Periscope

Brazil + Lula's under fierce pressure to start spending. But he's also desperate to win over swing voters in fall local elections. He'll hold the fiscal reins tight.

Israel + Desperate for allies, P.M. Sharon has given Finance Minister Netanyahu the room to push through vital banking reforms. They'll outlast the political turmoil.

Georgia - Prez Saakashvili is a fresh face, but inexperienced. His hotheaded posturing may be dooming hopes for a peaceful settlement with breakaway Adjaria region.

THAILAND
Tough Times for Thaksin

Thai officials are talking tough about the bloodbath in the southern half of the country last week, in which they say 107 Islamic militants were killed in attacks on police and Army posts in several towns. (Some locals claim that several of the dead were innocent civilians.) Thai intelligence sources say they were tipped off about the predawn raids by some 200 attackers several hours beforehand, but could not get as many troops as they would have liked in place. "If they were able to confirm it earlier, nobody would have gotten away," says one source.

Officials insist the attacks are not the work of foreign terrorists. They say the attackers were local Muslim separatists, financed by drug smugglers. The latter have been crippled by Bangkok's anti-drug crackdown and would presumably welcome any help in disrupting government activities in the area.