Mahathir warns of a "great" and "long" financial crisis"

Written by Malaysia Chronicle

KUALA LUMPUR — Tun Dr Mahathir Mohamad warned the ongoing global economic crisis will continue long into the future as the West continues spending in a “state of denial.”

The former prime minister said in his blog yesterday that Western countries continue “believing that they can somehow continue to remain rich. They are unable to behave like poor people.”

On the same day Datuk Seri Najib Razak tabled a budget that aims to rein in the deficit to 4.7 per cent, Dr Mahathir said the West “will not recover because they are still in a state of denial.

“They still believe they are rich, as rich as before they plunged into the crisis. They must keep up the big power wealthy country image even if their people have no jobs, riot and protest.

“The great financial crisis will be with us for a long time. Even when it is resolved the aftermath will see slow recovery for the giants of the West,” he wrote.

“How nice it would be if our pocket is picked, we are allowed to print some money to replace what is lost,” he said, mocking the United States’ quantitative easing measures which has seen its federal reserve print US$3 trillion (RM9.5 billion) since the start of the financial crisis in 2008.

“Now Britain is following in the footsteps of elder brother,” he added, referring to the United Kingdom’s recent move to print £75 billion (RM370 billion) to help distressed banks.

The debt crises in Europe and the US have caused the global economy to wobble in recent months and is likely to stunt Malaysia’s export-driven economy in the near future.

Analysts said yesterday that Najib’s prediction of a 5 to 6 per cent growth for 2012 is “too high” which may in turn see Putrajaya fail to meet its deficit forecast.

The prime minister tabled a budget yesterday which saw cash handouts, more money for civil servants, schools and a fund for “high-impact development” projects to put cash in the pockets of voters ahead of a general election expected soon.

Giant Asteroid Vesta Has Mountain Taller Than Anything on Earth

SPACE.com Staff

A NASA spacecraft orbiting the asteroid Vesta is revealing new details about the huge space rock's surface, including a massive mountain that rises taller than Mt. Everest on Earth.

NASA's Dawn probe has been circling Vesta since mid-July, when it arrived in the asteroid belt that orbits the sun between Mars and Jupiter. So far, Dawn has beamed back surprising views of Vesta that revealed an enormous mountain in the asteroid's southern hemisphere and show that its crater surface is incredibly diverse place.

"We are learning many amazing things about Vesta, which we call the smallest terrestrial planet," Chris Russell, principal investigator of the Dawn mission, said in a statement. "Like Earth, Mars, Venus and Mercury, Vesta has ancient basaltic lava flows on the surface and a large iron core … The south polar mountain is larger than the big island of Hawaii, the largest mountain on Earth, as measured from the ocean floor. It is almost as high as the highest mountain in the solar system, the shield volcano Olympus Mons on Mars."

Vesta's giant southern mountain is nearly as tall as Olympus Mons, the largest mountain (and volcano) in the solar system, which soars about 15 miles (24 kilometers) above the surface. On Earth, the largest terrestrial volcano is Mauna Loa in Hawaii, which rises up 6 miles (9 km) high, including the portion of the volcano that extends underwater to the sea floor. Mount Everest, the tallest mountain above sea level on Earth, is a paltry 5.5 miles (8.85 km) tall. [Latest Photos of Asteroid Vesta]

Dawn also revealed that Vesta's surface appears to be much rougher than most asteroids in the main asteroid belt, which is a vast region full of space rocks between the orbits of Mars and Jupiter.

Additionally, preliminary estimates of crater age dates on Vesta suggest that regions in the southern hemisphere are far younger than in the north — with some areas in the southern hemisphere only about 1 to 2 billion years old.

The findings were presented today at the 2011 European Planetary Science Congress and the Division for Planetary Sciences Joint Meeting in Nantes, France.



Dawn at Vesta

The $466 million Dawn spacecraft entered orbit around Vesta on July 15, beginning a yearlong mission to orbit and study the asteroid. After a year of studying Vesta, the Dawn probe is expected to head off to explore Ceres, the largest asteroid in the solar system.

Vesta, which measures about 330 miles (530 kilometers) across, is the second-largest object in the main asteroid belt and is the brightest asteroid in our solar system.

The surface of Vesta provides scientists with clues into the space rock's past. Since July, Dawn has been moving steadily closer to Vesta, transitioning into a polar orbit as it scans the asteroid's surface. In mid-August, the probe mapped the entire sunlit surface of Vesta in visible and infrared wavelengths.

The spacecraft has since moved into a lower orbit and will spend the coming month mapping the asteroid's sunlit surface at a different resolution, said Carol Raymond, Dawn's deputy principal investigator.

Scientists are now closely studying Vesta's craters, ridges and hills, and hope to have the sunlit surface of the asteroid completely mapped by the end of the year, Russell added.

Dawn's framing camera is equipped with seven color filters that collect spectral information that enable scientists to show surface features in false color maps that would not normally be visible to the naked eye. These false colors are ratios of light intensity at different wavelengths, and are indications of different surface materials.

The spacecraft's observations showed particularly strong differences in surface composition around craters. [Dark Feature Spotted on Asteroid Vesta ]

"Data from different wavelengths can be combined to investigate different types of materials," said Maria Cristina de Sanctis, of Italy's National Institute for Astrophysics, which manages Dawn's Visible and Infrared Mapping Spectrometer (VIR). "The color variations seen by VIR suggest variability in the surface mineralogy."

Calculating ages on Vesta

Researchers also said that the difference in the number of craters in the northern hemisphere compared to the southern hemisphere is also striking. The relative ages of the craters and regions can be roughly calculated by counting the number of craters per unit area in the different terrains.

Early estimates show that areas in the south may be much younger than in the north. The oldest ages that have been found in the south so far are younger than 4 billion years old, which was surprising to the researchers since meteorites from Vesta were calculated to be about 4 billion years old.

But, the ages of Vesta's craters should become more precise as Dawn continues its yearlong mapping mission, the scientists said.

"The variation in Vesta's brightness as the sun angle changes indicates that the surface of Vesta is very rough, causing light to scatter," Raymond said in a statement. "This roughness could be at the scales of surface features or at the scale of individual minerals in the rocks, or both. Vesta's roughness is larger than most asteroids in the main asteroid belt."

NASA's Dawn probe has only just begin its mission to map Vesta, and should continue to study the asteroid through mid-2012 before continuing on to its next target: Ceres. Dawn is expected to arrive at Ceres in February 2015.

Iranian Pastor Increasingly Likely to Face Death Penalty Under New Charges

By Perry Chiaramonte

Imprisoned Iranian pastor Youcef Nadarkhani, originally sentenced to death for apostasy and refusing to renounce Christianity, is now in even greater danger of being put to death in light of reports in state-run media of other charges, including being a Zionist and a threat to national security.

"The charge of being a Zionist and thus a traitor is among the most serious accusations that can be made in Iran," said Jordan Sekulow, executive director of the American Center for Law and Justice, or ACLJ. "Unfortunately, we know that this is the charge Iran levies to justify executing people who were actually arrested, imprisoned and tried on completely different charges."

In a ruling from the Iranian Supreme Court obtained by FoxNews.com, Nadarkhani was sentenced to execution by hanging for breaking Islamic law by conducting Christian worship and baptizing himself and others.

Nowhere in the ruling is there a mention of these new charges, which were first reported by Iranian news agency FARS.

Nadarkhani’s lawyer, Mohammed Ali Dadkhah, says he has not received any of these new charges from the Supreme Court, according to the ACLJ.

“The opinions of these new charges come from the political branch. Not a single judicial figure, a prosecutor or member of the court has spoken to these new charges,” Dadkhah said through a translator.

Fox News reported last week that the pastor, who also held house church services in Iran, was facing execution after being convicted of apostasy last November.

He appealed his conviction all the way to the Iranian Supreme Court.

His appeals trial began last month in Gilan Province and he refused to renounce his religion, according to rights groups monitoring the trial.

The European Center for Law and Justice, an affiliate of the ACLJ and an non-governmental organization with consultative status at the U.N., is looking at taking action at the United Nations this week.

"We have not seen any new charges from the court," an official for the U.S. State Department said. "We continue to seek additional information."

Pressure building for Iran to overturn death sentence on Christian pastor

National Post Wire Services

International pressure is growing on Iran to overturn a death sentence imposed on a Christian pastor for apostasy.

Pastor Youcef Nadarkhani, a member of a Protestant evangelical church in the Islamic republic, faces death by hanging for refusing to abandon his Christian faith.

The 34-year-old pastor of the Church of Iran was born a Muslim but became a Christian after his 19th birthday.

Under Iran’s version of sharia law that makes him an apostate — Muslims cannot renounce the faith into which they were born.

According to an unofficial translation, the court’s judgment said, “He has frequently denied the prophethood of the great prophet of Islam and the rule of the sacred religion of Islam. And he has proven his apostasy by organizing evangelistic meetings and inviting others to Christianity, establishing a house church, baptizing people, expressing his faith to others and denying Islamic values.”

The New Statesman website said the judgment concluded Mr. Nadarkhani “will be executed by being hung until somehow his soul is taken from him.”

At a hearing in his hometown of Rasht, a city on the shores of the Caspian Sea in northwestern Iran, on Sunday, Mr. Nadarkhani said he had no intention of returning to Islam, the Daily Mail reported.

“Repent means to return. What should I return to?” he asked. “To the blasphemy that I had before my faith in Christ?”

However, the court said because the man has Islamic ancestry, he therefore must “recant his faith in Jesus Christ.”

When the court ordered him to “return to the religion of your ancestors — Islam,” Mr. Nadarkhani replied, “I cannot.”

On Thursday, William Hague, the British Foreign Secretary said, “I deplore reports that Pastor Youcef Nadarkhani, an Iranian church leader, could be executed imminently after refusing an order by the Supreme Court of Iran to recant his faith.

“This demonstrates the Iranian regime’s continued unwillingness to abide by its constitutional and international obligations to respect religious freedom.”

In Washington, the Obama administration also condemned the action and called for Mr. Nadarkhani’s release.

“The United States condemns the conviction of Pastor Youcef Nadarkhani. A decision to impose the death penalty would further demonstrate the Iranian authorities’ utter disregard for religious freedom,” White House spokesman Jay Carney said.

“Pastor Nadarkhani has done nothing more than maintain his devout faith, which is a universal right for all people.”

EU foreign policy chief Catherine Ashton said, “I call for Mr. Nadarkhani’s immediate and unconditional release.” Meanwhile, Poland summoned Iran’s ambassador to demand a stay of execution.

Mr. Nadarkhani’s lawyer, Mohammad Ali Dadkhah, said he was “optimistic” the pastor would be freed soon, despite admitting, “Mr. Nadarkhani did not repent and the last court verdict said he would face a death sentence if he did not.”

He insisted, “However, we offered our explanations and I think the court was convinced. I am optimistic there is a 95% chance he will be released in the final ruling, which I expect by the end of next week.”

Iranian authorities are concerned about the spread of other faiths in the country in which the vast majority of people are Shiites. There are thought to be about 100,000 Christians and 350,000 Baha’i out of a population of about 78 million.

Mr. Nadarkhani, a married father of two, was arrested in 2009 when he tried to register his church.

Supporters say he did not want his son to be educated Islamically, which is mandatory in Iran.

He was initially charged with protesting, but the charges were later upped to apostasy and evangelizing Muslims, both of which carry the death penalty.

The pastor was spared by a supreme court appeal ruling in July, his lawyer said, but was again condemned to death after the case was reheard.

The pastor’s wife, who was initially sentenced to life imprisonment, was released on appeal.

There are reports Iran has detained other Christian leaders — Behnam Irani, who was convicted of leading church services in Christian homes; Matthias Haghnejad, who was arrested last month, but the charges against him are not known; and Behrouz Sadegh-Khandjani, pastor of a church in Tehran.

The Road from Depression

by George Soros

NEW YORK – Financial markets are driving the world towards another Great Depression with incalculable political consequences. The authorities, particularly in Europe, have lost control of the situation. They need to regain control, and they need to do so now.

Three bold steps are needed. First, the governments of the eurozone must agree in principle on a new treaty creating a common treasury for the eurozone. In the meantime, the major banks must be put under the direction of the European Central Bank in exchange for a temporary guarantee and permanent recapitalization. Third, the ECB would enable countries such as Italy and Spain temporarily to refinance their debt at a very low cost.

These steps would calm the markets and give Europe time to develop a growth strategy without which the debt problem cannot be solved. Indeed, the importance of developing a growth strategy cannot be overstated, because the debt burden – the ratio of debt to annual GDP – rises and falls in part as a function of the rate of economic growth.

Since a eurozone treaty establishing a common treasury will take a long time to conclude, in the interim the member states must appeal to the financial authority that already exists, the ECB, to fill the vacuum. In its current form, the embryo of a common treasury – the European Financial Stabilization Facility – is only a source of funds; how they are spent is left to the member states. Enabling the EFSF to cooperate with the ECB will require a newly created intergovernmental agency, which will have to be authorized by Germany’s Bundestag and perhaps by other eurozone members’ parliaments as well.

The immediate task is to erect the necessary safeguards against contagion from a possible Greek default. Two vulnerable groups – the banks and the government bonds of countries like Italy and Spain – need to be protected.

To accomplish these related tasks, the EFSF would be used primarily to guarantee and recapitalize the banks. Systemically important banks would have to agree with the EFSF to abide by the ECB’s instructions as long as the guarantees are in force. Banks that refuse would not be guaranteed, but enough would agree to provide the ECB with the required critical mass.

The ECB would then instruct the banks to maintain their credit lines and loan portfolios while closely monitoring the risks they run for their own accounts. These arrangements would stop the concentrated deleveraging that is one of the main causes of the crisis. Completing the recapitalization would remove the incentive to deleverage, at which point the blanket guarantee can be withdrawn.

To relieve the pressure on the government bonds of countries like Italy, the ECB would lower its discount rate. It would then encourage the countries concerned to finance themselves entirely by issuing treasury bills – and encourage the banks to buy them. The banks could rediscount the bills with the ECB, but they would not do so as long as they earned more on the bills than on the cash.

These measures would allow Greece to default without causing a global meltdown – which does not mean that Greece would be forced into default. If Greece met its targets, the EFSF could underwrite a “voluntary” restructuring at, say, 50 cents on the euro. The EFSF would have enough money left to guarantee and recapitalize the European banks, and it would be left to the IMF to recapitalize the Greek banks. How Greece fared under these circumstances would be up to the Greeks.

I believe that these steps would bring the acute phase of the euro crisis to an end by staunching its two main sources (weak banks and vulnerable sovereigns) and reassuring the markets that a longer-term solution is in sight. The longer-term solution itself would be more complicated because the regime imposed by the ECB would leave no room for fiscal stimulus and the debt problem cannot be resolved without growth. How to create viable fiscal rules for the euro would be left to the treaty negotiations.

Many other proposals are under discussion, because officials now realize that “kicking the can down the road” has brought them to the end of the highway. Most of these proposals seek to leverage the EFSF by turning it into a bank, an insurance company, or a special-purpose vehicle that takes the riskier tranche of a public-private partnership. While practically any proposal is likely to bring temporary relief, the financial markets are just as likely to see through them and find them wanting, especially if they violate Article 123 of the Lisbon Treaty (the no-bailout clause), which my proposal scrupulously respects. That said, some form of leverage could be used in recapitalizing the banks.

The course of action outlined here does not require leveraging or increasing the size of the EFSF. But it is more radical, because it puts the banks under European control. That is liable to arouse the opposition of both the banks and national authorities – opposition that only public pressure can overcome.


George Soros is Chairman of Soros Fund Management and of the Open Society Institute.