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We feel that Obama must now follow his words with actions.

SPIEGEL: The new US president, who has called your aggressive anti-Israeli remarks "disgusting," has nevertheless spoken of a new beginning in relations with Iran and extended his hand to you. Ahmadinejad: I haven't understood Obama's comments quite that way. I pay attention to what he says today. But that is precisely where I see a lack of something decisive. What leads you to talk about a new beginning? Have there been any changes in American policy? We welcome changes, but they have yet to occur.

Some passages were new, while some repeated well-known positions. I thought it striking that Obama attached such high value to the Iranian civilization, our history and culture. It is also positive that he stresses mutual respect and honest interactions with one another as the basis of cooperation

You are aware that we are not the ones who severed relations with America. America cut off relations with us. What do you expect from Iran now?

that could lead to a resumption of diplomatic relations, perhaps even to the reopening of the embassy, which was occupied in 1979, the year of the revolution? Ahmadinejad: We have not received an official request in this regard yet. If this happens, we will take a position on the matter. This is not a question of form. Fundamental changes must take place, to the benefit of all parties. The American government must finally learn lessons from the past.

We do not commit terror, but we are victims of terror. After the revolution, our president and prime minister were killed in a bombing attack in the building adjacent to my office. Our faith forbids us from engaging in terrorism

we have contributed to stabilization in both Afghanistan and Iraq in recent years. While we were making these contributions, the Bush administration accused us of doing the opposite.

For the past 30 years, Germany and other European countries have been under pressure from the Americans not to improve their relations with Tehran. That's what all European statesmen tell us.

While most international attention is focussed on Iran's uranium enrichment activities, the inauguration of the new plant in Isfahan shifts attention to a parallel programme that also has outside observers worried, BBC diplomatic correspondent Jonathan Marcus reports. Once it is fully operational it could produce sufficient plutonium for two nuclear weapons a year, should Iran choose to separate the plutonium from the reactor's spent fuel, he says.

The newly-opened plant will produce pellets of uranium oxide that could be used to fuel a heavy-water reactor in Arak expected to be completed some time between 2011 and 2013.

It signals Iran has reached the final stage in the nuclear fuel cycle, analysts say.

"The Iranian nation has from the beginning been after logic and negotiations, but negotiations based on justice and complete respect for rights and regulations," Mr Ahmadinejad was quoted as saying on Thursday. "One-sided negotiations, conditional negotiations, negotiations in an atmosphere of threat are not something that any free person would accept," he said.

Iran needs to "convince us all of the exclusively peaceful character of its nuclear programme", Russian Foreign Minister Sergei Lavrov said. On Wednesday, the five permanent UN Security Council members and Germany said they would ask EU foreign policy chief Javier Solana to approach Iran with the talks offer.

Signalling a policy shift, US Secretary of State Hillary Clinton said the US would be a "full participant" in talks. "Obviously we believe that pursuing very careful engagement on a range of issues that affect our interests and the interests of the world with Iran makes senses," she said. "There is nothing more important than trying to convince Iran to cease its efforts to obtain a nuclear weapon."

Iran has so far reacted cautiously to U.S. overtures since Obama took office in January, saying it wants to see a real shift in Washington's policies rather than a change in words. Ahmadinejad said on Wednesday Iran sought "interaction and negotiation based on honor, justice and respect."

Analysts say Iran may be setting tough conditions for dialogue in a bid to buy time. Adding to uncertainty, it holds a presidential vote in June in which Ahmadinejad faces a challenge from a moderate politician seeking detente with the West.

One Iranian analyst said he expected Ahmadinejad to say in Isfahan, where Iran has a uranium conversion facility, that it has perfected the last of several phases of fuel output, with the production of uranium pellets and fuel rods for reactors.

"Turkey is bound to Europe by more than bridges over the Bosporus," he said. "Centuries of shared history, culture and commerce bring you together … and Turkish membership would broaden and strengthen Europe's foundation once more."

It is a demand that US presidents have been making for years -- and it is one that never fails to generate grumblings of disapproval from those in Europe who are opposed to Turkish EU accession -- namely Germany, France and Cyprus. This week is no different, with a slough of German politicians, including Chancellor Angela Merkel, rushing to disagree with Obama. Sarkozy, too, voiced his disapproval.

The Turks know full well that, without the economic advantages bestowed by EU membership, they will have a more difficult time solidifying their position as a moderate Muslim democracy. But their pride can take only so much. Critique from Europe has strengthened the feeling held by many in Turkey that they aren't desired as an EU member. Such a rejection hurts countries looking to wield influence."

"Many in Turkey will have thus been gratified by Ankara's having almost blocked the consensus necessary to name a new NATO secretary general. That feeling, though, is misleading, because Prime Minister Recep Tayyip Erdogan gambled away political capital…. It was not the way for the Turkish leader to win new friends."

"The preview delivered by Turkey in the argument over NATO and Rasmussen is likely enough for the Europeans. It shows what it would be like were Turkey, as an EU member, to turn itself into the ambassador of the Muslim world -- whether on issues of freedom of expression (Muhammad caricatures) or when it comes to any other domestic political issue. Those who have a say in Brussels also have a say in Berlin. Can it possibly be that Paris is the only EU capital to have grasped this truth?"

Britain currently has 8,100 troops in Afghanistan, and is separately considering a larger permanent deployment, which may be facilitated by the imminent drawdown in Iraq. The British contribution to the reinforcements includes 275 troops who were due to return to the UK in July but will now stay until October

The countries agreeing to contribute further help, according to European diplomats, include Poland – which is to send as many as 600 troops – Spain, Croatia, Greece and the Netherlands. Germany is expected to confirm that it will be sending extra troops to the largely peaceful north of Afghanistan for the election on 22 August.

France is sending a further 150 military police to help train Afghan civilian police, arguing that last year it announced a large extra deployment.

America and Britain had become increasingly frustrated at the 28 Nato countries's unwillingness to commit troops to serious fighting against the Taliban in southern and eastern Afghanistan. While yesterday's temporary additions do not mean that Nato countries have committed themselves to a long-term increase in forces, the US claimed there was a definite change of mood.

Before the troops announcement was made, the Afghan president, Hamid Karzai, hastily agreed to review a draft law that allegedly legitimises rape inside marriage for Afghanistan's Shia minority. The review follows phone calls yesterday from Brown and the US secretary of state, Hillary Clinton, as well as warnings from Canada that it will withdraw its troops if the law is passed.

Karzai has agreed to refer the law back to the Ministry of Justice and has committed himself to veto the law if it infringes the human rights of women. He protested yesterday that the law had been misinterpreted by western media and that it did not ban women from leaving their home without the permission of their husband.

Obama is committing an extra 21,000 troops, and possibly another 10,000 later in the year.

in a sign of the persisting tensions inside the 28-nation alliance, the summit at one stage appeared deadlocked over the appointment of Rasmussen, after objections from the Turkish prime minister, Recep Tayyip Erdogan.

Turkey had rejected the nomination because of Rasmussen's defence of Danish newspaper cartoons depicting Muhammad in 2005.

Later, however, Turkey dropped its objections and it was announced that Nato leaders agreed unanimously to appoint Rasmussen as the next head of the alliance.

More significantly from a European perspective, the US agreed to significantly strengthen international oversight of financial markets, with particular attention paid to tax havens, hedge funds and ratings agencies.

It was a move that both Merkel and French President Nicolas Sarkozy insisted upon -- and one which will go a long way toward removing whispers of friction between Obama and Merkel.

Not only did the president pledge a renewal of trans-Atlantic relations -- he also said that he seeks to create a world free of nuclear weapons. "This weekend in Prague," he said, "I will lay out an agenda to seek the goal of a world without nuclear weapons."

"In Europe, there is an anti-Americanism that is at once casual, but can also be insidious. Instead of recognizing the good that America so often does in the world, there have been times where Europeans chose to blame America for much of what's bad…. On both sides of the Atlantic, these attitudes have become all too common. They are not wise."

At the Afghanistan Conference in The Hague earlier this week, Obama was careful not to make any concrete demands for more troops from his European NATO allies. But on Thursday, he seemed willing to tighten the screws slightly. In addition to warning that al-Qaida still posed a threat, he also said, referring to Afghanistan, that "Europe should not simply expect the United States to shoulder the burden alone. This is a joint problem that requires a joint solution."

The response from Sarkozy, who was standing right next to Obama, was swift. "There will be no French military enforcements," the French president said. "We are ready to do more in the field of policing, of gendarmes, in the field of economic aid, to train Afghans."

Other NATO countries on Friday, though, said that they would be willing to send more troops. SPIEGEL ONLINE learned from diplomats attending the NATO summit that British Prime Minister Gordon Brown intends to send several hundred more troops to Afghanistan. Both Belgium and Spain are likewise promising more soldiers, though Spain is reportedly planning to send just 12 additional troops.

Stiglitz: The banks that survived 80 years ago continued to lend money. Today many banks aren't lending money anymore, above all the large investment banks. This will deepen the crisis.

SPIEGEL: The US government's emergency plan is supposed to prevent this, though. The banks receive money from the state so they can continue to give loans. Stiglitz: That's the idea, but it doesn't work. We're just throwing money at them and they pay billions of it out in bonuses and dividends. We taxpayers are being robbed for all intents and purposes in order to reduce the losses that some wealthy people bear. This has to be changed.

SPIEGEL: … and let them go bankrupt? Stiglitz: No, they have to be saved, because the consequences to the monetary system would be incalculable. But as a countermeasure, these institutions have to be nationalized, which even Alan Greenspan is now demanding. Then the government can close those business segments that have nothing to do with lending and make sure that the banks no longer organize esoteric stock deals that they themselves do not understand.

SPIEGEL: Washington sees it that way, too. In particular, it wants countries with strong exports, like Germany, to offer further economic stimulus packages. Do you think that's justified?

Absolutely. Export surpluses are counterproductive in times of economic crisis. They have to be reduced through economic stimulus programs, for example.

I propose that countries with a positive trade balance should stream part of their surplus to the International Monetary Fund. This can then stimulate the economy in developing countries or prevent the economy from collapsing in Eastern Europe.

The Americans have always been masters at changing a supposed regulation measure into further deregulation.

They want to focus on tougher regulation of the financial community. They want the summit to start re-writing the global rulebook on capitalism.

The intriguing thing is that the economic crisis and Brown's lining up with Obama, who has proclaimed his belief in the enduring "special relationship" with Britain, has revived the Franco-German alliance which used to dominate EU affairs and which had seemed to wither under Merkel and Sarkozy. She doesn't like his touchy-feely ways, he finds her incremental style of politics frustrating. They had drifted apart, but they are back sharing a political tent.

The big question on the fiscal stimulus front is: What will China do?

Brown's hope is that China, worried about the safety of its money invested in the U.S., will be ready to commit extra funds to fighting the world recession. But if he agrees to do so, President Hu Jintao will surely exact a price.

If China comes up with the money to help, it will need assurances that it will in the future enjoy greater power within such multilateral institutions as the IMF and the World Bank. The U.S. and Europe, who have dominated the G-8, now have little option too but to accept a new world order.

Whatever the outcome in London it is unlikely now that the G-8 alone will ever carry the same sway. And not surprisingly, Italian Prime Minister Silvio Berlusconi, who hosts this summer's G-8 in Sardinia, has proposed that its gathering should be immediately followed by one of the G-20.

The new goal, according to American military planners and NATO-nation diplomats, is to produce an Afghan Army of some 220,000 troops and an enlarged police force of 180,000.

Europeans will also concentrate on the “civilian surge” to help create functioning Afghan political, judicial and security structures in the countryside.

The Mullen-Ashkenazi axis, like similar axes between heads of the two countries' intelligence communities, allows the Americans to sense the genuine atmosphere beneath the public propaganda disseminated in Israel and to understand the extent to which Israel is really concerned about the Iranian nuclear threat. It also affords them the opportunity to reassure, to delay and, at the very least, to walk the hidden line between the desire not to officially know in advance, in order to safeguard the ability to shrug off responsibility, and the need not to be surprised.

Make no mistake about the Obama administration, when it comes to Iran: Its policy differs from that of the Bush administration only in style, not in content. Its officials express themselves in positive terms, cloaked in an expression of conciliation, as opposed to the angry face worn by president George W. Bush - but the conclusions are similar, as are the results. Gary Samore, who Jones put in charge of coordinating the issue of weapons of mass destruction, said often, before his appointment, including during a speech at the Herzliya Conference in 2007, organized by Uzi Arad (today Benjamin Netanyahu's national security advisor), that the Iranians will continue their efforts to obtain nuclear weapons and that economic and diplomatic pressure will not help.

Ashton Carter, recently nominated by the president to be under secretary of defense for acquistion, technology and logistics, offered a similar analysis for the Bush administration, when he outlined three alternatives to confronting Iran. Plan B3, the military option, also entailed a possible bombing of Iranian oil installations, which are not protected and concealed like components of the nuclear infrastructure. The prevailing balance of power within the Obama administration tends to favor attacking Iran's nuclear installations, or to tolerate an Israeli attack. A prominent opponent of using military force against Iran, Charles Freeman, who had been slated to head the U.S. National Intelligence Council, was dropped under pressure of Israel's American supporters.

Obama will wait - not only for Iranian elections, scheduled for June (and those in Lebanon, that same month), but also for September's elections in Germany, and for Britons to vote at more or less the same time (elections have yet to be scheduled), in order to know who will stand by his side in the trenches. In that way 2009 will pass without a decision, but not all of 2010, because come that November, Congressional elections will be held, immediately after which the Democrats will begin organizing Obama's reelection campaign. The summer of 2010 will be critical, because by then the evacuation of most of the American forces from Iraq will be completed and fewer exposed targets will remain for Iranian revenge attacks.

The development of the Iron Dome system for intercepting Katyusha rockets, whose first battery will protect the environs north of the Gaza Strip (Ashkelon, Sderot), is expected to be completed by the summer of 2010. That will make it difficult for Hamas to open another front to harass the IDF on Iran's behalf. In the coming months, the tests of the Arrow missile defense system will continue, in a scenario that simulates an attack by a long-distance Iranian missile. The tests will be carried out in cooperation with American systems, including the large radar facility at the Nevatim air base. Preparations for defence against a radioactive attack will also improve, at an event to be staged at either an Israeli or an American port, as will preparations for a plague of smallpox, in a joint exercise involving Israel and one of NATO's important European member states.

In the Pentagon's most recent report about the strengthening of China, Israel receives a pat on the back, of the kind given to a well-behaved child: It has been cured of the habit of providing air-to-ground Harpy missiles to China, which extend the Chinese air force's operational range, and has also enforced stricter export supervision. The Americans are displaying a false naivete: Nothing has changed except for two offices having been moved around administratively. The decision to launch a military operation against Iran, particularly using American-made planes (such as the F-16, whose supply was suspended after Israel's 1981 attack on the Iraqi nuclear reactor), will have to be preceded by feelers to discern where Obama stands exactly on the continuum between approval and opposition. Apparently Israel wants Obama to emerge sufficiently strengthened from this week's NATO summit, but still too weak to say no to Israel.

But the authors of Tracking GhostNet argue that things may not be as they seem in the world of electronic espionage. "We're a bit more careful about it, knowing the nuance of what happens in the subterranean realms," said Ronald Deibert from the University of Toronto. "This could well be the CIA or the Russians.

The 10-month investigation also detected bugged computers in the foreign ministries of several countries, including Iran and Indonesia, and in the embassies of India, South Korea, Taiwan, Portugal, Germany and Pakistan

ultimately I concluded, in The War of the World, that three factors made the location and timing of lethal organized violence more or less predictable in the last century. The first factor was ethnic disintegration: Violence was worst in areas of mounting ethnic tension. The second factor was economic volatility: The greater the magnitude of economic shocks, the more likely conflict was. And the third factor was empires in decline: When structures of imperial rule crumbled, battles for political power were most bloody.

In at least one of the world’s regions—the greater Middle East—two of these three factors have been present for some time: Ethnic conflict has been rife there for decades, and following the difficulties and disappointments in Iraq and Afghanistan, the United States already seems likely to begin winding down its quasi-imperial presence in the region. It likely still will.

no matter how low interest rates go or how high deficits rise, there will be a substantial increase in unemployment in most economies this year and a painful decline in incomes. Such economic pain nearly always has geopolitical consequences. Indeed, we can already see the first symptoms of the coming upheaval.

In the essays that follow, Jeffrey Gettleman describes Somalia’s endless anarchy, Arkady Ostrovsky analyzes Russia’s new brand of aggression, and Sam Quinones explores Mexico’s drug-war-fueled misery. These, however, are just three case studies out of a possible nine or more.