UK - Dealing a sizeable blow to pro-independence campaigners, Mark Carney, Governor of the Bank of England, has said that “a currency union is incompatible with sovereignty”. Speaking at the TUC Congress in Liverpool, Mr Carney made clear that an independent Scotland would fail to meet the criteria of a successful currency union. A proper union would require free trade, banking union, and a fiscal backstop, he said. “You only need to look across the channel to see what happens if you don't have all of those components in place”, said Mr Carney. The Governor noted the Westminster view of Scottish independence would make creating the conditions for a formal currency union impossible. City analysts now predict that both Scotland and the rest of the UK could suffer financially if the 300-year-old Union ends.

UK - The City watchdog is making plans for Scottish independence, anticipating a flood of queries from firms worried about the consequences of a “yes” vote. John Griffith-Jones, the chairman of the Financial Conduct Authority, said the regulator is making contingency plans around ensuring it is equipped to deal with a surge in calls and able to give advice if Scotland votes to secede in next week’s referendum. Many details of what an independent Scotland would look like remain unanswered just over a week before the vote, leading to considerable uncertainty about the impact of a yes vote. However, he admitted that the thorny issue of financial regulation will become even more complex in the event of a “yes” vote.

USA - There are few truisms about the world economy, but for decades, one has been the role of the United States dollar as the world’s reserve currency. It’s a core principle of American economic policy. But new research reveals that what was once a privilege is now a burden, undermining job growth, pumping up budget and trade deficits and inflating financial bubbles. To get the American economy on track, the government needs to drop its commitment to maintaining the dollar’s reserve-currency status. It is widely recognized that various countries, including China, Singapore and South Korea, suppress the value of their currency relative to the dollar to boost their exports to the United States and reduce its exports to them. They buy lots of dollars, which increases the dollar’s value relative to their own currencies, thus making their exports to us cheaper and our exports to them more expensive.

EUROPE - Immigration backlash is on the rise in Europe. As prominent nations within the EU grow increasingly burdened with floods of immigrants from the Middle East and Eastern Europe, concern is growing among citizens that foreigners are diminishing local culture and costing jobs, and these fears are being reflected in political action. Anti-immigration groups like Austria’s Freedom Party and France’s National Front Party are seeing their largest support in decades.

GERMANY - With his visit to India, German Foreign Minister Frank-Walter Steinmeier is seeking to strengthen German relations with a potential rival of China. He arrived Saturday in New Delhi to intensify economic and political cooperation. In view of the persisting Euro crisis and the decline of business transactions with Russia, Germany is seeking to find alternative export opportunities for its companies. Berlin is also seeking close cooperation in the fields of foreign and military policy to support an integration of India into the Western alliance. India's new President Narenda Modi, who has been strongly criticized because of his party's anti-Muslim slander and his role in the 2002 pogroms, is currently intensifying cooperation in foreign and military policy with Japan and Australia, two central Western allies of the Pacific Basin. Australia is moving closer to NATO and Japan is intensifying the conflict with the People's Republic of China.

ISRAEL - Two years after Israel’s Masorti (Conservative) Movement approved the ordination of gay and lesbian rabbis, the nation’s first homosexual Masorti rabbi has taken his place at the pulpit. Rabbi Mikie Goldstein, a native of Liverpool, England, who has been living in Israel since 1989, was installed on Thursday evening as the leader of Adat Shalom Emanuel in Rehovot, the only non-Orthodox synagogue in the city. “My motto is to give Judaism back to the people,” says Goldstein, 49. “I feel that the Orthodox establishment in this country has hijacked Judaism and decided there is only one way to be Jewish… I realized that if someone is going to make a stand, it’s going to be me. So I got off my behind, and I went to study.”

USA - The US city of Phoenix, which has been experiencing a long drought, was hit by record rainfall for a single day leading to the deaths of two people. Floods turned freeways into rivers and rescue services had to pull drivers from their cars. A woman died after being swept away in her vehicle, and in a separate incident a 76-year-old woman drowned. The flooding came as Arizona was lashed by storms brought by the remnants of Hurricane Norbert in the Pacific. A total of 3.29 inches of rain was measured at Phoenix airport, easily surpassing the previous daily record of 2.91 inches set in 1939, the National Weather Service said. It was more rain than had fallen throughout the whole summer.

UK - Powerful investors across the world have woken up to the possibility that Scotland may vote to break up the United Kingdom, with some already preparing defensive action that risks a potentially dangerous flight from sterling and Britain’s bond market. Japan’s biggest bank, Nomura, has advised clients to slash financial exposure to the UK and brace for a possible collapse of the pound after polls showed the independence campaign running neck and neck, warning that the separation of England and Scotland after more than 300 years would be a “cataclysmic shock”. “The 'fast money’ funds started moving a week ago but now we are seeing 'real money’ clients acting,” said Jordan Rochester, the bank’s foreign exchange strategist. “The risks are suddenly seen as much greater for Japanese pension funds.”

USA - People have such short memories. Even though we are repeating so many of the same patterns that we witnessed in 2000-2001 and 2007-2008, most people do not think that another financial crash is coming. In fact, with the stock market setting record high after record high lately, I have been taking quite a bit of criticism for my relentless warnings about the coming financial storm. Of course these critics never offer any hard evidence that I have been wrong about anything. They just assume that since the stock market has soared to unprecedented heights that all of us "bears" must have been wrong.

UK - A sharp rise in the number of UK school leavers going on to university is failing to translate into higher levels of basic skills, according to a major international study. Figures from the Organisation for Economic Co-operation and Development (OECD) show the majority of students are completing higher education courses without good levels of literacy. In a report, it was revealed that just a quarter of UK graduates had top-level reading and writing skills compared with at least a third of those in some other developed nations such as Japan, Finland, the Netherlands, Sweden and Australia.

NICARAGUA - A meteorite that landed "like a bomb", narrowly missing Nicaragua's main airport, has raised concerns over scientists' ability to track space objects on potential collision courses with Earth. Officials said they "thanked God" there were no injuries as the rock landed in Managua, a sprawling city of 1.2 million people, where it left a crater 40ft wide and 16ft deep. The object was believed to have been a small part of the asteroid 2014 RC, nicknamed "Pitbull", which astronomers had been monitoring as it passed the planet. Nasa currently tracks more than 11,000 asteroids that come relatively close to Earth but 2014 RC, which is the size of a large house, was only discovered on August 31.

UK - David Cameron is under growing pressure to ask the Queen to speak out in support of the Union as another opinion poll confirms a surge in support for Scottish independence. Senior MPs have suggested an intervention from Her Majesty could “make all the difference” as a TNS poll shows the Yes and No campaigns running neck and neck. The pound crashed to a 10-month low on Monday and £2.3 billion was wiped off the value of the six FTSE-100 companies based in Scotland on the first day of trading since a weekend poll put the Yes campaign ahead for the first time. The Prime Minister has been warned by his own MPs that his job may depend on the outcome of the Scottish referendum on September 18. Ed Miliband, the Labour leader — who would lose more than 40 MPs if Scotland votes for independence — would also come under pressure to resign if Scots vote to separate.

ISRAEL - A former head of Mossad said he doesn’t envision any joint effort between US and Iran in dealing with the Islamic State group, despite their mutual interest in halting the jihadist group’s advances across Iraq and Syria. Israel, he said, must also be on the alert, not so much because of the IS forces battling the Syrian army for control of areas right along Israel’s border in the Golan, but rather due to supporters of the group within its borders. “There are indications of sympathy for IS among Israeli citizens,” he said. “When there is a background of sympathy, there are usually also individuals who go on to broader activities.” Last week, Israel’s Channel 10 broadcast what it said was footage from a recent “Islamic State gathering” on the Temple Mount in Jerusalem. The report said the gathering underlined that the Islamic State intends to focus on Israel in the future.

USA - Barclays Plc, Bank of America Corp, Citigroup Inc and 10 other banks were accused in a lawsuit of conspiring to manipulate ISDAfix, a benchmark used to set rates for interest rate derivatives and other financial instruments. The Alaska Electrical Pension Fund sued yesterday in Manhattan federal court, claiming the banks colluded to set ISDAfix at artificial levels that allowed them to manipulate payments to investors in the derivatives. The banks’ actions affected trillions of dollars of financial instruments tied to the benchmark, the pension fund said. The banks communicated using electronic chat rooms and other means of private communication, typically submitting identical rate quotes beginning at least in 2009, the Alaska fund said.

INDIA/PAKISTAN - Rescue teams are battling to retrieve hundreds of thousands of people stranded by damaging floods in India and Pakistan. The province of Punjab, where rivers are bursting their banks, is the worst-hit area in Pakistan. In Indian-administered Kashmir, the capital Srinagar is submerged with many residents waiting for rescue on rooftops. One week of flooding has left at least 280 people dead in both countries. Army and air force troops worked overnight to rescue marooned residents, officials in Indian-administered Kashmir said. There are fears that heavy rains and flooding could spread south to Pakistan's Sindh province over the next week.