This morning’s key headlines from GenerationalDynamics.com.

* Investors bet that Greece’s default is now certain

* Latest crisis blamed on resignation of Jürgen Stark from ECB

* Italy turns to China for help in debt crisis

* Many Palestinians are opposing statehood bid

* U.S. sends aid to Pakistan flood victims

* After winning at ‘Jeopardy!’, IBM’s Watson will become a doctor’s assistant

Investors bet that Greece’s default is now certain

Greece’s 2 year bond yields at 69.551%

The probability that Greece will default on its debt has now reached 98%. This is calculated by the prices of credit default swaps (CDSs), which are a kind of insurance policy that investors can purchase when they want to bet that a certain investment is going to default. The prices of CDSs on Portugal, Italy and France has surged to new records, indicating that investors are betting that the Greek “contagion” will spread to those countries. The cost CDSs for corporate debt has risen to the highest levels in 2 1/2 years, the period following the collapse of Lehman Brothers. Chancellor Angela Merkel’s government is now debating how to support German banks when Greece defaults. Bloomberg

Italy turns to China for help in debt crisis

According to pundits, the reason that Wall Street stocks were sharply down on Monday morning was because of the threat of Greece’s default. Then, stock prices recovered around 3 pm, and many pundits are crediting that to an announcement by Italy’s government that they were talking to the Chinease, and were hoping for “significant” purchases of Italian bonds and investments in Italian companies. When I wrote my article on the 1932 book, “The bubble that broke the world,” I suggested that just as America tried to bail out Germany in 1931, China might try to bail out America in the current crisis. Well, perhaps a variation of that suggestion is occurring, in that China may be trying to bail out Europe. Financial Times (Access).

Latest crisis blamed on resignation of Jürgen Stark from ECB

Jürgen Stark

Many analysts are blaming the “sudden” loss of faith in Greece’s bailout to a seemingly insignificant event — the resignation on Friday of Jürgen Stark, Germany’s representative at the European Central Bank (ECB). The ECB has been purchasing bonds issued by Spain and Italy as Europe’s form of quantitative easing, to prevent those two countries from going into default. Stark was strenuously opposed to the bond purchases, and resigned in protest. His resignation signaled a split within the ECB of the bond purchases, making it less likely that there will be more bond purchases in the future. CNN

Many Palestinians are opposing statehood bid

In just over a week, Palestinian Authority (PA) president Mahmoud Abbas will be presenting his proposal for Palestinian statehood to the United Nations General Assembly. Abbas has kept the text of the statehood bid top secret, in order to put the United States and Israel at a disadvantage. However, the secrecy is also worrying many Palestinians, who point out that if the U.N. endorses a Palestinian state based on 1967 borders, then the Palestinia diaspora will lose the “right of return” to their homes inside “historic Palestine,” or present-day Israel. Another objection is that the state would merely consist of a series of isolated Palestinian cantons, or Bantustans. “Of course I hope for a state of our own, like Israel has,” says one activist. “But ours will be Bethlehem here, Ramallah here, Nablus there, and the West Bank and Gaza still separated. How can they have one government?” Palestine News Network

U.S. sends aid to Pakistan flood victims

Homeless from floods

Last year’s floods in Pakistan were the worst in the country’s history, covering some 20% of the entire country, leaving millions of people homeless. This year’s floods are not as bad, but the torrential rains have already left 200 dead and affected hundreds of thousands of people. The U.S. on Monday sent food and medical aid to Pakistan for flood victims. Food aid is targeted at nearly 350,000 Pakistanis, while Washington hopes the medical assistance can reach “about 500,000.” AFP

After winning at ‘Jeopardy!’, IBM’s Watson will become a doctor’s assistant

As we described last February in “19-Feb-11 News — IBM’s Watson supercomputer bests human champions on Jeopardy!”, the computer’s spectacular victory brings us closer to the Singularity, the point in time, around 2030, when computers will be more intelligent and more creative than humans. Now, IBM has has signed a contract with health insurer WellPoint for a major, high-profile application of Watson. Watson will provide computerized guidance, and help suggest treatmen options and diagnoses, for doctors and nurses managing complex patient cases. Wall Street Journal (Access)