2012 12 03 cmyk na 04

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* * * * * * MONDAY, DECEMBER 3, 2012 ~ VOL. CCLX NO. 130 WSJ.com HHHH $2 .00

CONTENTSAbreast of the Market C1Corporate News B2,3,6,9Global Finance........... C3Heard on the Street C8Law Journal................. B7Market Data................ C4

Media............................... B4Moving the Market C2Opinion.................. A15-17Sports............................ B10U.S. News................. A2-6Weather Watch........ B9World News......... A8-13

Lastweek: DJIA 13025.58 À 15.90 0.1% NASDAQ 3010.24 À 1.5% NIKKEI 9446.01 À 0.85% STOXX600 275.78 À 0.9% 10-YR. TREASURY À 25/32 , yield 1.607% OIL $88.91 À $0.63 EURO $1.2986 YEN 82.47

s Copyright 2012 Dow Jones & Company. All Rights Reserved

Vital Signs

The dollar is depreciat-ing against China’s cur-rency. One dollar buys6.2267 yuan, one of thelowest levels since Chinalaunched a modernized cur-rency-trading system in1994. Last week, the U.S.Treasury Department re-peated that China’s cur-rency remains “significantlyundervalued” but declinedagain to label Beijing a cur-rency manipulator.

Number of Chinese yuanone U.S. dollar buys

Source: FactSet

'09 '10 '11 '12’08 '09 '10 '11 '12’086.00

6.50

7.00

7.50

>

Delta has approachedSingapore Airlines about

buying its 49% stake in Vir-gin Atlantic. The U.S. carrieris interested in Virgin for itsaccess to London’s HeathrowAirport, the world’s biggestinternational hub by traffic.If Delta were to secure thestake, it would give the U.S.airline one of the most ro-bust global networks. B1nMartin Marietta will likelyexplore a friendly bid forgravel and sand supplier Vul-can, rather than launch an-other hostile takeover bid. B1n State insurance regulatorsapproved a change in the waylife insurers set reserves forfuture claims, a move thatcould improve their returns. C1n Three big ad companieshave ratcheted down theirforecasts for 2013 globalgrowth in ad spending. B4n Cerberus is weighing sev-eral options for a Supervaludeal, including buying the en-tire business and purchasingonly its Albertsons stores. B3nWall Street JournalMan-aging Editor Robert Thomsonis expected to be chosen to runNews Corp.’s soon-to-be-cre-ated publishing firm. Mean-while, News Corp’s U.K. news-paper chief is resigning. B4n SEC Chairman Schapirodelayed a rule potentially af-fecting billions of dollars ofofferings because of con-cerns about her legacy. C1n Banks and securities firmsare under pressure to tightentheir belts fast enough to keeppace with shrinking sales. C1n Recent optimism aboutSpain’s bond market may beshort-lived, as the countrymust regain the confidenceof foreign investors. C1n An ECB official said thebank’s bond buying has cuteuro-zone borrowing costsand reduced concerns aboutthe currency union. A12n China’s manufacturingand services sector bothpicked up in November, neweconomic data showed. A11

n The U.S. increased spyingon an Iranian nuclear plant.The stepped-up surveillanceof the Bushehr reactor wasdriven by heightened con-cerns about the security ofweapons-grade plutonium af-ter Tehran unexpectedly dis-charged fuel rods from the fa-cility in October. The U.S.scrutiny has been conductedin part by drones operatingover the Persian Gulf. A1The surveillance underscoresthe limits of U.S. knowledgeabout Iran’s military andscience bureaucracy.nMorsi’s Islamist allies be-sieged Egypt’s high court toblock a ruling on the legitimacyof a panel drafting a constitu-tion the opposition rejects. A8n Taliban insurgents at-tacked a key coalition base inAfghanistan but failed to pen-etrate the installation. At leastfive Afghans were killed. A13nTheWhite House and con-gressional Republicans re-mained at loggerheads over adeficit-reduction package, justweeks before the fiscal cliff. A4nDemocratic lawmakers andstrategists say the success ofObama’s second termmay rideon how this battle unfolds. A4n Israel said it is freezing thetransfer of about $118 millionin tax revenue it collects forthe Palestinians in the wake ofa U.N. vote on statehood. A10n Syria’s army fought rebelsaround Damascus’s airportfor a fourth straight day as ittries to halt the opposition’sentry into the capital. A10nMyanmar named Suu Kyi tolead an inquiry into last week’sbloody crackdown on protest-ers at a copper mine. A13nNorth Korea’s timing of arocket launch this month is be-ing seen as a bid to influenceSeoul’s presidential vote. A11nPsychiatry’s new guide toclassifyingmental illness, theDSM-5, was approved by theU.S. psychiatrists’ board.A2n Heavy snow in Russiastranded motorists on a ma-jor highway in a traffic jamdozens of miles long. A13

Business&Finance World-Wide

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THE SUBLIMESHOWDOWNJASONGAY SPORTSHigh-Tech Dividends INVESTING IN FUNDS

A SPECIAL REPORT

What’s News–i i i i i i

What’s Ahead—MONDAY, DEC. 3 Figures on October con-struction spending arescheduled for release. Auto makers tally vehiclesales for November. The Institute for SupplyManagement reports resultsof its manufacturing survey.TUESDAY, DEC. 4 Both the EU finance minis-ters and NATO foreign minis-ters are meeting in Brussels.WEDNESDAY, DEC. 5 October factory orders arescheduled for release. The Labor Department is-sues revised estimates ofthird-quarter productivity.

The ISM publishes its ser-vice-sector index.THURSDAY, DEC. 6 The government reports oninitial jobless claims.FRIDAY, DEC. 7 The University of Michi-gan’s consumer-sentiment in-dex is due. Figures on con-sumer credit also are on tap. The Labor Department re-ports on the employment sit-uation for November. International envoysgather in Rome to discussMali, where much of thenorth of the country is heldby Islamist militants.

For the week ahead in corporatenews, see page B2.

TABATINGA, Brazil—Two Brazilian police boltedfrom a helicopter in Peru’s Amazon jungle on a re-cent day with a squad of Peruvian commandos.Cracks of gunfire shook the forest before the groupcaptured and destroyed a secret cocaine lab.

The Brazilians had the legal status of unarmedobservers during the Aug. 19 raid led by Peru’selite antidrug police.

But both Brazilians carried assault rifles andfaced hostile fire. The lab was in Peru, but theraiders flew from a Brazilian airport in a chopperrunning on Brazilian fuel to hit a target providedby a Brazilian-paid informant.

From its Amazon border with Peru to its bus-tling cities, Brazil is getting drawn deeper into adrug war as surging cocaine use turns it into theworld’s biggest market after the U.S. It is a sur-prise since Brazilian politicians once criticized ag-gressive antidrug strategies espoused by the U.S.as causing more harm than good.

Now, Brazil is adopting a controversial U.S. tactic:reaching across borders to stop cocaine at the source.

“Brazil is crossing a threshold that it hasn’teven come close to in the past,” said DouglasFarah, a national security consultant who advisesthe U.S. Department of Defense on Latin Americaand drug issues.

Conventional wisdom is that Latin America isshifting away from the U.S.-backed war on drugs.In April, longtime U.S. drug allies such as Colom-bian President Juan Manuel Santos used the an-nual Summit of the Americas to call the U.S.’s 40-year Latin American drug war a failure anddemand a debate on alternatives such as decrimi-nalization.

But the case of Brazil suggests Latin America’sdrug war is expanding, not shrinking. Though Co-lombia and Mexico have doubts about U.S.-backeddrug interdiction strategies, neither country hasaltered course. Meantime, Brazil, Latin America’sbiggest economy by far, is becoming a participantafter decades spent mostly on the sidelines.

President Dilma Rousseff is deploying up to10,000 soldiers at a time to drug smuggling hotspots. Brazil also agreed to buy 14 Israeli-made

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WASHINGTON—The U.S. hassignificantly stepped up spyingoperations on Iran’s Bushehr nu-clear reactor over the past twomonths, American officials said,driven by heightened concernsabout the security of weapons-grade plutonium after Tehran un-expectedly discharged fuel rodsfrom the facility in October.

The increased U.S. surveillanceof Bushehr, on Iran’s southwest-ern coast, has been conducted inpart with the Pentagon’s fleet ofdrones operating over the PersianGulf. The effort resulted in the in-terception of visual images andaudio communications comingfrom the reactor complex, theseofficials said.

Tehran suggested an Americandrone was spying on Bushehr onNov. 1 when it sent Iranian fighterjets to pursue the unmannedcraft, firing at it but missing. Thedrone in question was conductingsurveillance that day, but not onBushehr, U.S. officials said.

U.S. officials stepped up sur-veillance after becoming alarmedover activities at Bushehr, espe-cially the removal of fuel rodsfrom the plant in October, justtwo months after it became fullyoperational, officials said. Nuclearexperts said they are more con-cerned about safety at the reac-tor, for now, than about the pros-pect that Tehran will use thefacility to develop atomic weap-ons.

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BY JAY SOLOMONAND JULIAN E. BARNES

U.S. RaisesMonitoringOf IranianReactor

Exporting the U.S. shale en-ergy revolution overseas turnsout to be far tougher than any-one expected—giving the U.S. asignificant competitive advan-tage.

Shale oil and natural gas haverejuvenated the North Americanenergy industry and boosted theeconomy by supplying companiesand consumers with cheap fuel.There are huge shale depositsoutside of North America thatglobal energy companies andgovernments are eager to tap.

But oil companies are runninginto obstacles as they try to rep-licate the U.S. experience onother continents. The result isthat significant overseas shaleenergy production could be a de-cade away.

Among the reasons for theglacial pace abroad are govern-

ment ownership of mineralrights, environmental concernsand a lack of infrastructure todrill and transport gas and oil. Inaddition, much less is knownabout the geology in most for-eign countries than in the U.S.,where drilling activity has beengoing on for more than a cen-tury.

The upshot: the U.S. and Can-ada could remain the main coun-tries to reap the economic ad-vantages of shale development

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By Russell Goldin Austin, Texas,andMarynia Krukin Lobocino, Poland

GlobalGasPushStallsFirms Hit Hurdles Trying to Replicate U.S. Success Abroad

BY JOHN LYONS

Brazil ReachesAcrossBorderTo Battle Source of Cocaine

MOMENT OF SILENCE: The Kansas City Chiefs paused to remember victims of domestic abuse before Sunday’s game at Arrowhead Stadium.Jovan Belcher, a linebacker for the team, killed his girlfriend Saturday before driving to the team’s practice facility and killing himself, police said. A6

Jamie

Squire/G

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Images

Greeks Seek Strength in the PowersOf a Revered Monk to Predict Events

i i i

Elder Paisios Expected Travails;A Skeptical Facebook Page Draws Ire

SOUROTI, Greece—Legend hasit that nearly three decades ago,a bearded Orthodox Christianmystic visiting here made an un-settling prediction: Greece in thefuture would experi-ence a “great disrup-tion and confusion,”followed by hunger andpolitical turmoil.

Believers say thisgrim vision of ElderPaisios, an asceticmonk who died in1994, was actually aprescient glimpse ofthe upheaval now grip-ping this debt-rackedcountry—helping fuel asurge of interest in the Orthodoxholy man by Greeks struggling tomake sense of a brutal financialcrisis.

Elder Paisios, who spentmuch of his adult life as a her-mit on the monastic peninsula of

Mount Athos in northeasternGreece, has become a popularsensation—with tales of hisprognostications and miracles heis said to have performed postedonline and recounted in popularbooks.

On Saturdays, hun-dreds of pilgrims lineup at Elder Paisios’sgravesite here, waitingtheir turn to kneel,pray and kiss thewooden cross thatmarks his final restingplace. They ask for helpfinding jobs, payingbills and surviving adownturn that has up-ended their lives.

“Paisios predictedmany things, and his propheciesare now coming true,” said Cos-tas Katsaounis, a 41-year-oldmilitary officer on a visit to theshrine. “He foresaw the crisis.But he also said it would get bet-

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Elder Paisios

BY GORDON FAIRCLOUGH

A Somber Lineup in Kansas City

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