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(generated from captions) praise of Heath Ledger's final

performance. This town deserves

a better class of criminal.

I'm going to give it to 'em. In

America, a film usually earns

up to half of all its ticket

sales on the opening weekend

and 'The Dark Knight' broke all

records taking in almost

Australian $160 million,

surpassing 'Spiderman-3' last

year. His performance was bone

shaking, I think. Intense,

really intense. In Australia,

'The Dark Knight' had the

biggest weekend Box Office of

the year so far, raking in

almost $12 million. Bookies

around the world are now

slashing their odds for a

posthumous Academy Award for

Heath Ledger to 3:1. It's a

brilliant performance . He

really did put the work into

everything he ever did, I

think. The Joker was Batman's

first full-time nemesis and

appeared in 1940. He was based

on Conrad Veidt's character

from the 1928 silent film 'The

Man Who Laughs'. Since then,

there was Cesar Romero's

camped-up Joker. A joke a day

keeps the gloom away. Then Jack

Nicholson's more menacing

villain... Call me Joker. And

now Heath Ledger's portrayl of

pure evil. Here's my card. If

he wins an Oscar it will be the

second posthumous award. The

first went to Peter Finch for

'Network'. Christian Bale gets

top billing as the dark knight.

But all signs point to it going

down as Heath Ledger's film.

That's all from us. Lateline

Business coming up in just a

moment. If you'd like to look

back at tonight's interview

with Ali Allawi or review

Lateline's stories or

transcripts, you can visit our

website. Now here's Lateline

Business with Andrew Robertson.

Thanks, Tony. Tonight - a

higher Australian dollar pushes

down prices paid to

producers. It's been so strong,

it's seen imported prices go

backwards in the June

quarter. The market moves,

shares make their largest 1-day

gain in four months. Slowly but

surely fundamentals and

announcements come out which

allowed the fog to start

rising. And Flight Centre

predicts a bright future. In

Australia, we think there's a

number of factors that will

create opportunities for travel

agents in Flight Centre. First

to the markets and Australian

shares rose more than 3% with

the financial sector driven by

an ease in concerns about the

credit crisis. The All Ords

put on 160 points with all

major sectors in the black.

The ASX200 gained 171 points.

In Japan, the Nikkei was closed

for a national holiday. Hong

Kong's Hang Seng rose 3% to a

1-month high, and in London,

the FTSE has booked a solid


Well, there's more evidence

that the Australian economy's

slowing down. Wholesale

inflation, or the Producer

Price Index rose 1% in the June

quarter, less than expected.

Lower import prices thanks to

the higher Australian dollar

have dampened prices at the

factory and farm gates. Desley

Coleman reports. Australian

producers are feeling the pain

of a slower economy and higher

prices. Evidence of both was

reflected in the June quarter

Producer Price Index, which has

come in well below most

analysts' expectations. The

measure of wholesale inflation

monitors the average changes in

prices received by producers

for their goods. For the June

quarter, the PPI was up 1%.

Analysts had predicted an

increase of 1.6%. The slowdown

was largely driven by a fall in

the price of imports, thanks to

the stronger Australian dollar.

The annual rate slowed to 4.7%

compared to 4.8 in the same

period last year. It's been so

strong it's actually seen

imported prices actually go

backwards in the June quarter.

That is prices for things like

electronic goods and other

things that we import from,

say, South-East Asia have gone

backwards because the dollar

has outweighed any natural

price increase from goods and

services. What the Reserve

Bank wants to see is this slowdown in demand in the

economy is starting to impact

upon inflation and that's

exactly what we saw today. So

we've seen a weakening in the

housing market and we're now

starting to see a weakening in

the inflation pressures in the

residential sector. The main

drivers of the rise in the

wholesale inflation were

increased costs of

construction, meat production,

car manufacturing and the

refining of petroleum. It

filtered right through the PPI.

It's measured in terms of

final stages. We found the preliminary, intermediate and

petrol price had permeated

through all of those quite

significantly and that really

was the main reason for the

results across the

board. Economists say

Australian businesses are under

strong competitive pressure and

are prepared to sacrifice

profit margins rather than pass

on higher costs to consumers.

After the release of the

figures, investors sold off the

Australian currency and 2-year

bonds. The markets have now

pretty much dismissed the

possibility of a rate hike

through the course of this year

and that's certainly been our

view for a long time now. The

markets are now expecting the

next move will be down and

these sorts of numbers do give

them some encouragement that in

the first half of next year you

might see lower rates. We

don't expect you will. However,

inflation is likely to remain

uncomfortably high. Analysts

expect the all-important Consumer Price Index, which is

due out on Wednesday, to come

in at around 4.3% - still well

above the Reserve Bank's ideal

watchdog has launched civil range of 2-3%. The corporate

action against the founder of

fuel technology company

Firepower as the company fights

off liquidators. But Tim

Johnston is nowhere to be

found, and the Australian

Securities and Investments

Commission has asked the

Federal Court to ban him from

managing a company. Firepower

marketed a pill it said would

increase fuel efficiency, but

the technology never worked. A

former director of the Australian Trade Commission who

ran Firepower says Austrade

promoted the company without

doing its homework. You will,

in any large organisation, get

companies that slip below the

radar, but you could honestly

inadequate. Do you feel quite describe it as

responsible for that? Yes, I

do. ASIC is also pursuing

others over the failure to

provide a prospectus relating

to $60 million of shares sold

to 1400 Australian investors.

Shares rose by more than 3%

today with the market making

its biggest 1-day gain in four

months. Industrials, consumer

staples and financial stocks

led the way. For more on the

market, I spoke to George

Kanaan from UBS. George

Kanaan, welcome to Lateline

Business. Why did the market

bounce so strongly today? Look,

the market on Friday was

actually a bit weak waiting for

the Citigroup result which came

out late Friday night our time

and it actually was quite a

pleasing result, because it was

what the market was expecting.

That's what gave the market

confidence to start buying the

market again. There's been a

lot of fears over the US bank

reporting season and to a

certain extent, those fears

have been allayed for the time

being. Citigroup helped

financial stocks but the gains

today were right across the

board. What were the standouts

for you? The three sectors that

have been hit most in recent

times have been the financials,

you know, the consumer discretionary stocks and the

property trusts. And also,

some of the other down and out

industrial stocks. They're the

sectors and stocks that rallied

very aggressively today. Having

said that, the ASX200 is only

just over 5,000, so where do

you see the market heading in

the future? Look, there's been

a lot of fear with markets over

the last six month. I compare

it to a fog outside and while

the fog was around there was a

lot of fear and concerns about

market. Slowly but surely

fundamentals and announcements

come out which sort of allowed

the fog to sort of start rising

and people to get more comfort

with the outlook and start

focusing on fundamentals. So,

I think, we've got the

Australian reporting season

kicks off in a couple of weeks.

That's going to be pretty porn.

I think you'll see some

downgrades, but I think that

will prove to be a marking

point for our market. I think

you'll see the market rally out

of there and hopefully

following reporting season

you'll see more merger and

activity happen. I'm quite

optimistic about where we go

from here. From those comments

you sound unusually bullish

about the market? I'm not on

the resultings, I think stocks

have been hit so hard over the

last six months, a lot of

negative news has been priced

into a lot of share prices and,

in fact, many stocks are

pricing in Australia goes into

a hard recession. Now with the

oil price easing over the last,

you know, three or four trading

days coupled with more upbeat

comments from other companies

that have already made

comments, it makes you think

that maybe people have been far

too pessimistic to what the

actual results will be. We'll

see downgrades in commentary as

well, but it's priced in. Are

there any companies in

Australia who if they came out

with a bad result could really

shake the market? Look, this

weakness we've seen in markets

has really been a global

phenomenon. It hasn't been

really been driven by domestic

earnings kind of results. So

to be honest with you, no, but

that being said we've only got

one bank who are really

reporting, major bank reporting

this time and that's CBA. So

provided they don't come out

with some bad debts or

something like that, I really

find it hard to see how our

reporting season is going to

prove to be too disastrous. Finally, there are

more companies reporting in the United States this week, what

are you expecting? The

important thing for our global

market has really been

predominantly the companies

that have already reported.

That being Citigroup and

Lehmann. They're the two kind

of problem banks in the US and

also Merrill Lynch. The three

potential bad boys have already

reported. They are important

results but nowhere near as

important as the stocks that

have already reported. It's

going to be a normal reporting

season going on from

here. George Kanaan, thank you

for joining Lateline

Business. Thanks. To the other major movers on our market


Orica will spin off its

consumer products division and

raise up to $900 million

through a rights issue. Orica says the consumer division

which includes paint and garden

care products should become a

separately listed company early

next year. Shares are being

offered at $22.50, an 18%

discount to Orica's last traded

price. The world's biggest

explosives maker plans to merge

chemicals unit. The demerger of

consumer products and bringing

chemicals back together, we

think is going to be a very

positive generator of

shareholder value.

Particularly as the world comes

out of what has been a fairly

difficult patch in equity

market. Trading in Orica shares

has been halted pending the

completion of the issue. There

are new signs of hope within

Australia's airline industry,

which is being squeezed by

record oil prices and a sagging

global economy. Just days

after Qantas announced job cuts

its low-cost rival Tiger

Airways is adding staff. And

travel agency Flight Centre

says its before-tax results for

2008 are up 40%. Its final

figures will be released in

August. Simon Palan has more.

While the Internet makes many

of our lives easier, it's

proved a huge threat to travel

agencies as travellers book

directly themselves online.

It's caused the country's

biggest travelation Flight

Centre a few very difficult

years. Now the future looks

betterment In Australia, we

think there's a number of opportunities to create

opportunities for travel agents

and Flight Centre. Those

opportunities include a

stronger Australian dollar,

particularly against the

greenback, which is encouraging

Australians to head overseas in

record numbers. The Aussie

dollar is very good for people

who are travelling to the

United States and travelling to

parts of Asia where hotel

prices tend to be based on the

US dollar. Flight Centre today

flagged a 40% increase in

before-tax profit for the 2008

fiscal year, that will take

earnings to around $212 moan.

The company reaffirmed

predictions of higher profits

in 2009. The market was

impressed. Very positive coming

off a whole lot of bad news

about Flight Centre last

year. And Flight Centre shares

today closed almost 12% higher.

A positive outlook also from

Tiger Airways, the budget

airline is creating new

positions at its Australian

headquarters in Melbourne. We

are starting recruitment for an

additional 60 flight and cabin

crew to operate the three

additional aircraft that we'll be bringing to Australia

towards the end of the

year. Tiger's also announced

that heavy maintenance checks

on its Airbus aircraft will be

carried out in Melbourne. It's

a distinctly different

sentiment to that of Qantas,

which is slashing 1500 jobs and

alluding to tough times ahead

thanks to record jet fuel

prices. Analysts fear Qantas

may be being too pessimistic at

a time when international

rivals such as Cathay Pacific and Singapore Airlines are

increasing their flights into Australia. So, I think, what

we're going to see is a shift

towards much more activity with

those foreign carriers and them

taking a bigger market share in

the Australian market than

Qantas. Peter Harbison says the

country's second largest

airline Virgin Blue is taking a

cautious approach by

introducing baggage fees and

reducing flights. In 1987

economic forecaster Marc Faber

told clients to get out of the

stock market one week before it

crashed. Ten years later he

was ahead of the game again

when he predicted the Asian

financial meltdown. Mr Faber

is based in Hong Kong and

publishes what's known as the 'Gloom, Boom and Doom Report'

and, in fact, he's known as Dr

Doom because of the his bearish

predictions. His track record suggests he's someone who

should be listened to. He's in

our Melbourne studio now. Marc

Faber, welcome to Lateline

Business. Good evening. Well,

you really lived up to your

nickname today with a speech in

which you said the global

outlook will include

outlook will include sphag

flation - how bad is it going

to get? I think if you look

back over the last 25 years, we

were very much in a period of

accelerating credit growth

thanks to GDP and the US

increase in particular in the

last seven years. We had

accelerating credit growth

until 2007 and that drove all

asset prices up and it led to

US overconsumption, to the

build-up of the trade and

current account deficit. Now

what has changed is lending

standards have tightened and

credit growth has collapsed.

It's still growing, but no

longer at 12% per annum, but

only at around 4%, per annum

and that usually leads to some

equalibrium in the system and serious disturbances in the

in my opinion, will have a

global recession after the

synchronised global boom we had

over the past five years. How bad do you think that recession

will be? Well, you don't want

to know. Yes we do, that's why

I asked you? I think it will be

quite bad. Because if you look

we had an incredible global

boom. If you travelled around

the world six months ago,

everywhere we had boom

conditions and now in the US

housing has started to go down

meanfully in some areas we're

down 30%. In Las Vegas,

business is down. We have

businesses that have

contracted, so the imports into

the United States will slow

down. This will have an impact

on the Chinese export

industries and as China then

slows down it will have an

impact on the raw material

producers of the world, the

demand for commodities will

probably no longer expand. It

will lead to some discomfort

among the commodities producers

and among the export industries

of Europe and Japan. I think

it will be quite bad, yes. When you say raw material producers,

of course, Australia is one of

the biggest. So you're

suggesting that Australia will

be hit hard? Well, I think that

Australia will also get hit for

two reasons. First of all,

household balance sheets are

not in a good position. The

typical Australian household is

very leveraged, is highly

geared and the property market

here is in for, in my opinion,

quite a serious downturn. And

so, I think, the Australian

economy will be hit actually

quite hard. You think a

downturn of US-style housing

slump type proportions? Yes,

could be larger. Well, we have,

as you would know, what's

loosely called a 2-speed

economy. Where do you see this

slowdown hitting hardest, is it

the eastern States or the west

of the country which is based

on commodity exports? Well, I

think that if you look at, say,

prices in Sydney and in

Melbourne they would seem to me

to be on the high side. And,

of course, obviously if

commodity prices come down then

the property market in Perth

will also ease and possibly

quite considerably. So, I

think, it could be nationwide.

Now in which village the price

of a property will drop the

most and in which corner of the

city they will drop less that I

don't know, I'm not a

specialist on Australian

property prices. But just

looking at property prices in

Anglo-Saxon countries, whether

it's the UK, Ireland or

Australia or the US, I think

they're vulnerable everywhere.

And by the way, everywhere in

the world. A lot of people here

talk about decoupling and the

fact that the world is very

different now since the last US

recession and a lot of people

here believe China will

insulate us from any large-scale US slowdown.

Clearly from what you've said

tonne, you don't believe in

that? Well, I think that the

connect alternative ity in --

connectivity in trade flows has

increased and if you look at how financial stocks behaved

after the summer of 2007, then

we certainly didn't have a

decoupling in financial issues

around the world. All

financial stocks went down and,

I think, the global economy is

very closely connected and

linked through trade flows,

through capital flows. And I'm

not a great believer in this

decoupling theory. This is

another invention of the

Goldilocks crowd. Well, given

that gloomy scenario you've

been painting, the governor of

the Reserve Bank of Australia

has indicated that in the

current economic conditions the

fight against inflation is more

important than ever. Whereas

in the United States, the

Federal Reserve's focus now

seems to be on kick starting

the economy. Who do you think

is right? I have to give credit

to the Reserve Bank of

Australia for pursuing a very

responsible monetary policy,

whereas in the US we have a

money print er who pursues

misguided economic policies and

misguided monetary policies.

He has now again slashed the

Fed fund rate to 2% when the US

rate of inflation is probably

in the neighbourhood of between

6 and 10% per annum at the

present time. So you have

interest rates adjusted for

inflation and that by itself

is, of course,

inflationary. Well, we saw last

week the official figure was, I

think, 5%, should the Fed be

raising interest rates and by

not doing so, is it creating

conditions for

stagflation? Well, if you look

at the problems in the

financial service s industry,

it's a direct consequence of

ultra expansionary policies of

the US Federal Reserve that

allowed essentially debt growth

to accelerate, and the leverage

to go to the extent it went in

the US banking system. And now

that the banking system has a

problem, the Fed tries to solve

the problem with the medicine

that created and problems in

the first place. The monetary

policy in the United States

doesn't make any sense at

all. Just on - you mentioned

the banking system, just on

that, in the last week we've

celebrating what are really seen the stock market

quite awful results. What does

that say about where we're at

at the moment? Well, basically

over the last 18 months, say,

from the start of 2007 until

now the weakness in the market

in the US has been principally

concentrated in financial

stocks. And a lot of financial

stocks dropped by 90%, some by

100%, some by 95%. And as of a

week ago, a the entire market

had become extremely oversold

from a technical point of view

and the banking shares and

financial shares such as fanny

Mae and Freddy Mac were

extremely oversold and they had

very large short positions -

don't forget that. Now they

changed the rules, or they made

some proposal to change the

rules about naked short selling

that then motivated the short

sellers in financial stocks to

cover. And that's why some

financial stocks such as fanny

Mae, they doubled from the

lows. But never mind double

from the lows, they're still

down close to 90% from the

high. So you can have very strong performances in

financial shares for a couple

of days with financial shares

rebounding 30, 40% in some

cases maybe even 50 to 100%.

It could still drift down again

and, I think, in this period of

deleveraging and with the lack

of transparency among financial

institutions, because they

report earnings but nobody asks

exactly how they fiddle around

and get to these earnings

because they shift assets

around from level 1 to level 2

to level 3. In level 3 you

don't need to value your

assets. So you can essentially

massage your earnings as you

like when you're a bank. Can I

just ask you very briefly, is

the Federal Reserve and other

regulators right to bail out

these banks? Not in my opinion.

What should happen is basically

that the people that were

running these financial

institutions are responsible

and the shareholders that own

the shares and the bond holders

of these institutions, they

should take the hair cut and

not the taxpayer, the simple

man on the street bailing out

the rich kids on Wall

Street. You've painted a very

gloomy economic picture

tonight, when's the recovery

coming and how long is it going

to take? I think we'll have to

wait for that for quite some

time. But in general, even if

I'm wrong, I'd like to make the

following point, even if I'm

wrong and the economy continue

to expand, the big change that

has occurred in the world is

that we moved from an

environment of falling

commodity prices and falling

interest rates and disinflation

between 1980 and 2001 to an

environment where now prices

are going up. So if the global

economy continues to expand, I

assure you that commodity

prices will continue to go up

and that inflation will

accelerate and that interest

rates will go up. And as a

result of that, even if the

scenario is very optimistic, I

don't think that equities will

perform particularly well,

simply because liquidity will

tighten and interest rates will

go up. So in any event, I wun

buy necessarily equities at the

present time. I think for the

next 10-15 years, equity prices

will kind of move side wards,

up and down, volatile, in a

volatile fashion, but the big

bull market in financial assets

is over, in my

opinion. Alright, Marc Faber, thank you very much for your

time and insight. It's my

pleasure. Australia's largest

department store Myer plans to

open its first overseas shop in

Dubai next year. The retailer

has teamed up with the ruling

team of the United Arab

Emirates to open a store in a

new shopping mall in Dubai. It

has plans for four other shops

in the gulf State and obl

eastern Europe. Dubai's such a

fantastic market from our point

of view. There's a very good

GDP. It's got a multifaceted

economy, which means that it's

not only dependent on oil, but

there's a large degree of

tourists. The boards of both

companies are expected to

approve the deal by September.

Now a look at tomorrow's

business diary, which is

dominated by mining production

reports, among them Oxiana's

last production report before

the merge with Zinifex.

A look at what's making news

in the business sections of

tomorrow's newspapers.

News just out, continued

subprime losses and a slowing

US economy has seen the Bank of

America post a 41% fall in

profit to $3.5 billion.

Despite its fourth consecutive

quarterly loss, they beat

expectations, sending its

shares up 8% in pre-market

trade. That's all for tonight.

The Dow Jones futures are up 38

points and the FTSE in London

has gained 49 points. Thanks for watching, I'm Andrew

Robertson, goodnight.

Closed Captions by CSI

Saudi Arabia. In just 50 yrs, it has evolved from a tribal community into a world power. You have Saudis riding BMWs, having mobile chips but his mind is still of someone in a tent. We didn't go through cultural development.

To most of the world it is a society shrouded in secrecy where women need permission just to leave their homes. The real secret is that Saudi women are playing a vital role in the country's reform. But is equality possible in the most conservative Muslim country in the world? Our camera takes you inside Saudi Arabia for an unprecedented look at the women of the Holy Kingdom. Saudi Arabia is a kingdom in transition

caught between tribal traditions and the 21st century. On one hand, it is the world's largest producer of oil, a modern power. On the other, it is the world's most conservative Muslim nation mired in 13th-century ideals. (Call to prayer) It is the birthplace of Islam and site for the two most sacred sites for Muslims, Mecca and Medina. The royal family of Saud has ruled Saudi Arabia since 1933. The monarchy uses the Koran as its constitution

and seeks guidance from religious clerics when passing new laws.

(Chants) My name is Sharmeen Obaid Chinoy. Although I am Muslim, I was raised in a progressive Islamic society in Pakistan. I have witnessed a clash between the traditions of Islam and modern life in my own country and I wanted to see how Saudi society was adopting these changes. In recent years the royal family has been implementing reforms, experimenting with democracy, improving the educational system and granting more rights to women. But the religious clerics and even many Saudi citizens have been hesitant to accept these changes. For me, the changing role of women provided the most dramatic way to examine the conflict between the royal family and the religious clerics in Saudi Arabia. In order to film, I would need to wear the abaya, a black garment covering the body and part of the face and I would have to be escorted by a male chaperon provided by the government. (Sighs) This is the only place in Saudi Arabia that I'm free. I feel free within the four walls of my hotel room, otherwise I have to walk around in this black abaya and just pretend that I'm invisible to the world. Later that evening, I experienced first hand the restrictions placed on Saudi women. ..and a tomato basil soup. Thank you. Even though there are several restaurants in this hotel, we as women only have two options - either we can order room service or we can go down to the coffee shop because all the other restaurants are off to women.

The following morning I saw evidence of change. Just five years ago Saudi women were forbidden from holding manufacturing jobs. Today, although they count for only 6% of the workforce, women are working in factories all across the kingdom. 22-year-old Hadija was confident that Saudi women would get more opportunities in the future. (Speaks Arabic) Beyond the workplace these women hope to have an impact closer to home. What rights do you want for your daughter that you didn't have when you were growing up? Do you think it's important for women to work in Saudi Arabia right now?

When you started this project, from the Government or from the male-dominant society? When we started the project we got a lot of support from government officials, otherwise we wouldn't have the permissions to start. The belief of businessmen in women's ability was the initiative to start the project. We didn't really face any problems. There are sometimes people who will doubt the experiment but it wasn't really something significant that was an obstacle in starting the project, no. I was encouraged to see these women taking the first steps towards financial independence but despite their new freedoms women here are still held to the strictest laws of Islam.

Legally, an unmarried adult woman is the ward of her father.

A married woman is the ward of her husband and a widowed woman is the ward of her sons. Women cannot get an identification card, obtain a passport or be admitted to a hospital without permission from the male guardians. Women are segregated from men in public, prohibited from driving, taught in separate schools and restricted to family sections of restaurants and female-only stores. I stopped for some coffee at Starbucks. Although it looked the same from the outside Starbucks in Saudi Arabia was very different inside. It's just amazing how contradictory society here is. I'm sitting in the Starbucks family section. Only women with their husbands, brothers or sons are allowed in here. The single men have a separate section.

Yet when I go to buy my coffee I can buy it from a strange man. After coffee I headed t a conference organised by the Saudi government to discuss the role of women in Saudi society. Just a few years ago a conference like this would have been unthinkable Today the Government permits it even though the religious clerics do not approve.