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Archive for August, 2010

Happy Birthday to Us

It should tell you how we roll around here that it took someone else to remind us that Meck Deck is five years old today.

Wow. Almost 9500 posts have zipped by. Hope we’ve done some good. If not, maybe we can start to make up for that. Let’s get this party started.

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Meanwhile, in Miami

City government is broke and refuses to admit it. Instead Miami residents are getting slammed with tax and fee hikes.

At the same time layoffs loom for city workers.

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Billion-Dollar Stadium Sighting in LA

Check this out. The NFL’s next billion-dollar stadium may land in Los Angeles in time for the 2018 or 2022 World Cup finals. Minor requirements — waving California’s strict air quality rules and sticking the taxpayers with the bill for at least part of the complex.

I figure Jerry Richardson will be well on his way to a stadium upgrade by then.

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DNC 2012: They’re Bribing Kids in StL

Sign on to attend failing public schools in St. Louis — and if you hit attendance and behavior goals — you get $300. Or rather your family does.

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Liquor Woes in Indian Trail

Oops. Voters approved liquor-by-the-drink in the Union County burg just last year and the town already has its first alcohol scandal. The Enquirer-Journal reports that the owner of the Bear’s Lair near Sun Valley High School has been charged with with one count of possession of non-tax-paid alcohol and one count of transferring a mixed beverage tax stamp.

You may remember Theresa Jacob-Allen as the ex-candidate for mayor and the wife of town Councilman Robert Allen who sued her husband accusing him of having a sexual relationship with fellow Councilperson Darlene Luther before the pair separated. Jacob-Allen also has an alienation of affection lawsuit pending against Luther.

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ProPublica Discovers Can-Kicking

There is nothing obviously wrong with ProPublica’s loong rundown on the CDO implosion. Functional overview — and evidently particularly pleasing to the UPoR crowd as the piece focused on evil-bad Merrill Lynch and Citigroup without mentioning the Uptown white hats at BAC and the former Wachovia — but nothing actually new in it.

What struck me though was the premise that the banks and financial houses should have just taken it on the chin once the housing market started to saturate in 2006-07. Not create CDOs to buy the CDOs which buy mortgages. OK then. So the banks should have stopped lending to dicey risks, housing prices should have been allowed to self-correct, and no massive federal bailout? Really. Because that is what some of us said should have happened as it went down, in real time. Now in 2010 ProPublica rides in to say kicking the can down the road in 2007-08 was wrong, it “super-charged” the pain.

Another question: What to make of the Federal Reserve’s qualitative easing then, ProPub? Isn’t having the Fed buy up every bit of dicey debt the Treasury spits out the ultimate in “self-dealing” which will “super-charge” a future financial crisis? Finally — and sorry to those of you who see this coming:

Faced with increasing difficulty in selling the mortgage-backed securities that had been among their most lucrative products, the banks hit on a solution that preserved their quarterly earnings and huge bonuses:

They created fake demand.

What is Keynesianism but the creation of fake demand? Is the fakery OK if it merely keeps politicians in office rather than cuts bonus checks? Help me out here ProPub. Because otherwise it seems like financial illusion is virtue when practiced by government.

Update: I guess I should spin out the irony of this piece failing to mention Wachovia’s role in the financial implosion as ProPublica is only funded by — Wachovia. Via the Golden West Foundation’s “super-charged” pre-implosion checks of about one billion dollars. Golden West being the $25b. fraud that laid Ken Thompson low, cratered Wachovia, shed tens of thousands of local jobs, sank the net worth of so many local investors etc.

Come to think of it maybe there is something fundamentally wrong — and self-serving — with this account of CDOs. At least for readers in Charlotte.

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County Loses 3000 Jobs in Month

And the Charlotte region lost a staggering 23,000 for July, according to state employment commission numbers. Put another way, absolutely no progress has been made on the jobs front in Mecklenburg County this year.

For 2009 the monthly county unemployment rate averaged 10.8 percent. So far across the first seven months of 2010 — the average is 10.9 percent. Even more ominous is that the county is back down to 410,789 total jobs, a drop of 5000 since May and 30,000 short of pre-recession peaks. The workforce is back under 460,000 again, or fully 13,000 short of its peak. Total unemployment in the county remains stock still at 49,075. That number would have to be cut in half for there to be a full jobs “recovery” in Mecklenburg.

Needless to say, consumer spending and hence local sales tax revenue is not going to recover with that many jobless out there.

Bonus Observation: Gold star for Kirsten Valle for finally writing about the local economic landscape and not talking to upside speculator Mark Vitner. His relentless shilling for Charlotte has rendered him useless in assessing the real local economy. More grounded, local Federal Reserve economist Rick Kaglic, who looks at the economic situation and declares: “It’s hard to find what you would actually call a bright spot.”

Update: Gold star deleted. See comments.

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CMPD Seeks Probationer in Shooting

Huh?

Tony Maurice Knox, 32, is wanted by CMPD in connection with a shooting Friday evening. State corrections records indicate that Knox was sentenced to 30 months probation in February 2009 for two felony convictions, the result of four felony charges from February 2008.

In other words, Knox’ probation officer is supposed to know his whereabouts until August 2011.

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Southwest to Newark

The three significant announcements and one non announcement from Southwest Airlines in recent weeks:

• Southwest yesterday announced a major addition to its route network: Newark. Flights should begin March, and the airline expects to be operating 18 flights a day by June 2011.

•The airline also ordered 25 more 737s last month. At the time they claimed that the extra planes would be used simply to replace older aircraft on a one-for-basis. That could still easily turn out to be correct, but it’s also the first step towards growing the fleet.

• Southwest is looking at bigger planes. It currently flies mainly 137-seat Boeing 737-300 and -700s but now is interested in possibly taking some of the larger -800 as well, which would seat about 175 in their typical seat density. Southwest’s flights are fuller then they’ve ever been before, which explains their sudden interest in the -800.

• No word yet on exactly when Southwest will begin flights to Greenville-Spartenburg or Charleston.

So how does at this impact if/when Southwest comes to the CLT? Good question. For the past two years, Southwest hasn’t grown their fleet but rather has shifted capacity from weaker routes to add new destinations. This has resulted in their planes being fuller than ever. If the economy improves at all, Southwest will have some significant internal growth possibilities with not all that many additional aircraft coming in. Southwest now may have just cautiously begun adding capacity, which should improve Charlotte’s chances of attracting the airline eventually — all other things being equal. Still no reason to think it’s imminent. The low hanging fruit is probably Cincinnati or, if they’re so inclined, any number of Charleston-sized markets.

Bonus non-Southwest updates and things:

• US Airways adds flights and destinations from LaGuardia. More proof the Delta/US Airways slot swap is dead but this also highlights the role that LaGuardia can play in US Airways’ network as a regional hub. And the more that LaGuardia handles, the less likely it is that flights to secondary northeast destinations might come to CLT in the future. The airline also noted that its LaGuardia operations were marginally profitable in the second quarter.

• Albuquerque wants more air service. It doesn’t have nonstop flights to Charlotte, US Airways’ largest hub. Albuquerque’s list of targeted destinations they’d like to add includes Burbank and San Jose, CA, Detroit, and Boston but not Charlotte. OK.

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Butler Football Player Charged with Rape

kkCarolina Weekly reports that Osvaldo Sombo, 17, was arrested and charged with rape on August 11th. Sombo made bond and played for Butler in its season-opening game on August 20th. Butler head coach Mike Newsome told the paper last week that he did not know Sombo had been arrested and charged.

llCMS is now investigating the matter, but is not talking.

Sombo was a force in Butler’s hard-fought 27-14 win over Mount Tabor, notching three sacks and seven tackles. The 6-2, 220 OLB/DE was an all-conference player last season for East Meck.

Mecklenburg County jail records indicate that Sombo was charged with two felony counts of second-degree rape and one misdemeanor count of sexual battery. He was released on $103,000 bond.

Update: The UPoR tip-toed into covering this story on Sunday — but without Langston Wertz. Newsome and CMS are not talking.

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