http://www.washingtonpost.com/…

Citigroup has agreed to buy Wachovia bank in a deal brokered by the Federal Deposit Insurance Corporation to avoid another major corporate failure in the midst of the ongoing financial crisis.

The FDIC announced the deal on its Web site this morning. No price for the transaction was included in the announcement. But the FDIC said that the deal hinged on a loss sharing arrangement between Citigroup and the FDIC, the agency responsible for insuring bank deposits.

Wachovia has been saddled by mortgage-related losses. Under the terms of the deal, Citigroup will absorb up to $42 billion of losses on a $312 billion pool of loans. The FDIC will be responsible for any losses beyond that, but was given $12 billion in Citigroup preferred stock and warrants in return for that guaranty.

The FDIC statement emphasized that Wachovia “did not fail,” and that its branches and other offices will be open as usual.

http://www.bloomberg.com/…

European governments stepped in to rescue Fortis, Bradford & Bingley Plc, and Hypo Real Estate Holding AG as tremors from the U.S. credit crisis reverberated around the world.

The U.K. Treasury seized Bradford & Bingley, Britain’s biggest lender to landlords, while governments in Belgium, the Netherlands and Luxembourg threw an 11.2 billion-euro ($16.3 billion) lifeline to Fortis. Germany guaranteed a loan to Hypo.

The interventions exposed how fallout from the crisis that drove Lehman Brothers Holdings Inc. into bankruptcy and prompted a $700 billion U.S. bank-rescue package has gone global. It also added urgency to negotiations among European policy makers as to how they deal with banking collapses.

“The precarious global environment means the weakest links in Europe are now falling,” said Mamoun Tazi, an analyst at MF Global Securities Ltd. in London. “If banks continue not to lend to each other we’ll see more failures.”

More insider deals, more centralization, more government interference and control.

This is what happens when you have a system based on debt on a large scale. It’s inherently insolvent.

Update:

This is cute…

Federal Reserve Chairman Ben Bernanke said in a statement the FDIC action “demonstrates our government’s unwavering commitment to financial and economic stability.”

http://www.breitbart.com/…

Americans are the world’s top consumers of cannabis and cocaine despite punitive US drug laws, according to an international study published in the online scientific magazine PLoS Medicine.

The study, released Monday, revealed that 16.2 percent of Americans had tried cocaine at least once, and 42.4 percent had used marijuana.

In second-place New Zealand, just 4.3 percent of study participants had used cocaine, and 41.9 percent marijuana.

The research was conducted at the University of New South Wales in Sydney, based on World Health Organization data from 54,068 people in 17 countries.

Rates of participation differed from country to country, and researchers noted uncertainty over how honestly people report their own drug use.

“Nevertheless, the findings present comprehensive data on the patterns of drug use from national samples representing all regions of the world,” a PLoS statement said.

A vast majority of survey participants from the United States, Europe, Japan and New Zealand had consumed alcohol, compared to smaller percentages from the Middle East, Africa and China.

The data also revealed socioeconomic patterns in drug use. Single young adult men with high income had the greatest tendency to regularly use drugs.

Drug use “does not appear to be simply related to drug policy,” the researchers wrote, “since countries with more stringent policies toward illegal drug use did not have lower levels of such drug use than countries with more liberal policies.”

In the Netherlands, where drug policy is more liberal than the United States, 1.9 percent of survey participants said they had used cocaine and 19.8 percent marijuana.

Twelve US 12 states including California permit medical use of marijuana, but possession and use remains prohibited under federal law.

And despite the US government’s massive anti-drug efforts, the United States remains the world’s top drug market, one amply supplied by South American cartels.

The US Drug Enforcement Agency has observed ever larger quantities of illegal drugs pouring into the country.

“We are seizing greater quantities of illegal drugs than ever before,” said a DEA statement last week.

In 2007, agents seized 41 metric tons of cocaine in just two raids, and denied drug traffickers record-breaking revenue of 3.5 billion dollars for the year, it said.

That war on drugs is working real well, huh?

From the NYTimes:

In a significant setback for efforts to reform Europe’s unwieldy institutions, a senior Irish official said Friday that voters had rejected a revised European Union treaty designed to change the way the bloc governs itself and presents itself to the world.

The BBC reports that “Voters in Ireland have rejected the European Union’s Lisbon reform treaty in a referendum by 53.4% to 46.6%.” The Beeb also has a Q&A on the referendum at their site. The most interesting question:

Why is Ireland the only EU member to be holding a referendum?

Under Irish law, any amendment to EU treaties requires an amendment to the Irish constitution - and all constitutional amendments require approval by referendum. That has been the case since a Supreme Court ruling in 1987.

Governments in other EU member states have argued that the Lisbon Treaty is an amending treaty which, like other EU amending treaties, only requires parliamentary approval. So they are all going down the parliamentary ratification route.

Yet there are calls in several member states for referendums. In the UK, the opposition Conservatives and some Labour MPs have demanded a referendum. They say the Lisbon Treaty is very much like the EU constitution - and that the Labour Party promised to hold a referendum on the constitution.

Funny that they mention the EU constitution. Since that effort failed to make it past the vote of the people (see France and the Netherlands), it’s reworded as a treaty and adopted by parliamentary approval in most European states. If I were Irish, I’d probably vote NO on those grounds alone.