It quoted a confidential study by the hedge fund Bridgewater Associates as saying losses for banks holding risky assets could be four times greater than the 400 billion dollars previously estimated. The hedge fund expressed doubts that the financial institutes would be able to drum up enough funds to cover the losses, something it said could exacerbate the crisis.

Bridgewater, one of the world's biggest hedge funds, based its calculations on the state of risky debt-based US assets, such as mortgages, credit and credit card demands. The value of such risky assets is 26,600 billion dollars, according to the hedge fund. The losses would amount to 1,600 billion dollars if these assets were valued at market rates and not in the form of securitization, the newspaper said

THE AUTHORITY IS CONCERNED IT COULD BE ACCUSED OF DISCRIMINATION AFTER A WARNING FROM ITS OWN LESBIAN, GAY AND BISEXUAL ADVISORY GROUP. It has suspended work on the Circular Road above Avon Gorge, which would open up the area to wildlife and visitors. Talks are now being held to try to end the deadlock.

Head of parks, Peter Wilkinson, said the council had strong equality policies to protect the interests of all groups, irrespective of their sexuality. "The general public are unhappy about people taking part in lewd behaviour in public spaces, whether it's between men and women or people of the same sex", he said. "We are working together with the Terence Higgins Trust to make sure any work we will do is sensitive.

"We're making sure people know what we are doing so we are not seen to be discriminating." Although having sex in a public place could give rise to a criminal charge such as indecent exposure, police have said they are unlikely to investigate unless a formal complaint is made.

The PM said "unnecessary" purchases were contributing to price rises, and urged people to plan meals in advance and store food properly. A government study found the UK wastes 4m tonnes of food every year, adding £420 to a family's shopping bills.

Rising prices and the world economy are due to dominate the annual G8 summit. The Cabinet Office report, due to be published later, claims that up to 40% of food harvested in developing countries can be lost before it is consumed, due to the inadequacies of processing, storage and transport.

Over the last few decades, the Church of England has increasingly presented itself as one part of the global Anglican Communion. This seemed a way of reinventing itself, of edging away from the embarrassment of being a state church. But the move has turned out to be disastrous. It has been the undoing of the C of E and has led what was once a pacific, tolerant church to its present state of exhausted collapse.

On Monday, 1,333 'traditionalist' clergy threatened to defect to Rome in protest against women bishops. The same day, 2,300 clergy in favour of women bishops signed a statement protesting against the protesters. On Friday this week the General Synod will discuss the two separate, but equally intractable breakaway groups - the English traditionalists (whose beef is with women) and the worldwide evangelicals (who complain most of all about homosexuality).

On the eve of the Lambeth Conference (it begins on 16 July) we are witnessing the End Times of the C of E. The bickering factions in the worldwide Anglican Communion have simply pulled our church apart. Every day, in the run-up to Lambeth, there's a new crisis for poor Rowan Williams. The Archbishop of Canterbury Dr Rowan Williams has spoken of the "agonies and complexities" facing the Church as it struggles with the issues of homosexual priests and women bishops. Dr Williams said he believed Jesus would be with the groups within the Church affected by the controversies including traditionalists and gay clergy.

THEY MET SENIOR ADVISERS OF THE POPE IN AN ATTEMPT TO BUILD CLOSER TIES WITH THE ROMAN CATHOLIC CHURCH, The Sunday Telegraph has learnt. Dr Rowan Williams, the Archbishop of Canterbury, was not told of the talks and the disclosure will be a fresh blow to his efforts to prevent a major split in the Church of England.

In highly confidential discussions, a group of conservative bishops expressed their dismay at the liberal direction of the Church of England and their fear for its future. They met members of the Congregation for the Doctrine of the Faith, the most powerful of the Vatican's departments, the successor to the medieval Inquisition, which enforces doctrine and was headed by Pope Benedict XVI before his election.

The Anglican communion has been arguing over homosexuality since the American Church made Gene Robinson the first openly gay bishop and issued rites for same-sex unions. Conservatives are concerned that gay blessing services are being conducted in Britain and last month this newspaper revealed that a "wedding" ceremony was held for two gay priests.

The issue of homosexual priests is likely to feature strongly at this month's Lambeth Conference of worldwide Anglican bishops. Now the Church of England is poised to endorse women bishops - a move that will seriously damage its relations with the Roman Catholic Church and could force hundreds of clergy to defect to Rome

THEY USE WORDS SUCH AS "TERRIFIED," "DISGUSTED" AND "SCARY" TO DESCRIBE WHAT ONE CALLS "THIS MESS" WE AMERICANS FIND OURSELVES IN. Then comes the list of problems constituting the mess: a protracted war, $4-a-gallon gas, soaring food prices, uncertainty about jobs, an erratic stock market, a tougher housing market, and so on and so forth.

One member's son is serving his second tour in Iraq. Another speaks of a daughter who's lost her job in the mortgage industry and a son in construction whose salary was slashed. Still another mentions a friend who can barely afford gas. Joanne Kontak, 60, an elementary school lunch aide inducted just this day as an Optimist, sums things up like this: "THERE'S JUST ENTIRELY TOO MUCH WRONG RIGHT NOW." Happy birthday, America? This year, we're not so sure.

THE NATION'S PSYCHE IS BATTERED AND BRUISED, THE SENSE OF PESSIMISM PALPABLE. Young or old, Republican or Democrat, economically stable or struggling, Americans are questioning where they are and where they are going. And they wonder who or what might ride to their rescue. These are more than mere gripes, but rather an expression of fears - concerns reflected not only in the many recent polls that show consumer confidence plummeting, personal happiness waning and more folks worrying that the country is headed in the wrong direction, but also in conversations happening all across the land.

Sherry White in Orlando, Florida, said, "THERE IS A SENSE OF HELPLESSNESS EVERYWHERE YOU LOOK. It's like you're stuck in one spot, and you can't do anything about it."

An estimated 145,000 mortgage holders already owe more in mortgage payments than their houses are worth, according to research undertaken for the Daily Telegraph. The research company CACI analysed the 1.2 million people who bought a home since the start of last year and calculated that one in eight are in negative equity. This figure could rise to as many as 360,000 by the end of this year if house prices fall by 20 per cent, as some economists fear is now possible.

As houses prices start to fall, the first to be hit by negative equity are those buyers that borrowed the maximum amount possible to get on the housing ladder, especially those that took out 100 per cent mortgages - worth the full value of the property. For many home buyers these loans were the only way they could afford to get onto the housing ladder, and some lenders - led by Northern Rock - offered loans far in excess of the value of the property.

During the early months of 2007 Northern Rock offered a very popular 120 per cent mortgage, which allowed people to not only buy the home but also pay for the fees, stamp duty and have money to redecorate the property without handing over a penny. Though these deals were offered in far smaller numbers than in the late 1980s, 30,000 home owners have taken out 100 per cent mortgages since the start of last year, according to the Council of Mortgage Lenders.

A further 115,000 people took out mortgage deals of about 92 or 93 per cent, CACI estimates. This means that all of these people are now in negative equity, because house prices have fallen by more than 7 per cent since their peak last year, according to figures released by Nationwide building society this week.

The outlook has darkened dramatically since last year's summit in Germany, WHEN THE LEADERS DECLARED THE GLOBAL ECONOMY WAS IN "GOOD CONDITION" AND OIL COST $70 A BARREL - which seemed high at the time. Since then, the U.S. subprime mortgage crisis has erupted, roiling markets and battering financial firms. Oil has doubled to above $140 and food prices have jumped, hurting the poor in particular and raising the threat of political instability.

"Things have changed for the worse across the board," said Robert Hormats, vice chairman at Goldman Sachs (International) Corp. in New York. "NOW YOU HAVE A FINANCIAL DISORDER WHERE THE EPICENTER IS THE U.S.," he said. And fuel and food inflation "are serious matters that affect large numbers of people."

The group's membership also has grown from six to eight, adding Canada in 1976 and more recently Russia in 1997. But many argue that it should be expanded to include China, the world's fourth-largest economy, and other emerging powerhouses like India and Brazil - especially to tackle global issues like energy and climate change. Already, the G-8 has been reaching out. It plans meetings with African leaders on the summit's first day, and later with leaders from China, India, Mexico, Brazil and South Africa - countries that someday might be a part of the Group of 13.

At 11, Sasha Bennington is too young to remember the days when Jordan was just a country and being branded 'fake' was something to be ashamed of. But maybe the youngster's biggest tragedy is that her mother, Jayne, 31, is in no hurry to paint a picture of how it used to be.

Jayne is talking breezily about how Sasha had her first set of false nails glued on at eight, and now enjoys the sort of rigorous beauty regime - hair extensions, fake tans, pedicures - THAT WAS ONCE THE PRESERVE OF PORN STARS AND DOLLY PARTON, not school children from Burnley in Lancashire. Still, times have changed. "All the kids are at it now," insists Jayne. "WE SPEND ABOUT £300 A MONTH ON BEAUTY TREATMENTS FOR HER. Sasha's friends are the same. All girls their age are. Of course they are! Why else would you be able to buy make-up for pre-teens at Boots?"

"Perhaps it's different in country areas, where they don't need to grow up so fast. But, around big cities, girls have got to be more forward and act older than they are. That's just the way it is. I don't understand why people get so upset about it. None of it is permanent. Tans wash off. Hair extensions come out. Why all the fuss?" Ask Sasha how she sees herself and she replies: "BLONDE, PRETTY, DUMB - I DON'T NEED BRAINS." Her mum laughs her head off at this, proud that the child is so like her.

About 10,000 people are scooping algae out of the sea at the eastern city of Qingdao, while officials in Inner Mongolia are preparing to fight off a plague of locusts that may arrive in the capital city during the Olympics. "There's an old saying in China that good things only come after enduring a lot of hardship," Jiang Xiaoyu, vice president of the Beijing organizing committee, said yesterday in Beijing. "We expected to face many challenges so it's not a surprise. These issues aren't major problems."

So far this year, the world's most populous nation has faced the worst winter snowstorms in 50 years, riots in Lhasa, violent protests about government policies toward Tibet along the Olympic torch relay route in Europe and North America, an earthquake and flooding. China is still recovering from the Sichuan earthquake that killed more than 69,000 people in May, tempering the run-up to an Olympics billed as the country's coming-out party.

Put "9/11 conspiracy" into Google and you get 7.9 million hits. Put in "9/11 truth" and you get more than 22 million. Opinion polls in the US have picked up widespread doubts among the American people. A New York Times/CBS News poll in 2006 found that 53% of those questioned thought the Bush administration was hiding something. Another US poll found a third of those questioned thought government officials either assisted in the 9/11 attacks or allowed them to happen.

Nearly seven years after the terrible events of that September day, the US authorities are due to publish the final report on a third tower that also collapsed on 9/11. UNLIKE THE TWIN TOWERS, THIS 47-STOREY, 610-FOOT SKYSCRAPER WAS NOT HIT BY A PLANE. Tower 7 housed some unusual tenants: the CIA, the Secret Service, the Pentagon and the very agency meant to deal with disasters or terrorist attacks in New York - the Office of Emergency Management. And some people think Tower 7 was the place where a 9/11 conspiracy was hatched.

This summer we will find out whether NIST's report has answered the many questions that have been raised, or whether it will suffer the same fate as the Warren Commission on the assassination of President John F Kennedy and merely add fuel to the conspiracy theories.

Indeed, the comparisons to the Roman Empire are rarely favorable. For example, Cullen Murphy, author of Are We Rome? (2007), argues that the most alarming parallels are the blinding, insular culture of our capitals; the debilitating effect of corruption; the paradoxical issue of borders; and the weakening of the body politic through various forms of 'privatization.'

Murphy sees the eventual decline of the American Empire as inevitable, describing three possible scenarios for the future: there is the 'Fortress America' scenario, where everything revolves around national security and the power of the president expands to near dictatorial strength; the city-state scenario, where the central authority weakens and city-states emerge; and finally the boardroom scenario, where corporations privatize all crucial functions of the government and essentially rule what is commonly called fascism.

David Walker, former comptroller (accountant ) of the United States, has also drawn daunting comparisons between America and Rome. Walker believes that the American economy is standing on a burning platform of unsustainable policies and practices with fiscal deficits, chronic healthcare underfunding, immigration and overseas military commitments. TODAY, AMERICA IS IN A $53 TRILLION HOLE, WHICH TRANSLATES TO $455,000 PER HOUSEHOLD.

UNDENIABLY, SPENDING IS OUT OF CONTROL. This irresponsible spending has resulted in the devaluing of the dollar and untold damage to the economy. As acclaimed historian Chalmers Johnson points out, America's misguided economic policy, with its emphasis on frequent wars and military spending, has led to the decline of vital domestic areas, including the education system, manufacturing capabilities and health care. At the same time, the Department of Defense's planned spending for 2008 is larger than all other nations' military budgets combined and will exceed $1 trillion for the first time.

WITH MORE THAN 500,000 MILITARY SERVICE PEOPLE STATIONED ABROAD IN MORE THAN 130 COUNTRIES, America has become what Johnson describes as a foreign imperialist. This poses its own dangers, such as massive standing armies, an almost constant state of war, an increasing dependence on the 'military-industrial' complex, the dramatic economic drain of military spending and an excessive military budget.

If left unchecked, these will lead to the eventual decline of democracy. And as resources are drained, the republican nature of American government will break down, and the principles inherent in a democratic society will necessarily be compromised by what is needed to sustain such a militaristic empire. The breakdown is already underway.

ONE OF THE WORST CONTRIBUTORS TO TODAY'S PROBLEMS IS WHAT WALKER CALLS A LEADERSHIP DEFICIT WHERE TODAY'S LEADERS ARE SHIRKING THEIR RESPONSIBILITIES. They are concentrating on providing political quick fixes for the present, while giving little thought to how to create a better tomorrow. And with such irresponsible spending, America is mortgaging the future of our country, our kids and our grandkids' and leaving a legacy of a future of lower standards of living and with some major, major financial burdens.

Moreover, we face "a growing intellectual bankruptcy that is one of the symptoms of a dying culture," writes author Chris Hedges. "In ancient Rome, as the republic disintegrated and the Caesars were deified, as the Roman Senate became little more than an echo chamber of the emperor, the population's attention was diverted by a series of frontier wars and violent and elaborate spectacles in the arena. THE EXCITEMENT OF ENTERTAINMENT CONSUMED ANCIENT ROME'S EMOTIONAL AND INTELLECTUAL LIFE. It poisoned civic and political discourse. Social critics no longer had a forum in which to speak. They were answered with ridicule and rage. IT WAS NOT THE PREROGATIVE OF THE CITIZEN TO THINK."

'We the people' have not held our government accountable and have been content to lose ourselves in television, the Internet, cell phones and the technological gadgets that distract us from reality. We have, in the words of author Nicholas von Hoffman, become 'bobbleheads in bubbleland.'
CLEARLY, AMERICA IS AT A CROSSROADS. Thus, we have a decision to make: DO WE WANT A DEMOCRACY OR DO WE WANT AN EMPIRE, BECAUSE AS HISTORY HAS SHOWN, IT'S NOT POSSIBLE TO HAVE BOTH.

A confidential World Bank document indicates the true extent of the effect of biofuels on world food prices. Rising food prices have been blamed for pushing 100 million people beneath the poverty line. The confidential report, based on a detailed economic analysis of the effect of biofuels, will put pressure on the American and European governments, which have turned to biofuels in attempts to reduce the greenhouse gases associated with fossil fuels and to reduce their reliance on oil imports.

The report says: "Without the increase in biofuels, global wheat and maize stocks would not have declined appreciably and price increases due to other factors would have been moderate." Next week leaders of the G8 industrialised countries meet in Japan to discuss what action needs to be taken to alleviate the food crisis. They will be lobbied by campaigners calling for a moratorium on the use of biofuels.

"Political leaders seem intent on suppressing and ignoring the strong evidence that biofuels are a major factor in recent food price rises," said Robert Bailey, a policy adviser at Oxfam. "It is imperative that we have the full picture. WHILE POLITICIANS CONCENTRATE ON KEEPING INDUSTRY LOBBIES HAPPY, PEOPLE IN POOR COUNTRIES CANNOT AFFORD ENOUGH TO EAT."

Alain Lamassoure, French MEP and close advisor to Nicolas Sarkozy, has told the Irish Times that Ireland was wrong to hold a referendum, which is "a tool for dictators." He said: "If you hold 10 or 12 referendums and in every state there is 80 per cent support for an idea there is still only a less than 1 per cent probability that the measure will pass everywhere."

He warned that Ireland could spark a major crisis capable of splitting the EU if it cannot ratify the Lisbon Treaty by next spring. He said it was up to the Government to determine how it could pass the Treaty through either a new referendum or a majority in the Dáil.

Irish MEP Gay Mitchell added; "The last thing we need now is (French) President (Nicolas) Sarkozy riding into town with instructions and advice. What we need now is reflection by the Irish people themselves."

He said: "I expect heavy pressure to create an EU a la Francaise. Our position is different out of necessity and we must make an effort for the EU not to develop in a manner the French and the rejected Lisbon (treaty) are attempting to impose." Meanwhile Polish President Lech Kaczynski said in response to efforts by Sarkozy to urge him to ratify the Treaty, "Pressure sometimes has the opposite effect from what's expected."

According to Agence Europe Austrian Chancellor Alfred Gusenbauer has defended his intention to put any future amendments to the Lisbon Treaty to a referendum, saying, "We have only 28% support in Austria in favour of the EU. One third of the population is fiercely opposed to the Union. Between the two, there are the sceptics. If we do not deal with the sceptics, there will soon be 50% or more tough opponents to the EU". In Süddeutsche Zeitung yesterday he said imposing referendums is "one of the few ways to make any political class explain itself to the population".