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The ratings action affects 6,389 classes of U.S. residential mortgage-backed securities backed by first-lien subprime loans and 1,953 ratings from 572 global CDOs backed by asset-backed securities and other CDOs.

S&P’s actions on mortgage-backed securities follow its announcement on January 15 of further changes and planned changes to its methods for analyzing mortgage-backed securities and CDOs, respectively.

Earlier this month, S&P raised its expectations of losses on subprime loans originated in 2006 to 19 percent from 14 percent.

“Today’s rating actions incorporate our most recent economic assumptions and reflect our expectation of further defaults and losses on the underlying mortgage loans,” S&P said.

S&P slashed the ratings on $34.7 billion of RMBS originated in 2006 while placing another $136 billion under review for potential downgrade. In addition, S&P cut $15.4 billion of RMBS securities from 2007, while placing $34.8 billion on review for downgrade, it said. In addition, it affirmed the ratings on 1,735 RMBS classes from 2006 and 691 RMBS tranches from 2007.

The rating agency said the CDO downgrades and credit reviews were a result of RMBS credit deterioration and overall stress affecting the residential mortgage market. CDO managers were large buyers of RMBS, which they layered into their securities over recent years.

Egypt’s Telecommunications Ministry said a communications cable in the Mediterranean was cut, disrupting 70 percent of the country’s Internet network.

The ministry said in a statement it was not known how the cable was cut but that services would probably take several days to return to normal.

India reported serious disruptions to its services and one Indian Internet service provider linked the problem to the Egyptian outage.

“There has been a cable cut on several cable systems in Alexandria, Egypt which has impacted internet connectivity in India,” Videsh Sanchar Nigam Ltd (VSNL), an internet service provider, said in a statement.

VSNL said its service had been “largely restored” by diverting to another cable.

India said it had lost more than half of its capacity.

“There has been a 50 to 60 percent cut in bandwidth,” Rajesh Chharia, president of the Internet Service Providers’ Association of India, told Reuters.

He told the Headlines Today news channel that a “degraded” service would be activated by Wednesday night, but full restoration will take 10 to 15 days.

The “etc.” must mean guns.

“A few rounds over the approaching brigands’ heads would probably be a compelling persuader that there are easier farms to pillage,” he writes in his new book, “Wealth, War and Wisdom.”

The mud has long been prized by pregnant women and children here as an antacid and source of calcium. But in places like Cite Soleil, the oceanside slum where Charlene shares a two-room house with her baby, five siblings and two unemployed parents, cookies made of dirt, salt and vegetable shortening have become a regular meal.

“When my mother does not cook anything, I have to eat them three times a day,” Charlene said. Her baby, named Woodson, lay still across her lap, looking even thinner than the slim 6 pounds 3 ounces he weighed at birth.

Though she likes their buttery, salty taste, Charlene said the cookies also give her stomach pains. “When I nurse, the baby sometimes seems colicky too,” she said.

Food prices around the world have spiked because of higher oil prices, needed for fertilizer, irrigation and transportation. Prices for basic ingredients such as corn and wheat are also up sharply, and the increasing global demand for biofuels is pressuring food markets as well.

The problem is particularly dire in the Caribbean, where island nations depend on imports and food prices are up 40 percent in places.

The global price hikes, together with floods and crop damage from the 2007 hurricane season, prompted the U.N. Food and Agriculture Agency to declare states of emergency in Haiti and several other Caribbean countries. Caribbean leaders held an emergency summit in December to discuss cutting food taxes and creating large regional farms to reduce dependence on imports.

At the market in the La Saline slum, two cups of rice now sell for 60 cents, up 10 cents from December and 50 percent from a year ago. Beans, condensed milk and fruit have gone up at a similar rate, and even the price of the edible clay has risen over the past year by almost $1.50. Dirt to make 100 cookies now costs $5, the cookie makers say.

Still, at about 5 cents apiece, the cookies are a bargain compared to food staples. About 80 percent of people in Haiti live on less than $2 a day and a tiny elite controls the economy.

Merchants truck the dirt from the central town of Hinche to the La Saline market, a maze of tables of vegetables and meat swarming with flies. Women buy the dirt, then process it into mud cookies in places such as Fort Dimanche, a nearby shanty town.

Carrying buckets of dirt and water up ladders to the roof of the former prison for which the slum is named, they strain out rocks and clumps on a sheet, and stir in shortening and salt. Then they pat the mixture into mud cookies and leave them to dry under the scorching sun.

The finished cookies are carried in buckets to markets or sold on the streets.

A reporter sampling a cookie found that it had a smooth consistency and sucked all the moisture out of the mouth as soon as it touched the tongue. For hours, an unpleasant taste of dirt lingered.

Assessments of the health effects are mixed. Dirt can contain deadly parasites or toxins, but can also strengthen the immunity of fetuses in the womb to certain diseases, said Gerald N. Callahan, an immunology professor at Colorado State University who has studied geophagy, the scientific name for dirt-eating.

Haitian doctors say depending on the cookies for sustenance risks malnutrition.

“Trust me, if I see someone eating those cookies, I will discourage it,” said Dr. Gabriel Thimothee, executive director of Haiti’s health ministry.

Marie Noel, 40, sells the cookies in a market to provide for her seven children. Her family also eats them.

Alperovitch blames the government of Russian President Vladimir Putin and the political influence of operatives within the Federal Security Service (the former Soviet KGB) for the protection he says is apparently afforded to cybercrime outfits such as RBN and the Storm worm gang.

It did not identify the companies but said the investigation encompassed developers, sub-prime lenders and investment banks.

FBI officials said the agency was looking at instances of accounting fraud and insider trading.

The cases could lead to potential civil or criminal charges, the FBI said.

The FBI said it viewed mortgage fraud as an increasing threat to the national economy.

It said that there had been 1,200 cases of mortgage fraud for the 2007 financial year compared with just 400 in 2006.

The crisis in the sub-prime lending market has hit financial markets worldwide.

Joint investigation

The FBI said it was investigating the cases with the US market regulator, the Securities and Exchange Commission.

The SEC has opened about three dozen investigations into the collapse of the sub-prime market.

Targets of the SEC probe include Swiss bank UBS and US banks Morgan Stanley, Merrill Lynch and Bear Stearns, Reuters news agency reported.

It was not clear whether any of these firms were involved in the FBI investigation.

The sub-prime market is focused on providing home loans to those with poor or limited credit histories.

Many of these borrowers have been unable to keep up with payments and face losing their homes.

The wider crisis emerged as many of these mortgages were converted into financial instruments and sold on to investors including the big investment banks.

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Which is why the news that BAE Systems has delivered a functional, 32-megajoule Electro-Magnetic Laboratory Rail Gun (32-MJ LRG) to the U.S. Naval Surface Warfare Center in Dahlgren, Va., is exciting. Installation of the laboratory launcher is currently under way, and according to BAE, this is the first step toward the Navy’s goal of developing a tactical 64-megajoule ship-mounted weapon.