World News joined 0012

[JohnCenaFan28]

Interesting, thanks for the read.

[JohnCenaFan28]

That's just wrong:hmm:

[JohnCenaFan28]

The global financial crisis is set to get worse, with a large US bank likely to collapse in the next few months, a former IMF chief economist has warned.



Kenneth Rogoff's comments came as shares in Fannie Mae and Freddie Mac sank on a report that the home lenders would, in effect, be nationalised.

Despite hopes that the US economy had turned the corner, Mr Rogoff claimed it was "not out of the woods".

"I would even go further to say 'the worst is to come'," he said.

"We're not just going to see mid-sized banks go under in the next few months," said Mr Rogoff, who held the IMF role between 2001 and 2004.

"We're going to see a whopper, we're going to see a big one, one of the big investment banks or big banks."

Speaking at a conference in Singapore, Mr Rogoff, now an economics professor at Harvard, forecast that Fannie Mae and Freddie Mac would "probably" not exist in their present form in a few years.

"We have to see more consolidation in the financial sector before this is over."

On Monday, shares of Fannie Mae fell more than 22%, or $1.76, to close at $6.15. Shares of Freddie Mac fell almost 25%, or $1.46, to $4.39.

'Wrong move'

Shares in Freddie and Fannie first fell sharply last month on fears that they would run out of money to fund their business, forcing the US government to take radical steps to ease the panic.

The two firms are the backbone of the US mortgage market as almost all US lenders rely on them to buy their mortgages in order to access the funds to lend to consumers.

As mortgage guarantors, they must pay out when homeowners default on their loans.

With the housing market across the US crumbling, their finances have come under severe stress.

Problems in the US housing sector prompted the Federal Reserve to slash interest rates to 2% earlier this year.

But Mr Rogoff said the Fed was wrong to cut interest rates as "dramatically" as it did.

"Cutting interest rates is going to lead to a lot of inflation in the next few years in the United States," he added.

BBC News

[JohnCenaFan28]

Zambia's leader Levy Mwanawasa, 59, has died in a Paris hospital after suffering a stroke in June.

Vice-President Rupiah Banda, who is expected to take over as acting leader, made the announcement on state TV.

President Mwanawasa suffered a stroke at an African Union summit in Egypt and was then flown to France, where he had remained in hospital.

He came to prominence recently for being one of the African leaders most critical of the violence in Zimbabwe.

Mr Mwanawasa's health was an issue during his presidency.

In April 2006, he suffered a minor stroke four months before general elections.

Donor praise

"Fellow countrymen, with deep sorrow and grief, I would like to inform the people of Zambia that our President Dr Levy Patrick Mwanawasa died this morning at 1030 hours [0830 GMT]," Reuters news agency quotes Mr Banda as saying.

"I also wish to inform the nation that national mourning starts today and will be for seven days."

On Monday, Mr Banda said that the president's health had suddenly deteriorated and he had undergone emergency surgery.

Mr Mwanawasa was chairman of the South African Development Community (Sadc) when he was taken ill in June.

In that role he had been critical of the controversial election in Zimbabwe and had said he sympathised with Zimbabwean opposition leader Morgan Tsvangirai when he withdrew from the run-off because of attacks on his supporters.

Mr Mwanawasa won a second term in 2006, having campaigned on his economic record which won him acclaim from Western donors.

When he was vice-president in the 1990s he was involved in a near-fatal road accident which left him with slurred speech.

Mr Mwanawasa famously fell out with his predecessor, Frederick Chiluba, who had handpicked him to lead the ruling Movement for Multiparty Democracy.

He pressed for Mr Chiluba's immunity from prosecution to be lifted and the former president was charged with stealing money during his time in office.

His critics accused Mr Mwanawasa of persecuting his political rivals under the guise of fighting corruption.

He was married and had six children. He had been a practising lawyer since 1973.

In his most famous case, he defended former Vice-President Lt-Gen Christon Tembo and others, who were charged in 1989 with plotting to overthrow Kenneth Kaunda.

BBC News

[JohnCenaFan28]

The number of homes and apartments being built in the US sank in July to the lowest level in more than 17 years, government figures show.



Builders started work on 965,000 properties, on an annualised basis, from 1.08 million in June, the Commerce Department said.

However, this was not as bleak as some had been expecting.

Separately, inflationary pressures saw US wholesale prices shoot ahead by 1.2% in July - its fastest pace in 27 years.

Core inflation, which strips out energy and food costs, climbed by 0.7% from June, the Labor Department said, well above the the 0.2% rise which had been forecast.

The rapid wholesale inflation seen in July was largely linked to energy costs during the month, which saw crude oil hit a record price of $147.27 per barrel, sending petrol prices soaring.

But there are hopes that prices rises will abate, now that the price of oil has fallen by more than $30 per barrel.

"Though commodity prices have come down significantly from record highs in mid-July and the dollar has strengthened, consumers can still expect to see increased inflation for some time to come as the producer price pressures feed through to consumer prices," said Arek Ohanissian, an economist at the CEBR.

Grim

Economists have been studying forward-looking information for signs that the US housing slump was past its worst.

However, the Commerce Department data made for grim reading, with the number of construction permits issued - seen as a reliable sign of future activity - down 17.7% on an annual basis.

And the number of new homes being constructed last month was down by 39.2% compared with July 2007.

"The continued weakening of the housing market is an additional pressure and households will feel further squeezed in terms of real disposable income," said Mr Ohanissian.

He said that "given this state of affairs and the general weakness of the economy" the Federal Reserve was likely to keep interest rates low at 2% - despite rising inflation.

BBC News

[OMEN]

Medical personnel help an injured passenger who survived Wednesday's crash
At least 45 people are dead and 19 seriously injured after a Canary Islands-bound airplane swerved off a runway and crashed Wednesday during takeoff at Madrid's international airport, the Spanish Interior Ministry said.
Media reports indicated the death toll could quickly climb, with Reuters citing an emergency services source as saying all but 25 people aboard the plane had died. Spanair's website said that 164 passengers and nine crew were aboard when the plane crashed around 2:45 p.m. local time.

Officials said the Spanair flight JK 5022 was bound for the popular holiday destination of Las Palmas, located on Grand Canary island off the northwestern coast of Africa.

TV footage showed a large plume of smoke rising from the site of the accident at the Madrid Barajas International Airport, located about 13 kilometres northeast of central Madrid.

El Pais editor Guy Hedgecoe told CBC News that emergency services were seen pulling passengers out of the burning plane while helicopters overhead poured water over it to try to douse the flames.
Hedgecoe said the plane was starting to leave the landing strip on takeoff when an engine on the left-hand side caught fire.

"We don't know the reason for the fire, but that seems to have caused the accident," he said.

Shortly after the fire began, the plane then descended onto the airstrip, crashed and burst into flames, he said.

The plane ended up in a wooded area at the end of a runway at the recently built Terminal 4, located on the edge of the airport grounds.

Passengers originating in Germany could also be aboard the flight since it shares a Lufthansa flight code, LH 2554.

Madrid's Barajas airport is Spain's busiest air hub, handling more than 40 million passengers a year.

CBC

[Black Widow]

A 16-year-old boy who plunged to his death from a block of flats was trying to escape a gang of masked youths.

Police said Ahmed Benyermak climbed down the outside of the building to get away from the group.

Officers discovered the teenager after being called to Hackney, in east London, at 3.45pm yesterday.

He was pronounced dead at the scene in Paragon Road.

Witnesses said he may have feared he was about to be attacked with a knife by the hooded gang on bikes.

Scotland Yard said he managed to get down six floors on the outside of the tower block before losing his footing and falling to his death.

A post-mortem examination was due to be held at Poplar Mortuary this morning.

No arrests have been made, but police have set up an incident room under the command of Detective Chief Inspector Ian Stevenson.

Anyone with information is asked to call Crimestoppers on 0800 555 111.


sky news

[JohnCenaFan28]

Thanks for the read.

[JohnCenaFan28]

Sad news, thanks for sharing it.

[JohnCenaFan28]

Russia has told Nato it is halting all military co-operation, the bloc says, as the crisis over Georgia deepens.



The Russian move follows a statement by Nato that there would be no "business as usual" with Moscow unless its troops pulled out of Georgia.

However, the alliance had stopped short of freezing co-operation with Moscow.

Meanwhile, a top Russian general said that the withdrawal of the bulk of Russia's troops would be complete in about 10 days.

Gen Vladimir Boldyrev, commander of the Russian ground forces in the region, referred to the pullout of troops "sent to reinforce Russian peacekeepers" in Georgia's breakaway region of South Ossetia.

It was not immediately clear how Gen Boldyrev's comments would fit in with a previous Russian commitment to withdraw its forces to behind a buffer zone around South Ossetia by the end of Friday.

Moscow has said it intends to keep some 500 troops in what it called a "zone of responsibility" as part of a peacekeeping mission.

In a separate development, South Ossetia and Abkhazia - another Georgia's breakaway region - held mass rallies calling for independence.

Russian Foreign Minister Sergei Lavrov said Moscow's response to their pleas would depend on the conduct of Georgian President Mikhail Saakashvili.

Lavrov's warning

Nato spokeswoman Carmen Romero said the alliance "takes note" of Russia's decision to halt co-operation but had no further reaction to it.

Speaking to reporters in the Russian Black Sea resort of Sochi, Mr Lavrov said Russia was not going "shut any doors" to future co-operation with Nato.

But he warned that the alliance had to decide what was more important to it - supporting Georgian President Mikhail Saakashvili or developing a partnership with Russia.

Latest footage of Russian troops near Igoeti in Georgia.

"It all depends not on us but on those who make the decisions on what the priorities are for the leaders of Nato in foreign policy," Mr Lavrov said.

Washington played down the significance of the Russian move, saying Nato had already effectively frozen co-operation in protests at Moscow's continuing military presence in Georgia.

"For all practical purposes, military-to-military co-operation had really already ended with the Russians," US National Security Council spokesman Gordon Johndroe said.

Under the 2002 agreement that set up the Nato-Russia Council, the former adversaries began several co-operation projects.

These included allowing Nato to transport by land through Russia non-military supplies for the bloc's operation in Afghanistan, developing battlefield anti-missile technology, joint military exercises and help with rescue at sea.

Security zone

It is still not clear to what extent Russian military forces have withdrawn from Georgia.

Russian news agencies say an armoured column, consisting of more than 40 vehicles, has passed through South Ossetia, on its way to the Russian border.

A BBC correspondent in the Georgian village of Igoeti, just 35km (21 miles) from the capital Tbilisi, said he saw the Russian military pulling back towards South Ossetia early on Thursday afternoon. Russian forces were also reported to be still dug in around Georgia's main Black Sea port of Poti.

Russia poured troops into Georgia after Georgian forces tried to retake South Ossetia on 7 August. Russian-led peacekeeping troops had been deployed there since a war in the early 1990s.

Thousands of people attended pro-independence rallies in the Abkhaz capital Sukhumi and war-ravaged South Ossetian capital Tskhinvali on Thursday.

The world-renowned conductor Valery Gergiyev - himself an Ossetian - gave a concert in the devastated South Ossetian capital of Tskhinvali, with his St Petersburg orchestra on Thursday.

BBC News