States Scramble While Another Big Flush Is Executed

The manner in which California ‘solves’ its fiscal problems will likely be the template for other cash strapped States. If California (and other States) can’t agree on meaningful spending cuts, a move that carries consequences in terms of consumer spending at the national level, screams for additional Federal fund will only get louder as the year progresses.

Headline: State Budget Deficits Force Painful Choices

The nation's governors are facing budgets that are trillions of dollars in the red. A new CBS News poll shows nearly three out of four Americans think their state budget is in bad shape. An overwhelming majority is not willing to cut spending for public safety. Of all the states, California is in the tightest squeeze.

CBS News correspondent Terry McCarthy reports California's new governor, Jerry Brown, inherited one of the worst state financial messes in the country. Brown began announcing cuts from day one. His first target: the cell phone.

Forty-eight thousand state workers with taxpayer funded cell phones must turn them in by next June and that includes the governor himself.

"I have [the cell phone] in my desk ready to turn in," said Brown.

With a deficit of $28 billion, eliminating cell phones will only save the state $20 million.

Source: cbsnews.com

Nothing has changed. Weakness in gold reflects another "Big Flush" setup before the next advance. The "rethink long gold trade" in 2011 will be pushed as long as TIME permits.

Gold London P.M Fixed and the Commercial Traders COT Futures and Options Stochastic Weighted Average of Net Long As A % of Open Interest


Thanks Bob