Obama picks Yellen to succeed Bernanke at Fed

WASHINGTON - President Barack Obama will nominate Federal Reserve vice chair Janet Yellen to succeed Ben Bernanke as chairman of the nation's central bank, the White House said Tuesday. Yellen would be the first woman to head the powerful Fed, taking over at a pivotal time for the economy and the banking industry.

Both Yellen and Bernanke are scheduled to appear with Obama at the White House today for a formal announcement.

Bernanke will serve until his term ends Jan. 31, completing a remarkable eight-year tenure in which he helped pull the U.S. economy out of the worst financial crisis and recession since the 1930s.

Under Bernanke's leadership, the Fed created extraordinary programs after the financial crisis erupted in 2008 that are credited with helping save the U.S. banking system. The Fed lent money to banks after credit markets froze, cut its key short-term interest rate to near zero and bought trillions in bonds to lower long-term borrowing rates.

Yellen, 67, emerged as the leading candidate after Lawrence Summers, a former Treasury secretary whom Obama was thought to favor, withdrew from consideration last month in the face of rising opposition.

As default looms, there are hints of a compromise

WASHINGTON - President Barack Obama and House Speaker John Boehner offered hints of possible compromise but also traded heated rhetoric Tuesday, a frustratingly inconclusive combination that left the eight-day partial government shutdown firmly in place and the threat of an unprecedented national default drawing closer.

"There's a crack there," Boehner said of the impasse near the end of a day of maneuvering at the White House and the Capitol. Yet the Ohio Republican added that it was not enough to warrant optimism.

Stocks fell significantly - the Dow Jones average by 159 points - as political gridlock endured. And, in the latest in a string of dire warnings, the International Monetary Fund said failure to raise America's debt limit could lead to default and disrupt worldwide financial markets, raise interest rates and push the U.S economy back into recession.

Republicans "don't get to demand ransom in exchange for doing their jobs," Obama said at the White House. "They don't also get to say, you know, unless you give me what the voters rejected in the last election, I'm going to cause a recession."

Even the deaths of U.S. servicemen over the weekend in Afghanistan were grist for the politicians. The Pentagon said that because of the partial shutdown it was unable to pay the customary death benefits to the survivors.

Two win Nobel prize in physicsfor Higgs boson

STOCKHOLM - Nearly 50 years after they came up with the theory, but little more than a year since the world's biggest atom smasher delivered the proof, Britain's Peter Higgs and Belgian colleague Francois Englert won the Nobel Prize in physics Tuesday for helping to explain how matter formed after the Big Bang.

Working independently in the 1960s, they came up with a theory for how the fundamental building blocks of the universe clumped together, gained mass and formed everything we see around us today. The theory hinged on the existence of a subatomic particle that came to be called the Higgs boson - or the "God particle."

In one of the biggest breakthroughs in physics in decades, scientists at CERN, the European Organization for Nuclear Research, announced last year that they had finally found a Higgs boson using the $10 billion particle collider built in a 17-mile tunnel under the Swiss-French border.

In a statement issued by the University of Edinburgh, where he retired as a professor, the famously shy, 84-year-old Higgs said he hoped the prize would help people recognize "the value of blue-sky research."

Englert, 80, said the award pointed to the importance of scientific freedom and the need for scientists to be allowed to do fundamental research that doesn't have immediate practical applications.

Cairo scarred by 2? years ofturmoil, violence

CAIRO - Egypt's capital has long been proud of its nickname, "Mother of the World" - a metropolis of 18 million throbbing with the vitality and fun of other great cities, even if at times it seemed unmanageable and chaotic.

But Cairo's spirit has been deeply scarred by 32 months of turmoil and bloodshed from two "revolutions," constant protests and crackdowns, and a military coup.

Residents talk of an unfamiliar edginess. People are more suspicious of each other, whether because of increased crime or constant media warnings of conspiracies and terrorism. Families are split by bitter ideological differences. Fights are sparked by a word or a gesture seen as supporting either the military or the Islamists who were ousted from power by the armed forces.

The mood goes beyond ideology. With police battered by the upheaval and rarely enforcing regulations, many people flout laws with no thought of the consequences - whether it's the cafes that take over sidewalks or thugs who seize plots of land.

- The Associated Press