Dictator Old Fart LKY signed his surrender on eve of birthday

[mediumcoke]

Sept.16 Magic

http://news.yahoo.com/s/nm/20080915/ts_nm/zimbabwe_crisis_dc;_ylt=AtAmv7X0RiwDNlmfBrfoBiKs0NUE

Zimbabwe rivals sign power-sharing deal

By MacDonald Dzirutwe 1 hour, 30 minutes ago

HARARE (Reuters) - Zimbabwe's President Robert Mugabe signed a power-sharing agreement with opposition rival Morgan Tsvangirai on Monday, relinquishing some of his powers for the first time in nearly three decades of iron rule.
ADVERTISEMENT

The deal followed weeks of tense negotiations to end a deep political crisis compounded by the veteran leader's disputed and unopposed re-election in a widely condemned vote in June. Under the agreement, Tsvangirai will become prime minister.

"This agreement sees the return of hope to all our lives. It is this hope that provides the foundation of this agreement that we sign today, that will provide us with the belief that we can achieve a new Zimbabwe," Tsvangirai said after the signing ceremony.

Zimbabweans hope the agreement will be a first step in helping to rescue the once prosperous nation from economic collapse. Inflation has rocketed to over 11 million percent and millions have fled to neighboring southern African countries.

Cheers greeted the signing of the deal at a Harare hotel by Mugabe, Movement for Democratic Change (MDC) leader Tsvangirai and Arthur Mutambara, who leads a breakaway faction of the MDC, the main opposition party.

But the ceremony was marred by supporters of the MDC and ruling ZANU-PF taunting each other and throwing rocks at opponents outside the venue where the signing took place.

Part of the fence around the hotel was trampled flat and police brought in two water cannons and a truckload of riot police. Police did not take any action.

The three smiling Zimbabwean leaders exchanged copies of the agreement and shook hands in front of South African President Thabo Mbeki, who brokered the deal, and other African leaders.

Mugabe, 84, made clear he would not tone down his attacks on Western countries such as former colonial power Britain. He accuses them of backing the opposition to drive him from power.

"African problems must be solved by Africans ... The problem we have had is a problem that has been created by former colonial powers," Mugabe said after the signing ceremony, as Tsvangirai looked uncomfortable.

But Mugabe added: "We are committed to the deal. We will do our best."

WESTERN COUNTRIES WATCHFUL

Western countries are still keen to see how the deal works in practice, but the European Union said on Monday it stood ready to bring aid to Zimbabwe if the new government took measures to restore democracy and the rule of law.

British Foreign Secretary David Miliband welcomed the agreement but said its details would be studied carefully.

"The new government needs to start to rebuild the country. If it does so, Britain and the rest of the international community will be quick to support them," he said in a statement.

Under the deal agreed last week, Tsvangirai will become prime minister and chair a council of ministers supervising the cabinet. Mugabe, who has ruled since independence from Britain in 1980, will remain president and head the cabinet.

The deal is expected to split control of the powerful security forces that have been key backers of Mugabe.

The president, a former guerrilla commander, is likely to keep command of Zimbabwe's strong army, but the MDC wants to run the police force. Mugabe's ZANU-PF will have 15 cabinet seats, Tsvangirai's MDC 13 and Mutambara's splinter MDC faction three seats.

Analysts say the power-sharing deal is fragile and will require former enemies to put aside their differences and work closely to overcome skepticism, especially from Western powers whose financial support will be vital for recovery.

To gain the confidence of Zimbabweans, the new leadership must present a formula for knocking down prices and easing severe food, fuel and foreign currency shortages.

"While it might be too early to predict the first policy steps of the new government, we think tackling inflationary pressures by reducing the money supply should be one of the top priorities in addressing the country's worsening structural economic imbalances," said Samir Gadio of investment bank Renaissance Capital.

"We expect changes at the Reserve Bank of Zimbabwe which was the chief architect of hyper-inflation through its persistent money printing."

ZANU-PF and MDC negotiators met early on Monday to allocate the 31 ministries. Names of the ministers are likely to be announced later in the week, a government official said.

There would also be a national security council, replacing a joint operations command of security service chiefs. The opposition says the security forces were instrumental in organizing a campaign that intimidated the opposition into standing down for the presidential run-off, allowing Mugabe to retain power.

(Additional reporting by Nelson Banya in Harare; Ingrid Melander in Brussels; Adrian Croft in London; Writing by Marius Bosch)

(For full Reuters Africa coverage and to have your say on the top issues, visit: http://africa.reuters.com/)

 

[mediumcoke]

Sept.16 Magic again Golden Period's Next Phase Arrived.



Stocks stumble amid new Wall Street landscape

By TIM PARADIS, AP Business Writer 9 minutes ago

NEW YORK - Stocks tumbled and Treasury bond prices soared Monday as investors reacted to a stunning reshaping of the landscape of Wall Street that took out two storied names: Lehman Brothers Holdings Inc. and Merrill Lynch & Co. The Dow Jones industrial average fell 300 points, though the market's initial losses were not as steep as some investors had feared.
ADVERTISEMENT

Stocks posted big losses in markets across much of the globe as investors absorbed bankruptcy plans at Lehman and Merrill Lynch's forced sale to Bank of America for $50 billion in stock. And perhaps most ominously, American International Group Inc. is asking the Federal Reserve for emergency funding. The world's largest insurance company plans to announce a major restructuring Monday.

The swift developments are the biggest yet in the 14-month-old credit crises that stems from now toxic subprime mortgage debt.

Investors are worried that trouble at AIG and the bankruptcy filing by Lehman, felled by $60 billion in bad debt and a dearth of investor confidence, will touch off another series of troubles for banks and financial institutions that may be forced to further write down the value of their own debt assets. Wall Street had been hopeful six months ago that the collapse of Bear Stearns would mark the darkest day of the credit crisis.

But AIG's troubles a week after its stock dropped 45 percent are worrisome for some investors because of the company's enormous balance sheet and the risks that troubles with that companies finances could spill over to the companies with which it does business. AIG, one of the 30 stocks that make up the Dow industrials, fell $5.04, or 42 percent, to $7.10 Monday as investors worried that it would be the subject of downgrades from credit ratings agencies.

"I think people were hoping that there was going to be a savior over the weekend and that hasn't happened," said Scott Fullman, director of derivatives investment strategy for WJB Capital Group in New York. "This is sort of groundbreaking type stuff."

In midmorning trading, the Dow fell 301.66, or 2.64 percent, to 11,120.33.

Broader stock indicators also fell. The Standard & Poor's 500 index fell 31.54, or 2.52 percent, to 1,220.77, and the Nasdaq composite index fell 40.50, or 1.79 percent, to 2,220.77.

A sharp drop in oil below $100 also weighed on energy names, including several Dow components. Exxon Mobil Corp. fell $1.36, or 1.8 percent, to $76.14, while Chevron Corp. fell $2.30, or 2.7 percent, to $81.94.

Light, sweet crude dropped $4.53 to $96.65 on the New York Mercantile Exchange after damage to Gulf of Mexico oil infrastructure from Hurricane Ike was less than investors feared. Worries about a slower economy have also weighed on oil prices in recent weeks. Oil is down sharply from its mid-July highs when it hit a record over $147 a barrel.

Despite the pullback in oil, prices at the gas pump rose above $5 per gallon in some parts of the country Sunday after Ike left some the nation's refining capacity inoperable.

Investors will be watching to see whether the Dow moves below the 11,000 mark, a level it hasn't traded and closed under since mid-July. The S&P 500 last tested the 1,200 level in mid-July.

Bond prices surged as investors fled to the security of government debt. The yield on the benchmark 10-year Treasury note, which moves opposite its price, plunged to 3.54 percent from 3.72 percent late Friday. The dollar was lower against other major currencies, while gold prices rose.

Investors did have some more solid footing than they might have predicted at the end of last week, when Lehman's troubles and those of AIG weighed on the markets. A global consortium of banks, working alongside government officials in New York, announced a $70 billion pool of funds to lend to troubled financial companies.

And the deal for Merrill Lynch pays a 70 percent premium to the brokerage's closing price Friday. The stock has been squeezed in recent weeks, leading many Wall Street veterans to point to the company as the next behind Lehman as likely to run into trouble with bearish investors and get hit by intensified selling. The deal to pair the company with Bank of America, a huge bank with a big asset base, removes some of the worries about Merrill would be the next to fall.

Merrill rose $4.76, or 28 percent, to $21.81, while Bank of America fell $4.58, or 14 percent, to $29.16.

Many market observers have said for months that a cathartic sell-off is necessary for Wall Street to purge its worries over bad debt and the tight credit conditions that have hobbled the economy. They reason that a scare and subsequent sell-off in the markets could establish conditions for a market bottom to form.

Fullman, who has worked on Wall Street for 29 years, compared the uncertainty over the market's reaction to the days after the Sept. 11, 2001, terror attacks.

"The fact was that nobody knew how bad things would get in the marketplace," he said.

Still, he noted that the Dow industrials contain companies, such as retailers like Wal-Mart Stores Inc. that could help cushion some of the selling in the financial sector.

"While they might get hit hard they won't get hit as hard," he said.

But even good news like a drop in oil and some resolution to fears about Merrill couldn't prevent widespread selling. Markets in Tokyo and several other Asian money centers were closed for holidays. But in afternoon trading in Europe, Britain's FTSE 100 fell 4.23 percent, Germany's DAX index fell 3.69 percent, and France's CAC-40 fell 4.84 percent. The European Central Bank, the Bank of England, and the Swiss central bank stepped in an attempt to calm markets by making more short-term credit available to banks.

The reduced headcount of Wall Street firms Monday left Goldman Sachs Group Inc. and Morgan Stanley as the remaining big, independent firms. The two are slated to report quarterly results Tuesday and Wednesday, respectively.

The shake up comes only a week after the government bailed out mortgage lenders Fannie Mae and Freddie Mac and ahead of sizable economic developments this week. The Fed is expected to make a decision on interest rates on Tuesday.

Declining issues outnumbered advancers by about 8 to 1 on the New York Stock Exchange, where volume came to 283.9 million shares.

The Russell 2000 index of smaller companies fell 13.16, or 1.83 percent, to 707.10.

___

On the Net:

New York Stock Exchange: http://www.nyse.com

Nasdaq Stock Market: http://www.nasdaq.com