Christine Lagarde chosen to lead IMF.

French Finance Minister Christine Lagarde has been chosen to lead the International Monetary Fund . She will become the first female managing director of the global lending organization.

Lagarde's selection became all but assured when the Obama administration endorsed her earlier Tuesday. Hours later, the IMF's 24-member board voted to appoint her to the position. She had also won support from Europe, China and Russia.

I am deeply honored by the trust placed in me,'' Lagarde said in a statement after the vote. ``I would like to thank the fund's global membership warmly for the broad-based support I have received.''

Lagarde will face immediate challenges once she begins a five-year term next week.

She'll have to prod fellow European officials to take painful steps to prevent a default by Greece. She'll face pressure from emerging nations that want a greater voice at the IMF. And she'll be looked upon to restore the organization's reputation, which was tarred by a scandal involving the man she replaced.

Dominique Strauss-Kahn resigned last month after being charged with sexually assaulting a New York City hotel housekeeper. He has denied the charges.

She was chosen by consensus, the IMF said in a statement. Mexico's Agustin Carstens challenged her, but his candidacy never caught fire.

Lagarde's exceptional talent and broad experience will provide invaluable leadership ... at a critical time for the global economy,'' U.S. Treasury Secretary Timothy Geithner said.

Lagarde, 55, will be the first person to lead the IMF who isn't an economist. She led the Chicago-based law firm Baker & McKenzie before entering French politics in 2005. She speaks impeccable English and spent much of her career in the United States.

As one of the longest-serving ministers under French President Nicolas Sarkozy, she made the country's labor market rules more flexible. Forbes has listed her among the world's most powerful women.

Her appointment puts two women in prominent leadership roles at the organization. In April, Nemat Shafik, an Egyptian economist and former World Bank official, was appointed a top deputy at the fund. Shafik said last month the IMF is boosting its efforts to recruit women. The fund wants 25 percent to 30 percent of its management positions to be held by women by 2014, Shafik said.

In addition to the most recent charges, Strauss-Kahn was reprimanded in 2008 for having a brief affair with a subordinate, though he faced no disciplinary action.

Lagarde told the IMF's board last week that the managing director ``has to lead by example.'' She promised to ``restore staff pride in working at the IMF'' as part of a "healing process.''

Lagarde will be expected to help stabilize Europe's debt crisis.

That's likely one reason why even some developing countries, such as China, supported her candidacy, Lombardi said. China owns billions of dollars in euro-dominated bonds and has little interest in seeing the European debt crisis worsen.

Congress moves forward on free trade deals

The Senate will officially take up three trade deals and a scaled-back version of a jobs retraining program for laid-off workers on Thursday.

Senate negotiators will have to start pounding out the details of the trade deals, as well as

funding for the jobs retraining program -- whose funding ran dry in February.

"This was truly a bipartisan negotiation on all sides ... we think this is a strong package that reflected the different priorities," said one senior administration official on a call with reporters Tuesday.

But final passage on all the measures is not a done deal. Republican support depends on how closely the trade deals and jobs retraining program are linked together.

Republicans want to vote on the trade pacts, and have agreed to consider the new compromise that would extend the jobs retraining program, according to congressional aides. But they refuse to have the issues stuck together on the same bill, in a way that would prevent them from making changes to the jobs retraining program.

"I would strongly urge the Administration to re-think this action, and urge them to send up all three pending trade agreements without delay -- and without extraneous poison pills included," said Senate Minority Leader Mitch McConnell in a statement Tuesday.

If Congress were to pass the trade pacts without the jobs retraining program, President Obama would face a tough choice as he had previously said he couldn't have one without the other.

At issue is the Trade Adjustment Assistance program, which got a big funding boost with the 2009 economic Recovery Act.

The program gives unemployed workers financial help and job training when employers move jobs overseas. White House officials had previously said that more than 435,000 workers would be eligible for the program if it were reinstated. But Republicans have said they are concerned about funding such stimulus programs, because of the big deficits the nation faces.

A White House official outlined a compromise made on the program, saying it would be scaled back. He added that it wouldn't add to the deficit, thanks to cuts in unemployment insurance; and due to a new proposal that would penalize tax preparers who have "bad records," claiming tax credits for those who don't qualify.

But the White House couldn't give a final tab on Tuesday for the scaled back Trade Adjustment Assistance program.

An additional roadblock is that even though House Ways and Means Chairman Rep. David Camp was involved in the compromise, it's unclear whether even a scaled-back version could pass the GOP-controlled House

"We're pleased the President may finally send us the three job-creating trade agreements we've requested, but we have long said that TAA -- even this scaled-back version -- should be dealt with separately from the trade agreements," said Brendan Buck, spokesman for House Speaker John Boehner.

The one thing many congressional Republicans and Democrats can agree on is wanting to pass the trade deals to help boost the U.S. economy, particularly since some say the treaties could add as many as 250,000 jobs.

Despite Obama's effort to tie the trade pacts to something the unions want, the AFL-CIO and other labor groups continue to oppose the treaties -- which they say don't do enough to protect workers' rights.

But business groups from the U.S. Chamber of Commerce to the Business Roundtable applauded the move forward.

"With our economic recovery stalling, the time is now for Congress to act on these deals," said Thomas J. Donohue, president and CEO of the U.S. Chamber. "We simply cannot afford to put American jobs at risk any longer."

"Probably inevitable" a country will exit euro: George Soros

Billionaire investor George Soros thinks a country will eventually exit the euro zone and urged policymakers on Sunday to come up with a "plan B" that could rescue the European Union from looming economic collapse.

Soros, famous for making $1 billion by betting against the British pound in 1992, did not name any country he thought might exit the currency, but speculation is mounting about the fate of Greece as its politicians struggle to agree more austerity measures demanded by international lenders as the price for staving off bankruptcy.

Soros reiterated his view in a panel discussion in Vienna that the euro had a basic flaw from the start in that the currency was not backed by political union or a joint treasury.

"The euro had no provision for correction. There was no arrangement for any country leaving the euro, which in the current circumstances is probably inevitable," he said.

While he called survival of the European Union a "vital interest to all," he said the EU needed structural changes to halt a process of disintegration.

"There is no plan B at the moment. That is why the authorities are sticking to the status quo and insisting on preserving the existing arrangements instead of recognizing there are fundamental flaws that need to be corrected."

With a debt crisis in some peripheral members testing the EU's cohesiveness at a time of popular disquiet in wealthier countries over bailouts, he said leaders had to adopt measures now to remedy the situation.

"Let's face it: we are on the verge of an economic collapse which starts, let's say, in Greece but could easily spread. The financial system remains extremely vulnerable...

"We are on the edge of collapse and that is the time to recognize the need for change."

Some steps the EU could adopt included creating a larger central budget; directing some of the income from value-added tax or a levy on financial transactions to Brussels; having a European institution guarantee banks, and tripling the size of its bailout fund by topping it up with tax revenue, he said.

Insiders Sound an Alarm Amid a Natural Gas Rush

Natural gas companies have been placing enormous bets on the wells they are drilling, saying they will deliver big profits and provide a vast new source of energy for the United States.

But the gas may not be as easy and cheap to extract from shale formations deep underground as the companies are saying, according to hundreds of industry e-mails and internal documents and an analysis of data from thousands of wells.

In the e-mails, energy executives, industry lawyers, state geologists and market analysts voice skepticism about lofty forecasts and question whether companies are intentionally, and even illegally, overstating the productivity of their wells and the size of their reserves. Many of these e-mails also suggest a view that is in stark contrast to more bullish public comments made by the industry, in much the same way that insiders have raised doubts about previous financial bubbles.

“Money is pouring in” from investors even though shale gas is “inherently unprofitable,” an analyst from PNC Wealth Management, an investment company, wrote to a contractor in a February e-mail. “Reminds you of dot-coms.”

“The word in the world of independents is that the shale plays are just giant Ponzi schemes and the economics just do not work,” an analyst from IHS Drilling Data, an energy research company, wrote in an e-mail on Aug. 28, 2009.

Company data for more than 10,000 wells in three major shale gas formations raise further questions about the industry’s prospects. There is undoubtedly a vast amount of gas in the formations. The question remains how affordably it can be extracted.

The data show that while there are some very active wells, they are often surrounded by vast zones of less-productive wells that in some cases cost more to drill and operate than the gas they produce is worth. Also, the amount of gas produced by many of the successful wells is falling much faster than initially predicted by energy companies, making it more difficult for them to turn a profit over the long run.

If the industry does not live up to expectations, the impact will be felt widely. Federal and state lawmakers are considering drastically increasing subsidies for the natural gas business in the hope that it will provide low-cost energy for decades to come.

But if natural gas ultimately proves more expensive to extract from the ground than has been predicted, landowners, investors and lenders could see their investments falter, while consumers will pay a price in higher electricity and home heating bills.

There are implications for the environment, too. The technology used to get gas flowing out of the ground — called hydraulic fracturing, or hydrofracking — can require over a million gallons of water per well, and some of that water must be disposed of because it becomes contaminated by the process. If shale gas wells fade faster than expected, energy companies will have to drill more wells or hydrofrack them more often, resulting in more toxic waste.

The e-mails were obtained through open-records requests or provided to The New York Times by industry consultants and analysts who say they believe that the public perception of shale gas does not match reality; names and identifying information were redacted to protect these people, who were not authorized to communicate publicly. In the e-mails, some people within the industry voice grave concerns.

“And now these corporate giants are having an Enron moment,” a retired geologist from a major oil and gas company wrote in a February e-mail about other companies invested in shale gas. “They want to bend light to hide the truth.”

Others within the industry remain optimistic. They argue that shale gas economics will improve as the price of gas rises, technology evolves and demand for gas grows with help from increased federal subsidies being considered by Congress. “Shale gas supply is only going to increase,” Steven C. Dixon, executive vice president of Chesapeake Energy, said at an energy industry conference in April in response to skepticism about well performance.

Studying the Data

“I think we have a big problem.”

Deborah Rogers, a member of the advisory committee of the Federal Reserve Bank of Dallas, recalled saying that in a May 2010 telephone call to a senior economist at the Reserve, Mine K. Yucel. “We need to take a close look at this right away,” she added.

A former stockbroker with Merrill Lynch, Ms. Rogers said she started studying well data from shale companies in October 2009 after attending a speech by the chief executive of Chesapeake, Aubrey K. McClendon. The math was not adding up, Ms. Rogers said. Her research showed that wells were petering out faster than expected.

After being evicted, Ramdev to be back in Delhi

Yoga guru Baba Ramdev, who was forcibly evicted from Delhi’s famous Ramlila Maidan after sitting on a fast-unto-death against black money, is returning to the national capital on Sunday.

Ramdev, whom the government had barred from entering the national capital for 15 days, will be here to meet Raj Bala, a supporter of the yoga guru who got injured during the police action against fasting Ramdev and his thousands of supporters earlier this month.

The condition of 51-year-old Raj Bala, who is undergoing treatment at the GB Pant Hospital here, is still critical.

Raj Bala, a resident of Gurgaon, had undergone surgery on June 05 for cervical spinal injuries. According to doctors, the neurological status of Raj Bala remains unchanged and she is a quadriplegic (paralysis caused by illness or injury).

While officially it is being said that Ramdev is coming to Delhi to see his ailing supporter, sources say the yoga guru is travelling to the capital to give the Central government a message, that he might be down but not out.

Business Group Slams Obama Over Oil Release

Washington's most powerful business lobby panned the Obama administration's decision to tap the nation's strategic oil reserve Thursday, calling the move "ill-advised."

"Our reserve is intended to address true emergencies, not politically inconvenient high prices," Karen Harbert, CEO of the U.S. Chamber of Commerce Energy Institute, said in a statement.

The U.S. Department of Energy said it would release 30 million barrels of oil from the Strategic Petroleum Reserve to alleviate Libyan supply disruptions. Other nations will contribute an additional 30 million barrels.

The U.S. Chamber of Commerce is the voice of big business in Washington's hallways of power, and the group hasn't always been on friendly terms with the administration.

Energy policy has been a particularly sticky point. The Chamber favors an increase in domestic energy production, including off-shore drilling, and has asked the Obama administration to expedite drilling permits and leases.

Harbert called tapping the reserve "dabbling around the edges" of energy policy, and said the move was "not the signal the markets need."

"Unrest in the Middle East is likely to continue for quite some time, so a temporary increase in supply is not a substitute for a long-term fix," she said.

Asked during a conference call with reporters about the timing and political implications of the decision to tap the reserve, senior White House officials demurred, allowing only that the move is a response to an oil supply shortage.

"We're not making predictions about market prices, which go up and down .... The prices will be what they are," said a senior administration official who refused to be identified.

The administration has long maintained it was willing to tap the 727 million barrel strategic reserve if specific conditions were met, and officials said they had been working for months with International Energy Agency member nations on the issue.

Obama to business: Let's work together

Officials on Thursday pointed to the drawn out nature of the Libyan disruption as the driving force behind tapping the reserve. The IEA estimated that the unrest in Libya removed 132 million barrels of light, sweet crude oil from the market by the end of May.

But the total amount that will be released to ease supply troubles -- 60 million barrels -- is less than one day's worldwide oil consumption.

In March, Obama said his administration was not tapping the reserve because there was no supply shock and other countries would fill the production gap.

"Right now, what we're seeing is not a shortage of supply," Obama said, before adding that, "even if Libyan oil production was suspended for a significant period of time because of the unrest there, we'd be able to fill that gap."

Many analysts were expecting OPEC to increase production earlier this month in response to the Libyan shortfall, but a decision to do so could not be reached.

USA Release Oil From Strategic Reserve

The U.S. Department of Energy said it will release 30 million barrels of oil from the Strategic National Reserve to alleviate Libyan oil supply disruptions, in the midst of already-plummeting oil prices.

The U.S. release is part of a 60 million barrel increase in supply announced Thursday by the International Energy Agency, which includes the U.S. as one of its 28 member nations, "in response to the ongoing disruption of oil supplies from Libya."

The U.S. Energy Department said the reserve is at the "historically high level" of 727 million barrels.

"We are taking this action in response to the ongoing loss of crude oil due to supply disruptions in Libya and other countries and their impact on the global economic recovery," said Energy Secretary Steven Chu. "As we move forward, we will continue to monitor the situation and stand ready to take additional steps if necessary."

Meanwhile, Libya is still locked in civil war, as rebels aided by NATO airstrikes try to unseat Mohammar Gadhafi.

Oil prices fell more than 4.5% Thursday, as investors signaled disappointment over a bummer of a speech by Fed chief Ben Bernanke.

Oil prices plunged $4.71 to $90.89 per barrel. Prices edged down about 1.5% in Wednesday's session following Bernanke's speech.

Federal Reserve Chairman Bernanke issued a gloomy forecast of the economy on Tuesday, triggering a stock decline of 0.7% on Wall Street.

"Bernanke's statement about the 'slowing pace of recovery' was the key to this down move," said Dan Dicker, former oil trader and author of "Oil's Endless Bid: Taming the Unreliable Price of Oil to Secure Our Economy."

Fed Reserve gloomy on economy

In particular, he highlighted the stagnant job market and the potential impact of the Greek fiscal crisis. He projected that unemployment would "come down very painfully and slowly."

Dicker said that oil prices were also "under pressure from growth slowdowns."

Tom Kloza, chief oil analyst for the Oil Price Information Service, said the increasing value of the U.S. dollar is also "putting downward pressure on oil."

He also said, "The oil futures markets is dominated by the huge institutional money managers who move tens of millions of dollars moment by moment in and out of positions in crude. Since about 3 p.m. yesterday [Wednesday] afternoon, they have been liquidating their long positions."