Tuesday, October 25, 2011
Biometric registry slammed in light of personal info theft
Government Services Minister Michael Eitan (Likud) called for the immediate reevaluation and halt of the establishment of a biometric population registry and identity system following the announcement Monday that sensitive personal information of every Israeli citizen was stolen by a government contractor and put on the Internet.
"The state is building a time bomb that will explode in all of our faces," Eitan said of the biometric program that is set to begin a pilot program next month. "There is no disagreement that the biometric database is dangerous, but [they] are making false promises that the database will be hermetically sealed with unprecedented security."
He questioned whether it can be ensured that there will be no other disgruntled workers among those working with the biometric registry, who may distribute the public's finger prints and facial scans.
The biometric population registry, Eitan said, "will beleaked and broken into also, and it's only a matter of time. I hope that the lesson will now be learned and a complete reevaluation will take place in relation to the dangerous and useless biometric database."
The Association for Civil Rights (ACRI) in Israel praised the Justice Ministry for solving the five-year-old case of the theft of personal information from the Population Registry but warned that such information, if obtained by criminals or terrorists would cause irreversible damage.
The case of the stolen information from the Population Registry "is a warning to all Israeli residents: Don't give your finger prints to somebody who doesn't know how to guard much less sensitive personal information," head of privacy and information for ACRI, lawyer Avner Pinchuk said.
The Interior Ministry, Pinchuk added, "recently admitted that a leak of biometric information would cause 'irreparable damage to an individual citizen' but promises us that it knows how to protect the biometric registry." The pilot program for biometric identity cards is set to begin later this year.
Jerusalem Post
Vatican Calls for New World Economic Order
VATICAN CITY – The Vatican called Monday for radical reform of the world's financial systems, including the creation of a global political authority to manage the economy.
A proposal by the Pontifical Council for Justice and Peace calls for a new world economic order based on ethics and the "achievement of a universal common good." It follows Pope Benedict XVI's 2009 economic encyclical that denounced a profit-at-all-cost mentality as responsible for the global financial meltdown.
The proposal acknowledges, however, that a "long road still needs to be traveled before arriving at the creation of a public authority with universal jurisdiction" and suggests the reform process begin with the United Nations as a point of reference.
Vatican pronouncements on the economy are meant to guide world leaders as well as the global church. United States Roman Catholic bishops, for example, have released a voter guide for the 2012 election that highlights social concerns such as ending poverty.
"It is an exercise of responsibility not only toward the current but above all toward future generations, so that hope for a better future and confidence in human dignity and capacity for good may never be extinguished," the document said.
It highlights that reforms must assure that financial and monetary policies will not damage the weakest economies while also achieving fair distribution of the world's wealth.
The proposal also called for a "minimum, shared body of rules to manage the global financial market," lamenting the "overall abrogation of controls" on capital movements.
While past Vatican pronouncements have condemned unfettered capitalism, the latest criticized "an economic liberalism that spurns rules and controls."
It also attacked "utilitarian thinking," saying what is useful to the individual does not always favor the common good.
Read more: http://www.foxnews.com/world/2011/10/24/vatican-calls-for-new-world-economic-order/#ixzz1bo0WDj3v
Moody's Downgrades Russian Banking System
Addressing the credit conditions in the market for the next 10 to 18 months, the report suggested that the poor performance of the world economy coupled with the adverse effects of the sovereign debt crisis in Europe will cause a contraction in liquidity, slow credit growth and pressure on asset quality.
A negative outlook is one that is likely to be marked by "volatility and uncertain conditions," Moody's said. The "stable" label, which the sector had previously enjoyed, denotes an environment likely to generate sustainable profitability.
The survey of 111 financial institutions justified its prognosis for the banking sector through the identification key problem areas. It said Russian banks are exposed to contagion from global markets, that depositor confidence is low, asset quality is weak, poor corporate governance is endemic and that there are regulatory deficiencies.
"Global financial market volatility, reduced access to wholesale funding, continued capital flight and downward pressure on the ruble have already led to a liquidity squeeze in the Russian banking system," Moody's vice president and report author Yevgeny Tarzimanov said in written comments.
In September, the ruble lost 10 percent against the dollar, and Russia's stocks have seen significant falls in recent months in line with international trends.
Moody's said Russia's gross domestic product growth in 2012 would fall to 2.8 percent, from an estimated 3.8 percent this year. Prime MinisterVladimir Putinsaid last week that growth would be above 4 percent in 2011.
But the report said government support for Russian creditors was an important strength for the sector, and that the state had already begun assistance to maintain liquidity.
Many experts believe that the Russian banking system is in a much stronger position to weather a crisis today than it was in 2008.
"Bankers are much calmer. They have accumulated experience, [and] they are ready," Anatoly Aksakov, president of the association of regional banks said Friday.
But Richard Hainsworth, director of RusRating, an independent bank rating agency, told The Moscow Times that it was not a global economic downturn that would hurt Russia, but the decisions made by Russia.
Hainsworth said it was Russia's brief war with Georgia that really spooked investors in 2008, rather than global problems, and stressed that domestic decisions were also of paramount importance today.
"There is a problem in the world, but it will not affect Russia unless Russia catalyses the uncertainty," he said.
Read more:http://www.themoscowtimes.com/business/article/moodys-downgrades-russian-banking-system/446190.html#ixzz1bnzRRqZL
The Moscow Times
Don’t push us on Greek debts, banks warn
PARIS — Any deal forcing banks to take bigger losses on Greek debt “would be tantamount to default” and impose a high cost on European taxpayers, the lead negotiator for the banks warned on Monday.
Banks and other private sector holders of Greek government bonds have been holding talks with EU officials to revise a plan agreed in July and take bigger losses on the debt, but Charles Dallara, managing director of the Institute of International Finance (IIF), warned against pushing too hard.
“There are limits … to what could be considered as voluntary to the investor base and to broader market participants,” said Mr. Dallara.
“Any approach that is not based on cooperative discussions and involves unilateral actions would be tantamount to default, would isolate the Greek economy from international capital markets for many years, and would impose a harsh burden on the Greek people as well as European taxpayers who have already done a lot to support Greece,” he said.
EU leaders on Sunday outlined plans to recapitalise and improve funding for European banks, but failed to resolve how big a loss the private sector takes on Greek bonds and how to make best use of the EFSF eurozone rescue fund. They are meeting again Wednesday with the goal of hammering out a final deal.
Banks have offered to stretch the voluntary loss on Greek debt to 40%, from July’s agreement to take a 21% loss, but politicians are demanding the private sector agree to writedowns of at least 50% , a senior German banker said. Banks fear that too big a “haircut” will set a dangerous precedent, particularly for Italian bonds.
The head of the French banking federation, Frederic Oudea, warned Monday that discounting the value of Greece’s sovereign debt held by private investors by more than 50% could cause contagion by denting investor confidence in Italian and other sovereign debts.
Meanwhile, in Berlin Monday German lawmakers flexed their muscles to secure a full parliamentary vote on Wednesday on eurozone crisis measures negotiated by Chancellor Angela Merkel and her eurozone peers, a move senior politicians said would give Ms. Merkel a stronger mandate.
The new vote comes just one month after Germany’s Bundestag (lower of house of parliament) approved greater powers for the eurozone rescue fund, and should pass without problems, but it risks delaying Europe’s response to the debt crisis at a crucial juncture.
Ms. Merkel cannot agree to changes to the 440 billion euro European Financial Stability Facility (EFSF) without approval at least from the Bundestag’s budget committee, as a result of a constitutional court decision last month.
However, Ms. Merkel’s Christian Democrats’ (CDU) floor leader Volker Kauder demanded a full debate and vote by the German Bundestag (lower house of parliament) rather than just a vote by the 41-member budget committee, which might have been quicker and less risky while still meeting new rules on consulting MPs.
Major opposition parties the Social Democrats (SPD) and the Greens welcomed the vote, and indicated they would back proposals aimed at countering the debt crisis. But they stopped short of confirming they would vote “yes,” saying they needed to see documents detailing the proposals first.
The Chancellor’s supporters praised her for getting France to drop demands to use the European Central Bank to leverage euro crisis funds, and there was broader support also for a leader often accused of dithering.
“Merkel’s Battle for our Euro,” was Monday’s headline in the mass-circulation conservative paper Bild, saying she taught France’s Nicolas Sarkozy “that the EFSF rescue fund cannot be used to print money” to solve the debt crisis.
Mr. Sarkozy ceded to German insistence at Sunday’s summit that the ECB should not be used to fight the crisis, which poses an especially big threat to French banks and France’s triple-A sovereign debt rating.
Instead, an EU paper obtained by Reuters suggested the eurozone would take up Germany’s proposal of boosting the EFSF’s firepower by using it as a form of debt insurance, combined with seeking help from emerging market economies like China and Brazil via a special purpose investment vehicle (SPIV) to prop up the euro zone’s secondary bond market.
Italian Prime Minister Silvio Berlusconi on Monday defended his government’s commitment to fiscal rigor after the European Union urged Italy to pass “comprehensive” measures to fight the debt crisis.
“We are meeting our public-debt obligations on time, we have a primary surplus stronger than our partners,’ we will reach a balanced budget in 2013,” Mr. Berlusconi said in an emailed statement. Mr. Berlusconi was put on the defensive at the Brussels summit over the nation’s finances and appointments at the European Central Bank. While Mr. Sarkozy said he had confidence in “Italian authorities as a whole” at a press conference yesterday in Brussels, he declined to answer a follow-up question on whether he had confidence in Mr. Berlusconi.
Reuters
US States Are Facing Total Debt of Over $4 Trillion
The total of U.S. state debt, including pension liabilities, could surpass $4 trillion, with California owing the most and Vermont owing the least, a new analysis says.
The nonprofit State Budget Solutions combined states' major debt and future liabilities, primarily for pensions and employee healthcare, unemployment insurance loans, outstanding bonds and projected fiscal 2011 budget gaps. It found that in total, states are in debt for $4.2 trillion.
The group, which follows state fiscal conditions and advocates for limited spending and taxes, said the deficit calculations that states make "do not offer a full picture of the states' liabilities and can rely on budget gimmicks and accounting games to hide the extent of the deficit."
The housing bust, financial crisis and economic recession caused states' tax revenue to plunge, and huge holes have emerged in their budgets over the last few years. Because all states except Vermont must end their fiscal years with balanced budgets, states have scrambled to cut spending, hike taxes, borrow and turn to the federal government for help.
Taxpayers are worried the states' poor fiscal health will persist for a long time and some Republicans in Congress have questioned whether the situation is worse than the states say.
State Budget Solutions relied on financial reports and income tax rates provided by the Federation of Tax Administrators in determining its rankings.
The true debt totals may be lower, though, because the group also used the highest estimates of pension gaps. The conservative think tank American Enterprise Institute says public pensions are short $2.8 trillion.
Others, including the nonpartisan research group Pew Center on the States, put total unfunded pension liabilities at around $700 billion.
The wide range is based on different assumptions of the returns of pension fund investments, which provide the bulk of money for benefit payments. Conservative economists say the investments will have annual returns of around 4 percent, while many funds expect returns in line with the average of the last 20 years — closer to 8 percent.
Using the higher pension gap number, State Budget Solutions said California is in the biggest financial hole — with total debt of more than $612 billion. New York follows with $305 billion of debt, and then Texas, with total debt of $283 billion. Vermont has the lowest amount of total debt at just over $6 billion.
The group also looked at the financial shape of states using the Pew pension projections. It came up with a total debt of $2 trillion for all states.
California still owes the most under the alternative computation, but the state's total debt drops significantly, to $307 billion. With the Pew numbers, New Jersey follows with $183 billion of debt and Illinois is next at $150 billion.
According to the analysis, California has also borrowed the most from the federal government to pay for unemployment benefits, $8.6 billion. Michigan was next, taking out $3.1 billion, and then New York, borrowing $2.9 billion.
As unemployment shot up, some states could not pay for the surge in demand for jobless benefits. The federal government loosened its lending rules to keep states from having to cut other areas of their budgets. But last month the U.S. government again began charging interest on the outstanding loans and may levy extra taxes on businesses in states with outstanding loans.
Looking at just state annual financial statements, the group found Connecticut has the highest debt per capita, at $5,402, and nine states have debt of more than $3,000 per capita.
CNBC
EU referendum: David Cameron hit by biggest Conservative rebellion
A total of 79 of his MPs voted for a Commons motion calling for a referendum on Britain’s relationship with the EU, even though Mr Cameron had ordered his party to oppose it. Two tellers indicated they supported the motion.
Another two Tories voted yes and no, the traditional way of registering an abstention. A further 12 did not vote.
In all, about half of all Conservatives outside the “payroll vote” of ministers and their aides scorned Mr Cameron’s authority. Rebel leaders warned that the Prime Minister faced a protracted “war” with his own party over the European issue.
The call for a referendum was defeated only because Labour and Liberal Democrat MPs also opposed it. The motion was rejected by 483 votes to 111 in the late-night Commons vote.
At least two junior members of the Government backed the referendum motion and resigned. They included Adam Holloway, an aide to David Lidington, the Europe Minister, who accused ministers of mistreating loyal Conservatives.
Previously, the biggest Conservative rebellion over Europe came in 1993 when 41 Tory MPs defied John Major over the Maastricht treaty. The revolt was also easily the biggest that Mr Cameron’s government has suffered on any issue.
Many Conservative MPs are unhappy about aspects of Mr Cameron’s Coalition deal with the Liberal Democrats, and the new mood of defiance raises the prospect of more challenges to the Prime Minister’s authority in future.
After the vote, David Nuttall, the Conservative MP who proposed the referendum motion, warned ministers that they had “won this particular battle but they certainly have not won the war.”
Ed Miliband, the Labour leader, described the vote as “a humiliation” for the Prime Minister. “If he can’t win the argument with his own backbenchers, how can the country have confidence that he can win the arguments that matter for Britain?” he said.
Sir George Young, the Leader of the House, denied that the Conservatives were split, saying: “It is not Maastricht.”
However, one of those Tories who backed the motion, Douglas Carswell, said it was the night Euroscepticism “went mainstream” in the Commons.
“Finally, people in the Westminster bubble are beginning to reflect the real concerns that people out there have about Europe,” he said.
A No10 spokesman said: “The House of Commons has clearly voted against this motion.
“We understand that many people who voted for it felt very strongly – and we respect that. However, the Government has to do what is in the national interest.
“The easy thing to do would have been for us to have avoided expressing a view. It was important to take a strong lead because Britain’s best interests are served by being in the EU.
Earlier, during more than six hours of debate, a string of Conservative MPs accused Mr Cameron of mishandling the EU referendum issue by imposing a three-line whip on the vote, the strongest possible order to back the Government.
The Telegraph
Japan's finance minister prepared to take action on yen
Japan is prepared to take action in the foreign exchange market to stem the rising yen currency, according to its finance minister.
The remarks by Jun Azumi succeeded in weakening the value of the yen against the US dollar in Monday trading.
The yen hit a record high against the dollar in New York on Friday.
Mr Azumi's comments came as Japan reported export growth of 2.4 percent in September compared to a year ago, according to the Ministry of Finance.
That follows a month of growth in overseas shipments during August.Record high
Japan's exports, hard hit by the earthquake and tsunami that struck in March, have been dented by the strength of the yen.
A strong yen makes Japanese products more expensive in overseas markets compared to Asian rivals such as China and South Korea.
Last week, the yen touched 75.78 against the US dollar, alarming Japan's companies and government officials.
"This is an utterly speculative move and not reflecting the economic fundamentals at all. This is regrettable," Mr Azumi said.
"If this move becomes excessive, we have to take decisive action. I already instructed my staff on Saturday to be prepared to take action."
His comments will be seen as a warning to currency speculators whose actions could be contributing towards the yen's rise.
Now, investors are waiting to see if the government will directly intervene in the currency markets again.
The last time officials intervened was in August, when they spent a record amount of money trying to weaken the yen.
BBC
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