The Standard

Week In Review

**** A divided Lebanese parliament postponed a vote to elect president Emile Lahoud's successor for the fourth time since September.

The president's term ends on Friday and observers fear the fermenting political crisis may lead the country to civil war.

**** MTV's new Arabic music video channel, MTV Arabia, began broadcasting in Cairo and Dubai.

Viacom and the Dubai-based Arab Media Group face competition from satellite networks and home-grown channels who have exclusive contracts with artists.

Week In Review

**** UN Secretary General Ban Ki-Moon called the melting Antarctic ice caps an "emergency situation" and urged world leaders to act swiftly in the fight against global warming.

**** Police probed 100 offices across Israel to determine whether Israeli prime minister Ehud Olmert bartered public permits for a discounted price on his home.

The bad press has weakened the prime minister in parliament ahead of the Israeli-Palestinian peace conference scheduled for later this month in Annapolis.

**** Al Gore's investment fund Generation Investment Management forged an alliance with the San Francisco venture capitalist firm KPCB. The investment groups pledged to fund more clean technology start-ups.

**** Iranian officials gave the International Atomic Energy Agency (IAEA) blueprints for making uranium hemispheres -- the key component for nuclear missiles-- a day before an IAEA report to the UN.

The hand-over took place days after British prime minister Gordon Brown suggested his country may bypass the UN in seeking EU-wide sanctions against Iran if Russia and China continue to delay meaningful action in the UN security council.

Week in Review

Victories in Poland Seem Victories For Europe

In Polish parliamentary elections, Donald Tusk's Civic Platform party gained 41% of the vote and looked set to form a coalition with the moderate Polish Peasants Party.

Mr. Tusk vowed to seek broader cooperation with the EU.

This pro-EU stance, should it play out, will differ drastically from the approach of the outgoing nationalist conservative government.

US: We'll Build It, But We Won't Turn It On

****The US announced it would consider delaying "activation" of a planned missile defense system stationed in the Czech Republic and Poland until there was evidence of a missile threat from Iran.

The statement was a response to Russia's continued opposition of the plan on the (quite flimsy) basis that the radar system threatens Russian national security.

Russia Sets the Price of Food

****The Russian government  ordered Russian food retailers to freeze prices on basic types of food including vegetable oil and bread until the end of the year.

Russia is facing fierce food inflation as global demand for basic food staples reaches an all-time high and global supply remains low after a summer of floods and droughts.

EU Grows Weary of Aggressive Russia

**** Document drafts show that European politicians considered calling Russia a "competitor and even opponent" in documents prepped for the EU-Russian summit.

The wording was watered down in later drafts that warn Russia may pursue a foreign policy that will alienate Europe.

Week In Review

****The US, France and Germany are separately taking steps to regulate investments by sovereign wealth funds. Sovereign wealth funds are huge investment funds controlled by foreign governments. Their current value is estimated to be between $1.5 and $2.5 trillion.

****Russian President Putin and Iranian President Ahmadinejad met in Tehran on Tuesday. Their call for diplomatic unity among Caspian nations was widely seen as a geopolitical rebuff to France and the US, who have publicly considered military action as a last ditch means of solving the Iranian nuclear dispute.

****The EU and Russia announced they would jointly appoint a panel of experts to discuss EU energy market reforms proposed by the European commission. The reforms would block out Russia's politically combative natural gas monopoly GazProm from investing deeper into the EU market.

****Russian President Putin announced on state-run television that Russia is planning to substantially upgrade its conventional and nuclear military arsenals. His remarks came on the same day Russia test fired and inter-continental ballistic missile.

Week In Review

Putin Shows His Hand, France Stays Tough on Iran

**** Citigroup and UBS announced large write-downs in assets tied to sub-prime securities.

They are two of many American and European banks who took multi-billion dollar hits on their balance sheets as the sub-prime crisis ripped through global credit markets during the third quarter.

**** Russian President Vladimir Putin accepted United Russia's invitation to head its list of candidates in the 2007 Russian parliamentary 'elections.'

Experts see this as Putin's first step on the road toward preserving his power through the office of prime minister.

**** Russian state-owned oil giant GazProm threatened to cut off Ukrainian gas supplies if the Ukrainian government did not pay a $1.3 billion debt by November.

The announcement was shrouded in confusion.

Analysts saw it as a Russian attempt to complicate the formation of a Tymoshenko-led government on the heels of close parliamentary elections in the Ukraine.

**** French Foreign Minister Bernard Kouchner strongly urged his European counterparts to consider EU-wide sanctions against Iran to halt its "nuclear defiance."

Italy, Austria, and Germany expressed reservations.

Week In Review

Climate Change, A French Hard Line on Iran, and Kazakh Oil

**** Former US President Bill Clinton said that bold investment in technologies for combating global warming  would help US growth.

Mr. Clinton called for US companies to mobilize economic resources on a level not seen since World War II.

****Secretary General Ban Ki-Moon opened the UN Conference on Climate Change with calls for world leaders to take responsibility for reducing carbon emissions.

US President George W. Bush was notably absent.

****France reiterated its tough stance on Iran's nuclear program.

French President Nicolas Sarkozy told the UN General Assemnly that the possibility of an Iranian nuclear weapon was an  "unacceptable risk" that threatens international stability.

****Western companies cringed as Kazakhstan looked set to pass a law that gives the government authority to change or break contracts with foreign energy firms unilaterally.

Week in Review

Bold Moves in Europe, A Bank Run, and A Falling Dollar

****In the UK, hundreds of customers pulled their savings out of Northern Rock after the bank accepted an emergency loan from the Bank of England to raise short-term cash levels.

British depositors relaxed after the UK government announced it would insure all deposits, staving off a crisis.

****French Foreign Minister Bernard Kouchner urged France to prepare for war with Iran before softening his tone a day later in Moscow.

The sly FM stressed that the French position was 'negotiate, negotiate, negotiate' and emphasized that military intervention was a worst-case scenario.

****The European Commission announced energy market reforms that will make it all but impossible for Russian state-owned giant GazProm to buy into the European energy market.

The moves are another example of EU strength in the face Russian attempts to use its leverage over natural gas supplies to win geopolitical concessions.

****The dollar fell to an all-time low against the Euro on the heels of a .5% interest rate cut in the US. Longer-term causes for the dollar's decline appear set in place, and the increasing weakness looks to become a larger geopolitical issue in the weeks ahead.

Week In Reivew: International

**** Chinese censhorship officials announced that two cartoon characters would begin popping up on web users computers screens every half an hour to discourage Chinese citizens from visiting websites that might 'disrupt social stability.'

**** The European Central Bank reduced its forecast for Eurozone growth.

**** The Bank of England and UK government officials publicly criticized banks for the irresposible lending and borrowing practices that made them susceptible to the sub-prime crisis. The BofE announced a 'tough love' approach, pledging it would not cut rates and let the market purify itself, while making some concessions and offering bail out capital.

**** Russia tested what it called the largest non-nuclear bomb in the world to top off a long, hot summer during which it withdrew from a Cold War arms treaty, renewed long-range bomber flights over the North Atlanitc, and introdcued anti-western history textbooks.

**** In other Russia news, Ukrainian President Viktor Yushchenko implicated the Russian government in the election-year poisoning he suffered in 2004.

Week In Review: International

*** Labor Day made it a short week in the US, where economic data continued to suggest the economy was moving toward recession.

*** Sources out of Washington told the Financial Times that the Chinese PLA were very likely to have hacked Pentagon computers, but cyber-spying on the information infrastructure of the US Department of Defense doesn't elicit much of a response from the White House these days.

Perhaps it was busy planning its upcoming war with Iran?

Barnett Rubin thinks so.

*** Across the Atlantic, Russian officials threw a public hissy fit when the EU mentioned the prospect of legislation that would prevent Russian state-controlled corporations from taking over European energy companies.

Later in the week, Russia sent eight bombers up above the Barents sea, apparently just to see if the UK and Norway would pay attention to them. They did, but EU leaders seem a little hush-hush about the group rendez-vous up in the skies.

*** And where would our week have been if we hadn't caught Vladimir Putin shirtless, strolling by an evergreen shielded stream in his crucifix and military fatigues?

Mr. Brown? Ms. Merkel? We're waiting...

Week In Review: US

*** US Attorney General Alberto Gonzales resigned, giving hope to millions of Americans that the Justice Department would cease to be a cesspool of incompetence, inefficiency, and unprofessionalism and somehow bring back integrity to the bruised and battered American system.

*** Markets continued to reel from the unfolding sub-prime credit crisis. The mood grew more pessimistic, as sage economists delcared that the implosion of the US credit market might be a more significant threat to the US economy than terrorism.

*** Will America ultimately go into recession? Does America need a recession? The Economist argued, "yes". And though I debated it so everyone would crack a grin, I agree with them.

*** US presidential candidates submitted foreign policy positions and confirmed (if we are to believe 2Blowhards) that they have absolutely no understanding of the larger international situation. All agreed the terrorists were out to get us. To his credit, Barack Obama seemed to have an actual sense of right and wrong, but no practical ideas.

So what's next?

Word on the street is that US Federal Reserve Chief will cut interest rates to loosen up the credit markets.

But I'm beginning to wonder whether food inflation in the coming months might put him into a pickle.

If you feel like you're reading a different language (don't feel bad, I once felt the same), see a down to earth explanation about how Bernanke and the US Central Bank affect your pocket book in my post on christmas shopping and global warming.