A TEXT POST

The Amanda Knox lottery


By Alessandro Bianchi On my mind was the number 77; the number of my press badge and the number I gave to police to get through security at the entrance to the court house. Within a few minutes, the stepladders of photographers and television crews formed a pyramid that could block your view if you had chosen the wrong place. It was like a lottery and you had to wait to see if you had picked the right number. The day before the verdict in the Amanda Knox appeal trial there were so many of us that the public, almost as if we were part of a show, pulled on our shirts and moved our ladders so they could see. The public were, after all, invading our 15 minutes, our sacred 15 minutes. Throughout the trial, from afternoon to late night the lawyers could be seen in the center of the city, so during the four years we were able to establish a relationship with them and talk about our news organization, which may not necessarily be known by everyone in the Italian provinces. We used these contacts later to reach an agreement with the president of the court to work out a pool system (sharing of images between agreed agencies) for the reading of the appeals verdict. The unique aspect of this experience was the atmosphere of a medieval city, one often covered by fog during cold winters and populated year-round by foreign students who walked with books during the day and filled the pubs at night. Inevitably, I had my own ideas and opinions about the relationship between Raffaele and Amanda and what really happened during this murder, which still remains a mystery. Even for someone like me, who is physically imposing and no stranger to covering violent crimes, the whole atmosphere left me in a strange state of fear and unease. Now that the story is over, my “war” to get good pictures has ended. It ended well overall for me — even though I still can feel the sting of a lost battle or two.

A TEXT POST

UPDATE 1-Zynga shares to trade as ZNGA on Nasdaq


NEW YORK, Oct 13 (Reuters) - The social games maker Zynga has chosen to list its shares on the Nasdaq exchange under the symbol “ZNGA,” the company said in a filing on Thursday.The company on July 1 filed for an initial public offering of up to $1 billion, but Zynga declined on Thursday to comment further on the IPO.The company also said its top three revenue generating games for the six months ended June 30, 2011 were Mafia Wars, FarmVille and Zynga Poker.Those three games are 59 percent of online game revenue. A year earlier, those games accounted for 84 percent of revenue so the drop shows the company is able to generate revenue from a wider range of games.The company had previously said that its revenue increased by $271.5 million in the first half of 2011 compared to a year earlier. The company for the first time broke out how three of its games helped drive that increase.FarmVille accounted for $76.6 million of the revenue increase, while FrontierVille’s accounted for $70.5 million of the increase. CityVille, which launched in December 2010, generated $46.6 million in revenue in those six months.The rest of Zynga’s games accounted for the remaining $77.8 million of the revenue increase, the company said.The filing comes two days after the company unveiled a crop of new games and a new gaming service at a rare media event in San Francisco.At the event, Chief Executive Mark Pincus steered clear of discussing the IPO, but Zynga’s first-ever large media presentation was a signal to analysts the company is taking Wall Street seriously and on track to go public.

A TEXT POST

UPDATE 1-Zynga shares to trade as ZNGA on Nasdaq


NEW YORK, Oct 13 (Reuters) - The social games maker Zynga has chosen to list its shares on the Nasdaq exchange under the symbol “ZNGA,” the company said in a filing on Thursday.The company on July 1 filed for an initial public offering of up to $1 billion, but Zynga declined on Thursday to comment further on the IPO.The company also said its top three revenue generating games for the six months ended June 30, 2011 were Mafia Wars, FarmVille and Zynga Poker.Those three games are 59 percent of online game revenue. A year earlier, those games accounted for 84 percent of revenue so the drop shows the company is able to generate revenue from a wider range of games.The company had previously said that its revenue increased by $271.5 million in the first half of 2011 compared to a year earlier. The company for the first time broke out how three of its games helped drive that increase.FarmVille accounted for $76.6 million of the revenue increase, while FrontierVille’s accounted for $70.5 million of the increase. CityVille, which launched in December 2010, generated $46.6 million in revenue in those six months.The rest of Zynga’s games accounted for the remaining $77.8 million of the revenue increase, the company said.The filing comes two days after the company unveiled a crop of new games and a new gaming service at a rare media event in San Francisco.At the event, Chief Executive Mark Pincus steered clear of discussing the IPO, but Zynga’s first-ever large media presentation was a signal to analysts the company is taking Wall Street seriously and on track to go public.

A TEXT POST

WRAPUP 1-BlackBerry co-CEOs seek to control the damage


* Says full service back, but cause still unknownBy Alastair SharpTORONTO, Oct 13 (Reuters) - Research In Motion has fixed the root cause of a global disruption of BlackBerry services and is still working to clear a backlog of delayed messages, its co-CEOs said on Thursday, hoping to control the damage to RIM four days after the outage began.The chief executives - Mike Lazaridis and Jim Balsillie - apologized for the system-wide failure that left millions of BlackBerry users without email, instant messaging and browsing and said the company would work to regain their customers trust.”Our inability to quickly fix this has been frustrating,” Lazaridis said, sounding contrite. “We are taking immediate and aggressive steps to minimize risk of this happening again.”Asked about whether RIM would pay compensation to carriers or enterprises that pay a monthly fee for its gold-standard messaging services, Balsillie suggested the company would consider that question in the coming days.”Our focus has been 100 percent on getting the systems up and running. … That’s been our focus throughout the night and we have SLAs (service level agreements) with customers and that’s something we’re going to focus on now.”A number of network providers around the world have already said they would compensate their customers over the lost service.The outage - and RIM’s sluggish communications with its customers - have fanned rising dissatisfaction with Lazaridis and Balsillie, who made an unusual joint appearance on the conference call.Even before the latest outage, critics have called for a shake-up at RIM, saying the top managers have let the company fall too far behind Apple and other rivals in a rapidly changing market.The session was only the second call that RIM has held since the crisis began on Monday.Earlier on Thursday the company posted a video clip of Lazaridis apologizing for the incident. He repeated that message in his opening remarks at Thursday’s conference call.Public relations specialists have wondered why it took the company so long, saying its response to the crisis has been slow and poorly communicated.”I think a statement of empathy that wouldn’t cost anybody anything could have been made within hours,” said Allan Bonner, a leading public relations crisis management consultant in Toronto.”They’re doing crisis response the way they’re designing their software these days — it’s outdated, slow and not being well-received by their customers,” said Gene Grabowski, senior vice president at Levick Strategic Communications.FULL SERVICE RESTORED, RIM SAYSThe Waterloo, Ontario-based company said it had restored full service, even as it acknowledged that the backlog caused by the outage was still working its way through system.It said it determined that the outage - the most extensive in the company’s history - was caused by a malfunctioning switch at a data center in Slough, England, and the subsequent failure of a backup to operate properly.That triggered a massive reservoir of data that jammed up other data centers, spreading the disruption to most regions.Lazaridis said it would take some time to pinpoint why the switch and back-up both failed, setting off the crisis.

A TEXT POST

New Issue-Standard Chartered prices 1.25 bln euro 2016 bond


Borrower Standard Chartered Bank PLCIssue Amount 1.25 billion euroMaturity Date October 20, 2016Coupon 3.875 pctReoffer price 99.621Yield 3.96 pctSpread 188 basis pointsUnderlying govt bond Over Mid-swaps, equivalent to 264.8bpOver the OBLPayment Date October 20, 2011Lead Manager(s) Deutsche Bank, Goldman Sachs International,JP Morgan & Standard Chartered BankRatings A2 (Moody’s)Listing LondonFull fees UndisclosedDenoms (K) 100-1Security details and RIC, when available, will beonCustomers can right-click on the code forperformance analysis of this new issue

A TEXT POST

Refund would not save US Postal Service-GAO


* GAO says refund could endanger federal worker benefitsBy Emily StephensonWASHINGTON, Oct 13 (Reuters) - Returning up to $75 billion the U.S. Postal Service believes it overpaid into a federal pension fund would not solve the agency’s long-term financial problems and would force the government to pay billions more for worker pensions, the Government Accountability Office said on Thursday.The Postal Service has recently lost billions of dollars each quarter as consumers use email and pay bills online.The agency is trying to cut costs, looking at closing thousands of post offices and asking Congress for permission to end Saturday delivery.A refund would “provide some temporary relief from the pressures USPS faces due to declining volume, revenue and inflexible costs, but would not by itself address USPS’s long-term financial outlook,” the GAO said in its report.The government watchdog said it did not believe the Postal Service could cut costs fast enough for a transfer of funds from the pension fund to cover the agency’s debt and address current and future operating losses.The overpayment controversy stems from the 1970s, when the Postal Service was formed as an independent agency. The USPS and the U.S. Treasury Department agreed on a method for sharing workers’ pension costs, but the Postal Service has since argued its share of the payments was too large.The agency hoped the return of money from the Civil Service Retirement System would solve its financial problems long enough to allow it to cut costs and return to profitability.A consulting firm determined in a 2010 study for the Postal Regulatory Commission that, while the allocation of pension funds was legal, it did not match current actuarial practices.Postal worker unions have pushed for the refund in hopes it would prevent the agency from moving forward on a proposal to eliminate 220,000 jobs by 2015.The refund idea is featured prominently in postal overhaul bills offered by Democrats in Congress. Senate staffers have said lawmakers were waiting to see the report before acting on postal legislation.Republicans including Darrell Issa, whose House of Representatives committee will debate his postal bill on Thursday, have said a refund could increase federal government liabilities for workers’ pensions.GAO said transferring billions of dollars away from the fund would leave the government on the hook for between $55 and $85 billion dollars and could lead to pressure to cut pension benefits for federal workers.”The disagreement among the experts over the Civil Service Retirement System overpayment is significant enough that I believe it would be more prudent to set aside this question…to focus on the areas of postal reform where we have more consensus,” Senator Tom Carper, a Democrat, said in a statement.

A TEXT POST

UPDATE 1-Irish banks must tackle mortgage arrears: c.bank


By Padraic HalpinDUBLIN, Oct 13 (Reuters) - Ireland’s banks need to accelerate their efforts to deal with the problem of mortgage arrears and have sufficient capital to write off losses on unsustainable home loans, the country’s central bank governor said on Thursday.Around 32,000 households are in arrears for more than six months on their mortgages after a devastating property crash and the problem, which is growing, is preventing a recovery in the banks, the domestic economy and the real estate market.”To date banks have restructured relatively few loans,” Patrick Honohan told a conference on the mortgage market. “It’s clearly time for the banks to ramp up their efforts in dealing with truly unsustainable situations.”“Enough capital has been injected into banks to absorb what I call unavoidable losses from unsustainable mortgages. Inefficiency of capital cannot be a reason to delay action.”The government, which has a direct exposure to the arrears problem after taking over large parts of the banking sector, published recommendations for dealing with arrears on Wednesday that could see thousands of indebted borrowers lose ownership of their homes and rent the properties instead.The state ruled out a blanket debt or negative equity forgiveness scheme, at an estimated cost of around 14 billion euros, which would have heaped further losses onto the banks’ balance sheets and be far too expensive for the state.Honohan said it was crucial that banks and the state were able to distinguish between borrowers who cannot pay and those who will not.”Making that triage between the truly unsustainable situation and the can but won’t pay is one of the key operational challenges for banks and other public authorities going forward.”

A TEXT POST

UPDATE 2-S.Korea’s Lee touts US trade pact as good for world


* North Korea talks seen unpromising but necessary (Adds Obama’s dinner with Lee)By Paul EckertWASHINGTON, Oct 12 (Reuters) - South Korean President Lee Myung-bak on Wednesday held up his country’s free trade deal with the United States as the best answer to the global economic crisis and a boon to Koreans and Americans.Lee is in Washington this week for a state visit with President Barack Obama aimed at consummating the trade pact, which was signed in 2007 but has languished in both countries’ legislatures until it was approved by the U.S. Congress on Wednesday.The accord “is about providing opportunities to many people in both of our countries,” he told an audience of business leaders and Korea experts.Lee, who rose from poverty to the top levels of corporate Korea before becoming a politician, said the free trade deal removing most tariffs between the two economies would create nothing less than an “economic alliance” between Seoul and Washington”This economic alliance will promote free trade and send a powerful message all around the world that Korea and the United States stand united in our commitment to rejecting all forms of protectionism and that we are committed to free, open and fair trade,” he said.”History teaches us that protectionism is not the answer when you are faced with a challenge of this magnitude,” said Lee, referring to the economic slump in industrialized countries.Lee has proved a reliable and enthusiastic U.S. ally, lining up with Washington on North Korea, Afghanistan, anti-piracy efforts in Somalia and the G-20 summit aimed at stabilizing the world economy.’A GLOBAL PLAYER‘“South Korea really sort of stepped up, which is part of Lee’s agenda for Korea to be more of a global player at a time when the United States wanted to see allies like Korea stepping up,” said Korea expert Victor Cha of the Center for Strategic and International Studies in Washington.Lee’s sixth meeting with Obama since 2009 will feature a full state dinner on Thursday — following his address to a joint session of the U.S. Congress after it approved the pact.South Korea’s parliament is also debating the deal.On Wednesday, Lee and his staff joined Obama for dinner at a Korean restaurant just outside Washington.The Obama administration has said the trade pact between the two countries will create thousands of U.S. jobs and double exports to South Korea in five years. Washington hopes the deal will build momentum for a wider Trans-Pacific free trade arrangement.Lee urged U.S. and Korean executives to promote the trade deal by expanding investment and hiring — answering critics of the deal in both countries.The free trade agreement “is a very significant achievement because I know that it will create jobs and it will be beneficial not only to business community, but also to workers, small businesses and consumers,” he said.Obama and Lee will visit Detroit, home of the U.S. automobile industry and many critics of trade pact, on Friday.The two leaders will also discuss ways to re-engage with North Korea. Seoul’s ties with Pyongyang soured after Lee took office in early 2008 with a pledge to link large-scale aid to progress in U.S.-led international efforts to end North Korea’s nuclear programs.Ties between the two Koreas further deteriorated following the North’s two deadly attacks on the South last year — the sinking of a South Korean warship and the shelling of an island near their contested maritime border.The provocations by the North, which walked away from six-country nuclear negotiations and conducted its second nuclear test in 2009, helped bring Washington and Seoul closer together.

A TEXT POST

Greece in talks to ease debt burden: PM


“We are negotiating in every way to lighten this debt. This is the big negotiation and this is where the big problem lies,” Papandreou told a cabinet meeting, without providing any details.Papandreou told ministers the euro zone and the Group of 20 major economies need to provide persuasive and courageous responses to the debt crisis at summits later this month and in early November.Euro zone leaders agreed in July to give Athens 109 billion euros ($149 billion) of new official financing, together with the International Monetary Fund, to cover its funding needs until mid-2014.In addition, under a voluntary debt restructuring deal, private creditors would end up taking a loss — a “haircut” — of about 21 percent in the value of their Greek bond holdings, contributing an estimated 50 billion euros on a net basis through mid-2014.But losses for private investors on Greek debt in the second financing package for Athens are now likely to be between 30 and 50 percent, rather than the earlier agreed 21 percent, euro zone officials said on Wednesday.Papandreou, who will meet EU Council President Herman Van Rompuy in Brussels on Thursday, did not specifically refer to the “haircuts” in his speech. He said the July 21 decisions were still the benchmark on which decisions at an EU October 23 summit would be based.”Let’s hope these decisions will provide a definitive solution to the problems of the euro zone and the insecurity that has encircled Greece,” he said.($1 = 0.733 Euros)

A TEXT POST

The “end game” is in Pakistan


The United States has turned on Pakistan with such dizzying speed over the past few weeks that it is difficult to keep pace. Yet what is clear after Admiral Mike Mullen’s extraordinarily blunt statement that the Haqqani militant network is a “veritable arm” of the Inter-Services Intelligence (ISI) agency is that it now has the Pakistan army very firmly in its sights. Mullen accused the ISI, which is effectively a wing of the Pakistan army, of supporting the Haqqani network in a truck bomb attack on a U.S. base in Afghanistan and an assault on the U.S. embassy in Kabul which led to a 20-hour siege. “We also have credible intelligence that they (the Haqqani network) were behind the June 28 attack against the Inter-Continental Hotel in Kabul and a host of other smaller but effective operations,” he said. It was the most forthright assertion yet by the Americans that the Pakistani military is not merely turning a blind eye to militant groups based on its border with Afghanistan but actively encouraging them to attack American interests.  The Pakistan army says it is overstretched as it is tackling militant groups which target Pakistan without creating new enemies by attacking Afghan militants and denies it retains links with the Haqqani network. Just one month ago in a report titled “Pakistan, the United States and the End Game in Afghanistan”  a group describing themselves as “the foreign policy elite” laid out what Pakistan wanted to happen in Afghanistan.  Among their suggestions were that both the Afghan Taliban led by Mullah Mohammed Omar and the Haqqani network be included in talks on a political settlement in Afghanistan.  The report was heavily criticised by those who saw it as  an attempt by Pakistan to maintain its old policy of “strategic depth” – using militant proxies to stamp its influence on Afghanistan and counter India. It looks like the United States is having none of it. I dislike the expression “end-game” applied to either Afghanistan or Pakistan (or Britain for that matter) with its implication that the people living in those countries come to an end when outside powers lose interest.  But it is worth considering the expression just to show how much has changed. The so-called “end-game” is  now in Pakistan. That is not to say there are not worsening problems in Afghanistan itself, especially with the assassination of peace council chairman Burhanuddin Rabbani “laying open again the fracture lines” of civil war, as Kate Clark wrote at the Afghanistan Analysts Network. Nor is to suggest that anyone disputes the need for a political settlement in Afghanistan. Nor indeed that American tactics and strategy in Afghanistan are not open to criticism – Pakistan repeatedly says it is being used as a scapegoat for U.S. failures in Afghanistan. And nor would it be fair to dismiss Pakistan’s own concerns that by going after the Haqqani network – with its links to the Tehrik-e-Taliban Pakistan and other militant groups – it would face even greater violence on its own soil. Those  are all subjects which merit separate and serious discussion. But it is to say that the particular end-game going on now is between the United States and the Pakistan army.  Look closely at the proposition being made by Washington.  According to Mullen’s testimony  Pakistan – and specifically its army – must give up support for the Afghan Taliban (the so-called Quetta shura Taliban) and the Haqqani network.  In return the United States will help Pakistan find “an increasing role for democratic, civilian institutions and civil society in determining Pakistan’s fate.” Whatever language you couch that in, that is quite a difficult proposition for the Pakistan army. First it is being asked to turn on old militant proxies which for decades it saw as its main leverage against both India and a hostile Afghanistan and which for the ISI in particular were a considerable source of power. Second the army – an institution which is used to being the most powerful in Pakistan – is being asked to relinquish its dominance and cede its place to a civilian democracy.  Third, even if it were willing to give up some of its power – and the considerable economic advantages  that go with it – it would need to make a leap of faith that Pakistan’s warring and often corrupt politicians could get their act together to govern the country effectively. Yet the message that appears to be being delivered by the Americans with increasing force is that if it resists, it will lose.  Unlike during the Cold War when Pakistan was able to exploit U.S.-Soviet rivalry to maintain its position against India, Pakistan is looking very isolated right now.  In the anti-Soviet jihad in Afghanistan in the 1980s it had American and Saudi support.  This time around it is hard to find any country which will help it. In Afghanistan ordinary people are opening blaming the ISI for the country’s troubles. Russia is worried about instability in Afghanistan spilling over into the former Soviet Central Asia and about drug smuggling pushing up the numbers of heroin addicts whose growth is already gnawing away at its economy. Moscow has been more resistant even than the United States to the idea of taking former Taliban off a UN sanctions list to create a better climate for talks.  Relations with neighbouring Iran tend to go up and down, but are not helped by a spate of  killings of Shi’ites by Sunni extremists in Pakistan. China is interested only in stability and securing its access through Pakistan to oil supplies and raw materials. For all Pakistan’s “deeper than the oceans”  faith in Chinese friendship, it is unlikely to ride to its rescue in a confrontation with the United States over Afghanistan. Ironically, India is being projected as a way out of the quagmire with the prospect of regional trade offered as a solution to Pakistan’s deepening economic gloom. But India – indeed far more than the United States – has tended to be more suspicious of the Pakistan military and the government has justified to its domestic critics the  current peace process as a way of supporting civilian democracy in Pakistan. So the question we need to ask is this. Will the Pakistan army fold? Institutions do not give up power easily and arguably the Pakistan army as an institution is more powerful than the individuals who lead it. In many ways this is like a rerun of the Kargil war writ large. In 1999, the Pakistan army occupied mountain positions in the Kargil region on the Line of Control separating the Indian and Pakistani parts of the former kingdom of Jammu and Kashmir – its troops encroaching on part of the territory that was supposed to be under Indian control.  In doing so, it breached a 1972  agreement with India that neither side would attempt to change the Line of Control, or ceasefire line, by force.  There was in fact an underlying – though heavily contested – logic to Pakistan’s actions in Kargil. Pakistan considered India’s occupation of Siachen (in the Karakoram mountains beyond the Line of Control) in 1984 as a similar breach of the 1972 Simla agreement. Since the late 1980s – or so I have been told by one of the generals involved – it had thought about occupying the heights above Kargil as a way of training its artillery on the main road from Kashmir towards Siachen, thereby cutting off the Indian army’s supply route. Yet the Pakistan army had over-reached. It first denied that it had any troops in Kargil at all, saying that mujahideen and irregulars had moved into positions in the mountains as part of their campaign to free Indian Kashmir from what it calls Indian occupation. In an odd foreshadowing of the current situation in Afghanistan, it chose to launch its Kargil war at a time when India and Pakistan were engaged in peace talks. After a brief and bitter war with India, the Pakistan army was forced by international pressure — especially from the United States but more discreetly from China – into a humiliating retreat. This time around the Pakistan army appears to have over-reached in a way which could prove to be its undoing. It has taken on the United States – a declining but still superpower – in Afghanistan. The issue here is not really who is right or wrong but rather which country can bring the greater force to bear and the greater international leverage.  The other possibility is that the confrontation between the Pakistan army and the United States could become more and more dangerous.  But with its very public comments on the Haqqanis and the ISI, the United States has just rolled a dice that it hopes and believes is weighted in its favour.