"And then on that Monday [October 6] and Tuesday it was not possible even for THOSE TWO BANKS REALLY TO BE CONFIDENT THEY COULD GET TO THE END OF THE DAY." Their liquidity problems, which brought the UK financial system close to collapse, resulted in a £50bn bank bailout by the British taxpayer.

Mr King describes the consequences of letting the banks fail. "Individuals would not have had access to the money in that bank. Their deposits would have been frozen. The accounts would have not been there for salaries to be paid in to, so many people would not have been paid their salary. In turn, they wouldn't have been able to pay bills to businesses so the businesses would have found that their flow of payments would have come to an end."

Baroness Shriti Vadera, the Business Minister who called a meeting of bankers on October 7 last year to advise the government on a bailout, told the programme: "IT DOES MAKE MY BLOOD RUN COLD TO THINK OF HOW CLOSE THE WHOLE GLOBAL SYSTEM WAS TO COLLAPSE." David Soanes, managing director of UBS Bank, who was part of the group brought together by Baroness Vadera, describes the desperate struggle to keep banks from going bankrupt on Tuesday, October 7, 2008.

"We only really knew by probably about seven o'clock at night, that we, that everyone was going to get through to the next day", he said. Ed Lazear, chairman of President Bush's council of economic advisers, says in the programme: "We literally thought that we were on the verge of the great depression and I, looking back I think we probably were".

"The dollar looks awfully like sterling after the First World War," said David Bloom, the bank's currency chief. "The whole picture of risk-reward for emerging market currencies has changed. It is not so much that they have risen to our standards, it is that we have fallen to theirs. It used to be that sovereign risk was mainly an emerging market issue but the events of the last year have shown that this is no longer the case. Look at the UK – debt is racing up to 100pc of GDP," he said.

Crucially, China and rising Asia have reached the point where they can no longer keep holding down their currencies to boost exports because this is causing mayhem to their own economies, stoking asset bubbles. Asia's "mercantilist mindset" of recent decades is about to be broken by the spectre of an inflation spiral.

The policy headache was already becoming clear in the final phase of the global credit boom but the financial crisis temporarily masked the effect. The PRESSURES WILL RETURN WITH A VENGEANCE AS THESE COUNTRIES ROAR BACK TO LIFE, leaving the US and other laggards of the old world far behind.

Brzezinski's payoff after Carter was swept into power was being named national security adviser. HE PRESIDED OVER ONE FOREIGN-POLICY FIASCO AFTER ANOTHER – the Soviet invasion of Afghanistan, the Iranian revolution, the US Embassy takeover in Tehran, the failed rescue of the hostages in the embassy and so on. Now Brzezinski is back with more advice. HE SUGGESTS THE US MILITARY SHOOT DOWN ANY ISRAELI JETS HEADED TO ATTACK IRAN'S NUCLEAR FACILITIES. What's so bizarre about this advice is that the US has abdicated its own responsibility to protect its own civilians from the strong possibility of a nuclear attack by Iran or its proxy terrorist armies.

Remember, Iran's mullah leadership has long stated their simple view of the world and their enemies: ISRAEL IS THE "LITTLE SATAN." AMERICA IS THE "GREAT SATAN." While it's true that Iranian President Mahmoud Ahmadinejad has made clear over and over again his determination to destroy Israel, to wipe it off the face of the earth, MANY HAVE MISSED HIS STATED GOALS OF BRINGING DOWN AMERICA AS WELL. It isn't just a world without Zionism and Israel that Ahmadinejad and his friends in Hamas, Hezbollah, Islamic Jihad and other terrorist groups are envisioning. IT IS A WORLD WITHOUT THE UNITED STATES OF AMERICA.

"Is it possible for us to witness a world without America and Zionism?" he asked. "But you had best know that this slogan and this goal are attainable, and surely can be achieved." I am convinced Ahmadinejad hasn't changed. I think he represents the view of the ayatollahs who have run Iran since 1979. THEY DON'T SIMPLY WANT TO DESTROY ISRAEL. THEY WANT TO DESTROY AMERICA. I'm not even sure Iran would ever use nuclear weapons on Israel. If it did, it would surely kill nearly as many Muslims, including some of its closest allies in Hamas and Hezbollah, as Jews. Of course, if I were the prime minister of Israel, I wouldn't bet my life on that.

BUT I'VE ALWAYS BELIEVED IRAN WANTED NUCLEAR WEAPONS TO TAKE ON THE US – not necessarily to deliver with intercontinental ballistic missiles, but, more likely, on the backs of terrorist mules entering the US covertly or fired from a cheap Scud just offshore and detonated at high altitude, creating a devastating electro-magnetic pulse that could cripple America's infrastructure.

However there is no rail link between the mine and the Brecon Mountain Railway, so the local coal cannot be used. The Siberian coal is shipped to the UK, then moved in containers to Hull, after which it is transported by road to Merthyr Tydfil.

Jayne Hills, the tourist railway's owner, told The Telegraph the regulations were particularly annoying as the local coal would be ideal for use in the newly converted steam locomotive. 'IT SEEMS LUDICROUS THAT WE COULD GET COAL FROM THREE MILES AWAY BUT INSTEAD ARE BEING FORCED TO IMPORT IT FROM 3000 MILES AWAY. Being from Merthyr, where everyone has a relative who was a coal miner, or knew somebody who was a miner, this seems just crazy.'

According to The Telegraph, planning permission for the mine had stipulated coal could only be transported by rail after residents voiced concerns about noise and dust coming from the mine. Up to 20,000 tonnes of coal is dug every week at the mine, with most of it going to the Abethaw power station in the Vale of Glamorgan. The mine's operator is now applying to change the planning conditions so that five per cent of its coal can be taken out on lorries.

"I told Abu Mazen I believe peace hinges first on his readiness to stand before his people and say, 'We are committed to recognizing Israel as the nation-state of the Jewish people'," Netanyahu told Israel Radio in an interview aired Thursday, referring to President Mahmoud Abbas.

"I WILL NOT DROP THIS SUBJECT AND OTHER IMPORTANT ISSUES UNDER ANY FINAL PEACE AGREEMENT," Netanyahu said. US President Barack Obama Tuesday brought the Israeli and Palestinian leaders together for the first time since Netanyahu came to power in March and urged them to revive stalled peace negotiations soon. THE PALESTINIANS HAVE REJECTED ISRAEL'S DEMAND THAT THEY RECOGNIZE IT AS A JEWISH STATE. They say Israel should meet its previous commitments to fully halt settlement activity in the occupied West Bank before talks can resume.

Netanyahu will address the United Nations General Assembly in New York Thursday and Israeli officials say his speech will focus on Iran's disputed nuclear program, which Israel deems as a threat to its existence.

US President Barack Obama and his counterparts from the Group of 20 nations meet in Pittsburgh today warning that the recovery is still too weak to start reversing lifelines to banks and the broader economy. THEIR NEXT CHALLENGE WILL BE TO REDUCE THE RESULTING DEBT BEFORE IT SPARKS HIGHER BOND YIELDS AND ERODES THEIR GOVERNMENTS' CREDITWORTHINESS.

"There's no question that the most significant vulnerability as we emerge from recession is the soaring government debt," said Harvard University Professor Kenneth Rogoff who is a co-author of a new history on financial crises. "IT'S VERY LIKELY THAT WILL TRIGGER THE NEXT CRISIS AS GOVERNMENTS HAVE BEEN STRETCHED SO WIDE."

Unwinding the borrowing will probably require leaders to raise taxes and cut spending, ushering in what HSBC Holdings Plc Chief Economist Stephen King calls an "AGE OF AUSTERITY" that saps growth prospects for years to come even amid recovery.

Six months after proclaiming a new commitment to the war in Afghanistan, President Barack Obama is under growing pressure to make what would amount to a U-turn in US policy and scale back America's commitment to a conflict that many experts – and a majority of the public – now fear may be unwinnable.

The debate, which divides Mr Obama's most senior advisers, was thrown into stark relief by the leaked report of General Stanley McChrystal, the commander of US and allied forces in Afghanistan, WARNING THAT THE WAR MIGHT BE LOST WITHIN A YEAR without a further boost in troop strength and a major change in strategy to combat the spreading Taliban insurgency.

The stakes are now huge – so huge that the President barely mentioned Afghanistan in his address to the United Nations General Assembly yesterday. IF WASHINGTON IS PERCEIVED AS OPPOSING A FURTHER TROOP BUILD-UP, or leaning towards a reduction, THEN OTHER COUNTRIES IN THE COALITION, where the eight-year-long war is even more unpopular than here, WILL RUSH FOR THE EXITS.

He claimed greater global freedom and the "awakening of nations" would force Israel to abandon its "hypocrisy and vicious attitudes. It is no longer acceptable that a small minority would dominate the politics, economy and culture of major parts of the world by its complicated networks, and establish a new form of slavery, and harm the reputation of other nations, even European nations and the US, to attain its racist ambitions," he said.

British delegates joined American and French representatives in leaving the room at the UN headquarters at this point. A spokeswoman for the UK delegation said the walk-out was prompted by "anti-Semitic" rhetoric.

However, the president held private meetings with the leaders of Japan, China and Russia. Downing Street said reports of a snub were "completely without foundation". A spokesman said the men had had a "wide-ranging discussion following last night's climate change dinner". IT HAS EMERGED THIS WAS A FEW MINUTES OF CONVERSATION IN A KITCHEN AT THE UNITED NATIONS.

However, a British diplomat told The Daily Telegraph that the White House's refusal to meet Mr Brown had been a serious embarrassment for the Prime Minister. "It is wrong for people to say that we have been relaxed about the way things have gone," the source said. "THERE WERE FIVE ATTEMPTS TO SET UP A MEETING AND NONE HAVE COME OFF."

Though markets and the economy are improving, efforts to provide a firm foundation for recovery will require increases to the US Treasury's conventional bonds going forward, as well as debt securities that are indexed to inflation. However, this expansion may take place in an environment WHERE INVESTORS CONSIDER LEAVING THE SAFE-HAVEN TREASURY MARKET FOR RISKIER ASSETS, and debt issuance is likely to level off mid next year, said Treasury Acting Assistant Secretary for Financial Markets, Karthik Ramanathan.

"In fiscal year 2009, which ends next week, TREASURY WILL HAVE ISSUED $7 TRILLION IN GROSS ISSUANCE - that's in a 12-month period," Ramanathan told a financial markets conference in New York. "This issuance was necessary to meet nearly $1.7 trillion in net marketable borrowing needs, nearly $1 trillion more than what we raised last year," he added.

As in the past, al-Qaida attempted to conflate Obama with his predecessor, George W Bush, who was widely disliked by Muslims for his invasions of Afghanistan and Iraq. Many analysts believe that al-Qaida has been alarmed by Obama's comparative popularity in the Middle East, especially following his landmark speech to the Muslim world in Cairo in June.

"America has come in a new, hypocritical face. Smiling at us, but stabbing us with the same dagger that Bush used," said Al-Qaida No 2 Ayman al-Zawahri in the message. "GOD WILLING, YOUR END WILL BE AT THE HANDS OF THE MUSLIM NATION, so that the world and history will be free of your crimes and lies," he said addressing Obama at the end of the two-part video.

The video's strident anti-American tone and detailed enumeration of what it describes as the US crimes was in sharp contrast to the earlier bin Laden message, which appeared to be an appeal to the American people to sever their ties with Israel and end the war with al-Qaida.

Iranian President Mahmoud Ahmadinejad last week offered a new assessment of the Holocaust - it is a lie - and of Israel's future prospects - it will soon be removed. This came as an unwelcome reminder to the Obama administration, and to the rest of the watching world, that THE UNITED STATES WOULD BE SITTING DOWN IN THE COMING WEEKS WITH A HOLOCAUST DENIER BENT ON NUCLEAR WEAPONIZATION. We trust the Americans will try nobly to convince Mr Ahmadinejad to do otherwise. But in between his launching of new uranium enrichment centrifuges and the arrest and torture of regime opponents, we sadly doubt the Iranian president will be persuaded.

In Afghanistan, Obama may be demonstrating some steely reserve, perhaps forced into it by the harsh reality of American blood on the line. This is commendable. It is less commendable that the administration cannot bring itself to reject outright last week's Goldstone Report, which condemns Israel for military actions both less severe and less numerous than those of American troops in Afghanistan, and does so on the basis of a grave misrepresentation of what unfolded in Gaza at the turn of the year.

It decimated the initial goodwill and admiration Obama enjoyed among the Israeli public by instigating a diplomatic crisis over something called "a stop to settlements... without exceptions." THIS ABSOLUTE DEMAND WAS ALWAYS UNREALISTIC AND THEREFORE COUNTERPRODUCTIVE. Hundreds of children are born each year in the suburbs of Jerusalem that step over the 1949 Green Line. Was the Jerusalem Municipality being asked to cease construction of kindergartens for them? Until the administration folded on this issue in July, the answer seemed to be yes.

By ratcheting up his demands of Israel beyond the point of viable agreement, and then FAILING TO OBTAIN ANY SUBSTANTIVE CONCESSIONS FROM ARAB LEADERS OR THE PALESTINIANS IN EXCHANGE, Obama actually walked into the most basic of Middle East peacemaking traps - encouraging the instinctive Arab resort to intransigence. After all, how could the Palestinians now demand less of the Israelis than the Americans? AND WITH A FULL-BLOWN DIPLOMATIC CRISIS APPARENTLY UNDER WAY BETWEEN ISRAEL AND AMERICA, WHAT INTEREST COULD ARAB LEADERS HAVE IN ENDING THE CRISIS THROUGH A DIPLOMATIC BREAKTHROUGH?

We might well ask why the administration is convinced that peace is being held up by settlements. Dozens of settlements have been dismantled and tens of thousands of settlers have been resettled in the Israeli withdrawals from Gaza and Sinai, while Palestinian rejection has only increased in response to apparent Israeli weakness. IN A WORLD THAT IS WONDERING INCREASINGLY WHETHER WASHINGTON IS WILLING AND ABLE TO ENFORCE ITS KEY VALUES AND EFFECTIVELY PROMOTE ITS VITAL INTERESTS, Obama plays host to Prime Minister Binyamin Netanyahu and Palestinian Authority President Mahmoud Abbas. And they will both be asking themselves a question neither would have anticipated eight months ago: CAN AMERICA BE RELIED UPON AND TAKEN SERIOUSLY?

THE SAUDIS TWICE SAID NO to his request for normalization gestures towards Israel (at Barack Obama's meeting with King Abdullah in Saudi Arabia, and in Washington at meetings with Hillary Clinton). Who says no to the American president twice? What must they think of Obama in the desert kingdom?

THE NORTH KOREANS SAID NO to repeated attempts at talks, by test-launching long-range missiles in April; RUSSIA AND CHINA KEEP ON SAYING NO to tougher sanctions on Iran; THE IRANIANS KEEP SAYING NO to offers of talks by saying they're willing to talk about everything except a halt to uranium enrichment; PALESTINIAN AUTHORITY PRESIDENT MAHMOUD ABBAS IS SAYING NO by refusing to meet with Binyamin Netanyahu until Israel freezes all settlement construction; THE ISRAELIS SAID NO by refusing to agree to a settlement freeze, or even a settlement moratorium until and unless the Arabs ante up their normalization gestures. Which brings us back to the original Saudi no.

The only thing Obama did manage to get Bibi and Abbas to say yes to is a photo-op at the Waldorf Astoria hotel in New York. Mazel tov. So why is everyone saying no to Obama? It's the economy, stupid.

Everyone has worked it out by now: The great secret is out. America's economy has made Obama a weak president, and he will likely remain weak throughout his first term. He has about two years to pull the American economy out of its free-fall before he begins his re-election campaign. If he can do it, and that's a big if, chances are good that he'll get re-elected, and in his second term he can try to pull some geopolitical strings. BUT FOR THE NEXT THREE YEARS, EXPECT TO SEE A WORLD THAT SAYS NO TO OBAMA. NO MEANINGFUL AND DRAMATIC DIPLOMATIC INITIATIVE CAN COME OUT OF THE WHITE HOUSE IN THE NEXT THREE YEARS, as long as Obama remains weak.

Much hope has been invested in Barack Obama's ability to strike a new course for the US following eight years of Bush administration unpopularity. Yet many in the US and abroad are impatient with the pace of progress under the Obama administration. The president made the rounds on five news talkshows on Sunday as he pressed his policies and vision, preparing for what is likely to be a difficult week.

Besides the ongoing battle over healthcare, this week SEES TWO SHOWDOWNS BETWEEN EUROPE AND THE US THAT WILL REVEAL FURTHER SLIPPAGE IN AMERICAN GLOBAL LEADERSHIP. The first showdown comes today at a UN special session on climate change in New York City; the second will come at the end of the week at the G20 meeting in Pittsburgh, where AMERICA AND EUROPE WILL BUTT HEADS over financial system reforms designed to ensure that the AIGs of the world can never again cause an economic collapse.

EUROPE HAS BEEN INCREASINGLY CRITICAL OF AMERICA'S FAILURES TO LIVE UP TO ITS GLOBAL RESPONSIBILITIES. The US is not only the world's largest emitter of greenhouse gases but is by far the largest per capita emitter of carbon and other pollutants. In response to American foot-dragging, European leader Jean-Claude Juncker said Europe should act on the bonus issue "whether the Americans are with us or not." He said that a Europe-only charge "will take on such force over time that the Americans will not be able to sit on the sidelines."

THE VERY STRUCTURE OF THE AMERICAN POLITICAL SYSTEM IS AT THE HEART OF THESE FAILURES. For example, thwarting Obama on a regular basis is an unrepresentative senate where "minority rule" prevails and undermines what a majority of the country may want. With two senators elected per state, regardless of population, California with more than 35 million people has the same number of senators as Wyoming with just half a million residents. This constitutional arrangement greatly favours low population states, many of which tend to be conservative, producing what one political analyst has called "a weighted vote for small-town whites in pickup trucks with gun racks."

In addition, the senate's use of that arcane rule known as the "filibuster" means you need 60 out of 100 votes to stop unlimited debate on a bill and move to a vote. A MERE 41 SENATORS, REPRESENTING AS LITTLE AS 20% OF THE NATION'S POPULATION, CAN STYMIE THE OTHER 80%. Given a vastly unrepresentative senate wielding its anti-majoritarian filibuster, it is hardly surprising that minority rule in the senate consistently undermines majority rule, whether on healthcare, financial industry reform, environmental legislation and many other policies.

Pile on to that an uncompetitive, winner-take-all electoral system, MARINATED IN MONEY AND SPECIAL INTEREST INFLUENCE, and the sclerotic US political scene is deeply troubling. None of these anti-democratic structural features are going away any time soon. Unless Barack Obama is able to demonstrate a better level of political skill than he has shown so far, everyone needs to fasten their seatbelts. The world is about to enter a challenging phase WHERE THE US – THE UNDISPUTED LEADER OF THE FREE WORLD FOR THE PAST 60 YEARS – IS GOING TO RAPIDLY CEDE ITS PLACE AT THE HEAD OF THE LINE.

IT APPEARS THAT THE WHEELS MAY BE COMING OFF THE WORLD'S POST-WAR LEADER, and not even Barack Obama can stop it happening.