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Fannie and Freddie, now 80 percent owned by U.S. taxpayers, already have drawn $145 billion from an unlimited line of government credit granted to ensure that home buyers can get loans while the private housing-finance industry is moribund. That surpasses the amount spent on rescues of American International Group Inc., General Motors Co. or Citigroup Inc., which have begun repaying their debts.

“I call these things ‘White Guy in a Tie’ events,” a Canadian friend of a friend named Jake told me during the recruitment pitch he gave me in Beijing, where I live. “Basically, you put on a suit, shake some hands, and make some money. We’ll be in ‘quality control,’ but nobody’s gonna be doing any quality control. You in?”

Last week’s report into the banking crisis by Central Bank boss Professor Patrick Honohan revealed that minutes from the bank’s financial stability group had shown that predictions of a crash in the market were deliberately left out of a crucial report in 2006.

“It was decided in 2006 to exclude from the main text of the report data and references to a likely 15 per cent house price overvaluation that was contained in a themed research paper,” according to Prof Honohan’s report.

The explosive report entitled Assessing the Role of Income and interest Rates in Determining Irish House Prices was produced by Central Bank economists Kieran McQuinn and Gerard O’Reilly in 2006 as the housing market appeared to be booming.

The housing report is highly technical but crucially it suggests that Irish house prices were being overvalued by as much as 15 per cent.

“After 2002, the chart shows a divergence between predicted and actual prices, with actual house prices being higher than that predicted by the model.

“As of 2005 Q4, this gap is about 15 per cent,” the report warns. The bank did not publish the findings of this research in its key Financial Stability Review report for the year — its key temperature reading for the Irish economy in 2006.

It was included as one of four separate documents released with a report in November 2006.

The previously unknown deposits — including huge veins of iron, copper, cobalt, gold and critical industrial metals like lithium — are so big and include so many minerals that are essential to modern industry that Afghanistan could eventually be transformed into one of the most important mining centers in the world, the United States officials believe.

An internal Pentagon memo, for example, states that Afghanistan could become the “Saudi Arabia of lithium,” a key raw material in the manufacture of batteries for laptops and BlackBerrys.

The vast scale of Afghanistan’s mineral wealth was discovered by a small team of Pentagon officials and American geologists. The Afghan government and President Hamid Karzai were recently briefed, American officials said.

While it could take many years to develop a mining industry, the potential is so great that officials and executives in the industry believe it could attract heavy investment even before mines are profitable, providing the possibility of jobs that could distract from generations of war.

“There is stunning potential here,” Gen. David H. Petraeus, commander of the United States Central Command, said in an interview on Saturday. “There are a lot of ifs, of course, but I think potentially it is hugely significant.”

The value of the newly discovered mineral deposits dwarfs the size of Afghanistan’s existing war-bedraggled economy, which is based largely on opium production and narcotics trafficking as well as aid from the United States and other industrialized countries. Afghanistan’s gross domestic product is only about $12 billion.

“This will become the backbone of the Afghan economy,” said Jalil Jumriany, an adviser to the Afghan minister of mines.

American and Afghan officials agreed to discuss the mineral discoveries at a difficult moment in the war in Afghanistan. The American-led offensive in Marja in southern Afghanistan has achieved only limited gains. Meanwhile, charges of corruption and favoritism continue to plague the Karzai government, and Mr. Karzai seems increasingly embittered toward the White House.

So the Obama administration is hungry for some positive news to come out of Afghanistan. Yet the American officials also recognize that the mineral discoveries will almost certainly have a double-edged impact.

Instead of bringing peace, the newfound mineral wealth could lead the Taliban to battle even more fiercely to regain control of the country.

The corruption that is already rampant in the Karzai government could also be amplified by the new wealth, particularly if a handful of well-connected oligarchs, some with personal ties to the president, gain control of the resources. Just last year, Afghanistan’s minister of mines was accused by American officials of accepting a $30 million bribe to award China the rights to develop its copper mine. The minister has since been replaced.

Endless fights could erupt between the central government in Kabul and provincial and tribal leaders in mineral-rich districts. Afghanistan has a national mining law, written with the help of advisers from the World Bank, but it has never faced a serious challenge.

“No one has tested that law; no one knows how it will stand up in a fight between the central government and the provinces,” observed Paul A. Brinkley, deputy undersecretary of defense for business and leader of the Pentagon team that discovered the deposits.

At the same time, American officials fear resource-hungry China will try to dominate the development of Afghanistan’s mineral wealth, which could upset the United States, given its heavy investment in the region. After winning the bid for its Aynak copper mine in Logar Province, China clearly wants more, American officials said.

Another complication is that because Afghanistan has never had much heavy industry before, it has little or no history of environmental protection either. “The big question is, can this be developed in a responsible way, in a way that is environmentally and socially responsible?” Mr. Brinkley said. “No one knows how this will work.”

With virtually no mining industry or infrastructure in place today, it will take decades for Afghanistan to exploit its mineral wealth fully. “This is a country that has no mining culture,” said Jack Medlin, a geologist in the United States Geological Survey’s international affairs program. “They’ve had some small artisanal mines, but now there could be some very, very large mines that will require more than just a gold pan.”

The mineral deposits are scattered throughout the country, including in the southern and eastern regions along the border with Pakistan that have had some of the most intense combat in the American-led war against the Taliban insurgency.

The Pentagon task force has already started trying to help the Afghans set up a system to deal with mineral development. International accounting firms that have expertise in mining contracts have been hired to consult with the Afghan Ministry of Mines, and technical data is being prepared to turn over to multinational mining companies and other potential foreign investors. The Pentagon is helping Afghan officials arrange to start seeking bids on mineral rights by next fall, officials said.

“The Ministry of Mines is not ready to handle this,” Mr. Brinkley said. “We are trying to help them get ready.”

Like much of the recent history of the country, the story of the discovery of Afghanistan’s mineral wealth is one of missed opportunities and the distractions of war.

In 2004, American geologists, sent to Afghanistan as part of a broader reconstruction effort, stumbled across an intriguing series of old charts and data at the library of the Afghan Geological Survey in Kabul that hinted at major mineral deposits in the country. They soon learned that the data had been collected by Soviet mining experts during the Soviet occupation of Afghanistan in the 1980s, but cast aside when the Soviets withdrew in 1989.

The handful of American geologists who pored over the new data said the results were astonishing.

But the results gathered dust for two more years, ignored by officials in both the American and Afghan governments. In 2009, a Pentagon task force that had created business development programs in Iraq was transferred to Afghanistan, and came upon the geological data. Until then, no one besides the geologists had bothered to look at the information — and no one had sought to translate the technical data to measure the potential economic value of the mineral deposits.

Soon, the Pentagon business development task force brought in teams of American mining experts to validate the survey’s findings, and then briefed Defense Secretary Robert M. Gates and Mr. Karzai.

So far, the biggest mineral deposits discovered are of iron and copper, and the quantities are large enough to make Afghanistan a major world producer of both, United States officials said. Other finds include large deposits of niobium, a soft metal used in producing superconducting steel, rare earth elements and large gold deposits in Pashtun areas of southern Afghanistan.

Just this month, American geologists working with the Pentagon team have been conducting ground surveys on dry salt lakes in western Afghanistan where they believe there are large deposits of lithium. Pentagon officials said that their initial analysis at one location in Ghazni Province showed the potential for lithium deposits as large of those of Bolivia, which now has the world’s largest known lithium reserves.

For the geologists who are now scouring some of the most remote stretches of Afghanistan to complete the technical studies necessary before the international bidding process is begun, there is a growing sense that they are in the midst of one of the great discoveries of their careers.

Chimay, 47, chairman and chief investment officer of Chimay Capital Management Inc., was arrested yesterday in Wrightsville Beach, North Carolina, on a New York state warrant, said Adam Kaufmann, chief of the investigation division of the Manhattan District Attorney’s office.

The U.S. Securities and Exchange Commission sued Chimay yesterday, accusing him and his firm of fraud for touting investments he claimed were tied to the Chimay royal family of Belgium, and then stealing millions of dollars to pay his divorce lawyers and the mortgage on his house in the Hamptons on Long Island east of New York City.

“He lied to investors, took their money and used it to support his lifestyle,” Kaufmann said in a phone interview.

The SEC obtained an emergency court order to freeze the assets of Chimay and his firm.

Chimay Capital claimed to be the U.S. investment arm of the royal family based in the Chimay region of Belgium and dating to the 14th century, according to the SEC.

In a letter to congressional leaders, Obama defended last year’s huge economic stimulus package, saying it helped break the economy’s free fall, but argued that more spending is urgent and unavoidable. “We must take these emergency measures,” he wrote in an appeal aimed primarily at members of his own party.

The letter comes as rising concern about the national debt is undermining congressional support for additional spending to bolster the economy. Many economists say more spending could help bring down persistently high unemployment, but with Republicans making an issue of the record deficits run up during the recession, many Democratic lawmakers are eager to turn off the stimulus tap.

“I think there is spending fatigue,” House Majority Leader Steny H. Hoyer (D-Md.) said recently. “It’s tough in both houses to get votes.”

Workers from the Deepwater Horizon oil rig and the energy company have said that gases were leaking through the casing hours before an explosion caused a massive oil spill in the Gulf of Mexico. Investigators have said the leaks could have caused the explosion.

The casing pipe that lined the well had cement that, if it did not seal properly, would allow gas to leak to the wellhead, where there was only a single barrier, the Times said.

Using a different type of casing would have created two barriers.

The newspaper said the company decided to use the casing several days before the explosion. It was installed by the contractor Halliburton.

BP said the riskier single barrier option made the best economic case, according to the newspaper.

The undercover investigation found officials from six countries were willing to consider selling their votes on the International Whaling Commission (IWC).

The revelations come as Japan seeks to break the 24-year moratorium on commercial whaling. An IWC meeting that will decide the fate of thousands of whales, including endangered species, begins this month in Morocco.

Japan denies buying the votes of IWC members. However, The Sunday Times filmed officials from pro-whaling governments admitting:

– They voted with the whalers because of the large amounts of aid from Japan. One said he was not sure if his country had any whales in its territorial waters. Others are landlocked.

— They receive cash payments in envelopes at IWC meetings from Japanese officials who pay their travel and hotel bills.

– One disclosed that call girls were offered when fisheries ministers and civil servants visited Japan for meetings.

Barry Gardiner, an MP and former Labour biodiversity minister, said the investigation revealed “disgraceful, shady practice”, which is “effectively buying votes”.

The reporters, posing as representatives of a billionaire conservationist, approached officials from pro-whaling countries and offered them an aid package to change their vote.

The governments of St Kitts and Nevis, the Marshall Islands, Kiribati, Grenada, Republic of Guinea and Ivory Coast all entered negotiations to sell their votes in return for aid.

The top fisheries official for Guinea said Japan usually gave his minister a “minimum” of $1,000 a day spending money in cash during IWC and other fisheries meetings.

He said three Japanese organisations were used to channel the payments to his country: the fisheries agency, the aid agency and the Overseas Fisheries Co-operation Foundation.

Japan has recruited some of the world’s smallest countries on to the IWC to bolster its support. A senior fisheries official for the Marshall Islands said: “We support Japan because of what they give us.”

A Kiribati fisheries official said his country’s vote was determined by the “benefit” it received in aid. He, too, said Japan gave delegates expenses and spending money.

Witnesses speak of armed Kyrgyz men shooting ethnic Uzbeks and setting property alight.

Thousands of ethnic Uzbeks have been fleeing the city of Osh, where a BBC correspondent reports hearing gunfire.

On Saturday the interim government gave security forces shoot-to-kill powers and urged Russia to send in troops.

Moscow says it has no plans to intervene. Both Russia and the United States have military bases in the country.

Kyrgyzstan’s interim government extended a state of emergency to cover the entire southern Jalalabad region, as ethnic clashes spread there from neighbouring Osh.

President Kurmanbek Bakiyev, who was ousted in April and now lives in Belarus, has denied accusations from the government that he is involved in the unrest.

Without international assistance there are fears the interim authorities in Kyrgyzstan will struggle to contain the conflict, the BBC’s Rayhan Demytrie in Osh reports.

The south of Kyrgyzstan, an ex-Soviet Central Asian state of 5.5 million people, is home to an ethnic Uzbek minority of almost one million.

Uzbek eyewitnesses told our correspondent at a border crossing with Uzbekistan that gangs of armed Kyrgyz had been marauding through neighbourhoods, killing residents and burning homes.

One woman pleaded for help: “We need food, we need water, I have got two sons and they are little and I need water and food to survive.”

The International Committee of the Red Cross said it had received reports of tens of thousands people fleeing fighting and looting.

There have also been reports of Kyrgyz casualties.