US ‘must suspend’ Iraq withdrawal

US ‘must suspend’ Iraq withdrawal
Petraeus said Iraq was “exceedingly complex and challenging”
Petraeus statement

The top US military leader in Iraq, Gen David Petraeus, has recommended a suspension of troop withdrawals after July to protect gains in Iraq.

Gen Petraeus praised “significant” but “uneven” improvements in security and said troop levels would need a period of evaluation over the summer.

He also said the recent Iraqi operation in Basra was “not adequately planned”.

He and Ambassador Ryan Crocker gave an update to Congress on the Iraq “surge”, on the first of two days of hearings.

They also came face to face with the three senators vying to succeed George W Bush as president this November.

John McCain, the Republicans’ choice as candidate, was positive about the situation in Iraq while Barack Obama and Hillary Clinton, the rivals for the Democratic candidacy, pressed for withdrawal.

‘Evaluation period’

Gen Petraeus and Mr Crocker began on Tuesday by testifying before the Senate Armed Services Committee, then moved on to the Senate Foreign Relations Committee.

Our allies, Arab countries, the UN and the Iraqis themselves will not step up to their responsibilities if we recklessly retreat
Senator John McCain

Gen Petraeus said security was better than the situation at the time of his last report to Congress in September and significantly better than before the start of the US troop surge at the beginning of last year.

But while there had been real progress, it was “fragile and is reversible”, he said.

The planned “drawdown” of about 20,000 troops should continue to July but afterwards there should be a 45-day “period of consolidation and evaluation”, he said.

He could not say how many US troops would be in Iraq at the end of the year. The US currently has 160,000 troops in Iraq.

Mr McCain said he believed there was a genuine chance of success in Iraq and that a withdrawal could result in a failure that might require the US to return later for a far more costly war.

“Our allies, Arab countries, the UN and the Iraqis themselves will not step up to their responsibilities if we recklessly retreat,” he said.

When he asked Gen Petraeus about the recent Iraqi-led operation against militias in Basra, the US commander said it had not been “adequately planned or prepared”.

Iraq sent thousands of troops to Basra in a failed attempt to force the Shia Mehdi Army militia into submission. Hundreds died in heavy fighting.

‘Massive blunder’

Ambassador Crocker said progress in Iraq had been “uneven and often frustratingly slow” but the US and Iraq were negotiating a long-term agreement on their relations that would cover the US troop presence.

He insisted the deal did not envisage permanent US bases in Iraq and that it would “not tie the hands of the next administration”.

Mrs Clinton, who serves on the armed services committee, condemned the decision not to submit the deal to the US Congress.

She said it was time for the “orderly process of withdrawing troops” as Iraqi leaders had failed to deliver.

The Iraq deployment, she argued, was stretching the military’s resources while the Bush administration was ignoring the costs being incurred by continuing a failed policy.

Gen Petraeus accused Iran of funding and training Shia militias through cells the US terms “special groups”.

Speaking as a member of the foreign relations committee, Mr Obama said the US “should be talking to Iran [as it could] not stabilise the situation without them”.

He repeated his view that the US invasion had been a “massive strategic blunder” and called for a timetable for withdrawal.

Story from BBC NEWS:
http://news.bbc.co.uk/go/pr/fr/-/2/hi/middle_east/7336731.stm

Published: 2008/04/08 23:30:49 GMT

U.S. Death Toll in Iraq War Hits 4,000

U.S. Death Toll in Iraq War Hits 4,000

By the time Specialist Jerry Ryen King decided to write about his experiences in Iraq, the teen-age paratrooper had more to share than most other soldiers.

In two operations to clear the outskirts of the village of Turki in the deadly Diyala Province, Specialist King and the rest of the Fifth Squadron faced days of firefights, grenade attacks and land mines. Well-trained insurgents had burrowed deep into muddy canals, a throwback to the trenches of World War I. As the fighting wore on, B-1 bombers and F-16s were called in to drop a series of powerful bombs.

Once the area was clear of insurgents, the squadron, part of the 82nd Airborne Division, uncovered hidden caches with thousands of weapons.

Two months later, Specialist King, a handsome former honors student and double-sport athlete from Georgia, sat down at his computer. In informal but powerful prose, he began a journal.

After 232 long, desolate, morose, but somewhat days of tranquility into deployment, I’ve decided that I should start writing some of the things I experienced here in Iraq. I have to say that the events that I have encountered here have changed my outlook on life…

The most recent mission started out as a 24-36 hour air-assault sniper mission in a known al-Qaida stronghold just north of Baghdad. We landed a few hours before daybreak and as soon as I got off the helicopter my night vision broke, I was surrounded by the sound of artillery rounds, people screaming in Arabic, automatic weapons, and the terrain didn’t look anything like what we were briefed. I knew it was going to be a bad day and a half.

Jerry Ryen King, journal entry, March 7, 2007

A month later, Specialist King was sitting inside his combat outpost, an abandoned school in Sadah, when suicide bombers exploded two dump trucks just outside the building. The school collapsed, killing Specialist King on April 23, 2007, along with eight other soldiers, and making the blast one of the most lethal for Americans fighting in Iraq.

In that instant, Specialist King became one of 4,000 service members and Defense Department civilians to die in the Iraq war — a milestone that was reached late Sunday, five years since the war began in March 2003. The last four members of that group, like the majority of the most recent 1,000 to die, were killed by an improvised explosive device. They died at 10 p.m. Sunday on a patrol in Baghdad, military officials said; their names have not yet been released.

The next day we cleared an area that made me feel as if I were in Vietnam. Honestly, it was one of the scariest times of my life. At one point I was in water up to my waist and heard an AK fire in my direction. But all in all the day was going pretty good, no one was hurt, I got to shoot a few rounds, toss a grenade, and we were walking to where the helicopter was supposed to pick us up.

Jerry Ryen King, journal entry, March 7, 2007

The year 2007 would prove to be especially hard on American service members; more of them died last year than in any other since the war began. Many of those deaths came in the midst of the 30,000-troop buildup known as “the surge,” the linchpin of President Bush’s strategy to tamp down widespread violence between Islamic Sunnis and Shiites, much of it in the country’s capital, Baghdad. In April, May and June alone, 331 American service members died, making it the deadliest three-month period since the war began.

But by fall, the strategy, bolstered by new alliances with Sunni tribal chiefs and a decision by the Shiite cleric Moktada al-Sadr to order his militia to stop fighting, appeared to be paying off as the country entered a period of relative calm. Military casualties and Iraqi civilian deaths fell, and the October-December period produced the fewest casualties of any three months of the war. The past month, though, has seen an uptick in killings and explosions, particularly suicide bombings. Much of the violence has traveled north to Mosul, where the group calling itself Al Qaeda in Mesopotamia remains strong.

Everything changed in a matter of 15 minutes… About the time I was opening my MRE (meal ready to eat) I heard an explosion. Everyone started running towards the sound of the explosion. Apparently a suicide bomber had blown himself up killing four soldiers from my squadron and injuring another. Our 36 hour mission turned into another air- assault into a totally different city, the clearing of it, and 5 more days. We did find over 100 RPG’s, IED making materials, insurgents implacing IED’s, artillery rounds, a sniper rifle, and sort of like a terrorist training book and cd’s.

Jerry Ryen King, journal entry, March 7, 2007

Unlike the soldiers of some previous wars, who were only occasionally able to send letters back home to loved ones, many of those who died left behind an extraordinary electronic testimony describing in detail the labor, the fears and the banality of serving in Iraq.

In excerpts published here from journals, blogs and e-mail messages, six soldiers who died in the most recent group of 1,000 mostly skim the alarming particulars of combat, a kindness shown their relatives and close friends. Instead, they plunge readily into the mundane, but no less important rhythms of home. They fire off comments about holiday celebrations, impending weddings, credit card bills, school antics and the creeping anxiety of family members who are coping with one deployment too many.

At other moments, the service members describe the humor of daily life down range, as they call it. Hurriedly, with little time to worry about spelling or grammar, they riff on the chaos around them and reveal moments of fear. As casualties climb and the violence intensifies, so does their urge to share their grief and foreboding.

A Last Goodbye

Hey beautiful well we were on blackout again, we lost yet some more soldiers. I cant wait to get out of this place and return to you where i belong. I dont know how much more of this place i can take. i try to be hard and brave for my guys but i dont know how long i can keep that up you know. its like everytime we go out, any little bump or sounds freaks me out. maybe im jus stressin is all. hopefully ill get over it….

you know, you never think that anything is or can happen to you, at first you feel invincible, but then little by little things start to wear on you…

well im sure well be able to save a couple of bucks if you stay with your mom….and at the same time you can help her with some of the bills for the time being. it doesnt bother me. as long as you guys are content is all that matters. I love and miss you guys like crazy. I know i miss both of you too. at times id like to even just spend 1 minute out of this nightmare just to hold and kiss you guys to make it seem a little bit easier. im sure he will like whatever you get him for xmas, and i know that as he gets older he’ll understand how things work. well things here always seem to be……uhm whats the word…..interesting i guess you can say. you never know whats gonna happen and thats the worst part. do me a favor though, when you go to my sisters or moms or wherever you see my family let them know that i love them very much..ok? well i better get going, i have a lot of stuff to do. but hopefully ill get to hear from you pretty soon.*muah* and hugs. tell mijo im proud of him too!

love always,
your other half
Juan Campos, e-mail message to his wife, Dec. 12, 2006.

When Staff Sgt. Juan Campos, 27, flew from Baghdad to Texas for two weeks last year, there was more on his mind than rest and relaxation. He visited his father’s grave, which he had never seen. He spent time with his grandparents and touched base with the rest of his rambling, extended family.

The day he was scheduled to return to war, Sergeant Campos and his wife went out dancing and drinking all evening with friends. Calm and reserved by nature, Sergeant Campos could out-salsa and out-hip-hop most anyone on the dance floor. At the airport, his wife, Jamie Campos, who had grown used to the upheaval of deployment, surprised herself.

“I cried and I have never ever cried before,” said Mrs. Campos, 26, who has a 9-year-old son, Andre. “It was just really, really weird. He knew, and I kind of knew. It felt different.”

“We both felt that it was the last goodbye,” she said.

Tuesday, Oct. 3, 2006
Mood: gloomy
The life of an infantryman is never safe..how do I know, well I live it every day.

I lost a good friend of mine just two days ago to an enemy sniper. The worst feeling in the world is having lost one of your own and not being able to fight back. The more I go on patrol, the more alert I tend to be, but regardless of the situation here in Iraq is that we are never safe. No matter the countermeasures we take to prevent any attacks. They seem to seep through the cracks. Every day a soldier is lost or wounded by enemy attacks. I for one would like to make it home to my family one day. Pray for us and keep us in your thoughts…for an infantryman’s life is never safe.

Juan Campos, Myspace blog

Sergeant Campos, a member of the First Battalion, 26th Infantry, Charlie Company out of Germany, was one of thousands of infantrymen assigned to stabilize Baghdad and the surrounding areas last year during the troop buildup. Troops were sent deep into insurgent neighborhoods, where they lived in small outposts, patrolled on foot, cleared houses, mingled with Iraqis and rebuilt the infrastructure.

The extra 30,000 service members — 160,000 in all — were deployed to Iraq to help quell the runaway violence that threatened large-scale civil war. Most soldiers spent 15 months in Iraq, a length of time that military commanders have said is unsustainable. Many had fought in the war at least once. A few had been in Iraq multiple times.

My only goals are to make it out of this place alive and return you guys and make you as happy as I can.

Juan Campos, e-mail message to his wife, Dec. 15, 2006.

But to Sergeant Campos and the rest of Charlie Company in Adhamiya, a north Baghdad stronghold for Sunni insurgents, the buildup seemed oddly invisible. The men patrolled almost every day, sometimes 16 to 18 hours a day for months, often in 120-degree weather. Exhaustion was too kind a word for their fatigue.

More than 150 soldiers lived in a two-story house with portable toilets, no air-conditioning and temperamental showers. Sleep came only a few hours at a time. The fighting was vicious. Adhamiya was such a magnet for sectarian bloodletting that the military built a wall around it to contain the violence.

“They walled us in and left us there,” Staff Sgt. Robin Johnson, 28, said of the 110 men in Charlie Company. “We were a family. I would die for these guys before I die for my own blood brother.”

On patrol, sniper fire rang out so routinely that soldiers in Sergeant Campos’s platoon seldom stood still for more than four seconds. They scoured rooftops for Iraqi children who lobbed grenades at American soldiers for a handful of cash. Roadside bombs burst from inside drainage pipes, impossible to detect from the street. The bombs grew larger by the month.

Last year, these powerful improvised explosive devices, known as I.E.D.s were responsible for a majority of American fatalities, a new milestone. The bombs also killed multiple soldiers more often than in the past, a testament to their potency.

“It was the most horrible thing you could possibly imagine,” Sergeant Johnson said. “As soon as you left the gate, you could die at any second. If you went out for a day and you weren’t attacked, it was confusing.”

Charlie Company soldiers found a steady stream of Iraqis killed by insurgents for money or revenge. Some had their faces wiped clean by acid. Others were missing their heads or limbs.

‘It Could Have Been Me’

to tell the story of iraq is a hard one.

Ryan Wood, Myspace blog.

Sgt. Ryan M. Wood, 22, a gifted artist, prolific writer and a sly romantic from Oklahoma, was also one of the bluntest soldiers inside Charlie Company.

it is fighting extreme boredom with the lingering thought in the forefront of your mind that any minute on this patrol could be my last endeavour, only highlighted by times of such extreme terror and an adrenaline rush that no drug can touch. what [expletive] circumstances thinking “that should’ve been me” or “it could’ve been me”. wondering it that pile of trash will suddenly explode killing you or worse one of your beloved comrads..only backed by the past thoughts and experiences of really losing friends of yours and not feeling completely hopeless that it was all for nothing because all in all, you know the final outcome of this war. it is walking on that thin line between sanity and insanity. that feeling of total abandonment by a government and a country you used to love because politics are fighting this war……and its a losing battle….and we’re the ones ultimently paying the price.

Ryan Wood, Myspace blog, Adhamiya

For the soldiers in Iraq, reconciling Adhamiya with America was not always easy. One place was buried in garbage and gore and hopelessness. The other seemed unmoored from the war, fixated on the minutia of daily life and the hiccups of the famous. The media was content to indulge.

WHAT THE HELL AMERICA??

“What the hell happened?” any intelligent American might ask themselves throughout their day. While the ignorant, dragging themselves to thier closed off cubicle, contemplate the simple things in life such as “fast food tonight?” or “I wonder what motivated Brittany Spears to shave her unsightly, mishaped domepiece?”

To the simpleton, this news might appear “devastating.” I assume not everyone thinks this way, but from my little corner of the earth, Iraq, a spot in the world a majority of Americans could’nt point out on the map, it certainly appears so. This little piece of truly, heart-breaking news captured headlines and apparently American imaginations as FOX news did a two hour, truly enlightening piece of breaking news history. American veiwers watched intently, and impatiently as the pretty colors flashed and the media exposed the inner workings of Brittany’s obviously, deep character. I was amazed, truly dumbfounded wondering how we as Americans have sank so low. To all Americans I have but one phrase that helps me throughout my day of constant dangers and ever present death around the corner, “WHO THE [expletive] CARES!” Wow America, we have truly become a nation of self-absorbed retards. … This world has serious problems and it’s time for America to start addressing them.

Ryan Wood, Myspace blog, May 26, 2007

The somberness of the job was hard to shake off. But, day to day, there was no more reliable antidote than Pfc. Daniel J. Agami, a South Floridian with biceps the size of cantaloupes, and Pfc. Ryan J. Hill, a self-described hellion who loved his “momma” and hailed from what he called the “felony flats” of Oregon. Funny men in the best sense of the word, the two provided a valuable and essential commodity in a war zone.

Their mother jokes — the kind that begin, “your mother is so…” — were legendary, culminating in a Myspace joke-off. It ended abruptly after an enough-is-enough phone call from Private Hill’s mother, who ranked No. 1 on his list of heroes in Myspace. Private Agami proclaimed victory.

About a month later…I went to my room and my mattress was missing and all my close were being worn by other people. I couldn’t figure it out so I knew right off the bat to go to Hill. I saw him walking down the hall wearing five of my winter jackets. He sold half my wardrobe right off his back to people in our company and my mattress was in someone else’s room. So then I had go to around and buy all my stuff back. (Now I think he won).

Daniel J. Agami, Charlie Company. Eulogy sent via e-mail message to his mother, Jan. 29, 2007

To keep their spirits up, combat soldiers learned to appreciate the incongruities of war in Iraq. Jokes scrawled inside a Port-o-Potty quickly made the rounds. Situational humor, from goofy to macabre, proved plentiful.

A really girly guy who was a cheerleader in high school, got knocked down and nearly hurt by the wind of the helicopter. Listening to Dickson recite what was in every single MRE was pretty funny. A cow charged and nearly trampled one of my friends when we were raiding a compound. And lastly, I thought that it was pretty comical that I shot at a guy a long ways out but missed and later after taking his house and using it as a patrol base he offered me Chai and rice.

Jerry Ryen King, Diyala Province

Even a trip to the dentist, with its fringe benefits, is cause for amusement in a war zone.

Last Sat. I had two of my wisdom teeth pulled. After taking double the prescribe percocot and morphine pills that the doctor gave me for the pain I decided to catch a flight back to my FOB (forward operation base). It was the coolest Blackhawk ride I’ve had, I was absolutely ripped and I talked the pilots into leaving the doors open. We had four more guys die a couple days ago. They hit an IED, it killed everyone in the humvee.. It’s starting to get a little scary. We made it our first six months with just two deaths and that was plenty. But now just in the past two and a half weeks we’ve had nine more guys get killed, and over 50 wounded. I’m just hoping that I can make it the 75 more days or so that we have left of combat operations before we start packing.

Jerry Ryen King, journal entry, April 11, 2007

Among the guys in Charlie Company, Private Agami, 25, was one of the boldest and most resilient. He was the kind of guy who joined an endurance ski contest on a whim. He came in fourth. He had never skied in his life.

Private Agami had time for everyone, and everyone had time for him. Affectionately called GI Jew, he held his religion up to the light. He used it to build tolerance among the troops and shatter stereotypes; few in his unit had ever met a Jew. He flew the Israeli flag over his cot in Adhamiya. He painted the words Hebrew Hammer onto his rifle. He even managed to keep kosher, a feat that required a steady diet of protein shakes and cereal.

Commander Mom, I cant wait to come home and when I do, dont worry ill have allot to say to the congregation. Dont worry about my mental stage either, we all receive counseling and help from doctors when something like this happens. I am a strong individual physically and mentally and if there is one thing the army teaches you, it is how to deal with death. Everyday that passes it gets easier and easier. I miss you guys very much and I love you!

Daniel Agami, e-mail message to his mother, Oct. 28, 2006

It did not get easier.

I try not to cry. I have never cried this much my entire life. two great men got taken from us way too soon. i wonder why it was them in not me. I sit here right now wondering why did they go to the gates of heaven n not me. I try everynight count my blessing that I made it another day but why are we in this hell over here? why? i cant stop askin why?

Ryan Hill, Myspace blog, Nov. 1, 2006

Private Hill was riding in a Humvee on Jan. 20, 2007 when an I.E.D. buried in the middle of the road detonated under his seat, killing him instantly.

Sergeant Campos was riding in a Humvee on May 14, 2007, two weeks after returning from Texas, when it hit an I.E.D. The bomb lifted the Humvee five feet off the ground and engulfed it in flames. “That’s when we just left hope at the door,” Sergeant. Johnson said. Severely burned over 80 percent of his body, Sergeant Campos lived two weeks. He died June 1. Another soldier, Pfc. Nicholas S. Hartge, 20, of Indiana, died in the same attack.

Private Agami was driving a Bradley fighting vehicle on June 21, 2007 when it hit an I.E.D. The explosion flipped the 30-ton vehicle, which also carried Sergeant Wood. Both men were killed, along with three other soldiers and an Iraqi interpreter.

“Obviously, it came to a point, you didn’t care anymore if it got better,” said Staff Sgt. Jeremy S. Rausch, 31, one of Sergeant Campos’s best friends in Charlie Company. “You didn’t care about the people because they didn’t care about themselves. We had already lost enough people that we just thought, you know, ‘why?’ ”

During their time in Adhamiya, the soldiers of Charlie Company caught more than two dozen high-value targets, found nearly 50 weapons caches, detained innumerable insurgents and won countless combat awards. They lost 14 men. Their mission was hailed a success.

Just in Case

Texan to the core, enamored of the military, Specialist Daniel E. Gomez, 21, an Army combat medic in the division’s Alpha Company, relied on his books, his iPod and an Xbox to distract him from the swirl.

strange but this place where we are at is unreal almost. I hope I come back mentally in shape. lol.

Daniel Gomez, Myspace blog, Sept. 9, 2006

He took pride in being the guy who tended to wounded soldiers under fire, patching them up to help them survive. He did not hesitate to do the same for Iraqis.

this iraqi national who I have to say was extremely lucky that he escaped with only sharpnel wounds (metal fragments that fly away from a bomb) when he was standin near a car bomb that was aimed at Iraqi police patrol. Turns out it blow up just when we were passin by soo we had to stop and help. He really was not that lucky though…He had sharpnel to the ankle (it was also broken), to the calf and in the stomach. And he lost his 2 sons in the blast. this [expletive] happens everyday here. [Expletive] insurgents. Anyhow there are more pictures.

Daniel Gomez, e-mail message to friends and family, Sept. 15, 2006

As the violence intensified, Specialist Gomez set aside thoughts of a free Iraq or a safer America and, like generations of soldiers before him, simply started fighting for the soldier next to him.

A few days ago I realized why I am here in Baghdad dealing with all the gunfire, the rocket attacks, the IEDs, the car bombs, the death. I have only been here going on a month and a half. Already I have seen what war really is… but officially its called “full spectrum operations.” No I don’t down Bush, he is my CinC, and I think he is doing an good job with what Clinton left him. I don’t debate why we are involved in Iraq. I just know why I am here. It is not for the smiling Iraqi kids, or the even the feeling of wearing the uniform ( it feels damn good though 🙂 . I am here for the soldier on patrol with me.

But why are you there in the states. Why are you having that nice dinner, watching TV, going out on dates…

Daniel Gomez, e-mail to friends and family. Sept. 27, 2006

And then Specialist Gomez fell in love. An e-mail flirtation with Katy Broom, his sister’s close friend, gradually led to a cyber exchange of guarded promises about the future. Headed home for a rest break in May, the tentativeness lifted and they began to rely on each other to get through the day. The two joked about “the best sex we never had.”

…this R&R there is someone new in my life. Exactly what she is too me, and what I am to her is uncertain, but its not really important at the moment. Just the thought that I could spent a second of my life with her, before I have to come back here makes everything worth it.

Daniel Gomez, Myspace blog, May 9, 2007

Rest and relaxation in Georgia went better than expected. He fell in love with the love of his life all over again, this time in person. The couple shared one kiss during his leave.

“He was everything I expected and more,” said Ms. Broom, 20, who spent one week and two days with him. “It was kind of surreal when we met. It’s almost like a perfect love and war story.”

Not many soldiers leave behind a just-in-case letter. Specialist Gomez did. He handed Ms. Broom an envelope at the airport with the words, “Don’t read unless something happens to me.”

On July 18, 2007, two months after his leave, Specialist Gomez died in Adhamiya when the Bradley fighting vehicle he was in struck a roadside bomb. The explosion and flames also killed three other soldiers.

Ms. Broom waited three days after she got word to open the letter. She sat alone in the couple’s favorite spot, her apartment balcony.

“I was very thankful that he wrote it,” she said of the letter. “I have opened and closed it so many times, I’m surprised it hasn’t fallen apart.”

R+R 2007

Hey baby. If you’re reading this, then something has happen to me and I am sorry. I promised you I would come back to you, but I guess it was a promise I could not keep. You know I never believe in writing “death letters.” I knew if I left one for my folks it would scare them. Then I met you. We were supposed to meet, darling. I needed someone to make me smile, someone that was an old romantic like I was. I was going through a very rough time in Iraq and I was startin to doubt my mental state. Then one day after a patrol, I go to my facebook and there you were…

I can’t stop crying while I writing this letter, but I have to talk to you one last time, because maybe the last time I heard your voice I did not know it would be the last time I heard your voice….

I Love You. Go be happy, go raise a family. Teach your kids right from wrong, and have faith, darling. I think I knew I loved you even before I met. I love you, Katy. * Kiss * Goodbye

Stocks, Dollar Surge; Treasuries Drop on Fed Cut, Lehman Report

March 18 (Bloomberg) — U.S. stocks rallied the most in five years, the dollar posted its biggest gain against the yen since 1999 and Treasuries tumbled after the Federal Reserve cut its benchmark interest rate and Lehman Brothers Holdings Inc. said it has more than enough capital to survive.

The Standard & Poor’s 500 Index surged after Lehman and Goldman Sachs Group Inc. reported more profit than analysts estimated. The world’s reserve currency jumped to 99.75 yen at 4:41 p.m. in New York. Two-year Treasury notes declined, pushing their yield higher by the most since 2001, after the Fed lowered its target rate for overnight lending between banks by a smaller- than-expected 0.75 percentage point.

“This is maybe the start of the Fed trying to walk the market back from the brink,” said Joseph Veranth, who helps manage about $2.8 billion as chief investment officer at Dana Investment Advisors in Brookfield, Wisconsin. “All in all, the Fed has to be pleased with the market reaction.”

The central bank is trying to restore confidence in the financial markets by slashing rates at the most aggressive pace in two decades and injecting cash into the banking system. The credit freeze sparked by the subprime-mortgage market’s collapse pushed the S&P 500 to within 0.4 percentage point of a bear market yesterday, sent the dollar to an all-time low against the euro and prompted investors to seek safety in government debt.

The S&P 500 rose 4.2 percent to 1,330.74 today and financial shares in the index jumped the most since 2000 after the earnings at Lehman and Goldman assuaged concern that Wall Street firms were overvalued.

Biggest Gain Ever

Lehman had its steepest advance ever as the company assured investors it will avoid the fate of Bear Stearns Cos., which ran out of cash last week and was forced to sell itself to JPMorgan Chase & Co. for a 93 percent discount.

Lehman, the fourth-biggest U.S. securities firm, climbed 46 percent to $46.49 today. Goldman, the largest, added 16 percent to $175.59.

“People are relieved that Goldman and Lehman weren’t worse,” said Ed Peters, the Boston-based chief investment officer at PanAgora Asset Management, which manages $25 billion. “Right now there don’t appear to be more liquidity problems, so we’re seeing a nice rally.”

The U.S. currency advanced to $1.5628 per euro as the central bank’s rate reduction was smaller than many investors anticipated, boosting the appeal of deposits in the currency. Traders had priced in 86 percent odds that the Fed would cut by 1 percentage point, according to futures trading.

`Less Aggressive’

“The dollar picked up a little on the less aggressive move,” said Shaun Osborne, chief currency strategist at TD Securities in Toronto.

The Fed cut its benchmark rate to 2.25 percent today, the lowest in more than three years. It was the sixth reduction, and follows eight cuts in the discount rate for direct loans to banks since the middle of August, when the collapse of subprime mortgages started to infect markets around the world.

Yields on two-year notes rose 0.26 percentage point to 1.61 percent at 5:31 p.m. in New York, according to bond broker Cantor Fitzgerald LP. It was the biggest increase since December 2001. The benchmark 10-year note’s yield rose 0.18 percentage point, the most since April 2004, to 3.48 percent.

Hezbollah Scolds U.S. for Sending Ships Toward Lebanon

Hezbollah Scolds U.S. for Sending Ships Toward Lebanon

BEIRUT, Lebanon — As American warships moved toward Lebanon on Friday, Hezbollah accused the United States of threatening regional stability, and the country’s pro-Western prime minister took pains to distance himself from the decision.

American officials said Thursday that they were sending the destroyer Cole to the eastern Mediterranean, along with at least two other ships, in a “show of support” as Lebanon entered its fourth month without a president. But the move, after American officials have repeatedly blamed neighboring Syria for Lebanon’s political impasse, seemed to be a calculated show of force, one with ominous historical echoes for Lebanese of various viewpoints.

“We are facing an American threat against Lebanon,” said Hassan Fadlallah, a member of Hezbollah’s parliamentary bloc, on local television.

Prime Minister Fouad Siniora, who has often been accused by Hezbollah and its allies in the Lebanese opposition of being an American pawn, said, “We did not request warships from any side.” Speaking to Arab diplomats at the government headquarters, he added that the American ships were not in Lebanese territorial waters.

Asked whether the United States had coordinated the action with the Lebanese government, Gordon D. Johndroe, a White House spokesman, said, “We have regular consultations with Prime Minister Siniora and his government.”

He said the purpose of the ships was “a show of support for regional stability.” As to Hezbollah’s concerns, he said, “I would express some of our own concerns with Hezbollah’s actions.”

The parliamentary majority, led by Mr. Siniora, has been locked in a bitter power struggle with the opposition for 15 months, and the government — with no president and a skeleton cabinet — has been crippled. But the arrival of the American warships underscored the broader meaning of the crisis, as a proxy confrontation between Hezbollah’s patrons — Iran and Syria — and the Western and Arab coalition supporting the majority, led by the United States.

Tensions have risen in recent weeks since the death of Imad Mugniyah, a top Hezbollah commander, in a car bombing in Damascus, Syria’s capital. At his funeral, Hassan Nasrallah, Hezbollah’s leader, accused Israel of the bombing and threatened to expand his group’s conflict with the Jewish state by retaliating against Israeli targets anywhere in the world. Israel has denied involvement in the killing, and no one has claimed responsibility.

More recently, Saudi Arabia, Kuwait, and Bahrain — all Sunni Arab nations that see Iran, a Shiite nation, as a major regional threat — warned their citizens not to travel to Lebanon. The confrontation over Lebanon has threatened to scuttle an Arab summit meeting, scheduled for late March, with Saudi Arabia and other Arab states accusing Syria of prolonging the Lebanese political crisis.

In this volatile context, the arrival of the American warships is widely seen as a provocation. “It came without preliminaries or any prior signals,” wrote the pro-government daily newspaper An Nahar, “and has been wrapped in an envelope of justifications that were not to the liking even of pro-government circles.”

Others were more direct. “America repeats the adventure of ’82,” was the banner headline on Friday of Al Akhbar, a pro-opposition daily.

American warships deployed to Lebanon in 1982, during the 15-year civil war. That venture resulted in tragedy when suicide bombers struck a Marine barracks and the United States Embassy in Beirut, killing hundreds of Americans and effectively driving the United States out of Lebanon. The attacks are believed to have been organized by Mr. Mugniyah, the Hezbollah official killed two weeks ago.

The destroyer on its way toward Lebanon, the Cole, also echoes the past. Suicide bombers linked to Al Qaeda struck the ship as it was refueling in the Yemeni port of Aden in October 2000, killing 17 American sailors.

Ban Worried About Hizbullah Rearming, Holds Syria, Iran Responsible

U.N. Secretary-General Ban Ki-moon expressed concern over the rearming of Hizbullah and held both Syria and Iran responsible for breaches of the arms embargo.
“Reports of Hizbullah rearming are a cause of great concern, posing serious challenges to the sovereignty, stability and independence of Lebanon and the implementation of resolution 1701 (2006),” Ban saidi in his 6th report on the implementation 1701.

“I remain concerned about ongoing reports and Hizbullah public statements that point to breaches of the arms embargo, in serious violation of resolution 1701,” he said.

“All Member States in the region, in particular the Syrian Arab Republic and the Islamic Republic of Iran, have a key responsibility in this regard,” Ban added.

“Such violations risk further destabilizing Lebanon and the whole region,” he said.

“In my last report to the Council on the implementation of resolution 1701 … I drew attention to alleged breaches of the arms embargo across the border between Lebanon and the Syrian Arab Republic and the claimed transfer of sophisticated weaponry from the Islamic Republic of Iran and the Syrian Arab Republic across this border,” Ban said.

“In its letter dated 10 December 2007 Syria counters these claims and maintains that allegations of weapons smuggling across the Syrian-Lebanese border are motivated by political rather than security considerations.

“However, Hizbullah, by admission of its leaders on several occasions has replenished its military capacity after the 2006 war with Israel.

“I, therefore, remain concerned that this border remains vulnerable to such breaches, which would represent serious violations of the resolution and constitute a significant threat to the stability and security of Lebanon.