Posts Tagged ‘Schwarzenegger’

Here’s Why California’s Budget Crisis Is Going To Be Much Worse Next Year

Here’s Why California’s Budget Crisis Is Going To Be Much Worse Next Year

california

Courtesy of Joe Weisenthal, Business Insider 

California recently closed its budget, but in January the state will need to begin working on its next one.

According to the LA Times, a $19 billion hole is already projected, and here’s the problem: The easy budget cuts and the easy tax hikes are already in the books.

The are other problems, too. The new governor, whoever that is, will be reluctant to waste political capital (Schwarzenegger had the benefit of being a lame duck) and fresh legislators will once again have to learn how the whole process works (California has term limits, meaning nobody ever sticks around long enough to know how it works).

Also, the public has unrealistic expectations:

In a survey of 1,000 Californians conducted in June by the Pew Center on the States and the Public Policy Institute of California, half of respondents believed state spending could be cut 20% or more with no impact on services. The report points out that the state would have to eliminate the equivalent of its entire prison system, all welfare programs and all transportation spending to save that much.

The authors went to Mike Genest, Schwarzenegger’s former budget director, for some perspective.

"Reality hasn’t caught up with the voting public," Genest told them. "Politicians have made it sound like there are other alternatives, like we can simply get rid of fraud, waste and abuse and [have] a spending freeze and … have the same kind of government we’ve always had. … That’s just not true."

Anyway, assuming a big GOP sweep in November in DC, there won’t be much help coming from the Feds. Barring another tax-revenue-creating bubble, this should be quite a horror show.

Now see the 11 states most likely to default >

Image: AP


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Mish Cheers The Labor Unions

Mish Cheers The Labor Unions; Schwarzenegger Begs Obama For Money, Seeks Permanent State Pay Cuts, Proposes Privatizing Prisons

Courtesy of Mish

California is imploding right before our eyes. However, you do not have to be there to see it, all you have to do is listen to the panic in governor Schwarzenegger’s voice.

Please consider California’s Schwarzenegger wants more federal money

California Governor Arnold Schwarzenegger on Wednesday vowed to pry more dollars from the federal government, which he said took more than it gave, but left details on how to close a $19.9 billion state budget gap until later this week.

In a state of the state speech, the governor said creating jobs was the top priority for his last year in office and proposed spending $500 million in worker training funded by part of the budget which is in surplus.

"We no longer can ignore what is owed to us, or what we are forced to spend on federal mandates," Schwarzenegger told the combined state Assembly and Senate, which must support any budget plan by a two-thirds majority — a bar that has forced months of acrimonious debate in previous years.

Democratic State Controller John Chiang said lawmakers have little time to lose if California’s government is to avoid the same kind of cash shortages that last year forced it to hand out IOUs to pay its bills.

"They’re certainly a year older and I hope a year wiser," Chiang told Reuters.

State Treasurer Bill Lockyer, also a Democrat, described Schwarzenegger’s speech as "essentially the same" as other set pieces by the governor — middle of the road and long on optimism, such as the promise to safeguard education.

"It’s a little hard to square with the fiscal realities," he said, adding that others had tried for years to claw back money from the federal government and the governor might rely too much on such help in the budget plan he releases this week.

Meanwhile, the state needs to sell bonds in coming months to avoid shutting down infrastructure projects, Lockyer said.

Schwarzenegger put the budget hole at $19.9 billion over 18 months, about a billion less than a recent report from the state’s budget watchdog. He blamed the federal government for possible increases because of new healthcare costs.

A new national healthcare policy would be a ‘disaster’ for California, he said.


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Showdown in California: Schwarzenegger vs. Democrats

Showdown in California: Schwarzenegger vs. Democrats

Courtesy of Mish
 
The showdown is on in California between the Democrat controlled legislature and governor Schwarzenegger. The battle shapes up like this: Democrats do not understand basic math and Schwarzenegger is not giving in. The end result is California seen missing budget deadline again.

Barring a miracle, California lawmakers will miss their June 15 deadline for passing a balanced budget — a staggering challenge with the state facing a $24.3 billion shortfall amid the worst drop in state revenues since the Great Depression.

Observers of the most populous U.S. state’s political scene laugh at the idea of a budget deal by Monday.

"It’s about as likely as me being named MVP of the Stanley Cup final," said Dan Schnur, director of the Unruh Institute of Politics at the University of Southern California.

Citing the state’s weak economy and double-digit unemployment rate, the movie star-turned politician has ruled out new taxes, which has raised his standing with the legislature’s unruly and anti-tax Republican minority.

Schwarzenegger also urged Democrats to ignore lobbying by their union allies against sharply lower spending levels to help balance the state’s books.

"Do they want to protect the workers that provide the services, or do they want to protect the people that get those services? The choice is up to them," he said.

His blunt talk came as the Service Employees International Union launched an advertising campaign against his budget plan, a threat to many of its 700,000 members in the state.

State Senate President Pro Tem Darrell Steinberg has said spending cuts are inevitable, but he opposes Schwarzenegger’s plan for scrapping state programs. Instead, he wants to tap reserves in the governor’s plan to maintain the programs.

Understanding Negative Numbers

Tapping "reserves" is idiotic because California has negative reserves of $24 billion. Do the Democrats or the unions understand the concept of negative numbers?

Unfortunately the answer is a resounding "No". Some might think this is a reason to keep the education budget intact. However, the odds that the legislature or unions sign up for much needed remedial math education classes is zero. Therefore, saving taxpayer money must take precedence over spending that will not go to where it is most needed.

Schwarzenegger Threatens To Shut Down Government

If a deal


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Phil's Favorites

How to regulate Facebook and the online giants in one word: transparency

 

How to regulate Facebook and the online giants in one word: transparency

Courtesy of George BrockCity, University of London

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It Is Seven Times More Difficult To Get A Flight Attendant Job At Delta Than Enter Harvard

Courtesy of ZeroHedge. View original post here.

One of our preferred "off beat" economic indicators is how many workers apply at any one given moment in time for jobs that are hardly considered career-track. An example of this is the number of applicants for minimum wage line cook jobs at McDonalds, or flight attendant positions at Delta Airlines; conveniently, this is a series which we have tracked on and off for the past 7 years.

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Deutsche Bank Brightens Its View On Illumina

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Large Caps Accelerate Gains; Small Caps Breakout

Courtesy of Declan.

Friday belonged to Large Cap stocks as both S&P and Dow Industrials posted gains which looked better than the less than 1% they managed. Volume climbed to register accumulation. Technicals are healthy and the S&P posted a new 'buy' trigger relative to the Russell 2000 (Small Caps).  This may end up as a blow-off top but there is nothing in Friday's action to suggest such a top is in place.


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ValueWalk

Moody's Says Hartford Could Default As Early As November

By Gary St. Fleur. Originally published at ValueWalk.

The historic headquarters of insurance giants like Aetna, and Cigna, Hartford Connecticut now faces a potential financial catastrophe.

On Thursday, October 19, it was announce that the likelihood of Hartford Connecticut, to meet its obligations for the month grows continually bleak. Moody’s has produced a press release stating their position that Hartford Connecticut is likely to default by month’s end.

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Digital Currencies

An Evening in Wonderland

 

An Evening in Wonderland

Courtesy of 

 

 

You walk halfway across Rivington Street and in the middle of the block there’s an alley leading north, and then, inexplicably, it curves northwest. It’s remarkable in that on the Isle of Manhattan there aren’t any alleys. And this one is whimsical. Lights are strung overhead and artwork decorates the sides of the buildings as you make your way through. And then, at the end of Freemans Alley, you come to a tucked away restaurant in the back corner. It’s called Freemans (what else?).

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Biotech

Circadian rhythm Nobel: what they discovered and why it matters

Reminder: Pharmboy and Ilene are available to chat with Members, comments are found below each post.

 

Circadian rhythm Nobel: what they discovered and why it matters

Courtesy of Sally Ferguson, CQUniversity Australia

Today, the “beautiful mechanism” of the body clock, and the group of cells in our brain where it all happens, have shot to prominence. The 2017 Nobel Prize in Physiology or Medicine has been awarded to Jeffrey C. Hall, Michael Rosbash and Michael W. Young for their work on describing the molecular cogs and wheels inside our biological clock.

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Members' Corner

Day of Last Dances

News today has been relentlessly terrible. A horrific mass murder happened last night in Las Vegas. (Our politician's abject failure to address gun control is beyond sickening.) And today, reports that Tom Petty died of a heart attack, followed by reports that Tom Petty is not dead, and now reports confirming that Tom Petty has passed away. 

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OpTrader

Swing trading portfolio - week of September 11th, 2017

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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NewsWare: Watch Today's Webinar!

 

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Just click here at 1 pm est and join in!

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Kimble Charting Solutions

Brazil; Waterfall in prices starting? Impact U.S.?

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All About Trends

Mid-Day Update

Reminder: Harlan is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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