The run on the bank continued yesterday as police were called in to keep the peace when angry and desperate customers besieged branches across the country despite assurances from the Treasury and Bank of England that their savings were secure. Branches due to close at midday opened until 2pm, but many hundreds of people were still trying to get their money when the branches closed and minor scuffles and arguments broke out.

Senior executives at Northern Rock spent yesterday at its Newcastle head office monitoring events, but the lender is seen to have little future as an independent entity. It held talks about a possible takeover by Lloyds TSB before the crisis and is expected to be sold off cheaply to a rival. The bank, which saw £1 billion taken out by worried savers on Friday and at least £500m removed yesterday, is prepared for a further flood of withdrawals when branches open tomorrow. Many will be by customers with nearly £10 billion in postal accounts, who can only make withdrawals by writing to the bank.

"The question is why wouldn't you take your money out and put it somewhere else," said one senior banker, who predicted £12 billion worth of withdrawals from the bank, which has £24 billion in deposits from savers. Though Northern Rock is solvent, a lot of people have been gripped by the fear that they might lose some of their savings. It is a huge problem.

In the first six months of this year, it was responsible for one in five new mortgages and offered generous loans - up to 125% of the value of the property - to first-time buyers.

One banking analyst warned: "It is not beyond the realms of possibility that they could lose half of their deposit base, if not more. We have not had a decent run on a bank for many, many years. The difference now is the internet and that means you can get your money out very quickly. Banking is about confidence and that has gone from Northern Rock in a spectacular way."

"We had the first confirmed use of an Army weaponized UAV," said Col. Don Hazelwood, project manager for Army Unmanned Aircraft Systems at Redstone Arsenal, Ala. The Army is mounting precision-guided weapons on hundreds of unmanned aerial vehicles in Iraq and Afghanistan, Hazelwood said.

The MQ-5B Hunter will carry the laser-guided GBU-44/B Viper Strike, a 42-pound glide bomb with a one-yard wingspan that can strike within one meter of its aim point. The number of UAVs in combat is rising, from about 1,000 last year to 1,350 expected by the end of this year. Flight hours have soared from 60,000 last year to 140,000 so far this year, Hazelwood said.

The number of video terminals that display live imagery beamed from UAVs has jumped to 1,000, up from 200 six months ago, he said. They are installed in Stryker vehicles on their way to Iraq, and should be in Apache cockpits by next summer, said Kim Henry, a spokeswoman at the Army's Redstone Arsenal, Ala.

"These terminals receive video from any of our platforms. You can see where you are located and see what UAV operators are seeing as well. Now the Apache pilot is able to see before he gets to a target," Owings said.

The terminals allow soldiers to see around corners, over hills and buildings, and into neighboring areas during combat, said one senior Army leader who recently returned from Iraq. He said more surveillance, communications and reconnaissance technologies are changing things.

I was at Maryland University just outside Washington DC, where Professor Challapa and his team are inventing the next generation of citizen surveillance. Gait DNA, for example, is creating an individual code for the way I walk. Their goal is to invent a system whereby a facial image can be matched to your gait, your height, your weight and other elements, so a computer will be able to identify instantly who you are.

"As you walk through a crowd, we'll be able to track you," said Professor Challapa. "These are all things that don't need the cooperation of the individual. Then there's the problem of language. Unless we're going to train every American citizen and soldier in 16 different languages we have to develop a technology that allows them to understand - whatever country they are in - what's going on around them".

"I hope in the future we'll be able to have conversations, if say you're speaking in French and I'm speaking in English, and it will be natural. And the computer will do the translation? Yep. All by computer," he said.

"And this idea about a total surveillance society, is that science fiction?" I asked. "No, that's not science fiction. We're developing an unmanned airplane - a UAV - which may be able to stay up five years with cameras on it, constantly being cued to look here and there. This is done today to a limited amount in Baghdad. But it's the way to go."

So far there is no gadget that can actually see inside our houses, but even that's about to change. Ian Kitajima flew to Washington from his laboratories in Hawaii to show me sense-through-the-wall technology. "Each individual has a characteristic profile," explained Ian, holding a green rectangular box that looked like a TV remote control.

Using radio waves, you point it a wall and it tells you if anyone is on the other side. His company, Oceanit, is due to test it with the Hawaiian National Guard in Iraq next year, and it turns out that the human body gives off such sensitive radio signals, that it can even pick up breathing and heart rates.

"First, you can tell whether someone is dead or alive on the battlefield," said Ian. "But it will also show whether someone inside a house is looking to harm you, because if they are, their heart rate will be raised. And 10 years from now, the technology will be much smarter. We'll scan a person with one of these things and tell what they're actually thinking."

He glanced at me quizzically, noticing my apprehension. "Yeah, I know," he said. "It sounds very Star Trekkish, but that's what's ahead."

The Israeli government was not saying. "The security sources and IDF [Israeli Defence Forces] soldiers are demonstrating unusual courage," said Ehud Olmert, the prime minister. "We naturally cannot always show the public our cards."

The Syrians were also keeping mum. "I cannot reveal the details," said Farouk al-Sharaa, the vice-president. "All I can say is the military and political echelon is looking into a series of responses as we speak. Results are forthcoming." The official story that the target comprised weapons destined for Hezbollah, the Iranian-backed Lebanese Shi'ite group, appeared to be crumbling in the face of widespread scepticism.

According to Israeli sources, preparations for the attack had been going on since late spring, when Meir Dagan, the head of Mossad, presented Olmert with evidence that SYRIA WAS SEEKING TO BUY A NUCLEAR DEVICE FROM NORTH KOREA. The Israeli spy chief apparently feared such a device could eventually be installed on North-Korean-made Scud-C missiles.

"This was supposed to be a devastating Syrian surprise for Israel," said an Israeli source. "WE'VE KNOWN FOR A LONG TIME THAT SYRIA HAS DEADLY CHEMICAL WARHEADS ON ITS SCUDS, BUT ISRAEL CAN'T LIVE WITH A NUCLEAR WARHEAD."

By its actions, Israel showed it is not interested in waiting for diplomacy to work where nuclear weapons are at stake. As a bonus, the Israelis proved they could penetrate the Syrian air defence system, which is stronger than the one protecting Iranian nuclear sites.

This weekend President Mahmoud Ahmadinejad of Iran sent Ali Akbar Mehrabian, his nephew, to Syria to assess the damage. The new "axis of evil" may have lost one of its spokes.

Pentagon planners have developed a list of up to 2,000 bombing targets in Iran, amid growing fears among serving officers that diplomatic efforts to slow Iran's nuclear weapons programme are doomed to fail. Pentagon and CIA officers say they believe that the White House has begun a carefully calibrated programme of escalation that could lead to a military showdown with Iran.

Now it has emerged that Condoleezza Rice, the secretary of state, who has been pushing for a diplomatic solution, is prepared to settle her differences with Vice-President Dick Cheney and sanction military action. In a chilling scenario of how war might come, a senior intelligence officer warned that public denunciation of Iranian meddling in Iraq - arming and training militants - would lead to cross border raids on Iranian training camps and bomb factories.

A prime target would be the Fajr base run by the Iranian Revolutionary Guard Quds Force in southern Iran, where Western intelligence agencies say armour-piercing projectiles used against British and US troops are manufactured. Under the theory - which is gaining credence in Washington security circles - US action would provoke a major Iranian response, perhaps in the form of moves to cut off Gulf oil supplies, providing a trigger for air strikes against Iran's nuclear facilities and even its armed forces.

Senior officials believe Mr Bush's inner circle has decided he does not want to leave office without first ensuring that Iran is not capable of developing a nuclear weapon. The Sunday Telegraph has been told that Mr Bush has privately promised her that he would consult "meaningfully" with Congressional leaders of both parties before any military action against Iran on the understanding that Miss Rice would resign if this did not happen.

The intelligence officer said that the US military has "two major contingency plans" for air strikes on Iran. "One is to bomb only the nuclear facilities. The second option is for a much bigger strike that would - over two or three days - hit all of the significant military sites as well. This plan involves more than 2,000 targets."

The planes, said the report, were equipped with 'Maverick' heavy missiles and 500 pound bombs. Escorting the pilots high above them was an ELINT - an electronic intelligence gathering aircraft - the report claimed.
Over the weekend, reports in the American media claimed that the so-called raid targeted a North Korean-Syrian nuclear facility.

According to The Washington Post, Israel had been keeping a watchful eye on the facility, which is officially characterized by the Syrians as an agricultural research center. The offending shipment arrived at the Syrian port of Tartus on September 3, three days before the reported IAF raid.

John Bolton, the former US ambassador to the UN, told The Jerusalem Post over the weekend that "simple logic" suggested North Korea and Iran could have outsourced nuclear development "to a country that is not under suspicion" - namely Syria. Tellingly, he added: "Why would North Korea protest about an Israeli strike on Syria?"

Over the past 12 years or so, we have enjoyed the benefits of rising property prices and low interest rates underpinned by stable global markets. BUT THIS PERCEPTION OF "EASY MONEY" HAS LULLED US INTO A SENSE OF COMPLACENCY. We are therefore entitled to ask what's going on - and whether those running our markets are playing fast and loose with the financial security of the nation.

My name (NICK LEESON) is linked to one of the most notorious banking scandals in recent times, when my reckless trading led to the collapse of Barings, the UK's oldest merchant bank. My experience tells me there are three main reasons for the crisis that has led to the Bank of England stepping in to guarantee emergency credit to solve Northern Rock's liquidity problems:

GREED, INCOMPETENCE AND A NAÏVE RELIANCE ON THE POWER OF COMPUTERS TO PREDICT THE FUTURE.

My own actions in the period 1992-95 were fraudulent and I was duly punished. But my downfall distracted attention from the shortfalls of the system. BARINGS WOULD NEVER HAVE COLLAPSED WITHOUT THE INCOMPETENCE OF OTHERS WHO SHOULD HAVE KNOWN WHAT WAS GOING ON BUT EITHER FAILED TO DETECT IT, DIDN'T PROPERLY INVESTIGATE OR TURNED A BLIND EYE.

But there is a larger picture to consider. Mr King also said last week: "IF RISK CONTINUES TO BE UNDER-PRICED, THE NEXT PERIOD OF TURMOIL WILL BE ON AN EVEN BIGGER SCALE." Of course, he is absolutely correct. But somebody should have seen this coming.

Personal debt levels have been hitting new highs, month after month, for years and there has been no real attempt to dissipate demand. Sub-prime lending has never been properly regulated - and now it is in danger of pulling everyone down. YET AGAIN, BANKERS AND THOSE WHO REGULATE AND POLICE THEM HAVE PLACED AT RISK NOT ONLY THEIR OWN JOBS BUT THE LIVELIHOODS OF EVERYONE IN BRITAIN AND ACROSS THE WORLD.

GREED FOR QUICK PROFIT IS AGAIN AT THE CENTRE OF THESE PROBLEMS.

Lord Oxburgh, the former chairman of Shell, has issued a stark warning that the price of oil could hit $150 per barrel, with oil production peaking within the next 20 years.

He accused the industry of having its head "in the sand" about the depletion of supplies, and warned: "We may be sleepwalking into a problem which is actually going to be very serious and it may be too late to do anything about it by the time we are fully aware."

In an interview with The Independent on Sunday ahead of his address to the Association for the Study of Peak Oil in Ireland this week, Lord Oxburgh, one of the most respected names in the energy industry, said a rapid increase in the price of oil was inevitable as demand continued to outstrip supply. He said: "We can probably go on extracting oil from the ground for a very long time, but it is going to get very expensive indeed and once you see oil prices in excess of $100 or $150 a barrel, the alternatives simply become more attractive on price grounds if on no others."

The International Energy Agency has forecast what it calls an oil "supply crunch" by 2012, a prediction that Lord Oxburgh said could possibly come to pass. Lord Oxburgh is currently chairman of D1 Oils, a biodiesel company listed on the AIM market.

In his long-awaited memoir, to be published tomorrow, Greenspan, a Republican whose 18-year tenure as head of the US Federal Reserve was widely admired, will also deliver a stinging critique of President George W Bush's economic policies.

However, it is his view on the motive for the 2003 Iraq invasion that is likely to provoke the most controversy. "I am saddened that it is politically inconvenient to acknowledge what everyone knows: the Iraq war is largely about oil," he says.

Greenspan, 81, is understood to believe that Saddam Hussein posed a threat to the security of oil supplies in the Middle East. Britain and America have always insisted the war had nothing to do with oil. Bush said the aim was to disarm Iraq of weapons of mass destruction and end Saddam's support for terrorism.

The Episcopal Church is on the verge of a mass exodus if it doesn't repent of its approval of homosexual relationships, warn the leaders of three dioceses that signaled their intent this week to leave the 2 million-member denomination.

The dioceses of Fort Worth, Pittsburgh and Quincy, Ill., have stated that if they don't receive assurances by Sept. 30 that the House of Bishops will reject the consecration of bishops living in a same-sex relationship and same-sex blessings, they are prepared to cut themselves off from the Episcopal Church in the USA. "The Episcopal Church now faces potentially large numbers of departures that would make what has happened until now look like the calm before a storm," said Ralph Webb, director of Anglican Action for the Institute on Religion and Democracy.

Noting a trend that has developed over more than three decades, Webb said the denomination "has moved so far away from Scripture, Christian tradition and reason that many faithful Christians feel that they can no longer stay within the Episcopal Church and be faithful."

Scores of people have died and much of the continent's most fertile farmland has been washed away in what is being described as a humanitarian disaster. The UN said more rain was expected and warned that the need for food, shelter and medicine was urgent. Some 17 countries have been affected in West, Central and East Africa.

UN spokeswoman Elisabeth Byrs said: "The rains are set to continue and we are really concerned because a lot of people are homeless and infectious diseases could emerge. Some of the poorest countries, like Mali, Burkina Faso and Niger - the poorest nation in the world - are badly affected." The UN said the floods could lead to locust infestations and outbreaks of diseases such as cholera and dysentery.

MORE IMMIGRATION INTO EU
The EU Foreign Affairs commissar, Benito Ferrero-Waldner (a former Foreign Minister of Austria) has said that the EU wants to make it easier for migrants from third countries like Ukraine, Moldova or Egypt to come and work in the EU. [Christoph Schlitz, Die Welt, 2 September 2007]

NO EU MEMBERSHIP FOR UKRAINE
The announcement coincides with a statement by Commissar Ferrero-Waldner that "EU membership for Ukraine is not possible at the present time." [Christoph Schlitz, Die Welt, 2 September 2007]

BOAT PEOPLE CONTINUE TO ARRIVE IN SPAIN
Although there had been a small lull in illegal immigrants, people are again continuing to arrive from Africa in their hundreds every day by boat in the Canary Islands [Cécile Chambraud, Le Monde, 29 August 2007]

1 MILLION EURO A DAY STOLEN FROM EU
The total amount of fraud committed in Brussels amounts to 1 million euros per day. There are currently 400 investigative procedures pending against EU officials, of which about 70 are officials from the European Commission. [Hans-Jürgen Schlamp, Der Spiegel, 27 August 2007]

AUSTRIAN FM SAYS NEW TREATY SAME ONLY BETTER
The Austrian Foreign Minister, Ursula Plassnik, has said that the new treaty is better than the defunct constitution which it replaces but that it retains that document's essential features. [Der Standard, 5 September 2007]

EU TO THE RESCUE
The forest fires which have ravaged Greece are being used by Euro-integrationists to argue for a EU emergency force which would "co-ordinate" the civil protection forces of the 27 EU Member States.

The last time the Bank was forced to take such a radical step was in 1973-74 when it created a 'lifeboat' to keep a dozen fringe banks, which had gambled on property prices always rising, from going bankrupt and taking people's life savings with them.

Now the Bank, the Chancellor Alistair Darling and Northern Rock boss Adam Applegarth are doing their level best to convince the public that the decision to step in was a matter of 'liquidity' not 'solvency'. They argue that Northern Rock has a temporary cash shortage but is not in danger of going bust. This allows Northern Rock to carry on. All of this is just semantics. If the Bank of England were not willing to make sure that Northern Rock has the necessary cash, it would, in effect, be insolvent.

Depositors who sought to pull out their money from the bank's branches would not be able to do so. Nor would other banks, doing business with Northern Rock in the money markets, be repaid. There seems little doubt that the Newcastle-based bank has behaved stupidly. It committed a basic sin in finance.

It raised cash which has to be replenished regularly with new money over a short time frame. It then lent this same money for ten, 20 and 30 years. This is fine when cash is easy to come by and interest rates are low. But when rates rise, as they have on both sides of the Atlantic this year, and there is a crisis of confidence then the short term money, which financial groups supply to each other, dries up and it becomes increasingly difficult to renew the original cash borrowed.

In fact, just at the moment when the housing market was peaking and money conditions were getting tighter, Northern Rock sought to increase its share of the home-loan market, grabbing an astonishing 19 per cent in the first half of this year.

It is that mad dash for growth for which it is now paying the price. The truth is that the debt and credit explosion of the last decade was always going to end in tears, but it sometimes needs a shock to the system to bring lenders and borrowers back to their senses. There can be no doubt that in the present global financial earthquake, the Bank of England was slower to react than its counterparts.

Had it sought to massage interest rates down, making liquidity more available, then a bail-out for Northern Rock might not have been necessary. Gordon Brown and the Chancellor must now hope that by finally taking decisive action the authorities have headed off a potentiallydevastating economic turndown.

But with so much of Britain's growth based in the financial sector, such an outcome cannot be taken for granted.

Historically, the Northwest Passage linking the Atlantic and Pacific Oceans has been ice-bound through the year. But the agency says ice cover has been steadily shrinking, and this summer's reduction has made the route navigable. The findings, based on satellite images, raised concerns about the speed of global warming.

The Northwest Passage is one of the most fabled sea routes in the world - a short cut from Europe to Asia through the Canadian Arctic. Recent years have seen a marked shrinkage in its ice cover, but this year it was extreme, Esa says. It says this made the passage "fully navigable" for the first time since monitoring began in 1978.

Canada says it has full rights over those parts of the Northwest Passage that pass through its territory and that it can bar transit there. But this has been disputed by the US and the European Union. They argue that the new route should be an international strait that any vessel can use.

Parts of Ghana have been declared a disaster zone, while on the other side of the continent, many thousands are now homeless in Ethiopia and Uganda. The UN said the floods could lead to locust infestations and outbreaks of water-borne diseases such as cholera. The flooding and torrential rain have brought chaos to at least 14 countries.

UN Office for the Coordination of Humanitarian Affairs spokeswoman Elisabeth Byrs said 500,000 people had been affected in West Africa and a further 500,000 in Sudan, and the numbers were rising. In Uganda, where at least nine people are reported to have died, government minister Musa Ecweru said the situation "borders a crisis. Several communities have been cut off and we cannot access them," he said.

In Ethiopia, one of the worst-hit east African nations, deaths have been reported and a massive food aid programme has been set up after flooding hit almost 200,000 people. In West Africa, Ghana has been hit particularly hard, with at least 20 people killed and about 400,000 people made homeless.

In neighbouring Togo some 34,000 people have been displaced, at least 20 killed and the infrastructure has suffered major damage.

Officials in northern Rwanda said 15 people had died there and 500 homes had been destroyed since Wednesday. Dozens are also reported dead in Sudan, which has been suffering some of the worst floods in living memory.

Kenyan government spokesman Alfred Mutua told the AFP news agency: "We have activated our disaster response and the government and aid groups are providing food, shelter and medicine to those affected by the floods." Niger, Nigeria, Liberia, Mali and Burkino Faso are among other countries affected.