The most populous state in the US faces a budget deficit of more than $15bn (£7.6bn), and legislators are struggling to agree a spending plan. Mr Schwarzenegger says the cuts will save $100m a month and put pressure on politicians reach a budget deal. But a leading official in the state challenged the decision to cut pay.

Opponents said there was enough cash to pay full salaries and the state's financial controller, John Chiang, vowed to ignore Mr Schwarzenegger's order. California has one of the largest economies in the world but the governor says it currently has no way to pay contractors for many of the services it provides.

Some 30 American states face budget deficits, caused by rising costs and falling revenues in a slumping economy, but California is by far the largest.

EDF had been expected to announce a £12bn deal to buy British Energy. However, it is understood that shareholders argued that the soaring price of energy meant they should be able to command a higher offer. The rejection is a major setback to the UK's plans to cut greenhouse gases by relying more on nuclear energy.

The government holds a 35% stake in British Energy and is believed to have backed the deal, which would have raised as much as £4bn for the chancellor. But Invesco and Prudential, who together own about 22% of the firm, felt that the 765 pence-per-share offer was too low, said the BBC Business Editor, Robert Peston. Although the deal could yet be revived, the latest development was bound to be a disappointment for the government which wants to get the building of new nuclear power stations under way as soon as possible to replace the ageing Magnox reactors, our business editor said.

He added it was an "embarrassment" to the Department of Business, Enterprise and Regulatory Reform (BERR) which has responsibility for energy policy and controls. "The department was planning to hail the deal as facilitating plans to fill the gap between our energy needs and generating capacity that will yawn open in the coming decade."

The deficit of $27.33 a share compares with a profit of $891 million, or $1.56, a year earlier. Excluding costs GM considers one-time, the per-share loss was 4 times bigger than analysts projected. Labor strikes contributed to a $9.9 billion drop in North American revenue, and sales worldwide tumbled 18 percent to $38.2 billion.

The results step up pressure on Chief Executive Officer Rick Wagoner, 55, to show he can revive the largest US automaker. Wagoner, in his ninth year as CEO, has posted $69.8 billion in losses since 2004 and is trying to raise as much as $17 billion in cash while speeding the development of fuel-saving cars to replace the sport-utility vehicles being shunned by US buyers.

GM's fourth straight quarterly loss comes as a weakened US economy and soaring gasoline prices drag US auto sales to 15-year lows. Demand for GM products dropped 16 percent through June, and analysts expect the automaker to report a decline in that range when July sales are released today.

"It is an existential threat," Mofaz said at a forum on Iran at the Washington Institute for Near East Policy. "We have to make sure we are prepared for every option." Mofaz, a former Israeli army chief of staff, is a potential future leader of Israel because of Prime Minister Ehud Olmert's planned departure from office. Mofaz is competing with Foreign Minister Tzipi Livni for control of the ruling Kadima party after Olmert said July 30 that he won't compete in the party's Sept. 17 primary amid a corruption scandal.

While Mofaz accused the Iranian government of "buying time" in its resistance to international pressure to suspend uranium enrichment, he said the diplomatic "track" should continue. "We don't want war, we want peace," Mofaz said. "But we will not let the second Holocaust take place."

The comments from Mofaz, who also serves as transportation minister, echoed statements he made last month to the Jerusalem Post that "all options are on the table. If there won't be a choice other than a nuclear Iran or a military option, it's clear what our decision has to be."

Banks' primary credit borrowings averaged $17.45 billion per day in the latest week, the second straight week this had hit a record and up from $16.38 billion the previous week, Fed data showed on Thursday. "It shows there's a shortage of liquidity in the system," said Christopher Low, chief economist at FTN Financial in New York.

Secondary credit the Fed extended, which is usually taken out by banks in need of emergency cash, rose to $89 million in the latest week, from $34 million the week before. Although these numbers are still very small compared with primary credit, "What that tells you is that there's an increasing number of banks that the Fed is classifying as 'unsound' or inadequately capitalized," Low said.

"The panic of last year is over. It's more orderly now, but the financial stresses remain and there will be more difficulties to come," said John Canavan, market analyst at research company Stone & McCarthy in Princeton, New Jersey.

"I may have been present as the world order crumbled. But at the same time, I have witnessed the emergence of a new world order where all of the world's countries are present and defend their rights," Jonas Gahr Stoere wrote in an opinion piece in the Norwegian paper of reference Aftenposten. "Just a few years ago, the United States and the EU resolved all disputes. When they agreed on a solution, that was often the way it turned out. Those days are numbered," he wrote, pointing to the mounting influence of countries like China, India and Brazil.

The Geneva talks collapsed Tuesday after nine gruelling days of negotiations aimed at reaching a consensus on subsidy levels and import tariffs for a new deal under the WTO's seven-year-old Doha Round. "The failure in Geneva should encourage us to develop a world order that is in line with a new era," Stoere said, insisting that the aborted talks should not be the final word on the matter.

Norway, which is not a member of the European Union, has traditionally imposed high duties on imported agricultural goods to protect its heavily subsidised farmers.

This is the first time that a GE product which has been cleared for use as food for humans and animals has shown signs of toxic effects on internal organs. The study, published today in the journal "Archives of Environmental Contamination and Toxicology", analysed results of safety tests submitted by Monsanto to the European Commission when the company was seeking authorisation to market its GE Maize variety MON863 in the EU.

The data shows that MON863 has significant health risks associated with it; nonetheless, the European Commission granted licences to market the maize for consumption by both humans and animals. The incriminating evidence was obtained by Greenpeace following a court case, and passed on for evaluation by a team of experts headed by Professor Gilles Eric Séralini, a governmental expert in genetic engineering technology from the University of Caen.

Professor Séralini's analysis now scientifically confirms these concerns. As the study states, "with the present data, it cannot be concluded that GM corn MON863 is a safe product." And yet, MON863 has been authorised for markets in Australia, Canada, China, Japan, Mexico, the Phillipines, and USA, besides the EU. What are the chances we have already eaten this corn? I'd say pretty good, even though consumers aren't allowed to know if they are eating it. Don't you just love knowing you may be eating food produced by the same company that made PCBs and Agent Orange?

"Millions of vulnerable North Koreans are at risk of slipping toward precarious hunger levels," Jean-Pierre de Margerie, North Korea director for the organisation, told a news conference. "The last time hunger was so deep and so widespread in parts of the country was in the late 1990s." The famine in the 1990s was one of the world's gravest in recent decades, and yet passed largely unnoticed in the outside world until it was well under way due to the country's historic secrecy.

Hundreds of thousands - some estimates went as high as two million - people died, from a total population of 22 million. The immediate triggers for the current shortages are the floods and consequent poor harvests of last year. Mr de Margerie said there was an urgent need for £10 million of new food supplies, on top of aid already sent by neighbouring countries, to last till this year's harvest.

"We are running against the clock here," he said. The North Korean regime experimented with reforms to the state supply system in recent years, but has since revoked them and reimposed central control of the rice supply. The price of rice is now nearly three times what it was a year ago, Mr de Margerie said.

Money was no object as the flight would have cost the owner - thought to be a Sheikh - around £20,000. The move sparked fury from green campaigners. An airport worker said: "This car doesn't have a carbon footprint - more of a crater."

The overall cost of sending the Lamborghini to London for the oil change would have cost more than £23,000. His black-and-gold supercar costs £3,552 to service at an approved dealer - on top of the £20,000 to freight from Qatar to Britain. A cargo handler at Heathrow blasted the car's environmental damage. He said: "It would have been far more efficient to fly mechanics out there."

Peres said that there must be a separation between the Arabs of Jerusalem and the Jews, and that it must be in the form of a wall. "Jerusalem has become a security problem of late," Peres said. "We have to make both a wall and a bridge in Jerusalem. We have to ensure separation and also let them live differently, otherwise it will be like a pressure cooker that is liable to explode.

Without offering a carrot, there is no value to using a stick; sticks alone cannot educate. In the meanwhile, they are fortifying themselves, and Hamas is taking over the street, instilling fear on the Arab street in Jerusalem. It is not simple to solve this problem, and it can take time to find the right solution."

Fatah has arrested hundreds of Hamas members and leaders and is closing down businesses, schools and institutions associated with Hamas.

Hamas, which ousted Fatah from political power in Gaza after bloody clashes in June 2007, has charged that Palestinian Authority (PA) chairman Mahmoud Abbas and Prime Minister Salam Fayyad are cooperating with Israel by trying to wipe out Hamas's strength. Hamas has arrested more than 200 Fatah members in Gaza, and Fatah has retaliated in Judea and Samaria, causing an overflow in PA jails.

The survey was carried out by financial news channel CNBC Europe, with Mr Blair supported by 37 percent of respondents, Ms Merkel 23 percent and Mr Juncker 12 percent of pollsters, UK daily the Guardian reported. The British Labour leader was mentioned as a possible candidate for the new post already last year, mainly after French President Nicolas Sarkozy signalled he would back him. But the idea also sparked some objections in other European capitals, with Chancellor Merkel herself reportedly arguing against such a choice.

The creation of a new EU president post - to be held for two and a half years and partly replace the current six-month rotating chairmanship of the bloc's member states - is still an open question due to the failed referendum in Ireland on the Lisbon Treaty, which would have introduced institutional changes to how the EU is run, including the new position.

The current French EU presidency had been planning to hold a debate on the tasks of a bloc's new president and also on which personality should fill the position, and that of a new common foreign minister. After the Irish rejected the Lisbon Treaty in June, the main question mark remains on how the EU can move on with the institutional reform that needs to be approved by all member states.

A group of EU nations should form a "pioneering group" to deal with issues of European security and defense, Fischer said at the presentation of a European Council on Foreign Relations study. "We must recognize the reality of a 'multi-speed Europe' on defense," said Fischer, one of the council's co-chairs. "The reluctant should not be bullied, but neither must they hold the others back."

Fischer added that the bloc needed to take a "flexible approach" to cooperation between states on key issues in order to move forward after the Irish rejection of the Lisbon Treaty, which foresees creating a new post to steer European foreign and security policy. The report reprimanded EU nations for a haphazard system of inefficient military spending that is hindering the bloc from making better contributions to global security, according to the study's author, Nick Witney. He added that the EU will only be a worthwhile security partner with the United States if members pool their resources.

"For defense ministries, change and cooperation are deeply counter-cultural," Witney wrote. "It is down to heads of government to demand progress - and to do more to explain to their publics and parliaments how vital this is for the security of every European."

There are also expected to be written assurances on the issues of abortion, taxation and neutrality. The paper notes that in order to accommodate this timeframe, the appointment of the new EU Commission would need to be temporarily delayed until the winter of 2009 - after a second Irish referendum. A senior government source told the paper: "You'd have to arrive at that decision by a logical means by the end of this year. It's shaping that way. It's being kicked around."

Former minister Mary O'Rourke told a Dail committee yesterday "It is a very foolish route we are taking if we think we can have another referendum... The people said 'No'. There is no escaping that. We will not be able to carry another referendum. The sooner we realise that, wake up to it, the better."

A leader in the Irish Independent argues that the plan for a second referendum "deserves calm appraisal", but says that a recent poll from Open Europe showing it would be defeated "should not be dismissed out of hand". Fionnan Sheahan argues in the paper that a second Lisbon referendum is "inevitable, so the only question is when". He believes that an autumn 2009 poll "will allow the heat to be taken out of the situation for a while", but accepts that "a second referendum will be trickier than the first."

The FT notes that there was relatively little trading of blame in the aftermath of the breakdown. However, China and some other developing countries blamed wealthier countries for protecting their agricultural sectors while demanding poor countries cut tariffs on industrial goods and liberalise services markets.

The EU is far from blameless. During the Geneva talks, the EU did not make any new concessions on tariff reductions relative to the 2006 position. Last week, Mandelson attempted to spin that the EU had proposed reducing farm tariffs by 60% - up from the existing offer of 54%, calling it a "a very considerable improvement on our own part."

However, EU Agriculture Commissioner Mariann Fischer-Boel and French Trade Minister Anne-Marie Idrac admitted that the offer was "nothing new" - the difference between the two figures was merely down to whether tropical products were included in the tariff cut calculations or not. Trade negotiations are inevitably based on reciprocity: given the intransigence of the EU on market access, it's hardly surprising that large developing countries were wary of demands that they bring down their own tariffs. The question of safeguard mechanisms was merely the final straw that led to the collapse of talks.

The WSJ notes that by the end of 2009, there will be a new US President, a new EU Trade Commissioner and possibly a new Indian government - ALL WHICH COULD MAKE A NEW GLOBAL TRADE DEAL EVEN HARDER. Open Europe's Hugo Robinson was interviewed on Al-Jazeera English, discussing the breakdown of the talks.