INDICATING THAT THE RATE OF OUTPUT DECLINE IS "ACCELERATING", the NIESR now expects a fall of more than 1% in the last three months of the year. Official data showed that the economy shrank 0.5% from July to September. But it will not be until January that the Office for National Statistics reports on the final quarter's GDP. If it reports a decline for the three months to December, then the UK will officially be in recession under the generally accepted definition of two consecutive quarters of decline.

The Organisation for Economic Co-operation and Development (OECD) also warned last week that the UK FACES A "SEVERE" ECONOMIC DOWNTURN IN 2009. The Paris-based body predicted that economic output in the UK will fall by 1.1% next year, more than any other major G7 country. It added that UNEMPLOYMENT IN THE UK WILL LIKELY RISE SIGNIFICANTLY TO OVER 8% BY END OF 2009 from 5.5% in 2008.

PHONE BUYERS WOULD HAVE TO PRESENT A PASSPORT OR OTHER OFFICIAL FORM OF IDENTIFICATION AT THE POINT OF PURCHASE. Privacy campaigners fear it marks the latest government move to create a surveillance society. A compulsory national register for the owners of all 72m mobile phones in Britain would be part of a much bigger database to combat terrorism and crime. Whitehall officials have raised the idea of a register containing the names and addresses of everyone who buys a phone in recent talks with Vodafone and other telephone companies, insiders say.

THE MOVE IS TARGETED AT MONITORING THE OWNERS OF BRITAIN'S ESTIMATED 40M PREPAID MOBILE PHONES. They can be purchased with cash by customers who do not wish to give their names, addresses or credit card details. The pay-as-you-go phones are popular with criminals and terrorists because their anonymity shields their activities from the authorities. But they are also used by thousands of law-abiding citizens who wish to communicate in private.

The move aims to close a loophole in plans being drawn up by GCHQ, the government's eavesdropping centre in Cheltenham, to create a huge database to monitor and store the internet browsing habits, e-mail and telephone records of everyone in Britain. The "Big Brother" database would have limited value to police and MI5 if it did not store details of the ownership of more than half the mobile phones in the country.

The proposals have sparked a fierce backlash inside Whitehall. Senior officials in the HOME OFFICE HAVE PRIVATELY WARNED THAT THE DATABASE SCHEME IS IMPRACTICAL, DISPROPORTIONATE AND POTENTIALLY UNLAWFUL. The revolt last week forced Jacqui Smith, the home secretary, to delay announcing plans for the database until next year.

Pioneer hedge fund manager Michael Steinhardt is angry that the bailout of America is eroding the nation's capitalist ethos while those whose deeds crippled the U.S. economy suffer scant opprobrium, their names still untarnished. "Something really went wrong here. WE'RE ABOUT TO ENTER A PERIOD WHERE OUR BUDGET DEFICIT WILL DWARF ANYTHING WE'VE SEEN BEFORE," Steinhardt told the Reuters Investment Outlook Summit in New York.

"What we really needed a long time ago was a recognition that there were villains apace. THE EVILS OF THE FINANCIAL SYSTEM SHOULD HAVE BEEN RECOGNIZED LONG BEFORE THIS," said Steinhardt. While scornful of the financial executives who should have known better, he also belittled Washington for its lack of leadership and for not spelling out what the future beholds.

Steinhardt, however, said Americans themselves must share the blame for running away from the debacle and for not questioning the enormous public debt the U.S. government is about to assume. "If you cannot accept short-term pain, then YOU DO ALL SORTS OF THINGS TO COAT REALITY, TO PRETEND, TO FABRICATE, TO LIE. That is what has happened in American business in the last 10 years," he said.

There is obviously a problem for countries like Greece that were let into EMU for political reasons before their economies had been reformed enough to cope with the rigours of euro life - over the long run. Year after year of high inflation has eroded the competitive base of the economy. This is an insidious and slow effect, and very hard to reverse. Tourists are slipping away to Turkey, or Croatia. It will take a long time to lure them back. The underlying rot was disguised by the global credit bubble, and by the Greek property boom. It is now being laid bare. GREECE HAS A PUBLIC DEBT OF 93 PER CENT OF GDP, WELL ABOVE THE MAASTRICHT LIMIT.

I am a little surprised that the riot phase of this long politico-economic drama known as EMU has kicked off so soon, and that it has done so first in Greece, where the post-bubble hangover has barely begun. THE CRISIS IS MUCH FURTHER ADVANCED IN SPAIN, which is a year or two ahead of Greece in the crisis cycle. The picture is going to get very ugly as Europe slides deeper into recession next year. The IMF expects Spain's unemployment to reach 15pc. Immigrants are already being paid to leave the country. THERE WILL BE RIOTS IN SPAIN TOO.

I am certain that the British people still feel that the authorities who set economic policy are ultimately answerable to Parliament and to the democratic system. WILL THE GREEKS, THE SPANISH, THE FRENCH FEEL THAT WAY ABOUT THE EUROPEAN CENTRAL BANK AND THE STABILITY PACT WHEN THE CHIPS ARE REALLY DOWN?

The UN global warming conference currently underway in Poland is about to face a serious challenge from over 650 dissenting scientists from around the globe who are criticizing the climate claims made by the UN IPCC and former Vice President Al Gore.

Set for release this week, a newly updated U.S. Senate Minority Report features the dissenting voices of over 650 international scientists, many current and former UN IPCC scientists, who have now turned against the UN. The report has added about 250 scientists (and growing) in 2008 to the over 400 scientists who spoke out in 2007. THE OVER 650 DISSENTING SCIENTISTS ARE MORE THAN 12 TIMES THE NUMBER OF UN SCIENTISTS (52) WHO AUTHORED THE MEDIA HYPED IPCC 2007 SUMMARY FOR POLICYMAKERS.

The U.S. Senate report is the latest evidence of the growing groundswell of scientific opposition rising to challenge the UN and Gore. Scientific meetings are now being dominated by a growing number of skeptical scientists. The prestigious International Geological Congress, dubbed the geologists' equivalent of the Olympic Games, was held in Norway in August 2008 and prominently featured the voices and views of scientists skeptical of man-made global warming fears.

"It is critical for us to get a much better understanding of the impact of climate change in some parts of the world," Rajendra Pachauri, chairman of the U.N.'s Intergovernmental Panel on Climate Change, told The Associated Press in an interview Tuesday.

Scientific warnings of potential catastrophe have been the backdrop for talks among more than 10,000 delegates and environmentalists negotiating a treaty to control the emission of greenhouse gases, which have grown by 70 percent since 1970. The treaty, due to be completed in one year, would replace the Kyoto Protocol, which expires in 2012. Last year, Pachauri's IPCC, which collected the work of more than 2,000 scientists, said CLIMATE CHANGE IS "UNEQUIVOCAL, IS ALREADY HAPPENING, AND IS CAUSED BY HUMAN ACTIVITY."

Mr Steinbruck said the UK's switch from financial prudence to heavy borrowing was both "crass" and "breathtaking". Criticising the UK government's decision to cut VAT from 17.5% to 15%, Mr Steinbruck questioned how effective this will be. "Are you really going to buy a DVD player because it now costs £39.10 instead of £39.90?" he said. "ALL THIS WILL DO IS RAISE BRITAIN'S DEBT TO A LEVEL THAT WILL TAKE A WHOLE GENERATION TO WORK OFF."

Saying the UK government was now "tossing around billions", Mr Steinbruck questioned why Britain was now closely following the high public spending model put forward by 20th Century economist John Maynard Keynes. "The switch from decades of supply-side politics all the way to a crass Keynesianism is breathtaking," he said. "When I ask about the origins of the [financial] crisis, economists I respect tell me it is the credit-financed growth of recent years and decades. Isn't this the same mistake everyone is suddenly making again, under all the public pressure?"

While Mr Steinbruck has accused the UK of over-spending on the economic recovery, the German government has put 480bn euros (£370.4bn; $645bn) into a rescue package for its banks.

UPDATE:- Downing Street has hit back at an outspoken attack by Germany's finance minister on the government's plans to combat the economic downturn. Sources close to the government said Berlin was "out of step" with most nations on how to handle the crisis.

Interest rates have been cut both in the UK and in the eurozone, but they remain higher in the 15-member euro currency area. The pound was also hit by new data suggesting the UK economy had shrunk by 1% in the three months to November.

The pound stood at $1.4827 and at 1.1363 euros by later afternoon in London. The National Institute of Economic and Social Research indicated that the rate of output decline was "accelerating", and the institute now expects a fall of more than 1% in the last three months of the year.

"THE ONGOING FINANCIAL AND ECONOMIC CRISIS COULD TIP EVEN MORE PEOPLE INTO HUNGER AND POVERTY," the FAO added. The Rome-based organisation said that a preliminary estimate showed the number of undernourished people rose this year by 40m to about 963m people, after rising 75m in 2007. Before the food crisis, there were about 848m chronically hungry people in 2003-05.

"HIGH FOOD PRICES ARE DRIVING MILLIONS OF PEOPLE INTO FOOD INSECURITY, worsening conditions for many who were already food-insecure, and threatening long-term global food security," the FAO said in its report The State of Food Insecurity in the World 2008. Prices of agricultural commodities such as wheat, corn and rice jumped to record levels earlier this year, TRIGGERING FOOD RIOTS in countries ranging from Haiti to Egypt to Bangladesh and prompting appeals for food aid for more than 30 countries in sub-Saharan Africa.

Although food commodity prices have fallen about 50 per cent from this summer's all-time highs, they remain well above pre-crisis levels. The cost of rice, for example, has halved since July, but it still trades at prices that are 95 per cent above 2005 levels. In addition, the weakening of some emerging countries' currencies against the US dollar has partially erased gains from the drop in commodity prices.

However, with leaders' attention firmly focused on the global financial crisis and its economic ramifications, MANY OBSERVERS NOW BELIEVE THAT THE HUNGER AND POVERTY REDUCTION TARGETS ARE NO LONGER ACHIEVABLE BY 2015. The vast majority of the world's undernourished people – more than 90m – live in developing countries, according to FAO estimates. Of these, 65 per cent live in only seven countries: India, China, the Democratic Republic of Congo, Bangladesh, Indonesia, Pakistan and Ethiopia. In sub-Saharan Africa, one in three people – or almost 240m – are chronically hungry, the highest proportion of undernourished people in the total population.

STEINBRÜCK AND CHANCELLOR ANGELA MERKEL HAVE TAKEN IT UPON THEMSELVES TO SHOW THE WORLD HOW TO SOLVE AN ECONOMIC CRISIS WITHOUT SIGNIFICANT SPENDING PROGRAMS - and by ignoring the experts' advice and going it alone. It is a bold experiment, and being given such an award was encouraging, even a partial victory.

Measures taken merely to do something, as seen in a number of EU member states, Steinbrück said, were "UNHELPFUL." The programs being established or requested everywhere are a "HUGE WASTE OF MONEY," the German finance minister railed, adding that he doesn't believe in programs aimed at boosting demand. Steinbrück and the rest of the GERMAN GOVERNMENT WILL TAKE A CLOSER LOOK IN THE FIRST QUARTER OF NEXT YEAR. Should it then become necessary, Steinbrück said in his speech last week, further action will then be taken. NOT BEFORE.

"We don't want government to run companies," Obama told Tom Brokaw on 'Meet the Press'. "Generally, government historically hasn't done that very well." But what Obama went on to describe was a long-term government bailout that would be conditioned on government oversight. IT COULD MEAN THAT THE GOVERNMENT WOULD MANDATE, OR AT LEAST HEAVILY INFLUENCE, WHAT KIND OF CARS COMPANIES MAKE, what mileage and environmental standards they must meet and what large investments they are permitted to make — to recreate an industry that Obama said "actually works, that actually functions."

It all sounds perilously close to a word that no one in Obama's camp wants to be caught uttering:- NATIONALIZATION. Yet so far, there is no talk of offering aid to Toyota, Honda, BMW or the other foreign automakers that have built factories on American soil, employed American workers and managed to make a profit doing so.

"IF JAPAN WAS DOING THIS, WE'D BE THREATENING BILLIONS OF DOLLARS IN RETALIATION," said Jeffrey Garten, a professor at the Yale School of Management, who as under secretary of commerce in the 1990s was one of many government officials who tried in vain to get Detroit prepared for a world of international competition. "IN FACT, WHEN THEY DID SOMETHING A LOT MORE SUBTLE, WE THREATENED EXACTLY THAT," referring to calls for import restrictions.

India has said it is keeping all options open following last month's carnage by the Mumbai terrorists, who killed more than 170 people. "We do not want to impose war, but we are fully prepared in case war is imposed on us," said Mr Qureshi. "We are not oblivious to our responsibilities to defend our homeland. But it is our desire that there should be no war."

Indian officials say the hardline Lashkar-e-Taiba (LeT) group, which is based in Pakistan despite being banned by the government, is behind the bloodshed, and Indian media have suggested there could be Indian strikes on militant camps. Mr Qureshi said he was sending "a very clear message" that his country did not want conflict with India. "We want friendship, we want peace and we want stability - but our desire for peace should not be considered Pakistan's weakness."

The minister also said that India's demands for the extradition of suspects in the Mumbai attacks were out of the question and that Pakistan, which has arrested 16 people since Saturday, would keep them on home soil. "The arrests are being made for our own investigations. Even if allegations are proved against any suspect, he will not be handed over to India," Qureshi said. "We will proceed against those arrested under Pakistani laws."

Earlier, the Food Standards Agency said the NI pork industry could resume operations after investigations into whether dioxins were present in meat. The agency said it was confident no pigs had been fed contaminated feed. "We are quite happy that Northern Ireland pigs are free from the contamination," said Maria Jennings of the Northern Ireland FSA.

Earlier, it emerged that 11 NI premises processed pork from the Republic and the meat was put on sale in Northern Ireland. Pork products from the Republic were recalled over fears that pig feed at an animal meal plant was tainted with oil containing potentially harmful dioxins. In the Republic, almost 1,400 pork processing workers have been laid off following the contamination scare.

However, Ms Jennings said: "We are absolutely certain at this point in time that Northern Ireland pork is safe to eat. We're quite happy for processors to start processing and filling our shelves with Northern Ireland pork and pork products." Meanwhile, all 36 Tesco stores are re-stocking their shelves with pork products, sourced from Northern Ireland.

The Republic Windows and Doors factory closed abruptly last week after Bank of America canceled the company's financing. Since then, about 200 of the 240 laid-off workers have taken turns occupying the factory, declaring that they will not leave until getting assurances they will receive severance and accrued vacation pay.

But the standoff has also come to embody MOUNTING ANGER OVER THE GOVERNMENT'S WILLINGNESS TO BAIL OUT DEEP-POCKETED CORPORATIONS BUT NOT AVERAGE PEOPLE.

"There's a simplicity and straightforwardness to this particular case that anybody can wrap their head around," said James Thindwa, executive director for the Chicago office of Jobs With Justice, a national coalition of unions, community groups and other organizations.

According to an investigative report published Monday by a state-owned newspaper, public security officials in Xintai city have been INSTITUTIONALIZING RESIDENTS WHO PERSIST IN THEIR PERSONAL CAMPAIGNS TO EXPOSE CORRUPTION OR TO PROTEST THE UNFAIR SEIZURE OF THEIR PROPERTY. Some people said they were committed up to two years, and several of those interviewed said they had been forced to consume psychiatric medication. The article, in The Beijing News, said MOST INMATES HAD BEEN RELEASED AFTER THEY AGREED TO GIVE UP THEIR CAUSES.

Sun Fawu, 57, a farmer seeking compensation for land spoiled by a coal mining operation, said he was seized by the local authorities on his way to petition the central government in Beijing and brought to the Xintai Mental Health Center in October. During a 20-day stay, he said he was tied to a bed, forced to take pills and given injections that made him numb and woozy. When he told the doctor he was a petitioner, not mentally ill, the doctor reportedly said, "I don't care if you're sick or not. As long as you are sent by the township government, I'll treat you as a mental patient."

In an interview with the paper, the hospital's director, Wu Yuzhu, acknowledged that some of the 18 patients brought there by the police in recent years were not deranged, but he had no choice but to take them in. "THE HOSPITAL ALSO HAD ITS MISGIVINGS," he said. Reached by phone on Monday, a hospital employee said Wu, THE HOSPITAL DIRECTOR WHO VOICED HIS MISGIVINGS TO THE BEIJING NEWS, WAS UNAVAILABLE. The employee, Hu Peng, said local government officials had taken him away FOR "A MEETING" earlier in the day and had also looked through patient records.