Robert Lewis, the Owner of Silver Charm and Charismatic, Is Dead at 81

Abstract: Robert Lewis, the owner of the Kentucky Derby winners Silver Charm and Charismatic, died yesterday at his home in Newport Beach, Calif. He was 81. The cause of death was heart failure, said his son Jeff, who added that Lewis had been in failing health. Lewis, who owned a beer distributorship in Southern California, had been a horse racing fan since his youth and recalled attending Santa Anita in Arcadia, Calif., when the track opened in 1934. He owned a small stable until he changed course in 1990 and started to develop one of the nation's most powerful racing operations. Lewis enjoyed almost instant success. By the mid-90's, his green-and-gold silks, the colors of his alma mater, the University of Oregon, were regularly seen in winner's circles across the nation. He would go on to campaign 50 horses that won stakes races. Chief among them were his two Kentucky Derby winners. Silver Charm won the 1997 Derby and the Preakness before his Triple Crown bid ended at the Belmont Stakes. Two years later, Charismatic won the Derby as a 31-1 underdog. He, too, captured the Preakness before finishing third at the Belmont Stakes. He sustained a career-ending injury at the Belmont and never raced again. Charismatic and Silver Charm are among the six champions Lewis owned. "We lost a giant," said Bob Baffert, the trainer of Silver Charm. "He was just the nicest man. He's the only guy I know who won every big race and people still rooted for him. That tells it all right there. Believe me, he will be missed by many. This is just the saddest day." Lewis's gregarious nature made him many friends in racing, a sport he loved and was constantly promoting. In 1997, Lewis and his wife, Beverly, received an Eclipse Award of merit from the racing industry for their support and commitment to the industry. "I'm sure you've heard the word ambassador a lot today," said Nick Nicholson, the president of Keeneland Race Course. "That's the way he represented the sport in public; he was a great sportsman and handled victory and defeat with equal style and class. But I also had the privilege of seeing the leadership he gave to our industry in private, when the cameras were not on." Lewis is survived by his wife and the couple's three children, Jeff, Jim and Nancy Lewis Francois.

LEWIS ROBERT
HORSE RACING
KENTUCKY DERBY
BIOGRAPHICAL INFORMATION
DEATHS (OBITUARIES)


Facebook Looks to Become Big Fish in Another Big Pond

Abstract: LONDON — Facebook is already the world’s biggest social network. Now it wants to be the biggest player in a new global field by buying WhatsApp, the global leader in mobile messaging. “WhatsApp is the biggest guy in town,” said Bertrand Schmitt, chief executive of App Annie, an analytics company that monitors app rankings worldwide. “Facebook is buying into that. It’s about global scale.” Facebook’s $16 billion deal to buy WhatsApp, announced on Wednesday, extends a deep reach in countries like Mexico, Germany and India, where the inexpensive messaging application has a big share of the markets. And it gives Facebook a chance to compete elsewhere against other messaging start-ups, like Line in Japan and WeChat in China. About 45 percent of mobile Internet messaging users rely on WhatsApp, according to the research firm Analysys Mason. The acquisition, the largest ever by Facebook, is part of its effort to create a series of applications on a user’s mobile device instead of relying on its core social network alone. It also aims to seize on the trend of more people using their mobile phones to communicate one-on-one or with very small groups, rather than sharing information more widely. WhatsApp’s growth has been explosive. The company, founded in 2009, says that about a fifth of its users, or 100 million of its 450 million subscribers, have joined in the last four months. More than 55 percent of its users are from Western Europe, Mexico, India, Brazil and the United States, according to App Annie. But while the deal gives Facebook an opportunity to reach people in different ways, it could also lead to increased competition and tension with some of the world’s largest telecommunications operators, like AT&T and Deutsche Telekom of Germany. For years, the telecommunications companies have drawn the ire of consumers who were charged high fees to send text messages. But apps like WhatsApp offer consumers a cheap or free way to send messages. WhatsApp, for example, charges $1 a year, and the first year is free. Over the last decade, companies like Telefónica of Spain and Vodafone of Britain have relied on high margins from text message services as an important source of revenue. Global carriers lost a combined $32 billion in revenue last year as consumers shifted from costly text messages to cheap Internet messaging services, according to the research firm Ovum. Some operators have tried to ban Internet messaging rivals. That includes the Dutch telecom company KPN, which blamed WhatsApp for a major downturn in its revenue in 2011. Local lawmakers later ruled that KPN could not discriminate against data traffic from rival messaging services. Other telecom companies like Orange of France and Vodafone have tried to compete by offering their own Internet messaging offerings. Yet these services, which generate little revenue compared with traditional text messages, have been limited to users on the carriers’ own networks and have therefore failed to reach a global audience. “Telecoms companies have struggled to react to the growth of services like WhatsApp,” said Steven Hartley, who runs the industry, communications and broadband team at Ovum in London. “By the time they responded, Internet messaging start-ups already had sewn up the market.” Analysts say Facebook remains in a strong position when competing with these cellphone operators. Even though it has approximately 1.2 billion global users, Facebook is still one of the most downloaded applications for smartphones worldwide. And few carriers would be willing to block Facebook’s services in fear of angering their customers. WhatsApp has been wildly popular with European customers. The company recently said that it had more than 30 million active users in Germany, and the app is now downloaded more often by European users than rivals like Skype and competing offerings from local telecom companies like Orange. And it has outpaced local rivals like Viber Media of Cyprus, which was acquired by the Japanese e-commerce company Rakuten for $900 million last week. Image WhatsApp has more than 55 percent of its users hailing from Western Europe, Mexico, India, Brazil and the United States, according to App Annie. Credit Gabriel Bouys/Agence France-Presse — Getty Images But its popularity in Europe is eclipsed by larger growth in emerging markets like Brazil and India, analysts said. As a growing number of users in developing economies, including Indonesia, have upgraded to smartphones, these customers have turned to online applications like messaging services that were previously not available on low-cost handsets. “Facebook and WhatsApp will work together to get into more emerging markets,” said Pamela Clark-Dickson, senior messaging analyst at the research firm Informa Telecoms and Media. “It’s an area where both companies want to focus on in the future.” Not every market will be easy to crack. Several well-established rivals in crucial Asian countries have so far kept both Facebook and WhatsApp at bay. In China, where Facebook is banned, the local social messaging application WeChat is the market leader for messaging, while regional rival Line dominates in Japan and Kakao is the most download Internet messenger in South Korea. WhatsApp, which is allowed in China, does not rank in the top five most-downloaded mobile social networking applications in any of these Asian countries, according to statistics from App Annie. Analysts say these Asian tech companies have built entrenched operations that Facebook and WhatsApp will find difficult to dislodge. The competitors are now expanding across the region and farther afield, including in Europe and the United States, which could hurt Facebook’s own future plans for WhatsApp. The rival messaging companies have successfully developed mobile games and other services inside their messaging services that users are willing to pay for. That contrasts with WhatsApp, where the co-founders have vehemently opposed adding advertising to generate much-needed revenue. “In countries like China and Japan, Facebook Messenger is not a leader,” said Siim Teller, a mobile analyst at the consultant firm On Device Research in London. “Facebook has a problem with innovating beyond its core social networking application.”

Facebook
Mergers and Acquisitions
Social Media
WhatsApp


Mets Trade Closer Francisco Rodriguez to the Brewers

Abstract: From the day he was hired last October until his most recent meeting with reporters on Sunday, Mets General Manager Sandy Alderson was asked what he would do about Francisco Rodriguez and his prohibitive vesting option for 2012. For a team with significant financial difficulties, finding a way to unload Rodriguez, the volatile closer who was arrested last summer for assaulting the grandfather of his children, was a vexing problem. But somehow Alderson figured it out. He traded Rodriguez and a substantial amount of cash to the Milwaukee Brewers for two players to be named later, thus unburdening the Mets from what could have been a crippling financial obligation for next year. The deal was completed Tuesday, but the Mets could not announce it until after the All-Star Game. Alderson released a brief statement after midnight. “This trade allows us to develop and more fully utilize other members of our 2011 bullpen and offers some payroll relief as well,” Alderson said. The Mets (46-45) can now try to develop the hard-throwing Bobby Parnell into a closer of the future, but they also may turn to Jason Isringhausen , who has 293 saves in his career and 11 more in the postseason. Much depends on whether Alderson considers this the first of many trades, or if he still holds hope that the Mets can compete for a playoff spot in 2011. Carlos Beltran is in the final year of his contract and Alderson will at least explore possible trades for him. Beltran, who played in Tuesday’s All-Star Game and is leading the Mets in home runs, doubles and runs batted in, has made it clear he would be willing to waive his no-trade clause to go to a winning team. Jose Reyes is also in the final year of his contract, but Alderson has already said he considers it unlikely that he would trade Reyes, who is having a most-valuable-player-type season. After a dismal start, the Mets have showed signs of progress, but they remain 11 games out of first place in the National League East, and 7 ½ games out of the wild-card lead. Even if they were within a game of first place, Alderson might still have traded Rodriguez because his contract option — a $17.5 million option for 2012 that automatically vests if he finishes 55 games — would have made next year’s payroll so unbalanced. Rodriguez, 29, has a little more than $5 million remaining on his contract for this season, and he has already finished 34 games — leaving him on pace for over 60. If the option does not vest, Rodriguez’s contract calls for a $3.5 million buyout. The Mets knew they would be paying that no matter what, so it is likely they would send at least that amount, and probably more, to the Brewers. Rodriguez, who recently hired the agent Scott Boras to represent him, could agree to waive the option for a contract extension with the Brewers, or negotiate a buyout. The Brewers have a solid closer in John Axford , who has 23 saves in 25 opportunities. That could mean Rodriguez will serve as a set-up man, which would limit his ability to get 21 more games finished. Still, the Brewers felt the deal made sense. “That’s awesome,” the Milwaukee slugger Prince Fielder said in Phoenix after the All-Star Game when he heard about the trade. “That’s a big trade; he can really help us. He’s a great player. It definitely gives us a spark. “We’re in first place now, and getting him gives us a little more help. He’s definitely gonna bring the success he’s had in his career and that confidence to the team. He’s gonna keep doing what he’s doing. You can’t go wrong getting that kind of talent.” A year ago, Rodriguez ran into problems with the Mets’ coaching staff over his usage. He complained when he did not finish certain games, and at one point got into a physical altercation in the bullpen with the mild-mannered bullpen coach Randy Niemann over how he was being used. Then, in August, he was arrested for attacking the grandfather of his children at Citi Field . He agreed to undergo court-monitored anger management therapy, which seemed to have a positive effect, and he had no reported incidents this year. Rodriguez takes a 2-2 record and a 3.16 earned run average and 23 saves in 26 opportunities to Milwaukee. Since joining the Mets in 2009, Rodriguez is 9-10 with a 3.05 E.R.A. and 83 saves in 165 games. In 2008, his last year with the Los Angeles Angels , he had a record 62 saves.

Baseball
Francisco Rodriguez
Sports Trades
Sandy Alderson


Foreign Diplomats Try to Track Down the Missing in Nepal

Abstract: KATMANDU, Nepal — The thousands of foreigners who were in Nepal when the earthquake struck have mostly been found, but hollow-eyed diplomats here still clutch lengthy lists of the names of those who remain unaccounted for. Three American women who were thought to have been trekking near Langtang, now buried under an avalanche at least 40 feet deep, are feared to have died along with nearly 200 villagers and other trekkers. Scores of other foreigners are still stranded in remote places, although their numbers are dwindling. Diplomats from all over the world descended on Katmandu, Nepal’s capital, in the days after the quake to try to find and rescue their citizens. While their tasks are less daunting than the struggles of Nepalis to recover from the tragedy, the diplomats still face major challenges. Visitors to Nepal and permanent residents from other countries do not have to register with their home countries, so most embassies have had to guess the number of their citizens in peril. Because a quake here has long been predicted, some spent years preparing. The Irish government, for instance, had helped to sponsor St. Patrick’s Day gatherings for years at two Irish pubs in Katmandu in hopes of getting a rough census of its citizens here, who number about 30. Other embassies relied on word-of-mouth estimates. The United States Embassy has tried to keep track of 2,000 to 3,000 citizens who are permanent residents, including the children of Nepalis living in the United States who had been sent back to be cared for by their grandparents. In addition, about 3,000 American citizens were estimated to be visiting Nepal at the time of the quake, according to an American Embassy official here who spoke on the condition of anonymity because he was not authorized to speak publicly. In the days after the quake, the embassy received several thousand inquiries about people believed to be missing. Some of the inquiries were hopelessly vague. One was about a man thought to be traveling somewhere in Asia sometime over the previous four months; another involved someone who turned out to be in Naples, Italy, not Nepal. Officials here were able to close the files for nearly two-thirds of the inquiries within a few days. The deaths of four Americans in an avalanche on Mount Everest were quickly confirmed. Other cases — embassy officials refused to be specific — have caused so much concern that embassy officials have sent helicopters in recent days to help them. On Thursday, three friends who had been trekking in the Langtang district were rescued by a helicopter hired by American officials. And on Friday, seven more Americans were flown back to Katmandu from remote areas that had become entirely cut off. Five of them had been visiting Serang Gompa, a 500-year-old Buddhist monastery near Bihi in the Gorkha district, the epicenter of the quake. Few places in the world are more isolated. Foreigners must get special permission to enter the area, which involves either a grueling seven-day trek or a helicopter ride. “The day of the quake, we were coming out of the temple after a two-hour ceremony of cymbals and horns and chanting, so we were already in a surreal state,” said Peggy Dylan, 62, of Sonora, Calif., who was part of a group of 12 who arrived at the monastery the day before the quake. “And then everything started to shake.” Photographs of Earthquake Devastation in Nepal When Nepal was hit with a powerful earthquake the tremor shattered lives, landmarks and the very landscape of the country. The scope of the disaster in photographs. Avalanches began to pour down the mountains around the monastery, but none of the debris touched the ancient structure. Using a satellite phone, monks at the monastery soon learned of the devastation elsewhere. But the party of foreign pilgrims decided to stay. “We thought it was probably safer there than in Katmandu,” Ms. Dylan said. But after six days, the pilgrims ran out of the food they had brought and began relying on the limited stores of the monastery. “When they started eating through the monks’ potatoes, that’s when we knew we had to extract them,” an embassy official said. A helicopter was sent to pick up the five Americans, leaving behind at least two British citizens for whom there was not enough space. A few hours later, Miguel Berkstrom, 39, a firefighter from Mendocino, Calif., and Malcolm Harkness, 39, from Point Richmond, Calif., were in the Tsum Valley of the Gorkha district when a helicopter flew over. The two Americans had been on a 34-day teahouse trek with an acquaintance, Nicholas Cooney, 71, of Calgary, Canada, when the quake struck, cutting off their routes out. They had used a village satellite phone to tell their families they were safe, and their families had told the embassy of the men’s plight. When the three trekkers waved at the helicopter, it landed in the field near them. The men, including Mr. Clooney, gathered most of their gear and scrambled aboard. They left behind their Nepali guide and two porters. Among the Americans still missing are two 19-year-old friends from Seattle, Sydney Schumacher and Bailey Meola, who were trekking near Langtang. Diane Schumacher, Sydney’s mother, said in a telephone interview that she last spoke to her daughter on April 18. “She was really excited; she’d been shopping for supplies for the trip,” Ms. Schumacher said. “She loved Nepal. She told me she was really happy.”

Nepal
Earthquake
Diplomats Embassies and Consulates
Missing person
Rescue
Fatalities,casualties


Pepsi Refresh Contestant Claims Rules Were Violated

Abstract: A group battling childhood cancer has filed a complaint against Pepsi , contending that its popular charity fund-raising contest, Pepsi Refresh, has been infiltrated by organizations with a political agenda. The group, Arms Wide Open Childhood Cancer Foundation, which raises money for alternative therapies and treatments for children with neuroblastoma, has been competing in the September contest to win $250,000 from Pepsi, ranking second Thursday night. Arms Wide Open contends that a group of 16 organizations called the Progressive Slate have also been vying for votes and funds and are “essentially political groups tied to the Democratic Party ” and thus violate the contest’s rules. “We have concerns about the fairness of this contest,” said John K. Bartosz, a lawyer representing the charity whose son has neuroblastoma, a cancer that develops in the nervous system and mostly affects infants and children. He added, “We’ve built a grass-roots effort to tell our families and friends to vote for us, and now we learn that we’re up against a political machine.” Through Pepsi Refresh, Pepsi is giving more than $20 million to charities this year, allowing 1,000 organizations to compete for grants of $5,000, $25,000, $50,000 and $250,000 each month. Online voters decide who wins. The complaint is another example of concern over nonprofit groups using tax-exempt dollars for political purposes in the current election cycle. On Wednesday, Senator Max Baucus, Democrat of Montana and chairman of the Senate Finance Committee, sent a letter to the I.R.S. asking it to investigate the use of tax-exempt groups for political purposes. The contest rules state that applications cannot be for projects that would advance, lobby or expand membership for a political party, candidate or cause. Groups belonging to the Progressive Slate, many of which are skilled at voter registration and community organizing, are collectively working to help each other win the contest. The strategy is proving successful: as of Thursday evening, eight of the top 10 contestants in the $50,000 category were Slate members, and two members were among the top five contestants vying for $250,000. Many of their Web sites promote liberal agendas, featuring comments from MoveOn.org, recommending LeftyBlogs.com , and displaying membership lists that include labor unions. They are led by the Center for Progressive Leadership, a nonprofit group whose eight-member board includes two Democratic members of the House of Representatives; Kathleen Kennedy Townsend, a Democrat and the former lieutenant governor of Maryland; Matt Dunn, a Democrat who failed to win the party’s nomination to be governor of Vermont; and Mike Lux, a Democratic political operative who helped found the organization. Peter Murray, president of the center, said Arms Wide Open’s complaint had no merit and was nothing more than a competitive tactic in the final hours of the September competition. “These are all nonpartisan, nonprofit charitable organizations,” Mr. Murray said. “The projects that are seeking support have no political or advocacy or lobbying elements to them whatsoever. They are for helping kids, young people, helping the homeless, helping the poor.” Peter Land, a Pepsi spokesman, said, “We evaluated each idea solely on the basis of the merits, and each met our guidelines, which state that an idea cannot support or endorse any political candidate or party.”


Hyundai to Expand in China With a New Factory

Abstract: SEOUL, South Korea — The South Korean carmaker Hyundai Motor said Wednesday that it was planning to build a fourth plant in China, which would be its first major overseas expansion in more than two years. Hyundai and its affiliate Kia Motors would use the facility in the southwestern city of Chongqing — to cost 1 trillion won, or $929.5 million — to protect their share of the world’s biggest car market, which accounted for more than a fifth of their global vehicle sales last year. “Considering China’s future demand growth outlook, we need to build a new plant to maintain our stable market share of 10 percent in China,” Hyundai said in a statement. The move signals the end of a period of consolidation for Hyundai, which has been focusing on improving quality, rather than expanding capacity, to avoid the sort of recalls that have dogged Toyota Motor. Competitors like Volkswagen, General Motors and Nissan Motor are aggressively increasing capacity in China, putting pressure on Hyundai and Kia. “They are expected to build more plants in China to keep up with market growth,” said Ko Tae-bong, an auto analyst at Hi Investment & Securities. “I also expect Hyundai to build a new plant in the United States, as it is physically impossible to further expand production due to capacity constraints.” Chung Mong-koo, chairman of the Hyundai group, is scheduled to sign a preliminary deal Thursday with the government of Chongqing, the company said. Hyundai already has three plants in Beijing for its joint venture with Beijing Automotive Industry Holding. The new plant will bring total capacity in China to 2.3 million vehicles a year for Hyundai and Kia, from a projected 2 million at the end of 2014, the company said. The last time Hyundai or Kia announced a new factory project was in late 2011, when Kia unveiled a plan to build a third China facility. That plant is to be completed early this year. China is a bright spot for Hyundai and Kia, which have been grappling with lackluster sales in the United States and Europe. China was the biggest market for the two automakers last year, which saw their combined sales rise 18 percent to 1.58 million vehicles. Those sales are expected to increase a further 8 percent, to 1.7 million vehicles, this year as the new Kia plant comes online. Hyundai also plans to start production at a new commercial car plant in Sichuan Province this year. Global carmakers including Ford Motor and Volkswagen are stepping up investment in China’s inner provinces, where rising personal income is propelling car sales. In 2012, Ford announced it would invest $600 million to make more cars at its plant in Chongqing, and G.M. unveiled plans to build a $1 billion auto assembly plant in the city. The focus on Chongqing comes as car markets in China’s coastal cities grow increasingly crowded and vulnerable to restrictive government policies. On Wednesday, China’s eastern city of Hangzhou started restricting car sales, joining major cities including Shanghai and Beijing in a fight against pollution and traffic jams.

Hyundai Motor
Kia Motors
China
Cars
Chung Mong Koo
Manufacturing


Long Island Rosé Has French Flair

Abstract: Corey Creek’s Domaines CC is one of Long Island’s most charming 2007 rosés. Francophiles can appreciate this pink mélange of merlot , cabernet sauvignon and cabernet franc grapes. It was made at Bedell Cellars, Corey Creek’s sister winery. The rosé, fruity and piquant, easily accompanies bouillabaisse, boiled shrimp and grilled salmon. Windsor Wine Shop, 474 Third Avenue (33rd Street), charges a bargain $11.99.

Wines
Long Island (NY)
Alcoholic Beverages
Goldberg Howard G


Toyota to Finance $50 Million ‘Intelligent’ Car Project

Abstract: The Toyota Motor Corporation announced on Friday an ambitious $50 million robotics and artificial intelligence research effort, in collaboration with Stanford University and the Massachusetts Institute of Technology , to develop “intelligent” rather than self-driving cars. The distinction is a significant one, according to Gill Pratt, a prominent American roboticist, who has left his position at the Defense Advanced Research Projects Agency of the Pentagon to direct the new effort. Rather than compete with companies like Google and Tesla, which are developing cars that drive without human intervention, Toyota will focus its effort on using advances in A.I. technologies to make humans better drivers. Dr. Pratt described the two approaches as “parallel” and “serial” autonomy. In layman terms, parallel means the machine watches what you do, while serial means it replaces you. Toyota, the world’s largest carmaker, envisions cars of the future that will act as “guardian angels,” watching the driving behavior of humans and intervening to correct mistakes or avoid collisions when needed. Dr. Pratt said Toyota’s goal was to keep the “human in the loop” in the car of the future and to ensure that driving remained fun. “A worry we have is that the autonomy not take away the fun in driving,” he said. “If the autonomy can avoid a wreck, it can also make it more fun to drive.” Driver assistance technology — like pedestrian and bicyclist detection and avoidance systems, lane-departure warning and “lane keeping” systems, and software programs that alert drivers that they are becoming drowsy — have already become standard safety options from carmakers. The Toyota program will focus on developing more artificial-intelligence-based monitoring systems. For example, in the future, an A.I. system might do more than warn drivers that they are leaving their lane and actively correct all kinds of driver errors. Another possibility might be to use A.I. technologies to permit aging drivers to continue to drive by offering driver assistance in areas like vision and reaction time. “In parallel autonomy, there is a guardian angel or driver’s education teacher,” Dr. Pratt said. “It usually does nothing, unless you are about to do something dumb.” Before joining Toyota, Dr. Pratt served as a Darpa program manager. Beginning in 2012, he oversaw a “Grand Challenge” contest there to design semiautonomous mobile robots capable of performing useful tasks in disaster areas where humans would be at risk, such as the Fukushima nuclear power plant disaster. The contest was won earlier this year by a South Korean-designed robot that performed a series of tasks like driving, walking, opening doors, using power tools and climbing stairs. Twenty-three teams participated in the contest. However, it provided a striking contrast to science fiction movie portrayals of robots as superhuman machines that operate with agility, dexterity and speed. During the contest, the robots exhibited little autonomy, moved glacially and often fell while doing tasks that are routinely performed by human toddlers. Toyota will finance researchers at the Stanford Artificial Intelligence Laboratory and the M.I.T. Computer Science and Artificial Intelligence Laboratory to undertake a five-year project to make advances in both automotive transportation and indoor mobile robotics that might have applications in new markets like elder care . Around the globe, human populations are aging in the more advanced countries, Dr. Pratt noted. This is raising what economists call the “dependency ratio,” a measure of the number of those in the work force compared to both young and old dependents. In the United States, the dependency ratio is expected to increase 52 percent in the next 15 years, while in Japan it is expected to increase 100 percent. The development of intelligent transportation technologies and elder-care-related robots holds the promise of giving the aging more independence, he said. “I had to take the car keys from my dad,” he said, arguing that losing independence is “also an awful way for a parent to live. Most retired people want independence in a human sense. Let’s use robotics to let people live in more human way.” By financing the Stanford and M.I.T. artificial intelligence laboratories, Toyota is tapping into talent and experience in technologies that have recently made significant progress in perception, dexterity and autonomous motion. The two laboratories were founded by the artificial intelligence pioneers John McCarthy and Marvin Minsky in the 1960s and have produced basic innovations in artificial intelligence and robotics, as well as educated multiple generations of researchers. Currently, Fei Fei Li, a computer scientist who is a specialist in machine vision, leads the Stanford laboratory, and the M.I.T. laboratory is led by Daniela Rus, a roboticist who has worked in new areas such as distributed and collaborative robotics. “I see why Toyota wants to do this,” said Dr. Li. “It is the biggest carmaker in the world, and it wants to influence the next generation.” The research will concentrate on keeping “the human in the loop,” which is a break from the direction of much A.I. research, which has focused on building systems and machines that replace humans. “We see this as basic computer science, A.I. and robotics that will make a difference in transportation,” said Dr. Rus. Dr. Pratt acknowledged that as a teenager, he had a passion for cars. “I had six cars, and Toyotas were the cars I loved to fix myself,” he said.

Toyota Motor
Cars
Artificial intelligence
Robot
College
MIT
Stanford
Research
DARPA
Gill Pratt


For Obama, Two Setbacks But Varying Responses

Abstract: WASHINGTON — For President Obama, this week delivered a painful double blow, with the Senate defeating his emotional campaign to pass tougher gun legislation and a pair of crude bombs at the Boston Marathon bringing terrorism back to American soil. But Mr. Obama responded very differently to the setbacks — a difference that speaks to a conviction at the White House that the nation’s counterterrorism policies are still basically sound, while the nation’s gun laws are demonstrably not. On Wednesday in the Rose Garden, flanked by parents who lost children in the December rampage in Newtown, Conn., Mr. Obama seemed at a loss to understand why the Senate did not break from the past on gun laws, departing from his text to deliver a lecture that was by turns angry, sarcastic and sorrowful. The next day, standing in the sanctuary of the Cathedral of the Holy Cross in Boston, the president delivered a tightly written paean to the city’s resilience, serving notice with his almost-jaunty greeting — “Hello Boston!” — that he was there as much to fight as to grieve. “If they sought to intimidate us, to terrorize us,” Mr. Obama said to swelling applause, “well, it should be pretty clear by now that they picked the wrong city to do it.” To some observers, the contrast was revealing about the political costs and benefits of both issues for Mr. Obama. “Boston looked polished, and the Rose Garden looked anguished,” said Peter D. Feaver, a Duke University professor who was a national security aide to former President George W. Bush. At one level, the Boston bombings would seem to cast a long shadow over the White House. They were the first successful terrorist attack on an American city during Mr. Obama’s presidency. And with the investigation still under way, it is too soon to say whether they were carried out by foreign or domestic individuals or terrorist groups. An act of terror carried out by a foreign group would raise broader questions about the administration’s counterterrorism policies than would a domestic attack. Either way, Mr. Obama has moved swiftly to try to put the bombings in perspective — an act of terror and a tragic loss of life, but not enough to derail a single city, let alone the country. The bombers, he said, were “small, stunted individuals who would destroy instead of build, and think that somehow makes them important.” For President Bill Clinton, the Oklahoma City bombing in April 1995 helped him reclaim the mantle of leadership after a dispiriting period in which the Democrats were trounced in midterm elections and Mr. Clinton had seemed almost marginalized by House Speaker Newt Gingrich. The Boston bombings could allow Mr. Obama to achieve a different goal: moving the country’s response to acts of terrorism away from the sense of national crisis that followed the Sept. 11, 2001, attacks to a narrower focus on effective law enforcement. “Boston is not big enough to change the narrative about President Obama,” Mr. Feaver said, “but it might be big enough to change the public’s response to terrorism.” With the loss of the gun vote, by contrast, the president does not have a clear path forward. The Senate’s rejection of even a watered-down system of background checks, experts say, all but extinguishes the chances to pass new legislation, and from here on, any significant action on gun-safety laws will be at the state level. For Mr. Obama, the loss is especially stinging because it came after the national revulsion at the schoolhouse slaughter in Newtown raised hopes for a once-in-a-generation change. Devastated personally, the president pledged at a memorial service to use “whatever power this office holds” to turn the tide on gun regulations. As they debated what Mr. Obama should do, administration officials said they were well aware that it would be an uphill struggle. But they believed that it was better to try and lose, than to appear cynical. Four months later to the day after the service, Mr. Obama stood in the Rose Garden, asking how senators could vote against a measure that was supported by 90 percent of the public. “There were no coherent arguments as to why we wouldn’t do this,” he said. “It came down to politics.” Aides said it was the angriest they had ever seen Mr. Obama in public. The question now is whether the defeat will derail the president’s other legislative priorities, like the budget and an overhaul of immigration laws. Administration officials argue that it will not: immigration, for example, poses different challenges to Republicans. In Boston, Mr. Obama did not draw any link between the bombings and the debate over gun violence. But the White House officials were quick to contrast the displays of heroism after the attacks with what they said was a lack of courage on the part of those who voted against the gun law. “What you see is this fundamental belief in the greatness of the country, and the utter failure of the political system to serve it,” said Dan Pfeiffer, a senior adviser to the president. For some in the White House, the president’s remarks in the Rose Garden recalled a rousing speech he gave after unexpectedly losing the New Hampshire primary to Hillary Rodham Clinton in 2008. A deeply demoralizing moment was turned into a rallying cry. But this week has evoked even more distant memories. The arrest of a man for sending a letter to the president that was believed to be contaminated by ricin carried unwelcome echoes of the anthrax-laced letters that were delivered to two Democratic senators in the weeks after the Sept. 11 attacks. Two of Mr. Obama’s top deputies — Denis R. McDonough, the chief of staff; and Pete Rouse, counselor to the president — worked for one of those senators, Tom Daschle, Democrat of South Dakota, at the time, and Mr. Pfeiffer joined his staff after that. “In a week when a lot was happening,” Mr. Pfeiffer said, “it was just one more thing.”

Barack Obama
Legislation
Gun Control
Boston Marathon Bombings
Terrorism
US Politics
Polls


The Voice of the Clippers

Abstract: LOS ANGELES — When Doc Rivers walked into a conference room Tuesday night that was so packed that dozens of reporters were turned away, he took a deep breath and exhaled as he sat behind the microphone. He then proceeded to do what he had spent much of the previous three days doing: answering question after question about his employer, the Los Angeles Clippers’ owner, Donald Sterling. When Rivers arrived here last summer, lured by a three-year, $21 million contract and the promise of a team brimming with talent, it made for an interesting dynamic: a coach and chief basketball executive with a Celtics pedigree trying to win a championship in a Lakers town. Rivers, by all accounts, has done a masterly job. He helped engineer smart deals, adding the sharpshooter J. J. Redick to open up the floor and veteran role players like Danny Granger, Hedo Turkoglu and Glen Davis on the cheap. He has brought a commanding presence to the bench, been a strong influence on the team’s core of Blake Griffin, Chris Paul and DeAndre Jordan, and led the team to a franchise-record 57 victories. But he has never been more valuable to the Clippers than in the last few days. To a franchise that has needed a voice, he has provided one that has been at once calm and defiant, reassuring and resolute. Rivers has shared with his team his own experiences with racism, including the burning of his house, and encouraged them to do the same. He has talked with Commissioner Adam Silver, Mayor Eric Garcetti of Los Angeles and Mayor Kevin Johnson of Sacramento, the former player who has been representing the players union. Earlier Tuesday, he spoke with Rochelle Sterling, the wife of the owner, telling her she was welcome. While his players have been shielded from the news media, except for after games, Rivers has answered questions each day, inside the locker room and out, in a revealing way. “He was stoic,” Redick said. “He was emotional. He was angry, just like anyone else. But he didn’t allow that anger to get him off focus. He’s handled it beautifully. It’s almost like he was the right guy to be here.” Redick was speaking late Tuesday night after the Clippers’ 113-103 victory over the Golden State Warriors earned them a 3-2 lead in their first-round Western Conference series. It was a bounce-back performance by the Clippers, who on Sunday played as if they were distracted in the Game 4 loss. Nobody bounced back better than their center, Jordan, who was scoreless Sunday. He had the best playoff game of his career in Game 5 with 25 points, 18 rebounds and 4 blocks. The Clippers took the court to a standing ovation, one that guard Jamal Crawford, in his 14th season, said gave him chills. The welcoming environment came after Silver announced earlier in the day that Sterling would be barred for life and that the league’s other 29 owners would soon vote on whether to remove him as the owner for his incendiary remarks about African-Americans. When Sterling was heard in an audio recording telling his former girlfriend that she should not associate in public with blacks, it struck a deep chord with many in the Clippers’ locker room, who were at the heart of a public debate in December when forward Matt Barnes was fined $25,000 for using a racial slur on Twitter. Armond Hill, an assistant, spoke to the team about what it was like to be called by that slur in public. “That’s why this is such a hot topic, because it touches people, it’s happened to people, it’s so personal,” Rivers said. In 1997, Rivers’s house in San Antonio was burned to the ground in what the police believed was a racially motivated attack. Rivers was in Seattle at a golf tournament while his wife, Kris, who is white, was visiting relatives in Wisconsin with their four children. San Antonio Spurs General Manager R. C. Buford, then a scout with the team, happened to be nearby. He raced into the burning house and salvaged some of the family’s memorabilia, but the cats and dogs belonging to the Rivers family died in the blaze. “My dad was the rock,” said Jeremiah, their oldest son, who is now 26. “My mother was in shambles. I remember her falling to her knees. I’ll never forget the picture. We’re on vacation. She drops to her knees bawling. My grandfather was there trying to console her.” “My parents sheltered a lot from us,” he added. “They never showed us the graffiti, the slander, the remains of the animals. But we didn’t leave. My dad doesn’t operate that way. We just started over.” Jeremiah and his brother Austin, a 21-year-old guard with the New Orleans Hornets, saw their father being there for his team the way he had been there for them. So they flew to Los Angeles on Monday, joining their sister, Callie, who lives here. (Another brother, Spencer, is in high school in Winter Park, Fla.) Rivers gave his players the day off Monday, sensing they needed to spend time with their families. He spent the day with his children. He was exhausted, having slept for 45 minutes Sunday night. They ordered dinner in at Rivers’s condominium in Beverly Hills and planned to watch a movie, but were instead riveted to the N.B.A. playoffs. Jeremiah, Callie and Austin attended the game Tuesday night, all wearing black, as many fans and team officials did to show solidarity with the players. “The biggest thing with my dad is he’s able to live with the result with whatever he chooses to do,” Austin said. “When you live like that, you don’t have to change who you are, and your emotions stay the same. He does what he feels is right and he lives with the result. You don’t shake or shiver.” Bernard Parks, a member of the Los Angeles City Council and a former police chief, said Rivers had been a magnificent voice not only for his players, but also for the city. That Rivers rejected an overture from Sterling was a strong, symbolic gesture. “He’s been a shield, taking all the heat for everybody, not just his players,” Parks said. “There are few people, no matter who you were, no matter the circumstances, if the owner called and said can we talk, a lot of people would be sitting in that office saying, Yeah, what do you want?” Rivers, with few exceptions, has been open and nonjudgmental about the opinions of his players and others about the proper response. He has said he was unsure if he would return to coach next year, but conceded it is more likely if a new owner is in place. One point he has tried to make repeatedly is that victims of racism are unfairly asked to respond. That is a burden, he said, that should fall to others. And so if players had wanted to boycott, fine. If players wanted to wear black socks and turn their practice jerseys inside out, fine. That is why Rivers was so pleased that many others took up the fight: Silver drove the disciplinary process; the involvement of Johnson and Roger Mason Jr., the vice president of the players union, removed the burden from Paul, a Clippers guard and the president of the union; and a loud chorus denounced Sterling. Paul, without prompting Tuesday night, made a point of praising Rivers’s leadership. “I couldn’t imagine having another coach who was there, communicating with us, asking us how we’re feeling and not just tell us, ‘We’re going to do this, we’re going to do that.’ ” Paul said. “He actually listened to us throughout this entire thing.”

Race and Ethnicity
Clippers
Doc Rivers
Donald Sterling
Basketball
Discrimination
Black People,African-Americans


Kremlin Finds a Defender in Congress

Abstract: WASHINGTON — It is a lonely pursuit these days, defending Russia in Congress as outrage over Kremlin aggression grows louder. But Representative Dana Rohrabacher speaks up for Moscow with pride. He is, he says, a bit frosted with the Russian government in one respect. “I kind of wish I would get some sort of word back,” Mr. Rohrabacher, a California Republican, said Thursday shortly before the House voted 399 to 19 to offer aid to Ukraine and impose sanctions on Russia. “But I haven’t even gotten so much as a thank you.” The 13-term congressman has had a long, strange journey from fierce Cold Warrior to apologist for President Vladimir V. Putin of Russia. In 1966 when Ronald Reagan was running for governor of California, Mr. Rohrabacher camped out in the candidate’s backyard, pleading for an audience to prevent the disbanding of his Youth for Reagan group in favor of a rival’s. By last year, Mr. Rohrabacher was accompanying the action star Steven Seagal to Russia in search of a broader Islamist plot behind the Boston Marathon bombing. The actor and the congressman had often discussed “thwarting radical Islamic terrorism,” he explained. Then came Russia’s takeover of Crimea, and Mr. Rohrabacher had to draw the line — in favor of Mr. Putin. “There have been dramatic reforms in Russia that are not being recognized by my colleagues,” he said. “The churches are full. There are opposition papers being distributed on every newsstand in Russia. You’ve got people demonstrating in the parks. You’ve got a much different Russia than it was under Communism, but you’ve got a lot of people who still can’t get over that Communism has fallen.” What about Pussy Riot, the Russian protest group? Its members were jailed for criticizing Mr. Putin, released, then publicly flogged when they showed up at the Winter Olympics in Sochi. “Well, I don’t think that happens often,” Mr. Rohrabacher said with a shrug. “There are lots of people demonstrating in the streets of Russia who are perfectly free to do so.” Surfer, scuba diver, buddy of the rock star Sammy Hagar, Mr. Rohrabacher has always kept to his own beat. He claimed last year that he lost a drunken arm-wrestling match with Mr. Putin when he was deputy mayor of St. Petersburg in the 1990s. Three years ago, Mr. Rohrabacher, now 66, was thrown out of Iraq after demanding that the Baghdad government repay the United States for the cost of the 2003 invasion. He is now in a legal fight in his native Orange County, Calif., over a house he rented that the owners say he left looking like a pigsty, crawling with maggots. There is a history of House members backing unpopular foreign leaders. In 2002, Representative Jim McDermott, Democrat of Washington, made a trip to Baghdad to defend Saddam Hussein’s record on international inspections and his dismantling of unconventional weapons. It earned him the nickname Baghdad Jim from many pro-war conservatives. Representative José E. Serrano, Democrat of New York, was such a consistent supporter of President Hugo Chávez of Venezuela that he posted on Twitter after the president’s death last year that Mr. Chávez was “committed to empowering the powerless.” There is some logic to Mr. Rohrabacher’s stalwart defense of the Kremlin’s actions. The people of Crimea have spoken, he says, and voted resoundingly to leave Ukraine and join the Russian Federation. To stand for the sanctity of Ukraine’s national borders, he says, is to stand for “soil and entities” over individual rights and self-determination. Was Abraham Lincoln wrong, then, to fight the Confederacy’s self-determination? Not at all, Mr. Rohrabacher said. Because women and blacks — slave or free — were not allowed to vote, Southern sentiment before the Civil War was not nearly as clear as it is in Crimea. Sixteen other Republicans voted against the Ukraine aid bill on Thursday, but most — if not all — did so on fiscal grounds. They included the most vocal members of the Tea Party wing and the usual so-called Dr. Nos of the House, like Justin Amash of Michigan and Thomas Massie of Kentucky. “Russia has violated Ukraine’s sovereignty; therefore, certain nonmilitary punitive measures against those responsible in Russia may be appropriate,” Mr. Amash explained on his Facebook page. “But I am not persuaded at this time that U.S.-guaranteed financial assistance for Ukraine’s interim government will produce good outcomes for the United States or Ukraine.” It seems that defending the invasion of a sovereign nation and the annexation of part of it is a tough political position to hold. Senator Rand Paul, the libertarian-minded Republican from Kentucky who is considering a White House run, told The Washington Post in February that “some on our side are so stuck in the Cold War era that they want to tweak Russia all the time, and I don’t think that is a good idea.” But about two weeks later, in Time magazine, he wrote that “Putin must be punished” and “Russia must learn that the U.S. will isolate it if it insists on acting like a rogue nation.” Mr. Rohrabacher has found a kindred spirit on the fringe of the Democratic Party: Representative Alan Grayson of Florida, whom conservatives love to loathe. He complained bitterly as the House Foreign Affairs Committee drafted its Russia sanctions bill on Tuesday. “Why are we speaking about naked aggression, why are we speaking about stealing Crimea, why are we speaking about bullying, or the new Soviet Union, or thuggery, or audacious power grabbing, or Bully Bear Putin, or Cold War II?” Mr. Grayson said. “We should be pleased to see, pleased to see, when a virtually bloodless transfer of power establishes self-determination for two million people somewhere in the world.”

Dana Rohrabacher
Russia
Ukraine
Crimea
House of Representatives
Congress


N.H.L. Winter Classic’s Ratings Rise

Abstract: The Winter Classic in Pittsburgh between the Penguins and the Washington Capitals on New Year’s Day was seen by an average of 4.5 million viewers on NBC. It was the most-watched N.H.L. regular-season game since a Rangers win over the Philadelphia Flyers in February 1975 attracted 5.5 million viewers. The Winter Classic game, scheduled to begin at 1 p.m. Eastern, was delayed by rain and did not start until 8. The shift to prime time might have helped increased viewership, although the game had to compete against the Fiesta Bowl on ESPN, which was seen by an average of 10.8 million viewers. The 4.5 million viewers for the fourth edition of the Winter Classic, at Heinz Field, topped the 3.7 million for last year’s Boston Bruins-Flyers game at Fenway Park, and the 4.4 million for the 2009 Detroit Red Wings-Chicago Blackhawks matchup at Wrigley Field. The league would not say if future Winter Classics would be held in prime time; that discussion will be a part of talks with NBC, whose N.H.L. contract expires after this season. The league is also in an exclusive negotiating period with Versus about renewing its expiring deal. RICHARD SANDOMIR

Television
Winter Classic
Hockey Ice
NBC Universal


On a Trip That Avoids Beijing, Obama Keeps His Eye on China

Abstract: KUALA LUMPUR, Malaysia — On every stop of his Asian journey in the past week, President Obama has spoken to two audiences: America’s allies and China. The balancing act has become even trickier because of the sharp deterioration in America’s relations with Russia. Perhaps no country has more to gain from a new Cold War than China, which has historically benefited from periods of conflict between the United States and Russia and, analysts say, could exploit these latest tensions to lean even harder on its neighbors in the region. As Mr. Obama has traveled from Japan to South Korea and, now, Malaysia, he has delivered a carefully calibrated message to reassure America’s friends of its support while discouraging the Chinese from any thoughts of opening a second front on the Pacific Rim. In Tokyo on Thursday , Mr. Obama vowed to defend Japan in a territorial dispute with China, but urged the Japanese to show restraint and insisted that he wanted solid relations with Beijing. The next day in Seoul , the South Korean capital, he pledged to defend South Korea from the renegade North, a Chinese ally, but went out of his way to enlist Beijing in that effort. “We’re not interested in containing China,” Mr. Obama said, even as he embarked on what some experts said could be portrayed as a “containment tour,” visiting four countries that worry about Chinese expansionism while skipping Beijing itself. “We’re interested in China’s peaceful rise and it being a responsible and powerful proponent of the rule of law,” Mr. Obama insisted. But he added, “In that role, it has to abide by certain norms.” The president laid out a vivid case for why China should not mimic Russia’s adventurism. The escalating sanctions against Russia for its threats to Ukraine, he said, will weaken an economy already challenged by its reliance on oil and gas. The portrait Mr. Obama painted of Russia was withering. Speaking in Tokyo, he said Russia “needs to diversify its economy, because the rest of the world is moving further and further off the fossil fuels that are the primary way that Russia is able to bankroll itself.” By playing up Russia’s weaknesses and predicting that they will worsen because of President Vladimir V. Putin’s aggression, Mr. Obama seemed to be saying to Chinese officials who might be contemplating closer ties with Moscow: Stick with a winning team. “The message is: ‘Don’t think that what Putin is doing in eastern Ukraine is so brilliant that you should be inspired by it. Don’t think that this is a model that could work for you,’ ” said Jeffrey A. Bader, who was the senior China adviser on the National Security Council until 2011. Mr. Bader warned last week that a few poorly chosen phrases could turn Mr. Obama’s trip into a containment tour. But he said the president had gotten the balance right in Japan and South Korea, robustly reaffirming America’s support for its treaty allies while avoiding statements that would isolate or antagonize China. So far, China’s reaction has been muted. The Chinese Ministry of Foreign Affairs issued a perfunctory objection to Mr. Obama’s assertion that the American security treaty with Japan obligates the United States to protect a clump of islands in the East China Sea that are administered by Japan but claimed by both Japan and China. But it has been silent since then, much as it abstained from the debates in the United Nations over Russia’s actions in Crimea. China, some analysts said, is content not to pick a fight with the United States at a time when events, in Asia and elsewhere, seem to be going in its favor. Leaders in Japan and South Korea said they were reassured by Mr. Obama’s words. But among experts in both countries, there was lingering uneasiness about the depth of American resolve. “The wording of his statements was O.K., but if you look at his demeanor and tone, he was very nuanced and trying not to get entangled in disputes with China,” said Narushige Michishita, an expert on security policy at the National Graduate Institute for Policy Studies in Tokyo. Lee Geun, a professor of international studies at Seoul National University, said the situation in Ukraine raised inevitable questions. “What if North Korea tries something, or what if China tries to do something with North Korea?” he said. “Would the U.S. come to South Korea’s defense?” Administration officials say the United States is better placed in Asia than it has been for years. Malaysia, which once had an openly anti-American government, is now cautiously looking to work with the United States. Myanmar, after decades of isolation during which it became heavily dependent on China, is also eager to engage. But none of this will spare Mr. Obama from his balancing act. In Malaysia, where he arrived on Saturday, he will meet with government officials who have come under fierce criticism from the Chinese authorities for their handling of the search for the missing Malaysian airliner. Many of the passengers on the plane were Chinese. Malaysia has its own territorial disputes with China, in the South China Sea, on which it would welcome American support. Benjamin J. Rhodes, a deputy national security adviser, said Mr. Obama’s position was that “big nations should not be able to coerce smaller nations.” That issue will be even more pointed in the Philippines, where Mr. Obama will travel on Monday. The country has been locked in an increasingly tense standoff with China over the Scarborough Shoal, a popular fishing ground now occupied by Chinese ships. The United States hopes to announce an agreement to expand access for American warships and planes to bases in the Philippines, giving the United States a visible military presence there for the first time since it relinquished the Subic Bay Naval Base in 1992. That would also send an unmistakable message to China, though last-minute legal issues in the Philippines have raised questions about whether the deal will be ready for the president to sign. As Mr. Obama traveled from South Korea to Malaysia, even his route attested to the perils of the new Asia: Air Force One flew through an air defense zone over the East China Sea that China announced last year to reinforce its territorial claims , provoking protests from Japan. At the time, the United States brushed aside China’s requirement that planes identify themselves when flying into the zone, dispatching two B-52 bombers to prove its point. On Saturday, an administration official said, Air Force One filed only a routine flight plan. Except for a little turbulence, the plane passed through the area smoothly.

US Foreign Policy
Barack Obama
Asia
China
Japan
South Korea
Russia
US
Ukraine


Iran Officials Assert Defiance of West in Aftermath of Nuclear Talks

Abstract: TEHRAN — Iranian politicians and military commanders said Wednesday that their country would never relinquish what they called its nuclear rights, a day after talks between Iran and world powers in Moscow failed to make substantive progress in the dispute over Iran’s uranium enrichment. Some commanders even asserted that Iran was not only impervious to Western threats but poised to dominate economically, despite evidence that the accumulation of sanctions on Iran, which are set to intensify in a few weeks, could cripple its ability to sell oil, the country’s economic lifeline. But the higher-ranking Iranian officials who set out the countries policies and whose comments determine the scope of reactions to international events have not yet publicly reflected on the outcome of the Moscow talks. Besides the Tuesday news conference by Iran’s top nuclear negotiator, Saeed Jalili, in Moscow, who said the talks had been “realistic and serious,” there has been no reaction by the supreme leader, Ayatollah Ali Khamenei or President Mahmoud Ahmadinejad. The talks yielded no result other than a lower level technical meeting in two weeks and only the possibility of the top negotiators getting together. The technical meeting will take place a few days after the European Union’s July 1 embargo on Iranian oil and ban on shipping insurance for Iranian oil, which will vastly complicate Iranian oil sales to Asian buyers. Most maritime insurers are based in Europe and they are prohibited from writing policies on any Iranian oil shipped anywhere. South Korean officials on Wednesday told the Korean Yonhap news agency the new sanctions would force them to completely stop buying oil from Iran, even though the country secured an American waiver allowing South Korea to buy some Iranian oil without incurring penalties under a United States law that sanctions Iran. Japan, another major customer of Iranian crude that has secured an American waiver, is taking steps to provide government guarantees on insurance. A senior member of Iran’s parliament, Mohammad Reza Bahonar, in a Wednesday news conference, stressed that the Moscow talks had been positive for Iran as they allowed the country to gauge whether the world powers are serious in the negotiations. “Iran submitted a good proposal to them,” he said. While Iran’s leaders initially showed optimism over renewed talks on their nuclear program in April, they became disappointed after what they say was the United States withdrawal of a promise to affirm their right to enrich uranium. Iran is in violation of a series of United Nations Security Council resolutions demanding that it halt all forms of uranium enrichment. Iran regards the resolutions as illegitimate. Western powers and Israel have accused Iran of stockpiling enriched uranium as part of an effort to achieve the capability to make nuclear weapons . The Iranians have denied those accusations and say a fatwa, or religious decree, by Ayatollah Khamenei forbids such weapons as against Islam. Iranian leaders, including President Ahmadinejad, have hinted that if the world powers officially accepted Iran’s nuclear energy program, Iran would halt its enrichment of uranium to 20 percent purity, which is considered a technical step away from weapons grade purity of 90 percent. “The world powers should recognize Iran’s nuclear rights. Iran will never give up its right to achieve peaceful nuclear technology," Mr. Bahonar told the state Islamic Republic News Agency. The rial, Iran’s currency, lost some value against the dollar and euro in the aftermath of the Moscow talks, partly on expectations that the looming new sanctions on Iran would further impair its economy. The rial has lost over half its value relative to the dollar in the past 12 months, which has doubled prices of many imports. There have been no new calls from Iranian officials telling citizens to be prepare for difficult times, but the commander-in-chief of the voluntary paramilitary forces said Wednesday said that world powers would fail in their coercion efforts. “Iranian people are ready to prove that the world powers are nothing, which means that they cannot wage a war or put pressure on Iran," the commander, Brig. Gen. Mohammad Reza Naqdi, was quoted as saying by the semiofficial Fars news agency. Some said Iran’s economy was in its best shape ever and poised to emerge as a world powerhouse. The commander of the Revolutionary Guards Corps, Brig. Gen. Hossein Salami, said that "60 percent of the energy of the universe has been secured by Iran,” the semiofficial Islamic Labour New Agency reported, making Iran ready to “dominate the world economy.” Pressures and sanctions have only made Iran stronger, he concluded. “Today we are witnessing the political funeral of the West,” General Salami said.

Iran
Nuclear Weapons
Jalili Saeed
International Relations


Alabama May Turn to the Gambling It Has Long Fought

Abstract: MONTGOMERY, Ala. — After years of crackdowns, police raids, Bible Belt oratory and admonitions about corruption, Alabama lawmakers have had a change of heart. They are now seeking fiscal salvation at the casino. The State Senate president, a Republican, is pushing a state constitutional amendment that would not only institute a lottery, but also allow traditional slots and casino table games at several dog racing tracks across the state. The House Republican caucus, while supporting an array of limited tax increases, is championing a stunning and unexpected offer from the Poarch Band of Creek Indians, the state’s only federally recognized tribe: In exchange for a compact giving the tribe exclusive gambling privileges in Alabama at its three casinos, as well as setting aside land for a fourth, the tribe would foot the bill for nearly the entirety of next year’s state budget deficit. With Alabama facing a revenue shortfall of over $260 million — possibly far, far over depending on how one counts — Gov. Robert J. Bentley continues to insist that a package of tax increases is the only long-term answer. Some Republican leaders have weighed the taboos and, it appears, picked their poison. “Republicans, by and large, aren’t big advocates of gaming,” Del Marsh, the Senate president, said in an interview. “But they sure as hell don’t like taxes.” It was not that long ago that the state’s long, intrigue-filled war over gambling was still running hot. Image Joanne Zacharias and James Swanson at a Poarch Band of Creek Indians casino in Alabama. The tribe is offering a compact that would give the state $250 million up front. Credit William Widmer for The New York Times State officials, insisting that the proliferating electronic bingo devices around Alabama were actually illegal slot machines, raided and shut down booming racetrack resorts and small bingo halls. The state attorney general, a Republican, sued the Poarch Creek Indians in 2013 on similar grounds. Since late 2010, passels of lawmakers, lobbyists and casino operators have twice been rounded up on federal bribery and corruption charges, prompting back-to-back trials, both of which ended in a recitation of not-guilty verdicts. Internal memos of national Republican Party officials have been leaked describing how anti-gambling Republicans in Alabama secretly took campaign money from Mississippi casino interests. Wiretaps have been worn in the halls of the Alabama State House. Private investigators have tailed state officials. For some Republicans, gambling was worse than a mere vice: It was the domain of Democrats. The state’s last Democratic governor, Don Siegelman, campaigned on and unsuccessfully pushed for a lottery. The state’s racetrack kingpin, a gregarious self-made millionaire named Milton McGregor, has been among the state’s most generous Democratic campaign donors. “At the end of the day, I don’t know if they were really anti-gaming as much as pro-getting elected,” said Bobby Singleton, a Democratic state senator who welcomes the change of heart. But now the Republicans have won just about everything. And the revenue shortfall looms. Mr. Bentley, a Republican who won re-election last year promising no new taxes, has been barnstorming the state in recent weeks laying out the grim consequences of the shortfall. Hundreds of court employees could be laid off, thousands of families could lose state assistance, and most state parks could close. He insists that his proposed $541 million package of tax increases, mostly on cigarettes and car sales, is the only way to achieve fiscal sustainability. The plan had a cold reception in the Republican-dominated Legislature; the state party even passed a resolution rebuking it. But Mr. Bentley insists that there has yet to be a better proposal. Of the Senate president’s plan to expand gambling, the governor recently described it, according to The Montgomery Advertiser, as “the worst piece of legislation I have ever seen.” Mr. Marsh’s plan would legalize and tax so-called Class III gambling — traditional slot machines and table games — at several dog racing tracks around the state; allow the governor to enter into a separate compact with the Indian-owned casinos; set up a state lottery; and create a commission to regulate it all. Mr. Marsh acknowledged the surprising politics but pointed out that his draft bill includes language barring racetrack operators like Mr. McGregor from making campaign contributions (a similar bill was introduced in the House on Wednesday). And though, as the governor has pointed out, this plan might take some time to start paying dividends, Mr. Marsh insisted that it would create thousands of jobs while negating the need for tax increases. Image Del Marsh, the Alabama Senate president, is pushing a state constitutional amendment to institute a lottery and allow traditional slots and casino table games at several horse racing tracks. Credit Mickey Welsh/The Daily Advertiser, via Associated Press “I understand that people don’t view the lottery and gaming casinos as a conservative value,” said State Representative Corey Harbison, a Republican who expressed openness to some of the plans being discussed. “But people also don’t view tax increases as a conservative value. I’m open to lottery and gaming before I am a tax increase.” The Poarch Creek Indians were paying close attention. Business at their Creek casinos has boomed as competitors have been shut down. In recent years, Indian gambling revenue has grown faster in Alabama than in almost any other state, according to Alan P. Meister, the author of The Indian Gaming Industry Report. The tribe has built new restaurants, renovated casinos and in 2014, opened a 286-room hotel that features an enormous shark tank. Mr. Marsh’s bill, by opening up gambling around the state, would pose a huge threat. There had been some talk of a compact before, and it would not be rare: A number of states have entered into compacts granting gambling exclusivity to a tribe in exchange for annual payments to the state. But this proposal would be different; it would front-load those payments, roughly $50 million a year, in a $250 million sum that could help solve the current budget predicament. “We of course heard from state legislators that the deficit is constantly growing,” said Stephanie Bryan, the chairwoman of the tribe. “So there may be interest that there’s something that gaming can do for the state.” No one in the Legislature had even considered such a proposal until an executive with the tribe began floating it at several gatherings in recent weeks, including at a dinner meeting of the House rural caucus, where the idea took many aback. “I didn’t think anyone there at the time thought it was serious,” said Representative Randall Shedd, a Republican. The Poarch Creek proposal may be something of a defensive maneuver against Mr. Marsh’s proposed amendment, but it has a virtue that his bill lacks: It could produce the money immediately. Both are being taken seriously. Supporters of Mr. Marsh’s plan express unease at giving the Poarch Creek Indians a long-term monopoly on gambling and see it as shortsighted. Others, like the House leadership, see exclusivity as a selling point, a way to keep gambling contained and in the hands of a group that has shown it can prosper and regulate itself. Still, others are astonished to find what is going on in the Alabama State House. “I think the magnitude of the problem has a lot of people considering things they’ve never considered before,” Mr. Shedd said. “I’m shocked.”

Alabama
Gambling
Native Americans
Budget
Casino
Robert J Bentley
Del Marsh
Montgomery AL


Harvick's Gamble Plays Out Perfectly

Abstract: AVONDALE, Ariz., April 23 - If Kevin Harvick was worried during the final few laps of the Subway Fresh 500 Nascar race Saturday night, it was hard to tell. As other top drivers ran out of gas and sputtered out of contention behind him, and as the fuel gauge of his car signaled the approach toward empty, Harvick and his crew occupied themselves with another matter: specifically, the "Chicken Dance" song. The driver and members of his pit crew sang the song to one another over their two-way radio as Harvick cruised to his sixth Nextel Cup victory in his 186th start. "We do some stupid stuff on the radio," Harvick said. The G.M. Goodwrench Chevrolet crew had been singing the song all day and the melody stuck with them through the race, he said. As it worked out, Harvick won a game of chicken of sorts among the top drivers as the race ended under the night skies west of Phoenix. Harvick raced with the front pack most the race, then slipped ahead of Greg Biffle with 10 laps to go in the 312-lap race. The leaders were running low on fuel and all faced the same predicament: pit for gas or continue? Harvick conserved what little fuel was left in his tank. He eased up on the accelerator midway through the front and back stretches to coast into Turns 1 and 3 for the last six or seven laps. The strategy worked. Biffle's and Mark Martin's tanks went dry during the final three laps on the mile oval. That left Tony Stewart to challenge Harvick, but even with his conservative approach, Harvick kept a nearly three-second lead. Stewart finished second, followed by Matt Kenseth in third. Martin, who led for 111 laps, fell to 11th. Biffle, who led for a race-high 151 laps, dropped to 16th. "We didn't have the best car all night, but we had a solid car and sat there in third, fourth or fifth and kept adjusting on our car," Harvick said. "They made it right at the right time." The team introduced a new short-track chassis for the race, which started under hot, sunny skies and concluded more than 2 hours 54 minutes later on a cool night. Harvick has seen the best and the worst Phoenix International Raceway can offer. On Friday, he won the Bashas' Supermarkets 200 Busch Series race. A year ago in the Subway Fresh 500, he was racing in the top five when he ran out of gas and fell to 19th. He became the sixth winner in eight races in 2006 and is in eighth place in the season points standings, a point behind Dale Earnhardt Jr., who finished 23rd after his car was damaged in a multicar crash on Lap 224. SCHUMACHER WINS AT IMOLA AGAIN -- Michael Schumacher held off Fernando Alonso in a tight duel Sunday to capture a record seventh San Marino Grand Prix at Imola, Italy. Schumacher, driving a Ferrari, covered the 62 laps around the Enzo and Dino Ferrari circuit in 1 hour 31 minutes 6.486 seconds. Alonso was two seconds behind. Schumacher collected his 85th career victory and his first against a full field since the end of 2004. (He won the United States Grand Prix last year, when only six cars competed because of a tire dispute.) "We had an amazing weekend," said Schumacher, who earned the 66th pole position of his career Saturday to break the record he shared with Ayrton Senna. Alonso started five cars behind Schumacher. By the 35th lap, he was on Schumacher's tail but never found a way to pass him. (AP)

NATIONAL ASSN OF STOCK CAR AUTO RACING
HARVICK KEVIN
SUBWAY 500 (AUTO RACE)
AUTOMOBILE RACING


An iPad Misplaced at the Airport Takes Its Own Vacation

Abstract: Last month, Shelby Bonnie’s iPad vanished from his carry-on bag somewhere at Fort Lauderdale-Hollywood International Airport after a red-eye flight from San Francisco. He figured he would never see it again. But sometimes our devices aren’t ready to say goodbye. While Mr. Bonnie, an investment banker with Allen & Company, continued on his way to the Bahamas for a few days of relaxation, his iPad began a strange odyssey of its own, turning Mr. Bonnie into a digital gumshoe and the narrator of a personal thriller that played out on Facebook, to the delight of his online friends. “I said, ‘I’m definitely going to lose my iPad, but I’m going to have some fun,’” Mr. Bonnie said in a phone interview. The reason the iPad’s story didn’t end with its disappearance is a location tracking feature on Apple devices called Find My iPhone , which can be used to pinpoint any lost or stolen Apple device, including iPads and Macs. Others have used this capability to very publicly hunt down missing devices before, including David Pogue, a former technology reviewer for The New York Times who broadcast the hunt for his missing iPhone in Maryland to his Twitter followers. He eventually recovered the device with the help of the local police. When Mr. Bonnie discovered the iPad was missing after he left the Fort Lauderdale airport, he turned on Find My iPhone and saw that his tablet was at Elvis Presley’s Heartbreak Hotel at Graceland — in Memphis. The app represented the location of the device as a glowing green circle on an aerial map outside the hotel, with its distinctive heart-shaped pool. His best guess was that he had lost the iPad in the airport when he was stuffing a travel pillow back into his carry-on bag and that the device was now in the company of another traveler who had picked it up. That person had apparently decided not to turn in the device to the lost-and-found department at the airport. Through Find My iPhone, Mr. Bonnie sent a message, visible on the lock screen of the iPad, telling whoever had the device to call his cellphone for a reward. No one did. Over the next few days, Mr. Bonnie began providing regular updates on the iPad’s whereabouts to his friends on Facebook, providing screen shots from Find My iPhone that showed the device headed to downtown Memphis and at the Links at Riverside, a golf course. “IPad is on the move,” one of his updates said. Most of his posts got more than 100 likes on Facebook and dozens of comments, as Mr. Bonnie’s online acquaintances became more engaged in the story. “Please keep your fans informed as to the results of the mystery,” one commenter said. By coincidence, Mr. Bonnie nearly bumped into his iPad on a short layover from the Bahamas. As he waited at Concourse C at the Fort Lauderdale airport for a flight back to his home in San Francisco, he saw on Find My iPhone that his iPad was on an airplane approaching Concourse C. He quickly located the gate for an Allegiant Air flight arriving from Memphis and looked over the passengers disembarking from the plane. He remembered he could use Find My iPhone to trigger a distress signal on his iPad. He activated the feature, but heard no sound. He told his Facebook fans he was within 100 feet of the iPad. “This is better than ‘Game of Thrones,’” one commented. He concluded that the iPad must have been inside checked luggage that never entered the terminal. By the time he got to the correct baggage carousel the iPad had left the airport. “At some point it became more about the storytelling and less about the iPad,” said Mr. Bonnie, a co-founder of the technology news and reviews site CNET . “Everybody loves a good story. It’s more entertaining than getting the iPad back.” Mr. Bonnie saw an opportunity for mischief when the iPad finally seemed to stay put in a residential neighborhood in Miami Lakes, a suburb of Miami. On a map, it looked like a nice home with a swimming pool, Mr. Bonnie said. He boarded his plane to San Francisco, ordered in-flight Wi-Fi access and spent $50 to have five Mylar balloons delivered to the house the next morning. On the card, he listed the occasion as “Thinking of You.” “Friendly yet slightly creepy enough for them to want that iPad out of their house,” one of his Facebook friends said. A voice mail message left by a reporter for the phone number associated with the Miami Lakes address was not returned. The balloons appeared to have an effect. The next morning the iPad was on the move again — back to the Fort Lauderdale airport. Mr. Bonnie, in San Francisco, was watching the device traveling on the map when it occurred to him that whoever had it might be taking it to the airport’s lost and found. He went to the airport’s website and began filling out a missing item claim form when his phone rang. It was someone from lost and found. “As described by lost and found when they called a second ago, a fairly elderly woman came in a few minutes ago and said she had gotten the balloons and thought it would be a good idea to return the iPad to the airport,” Mr. Bonnie wrote in a Facebook post. “She said to thank me for the balloons, but she didn’t really want to call.” “Better than ‘Serial,’” a friend commented on Facebook. “Better than ‘This American Life.’ Better than everything.” Mr. Bonnie paid to have his iPad shipped home by UPS. He received it in San Francisco on Friday. He hung a banner saying “Welcome Home” on his front door.

iPad
Lost and Found
Shelby W Bonnie
Apple
Mobile Apps


Adobe Cuts Forecast as Users Migrate Online

Abstract: Adobe Systems , the maker of Photoshop and Acrobat software, said Wednesday that its earnings in its current quarter would decline or remain flat because customers have adopted the company’s new subscription-based model faster than expected. The company’s forecast, which disappointed Wall Street, came as Adobe reported revenue for its third fiscal quarter that was below analysts’ expectations. Adobe projected that its earnings in its fourth fiscal quarter would range from 53 cents to 58 cents a share, excluding onetime items, on revenue of $1.075 billion to $1.125 billion. That forecast was below analysts’ average estimate of earnings of 67 cents a share in the current quarter on revenue of $1.2 billion, according to the equity research firm StarMine, which gives more weight to estimates from analysts with better track records. These targeted ranges factor in 25,000 additional new Creative Cloud subscriptions in the quarter, the company said Wednesday. Adobe introduced its Creative Suite 6, which includes Photoshop, Illustrator, InDesign, Flash and Dreamweaver, and the Web-based Creative Cloud products in its second fiscal quarter in an effort to provide a more stable revenue model. Analysts have expressed concern that the Web-based Creative Cloud subscription service would hurt Adobe’s financial growth at least over the short term. Josh Olson, an analyst at Edward Jones, said Adobe’s fourth-quarter earnings and revenue targets indicated that the company’s transition to a more stable revenue model was happening faster than anticipated. “What happens with the subscription model is that revenue is recognized over time, so if adoption is faster there is more of a delay,” he said. “The long-term take-away is that it’s good thing.” Adobe reported net income for its third fiscal quarter of $201.4 million, or 40 cents a share, compared with $195.1 million, or 39 cents a share, a year earlier. Excluding onetime items, the company said it earned 58 cents a share in the most recent quarter. Adobe’s revenue totaled $1.08 billion in the third quarter, compared with $1.01 billion in the 2011 quarter. Wall Street expected revenue of $1.10 billion. Adobe said its revenue was pulled down by about $9 million because of currency fluctuations.

Adobe Systems Inc
Company Reports
Software
Computers and the Internet


India: Attackers Buried Secretly

Abstract: The bodies of 9 of the 10 Pakistani gunmen from the 2008 attack on Mumbai were buried in a secret location in January, a top state official said Tuesday. The bodies had been in the mortuary of a Mumbai hospital after Muslim clerics in the city refused to let them be buried on their grounds. The official, R. R. Patil, home minister of Maharashtra State, which includes Mumbai, told the state assembly about the burial.


Ferguson Is Expected to Hire Black Police Chief

Abstract: FERGUSON, Mo. — Nearly a year after the shooting death of a black teenager by a white police officer, the City of Ferguson is expected to hire a new, interim police chief who is black, a city official here said on Tuesday. The city is expected to announce soon that Andre Anderson, a police official from Glendale, Ariz., will lead the department, the official said. The city’s police department has been under intense scrutiny since the death of the teenager, Michael Brown, last August. The police chief, Tom Jackson, resigned this year after a highly critical assessment from the Department of Justice, and another interim chief has been holding the post.

Police Brutality,Police Misconduct,Police Shootings


Elderly Road Rage Over Transit for the Disabled

Abstract: It began four years ago when Florence Chasin’s 91-year-old husband grew so frail that a strong gust of wind would threaten to blow him over as he walked on the sidewalk near their Carnegie Hill co-op. Unable to use subways or buses and facing grave difficulties walking, he became a shut-in. Then, three years ago, the Chasins discovered Access-A-Ride, the city’s door-to-door transit program for the disabled. The couple began using the vans about four times a week, making reservations for trips to the doctor, the dentist and elsewhere for a fare of $2. “When they’re on time, it’s a wonderful convenience,” said Mrs. Chasin, an 89-year-old retired typographer who is not disabled but uses the service as her husband’s aide. “But very rarely do they come on time. You can sometimes wait 40 minutes, and they don’t show up.” Complaints about delays as well as missed pick-ups, overly complicated routes and an arduous application process inspired some members of the 60-Plus program at the 92nd Street Y to initiate a campaign this month to improve Access-A-Ride. The service, with 1,700 vehicles run by private contractors, has an average of 15,000 weekday riders. In the coming months, the group intends to join forces with other senior centers and organizations to distribute surveys and conduct interviews assessing the transit service. The group plans to present findings to Access-A-Ride supervisors and identify ways to improve the service, which began in 1989. High among their criticisms is a new application process that went into effect in March, requiring that all applicants be assessed at a certification site. The assessment includes interviews about the applicant’s disability and sometimes a request to climb mock bus steps. The process, these critics say, is unduly onerous for people with acute disabilities. Officials with the paratransit division of New York City Transit, which oversees Access-A-Ride, said the service has an on-time performance of 94 percent. They also said that to help drivers get to destinations in a timely fashion, they are equipping 12 vehicles with global positioning systems this month, and G.P.S. systems will eventually be installed for the entire fleet. As for the application process, transit officials said the certification requirement was set up in part so all applicants received fair and uniform consideration. That explanation is little consolation to Sylvia Cohen, 80, chairwoman of the 92nd Street Y committee leading the campaign. “Sitting there being observed and viewed is an indignity,” Ms. Cohen said. “The system was bad enough before, and to add this extra burden is very disturbing.”


Putting Their Houses in Order

Abstract: Are Fannie Mae and Freddie Mac nearly insolvent, as some investors and policy makers fear? Or are the giant mortgage finance companies sound — and good investments, as others contend? Those questions reverberated through Wall Street and Washington on Friday, when the two companies’ shares fell yet again in a day of wild swings that left investors fearful of what might happen next. But the questions are difficult to answer with any certainty because of the size and complexity of Fannie Mae and Freddie Mac, companies that lie at the heart of the nation’s housing market and touch nearly one out of every two home mortgages. Wall Street analysts disagree over how high the companies’ losses will mount as home prices decline further and foreclosures grow, an outcome that depends on the course of the housing market and the broader economy. Analysts also differ over what would happen if those losses were to overwhelm the companies, possibly leading to a rescue by the federal government that would be paid by taxpayers. “The real problem is that nobody really knows how bad things will get,” said Thomas H. Stanton, an expert on the two companies who teaches a course on credit risk at Johns Hopkins University. “Everyone thought these guys were the best in the market at evaluating mortgages, so they let them skate by with huge debts and tiny financial cushions,” Mr. Stanton said. “But now it’s less clear they knew what they were doing, and it’s really hard to know who’s right and who’s selling pipe dreams and then hoping for the best.” Friday’s market gyrations capped one of the most nerve-racking weeks on Wall Street since Bear Stearns collapsed into the arms of JPMorgan Chase in March. In recent days senior Bush administration officials disclosed a plan that would have the government take over one or both of the companies if they faltered. Minutes after trading opened Friday morning, the companies’ shares plunged 50 percent. The shares then seemed to stabilize before rising and falling in a series of gut-wrenching waves. Freddie Mac ended the day at $7.75, down 3 percent, and Fannie Mae closed at $10.25, down 22 percent, rewarding both investors who bet on and against the enterprises during the course of the volatile day. Supporters of Freddie and Fannie insisted that the worries over the companies’ future were overblown. In Washington, Treasury Secretary Henry M. Paulson Jr. and members of Congress voiced confidence that the companies were healthy. On Wall Street, Citigroup broke with the prevailing public view among major investment houses, which mostly recommend that investors avoid Fannie and Freddie shares, and issued a report recommending that people buy them. Freddie and Fannie buy mortgages from banks and other lenders. Sometimes they keep those mortgages as investment — as of May, the two companies held mortgages worth about $1.5 trillion. Other times, they repackage the mortgages for sale to investors, along with a guarantee that Freddie and Fannie will pay off the loan if the homeowner defaults. The companies have guaranteed mortgages worth about $3.9 trillion. Among those who see trouble on the horizon, the prevailing concern is that Freddie and Fannie have vastly underestimated how many bad loans they have bought, and that as borrowers default, the companies will start hemorrhaging money. “Odds are that things are going to get worse, and so far, no one has done a good job of estimating how bad they will get,” said William Poole, the former president of the Federal Reserve Bank of St. Louis. “By some methods of accounting, these companies have already reached zero value, or are almost there.” The companies themselves acknowledge that they bought many bad loans. In the past nine months, they have reported losses of more than $8 billion, and have estimated that those losses would grow by as much as $24 billion in the next few years. The firms estimate home prices will decline 7 percent to 9 percent over that period. Skeptics, however, maintain that even those dour forecasts are too optimistic. Ron Torrens, an analyst at the independent research firm BCA Research, estimates the companies’ losses in 2008 and 2009 will total $52 billion. Other analysts have forecast losses in the next two years of as much as $100 billion. In the worst-case situation, if the housing market were stagnant for years, total losses at Fannie and Freddie could reach $300 billion, or almost five times what the federal government spent on education last year, some analysts have predicted. If taxpayers were ever forced to guarantee the companies’ debts and obligations, they could be on the hook for that money. “The housing market is going to continue getting worse for years, and the losses are going to build and build,” said Steve Persky, chief executive at Dalton Investments in Los Angeles. Mr. Persky did not estimate Fannie’s and Freddie’s losses. “Every time someone has tried to put a number on how much mortgage assets will decline, the market has proven that things are worse than they imagined,” he added. But Fannie and Freddie and their supporters say such pessimism is unwarranted. Supporters note that the companies have on hand more than $90 billion in reserves and funds they are required to hold by their regulator, and billions of dollars in revenue come in every year. “These companies have their choice of the best loans right now, and we project they take in $8 billion to $10 billion of revenue each year, so they have more than enough revenue to offset their losses,” said Howard Shapiro, an analyst at Fox-Pitt, Kelton, who estimates the companies will lose no more than a combined $40 billion during the next five years. Whatever their losses, the companies will almost certainly need to raise additional money from investors before the end of the year. That will be difficult, however, given the uncertainty hanging over the companies. By law, Freddie and Fannie must hold a certain amount of so-called core capital in reserve, or else the government effectively takes control of the companies. Currently, the companies are required to hold about $70 billion in core capital. In his most recently released report, the companies’ regulator, James B. Lockhart, said they held $81 billion at the end of March. But as Fannie and Freddie suffer losses, their core capital declines. To stay above the required levels, they must raise new funds to offset losses, or else they risk a regulatory takeover. The companies can raise money by selling new stock. But with their stock prices so low, they would have to issue millions of new shares to raise just $1 billion. As those millions of new shares are created, they depress the price of all the shares in the marketplace, creating a downward spiral that makes it harder and harder to raise money. Some onlookers are betting the government will step in and give the firms a cash infusion of taxpayer dollars. But in this market, nothing is certain. “Everyone is playing a dangerous game right now,” Mr. Persky said. “And there’s no clear evidence that anyone has consistently gotten it completely right.”

Wall Street (NYC)
Mortgages
Finances
Housing
Foreclosures
Freddie Mac
Fannie Mae