State Government - The Economy - The Governor - Barack Obama - U.S. Economy - U.S. Government

California continues to march to the edge of the abyss. The statistics I have seen from Pew Resarch scares the daylight out of me. California's current budget deficit as a percentage of the general fund is estimated to be at 49.3% of the general fund. The numbers I have seen are at 21 Billion Dollars according to a report on PublicCEO.com. It is just as bad in Nevada, which I just visited. It is estimated to be at 37.8 Percent of the general fund.

I have always believed that California is a leading indicator of what is going on in the Country as a whole. Although I think that California will be back, it will be quite a while. An indication of the steep climb California has is what happened with the University of California System. The UC trustees just approved a 32 percent tuition hike for students along with some massive budget cuts. With the steep cuts, I see these folks cutting the legs from under future development. I see the continued evolution to be such that Education may end up belonging to the rich and the well-off. Some may not think Education to be a Civil Right, but it seems to me that if there is anything that would help guarantee a reasonable future is Education. My own local school district is dealing with a 25 Million Dollar deficit. The School Board has decided to balance this budget by going after teacher salaries and pensions.

The national picture is ever more dire. The President came out with a dire warning about the deficit. Probably, it was to prepare the country for a tough budget that may continue to fuel the rage that guys like Beck push their comments everyday on Fox. This battle is yet to be won.

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Posted By: Mike Pouraryan - Category: California, State Government, The Economy, The Governor, Barack Obama, U.S. Economy, U.S. Government

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Green Shots: Myth vs. Reality (Cont'd)

May 16th 2009 03:40

: The Terrain is scary.....

Workers continue to be worried as reports of layoffs and missed earnings keep coming. One such law in California to at least help mitigate the shock is the California Worker Adjustment and Retraining Notification Act. The so-called WARN ACT requires certain employers to give affected employees at least 60 days advance written notice of an intended plant closing or mass layoff. 147 companies will either have a mass layoff or an outright plant closing during this month alone. For instance, in January 2009, a major regional hospital in Orange County California filed to shut down with some 500 employees. Things continue to move in the wrong direction.

As for the sickly auto industry, I reported on the drastic measures being taken by Chrysler to pare its' dealer network. When the folks are not buying the cars, there is no reason to support such a extensive network. My initial estimate of the number of jobs lost was apparently way understated. The estimated job losses are slated to be around 38,000 people. GM is also right behind Chrysler. They are cancelling 1100 dealer contracts. The National Automotive Dealers Association is politically connected. After the dust is settled, only the major players (Penske, AutoNation) will survive. All others will fall by the wayside.

I began my business career in the Auto Industry. I knew then that the dealer network and the infrastructure could not sustain itself. As I left to move on to other industries, I saw the rise of the mega-dealers that ultimately resulted in companies like the AutoNation and Penske. This "corporate-owned" dealerships meant that the way in which vehicles were sold and serviced were going to change. The evolution has been nothing less than revolutionary. The car can be designed online and customized as appropriate. It is a continued sign of things to come.

Despite profound reservations expressed by many "pundits", I think that the U.S. Economy continues to be the lynchpin of the world. Americans are indeed vying to put their own financial house in order. The fact remains that we continue to have a demand deficit because the banks are not lending and will not lend for a while longer. The so-called Stress Test showed a hole that will not be able to be overcome for a while yet.
As such, we will need to continue to fight the fires with eveything at our disposal. There is no option because failure is not an option.

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Posted By: Mike Pouraryan - Category: California, State Government, The Economy, The Governor, Barack Obama, U.S. Economy, U.S. Government

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The Continued Econmic Winter of Our Lives

April 5th 2009 03:48

: Is there any hope?

The numbers that came out on Friday on the U.S. Unemployment numbers were shocking. It went up "officially" to 8.25%. But, according to the Bureau of Labor Statistics Report, it did not include, "...About 2.1 million persons (not seasonally adjusted) were marginally attached to the labor force in March, 754,000 more than a year earlier. These individ-
uals wanted and were available for work and had looked for a job sometime in the prior 12 months. They were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey. Among the marginally attached, there were 685,000 discouraged workers in March, up by 284,000 from a year earlier. Discouraged workers are persons not currently looking for work because they believe no jobs are available for them. The other 1.4 million persons marginally attached to the labor force in March had not searched for work in the 4 weeks preceding the survey for reasons such as school attendance or family responsibilities."
(Source: Really]Really Long Link retrieved April 4, 2009).

The report from the U.S. Department of Labor is quite profound because it says in no uncertain terms that the real unemployment rate is signifciantly underreported. The actual real unemployment rate is around 14.8% nationally--some 23,000,000 Workers in the United States alone. Furthermore, There is of course the fact that there were folks who were ready to take on full time employment, but ended up taking up part time employment. According to the reports I have reviewed, the nominal rate is expected to rise up to 10% nationally before it starts to ebb off. In states such as California, it is bound to get worst.
Just Friday, FedEx annouced job cuts of 1,000 because of the earnings shortfall. I was also shocked at the report of over 30,000,000 (30 Million) people being on Food Stamps. That's almost 1 in 30 Americans. For a country that is the bread basket of the world, this is a figure that in my view is shameful!!!

The budget blueprint that the U.S. Congress passed on Friday is a budget that is staggering in numbers. The Republicans have attacked it as spending and borrowing too much. Although I'll be continuing to assess the budget blueprint and the subsequent debate, one thing has to be noted that this blueprint includes the costs of the wars in Afghanistan and Iraq. Furthermore, it includes other off-budget items which were not included in the Budget of the Bush Years. With such immense problems on all fronts, there is no question that the challenges are huge. Although the Obama Adminstration assures the Country and the World that the budget blueprint is the foundation for economic recovery, it does not seem to factor in the almost Twelve Trillion Dollars in Guarantees that the U.S. Federal Reserve and the Treasury have committed as part of their quest to "cleanse" the Financial System.

The markets seemed to have a good day last week after the G20 came out with its' comminque, where it committed to increasing the IMF funding by One Trillion (one Trillion Dollars). I agree with Martin Wolfe's Admonition when he noted that, ".....Finding a longer-term cure for chronic global excess supply lies ahead." (Source: http://www.ft.com, retrieved April 4, 2009). Not withstanding the apparentl "success" at the G20, the Chinese will not be silent as they push for a move away from the Dollar as the World's reserve currency. They have a lot of pull because they own over a Trillion Dollars worth of U.S. Treasury Debt and are concerned.

On the domestic front, I have been assessing the monies from the Economic Stimulus is starting to flow to the States. I am anxious to see the immediate impact. I am especially keen to see how the $ 11 Billion slated for California is going to be allocated to the 1000 School Districts who are facing severe budgetary constraints, have sent out layoff notices and will be going through further cutbacks. I am also keen to see that the promised benefits for so-called "shovel-ready" projects and the windfall it is to provide. The Recovery.Gov website is reporting on monies continually being released. It is the impact that would be the driving force.

The struggle continues.......

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Posted By: Mike Pouraryan - Category: California, State Government, The Economy, The Governor, The Presidential Election, Barack Obama, Joe Biden, U.S. Economy, Big Media, U.S. Government, Congress, The Judiciary, Executive

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Eyes Of the World are on London.....

April 2nd 2009 01:43

: And???

The G20 Class of 2009

The World's top 20 countries have desended upon London. London has braced itself for anarchy. Anyone who does not understand the anxiety felt by the people of the world seems to be living in fantasyland

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Posted By: Mike Pouraryan - Category: Germany, Russia, United Kingdom, Inter-Faith Relationships, California, State Government, The Economy, The Governor, The Presidential Election, Barack Obama, Joe Biden, U.S. Economy, Big Media, Big Oil, Lehman Brothers, Ross Perot, U.S. Government, Congress

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Recovery.Gov: The First in a Series of Comments

March 15th 2009 04:06

: California's Take

I wrote about the profound concerns about the California Budget. I wanted to assess how the new stimulus plan will help California. California, for instance, is slated to receive around 11 Billion in Educational Funding alone. Funds are starting to be distributed. I am particuarly keen to understand how the 11 Billion Dollars slated for California is going to trickle down to the local level.

Right now, the Capistrano Unified School District in Orange County, California is faced with a 38 Million Dollar Deficit. They are slated to make substantial cuts. According to the California Teachers Association, Twenty Six Thousand Teachers were slated to receive pink slips. As California has already launched its' companion website, available at: http://www.recovery.ca.gov/, I will be looking into the 11 billion dollars and how it is going to be spent

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Posted By: Mike Pouraryan - Category: California, State Government, The Economy, The Governor, Barack Obama, U.S. Economy, U.S. Government, Congress

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Outsider Views Economic Winter Chronicles (Feb 8, 2008): A Personal Perspective

February 8th 2009 17:39

: How scary will it get? I just don't know.....

The debate on what to do about how to jumpstart the US Economy rages on. I personally have received appeals from both Senator McCain's new CountryFirst PAC and President Obama's Organizing for America Organization. The roundtable held earlier between four leading lights of the U.S. Congress on NBC's Meet the Press underscores this divide.
As the debate continues, teachers, fire fighters and cops are on the chopping block. States are in dire straits. California continues to operate without a budget.

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Posted By: Mike Pouraryan - Category: Hydro, Nuclear, Solar, California, State Government, The Economy, The Governor, The Presidential Election, Barack Obama, Joe Biden, U.S. Economy, Big Media, Big Oil, U.S. Government, Congress, The Judiciary, Executive

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Outsider Views Economic Winter Chronicles (Feb 6, 2009 Edition)

February 5th 2009 05:24

: ..and the hits keep on coming.........

In my almost daily columns/comments on the Economy, I had thought about the calamity as a Tsunami. With a Tsunami, there is at least a chance to see Sunshine. However, I think the better term for it is a Winter Storm. I continue to wonder when we will see sunshine.

On Wednesday, the bleeding continued. Cisco Systems, the leading network gear maker, missed the numbers. Alcatel-Lucent continued its' downward slide which has been on-going for a number of years. Disney missed then it came out with its numbers and annouced jobs cuts totaling some 400 workers at the ABC unit. Earlier in the week, Electronic Arts annouced a job cut and delay in new games

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Posted By: Mike Pouraryan - Category: California, State Government, The Economy, The Governor, Barack Obama, John McCain, U.S. Economy, Big Media, U.S. Government, Congress, The Judiciary, Executive

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Outsider View's Economic Tsunami Chronicles (Feburary 2, 2009 Edition)

February 2nd 2009 06:56

: The Bad News Gets Worst!!!

The new month continues the bad news we have been subjected to since mid-2008. Right now, Ryannair has posted a loss of 130 Million Dollars for the final 3 months of 2008. Ryannair is oen of the leading budget airlines in Europe, based in Ireland. Going around the world to China, China has just come out with a report noting that some 20 million Chinese workers no longer have jobs to go back to. According to the statistics reported, this represents 15% of the workforce.

As the flow of red ink and bad news continues, we have the give and take in Washington. There is at least consesus that something has to be done. But, states and local governments in the United States continue to suffer. The Governor and the Legislature are continuing their game of political football. This is the California Governor's Take on this

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Posted By: Mike Pouraryan - Category: California, State Government, The Economy, The Governor, Barack Obama, U.S. Economy, U.S. Government

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Davos: Reflections

January 30th 2009 05:43

: Wow!!!!

The world is right now fascinated with Davos. The rich, the famous and the powerful are all there in paradise talking about the world and all the problems. There is enough being said by all pundits which will speak for itself on Davos. But, two key things occured which I wanted to note:

1) Turkey's Prime Minister Edrogan stormed out of a discussion with Shimon Peres during discusisons on Gaza. Edrogan was given a minute by David Ignathius of the Washington Post to rebute a lengthy comment by Shimon Peres. I think the gesture by Mr. Edrogan must be taken seriously by Israel. It shows the frustration with Israel and the fact that as Amr Mousa said, Israel "does not listen". I was quite disappointed by David Ignathius when he did not grant equal time during the discussions. It seems to me that Dinner could have waited

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Black Friday......

October 4th 2008 16:48

: Tough Times......

As the Bailout package was debated in the House yesterday, here is just a sampling of the news that was coming out:

1) 159,000 Jobs were lost in September

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