klein a brief rally after the central bank said it would start to buy up spanish and italian government bonds to restore confidence proved to be short lived daniel bushell is following the situation from brussels fears of a black monday are growing as stock markets across europe had stubbornly sells today the e.c.b. the european central bank made a wrists on the announcement to try and reassure people saying that it will boil it and spanish which normals to touch at the moment but chancellor merkel of germany spoil the party by saying that she wouldn't increase the e.u. bailout fund suggesting that if it's only and spain collapse if their economy goes on and that she and germany europe's largest economy won't help instead merkel is piling the pressure on the states for even more painful measures that it's only as prime minister silvio berlusconi says he'll bring forward the savage government spending cuts in italy by year now italians already furious thing will oppose those

measures so there are talk of a national strike in italy at the moment obviously worrying news there expose thing for more needs to be done for europe to recover from this crisis the italian government one point it trillion euros now that means nothing to anybody but that is bigger than the total government debt arland portugal and greece put together before the end of this year it really needs to sell bourne's debt which is equivalent to the whole of the greek government bond market in other words all of the greek debt that we've been talking about for weeks and weeks and weeks is being . italy is huge need is just too big to manage any way be rescued in the way that all their economies have so far been bailed out by the e.u. the big g. seven g. twenty groups of leading economies. held an emergency conference call to say that

they've got the situation on the control but investors are voting with their feeds here in europe and they say they just don't trust them the fact that's america's in panic off to losing its aaa credit rating and it's squeaky bum time for investors at the moment. dr stephens from frankfurt school of finance and management says conflicting opinions on leaders are contributing to market uncertainty. the market reaction is very clear it's a global don't do it as far as equity market but also as far as mark is a scam so and so we have some kind of promos in the market and kind of on surety on security of how the national bangs european central bank and also the u.s. fed will react to the market always will react to policy decisions and i think the uncertainty has come to the market because we have still different voices within the european community saying and this is the basis of the problem. is markets have

closed in the red following a rocky trading session. has more from asians third largest economy india all the markets are down here asia is reacting very strongly we're hearing strong words from chinese political leaders as well one chinese newspaper actually said the u.s. government has to realize that the good old days when it used to borrow its way out of math this is over so everyone's watching this very closely india is the third largest economy in asia and asia as a whole actually hold three trillion dollars of the united states china being the number one u.s. debt holder in japan being number two so they have a huge interest in what's going on over in the united states actually gone analysts are saying that this point in some ways benefit the asian economy because of the risk aversion that's happening so if investors actually look away from u.s.

treasury bonds they might actually want to invest more in certain factories in china but obviously we can't predict exactly what's going to happen yet but it's clearly creating a domino effect across the world and asia is going to continue to watch to see what happens. well the debt crisis in the u.s. triggered uncertainty despite a default being averted by a last minute deal in congress last week and as we're in a port my reports is the mood of the u.s. that the gun. hermansen spend more money on peace of home than war abroad. late comedian george carlin always spoke frankly about his nation the only true lasting american value that's left by an days buying things people spending money they don't have on things they don't need today country long driven by borrowing and consuming is in desperate need to cut it spending u.s. defense and security spending has remained untouchable soaking up seven hundred five billion dollars or twenty percent of federal funds every year since two

thousand and one more than one point two trillion dollars have been spent on the wars in iraq and afghanistan but now with fourteen point four trillion in the hole some economists say it's time for the u.s. to compromise world domination for domestic stability will also probably have to see significant requestion ing or questioning and downsizing of the several hundred foreign military bases we have given the size of the budget problems and the growing issues around the national debt and the debt ceiling it is fairly well assured that the budget will be caught for defense and it probably needs to be cut more than is presently proposed for the pentagon priorities may be different the department reportedly spent twenty three billion dollars on global hawk drones alone this year taxpayers are estimated to spend one hundred twenty two billion dollars on the war in afghanistan the same amount that could cover an estimated twenty five million americans with low income health care an empire costs

a lot of money because you have to spend a lot of money to defend that you have to spend a lot of money to promote it you have to have a lot of people working on various aspects of economic support for imperial adventures around the world the consequence is the money is leaving the united states going to other places not to the places in the united states that need it the most needing it most is the country's neglected infrastructure and job. that come with rebuilding according to the american society of civil engineers a quarter of america's six hundred thousand bridges are listed as deficient and nearly half of american households don't have access to public transportation ongoing federal budget cuts are expected to force thousands of post office and fire departments to close more than forty million americans on food stamps they also make sacrifices we just cut the food stamp budget by twelve billion dollars we have multiple experimental ongoing programs in the defense department each of which is

large enough to offset the food stamp costs and i think if we have forty one million people already who are dependent on government aid for food getting food to them is probably a first priority but defense secretary leon panetta is looking further afield for his priorities we are nation at war. we face a broad and growing range of security threats and challenges. that our military must be prepared to confront from terrorist networks to rogue nations that are making efforts to have two nuclear capability to dealing with rising power it's. always look at us to determine whether or not we will in fact mean to you know strong defense here and throughout the world eyes on the world all citizens face mounting struggles at home that's what the owners count on the fact that americans will probably remain willfully ignorant of the big red white and blue being jammed

up there. because the owners of this country know the truth it's called the american dream because you have to be asleep to believe marina porter r.t. new york. well it's his business to ask is keeping a close watch on the world markets this monday to me three is standing by how are russian stocks responding to the volatility well there was responding with a sharp drop actually on the r.t.s. we're seeing a nosedive of more than five percent my stocks is not far behind three point seven percent this hour so a sea of red all across the board we're seeing all blue chips the dow least three percent more on that in around fifteen minutes. all right thanks for that it will get more details from you of course like you said in just a few minutes. burned cars mashed windows and looted shops london is recovering after a weekend of street riots the unrest followed the fatal shooting of

a man by police that has seen at least thirty five police officers injured and one hundred sixty people arrested and that is in the british capital. obviously it's much less attractive to shops in the daylight and i think that's part of the one of the factors that has brought this situation much more under control this monday morning we all still hearing reports of pockets of already sort of creeps if you. ranging around particularly in the areas of brixton in south london and fields and the surrounding area in the north but mostly what's underway at the moment is a massive cleanup operation off to last night's shooting and saying at least cause have been smashed up and attacked police themselves have we're hearing reports of petrol bombs having been thrown at least if they were attacked by rocks it is far too and now i was in enfield last night where that the center of the violence

started and. ranging through the streets smashing into whatever they could attacking shopfronts particularly shop fronts with a tract of things inside it started off on saturday nights in taught and what started off as a peaceful protest outside the police station following the fatal shooting by police over a man called. about three hundred people holding a silent vigil outside the police station we're hearing reports that what's it was a member of the police attacking a seventeen year old girl with a box that quickly places around the crowd and we're hearing that that's what sparked this but these are areas that we're talking about particularly tottenham where this all sparked off it's an area of massive social privation there's a lot of. the police is relationship with the community and there has been for many many years. a huge amount of unemployment and has one of the highest used

unemployment figures. and living on benefits has become a way of life in these people some of them are literally how they live on benefits at the moment they see no time in the future in which they will have a job and be able to better themselves people do you feel ignored and neglected in these communities. reporting there and she's continuing to keep us informed of all the developments in london on the streets. our twitter feed and you can follow over at our to underscore column in her latest tweet that looters could move the market westfield shopping center is behind barricades and there are rumors that suggest oxford street tonight that of course a big shopping center lots of tourists stay with what's happening in london and here from the rest of our worldwide correspondents underscore. three years ago georgia launched an attack on the people of the small republic of south of the five day war in which georgia tried to reclaim its old territories

claimed hundreds of innocent lives. in the south of capital a city still struggling to come to terms with the loss of. attacks suddenly around midnight and the first tribes have been hand the russian piss keeping base and now what you can see behind me what's left of the base there were around two hundred fifty soldiers and they forced. the russian troops to iraq russia sent in troops to protect the republic citizens many of which were russian passport holders and we also were hiding in basements and blown out buildings over the han twenty three soldiers were killed and many injured and sound we managed to talk to they told us that they want to keep this building untouched and of the memory of what happened han meanwhile the morial service began last night or will be held throughout the day of these very many starts at eleven thirty five pm that's exactly the time when

george opened fire over the century hundreds of people came last night to light candles and to pray for those who were killed three years ago in a brief but destructive conflict many canes with a small children people were listening to the rag and they also released white balloons into the sky and the memory of what happened three years ago that will last it will follow days but hundreds were killed and. any interest in what was mostly destroyed after bowling so and of all the face of the city has changed within these years still locals are trying to restore their lives and we managed to speak to some of them who are still struggling to bring their lives back to normal . i come here almost every day i sit and talk to my son so i know i will lie next to my dear boy. for the last three years stacey has come to this cemetery where her son is burritt five days unorganised two thousand and eight

split her life into a before and after. when her son daughter a medical college graduate heard their republic's capital teen vall was under attack from georgia she rushed home to help the injured he died in her arms as they lay trapped for days on to the rubble of their apartment block that was in the georgian alterian firing line. the only thing that makes her life worth living now is her twenty year old daughter they now live together in a newly built house to rounded by families for similar tragic stories. this area where we live was specially built to those families who lost loved ones and were left with nothing in that house across the street lives of woman who lost two children and to the house opposite lives

a man who lost both his wife and his child. all these people are victims of georgia's military aggression in all those two thousand and eight when you try to retake control of the breakaway republic of south ossetia a russian peacekeeping mission in the region also came under fire nursed my abuse dive i was on duty with them and witnessed average thing that happened that night for i saw him violent fire when you know it was going to be our last night but it was still carried out this cuban mission and tried to become moscow's sound trained force meant to protect its citizens and prevent more civilian deaths within five days georgian troops had been repelled three weeks later russia recognized such as independence. the last three years have changed the face of this s.d. i new residential air where new roads jobs and have been burst and you have been built but still the conflict remains this ruins behind my back are

all that's left of the russian peacekeeping polled for those who lived through the horrors of the brief but deadly conflict the memories are still very raw. much in the question of reporting from scene vaal self-esteem. just before the anniversary to me that means raids have spoke to our city and other media about the south the setting of the conflict the president says georgia's leader of soccer city should face an international tribunals for crimes against russia and its nationals this interview is in full at our t.v. dot com. syrian forces have launched a fresh attack on anti-government protesters across the country gunfire and explosions have been reported in the cities of dare al gore and hamas more than three hundred people have been killed in the past week the bloodiest in the five month uprising against president assad's rule kuwait and saudi arabia have pulled

their ambassadors from syria adding to the international condemnation of the crackdown on protesters international relations expert professor mark allman says syrian politics are riddled with intrigue and is not everything and everything i should say is not as it seems. hard to dispute. that. is what. i want. to hold. your go. so we have also. had. rhetoric. about. the real grander. war in sort of. next hour more on the situation in syria and the arab world when our team talks to

iraq's foreign minister a look at some world news in brief for you this hour a document leaked to britain's times newspaper reveals plans for ruling libya after moammar gadhafi is deposed it could. not only gadhafi regime crumbling from within is likely to force him out but predicts mass defections from the security forces are likely the plan was drawn up by the national transitional council with the help of britain and other western nations. another nato helicopter has crashed landed in southeastern afghanistan just days after one was shot down taking the lives of thirty american and eight afghan soldiers the alliance hasn't reported any casualties in this latest incident and said the cause is under investigation there was not thought to be any enemy activity in the area at the time and all this comes amid the handover of security from foreign to afghan troops in some regions.

another shock for a nato country in afghanistan as we report in our two dot com a british soldier is under investigation for allegedly chopping the fingers off a dead taliban fighters as keepsakes also. passenger plane crashes and russia's far east but there are no free tallaght ease thanks only to a miracle says eyewitnesses we report on that find out more on this and other stories that are teed dot com. just under ten minutes away here on our to recap of our top stories after business with dimitri.

thanks in the saloon welcome to business tsotsi russian equities deeply in the red at the end of the trading day following losses in asia and europe market watchers say it's choppy a volatile after friday's american downgraded e.c.b. into. mention door to me now is not the you cannot be sales manager of producer financial corp so a lot of good to see you right now yes is down five percent my six three and a half percent how would you describe the situation. well the situation is clearing nothing short of a panic we have seen a somewhat panicky mood in the market last week and luckily we had forty eight hours to digest the s. and p. downgrade over the weekend we've seen quite volatile session this morning expectedly the market opened quite sharply down then recuperated parts part of the losses and clearly closing still lower and especially this is a bull cross the blue chip universe which is the easiest to get rid of and what we observe we have what we observe at the moment of the climb to seventy is we see

hedge funds trying to get rid of the blue chip makers and the police situations trying to pick up somebody tell you a place in the second tier universe in what is a good time to look for interesting blog an opportunity is all to stay clear and wait for another day. there is clearly going to be a balance of some sort in this market because all markets do not move in that the same direction all times the switched directions my personal view would be that it's too early to talk about just a serious bargain so even even if we are to do a little bounce at some point tomorrow next week it's still too early thing still have to get worse before they get better because they're still quite substantial problems on the table the b.b.c. b. problems the. federal reserve which we're looking at tomorrow the statement looking forward to see whether there is any reaction to the european debt crisis whether there is any reaction to the s. and p. downgrade any potential in two words of q e three on the table and all that

obviously is adding risk to the markets and suggesting that still a lot of uncertainties talk about a long term rally there are many verses right now have sold as well. do they put their money do they keep it in cash or do they look for some kind of safe haven i mean we've seen gold reach one thousand seven hundred dollars. is it too expensive right now. gold to buy all technical means is somewhat oversold at the moment however it can continue being oversold for the next several months or even quarters to come in this environment ironically despite the s. and p. downgrade what we have seen here is that the safe haven is still the u.s. dollar which is backed by u.s. treasuries in the short term there's no immediate solution to that we've seen the u.s. dollar somewhat just selling off against us which apparently is however strengthening ironically again ever against emerging markets piracies today and this is going to be the case in the near term we haven't seen any more selling dramatic the

magnitude so far in terms of future indicators in the treasuries we don't expect that to happen again and near term the u.s. is no closer to bankruptcy or to default today versus what it was last friday and everyone clearly understands that and there's no selling in treasuries because the s. and p. downgrade just one downgrade out of four nationally recognized rating agencies therefore according to these second regulation market money money market funds are not forced to sell based on this a technical downgrade so apart from statements coming like from china to get rid of the dollar as a reserve currency its position has such a currency has not really been undermined by this downgrade. exactly i would completely agree with that it's just that there is no alternative in the medium term the euro seems to be somewhat. more expensive versus where it should be

trading at the moment by logical means however there are other technical indicators that basically would require some time for the currencies to adjust to where they should be trading following the hapless that we've seen so so far. for the u.s. dollar perhaps in the medium term there should be so much appreciation but in the short term we don't expect any significant sell off the e.c.b. is more at risk at the moment therefore the euro currency is more at risk at the moment in our view and to the b.c.b. has been the question for many investors given the these safety fund that the european union has close to five hundred billion euros against a potential trouble italian debt near two trillion. euros and given that people are about obviously asking for potential lending of last resort which could be the federal reserve there are still the federal reserve the u.s. treasury says the ultimate so you have an altimeter to find a lender in this mark in this market environment at least get more of

a final question for you how you are inching money for as well as long as as the market requires and you only downside risk from just printing money is clearly a potential inflationary pressure on the market. more than how long do you think it will take before the turbulence will settle down. i think we will have to see some positive indicators of. the growth coming out of the united states in the second pop here to be confident that we're not in a double dip recession historically the. u.s. g.d.p. falling below two percent means for nine out of ten times that the u.s. market will go into recession hopefully this is not the right indicator for us at this point because this has been somewhat of a special situation put together so clearly you see some indicators of sluggish growth so far in the second quarter and it's sluggish even outside of the one also

if you have seen the future of the japanese earthquake and these spike in the oil price we will see what we need to see some growth in employment need to see some reaction from the federal reserve that's why tomorrow's narky statement is quite important. because potential. indication of you we have some monetary intervention is needed here in this environment given that the fiscal intervention is out of the question at the moment. the u.s. debt ceiling resolution whereby the u.s. government pledge not to increase their their their budget pledge to cut their spending somewhat tend to take their debt under control therefore in this environment when the government stimulus is impossible the monetary stimulus basically the fed is the ultimate hope that we have so i guess the potential monetary monitor action by the fed and does indicate is that growth is still there in the second quarter is going to help the markets or the great someone all right

thank you so much we will be looking to that statement by. choose they thank you so much for your comments and they're going to sales manager of your financial corporation talking to business. and that's all we have time for just a reminder the r.t.s. is down five and a half percent the my six three and a half percent more on those figures for you next the headlines and i still want to . wealthy british style. market why not come to. find out what's really happening to the global economy with max conjure for a no holds barred look at the global financial headlines tune into cars

a report on our. world for. bringing you the latest in science and technology from around russia. we've got the future of coverage.

here with our to live from moscow on news now away with the headlines global market fever stocks yoyo around the world and reaction to the u.s. credit rating caught and the spreading the debt crisis europe stock markets are once again in decline despite the central bank promising to buy out spanish and italian government bonds. anarchy in the u.k. parts of london turn into a battlefield for a second night as rioters and looters react to a fatal police shooting thirty five police officers were injured and over one hundred sixty people arrested. and it's three years since georgia launched an attack on the people of the small the public of south of setia we spoke to those who bear the scars of the five day conflict which claimed hundreds of innocent lives more next on what south of said he has had to overcome to get their country back on track after the war in our special report.