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Thursday, July 19, 2012

Bankrupt California Cities List

This is a list of California Cities and Municipalities in or Near bankruptcy taken from the article California Cities and Municipalities In Or Near Bankruptcy.
Cities can file for bankruptcy if they are insolvent which means they are unable to pay debts that are due. When in bankruptcy, a city doesn't have to pay its creditors while it negotiates a plan for dealing with its debts. Municipal bankruptcies are extremely rare because cities have the power to tax. Since they can tax their citizens, cities have a hard time convincing a bankruptcy court that they truly cannot pay their debts.

  1. June 18, 2012: Stockton, with 300,000 residents
  2. July 2, 2012: Mammoth Lakes with 7,700 permanent residents
  3. July 10, 2012: San Bernardino with 209,000 residents
The dominoes are starting to topple. 

How many cities are "solving" their problems with dual pay structures where new workers get lower salaries and pay for or contribute more to their pensions like "regular" taxpayers that fund the cities?

How will dual pay scales affect moral and ability for public safety employees to work well together?

Tuesday, July 10, 2012

Fiscal Cliff is Like Dr. Strangelove's Doomsday Machine

The Bush tax cuts of 2001 and 2003 and the larger Obama tax cuts of 2009 and 2010 are scheduled to expire at the end of 2012. If congress and the white house don't reach a new agreement by the end of 2012, then on January 1, 2013 taxes will soar to their level before the 2001 Bush tax cuts and spending will also have mandatory cuts.

With the delicate state of the US economy, this is a "Doomsday" event everyone agrees we need to avoid but we worry there is not enough leadership to get it done.



This clip is from "Dr. Strangelove or: How I Learned to Stop Worrying and Love the Bomb," directed by Stanley Kubrick in 1964.

ECRI Says We Are In A Recession

Lakshman Achuthan, co-founder of the Economic Cycle Research Institute (ECRI ) told Bloomberg today that he believes we are now in a recession. It has ALREADY started.
Watch the video and read my summary of Lakshman's comments at:

For more information, read:
Click to order their book
Book: Beating The Business Cycle
In 2004, Lakshman Achuthan co-authored "Beating the Business Cycle: How to Predict and Profit from Turning Points in the Economy"

Friday, July 06, 2012

June Jobs Report

Today the Bureau of Labor Statistics of the U.S. Department of Labor released the June 2012 Jobs report. 80,000 new jobs were created in June while the unemployment rate remained the same at 8.2%. Highlights then the full press release follow:
  • Nonfarm payroll employment continued to edge up in June (+80,000), and the unemployment rate was unchanged at 8.2 percent, the U.S. Bureau of Labor Statistics reported today.  
  • Among the major worker groups, the unemployment rate for blacks (14.4 percent) edged up over the month, while the rates for adult men (7.8 percent), adult women (7.4 percent), teenagers (23.7 percent), whites (7.4 percent), and Hispanics (11.0 percent) showed little or no change. The jobless rate for Asians was 6.3 percent in June (not seasonally adjusted), little changed from a year earlier.
  • The change in total nonfarm payroll employment for April was revised from +77,000 to +68,000, and the change for May was revised from +69,000 to +77,000.

Full Report:

THE EMPLOYMENT SITUATION -- JUNE 2012

Nonfarm payroll employment continued to edge up in June (+80,000), and the unemployment rate was unchanged at 8.2 percent, the U.S. Bureau of Labor Statistics reported today. Professional and business services added jobs, and employment in other major industries changed little over the month.
Household Survey Data

The number of unemployed persons (12.7 million) was essentially unchanged in June, and the unemployment rate held at 8.2 percent. (See table A-1.)

Among the major worker groups, the unemployment rate for blacks (14.4 percent) edged up over the month, while the rates for adult men (7.8 percent), adult women (7.4 percent), teenagers (23.7 percent), whites (7.4 percent), and Hispanics (11.0 percent) showed little or no change. The jobless rate for Asians was 6.3 percent in June (not seasonally adjusted), little changed from a year earlier. (See tables A-1, A-2, and A-3.)

In June, the number of long-term unemployed (those jobless for 27 weeks and over) was essentially unchanged at 5.4 million. These individuals accounted for 41.9 percent of the unemployed. (See table A-12.)

Both the civilian labor force participation rate and the employment- population ratio were unchanged in June at 63.8 and 58.6 percent, respectively. (See table A-1.)

The number of persons employed part time for economic reasons (sometimes referred to as involuntary part-time workers) was essentially unchanged at 8.2 million. These individuals were working part time because their hours had been cut back or because they were unable to find a full-time job. (See table A-8.)

In June, 2.5 million persons were marginally attached to the labor force, down from 2.7 million a year earlier. (These data are not seasonally adjusted.) These individuals were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months. They were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey. (See table A-16.)

Among the marginally attached, there were 821,000 discouraged workers in June, a decline of 161,000 from a year earlier. (These data are not seasonally adjusted.) Discouraged workers are persons not currently looking for work because they believe no jobs are available for them. The remaining 1.7 million persons marginally attached to the labor force in June had not searched for work in the 4 weeks preceding the survey for reasons such as school attendance or family responsibilities. (See table A-16.)

Establishment Survey Data

Total nonfarm payroll employment continued to edge up in June (+80,000). In the second quarter, employment growth averaged 75,000 per month, compared with an average monthly gain of 226,000 for the first quarter of the year. Slower job growth in the second quarter occurred in most major industries. (See table B-1.)

Professional and business services added 47,000 jobs in June, with temporary help services accounting for 25,000 of the increase. Employment also rose in management and technical consulting services (+9,000) and in computer systems design and related services (+7,000). Employment in professional and business services has grown by 1.5 million since its most recent low point in September 2009.

Employment in manufacturing continued to edge up in June (+11,000). Growth in the second quarter averaged 10,000 per month, compared with an average of 41,000 per month during the first quarter. In June, employment increased in motor vehicles and parts (+7,000) and in fabricated metal products (+5,000).

Employment continued to trend up in health care (+13,000) and wholesale trade (+9,000) in June.

Employment in other major industries, including mining and logging, construction, retail trade, transportation and warehousing, financial activities, leisure and hospitality, and government, showed little or no change.

The average workweek for all employees on private nonfarm payrolls edged up by 0.1 hour to 34.5 hours in June. The manufacturing workweek edged up by 0.1 hour to 40.7 hours, and factory overtime was 3.3 hours for the fifth consecutive month. The average workweek for production and nonsupervisory employees on private nonfarm payrolls edged up by 0.1 hour to 33.8 hours. (See tables B-2 and B-7.)

In June, average hourly earnings for all employees on private nonfarm payrolls increased by 6 cents to $23.50. Over the year, average hourly earnings have increased by 2.0 percent. In June, average hourly earnings of private-sector production and nonsupervisory employees increased by 5 cents to $19.74. (See tables B-3 and B-8.)

The change in total nonfarm payroll employment for April was revised from +77,000 to +68,000, and the change for May was revised from +69,000 to +77,000.

____________ The Employment Situation for July is scheduled to be released on Friday, August 3, 2012, at 8:30 a.m. (EDT).



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