US Housing defaults rise again, City budgets hit , and bankruptcy looms as reduced Property tax incomes cut State employee retirement benefits

Realty Trac report today that default notices, auction sale notices and bank repossessions — were reported on 243,353 properties in the US which shows nationwide ;

1. A 4 % increase from the previous month
2. A 65 % increase from April 2007.
3. This represents about 2% of the total number of households in the US.

Nevada, California, Arizona continue to see the highest rates of foreclosure, with Nevada still highest, leaving one in every 146 Nevada households in April having a foreclosure filing, nearly 4 times the national average nearly and double the rate in April 2007.

California with 64,683 reorted filings came second , slightly down in numbers from March but 112 % up from April 2007.

6 California cities feature in the Nations Top 10. Merced took the top spot, followed by Stockton at No. 2, Modesto (3rd) Riverside-San Bernardino (4th) ,Vallejo-Fairfield (6th) Bakersfield (8th) - site of the ill fated Lehman / Sun Cal backed McAllister Ranch debacle. see Wednesday, June 11, 2008 Lehman Brothers investments exposed as losses pile up..Alpha female CFO Ms Erin Callan NYPD cop's daughter's is on the case (leaving Florida cities Cape Coral-Fort Myers (5th), Port Lucie-Fort Pierce (9th) Fort Lauderdale at No. 10.

Arizona showed accelerating foreclosure activity with a monthly increas in April of 26% a total increase of 181 % from April 2007,

Not only do foreclosures slow sales and depress prices it can affect Property Tax incomes , putting municipal budgets in peril. For example, the city council in Vallejo, California - with the nation's 6th highest foreclosure rate in April , and facing a projected US$16 million deficit in the fiscal year 2008-09 (commences July 1st) voted unanimously on May 7th to have the city file for bankruptcy. Which they did, on May 27th (City Press release)

Chapter 9 bankruptcy allows the city to gain temporary protection from creditors whilst allowing the city to continue to offer citizens necessary services.

The bankruptcy process will however $750,000 to $2 million in legal fees alone, city officials said.

More California cities may file for bankruptcy because they face the same toxic mix of falling tax revenue, rising payroll expenses and a slumping housing market . "I don't think Vallejo is unique," said Mark Levinson, a bankruptcy attorney hired by Vallejo. "Vallejo is not the only city in California or the U.S. that is saddled with employee contracts that are burdensome."

Vallejo promised its employees salaries, benefits and retirement packages that it simply cannot pay, signing generous labour contracts during economically flush times, claims Marcia Fritz, vice president of the California Foundation for Fiscal Responsibility

Governor Arnold Schwarzenegger asked Gerald Parsky ( he served as the California campaign chairman for President George W. Bush in 2000 and 2004.) of Los Angeles, former chairman of the UC Board of Regents to head a bi-partisan gubernatorial commission - Public Employee Post-Employment Benefits Commission - that studied California's public pension and healthcare liabilities. Parsky's firm, Aurora Capital Partners, also happens to invest $150 million for CalPERS, which just happens to be one of the world's largest pensions.

After 12 months looking at the California's liabilities they reported in January that their unfunded obligations were a jaw dropping US$118 billion for retiree healthcare -- the state of California was on the hook for US$48 billion -- plus US$63.5 billion for pensions.(Full report pdf) pensions were funded up to 89% , they were 119% funded in 2000.

Last month Schwarzenegger ordered his finance director, Mike Genest, to find a way to pay down the state's $48-billion unfunded healthcare obligation over a 30-year period without "raising taxes or dipping into the state's general fund." Genest estimates it will cost the state an extra $1.1 billion annually to fully fund retiree healthcare. It's already kicking in $1.6 billion, plus $4 billion for pensions.

As a small aside the Parsky report recommendation 28 has widespread utility worldwide...

Which means, don't trust the actuaries, investment analysts, brokers, and check every assumption and calculation they make to arrive at their conclusions. Many (if not all) listed UK companies underfunded pensions to boost profits, share prices and Director's share option and bonuses.

At Appendix 3 Page 231 they even provide a through 16 page handy guide, "How to read an Actuarial Valuation" ...which is recommended reading to anyone with a Pension of any sort.

...and Lord Patel wished he had been able to read a copy about 15 years ago.

Jeane Palfrey puts up her telephone List (for sale ?) on her website - her Podcast link

STOP PRESS Monday 9th July - Telephone Records NOW available FREE - Link

Jeane Palfrey's website has just posted that anyone can apply for her telephone records, released by Judge Kessler yesterday. Her e-mail address is mbsibleydjp@civilforfeiture.com

Reuters has a story today, "Accused D.C. "madam" offers phone records to media" in which they say that she is makinga pre-c0ndition requiring recipients of the phone records to comply with several conditions, including one stipulating that the numbers not be published, traded or sold to third parties.

They must also agree not to disclose the identity of any woman who worked for Palfrey's business without first obtaining the woman's permission.

How soon before the MSM get stuck into this story ? The Miami Herald already has a story

''It is my patriotic duty to release these records,'' Palfrey told the New York Daily News.

But Palfrey, who faces federal racketeering charges for running what she insists was a legitimate escort service, said she will give only ''coded'' copies of the list to ''responsible'' reporters, bloggers or private detectives who promise not to put them on the Internet.

Palfrey expects to unveil up to 100 customers who risked national security, ''violated the public trust'' or were hypocritical consumers of her company's prurient services.

''These are the real power movers and shakers in Washington,'' she said.

``The rest of them I hope to leave the hell alone. I don't want to destroy the lives of the other 9,900 clients or the lives of the girls.

Raw Story picks up on an interview with the Vallejo Times, Palfrey (who live in Vallejo CA) said she would make the 46 pounds of Sprint phone records available to any member of the media, including bloggers.

"A couple dozen to 100 or so" of the 10,000 names listed in the records are high profile names, said Palfrey.

With the injunction lifted, it appears Palfrey can now "distribute the records en masse to as many responsible journalists, press, media, bloggers in this country," as she has promised.

ABC News obtained a partial list from Palfrey and her publicity shy lawyer Montgomery Sibley in May, but in the 11th hour decided not to release them, instead only airing a bland interview with Palfrey.

Palfrey told the Vallejo Times

"Within 24 hours the whole thing was whitewashed," They had names to name and
they didn't name them. Who knows who got to them -- I think the powers that be
at Disney (ABC's parent company) were exerting pressure on them to kill the
story and they killed it at the last minute."

"I kind of think it will be like deciphering the Da Vinci Code," said Palfrey, in an exclusive (and very lengthy) Times-Herald interview at a local coffee shop with Matthias Gafni published on July 1st before the records were released.

In the interview, Palfrey declined to discuss her former business or whether it involved prostitution.

"Does it really matter at this point? I think there are bigger fish to fry here," she said.

How did she know the records weighed in at the much quoted 46lbs? Shipping them through the Benicia UPS store to her attorney in Washington Palfrey said the UPS clerk told her how much they weighed:

"46 pounds."

You don't get detail like that in the MSM or even Time Magazine with all their "fact" checkers.

Interesting insight into activities of Montgomery Sibley here at Suzi Q

Wall Street Journal Law Blog have an up to date review of the court appointed attorney for Jeane Palfry, Preston Burton (posted as registration is required)

July 5, 2007, 1:39 pm
Orrick’s Preston Burton: From Monica to the D.C. Madam Posted by Peter Lattman
A decade ago, Orrick’s Preston Burton represented Monica Lewinsky in the investigation of President Clinton by Kenneth Starr and in the impeachment proceedings before the U.S. Senate. Today, he’s representing Deborah Jeane Palfrey, a woman accused of operating a call-girl ring inside the Beltway. Palfrey says she was running an adult fantasy business and her escorts were not engaged in prostitution.

How did he come to represent Palfrey, whom the media has labeled the D.C. Madam? “Several weeks ago, I was minding my own business on a Friday, and Judge Gladys Kessler called me up and asked me if I was willing to take a court appointment in that case,” Burton told Corporate Crime Reporter. “And after checking with the powers that be here at Orrick, who were all very supportive, I agreed to do it. And we are in the midst of that right now.” (Click here for a Law Blog post on her colorful civil attorney, Montgomery Blair Sibley.)

The CCR spoke with Burton about his more-mainstream clients — alleged white-collar criminals. He told them that when it comes to corporate criminal investigations, he bemoans the “free the corporation, blame the individual” dynamic he’s witnessed the past few years. But now, instead of companies throwing their employees under the bus to resolve a government probe, Burton sees a shift.

“Now you have some companies who are not immediately rolling over and waiving the attorney-client privilege,” he told the CCR. “You are seeing some subtle signs of companies standing behind their people more than they were four or five years ago, when there was a rush to locate the rogue employees, throw them under the bus, distance themselves, and try and dust yourself off and start all over again.”

...and Finally and Very Bestest of all ...

Jeane interviewed in a Podcast (53 mins 24 s) with Columbia Indymedia on June 24th which you can listen to here (Thanks Bob Fitrakis & Harvey Wasserman!) - if interested in this fascinating case you must listen to this.

Although Ms. Palfrey was charged under R.I.C.O. statutes, she was not charged with tax evasion - there were no "co-conspirators" charged along with her. In 13 years of business, she had no girls arrested and no tax audits. She reported her income, filed her taxes and all of her employees received a 1099 each year - who also paid taxes - for 13 years straight, never once questioned.

It takes two or more to make a conspiracy ... prostitution is not illegal , it is not a Federal crime. Yet nowhere have Federal Attorneys ever prosecuted for prostitution - so Jane asks, why me ?..and why only me ?

One thing is for certain sure .. Brian Ross and his producer Rhonda Schwartz of ABC/Disney have a lot of questions to answer for the results of their "exclusive" seven weeks of investigations.

UPDATE

Washington Post have the story

Alleged Madam Can Distribute Records

By LUBNA TAKRURI The Associated Press Friday, July 6, 2007; 12:42 AM

WASHINGTON -- A woman accused of running a prostitution ring in the nation's capital is free to distribute thousands of pages of phone records after a federal judge lifted a restraining order on Thursday. ..... it tells you nothing you don't know if you have got this far.

Do not miss the Podcast - Listen NOW

Russian newspaper Gazeta
....has a fascinating view on the story - calling Madame Jean's girls "priestesses of love" ...

Whoremongers, Harlan Ullman, Shack Up & Awe , sundry thoughts about Google / Yahoo caches

Deborah Jeane Palfrey was a high class pimp and whoremonger. The FBI have been probing the escort service she operated very discreetly in Washington DC since 1993. Internal Revenue Service agents raided Palfrey's California home, and recovered newsletters that Palfrey distributed to her stable of college educated whores at Pamela Martin & Associates.

Now she is being pursued through the courts for running a top-shelf call-girl ring from her Vallejo, California home including a multiple-count racketeering and money-laundering indictment.. She has denied the escort service, which employed over 130 women, engaged in prostitution. She has let slip a name of a "john" , this was Harlan K. Ullman (see pic c/o CIS) who hangs out as a senior adviser at the Center for Strategic and International Studies (CSIS) and was apparently the author of "shock and awe" (aka Bomb the fuckers back to the Stone Age) - the first of dozens she claims she is ready to expose. (Well he used to be a senior adviser at the Center for Strategic and International Studies (CSIS) but you will find he is no longer listed and the most assiduous search of their website scores big fat ZERO - but worry not his biog there retreived on 16th April 2007 at 15:13:11 GMT is available @ http://66.102.9.104/search?q=cache:v0OKlzPT3fkJ:www.csis.org/component/
option,com_csis_experts/task,view/id,48/+Harlan+Ullman&
hl=en&ct=clnk&cd=7&gl=uk&client=firefox-a
- failing that try http://tinyurl.com/2nnfmn or this link may get you there

The biog is cached at Yahoo and probably elsewhere, even Lord Patel's technical staff may just have saved it.

Ullman tells CNN "The allegations do not dignify a response. I'm a private, not a public, citizen. Any further questions are referred to my attorneys." *** CIS Biog.

Regrettably we got no such revelations yesterday when Deena Edridge of Wentworth Place, Naas (near Dublin) pleaded guilty to running a brothel from a rented flat on swanky Bachelor's Walk Dublin.

Customers who made contact via a sophisticated and undetectable mobile phone exchange run by two full time operators were charged Euros130 per half hour and Euros 220 per hour for sexual intercourse and other activities. (Which in the much depreciated US$ = about $400 an hour) There was also a "Domino's Pizza service" where customers could order girls to a hotel room or to their own home.

The Dublin Circuit Criminal Court was told that the Police estimated the annual takings at Euros 4 Mn.

How did PC PLod determine that this 24/7 brothel which worked the girls in a day shift from 12am to 7pm, and an evening shift from 7pm to 5am with five to seven girls working at any time from a total of 16 girls, find out about this busy little business ..... ?

Det Sgt Holohan said they mounted a surveillance operation on the premises at Bachelor's Walk for a number of months.

*** CIS Biog at Center for Strategic and International Studies (CSIS) from Google cache (wonder how long that will last ?)

Harlan Ullman is a senior associate with CSIS. His expertise spans national security, foreign policy, terror, defense, economics, and finance as well as Asia, the Middle East, and Europe. A columnist for the Washington Times, he is a frequent commentator in U.S. and international media including Fox, BBC, and Al Jazeera TV. His latest book, America’s Promise Restored: Preventing Culture, Crusade, and Partisanship from Wrecking Our Nation (Carroll & Graf, 2006), is a provocative analysis of why our government is broken and what needs to be done to make it work again. An honors graduate of the U.S. Naval Academy, Ullman completed more than 150 combat missions and patrols in Vietnam in Swift Boats and later commanded a destroyer in the Persian Gulf. With a Ph.D. in international affairs, finance, and economics, he has been an academic and businessman as well as an adviser to the most senior levels of government and the private sector. He is also principal author of the doctrine of “shock and awe,” which was substantially different from what was advertised in Operation Iraqi Freedom. After leaving naval service, Ullman joined CSIS as senior fellow and director of the Political-Military and Strategy Programs and began consulting with a number of Fortune 100 companies. Elected to the board of the Wall Street Fund, he later formed his own company, the Killowen Group, a consulting firm with broad financial interests. He has served on the boards of several related investment and venture capital companies with holdings in Asia and as senior partner and vice chairman of two companies in the high-technology area. Ullman is currently chairman of the advisory board of two companies engaged in Smart Zone Management and homeland security; serves at the Center for Naval Analyses, where he chairs the Senior Seminar and is a senior fellow; serves at the National Defense University as a distinguished visiting fellow; and is on the Senior Advisory Board of the U.S. European Command and the NATO Defence College.


PS Don't try and "e-mail this expert" because through CIS you get "unidentified ID" - there is a number 703-824-2194 but Harlan's personal voice recorder answers and re-directs you to 202- 258 - 8003 and he will personally tell you - well at least he told us, that the story was "beneath contempt" and directed enquiries to his attorney Marc Macusey at Bracewell Guiliani , New York.

Current Bibliography for Harlan Ullman on the page gives recent articles

CSIS Senior Advisers Arnaud de Borchgrave and Harlan Ullman published a commentary in the Washington Times, "Rebuilding needs, here and there." 04/03/2006

CSIS senior advisers Arnaud de Borchgrave and Harlan Ullman published a commentary for UPI, "Iraq vs. U.S. decay." 03/30/2006#Rebuilding needs, here and there." 04/03/2006

I guess all his details just accidentally got wiped - you know how easily that happens with computers - thank goodness for Google and Yahoo caches they must be saying at CIS . Of course they could stop caches being made by a simple Meta com

Sex , Harlan Ullman, Jeff "Whitehouse Pet of the Month" Gannon and Tony Blair's sleepovers

Yeas&Nays: Friday, Apr. 20 Here is a curious collection of news from Examiner.com which brings together Harlan Ullman and Jeff "Whitehouse Pet of the Month" Gannon

It was Sex Scandal Day at Nathans of Georgetown on Thursday, as Jeff Gannon (AKA James Guckert EX marine and male prostitute)(see pic) and Harlan Ullman joined owner Carol Joynt for the lunchtime Q&A Cafe discussion series.

Ullman, a senior adviser at the Center for Strategic and International Studies(although every trace of him has been removed from their website- see yesterdays post) and the Atlantic Council who famously coined the phrase “shock and awe,” was recently named by “D.C. Madam” Deborah Jeane Palfrey as “one of the regular customers” of her prostitution ring. But Ullman says it’s rubbish.

“The allegations are outrageous and do not dignify a response,” Ullman told the Nathans crowd. “My wife and I view this as most bizarre. ... It’s like being in a bad Franz Kafka novel.” When asked by Joynt whether he’d ever met Palfrey, Ullman said “absolutely not,” adding “I have no idea why lightning happened to strike me.”

As Mrs Palfrey ran her high class, high rise, high maintenance hookers from Vallejo CA. it seems highly unlikelythat any jaded pol seeking a quick hand job or "full relief" from the "Shock and Awe" of the Harlan Birley of Washington Political life would have ever met her - or even known of her.

The proceedings must have been a hoot, Jeff said to the startled crowd “My personal life ? ..... I put all that behind when I decided to become a journalist.” Not the only thing you put behind you by all accounts jeff.(James)

Strange how , as Wayne Madsen pointed out Jeff's (James's) visits to the Whitehouse coincided with those of Tony Blair's sleepover 16/4/04 This was not the time (18th July 2003) Tony Blair spoke to Congress, got a standing ovation but on-one is sure if he actually received his Congressional medal.... but he was around both days at the White House .. 6/17 12:29 - 1:41 (12:32-1:11) -6/18 12:16 - 1:42 (12:50-1:34).

This is the Wayne Madsen quote ;

"It is interesting to note that male prostitute and faux journalist Jeff Gannon was present at the White House on two occasions when Bush and Blair were meeting: 4/16/04 Gannon entered at 10:51 am -departed 3:08 (2:41-3:09) (Bush/Blair press conference) and the really interesting Gannon visit: 11/12/04 Gannon entered 10:57 am and did not exit the White House on the day that Bush was again meeting with Blair."

UPDATE - The Atlantic Council - search their website and you get

"Sorry, no pages were found containing harley ullman."

Recent Google cache (cache of http://www.acus.org/ as retrieved on 19 Apr 2007 12:22:19 GMT.) does show this reference however....

March 21, 2007
The Washington Times
Article: Avoid confrontation, by Harlan Ullman and Sergey Rogov. Harlan Ullman is a senior adviser at the Center for Strategic and International Studies and the Atlantic Council.

Curious how both the Center for Strategic and International Studies and the Atlantic Council have made poor old Harlan Ullman an unperson... Let's see how the rabidly middle of the road, unbiased, neutral Washington Times deals with his perceptive apercus on world affairs. ?

Angela Eagle ...and a State of Emergency over oil and gas

Angela Eagle, slim and elegant, as beautifully dressed as she is spoken, with an acute and finely trained brain was discussing current Treasury policy and the alleged bad blood now resulting from No 10 trying to micro-manage the Treasury in the way the Treasury wanted to micromanage everything else before cuddly loveable Gordy became temporary tenant at No 10 on the BBC4 World at One programme earlier.

"Nobody predicted the current oil price spike"

Oh really ?

We we might direct he alert mind to the statements from Goldman Sachs, into whose pockets the Government shovelled many sacks of gold to prolong and delay at great cost to the tax paper and profit to Goldman Sachs the affairs of Northern Wreck.

There must therefore be the occasional contact, odd chat, over a nice dry, crisp Sancerre in a trendy London eaterie at tax payers expense of the state of the economy oil prices etc., Especially considering that each price rise does actually swell the coffers of HM Treasury more than might have been anticipated when planning national income (which one assumes someone does).

Marketwatch March 7, 2008 ..." With $100-a-barrel here for now, Goldman Sachs says $200 a barrel could be a reality in the not-too-distant future in the case of a "major disruption"

"Goldman analysts Arjun Murti, Kevin Koh and Michele della Vigna said prices have advanced more quickly than Goldman had forecast back in 2005, when it predicted a range of $50 to $105 a barrel as part of its "super-spike" oil theory. "

Are oil prices headed for a 'super spike'? from that little known and rarely watched TV channel CNN. Online article May 2nd 2005 and at the time many, many others

This report featured the Goldman analyst Arjan Murti who had produced a ," thoughtful, 30-page piece of logical analysis ....Murti had previously raised the notion of a super spike in two reports last year--in June and September--forecasting a then sensational peak price of $80 a barrel. "

Reporter Andy Serwer explained "The crux of Murti's theory is simple: We're in the middle of a classic boom-and-bust cycle. The economy has been heating up here and in China, which pushes up the cost of crude. When the price of oil--and especially, here in the U.S., of gasoline--climbs too high, it curbs economic activity, which then depresses the demand for oil, causing prices to drop. Nothing revolutionary there. For now, though, demand for crude is continuing to rise--if a little more slowly than last year. That means prices could go higher. Remember: In terms of 2005 dollars, oil peaked in 1980 at $85 a barrel. "

"All I did (Murti explained ) was to raise the high end of my price band from $80 a barrel to $105 a barrel," says Murti. "Spending on gasoline in the U.S. relative to the overall economy is still well below where it was in 1980--81. So demand could still climb from here."

A week later, at the firm's annual shareholders' meeting, Goldman Sachs CEO Hank Paulson ( now US Treasury secretary ) felt compelled to defend the report and the integrity of the analyst and his firm.

We would direct the elegant Angela's gaze to the essential reading for literally everyone intersted in UK finacial / energy forcasting by Euean Mearns on The Oil Drum

A State of Emergency

This crisis (in energy supplies and costs) has been turned into a state of emergency by the indifference of political leaders in the UK (and throughout the world), fluttering in the wind of poorly informed public opinion while they have prevaricated about expanding renewable energy resources and building new nuclear power stations. All warnings of this pending energy crisis have been ignored in favor of pursuing popular policies that created the illusion of prosperity whilst the fundamentals of our nations security and well being have been draining away.

Here are a few pointers to what I think we can expect in the next 18 months:

1. Forever rising energy import bills will pressure Sterling which will continue to fall, pushing up the cost of energy, food and consumer goods even more.

2. Public sector workers, no longer able to borrow to supplement income will begin to strike once they discover that 3% wage increases do not come close to covering the rise in the cost of living (the great inflation lie will be found out).

3. Unemployment will begin a steady rise as financial services, banks, building sector, airlines, airports, leisure and retail come under severe pressure. They will be joined by public service workers as the government struggles to fund public services with falling tax receipts, spiraling debt and a falling pound. (already happening in Aberdeen with deep cuts in education spending across the city and teacher numbers being slashed). (QV Californian City of Vallejo filing for Bankruptcy)

4. The elderly and poor will really struggle this winter to pay their energy and food bills. If the weather is cold, the grid might fail and the vulnerable will begin to die from cold and starvation.

To illustrate this Euan Mearns has produced an amended chart from a presenation of 58 slides given internally by someone in BERR - Department for Business, Enterprise & Regulatory Reform (what in the old days we used to call the Board of Trade) this shows Net UK oil and gas national supplies and demand and in GREEN the growing horrible national deficit
This demonstrates how from an energy rich and independant country we have now tipped into an energy importer and the deficit is now growing at an alarming rate. For example one single component , national gas consumption and it's sourc in this graph produced by BERR shows the way how imports (especially from Norway) have grown and are growing monthly.

Click to enlarge .. which as Gemma Garrett was saying, if only it was always that easy.

PS Hot tip of the week . Radicalise yourself become a screaming hab dab mullah , get extradited and seek asylum in Norway where their leaders have had the good fortune and even greater sense to accrete the benefits of their North Sea "windfall" into a national fund for investment.

PS Second Hot tip of the week : Someone at HM Treasury get Euan Mearns in for a chat and pay him before you run out of money.