NFLPA: no formal investigation into RG3 injury

WASHINGTON (AP) — The NFL players' union does not plan a formal investigation into how the Washington Redskins medical staff handled Robert Griffin III's knee injury.
The NFL Players Association said Friday that they were satisfied with a report received from the Redskins detailing the procedures used by team physician James Andrews and other staff on the sidelines.
Griffin had reconstructive ACL surgery Wednesday after reinjuring his right knee in Sunday's playoff loss to Seattle. He also strained a ligament in the knee last month against Baltimore.
The NFLPA's informal inquiry focused on the quality of medical care Griffin received. The union does not have authority to investigate coaching decisions — including whether Redskins coach Mike Shanahan should have left Griffin in either game after it was clear the quarterback was hurt.
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Cowboys hire Monte Kiffin to replace Rob Ryan

IRVING, Texas (AP) — The Dallas Cowboys have hired former Tampa Bay defensive coordinator Monte Kiffin as the replacement for Rob Ryan.
The team announced the move on its website Friday, a day after the 72-year-old Kiffin was at team headquarters to interview with coach Jason Garrett and owner Jerry Jones.
The hiring of Kiffin means the Cowboys will switch back to the 4-3 defense after going to the 3-4 under Bill Parcells in 2005.
Kiffin hasn't coached in the NFL since ending a 13-year run in Tampa in 2008. He spent the past few years coaching in college with his son, Lane Kiffin, at Tennessee and Southern California.
At Tampa, Kiffin's defenses frequently were among the league's best, and the Buccaneers won the Super Bowl with him after the 2002 season.
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PREVIEW-NFL-Falcons get chance to end playoff misery

Jan 11 (Reuters) - The Atlanta Falcons earned the top seed in the National Football Conference (NFC) with a 13-3 regular season record but it is a miserable run of form in the playoffs they will try to end against the Seattle Seahawks on Sunday.
Three times in the era of head coach Mike Smith and quarterback Matt Ryan the Falcons have impressed in the regular season but have stumbled in their first games of the post-season.
Last year, the Falcons lost to the New York Giants in the wild-card round after having gone out to the Green Bay Packers in the previous year.
In fairness, both those losses came to teams who went on to win the Super Bowl that season while in 2008, the Falcons fell to the Arizona Cardinals who were so close to winning the whole thing that season.
But the inability of a team, which has looked to have quality in every area on both sides of the ball, to perform on the biggest stage has afflicted Ryan in particular.
In his three losses, the Falcons quarterback has thrown three touchdown passes and four interceptions and his best yardage was the 199 he threw for against the Giants last year - well below his career yards per game average of 243.
Ryan says he has learned from his mistakes and that this year he has been trying to keep to the same routine he has used throughout the regular season.
"The biggest thing is to get settled into your routine. Prepare the way that you normally prepare," he told reporters this week.
"My preparation this year in the regular season has been different than in the last four. I'll be consistent with that I've done this year."
The Seahawks are the biggest surprise package in the playoffs this year, having enjoyed an 11-5 season in the NFC West and then defeating the much-hyped Washington Redskins last week.
Rookie quarterback Russell Wilson has inevitably grabbed the headlines but Sunday's divisional round game could well come down to the match-up between Seattle's cornerback duo of Richard Sherman and Brandon Browner against Atlanta's impressive receivers Roddy White and Julio Jones.
"It is going to be a fun match-up," said Sherman, "They've got two of the best receivers in football. It is going to be fun."
Falcons coach Smith repaid the compliment: "I think it is arguably the best duo at the cornerback position in the NFL this year. They are big, long physical football players," he said.
With two quarterbacks in fine form, the outcome could well come down to who triumphs in that receiver-corner match-up.
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Falcons get chance to end playoff misery

against the Tampa Bay Buccaneers in Atlanta, Georgia December 30, 2012. REUTERS/Tami …more
(Reuters) - The Atlanta Falcons earned the top seed in the National Football Conference (NFC) with a 13-3 regular season record but it is a miserable run of form in the playoffs they will try to end against the Seattle Seahawks on Sunday.
Three times in the era of head coach Mike Smith and quarterback Matt Ryan the Falcons have impressed in the regular season but have stumbled in their first games of the post-season.
Last year, the Falcons lost to the New York Giants in the wild-card round after having gone out to the Green Bay Packers in the previous year.
In fairness, both those losses came to teams who went on to win the Super Bowl that season while in 2008, the Falcons fell to the Arizona Cardinals who were so close to winning the whole thing that season.
But the inability of a team, which has looked to have quality in every area on both sides of the ball, to perform on the biggest stage has afflicted Ryan in particular.
In his three losses, the Falcons quarterback has thrown three touchdown passes and four interceptions and his best yardage was the 199 he threw for against the Giants last year - well below his career yards per game average of 243.
Ryan says he has learned from his mistakes and that this year he has been trying to keep to the same routine he has used throughout the regular season.
"The biggest thing is to get settled into your routine. Prepare the way that you normally prepare," he told reporters this week.
"My preparation this year in the regular season has been different than in the last four. I'll be consistent with that I've done this year."
The Seahawks are the biggest surprise package in the playoffs this year, having enjoyed an 11-5 season in the NFC West and then defeating the much-hyped Washington Redskins last week.
Rookie quarterback Russell Wilson has inevitably grabbed the headlines but Sunday's divisional round game could well come down to the match-up between Seattle's cornerback duo of Richard Sherman and Brandon Browner against Atlanta's impressive receivers Roddy White and Julio Jones.
"It is going to be a fun match-up," said Sherman, "They've got two of the best receivers in football. It is going to be fun."
Falcons coach Smith repaid the compliment: "I think it is arguably the best duo at the cornerback position in the NFL this year. They are big, long physical football players," he said.
With two quarterbacks in fine form, the outcome could well come down to who triumphs in that receiver-corner match-up.
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Instant View: Holiday PC sales slide for first time in over five years

SAN FRANCISCO (Reuters) - Holiday season sales of personal computers fell for the first time in more than five years, according to industry tracker IDC, as Microsoft Corp's Windows 8 failed to excite buyers and many opted for tablet devices and powerful smartphones instead.
Commentary:
SHAW WU, ANALYST, STERNE AGEE
"Things are getting really tough for Dell, which is not well-positioned in emerging markets. The Asia-based players will continue to grow faster.
"It's frankly become an Asia game. HP is also actually turning around its PC business, and that's one of the reasons Dell is losing a lot of share.
"Windows 8 wasn't going to be as big a catalyst. It's so different, it's almost uncomfortably different from past Windows, and there's a risk that Windows 8 ends up like Vista.
"We're not surprised with the data, and everybody knows the trends are coming, but seeing the numbers seems to crystallize it."
ASHOK KUMAR, ANALYST, MAXIM GROUP
"That's in line to slightly worse than expected. There are multiple factors causing stagnation in the PC market.
"There's been an elongation of the replacement cycle from once every five years to once every 10 years. Historically, about 20 percent of the installed base comes up for refresh every year. Now it's 10 percent.
"There's a lack of compelling reasons to upgrade. Increases in performance have been smaller and there are fewer new applications that require more computing horsepower. In developing markets, the first purchase is not a PC, it's a smartphone, especially in markets where literacy levels are low.
"Then, not least of all, there's the incursion of tablets in the PC market.
"There are no clear compelling product cycles coming in the PC market. What could potentially resuscitate the PC market? Ultrabooks could come down in price to the level of regular laptops: $500 instead of $999. But we may be looking at low single digit growth in the PC market for some time."
AARON RAKERS, ANALYST, STIFEL, NICOLAUS & CO
"Looking at the data from the past few months, I don't think anybody is going to be terribly surprised by these numbers. A lot of people were expecting shipments in the 90 million range.
"I just came from CES and meetings with Intel and Dell. The sense is that until Windows 8 is fully installed and prices start to come down, we will be in this state of negative dynamics in the PC market. I do think that this will lift this year as Windows XP loses support from Microsoft."
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Short-sellers circle stocks as confidence wavers

LONDON (Reuters) - How durable is the Wall Street bounce following last week's U.S. budget deal? Not very, some speculators believe.
Hedge funds are betting that a rally in U.S. stocks after a retreat from the "fiscal cliff" will reverse as doubts grow that politicians are ready to sacrifice party interests to keep the world's economic engine running, early data shows.
On the cusp of a January 1 deadline, Republicans and Democrats agreed a moratorium on a package of tax hikes and budget cuts critics claimed would tip the United States back into recession.
The news triggered sharp gains in the S&P 500 index <.spx>, which rose 2.5 percent to 1,462 points on January 2. But the momentum is fading, leading some funds and analysts to predict a tough near-term outlook for U.S. equities.
"The recent rally is an opportunity to open promising short positions. Taxes are going up in some shape and form and spending will have to be reduced," said Athanasios Ladopoulos, chief investment officer of hedge fund firm Swiss Investment Managers. "Both feed into negative sentiment down the road."
Data measuring demand to borrow U.S. shares - a proxy for the level of short-selling, or bets on a share price fall - reflects expectations that markets will falter when the next bout of negotiations collides with talks to extend a $16.4 trillion national debt ceiling in February.
According to Sungard Astec Analytics, the aggregate value of U.S. shares on loan rose by 3 percent to $358 billion in the week to January 4, as skeptical funds bet on falls in consumer confidence and company earnings.
That compares with a peak of $404 billion, seen in June when the Federal Reserve rowed back on employment predictions and cut 2012 economic growth forecasts to 2.4 percent from 2.9 percent.
By contrast, the aggregated value of shares in the FTSE 100 <.ftse> on loan fell 4 percent to $1.4 billion in the week to January 4, while the equivalent for the STOXX Europe 600 <.stoxx> dropped 3 percent to $6.6 billion.
Because such bets are struck privately, it's tough to pinpoint exactly when shares are expected to fall. Some bets may be pegged to the impending corporate earnings season, while others will be timed to exploit February's looming fiscal cliff worries.
SHORT, SHARP SHOCK
But even top stock market performers are seen suffering share price volatility until a compromise on cuts and taxes is reached.
Short-sellers are speculators who borrow shares then sell them in the hope of being able to buy them back at a cheaper price, before returning the stock to the original owner.
"While we are positive on U.S. equities for the year, the possibility of a short, sharp contraction on news flow is material in our view," equity strategists at BNP Paribas warned in a note, arguing equity valuations looked over-optimistic.
"The trailing price-to-earnings ratio of 15 times is above long-term averages and earnings growth has slowed to a crawl at best, compared with a consensus forecast for 10 percent," the note said.
Stock lenders - typically long-term investors such as pension funds who can earn a fee by loaning out a stock at little risk to themselves - have also spotted an increased appetite to bet on falling stock prices and have raised the cost to borrow shares by 5 basis points (bps) to about 75 bps on aggregate over the first week of 2013, Astec data shows.
This brings borrowing rates closer to the 78 bps average earned on U.S. equity lending in 2012.
"There is much unfinished business ... not to mention the much bigger question about how the U.S. can meet its long term spending commitments in the face of an ageing population," Ian Kernohan, economist at Royal London Asset Management said.
"Given the polarized nature of U.S. politics at the moment, trying to sort all this out will be an uphill task."
The S&P 500, which rose 13.4 percent in 2012, closed 0.3 percent down at 1,457 on Tuesday. Some commentators say much of the recent growth in U.S. stocks is not due to an influx of optimistic buyers, but short-sellers closing out old bets from 2012 before embarking on a fresh set of short positions.
NOT MAINSTREAM
Heavily-shorted firms like $3.7 billion-valued U.S. Steel Corp and $1.9 billion Advanced Micro Devices saw volumes of stock on loan drop by 15.1 percent to 17.5 percent and 18.6 percent to 14.6 percent respectively in the past month.
This data from financial information firm Markit supports the argument that bears, not bulls, are perversely largely responsible for driving the recent upward move in U.S. stocks.
Certainly a negative view is not mainstream for the year as a whole.
The consensus forecast from respondents to a Reuters poll in December was for the S&P 500 to finish 2013 close to its lifetime high of 1,576.09 set in October 2007.
But signs of fresh short-selling coupled with Friday's underwhelming December jobs data is putting pressure on market optimists.
Speaking at an investment forum hosted by asset manager Notz Stucki on Tuesday, Anatole Kaletsky, a financial economist and Reuters columnist, said cyclical factors such as weak housing markets have been major headwinds but there was evidence these have been neutralised.
But it may take time for this view to be adopted by many consumers. A Reuters/IPSOS online poll of U.S. consumers on Monday found four-fifths of respondents were bracing for another economic downturn.
Additional data from Markit showed sharp increases in demand to short a range of U.S. stocks who stand to lose from a dip in consumer sentiment.
But the list of the 30 most heavily-shorted U.S. names in the week to January 4 spans most sectors including pharmaceuticals, machinery and aerospace & defence, indicating broader pessimism in the market as well as cyclical or stock-specific concerns.
The volume of bets on a fall in the share price of $7.75 billion Tiffany & Co for instance shot up 17 percent last week to 6.4 percent, more than double the 3 percent average short interest on individual S&P stocks.
Demand to short leisure dot-com TripAdvisor Inc was up 11.6 percent to 5.2 percent and Dr Pepper Snapple Group Inc saw stock volumes on loan jump 15.1 percent to 7.8 percent.
"I am of the opinion that when Q4 earnings season starts investors will come to realise that the prospects for 2013 are not that bright," Ladopoulos said. "When the market turns down, it will take with it many of those too optimistic investors."
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Markets rise as Alcoa sees stronger demand

LONDON (AP) — World stock markets rose Wednesday after the fourth-quarter earnings season got off to a positive start in the U.S. with aluminum giant Alcoa forecasting higher demand for 2013.
Sales of aluminum have been hurt by the weak global economy, but Alcoa predicted a 7 percent increase in demand this year, slightly better than the 6 percent increase in 2012. Because Alcoa supplies so many key industries, investors study its results for clues about the health and direction of the overall economy.
"Regional markets are mostly firmer after the Alcoa result set the tone early," said Stan Shamu of IG Markets in Melbourne in a market commentary. "Alcoa's results are generally considered a bellwether for the global economy and the fact that the aluminum giant forecasts higher demand in 2013 appeased investors."
Britain's FTSE 100 rise 1 percent to close at 6,098.65, having earlier traded above 6,100 for the first time since the spring of 2008. France's CAC-40 rose 0.3 percent to 3,717.45.
Germany's DAX ended 0.3 percent higher at 7,720.47, after official figures showed industrial production rose less than expected in November. The 0.2 percent gain was also not enough to offset a 2 percent fall the previous month and means German economic output overall likely fell in the fourth quarter.
Investors will look forward to a monetary policy meeting by the European Central Bank on Thursday for clues on whether the weakening economic outlook is likely to trigger an interest rate cut in the coming months.
On Wall Street, stocks rose as investors there got their first chance to react to the Alcoa results. The Dow Jones industrial average was up 0.6 percent at 13,414.66 while the S&P 500 rose 0.4 percent to 1,463.59.
In Asia, Hong Kong's Hang Seng advanced 0.5 percent to 23,218.47 after a downturn in the prior session, with sentiment helped by gains in mainland Chinese shares.
"Stability in China is helping. We are taking a lot of cues from China-Asia," said Jackson Wong, vice-president of Tanrich Securities in Hong Kong.
Japan's Nikkei 225 index opened lower on a strengthening yen but reversed course as the currency slipped against the dollar. The benchmark in Tokyo gained 0.7 percent to close at 10,578.57.
Australia's S&P/ASX 200 added 0.4 percent to 4,708.10. South Korea's Kopsi was 0.3 percent lower at 1,991.20. Benchmarks in Singapore, Taiwan, Thailand, and the Philippines rose. Indonesia and Malaysia fell. Mainland Chinese stocks were mixed.
Major indexes surged last week after U.S. lawmakers passed a bill to avoid a combination of government spending cuts and tax increases that have come to be known as the fiscal cliff. The deal, however, remains incomplete, and trading has been cautious since then. Politicians will face another deadline in two months to agree on more spending cuts.
In commodity markets, the benchmark crude oil contract for February delivery was down 13 cents to $93.02 per barrel in electronic trading on the New York Mercantile Exchange.
In currencies, the euro fell 0.1 percent to $1.3072 while the dollar rose against the Japanese yen, to 87.92 yen from 87.19 yen.
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Timeline: Geithner's stormy tenure at Treasury nears end

(Reuters) - President Barack Obama will nominate White House chief of staff Jack Lew on Thursday to succeed Timothy Geithner as U.S. Treasury secretary, according to a source familiar with the matter.
Geithner, the longest-serving member of Obama's economic team, had a stormy tenure at Treasury, where he was at the center of the fight against the 2007-2009 financial crisis and deep recession.
Here is a look at the highs and lows of his time at Treasury.
November 24, 2008: President-elect Obama nominates Geithner, then president of the New York Federal Reserve Bank, for Treasury.
January 2009: Nomination hits speed bump when top Republican on Senate Finance Committee reveals irregularities in Geithner's tax returns. Obama administration says Geithner made common mistake with regard to self-employment taxes and Geithner corrects the problem by paying $25,970 in back taxes.
January 26, 2009: Senate votes 60-34 to approve nomination.
February 10, 2009: Stock markets plunge after Geithner sketches out administration's plan to get rid of banks' toxic assets.
Mid-March 2009: Lawmakers start calling for Geithner's resignation after it is revealed that bailed-out insurer AIG paid $165 million in retention bonuses to employees of unit that destroyed the company with bad derivatives bets.
March 21, 2009: Obama says would not accept Geithner's resignation even if he tried to resign.
March 23, 2009: Geithner rolls out toxic asset plan for second time with more details. Stock markets rally.
Early June 2009: GM files for bankruptcy. The Treasury buys bulk of automaker's assets and takes a 60 percent stake in the company.
Mid-June 2009: Obama announces reforms for the financial system that sets the Dodd-Frank regulation bill in motion. Geithner, a key architect, starts selling the plan to Congress.
July 21, 2010: Dodd-Frank becomes law.
November 17, 2010: GM raises $20.1 billion in initial public offering. Treasury sells $13 billion of GM stock, leaving it with about 500 million shares.
February 14, 2011: Geithner unveils three options for future of housing finance market that range in levels of government support. Obama administration does not choose a specific path but says it wants to eventually wind-down Fannie Mae and Freddie Mac, the government controlled financial firms that help finance bulk of new home loans. A revamp of the housing finance system remains unfinished business.
March 8, 2011: Geithner meets then-European Central Bank President Jean-Claude Trichet and German Finance Minister Wolfgang Schaeuble in a surprise visit in Germany ahead of a EU summit to press them to beef up rescue fund for debt-laden euro zone nations.
May through July 2011: Geithner battles with House Republicans over raising the U.S. debt limit.
August 2, 2011: Congress approves increase in debt limit as part of deal that also puts in place a plan to automatically cut $1.2 trillion in defense and domestic programs over ten years if no other agreement is reached to trim nation's budget -- a key element of the so-called "fiscal cliff"
August 5, 2011: S&P downgrades long-term U.S. credit rating by one notch, citing the political dysfunction around the debt ceiling battle. Geithner is outraged and Treasury questions S&P's credibility, noting the agency's initial analysis relied on a government discretionary spending estimate that was $2 trillion too high.
September 16, 2011: Geithner, speaking at EU finance ministers meeting in Poland, rankles some of the ministers as he urges them to beef up Europe's financial bailout fund.
February 22, 2012: Obama administration rolls out corporate tax reform plan that would cut top rate to 28 percent from 35 percent, but declines to push plan ahead of November elections.
August/September 2012: Geithner in spotlight over probe into bank rigging of international interest rate benchmark Libor that dates back to his time at New York Fed. Documents show Geithner urged British authorities to look into how the rate was set, but critics question why New York Fed did not do more.
Late-November 2012: Obama chooses Geithner to lead negotiations with Congress to avert year-end fiscal cliff of spending cuts and tax hikes.
December 10, 2012: Treasury announces plan to sell its remaining shares in AIG, says combined Treasury-Fed $182 billion bailout had positive return of $22.7 billion.
December 19, 2012: Treasury says to sell remaining shares in GM within 12-15 months; taxpayers stand to lose billions of dollars.
January 1, 2013: Congress approves deal to avert fiscal cliff. Plan lets tax rates rise only for wealthiest Americans; postpones first installment of automatic spending cuts for two months.
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Business leaders warn UK PM against leaving EU

LONDON (AP) — Top business executives have warned U.K. Prime Minister David Cameron that he could damage Britain's economy if he seeks to renegotiate the terms of its membership in the 27-country European Union.
In a letter published in the Financial Times on Wednesday, Virgin Group's Richard Branson, London Stock Exchange head Chris Gibson-Smith and eight other business leaders challenged Cameron's plan to renegotiate the U.K.'s EU membership terms and put the matter to a referendum.
The executives warned that such a plan could fail, pushing the U.K. out of the EU and hurting business in the process.
Membership in the EU has given the U.K. access to the massive European market as well as a say in how the region should govern itself and run its financial markets. The country has also benefited from EU funds to build infrastructure such as broadband networks.
However, popular distrust of the EU has grown in Britain — one of the 10 countries in the region that doesn't use the euro. The British public shows no interest in the EU's plans to move closer together. Most can't even seem to stomach the current level of power of the EU, which many Britons see as meddlesome and inefficient.
Though the business leaders urged EU reform in their letter, they argued "we must be very careful not to call for a wholesale renegotiation of our EU membership, which would almost certainly be rejected."
"To call for such a move in these circumstances would be to put our membership of the EU at risk and create damaging uncertainty for British business, which are the last things the prime minister would want to do," they said.
A senior U.S. official also expressed concern about the prospect of a referendum, saying the Obama administration wants to see a "strong British voice" in the EU.
Philip Gordon, the U.S. assistant secretary for European affairs, told reporters in London that "referendums have often turned countries inward" — but stressed that whatever is in the U.K.'s interest is up to the U.K.
"We welcome an outward-looking EU with Britain in it," he said.
Tough economic times are forcing the 17 EU countries that use the euro to move ever closer, creating a more powerful union that could leave non-euro members like Britain with less negotiating power.
But while Cameron wants Britain to remain in the EU and to retain influence in the body, he is also resisting a push by many member states, like France and Germany, to grant central authorities in Brussels greater powers over financial and legal affairs for the whole of the EU. In the long run, many EU countries want to turn the bloc into a United States of Europe, an idea British politicians, particularly among Cameron's Conservatives, abhor.
Cameron is due to make a speech in mid-January to outline his position and the requests he will make. On Wednesday, he told lawmakers that Britain could get the changes it wanted.
"We're active players in the European Union but there are changes we would like in our relationship that would be good for Britain and good for Europe and I think, because of the changes in eurozone which is driving a lot of change in the European Union, there's every opportunity to achieve that settlement and seek consent for it," he said.
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Texas school can force teenagers to wear locator chip: judge

SAN ANTONIO (Reuters) - A public school district in Texas can require students to wear locator chips when they are on school property, a federal judge ruled on Tuesday in a case raising technology-driven privacy concerns among liberal and conservative groups alike.
U.S. District Judge Orlando Garcia said the San Antonio Northside School District had the right to expel sophomore Andrea Hernandez, 15, from a magnet school at Jay High School, because she refused to wear the device, which is required of all students.
The judge refused the student's request to block the district from removing her from the school while the case works its way through the federal courts.
The American Civil Liberties Union is among the rights organizations to oppose the district's use of radio frequency identification, or RFID, technology.
"We don't want to see this kind of intrusive surveillance infrastructure gain inroads into our culture," ACLU senior policy analyst Jay Stanley said. "We should not be teaching our children to accept such an intrusive surveillance technology."
The district's RFID policy has also been criticized by conservatives, who call it an example of "big government" further monitoring individuals and eroding their liberties and privacy rights.
The Rutherford Institute, a conservative Virginia-based policy center that represented Hernandez in her federal court case, said the ruling violated the student's constitutional right to privacy, and vowed to appeal.
The school district - the fourth largest in Texas with about 100,000 students - is not attempting to track or regulate students' activities, or spy on them, district spokesman Pascual Gonzalez said. Northside is using the technology to locate students who are in the school building but not in the classroom when the morning bell rings, he said.
Texas law counts a student present for purposes of distributing state aid to education funds based on the number of pupils in the classroom at the start of the day. Northside said it was losing $1.7 million a year due to students loitering in the stairwells or chatting in the hallways.
The software works only within the walls of the school building, cannot track the movements of students, and does not allow students to be monitored by third parties, Gonzalez said.
The ruling gave Hernandez and her father, an outspoken opponent of the use of RFID technology, until the start of the spring semester later this month to decide whether to accept district policy and remain at the magnet school or return to her home campus, where RFID chips are not required.
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US sees Iran behind hostage photos of ex-FBI agent

WASHINGTON (AP) — Two years after a hostage video and photographs of retired FBI agent Robert Levinson raised the possibility that the missing American was being held by terrorists, U.S. officials now see the government of Iran behind the images, intelligence officials told The Associated Press.
Levinson, a private investigator, disappeared in 2007 on the Iranian island of Kish. The Iranian government has repeatedly denied knowing anything about his disappearance, and the disturbing video and photos that Levinson's family received in late 2010 and early 2011 seemed to give credence to the idea.
The extraordinary photos — showing Levinson's hair wild and gray, his beard long and unkempt — are being seen for the first time publicly after the family provided copies to the AP. The video has been previously released.
In response to Iran's repeated denials, and amid secret conversations with Iran's government, Secretary of State Hillary Clinton said in a statement in March 2011 that Levinson was being held somewhere in South Asia. The implication was that Levinson might be in the hands of terrorist group or criminal organization somewhere in Pakistan or Afghanistan.
The statement was a goodwill gesture to Iran, one that the U.S. hoped would prod Tehran to help bring him home.
But nothing happened.
Two years later, with the investigation stalled, the consensus now among some U.S. officials involved in the case is that despite years of denials, Iran's intelligence service was almost certainly behind the 54-second video and five photographs of Levinson that were emailed anonymously to his family. The tradecraft used to send those items was too good, indicating professional spies were behind them, the officials said, speaking on the condition of anonymity because they weren't authorized to talk publicly. While everything dealing with Iran is murky, their conclusion is based on the U.S. government's best intelligence analysis.
The photos, for example, portray Levinson in an orange jumpsuit like those worn by detainees at the U.S. prison at Guantanamo Bay. The family received them via email in April 2011. In each photo, he held a sign bearing a different message.
"I am here in Guantanamo," one said. "Do you know where it is?"
Another read: "This is the result of 30 years serving for USA."
Iranian President Mahmoud Ahmadinejad has personally and repeatedly criticized the U.S. over its detention facility at Guantanamo Bay.
U.S. operatives in Afghanistan managed to trace the cellphone used to send the photographs, officials said. But the owner had nothing to do with the photos, and the trail went cold.
It was that way, too, with the hostage video the family received. It was sent from a cyber cafe in Pakistan in November 2010. The video depicted a haggard Levinson, who said he was being held by a "group." In the background, Pashtun wedding music can be heard. The Pashtun people live primarily in Pakistan and Afghanistan, just across Iran's eastern border.
Yet the sender left no clues to his identity and never used that email address again.
Whoever was behind the photos and video was no amateur, U.S. authorities concluded. They made no mistakes, leading investigators to conclude it had to be a professional intelligence service like Iran's Ministry of Intelligence and Security.
Levinson's wife, Christine, provided the photos to The Associated Press because she felt her husband's disappearance was not getting the attention it deserves from the government.
"There isn't any pressure on Iran to resolve this," she said. "It's been much too long."
Though U.S. diplomats and the FBI have tried behind the scenes to find Levinson, of Coral Springs, Fla., and bring him home, both presidents George W. Bush and Barack Obama have said little about his case and have applied little public pressure on Iran for more information about Levinson's whereabouts.
Christine Levinson has watched more public pressure result in Iran's release of a trio of hikers, a journalist named Roxana Saberi and a team of British sailors captured by the Iranian Navy. Everyone has come home except her husband.
Washington's quiet diplomacy, meanwhile, has yielded scant results beyond the Iranian president's promise to help find Levinson.
"We assumed there would be some kind of follow-up and we didn't get any," Christine Levinson said. "After those pictures came, we received nothing."
In one meeting between the two countries, the Iranians told the U.S. that they were looking for Levinson and were conducting raids in Baluchistan, a mountainous region that includes parts of Pakistan, Iran and Afghanistan, U.S. officials said. But the U.S. ultimately concluded that the Iranians made up the story. There were no raids, and officials determined that the episode was a ruse by Iranian counterintelligence to learn how U.S. intelligence agencies work.
In a statement late Tuesday, Alireza Miryusefi, a spokesman for Iran's U.N. Mission, said the Iranian government has been assisting the Levinson family to find the ex-FBI agent. "Even his family traveled to Iran and were accommodated by the government. Further investigation proved that Levinson is not in Iran and there is no single evidence that he is in Iran."
The spokesman added: "It is a very important to find an FBI agent who had traveled to a free zone of Iran, which if he is found, then the U.S. should explain why the said agent has been sent to Iran and what was his mission."
An expert on Russian organized crime, Levinson retired from the FBI in 1998 and became a private investigator. He was investigating cigarette smuggling in early 2007, and his family has said that took him to the Iranian island of Kish, where he was last seen. Kish is a popular resort area and a hotbed of smuggling and organized crime. It is also a free trade zone, meaning U.S. citizens do not need visas to travel there.
FBI spokeswoman Jacqueline Maguire said: "As we near the sixth anniversary of his disappearance, the FBI remains committed to bringing Bob home safely to his family."
In an interview, Levinson's wife said that because her husband disappeared in Iran, she believes her husband is still being held there. She doesn't think the U.S. government has put enough pressure on Iran to release her husband.
"It needs to come front and center again," Levinson said. "There needs to be a lot more public outcry."
She said she has met with Obama and John Brennan, Obama's counterterrorism czar and nominee to run the CIA. She said that both men pledged to do everything they could to free her husband. Now, nearly six years after his disappearance, she thinks Iran is being let off the hook.
"He's a good man," she said. "He just doesn't deserve this."
Meanwhile, Robert Levinson will miss another family milestone when his oldest daughter Susan gets married in February.
"He's missed so many," his wife said. "It's very upsetting.
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Debt ceiling no place for stand on spending: Nasdaq's Greifeld

NEW YORK (Reuters) - The U.S. borrowing limit should not be used as leverage by members of Congress to force the Obama administration to cut spending as there will be other opportunities to make a stand, said Robert Greifeld, chief executive of Nasdaq OMX Group.
The debt ceiling, which could be hit as early as mid-February, has been dragged into a high-stakes fiscal battle snarling Washington, with Republicans refusing to raise it unless Democrats agree to deep spending cuts to tame the ballooning national debt. Neither side is giving much ground.
"The full faith and credit of the U.S. government is an important concept that we should not violate, because these are debts that have been incurred and are coming due, so it is just not right," Greifeld said in an interview on Tuesday.
A failure by Washington to reach a deal to increase the $16.4 trillion legal limit on the nation's debt raises the threat of a U.S. default, another credit downgrade and a panic in the financial markets.
Greifeld is one of more than 100 CEOs who are part of a group called "Campaign to Fix the Debt." The group has been pushing Congress to work together to create a long-term plan to get the federal deficit under control through both increased taxes and spending cuts.
TRIPLE FISCAL FIASCO
Fix the Debt mounted a media blitz in the two months leading up to the so-called fiscal cliff - a package of automatic tax increases and indiscriminate spending cuts scheduled to start at the beginning of the year that threatened to push the nation back into recession, until averted by last-minute legislation.
During the media campaign, the business leaders lined up to say it was okay to raise taxes on the wealthy, but that spending cuts in programs such as Medicare and Social Security were needed as well to put the United States on a more sound fiscal footing.
But the 11th-hour bill, which included tax hikes on household incomes over $450,000, pushed forward the decision on spending cuts, known as the "sequester," by two months, setting up another, possibly more damaging scenario.
In late February-early March, the delay in the sequester ends, the federal government hits its borrowing limit, and authorization for the federal budget runs out.
Erskine Bowles, a former chief of staff to Bill Clinton who along with former Republican senator Alan Simpson founded Fix the Debt, called it "a triple fiscal fiasco."
"If you think you saw uncertainty and concern when we were facing the fiscal cliff, man, you haven't seen anything yet," Bowles told reporters at a press conference at Nasdaq's MarketSite in New York.
SEVERELY DISAPPOINTED
Raising the debt ceiling periodically has not traditionally been a major issue, as government must account for the deficits resulting from its tax and spending decisions.
But last August was an exception. Congress attempted to make spending cuts a condition of raising the debt ceiling, causing volatility in the markets as the United States was pushed to the brink of default and its credit rating was cut.
Greifeld said he and other CEOs were "severely disappointed" that meaningful spending cuts were not addressed in the fiscal cliff negotiations, but that they are hopeful a more balanced approach will be taken in the near future. There will also be other opportunities to force the issue.
"The sequester - we kind of stand out there as the place to make a stand. The debt ceiling is not the place to do it," he said.
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Google executive chairman arrives in North Korea

PYONGYANG, North Korea (AP) — Google's chairman wants a firsthand look at North Korea's economy and social media landscape during his private visit Monday to the communist nation, his delegation said, despite misgivings in Washington over the timing of the trip.
Eric Schmidt, executive chairman of one of the world's biggest Internet companies, is the highest-profile U.S. executive to visit North Korea — a country with notoriously restrictive online policies — since young leader Kim Jong Un took power a year ago. His visit has drawn criticism from the U.S. State Department because it comes only weeks after a controversial North Korean rocket launch; it has also prompted speculation about what the businessman hopes to accomplish.
Schmidt arrived on a commercial Air China flight with former New Mexico Gov. Bill Richardson, who has traveled more than a half-dozen times to North Korea over the past 20 years.
Richardson, speaking ahead of the flight from Beijing, called the trip a private, humanitarian mission.
"This is not a Google trip, but I'm sure he's interested in some of the economic issues there, the social media aspect. So this is why we are teamed up on this," Richardson said without elaborating on what he meant by the "social media aspect."
"We'll meet with North Korean political leaders. We'll meet with North Korean economic leaders, military. We'll visit some universities. We don't control the visit. They will let us know what the schedule is when we get there," he said.
U.S. officials have criticized the four-day trip. North Korea on Dec. 12 fired a satellite into space using a long-range rocket. Washington condemned the launch, which it considers a test of ballistic missile technology, as a violation of U.N. Security Council resolutions barring Pyongyang from developing its nuclear and missile programs. The Security Council is deliberating whether to take further action.
"We continue to think the trip is ill-advised," State Department spokeswoman Victoria Nuland told reporters Monday, reiterating the U.S. position that the visit is badly timed. However she added that the government would be open to hearing from the delegation after they return from North Korea.
The trip was planned well before North Korea announced its plans to send a satellite into space, two people with knowledge of the delegation's plans told The Associated Press. AP first reported the group's plans last Thursday.
Schmidt, a staunch proponent of Internet connectivity and openness, is expected to make a donation during the visit, while Richardson will try to discuss the detainment of a U.S. citizen jailed in Pyongyang, members of the delegation told AP. They asked not to be named, saying the trip was a private visit.
"We're going to try to inquire the status, see if we can see him, possibly lay the groundwork for him coming home," Richardson said of the U.S. citizen. "I heard from his son who lives in Washington state, who asked me to bring him back. I doubt we can do it on this trip."
The visit comes just days after Kim, who took power following the Dec. 17, 2011, death of his father, Kim Jong Il, laid out a series of policy goals for North Korea in a lengthy New Year's speech. He cited expanding science and technology as a means to improving the country's economy as a key goal for 2013.
North Korea's economy has languished for decades, particularly after the collapse of the Soviet Union, which since the mid-1940s had provided the country with an economic safety net. North Korea, which has very little arable land, has relied on outside help to feed its people since a famine in the 1990s.
In recent years, North Korea has aimed to modernize its farms and digitize its factories. Farmers told the AP that management policies were revamped to encourage production by providing workers with incentives.
Computer and cellphone use is gaining ground in North Korea's larger cities.
However, most North Koreans only have access to a domestic Intranet system, not the World Wide Web. For North Koreans, Internet use is still strictly regulated and allowed only with approval.
Schmidt, who oversaw Google's expansion into a global Internet giant, speaks frequently about the importance of providing people around the world with Internet access and technology.
Google now has offices in more than 40 countries, including all three of North Korea's neighbors: Russia, South Korea and China, another country criticized for systematic Internet censorship.
Accompanying Schmidt is Jared Cohen, a former U.S. State Department policy and planning adviser who heads Google's New York-based think tank. The two collaborated on a book about the Internet's role in shaping society called "The New Digital Age" that comes out in April.
Also leading the delegation is Kun "Tony" Namkung, a Korea expert who has made frequent trips to North Korea over the past 25 years and has worked as a consultant for The Associated Press.
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Softer liquidity rules lift Europe's banks

LONDON (Reuters) - French and German bank shares rose on Monday after regulators softened draft rules aimed at preventing a Lehman Brothers-style collapse that critics said threatened to delay a European economic recovery.
Global regulators on Sunday gave banks four more years and greater flexibility to improve their funding positions, due to fears that an earlier plan for new liquidity rules would have made them reluctant to lend, particularly in Europe where credit conditions are already tough.
Europe's bank index <.sx7p> rose 1.1 percent to 172 points by 1600 GMT, after hitting 173.7, its highest in 17 months. France's Societe Generale and Credit Agricole , Germany's Deutsche Bank , Italy's Unicredit and Britain's Barclays all rose by more than 2 percent.
"This is a clear sign that regulators are adapting to the changing economic environment," said Carla Antunes-Silva, analyst at Credit Suisse.
Global financial regulators have tightened bank rules since the 2008 financial crisis and the liquidity coverage ratio (LCR) will be the first global liquidity standard when it comes into force from 2015. It aims to safeguard taxpayers by ensuring banks hold easily tradeable assets to keep them afloat if markets freeze up.
The pullback from an earlier draft at a meeting in Basel on Sunday went further than many analysts had expected.
The regulators decided to allow a wider pool of assets to count as highly liquid, including good quality corporate bonds, some equities and retail mortgage-backed securities (RMBS). They also changed their estimates for the outflow of deposits in a "stressed" situation and agreed that the standards will be phased in from 2015 and not fully implemented until 2019.
The changes could give a lift to earnings for banks across the board, with firms in a weaker funding position now under less strain to conform, and banks with better funding probably able to reduce their surplus liquidity and cut interest payments, analysts said.
LOW YIELD
European banks such as Societe Generale, Credit Agricole, Deutsche Bank and Commerzbank risked having to build up bigger holdings of low-risk and low-yielding government bonds, so the relaxation in the planned rules should cut the increase in interest rates they face.
The cost of holding those extra assets could have run to tens of billions of euros for the industry.
"This is significant progress which addresses issues already raised by the European Commission," said EU Commissioner Michel Barnier.
The rules will be formally implemented under EU law in 2015, he said.
The French Banking Federation said the changes were a "step in the right direction" and should reduce constraints on banks' ability to lend. German and British bank groups welcomed the changes, particularly the expansion of assets that can be used.
The changes should also allow stronger banks to cut surplus liquidity they hold, allowing them to benefit from shifting from cash or governments bonds into assets that pay higher interest.
Barclays, for example, had a liquidity pool of 160 billion pounds ($257 billion) at the end of September, giving it an LCR of just below 100 percent under the proposed rules. Under the relaxed rules, 30 billion pounds of that could be considered surplus liquidity and release about 300 million pounds in annual interest costs, analysts at Espirito Santo estimated.
A liquidity rule could have prevented the short-term funding freeze that brought down lenders like U.S. investment bank Lehman Brothers and UK mortgage lender Northern Rock during the 2007-09 crisis.
But banks and some regulators had warned the original plan could spark another huge wave of deleveraging.
Banks are still restructuring and shrinking their balance sheets. Euro zone banks are two-thirds through their deleveraging process and are likely to shed another 132 billion euros of assets this year, Ernst & Young estimated on Monday, and regulators want to stop that retreat being too aggressive.
The liquidity rules will run alongside tougher capital rules - covering the amount banks have to hold to absorb losses - and could have forced banks to cut back on domestic lending.
The Basel Committee, made up of financial regulators from nearly 30 countries, said Sunday's changes mean the average LCR at the world's top 200 banks would rise to 125 percent from 105 percent under the old rules, putting it well above full compliance.
But there is wide range of liquidity across the banks.
If the original plan had been in force at the end of 2011, banks would have needed 1.8 trillion euros more liquidity, or about 3 percent of their assets, the Basel Committee estimated. Two-thirds of that shortfall would have been in Europe.
Some 38 percent of the banks would have had a ratio of below 75 percent - above the 60 percent level they now need to reach by 2015, but below the 100 percent standard set for 2019.
Analysts said major banks are likely to remain under pressure from investors to fully meet the rules by 2015, so the main winners of the longer time-frame will be smaller euro zone banks who were struggling to get cheap funding.
Widening the pool of assets should boost the market for RMBS and ease the pressure on banks to hold government bonds, after the euro zone crisis showed their risks to banks and sovereigns.
But the changes may have a muted impact on attempts to kick-start economic growth, as there remains scant appetite to take on debt, economists warned.
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Egypt talking to IMF again about crucial loan

 Doubts are emerging about the Egyptian government's ability to implement painful austerity measures linked to the International Monetary Fund's critical $4.8 billion loan that could stop an economic collapse.
A top IMF official began talks in Cairo Monday, the latest in the drawn-out negotiations for the loan. The government is confident that the loan would not only cover part of its huge deficit, but also, it would signal to investors that Egypt is again a safe bet after two years of turmoil that started with the 2011 uprising that unseated longtime President Hosni Mubarak.
But the Islamist government that replaced Mubarak has already had to postpone final talks on the loan because it was unable to carry out the first steps required by the IMF. President Mohammed Morsi of the Muslim Brotherhood announced some of the measures, including tax increases, but quickly rescinded them over unrest surrounding his proposed constitution, perceived as pro-Islamist.
Now, with parliamentary elections upcoming, critics doubt Morsi will want to — or be able to — implement measures that could stoke new public anger, like cuts in subsidies for fuel and food that allow millions of Egyptians to survive despite their meager incomes.
Despite economic growth in Mubarak's last years in office, poverty deepened. About 40 percent of Egypt's people live near or under the international poverty line of $2 a day.
The head of the IMF's Middle East and Central Asia Department, Masood Ahmed, met Monday with Morsi and his prime minister ahead of the technical talks due to start soon.
Masood's visit comes a day after Prime Minister Hesham Kandil named a new finance minister, aiming to tackle Egypt's deteriorating economy.
The numbers are daunting. The budget deficit from July to November last year reached about $13 billion, compared to $9.5 billion in the same period last year.
The government admitted that its foreign currency reserves are at a critical level — enough for only three months of vital imports. Reserves have plummeted over the past two years, as foreign investment and tourism have dried up.
According to the new constitution, Morsi has to call for new parliamentary elections within the next two months. The parliament to be chosen would be the first to flesh out the constitution with legislation, making its composition — the proportion of Islamists to secular and liberal parties — crucial to the nation's future.
Critics warn that Morsi, as a politician, would be hesitant to impose austerity measures that could further inflame sentiment against the Brotherhood, already losing support because of Egypt's troubles an opposition suspicious of the group's attempt to monopolize power.
"They are in a very difficult situation," said Ahmed Shokr, a founding member of Drop Egypt's Debt Campaign. "They are trying to demonstrate to the IMF they are committed to this program, but on the other hand don't want to do it too quickly ahead of coming elections. I expect whatever they introduce will be very gradual."
Brotherhood officials acknowledge the seriousness of the economic situation and its impact on their popularity.
"The government must take these measures. They can't be postponed, even if they have a negative impact on the party," said Mohammed Gouda, an economic expert in the Brotherhood's political arm, the Freedom and Justice Party. He added, "I have to deal with" the consequences.
After Morsi rescinded the first round of tax hikes on items like cooking oil, alcohol and cigarettes, the government offered a social dialogue on the economy. Gouda predicted some of the taxation measures might be altered after discussion with those involved.
Already the government has introduced a system designed to control the devaluation of the currency, long propped up by foreign currency reserves that are now too depleted to continue. Under an auction system, Egypt's central bank sold $360 million, allowing the currency to lose about 5 percent of its value in recent days
A devaluation has been anticipated as part of the talks with the IMF, but it is likely to further harm Egypt's trade deficit, because the country relies on imports for much of its basic food, including wheat, sugar and tea.
Samer Atallah, a professor of economics at the American University in Cairo, warned of implications from the negotiations for the loan.
"The whole process has been lacking transparency, and they put themselves in a difficult position without the political consensus needed to sell this to the public," he said. "I think austerity measures are extremely difficult to carry out before any elections, even with the Brotherhood's ability to mobilize" voters.
Fady Mohammed, a 21-year-old student who works on awareness campaigns in low-income neighborhoods, said discussions with people there focus on frustration at lack of change in their living conditions, two years after the ouster of Mubarak.
"Many say neither the Brotherhood nor the revolutionaries have done them any good," Mohammed said. "People feel that the government never takes the side of the poor and is more concerned about establishing control."
Gouda had no good news for the impoverished. He said years of poor economic policies were bound to hit Egyptians hard.
"We will have to rely on local civil groups and charities to compensate some of the low-income groups," he said.
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Northern Irish militants seen hijacking flag protests

Pro-British militant groups are instigating riots that have rocked the Northern Irish capital Belfast in the past month, a police officers' representative said on Sunday as officers came under attack again.
The violence stems from protests over the removal of the British flag over Belfast City Hall. It has been among the province's worst since a 1998 peace accord ended 30 years of conflict in which Catholic nationalists seeking union with Ireland fought British forces and mainly Protestant loyalists.
Fireworks, bottles and bricks were flung at officers for a fourth successive night on Sunday although a police spokeswoman said the trouble was not on the scale of the previous night, when police came under attack with petrol bombs and gunfire.
By Sunday, 70 people had been arrested, including a 38-year-old man detained on Saturday on suspicion of attempted murder over the shooting.
Police had said that members of pro-British militant groups helped to orchestrate and had taken part in the first wave of violence in early December. The Police Federation for Northern Ireland (PFNI) said the recent attacks showed this was now clearly the case.
"What it quite clearly demonstrates is the fact that paramilitaries have hijacked this flags protest issue and they have now turned their guns on the police," federation chairman Terry Spence told BBC radio.
"It is very clear that there are leading members of the UVF (Ulster Volunteer Force) who are exploiting this and are organizing and orchestrating this violence against police officers who are out there trying to uphold the law and prevent anarchy on our streets."
Both the UVF and Northern Ireland's other main loyalist militant group, the Ulster Freedom Fighters, ceased hostilities in 2007 and decommissioned their stocks of weapons following the signing of the peace deal.
At least 3,600 people were killed in the 30 years of violence before the 1998 peace deal.
In scenes that recalled that earlier strife, pro-British loyalists began rioting in early December after a vote by mostly nationalist pro-Irish councilors to end the century-old tradition of flying Britain's Union flag from the city hall.
"NO STOMACH FOR THIS"
Analysts said that, although the violence was worrying, the small numbers of protesters indicated they might be unable to develop any strength.
"Clearly the violence is a step up in terms of what's happened more recently but they're simply not getting people out on the street," said Peter Shirlow, a professor at Queen's University who has spoken with protesters in recent days.
"Protestants are annoyed about the flag but they're even more annoyed about the violence. There's no stomach for this, that mass mobilization is just not there anymore."
The police federation's Spence said, however, that it was the most challenging time for police in a decade. Church leaders and community workers held talks behind the scenes on Sunday to try to quell the violence.
Militant Irish nationalists, responsible for the killings of three police officers and two soldiers since an increase in tensions from 2009, have also not reacted violently to the flag protests, limiting any threat to the 15 years of peace.
The British-controlled province's first minister, Peter Robinson, said on Friday that rioters were playing into the hands of nationalist groups who would seek to exploit every opportunity "to further their terror aims".
The moderate nationalist Social Democratic and Labour Party (SDLP) party said on Sunday that shots had been fired using a ball-bearing gun at the house of one its councilors in Belfast, shattering windows.
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Britain's coalition leaders seek to regain voters' trust

LONDON (Reuters) - The leaders of Britain's fractious coalition pledged on Monday to cap the cost of long-term care for the elderly and to improve state pensions in an effort to re-engage with electors midway into their five-year government.
Conservative Prime Minister David Cameron and his Liberal Democrat deputy, Nick Clegg, have seen popular support fall away as voters suffer squeezed incomes and the economy fails to stage a stable recovery from the 2008/2009 financial crisis.
Despite trailing behind the opposition Labour party in polls, the two leaders said their alliance remained "steadfast and united" on its key aim of cutting Britain's deficit and restoring the economy to health.
In a joint statement to mark the halfway point of Britain's first coalition government since World War Two, Cameron and Clegg set out a series of domestic policy initiatives designed to quash talk that the partnership had run out of steam.
"Our mission is clear: to get Britain living within its means and earning its way in the world once again," they wrote in a review of the government's actions since it came to power in May 2010.
Without giving details, they promised to limit the amount the elderly pay for long-term healthcare, to reform state pensions, build more houses, help parents with childcare costs and find ways to boost investment in transport infrastructure.
Labour dismissed the mid-term review as "another relaunch" of the coalition, seen by many at its birth as an unstable marriage between the center-right Conservatives and the smaller center-left Liberal Democrat party.
In spite of sharp differences over issues such as political reform and Britain's relationship with the European Union, the alliance has held together, bound by a joint commitment to an austerity programme that has kept interest rates low.
Political reality has also proved an effective bond, with Clegg's party at risk of a wipeout if they force an early election, after losing the backing of left-leaning voters angry at a partnership that returned the Conservatives to government.
Later on Monday the two leaders will address media at Cameron's Downing Street residence in London, in what is likely to be a somber echo of their relaxed joint appearance in the garden of the same building after sealing the coalition deal.
They will be speaking a day before a parliamentary vote to approve a real-terms cut in unemployment and tax-credit benefits, condemned by Labour, which the coalition believes will enjoy popular support at a time of low or frozen pay rises.
At the weekend, Cameron said he wanted to be re-elected in 2015 and serve another five-year term as prime minister, a move seen as dismissing suggestions that he was tiring of his role, and putting a lid on the ambitions of potential rivals.
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Egypt Copts mark Christmas with fear of future

CAIRO (AP) — Egypt's minority Christians were celebrating their first Christmas after the election of an Islamist president and a new pope — and following adoption of a constitution many argue has an Islamist slant.
Christians gathered in Cairo's main cathedral Sunday for Midnight Mass on the eve of Orthodox Christmas led by their new pope. Pope Tawadros II was elected in November to replace longtime Pope Shenouda III, who died in March after 40 years as the leader of the church.
Islamist President Mohammed Morsi called Tawadros with Christmas greetings and sent one of his aides to the Christmas mass.
Concerned for their future and their ancient heritage in Egypt, some Copts are reportedly considering leaving the country.
As Egypt struggles with the role of religion in society, many Copts are aligning themselves with moderate Muslims and secular Egyptians who also fear the rise of Islamic power.
Amir Ramzy, a Coptic Christian and a judge in Cairo's court of appeals, said Christmas is a chance to retreat and pray for a "better Egypt."
"Christians are approaching Christmas with disappointment, grief and complaints, fearing not only their problems but Egypt's situation in general," Ramzy said. "During the reign of (ousted President Hosni) Mubarak and the (military rulers), mainly Christians were facing problems, but now with the Muslim Brotherhood leaders, each and every moderate Egyptian is facing problems."
In one of his first public messages after his enthronement, Tawadros said the ouster of Mubarak opened the way for a larger Coptic public role, encouraging them to participate in the nation's evolving democracy.
Egypt's Coptic Christians, who make up about 10 percent of Egypt's 85 million people, have long complained of discrimination by the state and the country's Muslim majority. Clashes with Muslims have occasionally broken out, sparked by church construction, land disputes or Muslim-Christian love affairs.
Following the ouster of Mubarak in 2011, sectarian violence rose, and attacks on churches sent thousands of Coptic protesters into the streets. A protest in October 2011 was violently quelled by the country's military rulers, leaving 26 people dead and sparking further outrage.
Ereny Rizk, 34, whose brother George died in that incident, said it was the second Christmas without him, but that the election of a new pope has raised her spirits.
"I felt like he's my father. Having him lessened the severity of my grief," she said. "I definitely thought about leaving the country, but two things stopped me. First the churches and the monasteries in Egypt, our heritage that I'll be missing. Also, I decided not to let my brother's blood go in vain."
The violence has abated, and 2012 was characterized more by the struggle for political and religious rights, said Hossam Bahgat, the director of the Egyptian Initiative for Personal Rights.
"It is not actual frequent sectarian violence, it is fear of further marginalization and second class citizenship," he said, adding that Egypt has been deeply polarized as it drafted the constitution. Christians and liberals walked out of the committee writing it, complaining that their concerns were not being addressed by the Islamist majority.
Youssef Sidhom, the editor of Egypt's main Coptic newspaper, Watani, said Christians are more concerned for the identity of Egypt, saying that legislation based on the new constitution will be focus of attention out of fear of restrictions on the way of life of Christians and their freedom of worship and expression.
"Egypt is stepping into 2013 split and divided between Copts and moderate Muslims on one side confronting political Islam and fundamentalists on the other side," Sidhom said. "It will only be (resolved) through reconciliation, and this is the challenge that we will have to meet."
Ishak Ibrahim, a researcher with EIPR who monitors religious freedom cases in Egypt, said Coptic Christians are facing two new sets of problems: cases of insulting Islam and fear for their life style because of increasingly assertive radical Islamists.
In October, two Coptic boys were put in a juvenile detention after locals accused them of urinating on pages of the Quran, Islam's holy book. It was one in a series of cases against Coptic Christians in the same period, following the fury over an anti-Islam film produced in the United States. The case against the boys was later dropped after mediation.
Ibrahim said some wealthy Copts, who have connections abroad, have temporarily sought to leave Egypt.
"But the majority (of Christians) are also less fortunate," he said. "Like most Egyptians, they are with little education and have difficult economic conditions."
Verna Ghayes, a 21-year old arts student, also noted the deteriorating economic situation. Her father, an architect, lost his job because of a tight market. She felt the hardships, have, in turn, encouraged Christians to seek relief from God.
"With all the unfortunate events that are happening to Egypt, Christians came closer to God, they started to pray more, believing that only God could handle it," she said. "For me that's the good thing, and everything is according to God's plan," she said.
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