Although his office denies that he was part of the official party, it is probably no coincidence that he happened to be in the same part of the world at the right time. THAT IS HOW THE ROTHSCHILDS HAVE WORKED FOR CENTURIES: QUIETLY, WITHOUT FUSS, BEHIND THE SCENES. "We have had 250 years or so of family involvement in the finance business," says Baron Rothschild. "We provide advice on both sides of the balance sheet, and we do it globally." Gradually the firm has started expanding throughout the world, including the Gulf. "THERE IS NO DEBATE THAT ROTHSCHILD IS A JEWISH FAMILY, but we are proud to be in this region. However, it takes time to develop a global footprint," he says.

The Rothschilds have been helping the British government – and many others – out of a financial hole ever since they financed Wellington's army and thus victory against the French at Waterloo in 1815. In the 1820s, the Rothschilds supplied enough money to the Bank of England to avert a liquidity crisis. THE ROTHSCHILD DYNASTY HAS LOST NONE OF ITS LUSTRE OR INFLUENCE. So it was no surprise to meet Baron Rothschild at the Dubai International Financial Centre. Rothschild's opened in Dubai in 2006 with ambitious plans to build an advisory business to complement its European operations.

BARON ROTHSCHILD SHARES MOST PEOPLE'S VIEW THAT THERE IS A NEW WORLD ORDER. In his opinion, banks will deleverage and there will be a new form of global governance. "But you have to be careful of caricatures: we don't want to go from ultra liberalism to protectionism."

So how did the Rothschilds manage to emerge relatively unscathed from the financial meltdown? "You could say that we may have more insights than others, or you may look at the structure of our business," he says. "As a family business, we want to limit risk. There is a natural pride in being a trusted adviser." It is that role as trusted adviser to both governments and companies that Rothschilds is hoping to build on in the region. "In today's world we have a strong offering of debt and equity," he says. "They are two arms of the same body looking for money."

The firm has entrusted the growth of its financing advisory business in the Middle East to Paul Reynolds, a veteran of many complex corporate finance deals. "WE WORK IN A PURELY ADVISORY CAPACITY. We don't lend or underwrite, because that creates conflicts. We are sensitive to banking relationships. But we look to ensure financial flexibility for our clients." It is part of Rothschild lore that its founder sent his sons throughout Europe to set up their own interlinked offices. So where would Baron Rothschild send his children today? "I would send one to Asia, one to Europe and one to the United States," he said. "And if I had more children, I would send one to the UAE."

DOZENS OF SUSPECTED TERRORISTS HAVE ATTEMPTED TO INFILTRATE BRITAIN'S TOP LABORATORIES in order to develop weapons of mass destruction, such as biological and nuclear devices, during the past year. The security services, MI5 AND MI6, HAVE INTERCEPTED UP TO 100 POTENTIAL TERRORISTS POSING AS POSTGRADUATE STUDENTS who they believe tried accessing laboratories to gain the materials and expertise needed to create chemical, biological, radiological and nuclear weapons, the government has confirmed.

It follows warnings from MI5 to the Foreign and Commonwealth Office that al-Qaeda's terror network is actively seeking to recruit scientists and university students with access to laboratories containing deadly viruses and weapons technology. THE FINDINGS RAISE QUESTIONS OVER HOW MANY TERRORIST SUSPECTS MAY HAVE ALREADY INFILTRATED THE UK'S LABORATORY NETWORK. Rihab Taha, dubbed 'Dr Germ', who worked on Saddam Hussein's biological weapons programme, studied for her PhD in plant toxins at East Anglia University's School of Biological Sciences in Norwich.

In addition, a number of well-educated Iraqi scientists - funded by Baghdad - infiltrated several British microbiology laboratories in the run-up to the Gulf war of 1990-91. Britain has about 800 laboratories in hospitals, universities and private firms where staff have access to lethal viruses such as Ebola, polio and avian flu or could acquire the technology and expertise to develop deadly weapons. Whitehall sources remain concerned about the number of countries intent on acquiring the materials and knowledge to develop a nuclear or biological warfare capability.

"UNFORTUNATELY, RELIGION CAN BE MISUNDERSTOOD AND USED TO PROVOKE VIOLENCE AND DEATH," the [Pontiff] noted. To avoid this, it is necessary to promote "respect of the sensitivity and history of each country and every human and religious community" through "multilateral consultations and meetings." But before all, he added, there is a need for "A GENUINE DESIRE TO SEEK THE PEACE that will promote the reconciliation of peoples and peaceful co-existence among everyone."

"This is what the Holy See asks, and knows that this is also the desire of Egypt," affirmed the Bishop of Rome. He praised "the efforts carried out by Egypt and its government officials to gradually reach this noble objective." He added: "Egypt is in the vanguard in the search for bridges between peoples and religions. Such relationships are certainly based on a profound mutual respect of our proper identities, but also and above all, on a genuine desire to promote unity and peace, both within national borders and within international spaces."

Benedict XVI affirmed that Egypt "has always been known as a land of welcome for innumerable refugees, Muslims and Christians, who have sought security and peace in your land. May this noble tradition continue for the well-being of everyone."

The prosecutors claim that repeated arguments between the parents, who cannot be named under Italian privacy laws, induced a "syndrome of anxiety and depression". This led to problems of concentration and him falling behind with his school work. The child was apparently left confused and with the conviction that his parents hated each other.

A Milan prosecutor brought the case after a health visitor reported that the child was "disturbed". Antonio Sangermano, the magistrate who is conducting the case, said that THE MOTHER AND FATHER HAD BLAMED EACH OTHER FOR THEIR BREAK-UP IN ARGUMENTS CARRIED OUT IN FRONT OF THE CHILD. The prosecution report said: "Each blamed the other for shortcoming and educational errors in bringing up the child." Each parent, it went on, tried to discredit, devalue and undermine the other in front of the child and "project their emotions on to him - above all, anger".

THEY MANIPULATED THE CHILD IN AN ATTEMPT TO MAKE HIM DECIDE BETWEEN THEM, USING HIM AS A TOOL IN THEIR BATTLE, the prosecutors said. Cesare Tacconi, a Milan judge, will decide early next month whether to send the case to trial.

"The day after the election, I had many more calls than usual from people looking for semi-automatic rifles," said David Greenberg, the owner of the Second Amendment Family Gun Shop, in Bisbee, Arizona, who sold out of AR-15 rifles in recent days. "THERE SEEMS TO BE A FEAR THEY WILL BE BANNED, AND IT'S FAIRLY LIKELY," he added. "Obama and Biden are driven to eliminate firearms from the face of the country."

Gun stores and trade groups have reported a spike in firearms sales in the run-up to the November 4 election victory of Democrat Obama and Vice President-elect Joe Biden, who many perceive as strongly pro-gun control. The National Shooting Sports Foundation, a trade association for the shooting, hunting and firearms industry, reported a 10 percent jump in gun sales this year based on its analysis of an excise tax placed on firearms and ammunition, and a spokesman said the increase had grown dramatically ahead of the election.

"GUN OWNERS ARE AFRAID OF WHAT OBAMA IS GOING TO DO AS FAR AS GUNS," said spokesman Tony Aeschliman. "He has a clear record of being against us."

The Federal Deposit Insurance Corp. was appointed receiver of Franklin Bank, which had $5.1 billion in assets and $3.7 billion in deposits as of Sept. 30, and of Security Pacific Bank, with $561.1 million in assets and $450.1 million in deposits as of Oct. 17. The co-founder and chairman of parent Franklin Bank Corp., Lewis Ranieri, is credited with inventing mortgage-backed securities two decades ago, but apparently was unable to save his own company from getting ensnared in the home-loan bust.

The bank's failure is a bitter irony because it is THE MORTGAGE SECURITIZATION BUSINESS OF WHICH RANIERI IS KNOWN AS A PIONEER — THE REPACKAGING OF HOME LOANS AS BONDS THAT ARE SOLD TO INVESTORS, that was at the heart of the mortgage and credit crises. Last spring, the audit committee of the company's board found in an investigation certain weaknesses in accounting, disclosure and other issues relating to residential real estate loans.

Franklin Bank Corp. just Sunday said it had received proposals for transactions to strengthen Franklin Bank's capital position and was keeping regulators informed of the talks' progress. The 19 bank failures so far this year compare with three for all of 2007 and are more than in the previous five years combined. It's expected that many more banks won't survive the next year of economic tumult. The pressures of tumbling home prices, rising mortgage foreclosures and tighter credit have been battering many banks, large and small, across the nation.

Abu Omar al-Baghdadi, self-styled head of the Al Qaeda front group the Islamic State of Iraq, said in a speech posted on an extremist Web site that it would be better "for you and us" to "withdraw your forces," according to the SITE Intelligence Group that monitors militant Web sites.

"YOU DO NOT INTERFERE IN THE AFFAIRS OF OUR COUNTRIES," he continued in an apparent reference to Muslim dominated nations. "WE, IN TURN, WILL NOT PREVENT COMMERCE WITH YOU, WHETHER IT IS IN OIL OR OTHERWISE." Al-Baghdadi blamed the global financial crisis on the wars "launched in Muslim countries" and said he was issuing the call on behalf of "my brothers in Iraq, Afghanistan, Somalia, and Chechnya," SITE said.

The U.S. military says al-Baghdadi is an actor who provides a voice for Al Qaeda in Iraq propaganda. In a separate statement, the Mujahedeen Army, a Sunni insurgent group, urged Obama to withdraw U.S. troops from Iraq or face "DAYS THAT WILL BE MORE DIFFICULT THAN THE NIGHTMARE EXPERIENCED BY HIS PREDECESSOR."

More and more boys are being born with GENITAL DEFECTS and are suffering from LEARNING DISABILITIES, AUTISM AND TOURETTE'S SYNDROME, among other disorders. HIGH MISCARRIAGE RATES AND AN UNUSUALLY HIGH number of children suffering from asthma were also noted by researchers.

Male infertility rates are on the rise and the quality of an average man's sperm is declining, according to some studies. But perhaps the most disconcerting of all trends is the growing gender imbalance in many parts of heavily industrialized nations, where the BIRTHS OF BABY BOYS HAVE BEEN DECLINING FOR MANY YEARS.

Although the link between pollutants and human reproduction has not been firmly established, there is growing evidence that the birth sex ratio can be altered by exposure to certain chemicals, such as dioxin, PCBs and pesticides. Brophy said studies done in the United States, Japan and Europe seem to support the theory that the so-called endocrine disrupting chemicals have a particular effect on males.

The Labor Department said on Friday the jobless rate rose a steep four-tenths of a percent to 6.5 percent in October, the highest since March 1994, and that job losses in September and August were deeper than previously thought. So far this year 1.2 million U.S. jobs have been lost, with 651,000 in the past three months alone as the slide in the national labor market picked up in intensity.

"WE HAVE ENTERED THE PHASE OF SERIOUS RECESSION CONDITIONS. UNFORTUNATELY WE WILL ENCOUNTER MORE OF THIS," said Richard DeKaser, chief economist for National City Corp in Cleveland. Goldman Sachs economist Jan Hatzius said the data implied the U.S. economy was sinking into a deep recession in which the jobless rate could climb to 8.5 percent by the end of 2009.

The jobs report showed the construction industry shed 49,000 jobs last month, the 16th straight monthly loss. It also showed a whopping 90,000 manufacturing jobs were cut in October -- reflecting in part 27,000 striking workers at Boeing Co and marking the 28th consecutive month in which factory employment has fallen. Earlier this year, job losses had been concentrated on the goods-producing side of the economy. But the latest data showed the pain spreading further into the vast services sector. Service industries cut 108,000 jobs last month, on top of 201,000 lost in September.

Three blast furnaces, at Port Talbot and Scunthorpe in Britain, and one in the Netherlands, will shut temporarily. Corus, which is owned by India's Tata Steel, blamed the global economic downturn for the cuts. Chief executive, Philippe Varin, said CORUS HAD TO ADAPT "TO THE CHANGING ENVIRONMENT WITH MAXIMUM SPEED".

The cut is greater than expected. Last month, CORUS SAID IT WOULD CUT PRODUCTION BETWEEN OCTOBER AND DECEMBER BY A MILLION TONNES OF CRUDE STEEL - ABOUT 20% OF ITS OUTPUT. In a statement the firm said it had NOW DECIDED TO EXTEND THESE PRODUCTION CUTS beyond December. Corus said no jobs would be lost as a result of the production cutback. The firm, which employs more than 24,000 workers in the UK, announced 400 job losses in its distribution business, on 6 November.

On Wednesday, the Harvard University scholar Henry Louis Gates Jr. appeared on Oprah Winfrey's celebratory post-election special. After learning the news, Gates says, "we jumped up, we wept, we hooped and hollered." IT IS HARD TO OVERESTIMATE THE HISTORICAL SIGNIFICANCE OF THE ELECTION OF THE FIRST BLACK U.S. PRESIDENT. For many blacks, and certainly for much of the country and world, Obama's victory is an extraordinary step toward THE REDEMPTION OF AMERICA'S ORIGINAL 400-YEAR-OLD SIN.

It is astonishing not least for its quickness, coming just 145 years after President Abraham Lincoln issued the Emancipation Proclamation effectively ending slavery and FORTY YEARS AFTER THE ASSASSINATION OF MARTIN LUTHER KING JR. And it is even more astonishing for its decisiveness — Obama carried Virginia, once the home of the Confederacy, a place whose laws just five decades ago would have made the interracial union of his parents illegal.

"Just a little more than 10 years ago," Atlanta mayor Shirley Franklin told TIME this week, "it was inconceivable to any of us that we would see an African American win a national party's ticket and then compete effectively. It's mind-boggling," she continued, "how much this means about the opportunities available to all people — Asians, Latinos and other people who've historically been locked out of the system."

Demonstrators marched Wednesday night through West Hollywood, Hollywood and Santa Monica. Several stopped at busy intersections and blocked traffic, prompting police intervention. An additional group of about 500 protesters gathered near CNN's Los Angeles bureau, where they were seen banging on the doors and walls. The demonstrations caused the Los Angeles Police Department to declare a tactical alert — one requiring all available officers, including some from other precincts, to respond.

San Francisco Mayor Gavin Newsom expressed frustration with the ban, but said he is hopeful it will be overturned in court. The loss was a political defeat for Newsom, who's been one of the most prominent advocates of same-sex marriage. However, he believed the effect on his gubernatorial aspirations is "trivial" and "irrelevant."

City attorneys of Los Angeles and San Francisco, along with the American Civil Liberties Union, filed requests for the state Supreme Court to overturn the gay marriage ban on Wednesday. Meg Waters, part of the Yes on 8 campaign team, told City News Service, "gay and lesbian couples have exactly the same protections under the law with civil unions. Marriage has been defined as a man and woman since time began," Waters said. "The people of California have voted twice, so I think the best thing to do is for everybody involved to figure out a way to move forward."

Waters said she understands "how gays and lesbians may feel concerned about this. If they stop and look at the situation, they have the exact same legal protections and rights under the law today they had yesterday," Waters said. "YOU CAN'T CHANGE THE DEFINITION OF SOMETHING THAT EXISTED FOREVER BECAUSE YOU DON'T LIKE IT."

Locked away in his Chicago home, Mr Obama received his first national security intelligence briefing yesterday as he wrestled with appointments for his Cabinet. Russian President Dmitry Medvedev was first to lay down a challenge to America's new leader - by increasing tension in a stand off reminiscent of the Cold War. In a provocative speech FROM THE KREMLIN, he threatened to base warheads along the Polish border if Mr Obama goes forward with a Bush administration plan to create a missile shield in Eastern Europe.

THEN ISRAEL WARNED last night that the new U.S. Commander-in-Chief's campaign claim that he was ready to open talks with Iran could be seen in the Middle East as a sign of weakness. After eight years of staunch support from President Bush, the Israelis are now watching Mr Obama closely - even though he does not take power until January - looking for indicators as to how he will handle the nuclear threat from Tehran.

IN AFGHANISTAN, President Hamid Karzai demanded that Mr Obama 'put an end to civilian casualties' by changing U.S. military tactics to avoid airstrikes in the war on the Taliban. He spoke out after seven wedding party guests were accidentally killed by an American airstrike in the southern Kandahar province. Afghan officials said last night 13 gunmen were killed in the attack.

As if the instant foreign policy tests were not enough, Mr Obama was also facing more economic problems with the Dow Jones Index dropping for a second successive day. WALL STREET GREETED HIS ELECTION WIN BY PLUNGING NEARLY 500 POINTS ON WEDNESDAY and it was down again by 274 points in afternoon trading.

Until Mr Obama takes office on Jan 20, the United States must make do with THE LAME DUCK LEADERSHIP OF PRESIDENT GEORGE W BUSH. This creates an obvious window for America's opponents and friends alike to exploit.

RUSSIA AND FRANCE HAVE ALREADY SEIZED THEIR CHANCE. The Kremlin chose the day of Mr Obama's victory speech to deploy nuclear-capable missiles in Russia's Baltic enclave of Kaliningrad, bordering Poland and Lithuania, both members of Nato and the European Union. Moscow also announced a package of constitutional reforms apparently designed to allow Vladimir Putin, now prime minister, to return to the presidency and serve another 12 years at the pinnacle of power. RUSSIA MADE THESE MOVES SECURE IN THE KNOWLEDGE THAT A LEADERLESS AMERICAN ADMINISTRATION WOULD NOT BE ABLE TO REACT.

FRANCE, WHICH PRESENTLY HOLDS THE EU'S PRESIDENCY, ALSO SEIZED THE MOMENT. Paris has quietly proposed to begin formal talks between Russia and the EU on a new partnership agreement, a process which had been frozen after the war in Georgia in August. If this goes ahead – and America is in no position to protest – Russia will escape the only real diplomatic penalty it suffered for invading its neighbour.

Other countries may also exploit Washington's power vacuum. Perhaps the most dangerous – though remote – possibility is that AL-QAEDA may try to disrupt the entire transition from one president to another BY MOUNTING A SPECTACULAR ATTACK IN THE AMERICAN HOMELAND. This presents an obvious opportunity, but whether the terrorist network is still capable of this kind of action is open to doubt.

Obama needs to pump serious cash into the economy in a way that promotes his long-term priorities. That means billions for energy-efficient and climate-friendly infrastructure like wind turbines, solar panels and mass transit, but nothing for new sprawl roads that ravage nature and promote gas-guzzling. That means stronger levees and restored wetlands that will help protect New Orleans from the next storm, but no more traditional pork-barrel water projects that destroy wetlands and waste money. Mostly, it means revamping Washington's dysfunctional method of selecting and funding infrastructure projects.

AMERICA'S INFRASTRUCTURE IS BROKEN, with more than 150,000 structurally deficient bridges, 3,500 unsafe dams and antiquated sewer systems that need an estimated $400 billion worth of improvements. That's a big long-term problem for America's economic competitiveness.

To jump-start the economy, Obama needs to spread hundreds of billions of dollars, and he'd be wise to start with the currently underfunded efforts to restore the Everglades, coastal Louisiana and the Great Lakes; to repair crumbling dams, dikes, sewer pipes and bridges; to promote high-speed rail, light rail and other transit systems besieged by skyrocketing demand; even to accelerate research into renewable energy and alternative fuels.