Monday, September 12, 2011
German Finance Minister Prepares for Possible Greek Bankruptcy
German Finance Minister Wolfgang Schäuble, who is reportedly doubtful that the country can be saved from bankruptcy, is preparing for the possibility of Greek insolvency. Officials in his ministry are currently reviewing scenarios for handling such a situation, exploring what it might mean for the rest of the euro zone. Under the first scenario for a Greek bankruptcy, the country would remain in the euro zone. Under the other, Athens would abandon the common currency and reintroduce the drachma.
Bankruptcy Could Create Credit Crunch
One of these key instruments would be credit lines provided to countries like Spain or Italy if investors stop lending them money after a Greek bankruptcy. If banks were forced to write off the billions in Greek government bonds on their books, they could become reliant on billions in rescue fund aid in numerous euro-zone countries. Both developments are to be expected in a Greek insolvency, regardless of whether the country exits the euro or not.
Volker Bouffier, the governor of the state of Hesse, which is home to Germany's financial capital Frankfurt, is a member of Chancellor Angela Merkel's conservative Christian Democratic Union (CDU) party, as is Schäuble. Bouffier is now urging that the possibility for countries to leave the euro zone be created quickly. Current European Union treaties provide no provisions for a country to abandon the currency.
"If the savings and reform efforts of the Greek government aren't successful, then we need to ask the question of whether we need new rules to make it possible for a euro country to leave the currency union," Bouffier told SPIEGEL.
Read the full story on Monday on SPIEGEL ONLINE International.
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Saturday, September 10, 2011
World Entering 'Dangerous New Phase': Lagarde
Christine Lagarde, the managing director of the International Monetary Fund, warned that the global economy is entering a "dangerous new phase" on Friday, ahead of the G7 summit in Marseilles, France.
French finance minister Christine Lagarde is seen as a front-runner to succeed Strauss-Kahn.
She warned that both advanced and emerging economies faced key economic challenges, and that governments must "act now" to stop further contagion.
"Policymakers should stand ready, as needed, to take more action to support the recovery, including through unconventional measures," Lagarde said.
"The world is collectively suffering from a crisis of confidence, in the face of a deteriorating economic outlook and rising concerns about the health of sovereigns and banks."
Her speech at Chatham House in London came after a turbulent week for the markets, with the focus on sovereign debt issues in the euro [EUR=X 1.3651
-0.023 (-1.66%) 
] zone and job creation in the US.She welcomed President Obama's new $450 billion jobs package, announced Thursday, but added "it remains critical for the United States to clarify its medium term plan."
The British government, including Chancellor of the Exchequer George Osborne, who also spoke, was warned that "risk levels are rising" in the UK and the government needs to have a "heightened readiness to respond."
However, Lagarde conceded that the government's response "remains appropriate."
When Lagarde called for the recapitalization of European banks at the Jackson Hole summit in the United States in August, a flight away from European banks resulted in the markets.
Osborne agreed that the situation is "more complex" than in 2008 but described his government's plan as a "rock of stability".
"The underlying cause is the same – excessive levels of debt," he said.
He backed Tim Geithner, the US Treasury Secretary, who wrote in the Financial Times on Friday that the three most important elements for boosting growth are: strengthening growth in the US, stronger actions in Europe to halt the debt crisis and emerging markets like China allowing their currencies to adjust to market forces.
One of the factors weighing down markets is the perception that the situation is worse than 2008, and that there are fewer policy options available to governments and central banks.
Osborne warned that "nothing would be more damaging" to the British economy than an increase in interest rates.
The Bank of England Thursday held its interest rate unchanged at 0.5 percent, a historic low, which has now been in place for two and a half years.
He also supported greater fiscal and institutional integration in the euro zone.
This stance is fast becoming popular, although there has not been any clear signal as to what greater integration would involve.
Stephen King, chief economist at HSBC, told CNBC.com after the speech on Friday that he believed a "fiscal club" would work for the euro zone.
"Countries that don't stick to the guidelines would have their memberships suspended, and if a country chooses not to sign up, it won't get the benefits other countries do and will be pushed to the edge of the euro zone," he said.
"It will not be a proper member of the euro zone."
"As time goes by, there's a danger of getting worse rather than better."
Friday's G7 meeting will include discussions on the risks facing the economy at the moment.
The changing landscape in the Middle East and North Africa following the Arab Spring, and how more advanced economies can help the countries which are transforming their governments, will also be on the agenda.
© 2011 CNBC.com
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Protest of Thousands in Cairo Turns Violent and attack Israel embasy
CAIRO — A demonstration that brought tens of thousands to this city’s central Tahrir Square turned violent on Friday, when thousands of people — led by a heavy contingent of soccer fans — tore down a protective wall around the Israeli Embassy, while others defaced the headquarters of the Egyptian Interior Ministry.
Egyptian protesters dismantled a concrete wall which was in front of the Israeli embassy in Cairo.
About 200 people were injured in clashes with the police at the Israeli Embassy and 31 were injured near the Interior Ministry, the Ministry of Health said late Friday night. Protesters scaled the walls of the Israeli Embassy to tear down its flag, broke into offices and tossed binders of documents into the streets.
Mustafa el Sayed, 28, said he had been among about 20 protesters who broke into the embassy. He showed a reporter video from a cellphone, of protesters rummaging through papers and ransacking an office, and he said they had briefly beaten up an Israeli employee they found inside, before Egyptian soldiers stopped them. The soldiers removed the protesters from the building, he said, but let them go free.
By 11:30 p.m., about 50 trucks had arrived with Egyptian riot police officers, who filled the surrounding streets with tear gas. Witnesses said that protesters had set a kiosk on fire in front of a security building near the embassy, and that the police had fired rubber bullets to disperse the crowd from both buildings. But at 3 a.m. Saturday, thousands of protesters were still battling thousands of riot police officers. Demonstrators threw rocks and gasoline bombs at the officers, sometimes forcing them to retreat, and the police fired back with tear gas. To celebrate an advance, protesters set off the flares that they typically use to cheer at soccer matches.
Egyptian airport officials said early Saturday that the Israeli ambassador was waiting for a military plane to leave the country, The Associated Press reported.
United States officials said Defense Minister Ehud Barak of Israel had called Defense Secretary Leon Panetta, who in turn asked the Egyptian military to try to restore order at the embassy.
In addition, a fire broke out in the basement of the Interior Ministry, but it appeared to have been started from the inside and not by the protesters surrounding the building. The fire was in a room believed to store criminal records.
The scale of the protests and the damage inflicted represented a departure from the previously peaceful character of the demonstrations staged periodically in Tahrir Square since the revolution in January and February.
Organizers of Friday’s demonstrations had said they would call for a list of familiar liberal goals, like retribution against former President Hosni Mubarak and an end to military trials of civilians. But thousands of people marched off from the square to express their anger over disparate recent events, including a recent dispute along the border with Israel and a brawl between soccer fans and the police at a match on Tuesday.
Thousands of hard-core soccer fans — known here as ultras — were for the first time a conspicuous presence in the protests and a dominant force in the violence. They led the attacks on the Interior Ministry and the security building near the Israeli Embassy, and they kept up the fight outside the embassy long after others had gone home. At the Interior Ministry, political activists tried to form human barriers to protect the building, urging protesters to retreat to the square and chanting, “Peacefully, peacefully.”
“Those who love Egypt should not destroy it!” they chanted.
The embassy, which has been the site of several previous demonstrations after the Israeli armed forces accidentally killed at least three Egyptian officers while chasing Palestinian militants near the border last month, was an early target on Friday. In response to almost daily protests since the shootings, the Egyptian authorities had built a concrete wall surrounding the embassy, and by early afternoon thousands of protesters, some equipped with hammers, were marching toward the building to try to tear down the wall.
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Friday, September 9, 2011
Denver Airport exposed
Here is where Obama its going to be on the feast of trumpets....when planet x passes between the earth and sun
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Palestinians launch bid for UN membership
Palestinian representatives began their campaign for statehood recognition with a march to United Nations headquarters in the West bank, ahead of a formal application to the UN on September 20. The US said it would veto the bid.
AFP - The Palestinians on Thursday launched a campaign in support of their UN membership bid despite US opposition, as their leaders met to reaffirm plans to become the world body's 194th member state.
Washington, however, confirmed it would veto any such bid and an EU source said European Union foreign policy chief Catherine Ashton was to travel to the Middle East next week for talks on the Palestinian push.
The so-called "National Campaign for Palestine: State 194" is part of the build-up to September 20, when president Mahmud Abbas is expected to submit a formal request the United Nations accept the state of Palestine as a member.
Abbas on Thursday met senior Palestinian representatives including the central committee of his Fatah party, the PLO's executive committee and leaders of various Palestinian political parties.
UN’S BAN KI-MOON GIVES CAUTIOUS SUPPORT
United Nations Secretary-General Ban Ki-moon reaffirmed his support for an independent Palestinian state on Friday but said Palestinian U.N. membership was an issue for member states to decide.
The PLO committee "affirms the need to continue at the next session of the UN, the process to obtain recognition of membership for a state of Palestine on the borders of June 4, 1967, with east Jerusalem as its capital," PLO secretary general Yasser Abed Rabbo said in a statement after the session.
"The Palestinian leadership believes that attaining this goal will encourage the relaunch of a serious peace process and new negotiations with the clear objective of a two-state solution on the 1967 borders," he said, referring to the lines that existed before the 1967 Six-Day War.
The leadership meetings came just 10 days before Abbas is expected to fly to New York where he will present a formal membership request to UN Secretary General Ban Ki-moon on September 20.
In Washington, State Department spokeswoman Victoria Nuland said Washington's opposition to such a move by the Palestinians rather than direct negotiations with Israel "should not come as a shock."
"So yes, if something comes to a vote in the UN Security Council, the US will veto," she said.
Meanwhile, the EU source in Brussels said that Ashton will leave early next week for Cairo to meet Arab League ministers and Abbas for talks on the bid, also opposed by Israel.
She will also travel to Israel as part of her efforts to ensure the Palestinian resolution "can get broader support," the source added, declining to be named.
If the bid is vetoed in the Security Council, the Palestinians plan to turn to the General Assembly where they are expected to easily win the votes needed to upgrade their representation from observer body to non-member state.
As the leaders met in Ramallah, the official Palestinian campaign of support for the bid got under way with around 100 people marching to UN headquarters in the West Bank town to hand in a letter to the UN representative asking that Ban support the membership application.
The letter, a copy of which was seen by AFP, said the campaign would continue "until the state of Palestine is finally admitted as member state number 194."
Chanting "We want a state," the marchers waved Palestinian flags and held up signs demanding that Palestine be admitted as the 194th state, also calling on Arab nations to support the bid.
The letter was given to Pascal Soto, head of the UN office in Ramallah, by Latifa Abu Hamid, a 60-year-old mother from Amari refugee camp near Ramallah, whose seven sons who have all spent time in Israeli prisons. Her eighth son was shot dead by Israeli troops.
"I'm delivering this message to the UN to say we have a right to our own state just like everyone else in the world and we have a right to see the end of the occupation," she said.
The letter urged Ban to "stand by justice and do right by our people."
"The admission of the state of Palestine to the UN is an important step towards ending the occupation and achieving Palestinian independence and realising a just and comprehensive peace in the Middle East," it reads.
"We hope that you will join the international consensus and support the Palestinian bid for its long-overdue recognition."
Soto said he would pass the letter on to the UN chief.
After submitting the UN request on September 20, Abbas is to address the General Assembly on September 23 in a speech officials say will be broadcast on giant screens in Palestinian cities.
Nuclear warheads could be next Stuxnet target
Due to the complexity and sophistication of the code contained within the Stuxnet worm, the possibility of it being used to take control of a nuclear warhead is high, according to a security expert.
At Check Point’s Sydney conference this week, Check Point Israel security evangelist, Tomer Teller, said he analysed the code of the Stuxnet worm, which was used to take control of a nuclear facility in Iran in June, 2009.
“This is a huge file, it’s 1 megabyte [MB] of code and I respect the skill required to engineer that code as it is very complex,” he said.
Teller confirmed the code in Stuxnet could be modified to launch new SCADA attacks. “Nuclear warheads are controlled by computers so if someone managed to slip a worm inside a facility that will reach the warhead component, they could launch it and than aim it back at the country’s facility,” he said.
“Stuxnet is the first cyber weapon that could cause major disruption."
While Teller is uncertain which country was behind the Iranian nuclear facility attack, he said a USB stick was the most likely method used to carry the worm inside the facility.
However, Teller also mentioned a rogue employee may have helped compromise the facility's internal security defences first to help the rapid spread of Stuxnet.
He explained that in order to insert certificates embedded with Stuxnet into a Windows 64-bit system, it had to be trusted by Microsoft.
“In order to get something trusted by Microsoft, you need to get those exploits signed,” Teller said.
“What we think happened is that an insider broke into JMicron, a chip manufacturing company based in Taiwan, as there is a computer at that office which is dedicated to signing these Microsoft drivers.”
According to Teller, Stuxnet is a blueprint for future SCADA attacks, and he is aware that people have downloaded and modified the worm.
"Stuxnet may have been deployed already but we don't know about it because some companies won't disclose breaches," he said.
CIO
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