Gloomy Times

Our monthly finance report follows the continuing story of month to month; the economy is still sluggish and could get worse.

EMPLOYMENT - "Between December 2007 -- the official first month of the recession -- and December 2009, the U.S. economy lost more than eight million jobs," write CEPR's John Schmitt and Tessa Conroy. "Even if the economy creates jobs from now on at a pace equal to the fastest four years of the early 2000s expansion, we will not return to the December 2007 level of employment until March 2014.
"And, by the time we return to the number of jobs we had in December 2007, population growth will have increased the potential labor force by about 6.5 million jobs. If job growth matched the fastest four years in the most recent economic expansion, the economy would not catch up to the expanded labor force until April 2021."

Here's a dramatic chart from CEPR showing the total number of jobs lost since the recession began:






BUSINESS BURST -- NEW ON NEWSSTANDS -- “FORTUNE Global 500: The World's Largest Corporations,” by total revenues for fiscal year: 1. Wal-Mart Stores 2. Royal Dutch Shell 3. Exxon Mobil 4. BP 5. Toyota Motor 6. Japan Post Holdings 7. Sinopec 8. State Grid 9. AXA 10. China National Petroleum 11. Chevron 12. ING Group 13. General Electric 14. Total 15. Bank of America Corp. 16. Volkswagen 17. ConocoPhillips 18. BNP Paribas 19. Assicurazioni Generali 20. Allianz 21. AT&T 22. Carrefour 23. Ford Motor 24. ENI 25. J.P. Morgan Chase & Co.

STUDENT LOANS - The share of borrowers who default on their student loans is bigger than the federal government's short-term data suggest, with thousands more facing damaged credit histories and millions more tax dollars being lost in the long run.

According to unpublished data obtained by The Chronicle of Higher Education, one in every five government loans that entered repayment in 1995 has gone into default. The default rate is higher for loans made to students from two-year colleges, and higher still, reaching 40 percent, for those who attended for-profit institutions.

Borrowers who default on their student loans face significant personal and financial burdens. They become ineligible for additional federal aid and may have their wages and tax refunds seized by the government. Their negative credit records make it harder for them to obtain car loans, mortgages, and credit cards, and even apartments or jobs. When they can get loans, they pay higher interest rates.

But it's the high rates of default at for-profit institutions that are likely to get the most attention from members of Congress, who have recently raised concerns about the cost and quality of for-profit higher education. Fifteen years into repayment, two out of every five loans made to students who attended two-year for-profit colleges are in default.

SPORTS BLINK - Sports Illustrated names the “Fortunate 50” -- “50 highest-earning American athletes”: For the seventh consecutive year, SI.com has compiled a list of the 50 top-earning American athletes by salary, winnings, endorsements and appearance fees. The average earnings of those on the list have reached an all-time high of $26.2 million (up 11 percent from '09).” The top 10: 1. Tiger Woods, $90,508,163 … 2. Phil Mickelson, $61,660,757 … 3. Floyd Mayweather Jr., $60,250,000 … 4. LeBron James, $45,779,912 … 5. Alex Rodriguez, $37,000,000 … 6. Shaquille O'Neal, $37,000,000 … 7. Kobe Bryant, $33,034,375 … 8. Derek Jeter, $31,000,000 … 9. Peyton Manning, $30,800,000 … 10. Dwayne Wade, $27,779,912.

NYT, 'Next Big Battle in Washington: Bush's Tax Cuts,' by David Herszenhorn: 'An epic fight is brewing over what Congress and President Obama should do about the expiring Bush tax cuts, with such substantial economic and political consequences that it could shape the fall elections and fiscal policy for years to come. Democratic leaders, including Mr. Obama, say they are intent on letting the tax cuts for the wealthy expire as scheduled at the end of this year. But they have pledged to continue the lower tax rates for individuals earning less than $200,000 and families earning less than $250,000 - what Democrats call the middle class. Most Republicans want to extend the tax cuts for everyone, and some Democrats agree, saying it would be unwise to raise taxes on anyone while the economy remains weak. If no action is taken, taxes on income, dividends, capital gains and estates would all rise. The issue ... will move to the top of the agenda when lawmakers return to Washington in September from their summer recess, just as the midterm campaign gets under way in earnest.'

BIRTHDAYS THIS WEEK – Birthday wishes and thoughts this week for: Rick Blix…famous artist, Bill Bradley, Sandra Bullock, Ken Burns, Peggy Fleming, Dorothy Hamill, Mick Jagger, Martina McBride, J.K. Rowling, Arnold Schwarzenegger, Alessandro Suffredini…famous nephew.

GOOD BYE – To Daniel Schorr, a great journalist and humanitarian.

TRAVEL – The Eastern Sierras of California, nothing is better: Red Rock Canyon to the Alabama Hills to Mount Whitney to Inyo National Forest to the Mammoth Lakes Basin – Olancha to Lone Pine to Independence to Big Pine to Bishop to Crowley Lake to Tom’s Place to Convict Lake to Mammoth Lakes – wow!

FINALLY – It is the purpose of this blog to inform, offer insight and opinion. Our goal is not to pass judgment on individuals or organizations.

Beginning this month though we will honor, on a monthly basis, those who go beyond the call of duty to humiliate themselves; it will be called the JACKASS AWARD. This inaugural month we have two very deserving winners.

The Bell California City Council – who this past week showed how truly out of touch with reality municipal government can be. It would be wise of every citizen to review the pay scales of their public officials (especially the pensions).

Alden Reimonenq – who this past week showed how truly out of touch with reality higher education can be. Do these people have a clue????

Congratulations to the City of Bell California City Council and Alden Reimonenq for winning our inaugural Rink Rats JACKASS Award for the month of July.

Next week: A midsummer night’s dream.

Until next Monday, Arrivederci.


Claremont, CA
July 26, 2010

2012: Is it too early?

We will do it just once this year and many people say it is too early but Presidential Politics is beginning to heat up.

ROMNEY- “While splitting his time between a new home near San Diego and a place on New Hampshire's Lake Winnipesaukee, the former governor is also logging hours in three other places critical to a presidential run: Washington, New York and the campaign trail. … Romney has also retained the support of most of his top aides and advisers from his past campaign. He holds regular reunion gatherings with them and will invite his former team to his lake house next month for a summer cookout. Such consultants and operatives most likely will form the nucleus of a 2012 race, and no other potential candidate has such an infrastructure-in-waiting in place.”

Rink Rats predict a Romney, Louisiana Gov. Bobby Jindal ticket in 2012 – where is Sarah Palin? Don’t look for her until 2016.

Rink Rats also predict Vice President Biden will leave the ticket in 2012 and Hillary Clinton will be the VP candidate along with President Obama. Why you say.... a 2016 race of Hillary vs. Sarah is in the works. Laugh now, but put this in your hard disk drive. America will be ready for an all women Presidential race in 2016.
The Republicans will win a majority in the House this fall but they cannot beat Obama in 2012.

STATEMENT FROM FORMER VICE PRESIDENT CHENEY - “As many of you know, I have dealt with coronary artery disease for decades, suffering my first heart attack in 1978 at age 37. … A few weeks ago, it became clear that I was entering a new phase of the disease when I began to experience increasing congestive heart failure. After a series of recent tests and discussions with my doctors, I decided to take advantage of one of the new technologies available and have a Left Ventricular Assist Device (LVAD) implanted. The LVAD is a small implantable pump that improves heart function and will enable me to resume an active life. Last week I underwent surgery at Inova Fairfax Heart and Vascular Institute and had an LVAD implanted. The operation went very well and I am now recuperating. I am grateful for the wonderful care that I have received over the years at George Washington University Hospital, and that I am currently receiving at Inova Fairfax Heart and Vascular Institute. I also want to thank all of you who have included my family and me in your thoughts and prayers.”

SPORTS BLINK - ESPN.com, “Chasing the Bear,” by Rick Reilly in St. Andrews, Scotland: “I used to think Tiger Woods would pass Jack Nicklaus' 18 majors like a highway rest stop, but now I'm starting to wonder. He has 14, but he's 34 and aging like the portrait of Dorian Gray. … Most great players don't win majors past 40. … If we agree on the 40 thing, that leaves Woods with, more or less, five and a half years left in his prime -- 22 more majors. He's played 52 majors as a pro and won 14 of them, so that's about one in every four. Twenty-two chances to win five? For the old Tiger, a bunny layup. For the post-fire-hydrant, porn-star-plagued, gross-national-product-of-Peru-divorce-settling Tiger, a little harder.” Rink Rats predicted this a few weeks ago.

Congratulations to Louis Oosthuizen for winning The Open Championship, Rink Rats pick Ian Poulter finished 60th.

THE NATIONAL LEAGUE won last week's Major League Baseball All-Star game 3-1, and POLITICO's Daniel Strauss notes: “According to an analysis by University of Minnesota professor Eric J. Ostermeier, who writes the Smart Politics blog, a National League victory in the Midsummer Classic has preceded every election with double-digit GOP House gains since 1950. ... Since 1948, every time the Republicans have gained at least five Senate seats, the National League has won.”

DOES ANYONE CARE – The Tour de France ends July 25, the drug, ego plagued event has lost many followers this year.

BIRTHDAYS THIS WEEK – Birthday wishes and thoughts this week for: Cindy King, Nelson Mandela, Kathleen Turner, Pavel Datsyuk…Go Red Wings!, Don Henley, Patrick Pugliese…famous goaltender, Don Imus, Alison Krauss.

500 MILLION FRIENDS -- WashPost's Cecilia Kang: "Facebook is expected to say this week that it has reached 500 million users." We all need to get a life, seriously.

WHO REALLY LOOSES? - This week, the SEC settled its fraud case against Goldman Sachs for $550 million (4 days worth of Goldman's 2009 revenues), without the banking giant having to admit legal wrongdoing or fire any senior executives. On the same day, Congress passed a financial reform bill that left Wall Street's too big to fail banks bigger and more powerful than ever. Also gaining power: Tim Geithner, who continued to carry Wall Street's water by letting it be known behind the scenes that he opposes making Elizabeth Warren head of the new Consumer Financial Protection Bureau. Elsewhere, a federal appeals court ruled that uttering a fleeting expletive on TV wasn't obscene. If only an appeals court could do something about the obscenity of the Supreme Court allowing corporations to spend unlimited amounts on political campaigns.

LAME DUCK MAYOR - Antonio Villar of Los Angeles broke his elbow in a bike accident this past weekend. Reports say he biked into a pot hole.

Next week: Our monthly finance report and travelling in the Eastern Sierras.

Until next Monday, Arrivederci.

Claremont, CA
July 19, 2010

Broken Promises

Obama’s Broken Promises - L.A. Times lead story, “Scientists want more from Obama: Many say he's failed to follow through on promises to prevent political meddling,” By Tom Hamburger and Kim Geiger: “Interviews with several scientists … as well as reviews of e-mails … show a wide range of complaints during the Obama presidency: In Florida, water-quality experts reported government interference with efforts to assess damage to the Everglades stemming from development projects. … In Alaska, some oil and gas exploration decisions given preliminary approval under Bush moved forward under Obama, critics said, despite previously presented evidence of environmental harm. The most immediate case of politics allegedly trumping science, some government and outside environmental experts said, was the decision to fight the gulf oil spill with huge quantities of potentially toxic chemical dispersants … And the Union of Concerned Scientists, a Washington-based organization, said it had received complaints from scientists in key agencies about the difficulty of speaking out publicly.”

Sports – We are now into the middle of the golf season; congratulations to Paula Creamer on winning the U.S. Open this past weekend, my pick for this weeks’ British Open is the Rod Stewart look-a-like Ian Poulter, and after a weekend of golf in the Eastern Sierra’s I must say the vistas were beautiful because yours truly was in the woods the whole weekend.

Nonprofit Organizations Struggle – Compliments of our friend Joe Zanetta, “Community-based nonprofit organizations are struggling for their organizational lives these days. The oppressive economic downturn has made it hard to keep their doors open to provide services while fundraising from private individuals and foundations has become downright Darwinian."

Holy Family Adoption Services provides adoption, foster care, and family support services for infants and toddlers who are often born into very high-risk situations and require placement into a loving home. Since 1949, they have been helping these children whose mothers have been victimized themselves by family violence, or who suffer from addiction, or who are just ill-prepared for motherhood.

For most of its organizational life, Holy Family Adoption Services operated in partnership with the Catholic Archdiocese in Los Angeles. It had the financial and in-kind support from the church as well as the support of many generous Catholic individuals and foundations - until it became known that the Holy Family Adoption Services staff placed a handful of the thousands of children it cared for with same-sex couples. The State of California prohibits discriminating against same-sex couples in adoption placement and Holy Family Adoption Services was abiding by that state law.

In 2007, the Archdiocese of Los Angeles made it clear that Holy Family would have to stop placing children with same-sex couples. Instead of giving in, the Holy Family Adoption Services board of directors ultimately decided that nothing was more important than providing loving and supportive homes for at-risk infants and children and that no otherwise qualified home should be closed to these children simply because of the gender and sexual orientation of the family members within it.

The Catholic Archdiocese withdrew their support, as did most Catholic donors. Holy Family Adoption Services was forced to lay off staff, reduce services, and seek new sources of support in the midst of an economic recession.

Enter Bishop Jon Bruno of the Episcopal Diocese. When Bishop Bruno learned of Holy Family's courage and fate, he invited the organization to be housed under the auspices of his church. This kept the organization alive. But Holy Family Adoption Services valiantly limps on, and the organization requires new sources of support to continue on with their mission. While civic and public discourse these days seems to be dominated by scapegoating, intolerance, and even hate – Arizona’s anti-immigration legislation and California’s Proposition 8 battle embody such activity – we support organizations like Holy Family Adoption Services for their work with infants and all children. This is not a fundraising piece but it is reminding all of you to support in whatever way you can organizations who continue to add to the quality of life in our communities.

Next week: More summer time news and notes.

Until next Monday, Arrivederci.

Claremont, CA
July 12, 2010

Holiday Weekend News & Notes

July 4 holiday weekend, just some news and notes for this getaway weekend:

Claremont, CA - Rink Rats spotted some friends participating in the Claremont 5K run to celebrate the 4th; congratulations to Sula, Linda, and Carrie for participating and posting excellent times.

Debuting This Week: http://www.healthcare.gov , the administration's “new consumer website that provides unprecedented transparency into the health care marketplace … individuals will have more control over their health care as informed and empowered consumers.”

Telsa Motors: Telsa Motors shares shot nearly 41% higher on Tuesday in their first day of trade, an enthusiastic reception for the Silicon Valley electric car maker in sharp contrast to steep declines elsewhere in the equities market this week. Telsa is the first American car maker to go public in a half of century. The maker of the Roadster sports car (based in Southern California) raised $260 million from the sale of 13.3 million shares of stock. Telsa is a dog with fleas; it has lost $300 million since inception, and does not expect to make a profit until 2012 (if then). Why are investors in this economy still suckers???

Cupa Mondial - Rink Rats World Cup picks of an Argentina vs. Portugal final is history. But viewing the games has been intriguing to say the least.

Rink Rats Latest Fad Update: Silly Bandz - THE BIGGEST TWEEN FAD SINCE SWATCH WATCHES -- Silly Bandz gets a pic at the top of USA Today front page, with story on the cover of the Money section, “Silly Bandz mania takes shape”: “Silly Bandz are basically rubber bands that hold shapes such as a cat, fairy princess or - coming soon - SpongeBob. Annual sales of the Silly Bandz brand alone are north of $100 million … vs. $10,000 just two years ago. … Some college bookstores are stocking them for back-to-school. … Sarah Jessica Parker and Mary-Kate Olsen have been seen in them (and, no, they weren't paid to be). … Silly Bandz have been banned at some schools, summer camps and pools. But that only adds to their cachet with kids, who don't really give a hoot if the bands occasionally distract them from lessons, challenge blood circulation or clog pool filters. … One year ago, the company had 20 U.S. employees. Today, it has 400 in the USA and 3,000 in China, where Silly Bandz are made. One year ago, it was selling 100 packs of Silly Bandz a week. Today, it's selling 1 million. … Quiznos has a Silly Bandz kids meal on tap. Toys R Us has a big Silly Bandz back-to-school promo in the works. Marvel Comics and Nickelodeon recently signed licensing deals. … The company's never bought an ad. All Silly Bandz marketing has been word-of-mouth and viral via Facebook, Twitter and YouTube. … Toys R Us is … selling 'tens of thousands' of packs daily … And 7-Eleven, which sells several rival brands, figures it's sold 1.2 million packs in fewer than five months, and they aren't even in half its stores yet.'”

For those who are interested where their tax dollars go - The White House posts a searchable 2010 salary list for 469 employees. Annual pay for senior staff tops at $172, 200. http://whitehouse.gov

Hangover Remedies - For our Rink Rats followers who indulge in a bit too much of the spirits this holiday weekend, what to do with a hangover the morning after? Web MD tells us take two aspirin before bed and in the morning and drink plenty of water and more water. Alcohol dehydrates the body and water brings it back to normal. Personally, I find the “hair of the dog” remedy is the best: Kettle One Vodka and Red Bull will do the trick.

Top Finance Story - “Dems in a jam as jobs bill falls short,” by David Rogers: “Congress is poised to go home for the July 4th recess, leaving millions of jobless workers in the lurch because of a continued Senate impasse over financing unemployment benefits. Democrats fell one vote shy of the 60 needed in the Senate Wednesday night to end debate, and by the time lawmakers return July 12, the government estimates that as many as 2 million workers will be without assistance. The death of Sen. Robert Byrd (D-W.Va.) this week and defection of Sen. Ben Nelson (D-Neb.), a fiscal conservative from a low-unemployment state, helped to seal the fate. But more than any other one issue, the impasse over jobless benefits has come to dramatize the Republicans' almost single-minded focus on deficit reduction as an economic-and campaign-theme this election year. Just two Republicans, Maine Sens. Olympia Snowe and Susan Collins (St. Lawrence University ’74), joined in support of an estimated $34 billion bill to extend benefits through November. Early hopes of getting help from Sen. Scott Brown were dashed Wednesday when the Massachusetts Republican went to the Senate floor with his own alternative - heavily reliant on cutting unspent funds from last year's giant recovery act.”

Before You Eat the Left Overs – Adult obesity rates increased in 28 states in the past year, with the No. 1 ranking going to Mississippi, where 33.8% of adults are obese. 38 states have adult obesity rates above 25%. No state had an obesity rate above 20% in 1991. Colorado has the lowest rate of any state, 19.1%, California is 41st at 24.4%. 10 of 11 states with the highest obesity rates are in the South.

Finally, Cool Software - If you have not tried Skype communication software do so. I spoke to Sweden this past week to an online Finance student for fifteen minutes at no cost, amazing. http://skype.com

Next week: More summer time news and notes.

Until next Monday, Arrivederci.

Claremont, CA
July 5, 2010