Falklands to hold referendum on status

by: From correspondents in London From: AFP June 13, 2012

THE Falkland Islands will hold a referendum on its political status in the first half of 2013, the British ruled territory's government has announced.

"We have decided, with the full support of the British government, to hold a referendum on the Falkland Islands to eliminate any possible doubt about our wishes," Gavin Short, chairman of the Falklands' legislative assembly, said today.

The government said the island did not wish to be ruled by Argentina.

http://www.couriermail.com.au/news/breaking-news/falklands-to-hold-referendum-on-status/story-e6freonf-1226393659784

Syria in full-scale civil war, United Nations says

by: AFP From: AFP June 13, 2012 7:14AM

SYRIA is now in a full-scale civil war, UN peacekeeping chief Herve Ladsous said, as UN observers report being fired on as they tried to enter a town feared to be the focus of a new massacre.

..US Secretary of State Hillary Clinton has warned Washington will find it hard to support the extension of the observer mission beyond next month if the government of President Bahar al-Assad's regime continues to show "contempt" for a UN-backed ceasefire that was supposed to go into effect from April 12.

Asked whether he believed Syria is in a civil war, Mr Ladsous said: "Yes I think we can say that. Clearly what is happening is that the government of Syria lost some large chunks of territory, several cities to the opposition, and wants to retake control."

"I think there is a massive increase in the level of violence, so massive indeed that in a way it indicates some change of nature," he said.

"Now we have confirmed reports of not only of the use of tanks and artillery but also attack helicopters."

The under-secretary-general for peacekeeping operations is the most senior UN official to indicate he believes there is a civil war. UN leader Ban Ki-moon said last week that he believed it was "imminent".

The UN Supervision Mission in Syria had been trying to reach the northwestern town of Al-Haffe, a Sunni Muslim enclave in a region mainly populated by members of Mr Assad's Alawite minority, where hundreds of civilians are reported trapped by an army siege of holed up rebel fighters.

The mission said it had received reports of "a large number of civilians, including women and children trapped inside the town and are trying to mediate their evacuation".

At least 120 people have been killed in the fighting in and around Al-Haffe over the past week, including 68 troops, 29 civilians and 23 rebel fighters, with hundreds wounded, according to the Britain-based Syrian Observatory for Human Rights.

The UN observers were forced to abandon their attempt to reach the town yesterday when an angry crowd in a nearby pro-government village threw rocks and metal bars at them, and unknown assailants then fired on them.

Mr Ladsous said one military observer came close to being hit by a bullet.

"We thought he was injured but in fact the bullet did not enter him but hit his boot.

"There were many impacts that hit the car, so it was deliberate," he said.

Another UN official said the crowd that surrounded the UN convoy was carrying government flags and at least 20 bullets hit the car carrying the observers.

Mrs Clinton said renewing the mission would be difficult without progress in implementing the six-point peace plan brokered by UN-Arab League envoy Annan, and also hit out at Moscow for sending attack helicopters to its Damascus ally.

"We are concerned about the latest information we have that there are attack helicopters on the way from Russia to Syria, which will escalate the conflict quite dramatically," she said.

"We have confronted the Russians about stopping their continued arms shipments to Syria. They have from time to time said we shouldn't worry, that everything they're shipping is unrelated to their actions internally. That's patently untrue."

http://www.heraldsun.com.au/news/more-news/syria-in-full-scale-civil-war/story-e6frf7lf-1226393726840

Recession took Americans' net worth back to 1992 Washington
June 13, 2012

THE recession shrank Americans' wealth so much that in 2010 median family net worth was no more than it had been in 1992 after adjusting for inflation, the US Federal Reserve says.

Median net worth declined from $US126,400 in 2007 to $US77,300 in 2010, a Federal Reserve survey of family finances has found.

The median marks the point where half had more and half had less. The recession officially began in December 2007 and ended in June 2009.

Net worth is the value of assets such as homes, bank accounts and shares, minus debts including mortgages and credit cards.

The Federal Reserves's findings are in its latest Survey of Consumer Finances, a comprehensive review of household finances that it carries out every three years.

A separate survey the Federal Reserve released last week showed that total family net worth climbed 4.7 per cent in the March quarter to $US62.9 trillion, about 28 per cent above its recession low. The increase was fuelled by stockmarket gains.

Those gains put net worth about 5 per cent below its pre-recession peak. But since the first quarter, lower share prices have eroded some household wealth.

Among families that owned homes, the consumer finances survey found that their median home equity declined from $US95,300 in 2007 to $US55,000 in 2010, a drop of 42.3 per cent.

The survey found that median income fell from $US49,600 in 2007 to $US45,800 in 2010, a drop of 7.7 per cent.




Read more: http://www.theage.com.au/world/recession-took-americans-net-worth-back-to-1992-20120612-2082c.html#ixzz1xceFUnYG

Russians stage huge protest defying Putin’s tough line Moscow
June 13, 2012

TENS of thousands of Russians have flooded Moscow’s tree-lined boulevards in the first massive protest against President Vladimir Putin’s rule since his inauguration.

Investigators sought to raise the heat on the opposition by summoning some of its leaders for questioning yesterday just an hour before the march.

The rally comes as a key test of Mr Putin’s line towards the opposition, following quick passage of a repressive bill introducing heavy penalties for taking part in unauthorised rallies.

Searches of opposition leaders’ apartments and their interrogation were widely described as a crude attempt by the government to scare the protesters.

Leftist politician Sergei Udaltsov snubbed the summons, saying on Twitter that he considered it his duty to lead the protest as one of its organisers. The Investigative Committee said it would not immediately seek his arrest but would interrogate him later.

Anti-corruption blogger Alexei Navaly, liberal activist Ilya Yashin and TV host Ksenia Sobchak attended the interrogation session that prevented them from attending the demonstration.

Investigative Committee spokesman Vladimir Markin said authorities had found more than €1million ($A1.27million) in cash at Ms Sobchak’s apartment and would check to see if she had paid her taxes.

Ms Sobchak, the daughter of a late mayor of St Petersburg, who was Mr Putin’s mentor, had been spared reprisals until Monday’s raid. ‘‘I never thought that we would slide back to such repressions,’’ she tweeted on Monday.

Braving a brief thunderstorm, protesters showed up early on the landmark Pushkin Square and their number grew as they marched to the rally.

Despite fears of unrest following a violent police crackdown on a protest last month, the demonstration went on peacefully.

Mr Udaltsov put the number of protesters at 50,000, while police estimated that about 18,000 showed up.

AP




Read more: http://www.theage.com.au/world/russians-stage-huge-protest-defying-putins-tough-line-20120612-20818.html#ixzz1xcfjobEA

Tunis declares curfew after 'Islamist' rioting

Tunisia has declared an overnight curfew on eight regions, including the capital, an interior ministry official says, in the wake of serious rioting.

The eight-hour curfew was introduced after several violent attacks in protest at an art exhibition.

The government has blamed ultra-conservative Islamists known as Salafists for the violence, in which police stations were set on fire.

But the Salafists have denied being involved in the rampage.

The curfew will be in place in the suburbs of Ben Arouss, Ariana and Manouba as well as the cities of Sousse, Monastir, Jendouba and Ben Guerdane.
'Heavy price'

Monday's overnight series of attacks targeted police stations, a court and an art gallery.

In one northern suburb, La Marsa, rioters tried to force their way into an art gallery where several paintings deemed "blasphemous" had been slashed a day earlier by Islamists.

The exhibition included paintings that caricatured Mecca, portrayed a nude woman, and showed the word "Allah" spelled out with strings of ants.

The offices of Tunisia's main labour union in the north-west city of Jendouba were also set alight by Salafis overnight, state television reported according to Reuters.

The country's Justice Minister Nourredine Bhiri said that those behind the violence would "pay a heavy price".

"These are terrorist groups which have lost control, they are isolated in society," he told a Tunisian radio station.

He said some of the violence, which came hours after al-Qaeda leader Ayman al-Zawahiri urged Tunisians to turn against the government, may have been inspired by the group.

An official from the justice ministry said that those arrested would be brought to justice under a 2003 anti-terror law, AFP reports.

The Salafist movement called on Tunisians to protest against "infringements against Islam" but said it had nothing to do with the violence.

Since the fall of Tunisia's autocratic leader Zine al-Abidine Ben Ali, in January 2011, there has been a resurgence of hard-line Islamists in the country.

Some of the Salafists' most radical branches have been holding demonstrations to demand an introduction of Sharia in Tunisia.

Spain insists bank rescue has no austerity strings

Updated: 11:32, Wednesday, 13 June 2012

Spain's government insisted that a vast euro zone rescue loan for its banks comes with no new strings related to austerity or broader economic reforms.

Facing parliamentary questions over the loan of up €100 billion to salvage the banks, Economy Minister Luis de Guindos denied it imposed new conditions beyond the financial sector.

Loan conditions would be specific to the banking sector with no requirement for a broader austerity programme, he told parliament.

"I insist there are no supplementary conditions on budget policy, nor structural reforms," he said.

There would be no new recommendations beyond those made by the European Commission on May 30 as part of its monitoring of Spain for exceeding agreed public deficit limits, the minister said.

European Union economic and finance chiefs would decide on those recommendations "soon", he said. Prime Minister Mariano Rajoy stressed that banks would have to repay the money.

"It is a credit for the banking system that the banking system itself will have to pay, and we should celebrate the fact that our European partners have helped us," he told parliament.

Spain urged ECB to take urgent action in crisis

Spain's Prime Minister Mariano Rajoy called for the European Central Bank to intervene urgently to calm financial markets in a letter dated June 6 and released today.

Rajoy wrote the letter to European Union president Herman van Rompuy and European Commission chief Jose Manuel Barroso three days before the euro zone agreed a vast rescue loan for Spain's banks.

"Given the deep-seated doubts about the euro, the speed of financial markets and the flight of liquidity from the periphery to the centre, we need to act with urgency to stabilise financial markets and lower risk premiums," he said.

"Businesses and households need access to liquidity. That is impossible if doubts persist over the sustainability of the debt of sovereign states," Rajoy warned.

Europe needed the necessary instruments to calm market fears, the prime minister added.

"Today, the only institution we have with the capacity to assure the required conditions of stability and liquidity is the European Central Bank," the Spanish leader said.

"Assuring financial stability is, at this time, essential to show the commitment of member states to the irreversible nature of the euro," he cautioned.

Spain borrowing costs still a cause of concern

Spanish borrowing costs remain at euro-era record highs on a market beset by doubts over a vast rescue loan for the country's banks and by fears of a Greek exit from the euro zone.

Investors remain unconvinced by the deal struck by the 17 euro zone nations over the weekend to extend Spain a banking sector rescue loan of up €100 billion.

Two major concerns stood out: doubts over Spain's outlook even with the euro zone rescue, and Greek elections on Sunday, which in a worst-case scenario could send Athens back to using the drachma.

Adding to Spanish agony, Fitch Ratings yesterday downgraded 18 more Spanish banks a day after cutting its ratings on the two biggest banks, Santander and BBVA, despite the massive sector bailout.

Spain's benchmark 10-year government bond yield spiked to 6.834%, the highest since the creation of the euro. While it later eased to stand at 6.716%, this rate is still regarded as unsustainable over the longer term.

The nation's risk premium - the extra rate investors demand to hold its 10-year bonds over their safer German counterparts - hit 5.43 percentage points, not far from the euro-era record of 5.48 percentage points struck shortly before the banking rescue.

Far from calming the markets, the rescue for Spain exposed a string of new doubts over the impact on the debt; how it will be implemented; and whether it will be just the first rescue for a nation struggling to cut deficits in a period of recession and sky-high unemployment.

Spain is expected formally to seek the loan at a euro zone finance ministers' meeting June 21, and a final figure would come after a review by the European Union, European Central Bank and IMF, officials said.

And tiny Cyprus has added to the gloom. Cyprus Finance Minister Vassos Shiarly told journalists earlier this week that his country had an "exceptionally urgent" need for a bailout to recapitalise its banks by June 30, according to The Wall Street Journal.

Moody's ratings agency downgraded two Cyprus banks yesterday, citing their large exposure to a possible Greek exit from the euro zone, including chopping its rating for Bank of Cyprus by one notch to B2 from B1.

The big spectre, however, remains Greece, and the prospect that the anti-austerity party Syriza will win elections on Sunday, rejecting the terms of Athens' international bailout and leading possibly to its departure from the 17-nation single currency bloc.

Meanwhile the World Bank yesterday warned developing countries to boost their defences against Europe's debt crisis, predicting years of volatility in a flailing global economy.

http://www.rte.ie/news/2012/0613/spain-insists-bank-rescue-has-no-austerity-strings.html

World braces for Greek election fallout

June 17, 2012 - 8:45AM


One historian describes today's vote in Greece as the financial version of the Cuban Missile Crisis.

European leaders are seeking to calm fears that the Greek election would trigger a Lehman Brothers-style run on eurozone banks after polls showed the leftist Syriza group could deny pro-austerity parties overall control in today's election.

The British prime minister, David Cameron, joined the German chancellor, Angela Merkel, and the French president, Francois Hollande, in emergency talks to prepare for the aftermath of a vote that the historian Niall Ferguson warned was ‘‘the financial equivalent of the Cuban missile crisis’’.

Stock markets are expected to fall when they open on Monday if voters fail to produce a clear result, as happened in May. Leaders also fear a mass withdrawal of bank savings, forcing governments to launch expensive rescue bids for vulnerable banks or risk a destabilising collapse.

Greece’s interim prime minister warned that the country was at a critical juncture because the election could determine its future in the eurozone. The brinkmanship between Athens and Brussels appeared to be giving way to a final confrontation.

Panagiotis Pikrammenos, the prime minister, spoke of ‘‘dangerous inertia’’ in state operations and the need for ‘‘critical’’ decisions to be made after a two-month delay in promised reforms while back-to-back electoral campaigns were held.

Greece is holding its second election in six weeks with all leading candidates now calling for some renegotiation of a bailout deal despite warnings that Greece must toe the line or leave the euro.

Alexis Tsipras, the leader of the Syriza group, repeated his threat to tear up the agreement between Athens and Brussels and call Europe’s bluff. He said the eurozone will not eject Greece for fear of the consequences for other indebted members, such as Spain and Italy. His main rival, Antonis Samaras, said Greece risked becoming a pariah if it defaulted .

Greece has already negotiated with its private sector creditors a 105 billion-euro ($131 billion) cut in its loans, which was expected to reduce its debts from almost 190 per cent of national income to nearer 130 per cent. It was offered a second package of loans earlier this year in return for public sector spending cuts and economic reforms, most of which have yet to be implemented.

Samaras, in his final rally, said Greeks were deluded if they believed they could avoid much needed reforms and the vote was between the drachma and the euro. ‘‘If we cancel the bailout plan, we will turn into the black sheep of Europe,’’ he said, imploring voters not to trust Tsipras.

Samaras is the bookmakers’ favourite, but is still expected to fall short of an overall majority following strong showings for the far right Golden Dawn party and Tsipras’s Syriza leftist coalition.

'Cuban Missile Crisis' equivalent

Niall Ferguson, the Harvard historian, commented: ‘‘If there’s going to be a Lehman moment in the crisis it’s going to be next week.’’

He likened negotiations between Athens and Berlin to ‘‘a game of chicken’’ that will continue while Athens is plagued by hung parliaments. ‘‘It’s not clear who’s going to blink at this point. My guess is that, in the end, there will be a bit of blinking on both sides.

‘‘This is the financial equivalent of the Cuban missile crisis. And the missile is really a bank run, which ultimately even the Germans can’t be completely immune to. Not that there will ever be a run on German banks, but the effects of a bank run across southern Europe are going to be felt by the economy. German policymakers know that; they’re having to say one thing to their own voters and another thing privately to other European leaders.’’

Merkel has warned that eurozone countries must follow agreed austerity measures in speeches in recent weeks designed to warn Greek voters that a new loan deal is out of the question. However, she has come under intense pressure to take a more kindly view of the situation after the Spanish bank rescue, which it is understood Madrid won on easier terms.

Holding her tough line is also expected to become more difficult after the International Monetary Fund said Spain would miss its deficit reduction target this year and Ireland would need softer terms on its existing bailout to survive.

Brussels is duty bound to fine Madrid for missing deficit reduction targets, something it will find difficult to justify only weeks after it sanctioned the 100 billion euro ($125 billion) rescue of Spain’s smaller banks. Dublin has pleaded for easier terms on its loans on several occasions only to be rejected.


The review by the IMF - one of three lenders, with Brussels and the European Central Bank, funding eurozone bailouts - will further isolate the German leader, who told her parliament on Wednesday that Germany could not be expected to dig deeper to fund easier terms.

‘‘Germany’s strength is not unlimited,’’ she said. ‘‘The way out of the crisis can only be successful if all countries are capable of recognising the reality and realistically assessing their strengths.’’

There are rising concerns that Italy’s economy is only months away from needing a rescue deal.

Guardian
http://www.theage.com.au/business/world-business/world-braces-for-greek-election-fallout-20120617-20hn1.html

Egyptian runoff elections today will see Islamists take true power. Those poor people that gave up their lives in the fight for a truly free, fair & democratic place to live all died in vain thanks to the tyranny of the majority.

Greeks vote for euro as pro-bailout parties claim victory

June 18, 2012 - 6:07AM


The pro-bailout New Democracy party has come in first in the Greek election, and its leader has proposed forming a pro-euro coalition government.

In claiming victory, New Democracy leader Antonis Samaras said "the Greek people today voted for Greece to remain on its European path and in the eurozone".

He said voters chose "policies that will bring jobs, growth, justice and security".

His party beat the anti-bailout Syriza party, which wanted to cancel Greece's international bailouts.

Syriza chief Alexis Tsipras, a 37-year-old former communist who has shot from obscurity to global celebrity in a matter of weeks, has conceded defeat in the election.

Although no party has won enough seats to form a new government on its own, the polls indicate the country's two traditional parties - New Democracy and Pasok - will have enough seats to form a coalition together.

An official projection released by the interior ministry showed conservative New Democracy taking 29.5 per cent, with the radical leftist Syriza bloc just behind on 27.1. The Pasok Socialists were set to take 12.3 per cent of the vote.

Because of a 50-seat bonus given to the party which comes first, that result would give New Democracy and Pasok 161 seats in the 300-seat parliament, in an alliance committed to a 130 billion euro ($164 billion) EU/IMF bailout keeping the country from bankruptcy.

"I am relieved," a smiling Samaras told Reuters, leaving his office to joyous chants from supporters. "I am relieved for Greece and Europe. As soon as possible we will form a government."

Samaras said in a speech that the country would honour its commitments to its euro zone partners.

"The Greek people voted today to stay on the European course and remain in the euro zone... there will be no more adventures, Greece's place in Europe will not be put in doubt," he said.



The result, however, exposed a deeply divided society, and could leave an emboldened Syriza leading new protests against a coalition governing with significantly less than 50 per cent of the electorate's support.

Pasok leader Evangelos Venizelos called for a government that would include Syriza , but the radicals ruled out joining a coalition that would stick to the punishing bailout terms that have helped condemn Greece to five years of record recession.

Tsipras had vowed to tear up the terms, betting that European leaders cannot afford the financial market turmoil that could be unleashed by cutting a member of the euro zone loose.

The projection was based on votes counted on the spot at about 12 per cent of polling stations and sent to the ministry via text message.

It proved highly accurate in an earlier May 6 election, which produced stalemate, though the figures are subject to a margin of error which leaves a degree of uncertainty. Earlier exit polls produced a similar result to the government projection, giving New Democracy and Pasok 159 seats combined.

Greece's lenders say a new government must accept the conditions of the bailout - on top of a 110 billion euro package in 2010 - or funds will be cut off, driving Athens into bankruptcy.

A Greek euro exit has the potential to unleash shocks that could even break up Europe's single currency and plunge the global economy into chaos. The result will dominate a meeting of the Group of 20 world economic powers in Mexico today.

Central banks from major economies stand ready to take steps, including coordinated action, to stabilise markets if the election triggers a financial storm or public panic, G20 sources told Reuters last week.

They may well not be needed.

The euro hit a three-week high against the US dollar, rising to around $1.2730 in early Monday trade, from around $1.2655 late in New York on Friday. It hit its strongest since May 22 according to Reuters charts.

"What stands out is how close Syriza came... so we expect some robust opposition to the austerity measures," said Daragh Maher, currency strategist at HSBC in London. "Markets will be concerned about how narrow the margin of victory was for ND and any gains in the euro and other markets will be limited."

Last chance

The ultra-right Golden Dawn party looked set to win 18 seats, underscoring the fragmentation of a society wrestling with unemployment of almost 23 per cent and plummeting living standards.

The traditional ruling parties of New Democracy and the Pasok Socialists are accused by many Greeks of presiding over decades of corruption and waste which have left them with a ruined economy and one of the heaviest debt burdens in the world.

Five years of recession and more than two years of acute crisis have started to fray the edges of Greek society, undergoing its severest test since the overthrow of the military dictatorship in 1974.

The streets of central Athens are scarred by repeated waves of protests, some hospitals are short of vital medicines and reports of suicides caused by the crisis have become routine.

Samaras has called for an extra two years to make the cuts demanded of his country. But Greece's euro zone peers are prepared only to tinker with the deal and then only with a government firmly committed to the bailout.

"There can't be substantial changes to the agreements but I can imagine that we would talk about the time axes once again, given that in reality there was political standstill in Greece because of the elections, which the normal citizens shouldn't have to suffer from," German Foreign Minister Guido Westerwelle said on German TV station ARD.

"But there is no way out of the reforms. Greece must stick to what has been agreed," he said.

Opinion polls show Greeks, weary and disillusioned after five years of deep recession, overwhelmingly favour remaining in the euro and just as opposed to the austerity drive.

"I voted for the bailout because these are the terms that will keep us in Europe," said 66-year-old English teacher Koula Louizopoulou after casting her ballot in Athens, hinting that she had chosen New Democracy.

"It's the first time I feel depressed after voting, knowing that I voted again for those who created the problem, but we don't have another choice," she added.

Reuters, AP

http://www.smh.com.au/world/greeks-vote-for-euro-as-probailout-parties-claim-victory-20120618-20iol.html