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STORIES:
Police
Chief’s $204,000 Pension Shows How Cities Crashed - (www.bloomberg.com) Stockton, California, Police Chief
Tom Morris was supposed to bring stability to law enforcement when he was appointed to
the job four years ago. He lasted eight months and left the now-bankrupt city
at age 52 with an annual pension that pays more than $204,000 -- the third of
four chiefs who stayed in the position for less than three years and retired
with an average of 92 percent of their final salaries. Stockton, which filed
for bankruptcy protection on
June 28, is among California cities from the Mexican border to the San Francisco Bay confronting rising
pension costs as they contend with growing unemployment and declining property-
and sales-tax revenue. The pensions are the consequence of decisions made when
stock markets were soaring, technology money flooded the state, and retirement
funds were running surpluses.
Hospital Chain Investigation Found Dubious Cardiac Work - (www.nytimes.com) In the summer of 2010, a troubling letter reached the chief ethics
officer of the hospital giant HCA, written by a former nurse at one of the
company’s hospitals in Florida. In a follow-up interview, the nurse said a
doctor at the Lawnwood Regional Medical Center, in the small coastal city of
Fort Pierce, had been performing heart procedures on patients who did not need
them, putting their lives at risk. “It bothered me,” the nurse, C. T.
Tomlinson, said in a telephone interview. “I’m a registered nurse. I care about
my patients.”
Standard Chartered may lose NY license over Iran ties - (www.reuters.com) In a rare move, New York's top bank regulator threatened to strip the
state banking license of Standard Chartered Plc, saying it was a "rogue
institution" that hid $250 billion in transactions tied to Iran, in
violation of U.S. law. The New York State Department of Financial Services
(DFS) on Monday said the British bank "schemed" with the Iranian
government and hid from law-enforcement officials some 60,000 secret
transactions to generate hundreds of millions of dollars in fees over nearly 10
years.
Social Security's Era of 'Free Money' Comes to an End - (www.cnbc.com) People
retiring today are part of the first generation of workers who have paid more
in Social Security taxes during their careers than they will receive in
benefits after they retire. It’s a historic shift that will only get worse for
future retirees, according to an analysis by The Associated Press. Previous
generations got a much better bargain, mainly because payroll taxes were very
low when Social Security was enacted in the 1930s and remained so for decades.
Knight Blowup Shows How High-Speed Traders Outrace Rules -
(www.bloomberg.com) The U.S. has
the most sophisticated financial markets in the world, yet they can
unaccountably spin out of control at a moment’s notice. The latest case
involves Knight Capital Group Inc. (KCG),
a securities-trading company in Jersey City, New Jersey, that was laid low by one of its
inadequately tested computer-trading programs. In less than an hour on Aug. 1,
the program entered incorrect bids for about 150 stocks into the interconnected
electronic marketplace. Computer programs at other firms sniffed out the errors
and traded against Knight. By the end of the day, the company was out $440
million, forcing it to seek outside financing to survive. This debacle
highlights a market weakness that regulators have been unable to address
because high-frequency trading has raced ahead of the humans who try to contain
the mischief it can cause. Industry resistance to improved regulation hasn’t
helped.
