http://www.latimes.com/news/local/la-me-budget-deficit18-2009nov18,0,7647152.story

"California faces a projected deficit of $21 billion
The legislative budget analyst's projection, to be released Wednesday, threatens to send Sacramento back into gridlock and force more broad cuts to state programs."

"Reporting from Sacramento - Less than four months after California leaders stitched together a patchwork budget, a projected deficit of nearly $21 billion already looms over Sacramento, according to a report to be released today by the chief budget analyst."

"California's finances have been so bad that the governor's finance director, Mike Genest, told a budget forum in Washington last week that back in February he had combed through the U.S. Constitution to research whether California could legally declare bankruptcy -- or revert to some kind of territorial status. (Neither was realistic, he determined.)

The state's financial problems predate the current recession and the gimmicks used to paper over the deficit, experts say. Year in and year out, state government spends roughly $10 billion more than it collects in tax revenue. "

http://online.wsj.com/article/SB10001424052748703683804574533602303700212.html?mod=WSJ_hps_sections_personalfinance

"States Turn to 'Millionaire's Tax'

States hungry for revenue are turning to taxpayers to make up the shortfall as they deplete rainy-day and economic-stimulus funds. To avert a popular revolt, many are resorting to a so-called millionaire's tax, which puts the burden on a smaller group of the very well-heeled."

"For the rich in California, the question can be "do you really need to live in this state when you have a state next door that has a zero income-tax rate?" said Don Weigandt, a wealth adviser in the Los Angeles office of J.P. Morgan Private Bank. That next-door neighbor is Nevada."

"The policy of raising state rates on the rich has failed before.

Through the early 1990s, several states maintained double-digit income-tax rates, but eventually brought them down partly because legislators realized they were driving out entrepreneurs. To keep good talent, create jobs and drive economic growth, state tax systems had to be competitive with their neighbors."

http://online.wsj.com/article/SB125729703390626817.html?mod=WSJ_hps_LEFTWhatsNews

"Fears of a New Bubble as Cash Pours In
Real-Estate, Stock and Currency Markets, Especially in Asia and Pacific, Are Seen at Risk

By ALEX FRANGOS and BOB DAVIS

Concerns are mounting that efforts by governments and central banks to stoke a recovery will create a nasty side effect: asset bubbles in real-estate, stock and currency markets, especially in Asia.

The World Bank warned Tuesday that the sudden reappearance of billions of dollars in investment capital in East Asia is "raising concerns about asset price bubbles" in equity markets across Asia and in real estate in China, Hong Kong, Singapore and Vietnam."

"Prices are surging across a host of markets. Gold, up about 44% this year, soared to a record high Tuesday. Copper is up about 50% in the past year."

""This is the beginning of another big and excessive run-up in asset prices," said Simon Johnson, a former IMF chief economist."

http://online.wsj.com/article/SB125193614108781629.html#mod=article-outset-box

"Pot 'Plantations' on the Rise
Border Crackdown Makes Farming in U.S. Forests Attractive; Cartel Links Suspected

By STEPHANIE SIMON

Marijuana growers, many believed to be affiliated with Mexican drug cartels, are aggressively expanding their illegal farming operations in the U.S., clearing land to plant pot in dozens of national forests from coast to coast."

"With the expansion comes an increased risk to campers and hikers -- a particular concern this Labor Day weekend, as families converge on public land just as many cannabis crops are ready for harvest."

"The pot farms are not fly-by-night operations. Growers cut down trees and terrace canyons to create plantations big enough for tens of thousands of plants. They apply pesticides and herbicides -- some not approved for U.S. use. They dam or divert streams and hook together miles of PVC piping to build irrigation systems, some rigged to sophisticated timers.

Each camp is typically tended around the clock by guards who may be equipped with assault rifles, night-vision goggles, walkie-talkies and radios to monitor law-enforcement chatter."

Back up your hard drives people.

I implore you.

I take no joy out of having to tell you that your hard drive is toast, and that maybe if you're lucky I can get something off without major surgery.

How many days have you gone without backing up your desktop? Your laptop?

Go to Best Buy, plunk down $130 for a 1 TB drive, and back it up, NOW.

http://www.city-journal.org/2009/eon0212wo.html

"WALTER OLSON
The New Book Banning
Children’s books burn, courtesy of the federal government.
12 February 2009

It’s hard to believe, but true: under a law Congress passed last year aimed at regulating hazards in children’s products, the federal government has now advised that children’s books published before 1985 should not be considered safe and may in many cases be unlawful to sell or distribute. Merchants, thrift stores, and booksellers may be at risk if they sell older volumes, or even give them away, without first subjecting them to testing—at prohibitive expense. Many used-book sellers, consignment stores, Goodwill outlets, and the like have accordingly begun to refuse new donations of pre-1985 volumes, yank existing ones off their shelves, and in some cases discard them en masse."

"Since the law became effective the very next day, there was no time to waste in putting this advice into practice. A commenter at Etsy, the large handicrafts and vintage-goods site, observed how things worked at one store:

I just came back from my local thrift store with tears in my eyes! I watched as boxes and boxes of children’s books were thrown into the garbage! Today was the deadline and I just can’t believe it! Every book they had on the shelves prior to 1985 was destroyed! I managed to grab a 1967 edition of “The Outsiders” from the top of the box, but so many!

( read on... )

As readers of 1984 may note, you cannot rewrite history without first destroying historical evidence that contradicts your version of events. By forcing the destruction of physical items subject to the first-sale doctrine, Congress has created a brighter future for those who wish to forget that people could actually own, buy, sell, trade, and lend books, in order to usher in a future where every man, woman, and child must pay a licensing fee per view.

http://online.wsj.com/article/SB124786612839159989.html

"Using the Lottery Effect to Make People Save
By JASON ZWEIG"

..."psychologists have long known that people tend to overestimate the odds of rare events. Applying that behavioral insight, finance professor Peter Tufano of Harvard Business School has devised a clever program called "Save to Win." Launched earlier this year for members of eight credit unions in Michigan, it is a cross between a certificate of deposit and a raffle ticket. Members who put $25 or more into a Save to Win one-year CD are entered into a monthly "savings raffle" for prizes up to $400, plus one annual drawing for a $100,000 jackpot. Only Michigan residents are eligible to participate.

This unusual CD is federally guaranteed by the National Credit Union Administration and pays between 1% and 1.5% annual interest, a bit lower than conventional rates. In 25 weeks, the program has attracted about $3.1 million in new deposits, often from people who have never been able to set money aside."

http://www.latimes.com/business/la-fi-caljobs18-2009jul18,0,6076386.story

"California unemployment rate rises to 11.6%

The state lost 66,500 jobs in June and has shed 766,300 jobs in the last year.
By Alana Semuels
7:58 AM PDT, July 17, 2009

California's unemployment rate inched up in June, reaching 11.6%, up 4.5 percentage points from a year earlier. It was one of 38 states reporting higher unemployment rates in June, the Bureau of Labor Statistics reported today. The state lost 66,500 jobs last month, and has shed 766,300 jobs in the last year."

"Last month, California had the sixth-highest unemployment rate in the nation, after Michigan, Rhode Island, Oregon, South Carolina and Nevada. Michigan's 15.2% unemployment rate was the highest since West Virginia broke the 15.0% mark in March of 1984, according to the Bureau of Labor Statistics."

http://bloomberg.com/apps/news?pid=20601202&sid=aM.7Dg3Z_msI

"Obese Exposed as Swine Flu Collides With Fat Epidemic

By Jason Gale

July 10 (Bloomberg) -- An unexpected characteristic has emerged among many swine flu victims who become severely ill: They are fat.

Doctors tracking the pandemic say they see a pattern in hospital reports from Glasgow to Melbourne and from Santiago to New York. People infected with the bug who have a body mass index greater than 40, deemed morbidly obese, suffer respiratory complications that are harder to treat and can be fatal."

http://online.wsj.com/article/SB124708992267013929.html

"Job Market Is Flashing Many Warning Signs
By MARK GONGLOFF

Investors would like to take comfort in the conventional view that unemployment is a lagging indicator -- that stocks can recover even if employment doesn't.

But that view focuses too much on the unemployment rate and not on other job-market gauges. It also ignores evidence that this recession may simply defy history."

"Claims apparently peaked in late March at 674,000, suggesting the recession should end any second now. But claims typically fall fairly sharply after peaking. Instead, they have hovered above 600,000 for an unprecedented 22 consecutive weeks.

The behavior of claims suggests a rousing economic recovery isn't yet on the way. That view is bolstered by two other forward-looking labor gauges -- the employment of temporary workers and hours in the average workweek -- which are still worsening, offering little hint of relief."

http://online.wsj.com/article/SB124701848135809721.html

"Apartment Vacancy Rate Hits 22-Year High

By NICK TIMIRAOS

The vacancy rate for U.S. apartments hit a 22-year high in the second quarter as rising unemployment reduced demand during what is usually the peak leasing season."

"Vacancy levels nationally rose to 7.5% in the April-to-June period, up from 6.1% a year earlier, according to Reis Inc., a New York real-estate research firm. Of the 79 markets tracked by Reis, 45 showed an increase in vacancies."

"Poorer-than-expected rental growth could push landlords who piled on debt during the years of easy credit into default on their mortgages."


For reference, past data on the LA rental market:

http://www.tierraproperties.com/current_market_data/metro_la_apt_vacancy_chart.htm

http://online.wsj.com/article/SB124700934928208517.html

"Fear Takes a Toll as Stocks Tumble

By E.S. BROWNING

After more than three months of greed, fear is returning to global financial markets.

Amid growing nervousness about the economy's prospects, the Dow Jones Industrial Average fell 161.27 points, or 1.94%, on Tuesday, to 8163.60, its lowest close since April 28. It still is up almost 25% since beginning a sharp rebound from a 12-year low on March 9, but it had been up as much as 34% a month ago."

"After the market bottomed March 9, investors increasingly embraced risky assets, bidding up stocks, especially those of smaller companies with little or no profit. They bought commodities such as oil, which doubled from its low earlier this year. And they sold the assets they had been hoarding in the previous rocky months, in particular the U.S. dollar and Treasury bonds.

But in recent weeks, as worries about economic weakness grew, some investors have sold risky assets and fled to safer ones. Oil and other industrial commodities have pulled back, as Treasury-bond prices and the dollar have rebounded."

http://online.wsj.com/article/SB124648274812182537.html

"Strapped States Play for Time as Fiscal Year Starts
Many Face Big Cuts in Programs and Staff as Lawmakers Haggle Over Budgets; California Lays Plans to Issue IOUs to Creditors

By STU WOO and SABRINA SHANKMAN

California's top accountant said the state would begin issuing IOUs to hundreds of thousands of creditors after lawmakers failed to meet its deadline this week to close a massive budget deficit.

Seven states failed to enact budgets before their new fiscal year, including Illinois, where Gov. Pat Quinn issued a veto. California Controller John Chiang said Wednesday he planned to send out $3.4 billion of IOUs in July to state contractors and local governments, as well as to residents expecting income-tax refunds, welfare grants and college scholarships."

"Mr. Chiang said without IOUs, the state would run out of cash by the end of July. "It's our last official step prior to defaulting," he said. Mr. Chiang delayed similar payments in February because of another cash-flow emergency, but didn't issue IOUs at that time."


http://www.latimes.com/news/local/la-me-california-budget2-2009jul02,0,4522104.story

"State IOUs loom as foes' battle lines harden

Budget hopes fade and officials prepare to issue scrip to creditors. The governor calls lawmakers' inaction on the budget 'inexcusable' and orders a special emergency session of the Legislature.

By Michael Rothfeld and Shane Goldmacher

Reporting from Sacramento -- After trying for weeks to fix a state budget gone out of control, Gov. Arnold Schwarzenegger and state lawmakers stood frozen in conflict Wednesday with the state at the brink of a meltdown."

"Chiang was set to print 28,742 IOUs starting at 2 p.m., said Garin Casaleggio, a spokesman for the controller. The initial warrants, which total $53.3 million, will go primarily to people who are expecting state income-tax refunds. The state last issued IOUs in 1992."

"The governor and lawmakers appeared resigned that they could no longer avoid the IOUs. A panel of finance officials will meet today to determine the interest rate for banks and other financial institutions that accept the IOUs. Some banks have already agreed to honor them, including Bank of America, which will accept the scrip until July 10. Other banks have not decided."


http://www.sco.ca.gov/5935.html

"Frequently Asked Questions about Registered Warrants (IOUs)"

"7. What happens if my financial institution will not accept the registered warrant?
You may decide to open an account at another financial institution that will accept registered warrants, or you will have to hold the warrant until it matures on October 1, 2009."

"19. Will the State pay for any overdraft or late payment that occurs because I was issued a registered warrant and unable to redeem it for a period of time?
No."


http://www.freerepublic.com/focus/f-news/2283551/posts

"California’s IOUs may be difficult to cash in
Reuters Blogs ^ | 1 July 2009 | Agnes Crane
Posted on July 1, 2009 1:40:50 PM PDT by The Pack Knight"

"The controller expects to send out $3.36 billion IOUs this month alone, if the state can’t fix its finances. And there will be plenty more to come in August and September, when the cash shortfall is projected at $3.7 billion and $6.5 billion, respectively.

But there is a catch. California will stamp an Oct. 1 maturity date on the IOUs, but will only redeem them if there is sufficient cash available."

http://www.cnn.com/2009/POLITICS/06/16/health.care.hearing/index.html

"Robin Beaton found out last June she had an aggressive form of breast cancer and needed surgery -- immediately.

Robin Beaton, 59, found out just days before her mastectomy that her insurance provider would not cover the procedure."

"The reason? In May 2008, Beaton had visited a dermatologist for acne. A word written on her chart was interpreted to mean precancerous, so the insurance company decided to launch an investigation into her medical history.

Beaton's dermatologist begged her insurance provider to go ahead with the surgery.

"He said, 'This is a misunderstanding. This is not precancerous. All she has is acne.' ... He said ,'Please don't hold up her cancer surgery for this,' " Beaton, 59, said as she testified at a House subcommittee hearing on the terminations of individual health policies by insurance companies."

It's well known that medical insurers cherry pick the healthiest and statistically least likely to need medical attention. But rescinding coverage on the eve of a pre-approved procedure is just plain evil.

Just a warning that a flashy website and pitches about leveraging the synergy of international collaboration and cheap labor should never be taken as anything other than window dressing...


http://www.seattlepi.com/xconomy/405758_xconomy22472.html

"According to the U.S. Attorney's office in Seattle, Minecode CEO Pradyumna Samal ordered a Minecode employee to send computer commands that completely deleted a customer's website, e-mail server, and its customer database in retaliation over a contract dispute. Vinado, an e-commerce wine-seller, had hired Minecode to develop a "virtual gift shop" for its website. The cyberspace sabotage cost Vinado more than $115,000 and forced the company out of business."


http://www.goodgearguide.com.au/article/301590/ceo_sentenced_trashing_client_web_site

"The CEO of a Seattle-area consulting company was sentenced to three months of home confinement Thursday for destroying a client's Web site following a contract dispute.

Minecode CEO Pradyumna Samal will also serve 288 hours of community service and three years of probation, the U.S. Department of Justice said Thursday.

A project manager with the company, Sandeep Verma, got a one-year probation sentence and was ordered to perform 40 hours of community service."

"Minecode, of Bellevue, Washington, had built the online gift shop for wine retailer Vinado, but things soured in late 2006. According to the Department of Justice, things got so bad between the two companies that Samal ordered Verma to disable Vinado's online gift shop.

The next month Samal "caused commands to be transmitted to Vinado's Web site that resulted in the deletion of Vinado's Web site, e-mail server and database in its entirety," the DoJ said."

"Vinado went out of business and its owners lost their home following the incident, the DoJ said, citing a victim impact statement by Vinado partner Seth Micarelli."

Sometimes you ask yourself a question, and you can't go to sleep until you figure out an answer.

Assume a normal 10oz can of "compressed air". It's a can filled with diflouroethane, under sufficient pressure that most of the can is liquid at room temperature.( Read more... )

http://perens.com/works/articles/MorganHill/

"A Cyber-Attack on an American City

Bruce Perens

Just after midnight on Thursday, April 9, unidentified attackers climbed down four manholes serving the Northern California city of Morgan Hill and cut eight fiber cables in what appears to have been an organized attack on the electronic infrastructure of an American city. Its implications, though startling, have gone almost un-reported.

That attack demonstrated a severe fault in American infrastructure: its centralization. The city of Morgan Hill and parts of three counties lost 911 service, cellular mobile telephone communications, land-line telephone, DSL internet and private networks, central station fire and burglar alarms, ATMs, credit card terminals, and monitoring of critical utilities. In addition, resources that should not have failed, like the local hospital's internal computer network, proved to be dependent on external resources, leaving the hospital with a "paper system" for the day."


There's a reason redundancy exists, even if it's expensive. It's because in a worst case scenario, not having that redundancy will blow any cost savings you might have realized out the window.

The sales tax for California went up by 1% on April 1st. The following links to a table of sales tax rates by county:

http://www.boe.ca.gov/news/pdf/l212b.pdf

For Los Angeles:

LOS ANGELES CO. 9.25%
City of Avalon 9.75%
City of El Monte* 9.75%
City of Inglewood 9.75%
Pico Rivera* 10.25%
City of South Gate 10.25%

There has been confusion over the actual tax rate here in LA County. Currently, it is 9.25%. However, due to the passage of Measure R, sales tax is slated to increase to increase by half a percent to 9.75%, effective July of 2009. (See http://www.metro.net/measurer/faqs.htm - at the time Measure R was proposed, the increase would have added a half cent to the then 8.25% LA County sales tax.) Note that the cities in LA County with a sales tax rate greater than 9.25% will also see their tax rate increase by a half-precent.

This means that doubling tax for tip when dining in the City of LA will mean roughly a 19% tip.

http://online.wsj.com/article/SB123836516806167317.html#mod=testMod

"Inflation Is Tempting for Indebted Nations
Because Rising Prices Can Ease Debt, Letting Them Climb Has Appeal to Governments Digging Deep for Stimulus Spending"

"The pressure of the debt payments has the potential to alter policy makers' attitude toward inflation. Typically, central bankers seek at all costs to keep inflation in check, because they see it as an inequitable tax that erodes the buying power of a country's currency and people's savings.

But in a country with heavy debts -- households in the U.S. and the U.K. are the world's most indebted -- the equation changes: Inflation can reduce the burden, because the face value of bonds and mortgage debts stay the same, while things like nominal wages, tax revenues and house prices tend to rise."

In other words, if you can't tax your citizens to pay for outrageous borrowing, let inflation devalue your debt and tax your citizens that way.

There are small things that tell criminals that a neighborhood is safe to operate in. Broken windows that don't get fixed. Graffiti tags claiming territory that aren't immediately painted over. Neighbors who don't talk to each other. Overgrown lawns, abandoned and neglected buildings. It's generally understood that well kept neighborhoods are populated with people who care enough to call the cops if you decide to deal off a street corner, or start breaking into parked cars and garages.

It's the same way in the computer world. There's no point in attacking and compromising hosts that are actively being protected and patrolled when there's so much low hanging fruit out there. Home computers running XP Home, SP1, whose trial period antivirus software has long expired, connected directly to cable modems. Corporate networks where desktop firewalls are disabled by policy so that IT can use remote login software to make their lives easier when people call into the helpdesk, and where the user doesn't have the ability to run Windows Update, or install an alternative to Internet Explorer 6.

In the same way that a neighborhood that isn't well kept invites criminal activity, poorly maintained computer and computer networks become breeding grounds for botnets which are routinely used for theft of personal information, network attacks for ransom, and of course, spam.

How do you keep from becoming part of the problem?( Read more... )