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NEWS STREAM

Italy's New Leader; Fate of European Union as Technocrats Take Charge; Syria's New Sanctions and Suspension From Arab League; Brazil Police Take Over Largest Rio Slum Rocinha Today; President Barack Obama Calls For China To Stop Devaluing Currency; Locals Begin Cleanup of Thai City Ayutthaya

Aired November 14, 2011 - 08:00:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


KRISTIE LU STOUT, HOST: Welcome to NEWS STREAM, where news and technology meet.

I'm Kristie Lu Stout, in Hong Kong.

And we begin in Italy, where a new leader is putting together his new government and plotting away out of his country's economic problems.

Syria's foreign minister warns the Arab League. He says suspending Damascus would be a dangerous step.

And tanks roll into a Brazilian slum as Rio cleans up ahead of both the World Cup and the Olympics.

From a tycoon to a technocrat, the face of leadership Italy's leadership undergoes a dramatic change. Former European commissioner and Prime Minister-designate Mario Monti is working to form Italy's next government. And his mandate is to lead Italy out of its market-shaking debt crisis and push through tough new austerity measures. Now, he is replacing Silvio Berlusconi, who resigned to cheers and dancing in the streets.

Monti is meeting with Italy's main political parties today as he begins assembling a cabinet. And Matthew Chance is watching developments in Rome and joins us now.

And Matthew, will Mario Monti be able to bring Italy's finances under control?

MATTHEW CHANCE, CNN SR. INTERNATIONAL CORRESPONDENT: Well, I think there's no doubt, Kristie, that many people believe -- economists, the money markets believe, many Italians believe -- that Mario Monti is a safe pair of hands and he's a good person, an economist, to put forward the kind of measures that the country needs to get its economy back on track. The big question, of course, is will he manage to get those bills passed into law?

He's going to face a number of opposition fronts, the first one in parliament, the same parliament that was headed by Silvio Berlusconi, of course. There hasn't been elections. They still control the parliament, and so any measures that he proposes to get into law has to be passed by a majority in the house. Then, of course, it's the Italian public.

It's a country that's head protests in the recent past when it comes to austerity measures. There's bound to be a lot of public disorder as we move forward into what will be, if they go through, very difficult, very deep cuts, indeed, to the standard of living, in many cases, of Italians. So it's going to be a very difficult set of measures that Mario Monti -- he's going to have to try to implement.

STOUT: And you've also been watching Italian bond yields closely. How are they trading today?

CHANCE: Well, I mean, they haven't gone wild as they did last week when Silvio Berlusconi was still in office. They've stabilized around the mid six percentage points area, which is still very high. It's still difficult to manage, but it's not in the sort of bailout territory, beyond seven percent.

And so I suppose there's been a sort of relatively stabilizing impact of Mario Monti's nomination as the country's prime minister, but the money markets, like Italians, are watching to see what progress he can make in the months ahead.

STOUT: Matthew Chance, live in Rome.

Thank you.

Now, in Italy and in Greece, we're seeing so-called technocrats take the reins as both countries try to come back from the brink of financial disarray. And Tim Lister reports the fate of the European Union could be at stake.

(BEGIN VIDEOTAPE)

TIM LISTER, CNN INTERNATIONAL CORRESPONDENT (voice-over): Gone, four prime ministers in less than a year. But the problems that defeated them live on: governments with chronic debt and a European Union that's far from united.

The single European currency was introduced with great fanfare 12 years ago. The guardian of its value, the European Central Bank. But other policy tools like tax and borrowing were left in the hands of governments, and it was like trying to drive a car in two different gears.

Greece, like Spain and Portugal, borrowed plenty and built generous welfare systems on economies that couldn't support them. In Italy, protests erupted whenever budget cuts were contemplated. But now comes Europe's moment of truth.

ALAN BROWN, CHIEF INVESTMENT OFFICER, SCHRODERS: I really do fear that we're getting very dangerously close to a disorderly collapse. We see early signs of a credit crunch within the eurozone area.

LISTER: Writing in "The Financial Times," former British prime minister John Major said that for Greece to stay in the Eurozone, "Wages must fall, unemployment will rise and social unrest will increase. The severity of this medicine may not be bearable in a liberal democracy."

As for the new government, led by technocrats like Lucas Papademos and Mario Monti --

MARTIN WOLF, "FINANCIAL TIMES": What is surely going to happen in fairly short order is there are going to be protests against these governments, and they're going to say, you're not our government, you're Germany's government. You're the government that our paymasters have put in place.

LISTER: Plenty of Greeks protest they've been bullied by Germany. Two- thirds of Germans say they're fed up with bailing out the Greeks.

NIALL FERGUSON, AUTHOR: If you create a monetary union with such incompatible economies, Germany at the core of the periphery, not really competitive, something has got to give. And it's not clear to me what it will be. It's very hard for countries to leave the eurozone, and it's very hard for the Germans to bail them out.

LISTER: To save the eurozone, Germany has to underwrite the process and the European Central Bank needs the firepower to manage it.

BROWN: The only realistic firebreak that would be strong enough to do this relies on the participation of two institutions, Germany as a country, and the ECB, as the financial vehicle with sufficient clout. And that's difficult. It's difficult for Germany to accept, and it's difficult for the ECB to do at the moment, because it would be a direct breach of the Lisbon treaty.

UNIDENTIFIED MALE: Solidarity with the rest of the world.

LISTER: Ah, the Lisbon treaty, 784 pages with (INAUDIBLE) and annexes which had to be ratified by all 27 EU members, one reason the EU has never been the definition of agility. Now it badly needs to be.

The bigger question, can the less dynamic economies of southern Europe be made to behave like industrious Germany? If not --

WOLF: The core countries -- or the core country, above all -- will say that was the best shot we had, these people are just not going to do what they're supposed to do. We're not going to allow the European Central Bank to print money to bail them out, and we're not going to change our own policies. So, actually, one way or another, we're going to have to dismantle this.

LISTER: But if the eurozone can be saved by binding its members even tighter together, what about those EU members including Britain, Poland and Sweden, that never adopted the single currency? They'll be even more out of step. The euro may survive, but the European Union may begin to fall apart.

Tim Lister, CNN, Atlanta.

(END VIDEOTAPE)

STOUT: Now, one way to measure international confidence in Italy and Greece is to look at the markets. And in Europe, shares have been falling this Monday, showing that there's a lot of nervousness out there. And this comes as Italy auctioned off $4 billion worth of five-year bonds at a record 6.29 percent yield today.

(STOCK MARKET REPORT)

STOUT: Now, ahead on NEWS STREAM, turning the screws on Syria's regime. Suspension from the Arab League is imminent. What more might the international community do?

After months under water, Thailand's famous temple in Ayutthaya begin to dry out.

And more Occupy Wall Street camps are being shut down, but donations are still pouring in. We'll take a look at the global movement's money management.

(COMMERCIAL BREAK)

STOUT: Now, the Syrian regime faces new sanctions from Europe and suspension from the Arab League. Syria's foreign minister says the league has taken a dangerous step with its decision to oust Damascus, but he apologized for the attacks on embassies following that vote.

Crowds loyal to President Bashar al-Assad mobbed diplomatic buildings, and they have also taken to the streets in large numbers, carrying pictures of the president. But some activists say people are being forced to join the demonstrations.

Now, the anti-government protests, they started some eight months ago and have been met with brutal suppression. The United Nations says more than 3,500 people have been killed.

Syria's due to be suspended on Wednesday, but it is calling for an emergency Arab summit.

Our Rima Maktabi is monitoring developments from Abu Dhabi, and she joins us now.

And Rima, just how rattled is the government of Bashar al-Assad after this Arab League decision?

RIMA MAKTABI, CNN INTERNATIONAL CORRESPONDENT: Kristie, it's a very significant threat (ph) conference coming out of Damascus today. Walid al- Moualem, the foreign minister, talked for more than an hour and a half, and he opened the floor for many questions coming in from journalists. We heard two main points repeated more than once.

First, he said Syria is not Libya, it will not be the same scenario. And second, he repeated the word "conspiracy."

The Syrian regime really is convinced that this is a conspiracy coming against the regime, against the Syrian people. And he also sounded defiant towards the Arab League. Syria will stick to the Arab solution to the problems until now. That's what Walid al-Moualem said. But he also said that the repercussions of the events happening in Syria and the Arab world are dangerous for the region -- Kristie.

STOUT: So, defiance from Syria's foreign minister.

And meanwhile, EU foreign ministers are discussing imposing more sanctions on Syria. So what impact will that have on the crackdown?

MAKTABI: Historically, we know that sanctions usually harm the people. And Walid al-Moualem said on the record today, to the media -- he said, "These sanctions will only harm the Syrian people, and not the Syrian regime."

However, these sanctions are significant, Kristie, because this is a mounting international pressure. Now we are witnessing a case being built against the Syrian regime at the U.N. Security Council. Walid al-Moualem said, "Russia and China are still backing us up." But this will have to be decided in the coming few days, as Russia -- as France is speaking, Britain, and the EU is announcing more sanctions, and the Arab League has a strong statement against the regime -- Kristie.

STOUT: And also, what is the latest inside Syria, where we have Syrians both for and against the regime out in force, protesting?

MAKTABI: Well, Kristie, yesterday, according to the activists -- now, we're not on the ground, international media has not been allowed in, but activists are saying yesterday alone, 30 people were killed inside Syria. They are opposition members and they were protesting.

Now, the interesting part is that we've started to see rallies with Assad. The opposition is saying that these rallies are forced on people. However, some people are genuinely still backing the regime.

STOUT: Rima Maktabi, live from CNN Abu Dhabi.

Thank you very much for that.

And turning now to Yemen, a terrifying five-month ordeal is finally over for three French aid workers. Now, they were kidnapped from this southern city on May the 28th, and the organization that they work for says that their release is a huge relief. The French president, Nicolas Sarkozy, thanked the sultan of Oman for his role in securing the hostages' freedom. It's unclear if Oman paid a ransom.

Now, Agence France-Presse reports that the recently released trio are now on their way home to France.

A suspected suicide bomber has been killed by Afghan security forces in Kabul ahead of an important meeting between the government and tribal leaders.

And for the latest, I'm joined now live by Nick Paton Walsh, who's in the capital.

Nick, a lot to discuss this day. But first, the thwarted suicide bombing, how did it unfold?

OK. Unfortunately -- yes. Sorry for that.

Obviously, we're not connected with our Nick Paton Walsh, live in Kabul. We'll try to reconnect there. Apologies there.

You're watching NEWS STREAM. We'll be back right after the break. Keep it here.

(COMMERCIAL BREAK)

STOUT: Coming to you live from Hong Kong, you are back watching NEWS STREAM.

Now, a suspected suicide bomber has been killed by Afghan security forces in Kabul ahead of the loya jirga.

Let's get straight to our Nick Paton Walsh. He joins us live.

And Nick, this thwarted suicide bombing, what are the latest details?

NICK PATON WALSH, CNN INTERNATIONAL CORRESPONDENT: Well, it transpires -- this suicide bomber failed (INAUDIBLE), I should say -- approached one of the key checkpoints around this loya jirga. Now, this is an absolutely essential meeting of tribal elders called by Afghan President Hamid Karzai to discuss America's future presence here, a kind of strategic partnership agreement between those two nations, and perhaps also discuss whether a peace between the Afghan government and the insurgency is possible. An absolutely vital meeting.

And we understand this suicide bomber approached one of the checkpoints on the outskirts of a compound where this big meeting will be held the day after tomorrow, was searched by police, and then subsequently shot dead. Scant details at the moment, but this instance has helped add to the general feeling of insecurity ahead of this absolutely vital political summit -- Kristie.

STOUT: Also, another big story there, the Taliban are claiming that they have obtained confidential Afghan security plans.

Nick, what documents do they have, and are they truly in Taliban hands?

WALSH: We don't know if these documents are real. This emerged late last night.

The Taliban, coming forward, saying that they thought they had leaked from the government what they said were the security plans for this vital tribal elders meeting. Now, that was immediately dismissed by the Interior Ministry here, and ISAF didn't seem to concerned, pointing out also that the Taliban had said they'd do anything they possibly could to try and disrupt this meeting.

The plans did seem detailed, and some people suggested they could have a degree of authenticity about them, although there's no evidence really from anyone official to suggest that. But it really points to this information war growing between the insurgency and coalition forces. ISAF say that the Taliban are resorting to propaganda like this because they can't win on the battlefield, whereas the Taliban and some Afghans point to the Taliban getting more sophisticated, perhaps, in their approach. And if this is true, getting great intelligence from the deepest secret circles of the Afghan government -- Kristie.

STOUT: So this could very well be a propaganda war.

And also, Nick, what is your read on the Afghan government's ability to secure the loya jirga this week? A number of key leaders will be there. Will they be adequately protected?

WALSH: Extremely hard to tell, to be honest. The Taliban have shown a remarkable reach inside what should have been the securest parts of the capital in the past months or so.

Remember the assassination of a key Afghan peace negotiation, the shootout against the U.S. Embassy that lasted for 20 hours, signs that they can seem to get to the (INAUDIBLE) Kabul, which should be completely shut off. Huge preparations here, great paranoia, great concern, I think, from Afghan and ISAF security forces. So they'll be doing everything they possibly can, but we have seen in the past months that there are no real guarantees inside the capital -- Kristie.

STOUT: Nick Paton Walsh, joining us live from Kabul.

Thank you for that.

Now let's switch tracks and go to sports. And Roger Federer has won 15 Grand Slam titles and rang victorious in tournaments all over the world. But on Sunday, he did something he had never done before.

Pedro Pinto joins us now with details on that and the rest of sports -- Pedro.

PEDRO PINTO, CNN SPORTS ANCHOR: Hey, Kristie.

You're right. You know, it's another check in his career. For the first time in his long and successful time as a professional tennis player, Roger Federer won the Paris Masters. Curiously, he had never picked up the trophy in the French capital.

In the final, the world number four was up against local favorite Jo- Wilfried Tsonga, who was determined to put on a show for the home crowd, but it didn't really turn out that way. The 16-time Grand Slam winner was simply brilliant, and he broke the Frenchman's serve right away, to winning the first set 6-1.

Full credit to Tsonga, because he kept on fighting and made the second set a lot closer, a lot more interesting. But it was always Federer's match to lose. It always seemed he had the edge.

The Frenchman managed to force a tie break in the second set. However, he got off to a slow start. And a long backhand man's (ph) game, set and match to Federer, who has now won 12 straight matches on tour heading into the season ending ATP World Tour Finals here in London.

(BEGIN VIDEO CLIP)

ROGER FEDERER, PROFESSIONAL TENNIS PLAYER: I'm very happy, yes. It's been a wonderful tournament for me from start to finish. I didn't drop a set, I think, as far as I can remember right now.

But I played a great final. I started great and finished great in the breaker. So I couldn't be more happy. And what a great end to the season.

(END VIDEO CLIP)

PINTO: Let's head over to the United States, where the New England Patriots took a big step towards winning the AFC East by convincingly beating the New York Jets.

Tom Brady and co put in a great performance to New Jersey, improving to 6-3 on the season. The Pats had lost their last two games, but were too good on Sunday night. They took a commanding 23-9 lead in the third quarter. Brady finding Rob Gronkowski, who makes a great catch in the end zone.

The Jets managed to hang around thanks to this touchdown at the start of the fourth quarter. Mark Sanchez to Plaxico Burress making it a 7-point game, but that's as close as they got. Brady got back on the offensive and hooked up with Deion Branch for the score. Brady passed for 329 yards and three touchdowns.

New England then iced the game on the next possession. Rob Ninkovich picking off a pass from Sanchez, and then he runs it back 12 yards for the TD. The Patriots, coming out on top easily, 37-16.

Another season, another title for Sebastien Loeb. The Frenchman won his eighth consecutive World Rally championship on Sunday even though he didn't finish the race. Loeb had clinched the title when his closest rival, Mikko Hirvonen, crashed out on Friday of the Rally of Great Britain. Of course, he still wanted to win this competition; however, believe it or not, he ran into a higher car between stages on Sunday.

Remember, he (ph) was driving on the wrong side of the road, and you saw the result. Tough break for Loeb, but it was good news for Yari-Matti Latvala, who came out on top. The Fin easily outpaced Norway's Mads Ostberg by over three minutes for the win. Loeb, of course, still celebrating the championship victory, another one for him.

This is a big week for European football as the Final Four spots in the Euro 2012 Tournament will be decided on Tuesday. The second legs of the playoffs are taking place.

In Lisbon, Portugal will host Bosnia-Herzegovina, with the aggregate score at 0-0. The Czech Republic will take a two-goal lead to Montenegro as those two nations face off. Croatia are in a great position in their tie with Turkey, having won the first leg in Istanbul 3-0. And the Republican of Ireland are virtually guaranteed a spot in the finals as they hold a 4- goal lead against Estonia.

All of those results you see there are the aggregate scores.

That's all the sports for now.

Kristie, back to you in Hong Kong.

STOUT: Thank you, Pedro. And take care.

And coming up next on NEWS STREAM, we will take you live to Hawaii and give you the headline behind this photo at this year's Asia-Pacific Summit.

And floodwaters recede in Thailand's ancient capital of Ayutthaya, revealing the damage done to its famous temples.

Stay with us.

(COMMERCIAL BREAK)

STOUT: I'm Kristie Lu Stout, in Hong Kong.

You're watching NEWS STREAM, and these are your world headlines.

Mario Monti says he's working with a sense of urgency. Italy's prime minister-designate has been tapped to lead the country out of its debt crisis. He's putting together an emergency government two days after Silvio Berlusconi stepped down as prime minister, but parliament still has to approve it.

And official inquiry into the UK's phone hacking scandal is underway and will first examine the culture and ethics of the British press and hear from a number of celebrities whose phones were allegedly hacked. Now the judge leading the inquiry says the task can be summed up with one simple question who guards the guardians?

Well, a Norwegian judge says mass murder suspect Ander Behring Brevik will remain in custody for 12 more weeks until his trial. Brevik made his first public court appearance since he allegedly gunned down 77 people in a shooting and bomb rampage in July. Now the judge barred him from making a speech. Many victims' families attended today's hearing for their first look at Brevik.

At least seven people are dead after a huge explosion ripped through a commercial building in central China on Monday. Nearly three dozen people were injured. Now the blast was so powerful windows broke three kilometers away. The cause of the explosion is under investigation.

Now the annual Asia-Pacific economic summit has wrapped up. And leaders on 19 nations and representatives from two others met in Hawaii for a weekend of talks aimed at improving regional cooperation. Now the financial crisis in Europe and the state of the international economy were a predictable focus. And host Barack Obama called for renewed engagement with Asia saying the Pacific region is vital to the economic growth of his country. The U.S. president also prodded China on current evaluation and intellectual property rights.

Now President Obama, he ended the summit with a news conference on a host of issues. And to talk about them I'm joined now live by CNN's Dan Lothian in Honolulu.

And Dan, just how did President Obama challenge China on intellectual property and currency controls?

DAN LOTHIAN, CNN CORRESPONDENT: Well I think what you saw here is the president making sort of a careful balance. First of all, pointing out that he welcomes the rise of China, that the pressure that the U.S. has had on China and the discussions over the last few years have yielded some benefit.

But at the same time you heard a sense of frustration from the president that while he continues to be firm that there's still some big concerns with China especially over the issue of its currency. Take a listen.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Most economists estimate that the RNB is devalued by 20 to 25 percent. That means our exports to China are that much more expensive and their imports into the United States are that much cheaper.

Now there's been slight improvement over the last year partly because of U.S. pressure, but it hasn't been enough. And it's time for them to go ahead and move towards a market based system for their currency.

(END VIDEO CLIP)

LOTHIAN: And the president said that doing that is not only good for the United States, but for other countries as well. And the president suggests that it's good for China as well, because it will make them less vulnerable to the shocks of the downturn in other parts of the world.

How so? Because China relies so heavily on exporting goods, so when other countries are ailing their not importing Chinese products. So this rebalancing, the president is suggesting, is good for everyone.

On the intellectual property, that continues to be a big concern. The president hearing from some of the top CEOs of American companies who are also here talking about the fact that China continues to copy technology, able to produce it at a lower cost, thereby it puts the United States and other countries at a disadvantage.

The bottom line here, though, is that the president said during that press conference that all of these changes that the U.S. and other countries want, they realize will not happen overnight, but that the United States and the global community needs to continue to be firm with China. I think that's the bottom line coming out of this, they will continue to be firm with China until they realize some of these changes.

STOUT: Now there in the U.S. Dan, has President Obama been accused for not being tough enough on China? And do you think his words there at the APEC summit can keep his critics at bay?

LOTHIAN: Well, I think, you know, you're talking about criticism from some of the Republican candidates yet you continue to hear that the president is not tough enough on China, the president is not tough enough on Iran, you continue to hear that chorus. And certainly when you hear the words of the president, yes, it is about increasing -- or re-balancing the relationship with China. It is about creating jobs at home. But also it is a message that the president is trying to send to the American audience that in fact he is being tough and firm on China.

It's unclear whether or not what the president was able to say here in APEC will, in fact, allay some of the concerns domestically. I think his critics will still keep pounding away at the president no matter what, but he wants to take that stand and say, listen, there are some disadvantages here. We don't think that China is playing fair. And the U.S. is not going to stand for it.

STOUT: Dan Lothian live in Honolulu, thank you very much for that.

Now as Thailand fights months of flooding, some residents in Bangkok are fighting mad. They say their homes are underwater, because flood defenses protecting the city center are causing water to pool in their neighborhoods. Now these people are near one of those flash points. As you can see the water, it comes up to their chests.

And the Thai government says some 22 provinces are still affected by the flooding, but there has been visible improvement in some areas, including Ayutthaya. Liz Neisloss takes us there.

(BEGIN VIDEOTAPE)

LIZ NEISLOSS, CNN INTERNATIONAL CORRESPONDENT: Cleaning up an ancient site: the might elephant, long a part of this landscape, now a valued partner in the effort to bring Ayutthaya back to life and bring back the tourists. For the past two months this former capital, once home to Thai kings and more than 100 temples, has sat deep in flood waters. The tops of these prized ruins reaching up.

The long soak may have done irreparable harm.

"Temples made of brick under the water will be affected," this director explains. "The foundation submerged for a long time could collapse and the quality of the brick changes so it softens."

The problem here in Ayutthaya echoes the dilemma facing many other cities across Thailand. Over time, natural drainage has been sealed off.

"The water drainage from north to south of Ayutthaya has changed. And it is not as effective as in the old days."

Strewn souvenirs, evidence the nearby tourist center was also swamped.

REANGTHONGBAHT MEEPAN, AYUTTHAYA ELEPHANT PALACE WORKER: It's completely damaged. The level of the water is about my height. So this is about 175 centimeters.

NEISLOSS: The flood silt is being scraped. And there's a fresh coat of paint for the place where tourists come to enjoy elephant rides.

On this day, groups of Japanese, Germans, and French meander the still soggy ground.

"We were afraid we wouldn't be able to visit all the interesting sites, because we had been told they were flooded. And for example that we wouldn't be able to see Ayutthaya. That would have been a shame."

The flooding is nowhere near over for Thailand. Nearby Ayutthaya's major industrial states are still underwater. And central Bangkok is still under threat.

But the picture emerging here, bringing order after chaos, one of hope.

The elephants once helped build this nation. Thais say seeing the elephants clearing out the flood debris offers the promise of renewal for the nation.

Liz Neisloss, CNN, Ayutthaya, Thailand.

(END VIDEOTAPE)

STOUT: Now let's get the latest forecast for Thailand. Tom Sater joins us from the world weather center -- Tom.

TOM SATER, CNN WEATHER CORRESPONDENT: Well, Kristie, there's some good news as mentioned there in your story about the waters receding to the north. Bangkok is still putting up with its flood waters. And they're doing everything they can as far as diverting the water. Forecast quickly for you.

In the satellite picture, showing you a pleasant news here, very good news, as most of the rainfall will be suppressed, kind of held down to the south. But you notice here, right here in the Gulf of Thailand, we're looking at high tide still. And with the rainfall staying out of the area, that's good news, but it follows the lunar phases. You can see how the rain stays a little bit extreme southern Cambodia.

But the lunar phases, we watch the high tides. We've had two of them in the last 24 hours. The last just a couple of hours ago at 5:33 only at 2.99 meters. Although, at 8:37 am we've got another one.

When you have the high tide, it keeps the water from flowing freely out into the Gulf. Also the Chao Phraya River starts to see a little bit of an increase in arise. But as the flood waters start recede well to the north, that just means the mass of it really heading into around the surrounding provinces of Bangkok.

50 districts in Bangkok, eight considered serious flooding, another seven have flooding not as serious, but the big story now is the mass of the water really to the north and to the northwest. And it's free flowing. The natural flow is to the south, into the Gulf.

But the only open highway now Rama II road, that thousands took about two weeks ago to exit Bangkok runs the risk of being flooded. They talked about this for a week now. Officials say they will not try to increase the defenses here. They will not create a barricade. They're going to let the water most likely ride over this. Already, reports of water one meter high just to the north of Rama II Road.

Some engineers are speculating that we could have some structural damage, but more importantly this will cut off everything in and out of Bangkok. They're doing everything they can to open up Highway 340, special number nine with pumps and stuff like that. But they're also looking at, officials are saying, passing a fuel bill for power votes just so they can help drive the water through some of these canals and help it flow a little bit better.

At least we've got dry weather in the forecast for the next several days. We'll continue to watch those flood waters as they come pretty close to Rama II. Again food, water, provisions, medical supplies very important to keep that route open.

Here's the bigger story, this is where the rain is falling in the Philippines. Reports of 40, 50, 60 millimeters of rainfall. The Joint Typhoon Warning Center giving us a low risk to really develop. We'll watch it in the future cast. See a little area of low pressure kind of make its way very quickly as it makes its way into the South China Sea. We'll monitor it for you.

But the bigger story even if it doesn't become anything tropical, it still has quite a bit of rain for it. Manila is looking at least 200 to maybe 275 millimeters. So the bigger story with rain is toward Manila and the Philippines.

But at least some good news with the water receding in Thailand.

Back to you, Kristie.

STOUT: All right. Good to hear. Tom, thank you very much indeed.

Now two cosmonauts and an American astronaut are on their way to the International Space Station. They blasted off from a very snowy Kazakhstan Monday morning. And this launch is notable for a few reasons. Now it is the first to ferry an American since the end of NASA's shuttle program. And it ends a string of mishaps for Russia's space program. Last week, Moscow's Mars probe failed to reach proper orbit. And back in August, an unmanned spacecraft crashed. That led to a delay of this launch and raised fears the ISS would have to be abandoned.

Now still to come here on News Stream, troops storm one of Rio de Janeiro's biggest slums hoping to drive out drug gangs.

(COMMERCIAL BREAK)

STOUT: Welcome back.

Now we have this news just in, Jordan's king has called on Syrian president Bashar al Assad to step down. Now King Abdullah told the BBC, quote, "if I were in his shoes I would step down."

Now Jordan's king is just the latest to pile pressure on the Syrian president after the country's crackdown on protesters. The Arab League is suspending Syria because of the unrest. Now the protests began eight months ago, and according to the UN have killed more than 3,500 people.

Now let's go to Brazil next where 3,000 police and security forces have taken control of one of Rio's most notorious shanty towns. Now the operation is part of an effort to crack down on violent crime before Brazil hosts two high profile sporting events. Now Shasta Darlington has more.

(BEGIN VIDEOTAPE)

SHASTA DARLINGTON, CNN CORRESPONDENT: Armored personnel carriers roll in and helicopters fly overhead. An astonishing invasion of enemy territory in the heart of Rio de Janeiro. In a pre-dawn raid on Sunday, hundreds of police and military took over Rocinha, Rio de Janeiro's biggest shantytown, resting control from the city's bloody drug gangs according to officials without a single shot being fired.

3,000 troops, including 200 navy commandos, participated in the operation which lasted just two hours. Police hoisted their flag over the hilltop Favela and declared they were in full control of Rocinha and neighboring slums where 120,000 people live.

"We're hopeful," says one resident. "We were scared that the police were coming in and there were going to be shots fired. But now we're relaxed. No more fear."

The massive operation is part of Rio's efforts to eliminate crime and end the reign of drug traffickers before the 2014 World Cup and the Olympic games two years later.

It's a historic day in Brazil, says Rio governor Sergio Cabral. And very emotional for all those who live in Brazil, especially for those who live in Rio.

Police have already pacified dozens of Favelas. But it's an uphill battle. About one-fifth of Rio's residents live in the city's 1,000 Shantytowns, perched on steep hills overlooking beach side condominiums. Last year, more than 30 people were killed during a similar invasion on another Favela. This time around, police arrested Rocinha's top drug trafficker days before the operation. They found Antonio Francisco Bonfim earlier this week in the trunk of a car. On Sunday, police captured automatic weapons, grenades, and plenty of drugs.

Now the hard work begins. Police have to set up a permanent presence to keep traffickers out and convince residents that after decades of neglect they won't abandon them.

Shasta Darlington, CNN, Sao Paolo.

(END VIDEOTAPE)

STOUT: Now let's take a closer look at Rio de Janeiro's Favelas now. Shit is what Rocinha looks like on Google Earth. It's a sprawling hillside community. And you can see just how densely packed the buildings are, especially if you compare it with the more affluent neighborhoods on either side of the shanty town where you see more substantial homes and more green space.

As Shasta said, Rocinha is home to some 120,000 people. That makes it the largest Favela in the city. But it's only one of 1,000 dotted around the outskirts of Rio.

Now let's take you to another one now, Alemao. And from the aerial view it looks simply like a mass of rocks nestled against a green hill. But zoom in, and the labyrinth of alleyways, shacks, and stores becomes more clear.

And take a look at this, Alemao even has a cable car stretching for three-and-a-half kilometers above the shantytown offering alternative transport to the 85,000 people who live there.

Now they call themselves the 99 percent, Occupy Wall Street protesters have been camped out in New York City's Zuccatti park for nearly two months now. So where is the movement getting the money to feed and shelter them?

Now Susan Candiotti follows the money trail.

(BEGIN VIDEOTAPE)

SUSAN CANDIOTTI, CNN CORRESPONDENT: Since Occupy Wall Street, OWS, began its rallying cry against corporate greed more than 50 days ago, the movement has grown and so has its needs, including feeding hundreds camping out, providing sleeping bags for those who need them, distributing tarps and waterproof floor boards, and medical supplies.

UNIDENTIFIED MALE: Very grateful to all the donations that have come in.

CANDIOTTI: What isn't donated has to be bought. OWS released its first month's spreadsheet to CNN. The group took in nearly $455,000 and spent nearly $55,000. Quiet a balance sheet, about $400,000 in the black.

Helping to keep track is money man Pete Dutro who says his job is...

PETE DUTRO, OWS FINANCIAL WORKING GROUP: Much like having an office job in a mosh pit. It requires a lot of leg room to keep on top of receipts. And staying accurate and like making sure that each account when its open gets closed.

CANDIOTTI: Some donations are made on the spot, people walking through the park.

CHARLES SEARLES, OWS PROTESTER: It seems to come in waves. People stand around and one person sees one person and it's like a chain reaction, you know.

CANDIOTTI: Some campers help the cause by spray painting Occupy slogans on t-shirts for a donation. Cash deposits mainly go to Amalgamated Bank. OWS says it was chosen for its ethics.

DUTRO: They're a for-profit bank, but they donate all their profits to charity.

CANDIOTTI: The Alliance for Global Justice manages online donations and checks accountable to the IRS.

Some critics have raised questions because of AGJ's support of the Sandinistas, among other causes.

CHUCK KAUFMAN, CO-COORDINATOR, ALLIANCE FOR GLOBAL JUSTICE: We've been on the side of right and justice and alleviating poverty in the world.

CANDIOTTI: For Occupy Wall Street loyalists, a perfect fit for a movement that shows no signs of dying down.

Will all those donations be spent and not squandered?

UNIDENTIFIED MALE: I trust them completely. I'm not concerned at all that money is being inappropriately spent.

CANDIOTTI: What worries OWS is whether the $10,000 a day they're taking in will keep on growing.

Susan Candiotti, CNN, New York.

(END VIDEOTAPE)

STOUT: And ahead on News Stream, it's not just any old pen pal collection, we'll meet the guy who has corresponded with world leaders, some of them dictators, for decades.

(COMMERCIAL BREAK)

STOUT: Long before Twitter and e-mail there was, and still is, snail mail. And one letter writing fan has spent decades corresponding with world leaders. 81-year-old Louis Schlamowitz from Brooklyn, he has more than 6,000 letters and autographs in his collection, but his correspondence with the late Libyan leader Moammar Gadhafi is drawing the most attention.

(BEGIN VIDEOTAPE)

LOUIS SCHLAMOWITZ, PEN PAL TO WORLD LEADERS: The first one was Harry Truman. I was really surprised, because I sent a couple (inaudible). One of the fellows said you know Louis, I wish I had what you've got right now.

I wrote to him, but I signed his name in the papers and when he overthrew (inaudible) and he became the leader said I wish him well.

He sent me four pictures. He (inaudible). He kept corresponding with me three years, you know. But then I stopped. The reason why I stopped, I saw what he did. And I said to myself no shooting down a plane killing innocent people, so I didn't write to him any more, because I felt it was - - what he did was a crime against humanity.

I did write to him before he was killed. I said, if you don't do the right thing for your people and for your country, I said, and eventually the people will turn against you.

Top government officials, to be honest with you, came to my apartment drilling about anything and everything that I do. The CIA looked over my hobby. And I explained to them, you know. And they said -- they said to me, it's a hell of a hobby you have Schlamowitz.

Here's (inaudible) right here. And signed right by his ear, right over here, he doesn't sign anything. He sent it to me when he was living in the outskirts of (inaudible) as a spiritual leader before he overthrew the Shah of Iran.

This was the personal letter of President (inaudible) XIV. So I have a personal letter he sent me through the years.

I really don't admire anybody. I respect everybody, but I don't admire. I don't play no favoritism either way. And it feels good to hear from strange people that you don't know if you like (inaudible). It's very nice of them to take the time to reply back to you.

I'm nobody special, just (inaudible) and that's the way I like to be remember I leave the planet.

(END VIDEOTAPE)

STOUT: Now it has been an eye-opening tradition at APEC summits for nearly two decades now. We have enjoyed seeing world leaders wearing exotic clothing chosen by their host nations. Now then Indonesian president Soharto (ph) started the trend when he outfitted fellow APEC leaders, including then U.S. president Bill Clinton, in traditional tunics.

And then 2001, now Clinton's successor George W. Bush and Russian leader Vladimir Putin, they wore embroidered silk in China.

And then in Chile, in 2004, the delegates, they happily posed in hats and ponchos.

But at this year's summit, hosted by U.S. President Barack Obama in Hawaii, as you can see a break with tradition, no aloha shirts for the world leaders, suits and ties took center stage.

Now it is the second straight summit without leaders in local dress. Japan started this new trend in 2010. And hopefully 2012 summit host Russia will have something stylish for world leaders to wear.

And that is News Stream, but the news continues at CNN. World Business Today is next.

END