Monday October 5 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

CA Realtor can't sell his house, burns it down - (www.tracypress.com) A husband and wife are suspected of burning down their $1 million home in Tracy last summer — a blaze that almost killed several firefighters. Police on Friday arrested 31-year-old William “Billy” Tipton Jr. and issued an arrest warrant for his wife, 37-year-old Frayba Tipton, on suspicion of arson, forgery and insurance fraud. Billy Tipton faces additional charges of grand theft and two more counts of defrauding an insurance company. The Tiptons, who lost their upscale home to a suspected arson fire in July 2008, told the Press the day after that they had taken their five children to Lake Tahoe for a Fourth of July vacation and that the loss of their home devastated them. Not only did the fire destroy many of the family’s possessions, it also nearly killed several firefighters when it weakened the beams supporting a heavy slate roof that collapsed just 30 seconds after a fire chief ordered his crew out of the burning house. Investigators immediately suspected arson, said Germane Friends, the Tracy Fire Department Division Chief who pulled his crew out of the Fagin Drive fire with seconds to spare. “It was obvious at the time that it was an incendiary fire because it was started in so many different places,” he said today. “I know they started investigating that immediately.” For the past year since the blaze, insurance companies, the San Joaquin County District Attorney’s Office, Tracy police and the San Joaquin County Sheriff’s Office have investigated the incident and treated the gutted property as a crime scene. The investigation culminated in an arrest late last week. Billy Tipton — who used to own a branch of West Coast Realty and Mortgage in Tracy without a real estate or broker’s license — was taken into custody Friday night. The West High School Graduate and lifelong Tracy resident appeared in court on Monday — nervous and shackled — when his private attorney Timothy Rein asked a judge to postpone arraignment until Thursday. Billy Tipton was released from custody on Tuesday without having to pay a dime of his $300,000 bail because overcrowding at the San Joaquin County Jail squeezed him out. Frayba Tipton — owner of A+ Realty and Mortgage — is free of her own recognizance, but was ordered to appear in court with her husband on Thursday. The charges filed against the pair come as no surprise to several people who knew them. For the past few years, an architect, a graphic designer, several banks and at least two insurance companies were looking for the Tracy family for either money or an explanation. Public record paints a picture of a couple so dependent on the housing market that they lost virtually all of their property wealth when the economy tanked. They let several properties lapse into foreclosure as their income as real estate agents and brokers suffered from a dearth of buyers. Lawsuits demanding payment from Frayba and Billy Tipton show that the couple has had trouble keeping up with the bills for the past year or so. “I just want what they owed me,” said Ross Jetté, a Turlock architect who says the Tiptons owe him $12,000 for $17,000 blueprints they ordered two years ago but never finished paying for. Jetté said the family hired him to draw up plans for a 25,000-square-foot house they intended to build on their 40-acre property on East Lehman Road in Tracy, which has since lapsed into foreclosure, like the family’s other properties. The 25-year architect said he was paid only a portion of what was owed. But he said the Tiptons have proven difficult to find since the fire, so Jetté and other plaintiffs couldn’t collect. Dogged by lawsuits and angry clients from the couple’s real estate dealings, the Tiptons eventually disconnected their business, home and cell phones last fall. They moved into a two-story rental in Hidden Lakes, an upscale subdivision very close to their ruined home.

USDA (USDA?) Mortgages With No Money Down. Bad Idea. - (www.businessweek.com) NO THIS IS NOT A TYPO. USDA IS INSURING HOMES NOW AS WELL. Builders and lenders are dusting off a familiar pitch: mortgages with $0 down and 100% financing. The deals, which take advantage of a little-known loan program at the U.S. Agriculture Dept., are bolstering sales in some areas. These new mortgages share some characteristics with the old ones now wreaking havoc on the housing market—and critics fear lending standards could slip. Says Daniel Oppenheimer, an analyst with Credit Suisse: "Unlike beef, these loans should be described as USDA subprime." In the grand scheme of the $1.89 trillion residential real estate market, the USDA program—founded in 1949 to spur home sales and development in rural areas—is still a blip. But since the financial crisis, the program has exploded in size. As part of the Obama Administration's effort to prop up housing, the U.S. allocated $10.5 billion to the Agriculture Dept.'s guaranteed loan program this year, up from $6 billion in 2008 and $3 billion in the past. The result: The number of home loans guaranteed by the USDA swelled to nearly 120,000 in the first nine months of 2009, up from roughly 35,000 in all of 2007. Given the rampant development during the boom, many communities where the USDA loans are available aren't technically "rural" anymore—and include exurbs near big cities. Ashley-Gayle Boothe and her husband Scott have applied for a USDA-backed loan to buy their first home, a three-bedroom house 30 minutes north of Tampa, for $127,500. "We didn't want to put anything down," says Ashley-Gayle Boothe. "We figured we'd have to buy appliances." The government-backed loan program is buoying builders and lenders. Analysts say federal loans, including those guaranteed by the USDA, accounted for 64% of sales at builder D.R. Horton (DHI) in the latest quarter. In Port St. Lucie, Fla.—a coastal town littered with foreclosures and empty subdivisions—roughly one in five mortgages is coming through the Agriculture Dept., according to local industry players. "Everyone is fighting for every little sale they can get, and the USDA financing is a huge opportunity," says Jim Belfiore, president of Belfiore Real Estate Consulting in Phoenix. Housing experts question the wisdom of 100% financing for any borrower. Similar questionable lending decisions during the housing boom lie at the root of many distressed properties today. In the current environment the mortgages are particularly problematic since prices continue to fall in the areas where the Agriculture Dept. loans have proliferated. In one such place, Menifee, Calif., record foreclosures continue to depress home values. For owners, falling prices and no equity in their homes have proven a toxic combination, especially when they try to sell. The USDA, builders, and lenders defend their use of the loans. The agency argues it adheres to strict underwriting standards, assessing each borrower's credit, income, and cash flow. Joaquin Tremlos, acting director of the USDA's home loan program, says the agency's portfolio of loans has a low default and delinquency rate. The USDA "has not relaxed our guidelines.... We've intensified them to make sure that these loans continue to be sound."

Parking meters raise revenues, tempers – (www.sfgate.com) In an effort to stem a growing revolt, the Oakland City Council is expected to roll back evening hours for metered parking when it meets Tuesday - the question is how far. "I don't know if it will be 6 p.m. or 7 p.m.," said council President Jane Brunner. "It depends on how much money we can find or cut elsewhere." Like her colleagues, Brunner has been getting an earful from constituents over the triple whammy of meter rates climbing to $2 an hour, parking tickets being jacked up to $55, and meter hours being stretched to 8 p.m. from 6 p.m. On top of that, the city sent squads of ravenous ticketers into neighborhoods, nailing residents for minor violations that had long been ignored, like parking on sidewalks on narrow streets. The changes brought in badly needed bucks for the city. The price, however, was a firestorm among angry drivers and businesses that has been raging all summer. "I hear it everywhere - at weddings, in movie lines - people are angry," Brunner said. So, back goes the meter enforcement time, most likely. The only question is how the city will raise the $1.3 million a year that the extended hours were expected to bring in, said Councilwoman Jean Quan, who oversees the budget for the council. Unlike the change in meter times, the council is in no rush to reduce the new parking fines or meter rates. The question is: Will easing back on meter times cool Oaklanders' tempers? "No," said Grand Lake Theater owner Allen Michaan, who is among those talking about recalling council members if the parking changes aren't undone completely. "They have delivered a body blow to both business and residents of Oakland," Michaan said. Michaan doesn't just want to go back to the way things were. He wants 50-cents-an-hour parking - before the increase, it was $1.50 - and amnesty for those who have been dinged by the aggressive ticketing in the neighborhoods.

1 million use new-debtslave credit, evading taxes, keeping house prices unaffordable - (www.bizjournals.com) The deadline is Dec. 1 for first-time homebuyers to have completed a purchase of a house to qualify for the homebuyer credit of up to $8,000 from the federal government. So far, 1.4 million people have used the credit, including 160,000 in California, the Internal Revenue Service said Friday. The credit is 10 percent of the purchase price of a home, up to the maximum of $8,000. The credit either reduces a tax payment or is returned as a higher refund next year. There are income limits and other details about the credit, which is part of the government’s effort to reign in the housing crisis by reducing the inventory of homes on the market. According to a California Assoiation of Realtors survey, 40 percent of first-time buyers would not have purchased a home without the tax credit. Realtors association president James Liptak called on Congress to extend the credit.

FHA's Risky Loans Point to Bailout in Future - (www.bearishnews.com) The FHA has effectively replaced sub-prime lenders who went bust. They’re under pressure to prop-up housing prices, and are insuring heaps of risky loans in an effort to do so. Their guidelines are slipping and loan-volumes are skyrocketing. Delinquencies are skyrocketing too, reaching 14.4% in the 2nd quarter of 2009, according to the NYT (borrowers at least one payment late). Even more shocking is this number: In 2009 FHA has insured 23% of all new mortgages. That’s up from 2% in 2006 (source: LAT). That spells big trouble down the road. FHA loans have gone from being a small piece of the market with conservative guidelines to Countrywide-reborn. This Ditech.com screenshot (taken 9/18/09) advertises loose FHA Loan policies. They highlight “easier qualifying guidelines on FHA loans” and “flexibile credit and income guidelines“.

It looks straight out of a Countrywide commercial circa 2003, but I assure you I took it yesterday. Hard to believe we’re using these tactics again already. Can we at least get a little break between bubbles? “Easier Qualifying Guidelines”? Seriously?

Here’s another example of FHA-backed loans, from Wells Fargo this time (screenshot also taken 9/18/09) :

Notable: “Flexibile income, credit and debt guidelines, including non-traditional credit histories, incentives for public employees. Wells Fargo is offering “incentives for public employees”, as part of a government-loan guarantee program? That seems…off. Not to mention the line about those with “non-traditional credit histories”. Translation: “Even if you’re a questionable borrower, we can probably work something out. After all, we’re not going to eat the loss.”

OTHER STORIES:

California Joblessness Reaches 70-Year High - (www.nytimes.com)

California, Nevada Reach Record Unemployment Levels - (www.bloomberg.com)

California house sales fall 12 percent in August - (www.sfgate.com)

"Option" mortgages to explode, officials warn - (news.yahoo.com)

$30 billion CA mortgage time bomb set for 2010 - (www.sfgate.com)

Houseowners who 'strategically default' on loans a growing problem - (www.latimes.com)

Houses in FL worth less than 10 years ago - (www.sun-sentinel.com)

Selling at a loss is all too common for FL houseowners - (www.tampabay.com)

House prices won't regain peak in CA, FL until 2030's, if ever - (www.marketwatch.com)

Japan's Residential Land Prices Still Falling, 18 Years Later - (nni.nikkei.co.jp)

Debt Expansion Policies Still Threaten Recovery - (www.seekingalpha.com)

Volcker Sees Long Slog for U.S. Economy, Seeks Bank Limits - (www.bloomberg.com)

Capitalism's Inherent Instability - (www.boston.com)

Bill O'Reilly supports public insurance option. Really. - (www.dvorak.org)

Sunday October 4 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

3,000 retired educators take home six-figure pensions - (www.ocregister.com) Retired Capistrano Unified School District Superintendent James A. Fleming could face jail if convicted on a felony indictment charging him with using school resources to track his political enemies. But that won't stop his public pensions from rolling in. Fleming collects $141,331 a year in California state teacher retirement funds, on top of the $64,068 pension he collects from working 27 years in Florida. Even if convicted on the 2007 charges, both his pensions will remain untouched. Fleming is one of 3,090 educators in the California State Teachers' Retirement System who make at least $100,000 a year in taxpayer-guaranteed public pensions, according to a CalSTRS database obtained under the state Public Records Act. Most of the highly paid pensioners are superintendents and other district administrators. And some are pulling salaries from other jobs or pensions in other states. In contrast, the average STRS pension is just $36,252, according to June 2008 figures, the most recent available. Of the 196,000 retirees, only 1.6 percent receive $100,000 or more, but they account for 5 percent of the $8 billion yearly payout. The average retiree in 2008 had 29 years of service. "It definitely makes me wonder where the public gets the notion this is a windfall (for teachers)," said Kimberly Claytor, president of the Newport-Mesa Federation of Teachers. "Every educator I've known who is getting a STRS pension has spent decades – decades – providing services to children." Large public pensions have come under fire in recent months as state and local governments sag under the weight of runaway spending and a tanking economy. Like the California Public Employees’ Retirement System, the teachers’ retirement system is running into trouble as workers retire to larger pensions that are increasingly difficult to fund. While the average state teachers’ system pensioner collects $36,252, educators retiring last year did so to an average pension of $51,948. Officials calculate that the system will face a $23 billion funding gap by 2039. The Orange County Employees Retirement System faces similar pressures, but it is unclear exactly what is happening there because officials have refused to release their pension data to The Register. In July, a judge in Contra Costa County ruled that the retirement data in that county must be released in the name of government transparency. But OCERS insists that the same law and the judge’s ruling do not apply to Orange County. Los Angeles has the largest number of retired educators in the "$100,000-plus club," at 942. Orange County follows with 384 -- including a superintendent pushed out of her job without public explanation and another whose district amounted to just four schools. The teachers' retirement system is funded by the educators, the school districts they work for and by the state as well as investments. However, the teachers' system is different than others such as CalPERS in one important way – it cannot unilaterally raise the rates charged to districts to generate more money. And there is no mechanism to unilaterally charge the state to pick up the slack. Laws would need to be enacted to get the system more funds if the $23 billion budget gap materalizes as projected. "In this economic climate it is not feasible (to ask for more money)," said STRS spokeswoman Sherry Reser. "We're working at picking out a time in the future." Marcia Fritz, an official with the California Foundation for Fiscal Responsibility, a pension reform group, called STRS "unsustainable" because of the way it is set up. "They expect the state to bail them out," Fritz said. Pensions protected from criminal convictions: Retired educators defend their pensions, saying they sacrificed better paying private jobs for retirement security. Jake Abbott, who earns a pension of $103,868 as a former Fresno superintendent, said generous retirements are a way of encouraging good executives to take often tenuous jobs that may last years --- or merely months -- depending on the mood of the school board. "Often times they don't last very long. There has to be some incentive to take this volatile position," said Abbott, who now runs an Orange County executive search firm specializing in education. "Why would you take a job if you don't have at least some hope?" Indeed, generous retirements are a way to keep valuable leaders and employees happy. Consider James C. Enochs, the highest paid pensioner in the STRS system, at $285,460. Enochs was superintendent for 20 years at the Modesto City School District and an educator for half a century. A high school in Modesto bears his name. However, controversial – and sometimes convicted – officials also have benefitted from generous pensions. In California, state and federal constitutions protect the pension as a binding contract, even in the face of criminal prosecution. Becky Bauer, an activist in the Capistrano district, can't understand why James Fleming – whose office was raided by law enforcement investigators -- will still get his pension if convicted. "There is something wrong with that picture," Bauer said. "Is the motive to paying high pensions to attract the best and the brightest? In Fleming's case, we got the greediest." Fleming was collecting $348,307 in total compensation two years before his 2006 retirement, among the highest of any government official in Orange County. But most of his career had been spent outside California, so Fleming negotiated with the Capistrano district, which agreed to buy him five more years than the 15 he earned here. The district also agreed to cover his medical expenses in retirement, although he did not work the required 20 years. During his tenure in the Capistrano district, Fleming and some members of the school board were accused of violating open meeting laws and retaliating against opponents. Fleming's career came to an early end after a former aide turned over to the Orange County Register copies of an "enemies list," containing names of critics, their children and the schools they attended. Through his attorney, Fleming declined comment about his pension. Golden parachutes for problem educators: Forced retirement can also be used as a "golden parachute," ending the tenure of school leaders who are seen as problems. In late 2006, the Ocean View School District board was unhappy with the performance of Superintendent Karen Colby and met with her in closed session. After the confidential meeting Colby, who was already on administrative leave, chose to retire. The STRS database shows that Colby receives a pension of $134,515 a year. She could not be reached for comment. Another member of the "100,000-plus" club, former Orange Unified School District Superintendent Thomas Godley collects $210,211 a year. He was the budget chief for Newport-Mesa Unified when a finance worker siphoned $3.7 million to buy such things as full-length fur coats in 1992. Godley was one of several officials who received a vote of no confidence from Newport-Mesa teachers, although board members did not hold him responsible for the theft. Godley later became superintendent of Grossmont High School District in 1997, where he received another vote of no confidence from teachers at war with the school board. In an interview, Godley stressed that all superintendents are magnets for controversy or dissent, especially when employees are dissatisfied during contract negotiations. He added that school superintendents typically manage large organizations with large budgets and much at stake. "You take the same administrator with the same responsibility and that person would make more money in the private sector," Godley said. "And the trade off is good health benefits and good pensions. They give up high salaries for that." Not every superintendent runs a large organization. Former Laguna Beach Unified Superintendent Theresa Daem earns the eighth highest pension in the STRS system, at $235,224 a year – after retiring from a four-school district with just 3,700 students. By comparison, the next highest earner, Jack W. McLaughlin, at $239,907, ran a district with 46 elementary and high schools. “I’m just very lucky, to be honest with you. I paid into the system for 37 years and I ended up well paid in Laguna Beach,” said Daem, who worked nine years in Laguna.

Philly stays open, averting crisis - (cnn.money.com) Disaster averted. Philadelphia will not have to impose draconian budget cuts that would have closed its libraries, playgrounds and court system, as well as laid off 3,000 public employees. State lawmakers on Thursday approved the city's request to raise its sales tax by 1 percentage point and defer pension payments in order to balance its budget. Gov. Edward Rendell is expected to sign the measure. "All of the devastating consequences of Plan C will be avoided," said Mayor Michael Nutter, referring to his emergency proposal. The mayor was set to start sending out pink slips on Friday and had already announced the service changes would begin Oct. 2. Philadelphians, however, will not escape unscathed. They will now pay an 8% sales tax, as well as deal with city services reduced in prior budget cuts. The city first started cutting services in November, when the mayor announced Philadelphia was facing a $108 million deficit for the fiscal year, which ended June 30. Officials had to slice into the $4 billion budget, requiring non-union city workers to take furlough days, suspending scheduled business and wage tax cuts, removing equipment from some fire stations, reducing police overtime and cutting 800 mostly vacant positions. Philadelphia closed another $1.4 billion hole in its five-year spending plan this spring in part by raising fees and eliminating another 250 positions.

U.S. bolsters mortgage insurance agency - (cnn.money.com) With a growing number of homebuyers depending on government-insured loans, the Obama administration is taking steps to shore up the Federal Housing Administration program. Rising demand and a slower-than-expected rebound in home prices are pushing one of FHA's reserve accounts below the 2% ratio mandated by Congress, said Commissioner David Stevens. The capital reserves are a cushion against expected losses in the program, which has suffered soaring defaults amid the housing collapse. The FHA has skyrocketed in popularity during the mortgage crisis since it backstops banks if borrowers stop paying. Housing experts are growing increasingly concerned about the agency's ability to handle rising numbers of defaults. The drop in reserves, however, will not require a taxpayer-funded infusion into the housing agency, nor an increase in insurance premiums that FHA borrowers pay, Stevens said. The capital reserves, which are determined by an independent auditor and reported to Congress in November, will rise above the minimum threshold within a few years as the housing market recovers. The agency's overall reserves stand at more than $30 billion, a record level thanks to the large influx of premium-paying borrowers, Stevens said. It covers more than 4.4% of its insurance commitments. "To be clear, the fund's reserves are sufficient to cover our future losses, so the FHA will not require taxpayer assistance or new congressional action," Stevens said. Still, the agency is taking a number of steps to reduce the riskiness of the program, which allows borrowers to purchase a home with as little as 3.5% down. It plans to hire its first chief risk officer in its 75-year history and to increase net-worth requirements for approved lenders to $1 million, up from $250,000. Lenders will also be responsible for any losses resulting from fraud on the part of mortgage brokers.

Auto baron hit his own bump in the road - (cnn.money.com) Chrysler exec faces tax, loan troubles/ Lien placed on Deputy CEO Jim Press' home for nearly $1 million in unpaid taxes -- and he's also sued for unpaid loans. A top executive for Chrysler Group, the carmaker that recently went through a government-sponsored bankruptcy, is having more than $1.4 milliion of his own financial headaches. Jim Press, Chrysler's deputy chief executive, has had a lien for $947,409 placed on his home by the Internal Revenue Service, according to records from Oakland County, Mich., clerk's office. The lien against a house in the city of Birmingham, Mich., is for non-payment of 2007 taxes. Press is also being sued for $467,083, plus attorneys' fees, by the Western Federal Credit Union for unpaid loans plus interest and late fees. Western Federal absorbed the Toyota Federal Credit Union and, according to a letter Press wrote to the credit union, asked Press to the pay off the loan. "Due to the turmoil in the automobile industry and uncertainty surrounding our ownership, my request for a bonus payment was denied," Press wrote in a Nov. 11, 2008, letter on Chrysler letterhead. "I am attempting to arrange for a loan against my future bonus with my employer which would allow me to pay this loan off." Press also wrote that he had asked for loans from two banks and attempted to re-finance his home in order to pay off the debt, but was unsuccessful. After that request, Press was given additional time to pay $609,286 he owed the credit union, but made only one payment of $203,000. Press's home is now for sale, according to an online listing posted by a local Sotheby's Internation Realty agency. The asking price for the 6-bedroom, 6-bath "New England style" home is $3.2 million, according to the listing. A call the real estate agent was not immediately returned.

Note greets Sacramento T.G.I. Friday's customers: Restaurant is closed - (www.sacbee.com) Ten T.G.I Friday's restaurant locations in Sacramento and the Pacific Northwest were closed over the weekend, the latest in the persistent toll of business ills blamed on the economy. On Sunday, a sign taped to the inside of the T.G.I. Friday's on Howe Avenue apologized for the "inconvenience this is causing our valued customers." It called the closure temporary. While the note was unsigned, the franchise operation was the second to close in recent days. Last week, 70 Jack in the Box restaurants in Central California were closed as the local franchisee, Kobra Associates Inc., filed for bankruptcy protection in U.S Bankruptcy Court for the Eastern District of California. The Jack in the Box restaurant re-opened Friday afternoon. At the T.G.I. Friday's on Howe, would-be customers were parking their cars in the adjacent parking lot in hope of buying lunch. "Everything keeps closing," said an exasperated Michael Burakowski of Sacramento once he realized the restaurant was not open for business. "We are not getting better." The note posted on entry doors referred customers to a telephone number for more information. A telephone call yielded a voice recording explaining that the "unprecedented downturn in the economy ... has raised insurmountable challenges in keeping up with our corporate and other financial obligations." The recording noted further that the franchisee had worked for more than nine months to resolve differences with T.G.I. Friday's corporate office with no satisfactory resolution."We are committed to exploring alternatives that will allow us to reopen in the very near future," the unidentified representative said in the recorded message.

OTHER STORIES:

Homeowners who 'strategically default' on loans a growing problem - (www.latimes.com) Who is more likely to walk away from a house and a mortgage -- a person with super-prime credit scores or someone with lower scores?

Foreign currency investing: Now may be the time - (www.latimes.com) If you've been trying to find a place to invest your money and are feeling uneasy with U.S. stocks and bonds, consider looking overseas.

Feds plan to tinker with mortgage interest reporting - (www.latimes.com) Taxpayer problems in complying with the rules are legendary. Homeowners might have to answer up to seven questions just to determine if their mortgage...

Before a divorce, separate your finances - (www.latimes.com) Dear Liz: My wife and I each had excellent credit when we married 10 years ago. We are now divorcing (amicably). Since we married, we have...

California gas prices are high for profit's sake - (www.latimes.com) Re: "Gasoline keeps rising in state," Sept. 15:

Wilmington struggling with slowdown at ports - (www.latimes.com) Just two years ago, Jack McLaren and Eddie Ortiz were part-time dockworkers riding a tsunami of international trade that allowed them to work as...

Fed not acting like there's a recovery - (cnn.money.com)

Obama adviser blasts big business ads - (cnn.money.com)

Why more women don't get MBAs - (cnn.money.com)

Why no subprime perp walks? - (cnn.money.com)

You're $2 trillion wealthier - (cnn.money.com)

Recession buster: When workers take charge - (cnn.money.com)

A new way to stop bullets - (cnn.money.com)

U.S. bolsters mortgage insurance agency - (cnn.money.com)

Unemployed - without a lifeline - (cnn.money.com)

Saturday October 3 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

Owner of 70 Jack in the Box restaurants seeks bankruptcy protection - (www.sacbee.com) An already financially troubled Roseville real estate developer who owns 70 Jack in the Box restaurants from Fresno to Redding filed for bankruptcy protection Friday. Abe Alizadeh of Kobra Associates Inc., who owns and operates the restaurants, signaled trouble on Thursday when he suddenly closed them all, including six in Sacramento, temporarily stranding as many as 2,100 employees. The restaurants just as abruptly reopened Friday afternoon, but under protection from creditors with a Chapter 11 petition filed in U.S. Bankruptcy Court for the Eastern District of California. Alizadeh, whose company owes $1.5 million in back state taxes and whose restaurant business has liens from the state against it, could not be reached for comment Friday. "Our focus in the days ahead will be to return to normal business operations and to work cooperatively with our creditors to complete this process as quickly as possible," Alizadeh said in a written statement. "We apologize to our customers and our employees for the disruption in service, deeply appreciate their patience and are eager to resume fulfilling our commitment to them." The company had reached an impasse with creditors, which is why it sought protection in Chapter 11, the statement said, adding that the firm is talking to possible lenders. Jack in the Box corporate representatives were caught off-guard by the shutdown but were relieved when the stores reopened so quickly, said Brian Luscomb, a spokesman for the San Diego-based chain. "We're happy about that," he said, declining to discuss the bankruptcy court action. Alizadeh's restaurants are in virtually every town and city in Northern California. He is not the only Jack in the Box franchisee in Sacramento, however. Eleven local Jack in the Boxes are either owned by the corporate parent or other franchisees. But in some smaller cities, such as Galt and Woodland, the company's only presence is Alizadeh's restaurants. Another of Alizadeh's companies, Kobra Properties Inc., a real estate development firm, has been in Chapter 11 bankruptcy protection since November, staving off a $277 million debt. Among the largest creditors listed in court papers filed on Friday were an insurance company, utilities and the Jack in the Box corporation. Alizadeh, who started with the chain as a college student making tacos, is one of 90 franchisees who own 42 percent of Jack in the Box's 2,200 restaurants, Luscomb said. Alizadeh is not the largest owner among the 90, although the typical franchisee owns 10 restaurants, he said.

Low expectations for new loan help program - (www.sacbee.com) Dial back the pie-in-the-sky projections. Last month, the Obama administration launched a program to help homeowners with loans insured by the Federal Housing Administration. About 850,000 FHA borrowers are behind on their payments or in foreclosure, yet the program will assist just 45,000. The effort targets homeowners who were ineligible for the government's other loan modification plans. But the decision not to rescue more FHA homeowners reflects the Obama administration's need to protect the financial health of the agency, and to set more realistic goals for helping borrowers as its other loan modification programs fall short. On Friday, the FHA said its financial reserves had sunk below mandatory levels for the first time in its 75-year history. While officials insist the agency won't require a taxpayer rescue, falling home prices, rising unemployment and shady lenders continue to drive up default rates. Nationwide, about 17 percent of FHA borrowers have missed at least one payment or in foreclosure, compared with 13 percent for all loans, according to the Mortgage Bankers Association. The FHA said it will raise the financial requirements for lenders and request annual audits, and it is cracking down on lenders suspected of fraud. But the agency's powers to modify more loans for distressed borrowers are being weakened by the poor economy. FHA borrowers are concentrated in states like Michigan and Ohio, where job losses, rather than lax lending practices, are the main problem. And officials are weeding out borrowers who have too much debt. "Stretching too far, not only risks taxpayer funds and greater losses than we would otherwise have ... it also is not good for those homeowners," said Shaun Donovan, President Barack Obama's housing secretary. The new steps reflect the increasing dominance and vulnerability of the FHA. About 20 percent of new loans today are insured by the FHA, up from as low as 2 percent during the subprime loan boom. Lou Tisler, executive director or Neighborhood Housing Services of Greater Cleveland, says FHA loans accounted for one in four of the foreclosures handled by his nonprofit in the 12 months that ended in June. That's up from about one in five the year before. Many of those homeowners have lost their jobs and drained their savings and retirement accounts. Now they're out of options. Lorrin Montag and his wife, Dianna, are fearful about their future. Their unemployment and disability benefits run out next year, and the couple's one-story manufactured home in Corona, Calif. is worth around $150,000, far short of their $280,000 FHA loan.

Ron Paul's End the Fed on Amazon: #1 in Economy, #1 in Government, #10 in all books, #2 in Non-Fiction (Behind Glenn Beck - Ack!) - (www.amazon.com) Keep up the good work, Ron Paul!!! Kill the fed, and get rid of the corruption with the Central Bank (owned by the banks) as the watchdog allows banks and investment companies to manage themselves and the US Government.

Debtor's Revolt Makes the Huffington Post - (www.huffingtonpost.com) For years, Ann Minch of Red Bluff, Calif., has carried a balance of several thousand dollars on her Bank of America credit card, making minimum monthly payments of about $130, sometimes paying an extra $50 or $100. She says she's never missed a payment. Bank of America rewarded her loyalty this year by repeatedly raising her interest rate, which reached 30 percent in July. Fed up, the 46-year-old stepmother of two turned to YouTube. "There comes a time when a person must be willing to sacrifice in order to take a stand for what's right," said Minch in a Sept. 8 webcam video. "Now, this is one of those times, and if I'm successful this will be the proverbial first shot fired in an American debtors' revolution against the usury and plunder perpetrated by the banking elite, the Federal Reserve and the federal government." Minch announced that she'd be dumping Bank of America, refusing to pay off her credit card debt unless she was offered a lower rate. She explained that she'd been a reliable customer even though she'd lost her job as a mental health case manager. She said bank reps refused to negotiate her interest rate when she called them to complain a few weeks ago. "You are evil, thieving bastards," she said in her video. "Stick that in your bailout pipe and smoke it." The video made a splash online, getting links from all kinds of venues and garnering over 96,000 views as of Monday morning. Minch told the Huffington Post she fulfilled part of her threat on Saturday, when she went to her local BofA branch and closed out her checking and savings accounts. She took her money (around $5,000, she said) and put in a local community bank. She brought printouts of web pages that had linked to her video, but a manager wasn't interested in looking at them.

Peter Schiff Announces Senate Bid: Video & Letter - (www.dailypaul.com) Dear Friend, Well, it looks like you have made a difference. Based upon the unbelievable support that I have received from 10,000 supporters like you, I have decided to throw my hat into the ring to challenge Chris Dodd for the honor of representing the state of Connecticut in the United States Senate. I will announce my candidacy on MSNBC's Morning Joe show on Thursday, September 17 at 8:15am eastern time. Sorry for the short notice, but its important to honor commitments and keep these things under raps until the day the news breaks. At this time last year I could not have imagined that that I would be making such an announcement today. I had never intended to become a candidate for public office. But these are extraordinary times. Our economy is falling apart in front of our eyes and Washington seems intent on making the wheels come off even faster. At a time when we desperately need adult supervison, the economically illiterate are running the show. As I love my country, it now seems clear that I must try to do something to help. The emotional and material support I have received from across the country has made the decision much easier. So today it begins. As I'm sure you are aware, the rules in politics bear only scant resemblance to those which govern polite society. As a result, I am wading into strange waters, and I'm sure strange things will happen. But I promise to maintain my composure and give it my best shot. Based on the support that I have received thus far, I fully expect to be facing down Chris Dodd in the general election just 14 months from now. As my campaign takes flight, I appreciate the patience and trust that you have shown. To commit time and money to a long shot candidate for high office is a hard choice. I hope to repay that trust with a first class campaign. I look forward to your feedback and your continued support. Thanks again, Peter Schiff

Already hobbled by recession, ACORN gets slammed by scandal - (www.latimes.com) No new clients are being signed up as the group scales back or shuts down in many cities. An internal investigation is underway. Stung by the recession and a string of scandals, the ACORN community activist organization has been shutting down in many of the communities it once worked to empower. No new clients are being signed up, said national spokesman Brian Kettenring, while the group conducts an internal investigation into how its business is conducted. The Assn. of Community Organizations for Reform Now had already shuttered 40% of its centers -- in cities including Chicago, Salt Lake City, Atlanta and Omaha -- since its high of 105 offices two years ago, he said. The branches helped low- and middle-income clients with housing, jobs and navigating government aid programs. Kettenring said that the closures were mostly due to the poor economy and had become more frequent in the last year. "We're seeing the same challenges the entire nonprofit sector is seeing," he said. But former ACORN members say the scandals that have recently dogged the organization -- including allegations of mismanagement and voter registration fraud -- have been a bigger problem. In the latest controversy, ACORN workers in several cities, including New York, Baltimore and Washington, were secretly videotaped giving advice to two conservative activists who posed as a prostitute and her pimp and said that they wanted to buy a house and run it as a brothel with teenage girls. Workers were recorded giving advice on how to evade taxes and conceal the nature of their business. The appearance of the videos last week on a Fox News program set off a furor. The U.S. House voted this week to deny all federal funds for ACORN, while state lawmakers in California, Georgia and Minnesota called for investigations or a cutoff of state funds. "When you have this big of a mess, it takes time to clean up and your funders drop like flies," said Madeline Talbott, a former head organizer for ACORN's operations in Illinois.
ACORN's Chicago office closed in January 2008, when Talbott -- along with 365 community members, the local ACORN board and at least a dozen paid staff members -- quit over concerns about mismanagement and a lack of financial transparency at the group's national headquarters. "I feel so torn about what's happening now," said Talbott, who today is an organizer with Action Now, an advocacy group for the poor in Chicago.

California's unemployment rate hits 12.2% in August - (www.latimes.com) California's jobless rate set a fresh postwar high in August, rising to 12.2% from 11.9% in July and putting more pressure on the state's tattered unemployment insurance fund. Though the state may be in the early stages of an economic rebound, the latest figures underscore what many economists fear: There is no obvious engine of job growth to put California's more than 2.2 million unemployed residents back to work quickly. There was some encouraging news in the job figures released Friday by the state Employment Development Department. The pace of payroll job losses has slowed dramatically. California employers slashed a net 12,300 jobs last month. That's down from 39,000 jobs lost in July and the average of more than 70,000 jobs shed monthly during the first half of the year. Still, the sheer number of Californians out of work -- and the lengthening duration of their joblessness -- is worrisome to economists and public officials. Nearly 30% of the state's unemployed have been out of work at least 27 weeks. California's unemployment rate is well above the national rate of 9.7%. And it's the fourth-highest in the nation; only Michigan, Nevada and Rhode Island, at 15.2%, 13.2% and 12.8%, respectively, are faring worse. Unemployment will not decline until industries such as renewable energy, healthcare and construction experience significant growth, economists say. Most don't expect that any time soon.

OTHER STORIES:

Paul's HR 1207 - Audit the Fed Bill Officially Hits 290 Cosponsors - (www.dailypaul.com)
Working Class Zero - (www.nytimes.com)
Bank failure toll reaches 94 - (money.cnn.com)

Now the Fed wants to tame risk. Puh-leeze - (money.cnn.com)

U.S. bolsters mortgage insurance agency - (money.cnn.com)

"A corporation, after all, is not endowed by its creator with inalienable rights." - Justice Ruth Bader Ginsburg - (online.wsj.com)
David Korten: Who Really Crashed the Economy? And why do we keep blaming the wrong people? - (www.yesmagazine.org)
Uncle Sam Bets the House on Mortgages - (online.wsj.com)
Bill O'Reilly Backs Public Option (Just don't call it that) - (www.dailypaul.com)
Obama adviser blasts big business ads - (money.cnn.com)

Why no subprime perp walks? - (money.cnn.com)

Ron Paul's End the Fed Hits #2 on Amazon Non-Fiction List (Behind Glenn Beck - Ack!)
Recession buster: When workers take charge - (money.cnn.com)

Unemployed -- without a lifeline - (money.cnn.com)

Auto baron hit his own bump in the road - (money.cnn.com)

Corporate Corruption Killing America - (www.informationclearinghouse.info)
Video: Stephen Colbert on Corporate Personhood - (www.dailypaul.com)
If you like importing oil from Saudi Arabia, you’re going to love importing solar panels from China. - (www.nytimes.com)
Karl Denninger: Deflationary Collapse Dead Ahead - (www.321gold.com)
No Money? Then Make Your Own - (news.bbc.co.uk)

Friday October 2 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

Economic growth of Bush era was largely an illusion - (www.nytimes.com) It is sadly predictable that in a recession, the poor get poorer and the middle class loses ground. But even a downturn as deep and prolonged as this one cannot fully account for the desperate straits of so many Americans. The Census Bureau reported last week that the nation’s poverty rate rose to 13.2 percent in 2008, the highest level since 1997 and a significant increase from 12.5 percent in 2007. That means that some 40 million people in this country are living below the poverty line, defined as an income of $22,205 for a family of four. The middle class also took a major hit. Median household income fell in 2008 to $50,300 from $52,200 in 2007. That is the steepest year-to-year drop since the government began keeping track four decades ago; adjusted for inflation, median income was lower in 2008 than in 1998 and every year since then. Clearly, the recession has been brutal. But even before the recession, far too many Americans were already living far too close to the edge. As is now painfully evident, the economic growth of the Bush era was largely an illusion. Poverty worsened during most of the boom years and middle-class pay stagnated, as most gains flowed to the top. In a recent update of their groundbreaking series on income trends, the economists Thomas Piketty and Emmanuel Saez found that from 2002 to 2007, the top 1 percent of households — those making more than $400,000 a year — received two-thirds of the nation’s total income gains, their largest share of the spoils since the 1920s. Because many if not most Americans gained little to nothing from the Bush “growth” years, they have found themselves especially vulnerable to the recession. Federal stimulus spending has helped cushion the blow. The question going forward is whether an economic recovery, when it comes, will help the poor and middle class or whether the top-heavy favoritism of the previous expansion will reassert itself. The answer depends on how policy makers foster and manage a recovery. Economic growth alone does not guarantee job growth. Congress and the Obama administration must extend certain components of the stimulus package until employment does revive, including unemployment benefits, food stamps, tax breaks for working families with children and fiscal aid to states. Policy makers must also resist the reassuring but false notion that renewed economic growth can, by itself, raise living standards broadly. Government policies are needed to ensure that growth is shared. Reforming health care so that illness is not bankrupting — for families or for the federal budget — would be a major step in the right direction. The administration has also said that it would let the Bush-era tax cuts for the rich expire as scheduled at the end of 2010. More progressive taxation needs to be accompanied by more progressive spending, on public education and on job training and job creation. Support for unions and enforcement of labor standards would also help to ensure that in the next economic expansion, a fair share of profits would find its way into wages.

California disability applicant arrested after video shows her bowling‎ - (www.sacbee.com) A state worker who applied for a disability pension claiming that anxiety, chronic pain, and fatigue left her virtually unable to leave home or lift a coffee cup to her lips has been arrested after she was videotaped bowling in Elk Grove. Lisa Trevino-Angelo, 38, was arrested without fanfare and charged by the Sacramento County District Attorney's Office on Aug. 8. She will be arraigned Thursday. The former Department of Motor Vehicles personnel specialist faces a misdemeanor count of filing a false claim and one count of making false statements and submitting false information to get benefits from the California Public Employees' Retirement System, court documents show. Trevino-Angelo did not return calls to her home, but her attorney Michael Wise said she's innocent. "She has a legitimate medical condition," Wise said. "She's not trying to steal anything from anybody." Brad Pacheco, a CalPERS spokesman, declined to comment because the case is in the courts but said criminal charges are rare in disability frauds. "Most are handled administratively," Pacheco said. A CalPERS investigation report stapled to Trevino-Angelo's arrest warrant says she applied for a disability pension in July 2008 after working part time at DMV since 2001…… Her health deteriorated, and she stopped working altogether in 2007, the CalPERS report states. When Trevino-Angelo applied for the disability pension, she complained of chronic, debilitating "head-to-toe pain" that impaired her memory and made it hard for her to focus or work, medical reports show. When she underwent independent medical evaluations in December and January, the woman told doctors that her fibromyalgia and other ailments left her so weak that she couldn't hold a pen or her baby, cradle a phone to her neck or lift a coffee cup. She told doctors she felt like "a hostage in her own home" because anxiety and depression made it hard to leave it. When members of CalPERS investigations unit caught up with Trevino-Angelo in December 2008, she was videotaped bowling and eating pizza at Strikes Bowling Alley in Elk Grove. They also videotaped her shopping "in high energy fashion" at Target, Old Navy and Barnes & Noble, carrying bags, a CalPERS report states. CalPERS investigators also videotaped Trevino-Angelo chasing and lifting a toddler in and out of an SUV, and chatting on a cell phone. One video shows her jumping up at a soccer game "to celebrate some achievement by kids on the field," CalPERS report states. After reviewing her disability application, medical reports that Trevino-Angelo's doctors submitted, and almost four hours of video surveillance, two independent physicians questioned her disability claim. The doctors concluded she exaggerated her symptoms. Dr. Patricia Wiggins added that there were no limits on job duties Trevino-Angelo could perform.

Fight looms on credit for house buyers - (www.msnbc.msn.com) When Congress passed an $8,000 tax credit for first-time home buyers last winter, it was intended as a dose of shock therapy during a crisis. Now the question is becoming whether the housing market can function without it. As many as 40 percent of all home buyers this year will qualify for the credit. It is on track to cost the government $15 billion, more than twice the amount that was projected when Congress passed the stimulus bill in February. In the view of the real estate industry and some economists, all that money is well spent. They contend the credit is doing what it was meant to do, encouraging a recovery in the housing market that is gathering steam. Analysts say the credit is directly responsible for several hundred thousand home sales. Skeptics argue that most of the money is going to people who would have bought a home anyway. And they contend that unless it is allowed to expire on schedule in late November, the tax credit is likely to become one more expensive government program that refuses to die. The real estate industry, including the powerful 1.1 million-member National Association of Realtors, wants Congress to extend the credit at least through next summer. The group hopes to expand the program to $15,000 and to allow all buyers, not just those who have been out of the market for at least three years, to qualify. The price tag on that plan: $50 billion to $100 billion. ‘A no-brainer’: Joseph and Chassity Myers are among the two million buyers eligible for the credit this year. The newlyweds heard they could get money from the government for something they were tempted to do anyway. “It was a no-brainer,” said Mr. Myers, a commercial underwriter. “Owning something is the American family dream.” The couple bought a two-bedroom condominium here in the spring for $171,000 and amended their 2008 taxes immediately, receiving their windfall by direct deposit a few weeks later. Their home is now a monument to the government’s generosity. They bought a leather couch, a kitchen table, a bed, television stand, china cabinet, kitchen table, coffee table, grill and patio set. “We did exactly what the government wanted us to do,” said Ms. Myers, a third grade teacher. “We stimulated the economy.”

More Crap Legislation Passed: House Passes Two FHA Reform Measures in Voice Votes - (www.dsnews.com) The House of Representatives passed two housing measures this week designed to assist certain borrowers of Federal Housing Administration loans, earning kudos from some of the nation’s largest trade groups in the mortgage and housing industries. The 21st Century FHA Housing Act, approved late Tuesday night, would beef up the FHA on a number of administrative fronts, while the FHA Multifamily Loan Limit Adjustment Act passed Wednesday is designed to make FHA loans more accessible to borrowers in urban multi-family housing projects. “Passage of these two bills is further indication that the House is playing a proactive role in helping people who are being impacted by the current turbulence in the housing market,” David G. Kittle, chairman of the Mortgage Bankers Association , said Wednesday in a press statement. The National Association of Home Builders and the National Association of Realtors also expressed support for the bills. The Housing Act, a Democratic initiative sponsored by House Financial Services Committee Member Jon Adler (D.-New Jersey), gives current HUD Secretary Shaun Donovan broader power to appoint officers and set their pay rates; review and act on market-wide delinquency data; and fund technology updates on the FHA’s aging information systems. The bill passed on a voice vote. “Providing more resources for staffing and technology at FHA will allow that agency to continue to play its critical role in helping borrowers,” Kittle said of the bill’s provisions. “FHA needs to be able to hire and retain top quality staff and utilize 21st century technology if it is going to meet the growing demand for its products.” Also passed by a voice vote, the Loan Limit Adjustment Act was introduced by three Democratic representatives from urban districts: Anthony Weiner of New York, Peter Miller of California and Barney Frank – the House Financial Services Committee’s chairman – of Massachusetts. It Increases the maximum mortgage amount limitations under the FHA mortgage-insurance programs for housing projects with elevators and for extremely high-cost areas. The House’s GOP minority had dragged its feet on the measures. “Some Members may be concerned that H.R. 3527 would authorize the Secretary of HUD to increase FHA’s insurance coverage amounts which would increase the exposure to taxpayers,” the House Republicans wrote of the bill on their Web site. Kittle disagreed, however, calling the bill “an important step to growing this country’s supply of affordable rental housing in urban areas.” “The increased limits will make it possible for developers to obtain financing to build and rehabilitate high-rise housing,” he said.

For all Obama's talk, US has failed to wind in Wall Street - (www.guardian.co.uk) With a blank cheque from taxpayers and no real reform the perverse incentives for risk-taking are bigger than ever. What went wrong? Have the right lessons been learned? Could it happen again? The anniversary of the Lehman Brothers' bankruptcy and the freezing of the credit markets that followed is an occasion for reflection. I fear that our collective response has been mistaken and inadequate – that we may just have made matters worse. The financial sector would like us to believe that if only the Federal Reserve and the Treasury had leapt to the rescue of Lehmans all would have been fine. Sheer nonsense. Lehmans was not a cause but a consequence: a consequence of flawed lending practices, and of inadequate oversight by regulators. Financial markets had lent on the basis of a bubble – a bubble in large part of their making. They had incentive structures that encouraged excessive risk-taking and shortsighted behaviour. And that was no accident. It was the fruit of vigorous lobbying, which strived equally hard to prevent regulation of changes in the financial structure, new products like credit default swaps – which, while supposedly designed to manage risk, actually created it – and ingenious devices to exploit poor and uninformed borrowers and investors. The sector may not have made good economic investments, but its political investments paid off handsomely. Lehmans was allowed to fail, we were told at the time, because its failure did not pose systemic risk. The systemic consequences its failure entailed, of course, were used as an excuse for the massive bailouts for the banks. Thus the Lehmans example became at best a scare tactic; at worst it became an excuse, a tool, to extract as much as possible for the banks and the bankers that brought the world to the brink of economic ruin. Had more thought gone into how to deal with Lehmans, the Treasury and Fed might have realised that it played an important role in the shadow banking system, and that it was important to protect the integrity of the shadow system which had come to play such an important role in the US and global financial payments system. But many of Lehmans' activities had no systemic importance. The administration could have found a path between the false dichotomy of abandonment or bailout. That would have protected the payments system, providing the minimum amount of taxpayer money. Shareholders and long-term bondholders would have been wiped out before any public money had to be put in. Bailing out the US banks need not have meant bailing out the bankers, their shareholders, and bondholders. We could have kept the banks as ongoing institutions, even if we had played by the ordinary rules of capitalism which say that when a firm can't meet its obligations to creditors, the shareholders lose everything.

California's domestic violence shelters prepare for funding fight - (www.contracostatimes.com) California's domestic violence shelters, hit with a huge budget loss when Gov. Arnold Schwarzenegger cut all their state funding in July, pledged Tuesday to continue pressing for that money to be restored after a bill that would have done just that failed in the state Senate. Six of the state's 94 domestic violence shelters have closed since Schwarzenegger used a line-item veto July 28 to cut the $16.3 million California provided across the system, said Camille Hayes, a spokeswoman for The California Partnership to End Domestic Violence. SBX3 13, a bill by Sen. Leland Yee, D-San Francisco, passed through the Assembly by a wide margin before failing to get the votes needed in the Senate last week when Republican senators abstained from voting on all bills requiring a two-thirds majority to pass. "It feels that we've been defeated, but we haven't," said Carolyn Johnson, executive director of A Safe Place, Oakland's only domestic abuse shelter. "Our bill still has an opportunity to go back, and it will. So we know it's going to be a struggle, but we have not given up." Shelters are overwhelmed with a growing need for their services at the same time funding is disappearing, said Michelle Davis, director of development at Concord's STAND Against Domestic Violence advocacy group. "We're getting hit from both ends, and as we're struggling to provide services. The death toll continues to mount," Davis said. "We're now at 19 domestic-violence-related deaths in Contra Costa County from last August until now. That's about 500 percent above historical numbers. In a normal year we might have three deaths. We're partnering with everyone we can, but death toll tells us people are falling through the cracks." While some shelters are trying to make up for staff layoffs by recruiting volunteers, that comes with additional problems, Hayes said. "Volunteers don't enjoy confidentiality privileges and could be subpoenaed, so they can't provide the same kind of crisis counseling a staff member could," Hayes said. Niko Johnson, executive director of the Domestic Violence and Sexual Assault Coalition of Grass Valley, closed one of the program's six shelters in early August. "With the funding that was lost, about $207,000, we couldn't continue to keep the doors open," she said. "There are no longer any shelters in Western Nevada County. And in such a large geographic area, for women to leave their county with their children is virtually impossible because they're usually in situations with custody and can't take their children over county lines."

County's social services slashed by another $3 million - (www.contracostatimes.com) Contra Costa County supervisors on Tuesday cut more than $3 million from health care for AIDS patients, needy children and women trying to move off welfare and also voted to close the Chris Adams Center, a care facility for at-risk teenage girls at Juvenile Hall in Martinez. The cuts are due to a loss in state funding for the programs and come on top of about $20 million in health department budget cuts this year. The vote was unanimous. The board asked the county Family and Human Services Department to report back where the 17 girls at Chris Adams will be transferred and look into why referrals to the center from juvenile court declined, jeopardizing a plan to qualify it as a licensed group home. "We have been struggling to keep Chris Adams open, but the choices have been taken out of our hands," Supervisor Mary Piepho said. Health Services Director William Walker told supervisors that it will be difficult to reopen the home once it closes, given the difficulty of raising the money for it in the first place. Girls at Chris Adams receive extensive mental health treatment, including group psychotherapy and anger management training. The AIDS prevention and support cutback will reduce by half the county's mobile HIV testing. An in-home nursing program that serves 28 AIDS patients will be eliminated and the number of patients in a program that helps them with routine tasks, such as paying bills, will be slashed from 180 to 90. The board also took away $400,000 from a program aimed at reducing infant mortality and birth-related diseases in African-American children. A mental health and drug treatment program for women moving from welfare to work will also take about a 40 percent cut, from $1.7 million to $1 million. In addition, seven health department jobs were eliminated, two of them vacant positions

OTHER STORIES:

Lehman collapse: winners from the financial crisis - (www.telegraph.co.uk) For a lucky few, Lehman Brothers' bankruptcy on September 15, 2008, meant an opportunity. Below are a list of people, companies and places which have gained fame and fortune on the back of the "end of capitalism".

US Cracks Down on Two Mortgage Companies - (www.cnbc.com)

Housing Recovery Falters With Waning Govt. Stimulus - (www.cnbc.com)

Corporate Corruption Killing America - (www.informationclearinghouse.info)

Is your bank underwater? Check its debt level here - (www.msnbc.msn.com)

The Recession's Racial Divid - (www.nytimes.com)

Carter Sees Racism in Wilson's Outburst - (www.nytimes.com)

Media Notice Race Elephant in the Room - (www.miller-mccune.com)

Gold Jumps to 18-Month High As Dollar Slides - (www.cnbc.com)

Faber Report: Vivendi Likely to Sell Stake in NBC - (www.cnbc.com)

Kauai highest in foreclosure rate - (www.starbulletin.com)

Smaller is better in new housing market - (www.cantonrep.com)

Renters rejoice - (www.bendbulletin.com)

First Sale of Toxic Assets by FDIC Takes Place - (www.cnbc.com)

Experts Sound Off on Health Care Reform - (www.cnbc.com)

End the Fed, Save the Dollar: Ron Paul - (www.cnbc.com)

Niche Banks Fight Back at Tighter Regulation - (www.cnbc.com)

Where are the subprime perp walks? - (www.money.cnn.com)

FBI mortgage fraud probes grow to 2,600 cases - (www.reuters.com)

Economist debunks standard investment advice - (www.money.cnn.com)