Independent Fiduciary Consultant, Economics and Financial Ethics

One who intends to leave others better off for his having existed.

7/28/14

John Hussman on equity bubbles

“...this is an equity bubble, and a highly advanced one.

...it is easily beyond 1972 and 1987, beyond 1929 and 2007, and is now within about 15% of the 2000 extreme.

...the present one is diffused across all sectors in a way that makes valuations for most stocks actually worse than in 2000.

...the primary driver of the market here is not valuation, or even fundamentals, but perception.

The perception is that somehow the Federal Reserve has the power to keep the stock market in suspended and even diagonally advancing animation, and that zero interest rates offer “no choice” but to hold equities.

Be careful here.

...the Fed has now created $4 trillion of idle currency and bank reserves that must be held by someone, and because investors perceive risky assets as having no risk, they have been willing to hold them in search of any near-term return greater than zero.

...the Federal Reserve can certainly postpone the collapse of this bubble, but only by making the eventual outcome that much worse.”

http://www.hussmanfunds.com/wmc/wmc140728.htm

NC Ethics Commission Filing on Charter School Bill 793 and Phil Berger Conflict of Interest

STATE ETHICS COMMISSION
COMPLAINT FORM
ETHICS VIOLATIONS

The State Ethics Commission has the authority to investigate complaints against those persons covered by Chapter 138A, North Carolina General Statutes, “The State Government Ethics Act,” for alleged violations of the Act. Please see section 138A-12. G.S. 138A applies to legislators, legislative employees, certain public servants, and judicial officers.  

George Hartzman
Greensboro, NC  27455
NATURE OF THE COMPLAINT

§ 138A-37.  Legislator participation in legislative actions states; "no legislator shall participate in a legislative action if the legislator knows the legislator or a person with which the legislator is associated may incur a reasonably foreseeable financial benefit from the action"  

The person I believe may have violated specific provisions of the Ethics Act is President Pro Tempore of the Senate Phil Berger Sr., relative to SENATE BILL 793, as modified and passed by the Senate in and before July, 2014.

Legislation approved by the Senate, which Phil Berger Sr. voted for, appears to allow management companies running taxpayer funded charter schools to keep their employees’ salaries secret, which would lead most to believe Berger Sr. perverted the political process to benefit associates and family members.

Paul Norcross, Phil Berger Jr's Chief Political Adviser, whose father is Phil Berger Sr., personally profits from a charter school via a management contract.  Norcross, co-founder of the N.C. Alliance for Public Charter Schools which includes Phil Berger Jr. as a board member, appears to be in line to benefit from the legislation.

Mr. Norcross was appointed to the Public Charter School Advisory Council by Phil Berger Sr.

Phil Berger Jr., who has an approved charter school in Rockingham County, appears to be a potential beneficiary from the legislation.

Baker Mitchell, president of the N.C. Alliance for Public Charter schools also affiliated with Norcross and Phil Berger Jr., who is under investigation by the Department of Education, personally profits from his charter schools via management contracts, was appointed to the Public Charter School Advisory Council along with Norcross, by Phil Berger Sr. Mitchell appears to be a potential beneficiary from the legislation.

Alan Hawkes, Vice President of Greensboro Academy, who made the motion and voted to approve Phil Berger Jr's charter school, in what appears to be a violation of North Carolina Public Charter School Advisory Council Rules, was appointed to the Council by Phil Berger Sr., appears to be involved with a potential benefit from the legislation.


Phil Berger Sr. participated in a legislative action knowing persons that "may incur a reasonably foreseeable financial benefit from the action", including Alan Hawkes, Baker Mitchell, Paul Norcross and Phil Berger Jr.

The legislation may very well personally benefit Phil Berger Sr's son without taxpayer disclosure, 
based on the advocacy of Berger Sr., for the benefit of Berger Jr. and Hawkes, Norcross and Mitchell.

I believe the Public Charter School Advisory Council gave Phil Berger Jr. preferential treatment concerning his taxpayer funded application by board members appointed by Phil Berger Sr.

George Hartzman

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Previously;

Phil Berger Conflict of Interest Recusal Call; NC Bill SB 793 on Charter School Transparency 


Phil Berger Jr's Norcross' Phoenix Academy "management contract" request and conflict of interest


Paul Norcross' no-bid contract for himself paid for with taxpayer money?


Paul Norcross, apparently appointed to board by Phil Berger, denied charter school due to "conflict of interest"


N.C Alliance for Public Charter Schools Board of Directors; Phil Berger Jr. and Paul Norcross


The charter school issue not reported before the Walker Berger election


Phil Berger Jr. fellow board member under investigation by the U.S. Dept. of Education


From the meeting minutes when Phil Berger Jr. got his charter school approved


Is this what Phil Berger Jr's big financial backers want with Jr in DC?


7/26/14

Phil Berger Conflict of Interest Recusal Call; NC Bill SB 793 on Charter School Transparency

Phil Berger should have recused himself from voting.

"House lawmakers approved legislation Friday that allows private, for-profit management companies that run charter schools to keep their employees’ salaries secret, even though they are paid with public funds.

...Charter schools are run by nonprofit boards that get state approval to receive public money. Some of those boards contract with a management company...

...Rep. Tricia Cotham, D-Mecklenburg, said the exemption for employees hired by management companies opens the door to inappropriate hiring and overpayment of administrators...

Paul Norcross, Phil Berger Jr's Chief Political Adviser
 and co-founder of the N.C. Alliance for Public Charter Schools,
 who personally profits from his charter school,
gave himself a no-bid management contract,
was denied a charter school due to "conflict of interest",
and skipped the meeting when Berger Jr's school was approved by the Council.

...The change comes at a time when one prominent Wilmington-based charter school operator, Baker A. Mitchell Jr., has been fighting media requests for months that have asked him to fully disclose the salaries of all employees associated with his charter schools – teachers as well as those who work for his for-profit education management organization (EMO), Roger Bacon Academy.

Mitchell, who also sits on the N.C. Charter School Advisory Board that is tasked with approving and monitoring charter schools, operates four charter schools in southeastern North Carolina through his for-profit company.

Roger Bacon Academy has raked in millions of dollars in profits that consist of public funds since 1999 – and Mitchell himself has profited to the tune of at least $16 million in management fees over the past several years.


who is also president of the N.C. Alliance for Public Charter schools, 

was appointed to the Public Charter School Advisory Council

by Phil Berger Sr., who looks like voted to personally benefit 
his son, Baker Mitchell and Paul Norcross,
who was appointed to the Public Charter School Advisory Council
by Phil Berger Sr.

...this bill protects Mitchell and others like him who are free to hire family and friends through a private company that runs charters, and then pay them anything they like with public funds.

The legislation may very well personally benefit Phil Berger's son
without any disclosure to taxpayers
based on the advocacy of Sr., for the benefit of Jr.
and both Norcross and Mitchell.

...Governor Pat McCrory has previously said he’d veto any bill that prevented public disclosure of charter school salaries.

...The Senate must act on the bill before it goes to the Governor."

Alan Hawkes, a for profit charter school supporter,
in what appears to be a violation of North Carolina Public Charter School Advisory Council Rules
was appointed to the Council by Phil Berger Sr.


I believe the Public Charter School Advisory Council gave Phil Berger Jr. preferential treatment concerning his taxpayer funded application.


...no legislator shall participate in a legislative action 
if the legislator knows the legislator or a person with which the legislator is associated 
may incur a reasonably foreseeable financial benefit from the action, 
and if after considering whether the legislator's judgment 
would be substantially influenced by the financial benefit 
and considering the need for the legislator's particular contribution,
including special knowledge of the subject matter 
to the effective functioning of the legislature, 
the legislator concludes that an actual financial benefit does exist 
which would impair the legislator's independence of judgment.


§ 138A-37.  Legislator participation in legislative actions.

I believe the North Carolina School Board should have investigated what looks like Regulatory Capture by the taxpayer funded Phil Bergers before the extension for the school be approved without discussion..
.
.
A public servant shall ...remove himself or herself to the extent necessary, 
to protect the public interest 
from any proceeding in which the public servant's impartiality 
might reasonably be questioned 
due to the public servant's familial, personal, or financial relationship
with a participant in the proceeding. 

A participant includes (i) an owner, shareholder, partner, member or manager 
of a limited liability company, employee, agent, officer, or director 
of a business, organization, or group involved in the proceeding, 
or (ii) an organization or group that has petitioned for rule making 
or has some specific, unique, and substantial interest in the proceeding. 

...A personal relationship includes one in a leadership or policy-making position 
in a business, organization, or group."


§ 138A-36.  Public servant participation in official actions.

http://pulse.ncpolicywatch.org/2014/07/25/house-oks-bill-that-allows-private-charter-school-education-management-companies-to-keep-their-employees-salaries-secret/#sthash.EP3IhUg4.dpuf

http://www.charlotteobserver.com/2014/07/25/5066328/nc-house-approves-charter-bill.html#.U9PsxvldWnY#storylink=cpy


"liberating our lands, establishing our independence as a state with Jerusalem as its capital, and the right of return for refugees."

Iran's supreme leader calls for end to 'murderous' Israeli regime


"we will resist until our national goals are achieved. That includes liberating our lands, establishing our independence as a state with Jerusalem as its capital, and the right of return for refugees."

Senior Hamas leader Osama Hamdan

This appears to mean resistance until enough Israelis die or flee
so Hamas can take over the entirety of Israel.

What do you do
if you’re placed in the middle of a desert with someone just like you
with one bottle of water equally distant
and the all powerful entity that put you there  
says whomever drinks the bottle of water lives and who doesn't dies
and if the water is split or poured out you both die?


If Hamas had the firepower the Israeli's have,
how many causalities would there currently be?

If Israel were attacked with a nuclear weapon
would the bomb most likely be conveyed by missile
smuggled through a tunnel, or by land, shipping container
or a private yacht docked off the coast?


If goods do not cross borders
armies will

Frederic Bastiat

Are there times when compromise isn't appropriate?


If a cease fire involves allowing those who have vowed to eliminate Israel 
to re-arm, to kill more...?

If need is sustenance and a temperate climate
should you not do what you don’t want done to you
unless you need to?


Should a more permanent cease fire 
be contingent on establishing Israel's right to exist
if Hamas stated goal is to eliminate Israel?

Have most revolts been instigated by some with less who want more
against those with more?

What does a thief see when confronted with honesty?

Why did Japan bomb Pearl Harbor?


Have the powerless created symbols for the powerful to destroy
to create dissent by turning apathy into oppression?

Have the educated underemployed
caused most rebellions?

Were Hitler’s actions legal under German law?

How do many battle a few who can’t be assaulted with force?

If ignorance breeds fear and fear breeds bigotry
does bigotry breed hate?

Why did Hitler invade Russia?


If the Jews had equal weapons and training
would they have become Egyptian slaves?

Why did America occupy Iraq?


I don't have a clue of what weapons
will be used in World War III
but World War IV will be fought with sticks and stones

Albert Einstein

Have freedom and equality
been invoked by those interested in other ends?

Why did many white religious institutions
teach congregants that God supported racial segregation?

Is everybody related if traced back far enough?

I’ll tell you what war is all about


 You’ve got to kill people
 and when you’ve killed enough
 they stop fighting

General Curtis LeMay 

Can you hate someone you don’t know?


The mind of a bigot is like the pupil of the eye
the more light you pour upon it the more it will contract

Oliver Wendell Holmes Jr

Why were blacks not supposed to eat with whites
or use the same restrooms or water fountains?


He who will not reason is a bigot 
he who cannot is a fool
and he who dares not is a slave

Sir William Drummond

Should you do what you need to whether you like it or not
sooner than later?

If technological civilization has advanced more
in the last 10,000 years than the previous 1,000,000
the last 1,000 than the previous 10,000
the last 100 than the previous 1,000
including industrialization and exponential population expansion
and the last 10 compared to the last 100
now what?


Is it too late to fix?

7/25/14

"The gov may be paying incorrect subsidies to a significant share of the 5.4 million who signed up for health plans"

"The U.S. Government Accountability Office (GAO), recently conducted a study in which investigators attempted to use fake identities to sign up for subsidized healthcare under ObamaCare.

...All but one phony applicant was successful. Moreover, the GAO more broadly notes that “about 2.6 million ‘inconsistencies’ existed among applicants who had chosen a health plan.”

...government investigators have been able to procure health plans and federal subsidies for fake applicants with fictitious documents...

...undercover GAO investigators tried to obtain health plans for a dozen fictitious applicants online or by phone, using invalid or missing Social Security numbers or inaccurate citizenship information.

All but one of the fake applicants ended up getting subsidized coverage — and have kept it.

In one instance, an application was denied but then approved on a second try. In six other attempts to sign up fake applicants via in-person assisters, just one assister accurately told an investigator that the applicant’s income was too high for a subsidy.

...the investigators also cited: The government may be paying incorrect insurance subsidies to a significant share of the 5.4 million Americans who signed up for health plans for this year through the federal marketplace.

...as of mid-July, about 2.6 million “inconsistencies” existed among applicants who had chosen a health plan and that 650,000 of them had been resolved."

http://libertyblitzkrieg.com/2014/07/25/obamafraud-gao-study-finds-almost-all-fake-applicants-are-approved-for-subsidized-obamacare/

Friday Afternoon North Carolina Budget Fcuk up News

Although the economy grows in response to tax reductions
it is unlikely to grow so much that lost revenue is completely recovered
by the higher level of economic activity

Council of Economic Advisors

"...the 2013 cut to individual income tax rates is costing the state far more than originally projected.

[in 2013, North Carolina] ...cut income taxes from a three-tiered marginal system of 6 percent, 7 percent and 7.75 percent to a flat rate of 5.8 percent for 2014 tax year.

...the updated cost of the tax cut is $680 million for the current tax year.

That's $205 million, or 43 percent, higher than the original projection of  $475 million.

The cost for the 2015 tax year is also projected to be $200 million higher than original estimates – $890 million rather than $690 million.

Additional tax cuts are set to take effect Jan. 1.

...the revision is due to the fact that North Carolina wages have not grown as quickly as projected last year.

The Laffer Curve, anyone know what this says?

It says that at this point on the revenue curve
you will get exactly the same amount of revenue as at this point…

Does anyone know what Vice President Bush called this in 1980, anyone? 

Something-d-o-o economics, voodoo economics

Ferris Bueller’s Day Off

...the forecast does not account for corporate tax rate cuts.

...Republican leaders said last summer that lowering taxes would cause the economy to grow, helping more people find work and bringing in more revenue.

Why would some want others to believe
tax cuts pay for themselves?

They expressed confidence that the cost to the state would be actually be lower than initial projections.

Even by the standards of political boosterism
this is extraordinary

No serious economist believes…tax cuts will pay for themselves

The Economist

The unwelcome news comes as lawmakers continue to struggle to find agreement on teacher pay raises, funding for teaching assistants and cuts to Medicaid in the 2014-15 budget.

"...the tax scheme over the next five years will be ...nearly $900 million more than previously estimated," said Sen. Josh Stein, D-Wake...

http://www.wral.com/state-tax-cut-costs-ballooning/13841265/#O4D0ydvE23btm6JC.99

There is no credible evidence
tax revenues…rise in the face of lower tax rates…

Every $1 trillion tax cut should lead to $830 billion more debt

N Gregory Mankiw
Chairman of President Bush's Council of Economic Advisors, 2003-2005

Has corruption of the political, capitalist and information systems
negatively influenced economic performance and consumer behavior
through legislation, budget appropriation, regulation and taxation
to benefit a few at the expense of many?

A government which robs Peter to pay Paul
can always depend on the support of Paul

George Bernard Shaw

Why do most who argue the relatively wealthy pay more taxes
than most as a percentage of income exclude Social Security, Medicare
 and other federal, state and local income, sales, property, toll road, license, permit,
communications entertainment, fuel, transportation and utility ect…taxes?

"Panama issues price controls for basic goods"

"...Fresh on the heels of his victory in May, the then President-elect [Juan Carlos] announced that one of his first orders would be to regulate prices for staple food products.

He followed through on his promise, establishing price controls on certain brands of roughly two dozen items like chicken, rice, eggs, and bread.

And within a matter of weeks, many grocery store shelves are already empty, at least for the regulated items.

...the price of basic foods rose 4.1% from April 2013 to April 2014.

Over the last five years, food prices have risen more than 24%.

And when average wages are little more than a few hundred dollars a month, a 24% increase in food prices really hurts.

...Panama ...is dollarized.

...Panama has never issued its own currency.

Locals and foreigners alike pay US dollars for goods and services across Panama just as you would in Houston, Jacksonville, or Las Vegas.

This means that the country is subject to all the whims and consequences of US monetary policy; when the Fed conjures money out of thin air, the negative effects are quickly exported to Panama.

...Of the jobs that the Fed claims they have created by printing $3.7 trillion over the last few years, zero of those have ended up in Panama.

...So to get a true sense of US dollar inflation… and where it’s headed in the Land of the Free… one only need look at dollarized countries like Panama."

http://www.sovereignman.com/trends/no-inflation-friday-dollarized-panama-issues-price-controls-for-basic-goods-14752/

7/24/14

Reuters, Wed Jul 23, 2014; "Iran's supreme leader calls for end to 'murderous' Israeli regime"

"Iran's supreme leader Ayatollah Ali Khamenei ...called for a referendum canvassing the Arabs and Jews that live in Israel in order to end the "Zionist state", but said until such a vote could be held, armed resistance was necessary.

Attack until they surrender, die and leave.

Khamenei and his predecessor the Ayatollah Rouhollah Khomeini have called repeatedly over the years for an end to the Jewish state...

Kill them until Israel is no more.

..."There are logical and practical means to this end, which is for people who live and belong there to pick the government of their choice through a referendum. That would be the end of a usurping fake regime," Khamenei, who has the last word in all matters in Shi'te Muslim Iran, said in a speech to university students in Tehran.

Until then, Khamenei said, "while waiting for an end to this cold-blooded murderous regime, mighty armed resistance is the only way to deal with it."

Kill them until they leave.

..."Israel's annihilation is the only real cure..."

http://www.reuters.com/article/2014/07/23/us-palestinians-israel-iran-idUSKBN0FS2E520140723

7/23/14

Is Ben Holder's contract with Greensboro, as a subcontractor, legal?


Whitney Kenerly, Yes Weekly, July 23, 2014 

"When the NC General Assembly voted in June to amend the state’s rental inspection law, it appeared to spell the demise of RUCO, short for Rental Unit Certificate of Occupation, a model program in Greensboro that proactively inspected rental properties...

https://docs.google.com/file/d/0B9h2K8JxTQUjeHoydmRIenRpOGlCbGdVNlRMRzdZaEIzRnZn/edit

The Greensboro City Council has drawn heat for opting to remain silent on the issue on the eve of a critical Senate vote.

...The new law amended a section of state law pertaining to building inspections in cities and counties, prohibiting them from making periodic inspections for “unsafe, unsanitary or otherwise hazardous and unlawful conditions in buildings” without reasonable cause.

Which appears to be what Ben was hired to do.

......the legislation appeared to be directed at “periodic inspection programs of local governments,” and suggested a possibility that “local city or county residential inspection program ordinances organized under different enabling authority” might not be affected.

For example, he said, cities might want to explore with their attorneys whether rental inspection programs established on the authority of a part of state law pertaining to minimum housing standards, as opposed to a separate part about building inspections, “remain viable.”

Tom Pollard, interim city attorney for the City of Greensboro, released his opinion on the viability of RUCO to Mayor Bill Knight and members of city council in late August. Pollard said he had discussed the new ramifications of the new law with a faculty member at the UNC School of Government in Chapel Hill, and told council: “I have concluded that these clear prohibitions apply to the city’s RUCO ordinance, regardless of the adopting authority.”

https://docs.google.com/file/d/0B9h2K8JxTQUjeHoydmRIenRpOGlCbGdVNlRMRzdZaEIzRnZn/edit

What if the proactive inspections originate with a subcontractor?

Tyler Mulligan, a professor of public law ...addressed the question...: “Minimum Housing: A Way Around Residential Inspection Limits?” Even assuming that the two sections of state law “provide separate authority for minimum housing public officers to conduct periodic inspections — a court is likely to resist an interpretation that allows minimum housing public officers to get around the reasonable-cause provisions of the rental inspection law,” he wrote.

Is a subcontractor a "public officer"?

...the statutes for North Carolina’s minimum housing standards law, which authorizes cities and towns to exercise police powers and declares that “the existence and occupation of dwellings in this state that are unfit for human habitation are inimical to the welfare and dangerous and injurious to the health, safety and morals of the people of this state.”

...the statute amended by the General Assembly refers to “building inspectors” while the statute that provides the enabling authority for RUCO refers to “public officers.”

...Nancy Hoffmann [who is now a landlord]...said RUCO had been successful and had improved the city’s housing inventory, but she appreciated that landlords might have a different perspective.

Jim Kee and Zack Matheny...echoed criticism that city staff is inspecting the same properties over and over again.


...Robbie Perkins said, “It’s hard to cry over spilt milk. If the state legislature decides they’re going to put a program out of business, then they’ve got the authority to do that. I think the question is, where do we go from here?” Perkins proposed reducing the territory for which each inspector is responsible..."

http://yesweekly.com/article-permalink-13052.html
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Has the City of Greensboro concluded subcontractors can proactively inspect?

I hope so.

VALIC provided 457 Plan Fee Disclosure for a North Carolina Municipality


The US Federal Government's Thrift Savings Program Fund Comparison Matrix; Average Fund Expense Ratio = 0.03%

http://hartzman.blogspot.com/2014/06/the-us-federal-governments-thrift.html

Some ICMA-RC 457 Plan Fee Disclosure from some different local Municipalities

http://hartzman.blogspot.com/2014/07/some-icma-rc-457-plan-fee-disclosure.html

The City of Greensboro's 457 Retirement Plan, Its Stable Value Fund, and How to give City Employees a Raise

http://hartzman.blogspot.com/2013/05/the-city-of-greensboros-457-retirement.html

National Association of Counties Nationwide Insurance provided 457 Plan Fee Disclosure for a North Carolina Municipality

http://hartzman.blogspot.com/2014/07/national-association-of-counties.html

On fees for ICMA-RC's VantageTrust PLUS Fund charged to the City of Greensboro

http://hartzman.blogspot.com/2014/07/on-fees-for-icma-rcs-vantagetrust-plus.html

A Few Observations on Share Classes and Wells Fargo Stable Return Fund

http://hartzman.blogspot.com/2014/06/a-couple-of-observations-on-share.html

On the State of North Carolina's 401k plan Stable Value Fund; Could be a $4,844,452.19 annual increase for North Carolina's employees

http://hartzman.blogspot.com/2014/06/on-state-of-north-carolinas-401k-plan.html

City of Greensboro 457 Plan Proposal;

http://hartzman.blogspot.com/2013/06/city-of-greensboro-457-plan-proposal.html

Stable Value Fund Expenses; ICMA-RC VT PLUS Fund - 1.38%

http://hartzman.blogspot.com/2014/07/stable-value-fund-expenses-icma-rc-vt.html

National Association of Counties Nationwide Insurance provided 457 Plan Fee Disclosure for a North Carolina Municipality


The US Federal Government's Thrift Savings Program Fund Comparison Matrix; Average Fund Expense Ratio = 0.03%

http://hartzman.blogspot.com/2014/06/the-us-federal-governments-thrift.html

Some ICMA-RC 457 Plan Fee Disclosure from some different local Municipalities

http://hartzman.blogspot.com/2014/07/some-icma-rc-457-plan-fee-disclosure.html

The City of Greensboro's 457 Retirement Plan, Its Stable Value Fund, and How to give City Employees a Raise

http://hartzman.blogspot.com/2013/05/the-city-of-greensboros-457-retirement.html

On fees for ICMA-RC's VantageTrust PLUS Fund charged to the City of Greensboro

http://hartzman.blogspot.com/2014/07/on-fees-for-icma-rcs-vantagetrust-plus.html

A Few Observations on Share Classes and Wells Fargo Stable Return Fund

http://hartzman.blogspot.com/2014/06/a-couple-of-observations-on-share.html

On the State of North Carolina's 401k plan Stable Value Fund; Could be a $4,844,452.19 annual increase for North Carolina's employees

http://hartzman.blogspot.com/2014/06/on-state-of-north-carolinas-401k-plan.html

City of Greensboro 457 Plan Proposal;

http://hartzman.blogspot.com/2013/06/city-of-greensboro-457-plan-proposal.html

Stable Value Fund Expenses; ICMA-RC VT PLUS Fund - 1.38%

http://hartzman.blogspot.com/2014/07/stable-value-fund-expenses-icma-rc-vt.html