The Prime Minister told a meeting of the 1922 Committee that he was winning support for Britain's position with other European leaders, following phone calls with Swedish premier Fredrik Reinfeldt and Irish prime minister Enda Kenny. Meanwhile, the euro continued to slide as France tried to play down the impact of the likely loss of its AAA credit rating, which it has held since 1975. Ratings agency Standard & Poor's warned that 15 eurozone countries faced a downgrade ahead of last week's crunch talks.

Of the six AAA-rated nations, FRANCE WAS SINGLED OUT FOR A TWO-NOTCH DOWNGRADE. Analysts warned that such a move could shatter confidence, push up interest rates for the government, households and businesses, and tip the economy back into recession. One said it would be 'THE START OF REAL NIGHTMARE' FOR FRANCE. Mr Sarkozy has previously made keeping hold of the top-notch rating a point of pride, amid warnings that its loss could spell disaster for him in next year's elections.

German Chancellor Angela Merkel struck a different tone to Mr Sarkozy yesterday, saying it was 'beyond any doubt that Britain would remain a very secure partner' in the EU. A Downing Street source said Mr Cameron would not be responding to Mr Sarkozy's outburst, and preferred to maintain a 'dignified silence'. The Conservative leader in Brussels, Martin Callanan, dismissed the 'childish insults and sinister threats' against Britain, adding: 'Angela Merkel seemed to extend an olive branch to the UK in her speech and we will happily take it.'

If this is remotely true, the calibrated soft-landing intended by Chinese authorities has gone badly wrong and risks spinning out of control. The growth of the M2 money supply slumped to 12.7% in November, the lowest in 10 years. New lending fell 5% on a month-to-month basis. The central bank has begun to reverse its tightening policy as inflation subsides, cutting the reserve requirement for lenders for the first time since 2008 to ease liquidity strains.

The question is whether the People's Bank can do any better than the US Federal Reserve or Bank of Japan at deflating a credit bubble. Chinese stocks are flashing warning signs. The Shanghai index has fallen 30% since May. It is off 60% from its peak in 2008, ALMOST AS MUCH IN REAL TERMS AS WALL STREET FROM 1929 TO 1933. "Investors are massively underestimating the risk of a hard-landing in China, and indeed other BRICS (Brazil, Russia, India, China)... a 'Bloody Ridiculous Investment Concept' in my view," said Albert Edwards at Societe Generale

"The BRICs are falling like bricks and the crises are home-blown, caused by their own boom-bust credit cycles. Industrial production is already falling in India, and Brazil will soon follow. There is so much spare capacity that they will start dumping goods, risking a deflation shock for the rest of the world. It no surprise that China has just imposed tariffs on imports of GM cars. I think it is highly likely that China will devalue the yuan next year, RISKING A TRADE WAR," he said.

Wolfgang Schauble told the journalists that it had been his idea to stop the flow of aid to Athens. That move had helped convince Athens to drop its controversial plans for a referendum on new austerity steps, calming financial markets. Schauble had personally delivered the news in a phone call to his Greek counterpart Evangelos Venizelos, in hospital at the time with stomach pains. "Yes, indeed it was the finance minister who stopped the payment," a somewhat startled Merkel acknowledged. "He was the one who reacted first."

Reporters glanced at each other in surprise. Here was Europe's most powerful leader being called out in public by one of her ministers. Instead of rebuking Schauble, Merkel had deferred to him, admitting he was right. The unusual exchange in early November gives a glimpse into the complex relationship between Merkel and Schauble. Once his deputy, Merkel is now Schauble's boss. Their bond has survived two decades of slights and reversals - and it is now central to the euro-zone debt crisis.

Schauble, a 69-year old political veteran, has been confined to a wheelchair since being shot by a deranged man a week after German reunification. Long committed to the cause of European unity, he has heavily influenced Berlin's response to the crisis.

"WHEN THINGS GET REALLY DIFFICULT ... SUDDENLY SOLUTIONS WHICH SEEMED IMPOSSIBLE BECOME POSSIBLE," Schauble said. "Because of this, the crisis represents an opportunity. I'm not saying that I enjoy being in a crisis, but I'm not worried. EUROPE ALWAYS MOVED FORWARD IN TIMES OF CRISIS. SOMETIMES YOU NEED A LITTLE PRESSURE FOR CERTAIN DECISIONS TO BE TAKEN."

"The US withdrawal from Iraq will no doubt create a power vacuum," said Abdulaziz Sager, chairman of the Gulf Research Centre, noting that the US presence in the region empowered Gulf Arab countries with "whom they share interests and are bound by security agreements. This (US) presence gave them (Gulf countries) a sense of stability and security due to America's military capabilities," said Sager, adding that the troop withdrawal will "strengthen Iran's military and intelligence influence," in Iraq.

After nine years in Iraq, the US will withdraw its last remaining troops by the end of 2011, a year that so far has seen unprecedented uprisings in the Arab world that have unseated three entrenched dictators in Tunisia, Egypt and Libya, but also fuelled the sectarian and religious divide in the region. Gulf Arab countries are primarily concerned about what Iran might do in what is today a Shiite-led Iraq, as well as their intentions in the broader region, including Saudi Arabia and Bahrain where Sunni regimes have harshly quelled Shiite dissent in recent months.

According to Sager, Iran's increased clout may not pose a "direct threat to Iraq" but will rather be used by the Shiite nation to challenge its rivals in the primarily Sunni Gulf, and to compensate for the potential loss of its ally Syria which is experiencing a mass uprising. Iraq shares a religious link with Iran, and both nations have expressed similar critical views of the mounting regional and international pressure on Syrian President Bashar al-Assad to resign.

Political analyst Sami al-Nisf, meanwhile, said the timing of the American withdrawal from Iraq was unfortunate and will only complicate the region's existing political and sectarian challenges. "The Americans should have stayed (in Iraq) as they did in Germany and Japan so the country does not become totally under Tehran's control," Nisf said, adding that "unfortunately, we are moving in that direction."

President Barack Obama, who came to office pledging to bring troops home, said the US left behind a "sovereign, stable and self-reliant Iraq". Some 4,500 US soldiers and more than 100,000 Iraqis have died in the war. It has cost the US some $1 trillion. Republicans have criticised the pullout citing concerns over Iraq's stability, but most Americans support the move. In a speech to troops just returned from Iraq in North Carolina on Wednesday, Mr Obama hailed the "extraordinary achievement" of the military and said they were leaving with "heads held high".

"Everything that American troops have done in Iraq, all the fighting and dying, bleeding and building, training and partnering, has led us to this moment of success," he said. "The war in Iraq will soon belong to history, and your service belongs to the ages." He said the war had been "a source of great controversy" but that they had helped to build "a sovereign, stable and self-reliant Iraq, with a representative government that was elected by its people". Some 1.5 million Americans have served in Iraq since the US invasion in 2003. In addition to those who died, nearly 30,000 have been wounded.

In the city of Falluja, a former insurgent stronghold which was the scene of major US offensives in 2004, people burned US flags on Wednesday in celebration at the withdrawal. "No-one trusted their promises, but they said when they came to Iraq they would bring security, stability and would build our country," Ahmed Aied, a grocer, told Reuters news agency. "Now they are walking out, leaving behind killings, ruin and mess."

Concerns have also been voiced in Washington that Iraq lacks robust political structures or an ability to defend its borders. There are also fears that Iraq could be plunged back into sectarian bloodletting, or be unduly influenced by Iran.

I've just completed a two-week speaking tour of Australia, hosted by the Q Society, an Australian human rights group. While there, I heard the Q Society's Vickie Jansen report on the situation on the ground in Australia: "La Trobe University has its Muslim-only toilets and prayer rooms. The group Aussie Muslims is campaigning for exclusively Muslim prayer rooms in a western Australia hospital on the basis that they need to avoid the idolatry that may occur if they share. Our public schools are adapting to a Muslim Perspectives curriculum project in which, among many other things, not just female-only swimming is recommended for our Muslim students, but exclusively Muslim-only swimming (these are all sounding much like apartheid practices). Some public schools are catering to diversity by ensuring truckshops [cafeterias] are exclusively halal."

This coincides with similar initiatives in the US, where (until public attention compelled them to take it down) the Muslim Brotherhood group known as the Muslim Students Association's website featured a "Muslim Accommodations Task Force" page. It included PDFs of pamphlets titled "How to Achieve Islamic Holidays on Campus," "How to Establish a Prayer Room on Campus" and "How to Achieve Halal Food on Campus."

The demands of Muslim groups all over the Western world for separate facilities are in the service of a supremacist ideology that emanates from the Koranic assertions that Muslims are the "best of people" (3:110), while unbelievers are the "vilest of created beings" (98:6). Unbelievers are unclean (9:28) which leads to the conclusion that Muslims should avoid contact with them. Every capitulation made to demands for Muslim accommodation only feeds these supremacist notions, working directly against the principles of equal justice and equal rights for all.

Nevertheless, Left-leaning Western politicians are eager to accommodate these demands. While I was in Australia, the Deputy Premier of Queensland, Andrew Fraser, denounced the Q Society for fliers protesting against the sale of halal meat that was not labeled as such, and the introduction of misleading and whitewashed material about Islam into Australian schools. "Modern Australia has a proud multicultural heritage," thundered Fraser. "This kind of prejudicial rubbish has no place anywhere, let alone here in Queensland." So in Fraser's view, to advance an apartheid-like systems that institutionalize the oppression of women and non-Muslims serves Australia's "proud multicultural heritage," but to resist that system in the name of freedom and equality of rights for all is "prejudicial rubbish."

In reality, such demands are part of the stealth jihad that endeavors to advance Islamic law in Western countries through nonviolent means and what better way to accomplish this than by playing on the West's fears of racism and bigotry to win concessions as a victimized group? The irony here is that the Australian and American politicians who allow themselves to be used in this way are abetting the advance of a system that is far more repressive and ridden with inequalities than anything in any modern Western country. But they will probably only realize this when they themselves fall victim to that system, as - if it continues to advance - they certainly will.

Mr Sarvari told the Iranian student news agency ISNA: 'Soon we will hold a military manoeuvre on how to close the Strait of Hormuz. If the world wants to make the region insecure, we will make the world insecure.'

Parviz Sarvari, a member of the Iranian parliament's National Security Committee, said his country was preparing to close off the crucial Strait of Hormuz as part of a military exercise. Around a third of all shipped oil passes through the four mile-wide Strait between Oman and Iran and US warships patrol the area to ensure safe passage. Most of the crude exported from Saudi Arabia, Iran, the United Arab Emirates, Kuwait and Iraq - together with nearly all the liquefied natural gas from lead exporter Qatar is transported through the channel.

Iran has warned it will respond to any attack by hitting Israel and US interests in the Gulf and analysts say one way to retaliate would be to close the Strait of Hormuz.

"In the past three decades, or so, many of the mainline Christian churches have slipped away from their foundation on the Holy Scriptures and adopted more and more secular tenets and leftist, politically correct, philosophy until they have become only a shadow of the true followers of Christ," he penned on Tuesday. "In my opinion, those denominations can no longer claim to be 'Christian' churches simply because - they are not." A few years ago, the US Army veteran had left his own denomination for the same reasons, seeing that it had chosen to forsake the tenets of the Bible and the Good News of the Gospel. Though he admitted that he was in no way a "better Christian than any other follower of Christ," he believed that many of the mainline denominations in America today were nothing more than social clubs with franchises nationwide.

"Their pastors 'preach' feel good 'sermonettes' about the environment and things like 'social justice.' In my opinion, that is not the mission of a church that purports to follow Christ. In fact, Christ, Himself, spelled out the mission of the church in what we refer to as The Great Commission." The Great Commission stated in Matthew 28:18-20 reads: "Then Jesus came to them and said, 'All authority in heaven and on earth has been given to me. Therefore go and make disciples of all nations, baptizing them in the name of the Father and of the Son and of the Holy Spirit, and teaching them to obey everything I have commanded you. And surely I am with you always, to the very end of the age."

That commission from Christ is the sole reason why the church exists today, Longstreet stressed. "To fulfill that mission the church must stand firmly upon the foundation of the Holy Scripture and the teachings of the Christ. That means insisting that the standard(s) set by Christ are, and remain, the guiding force behind everything the church does ... that means pastors are compelled to preach that those things the Scripture marks as sin are duly, and publicly, noted from their pulpits as SIN. If a church is reluctant to do this, or refuses to do this, then, in my opinion, that church is not a Christian church."

The conservative commentator lamented that in America, pastors were afraid of preaching from the Scriptures, worried about the consequences - lawsuits, slander, or even embarrassment. "It is a very real threat, especially to the evangelical church in America," he added. "As a result, those churches which hold true to the Gospel, now feel that they must consider meeting in secret for Bible classes, for worship services, or other Bible centric gatherings."

Britain's rejection of last week's agreement, backed by the EU's other 26 leaders, gave Merkel respite from foreign media caricatures casting her as a Kaiser or Fuehrer intent on dominating Europe. But she won only fleeting relief, as US magazine Newsweek brought out a cover warning: "Achtung! It's Angela!"

While mainland Europe looks aghast at Britain's growing euroscepticism, polls suggest Germans are growing weary of the euro zone and are less impressed by their chancellor's crisis management than post-summit headlines first suggested. Even her allies warned Merkel not to assume easy passage of decisions taken at the summit, such as handing over some budget sovereignty to Brussels and moving up the launch of the euro zone's permanent bailout mechanism by a year, to mid-2012.

"The Bundestag (parliament's lower house) will study whether constitutional problems could arise from the EU Commission or a European currency commissar intervening directly in national budgets and parliament's control of the budget," said Bundestag speaker Norbert Lammert from Merkel's Christian Democrats (CDU).

In a country whose Constitutional Court subjects such things to close scrutiny, Lammert called it "very ambitious" to expect parliament to approve the new bailout fund, or European Stability Mechanism (ESM), fast enough to bring it into effect a whole year ahead of schedule.

Netanyahu made the announcement on the 30-day anniversary of the passing of his father-in-law, Shmuel Ben-Artzi, who was a respected Israeli poet and Bible teacher. Ben-Artzi used to attend the regular Bible studies hosted by Israel's first prime minister, David Ben Gurion.

"Ben-Gurion understood that the Book of Books is our mandate for our country," Netanyahu said. "He viewed the Bible as the wondrous story of the Jewish people, the unique spiritual, cultural and historic heritage of our people, and also as one of the cornerstones of all of human culture."

The father of Netanyahu's Likud Party, Menachem Begin, also used to host regular Bible studies at the prime minister's residence. Netanyahu said he wanted to reinstate that practice in order to encourage love of the Bible among government officials, and by extension, the nation.

While the protests attracted fewer people than the 10,000 who turned out on November 2 to shut down Oakland's port, organisers declared victory and promised more demonstrations to come. "The truckers are still here, but there's nobody here to unload their stuff," protest organiser Boots Riley said. "We shut down the Port of Oakland for the daytime shift and we're coming back in the evening. Mission accomplished."

Organisers called for the "Shutdown Wall Street on the Waterfront" protests, hoping the day of demonstrations would cut into the profits of the corporations that run the docks and send a message that their movement was not over.

The longshoremen's union did not officially support the protests, but its membership cited a provision in its contract that allowed workers to ask to stay off the job if they felt conditions were unsafe. Some went home with several hours' pay while others left with nothing. The movement, which sprang up this autumn in New York against what it sees as corporate greed and economic inequality, is focusing on the ports as the "economic engines for the elite". It comes weeks after police raids cleared out most of their tent camps.

Now Germany, the US, China, Japan and Canada have all expressed major doubts about the plan. The German Bundesbank said it will give the IMF more money only if other EU and non-EU countries do the same. However, President Obama said Europe has "enough resources" to deal with the problem on its own.

The plan is for the 17 eurozone countries to provide 125 billion pounds but EU officials said the Bank of England could be asked to contribute some of the balance. But Foreign Secretary William Hague has vowed that British taxpayers will not have to pay more to help the IMF prop up the eurozone. "We wouldn't agree to the IMF to use extra funding specifically designated to help the euro," he said.

One even claimed ending the rebate was a suitable alternative to "a declaration of war" involving tanks and Kalashnikov rifles. In a further salvo, European Commission president Jose Manuel Barroso accused Britain of risking the "integrity" of the EU's single market. Demands to scrap the UK's rebate - worth 2.7 billion pounds this year - were raised during a debate in the European Parliament about last week's tumultuous EU summit. It failed to reach a deal after Mr Cameron blocked plans for new EU powers of "economic governance" without safeguards to protect the City of London.

Yesterday cracks in the anti-British alliance began to show when Sweden's government signalled it may not back the new eurozone "fiscal compact". Swedish prime minister Fredrik Reinfeldt said: "It is very clear that we do not have all the facts and unless we have that, it's tough to make a final verdict."

It includes spending 118 million pounds to demolish and build a new office block near to their Brussels headquarters and to buy another. A further 13.5 million pounds will be spent on buying and renovating a building that currently belongs to the Council of Europe in Strasbourg - the Parliament's second home that it uses only 10 times a year for four days at a time.

Britain's Conservative MEPs, who opposed the proposal, condemned it last night. Leader Martin Callanan said: "The euro is on a life support machine, the whole of the continent is in crisis, and some MEPs are getting on with what they do best - making their own lives more comfortable."

Supporters of the Brussels scheme say the extra space is for an ever-growing number of staff, partly driven by the arrival of 18 new MEPs as a consequence of the Lisbon Treaty.

The euro rescue deal appeared to be in serious trouble last night as the single currency crashed on international money markets. As doubts emerged in several countries over whether an agreement struck late last week will ever come into force, Germany's Angela Merkel sent the euro into a tailspin as she ruled out beefing up a bailout fund for debt-stricken eurozone economies.

Ratification of a deal creating an effective single EU economic government appeared fraught with difficulty last night in Sweden, Holland, Denmark, Finland and the Czech Republic. There are even doubts over whether France will implement the package after its main opposition party - currently on course to oust Nicolas Sarkozy in elections in April - rejected the deal.

Amid bitter recriminations in Brussels over David Cameron's decision to veto last week's attempt at a new EU-wide treaty, senior figures said they would now try to strip Britain of its annual EU rebate in an act of vengeance.