Army warns unrest pushing Egypt to the brink


CAIRO, Egypt (Reuters) - Egypt's army chief said political unrest was pushing the state to the brink of collapse - a stark warning from the institution that ran the country until last year as Cairo's first freely elected leader struggles to curb bloody street violence.


Abdel Fattah al-Sisi, a U.S.-trained general appointed by President Mohamed Mursi last year to head the armed forces, added in a statement on Tuesday that one of the primary goals of deploying troops in cities on the Suez Canal was to protect the waterway that is vital for Egypt's economy and world trade.


Sisi's comments, published on an official army Facebook page, followed 52 deaths in the past week of disorder and highlighted the mounting sense of crisis facing Egypt and its Islamist head of state who is striving to fix a teetering economy and needs to prepare Egypt for a parliamentary election in a few months that is meant to cement the new democracy.


Violence largely subsided on Tuesday, although some youths again hurled rocks at police lines in Cairo near Tahrir Square.


It seemed unlikely that Sisi was signaling the army wants to take back the power it held for six decades since the end of the colonial era and through an interim period after the overthrow of former air force chief Hosni Mubarak two years ago.


But it did send a powerful message that Egypt's biggest institution, with a huge economic as well as security role and a recipient of massive direct U.S. subsidies, is worried about the fate of the nation, after five days of turmoil in major cities.


"The continuation of the struggle of the different political forces ... over the management of state affairs could lead to the collapse of the state," said General Sisi, who is also defense minister in the government Mursi appointed.


He said the economic, political and social challenges facing the country represented "a real threat to the security of Egypt and the cohesiveness of the Egyptian state" and the army would remain "the solid and cohesive block" on which the state rests.


Sisi was picked by Mursi after the army handed over power to the new president in June once Mursi had sacked Field Marshal Hussein Tantawi, in charge of Egypt during the transition and who had also been Mubarak's defense minister for 20 years.


The instability has provoked unease in Western capitals, where officials worry about the direction of a powerful regional player that has a peace deal with Israel. The United States condemned the bloodshed and called on Egyptian leaders to make clear violence was not acceptable.


DEEPLY POLARISED


The 58-year-old previously headed military intelligence and studied at the U.S. Army War College. Diplomats say he is well known to the United States, which donates $1.3 billion in military aid each year, helping reassure Washington that the last year's changes in the top brass would not upset ties.


One of Sisi's closest and longest serving associates, General Mohamed el-Assar, an assistant defense minister, is now in charge of the military's relations with the United States.


Almost seven months after Mursi took office, Egyptian politics have become even more deeply polarized.


Opponents spurned a call by Mursi for talks on Monday to try to end the violence. Instead, protesters have rallied in Cairo and Alexandria, and in the three Suez Canal cities - Port Said, Ismailia and Suez - where Mursi imposed emergency rule.


On Tuesday, thousands were again on the streets of Port Said to mourn the deaths of two people in the latest clashes there, taking the total toll in Mediterranean port alone to 42 people. Most were killed by gunshots in a city where weapons are rife.


Mohamed Ezz, a Port Said resident speaking by telephone, heard heavy gunfire through the night. "Gunshots damaged the balcony of my flat, so I went to stay with my brother," he said.


Residents in the three canal cities had taken to the streets in protest at a nightly curfew now in place there. The president's spokesman said on Tuesday that the 30-day state of emergency could be shortened, depending on circumstances.


In Cairo on Tuesday afternoon, police again fired teargas at stone-throwing youths in a street near Tahrir Square, the center of the 2011 uprising. But the clashes were less intense than previous days and traffic was able to cross the area. Street cleaners swept up the remains of burnt tires and other debris.


The police have been facing "unprecedented attacks accompanied by the appearance of groups that pursue violence and whose members possess different types of weapons", the state news agency reported, quoting the Interior Ministry spokesman.


Street flare-ups are a common occurrence in divided Egypt, frustrating many people desperate for order and economic growth.


WARY MILITARY


Although the general's comments were notably blunt, Egypt's military has voiced similar concerns in the past, pledging to protect the nation. But it has refused to be drawn back into a direct political role after its reputation as a neutral party took a pounding during the 17 months after Mubarak fell.


"Egyptians are really alarmed by what is going on," said Cairo-based analyst Elijah Zarwan, adding that the army was reflecting that broader concern among the wider public.


"But I don't think it should be taken as a sign that the military is on the verge of stepping in and taking back the reins of government," he said.


In December, Sisi offered to host a national dialogue when Mursi and the rivals were again at loggerheads and the streets were aflame. But the invitation was swiftly withdrawn before the meeting went ahead, apparently because the army was wary of becoming embroiled again in Egypt's polarized politics.


Protests initially flared during the second anniversary of the uprising which erupted on January 25, 2011 and toppled Mubarak 18 days later. They were exacerbated in Port Said when residents were angered after a court sentenced to death several people from the city over deadly soccer violence.


Since the 2011 revolt, Islamists who Mubarak spent his 30-year rule suppressing have won two referendums, two parliamentary elections and a presidential vote.


But that legitimacy has been challenged by an opposition that accuses Mursi of imposing a new form of authoritarianism. Mursi's supporters says protesters want to overthrow Egypt's first democratically elected leader by undemocratic means.


The army has already been deployed in Port Said and Suez and the government agreed a measure to let soldiers arrest civilians as part of the state of emergency. Sisi reiterated that the army's role would be to support the police in restoring order.


Mursi's invitation to rivals to a national dialogue with Islamists on Monday was spurned by the main opposition National Salvation Front coalition, which described it as "cosmetic".


The presidency said a committee would be formed to look at changes to the constitution, but it ruled out changing the government before the parliamentary election.


Mursi's pushing through last month of a new constitution which critics see as too Islamic remains a bone of contention.


(Additional reporting by Yasmine Saleh and Omar Fahmy in Cairo, Yusri Mohamed in Ismailia and Abdelrahman Youssef in Alexandria; Writing by Edmund Blair; Editing by Alastair Macdonald and Peter Millership)



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Dow, S&P 500 near flat after rally; Apple boosts Nasdaq

NEW YORK (Reuters) - The Dow and S&P 500 were nearly flat on Monday as a four-week rally stalled, while a rebound in Apple shares helped buoy the Nasdaq.


Caterpillar shares helped cap losses in the Dow industrials even as the company posted a 55 percent drop in quarterly profit due to a charge connected with accounting fraud at a Chinese subsidiary and weak demand among its dealers. Caterpillar's shares, down 2.2 percent in the past three sessions, rose 1.5 percent Monday to $96.97.


Boeing , down 1.2 percent at $74.14, shares led decliners on the Dow. The aircraft maker risks losing about $5 billion in revenue by the grounding of its 787 Dreamliner fleet, according to a Bloomberg report.


The S&P 500 is coming off a streak of eight sessions of gains, the longest in eight years, but the index remained above 1,500. It ended above that level on Friday for the first time in more than five years.


"I think this multi-year high is really something that's in play both for short-term traders and for folks with money on the sidelines," said Bucky Hellwig, senior vice president at BB&T Wealth Management in Birmingham, Alabama.


Investors poured $55 billion in new cash into stock mutual funds and exchange-traded funds in January, the biggest monthly inflow on record, research provider TrimTabs Investment Research said.


Bargain hunters lifted Apple after the tech giant's stock dropped 14.4 percent in the previous two sessions. With Apple's stock up 2.4 percent at $450.29, the iPad and iPhone maker regained the title as the largest U.S. company by market capitalization as Exxon Mobil fell 0.9 percent to $90.94 and slipped back to second place.


The Dow Jones industrial average <.dji> was up 10.70 points, or 0.08 percent, at 13,906.68. The Standard & Poor's 500 Index <.spx> was down 0.50 points, or 0.03 percent, at 1,502.46. The Nasdaq Composite Index <.ixic> was up 9.37 points, or 0.30 percent, at 3,159.08.


Data on Monday pointed to growing economic momentum as companies sensed improved consumer demand.


Thomson Reuters data showed that of the 150 companies in the S&P 500 that have reported earnings so far, 67.3 percent have beaten analysts' expectations, which is a higher proportion than over the past four quarters and above the average since 1994.


U.S. durable goods orders jumped 4.6 percent in December, a pace that far outstripped expectations for a rise of 1.8 percent. Pending home sales unexpectedly dropped 4.3 percent. Analysts were looking for an increase of 0.3 percent.


Equities have also gained support from a recent agreement in Washington to extend the government's borrowing power. On Monday, Fitch Ratings said that agreement removed the near-term risk to the country's 'AAA' rating.


Hess Corp shares shot up 6.3 percent to $62.59 after the company said it would exit its refining business, freeing up to $1 billion of capital. Separately, hedge fund Elliott Associates is looking for approval to buy about $800 million more in Hess stock.


(Additional reporting by Rodrigo Campos; Editing by Jan Paschal and Nick Zieminski)



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Who are these guys at QB in Super Bowl?


NEW ORLEANS (AP) — Tom Brady is not playing in the Super Bowl. Neither is Ben Roethlisberger or either of the Mannings.


This Super Bowl has a pair of fresh faces in Colin Kaepernick and Joe Flacco, one of whom will leave New Orleans as the latest and greatest at football's glamour position.


For each, this is new territory.


Flacco, the only quarterback to win a playoff game in each of his first five NFL seasons, will lead the AFC champion Baltimore Ravens into Sunday's matchup with second-year QB Kaepernick and the NFC winners, the San Francisco 49ers. Not exactly a superstar matchup — yet.


It's the first time in a decade that neither Brady, Roethlisberger, Eli Manning or Peyton Manning has gotten to the Super Bowl.


___


Online: http://pro32.ap.org/poll and http://twitter.com/AP_NFL


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‘Charities’ Funnel Millions to Climate-Change Denial






A British newspaper claims to have discovered the convoluted way oil billionaires in the United States can funnel huge amounts of cash toward climate change-denial campaigns, while reaping tremendous tax advantages in the process.


A shadowy group called the Donors Trust is largely funded by billionaire Charles Koch and his wife Liz, according to an investigation by The Independent. The trust indirectly receives millions of dollars in funding from a third-party group called the Knowledge and Progress Fund, which the Koch family operates, the paper claims.






Charles Koch and his brother David are majority shareholders in Koch Industries, an immense conglomeration of oil and gas companies with a global reach — and a definite interest in denying any link between fossil-fuel use and climate change.


A recent profile in Forbes called Charles Koch “one of the 50 most powerful people in the world, one of the 20 wealthiest — and one of the dozen most vilified.”


The IRS recognizes the Donors Trust as a charitable organization due to its status as a “donor-advised trust.” These trusts “are individual accounts administered by tax-exempt organizations, such as community foundations and national charities,” according to the Wall Street Journal.


Because the IRS considers these organizations charitable groups, money donated to them is tax-deductible, and the popularity of such trusts is growing quickly. Contributions to donor-advised trust funds increased 10.6 percent in 2011 over 2010, the Journal reports. [The Reality of Climate Change: 10 Myths Busted]


“It’s becoming the vehicle of choice,” said Robert Brulle, a sociologist at Drexel University in Philadelphia, referring to the donor-advised trust. “It’s an attractive conduit of funding to these conservative think tanks,” Brulle told LiveScience.


But what do the recipients of the estimated $ 500 million in donor funding since 2003 actually do with the money? “A lot of it is just unknown,” said Brulle. “It goes into the black box of Donors Trust” where the money is, for the most part, untraceable.


The website for Donors Trust provides some clues to their interests: “The current environment on university campuses values Diversitas over Veritas — but cultural diversity is a poor substitute for truth, which must be the prevailing aim of the university. And discovering truth is impossible without a commitment to freedom of inquiry and the broadest possible range of viewpoints — what we call intellectual pluralism.


“Typically, we provide top-notch professors with substantial seed capital, spread over three years. After these professors have demonstrated progress with their ‘centers,’ we assist them in identifying other funding sources — alumni, institutional or foundations — to sustain their efforts.”


According to the Independent’s investigation, Donors Trust has given significant funding to the Competitive Enterprise Institute, a right-wing think tank. Climatologist Michael Mann of Pennsylvania State University has sued that group, claiming it accused him of scientific fraud and compared him to a child molester. (Nine investigations of Mann’s climate research, including one by the U.S. Environmental Protection Agency and another by the National Science Foundation, have found no evidence of academic fraud. The CEI removed the harsh claims several days after publication.)


Mann, however, remains committed to promoting a science-based approach to climate change. “I like to think we’re turning the corner on this issue. The damaging impacts that climate change is already having on us here in the U.S. … are increasingly clear to the person on the street,” Mann told LiveScience in an email interview.


“Climate-change denial, despite the great degree of funding and organization behind it, is simply no longer credible to the vast majority of the public,” Mann said. “It is my hope — and my expectation — that we will soon transition from the unworthy debate about whether the problem even exists to the worthy debate to be had about what to do about it.”


Follow LiveScience on Twitter @livescience. We’re also on Facebook & Google+.


Copyright 2013 LiveScience, a TechMediaNetwork company. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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Why haven't we learned from fires?






STORY HIGHLIGHTS


  • Pyrotechnics, overcrowding, poor exits have contributed to tragic fires in recent years

  • You would think the world would have learned from past incidents, John Barylick says

  • Concertgoers have to be their own fire marshals, he says




Editor's note: John Barylick, author of "Killer Show," a book on the 2003 Station nightclub fire in Rhode Island, is an attorney who represented victims in wrongful death and personal injury cases arising from the fire.


(CNN) -- Sunday morning we awoke to breaking news of another tragic nightclub fire, this time in Brazil. At last report the death toll exceeded 230.


This tragedy is not without precedent. Next month will mark the 10th anniversary of a similar nightclub fire in Rhode Island. At this sad time, it's appropriate to reflect on what we've learned from club fires -- and what we haven't.


Rhode Island's Station nightclub fire of 2003, in which 100 concertgoers lost their lives, began when fireworks set off by Great White, an 80s heavy metal band, ignited flammable packing foam on the club's walls.


Deadly blazes: Nightclub tragedies in recent history



John Barylick

John Barylick





Panicked patrons stampeded toward the club's main exit, and a fatal pileup ensued. Contributing to the tragedy were illegal use of pyrotechnics, overcrowding and a wall covering that would have failed even the most rudimentary flammability tests.


Video images of the Station fire were broadcast worldwide: A concert begins; the crowd's mood changes from merry, to curious, to concerned, to horrified -- in less than a minute. You'd think the world would have learned from it. You would be wrong.



The following year, the Republica Cromanon nightclub in Argentina went up in flames, killing 194 people. The club was made to hold about 1,000 people, but it was estimated that more than 3,000 fans were packed inside the night of the fire, which began when fans began lighting flares that caught the roof on fire.


Echoes of the past: Rhode Island victims 'can't help but watch'


Then, in January 2009, at least 64 New Year's revelers lost their lives in a nightclub in Bangkok, Thailand, after fire ignited its ceiling. Many were crushed in a rush to get out of the club. In December of that same year, a fire in a Russian nightclub, ignited by pyrotechnics, killed 156 people. Overcrowding, poor exits, and indoor fireworks all played roles in these tragedies; yet no one bothered to learn from mistakes of the past.


While responsibility for concert disasters unquestionably lies with venue operators, performers and promoters, ultimately, we, as patrons of clubs and concerts, can enhance our own safety by taking a few simple steps. The National Fire Protection Association urges concertgoers to:


• Be observant. Is the concert venue rundown or well-maintained? Does the staff look well-trained?


• As you proceed to your seat, observe how long the process takes. Could you reverse it in a hurry? Do you pass through pinch points? Is furniture in the way?


• Once seated, take note of the nearest exit. (In an emergency, most people try to exit by the door they entered, which is usually not the closest, and is always overcrowded.) Then, share the location of that nearest exit with your entire party. Agree that at the first sign of trouble, you will all proceed to it without delay.


• Once the show begins, remain vigilant. If you think there's a problem, LEAVE IMMEDIATELY. Do not stay to "get your money's worth" despite concerns about safety. Do not remain to locate that jacket or bag you placed somewhere. No concert is worth your life. Better to read about an incident the next day than be counted as one of its statistics.


Read more: How to protect yourself in a crowd


To be sure, all fire codes must be vigorously enforced, and club and concert hall operators must be held to the highest standards. A first step is banning indoor pyrotechnics in all but the largest, stadium-type venues.


But, ultimately, we are our own best "fire marshals" when it comes to avoiding, and escaping, dangerous situations. We can still enjoy shows. But it is up to us to look out for our own safety.


In coming days, Rhode Islanders will follow the unfolding news from Brazil with a sense of queasy deja vu -- the rising body counts, the victim identification process, the grieving families, and the assigning (and dodging) of blame. If only they had learned from our tragedy.


The opinions expressed in this commentary are solely those of John Barylick.







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Boy Scouts may end ban on gay scouts, leaders









DALLAS—





 Boy Scouts of America is discussing ending a longstanding ban on gay members and whether to allow local organizations to decide their own policy, a spokesman said on Monday.

Lifting the ban would mark a dramatic reversal for the 103-year-old organization, which only last summer reaffirmed its policy amid heavy criticism from gay rights groups and some parents of scouts.

"The BSA is discussing potentially removing the national membership restriction regarding sexual orientation," spokesman Deron Smith said in an email to Reuters.

"The policy change under discussion would allow the religious, civic or educational organizations that oversee and deliver Scouting to determine how to address this issue," the spokesman said.

The organization, which had more than 2.6 million youth members and more than 1 million adult members at the end of 2012, "would not, under any circumstances, dictate a position to units, members, or parents," Smith said.

The Boy Scouts won a 5-4 U.S. Supreme Court ruling allowing the organization to ban gays in 2000, but has come under increasing public pressure in recent years from activists including Zach Wahls, an Eagle scout with two lesbian mothers, and Jennifer Tyrrell, a lesbian mother from Ohio who was ousted as a Scout den leader and treasurer.

"This is absolutely a step in the right direction," Wahls said on Monday, adding that if the national board approves the change, he would turn to persuading local councils to enact nondiscrimination policies.

Wahls is the founder of Scouts for Equality, which collected more than 1.2 million signatures opposing the anti-gay policy. His group's membership includes 3,151 other Eagle scouts.

"I think the Boy Scouts is obviously a positive move, but they've been discussing this for a while," said Shane Windmeyer, executive director of Campus Pride, a national group supporting the rights of lesbian, gay, bisexual and transgender people.



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Violence flares in Egypt after emergency law imposed


CAIRO (Reuters) - A man was shot dead on Monday in a fifth day of violence that has killed 50 Egyptians and prompted the Islamist president to declare a state of emergency in an attempt to end a wave of unrest sweeping the biggest Arab nation.


Emergency rule announced by President Mohamed Mursi on Sunday covers the cities of Port Said, Ismailia and Suez. The army has already been deployed in two of those cities and ministers agreed a measure to let soldiers arrest civilians.


A cabinet source told Reuters any trials would be in civilian courts, but the step is likely to anger protesters who accuse Mursi of using high-handed tactics of the kind they fought against to oust his military predecessor Hosni Mubarak.


Egypt's politics have become deeply polarized since those heady days two years ago, when protesters were making the running in the Arab Spring revolutions that sent shockwaves through the region and Islamists and liberals lined up together.


Although Islamists have won parliamentary and presidential elections, the disparate opposition has since united against Mursi. Late last year he moved to expand his powers and pushed a constitution with a perceived Islamist bias through a referendum. The moves were punctuated by street violence.


Mursi's national dialogue meeting on Monday to help end the crisis was spurned by his main opponents.


They say Mursi hijacked the revolution, listens only to his Islamist allies and broke a promise to be a president for all Egyptians. Islamists say their rivals want to overthrow by undemocratic means Egypt's first freely elected leader.


Thousands of anti-Mursi protesters were out on the streets again in Cairo and elsewhere on Monday, the second anniversary of one of the bloodiest days in the revolution which erupted on January 25, 2011 and ended Mubarak's iron rule 18 days later.


"The people want to bring down the regime," they chanted Alexandria. "Leave means go, and don't say no!" they shouted.


VOLLEYS OF TEARGAS


Propelled to the presidency in a June election by the Muslim Brotherhood, Mursi has lurched through a series of political crises and violent demonstrations, complicating his task of shoring up the economy and of preparing for a parliamentary election to cement the new democracy in a few months.


Instability in Egypt has raised concerns in Western capitals, where officials worry about the direction of a key regional player that has a peace deal with Israel.


In Cairo on Monday, police fired volleys of teargas at stone-throwing protesters near Tahrir Square, cauldron of the anti-Mubarak uprising. A car was torched on a nearby bridge.


A 46-year-old bystander was killed by a gunshot early on Monday, a security source said. It was not clear who fired.


"We want to bring down the regime and end the state that is run by the Muslim Brotherhood," said Ibrahim Eissa, a 26-year-old cook, protecting his face from teargas wafting towards him.


The political unrest has been exacerbated by street violence linked to death penalties imposed on soccer supporters convicted of involvement in stadium rioting in Port Said a year ago.


As part of emergency measures, a daily curfew will be imposed on the three canal cities from 9 p.m. (1900 GMT) to 6 a.m. (0400 GMT). Residents have said they will defy it.


The president announced the measures on television on Sunday: "The protection of the nation is the responsibility of everyone. We will confront any threat to its security with force and firmness within the remit of the law," Mursi said, angering many of his opponents when he wagged his finger at the camera.


He offered condolences to families of victims. But his invitation to Islamist allies and their opponents to hold a national dialogue was spurned by the main opposition National Salvation Front coalition. Those who accepted were mostly Mursi's supporters or sympathizers.


SENDING A MESSAGE


The Front rejected the offer as "cosmetic and not substantive" and set conditions for any future meeting that have not been met in the past, such as forming a government of national unity. They also demanded that Mursi declare himself responsible for the bloodshed.


"We will send a message to the Egyptian people and the president of the republic about what we think are the essentials for dialogue. If he agrees to them, we are ready for dialogue," opposition politician Mohamed ElBaradei told a news conference.


The opposition Front has distanced itself from the latest flare-ups but said Mursi should have acted far sooner to impose security measures that would have ended the violence.


"Of course we feel the president is missing the real problem on the ground, which is his own policies," Front spokesman Khaled Dawoud said after Mursi made his declaration.


Other activists said Mursi's measures to try to impose control on the turbulent streets could backfire.


"Martial law, state of emergency and army arrests of civilians are not a solution to the crisis," said Ahmed Maher of the April 6 movement that helped galvanize the 2011 uprising. "All this will do is further provoke the youth. The solution has to be a political one that addresses the roots of the problem."


Rights activists said Mursi's declaration was a backward step for Egypt, which was under emergency law for Mubarak's entire 30-year rule. His police used the sweeping arrest provisions to muzzle dissent and round up opponents, including members of the Brotherhood and even Mursi himself.


Heba Morayef of Human Rights Watch in Cairo said the police, still hated by many Egyptians for their heavy-handed tactics under Mubarak, would once again have the right to arrest people "purely because they look suspicious", undermining efforts to create a more efficient and respected police force.


"It is a classic knee-jerk reaction to think the emergency law will help bring security," she said. "It gives so much discretion to the Ministry of Interior that it ends up causing more abuse, which in turn causes more anger."


(Additional reporting by Yasmine Saleh in Cairo, Yusri Mohamed in Ismailia and Abdelrahman Youssef in Alexandria; Editing by Giles Elgood, Peter Millership and Alastair Macdonald)



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Fed waits for job market to perk up


LONDON (Reuters) - The Federal Reserve's ultra-loose monetary policy is a root cause of the "currency wars" that some see as a looming threat to the world economy, but don't expect the U.S. central bank to signal a shift back to normal any time soon.


The Fed, whose policy-setting Federal Open Market Committee concludes a two-day meeting on Wednesday, said just last month that it expects to keep short-term interest rates exceptionally low until the U.S. unemployment rate falls to 6.5 percent, inflation permitting.


That goal is still distant. Figures on Friday are likely to show that the jobless rate was unchanged in January at 7.8 percent, while the economy created 155,000 jobs, the same as in December, according to economists polled by Reuters.


So it would be a huge surprise if the Fed were to do anything other than reaffirm last month's decision to anchor short-term interest rates in a range of zero to 0.25 percent and to keep buying $85 billion of bonds each month to hold down long-term rates.


The only question mark is whether the FOMC vote will be unanimous now that Richmond Fed President Jeffrey Lacker, who opposes the current round of bond-buying, has rotated off the panel, said Harm Bandholz, an economist with UniCredit Bank in New York.


Most economists polled by Reuters expect the Fed to keep its open-ended bond-buying program in place well into next year, even though the economic news flow and market confidence are improving markedly.


True, Wednesday's preliminary report on fourth-quarter GDP is likely to show that growth slowed to an annualized rate of 1.2 percent from 3.1 percent in the July-September period.


And the current quarter will also be soft as the expiry of a 2 percent payroll tax cut is dampening consumer spending.


But then Bandholz expects an average growth rate of 2.8 percent over the rest of the year. That would be the strongest three-quarter period of the recovery so far, he said.


"The outlook has improved a lot in the U.S. I've been on the cautious side for the last three years, but this time I'm a bit more bullish," he said.


THE FED BIDES ITS TIME


The recovery in housing would add at least half a percentage point to GDP growth in 2013, while capital spending was likely to revive now that uncertainty over budget talks in Washington had been largely allayed, Bandholz said.


"There's a lot of pent-up demand in the system. I don't think all these investments have been abandoned; they've just been postponed," he said.


At some point, investors' exuberance over the super-easy stance of the world's major central banks will give way to worries that they are about to take away the punch bowl.


Gustavo Reis, an economist with Bank of America Merrill Lynch in New York, said concerns about the costs of money-printing were likely to spread but would be offset by uncertainty over the impact on growth of fiscal tightening in the United States and Europe.


"All told, although global activity seems more robust now than at any point in 2012, we expect policymakers to continue to worry predominantly about downside risks," he said in a note.


The bank does not expect the Fed to consider halting asset purchases before 2014, while the latest episode of monetary easing announced by the Bank of Japan is likely to be ‘long-lived and significant'.


Many economists argue that bold monetary action is long overdue in Japan, whose nominal output has not grown in 20 years, saddling the government with a debt-to-GDP ratio of more than 220 percent.


But Douglas McWilliams, who heads the Centre for Economics and Business Research, a London consultancy, fears Japan's decision will lead the global economy into unpredictable currency wars.


"It's a bit like if someone's rude to you, you're rude to them back. You get tit-for-tat behavior," McWilliams said.


CURRENCY FRICTION, BUT NO WAR


Olivier Blanchard, the chief economist of the International Monetary Fund, last week called talk of currency wars overblown and said countries had to pull the right policy levers to get their economies back on track, with corresponding consequences for exchange rates.


However, McWilliams said the problem was that it was difficult to get countries to agree NOT to wage currency wars.


Tellingly, Chancellor Angela Merkel voiced German concerns last week that Japan might be deliberately seeking to cheapen the yen to give its exporters a competitive edge.


"So we may well find that there is a period of very heavy volatility before the authorities involved try and get some kind of agreement," McWilliams said.


In a relatively quiet week for economic data in the euro zone - money supply figures and confidence surveys from the European Commission are the highlights - the focus is likely to remain squarely on the euro, which has been rising briskly as traders price in the policy shifts that Blanchard had in mind.


While the Fed and the Bank of Japan are expanding their balance sheets, the European Central Bank is starting to soak up some of the emergency cash it lent to banks a year ago.


The central bank said on Friday that banks would repay early 137 billion euros of cheap borrowed money.


"I'm not sure if we have too strong a euro for the moment but certainly we would not want to see a currency war of competitive devaluations which would have a negative effect on the euro," the European Union's top monetary official, Olli Rehn, told Reuters.


(Additional reporting by Paul Taylor in Davos; editing by Jason Neely)



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Djokovic completes Australian Open hat trick


MELBOURNE, Australia (AP) — No shirt ripping or bare-chested flexing this time.


Novak Djokovic completed his work before midnight, defeating Andy Murray in four sets for his third consecutive Australian Open title and fourth overall.


It was also the second time in three years Djokovic had beaten his longtime friend in this final. So the celebration was muted: a small victory shuffle, raised arms, a kiss for the trophy. No grand histrionics, although that's not to say the moment was lost on him.


"Winning it three in a row, it's incredible," Djokovic said after his 6-7 (2), 7-6 (3), 6-3, 6-2 victory Sunday night. "It's very thrilling. I'm full of joy right now. It's going to give me a lot of confidence for the rest of the season, that's for sure."


Nine other men had won consecutive Australian titles in the Open era, but none three straight years. One of them was Andre Agassi, who presented Djokovic with the trophy.


A year ago, Djokovic began his season with an epic 5-hour, 53-minute five-set win over Rafael Nadal at the Australian Open, the longest Grand Slam final. He tore off his shirt to celebrate, the TV replays repeated constantly at this tournament.


He mimicked that celebration after coming back to beat Stanislas Wawrinka in five hours in a surprisingly tough fourth-round victory this time.


Since then, he's looked every bit the No. 1 player. He said he played "perfectly" in his 89-minute win over fourth-seeded David Ferrer in the semifinals Thursday night. Murray struggled to beat 17-time major winner Roger Federer in five sets in the semifinals Friday night, and still had the bad blisters on his feet to show for it in the final.


In a final that had the makings of a classic when two of the best returners in tennis were unable to get a break of serve in the first two sets that lasted 2:13, the difference may have hinged on something as light as a feather.


Preparing for a second serve at 2-2 in the second set tiebreaker, Murray was rocking back about to toss the ball when he stopped, paused and then walked onto the court and tried to grab a small white feather that was floating in his view. He went back to the baseline, bounced the ball another eight times and served too long.


After being called for a double-fault, Murray knocked the ball away in anger and flung his arm down. He didn't get close for the rest of the tiebreaker and was the first to drop serve in the match — in the eighth game of the third set. Djokovic broke him twice in the fourth set, which by then had turned into an easy march to victory.


"It was strange," said Djokovic, adding that it swung the momentum his way. "It obviously did. ... He made a crucial double-fault."


Murray didn't blame his loss on the one distraction.


"I mean, I could have served. It just caught my eye before I served. I thought it was a good idea to move it," he said. "Maybe it wasn't because I obviously double-faulted.


"You know, at this level it can come down to just a few points here or there. My biggest chance was at the beginning of the second set — didn't quite get it. When Novak had his chance at the end of the third, he got his."


Djokovic had five break-point chances in the opening set, including four after having Murray at 0-40 in the seventh game, but wasn't able to convert any of them.


Then he surrendered the tiebreaker with six unforced errors. Murray appeared to be the stronger of the two at the time. He'd beaten Djokovic in their last Grand Slam encounter, the U.S. Open final, and had the Serb so off balance at times in the first set that he slipped to the court and took skin off his knee.


Murray held serve to open the second set and had three break points at 0-40 in the second game, but Djokovic dug himself out of trouble and held.


"After that I felt just mentally a little bit lighter and more confident on the court than I've done in the first hour or so," Djokovic said. "I was serving better against him today in the first two sets than I've done in any of the match in the last two years."


Djokovic said he loves playing at Rod Laver Arena, where he won his first major title in 2008. He now has six Grand Slam titles altogether. Federer has won four of his 17 majors at Melbourne Park, and Agassi is the only other player to have won that many in Australia since 1968.


Djokovic was just finding his way at the top level when Agassi retired in 2006, but he had watched enough of the eight-time major winner to appreciate his impact.


"He's I think one of the players that changed the game — not just the game itself, but also the way the people see it," Djokovic said. "So it was obviously a big pleasure and honor for me to receive the trophy from him."


Agassi was among the VIPs in the crowd, along with actor Kevin Spacey and Victoria Azarenka, who won the women's final in three sets against Li Na the previous night.


Murray broke the 76-year drought for British men at the majors when he won the U.S. Open last year and said he'll leave Melbourne slightly more upbeat than he has after defeats here in previous years.


"The last few months have been the best tennis of my life. I mean, I made Wimbledon final, won the Olympics, won the U.S. Open. You know, I was close here as well," he said. "No one's ever won a slam (immediately) after winning their first one. It's not the easiest thing to do. And I got extremely close.


"So, you know, I have to try and look at the positives of the last few months, and I think I'm going the right direction."


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Women in infantry: Tough challenge?




Hospital Corpsman Shannon Crowley packs for a mission as Lance Cpl.. Kristi Baker sits on her bed in 2010 in Afghanistan.




STORY HIGHLIGHTS


  • Maren Leed: Ban on women in combat has hurt operations, women's promotion

  • Leed: Integrating women into the physically demanding infantry presents challenges

  • Women are already in combat; she says, the "front line" and "rear line" no longer exist

  • Leed: Research into women in infantry might show that some limits might be appropriate




Editor's note: Maren Leed is senior adviser, Harold Brown Chair in defense policy studies at the Center for Strategic and International Studies. From 2011 to 2012, she served as senior adviser to the chief of staff of the U.S. Army. Follow the Center for Strategic and International Studies on Twitter.


(CNN) -- In the coming years, lifting the ban on women in combat, announced Thursday by Defense Secretary Leon Panetta, might prove particularly challenging in the most iconic of military occupations -- the infantry, among the most physically demanding and tradition-bound branches of the Marines and the Army.


Determining the best path forward to integrate women into this elite group will require hard-nosed honesty, careful management and compelling leadership.


For the 65 years that women have enjoyed a permanent place in the United States military, they have been subject to restrictions. One rationale is the notion embedded in our culture that women should be shielded from great physical risks. Another is a recognition of the physical superiority of the average male over the average female. A third is the fear that unit cohesion, critical to military performance, would suffer with the introduction of women.



Maren Leed

Maren Leed




These three concerns apply to varying degrees in the infantry. But the last 11 years of war have clearly demonstrated that warfare is no longer waged in a linear fashion, and that the concept of "front line" no longer applies.


Opinion: A more equal military? Bring back draft


Historically, logistics operations were conducted "in the rear," where risks were comparatively low. This has changed: In 2006 in Iraq, for example, one in every five truck convoys was attacked. Although infantry clearly remains one of the most dangerous military occupations, the proliferation of homemade bombs and other low-cost, lethal weaponry and tactics have heightened the risk of almost every occupation. War is more uniformly dangerous.


That said, physical differences between the sexes remains a thorny issue. Determining gender-neutral physical standards for an integrated infantry will be one of the most difficult tasks ahead.


Infantry soldiers and Marines are the primary forces for operations on foot. They not only travel long distances, but also frequently carry loads in excess of 50 pounds. Both the short- and long-term health effects of such demands can be significant.


Single mom fought alongside combat troops in Afghanistan






The Defense Department has consistently pursued solutions to lighten the load, from exoskeletons to unmanned vehicles that would serve as "pack mules," to the elusive quest for higher power, lower weight batteries.


The success of these efforts will benefit both men and women. But until that happens, research into the effects these physical demands have on women is necessary before determining the degree to which they can, and should, be part of the full range of infantry.


Whether men serving in the infantry will accept women as peers is another open question.


Those who oppose women in the infantry argue that they would change group dynamics, disrupt bonding and ultimately harm unit cohesion. In the past, these fears have been brought up regarding the participation of minorities and homosexuals, too. But data show these negative predictions don't come true. Instead, successful integration has happened with strong leadership, and, critically, a process that is broadly perceived to be fair.


Opinion: Women in combat a dangerous experiment


Even if the arguments underpinning the ban on women in combat have weakened, is there sufficient justification for change? The Joint Chiefs apparently believe so, as they have unanimously recommended the ban be lifted.


Each of the services already has been taking steps along these lines. This is in part driven by the evolution of the battlefield. When today's senior leaders were serving time in Iraq and Afghanistan, they realized that the restrictions on women sometimes also restricted their missions.


They implemented work-arounds and sought exceptions to policy. But they came home with firsthand experience of the mismatch between modern warfare and the policies limiting women's role. Women are in combat, and senior military leaders believe that future success demands they must remain available to be so, in even greater numbers.


From the institutional viewpoint, there are also concerns that the traditional limitations fail to make the best use of women in the service. Combat experience weighs heavily in promotion decisions, and restrictions have precluded women from gaining experiences equal to those of male counterparts.


Women are also excluded from many of the occupations disproportionately represented in senior leadership, and that automatically limits the number of women who can advance to the highest levels. At the same time, the pool of Americans eligible for military service is shrinking, and competition for high-quality recruits is intensifying. So it's imperative that the military fully leverage the talent of the men and women it has and that it seeks to attract.


By the numbers: Women in the U.S. military


The arguments in favor of lifting the ban on women in combat outweigh those against it. Despite Defense Secretary Leon Panetta's announcement on Thursday, the military services maintain the prerogative to preclude women from serving in certain positions or occupations.


Infantry, or at least some specialties within that branch, could well be a case in which restrictions are warranted. But military leaders have time to evaluate this proposition, and to set the conditions to make any change stick. The path ahead may not be smooth, but it is necessary.


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The opinions expressed in this commentary are solely those of Maren Leed.






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