Dallas pension system suspends access to some funds
The Dallas Police and Fire Pension system board has voted to suspend all withdrawals and payments coming out of deferred retirement funds.
The vote Thursday stops more than $154 million in requested withdrawals from being distributed Friday. Pension officials say the withdrawals would drop reserves below what's needed to sustain the fund. More than $500 million has been withdrawn since August.
Dallas Mayor Mike Rawlings had filed a lawsuit to stop the lump-sum withdrawals, which he said have sped up the estimated insolvency projection for the ailing fund to about 10 years.
System officials say they are working to convert illiquid assets to liquid assets to resume monthly payments in January.
People Who Laughed at TRUMP...and said he would never be President
Most Jobs Created Since 2005 Are Temporary or Unsteady
If you're wondering why it's so hard to find a steady 9-5 job, here's a really good reason: They're not being made.
It's a dark lining to last week's silvery jobs report. Unemployment fell to 4.6 percent for November, the lowest since the financial crash of 2008. It's also within the range of what Fed policy makers call "full employment."
But a recently updated study by Harvard and Princeton economists shows that a staggering 94 percent of net job growth from 2005-2015 was in "alternative work." That's "temporary" or "unsteady" work, like independent contracting and temp agencies. Yes, the Uber-driving, on-demand cupcake delivery economy is part of it — but a small one, just 0.5 percent.
The study's authors, Lawrence Katz and Alan Krueger, point out that the majority of these temporary employees are on-call workers, freelancers, temp agency workers, independent contractors, and workers hired out through contract firms. As companies have added back jobs that were cut, they want to have more flexibility. They staff up for specific projects and initiatives without bringing on board full-time workers — or having to pay for their health insurance.
AstraZeneca Cuts About 700 Jobs
British-based pharmaceutical company AstraZeneca says it is eliminating about 700 jobs in its U.S. commercial business, including about 120 at its North American headquarters in Wilmington.
The company said Thursday that the cuts also affect sales and non-sales positions across the United States, and include roughly 80 vacant positions.
The job cuts will leave AstraZeneca with about 1,500 employees in Delaware. AstraZeneca, which once employed close to 5,000 workers in Delaware, announced in 2013 that it was cutting 1,200 jobs at its Wilmington headquarters.
In persuading AstraZeneca to select Wilmington over Pennsylvania as the site of its U.S. headquarters in 1999, then-Gov. Tom Carper offered the company about $50 million in state incentives, including 86 acres of state-owned land and tens of millions of dollars in tax credits.
Draghi Says Italy Must Address Weaknesses No Matter What Happens
European Central Bank President Mario Draghi said that Italy will have to undertake economic reforms, no matter what the outcome of the country’s political crisis.
“The vulnerabilities that both the banking system and Italy have, have been there for a long time,” Draghi said at a press conference in Frankfurt on Thursday. “So they ought to be coped with, and I am confident the government knows what to do, and they will be dealt with.”
The euro area’s third-largest economy is facing political turmoil after voters’ rejection of a constitutional overhaul prompted reformist Prime Minister Matteo Renzi to resign. The country’s political leaders are starting discussions that may lead to the appointment of a technocratic government and early elections.
“Countries that need reforms have to undertake them regardless of what is the general political uncertainty because the best way for countries to cope with this uncertainty is actually to restore growth and employment and job creation,” Draghi said in his press conference.
Revival of Silver Manipulation Case Brings 'Vindication’
Consumers, businesses, and CEOs are all loving life since Trump's election — and that's great news for the economy
Americans from all corners of the economy seem to be enjoying the conditions a lot more since the election of Donald Trump.
Nearly every measure of consumer, business, or executive confidence has gained in the month since the election according to Michelle Meyer, chief US economist at Bank of America Merrill Lynch.
"The data clearly show that consumers, investors, and business CEOs have all become more optimistic since the election," wrote Meyer in a note to clients on Thursday.
Everything from regional manufacturing indexes to consumer confidence surveys to investor sentiment have ticked up since November 8. The only survey that has slid is the ISM-adjusted Empire Manufacturing survey that measures confidence of New York state manufacturers. "Bottom line: most business activity surveys point to greater confidence following the election," concluded Meyer.
John Glenn, first American to orbit the Earth, dies at 95
John Glenn, a former US senator and the first American to orbit the Earth, died Thursday, according to Ohio State University. He was 95.
It was announced Wednesday that Glenn had been hospitalized "more than a week ago," according to Ohio State University spokesman Hank Wilson. He was at the James Cancer Hospital at Ohio State University, but his illness was not disclosed. Glenn had heart valve replacement surgery in 2014.
"With John's passing, our nation has lost an icon and Michelle and I have lost a friend," Obama said. "John spent his life breaking barriers, from defending our freedom as a decorated Marine Corps fighter pilot in World War II and Korea, to setting a transcontinental speed record, to becoming, at age 77, the oldest human to touch the stars. John always had the right stuff, inspiring generations of scientists, engineers and astronauts who will take us to Mars and beyond -- not just to visit, but to stay. ...
"The last of America's first astronauts has left us, but propelled by their example we know that our future here on Earth compels us to keep reaching for the heavens."
Venezuela's economic collapse sees fishermen turn to piracy and slaughter one another
Gangs of out-of-work fishermen have turned to a life of piracy and have killed dozens who still venture into the sea in Venezuela, as the country's economic crisis worsens. Once home to the world's fourth-largest tuna fleet, now the fishing trade has collapsed and those who continue to fish are falling prey to the vicious bandits.
Many have been tied up and thrown overboard by pirates, as those with boats opt for illegal ways of making money, such as smuggling and piracy. Robberies on the sea have happened daily, leaving scores of fishermen dead.
'People can't make a living fishing anymore, so they're using their boats for the options that remain: smuggling gas, running drugs and piracy,' said Jose Antonio Garcia, leader of the state's largest union. Teenager Flaco Marval has lost a brother and two cousins to pirates, and has been told they were coming for the rest of the family.
The skinny 17-year-old and his relatives ran to grab the guns they'd soldered together from kitchen pipes, smoked an acrid-smelling drug to boost their energy, and went out into the night to patrol the sandy village streets. He said: 'We just have to kill these thugs, and then we can go back to fishing like we always did.'
Cash Is No Longer King: The Phasing Out of Physical Money Has Begun
As physical currency around the world is increasingly phased out, the era where “cash is king” seems to be coming to an end. Countries like India and South Korea have chosen to limit access to physical money by law, and others are beginning to test digital blockchains for their central banks.
The war on cash isn’t going to be waged overnight, and showdowns will continue in any country where citizens turn to alternatives like precious metals or decentralized cryptocurrencies. Although this transition may feel like a natural progression into the digital age, the real motivation to go cashless is downright sinister.
The unprecedented collusion between governments and central banks that occurred in 2008 led to bailouts, zero percent interest rates and quantitative easing on a scale never before seen in history. Those decisions, which were made under duress and in closed-door meetings, set the stage for this inevitable demise of paper money.
Sacrificing the stability of national currencies has been used as a way prop up failing private institutions around the globe. By kicking the can down the road yet another time, bureaucrats and bankers sealed the fate of the financial system as we know it.
Loyalton, California's pension default is a wake up call
Sick … a punch in the stomach.That’s how public retirees in Loyalton, California, are taking news that their town defaulted on its pension payments, resulting in the possibility of their retirement benefits being cut by as much as 60 percent, the majority of their hard-earned livelihood.
Pension debt is not a new story — in fact, most of the country’s public pensions are significantly underfunded (state and local pensions across the U.S. have an estimated $5 trillion less than needed to cover promised benefits). But this time the largest pension plan in the nation, the California Public Employees’ Retirement System (CalPERS), has thrown public employees overboard. And that has government workers and retirees across the country asking, could this happen to me? The answer is yes! If your city runs out of money and your pension plan is not fully funded, you will lose. The only question is how much.
Loyalton withdrew from CalPERS in 2013, upon the retirement of its last guaranteed pensioner. For council members, it just made sense — after all, the town had been fully paying its required annual contributions all along.
But what it didn’t count on was the $1.6 million termination fee demanded by CalPERS to cover unfunded liabilities which CalPERS has allowed to grow for the last 17 years. The fee amounts to a whopping $320,000 per each of Loyalton’s five retirees, an amount that is impossible for the town to pay. And now CalPERS has put the retirees on notice that their monthly checks will be cut.
Americans On Track To Add $80 Billion In Credit Card Debt By End Of The Year
U.S. consumers racked up $21.9 billion in credit card debt during Q3 2016, which is the seventh-largest third-quarter accumulation in the last 30 years, according to the personal-finance website WalletHub’s 2016 Credit Card Debt Study, released today. We are now on track to finish 2016 with an $80 billion net increase in credit card debt.
Credit card debt statistics speak to the financial health of American households and can foretell overleveraging bubbles that may trigger constriction across lending markets. From that perspective, the fact that U.S. consumers racked up a record-setting $21.9 billion in credit card debt during the third quarter of 2016 represents serious cause for concern.
Not only was it the largest third-quarter debt increase since 2007 and the seventh-largest in the last 30 years, but our dismal Q3 2016 performance also comes on the heels of three equally foreboding financial feats, appearing to solidify an ominous trend. We set the Q2 record last quarter, racking up $34.4 billion in new debt, right after recording the smallest Q1 pay-down ($27.5 billion) since 2008. And last year, we added the most credit card debt to our tab ($71 billion) since 2007.
So it is not a question of whether consumers are weakening financially, but rather how long this trend toward pre-recession habits will last and just how bad it will get. Unfortunately, the immediate forecast does not appear too bright. WalletHub projects that we’ll end 2016 with a net increase of roughly $80 billion in credit card debt, which would bring outstanding balances within striking distance of 2008’s all-time record and push the average amount owed by indebted households to a perilous $8,380.
Starbucks' next CEO: We'll never have robots
Barely Half of 30-Year-Olds Earn More Than Their Parents
Barely half of 30-year-olds earn more than their parents did at a similar age, a research team found, an enormous decline from the early 1970s when the incomes of nearly all offspring outpaced their parents. Even rapid economic growth won’t do much to reverse the trend.
Economists and sociologists from Stanford, Harvard and the University of California set out to measure the strength of what they define as the American Dream, and found the dream was fading. They identified the income of 30-year-olds starting in 1970, using tax and census data, and compared it with the earnings of their parents when they were about the same age.
In 1970, 92% of American 30-year-olds earned more than their parents did at a similar age, they found. In 2014, that number fell to 51%. “My parents thought that one thing about America is that their kids could do better than they were able to do,” said Raj Chetty, a prominent Stanford University economist who emigrated from India at age 9 and is part of the research team. “That was important in my parents’ decision to come here.”
Although there are many definitions of the American Dream—the freedom to speak your mind, for instance, or the ability to rise from poverty to wealth—the economists chose a measure that they said was possible to define precisely.
CA State Senate President Files Bill to Create Illegal Immigrant ‘Safe Zones’
California Senate President Kevin de León (D-Los Angeles) has introduced legislation to prevent state and local law enforcement from aiding federal immigration officials in deportations of illegal immigrants, he announced in a press release on Wednesday.
The bill entitled the California Values Act – or in de León’s words, a “bill to freeze out ICE” – would also create “safe zones” throughout the state in locations such as public schools, hospitals, and courthouses, where state and local law enforcement would be prohibited from enforcing immigration laws.
“To the millions of undocumented residents pursuing and contributing to the California Dream, the state of California will be your wall of justice should the incoming administration adopt an inhumane and over-reaching mass-deportation policy,” Sen. de León said in a statement. “We will not stand by and let the federal government use our state and local agencies to separate mothers from their children.”
While the California Values Act does not prevent state and local law enforcement from complying with judicial warrants to transfer violent offenders into federal custody for deportation, they are prohibited from performing the functions of a federal immigration officer and from cooperating with Immigration and Customs Enforcement (ICE) agents in deportations.
Anti-austerity protesters again hit the streets of Greece
Did Big Oil Layoff Too Many Workers Too Quickly?
What was once a mere warning to the oil industry has now become a reality: the severe cost cuts undertaken by virtually every oil and gas business in the world has created a serious workforce shortage, with massive layoffs pushing skilled workers into new lines of work.
On a global scale, the overall number of job cuts in the oil and gas industry reached around 350,000, according to a report from Graves & Co. That was in May, when prices had recovered somewhat.
Oil prices have since risen to above $50, and not just because of OPEC’s agreement to cut production. Energy businesses, especially in the shale patch in the U.S., adapted to the lower-for-longer price environment, with some, but not all, managing to lower their breakeven point enough to be able to start raising production again.
Big Oil has started to pay more attention to smaller, quicker-return projects, and although they are not yet hiring on any meaningful scale, the downward trend in oil and gas employment is slowing down, and may be reversed in the not too distant future. Unfortunately for Big Oil, the layoffs so far have included large numbers of highly qualified and uniquely skilled staff—a significant portion which have, in all likelihood, found employment elsewhere. Even not-so-highly-qualified employees have moved on. If the oil industry attempts to hire again, it will find itself training a whole new generation of engineers, drillers, and other special-skills personnel.
Sears and Kmart store closings and losses mount
Troubles continue to mount for Sears and Kmart, as the iconic retailers posted another quarter of large losses and warned that its rapid pace of store closings will ramp up .
Sears Holdings, which owns both retailers, did not disclose how many stores it plans to close in the coming months. "We will continue to accelerate the closing of underperforming stores," said Chief Financial Officer Jason Hollar. "We do not intend to borrow money to fund continued operating losses," he said.
The company closed 82 Kmart stores and seven Sears stores during the three months ending in October. That's on top of the 58 Kmart stores and 23 Sears stores closed in the first six months of the year. The two chains had 4,000 stores as recently as 2011, but are now down to 1,500 stores.
The company lost $748 million in the most recent quarter, up from the $454 million loss in the year-ago period. Revenue tumbled 12.5%, due to both the store closings and a 7% drop in sales at the stores that remained open.
The Fed shouldn't be driving US economy, Trump advisor Judy Shelton says
The Federal Reserve shouldn't be driving the United States economy because monetary stimulus is quite limited, Trump economic advisor Judy Shelton told CNBC on Wednesday.
"What you want is productive growth and the kind of growth that is truly stimulated by tax reform, by regulatory reform, trade reform and important infrastructure projects to upgrade our ability to be more productive as a nation," she said in an interview with CNBC's "Closing Bell."
That's what President-elect Donald Trump has pledged to do when he takes office, and the market apparently likes what it's hearing. It has been rallying since Trump's surprising win on Nov. 8, and on Wednesday the Dow Jones industrial average and S&P 500 hit all-time highs.
However, the Fed meets next week and it is widely believed it will hike interest rates. Shelton, though, doesn't believe a small rate increase is going to derail the rally because it is already priced in. If there is turmoil, then "things are a lot more fragile than we thought," she said.