Factbox: New U.S. budget panel, same problems on taxes, spending

Factbox: New U.S. budget panel, same problems on taxes, spending Thu, Oct 17 15:53 PM EDT WASHINGTON (Reuters) - Another U.S. budget deal, another special committee in Congress to find future budget savings. The creation of this latest panel is a fundamental part of the emergency law signed by President Barack Obama early on Thursday to end a 16-day federal government shutdown and avoid a default on Washington's debt. Reminiscent of the 2011 "supercommittee" that failed to agree upon one penny's worth of deficit-reduction - much less the $1.2 trillion in savings over 10 years it was tasked to identify - this newly formed group is hoping to arrive at a happier outcome. Some lawmakers have suggested a modest compromise of perhaps a few hundred billion dollars is achievable, but there is still skepticism about its chances of success. The Republican and Democratic negotiators from the House of Representatives and Senate have less than two months to bridge deep divisions over taxes and spending that have been festering for years. The new law requires the panel to report a budget plan by December 13. For those who are superstitious, it is worth noting that is a Friday. Government funding runs out again on January 15, providing a new shutdown threat as an incentive. Here are some of the deficit-cutting ideas the committee is likely to consider: ENTITLEMENT REFORMS AND OTHER SPENDING The long-term costs of Social Security, Medicare and Medicaid are rising sharply as an aging U.S. population increasingly draws benefits from these retirement and healthcare programs, ballooning projected deficits in the next decade and beyond. A major hang-up of past budget fights: Many liberal Democrats fought entitlement savings, saying they will hurt the elderly and poor. Obama has argued that if the poor and middle class shoulder some of the deficit reduction burden, so should the rich through higher taxes, which Republicans oppose. Obama's budgets have proposed hundreds of billions of dollars in relatively modest savings that were never taken up by Congress. House Budget Committee Chairman Paul Ryan, a member of the new negotiating panel, has his own more dramatic proposals for savings. Among ideas that have been floated: using a less generous inflation measure to hold down benefits growth, means testing to require the wealthy to contribute more towards their elderly health coverage, paring doctors' payments, reducing military medical and retirement benefits as well as prescription drug coverage. Farm subsidies and some higher education grants have also been discussed as cuts from automatic spending programs. TAX REFORMS Tax-writing committees of Congress have been looking at comprehensive reforms for years. Republicans want to simplify the tax system. By eliminating deductions and credits and using the savings to reduce individual and corporate tax rates, they hope to spark an explosion in growth that will fill federal coffers and eliminate deficits. Democrats back the overall approach, but many say that Washington needs to collect more taxes from the wealthy, on top of the tax increase on individual income above $400,000 and on capital gains that they won in last January's fiscal cliff fight. In past negotiations between Obama and House Speaker John Boehner, the two talked about additional tax revenues of around $800 billion. But that was before the January tax increase. Since then, Boehner has insisted on no more revenue increases. Eliminating all sorts of tax breaks could be debated, from imposing new taxes on healthcare benefits to ending deductions and credits for corporate jets and oil drilling to home mortgage interest. The U.S. tax code, last revamped in 1986, is an outdated, sprawling behemoth riddled with "loopholes" and it is unlikely this committee can accomplish a total rewrite in two months. But some hope the special panel can provide some directions that the Senate Finance Committee and House Ways and Means Committee could build upon early next year. AUTOMATIC SPENDING CUTS Democrats hate automatic spending cuts. So do some influential Republicans such as House Appropriations Committee Chairman Harold Rogers and those who support strong military spending. Tea Party activists love them. The $1.2 trillion in across-the-board cuts over 10 years started phasing in early this year because of the failure of the supercommittee to find more targeted savings. Among ideas that have circulated: Give federal agencies more flexibility in carrying out the automatic cuts; exempt the military from some or all of the cuts; replace them with savings from mandatory programs or tax increases discussed above. OBAMACARE After Republicans failed in their efforts to use the government shutdown and debt limit deadlines to delay core parts of Obama's signature healthcare reform law, some are looking to the budget panel as the next round in their fight against Obamacare. They argue that it is an expensive new federal benefit with $1 trillion in new outlays over a decade, and is already costing jobs and raising insurance premiums, hurting economic growth. Democrats claim that the program is already contributing to a slowdown in the growth of healthcare costs and point to Congressional Budget Office estimates that, overall, it will reduce deficits by $165 billion over 10 years and by more than $1 trillion in the subsequent decade. Problems with the launch of new Obamacare insurance exchanges will influence the debate. ECONOMIC GROWTH, INTEREST COSTS Senate Democrats have proposed new spending on infrastructure projects as a means to jolt an anemic economy into a higher level of job growth. Creating more jobs will generate more tax revenues to shrink deficits, but Republicans are in no mood for more stimulus. Democrats are more likely to argue in favor of solutions that emphasize near-term growth, such as turning off the sequester spending cuts, which the CBO projects will cost around 600,000 jobs through the end of 2014. Interest costs remain a wildcard in any budget solution to be considered by the committee. House Budget Chairman Ryan notes that unless some serious new budget cuts are achieved, Washington could get socked with higher interest costs that blow up deficits and spiral out of control in future years as the interest rates rise from historically low levels. These rates would have shot up much higher, much faster had a failure to lift the debt ceiling thrown the U.S. Treasury into default. (Reporting By Richard Cowan and David Lawder; Editing by Karey Van Hall and Cynthia Osterman)

Laura Hallam I think the global economic decline spear headed by the States is wonderful stuff. First and foremost it will stop rampant consumerism, ensure that be get back to our base values and live within our means. Will also stall the raping and pillaging of our planet, stop the absolute reliance on the dollar and level the playing field that other global players can see their day. Frankly, it allows all of us to become decent human beings who live our lives with empathy - something that is very lacking currently. So I sit and smile and wait for when the cards come tumbling down for the States. America was a country that I always aspired to live in, at least for a couple of years. Now... no thank you!!

Doha News A highly anticipated, Qatar-backed development in the American capital of Washington, DC will include a cultural center run by the Gulf country when it opens next year, Qatar Foundation International has said. The $1 billion CityCenterDC, one of the largest construction projects on the American east coast, is primarily financed by Qatar, and considered the country's first major real estate investment in the US... Qatar to establish ‘Al-Bayt’ cultural center in American capital By: Shabina S. Khatri | 54 mins agoView as "Clean Read" | 0 Comments Email 118 A highly anticipated, Qatar-backed development in the American capital of Washington, DC will include a cultural center run by the Gulf country when it opens next year, Qatar Foundation International has said. The $1 billion CityCenterDC, one of the largest construction projects on the American east coast, is considered Qatar’s first major real estate investment in the US. The country became involved in the development in 2010, when the Qatari Diar Real Estate Investment Co. put up some $622 million in financing. When completed, CityCenterDC will take up three pedestrian city blocks in downtown Washington and include two condominium buildings, two rental apartment buildings, two office buildings, a luxury hotel, a park, a plaza and an underground public parking garage. Al-Bayt Construction on the project began in 2011, and CityCenterDC already has a bit of the Qatari touch. According to the Washington Post, the investment made by the Qatari Diar, an extension of the country’s sovereign wealth fund, was sharia-compliant. Thus, the development will not lease to any bars, though some restaurants will be granted alcohol licenses. This week, QFI announced that it will establish a cultural center within the 10-acre, mixed-use urban village called “Al-Bayt,” or “home.” In a statement quoted by the Post, Maggie Mitchell Salem, executive director of the foundation, said the center was “designed to increase knowledge and understanding of Arabic language and culture in the America.” The newspaper continues: The foundation’s real estate adviser, Audra Cunningham, vice president at CBRE, said the cultural center would provide a little bit of everything that Qatari culture has to offer. “You will walk into that space and get very familiar with their art, their language and their cuisine,” she said. Meanwhile, even though apartments at the development go for a whopping $2,000 to $7,700 a month, tenants are already lined up to rent, according to developer Hines Interests LP. Residents are expected to begin moving in next month, and the project should be completed early next year. Thoughts?

Minibus blast kills 21 in southern Syria: activists

Wed, Oct 16 10:13 AM EDT BEIRUT (Reuters) - Twenty-one people, including four children and six women, were killed when a minibus hit a mine in the southern Syrian town of Noa on Wednesday, the Syrian Observatory for Human Rights monitoring group said. Opposition activists told the Observatory the minibus drove over a mine planted by forces loyal to President Bashar al-Assad. There was no immediate comment from the government. The explosion was reported in rebel-held territory in Deraa province but there are also army troops in the nearby base of Tel al-Jumaa, which is besieged. Assad's forces are battling an uprising that grew out of protests against his family's four-decade grip on the country. Violence has continued in recent days despite pleas from Arab and Muslim organizations for a ceasefire to mark the Muslim festival of Eid al-Adha. The British-based Observatory, which is opposed to Assad, reported clashes in most provinces on Wednesday and said warplanes had been deployed to the eastern desert city of Deir al-Zor. The group said at least 27 government soldiers had been killed during intense clashes in Deir al-Zor over the past two days although rebels gave a figure more than double that. Pro- and anti-government militias have fragmented the country into fiefdoms, with hardline Islamist rebels fighting Kurds and other opposition groups. The Observatory reported that 29 jihadist fighters, some from the al Qaeda-linked Islamic State of Iraq and the Levant, and 12 Kurdish militants were killed during clashes on Tuesday in the northeast province of Hasaka. It is increasingly difficult for international aid workers to operate in the lawless rebel-held northern provinces. Six Red Cross workers and a colleague from the Syrian Arab Red Crescent were abducted on Sunday after delivering medical supplies in the northern province of Idlib. Four were released the next day. Aid workers say the Damascus government has also placed barriers on working in Syria such as rejecting visas or preventing convoys from entering certain areas. Syrians complain aid is not getting through to many areas of the country, especially to residents living in rebel-held territory who say the government is restricting access. ICRC spokesman Ewan Watson said that his group was asking "all authorities for access" to the besieged town of Mouadamiya southwest of Damascus, where he estimated 10,000 civilians were trapped. "We are concerned about the situation in the besieged town of Mouadamiya, under siege for 10 months. We have not been able to enter and suspect there are medical care needs and possibly of essential aid like food and water," he said in Geneva. (Reporting by Oliver Holmes in Beirut and Stephanie Nebehay in Geneva; Editing by Andrew Roche)

Losing faith: Global financiers look to de-Americanize

RT A US debt default could hit on Thursday, and world leaders are second guessing the dominant role America plays in finance. Regardless of the final decision in Washington, confidence and credibility in the US has already eroded. RT This week, the US may be forced to default on its $16.8 trillion debt if a deal to raise the ceiling is not struck. And some US legislators are acting “irrationally” enough to indeed allow it to happen, Professor Jeffrey Sommers told RT. Published time: October 14, 2013 11:44 Get short URL Mark Wilson/Getty Images/AFP Share on tumblrTags Crisis, Currencies, Economy, USA A US debt default could hit on Thursday, and world leaders are second guessing the dominant role America plays in finance. Regardless of the final decision in Washington, confidence and credibility in the US has already eroded. In an editorial published by the Chinese state-owned press agency Xinhua, a columnist says the US economy has ‘failed’ and put many countries who hold state assets in dollars, at risk. “To that end, several corner stones should be laid to underpin a de-Americanized world,” the editorial read. Last week China, the biggest US creditor, started to make preparations for a technical default on loans. The European Central Bank and the People’s Bank of China (PBC) have agreed to start supplying each other with their currencies, avoiding the dollar as an intermediary currency. The currency swap agreement will last for three years and provide a maximum of 350 billion Yuan ($56 billion) to the ECB and 45 billion euro ($60.8 billion) to the PBC. In a further sign of growing distrust, China introduced a so-called “haircut”, or a discount, on the value of US Treasuries held as collateral against futures trades. Developing and developed nations are equally concerned, and institutions like the World Bank and the International Monetary Fund (IMF) have issued several warnings. Christine LaGarde, managing director of the IMF told the US they must uphold their financial promises to the international community and raise their debt ceiling. Failing to do so would put the world “at risk of tipping yet again into a recession,” LaGarde said in an interview on NBC’s ‘Meet the Press’, which aired on October 13. “You have to honor your signature, … give certainty to the rest of the world,” LaGarde urged the US, a strong supporter of the international lending tool. The country that has long provided a sturdy backbone to the global economy is now teetering on a mass default. If US lawmakers don’t forge a solution to raising the debt ceiling by October 17, investors with US treasury bonds, one of the lowest-risk assets, could suffer. “It’s not just China that’s at the mercy of US lawmakers, its everybody in the world that is at the mercy of US lawmakers right now,” David Kuo, Investment Advisor, Motley Fool told RT . “China is trying to diversify away from US Treasuries,” said Kuo, adding investors “cannot just assume an asset is 100 percent safe.” China holds nearly $1.3 trillion in Treasuries, Japan has $1.14 trillion, and other big foreign creditors include Caribbean creditors, Brazil, Taiwan, Russia, and European nations. Other creditors have decided to keep calm. Russia, ranked the 11th on the list of the US top creditors with the estimated $132 billion in US Treasuries, plans to keep their Treasuries. "I don't see the need for revising our reserve investment strategy in US Treasuries," Russian Finance Minister Anton Siluanov said at a press conference on October 11 following a meeting of the G20 finance and Central Bank chiefs. “What’s happening now, I hope, is a fairly short-term situation,” Siluanov told reporters, noting Russia’s investment plan is long-term. If the US misses the debt ceiling deadline of October 17 and stops paying their creditors, it would be the first major Western government to do so since Nazi Germany under Hitler in 1933, which wasn’t able to pay their debts following World War I. The US has a bank holiday today in honor of Columbus Day; however, after making little headway on solving the budget gap, both the Senate and the House will hold sessions on Monday. For Republicans, Obamacare has been a major stumbling block in agreeing to raise the debt ceiling, as they see the legislation as antithetical to their ‘small government’ philosophy. ================ U.S. Senate leaders are “making progress” in their bid to resolve Washington’s latest fiscal crisis but still seek agreement on two key points - length of an increase in the debt limit and a funding bill to reopen the government, a Democratic aide with knowledge of the talks said on Oct. 14. The Treasury says it cannot guarantee that the U.S. government will be able to pay its bills past Oct. 17 if Congress does not raise the $16.7 trillion debt ceiling by then. It would bring global trouble “in a way you couldn’t possibly understand,” says Jamie Dimon. Debt ceiling holdouts in D.C. suggest otherwise. But they’re wrong. Financial markets are a confidence game, and there’s solid recent evidence of what happens when confidence collapses. It would bring global trouble “in a way you couldn’t possibly understand,” says Jamie Dimon. Debt ceiling holdouts in D.C. suggest otherwise. But they’re wrong. Financial markets are a confidence game, and there’s solid recent evidence of what happens when confidence collapses. A U.S. debt default would “ripple through the global economy in a way you couldn’t possibly understand,” says Jamie Dimon, chief executive of JPMorgan. Lawmakers in Washington resisting an increase in the federal borrowing limit suggest otherwise. But they’re wrong. The Treasury has said it will start running short of cash on Thursday if frantic efforts by the White House and Congress don’t resolve the political impasse soon. That doesn’t mean it will stop servicing America’s $16.7 trillion of debt immediately. But that’s not really the point. The market reaction will come whenever investors switch from incredulity ((the state or quality of being incredulous; disbelief)) to believing American leaders might actually allow that to happen. Immediate consequences will probably echo the situation when the Reserve Primary money market fund broke the buck in 2008, marking its net asset value down from the traditionally unquestioned $1 a unit after being stuck holding Lehman Brothers debt. Broader short-term funding markets worth trillions of dollars, which rely on Treasury bills as a kind of currency, will start seizing up as cautious participants worry they aren’t worth their face value – the article of faith that keeps these markets liquid. In the highly interconnected world of finance, that will spark fears about financial institutions’ liquidity, further freezing funding markets and bringing crippling margin calls, which is what occurred after Lehman’s collapse five years ago. Meanwhile, instead of a downward spiral centered on dodgy bonds in one segment of the mortgage market, investors everywhere will be forced to assume all U.S. government debt obligations are in question. They will sell off dollar assets and seek relatively safe alternatives like yen, Swiss franc and euro-denominated paper. Text - Members of Congress might react to the first signs of meltdown. After all, lawmakers passed the Troubled Asset Relief Program bank bailout in October 2008 after first rejecting it and seeing stocks decline by 7 percent in an instant. But by then, borrowing costs will be higher across the board and they may not fully settle back. Higher debt costs could dent the fragile improvement in the housing market and slow economic recovery in general. Text - Lawmakers may reach a last-minute deal, and anyway what would follow a default isn’t exactly predictable. But events wouldn’t be as hard to understand as Dimon suggests. He could easily have explained: financial markets are a confidence game, and there’s solid recent evidence of what happens when that confidence collapses. Text - Lawmakers may reach a last-minute deal, and anyway what would follow a default isn’t exactly predictable. But events wouldn’t be as hard to understand as Dimon suggests. He could easily have explained: financial markets are a confidence game, and there’s solid recent evidence of what happens when that confidence collapses. ================ Asian shares head to 5-mth highs on hopes for U.S. deal Tue, Oct 15 03:06 AM EDT 1 of 9 By Lisa Twaronite and Dominic Lau TOKYO (Reuters) - Asian shares rose to their highest in nearly five months on Tuesday on heightened hopes for a deal in Washington to reopen the U.S. government and avert a possible debt default, though investors remained wary with the deadline just days away. European shares were expected to follow suit, with financial spreadbetters predicting Britain's FTSE 100, Germany's DAX and France's CAC 40 would all open up around 0.5 percent. "The sudden the u-turn in sentiment has seen the bears blindsided," Capital Spreads trader Jonathan Sudaria wrote in a note to clients. While investors expect U.S. politicians will reach a deal before Thursday's deadline to raise the U.S. debt ceiling to allow the country to meet its obligations, avoidance of a worst-case scenario of a default is far from assured. There were positive signals from negotiations between Democrat and Republican Senate leaders, but any deal would still need approval in the House of Representatives, where it is unlikely to sail past conservative Republicans. MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.9 percent to its highest since May 23. Several markets in the region were closed for holidays, including Singapore and Indonesia. Japan's Nikkei share average rose 0.3 percent to its highest close in two weeks, but ended off session highs as traders waited to see if U.S. politicians could strike a deal. "The market is still precarious," said Takuya Takahashi, an analyst at Daiwa Securities. "Even if default can be avoided, investors are not ready to take risk at this point." Citigroup Inc and State Street Corp have been exploring ways in which they might impose limits on the use of short-term treasury bills due in the coming weeks as collateral, the Wall Street Journal reported, citing people familiar with the matter. Against a basket of major currencies, the dollar was up slightly, moving away from an eight-month low hit after the U.S. government shutdown started earlier this month. The dollar bought 98.41 yen, slightly down on the day but recovering from a low of 98.05 hit on Monday. It also drifted lower to buy $1.3569 against the euro. The fiscal plan being discussed by U.S. senators would raise the $16.7 trillion debt ceiling by enough to cover the country's borrowing needs at least until mid-February, according to a source familiar with the negotiations. It would also fund government operations until the middle of January, though some fear that would just set the stage for another standoff then. "U.S. policymakers are just kicking the can and we will have another showdown in January. Under such circumstances, it would be difficult for the Fed to reduce its stimulus," said Masafumi Yamamoto, forex strategist at Praevidentia Strategy. U.S. S&P 500 E-mini futures were slightly higher on Tuesday, indicating a firmer open if the gains were to be maintained. U.S. Treasury futures slipped 11 ticks. In the commodity markets, gold slipped about 0.2 percent to $1,269.70 an ounce. U.S. crude slipped 0.3 percent to $102.10 a barrel, giving up some of Monday's gains as traders bought contracts to cover short positions ahead of a possible deal in Washington. (This story has been fixed to remove reference to India in list of markets closed for holidays) (Additional reporting by Ayai Tomisawa and Hideyuki Sano in Tokyo; Editing by John Mair) =================

Deflated expectations

Cooper-Apollo spat forces investors to pick lanes 14 October 2013 | By Una Galani, Peter Thal Larsen How it works By Una Galani and Peter Thal Larsen This interactive calculator considers four outcomes in Apollo Tyres' $2.5 billion bid for Cooper Tire & Rubber. One possibility is that the offer goes ahead at the agreed price of $35 per Cooper share. Alternatively, the deal could fail. Cooper shares would then fall to their pre-bid level, minus a discount for the damage suffered by Cooper's China joint venture. However, Apollo and Cooper could also renegotiate the deal. The calculator considers two outcomes: one where Apollo pays the same 40 percent premium to Cooper's reduced standalone value, and one where it pays a premium of just 20 percent. Based on the likelihood of each scenario, the calculator computes at a probability-weighted share price for Cooper. Users can change the probabilities in blue, provided the the total adds up to 100%. The resulting share price is displayed in red. For more interactive calculators and agenda-setting comment visit: www.breakingviews.com Cooper Tire & Rubber has won a fast-track handling of its complaint against India’s Apollo Tyres, paving the way for the case to be heard in early November. The U.S. company filed a complaint against Apollo in a Delaware court on Oct. 4 seeking to compel the Indian buyer to complete its agreed $35-per-share acquisition. The $2.5 billion transaction faces grievances from U.S. steelworkers and employees at Cooper’s joint venture in China. Apollo is seeking a reduction in the acquisition price by around $3 per share, according to a person familiar with the company. Cooper shares closed at $25.81 on Oct. 11. Investors in Cooper Tire & Rubber are being forced to pick lanes. Legal wrangles have put Apollo Tyres’ agreed $2.5 billion offer for its U.S. rival in doubt, and tensions at its China joint venture have undermined Cooper’s value. But a negotiated price reduction still looks possible. Cooper shares may be pricing in too much bad news. Cooper shareholders must choose between four broad outcomes. The least likely is that the deal goes ahead on the agreed terms of $35 per share. Apollo has made it clear that it would like a lower price. Its lenders are also getting cold feet. If the deal falls apart, Cooper shares might be expected to fall back to their pre-bid price of $24.50. But the wrangle with Apollo has exposed the U.S. company’s less-than-firm grip on its Chinese joint venture, which contributes around a quarter of its parent’s revenue and earnings. Assume the subsidiary’s value is reduced by 25 percent, and Cooper’s standalone value drops by $100 million, equivalent to $23 a share. There is room for negotiation between these two extremes. One possibility is that Apollo adjusts Cooper’s value to reflect the reduced value of the Chinese business and then applies the same 40 percent premium as before. In that case, Cooper shareholders would receive around $32 a share. Apollo might, however, seek to pay a lower premium. Say it offers just 20 percent more than Cooper’s reduced standalone value. Shareholders would then be presented with an offer worth just $28 a share. Investors are taking a dim view. Take Cooper’s closing share price of $25.81 on Oct. 11. One way of interpreting that number is that investors think there is zero chance of the deal going ahead at the original price, a 60 percent probability of failure, and just a 20 percent possibility of either renegotiation scenario proving correct, according to a Breakingviews calculator. The longer the dispute drags on, the greater the damage to Cooper’s value. But that also makes it more likely that the U.S. company renegotiates with Apollo – or finds another bidder. Cooper shareholders aren’t attaching much probability to that lane providing an exit from the current mess.

Cyclone Phailin pounds India, rescue workers start to assess damage

Cyclone Phailin pounds India, rescue workers start to assess damage Source: Reuters - Sun, 13 Oct 2013 03:42 AM Author: Reuters * Cyclone Phailin kills at least five people * Operations at port halted; major gas field spared By Jatindra Dash and Sruthi Gottipati BHUBANESWAR/SRIKAKULAM, India, Oct 13 (Reuters) - Cyclone Phailin powered its way inland over eastern India on Sunday leaving a swathe of destruction but the loss of life appeared limited after more than half a million people sought safety in storm shelters. Phailin was the strongest storm to hit India in 14 years. Torn branches littered a road running past destroyed huts and twisted electricity poles along a large stretch of the east coast. At least five people were killed - four people by falling trees and one when the walls of her mud house collapsed as the storm roared in off the Bay of Bengal, authorities said. The cyclone was one of three major storms over Asia on Sunday. The smaller Typhoon Nari was approaching Vietnam and Typhoon Wipha loomed over the Pacific. More than half a million people in India spent the night in shelters, some built after a storm killed 10,000 people in 1999. Others took refuge in temples. By first light, winds had slowed to 90 kph (56 mph) from top speeds of 200 kph (124 mph) when the storm made landfall near the town of Gopalpur in Odisha state on Saturday night. Television images showed cars flipped on their sides and debris-strewn streets in the silk producing city of Brahmapur, one of the hardest hit. A few trucks and motor-bikes returned to the city's streets as residents emerged to survey the damage. Large swathes of Odisha, including its capital, were without electricity for a second day after the storm ripped down power cables, and officials said it was too early to give an accurate damage assessment. "We will assess after the cyclone eases ... even now the cyclone is on," said Odisha's chief secretary J.K Mohapatra. "There has been pretty severe devastation in Brahmapur town." EXTENSIVE FLOODING Soldiers and rescue workers in helicopters, boats and trucks will fan out across Odisha and neighbouring Andhra Pradesh state to review the damage. The India Meteorological Department warned of extensive flooding and destruction of flimsy homes. Higher sea levels driven by storm surges can cause the worst destruction. Phailin was forecast to drive sea levels up 11 feet (3.5 metres) at its peak. At least 550,000 people were crammed into shelters including schools and temples, in what the National Disaster Management Authority called one of India's largest evacuations. In Mogadhalupadu, a fishing village in Andhra Pradesh, where some people had refused to leave their boats and nets, the damage was less than feared. Seawater surged into huts made from coconut palms near the beach. "People have come back to the village now," said village chief Jagdesh Dasari, saying winds that gusted through the night had dropped off and the rain was light. Operations at Paradip port in Odisha have been halted since Friday. All vessels were ordered to leave the port, which handles coal, crude oil and iron ore. An oil tanker carrying 2 million barrels of oil, worth $220 million, was moved. The storm landed far north of India's largest gas field, the D6 natural gas block in the Cauvery Basin further down the east coast, operated by Reliance Industries.

Malala: The real story (DNA Report: Malala is not Pushtun), the girl in the hospital was not a girl at all. It was a pillow.

Nadeem F. Paracha Updated at2013-10-10 16:47:58 In September 2012, a 15-year-old school girl from Pakistan’s Swat valley was reported to have been shot in the face and head by a Taliban activist. The attack caused outrage around the world and the news was given widespread coverage in the local and international media. Malala was reported to have barely survived after doctors in Pakistan and then England performed multiple surgeries on her face and head. Today Malala lives in the UK and has repeatedly vowed to continue working for the cause of women’s education in Pakistan, especially in those areas of the country where extremists and militant outfits are said to have been blowing up girls’ schools. But this is just one side of the whole story. The narrative about what really happened on the day Malala was allegedly shot has mostly been weaved by the Western media. In April this year, Dawn.com sent a group of its most seasoned reporters to Swat to undertake an intensive five-month investigation of the event. Their collective findings unearthed a series of some stunning disclosures (with evidence) that are bound to affectively challenge the mainstream narrative of the Malala story. The following are the major findings of the investigation: • Malala was not born in Swat and neither is she a Pushtun. A respected medical doctor in Swat, Imtiaz Ali Khanzai, who runs a private hospital and clinic in Swat told our reporters that he has a DNA report that proves that Malala is not Pushtun. Showing us the report, he said he extracted Malala’s DNA when as a child she visited his clinic (with her parents) complaining of an earache. “After she was supposedly shot last year, I remembered I had a bottle where I had kept some of her earwax,” the doctor explained. “Collecting earwax of my patients is a hobby of mine,” he added. He went on to claim that according to the DNA, Malala is a Caucasian, most probably from Poland. After the discovery, the doctor called Malala’s father and told him that he knew who Malala was. “ “He was stunned and began to stutter,” the doctor said. “He pleaded that I did not make my findings public. I told him I wouldn’t but only if he told me the whole truth.” Malala’s father told the doctor that Malala’s real name was Jane and she was born in Hungary in 1997. Her real biological parents were Christian missionaries who, after traveling to Swat in 2002, left Malala as a gift to her adopted parents after they secretly converted to Christianity. Dr. Khanzai’s DNA extraction kit Dr. Khanzai’s DNA extraction kit When our reporters asked the doctor why he was revealing Malala’s real identity now, he said he was convinced that Malala was planted in Swat by anti-Pakistan elements. He then added that he can also prove that the young man who shot her was not a Pushtun either. “I have his earwax as well,’ he claimed. After extracting the DNA of the shooter’s earwax, the doctor discovered that he was probably from Italy. He then invited our reporters to look at the man’s earwax under a microscope. “Those tiny yellow bits that you see in the wax are bits of pizza,” he explained. The doctor told us that in January 2012 he emailed his findings to some senior members of Pakistan’s intelligence agency, the ISI. After a few days his clinic was raided by the police. He was in Saudi Arabia at the time collecting earwax samples of some members of the Saudi royal family. His staff at the clinic was harassed by the police who wanted to know where he kept the earwax samples. Pizza? Pizza? In June this year, the doctor was visited by a young ISI officer who apologised to him about the police raid and told him that the ISI were well aware of Malala’s real identity. After much coaxing on our part, the doctor eventually gave us the cell phone number of the ISI officer. However, the officer kept refusing to talk to us but finally relented on the condition that we refer to him as ‘Master X’. Master X met one of our reporters at an abandoned girls’ school in lower Swat. To hide his face, the officer wore a Spiderman mask. Talking to the reporter he said: “This had to come out one day. And I just couldn’t let myself continue to keep such a dangerous secret hidden. I am a true patriot.” He then added: ‘My father once told me, ‘Peter, with great power comes great responsibility’.’ The officer The officer His revelations led us to our next shocking discovery (with evidence): • Malala’s shooting was staged by intelligence agencies. The officer told the reporter that the whole shooting incident was a stunt planned by Pakistani and US agencies to pave the way for the Pakistani army’s invasion of North Waziristan: “It was all a drama,” he explained. “It was staged so the Pakistan army would have an excuse to invade North Waziristan.” When asked why he was using the word ‘invasion’ when North Waziristan was a part of Pakistan, the officer replied: “North Waziristan is an autonomous Islamic Emirates. It has been like that for centuries. But our history books distort the facts and teach our children that it is part of Pakistan. The area has unimaginable amounts of oil, gold, copper, silver, bronze, coal, diamonds, gas and fossilised dinosaur remains underneath its rugged grounds. That’s what the Americans are after.” Our reporter then asked whether he had any evidence to prove his claim. The officer pulled out a few photographs and showed it to the reporter. The photographs showed a few bones. “Dinosaur bones,” he explained. He added: “These were excavated in North Waziristan by the archaeology division of the Taliban. After they were studied by the geology division of the Taliban, it had traces of oil, gold, copper, silver, bronze, coal, diamonds and gas.” One of the photographs showing dinosaur bones excavated from the grounds of North Waziristan. One of the photographs showing dinosaur bones excavated from the grounds of North Waziristan. What about the evidence proving that the shooting was staged by American and Pakistani agencies? Pulling out a piece of paper, the officer said: “This is the evidence. It was decoded by the Taliban’s division of quantum physics.” The paper had screen shots of a brief exchange of tweets on Twitter between one ‘Lib Fish’ and ‘Oil Gul.’ The officer said that Lib Fish was actually a CIA operative based in Qatar and Oil Gul was an ISI sleuth on Twitter based in Lahore. The exchange was intercepted and decoded by one ‘Tsunami Mommy’ who is based in Swabi in the Khyber Pakhtunkwa province in Pakistan and is an engineer by profession. We are publishing the Twitter exchange between Lib Fish and Oil Gul that was provided to us by the officer: @LibFish Yo, @OilGul, how goes life? @OilGul Life’s kool, mate. @LibFish @OilGul Any chance of visiting Qatar soon? @OilGul @LibFish Haha. Soon after I’m done with my O level exams. They suck. @LibFish @OilGul Haha. Yea, they do, don’t they? The officer told us that Tsunami Mommy jumped in after he realised what was taking place: @Tsunami_Mommy Agents! I know what you two do. Anti-Islam anti-Pakistan bastaaas. @OilGul @LibFish @OilGul Dude, who are you? Why are you trolling us? @Tsunami_Mommy Shup ut fake liberalz fascist agents IK is best you bastaaas NA250 rigging 1 billion fake liberalz votes anti-Pakistan anti-Islam inshallah Nya Bakistan tabdeeli … The officer said he used famous Pakistani linguist and WW-II code-breaker, Mustansar Hussain Tarar, to decode the suspicious Twitter exchange and that is when he discovered that the CIA and the ISI were planning the fake shooting. He also gave the reporter the manuscript of the book that Tsunami Mommy was writing on the shooting after piecing together the evidence (with evidence) provided by the doctor, the officer and Mustansar Hussain Tarar. The book’s title will be ‘A Fake Shooting of a Fake Liberal by a Fake Liberal, You Bastaaas.’ Below is the brief summary of what the manuscript claims: October 1, 1997: Malala is born to Hungarian parents in Budapest and named Jane. October 4, 2002: The parents are recruited by the CIA and given a crash course in evangelical Christianity, hypnosis and karate. October 7, 2003: They land in Pakistan and head for Swat posing as NGO workers. They get in touch with a low-level ISI agent, and convert the family to Christianity, leaving Jane with him. He changes her name to Malala and instils in her the fear of Jesus. October 30, 2007: Malala starts to write a blog that asks the militants of Swat to put down their weapons, pick up a Bible and boogie. October 21, 2011: The militants request her to stop writing her evangelical blogs and finish her homework instead. October 1, 2012: CIA recruits a Pashtu speaking Italian-American loner (Robert) living in New York and gives him a crash course in gun-slinging and acting. October 7, 2012: CIA shares plan of Malala’s fake shooting with the ISI. The ISI agrees and gives Malala and her parents a briefing. October 11, 2012: The Italian-America arrives in Swat posing as an Uzbek homeopath. The fake gunman moments before taking a flight to Pakistan. The fake gunman moments before taking a flight to Pakistan. October 12, 2012: Robert is given a gun that is loaded with blanks. He intercepts Malala’s school van and fires blanks at her. She pretends to be hit and squeeze opens a small pack of Mitchel’s Tomato Ketchup she is hiding in one of her hands and rubs the ketchup all over her face. A fake ambulance suddenly arrives on the scene and takes away Malala. The world is told that she was shot in the face and head by a Taliban fanatic. The story that ran in the media quoted Malala’s friends in the van saying that the gunman asked for Malala and then shot her. But the officer shared with us the testimony of one of Malala’s friends that was repressed by vested interests in the media. According to the testimony, a man stopped the van and shouted (in Pashtu), ‘who is Jane … I mean, Jeanette … no, Alberta Joan Lucas?’ The girls looked at each other in confusion and the driver was about to drive away when the gunman pulled out a gun and started to shout: ‘Uno momento, un momento …’ Then looking at a girl he asked: ‘You lookin’ at me?’ At which Malala threw down her school bag and shouted (in Italian): ‘No you idiot, I AM lookin’ at you. Malala, Malala, remember? Fool.’ Saying, ‘Oh,’ he shot her (with the blanks). • The girl that the media was shown in the hospital was not Malala. The officer shared with us some photographs to prove this. He first showed us a video (on his iPhone) that he shot hours after the shooting. It shows Malala joyfully bungee jumping on the hills near River Swat. Malala bungee jumping hours after she was allegedly ‘shot.’ Malala bungee jumping hours after she was allegedly ‘shot.’ Then the officer informed us that the doctor had the earwax samples of the girl in the hospital. When we contacted the doctor again and asked what the samples proved he said that the DNA he extracted from the sample suggests that the girl in the hospital was not a girl at all. It was a pillow. He said he had managed to sneak into the operating room (posing as a postman) and while he was secretly drawing out earwax from the girl’s ears, he managed to take a picture of the girl with his Nokia phone. ‘I came back and was shocked when I enlarged the picture,’ he said. He then gave us a printout of the picture … We believe there is now enough evidence for Pakistan and the international community to have a serious re-look at the Malala story and demand that the United Nations orders a full investigation into the matter. ======================================================================================== Malala Inc: Global operation surrounds teenage activist By AFP Published: October 11, 2013 Share this article Print this page Email. Malala Yousufzai at the UN General Assembly. PHOTO: AFP LONDON: Teenage activist Malala Yousafzai has become a formidable force for rights in the year since the Taliban shot her, but an equally formidable public relations operation has helped her spread her message. The 16-year-old campaigner for girls’ education has been nominated for the Nobel Peace Prize, addressed the UN, published an autobiography and been invited to tea with Queen Elizabeth II, achieving a level of fame more like that of a movie star. On Thursday she won the EU’s prestigious Sakharov human rights prize Thursday, drawing a fresh threat of murder by the Taliban. But Malala and her family have help when it comes to balancing her recovery and her schooling with the demands of being a young stateswoman in demand from the international media. One of the world’s biggest public relations firms, Edelman, has a team working on her behalf while politicians, journalists and book publishers are making her into something of a global brand. Those close to Malala reject claims from some in Pakistan that she is being manipulated. “I was worried about all the expectations placed on her before I met her,” Jonathan Yeo, a British painter whose portrait of Malala went on display in the National Portrait Gallery in London in September, told AFP. “A lot of people wouldn’t want to deal with it, or have the presence of mind to deal with it, or be swayed by the things around it,” said Yeo. “But my worries that any of those things might be going on were immediately reassured by her and her family.” He added: “There’s no one with any ulterior motives, all the money is going to charity, there is no political agenda, she is still devoted to her country and still religious.” A source who worked with the family told AFP: “From what I have seen, although she is only 16 it is very much driven by her personally.” Malala had already been in the public eye for years before a Taliban gunman boarded her school bus on October 9, 2012, asked “Who is Malala” and shot her in the head. It was Malala’s father Ziauddin, a school principal and himself a seasoned campaigner for education, who first helped propel the precociously talented girl from the Swat valley into the limelight. At his encouragement Malala started writing a blog for the BBC’s Urdu service under a pseudonym in 2009, when she was aged just 11, about how the Taliban were banning girls’ education in Swat. The New York Times filmed a documentary about her that same year. But it was only after the shooting, and Malala’s subsequent miraculous recovery in a British hospital, that she became a truly global figure. Former British prime minister Gordon Brown, a UN special education envoy, visited her in hospital shortly afterwards and took up her cause with a petition which he presented to the Pakistani government. Brown later arranged for Malala to speak at the United Nations in July. Behind the scenes Brown was also helping Malala and her family come to terms with their new reality. “He has quite a close relationship with the family, particularly Malala’s father,” a source close to Brown told AFP, adding that Brown and his wife Sarah were helping the family with “things that have been fairly overwhelming”. At the request of Malala’s father, Brown also personally asked consulting firm McKinsey to lend employee Shiza Shahid, a friend of the Yousafzai family. to chair the Malala Fund, the organisation that runs Malala’s education campaign and has won donors including Angelina Jolie. The Malala machine really grew in November 2012 when the PR agency Edelman, whose clients include Starbucks and Microsoft, started working for her family. A spokesman for Edelman told AFP it was carrying out the work on a pro-bono basis and now had a team of five people supporting Malala. Edelman said its role “primarily involves providing a press office function for Malala” and “helping to advise the family on how to engage with the huge media and public interest in Malala’s campaign.” There is now a two-month waiting list for an interview with Malala, the firm said. The global spotlight has provoked a backlash in parts of Pakistani society, with some accusing Malala of acting as a puppet of the West while the Taliban have renewed the threat to her life. Elsewhere there have also been concerns at the level of public exposure. “It could be a burden. Imposing that on a child might not be ethical,” said Tilman Brueck, the head of Stockholm peace research institute SIPRI. Malala herself insists the circus around her has not affected her personality. “My world has changed but I have not,” she says in her autobiography “I Am Malala”. ==============================================================