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Philly requiring bloggers to pay $300 for a business license - (www.washingtonexaminer.com) It looks like cash hungry local governments are getting awfully rapacious these days:
Between her blog and infrequent contributions to ehow.com, over the last few years she says she’s made about $50. To [Marilyn] Bess, her website is a hobby. To the city of Philadelphia, it’s a potential moneymaker, and the city wants its cut.
In May, the city sent Bess a letter demanding that she pay $300, the price of a business privilege license. “The real kick in the pants is that I don’t even have a full-time job, so for the city to tell me to pony up $300 for a business privilege license, pay wage tax, business privilege tax, net profits tax on a handful of money is outrageous,” Bess says. It would be one thing if Bess’ website were, well, an actual business, or if the amount of money the city wanted didn’t outpace her earnings six-fold. Sure, the city has its rules; and yes, cash-strapped cities can’t very well ignore potential sources of income. But at the same time, there must be some room for discretion and common sense.
When Bess pressed her case to officials with the city’s now-closed tax amnesty program, she says, “I was told to hire an accountant.”
TXU Tumbles as Natural Gas Imperils Biggest LBO: Credit Markets - (www.bloomberg.com) Bonds of the former TXU Corp., the largest leveraged buyout in history, are tumbling as a plunge in natural gas prices raises concern the company may have a harder time meeting its debt payments. Notes of Energy Future Holdings Corp., renamed after KKR & Co. and TPG Capital paid $43.2 billion for the electricity provider in 2007, lost 10.1 percent last month, the largest decline among the 50 biggest issuers of junk-rated corporate debentures in the U.S., according to Bank of America Merrill Lynch data. That followed a 3.66 percent drop in the second half of July. Investors are speculating the 22 percent decline in natural gas prices in August, the most since July 2008, will curb the Dallas-based company’s revenue. Moody’s Investors Service says Energy Future already faces a “very weak financial profile, untenable capital structure, questionable long-term business plan and material operating headwinds.” “They live and breathe in a market that prices off of natural gas,” said Jason Brady, a managing director at Thornburg Investment Management in Santa Fe, New Mexico, which oversees about $60 billion in assets, including Energy Future loans. “They just don’t make enough money to service all that debt. At $8 gas they do, at $4 gas, they don’t.”
5 percent pay increase for Oregon state union employees begins Wednesday - (www.oregonlive.com) A step pay increase of nearly 5 percent for Oregon state workers represented by unions goes into effect Wednesday. Some workers will get the pay hike immediately and the rest on their hiring anniversary, the Statesman Journal reports. The 4.75 percent increase will cost the state as much as $16 million through the end of the two-year budget period. The Department of Administrative Services, which negotiates union contracts with state workers, says the Legislature has already budgeted for the added expense. Critics like Rep. Dennis Richardson of Central Point says the state can't afford it. But union officials say the step increase is two years overdue and state workers have had mandatory unpaid days off and a freeze on cost-of-living increases.
Developer Sells Zero of 141 Luxury Condos - (www.pe.com) After two months of marketing his 141 luxury condos with not one sale, Mark Rubin said he has given up wooing buyers to the Raincross Promenade project in downtown Riverside that cost him $40 million to build. But he said prospective buyers kept trying to beat down his prices, even after he shaved $30,000 off the initial list prices ranging from $240,000 for a one-bedroom, one-bath condominium to $475,000 for a two bedroom, 2 ½-bath townhouse. "There were no sales," Rubin said. "Everyone wants a bargain. They read about foreclosures and think they can buy for distress prices." Because he paid cash to develop the property, Rubin said he is under no threat of foreclosure from a bank and under no pressure to drop his prices. He said he had promised the Riverside City Council he would attempt to sell the units but that nobody of the council had expected the condos would sell in the current economy and nothing legally prevents him from converting the project to apartments.
Postal Service sees $764M July loss, fiscal year-to-date net loss of $6.1 billion - (www.dmnews.com) The US Postal Service saw a net loss of $764 million in July, bringing its 10-month fiscal year-to-date net loss to more than $6.1 billion. The organization ran a net loss of $865 million in July 2009, according to preliminary numbers filed with the Postal Regulatory Commission. Mail volume was up 0.9% year over year to 13.8 billion pieces. Of that, 13.7 billion pieces were handled by the USPS' mailing services unit. However, for its fiscal year to date, the USPS saw a 4.3% decrease in mail volume to 142.7 billion pieces. The USPS also saw a net operating loss of $753 million for July. The unaudited numbers were provided by the Postal Regulatory Commission. In July, the Postal Service also cut total work hours by 5% year over year to 97 million work hours. For FY 2010 to date, it has cut work hours by 6.5% to 989 million work hours. Earlier this month, the USPS reported a net loss of $2.5 billion for June, a significant increase from the $1.3 billion reported in June 2009. Joseph Corbett, CFO of the Postal Service, warned this month that the organization might not be able to meet all financial obligations for next year, given ongoing trends. The Postal Service is seeking approval from Congress and the Postal Regulatory Commission on a number of major changes to its services. It has proposed enacting an “exigent price increase” for 2011 that must be approved by the PRC, its oversight body. The USPS has also asked for permission to reduce home delivery to five days per week and promised to make its consumer- and business-facing services more convenient.
Abandoned boats litter waters in tough economy - (www.usatoday.com) States across the USA are taking steps to deal with an armada of derelict boats abandoned by their owners in a tough economy:
· In Massachusetts,Democratic Gov. Deval Patrick signed a bill this month that gave local governments the power to seize abandoned vessels. The problem was growing faster than the state's ability to deal with it, says Michael Nichols, legal counsel to Democratic state Rep. Antonio Cabral, who introduced the bill. "The recession was affecting people's ability to keep and maintain a boat," Nichols says. "To have abandoned vessels taking up valuable space in the marinas and harbors was a problem." Fines for abandoning boats in state waters vary. In Massachusetts, it's $10,000. In South Carolina: $475.
· In Washington state, one of seven states where lawmakers set aside money to collect and dispose of abandoned boats, the number of vessels collected rose from 16 in all of 2009 to 17 in the first half of this year, says Melissa Ferris, manager of derelict vessel removal at the Department of Natural Resources. In 2007, the state increased the portion of each boat license fee used for that purpose from $2 to $3, providing $1,745,800 for vessel removal for 2009 and 2010.
OTHER STORIES:
Citigroup Proclaims ‘Cult of Equity’ Has Died: Chart of the Day - (www.bloomberg.com)
Libor Falls as Banks Sit on Cash - (www.dowjones.com)
Airline Era Ends as Carriers Cull 50-Seat Jets ‘Nobody Wants’ - (www.bloomberg.com)
Dollar falls vs euro, higher-yielding currencies - (www.reuters.com)
Fed May Face Less Pressure to Add Stimulus After Jobs Report - (www.bloomberg.com)
Goldman Sachs Said to Be Shutting Proprietary-Trading Division - (www.bloomberg.com)
Oregon's Public Employee Retirement System (PERS) in Deep Trouble, Taxpayers on the Hook - (Mish at globaleconomicanalysis.blogspot.com)
Oregon's Death Spiral; Business Owners Say "I'm moving out" - (Mish at globaleconomicanalysis.blogspot.com)
City of Philadelphia Charging Bloggers - (www.broadstreethockey.com)
Market Data Firm Spots the Tracks of Bizarre Robot Traders - (www.theatlantic.com)
401(k) Withdrawals Spike - (money.cnn.com)
Oregon tax revenues from Measure 66 coming up short of predictions - (www.oregonlive.com)
Oregon Wins Blue Ribbon for Unfounded Optimism; Everything "Weaker than Expected" - (Mish at globaleconomicanalysis.blogspot.com)
Edge of Financial Chasm - (Mish at globaleconomicanalysis.blogspot.com)
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