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Feb 09 2011

Evening Edition

Evening Edition is an Open Thread

Now with 56 Top Stories.

From Yahoo News Top Stories

1 Egypt regime warns of crackdown as revolt spreads

by Sara Hussein, AFP

1 hr 14 mins ago

CAIRO (AFP) – Egypt’s embattled regime warned of a military crackdown on Wednesday as massive protests demanding its overthrow spilled out across the country and deadly unrest flared in the remote south.

Hundreds of demonstrators marched on parliament from the epicentre of the uprising in Cairo’s Tahrir Square the day after the largest protests since the revolt began, as other demonstrations erupted in cities across the country.

Foreign Minister Ahmed Abul Gheit warned the army, until now a respected and mostly neutral force on Cairo’s streets, would intervene to protect the country if the protests against President Hosni Mubarak escalated.

2 Egypt protests mount despite regime threats

by Sara Hussein, AFP

Wed Feb 9, 12:57 pm ET

CAIRO (AFP) – Egyptian protesters defied warnings from Hosni Mubarak’s regime that their campaign could plunge Egypt into chaos and marched on parliament Wednesday, amid reports of deadly violence in the remote south.

Around a thousand marched on parliament to demand its members’ resignation. The protest was peaceful, and government troops secured the building, but the marchers swore they would not leave until the legislature was dissolved.

The night before they had been joined by several hundred thousand supporters for the biggest night of rallies yet in the two-week-old drive to topple their autocratic president and replace his 30-year-old regime.

3 Egypt protests mount as US presses Mubarak

by Joseph Krauss, AFP

Wed Feb 9, 10:17 am ET

CAIRO (AFP) – Galvanised by the biggest day of protest since their campaign to oust Hosni Mubarak’s regime began, Egyptian pro-democracy campaigners attempted to blockade parliament Wednesday.

As speakers blared “Do not be tired. Do not be tired. Freedom isn’t free,” thousands of protesters remained camped under plastic sheets and the tracks of tanks, clinging to their “liberated” enclave on Cairo’s Tahrir Square.

Around a thousand marched on parliament to demand its member’s resignation. The protest was peaceful, and government troops secured the building, but the marchers swore they would not leave until the body was dissolved.

4 Magistrates seek immediate trial for Berlusconi

by Mathieu Gorse, AFP

Wed Feb 9, 12:40 pm ET

MILAN (AFP) – Italian prosecutors Wednesday requested that Prime Minister Silvio Berlusconi be put on trial immediately for abuse of power and having sex with an underage girl nicknamed Ruby the Heartstealer.

Berlusconi reacted by calling the request a “farce,” condemning his accusers for acting “subversively” and dismissing their case as a pretext by a politically-biased judiciary to smear him in the media and eventually oust him.

Chief prosecutor Edmondo Bruti Liberati and his fellow judges allege that the 74-year-old leader paid for sex with nightclub dancer Ruby, who was 17 at the time, and improperly used his power as prime minister by asking police to release her after she had been arrested for suspected theft in May.

5 Sarkozy tells cabinet to holiday in France

by Roland Lloyd Parry, AFP

Wed Feb 9, 9:01 am ET

PARIS (AFP) – French President Nicolas Sarkozy has ordered his ministers to stay in France on holiday to avoid diplomatic gaffes after scandals over hospitality from authoritarian North African leaders.

Sarkozy bowed to criticism from rivals after embarrassing revelations that his prime minister and foreign minister accepted free holiday flights in Egypt and Tunisia, shortly before popular uprisings in both countries.

“From now on, members of the government must prefer France for their holidays,” President Nicolas Sarkozy told a cabinet meeting, according to a transcript released by his office.

6 South Sudan minister shot dead in Juba

by Peter Martell, AFP

Wed Feb 9, 12:06 pm ET

JUBA, Sudan (AFP) – A south Sudanese minister, Jimmy Lemi Milla, and his bodyguard were shot dead in Juba on Wednesday in a revenge killing by the minister’s brother-in-law, southern officials said.

“There was shooting at the ministries (complex) in which the minister of cooperatives and rural development was killed as well as his bodyguard,” Sudan People’s Liberation Army (SPLA) spokesman Philip Aguer told AFP.

South Sudan’s president Salva Kiir announced a three-day mourning period, in a statement issued by his office.

7 Fed’s Bernanke tackles congressional critics

by Andrew Beatty, AFP

34 mins ago

WASHINGTON (AFP) – Federal Reserve chairman Ben Bernanke fended off criticism that he is ignoring the risk of rising prices Wednesday, as he faced a hostile Republican-controlled panel in Congress.

“We remain unwaveringly committed to price stability,” Bernanke told the House of Representatives budget committee, rejecting claims that rising prices for food and oil heralded dangerously speeding inflation.

Bernanke — who was appointed by Republican president George W. Bush — sparred with the committee’s Republican members, who warned of the risks from pumping hundreds of billions of dollars into the economy to prop up growth and help reduce unemployment.

8 Nokia ‘on a burning platform,’ CEO warns

by Aira-Katariina Vehaskari, AFP

Wed Feb 9, 12:16 pm ET

HELSINKI (AFP) – The world’s top mobile phone maker Nokia is “standing on a burning platform” surrounded by a “blazing fire” of competition, new company head Stephen Elop says in a dramatic call for radical change.

In an internal memo obtained by AFP Wednesday, Elop’s memo paints a picture of a desperate man who must make the drastic move of plunging into icy waters in order to save himself.

The company must now make a similar radical choice, he warned.

9 Taiwan detains general in China spy case

by Benjamin Yeh, AFP

Wed Feb 9, 12:12 pm ET

TAIPEI (AFP) – A Taiwanese general has been arrested over claims he spied for China, the defence ministry said Wednesday as it scrambled to limit the damage from what it called the worst espionage case in 50 years.

Army Major General Lo Hsien-che was recruited by China while stationed in Thailand between 2002 and 2005 and was detained late last month, the ministry said in a statement.

At the time of his arrest, the 51-year-old was head of the army’s telecommunications and electronic information department, according to the statement.

10 Pakistan cabinet resigns

by Nasir Jaffry, AFP

Wed Feb 9, 7:07 am ET

ISLAMABAD (AFP) – Pakistan’s ministers on Wednesday submitted their resignations to the prime minister as part of plans to appoint a smaller cabinet in order to reduce government spending at a time of economic crisis.

Still reeling from unprecedented flooding last year that caused damages of $9.7 billion, the government is under huge pressure to introduce economic reforms and meet IMF targets agreed in a 2008 bail-out package.

“Today’s meeting is going to be the last meeting of the present cabinet,” Prime Minister Yousuf Raza Gilani told more than 50 ministers, praising their record on the economy, constitutional reform and response to major floods.

11 London, Toronto stock exchanges unveil merger

by Roland Jackson, AFP

Wed Feb 9, 5:38 am ET

LONDON (AFP) – The London and Toronto stock exchanges announced a landmark merger on Wednesday to create a one of the world’s biggest trading platforms that will dominate raw materials and energy.

“London Stock Exchange Group plc and TMX Group Inc. today announced an agreement to combine Europe’s and Canada’s leading diversified exchange groups in an all-share merger of equals,” the pair said in a joint statement.

“The merger will create a world-leading organisation and is unanimously being recommended by the boards of both LSE and TMX.”

12 Sumo grand champion apologises over scandal

by Harumi Ozawa, AFP

Wed Feb 9, 5:29 am ET

TOKYO (AFP) – Japan’s sumo grand champion apologised on Wednesday for a match-fixing scandal that has led to the cancellation of a tournament and is set to cause millions of dollars in losses.

“This (scandal) has put a big hole in my heart,” said Hakuho, the Mongolian-born yokozuna or grand champion, a day after a panel widened its probe to all 70 wrestlers in the top two divisions of the ancient sport.

“The only thing I can do now is to work hard so that I can show you good sumo fights again,” said the 25-year-old grappler in his first press conference since the scandal broke last week.

13 Bernanke says job growth, inflation still too low

By Pedro da Costa and Mark Felsenthal, Reuters

2 hrs 7 mins ago

WASHINGTON (Reuters) – Federal Reserve Chairman Ben Bernanke on Wednesday suggested U.S. economic conditions are still too weak for the central bank to pull back on its vast monetary stimulus, despite a welcome drop in the jobless rate.

The Fed chief, testifying to the House of Representatives Budget Committee, also warned about the dangers of record U.S. budget deficits. But he indicated sharp spending cuts in the short term could cripple the recovery.

Acknowledging a recent pick-up in the economy, Bernanke said a drop in the jobless rate to 9 percent in January from 9.8 percent in November, the biggest two-month decline since 1958, was “grounds for optimism.”

14 Deutsche Boerse, NYSE in talks as merger frenzy grips

By Jonathan Spicer and Edward Taylor, Reuters

31 mins ago

NEW YORK/FRANKFURT (Reuters) – Deutsche Boerse is in advanced talks to buy NYSE Euronext in a deal that would create the world’s largest trading powerhouse and put the citadel of American capitalism into foreign hands.

The discussions announced on Wednesday are part of a massive shake-up of an industry under intense cost pressure from upstart electronic rivals, but also sees new business opportunities as derivatives are forced onto exchanges.

Only hours earlier, the London Stock Exchange’s agreed to buy Canadian stock market operator TMX, a move that would make it the fourth largest exchange and give it dominance in the fast-growing mining and energy sectors.

15 LSE to buy Toronto bourse making $4 trillion exchange

By Luke Jeffs and Paul Hoskins, Reuters

Wed Feb 9, 7:28 am ET

LONDON (Reuters) – The London Stock Exchange is to buy Canada’s TMX to claw back lost market share and create the world’s fourth-largest bourse trading $4.1 trillion of stock a year.

Shares in the LSE, first established in 1698, jumped 9 percent as markets welcomed the all-share deal, and indicating a per share valuation for TMX of C$46.7, up 16 percent.

The deal would create the No. 1 global center of mining and energy stock trading and values the Toronto group at about $3.2 billion.

16 JPMorgan fires back in $6.4 billion Madoff lawsuit

By Jonathan Stempel, Reuters

2 hrs 16 mins ago

NEW YORK (Reuters) – JPMorgan Chase & Co accused the trustee seeking $6.4 billion for victims of Bernard Madoff’s Ponzi scheme of doing an end run around the law in pursuing his case, and said it has a right to a jury trial.

The second-largest U.S. bank said court-appointed trustee Irving Picard is exceeding his authority by suing in bankruptcy court, where a judge rather than a jury would decide the case.

It said the case instead belongs in district court, because it involves “significant” banking and securities law issues.

17 Ex-SAC Capital employees charged in trading probe

By Matthew Goldstein and Grant McCool, Reuters

Tue Feb 8, 10:02 pm ET

NEW YORK (Reuters) – Two people who once worked for billionaire trader Steven A. Cohen’s SAC Capital Advisers were charged with insider trading, drawing the $12 billion hedge fund firm further into a high-profile investigation.

Prosecutors on Tuesday accused the two former employees, among four new defendants charged with insider trading, with receiving corporate secrets while working at SAC. The firm itself has not been charged with any wrongdoing.

The government has been investigating current and former SAC employees, sources have told Reuters, since prosecutors announced a huge insider trading case involving Galleon Group hedge fund founder Raj Rajaratnam in October 2009.

18 SEC gives credit ratings the cold shoulder

By Sarah N. Lynch, Reuters

7 mins ago

WASHINGTON (Reuters) – U.S. securities regulators moved to scale back market reliance on credit rating agencies, after the financial crisis laid bare the industry’s shortcomings.

The Securities and Exchange Commission voted 5-0 on Wednesday to propose that several of its key documents for securities offerings no longer require ratings references that were designed to help investors gauge the quality of securities.

The SEC’s action on Wednesday is the start of a broader effort mandated by the Dodd-Frank financial reform law to strip ratings references from all federal agencies’ rules, as appropriate.

19 Lawmakers pound public pensions, fear bailouts

By Lisa Lambert, Reuters

Wed Feb 9, 1:48 pm ET

WASHINGTON (Reuters) – A top Republican lawmaker swore off any bailout of U.S. state and city governments on Wednesday, turning up the heat on states to fix chronically underfunded pensions and persistent budget problems.

“Reckless spending fueled by bottomless borrowing and guaranteed by endless bailouts is an unsustainable course,” said Representative Patrick McHenry, chairman of a House of Representatives subcommittee on bailout oversight.

“The era of the bailout is over,” he said at a hearing about states’ fiscal distress.

20 White House proposes unemployment aid for states

By Jeff Mason and Lisa Lambert, Reuters

Tue Feb 8, 6:24 pm ET

WASHINGTON (Reuters) – President Barack Obama will propose giving financial relief to U.S. states struggling with high unemployment insurance debt, the White House said on Tuesday, hoping that a lifeline now will avoid bailouts later.

Many states have had to borrow from the federal government to meet rising demand for unemployment payments as the ranks of the jobless grew during the recession that began in 2007.

Now, 30 states are in debt, having borrowed $42 billion to pay their unemployment insurance obligations.

21 No budget Armageddon in Texas: Governor Perry

By Corrie MacLaggan, Reuters

Tue Feb 8, 6:05 pm ET

AUSTIN, Texas (Reuters) – Texas does not face a fiscal meltdown and its economy remains strong, Governor Rick Perry said on Tuesday in the face of a massive state budget shortfall.

Texas, the second most populous state behind California, is about $27 billion short of the money it needs to extend current programs and services through 2012 and 2013. The state has a two-year budget cycle.

Texas has been doing better financially than most other big U.S. states including California, New York and Illinois. Two of the three major bond ratings agencies give it a top AAA rating.

22 AIG to take $4.1 billion fourth-quarter charge

By Elinor Comlay, Reuters

Wed Feb 9, 11:34 am ET

NEW YORK (Reuters) – Bailed-out insurer American International Group Inc said it would take a $4.1 billion charge at its Chartis unit after a review showed higher-than-expected claims on older policies for asbestos exposure and workers’ compensation.

In a further bid to bolster capital at the unit, the U.S. government will allow AIG to retain $2 billion from recent sales.

Under Chief Executive Robert Benmosche, AIG had been selling businesses such as its AIG Star Life Insurance Co and AIG Edison Life Insurance Co to refocus on core units including global property insurer Chartis and U.S. life insurer SunAmerica.

23 Special report: Extreme weather batters the insurance industry

By Ben Berkowitz, Reuters

Wed Feb 9, 9:19 am ET

NEW YORK (Reuters) – In Chester County, South Carolina, off a dirt road in the middle of a field, insurance companies are literally unleashing a storm.

To simulate hurricane-like conditions, an industry group has built a wind tunnel big enough to accommodate nine large residential homes. Some 105 fans deliver gusts of 175 miles per hour, destroying dwellings built precisely for this purpose.

The goal is to construct homes across the country that can withstand the worst Mother Nature has to offer, which lately has been quite a lot — not to mention tough if not impossible for insurers to predict.

24 Sanofi says Genzyme takeover talks progressing

By Caroline Jacobs and Noelle Mennella, Reuters

Wed Feb 9, 7:17 am ET

PARIS (Reuters) – Sanofi-Aventis reported progress in talks to buy U.S. biotech Genzyme and predicted 5-10 percent lower earnings in 2011, underscoring the French drugmaker’s need to find new sources of revenue growth.

Shares in the company fell 1.6 percent as Chief Executive Chris Viehbacher gave very little away about talks to complete a takeover deal expected to be worth approximately $20 billion, designed to rejuvenate the company’s product line.

“As we announced about 10 days ago, we have signed a confidentiality agreement with Genzyme,” Viehbacher said in a media conference call on Wednesday.

25 Indonesia to boost rice stocks, highlights global food fears

By Neil Chatterjee, Reuters

Wed Feb 9, 6:28 am ET

JAKARTA (Reuters) – Indonesia ordered hefty rice imports on Wednesday to boost stocks by a third in the latest sign that governments concerned about rising food prices and dwindling supplies are rushing into the market and could drive inflation even higher.

Global food prices have climbed to record highs in recent months on shrinking supplies of wheat, corn, soybean and oilseeds, and while rice has been less of a worry thanks to ample supplies in the top two exporters, Thailand and Vietnam, traders said other Asian governments may soon seek to boost rice stocks too.

Adding to a sense of gathering nervousness among governments over food supplies, China plans subsidies to boost grain output this year, state radio said in a report on its website.

26 India arrests first company executive in graft scandal

By Devidutta Tripathy and Alistair Scrutton

Wed Feb 9, 7:45 am ET

NEW DELHI (Reuters) – Indian police have made the first arrest of a company executive in a multi-billion dollar telecoms corruption scandal that has rocked the Congress party-led government and undermined Prime Minister Manmohan Singh.

The scandal, one of several during the Congress party’s second term, has not yet threatened the survival of the coalition because it holds enough seats in parliament, and Singh is still seen as one of the few politicians skilled enough to hold the government together.

But it has already led to the arrest of the former telecoms minister and the opposition, led by the Hindu nationalist Bharatiya Janata Party, is going after the prime minister, accusing him of allowing graft to go unchallenged.

27 China raises rates to battle stubbornly high inflation

By Aileen Wang and Ben Blanchard, Reuters

Wed Feb 9, 6:37 am ET

BEIJING (Reuters) – China raised interest rates on Tuesday for the second time in just over six weeks, intensifying a battle in the fast-expanding economy against stubbornly high inflation that threatens to unsettle global markets.

The timing was a surprise, coming on the final day of China’s Lunar New Year holiday, but investors have long expected more monetary tightening as Beijing struggles to rein in price pressures and ward off a property bubble in an economy that grew at a double-digit pace last year.

Benchmark one-year deposit rates will be lifted by 25 basis points to 3 percent, while one-year lending rates will also be raised by 25 basis points to 6.06 percent, the People’s Bank of China said. The changes go into effect on Wednesday.

28 Toyota shares jump on profit outlook, U.S. probe relief

By Tim Kelly, Reuters

Wed Feb 9, 3:05 am ET

TOKYO (Reuters) – Toyota Motor Corp shares soared on Wednesday after a U.S. government report gave its cars a clean bill of health and a better-than-expected profit outlook helped the world’s largest automaker put a dismal year behind it.

The stock jumped 5.2 percent to a nine-month high, making it the biggest percentage gainer on the Nikkei 225 index.

“The numbers were good. The second thing was the U.S. report which says there are no problems with Toyota electronics. It was a double header,” said Chris Richter an auto analyst with CLSA Asia Pacific Markets in Tokyo.

You may notice a predominance of Business/Economic stories in the Reuters material tonight.  It’s in the source.

29 Strikes in Egypt add to pressure from protests

By MAGGIE MICHAEL and TAREK EL-TABLAWY, Associated Press

1 hr 4 mins ago

CAIRO – Thousands of workers went on strike Wednesday across Egypt, adding a new dimension to the uprising as public rage turned to the vast wealth President Hosni Mubarak’s family reportedly amassed while close to half the country struggled near the poverty line.

Protests calling for Mubarak’s ouster have been spreading since Tuesday outside of Cairo’s Tahrir Square, where demonstrators have been concentrated for the past two weeks. On Wednesday, protesters also gathered at parliament, the Cabinet and the Health Ministry buildings, all a few blocks from the square, and blocked Prime Minister Ahmed Shafiq from his office.

Strikes erupted in a breadth of sectors – among railway and bus workers, state electricity staff and service technicians at the Suez Canal, in factories manufacturing textiles, steel and beverages and at least one hospital.

30 Egypt protesters fear revenge if Mubarak holds on

By DIAA HADID and HADEEL AL-SHALCHI, Associated Press

Wed Feb 9, 9:12 am ET

CAIRO – The trappings of a determined protest movement – chanting, flags and raised fists – fill Tahrir Square, the hard-won enclave of those who seek a new Egypt. But some there fear an enemy in their midst.

After the initial euphoria over their defiance of a state once thought impregnable, protesters are increasingly uneasy that President Hosni Mubarak or leaders he has chosen may hang on to power.

If they do, there is a growing fear that the entrenched regime will try to exact revenge in the way it has done so many times before – mass arrests and abuse of detainees.

31 White House: Basic citizen demands unmet by Egypt

By BEN FELLER and MATTHEW LEE, Associated Press

2 mins ago

WASHINGTON – The White House on Wednesday warned Egypt’s leaders to expect unrelenting protests unless they start to show real reforms and a transition to a freer society, dismissing governmental concessions so far as not having met even the minimum threshold of what people want.

Obama administration officials were also increasingly blunt in describing the limits of their leverage, reasserting that the United States is not seeking to dictate events in Egypt – and that it cannot.

“We’re not going to be able to force them do anything,” White House spokesman Robert Gibbs told reporters.

32 Experts reject calls for US to cut aid to Egypt

By DONNA CASSATA, Associated Press

2 hrs 42 mins ago

WASHINGTON – The United States should use its billions in aid to Egypt as leverage to force a transition to democracy, foreign policy experts told lawmakers Wednesday in Congress’ first hearing since massive anti-government demonstrations for the ouster of President Hosni Mubarak.

The Obama administration and Congress have struggled with the vexing problem of how to embrace a powerful democratic movement while dealing with longtime ally Mubarak, who clings to power despite the clamor for him to step down. Lawmakers have played a limited role in a foreign policy crisis that has gripped the White House and State Department for weeks, offering statements but largely deferring to the administration.

Deciding on whether to give U.S. taxpayer dollars to Egypt is the exception; Congress will decide.

33 Challenging Obama, House GOP calls for deep cuts

By DAVID ESPO and ANDREW TAYLOR, Associated Press

1 hr 29 mins ago

WASHINGTON – Eager to take a quick, $35 billion bite out of government, House Republicans called for termination of at least 60 federal programs Wednesday and cuts in hundreds of others, targeting education and the environment, food safety and law enforcement.

In a blunt challenge to President Barack Obama, the plan calls for eliminating a high-speed rail program the administration has ticketed for a multibillion-dollar expansion. It also recommends ending federal support for the Corporation for Public Broadcasting, family planning services and AmeriCorps.

The government’s principal nutrition program for pregnant women would be cut 6 percent below last year’s level.

34 PROMISES, PROMISES: ‘Widows’ tax’ lingers

By KIMBERLY HEFLING, Associated Press

Wed Feb 9, 3:36 pm ET

WASHINGTON – Tens of thousands of the nation’s war widows find it perplexing and downright disrespectful to their late military husbands: In order to fully collect on insurance their husbands bought for them when alive, they must marry another man.

And to qualify, the widows must remarry when they are 57 or older. Those who remarry earlier miss out, as do widows who never remarry.

At the heart of the issue is a government policy known as the “widows’ tax.” It says a military spouse whose loved one dies from a service-related cause can’t collect both survivor’s benefits and the full annuity benefits from insurance the couple bought from the Defense Department at retirement. Instead, the amount of the annuity payment is reduced by the amount of the monthly survivor benefit.

35 Strokes are rising fast among young, middle-aged

By MARILYNN MARCHIONE, AP Medical Writer

41 mins ago

LOS ANGELES – Strokes are rising dramatically among young and middle-aged Americans while dropping in older people, a sign that the obesity epidemic may be starting to shift the age burden of the disease.

The numbers, reported Wednesday at an American Stroke Association conference, come from the first large nationwide study of stroke hospitalizations by age. Government researchers compared hospitalizations in 1994 and 1995 with ones in 2006 and 2007.

The sharpest increase – 51 percent – was among men 15 through 34. Strokes rose among women in this age group, too, but not as fast – 17 percent.

36 Conservatives’ clout flummoxes House GOP leaders

By CHARLES BABINGTON and LAURIE KELLMAN, Associated Press

34 mins ago

WASHINGTON – The clout of tea party advocates and other hard-line conservatives in Congress has caught top Republicans by surprise, raising questions about whether GOP leaders can impose enough discipline in their House majority to pass tough measures, such as raising the debt ceiling.

Within 24 hours this week, House Speaker John Boehner’s team had to pull a trade bill from the chamber floor, suffered an embarrassing setback on a USA Patriot Act vote, and failed to recoup money paid to the United Nations.

And in electoral politics, the tea party’s threat to Republican incumbents came more into focus. Three GOP senators up for re-election in 2012 could be looking at challenges for their party nominations. One of them, five-term Sen. Orrin Hatch of Utah, crossed town Tuesday to tell the tea party’s national town hall that he has supported its budget-balancing, smaller-government agenda for decades.

37 Republicans grill Bernanke over inflation threat

By JEANNINE AVERSA, AP Economics Writer

52 mins ago

WASHINGTON – Members of Congress sharply questioned Federal Reserve Chairman Ben Bernanke Wednesday over whether the Fed’s policies are raising the risk of higher inflation in the months ahead.

House Budget Committee Chairman Paul Ryan, R-Wis., said he is concerned that the Fed won’t be able to detect inflation until “the cow is out of the barn” and inflation is already spreading dangerously through the economy.

Bernanke acknowledged that inflation is surging in emerging economies. But he downplayed the risks to the U.S. economy, even as lawmakers expressed concerns about rising gasoline and food prices.

38 Berlusconi: Sex trial aims to discredit my govt

By COLLEEN BARRY and ALESSANDRA RIZZO, Associated Press

Wed Feb 9, 9:14 am ET

MILAN – Italian prosecutors demanded Wednesday that Premier Silvio Berlusconi be put on immediate trial over accusations he paid for sex with a 17-year-old Moroccan girl and used his influence to try to cover it up. The Italian leader blasted the “disgusting” action, saying it aimed to topple his government.

The prosecutors, who filed their request in Milan, are seeking a trial now because they believe there is overwhelming evidence against the 74-year-old leader.

A judge must decide whether to accept the prosecutors’ request and indict Berlusconi, or dismiss it. The decision is expected to be made in the next two weeks.

39 AP IMPACT: At CIA, grave mistakes, then promotions

By ADAM GOLDMAN and MATT APUZZO, Associated Press

Wed Feb 9, 11:39 am ET

WASHINGTON – In December 2003, security forces boarded a bus in Macedonia and snatched a German citizen named Khaled el-Masri. For the next five months, el-Masri was a ghost. Only a select group of CIA officers knew he had been whisked to a secret prison for interrogation in Afghanistan.

But he was the wrong guy.

A hard-charging CIA analyst had pushed the agency into one of the biggest diplomatic embarrassments of the U.S. war on terrorism. Yet despite recommendations by an internal review, the analyst was never punished. In fact, she has risen to one of the premier jobs in the CIA’s Counterterrorism Center, helping lead President Barack Obama’s efforts to disrupt al-Qaida.

40 House rejects extensions of Patriot Act provisions

By JIM ABRAMS, Associated Press Writer

Wed Feb 9, 8:07 am ET

WASHINGTON – The House on Tuesday failed to extend the life of three surveillance tools that are key to the nation’s post-Sept. 11 anti-terror law, a slipup for the new Republican leadership that miscalculated the level of opposition.

The House voted 277-148 to keep the three provisions of the USA Patriot Act on the books until Dec. 8. But Republicans brought up the bill under a special expedited procedure requiring a two-thirds majority, and the vote was seven short of reaching that level.

The Republicans, who took over the House last month, lost 26 of their own members, adding to the 122 Democrats who voted against it. Supporters say the three measures are vital to preventing another terrorist attack, but critics say they infringe on civil liberties. They appealed to the antipathy that newer and more conservative Republicans hold for big government invasions of individual privacy.

41 White House says no to emergency AK-47 regulation

By MARTHA MENDOZA, AP National Writer

24 mins ago

The U.S. agency that monitors gun sales has suffered a setback in its effort to increase scrutiny of the bulk sale of high-powered assault rifles in border state gun shops that are a chief source of weapons smuggling into Mexico.

The Bureau of Alcohol, Tobacco, Firearms and Explosives wants to require gun dealers in California, Arizona, New Mexico and Texas to report the sales of two or more rifles to the same customer within a five-day period, similar to a rule that exists for handgun sales. The goal of the plan is to crack down on problem gun dealers and buyers at a time of heightened drug cartel violence along the border.

The agency asked the White House for an emergency order that would allow ATF to quickly impose the requirement without public review. But the White House denied the request and told the agency that the proposal has to undergo a standard three-month review period that is open to public comment.

42 Developer: Ex-Pa. judges extorted $590K in scheme

Associated Press

30 mins ago

SCRANTON, Pa. – As the developer and co-owner of a juvenile detention facility called PA Child Care, Robert Powell owed a debt of gratitude to a pair of northeastern Pennsylvania judges who helped get him in business.

But the judges didn’t want Powell to say thank you. They wanted his cash.

Powell says he fell victim to an extortion scheme by former Luzerne County Judges Michael Conahan and Mark Ciavarella, telling jurors at Ciavarella’s federal racketeering trial Wednesday that he was forced to pay them nearly $600,000 after they agreed to send the county’s juvenile delinquents to his new private lockup outside Wilkes-Barre.

43 Calif. governor drops plan to sell state buildings

Associated Press

35 mins ago

SACRAMENTO, Calif. – California Gov. Jerry Brown announced Wednesday he is dropping a plan hatched by former Gov. Arnold Schwarzenegger to sell 24 state government buildings to private investors because the high cost of rent did not make sense for taxpayers.

The state had been in negotiations to sell the properties for $2.3 billion and use the proceeds after paying off construction bonds to help close the state’s general fund budget deficit. Under a deal approved by lawmakers, the state would have continued using the space by entering into a 20-year lease with the new owners.

The Associated Press reported in April that the deal would end up costing the state $5.2 billion in rent over 20 years, likely saddling taxpayers with costs beyond whatever the state would net from the sale. That assessment was confirmed by the nonpartisan Legislative Analyst’s Office, which found the sale shifts taxpayer costs to the future. The state controller and treasurer also opposed the sale.

44 Cuban official testifies in ex-CIA agent’s case

By WILL WEISSERT, Associated Press

40 mins ago

EL PASO, Texas – A Cuban special investigator presented a photo to a Texas courtroom Wednesday showing the blood-stained lobby of a Havana hotel after a bomb exploded in 1997, killing an Italian tourist. His testimony is part of the U.S. government’s attempt to prove an ex-CIA agent planned the attack, then lied about it when he later sought U.S. citizenship.

Lt. Col. Roberto Hernandez Caballero, assigned to the state security division of the powerful Interior Ministry, told the jury he was in charge of a task force that investigated a series of bombings in Havana and the beach resort of Varadero that ran from April to October 1997.

Prosecutors accuse Cuba-born Luis Posada Carriles of lying during citizenship hearings in El Paso about how he sneaked into the U.S. in March 2005, and of failing to acknowledge planning the bombings of Cuban hotels and a top Havana tourist restaurant in 1997.

45 Judge dismisses Air Force Academy prayer lawsuit

Associated Press

59 mins ago

DENVER – A federal judge has dismissed a lawsuit seeking to block a prayer luncheon at the Air Force Academy.

U.S. District Judge Christine Arguello ruled Wednesday in Denver. She says associate professor David Mullin and a watchdog group, the Military Religious Freedom Foundation, didn’t show they had legal standing to bring the suit.

They alleged the event violates the constitutional separation of church and state because it appears to be sponsored by the academy itself, and because Mullin and other faculty members believe they’ll face retribution if they don’t attend, even though it’s officially voluntary.

46 Obama to shine spotlight on web-savvy Mich. town

By JOHN FLESHER, Associated Press

2 hrs 3 mins ago

MARQUETTE, Mich. – A century-old outdoor clothing store ships coats and woolen socks around the nation, while down the block one of the newer companies in town fields inquiries about its miniature video cameras that skiers, mountain bikers and even troops in Afghanistan attach to their helmets to record themselves in action.

They are among small businesses in Michigan’s off-the-beaten-path Upper Peninsula that owe their success to high-speed Internet access, which President Barack Obama considers a potential economic savior for America’s countryside and small towns. Obama will campaign for his coast-to-coast wireless initiative on Thursday during a visit to Marquette, a university and tourism city of 20,000 overlooking Lake Superior that cherishes both its geographical remoteness and technological savvy.

“The Internet is as important as oxygen up here,” said David Ollila, a local entrepreneur who has founded seven companies, including the camera vendor, V.I.O. Inc. His latest venture, Marquette Backcountry Ski, markets a snowshoe-ski hybrid that he invented and sells online from an office in his basement.

47 Political favor could tarnish Schwarzenegger’s rep

Associated Press

2 hrs 5 mins ago

SACRAMENTO, Calif. – Arnold Schwarzenegger’s last-minute decision to grant clemency in a manslaughter case to the son of a key ally has set off a political furor in California and threatened to tarnish the former governor’s legacy as a reformer and big-thinking environmental steward.

Schwarzenegger cut the 16-year manslaughter sentence in half for 21-year-old Esteban Nunez just hours before leaving office last month, despite the fact that he had pleaded guilty months earlier in the stabbing death of a student in 2008. The decision has angered law enforcement and the family of the victim and has led to lawsuits and three proposed pieces of legislation that would take away a governor’s last-minute clemency authority.

Fellow Republicans are among the most enraged by Schwarzenegger’s commutation of the son of former Assembly Speaker Fabian Nunez, the Democrat who helped broker Schwarzenegger’s biggest environmental accomplishments and became a trusted political ally.

48 New drilling method opens vast oil fields in US

By JONATHAN FAHEY, AP Energy Writer

2 hrs 11 mins ago

A new drilling technique is opening up vast fields of previously out-of-reach oil in the western United States, helping reverse a two-decade decline in domestic production of crude.

Companies are investing billions of dollars to get at oil deposits scattered across North Dakota, Colorado, Texas and California. By 2015, oil executives and analysts say, the new fields could yield as much as 2 million barrels of oil a day – more than the entire Gulf of Mexico produces now.

This new drilling is expected to raise U.S. production by at least 20 percent over the next five years. And within 10 years, it could help reduce oil imports by more than half, advancing a goal that has long eluded policymakers.

49 Gay marriage issue resurfaces in flurry of debate

Associated Press

2 hrs 14 mins ago

PROVIDENCE, R.I. – Lawmakers in Rhode Island and Maryland are taking up bills to legalize gay marriage, advocates in New York are making a renewed push, and opponents are fighting for constitutional bans in Indiana and Wyoming and to re-impose bans in Iowa and New Hampshire.

The flurry of activity nationwide has activists on both sides of the gay marriage debate encouraged that 2011 will be a year of gains for them.

“There is so much happening that it is a challenge even for the most ardent marriage-equality supporters to keep track of,” said Molly McKay, media director of Marriage Equality, a national group that favors same-sex marriage. “This is a national fight being fought out on various local grounds. Rhode Island, New York, those are states right now where all eyes are looking.”

50 Lawmakers oppose federal bailout for states

By ALAN FRAM, Associated Press

2 hrs 48 mins ago

WASHINGTON – The new Republican-led House is showing no appetite for making federal taxpayers help state and local governments cope with widespread budget problems. Even some Democrats are wary, underscoring the impact of Washington’s crushing budget deficits.

“The era of the bailout is over,” Rep. Patrick McHenry, R-N.C., told a House hearing on the debt problems facing scores of states and municipalities around the country.

At the same hearing, Rep. Mike Quigley, D-Ill., said states need to erase their deficits and face up to their long-term obligations such as pensions for government workers on their own. He also criticized a proposal from some conservatives that Congress pass a law allowing states to reorganize their debts by declaring bankruptcy, an idea that opponents say would send state borrowing costs soaring.

51 2 Minnesotans too many for 2012 presidential race?

By BRIAN BAKST, Associated Press

Wed Feb 9, 4:04 pm ET

ST. PAUL, Minn. – Tim Pawlenty and Michele Bachmann spent the past decade mostly staying out of each other’s way, two Minnesotans taking very different paths on the rise to national Republican Party prominence from a state better known for its Democratic icons.

Their shared flirtation with presidential politics won’t allow that much longer.

Though each appeals to different segments of their party and they are far from alone in the 2012 mix, some doubt a same-state duo can stay viable very long. And it is a recipe for division among Minnesota Republicans left to pick sides, meaning delay for either Pawlenty or Bachmann nailing down critical support back home.

52 Global warming heats up Republican attacks on EPA

By DINA CAPPIELLO, Associated Press

Wed Feb 9, 3:58 pm ET

WASHINGTON – Vowing to curb the authority and the budget of the Environmental Protection Agency, congressional Republicans are attacking the agency to a degree not seen since President Richard Nixon created it 40 years ago.

The EPA’s effort to tackle the latest and perhaps most challenging environmental problem – global warming – has made it a central target of the new Republican leadership’s anti-regulatory agenda. Having failed last year to enact new legislation to curb global warming, the administration is left to use existing law – the Clean Air Act – to start reducing the pollution causing the planet’s temperature to rise.

During a hearing on Wednesday, GOP members of a House subcommittee contended that such actions will only raise electricity prices and penalize industries that otherwise could be creating jobs.

53 Labor board flexes muscle, to chagrin of business

By SAM HANANEL, Associated Press

Wed Feb 9, 3:30 pm ET

WASHINGTON – The agency that enforces the nation’s labor laws has emerged as a key player in the clash between business and organized labor over union rights.

The National Labor Relations Board has been flexing its muscle in recent months by cracking down on businesses that fire employees during union organizing drives and reconsidering some business-friendly decisions made during the George W. Bush administration.

It recently proposed a new rule that would require every private employer to display posters explaining union rights. And last month, it threatened to sue four states over laws that guarantee the right to a secret ballot in union elections.

54 Obama to send South Korea trade deal to Congress

By JIM ABRAMS, Associated Press Writer

Wed Feb 9, 1:10 pm ET

WASHINGTON – President Barak Obama plans to send the U.S.-South Korea free trade agreement to Congress in the next few weeks, but “serious issues” are holding up deals with Colombia and Panama, his top trade official said Wednesday.

U.S. Trade Representative Ron Kirk told the House Ways and Means Committee that Obama hopes Congress will approve the South Korean pact this spring. The administration says that accord could mean billions of dollars in increased U.S. exports and create tens of thousands of jobs.

Kirk failed to satisfy majority Republicans about progress in finalizing the Latin American agreements. He said Obama had directed him to intensify talks with Colombia and Panama, but “there remain serious issues” including labor rights issues, to be resolved before the administration submits the deals to Congress.

55 Kia Optima: 4 cylinders only

By ANN M. JOB, For The Associated Press

Wed Feb 9, 12:30 pm ET

For years, relatively few people knew or cared that Kia was selling a mid-size sedan to compete with the Toyota Camry, Honda Accord and Ford Fusion. But that’s about to change.

The new-for-2011 Optima, featured in a multi-million dollar Super Bowl ad, is handsome and well-powered and longer and wider than its predecessor. It even has better fuel mileage ratings than the non-hybrid versions of Camry, Accord and Fusion.

And the starting retail price for the 2011 Optima undercuts the major competition while, in some cases, including more standard equipment. The Optima also comes standard with longer basic and powertrain warranty coverage – up to 10 years/100,000 miles, whichever comes first – than competitors offer.

56 Chicago officials defend cameras after ACLU report

By SOPHIA TAREEN, Associated Press

Wed Feb 9, 11:06 am ET

CHICAGO – Chicago emergency management officials defended the city’s expansive network of cameras following a scathing report from a leading civil rights group that raised concerns about the loss of privacy, a lack of regulation and fears the technology could violate the First Amendment.

The American Civil Liberties Union of Illinois called for a full review of the system – with at least 10,000 cameras mounted at locations from skyscrapers to utility poles – saying city officials won’t release basic information such as the exact number and cost of the cameras, nor any incidents of misuse.

Those concerns, along with city officials’ plans for expansion, put Chicago a step closer to a Big Brother invasion of privacy, the ACLU said.

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