Tuesday, March 02, 2010

Tuesday reading...

Well, the Postal Service seems to be getting serious about addressing it's budget woes. Unfortunately, the Postal Services woes seem to be quaint in comparison to the billions lost by Wall Street, Detroit, AIG, etc....

Service cuts should be a start - I'd drop Wednesday delivery as well - but I'd add delivery kiosks on certain blocks that would eliminate the need for door-to-door delivery. I think the US Postal Service should embrace electronic bill paying and create a central clearing center for all bills by working with the big banks. Many people are still not on the e-pay bandwagon because of concerns about privacy, but the Post Office could play a huge role in validating a bill paying service.

Faithful readers will remember this quote from October of last year....

"I am not necessarily anti-Postal Service, but I watch the lonely mail carrier drive past my house every day delivering my 20% off coupon from Bed, Bath and Beyond or another offer from Verizon and I cringe at the inefficiency. The Postal Service served a vital role in the development of the US over the past century but we need to look at ways to change and evolve its services to maintain its value in the coming century."

Over the past couple of years CDS became the phrase of the day as AIG blew up because of their CDS obligations. Basically, a CDS spread is a measure of state or company's risk of failure to meet their debt obligations.

Consider the CDS spreads for some key states....

1. Maryland -- 66 basis points
2. Texas ------ 75 bps
3. Connecticut - 119 bps
4. Mass. ------- 121 bps
5. Ohio ------- 137 bps
6. Nevada ----- 191 bps
7. Michigan ---- 211 bps
8. New Jersey - 222 bps
9. New York --- 224 bps
10. Illinois ----- 234 bps

Bonus: California - 301 bps!

It's interesting to note that these states represent roughly 46% of the US population.

There have been a number of questions about the impact of the census on unemployment data this year. The Census Bureau will hire up to 1.4 million people but that includes some people that were hired last year. The expectations are for about 200k jobs added through April and then about another 500k jobs added in May. This could cut the unemployment rate slightly - maybe 0.1% to 0.2%.

Also, if you want to do your patriotic duty to help curtail the deficit make sure you mail in your census form!

“It costs us just 42 cents in a postage paid envelope when households mail back their 2010 Census forms,” Groves said. “The Census Bureau will spend about $25 per person if we have to go out and knock on the doors of households that don’t mail them back.”

Finally, the music in this video from OK GO is below average -- reminder to turn down your speakers before clicking the video -- but the work that went into setting this thing up is crazy!


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