Wall Street Week Ahead: A lump of coal for 'Fiscal Cliff-mas'

By Rodrigo Campos

NEW YORK (Reuters) - Wall Street traders are going to have to pack their tablets and work computers in their holiday luggage after all.

A traditionally quiet week could become hellish for traders as politicians in Washington are likely to fall short of an agreement to deal with $600 billion in tax hikes and spending cuts due to kick in early next year. Many economists forecast that this "fiscal cliff" will push the economy into recession.

Thursday's debacle in the U.S. House of Representatives, where Speaker John Boehner failed to secure passage of his own bill that was meant to pressure President Obama and Senate Democrats. This only added to worry that the protracted budget talks will stretch into 2013.

Still, the market remains resilient. Friday's decline on Wall Street, triggered by Boehner's fiasco, was not enough to prevent the S&P 500 from posting its best week in four.

"The markets have been sort of taking this in stride," said Sandy Lincoln, chief market strategist at BMO Asset Management U.S. in Chicago, which has about $38 billion in assets under management.

"The markets still basically believe that something will be done," he said.

If something happens next week, it will come in a short time frame. Markets will be open for a half-day on Christmas Eve, when Congress will not be in session, and will close on Tuesday for Christmas. Wall Street will resume regular stock trading on Wednesday, but volume is expected to be light throughout the rest of the week with scores of market participants away on a holiday break.

For the week, the three major U.S. stock indexes posted gains, with the Dow Jones industrial average <.DJI> up 0.4 percent, the S&P 500 <.SPX> up 1.2 percent and the Nasdaq Composite Index <.IXIC> up 1.7 percent.

IT COULD GET A LITTLE CRAZY

Equity volumes are expected to fall sharply next week. Last year, daily volume on each of the last five trading days dropped on average by about 49 percent, compared with the rest of 2011 - to just over 4 billion shares a day exchanging hands on the New York Stock Exchange, the Nasdaq and NYSE MKT in the final five sessions of the year from a 2011 daily average of 7.9 billion.

If the trend repeats, low volumes could generate a spike in volatility as traders keep track of any advance in the cliff talks in Washington.

"I'm guessing it's going to be a low volume week. There's not a whole lot other than the fiscal cliff that is going to continue to take the headlines," said Joe Bell, senior equity analyst at Schaeffer's Investment Research, in Cincinnati.

"A lot of people already have a foot out the door, and with the possibility of some market-moving news, you get the possibility of increased volatility."

Economic data would have to be way off the mark to move markets next week. But if the recent trend of better-than-expected economic data holds, stocks will have strong fundamental support that could prevent selling from getting overextended even as the fiscal cliff negotiations grind along.

Small and mid-cap stocks have outperformed their larger peers in the last couple of months, indicating a shift in investor sentiment toward the U.S. economy. The S&P MidCap 400 Index <.MID> overcame a technical level by confirming its close above 1,000 for a second week.

"We view the outperformance of the mid-caps and the break of that level as a strong sign for the overall market," Schaeffer's Bell said.

"Whenever you have flight to risk, it shows investors are beginning to have more of a risk appetite."

Evidence of that shift could be a spike in shares in the defense sector, expected to take a hit as defense spending is a key component of the budget talks.

The PHLX defense sector index <.DFX> hit a historic high on Thursday, and far outperformed the market on Friday with a dip of just 0.26 percent, while the three major U.S. stock indexes finished the day down about 1 percent.

Following a half-day on Wall Street on Monday ahead of the Christmas holiday, Wednesday will bring the S&P/Case-Shiller Home Price Index. It is expected to show a ninth-straight month of gains.

U.S. jobless claims on Thursday are seen roughly in line with the previous week's level, with the forecast at 360,000 new filings for unemployment insurance, compared with the previous week's 361,000.

(Wall St Week Ahead runs every Friday. Questions or comments on this column can be emailed to: rodrigo.campos(at)thomsonreuters.com)

(Reporting by Rodrigo Campos; Additional reporting by Chuck Mikolajczak; Editing by Jan Paschal)

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Sexual assault reports jump 23 percent at US military academies

By David Alexander

WASHINGTON (Reuters) - Sexual assaults reported by students at the three U.S. military academies jumped 23 percent in 2012, underscoring what Defense Secretary Leon Panetta said was a "persistent" problem that required a "strong and immediate response" from the services.

Eighty cases of sexual assault were reported by cadets and midshipmen during the 2011-2012 academic year, compared to 65 the previous year, the Pentagon said on Friday in its annual report on sexual harassment and violence at the academies. The victims were primarily women, although four were men.

It was the third straight year of increases, from a low of 25 in 2009. Prior to that, reported sexual assault cases had fallen regularly from 42 in 2006, when the Pentagon first began tracking the issue at the direction of Congress, the report said.

"Despite our considerable and ongoing efforts, this year's annual report ... demonstrates that we have a persistent problem," Panetta said in a memorandum to the secretaries of the Navy, Army and Air Force.

He said the lack of progress at the Naval Academy in Annapolis, Maryland, the Air Force Academy in Colorado Springs, Colorado, and the United States Military Academy at West Point, New York, merited "a strong and immediate response."

Panetta and he asked the services to identify "new ways to advance a climate of dignity and respect" at the academies and report back to him by the end of March.

The findings drew expressions of concern from lawmakers and special interest groups that track the issue. Representative Niki Tsongas said that while the rise could partly be attributed to improved conditions that encourage people to report assaults, they also showed the issue remains a problem.

"Sexual assault remains a persistent and untenable crime throughout the armed forces," she said in a statement. "These numbers are an affront to the educational institutions that are developing our military's future leaders."

Nancy Parrish, president of Protect Our Defenders, said the report "shines a light on the severity and scope of the crisis" of sexual assault in the military.

"There is a culture of high tolerance for rape and sexual predators in the ranks that pervades the military," she said. "Clearly all the reforms that have been announced over many years aren't making a difference."

The academies are implementing programs to try to reduce sexual assaults. At the same time, they are attempting to create an environment that encourages reporting, whether on a confidential basis that enables victims to get care and counseling or an unrestricted basis that also permits full criminal investigation.

Of the 80 cases reported in 2012, 42 were unrestricted, allowing authorities to pursue a criminal investigation with the assistance of the victim. Thirty-eight cases remained confidential and were not investigated, officials said.

The academies investigated 40 sexual assault cases in 2012, 23 from 2012 and 17 from the previous year. Of that number, 11 were prosecuted and punished, including eight suspects who were court martialed. The others were not prosecuted, either because the military lacked jurisdiction or evidence, officials said.

The Pentagon surveys students every two years to assess gender relations at the schools and to get a better idea about the number of sexual assaults that go unreported.

The survey conducted as part of this year's report found that 12.4 percent of women and 2 percent of men had reported unwanted sexual contact during the previous 12 months - statistically unchanged from the prior survey.

Fifty-one percent of women reported experiencing sexual harassment during the previous year, down from 56 percent in the 2010 survey. Ten percent of men reported experiencing sexual harassment, statistically unchanged from the earlier survey.

Unwanted sexual contact ranged from rape or sexual assault, to attempted attacks, forcible sodomy and other types of sexual contact, officials said. Major General Gary Patton, director of the Sexual Assault Prevention and Response Office, said there was an important correlation between sexual assault and sexual harassment.

"Eliminating sexual harassment is critical to preventing sexual assault," he said, adding that those who experience sexual assault in the past year had also been sexually harassed.

"The solution to this problem is ... creating a nonpermissive environment where sexual harassment, sexist behavior, stalking and these types of behaviors are not condoned," Patton said. (Reporting By David Alexander; Editing by Will Dunham and Sandra Maler)

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Hundreds pay tribute to legendary sitarist Ravi Shankar

By Roselle Chen

ENCINITAS, California (Reuters) - Ravi Shankar's daughters, Norah Jones and Anoushka Shankar, along with the wife of late Beatle George Harrison said their final goodbyes to the sitar virtuoso on Thursday at a public memorial service in Encinitas, California.

The legendary musician and composer, who helped introduce the sitar to the Western world through his collaboration with The Beatles, died on December 11 in Southern California. He was 92.

About 700 people joined Shankar's wife, Sukanya, and family at the service held at a spiritual center in the coastal town about 25 miles (40 km) north of San Diego.

Olivia Harrison, the widow of Beatles guitarist George Harrison, told Reuters the three-time Grammy winner who formed a musical and spiritual bond with The Beatle "expressed music at its deepest level."

"As a person he was just sweet and seemed to know everything," she added. "He was a true citizen of the world."

Shankar is credited with popularizing Indian music through his work with violinist Yehudi Menuhin and The Beatles beginning in the mid-1960s, inspiring George Harrison to learn the sitar and the British band to record songs like "Norwegian Wood" (1965) and "Within You, Without You" (1967).

"He completely transformed (George's) musical sensibilities," a tearful Harrison told the crowd. "They exchanged ideas and melodies until their hearts and minds were intertwined like a double helix."

'LITTLE CRUMB'

His friendship with Harrison led him to appearances at the Monterey and Woodstock pop festivals in the late 1960s and the 1972 Concert for Bangladesh. He became one of the first Indian musicians to become a household name in the West.

His influence in classical music, including on composer Philip Glass, was just as large. His work with Menuhin on their "West Meets East" albums in the 1960s and 1970s earned them a Grammy, and he wrote concertos for sitar and orchestra for both the London Symphony Orchestra and the New York Philharmonic.

"I always felt like a little crumb in his presence," Zubin Mehta, a former music director of the New York Philharmonic and collaborator with Shankar, said at the service.

Jazz pianist Herbie Hancock also attended the service along with "Anna Karenina" director Joe Wright, the husband of Shankar's daughter Anoushka.

Shankar, who had lived in Encinitas for the past 20 years, had suffered from upper respiratory and heart issues over the past year and underwent heart-valve replacement surgery last week at a hospital in San Diego.

The surgery was successful but he was unable to recover.

Shankar's final concert was on November 4 in Long Beach, California, with his Grammy-winning sitarist daughter Anoushka, who spoke giving thanks to those who came. Jones, the third Grammy-winner in the family, did not speak at the service. (Writing by Eric Kelsey; editing by Philip Barbara)

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Thailand now aiming for F1 race in 2015

REUTERS - Thailand expects to host a floodlit Formula One Grand Prix in Bangkok in 2015 after plans were pushed back a year, the governor of the national sports authority said on Friday.

"An F1 race is likely to take place here in early 2015 instead of in 2014 in our initial plan," Kanokphand Chulakasem told the Bangkok Post newspaper.

The 2014 season is due to see two new races, at Sochi in Russia and at a New Jersey street circuit, on a calendar which already has a record 20 rounds, but Thailand would be a novelty for the year after.

Bangkok's Rajamangala stadium recently hosted the annual Race of Champions event with Red Bull's triple world champion Sebastian Vettel teaming up with Michael Schumacher to win the team title for Germany.

The paper's website quoted Red Bull's Michael de Santiesteban, representative of the energy drink's Thai co-owner Chalerm Yoovidhya, as saying talks with Formula One supremo Bernie Ecclestone were going well.

"It is likely to be held in Bangkok. With Thailand on the calendar, a current race is likely to be removed," he said.

Chulakasem met Ecclestone at this year's Singapore Grand Prix in September and said then that there was an agreement in principle for a race in 2014.

Tourism and sports minister Chumpol Silpa-archa said at the same time that the government would bear 60 percent of the total cost and the rest would come from private companies.

Red Bull's British-based Formula One team have won both championships for the past three years and are expected to back the Thai race.

Southeast Asia already has two races, in Malaysia and the night-time Singapore Grand Prix. (Reporting by Alan Baldwin in London, editing by Peter Rutherford)

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Loved and loathed, Park takes South Korea's presidency

By Jack Kim and David Chance

SEOUL (Reuters) - South Korea's first woman president, Park Geun-hye, will have her job cut out when she takes office in February with the economy slowing, her father's autocratic rule still an issue for many and North Korea as unpredictable as ever.

Park, 60, won Wednesday's hotly contested election comfortably. She replaces fellow conservative Lee Myung-bak after his mandatory single, five-year term ended.

The slightly built and elegant Park grew up in Seoul's presidential palace during the 18-year rule of her father, Park Chung-hee, who took power in a military coup in 1961.

Park is likely to face protests by South Korea's vocal left, angry over the rise to power of the daughter of a man they believe was a repressive "dictator".

"This will be a tremendous burden on her ability to govern," said political commentator Yu Chang-seon of Park's heritage.

"It effectively means that she could be in direct conflict with half of society ... The first six months will be key."

On the economy, which dominated the election campaign, Park has promised more social welfare but given few specifics.

Korea has achieved astonishing success in rising from the ashes of the 1950-53 Korean War to become the world's 14th largest economy, but rewards have been thinly spread.

Economic growth was 5.5 percent for decades, driven by some of the world's biggest companies, such as Samsung Electronics Co Ltd <005930.KS> and Hyundai Motor Co <005380.KS>. That pace has slowed and this year the economy will expand by about 2 percent.

The hundreds of thousands of graduates that South Korean universities churn out each year complain they have trouble finding decent jobs and income differentials have widened sharply. Park's party says it will not spend more money to boost the economy.

LEGACY

Park has at times invoked her father's legacy of rapid growth that propelled South Korea into the league of industrialised nations.

At other times, she has apologised for his suppression of protests and the execution of people suspected of sympathising with the North, which is still technically at war with the South after an armistice ended the Korean War.

Families of those who were executed under her father's rule believe Park has not apologised enough and that she has sought to sweep her past under the carpet. Park was her father's "First Lady" following the assassination in 1974 of her mother up until the former ruler's own shooting in 1979.

The most notorious executions under Park's rule were of eight men aged 30 to 52 who were dubbed the "People's Revolutionary Party". They were hanged 24 hours after being sentenced for treason, leaving scant time for review.

The eight represented a broad section of South Korean society, comprising a bee keeper, a brewery owner, an acupuncurist and teachers. They were exonerated posthumously by the Supreme Court in 2007.

"What she needs to be doing is to reach out to everyone, to those who oppose her, to show her interest and offer her sympathy and to say that she feels sorry for what happened," said Reverend Park Jung-il, who was the chief army chaplain in April 1975 and witnessed the dawn executions of the eight men.

As well as confronting a domestic legacy that is still painful for many South Koreans, Park will have to deal with Kim Jong-un, the 29-year-old ruler of North Korea whose grandfather ordered several assassination attempts on her father.

SEEKING A THAW

In 2002, during a thaw in relations, Park met Kim Jong-il, the father of the latest Kim to rule the isolated state that in 2010 sank a South Korean naval vessel and shelled a South Korean island.

When she met him, Park declared the man who later propelled North Korea to become what it calls a "nuclear weapons power" to be someone "who would keep his word".

Park has said she will seek to improve ties with Pyongyang.

Incumbent conservative President Lee infuriated the North by cutting off aid to a country where a third of the population is said by the United Nations to be malnourished.

At the same time, Park has declared she will not tolerate the North's nuclear weapons programme.

On the face of it, North Korea is in no mood for compromise. It has declared it will not ditch its nuclear weapons capacity, which it recently termed "treasured".

It pushed ahead with a rocket launch that is banned under U.N. resolutions imposed in the wake of its 2006 and 2009 nuclear tests as the South got ready to vote.

Park herself has become a target for Pyongyang's propaganda machine which has denounced Lee's five year rule as bringing "nightmare, despair, (and )catastrophe". (Editing by Dean Yates)

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Asian shares pause as U.S. budget talks stall

By Chikako Mogi

TOKYO (Reuters) - Asian shares paused on Thursday after rallying to their highest in nearly 17 months the day before, as talks to avert a U.S. fiscal crisis stalled - prompting worries of the world's largest economy sliding back into recession.

The yen remained under pressured as the Bank of Japan concludes its two-day policy meeting later in the session, with market participants expecting further easing steps to help support the fragile economy.

MSCI's broadest index of Asia-Pacific shares outside Japan was little changed, with Australian shares easing 0.1 percent, off a 17-month high hit on Wednesday. Seoul shares opened 0.5 percent higher, after Wednesday's presidential election, with many traders expecting talk of fresh stimulus measures from the government.

World stocks trimmed gains on Wednesday after reaching a 17-month high as talks to avert the U.S. "fiscal cliff" of tax hikes and spending cuts set to begin early next year appeared to stall.

President Barack Obama accused Republicans of digging in their heels due to a personal grudge against him, while a top Republican called the president "irrational."

"If this discussion continues to go as it has gone today (Wednesday), watch for more selling off as hopelessness begins to take hold for many investors across all asset classes," said Neal Gilbert, market strategist at GFT Forex, in a note to clients.

"Ironically, the USD may be one of the biggest beneficiaries of a failure. Rampant buying of US treasuries and selling of risk assets like the equities market could create a very significant move, particularly since the rallies seen earlier have been attributed to the optimism of a deal," Gilbert said.

The Nikkei stock average opened down 0.7 percent after closing Wednesday up 2.4 percent and above the key 10,000 level for the first time since April, as expectations for more easing weakened the yen, which improves earnings prospects for Japanese exporters.

The Bank of Japan is expected to deliver its third dose of monetary stimulus in four months on Thursday in a prelude to more aggressive action next year, as it faces intensifying pressure from the country's next leader for stronger efforts to beat deflation.

On Thursday, the BOJ will also announce details of a new loan programme unveiled in October to supply banks with cheap long-term funds without limiting the amount of cash made available.

With markets already very bearish on the yen, traders warned a lack of bold action could see short positions squeezed.

"We may see the yen regain its footing over the next 24-hours of trading should Governor Masaaki Shirakawa take a greater stand in preserving the central bank's independence," said David Song, currency analyst at DailyFX.

The dollar was down 0.2 percent against the yen at 84.20 but near Wednesday's 20-month high of 84.62. The euro fell 0.3 percent against the yen at 111.35 yen, retreating from a 16-month high of 112.59 yen reached on Wednesday.

The euro was down 0.1 percent to $1.3213, slipping from a 8-1/2-month high of $1.33085 hit on Wednesday after the Ifo survey showed German businesses sentiment rose in December as confidence in the outlook rose at its fastest rate in 2-1/2 years, boosting hopes Europe's largest economy will bounce back quickly after a weak end to 2012.

Reflecting nervousness caused by the uncertainty over the U.S. fiscal cliff, data from the Investment Company Institute, a U.S. mutual fund trade organisation, on Wednesday showed investors in U.S.-based mutual funds pulled $8.48 billion from equity funds for the week ended December 12.

U.S. crude fell 0.3 percent to $89.68 a barrel.

The lacklustre equities market also slowed trading in Asian credit markets, keeping the spreads on the iTraxx Asia ex-Japan investment-grade index barely moved from Wednesday.

(Additional reporting by Ian Chua in Sydney; Editing by Eric Meijer)

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Venezuela's Chavez stable after respiratory infection

CARACAS (Reuters) - Venezuela's President Hugo Chavez is in a "stable" condition in Cuba after being treated for a respiratory infection following his cancer surgery last week, the government said.

Chavez, 58, is battling to recover from his fourth operation since he was first diagnosed with cancer in mid-2011. (Reporting by Andrew Cawthorne; Editing by Eric Walsh)

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Gold bounces on U.S. dollar but near four-month low

SINGAPORE (Reuters) - Gold regained strength on Wednesday as the U.S. dollar weakened against the euro, but the metal was still within sight of its weakest in nearly four months after signs of progress in the U.S. fiscal talks dented its safe haven appeal.

FUNDAMENTALS

* Gold added $5.85 an ounce to $1,675.39 by 0032 GMT after falling to $1,661.01 on Tuesday, its lowest since August on technical selling and growing hopes U.S. legislators are closer to reaching a deal that would avert a fiscal crisis next month.

* U.S. gold futures for February rose $6.20 an ounce to $1,676.90.

* U.S. House of Representatives Majority Leader Eric Cantor said he expects a vote on a Republican offer to avert the "fiscal cliff" on Thursday, and he expects to have enough votes to pass the measure.

MARKET NEWS

* The euro hovered at multi-month highs against the dollar and yen on Wednesday, having extended recent gains as tentative signs of progress in the U.S. fiscal talks bolstered demand for riskier assets. A weaker dollar makes dollar-priced gold cheaper for holders of other currencies.

* Japan's Nikkei share average is set to test eight-month highs above 10,000 on Wednesday as investor appetite is boosted by signs of progress in the U.S. fiscal talks and expectations of aggressive monetary easing under the new Japanese government.

(Reporting by Lewa Pardomuan; Editing by Ed Davies)

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Afghans turn to AK-47, fearing Taliban return or civil war

By Martin Petty

KABUL (Reuters) - Afghan father-of-four Mohammad Nasir has a secret he's been keeping from his family.

The aid worker pulls a television bench out from the living-room wall of his Kabul home. Behind it is a carved out shelf, hiding what he hopes will keep loved ones safe when Western troops withdraw by the end of 2014 -- an AK-47 assault rifle.

Arms purchases are soaring in Afghanistan, along with the price of weapons, a sign that many Afghans fear a return of the Taliban, civil war or rising lawlessness.

An assault rifle cost $400 a year ago. Today, some arms dealers are selling them for triple the price.

And it's not just ordinary Afghans who are buying. Warlords who control militias, and former anti-Soviet mujahideen fighters are also boosting the trade.

"Whenever you turn on the TV or radio, the discussion is 2014. I'm not feeling safe now, it's become like doomsday for Afghans," said Nasir, 48, storing the polished second-hand rifle and slamming the TV unit back against the wall.

"People are saying security will collapse, or soldiers will join warlords or the Taliban, so we need something to protect our families when there's a crisis."

The brisk arms business is complicating the government's efforts to pacify a country where the Taliban can strike virtually anywhere, ethnic tensions can easily ignite violence, and warlords are constantly jockeying for influence.

Afghanistan wants to project an image of stability ahead of 2014, a critical year when presidential elections will be held and the 350,000 Afghan security force will take over security.

Any upheaval could also encourage regional powers like Iran and Pakistan to try and gain influence before the Afghan endgame, a widespread fear among officials and ordinary Afghans.

President Hamid Karzai calls the talk of chaos, Western media "propaganda", and says Afghan security forces have made great progress.

But for many Afghans, the threat of a descent into chaos is real so a growing number are investing in weapons, despite exorbitant costs. The average Afghan family earns only about $200 a month.

FEAR OF 2014 BATTLEFIELDS

Reuters spoke to buyers and sellers of illegal arms in five provinces and each cited the foreign troop withdrawal as the main driver of the underground trade.

"More people are buying weapons now, some to protect themselves from kidnappers and robbers and others in anticipation of things getting worse," said a Kabul resident in his fruit shop, where a verse from the Koran on the wall calls for God to guide Muslims on a straight path.

He bought a handgun illegally for $500, a model his dealer says now fetches $1,000.

"If the situation changes in 2014 this area will once again become a battlefield between former warlords who are still powerful," he said.

The government has highlighted 2014 as a year to invest in Afghanistan, which has relied on foreign aid for its economic lifeline, and take advantage of its cheap labour and land leases. Last month it held a televised conference promoting the country's natural resources and its industrial potential.

In the 10 years following 2014, the government hopes revenues from oil, natural gas, iron, copper and other mining ventures will generate $4 billion in annual revenue.

But in the north, which is home to untapped oil and gas resources, warlords and their supporters are now re-arming for fear militants may seize power again, say residents.

Afghanistan's largest foreign investment project, the Aynak copper deposit in Logar province, lies in one of the country's most dangerous regions just south of the capital, Kabul.

Rocket attacks this year saw its Chinese workers temporarily flee the project, which is run by China Metallurgical Group (MCC) and Jiangxi Copper <600362.SS>.

AK-47: A LEGACY OF WAR

Afghanistan has seen little peace in three decades. The American-backed mujahideen drove out the Russians in 1989 after 10 years of occupation, but American interest faded quickly.

Much of Kabul was later destroyed in a civil war and more than 50,000 civilians killed. The Taliban rose from the ashes of that conflict and imposed their austere brand of Islam.

Afghans fear they will be abandoned by the United States once again. Most don't want the Taliban to return, so they are determined to protect themselves.

And there are plenty of weapons; arms left over from the war against the Soviets, guns smuggled over the porous border with Pakistan and those sold by former mujahideen commanders.

Russian or Pakistani-made AK-47 assault rifles are the biggest sellers, followed by light machineguns. In some areas, the militias go for rocket-propelled grenades.

To avoid arrest, arms dealers and sellers operate by word of mouth, avoiding cellphones which may be tapped by authorities. Deals are sealed in restaurants, homes or busy street markets.

Afghan authorities say they've had success in seizures of illegal firearms but concede that in a country with a turbulent history, their efforts may have little impact.

The government was deeply embarrassed when Energy and Water Minister Ismail Khan, an influential former warlord, recently called on militias to rearm to protect Afghanistan after 2014.

General Mohammed Najib Aman, a deputy of the anti-terrorism department at the Interior Ministry, denies the illegal gun trade is flourishing.

"Buying and selling of weapon, without being authorized, is...illegal and they will be arrested," Aman told Reuters.

The government is encouraging people to seek licenses for weapons so the authorities can track guns. Aman estimates between 30,000 and 40,000 gun licenses have been issued.

But the positive message from the government and NATO-led force runs counter to the unease on the streets, where the Afghan security force has gained little public confidence.

"In my area there are lots of kidnappings, robbery and other criminal activities and also lots of fear of 2014," said Shir Ali, speaking in his pharmacy in northern Kunduz Province. "I bought this very expensive Kalashnikov to protest my family."

'GUN CULTURE' ENTRENCHED

At least 57 foreign troops have been killed by rogue Afghan security personnel this year. That figure represents about 13 percent of ISAF deaths in Afghanistan in 2012.

Lieutenant General James Terry, deputy commander of U.S. forces in Afghanistan, said the country's "gun culture" was partly to blame.

"This is a society that's really been traumatized by 30-plus years of war," Terry said. "We also understand that a lot of grievances and dispute resolutions are done, frankly, at the barrel of a gun."

Former mujahideen commanders in particular are cashing-in on the insecurity, using their wartime connections to acquire handguns and rifles and sell at inflated prices.

Islamuddin laid down his weapons after the Taliban was ousted in 2001, and became a used car salesman. These days that's a front for his real money-making business.

He now sells light machine guns for 150,000 Afghanis, double the value a year ago, and AK-47s for 60,000 Afghanis, triple that of last year.

"People are worried, so they're buying guns now because they might not be able to buy one when they most need it," he said sitting in a hotel restaurant.

Militias also look to be heeding Ismail Khan's call to arms.

"The number of sales and the price of guns has gone up and former mujahideen commanders who served warlords are buying more and more from us every day," said one seller. "They're anticipating civil war once the foreign troops leave."

Not all Afghans expect a war. Waheed Mujhda, a politics expert at the Afghan Analytical and Advisory Centre, said even warlords realised renewed civil conflict would not help anyone.

"Having so many people owning guns is a big problem for the government, but it's not a political problem," he said. "There may be small conflicts after 2014, but civil war is unlikely. The last time, it was a failure that no one wants to see again."

But a growing number of people are not taking any chances.

"I'm sure if something goes wrong in 2014, I'll face lots of problems," said Nasir. "If the Taliban return to power they'll kill me because I work with the government. If warlords come to power it's bad news for everyone." (Additional reporting by Folad Hamdard in KUNDUZ and David Alexander in WASHINGTON; Editing by Michael Georgy and Michael Perry)

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Connecticut governor says he told parents their children killed

REUTERS - Connecticut Governor Dannel Malloy broke down into tears on Monday as he recalled how, hours after a shooting rampage at a Connecticut elementary school, he took it upon himself to tell parents and other relatives that their children had been killed.

Malloy said he met with a roomful of family members near Sandy Hook Elementary School in Newtown, following the massacre of 20 children and six adults there on Friday and found that many were still waiting for official word on the fate of their loved ones.

"It was evident to me that there was a reluctance to tell parents and loved ones that the person they were waiting for was not going to return," Malloy said in an emotional press conference.

"That had gone on for a period of time well after there was an expectancy that families would be reunited," he added.

Malloy paused several times during his remarks as he choked up and wiped away tears.

"So I made a decision that rather than relying on traditional investigative policies - that you actually have a child or an adult identified as the particular victim before you inform someone or at least give them the information by which they can formulate for themselves that their loved one was not going to return - I made the decision that to have that go on any longer was wrong. I did it," he said.

Malloy spoke to reporters as the funerals of two 6-year-old boys on Monday ushered in a week of memorial services and burials for victims of the mass shooting.

Police said 20-year-old Adam Lanza killed his mother, Nancy, at her home on Friday before shooting his way into the school and opening fire on students and teachers. He shot himself to death in the school following the rampage, authorities say.

He had attended Sandy Hook as a child, according to former classmates. Authorities said on Monday he had no current connection with the school. (Writing by Dan Whitcomb; Editing by Cynthia Johnston and Andrew Hay)

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Shaken US town turns to prayers, churches to fight grief

New York, Dec 16 (PTI) Grief-stricken residents of a US town shaken by the horror of a brutal school shooting sought refuge in the divine today, flocking to churches in hundreds in the face of tragedy as debate shifted strongly towards gun control laws. The people of Newtown were still struggling to come to terms with the Friday incident in which 27 people, most of them kids as young as five or seven years old, were shot dead by a young man who started his killing spree at home with his mother. The Sunday morning prayer services saw a overwhelming rush as the city awaited President Barack Obama, who is set to join its people in their time of grief. Obama is expected to arrive in Newtown to meet the families of victims and to join in the mourning at an evening vigil. The President who called for "meaningful action" to be taken to prevent such tragedies, which he said America has been witnessing far too often, is already being asked to initiate decisive action. New York Mayor Michael Bloomberg lamented lack of action by Obama on stricter gun regulations despite having spoken on this issue several times in the past. "The president should console the country, but he's the commander in chief as well as the consoler in chief, and he calls for action, but he called for action two years ago," Bloomberg said on on NBC. "It's time for the president to stand up, I think, and lead and tell this country what we should do," he said. The mayor of Connecticut's capital city joined in the chorus as he spoke of the need to curb what he called an "incredible appetite" among Americans for guns. Pedro Segarra said Connecticut citizens are "very supportive of demilitarising our community and getting these weapons off the streets." (MORE) PTI WAJ

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Mother, son injured in ceiling collapse

New Delhi, Dec 16 (PTI) A woman and her son were today injured after ceiling of an under-construction building collapsed in a northeast locality. 23-year-old Shahnaz and her son Faiz were on balcony of the fifth floor, which was being constructed "illegally", when its ceiling caved in, police said. They fell on ground floor and got trapped beneath the rubble, a senior police officer said. A case has been registered against contractor of the building, police said adding, he was absconding. PTI ETB SHS

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Govt asks SC collegium to reconsider names of 3 judges for

Sat, Dec 15, 2012 at 23:36

Govt asks SC collegium to reconsider names of 3 judges for

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Govt asks SC collegium to reconsider names of 3 judges for

Govt asks SC collegium to reconsider names of 3 judges for

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Govt asks SC collegium to reconsider names of 3 judges for

Govt asks SC collegium to reconsider names of 3 judges for

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elevation New Delhi, Dec 15 (PTI) Government is learnt to have requested the Supreme Court collegium to reconsider the names of three senior judges it had recommended for elevation to the apex court. Sources said government had written to the collegium headed by the Chief Justice of India Altamas Kabir to once again consider its recommendation to elevate Chief Justices of three High Courts as judges of the Supreme Court. Under the present system, the if collegium sents back the names to the government again, then it is bound to consider them for elevation. PTI NAB SKU VMN

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Check misuse of social networking sites, Gehlot to police

Jaipur, Dec 15 (PTI) Rajasthan Chief Minister Ashok Gehlot today said that to check misuse of social networking websites, police should effectively use the concerned laws. Gehlot was speaking after reviewing a parade here during the 150th anniversary celebrations of Indian Police Service. He said he was in favour of freedom of speech on social media, but it should not be misused. "The police should use laws to tighten the noose around unsocial elements to stop them from uploading communal and seditious content on social sites," Gehlot said. On this occasion, he also announced to open a police training centre in Bharatpur district. The Police Act of 1861 is acknowledged to have marked the start of formal policing in India. PTI Corr SHS/AGL AGL

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