1 of 6. Police stand near a crime scene in the Swiss village of Daillon near Sion January 3, 2013.

DAILLON, Switzerland | Thu Jan 3, 2013 7:28am EST

DAILLON, Switzerland (Reuters) - Three women were killed and two men were wounded late on Wednesday when a gunman opened fire in the Swiss village of Daillon, Swiss police and prosecutors said on Thursday.

The 33-year-old gunman, who has not been named, threatened police when they tried to arrest him and was shot in the chest before being arrested and taken to hospital, police in the Swiss canton of Valais said. No police officers were wounded.

Gun ownership is widespread in Switzerland and voters rejected a proposal in February 2011 to tighten the country's liberal fire arms laws.

The women killed in Daillon were aged 32, 54 and 79. They were all shot at least twice, in the head and chest. The youngest was married to one of the injured men and they had young children together, regional public prosecutor Catherine Seppey told a news conference.

The injured men were aged 33 and 63.

The gunman was a local resident who had been in psychiatric care in 2005 and was unemployed and living on welfare benefits, police said. His only previous conviction was for marijuana use.

He used at least two firearms - an old Swiss army carbine and a rifle capable of firing lead shot - even though his weapons had been seized and destroyed in 2005, and he was not currently listed as having any guns.

He began firing from his apartment, shooting at people in the street and in neighboring buildings, but later came out into the street, police said, adding that he appeared to have fired more than 20 shots.

Swiss website 20minutes.ch quoted villagers as saying the gunman had been drinking heavily. It also said he was armed with an assault rifle, but the public prosecutor did not confirm that information.

The village is close to the town of Sion, the capital of the canton - or region - of Valais.

A shooting in the regional parliament in the canton of Zug in 2001 stirred debate over gun control in Switzerland, where - according to some estimates - at least one in every three of its 8 million inhabitants holds a gun.

Many are stored in people's attics, a legacy of Switzerland's policy of creating a citizen army that can be mobilized quickly to defend its neutrality.

(Writing by Tom Miles; Additional reporting by Emma Farge; Editing by Mohammad Zargham/Ruth Pitchford)

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WASHINGTON | Fri Dec 21, 2012 12:41pm EST

WASHINGTON (Reuters) - State and local government spending grew at a 0.3 percent annual rate in the third quarter, after 11 straight quarters of contraction, the U.S. Commerce Department said on Thursday.

The last time state and local spending expanded was in the third quarter of 2009, at a much more robust rate of 2.2 percent. Then, for nearly three years, spending contracted sharply, with the biggest drop in the first quarter of 2010 at 5.5 percent.

States are pinching pennies, keeping spending growth slow as the economy recovers from the 2007-09 recession and the federal government sends them fewer funds.

"The recent improvement in the national economy has not translated to strong growth in total state expenditures," said the National Association of State Budget Officers (NASBO) in a report also released on Thursday.

Total state spending likely grew only 0.1 percent in fiscal 2012, the lowest level since the group began tracking state spending in 1987, NASBO said. Most states' fiscal years end in June, which means that many have already started fiscal 2013.

The 2007-09 recession caused states' revenues to plunge and, because all states except Vermont must end their fiscal years with balanced budgets, many slashed spending, calling special legislative sessions to make emergency mid-year cuts.

The federal government stepped in to help with the 2009 economic stimulus plan known as the American Recovery and Reinvestment Act (ARRA), which included the largest transfer of federal funds to states in U.S. history.

NASBO said state expenditures grew 3.8 percent in fiscal 2010 and 2.8 percent in fiscal 2011, mostly due to the assistance. By fiscal 2010 federal money made up nearly 35 percent of state spending, compared with 26.3 percent in fiscal 2008.

Now that the burst of stimulus money is over, states must once again shoulder the costs of public programs, even though their revenues are only beginning to return to pre-recession levels. Federal funds likely only represented 31.2 percent of state spending in fiscal 2012 and will continue to shrink, NASBO said.

"State revenues have not increased as fast as ARRA funds have declined, leading to a unique situation in which total state expenditure growth has slowed during the same time that the national economy has been improving," it reported.

Meanwhile, spending demands continue to grow, particularly for the Medicaid healthcare program for the poor that states operate with partial reimbursement from the federal government.

Over the last three years, the portion of state spending going to Medicaid has risen to 23.9 percent from 22.2 percent. Many states worry that Medicaid will eat up their budgets, and leave fewer dollars for other areas.

Spending on education dipped to 19.8 percent in fiscal 2012, the first time on record that the portion has been less than 20 percent, NASBO said.

(Reporting by Lisa Lambert; Editing by Nick Zieminski)

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The Soyuz TMA-07M spacecraft carrying the International Space Station (ISS) crew of U.S. astronaut Thomas Marshburn, Russian cosmonaut Roman Romanenko and Canadian astronaut Chris Hadfield blasts off from its launch pad at the Baikonur cosmodrome December 19, 2012.

CAPE CANAVERAL, Florida | Fri Dec 21, 2012 3:42pm EST

CAPE CANAVERAL, Florida (Reuters) - A Russian Soyuz capsule carrying a multinational crew of three arrived at the International Space Station on Friday, setting the stage for a Canadian for the first time to take command of the orbital research base.

The spacecraft carrying Chris Hadfield from the Canadian Space Agency, NASA's Tom Marshburn and Russian cosmonaut Roman Romanenko blasted off from Kazakhstan's Baikonur Cosmodrome on Wednesday and parked at the station's Rassvet docking module at 9:09 a.m. EST as the ships sailed 255 miles above northern Kazakhstan.

"The Soyuz sleigh has pulled into port at the International Space Station with a holiday gift of three new crewmembers," said NASA mission commentator Rob Navias.

The trio joined station commander Kevin Ford and Russian cosmonauts Oleg Novitskiy and Evgeni Tarelkin, who are two months into a planned six-month mission.

Ford is due to turn over command of the $100 billion research complex, a project of 15 nations, in mid-March to Hadfield, who will become the first Canadian to lead a space expedition.

"This is a big event for me personally," Hadfield said in a preflight interview. "It takes a lot of work, a lot of focus. It's something that I can look back on as an accomplishment and a threshold of my life."

Command of the station, which has been continuously occupied since November 2000, typically rotates between an American and a Russian crewmember.

In 2009, Belgian astronaut Frank De Winne broke that cycle to become the first European Space Agency commander. Japan's Koichi Wakata is training to lead the Expedition 39 crew in March 2014.

All three of the station's new residents have made previous spaceflights. Hadfield, 53, is a veteran of two space shuttle missions. Marshburn, 52, has one previous shuttle mission and Roman Romanenko, 41, a second-generation cosmonaut, served as a flight engineer aboard the space station in 2009.

The station crew will have some time off to celebrate several winter holidays in orbit - Christmas, the New Year and then Orthodox Christmas - before tackling a list of about 150 science experiments and station maintenance, including two spacewalks.

Among the studies will be medical research into how the human cardiovascular system changes in microgravity.

"When you live in an environment like that, the heart actually shrinks. Your blood vessel response changes. It actually sets us up to cardiovascular problems," Hadfield said. "We have a sequence of experiments that's taking blood samples and monitoring our body while we're exercising and doing different things to try and understand what's going on with our cardiovascular system," he said.

The research is expected to help doctors unravel the aging process on Earth, which is similar in many respects to what happens to the human body in weightlessness.

In addition to medical research, the space station serves as a laboratory for fluid physics and other microgravity sciences, a platform for several astronomical observatories and a testbed for robotics and other technologies.

(Edited by David Adams and Leslie Gevirtz)

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A ''for sale'' sign is seen outside a home in New York June 19, 2012. U.S. housing starts fell in May from a 3-1/2 year high, although permits to build new homes rose sharply, suggesting a nascent housing recovery remains on track.

NEW YORK | Tue Oct 9, 2012 9:48am EDT

NEW YORK (Reuters) - The number of U.S. homes that could soon come onto the market fell to the lowest in more than three years as of July as distressed sales offset new delinquencies in an encouraging sign for the housing market, a data analyst firm said on Tuesday.

The pending supply of homes, also known as shadow inventory, fell to 2.3 million units as of the end of July, down 10.2 percent from 2.6 million units a year ago and at the same level as March 2009, CoreLogic said. The July data is the most recent available.

Shadow inventory includes the number of properties that are seriously delinquent or behind with loan payments, in foreclosure or held by lenders and servicers but not currently listed on the market. At the end of July it was equal to about six months' supply, CoreLogic said.

While many economists believe the housing market has finally turned a corner as prices have stabilized, the sector still faces many challenges including the swollen pipeline of foreclosures that need to be absorbed by the market.

A decline in shadow inventory should help the nascent recovery as fewer properties coming onto the market means less downward pressure on prices.

"Broadly speaking, the shadow inventory continued to shrink in July," Anand Nallathambi, chief executive of CoreLogic said in a statement. "This is yet another hopeful sign that the housing market is slowly healing."

Of the properties in shadow inventory, one million homeowners were 90 days or more behind on their mortgage payments, considered to be seriously delinquent. As well, 900,000 homes were in some stage of foreclosure, and 345,000 had already been seized by the banks.

The dollar volume of shadow inventory was $382 billion, down from $397 billion a year ago.

CoreLogic revised its methodology for the report and updated previous figures.

(Reporting by Edward Krudy; Editing by James Dalgleish)

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n" readability="113">(Reuters) - Emerging markets are, in essence, a leveraged way to play the bet that the Federal Reserve will continue its quantitative easing policy - always, everywhere and forever.

Whether that makes them a good investment is an entirely different question.

If you believe that the European Central Bank has taken euro break-up off of the table and that the Fed's pledge to continue buying bonds indefinitely until labor conditions improve will work, then expect fantastic returns from risk assets, and the riskier, as in emerging markets, the better.

There is, however, a more nuanced debate to have. Even if we don't believe that QE3 will "work" by the Fed's own definition, we may well expect that it will have a real and positive impact on asset markets for at least some portion of time. By buying relatively safe mortgage debt - and very possibly more Treasuries later - the Fed will put cash into the pockets of investors, cash which will need to find a home.

Some of it, clearly, has been flowing into emerging markets stocks, bond and currencies.

"Powerful policy puts by the ECB and the Fed have, at least in the near term, broken the stress-intervention cycle which has dominated markets for some time," wrote Piero Ghezzi, head of economics and emerging markets research at Barclays Capital, in a note to clients.

"While the timing of a global growth rebound remains uncertain, the tail risks for investors, in particular those related to the euro area, have been reduced. This improves the outlook for risky assets and should support flows into EM assets," he added.

Emerging markets shares have outperformed the S&P 500 in the past month, rising by more than 4 percent against 2 percent, during which time the ECB has taken action and the Federal Reserve instituted its new policy of open-ended quantitative easing. Over the past year, however, emerging markets have returned less than half the 23 percent gain of the S&P, and over two years the figures are deeply ugly, with emerging markets down by 5 percent against a 25 percent gain in the S&P.

THREE BIG RISKS

There are at least three large risks to a strategy of plunging into emerging markets to play the QE3 momentum trade. First, we don't know how long the positive effects will last. As in recent bouts of QE, the clear pattern has been for an initial quite positive reaction in markets, but an ebbing over months, especially if economic data does not improve. Returns from past easings have been diminishing over time.

It may well be that you get a nice ride upwards, but an equally magnified or greater fall if markets don't keep faith with central banks.

Also, you have risks that are particular to emerging markets if QE does work. It may well drive up commodity prices, as it has in the past. This is especially inflationary in emerging markets where poorer consumers spend a higher percentage of their money on food and energy. That's not just bad news from a human perspective; it may force central banks in emerging markets to keep conditions tight to fight inflation, hurting growth there in comparison to developed markets.

One of the points of QE, though not one officials emphasize, is to help growth in the countries where it is being done by driving down their exchange rates. Between the ECB, Fed, Bank of Japan and other central banks, we have a clear game of competitive currency devaluation going on, and it will only become more intense if economic conditions get worse.

This could be quite bad for emerging markets, which are more dependent on exports and have less well developed domestic consumer economies.

Finally, the big one: the Fed and the ECB may not succeed, and even if they do, politicians here may mess things up by sending the U.S. over the fiscal cliff. The International Monetary Fund warned on Thursday that emerging markets are increasingly vulnerable to another recession in the U.S. or Europe.

"There is no guarantee that the relative calm emerging economies have enjoyed over the past two years will continue," IMF economist Abdul Abiad said at a news conference. "There is a significant risk that advanced economies could experience another downturn, and in such an event, emerging economies and developing economies will end up 'recoupling' with advanced economies."

What the IMF calls 'recoupling' would look very much like a bloodbath in financial markets, with emerging markets seriously underperforming.

None of this eliminates the value of emerging markets as a source of potential diversification, and as a means to investing in economies which should, over time, grow more quickly than developed ones. But rather than a bet on decoupling, playing emerging markets today needs to be recognized as just a QE trade with booster rockets.

(At the time of publication James Saft did not own any direct investments in securities mentioned in this article. He may be an owner indirectly as an investor in a fund. You can email him at jamessaft@jamessaft.com and find more columns atblogs.reuters.com/james-saft)

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Tourists take pictures of a NASA sign at the Kennedy Space Center visitors complex in Cape Canaveral, Florida April 14, 2010.

PASADENA, California (Reuters) - PASADENA | Fri Aug 3, 2012 8:04pm EDT

PASADENA, California (Reuters) - PASADENA Calif. Aug 3 (Reuters) - NASA will pay more than $1 billion over the next 21 months to three companies to develop commercial spaceships capable of flying astronauts to the International Space Station, the agency said Friday.

The lion's share of the $1.1 billion allotted for the next phase of NASA's so-called ?"Commercial Crew" program will be split between Boeing and Space Exploration Technologies, a privately held firm run by Internet entrepreneur Elon Musk.

Boeing will receive $460 million to continue developing its CST-100 capsule, which is intended to fly aboard a United Launch Alliance Atlas 5 rocket. ULA is a partnership of Boeing and Lockheed Martin.

Space Exploration Technologies, or SpaceX, was awarded $440 million to upgrade its Dragon cargo capsule, which flies on the firm's Falcon 9 rocket, to carry people.

In May, a Dragon capsule became the first privately owned spacecraft to reach the station, a $100 billion outpost that flies 240 miles above Earth. The test flight was part of a related NASA program to hire commercial companies to fly cargo to the station.

Privately held Sierra Nevada Corp received a partial award of $212.5 million for work on its Dream Chaser, a winged vehicle that resembles a miniature space shuttle which also launches on an Atlas 5 rocket.

All three firms are prior recipients of NASA space taxi development work. The new awards will more than triple NASA's investments in commercial crew programs, which so far total $365 million.

Unlike previous NASA development programs, costs are shared between the government and its selected partners.

"?The companies also are bringing money to the table. This is a way of allowing the United States to lead in the development of new space systems that are human-capability and then taking those systems for commercial purposes, as well as for NASA purposes in the future," program manager Ed Mango said.

Since the space shuttles were retired last year, NASA is dependent on partners Russia, Europe and Japan to reach the station. Russia will remain the sole entity capable of flying crew until U.S. companies develop systems, which NASA hopes will be within five years.

Shut out of the competition was Alliant Techsystems which hoped to parlay an ongoing unfunded NASA partnership agreement into a paying contract.

Amazon.com founder Jeff Bezos's startup Blue Origin, which won $25.7 million during two predecessor programs, did not bid for the integrated design contracts awarded Friday.

Three other firms - Space Operations, American Aerospace and Space Design - submitted proposals but were eliminated for not meeting requirements, NASA's associate administrator for space operations Bill Gerstenmaier said during a conference call with reporters.

(Irene.Klotz@thomsonreuters.com)

(Editing by Vicki Allen)

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