Author: Gregory White

The Obama administration released its budget for 2011 and it has tons of new spending for infrastructure included.

Some states are getting a ton of jobs-producing cash. Alaska is getting over $1100 per person. Washington DC will get over $750 and Wyoming gets over $565.

But some states aren’t getting very much of the haul, even though they might need it.

We’ve calculated who is getting the least out of the President’s budget by looking at spending per person in each state.

Check out infrastructure’s biggest losers >

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See Also:

• How The %&$! Do You Spend $3.8 Trillion?
• Obama’s Budget Has One Small Missing Item: $6.3 Trillion In Guarantees For Fannie And Freddie
• California’s Share Of The Infrastructure Budget Is So Big They Couldn’t Add It Up

Obama has emphasized in his speeches that it is the “richest Americans” who will get hit with tax increases, but by letting many tax-relief initiatives expire, Obama is targeting middle class Americans with shadow tax increases too.

Reuters:

If the provisions are allowed to expire on December 31, the top-tier personal income tax rate will rise to 39.6 percent from 35 percent. But lower-income families will pay more as well: the 25 percent tax bracket will revert back to 28 percent; the 28 percent bracket will increase to 31 percent; and the 33 percent bracket will increase to 36 percent. The special 10 percent bracket is eliminated.

Now don’t miss: How the %&@! Do You Spend $3.8 Trillion >

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• How The %&$! Do You Spend $3.8 Trillion?
• Obama Blazes The Path To Economic Suicide
• And Now Comes The Part Where We Tax The Living Sh#$ Out Of The Banks

The President’s budget has spelled out $3.8 trillion in spending for fiscal year 2011.

Getting to that sort of number takes bureaucracy on a grand scale, and with all the government departments there is plenty of opportunity for such spending.

Take a look at our break down of spending by department and some of the biggest projects each has in our line by line rundown.

See where your taxpayer dollars go >

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See Also:

• Here’s Why Attempts To Cut The Deficit Will Definitely Make The Nation Poorer
• California’s Share Of The Infrastructure Budget Is So Big They Couldn’t Add It Up
• Look At This Future-Generation Crushing Budget Obama Just Unveiled

Larry Summers took claim for the return to profitability and escape from recession for the Obama administration today as GDP numbers shocked the markets.

It was the dramatic moves by the administration, “that pulled the [US] economy back from the brink of a depression, and created a basis for economic growth,” said Summers in an interview with Charlie Rose at Davos.

Summers did couch the elation at the growth numbers the same way many did today though, explaining that it was inventory restocking, not consumer spending, which made the fourth quarter so impressive.

“Certainly doesn’t suggest we are in any position to pop champagne corks,” he said.

In more forward thinking comments, Summers said that the focus must now shift to jobs and the new Obama payroll tax credit was a means to create the desired hiring growth the U.S. needs.

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• GDP Growth Demolishes Expectations, Accelerates To Fastest Rate Since 2003
• Wall Street Trader: “Pretty Much Everyone Hates Obama.”
• Did Obama Finally Realize How Angry And How Screwed We All Are?

Spain has gone on the offensive targeting massive budget cuts as a means of bringing itself back in line with euro zone debt requirements. This includes cuts to social security, foreign aid, and a hiring freeze on the civil service.

It is the latest attempt by the troubled state to dodge a crisis like Greece is in.

The Spanish government has decided the best way to fight the crisis is with a combination of massive spending cuts and tax increases in what some are calling an “austerity budget.”

They are even going so far as to raise the retirement age from 65 to 67. The government is doing everything it can to meet its budget requirement for 2013, which includes knocking back its deficit from 11.4% of GDP in 2009 to 3% of GDP by 2013.

“It is a rigorous plan which we are convinced will allow us to meet our commitments by 2013,” said Spain’s Deputy Prime Minister María Teresa Fernández de la Vega.

Raising taxes, however, might even further dampen the chances for the Spanish economy to emerge from recession this year. Unemployment has been stuck in the high teens, with under 25 year old unemployment at a staggering 44.5%.

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• The PIIGS Get Slaughtered, As Greek Bond Situation Deteriorates
• Roubini At Davos: Greece Is Obviously Bankrupt
• Watch How Banks Get Whacked When Greece Goes Bust

In a sale of public assets larger than anything seen since Margaret Thatcher’s heyday, Britain hopes to raise much needed cash privatizing banks.

The debt laden country is attempting to sell part of the 71.5 billion pound ($116 billion) investment it made in troubled banks during the height of the financial crisis.

Pressure for the sale is mounting as Standard and Poors has called the country’s economic stability into question, citing massive debt levels and a beleaguered banking system in need of reform.

They better move fast. Standard and Poors is pointing towards a downgrade for the UK that would make raising money for spending more difficult and potentially put Britain on track to join Europe’s PIIGS, states which have been brought to the brink by their sovereign massive debt.

Unfortunately, the opposing parties in Parliament are currently spending more time debating banking penalties than solving the potential debt crisis.

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See Also:

• One By One, The Men Who Bankrupted Britain Have Returned To Lucrative Jobs. Don’t They Have A Shred Of Shame?
• Bill Gross: The U.K. Rests On A Pile of ‘Nitroglycerine’
• The U.K. Is About To Crash Along With The Sovereign-Default PIIGS

John Paulson’s big bet on Russian Aluminum firm Rusal may not go as well as some of his other bets.

In its Hong Kong deput, the IPO tanked 10%.

Paulson, President at the New York hedge fund Paulson and Co. Inc., put himself forward as a cornerstone investor in the IPO launched in Hong Kong today, but the results have been disappointing so far.

This is classic Russia. It holds so much lure to global investors, and then over and over again it turns out to be a frustration

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• Did A New Pipeline Just Make Russia The Most Important Energy Superpower By Far?
• John Paulson Makes Huge Bet On IPO Of Russian Aluminum Firm Rusal
• John Paulson Takes Stake In Advertising Firm SuperMedia

Ireland is in the midst of a real estate vacancy crisis just as bad as California and Florida in the United States.

Its go-go real estate boom days are over, and with it comes vacancy rates in new developments of over 50%. Over 600 completely empty residential building developments exist across the country, including places like Dublin and Cork.

A map, made by the country’s National Institute of Regional and Spacial Analysis shows that in some areas, housing vacancies are beyond 50%.

These empty feelings come a long with a full stomach of debt. Ireland’s banking crisis may cost the government 50 billion euros ($70 billion) in the end. It will be difficult to make mortgage loans in an environment so over leveraged already, so many of these developments might just become ghost towns for years to come.

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• Investors Pour Money Into The Debt-Laden Irish Nightmare
• Reminder: The Worst Sovereign Isn’t Greece, Iceland Or Ireland
• Inside Ireland’s Desperate Attempt To Conceal The Health Of Its Finance Minister

Nouriel Roubini has come out in support of a second term for Ben Bernanke as he faces increasing pressure in his quest for renomination.

The Fed Chair has seen opposition rise on both sides of the aisle, as discontent over his role in the financial crisis grows.

Roubini, however, has singled out the Fed Chair for his ability to deal with the crisis and stop another Great Depression from occuring.

Paul Volcker has also recieved Dr. Doom’s support, as Roubini has called his push to change bank regulations real progress towards his own goal of breaking up banks.

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• Sorry Ben Bernanke: Your Inflation Fighting Scheme Won’t Work
• Volcker: Grab Wall Street By The Balls, But Deregulate Normal Banks
• Why Paul Volcker Is Still Giving The Fed Way Too Much Credit

While everyone is talking about the downfall of California amidst its worst fiscal nightmare ever, New Jersey has been largely overlooked.

But the Garden State is in the midst of its own financial crisis brought on by decades of overspending and a bloated public workforce.

The state is $8 billion in the red this year, notes Reason, and new Republican Governor Chris Christie needs to bring that down because it’s tearing the state apart.

Over a half a million residents have fled the state in the past decade as property taxes have risen to be the nation’s highest.

Now the new Republican government is beginning a fight back, but in some non-traditional ways.

It’s targeting state employees playing hookie, in an attempt to stop people from taking sick days for other reasons.

The state has far more to do, with lower corporate taxes and reduced spending an early set of goals to get the budget deficit in check so it doesn’t continue to trend towards the cliff, like California.

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See Also:

• California’s Crisis Is Still In Its Infancy
• S&P Downgrades California To Third World Country Status
• Why Excessive Fear And The Likelihood Of A Bailout Make California Debt An Attractive Investment

European Union leaders are now open to the idea of providing a loan of last resort to Greece as a means of stabilizing its deteriorating economy.

This decision is driven by fear that the IMF might need to bail out Greece if the EU doesn’t, reducing confidence in the economic area and perhaps triggering a potential downgrade of other troubled states’ sovereign debt.

There are also creeping fears that a Greece debt restructuring could lead to its banks collapsing across the Central Eastern European region. This would affect troubled economies like Romania, which has already had to tap IMF loans to stay above water during the crisis.

It would work like this. Greek banks, such as Piraeus Bank, Alpha Bank, and Bank of Cyprus that have significant presences in Romania, Bulgaria, and Croatia would be forced to retreat from their forward positions to deal with the difficulties of their own country’s financial crisis.

Pulling out of those countries would put further pressure on their already flailing governments and expand pressure on consumers and businesses desperate for new lines of credit. This could lead to other CEE states calling for further assistance from the IMF or EU, ratcheting up the pressure and potentially causing further contagion.

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• Greek Minister Furious As European Central Bank Says It Would Let The Country Collapse
• Look How Quickly Schizophrenic Markets Lost Faith In The Euro System
• Euro Brinkmanship Escalates As ECB Shuts Door On Greek Bail-Out

Dublin is to feel the benefit of 8.48 billion euros ($11.98 billion) of new construction as the dormant property sector rebounds in Ireland this year.

This is a bit of a surprise considering the dire straits of the Irish economy, which has swung from bank bust to sovereign debt warning since the financial crisis began. 

Dublin, once nicknamed Dubai on the River Liffey because of its abundance of riverfront cranes, looks set to turn the corner in terms of construction as investors anticipate a return to economic growth by the time of project completion.

The property restart comes in addition to 8.2 billion euros ($11.6 billion) worth of property already under construction. The 44.3 billion euros ($62.6 billion) of projects on hold may be more alarming for foreign investors, as Ireland continues to be mired in a bank scandal which has cost the government billions and broken down the confidence of the citizens in the state.

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• Famed Manchester United Mired in a Debt Crisis of ‘Galactico’ Proportions
• Sorry, Krugman, But I’d Rather Not Learn From Europe
• Uh-Oh: Now Jim Rogers Is Warning About The Chinese Property Bubble

Barclays is still in need of some serious cash.

Credit Suisse predicts the British Bank needs between 17 and 28 billion pounds ($27.6 and $45.5 billion) to meet the new 8% or 10% tier one requirement, reports The Telegraph.

This is a surprise for the bank and its investors as JP Morgan predicted a smaller 12.8 billion pound ($20.8 billion) increase in July.

The bank now has to look for ways to raise the required capital, which could include a cut in its stake in fund manager BlackRock or a sale of its investment banking division Barclays Capital.

Shares are off nearly 4% today.

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• Mortgage Securitization Is About To Make A Comeback
• Former Barclays Chief: Bonuses Were Paid Fraudulently
• Start Taxing Banks Now, Because We’re Going To Bail Them Out In The Future

Only hours after it emerged that Dubai did not receive half of its $10 billion bailout, new numbers suggest that the Emirate is actually in $170 billion of debt not $80 billion like it said.

A report issued by the Gulf investment bank EFG-Hermes states, “The total debt held by Dubai Inc could well be in the range of $130-170 billion,” Dubai Inc being the state and its owned entities.

This could spell further trouble for the Emirate in credit markets as its sovereign debt has been under pressure since the Dubai World funding crisis began on November 26th.

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• Check Out The Banks That Just Made A Boatload Of Money On The Dubai Bailout
• Abu Dhabi Bails Out Dubai!
• Euro Brinkmanship Escalates As ECB Shuts Door On Greek Bail-Out

Where junk bonds were once the game of hedge funds and private equity firms, they are now being re-branded as high-yield investments in Europe notes the Financial Times.

More and more regular investors and funds are dipping into the European high-yield bond pool, and issuances have increased 40 percent to respond to the demand.

This is liable not just to attract new entrants to the market in Europe, but also their high-yield experienced American counterparts.

“As European issuance, as a proportion of the global high yield market grows, you will get a virtuous circle effect as US fund managers start to allocate more of their global funds to Europe,” Mr Newman (portfolio manager at Rogge Global Partners) believes.

Try as you might to sound the alarm, this is inevitable for the same reason that high-yielding CDOs took off as a popular vehicle for pension funds. People just need yield. It’s not that they’re incredibly risk-averse or dumb, they need more money in an age of 1%.

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See Also:

• Famed Manchester United Mired in a Debt Crisis of ‘Galactico’ Proportions
• British Pound Teetering On The Verge Of Euro Collapse
• 1-in-3 Old Brits Live In Freezing ‘Fuel Poverty’ Hoping For Global Warming

How consumers are choosing to eat and drink is apparently a big predictor of broader markets, according to a graph based on ‘Pub Power’ over at EconomPic.

Yes, it sounds silly.  But the apparent correlation is impressive.

The graph overlays relative “pub power” people choosing to go out to eat at the pub, rather than eating at home, along with the Dow set one year back.

As a forward indicator it’s incredibly revealing showing that since 1993, when people stay at home the DOW has yielded a negative 9.8% return while when people eat out the return is a positive 10.8% on the year.

From EconomPic:

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• Merrill: Broke Americans Are Still Crazy For Kelloggs
• Jim Rogers: Brace Yourself For Food Shortages, Thanks To The Banks Hoarding Cash
• Venezuela Approaching Humanitarian Disaster As Chavez Expropriates Food Retailers

If you thought all you had to worry about was Chinese growth collapsing and a double dip recession, think again. The World Economic Forum has put together their best of collection of potential economy crushing crises and there are far more than you might imagine.

From oil price spikes to nuclear proliferation, here is what to look forward to in the new decade.

The 15 costliest risks in the next decade ->

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• Desperate Greek Minister Tries Instilling Confidence On CNBC, Doesn’t Get Interrupted By News Of A Governor And Prostitute
• Euro Brinkmanship Escalates As ECB Shuts Door On Greek Bail-Out
• 10 Looming Geopolitical Disasters

As fears rise this morning of a German led European double dip recession, Greece and Portugal are on the path to an economic “slow death,” according to Moody’s Investors Service. The troubled countries have already had pressure on them for economic reform, with Greece being under near constant scrutiny from the European Central Bank.

Difficult lending terms for the troubled economies and increasingly negative outlooks on each country’s sovereign debt are forcing dramatic fiscal changes for each government.

Moody’s was more confident that Portugal could find its way out of its economic mess saying that its window of opportunity for reform was much wider than that of its Mediterranean counterpart.

Bloomberg: While the two countries can still avoid such a scenario, their window of opportunity ’’will not be open indefinitely,’’ Moody’s said in a report today from London. Portugal, with a negative outlook on its Aa2 rating, has more time “to reverse this trend” while Greece “has significantly less time.”

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• Scared Of An Auction, Greece Wants To Negotiate Interest Rates Behind Closed Doors
• Desperate Greek Minister Tries Instilling Confidence On CNBC, Doesn’t Get Interrupted By News Of A Governor And Prostitute
• Gartman: Greece’s Prime Minister Doesn’t Realize How Much Trouble He’s In

Goldman Sachs is getting into the ETF game, but they lag behind even the pretenders and may not even make an impact on the highly competive market.

While Goldman already traded ETFs, this is their first foray into ETF creation.

American Banking News argues thas this is an unimpressive entry as Goldman is not dramatically changing the industry and looks to make little money off a product that requires limited management and makes small fees.

Many other firms, including the bond house PIMCO, have recently entered into the industry creating managed ETFs. Goldman’s ETFs would be index tracking, not the managed ETFs which have become all the rage in the industry.

Goldman intends to focus on Brazilian, Indian, Chinese, and Korean stocks at the outset, according to Dow Jones Newswires.

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• Goldman’s Jim O’Neill: Easy Money And High Oil Prices Make Russia The #1 BRIC For 2010
• Goldman Loves These 50 Stocks With Heavy BRIC Exposure
• Marc Mobius: Here Comes Another 40% Surge For The BRICs

European Central Bank leaders are flying into Greece today as the debt crisis continues to escalate.

Jurgen Stark, an excutive board member of the ECB, started another scare this morning with his quote in the Italian newspaper Il Sole 24 Ore. “The markets are deluding themselves when they think at a certain point the other member states will put their hands on their wallets to save Greece,” he said.

This, coupled with already established fears on the issue of Greek fiscal security, led to a decline in the Euro in trading this morning.

Greece is now facing an evaluation by ECB leaders as to whether or not they can stay true to their deficit cutting measures aimed at keeping it within the Eurozone’s strict budgetary guidelines. Debt markets are also being rattled by this escalation increasing the yield on Greece’s ten year treasury bonds. Martin Tyler of the Financial Times added fuel to the fire in terms of Eurozone security today by emphasizing the hardships built into the Euro setup for smaller states and how their escape from these is vital for the Euro’s long-term success.

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See Also:

• Gartman: Greece’s Prime Minister Doesn’t Realize How Much Trouble He’s In
• Moody’s Downgrades Greece, As Civil Servants Union Threatens To Go On Strike To Protest Budget Cuts
• Desperate Greek Minister Tries Instilling Confidence On CNBC, Doesn’t Get Interrupted By News Of A Governor And Prostitute