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This is a snapshot of a working day in the burgeoning world of private military companies, arguably the fastest-growing industry in the global economy. The sector is now worth up to $120bn annually with operations in at least 50 countries, according to Peter Singer, a security analyst with the Brookings Institution in Washington.

“The rate of growth in the security industry has been phenomenal,” says Deborah Avant, a professor of political science at UCLA. The single largest spur to this boom is the conflict in Iraq.

Details of the arrangement, published yesterday, revealed that the bank’s commercial paper has been entirely underwritten by the taxpayer.

Sources said the move had effectively turned billions of pounds of Northern Rock’s liabilities into gilts.

Danny Gabay, an ex-official of the Bank of England now at Fathom Financial Consulting, said: “This is a nationalisation of Northern Rock. Don’t expect the Treasury to place civil servants at the helm but, to all intents and purposes, the state now guarantees it.”

The Treasury guarantee to “cover existing and renewed wholesale borrowing which is not collateralised” is Northern Rock’s final bail-out. The lender already has at its disposal the Bank of England’s emergency funding facility and, following Wednesday’s humiliating volte-face, access to medium-term money from the central bank, which may pump as much as £40bn into the markets over the coming four weeks.
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Sheriff’s officials who participated in the stops now acknowledge that the nonprofit organization requesting voluntary DUI and drug tests from drivers was overly persistent, according to complaints.

Privacy advocates obtained database records showing that the government routinely records the race of people pulled aside for extra screening as they enter the country, along with cursory answers given to U.S. border inspectors about their purpose in traveling. In one case, the records note Electronic Frontier Foundation co-founder John Gilmore’s choice of reading material, and worry over the number of small flashlights he’d packed for the trip.

The breadth of the information obtained by the Gilmore-funded Identity Project (using a Privacy Act request) shows the government’s screening program at the border is actually a “surveillance dragnet,” according to the group’s spokesman Bill Scannell.

“There is so much sensitive information in the documents that it is clear that Homeland Security is not playing straight with the American people,” Scannell said.

The documents show a tiny slice of the massive airline-record collection stored by the government, as well as the screening records mined for the controversial Department of Homeland Security passenger-rating system that assigns terrorist scores to travelers entering and leaving the country, including U.S. citizens.

The so-called Automated Targeting System scrutinizes every airline passenger entering or leaving the country using classified rules that tell agents which passengers to give extra screening to and which to deny entry or exit from the country.

The system relies on data ranging from the government’s 700,000-name terrorism watchlist to data included in airline-travel database entries, known as Passenger Name Records, which airlines are required to submit to the government.

In a series of multibillion-dollar deals, Dubai, Qatar and Abu Dhabi reached out to acquire significant stakes in three stock markets and a U.S. private equity firm, illustrating their increasing appetite for investing the growing wealth from record oil prices in high-quality assets abroad.

But one of the deals could run into political resistance in the United States – as happened last year when DP World of Dubai was pressured to sell the U.S. port operations it had acquired as part of a larger deal.

On Thursday, Dubai – the fastest-growing financial center in the Gulf – agreed to take a stake in the Nasdaq Stock Market, which is based in New York. It would become the first government-controlled stock exchange to hold a significant stake in an American rival, prompting calls in Washington for a national security review of the Nasdaq deal.

Elena Rusalkina, the silver-haired woman who runs the institute, gestured to the center of the claustrophobic room, where what looked like a dentist’s chair sits in front of a glowing computer monitor. “We’ve had volunteers, a lot of them,” she said, the thick concrete walls muffling the noise from the college campus outside. “We worked out a program with (a psychiatric facility) to study criminals. There’s no way to falsify the results. There’s no subjectivism.”

“The key $1.40 level has been breached and dollar weakness is evident across all currency pairs reflecting the prospect of a move in interest rate differentials against the currency,” said Derek Halpenny at Bank of Tokyo-Mitsubishi.

The euro’s rise through the psychologically important $1.40 barrier – seen as pain barrier for eurozone exporters – triggered a flurry stop-loss buying, sending the single European currency higher across the board.

The euro rose 0.5 per cent to $1.4035 against the dollar and by 0.4 per cent to £0.7006 against the pound – its highest level since January 2005. It gained 0.2 per cent to Y162.20 against the yen.

Meanwhile the dollar fell 0.2 per cent to $2.0050 against the pound, 0.4 per cent against the yen to Y115.55 and 0.6 per cent to a fresh 30-year low of C$1.0090 against the Canadian dollar. It also lost 0.9 per cent to SFr1.1739 against the Swiss franc.

David Woo at Barclays Capital said as the US economy slowed down, it would become more difficult for the US to attract financing for its current account deficit.

“This increases the risk of a disorderly adjustment of global imbalances in which the dollar is likely to perform very poorly,” he said. “With euro/dollar now having broken above $1.40, the market is likely to price in this risk through higher volatility.”

Analysts said the move in euro/dollar through $1.40 would also prompt a rise in political comment on currency issues.

“With the dollar moving to some sensitive levels, currency politics are likely to return to the agenda in the last quarter of this year,” said Simon Derrick at Bank of New York Mellon.

He said that after recent comment from Nicholas Sarkozy, the French president, it would not be surprising to hear more comments from within the eurozone on the impact of the strong euro on the region’s exporters.

Meanwhile, he said tensions between the US and China were also set to rise ahead of the launch of the country’s sovereign wealth fund, which is intended to maximise returns on $200bn of China’s $1,330bn dollar stockpiles.

Analysts said the launch of the fund might speed up the diversification of China’s reserves away from the dollar, piling more pressure on the currency.

“With $200bn to play with, there will be heightened speculation on what they will spend their money on,” said Mr Derrick.

Hans Redeker at BNP Parisbas said Saudi Arabia, which is also sitting on significant dollar stockpiles, was also going to be in the spotlight since it did not follow the Fed in cutting interest rates, even though the Saudi riyal is pegged to the dollar.

He said it was understandable that Saudi Arabia was not following the Fed’s lead, given the rising inflationary pressure within its overheating and oil price supported economy, but the country would have to tighten fiscal conditions – which was unlikely to happen.