weekend interview. "If that happens, according to international law, Iraqi law and American law, the U.S. forces will be confined to their bases and have to withdraw from Iraq," said Maliki. U.S. officials do not dispute that the absence of an agreement would probably require an immediate end to combat operations and, at a minimum, confinement to bases on Jan. 1. Officials refused to discuss the sensitive issue on the record while negotiations are ongoing. http://freeinternetpress.com/story.php?sid=18650 http://freeinternetpress.com/story.php?sid=18649 Intellpuke: This commentary was written by Washington Post Business Columnist Steven Pearlstein. It appeared in the Post edition for Tuesday, October 14, 2008. Mr. Pearlstein's commentary follows. The country has done for Wall Street. What is Wall Street willing to do for the country? Now, what was that about Hank Paulson having blown it? How he foolishly let Lehman Brothers go under and started a chain reaction that quickly turned into a financial meltdown? How he was so focused on his cockamamie plan to buy up distressed mortgages and mortgage-backed securities, instead of injecting capital into banks in exchange for shares? How he and the other finance ministers were so way behind the curve this past weekend in failing to come up with a detailed and coordinated plan to restore confidence in financial markets? The truth is we were going to have a serious financial crisis no matter what Paulson did or didn't do, thanks to the incredible ineptitude of Wall Street and the nation's financial regulators over the past few years, whether an insolvent and mismanaged investment bank was rescued or not. Lehman was the veritable straw that finally broke the back of the financial camel overloaded with debt. If it hadn't been Lehman, it would have been something else. http://freeinternetpress.com/story.php?sid=18649 http://freeinternetpress.com/story.php?sid=18648 The economic free fall gripping the U.S. may bring down one of the main environmental objectives: capping the greenhouse gases that are blamed for global warming. Democratic leaders in the House and the Senate, and both presidential candidates, continue to rank tackling global warming as a chief goal next year, but the focus on stabilizing the economy probably will make it more difficult to pass a law to reduce carbon dioxide and other greenhouse gases. At the very least, it will push back when the reductions would have to start. As one Republican senator put it, the green bubble has burst. "Clearly it is somewhere down the totem pole given the economic realities we are facing," said Tom Williams, a spokesman for Duke Energy Corp., an electricity producer that has supported federal mandates on greenhouse gases. Duke is a member of the U.S. Climate Action Partnership, an association of businesses and nonprofit groups that has lobbied Congress to act. Just months ago, chances for legislation passing in the next Congress and becoming law looked promising. The presidential candidates support mandatory cuts and a Democratic majority is ready to act on the problem after years of the Bush administration's resisting federal controls. http://freeinternetpress.com/story.php?sid=18648 http://freeinternetpress.com/story.php?sid=18647 Intellpuke: This commentary was written by Prof. George Monbiot and appeared in the Guardian edition for Tuesday, October 14, 2008. The financial crisis at least affords us an opportunity to now rethink our catastrophic ecological trajectory. This is nothing. Well, nothing by comparison to what's coming. The financial crisis for which we must now pay so heavily prefigures the real collapse, when humanity bumps against its ecological limits. As we goggle at the fluttering financial figures, a different set of numbers passes us by. On Friday, Pavan Sukhdev, the Deutsche Bank economist leading a European study on ecosystems, reported that we are losing natural capital worth between $2 trillion and $5 trillion every year as a result of deforestation alone. The losses incurred so far by the financial sector amount to between $1 trillion and $1.5 trillion. Sukhdev arrived at his figure by estimating the value of the services - such as locking up carbon and providing fresh water - that forests perform, and calculating the cost of either replacing them or living without them. The credit crunch is petty when compared to the nature crunch. The two crises have the same cause. In both cases, those who exploit the resource have demanded impossible rates of return and invoked debts that can never be repaid. In both cases we denied the likely consequences. I used to believe that collective denial was peculiar to climate change. Now I know that it's the first response to every impending dislocation. [British Prime Minister] Gordon Brown, for instance, was as much in denial about financial realities as any toxic debt trader. In June last year, during his Mansion House speech, he boasted that 40% of the world's foreign equities are now traded here. The financial sector's success had come about, he said, partly because the government had taken "a risk-based regulatory approach". In the same hall three years before, he pledged that "in budget after budget I want us to do even more to encourage the risk takers". Can anyone, surveying this mess, now doubt the value of the precautionary principle? http://freeinternetpress.com/story.php?sid=18647 http://freeinternetpress.com/story.php?sid=18646 Intellpuke: This commentary was written by Christopher Glazek and appeared in Spiegel's column "The World From Berlin" on Monday, October 13, 2008. Following Sunday's emergency meeting of European leaders in Paris, Germany announced a 500 billion euro financial sector rescue plan. German commentators are split in their response to the latest move. European leaders met for an emergency summit in Paris on Sunday to discuss a coordinated approach for addressing the financial crisis in the euro zone countries where Europe's common currency is used. At the summit, convened by French President Nicolas Sarkozy, European leaders pledged to broadly pursue a bailout policy based on the direct infusion of capital into ailing banks. In accordance with the principles agreed upon at the emergency summit, German Chancellor Angela Merkel on Monday unveiled plans for a €500 billion ($679 billion) rescue fund to help shore up the German banking system. Markets rallied on the news, with the German DAX posting strong gains in trading after the market opening and rising by 8.01 percent by Monday afternoon. This is the first time European leaders have come together to articulate a shared strategy for dealing with the crisis. German commentators have responded to the emergency summit with a mixture of praise and criticism. Some laud European governments for finally coming up with a coordinated response, warning that state intervention may be the only way to stop the crisis, while others argue that though inevitable, the move is tantamount to admitting failure. http://freeinternetpress.com/story.php?sid=18646 http://freeinternetpress.com/story.php?sid=18645 Republican vice presidential candidate Sarah Palin mistook some of her own fans for hecklers Monday at a rally that drew thousands. A massive crowd of at least 20,000 spread across the parking lot of Richmond International Raceway, and scores of people on the outer periphery more than 100 yards from the stage could not hear. "Louder! Louder!" they began chanting, and the cry spread across the crowd to Palin's left. Some pointed skyward, urging that the volume be increased. Palin stopped her remarks briefly and looked toward the commotion. "I hope those protesters have the courage and honor to give veterans thanks for their right to protest," she said. Some in the crowd tried to shout toward her what was really being said, but she couldn't hear them. http://freeinternetpress.com/story.php?sid=18645 http://freeinternetpress.com/story.php?sid=18644 Wall Street, taking note of U.S. and world regulators' efforts to combat the financial crisis, rebounded today from last week's debacle with a massive rally that propelled the Dow Jones industrial average to its largest daily point gain ever and the largest percentage increase since the depths of the Depression. After posting their worst week in history, the Dow Jones industrial average and the Standard & Poor's 500-stock index both posted big gains today. The Dow closed up 11 percent, or 936 points. It was the Dow's largest single-day point gain, far surpassing the jump of 499 points on March 16, 2000. Only four other days - all during the late 1920s and early 1030s - have seen larger percentage gains for the Dow. The S&P was up 11.6 percent, or 104 points, in its best one-day gain since 1939. The tech-heavy Nasdaq was up 11.8 percent, or 195 points. Stocks snapped an eight-day losing streak fueled by deepening concerns of a global recession. The Dow and S&P both lost 18 percent of their value last week, the worst week in Wall Street history. http://freeinternetpress.com/story.php?sid=18644 http://freeinternetpress.com/story.php?sid=18643 Determined to keep the campaign spotlight on the economy, Sen. Barack Obama added $60 billion in new tax breaks and other benefits to his economic stimulus plan, and urged Congress to act quickly after the election to provide middle-class relief. While his opponent, Sen. John McCain, has reportedly considered but not yet spelled out additional economic recovery steps, the Democratic nominee outlined several costly new proposals at a speech here this afternoon. They include: -- A temporary tax credit for firms that create jobs in the U.S. -- Penalty-free 401(k) and IRA withdrawals through 2009, to allow families to withdraw up to 15 percent of their savings, up to $10,000. -- A 90-day foreclosure moratorium for homeowners making "good-faith efforts" to keep up with their mortgage payments. -- Creating a new entity to lend to state and local governments, allowing for an effort similar to the liquidity assistance that the Federal Reserve recently extended to commercial banks. -- The temporary elimination of taxes on unemployment insurance benefits. http://freeinternetpress.com/story.php?sid=18643 http://freeinternetpress.com/story.php?sid=18642 With just over three weeks until Election Day, the two presidential nominees appear to be on opposite trajectories, with Sen. Barack Obama gaining momentum and Sen. John McCain stalled or losing ground on a range of issues and personal traits, according to a new Washington Post-ABC News poll. Overall, Obama is leading 53 percent to 43 percent among likely voters, and for the first time in the general-election campaign, voters gave the Democrat a clear edge on tax policy and providing strong leadership. McCain has made little headway in his attempts to convince voters that Obama is too "risky" or too "liberal." Rather, recent strategic shifts may have hurt the Republican nominee, who now has higher negative ratings than his rival and is seen as mostly attacking his opponent rather than addressing the issues that voters care about. Even McCain's supporters are now less enthusiastic about his candidacy, returning to levels not seen since before the Republican National Convention. Conversely, Obama's pitch to the middle class on taxes is beginning to sink in; nearly as many said they think their taxes would go up under a McCain administration as under an Obama presidency, and more see their burdens easing with the Democrat in the White House. The poll was conducted after Tuesday night's debate, which most voters said did not sway their opinions much. Still, voters' impressions of Obama are up, and views of McCain have slipped. http://freeinternetpress.com/story.php?sid=18642 http://freeinternetpress.com/story.php?sid=18641 Intellpuke: This commentary was written by Robert F. Kennedy, Jr., and appeared in the Huffington Post online edition for Thursday, October 9, 2008.  In 2004, America's malleable mainstream media allowed itself to be manipulated by artful Republican operatives into devoting weeks of broadcast attention and drums of ink to unfairly desecrating John Kerry's genuine Vietnam heroics while obligingly muzzling serious discussion of George W. Bush's shameful wartime record of evasion and cowardice. Last week found the American media once again boarding Republican swift boats against this season's Democratic candidate armed with unfair and hypocritical attacks artfully designed by GOP strategists to distract attention from the cataclysmic outcomes of Republican governance. Vice Presidential hopeful Sarah Palin has taken to faulting Senator Barack Obama for his casual acquaintance with a respected Illinois educator Bill Ayers, who forty years ago was a member of the Weathermen, a movement active when Obama was eight and which he has denounced as "detestable." Palin argues that the relationship proves that Obama sees "America as being so imperfect that he is palling around with terrorists who would target their own country." The Times dedicated a page one article to Obama's relations with Ayers and CNN's Anderson Cooper obliged Palin by rewarding her reckless accusations about Obama's patriotism with a major investigative report. Fox, meanwhile, is still riveting its audience with wall to wall coverage of this pressing irrelevancy. If McCarthy-era guilt-by-association is once again a valid political consideration, Palin, it would seem, has more to lose than Obama. Palin, it could be argued, following her own logic, thinks so little of America's perfection that she continues to "pal around" with a man - her husband, actually - who only recently terminated his seven-year membership in the Alaskan Independence Party. Putting plunder above patriotism, the members of this treasonous cabal aim to break our country into pieces and walk away with Alaska's rich federal oil fields and one-fifth of America's land base - an area three-fourths the size of the Civil War Confederacy. AIP's charter commits the party "to the ultimate independence of Alaska," from the United States which it refers to as "the colonial bureaucracy in Washington." It proclaims Alaska's 1959 induction as a state "as illegal and in violation of the United Nations charter and international law." http://freeinternetpress.com/story.php?sid=18641 http://freeinternetpress.com/story.php?sid=18640 Stock prices surged Monday morning amid hope that aggressive new steps by central banks around the world would prop up the global banking system and thaw out troubled credit markets. After suffering the worst weekly loss in its 112-year history last week, the Dow Jones industrial average leaped more than 500 points on the expectation that the U.S. government will follow some of its European counterparts in taking direct equity stakes in battered financial institutions. As of 9:20 a.m. PDT, the Dow was up 545.75 points, or 6.46%, at 8,996.94. The Dow and other major indexes were up more than 6%. The market has been overdue for a rebound after brutal two weeks, including eight consecutive losing days that dragged the Dow down almost 2,400 points. http://freeinternetpress.com/story.php?sid=18640 http://freeinternetpress.com/story.php?sid=18639 The family of Solomon Digal was summoned by neighbors to what serves as a public square in front of the village tea shop. They were ordered to get on their knees and bow before the portrait of a Hindu preacher. They were told to turn over their Bibles, hymnals and the two brightly colored calendar images of Christ that hung on their wall. Then, Digal, 45, a Christian since childhood, was forced to watch his Hindu neighbors set the items on fire. “ ‘Embrace Hinduism, and your house will not be demolished’,” Digal recalled being told on that Wednesday afternoon in September. “ ‘Otherwise, you will be killed, or you will be thrown out of the village’.” India, the world’s most populous democracy and officially a secular nation, is today haunted by a stark assault on one of its fundamental freedoms. Here in eastern Orissa State, riven by six weeks of religious clashes, Christian families like the Digals say they are being forced to abandon their faith in exchange for their safety. The forced conversions come amid widening attacks on Christians here and in at least five other states across the country, as India prepares for national elections next spring. http://freeinternetpress.com/story.php?sid=18639 http://freeinternetpress.com/story.php?sid=18638 After a weekend of crisis talks on both sides of the Atlantic, European nations and the United States unveiled on Monday a staggering and coordinated series of multibillion-dollar rescue packages to shore up teetering banks and guarantee credit to free up lending between them. While the broad outlines of some of the deals represented a concerted response to plummeting stock markets and frozen credit markets, the leading European economies also embraced some individual steps, underlining the differences of approach they have sought to bury in the face of the worst financial crisis of the post-war era. On Sunday, European leaders agreed to act at a national level from what officials called a “toolbox” of measures fitting their individual requirements. “The time of everyone moving alone is over,” French President Nicolas Sarkozy told a news conference in Paris. The sweeping measures began early Monday as Britain pledged to spend billions in taxpayer money to shore up battered banks. The British treasury said the initial steps could be worth $64 billion to three banks. In effect, the moves mean the partial nationalization of those institutions - the Royal Bank of Scotland, HBOS and Lloyds TSB. http://freeinternetpress.com/story.php?sid=18638 http://freeinternetpress.com/story.php?sid=18637 The stock market here has swooned so often in recent weeks that regulators have repeatedly shut it down, as if Russia, which aspires to be a financial powerhouse, has become just another bumbling backwater. The oligarchs, those Kremlin-connected magnates who once dazzled the world with their riches, are reeling. Vladimir V. Putin is facing a threat to his legacy of bringing growth, stability and a renewed swagger to this nation. The global financial crisis has not spared Russia, wiping out roughly a trillion dollars in wealth and forcing the government to adopt a broad rescue plan to shore up banks. At stake is the country’s robust economy over much of the last decade, which has for the first time given many Russians a taste of comforts long enjoyed in the West. For now, the damage has been largely limited to the Russian elite. While Russia’s stock market has plummeted by about two-thirds since May, more than those in the United States and Western Europe, the country has not yet developed a broad investor class, and most people have not squirreled away their savings in the market. As a result, though the stock market here had soared to $1.5 trillion in value, making it one of the world’s biggest, it had a very narrow base of investors. It was dominated by foreign and Russian investment funds, which sprinted for the exit when things started turning bad. The Kremlin has also sought to contain the fallout from the crisis by having the major Russian television networks, which it controls, play down or even ignore the stock market collapse here. The network news programs have instead focused on financial troubles in the United States and Europe. http://freeinternetpress.com/story.php?sid=18637 http://freeinternetpress.com/story.php?sid=18636 A document written by the Czech Communist police claims that author Milan Kundera informed on a purported Western spy in the 1950s, a state-sponsored institute said Monday. Kundera quickly denied the claims. The Institute for the Study of Totalitarian Regimes said a team of historians and researchers found a document written by the SNB, or Czech Communist police, that identified Kundera as the person who informed on a man who was later imprisoned for 14 years. The usually reclusive Kundera, author of ''The Unbearable Lightness of Being,'' rushed to reject the charge. ''I am totally astonished by something that I did not expect, about which I knew nothing only yesterday, and that did not happen. I did not know the man at all,'' Kundera was quoted as saying by the CTK news agency. Kundera accused the institute and the media of ''the assassination of an author.'' http://freeinternetpress.com/story.php?sid=18636 http://freeinternetpress.com/story.php?sid=18635 The embattled investment bank Morgan Stanley announced Monday morning that it had closed its deal to sell a 21 percent stake to a large Japanese bank, securing a $9 billion lifeline. The deal had fallen into question last week as Morgan Stanley’s stock lost about 59 percent of its value. It completion was considered a crucial step in the federal government’s strategy for revitalizing the financial system by luring outside investment while it considers buying stock in banks directly. Mitsubishi UFJ, the world’s second-largest bank, invested $9 billion in Morgan Stanley as planned, but the Japanese bank demanded better terms. The two banks spent the weekend in negotiations to come up with a plan that could be announced before the markets opened on Monday morning. The hope is that Mitsubishi’s backing will stem the tide of doubt about Morgan Stanley’s future. The original terms said that Mitsubishi would purchase $3 billion in common stock and $6 billion in convertible preferred stock. In the new deal, all of the investment is in preferred stock. Though the total investment remains the same, the Japanese bank is paying lower prices per share - $25.25 instead of $31.25. Morgan Stanley will pay Mitsubishi a 10 percent dividend on the entire investment instead of paying a dividend on only part of the investment, as previously planned. A portion of the Japanese investment is now in nonconvertible preferred stock, a departure from the previous plan to issue common equity and convertible preferred stock. Morgan Stanley shares were up 74 percent on Monday, to $16.93. http://freeinternetpress.com/story.php?sid=18635 http://freeinternetpress.com/story.php?sid=18634 Paul Krugman, a professor at Princeton University and an Op-Ed page columnist for the New York Times, was awarded the Nobel Memorial Prize in Economic Sciences on Monday. “It’s been an extremely weird day, but weird in a positive way,” Krugman said in an interview on his way to a Washington, D.C., meeting for the Group of 30, an international body from the public and private sectors that discusses international economics. He said he was mostly “preoccupied with the hassles” of trying to make all his scheduled meetings on Monday and answer a constantly ringing cellphone. Krugman received the award for his work on international trade and economic geography. In particular, the prize committee lauded his work for “having shown the effects of economies of scale on trade patterns and on the location of economic activity.” He has developed models that explain observed patterns of trade between countries, as well as what goods are produced where and why. Traditional trade theory assumes that countries are different and will exchange different kinds of goods; Krugman’s theories have explained why worldwide trade is dominated by a few countries that are similar to each other, and why some countries might import the same kinds of goods that it exports. http://freeinternetpress.com/story.php?sid=18634 http://freeinternetpress.com/story.php?sid=18633 They huddled in a quiet corner at the U.S. Airways lounge at Ronald Reagan National Airport, sipping bottomless cups of coffee as they plotted to turn America’s missile defense program into a personal cash machine. Michael Cantrell, an engineer at the Army Space and Missile Defense Command headquarters in Huntsville, Alabama, along with his deputy, Doug Ennis, had lined up millions of dollars from Congress for defense companies. Now, Cantrell decided, it was time to take a cut. “The contractors are making a killing,” Cantrell recalled thinking at the meeting, in 2000. “The lobbyists are getting their fees, and the contractors and lobbyists are writing out campaign checks to the politicians. Everybody is making money here - except us.” Within months, Cantrell began getting personal checks from contractors and later returned to the airport with Ennis to pick up a briefcase stuffed with $75,000. The two men eventually collected more than $1.6 million in kickbacks, through 2007, prompting them to plead guilty this year to corruption charges. Cantrell readily acknowledges concocting the crime, but what has drawn little scrutiny are his activities leading up to it. Thanks to important allies in Congress, he extracted nearly $350 million for projects the Pentagon did not want, wasting taxpayer money on what would become dead-end ventures. Recent scandals involving former Representative Randy Cunningham, Republican of California, and the lobbyist Jack Abramoff, both now in prison, provided a glimpse into how special interests manipulate the federal government. Cantrell’s story, by contrast, pieced together from federal documents and dozens of interviews, is a remarkable account of how a little-known, mid-level Defense Department insider who spent his entire career in Alabama skillfully gamed the system. http://freeinternetpress.com/story.php?sid=18633 http://freeinternetpress.com/story.php?sid=18632 For months, Mark Wagner stuck by John McCain, even as the economy stalled and other Americans came to blame Republican leadership. Then, about three weeks ago, the deepening economic downturn pushed him to reconsider. Now, the Florida salesman and staunch Republican has abandoned the Republican ticket. Sarah Palin, he thinks, looks under-equipped to be vice president. And McCain, he says, displayed an unsteady response to what may be a global economic depression. The financial crisis has turned the last three weeks into a crucial and possibly decisive period in the presidential contest - a time when many Americans have taken a new look at each candidate and then moved toward Democrat Barack Obama. Like a wave, the crisis has washed over other factors in a contest that had seemed to be a dead heat, moving enough voters to give the senator from Illinois a consistent lead in polls nationwide and in key battleground states, including Florida, Virginia and Ohio, where President Bush secured his reelection four years ago. Republican officials in several states say they fear voters have judged McCain and Palin harshly in how they reacted to the financial downturn. Obama, meanwhile, now looks like an acceptable alternative to many voters who had been hesitant to pull the lever for him because of concerns about his untraditional background and relatively recent appearance in national affairs. "If you looked at some of the decisions that Obama's made, and the consistency and levelness that he's had in these trying times over the past few weeks, in my opinion he's blown McCain away," said Wagner, 47, of suburban Tampa. http://freeinternetpress.com/story.php?sid=18632 http://freeinternetpress.com/story.php?sid=18631 Convinced that key evidence was being withheld from the defense, Lt. Col. Darrel J. Vandeveld went from being a "true believer to someone who felt truly deceived" by the tribunals. Darrel J. Vandeveld was in despair. The hard-nosed lieutenant colonel in the Army Reserve, a self-described conformist praised by his superiors for his bravery in Iraq, had lost faith in the Guantanamo Bay war crimes tribunals in which he was a prosecutor. His work was top secret, making it impossible to talk to family or friends. So the devout Catholic - working away from home - contacted a priest online. Even if he had no doubt about the guilt of the accused, he wrote in an August e-mail, "I am beginning to have grave misgivings about what I am doing, and what we are doing as a country. . . . "I no longer want to participate in the system, but I lack the courage to quit. I am married, with children, and not only will they suffer, I'll lose a lot of friends." http://freeinternetpress.com/story.php?sid=18631 http://freeinternetpress.com/story.php?sid=18630 Officials from 20 major countries Saturday endorsed a coordinated approach to the financial crisis, but they failed to announce any concrete steps, underscoring the difficulty of crafting a global plan to halt the contagion as it spread to the broader economy. The announcement, made in Washington, D.C., by finance ministers from major developed countries as well as emerging giants such as China and Brazil, echoed a broad set of principles outlined Friday by the world's richest nations. But critics have described such responses as too bland and vague to calm panicked investors following the record rout on stock markets last week. Advocates for a coordinated global response say that the scope of the financial crisis requires enormous resources and that a piecemeal approach by individual countries leaves the global system exposed to weaknesses. Lack of faith in any one country's response could spark investor unease, and that unease could quickly spread across borders. "You need specific, concrete steps, not a list of principles that are obvious and everyone can easily agree to," said Simon Johnson, former chief economist at the International Monetary Fund and a senior fellow at the Washington, D.C.-based Peterson Institute for International Economics. "It's not what the markets are looking for before trading starts in Asia." http://freeinternetpress.com/story.php?sid=18630 http://freeinternetpress.com/story.php?sid=18629 The Bush Administration's plans to take stakes in financial institutions could backfire, some analysts say. Proponents say it's an efficient solution. Are we witnessing the erosion of capitalism, or its salvation? That question is swirling around the federal government's latest proposed intervention in the private financial markets since Treasury Secretary Henry M. Paulson announced Friday a plan to take equity stakes in banks as a quick and efficient way to pump them with new capital. Combined with the government's takeover last month of the mortgage companies Fannie Mae and Freddie Mac and its huge ownership stake in the crippled insurance company American International Group, the bank plan represents perhaps the largest federal intervention in private enterprise since President Truman's attempt to nationalize the steel industry to avert a strike in 1952 - a move blocked by the Supreme Court. The idea of taking direct stakes in financial institutions was adopted last week by Britain, which will in effect partly nationalize banks with as much as $87 billion in capital infusions and an additional $350 billion available for short-term loans. Some of the country's biggest banks have signed up, including Barclays and the Royal Bank of Scotland. The Italian government has also authorized a recapitalization package to be enacted if the need arises. Germany, with Europe's biggest economy, has resisted such plans, but there were reports Saturday that Chancellor Angela Merkel might unveil a recapitalization plan as early as Sunday. http://freeinternetpress.com/story.php?sid=18629 http://freeinternetpress.com/story.php?sid=18628 The "first gentleman" also read official correspondence and went to closed cabinet meetings, records and an investigation indicate. Barely two weeks after Sarah Palin had been sworn in as Alaska's governor, in December 2006, then-Public Safety Commissioner Walt Monegan's executive secretary got a confusing phone call from Palin's office: The first gentleman would like to schedule a meeting with her boss. "I was not familiar with the term 'first gentleman,' or didn't hear her correctly, so I kept asking her, 'Who?' " the secretary, Cassandra Byrne, testified recently. "And she eventually said, 'Todd Palin.' " The appointment was fixed, and Monegan arrived in the governor's office to find himself alone with the brawny, popular fisherman and snowmobile champion, who was sitting at a 12-foot-long conference table, surrounded by stacks of documents. One of the documents had the logo and letterhead of Monegan's own Department of Public Safety. http://freeinternetpress.com/story.php?sid=18628 http://freeinternetpress.com/story.php?sid=18627 The Iraqi government on Sunday ordered security forces to increase protection of Christians in northern Iraq, where hundreds have fled their homes in recent days after a wave of killings and threats. At least a dozen Christians have been slain in the past few weeks in the city of Mosul, which has remained violent even as attacks have dropped in other parts of the country. Fighters from al-Qaeda in Iraq, a mostly homegrown extremist group, have resisted efforts by U.S. troops to oust them from the area. "These attacks have never been seen in Mosul city. Centuries and centuries we were living together," a parliamentary deputy, Yonadam Kanna, said in an interview before he and other Christian politicians met Sunday with Prime Minister Nouri al-Maliki. Maliki's office said in a statement that he was ordering the Iraqi army and police in the Mosul area "to provide protection for members of this (Christian) community" and added that the security forces would "target the terrorist groups" behind the attacks. Christians make up about 3 percent of Iraq's 27 million people, down from roughly twice that percentage before the 2003 U.S.-led invasion, according to church leaders and human-rights organizations. http://freeinternetpress.com/story.php?sid=18627 http://freeinternetpress.com/story.php?sid=18626 The Bush administration Saturday removed North Korea from its list of state sponsors of terrorism after Pyongyang agreed to allow inspectors access to declared nuclear sites, in a deal that drew quick criticism from conservatives. After weeks of rancorous negotiations, North Korea agreed to resume the disabling of its Yongbyon plutonium plant and permit international inspectors to return. Although U.S. officials hailed the deal as an important accomplishment, the agreement left unresolved what happens if inspectors seek access to suspicious sites that the regime has not declared. Though they demanded access to other areas, U.S. officials settled for language saying that entry to undeclared sites would be granted based on "mutual consent."The ambiguities of the deal concerned some Republicans, including presidential nominee Sen. John McCain, who said he still needed to be convinced that the deal was a good one. http://freeinternetpress.com/story.php?sid=18626