All Detroit teachers could possibly be laid off if spending budget problems not resolved

All school administrators and teachers employed by the city of Detroit are being laid off. Starting July 29, no educator employed by the Motor City can have a job because of the deeply troubled finances of the city. A 3rd of Detroit is uninhabited, and individuals have been leaving in droves. Post resource – Severe budget problems could get all Detroit teachers laid off by MoneyBlogNewz.

Motor City schools $327 million in debt

The public school system in the city of Detroit, Mich., is so plagued by financial problems the city is being forced to lay off every single one of its teachers and school administrators, according to CNN. To raise over $230 million to stay alive through August of the year, the Detroit School District issued emergency bonds in March while continuing to have its $327 million deficit. Drastic measures were required since the district was able to raise half a year’s budget, although it was not enough. First on the firing line were staff salaries. The layoff notices are being given to all 5,714 teachers and school administrators in Detroit. July 29 could be the end of teachers in Detroit. The city will no longer be paying for it.

Nobody wants to stay

Detroit, once a sprawling metropolis and industrial powerhouse, has been losing people steadily for more than a decade. There are now the same numbers of individuals in Detroit as there was in 1910 as 25 percent of the population left in just the last 10 years. A third of the city, according to MSNBC, sits vacant. The school district has 10,000 fewer students than in 2001. In March, when the Detroit School District went into crisis mode, a law titled Public Act 4 was passed by the Michigan legislature that granted broad powers to emergency financial managers employed by state and local governments. Robert Bobb is the emergency financial manager for the public schools in Detroit. As an emergency measure, he is using the law now.

Firing may not happen

When it comes to layoffs, not every person will really be losing their jobs. Bobb, the emergency financial manager, is said to be restructuring Detroit schools in order to bring them in line with declining enrollment. However, he is also going to restructure the CBA that exists between the city and the Detroit Federation of Teachers. Bobb is likely trying to repeat what happened in 2009 when the district and union made an agreement to cut back on health benefits and teachers salaries. If the fiscal issues are not controlled, Detroit may have to deal with a state takeover, report Reuters. By 2015, the $155 million Detroit deficit might grow to $1.2 billion which would really start in 2014. Just like Bobb took over Detroit schools, an emergency manager might be assigned by the state to the city.

Citations

CNN

money.cnn.com/2011/04/15/news/economy/detroit_teachers/index.htm

MSNBC

msnbc.msn.com/id/42612424/ns/us_news-life/

Reuters

reuters.com/article/2011/04/12/us-detroit-budget-idUSTRE73B5GT20110412

Scheming barristers bungle up BP oil leak fund

The government of the U.S. directed BP to pony up $20 billion for an oil leak fund. A mere pittance of those mega billions has been dispersed to Gulf coast residents who say their livelihoods have been overturned by the environmental and economic carnage. People demanding recompense complain a lot about the claims process, which is infested with attorneys attracted to settlement money like flies on turds.

Getting through BP oil spill claims

About 19 percent of the $20 billion BP set aside for the oil leak claims was paid in the BP oil spill claims with $3.8 billion paid in total by the Gulf Coast Claims Facility a year after the Gulf of Mexico accident last year. The latest report from Kenneth Feinberg, who was appointed by the Obama administration to disburse the BP oil leak fund, said that 201,261 claims have been paid. There have been over 857,000 claims already. BP oil spill claims will be paid until August 2013 by the Gulf Coast Claims Facility which has 3,200 employees in its 35 offices in five states. The claims process has been considered unfair, slow and confusing by several people getting Feinberg a lot of criticism.

Damage proof

Feinberg made a statement on Tuesday about the BP oil spill fund management saying “Amounts requested by claimants very often bear no reasonable relationship to the damages really proven,” since $20 billion was requested by one applicant. About 72 percent of the claims from the BP oil spill have had payments or offers made. There have been claims denied too. There are pending claims also. Usually they just need some documentation. Figuring out the BP oil claims process has been hard on some of the individuals for instance fishermen. They are used to dealing in cash and without paperwork. In 574 cases disputed by claimants who believed payment was too low or rejection was unfair, the Coast Guard, charged with arbitrating disputes, hasn’t overturned a single one.

Getting the cash is all that matters

Tens of thousands of Gulf Coast residents — particularly vulnerable populations with language and culture disadvantages such as the region’s large contingent of Vietnamese fishermen — have been misled into signing up with lawyers or have been unaware that claims have been filed in their name. Feinberg spoke on the fraudulent activity. He said it was “an obstacle to the efficiency and speed in getting the checks out.” The New York Times states that several law firms have targeted Vietnamese fishermen to con them onto their client lists. When BP settles, lawyers end up with more money for how many clients are on the list. The New York Times states of a San Antonio law firm that filed claims for thousands of Vietnamese, all listed as deckhands with identical earnings. The claims were rejected, and many people were surprised to discover their names on the list.

Information from

CNN Money

money.cnn.com/2011/04/18/news/companies/BP _spill_claims/?npt=NP1

24/7 Wall Street

247wallst.com/2011/04/19/the-BP -20-billion-gulf-claims-facility-has-paid-nearly-nothing/

Los Angeles Times

latimes.com/news/nationworld/nation/la-na-gulf-spill-claims-20110419,0,2595018.story

New York Times

nytimes.com/2011/04/19/us/19spill.html?_r=1

Lansing says absolutely no to pay day advance lending as Michigan economy flails

If a legal business offers a product like pay day loans – a product for which there is a proven demand – the efforts of local governments to restrict payday loan lenders through cutthroat zoning policies are at best questionable, says the Payday Pundit. NWI.com reports the Lansing, Mich., Planning and Zoning Board are looking for ways to revise ordinances to phase bad credit loans out of town. Cutting legal, profitable, in-demand companies out of the picture is a poor choice, considering that Michigan’s HB 4214 is holding the financial martial law ax over every struggling town in the state. Source of article – Lansing says no to payday lending as Michigan economy flails by MoneyBlogNewz.

Changing ’special use’ provisions now

Lansing’s Planning and Zoning Board of Appeals has been poring over the city’s “special use” zoning provisions, ostensibly as a check-up to see if any changes need to be made. The suggestions that targeted payday lenders are not a coincidence. Bad credit loan companies help a city’s economy while helping those in need of a little boost here and there although it might help to talk about parking near churches in residential neighborhoods and making sure there are fewer in home day centers.

The zoning changes say that there cannot be any new payday advance outlets in Lansing although this is something that might end up leading to more issues in the future, some suggest. Trustee Mikal Stole said to NWI that they’re simply trying to encourage “more variety in the types of companies.

Several fighting

The state government would be able to “force a municipality” such as putting Lansing into bankruptcy with its “financial czar” (EFM) according to Detroit Rep. John Conyers while it is “an assault on democracy” according to AFL-CIO president Mark Gaffney. This is how Michigan House Bill 4214 has already caused some issues. A new Emergency Financial Manager will start to have control as the Benton Harbor, Mich., official’s powers have been superseded . The economy of the small town might be bad enough to warrant dissolution, a power HB 4214 grants to a governor-appointed EFM.

According to the Rachel Maddow Blog, Benton Harbor’s per capita income is $8,965, the lowest in Michigan. From Benton Harbor, you just have to cross the St. Joseph River to get a better number. The PCI is at $24, 949 in “Twin City” St. Joseph. This is significant because Benton Harbor is the home of the Whirlpool company, which is celebrating its 100th anniversary this year. The company is in St. Joseph, “on the other side of the tracks,” celebrating this.

The business staying at home is something the Benton Harbor business individuals would like. When it comes to payday advance, Lansing should be concerned about keeping its moneymakers around because a financial czar could possibly be waiting in the wings.

Information from

The Maddow Blog

maddowblog.msnbc.msn.com/_news/2011/04/18/6489195-whats-at-stake-in-benton-harbor

NWI Times

nwitimes.com/news/local/govt-and-politics/article_61f251e3-379e-5576-adde-8954a51e9131.html

Payday Pundit

paydaypundit.org/2011/04/18/too-prominent/

CFPB set to deliver easier mortgage forms to consumers

The Home Mortgage Disclosure Act of 1975 demands lenders to make all loan data clear to pertinent public parties. User-friend provisions like this have been around for over 30 years, yet the subprime debacle of recent years proves that the mortgage process still needs an excellent deal of work. Thus, the Consumer Financial Protection Bureau plans to take steps to simplify mortgage disclosure forms so that any prospective homebuyer can understand them. Source of article – CFPB to make simpler mortgage disclosure forms a priority by MoneyBlogNewz.

Calling the mortgage disclosure form a ‘key priority’

The Wall Street Journal reports that the new mortgage disclosure form is a “key priority” of the CFPB, a Dodd-Frank organization that will start operations on July 21.

There’s a lot of paper documentation in detail of the mortgage agreement with all of the mortgage forms. Closing the loan costs a lot in fees and costs. There are a lot of provisions as well. The 1968 Truth in Lending Act and Real Estate Settlement Act from 1974 were put together with these forms. Mortgage disclosure forms will become friendlier than ever if the CFPB gets what it wants.

“We will be looking at our first (mortgage form) prototypes,” White House adviser and possible CFPB chairwoman Elizabeth Warren told Dow Jones Newswires.

In the past, this form has been opposed

The CFPB idea to simplify the forms was being reviewed by Elizabeth Warren with supports. In the past, there have been several attempts to simplify the mortgage papers to help customers understand the exact costs with mortgage loans. This never worked in the past. The CFPB post can be filled by somebody who might make an effort to help Warren. What the decision is on changes to the credit card industry will be determined in the future.

Citations

Home Mortgage Disclosure Act

ffiec.gov/hmda/

Wall Street Journal

blogs.wsj.com/developments/2011/04/18/warren-new-prototype-for-mortgage-forms-coming-in-may/?mod=google_news_blog

You should understand your mortgage

youtube.com/watch?v=MC515DJrhsM

Student loan debt expected to hit $1 trillion and beyond this year

student loan debt is increasing commensurate with a greater number of students paying higher tuition. Students borrowing money for college have racked up a higher amount of debt than those individuals who have financed any number of things in life with charge cards. In fact, the amount of money individuals while students have borrowed to finance education and its relevant accessories is about to blow by $1 trillion and gain momentum into the future. Student loans, long considered a “good debt,” may morph into a bad debt for graduates faced with decades of student loan payments.

Tuition increases mean a rise in student loan debt

In 1993, less than half of students earning a bachelor’s degree graduated with student loan debt. That number increased to two-thirds by 2008. The average debt students left with in 2009 were $24,000. The total amount of student loan debt is supposed to get to at least $1 trillion in 2011. It is anticipated to continue to grow rapidly. Republicans in Congress want to cut Pell grants, a form of federal financial aid for lower-income students. The states are starting to cut college and university funding right now. Also, tuition is increases at most of these places which may hurt the current generation of college students quite a bit. There has been more than just an increase in student loan debt. Student loan default has also increased. When it comes to having kids in the future and purchasing homes, students may have troubles due to credit damage and the huge student loan payments. Anyone who has children may have to choose between paying off their student loan d! ebt and saving for their children’s college education.

Debt does not have to be bad

Payday loans, credit cards and auto loans are all forms of “bad debt.” Student loans, on the other hand, are considered “good debt” by several. It is considered bad to take out any debt though, now that the recession is done. As long as the degree and salary from that degree are able to effortlessly pay back the debt, school loans are considered good debt even though the College Board explained a four year education is over $37,000 a year now. Most financial advisers suggest that individuals do not borrow more than they could make the year after they graduate. That rule of thumb, however, highlights the risk of taking on student loan debt. Finding a job that pays off the average cost of college with a degree in sociology or history is unlikely. The risk may be lower for fields such as engineering or medicine, however the costs, and the debt, will likely be higher.

Loans aren’t always the answer

The real thing that everybody ought to know when it comes to debt is that if it cannot be paid off, then it is bad debt. Students going to for-profit schools have default rates at about 50 percent currently. Student loans usually can’t be discharged in bankruptcy. Any student loans that are guaranteed by the government could be even worse for you. You will end up having tax refunds withheld, Social Security payments docked or even your wages garnished. The Obama administration did make it easier for student loan debtors stuck in low-paying jobs by forgiving the balance on debt for those who have dutifully paid 15 percent of their income toward their student loans for 25 years – or 10 years if they work in public service.

Information from

New York Times

nytimes.com/2011/04/12/education/12college.html?_r=1&emc=eta1

Creditcards.com

creditcards.com/credit-card-news/does-good-debt-still-exist-1264.php

care 2

care2.com/causes/education/blog/student-debt-for-college-likely-to-exceed-a-trillion-dollars/

Federal Reserve doesn't plan to stiffen credit supply just yet

The Federal Reserve has declared that it will not be securing the national credit supply yet. Part of the Fed’s duties, of which there are many, is to monitor the supply of available lending capital and altering it accordingly to best fit the needs of the economy as a whole. The central bank of the nation is being pressured to look into reigning in the credit supply, however insists it will not until the economy is in better shape.

Not a good enough economy to change credit

Food and gasoline is just a couple of the consumer goods that costs have increased on lately. Several have worried that inflation is going to start happening. Because of all of this change, many are worried about the Federal Reserve. They think the Federal Reserve should try restricting credit again. Members of the Fed, however, are confident that the overall economy is too shaky to tighten the credit supply, according to MSNBC. The interest rates will stay near zero still according to Fed Vice Chair Janet Yellen. She was speaking at Yale University when she said this.

Not a low enough joblessness

The interest rates charged by banks and the credit offered to the banks in the united states are partially controlled by the Fed. In order to stimulate lending, banks can get loans from the Fed at zero or close to zero interest during a recession. Those banks can lend that capital to consumers, as mortgages or personal installment loans, or to other financial institutions. There are more parts than credit to the Federal Reserve’s operations. Still, credit is probably the most essential. The amount of available capital may also be dropped by the Fed. This would only take place if it thought the price inflation was too much. There has been a huge increase in the price of oil and food. Now, a dollar does not mean as much.

CFPB watching banks too

The Federal Reserve is going to eventually restrict the supply of credit, meaning interest rates on loans will start increasing in the next year or so, once the central financial institution feels confident enough about unemployment and other economic conditions. Banks may also have to follow rules from the new Consumer Financial Protection Bureau, which will levy fines for legal violations. Elizabeth Warren is the spokesperson for the bureau who said there should be new rules put in place by 2012. Reuters states that July is when the bureau will start to operate. The CFPB is nevertheless a hotly debated issue in Congress, so the extent of its reach has yet to be determined, however a greater degree of regulation is soon to set in for the financial system.

Information from

MSNBC

msnbc.msn.com/id/42520140/ns/business-eye_on_the_economy/

CNBC

cnbc.com/id/42532601

Reuters

reuters.com/article/2011/04/11/us-cfpb-warren-idUSTRE73A5FQ20110411

Jesse Jackson Jr. mistakes iPad for joblessness monster

Illinois Democratic congressman and iPad owner Jesse Jackson Jr. has turned on the machine he used to love. Only one month ago, Jackson lauded Apple’s groundbreaking tablet as a revolutionary educational tool. On Friday, however, iPad owner Jackson turned around and exclaimed before Congress that the iPad is a dangerous gadget that is “probably responsible for eliminating thousands of American careers,” states the Huffington Post.

Jackson states goodbye to publishing

Seeing the textbookless campuses growing and the bankrupt Border Books upset the Illinois junior congressman. He claims it is the iPad’s fault.

“What becomes of publishing companies and publishing company jobs?” Jackson asked the House. “What becomes of bookstores and librarians and all of the jobs associated with paper? Well, in the not-too-distant future, such jobs simply won’t exist.”

Jackson also objected to China being the primary production source of iPad parts.

“There is no protection for jobs here in America to ensure that the American people are being put to work.”

Americans are the ones that want it

The wealth that the iPad has had for many companies in the United States, not even Apple, has not been considered by Jackson, states Business Insider. MarketCues suggests that the iPad will prove to be the nexus from which numerous billion-dollar industries could conceivably spring. E-readers and the iPad provide publishers with myriad opportunities to create interactive textbooks while greatly reducing the costs of producing frequent new editions, a boon for students.

It was anticipated that traditional publishing was to change. According to @Craigmod, the evolution was needed. It might be more helpful to have electronic books to save on paper and give the books instantly. Reading books is what over 65 percent of iPad users use the iPad for. It also, according to Morgan Stanley, created more than $2 billion in revenue every quarter.

Tablet revolution

Unlike Jesse Jackson Jr., publishers are likely to have to adapt. More electronic books than print books are sold on Amazon currently, according 2010 figures. Similarly, iPad users also support periodicals. YUDU Media states that iPad users, in comparison to desktop computer browsers, will spend 30 times more time on sites such as Wired.com, VanityFair.com and GQ.com. There were more Wired.com iPad apps sold than Wired print editions. This is what late 2010 figures showed.

It is just like the commercial for the iPad. It claims, “It’s already a revolution, and it’s only just begun.” There is no longer an invitation for Jesse Jackson Jr.

Citations

@Craigmod

craigmod.com/journal/ipad_and_books/

The Hill

thehill.com/blogs/floor-action/house/148879-jackson-an-ipad-for-every-schoolchild

Huffington Post

huffingtonpost.com/2011/04/17/jesse-jackson-jr-ipad-unemployment_n_850227.html

Market Cues

marketcues.com/blog/2010/02/will-apples-ipad-impact-the-printing-and-publishing-industries/

Neiman Journalism Blog

niemanlab.org/2010/02/the-ipad-business-model-for-news-strategies-publishers-must-embrace/

Publishing Perspectives

publishingperspectives.com/2010/11/simba-releases-statistics-on-ipad-e-book-reading/

Real Clear Politics

realclearpolitics.com/video/2011/04/15/rep_jesse_jackson_jr_blames_the_ipad_for_killing_jobs.html

TSTC Publishing’s Book Business Blog

tstcpublishing.wordpress.com/2010/02/26/ipad%E2%80%99s-potential-impact-on-textbook-publishing/

YUDU Media

slideshare.net/yudu/the-apple-ipad-trends-and-statistics

Economies evolve, pontificators pontificate

youtube.com/watch?v=D5X8W7MgbhM

Home sales are low and rent is starting to rise

Often there is debate on whether to rent or to buy, and the cost of renting is going up. More people are electing to rent apartments, and vacancies have plummeted countrywide among rental properties. That presents landlords with a fantastic chance to charge more to new tenants, as the demand means the resource is scarcer.

Get the apartment rented with no problems

The number of rental property vacancies has been steadily falling for more than a year, according to Bloomberg. The occupancy rate is very high. The vacancy rate throughout the nation is only at 6.2 percent total. There’s a business called Reis Inc., which tracks real estate data throughout the nation. This company observed that there was an 8 percent vacancy rate in April 2010 which dropped to 6.6 percent by the time the year was over. More than likely, there is one age group taking up all the rental space, according to Reuters. This contains anyone from age 20 to 34. The amount of individuals needing a place to live isn’t going down. Nevertheless, people do not want to purchase yet. It could be very hard to find a new apartment now with all the vacancies continuing on.

Rent is rising

As fewer apartments and other rental properties are accessible, the cost of those properties goes up. There is also a rise in countrywide rent averages. The Reis Inc. survey also stated this. The national average effective rent, which is what people pay each month, is $991 per month, a rise over $967 a year ago. There was also an increase in the asking rent. It went up from $1,027 to $1,047 from a year ago. The actual rent went up $20 while asking rent went up $20. At this time, there are also fewer duplexes and apartment complexes being built. That signifies a higher rent in the future is very possible.

Americans don’t have to buy for any reason

Buying real estate is something Americans do not have incentive to do. Rates of interest and values are very low. Nevertheless, getting financing is harder than ever. CNN reports the Federal Reserve said 25 percent of applicants aren’t given loans while borrowers with a credit rating below 760 can’t be backed by Freddie and Fannie. Most banks are hoping for a 20 percent down payment on homes as well. This isn’t a simple thing for Americans to do.

Citations

Bloomberg

bloomberg.com/news/2011-04-06/apartment-vacancies-in-u-s-fall-to-three-year-low-as-rental-demand-climbs.html

Reuters

reuters.com/article/2011/04/06/us-usa-apartments-idUSTRE7353CD20110406

CNN

money.cnn.com/2011/04/06/real_estate/why_you_cant_get_a_mortgage/index.htm

Amazon Kindle to ship with ads on May 3

The traditional writing industry has lost ground to e-readers, tablets and other mobile devices, and Amazon is sitting quite with its Kindle platform. Currently, Amazon has a 60 percent market share in the e-reader market, a hold that should increase as the $114 Kindle with Special Offers hits the market next month. But there’s a caveat for people, states the Christian Science Monitor. The latest Kindle offering could be advertisement-supported. Source of article – Amazon to release ad-supported Kindle for $114 by MoneyBlogNewz.

Kindle price cut with advertisements

The price of the Amazon Kindle has fallen a few times since the first generation was introduced at $399 in 2007. To be able to try and compete with the iPad in the e-reader market, the advertisements were put on it this time in the price deduction. May 3 is when the kindle will start with Special Offers. The Kindle 3 will be put in stores then. Both Best Buy and Target will carry it.

Founder and CEO of Amazon Jeff Bezos state it is a “chicken in every pot” move. Every person will want the Special Offers $114 kindle:

“We’re working hard to make sure that anyone who wants a Kindle can afford one,” he said via a statement.

Reader response to a Christian Science Monitor article about the price cut seems to echo the fears most customers have about an advertisement-based Kindle. With 99 cent books, one reader would be okay as long as the ad based e-kindle was free. The price of books becomes a different issue then. Another reader concurs that a $25 discount is not enough to make up for the presence of ads, however one thing experts believe Amazon has done right is to isolate the ads to the Kindle’s screensaver and the bottom of the home screen.

“It’s very important that we didn’t interfere with the reading experience,” Kindle director Jay Marine told the Associated Press.

The price is needed

The guess TechCrunch has is that the $114 Amazon Kindle is just leading up to the Christmas 2011 $99 Kindle. According to traditional marketing, 99 is magical number.

This isn’t real anymore though according to research done at the New York Columbia Business School. The “dollar-minus” approach (down to 99 cents, for instance) was really less effective than “dollar-plus” price points (like $4.01), according to the Columbia study. Sales of goods that used the dollar-plus method increased by 3 percent, and customers felt greater trust for dollar-plus brands because the prices were perceived as being less manipulative.

Articles cited

Christian Science Monitor

csmonitor.com/Books/chapter-and-verse/2011/0413/Will-readers-accept-ads-in-exchange-for-a-cheaper-Kindle

Columbia Business School

gsb.columbia.edu/ideasatwork/researchbriefs/7314376?&top.region=main

Knowing and Making

knowingandmaking.com/2011/04/new-research-99-no-longer-optimal-for.html

TechCrunch

techcrunch.com/2011/04/11/amazon-kindle-99/

Kindle sales tripled after last price drop

youtu.be/PaAFm_fZQ2A

Executive payment soaring as wages flat line

CEO pay in the United States was up 12 percent in 2010, averaging about $9.6 million. In the final quarter of 2010 corporate profits grew faster than they have in over 60 years-30 percent. As CEOs get richer, the workers making them rich get poorer because the rising cost of food and gas is taking a bigger chunk out of stagnant wages. Post resource – CEO pay soars as flat middle class wages erode with inflation by MoneyBlogNewz.

CEO pay increases
coming from the hard workers

At a time when millions of Americans simply hope they keep their jobs, average CEO pay has risen to surpass pre-recession levels. Even as employment is increasing, employee pay is not, however CEO pay is. Over 13 million people are currently looking for work, yet CEO’s are getting by on what they already have and increasing their own wallets. There is no incentive to retain workers or entice new employees. CEOs from nearly every economic sector bailed out by taxpayers’ averaged 12 percent raises last year. Yet, private sector pay rose by about 2 percent. Joblessness hovered at 8.8 percent in March. Economist predicts the unemployment rate will continue to stay high for some time.

The CEO stock portfolio increases

The richest CEO of 2010 was Phillipe Dauman of Viacom, making in only nine months $84.5 million. The rising price of oil and gas has been good to Ray Irani of Occidental Petroleum, who was the runner up with $76.1 million, a 142 percent pay increase over 2009. The third highest paid CEO was Larry Ellison of Oracle bringing in a modest $39.5 million. Wall Street has made it so CEOs are making more money with stock choices than they have made since 2007. Several CEOs played the stock market well by taking stock options when they had no value, knowing the market would one day recover. CEOs are now cashing in on their stock opportunities and making the millions they anticipated. There was well over $20 million made by several CEOs cashing in their stock opportunities according to USA Today.

Middle class income his hard by commodity price increases

The huge CEO pay increases are hard to swallow for the American middle-class, who has watched income stagnate for a generation. In the last five months, income for U.S. hourly workers have not increased one penny, according to the Bureau of Labor Statistics. United States workers are not getting raises, yet the cost of products is ever increases. Prices of commodities and income are basically going in opposite directions. Gas costs alone eat up more than half the average worker’s wage increase. The average middle class employee buys about 12 gallons of gas a week alone. In 2010 it was about $40 cheaper per month to fill a gas tank. Yet the average weekly raise only increased by about $18.

Citations

New York Times

nytimes.com/2011/04/10/business/10comp.html?_r=2#38;ref=business

USA Today

usatoday.com/money/companies/management/2011-04-04-1Aoptions04_ST_N.htm

NPR

npr.org/2011/04/10/135272006/paychecks-cant-keep-up-with-rising-prices

Citi changes check clearing procedures to limit overdraft fees

Citi announced that it will clear checks differently, a move that could reduce excessive overdraft charges. Banks were forced to offer consumers a choice with overdraft protection on debit cards with financial reform. However, banks were allowed a loophole with checking accounts. {On Monday Citi said it will curtail the practice of milking overdraft fees from checking accounts by processing smaller checks first|By clearing checks written for smaller amounts first, Citi is keeping itself from stealing as much money as it has in the past with bogus fees|The lying, thieving bankers at Citi have chosen to restrain themselves from repeatedly charging overdraft fees by clearing smaller checks first|By clearing smaller checks first, Citi is essential taking from itself the chance to charge its consumers over and over for bounced checks. Resource for this article – Citi to give customers a break by clearing smallest checks first by MoneyBlogNewz|Citi is checking itself from charging repeat overdraft charges simply by letting smaller checks clear before a larger one sends the account into negative territory. Article resource –

Make sure to watch out for new bank rules

Debit card overdraft protection cost customers lots of money in 2009. A total of $20 billion was charged. Banks collected another $12 billion from overdraft fees on checking accounts. The FDIC feels like an opt-in requirement for banks on overdraft coverage is necessary even though the voluntary overdraft loan program for checking accounts was taken out of the financial reform. Consumers Union, the non-profit publisher of Consumer Reports, is urging the FDIC to require all banks to get consent before charging consumers for checking account coverage. Other charges will more than likely be added to banks such as Citi and Bank of America if the FDIC does this. Banks want the money still. The regulation will never be able to stop that.

Citations

Associated Press

finance.yahoo.com/news/Citi-to-start-clearing-apf-1510892963.html?x=0&sec=topStories&pos=main&asset=&ccode=

Consumer Reports

pressroom.consumerreports.org/pressroom/2010/11/consumer-reports-poll-only-22-percent-of-bank-customers-have-opted-in-for-debit-card-overdraft-protection.html

New York Times

nytimes.com/2010/03/10/your-money/credit-and-debit-cards/10overdraft.html?_r=1

Hackers attack Epsilon database, phishing spree expected

Epsilon, a major Internet marketing concern, last week experienced a hack of its client’s customer database. The data security breach at Epsilon put millions of customer names and addresses in the possession of cybercriminals. Customers of Epsilon clients started receiving warnings to expect phishing scams in their inboxes.

In the Epsilon database: Better watch out

The Epsilon database hack could be the biggest in history of a hack while millions of names and emails were stolen. Each year, about 40 billion marketing emails are sent out for 2,500 companies by Epsilon. The business announced that it was hacked on Friday, meaning emails and other information given to websites may have been stolen.

At least a dozen businesses were impacted. Consumers at banks such as Capital One, Barclays Bank, U.S. Bancorp, Citigroup, J.P. Morgan Chase have to be on the lookout for phishing attacks. Also, when you have been working with Best Buy, TiVo, Walgreens, Kroger or HSN, then you should watch out. Student email addresses from SAT organization, College Board, might have been stolen also for about 5,900 universities and colleges.

How to spot a phishing con

Spam is more than likely the goal of all the emails and names stolen out of the Epsilon database. Account holders can be targeted with this "phishing" scam, which may be very effective. Fake accounts are put together for the phishing emails. Then, the customer is certain to log in so the information can be stolen. Once hackers have a person’s name and email address, they might also discover personal details on Facebook that can be used to make the email more convincing. Phishing scams often ask consumers to update charge card information or urgently warn that if a response isn’t received the account can be closed. Sometimes the phishing con will say the account is compromised. They will say information needs to be updated because of this.

A new record for stealing data

Although Epsilon said the database hack was limited to consumer names and emails, the company hasn’t yet made clear how many consumers or students have been exposed. Epsilon clients already mentioned weren't the only ones at risk. AstraZeneca, Kraft Foods, Hilton Hotels and Verizon Communications might also be at risk. The biggest attack recognized in United States history for identity theft is currently the Heartland Payment Systems hack, which the Epsilon database hack may have surpassed. A 20 year prison sentence was given to cyber-criminal Albert Gonzalez. He got into the Heartland Payment Systems and stole over 40 million card numbers to use for his own personal use.

Information from

Associated Press

finance.yahoo.com/news/Banks-creditcard-issuers-warn-apf-754015157.html?x=0&sec=topStories&pos=main&asset=&ccode=

MSN Money

money.msn.com/identity-theft/news.aspx?feed=OBR&date=20110403&id=13261200

Computer world

computerworld.com/s/article/print/9215443/Update_Bank_customers_warned_after_breach_at_Epsilon_marketing_firm?taxonomyName=Security&taxonomyId=17

Microsoft

microsoft.com/security/online-privacy/phishing-symptoms.aspx

Release of discount window details reveals big European financial institution bailout

Because of the financial crisis, financial institutions in trouble cannot any longer fly under the radar to the Federal Reserve’s discount window. A Freedom of Information Act request for the details had kicked around the courts until last week. The Supreme Court ruled that the public has a right to know which banks obtained loans from the discount window and how much they borrowed. Just how bad the financial crisis got was made clear by the discount window data.

Financial institution bailout by Fed

The discount window was created by the Fed a century ago to help healthy banks caught in a cash crunch with short-term loans. The identities of the financial institutions borrowing have been kept a secret in the past due to the stigma that comes in financial circles when a financial institution needs help from the Fed. After Bloomberg and Fox Business filed a request under the Freedom of Information Act, the Fed was required to release the data though because of a Supreme Court ruling. Nobody was worried about the stigma anymore after the report was released Thurs by the Fed. This was because almost every bank in the world during the financial turmoil needed a bit of help. More than 25,000 pages of documents show the Fed lent as much as $110 billion through the discount window in one day as the financial crisis peaked.

Borrowing in Europe extreme

Through the financial turmoil, Wall Street banks got a lot of criticism for taking government bailout funds. The discount window banks were mostly European financial institutions though, the data showed. About $26.5 billion was borrowed by Belgian-French bank Dexia while $24.6 billion was borrowed by Dublin-based financial institution Depfa that German mortgage lender Hypo Real Estate owns on Oct. 29, 2008. There were other European financial institutions to get billions from the discount window. These included France's Societe Generale, Austria's Erste Group and Bank of Scotland. On this side of the pond, before it became the biggest financial institution failure in history, Washington Mutual borrowed $2 billion on Thursday, Sept. 18, 2008, to get through the weekend. The $2 billion loan could not be paid by Wamu Monday when it was due leaving the bank to keep taking out $2 billion overnight loans. This was until Thursday, September 25, 2008 when J.P. Morgan Chase ! took over.

U.S. not the only ones with a financial turmoil occurring

When the collapse of Lehman Brothers in September 2008 triggered the financial crisis, the global economy went into a tailspin, the financial system froze and banks worldwide begged the Fed for help. The release of the discount window data shows just how bad the damage was and how easily it spread. During testimony to a congressional panel investigating the financial turmoil in November 2009, Fed chairman Ben Bernanke said of all the financial institutions lined up at the discount window, only one was not at risk of total collapse. The Dodd-Frank financial reform bill passed in 2010 removes secrecy from discount window lending, however not until two years have passed from the time the loans are made — about the same period it took the courts to force the Fed to do it this time.

Information from

Fox Business

foxbusiness.com/industries/2011/03/31/demystifying-feds-secretive-discount-window/

Wall Street Journal

online.wsj.com/article/SB10001424052748703712504576234700412932330.html

Reuters

reuters.com/article/2011/03/31/usa-fed-lending-idUSN3126104220110331?pageNumber=2

Justices doubting Wal-Mart discrimination lawsuit warrants class action

A class action lawsuit seeks to extract billions from Wal-Mart over allegations of sex discrimination. The largest lawsuit ever linked to gender discrimination in the workplace was argued before the Supreme Court Tues. Doubts were raised about the likelihood of a class action proceeding against Wal-Mart after several justices questioned critical aspects of the lawsuit.

Wal-Mart lawsuit might affect all businesses

The rights of workers versus corporations can be looked at, likely by the Supreme Court, in the Wal-Mart sex discrimination suit. All corporations in the United States need to pay attention. It will impact nearly all of them. In the lawsuit, it claims that about 1.6 million female Wal-Mart employees, past and present, were treated unfairly. The women weren’t given as many opportunities for promotion while being paid less. The plaintiffs are demanding back pay and punitive damages. In the San Francisco Bay Area, a United States Court of Appeals court let the case proceed. It was one trial for a multiparty suit. The decision the Supreme Court has to make is if it is okay for these women to sue Wal-Mart together. In the group there are women that have worked at Wal-Mart since 1998.

Wal-Mart might lose a lot in the class action lawsuit

The sex discrimination suit turning to class-action might hurt Wal-Mart quite a bit. Wal-Mart might have to settle out of court if there is a ruling towards it. The plaintiffs may end up filing individual suits towards Wal-Mart if Wal-Mart's side is chosen which would, in the end, make it so Wal-Mart might win. The sex discrimination lawsuit towards Wal-Mart might change the business world. This has caused major U.S. corporations and employee advocates to follow it very closely. It is possible that workers might end up flooding the courts with lawsuits though. This would be what happens if the plaintiffs win. Corporations would be relieved if Wal-Mart were to win this one.

Arguments about the suit

During arguments over the Wal-Mart sex discrimination lawsuit Tues, the Supreme Court questioned whether systematic discrimination took place. The plaintiffs' attorney explained that women are affected by stereotypes due to the corporate culture. About 3,400 Wal-Mart and Sam's Club stores in the United States had this problem, he said. Wal-Mart counters that any discrimination concerning pay or treatment came from a few rogue managers and a class-action covering all female employees deprives the business of its legal rights. Justices questioned a key contention by the plaintiff’s lawyer, that Wal-Mart managers were allowed personal discretion to pay men more than women, seemed to contradict claims of systematic discrimination. June is when the decision could be made.

Articles cited

Los Angeles Times

latimes.com/news/sc-dc-walmart-discrimination-20110329,0,3119421.story

CNN

cnn.com/2011/US/03/29/scotus.wal.mart/index.html?npt=NP1

Associated Press

google.com/hostednews/ap/article/ALeqM5gbOXzrZv6IDB2xzX5jdDJegcXkug?docId=879cbb4c18b44a338291cb69015c93db

Even conservatives' think balanced spending budget amendment is a poor choice

GOP senators are proposing a well balanced budget amendment to score political points for 2012. Forcing the federal government into default by refusing to allow the debt ceiling to be raised is the consequence the GOP senators are suggesting if they are not allowed to bring their balanced budget amendment to a vote. Individuals who are informed about spending budget matters do not take the Republican political stunt seriously, considering it is fiscally reckless and has zero chance of becoming part of the United States Constitution.

GOP turns record surplus into record debt

A well balanced spending budget amendment bill is one that over a dozen senators are sustaining. John Cornyn of Texas and Utah's Orrin Hatch wrote the bill together. Congressional Republicans tried to pass a balanced budget amendment during the Clinton Administration in 1992, 1995 and 1997, although Clinton's 1993 deficit reduction package resulted in a $5.6 trillion government surplus by 2001 as projected by the Congressional Spending budget Office. Republicans quit pushing a well balanced spending budget amendment when Bush took office in 2001. By the fall of 2008 when the financial crisis got to its worse, the federal debt had reached $10 trillion because of the Republican Congress and Bush pushing for spending more on tax cuts and wars.

Idea of well balanced spending budget being well known

Now the balanced spending budget amendment has come back. It is being pushed. Having Congress vote on this amendment that will never pass is just political theater, suggests Cornyn even. Cornyn told the right wing site Human Events that "Voters would then know, with very stark clarity, which is for a balanced budget and who is not, and it could have a big impact on the 2012 elections." Republicans are attempting to use blackmail to get this bill passed in congress. In exchange for allowing the federal debt ceiling to exceed its current $14.2 trillion cap, which a fragile global economic recovery depends on, Republicans are demanding that Congress vote on a well balanced spending budget amendment.

Support is limited for amendment

Tax hikes are prohibited in the balanced spending budget amendment, which is just one of the many things integrated. The GOP proposed this bill during the last time Clinton was in office. Robert Rubin, Clinton's Treasury Secretary, said that if this were to occur, it would turn out to be much worse than a recession. The American Enterprise Institute is a conservative group. It said that the most irresponsible action imaginable," is the well balanced budget amendment. The Center on spending budget and Policy is very liberal. It said the amendment would take away necessary benefits for instance joblessness. Since 1788 when the United States Constitution was ratified, there was a reason there have only been 27 amendments to make it. two thirds of the House and Senate must vote yes, then legislatures from at least 38 states must do the same.

Articles cited

CNN Money

money.cnn.com/2011/03/29/news/economy/balanced_budget_amendment/?cnn=yes

Perrspectives

perrspectives.com/blog/archives/001775.htm

Investors.com

investors.com/NewsAndAnalysis/Article/567387/201103281851/Budget-Balance-By-Law.htm