According to LiveScience, the discovery was made in 2010 by one of Saturno’s undergraduate students during a field study of Xultun, an ancient Mayan city in Gautemala. The student noticed black and red paint in a trench that was most likely dug by looters. Saturno decided to investigate the room that the looters had failed to penetrate.

Saturno was pleasantly surprised to find a well-preserved painting of a Mayan king and his subjects. On the east wall of the room was a set of hieroglyphs that would later be analyzed as a new Mayan calendar. It’s been suggested than an ancient Mayan scribe must have used this room to work and wrote the calender on the wall as a reference.

The Mayans split their year into 13, 400-year sections called baktuns. However, the newly discovered wall calendar shows that Mayan’s conceptualized time in up to cycles of 17 baktuns. Mayan scholars have known for a while that the Mayan calendar doesn’t end but rather begins anew after the 13th baktuns. This new discover confirms that Mayans believed that the world would still exist long after the 13th baktun ends in December 2012.

As Anthony Aveni of Colgate University said, reports the Associated Press, “Why would they go into those numbers if the world is going to come to an end this year? You could say a number that big at least suggests that time marches on.” Aveni has a point: the calendar suggests that Earth will still be around for at least 6,000 years after 2012. By Kevin Lewis, Celebrity Cafe

Spot gold hit a session low at $1559,81 an ounce, its lowest since late December 2011, before recovering slightly to trade at $1561,81 an ounce at 10am GMT, down 1,1% from $1578,30 late in New York on Friday.

Gold has moved in tandem with riskier assets this year as the turmoil in Europe sent the euro to multi-month lows and investors turned to the safety of the dollar, analysts said.

“Gold is under severe pressure. The US dollar is being seen as a safe haven at the moment and as long as the dollar is appreciating against the euro this is clearly weighing on the gold price,” said Daniel Briesemann, analyst at Commerzbank.

“I wouldn’t be surprised if we test the December low of around $1520 an ounce and if we don’t stop here we could go below $1500.”

Concerns about the euro-zone crisis resurfaced after coalition talks in Greece hit an impasse on Sunday and Greece’s radical leftist leader spurned an invitation from the president for a final round of talks on Monday, all but ensuring another election next month.

The euro fell to a near four-month low against the dollar, which rose against a basket of currencies. A strong dollar makes commodities priced in the US unit more expensive for holders of other currencies.

Also weighing on sentiment for the precious metal, money managers in gold futures and options cut their net long positions by 20% to the lowest level since December 2008, as investors aggressively unwound their bullish bets in the precious metal after a sharp price pullback.

US gold for June slipped 1,4% to $1561,90 an ounce.

Reflecting risk aversion in financial markets, European shares fell to their lowest levels in more than four months, while safe haven German bund futures hit record highs.

Investors had turned to gold as a safe haven during the debt crisis last year, sending prices to an all-time high of around $1920 an ounce. But this year, gold is trading more in line as a commodity that moves in the opposite direction to the US dollar.

PLATINUM, PALLADIUM TO RISE

Spot platinum fell 0,8% to $1446,75 an ounce, while spot palladium fell 0,6% to $593,50 an ounce.

Prices of platinum and palladium are expected to end the year well above current levels, a Reuters poll conducted for Platinum Week showed, as constraints on supply and improving demand tighten the market.

Spot silver fell 1,5% to $28,40.

Sentiment was also dampened by China’s move on Saturday to loosen monetary policy which underscored how Europe’s plight is hampering global growth.

The People’s Bank of China cut the amount of cash that banks must hold as reserves on Saturday, freeing an estimated 400bn yuan ($63,5bn) for lending to add to the roughly 800 billion injected in two previous 50 bps cuts since the government tilted its policy stance towards growth in October.

In the physical market, jewellery makers and speculators took advantage of last week’s drop in prices.

“We’ve seen physical buying interest. But people are still bearish about the market because of the strong dollar and worries that Greece won’t be able to solve its problems,” said a dealer in Hong Kong.

“Investors are not so aggressive, and I think the jeweller sector is more important. Supply is a bit tight in the physical market.” By Harpreet Bhal, Business Day

Some big name billionaires have announced that they are starting a company to mine asteroids, but is that business idea feasible? Is there an opportunity waiting to be taken in outer space? Stephen Dattels, with over 25 years of experience in the mining exploration and resources financing industry, weighs in on the subject.

Any minerals mined in space would not be economically feasible for use in our planet’s factories due to the immense cost of transporting them back to the earth’s surface. Stephen Dattels still finds an abundance of terrestrial opportunities for mining and financing, which is why he founded Polo Resources Limited: to find and invest in the numerous undervalued resource companies and projects waiting for intelligent investment.

Stephen Dattels On The Opportunities Available On Earth

Stephen Dattels has a proven record as a chief executive in mineral exploration. For example, as the CEO of West African Minerals Limited, Stephen Dattels is overseeing the exploration of over 6,000 square kilometers of mineral rich ground. Why should investment dollars be chasing opportunities in space when they exist on Earth?

While celebrity billionaires look to the stars for mineral exploration and financing, Stephen Dattels continues to make sound investments on Earth that increase value for his shareholders.

Coalition talks in Greece hit an impasse on Sunday and Greece’s radical leftist leader spurned an invitation from the president for a final round of talks on Monday, all but ensuring a new election.

Adding to the negative tone, German Chancellor Angela Merkel’s conservatives suffered a crushing defeat on Sunday in an election in Germany’s most populous state, a result which could embolden the left opposition to step up attacks on her European austerity policies.

The euro seems likely to head lower in coming weeks, especially since the European Central Bank may eventually adopt further monetary easing steps to support the region’s economy, said Akira Hoshino, chief manager for Bank of Tokyo-Mitsubishi UFJ’s foreign exchange trading department in Tokyo.

“I think they will steer the rudder that way, even if that leads to costs on the inflation front. If that is the case, the direction would be toward weakness in the currency,» he said.

The euro dipped to $1.2878 at one point on trading platform EBS, its lowest level since Jan. 23. It last stood at $1.2891, down 0.2 percent from late US trade on Friday.

The euro has come under pressure after Greece’s two main pro-bailout parties failed to win a majority in elections earlier in May, leaving questions over the country’s ability to avert bankruptcy and stay in the euro.

Underscoring increasingly bearish market sentiment toward the euro, data from the US Commodity Futures Trading Commission showed currency speculators increased their net short positions in the euro in the week ended May 8 to the highest level since mid-February.

Traders and analysts say the speed of the euro’s fall versus the dollar is likely to remain relatively slow.

“Corporates based in the eurozone are still strong buyers of the euro (versus the dollar),» said Gareth Berry, G10 FX strategist for UBS in Singapore.

“They see the euro’s current level as quite attractive. In some cases they see it as a bargain, and that’s one thing that has helped minimize or at least cushion the blow to the euro,» he said, adding that analysts at UBS expect the euro to dip to $1.25 in three months’ time.

The safe haven dollar rose broadly, while currencies sensitive to shifts in risk appetite came under pressure.

The New Zealand dollar hit a four-month low of $0.7795, while the Australian dollar dipped below parity versus the US dollar for the first time in about five months, slipping to as low as $0.9996.

The Aussie dollar was last down 0.1 percent at $1.0017 .

The US dollar edged up 0.1 percent versus the yen to 80.03 yen, supported by dollar buying by Japanese importers.

Traders said the dollar also gained some support versus the yen after Japanese Prime Minister Yoshihiko Noda told The Wall Street Journal over the weekend that all options were on the table for dealing with the strong yen, although he stopped short of saying that the currency was overvalued. Kathimerini

The material in the course, which officers could elect to take but was not obligatory, flew in the face of repeated assertions by the Obama administration that the war on terrorism is just that and should under no circumstances be read as an assault on a religion observed by 1.4 billion people around the world.

Details of the course were obtained by a blog on Wired.com, drawn from a presentation given by the teacher, Lt. Col. Matthew Dooley, in July last year.  He suggested that destroying Islamic holy sites would follow the precedents of the nuclear strike by the allies on Hiroshima in World War II and the firebombing of Dresden. His course was called ‘Perspectives on Islam and Islamic Radicalism’.

It was suspended in April after the Pentagon received a complaint from a student and Lt. Col. Dooley, while still at the College, no longer has any teaching duties.  The FBI, meanwhile, has revealed that it too has recently been forced to revise some of its instructional materials to excise references that could have been insulting to Islam.

“It was just totally objectionable, against our values, and it wasn’t academically sound,” the Chairman of the Joint Chiefs, General Martin Dempsey, said at a press conference at the Pentagon. “This wasn’t about … pushing back on liberal thought; this was objectionable, academically irresponsible.”

Dooley offered a theoretical war plan based on the need for “a direct ideological and philosophical confrontation with Islam”. In his presentation, he said: “They hate everything you stand for and will never coexist with you, unless you submit”. He added that as America waged that war it would be free to ignore provisions of the Geneva Convention that sets the rules for armed conflict as “no longer relevant”.

“This would leave open the option once again of taking war to a civilian population wherever necessary (the historical precedents of Dresden, Tokyo, Hiroshima, Nagasaki being applicable…).”  Saying Islam has already declared war on the US, Dooley called the current American stance of seeking common ground with Islamic leaders around the world as “illogical” and the better option was “waging ‘near total war’”.

“We have now come to understand that there is no such thing as ‘moderate Islam’,” Dooley said in the July presentation. “It is therefore time for the United States to make our true intentions clear. This barbaric ideology will no longer be tolerated. Islam must change or we will facilitate its self-destruction.”

Offered five times a year for groups of 20 at a time, the course may have been taught to as many as 800 mid-level and senior US military officers before the Pentagon closed it down.  Lt. Col. Dooley was himself a highly decorated officer who had served in Iraq, Bosnia and Kuwait among others. By David Usborne, The Independent

From the Atlantic to the Pacific, Argentina to the Philippines, here are the six areas of conflict — all tied to energy supplies — that have made news in just the first few months of 2012:

* A brewing war between Sudan and South Sudan: On April 10th, forces from the newly independent state of South Sudan occupied the oil center of Heglig, a town granted to Sudan as part of a peace settlement that allowed the southerners to secede in 2011.  The northerners, based in Khartoum, then mobilized their own forces and drove the South Sudanese out of Heglig.  Fighting has since erupted all along the contested border between the two countries, accompanied by air strikes on towns in South Sudan.  Although the fighting has not yet reached the level of a full-scale war, international efforts to negotiate a cease-fire and a peaceful resolution to the dispute have yet to meet with success.

This conflict is being fueled by many factors, including economic disparities between the two Sudans and an abiding animosity between the southerners (who are mostly black Africans and Christians or animists) and the northerners (mostly Arabs and Muslims).  But oil — and the revenues produced by oil — remains at the heart of the matter.  When Sudan was divided in 2011, the most prolific oil fields wound up in the south, while the only pipeline capable of transporting the south’s oil to international markets (and thus generating revenue) remained in the hands of the northerners.  They have been demanding exceptionally high “transit fees” — $32-$36 per barrel compared to the common rate of $1 per barrel — for the privilege of bringing the South’s oil to market.  When the southerners refused to accept such rates, the northerners confiscated money they had already collected from the south’s oil exports, its only significant source of funds.  In response, the southerners stopped producing oil altogether and, it appears, launched their military action against the north.  The situation remains explosive.

* Naval clash in the South China Sea: On April 7th, a Philippine naval warship, the 378-foot Gregorio del Pilar, arrived at Scarborough Shoal, a small island in the South China Sea, and detained eight Chinese fishing boats anchored there, accusing them of illegal fishing activities in Filipino sovereign waters.  China promptly sent two naval vessels of its own to the area, claiming that the Gregorio del Pilar was harassing Chinese ships in Chinese, not Filipino waters.  The fishing boats were eventually allowed to depart without further incident and tensions have eased somewhat.  However, neither side has displayed any inclination to surrender its claim to the island, and both sides continue to deploy warships in the contested area.

As in Sudan, multiple factors are driving this clash, but energy is the dominant motive.  The South China Sea is thought to harbor large deposits of oil and natural gas, and all the countries that encircle it, including China and the Philippines, want to exploit these reserves.  Manila claims a 200-nautical mile “exclusive economic zone” stretching into the South China Sea from its western shores, an area it calls the West Philippine Sea; Filipino companies say they have found large natural gas reserves in this area and have announced plans to begin exploiting them.  Claiming the many small islands that dot the South China Sea (including Scarborough Shoal) as its own, Beijing has asserted sovereignty over the entire region, including the waters claimed by Manila; it, too, has announced plans to drill in the area.  Despite years of talks, no solution has yet been found to the dispute and further clashes are likely.

* Egypt cuts off the natural gas flow to Israel: On April 22nd, the Egyptian General Petroleum Corporation and Egyptian Natural Gas Holding Companyinformed Israeli energy officials that they were “terminating the gas and purchase agreement” under which Egypt had been supplying gas to Israel.  This followed months of demonstrations in Cairo by the youthful protestors who succeeded in deposing autocrat Hosni Mubarak and are now seeking a more independent Egyptian foreign policy — one less beholden to the United States and Israel.  It also followed scores of attacks on the pipelines carrying the gas across the Negev Desert to Israel, which the Egyptian military has seemed powerless to prevent.

Ostensibly, the decision was taken in response to a dispute over Israeli payments for Egyptian gas, but all parties involved have interpreted it as part of a drive by Egypt’s new government to demonstrate greater distance from the ousted Mubarak regime and his (U.S.-encouraged) policy of cooperation with Israel.  The Egyptian-Israeli gas link was one of the most significant outcomes of the 1979 peace treaty between the two countries, and its annulment clearly signals a period of greater discord; it may also cause energy shortages in Israel, especially during peak summer demand periods.  On a larger scale, the cutoff suggests a new inclination to use energy (or its denial) as a form of political warfare and coercion.

* Argentina seizes YPF: On April 16th, Argentina’s president, Cristina Fernández de Kirchner, announced that her government would seize a majority stake in YPF, the nation’s largest oil company.  Under President Kirchner’s plans, which she detailed on national television, the government would take a 51% controlling stake in YPF, which is now majority-owned by Spain’s largest corporation, the energy firm Repsol YPF.  The seizure of its Argentinean subsidiary is seen in Madrid (and other European capitals) as a major threat that must now be combated.  Spain’s foreign minister, José Manuel García Margallo, said that Kirchner’s move “broke the climate of cordiality and friendship that presided over relations between Spain and Argentina.”  Several days later, in what is reported to be only the first of several retaliatory steps, Spain announced that it would stop importing biofuels from Argentina, its principal supplier — a trade worth nearly $1 billion a year to the Argentineans.

As in the other conflicts, this clash is driven by many urges, including a powerful strain of nationalism stretching back to the Peronist era, along with Kirchner’s apparent desire to boost her standing in the polls.  Just as important, however, is Argentina’s urge to derive greater economic and political benefit from its energy reserves, which include the world’s third-largest deposits of shale gas.  While long-term rival Brazil is gaining immense power and prestige from the development of its offshore “pre-salt”petroleum reserves, Argentina has seen its energy production languish.  Repsol may not be to blame for this, but many Argentineans evidently believe that, with YPF under government control, it will now be possible to accelerate development of the country’s energy endowment, possibly in collaboration with a more aggressive foreign partner like BP or ExxonMobil.

* Argentina re-ignites the Falklands crisis: At an April 15th-16th Summit of the Americas in Cartagena, Colombia — the one at which U.S. Secret Service agents were caught fraternizing with prostitutes — Argentina sought fresh hemispheric condemnation of Britain’s continued occupation of the Falkland Islands (called Las Malvinas by the Argentineans).  It won strong support from every country present save (predictably) Canada and the United States.  Argentina, which says the islands are part of its sovereign territory, has been raising this issue ever since it lost a war over the Falklands in 1982, but has recently stepped up its campaign on several fronts — denouncing London in numerous international venues and preventing British cruise ships that visit the Falklands from docking in Argentinean harbors.  The British have responded by beefing up their military forces in the region and warning the Argentineans to avoid any rash moves.

When Argentina and the U.K. fought their war over the Falklands, little was at stake save national pride, the stature of the country’s respective leaders (Prime Minister Margaret Thatcher vs. an unpopular military junta), and a few sparsely populated islands.  Since then, the stakes have risen immeasurably as a result of recent seismic surveys of the waters surrounding the islands that indicated the existence of massive deposits of oil and natural gas.  Several UK-based energy firms, including Desire Petroleum and Rockhopper Exploration, have begun off-shore drilling in the area and have reported promising discoveries.  Desperate to duplicate Brazil’s success in the development of offshore oil and gas, Argentina claims the discoveries lie in its sovereign territory and that the drilling there is illegal; the British, of course, insist that it’s their territory.  No one knows how this simmering potential crisis will unfold, but a replay of the 1982 war — this time over energy — is hardly out of the question.

* U.S. forces mobilize for war with Iran: Throughout the winter and early spring, it appeared that an armed clash of some sort pitting Iran against Israel and/or the United States was almost inevitable.  Neither side seemed prepared to back down on key demands, especially on Iran’s nuclear program, and any talk of a compromise solution was deemed unrealistic.  Today, however, the risk of war has diminished somewhat – at least through this election year in the U.S. — as talks have finally gotten under way between the major powers and Iran, and as both have adopted (slightly) more accommodating stances.  In addition, U.S. officials have been tamping down war talk and figures in the Israeli military and intelligence communities have spoken out against rash military actions.  However, the Iranians continue to enrich uranium, and leaders on all sides say they are fully prepared to employ force if the peace talks fail.

For the Iranians, this means blocking the Strait of Hormuz, the narrow channel through which one-third of the world’s tradable oil passes every day.  The U.S., for its part, has insisted that it will keep the Strait open and, if necessary, eliminate Iranian nuclear capabilities.  Whether to intimidate Iran, prepare for the real thing, or possibly both, the U.S. has been building up its military capabilities in the Persian Gulf area, deploying two aircraft carrier battle groupsin the neighborhood along with an assortment of air and amphibious-assault capabilities.

One can debate the extent to which Washington’s long-running feud with Iran is driven by oil, but there is no question that the current crisis bears heavily on global oil supply prospects, both through Iran’s threats to close the Strait of Hormuz in retaliation for forthcoming sanctions on Iranian oil exports, and the likelihood that any air strikes on Iranian nuclear facilities will lead to the same thing.  Either way, the U.S. military would undoubtedly assume the lead role in destroying Iranian military capabilities and restoring oil traffic through the Strait of Hormuz. This is the energy-driven crisis that just won’t go away.

How Energy Drives the World

All of these disputes have one thing in common: the conviction of ruling elites around the world that the possession of energy assets — especially oil and gas deposits — is essential to prop up national wealth, power, and prestige.

This is hardly a new phenomenon.  Early in the last century, Winston Churchill was perhaps the first prominent leader to appreciate the strategic importance of oil.  As First Lord of the Admiralty, he converted British warships from coal to oil and then persuaded the cabinet to nationalize the Anglo-Persian Oil Company, the forerunner of British Petroleum (now BP).  The pursuit of energy supplies for both industry and war-fighting played a major role in the diplomacy of the period between the World Wars, as well as in the strategic planning of the Axis powers during World War II.  It also explains America’s long-term drive to remain the dominant power in the Persian Gulf that culminated in the first Gulf War of 1990-91 and its inevitable sequel, the 2003 invasion of Iraq.

The years since World War II have seen a variety of changes in the energy industry, including a shift in many areas from private to state ownership of oil and natural gas reserves.  By and large, however, the industry has been able to deliver ever-increasing quantities of fuel to satisfy the ever-growing needs of a globalizing economy and an expanding, rapidly urbanizing world population.  So long as supplies were abundant and prices remained relatively affordable, energy consumers around the world, including most governments, were largely content with the existing system of collaboration among private and state-owned energy leviathans.

But that energy equation is changing ominously as the challenge of fueling the planet grows more difficult.  Many of the giant oil and gas fields that quenched the world’s energy thirst in years past are being depleted at a rapid pace.  The new fields being brought on line to take their place are, on average, smaller and harder to exploit.  Many of the most promising new sources of energy — like Brazil’s “pre-salt” petroleum reserves deep beneath the Atlantic Ocean, Canadian tar sands, and American shale gas – require the utilization of sophisticated and costly technologies.  Though global energy supplies are continuing to grow, they are doing so at a slower pace than in the past and are continually falling short of demand.  All this adds to the upward pressure on prices, causing anxiety among countries lacking adequate domestic reserves (and joy among those with an abundance).

The world has long been bifurcated between energy-surplus and energy-deficit states, with the former deriving enormous political and economic advantages from their privileged condition and the latter struggling mightily to escape their subordinate position.  Now, that bifurcation is looking more like a chasm.  In such a global environment, friction and conflict over oil and gas reserves — leading to energy conflicts of all sorts — is only likely to increase.

Looking, again, at April’s six energy disputes, one can see clear evidence of these underlying forces in every case.  South Sudan is desperate to sell its oil in order to acquire the income needed to kick-start its economy; Sudan, on the other hand, resents the loss of oil revenues it controlled when the nation was still united, and appears no less determined to keep as much of the South’s oil money as it can for itself.  China and the Philippines both want the right to develop oil and gas reserves in the South China Sea, and even if the deposits around Scarborough Shoal prove meager, China is unwilling to back down in any localized dispute that might undermine its claim to sovereignty over the entire region.

Egypt, although not a major energy producer, clearly seeks to employ its oil and gas supplies for maximum political and economic advantage — an approach sure to be copied by other small and mid-sized suppliers.  Israel, heavily dependent on imports for its energy, must now turn elsewhere for vital supplies or accelerate the development of disputed, newly discovered offshore gas fields, a move that could provoke fresh conflict with Lebanon, which says they lie in its own territorial waters.  And Argentina, jealous of Brazil’s growing clout, appears determined to extract greater advantage from its own energy resources, even if this means inflaming tensions with Spain and Great Britain.

And these are just some of the countries involved in significant disputes over energy.  Any clash with Iran — whatever the motivation — is bound to jeopardize the petroleum supply of every oil-importing country, sparking a major international crisis with unforeseeable consequences.  China’s determination to control its offshore hydrocarbon reserves has pushed it into conflict with other countries with offshore claims in the South China Sea, and into a similar dispute with Japan in the East China Sea.  Energy-related disputes of this sort can also be found in the Caspian Sea and in globally warming, increasingly ice-free Arctic regions.

The seeds of energy conflicts and war sprouting in so many places simultaneously suggest that we are entering a new period in which key state actors will be more inclined to employ force — or the threat of force — to gain control over valuable deposits of oil and natural gas.  In other words, we’re now on a planet heading into energy overdrive. By Michael T. Klare, Counterpunch

The bombings were the deadliest attacks in the Syrian capital, Damascus, since an uprising against President Bashar al-Assad began 14 months ago.

“The United States condemns in the strongest terms the attacks that took place today in Damascus,” the U.S. embassy said in statements posted on Twitter.

“The indiscriminate targeting and killing of civilians is reprehensible and unacceptable in any context,” it said.

The U.S. embassy in Damascus was closed earlier this year when tensions between the two countries rose as Washington voiced support for the revolt against Assad’s rule.

The United States has criticized Assad for not sticking to a ceasefire deal and peace plan brokered by special envoy Kofi Annan. International observers say both rebels and the government have violated the agreement as violence continued.

“We continue to call on the Syrian regime to fully and immediately implement the Annan plan,” the U.S. embassy in Lebanon said. Yahoo Daily News

“If we say no to everything, we leave the eurozone,” said Gikas Hardouvelis, economic advisor to outgoing Prime Minister Lucas Papademos.

Voters roundly rejected austerity measures in Sunday’s elections, booting out a coalition by the two mainstream parties and leaving the radical left-wing Syriza party charged with forming a government.

Its leader Alexis Tsipras was planning to write Wednesday to the highly indebted nation’s international lenders telling them that the country would renege on its austerity commitments.

Hardouvelis said on Skai Radio that Greece “has room for renegotiation” of austerity measures that it had agreed to take by 2015 under the bailout deal, “but we should not oversell it and think that suddenly something has changed in Europe because the people here have shouted no”.

“We have seen the reactions of European leaders… The only thing they are saying is that Greece is heading towards the exit of the euro,” said the former banker, adding that it was up to Greeks see their partners’ logic “because it is them who are giving the money”.

General elections on Sunday did not produce a clear winner but gave an overwhelming boost to Syriza which now has 52 deputies in parliament.

The main parties that have pledged to continue deficit-cutting reforms — New Democracy and socialist Pasok — now only send a combined 149 MPs to the 300-seat parliament, not enough for a re-run of the outgoing coalition.

On Monday, the International Monetary Fund said it was waiting for a new government to be formed in Greece before deciding on how to move forward.

Hardouvelis said “there are questions on securing” the latest tranche of international loans which the Kathimerini daily put at 5.2 billion euro ($6.74 billion).

“Why would they give us money?” if Greece broke its commitments, he said.

Even if the country relinquished servicing its debt by forgoing European money, “it could not do it, because we couldn’t pay wages and pensions,” warned Hardouvelis.

“Someone has to give us money”, otherwise “the country will collapse, closing borders… this is what we are trying to avoid.”

He said the presidential election victory in France of Socialist Francois Hollande was going contribute to an “emphasis on recovery and growth” in Europe, not just belt-tightening.

“But I do not see the Germans retreat on the stability pact” imposing rigid fiscal discipline on euro members, while the French could not afford the luxury of defying the markets which would see their debt costs soar, he said.

Meanwhile, analysts said political limbo in Greece over demands for renegotiation of debt rescues puts the country close to the eurozone exit and also poses grave dilemmas for the EU and notably Germany.

At UniCredit, a senior economist Gillian Edgeworth expressed a view broadly in line with the thrust of comments by several analysts. She said that official lenders to Greece must be in “emergency mode” and “working hard towards a solution.”

If Greece opted out of the eurozone, it would opt for a “large devaluation, spiralling inflation and a double-digit decline in gross domestic product.”

It would also choose “capital controls which will limit any movement of funds offshore” and “bank closures to facilitate re-denomination” and “widespread private sector defaults.”

“Meanwhile there is no guarantee that a bank run in Greece, were it to materialise, would not spill over to elsewhere in EMU (the eurozone),” she said.

Analysts agreed that the renewal of debt tension would undermine prospects for growth in Europe.

As political parties in Athens negotiate on the future of their country, and as the economically vital summer tourist season approaches, they also confront the European Union and International Monetary Fund with a central dilemma.

This is whether and how to compromise on rescue conditions, which new form of guarantees they could obtain in return, and the risk that any deal might undermine the credibility of other rescues and spark calls for renegotiations.

If Greece has to leave the 17-nation eurozone, the effects will make matters worse, probably far worse, for the Greeks, they broadly agree.

For the eurozone and the European Union, the consequences could be severe in terms of renewed tensions in other weak eurozone countries and turmoil as markets adjust, but overall the currency zone could absorb the shock.

However, if the turmoil forced a big eurozone country to seek a rescue, there are doubts about how the EU and IMF bailout funds would cope.

Edgeworth said that with the exception of the ECB, neither the EU nor the IMF had sufficient firewalls in place to deal with any request from Spain for a rescue.

The political effects of Greece leaving the eurozone, and the failure of attempts to keep it solvent, would be highly damaging for the political credibility of the EU, although analysts also say that such a crisis would increase cohesion among the remaining members.

At Capital Economics in London, economist Ben May said that the risks of Greece leaving the eurozone by the end of the year had risen.

Another election and more uncertainty could leave the government without funds to pay immediate bills but default could be avoided if a new election gave the two traditional parties New Democracy and PASOK enough votes to pursue reforms and obtain the next slices of rescue money.

Otherwise, eurozone policy makers might decide to force Greece out of the eurozone.

But Capital Economics also warned that new tensions over Greece could hit the high quality of German debt bonds if investors moved out of the eurozone or because of the costs to Germany of preventing a disorderly break-up of the currency bloc.

Analysts at Commerzbank said: “The horror scenario of Greece leaving the single currency might fuel capital flight from other countries of the periphery — which would force the European Central Bank to provide these countries with capital by printing money at an even greater speed.”

A few observers have wondered if an acute eurozone crisis might lead stronger countries to weigh the advantages of breaking away.

However, the head of the rating agency Fitch, Paul Taylor, told the German Spiegel magazine: “If the deutschemark were reintroduced, it would appreciate considerably against other currencies. Export industries, which are the motor of the German economy, would suffer.”

He concluded: “Germany isn’t going to tolerate that, even if one or more countries leave the eurozone.”

For brokers Oddo in Paris, Bruno Cavalier said that the Greek question was extremely simple: either Greece agreed to lose its remaining sovereignty and apply reforms required by creditors, or it took back its monetary sovereignty and cut its bridges with Europe.

He cited work on the process of accepting fatal disease, by psychologist Elisabeth Kubler-Ross, to the effect that there were four stages from denial, to anger, negotiation and acceptance.

Greece was going through the same process and had to accept a structural inability to live beyond its means on foreign debt, he said.

So far, analysts are not giving much attention to what would happen if there is no compromise over the rescue programme, if Greece does leave the eurozone, but stays in the 27-member EU and needs even more help.

Mrs Clinton said Pakistan’s government needed to ensure that its territory was not used for launching attacks anywhere, including inside Pakistan.

Addressing reporters with Indian Foreign Minister SM Krishna, she added that India was critical in efforts to prevent Iran acquiring nuclear weapons.

She was at the end of an Asian tour.

Talks between Mrs Clinton and Indian officials ranged from India’s imports of Iranian oil to foreign investment.

‘Scourge’

But on Tuesday Mrs Clinton stressed that Pakistan should do more to crack down on violent extremism.

“Terrorists in Pakistan have killed more than 30,000 Pakistanis. We need stronger, more concerted efforts against the scourge of terrorism,” she said.

The comments come just one day after she said Pakistan should act against Hafiz Saeed, founder of Lashkar-e-Taiba, the group blamed for the 2008 Mumbai attacks.

Ten gunmen killed 165 people in a three-day rampage that targeted luxury hotels, a train station and a Jewish centre in India’s commercial capital. Only one gunman, Mohammad Ajmal Amir Qasab, was captured alive.

After initial denials, Pakistan acknowledged that the assault had been partially planned on its territory and that Qasab was a Pakistani citizen. He is appealing against a death sentence in India.

Mrs Clinton also said the US looked to India as a partner in the international effort to prevent Iran from acquiring nuclear weapons.

The US has been putting pressure on nations to stop importing Iranian oil, an important source of revenue for Tehran.

“We commend India for the steps steps it is taking to reduce imports [of oil] from Iran. We are working with India on alternative sources of supply.”

She said US will be sending an energy envoy to India next week for discussions with Indian officials on alternative sources of fuel.

Indian Foreign Minister SM Krishna said Iran was “an important source of oil for us” given India’s growing energy needs.

But, he said, India also had “a strong interest in peaceful and negotiated settlement of issues relating to Iran’s nuclear programme”.

Mrs Clinton’s visit to India is the final stop on a three-nation tour which also took her to China and Bangladesh. BBC News

The ninth-seeded Williams fired 13 aces and 40 winners during her opening match against Vesnina. Williams broke her Russian opponent four times during the first match at the Madrid tournament that is being played on the blue-clay court.

The ninth-ranked American will play Russia’s Anastasia Pavlyuchenkova in the second round.

Williams’ older sister Venus was to take on Angelique Kerber of Germany later Monday. Defending champion Petra Kvitova of the Czech Republic was to play Marina Erakovic of New Zealand. Austin American Statesman