The U.S. Geological Survey said the quake had a magnitude of 5.7 and was centered 90 miles (140 kilometers) southeast of the capital. The Mexican seismological service measured it at 5.9. Many ran outside across the metropolis of 20 million. Evacuation officials steered crowds away from power lines and other potential hazards, and anxious people waited for several minutes before returning indoors.

FRIDAY'S EARTHQUAKE WAS STRONGER AND CLOSER TO THE CAPITAL THAN ONE THAT HIT LAST MONTH. But Bruce Tresgrave of the U.S. Geological Survey said it was 35 miles (56 kilometers) below ground — deeper than normal — and thus unlikely to cause major damage.

Mexico City Mayor Marcelo Ebrard also said no damage was reported, and the capital's water system, hospitals and subway were not affected. Officials were conducting a more detailed survey. The capital has lived through powerful earthquakes, including one in 1985 that killed as many as 10,000 people. Parts of Mexico City rest on the shaky soil of a former lake bed, which tends to magnify the effect of earthquakes.

The latest banks seized were Strategic Capital Bank and Citizens National bank, both in Illinois. The Federal Deposit Insurance Corp will continue to insure regular deposit accounts of up to $250,000 at both banks. The Illinois Department of Financial and Professional Regulation's banking division took over Strategic Capital Bank, based in Champaign, Illinois, while the Office of the Comptroller of the Currency took control of Citizens National Bank, based in Macomb, Illinois. The FDIC was appointed receiver of both banks.

The closures brought this week's total to three, after federal regulators seized struggling Florida thrift bank United FSB on Thursday. That closure was expected to cost the FDIC $4.9 billion, representing the second-largest hit to the FDIC's insurance fund since the financial crisis began felling banks last year.

The costliest was last year's seizure of California lender IndyMac Bank, on which the bank insurance fund is estimated to have lost $10.7 billion. The closure of Strategic Capital Bank is expected to cost the FDIC $173 million, while Citizen National Bank's closure will cost about $106 million. The list of bank failures is growing as falling home prices and rising unemployment cause more individuals and businesses to default on their debt. THE 36 BANK FAILURES THIS YEAR (SO FAR) IN THE US COMPARE WITH 25 IN 2008 AND JUST THREE IN 2007.

PA sources said giving up claims to the Temple Mount and handing over control to the 57-member Saudi-based Islamic Conference Organization is conditional on Israel's agreeing to a final status agreement. Iran, which is classified as Persian and not an Arab country, is part of the Islamic group. Prime Minister Binyamin Netanyahu has opposed agreeing to a new PA state without knowing ahead of time what it would entail.

THE PA RECENTLY HAS ESCALATED ITS PROPAGANDA CAMPAIGN THAT DISASSOCIATES THE HOLY SITE FROM ANY CONNECTION WITH JUDAISM AND CLAIMS IT IS SOLELY A MUSLIM SITE. The PA's official website as far back as 2005 rejected the Jewish connection with the Western Wall (Kotel), the remains of the wall that surrounded the Holy Temple area. Muslim legend claims that Mohammed tied his horse to the wall before ascending to heaven, even though the city of Jerusalem is not even mentioned in the Koran.

Writer Daniel Pipes for several years offered one million dollars to anyone who can find the name "Jerusalem" explicitly written in the Koran. Rabbi Richman said that the PA's denial of the Jewish Temple's existence "is part of a campaign to totally eradicate, erase, and destroy all Jewish connection to the Temple Mount, Jerusalem and the land of Israel." The PA incitement against Israel, WHICH VIOLATES THE AMERICAN ROADMAP PLAN, also attributes the 1929 Arab pogrom to Jewish efforts to claim ownership of the Western Wall.

Germans have reacted with alarm to the new annual report on POLITICALLY MOTIVATED CRIMES from the Office for the Protection of the Constitution, the country's domestic intelligence agency. According to the report there were 19,894 far-right crimes reported in Germany in 2008 - an increase of almost 16 percent over the previous year. German commentators were unanimous in their calls on the federal government to do more to fight right-wing extremism.

THE CENTER-LEFT SÜDDEUTSCHE ZEITUNG WRITES:
The vast majority of the Germany population supports democracy. They don't allow themselves to be easily seduced by the enemies of the state; indeed, after the experiences of World War II, THEY BELONG TO ONE OF THE WORLD'S MOST PEACE-LOVING SOCIETIES. It's hard not to be bothered by the almost accountant-like lack of emotion with which Schäuble delivers the Office for the Protection of the Constitution's report year after year. The rising number of far-right crimes and acts of violence calls for a bit more passion. Without it, it will be hard to reverse this horrifying trend.

THE CONSERVATIVE DIE WELT WRITES:
Anti-Semitic conspiracy theories have been spreading with increased vigor since the beginning of the global economic crisis. But to assume from these facts that Germany is somehow heading 'right' would be nothing more than fearmongering. The Office for the Protection of the Constitution puts the figure of far-right extremists in Germany at 30,000, out of whom 4,800 are neo-Nazis. Germany's democracy can bear up against that many cretins.

THE LEFT-LEANING BERLINER ZEITUNG WRITES:
Interior Minister Wolfgang Schäuble gets all excited when it comes to things like amending the constitution to let Germany combat pirates. And, for him, deploying military forces within Germany is an urgent matter, just like rolling back data privacy protections to aid in the fight against terrorism. YOU WOULD HOPE THAT HE WOULD BRING THE SAME ZEAL TO THE ISSUE OF FAR-RIGHT EXTREMISM - and not just when it comes to gathering information and conducting surveillance.

The United States will face a downgrade in "at least three to four years, if that, but the market will recognize the problems before the rating services - just like it did today," Gross told Reuters.

Gross, the co-chief investment officer of Pacific Investment Management Co and manager of the Pimco Total Return Fund, which has $154 billion in assets, earlier had told Reuters via email that market declines on Thursday were due to investor fears THAT THE UNITED STATES IS "GOING THE WAY OF THE UK - losing AAA rating which affects all financial assets and the dollar."

Standard & Poor's on Thursday lowered its outlook on Britain to "negative" from "stable," threatening the nation's top AAA rating. Britain faces a one in three chance of a ratings cut as debt approaches 100 percent of gross domestic product.

European shares fell as S&P's potential UK credit cut added to worries sparked by news on Wednesday that Federal Reserve policy-makers had cut their US growth forecasts over the next three years. The pan-European FTSEurofirst 300 index of top shares fell 2.1 percent to 857.52 points, breaking five successive sessions of gains.
US equities also slumped, and Treasuries and the dollar - which typically rise on a bid for assets perceived as lower risk when stocks fall - also declined as worries about swelling US deficits soured investors on US assets.

The US Marshals confirmed it disconnected from the Justice Department's computers as a protective measure after being hit by the virus; an FBI official said only that that agency was experiencing similar issues and was working on the problem. "We too are evaluating a network issue on our external, unclassified network that's affecting several government agencies," said FBI spokesman Mike Kortan. He did not elaborate or identify the other agencies.

Marshals spokeswoman Nikki Credic said the agency's computer problem began Thursday morning. The FBI began experiencing similar problems earlier. "At no time was data compromised," said Credic. The type of virus and its origin were not determined. In addition to their external networks, most federal law enforcement agencies have an internal-only network to prevent cyber-snoopers from sensitive data.

In Thursday's incident, the Marshals Service shut down its Internet access and some e-mail while staff worked on the problem. The FBI made similar moves to protect its system.

"JERUSALEM WAS ALWAYS OURS AND WILL ALWAYS BE OURS. It will never again be partitioned and divided," Netanyahu said at the official state ceremony marking Jerusalem Day and the reunification of the capital during the Six Day War 42 years ago. "Only under Israeli sovereignty will united Jerusalem ensure the freedom of religion and freedom of access for the three religions to the holy places," he added.

The prime minister prefaced his remarks with a reference to his meetings with US President Barack Obama and other American officials earlier in the week, saying he had made the same declarations during that trip. In an earlier address, President Shimon Peres said that Jerusalem, while sacred to others, is the only capital Israel and the Jewish people have ever known. "Jerusalem is held sacred by half of mankind [but] it has been and always will be Israel's capital. We never had another and it has never been the capital of any other people."

It means there were 64,715 abortions performed last year where the women had been through at least one previously. The figures show in 2,780 cases the abortion was the woman's fourth, in 739 cases it was the fifth, in 168 cases it was the sixth abortion and 68 women were having their seventh termination and 46 women had already been through seven or more abortions.

The number of children born in England and Wales from mothers originating from outside the UK has reached an all time high, figures showed today. There were 708,708 live births in 2008, the highest since 1973 when there were 725,440, of which 24 per cent of babies were to mothers born outside the UK.

Women are now having 1.95 children each on average, the highest figure since 1973 when there was an average of two children per woman. In 2007, the figure was 1.92 children per woman. The proportion of babies delivered to mothers born outside the UK continued to rise, the data showed, compared with 23 per cent in 2007 and 14 per cent in 1998.

California faces thousands of job cuts and deep spending cuts to state health, education and other services as the nationwide economic slump has reduced tax revenues. On Wednesday, voters soundly defeated ballot measures to bolster the state's finances, leaving Governor Arnold Schwarzenegger and lawmakers facing a budget gap of more than $21 billion.

Early Thursday, US Treasury Secretary Timothy Geithner during testimony before a House of Representatives Appropriations subcommittee, said the Treasury was not able to tap the $700 billion Troubled Asset Relief Program for bank bailouts to help California. Last week Schwarzenegger said the government of the most populous state in the United States faced a shortfall of $15.4 billion for its next fiscal year even if voters approved fiscal ballot measures in Tuesday's special election, underscoring the severe downturn in state revenue amid recession and double-digit unemployment.

With the measures defeated, California now faces a $21.3 billion deficit, according to Schwarzenegger, who with the state's Democrat-led legislature put the measures to voters as part of a February budget compromise to close a nearly $42 billion shortfall through June 2010. "The public is under the delusion that they can have everything - potholes filled, new freeways, a good education system - but they aren't willing to pay for it... A LOT OF CRITICAL SERVICES ARE GOING TO BE CUT AND THERE WILL BE SERIOUS CONSEQUENCES," said Jim Hawley of the Elfenworks Center for the Study of Fiduciary Capitalism at St Mary's College of California.

He also said that "UNTIL THE PRICE OF HOMES FLATTENS OUT WE STILL HAVE A VERY SERIOUS POTENTIAL MORTGAGE CRISIS." Greenspan's comments suggest he sees a bigger capital shortfall in the banking system than reflected in regulators' stress tests on the 19 biggest U.S. lenders. Treasury Secretary Timothy Geithner told lawmakers yesterday that banks have issued more than $56 billion in new stock or debt since the tests found 10 firms needed to raise about $75 billion.

A lack of capital at banks may inhibit lending to consumers and businesses, tempering any economic recovery. The former Fed chief, who left the central bank in 2006, said that the continued slump in home prices is putting at risk millions of borrowers.

"WE'RE ON THE EDGE and if this thing doesn't get resolved quickly I'm worried," he said before a meeting with House of Representatives members on financial regulation that was organized by the Washington-based Bipartisan Policy Center.

The men were held on Wednesday night while attempting to carry out a plot to bomb two synagogues in the Bronx and use stinger missiles to shoot down military planes near an Air National Guard base in Newburgh. "The defendants wanted to engage in terrorist attacks. They selected targets and sought the weapons necessary to carry out their plans," Lev Dassin, acting US attorney for the Southern District of New York, said in a statement.

The four men, named by police as James Cromitie, David Williams, Onta Williams and Laguerre Payen, were arrested after buying inactive missiles and inert explosives in a sting operation run by the FBI and other government agencies. They are accused of planning to detonate explosives near a synagogue in the Riverdale section of New York's Bronx borough and to shoot down planes located at New York's Air National Guard base at Stewart airport in Newburgh, New York some 70 miles north of New York City.

All four are charged with one count of conspiracy to use weapons of mass destruction within the United States, which carries a maximum penalty of life in prison, and one count of conspiracy to acquire and use anti-aircraft missiles, which also carries a maximum penalty of life in prison.

CREDIT RATINGS ARE CRUCIAL AS THEY HELP DETERMINE THE COST OF BORROWING. It came as data confirmed that new government borrowing has soared, to a record of almost £8.5bn in April. The Office for National Statistics (ONS) said public sector net borrowing rose to £8.46bn this April compared to £1.84bn in the same month last year.

Government coffers have been hit by higher social benefits payments and lower tax receipts as the economy was hit by the slowdown. The ratings agency said THAT THE UK'S PUBLIC FINANCES WERE DETERIORATING RAPIDLY, "at a faster rate than Standard and Poor's had previously assumed."

Standard and Poor's said the UK's triple-A rating was at risk without a credible plan to put its debts on a "secure downward trajectory" by the next government. S&P said that government debt could reach 100% of GDP by 2013 - a level it said was incompatible, if sustained, with the top credit rating. Currently, public debt is 53% of GDP, according to the latest ONS figures. The new outlook for the UK could lead to higher borrowing costs if it makes international investors less likely to buy UK Treasury bonds.

Ashraf Laidi, chief market strategist at CMC Markets, said Wednesday a "serious case of dollar damage" was underway. "WE LONG WARNED ABOUT THE DAY OF RECKONING FOR THE DOLLAR EMERGING AT THE NEXT ECONOMIC RECOVERY," Mr. Laidi said in a note. Mr. Laidi said economic recovery would weigh on the greenback as real demand for commodities, coupled with improved risk appetite, caused investors to seek higher yields in emerging markets and commodity currencies. This would draw investment away from the U.S. dollar, which was dragged down by growing debt and the risk quantitative easing would eventually spark a surge in inflation.

Concern has been mounting that the increasing U.S. debt load, as well as A POTENTIAL INFLATION TIME BOMB in the form of the quantitative easing, could drag down the greenback. Garnering attention is the risk the UNITED STATES COULD LOSE ITS TRIPLE-A SOVEREIGN CREDIT RATING, which reflects the chance of the borrower defaulting on its debt.

"By many measures, THE U.S. APPEARS JUST A FEW SHORT STEPS AWAY FROM LOSING ITS COVETED TRIPLE-A STATUS, unless the recovery turns out to be considerably stronger than expected and the fiscal repair is faster than commonly expected," said Douglas Porter, deputy chief economist at BMO Capital Markets. "A downgrade could boost the cost of funding U.S. debt at the margin, but underlying inflation and fiscal fundamentals will ultimately be the primary driver."

However, he said a big threat lurked in the country's expanded monetary base, which now stands at about US$1.8-trillion. While the expanded monetary base was needed to feed economic growth and ward off deflation under the Fed's quantitative easing plan, Mr. Ashworth said SUCH HIGH LEVELS COULD FUEL RAMPANT INFLATION ONCE BROADER MONETARY CONDITIONS IMPROVED. He said it remained to be seen how much success the Fed will have when it decides to end its quantitative-easing plan and shrink the monetary base

Ron Dermer spoke to The Associated Press after Netanyahu and his entourage arrived home from Washington. He denied that he meant that the two-state concept itself childish and stupid, as he was quoted earlier as saying in an anonymous briefing to journalists on the plane carrying Netanyahu home. "I told reporters that the focus by the media on the concept of solving the Israel-Palestinian issue through a two-state solution is childish and stupid, but I deny that I described the idea that way," he said.

During his trip to Washington, Netanyahu constantly tried to shift emphasis from Israeli-Palestinian peacemaking toward the threat posed by Iran's nuclear program. He and Obama publicly disagreed about the relative weight of the two issues. Netanyahu argued that reining in Iran would spur peace efforts, while Obama felt that progress toward peace between Israel and the Palestinians would undermine extremist elements, including Iran.

In a brief statement at Israel's airport on his return, Netanyahu again began with Iran, mentioning the Palestinian issue as third on his list. Referring to his talks with Obama, Netanyahu said, "There was an agreement that we need to immediately begin the peace process, I said I am willing to open peace talks with the Palestinians, by the way with the Syrians as well, of course without preconditions, but I made it clear that in any peace agreement there must be a solution to Israel's special security needs."

He also said that Arab nations should be brought into the peacemaking process, "meaning not only does Israel need to contribute and the Palestinians contribute, but Arab states need to make concrete contributions already at the beginning of the process."