Wall Street suffered its second big drop in a week Wednesday, with investors worried about spreading fallout from the credit crisis at banks and about a DOLLAR THAT JUST KEEPS GETTING WEAKER. The Dow Jones industrial average fell more than 360 points -- just about matching its pullback of last Thursday.

Comments from Federal Reserve officials didn't give investors much reason to reconsider their bets. St. Louis Fed President William Poole said recent weeks have seen the credit markets make clear progress in returning to normal but SAID THE FED MIGHT HAVE TO MAKE OTHER RATE CUTS. SUCH A MOVE WOULD LIKELY HASTEN THE DOLLAR'S FALL AS INVESTORS WOULD SEEK BETTER INTEREST RATES ELSEWHERE. The central bank reduced the federal funds rate in September and again last month.

Meanwhile, the dollar swooned amid speculation that China will seek to diversify some of its foreign currency stockpiles beyond the greenback and General Motors Corp. further dampened sentiment by posting a record loss tied to an accounting adjustment. Oil hit a record, rising above $98 per barrel before retreating, and gold pushed higher, moves exacerbated by an anemic dollar.

Still, the concern on the Street is THAT THE EXTENT OF THE FALLOUT FROM THE CREDIT MARKET CRISIS THAT HAS LED TO BILLIONS OF DOLLARS IN LOSSES FOR MAJOR BANKS AND INVESTMENT FIRMS IS NOT YET KNOWN. With Citigroup Inc. announcing Sunday it needed to take an additional $8 billion to $11 billion in writedowns, INVESTORS ARE VERY UNEASY NOT JUST ABOUT STOCKS, BUT THE ECONOMY AS A WHOLE.

"The financials are the bodyguards of the market and when the bodyguards are taking shots then the market can't do well," said David Darst, chief investment strategist for Morgan Stanley's global wealth management group.

"A LOT OF THE BAD STUFF IS KNOWN; WHAT THE MARKETS ARE WORRYING ABOUT IS THE UNKNOWN," Darst said.

The dollar cannot remain 'someone else's problem,' Sarkozy said today on Capitol Hill. "If we are not careful, monetary disarray could morph into economic war. We would all be its victims."

Sarkozy's complaints that the U.S. currency's drop against the euro is undermining European competitiveness struck a discordant note in a summit intended to demonstrate an improving U.S.-French relationship. His comments came as the euro surged to a record high against the dollar. The currency touched $1.4731 today, a 65 percent gain since the end of 2001.

Concern that the euro is too strong has been a Sarkozy theme since his presidential campaign earlier this year. Since his May 6 election, he has urged European Central Bank officials to lower interest rates to weaken the currency. Germany hasn't joined Sarkozy in his effort to weaken the currency. German Chancellor Angela Merkel isn't concerned by the euro's appreciation, a Finance Ministry spokesman said.

Beyond economic policy, Sarkozy emphasized France's "friendship" with the U.S., drawing a standing ovation when he expressed gratitude for the liberation of Europe from the Nazis. He backed U.S. opposition to Iran's nuclear program and pledged to keep troops in Afghanistan as long as necessary.

The current tightness will last longer than previous periods of food supply shortages such as the 1974 oil crisis, said Ali Arslan Gurkan, chief of commodity markets and policy analysis at the Rome-based U.N. Food and Agriculture Organization (FAO). "Previous crises petered away quickly," Gurkan told a news briefing to coincide with a report on the outlook for food supplies that highlighted tight stocks of staples such as wheat.

"Biofuels demand and crude oil prices are unique here (now)," he added, referring to the practice of growing crops to manufacture alternative energy in response to record crude oil prices now edging close to a landmark $100 per barrel. In the report, the FAO said the global wheat market is extremely tight and ending stocks are forecast to drop 10.4 percent year-on-year to 142.6 million tonnes in 2007/08.

Gurkan said sub-Saharan African countries, many of which depend on high-cost energy as well as food imports, will be hardest hit by food shortages and inflation. The international community's goal to halve extreme poverty by 2015 was now further out of reach, he added.

Oil in New York rose to a new high above $98 a barrel and the dollar extended its slide to $1.4666 per euro, the lowest ever. Gold is seen by some investors as a hedge against inflation, and a weaker U.S. currency makes the dollar-priced metal cheaper for holders of other currencies. "We may see gold prices breaching the $850 level, at the earliest tonight," said Kazuhiko Saito, strategist at Interes Capital Management Co. in Tokyo. "It's like people are pushing gold prices toward the record."

Bullion for immediate delivery rose as much as $11.99, or 1.5 percent, to $836.99 an ounce, the highest since January 1980, when it reached a record $850 an ounce. The metal was at $834.90 an ounce at 3:51 p.m. Singapore time. Gold has gained more than threefold since the end of 2000 when it fetched $272.25 an ounce.

Silver for immediate delivery jumped as much as 31 cents, or 2 percent, to $15.91 an ounce, the highest since Dec. 1980. The metal stood at $15.75 at 3:47 p.m. Singapore time. It has climbed 22 percent this year, heading for a sixth straight annual gain.

The whopping loss announced Wednesday was attributed to a $38.6 billion noncash charge largely related to establishing a valuation allowance against deferred tax assets in the U.S., Canada and Germany, as well as mortgage losses at GM's former financial arm, GMAC Financial Services.

A joint communiqué signed by visiting Premier Wen Jiabao and his Russian counterpart Viktor Zubkov said increased cooperation on nuclear energy is a priority in economic ties. According to the deals, the two countries will continue to work on the second phase of the Tianwan Nuclear Power Plant in Jiangsu and uranium enrichment factories, and take measures for peaceful use of nuclear energy.

During the 12th regular meeting between the two prime ministers, they agreed to complete the construction of a Sino-Russian oil pipeline by the end of next year and speed up negotiations on a long-term oil supply deal. The two sides reiterated that the energy cooperation is a key component of the Sino-Russian strategic partnership and said they would push forward collaboration in the oil, gas and electricity sectors.

Russian media quoted First Deputy Prime Minister Dmitry Medvedev as saying that gas deliveries to China would begin "in the next few years" once agreements on the pricing and delivery routes are finalized. Reviewing the decade-old Sino-Russian strategic partnership, Wen said bilateral ties have reached an unprecedented level.

He said the two countries will jointly explore the potential in various fields and improve the trade structure to raise the proportion of machinery and high-tech products. They will expand investment and enhance cooperation in border areas as well as in the fields of space flight, civil aviation, information industry and banking.

Official figures show that two-way trade is expected to top $40 billion by the end of the year. Zubkov said he believes the figure would jump to $80 billion in three years, a goal set by the top leaders of the two countries.

The origins of medical ethics can be traced back to the 4th century BC. They encompass the Hippocratic writings and ancient Rabbinical and early Christian works; over time, contributions were made by Islamic physicians, liberal theorists and moral theologians.

What emerged, however, was not a specific set of answers to the difficult ethical questions doctors faced, but a framework - underpinned by core values - within which to understand ethical dilemmas. And while these core values tend to endure, what we consider to be ethical practice often changes over time.

Two of these lasting concepts are primum non nocere - first do no harm - and beneficence, that a doctor should always act in the best interests of the patient. But what we judge to be ethical practice is really just a matter of interpretation. Our understanding of "first do no harm", for example, may be very different from that of our ancestors.

If, from an ethical perspective, a doctor is allowed to terminate a pregnancy at 23 weeks because the chance of the child surviving is so slim, why is it not acceptable to extend the same rationale to adults? The more you consider it, the more apparent it becomes that ethics are anything but consistent. Someone with a terminal illness has, by definition, a survival rate of zero, worse than that of a 22-week-old foetus.

And yet, as a doctor, it is considered ethical for me to terminate a 22-week pregnancy - there are about 500 terminations a year done at this stage - but unethical for me assist in the death of someone whom I know is going to die. Surely the way in which we are applying our ethical framework is flawed?

This is not to say we should not abort babies at 22 or 23 weeks, but rather, if we accept that it is morally acceptable to do so on the grounds of viability, then we should give proper thought to whether the same rule should be applied to us all.

The currency declined to the weakest versus the Canadian dollar since it started trading freely, a 26-year low against the pound and a 23-year low to the Australian dollar. "We will favor stronger currencies over weaker ones, and will readjust accordingly," Cheng Siwei, vice chairman of China's National People's Congress, told a conference in Beijing.

"We're likely to see further pressure on the dollar," said Thomas Harr, senior foreign exchange strategist in Singapore at Standard Chartered Plc, a U.K. bank that makes most of its profit in Asia. "The potential for diversification is quite big. This is a structurally negative story for the dollar."

The U.S. currency slumped to $1.4666 per euro, the lowest since the 13-nation currency debuted in January 1999, before trading at $1.4644 at 2:56 p.m. in Tokyo from $1.4557 late yesterday. It fell to $1.0990 per Canadian dollar, the lowest since Canada's currency was floated in 1950. The dollar traded as low as 113.99 yen, the first time below 114 since Oct. 29.

The dollar may fall to $1.50 against the euro, Harr said.

Against the pound, the dollar declined to $2.0947, the lowest since May 1981. The currency slid against the Australian dollar to 93.81 U.S. cents, the lowest since April 1984 from 92.87 U.S. cents. The U.S. currency also fell to as low as 1.1347 against the Swiss franc, the lowest since December 2004. "This is an asset story and shows sentiment for the dollar continues to be quite negative," said David Forrester, currency economist at Barclays Capital in Singapore.

Traders remain worried about whether supplies will be adequate to meet demand for heating fuel in the approaching Northern Hemisphere winter. News of an attack Monday on an oil pipeline in Yemen added to those concerns.

The weak U.S. dollar, which fell to a new low against the euro Tuesday, is also lifting oil prices. Oil futures offer a hedge against a weak dollar, and oil futures bought and sold in dollars are more attractive to foreign investors when the greenback is falling.

OLMERT SETS TIMELINE FOR TERRORIST STATE

Israeli Prime Minister Ehud Olmert hopes to reach a peace deal with the Arabs before US President George W. Bush leaves office in January 2009, an Israeli government official said on Friday. "There are big advantages to reaching an agreement before the end of Bush's term. This is the right thing to do. It is the best thing to do for both sides," the official quoted Olmert as telling German Foreign Minister Frank-Walter Steinmeier. The official said Olmert wanted to seize the opportunity because it was impossible to know how committed the next U.S. administration would be to solving the Israeli-Arab conflict

US-SUPPORTED TERRORIST ORGANIZATION PROMISES RAIN OF ROCKETS

The Al-Aqsa Martyrs Brigades, a wing of the Fatah terrorist organization headed by Palestinian Authority (PA) Chairman Mahmoud Abbas, stated Thursday that it has begun an escalation in attacks on Israeli towns in the Negev. The group said the attacks would be a response to "the evil Balfour declaration," which was issued 90 years ago this past Friday. The Balfour Declaration paved the way for the creation of a Jewish state in the Land of Israel. Spokesmen for Fatah in Gaza boasted that their organization has carried out dozens of terrorist attacks on nearby Jewish towns. [The AL-AQSA MARTYRS BRIGADES is designated as a terrorist organization under US federal law. IT IS A PART OF THE FATAH TERRORIST ORGANIZATION, which is LED BY ITS FOUNDER, PA CHAIRMAN MAHMOUD ABBAS. US PRESIDENT GEORGE W. BUSH, A STAUNCH SUPPORTER OF ABBAS, RECENTLY ORDERED THE TRANSFER OF $410 MILLION TO THE PA, IN DIRECT VIOLATION OF FEDERAL LAWS AGAINST FUNDING FOREIGN TERRORIST ORGANIZATIONS. While proclaiming a "war" against terrorism in the rest of the world, Bush supports the Fatah terrorist organization in Israel, who have sworn to wipe the Jewish people off the face of the earth. [Arutz Sheva, Jerusalem Post]

ECONOMY RECEIVES BLESSING FROM THE LORD

Israel has one of the fastest growing and safest economies in the world -- despite competition from hot Asia giants and Arab petrodollar countries. In the Middle East it is an economic giant. Israel had the fastest growing GNP (8%) of any western country in the fourth quarter of 2006. In 2006, the Israeli high-tech exports totalled $14.1 billion, up 20% over 2005. Israel means business. Israeli currency has appreciated considerably against the dollar - a good way to beat inflation. Only about 15% of Israeli exports are accounted for by the diamond industry, and an additional 82% are non-diamond manufacturing exports, of which about 40-50% is high tech. [Zionism & Israel]

WAQF SUED OVER TEMPLE MOUNT DESTRUCTION

A group of 150 Israeli citizens, which represent a broad cross section of the Israeli public, have initiated an unprecedented criminal prosecution of Waqf (Islamic trust) leaders in Jerusalem, alleging that they have engaged in the deliberate destruction of ancient Jewish relics on the Temple Mount. The indictment was filed in the Jerusalem District Court Thursday by means of a private law suit, which is first of its kind in Israeli legal history and utilizes a seldom applied section of the criminal code. If convicted, the Waqf officials may face years in prison. The legal action is led by Shurat HaDin (Israel Law Centre). In recent months the Waqf has brought in bulldozers and heavy digging equipment to carry out "renovations". Israeli archaeologists who have sifted through the discarded earth were shocked to have discovered a great number of Jewish artefacts brutally trashed by the bulldozers. A wall from the outer courtyard of the Second Temple is believed to have been completely pulverized. The court papers contend that the recent accelerated destruction is part of a four decade long campaign by the Waqf to eradicate all evidence of the historical Jewish connection and claim to the Temple Mount. After liberating the Old City in 1967, Israel permitted the Waqf to remain as "custodians" of the Temple Mount. Shurat HaDin alleges that the Israeli government, in its political cowardice, has consistently refused to undertake any concrete actions to stop the criminal activities of the Waqf - thus abandoning the millenniums long Jewish claim over the Temple Mount and allowing Islamic extremists to re-write history in Jerusalem. [Shurat HaDin]

FATAH-CONTROLLED TV PROMISES ELIMINATION OF ISRAEL

A new music video appearing regularly on Fatah-controlled PA television over the past week promises the elimination of Israel and the restoration of the "Arab identity" of cities throughout the Jewish State. The propaganda clip stands in stark contrast to PA Chairman Mahmoud Abbas's recent declarations in support of reconciliation with Israel, issued ahead of the upcoming multinational Middle East peace conference organized by the United States. As explained by Itamar Marcus and Barbara Crook of PALESTINIAN MEDIA WATCH, "WHILE THE PALESTINIAN AUTHORITY ANNOUNCES IN ENGLISH ITS DEMAND FOR A TWO-STATE SOLUTION, TO ITS OWN PEOPLE IN ARABIC IT CONTINUES TO DEFINE ALL OF ISRAEL AS 'PALESTINE,' AND TO PROMISE ISRAEL'S DESTRUCTION. A new video clip, broadcast numerous times daily since it first appeared on Fatah-controlled TV last week, passionately promises 'Mother' that every Israeli city will be 'liberated' because its 'identity is Arab' and 'Palestinian.'" [Arutz Sheva]

The film on video-sharing website YouTube is entitled In memory of Councillor Alan Craig and contains pictures of him with his wife and two young daughters. It was apparently posted in retaliation for his opposition to the mosque. Mr Craig has now contacted police in fear of his family's safety and demanded that the video be taken down.

Islamic group Tablighi Jamaat wants to open the 12,000-capacity "mega-mosque" in Newham near the main 2012 Olympic site. The FBI has described the group as "a recruiting ground" for al Qaeda, which it denies.
Shoebomber Richard Reid and 7/7 bombers Mohammad Sidique Khan and Shehzad Tanweer were members.

Mr Craig, 61, a member of the Christian Peoples Alliance on Newham council, has led a local campaign against the mosque which is planned for the site at Abbey Mills next to West Ham Tube station. The businessman today said he would be seeking advice about whether his 40-year-old wife, Sally, and daughters were safe. He said: "Targeting me is one thing. But to use my wife and children is outrageous. This video obituary is either a threat or a very sick joke.

"Some people will look at this as an open invitation to take me out because I am opposing the mosque. That is not the way to operate in a democracy." The video opens with its title and the words "To God we will all return" before showing a series of photos of the councillor, his family and political allies set to Elvis Presley singing You Were Always On My Mind. The two-minute video ends with the message "The mosque will be built in time for the 2012 Olympic Games."

Meredith Whitney, the CIBC World Markets' financial services analyst, believes the only way forward for new chairman Robert Rubin and interim chief executive Sir Win Bischoff is to carve the bank up and sell it off.
MS WHITNEY'S COMMENTS LAST WEEK ON THE STATE OF CITI'S BALANCE SHEET SPARKED A $369BN (£177BN) FALL IN WORLD MARKETS AND HELPED TRIGGER AN EMERGENCY MEETING OF THE BANK'S BOARD AT THE WEEKEND AT WHICH MR PRINCE TENDERED HIS RESIGNATION.

Citi is the largest victim to date of the global credit crisis, announcing further write-downs of up to $11bn on top of $5.9bn revealed in the third quarter. Asked about the possibility of a Citi break-up, Ms Whitney, who received death threats following her comments last week, said: "That's really the only thing they can do. THEY DON'T HAVE THE CAPITAL TO MANAGE IT AS AN ONGOING ENTITY."

Ms Whitney's views stem from her belief that Citi does not have enough capital to meet its existing commitments, something the bank denied in a statement on its financing on Sunday evening. She believes that Citi needs to begin to sell off non-core assets or cut its dividend. But chief financial officer Gary Crittenden, a contender to replace Mr Prince, yesterday told banking analysts that Citi has no intention of cutting the dividend.

Ms Whitney responded by saying: "CLEARLY THE MATHS DO NOT ADD UP."

Shares in the oil and gas company, which raised $9bn from the world's biggest initial public offering so far this year, surged to Rmb48.60 at the start of trading from an offer price of Rmb16.70.

The massive demand for the PetroChina offering is the latest sign of the stock market frenzy in mainland China where share prices have increased almost six fold over the past two years. PetroChina attracted $456bn of subscriptions from retail and institutional investors in China.

However, the surge in the company's share price was greeted by some analysts as a further sign that a dangerous bubble is developing in the mainland stock market, created by a mixture of capital controls and substantial liquidity. The company's mainland shares are now trading at a premium of around 150 per cent to its Hong Kong shares.

Bill Gross, the chief investment officer of Pacific Investment Management, said US mortgage delinquencies and defaults would rise in 2008. "THERE ARE $1 TRILLION WORTH OF SUB-PRIMES, ALT-AS [SELF-CERTIFIED] AND BASICALLY GARBAGE LOANS," HE SAID, ADDING THAT HE EXPECTS SOME $250BN IN DEFAULTS. "WE'VE ONLY BEGUN TO SEE THE PAIN FROM RISING MORTGAGE PAYMENTS," he added. Brian Gendreau, an investment strategist at ING, commented: "Financials are 20 per cent of the S&P 500 and if that sector doesn't do well all bets are off. PEOPLE JUST DON'T KNOW WHAT'S ON THE BALANCE SHEETS."

The banks remain unwilling to lend to each other, preferring to rebuild their balance sheets and "hoard liquidity" to buttress themselves against any shocks from repatriating off-balance-sheet losses from their special investment vehicles (SIVs). However, this tightening up has led to a vicious circle. Making credit tougher has exacerbated the problems of struggling mortgage holders in America; default rates then rise and make the banks even more exposed to losses as credit agencies downgrade their assets.

This seems to be what happened at Citigroup. The admission that it was unable to assure investors that a potential $11bn write-down for sub-prime mortgages would not grow has led to this fresh fit of extreme nervousness. Huge write-downs by Merrill Lynch ($7.9bn) and UBS ($3.4bn) have not helped.

Samir Shah at Landsbanki Securities said: "People thought most of the bad news had been priced in. IT SEEMS WE'RE ENTERING A SECOND PHASE OF THE CREDIT SQUEEZE. We're going back to a place where liquidity is drying up and volatility is increasing."

The Chancellor, Alistair Darling, also pleaded for calm. "We are experiencing an unparalleled period of financial uncertainty caused by the problems in the US housing market," he said. "I believe that we can get through that. Many banks in this country have very strong balance sheets after years of making very good profits."

Meanwhile, on the continent, newspaper reports named two German banks - WestLB and a small specialised bank for professional people - as possible next victims of the crisis.

If they had, they may well have been charged with a criminal offence, and would not have had a legal leg to stand on in court. The UK places great emphasis on respecting the religious convictions of patients - and increasingly the doctors who treat them too.

There is nothing medics can do when an adult refuses treatment on religious grounds, says Vivienne Nathanson, head of ethics at the British Medical Association. "It's something we just have to live with - the alternative would be to change the law, change the human rights law," she says. "It's just too important that we all as individuals are able to make our own decisions."