We begin close to home with a headline from Salon:
California faces water shortages and wildfires as “mega-drought” gets even worse
- The fire danger is “about as high as it can be,” one meteorologist warned
The year 2013 was California’s driest on record, featuring the least rainfall since the state started keeping track in 1849. And so far, 2014 is off to a bad start.
A full 63 percent of the state is in extreme drought conditions, according to the U.S. Drought Monitor — up from 23 percent just last week and extending into northwestern Nevada. Precipitation for the water year (which begins October 1) is less than 20 percent of normal levels in the areas of most extreme drought. Up in the Sierra Nevada mountains, snowpack — a major repository for the state’s water supply — is between 10 and 30 percent of normal, with many locations now in the bottom 5th percentile. Two of the state’s lakes are only 36 percent full; the San Luis Reservoir in Central Valley is down to 30 percent.
“It’s really serious,” Gov. Jerry Brown said Monday. “In many ways it’s a mega-drought; it’s been going on for a number of years.” Any day now, he’s expected to announce that California is officially in the midst of a drought.
More from the New York Times:
As California’s Drought Deepens, a Sense of Dread Grows
On Friday, Gov. Jerry Brown made it official: California is suffering from a drought, perhaps one for the record books. The water shortage has Californians trying to deal with problems that usually arise midsummer. With little snow in the forecast, experts are warning that this drought, after one of the driest years on record last year, could be as disruptive as the severe droughts of the 1970s.
Under state law, that would allow the governor to “waive laws or regulations and expedite some funding,” said Jeanine Jones, deputy drought manager for the state Department of Water Resources. “It does not create a new large pot of money for drought response or make federal funding available.”
Reuters gets defensive:
Latest perk on Google buses: security guards
- First, San Francisco-based commuters to Google Inc got buses with plush seats and free WiFi. Now, they are getting security.
In recent days, men with earpieces have closely monitored passengers boarding Google commuter buses at the site of at least one bus stop in San Francisco’s Mission District. Their presence comes a few weeks after Google buses were targeted by protesters who blame tech-industry employees for rising city rents.
Gone are the days when mentioning Google as an employer gave young technology workers a certain counterculture credibility. As the company has expanded well beyond its Web search-engine roots to become a behemoth encompassing advertising, smartphones, finance and social networking, it has gone from scrappy start-up to a Goliath that many resent for its power.
In San Francisco, many long-time residents believe the influx of richly compensated workers at Google and other big technology companies such as Facebook Inc and Twitter Inc has pushed rents to unaffordable levels in neighborhoods that once were homes to the working class.
The Denver Post bites:
Edible marijuana sales shattering sales projections in Colorado
A one-month supply of marijuana edibles, gone in the first three days of January; that’s what the area’s largest supplier is saying about the incredible demand for the product since recreational sales were legalized in Colorado on Jan. 1.
“We are working hard,” said Joe Hodas, chief marketing officer for Dixie Elixirs and Edibles. “We like to call ourselves the future of cannabis.”
There is so much demand for edibles right now, they limit customers to two edible products a day at recreational pot shops like LoDo Wellness at 16th St. and Wazee in downtown Denver.
The Guardian pays out:
Goldman Sachs pays employees average of $383,000 after profits rise 5%
- US bank’s 32,900 global employees to hear size of individual bonuses, while fixed-income trading operation had fall in profits
Goldman Sachs paid its bankers an average of $383,000 (£233,000) in 2013, after profits for the year rose by 5% to $8bn.
Putting a fresh focus on the debate over bankers’ pay, Goldman’s 32,900 global employees will be told the size of their individual bonuses on Thursday.
The bank set aside $2.19bn in the quarter ending December 31 to compensate employees, up 11% from a year earlier but down 8.1% from the previous quarter. Goldman partners were told about their bonuses on Wednesday.
From the Los Angeles Times, class debt:
Banks embracing a housing-bubble favorite: interest-only loans
Customers for interest-only loans are often self-employed and capable of making big down payments and maintaining fat bank accounts.
Most of the risky mortgages that triggered the financial crisis have disappeared from the marketplace, and lenders will have even more reason to avoid them because of a new federal crackdown on loose lending.
But one housing-bubble favorite — the interest-only loan — will remain a common offering to well-heeled home buyers, despite new rules from the Consumer Financial Protection Bureau. The rules, which took effect last week, exclude interest-only loans from “qualified mortgage” status, which protects lenders from liability over defaults.
Bankers don’t seem worried about affluent clients missing payments. With high-end home prices on the rise, they have recently embraced jumbo mortgage lending, including interest-only mortgages. That trend continued this week as the banks reported earnings, with Bank of America Corp. saying 36% of its fourth-quarter mortgages were jumbo loans, up from 23% of originations in the first quarter.
Bloomberg Businessweek retaliates:
Scandal Bowl: UNC Suspends Research by Academic Fraud Whistle-Blower
The most outrageous scandal infecting the business of big-time college sports just took a turn for the much worse. The University of North Carolina, famed for its outstanding academics and championship-winning basketball team, announced late Thursday that it had suspended research on athlete literacy by Mary Willingham.
A campus tutor employed by the university, Willingham has done more than anyone else to shed light on classroom corruption at Chapel Hill related to keeping sports stars eligible to play. The shadow cast on her research speaks volumes about the university’s unwillingness to come to terms with the undermining of academic standards in the service of athletics.
From Romenesko, more blood on a California newsroom floor:
Orange County Register owner names new newsroom leaders, confirms 32 layoffs
Orange County Register owner and publisher Aaron Kushner confirms in a memo that 32 newsroom employees were laid off today, and that Ken Brusic and other top editors have resigned. (I’m told they quit in protest of the layoffs.)
Local editor Rob Curley has been promoted to top editor.
CNBC cops out:
Battle over police pensions in US cities takes ugly turn
A drive by some American cities to cut costly police retirement benefits has led to an extraordinary face-off between local politicians and the law enforcement officers who work for them.
Another copout from Al Jazeera America:
NYPD agrees to ‘largest protest settlement in history’
- New York City civil rights activists hail settlement over 2004 RNC demonstrations as a victory against mass arrests
In what civil rights lawyers have called “the largest protest settlement in history,” New York City has agreed to pay $18 million to protesters who said they were wrongly arrested at the 2004 Republican National Convention, where then-president George W. Bush was nominated for a second term.
The settlement ends nearly a decade of legal battles between the New York Police Department and plaintiffs who said police forces mishandled their arrests and violated their First Amendment rights.
Approximately 1,800 people were arrested, out of nearly 800,000 protesters, mostly on charges of parading without a permit or disorderly conduct. The circumstances of those arrests were heavily disputed, according to a statement from the New York City law department.
Red state blues from The Guardian:
North Carolina’s poorest hit by federal cuts: ‘Unless someone helps, we’re bust’
- As Congress wrangles with whether to restore long-term unemployment benefits, North Carolina is already experiencing the hardship likely to unfold unless the program is restored
Debt for the rising generation from Bloomberg Businessweek:
Student Loans, the Next Big Threat to the U.S. Economy?
Outstanding student debt topped $1 trillion in the third quarter of 2013, and the share of loans delinquent 90 days or more rose to 11.8 percent, according to the Federal Reserve Bank of New York. By contrast, delinquencies for mortgage, credit card, and auto debt all have declined from their peaks.
The New York Federal Reserve’s move to measure the size of the student loan load says a lot about how concerned the central bank is about a possible threat to the economy. “Our job is to really understand what’s happening in the financial system,” and the “very rapid rise in student loan debt over the last few years” can “actually have some pretty significant consequences to the economic outlook,” New York Fed President William Dudley told reporters in November. “People can have trouble with the student loan debt burden—unable to buy cars, unable to buy homes—and so it can really delay the cycle.”
The federal government is the source and backer of most of the loans. “I’m always made very nervous by a credit market that benefits from government guarantees and is expanding very rapidly,” Jeffrey Lacker, president of the Federal Reserve Bank of Richmond, said on Jan. 10 at a Greater Raleigh Chamber of Commerce event in North Carolina. “That’s what we’re seeing with student loans, and it’s what we saw with housing.” As the New York Fed’s Dudley explained in November, “to the extent that student loan burdens become very, very high, there are presumably going to be losses” to the federal government.
For our first global story, this from TheLocal.ch:
Inequality poses world’s greatest risk: report
The growing gulf between the rich and the poor represents the biggest global risk this year, the World Economic Forum declared on Thursday ahead of this month’s Davos summit.
The Geneva-based institution issued the gloomy warning in its annual Global Risks survey, published before its annual get-together of decision-makers at the Swiss mountain resort of Davos from January 22nd-25th.
“The chronic gap between the incomes of the richest and poorest citizens is seen as the risk that is most likely to cause serious damage globally in the coming decade,” the WEF concluded.
In its Global Risks 2014 report, which is based on a survey of more than 700 experts from industry, government, academia and civil society, the WEF outlined possible events that could damage the world economy this year.
The London Telegraph heads to the MINT:
How to invest in the ‘MINT’ emerging markets
Mexico, Indonesia, Nigeria and Turkey have been tipped as the next economic giants. Can savers make money or is this the latest investment fad?
The chances are you have probably heard that Mint is no longer just a peppermint sweet; it is now also an investment acronym which in the next decade or two could prove extremely profitable for investors.
The concept, which groups the countries of Mexico, Indonesia, Nigeria and Turkey, has been popularised in recent weeks by respected economist Jim O’Neill, the man who also coined the BRIC term in 2001, identifying Brazil, Russia, India and China as the next global economic powerhouses.
Splitting the difference with EUbusiness:
Bundesbank sees ‘limited’ risk of eurozone deflation
There is only a “limited” risk of deflation — or falling prices — in the 18 countries that share the euro, the head of Germany’s central bank or Bundesbank, Jens Weidmann, said on Thursday.
His remarks came after, and in contrast to, a warning from the head of the International Monetary Fund on Wednesday that the “ogre” of deflation was a potential threat to the world economy.
Eurozone inflation slowed to just 0.8 percent in December from 0.9 percent in November, according to the latest data published by the Eurostat statistics agency.
Auto anxieties from the London Telegraph:
Car sales in Europe at lowest level since 1995
- New registrations fell 1.7pc in 2013, the sixth consecutive year of decline, although sales picked up at the end of the year
Car sales in the European Union were at their lowest level for 18 years in 2013, as slumps in certain crisis-hit eurozone states outweighted an improvement in other countries including the UK.
New registrations fell by 1.7pc to 11.9m, according to ACEA, the European Automobile Manufacturers’ Association. This was the worst level since ACEA begin recording data for the enlarged EU in 2003, and the worst for the block of 15 European countries the body had previously measured since 1995.
Car sales have slumped since the financial crisis and are now 26pc down on 2008, although sales rebounded towards the end of the year as the eurozone exited recession.
Disestablishmentarianism from EUobserver:
MEPs call for dismantling of EU bailout ‘troika’
The “troika” of international lenders, which sets the terms of eurozone bailouts with little or no democratic oversight, should be replaced by an EU system which is accountable to the European Parliament, MEPs say.
“All European instruments that are not based on EU law are provisional. EU instruments should be based on the community method, with the European Parliament acting as democratic legitimator and control body,” Austrian centre-right deputy Othmar Karas told press in Strasbourg on Wednesday (15 January).
Karas is drafting a report together with a French Socialist colleague, Liem Hoang-Ngoc, on the work of the troika.
Gimme shelter from New Europe:
MEPs ask for an EU wide strategy for the homeless
The MEPs once again asked from the European Commission to form an EU-wide strategy for the homeless.
On 16 January, the MEPs adopted a resolution asking from the Commission to finally establish a European strategy for the homeless. According to the resolution adopted by 349 votes to, 45, with 113 abstentions an EU homelessness strategy should focus on housing, cross-border homelessness, quality of services for the homeless, prevention and homeless young people. According to the MEPs even though the responsibility for tackling homelessness lies with EU countries an EU strategy for the homeless must have a complementary role to play.
The European Commission has already acknowledged that homelessness levels have risen recently in most parts of Europe and the crisis seems to have aggravated the situation. Moreover, the profile of the homeless population has been changing and now includes more young people and children, migrants, Roma and other disadvantaged minorities, women and families are increasingly at-risk of homelessness.
Another new record from EUobserver:
Poverty in Europe at ‘unprecedented levels’
EU social affairs commissioner Laszlo Andor told MEPs in Strasbourg Thursday that poverty in Europe is at an all time high. “Poverty has risen in Europe, mainly in the more peripheral countries and regions, reaching unprecedented levels among those who are more vulnerable, such as homeless people,” he said.
More Banksters Behaving Badly from The Guardian:
HSBC and Citigroup suspend foreign exchange traders amid rigging probe
- US regulators arrive in London to step up joint investigation with Financial Conduct Authority into alleged market manipulation
HSBC and Citigroup have both suspended foreign exchange traders as a global probe into possible currency market manipulation intensified.
Regulators from the United States arrived in London this week, stepping up an investigation in which they are working with Britain’s financial watchdog, the Financial Conduct Authority, to determine whether traders at some of the world’s biggest banks colluded to manipulate the $5.3 trillion-a-day (£3.2tn) foreign exchange market.
The investigations centre on senior traders’ communication of client positions via electronic chatrooms, which also featured prominently in a probe into the rigging of a key interest rate known as the London interbank offered rate, or Libor.
Sky News bubbles selectively:
House Prices ‘Risk Becoming Unsustainable’
- A report warns of the consequences of the growing gulf between homes for sale and demand in some areas of the UK.
Surveyors have warned that house prices risk becoming unsustainable in some areas because low home supply is failing to meet high demand in the market.
The Royal Institution of Chartered Surveyors (Rics) measured the strongest level of sales in six years ahead of Christmas.
Its report predicts prices will rise by 5% on average in each of the next five years but warns that a lack of properties for sale risks people paying far more than market value to secure a home.
From The Independent, so much for du seigneur?:
Calls to abolish outdated rights for lords of the manor that ‘serve no purpose in the 21st century’
- The title is a hangover from the feudal era and does not automatically bring with it physical property, but entitlements and duties that would have once been held by a medieval seigneur are often included
And along that line, one of those entitlements or duties? From the London Times:
Fancy-dress dogging on duke’s estate upsets villagers
Police have been called to an aristocrat’s estate to crack down on sex parties involving groups of men dressed in fairy wings, tutus and PVC.
The Badminton Estate, owned by the Duke of Beaufort, is being plagued by groups of men congregating in farm buildings in fancy dress.
Nick Bush, a tenant farmer, asked the police to intervene after battling in vain to deter the men.
RT bets on the come line:
UK worsens global hunger crisis by ‘blocking reforms on food speculation’
The UK is being accused of attempts to block EU reform to prevent food speculation. It took EU negotiators three years to agree on a regulation against speculation by banks and hedge funds which drives up food prices, aggravating the global hunger crisis.
The deal introduces new rules to limit speculation on products linked to what people eat, such as wheat, corn, soybeans or sugar. The new controls will set limits on the number of food contracts that banks and other finance institutions can hold, pushing traders to open their activity to greater public scrutiny.
Representatives of the EU’s 28 governments and EU lawmakers clinched the deal on the outlines of the Markets in Financial Instruments Directive (MiFiD) in Strasbourg late on Tuesday. The bloc’s executive arm, the European Commission, has promised that the rules on agricultural derivatives would “contribute to orderly pricing and prevent market abuse, thus curbing speculation on commodities and the disastrous impacts it can have on the world’s poorest populations.”
An Irish booster shot from Independent.ie:
Moody’s upgrades Ireland to Investment Grade after bailout exit
- RATING agency Moody’s has upgraded Ireland’s government debt from “junk” to higher quality “investment grade” status.
International money markets reward Ireland with low interest rates, bailout chief says
The country is now regarded as a lower risk investment by all of the main credit agencies for the first time since 2011.
Finance Minister Michael Noonan said the move will help to lower borrowing costs for companies and individuals.
Norwegian anxieties for naught from TheLocal.no:
Norway’s open border brings few Romanians
Norway has seen few extra Romanians and Bulgarians since it lifted border restrictions at the end of 2012, belying fears in the UK of a floods of migrants.
The richest country in Europe with a generous welfare state, Norway could be expected to be a top draw for low-salaried Eastern Europeans.
But between January and December 2013, it saw just 4,904 Romanians and Bulgarians registering for work using their European Economic Area (EEA) citizenship, a rise of just 24 percent on the year before, when they needed to apply for special work permits.
Amsterdam next, with a not of disapproval from DutchNews.nl:
Dutch business leaders slam cabinet polices, support at record low
Dutch business leaders are extremely unhappy with the current right-left coalition’s policies and think the cabinet is failing to tackle the crisis.
Employers’ organisation VNO-NCW questioned 471 company bosses about their attidudes to the VVD-PvdA government and current policy. In total, the cabinet scored just 4.9 out of 10 – a record low according to the Telegraaf.
Prime minister Mark Rutte was rated 5.4, well below most of his senior ministers. Top ranked minister was finance chief Jeroen Dijsselbloem, who scored 6.6.
Germany next, where TheLocal.de restores a commons:
Hamburg buys its energy grid back for €400 million
Energy giant Vattenfall said on Thursday it had “unwillingly” agreed to sell the electricity grid in Hamburg back to the city, as approved by a referendum last year.
The value of the transaction, still to be determined, is expected to be about €400 million. Vattenfall has a 74.9 percent stake in the electricity grid company, Stromnetz Hamburg, while the remaining 25.1 percent belongs to the German city.
“The value of the entire electricity grid company has preliminarily been agreed at €550 million euros,” the Swedish company said. “However, both parties have agreed on a minimum value of €495 million.”
France next and the origin of the feces from TheLocal.fr:
Tonnes of dung dumped at French parliament
As if President François Hollande didn’t have enough crap to deal with right now, protesters sent tonnes more his way on Thursday when they dumped a lorry-load of manure outside the French parliament.
Weeks after hundreds of chickens were let loose, several tonnes of steaming dung were dumped from a lorry in front of the parliament building on the Quai d’Orsay on Thursday morning during what French police termed “un attentat à la crotte” or “poop attack”.
The lorry carried a simple message to President François Hollande and his buddies in parliament: “Hollande and the political class should get out, make way for the Fifth Republic”. The driver was arrested soon after dropping the steaming cargo.
Spain next, and another austerian demand from El País:
Eurogroup and EC insist Spain needs second round of labor reform
- EU commissioner Rehn says Brussels engaging in “constructive dialogue” with Rajoy government on the issue
The president of the Eurogroup, Jeroen Dijsselbloem, on Thursday reiterated calls for Spain to undertake a second round of reforms of the labor market in order to strengthen the country’s recovery from a deep recession.
As Dijsselbloem himself told reporters during a visit to Beijing accompanied by the European Union commissioner for economic and monetary affairs, Olli Rehn, he had already made a speech in Madrid in October along the same lines. “New labor reforms will work, not only in Spain, but also in other countries,” he said.
In a report released in December, the OECD also suggested that severance pay remains high in Spain and that more cuts were necessary to tackle high unemployment, which currently stands at 26 percent.
The labor reform introduced in February 2012 cut severance pay for permanent workers from 45 days of wages for each year of service to 33 days, and the maximum amount from 42 months’ salary to 24 months. It also introduced a series of so-called “objective causes” such as falling sales and technological and organizational changes that allow companies to lay off workers en masse with severance pay of only 20 days’ wages for every year worked, up to a maximum of one year’s salary.
From EurActiv, schismatic:
Spanish ruling party rebels launch new conservative party
Rebels from Spain’s ruling conservative People’s Party launched a new political party on Thursday (16 January), hoping to tap into public discontent over sky-high unemployment, graft scandals and surging separatism in Catalonia.
Leaders of the new party, named Vox (voice in Latin), accuse Prime Minister Mariano Rajoy of being too soft on Catalan and Basque separatism and of breaking election promises by, for example, raising taxes.
“Millions of Spaniards … feel abandoned by the political system, which is infested with corruption scandals and at the beck and call of private interests,” Santiago Abascal, a former PP member on the Vox executive committee, told reporters.
More schismatics from El País:
Catalan assembly approves motion to seek leave to hold self-rule referendum
- Three Socialist lawmakers break with party line to vote in favor of proposal
“We are not voting on the political future of Catalonia, but the form in which Catalans will decide it”
The Catalan regional assembly on Thursday approved a motion to ask the national Congress for permission to hold a referendum on the independence of the region from the rest of Spain.
The proposal was approved by members of the ruling center-right nationalist CiU bloc, the Catalan Republic Left (ERC) and the ICV leftist-green group. Three members of the Catalan branch of the main opposition Socialist Party (PSC) broke ranks to vote in favor of the motion, while the center-left Candidature for Popular Unity (CUP) abstained. The conservative Popular Party (PP) and the centrist Citizens party voted against.
TheLocal.es gets going:
Spain’s expat exodus continues
Spain lost nearly 200,000 registered foreign residents in 2012 as the country’s economic crisis continued to bite, official figures released on Friday show.
The new figures from Spain’s National Statistics Institute (INE) highlight the continuing fall in the number of registered foreign residents in Spain.
According to the data, there were 190,020 fewer foreigners registered with Spain’s local town halls on January 1st 2013 than on the same date a year earlier.
While these figures fail to take into account the huge number of foreigners in Spain who fail to register on their local civil register (padrón), the decline suggests many people are leaving because of the country’s economic crisis
And thinkSPAIN tracks turmoil:
Burgos burns as boulevard riots leave 40 in custody
VIOLENT protests in the central Spanish city of Burgos over controversial works on a main boulevard have led to 40 arrests and widespread damage.
Five days of riots, with wheelie-bins set alight and bottles smashed as well as physical fights have blackened the otherwise peaceful and picturesque city’s landscape – but as yet, calls for the work to stop have not been answered.
Some 8,000 residents have formed a working party to fight plans to spend in excess of eight million euros on revamping the C/ Vitoria in the Gamonal neighbourhood, money they feel could be better spent on public services.
On to Lisbon and a boost from El País:
S&P removes threat to further cut Portugal’s debt rating
- Agency sees growing signs of economy stabilizing
Standard & Poor’s on Friday affirmed its junk-status BB rating for Portugal’s long-term sovereign debt after withdrawing a threat to further downgrade it, but maintained its negative outlook on the rating.
Portugal is aiming to successfully exit its 78-billion-euro bailout program later this year and return to the long-term debt markets. The IGCP debt-management arm of the government successfully tested the waters last week with a 3.25-billion-euro issue of five-year bonds
S&P said it expects the center-right Social Democrat-led coalition of Prime Minister Pedro Passos Coelho to have met its deficit-reduction target of 5.5 percent of GDP last year and make progress on achieving its 4.0-percent target for this year.
Italy next, with diplomatic debauchery from TheLocal.it:
‘Bunga bunga’ claims hit US consulate in Italy
An ex-employee of the US consulate in Naples has claimed her former boss slept with his staff and gave prostitutes free access to the property, Italian media has reported.
Kerry Howard, who worked at the consul until 2012, said she was forced to quit after whistleblowing about the behaviour of former Consul General Donald Moore.
During his time in Naples, Moore allegedly slept with a number of staff and prostitutes, Il Sole 24 Ore reported. The diplomat also allegedly gave the women the code to enter the consulate at night without being detected.
“Women are like candy, unwrap them and throw them away,” Moore was quoted as saying.
Retro racism from The Independent:
Italian MP Gianluca Buonanno ‘blacks up’ to deliver racist anti-immigration rant in parliament chamber
- Northern League politician asks parliament whether people needed to ‘go around painted black’ in order to receive state benefits
An Italian MP has “blacked up” to deliver a staggering anti-immigration rant in the country’s parliament, smearing his face from a makeup pad and asking whether “we need to be a bit darker” to get benefits from the state.
Gianluca Buonanno, a politician with the right wing Northern League party, took the opportunity on Wednesday night to criticise “latecomers” and “non-EU” citizens who receive pensions despite, he claimed, having “never worked a day in their lives”.
Looking for the Toxic Avenger with Spiegel:
The Mafia’s Deadly Garbage: Italy’s Growing Toxic Waste Scandal
For decades, the Mafia has been dumping toxic waste illegally in the region north of Naples. Recently declassified testimony shows that leading politicians have known about the problem for years, yet done nothing about it — even as the death toll climbs.
After the jump, Greek crimes and crises, Ukrainian repression, Latin American violence, Indian inflation, Thai violence, Chinese “reforms,” environmental woes, and Fukushimapocalypse Now. . . Continue reading