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ABC News Breakfast -

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(generated from captions) Israel begins pulling out of

Gaza as part of a ceasefire

deal, but both sides say they

are ready to take up arms if

their demands are not met. A

recession on the way, a troubled Budget.

troubled Budget. A gloomy

economic forecast greets the

Prime Minister on his first day

back to work. Barack Obama pays

his respects to fallen soldiers

as thousands prepare to give

the new President a Rock star

welcome to Washington. Lance

Armstrong returns to racing,

the glory goes to Robbie

McEwen, as he takes out the

Cancer Council classic in Adelaide. This Program is Captioned

Live.

takes out the Cancer Council goes to Robbie McEwen, as he returns to racing, the glory Washington. Lance Armstrong rockstar welcome to

Live. This Program is Captioned classic in Adelaide.

Classic in Adelaide. Live. This Program is Captioned

Good morning, it's Monday, 19

January, I'm Joe O'Brien. I'm

Tamara Oudyn. The top story -

Hamas followed Israel's lead by

agreeing to a ceasefire overnight. Already there are

ground. signs the deal is on shaky

ground. After a Hamas official

made the announcement rockets

were fired into Israel from

Gaza. The military campaign in

Gaza has been going on for more

than three weeks, with more

than 1300 Palestinians

dead. Even though Israeli tanks and soldiers are slowly being

withdrawn, the country is ready

to return to war against Hamas

if the rocket attacks continue. We are only

negotiating with Egypt. negotiating with Egypt. Egypt

is the only negotiateding

track, and it's only with Egypt

that we are trying to sort out

our problems, and to see how to

instore a durable ceasefire.

Talks will go on, of course,

with Egypt on this track. If

Hamas wants to say something,

they can say it to the

Egyptians, they know that very

well. It is a bit curious that they should

they should come out with such

public calls on the media when

the only valid track is known

to everybody. Despite the very

strong blows that the IDF has

delivered to Hamas terror

organisation, it's clear Hamas

is still there, still it will resupply itself resupply itself with fresh

rockets to bomb our cities,

therefore it's clear that we'll

have to confront them again and

take decisive action to remove

the threat once and for all. ABC correspondent Philip Williams travelled to the

Israeli-Gaza border where

rockets have been fired after

the ceasefire began. He joins

us on the line from Jerusalem.

What impact has the firing of

those rockets had on the ceasefire ceasefire that Ehud Olmert said

is being reassessed minute by minute. Well, they have

continued today, although once

Hamas said it has declared its

own ceasefire, they did drop

off. I think there are two or

three after that but it could

be the case that the demand

control over Hamas fight are so

poor, damaged, that they don't poor, damaged, that they don't

have their command stopping.

It's a bit unclearment the

Israelis made it very, very

clear that they will not

tolerate the rocket attacks to

continue, and that if they do,

they'll hit back hard. There's

always that possibility that

although the troops and the

tanks are headed back towards

Israel, that they could turn

around and it could all start

again. It's a very fragile

situation. What is the mood in situation. What is the mood in

Israel at the moment. Is there

a sense of victory at any time

kind? There's a clear sense of

victory that there has been a

job to do, it has largely been

done. There were two things it

wanted to do. The Government

wanted to stop rocket attacks.

It hasn't entirely done that

but has weakened Hamas' ability

to do that substantially, and stop the ability stop the ability to resupply

with the rockets, particularly

through the tunnels at the Rafa

border with Egypt. With

international agreement with

the Egyptians to increase

efforts, Israelis are confident

that the land routes that

brought in the rockets will be

closed off, if not entirely, squeezed. There is a sense satisfaction that that has been squeezed. There is a sense of

done. It's been asterible toll

for the people of Gaza, 13 --

it's been a terrible toll for

the people of Gaza, 1300 dead,

massive destruction, when you

see the pictures of homes,

office buildings,

infrastructure, that will cost

millions to replace. It's going

to be an enormous rebuilding

job. The Israelis say they had job. The Israelis say they had

no choice, they had 5,000

rockets reigning down on their

-- raining down on their

villages and settlements, but

enough was enough. The Gazans,

of course, would certainly say

enough is enough. They have

endured 23 days of hell. We

don't know that it's all over

yet. With the ceasefire on both

sides, what effect has that had

on the flow of humanitarian on the flow of humanitarian aid

and medical assistance that

obviously so badly is needed. Humanitarian aid, we

are told by the Israeli side,

has improved. They've opened

borders to humanitarian

supplies, they are flowing better. As for medical

supplies, in terms of getting

people out for treatment in

Israeli hospitals, I went to an

opening of a makeshift hospital

at a cross

at a cross ing next to Gaza

today, and there was a big,

sort of, official opening of

this area, and they had all the

doctors, and rooms and

ambulances, everything, ready.

The only thing they didn't have

was any patients. It was

certainly too dangerous, we

were told, to get the

ambulances through. It's still

quite a negotiation to get the

patients across. We know from

reports in Gaza reports in Gaza that there's an

urgent need for medical

assistance, particularly in the

more complicated case, so

there's no doubt about the

need, but the actual ability to

get these patients across the

border is being tested at the

moment. I understand that

foreign journalists are allowed

into Gaza in a pool basis for

the first time. What are they seeing seeing there? What they are

seeing is utter destruction.

You can hardly believe the

scale of it in some areas. You

look at some of the pictures,

wide shots. You can see

obviously there are apartment

buildings, almost whole blocks

seem to have disappeared, and

people are picking through,

trying to find belongings, far

more sadly picking through

buildings trying to find the

bodies of their loved ones, bodies of their loved ones, there are bodies being

recovered, and bodies that have

been buried in haste, covered

over with a few inches of dirt

that are going to have to be

exhumed and reburied properly.

The human toll is absolutely

enormous, the strubilityural

toll is enormous, -- structural

toll is absolutely enormous,

and the toll in terms of the relationship between the two

people, obviously it has suffered suffered extreme damage, we

don't know the consequences of

that just yet. We may not know

that for years. Philip Williams

in Jerusalem thanks for joining

us this morning. If you'd like

to send us your feedback on any news stories - In In other news the Prime Minister Kevin Rudd returns to

work this morning after a

3-week break, facing worse

economic forecasts. 'Access

Economics' is predicting

Australia can't avoid a

recession, and says the economy

shrank in the December quarter

despite the Government's $10

billion stimulus package and

the company expects the economy

will shrink this quarter. The

court case against a man from court case against a man from

Melbourne charged with

insulting Thailand's monarchy

is expected to beginning in

Bangkok. Harry Nicolaides is

charged with insulting the

royal family, in 2005 he

published a novel making a

brief reference to the

country's Crown Prince, 10

copies of the book were sold.

The 41-year-old faces 15 years

in prison if found guilty. A group of group of suspected asylum

seekers is being escorted to

Christmas Island by The

Australian Navy, it has 20

people on board, and was found

Saturday 21 nauticcal miles

north of Ashmore Reef off the

Kimberley coast the the nags

atties of those on board is

unknown. In the lead-up to the inauguration, Barack Obama paid

tribute to those lost in war, he

he and Vice-President-elect Joe

Biden visited the Arlington

National Cemetry, and laid a

wreath. In the next few hours

they'll attend a rock concert

where U2, Beyonce, and Bruce

Springsteen will prepare to

welcome the pair to Washington.

Investigators are studying data

from the Flight recorder of the

plane that crashed into New

York's Hudson River Friday.

Salvage teams winched the

Salvage teams winched the

airbus from the icy river. The

pilot said the plane hit a

flock of birds and both engines

cut out. To Zimbabwe, the

opposition party is insisting

its demands be met during

negotiations with the

Government. A spokesman for the Movement for Democratic Change,

Nelson Chamisa says the party

has agreed they will not be

bulldozed into accepting a

compromised deal when talks start with Robert Mugabe's start with Robert Mugabe's

Government later today. We

deliberated on a number of

issues, we deliberated on the

issue of the humanitarian

situation in the country,

security and human rights

situation in the country,

particularly the issue around

the abuctees, their

whereabouts, those incarcerated

and those missing, what was

noted by the executive is we

need to bring finalitiy to the need to bring finalitiy to the

issue of negotiations, and

tomorrow is a crucial day, is a

watershed in terms of bringing

to finality and closure the

chapter of negotiation, and in

that regard, what the President

is saying, the MDC will not be

bulldozed into accepting

piecemeal the outcome of those

negotiations. We are going to

insist on our insist on our outstanding

issues. Nelson Chamisa there

from the Movement for

Democratic Change. Now, for

more on this 'Access Economics'

report about the grim outlook for the Australian economy, we

are joined by Ben Worsley from

Canberra. Ben, we have been

hearing about the grim

forecasts for a couple of

months now. This one seems to

go further. It does, Joe. What

is interesting, is that the Government seems to

Government seems to be

gradually tailoring its

rhetoric when it comes to the

predictions for this economy,

and the effects of the global

financial crisis. In terms of predicted surpluses, and

growth, etc, etc. The crux of this 'Access Economics' report

seems to be that China has

slowed far more considerably

and quickly than anyone and quickly than anyone

expected and the effects on

Australia are profound.

Possibly more than any other

country in the world because of

our reliance, our economy's

reliance on our exports to

China, to fuel and build its

growing economy. Now, the

figures in this 'Access

Economics' show that Chinese

projected growth dropped from 9.7% to

9.7% to 6.2% this year. The figures for Australia are

stark. It's predicting

unemployment to head to 7.5% by

early next year, iron ore and

coal exports expected to halve, costing the Federal Government

$23 billion, house prices

council 8%, good news the RBA

is expected to cut rates to

around 2.5%, a historic low. The current account The current account deficit to

$100 million, and the Federal

Government deficit to $30

billion within a couple of

years, grim news indeed. Using

words economists don't resort

to like "buggered". I thought I

might get in trouble if I used

that. I'm glad you said it. The

deficit, Budget is buggered

according to Chris Richardson from 'Access Economics', he'll

be on the show to be on the show to explain what

he means by the colourful

language. It certainly gets the headlines and proves or makes

the point that Treasury's forecasts, Wayne Swan says

modest surpluses and modest

growth for some time. Perhaps

they are way off. Chris

Richardson things the

Government would have updated

Treasury forecasts, you expect

it would and they show if not

buggered, at least not quite buggered, at least not quite as

healthy or as modest as Wayne

Swan has been saying. The

question becomes what are the

Government's priorities as the

money disappears, there's a lot

of spending on the table from

infrastructure, tax cuts,

broadband supposedly paid

maternity leave, Kevin Rudd

says it's time to bite the

bullet. He may be spit

Territory Government out,

putting it aside for --

spitting it out, putting it aside for some time aside for some time to come

dismoo. If the Budget is

buggered the Government will be

forced to make difficult

decisions on what policies will

stay and go, what is iron clad

guarantees on, in terms of

policies? Kevin Rudd's made a

big deal about not having core

or non-core promises, as his

predecessor once had after an

election, famously. He's

determined to stick by those election promises that had a

price tag. You think of the tax

cuts, $31 billion over the

forward estimates. Broadband

$4.7 billion. Those things he

has so far said are iron clad

guarantees. There are other

things that would be very hard

for the Government to wriggle

out of. Pension reform would be

one of them. It's easy for a

Government to take Government to take a lot of

heat on something like that,

they have promised overall

pension reform in the Budget.

Other things, maternity - paid

maternity leave are less iron

clad. There was never an iron

clad promise, but a suggestion

they might head down that path.

It's those things that might

dwindle, and the infrastructure projects, there's nothing

specific, there's a ballpark

and an idea they want and an idea they want to head

in that direction as a way of

pump prime in the economy. The

magnitude of those, that spending might suffer as a

result of this. It's all a bit

airy-fairy at the moment. The

May Budget will have an idea as

to what is in and out. It will

be an interesting 3-4 months up

until then. Sounds like we'll

all suffer. Ben Worsley in

Canberra. Despite the celebrations surrounding Barack

Obama's inauguration, American

citizens can't escape the

reality of their economic woes. Unemployment reaching its

highest level in 16 years, two

of the Barack Obama Administrations spoke on

American television overnight

reassuring viewers decisive

action will be taken I think

what you will hear is a time

and a place in which we all

have an area of responsibility,

too long there's been a culture

of anything goes. And that to

do what we need to do as a

country, regain America's

greatness and move forward and

be an example around the

womped That's what we are

trying to avoid, double digit

unemployment, we are trying to

take measures creating 3-4

million jobs in the next couple

of years, to try and slow down

this plummeting employment, and

I think we can do that. I think

it's fair to say that it is

going to take not months, but

years to really turn

this... That's David Axelrod,

the senior advisor to Barack

Obama. For more, John Shovelan

joins us from Washington. Good

morning, John. Barack Obama

arrived at union station last

night after his train trip.

What's been happening there

today. Well, the train trip, of

course, was quite a

celebration, the beginning -

his trip to Washington. Today

he tempered some of the

celebration by this morning

attending Arlington National

Cemetry the sacred burial

ground of American soldiers, he

laid a wreath at the Tomb of

the Unknowns with the

Vice-President-elect Joe Biden.

After that, Mr Obama was off to

church at a local Washington DC

baptist church, one with a long

history, African-American

history. And from there he's

off to the concert, which -

this afternoon, it kicks off

the official inauguration

celebrations. We have seen

David Axelrod, and Rahm Emanuel

doing the talk show circuit

there. Are there any early

indications of what Barack

Obama might do for his first

day in office, in fact, the

first days of his

presidency. Well, certainly the

economy is the No.1 issue

domestically in the United

States. It's unlikely we'll see

immediate movement on that in

the first week. A couple of

things that he will be dealing

with, we are told, in the first

day, a couple of executive

orders, one will be to close

Guantanamo Bay. There'll be

something from the President on

the issue of torture, on the

first day we know he'll meet

with the military generals, the

Chiefs of staff, as well as his

economic advisors, but the

issue of the economy itself -

they are still negotiating with

the Congress, and that will

probably take some weeks before

- I think it's something like a

1.1, $1.2 trillion bailout

package for the US economy for

main street this time, gets

through the congress. Barack

Obama is assuming the

presidency in an atmosphere of unprecedented goodwill. How

long do you think it would take

before the gloss starts to wear

off and the American public

starts to expect a

turnaround? Well, I think

there's a view that Americans

are aware of just how serious

the problems - the country

the problems - the country is

facing at the moment. I think

they are willing to give him

quite some time. But once that

package gets through the congress, you are probably

looking at, you know, some time

late this year, Americans will

want to see some signs of a

turnaround. I would imagine

that by the end of the year, if there isn't some improvement in

the economy, the recession will

become the Obama recession.

Already the more extreme hard

core conservatives call it the Obama obsession before he's

sworn in, by and large the American population are willing

to give him until the end of

the year. They'll want to see

improvement by then. John

Shovelan in Washington, thanks

for joining us. Of course, on ABC1 on Wednesday morning

there'll be live coverage of the

the inauguration, and then on ABC 'ABC News Breakfast' on Wednesday, Barrie Cassidy will

host our coverage from

Washington. Make sure you are

watching then. The top stories

- rockets continue to be fired

from Gaza after Hamas follows

Israel's lead by agreeing to a

ceasefire deal over Gaza,

Israeli tanks and soldiers

began withdrawing after a 3-week

3-week long military offensive

claiming more than 300

lives. Economists predict

Australia is going into

recession, and is on the brink

of suffering the worst economic

downturn in history. 'Access

Economics' says the economy

shrank despite the $10 billion

stimulus package, Treasurer

Wayne Swan says the got will

respond with more measures if needed. The US President-elect

Barack Obama pays tribute

Barack Obama pays tribute to America's fallen soldiers as

washed gears up for his

in-August -- Washington gears

up for his inauguration, Barack

Obama and Joe Biden will join a

rock concert where U2, Beyonce,

and Bruce Springsteen will

welcome the pair to Washington.

And now to the front pages.

Major newspapers around the country. The Australian reports

country. The Australian reports

foreign students have begun to

pull out of Australian universities, which way cost

jobs and hurt the housing

market. 'The Financial Times' leads with Barack Obama

arriving in Washington,

pledging a new Declaration of Independence to address

America's problems. Treasurer

Wayne Swan promised further

action as forecaster 'Access

Economics' predicts a recession

for Australia, reports 'The

Age', and shows Lleyton Hewitt

practising at Rod Laver Arena

yesterday. The 'Sydney Morning

Herald' pictures the

frustrating peak-hour rush on

Sydney's ferries, the paper reporting Israel deliberately

blocked the UN bringing food

supplies into Gaza. The

Adelaide 'Advertiser' pictures

cyclists in the cancer classic

in Adelaide yesterday. 'The Northern Territory News'

pictures a salt water crocodile

sunbaking on a territory beach, and

and reports a man that sold

breath alicers for a living

lost his licence for

drink-driving. 'The Canberra Times' reports three youths arrested in relation to a

six-week gang rampage in the

nation's capital. The paper

says Canberra will be a city

hardest hit by future climate

change across Australia. 'The

West Australian' reports on 20

asylum seekers intercepted by

the navy off its coast

Saturday. The paper shows Joe

Biden and Barack Obama waving

to crowds, while tracing the

inauguration journey of Abraham

Lincoln. The Hobart 'Mercury'

reports on the troubles of

Minister Paula Wriedt that quit

politics yesterday. Looking at

the finances, the US market closed lower:

In a few minutes Vanessa

O'Hanlon with a look at the

weather. Also ahead we'll have

a review of some of today's

newspapers, we'll be joined by

Scott Burchill, a senior

lecturer in international

relations from Deakin University. Paul Kennedy with

sport. Robbie McEwen upstaged

one of the most talked about

comebacks in sport last night.

But only briefly. The 50mm criterium through the streets of Adelaide was Lance

Armstrong's first race in more

than three years, the 7-time

Tour de France winner rode in

the middle of the peloton,

completing the race in 64th

position. Robbie McEwen won in

a sprint finish signalling he's

a force, he said it was a

pleasure riding in front of his

home crowd of more than

130,000. Lance Armstrong wrote

on Twitter, "First day done,

fast criterium, great to be

back, legs felt good", he was

asked one question after the event. How did Lance Armstrong

look out there. He looked good,

I said g'day in the first 10

laps of the race. He was glad

to be there, I said, "Welcome

back", he was cruising no

worries, staying out of

trouble. He said I'd give you a

handshake, I don't want to take

my hands off the bars, quite

right. The battle for top spot

in the A-League will be decided

next week, Adelaide failing to

cement its place, drawing with

Wellington, New cast beat Perth

2-1. Here are come -- Newcastle

beat Perth. Here are some

highlights.

See if Perth Glory can

continue their fine record at

EnergyAustralia Stadium. Now

they have the goal.

That's the way you head the

ball, running into the box. Was

it outside? It's a 3 points.

Milligan, right down the

middle. Very confidently

struck. In English plooeg West

Ham beat Fulham. Tottenham drew

1-1. Good goals, none better

than Paul Concheski's.

Premier League West Ham beat Paul Concheski's. Good goals, none better than Fulham. Tottenham drew 1-1.

That is stunning. It's an

excellent strike, curling away

from the goalkeeper, there's

nothing Strauss can do about

it. What a goal. Cole is

heading for coal. Nobel

scores. Here is Demakali.

The shot is around the

corner. No wonder he wheels

away in celebration.

Yeah, it's off Campbell's

legs. The Australian Open

starts, former world No.1 Roger

Federer says he's had a

near-perfect preparation for

his shot at a fifth title. Surprise, surprise, Lleyton

Hewitt will carry Australia's

hopes. An encouraging return

from injury in Sydney has given

Lleyton Hewitt plenty of

confidence. I'm still as driven

in motivated as I think I have

always been, probably more so

after having the injury, and

putting in the hard yards to

get back just to get back on

the court. His ranking may have

slipped to 74. Hewitt is

Australia's best hope among a

dwindling contingent of locals

ched Until we have more in the

top 100 in the world getting

direct acceptsance into the

Grand Slams, it will be fall

back on guys like myself and

Chris Guccione. Roger Federer

is chasing a fourth open, it

would seem equally Pete

Sampras's record of 14 Grand

Slams, despite displaying

vintage forms clag the Kooyong

Classic, some don't rank the

world number one amongst the

top two favourites. A lot of

people say it teams like a

tough general aches with Andy Murray, Jelena Dokic, and

Rafael Epstein, it's not that

much stronger when we had adcy,

Roderick and Hewitt. It's a big

morning, Philadelphia take on

Arizona. Sav Rocca and Ben

Graham playing in that in

American football. Ben

Graham's groin is a bit dodgy

this morning. He may not

play It one of them guaranteed

on getting through to the

final. Yes. Whoever wins out of the Philadelphia

the Philadelphia and Arizona,

Ben Graham played for Arizona,

Rocca for Philadelphia, and

Bolton and

Pittsburgh. Guaranteed of an

Australian playing in an NFL final in the first

time. Ever. If the groin's

OK. Let's spare a thought for

Ben Graham's groin. Cricket was

good. Yesterday in Hobart, the

Australians levelled the series 1-1 with South

1-1 with South Africa, coming

down to the last over. The

50-over game, it may be on its

last legs with Twenty20 overtaking it, good games on

Sunday and Friday. It was more

of a case of South Africa just

failing to win it, rather than

Australia winning it. I think

so. Halfway through the innings it looked like South Africa

would do it easy, the Aussies

bowled well.

bowled well. Ben Hilfenhaus,

the local boy had to contain

them, they needed 17. Bouper

hit a six in the -- Boucher hit

a six. On Friday Hilfenhaus had

18 taken off an over, he held

his nerve and looks good. Is

Juanita Phillips likely to get

another go. -- is David Warner

likely to get another go. I

think so, it would be harsh to

cut him from the squad. Maybe

the worse thing he did is make

the 89 in the Twenty20. He did

good, took a couple of good

spots and was dismissed by the

world's best fast bowler twice

in a row. 'ABC News Breakfast'

can be watched live on the web from anywhere in the world.

Now, here is Vanessa O'Hanlon

with a look at the

with a look at the weather, and

a big week in Melbourne this

week, what is the weather

looking like It should be warm

with temperatures between 29

and 32 right up until Friday. A

hot one on Saturday , 36, a

cool change sweeping through.

On the satellite - isolated

over the Northern Territory. showers and storms expected

Parts of South Australia,

Queensland and NSW with all

this thick cloud moving through

the country. Dense cloud over

Tasmania, with a cold front

causing widespread showers, hot

northerly winds developing in

the south-east, a trough

bringing a weak cool change to

South Australia. A monsoon

trough causing widespread

storms across the tropics and a

trough in the west triggering

storms in southern WA.

Queensland - rain and scattered

thunderstorms in the west and

north-west. Moderate to heavy

north-west. Moderate to heavy

falls over the north tropical

coasts. NSW fine apart from isolated storms in the

north-west. Hot in the waste, a

fire warning for the

south-west. Victoria, a hot day ahead. Particularly in the

north. For the start of the

Australian Open,

sunny. Tasmania cloudy with

isolated morning showers about

the south, otherwise fine. Cool

to mild with light win and

coastal sea breezes. South

Australia - dry, apart from

isolated showers in the far

north-east. Possible thunderstorms developing later

in the day: WA - isolated

showers and storms along the

coast, and southern inland

areas. Nup the north scattered

showers and squally

thunderstorms -- up in the

north, scattered showers and squally thunderstorms, showers

and storms across the

Territory. Tomorrow: showers and squally Up in the north scattered

Territory. Tomorrow: and storms across the squally thunderstorms, showers north, scattered showers and thunderstorms -- up in the

See you in half an hour.

The top story on 'ABC News

Breakfast', both Israel and

Hamas have now agreed to a

ceasefire deal and it's hoped

it will bring a permanent end

to the fighting in Gaza, more

than 1300 Palestinians have

been killed in the conflict,

many children. Despite the

ceasefire rockets fired from

Gaza continue to hit Israeli

towns, and Israel says it is

not ruling out more military

action if Hamas fails to abide

by the truth. We have this

report from the BBC. This was

Hamas' first response to Israel

calling a one-sided ceasefire.

Rockets launched at Israeli

communities just over the Gaza

border. Israel said it assumed

Hamas, a resistance movement

would want the last word on the

ground. That done, Hamas had

this to say.

TRANSLATION: We, the

Palestinian resistance factions announce a ceasefire in the

Gaza Strip much we stress that

our demand is the withdrawal of

the enemy forces within a

week. Israel says it won't have

a timetable dictated by those

it calls terrorists, and

started pulling some troops out

of Gaza today. They feel they

have done a great job there.

For the moment fellow soldiers

stay behind, just in case. At

the weekly Cabinet meeting today, Israel's Prime Minister

warned the ceasefire was shaky,

and said it would be monitored

minute by minute. Israeli policitians are sounding

confident. They called for a

ceasefire before Hamas, Hamas

fires rockets at Israel

tomorrow or a week from now,

Israel believes it has the backing of the international

community to hit back hard. In

Gaza, some have felt safe

enough to return to their

homes. Or what is left of them.

Others never got the chance to

escape Israel's bombs. Rubble

and debris became their

gravestones. Their families are

only recovering them now.

People are distraught, angry

and suspicious of Israel. They

don't know how to start piecing

back together their shattered

lives. If you have a view about

the ceasefire in Gaza, or any

of the stories we are covering,

let us know: In other news, the Prime Minister Kevin Rudd returns to

work this morning after a

3-week break, and faces worse

economic forecasts. Access

Economics is now predicting

Australia can't avoid a

recession, and says the economy

shrank in the December quarter

despite the Government's $10

billion stimulus package and

the company expects the economy

will shrink again this quarter.

The court case against a man

from Melbourne charged with

insulting Thailand's monarchy

is expected to begin in Bangkok. Harry Nicolaides has

been charged with insulting the

royal family. He published a

novel in 2005 making a brief

reference to the country's

Crown Prince, only about 10

copies of the book was sold.

The 41-year-old faces 15 years

in prison if found guilty. A

group of suspected asylum

seekers is being escorted to

Christmas Island by The

Australian Navy. The boat with

20 on board was stopped 21

miles north of Ashmore Reef,

off the Kimberley Saturday. The nationalities of those on board

weren't known. In the lead-up

to his historical inauguration,

Barack Obama paid tribute to

those lost at war at arl r he

and his Vice-President-elect --

Arlington National Cemetry, he

and Vice-President-elect Joe

Biden visit the resting place

laying a wreath at the Tomb of

the Unknowns. In the next few

hours they will attend a rock

concert where U2, Beyonce and

Bruce Springsteen will perform

to welcome the pair to

Washington. Investigators are

studying the flight data of the

plane that crashed into the

Hudson River Friday. The

aircraft has been winched from

the river. The pilot told

investigators the plane hit a

flock of birds and both engines

cut out. Doctors in Glasgow

build will be the first in the

world to trial a stem cell

treatment for stroke

patientsment the company that

developed the treatment said it

will push the United Kingdom

ahead of the US. We have this

BBC report. These are frozen

brain cells. They have been

taken from an aborted foetus

and genetically modified. The

hope is they'll be able to

reverse the effects of a

stroke. Dr Keith Muir is to

begin the clinical trials of

stem cells to treat stroke.

Surgeons will inject foetal

stem cells into the brains of patients in the hope of

repairing damaged brains. If it

repairing damaged brains. If it

works, as it did in animal

model system, it may allow new

nerve cells to grow or

regeneration of existing cells

and recovery of function in

patients who would not

otherwise be able to regain

function. Until recently John

used to be a dance instructor,

now he can't walk. When John

first had his stroke part of

his brain was damaged. In the

trials doctors hope to inject

stem cells close to the damaged

area and it's hoped the cells

will multiply, repairing the

damage. This is the world's

first major stem cell treatment

involving patients. The doctors

believe there's a real chance

of some success. The treatment

is controversial. These cells

were produced from an aborted

foetus. No more foetal material

will be needed. These cells can

be copied to produce unlimited

quantities. Critics say the use

of one foetus is wrong. The

company that developed the

treatment says the therapy

could help millions of

people. In WA firefighters

continue to mop up operations

after battling several bush

fibres over the weekend.

Authorities are counting the

cost of the fires which

blackened thousands of hectares

of bushland around Perth and a

large section of Kings Park in

the heart of the city. Andrew

O'Connor joins us from the

ABC's Perth newsroom. Have

authorities put a figure on the

damage bill yet. There's no

precise figures, it's likely to run into run into the tens of millions, there was a large fire at Bridgetown, south of Perth, burning 6,000 hectares of bushland. At the peak of that fire there were 300 firefighters engaged in the fight using helicopters and a range of assets. What was lost in that fire was three houses, a number of farm sheds and buildings, it took out powerlines, cutting off of the residents evacuated haven't been able to return home. At Yanshep, north of Perth, 7,500 hectares of bushland were burnt out. There was no homes or buildings lost, but a pine plantation covering

2,500 hectares, valued at $60 million, there's a massive salvage operation to begin to get the timber out of the plantations into storage before it deteriorates. The cost of reestablishing that pine plantation will be in the vicinity of $20 million. Have they worked out what started

the fires? The fire investigators are trying work out exactly how each of these fires started. It looks as though each one was deliberately lit. Arsonists are believed to have started two fires at brige town leading to the large blaze that burned out of control for two days, and the years at Yanchep and Kings park in the centre of Perth were deliberately lit. On Friday the temperature peaked

at 42, coming at the end of a

hot spell. Perth had a record

hot start to the year. The many

temperature has been a bit over

34.6. Conditions were

absolutely ideal for bushfires.

As Vanessa O'Hanlon said

conditions are milder here now.

We are going for a top of 29.

We are having to contend with

thunderstorms. I can see out

the window that there's a large

amount of lightning stretching

across the horizon,

firefighters will be concerned

about fresh outbreaks from

Lightning streaks and will be vigilant throughout the

korning. Andrew O'Connor in

Perth. A National alcohol code

of conduct has been launched to

encourage professional

sportsmen and women to drink

responsibility, John Fitzgerald

is an Associate Professor at

Melbourne University and an

author about a study about

binge drinking and sport

culture and joins us. What's in

the code of conduct, what is

expected of sport players. It's

not just expectation for sports

players, but puts responsibilities on to clubs,

leagues, associations and

players themselves. And so you

have your reservations about

whether will work or not. Look, it's probably a good

first step. It's a first kind

of articulation for leagues and

associations to say, "Look, we

want to do something about

binge drinking. By asserting in

a voluntary way, these are the

things we want to do". It's a

good first step. Ultimately

it's disappointing. Why has the

decision been made to go with a

code of conduct, not something

with teeth that is enforceable. Good question. If

we are looking for cultural

change, there's numerous

attempts internationally to

create the effects we want. If

we want to reduce the impacts

of alcohol and have a

demonstrable difference,

effective things, that carry

weight - we have unfortunately

gone for a voluntary code. We

would anticipate through it

being voluntary, is it having

minimal impact. The culture

will continue, the drinking

culture will continue,

according to you. What are some

of the specifics of what you

think should be in a code to

turn this around. What do you

want in there. What do you want

written. One of the -

internationally what we know is

that what has an impact on

people's drinking behaviour is

when you change the buy, how

much you spend. You also - and

also if you change the

conditions, the reasons why

people drink. This particular

code of conduct throws it on to

the individual, what I'd like

to see in a code is something

dealing with the system

surrounding them. We have sport

in Australia is structured

around alcohol advertising. You

know , even at a local level,

it filters down to the local

level from the top leagues, and

alcohol advertising essentially

is a core part of the broadcast

rights We have an email from

a viewer. G Ireland of

Bundaberg. I think I have heard

that fame before. He or she

writes: --

Do you think there's a bit of

a conflict of interest there

because there's so much money

coming in through tonne

soreship. I think it's an --

through sponsor spp. I think

it's open. The AFL have been

clear saying if you put an

excise or limitation s on

advertising, that will have an

impact on the financial

viibilityy. The numbers are

extraordinary. -- viability.

The numbers are extraordinary.

We spend $100 million on

alcohol advertising, the

majority associated with sport,

and the majority of that with

live Brode casts. Live Brode

casts are the one exception

that we have around the

regulation of alcohol

advertising to the community.

This is big business, if you

look at the broadcast rights,

how much it's worth to the AFL,

this is big money, it's not an

undisclosed interest, it's an

interest we need to deal

with. It's hard to see a time

in the future with the two

entities will be divorced from

each other, sport and alcohol advertising. Several decades

ago we said the same thing

about top acko. You do see a

day when alcohol advertising

will be banned at sport. Absolutely, the W-League

HO recommended that we needed

to do this, an expert committee

for the W-League HO suggested

committee for the W HO needed to do this, an expert that. HO recommended that we

suggested that. -- Give us an

example of what you would like

written in a code. One thing

you could do, friendships, is

for clubs to make a clear

gesture to not accept alcohol

sponsorship. That would be a

simple thing to do. Financially

they can't do it now One thing

the Government did originally

when they had the issue with

tobacco was they provided subsidised space for

sponsorship. The Government did

it in the past when there's a

clear public health benefit. And the issues to

violence... Do you want the

Government to step in and

subsidise it. It's been done in

the past. I don't think there's

much money to go around over

the next few years. Maybe. The

costs of alcohol to the chuny

is substantial. It's not - it's

not like this is an added

burden, this is alleviating a burden that alcohol is bruising

on the community at the

moment. Thanks for joining us

this morning. The Australian

Open begins in Melbourne, with

no clear favourite in the men's

or women's draws, with

temperatures forecast above 30,

organisers hope to better last

year's record crowd. James Bennett joins us from outside

Melbourne Park. James, exactly

what is in store for fans

there. In a word, plenty, on

the tennis front Roger Federer

is having what's billed as a

watershed year, one seeing him

propelled into immortality if

he equals or betters Pete

Sampras's record 14 titles or

the end of his era, if he can't

come back, form player is

Scotland's Andy Murray, seeking

to become the first Britain to

win a male singles title since

Fred Perry in the 1930s. Roger

Federer, and Lleyton Hewitt

have both fired a shot across

his bow saying he hasn't won a

major, and needs to do so

before he can be taken

seriously. Also speaking of

being taken seriously, Spaniard

Rafael Nadal has asked fans in

a web site conversation to

please ask him less about his

wedgie, and more about his

tennis. On the women's side of

the draw, world number someone

Jank r the Serbian is fighting

off a -- Jelena Jankovic, the

Serbian is fighting off a

challenge fromcm who says she

believes she's -- from Serena

Williams, she believes she's

No.1. Williams believes she has

to believe she's No.1 if she's

to play competitively. What

else, apart from the tennis is on offer at Melbourne

Park. Over to my left is S pjs

eagleworld. This is an

innovation, a bit to capture an

entertainment side. Aside from

free concerts and ticketed

concerts, the major feature is

a burlesque show, cabaret

style, costing you $76 if you

watch it on Broadway in New

York. Tennis goers will pay

$19. It's billed as a zany

combination of erotic innuendo

and acrobatic skill. Plenty in

store for the tennis goers on

the fans and entertainment

front as organisers seek to

make this the players' tournament. James Bennett in

Melbourne. Thanks for that. You

are watching 'ABC News

Breakfast', the top stories -

rockets continue to be fired

from Gaza after Hamas follows

Israel's lead by agreeing to a

ceasefire deal over Gaza,

Israeli tanks and soldiers

begun withdrawing after a

3-week long military offensive

claiming for man 1300 lives, economists predict Australia is

going into recession and is on the brink of suffering the

worst economic downturn in

history. 'Access Economics'

says the economy shrank in the December quarter despite the

Government's $10 billion

stimulus package, Treasurer

Wayne Swan says the Government

will respond with more measures

if needed. The US President-elect Barack Obama

pays tribute to America's

fallen soldiers as Washington

gears up for his inauguration,

Barack Obama and Joe Biden are

attending a rock concert later

today where U2, Beyonce, and

Bruce Springsteen will welcome

the pair to Washington.

Now for a look at today's

papers, not from just here, but

internationally. We are joined

by Scott Burchill, a senior lecturer from Deakin University. What are you

brought in for us. We have

international stories, the

obvious being Gaza, the

ceasefire, or the ceasefire

that is tenuous at the moment.

In Gaza the doubt is whether or

not Hamas will keep to the

terms that Israel has imposed

on them. Hamas said, of course,

there are conditions on

accepting any ceasefire, a

withdrawal of troops from the

Gaza Strip, as well as an end

to the economic blockade of

Gaza. We have a very difficult

situation, it's not clear that

the ceasefire will last. Hamas

has already launched rockets

into Israel proper, so I think

we are going to have to wait

and see whether or not this

ceasefire will last longer than

48 hours. How is it being

covered. It's being covered in

a very range of way, most

people, most analysts are sceptical as to whether or not

the ceasefire will last, but the big discussion in the

press, particularly in Israel

is about weather Hamas will

emerge as victorious in a

symbolic sense, after this

conflict. Clearly they have

taken a great deal of hits.

Their infra structure has been

destroyed. The popularity in

Gaza is the key issue that

people will want to focus on,

this is the important issue,

whether or not their reputation is enhanced within the Gaza

Strip itself, but in the wider

Arab world. As the - as

Hezbollah was in 2006, when

Israel tackled Hleb, even

though there's a military --

Lebanon, even though there's a

military defeat on the ground,

the party taking the brulent

was enhanced. Israeli -- brunt

of it was enhanced. This was as

much an attack on Iran as it

was Hamas, says the analysis.

What do you think of that

take. That argument is that

Iran is pulling the strings of

Hamas, and Hamas is a proxy of

Iran, a preferred argument in

Israeli Government circles, as

in Washington. However, that

argument, I think is a little

difficult to run. I think both

Hezbollah, in Lebanon, and

Hamas in the Gaza are

semiautonomous, they get

funding and support from Iran,

as far as dictating day-to-day

events, that's an

overstatement, and Iran

certainly will want its allies

in those places to succeed, I

don't think it's necessarily a

defeat for Iran. You are

mentioning the situation with

Hamas at the moment. Are there

indications yet as to whether

the popularity of Hamas has

increased or diminished as a

result of what happened It's

anecdotal, it appears Hamas' reputation increased. Clearly

the integes was to demoralise

the pop law -- intention was to

demoralise the population,

waning them off Hamas and

pushing them towards Fatah.

That hasn't happened and

there's no evidence that it

happened. President Abbas and the Palestinian Authority is

cast as almost irrelevant in

this discussion, which is not

what the Israelis and Americans want. What other stories have

you brought in for us. On the

front page of 'The Australian',

we have the overseas students

market in the Australian

universities being diminished.

We shouldn't be surprised by

this. The financial crisis will

hit particularly Asian students

and the capacity to finance

their education in Australia.

I guess the two factories that

are interesting to watch will

be the exchange rate, which is

a key indicator of where the --

weather whether foreign

students can afford to educate

themselves in Australia. And

whether all education markets

in the western world, including

the US, United Kingdom,

elsewhere are affected in the

same way we are. It's a

concern. Foreign education is

the third largest export market

in Australia, worth billions of

dollars to Australia. I'm sure

you'd be well aware of

that Absolutely, we are looking

to recruit overseas students.

Any financial impediment or

difficulty emerging is a

barrier to that, no matter how

desirable the university might

be. If they can't afford to

come, they won't, they'll stay

at home. Also we have in the

front of the age, the warning from 'Access Economics' about

the likelihood of a recession,

headline that the Rudd I think this is not the sort of

Government will be wanting to

read this morning. Especially

since Kevin Rudd is coming back

from holidays. I don't know how

accurate these are and 'Access

Economics' is speculating about

the possibility of this, but to

suggest that we are going to

head to a - am a 40% increase

in unemployment, a really

slashing of the Budget, and

increase in the need to spend

our way out of it is really a

big concern, I don't know how

much they can lower interest

rates further. The Treasurer

Wayne Swan seems to think he

can pump prime to stimulate

economic activity. In that

report access is saying that

its forecasts this that report

may not be the worst to come

kind of thing, it may get a lot

worse than that yet. That is

the problem. This will coincide

with an election cycle, which

must be of real concern to the

Rudd Government. We have less

than two years to the next

Federal election. If the

forecasts are accurate, the

conditions won't radically

improve before the election

date. The Rudd Government will

have to gear up to fight an

election in an economic climate

that is not great at all. It's

a negative one, it opens

opportunities for the

Opposition. Scott Burchill something caught your eye in

the 'New York Times', the 'New

York Times' is reflecting on

the popularity of Obama, and whether or not the United

States population will have

patience for the sort of

recovery that he has promised.

This is a key issue, clearly

overnight things are not going

to change, other than

symbolically. The US

population will need patients,

he will need that. He promised

a $1 trillion stimulus package

to kick-start the US economy.

It won't happen within a year,

18 months or two years and he

battles against high

expectations raised during his

campaign that things would get

better by electioning him. He

will have to deal with the

reality that that will not

happen. He's not a miracle

worker. Thanks for joining

us. Here is Vanessa O'Hanlon,

with a look at the

weather. Let's go to the

satellite where we see there's

a lot of cloud activity

happening across most of the

country, it's over the top.

North and coming right through

the interior, it is causing

widespread showers and storms.

Dense cloud over Tasmania, with

a cold front is expected to

cause a widespread showers, hot

northerly winds developing in

the south-east before a trough

bringing a weak cool change to

South Australia, a monsoon

trough moving from Queensland,

it's sitting over the Northern

Territory, causing storms right

throughout the territory, and a

trough in the west triggering

storms in Southern WA.

Queensland rain and scattered

norms in the west and

north-west. Moderate to heavy

falls over the north tropical

coast: hot in the west, fire

warnings for the south-west.

Victoria - hot, particularly in

the north. Hot for the

Australian Open. Tasmania - cloudy, isolated showers,

otherwise fine. Cool with light

winds and coastal sea breezes.

Across to South Australia -

dry, isolated showers in the

far north-east. Thunderstorms

developing later in the day. WA

- isolated showers and storms

along the coast and southern

inland areas. Up in the north -

scattered showers, squally

thunderstorms for the Kimberley, apart from the

south-west heavy showers and

storms expected across the

territory. A look ahead to

tomorrow:

See you after this.

Israel begins pulling out of

Gaza as part of a ceasefire

deal. Both sides say they are

ready to take up arms if their

demands aren't met. A recession

on the way and a troubled

Budget a gloomy economic

forecast greets the Prime

Minister on his first day back

at work. Barack Obama pays his

respects to America's fallen soldiers as thousands prepare

to give the country's new

President a rockstar welcome in

Washington. Lance Armstrong

returns to racing, the glory

goes to Robbie McEwen, as he

takes out the Cancer Council Classic in Adelaide. This Program is Captioned

Live.

Good morning, it's Monday,

19 January, I'm Joe

O'Brien. I'm Tamara Oudyn, the top story on 'ABC News

Breakfast', Hamas follows

Israel's lead by agreeing to a

ceasefire overnight. Already

there are signs the deal is on

shaky ground. After a Hamas

official made the announcement

rockets were fired into Israel

from Gaza, the military

campaign in Gaza has been going

on for more than 3 weeks, more than 1300 Palestinians are

dead. Israeli tanks and

soldiers are being to we draw,

but the country is ready to

return -- withdraw, but the

country is ready to return to

war if the attacks continue We

are only negotiating with

Egypt. Egypt is the only

negotiating tract and it's only with Egypt that we are trying

to sort out the problems and

see exactly how to instore a

durable ce