Friday, September 14, 2007


US President George W. Bush will one day be tried in court just like deposed Iraqi dictator Saddam Hussein for his involvement in the Iraq tragedy, said Iran's supreme leader Friday.

Iran's supreme leader Ayatollah Ali Khamenei, 2nd left, and Iran's army commander Ataollah Salehi, right, in Tehran.
Photo: AP

Speaking to thousands of worshippers during the first Friday prayer of the Muslim holy month of Ramadan, Iran's supreme leader Ayatollah Ali Khamenei said that Bush will be called to account for the US-led invasion of Iraq.

"A day will come that the current US president and officials will be tried in an international supreme court for the catastrophes they caused in Iraq," he said.

"Americans will have to answer for why they don't end occupation of Iraq and why waves of terrorism and insurgency have overwhelmed the country," he added. "It will not be like this forever and some day they will be stopped as happened to Hitler, Saddam and certain other European leaders."

Khamenei mocked the US, describing the recent congressional testimony of the top US officials in Iraq as a sign of weakness and the failure of American policy in the war torn country.

"More than four years have past since the occupation of Iraq and today everyone knows that American has failed and is frantically looking for a way out," he said.

In their testimony Gen. David Petraeus and Ambassador Ryan Crocker raised allegations of Iranian meddling in Iraq by financial and military supporting militias and insurgent groups, warning that the US was already embroiled in a proxy war with the Islamic republic.

Despite UN sanctions and efforts to isolate Iran internationally, the country is flourishing, maintained Khamenei.

"Today we are in a better political position compared to four to five years ago," he said. "We have moved forward economically and the spiritual preparedness and happiness of our nation has improved."

"A nation like ours, without an atomic bomb and not as wealthy as these other powerful governments, has foiled a whole series of their conspiracies and forced them to give up and withdraw," he added.

The US accuses Iran of secretly trying to develop nuclear weapons and has called for further international sanctions against the country.

Iran and the US have not had diplomatic relations since Washington cut its ties with Tehran after Iranian students stormed the US embassy there in 1979.


Thu Sept 13 2007 12:30:11 ET

Former Federal Reserve Chairman Alan Greenspan admits he "didn't really get it" that the subprime lending trend was significant enough to hurt the economy until very late 2005, but still defends his lowering of interest rates from 2001 until 2004 that critics say caused the crisis in the first place. Greenspan, who led the U.S. Federal Reserve Bank through 18 years and four presidents, speaks to Lesley Stahl in his first major interview, to be broadcast on 60 MINUTES Sunday, Sept. 16 (7:00-8:00 PM, ET/PT) on the CBS Television Network.

Greenspan says he knew about the questionable subprime lending tactics that gave loans to homebuyers and investors with low adjustable interest rates that could rise precipitously, but not the severe economic consequences they posed. "While I was aware a lot of these practices were going on, I had no notion of how significant they had become until very late," he tells Stahl. "I really didn't get it until very late in 2005 and 2006."

Even though one of the Federal Reserve governors raised a red flag on those lending practices, Greenspan says there was little he could do. "Well, it was nothing to look into particularly because we knew there was a number of such practices going on, but it's very difficult for banking regulators to deal with that," says Greenspan.

Several of Greenspan's former Federal Reserve governors have since said that Greenspan's policy of lowering interest rates for three consecutive years early in the decade was wrong because it opened the door for the subprime lenders. They think he kept rates too low for too long. "They are mistaken," Greenspan tells Stahl. "It was our job to unfreeze the American banking system if we wanted the economy to function. This required that we keep rates modestly low," he says.

Some believe today's market slide -- U.S. stocks have lost significant ground over the past few months -- could have been slowed had the current Federal Reserve Chairman Ben Bernanke lowered interest rates like Greenspan did early in the decade. Would he act as dramatically and quickly now as he did then if he were the current chairman as some believe? "I'm not sure that's true," says Greenspan. "We were dealing in an environment back there where inflation was easing. We could have acted without the fear of stoking inflationary pressures. You can't do that anymore... I'm not certain I would have done anything different [if he was the chairman today]," he tells Stahl. "I think [Bernanke] is doing an excellent job."

British mortgage lender hit by panic withdrawals

by Ben Perry 2 hours, 20 minutes ago

LONDON (AFP) - Anxious customers of bank Northern Rock rushed to withdraw their savings on Friday, forming queues in front of branches after the lender was bailed out by the Bank of England.

The central bank came to the rescue of Britain's fifth-biggest home loan provider, which said it was facing severe difficulties raising cash to cover its liabilities amid the ongoing global credit squeeze.

From London to Edinburgh, panicking customers were pictured on British television channels crowding outside Northern Rock branches to withdraw their savings.

Shares in the group, which issued a profits warning on Friday, plunged 31.77 percent to 436 pence nearing the close, dragging the European banking sector lower as investors fretted over potential difficulties elsewhere.

International ratings agency Standard and Poor's cut its rating on the company and warned of further downgrades if credit conditions worsened.

But analysts forecast that the troubled bank was very unlikely to go bust despite the appearance of a "bank run."

A bank run is when customers withdraw their savings en masse because of fear a lender will become insolvent, which can cause it to go bankrupt.

"Northern Rock's problems are a consequence of its particular reliance on the money markets to fund its mortgage activities," said Global Insight economist Howard Archer.

"Furthermore, all of the indications are that it is in no danger of going bust and that it has a good quality loan book."

S & P said that the bailout by the Bank of England "considerably strengthens Northern Rock's funding and liquidity."

Northern Rock is the first major British financial institution to be severely hit by the credit crunch sparked by the US home loan crisis.

A global credit crunch erupted last month, sparked by a crisis in the US subprime, or high-risk, mortgage sector.

Banks became nervous about lending to each other because of fears about bad investments linked to US home loans, leading to a shortage of cash for lending purposes.

Central banks around the world have pumped billion of dollars of emergency funds into the banking sector to enable banks to continue normal lending practices.

The Bank of England said it had made available an unspecified amount of cash to Northern Rock in the form of a liquidity facility.

This "will be available to help Northern Rock to fund its operations during the current period of turbulence in financial markets while Northern Rock works to secure an orderly resolution to its current liquidity problems," the bank said.

A Northern Rock spokesman sought to reassure customers, saying that "savings customers' deposits are safe" adding that "there will be no impact on our borrowers."

However, many customers were simply ignoring similar assurances from government ministers and Bank of England (BoE) officials.

"I have withdrawn all my money," said one worried customer who wished to remain anonymous outside a branch in Harrow, north west London.

"I know everyone has been urged not to panic but I just felt safer moving the money somewhere else rather than worrying about Northern Rock's financial position over the next few days," she added.

Another customer added: "I'm not sure about this, even though they say it is going to be all right.

"If they are short of funds, what happens to our funds?"

As well as hitting lenders globally, the world credit squeeze played a major part in the dollar slumping to a record low against the euro this week, and caused stock markets to plunge earlier this month.

Northern Rock warned Friday that its 2007 profits could be 147 million pounds (214 million euros, 297 million dollars) lower than expected, sending its share price plunging by nearly a third in London trading.

"It will be a slog after a day like this to repair the bank and we are up for the slog," Northern Rock chief executive Adam Applegarth told Sky News.

Britain's finance minister Alistair Darling, who authorised the BoE to help the bank, said its problems might have been avoided had US banks not been so willing to offer cash to borrowers with poor credit histories.

Darling said it had been "some time" since the Bank of England had been placed in such a situation, while some commentators suggested it last occurred about 30 years ago.

"My objective all the time is not just to have a strong and stable economy but to ensure we've got stability in the banking system," Darling told BBC radio.

"That is why I authorised the Bank of England to provide that support for Northern Rock, it was the right thing to do."

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