Though markets and the economy are improving, efforts to provide a firm foundation for recovery will require increases to the US Treasury's conventional bonds going forward, as well as debt securities that are indexed to inflation. However, this expansion may take place in an environment WHERE INVESTORS CONSIDER LEAVING THE SAFE-HAVEN TREASURY MARKET FOR RISKIER ASSETS, and debt issuance is likely to level off mid next year, said Treasury Acting Assistant Secretary for Financial Markets, Karthik Ramanathan.

"In fiscal year 2009, which ends next week, TREASURY WILL HAVE ISSUED $7 TRILLION IN GROSS ISSUANCE - that's in a 12-month period," Ramanathan told a financial markets conference in New York. "This issuance was necessary to meet nearly $1.7 trillion in net marketable borrowing needs, nearly $1 trillion more than what we raised last year," he added.

As in the past, al-Qaida attempted to conflate Obama with his predecessor, George W Bush, who was widely disliked by Muslims for his invasions of Afghanistan and Iraq. Many analysts believe that al-Qaida has been alarmed by Obama's comparative popularity in the Middle East, especially following his landmark speech to the Muslim world in Cairo in June.

"America has come in a new, hypocritical face. Smiling at us, but stabbing us with the same dagger that Bush used," said Al-Qaida No 2 Ayman al-Zawahri in the message. "GOD WILLING, YOUR END WILL BE AT THE HANDS OF THE MUSLIM NATION, so that the world and history will be free of your crimes and lies," he said addressing Obama at the end of the two-part video.

The video's strident anti-American tone and detailed enumeration of what it describes as the US crimes was in sharp contrast to the earlier bin Laden message, which appeared to be an appeal to the American people to sever their ties with Israel and end the war with al-Qaida.

Iranian President Mahmoud Ahmadinejad last week offered a new assessment of the Holocaust - it is a lie - and of Israel's future prospects - it will soon be removed. This came as an unwelcome reminder to the Obama administration, and to the rest of the watching world, that THE UNITED STATES WOULD BE SITTING DOWN IN THE COMING WEEKS WITH A HOLOCAUST DENIER BENT ON NUCLEAR WEAPONIZATION. We trust the Americans will try nobly to convince Mr Ahmadinejad to do otherwise. But in between his launching of new uranium enrichment centrifuges and the arrest and torture of regime opponents, we sadly doubt the Iranian president will be persuaded.

In Afghanistan, Obama may be demonstrating some steely reserve, perhaps forced into it by the harsh reality of American blood on the line. This is commendable. It is less commendable that the administration cannot bring itself to reject outright last week's Goldstone Report, which condemns Israel for military actions both less severe and less numerous than those of American troops in Afghanistan, and does so on the basis of a grave misrepresentation of what unfolded in Gaza at the turn of the year.

It decimated the initial goodwill and admiration Obama enjoyed among the Israeli public by instigating a diplomatic crisis over something called "a stop to settlements... without exceptions." THIS ABSOLUTE DEMAND WAS ALWAYS UNREALISTIC AND THEREFORE COUNTERPRODUCTIVE. Hundreds of children are born each year in the suburbs of Jerusalem that step over the 1949 Green Line. Was the Jerusalem Municipality being asked to cease construction of kindergartens for them? Until the administration folded on this issue in July, the answer seemed to be yes.

By ratcheting up his demands of Israel beyond the point of viable agreement, and then FAILING TO OBTAIN ANY SUBSTANTIVE CONCESSIONS FROM ARAB LEADERS OR THE PALESTINIANS IN EXCHANGE, Obama actually walked into the most basic of Middle East peacemaking traps - encouraging the instinctive Arab resort to intransigence. After all, how could the Palestinians now demand less of the Israelis than the Americans? AND WITH A FULL-BLOWN DIPLOMATIC CRISIS APPARENTLY UNDER WAY BETWEEN ISRAEL AND AMERICA, WHAT INTEREST COULD ARAB LEADERS HAVE IN ENDING THE CRISIS THROUGH A DIPLOMATIC BREAKTHROUGH?

We might well ask why the administration is convinced that peace is being held up by settlements. Dozens of settlements have been dismantled and tens of thousands of settlers have been resettled in the Israeli withdrawals from Gaza and Sinai, while Palestinian rejection has only increased in response to apparent Israeli weakness. IN A WORLD THAT IS WONDERING INCREASINGLY WHETHER WASHINGTON IS WILLING AND ABLE TO ENFORCE ITS KEY VALUES AND EFFECTIVELY PROMOTE ITS VITAL INTERESTS, Obama plays host to Prime Minister Binyamin Netanyahu and Palestinian Authority President Mahmoud Abbas. And they will both be asking themselves a question neither would have anticipated eight months ago: CAN AMERICA BE RELIED UPON AND TAKEN SERIOUSLY?

THE SAUDIS TWICE SAID NO to his request for normalization gestures towards Israel (at Barack Obama's meeting with King Abdullah in Saudi Arabia, and in Washington at meetings with Hillary Clinton). Who says no to the American president twice? What must they think of Obama in the desert kingdom?

THE NORTH KOREANS SAID NO to repeated attempts at talks, by test-launching long-range missiles in April; RUSSIA AND CHINA KEEP ON SAYING NO to tougher sanctions on Iran; THE IRANIANS KEEP SAYING NO to offers of talks by saying they're willing to talk about everything except a halt to uranium enrichment; PALESTINIAN AUTHORITY PRESIDENT MAHMOUD ABBAS IS SAYING NO by refusing to meet with Binyamin Netanyahu until Israel freezes all settlement construction; THE ISRAELIS SAID NO by refusing to agree to a settlement freeze, or even a settlement moratorium until and unless the Arabs ante up their normalization gestures. Which brings us back to the original Saudi no.

The only thing Obama did manage to get Bibi and Abbas to say yes to is a photo-op at the Waldorf Astoria hotel in New York. Mazel tov. So why is everyone saying no to Obama? It's the economy, stupid.

Everyone has worked it out by now: The great secret is out. America's economy has made Obama a weak president, and he will likely remain weak throughout his first term. He has about two years to pull the American economy out of its free-fall before he begins his re-election campaign. If he can do it, and that's a big if, chances are good that he'll get re-elected, and in his second term he can try to pull some geopolitical strings. BUT FOR THE NEXT THREE YEARS, EXPECT TO SEE A WORLD THAT SAYS NO TO OBAMA. NO MEANINGFUL AND DRAMATIC DIPLOMATIC INITIATIVE CAN COME OUT OF THE WHITE HOUSE IN THE NEXT THREE YEARS, as long as Obama remains weak.

Much hope has been invested in Barack Obama's ability to strike a new course for the US following eight years of Bush administration unpopularity. Yet many in the US and abroad are impatient with the pace of progress under the Obama administration. The president made the rounds on five news talkshows on Sunday as he pressed his policies and vision, preparing for what is likely to be a difficult week.

Besides the ongoing battle over healthcare, this week SEES TWO SHOWDOWNS BETWEEN EUROPE AND THE US THAT WILL REVEAL FURTHER SLIPPAGE IN AMERICAN GLOBAL LEADERSHIP. The first showdown comes today at a UN special session on climate change in New York City; the second will come at the end of the week at the G20 meeting in Pittsburgh, where AMERICA AND EUROPE WILL BUTT HEADS over financial system reforms designed to ensure that the AIGs of the world can never again cause an economic collapse.

EUROPE HAS BEEN INCREASINGLY CRITICAL OF AMERICA'S FAILURES TO LIVE UP TO ITS GLOBAL RESPONSIBILITIES. The US is not only the world's largest emitter of greenhouse gases but is by far the largest per capita emitter of carbon and other pollutants. In response to American foot-dragging, European leader Jean-Claude Juncker said Europe should act on the bonus issue "whether the Americans are with us or not." He said that a Europe-only charge "will take on such force over time that the Americans will not be able to sit on the sidelines."

THE VERY STRUCTURE OF THE AMERICAN POLITICAL SYSTEM IS AT THE HEART OF THESE FAILURES. For example, thwarting Obama on a regular basis is an unrepresentative senate where "minority rule" prevails and undermines what a majority of the country may want. With two senators elected per state, regardless of population, California with more than 35 million people has the same number of senators as Wyoming with just half a million residents. This constitutional arrangement greatly favours low population states, many of which tend to be conservative, producing what one political analyst has called "a weighted vote for small-town whites in pickup trucks with gun racks."

In addition, the senate's use of that arcane rule known as the "filibuster" means you need 60 out of 100 votes to stop unlimited debate on a bill and move to a vote. A MERE 41 SENATORS, REPRESENTING AS LITTLE AS 20% OF THE NATION'S POPULATION, CAN STYMIE THE OTHER 80%. Given a vastly unrepresentative senate wielding its anti-majoritarian filibuster, it is hardly surprising that minority rule in the senate consistently undermines majority rule, whether on healthcare, financial industry reform, environmental legislation and many other policies.

Pile on to that an uncompetitive, winner-take-all electoral system, MARINATED IN MONEY AND SPECIAL INTEREST INFLUENCE, and the sclerotic US political scene is deeply troubling. None of these anti-democratic structural features are going away any time soon. Unless Barack Obama is able to demonstrate a better level of political skill than he has shown so far, everyone needs to fasten their seatbelts. The world is about to enter a challenging phase WHERE THE US – THE UNDISPUTED LEADER OF THE FREE WORLD FOR THE PAST 60 YEARS – IS GOING TO RAPIDLY CEDE ITS PLACE AT THE HEAD OF THE LINE.

IT APPEARS THAT THE WHEELS MAY BE COMING OFF THE WORLD'S POST-WAR LEADER, and not even Barack Obama can stop it happening.

"Will a day come when the Nones are on top? We can't predict for sure," says lead researcher Barry Kosmin. But if Nones, now 22% of all adults ages 18 to 29, continue to gain among young adults, to draw more people "switching out" from denominations and to replace more religious older people, researchers forecast one in five Americans will be Nones in 20 years.

"Trends clearly favor this," Kosmin says. But he also notes, "There could be a Great Awakening (massive Protestant revival) or immigration may bring in more Catholic believers." Kosmin and Ariela Keysar of Trinity College, Hartford, Connecticut, directed three editions of the American Religious Identification Survey over 18 years. The 2008 ARIS (pdf), based on a sampling of 54,000 US adults, also burrowed in for a closer look at 1,106 Nones, who answered extra questions about their beliefs and behaviors and views on God.

One quirky fact: 33% of Nones claim Irish ancestry, although the US Census says only 10% of the USA does. "We have no idea why," he says. "Maybe you could ask (Fox newscaster) Bill O'Reilly. In some way, researchers found Nones are very much like the overall, largely religious, US population. There's no statistical difference on education, or income or marital status. They are just as likely to be divorced as anybody else. Nones are not a fringe group anymore and are now part of Middle America. They're present in every socio-demographic group", Keysar concludes in their report.

Observers have traditionally used the number of sunspots on the surface of the Sun to measure its activity. The number of sunspots reaches a peak at what is called the solar maximum, then declines to reach a minimum during a cycle. At the peak, intense solar flares and geomagnetic storms eject vast amounts of energy into space, crashing into the Earth's protective magnetic fields, knocking out satellites, disrupting communications and causing colorful aurorae.

But scientists at the National Center for Atmospheric Research in the United States and the University of Michigan found that the EARTH WAS BOMBARDED WITH INTENSE SOLAR WINDS LAST YEAR DESPITE AN UNUSUALLY QUIET PHASE FOR THE SUN. "The Sun continues to surprise us," said Sarah Gibson of the center's High Altitude Observatory and lead author of the study. "The solar wind can hit Earth like a fire hose even when there are virtually no sunspots."

Scientists previously thought the streams of energy largely disappeared as the solar cycle approached the minimum.

"THAT'S THE NEXT ROUND OF POTENTIAL FORECLOSURES IN OUR COUNTRY," he said. Option-ARMs are now considered among the riskiest offered during the recent housing boom and have left many borrowers owing more than their homes are worth. These "underwater" mortgages have been a driving force behind rising defaults and mounting foreclosures. The mortgages differ from other ARMs by offering an option to PAY ONLY THE INTEREST each month or a low minimum payment that leads to a rising balance in the loan's principal.

When the balance of the loan reaches a certain level or the mortgage hits a specific date, the borrower must begin making full payments to cover the new amount. The loan's interest rate also may have been fixed at a low level for the first few years with a so-called teaser rate, but then reset to a higher level. Because the new monthly PAYMENTS CAN BE FIVE OR 10 TIMES WHAT BORROWERS ARE ACCUSTOMED TO PAYING, they "threaten a much greater hit to the consumer than the subprimes," Goddard said, referring to the mortgages often extended to less credit-worthy borrowers that fed the first wave of the financial crisis.

The US housing market has suffered the worst downturn since the Great Depression, and its impact has rippled through the recession-hit economy.

"No power in the world is daring enough to attack Iran as we are more experienced and powerful than ever," Ahmadinejad said. Hundreds of troops marched past the official podium packed with top officials, followed by military hardware including Ghadr, Sejil and Shahab-3 long-range missiles which are made in Iran.

Television commentators said the Shahab-3 missile had a range of 2,000 km (1,250 miles), putting Israel within striking distance. Shorter range missiles, unmanned planes and locally made jet fighters - Saegheh and Azarkhsh, artillery and rockets were also on display. The United States and its allies are seeking to intensify UN sanctions on Iran over the Islamic country's disputed nuclear programme, which the West fears is intended to build nuclear weapons. Iran has repeatedly denied this.

Iran has repeatedly condemned the military presence of the US and its allies in neighboring countries. "The roots of all conflicts in the region is the presence of foreign troops," Ahmadinejad said. Washington and Israel do not rule out military action against Iran over the nuclear issue. TEHRAN IS DUE TO HOLD TALKS ON OCTOBER 1 WITH MAJOR WORLD POWERS over concerns about the Islamic Republic's nuclear strategy.

A document outlining the US position ahead of the September 24-25 Group of 20 summit in Pittsburgh said exporters, which include China, Germany and Japan, should consume more, while debtors like the United States ought to boost savings. "The world will face anemic growth if adjustments in one part of the global economy are not matched by offsetting adjustments in other parts," said the document, which was obtained by Reuters on Monday.

GERMANY, A MAJOR EXPORTER TO THE UNITED STATES, was singled out on Sunday by US President Barack Obama as a country that, like China, EXPORTS A LOT BUT DOES NOT BUY MUCH BACK. But a top European Union official said that the euro zone, where 16 countries share a common currency, had to act as a collective. "It is difficult to think about one country without taking into consideration what is the impact in the euro area," European Commission President Jose Manuel Barroso told reporters in New York.

Taxpayer money to the tune of $5 trillion has been pumped into the world economy to keep it from seizing up since the beginning of the crisis last September. G20 leaders will maintain that pace of stimulus while acknowledging that at some point it will have to be wound down, the document said. But, mindful of how a disorderly rush to raise interest rates could roil world markets again, THEY WILL ALSO ASK FINANCE MINISTERS TO THRASH OUT A "TRANSPARENT AND CREDIBLE" EXIT STRATEGY.

The downgrading of expectations comes as RELATIONS BETWEEN THE US AND EUROPE, WHICH STARTED THE YEAR OF TALKS AS ALLIES, NEAR BREAKDOWN. In Brussels, European Union officials have grown increasingly frustrated at the US stance, saying it has fallen short on both its level of ambition to reduce emissions and on offering aid to developing nations.

"So far, we thought the basic problem was the Chinese and the Indians. But now I think THE PROBLEM APPEARS TO LIE MOST CLEARLY WITH THE US," a European Commission official said. Talks were "not going well". European officials say the Obama administration lacks focus because its top talent is wrapped up in the all-consuming debate over healthcare.

As the EUISS writes, the "full spectrum of high intensity combat" must be applied to stabilize the "global class society". According to a recent study published by the EU's "Institute for Security Studies" (EUISS) future wars will not be fought between states, but between "unequal global socioeconomic classes of society". On one side of this "hierarchical class society" are the metropolitan elite, consisting of transnational corporations, the OECD member states and the "rapid transition states" India, China and Brazil. These are confronted with "increasingly explosive tensions" from the other side, the global poor. To prevent a "global systemic collapse", the INSTITUTE CALLS FOR APPLYING THE "FULL SPECTRUM OF HIGH INTENSITY COMBAT" AGAINST THE "BOTTOM BILLION".

PREVENTING THE INFLUX OF THOSE FLEEING THE MISERY OF THE SOUTH is a "major military task," writes the EUISS. Large scale "barrier operations" must be aimed at "shielding the global rich from the tensions and problems of the poor". The EUISS estimates that the ratio of the world's population "living in misery and frustration" will continue to rise. Therefore the EU must reinforce its already rigid border regime.

For the EUISS, warding off economic refugees is directly linked to the management of global ecological crises. Natural catastrophes, caused by climatic change, could lead to "sudden refugee or migration flows within the EU", which would call for military management. The EUISS THEREFORE CALLS ON THE RICH NATIONS OF THE NORTH, TO USE "MORE ROBUST POWER" TO "PROTECT" NATURAL RESOURCES, SUCH AS TROPICAL RAIN FORESTS AND FISH BREEDING AREAS IN THE POVERTY-STRICKEN REGIONS OF THE SOUTH, against unwanted seizure, because they are "universal treasures, BEYOND THE SOVEREIGN JURISDICTION OF ANY SINGLE STATE."

The EUISS, on whose behalf Weis reached his conclusions, was inaugurated in Paris in early 2002. As an "autonomous agency" - as it calls itself - it is elaborating projects for the European Security and Defense Policy, ESDP. GERMANY IS HOLDING A STRATEGIC POSITION IN THIS AGENCY.

"Fears are growing in Brussels that Klaus intends to find an excuse to delay signing as long as possible - certainly, until some time in the first half of next year. THE EU WILL THEN FACE ITS ULTIMATE NIGHTMARE - that the Lisbon treaty will not have been ratified by the time that the UK holds its next general election, due by June."

EUobserver reports that French President Nicolas Sarkozy has warned the Czech Republic that it will have to face "consequences" if it delays final ratification of the Lisbon Treaty, if Ireland votes Yes on 2 October. He described Czech PM Jan Fischer as a "man of great quality", but added "I stated clearly that if the Irish say Yes, there is no question that we will accept to stay in a no man's land with a Europe that does not have the institutions to cope with the crisis. It will be necessary to draw the consequences - but those will be the subject of another meeting."

DPA reports that Jan Fischer said yesterday that ratification of the Lisbon Treaty could take up to six more months in his country. Meanwhile, writing in the Irish Times Tony Allwright looks at the 'guarantees' offered to Ireland on taxation and neutrality and argues, "they only nibble at the treaty's edges, and studiously avoid the rotten core to which so many people fundamentally object." He goes on to list four reasons to vote 'No', and four reasons not to vote 'Yes', including "THE DISHONESTY OF HAVING CONVERTED THE READABLE, UNDERSTANDABLE, IF INTERNALLY CONTRADICTORY TREATY ESTABLISHING A CONSTITUTION FOR EUROPE INTO THE LISBON REFORM TREATY."

Declan Ganley and Eamon Dunphy, a well-known Irish broadcaster, yesterday appeared on Tom McGurk's 4FM radio show to debate the Lisbon Treaty. Dunphy, who voted No in last year's referendum, said that the economic crisis had shown that Ireland could no longer govern itself and that it couldn't afford to vote No again because it had lost its "capacity for independence".

Handelsblatt quotes Ganley saying that the suggestion that the fate of Ireland's economy is dependent on the Lisbon Treaty is a "huge lie" and the common form of "INTIMIDATION FROM BRUSSELS". The Irish Independent reports that former Irish PM Garret FitzGerald said yesterday that Ganley's return to the No side won't affect the campaign.

Writing on the Guardian's Comment is Free, Foreign Affairs Columnist Simon Tisdall notes, "It's plain the Irish have not suddenly fallen back in love with Brussels; many reservations remain... The key difference between now and June last year is Ireland's transformation from Celtic tiger to timid puss. What happened is the recession happened. THE REFERENDUM IS NOT ABOUT PRINCIPLES, IF IT EVER WAS; IT'S ABOUT FEAR."