Security officials say rioters have stormed a Muslim Brotherhood headquarters building in northern Egypt, and a teenage protester was killed.
It was the first death in three days of street battles after a power grab by the country’s president.
A 15-year-old died and 40 people were injured in the clash between protesters and police late Sunday in the town of Damanhoor in the Nile delta, according to security officials. They spoke on condition of anonymity because they were not authorized to brief reporters.
The demonstrators are protesting Egyptian President Mohammed Morsi’s decree granting himself immunity from judicial review as well as other measures neutralizing the judges.
Egypt’s stock market plummeted nearly 10 percent on Sunday, the first day of trading since Morsi’s assumption of extra powers.
Morsi will meet senior judges on Monday to try to ease a crisis over his seizure of new powers which has set off violent protests reminiscent of last year’s revolution which brought him to power.
The supposed endgame behind the whole “starve the beast” plan was to end up creating a crisis that would force the elimination of Social Security and Medicare.
Those two programs have long been a major thorn in the side of ideological conservatives because they refute basic conservative dogma by…
1. Being government programs designed to help the entire population.
2. Actually working.
3. Being tremendously popular.
These facts damage one of the primary tenets of conservatism, that government doesn’t work, period. Why do you think they have also tried so hard for a plan “B” by their repeated plans and attempts to privatize both programs? Luckily for us those plans have always failed, at least so far.
By purposefully being fiscally irresponsible by lowering taxes while increasing government spending over 30 years the GOP has sent both the debt and the deficit skyrocketing. Their problem is that now that they finally have the “crisis” they have been trying to engineer, they lack enough public support to follow through. The overwhelming majority of the population wants to keep SS and Medicare going, even exits polls in this election confirmed that.
Those same polls and others have also shown that most people understand that a combination of both spending cuts and increased revenues via higher taxes is necessary. Not only to try to shore up the viability of the social programs but to avoid more damage to our credit rating and ultimately a possible economic crash and default on our debt.
The funny part of all this is that by agreeing to sequestration the GOP has now painted itself into a corner where taxes will go up no matter what happens. I don’t see how they can spin this into a win politically even with their PR machine cranked up to 11. As I said elsewhere here, Obama simply outplayed them in the “long game.” The Dems planned for this at the last debt ceiling negotiations while the Republicans failed to think it all the way through.
Personally I am going to stock up on a lot of popcorn because we are about to see four weeks worth of crying, whining, and hand wringing by the GOP. Regardless of what happens during those weeks the deficit will eventually end up being reduced and the Republicans are not likely to get much of the credit for doing so. Who knows, maybe instead of simply using it as a slogan the Republicans will finally see the need to actually become a fiscally responsible party in the end?
/Not holding my breath
Turkish artillery has fired on positions inside Syria after shells from Syria killed five people in a southern Turkish border town.
A woman and her three children were among those killed earlier when the shells, apparently fired by Syrian government forces, hit Akcakale.
Turkey’s response marks the first time it has fired into Syria during the 18-month-long uprising against Syrian President Bashar al-Assad.
Nato ambassadors discussed the crisis.
The military alliance issued a statement saying it “continues to stand by (Nato member) Turkey and demands the immediate cessation of such aggressive acts against an ally, and urges the Syrian regime to put an end to flagrant violations of international law”.
Turkey’s territory has been hit by fire from Syria on several occasions since the uprising against President Assad began, but Wednesday’s incident was the most serious.
Retirement security seems to be an issue that the candidates running for president are running away from. But they shouldn’t, according to growing number of executives in the financial services industry.
In fact, executives and others are demanding that President Barack Obama and Gov. Mitt Romney, the presumptive Republican candidate, lay out their respective positions on various retirement security issues, such as Social Security, automatic IRAs and the like.
Earlier this month, for instance, Robert Reynolds, the chief executive officer of Putnam Investments, asked in no uncertain terms that Obama and Romney endorse the tax incentives now in place for retirement saving programs such as the 401(k) and start debating how to make Social Security solvent.
In short, Reynolds called on the candidates from both political parties to recognize retirement security as not only a vital national challenge, but a key element in solving our nation’s debt and deficit crisis over the long term. “If we solve the retirement challenge it would have a huge benefit for all Americans,” Reynolds said in an interview. “If someone’s future is secure, it allows them to do so much more with their lives.”
Weeks later, we’re still waiting.
Bad news, everyone. Researchers have discovered that 15% of the coral trout living in Australia’s great Barrier Reef are suffering from what’s been described as a scalier version of melanoma, a deadly form of skin cancer. That’s unsettling for a number of reasons, but there are two big ones that should immediately give you pause.
1) This is the first case of melanoma ever documented in a wild fish population.
2) The Great Barrier Reef is directly beneath a gaping hole in Earth’s ozone layer.
In other words, this is the first (disturbingly strong) evidence that fish are developing skin cancer from ultraviolet radiation outside of a research laboratory. Two coral trout with melanoma can be seen up top (far left and center). A healthy coral trout, pictured above on the far right, shows that the fish is usually completely orange. Writes Science NOW’s Krystnell Storr:
After 30 years—some historians might say 100 years—of rhetoric about the “crisis” in American education, it’s getting hard to come up with new ways to frighten the public about the state of American schools. So maybe it’s understandable that the Council on Foreign Relations chose a foreboding title for its March report: “U.S. Education Reform and National Security.” The message is even blunter in one of the chapter titles, “The Education Crisis Is a National Security Crisis.” The council points to a slew of subpar standardized test scores as well as to the surprising fact that 75 percent of young people don’t qualify for military service. (Education is hardly the only reason for that; criminal records and lack of physical fitness can also be disqualifiers.) The solutions recommended by the council task force, co-chaired by former Secretary of State Condoleezza Rice and former New York City public-schools chief Joel Klein, are almost as well worn as the crisis talk: Parents need more vouchers, which let them use public dollars for private schools; teachers need to be easier to fire; and we all need more charter schools.
“I think we should raise the alarm level,” Klein told PBS NewsHour. “When a secretary of state calls this out as a national-security issue … I think we need to stop thinking this is somehow a narrow education problem and we will all be fine.”
The message, boiled down, has a familiar ring: Schools have failed, and we desperately need alternatives—or we will not be fine. Based on the urgent tone, you might think that lawmakers had been ignoring the education-reform movement. But the reformers’ policy agenda has been widely embraced. Between 1999 and 2009, the number of American students in charter schools tripled. Vouchers also experienced a boom, with 19 states now offering programs. Several states have made it easier to fire teachers.
Rodrigo Rato, the executive chairman of Bankia, resigned Monday before an anticipated government recapitalization of the company, Spain’s largest real estate lender, which is sitting on €32 billion of troubled assets.
Mr. Rato, a former finance minister and past managing director of the International Monetary Fund, is the most prominent Spanish banker to quit since the start of the euro zone’s sovereign debt crisis, which has raised concerns not only about the solvency of Spain’s banks but of its economy as a whole.
While the government and the central bank have been debating in recent days how to clean up the balance sheets of the most troubled banks, Prime Minister Mariano Rajoy confirmed for the first time Monday that such a rescue plan could involve public money. Earlier, he had pledged not to make taxpayers bear the cost of saving the banks.
Bankia is now expected to receive €7 billion to €10 billion, or $9.1 billion to $13 billion, of additional state funding, in the form of convertible bonds, according to reports Monday in the Spanish media.
“Something urgently had to be done about Bankia because the size of its problematic assets made it the most delicate and dangerous part of the whole financial sector,” said Jordi Fabregat, a finance professor at the Esade business school in Barcelona. “What’s unclear is whether this will be enough to restore confidence among investors, or whether in fact €10 billion will end up being a drop in the ocean should all the problematic assets turn out to be worth zero.”
Lawmakers from Egypt’s Muslim Brotherhood traveled to Saudi Arabia on Thursday in a bid to lower the flames of a simmering dispute that is the biggest rift in decades between the two most powerful Arab states.
The speakers of Egypt’s upper and lower houses of parliament, both senior members of the Brotherhood, joined a delegation meeting Saudi King Abdullah over the crisis triggered by Riyadh’s arrest of an Egyptian lawyer and a wave of protests that it generated. This weekend the Saudis withdrew their ambassador from Egypt, citing security concerns following the demonstrations over Ahmed el-Gizawi’s detention on April 17.
The Saudi government has been the focus of public anger triggered by the arrest, with Egyptians pouring criticism on what they say is the poor treatment their compatriots often receive in the kingdom. Egyptian activists said Gizawi had been detained for speaking out against such ill-treatment.
Last year physicists commemorated the centennial of the discovery of the atomic nucleus. In experiments carried out in Ernest Rutherford’s laboratory at Manchester in 1911, a beam of electrically charged particles from the radioactive decay of radium was directed at a thin gold foil. It was generally believed at the time that the mass of an atom was spread out evenly, like a pudding. In that case, the heavy charged particles from radium should have passed through the gold foil, with very little deflection. To Rutherford’s surprise, some of these particles bounced nearly straight back from the foil, showing that they were being repelled by something small and heavy within gold atoms. Rutherford identified this as the nucleus of the atom, around which electrons revolve like planets around the sun.
This was great science, but not what one would call big science. Rutherford’s experimental team consisted of one postdoc and one undergraduate. Their work was supported by a grant of just £70 from the Royal Society of London. The most expensive thing used in the experiment was the sample of radium, but Rutherford did not have to pay for it—the radium was on loan from the Austrian Academy of Sciences.
Nuclear physics soon got bigger. The electrically charged particles from radium in Rutherford’s experiment did not have enough energy to penetrate the electrical repulsion of the gold nucleus and get into the nucleus itself. To break into nuclei and learn what they are, physicists in the 1930s invented cyclotrons and other machines that would accelerate charged particles to higher energies. The late Maurice Goldhaber, former director of Brookhaven Laboratory, once reminisced:
The first to disintegrate a nucleus was Rutherford, and there is a picture of him holding the apparatus in his lap. I then always remember the later picture when one of the famous cyclotrons was built at Berkeley, and all of the people were sitting in the lap of the cyclotron.
“Bankers must now surrender more information on their activities. Scientists should use it to build better system-wide financial models.” - John Liechty director of the Center for the Study of Global Financial Stability and Professor of Marketing and Statistics at Pennsylvania State University in University Park.
The financial system is in a credit-confidence trap. Like a badly balanced ship trying not to capsize during a storm, banks and financiers are unwilling to make loans or accept collateral in exchange for securing debts — they fear being overwhelmed by the next wave of crisis. Even though the first sovereign default, in Greece, has passed, there is no obvious port in this storm.
How did the system get so far out of balance? And how can scientists — accustomed to modelling complex events to explain and make predictions — help to create a financial system that is more self-stabilizing? Existing financial models failed to predict the crisis of 2008 and the follow-on crisis of 2011-12. They missed the huge system-wide risks that developed as banks promoted an undisciplined supply of mortgages and created an increasingly complex web of relationships through legal contracts that transferred risk throughout the financial markets.
Financial bonds based on these mortgages (and other assets) were seen as risk-free and cheap, and banks used them as both capital and collateral. But when house prices plummeted, the bonds were useless for securing even short-term loans for the banks, which suddenly faced cash shortages. The banks held assets that were potentially worthless, and they were all interconnected. If one firm went down, everyone else was vulnerable.
Market forces function only if all risks are fairly priced. The system-wide risks that these bonds held were not taken into account, so the bonds were sold too cheaply. A clear scientific goal, therefore, is to build better system-wide models of the global financial system. Both the industry and regulators could use such models to judge financial risk and make decisions.
True, scientists are not blameless with regard to the recent collapse. They helped to create the models that the banks routinely used to measure risk. But those models lacked crucial data — on common holdings and trading behaviours, for instance, and on the interconnections between firms and the capacity of markets to execute trades.
For commercial reasons, banks have historically been reluctant to share this kind of information, but that is changing. Legislation in the United States now allows regulators to collect such data from banks, pension funds, insurance companies and other big players in the financial markets. Regulators in Europe are following suit, and hopefully Asia will as well. As a result, we will soon be able to model and identify potential system-wide risks.
To get an idea of the challenge of modelling system-wide financial risk, consider an indoor shopping mall that charges people to enter and exit. To model the movement of shoppers, we could build a purely statistical model of the door traffic, and in most situations this would be sufficient. However, in extreme situations, such as a fire, the system would change dramatically. Shoppers would rush for the nearest exits and ticket-takers would get overwhelmed and close their doors. Then shoppers would rush to the next set of doors. In such cases, a statistical model would get it horribly wrong.
Equilibrium or structural models of the same system would track and predict the motives — and, therefore, the movement — of each individual. In normal times, these models are too complex and hard to calibrate — imagine trying to quantify all of the reasons that people go shopping. But in times of distress, as the shoppers’ motives and behaviour converge (get out!), the model output improves.
To fully understand and predict the dynamics of a market in crisis, we have to understand the capacity of the market-makers (the ticket-takers at the door of the shopping mall) and the demand for assets when prices lurch significantly away from present levels (the number of shoppers trying to get out versus the number trying to get in). The new data will allow models to do this for the first time.
Clearly, regulators have a responsibility to build such models and to use them to monitor for potential crisis. To do this, they will need to leverage expertise among scientists by supporting and encouraging research in universities and labs, and by hosting the more applied work to maintain confidentiality. Bankers should join this effort too, if only to avoid forcing regulators to use crude tools to set prices on these risks — through capital ratios or transaction taxes, for example.
Bankers should work in parallel and form an industry group that collects system-wide data from its members, organizes resources for scientists to develop the necessary models, and creates a secure and confidential infrastructure for members to determine the price of system-wide risks. The industry already has a group that does something similar — the international Operational Riskdata eXchange Association, which shares operational-loss data among member firms.
Everyone would benefit if bankers were to engage with scientists to build the infrastructure needed to price system-wide risk. Banks could get feedback about common holdings and trading strategies, which would allow them to adjust their behaviour and avoid following the herd. Regulators would have extra market information to help them to determine when to act to ensure stability. And the rest of us could have increased confidence in the financial system.