BBC News - Skin cells turned into healthy heart muscle cells

By Emily SelvaduraiHealth reporter, BBC News online

Scientist say they have managed to turn patients' own skin cells into healthy heart muscle in the lab.

The aim is to repair damaged heart muscle using healthy new cells

Ultimately they hope this stem cell therapy could be used to treat heart failure patients.

As the transplanted cells are from the individual patient this could avoid the problem of tissue rejection, they told the European Heart Journal.

Early tests in animals proved promising but the experimental treatment is still years from being used in people.

Experts have increasingly been using stem cells to treat a variety of heart problems and other conditions like diabetes, Parkinsons disease or Alzheimer's.

Stem cells are important because they have the ability to become different cell types, and scientists are working on developing ways to get them to repair or regenerate damaged organs or tissues.

'New and exciting'

More than 750,000 people in the UK have heart failure.

It means the heart is not pumping blood around the body as well as it used to.

Researchers are looking at ways of fixing the damaged heart muscle.

In the latest study, the team in Israel took skin cells from two men with heart failure and mixed the cells up with a cocktail of genes and chemicals in the lab to create the stem cell treatment.

The cells that they created were identical to healthy heart muscle cells. When these beating cells were transplanted into a rat, they started to make connections with the surrounding heart tissue.

Lead researcher Professor Lior Gepstein, said: "What is new and exciting about our research is that we have shown that it's possible to take skin cells from an elderly patient with advanced heart failure and end up with his own beating cells in a laboratory dish that are healthy and young - the equivalent to the stage of his heart cells when just born."

The researchers say more work is needed before they can begin trials in humans.

Dr Mike Knapton of the British Heart Foundation, said: "This is a very promising area of study.

"However, we still have a way to go before these findings could be applied to the clinic."

Reuters News - Exclusive: U.S. lets China bypass Wall Street for Treasury orders

A bank clerk counts U.S. dollar banknotes on bundles of 100 Chinese yuan banknotes at a branch of a bank in Huaibei, Anhui province April 26, 2012.

Credit: Reuters/Stringer

By Emily Flitter

NEW YORK | Mon May 21, 2012 9:01pm EDT

(Reuters) - China can now bypass Wall Street when buying U.S. government debt and go straight to the U.S. Treasury, in what is the Treasury's first-ever direct relationship with a foreign government, according to documents viewed by Reuters.

The relationship means the People's Bank of China buys U.S. debt using a different method than any other central bank in the world.

The other central banks, including the Bank of Japan, which has a large appetite for Treasuries, place orders for U.S. debt with major Wall Street banks designated by the government as primary dealers. Those dealers then bid on their behalf at Treasury auctions.

China, which holds $1.17 trillion in U.S. Treasuries, still buys some Treasuries through primary dealers, but since June 2011, that route hasn't been necessary.

The documents viewed by Reuters show the U.S. Treasury Department has given the People's Bank of China a direct computer link to its auction system, which the Chinese first used to buy two-year notes in late June 2011.

China can now participate in auctions without placing bids through primary dealers. If it wants to sell, however, it still has to go through the market.

The change was not announced publicly or in any message to primary dealers.

"Direct bidding is open to a wide range of investors, but as a matter of general policy we do not comment on individual bidders," said Matt Anderson, a Treasury Department spokesman.

While there is been no prohibition on foreign government entities bidding directly, the Treasury's accommodation of China is unique.

The Treasury's sales of U.S. debt to China have become part of a politically charged public debate about China's role as the largest exporter to the United States and also the country's largest creditor.

The privilege may help China obtain U.S. debt for a better price by keeping Wall Street's knowledge of its orders to a minimum.

Primary dealers are not allowed to charge customers money to bid on their behalf at Treasury auctions, so China isn't saving money by cutting out commission fees.

Instead, China is preserving the value of specific information about its bidding habits. By bidding directly, China prevents Wall Street banks from trying to exploit its huge presence in a given auction by driving up the price.

It is one of several courtesies provided to a buyer in a class by itself in terms of purchasing power. Although the Japanese, for example, own about $1.1 trillion of Treasuries, their purchasing has been less centralized. Buying by Japan is scattered among institutions, including pension funds, large Japanese banks and the Bank of Japan, without a single entity dominating.

Granting China a direct bidding link is not the first time Treasury has gone to great lengths to keep its largest client happy.

In 2009, when Treasury officials found China was using special deals with primary dealers to conceal its U.S. debt purchases, the Treasury changed a rule to outlaw those deals, Reuters reported last June. But at the same time it relaxed a reporting requirement to make the Chinese more comfortable with the amended rule.

Another feature of the U.S.-China business relationship is discretion: The Treasury tried to keep its motivation for the 2009 rule change under wraps, Reuters reported.

Documents dealing with China's new status as a direct bidder again demonstrate the Treasury's desire for secrecy -- in terms of Wall Street and its new direct bidding customer.

To safeguard against hackers, Treasury officials upgraded the system that allows China to access the bidding process.

Then they discussed ways to deflect questions from Wall Street traders that would arise once the auction results began revealing the undeniable presence of a foreign direct bidder.

"Most hold the view that foreign accounts only submit 'indirect bids' through primary dealers. This will likely cause significant chatter on the street and many questions will likely come our way," wrote one government official in an email viewed by Reuters.

In the email, the official suggested providing basic, general answers to questions about who can bid in Treasury actions.

"For questions more extensive or probing in nature, I think it prudent to direct them to the or Treasury public relations area," the official wrote.

The granting to China of direct bidder status may be controversial because some government officials are concerned that China has gained too much leverage over the United States through its large Treasury holdings.

For example, economist Brad Setser, who is a member of the National Economic Council and has also served on the National Security Council, has argued China's large Treasury holdings pose a national security threat.

Writing for the Council on Foreign Relations in 2009, Setser posited that China's massive U.S. debt holdings gave it power over U.S. policy via the threat of a swift, large sale of U.S. debt that could send the market into turmoil and drive up interest rates.

But Treasury officials have long maintained that U.S. debt sales to China are kept separate from politics in a business relationship that benefits both countries. The Chinese use Treasuries to house the dollars they receive from selling goods to the United States, while the U.S. government is happy to see such strong demand for its debt because it keeps interest rates low.

A spokesman for the Chinese embassy in Washington did not respond to calls and emails seeking comment.

The United States has, however, displayed increasing anxiety about China as a cybersecurity threat. The change Treasury officials made to their direct bidding system before allowing access to China was to limit access to the system to a specially designed private network connection controlled by the Treasury.

China is among the most sensitive topics for bankers and government officials who court the country as a financial client because of its size and importance, and none would agree to comment on the record for this story.

A former debt management official at the Treasury who did not want to be identified said that as China's experience in the U.S. Treasury market has deepened over time, Chinese officials may have felt more comfortable taking the reins in the management of their holdings.

Their request to bid directly, in his view, came from a confidence that their money managers could buy U.S. debt more efficiently on their own than through Wall Street banks, which can often drive up the price of Treasuries at an auction if they know how much large clients are willing to pay. Such a practice that is not specifically illegal, though most traders would deem it unethical.

Evidence of China's growing sophistication as a money manager in the U.S. markets is clear in its expansion of operations in New York. Its money management arm, the State Administration for Foreign Exchange (commonly called SAFE), has an office in Midtown Manhattan and a seasoned chief investment officer -- former Pacific Investment Management Co derivatives head Changhong Zhu -- in Beijing.

A woman who answered the phone at SAFE's New York office said no one in the office was authorized to talk to the media.

(Editing by Martin Howell and Steve Orlofsky)

BBC News - SpaceX Falcon rocket set for second launch attempt

By Jonathan AmosScience correspondent, BBC News

SpaceX will try again on Tuesday to launch its re-supply mission to the space station.

The Dragon capsule on top of the Falcon rocket is carrying half a tonne of supplies

The first attempt on Saturday was thwarted by a faulty valve in one of the engines on the California company's Falcon 9 rocket.

The lift-off at the Cape Canaveral Air Force Station in Florida was aborted just half a second before the vehicle was due to leave the pad.

Tuesday's attempt has been scheduled for 03:44 EDT (07:44 GMT; 08:44 BST).

SpaceX is endeavouring to become the first commercial concern to carry cargo to the International Space Station (ISS).

Its Falcon rocket will loft an unmanned capsule called Dragon, which has been loaded with half a tonne of food and spares for the platform's astronauts.

Once in orbit, the Dragon will chase down the station and berth with it. After a week, the ship will return to Earth with equipment that needs to be repaired.

To date, only government-owned vehicles have been used to run this freight service.

But Nasa wants in future to contract out the role to US companies. In a few years, the private sector could even take over the task of ferrying astronauts to and from the station.

The agency hopes these changes will save it money that can then be invested in exploration missions far beyond Earth, at destinations such as asteroids and Mars.

Tough task

SpaceX acted quickly on Saturday to correct the problem in the Falcon's propulsion system.

During the final moments of the weekend's countdown, a flight computer detected slightly high pressures inside the thrust chamber of the vehicle's number five engine - one of nine that power the first stage of the ascent - and commanded a shut-down.

Technicians traced the issue to a check valve that has since been exchanged.

Much is riding on the mission. Many in the US Congress remain to be convinced that the path set for Nasa is the right one.

These politicians doubt the private sector is ready to assume important roles in America's human spaceflight programme; and if SpaceX falls short of its objectives in the coming days, these critics are likely to argue that their position has been vindicated.

But both SpaceX and Nasa have tried to lower expectations ahead of the mission, repeating often that it represents a test flight.

The company has also been stressing the difficulty of what it is trying to achieve.

"Sending a spacecraft to the space station has only ever been accomplished by four entities - the United States, Russia, Japan and the European Union," it said on the eve of Tuesday's launch attempt.

Reuters News - Euro area bonds to be discussed at informal EU summit - officials

By Luke Baker

BRUSSELS | Mon May 21, 2012 8:54am BST

(Reuters) - French President Francois Hollande and like-minded euro zoneleaders are expected to promote the idea of mutualised European debt at an informal summit in Brussels this week, increasing pressure on German Chancellor Angela Merkel to drop her opposition to the proposal.

Senior EU and U.S. officials said Hollande raised the topic of euro area bonds - bonds jointly underwritten by all euro zone member states - during G8 talks at the weekend and would again push it when EU leaders meet in Brussels on May 23.

He is expected to have backing from Italian Prime Minister Mario Monti, Spanish Prime Minister Mariano Rajoy and the European Commission, which has long been a backer of euro area bonds, producing a feasibility study on them late last year before the initiative was pushed to the background.

The rapid deterioration in the euro zone debt crisis over the past month, with Greece's potential exit from the 17-country currency bloc no longer taboo, has brought the idea back to the forefront, with many economists and policymakers arguing it would be one of the best ways of restoring market confidence.

"The euro bonds debate is back front and centre and Hollande will have support from other leaders if he raises it," one EU official said.

"It's not something that's going to happen overnight - there's a lot that needs to fall into place first - but there is a desire for a plan of action toward euro bonds."

The summit on Wednesday is scheduled to focus on growth and investment, with European Council President Herman Van Rompuy wanting leaders to agree specific steps to stimulate growth and create jobs across the EU.

Proposals are expected to include boosting the paid-in capital of the European Investment Bank and plans for 'project bonds' underwritten by the EU budget to finance infrastructure.

The aim is to agree ideas that can be formally signed off at the next summit on June 28-29.

But the victory of Hollande's socialist party in France has not only shifted the euro zone crisis debate more towards growth, while not abandoning austerity, it has also given renewed voice to ideas that Merkel has successfully pushed aside over the past two years, including debt mutualisation.

Merkel has said she is not opposed to jointly underwritten euro area bonds per se, but believes it can only be discussed once the conditions are right, including much closer economic integration and coordination across the euro zone, including on fiscal matters.

That remains a long way off.

In its paper on what it calls "stability bonds", unveiled in November, the Commission said it was not an idea that could be deferred forever, saying the severity of the crisis - which has only worsened since - meant quicker action needed to be taken.

"While common issuance has typically been regarded as a longer-term possibility, the more recent debate has focused on potential near-term benefits as a way to alleviate tension in the sovereign debt market," the paper said.

"In this context, the introduction of Stability Bonds would not come at the end of a process of economic and fiscal convergence, but would come in parallel with further convergence and foster the establishment and implementation of the necessary framework for such convergence."

That is language that Monti, an economist and former European commissioner, has supported in the past and is expected to second in the discussions on Wednesday.

"Whatever the timeframe was before on moving towards euro bonds, it's now even shorter because of the worsening in the crisis," a second EU official said.

"There needs to be a discussion on jobs and growth, but there also needs to be a discussion on specific steps that can be taken towards euro bonds.

Several proposals, aside from the Commission's, have already been circulated for well over a year. One, called a debt redemption fund, was proposed by a group of German 'wise men'.

That proposal would involve mutualising the debts of euro zone countries over and above 60 percent of GDP - the debt limit set out in the EU's stability and growth pact.

Another idea put forward by the Bruegel think tank would involve mutualising all debt up to 60 percent of GDP, with any debt over and above that limit having to be underwritten by the specific country alone.

Economists have argued that the best way of restoring confidence in bonds issued by euro zone sovereigns is for the debt to be collectively underwritten by all the countries. However, that would put a large burden on Germany, the EU's biggest economy, to finance the debts of other member states.

As well as resolving the region's debt problems, EU leaders are also expected to discuss how to tackle a deepening banking crisis, with the banking systems in both Greece and Spain under severe strain.

One idea is to allow the European Financial Stability Facility, the euro zone's 700 billion euro rescue fund, to help recapitalise banks directly, rather than lending to individual countries that then lend it on to the banks.

But Germany opposes direct lending by the EFSF to banks, saying it is up to individual member states to ensure the stability of their banking sectors.

BBC News - Obama: Eurozone 'must focus on jobs and growth'

President Obama: "All the leaders here today agreed growth and jobs must be our top priority"

US President Barack Obama has said there is an "emerging consensus" that European countries must now focus on jobs and growth.

Speaking after the G8 summit of some of the world's leading economies, he said the US was confident that Europe can meet its challenges.

President Obama said leaders had made good progress on a range of issues.

In addition the eurozone crisis, they discussed Iran, Afghanistan and global energy supply.

The leaders of France, Germany, the US, the UK, Italy, Japan, Canada and Russia met at Camp David in the US state of Maryland.

In an earlier communique, G8 leaders committed themselves to promoting growth alongside fiscal responsibility and affirmed that they wanted Greece to stay in the eurozone.

The BBC's Paul Adams at Camp David says both that communique and Mr Obama's speech showed the US and French position had won out over Germany and Britain's pro-austerity stance.

Obama said the meeting had been a success

Energy worries

Leaders attending the summit addressed a number of issues, including energy security, climate change and the situation in Iran, Afghanistan and North Korea.

There was discussion of a broad release of national oil reserves to steady shaky energy markets when tough new sanctions on Iran's oil exports kick in.

President Obama also announced that they had formed a new alliance to focus on food security with African leaders and the private sector.

The focus, however, remained on the crisis in the eurozone.

Speaking to reporters at the end of the summit, President Obama said: "As all of the leaders here today agree, growth and jobs must be our top priority."

Emphasising that the United States had taken this approach to its own financial crisis, he said he was "confident" that European countries were moving in the right direction.

But he acknowledged that the European situation was "more complicated" than America's. Earlier, the G8 leaders said "the right measures are not the same for each of us".

In a statement, the group said it agreed "on the importance of a strong and cohesive eurozone for global stability and recovery, and we affirm our interest in Greece remaining in the eurozone while respecting its commitments".

The global economic recovery was showing signs of progress, they said, but "significant headwinds persist".

For its part, the EU welcomed the G8 communique with its dual emphasis on boosting growth and jobs.

European Commission President Jose Manuel Barroso and European Council President Herman Van Rompuy said both growth-boosting measures and efforts to restore public finance were needed.

"Opposing the two is a false debate," said they said in a joint statement.

Leaders will now turn their thoughts to Afghanistan, as President Obama and other heads of government travel to Chicago for a Nato summit on Sunday.

BBC News - UNDP: Africa must boost food output to maintain growth

Despite high rates of growth across much of Africa, access to food remains a problem

The United Nations Development Programme (UNDP) says Africa needs to boost agricultural productivity if it is to sustain its economic boom.

The report says African economies have registered "impressive growth rates".

But it says sub-Saharan Africa cannot sustain its present economic resurgence unless it eliminates the hunger that affects nearly a quarter of its people.

The situation affects children in particular, with 40% of African children aged under five malnourished.

UNDP Administrator Helen Clark said at the launch of the report in Kenya: "Impressive GDP [gross domestic product] growth rates in Africa have not translated into the elimination of hunger and malnutrition. Inclusive growth and people-centred approaches to food security are needed."

The report says that simply focusing on agriculture will not be enough to reverse the situation.

It calls for new approaches covering multiple sectors, from rural infrastructure to health services, and new forms of social protection and empowering local communities.

"The situation is quite bleak," said Sebastian Levine, a UNDP policy adviser for Africa. "This economic resurgence that we have seen has not really had the impact that we would expect."

The report does, though, highlight some countries where positive action has made a difference.

Ghana has become the first sub-Saharan African country to achieve a Millennium Development Goal on halving hunger by 2015, partly by focusing on policies which encouraged cocoa farmers to boost output.

And Malawi has transformed a food deficit into a 1.3 million tonne surplus within two years, thanks to a massive seed and fertiliser subsidy programme.

Reuters News - G8 leaders look to head off euro zone crisis

By Laura MacInnis and Jeff Mason
WASHINGTON | Fri May 18, 2012 6:06am EDT
(Reuters) - Leaders of major industrial economies meet this weekend to try to tackle a full-blown crisis in Europe where fears are growing that Greece could leave the euro zone bloc, threatening the future of the common currency.

President Barack Obama, the G8 host, has urged European leaders repeatedly to do more to stimulate growth, fearing contagion from the euro crisis that could hurt the U.S. economy and his chances of re-election in November.

British Prime Minister David Cameron, who has been increasingly vocal in urging Europe to do more to resolve the debt crisis, will tell leaders they must work together to stop it from spreading worldwide, an aide said.

No major economic policy decisions are expected from the talks but officials said Obama hoped to promote a discussion on a comprehensive approach to resolving the crisis.

He will seek to cement a bond with France's new leader at the White House later on Friday before heading to Camp David for the talks.

Francois Hollande, sworn in this week as French president, has already made waves by challenging Europe's austerity focus and saying he will pull French combat troops from Afghanistan by the end of this year.

Obama, 50, may use their introductory meeting in the Oval Office to encourage the 57-year-old Socialist to rethink his Afghanistan plans that put France on an earlier exit timetable than other NATO allies.

But the two leaders, who have both expressed support for pro-growth policies in Europe, are expected to form a common front on the euro zone crisis that could dominate this weekend's Group of Eight talks.

Obama's administration spent heavily to tackle the 2007-2009 U.S. recession, and Hollande is seeking to take the edge off austerity with more job-creating infrastructure investments.

He is not alone. Cameron has become increasingly vocal in demanding Europe's leaders act more decisively, Canada's Stephen Harper has been a frequent critic, and of the euro zone G8 members, Italian premier Mario Monti was calling for profound growth measures even before Hollande did.

That could leave Germany's Angela Merkel, who insists debt-cutting programs cannot be diluted, cutting a lonely figure.

The G8 summit comes as Greeks are pulling cash from banks amid growing fears that it might crash out of the single currency euro zone. Financial markets fear for the future of the entire currency zone, with Spain's banking sector also under pressure.

The U.S. dollar climbed, world shares fell and German borrowing costs hit record lows on Friday as a deepening Spanish banking crisis, uncertainty about Greece's future in the euro zone and lackluster U.S. data provoked a rush for safe-haven assets.

Heather Conley, a senior fellow at the Center for Strategic and International Studies, said Hollande and Obama "see things very similarly about the need for a better balance between fiscal consolidation, austerity and economic growth".

One of Obama's closest aides, National Security Adviser Tom Donilon, said the United States welcomed the evolving debate in Europe about the "imperative for jobs and growth", but he said the president's intention was not to drive a wedge between Europe's two biggest economies, Germany and France.

"I don't think that the nature of these conversations are going to be anything like taking one side or the other," he told reporters on Thursday.

"The president looks forward to leading a discussion among the leaders about the imperative of having a comprehensive approach to manage the crisis and get on a sustainable path towards recovery in Europe."

LIMITED POWER

Obama, a Democrat, has pitched a similarly "balanced" approach combining short-term stimulus and longer-term cuts to heal the U.S. economy and stoke hiring that has not recovered from the financial crisis.

His presumed White House opponent, Republican Mitt Romney, has made reducing the U.S. debt load, which has escalated during Obama's tenure, one of his key campaign messages.

"A balanced approach that includes not just austerity but growth and job creation is the right approach," White House spokesman Jay Carney said on Thursday, explaining Obama's message to the G8.

Bruce Jones of the Brookings Institution said because Obama's re-election prospects hinge so directly on the health of the American economy, he has a huge interest in getting Europe on a healthy growth track. "Even if he wasn't in an election season, any president of the United States has a lot riding on the Europeans getting this right," he said.

Cameron, worried about the impact of the euro zone crisis on a weak British economy, will call for a "strong and united commitment to securing the economic recovery and to support job creation," his aide said.

Also on the summit agenda will be the price of oil and policy options to address it, although Brent crude hit a 2012 low on Friday.

"I'm sure that the leaders will discuss the range of options that they might have before them," Donilon said.

Economic policy outcomes are not expected from the closed-door talks at Camp David, a rustic presidential escape about two hours from Washington that Obama has visited far less frequently than his predecessor George W. Bush.

The White House moved the summit to the Maryland retreat from Chicago in part to give the meeting a more informal flavor, as well as to escape the possibility of protests when Russian President Vladimir Putin was slated to attend.

His prime minister, Dmitri Medvedev, will be there instead, along with G8 first-timers Hollande and Yoshihiko Noda of Japan. Monti, Cameron, Harper, Merkel and Obama complete the line-up of leaders and European Commission President Jose Manuel Barroso and European Council President Herman Van Rompuy will also attend.

Van Rompuy held a conference call with the European attendees on Thursday to "coordinate positions".

The White House said each leader would get their own cabin, albeit of different sizes. It will be the largest international summit ever held at Camp David, which was built in the 1930s and is best known as the site of past Middle East peace talks.

Conley of CSIS acknowledged Obama's power to exert influence over Europe over weekend was "somewhat limited".

"Nevertheless, I think the president can play a role of listening, helping leaders find common ground," she said. "We are going to have to watch how this plays out with the frustration in recognizing that it will have a profound impact for the global economy and for the U.S. economy."

(Additional reporting by Caren Bohan in Washington and John Irish in Paris; Editing by Cynthia Osterman, Neil Fullick and Mike Peacock)