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.

With British mortgage lender Northern Rock the latest financial institution to require emergency central bank help, any hopes of a quick return to normal financing conditions have received a severe dent.

"Whether the news of Northern Rock's woes constitutes a final exclamation mark in the whole credit debacle or is the beginning of a more serious phase of problems for the sector is a question that we imagine was most troubling investors," said Neil Mellor, strategist at Bank of New York Mellon.

Billions of dollars of pent-up refinancing from the August seizure still need to be negotiated, there is concern about what private-sector banks may reveal during the third-quarter earnings season and decisions from top central bank meetings also hang in the balance.

But it's the lack of a single hose to douse the flames that leads policymakers to accept this disruption will have a more durable impact on world economic growth than previous banking shocks -- such as the ones that followed Asia's emerging market collapse and Russia's default in the late 1990s.

U.S. Treasury Secretary Henry Paulson warned this week that the dent to market confidence boosting short-term borrowing costs by more than half a percentage point would not dissipate quickly. The European Central Bank echoed that on Thursday.

The United States, Germany, France and Britain have led a diplomatic drive to punish Iran for refusing to halt its uranium enrichment program. They succeeded in persuading reluctant Russia and China to back two U.N. sanctions resolutions. Despite the sanctions, which have led to a sharp decrease in Western trade with Iran, Tehran refuses to abandon a program it says is meant for the peaceful generation of electricity.

Washington, which suspects Iran is seeking nuclear weapons, believes the time has come to expand the sanctions and has called a September 21 meeting of the six powers to discuss a third sanctions resolution to submit to the U.N. Security Council.

France said on Friday it was ready to take fresh action. "We wish to have new sanctions adopted, as a priority in the U.N. Security Council," Foreign Ministry spokesman Frederic Desagneaux told a regular news conference in Paris. Germany, however, said discussion of fresh sanctions would not be necessary if Iran cooperated with the United Nations and cleared up doubts about its nuclear program.

"Germany is ready, if necessary, to take the necessary steps against Iran," Foreign Ministry spokesman Martin Jaeger said. But as a member of the International Atomic Energy Agency (IAEA), Germany was also open to "giving Iran a chance to recover the international community's lost confidence in its nuclear program," Jaeger said at a regular news conference.

Mostafa Pour Mohammadi said he had reached a consensus on the issue in meetings in Beijing with Foreign Minister Yang Jiechi and senior foreign policy adviser Tang Jiaxuan. "The two sides agreed that other methods such as sanctions are inappropriate and ineffective," Pour Mohammadi told reporters at the Iranian Embassy.

Asked whether China had urged more active cooperation with the International Atomic Energy Agency, Pour Mohammadi replied, "It's natural that our friends in other countries hope that talks conclude successfully."
China's official Xinhua News Agency quoted Yang as saying China supported a negotiated settlement and opposed the spread of nuclear weapons.

"China would like to continue its efforts to push forward the peaceful resolution of Iran's nuclear issue," Xinhua quoted Yang as saying.

But experts and officials insist that Northern Rock, which has £113bn in assets, is not in danger of going bust.

Despite the reassurances, lines of customers formed outside many Northern Rock branches around the UK.

The bank has struggled to raise money to finance its lending ever since money markets seized up over the summer.

Other bank shares fell, with Bradford & Bingley, Alliance & Leicester and HBOS down nearly 8%, 7% and 4% respectively. House builders were also hit, with companies like Persimmon, Taylor Wimpey, Bovis Homes and Berkeley Group falling around 6% and more.

The Daily Telegraph has learned that existing safeguards preventing EU interference with national identity documents have been quietly dropped. Sources close to negotiations suggest that Britain has allowed the safeguards to be removed in order to participate in EU security measures, such as biometric passports and ID cards.

William Hague, the shadow foreign secretary, said: "Gordon Brown has absolutely no democratic mandate to sign Britain up to a possible Euro ID card scheme. It illustrates how important it is that the British people have their promised say on this treaty."

Derek Scott, chairman of the I Want A Referendum campaign, said: "Under the Constitutional Treaty, work on harmonisation of identity documents would gain momentum. The EU is doing a lot of radical things in this area with far too little scrutiny, so it's no wonder that many people are uncomfortable with this."

The report was withdrawn after huge protests by opposition parties. The report was presented to the Supreme Court on Wednesday in connection with a case against a proposed shipping canal project between India and Sri Lanka. Hindu hardliners say the project will destroy what they say is a bridge built by Ram and his army of monkeys.

Scientists and archaeologists say the Ram Setu (Lord Ram's bridge) - or Adam's Bridge as it is sometimes called - is a natural formation of sand and stones. On Wednesday, Hindu hard-line organisations blocked roads across India to protest against the Sethusamudram Shipping Canal Project. Commuters in the capital, Delhi, were stuck in traffic jams for hours as Vishwa Hindu Parishad (World Hindu Council) and Bajrang Dal blocked roads at various places. Road blocks were also held in Bhopal, the capital of the central state of Madhya Pradesh, on the Delhi-Agra highway and on the Jaipur-Agra highway. Train services were disrupted in many places across northern India.

The canal project proposes to link the Palk Strait with the Gulf of Mannar between India and Sri Lanka by dredging a canal through the shallow sea. This is expected to provide a continuous navigable sea route around the Indian peninsula. Once complete, the canal will reduce the travel time for ships by hundreds of miles and is expected to boost the economic and industrial development of the region.