Daily Digest

Daily Digest 1/6 - Economic Temperature, Copper Prices Cause Theft Increase, Corn Rationing

Thursday, January 6, 2011, 11:00 AM
  • Increase In 'Fees' Rankles Georgians
  • Sanford Releases Proposed Spending Plan
  • UC Leaders Respond To Executive Pension Request
  • Tuesday's Economic Temperature - Too Hot or Just Right?
  • Race to Debase - 2010 Q4
  • Rise In Copper Prices Causes Increase In Theft
  • Weather, Supply and China to Dominate Grain Prices
  • Corn Rationing Needs to Begin

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Increase In 'Fees' Rankles Georgians

Opposition is growing against the increasing number of fees levied by the state that are supposed to pay for specific services but wind up in the general treasury.
Many critics say they're merely a tax increase dressed up to fool voters. 
The practice of taking user fee money to shore up the rest of the state budget started more than a decade ago but has accelerated in recent years as the state grapples with declining income from taxes on sales and income.
In the last session, the General Assembly raised dozens of fees to help plug a budget hole, from drivers licenses to court filing. With next year's budget projected to have a nearly $2 billion shortfall, observers predict the fee swap-out will continue.

Sanford Releases Proposed Spending Plan (S.C)

Gov. Mark Sanford released his final proposed state spending plan Tuesday, one that avoids cutting days from the school calendar as some lawmakers have suggested.
But all state employees earning more than $35,000 a year would take a 5 percent pay cut, doctors and hospitals would be paid less to treat patients in the state-run Medicaid program, and colleges and universities would have to cut $100 million from their budgets.
Sanford's proposed budget also would carve out $10 million in money for a new highway trooper class, additional money for job recruitment and $7.9 million to buy and preserve land. 
What impact Sanford's proposal will have on the state's looming budget debate is unknown. Legislators return to Columbia next week and will have to cut between $800 million and $1 billion from state spending for the year that starts July 1.

UC Leaders Respond To Executive Pension Request

University of California leaders today made their strongest statement yet in response to the revelation last week that 36 highly paid executives threatened to sue UC unless their pensions are increased....Under UC's current formula for calculating pensions an employee earning $400,000 a year who retires after 30 years would get a $183,750 annual pension. But if the cap were lifted, the pension rises to $300,000.

Tuesday's Economic Temperature - Too Hot or Just Right? (ilene)

What else do the top 1% want? They want commodity prices to rise. That may seem counter-intuitive as they should be input costs but, in practice, consumers are charged on a "mark-up" pricing system and companies make a percentage of profits on sales so, if input costs go up, they simply raise prices and rising prices mean rising profits as long as they avoid margin compression - that's why "slightly" rising commodities are preferred as sharp rises can cause dislocations in pricing.  

Race to Debase - 2010 Q4 (adam)

In US dollar terms gold was up 29.6% on the year.  Beginning the year at $1097, gold showed a steady pace reaching $1421 to close out the year. Silver absolutely dominated the field with a flurrying finish rounding out an 83% gain for the year. Amazing! Silver lapped four fiat currencies of the more than 75 we tracked in 2010. 

Rise In Copper Prices Causes Increase In Theft (Iowa)

While gold prices have skyrocketed, a less glamorous metal has also gone way up in price and become the target of thieves across the state. Copper, which is used in plumbing and wiring, is over four dollars a pound and Cedar Rapids police spokesperson Cristy Hamblin says thieves have been bold about stealing it.
“They know no boundaries, because in 2010 we’ve had just a very sharp, almost triple the amount, we’ve had 73 reported cases of copper theft,” Hamblin says. Copper thieves were brazen enough to cut part of the wiring at the Vineyard Church of Cedar Rapids while a church service was underway.


Weather, Supply and China to Dominate Grain Prices (dr boost)

With the increases in demand from China, supply concerns are only set to compound. "I saw the news over Christmas that China was raising interest rates. It was like the markets laughed at China and said, ‘whatever. We’re not afraid of the big bad wolf.’"   Much of the talk coming out the trading community right now is that commodities are the place to be, Grisafi says. With that, he expects to see speculative buying coming into the market early in 2011.

Corn Rationing Needs to Begin (dr boost)

Soaring corn prices will slice into demand, with corn exports expected to fall first followed by feed usage. Analysts anticipate the cattle industry to begin rationing earlier than other livestock sectors due to poor margins, but rationing in poultry, hog, and dairy will be close behind. "It will be very painful," Turner adds. USDA’s latest World Agricultural Supply and Demand Estimates (WASDE) put the carryout for the 2010-11 U.S. corn crop at 832 million bushels, less than half the previous year’s carryout of 1.7 billion bushels.

Article suggestions for the Daily Digest can be sent to [email protected]. 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."


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Re: Daily Digest 1/6 - Economic Temperature, Copper Prices ...

"U.S. states lost one-third of their revenue in 2009 as a result of the recession, the Washington Post reported, citing a Census Bureau report released yesterday.

Total state revenue fell almost 31 percent to $1.1 trillion in fiscal 2008-2009, the newspaper said.

The drop in revenue came from investment losses at state pension funds, a drop in income from taxes and increased demand for unemployment and other benefits, the newspaper reported. "

........................1A) US state revenue fell in '09, spending didn't: Census

"Wall Street economists, looking at recent seasonal spending and revenue trends, estimate the $14.3 trillion debt limit will be reached toward the end of March or sometime in April if Congress fails to raise it before then.

Hitting the limit could force shutdowns of federal offices, as happened in 1995, threaten payments for Social Security and other federal benefits, or even cause a default on federal debt payments.

"Bondholders don't like excitement. They like to be paid and do not like to read a lot of stories about possibly not getting paid," said Lawrence Dyer, head interest rate strategist at HSBC Securities in New York."

........................2A) Geithner says debt limit may be hit by March 31

"The delinquency rate on commercial mortgage-backed securities reached 9.2% in December, the highest on record, according to analytics firm Trepp.

When the delinquencies dipped in October, analysts began anticipating a continued recovery, but the rate jumped 35 basis points in November and another 27 bps in December. A total of $61.5 billion in commercial mortgages are either more than 30 days delinquent, in foreclosure or REO as of December, up from just over $60 billion the month before."

"U.S. government spending on Medicaid and Medicare rose almost six times faster than insurance company expenditures in 2009 from the prior year as the recession pushed more Americans onto public assistance, a federal report said.

The U.S. and states combined to spend $373.9 billion on Medicaid, the federal health program for the poor, an increase of 9 percent. Outlays for Medicare, aiding the elderly and disabled, rose 7.9 percent to $502.3 billion. Insurance companies led by UnitedHealth Group Inc. spent $801.2 billion, an increase of 1.3 percent.

The economic slowdown drove 3.5 million people onto Medicaid’s rolls in the period, said the report from the U.S. Centers for Medicare and Medicaid Services. The unemployment rate reached 10 percent and 6.2 million fewer people were enrolled in private health insurance, a 3.2 percent decline, according to the study."

"The city included $53.2 million in revenue from the lease in its budget for the current fiscal year, according to the memo. If the plan falls through, the deficit will grow from $9.5 million to $62.7 million this year through June, they said.

“The magnitude of this loss cannot be understated,” they said in the memo, referring to the possibility that the lease plan may fail. With the fiscal year half over, “the city will need to implement drastic solutions to address the revenue shortfall” that the plan’s failure would create, the memo said. "

  • Other news, headlines and opinion:

ECB Balance Sheet Grew 5.2% In 2010 To EUR2.004 Trillion At Year End

Earth's Population to Reach 7 Billion in 2011

Irish budget deficit 18.7 billion euros in 2010

Detroit School System May Use GM-Style Restructuring

EU Burden Sharing Proposal Pushes Up Senior Bond Insurance Cost

City of Flint's annual audit shows nearly $17 million deficit

Moody's Lowers Boom on Rock Co Bonds

Illinois income taxes could go up

House Republicans to Weaken Anti-Deficit Rules to Ease Tax Cut Approvals

Foreclosures May Be Undone by Massachusetts Ruling on Mortgage Transfers

Clear Capital Reports 4.1% Drop in Home Prices in 2010

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Re: Daily Digest 1/6 - Economic Temperature, Copper Prices ...

Frontrunning: January 6  http://www.zerohedge.com/article/frontrunning-january-6-0
One Minute Macro Update  http://www.zerohedge.com/article/one-minute-macro-update-12

Gold Standard Coming...Fed’s Hoenig Correct: Jim Rickards  http://www.caseyresearch.com/gsd/edition/gold-standard-comingfed%E2%80%9...
Gold gets pole-axed, but the radical gold bugs, and even some more orthodox observers, remain calmly confident.  http://www.marketwatch.com/story/gold-pole-axed-but-bugs-and-others-calm...
Jim Rickards - Gold Standard Coming, Fed’s Hoenig Correct  http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/1/6_Jim...
FSN Update on Energy with Bill Powers  http://www.financialsense.com/financial-sense-newshour/guest-expert/2011...

Metals and energy commodity open interest positions rise despite New Year rout http://www.mineweb.co.za/mineweb/view/mineweb/en/page31?oid=117935&sn=De...

World Bank taps offshore yuan bond market for first time  http://www.reuters.com/article/idUSTRE7040R820110105

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Re: Daily Digest 1/6 - Economic Temperature, Copper Prices ...

Global food prices at ‘record high’

Global food prices rose to a new high in December, according to the UN’s Food and Agricultural Organisation. Its food price index went above the previous record of 2008 that saw prices spark riots in several countries. 


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Re: Daily Digest 1/6 - Economic Temperature, Copper Prices ...

speaking of temperature:

NSIDC: Lowest December Arctic sea ice extent in satellite record - The cold may make the news, but it ain't the story - The National Snow and Ice Data Center has released its December report on Arctic sea ice.  The human-driven decline continues, spurred by a strong negative phase of the Arctic Oscillation, which leads to this regional air temperature anomaly:  Parts of Canada are astoundingly warm.  Nunatsiaq Online reports: … temperatures around South Baffin reached record highs as much as 20 degrees above normal.Iqaluit set new records with temperatures rising to +1.2 C Jan. 3 breaking the record of —1.7 C set in 1970, said Yvonne Bilan-Wallace, a meteorologist with Environment Canada. Jan. 4 saw another new record for the capital with a high of +1.5 C, breaking the old mark of —1.1 C set in 1969. “The normal around this time of year is around -22C,” she said. “So yeah, you’re way above normal.” Pangnirtung also set a record high temperature, peaking at +8 C Jan. 4,

map & graph included; even more amazing is that there's no sunlight up there this time of year -- the ice is melting in the dark....

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Re: Daily Digest 1/6 - Economic Temperature, Copper Prices ...

Youths riot in Algeria over high food prices

ALGIERS, Algeria – Riots over rising food prices and chronic unemployment spiraled out from Algeria's capital on Thursday, with youths torching government buildings and shouting "Bring us Sugar!"

Police helicopters circled over Algiers, and stores closed early. Security officers blocked off streets in the tense working-class neighborhood of Bab el-Oued, near the capital's ancient Casbah, and areas outside the city were swept up in the rampages.

The U.S. Embassy issued a warning to Americans in Algeria to "remain vigilant" and avoid crowds. 


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Infomercial funded by corporations such as Bank of America, the City of London Corporation, PepsiCo UK, Time Warner, Royal Dutch Shell and Vodafone,  Forum for the Future envisions scenarios for cities in 2040. This is not a joke.


@1:25 - “switch off brain and go to work”...




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Re: Planned-Opolis

All 4 scenarios are available at the link below


Like the high school segment at 1:40 with the BP logo-esque graduation cap animation. And the Global Food Council segment at 2:00 suggests the world's food is controlled and rationed by a single global entity (probably Monsanto).

Sounds like a dystopian Gulag.


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Re: Daily Digest 1/6 - Economic Temperature, Copper Prices ...

regarding arctic ice melting

google "arctic undersea volcanoes"

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Re: Planned-Opolis

Excuse me but wtf! "Cry Freedom Ghetto" 

Every time I finally shake the CTs, I get another reason to believe.

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Re: Daily Digest 1/6 - Economic Temperature, Copper Prices ...

grl - "ditto!"

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Look at how big this organization is...

Forum for the Future.org/partners

We work with over 100 leading organisations in business, government, education and the voluntary sector.

(full list of partners at link)
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Re: Daily Digest 1/6 - Economic Temperature, Copper Prices ...
RogerA wrote:

regarding arctic ice melting

google "arctic undersea volcanoes"

it seems unlikely to me venting from the gakkel ridge would cause the airmass over greenland to be 12C degrees above normal:

The National Snow and Ice Data Center has released its December report on Arctic sea ice -- a strong negative phase of the Arctic Oscillation leads to this regional air temperature anomaly:


NAO 12-10

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Re: Daily Digest 1/6 - Economic Temperature, Copper Prices ...


Look at how we as a people fight to maintain appearances while we go hungry behind closed doors.  Only now it's so bad, it can't be hidden.  At least we have our Ipods to listen to as we stand in the food lines.  Very sad.  We are so out of time.

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Keiser Report Monsanto and the Seeds of Evil

Wikileaks Monsanto revelations

~ VF ~

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Re: Daily Digest 1/6 - Economic Temperature, Copper Prices ...


Don’t Sweat $3.50 Per Gallon Gas


Yippee, nothing to worry about per this article!

But I think we have not yet been forced to make the tough adjustments.

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Re: Daily Digest 1/6 - Economic Temperature, Copper Prices ...

For 1/7 news:


"The Fed's asset holdings in the week ended Jan. 5 rose to $2.439 trillion, from $2.423 trillion a week earlier, it said in a weekly report released Thursday.

The Fed's holdings of U.S. Treasury securities rose to $1.031 trillion on Wednesday from $1.016 trillion a week earlier."

"LISBON, Portugal (AP) - The yield on Portuguese 10-year bonds has risen to a euro-era record of 7.1 percent amid market fears about the debt-laden country's economic health.

Investors are worried that Portugal won't be able to meet its debt obligations and may need a bailout like Greece and Ireland, deepening the eurozone's debt crisis."

"Illinois Democratic leaders in the General Assembly say they have an agreement with Governor Pat Quinn to raise income taxes and corporate levies to help eliminate a budget deficit of at least $13 billion this year.

The Democratic plan includes about $12 billion in borrowing to make pension contributions and pay bills. The components of the revenue-generating package could change, Senate President John Cullerton, a Democrat, said yesterday.

Illinois’s worst financial crisis is prompting the proposal to raise the state’s 3 percent personal income tax to 5¼ percent. Two percentage points of that increase would be temporary, lasting three years, Cullerton said.

“It’s the right time to do it because we’re in desperate need to pay our bills,” Cullerton told reporters at the state capitol in Springfield."

.....................3A) Income tax could rise 75 percent (Illinois)

"SACRAMENTO -- Saying schools are in a "state of financial emergency," the Superintendent of Public Instruction on Thursday called on Californians to get involved in local schools and support tax measures that benefit education.

"It is time to call it what it is," Tom Torlakson said during his first news conference since taking office earlier this week. "It is indeed a crisis of the proportion of an emergency."

He said $18 billion in education cuts over the past three years have caused thousands of layoffs, increased class sizes, shortened school years in many districts and eliminated or reduced programs such as libraries, art and music. He said 174 of the state's 1,077 school districts are in financial distress, signaling they may not be able to pay their bills in the next three years."

"SACRAMENTO (KABC) -- Blue Shield is proposing huge new rate hikes that could mean an increase of nearly 60 percent for policyholders. Now California's new insurance commissioner is calling for a delay. The rate hikes could affect hundreds of thousands of Californians.

He's been on the job less than a week and already California Insurance Commissioner Dave Jones has had to play hardball with Blue Shield, which just told nearly 200,000 California customers with individual health policies their rates are going up as much as 59 percent as of March 1.

"I have asked that the company postpone its rate increase 60 days in order to afford me the opportunity to fully review the proposed rate increase," said Jones.

The move comes less than a year after Anthem Blue Cross tried but failed to get a 39-percent rate increase.

Blue Shield says its rate hike averages about 33 percent, but this would be the company's third rate hike since October.

San Diego resident Michael Fraser, who doesn't have insurance from his job, is seeing his monthly premium jump from $271 a month to $431 -- that's 59 percent.

"It's really devastating. I don't know what to do," said Fraser. "I'm seriously considering cancelling my insurance and taking my chances. I'm 53 years old, and that's scary." "

  • Other news, headlines and opinion:

Europe sovereign-debt insurance costs rise further

West European Debt Riskier Than Region's East for First Time: Euro Credit

Illinois Plans Pension Bond as Taxable Yield Soars to Record: Muni Credit

Chile Bond Yields Surge on $10 Billion Central Bank Sale Plans

Detroit's 3000 demolished home goal within reach

Belgian CDS hits record high on political concerns

State budget office predicts $829 million gap this year, $1.4 billion by 2013 (South Carolina)

State's credit rating at risk (South Australia)

Food crisis threatens India

New Wake superintendent Tata likely to face $70-100 million budget deficit in first year (North Carolina)

US pension fund deficits rise

Algeria: Riots over high food prices

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