Tuesday, January 1, 2013

Wednesday January 2 Housing and Economic stories


Highest-Paid California Trooper Is Chief Banking $484,000 - (www.bloomberg.com) California Highway Patrol division chief Jeff Talbott retired last year as the best-paid officer in the 12 most-populous U.S. states, collecting $483,581 in salary, pension and other compensation. Talbott, 53, received $280,259 for accrued leave and vacation time and took a new job running the public-safety department at a private university in Southern California. He also began collecting an annual pension of $174,888 from the state.  Union-negotiated benefits, coupled with overtime that can exceed regular pay and lax enforcement of limits on accumulating unused vacation, allow some troopers to double their annual earnings and retire as young as age 50. The payments they get are unmatched by those elsewhere, according to data compiled by Bloomberg on 1.4 million employees of the 12 states. Some, like Talbott, go on to second careers. “I think some of our rules were negligent, and I think people were allowed to build up overtime pay who shouldn’t have been, who accumulated leave time and furlough time,” said Marty Morgenstern, a member of Governor Jerry Brown’s cabinet and secretary of the California Labor & Workforce Development Agency, which oversees labor relations, employment and unemployment.

Banker sleeps rough in park - (www.bbc.co.uk) Britain is in the grip of a housing crisis of a sort not seen before, where even the most unexpected people are losing their homes. Kevin Browne is an investment banker. He moved to America and ran his own firm until the crash in 2008. His company went bust and his marriage fell apart. He eventually lost his home and returned to England on a flight paid for by a charity. BBC Panorama met him last summer while he was sleeping rough in a park in Croydon. Panorama: Britain's Hidden Housing Crisis, BBC One, Thursday, 13 December at 21:00 GMT and then available in the UK on the BBC iPlayer.

Debt Loads Climb in Buyout Deals - (online.wsj.com) Private-equity firms are using almost as much debt to fund acquisitions as they did before the financial crisis, as return-hungry investors rush to buy bonds and loans backing those takeovers. The rise in borrowed money, or leverage, heralds the possibility of juicy returns for buyout groups. Ominously, the surge also brings back memories of the last credit binge around six years ago, which saddled dozens of companies with huge levels of debt. Some companies laden with debt by private-equity firms in the mid 2000s foundered during the recession. "Leverage is a double-edged sword," said Mark Goldstein, an investment banker to private-equity firms for RBC Capital Markets. "The gain is greater if the investment works out, but the consequence is also greater if things don't go as planned."

Nightmare infrastructure of subdivision houses - (www.kunstler.com) Even if the so-called economy were "recovering," the people of the USA would be stuck in a physical setting for daily life that has no future - the nightmare infrastructure of subdivision houses, strip malls, and WalMarts, all rigged up for incessant motoring. Of course, the so-called economy is not recovering because there is no more cheap oil. If oil ever gets cheap again, it will be because nobody has enough money to pay for it and surely you can connect the dots to what that hamster wheel of futility means.      In fact, the heart of our economic predicament is that the American economy came to be based on the construction of ever more suburban stuff, the financing of which, especially the houses, became the fodder for an episode of epic swindles that has left our banking system a hollowed out shell of accounting fraud. In short, we built even more stuff with no future, and ruined our society in the process. How tragic is that?

Greece's lenders warn of "very large" risks to bailout - (www.reuters.com)  Political resistance and potential court challenges are among "very large" risks to reforms required for Greece's bailout programme, the country's European lenders said on Monday. The long-awaited report from the European Commission and the European Central Bank details the findings of the "troika" of the EC, ECB and the International Monetary Fund on Athens' efforts to meet targets under its latest rescue package. The report formally confirmed that Greece deserved further aid under the 130-billion-euro (104 billion pounds) bailout, and a Greek finance ministry source said Athens had received a long-delayed instalment of over 34 billion euros in aid on Monday. But the lenders warned Athens still risked falling short on its commitments. "The key risks concern the overall policy implementation, given that the coalition supporting the government appears fragile and some components of the programme face political resistance, despite the determination of the government," the report said.

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