Morning Brief, Thursday, August 16

Asia

BERTRAND LANGLOIS/AFP

The United States is reportedly urging Pakistani leader Pervez Musharraf to share power with exiled former PM Benazir Bhutto.

Asian stocks took another dive, and particularly in South Korea. U.S. Treasury Secretary Henry Paulson tells the Wall Street Journal that the selling frenzy in the markets “will extract a penalty on the growth rate,” but the U.S. economy will weather the storm. Only a “calamity” would lead the Fed to cut interest rates, adds Bill Poole of the St. Louis Federal Reserve Bank.

As Chinese officials finally begin to grapple seriously with the safety of its food exports, they may be downplaying the significance of a disease that is spiking the price of Chinese pork. 

U.S. troops are battling al Qaeda again in Afghanistan’s Tora Bora mountains.

Europe

European stocks are following Asian stocks downward. Economic growth in France and Germany slumped in the second quarter of 2007.

France is struggling to make the “TGV of moving sidewalks” work effectively.

Middle East

The U.S. government inked a $30 billion defense pact with Israel. I bet these guys don’t approve.

Iran’s Revolutionary Guards would only grow stronger if the United States branded them a foreign terrorist organization, a top spokesman for the Guards said. Helene Cooper and Nazila Fathi of the New York Times believe the U.S. proposal reflects frustration with the pace of diplomacy at the United Nations. Meanwhile, the Iranian regime is becoming more suspicious of everyone, even the Chinese.

Elsewhere

A huge earthquake rocked Peru, killing over 135 people so far. 

Oil prices are down to the low 70s per barrel. 

The New York Police Department released a 90-page report (pdf) on the threat of homegrown terrorism. 

Today’s Agenda

• Leaders from countries in the Shanghai Cooperation Organization, which includes China, Russia, Kyrgyzstan, Kazakhstan, Uzbekistan and Tajikistan, are to meet in Kyrgyzstan.
• Angela Merkel visits Greenland to see climate change close up.
• Buenos Aires hosts the World Tango championships.
• Today marks 30 years since Elvis Presley died.

Yesterday on Passport

• Somebody at the CIA tweaked Oprah’s Wikipedia entry
• Petraeus releases conclusions of Iraq report … sort of
• Martin Wolf lays the smack down on Jim Cramer