House, Senate All-Nighter Produces Financial Overhaul Bill

Congressional negotiators approved the boldest rewrite of financial rules since the 1930s early Friday, creating a new consumer watchdog, extending regulation to the murky market in derivative investments and taking steps to avoid future Wall Street bailouts. The legislation, which emerged at dawn after all-night negotiations, will go to the full House and Senate for final approval next week. Democrats hope President Obama can sign the bill into law by July 4. The legislation is designed to clean up Wall Street excesses and prevent future bailouts by creating a Consumer Financial Protection Bureau inside the Federal Reserve to police the financial marketplace on behalf of borrowers and savers. A key cause of the financial crisis was an explosion in high-cost, subprime mortgages to borrowers who could not afford them and in many cases could have qualified for cheaper, conventional loans. The bill also Extends regulation to the $600 trillion market in over-the-counter derivatives, potentially risky investments that nearly wiped out insurance giant American International Group, which was rescued with a $180 billion taxpayer bailout. It further grants regulators authority to identify and shut down big, failing financial firms before they can damage the entire financial system, and forcing shareholders and unsecured creditors, not taxpayers, to bear the brunt of losses.

G-8 Vows to ‘Follow Through’ on Aid Pledges

Leaders of the world’s wealthiest nations met with their less fortunate counterparts Friday in hopes of improving on their spotty record of helping the world’s poorest nations. Struggling with their own economies as they emerge from a global recession, President Obama and other leaders nevertheless sought to make good on past pledges of financial assistance that aid groups say have fallen short. The G-8 leaders meeting in Canada released a report earlier in the week that showed donor nations were $18 billion short of a goal set in 2005 — to increase annual development assistance to poor nations by $50 billion within five years. Some countries, including the United States and Canada, met their pledges. But others, led by Italy, fell woefully short, the reports showed. France, Germany and Britain also fell short of what they promised at Gleneagles, Britain, in 2005.

The world’s leaders agreed Sunday to begin transitioning from spending to saving as they walk what Canadian Prime Minister Stephen Harper called a “tightrope” between government stimulus and debt reduction. The tenuous agreement, to halve government deficits by 2013, represented a victory for European leaders such as British Prime Minister David Cameron, who sought tough spending cuts. President Obama had urged colleagues not to abandon government spending too soon. Although a deal was reached on spending and saving, other matters were unresolved. Europe’s desire for a global tax on banks went nowhere. Russia demurred on a stronger denunciation of an alleged North Korea torpedo attack on a South Korean warship. Host Canada got only modest support for its initiative to tackle child and maternal health in developing countries. And there were signs of impatience regarding the lengthy war in Afghanistan, which Cameron said must be righted “this year.”

Black-clad demonstrators broke off from a crowd of peaceful protesters at the global economic summit in Toronto Saturday, torching police cruisers and smashing windows with baseball bats and hammers. Police arrested more than 150 people. Police used shields, clubs, tear gas and pepper spray to push back the rogue protesters. Some demonstrators hurled bottles at police. The roving band wearing black balaclavas shattered shop windows for blocks, including at police headquarters. The goal of the militant protesters was to draw police away from the security perimeter of the summit so that fellow protesters could attempt to disrupt the meeting.

U.S. Chamber Official: Disclose Act ‘Shreds’ Constitution

The Disclose Act that House Democrats passed Thursday would “shred” the U.S. Constitution and represents a “blatant partisan maneuver to protect their incumbency,” according to U.S. Chamber of Commerce Executive Vice President R. Bruce Josten. In an exclusive interview with Newsmax.TV, Josten says the Disclose Act, which passed by a 219 to 206 margin, reveals just how much Democrats fear the nation’s rising anti-incumbent fervor. The administration declared Monday that the Disclose Act “takes great strides to hold corporations who participate in the Nation’s elections accountable to the American people.” But Josten says the act would heavily restrict the rights of more than 100,000 associations nationwide to run ads expressing their political views. The act requires companies and associations to submit a mountain of paperwork to the Federal Election Commission if they want to run an ad.

Gov. Brewer: Most Border-Crossers are Drug ‘Mules’

Expanding on comments made at a candidates’ debate, Arizona Gov. Jan Brewer said today she believes that most illegal immigrants crossing the border are “mules” carrying drugs for Mexican cartels. “I believe today, under the circumstances that we’re facing, that the majority of the illegal trespassers that are coming into the state of Arizona are under the direction and control of organized drug cartels and they are bringing drugs in,” Brewer told the Associated Press. “There’s strong information to us that they come as illegal people wanting to come to work. Then they are accosted and they become subjects of the drug cartel,” she said.

BP has Lost More than $100B in Value

BP’s effort to drill a relief well through 2 1/2 miles of rock to stop the Gulf spill is on target for completion by mid-August, the oil giant said Friday. But BP’s stock tumbled anywayto a 14-year low over the mounting costs of the disaster and the company’s inability to plug the leak sooner. The relief well is considered the best hope of halting the crude that has been gushing since April 20 in the biggest offshore oil spill in U.S. history. Meanwhile, the first tropical depression of the Atlantic season formed in the Caribbean, raising concerns about what might happen to efforts to contain the oil if bad weather forces BP to abandon them.

Burqa Bans Grow Fashionable in Europe

A growing movement in Europe to ban burqas and niqabs, the face coverings worn by some Muslim women, is igniting a debate over individual religious freedom vs. broader cultural values. The movement started in Belgium when a bill making it a crime to wear a face veil in public passed unanimously in the lower house of parliament in April. The penalty would be a $19-$31 fine or a week in jail. The measure is likely to become law by fall. France followed and lawmakers across the continent are considering similar measures. In France, which has Europe’s largest Muslim population — an estimated 7%-10% of its 64 million people — the Cabinet approved a ban on face-covering veils in public areas in May. Lawmakers say they are not concerned about Muslims in general but about the minority who hold extremist views. Many European countries, including France, Belgium and Germany, restrict head scarves and face-covering veils for government employees and in state schools.

Devout Are Less Stressed than Non-Believers

Religion may provide a “buffer” allowing the devout to feel less anxiety when they make mistakes, compared with non-believers, according to new scientific research. Religion News Service reports that researchers at the University of Toronto measured “error-related negativity” — people’s defensive response to errors — and compared it to religious belief. In the experiments, participants had electrodes measuring their brain activity as they performed cognitive tests. They were then asked to quantify their belief in God on a scale of zero to seven. The study found that those who were religious or claimed belief in God “showed low levels of distress-related neural activity” when they learned of their test errors, compared with nonbelievers.  By contrast, atheists demonstrated a “heightened neural response” and reacted more defensively when they learned of their errors, wrote the study’s lead author, Michael Inzlicht, an associate professor of psychology at the University of Toronto.

States to Miss Health Care Deadline

Beginning Thursday, residents in most states will be able to apply for new federal health coverage for people denied insurance because of medical problems, but some of the nation’s largest states will miss the deadline, according to state insurance departments. The key early program of the nation’s new health law aims to provide affordable coverage to about 200,000 people with pre-existing medical conditions, such as cancer or diabetes, through federal high-risk insurance pools. Applications to buy the coverage will be ready Thursday for residents of about 20 states that asked HHS to run the program for them. About 30 states opted to run the programs themselves. Of those, he said about 20 will be ready to accept applications in early to mid-July. About 10 states are working through legislative and other issues that may take weeks or months to resolve. Details of the costs and coverage will be posted at http://www.healthcare.gov.

Whooping Cough Epidemic Hits California

Whooping cough is now an epidemic in California, and is on pace to break a 50-year record for infections for the year. As of June 15, California had 910 recorded cases of the highly contagious disease, and five babies — all under 3 months of age — have died from the disease this year. This year’s surge in cases of whooping cough, also known as pertussis, is a fourfold increase from the same period last year, when 219 cases were recorded. Unimmunized or incompletely immunized babies are particularly vulnerable. Three vaccines are administered for whooping cough, from 2 to 6 months of age. There is no shortage of vaccines, which are provided for free to hospitals and participating counties by the state health department.

Kellogg Recalls Four Cereals

Kellogg Co. is voluntarily recalling about 28 million boxes of Apple Jacks, Corn Pops, Froot Loops and Honey Smacks cereals because an unusual smell and flavor from the packages’ liners could make people ill, the company said Friday. Kellogg said about 20 people complained about the cereals, including five who reported nausea and vomiting. The company said the potential for serious health problems is low. Kellogg is trying to identify the substance on the liners that’s causing the problem and is offering consumers refunds in the meantime.

Economic News

Consumer spending rose slightly in May as Americans remain reluctant to open their wallets amid a slow economic recovery. The Commerce Department said Monday that consumer spending rose 0.2% last month, an improvement from April’s reading of no change. Incomes rose 0.4%, boosted by the temporary hiring of census workers.

Regulators on Friday shut down banks in Florida, Georgia and New Mexico, lifting to 86 the number of U.S. bank failures this year. The pace of bank failures far outstrips that of 2009, which was already a brisk year for shutdowns. By this time last year, regulators had closed 45 banks. The pace has accelerated as banks’ losses mount on loans made for commercial property and development.

Bank stocks shot higher Friday after an agreement on a financial regulation bill reassured investors that new rules won’t devastate financial companies’ profits. Analysts said the deal removes a huge cloud that has hovered over the financial industry for much of this year. The market seems to believe that financial companies would do well even with the new limits on their business.

Afghanistan

The Afghan government says an explosion has hit the capital Kabul in an area full of foreign embassies and government offices. The blast has struck near the Foreign Ministry on Saturday morning. There are also a number of embassies and offices of international organizations in the area. The bodies of 11 men, some beheaded, were found Friday in the southern Afghan province of Uruzgan. They were killed because the Taliban said they were spying for the government, working for the government.

Defense Secretary Robert Gates said Thursday that the United States and its allies are not “bogged down” in Afghanistan despite the delay of a planned offensive in the southern city of Kandahar. The remarks come one day after President Obama relieved the commander of allied forces in Afghanistan, Gen. Stanley McChrystal, and nominated Gen. David Petraeus to replace him. U.S. officials worked to allay concerns that the abrupt change reflects any lack of commitment on the part of the White House or flaws in its strategy.

North Korea

North Korea says it must bolster its nuclear capability to cope with “hostile” U.S. policy. The Foreign Ministry said in a statement Monday that “continuing hostile U.S. policy and its military threat” have raised the need for North Korea to bolster its “nuclear deterrent” in a new, improved manner. Tension on the Korean peninsula is running high over the March 26 sinking of a South Korean warship that Seoul and Washington blamed on North Korea. On Saturday, top world leaders at a G-8 meeting near Toronto criticized North Korea over the sinking and its nuclear program.

Kyrgyzstan

Barely two weeks after ethnic purges left many minority Uzbek communities in smoldering ruin, nearly two-thirds of Kyrgyzstan‘s voters went to the polls Sunday to peacefully and overwhelmingly approve a new constitution they hoped would bring stability to the Central Asian nation. Kyrgyzstan’s interim government had pressed on with the vote even though many of the 400,000 ethnic Uzbeks forced to flee have yet to return to their homes and neighborhoods. The result gave legitimacy to the provisional government backed by most Uzbeks, though some of those displaced by violence were unable to vote Sunday. The vote — supported by the U.N., the U.S. and Russia— is seen as an important step on the road to democracy for the interim government, which came to power after former President Kurmanbek Bakiyev was ousted in April following deadly street protests.

Germany

Germany’s Supreme Court has issued a landmark ruling that an assisted suicide can not be punished if it is carried out based on a patient’s prior request. The court on Thursday acquitted a lawyer who had counseled his client in 2007 to cut the tube feeding her mother, who had been in a non-responsive coma for five years. A lower court had handed the lawyer a nine-month suspended sentence. The high court said the then 71-year-old woman had expressed the wish not to be kept alive under such circumstances in 2002 before falling into the coma.

Weather

Alex strengthened back into a tropical storm as it moved across the Gulf of Mexico late Sunday after dumping heavy rains on parts of Central America and Mexico’s Yucatan Peninsula that left four people dead. Alex, with maximum sustained winds of 45 mph (75 kph), was headed on a path that would take it to Mexico’s eastern coast around midweek. Its route was still well clear of the massive oil spill in the Gulf. The National Hurricane Center said the storm will strengthen further over the warm waters of the Gulf of Mexico and could become a hurricane within 48 hours. Alex made landfall on the coast of Belize late Saturday as a tropical storm but weakened into a depression as it passed over land across the Yucatan Peninsula. The heavy rains prompted a landslide in northwestern Guatemala that dislodged a large rock outcropping, killing two men who had taken shelter from the storm underneath. In El Salvador, two people were swept away by rivers that jumped their banks. About 500 people were evacuated from their homes.

Severe storms and strong winds overturned trailers at an eastern Michigan campground Sunday, killing one person and injuring four others The National Weather Service had issued multiple tornado and severe thunderstorm warnings across the southern part of the state and authorities in other areas had reported what appeared to be twisters. Several camping trailers were blown over and about 15 to 20 were damaged. One landed in a pond on the campground.

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