GREECE: NO WAY OUT? MARKETS SHUDDER
-THE BIG PICTURE…The equation goes like this: No government + no willingness to impose mandated budget cuts = A cutoff of bailout money + likely Greek default + almost certain exit from the euro. That sequence leads to the long-feared "contagion" - the nightmare in which the debt crisis spreads across Europe, dragging with it much more potent economies (Italy, Spain et al) and pummeling global markets and global economies along the way. Happy summer…
-TODAY IN ATHENS… Greek President Karolos Papoulias is meeting party leaders this morning to set up an emergency caretaker government - ahead of fresh elections now expected June 10th or 17th. That's because a final round of talks to secure a coalition failed on Tuesday. Meanwhile, The Wall Street Journal reports depositors withdrew a stunning $898 million from Greek banks on Monday alone. The steady outflow of deposits from Greek banks hasn't yet turned into a full-blown bank run, but economists warn a run on banks could develop if the population fears Greece's departure from the euro is imminent and that their savings would evaporate.
-EURO HITS FOUR-MONTH LOW…All the news from Athens continues to pound the markets - and the euro itself. Today the euro hit a four-month low against the dollar - to $1.27. The eurozone crisis also pushed Asian stocks lower Wednesday. Tokyo's Nikkei index dropped one percent, while Hong Kong's Hang Seng and South Korea's Kospi lost about three percent.
-US HELPS IN OFFENSIVE ON AL-QAEDA
Yemeni warplanes and troops backed by heavy artillery have waged a four-front assault against the strongholds of al-Qaida militants in the south, with U.S. troops for the first time helping direct the offensive from a nearby desert air base-turned-command center. Yemeni military officials said dozens of U.S. troops were operating from al-Annad air base, about 45 miles from the main battle zones, coordinating assaults and airstrikes and providing information to Yemeni forces.
-OBAMA ORDER GIVES TREASURY AUTHORITY TO FREEZE U.S.-BASED ASSETS…The Washington Post reports President Obama plans to issue an executive order today giving the Treasury Department authority to freeze the U.S.-based assets of anyone who "obstructs" implementation of the administration-backed political transition in Yemen. The unusual order, which administration officials said also targets U.S. citizens who engage in activity deemed to threaten Yemen's security or political stability, is the first issued for Yemen that does not directly relate to counterterrorism.
-DRAMATIC VIDEO SHOWS U.N. OBSERVERS CAUGHT IN SYRIA VIOLENCE… The U.N.'s observer mission in Syria has been caught up in a burst of violence captured on video, with a roadside bomb damaging its cars just minutes after witnesses said regime forces gunned down mourners at a funeral procession nearby. The mission confirmed its vehicles were hit by a bomb shortly after they met with Syrian rebels on Tuesday, and said there were no injuries. The U.N. says the observer team stayed overnight with rebel forces and U.N. officials hope to evacuate them today.
-SYRIAN REBELS GET INFLUX OF ARMS WITH US HELP… The Washington Post reports Syrian rebels battling the regime of President Bashar al-Assad have begun receiving significantly more and better weapons in recent weeks, an effort paid for by Persian Gulf nations and coordinated in part by the United States, according to opposition activists and U.S. and foreign officials. Obama administration officials emphasized that the U.S. is neither supplying nor funding the lethal material, which includes antitank weaponry. Instead, they said, the administration has expanded contacts with opposition military forces to provide the gulf nations with assessments of rebel credibility and command-and-control infrastructure.
RATKO MLADIC TRIAL BEGINS
Ratko Mladic has gone to trial in The Hague today, charged with masterminding atrocities in Bosnia during the 1992-95 war. Twenty years after Serbian forces unleashed their campaign, Mladic entered the international criminal court's Yugoslav war crimes tribunal as a frail 70-year-old, a far cry from the swaggering general who commanded Serb forces during a war that left 100,000 dead.
DISSIDENT CHEN MAY GET CHINA PASSPORT SOON
Blind Chinese activist Chen Guangcheng should receive a passport by May 21st that would allow him to leave for the U.S., according to Bob Fu, a Texas-based Christian aid worker who is in daily touch with him. Chen, a self-taught lawyer and prominent opponent of forced abortions under China's one-child policy, applied for a travel document on May 6. Under Chinese regulations, he should be issued a passport within 15 days of his petition, Fu said in an interview in Washington. When Chen leaves China, he will also leave family and friends behind who he says continue to suffer abuse inflicted primarily by the local government in his hometown province of Shandong. Chen is expected to travel to New York where he has been offered a visiting scholarship to study law.
PAKISTAN 'LIKELY TO ATTEND' NATO TALKS ON AFGHANISTAN
From Muhammad LILA: Pakistan's President Asif Ali Zardari is set to be at this weekend's Nato summit on Afghanistan. The Pakistani embassy in Washington told the BBC he was "likely to attend" the meeting in Chicago. Nato said Pakistan had an important role to play in its neighbor's future.
U.N.: MATERNAL DEATHS HALVED IN 20 YEARS
A new U.N. report says the global mortality rate for women giving birth has fallen by half over the past two decades. The report released today says that while there's been considerable progress, more work remains because a woman dies of pregnancy-related complications every two minutes. The World Health Organization, United Nations Children's Fund, United Nations Population Fund and the World Bank released the report.
SECRET SERVICE: A TRYST IN IRELAND?
The New York Daily News speaks to an unidentified Canadian woman who says she met one of the Secret Service agents from the Cartagena incident, Arthur Huntington, while he was in Dublin preparing for President Obama's trip there last May. He told her he was divorced and they met later in Manhattan last August for a two-day affair. (UNCONFIRMED BY ABC NEWS).
CHINA BLAMES DALAI LAMA FOR TIBET BURNINGS
From Gloria RIVIERA in Beijing: China has released a documentary titled "The Dalai clique and self-immolation violent incidents" that accuses the Dalai Lama of orchestrating the current wave of self-immolations by Tibetans. CCTV released the program globally. It features footage shot mostly by police surveillance cameras. As reported in the AP, "Mostly lone Tibetans are seen ablaze on small town roads before being blasted by security forces with fire extinguishers or covered with blankets." This marks the governments most extensive effort to blame the Dalai Lama for the 34 self-immolations by Tibetans in protest of Chinese rule that have taken place in the last 14 months. A spokesman for the government in exile says that neither the Dalai Lama nor Tibetans are inciting these acts, they are the result of Chinese policy against Tibet.
MEXICO'S ZETAS CARTEL DENIES ROLE IN MASS KILLING
Banners have appeared in northern Mexico signed by the Zetas drug cartel saying the gang was not responsible for killing 49 people whose mutilated bodies were found on a highway in a neighboring state. An employee of the prosecutors' office in San Luis Potosi state says the banners were hung from overpasses in the city of Ciudad Valles. The bodies were found Sunday in the neighboring state of Nuevo Leon with their heads, hands and feet hacked off. A slogan scrawled on a stone arch nearby read "100 percent Zetas," but it may have been there well before the bodies were dumped.
CRACKDOWNS ON "OCCUPY" PROTESTORS
-MOSCOW "CAMP" RAIDED…From Kirit RADIA in Moscow: Russian police have uprooted a protest camp in central Moscow that had become a center of opposition activity. A Moscow court on Tuesday ruled to support a lawsuit by residents of Chistoprudny boulevard to evict the activists.
-GERMAN POLICE BEGIN CLEARING FRANKFURT CAMP…Meanwhile, Frankfurt police are preparing to clear a tent-camp of about 300 Occupy protesters from near the European Central Bank. Police spokesman Manfred Vonhausen said Wednesday the protesters have been ordered to leave after a court upheld a ruling the camp was a threat to public safety.
MORE TROUBLE FOR "LEGIONARIES OF CHRIST" ORDER
From Phoebe NATANSON in Rome: More bad news for the once-powerful scandal-rocked Legionaries of Christ order: A popular American priest from the Legionaries of Christ, Father Thomas Williams, admitted to fathering a child several years ago. Reports say he is currently in Michigan with his parents recovering from skin cancer treatment. He has said he will take a year off from public ministry to decide what to do.
NIGERIAN COMMUNITY TRIES MASS MARRIAGE TO COMBAT SOCIAL ILLS
From Bazi KANANI: Muslim religious leaders in northern Nigeria hope a more secure family life will keep women from becoming destitute and their children from joining the radical Islamist group that has killed hundreds of people this year. They came up with a plan to marry 1000 widows and divorcees, starting with a radio campaign in February to find prospective suitors. This week, the first 100 couples were wed in a mass ceremony in the state of Kano. Activists tell the Guardian they are skeptical of the plan. The average marriage in Kano lasts only two years.
LADY GAGA V. THE ISLAMIC DEFENDERS FRONT
From Gloria RIVIERA again: Lady Gaga's Indonesian promoters are vowing to save her show despite warnings by the Islamic Defenders Front (FPI) that havoc will ensue if she performs. Calling Lady Gaga "the devil's messenger" who wears only a "bra and panties" the FPI Jakarta chairman told AFP, "We are ready to be thrown in jail and killed, we will do anything to stop it." In the past pop stars such as Beyonce and the Pussycat Dolls have performed more conservative versions of their shows in Indonesia and other Muslim countries. The Gaga v. FPI standoff has ignited a flurry of protests online from those who accuse Islamic hardliners of having too much power. But the Jakarta police continue to refuse authorization for the show, citing opposition from the country's top Islamic body, the National Ulema Council.
CANNES FILM FESTIVAL KICKS OFF WITH COMEDY, CHAOS
Comedy will dominate the opening of the Cannes film festival today, with Wes Anderson's child fantasy "Moonrise Kingdom" in a tussle with Sasha Baron Cohen's anarchic alter ego General Aladeen ("Dictator") for the attention of the world's media, Reuters reports. Thousands of journalists (including our Nick WATT) and movie executives are in the glamorous Riviera resort for opening day. Up next: 12 hectic days of screenings, red carpets, parties and dealmaking.