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Showing posts from June 23, 2013

UPDATE 1-U.S. muni bond funds report $2.22 bln outflows -Lipper

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U.S. municipal bond funds reported $2.22 billion of net outflows in the week ended June 19, up from outflows of $1.6 billion in the previous week, according to data released by Lipper on Thursday. The funds have had net outflows for four straight weeks, with the latest week the biggest since mid-December. For the four weeks outflows amounted to $5.4 billion. The four-week moving average remained negative at $1.36 billion, said Lipper, a unit of Thomson Reuters. Investors pulled out of high-yield funds for a fifth consecutive week, with net outflows of nearly $850 million, which was also the highest since the week of Dec. 19. In the week ended June 12, the funds reported outflows of $657 million.   Exchange-traded muni funds saw outflows of $54 million in the latest week, up from $7 million in the prior week, according to Lipper. Meanwhile, retail investors bought 1.8 muni bonds for every one they sold in the week ended June 19, up slightly from a ratio of 1.7 the week before, acc

UPDATE 1-Greek political impasse deepens after coalition talks fail

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Greece's coalition leaders failed to agree to on how to resume state television broadcasts during their third round of talks this week, deepening a nine-day impasse that has renewed fears of political instability in the country. Prime Minister Antonis Samaras had appeared close to a compromise earlier this week with his two leftist coalition partners over the sudden closure of the ERT state broadcaster, until the three-party talks collapsed again on Thursday. The leader of the smallest party in the coalition, Fotis Kouvelis of the Democratic Left, attacked Samaras for failing to comply with a court ruling ordering ERT back on air and rejecting his proposal for a reformed broadcaster.   "No common ground was reached at the political leaders' meeting with regards to the issue of ERT," Kouvelis said. Democratic Left party officials were due to meet on Friday morning to discuss their stance on the issue, officials said. The leader of the other junior coalition partn

CORRECTED-GLOBAL MARKETS-Stocks, bonds, commodities slump on Fed comments

Global equity markets, bond prices and commodities fell sharply on Thursday in a deep selloff, a day after the Federal Reserve said the U.S. economy was growing strongly enough for it to begin slowing its unprecedented stimulus. The Fed's bond-buying program, known as quantitative easing, has lifted both the U.S. economy and world financial markets by pushing interest rates to historic lows. But comments by Fed Chairman Ben Bernanke on Wednesday, when he laid out a likely end to the program by next year if the economy strengthens further, brought a dose of finality to the markets. "The market has had its safety blanket taken away," said Chris Wyllie, chief investment officer at wealth manager Iveagh Ltd in London. Andrew Szczurowski, a portfolio manager at Eaton Vance in Boston, said he viewed the U.S. economy as a person lost at sea to whom Bernanke had thrown a life vest. "And now all of a sudden Bernanke is talking about poking a hole in the life vest, perha

Combative Maine governor sparks firestorm with Vaseline jab

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Maine's Republican Governor, Paul LePage, touched off a firestorm of criticism on Thursday when he made a vulgar remark about a Democratic state senator. LePage said during a television interview that Senator Troy Jackson, with whom he has sparred recently over budget issues, "claims to be for the people, but he's the first one to give it to the people without providing Vaseline."   The remarks followed LePage's promise, at an Americans for Prosperity rally in Augusta, the state capital, to veto a $6.3 billion, two-year budget. Democrats criticized LePage's unwillingness to compromise on the bipartisan budget, which last week passed with two-thirds majorities in both the Maine House and Senate. The Democratic speaker of the House of Representatives immediately blasted the remark "LePage's language today crosses a new line - even for him," House Speaker Mark Eves said. "I would not want my children to hear these vulgar comments from the

Molson Coors Canada wins injunction in tussle with Miller

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The Ontario Superior Court on Thursday granted Molson Coors a temporary injunction that prevents Miller Brewing Co from ending a license agreement with Molson's Canadian arm before a trial scheduled for December. _0"> In February, Miller, a subsidiary of SABMiller Plc, had announced that it planned to end the deal with Molson Coors Canadian arm as it believed its partner was not doing enough to promote Miller brands in Canada. Molson Coors in turn filed a lawsuit seeking to prevent the termination of the license agreement. Miller had provided Molson with a notice of termination in January, and it had been aiming to end the agreement on July 22.   Miller said on Thursday it was disappointed with the court's decision, but said it remains confident in its position ahead of the trial. A spokesman for Molson was not immediately reachable for comment. "We remain firm in our expectation that the Court will agree that we adhered to the terms of our Canadian license

Greek PM calls on junior partner to back him after talks collapse

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Greek Prime Minister Antonis Samaras on Friday called on the small Democratic Left party in his ruling coalition to back him after talks to resume state television broadcasts collapsed, leaving the government in disarray. _0"> Samaras said he had compromised by offering to re-hire 2,000 out of the 2,600 ERT workers who were fired when it was yanked off air last week, which was accepted by the Socialist PASOK party but rejected by the Democratic Left.   "I want us to continue together as we started but I will move on either way," Samaras said in a televised statement. "Our aim is to conclude our effort to save the country, always with a four-year term in the horizon. We hope for the Democratic Left's support."

UPDATE 4-Barry weakens to depression, moving inland into Mexico

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The Mexican state of Veracruz was hit by heavy rains on Thursday after Tropical Storm Barry moved away from Mexico's major oil installations and weakened to a Tropical Depression. Only one of Mexico's three major oil-exporting ports - Dos Bocas - remained closed, but state oil monopoly Pemex said it was unaffected by the storm. Almost all of Mexico's crude oil exports, which totaled 1.275 million barrels per day (bpd) in April, are shipped to refineries on the Gulf Coast of the United States from the ports of Coatzacoalcos, Dos Bocas and Cayo Arcas.   The rains falling in the town of Actopan in Veracruz were more severe than those during Hurricane Karl, a Category 3 storm that battered the state in 2010, said town spokesman Rafael Alberto Moreno. There is a risk that the Actopan River, one of the biggest in the state, might overflow and townspeople were being evacuated from their homes, he said. Barry is expected to lose strength during the course of Thursday, and th

Greek coalition party to decide whether to back government-sources

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Greece's Democratic Left, the smallest party in the ruling coalition, will decide on Friday whether to continue in the government after a row over the closure of state broadcaster ERT, two party officials said on Friday. _0"> The party's lawmakers will meet at 0730 GMT on Friday to discuss their position, the officials told Reuters. "The Democratic Left will decide whether it will continue to back the government or not," one official said.   Another party official, Dimitris Hatzisokratis, said it was not the party's intention to push the country to early elections.

UPDATE 4-Bank of Tokyo-Mitsubishi to pay N.Y. $250 mln for wire violations

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The Bank of Tokyo-Mitsubishi UFJ has agreed to pay New York state $250 million for deleting information from $100 billion in wire transfers that authorities could have used to police transactions with sanctioned countries like Iran . The settlement, announced on Thursday, is the latest example of New York state's chief financial regulator, Benjamin Lawsky, flexing the agency's muscle. Lawsky extracted a much bigger sum than the U.S. Treasury Department, which settled with the bank over sanctions violations in December 2012 for $8.57 million.   Lawsky has gone his own way before, drawing criticism from other regulators. Last year, when a group of government authorities were investigating Standard Chartered Plc, the New York regulator threatened to revoke the bank's state license, and stopped working with other agencies. In August, Standard Chartered agreed to pay the state $340 million over transactions linked to Iran and other countries. Four months later, the bank set

EU to decide who pays when banks fail

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The European Union will seek on Friday to forge rules to force losses on large savers when banks fail, a sensitive reform that could shape how the euro zone deals with its sickly banks. Finance ministers in Luxembourg will try to resolve one of the most difficult questions posed by Europe's banking crisis - how to shut failed banks without sowing panic or burdening taxpayers.   "The costs of future restructurings can't be wished away," said a senior EU official involved in the talks. "We need a mechanism to shift the burden away from taxpayers." The European Union spent the equivalent of a third of its economic output on saving its banks between 2008 and 2011, plundering taxpayer cash but struggling to contain the crisis and in the case of Ireland , almost bankrupting the country. But France and Germany are divided over how strict the new rules should be, with Paris worried that imposing losses on depositors could prompt a bank run. A draft EU law th

UPDATE 1-Greece to avoid funding problems if it delivers on bailout program-IMF

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The International Monetary Fund on Thursday urged Greece to speedily deliver on its bailout program, adding that doing so would ensure the country encounters "no financing problems." There is an ongoing review of the Greek bailout program, the IMF said on Thursday. "If the review is concluded by the end of July, as expected, no financing problems will arise because the program is financed till end-July 2014," IMF spokesman Gerry Rice said in a brief statement.   The Financial Times reported on Thursday the IMF might suspend aid to Greece next month unless euro zone leaders plugged a funding gap in the Greek rescue program. Reuters reported on Wednesday that European foot-dragging could leave Greece some 2 billion euros ($2.7 billion) short this year as some euro zone creditors were reluctant to roll over their Greek debt holdings. Greece's creditors - euro zone countries, the European Central Bank and the International Monetary Fund - agreed last Decembe

UPDATE 1-U.S. senator says Booz Allen hired convict for classified job

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Senator Bill Nelson said contractor Booz Allen Hamilton had hired an employee convicted of lying to the U.S. government for a position in which he would handle classified documents. Nelson, a Florida Democrat, called on the Senate Intelligence Committee to conduct an investigation broadly into how contractors are handling employees with top secret clearance. He said he is alarmed by the combination of this incident and the more recent revelation that a National Security Agency contractor who worked for Booz Allen Hamilton leaked sensitive government documents.   Nelson, in a letter to Senate Intelligence Chair Dianne Feinstein, said these incidents merit a probe "to determine more broadly how private contractors are managing the hiring and monitoring of employees who have top secret clearance from the government." A spokesman for Booz Allen Hamilton declined to comment. Nelson said he was reminded earlier this week of a situation in which Booz Allen Hamilton hired a man

S.Korean shipper STX Pan Ocean seeks protection from US creditors

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The bulk shipper STX Pan Ocean Co Ltd filed for protection under U.S. bankruptcy law on Thursday to shield its assets from creditors in the United States, less than two weeks after filing for court receivership in South Korea . _0"> STX sought protection under Chapter 15 under the U.S. bankruptcy code with the federal bankruptcy court in Manhattan. The company had previously said it needed protection because it faced "a liquidity crunch" that left it unable to obtain sufficient funds to repay its debt, which recently totaled about 5.51 trillion won (now US$4.81 billion).   In Thursday's filing, two court-appointed administrators for STX said the company has struggled with a shrinking profit margin amid a decline in the value of dry bulk shipping contracts. They said STX has several long-term contracts that will prove profitable and around which it intends to reorganize. The filing seeks recognition of the Korean proceeding as a "foreign main proceeding

UPDATE 2-Greek coalition in disarray, small party considers quitting

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Greece's small Democratic Left party could pull out of Prime Minister Antonis Samaras's ruling coalition after talks to resume state television broadcasts collapsed, party officials said on Thursday, plunging the nation into fresh turmoil.   Lawmakers from the leftist party - which was angered by the abrupt shutdown of broadcaster ERT last week - will meet at 0730 GMT on Friday to decide whether to continue backing Samaras, who in turn warned he was ready to press ahead without them. "I want us to continue together as we started but I will move on either way," Samaras said in a televised statement, vowing to implement public sector reforms demanded by lenders. "Our aim is to conclude our effort to save the country, always with a four-year term in our sights. We hope for the Democratic Left's support." Samaras's New Democracy party and its Socialist PASOK ally jointly have 153 deputies, a majority of three in the country's 300-member parliam

PRESS DIGEST-New York Times business news - June 20

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The following are the top stories on the New York Times business pages. Reuters has not verified these stories and does not vouch for their accuracy. _0"> * The possibility of a bankruptcy filing by the city of Detroit has raised concerns about the fate of 62 classic cars managed by the city's historical society. () * The U.S. Federal Reserve, increasingly confident in the durability of economic growth, expects to start pulling back later this year from its efforts to stimulate the economy, the Fed Chairman, Ben Bernanke, said on Wednesday. ()   * Europe's top antitrust enforcer continued a crackdown on drug company efforts to keep low-cost generic versions of their medicines off the market, a campaign that is taking place on both sides of the Atlantic. () * George Zimmer, the founder of Men's Wearhouse Inc and a frequent presence in its commercials, was fired on the day of its shareholders' meeting. A disagreement between Mr. Zimmer and the board ap

FCC's Alpine Germany files for insolvency

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The German unit of FCC's Alpine Bau has filed for insolvency, following a similar move by its Austrian parent construction company on Wednesday. _0"> Alpine Bau Deutschland has operations in the Netherlands, Poland, Russia and the United Arab Emirates as well as Germany , and employs 1,500 people. It had sales of around 600 million euros ($804 million) in 2012. "We have a clear goal of cleaning up Alpine. The insolvency proceedings... are an appropriate way to create the necessary basis for a future of the company," Alpine Bau Deutschland Chief Executive Frank Jainz said in a statement late on Wednesday.   The company said it was looking for a new investor. ($1 = 0.7461 euros) (Reporting by Georgina Prodhan; editing by Patrick Graham)

Lehman Europe creditors to get further $5.5 bln payout

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More than 1,000 creditors of the European operations of failed U.S. investment bank Lehman Brothers will share a 3.5 billion pound ($5.5 billion) payout next week, its administrators said on Thursday. _0"> The payout means the recovery so far for creditors from one of the banking collapses at the heart of the 2008 financial crisis is 68.5 cents in the dollar.   PricewaterhouseCoopers, joint administrators for Lehman Brothers International (Europe), said a dividend of 43.3 percent of what creditors were owed - the second so far - would be paid on June 28. The administrators for what is the biggest bankruptcy in history said in their last progress report in April that unsecured creditors could be paid in full and there could be surplus funds. Tony Lomas, lead administrator of LBIE and partner at PwC, said the latest payout followed resolution of a number of multi-billion pound disputes with affiliates and a reduction in creditor claims reserves through settlements with majo

Kodak strikes post-bankruptcy loan deal with banks

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Eastman Kodak Co said on Thursday that it had reached a $895 million financing deal with three Wall Street banks that will help fund its rebirth as commercial imaging business after the former film pioneer emerges from bankruptcy. _0"> Affiliates of JPMorgan Chase & Co, Bank of America Corp and Barclays Plc will be joint lead arrangers for a senior secured term loan package of $695 million. The three banks will also arrange an asset-based revolving credit facility of $200 million.   Kodak will use the money to pay off loans that funded its bankruptcy as well as for working capital once it exits bankruptcy, which is expected later this year. The loan agreement is contingent on approval from the U.S. Bankruptcy Court in Manhattan, which is overseeing the Chapter 11 reorganization of Rochester, New York-based Kodak. On Wednesday Kodak said it would seek court approval for a $406 million rights offering, selling 34 million shares, or 85 percent of the equity in the reorga

Builder Porr delays bond after Alpine insolvency

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Austrian construction group Porr has abandoned for now a 150 million euro ($201 million) bond issue planned for the start of July after peer Alpine filed for insolvency, Chief Executive Karl-Heinz Strauss said on Thursday. The move by Alpine Bau, the Austrian construction unit of Spanish group FCC, meant Porr would not now be able to sell the bond at the interest rate it wanted, he told Reuters in an interview.   "We have postponed our bond plan indefinitely," he said. "Alpine's insolvency offers both risks and opportunities," Strauss said, reiterating his company could buy parts of its ailing rival and take on 3,000 to 4,000 workers in Austria. He said he had no interest in Alpine's foreign business, saying it had too many "legacy burdens". Alpine Bau GmbH, Austria's second-biggest construction firm, filed for insolvency on Wednesday with liabilities of up to 2.6 billion euros in what could become the country's biggest corporate col

Saab parent to appeal dismissal of $3 bln lawsuit vs GM

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Dutch sports car maker Spyker NV said on Thursday it will appeal a U.S. judge's decision to dismiss its $3 billion lawsuit accusing General Motors Co of trying to bankrupt Swedish automaker Saab. _0"> Spyker, which now owns Saab, said in a statement posted on the company's website that it would appeal the decision following a "careful review" of the court's opinion. No further details were disclosed and Spyker Chief Executive Victor Muller was not immediately available to comment.   U.S. District Court Judge Gershwin Drain said on June 10, in tossing the lawsuit, that GM had a contractual right to approve or disapprove the proposed sale of Saab to China's Zhejiang Youngman Lotus Automobile Co. Saab, one of Sweden's best-known brands, stopped production in May 2011 when it could no longer pay suppliers and employees. It went bust in December 2011, less than two years after GM sold it to Spyker. Spyker sued GM in August 2012, seeking damages an

Detroit emergency manager launches pension corruption probe

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Detroit Emergency Manager Kevyn Orr is ordering a joint investigation into the city's two pension funds, in search of evidence of suspected fraud, corruption, waste and other possible malfeasance. Orr, a restructuring attorney appointed to reduce the city's runaway debt, signed an order on Thursday that calls for the city's auditor general and inspector general to investigate the funds, which handle pension benefits for more than 20,000 retirees.   "There have been many questionable investments that have been made by the fund boards, and some of those investments were made without the advice of their financial adviser," Orr's spokesman, Bill Nowling, said on Thursday. "We want to find out what happened." Orr called for a preliminary report to be issued within the next 60 days. "The EM believes that any such waste, fraud, abuse, or corruption in the administration operation or implementation of Benefit Programs harms the City and its reside

UPDATE 3-Madoff trustee cannot sue big banks, U.S. court rules

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The trustee seeking money for Bernard Madoff's victims suffered a big defeat as a federal appeals court rejected his bid to recover nearly $30 billion from JPMorgan Chase & Co. and other banks he accused of aiding in the swindler's fraud.   The 2nd U.S. Circuit Court of Appeals in New York said on Thursday trustee Irving Picard lacked standing to pursue a variety of claims on behalf of former Madoff customers. It also said that because Picard "stands in the shoes" of the former Bernard L. Madoff Investment Securities LLC, he could not pursue other claims on behalf of the firm's bankruptcy estate over a fraud that the firm itself orchestrated. Thursday's 3-0 decision, written by Chief Judge Dennis Jacobs, is a victory for JPMorgan, which had been Madoff's main bank, as well as Britain's HSBC Holdings Plc, Italy's UniCredit SpA and Switzerland's UBS AG . Unless Picard successfully appeals, it also limits how much he will have to distrib

Blackstone settles Extended Stay lawsuit for $10 mln

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Blackstone Group LP agreed to pay $10 million to settle a lawsuit that had sought $8.4 billion for its role in the sale and subsequent bankruptcy of hotel chain Extended Stay Inc. _0"> Citigroup Inc, an adviser to the private equity firm that took control of Extended Stay in a 2007 leveraged buyout, agreed to pay $200,000, according to a filing with the U.S. Bankruptcy Court in New York on Thursday. Bank of America Corp , which advised Blackstone, was also released from the lawsuits as part of the settlement.   The lawsuits stemmed from the 2009 bankruptcy of Extended Stay Inc, which creditors blamed on a leveraged buyout of the chain two years earlier. In 2007, Blackstone sold the chain of about 680 hotels for $8 billion to a little-known private equity investor, David Lichtenstein. The settlement excluded Lichtenstein. After Extended Stay filed for bankruptcy, a trustee acting for the benefit of its creditors filed five lawsuits in 2011. The lawsuits alleged that Black

Britons freed, Canadian jailed for 9 years in Cuban graft cases

Two British businessmen were released from custody in Cuba this week but a Canadian remained behind bars after courts delivered verdicts in two high-profile corruption trials, sources close to the cases said on Thursday. Amado Fakhre and Stephen Purvis, the top executives of British investment and trading firm Coral Capital Group Ltd, were found guilty of minor charges and released for time served, according to the sources who spoke on condition of anonymity. But Canadian businessman Sarkis Yacoubian, originally from Armenia and the owner of import firm Tri-Star Caribbean, and his cousin and associate, Lebanese citizen Krikor Bayassalian, were found guilty of bribery and other related charges. Yacoubian, who provided evidence to the government after he was arrested and his company closed two years ago, was sentenced to nine years in prison. Bayassalian received a four-year prison term. The four were tried in two separate cases last month. Yacoubian, who along with Bayassalian i

Insurgency threat may dim Mozambique's shine for investors

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An economic take-off in Mozambique driven by bumper coal and gas discoveries two decades after the end of a civil war is facing disruption from disgruntled former guerrillas who feel they have not benefited from the post-conflict dividend. A public threat by the ex-rebel Renamo opposition party to paralyze central rail and road links has put the Frelimo government on alert and alarmed diplomats and investors.   A slide back into the kind of all-out war that crippled the former Portuguese southern African colony between 1975 and 1992 looks unlikely. Nevertheless, Mozambique's rebirth as an attractive tourism and investment destination could lose some of its momentum after armed attacks in the last two months blamed on Renamo. The raids in central Sofala province killed at least 11 soldiers and police and three civilians and came after Renamo leader Afonso Dhlakama returned with his civil war comrades to the Gorongosa jungle base where they operated in the 1980s. "It does

Liberia sends first post-war peacekeepers to Mali

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Liberia sent about 50 troops to Mali on Thursday to join the U.N. peacekeeping mission, a first for the West African nation since its 14-year civil war ended a decade ago. _0"> The 12,000-strong U.N. force, known as MINUSMA, will take over peacekeeping duties next month from an African regional mission deployed after France launched an offensive in January to drive Islamist rebels from northern Mali.   Liberian President Ellen Johnson Sirleaf, joint winner of the 2011 Nobel Peace Prize, urged the soldiers to be professional and disciplined during their mission. "You are the pride of Liberia," Sirleaf told the troops at a ceremony in the capital, Monrovia. The peacekeeping deployment is only the second in Liberia's history, after it sent peacekeepers to Democratic Republic of Congo in the 1960s. The Mali mission is the first since it rebuilt its army from scratch after the civil war, which was characterized by the use of child soldiers by rival warlords an

French government's caution on pension reform a "mistake": union chief

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President Francois Hollande's plan for a cautious reform of the pension system is not extensive enough, the head of France's largest union said on Thursday. _0"> Laurent Berger, who heads the reformist CFDT union, criticized Hollande as unions, employers and officials launched three months of talks on how to fix a pension system seen running a 20-billion-euro ($26 billion) deficit by 2020.   The debate is aimed at yielding recommendations that are non-binding for the government, but will serve as the basis for a draft law to be put before parliament in September. On Sunday, the Socialist Hollande said he wanted adjustments to the system rather than an overhaul, as he tries to ease a strain on public finances without setting off street protests. "The principles laid out by the president... are principles that should lead us toward a systemic reform of the pension system," he told journalists. "He is loath to go there. That's a mistake." The

Iran seizes two UAE fishing boats in Gulf, arrests 13

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Iran has detained 12 United Arab Emirates nationals and one Indian who were aboard two boats which crossed into what Iran claims as its territorial waters in the Gulf, the English-language Press TV reported on Thursday. _0"> "The (Iranian) forces at Abu Musa Marine Patrol Base detected two intruding UAE vessels while fishing in the Persian Gulf waters and issued the order for capturing them," Press TV quoted base commander Colonel Ali Vesali as saying.   Vesali said those arrested were transferred to a military dock, without giving further details. Political relations are strained between the two oil-rich countries which face each other across the Gulf. The three islands of Abu Musa and Greater and Lesser Tunb are claimed by both countries but have been held by Iran since 1971, shortly before the seven Gulf emirates gained full independence from Britain and formed the UAE, now allied with Washington. In May, the United Arab Emirates criticized a visit by Irani

Islamists to rally for Mursi as Egyptian tensions rise

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Islamist supporters of Egyptian President Mohamed Mursi will rally in Cairo on Friday in a show of approval for him to upstage opposition protests planned to mark his first year in office at the end of the month. Preparations for renewed street action after some months of calm have raised fears of violence of the kind that has punctuated the two-and-a-half years since Hosni Mubarak fell.   Mursi's opponents, who say at least 13 million people have signed a petition calling on him to step down, hope protests on June 30 will force him out. Their demand has angered Islamists who see it as an undemocratic bid to remove an elected leader. His allies will rally after Friday prayers in Cairo. A year after Mursi won election - with 13.2 million votes - the split between his supporters and a diverse opposition that accuses his Muslim Brotherhood of trying to Islamise the state is deeper than ever. It has fuelled political instability that is hampering Egypt's recovery from a deep