US THREAT OF MILITARY ACTION UNITES PAKISTAN

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JACK VAN IMPES LATEST SHOWS-VIDEO)
http://wm.thegospel.com/jvi/jvi1139.wmv (SEPT 28,11)
http://wm.thegospel.com/jvi/jvi1138.wmv (SEPT 21,11)
http://wm.thegospel.com/jvi/jvi1137.wmv (SEPT 14,11)
http://wm.thegospel.com/jvi/jvi1136.wmv (SEPT 07,11)
http://wm.thegospel.com/jvi/jvi1135.wmv (AUG 31,11)
http://wm.thegospel.com/jvi/jvi1134.wmv (AUG 24,11)
http://wm.thegospel.com/jvi/jvi1133.wmv (AUG 17,11)
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http://wm.thegospel.com/jvi/jvi1130.wmv (JULY 27,11)
http://wm.thegospel.com/jvi/jvi1129.wmv (JULY 20,11)
http://wm.thegospel.com/jvi/jvi1128.wmv (JULY 13,11)
http://wm.thegospel.com/jvi/jvi1127.wmv (JULY 06,11)
http://wm.thegospel.com/jvi/jvi1126.wmv (JUN 29,11)
http://wm.thegospel.com/jvi/jvi1125.wmv (JUN 22,11)
http://wm.thegospel.com/jvi/jvi1124.wmv (JUN 15,11)
http://wm.thegospel.com/jvi/jvi1123.wmv (JUN 08,11)

http://www.infowars.com/pentagon-developing-drones-to-spot-adversarial-intent/

DOCTOR DOCTORIAN FROM ANGEL OF GOD
then the angel said, Financial crisis will come to Asia. I will shake the world.

JAMES 5:1-3
1 Go to now, ye rich men, weep and howl for your miseries that shall come upon you.
2 Your riches are corrupted, and your garments are motheaten.
3 Your gold and silver is cankered; and the rust of them shall be a witness against you, and shall eat your flesh as it were fire. Ye have heaped treasure together for the last days.

REVELATION 18:10,17,19
10 Standing afar off for the fear of her torment, saying, Alas, alas that great city Babylon, that mighty city! for in one hour is thy judgment come.
17 For in one hour so great riches is come to nought. And every shipmaster, and all the company in ships, and sailors, and as many as trade by sea, stood afar off,
19 And they cast dust on their heads, and cried, weeping and wailing, saying, Alas, alas that great city, wherein were made rich all that had ships in the sea by reason of her costliness! for in one hour is she made desolate.

EZEKIEL 7:19
19 They shall cast their silver in the streets, and their gold shall be removed: their silver and their gold shall not be able to deliver them in the day of the wrath of the LORD: they shall not satisfy their souls, neither fill their bowels: because it is the stumblingblock of their iniquity.

REVELATION 13:16-18
16 And he(FALSE POPE) causeth all,(WORLD SOCIALISM) both small and great, rich and poor, free and bond, to receive a mark in their right hand, or in their foreheads:(CHIP IMPLANT)
17 And that no man might buy or sell, save he that had the mark, or the name of the beast, or the number of his name.
18 Here is wisdom. Let him that hath understanding count the number of the beast: for it is the number of a man; and his number is Six hundred threescore and six.(6-6-6) A NUMBER SYSTEM

WORLD MARKET RESULTS
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HALF HOUR DOW RESULTS FRI SEPTEMBER 30,2011

09:30 AM -3.43
10:00 AM -112.61
10:30 AM -55.70
11:00 AM -110.16
11:30 AM -71.67
12:00 PM -50.89
12:30 PM -60.51
01:00 PM -106.07
01:30 PM -94.07
02:00 PM -84.54
02:30 PM -155.64
03:00 PM -172.43
03:30 PM -172.29
04:00 PM -240.60 10,913.38

S&P 500 1131.42 -28.98

NASDAQ 2415.40 -65.36

GOLD 1,620.50 +3.20

OIL 79.01 -3.15

TSE 300 11,623.80 -62.50

CDNX 1467.17 -15.05

S&P/TSX/60 667.08 -3.56

MORNING,NEWS,STATS

YEAR TO DATE PERFORMANCE
Dow -117 points at 4 minutes of trading today.
Dow -120 points at low today.
Dow -1 points at high today so far.
GOLD opens at $1,618.20.OIL opens at $80.54 today.

AFTERNOON,NEWS,STATS
Dow -120 points at low today so far.
Dow -1 points at high today so far.

WRAPUP,NEWS,STATS
Dow -240 points at low today.
Dow -1 points at high today.

GOLD ALLTIME HIGH $1,902.60 (NOT AT CLOSE)

Ya’alon: No Negotiations with this PA Leadership-Vice Prime Minister Moshe Ya’alon in a Rosh Hashanah interview: Facing this PA leadership there are no prospects for peace.By Elad Benari, Canada First Publish: 9/29/2011, 12:04 AM

Israel’s Vice Prime Minister and Minister of Strategic Affairs, Moshe Ya’alon, gave a special interview to Arutz Sheva on Wednesday for Rosh Hashanah. During the interview Ya’alon summed up last week’s events in the United Nations and said that Israel should not conduct negotiations with the Palestinian Authority as long as its current leadership remains the same.Arutz Sheva: One can summarize the events at the UN and say that you are quite satisfied with Netanyahu’s speech.Ya’alon: We’re satisfied not just with Netanyahu’s speech but also by the Palestinians’ failure to make their unilateral move. The Palestinians have been consistently avoiding negotiations since the dawn of Zionism. It was seen in Arafat’s response to Barak’s offer in 2000, it was seen when Abbas avoided Olmert’s offer in 2008, and now Abbas is avoiding negotiations by going to the United Nations unilaterally. We are also satisfied by the fact that all these threats and scenarios of a tsunami, international isolation and an intifada did not come true, and the move appears to be a failure.Is it indeed a failure? They are going to the Security Council and promoting it there. We’re relying on an American veto. It’s not exactly a failure.

Unfortunately in the United Nations, with us being the only Jewish state alongside 22 Arab countries and more than 50 Muslim countries, there is no place to look for justice, and yet the Palestinians have no majority in the Security Council to pass their application. There is an important American stance here which is going to veto, a stance which, by the way, was changed due to Israel’s actions, and now the U.S. is in the same position as us, that the unilateral move is unacceptable and will bring about a second Hamastan. We need to see Obama’s speech as a significant process of change since he took office.How much will we have to pay politically for this embrace? We already heard Netanyahu saying in the United States that he is willing to talk about freezing construction.We talk about entering negotiations without preconditions and say that we are ready to talk about everything, but the fundamental questions we raised were answered with a resounding no, for example of a future consent, not a condition for beginning negotiations, to recognize Israel as a Jewish nation, and we were told that it will never happen. So what can we talk about? Abbas is asking what will happen with the Arabs of 1948 and what will happen with the right of return. Barak revealed the face of Arafat, Olmert revealed the face of Abbas even though he and Livni claim that the process was stopped because of the elections, which is a lie. With our demand for recognition we exposed Abbas’ true face and we did it without it even costing us a political price.As someone who knows the PA’s internal dialogue very well, do you believe that there is one PA leader who could accept this demand and stay alive?

If that’s the situation then we would be better off not to ignore it or sweep it under the rug. It has been my contention ever since I was head of Military Intelligence in 1995, when I realized that even in Oslo they did not recognize Israel’s right to exist within borders of any kind, and that the entire move was meant to be a Trojan horse that will allow them to enter Palestine. It is good that the people of Israel know this and not fool themselves. One of the worst things that happened to us is that we adopted their narrative and we covered up the fact that never have they had a leadership that was willing to recognize Israel’s right to exist.So this demand for recognition is only to expose their faces? It’s not a real requirement for negotiations? This is a genuine and basic demand, because without it any agreement we sign would be just another stage in the conflict. People ask why we did not demand this from the Egyptians and the Jordanians and the answer is simple: because they have no claim on Sheikh Munis, Haifa, Akko and Ashkelon. In contrast, the Palestinians view Israeli Arabs as being part of them so they are not prepared to see a return to 1949 armistice lines as an end to the conflict.Do you believe that there is some sort of outline of an agreement that ensures the Palestinian state will be demilitarized and that Hamas would not take over it the next day? We’re not there yet, because of their lack of willingness to recognize us. After all, in his speech Abbas denied the connection of the Jews to their land. He spoke only of the Muslim and Christian connection to Israel. He argues that there is no Jewish nation. Does anyone think we can sign an agreement with them when their young generation is brought up according to such perceptions? It appears from what you are saying that you do not really believe there are any prospects to these negotiations.

In this situation facing this leadership there definitely are no prospects, and it’s better that all of us know this. It’s important that an Israeli majority that recognizes reality take shape, without illusions of peace now or disengagement. When we are united, the world opinion will be with us.The left and the world say that the Netanyahu government has a credibility problem. Maybe they’re right, because here you are proving how little chance such negotiations have and yet you’re still talking about the vision of two states.We say that we do not want to rule over them. They have political independence and we are ready to strengthen it in those areas for which they are responsible, but if they do not respect our right to exist, why should we start talking with them about territory? We are ready to have them conduct their lives in their area of autonomy.And given all this, when will the Likud government fulfill its nationalist platform and finally build after so many years in Judea and Samaria? Because of the sensitivity of the situation which we received, of political processes that previous governments conducted, we have been cautious. We had to accept commitments of previous governments, including a commitment not to establish new Jewish communities, but insisted on continuing construction. So there are periods of sensitivity but construction continues and the number of residents in Judea and Samaria is growing.Before the events at the UN there was talk of the possibility of annexing Judea and Samaria as a response to the PA’s move. Is it feasible? There is no doubt that the Palestinians going to the UN is a gross violation of the Oslo Accords. We held discussions about the possibilities that lie in our hands in response to this move. We are considering our options. We will hold discussions with the Prime Minister about both the Quartet’s offer as well as the Palestinian move on and make our decisions.As a member of the ministerial team on Migron, do you know what exactly happened that night of the destruction, and why?

It was clear that the three homes were built without permits. Minister Begin and I were in talks with the residents of the community about some ways to deal with the problem. Unfortunately, we were surprised with a move that was decided by the defense minister. The issue is being clarified among the ministers and the prime minister and the defense minister. I hope that lessons can be learned from that incident, too.Thank you very much.Thank you, and I wish to take this opportunity to wish you and all the people of Israel a Shana Tova, a good new year.(Arutz Sheva’s North American Desk is keeping you updated until the start of Rosh Hashanah in New York. The time posted automatically on all Arutz Sheva articles, however, is Israeli time.)

PA Statehood Bid Submitted to UN Sub-committee-The PA's unilateral statehood bid has been submitted to a 15-member Security Council sub-committee for further debate. By Elad Benari, Canada First Publish: 9/28/2011, 9:14 PM

The Palestinian Authority’s request for statehood at the United Nations moved to the next level on Wednesday, after the UN Security Council unanimously approved to transfer the request to a sub-committee for further examination.According to a report on Israel’s Channel 10 News, the sub-committee will be made up of representatives from the 15 members of the Security Council. It will review the request and submit conclusions in a few weeks’ time.The report noted that the sub-committee will first meet to discuss the bid on Friday, adding that such requests usually take a period of up to 35 days to discuss but that in this case it will likely take longer.Meanwhile, the PLO’s Observer in the United Nations, Riyad Mansour, welcomed the move and expressed hope that the process will be expedited.

We are grateful to the Security Council for promoting our request, Mansour was quoted as saying after the meeting at the UN headquarters in New York.The process is advancing step by step and we hope that the Security Council will bear the responsibilities it faces and approve our request.In contrast, Israel’s Ambassador to the UN, Ron Prosor, said that Israel is once again calling on the PA’s leadership to return to direct negotiations which will discuss all core issues.A real and lasting Palestinian state will not be achieved by the force of external factors, but only through direct negotiations, stressed Prosor.Prosor added that the Israeli government has not yet arrived at a final decision on whether to agree to the timetable for negotiations presented last week by the Middle East Quartet. Earlier on Wednesday it was reported that the Israeli Cabinet is likely to accept the timetable.In any case, Prosor stressed that the plan to build 1,100 new housing units in the Gilo neighborhood of Jerusalem should not be an obstacle to negotiations.Everything on the table, everything is negotiable, but the Palestinians use every excuse to avoid negotiations, he was quoted as saying.(Arutz Sheva’s North American Desk is keeping you updated until the start of Rosh Hashanah in New York. The time posted automatically on all Arutz Sheva articles, however, is Israeli time.)

EARTH WORSHIP

DEUTERONOMY 17:3-4
3 And hath gone and served other gods, and worshipped them, either the sun, or moon, or any of the host of heaven, which I have not commanded;
4 And it be told thee, and thou hast heard of it, and enquired diligently, and, behold, it be true, and the thing certain, that such abomination is wrought in Israel:

ISAIAH 13:9-11
9 Behold, the day of the LORD cometh, cruel both with wrath and fierce anger, to lay the land desolate: and he shall destroy the sinners thereof out of it.
10 For the stars of heaven and the constellations thereof shall not give their light: the sun shall be darkened in his going forth, and the moon shall not cause her light to shine.
11 And I will punish the world for their evil, and the wicked for their iniquity; and I will cause the arrogancy of the proud to cease, and will lay low the haughtiness of the terrible.

2 KINGS 23:5
5 And he put down the idolatrous priests, whom the kings of Judah had ordained to burn incense in the high places in the cities of Judah, and in the places round about Jerusalem; them also that burned incense unto Baal, to the sun, and to the moon, and to the planets, and to all the host of heaven.

Climate change to cost Canada billions: panel
ReutersBy David Ljunggren | Reuters – SEPT 29,11

OTTAWA (Reuters) - Climate change will cause damage in Canada equivalent to around 1 percent of GDP in 2050 as rising temperatures kill off forests, flood low-lying areas and cause more illnesses, an official panel said on Thursday.The National Round Table on the Environment and the Economy said Canada's Conservative government - criticized by green activists for not doing enough to fight global warming - should take measures to mitigate the effects of climate change, which most scientists blame on greenhouse gas emissions.The north of Canada, the world's second largest country, is warming up at a much faster pace than the rest of the Earth.
Climate change presents a growing, long-term economic burden for Canada, said the NRTEE, which the government set up in 1988 to provide advice on environmental issues.

According to the most likely scenario outlined by the panel, the damage done by global warming would be between 0.8 percent and 1 percent of GDP by 2050 and could hit almost 2.5 percent by 2075.The magnitude of costs depends upon a combination of two factors: global emissions growth and Canadian economic and population growth, the panel said.Depending on how fast the world heats up and what actions Ottawa takes, the NRTEE said the damage in 2050 could range from C$21 billion ($20 billion) to C$43 billion a year.The panel recommended several measures to help limit damage from climate change:
* enhance forest fire prevention, control pests, and plant climate-resilient tree species
* prohibit new construction in areas at risk of flooding in coastal areas
* install pollution control technologies to limit ozone formation.

Opposition legislators said the report showed the Conservatives needed to do much more to fight global warming.Our coastal communities, our forestry industry, and the health of Canadians will all suffer unless we take action right now. Yet this out-of-touch government has produced no plan to deal with the impact of climate change, said Laurin Liu of the official opposition New Democrats.Environment Minister Peter Kent responded by saying the report showed the importance of adapting to climate change.Canadians, he told legislators, wanted a strong, stable, environmentally responsible ... government to take care of the environment, and that is exactly what we are doing.The NRTEE said Canada would benefit from a global treaty that systematically reduced carbon emissions beyond 2012, when the first stage of the Kyoto Protocol expires.Canada walked away from Kyoto after the Conservatives took power in 2006 and subsequently adopted a much more modest target for emissions cuts. John Bennett of the Sierra Club mocked Kent by condemning what he said was a stubborn, deaf, environmentally irresponsible, antiquarian government.
The NRTEE largely dismissed the idea that global warming could help a northern country like Canada by reducing heating costs and making it easier to grow certain kinds of crops.(Reporting by David Ljunggren; editing by Peter Galloway)

Flood-ravaged Philippines braces for new typhoon
AFPAFP – SEPT 29,11

The death toll from a typhoon that pummelled the Philippines climbed to 43 as authorities warned another storm was set to strike and endanger nearly a million people enduring horror floods.Typhoon Nesat dumped enormous amounts of rain across the main island of Luzon on Tuesday and huge tracts of farming lands remain under water.The government said nearly a million people had been affected by the flooding, and that another typhoon was forecast to dump more rain across Luzon from Saturday.
Our problem is the floodwaters have yet to be flushed out to sea and rains dumped on nearby mountains are still on their way down to the plains, Science Undersecretary Graciano Yumul said on ABS-CBN television on Friday.Then Nalgae strikes it will suck the wet southwest monsoons into these same areas and any fresh rains are bound to worsen the flooding.The government's National Disaster Risk Reduction and Management Council said the death toll from Nesat had risen to 43, up from 39 late Thursday as disaster reports trickled in from isolated areas.Thirty other people remain missing, mostly poor fishermen who went to sea in small outriggers ahead of Nesat, it said.

EARTHQUAKES

MATTHEW 24:7-8
7 For nation shall rise against nation, and kingdom against kingdom: and there shall be famines, and pestilences, and earthquakes, in divers places.
8 All these are the beginning of sorrows.

MARK 13:8
8 For nation shall rise against nation, and kingdom against kingdom:(ETHNIC GROUP AGAINST ETHNIC GROUP) and there shall be earthquakes in divers places, and there shall be famines and troubles: these are the beginnings of sorrows.

LUKE 21:11
11 And great earthquakes shall be in divers places, and famines, and pestilences; and fearful sights and great signs shall there be from heaven.

Strong quake rocks northeast Japan
AP – SEPT 29,11

TOKYO (AP) — A strong earthquake has rocked northeastern Japan, which is still recovering from the devastating tsunami six months ago.The quake Thursday had a preliminary magnitude of 5.6. There were no immediate reports of damage and no tsunami warning was issued.The earthquake was centered off Fukushima, which was severely hit by the quake and tsunami in March that left more than 21,000 people dead or missing. Fukushima is about 150 miles (240 kilometers) northeast of Tokyo.
The March disaster touched off the worst nuclear crisis since Chernobyl, generating meltdowns, fires and explosions at the Fukushima Dai-ichi nuclear facility.The plant's operator said there were no signs of abnormalities at the plant from the quake on Thursday.

Europe again steps back from brink in debt crisis
ReutersBy Stephen Brown and Madeline Chambers | Reuters – SEPT 29,11

BERLIN (Reuters) - Following a now-familiar script, Europe again averted disaster in its debt crisis when German lawmakers rallied behind Chancellor Angela Merkel to approve a stronger euro zone bailout fund on Thursday.But bigger challenges loom for the euro zone now. Financial markets are already anticipating a likely Greek default and demanding more far-reaching measures to prevent the crisis that began in Athens from spreading far beyond Europe and its banks.The Bundestag (lower house) overwhelmingly approved new powers for the 440-billion-euro EFSF fund to make precautionary loans, help recapitalize banks and buy distressed countries' bonds in the secondary market.Despite a rebellion by 15 backbench Euroskeptics, Merkel won 315 votes from her own center-right coalition, enough to avoid the humiliation of having to rely on the opposition Social Democrats and Greens to pass the plan.The result of the vote is a strong signal for Europe. The broad majority in parliament clearly shows that Germany is committed to the euro and to protecting our currency, said Hermann Groehe, general secretary of her Christian Democratic party.The measure was part of a July 21 agreement by euro zone leaders meant to solve the crisis by providing a second bailout for debt-stricken Greece, partly funded by private sector bondholders, and providing more firepower to prevent contagion engulfing bigger EU economies Spain and Italy.

But that deal failed to stop Italian and Spanish borrowing costs soaring, forcing the European Central Bank to intervene in August to buy their bonds, and may yet unravel in Greece, which has fallen behind again on its deficit reduction targets, pushing it closer to default.There is a growing realization, even among the more reticent, that the July 21 package is yesterday's war, and we need to go further, a senior EU official said, speaking on condition of anonymity.The euro and European shares ticked up and safe-haven German bonds fell after the closely-watched vote in Europe's pivotal power, where public opposition to further bailouts is rife.But analysts said financial markets and outside powers still want a more comprehensive response from European Union policymakers to the debt crisis.U.S. President Barack Obama kept up a drum beat of criticism of the EU's crisis management, saying on Wednesday: "In Europe, we haven't seen them deal with their financial system and banking system as effectively as they need to.EU officials are already working on ways of leveraging up the rescue fund, but kept those legally and politically fraught options under wraps ahead of the German vote to avoid antagonizing waverers in the Bundestag.Underscoring the sensitivity, German Economy Minister Philipp Roesler, leader of the liberal Free Democrats, junior partners in Merkel's coalition, said on a visit to Brussels after the vote that Berlin does not want to leverage the bailout fund.The European Commission welcomed German approval of the EFSF boost and said it was confident the ratification process would be complete throughout the 17-nation currency area by mid-October.Elsewhere in Europe, there was a sense of relief. French President Nicolas Sarkozy telephoned Merkel to congratulate her and invited Greek Prime Minister George Papandreou to talks in Paris on Friday to discuss Greece's precarious debt situation. Papandreou met Merkel in Berlin on Tuesday.Cyprus also back the EFSF's new powers on Thursday, taking the number of states that have approved to 12. Of the remainder only Slovakia's endorsement looks politically tricky.

PAIN IN SPAIN, ITALY

Despite the German vote, developments in Spain and Italy highlighted the stark challenges still facing the euro zone in coping with the sovereign debt crisis.
Spain's ruling Socialists abruptly shelved plans to boost public coffers by selling part of the state lottery for up to 9 billion euros ($12 billion), in the face of tough market conditions, political opposition and banks' funding concerns.The backtracking, a day before book building was supposed to begin on the public offering of 30 percent of Loterias, was a blow a few weeks before a November 20 election, which opinion polls show the center-right People's Party sweeping.Banks involved in the sale, Santander and BBVA, saw the Loterias flotation as a direct rival to their efforts to bolster their capital by enticing Spaniards to withdraw deposits to invest in lottery shares.Italy meanwhile had to pay the highest yield on a 10-year bond since the introduction of the euro in 1999 at an auction on Thursday, the first long-term sale since Standard & Poor's cut the country's sovereign credit rating.Rome's funding costs remain under pressure despite ECB bond-buying and a pick-up in risk appetite due to expectations of a stronger euro rescue fund. Analysts say the government's tentative crisis response has harmed investor confidence.Italy sold 7.86 billion euros of long-term bonds, moving closer to an overall issuance target of 430 billion euros for the year, but the 10-year yield rose to 5.86 percent at the auction, up from 5.22 percent a month ago.That's eye-watering yield levels, said David Schnautz, a rate strategist at Commerzbank.In Athens, senior officials of the troika of European Commission, ECB and International Monetary Fund resumed talks aimed at checking that Greece has met the terms of its bailout program after adopting new austerity measures. The Greek Finance Ministry called the climate positive and creative.The government will run out of money to pay salaries and pensions in October unless it receives the next 8 billion euro installment of emergency loans. It pushed an unpopular new property tax through parliament this week despite public anger.Anti-austerity protesters blocked the entrances to several ministries before the start of the talks.Around 200 finance ministry employees gathered in front of their ministry, shouting: Take your bailout and leave.The occupations are carried out today when the troika returns to our country and as we face new barbaric measures which were decided and are being decided for further wage reductions ... new tax hikes and mass layoffs, public sector ADEDY said in a statement.(Additional reporting by Erik Kirschbaum in Berlin, Alexandria Sage in Paris, Elizabeth O'Leary and Judy MacInnes in Madrid, Valentina Za in Milan, Ingrid Melander in Athens; editing by Ron Askew; Writing by Paul Taylor; editing by Janet McBride)

Analysis: Bernanke leaves investors mulling QE3 odds ReutersBy Steven C. Johnson and Karen Brettell | Reuters – SEPT 29,11

NEW YORK (Reuters) - Ben Bernanke put markets on notice this week: Despite already having spent trillions of dollars to stimulate growth, the Federal Reserve would do more if inflation falls too far and the threat of deflation grows.Bond investors are taking the Fed chairman at his word. If things get worse, some predict the central bank will go beyond targeting interest rates and move straight to outright buying of mortgage securities, municipal debt and even stocks.When I think of the Fed I think everything is on the table until it isn't, said Eric Green, chief economist and head of interest rate strategy at TD Securities in New York.If the economy appears on the verge of deflation, the Fed will have to go very big and be very creative, and that means munis are on the table, mortgage-backed securities, corporate (bonds), equities, he said.Everything is possible because the Fed has broken new ground and they will continue to do so if they feel they have to, exit strategy be damned.The Fed has pushed short-term interest rates to record lows and last week announced it would attempt to push down long-term rates by selling $400 billion of short-dated Treasuries to buy an equal amount of debt with maturities of seven years and up, in a policy dubbed Operation Twist.This was designed to help the housing market by lowering long-term borrowing costs. It would also encourage investors to sell Treasuries for higher-yielding assets, which should boost stocks and corporate profits, encourage hiring and investment and provide a jolt to consumer sentiment and prices.

THEORY AND REALITY

That, at least, is the theory.But fear that the economy may already be in recession has been pushing down stocks, commodities and Treasury yields for several months. U.S. stocks <.SPX> are more than 10 percent weaker since the start of August.As a result, market expectations for U.S. inflation have retreated to levels last seen in September 2010, shortly before the Fed began a $600 billion bond buying program, the second installment of a policy known as quantitative easing, or QE.When asked about this after a speech on Thursday, Bernanke said, if inflation falls too low or inflation expectations fall too low, that would be something we would have to respond to because we do not want deflation.The expected rate of inflation over the next 10 years as measured by the gap between Treasury inflation-protected securities (TIPS) and cash government bonds fell as low as 1.70 percent last week. At 1.83 percent on Thursday, it was still below the Fed's unofficial inflation target around 2 percent.St. Louis Fed President James Bullard chimed in on Thursday, saying he was troubled by the decline in market inflation expectations. But he added that deflation was not yet a risk and that the bar to more Fed easing remained high.

That could change, though.If inflation stays very low, that's going to create a clear path for more forms of unconventional easing, said Jim Caron, head of interest rate strategy at Morgan Stanley. I don't know how much the market is paying attention to that. But I wouldn't count anything out.

TREASURY ALTERNATIVES

With interest rates already at record lows, Caron said a QE3 would likely target assets other than Treasuries.Mortgage debt is one candidate, and because the market is not as liquid as the government bond market, the Fed might have more success pushing investors into riskier assets.During QE2, households, one of the largest groups of Treasuries buyers, simply increased investments in other low-risk debt such as agencies, municipal and corporate bonds when the Fed started buying Treasuries.The point would be to force (investors) into other risk assets knowing that the Bernanke put is no longer imagined, it's actually in place, Green said.If the Fed is buying equities, it wants to create more favorable conditions, which means stronger risk assets, tighter credit spreads and lower rates.

MISLEADING SIGNALS?

Even as the risks rise, the Fed will have to tread carefully. Data showed core consumer prices, which remove energy and food costs, rose at a 2 percent rate in the 12 months to September, near the top of the Fed's comfort zone.That seems to clash with signals from the TIPS market, but some say those signals may be misleading.
Philadelphia Fed President Charles Plosser, one of three central bank officials to vote against Operation Twist, said Thursday that Europe's debt crisis has increased the safe-haven appeal of U.S. government debt, with falling yields narrowing the spread between cash bonds and TIPS.One of the driving factors that led the Fed to embark on QE2 was indeed concern about deflation risk, said Michael Pond, Treasury and inflation-linked strategist at Barclay's Capital.But this time, he added,if the Fed only looks (at TIPS), they would likely be misguided here in thinking the market is pricing in disinflation.(Editing by Burton Frierson and Dan Grebler)

Asia stocks muted after mixed US economic data
APBy PAMELA SAMPSON - AP Business Writer | AP – SEPT 30,11

BANGKOK (AP) — Asian stocks were mixed Friday following a choppy session on Wall Street as investors struggled to make sense of conflicting reports on the health of the U.S. economy.Japan's Nikkei 225 index rose 0.3 percent to 8,723.12. Australia's S&P/ASX 200 index fell 0.5 percent to 3,990.10. Hong Kong's Hang Seng fell 1.7 percent to 17,711.95 and South Korea's Kospi dipped 0.6 percent to 1,759.60.
Benchmarks in mainland China, Taiwan, Malaysia, New Zealand and the Philippines were higher, while Singapore's fell.In New York on Thursday, the Dow Jones industrial average ended higher after data showed first-time applications for unemployment benefits fell to a five-month low. The U.S. government also raised its estimate of economic growth in the April-June period.But other economic reports were weak. A trade group reported that chief executives of the nation's largest companies are more pessimistic than they were just three months ago. Also, fewer Americans signed contracts to buy homes in August, the second straight month of declines.The Dow Jones industrial average rose 1.3 percent to close at 11,153.98 after a day of big swings. The Standard & Poor's 500 index rose 0.8 percent to 1,160.40. The Nasdaq composite index lost 0.4 percent to 2,480.76.In Europe on Thursday, stocks surged after Germany passed a measure to expand the powers of a regional bailout fund.

The measure, which must be approved by all 17 countries that use the euro, will allow the bailout fund to buy government debt and lend money to troubled European countries. Finland approved the measure Wednesday.Oil rebounded following the news out of the U.S. and Europe. Benchmark oil for November delivery was up 56 cents to $82.72 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 93 cents to finish at $82.14 per barrel on the Nymex on Thursday.In currency trading, the euro slipped to $1.3557 from $1.3591 late Thursday in New York. The dollar weakened to 76.51 yen from 76.79 yen.

Facebook under pressure over privacy: source
By Stephen Mangan | Reuters – SEPT 30,11

LONDON (Reuters) - Facebook faces regulatory scrutiny in Ireland, site of its European headquarters, over its handling of personal information, the Financial Times reported on Friday.The newspaper said the Irish data protection commissioner is to conduct a privacy audit of Facebook's activities outside the United States and Canada after complaints by European and U.S. privacy campaigning groups to the Irish commissioner and the U.S. Federal Trade Commission.The groups raised concerns over Facebook's frictionless sharing of reading, listening and viewing activity as well as the use of cookies to track users' browsing.The FT reported that Gary Davis, Irish deputy data protection commissioner, said his office would conduct a detailed audit of the group's activities outside the United States and Canada next month.
This audit will examine the subject matter of the complaint but also will be more extensive and will seek to examine Facebook's compliance more generally with Irish data protection law.Facebook's European headquarters are in Dublin, which makes its operations outside the United States and Canada subject to Irish and European data protection legislation.Facebook was unavailable for immediate comment.(Reporting by Stephen Mangan; Editing by Gary Hill)

Merkel coalition easily passes EU rescue-fund vote
29.09.11 @ 15:34 By Leigh Phillips

In a major domestic victory German Chancellor Angela Merkel, the Bundestag - the country’s lower house of parliament - has robustly backed a strengthening of the eurozone’s multi-billion euro rescue fund.The Bundestag: A night of arm-twisting of rebels assured the passage of the draft law (Photo: Torkil Sørensen/norden.org)
With Merkel’s free-market-liberal coalition allies in the Free Democrats increasingly taking a critical line on Europe and its series of bail-outs for peripheral states, fears were widespread ahead of the vote that the chancellor might not be able to win enough votes within her own coalition to push through the changes to the European Financial Stability Fund without the indignity of having to rely on the opposition Social Democrats and Greens.However, after heavy late-night arm-twisting of rebels, the legislation was approved 523 to 85, with three abstentions. A full 315 members of the governing coalition voted in favour, four more than the 311 needed to win without depending on help from the centre-left.

Just 15 members of the coalition voted against the government.The FDP is battling a massive plunge in popular support, with some polls putting the party on just two percent - far beneath the five percent required to enter parliament. If an election were to be held today, it is likely that the party would be wiped out.Many in the party argue that Germany has already contributed more than enough to European rescues of peripheral countries and that Greece in particular should be left to deal with its alleged profligate ways on its own.Die Linke, the left-wing party, made up the bulk of the 85 dissenters. The group, like many in the FDP, is opposed to the EU-IMF bail-out packages, but for very different reasons, arguing that the rescues are not of peripheral states, but of banks of the core EU countries and that the austerity that comes attached to the rescues hits ordinary people.The chancellor can now breathe a sigh of relief for her own position. A reliance on opposition votes would likely have spelt the end of the governing coalition.Today we will make an important contribution to our nation, to Europe and to the stability of the euro, coalition parliamentary leader Volker Kauder said after the vote.The approval gives the green light from Europe’s biggest economy for the EFSF to purchase government bonds in secondary markets and to participate in bank recapitalisation actions.

The changes to the rescue fund also crucially hike Germany’s contribution to €211 billion, up from €123 billion.Coalition members were also worried that even as the latest expansion of the EFSF, European officials were quietly at work on a still larger rescue operation amounting to as much as €2 trillion.EU officials and core-nation domestic sources have confirmed that various options on a leveraging of the EFSF are under consideration.German finance minister Wolfgang Schaeuble lashed out at suggestions that such a plan was underway.Nothing is being kept secret or being kept quiet, he said during the debate in the Bundestag.He emphasised that today’s vote is only about the new sums and the new powers of the EFSF and nothing else.So every suspicion and every uncertainty is indecent and inappropriate, he said.
However, the minister appeared to leave the door open to adjustments to the bail-out fund, saying: The guidelines on the enlarged EFSF have not been finally negotiated.He continued that the parliament would have to approve these guidelines indicating that this will allow MPs to see what framework is being negotiated.The changes to the EFSF must be approved by all 17 eurozone states. A total of nine so far have done so, including Finland on Wednesday.

Slovakia remains a potential hurdle, with one of the four coalition parties in the government, the libertarian Freedom and Solidarity party, having been steadfastly opposed to the bail-out mechanism.However, late on Wednesday, the party’s parliamentary leader, Jozef Kollar, indicated to TV Markiza that the party is close to an agreement with the other parties on giving its assent.Kollar said that the condition the party is attaching to its backing is that Slovakia would not have to contribute to the fund.Prime Minister Iveta Radicova is pushing for a vote before the autumn EU summit, meaning 16 October at the latest.

Banks to pay fair share under EU transactions tax
Today SEPT 29,11 @ 09:28 By Leigh Phillips

The European Commission on Wednesday (28 September) unveiled plans to slap a tax on financial transactions in the EU, a scheme that the EU executive hope will raise some €57 billion a year in revenues.Banks must be made to pay their fair share the commission says (Photo: Trois Têtes)Jose Manuel Barroso, the president of the commission announced that the college of commissioners had adopted the proposal, long expected and dreaded by the City of London, during his state of the union address to the European Parliament in Strasbourg.All financial transactions in which at least one party is located in the EU would come under the purview of the proposed rules. The commission would like to see both derivative contracts and trades in shares and bonds taxed at 0.1 percent from January 2014.Brussels said that now, when governments are putting the squeeze on public services in order to unwind heavy public debtloads, was the time to introduce such a measure to ensure that the financial sector makes a fair contribution.Public debt in all 27 EU member states jumped from below 60 percent of GDP to 80 percent at the beginning of the crisis, largely as a result of the financial sector receiving €4.6 trillion in assistance from governments.The commission also said in a statement outlining the proposals that banking world is currently under-taxed by comparison to other sectors.The aim is also to establish new minimum tax rates and harmonise different existing taxes on financial transactions in the EU, aiming to reduce distortions in the bloc’s single market.

Our project is sound and workable. I have no doubt this tax can deliver what EU citizens expect; a fair contribution from the financial sector, said tax commissioner Algirdas Semeta upon the announcement of the proposal.The move would aim to capture a slice of 85 percent of transactions between financial institutions, but citizens themselves and non-financial-sector businesses would exempt. Mortgages, bank loans, insurance contracts and other financial activities carried out by individuals or small businesses fall outside the scope of the proposal, the commission said.The plans have strong support from French President and current chair of the G20 Nicolas Sarkozy, who is likely to raise the EU plan at the next meeting of the world’s leading economies in Cannes on 3 November.Germany, Spain, Finland, Luxembourg, Belgium, Austria, Hungary, Greece and Portugal are also believed to be committed backers of the move at an EU level.However the UK, home to the City of London financial district, is implacably opposed and has suggested that it will veto the move.Britain says it is not opposed in principle, but that it must be imposed at a global level, otherwise banks will simply move out of the EU to more amenable tax climates.The government will continue to engage with its international partners on financial transaction taxes and has no objection to them in principle, said the British treasury. But any financial transaction tax would have to apply globally and there are a number of practical issues that need to be worked through. These issues are underlined by the commission's own analysis.Oxfam, the anti-poverty organisation that has long campaigned for such a Robin Hood Tax, welcomed the proposals, but said that the funds must be used not merely to shore up EU budgets, but distributed to help poor countries facing chilling reductions in aid, trade, and investment.

US threat of military action unites Pakistan
APBy CHRIS BRUMMITT - Associated Press | AP – SEPT 29,11

ISLAMABAD (AP) — U.S. accusations that Pakistan is supporting Afghan insurgents have triggered a nationalist backlash and whipped up media fears of an American invasion, drowning out any discussion over the army's long use of jihadi groups as deadly proxies in the region.The reaction shows the problem facing the United States as it presses Pakistan for action: Strong statements in Washington provoke a negative public response that makes it more difficult for the army to act against the militants — even if it decided it was in the country's interest to do so.Pakistan's mostly conservative populace is deeply suspicious of U.S. intentions a decade after Washington forged an alliance with Islamabad. Many people here believe the U.S. wants to break up Pakistan and take its arsenal of nuclear weapons, and America is very unpopular throughout the country.By contrast, Pakistanis lack unity against Islamic militants. Politicians and media commentators are often ambiguous in their criticism of the Pakistani Taliban, despite its carrying out near weekly bombings in Pakistan over the past four years.One small private television channel has aired an advertisement that features images of Adm. Mike Mullen, America's top military officer, and Defense Secretary Leon Panetta along with scenes of the Pakistani army fighting and raising the country's flag.Each time the Americans appear, a shrill voice sings: Enemies, you have challenged a nation which has a growing knowledge of the Quran and the support from Allah. Our task in this world is to eliminate the name of the killers! Mullen's comments on Capitol Hill last week set off the storm.

He said the Haqqani network, the most deadly and organized force fighting American troops in Afghanistan, was a veritable arm of Pakistan's premier spy agency, the strongest public statement yet by U.S. officials on Pakistan's long suspected duplicity.He and other U.S. officials suggested that the U.S. would use any means necessary to defend itself. That raised speculation here that America might deploy troops in Pakistan's North Waziristan territory, the Afghan border region where the Haqqanis are based.Most analysts view that scenario as highly unlikely because of the risks it entails for U.S. interests in the region. But it has not stopped right-wing politicians and retired generals that are well represented on TV talk shows from speculating on the threat of American boots on Pakistani soil.On Thursday, the leaders of the country's feuding political parties will put aside their differences to sit under one roof to discuss the issue. In announcing the meeting, Prime Minister Yousuf Raza Gilani said the lawmakers will discuss the security situation in the wake of threats emanating from outside the country.The Sunni Ittehad Council, an organization representing the country's Barelvi sect, often referred to as the most moderate among Pakistani Muslims, issued a statement saying it was obligatory on all Muslims to wage jihad against the United States if it attacked Pakistan.The Pakistani government and the armed forces should start preparing to counter any possible American attack as Islamic law suggests keeping the horses ready' to counter any sort of foreign aggression, the statement said.
There have been a few small street protests since Mullen's comments, but nothing major.

In some respects, the situation mirrors the atmosphere after the May 2 American helicopter raid on Osama bin Laden, which was carried out without the knowledge of the Pakistani army. There was outrage then over the infringement of the country's sovereignty by the U.S., but little on how bin Laden had been living in the army town of Abbottabad for so long.Now, the focus is on Pakistan's public humiliation at the hands of a supposed ally — and the threat of American action.There appears to have been little debate on whether Pakistan is right to allow the Haqqani network free reign in parts of the country. Nor has there been much discussion of Pakistan's historical use of militant proxies in India. This is all the more striking because the Haqqani network and other militants are allied, at least ideologically, to the Pakistani Taliban, who carry out attacks inside Pakistan.The dominant right-wing narrative in Pakistan following Mullen's comments has been that the United States is losing the war in Afghanistan and wants to pin the blame on Islamabad. The threat posed by the Haqqani network is seen as exaggerated, and tackling them now is thought not to be in Pakistan's interest.The anger this week at America coincided with the visit of Chinese Public Security Minister Meng Jianzhu, allowing the media and politicians to peddle another populist trope: that Beijing will be able to replace the United States as a source of funds if and when Pakistan chooses to sever its ties with Washington.American allegations and threats have extremely endangered our country's security and sovereignty. It is high time ... we should consult our friendly neighbors and other countries out of this region and get their support, said an editorial in the right-wing mass circulation paper, Nawa-i-Waqt.Most analysts say this hope is misplaced, noting that Beijing shares international concerns about Pakistan as a breeding ground for terrorism and has shown little sign it wants to prop up the government. The hope also fails to address how China would replace American influence on institutions like the World Bank and the International Monetary Fund.Anti-American sentiment in Pakistan was already rife and growing, following the shooting deaths of two Pakistanis by CIA operatives in Lahore in January and the raid on bin Laden. Both events were portrayed here as further evidence of the malign intentions of the United States.

The Pakistani media tend to focus on the supposed American threat because that's what Pakistanis want to read and hear about, said Cyril Almedia, a liberal political analyst and columnist. But he said there were signs that those who wanted to see the alliance with the United States break down may be disappointed, noting that the army — which receives billions from the United States in aid — had been relatively muted in its reaction.Emotions are running high, but there are indications the military is performing a delicate balancing act, Almedia said.On the one hand, it is trying to give a response that satisfies a paranoid, conservative population and the rank-and-file, yet also a feeling that this is not the moment to cause a complete rupture with the United States.(This version corrects Panetta now defense secretary, no longer CIA head.)