Daily Digest 3/26 - Pension Burden For Local Entities, Anger At Goldman Simmers, Japan Down To One Nuclear Reactor
- Monroe County taxpayers' pension tab for 2013: $173 million
- Pension burden for local entitities
- Fitch: U.S. Student Loan ABS Resistant to Default Rates
- E-Mail to Corzine Said Transfer Was Not Customer Money
- Anger at Goldman Still Simmers
- U.S. and Turkey to Step Up ‘Nonlethal’ Aid to Rebels in Syria
- Japan Down To One Nuclear Reactor
- Several Reasons Why Gasoline Prices are so High
Pension costs for local governments and agencies in New York are expected to skyrocket 59 percent in 2013 compared to last year as officials warn that recent reforms will provide no immediate relief to the mounting expense.
Pension burden for local entitities (New York) (Saxplayer00o1)
More than 3,400 entities provide public pensions in New York state, and data obtained from the Comptroller's Office shows a staggering increase in their current and future cost for retirees. Everything from the local library to major medical centers are being whacked by the rising pension costs. The database below shows all of the entities in each county that pick up the tab for taxpayer-funded pensions -- and how the costs are soaring. Costs for 2011 and 2012 are based on annual invoices from February of that year. Costs for 2012 are projections.
Fitch: U.S. Student Loan ABS Resistant to Default Rates (Saxplayer00o1)
The Federal Reserve Bank of New York recently reported that as many as 27% of all student loan borrowers are more than 30 days past due. Recent estimates mark outstanding student loans at $900 billion- $1 trillion. Fitch believes that the recent increase in past-due and defaulted student loans presents a risk to investors in private student loan ABS, but not those in ABS trusts backed by FFELP loans. Several macroeconomic factors are putting pressure on student loan borrowers. The main ones are unemployment and underemployment. The Bureau of Labor Statistics estimates the current unemployment rate for people 20 to 24 years old at nearly 14% and for those 25 to 34 years old, 8.7%. Underemployment is difficult to measure for these demographics, but it is likely having a negative impact.
But the e-mail, a copy of which was reviewed by The New York Times, did not capture the full story behind the wire, which turned out to contain customer money. MF Global employees in Chicago had first transferred $200 million from a customer account to the firm’s house account, people briefed on the matter said. Once it was in the firm’s coffers, the people said, Chicago employees then promptly transferred $175 million of the money to the MF Global account at JPMorgan in London — the account that was overdrawn.
Anger at Goldman Still Simmers (jdargis)
Copper River relied on Goldman to handle its negative bets, known as short sales, in compliance with securities laws. These regulations require that before a short sale can be made, the shares must be borrowed; Mr. Cohodes said his fund had paid Goldman approximately $100 million to borrow shares over many years.
In another sign of Turkey’s soured relations with Syria, the Turkish Foreign Ministry on Monday formally announced the withdrawal of Turkish diplomats from Damascus, the Syrian capital, and closure of its embassy there. Turkey, once one of Syria’s friendliest neighbors, had raised the possibility in recent weeks that it would close the embassy. It joins a number of other nations, including the United States, members of the European Union and the Arab League, to have taken similar steps that deepen the diplomatic isolation of President Bashar al-Assad.
Japan Down To One Nuclear Reactor (guardia)
The vast utility's entire stock of 17 reactors are now idle, including three units that suffered a meltdown when the tsunami hit Fukushima, as Japan warily eyes a spike in electricity demand over the hot and humid summer. Only one of Japan's 54 units – in northernmost Hokkaido – is still working, and that is scheduled to be shut down for maintenance work in May.
Prices are also whipsawed by uncertainty over potential supply disruptions, due to drilling accidents and warfare in Nigeria; disputes in Syria, Yemen and Israeli-Palestinian territories; erroneous reports of a pipeline explosion in Saudi Arabia; concern about attacks on Middle East oil pipelines and processing centres; and new Western sanctions on Iran over its nuclear program and the mullahs’ threats to close the Straits of Hormuz.
Article suggestions for the Daily Digest can be sent to dd@PeakProsperity.com. All suggestions are filtered by the Daily Digest team and preference is given to those that are in alignment with the message of the Crash Course and the "3 Es."