Caught in the Web, 1860. Federal agents arrested hedge-fund manager Bernard Madoff and charged him with running a $50 billion Ponzi scheme, possibly the largest in Wall Street history. Madoff faces a maximum penalty of 20 years in prison and $5 million in fines; he had hoped to distribute his last $200 million to friends, family, and favored employees before his arrest, but was turned in by his sons. SECNYTBloombergWSJNYTRepublicansenators killed a plan to loan $14 billion to American automakers, and the White House said it would consider other options to save the industry and as many as three million …

After more than a week of fighting and one failed cease-fire, Russia and Georgia signed a revised cease-fire agreement, but Russian troops remained within 25 miles of the Georgian capital, Tbilisi. Russian President Dmitri Medvedev promised French President Nicolas Sarkozy, who negotiated the agreement, that Russian forces would soon withdraw from Georgia. He also insisted that troops would remain in the breakaway Georgian territory South Ossetia. “The superpower showed that she was able to defend her people,” said Marina Katayeva, a 30-year-old Russian doctor. “Now we will be more respected.” Georgian President Mikheil Saakashvili said Russians were “twenty-first-century barbarians” who …

The U.S. Office of Thrift Supervision seized the IndyMac Bank of California, worth an estimated 32 billion dollars, after the bank’s closure in the wake of mortgage industry collapse,AFPand the Bush Administration proposed a rescue package for ailing mortgage companies Fannie Mae and Freddie Mac that would allow the Treasury to buy billions of dollars of their stock and lend them billions more to meet their short-term funding needs. The two companies’ total debt is estimated at $1.54 trillion.NYTimesAbu Dhabi bought New York City’sChrysler building for $800 million,GuardianUKand the Belgian brewer InBev planned to buy Anheuser-Busch for nearly $50 billion.AP …

The Cloaca Maxima, 1872 Iranian President Mahmoud Ahmadinejad, hailed by his countrymen as the “Socrates of the Third Millennium” for “disarming other speakers through his sharp reasoning,” gave a speech on Monday in which he claimed that Iran had no homosexuals and disavowed reports of his nuclear ambitions. “Let me tell a joke here,” Ahmadinejad said. “I think the politicians who are after atomic bombs, or testing them, making them, politically they are backward, retarded.” On Tuesday he met with Zimbabwe President Robert Mugabe, addressed the United Nations (where he announced that he would disregard any resolutions adopted by the …

Caught in the Web, 1860. General David Petraeus and Ambassador Ryan C. Crocker testified to Congress about progress in the war in Iraq; Crocker summarized 2006 as “a bad year,” but blamed ongoing sectarian violence on Saddam Hussein’s “social deconstruction” of the country. Petraeus cited progress in the Anbar region as evidence that his surge strategy is working. He suggested that one Army brigade might be home for Christmas, and that the surge might be over by next July. Barack Obama proposed removing at least one brigade per month, starting now, until all troops are out by the end of …

The Cloaca Maxima, 1872 Iraqis took to the streets after the national soccer team beat Saudi Arabia 1?0 in the Asian Cup championship. At least four people were killed by “happy fire” in the midst of what were reported to be the largest spontaneous celebrations in Iraq since the fall of Saddam Hussein. “Sport brings us together while the heads of everything in Baghdad can’t bring us together for five years,” said one reveler. “If the Iraqi football team ruled us, peace would spread in our home.” Each member of the Lions of the Two Rivers will receive $10,000 from …

Paul Wolfowitz announced that he would resign as president of the World Bank on June 30; the Bank in turn said that it accepted Wolfowitz’s assurances that he had acted “in good faith” when he oversaw a promotion for his girlfriend Shaha Riza.Fin24MSNBCThe GuardianJames B. Comey, deputy for former attorney general John Ashcroft, testified to the Senate Judiciary Committee that on March 10, 2004, Alberto Gonzales and Andrew Card had attempted to persuade Ashcroft (who was hospitalized and had temporarily given up his authority as attorney general to Comey) to reauthorize the Bush Administration’s domestic surveillance program, even though the …

The Cloaca Maxima, 1872 The U.S. House of Representatives passed a timetable for ending the Iraq war by a six-vote margin. The bill mandates American withdrawal in September 2008 if the Bush Administration meets certain benchmarks, earlier if it does not. Several Democrats voted against the timetable because it was not sufficiently antiwar, and Republicans derided the inclusion of domestic provisions benefiting spinach growers, citrus farmers, salmon fishermen, and peanut storers. “What does throwing money at Bubba Gump, Popeye the sailor man, and Mr. Peanut have to do with winning a war?” asked Representative Sam Johnson of Texas. “I will …

Caught in the Web, 1860. President George W. Bush gave the State of the Union address, in which he discussed plans to balance the budget, double the size of the Border Patrol, reduce gasoline consumption in the United States by 20 percent, and institute a tax deduction to help American workers afford private health insurance. He announced that he was sending more than 20,000 additional soldiers to Iraq, asked Congress to authorize an increase of 92,000 active soldiers over the next five years, and proposed forming a “Civilian Reserve Corps.” He complimented several guests on their heroic kindness, courage, and …

The Iraqi parliament voted unanimously to extend the country’s state of emergency, and President George W. Bush, who declared himself a “realist,” disavowed a leaked White House memo that suggested that Prime Minister Nouri al-Maliki was either dumb, weak, or a liar. Maliki responded by canceling a dinner date with the president.New York TimesCybercast News Service and New York TimesInternational Herald TribuneIran’s supreme spiritual leader, Ayatollah Ali Khamenei, said that “the continuation of Iraq’s occupation is not a mouthful that Americans can swallow.”Breitbart.comMarine Corps intelligence in the Sunni Triangle determined that U.S. forces were “no longer capable of militarily defeating …

George W. Bush in Vietnam (White House photo). In Hillah, Iraq, a man promising work lured day-laborers into a minivan, then blew it up, killing 22 people. “The ground was covered with the remains of people and blood,” said a laborer, “and survivors ran in all directions.” Thirty people were killed in attacks in Mosul, Baquba, and Baghdad, four American security contractors and an Austrian were kidnapped in Basra, and a deputy health minister was kidnapped in Baghdad. “Where is the government?” yelled a woman in Mashtal, after multiple bombs killed 11 civilians. “Women and children were killed. God is …

Midterm elections were held in the United States; the Republican Party lost its majority in the House of Representatives and the Senate. Six incumbent Republican senators, including Rick Santorum of Pennsylvania, were defeated, and Santorum’s daughter cried. Nancy Pelosi of California, who is expected to become the first female Speaker of the House, had lunch with President George W. Bush.Reuters via Yahoo!MSNBCBoston.comIn Iraq the parliament extended the nationwide state of emergency by 30 days, and eight soccer players and fans were killed by mortar rounds. “We are the Shiite nation,” yelled a man from his hospital bed.MSNBCThree U.S. soldiers, four …

President George W. Bush officially replaced the phrase “stay the course” in Iraq with “We will stay in Iraq,” and Iraqi Prime Minister Nouri al-Maliki insisted he never agreed to a U.S. timetable for reducing sectarian violence. “I’m not America’s man,” he said.Chicago TribuneNew York TimesNews.com.auDefense Secretary Donald Rumsfeld told critics of the war to “back off.”Yahoo NewsIn Basra, Prince Philip of Britain assured the troops “at the sharp end” that “a great many locals do very much appreciate what you are trying to do for them,”New Zealand Heraldand Senator Rick Santorum said, “As the hobbits are going up Mount …

President George W. Bush signed the Military Commissions Act, which suspends the right of habeas corpus for terrorism suspects and grants immunity to CIA interrogators and government officials, such as President Bush, for violations of the War Crimes Act. New York TimesChicago Sun-TimesDomestic security officials notified seven football stadiums of a discredited threat of radiological bomb attacks out of an “abundance of caution,” New York Timesand the United States Coast Guard announced plans to mount 7.62 mm, M-240B machine guns on official boats in the Great Lakes. Rear Adm. John E. Crowley Jr. said, “I don�??t know when or if …

Killing Ground. Iranian president Mahmoud Ahmadinejad, speaking at the United Nations in New York, proclaimed his love for all the world’s peoples, and suggested that the United States halt domestic fuel production and buy its energy from him “at a fifty percent discount.”BBC NewsVenezuelan president Hugo Chavez objected to the smell of sulfur in the U.N.’s General Assembly hall, and offered to relocate the U.N.’s headquarters to Caracas. New York timesFox NewsTed Turner called the Iraq war one of the “dumbest moves of all time,”CNNand a spokesman for the Iraq Study Group, a think tank created to analyze events in …

A kinkajou, 1886. The Pentagon announced that civilian casualties in Iraq had increased recently by more than fifty percent, and death squads were said to be torturing and killing as many as 1,800 people per month.New York TimesAt least 200 Iraqis were killed in bombings, rocket attacks, and shootings, as were 19 American and British soldiers.CNNNPRU.S. Attorney General Alberto Gonzales visited Iraq to encourage “the rule of law,” andicasualties.orgNPRReutersReutersReutersSapa-AP via Independent OnlineReutersReutersAP via Houston ChronicleU.S. Secretary of DefenseDonald Rumsfeld quoted Georges Clemenceau, who said, “War is a series of catastrophes that results in a victory.”Washington PostIran ignored a U.N. Security …

Runaway Raft on the Tigris. Thousands of U.S. Marine reserves were involuntarily recalled to active duty to offset a lack of volunteers for the fighting in Iraq and Afghanistan.CNNPresident George W. Bush admitted that the Iraq war was “straining the psyche of our country,”Washington Postand Secretary of State Condoleezza Rice refused to categorize the fighting in Iraq as a civil war, citing instead “sectarian differences.”Washington PostThree Kurdish women testified against Saddam Hussein in his chemical-weapons genocide trial, describing a “sweet, mysterious smell” that blinded them, killed their relatives, and forced them to hide in caves.New York TimesA senior U.S. general …

Killing Ground. Israel insisted it had no immediate plans for a large-scale ground invasion of Lebanon, although it seized two Lebanese towns, called up 10,000 troops to the border, and called thousands of reservists to active duty. Almost 400 people (362 Lebanese, 37 Israelis) have been killed so far in the conflict. European governments debated the proportionality of these deaths, and Syrian president Bashar Assad told the international community to stop procrastinating and broker a ceasefire.NY Times and The AustralianPresident Mahmoud Ahmadinejad of Iran predicted that Israel had “pushed the button of its own destruction.”The AustralianNY TimesThe AustralianThe AustralianNY TimesNational …

North Korea launched six rockets over the Sea of Japan, including a Taepodong-2 intercontinental ballistic missile, which apparently was aborted after just 40 seconds. One thing we have learned, said President George W. Bush, who strongly dislikes North Korea’s Dear Leader Kim Jong Il, “is that the rocket didn’t stay up very long.” The president, who expressed annoyance when a reporter pointed out that Kim Jong Il had on all accounts increased his nuclear potency since Bush took office, claimed that his antimissile system, which has failed repeated tests, had a “reasonable chance” of intercepting the Taepodong.New York TimesIndia tested …

Lost Souls in Hell, 1875. Prime Minister Nuri al-Maliki of Iraq unveiled a 24-point national reconciliation plan designed to end his nation’s civil war, and in Baghdad nearly 100 people were abducted by gunmen dressed as police officers.Islam Online via Google NewsThe Iraqi military recovered the bodies of two kidnapped U.S. soldiers; a spokesman said they had been “tortured in a barbaric fashion.”The New York TimesThe New York TimesIn Baghdad a car bomb detonated next to an ice cream shop, killing at least three people of indeterminate age, and insurgents beheaded two Russian diplomats and shot another.Houston Chronicle via Google …