Explaining Southern California's economy

Tech Geek Monday: All hail PandoraJam!

Pandora Jam

Bitcartel

It's the little Pandora app that makes a very big difference in how you use the music streaming service.

I've been a big Pandora fan for about a year now. Lately, my love has been getting steamrolled by various Spotify evangelists, but for me, I don't feel like I've really gotten everything I can out of the Pandora experience. As you probably know, Pandora is internet "radio" — its killer technology is a predictive algorithm that can take a song, artist, even an album title and turn it into a stream of music, by using the song's DNA. This is the "Music Genone Project"). You provide an input based on what you like — say, Ozzy Osbourne or Gustav Mahler — and...Pandora's box of music is opened! 

Pandora has effectively replaced iTunes as my go-to music resource. iTunes is fine, but I've always liked radio better than the self-programming that more self-contained music formats entail — everything from mix-tapes in the 1980s and '90s to iTunes playlists now. Like the radio, Pandora does the work for me. (See, this is how I wound up working at a radio station!)

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Gov. Brown's pension-reform plan: Painful but necessary

Jerry Brown

Max Whittaker/Getty Images

California Governor Jerry Brown announces his public employee pension reform plan October 27, 2011 at the State Capitol in Sacramento, California.

Jerry Brown rolled out his pension reform plan yesterday. The Patt Morrison Show did an entire segment on it. The upshot? it's a humdinger. The New York Times sums it up:

Mr. Brown called for raising the retirement age of new employees who do not work in public safety to 67 from 55. He said employees should pay up to 50 percent of their annual pension costs. To reduce the financial exposure of the state, he said future pensions should be a hybrid of the traditional pension model and a 401(k).

To deal with what have been widely seen as abuses of the retirement system, Mr. Brown said the pensions of all new employees should be based solely on their regular salaries, not taking into account any overtime or bonuses. For existing employees, he said the retirement benefits should be based on an average of the last three years’ salary.

He also said that state employees should be barred from double-dipping: retiring, taking pensions and then taking on another state job.

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Let the battle begin: Stagflation or 'Stuckflation'?

This CNBC video features the musings of Barry James, who manages the James Golden Rainbow Fund, which "seeks to provide total return through a combination of growth and income and preservation of capital in declining markets." More to the point, Barry was asked to consider whether we're currently experiencing a replay of the 1970s, a decade that will be forever known for "Saturday Night Fever," the Bicentennial, punk rock...and stagflation, a scary economic phenomenon that combines low growth and high inflation.

We certainly have the low growth part right now, even though the third quarter 2011 data showed that U.S. GDP was 2.5 percent, much better than expected. The high inflation side, on the other hand, hasn't really materialized. Our current rate is 3.9 percent, just slightly above the historic average of 3.38 percent. And this is with the Federal Reserve pouring money into the economy.

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The grim jobs outlook for Southern California in 2012

Mercer 12966

Mark Ralston/AFP/Getty Images

Unemployed father of two, Michael Lopez waits for work outside a temporary labor office in the Southern Californian town of El Centro, a town of 50,000 people where 30.4 percent of the work-age population are without employment, on October 28, 2010.

Yesterday, I blogged about the 2012 CSU Fullerton Economic Forecast and its fairly dire outlook for the national economy. Fullerton's economists also looked at the outlook for Orange County and the Southern California region. I'm going to focus on jobs, the biggest issue facing SoCal, where unemployment, at 12.1 percent, is well above the national average of 9.1 percent.

This is from the forecast:

Given the myriad of problems in the horizon both within the U.S. and globally, and prospect of little political will for forceful actions, the scenario of “muddling through” is expected not only at the national level but also at the local and regional levels. Our forecasts of payroll growth for Orange County are for a gain of only 7,300 jobs in 2011 and 16,300 jobs in 2012, or .5% and 1.2%, well below the historical average for the twenty years preceding the recession. Southern California region is expected to add only 20,000 jobs in 2011 and 95,000 jobs in 2012. As mentioned above, once the economy begins to establish an upward trend and gains momentum, jobs will be created mostly in areas of the region’s strength — construction, high-tech, business services, and leisure and hospitality. Over time we expect productivity to improve with a greater focus on exports.

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The Euro rescue plan: A rundown of opinions

People walk by a National Bank of Greece

LOUISA GOULIAMAKI/AFP/Getty Images

People walk by a National Bank of Greece in Athens on October 27, 2011. Greece reacted with measured relief on Thursday after European leaders sealed a deal to contain the eurozone debt crisis that slashes the country's huge debt by nearly a third. LOUISA GOULIAMAKI/AFP/Getty Images

Has Europe finally solved its debt-crisis problem? Well, that depends on who you talk to. Yesterday, hot on the heels of the announcement that European financial leaders had labored into the wee hours to finally get their act together to rescue Greece and save the Euro, I heard an economist say she was pleased that Europe had finally agreed on a plan...to agree on a plan!

Yeah, not exactly a ringing endorsement of Europe's ability to right its listing ship of states.

Meanwhile, around the blogspshere, various voices weighed in. At Reuters, Felix Salmon took a deep dive into the matter of credit default swaps (CDS) on Greek debt (although it wasn't nearly as deep as some). You're not going to want to wade into this debate unless you're prepared to induce a pounding financial headache, but the topline summary is fairly simple.

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