IN SEARCH OF NEW INVESTMENTS, ANDERSON SENDS DOZENS OF HIS EMPLOYEES TO VISIT AGRICULTURAL REGIONS AROUND THE WORLD. Back in New York, at his company's headquarters on the 27th floor of an office building high above Park Avenue, they bet on agricultural markets from Peru to Vietnam. But in the towers above Manhattan's urban canyons, it's easy to lose touch with the ground. Hedge fund manager John Paulson was recently celebrated for achieving a record annual profit of $3.7 billion (€2.3 billion). THOSE WHO WORK IN THIS ENVIRONMENT HAVE ONLY ONE RULE: DON'T DISAPPOINT PROFIT-HUNGRY INVESTORS.

"I'm constantly wired," Anderson used to say, back when he talked to journalists. His nickname in the industry is the "Commodities King," and his Ospraie hedge fund is the world's largest. These days, though, Anderson avoids the media. He's even kept his face out of the media by buying up rights to all photos of himself on the market. His spokesman is now paid, mainly, to say nothing.

BIOFUELS and global warming have been blamed for shortages driving up the price of food, and both trends have played their role. The planet's grain reserves are almost empty for a number of reasons, including GLOBAL POPULATION GROWTH and GREATER PROSPERITY IN SOME COUNTRIES like India. Feed corn is in short supply because industrialized nations have used it for ethanol. DROUGHTS - in Australia, for example - have devastated rice and wheat harvests. Wheat reserves worldwide are only sufficient right now to cover about 60 days of demand. This helps to explain why commodity prices have rallied since early 2006, with the price of rice ballooning 217 percent, wheat 136 percent, corn 125 percent and soybeans 107 percent.

BUT CLASSIC SUPPLY AND DEMAND THEORY OFFERS ONLY A PARTIAL EXPLANATION. Sudden price hikes since last January have been alarming. The UN estimates that at least $500 million (€312 million) in immediate aid will be needed by May 1 to avoid serious famines. Agricultural scientists at the world body's Educational, Scientific and Cultural Organization (UNESCO) have presented a report on the world food crisis. AND CRITICISM IS GROWING THAT HEDGE FUNDS, INDEX FUNDS, PENSION FUNDS AND INVESTMENT BANKS BEAR PART OF THE BLAME.

ON THURSDAY THERE WERE SOME ISOLATED INCIDENTS IN BERLIN BUT IT WAS HAMBURG THAT SAW THE WORST RIOTING. Major May 1 riots rocked the northern German port city of Hamburg and isolated attacks occurred on Thursday in Berlin, where the head of the city's police department was forced to flee an angry crowd of left-wing demonstrators. In Hamburg, an estimated 1,100 right-wing extremists and 7,000 left-wing radicals clashed, escalating to an unusual level of violence for the city. "THESE WERE THE BIGGEST RIOTS THE CITY HAS SEEN IN A LONG TIME," Ralf Meyer, a spokesman for the Hamburg police, told SPIEGEL ONLINE.

In the city, rioters burned trash cans, cars, lit firecrackers, set off smoke bombs and volleyed a hail of stones. In one incident, a pile of tires was burned just 20 meters (65.6 feet) away from a gas station. AROUND 2,500 POLICE WERE DEPLOYED IN THE CITY, AND OFFICERS ATTEMPTED TO DISPERSE THE CROWDS BY FIRING WATER CANNONS. Neo-Nazi groups in Germany often hold rallies during the May 1 holiday that frequently end in massive clashes between neo-Nazis and anti-fascist, left-wing groups. The day is traditionally one for workers' unity rallies across Europe, but in Germany it often boils down to confrontations between extreme-right and far-left protesters.

Meanwhile, police confirmed on Friday that a neo-Nazi group took control of two cars of a commuter train near Hamburg on Thursday as they traveled towards the march in the city, sending out xenophobic messages over its loudspeaker. According to passengers, the neo-Nazi's took control of the loudspeaker and made anti-foreigner statements like: "STARTING TODAY, THE GERMAN NATIONAL RAILWAY WILL TRANSPORT FOREIGNERS AND GERMANS IN SEPARATE CARS." FOR FOREIGNERS, THE NEO-NAZI'S APPARENTLY SAID, "FREIGHT CARS ARE AVAILABLE."

THE MUDDY MISSISSIPPI IS AT LEVELS NOT SEEN IN MORE THAN THREE DECADES, putting hundreds of thousands of acres of farmland under water. It's impossible to gauge overall agricultural losses at this point, federal and state officials say, but most agree the cost will be expensive and the damage extensive. The U.S. Army Corps of Engineers says a total of 855,750 acres are under either Mississippi floodwater or backwater from the Yazoo River, which drains much of the board-flat Mississippi Delta into the Mississippi River. About 273,000 of those flooded acres are cleared for wheat, cotton, soybeans, corn and other crops.

THE FLOOD HIT JUST AS FARMERS WERE PREPARING TO HARVEST WHEAT and plant corn, soybeans and cotton. Some, like farmer Brad Bradway, were forced to watch as water crept inch by inch over his 110 acres of wheat until his fields sat under 8 feet of water. Others are now stuck waiting for the water to recede and the ground to dry before they can plant, guaranteeing a shortened growing season, yield reductions and lower returns. THIS COMES AFTER A DROUGHT HAS LEFT MUCH OF THE REGION PARCHED FOR SEVERAL YEARS.

"AT ONE POINT I HAD 300 ACRES UNDER WATER AND 240 ACRES TOO DRY TO PLANT," BRADWAY SAID. "WHAT'S WRONG WITH THIS PICTURE?"

IRAN HAS DRAMATICALLY REDUCED DEPENDENCE ON THE DOLLAR over the past year in the face of increasing U.S. pressure on its financial system and the fall in the value of the American currency. Oil is priced in dollars on the world market, and the currency's depreciation has concerned producers because it has contributed to rising crude prices and eroded the value of their dollar reserves.

"THE DOLLAR HAS TOTALLY BEEN REMOVED FROM IRAN'S OIL TRANSACTIONS," Oil Ministry official Hojjatollah Ghanimifard told state-run television Wednesday. "We have agreed with all of our crude oil customers to do our transactions in non-dollar currencies." Iranian President Mahmoud Ahmadinejad called the depreciating dollar a "WORTHLESS PIECE OF PAPER" at a rare summit last year in Saudi Arabia attended by state leaders from OPEC countries. Iran's central bank has also been reducing its foreign reserves denominated in dollars, motivated by the falling value of the greenback and U.S. attempts to make it difficult for Iran to conduct dollar transactions.

However, several presidents who were invited - most notably US President George W. Bush - have confirmed their attendance. Like Bush, some of the other dozen presidents on the list have been to Israel before, but this will be a first visit for Mongolian President Nambaryn Enkhbayar, among others. The agenda for the conference covers a myriad of topics, including the future of the world economy; the content and meaning of a Jewish state; THE EXTENT TO WHICH JEWISH TRADITION IS RELEVANT IN TOMORROW'S WORLD; whether a green Israel is possible; the tipping point of the geopolitical arena; Israel's ability to continue to be a leading contender in the world of science; and cultivating future leaders of Israel and the Jewish people.

Expected presidential attendees include: Victor Yushchenko of Ukraine; Lech Kaczynski of Poland; Paul Kagame of Rwanda; Michael Saakashvili of Georgia; Stjepan Mesic of Croatia; Bamir Topi of Albania; Blaise Campoare of Burkina Faso; Danilo Türk of Slovenia, Tommy Remengesau Jr. of Palau; and Valdis Zatlers of Latvia. The prime ministers of the Slovak Republic and of Hungary, Robert Fico and Ferenc Gyurcsany, will also take part, AS WILL SEVERAL FORMER WORLD LEADERS, AMONG THEM MIKHAIL GORBACHEV, TONY BLAIR AND HENRY KISSINGER.

Presented as the "world's longest sea bridge", the 36-kilometre (22-mile) structure connects Jiaxing city near Shanghai to the port city of Ningbo in the eastern province of Zhejiang. The 11.8 billion yuan (1.7 billion dollars) bridge cuts the length of the road trip from Shanghai to Ningbo by 120 kilometres, the official Xinhua news agency said. Construction of the six-lane bridge started in November 2003 in an effort to reduce traffic congestion in the booming area, Xinhua said.

Adorned in the colours of imperial China, with a roof that evokes the scales of a dragon, the massive glass-and-steel-sheathed structure, designed by the British architect Norman Foster, cost $3.8 billion and can handle more than 50 million passengers a year. The developers call it the "MOST ADVANCED AIRPORT BUILDING IN THE WORLD," and say it was completed in less than four years, a timetable some believed impossible. It opened in late February with little fanfare, but also without the kind of glitches that plagued Heathrow's new $8.7 billion terminal near London, which took six years to complete.

THIS IS THE IMAGE CHINA WOULD LIKE TO PROJECT AS IT PLAYS HOST TO THE OLYMPIC GAMES this summer - a confident rising power constructing dazzling new monuments that exemplify its rapid progress and its audacious ambition. While much of the world has focused on protests trailing the Olympic torch relay, Beijing's poor human rights record, its pollution, product safety and child labor scandals and a host of other problems, workers here have been putting the finishing touches on ONE OF THE BIGGEST BUILDING PROGRAMS THE WORLD HAS EVER SEEN.

Satellite imagery, passed to The Daily Telegraph, shows that a substantial harbour has been built which could house a score of nuclear ballistic missile submarines and a host of aircraft carriers. In what will be A SIGNIFICANT CHALLENGE TO US NAVY DOMINANCE AND TO COUNTRIES RINGING THE SOUTH CHINA SEA, one photograph shows China's latest 094 nuclear submarine at the base just a few hundred miles from its neighbours. The location of the base off Hainan will also give the submarines access to very deep water exceeding 5,000 metres within a few miles, making them even harder to detect.

Other images show numerous warships moored to long jettys and a network of underground tunnels at the Sanya base on the southern tip of Hainan island. The development so close to the sea lanes vital to Asian economies "can only cause concern far beyond these straits". Military analysts believe that China's substantial build up of its forces is gaining pace BUT HAS REMAINED HIDDEN FROM THE WORLD in the build-up to the Olympics. China has diverted much of its resources from the huge Peoples Liberation Army to the navy, air force and missile development.

Christian Le Miere, editor for Jane's Intelligence Review, said the complex underlined Beijing's plan - to assert tighter control over this region. "THIS IS A CHALLENGE TO ANY HEGEMONIC POWER, PARTICULARLY THE US WHICH STILL REMAINS DOMINANT IN THE REGION." So far China has offered no public explanation for its building at Sanya.

The credit crunch has frozen money markets and rattled consumers around the world, pushing the global economy to the edge of a sharp slowdown after banks lost confidence in each other due to defaults on low-end mortgages in the United States.

If the fallout from the crisis turns out to be not as drastic as many fear, the implications for global interest rate - and fiscal - policy will be significant. Current market estimates of sub-prime mortgages amount to nearly $400 billion (200 billion pounds) and the IMF has said the wider cost to the financial sector could rise to $1 trillion.

"ALL OF THEM ARE POTENTIALLY SIGNIFICANT OVERESTIMATES OF THE LOSSES WITHIN THE WIDER ECONOMY ASSOCIATED WITH THE FINANCIAL MARKET CRISIS," the Bank of England said in its twice-yearly Financial Stability Report, estimating actual losses could be closer to $170 billion. Governor Mervyn King told lawmakers on Tuesday that a period of slower growth would not be a "disaster", SAYING IT WASN'T ALL DOOM AND GLOOM JUST YET.

Germany can now put up 5 billion euros ($7.8 billion) to help the bank ride out its exposure to the subprime banking crisis. The government bailout, however, required approval from EU regulators. "The Commission's investigation found that the risk shield constitutes state aid, but that the aid is in line with EU rules," since the aid is limited to six months and is reversible, meaning it can be paid back if it distorts competition, the EU said in a statement.

Other European governments have jumped in to rescue troubled banks. The European Commission is investigating Britain's nationalization of Northern Rock PLC, the mortgage bank that nearly collapsed in a bank run last year.

Numerous European banks have been battered by the U.S. mortgage crisis. Switzerland's UBS AG saw losses and write-downs of approximately $19 billion. Deutsche Bank AG said Tuesday that it wrote down $4.2 billion. German regional bank BayernLB reported write-downs of $6.7 billion.

The number one spot in the rankings, compiled by the Boston Consulting Group, was occupied by the INDUSTRIAL AND COMMERCIAL BANK OF CHINA, with market capitalisation of nearly 340 billion dollars (218 billion euros). In second place was CHINA CONSTRUCTION BANK, followed by HSBC of Britain, BANK OF CHINA, Bank of America and Citigroup of the United States.

The study found that banks in NORTH AMERICA AND WESTERN EUROPE HAD SUFFERED A LOSS OF 695 BILLION dollars in market capitalisation at the end of 2007 while their counterparts in emerging market countries BRAZIL, RUSSIA, CHINA AND INDIA HAD SEEN THEIR MARKET CAPITALISATION INCREASE BY 753 BILLION DOLLARS.

Major US and European banks have suffered losses and asset writedowns stemming from the near collapse of US subprime - high risk - mortgage sector, which undermined the value of billions of dollars' worth of their mortgage-backed securities.

As one diplomat said, "THIS COULD NOT HAVE HAPPENED WITHOUT THE BEIJING GOVERNMENT APPROVING IT." Given the fact that relations between the Vatican and Beijing have been scratchy to say the least, one can only wonder if this is the start of a mating game. It could lead to diplomatic relations and China's recognition of the pope as leader of all Catholics in the world, including Chinese Catholics, many of whom have been forced to join the state-backed Chinese Catholic Patriotic Association.

Something seemed afoot in the last few months. In November, Monsignor Pietro Parolin, undersecretary for relations with states, was reported to have made a secret visit to China. The Vatican never denied the reports. In March, a Chinese delegation secretly had talks in the Vatican, sources confirmed.

ONE PRECEDENT FOR BATON DIPLOMACY that comes to mind is a similar event that happened in the Vatican on February 20, 1988 when the now mostly-forgotten Cold War still existed. The then-Soviet Union's Red Army Choir performed for Pope John Paul, singing, of all things, Ave Maria. It, too, was a shocker when it was announced. But on Dec 1, 1989, Soviet leader Mikhail Gorbachev made his historic visit to the Vatican, TURNING RELATIONS BETWEEN THE KREMLIN AND THE VATICAN ON THEIR HEAD AFTER SOME 70 YEARS OF MUTUAL DISTRUST. Relations between Russia and the Vatican were established in 1990 and the rest, as they say, is history.

Blair, a life-long Anglican, converted to Catholicism in December after he left office in June. The Italian weekly magazine Panorama is reporting in its latest edition that Bush, a Methodist, may follow his political soul-mate and also convert to Catholicism after he leaves office next year.

Panorama tries to build up its case by reminding the reader that Bush prayed together with Pope Benedict when the pontiff visited the White House on April 16, that Bush's brother Jeb, the former governor of Florida, converted to Catholicism, the religion of his wife, and that a number of Bush's advisers are Catholic. It was reported in zenit.org on April 15th, that - "U.S. President George Bush said that when he looks into Benedict XVI's EYES, he sees GOD."

The Washington Post ran a story on April 13 by Daniel Burke of Religion News Service. Citing the high number of Catholics in his administration, Burke wrote that "George W. Bush could well be the nation's first Catholic president." At the very end of his piece, he has two quotes to the effect that Bush is a "closet Catholic" and the parallel to Blair, but no outright speculation about conversion.

That shouldn't be any surprise. The statement showed his trademark topic - THE COMPATIBILITY OF FAITH AND REASON - was prominent at the three-day session. He has been stressing this for years, with some success (as during his recent U.S. visit) and some misunderstanding (as in his Regensburg speech). With another Catholic-Muslim meeting due later this year, with delegates of the Common Word group, we can expect this issue to stay front and centre in inter-faith dialogue.

That the Iranian delegation agreed with the statements on faith and reason shows they did not see the contradiction between them in Islam that some observers read into Benedict's comments in Regensburg. They also agreed that "FAITH AND REASON ARE INTRINSICALLY NON-VIOLENT," a message Benedict said he meant to get across there.

An experienced boiler room dealer has warned that the UK has wildly underestimated the danger from foreign-based scamsters touting dud shares. The dealer, who has asked to remain anonymous, has been working in Spanish boiler rooms for several years. He told BBC2's Working Lunch that, "it's a billion pound industry, every year." Boiler rooms are staffed by teams of salesmen who cold call unsuspecting investors to offload worthless investments. They use a mixture of telephone bullying and sophisticated sales tactics gleaned from legitimate business.

The latest are "cloned" shares, phoney shares in well known companies such as Google and Microsoft. "Stopping it is nigh on impossible," the dealer tells Working Lunch. "The people who do this, we're materialistic. There's too much money. People aren't going to just stop doing it," he adds.

Steve Wilmot calculates that UK losses to boiler rooms exceed the size of all fraud on plastic cards and are well over half a billion pounds. "It's the biggest single financial threat to middle England."