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VOL. CCLXI NO. 27 * * * * * *

SATURDAY/SUNDAY, FEBRUARY 2 - 3, 2013

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WSJ.com

WEEKEND

America’s

BabyBust

REVIEW

ChooseYourOwnFoodAdventure

OFF DUTY

n The Dow industrialsmoved above 14000 for thefirst time since 2007, follow-ing a raft of positive eco-nomic news. The Dow gained149.21 points to 14009.79. A1n Investors with big stakesin Apple are taking a beat-ing, even as U.S. stocks areflirting with record highs. B1n Exxon and Chevron re-ported higher quarterlyearnings, boosted bystrength in oil refining. B1n Shares of Zoetis, Pfizer’sanimal-health unit, rose 19%in their trading debut. B3nWashington Post is look-ing at selling its headquar-ters, after other publishershave made similar moves. B3n HSBC and the Thai com-pany buying its stake in PingAn Insurance won approvalfrom China for the largerpart of the deal. B2n Boeing is expected in thecoming week to reach an as-sembly milestone for itsstretch Dreamliner without afix for what has bedeviledthe electrical system. B1n Sycamore Networks, onceworth nearly $45 billion, allbut went out of business asits shareholders voted todissolve the company. B1n Time Warner Cable CEOGlenn Britt will step down atthe end of the year. B3

What’sNews

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Business&Finance

World-Wide

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CONTENTSBooks..................... C5-C10Cooking.............. D1-2,6-7Corporate News..... B1,3Heard on Street.......B14Ideas Market............... C4Letters to Editor.... A14

Opinion.................. A13-15Sports..................... A10-11Stock Listings...... B4,10Style & Fashion......... D9Travel........................... D3-4Weather Watch........ B8Wknd Investor.... B7-10

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InsideNOONAN A15

RepublicansSuddenly

Break the Ice

n Panetta cited antiaircraftweapon smuggling by Iran.The defense secretary ac-cused Iran’s paramilitaryforce of an intensified cam-paign to destabilize the Mid-dle East by smuggling themissiles to its militant allies.Panetta said that the U.S. isstepping up efforts to coun-ter the Iranian threat. A1The weapons are a majorconcern for Israel, whichborders territory con-trolled by Iran’s allies.n The White House outlinedoptions for letting religiousorganizations opt out of con-traception requirements inthe 2010 health-care law. A3n Former Sen. Scott Brownsaid he won’t run for theMassachusetts Senate seatvacated by John Kerry. A4n Several Democratic sena-tors pledged to vote to con-firm Chuck Hagel as the newsecretary of defense. A4n Energy Secretary Chu isleaving his position afterfour tumultuous years. A4n Pemex said early indica-tions suggest the blast thatkilled at least 33 at its head-quarters was an accident. A8n A suicide bombing at theU.S. Embassy in Turkeykilled a Turkish guard. A7n The NBA players associa-tion said it placed its unionhead on leave of absence. A6n Died: Ed Koch, 88, thethree-term mayor of NewYork who developed into aninternational personality. A5

A raft of positive economicnews drove the Dow Jones Indus-trial Average above 14000 for thefirst time in more than five years,with Friday’s jobs numbers coun-tering a surprising report earlierin the week that the economycontracted at the end of 2012.

The government’s main snap-shot of the labor market showed

employers added 157,000 jobs inJanuary and hired more workersin 2012 than previously estimated.

The labor report reinforced theview that the economy is growingat a steady, but excruciatinglyslow, pace. Housing is recovering.The latest reading from purchas-ing managers suggested manufac-turing is perking up after slum-bering for a few months. AndCongress has averted a debt-ceil-ing crisis, at least for now, though

spending cuts loom.Big problems remain, including

a stubbornly high jobless rate. Fri-day’s report showed unemploy-ment ticked up to 7.9% in Januaryfrom 7.8% the month before.

The stock market has been ona tear lately, and Friday’s gainpushed the Dow higher by 149.21points, or 1.08%, to 14009.79. Feb-ruary’s strong start comes afterthe blue-chip measure notched itsbest January in nearly two de-

cades. The Dow has climbed 6.9%so far this year, and is 155 pointsaway from a record.

The Standard & Poor’s 500-stock index gained 15.06 points, or1.01%, to 1513.17, and is now 3.3%from its record high. The NasdaqComposite rose 36.97 points, or1.18%, to 3179.10. All three majorbenchmarks have posted gains forfive consecutive weeks.

The recent move higher hasbeen powered by several trends.

Corporate earnings have beenstronger than expected, the Fed-eral Reserve shows little sign thatit will wind down its stimulus ef-forts and the domestic economyis showing signs of improving.

At the same time, investorscontinued to show growing con-

Pleaseturntothenextpage

BY JOSH MITCHELLAND JONATHAN CHENG

Economy Drives Market RallyDow Vaults Over 14000, Highest Close Since 2007, Propelled by Upbeat Jobs, Manufacturing Reports

WASHINGTON—Defense Sec-retary Leon Panetta accusedIran’s paramilitary force of anintensified campaign to destabi-lize the Middle East by smug-gling antiaircraft weapons to itsmilitant allies.

Iran’s export of so-calledmanpads—antiaircraft missilesthat can be carried by a singleperson—represent what Mr.Panetta called a dangerous esca-lation.

“There is no question whenyou start passing manpadsaround, that becomes a threat—not just to military aircraft butto civilian aircraft,” Mr. Panettatold The Wall Street Journal inan interview describing shiftingthreats to the U.S. as he pre-pares to leave his post. “That isan escalation.”

Western officials have longworried about the spread of suchweapons and the risk they poseto airline passengers as well as

to military helicopters and jets.Recent U.S. intelligence pointedto new efforts by Iran to smug-gle manpads, but few shipmentshad been intercepted before Jan.23, when Yemen, aided by theU.S., intercepted a boat carryingthe weapons.

“It is one of the first times wehave seen it,” Mr. Panetta said.

U.S. investigators said evi-dence indicated the missileswere supplied by the IslamicRevolutionary Guard Corps, Teh-ran’s paramilitary force.

Iranian officials didn’t re-spond to requests for commentabout distributing weapons toregional allies.

Mr. Panetta said the U.S. isstepping up efforts to counterthe Iranian threat, and is leadinga multination exercise in theUnited Arab Emirates thoughFeb. 7 to improve the interdic-tion of Iranian arms and otherweapons. The defense secretarycalled the exercise critical tobuilding up Arab capabilities tohelp halt Iranian arms transfers,including the smuggling of man-pads.

The disclosures by Mr.Panetta came as he prepares tostep down after 19 months asdefense secretary, a periodmarked by an intensified focus

PleaseturntopageA7

BY JULIAN E. BARNESAND ADAM ENTOUS

Panetta:IranianThreatSpreads

AYUTLA, Mexico—Masked men, riflesslung over their shoulders, stand guardon a lonely rural road, checking IDs andquestioning travelers. They wear no uni-forms, flash no badges, but they are thelaw here now.

A dozen villages in the area have risenup in armed revolt against local drugtraffickers that have terrorized the re-gion and a government that residents sayis incapable of protecting them from or-ganized crime.

The villages in the hilly southern Mex-ican state of Guerrero now forbid theMexican army and state and federal po-

lice from entering. Ragtag militias carry-ing a motley arsenal of machetes, oldhunting rifles and the occasional AR-15semiautomatic rifle control the towns.Strangers aren’t allowed entry. There isa 10 p.m. curfew. More than 50 prisoners,accused of being in drug gangs, sit inmakeshift jails. Their fates hinge on pub-lic trials that began Thursday when theaccused were arraigned before villagers,who will act as judge and jury.

Crime is way down—for the moment,at least. Residents say kidnapping ceasedwhen the militias took charge, as did theextortions that had become the scourgeof businessmen and farmers alike. Theleader of one militia group, who uses the

code name G-1 but was identified by hiscompatriots as Gonzalo Torres, puts itthis way: “We brought order back to aplace where there had been chaos. Wewere able to do in 15 days what the gov-ernment was not able to do in years.”

Yet a few shaken townspeople inAyutla, the area’s primary town, havestories of being arrested and held formore than a week before being deemedinnocent and released. And one man wasshot dead trying to escape the maskedmen at a checkpoint.

Village justice has long been part oflife in rural Mexico. Now it’s playing agrowing role in the country’s drug war.

PleaseturntopageA12

Mexico’s Masked VigilantesDefy Drug Gangs—And the Law

BY NICHOLAS CASEY

A vigilante at a checkpoint in Ayutla, Mexico, where villagers have risen in armed revolt against drug traffickers and federal authorities.

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treetJournal

Fast-Running Quarterback Has a Slow Sidekicki i i

Tortoises, Which Can Live 150 Years, Are a Lot to Tackle; ‘Eat, Walk Around, Eat’

Rick and Teresa Kaepernickwill be in New Orleans for theSuper Bowl on Sunday, cheeringfor their son, Colin, to sprintaway from Baltimore Ravens try-ing to crush the San Francisco49ers’ lightning-quick quarter-back.

But once they’re back home inCalifornia, there’s a slower-mov-ing behemoth that his parentswill be keeping a wary eye on:Their son’s 115-pound Africanspurred tortoise, Sammy. Thebeast, still not full-grown, has apropensity to devour the fam-ily’s shrubbery, crash through

fences and bump intopeople.

He could also liveanother 135 years.

So while the Kaep-ernicks are delightedthat fans have fallenin love with theirson—jerseys with hisname on them are hotsellers—they advisefamilies not to be-come instantly infatu-ated with the likes of his tor-toise. “All they do is eat, walkaround, eat, walk around” saysRick Kaepernick.

Experts on the Africanspurred tortoise tend to agree.

Tortoise-rescue work-ers say there is a pro-liferation of the Geo-chelone sulcata—orsimply “sulcata”among aficionados—needing adoption, fol-lowing a craze thatthey say began about10 years ago as deal-ers began breedingthem more.

In California, res-cue shelters are getting hun-dreds a year compared withmaybe 20 five years ago, saysGinny Stigen, president of theSan Diego Turtle and TortoiseSociety. “We’ve had people liter-

ally stop on the side of a freewayand let them out,” says Ms. Sti-gen, who worries that Mr. Kaep-ernick’s pet might inspire fans tobring baby tortoises into theirfamilies.

The trouble: Those babies arecute, but then they get big. Up to200 pounds.

Kristin Roman of Staten Is-land, N.Y., says she fell for hersulcata, Big, when he was apalm-size hatchling in 2002. “He

PleaseturntopageA10

BY JIM CARLTON

Sammy

Sources: Labor Department (jobs); Institute for Supply Management (PMI); Commerce Department (GDP); WSJ Market Data Group (DJIA) The Wall Street Journal

JOBS Net monthly change, in thousands FACTORIES Manufacturing activity GDP Quarterly change at an annual rate STOCKS DJIA weekly close

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'08 '09 '10 '11 '12 '132007

800

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'08 '09 '10 '11 '122007

14000 previous high: 14164.53

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2007 '08 '09 '10 '11 '12 '13

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January: +157,000 53.1, expanding faster

4th qtr.: –0.1% Friday 14009.79Up 1.08%

Super Bowl coverage......... A10-11 Lighting up halftime.................. C11 $16,650 for two tickets?!...... D10 All weekend:WSJ.com/superbowl

More on stocks; why it’s hardto limit U.S. exposure........ B1, B5

Heard on the Street................. B14

U.S. intelligence pointsto new efforts by Iranto smuggle antiaircraftmissiles to allies.

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