At 18, he was rejected from every major London drama school before throwing in the towel to move to America, go backpacking and become a handyman.

This weekend, on the eve of the Tony Awards, actor Alex Sharp has had the last laugh.

The young British actor will on Sunday night take on acting titans Bill Nighy, Bradley Cooper and Ben Miles for the coveted title of best actor on Broadway, after winning the starring role in The Curious Incident of the Dog in the Night-Time.

It was his first and only audition for the New York stage, after training at Juilliard on the casual recommendation of a friend and graduating last year.

Sharp, who was born in London and grew up in Devon, will now be counted among the greatest actors on Broadway this year after being honoured by the Tony Awards, as he admits his extreme recent trajectory to stardom has been “crazy”.

He will be one of many British actors waiting anxiously to hear the results of the awards ceremony in New York tonight, including Dame Helen Mirren, Carey Mulligan, and fellow 20-something British newcomer Matthew Beard.

Beard too has experienced a remarkable rise to fame, winning his first ever stage role in Skylight, alongside Mulligan and Nighy, transferring with the play to Broadway and now being nominated for best featured actor on stage at the Tonys.

He made his television debut aged four in A Touch of Frost, spending his £10 fee on an Action Man, and told the Telegraph no-one had been “brave or stupid” enough to give him his stage debut until award-winning director Stephen Daldry took a chance on him.

Sharp, 26, made his first foray into acting aged seven at primary school in Devon, where he took on the role of piglet in Winnie the Pooh.

After catching the acting bug, and struggling to concentrate at school, he went on to appear in amateur productions in the south of England before applying to drama school.

“I got rejected from all the good drama schools first time,” he said. “It’s nice to know that there might be some kid getting rejected from a big drama school this year who might now realise it’s not the end.”

Instead, he travelled to the United States where he lived life as a “nomad”, travelling and taking on casual handyman jobs.

One day, as he painted a house in Connecticut, he asked where the best places to study drama were. As Juilliard was $10 cheaper than Yale, he auditioned and, after a small white lie to hide the fact he was breaking convention to perform his own work, got in.

“As an actor, you spend years getting ready for an opportunity to arise and when it does you’re ready for it,” he said, disclosing Curious Incident was his first and only audition for post-graduation work.

“I leapt at the chance.”

Sharp found out he had been nominated for a Tony Award by watching the announcement on television in a wood cabin in upstate New York, with his girlfriend Wallis Currie-Wood by his side.

“I’m really excited, and nervous obviously,” he said ahead of tonight’s ceremony. “I’ve never been before so I don’t know what to expect. It’s pretty crazy.”

He added he had not prepared an acceptance speech for superstitious reasons.

He will be among many familiar faces in Radio City Music Hall, with a host of British plays and actors up for awards.

Among them is Beard, 26, who has an equally astonishing rise to theatre fame after taking on his very first stage role in Skylight.

After appearing in television and film as a child, he said, no-one had been willing to audition him for a play because of his lack of experience until Stephen Daldry took the plunge.

“All I hoped for on opening night was that I didn’t get fired the next day,” he said, of his debut in London. “I had a speech prepared on why I shouldn’t get fired, about how I was going to improve.

“I definitely did not think I would be up for a Tony nomination. It does feel like quite an odd thing, but I’m very grateful.”

He too has not prepared a victory speech, after his family teased him by pointing out he had the lowest odds for winning his category at the bookies.

Among the other British hopefuls include Ruth Wilson for Constellations, Nathaniel Parker and Lydia Leonard for Wolf Hall and Richard McCabe for The Audience.

Wolf Hall: Parts One and Two has eight nominations overall, while Skylight has seven, Curious Incident six and The Audience three.

Curious Incident and The Audience are both still playing in the West End, with tickets available now.

This article was written by Hannah Furness from The Daily Telegraph and was legally licensed through the NewsCred publisher network.

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The kingdom’s ambassador to London tells the Telegraph that 'all options are on the table’ if talks fail to keep Iran in check

Since its creation 85 years ago, Saudi Arabia has acquired a reputation as a country that tries to avoid confrontation with its neighbours at all costs.

During the long war between Iran and Iraq during the 1980s the Saudis desperately sought to preserve their neutrality, even if Riyadh’s sympathies lay with its fellow Sunni co-religionists in Iraq rather than the Shi’ite Muslim hardliners running Iran.

Similarly, Saudi Arabia’s involvement in the two Gulf wars against Saddam Hussein was kept to a minimum. Saudi warplanes made a modest contribution to the overall air campaign during the 1991 liberation of Kuwait, while Riyadh steadfastly refused to involve itself in the 2003 Iraq war.

In other conflicts affecting the region, such as the Palestinian intifada, the Saudis have preferred to channel their immense oil wealth in support of Arab allies rather than become directly involved in the strife.

But then this year came Saudi Arabia’s dramatic military intervention in neighbouring Yemen. Saudi warplanes and troops are now involved in a bitter conflict with Iranian-backed rebels from the Houthi religious movement in Yemen. And Saudi Arabia has been confirmed as one of the region’s dominant military powers.

In the past two years, it has beaten Britain into fourth place in the world’s military spending league with a defence budget of around £37 ($56.5)  billion (compared with the UK at around £34 ($52) billion). The military offensive in Yemen has seen Saudi Arabia deploy an estimated 150,000 troops – nearly twice the size of the British Army – while Saudi fighter jets, many of them British-made, have flown thousands of sorties.

Now the Saudis have raised the alarming prospect of the Middle East becoming embroiled in a nuclear arms race after the country’s blunt warning that “all options are on the table” if Iran fails to resolve the international stand-off over its nuclear programme.

Prince Mohammed bin Nawwaf bin Abdulaziz al-Saud, Saudi Arabia’s long-serving ambassador to London, says that for many years the kingdom upheld the policy established by the late King Fahd that Riyadh would not pursue a policy of developing nuclear weapons.

“Then it became known that Iran was pursuing a policy that could be shifted to a weapons-of-mass-destruction programme,” Prince Mohammed explained in an exclusive interview with The Daily Telegraph. “This has changed the whole outlook in the region.”

Like many in the Arab world and beyond, the Saudis are hoping the current negotiations with Iran on the nuclear issue, being led by US President Barack Obama, will provide assurances that Tehran does not possess the means to build an atom bomb.

“We have always expressed our support for resolving the Iranian nuclear file in a diplomatic way and through negotiation,” said Prince Mohammed. “We commend the American president’s effort in this regard, provided that any deal reached is watertight and is not the kind of deal that offers Iran a licence to continue its destabilising foreign policies in the region. The proof is in the pudding.”

Negotiations between Iran and the P5+1 – the US, the UK, France, China and Russia (the five permanent members of the UN Security Council) and Germany – are due to be concluded by the end of this month. Negotiators are pressing Tehran to freeze key elements of its uranium-enrichment cycle – which can be used to produce nuclear warheads – in return for easing the sanctions that have crippled the Iranian economy.

Despite attempts lasting more than a decade to resolve the issue, Iran has yet to make any significant concessions on its nuclear programme. The New York Times reported last week that Tehran’s stockpile of nuclear fuel had increased by 20 per cent in the past 18 months . That would make a nonsense of the Obama administration’s contention that Iran had frozen its enrichment operations for the duration of the negotiations. Consequently, there are fears in Saudi Arabia and the other Gulf states that Mr Obama is more interested in reaching an accommodation with reformists in Iran than in standing by America’s traditional allies in the Arab world.

Prince Mohammed, who is a senior member of the Saudi ruling family, insists the negotiations must produce serious commitments from Iran not to produce nuclear weapons. “We hope we receive the assurances that guarantee Iran will not pursue this kind of weapon,” he said. “But if this does not happen, then all options will be on the table for Saudi Arabia.

“Iran’s nuclear programme poses a direct threat to the entire region and constitutes a major source and incentive for nuclear proliferation across the Middle East, including Israel.”

Western intelligence agencies believe that the Saudi monarchy paid for up to 60 per cent of Pakistan’s nuclear programme, in return for the ability to buy warheads for itself at short notice. Any failure by Iran to provide the necessary safeguards by the end of this month could see Riyadh activate that deal, thereby enabling Saudi Arabia to become the Arab world’s first nuclear power. And if that were to happen, then many other regional powers, such as Egypt and Turkey, would also attempt to follow suit – a nuclear arms race in the world’s most unstable region.

Prince Mohammed’s comments should serve as a warning to Mr Obama as he briefs other G7 leaders on the Iran talks at this week’s summit in Germany.

From Saudi Arabia’s perspective, though, Prince Mohammed believes Riyadh has every right to be alarmed at the prospect of Iran acquiring nuclear weapons, particularly in the light of its involvement in supporting the Houthis to overthrow Yemen’s government . “The Houthi rebels, backed by Iran, set about taking over Sanaa and then attempting to takeover Aden,” he said. “The reason air strikes became necessary was to reverse that advance and keep the road open for a political solution.

“All the evidence supports the fact that Iran is using the Houthis as warring agents for them to transform Yemen into a springboard for the delusional hegemonic designs in the Arab world.”

He played down suggestions that, equipped with its new military might, his country had its own plans for regional domination. “Saudi Arabia does not have the same ambitions for the region as others do,” he said in a reference to Iran. “All we care for is the preservation of our stability and security, and that of the Arab and Muslim worlds.”

The ambassador also expressed his concern about suggestions that Britain was playing a less prominent role in world affairs . Last week Ashton Carter, the US defence secretary, warned against what he called Britain’s “disengagement” from world affairs in the wake of the recent defence cuts.

Prince Mohammed warned that this could have negative repercussions, particularly in the Middle East. “The perception that Britain is withdrawing from the international stage could have a negative impact,” he said. “Britain has played a historical role in the region due to its colonial past. It knows the Arab world very well and it can still have a pivotal positive role. To see a country like Britain no longer playing a central role in the region will have ramifications that are not positive.”

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The Syrian businessman was enjoying a much needed holiday in Turkey when the phone call came from the tax inspector of the Islamic State.

His business partner in Raqqa had been arrested, the inspector told him, and he would not be released until his company paid the $100,000 (£65,000) it owed the "Caliphate."

"They told me that because I have a lot of money, I have to pay my share," said Ammar, who asked that his real name not be used. "They analyze your income and take a percentage."

As the Islamic State, also called ISIS or ISIL, works to establish its empire, the jihadists have become fastidious bureaucrats: imposing taxes, paying fixed salaries, and imposing trading-standards laws in a bid to create a healthy economy that will sustain the group's autocratic rule.

Yet despite brutal punishments for those who break the laws, many Syrian businessmen see ISIS as the only option when compared with the anarchy that prevails in areas controlled by other rebels, including Western-backed groups.

Ammar, who deals in cars, houses, and poultry, is largely secular and privately despises the jihadists (he refers to the ISIS-held "capital" of Raqqa as "the big prison"). 

Yet he acknowledges that he now works almost exclusively in ISIS-controlled areas, having had $150,000 worth of stock stolen by a gang in turf run by another armed faction. Likewise, when he traded in areas controlled by the Syrian government, he was detained by a pro-regime militia, which demanded a bribe of $25,000 for his release.

While ISIS charges zakat, the alms payment in Islam — essentially an income tax — to those residents who can afford it, Ammar said businesses were protected from theft and corruption.

"When I take chickens that I have bought from farmers in the rural areas to Raqqa the first thing I have to do is go to the zakat office and pay the standard 2.5%," he said. "They then give me a voucher that allows me to sell the produce in the city."

The model is being applied across ISIS territory in Syria and to such a degree that businesses are now choosing to move their industry into ISIS areas.

The owners of factories in Sheikh Najjar, an industrial estate north of Aleppo city, and now a frontline, have moved to ISIS-controlled Minbij, several residents and business owners told The Telegraph.

"You can find everything from cotton to iron and plastics being processed here," one factory owner said by phone. 

In part this is because the Syrian regime has bombed ISIS areas less frequently than those of other rebel groups. But also, all the residents agreed, it is because there is more efficiency and less corruption. 

One Syrian aid worker recounted going to the market in Minbij that sells oil collected in ISIS-controlled fields: "There are hundreds of pickup trucks filled with barrels. These barrels are labeled with different colors according to the quality of the benzene inside."

As ISIS, many of whose leaders are from Iraq and Tunisia, tries to lay down roots in Syria, local residents have been allowed to maintain public services.

Teachers may continue to work, providing they agree to instruct the new curriculum, which bans subjects such as English and science, and is heavy on Sharia. Doctors and engineers, particularly those managing the ISIS-controlled oilfields, are paid handsomely — at least double, and often several fold the salaries offered in other parts of the country.

With the zakat offices run by locals, they "know how much wealth their neighbors have," and so they can insist on the "correct" tax percentage, one Raqqa resident said.

"One of them knocks on the doors of homes and demands the payment; they give you a receipt with the ISIL stamp," he said, asking, like the others in this article, not to be named, as speaking to journalists is considered a crime by the extremists.

For all the taxation, the emerging "Caliphate" remains a place that favors the rich.

The jihadists have mostly eschewed the demand in Islamic law that the zakat be used to sustain the poor, instead using the funds to buy weapons and inflate the salaries and benefits of their own fighters.

A female resident of Minbij recounted to The Telegraph how the restaurants and shops are frequented almost exclusively by ISIS fighters, with most of the civilian population unable to afford them. 

In Raqqa, residents said money had been spent on new medical equipment that wasn't available to locals.

Ammar the businessman acknowledged that his best business was selling cars to jihadists, many of them foreigners, who are flush with cash.

Hassan, a satellite installation engineer in Raqqa who came to Turkey only last month after he was wounded in a regime airstrike said: "If you have some money, and can keep your mouth shut, living there is OK." 

For most Syrians, the price paid for this modicum of stability is repression.

The jihadists' extreme version of Sharia law imposes a culture that is inimical to that of most Syrians, whose Sunni population overwhelmingly subscribe to a moderate interpretation of Islam.

Now women cannot leave the home unaccompanied and must wear the face-covering niqab. They cannot interact with men who are not close relatives or their husbands. Men should wear pants that fall above the ankle and long beards. All animal products entering the city must be halal. Films, music, and all kinds of games are banned.

The tactics used by the jihadists to enforce their order are not dissimilar to those used by the regime: spies, detentions, and killings.

The extremists carry out spot checks, randomly entering homes, or stopping people on the street to check their phones and computers for transgressions.

If someone breaks the law, the justice system that shows no mercy.

Theft can result in lost fingers or limbs; blasphemy in death.

Hassan, the satellite-installation engineer, recalled how an acquaintance swore at a vegetable-stall owner who was selling him tomatoes at a price that he found too high. The acquaintance was immediately arrested. When during a prison interrogation he swore at the ISIS jailer and then at God he sealed his fate.

"They beheaded him in the main square," Hassan said. "They left his corpse there, with a sign saying 'Kaffir' [irreligious] on it. He was 20 years old."

And yet this autocracy remains better than the alternative, of living among the ruins of cities, such as Aleppo, destroyed by fighting on the ground and attacks from the air.

Even as the US-led coalition bombs jihadi targets (with airstrikes that are considerably more precise than those of the regime), the number of people living in their areas is said to be growing.

Population estimates vary, but aid agencies believe ISIS may have as many as 2 million subjects in Syria alone.

A resident of Al-Bab, an ISIS-held territory whose market last month was decimated by a regime barrel bomb, killing up to 50 people, said: "Civilians would rather live under monkeys than under Bashar al-Assad.

"They would choose anything than a regime that has been bombings its own people. Under ISIL we can exist, but still, we live in fear."

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Islamic State to the north and rebels to the south are closing in on Damascus

President Bashar al-Assad’s military has suffered two more crushing blows as it crumbles on both fronts in the long Syrian war - against Islamic State jihadists and other rebel groups.

Rebel groups backed by western allies like Jordan and Saudi Arabia claimed to have taken a key military base on the road south from Damascus to the Jordanian border.

Meanwhile, Islamic State of Iraq and the Levant, attacked west from Palmyra, reached the town of Hassia on the main road north from Damascus to Homs and the coast.

They were also said to be taking up positions west of the road close to the Lebanese border, raising the possibility that the country could literally be split in two.

That would not only be a disaster for the regime but would raise the threat of Lebanon being sucked further into the conflict.

The area near the border is regarded as a vital strategic interest for Hizbollah, the Lebanese Shia militia that has been helping the regime fight the rebels.

It is already fighting a three-way battle in the border area, including inside Lebanon itself.

The Assad regime has suffered a series of blows in recent weeks that have once again raised questions about how long Iran will continue to support it.

Since it took Palmyra three weeks ago, Isil has pushed on against a regime defence line that is withering.

It is now close to Homs, the capital of Syria’s largest province but more important as a symbol of the early, non-jihadist opposition to the Assad regime.

The defeat of a coalition of secular and “moderate” Islamist forces in Homs after a long siege by the regime was for a while seen as a turning point in the war.

In fact, it seems merely to have invigorated support for more militant varieties of rebel.

“Isil controls some of Hassia,” said Khodair Khashafa, a media activist from Homs. Hassia is a small town that sits astride the M5 highway that connects Damascus not just to Homs but all the northern cities, including the Alawite areas of the coast that form the heartland of the regime.

South of Damascus, the rebel movement remains dominated by non-Isil groups. Some are in alliance with Jabhat al-Nusra, the Syrian branch of al-Qaeda, but the dominant fighting forces are backed by Saudi Arabia and supplied through Jordan.

They have managed to wrest large parts of Dera’a province away from the regime. Yesterday, they took Brigade 52 Headquarters, a large military base near Dera’a city three miles east of the main road from Damascus to the border, along with surrounding villages.

Essam al-Rayes, an army defector who is main spokesman for the Southern Revolutionary Front, said a “swift strike” by 2,000 rebels had seized the base.

More than 70 regime soldiers were killed, while the hospital in the nearby regime-held city of Suweida was said to be flooded with the injured, who included some Iranian “advisers”.

In the face of recent losses, which include the major cities of Idlib and Jisr al-Shugour in the north-west which had previously held out against rebel assault for almost four years, the regime has been on an aggressive recruitment drive.

However, it has had to resort to “golden handshakes” to try to entice more men into volunteering, as recruitment parties find resistance even in the regime’s Alawite heartlands.

Iran is also now paying members of its Shia sect as far afield as Pakistan and Afghanistan to join up to fight for the regime.

Western diplomats are increasingly hopeful that Iran will sooner or later realise that the cost of supporting Mr Assad is too high, and agree to a compromise under which he is replaced by a figure acceptable to both the remnants of the regime and at least some “moderate” rebels.

President Hassan Rouhani of Iran last week promised it would continue to support Syria. However, his words stressed that it was the government it was backing, not the man at its helm.

"The Iranian nation and government will remain at the side of the Syrian nation and government until the end of the road," he said, in words quoted by Iranian news agencies.

Would-be jihadists are using new routes through countries as far away as Canada to join Isil, Foreign Secretary Philip Hammond has said as he admitted authorities were "struggling" to stop British radicals heading east.

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A year on since it it staked its black flag over a vast chunk of Iraq, Isil is busier than ever.

The group has made impressive military gains recently, foremost in its capture of Ramadi, the capital of Iraq's Anbar Province, and the seizure of the central Syrian city of Palmyra, both of which were taken within a week of each other.

At the time of writing, Islamic State of Iraq and the Levant is continuing to expand westwards towards Damascus in the south, while at the same time encroaching ever more on the northern city of Aleppo.

Internationally, too, it has been rearing its ugly head, with multiple high-impact, high-profile suicide bombings hitting the Arabian Peninsula in the past fortnight.

The “Isil in decline” narrative that has pervaded the media in recent months has been systematically decimated by such events. For a while now, optimistic officials from anti-Isil coalition member states have waxed lyrical about the progress made against the group: key players, they say, have been killed, weapons stores obliterated and strategically critical territories lost.

This narrative is mistaken and, in all likelihood, it will only continue to look more so in the coming weeks, as Isil up-scales its videographed violence, continues current offensives, and carries out more terrorist attacks abroad.

Lest we forget, the Isil caliphate was declared on the first day of Ramadan last year . Now, with Ramadan just weeks away, we can be confident that the group will mark the occasion of its first anniversary. Even after its anniversary passes, its activity is not likely to abate – after all, as the group’s leader Abu Bakr al-Baghdadi noted last year, “there is no deed in this virtuous month” better than jihad.

The motivations for Isil expanding its global agitation operations and redoubling efforts in its regional offensives are simple to identify. Beyond theology, the automatic result of such activity – publicity and outrage – is instrumental to Isil’s very ability to survive. Now, more than ever, it needs to appear active, dangerous and triumphant – the perception of its ever-growing momentum is of existential value to the group and something that it is desperate to sustain.

Make no mistake, everything we are seeing now and will be witness to in the coming weeks, has been meticulously planned, probably months ago. The new offensives, pledges of allegiance, propaganda: all of these disparate strands of Isil’s growth and consolidation strategy will be drawn together in the short-term future, as its leadership works to magnify its global menace.

Besides the release of a barrage of Isil snuff films – which, safe to say, will be typically abhorrent and likely feature a mass execution in the ancient ruins of Palmyra – there will likely be tangible changes to the strategic playing field as Isil stretches itself further.

The world’s media must prepare itself for this and react accordingly, in a manner that does not play into the organisation’s hands. The media is obligated to report on its crimes, but it must do so in a manner that Isil supporters do not revel in.

All too often, coverage of Isil has turned into an extension of the propaganda itself: using clips or screengrabs from Isil videos only serves to broaden the audience for its industry of fear and supplement the jihobbyist echo chamber that sustains its.

Instead of acting as a mode of transmission, global media should fulfil its potential and recognise that its role, easily as important as any military initiative, is most crucial in countering Isil. Who, after all, is better-placed to debunk Isil’s utopia myth by projecting the voice of those with first-hand experience of its lies, the people who have fled it?

The more ground taken, the more anger provoked and blood spilled, the stronger Isil looks. As long as it is perceived from the outside to be something undefeatable, it can make the claim that God is on its side and continue to draw in its most valuable commodities – fear and human capital.

Hence, in the coming weeks, it is more important than ever than its propagandists are stopped from steering the media discourse. The caliphate brand is strong, but it is not indestructible. Yes, Isil is not in decline – but nor is it invincible. Now is the time to exploit its already extant cracks.

If ever Isil actually looks in decline – that is, real decline – then the coalition’s job of degrading and destroying it would be eminently achievable. The more Isil struggles, the simpler it is to draw attention to the glaring falsehoods in its theological, political and military narrative and, hence, the lesser its ability to muster together new recruits.

Isil does not just crave attention, it needs it to survive.

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They initially shadowed a surveillance aircraft, before checking out a transport plane flying over the Baltic Sea

RAF Typhoons have intercepted and shadowed two Russian military aircraft over the Baltic Sea, it has been disclosed.

The jets were scrambled from Amari Air base in Estonia yesterday after the planes approached Baltic airspace without sharing a flight plan.

They initially identified and shadowed an Il-20M "Coot" A surveillance aircraft, before checking out a an An-26 "Curl" transport plane flying north from Kaliningrad.

Four Typhoons were deployed to Amari on May 1, and are working with Norwegian aircraft to patrol Latvia, Estonia and Lithuania.

Defence Secretary Michael Fallon, who plans to visit the Baltic Air Policing detachment later this month, said: "The interception of Russian military aircraft by our RAF Typhoon fighters underlines our commitment to Nato and the security of the Baltic region.

"RAF air and ground crew are doing vital work to defend the skies above and around the Baltic States and I look forward to seeing that work first hand in the near future. "

Flight Lieutenant Paul Griffin said: "In this case the Typhoons were given the nod and the Estonian controllers hit the scramble button.

"The Estonian controllers picked up the aircraft on their radar picture and evaluated whether it had a flight plan and its heading, height and speed. Once it was clear it was an unknown they gave it an appropriate identification colour which made it stand out on our radar scopes."

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Inditex, the Spanish owner of Zara and largest clothing retailer in the world, said profits in the first-quarter jumped 28% higher after it opened more stores and benefitted from the weak euro.

Sales moved to $4.97 billion during the three months to the end of April, some 17% higher than the same period last year.

Net income of $5.89 million during the first quarter was 28% higher than the prior year period. The company signalled that revenue growth in the second quarter has accelerated slightly so far.

Inditex, which also owns Pull&Bear, Bershka, and Massimo Dutti, opened 63 new stores during the first quarter to bring the total to 6,746 at the end of April, up from 6,393 at the same stage last year.

Store and online sales increased by 13.5% between February 1 and June 7. Zara is planning expansion in Asia with online sales available in Taiwan, Hong Kong and Macau this year.

The company is known for its “fast fashion” whereby stores receive deliveries twice a week and products designed at the headquarters in Artexio, Northern Spain, can be in shops three weeks later.

The clothing retailer has opened about 400 stores every year during the past five years and operates in 88 countries.

Shares in Inditex were down $.07 to $33.86 per share on the Spanish stock exchange in early trading.

Irish stock broker Davy said the better than expected profit performance and strong sales at Inditex was a positive for Primark owner Associated British Foods.

Inditex shares have gained 26% this year and this has increased 79-year-old founder Amancio Ortega’s fortune to $71 billion. Mr. Ortega is now the second richest man in the world behind only Bill Gates, and richer Warren Buffett, according to the Bloomberg Billionaires Index.

Inditex benefited as the euro weakened against the US Dollar, Japanese Yen and the Chinese Yuan, meaning that sales in these regions were worth more when translated back into euros for reporting purposes. Inditex has more than 500 stores in China and 450 in Russia.

Inditex’s gross profit margin increased from 58.9% to 59.4%. The company forecast a stable margin for the full year to March.

This article was written by John Ficenec from The Daily Telegraph and was legally licensed through the NewsCred publisher network.

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The global deflation trade is unwinding with a vengeance. Yields on 10-year Bunds blew through 1pc today, spearheading a violent repricing of credit across the world.

The scale is starting to match the 'taper tantrum' of mid-2013 when the US Federal Reserve issued its first gentle warning that quantitative easing would not last forever, and that the long-feared inflexion point was nearing in the international monetary cycle.

Paper losses over the last three months have reached $1.2 trillion. Yields have jumped by 175 basis points in Indonesia, 160 in South Africa, 150 in Turkey, 130 in Mexico, and 80 in Australia.

The epicentre is in the eurozone as the "QE" bet goes horribly wrong. Bund yields hit 1.05pc this morning before falling back in wild trading, up 100 basis points since March. French, Italian, and Spanish yields have moved in lockstep.

A parallel drama is unfolding in America where the Pimco Total Return Fund has just revealed that it slashed its holdings of US debt to 8.5pc of total assets in May, from 23.4pc a month earlier. This sort of move in the staid fixed income markets is exceedingly rare.

The 10-year US Treasury yield - still the global benchmark price of money - has jumped 48 points to 2.47pc in eight trading sessions. "It is capitulation out there, and a lot of pain," said Marc Ostwald from ADM.

The bond crash has been an accident waiting to happen for months. Money supply aggregates have been surging all this year in Europe and the US, setting a trap for a small army of hedge funds and 'prop desks' trying to squeeze a few last drops out of a spent deflation trade. "We we're too dogmatic," confessed one bond trader at RBS.

Data collected by Gabriel Stein at Oxford Economics shows that 'narrow' M1 money in the eurozone has been growing at a rate of 16.2pc (annualized) over the last six months. You do not have to be monetarist expert to see the glaring anomaly.

Broader M3 money has been rising at an 8.4pc rate on the same measure, a pace not seen since 2008.

Economic historians will one day ask how it was possible for €2 trillion of eurozone bonds - a third of the government bond market - to have been trading at negative yields in the early spring of 2015 even as the reflation hammer was already coming down with crushing force.

"It was the greater fool theory. They always thought there would be some other sucker to buy at an even higher price. Now we are returning to sanity," said Mr Stein.

M3 growth in the US has been running at an 8pc rate this year, roughly in line with post-war averages. The growth scare earlier this year has subsided, as was to be expected from the monetary data.

The economy has weathered the strong dollar shock and seems to have shaken off a four-month mystery malaise. It created 280,000 jobs in May. Bank of America's GDP 'tracker' is running at a 2.9pc rate this quarter.

Capital Economics calculates that hourly earnings have bee rising at a rate of 2.9pc over the last three months, the fastest since the six-year expansion began.

Bond vigilantes - supposed to have a sixth sense for incipient inflation, their nemesis - strangely missed this money surge on both sides of the Atlantic. Yet M1 is typically a six-month leading indicator for the economy, and M3 leads by a year or so. The monetary mechanisms may be damaged but it would be courting fate to assume that they have broken down altogether.

Jefferies is pencilling in a headline rate of 3pc by the fourth quarter as higher oil prices feed through. if they are right, we will be facing a radically different economic landscape within six months.

This has plainly been a bond market bubble, one that is unwinding with particular ferocity because new regulations have driven market-makers out of the business and caused liquidity to evaporate. Laurent Crosnier from Amundi puts it pithily: "rather than yield at no risk, bonds have been offering risk at no yield."

Funds thought they were on to a one-way bet as the European Central Bank launched quantitative easing, buying €60bn of eurozone bonds each month at a time when fiscal retrenchment was causing fresh supply to dry up. They expected Bunds to vanish from the market altogether as Berlin increases its budget surplus to €18bn this year and retires debt.

Instead they have discovered that the reflationary lift from QE overwhelms the 'scarcity effect' on bonds. Contrary to mythology - and a lot of muddled statements by central bankers who ought to know better - QE does not achieve its results by driving down yields, at least not if conducted properly and if assets are purchased from outside the banking system. It works through money creation. This in turn lifts yields.

The ECB's Mario Draghi has achieved his objective. He has (for now) defeated deflation in Europe. After six years of fiscal overkill, monetary contraction, and an economic depression, the region is coming back to life.

How this now unfolds for the world as a whole depends on the pace of tightening by the Fed. Futures contracts are still not pricing in a full rate rise in September. They are strangely disregarding the message from the Fed's own voting committee - the so-called 'dots' - that further rises will follow relatively soon and hard.

The Fed is implicitly forecasting rates of 1.875pc by the end of next year. Markets are betting on 1.25pc, brazenly defying the rate-setters in a strange game of chicken.

The International Monetary Fund warned in April that this mispricing is dangerous, fearing a "cascade of disruptive adjustments" once the Fed actually pulls the trigger.

Nobody knows what will happen when the spigot of cheap dollar liquidity is actually turned off. Dollar debts outside US jurisdiction have ballooned from $2 trillion to $9 trillion in fifteen years, leaving the world more dollarised and more vulnerable to Fed action than at any time since the fixed exchange system of the Gold Standard.

Total debt has risen by 30 percentage points to a record 275pc of GDP in the developed world since the Lehman crisis, and by 35 points to a record 180pc in emerging markets.

The pathologies of "secular stagnation" are still with us. China is still flooding the world with excess manufacturing capacity. The global savings rate is still at an all-time high of 26pc of GDP, implying more of the same savings glut and the same debilitating lack of demand that lies behind the Long Slump.

As Stephen King from HSBC wrote in a poignant report - "The World Economy's Titanic Problem"- we have used up almost all our fiscal and monetary ammunition, and may face the next global economic downturn with no lifeboats whenever it comes.

The US is perhaps strong enough to withstand the rigours of monetary tightening. It is less clear whether others are so resilient. The risk is that rising borrowing costs in the US will set off a worldwide margin call on dollar debtors - or a "super taper tantrum" as the IMF calls it - that short-circuits the fragile global recovery and ultimately ricochets back into the US itself. In the end it could tip us all back into deflation.

"We at the Fed take the potential international implications of our policies seriously," said Bill Dudley, head of the New York Fed.

Yet in the same speech to a Bloomberg forum six weeks ago he also let slip that interest rates should naturally be 3.5pc once inflation returns to 2pc, a thought worth pondering.

Furthermore, he hinted that Fed may opt for the fast tightening cycle of the mid-1990s , an episode that caught markets badly off guard and led to the East Asia crisis and Russia's default.

The bond ructions this week are an early warning that it will not be easy to wean the world off six years of zero rates across the G10, and off dollar largesse on a scale never seen before. Central banks have no safe margin for error.

This article was written by Ambrose Evans-Pritchard from The Daily Telegraph and was legally licensed through the NewsCred publisher network.

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Erkki Liikanen enjoys a challenge.

At 64, the governor of Finland's central bank has faced a few in his lifetime. First, as finance minister in the years before the collapse of the Soviet Union, one of Finland's key export markets, and in his current job, where he has seen the economy go from leader to laggard in a decade.

Finland is in trouble, and in the words of the central bank this week, the situation is "grave" .

While France has often been branded Europe's "sick man" and Greece's problems are well known, Finland's economy is still 5pc smaller than before the financial crisis. The country will barely crawl out of a three-year recession this year, while unemployment is forecast by the OECD to grow in 2015.

Faced with a bloated state, below-par growth, and prices and costs that have risen at a much faster pace than the rest of the eurozone, the medicine is a familiar one.

"The key to resolving the serious problems in the economy lies in structural reforms, fiscal consolidation and improved cost competitiveness," the Bank of Finland's latest health check of the economy said last week.

The phrase could have been taken from Greece's own long austerity prescription, but with an ageing population, state spending approaching 60pc of gross domestic product (GDP) and tax revenues far short of this, something has to change, and quickly.

Perhaps Liikanen's passion for marathon running will be a help because, like so many others in Finland, he knows he is in it for the long haul. "I ran 4 hours 35 minutes in December," he states, an impressive time, particularly for a sexagenarian.

Finland, which has become known as one of the eurozone's lead preachers of fiscal prudence, will embark on a €10bn (£7.2bn) round of belt tightening over five years .

Following April's elections, Juha Sipila, the prime minister, Timo Soini, the eurosceptic foreign minister and Alexander Stubb, the finance minister, have pledged to create more jobs, to get the economy moving and avoid a "lost decade" from a lack of reforms.

Liikanen is less gloomy. He says many of Finland's woes stem from "four shocks" that hit at the same time: the decline of Nokia and the country's paper industry, the retirement of a generation of baby boomers, high labour costs, which have made the economy uncompetitive, and the fallout from the Russian crisis.

Bank of Finland data show that in the five years following the 2008 financial crisis, the manufacturing industry suffered job losses of 42,000, while the electrical engineering sector has seen losses of 53,000 – significant in a country with a population of just five million.

With the eurozone also facing questions about its future, moving on from the Nokia era requires stamina, grit, resilience, and stoicism. Britons aren't the only ones with a stiff upper lip. In Finland it's called "sisu".

"Sisu means that you never give in – you never give up, you go to the very end," says Liikanen. "You keep moving. I'm a marathon runner, you don't need a lot of talent, but you need character to finish."

But would Finland need "sisu" if it didn't have the euro? Soini has admitted that he is "not committed" to the single currency, while the country's crisis in the 1990s was helped by a massive devaluation, which cannot be repeated now that Finland belongs to the 19-nation club.

Liikanen, a policymaker for 25 years, is not convinced that returning to the markka would help.

"If we had a little weaker Finnish markka, I don't believe that Nokia would beat iPhones or that young people would suddenly start to read printed books and newspapers and create demand for the products of Finnish paper mills.

"Our challenges are based on structural facts, an adjustment of our currency would not make up for those challenges."

For Liikanen, the government must focus on three areas to strengthen the economy. "[We must] consolidate the public finances. Our GDP is smaller but our welfare state has not shrank so much. I think the programme is going in the right direction. Structural reform is needed to increase competition in our product and labour markets. In addition, our pension reform has been negotiated but it hasn’t been legislated.

"If we increase competition we can get our service costs down. Conditions for housing supply also need to be improved. We know that rents have been rising in Finland more than in most other euro area economies in the last ten years – Austria is the other one. And this has happened in a country where there is more land per person than anywhere else in Europe."

While Liikanen is loyal to the Nokia brand, a fact revealed in the middle of the interview when the sound of the company's famous ringtone blasts out from his pocket, he's also hopeful for the future. He is pinning his hopes on the tech start-ups that launched hit games such as Angry Birds and Clash of Clans, and wants Finnish policymakers to help the Supercells and Rovios of this world to flourish.

"We've had a tough period, but have we lost our innovative capacity? The answer is no. There are a pretty impressive amount of start-ups now which are combining the old industrial knowledge with modern IT skills. These companies may not employ many people yet but many are profitable and act as important drivers of innovation."

While demographics are not on Finland's side, its highly trained workforce is. Nordic countries have continued to lead the way in eliminating gender equality, which has also meant Finland has one of the highest female employment rates in Europe, with most in full-time jobs.

Finland's employment gender gap in 2012 was the second smallest in the EU after Latvia, according to the European Commission, while it also topped the World Economic Forum's education, skills and employment league table, which looks at how well countries nurture and develop its people.

Liikanen, a member of the European Central Bank's governing council, has a few stern words for Greece as it continues to negotiate a fresh rescue package, saying the ball is firmly in the country's court. "Countries that have supported Greece have taken a risk towards their own taxpayers. Most people want to have a solution, not only words, which are a bridge to nowhere."

But Liikanen is also optimistic about the future of the eurozone. "We have had a difficult period. I, however, have reasons for pragmatic optimism.

"Since 2012, we were able to complete the banking union, we have … a resolution system. I have been in European policymaking for 25 years, and this is the biggest step since the 1990s. Capital markets union is also very important. If you have a banking union and a capital markets union, and they function, then a big part of risk sharing is taken care of by the financial markets.

However, he says there is much less appetite for full fiscal union.

“There are many historical differences. We have our national traditions, our cultures, out languages, that was created from scratch, we have our histories. In the areas where it makes sense – like banking union, capital markets union.

"We can go deeper [but] I do not think that we will have a big European budget with which we will do all the rebalancing like in America.”

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Germany has disclosed that it is making contingency plans for Greece to leave the euro as "make or break talks" are expected to end without agreement today.

Wolfgang Schaeuble, Germany's finance minister, said he was not hopeful that Greece and its creditors would reach agreement on the release of new bail-out funds.

With Greece set to default on a €1.5billion (£1.1billion) debt repayment, Mr Schaeuble said that Angela Merkel's government was making emergency plans for the country's exit from the eurozone.

The Left-wing Syriza government, led by Alexis Tsipras, yesterday confirmed that Greece would run out of money by the end of the month unless its creditors agreed to release €7.2billion (£5.1billion) in bail-out funds.

Senior German politicians last night accused MrTsipras's government of not having grasped the seriousness of the situation, describing Greek politicians as "clowns".

Downing Street also disclosed yesterday that ministers were "stepping up" plans for "Grexit".

George Osborne, the Chancellor, has been chairing a meeting of ministers this week amid fears that British holidaymakers will be stranded abroad if Greece defaults on its debt repayment.

The Treasury is making contingency plans to deal with "serious economic risks" to Britain should Greek leave the eurozone, Downing Street said.

The British Chambers of Commerce warned that market upheavals caused by "a messy Grexit" could hit UK businesses and called on central banks and governments to take action to limit disruption "through all means possible".

John Longworth, the director general of the BCC, said: "With a messy Grexit looking increasingly likely, many UK businesses may be hit by the resulting market upheaval, changes in trade flows, and payment issues."

The comments came as Greece's central bank warned for the first time that the country could be on a "painful course" to debt default and exit from both the eurozone and the European Union.

Yannis Stournaras, the bank's governor, said that a failure to reach a deal would "mark the beginning of a painful course that would lead initially to a Greek default and ultimately to the country's exit from the euro area and — most likely — from the European Union".

There are growing concerns that Greece will not be able to continue paying out its salary and pensions bill, while servicing its international loans.

Greece is due to make its half-monthly wage instalment later this week. This will be followed by a €1.6billion loan repayment to the IMF on June 30 — the same day the debtor's bail-out programme officially expires.

Eurozone finance ministers are due to meet today in what had been seen as key summit to resolve the Greek crisis.

However, officials said any chance of a breakthrough was now slim because nei-ther side was prepared to bring forward new proposals that could end the crisis.

It means that next week's EU summit of leaders is poised to be one of the most historic in the near-60 year history of the European Commission, as talks about Greece and David Cameron's British renegotiation look likely to dominate proceedings.

Hopes of a deal have faded in recent days after increasingly combative comments by Mr Tsipras.

He has accused Greece's creditors of attempting to "pillage" and "humiliate" the country.

Andreas Scheuer, an ally of Mrs Merkel and secretary-general of her CSU party, said: "The Greek government apparently hasn't realised the seriousness of the situation yet.

"They are behaving like clowns sitting in the back of the classroom, although they have received explicit warnings from all sides that they might fail to pass to the next grade."

Mr Cameron yesterday continued his diplomatic efforts over Britain's renegotiation with the EU during talks with Matteo Renzi, the Italian prime minister.

Mr Renzi is considered a close ally of Mr Cameron and told the Prime Minister that the idea of the EU without Britain as a member was "impossible".

He promised to work with "determination" to help Mr Cameron gain the reforms needed to keep Britain in the EU.

Greece: What happens next

Today Crunch talks in Luxembourg at the meeting of eurozone finance ministers. If no deal is struck, a new critical phase will be triggered.

Friday June 19 Day two of the Luxembourg talks, with all 28 EU states represented. The clock will be ticking with Greece needing to make a €1.5bn repayment to the IMF by the end of June. No deal by the end of the day would turn a crisis into an emergency.

Sunday June 21 A date touted for an emergency meeting of the government heads of the 19 common currency members. There is hope that if ministers cannot solve the impasse Alexis Tsipras, the Greek prime minister, could do so.

Monday June 22 If markets open without a deal despite three days of negotiations, things could turn ugly. Capital controls could be put in place to stop a run on the banks and prevent financial meltdown.

Thursday June 25 The date of the EU summit. David Cameron hopes to push his renegotiation but may have to shelve plans if the Greek crisis remains unresolved.

Tuesday June 30 Greece's bail-out expires and €1.5bn in loan repayments is due. Without reforms, chances of extending it are next to nil.

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A newly discovered collection of stars will now bear the nickname of the Real Madrid and Portugal striker

If you thought Cristiano Ronaldo couldn't get any bigger - think again. The Ballon D'Or winner has gone from mere football star, to an entire galaxy.

Astronomers have dubbed a newly discovered galaxy Cosmos Redshift 7 - or CR7 for short. CR7 has long been Cristiano Ronaldo's copyrighted nickname, adourning the former Manchester United player's long line of products, including boots and men's underwear.

The group who first sighted the collection of stars are led by David Sobral from the University of Lisbon. Sobral claims to be a keen football fan and wanted to honour Cristiano Ronaldo by naming the discovery after him.

In a statement released by the European Southern Observatory, the team admitted the idea to name the galaxy CR7 was 'inspired by Cristiano Ronaldo'.

"It's an exceptionally rare object - by far the hottest we've observed at this stage of the universe", the astronomers did not clarify whether they were referring to Ronaldo or the galaxy...

This article was written by Callum Davis from The Daily Telegraph and was legally licensed through the NewsCred publisher network.

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Pepper, a robot capable of detecting human emotions, sold out in under a minute at the weekend, as Japanese consumers raced to be one of the first to own the "robot with a heart".

Softbank, which developed the humanoid machine and announced it last year, said it had sold the first batch of 1,000 robots online in the first 60 seconds they were on sale.

Pepper, which costs 198,000 yen (around $1,583) plus monthly service and insurance fees, is capable of recognising feelings such as anger, joy and sadness. Including the other fees, the cost of owning one is around 1.2m yen ($9,498) over three years.

It then reacts accordingly, providing companionship for those who do not have it, or are simply curious about the latest robotic developments.

The robot has been designed to help address Japan's rapidly ageing population. The median age in the country is 46 - one of the world's highest - and its birth rate has slumped to a record low.

“Our vision is to offer a robot with love,” Softbank chief executive Masayoshi Son said at a press conference last week.

Pepper, which is four foot high, and weighs around four-and-a-half stone, can dance to music, bow in respect and move its arms in a convincing interpretation of human movement.

Softbank, which plans to release Pepper in other countries later this year, will put 1,000 units a month on sale. It has big plans for the robot, but says it will not make a profit on it for years.

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With their neat uniforms, punctual schedules and plastic flowers pinned to their caps, they are the lesser-known face of Japan’s iconic bullet trains: the cleaners.

A new short film, viewed nearly 3 million times online, has cast the spotlight on the diligent behind-the-scenes cleaners who transform the carriages of the nation’s “shinkansen” bullet trains between journeys.

The film, entitled “7-Minute Miracle”, reveals a glimpse into the meticulous cleaning rituals of teams of workers who clean the entire length of a bullet train within seven minutes.

High-speed images depict workers bowing as the train pulls in, before sweeping, wiping, picking up rubbish and aligning all the seats in the right direction using a secret button, as they make their way through the carriages.

The footage is accompanied by the English subtitles: “323 shinkansen bullet trains depart Tokyo Station daily, transporting nearly 400,000 passengers every day. And the Tessie cleaning crew has just seven minutes to ready the train to ride.”

The film was created by Charli James, a New York based journalist and filmmaker, who shot the footage of the behind-the-scenes train cleaning teams from the company Tessei during a stay in the Japanese capital last autumn.

Her visit was masterminded by Dateline Tokyo, an initiative created by Tokyo Metropolitan Government to promote Tokyo and its culture of Japanese hospitality – known as “omotenashi” - in the run up to the 2020 Olympics .

Inspired by a train trip from Tokyo to Kyoto, Ms James was keen to highlight how “Japanese people take such pride in their work, and strive to make everything best,” according to the Japan Times.

Here is the full video:

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It is being described as the worst cyber hack of the US government in history – a huge personnel database of government employees pilfered by foreign spies. But yesterday it emerged that the vast trove of details stolen is likely to have included information people supplied to get security clearances – such as intimate details of their sex lives, drug use and finances.

All of this, it is feared, is now in the hands of a foreign power, which could use it to blackmail and extort officials and, ultimately, get hold of classified information.

The finger has been pointed at China (which has denied any role). But it is little wonder that cyber-spying was top of the agenda when President Obama sat down with Chinese officials in Washington this week. “We remain deeply concerned about Chinese government-sponsored cyber-enabled theft,” the US Treasury Secretary said of the wider problem. But it is not just America that has been hit.

The first detected breach of British government systems came in 2003, when an email purportedly from a Tibetan group was opened in the Foreign Office.

Hidden in a picture was a virus which allowed the hackers to get inside the network. In the following years, evidence that Britain was the target of a growing cyber espionage campaign increased.

It also became clear that not just government, but also businesses were being targeted for their valuable secrets.

In 2012, the then-head of MI5, Jonathan Evans, issued a warning about the scale of cyber espionage . In a speech he said that a “major London listed company” had lost a staggering £800m as a result of a “hostile state cyber attack”. It was a statement designed to shock – and it received extensive media coverage. But the victim was not identified. For the first time, the name of the company being referred to can now be revealed. A number of sources say that it was the mining giant Rio Tinto .

The company itself will not comment but the extractive industries have been a major target for Chinese spies as China has a vast appetite for raw materials to fuel its growth – including iron ore for the steel to build its skyscrapers, cars and for use in its factories. In 2009, Rio Tinto was engaged in negotiations which involved fixing iron ore prices with China over long periods for vast sums of money.

Renegotiation of these contracts was a game played for high stakes, notably as gaps opened up between the market price and the price that had been fixed. Rio Tinto staff were even arrested . China may have achieved its goal of lowering prices through a mixture of traditional means – such as pressuring staff – alongside cyber espionage at the crucial moment in order to ensure a “negotiated” shift to a pricing deal much more favourable to Beijing (although the final losses to Rio Tinto, experts say, may not quite have been as high as first estimated).

“There are now three certainties in life,” MI5’s then-head of cyber told me in 2013. “There is death. There are taxes. And there is a foreign intelligence system on your system.” despite this, companies are unwilling to discuss what has happened, partly out of embarrassment but also because they often still need to do business in China.

And it is not just the Chinese. In terms of volume of attacks on Western companies, they may be the largest player on the field but, as I was researching my book on computers and espionage, I found that one other country worried officials just as much.

The Chinese use big nets to trawl but are often sloppier and easier to spot. Russia’s hackers, by contrast, are more expert and operate below the radar.

Increasingly cyber espionage is combined with human espionage to research targets and work out whom to approach and how. One Russian espionage attack is said to have involved researching a business executive, leading to the conclusion that he was gay but not out of the closet. The hackers then sent him an email from a gay rights organisation which they suspected he would open since it looked as if it was sent personally to him. In fact it contained malicious computer code or malware. They then counted on the fact that, even if the executive did suspect it was malware, he would not be willing to go to his company’s IT department or security team for fear it would reveal his sexuality.

The Russian economy is heavily dependent on exporting energy, and the country’s intelligence services also appear to have prioritised this field. One major energy firm was told by the British government that it had something on its system.

Within a day, the company found that one computer was sending out a signal after a small number of individuals had been sent carefully researched emails. Forensics on the machine showed the malware had been in place for nine months. The company analysed the email, the target and the timing (correlating it with business transactions going on at the time). That left them 99 per cent sure that it was a state-sponsored attack by the Russians on behalf of their energy industry.

Russian spies are doing what they always did. The difference now is that they doing it in cyberspace. And of course, it would be naive to think that Britain is not carrying out cyber-espionage.

It, like the US, started spying over the internet as far back as the early 1990s.

British and American officials claim though that they do not carry out the kind of corporate espionage that others undertake (in which foreign companies are spied on to help their own companies). But they will spy on trade talks to support national economic “well-being” so the distinction is a subtle one that critics contest).

The White House had planned to confront China over cyber-espionage at a previous summit in 2013. “We were spring-loaded,” one former US intelligence chief said of that moment.

But hours before the summit opened, a top secret document was published which outlined America’s own offensive cyber operations. long with other material that was then emerging thanks to Edward Snowden, this changed the terms of debate and led people to ask who was really the most aggressive player in cyberspace. The plan to pressure Beijing fizzled out. Since then, however, the US has tried to increase the pressure. Britain has been less vocal.

The Snowden documents revealed the scale of the intelligence gathering machine that Britain and America have built to monitor the global flow of data. But what is rarely understood is that the same system of “bulk intercept” that is criticised for being “mass surveillance” is not just looking for people but also used to look for signs of cyber attack. This is done by looking for signatures of particular attacks and what kinds of stolen information are being moved around over the internet.

This gives the intelligence agencies a unique insight into what is happening but has also raised questions as to how far they go in informing and working with companies and the general public if they spot something bad happening to them. In the new world of cyber threats, spies may have to come out of their shadows a little more if they are still to protect us.

Intercept: The Secret History of Computers and Spiesby Gordon Corera is published by Weidenfeld & Nicolson this week.

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When Hessy Taft was six months old, she was a poster child for the Nazis. Her photograph was chosen as the image of the ideal Aryan baby, and distributed in party propaganda. But what the Nazis didn’t know was that their perfect baby was really Jewish.

“I can laugh about it now,” the 80-year-old Professor Taft told Germany’s Bild newspaper in an interview. “But if the Nazis had known who I really was, I wouldn’t be alive.”

Prof Taft recently presented the Yad Vashem Holocaust Memorial in Israel with a Nazi magazine featuring her baby photograph on the front cover, and told the story of how she became an unlikely poster child for the Third Reich.

Her parents, Jacob and Pauline Levinsons, both talented singers, moved to Berlin from Latvia to pursue careers in classical music in 1928, only to find themselves caught up in the Nazis’ rise to power.

Her father lost his job at an opera company because he was Jewish, and had to find work as a door-to-door salesman.

In 1935, with the city rife with anti-semitic attacks, Pauline Levinsons took her six-month-old daughter Hessy to a well-known Berlin photographer to have her baby photograph taken.

A few months later, she was horrified to find her daughter’s picture on the front cover of Sonne ins Hause, a major Nazi family magazine.

Terrified the family would be exposed as Jews, she rushed to the photographer, Hans Ballin. He told her he knew the family was Jewish, and had deliberately submitted the photograph to a contest to find the most beautiful Aryan baby.

“I wanted to make the Nazis ridiculous,” the photographer told her.

He succeeded: the picture won the contest, and was believed to have been chosen personally by the Nazi propaganda minister Joseph Goebbels.

Frightened she would be recognised on the streets and questions asked about her identity, Prof Taft’s parents kept her at home.

Her photograph appeared on widely available Nazi postcards, where she was recognised by an aunt in distant Memel, now part of Lithuania. But the Nazis never discovered Prof Taft’s true identity.

In 1938, her father was arrested by the Gestapo on a trumped up tax charge, but released when his accountant, a Nazi party member, came to his defence.

After that, the family fled Germany. They moved first to Latvia, before settling in Paris only for the city to fall to the Nazis.

With the help of the French resistance, they escaped again, this time to Cuba, and in 1949 the family moved to the United States.

Today the Jewish woman who was once a Nazi poster child is a professor of chemistry in New York.

“I feel a little revenge,” she said of presenting her photograph to Yad Vashem. “Something like satisfaction.”

Here is a video interview with her:

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Jonathan Forster, who runs Spotify's European operations, said he is not concerned about Apple Music but would like to see artists treat Spotify "fairly and consistently"

A senior executive at Spotify has welcomed the announcement of Apple Music, denying that the world’s most valuable company’s move into streaming will threaten the Swedish startup’s position.

Speaking to the Telegraph in Stockholm earlier this month, Jonathan Forster, who runs Spotify’s European operations, said the launch of Apple Music “validates" Spotify's business model.

"The company that was dominating the other way now saying we were right is a good feeling.”

The iPhone maker recently unveiled the new streaming and radio service, which will be available from Tuesday for $9.99 a month following a three-month free trial, at its annual developers conference in San Francisco in a widely-expected move after buying Beats for $3bn last year .

Apple Music could be seen as an about-turn for the technology giant that was instrumental in shaping the digital music market, with the release of the iTunes store in 2003 enabling users to purchase and download songs.

Spotify launched five years later, pioneering the “freemium” model that allows users to stream music for free or upgrade to an ads-free premium service for a monthly fee.

Spotify co-founder and CEO Daniel Ek was seen to shrug off the threat of Apple Music after its announcement, posting and then deleting a tweet that simply read, “Oh ok.”

But “that’s just how he talks”, according to Mr Forster, who moved from the UK to Stockholm around a decade ago and was one of Spotify’s first dozen staff, joining the company before its product launched.

“ Apple Music changes the conversation – it has to,” he said. “But being big does not mean that you win.”

He echoed Mr Ek’s recent comments to a Swedish newspaper that, while Spotify intends to keep its position as the number one music player, “it is enough to be among the top three” in a larger market.

“This is the biggest opportunity for the space to grow,” said Mr Forster, adding that “the game is going to be very different now.”

Within the days following the launch of Apple Music, Spotify closed a $526m funding round that values the Swedish company at $8.53bn and revealed that it now has 75m active users, of whom 20m are paying customers – up from 40m and 10m just over a year ago.

However, financial results published in May show that although Spotify, the highest-valued VC-backed company in Europe, surpassed €1bn in revenues for the first time, its operating loss widened by 81pc to €165.1m and its net loss increased threefold to €162.3m.

Mr Forster said that profitability is not an immediate concern for Spotify. “We don’t think it would be helpful to slow down right now.”

Its business model took a high-profile knocking last year when Taylor Swift removed her catalogue from the streaming service, saying that music should not be free.

Ms Swift announced last week that her latest album, 1989, will be available to stream on Apple Music after the iPhone maker agreed to pay artists during the initial three-month free trial. However, users will still be able to access the music for free until the period expires.

“At times it feels like a wilful refusal to understand our business model,” said Mr Forster, speaking before Ms Swift agreed to publish her album on Apple Music. “When people say they don’t want their music to be free – let’s try and be consistent. We just expect our partners to treats us fairly and consistently.”

He said Billy Bragg’s comment on the issue was one of his favourites. The musician posted on Facebook in November 2013: “I've long felt that artists railing against Spotify is about as helpful to their cause as campaigning against the Sony Walkman would have been in the early '80s.”

Mr Foster is confident in Spotify’s business model – even more so now that Apple has given its nod of approval.

“Ten years ago it wasn’t fun, but other industries look at music with envy now,” he said. “When we started we couldn’t compete… Now we’ve taken on piracy, which had no rules and no structure. It just goes to show that a Facebook can happen after a MySpace, a Google can happen after an AltaVista.

“But things could go a lot faster. We have 75m streaming users. Why not 750m? I struggle to think why that can’t happen.”

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Middle East allies accuse Barack Obama and David Cameron of failing to show strategic leadership in fight against ISIS, as MPs could be given vote on whether to bomb Syria

The United States has blocked attempts by its Middle East allies to fly heavy weapons directly to the Kurds fighting Islamic State jihadists in Iraq, The Telegraph has learnt.

Some of America’s closest allies say President Barack Obama and other Western leaders, including David Cameron, are failing to show strategic leadership over the world’s gravest security crisis for decades.

They now say they are willing to “go it alone” in supplying heavy weapons to the Kurds, even if means defying the Iraqi authorities and their American backers, who demand all weapons be channelled through Baghdad.

High level officials from Gulf and other states have told this newspaper that all attempts to persuade Mr Obama of the need to arm the Kurds directly as part of more vigorous plans to take on Islamic State of Iraq and the Levant (ISIS) have failed. The Senate voted down one attempt by supporters of the Kurdish cause last month.

The officials say they are looking at new ways to take the fight to ISIS without seeking US approval.

“If the Americans and the West are not prepared to do anything serious about defeating ISIS, then we will have to find new ways of dealing with the threat,” said a senior Arab government official. “With Isil making ground all the time we simply cannot afford to wait for Washington to wake up to the enormity of the threat we face.”

Western leaders increasingly accept that the “war on Isil” has not gone well, from the moment last year Mr Obama called the group a “JV [junior varsity] team” of jihadists compared with al-Qaeda. At that point, Isil had seized Fallujah, which US forces took in a bloody battle in 2004. It went on to take much of western Iraq and large areas of Syria, and in May took Ramadi, the capital of Anbar province.

Britain is moving closer to expanding its role in the war. The Government on Wednesday gave its strongest indication yet that MPs will be given a new vote on whether to bomb Isil in Syria.

Michael Fallon, the Defence Secretary, said it was “illogical” that British planes were able to hit extremists in Iraq but not across the border.

Any decision to bomb in Syria would have to be approved by MPs. In 2013, the Prime Minister lost a vote for British military action in Syria. However, Mr Fallon said: “It is a new Parliament and I think new Members of Parliament will want to think very carefully about how we best deal with Isil, and the illogicality of Isil not respecting the borderlines.”

Mr Fallon suggested that a bombing campaign could be mounted in revenge for the terror attacks in Tunisia if a link could be proved between the killer and Isil in Libya. Britain would only take military action in Libya “where we think there is an imminent threat, a very direct to British lives or, for example, to British hostages”, he said.

Senior Whitehall sources did not distance themselves from Mr Fallon’s comments but insisted there was no immediate prospect of military action.

The Telegraph understands that Mr Cameron is concerned that Labour might force the Government into another defeat over Syria.

SEE ALSO: Israeli defense official: 'Syria is gone'

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History will be made on September 9 when the Queen becomes the longest-reigning British monarch, but the day is likely to pass with little fanfare after a privately-funded concert to mark the occasion raised just £15 in donations.

With no official celebrations taking place, the British Monarchist Society decided to take the initiative by organising the show at the 02 Arena in London, and launched a crowd-funding appeal to raise £65,000 to cover costs.

So far, however, just two people have made donations, and with the full £65,000 needed by July 22, the chances of the concert going ahead look slim.

The only other event planned to mark the occasion is a Queen-themed message which will be projected onto the Tower of London, though its main purpose is to promote a forces charity.

Buckingham Palace said it was focusing on the Queen’s 90th birthday next year as the main time for reflection on her reign, though she will carry out a low-key engagement in Scotland on September 9 so that the public will, at least, see her on the day she overtakes Queen Victoria’s record of 63 years and seven months.

The British Monarchist Society had hoped its Concert For The Queen would “show Her Majesty how much she is loved”. Acts including Elaine Paige, Rick Wakeman, Patti Boulaye and S Club 7 have been lined up, but with no backing from the Government or private sponsors, the BMS was relying on individual donors giving small amounts.

Thomas Mace-Archer-Mills, the chairman of the BMS, said: “It is unconscionable that no one person, organisation, or the government has given an thought to properly celebrating the most historic milestone in this nation’s history, let alone honouring Her Majesty for the life long service she has given the people of this world. A proper show of appreciation is only appropriate.

“This generation has never witnessed a piece of history like this. The last people to do so were the Victorians and a reign of this length is unlikely to be seen again.”

The Tower of London, which remains an official royal palace, has gained approval from the Royal Household to beam a message onto its walls from one minute past midnight on September 10, saying “For Queen and Country”, to celebrate the landmark and promote the charity Coming Home, which helps provide adapted homes for wounded service personnel.

Lord Dannatt, Constable of the Tower of London and former head of the Army, said: “This will be a genuinely historic occasion, and a record that will not be beaten in a hurry.

“The Tower is the original royal palace, it has a special place in the hearts of the British people and it seems an entirely appropriate place to mark this unique event.”

A concert will be held in the Tower on September 16th to honour the Queen and to raise money for Coming Home.

For details of the concert, email FQAC@haighousing.org.uk

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Greece risks a collapse of the medical system, power black-outs, and an import blockade, if the Greek people reject creditor demands in a make-or-break referendum tomorrow, the EU's highest-elected official has warned.

Martin Schulz, the president of the European Parliament, said the EU authorities may have to prepare emergency loans to keep basic public services functioning and to prevent the debt-stricken country spinning out of control next week.

"Without new money, salaries won't be paid, the health system will stop functioning, the power network and public transport will break down, and they won't be able to import vital goods because nobody can pay," he said.

Mr. Schulz earlier called for the elected Syriza government to be replaced by "technocrat" rule until stability is restored.

The alarmist warnings are part of an escalating pressure campaign by European leaders as Greeks decide their destiny in what has become — despite attempts by Syriza to present it otherwise — an in-out vote on euro membership after five years of economic depression and mass unemployment.

Yanis Varoufakis, the Greek finance minister, said his country is on "war-footing" and accused the eurozone of trying to terrify Greek voters into submission.

"What they're doing with Greece has a name: terrorism. Why have they forced us to close the banks? To frighten people. It's about spreading terror," he told El Mundo.

The complete breakdown in trust between Syriza and the EU-IMF inspectors comes as polls show the "No" side neck and neck, each driven by powerful emotions in the bitterly divided country.

An estimated 40,000 people gathered for a rally for "No" side on Friday in front of the Greek parliament, drawn by a star-casting of Greek singers and defiant appearance by premier Alexis Tsipras.

Some 18,000 thronged a nearby stadium for the "Yes" campaign, blowing whistles and waving Greek and EU flags, many afraid that Greece would be blown out of the EU altogether after 34 years, and cast into oblivion.

The crisis has reached a point where Greece's manufacturing system is grinding to a halt. Crucial imports and raw materials have been stuck in ports since imposition of capital controls and the shut-down of the banking system a week ago.

Industrialists cannot pay suppliers outside the country unless they are deemed a top priority by an emergency payments committee at the Greek treasury. Hundreds of factories and mills may be forced to close down as soon as next week.

Mr. Varoufakis angrily dismissed "malicious rumours" that Greece's banks are drawing up plans to seize a share of all deposits above €8,000 in a so-called "bail-in." This is far below the EMU-wide deposit guarantee of €100,000.

The claims have been widely aired by Greek television and the conservative press, though no sources have been identified.

Louka Katseli, the head of the Greek banking association, said the reports were fiction.

The situation is clearly desperate, however. Mr. Varoufakis told the Telegraph earlier that Greece's banks will run out of cash over the next two days. "We can last through to the weekend and probably to Monday," he said. Greeks were still able to withdraw €60 a day — in reality down to €50 — with local cards from ATM machines earlier today. Foreign cards have no limit but it is far from clear whether that can continue.

Mr. Varoufakis appears ready to sit out a long siege if necessary. "We have six months stocks of oil and four months stocks of pharmaceuticals," he said.

The finance ministry is allocating much of the country's scarce liquidity for imports of food to avert a disaster as the tourist seasons reach a crescendo. He said there is no risk of food shortages.

Romano Prodi, former chief of the European Commission and Italy's ex-premier, said it is the EU's own survival that is now at stake as the botched handling of the Greek crisis escalates into a catastrophe. "If the EU cannot resolve a small problem the size of Greece, what is the point of Europe?"

"I would like to know how Merkel, Juncker, or Lagarde can possibly take it upon themselves to throw Greece out of the euro. It is true that irrational behaviour always recurs in history. The First World War broke out over a minor incident. Let us hope this is not our Sarajevo," he said.

It has emerged that European members on the board of the International Monetary Fund tried to suppress the publication of a report by the IMF showing that Greece's debt is "unsustainable" and that the country is in grave need of debt relief.

This validates the claim by Syriza that a deal without debt restructuring fails to go to the root of the problem, and merely ensures another crisis later. Angry staff members at the IMF leaked parts of the paper to the German press, forcing full publication.

The EMU creditors have so far refused to offer any debt relief. The danger is that this hard line will backfire, forcing Greece to default on an estimated €340bn of liabilities to the eurozone system. This would entail vastly greater losses for the creditors.

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