He urged Argentines to keep their cash in the banks and show faith in a massive debt swap even as interest

He urged Argentines to keep their cash in the banks and show faith in a massive debt swap even as interest rates soared.”Deposits and the value of the peso and dollar in Argentina are untouchable and guaranteed. Those who disbelieve or mistrust will end up losing out,” he said. In the 1980spersonal savings were converted into government bonds overnight at a poor rate of exchange. Recently, government employees took to the streets in protest after their salaries were paid in bonds.To counter worries that savings in pesos will be devalued while locked inside bank vaults, officials have promised to permit depositors to convert their peso accounts into US dollars without charge.Overseas and offshore transfers of more than $1,000 will be severely restricted in the coming months. The government will also forbid new bank loans in pesos, and insist financial institutions lend only in dollars. Business leaders read that as a signal that the government is about to ditch the peso for the US dollar as the national currency. The peso is already considered overvalued, which makes it difficult for Argentina to compete with neighbouring Brazil and Chile.

But President De la Rua denied he would tamper with the currency’s value or step down.Union leaders called the banking measures “the hijacking of a nation’s savings,” and said strikes may be called for next week.. Anthony Zinni, the US envoy to the Middle East, was booed yesterday as he laid a wreath of yellow flowers at the site of a suicide bomb attack that killed 10 people and injured scores of others a few metres from his hotel in Jerusalem. Many believe the bombings in Jerusalem and Haifa were timed to coincide with his visit. But Mr Zinni vowed that his job heading President George Bush’s most determined effort yet to broker peace would continue.He is used to tough situations.

Before he retired in July 2000, the Marine general was commander-in-chief of the US Central Command, which covers Afghanistan and central Asia.This time his job is to wage peace. Mr Zinni was dispatched by Colin Powell, the US Secretary of State, for “as long as it takes”. Mr Powell said he had total confidence in Mr Zinni’s ability to succeed where legions of others have failed ­ his credentials as a soldier set to impress the security-fixated Mr Sharon. “You’ll see what pushing and prodding is when Tony Zinni gets on the ground,” Mr Powell said.But plenty of others have voiced scepticism. Haaretz, an Israeli newspaper, ran a cartoon showing Mr Zinni ­ his chest decorated with ribbons and his epaulets full of stars ­ about to step into a pile of dog mess.The Bush administration’s approach to the Middle East has been at best lukewarm.

At worst, it was founded on the determination not to be dragged into long, unsolvable negotiations that could tarnish the President’s prestige with failure ­ a consequence that hurt the previous president, Bill Clinton.But Mr Bush was forced to shift that position after 11 September, when it became clear that the so-called war on terrorism had to go hand-in-hand with finding a solution to the Israeli-Palestinian struggle. America now faces the problem of responding to any military retaliation from Israel without upsetting the Arab and Muslim countries it relies on for support for its campaign in Afghanistan.. The message of the right flank of Ariel Sharon’s coalition to George Bush was simple: You’ve sent the bombers and the marines to fight terrorism in Afghanistan. Stop telling us to show restraint in fighting terrorism in our own back yard. Activists of the Kach movement, barred from parliament as racists, demonstrated at the scene of the Jerusalem suicide bombing, chanting: “Death to the Arabs.” They always do, but there were more of them this time.Ruby Rivlin, the Communications Minister, said: “Israel can’t go on any longer with this situation We are in a war They are killing us every day We have to protect ourselves. It’s not our right, it’s our duty.” What did Mr Rivlin propose? “Arafat has to fight the terrorists.