28/06/2012 Newsnight

A sewer much systematically and amoral dishonesty, some of the

choice descriptions of some of our bankers. The shock waves from

Barclays continues as there are calls for a criminal investigation,

and civil lawsuits for fiddling a key lending rate. Bob Diamond says

the decision to manipulate the market was wrong, but who took it?

Have the people who have almost bankrupted the world economy proved

themselves morally bankrupt? Another last-chance saloon in

Brussels, with Angela Merkel refusing to budge a centimeter, we

will discuss the German Chancellor's stubbornness, or is it

admirable consistency, with one of her ministers and a noble prize

winner, who thinkss the policies are suicide. As Julian Assange goes

to Sweden tomorrow night e gives Newsnight his response. You have

been summoned to bell gravia police station tomorrow, are you going to

go? Our advice is internationally and domestically in the UK takes

precedent to extradition law, the answer is certainly not. Have the

scientists finally run the God particle to ground, and can we

explain what it does? Good evening, systematic greed, systemic failure,

like an epitaph to an age of irresponsibility, just a few of the

comments on the latest crass and potentially illegal activity in the

banking sector. With calls for banking boss, Bob Diamond to resign

were will it lead. While they promised a bottle of champagne for

their mates, how much more will the taxpayer tolerate. We begin with

our Economics Editor, and Bob Diamond's most public response to a

letter to the chairman's committee. What did Mr Diamond have to say?

Bob Diamond refers to two things that Barclays did in manipulating

this key interest rate, The Libertines. They did it for one

machine, to enrich themselves, boost their own trades. Diamond

says it was done by junior people, we have collaberated with the

inquiry, let's get on with it, the Serious Fraud Office can do what

they want, we're sorry, we have taken the fine. Then he refers to

the second reason. The second reason was that this interest rate

is a good barometer for the financial health of banks. And at

one point, between 2007-2009, Barclays were coming out of the

daily interest rate setting looking bad. It looked like they were a

bank in trouble. Therefore, they expressed, the senior management,

expressed their concerns. This is what the Financial Services

Authority had to say yesterday, they said senior management

concerns resulted in instructions being given by less senior managers

to reduce The Libertines submissions, that is fiddle the

rate, they say the origin of the instructions is unclear. In today's

letter Mr Diamond says he accepts the decision to lower submission

was wrong. He also intimate that is decision

was discussed with the Bank of England, and even with politicians,

for example the Brown -Darling administration at the time. Junior

bank managers do not have discussions with Gordon Brown and

Mervyn King and discuss whether or not they can legitimately mess

around with The Libertines, that decision had to be taken by

somebody senior. I asked them the question tonight, who was it? And

it is, as it is like for the last 48 hours, it is like asking

children in the playground who has done the naughty thing, nobody

wants to answer and we are waiting for an answer.

The markets, Barclays' shares closed down 15%, and the political

response has been absolutely vehement? The normal choreography

of this is outrage, and then you take a fine, you collaberate with

the SFA, somebody gets prosecuted down the line. Then politicians

stand up and say we mustn't let this damage the status of the City

of London, and Barclays is an important institution, blah blah.

Instead today, they said the absolute opposite, they went for

the jugular on Diamond and the Barclays senior management. We

heard David Cameron and Osborne go for him by name. The reason is

pretty clear, this is a systemic, reputational hit for the City. It

is making the City and done as a vein -- London as a venue for doing

business very shaky, there is worry throughout the industry about it.

That is why the politicians are so hard on them.

What exactly is going on at Barclays and how did traders fix

the InterBanking lending rate, LIBOR? Make no mistake about it,

this rate-fixing scandal will hit the banking sector, starting with

Barclays chief, Bob Diamond, like a nuclear bomb. It could prove as

destructive to the industry as the financial crisis of 2008. Even

though the collusion started in 2005, its origins can be traced

back to 1987, Big Bang, swept aside the bowler hatted brigade, and

opened up the City to a world where laissez faire ruled, and markets

would clarify and lickify. It started with Barclays, Barclays'

fair price was in free fall, as the extent of the problem dawned on the

market, which doesn't fancy the bank without Bob Diamond at the

helm. The next wave is imminent, Barclays got a smaller fine

yesterday, in return, no doubt, for squealing on other banks, watch out

RBS and Lloyd's. That makes the prospect of US-style lawsuits more

likely, benefiting lawyers mostly. One can see an outward mushrooming

effect on this, armed with these admissions from Barclays and the

evidence obtained from Barclays, e- mail, taped transcripts of

conversations between traders, that a powerful case could be built

against the others. That, in my view, would concentrate the find of

the others, and they will have a choice. Do we too come clean and

get the discount for an early admission, or do we tough it out

and try to say we weren't a party to this.

Then there is the long-term damage to the City of London's reputation.

It has already been hit by scandals at AIG, JP Morgan and UPS, will it

still account for 10% of British GDP in a decade. The wider economy

won't escape either, this scanned kal will almost certainly lead to

tighter regulation for banks, which means less profits and less lending

to customers. It is the bald eagle bank in the

firing line, when a UK Prime Minister, arriving at an EU summit,

subjects that a banking boss has serious guess -- suggests that a

banking boss has serious questions to answers, it is a message, go,

and go now. As I said today people have to take responsibility for the

actions and show how they will be accountable for those actions, it

is important it goes all the way to the top that have organisation.

Other Tory MPs weren't as polite, calling directly on Bob Diamond to

resign. The opposition said it was time white collar criminals went to

jail. I do want to see criminal prosecutions, and those who have

done the wrong thing, those who have committed what I think are

atrocious acts, brought to justice. Things stepped up a gear today, Bob

Diamond confirmed that he will appear before MPs on the Treasury

Select Committee, in the next fortnight. Just's did last year,

when he said banker bashing had to end. He will be joined, no doubt,

by his chairman, Marcus Agius, seen here on the left, who is running

the board at Barclays at the height of this scandal, his head may also

be on the chopping block. Today also saw the British Bankers'

Association, under whose auspices LIBOR rates have been set for three

decade, call on the Government to assume responsibility for them in

the future. Meanwhile the FSA is said to be in talks with big banks

for financial settlement for small firms, in particular, the City

watchdog is also set to announce tomorrow, a new mis-selling probe

into the banks, which would sully their reputation even further. At

the moment there is something of an omerta going on between the banks,

as they lift up stones in their banks to see what traders have or

have not been up to, and whether the regulator has any evidence of

it. Banks are looking nervously at each other to see which one breaks

rank first, and lead to a settlement that makes the PPI pay

outs look like pocket money. Tonight it is clear why the scandal

happened in the first place, investment bankers who gamble with

larger sum, are allowed to work in a set of lower expectations than in

the general public -- those who deal with the general public.

will take an integrity test in this sector, we help people understand

what is integrity and they can prove and demonstrate it, there is

no requirement in the wholesale market. We should be applying the

same principles now applied in the retail sector to the wholesale

sector. Make sure professional people belong to professional

bodies, abide by that Code of Conduct, and take integrity

properly and for what it is worth. This led to the kind of unethical

behaviour at the heart of this scandal, this is something I

prepared earlier. John and Simon work at separate parts of the bank

and shouldn't be in touch professional ever. John has made

bets on a derivative linked to The Libertines rate, needs the rate to

go down. John illegally contacts Simon, a colleague whose job it is

to set The Libertines rate. Simon is supposed to ignore all

communication from John, in this scandal doesn't. At the daily LIBOR

fixing session, Simon suggests a lower rate than it should be,

knowing it will help John and the bank. Even if it will only work for

a few days a month, tiny changes can be worth millions to John and

billions to the bank. We will never know how much loss was minimised as

a result of this be backle. But it the fall-out means things will

never be the same for the banking sector again.

The Treasury Minister, Mark Hoban is with me. Is Bob Diamond a fit

person to run a major bank? He has questions to answer, why did it

happen, why wasn't it identified by its own staff and what change has

happened since it happened, what change in procedures, has the

compliance operation been beefed up. All these questions need to be

answered by Bob Diamond. It is important he goes before the

Treasury Select Committee to hear from him what has changed. He can

run a major bank for the next couple of week, either somebody who

knew what was going on, which would be terrible, or he didn't know what

was going on, which would be incompetent? We need answers from

Bob Diamond. Barclays did identify this, and raise it with the FSA, we

need to get some answers about this. You are prepared to wait for the

Treasury Select Committee to have a chat with him in a few weeks time,

you presumably meet these people all the time, you have met Bob

Diamond? On the basis of what you know, would you be perfectly happy

to trust him with running a major British bank? It is very clear, as

the Prime Minister said today, that Bob Diamond has questions to answer,

we should get those answers from him. Also, there are other banks

involved in this. This is part of a long-running investigation, we need

to get to the bottom of this. What has happened. A number of

Conservative MPs, who I presume you respect highly, say this man should

just go? The chairman of the select committee has invited Diamond in

front of his committee to get some answers. There is clearly

identified a gap in regulation, the regulatory system that Ed Balls

designed made sure LIBOR was not regulated. We need to resolve this.

People rely on this. Is this a regulatory lapse or complete moral

lapse, that there is something absolutely rotten, somewhere in

Barclays Bank? I think there are two issues, what happened in the

individual banks and how do we get to the bottom of that, but also,

why is it this area of market activity was not properly regulated,

it was a gap in the regulatory regime we inherited from the

previous Government and we are seeking to close it. George Osborne

said today we will regulate LIBOR and lock at what needs to be done,

and look at criminal sanctions to be put in place. The chairman is in

charge of corporate governance, should Marcus Agius think of going,

clearly nobody was at the helm here? I think the answer is we need

to get to the bottom of this, there are questions Barclays needs to

answer, the FSA report takes us so far. Things clearly went astray in

Barclays, we need to know why that happened, why it wasn't picked up

sooner and what has changed. Would you like to see criminal

prosecutions, fraud is fraud, there may be no specific offence you can

put your finger on that was mentioned in this, but if people

had been cheating and fixing rates, that is presumably, potentially

fraud, isn't it? I think the hypocrisy of the Labour Party today

calling for criminal sanctions when their rules didn't actually allow

criminal sanctions to take place. You can score points if you like.

This is the worst abuse of trust in a British bank in living memory I'm

asking you as a Treasury Minister what you can do about it? With what

we need to do, is there is action going on in individual banks

looking at individual people, the FSA haven't completed their

investigation, not just of banks but individuals, but we also need

to look at every angle possible that we can take criminal action

where fraud has been committed. would support the potential for

criminal action, you think that would be a good idea if there was

found to be fraud committed. You were clear on that, yes? Yes.

bonuses should be clawed back from some of these people? The changes

we introduced ensure bonuses can be clawed back, previously bonuses

were paid in cash and couldn't be Claude back, we have introduced

rules -- clawed back, we have introduced rules for them to be

clawed back. The very reputation of the City of London is at stake

here? I agree, that is exactly why we have taken action, since we came

into office, to change the regulatory system in the UK, put

the Bank of England in charge of banks, give regulators more power

to intervene quickly and not allow problems to fester. We need to do

that for London to maintain its reputation. London is a big ployer,

two million people involved in financial services across the UK,

we need to sort this out to make sure the reputation stays strong.

Are you concerned that we ain't seen nothing yet, we have seen HSPC

and RBS are subject of inquiries? There are inquiries across a range

of banks, we need to get to the bottom of it, Barclays is the first

one where a fine needs to be announced. Do you think the people

in charge of banks in Britain act morally, or simply in their own

personal interest, is there a greed culture that needs to be addressed?

Alistair Darling mentioned it today in the House of Commons. He said in

the run up to the financial crisis there was a culture of anything

goes. We saw that in the way which LIBOR has been manipulated, we saw

some of the huge gambles that bankers took in the run up to the

financial crisis. We need to tackle it and reform regulation, and

tackling investment sides of banks as we did through the Vickers

report. Samuel Beckett's great play,

Waiting for Godot was described as a piece of theatre where nothing

happens twice. European Summits seem to be like, that nothing

happens more or less perpetually. We are in Brussels. Has anything

happened tonight? I think it has. I beg to differ on the Beckett

analogy, at least so far as the politics and diplomacy are

concerned. Six months ago we were here, Europe was rallying behind an

austerity pact, tight controls over Government spending under the

leadership of France and Germany. Today France has a different

President, Germany is isolated, the French have joined in the pressure

for measures to alleviate the economic crisis, the called growth

package. Germany has come here, intent on signing that off, about

�100 billion worth of stimulus for the European economy. Where they

have failed and the Beckett analogy is appropriate, is tackling the

underlying economic causes, and trying to get their own heads

straight about whether it is the short-term or long-term solutions

that are really the issue. Tonight they have been failing to agree on

all sorts of things, because of battle on precisely those grounds,

is it the short-term crisis that needs tackling now, or the long-

term package that needs to be passed through. That is a battle

between Germany and Italy. First the mighty Germans dealt with

Greece. To the delight of their leader. Tonight, it was Italy, and

then they hoped Spain. In the footy as in politics, Germany likes to

call the shots. But unlike the beautiful game, in Brussels, Angela

Merkel must take them all on at the same time. So she is now a minority

of one. It is basically the other big three, the French, the Spanish

and the Italians against her, and she doesn't have allies here they

European Commission, she doesn't have allies at the IMF. Every

international institution, she doesn't have allies outside in the

G8, the UK and the US are pressuring her now. Not even here

in Brussels, but in the world now she's incredibly isolated. She's

beginning to feel the pressure. My discussions with German officials,

they get very defensive. They really feel the pressure right now

that they are in a corner by themselves.

Arriving, the German leader delivered a positive message about

funding growth programmes. An olive branch to those countries that

think her vision of austerity stifles any growth. TRANSLATION:

Today we will talk about the pact for growth and jobs. We have

created a good programme here, in particular, with regard to

investment in the future. And moreover, what will create more job

opportunities, especially for young people. I hope that we will be able

to agree on this today, and with that, make an important signal.

Also for the fiscal pact that we need solid budgets on the one hand,

and on the other hand, growth and jobs.

Of course, everybody here wants Germany to take a bigger role in

underwriting the debts of weaker EU countries, but Angela Merkel has

come here today saying her position is essentially unchanged, she is

prepared to work towards fiscal union, but only in the very long-

term, and with a host of safeguards about the way other countries spend

European money. What we want first is tighter, stricter, long-term

rules so this never happens again. Once we get those rules, then we

can start talking about solidarity and sharing. In that sense, it is

not a question of backing up on something right now, we need

incentives for good public management of money. That is what

the Germans the Finns and the Dutch are calling for. That sounds like a

continuation of the argument we have heard for months now, which

comes first, the rigour or the solidarity, is it possible to

achieve agreement on that? Probably, that means the chicken has to come

out at the same time as the egg. this summit fixture, Germany's

opponents want to change the rules. There are several proposals, a

banking union including rules on savers and deposits, a joint

European Treasury Department, scrutinising spending plans and

enforcing bugetry discipline. For future national budgets to be

planned at the European level. But in this game, Germany controls any

movement of the goal posts. It is not ready to do so, leading to

growing anxiety in Spain and Italy. There does seem to be movement on

the Spanish, Italian issue, Mario Monti, uncharacteristically, for

the very boring economist as he is, has started pounding the table

saying he needs something, his tenure is almost up, he only has

six months left as Italian Prime Minister, you remember what Italy

is like before me, it will be like that after me, if we want Italy

solved we need to do it now, I needing to home to say all the hard

work was worth something. Could the meeting help the Italians while the

bigger debate is going on? There are a couple of proposals,

including this one from the Finns. What Finland has proposed is

something called the a covered bond, it is something done in the early

1990s, the state issues a bond that is covered, or guaranteed with

assets, or equity, or, for instance, earmarked taxes, once that has

happened, then the long-term crisis mechanism, which we call the ESM,

comes and backs it up. This could be something that brings the

interest rates down n that sense it is a compromise but not something

that Germany needs to back down on. That type of short-term measure

won't bother David Cameron. But in the bigger, long-term agenda of

financial integration, there is a fork in the road looming for

Britain. One that may well require a national vote. We're saying to

the eurozone countries they do need to do more things together, to

strengthen their currency and make sense of their currency, but

Britain will stay out of that. We want Europe to work for us as a

single market, as place where we trade, as place where we co-operate,

I'm going in there to make sure we get the safeguards to make sure

that can keep happening. Tonight the struggle to win through had

gripped the Council of Europe. But it was the football that had

mesmerised the waiting press and officials. In this game, outcomes

can still surprise. In the contest of European Summitry,

the difficulty of reaching atreatment, and the slowness of

change, are realities that are all too familiar.

With me is the Nobel Prize-winning economist, Joseph Stiglitz, who has

written a new book, The Price of Inequality, he argues an

increasingly divided society is endangering our future. We have

Peter Altmaier, the German Minister for the Environment. He joins us

from Berlin. Angela Merkel has been very

consistent over the years, but that consistency has brought us three

years of summits, with the euro repeatedly on collapse, what will

be different this time? We have accepted a number of proposals from

our European partners over the last two-and-a-half years. We have

created huge rescue operations and funds. German tax-payers' money is

involved at a scale of several hundred billion euros. We have now

been ready to accept a gross package, that is financed by

European tax-payers' money, but we have to insist at the same time

that something is also done in implementing on a national level in

these countries, in order to restore the confidence of

international financial markets. People will understand Angela

Merkel's political problems. How she has to convince German voters

and tax-payers. However, you are isolated. Debt mutualisation is

supported by the council President, the commission President, the

Spanish Prime Minister, the French President, the Italian Prime

Minister, they are all wrong, are they? No, they are not wrong. But

this is the normal kind of procedure in European Summits. I

can remember over the last two-and- a-half years, several summits where

it seemed to be the case that we would be isolated. But at the end

of the day, we were able to organise an enormous and large

consensus, that happened last year in November, when all countries

agreed on the German-French proposals, and just two countries

stayed away, the UK and the Czech Republic. I'm basically optimistic,

this summit can become a success story. We are on the first day and

we will have very, very tough talks and negotiations, but it can lead

us to a consensus. OK, but Frau Merkel is talk about others

offering eye wash and fake solution, but the German solution over the

two-and-a-half years you are talking about has got us to the

state where Greece is ruined, Italy and Spain find it difficult to

borrow, and democracy itself is under threat in some of those

countries? In Greece we have seen a national parliament election, where

reasonable, pro-European parties have made it. And extreme party

could have won? But they didn't win, they lost as a matter of fact. In

Italy and Spain we have Governments really interested in achieving

progress. I'm basically optimistic, and if we can manage tonight and

tomorrow to come to conclusions about the long-term reforms of the

European Union, I'm optimistic we can convince markets to restore

confidence and trust in countries like Spain, and we have made it

clear, if Spain would apply for money under the fund, we would be

prepared to consider that. OK, let me bring in Joseph Stiglitz here,

you have also been very consistent in what you have written about

austerity. You have said it is effectively suicidal. Wouldn't you

accept that Angela Merkel's position, if she were to say, let's

give a lot of money to southern European economies, we don't think

they have been run very well, that would be suicidal? Part of the

problem is the diagnosis of the underlying problem. Spain and

Ireland had a surplus before the crisis. They have a deficit because

Europe is in recession. It is the recession that caused the deficit,

not the other way around. If you begin with the wrong diagnosis you

will get the wrong prescription. Germany has been giving them the

wrong prescription. The German prescriptions over the last three

years have led to a depression in Spain. One out of two Spanish

people are out of work. They want to work, the young people. The

unemployment rate has gotten consistently higher. Its not

approach -- it is now approaching one out of a four. Those

prescriptions have not worked. The case of Greece. They say they are

having reform. Number one in the OECD in having reforms. You can't

do everything overnight in a democracy, but they have done a lot.

Number one in reform. Let me bring in Peter Altmaier on that,

austerity may be right for a healthy economy like Germany, but

it has been terrible for Spain and Greece? We have agreed on a gross

package. This is on the agenda today and tomorrow. First thing,

second thing, in Greece some reforms have been implemented, and

for the first time we see some signs of a growing economy again.

There is a decrease of self- percentage in Greece of growth?

depends on the month you are considering, and we have the

impression that the Greek economy is strarting to recould have. In

Spain we have -- starting to recover. In Spain we have to admit

it is just a couple of months since the new Prime Minister has taken

over, and he has then introduced a number of reforms, it is probably

much too early to see the real effect of these reforms. What we

have to provide is solidarity. We made clear we want to preserve the

euro as a common currency, for all 70 member states. What we made

clear is Germany is prepared to encourage growth by spending more.

What we have made clear is all countries have to undergo reforms.

Joseph Stiglitz, if you were talking to the German taxpayer

tonight who is funding all of this, what is in it for them? Why should

they do this without the austerity and the reforms? Because of the

cost of the break-up of the euro for Germany is very, very high.

Let's talk about the growth part. Everybody agrees that you need

growth. They agreed on that last July. A year ago. Nothing happened.

What about the agreement they are talking about right now. $150

billion or so. Most of that is old money repackaged. I know the

political ways. We are known in our country to repackage money?

estimation is $10 billion is really new money. Is part of your point

that Germany has benefited from being in the euro, you are writing

about inequality in all sorts of ways, does Germany have a moral

duty to end some of the inequality by spreading the money around?

think it is in their self-interest, if they could understand their

enlightened self-interest, rather than the short-term self-interest.

I think it is in their long-term self-interest in doing this. I do

think there is a sense of solidarity. By solidarity I don't

mean tying your legs together as you go over the cliff, a suicide

pact. I mean solidarity helping some countries who are having

difficulty, because of a global downturn caused by the United

States. Let me bring in Peter Altmaier, it would be in your own

interest to spread money around, not just an act of charity? Indeed,

I whole heartedly agree. We are interested in preserving the euro.

We are interested in providing solidarity to the other countries.

But if it is true that the crisis is the result of the fact that we

have spent too much money over too many years, then we cannot cure

that crisis by spending even more money that does not exist. That is

where you came in on the problem? That is the fundamental

misdiagnosis. You heard our discussion earlier about Barclays

Bank and the culture of greed that has infected the banks. What do you

make of that, are you at all surprised some people were fiddling

The Libertines rate? I knew about that earlier -- The LIBOR rate?

knew about that earlier, there was no surprise. It is a pattern of

behaviour we have seen in banks all over the world N my book I talk

about it as moral depravation. It wasn't as good as the word you used

"the sewer". Do you think they live in a different moral universe than

the rest of us? I think they do. It is partly a result of a culture and

set of incentives that have been provided for them. The incentives

to, a culture of greed, a framework that allow them to get away with it.

You will have heard this argument repeatedly in the United States, by

Conservative economists who say it is not a culture of greed but a

culture of aspiration. It is good people are unequal, because people

at the bottom aspire to get to the top. That is how the United States

economy has grown for two years, that is the argument? The problem

that this Barclays scandal brings out so clearly, is that a lot of

what was going on is what I call rent-seeking, in other words, it

wasn't creating more wealth, it was manipulating the rules of the game

to steal somebody else's money. It wasn't growing the pot. It was

getting a larger share of the back, and in doing that weakening the

economy. This is a really important point, the kind of thing they do

weakens the economy. That's why I have been arguing that we could

have a stronger economy, more growth, with more equality.

Just as we round up our conversation, Mr Altmaier, we have

17 countries in the eurozone right now, do you think in five years

time there is still going to be 17 countries in the eurozone? I would

say 17 countries or even more. think it will become so popular

that people will be clamouring to join the euro zone rather than get

out of it? There are many countries interested in joining the eurozone.

It is my view that the eurozone has been stablised over the last few

days not destablised. Greece is a now a reliable partner, in Spain

and Italy we have to cope with the spread in interest rates, but these

are sound economies and we can overcome the crisis. They would be

sound economies if the policies of austerity were not being imposed on

them. If there was real commitment to growth, which would require a

European solidarity fund for stablisation. If there were a

guaranteed fund for all the banks. Without that money will flow from

these countries to Germany, which has, in effect, because the German

Government is backing the Germany banks, there is an implicit subsidy

toe German banks and an unlevel playing field F you address the

fundamental problems, then the strengths of the European countries

are very strong. Do you think we see every day, politicians in

Europe and we will hear it again tomorrow, this is a political

project, we are committed to it, the answer is more Europe. We will

hear all of that, is that encouraging to you, given that the

economics are not quite going in the way you have described? I have

heard them saying that for now for a long time. Having heard,

particularly from Germany, the kind of solidarity, the kind of real

agreement on, and an understanding, of really the basic of what needs

to be done. It is not that complicated, from an economic point

of view. If you have a single market, if you have money that can

flow easily around that single market, you have to have a single

banking system, single guarantee, and a single regulator. I agree,

you need a framework that works. You need a solidarity fund for

growth, a single one. We will leave it there.

The WikiLeaks founder, Julian Assange, is tucking up for his

ninth night at the Ecuadorian embassy in ens can heingen to

tonight. Earlier today the embassy had a visit from two Metropolitan

Police -- Metropolitan Police Officers. They want him to be

extradited to Sweden where he can face charges of sexual assault.

Holed up inside behind drawn curtains, and sleeping, apparently,

on an inflatible mattress, Julian Assange is under diplomatic

protection. Police can't arrest him unless he steps outside. The

pressure on him is building. At 9.00am, two police officers turned

up at the embassy, with a letter, ordering Julian Assange to appear

at bell gravia Police Station some morning from 11.30am, where from he

will be put on a plane, so, will he surrender. Mr Assange you have been

summited to appear at Belgravia Police Station tomorrow, will you

go? Our advice is that the answer is almost certainly no, because the

law takes precedence over extradition law. It was the release

of this shocking footage that first brought WikiLeaks to international

attention, and embarrassed the American Government. It shows the

killing of a group of Iraqis, including two journalists, by a US

helicopter gunship, after fight anything Baghdad in July 2007. A

flod of secret US documents on the wars -- flood of secret US document

ones the wars in Afghanistan and Iraq arrived, and classified cables.

Julian Assange said America convened a secret Grand Jury to

tart him and other members of the group. In the United States, since

at least the beginning of 2011, a US Grand Jury has been impanelled

in Washington, it has been pulling in witnesses, and false testimony

from these witnesses, and speened records from Twitter, and they have

been working with the FBI. Earlier this year, confidential e-mails

appeared from a defence intelligence company that does work

with the Pentagon. Julian Assange say they bolstered his fears. One

reads, "not for publication", they have a sealed indictment on Assange,

another says that he will make a nice bride in prison, screw the

terrorist, that he will be eating cat food forever. He's a criminal

and should be hunted down and grabbed and put on trial for what

he has done here. This guy is a traitor, a traessonist, and broken

every law in the United States, shoot the son of a BEEP. We have

criminal proceedings under way. Julian Assange sent us a selection

of television interviews which showed the depth of feeling against

him. He has still not been charged with anything. But the man who is

the source of the biggest leak of US state secrets in history has

been charged with aiding the enemy. Numerous individuals have said they

were compelled to testify before a Grand Jury. On top of that we have

had the Bradley Manning proceedings, I have been observing them on

behalf of WikiLeaks. Our concerns about the risk of extradition were

confirmed in those proceedings. Whatever the reality, Julian

Assange, a deeply devisive figure, is now he is centre of an exorder

knee -- extraordinary legal battle. He lost his battle in the High

Court, and then he walked into the Ecuadorian embassy. The last week

has confirmed a lot of what we know about Julian Assange and his

organisation, which is they think they are above the law, whether

laws about dealing and trafficking Government information, or whether

you should be accountable to the same laws as the rest of them.

women accused Julian Assange in Stockholm of sexual offences, that

is why the Swedish authorities want to question him. Their lawyers say

with his asylum appeals he has created a diversion. What do you

say to the women and their lawyers in Sweden that they should have a

right to charge you? I haven't been charged. You have nothing to say to

the two women? What has been said in public record is sufficient.

Julian Assange says he's safer in the UK than Sweden, because it is

hard for the US to extradite him from here, while he still faces

judicial proceedings in Stockholm. Can he really avoid being put on

that plane to Sweden? Exdor is still making up its behind --

Ecuador is still making up its mind on his asylum claim, even if it

does take him in, how does he get there, with the police poised to

arrest him. If you think a solution to the eurozone's problems is

elusive, how about the attempt to figure out whether a fundamental

particle, known as the his bos son, sed said to be the Kiev figuring

out the universe, even exists. What what have you been hearing? Towards

the end of last year we had the first tantalising glimpses of the

Higgs Boson, it is the missing piece in a jigsaw of the standard

model, where fist siss understand how the fundamental particles of

the universe interact. If they can't find it they are in trouble,

and they will have to re-think everything. We will have the

results soon from SERN, smashing together beams of protons, two

teams working separately looking in the debris to see can they find a

sign of the Higgs Boson. These two teams have been gathering data at a

high rate, more in the first few months n2012, than they did -- in

2012, than they did in 2011. Next week we will get a significant

update in the hunt for the Higgs. One respected scientist told me

that what we will see is what anybody with any sense will regard

as the real deal. I don't think they are going to announce a formal

discovery that they found the Higgs Boson. The reason for that is an

official discovery requires a level of certainty in their result,

called a five sigma level, a five- star rating, last year one had a

two-and-a-half-star rating, and the other three-stars, that is about

three-stars. This time I'm told both teams have done better. Last

year it was a two or three-star significant ma leak in each

experiment. Now I'm expecting four stars in each experiment. The

calibrations from the teams don't want to collaberate their date tax

they want to individually analyse the data until they individually

get to the five-star level. Of course, we who are not members of

the team, know we will get the computers out and do the

calculation, I'm pretty sure we will conclude that the hix has now

reached the level of -- Higgs has now reached the level of a five-

star level. Have they found this thing or haven't they? They are

holding back. The reason they are officially holding back, is to

announce a formal discovery of the Higgs Boson is a really important

moment in modern physics and they want to get it right. They are

withholding as much more international politics as science,

each team wants to claim discoverry, and neither wants to combine their

teams, several countries has money behind one team, the UK has money

in both teams and doesn't mind much if they have to combine data for

the discoverry some want to wait until both teams have enough to

claim the five-star rating. That won't come until later this year.

Before we look at the front pages, here is an extraordinary image that

has come too late for the papers, Nadal crashing out of Wimbledon in

the second round to Rosol. A relatively unknown player who is

ranked 100th. You don't see that very often. Now

the front pages. The Times has RBS facing a �150 million fine as the

Apology for the loss of subtitles for 56 seconds

That's all from Newsnight tonight, after almost 70 years, the

surviving scam bomber Boys, finally saw a memorial unveiled in their

honour today. We wanted to leave you with pictures of poppies being

dropped from a Lancaster to commemorate the event, and a report

on a real bombing raid in 1948. master bomber is calling again,

giving us, once again, our height, our bombs are going, the flack is

bursting under us, we are going over the top now, fire, I don't

know how we can stand this, we are sinking with the flack. How steady

and calm are the skipper and crew. Now the bombers are bursting there

now flash, flash, flash, crash. I'm sorry, I tried to be contained,

and steady on this commentry, it is more than I can do. It is a

staggering sight that we can see in the sky.

The storms have cleared away and tomorrow is cooler and fresher. For

the Midlands it is noticably cooler today, the band of cloud in the

south-east of England threatens to bring a little rain at Wimbledon

tomorrow. A lot of cloud for the south west and Wales and the North

West of eing lan. -- England. Northern Ireland, again a few

showers around, but again, not as heavy or thundery as we have seen

it today. In Scotland we will see quite a lot of cloud, showers

across the central belt, and across the south west. It could be a

little on the heavy side. Of course, it will be rather cool as well. We