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Page 1: 2014 03 13 cmyk NA 04 - The Wall Street Journalonline.wsj.com/public/resources/documents/PageOne031314.pdf · lumbia—It’snot always easy to spot an ungainly ungulateinthe dead

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What’sNews

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World-Widen U.S. investigators suspectthat a missing Malaysian air-liner stayed in the air for hourspast the time it reached itslast confirmed location, basedon engine data transmittedfrom the aircraft. A1, A8n The U.S. scrambled toavert a diplomatic crisis withMoscow ahead of a vote inCrimea on leaving Ukraineand returning to Russia. A1n The U.S. could suffer a na-tionwide blackout if saboteursknocked out nine key substa-tions on a high-demand day, ac-cording to a federal analysis.A1n Sebelius said health-insur-ance premiums are “likely togo up” in 2015 but at aslower pace than before. A4nObama is ordering newrules on overtime pay, sparkingdebate over whether themovewill boost workers’ wages.A4n Israel’s parliament passed alaw stripping ultraorthodoxJewish men of their exemp-tion from the military. A9nGazamilitants fired rock-ets into Israel in the largest at-tack since a 2012 cease-fire. A9nThe top Democrat on theHouse intelligence panel calledfor an end to the NSA’s phone-data collection program. A2nTurkish police clashed withprotesters after the funeral ofa teen killed by police. A7nChina’s Xi called on the mil-itary to defend national inter-ests amid concerns in Asiaover Beijing’s assertiveness. A8nSyria’s regime is trying tocontain supporters’ anger afternuns freed by rebels expressedsympathy for their captors. A11

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GMsaid it knew of faulty ig-nition switches linked to a

recall and 12 deaths as early as2001 and has yet to determinethe problem’s full scope. B1n The Fed studied a foreign-exchange benchmarkmonthsbefore global regulators warnedof potential manipulation,but took no public action. C1nWall Street’s bonus poolswelled by 15% to $26.7 bil-lion this year, a study sug-gests, as employees cashedin their restricted shares. C1n The FTC opened a probeinto Herbalife, which has beenbattling hedge-fund managerAckman over his allegationsthat it is a pyramid scheme. B1nCitigroup cut the pay of thehead of its embattled Mexicounit and said it may cut otheremployees’ compensation. C1nAn ex-Credit Suisse bankeradmitted to helping U.S. clientsevade taxes in a plea deal be-fore a Virginia court. C3nPuerto Rican bonds surgedasmuch as 7.5%, a day after in-vestors scrambled to get a pieceof the $3.5 billion debt sale. C1nThe S&P 500 edged up to1868.20, while the Dow shed11.17 points to 16340.08 onwor-ries over growth in China. C4n Ex-Goldman trader Tourrewas fined over $825,000 forviolating securities laws anddefrauding investors. C3n “Candy Crush”maker KingDigital is targeting a $7.6 billionmarket valuewith its IPO.B1, B7n Energy XXI agreed to buyEPL Oil & Gas in a $1.53 bil-lion cash-and-stock deal. B3

Business&Finance

The U.S. launched a last-ditcheffortWednesday to avert a poten-tially costly diplomatic crisis withMoscow ahead of a vote Sunday inCrimea on whether the regionshould leave Ukraine and return toRussia.

Top Obama administration offi-cials sought to ramp up the pres-sure on Moscow even as theybraced for a possible diplomaticfailure. U.S. Secretary of StateJohn Kerry said Russia “may well”end up annexing the restive region,and began to focus on steps Mos-cow could take to slow the process.

The mood in Washington hadan 11th-hour feel. Mr. Kerryplanned a hasty diplomatic trip toLondon to meet his Russian coun-terpart on Friday—two days beforethe fateful referendum—while theadministration’s warnings took onan even more dire tone.

Mr. Kerry told lawmakers that ifRussia made the wrong decisionsand the West turned to punitivesanctions, things could “get uglyfast” and “in multiple directions.’’

But there was growing interna-tional resignation over the futureof Crimea, which was part of Rus-sia until the 1950s and still hostsRussia’s Black Sea Fleet.

German Chancellor AngelaMerkel, who has led Europe’s re-sponse to Russia’s occupation ofCrimea, and her team have cometo the conclusion that the chanceto roll backMoscow’s interventionhas passed, according to officialsand analysts.

President Barack Obama metthe new Ukrainian PrimeMinisterArseniy Yatsenyuk at the WhiteHouse, saying he hopes those be-

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BY CAROL E. LEEAND JAY SOLOMON

ScrambleToEaseUkraineCrisis

LONDON—One of the firstthings Mark Carney did when hetook over the Bank of Englandlast July was to remove a paint-ing of Montagu Norman from awall near his office. Mr. Normanwas the eccentric BOE governorwhose policies are often blamedfor exacerbating the Great De-pression—mistakes Mr. Carneydidn’t want to repeat.

In Mr. Carney’s eight tumultu-ous months at the helm, duringwhich the central bank bungledits economic forecasts and gotdragged into a foreign-exchangeprobe, the United Kingdom hasenjoyed a surprising economic

revival. Now, looming decisionsabout when to increase interestrates are shaping up as his mostimportant test, and a criticalcase study for the U.S. and otherdeveloped economies.

The U.K., U.S., Europe and Ja-pan have held interest rates atrecord lows since the financialcrisis in an effort to encouragelending, energize growth andbring down unemployment. Astheir economies recover, all mustdecide when to declare victoryand let borrowing costs rise.

All want to hold off as long aspossible, but getting a messageacross about how long has be-come complicated. If growth andhiring live up to expectations,

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BY JASON DOUGLASAND JON HILSENRATH

‘EXPERIMENTAL PHASE’

From London, a Test CaseFor World’s Central Bankers

Sources: U.K. Office of National Statistics;U.S. Labor Dept.

The Wall Street Journal

Job DriveU.K. and U.S. unemployment rateshave fallen more quickly of latethan central banks anticipated.

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’08 ’09 ’10 ’11 ’12 ’13 ’142007

U.K.: 7.2%December

U.S.: 6.7%February

Gas Suspected in Deadly Blast That Leveled New York Buildings

COLLAPSE: Three women died, more than two dozen people were injured and others were missing after an explosion Wednesday destroyed two buildings. A2

Justin

Heiman/G

etty

Images

Canadians Gone Wild: Critter TallyBrings Out Their Competitive Side

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Volunteers Vie to Count the Most AnimalsFor Bragging Rights, Fish Measuring Tape

FORT ST. JOHN, British Co-lumbia—It’s not always easy tospot an ungainly ungulate in thedead of winter, even in the re-mote back country along theAlaska Highway where roadsigns routinely warn drivers ofmoose crossing and the only lo-cally owned and operated radiostation isproudly knownas Moose FM.

That is thechallenge for ahardy brace ofoutdoor enthu-siasts who taketo their snow-mobiles andsnowshoes fortwo days eachwinter to produce a tally of ev-ery critter in the nearbystretches of the Peace River val-ley, from squirrels and foxes toelk and bull moose.

What makes the count in this

former trading post unusual:unlike most wildlife counts forlarger mammals in North Amer-ica, it relies on roughly a coupleof dozen volunteer “citizen sci-entists” instead of professionalbiologists. The official sloganfor the event: “Take a walk onthe wild side—and count them!”

Hard-core participants com-pete fiercely to spot the most

animals in thecontest, whichis sponsored bythe forestryarm of BritishColumbia, Can-ada’s western-most province.In addition tovying for brag-ging rights,they are en-

tered in a drawing for prizessuch as fish measuring tapekits, hand warmers and snarewire, supplied by local mer-chants.

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BY CHESTER DAWSON

Western Canadian moose

The U.S. could suffer a coast-to-coast blackout if saboteursknocked out just nine of thecountry’s 55,000 electric-trans-mission substations on a scorch-ing summer day, according to apreviously unreported federalanalysis.

The study by the Federal En-ergy Regulatory Commissionconcluded that coordinated at-tacks in each of the nation’sthree separate electric systemscould cause the entire powernetwork to collapse, people fa-miliar with the research said.

A small number of the coun-try’s substations play an outsizerole in keeping power flowingacross large regions. The FERCanalysis indicates that knockingout nine of those key substationscould plunge the country intodarkness for weeks, if notmonths.

“This would be an event ofunprecedented proportions,”said Ross Baldick, a professor ofelectrical engineering at the Uni-versity of Texas at Austin.

No federal rules require utili-ties to protect vital substationsexcept those at nuclear powerplants. Regulators recently saidthey would consider imposingsecurity standards.

FERC last year used softwareto model the electric system’sperformance under the stress oflosing important substations.The substations use large powertransformers to boost the volt-age of electricity so it can movelong distances and then to re-duce the voltage to a usable levelas the electricity nears homesand businesses.

The agency’s so-called power-flow analysis found that differentsets of nine big substations pro-duced similar results. The WallStreet Journal isn’t publishingthe list of 30 critical substationsstudied by FERC. The commis-sion declined to discuss the anal-ysis or to release its contents.

Some federal officials said theconclusions might overstate the

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BY REBECCA SMITH

Nation’sPower GridVulnerableTo Sabotage

Germany’s Merkel digs in forlong-term conflict...................... A10

EU slows Russian pipelines... A10 Heard on the Street.................. C10

U.S. investigators suspect thatMalaysia Airlines Flight 370 stayedin the air for about four hours pastthe time it reached its last con-firmed location, according to twopeople familiar with the details,raising the possibility that theplane could have flown on for hun-dreds of additional miles under

conditions that remain murky.The investigators believe the

plane flew for a total of five hoursbased on data automatically down-loaded and sent to the groundfrom the Boeing Co. 777’s enginesas part of a routine maintenanceand monitoring program.

That raises a host of new ques-tions and possibilities about whathappened aboard the widebody jet

carrying 239 people, which van-ished from civilian air-traffic con-trol radar over the weekend, aboutone hour into a flight to Beijingfrom Kuala Lumpur.

Six days after the mysteriousdisappearance prompted a massiveinternational air and water searchthat so far hasn’t produced any re-sults, the investigation appears tobe broadening in scope.

U.S. counterterrorism officialsare pursuing the possibility that apilot or someone else on board theplane may have diverted it towardan undisclosed location after inten-tionally turning off the jetliner’stransponders to avoid radar detec-tion, according to one persontracking the probe.

The investigation remains fluid,and it isn’t clear whether investi-

gators have evidence indicatingpossible terrorism or espionage. Sofar, U.S. national security officialshave said that nothing specificallypoints toward terrorism, thoughthey haven’t ruled it out.

But the huge uncertainty aboutwhere the plane was headed, andwhy it continued flying so longwithout working transponders, has

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BY ANDY PASZTOR

Missing Airplane Flew On for HoursEngineDataSuggestMalaysiaFlightWasAirborneLongAfterRadarDisappearance,U.S. Investigators Say

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