Daily Digest 3/7 - Greece Selling Off Corfu, Districts Peer Into Budgetary Abyss, Rising Gas Prices Trap Lobstermen
- Cash-strapped Greece begins its bid to raise funds… by selling off Corfu
- ECB Balance Sheet Jumps to a Record $3.96 Trillion Amid Lending to Banks
- Ky. retirees may lose cost-of-living increases
- School Districts Peer Into Budgetary Abyss
- Schools face $8 million in possible budget cuts
- State analysts brief Maryland lawmakers on ‘doomsday’ budget plan
- Biggest Court in Nation Cuts Operations in 'Crippling Blow'
- Ontario budget: Hundreds of daycares will close without new money in the spring budget
- Unintended Consequences: ECB’s Effort to ‘Save’ Europe Will Lead to Its Demise, Mauldin Says
- Long Beach board of education to review worst-case scenario budget
- China orders local govts to set up debt repayment funds
- China’s debt mounts to $2.78 trn, 43% of GDP
- Healthcare firms asked to take Greek debt writedown
- Suffolk budget panel predicts $530M deficit
- EIA raises price forecasts for U.S. oil, fuels
- Spain's Regions commit to new 2012 deficit target
- Alarming Number of Homeless Students
- Some states consider higher fuel taxes
- Indonesia Seen Facing Inflationary Spiral
- Rising gas prices trap lobstermen
Greece is trying to sell off a huge slab of land on the holiday island of Corfu to raise cash to tackle its debts, it emerged today.
Government officials revealed a tender has been launched for the exploitation of a large seaside plot on the western resort island. The Hellenic Republic Asset Development Fund said it is seeking to sell the 'right of surface' for the 120-acre, forested property at Kassiopi for up to 100 years.
The European Central Bank’s balance sheet surged to a record 3.02 trillion euros ($3.96 trillion) last week, 31 percent bigger than the German economy, after a second tranche of three-year loans.
Lending to euro-area banks jumped 310.7 billion euros to 1.13 trillion euros in the week ended March 2, the Frankfurt- based ECB said in a statement today. The balance sheet gained 330.6 billion euros in the week. It is now more than a third bigger than the U.S. Federal Reserve’s $2.9 trillion and eclipses the 2.3 trillion-euro gross domestic product of Germany (EUANDE), the world’s fourth largest economy.
State and local government retirees in Kentucky won't get cost-of-living pension increases over the next two years under a budget proposal that could face a House floor vote by midweek.
Some 200,000 retirees had been slated to receive 1.5 percent increases, but House lawmakers, faced with tight finances, are recommending those hikes be suspended. "It's a difficult budget," said state Rep. Rick Rand, chairman of the House Appropriations and Revenue Committee. "This is just the times we're in."
The Carlsbad school board just voted to eliminate 20 percent of its teaching positions. San Diego Unified is poised to issue more than 1,600 pink slips to teachers. Sweetwater Union is contemplating one-year cuts that amount to nearly triple the cuts previously made in a decade. At this point, school officials can’t say whether all or even some of that may come to pass.
School districts are facing perhaps their most difficult and uncertain budget year ever. The annual budget dance has always had a specter of unpredictability because deadlines force districts to make budget and staffing decisions well before they know how much money they will get from the state.
Gov. Jerry Brown hopes to raise $6.9 billion in revenue by temporarily increasing the state sales tax by half a cent and raising taxes on individuals who earn $250,000 or more per year. The tax increases would expire in five years.
If the taxes don’t pass, Napa Valley Unified will face a mid-year cut of up to $450 per student and a gaping budget shortfall of $8.6 million, said Wade Roach, assistant superintendent of business services. The impacts of those cuts would be widespread, affecting everything from transportation to counseling services.
Maryland analysts have outlined nearly $800 million in additional budget cuts to fill budget gaps in case lawmakers can’t agree on new taxes or savings.
Warren Deschenaux, director of the state’s Office of Policy Analysis, presented a wide-ranging variety of cuts on Tuesday that would impact education, health, environmental programs and state agencies. It’s being described as a “doomsday” budget plan.
The nation's biggest court announced Monday extraordinary staff cuts and courtroom closures as a result of both California's budget crisis and long term policy by the top administrative brass for California's courts.
"These are extraordinary measures, never before seen in the Los Angeles Superior Court," wrote Presiding Judge Lee Edmon in a memo sent to court staff Monday. "These changes will affect every judicial officer and staff member -- as well as the millions of attorneys and litigants who depend upon our courts to deliver justice."
Hundreds of Ontario daycares will close if there is no new money in the provincial budget this spring, advocates warn.
At least $287 million in emergency funding is needed this year to stabilize the system, say parents and child-care operators who are taking their campaign to Queen’s Park on Tuesday. “We need that money and we need it right now,” said Andrea Calver of the Ontario Coalition for Better Child Care. “If we don’t get it, we will see a wave of closures across this province and we will see a lot of heartache from parents who, even today, are having trouble finding child care.”
The drama over Greece's bailout comes to a head this week. Debt holders have until Thursday to accept or reject the "voluntary" 53.3% haircut on their Greek holdings. If less than 75% of bondholders reject the terms, Greece will be considered in default, which would be the first sovereign default in the eurozone.
The Long Beach Unified Board of Education on Tuesday is expected to review a grim budget plan that calls for extreme cuts including eliminating high school sports and slashing the school year by 20 days if a November tax initiative fails.
In a worst-case scenario, the district projects a $189 million deficit out of its $700 million operating budget by 2014 if state budget cuts continue.
Many analysts believe local government debt could threaten China's banks if cash-strapped local governments default and saddle them with a stock of sour loans. As banks supplied most of the local government loans, a domino effect could put overall financial system stability at risk in a worst case scenario.
Although China's local debt woes have festered for over a year, Beijing has offered few details on the extent of the problem or possible solutions. The lack of information led some analysts to guess at least a fifth of loans, worth 2-3 trillion yuan, have gone bad. They say that could cause banks' non-performing loan ratios to more than quadruple to about 5 percent.
China may be sitting on world’s highest foreign exchange reserves of about USD 3.20 trillion but it is also burdened with USD 2.78 trillion government debt causing great deal of concern among policy makers.
China's government debt amounts to about 17.5 trillion yuan (USD 2.78 trillion) about 43 per cent of the country's gross domestic product (GDP), Yang Kaisheng, president of the Industrial and Commercial Bank of China, said Tuesday. It is composed of 10.7 trillion yuan (USD 1.7 trillion) of local government debt and 6.8 trillion yuan of central government debt, Yang told a press conference on the sidelines of China's annual parliamentary session.
International healthcare firms have been asked to accept losses on Greek government bonds they got in exchange for unpaid hospital bills, evidence that the country's debt restructuring deal will have an impact beyond the mainstream financial sector.
Suffolk County's fiscal health was given an ominous outlook Tuesday morning, with an independent budget panel forecasting a combined deficit of $530 million through 2013. The panel, formed in January by County Executive Steve Bellone, said lawmakers and officials had crafted budgets with overly optimistic projections in sales tax growth and unrealistic savings from layoffs and overtime reductions.
"The truth is worse than we could have imagined," Bellone said in introducing the panel at a meeting of the legislature's budget and finance committee. "It is not pleasant, but it is reality."
The Energy Department raised its price forecasts for crude oil, gasoline and other petroleum products Tuesday, estimating oil prices will average $106 a barrel this year. U.S. retail gasoline prices are expected to average $3.92 a gallon this summer, with average monthly prices peaking at $3.96 a gallon in May, the Energy Department's forecasting group, the Energy Information Administration, said in its monthly Short-Term Energy Outlook.
Two months after coming to power at the end of December, the conservative leader last week announced his government will prepare a 2012 budget that aims to reduce its deficit to 5.8% of gross domestic product, far in excess of the 4.4% target his predecessor, Jose Luis Rodriguez Zapatero, had committed to with the European Union.
Under Rajoy's plan, the central government in Madrid will be allowed to run a deficit of 4% of GDP in 2012, up from 3.2% earlier, and regional governments will be allowed a new target of 1.5%, up from 1.3%
It’s a statistic that may alarm you, and even tug at your heart strings. Ten percent of students in one Southern Colorado School District are without a home.
As if gas prices weren't high enough, several states across the U.S. are looking to raise fuel taxes they say are needed to pay for roads and bridges that are outdated, congested and in some cases, dangerous.
Maryland's governor is proposing a phased-in 6 percent sales tax by 2 percent a year, which would raise about $613 million annually when fully implemented. Iowa is considering raising its current 21-cent-per-gallon tax by either 8 cents or 10 cents. Such proposals were hard to even contemplate during the recession and its immediate aftermath. Now, states forced to grapple with the problem are running into record-high gas prices for this time of year and lingering effects of the recession.
Indonesia could get caught in an inflationary spiral as rising global oil prices and falling gasoline subsidies at home combine with rising wages, said Sofjan Wanandi, chairman of one of the country's most influential business organizations.
Local governments raised minimum wages in key industrial zones near Jakarta by as much as 36% last month. Similar increases could spread to other parts of the country
Dave Casmi has made his living fishing for lobsters along the coast of Cape Cod, Massachusetts, for 40 years. But he and other lobster fishermen are asking themselves if it's even worth untying their boats from the dock anymore.
In today's market, they are suffering from an economic triple whammy: High fuel prices mean it's more expensive to trap lobsters, and the recession finds fewer people splurging on their catch. Plus, a lobster's market value begins depreciating the moment it's caught. "I'm getting what I got 15 years ago," he said, referring to the amount distributors are paying for his catch. "Just how long would you spend $3 to make $4?"
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