Germany drafts law on banking separation






BERLIN: Germany aims to introduce legislation on banking separation in order to protect customers' deposits from riskier areas of business, according to a draft law seen by AFP on Wednesday.

The government wants the law to come into effect in January 2014 and banks' activities to be separated by July 2015.

It will only apply to institutions with balances sheets over 1.0 billion euros or with risky positions worth 20 pe rcent of the balance sheet value, according to the law.

The rules would affect Germany's two biggest banks, Deutsche Bank and Commerzbank, as well as regional banking giant Landesbank Baden-Wuerttemberg (LBBW).

Banking separation is an idea floated by the head of the Finnish central bank and European Central Bank governing council member Erkki Liikanen as a measure for reducing risk in the banking sector.

But one of Deutsche Bank's co-chief executives, Anshu Jain, has repeatedly slammed the idea, saying it would "greatly harm the German economy and German companies."

He argues that if Deutsche Bank can no longer use deposits to refinance its activities in investment banking, the refinancing costs would automatically rise and that would narrow the financing possibilities of major companies.

At the same time, banks with high deposits would find it difficult to find attractive investments for customers, Jain said.

- AFP/jc



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Official Stratego game debuts for iPad




Stratego for iPad lets you play against the computer or any number of online opponents, including those on the Web and Facebook.

Stratego for iPad lets you play against the computer or any number of online opponents, including those on the Web and Facebook.



(Credit:
Screenshot by Rick Broida/CNET)


Remember Stratego? It's the classic capture-the-flag boardgame. And it's now available for iPad.


Why just
iPad? I'm not entirely sure. Granted, the board would be cramped on an iPhone or
iPod Touch screen, but I've seen plenty of other games work around that. (Monopoly, anyone?)


That curiosity aside, Stratego for iPad does a fine job recreating the original while adding some welcome digital touches. For starters, you can create and save multiple board setups (i.e., troop deployments), a huge time-saver and a great way to test how various deployments work against your opponents.


And speaking of opponents, the app lets you play against a virtually unlimited supply of other humans, be they on Facebook, the Web, or another iPad. Yep, the game supports cross-platform play, so you can tackle Facebook friends just as easily as you would your fellow iPad owners.


Of course, Web and Facebook strategists (Stratego-ists?) get to play for free. On the iPad it'll cost you $6.99 for the privilege. That strikes me as a little steep, though it's a good bet it'll be cheaper down the road. (Use an app like Appsfire Deals to track its price.) What's more, you must buy "battle coins" if you want to unlock new avatars, battlefields, and other game content. That would be fine if this were a freemium title, but here it seems a little greedy.


The iPad version requires you to create an account or sign in via Facebook (sorry -- no GameCenter support), even if you want single-player action against the computer. That's insanely annoying, but at least there's a workaround: turn off Wi-Fi (and/or 3G if you have it) before launching the game. If it doesn't detect an Internet connection, it'll let you play offline. Like I said: annoying.




Unfortunately, I saw a lot of this message during testing.

Unfortunately, I saw a lot of this message during testing.



(Credit:
Screenshot by Rick Broida/CNET)


I also found Stratego to be pretty buggy, alternately crashing, producing error messages, or having trouble signing into Facebook. Plus, the AI is what I'd call overly aggressive, as it never forgets the location of your pieces (once revealed) the way a human would. I won't say beating the AI is impossible, but at the very least the game should offer a choice of skill levels.


The good news is that when you're playing against another person, Stratego is just as much fun as you remember. (If you remember it being aggravating, well, it's just as aggravating as you remember. "Who puts a bomb there?!!") I'd consider waiting for the price to drop a few bucks and the bugs to get cleaned up. But if you can't wait, well, I'll see you on the battlefield.


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Three hurt in Phoenix office shooting, one critical


Scene outside a Phoenix, Ariz., office building where three people reportedly were injured in a shooting on Jan. 30, 2013


/

KPHO

(CBS) -- Phoenix police said three people were injured in the Wednesday morning shooting at a Phoenix office building, CBS affiliate KPHO reports.

Police said the shooting suspect fired multiple rounds in what they believe was not a random attack. One person was critically injured while the other two victims had less severe injuries, according to the station.

Police are gathering details on the suspect and surrounded his home, interviewing his adult son, KPHO reports. Police said the suspect is married and they are trying to locate his wife.

Police believe the alleged gunman rented a white car before going to the building near 16th and Glendale Avenue. They said they believe he had issues with his home mortgage, according to the station.

More on Crimesider
Jan. 20, 2013 - Several people injured in Phoenix office building shooting, report says


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Phoenix Gunman Shoots Three at Office Complex













A gunman shot and wounded three people at an office building in Phoenix, Ariz., today and police are now searching for the shooter, authorities told ABC News.


There are no reports of deaths at this time.


Police are clearing the office complex in the in the 7310 block of 16th Street, near Glendale Avenue.


Officials say there was only one gunman, who remains at large.


A witness told ABC News she heard several shots, and took cover in an IT closet with several other women. Another witness heard between six and 10 shots fired.








Minnesota Office Shooting: 5 Dead, 4 Wounded Watch Video









Theater Shooting Sparks Release of Safety Video Watch Video







Police are also investigating a separate scene near Glendale Avenue, according to ABC News affiliate KNXV-TV. It's not clear if it's related to the office shooting.


The shooting took place moments after former Arizona congresswoman Gabrielle Giffords, the victim of a shooting in Phoenix in 2011, testified before Congress on gun control.


In the weeks since 20 students were gunned down at a Newtown, Conn., elementary school on Dec. 14, 2012, several mass shootings have garnered public attention as the nation debates its relationship to firearms.


Five days ago, two men were wounded during a shooting at Lone Star College in Houston, Texas. Earlier this month, a 16-year-old student was arrested after shooting a classmate in Taft, Calif.



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Egypt curfew scaled back as Mursi seeks end to bloodshed


CAIRO/BERLIN (Reuters) - Egyptian authorities scaled back a curfew imposed by President Mohamed Mursi, and the Islamist leader cut short a visit to Europe on Wednesday to deal with the deadliest violence in the seven months since he took power.


Two more protesters were shot dead before dawn near Cairo's central Tahrir Square on Wednesday, a day after the army chief warned that the state was on the brink of collapse if Mursi's opponents and supporters did not end street battles.


More than 50 people have been killed in the past seven days of protests by Mursi's opponents marking the second anniversary of the uprising that toppled Hosni Mubarak.


Mursi imposed a curfew and a state of emergency on three Suez Canal cities on Sunday - Port Said, Ismailia and Suez. That only seemed to further provoke crowds. However, violence has mainly subsided in those towns since Tuesday.


Local authorities pushed back the start of the curfew from 9:00 p.m. to 2:00 a.m. in Ismailia and to 1:00 a.m. in Port Said and Suez.


"There has been progress in the security situation since Monday. Calm has returned," Suez Governor Samir Aglan said.


Mursi, speaking in Berlin before hurrying home to deal with the crisis, called for dialogue with opponents but would not commit to their demand that he first agree to include them in a unity government.


He sidestepped a question about a possible unity government, saying the next cabinet would be formed after parliamentary elections in April.


Egypt was on its way to becoming "a civilian state that is not a military state or a theocratic state", Mursi said.


The violence at home forced Mursi to scale back his European visit, billed as a chance to promote Egypt as a destination for foreign investment. He flew to Berlin but called off a trip to Paris and was due back home after only a few hours in Europe.


Chancellor Angela Merkel, who met him, echoed other Western leaders who have called on him to give his opponents a voice.


"One thing that is important for us is that the line for dialogue is always open to all political forces in Egypt, that the different political forces can make their contribution, that human rights are adhered to in Egypt and that of course religious freedom can be experienced," she said at a joint news conference with Mursi.


SPIRIT OF REVOLUTION


Mursi's critics accuse him of betraying the spirit of the revolution by keeping too much power in his own hands and those of his Muslim Brotherhood, the Islamist movement banned under Mubarak which won repeated elections since the 2011 uprising.


Mursi's supporters say the protesters want to overthrow Egypt's first democratically elected leader. The current unrest has deepened an economic crisis that saw the pound currency tumble in recent weeks.


Near Cairo's Tahrir Square on Wednesday morning, dozens of protesters threw stones at police who fired back teargas, although the scuffles were brief.


"Our demand is simply that Mursi goes, and leaves the country alone. He is just like Mubarak and his crowd who are now in prison," said Ahmed Mustafa, 28, a youth who had goggles on his head to protect his eyes from teargas.


Opposition politician Mohamed ElBaradei called for a meeting of the president, ministers, the ruling party and the opposition to halt the violence. But he also restated the precondition that Mursi first commit to seeking a national unity government.


The worst violence has been in the Suez Canal city of Port Said, where rage was fuelled by death sentences passed against soccer fans for roles in deadly riots last year.


After decades in which the West backed Mubarak's military rule of Egypt, the emergence of an elected Islamist leader in Cairo is probably the single most important change brought about by the wave of Arab revolts over the past two years.


Mursi won backing from the West last year for his role in helping to establish a ceasefire between Israel and Palestinians that ended a conflict in Gaza. But he then followed that with an effort to fast-track a constitution that reignited dissent at home and raised global concern over Egypt's future.


Western countries were alarmed this month by video that emerged showing Mursi making vitriolic remarks against Jews and Zionists in 2010 when he was a senior Brotherhood official.


German Foreign Minister Guido Westerwelle said ahead of Mursi's visit that the remarks, in which Mursi referred to Zionists as "descendants of apes and pigs" were "unacceptable".


"NOT AGAINST JEWS"


Asked about those remarks at the news conference with Merkel, Mursi repeated earlier explanations that they had been taken out of context.


"I am not against the Jewish faith," he said. "I was talking about the practices and behavior of believers of any religion who shed blood or who attack innocent people or civilians. That's behavior that I condemn."


"I am a Muslim. I'm a believer and my religion obliges me to believe in all prophets, to respect all religions and to respect the right of people to their own faith," he added.


Egypt's main liberal and secularist bloc, the National Salvation Front, has so far refused talks with Mursi unless he promises a unity government including opposition figures.


"Stopping the violence is the priority, and starting a serious dialogue requires committing to guarantees demanded by the National Salvation Front, at the forefront of which are a national salvation government and a committee to amend the constitution," ElBaradei said on Twitter.


Those calls have also been backed by the hardline Islamist Nour party - rivals of Mursi's Brotherhood. Nour and the Front were due to meet on Wednesday, signaling an unlikely alliance of Mursi's critics from opposite ends of the political spectrum.


Brotherhood leader Mohamed El-Beltagy dismissed the unity government proposal as a ploy for the Front to take power despite having lost elections. On his Facebook page he ridiculed "the leaders of the Salvation Front, who seem to know more about the people's interests than the people themselves".


In a sign of the toll the unrest is having on Egypt's economy, ratings agency Fitch downgraded its sovereign rating by one notch to B on Wednesday.


(Additional reporting by Tom Perry, Yasmine Saleh and Marwa Awad in Cairo, Yusri Mohamed in Ismailia and Stephen Brown and Gernot Heller in Berlin; Writing by Peter Graff)



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78 bodies found 'executed' in Syria river






ALEPPO: The bodies of 78 young men, all executed with a single gunshot, were found Tuesday in a river in Aleppo city, adding to the grim list of massacres committed during Syria's 22-month conflict.

The gruesome discovery came ahead of a briefing by peace envoy Lakhdar Brahimi to the UN Security Council on the uprising, which the United Nations says has left more than 60,000 people dead.

Abu Seif, a rebel fighter, said 78 bodies were retrieved from the Quweiq River and that 30 more were still in the waters but out of reach because of regime snipers.

"The regime threw them into the river so that they would arrive in an area under our control, so the people would think we killed them," he said.

But a security official accused "terrorists," the regime term for the rebels, of the killings, adding the victims were residents kidnapped from the opposition-held district of Bustan al-Qasr.

Their families had tried to negotiate their release before they were killed overnight, he said.

There was no immediate claim of responsibility, but the official SANA news agency said the jihadist Al-Nusra Front carried out the executions.

"Terrorist groups from Al-Nusra Front in Aleppo carried out a mass execution of dozens of abducted people and threw their bodies in the Quweiq River," the agency said.

Al-Nusra, which first gained notoriety for its suicide bombings in Syria, has evolved into a formidable fighting force leading attacks on battlefronts throughout the embattled country.

Its extremist tactics and suspected affiliation to the Al-Qaeda offshoot in Iraq have landed it on the US list of terrorist organisations.

The Syrian Observatory for Human Rights gave a toll of 65 bodies but warned the figure could rise significantly.

"They are in their 20s and were executed by a bullet to the head. Most of them had their hands tied behind their backs and were in civilian clothes," said the watchdog.

The scene on the bank of the Quweiq was grim, as muddied corpses are dredged out of the water and hundreds of distressed people flocked around to see if they could spot among the bodies a father, a brother, a son or a husband.

"My brother disappeared weeks ago when he was crossing (through) the regime-held zone, and we don't know where he is or what has become of him," said Mohammed Abdel Aziz.

Volunteers helped place on a truck the bodies which were then taken to a school where they were laid out and covered in a blue cloth.

"We do not know who they are -- they were not carrying papers," a volunteer said as an AFP correspondent counted at least 15 bodies on one truck.

A number was placed next to each body and their faces were left uncovered to allow the identification by relatives at the school, where the nauseating stench of death lingers.

"There are those who drowned because they were shot in the legs or abdomen before being thrown into the water," said a nurse, noting some victims may have been killed as far back as three days ago.

The 129-kilometre river originates in Turkey to the north and flows to the southwest of Aleppo, traversing both regime and rebel-held areas.

"This is not the first time that we have found the bodies of people executed, but so many, never," rebel fighter Abu Anas said as he examined the body of a boy of about 12 with a gunshot wound to the back of the neck.

"Jews would not have done this. Their only crime was that they were residents of Bustan al-Qasr and they were Sunni Muslims," a man cried out as he looked down at several of the bodies laying on the pavement waiting to be identified.

Violence raged elsewhere in Aleppo province, where seven children were killed in air strikes on the town of Safireh, the Observatory said, giving a toll of 91 people killed across Syria on Tuesday.

And in Damascus a member of parliament was seriously injured when a explosive device strapped to his car exploded, the Observatory said.

The bloodshed came as rebels captured a vital bridge across the Euphrates River in Deir Ezzor city, largely severing an army supply route to Hasakeh province further north.

The nearby regime security headquarters and a smaller bridge were also captured, prompting retaliatory air strikes on the critical crossings.

"These gains in Deir Ezzor are very important because this strategic city is the gateway to a region rich in oil and gas resources," said Observatory director Rami Abdel Rahman.

"If the rebels continue to progress and gain control of what is left of military-held positions... it will be the first major city to fall into the hands of the rebels," said Abdel Rahman.

On the humanitarian front charity organisations on Tuesday pledged US$182 million for Syrians displaced at home or who have fled abroad because of the conflict on the eve of a donors conference in Kuwait.

US President Barack Obama announced an extra US$155 million dollars to aid refugees fleeing what he said was "barbarism" propagated by the government of Syrian President Bashar al-Assad.

- AFP/jc



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How and where to buy Office 365



Office 2013 keeps you connected everywhere





Along with all the new features, the version of Microsoft Office revealed today (read CNET's review) is now available both as a standalone suite and by subscription. The options are tailored towards different use cases, depending on your productivity requirements.


Office 365 Home Premium, $99.99 per year, five PCs/Macs/Windows tablets: This is the "Microsoft recommended" version of Office. It comes with Word, Excel, PowerPoint, Outlook, OneNote, Publisher, Access, 20 GB of SkyDrive storage, 60 global minutes per month on Skype, and Office on Demand for always-available Web access to the full suite. The 30-day free trial remains unchanged.




Microsoft isn't promoting this heavily, but you can also buy a monthly subscription to Office 365 Home Premium directly from Microsoft. You get all the same features as the annual subscription, but you're only shedding $9.99 per month for the privilege. The annual is the better long-term deal.


Office 365 University, $79.99 for four years, two PCs/Macs: This version is for students and faculty, as you can tell by that college-targeted four-year license. It offers the same features as Office 365 Home Premium, including the Skype minutes and SkyDrive storage.


Office Home and Student 2013, $139.99 per year, one PC: This is the traditional one-computer, home-only license that has been the mainstay of Office pricing throughout its history. Think of it as the "retro" option. It comes with Word, Excel, PowerPoint, and OneNote. It offers none of the Office 365 extras, and Microsoft recommends it for families that share one central computer at home.



Microsoft Word 2013 running on Windows 8.



(Credit:
James Martin/CNET)



Office Home and Business 2013, $219.99 per year, one PC: The business license single-computer edition offers the same features as Home and Student 2013, but includes Outlook. Again, no Office 365 extras to be found here, but Microsoft clearly recognizes that forcing everybody to a subscription would be adverse to their bottom line.


Office Professional 2013, $399.99 per year, one PC: The souped-up business license single-computer edition offers the same features as Home and Business 2013, but includes Access and Publisher. Like Home and Office 2013, it follows the traditional Office suite components and pricing.


There are enterprise versions of Office 365, as well, that include bulk licensing options such as group policy, telemetry, and contextual access to business and social networking.


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Arm transplant vet looking forward to swimming, diving

BALTIMORE A soldier who lost all four limbs in an Iraq roadside bombing says he looks forward to driving and swimming with his new arms.

Twenty-six-year-old Brendan Marrocco spoke at a news conference Tuesday at Johns Hopkins Hospital in Baltimore. He was joined by the surgeons who performed the double-arm transplant there.

Marrocco says he's happy and amazed to have new arms. He has prosthetic legs but says that without arms, he felt "kind of lost for a while."

"It's given me a lot of hope for the future," Marrocco said. "I feel like it's given me a second chance."



The procedure was only the seventh double-hand or double-arm transplant ever conducted in the United States.

Dr. W. P. Andrew Lee, the lead surgeon on Marrocco's team, said this surgery "was the most extensive and complicated" transplant surgery ever performed, involving the connecting of bone, nerves, blood vessels, muscles, and other tissue. He said his team had rehearsed four times on cadavers in the last two years.


Marrocco said he already can twist the wrist in his left arm, which had a lower amputation than the right, allowing doctors to begin that arm transplant at his elbow. Lee said nerves regrow at about an inch per month, so given the length of an arm, it will take several months to more than a year for most normal arm movements to occur with Marrocco.


Lee said Marrocco, a New York native, will check out of the hospital Tuesday, and begin outpatient therapy while staying nearby for several months.


The infantryman was injured by a roadside bomb in 2009. The New York City man also received bone marrow from the same dead donor to minimize the medicine needed to prevent rejection.

The military is sponsoring operations like these to help wounded troops. About 300 have lost arms or hands in the wars.

Through all the procedures and the recovery, Marrocco has generally maintained a positive attitude.





Play Video


Young Injured Vet Tells Story



In a 2010 interview with CBS News correspondent David Martin (at left), he said: "I just seem to have a good lookout on things. I'm still alive. My buddy wasn't as fortunate."

Marrocco was referring to one of the other members of his squad, whom he described as his best friend, who was killed when their Humvee ran over a tripwire.

"I remember the flash, the sound, it was ridiculously loud. I remember all the screaming in the truck trying to see who was hurt. After that I remember waking up in the hospital," Marrocco said.

He described the thing that took his limbs as a "copper dart" that was "molten hot," saying it "cauterized my wounds." The New York native said he has marveled at the fact that he survived, when others did not, adding that his friend who died "wasn't hurt nearly as bad as I was."

Even after waking up in the hospital and realizing that he lost his arms, Marrocco said his father told him his reaction was relatively nonchalant, saying "I just shrugged my shoulders and went back to sleep."

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Palin and Fox Part Ways, but Is She Really Over?













Sarah Palin's break up with Fox News should not have been, well, breaking news, as she had publicly complained in August on Facebook that the network had canceled her appearances at the Republican National Convention. And going back even further, Palin didn't give Fox the scoop in October 2011 when she announced she wasn't going to run for president. Still, the news of the Fox split overtook Twitter and the news cycle by storm.


One thing I've learned in my years covering Palin, which began on Aug. 29, 2008, when Sen. John McCain stunned the country by selecting her as his running mate: Everyone has an opinion on whatever she does, and she can get clicks and coverage like no one else.


The prevailing theory now is that since Palin no longer has a megaphone like Fox News through which she can blast her opinions, her moment is now officially over.


The 'Ends' of Sarah Palin


It might be true, but there have been so many "ends of Sarah Palin" that it's almost too hard to keep track of them all. She was over when she lost the 2008 campaign, she was over when she quit the Alaska governorship, she was over when she decided to do a reality show, she was over when she decided not to run for president, and now again, she's over because her appearances on Fox News are over.












Secret Service Scandal: Fired Agent 'Checked Out' Sarah Palin Watch Video





I, for one, did think Palin would lose her relevancy when she quit the Alaska governorship, and also when she didn't run for president. But in both cases, people who both love her and hate her just couldn't get enough information about her, and she still got an incredible amount of news coverage. Her voice was heard loud and clear, even if it blasted only from her Facebook posts. That's just another example of what she's been able to pull off that others who've come before or after just haven't. Palin's been written off from Day One, but like a boomerang, she just keeps coming back.


Yes, she wasn't really helpful to Mitt Romney's campaign, but she also never really explicitly backed him. And what an odd pair they would have made if she had. In her interview last weekend with Steve Bannon, the executive chairman of Breitbart News who made "The Undefeated," the positive 2011 movie about her, she said, "The problem is that some on the right are now skittish because of the lost 2012 election. They shouldn't be. Conservatism didn't lose. A moderate Republican candidate lost after he was perceived to alienate working-class Reagan Democrats and independent voters." Not a sign that she wants to rethink some of her policy points, or that she will retreat into the shadows.


Another Possible TV Home


I think more likely than her fading away (we all still cover every eyebrow-raising Facebook post of hers) is that she will possibly find an on-air home elsewhere, at somewhere like CNN. She told Breitbart.com that she "encourages others to step out in faith, jump out of the comfort zone, and broaden our reach as believers in American exceptionalism. That means broadening our audience. I'm taking my own advice here as I free up opportunities to share more broadly the message of the beauty of freedom and the imperative of defending our republic and restoring this most exceptional nation. We can't just preach to the choir; the message of liberty and true hope must be understood by a larger audience."


Later in the interview, she added, "I know the country needs more truth-telling in the media, and I'm willing to do that. So, we shall see."






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Army warns unrest pushing Egypt to the brink


CAIRO, Egypt (Reuters) - Egypt's army chief said political unrest was pushing the state to the brink of collapse - a stark warning from the institution that ran the country until last year as Cairo's first freely elected leader struggles to curb bloody street violence.


Abdel Fattah al-Sisi, a U.S.-trained general appointed by President Mohamed Mursi last year to head the armed forces, added in a statement on Tuesday that one of the primary goals of deploying troops in cities on the Suez Canal was to protect the waterway that is vital for Egypt's economy and world trade.


Sisi's comments, published on an official army Facebook page, followed 52 deaths in the past week of disorder and highlighted the mounting sense of crisis facing Egypt and its Islamist head of state who is striving to fix a teetering economy and needs to prepare Egypt for a parliamentary election in a few months that is meant to cement the new democracy.


Violence largely subsided on Tuesday, although some youths again hurled rocks at police lines in Cairo near Tahrir Square.


It seemed unlikely that Sisi was signaling the army wants to take back the power it held for six decades since the end of the colonial era and through an interim period after the overthrow of former air force chief Hosni Mubarak two years ago.


But it did send a powerful message that Egypt's biggest institution, with a huge economic as well as security role and a recipient of massive direct U.S. subsidies, is worried about the fate of the nation, after five days of turmoil in major cities.


"The continuation of the struggle of the different political forces ... over the management of state affairs could lead to the collapse of the state," said General Sisi, who is also defense minister in the government Mursi appointed.


He said the economic, political and social challenges facing the country represented "a real threat to the security of Egypt and the cohesiveness of the Egyptian state" and the army would remain "the solid and cohesive block" on which the state rests.


Sisi was picked by Mursi after the army handed over power to the new president in June once Mursi had sacked Field Marshal Hussein Tantawi, in charge of Egypt during the transition and who had also been Mubarak's defense minister for 20 years.


The instability has provoked unease in Western capitals, where officials worry about the direction of a powerful regional player that has a peace deal with Israel. The United States condemned the bloodshed and called on Egyptian leaders to make clear violence was not acceptable.


DEEPLY POLARISED


The 58-year-old previously headed military intelligence and studied at the U.S. Army War College. Diplomats say he is well known to the United States, which donates $1.3 billion in military aid each year, helping reassure Washington that the last year's changes in the top brass would not upset ties.


One of Sisi's closest and longest serving associates, General Mohamed el-Assar, an assistant defense minister, is now in charge of the military's relations with the United States.


Almost seven months after Mursi took office, Egyptian politics have become even more deeply polarized.


Opponents spurned a call by Mursi for talks on Monday to try to end the violence. Instead, protesters have rallied in Cairo and Alexandria, and in the three Suez Canal cities - Port Said, Ismailia and Suez - where Mursi imposed emergency rule.


On Tuesday, thousands were again on the streets of Port Said to mourn the deaths of two people in the latest clashes there, taking the total toll in Mediterranean port alone to 42 people. Most were killed by gunshots in a city where weapons are rife.


Mohamed Ezz, a Port Said resident speaking by telephone, heard heavy gunfire through the night. "Gunshots damaged the balcony of my flat, so I went to stay with my brother," he said.


Residents in the three canal cities had taken to the streets in protest at a nightly curfew now in place there. The president's spokesman said on Tuesday that the 30-day state of emergency could be shortened, depending on circumstances.


In Cairo on Tuesday afternoon, police again fired teargas at stone-throwing youths in a street near Tahrir Square, the center of the 2011 uprising. But the clashes were less intense than previous days and traffic was able to cross the area. Street cleaners swept up the remains of burnt tires and other debris.


The police have been facing "unprecedented attacks accompanied by the appearance of groups that pursue violence and whose members possess different types of weapons", the state news agency reported, quoting the Interior Ministry spokesman.


Street flare-ups are a common occurrence in divided Egypt, frustrating many people desperate for order and economic growth.


WARY MILITARY


Although the general's comments were notably blunt, Egypt's military has voiced similar concerns in the past, pledging to protect the nation. But it has refused to be drawn back into a direct political role after its reputation as a neutral party took a pounding during the 17 months after Mubarak fell.


"Egyptians are really alarmed by what is going on," said Cairo-based analyst Elijah Zarwan, adding that the army was reflecting that broader concern among the wider public.


"But I don't think it should be taken as a sign that the military is on the verge of stepping in and taking back the reins of government," he said.


In December, Sisi offered to host a national dialogue when Mursi and the rivals were again at loggerheads and the streets were aflame. But the invitation was swiftly withdrawn before the meeting went ahead, apparently because the army was wary of becoming embroiled again in Egypt's polarized politics.


Protests initially flared during the second anniversary of the uprising which erupted on January 25, 2011 and toppled Mubarak 18 days later. They were exacerbated in Port Said when residents were angered after a court sentenced to death several people from the city over deadly soccer violence.


Since the 2011 revolt, Islamists who Mubarak spent his 30-year rule suppressing have won two referendums, two parliamentary elections and a presidential vote.


But that legitimacy has been challenged by an opposition that accuses Mursi of imposing a new form of authoritarianism. Mursi's supporters says protesters want to overthrow Egypt's first democratically elected leader by undemocratic means.


The army has already been deployed in Port Said and Suez and the government agreed a measure to let soldiers arrest civilians as part of the state of emergency. Sisi reiterated that the army's role would be to support the police in restoring order.


Mursi's invitation to rivals to a national dialogue with Islamists on Monday was spurned by the main opposition National Salvation Front coalition, which described it as "cosmetic".


The presidency said a committee would be formed to look at changes to the constitution, but it ruled out changing the government before the parliamentary election.


Mursi's pushing through last month of a new constitution which critics see as too Islamic remains a bone of contention.


(Additional reporting by Yasmine Saleh and Omar Fahmy in Cairo, Yusri Mohamed in Ismailia and Abdelrahman Youssef in Alexandria; Writing by Edmund Blair; Editing by Alastair Macdonald and Peter Millership)



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