Wall Street set for rally in wake of fiscal pact

NEW YORK (Reuters) - Wall Street was set to rally on the first trading day of 2013, after lawmakers agreed a deal to avoid massive tax hikes and spending cuts that had threatened to hurt economic growth.

The gains would come after stocks ended 2012 with their strongest day in more than a month, which put the S&P 500 up 13.4 percent for the year, after a flat performance in 2011.

Late on Tuesday, the House of Representatives voted for a bill that will raise taxes on wealthy individuals and families and preserve certain benefits.

The vote averted immediate austerity measures, like tax hikes for almost all U.S. households, although it didn't resolve other political showdowns on the budget due in coming months. Spending cuts of $109 billion in military and domestic programs were only delayed for two months.

"We are looking at a sharply higher open on Wall Street," said Peter Cardillo, chief market analyst for Rockwell Global Capital in New York. "The deal certainly brightens the prospects for economic growth, and traditionally speaking, the first week of the year generally sets the stage for the rest of the year for equities - so this is positive."

"There is a lot of euphoria out there and I expect, for the next day or two, the market will continue on the upside. We will see money re-entering the market," Cardillo said.

S&P 500 futures rose 26.8 points and were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures gained 203 points, and Nasdaq 100 futures added 57.25 points.

The long-awaited U.S. fiscal deal lifted global shares at the start of the new year. The pan-European FTSEurofirst 300 <.fteu3> was up 1.6 percent and the MSCI world index <.miwd00000pus> rose 0.8 percent. The MSCI Asia Pacific ex-Japan index of stocks <.miapj0000pus> surged 2.1 percent. Japanese markets were closed Wednesday for a holiday.

On the macroeconomic front, the Institute for Supply Management's manufacturing sector survey will be released at 10:00 a.m. ET (1500 GMT). A Reuters survey forecasts the main index at 50.3 compared with 49.5 in November.

Also at 10:00 a.m., November construction spending data will be released. A Reuters survey forecasts a 0.6 percent rise in construction spending, versus 1.4 percent in the prior month.

On the last day of trading in 2012, the Dow Jones industrial average <.dji> gained 166.03 points, or 1.28 percent, to close at 13,104.14. The Standard & Poor's 500 Index <.spx> gained 23.76 points, or 1.69 percent, to finish at 1,426.19. The Nasdaq Composite Index <.ixic> gained 59.20 points, or 2.00 percent, to close at 3,019.51.

In 2012, the Dow advanced 7.3 percent, while the Nasdaq climbed 15.9 percent.

(Editing by Bernadette Baum)

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IHT Rendezvous: Hoping to End Decades-long Kurdish Conflict, Turkey Calls on Archenemy

LONDON — Turkish intelligence agents have been making the short hop from Istanbul across the Sea of Marmara to the prison Island of Imrali in recent weeks for talks with a jailed Kurdish separatist leader who was once Turkey’s most wanted man.

Abdullah Ocalan, founder of the Kurdistan Workers’ Party, the P.K.K., has been languishing on Imrali since he was captured in Nairobi, Kenya in 1999 while on the run. He is serving a life term after a death sentence was commuted.

Now the Turkish government wants his help to end a resurgent war with P.K.K. rebels that has claimed around 900 lives in the last year and a half.

Recep Tayyip Erdogan, the Turkish prime minister, revealed the dialog last week when he told state-run TRT television, “I cannot hold such meetings myself as a politician but the state has agents and they do.”

In an acknowledgement that the latest escalation in a three-decade battle against the Kurdish insurgents was probably unwinnable, Yalcin Akdogan, a senior adviser to Mr. Erdogan, said this week that the talks were aimed at persuading the P.K.K. to disarm.

“The government supports any dialog to this end that could result in a halt to violence,” Mr. Akdogan said in a television interview. “You cannot get results and abolish an organization only with armed struggle.”

The strategy of seeking a deal with the P.K.K. has implications for Turkey’s policy in neighboring Syria, where Kurdish militants linked to the organization have taken over territory vacated by retreating government forces.

Turkey “fears that an autonomous Kurdish region in Syria would become a haven for Kurdish militants to carry out cross-border attacks in the Kurdish areas in southeastern Turkey,” my colleague Tim Arango wrote recently in a report from the border region.

Tensions over Syria and the Kurdish issue have also led to a souring of Turkey’s relations with Iran and the Iraqi government in Baghdad, as Ankara struggled to cope with the aftermath of the so-called Arab Spring.

There is a question mark over how much authority the jailed Mr. Ocalan has over the P.K.K. leadership, which is based in the Qandil mountains in the Kurdish region of northern Iraq. “He remains a figure of symbolic importance,” Mr. Akdogan said of the P.K.K. founder. “But we still have to wait and see how Qandil will react.”

Mr. Ocalan’s capture in 1999 was a cause of national celebration among Turks after the worst years of a war that has cost 40,000 lives, including those of Turkish and Kurdish civilians. The P.K.K. is regarded as a terrorist organization by, among others, the United States and the European Union.

However, the Turkish authorities have not shrunk from dealing with Mr. Ocalan in the past to intervene in Kurdish matters.

In November, he saved the authorities from an escalating crisis that threatened to worsen tensions with the Kurds by calling on hundreds of his imprisoned supporters to halt a two-month hunger strike. The protesters had been demanding an end to Mr. Ocalan’s isolation and improved rights for Turkey’s Kurdish minority, which makes up 20 percent of its population.

Andrew Finkel wrote in the IHT’s Global Views opinion section that the intervention signaled the resumption of Mr. Ocalan’s career.

Mr. Ocalan is now reportedly demanding direct contact with the P.K.K.’s leadership and improved prison conditions as the price for his cooperation in persuading the militants to lay down their arms.

Some observers have cast doubt on the government’s strategy of dealing with Mr. Ocalan while failing to carry out reforms in favor of the country’s Kurdish minority.

David Rohde wrote in a Rendezvous article at the weekend that more than 10,000 Kurds were imprisoned in Turkey on various terrorism charges.

According to Hugh Pope, project director of the International Crisis Group in Turkey, the government of Mr. Erdogan is putting the cart before the horse. “They need to find a Kurdish settlement first before cutting a deal with the P.K.K.,” he told Rendezvous from Istanbul.

That would include instituting promised reforms that would give equality to Turkey’s Kurdish citizens, including the right to a Kurdish-language education.

“The P.K.K. wants to do a deal and obviously Ocalan is desperate to get out of jail,” Mr. Pope said. “He may be an essential ingredient but he’s not the magic key.”

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Your Snapchats aren’t safe: How to secretly save videos from Snapchat or Facebook’s ‘Poke’

Argue though its executives might, Snapchat is good for two things: sending photos and videos of yourself making stupid faces, and sending photos and videos of yourself naked. The latter, of course, is the more compelling function since that is exactly what the app was designed for. When users send pictures or videos, the recipient can only view them for a set amount of time before they “self-destruct.” Yes, a recipient can take a screenshot but the sender is automatically alerted when that occurs — then, as the saying goes, fool me once… As it turns out, however, Snapchat users (and users of “Poke,” Facebook’s (FB) Snapchat ripoff) can easily save photos and full-length videos received through the service without the sender ever knowing.

[More from BGR: Five tech resolutions for 2013]

As recently relayed by BuzzFeed’s Katie Notopoulos, saving photos and videos from Snapchat or Poke is as easy as connecting a phone to a computer and opening a file browser. The file browser is free and the “trick” requires no jailbreak or any other kind of hack.

[More from BGR: Can Samsung survive without Android?]

Start by leaving the photos and videos you receive in Snapchat or Poke unopened; as soon as a file is viewed, the countdown to its deletion begins.

Then simply connect to a computer and open a free iPhone file explorer like i-FunBox. Open the “User Applications” folder, navigate to the “Snapchat” entry and voilà, all of the photos and videos you have received and not yet opened are available to be copied to your computer’s hard drive.

Then go back and view them normally in the app and the sender will be none the wiser.

The file path is a bit different for Facebook’s Poke app but the end result is the same.

This article was originally published by BGR

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Betty White Wants to Share Kim Kardashian's Boyfriend - in New Clip

TV Watch
People Exclusive

By Maggie Coughlan

01/02/2013 at 08:50 AM EST

Kim Kardashian (left) and Betty White

Trae Patton/NBC

Talk about an odd couple.

Kim Kardashian joins Betty White for the veteran actress's NBC series Betty White's Off Their Rockers – premiering Jan. 8 at 8/7 C – for a hilarious comedy bit.

In the routine, while researching her family tree White, 90, discovers that she and Kardashian, 32, are actually related.

"You know what that means, I'm just one step away from your boyfriend," White declares. "You Kardashians share everything, right?"

But Kardashian is anything but amused. "Back off Betty," she replies, disapprovingly.

"Ooh, a family feud! I just love being a Kardashian," White says with a sly giggle.

For even more giggles, see the clip below.

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Brain image study: Fructose may spur overeating

This is your brain on sugar — for real. Scientists have used imaging tests to show for the first time that fructose, a sugar that saturates the American diet, can trigger brain changes that may lead to overeating.

After drinking a fructose beverage, the brain doesn't register the feeling of being full as it does when simple glucose is consumed, researchers found.

It's a small study and does not prove that fructose or its relative, high-fructose corn syrup, can cause obesity, but experts say it adds evidence they may play a role. These sugars often are added to processed foods and beverages, and consumption has risen dramatically since the 1970s along with obesity. A third of U.S. children and teens and more than two-thirds of adults are obese or overweight.

All sugars are not equal — even though they contain the same amount of calories — because they are metabolized differently in the body. Table sugar is sucrose, which is half fructose, half glucose. High-fructose corn syrup is 55 percent fructose and 45 percent glucose. Some nutrition experts say this sweetener may pose special risks, but others and the industry reject that claim. And doctors say we eat too much sugar in all forms.

For the study, scientists used magnetic resonance imaging, or MRI, scans to track blood flow in the brain in 20 young, normal-weight people before and after they had drinks containing glucose or fructose in two sessions several weeks apart.

Scans showed that drinking glucose "turns off or suppresses the activity of areas of the brain that are critical for reward and desire for food," said one study leader, Yale University endocrinologist Dr. Robert Sherwin. With fructose, "we don't see those changes," he said. "As a result, the desire to eat continues — it isn't turned off."

What's convincing, said Dr. Jonathan Purnell, an endocrinologist at Oregon Health & Science University, is that the imaging results mirrored how hungry the people said they felt, as well as what earlier studies found in animals.

"It implies that fructose, at least with regards to promoting food intake and weight gain, is a bad actor compared to glucose," said Purnell. He wrote a commentary that appears with the federally funded study in Wednesday's Journal of the American Medical Association.

Researchers now are testing obese people to see if they react the same way to fructose and glucose as the normal-weight people in this study did.

What to do? Cook more at home and limit processed foods containing fructose and high-fructose corn syrup, Purnell suggested. "Try to avoid the sugar-sweetened beverages. It doesn't mean you can't ever have them," but control their size and how often they are consumed, he said.

A second study in the journal suggests that only severe obesity carries a high death risk — and that a few extra pounds might even provide a survival advantage. However, independent experts say the methods are too flawed to make those claims.

The study comes from a federal researcher who drew controversy in 2005 with a report that found thin and normal-weight people had a slightly higher risk of death than those who were overweight. Many experts criticized that work, saying the researcher — Katherine Flegal of the Centers for Disease Control and Prevention — painted a misleading picture by including smokers and people with health problems ranging from cancer to heart disease. Those people tend to weigh less and therefore make pudgy people look healthy by comparison.

Flegal's new analysis bolsters her original one, by assessing nearly 100 other studies covering almost 2.9 million people around the world. She again concludes that very obese people had the highest risk of death but that overweight people had a 6 percent lower mortality rate than thinner people. She also concludes that mildly obese people had a death risk similar to that of normal-weight people.

Critics again have focused on her methods. This time, she included people too thin to fit what some consider to be normal weight, which could have taken in people emaciated by cancer or other diseases, as well as smokers with elevated risks of heart disease and cancer.

"Some portion of those thin people are actually sick, and sick people tend to die sooner," said Donald Berry, a biostatistician at the University of Texas MD Anderson Cancer Center in Houston.

The problems created by the study's inclusion of smokers and people with pre-existing illness "cannot be ignored," said Susan Gapstur, vice president of epidemiology for the American Cancer Society.

A third critic, Dr. Walter Willett of the Harvard School of Public Health, was blunter: "This is an even greater pile of rubbish" than the 2005 study, he said. Willett and others have done research since the 2005 study that found higher death risks from being overweight or obese.

Flegal defended her work. She noted that she used standard categories for weight classes. She said statistical adjustments were made for smokers, who were included to give a more real-world sample. She also said study participants were not in hospitals or hospices, making it unlikely that large numbers of sick people skewed the results.

"We still have to learn about obesity, including how best to measure it," Flegal's boss, CDC Director Dr. Thomas Frieden, said in a written statement. "However, it's clear that being obese is not healthy - it increases the risk of diabetes, heart disease, cancer, and many other health problems. Small, sustainable increases in physical activity and improvements in nutrition can lead to significant health improvements."

___

Online:

Obesity info: http://www.cdc.gov/obesity/data/trends.html

___

Marilynn Marchione can be followed at http://twitter.com/MMarchioneAP

Mike Stobbe can be followed at http://twitter.com/MikeStobbe

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Senate approves "fiscal cliff" deal, crisis eased

WASHINGTON (Reuters) - The Senate moved the U.S. economy back from the edge of a "fiscal cliff" on Tuesday, voting to avoid imminent tax hikes and spending cuts in a bipartisan deal that could still face stiff challenges in the House of Representatives.

In a rare New Year's session at around 2 a.m. EST (0700 GMT), senators voted 89-8 to raise some taxes on the wealthy while making permanent low tax rates on the middle class that have been in place for a decade.

But the measure did little to rein in huge annual budget deficits that have helped push the U.S. debt to $16.4 trillion.

The agreement came too late for Congress to meet its own deadline of New Year's Eve for passing laws to halt $600 billion in tax hikes and spending cuts which strictly speaking came into force on Tuesday.

But with the New Year's Day holiday, there was no real world impact and Congress still had time to draw up legislation, approve it and backdate it to avoid the harsh fiscal measures.

That will need the backing of the House where many of the Republicans who control the chamber complain that President Barack Obama has shown little interest in cutting government spending and is too concerned with raising taxes.

All eyes are now on the House which is to hold a session on Tuesday starting at noon (1700 GMT).

Obama called for the House to act quickly and follow the Senate's lead.

"While neither Democrats nor Republicans got everything they wanted, this agreement is the right thing to do for our country and the House should pass it without delay," he said in a statement.

"There's more work to do to reduce our deficits, and I'm willing to do it. But tonight's agreement ensures that, going forward, we will continue to reduce the deficit through a combination of new spending cuts and new revenues from the wealthiest Americans," Obama said.

Members were thankful that financial markets were closed, giving them a second chance to return to try to head off the fiscal cliff.

But if lawmakers cannot pass legislation in the coming days, markets are likely to turn sour. The U.S. economy, still recovering from the 2008/2009 downturn, could stall again if Congress fails to fix the budget mess.

"If we do nothing, the threat of a recession is very real. Passing this agreement does not mean negotiations halt, far from it. We can all agree there is more work to be done," Majority Leader Harry Reid, a Democrat, told the Senate floor.

A new, informal deadline for Congress to legislate is now Wednesday when the current body expires and it is replaced by a new Congress chosen at last November's election.

The Senate bill, worked out after long negotiations on New Year's Eve between Vice President Joe Biden and Senate Republican Minority Leader Mitch McConnell, also postpones for two months a $109 billion "sequester" of sweeping spending cuts on military and domestic programs.

It extends unemployment insurance to 2 million people for a year and makes permanent the alternative minimum tax "patch" that was set to expire, protecting middle-income Americans from being taxed as if they were rich.

'IMPERFECT SOLUTION'

The tax hikes do not sit easy with Republicans but conservative senators held their noses and voted to raise rates for the rich because not to do so would have meant increases for almost all working Americans.

"It took an imperfect solution to prevent our constituents from a very real financial pain, but in my view, it was worth the effort," McConnell said.

House Speaker John Boehner - the top Republican in Congress - said the House would consider the Senate deal. But he left open the possibility of the House amending the Senate bill, which would spark another round of legislating.

"The House will honor its commitment to consider the Senate agreement if it is passed. Decisions about whether the House will seek to accept or promptly amend the measure will not be made until House members ... have been able to review the legislation," Boehner and other House Republican leaders said in a statement.

Boehner has struggled for two years to get control over a group of several dozen Tea Party fiscal conservatives in his caucus who strongly oppose tax increases and demand that he force Obama to make savings in the Medicare and Social Security healthcare and retirement programs.

A campaign-style event held by Obama in the White House as negotiations with Senate leaders were taking place on Monday may have made it more difficult for Republicans to back the deal. In remarks to a group of supporters that resembled a victory lap, the president noted that his rivals were coming around to his way of seeing things.

"Keep in mind that just last month Republicans in Congress said they would never agree to raise tax rates on the wealthiest Americans. Obviously, the agreement that's currently being discussed would raise those rates and raise them permanently," he said to applause before the Senate deal was sealed.

Obama's words and tone annoyed Republican lawmakers who seemed to feel that the Democrat was gloating.

"That's not the way presidents should lead," said Republican Senator John McCain, Obama's rival in the 2008 election.

A deal with the House on Tuesday, while uncertain, would not mark the end of congressional budget fights. The "sequester" spending cuts will come up again in February as will the contentious "debt ceiling," which caps how much debt the federal government can hold.

Republicans may see those two issues as their best chance to try to rein in government spending and clip Obama's wings at the start of his second term.

(Additional reporting by Richard Cowan, Mark Felsenthal, Rachelle Younglai, Kim Dixon and Jeff Mason; Writing by Alistair Bell; Editing by Eric Walsh)

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In Hong Kong, Rival Protests Are Divided Over LeaderIn Hong Kong, Rival Protests Are Divided Over Leader

HONG KONG — Thousands of demonstrators in rival marches crowded through Hong Kong’s main shopping district on Tuesday to praise or condemn the city’s chief executive, who appears to retain the confidence of leaders in Beijing despite a series of controversies at home.

The New Year’s Day marches underlined deep political divisions in Hong Kong, a semiautonomous territory that Britain returned to Chinese rule in 1997.

Critics of the chief executive, Leung Chun-ying, accuse him of misleading the public on a controversial real estate issue, and of being a puppet installed by Beijing. Many of his critics also favor greater democracy for Hong Kong, where the chief executive is now chosen by a 1,200-member panel packed with Beijing loyalists; the general public elects half the legislature, while the other half is chosen by business leaders and other groups that also tend to follow Beijing’s wishes.

Mr. Leung’s backers, mainly organized by groups with lavish financial support from Beijing, contend that he is beginning to address deep-seated social issues here. They also tend to suggest that democracy is a Western concept that may not be compatible with local culture or with rapid economic development.

Supporters of Mr. Leung roughed up two local journalists at a separate rally on Sunday; many Beijing loyalists accuse Hong Kong journalists of being biased in favor of democracy. But the marches on Tuesday were largely peaceful. Organizers of the follow-up march in favor of Mr. Leung on Tuesday estimated their crowd at 60,000 people, while the police put the number at only 8,000. Demonstrators seeking Mr. Leung’s resignation were more numerous, with organizers estimating their ranks at 130,000, while the police estimated 17,000.

Mr. Leung, who took office as chief executive on July 1, has faced heavy criticism for concealing during last winter’s election campaign that he had secretly expanded his $64 million home without receiving government planning permission or paying real estate fees due on the expansion.

Mr. Leung has been widely accused of hypocrisy because he won the election partly by criticizing his opponent, Henry Tang, for the unauthorized construction of a huge basement under a villa owned by Mr. Tang’s wife. That construction was also done without government planning permission, which is difficult to obtain, and without making a large payment to the government, which owns virtually all the land in Hong Kong and collects hefty lease payments based mainly on the square footage of developments.

Mr. Leung apologized this autumn for concealing his construction — he even built a false wall to hide his extension right before running for the territory’s top office. But he pointed out that he had not addressed his own compliance with Hong Kong real estate laws during the campaign.

“In fact, in my memory, I did not say I had no illegal structure,” he told the legislature.

Many Hong Kong residents blame growing immigration and tourism from mainland China for driving housing prices to unaffordable levels, causing overcrowding in local schools and making it hard for young people to find jobs. Mr. Leung has addressed these issues in his first six months in office by imposing steep taxes this autumn on short-term real estate investments by anyone who is not a permanent resident. He has also banned local hospitals, starting on New Year’s Day, from scheduling any more births for mainland mothers.

Continued support for Mr. Leung from Beijing makes it unlikely that he will be forced to resign. When the legislature took up a no-confidence measure three weeks ago, a majority of the lawmakers elected by the general public voted against Mr. Leung, but a majority of lawmakers representing business leaders and other social groups supported him. To pass, a majority of both groups was required.

In separate meetings with Mr. Leung nearly two weeks ago in Beijing, President Hu Jintao of China and Xi Jinping, who became the general secretary of the ruling Communist Party in November and is slated to become China’s next president in March, each said separately that they “affirm” support for Mr. Leung and his administration.

“You have a heavy workload and it is exhausting,” Mr. Xi said. “The central government affirms your work.”

Sprinkled among the protesters against Mr. Leung were a few people carrying the colonial Hong Kong flag that flew over the city during British rule. Beijing officials have asked Hong Kong residents not to display the flag, which they regard as a symbol of past foreign domination and humiliation of China.

Steveny Chan, a young woman who identified herself only as an office worker and carried a roughly 3-foot by 2-foot colonial flag, said that she did not favor the return of Hong Kong to British rule. She said that she was displaying the flag as a nostalgic symbol of a time when the Hong Kong economy seemed to offer more opportunities for young people, and when the people of Hong Kong seemed to enjoy growing autonomy to decide their own fates.

“We’re missing the golden old days of Hong Kong,” she said.

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Olympics, elections and horsing around in odd 2012

LONDON (Reuters) – Presidential preening, golden Olympic gaffes, a royal windfall for a skydiving British queen on her diamond jubilee and the endless end of days marked the odd stories in 2012 which pranced across the news in Gangnam Style.

The year opened with a tale that flocks of magpies and bears had been spotted in mourning for North Korea‘s “Dear Leader”, Kim Jong-il who died in December 2011 and was succeeded by his 20-something son Kim Jong-un.

Winter weather was so cold in Brussels that the Manneken-Pis, a bronze statue of a young boy urinating had to stop peeing because of sub-zero temperatures.

There was slightly warming news about Mondays in Germany, where crematoriums are struggling to adapt to an increasingly obese population and a boom in extra-large coffins.

“We burn particularly large coffins on Monday mornings when the ovens are cold,” one crematorium said.

In March Polish media reported that kite surfer Jan Lisewski fought off repeated shark attacks and overcame thirst and exhaustion in a two-day battle of survival on the Red Sea with just his trusty knife as protection.

“I was stabbing them in the eyes, the nose and gills.”

In other animal news, dairy cows across the world mourned the loss of “Jocko”, the world’s third most-potent breeding bull and Yvonne the German cow who evaded helicopter searches and dodged hunters landed a film deal: “Cow on the Run”.

A Nepali man who was bitten by a cobra snake bit it back and killed the reptile after it attacked him in his rice paddy.

“I could have killed it with a stick but bit it with my teeth instead because I was angry,” Mohamed Salmo Miya said.

A scathing resignation letter of a Goldman Sachs executive published in the New York Times inspired a sheaf of online spoofs, including Star Wars villain Darth Vader.

“The Empire today has become too much about shortcuts and not enough about remote strangulation. It just doesn’t feel right to me anymore,” Vader wrote in a published letter.

Austerity in Europe saw a once-thriving Greek sex industry become the latest victim of the country’s debt crisis with Greeks spending less on erotic toys, pornography and lingerie.

But lust appeared to be in the rudest of health elsewhere.

Turkish emergency workers rescued an inflatable sex doll floating in the Black Sea and a German disc jockey vowed to press charges against a woman who locked him in her apartment and ravaged him for hours until he rang the police.

“She was sex mad and there was no way out of the flat,” Dieter S. told police.

@ROYALFETUS

Britain’s Queen Elizabeth celebrated her 60th year on the throne with Diamond Jubilee celebrations that saw a 1,000-ship rain-sodden flotilla sail down the River Thames, a massive party in front of Buckingham Palace, street parties across the country and a spoof incarnation of her majesty on Twitter.

“OK, fire up the Bentley. Let’s rock,” tweeted “Elizabeth Windsor“, the comic online alter ego of the British monarch in a typical tweet from the spoof Twitter account @Queen_UK, a virtual monarch with a razor-sharp wit and a penchant for gin.

And Twitter positively exploded with spoof royal accounts later in the year when Elizabeth’s grandson William and his wife Kate announced she was pregnant with a future monarch.

“I may not have bones yet, but I’m already more important than everyone reading this,” was the tweet from @RoyalFetus.

Leadership and change was a theme which ran through a year in which socialist Francois Hollande defeated incumbent Nicolas Sarkozy and Mimi the clown to become French president, Vladimir Putin was elected Russian president again and U.S. President Barack Obama won re-election over Republican Mitt Romney.

Amid the tight election race, Obama met a gaffe-prone Romney for an exchange at a charity dinner ahead of the November poll, where America’s first black president poked fun at Hollywood actor Clint Eastwood for lecturing an empty chair as if it were Obama during the Republican convention.

“Please take your seats,” Obama told the crowd, “or else Clint Eastwood will yell at them.”

“THE MODFATHER”

Sporting news was dominated by the London Olympics during the summer, where the opening ceremony included a vignette of Queen Elizabeth being escorted by James Bond before apparently skydiving into the Olympic stadium for her arrival.

“Good evening Mr. Bond,” was her only line.

Olympic embarrassments were few, but they began early with organizers forced into apologies for displaying the South Korean flag on a video screen for North Korea‘s women’s soccer team.

British cycling sensation Bradley “the Modfather” Wiggins became the first Briton to win the Tour de France, sparking a craze among fans for cutout cardboard sideburns modeled on his own and shouting “here Wiggo” as he raced to Olympic gold.

London’s eccentric and loquacious Mayor Boris Johnson fell rather awkwardly silent when he got stuck dangling from a zip wire, waving two Union flags in drizzling rain.

Olympic chiefs urged youthful athletes to drink “sensibly”.

But there was anything but restraint for Jamaican sprinter Usain Bolt, who declared an early night at one point only to be photographed later with three members of the Swedish women’s handball team. Early one Sunday morning Bolt also dazzled dancers at a London night club with a turn in the DJ booth.

“I am a legend,” Bolt shouted out to a packed dance floor from the decks with his arms raised in the air.

Towards the close of the year, tens of thousands of mystics, hippies and tourists celebrated in the shadow of ancient Maya pyramids in southeastern Mexico as the Earth survived a day billed by doomsday theorists as the end of the world.

“It’s pure Hollywood,” said Luis Mis Rodriguez, 45, a Maya selling obsidian figurines and souvenirs.

Finally, a chubby, rapping singer with slicked-back hair and a tacky suit became the latest musical sensation to burst upon the world from South Korea, via a YouTube music video that has been seen more than a billion times.

Decked out in a bow tie and suit jackets varying from pink to baby blue, as well as a towel for one sequence set in a sauna, Psy busts funky moves based on horse-riding in venues ranging from playgrounds to subways.

The video by Psy has been emulated by everyone from Chinese dissident artist Ai Weiwei to students at Britain’s elite Eton College, gurning politicians, spotty teens and embarrassing dads worldwide.

“My goal in this music video was to look uncool until the end. I achieved it,” Psy told Reuters.

(Reporting by Paul Casciato; editing by Mike Collett-White)

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Eric Prydz Picks a New Year's Eve Playlist

By Dahvi Shira

12/31/2012 at 06:50 PM EST

Unfortunately not everyone can be in Las Vegas when the ball drops this year, but Eric Prydz is bringing the party to PEOPLE.com readers in advance.

The DJ and producer, 36 – best known for his 2004 hit single, "Call on Me" – is playing a three-hour extended set at Surrender Nightclub on Monday, and he's sharing the tracks he's most excited to spin, including songs from his album, Eric Prydz Presents Pryda.

"I love to play on New Year's Eve because it has that special tension in the air," Prydz says. "People are so excited about the new year coming, leaving the old behind and starting fresh. It's also the perfect excuse to blow off some steam after that long Christmas with family. Let's make New Year's Eve 2013 one to remember!"

Recently scoring a Grammy nomination for his remix of M83's "Midnight City," Prydz, who is relocating to Los Angeles, already predicts 2013 "is going to be an amazing year."

As for his evening playlist, he plans to "blend a lot of the highlights from the past year with classics and brand new music set to blow up in 2013."

Check out part of his planned set below:

• Jeremy Olander – "Let Me Feel"
"This tune has spring/summer of 2013 written all over it. It's such a feel good track!"
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• Fehrplay – "I Can't Stop It"
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• Rone – "Parade (Dominik Eulberg Remix)"
"Every now and then there is a track that comes along and blows your mind. This is one of those tracks. Nine minutes of pure emotion."
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• Eric Prydz – "Every Day"
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Clinton receiving blood thinners to dissolve clot

WASHINGTON (AP) — Doctors treating Secretary of State Hillary Rodham Clinton for a blood clot in her head said blood thinners are being used to dissolve the clot and they are confident she will make a full recovery.

Clinton didn't suffer a stroke or neurological damage from the clot that formed after she suffered a concussion during a fainting spell at her home in early December, doctors said in a statement Monday.

Clinton, 65, was admitted to New York-Presbyterian Hospital on Sunday when the clot turned up on a follow-up exam on the concussion, Clinton spokesman Phillipe Reines said.

The clot is located in the vein in the space between the brain and the skull behind the right ear. She will be released once the medication dose for the blood thinners has been established, the doctors said.

In their statement, Dr. Lisa Bardack of the Mount Kisco Medical Group and Dr. Gigi El-Bayoumi of George Washington University said Clinton was making excellent progress and was in good spirits.

Clinton's complication "certainly isn't the most common thing to happen after a concussion" and is one of the few types of blood clots in the skull or head that are treated with blood thinners, said Dr. Larry Goldstein, a neurologist who is director of Duke University's stroke center. He is not involved in Clinton's care.

The area where Clinton's clot developed is "a drainage channel, the equivalent of a big vein inside the skull. It's how the blood gets back to the heart," Goldstein said.

Blood thinners usually are enough to treat the clot and it should have no long-term consequences if her doctors are saying she has suffered no neurological damage from it, Goldstein said.

Clinton returned to the U.S. from a trip to Europe, then fell ill with a stomach virus in early December that left her severely dehydrated and forced her to cancel a trip to North Africa and the Middle East. Until then, she had canceled only two scheduled overseas trips, one to Europe after breaking her elbow in June 2009 and one to Asia after the February 2010 earthquake in Haiti.

Her condition worsened when she fainted, fell and suffered a concussion while at home alone in mid-December as she recovered from the virus. It was announced Dec. 13.

This isn't the first time Clinton has suffered a blood clot. In 1998, midway through her husband's second term as president, Clinton was in New York fundraising for the midterm elections when a swollen right foot led her doctor to diagnose a clot in her knee requiring immediate treatment.

Clinton had planned to step down as secretary of state at the beginning of President Barack Obama's second term. Whether she will return to work before she resigns remained a question.

Democrats are privately if not publicly speculating: How might her illness affect a decision about running for president in 2016?

After decades in politics, Clinton says she plans to spend the next year resting. She has long insisted she had no intention of mounting a second campaign for the White House four years from now. But the door is not entirely closed, and she would almost certainly emerge as the Democrat to beat if she decided to give in to calls by Democratic fans and run again.

Her age — and thereby health — would probably be a factor under consideration, given that Clinton would be 69 when sworn in, if she were elected in 2016. That might become even more of an issue in the early jockeying for 2016 if what started as a bad stomach bug becomes a prolonged, public bout with more serious infirmity.

Not that Democrats are willing to talk openly about the political implications of a long illness, choosing to keep any discussions about her condition behind closed doors. Publicly, Democrats reject the notion that a blood clot could hinder her political prospects.

"Some of those concerns could be borderline sexist," said Basil Smikle, a Democratic strategist who worked for Clinton when she was a senator. "Dick Cheney had significant heart problems when he was vice president, and people joked about it. He took the time he needed to get better, and it wasn't a problem."

It isn't uncommon for presidential candidates' health — and age — to be an issue. Both in 2000 and 2008, Sen. John McCain, R-Ariz., had to rebut concerns he was too old to be commander in chief or that his skin cancer could resurface.

Two decades after Clinton became the first lady, signs of her popularity — and her political strength — are ubiquitous.

Obama had barely declared victory in November when Democrats started zealously plugging Clinton as their strongest White House contender four years from now, should she choose to take that leap.

"Wouldn't that be exciting?" House Democratic leader Nancy Pelosi declared in December. "I hope she goes. Why wouldn't she?"

Even Republicans concede that were she to run, Clinton would be a force to be reckoned with.

"Trying to win that will be truly the Super Bowl," Newt Gingrich, the former House Speaker and 2012 GOP presidential candidate, said in December. "The Republican Party today is incapable of competing at that level."

Americans admire Clinton more than any other woman in the world, according to a Gallup poll released Monday — the 17th time in 20 years that Clinton has claimed that title. And a recent ABC News/Washington Post poll found that 57 percent of Americans would support Clinton as a candidate for president in 2016, with just 37 percent opposed. Websites have already cropped up hawking "Clinton 2016" mugs and tote bags.

Beyond talk of future politics, Clinton's three-week absence from the State Department has raised eyebrows among some conservative commentators who questioned the seriousness of her ailment after she canceled planned Dec. 20 testimony before Congress on the deadly attack on the U.S. diplomatic mission in Benghazi, Libya.

Clinton had been due to discuss with lawmakers a scathing report she had commissioned on the attack. It found serious failures of leadership and management in two State Department bureaus were to blame for insufficient security at the facility. Clinton took responsibility for the incident before the report was released, but she was not blamed. Four officials cited in the report have either resigned or been reassigned.

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Associated Press writer Ken Thomas in Washington and AP Chief Medical Writer Marilynn Marchione in Milwaukee contributed to this report.

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