UK - UK policymakers must act to cool rapid house price growth in London and prevent Britons from taking on sky-high debts that they may not be able to afford once interest rates rise, the European Commission has warned. Record low interest rates combined with a lack of housing supply had pushed up property prices across London and the South East, it said on Monday. This had led Britons to take on bigger mortgages, pushing up overall household indebtedness. “The United Kingdom continues to experience macroeconomic imbalances, which require monitoring and policy action,” the EC warned in its annual review of the UK. “The risks in the housing sector relate to a continuing structural undersupply of housing; intrinsic supply constraints, particularly in London, and the relatively slow response of supply to increases in demand continues to drive house prices higher.”

USA – Google plans to spend more than $1 billion on a fleet of satellites to extend Internet access to unwired regions of the globe, people familiar with the project said, hoping to overcome financial and technical problems that thwarted previous efforts. Details remain in flux, the people said, but the project will start with 180 small, high-capacity satellites orbiting the earth at lower altitudes than traditional satellites, and then could expand. "Google and Facebook are trying to figure out ways of reaching populations that thus far have been unreachable," said Susan Irwin, president of Irwin Communications Inc, a satellite-communications research firm. "Wired connectivity only goes so far and wireless cellular networks reach small areas. Satellites can gain much broader access."

UK - Destroy the market's ability to price assets, risk and credit, and you take away the essential information participants need to make rational, informed decisions. A correspondent recently summarized why unintended consequences eventually destroy all politically expedient strategies that temporarily prop up a systemically unsustainable Status Quo: "Unintended consequences almost always equal or exceed the benefits of whatever your temporary gains were in a complex system. We see this over and over again, in all sorts of different complex systems." In other words, all the "kick the can down the road" strategies being deployed across the globe by central states and banks will inevitably backfire because central planning fixes always trigger systemic consequences that were unintended by the planners, who are fixated on minimizing the political pain of powerful constituencies, not understanding or repairing the real problems.

ISRAEL - The Israeli education system has joined the majority of the Western world in introducing the theory of evolution to middle-school pupils beginning in the next academic year, it was announced on Sunday. The professional committee in the Education Ministry made the decision to introduce the theory of evolution to seventh grade through ninth grade pupils across the education system – in secular state schools, state-religious schools and Arab schools. “For years, since the 1980s, evolution was only touched upon in some middle schools, depending on if the teacher felt comfortable tackling such a heavy subject,” committee chairwoman Professor Nava Ben-Zvi told The Jerusalem Post on Sunday. Regarding any opposition by ultra-Orthodox or religious factions, Ben-Zvi said she did not see “any need for resistance” from these sectors. “We are not fighting the links,” she said “but science is science and the time has come to incorporate the study into the curriculum,” she said.

UK - David Cameron will meet Vladimir Putin for face to face talks on the Ukraine crisis on Friday, as world leaders scramble to defuse the internal conflict raging in the former Soviet republic. The meeting in France will come a day after a G7 meeting in Brussels from which Mr Putin has been excluded, Downing Street said. The G7 meeting will be dominated by Ukraine, with leaders discussing how to defuse the crisis and free themselves from energy dependence on Russia. A host of world leaders, including the Russian president, will gather in France on Friday to mark the 70th anniversary of the D-Day landings. But commemoration of the shared endeavour against the Nazis will be tainted by the Ukrainian crisis, with Western leaders including Mr Cameron, Barack Obama, and Francois Hollande, the French president, expected to take issue with the Russian leader.

BERLIN, GERMANY - The German government says Chancellor Angela Merkel will meet Russian President Vladimir Putin on the sidelines of this week’s commemoration of the 70th anniversary of the D-Day landings. A government spokeswoman said Merkel and Putin discussed the situation in Ukraine over the telephone Tuesday and agreed to continue the talks Friday, when both leaders will attend the commemoration of the D-Day landings that led to Allied victory in World War II. Speaking on condition of anonymity in keeping with government rules, she said the talks would concentrate on measures that could stabilize the situation in Ukraine. Merkel noted that she has spoken regularly with Putin over the telephone since the Ukraine crisis erupted and said “what I have to say isn’t influenced by whether it’s over the phone or directly.”

USA - John Amble, a former United States Army officer writes: Last week, President Obama gave what was billed as one of the most momentous foreign policy addresses of his presidency. He was expected to lay out his vision for America’s next chapter on the world stage. Much ink has been spent in seeking to define, defend, and disparage the Obama Doctrine over the past five and a half years. But as we approach the midpoint of his second term, and even after this much-heralded speech, I still don’t know what it is.

SPAIN - It is the end of a remarkable era. King Juan Carlos, the man who steered Spain to democracy but seemed to forget that, at least morally, a constitutional monarch can be held to account by his people, announced his abdication today after 39 years on the throne. The decision caught Spaniards by surprise, even though rumours had been circulating for more than a year that the king realised he had made too many mistakes and was too tired to resolve a situation that is of his own, and his family's, making.

FRANCE - The European election results showed euroscepticism rising across most of Europe. But the really shocking factor for the euro elites should have been the strength of the vote for the Front National in France. For the EU’s history – and its future – turns on France. The EU was first imagined and constructed by two Frenchmen, Jean Monnet and Robert Schuman, whose priorities were to end the age-old enmity between France and Germany and prevent another European war. The essential idea was to tie Germany into some European political entity.

MIDDLE EAST - After seven years of a bitter and at times lethal rivalry between the two main Palestinian factions, Fatah and Hamas, a historic Palestinian unity government has been sworn in, ending years of division. The signing ceremony, which seems likely to complicate relations with the Palestinian Authority's international aid donors in Europe and the US and increase tensions with Israel, was broadcast live in both Gaza and the West Bank.

GERMANY - Widespread gains in Germany’s neighbouring countries for anti-EU parties in Sunday’s elections have shaken staunchly pro-European Germany, sparking fears in the country of a "dangerous divide" in Europe. It's lonely at the top, at least for the German pro-Europeans of Chancellor Angela Merkel's ruling CDU/CSU/SPD coalition. After a strong endorsement from the German public at the weekend they will return to the European Parliament far stronger than centrist parties in other EU countries.

GERMANY - Germany's weapons industry is booming, and even the vice chancellor's attempt to stop selling tanks to the Saudis is a minor concession for the world's third biggest arms exporter. But the trade is destabilizing security. Germany opposed the war in Iraq and its troops deployed in the NATO mission in Afghanistan were mainly kept out of combat. Last month's decision to take part in the European Union's peace-keeping in the Central African Republic was made only on the condition that Germany's main contribution be medical transport planes.

USA - When an economy is healthy, there is lots of buying and selling and money tends to move around quite rapidly. Unfortunately, the US economy is the exact opposite of that right now. In fact, the velocity of M2 has fallen to an all-time record low. This is a very powerful indicator that we have entered a deflationary era, and the Federal Reserve has been attempting to combat this by absolutely flooding the financial system with more money. This has created some absolutely massive financial bubbles, but it has not fixed what is fundamentally wrong with our economy. On a very basic level, the amount of economic activity that we are witnessing is not anywhere near where it should be and the flow of money through our economy is very stagnant. They can try to mask our problems with happy talk for as long as they want, but in the end it will be clearly evident that none of the long-term trends that are destroying our economy have been addressed.

RUSSIA/CHINA - During Russian President Vladimir Putin’s visit to China last week, China and Russia signed a huge natural gas deal that is worth about $400 billion. The natural gas deal is a win-win for China and Russia, as China secures a long-term (30 years) provision of natural gas from Russia and Russia can reduce its dependence on the European markets as well as strengthen Russia’s position against Western sanctions. In the meantime, China and Russia conducted a joint naval drill in East China Sea, sending a deterrence message to Japan and the US.

USA - The US military's F-35 Joint Strike Fighter aircraft is proving to be a pain in the neck in more ways than one. Not only did the Pentagon spend almost $400 billion to buy 2,400 aircraft - about twice as much as it cost to put a man on the moon - the F-35 program is 7 years behind schedule and $163 billion over budget. This at a time when cuts in the defence budget are forcing the Pentagon to shrink the size of the military. This is… one of the biggest ongoing budget debacles in US military memory.