EUROZONE CRISIS

MARKETS SWOON Call it one step forward, one step back. (And that’s clearly NOT what global investors are looking for…) Euro-zone finance ministers reached a deal to provide collateral to Finland in exchange for future aid to Greece – and while Finland may not be directly important to us, their support clears one hurdle to a larger bailout. But here’s the backward step: those same finance ministers did not approve a $10.7 billion payment to Greece today, delaying the payment till late October. The delayed date of the approval reflects the high-stakes game of chicken being played: European countries and the IMF are likely to give Greece the money – for the simple reason that not doing so could unleash broader chaos – but not before they pressure Greece to make stronger internal budget cutbacks. And every day of dithering or delay sparks a fresh flight from stocks. Today European equity markets fell sharply — and U.S. stock futures dropped as well…

-ANOTHER THING TO WORRY ABOUT… Another institution you’ve never heard of is slamming stocks today: The AP reports that shares in Franco-Belgian bank Dexia suffered a second straight day of hefty selling Tuesday as investors grew increasingly worried over its ability to survive in its current form despite government promises to prop up the bank and insure every cent of its deposits. Dexia is at the forefront of investor concerns over its exposure to potentially bad debt from Europe’s most indebted countries. With the markets bracing for a Greek debt default soon, investors are concerned about what bonds Europe’s banks are holding and banks themselves have become reluctant to lend to one another. On Tuesday, the Belgian government sought to reassure Dexia clients and creditors.

KNOX TRIAL — AFTER THE VERDICTS

-COMING HOME And so, at last…the Amanda Knox case becomes (for the most part) a domestic news story. After four years in an Italian prison, Knox is on her way home. Knox and her family boarded a flight in Rome and are expected to return to Seattle later today.

-KNOX SPEAKS OUT Her first post-accquittal words come in the form of a letter to a prominent Italian-American foundation. In the letter, she writes to those “who shared my suffering and helped me survive with hope…I am forever grateful for their kind hospitality and their courageous efforts. Those who wrote to me, who defended me, who stood by me, who prayed for me. We are forever grateful. I love you, Amanda.” Phoebe NATANSON has the full letter.           

-THE VICTIM’S FAMILY Murder victim Meredith Kercher’s brother Lyle spoke for much of the family’s news conference this morning – telling reporters that the family is still trying to understand how a decision that “was so certain two years ago has been so dramatically overturned.” Kercher added that “It was a very long difficult day yesterday. Ultimately we accept the decision and respect the court – but we do find that we are left looking at this again…We are back at square one. Left wondering what truly happened.”           

-ITALIAN REACTION Phoebe NATANSON reports that nearly all the Italian papers are using a photo of Amanda Knox crying on their front page. Few print photos of co-defendant Raffaele Sollecito. Corriere della Serra’s headline reads: “Amanda and Raffaele Free,” La Repubblica: “Amanda and Raffaele Acquitted On Appeal.” La Stampa’s headline: “Amanda and Raffaele Acquitted – ‘They Did Not Kill Meredith,’” also running with an editorial titled “No Other Decision Was Possible.” Il Messaggero writes an editorial titled “An Investigation With Too Many Holes In It.” Also worth noting – the notorious British tabloid, the Daily Mail jumped the gun - publishing the headline: “Guilty: Amanda Knox Looks Stunned As Appeal Against Murder Conviction Is Rejected.” The paper made the necessary correction 30 minutes later. *Neal KARLINSKY in Seattle. 

SOMALIA EXPLOSION

The AP and our Dana HUGHES report that a car laden with explosives blew up in front of the Ministry of Education in the Somali capital Tuesday, killing at least 65 people in the largest-scale attack since the Islamist insurgent group Al-Shabaab withdrew from Mogadishu. At least 30 others were injured according to police reports.

DECEASED SCIENTIST WILL KEEP HIS NOBEL

The Nobel prize season began under a strange dark cloud Monday when it emerged that one winner of the prize for medicine had passed away days before. Nobel prize rules state that the honor cannot be awarded posthumously, but Canadian-born immunologist Ralph Steinman won the award Monday – having passed away Friday. Today the Nobel Committee said it hadn’t known that Steinman had died, and issued this statement: “The decision to award the 2011 Nobel Prize in Physiology or Medicine to the late Ralph Steinman shall remain unchanged, in keeping with the earlier announcement from the Nobel Assembly at Karolinska Institutet.” An added twist: Steinman had survived pancreatic cancer for four years thanks in part to an immunotherapy he had discovered.

NOBEL PHYSICS PRIZE – AMERICANS WIN

The Royal Swedish Academy of Sciences says American Saul Perlmutter, U.S.-Australian citizen Brian Schmidt and U.S. scientist Adam Riess share the 2011 Nobel Prize in physics. The trio were honored Tuesday “for the discovery of the accelerating expansion of the universe through observations of distant supernovae.” (And they are all alive, as far as we can tell.)

AFGHAN WAR

-TOP COMMANDER Martha RADDATZ interviewed General John Allen, the new commander of all U.S. forces in Afghanistan, and successor to General David Petraeus. Allen acknowledged he was “mad” about Pakistan’s support for men and materiel that fuel the insurgency in Afghanistan. “It makes me mad every day, but look, I’ve got to deal with what I can deal with…I have to leave for others the issue of the policy relationships.” He also argued the war remains worth fighting and spoke eloquently about the loss of soldiers — and communicating to families of the fallen.

-KARZAI IN TALKS WITH INDIA The BBC reports that Afghan President Hamid Karzai has arrived in India for talks about security and development. Karzai’s visit to Delhi follows a series of high-profile attacks in Afghanistan and deteriorating relations with Pakistan, India’s long-term rival. In a recent statement, Karzai said his government would halt talks with militants and work closely with the US, Europe and India to plan Afghanistan’s future.

-MEDICAL CARE IN AFGHANISTAN AT A CRITICAL LOW The International Committee for the Red Cross says access to medical care in some parts of Afghanistan has reached a “critically low point” because of the deteriorating security situation. In a statement released Tuesday, the ICRC said local clinics have been forced to close because of fighting, attacks on the premises and intimidation of staff. 

ARAB SPRING…

-PANETTA IN EGYPT Defense Secretary Leon Panetta is meeting with Egyptian leaders Tuesday — to discuss that country’s post-Mubarak transition to democracy, and urge the new authorities to release a U.S.-born man being held for allegedly being an Israeli spy. Egypt has accused 27-year-old Ilan Grapel of being a Mossad agent – a claim Israel denies.

-SYRIA UN RESOLUTION – WILL RUSSIA VETO? The AP reports that European nations are calling for a vote Tuesday on a U.N. resolution that would consider sanctions if the Syrian government doesn’t immediately halt its military crackdown against civilians. Diplomats said it was unclear whether Russia, which opposes even mentioning the possibility of sanctions against President Bashar Assad’s regime, will veto or abstain on the resolution. 

-PROGRESS IN TUNISIA? The New York Times takes an interesting look at Tunisia’s interim prime minister Beji Caid Essebsi, 84. Essebsi was picked because during a long career as an official of the Tunisian dictatorship he built a record of trying to change the system from within but as interim leader he found himself obliged to deal with continuous eruptions of protests demanding jobs, wages and immediate retribution against members of the former ruling elite. His approach has won him broad support but also led a few activists to compare him to the ousted dictator Zine el-Abidine Ben Ali.  

CONTRACEPTIVE USED IN AFRICA MAY DOUBLE RISE OF HIV

The New York Times flags an alarming study published today that finds the most popular contraceptive for women in eastern and southern Africa, a hormone shot given every three months, appears to double the risk the women will become infected with H.I.V.  Adding increased danger – when it is used by H.I.V.-positive women, their male partners are twice as likely to become infected than if the women had used no contraception. 

JAPAN TO GO AHEAD WITH WHALING

From Akiko FUJITA in Tokyo: The Fisheries Minister says Japan will resume whale hunting in the Antarctic ocean, less than a year after suspending operations, under pressure from environmental groups including Sea Shepherd. Michihiko Kanno said the whaling vessels have beefed up security, and will be accompanied by a patrol boat to ensure their safety. Sea Shepherd has already vowed to disrupt the operation, setting the stage for another clash on the seas. Leader Paul Watson has dubbed this year’s attack “Operation Divine Wind” (a.k.a kamikaze), and wrote on his Facebook page that “we are in for a very dramatic and adventurous three months.” In the past, Japanese whalers have used water cannons against activists, while Sea Shepherd has thrown butyric acid “stink bombs” at Japanese vessels and used long ropes to damage the propellers. The clash ended in the sinking of a Sea Shepherd boat in 2010. Japan has maintained its whale hunting is for “research” purposes. Whaling season begins in December.

FLY THE DREAMLINER — FOR $30,000?

From Akiko again: A ticket for two seats on the inaugural Boeing Dreamliner flight has apparently sold for roughly $33,000 on ebay. Split the cost by two, for a 3.5 hour flight from Tokyo to Hong Kong, and it amounts to roughly $2300 an hour! The auction was organized by All Nippon Airways, and the package includes accommodation at the Shangri-La hotel in Hong Kong. The Dreamliner’s first flight is scheduled for October 26th – from Narita airport to Hong Kong.

SAUDI MEN WILD DRIVING

In a country where women are not allowed to drive, Saudi men are entitled to showcase their sometimes wild and crazy driving skills, on the country’s roads.  Watch the results…