Ahmadinejad: Iran will respond 'decisively' to U.S., Israel attacks

Iranian president tells Russia Today news network that although Iran would retaliate harshly in the event of attack, there is no reason to launch a strike against the Islamic republic.

By Haaretz

Iranian President Ahmadinejad warned that he would respond harshly to any attempts by Israel or the United States to launch a war against the Islamic republic in an interview with Russia Today news network on Saturday, saying Iran would give a “decisive response” to any strike.

“We have a saying in our language: If someone throws a smaller stone (at you), you should respond with a bigger stone,” the Iranian president said, adding, “we will defend ourselves within our capabilities.”

Ahmadinejad told the Russian news network that the U.S. and Israel “wish to do it (launch an attack against Iran), they want to do it, but they know about our power. They know that we are going to give them a decisive response.”

Despite this warning, the Iranian leader expressed hope in the interview that such a reality would never materialize, claiming there is no reason to launch a strike against Iran.

Ahmadinejad then went on to accuse Israel of being a regime that depends on terror, occupation and aggression.

The international community has called on Iran to halt its nuclear program, leveling sanctions against the Islamic country, however, Iran claims the program is for peaceful purposes and continues to enrich uranium.

Earlier this year, former Mossad head Meir Dagan said that an air force strike against Iran's nuclear installations would be "a stupid thing."

Dagan claimed that Iran has a secret infrastructure for its nuclear program which is working in parallel with the legitimate, civilian program, but only the latter is under international inspection.

"Any strike against that [the civilian program] is an illegal act according to international law," Dagan said. Dagan says that contrary to the situation in Iraq in which the nuclear plant of Saddam Hussein was bombed in 1981, Iran has dispersed its nuclear sites across the country, making an effective attack difficult. He added that Iran has a proven ability to move its nuclear infrastructures from place to place, in order to hide them from international inspectors and intelligence services.

"If someone in Iran decides to build a laboratory for centrifuges [for uranium enrichment] in the basement of some school he has no problem doing this," Dagan said.

Dagan warned that an air force strike against Iran has "potential for significant complications and it is best to avoid war(s) with non-beneficial results and also those with no lasting effect. It is important to remember that war is only one option among many alternatives."

'You Need This Dirty Word, Euro Bonds'

In a SPIEGEL interview, billionaire investor George Soros criticizes Germany's lack of leadership in the euro zone, arguing that Berlin must dictate to Europe the solution to the currency crisis. He also argues in favor of the creation of euro bonds as a way out of the turbulence.

SPIEGEL: Mr. Soros, we currently see a global banking crisis, a currency crisis and a sovereign debt crisis. Has the financial dilemma become too big to handle? How can politicians on both sides of the Atlantic be expected to solve such a multitude of crises?

Soros: The politicians have not really tried to fix any crisis; they have so far tried only to buy time. But sometimes time actually works against you if you refuse to face the relevant issues and explain to the public what is at stake.

SPIEGEL: Are you talking about the Germans? Many experts think Chancellor Angela Merkel has been particularly hesitant to address the euro crisis.

Soros: Yes. The future of the euro depends on Germany. This is the point I really want to drive home. Germany is in the driver's seat because it is the largest country in Europe with the best credit rating and a chronic surplus. In a crisis, the creditor always calls the shots. Sure, this is not a position Germany or Chancellor Merkel ever desired and they are understandably reluctant to embrace it. But the fact is that Germans are now in the position of dictating to Europe what the solution to the euro crisis is.

SPIEGEL: Why should Berlin embrace that idea?

Soros: There is simply no alternative. If the euro were to break up, it would cause a banking crisis that would be totally outside the control of the financial authorities. So it would push not only Germany, not only Europe, but also the whole world into conditions very reminiscent of the Great Depression in the 1930s, which was also caused by a banking crisis that was out of control.

SPIEGEL: What, then, needs to be done to fight this crisis?

Soros: I think there is only one choice. It is not a question of whether Europe needs a common currency. The euro exists, and if it were to break apart, all hell would break loose. Germany has to make it work. To make it work, you have got to allow the members of the euro zone to be able to refinance the bulk of their debt on reasonable terms. So you need this dirty word: "euro bonds". But when you study what it involves to have euro bonds, you really have a problem because each European country remains in control of its own fiscal policy, and you have to rely on the country to meet its financial obligations.

SPIEGEL: Germans hate the euro bonds idea. They fear that under this scenario they will ultimately need to bail out everyone, even large nations like Italy.

Soros: That is why you need to establish fiscal rules that will ensure the solvency of every member. This should make the euro bond acceptable to German voters. Europe needs a fiscal authority that has not only financial but also political legitimacy. The difficulty is agreeing on the rules. Unfortunately, Germans have some funny ideas. They want the rest of Europe to follow their example. But what works for Germany can't work for the rest of Europe: No country can run a chronic surplus without others running deficits. Germany must propose rules that other countries can also follow. These rules must allow for a gradual reduction in indebtedness. They must also allow countries with high unemployment, like Spain, to continue running cyclical budget deficits until they recover.

SPIEGEL: More and more economists, especially in Germany, would like to see Greece leave the European Union. Do you consider that to be a viable option?

Soros: I think that the Greek problem has been sufficiently mishandled by the European authorities that this may well be the best solution. Europe, the euro and the financial system could survive Greece leaving. It could survive Portugal leaving. And the remainder would be stronger and more easily managed. But the financial authorities have to arrange for an orderly exit in order for the European banking system to survive it. That will cost money because the European banking system including the European Central Bank has to be indemnified for its losses. Depositors in Greek banks also need to be protected. Otherwise, depositors in Irish or Italian banks will not feel safe.

SPIEGEL: Is the current crisis even worse than the one in 2008?

Soros: This crisis is still the continuation of the same crisis. In 2008, the financial system collapsed and it had to be put on artificial life support. The authorities managed to save the system. But the imbalances that caused the crisis have not been removed.

SPIEGEL: What do you mean?

Soros: The method the authorities rightly chose three years ago was to substitute the credit of the state for the credit in the financial system that collapsed. After the failure of Lehman Brothers, the European financial ministers issued a declaration that no other systemically important financial institutions would be allowed to fail. That was the artificial life support; it was exactly the right decision. But then Chancellor Merkel stated that such support would only be granted by each EU member state individually, and not by the European Union.

SPIEGEL: That undermined the concept of a strong European response to the crisis. Has that been the biggest mistake so far?

Soros: That Merkel statement was the origin of the euro crisis. It shattered the vision that the EU will protect the euro in a joint effort.

SPIEGEL: Where will the current crisis stop? Even France now seems to be threatened by a financial meltdown.

Soros: Of course it is spreading. Markets fear uncertainty. Germany has to realize that it has no alternative but to defend the euro. The longer it takes, the higher the price Germany will have to pay.

SPIEGEL: You have been very critical of how the crisis has been handled by governments. Many European citizens, however, blame speculators like you for their attempts to bring down the euro. Huge hedge funds like yours have waged massive bets against the European currency over the past year. And in recent days, several European countries have even imposed temporary bans on short selling, bets on falling share prices.

Soros: You are confusing markets and speculators. At the moment, the biggest speculators are the central banks because they are the most important buyers and sellers of currencies. Hedge funds have definitely been supplanted by central banks. Markets expect the authorities to produce a financial system that actually holds together. If there is any hole in that system, speculators will rush through that hole.

SPIEGEL: That sounds very noble. But in reality, speculation makes any crisis worse. Look at the credit default swaps (CDS) market where speculators can bet on a further decline of currencies and economies. How can that be helpful?

Soros: Of course, speculation will always make a crisis worse. If there is a weak point, it will expose it. And you are right, the CDS market is a very dangerous instrument and I think it should not be allowed. I am one of the very few people who argue that the CDS is a dangerous instrument because it is so lop-sided in favor of a negative outcome.

SPIEGEL: Do you think the European Central Bank is part of the solution or part of the problem when it comes to the dealing with the euro crisis?

Soros: It is part of the solution, but which part? Any central bank should only be in charge of liquidity. Solvency is a matter for the treasury. But because there is no European treasury, the ECB was pushed into that arena. To keep the financial system alive they overstepped their limits, as the former German Bundesbank president Axel Weber pointed out, by discounting the government bonds of a country that was clearly bankrupt.

SPIEGEL: You are referring to the purchase of Greek bonds. Now the European Central Bank even started buying Spanish and Italian bonds. It is not even clear, however, if it is legally allowed to do so.

Soros: Yes, but there is a well-established conviction that the central banks always do what is necessary to keep the system going and then afterwards you then take care of the legal aspects. In a crisis, you simply do not have time to think about such concerns for too long.

SPIEGEL: The United States is drowning in even more debt than Europeans. Its economic recovery has been painful. Are we going to see a double-dip recession in the US?

Soros: The indebtedness of the US is not all that high, but if a double-dip recession was in doubt a few weeks ago, it is less in doubt now, because financial markets have a very safe way of predicting the future. They cause it. And the markets have decided that America is going to see a recession, particularly after the recent downgrade of the US by the rating agency Standard & Poor's.

SPIEGEL: President Barack Obama has been fiercely criticized for his handling of the economy. You were one of his biggest supporters in 2008. Are you happy with his economic policy?

Soros: No, of course not. But the reality is that we have had 25 years of excesses building up in America -- a combustible mix of too much credit and too much leverage. You need a long time to reverse that.

SPIEGEL: Obama tried to stimulate growth with a gigantic stimulus program which increased the national debt further. Was that a mistake?

Soros: Obama embraced the ideas of John Maynard Keynes. Basically, the analysis of Keynes is still very relevant -- with one big difference between now and the 1930s. In the 1930s, governments had practically no debt and could therefore run deficits. Nowadays, all governments are heavily indebted, and that is a big change.

SPIEGEL: If Keynes were still alive, would he adjust his theory?

Soros: Definitely. He would say governments can still benefit from running fiscal deficits, but the new debt has to be invested in a way that will pay for itself. So the money spent would have to increase productivity.

SPIEGEL: The $800 billion stimulus program launched by Obama did not live up to that?

Soros: Obama's stimulus program was not big enough and it was not directed at improving infrastructure nor human capital. So it was not productive enough.

SPIEGEL: And any further stimulus is now basically a non-starter, because the conservative majority in Congress is hell-bent on preventing it.

Soros: That is what is pushing the world towards another recession, into a double dip.

SPIEGEL: The Republicans are doing that?

Soros: Yes, but Obama is also at fault. He yielded the agenda to the Republicans. He is talking their language. The president would have to show leadership to counter the Republican wave, and so far he has not done so.

SPIEGEL: Do you think the US deserved the recent downgrade by Standard & Poor's?

Soros: Probably not. This decision was the attempt by the rating agencies to reinvent themselves as anticipating rather than responding to changes that have occurred. So they are really basing that downgrade on the expectation that the political process will not provide the solution. Judging such political developments is a very new role for the rating agencies, though.

SPIEGEL: As an investor, do you listen to the rating agencies?

Soros: Well, I do not, but many other investors do.

SPIEGEL: The credit rating agencies are accused of exacerbating the crisis. Do you think the role of the rating agencies in the financial system needs to be scaled back?

Soros: I do not have an answer to that.

SPIEGEL: There are no alternatives.

Soros: Frankly. It is an unsolved problem in my mind

SPIEGEL: As an investor, would you still bet on the euro?

Soros: I certainly would not short the euro because China has an interest in having an alternative to the dollar. You can count on China to back the efforts of the European authorities to maintain the euro.

SPIEGEL: Is that the reason why the euro is still so strong compared to the dollar?

Soros: Yes. There is a mysterious buyer that keeps propping up the euro.

SPIEGEL: And it is not you.

Soros: It is not me (laughs).

SPIEGEL: In the end, will China be the only winner in this crisis?

Soros: China, of course, has been the great winner of globalization, and if globalization collapses, the Chinese will also be among the losers. So they have a strong interest in preserving the current global system. However, in some ways, they have been just as reluctant to accept it as the Germans. Germans have been hesitant to accept responsibility for Europe, and the Chinese have been hesitant to accept responsibility for the world. But they are both being pushed into it.

SPIEGEL: Mr. Soros, we thank you for this interview.

Interview conducted by Gregor Peter Schmitz and Thomas Schulz

First-ever animal with artificial information in its genetic code is created by scientists

By Daily Mail Reporter

The world’s first animal with artificial information in its genetic code has been created by scientists.

The technique could throw open the possibility for scientists to create new, man-made properties in a wide range of animals.

Using this method, scientists could be granted ‘atom-by-atom control’ over molecules in living things.

Researchers from Medical Research Council Laboratory of Molecular Biology in Cambridge modified the genetic code of nematode worms, 1mm long invertebrates with just a thousand cells in their transparent bodies.

The team proved their results using a fluorescent dye - the artificial protein they introduced into the worms’ DNA contained a fluorescent dye that glows cherry red under ultraviolet light.

For the method to have worked, the protein should be replicated in every cell of the worms’ bodies, so that the worms light up completely under the rays.

If the technique failed, there would be no glow.

All living creatures contain DNA in each of their cells, which acts as a blueprint to determine the organism’s characteristics.

This DNA is made of strings of simpler building blocks called amino acids, which, depending on their combinations, make the different proteins needed to sustain life.

There are just 20 different amino acids in all living organisms, but their different combinations result in tens of thousands of different proteins.

However, scientists Sebastian Greiss and Jason Chin included a 21st, man-made amino acid which is not found in nature, in the nematode worms’ DNA.

This is the first time a man-made amino acid has been introduced into the DNA of an animal.

Dr Chin of the Laboratory of Molecular Biology says the method is ‘potentially transformational’.

Researchers could now be able to create designer proteins entirely under their control.

The work builds on techniques first developed at the Scripps Research Institute in the U.S., where Dr Chin worked a decade ago.

Here researchers found a way to include an unnatural amino acid into a living organism.

However, researchers only got as far as introducing the artificial amino acid into bacterium E. coli.

It is only now that scientists have succeeded in introducing one into a whole animal.

Dr Mario de Bono also at the Laboratory of Molecular Biology and an expert on this species of worm, believes this approach could be used to introduce other amino acids into the animals that could be controlled by light.

Meanwhile, the two scientists are now planning to collaborate on a study of neural cells in the nematode brain, aiming to activate or deactivate neurons with tiny laser flashes.

The study appears in the Journal of the American Chemical Society.

Now, Ezam says "burn" was only symbolic, calls Tsu Koon "bodoh"

Written by Melissa Lee, Malaysia Chronicle

Now, UMNO Senator Ezam Mohd Nor says his threat to “burn” two news portals for maligning JAIS was merely a “symbolic” expression. Yet in the next breath, he showed his political finesse by calling embattled Gerakan president Koh Tsu Koon “bodoh” or "stupid" for rebuking him over the threat.

"Malaysiakini/Malaysian Insider are cyber news portals. No threat to burn reporters or building. The remarks were only symbolic of the anger towards them for burning the hearts of the Muslim community),” Ezam said on his Twitter site.

The former PKR Youth leader who defected for a red carpet welcome by former UMNO president Abdullah Badawi has also managed to get into the good books of current Prime Minister Najib Razak.

Not only has Ezam inveigled a Senatorship, he has been put in charge of some UMNO-linked NGOs, the most recently established was the Gerakan Cegah Murtad (or Movement against Proselytization). At one time, there was even talk that Ezam might be put in charge of Selangor UMNO which has been spilt by the feuding between former chief Khir Toyo and current state No. 2, Noh Omar.

However, after his latest comments which shocked the nation due to its balatant criminal content, it is likely that Ezam might be placed in quarantine for a while before he wreaks further damage to the BN's image.

“We have no choice but to wage war to protect the Muslim faith. We give you a last warning. If you don’t stop, we’ll burn,” Ezam had said after Friday prayers at a Shah Alam mosque. He also warned Muslim staff of Malaysiakini and Malaysian Insider not to become agents for infidels.

Not satisfied, he then extended his warning to Selangor’s Christian exco members- Teresa Kok, Elizabeth Wong, Ronnie Liu and Xavier Jayakumar. “We have a problem if the Menteri Besar pawns Islam for votes. We have problems with infidels who convert Muslims,” he said.

Ezam was trying to galvanize the Malays into supporting JAIS or the Selangor Islamic Religious Department in a row over the raid on the Damansara Utama Methodist Church.

Bodoh, you

PKR vice president N Surendran has slammed him for the threat and called on police to take action against him.

Tsu Koon, also a BN member of Senate, said Ezam had not only tarnished his own image as "a senator but also that of the organisations he represents".

"If he thinks that reports in the online news portals were not correct and proper, he should present cogent arguments against them, present relevant facts and solid evidence, or even take legal action," said Koh.

"Unfortunately, instead of using his intellect and influence to argue and counter whatever he did not agree with, he allowed himself to be overtaken by emotions and sentiments which have evoked negative reaction of others."

But despite the rebuke from Tsu Koon, a senior BN leader and former Penang chief minister of nearly 2 deacdes, Ezam was unrepenting. To him, the Gerakan president was merely “stupid”.

“Don't follow PKR's tune in stupidly comparing the burning of Mkini/MInsider with the London riots. The end result of Muslims' sensitivities being burned are grave to communal harmony. Act before it's too late,” said Ezam.

Gold at record $1,800 as French fears sink stocks

Reuters

Gold climbed to a third record in a row on Wednesday, extending its best rally since 2008 as a dive in French bank stocks sent new shudders through anxious financial markets, sending U.S. stocks skidding.

Bullion rose as much as 3 percent, setting a new high over $1,800 an ounce, as the locus of traders’ euro zone debt fears shifted from Spain and Italy to France, where President Nicolas Sarkozy called for new fiscal restraint as markets fretted over the possibility that it may be next for a debt downgrade.

The latest jitters appeared to overshadow the Federal Reserve’s unprecedented decision to promise near-zero interest rates for the next two years, a double-edged sword for gold, which had been pulled back by Tuesday’s late Wall Street rally but would also benefit from a prolonged low-yield environment.

Spot gold rose near 3 percent to hit a high of $1,796.86 an ounce; it was up 2.3 percent at $1,784 by 12:00 p.m. EDT (1600 GMT). It also hit record highs in euro and sterling terms. U.S. COMEX gold futures for August delivery briefly topped $1,800 before pulling back.

It has rallied nearly 7 percent this week, and 20 percent since June, after a downgrade to the U.S. credit rating on Friday battered assets seen as higher risk, helped by simmering worries over euro zone debt and an increasingly grim-looking U.S. economic outlook.

France joined that list of woes on Wednesday as shares in its banks — among the most exposed to Italian and other peripheral euro zone government debt — slumped as much as 20 percent in afternoon trade as fears about the currency bloc’s debt crisis moved back to the forefront.

With governments and central banks running out of tools to combat the financial and economic distress, some analysts are now looking for gold to keep running toward $2,500, which would just top the inflation-adjusted peak of three decades ago.

“The skies would appear to be clear for these safe havens like gold,” said Andrew Wilkinson, senior market analyst at Interactive Brokers Group, Greenwich, Conn. With the debt woes spilling over into the world’s biggest economics, “we don’t know where this thing is going to stop anymore.”

Gold’s latest winning streak has broken it clear of the ascending trend channel that has contained it since late 2008 — coincidentally the last time it staged an 8 percent gain over the span of four days.

But the Relative Strength Index was flashing overbought status at 84, far above the 70 percent mark that often signals a correction may be in store. Gold has pulled back both times the index topped topped in the past 12 months.

“When you have a metal that has three or four distinct reasons why it has headed higher, it is very difficult not to be bullish in that environment,” said Mitsui Precious Metals analyst David Jolliet. But he added: “Given how far and how quickly we’ve run up, the move seems somewhat overextended.”

The Fed on Tuesday promised to keep interest rates near zero for at least two more years and said it would consider further steps to help growth.

The comments support the view that the opportunity cost of holding nonyielding gold would remain depressed. They also trigged what has proved to be a fleeting rally in stocks, one that briefly triggered a flurry of profit-taking in gold.

Global holdings of gold-backed exchange-traded funds, calculated by Reuters, fell 7.2 tonnes on Tuesday in their first daily decline in thirteen sessions.

The world’s biggest gold-backed ETF, New York’s SPDR Gold Trust, reported its biggest one-day outflow since Jan. 25 on Tuesday, of just over 13 tonnes. A day before it had seen its largest daily inflow since May last year.