Report: State Personal Income Tax Cliff Diving – Calculated Risk
States in Deep Trouble Over Plunging Income Tax Revenues – Mish
20 states depending on personal incomes taxes for > 25% of total taxes were down 20% or more on collections.
This is a very grim report on state finances.
Weekly Unemployment Claims – Calculated Risk
Obama Blueprint Deepens Federal Role in Markets – The Washington Post
The White House makes its case for this approach in an 85-page white paper that describes the roots of the crisis. Gaps in regulation allowed companies to make loans many borrowers could not afford. Funding came from new kinds of investments that were poorly understood by regulators. Big firms paid employees massive bonuses, while setting aside little money to absorb potential losses.
"While this crisis had many causes, it is clear now that the government could have done more to prevent many of these problems from growing out of control and threatening the stability of our financial system," the white paper says.
The plan is built around five key points, according to a briefing last night by senior administration officials and a copy of the white paper obtained by The Washington Post.
The proposals would greatly increase the power of the Federal Reserve, creating stronger and more consistent oversight of the largest financial firms.
It also asks Congress to authorize the government for the first time to dismantle large firms that fall into trouble, avoiding a chaotic collapse that could disrupt the economy.
Federal oversight would be extended to dark corners of the financial markets, imposing new rules on trading in complex derivatives and securities built from mortgage loans.
The government would create a new agency to protect consumers of mortgages, credit cards and other financial products.
My Thoughts: This is another power grab by The Fed…do we really need a handful of appointed (not elected) people (with no oversight or accountability) with this much power?
Obama's Blueprint for Reform Concentrates Still More Power in Hands of the Fed – Mish
Hedge Fund Instant IPO Tests the New Complacency: Jonathan Weil – Bloomberg
The near-collapse of the financial system was supposed to have reminded the world about the hazards of chasing short-term gains at the expense of long-term stability. Another lesson we keep relearning is that investors’ memories are short.
Geithner Defends Plan to Give Fed Stepped-Up Powers in Overhaul – Bloomberg. There’s a shocker.
China risks trade suicide – Telegraph, Ambrose Evans-Pritchard
Democrats push to suspend California high school exit exam – The Sacramento Bee
A California law requiring high school seniors to pass a high-stakes exit exam before receiving their diplomas is targeted for elimination, at least temporarily, because of the state's fiscal mess.
Democratic legislators are pushing the idea of lifting the mandate, arguing that it's not fair to expect schools hammered by budget cuts to meet every threshold they have in the past.
Forecast for California: gradual clearing – The Los Angeles Times
An economic recovery will begin in the second half of this year, but many Californians won't feel the benefits until 2010, forecasters from Chapman University said Wednesday.
That's because the Golden State is in its deepest and most profound recession since the Great Depression, dragged down by sluggish construction activity in both the residential and nonresidential markets.
Danville approves slimmed down budget – The San Ramon Valley Times
The Danville Town Council has approved a budget that includes cuts, though officials said the cuts aren't on par with the slashing taking place in other cities.
The vote, which came Tuesday after a number of previous meetings on the issue, was 5-0. The $25.3 million budget for 2009-10 is $1.7 million, or 6.4 percent, less than last year.
"This is the second year in a row with significantly less revenues," Town Manager Joe Calabrigo said. "While Danville is much better than other cities, the recession has really created a new paradigm for local government."
Services spared as Pleasanton OKs two-year budget – The Contra Costa Times
The city balanced its budget in part by eliminating 10 vacant positions, reducing the nonpersonnel budget by 10 percent, suspending salary adjustments for the next 12 months, not calling for additional salary adjustments for labor contracts when they come up, and suspending transfers to various funds.
"The operating budget is balanced, and that is the good news," said Nelson Fialho, Pleasanton's city manager. "The bad news is the economy is in such a fragile state that it will probably be a challenge to keep that budget balanced over the next two years."
Female Homeowners Sadder, Fatter Than Renters – Clusterstock
Researchers from Wharton have discovered that female omeowners, on average, outweighed renters by 12 pounds. Female homeowners were also carrying around more aggravation, making less time for leisure, and were less likely to spend time with friends.
Jim Chanos on CNBC: The Financial Overhaul with Probably Fail
Selling a House: A How-To Guide for Post-Bubble Times – Minyanville, Carol Kopp
You want the spoiler now? We accepted a full-price offer on the house 5 days after it went on the market. Taxes settled, costs paid off and a modest inheritance to split, as our mother had hoped and expected. It had taken about 5 months to get it ready for the market.
The strategy in a nutshell: We held an estate clearance sale to empty the house, used the proceeds to spruce up the place, and didn’t argue with our real estate agent.
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