Today's Coming Crisis Movie

Thursday, May 5, 2011

Ten reasons for thinking the world economy is turning soft and crisis lurks ahead

It’s all a bit worrying. Evidence of a sharp slowdown in both the European and world economies continues to mount. Earlier confidence that the global economy was strong enough to absorb moves by China and other emerging markets to tighten policy in the face of rising inflation are being increasingly questioned. Today alone, there’s been a whole clutch of indicators suggesting trouble on the way. Here’s a list of the top ten.

1. Jean-Claude Trichet, president of the European Central Bank, has put further rate rises on hold until at least July and dropped the phrase “strong vigilance” from the ECB’s news conference to explain the ECB’s policy decision.

2. Contrary to expectations as little as a month ago that the Bank of England would by now be taking the first tentative steps towards a policy tightening, the UK Monetary Policy Committee has again left rates on hold in the face of weak economic data. No-one now expects a rate rise until the Autumn at the earliest.

3. The Markit/CIPS headline services PMI index for the UK eased to 54.3 in April from 57.1, suggesting that the UK economy failed to pick up speed in April following its lack lustre performance in the first quarter.

4. German industrial orders fell unexpectedly in March, reflecting an unusually low number of large orders and suggesting that the country’s remarkable economic rebound may be past its peak.

5. World stock markets and the crude oil price took big hits on Thursday amid growing worries about the sustainability of the economic rebound.

6. The number of Americans filing for jobless aid rose to an eight month high last week. US productivity growth also slowed in the first quarter, backing up suggestions of a loss of momentum in US job creation. (read more)

What Europe's coming debt default will look like

I’m not sure why everyone thought comments the other day from the German Finance minister, Wolfgang Schäuble, to the effect that Greece may eventually face a sovereign debt restructuring, were such a revelation. This is in fact only a statement of the blindingly obvious, has been apparent in the market price of Greek sovereign debt for more than a year now, and was in any case implicit in the statement issued after the European Council meeting of March 24-25, when ministers said restructuring would be a pre-condition to borrowing from the European Stability Mechanism if debt was judged to be on an unsustainable path.

Even so, combined with the latest Moody’s downgrade on Friday of Irish sovereign debt, his comments have sparked a fresh round of jitters in markets, and led some commentators to think an act of default among the peripheral eurozone economies is imminent. I don’t doubt that certainly Greece, and possibly Ireland and Portugal will eventually have to restructure, but here’s why it’s not going to happen any time soon.

First and most important, none of these countries are yet willing to contemplate such a radical course of action. It’s possible that political developments in Europe could force such an outcome on them sooner rather than later; there is every chance, for instance, that Sunday’s election in Finland could produce a government hostile to any future bailouts, and therefore scupper the proposed Portugese rescue before it’s up and running. Things might quickly unravel if Finland refuses to take part in bailouts. (read more)

Portugal faces two years of recession and substantial economic and social upheaval

The €78bn (£69bn) bail-out package will push Portugal into recession for at least two years and cause substantial economic and social upheaval, the beleaguered country's finance minister has warned.

Teixeira dos Santos said that the financial conditions and budget constraints imposed by the European Union (EU) and the International Monetary Fund (IMF) in exchange for the rescue package are likely to cause Portugal's economy to contract by 2pc this year and a further 2pc in 2012.

Mr dos Santos, who is the caretaker finance minister, told a press conference on Thursday: "This program requires deep reforms and profound changes for our country."

He admitted that the package would require a painful overhaul of Portugal's public sector and a sell-off of state-owned stakes in key companies. Portuguese unemployment is expected to rise from 11pc to 13pc in 2013.

But he added that the process would help introduce vital structural reforms that would make Portugal stronger going forward.

In a joint statement regarding the bail-out, the EU and IMF said: "This programme's success will require a truly national effort." (read more)

Al Queda Threats Claim Nuclear Bombs Hidden All Over U.S. (as reported by CBS Chicago): Fraud or not, isn't it strange this occurred just a month ago?

The threats came in the mail and to date, there have been 25 letters that warn of nuclear bombs destroying America.

People who got them called the FBI and CBS 2′s Kristyn Hartman learned, the Bureau’s Chicago office is leading the investigation.

FBI Special Agent Andre Zavala said, “Yes, they alarmed a lot of people.”

Attorney Tracy Rizzo was alarmed. A number of days ago, an envelope, with a Chicago postmark and a hand-written address to her private investigations firm, came in the mail.

The letter inside said, “The Al-Qaeda organization has planted 160 nuclear bombs throughout the U.S. in schools, stadiums, churches, stores, financial institutions and government buildings.” It also said, “This is a suicide mission for us.”

The writer, who claims to be Osama Bin Laden, tells the reader the nukes are remotely controlled. “It was clear the writer wanted to scare me,” said Rizzo, “Yes, it frightened me.” Rizzo was one of eight people in the Chicago area to contact the FBI. (read more)

Bizarre Al Jazeera Censorship: Benazir Bhutto's Osama death comments deleted from Al Jazeera interview -- why?

This post was reader contributed.

US Treasury suggests $2 trillion debt cap raise: sources

The Treasury has told lawmakers a roughly $2 trillion rise in the legal limit on federal debt would be needed to ensure the government can keep borrowing through the 2012 presidential election, sources with knowledge of the discussions said.

Obama administration officials have repeatedly said that it is up to Congress to decide by how much the $14.3 trillion debt limit should be raised.

But when lawmakers asked how much of an increase would be needed to meet the government's obligations into early 2013, Treasury officials floated the $2 trillion working figure, Senate and administration sources told Reuters.

Former Treasury officials have said it is routine for Congress to ask the Treasury Department for guidance. Republican leaders have asked the White House to provide the size of any proposed increase before the two sides sit down on Thursday to discuss the debt limit face-to-face.

"We have not specified an amount or a time frame. We think that should be left up to Congress," Mary Miller, Treasury's assistant secretary for financial markets, told reporters on Wednesday.

She also said it would be better to raise the debt ceiling enough so that the government does not bump up against it so frequently. (read more)

Obama administration floats draft plan to tax cars by the mile

The Obama administration has floated a transportation authorization bill that would require the study and implementation of a plan to tax automobile drivers based on how many miles they drive.

The plan is a part of the administration's Transportation Opportunities Act, an undated draft of which was obtained this week by Transportation Weekly.

The White House, however, said the bill is only an early draft that was not formally circulated within the administration.

“This is not an administration proposal," White House spokeswoman Jennifer Psaki said. "This is not a bill supported by the administration. This was an early working draft proposal that was never formally circulated within the administration, does not taken into account the advice of the president’s senior advisers, economic team or Cabinet officials, and does not represent the views of the president.”

March Congressional Budget Office report that supported the idea of taxing drivers based on miles driven.

Among other things, CBO suggested that a vehicle miles traveled (VMT) tax could be tracked by installing electronic equipment on each car to determine how many miles were driven; payment could take place electronically at filling stations. (read more)

32% more millionaires by 2020: Canada -- and how many more impoverished or financially pressured?

A new study suggests that Canada's millionaire club is going to have a lot more members over the next decade.

The study, released by the Deloitte Center for Financial Services, predicts the number of Canada's millionaires will surge to more than 2.5 million by 2020 — up by more than 32 per cent from the current 1.7 million.

The study also says the assets of those millionaires will reach $6.77 trillion, up from $3.35 trillion today.

The surge in wealth is partly due to Canada's strong economy, particularly in the resource sector. During that time, Canada's GDP is forecast to grow by more than three per cent per year, while the inflation rate is expected to stay around 2.5 per cent. At the same time, the report expects Canada's population to grow by less than one per cent.

Globally, the report forecasts that the number of millionaires will double in the next decade across the world's 25 largest economies. In that time, their collective wealth is expected to soar to $202 trillion from $92 trillion. (read more)

A gold tsunami coming, according to Richard Russell

I do not always agree with 86-year old Richard Russell, author of the Dow Theory Letters, but there is no disputing that he has been on the money with his gold recommendations ever since the low of $250 ten years ago. He believes a final explosive phase the yellow metal is approaching – a viewpoint I concur with. The paragraphs below are an excerpt from a recent report.

“We’re moving nearer and nearer to the edge of the hurricane. I can feel it in my bones. Every newspaper now carries an ad for gold. The ironic clincher was this ad below that I clipped from a weekly newspaper.

“Is there a gold bubble? Are you kidding me? Here’s an ad that somebody paid for suggesting that people should turn in their gold (!!) for Federal Reserve Notes. They’re not telling you to buy gold during one of the greatest bull markets in history – hardly, they’re asking you to throw parties in which the object is to get ignorant people to SELL their gold. (read more)

Mexican Central Bank Quietly Buys 100 Tons of Gold -- Why?

Mexico has quietly purchased nearly 100 tons of gold bullion, as central banks embark on their biggest bullion buying spree in 40 years.

The purchase, reported in monthly data published by Mexico’s central bank, is the latest in a series of large gold buys by emerging market economies intent on diversifying reserves away from the faltering US dollar.

China, Russia and India have acquired large amounts of gold [GCCV1 1486.10 -29.20 (-1.93%) ] in recent years, while Thailand, Sri Lanka and Bolivia have made smaller purchases.

Central banks became net buyers of gold last year after two decades of heavy selling – a reversal that has helped propel the price of bullion to a series of record highs.

On Wednesday gold was trading at about $1,510 a troy ounce, down 4 percent from a nominal record high of $1,575.79 reached on Monday.

As a result of Mexico’s purchase, central banks, sovereign wealth funds and other so-called “official sector” buyers are on track to record their largest collective purchase of gold since the collapse of the Bretton Woods system, which pegged the value of the dollar to gold, in 1971.

GFMS, a precious metals consultancy, had predicted that the official sector would make net gold purchases of 240 tons this year, compared with a post-Bretton Woods peak of 276 tons in 1981. (read more)

World Food Prices Rise to Near-Record High as Inflation Speeds Up, UN Says

World food prices rose to near a record in April as grain costs advanced, adding pressure to inflation that is accelerating from Beijing to Brasilia and spurring central banks to raise interest rates.

An index of 55 commodities rose to 232.1 points from 231 points in March, the United Nations’ Rome-based Food and Agriculture Organization said in a report on its website today. The gauge climbed to an all-time high of 237.2 in February before dropping 2.6 percent in March.

The cost of living in the U.S. rose at its fastest pace since December 2009 in the 12 months ended in March, the same month in which Chinese consumer prices rose by the most since 2008. The European Central Bank raised interest rates on April 7, joining China, India, Poland and Sweden in a bid to control inflation partly blamed on food costs. Costlier food also contributed to riots across northern Africa and the Middle East that toppled leaders in Egypt and Tunisia this year. (read more)

2 Pennsylvania School Districts Weigh 4-Day Weeks as budget cuts force teacher layoffs across US

Two Pennsylvania school districts are considering switching to a four-day week to save money.

The Coatesville Area School District in Chester County and the Warren County School District are considering four-day weeks for the entire school year as a way to prevent layoffs and program cuts. No other Pennsylvania districts have such a schedule.

Under the Coatesville plan, students in the middle and high schools would have their days extended 45 minutes. Elementary school students would get an extra 80 minutes. Coatesville superintendent Richard Como says the change would save his district $1.7 million per year.

Warren County school officials say such a move would save money by cutting the number of meals the district must serve and trimming transportation costs. (Source)

Report: Nearly Half Of Detroiters Can’t Read, which surprisingly actually boosts the national average (just kidding... or are we?)

According to a new report, 47 percent of Detroiters are ”functionally illiterate.” The alarming new statistics were released by the Detroit Regional Workforce Fund on Wednesday.

WWJ Newsradio 950 spoke with the Fund’s Director, Karen Tyler-Ruiz, who explained exactly what this means.

“Not able to fill out basic forms, for getting a job — those types of basic everyday (things). Reading a prescription; what’s on the bottle, how many you should take… just your basic everyday tasks,” she said.

“I don’t really know how they get by, but they do. Are they getting by well? Well, that’s another question,” Tyler-Ruiz said.

Some of the Detroit suburbs also have high numbers of functionally illiterate: 34 percent in Pontiac and 24 percent in Southfield.

“For other major urban areas, we are a little bit on the high side… We compare, slightly higher, to Washington D.C.’s urban population, in certain ZIP codes in Washington D.C. and in Cleveland,” she said.

Tyler-Ruiz said only 10 percent of those who can’t read have gotten any help to resolve it. (read more)

Obama At Ground Zero Amid Raid Story Doubts - 5th May 2011

President Barack Obama is visiting New York's Ground Zero - as fresh doubts emerge over the official US account of the raid that killed Osama bin Laden.

The American leader will hope to begin to bury the memory of the terror chief by honouring those who died in the September 11 attacks on the World Trade Centre.

He has been holding private talks with 9/11 families and first responders after laying a wreath at the 9/11 memorial.

But the visit comes as a senior US defence official revealed only one of the five people killed in the raid on bin Laden's compound was armed and fired a shot.

The official presented a very different account to the administration's original portrayal of a chaotic, intense and prolonged firefight.

He said the sole shooter in the al Qaeda leader's Pakistani compound was shot dead in the early minutes of the operation.

Details have become clearer now the Navy Seal commando assault team has been debriefed, the official said, speaking on condition of anonymity because he was not authorised to speak on the record.

He said the raid should be described as a precision, floor-by-floor operation to hunt and find the al Qaeda leader and his protectors.

As the Navy Seals moved into bin Laden's compound, they were fired on by bin Laden's courier, who was in the guesthouse, the official said.

The commandos returned fire, and the courier was killed, along with a woman with him. The official said she was hit in the crossfire.

The Americans were never fired on again as they encountered and killed a man on the first floor and then bin Laden's son on a staircase, before arriving at bin Laden's room. Read More

2011 is only four months old, yet this is already one of the deadliest years for US tornadoes on record. - Apr 2011

2011 is only four months old, yet this is already one of the deadliest years for US tornadoes on record. As Alabama and other states count the human cost of the twisters that ravaged the South last week, you can use the graphic below to compare preliminary tornado reports from 2011 with historical patterns.

In 2011, there may be multiple reports for some tornadoes spotted at different points along their tracks. For previous years, the points in the graphic plot the start of confirmed tornado tracks, and are sized according to the number of deaths caused. Roll over the points to see more information about each tornado, use the slider to scroll through the years, and the tab to view death tolls since 1950.

Nuclear Event - Radioactive Water Pumped Into Mississippi River - 3rd May 2011

The Nuclear Regulatory Commission is investigating a radioactive release into the Mississippi River from the Grand Gulf Nuclear Plant in Port Gibson.

Fact or Fiction - Ancient Aliens "Unexplained Structures" - 5th Apr 2011

There are suggestions that various sites around the world; such as Göbekli Tepe in Turkey; the Incan ruins of Sacsayhuamán in Peru; the Carnac stones of France; and Zorats Karer in Armenia, show construction techniques and mathematical concepts that were not believed to have been known at the time, and that this knowledge was gained from alien visitors.

Osama bin Laden: Hillary Clinton 'no idea' what they were Watching - 5th May 2011

Hillary Clinton has said she has "no idea" what she and the rest of Barack Obama's national security team were watching at the precise moment a photographer snapped what has become the defining image of the Osama bin Laden operation.

Mrs Clinton said the raid was "38 of the most intense minutes" in her life, but her expression and the fact that her hand is covering her mouth might not convey any special significance

The US secretary of state, who suffers from allergies, says she was embarrassed that her hand gesture may have only been her trying to stifle a cough or sneeze.

The secretary spoke at a press conference with Italian Foreign Minister Franco Frattini ahead of a diplomatic meeting on Libya.

Mrs Clinton added that the battle against al-Qaeda continues despite bin Laden's death.

"Let us not forget that the battle to stop al-Qaeda and its affiliates does not end with one death. We have to renew our resolve," Mrs Clinton said. Source

Tel Aviv takeoffs halted over contaminated fuel, most outgoing flights suspended -- cause unknown

Israel halted most departures from Tel Aviv's Ben-Gurion international airport on Thursday after routine checks found aviation fuel supplies were contaminated, an airport spokesman said.

Only aircraft that flew in with sufficient fuel to reach their next destination were being allowed to depart as scheduled. The spokesman said the cause of the contamination was not immediately known. (Source)

Jia Ashton Mystery - Police arrest man, 22, on suspicion of murdering 'Yellow Brick Road' victim Jia Ashton - 5th May 2011

Police probing the murder of Thorntons worker Jia Ashton arrested a 22-year-old man today.

The 25-year-old was found dead in woodland near Somercotes, Derbyshire, in March.

A spokesman for Derbyshire Police said detectives investigating the death of Miss Ashton arrested the suspect at a flat in the nearby Amber Valley area this afternoon.

Mrs Ashton, who lived in Somercotes, Derbyshire, and worked for chocolate-maker Thorntons in nearby Swanwick, disappeared on March 10 and was found dead in nearby woods three days later.

The victim left the Thorntons site shortly after 5pm on Thursday, March 10 and is known to have walked into Sleetmoor Woods, along a path known locally as the 'yellow brick road'.

Her body was found in the woods at 4.30pm on Sunday, March 13 and a £20,000 reward was subsequently offered by an anonymous benefactor for information to catch her killer.

Police believe it was on the path that she met her killer.

Her husband Matthew, 26, was arrested three days after she went missing and held for 48 hours but was later released without charge.

Earlier this month police revealed forensic tests conducted on evidence at the murder scene produced a forensic profile of the killer.

In the days following the killing it emerged that Mr Ashton had spent the night his wife was killed in a Travelodge nearby.

It was claimed he had checked in after leaving work that evening because the couple had been rowing.

But Mr Ashton, who also works from home as a private piano teacher, told his local newspaper that his wife was an 'incredibly happy person' and that the couple 'didn't argue about anything bigger than who was going to mow the lawn or get off the sofa to fetch something'.

He added that they had been discussing starting a family and going travelling and said he would remain at the home they had lovingly renovated because 'it was our first home together and I've got tremendous memories'.

The couple married while still at university in 2006, in Miss Ashton's home province in China.

Mr Ashton said he feared he may never discover why she was murdered. Read More

Pakistan warns America not to stage any more raids

Pakistan warned America Thursday of "disastrous consequences" if it carries out any more unauthorized raids against suspected terrorists like the one that killed Osama bin Laden.

However, the government in Islamabad stopped short of labeling Monday's helicopter raid on bin Laden's compound not far from the capital Islamabad as an illegal operation and insisted relations between Washington and Islamabad remain on course.

The army and the government have come under criticism domestically for allowing the country's sovereignty to be violated. Some critics have expressed doubts about government claims that it was not aware of the raid until after it was over.

Foreign Secretary Salman Bashir's remarks seemed to be aimed chiefly at addressing that criticism.

"The Pakistan security forces are neither incompetent nor negligent about their sacred duty to protect Pakistan," he told reporters. "There shall not be any doubt that any repetition of such an act will have disastrous consequences," he said.

Bashir repeated Pakistani claims that it did not know anything about the raid until it was too late to stop it. He said the army scrambled two F-16 fighter jets when it was aware that foreign helicopters were hovering over the city of Abbottabad, but they apparently did not get to the choppers on time.

American officials have said they didn't inform Pakistan in advance, fearing bin Laden could be tipped off.

Asked whether it was illegal, Bashir said only "that is for historians to judge." (read more)

"How Photos from Obama’s Speech on Bin Laden’s Death Were Staged"

There is a fascinating piece at Poynter that describes how since the Reagan era (and possibly before) it has been the standard operating procedure that during a live presidential address, like the one President Obama gave announcing the death of Osama bin Laden, still cameras are not allowed to photograph the actual event.

Photojournalists from Reuters and AP described how President Obama basically had to silently re-enact part of his speech for the still cameras after giving it.

Reuters White House photographer Jason Reed writes:

As President Obama continued his nine-minute address in front of just one main network camera, the photographers were held outside the room by staff and asked to remain completely silent. Once Obama was off the air, we were escorted in front of that teleprompter and the President then re-enacted the walk-out and first 30 seconds of the statement for us.

The reason still cameras are not allowed during live presidential addresses is because of the noise from the camera shutters and the placement of the teleprompter, not for any sinister conspiracy-type reasons like we were hoping. And it’s been going on a long time.

The problem, according to Poynter, is that while many newspapers disclose that the photo they use is a re-enactment, some do not. And publishing these photos goes against the National Press Photographers Association Code of Ethics, which includes this relevant passage: “Resist being manipulated by staged photo opportunities.” (read more)

US Jobless claims hit 8-month high

The number of Americans filing for jobless aid rose to an eight-month high last week and productivity growth slowed in the first quarter, clouding the outlook for an economy that is struggling to gain speed.

While the surprise jump in initial claims for unemployment benefits was attributed to factors ranging from spring break layoffs to the introduction of an emergency benefits program, economists said it corroborated reports this week indicating a loss of momentum in job creation.

New claims for state jobless benefits rose 43,000 to a seasonally adjusted 474,000, the highest since mid-August, the Labor Department said on Thursday. Economists had expected claims to fall to 410,000.

A second report from the department showed nonfarm productivity increased at a 1.6 percent annual rate, braking from a 2.9 percent pace in the fourth quarter. The growth pace was above economists' expectations for 1 percent.

"We do not think that the entire rise in claims over the last month can be explained by special factors alone," said Harm Bandholz, chief U.S. economist at UniCredit Research in New York. "It seems instead as if the improvement in the labor market slowed a bit."

Reports this week showed weaker employment growth in the manufacturing and services sectors in April. Data from payrolls processing firm ADP Employer Services also showed a step back in private hiring last month. (read more)

NDP deputy leader doubts bin Laden photos exist: Canada Parliament

The deputy leader of Canada's new Official Opposition party says he doubts the U.S. has photos of Osama bin Laden's body.

Thomas Mulcair, who stands in for NDP Leader Jack Layton in the House of Commons when he is away, told CBC's Power & Politics with Evan Solomon that he doesn't believe photos exist of bin Laden following his killing by U.S. forces on Sunday in Pakistan.

"I don't think, from what I've heard, that those pictures exist and if they do I'll leave that up to the American military," he told host Evan Solomon.

"If they've got pictures of a cadaver then there's probably more going on than we suspect in what happened there," Mulcair said.

Mulcair also said the killing requires "a full analysis" on whether it was self-defence or a direct killing because "that has to do with American law and international law as well."

"I think that if the Americans have taken pictures in that circumstance, it won't be able to prove very much as to whether Mr. [bin Laden] was holding a weapon," he said. (read more)

Highly radioactive soil found at sea bottom: Japan

Japanese workers entered the No.1 reactor building at the crippled Fukushima Daiichi nuclear plant Thursday for the first time since a hydrogen explosion ripped off its roof a day after a devastating March 11 earthquake and tsunami.

High radiation levels inside the building have prevented staff from entering to start installing a new cooling system to finally bring the plant under control, a process plant operator Tokyo Electric Power (TEPCO) has said may take all year.

The magnitude 9.0 quake and massive tsunami killed about 14,800 people, left some 11,000 missing and destroyed tens of thousands of homes.

It also knocked out the cooling systems at the Fukushima plant, 240 km (150 miles) north of Tokyo, leading to the greatest leak of radiation since the 1986 Chernobyl disaster.

Two TEPCO staff and 11 contractors with protective suits, masks and air tanks worked for 1- hours, moving in and out in small groups to connect duct pipes to ventilators that will filter out 95 percent of the radioactive material in the air, a company spokesman said. (read more)

Researchers Use Virus to Improve Solar-Cell Efficiency -- But is it safe?

Researchers at MIT have found a way to make significant improvements to the power-conversion efficiency of solar cells by enlisting the services of tiny viruses to perform detailed assembly work at the microscopic level.

In a solar cell, sunlight hits a light-harvesting material, causing it to release electrons that can be harnessed to produce an electric current. The new MIT research, published online in the journal Nature Nanotechnology, is based on findings that carbon nanotubes -- microscopic, hollow cylinders of pure carbon -- can enhance the efficiency of electron collection from a solar cell's surface.

Previous attempts to use the nanotubes, however, had been thwarted by two problems. First, the making of carbon nanotubes generally produces a mix of two types, some of which act as semiconductors (sometimes allowing an electric current to flow, sometimes not) or metals (which act like wires, allowing current to flow easily). The new research, for the first time, showed that the effects of these two types tend to be different, because the semiconducting nanotubes can enhance the performance of solar cells, but the metallic ones have the opposite effect. Second, nanotubes tend to clump together, which reduces their effectiveness.

And that's where viruses come to the rescue. Graduate students Xiangnan Dang and Hyunjung Yi -- working with Angela Belcher, the W. M. Keck Professor of Energy, and several other researchers -- found that a genetically engineered version of a virus called M13, which normally infects bacteria, can be used to control the arrangement of the nanotubes on a surface, keeping the tubes separate so they can't short out the circuits, and keeping the tubes apart so they don't clump. (read more)

Siberia's boreal forests 'will not survive climate change'

The boreal forests of Siberia are a vast, homogenous ecosystem dominated by larch trees. The trees survive in this semi-arid climate because of a unique symbiotic relationship they have with permafrost – the permafrost provides enough water to support larch domination and the larch in turn block radiation, protecting the permafrost from intensive thawing during the summer season.

This relationship has now been successfully modelled for the first time, revealing its sensitivity to climate change.

Ningning Zhang and colleagues from Nagoya University, Japan, have predicted that the larch trees will not be able to survive even the most optimistic climate change scenario of a 4 °C increase in summer temperature in Siberia by the year 2100.

"We found that the larch-dominated boreal forest–permafrost coupled system in Siberia would be threatened by future warming of 2 °C or more," Zhang told environmentalresearchweb. "However, our simulations also show that, even with 4 °C warming, some tree species can still survive, but with considerable loss of biomass." (read more)

The Federal Reserve Will Make Sure Obama Wins in 2012: CNBC

As we approach next year's presidential elections, the chances of President Barack Obama being ousted by a rival from either side of the political divide are low, according to Thanos Papasavvas, the head of currency management at Investec Asset Management.

“History is very much on the side of the incumbent President and unless we have a double-dip recession with a significant increase in unemployment I don’t believe Obama will lose 2012,” Papasavvas said in an interview with CNBC on Thursday.

“On the economic side, any signs of a deteriorating economic environment will see the Fed enacting QE3 (the third round of quantitative easing, or creating money) and hence indirectly reducing the probability of the economy derailing Obama,” Papasavvas added.

With the Republicans divided and no major rival yet to emerge, Papasavvas believes the American right wing will keep its powder dry for 2016 when four years of fiscal austerity will play into their hands.

“With no credible Republican heavyweight to face Obama, even those who have indicated their intent to run like Mitt Romney are unlikely to burn significant political or actual capital for 2012 preferring instead to wait for the 2016 election,” said Papasavvas. (read more)

Australia to be port of call for Chinese navy as the Red Dragon expands its wings

CHINESE warships could be heading to Australian ports this year after the Prime Minister, Julia Gillard, took "a few small steps" towards military transparency and co-operation with President Hu Jintao.

Ms Gillard told the Herald last night her key meeting with Mr Hu was "friendly in demeanour".

Her inaugural visit to Beijing as prime minister appears to have bookended two years of tensions which began with China's taking umbrage with the 2009 Australian defence white paper, which it believed painted China as a military threat.

Western defence analysts are also concerned about the potential for a maritime accident triggering war, given China's increasingly assertive conduct and the absence of the kind of maritime incident protocols that defused incidents between the US and the Soviet Union during the Cold War. Ms Gillard said neither Mr Hu nor the Premier, Wen Jiabao, raised any concerns about Australia's military relationships with the US, or its allies, and nor did she raise concerns about the People's Liberation Army. (read more)

Turkey announces plans to build canal to rival Panama, Suez

Less than two months before voters are expected to go to the polls in national elections, Turkish Prime Minister Recep Tayyip Erdogan Wednesday announced ambitious plans to dig a new canal through Istanbul that would bypass the existing Bosphorus Strait.

"Today we are rolling up our sleeves for one of the biggest projects of the century, which will outshine the Panama and Suez Canals," Erdogan said at a party conference.

The proposed Istanbul Canal would run for more than 45 kilometers, or about 28 miles, from the Black Sea through Turkey's largest city and commercial capital, to the Marmara Sea -- roughly parallel to the Bosphorus Strait, the natural body of water that already bisects Istanbul.

The Panama Canal is 77 kilometers (roughly 48 miles) in length, while the Suez Canal in Egypt is more than 190 kilometers (118 miles) long.

Erdogan said one of the goals of the proposed canal would be to reduce the huge amount of international cargo ships that regularly traverse the congested Bosphorus.

"One of the most important reasons for this project will be to reduce Bosphorus traffic and minimize threats," Erdogan said, in comments published on the prime minister's official web-site.

More than a 100 ships a day sail up and down the Bosphorus. Many of them carry dangerous cargos of crude oil and liquefied petroleum gas (LPG). The fast currents and narrow bends in the historic channel have led to several accidents on the banks of Turkey's most populous city. The deadliest incident took place in 1979, when a Romanian oil tanker exploded after colliding with another vessel, killing dozens of people and leaking tons of oil into the sea. (read more)

BREAKING NEWS: 6.1 Magnitude Earthquake of the Coast of Honshu, Japan - 5th May 2011

A magnitude 6.1 earthquake struck of the Coast of Honshu, Japan at a depth of 24.2 km (15 miles), the quake hit at 14:58:21 p.m. UTC Thursday.

The epicenter was 471 km (292 miles) from Tokyo, Japan

No tsunami watch, warning or advisory is in effect. - No reports of damage

Revealed: North Korea's growing gulags where 200,000 are imprisoned and many don't even know what they're accused of - 5th May 2011

The plight of inmates in North Korea's huge network of Soviet-style gulags has been revealed in a report by human rights campaigners.

Satellite images of the camps, released by Amnesty International, showing four of the six camps located in vast wilderness sites in South Pyongan, South Hamkyung and North Hamkyung provinces.

A comparison with satellite pictures from 2001 indicated a significant increase in the scale of the camps, which are believed to have been operating since the 1950s, it said.

The human rights group spoke to a number of people, including former inmates from the political prison camp at Yodok, as well as guards in other camps, revealing what it said were horrific conditions.

Thousands of people are believed to be held as 'guilty-by-association' or sent to the camps simply because one of their relatives has been detained. A significant proportion don’t even know what crimes they’re accused of.

The former detainees said prisoners were forced to work in conditions close to slavery and were frequently subjected to torture and other cruel, inhumane, and degrading treatment.

All the detainees at Yodok had witnessed public executions, it said.

Furthermore, food is scarce in the camps. Amnesty International said it had been told of several accounts of people eating rats or picking corn kernels out of animal waste to survive.

Amnesty called on North Korea, one of the world's most secretive states, to close all political prison camps and to release all prisoners of conscience.

'North Korea can no longer deny the undeniable. For decades the authorities have refused to admit to the existence of mass political prison camps,' said Sam Zarifi, Amnesty International's Asia Pacific director.

'As North Korea seems to be moving towards a new leader in Kim Jong-un and a period of political instability, the big worry is that the prison camps appear to be growing in size,' he said, referring to the son and presumed successor of Kim Jong-il. Read More

Massive asteroid hurtling towards Earth (but don't worry, scientists say it will just miss us) - 5th May 2011

A massive asteroid will fly within the moon's orbit narrowly missing Earth later this year.

The space rock, called YU55, will hurtle past our planet at a distance of just 201,700 miles during its closest approach on November 8.

That is closer to Earth than the moon, which orbits 238,857miles away on average.
With a width of some 400metres and weighing 55million tons, YU55 will be the largest object to ever approach Earth so close.

Nasa spokesman Don Yeomans said: 'On November 8, asteroid YU55 will fly past Earth and at its closest approach point will be about 325,000kms away.

'This asteroid is about 400 metres wide - the largest space rock we have identified that will come this close until 2028.'

Despite YU55's close proximity to Earth, its gravitational pull on our planet will be 'immeasurably miniscule'.

Mr Yeomans added: 'During its closest approach, its gravitational effect on the Earth will be so miniscule as to be immeasurable. It will not affect the tides or anything else.'

It is, however, still officially labelled a 'potentially hazardous object' - if it was to hit Earth, it would exert a force the equivalent of 65,000 atomic bombs and leave a crater six miles wide and 2,000ft deep.

YU55 was discovered by Robert McMillan, head of the Nasa-funded Spacewatch Program at the University of Arizona, Tucson in December 2005. Read More

13 People Sent to Hospital in Hazmat Situation‎, New York - UPDATE: Cause of Hazmat Scare Remains Unknown - 5th May 2011

Thirteen people at a local community health clinic were treated and released at Evergreen Medical Center in Redmond after they reported feeling nauseous and dizzy this morning.

Crews from the Redmond Fire Department responded to the scene at Healthpoint clinic on Northeast 87th Street at about 9:30 a.m., said department spokesman Jim Bove. Initial air tests did not show anything abnormal, and the Eastside Hazardous Materials Team was called in to perform its own tests, which also did not detect anything amiss.

An FBI Haz-Mat team was called to the scene as a precautionary measure, Bove said, and crews from the Woodinville and Bellevue fire departments were also on the scene.

"At this point ... there are really no red flags going up on our end," Bove said.

Northeast 87th Street was closed between 161st and 164th avenues northeast for several hours and reopened at about 2:30 p.m.

Debbie Wilkinson, chief operations officer for Healthpoint, said employees in the health center noticed something was amiss when they detected an odor toward the back of the building.

"Staff started feeling light-headed and nauseous," she said, adding that the workers have no idea what caused them to feel sick.

"It's an unknown at this point," Wilkinson said. Read More

"They'll turn the place upside down looking for anything that might have caused this," he said. "We're not going to open until we know what's going on."

Nuclear Event - Nuclear leak forces Russian icebreaker back to port - 5th May 2011

A NUCLEAR leak on a Russian icebreaker off the coast of western Siberia forced the vessel to head back to port, Russia's nuclear fleet, Rosatomflot, said today.

The "insignificant increase in activity" in the Taimyr atomic icebreaker was noticed as the vessel was leaving the Yenisei Gulf region of the Kara Sea, Rosatomflot said in a statement. The Kara Sea, part of the Arctic Ocean, lies east of the Barents Sea.

The Taimyr is now returning to its port in the northwestern city of Murmansk, it added.

"If the situation deteriorates, the reactor system will be shut down, and the cooling process will begin," Rosatomflot said.

The statement did not say how many people were on board the vessel, adding only that according to the International Nuclear and Radiological Event Scale, the event could be registered as "a zero," or bearing no safety significance. Source