The Boy Genius Report: Microsoft is blowing it and RIM could too

Who would have thought a couple of years ago that Research In Motion (RIMM) would be on the ropes and Microsoft (MSFT) could be getting close? Well, me… but not many others. Microsoft’s latest strategy of trying to make a no compromise tablet has resulted in, you guessed it, compromise. It’s not as polished as an iPad, it’s more limited in almost every possible way, it’s slow, clunky, unresponsive at times, offers a worse display, weighs more, and is thicker. Plus it costs over $ 100 more when you factor in a Touch Cover or Type Cover keyboard. Plus, you can’t even run Windows applications even though you get the actual Windows desktop.

The best part is the Surface Pro. An even more expensive version of the Surface, an even thicker version of the Surface, and an even heavier version of the Surface, and you get a fan to cool your heating tablet when you’re doing your Excel speadsheets or when Outlook keeps freezing — oh my god why does it freeze so much when you’re typing — and you get half the battery life of the current Surface model.

There’s a very big issue with Microsoft’s strategy of no compromise, because time and time again this company fails to realize that the reason Apple (AAPL) is winning is because Apple choses to compromise.

Apple chooses to throw out the USB port, the DVD drive, the kickstand, the fan, the Intel processor. Apple understands that laptops are still useful but at this point in the game, the only use for a multitouch laptop should be in the trackpad. Microsoft is trying to introduce the Surface Pro as your new laptop, except it doesn’t work well is a variety of situations, especially on your lap. Plus, consumers don’t care, and with enterprises and large companies (and small companies) not rushing out to buy brand new computers or brand new software licenses for their employees and workstations due to cost, and the fact that more and more employees are bringing in their own laptops and also asking for Macs, Microsoft has a tremendous problem.

Compounding Windows 8′s failure is the fact that Microsoft is still not prepared for the consumerization of the enterprise world, Microsoft’s bread and butter, and the reason why Microsoft has $ 60 billion in cash. As Windows licenses erode and Office sales slow, Microsoft isn’t going to have another hugely profitable business to rely on — that’s why this is so scary.

Switching to RIM, the company is actually doing a lot of things right in my book. I respect that everyone there has been huddled up, focused on a single product and operating system and put all of their time into getting it as right as they can. Whether that means anything at all, we’ll soon see; RIM has probably been one of the worst players in the mobile space as far as execution is concerned but Thorsten Heins seems to have a better grasp on where the company can take advantage in different markets and at what price point, though RIM’s market share is declining so rapidly that not even BrickBreaker can save the company there.

I have two concerns from a very high level (in-depth thoughts at a later date) about BlackBerry 10 and the devices RIM is introducing on the hardware front. First off, going with a touch only phone first sends the wrong message to me. What is RIM’s biggest strength? Some would say email, some would say security, most would say the keyboard. Introducing a brand new operating system, with a brand new smartphone that doesn’t feature RIM’s fantastic keyboard feels like a marketing blunder. If there is one single reason BlackBerry owners (yes! they do still exist) still have a BlackBerry, it’s for the keyboard.

Yes, I know, there is a QWERTY BlackBerry 10 smartphone coming just a couple of weeks or months after the first touchscreen device, but these two should have been joined at the hip at the very minimum.

My other concern is RIM is already showing a break in the company’s focus by introducing two different screen sizes from the gate. The BlackBerry L-series will have a 1280 x 768 screen resolution and the BlackBerry N-series have a 720 x 720-pixel display. In my time playing with an N-series prototype, this square resolution felt incredibly awkward and it’s now two screen sizes that RIM’s developer community has to account for when making apps. Add this to the fact that RIM has enough trouble getting developers on board — of course Microsoft is having trouble there, too — and this feels like it’s not the most optimal scenario.  

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Ashley Hebert and J.P. Rosenbaum Are Married

People Exclusive

By Monica Rizzo

12/01/2012 at 06:15 PM EST

J.P. Rosenbaum and Ashley Hebert

Victor Chavez/Getty

It’s official: Bachelorette star Ashley Hebert and her fiancé J.P. Rosenbaum tied the knot Saturday afternoon in Pasadena, Calif.

Surrounded by family, friends and fellow Bachelor and Bachelorette alumni like Ali Fedotowsky, Emily Maynard, and Jason and Molly Mesnick, the couple said "I do" in an outdoor ceremony officiated by franchise host Chris Harrison.

"Today is all about our friends and family," Hebert, whose nuptials will air Dec. 16 on a two-hour special on ABC, tells PEOPLE. "It's about standing with J.P., looking around at all the people we love in the same room there to celebrate our love."

The 28-year-old dentist from Madawaska, Maine, met New York construction manager Rosenbaum, 35, on season 7 of The Bachelorette. The couple became engaged on the season finale.

Hebert and Rosenbaum are the second couple in the franchise's 24 seasons to make it from their show finale to the altar, following in the footsteps of Bachelorette Trista Rehn, who married Vail, Colo., firefighter Ryan Sutter in 2003.

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Asperger's dropped from revised diagnosis manual

CHICAGO (AP) — The now familiar term "Asperger's disorder" is being dropped. And abnormally bad and frequent temper tantrums will be given a scientific-sounding diagnosis called DMDD. But "dyslexia" and other learning disorders remain.

The revisions come in the first major rewrite in nearly 20 years of the diagnostic guide used by the nation's psychiatrists. Changes were approved Saturday.

Full details of all the revisions will come next May when the American Psychiatric Association's new diagnostic manual is published, but the impact will be huge, affecting millions of children and adults worldwide. The manual also is important for the insurance industry in deciding what treatment to pay for, and it helps schools decide how to allot special education.

This diagnostic guide "defines what constellations of symptoms" doctors recognize as mental disorders, said Dr. Mark Olfson, a Columbia University psychiatry professor. More important, he said, it "shapes who will receive what treatment. Even seemingly subtle changes to the criteria can have substantial effects on patterns of care."

Olfson was not involved in the revision process. The changes were approved Saturday in suburban Washington, D.C., by the psychiatric association's board of trustees.

The aim is not to expand the number of people diagnosed with mental illness, but to ensure that affected children and adults are more accurately diagnosed so they can get the most appropriate treatment, said Dr. David Kupfer. He chaired the task force in charge of revising the manual and is a psychiatry professor at the University of Pittsburgh.

One of the most hotly argued changes was how to define the various ranges of autism. Some advocates opposed the idea of dropping the specific diagnosis for Asperger's disorder. People with that disorder often have high intelligence and vast knowledge on narrow subjects but lack social skills. Some who have the condition embrace their quirkiness and vow to continue to use the label.

And some Asperger's families opposed any change, fearing their kids would lose a diagnosis and no longer be eligible for special services.

But the revision will not affect their education services, experts say.

The new manual adds the term "autism spectrum disorder," which already is used by many experts in the field. Asperger's disorder will be dropped and incorporated under that umbrella diagnosis. The new category will include kids with severe autism, who often don't talk or interact, as well as those with milder forms.

Kelli Gibson of Battle Creek, Mich., who has four sons with various forms of autism, said Saturday she welcomes the change. Her boys all had different labels in the old diagnostic manual, including a 14-year-old with Asperger's.

"To give it separate names never made sense to me," Gibson said. "To me, my children all had autism."

Three of her boys receive special education services in public school; the fourth is enrolled in a school for disabled children. The new autism diagnosis won't affect those services, Gibson said. She also has a 3-year-old daughter without autism.

People with dyslexia also were closely watching for the new updated doctors' guide. Many with the reading disorder did not want their diagnosis to be dropped. And it won't be. Instead, the new manual will have a broader learning disorder category to cover several conditions including dyslexia, which causes difficulty understanding letters and recognizing written words.

The trustees on Saturday made the final decision on what proposals made the cut; recommendations came from experts in several work groups assigned to evaluate different mental illnesses.

The revised guidebook "represents a significant step forward for the field. It will improve our ability to accurately diagnose psychiatric disorders," Dr. David Fassler, the group's treasurer and a University of Vermont psychiatry professor, said after the vote.

The shorthand name for the new edition, the organization's fifth revision of the Diagnostic and Statistical Manual, is DSM-5. Group leaders said specifics won't be disclosed until the manual is published but they confirmed some changes. A 2000 edition of the manual made minor changes but the last major edition was published in 1994.

Olfson said the manual "seeks to capture the current state of knowledge of psychiatric disorders. Since 2000 ... there have been important advances in our understanding of the nature of psychiatric disorders."

Catherine Lord, an autism expert at Weill Cornell Medical College in New York who was on the psychiatric group's autism task force, said anyone who met criteria for Asperger's in the old manual would be included in the new diagnosis.

One reason for the change is that some states and school systems don't provide services for children and adults with Asperger's, or provide fewer services than those given an autism diagnosis, she said.

Autism researcher Geraldine Dawson, chief science officer for the advocacy group Autism Speaks, said small studies have suggested the new criteria will be effective. But she said it will be crucial to monitor so that children don't lose services.

Other changes include:

—A new diagnosis for severe recurrent temper tantrums — disruptive mood dysregulation disorder. Critics say it will medicalize kids' who have normal tantrums. Supporters say it will address concerns about too many kids being misdiagnosed with bipolar disorder and treated with powerful psychiatric drugs. Bipolar disorder involves sharp mood swings and affected children are sometimes very irritable or have explosive tantrums.

—Eliminating the term "gender identity disorder." It has been used for children or adults who strongly believe that they were born the wrong gender. But many activists believe the condition isn't a disorder and say calling it one is stigmatizing. The term would be replaced with "gender dysphoria," which means emotional distress over one's gender. Supporters equated the change with removing homosexuality as a mental illness in the diagnostic manual, which happened decades ago.

___

AP Medical Writer Lindsey Tanner can be reached at http://www.twitter.com/LindseyTanner .

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Cliff fight may knock out December rally

NEW YORK (Reuters) - In normal times, next week's slew of U.S. economic data could be a springboard for a December rally in the stock market.

December is historically a strong month for markets. The S&P 500 has risen 16 times in the past 20 years during the month.

But the market hasn't been operating under normal circumstances since November 7 when a day after the U.S. election, investors' focus shifted squarely to the looming "fiscal cliff."

Investors are increasingly nervous about the ability of lawmakers to undo the $600 billion in tax increases and spending cuts that are set to begin in January; those changes, if they go into effect, could send the U.S. economy into a recession.

A string of economic indicators next week, which includes a key reading of the manufacturing sector on Monday, culminates with the November jobs report on Friday.

But the impact of those economic reports could be muted. Distortions in the data caused by Superstorm Sandy are discounted.

The spotlight will be more firmly on signs from Washington that politicians can settle their differences on how to avoid the fiscal cliff.

"We have a week with a lot of economic data, and obviously most of the economic data is going to reflect the effects of Sandy, and that might be a little bit negative for the market next week, but most of that is already expected - the main focus remains the fiscal cliff," said Peter Cardillo, chief market economist at Rockwell Global Capital in New York.

Concerns about the cliff sent the S&P 500 <.spx> into a two-week decline after the elections, dropping as much as 5.3 percent, only to rally back nearly 4 percent as the initial tone of talks offered hope that a compromise could be reached and investors snapped up stocks that were viewed as undervalued.

On Wednesday, the S&P 500 gained more than 20 points from its intraday low after House Speaker John Boehner said he was optimistic that a budget deal to avoid big spending cuts and tax hikes could be worked out. The next day, more pessimistic comments from Boehner, an Ohio Republican, briefly wiped out the day's gains in stocks.

On Friday, the sharp divide between the Democrats and the Republicans on taxes and spending was evident in comments from President Barack Obama, who favors raising taxes on the wealthy, and Boehner, the top Republican in Congress, who said Obama's plan was the wrong approach and declared that the talks had reached a stalemate.

"It's unusual to end up with one variable in this industry, it's unusual to have a single bullet that is the causal factor effect, and you are sitting here for the next maybe two weeks or more, on that kind of condition," said Sandy Lincoln, chief market strategist at BMO Asset Management U.S. in Chicago.

"And that is what is grabbing the markets."

BE CONTRARY AND MAKE MERRY

But investor attitudes and seasonality could also help spur a rally for the final month of the year.

The most recent survey by the American Association of Individual Investors reflected investor caution about the cliff. Although bullish sentiment rose above 40 percent for the first time since August 23, bearish sentiment remained above its historical average of 30.5 percent for the 14th straight week.

December is a critical month for retailers such as Target Corp and Macy's Inc . They saw monthly retail sales results dented by Sandy, although the start of the holiday shopping season fared better.

With consumer spending making up roughly 70 percent of the U.S. economy, a solid showing for retailers during the holiday season could help fuel any gains.

Ryan Detrick, senior technical strategist at Schaeffer's Investment Research in Cincinnati, believes the recent drop after the election could be a market bottom, with sentiment leaving stocks poised for a December rally.

"The concerns on the fiscal cliff - as valid as they might be - could be overblown. When you look at a lot of the overriding sentiment, that has gotten extremely negative," said Detrick.

"From that contrarian point of view with the historically bullish time frame of December, we once again could be setting ourselves up for a pretty nice end-of-year rally, based on lowered expectations."

SOME FEEL THE BIG CHILL

Others view the fiscal cliff as such an unusual event that any historical comparisons should be thrown out the window, with a rally unlikely because of a lack of confidence in Washington to reach an agreement and the economic hit caused by Sandy.

"History doesn't matter. You're dealing with an extraordinary set of circumstances that could very well end up in the U.S. economy going into a recession," said Phil Orlando, chief equity market strategist at Federated Investors in New York.

"And the likelihood of that is exclusively in the hands of our elected officials in Washington. They could absolutely drag us into a completely voluntary recession."

(Wall St Week Ahead runs every Friday. Questions or comments on this column can be emailed to: charles.mikolajczak(at)thomsonreuters.com )

(Reporting by Chuck Mikolajczak; Editing by Jan Paschal)

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Syria Rebels Find Skype Useful, but Dangers Lurk

In a demonstration of their growing sophistication and organization, Syrian rebels responded to a nationwide shutdown of the Internet by turning to satellite technology to coordinate within the country and to communicate with outside activists.

When Syria’s Internet service disappeared Thursday, government officials first blamed rebel attacks. Activist groups blamed the government and viewed the blackout as a sign that troops would violently clamp down on rebels.

But having dealt with periodic outages for more than a year, the opposition had anticipated a full shutdown of Syria’s Internet service providers. To prepare, they have spent months smuggling communications equipment like mobile handsets and portable satellite phones into the country.

“We’re very well equipped here,” said Albaraa Abdul Rahman, 27, an activist in Saqba, a poor suburb 20 minutes outside Damascus. He said he was in touch with an expert in Homs who helped connect his office and 10 others like it in and around Damascus.

Using the connection, the activists in Saqba talked to rebel fighters on Skype and relayed to overseas activists details about clashes with government forces. A video showed the rebels’ bare-bones room, four battery backups that could power a laptop for eight hours and a generator set up on a balcony.

For months, rebels fighting to overthrow President Bashar al-Assad have used Skype, a peer-to-peer Internet communication system, to organize and talk to outside news organizations and activists. A few days ago, Jad al-Yamani, an activist in Homs, sent a message to rebel fighters that tanks were moving toward a government checkpoint.

He notified the other fighters so that they could go observe the checkpoint. “Through Skype you know how the army moves or can stop it,” Mr. Yamani said.

On Friday, Dawoud Sleiman, 39, a member of the antigovernment Ahrar al-Shamal Battalion, part of the Free Syrian Army, reached out to other members of the rebel group. They were set up at the government’s Wadi Aldaif military base in Idlib, a province near the Turkish border that has seen heavy fighting, and connected to Skype via satellite Internet service.

Mr. Sleiman, who is based in Turkey, said the Free Syrian Army stopped using cellphone networks and land lines months ago and instead relies almost entirely on Skype. “Brigade members communicate through the hand-held devices,” he said.

This week rebels posted an announcement via Skype that called for the arrest of the head of intelligence in Idlib, who is accused of killing five rebels. “A big financial prize will be offered to anyone who brings the head of this guy,” the message read. “One of our brothers abroad has donated the cash.”

If the uprisings in Tunisia and Egypt were Twitter Revolutions, then Syria is becoming the Skype Rebellion. To get around a near-nationwide Internet shutdown, rebels have armed themselves with mobile satellite phones and dial-up modems.

In many cases, relatives and supporters living outside Syria bought the equipment and had it smuggled in, mostly through Lebanon and Turkey.

That equipment has allowed the rebels to continue to communicate almost entirely via Skype with little interruption, despite the blackout. “How the government used its weapons against the revolution, that is how activists use Skype,” Mr. Abdul Rahman said.

“We haven’t seen any interruption in the way Skype is being used,” said David Clinch, an editorial director of Storyful, a group that verifies social media posts for news organizations, including The New York Times (Mr. Clinch has served as a consultant for Skype).

Mr. Assad, who once fashioned himself as a reformer and the father of Syria’s Internet, has largely left the country’s access intact during the 20-month struggle with rebels. The government appeared to abandon that strategy on Thursday, when most citizens lost access. Some Syrians could still get online using service from Turkey. On Friday, Syrian officials blamed technical problems for the cutoff.

The shutdown is only the latest tactic in the escalating technology war waged in Arab Spring countries.

But several technology experts warned that the use of the Internet by rebels in Syria, even those relying on Skype, could leave them vulnerable to government surveillance.

Liam Stack contributed reporting from New York; Hala Droubi from Dubai, United Arab Emirates; and Hwaida Saad from Beirut, Lebanon.

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Zynga shares slide after privileged status with Facebook ends

(Reuters) – Shares of gaming company Zynga Inc fell as much as 10 percent, a day after the “Farmville” creator reached an agreement with Facebook Inc that reduces its dependence on the social networking giant.

The companies reported in regulatory filings on Thursday that they have reached an agreement to amend a 2010 deal that was widely seen as giving Zynga privileged status on the world’s No.1 social network.

Zynga gets a freer hand to operate a standalone gaming website, but gives up its ability to promote its site on Facebook and to draw from the thriving social network of about 1 billion users.

“Although Zynga investors have reacted negatively to Thursday’s announcements so far, we view them as a long-term positive for both companies,” Wedbush Securities analyst Michael Pachter said in a note to clients.

“Zynga now has an advantage to offer more payment options which could result in additional subscribers who are not Facebook users,” he said, maintaining his “outperform” rating and price target of $ 4 on the stock.

Both internet companies have been trying to reduce their interdependence, with Zynga starting up its own Zynga.com platform, and Facebook wooing other games developers.

In recent quarters, fees from Zynga contributed 15 percent of Facebook’s revenue, while Zynga relies on Facebook for roughly 80 percent of its revenue.

Francisco-based Zynga’s shares were down 7 percent at $ 2.44 in morning trading on the New York Stock Exchange on Friday.

Facebook shares were down more than 1 percent at $ 26.98.

(Reporting By Aurindom Mukherjee in Bangalore; Editing by Don Sebastian)

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Dennis Quaid Files for Divorce, Seeks Joint Custody

By Mike Fleeman

11/30/2012 at 09:20 PM EST

Kimberly Buffington-Quaid and Dennis Quaid

Casey Rodgers/NBC/AP

Dennis Quaid is ready to end his marriage for good.

After his wife of eight years, Kimberly Buffington-Quaid, sought legal separation in October, the Vegas star filed Friday for divorce in Los Angeles Superior Court.

The actor requests joint physical and legal custody of their 4-year-old twins, Thomas and Zoe, and offers to pay spousal support, according to the petition.

This will be the third divorce for Quaid, 58, who was previously married to Meg Ryan and P.J. Soles.

Kimberly, a former real estate agent, initially filed for divorce in March. She
put the divorce on hold a month later, pulling the papers so they could work on their marriage, before then filing for separation.

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Kenya village pairs AIDS orphans with grandparents

NYUMBANI, Kenya (AP) — There are no middle-aged people in Nyumbani. They all died years ago, before this village of hope in Kenya began. Only the young and old live here.

Nyumbani was born of the AIDS crisis. The 938 children here all saw their parents die. The 97 grandparents — eight grandfathers among them — saw their middle-aged children die. But put together, the bookend generations take care of one another.

Saturday is World AIDS Day, but the executive director of the aid group Nyumbani, which oversees the village of the same name, hates the name which is given to the day because for her the word AIDS is so freighted with doom and death. These days, it doesn't necessarily mean a death sentence. Millions live with the virus with the help of anti-retroviral drugs, or ARVs. And the village she runs is an example of that.

"AIDS is not a word that we should be using. At the beginning when we came up against HIV, it was a terminal disease and people were presenting at the last phase, which we call AIDS," said Sister Mary Owens. "There is no known limit to the lifespan now so that word AIDS should not be used. So I hate World AIDS Day, follow? Because we have moved beyond talking about AIDS, the terminal stage. None of our children are in the terminal stage."

In the village, each grandparent is charged with caring for about a dozen "grandchildren," one or two of whom will be biological family. That responsibility has been a life-changer for Janet Kitheka, who lost one daughter to AIDS in 2003. Another daughter died from cancer in 2004. A son died in a tree-cutting accident in 2006 and the 63-year-old lost two grandchildren in 2007, including one from AIDS.

"When I came here I was released from the grief because I am always busy instead of thinking about the dead," said Kitheka. "Now I am thinking about building a new house with 12 children. They are orphans. I said to myself, 'Think about the living ones now.' I'm very happy because of the children."

As she walks around Nyumbani, which is three hours' drive east of Nairobi, 73-year-old Sister Mary is greeted like a rock star by little girls in matching colorful school uniforms. Children run and play, and sleep in bunk beds inside mud-brick homes. High schoolers study carpentry or tailoring. But before 2006, this village did not exist, not until a Catholic charity petitioned the Kenyan government for land on which to house orphans.

Everyone here has been touched by HIV or AIDS. But only 80 children have HIV and thanks to anti-retroviral drugs, none of them has AIDS.

"They can dream their dreams and live a long life," Owens said.

Nyumbani relies heavily on U.S. funds but it is aiming to be self-sustaining.

The kids' bunk beds are made in the technical school's shop. A small aquaponics project is trying to grow edible fish. The mud bricks are made on site. Each grandparent has a plot of land for farming.

The biggest chunk of aid comes from the United States President's Emergency Plan for AIDS Relief (PEPFAR), which has given the village $2.5 million since 2006. A British couple gives $50,000 a year. A tree-growing project in the village begun by an American, John Noel, now stands six years from its first harvest. Some 120,000 trees have already been planted and thousands more were being planted last week.

"My wife and I got married as teenagers and started out being very poor. Lived in a trailer. And we found out what it was like to be in a situation where you can't support yourself," he said. "As an entrepreneur I looked to my enterprise skills to see what we could do to sustain the village forever, because we are in our 60s and we wanted to make sure that the thousand babies and children, all the little ones, were taken care of."

He hopes that after a decade the timber profits from the trees will make the village totally self-sustaining.

But while the future is looking brighter, the losses the orphans' suffered can resurface, particularly when class lessons are about family or medicine, said Winnie Joseph, the deputy headmaster at the village's elementary school. Kitheka says she tries to teach the kids how to love one another and how to cook and clean. But older kids sometimes will threaten to hit her after accusing her of favoring her biological grandchildren, she said.

For the most part, though, the children in Nyumbani appear to know how lucky they are, having landed in a village where they are cared for. An estimated 23.5 million people in sub-Saharan Africa have HIV as of 2011, representing 69 percent of the global HIV population, according to UNAIDS. Eastern and southern Africa are the hardest-hit regions. Millions of people — many of them parents — have died.

Kitheka noted that children just outside the village frequently go to bed hungry. And ARVs are harder to come by outside the village. The World Health Organization says about 61 percent of Kenyans with HIV are covered by ARVs across the country.

Paul Lgina, 14, contrasted the difference between life in Nyumbani, which in Swahili means simply "home," and his earlier life.

"In the village I get support. At my mother's home I did not have enough food, and I had to go to the river to fetch water," said Lina, who, like all the children in the village, has neither a mother or a father.

When Sister Mary first began caring for AIDS orphans in the early 1990s, she said her group was often told not to bother.

"At the beginning nobody knew what to do with them. In 1992 we were told these children are going to die anyway," she said. "But that wasn't our spirit. Today, kids we were told would die have graduated from high school."

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On the Internet:

http://www.trees4children.org/

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Wall Street ends higher after swings on 'fiscal cliff'

NEW YORK (Reuters) - Stocks finished higher on Thursday as investors bought on sporadic dips in a market roiled by conflicting comments from Washington about negotiations on an agreement to avoid the "fiscal cliff."

Tech shares, including Research In Motion and Advanced Micro Devices , helped the Nasdaq outperform the broader market. Telecommunications and health-care stocks were the day's best-performing sectors.

Reflecting the uncertainty surrounding U.S. budget talks, trading was choppy. Wall Street reversed early gains and fell shortly after House Speaker John Boehner, the top Republican in Congress, dashed hopes that lawmakers were getting closer to a budget deal that would avert automatic tax increases and spending cuts set for early 2013 - the fiscal cliff - that could push the U.S. economy into a recession next year. But the market rebounded by afternoon and the three major U.S. stock indexes rebounded to near their session highs.

"There is an emotional part in buying on the small dips here. Investors are more worried about missing the rally than losing money as they believe that the 'fiscal cliff' will be solved eventually," said James Dailey, portfolio manager at TEAM Asset Strategy Fund in Harrisburg, Pennsylvania.

"Until the fiscal cliff is solved, the madness of the crowd will not subside."

Discussions on Capitol Hill are aimed at avoiding big automatic spending cuts and tax hikes, known as the fiscal cliff, that will start taking effect beginning in January.

Boehner's comment about a lack of progress in talks with the White House was one of a series of contrary pronouncements by lawmakers and the Obama administration over whether Washington will finally cut a deal.

There have been some signs that leaders are moving closer to a fiscal agreement. The S&P 500 has gained about 5 percent recently after a sell-off that took it down almost 8 percent following the U.S. election on November 6. But investors remain wary that politicians' ad hoc statements can spark quick reversals in the market.

U.S.-listed shares of BlackBerry maker Research In Motion rose 4 percent to $11.54 after Goldman Sachs upgraded the stock to "buy" from "neutral" on optimism ahead of the launch of the BlackBerry 10 smartphone.

Advanced Micro Devices Inc shares gained 4.1 percent to $2.04 on plans to sell and lease back its campus in Austin, Texas. The sale and lease-back will raise cash and fund its chipmaking business as Advanced Micro Devices diversifies beyond the struggling PC industry into new markets.

The Dow Jones industrial average <.dji> rose 36.71 points, or 0.28 percent, to 13,021.82 at the close. The Standard & Poor's 500 Index <.spx> gained 6.02 points, or 0.43 percent, to 1,415.95. The Nasdaq Composite Index <.ixic> advanced 20.25 points, or 0.68 percent, to close at 3,012.03.

So far this week, the Dow is up 0.1 percent, the S&P 500 is up 0.5 percent and the Nasdaq is up 1.5 percent.

But shares of top retailers retreated in the wake of data showing a weak start to November sales after Superstorm Sandy. Kohl's Corp fell 12 percent to $45.02.

Tiffany shares dropped 6.2 percent to $59.80 after the upscale jeweler reported quarterly results and cut its full-year sales and profit forecasts.

Supervalu shares sank 18.6 percent to $2.28 after a report that Cerberus Capital Management was having difficulty obtaining financing to buy out the troubled grocery chain.

Data showed the U.S. economy grew faster than initially thought in the third quarter as businesses restocked, but consumer and business spending were revised lower in a sobering reminder of the economic recovery's underlying weakness.

Contracts to buy previously owned U.S. homes rose more than expected in October, a sign the housing market recovery advanced into the fourth quarter despite a mammoth storm and concerns over looming tax hikes. Homebuilders' shares rose. The PHLX housing index <.hgx> rose 0.8 percent.

About 6.15 billion shares changed hands on the New York Stock Exchange, the Nasdaq and NYSE MKT, below the daily average so far this year of about 6.48 billion shares.

On both the NYSE and the Nasdaq, roughly three stocks rose for every one that fell.

(Editing by Kenneth Barry and Jan Paschal)

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General Assembly Grants Palestine Upgraded Status in U.N.

Chang W. Lee/The New York Times

President Mahmoud Abbas of the Palestinian Authority spoke at the United Nations before the General Assembly voted on Palestine's status as a “nonmember observer state” on Thursday.

UNITED NATIONS — More than 130 countries voted on Thursday to upgrade Palestine to a nonmember observer state of the United Nations, a triumph for Palestinian diplomacy and a sharp rebuke to the United States and Israel.

But the vote, at least for now, did little to bring either the Palestinians or the Israelis closer to the goal they claim to seek: two states living side by side, or increased Palestinian unity. Israel and the militant group Hamas both responded critically to the day’s events, though for different reasons.

The new status will give the Palestinians more tools to challenge Israel in international legal forums for its occupation activities in the West Bank, including settlement-building, and it helped bolster the Palestinian Authority, weakened after eight days of battle between its rival Hamas and Israel.

But even as a small but determined crowd of 2,000 celebrated in central Ramallah in the West Bank, waving flags and dancing, there was an underlying sense of concerned resignation.

“I hope this is good,” said Munir Shafie, 36, an electrical engineer who was there. “But how are we going to benefit?”

Still, the General Assembly vote — 138 countries in favor, 9 opposed and 41 abstaining — showed impressive backing for the Palestinians at a difficult time. It was taken on the 65th anniversary of the vote to divide the former British mandate of Palestine into two states, one Jewish and one Arab, a vote Israel considers the international seal of approval for its birth.

The past two years of Arab uprisings have marginalized the Palestinian cause to some extent as nations that focused their political aspirations on the Palestinian struggle have turned inward. The vote on Thursday, coming so soon after the Gaza fighting, put the Palestinians again — if briefly, perhaps — at the center of international discussion.

“The question is, where do we go from here and what does it mean?” Salam Fayyad, the Palestinian prime minister, who was in New York for the vote, said in an interview. “The sooner the tough rhetoric of this can subside and the more this is viewed as a logical consequence of many years of failure to move the process forward, the better.” He said nothing would change without deep American involvement.

President Mahmoud Abbas of the Palestinian Authority, speaking to the assembly’s member nations, said, “The General Assembly is called upon today to issue a birth certificate of the reality of the state of Palestine,” and he condemned what he called Israeli racism and colonialism. His remarks seemed aimed in part at Israel and in part at Hamas. But both quickly attacked him for the parts they found offensive.

“The world watched a defamatory and venomous speech that was full of mendacious propaganda against the Israel Defense Forces and the citizens of Israel,” Prime Minister Benjamin Netanyahu of Israel responded. “Someone who wants peace does not talk in such a manner.”

While Hamas had officially backed the United Nations bid of Mr. Abbas, it quickly criticized his speech because the group does not recognize Israel.

“There are controversial issues in the points that Abbas raised, and Hamas has the right to preserve its position over them,” said Salah al-Bardaweel, a spokesman for Hamas in Gaza, on Thursday.

“We do not recognize Israel, nor the partition of Palestine, and Israel has no right in Palestine,” he added. “Getting our membership in the U.N. bodies is our natural right, but without giving up any inch of Palestine’s soil.”

Israel’s ambassador to the United Nations, Ron Prosor, spoke after Mr. Abbas and said he was concerned that the Palestinian Authority failed to recognize Israel for what it is.

“Three months ago, Israel’s prime minister stood in this very hall and extended his hand in peace to President Abbas,” Mr. Prosor said. “He reiterated that his goal was to create a solution of two states for two peoples, where a demilitarized Palestinian state will recognize Israel as a Jewish state.

“That’s right. Two states for two peoples. In fact, President Abbas, I did not hear you use the phrase ‘two states for two peoples’ this afternoon. In fact, I have never heard you say the phrase ‘two states for two peoples’ because the Palestinian leadership has never recognized that Israel is the nation-state of the Jewish people.”

The Israelis also say that the fact that Mr. Abbas is not welcome in Gaza, the Palestinian coastal enclave run by Hamas, from which he was ejected five years ago, shows that there is no viable Palestinian leadership living up to its obligations now.

Jennifer Steinhauer contributed reporting from Washington, Isabel Kershner from Jerusalem, and Khaled Abu Aker from Ramallah, West Bank.

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