2 days ago

COLUMBUS, Ohio (AP) — Ohio State University on Tuesday dropped its review of car purchases by football players and family members after two separate investigations found dealerships made money on almost all of the sales.

The university made its decision in light of a report by the Ohio Bureau of Motor Vehicles and a separate review by the Ohio Independent Automobile Dealers Association.

“We have seen no evidence that would lead us to believe that Ohio State student athletes violated any policies when purchasing used cars,” said university spokesman Jim Lynch.

The reviews were launched after questions about players’ car purchases arose in the wake of a scandal in which some players received cash and tattoos for autographs, championship rings and equipment.

In a 65-page report issued Tuesday, the state BMV said two Columbus-area dealerships made money on 24 of 25 sales made to players and family members.

The BMV, however, did not interview Ohio State players or officials and did not examine records of financial transactions that players file with the university’s athletic compliance office. The report also did not address whether players received discounts not available to the public. Such a discount could be an NCAA violation.

Jason Goss, owner of Columbus-dealership Auto Direct, said Tuesday that players who bought cars from him did not receive discounts not available to the public.

“Absolutely not,” he said.

“I know what was in our deals. I know what we sold the cars for and what we paid for the cars,” Goss said. “What we made was a normal profit that we would make on any customer that would come here.”

In its report, the BMV said the certificates of titles for 25 vehicle sales by Jack Maxton Chevrolet and Auto Direct to Ohio State players and their families accurately reflected the vehicles’ sales prices.

According to the report, Auto Direct made money on the 10 vehicles it sold to players and their families and Jack Maxton made money on 14 of 15 sales; one vehicle was sold at a loss because it had been on the lot longer than 150 days.

A BMV investigator found vehicles bought at Auto Direct were sold for an average of $2,000 over their wholesale purchase prices, the report said.

Auto Direct owner Jason Goss told an investigator “he is not in the business to sell vehicles at a loss and has never discounted the price of vehicle in lieu of sports memorabilia or anything related to O.S.U. athletics.”

The BMV investigation found no evidence that tickets and/or sports memorabilia were included in the sales.

“The deals that I did for Ohio State student-athletes were no different than any of the other 10,000-plus deals that I’ve done for all my other customers,” said Aaron Kniffin, the salesman who sold most of the vehicles at both dealerships, in a May 10 affidavit.

Kniffin said any sales involving Ohio State players were forwarded to the general manager, who contacted Ohio State’s compliance office.

The review by the independent auto dealers association of Auto Direct sales found no evidence of improper titling or sales tax calculations and said the paperwork on all sales complied with state and federal laws.

All vehicles were sold at fair market value and profit margins were consistent with the company’s average profit per unit and the national average for used car dealers, James Mitchell, OIADA executive director, said in a May 18 letter to Goss released Tuesday by Ohio State.

There “was no preferential treatment,” Mitchell wrote.

Ohio State President Gordon Gee said Tuesday the BMV’s findings weren’t surprising.

“The university has a very strong compliance system,” he said. “We have always tried to make certain that we are on solid ground on these issues.”

Gee added: “That doesn’t mean to say we’re not going to be surprised once in a while.”

A lawyer for former Ohio State quarterback Terrelle Pryor said the BMV report confirms Pryor never received special treatment in his dealings with Auto Direct, which included a repair on one of Pryor’s cars and a $11,435 purchase of a 2007 Nissan by Pryor’s mother.

“There has been no testimony from any credible source that any OSU Student Athlete received special benefits beyond those that any customer received in having their car repaired or in considering the purchase of a vehicle,” attorney Larry James wrote in a memo Tuesday to Doug Archie, Ohio State’s athletics compliance director.

Pryor was one of five players suspended for the first five games of the 2011 season for taking money and tattoos from local tattoo-parlor owner Edward Rife, who signed an agreement in May to plead guilty to federal drug trafficking and money-laundering charges.

Pryor announced earlier this month he wouldn’t return for his senior year. He is now aiming to be selected in the NFL’s supplemental draft this summer.

The BMV report also addressed what it called “persistent allegations” that Ohio State athletes and coaches have been allowed to drive dealer-owned cars using dealer license plates.

That practice is not illegal and is allowed under BMV rules, the agency said.

“On the contrary, the statute that governs the use of dealer-plated vehicles by third parties expressly permits dealers to allow any member of the public to operate dealer-owned vehicles,” the agency said in its report.

In a May 12 interview with the Ohio Inspector General, Kniffin said Jeff Mauk, owner of Jack Maxton Chevrolet, received tickets from Ohio State coaches for giving them cars to drive. Kniffin said that was a common practice, according to the interview included in the BMV report.

A message was left for Mauk seeking comment.

Andrew Welsh-Huggins can be reached at http://twitter.com/awhcolumbus.

Copyright © 2011 The Associated Press. All rights reserved.

2 days ago

COLUMBIA, S.C. (AP) — South Carolina will not fund the state GOP’s first-in-the-South presidential primary in February, leaving officials scrambling to sort out who will pay for it.

The Republican Party insists the primary will go on, even if the GOP must come up with as much as $1.5 million to run it.

“In no way is this primary in jeopardy,” said Matt Moore, the state GOP’s executive director.

The party could go back to running the primary with paper ballots and volunteers, which is how it was done until 2008. That year, Republicans and Democrats pushed for and won state funding for the wide-open White House primaries and the state election commission started running them.

But Republican Gov. Nikki Haley, a conservative who has been making a name for herself nationally, insists that taxpayer funds be used only for what she calls core functions. She told lawmakers earlier this year that those functions don’t include primaries.

“Political parties have sufficient fundraising ability to offset the costs of partisan presidential preference primaries, and in a budget year like this one, it is my ask that we do not dedicate taxpayer dollars to something I believe does not rise to the level of a core function of government,” she wrote in a letter in March.

A measure that would have allowed the election commission to run the primaries and bill the GOP was axed last week during final budget negotiations.

On Friday, the election commission asked the attorney general whether it can use leftover money from last year’s elections– $680,000 at most — to pay for the primary, said agency spokesman Chris Whitmire. The attorney general has not yet offered an opinion.

Despite Haley’s objections, the state GOP has been persistent in asking for state funding for the primary, including during budget negotiations.

The GOP “outreach last week sought to make clear that state involvement is wise to ensure the election is fair and unbiased,” Moore said.

He said the primary will go on even if Haley vetoes plans to use leftover election commission money.

“That’s the governor’s prerogative. We respect that,” Moore said. “No matter what, we’re going to put on this primary. We’re committed to raising any funds beyond what the state may provide.”

The GOP already has raised $125,000 through filing fees from five candidates and will pick up $35,000 on Wednesday when former Utah Gov. Jon Huntsman drops off his as he launches his presidential bid, Moore said.

Still, the party would have to raise a lot more either to run a primary on its own or supplement the cash the Election Commission has. The GOP’s latest state and federal financial reports show it has nearly $137,000 on hand. An exact date for the primary has not been set.

Copyright © 2011 The Associated Press. All rights reserved.

* Dollar funding costs ease, but pressure can come back
* Greek deal edges closer but situation still shaky
* Restructuring talk seen intensifying even after a new deal

By Marius Zaharia

LONDON, June 17 (Reuters) - Dollar funding costs for euro
zone banks retreated from multi-month highs on Friday as the
blocs key policymakers looked closer to agree on how to bail
out Greece, but interbank stress was likely to persist.

Germanys Angela Merkel and Frances Nicolas Sarkozy, long
at odds over how to involve the private sector in a new aid deal
for Greece, said they had found common ground in the so-called
Vienna Initiative -- a voluntary deal by banks to maintain
their exposure. [ID:nLDE75G0JV]

The one-year euro/dollar currency basis swap spread
EURCBS1Y=ICAP, which expands when banks become less willing to
supply dollars to each other, narrowed to 29 basis points from
Thursdays 37 bps, the widest level in four months.

But risks remain in the short-term, with the Greek
government facing a no confidence vote next week which may
complicate the attempt to reach a bailout agreement in time to
plug a financing gap next month.

In the longer run, economists say talk of losses being
imposed on private Greek government bond holders could reignite
again if the country does not meet its ambitious fiscal and
privatisation targets and the swap can still test levels seen in
May 2010, just before its first bailout deal was agreed.
Weve narrowed a bit (in FX basis spreads) today, but we
are now looking for new equilibrium levels in the spreads and
those are generally at wider levels than before, said Benjamin
Schroeder, rate strategist at Commerzbank.

I could imagine some scenarios where we could hit (the May
10 levels) again -- if they cant form a new government, if they
cannot implement austerity measures then the next tranche of the
new package would be an issue.

Eurodollar futures rose 4-5 bps higher across the 2011 strip
lt;0#ED:gt; after the Merkel-Sarkozy meeting, recovering some of the
sharp falls seen earlier this week.

But Philip Tyson, head of rates strategy at MF Global, said
funding pressures were likely to remain as Greeces situation
was still vulnerable and can deteriorate quite rapidly

(The falls) weve seen over the past few days have been
just the start of the process. People have been comparing (the
potential stress in money markets from a Greek default) to
Lehman and yes, it can be huge because of the Greek contagion.

Weve recommended this morning a put spread for the
December eurodollar contract at 99.25 and 99.00 from the current
99.55 just in case we start seeing yet more pressure in these
markets, he said. EDZ1

MECHANISMS IN PLACE

However, Tyson said that while stress indicators such as
eurodollar futures and cross currency spreads could reach levels
seen in 2010, both the European Central Bank and the Federal
Reserve have mechanisms in place to avoid levels seen at the
height of the Lehman crisis at the end of 2008.

The ECB has a dollar swap line with the Fed which can be
activated, while it continues to provide euro zone banks with
unlimited euro liquidity.

Abundant ECB cash is the reason why the spreads between
Libor and Overnight Index Swaps -- a traditional gauge of
counterparty risk -- have been stable at around 12 bps this
week, compared with 25 bps in May 2010 and over 100 bps in 2008.

Morgan Stanleys head of European rates strategy Laurence
Mutkin prefers spread wideners in cross currency markets to
Libor/OIS wideners as a way to hedge against financing markets
stress because the latter are kept low by ECB liquidity
facilities, which makes the former a better risk proxy.

The stress in dollar funding markets is likely to be higher
than that in euro funding markets because the ECB can more
easily ensure the supply of abundant cash to European banks,
Mutkin said.
(Editing by Catherine Evans)

Newly introduced legislation would require U.S. government money spent on state and local transportation projects be repaid before the assets are leased or sold to private operators, potentially crimping an ongoing national push toward privatization.

The bill, by U.S. Sen. Dick Durbin (D., Ill.) ensures “that the interests of the federal taxpayer are protected when a private company seeks to operate a public asset for a profit,” Durbin said in a prepared statement Friday.

He singled out in particular the potential privatization of Midway airport in Chicago, …

Three California prisoners received “medical parole” this week, earning release simply because of their poor physical condition — including a inmate who has served fewer than four years of a 68-year sentence for a home invasion.

The decisions stem from a new state law that allows the release of medically incapacitated inmates to save the state money. These prisoners have to face “dire” health conditions and can no longer be a threat to their communities.

Craig Lemke, the first inmate to win release under the law, had been convicted of tying an elderly couple together after he broke into their home in 2006, but the parole board deemed that he is no longer considered a threat to public safety because of his poor medical state, the Los Angeles Times reported.

Under the law, if his condition improves, he would need to return to prison, the Times reported. Prison officials would not comment on the condition of Lemke.

The state, which is struggling financially to support its large prison population, passed the law in September with the hope of saving the state millions.

The Sacramento Bee reported that Lemke was so ill, he cost taxpayers $750,000 a year to guard him at a long-term care facility, and that doesnt include the medical costs.

Two others were cleared for release Thursday under the law, the Bee reported: Juan Garcia Sandoval, 78, who was sentenced to 27 years in prison, and John Joseph Swesey, 72, serving a 24-year sentence.

The decision come as the state faces pressure to solve its prison crowding problem. In May, the US Supreme Court ordered the state to remove more than 33,000 inmates after the justices ruled easing congestion is the only way to improve unconstitutionally poor inmate medical and mental health care.

Ken Gregory, a lawyer in California, called the California prison overcrowding a complicated issue that requires many changes.

“I think this solves a part of a much bigger problem,” he said.

The board previously denied medical parole to a paralyzed rapist, the Times reported. The board considered him a threat because he could still speak.

Lemke, 48, was the second inmate considered for such release.

David Gilkey/NPR

Darryl St. George, a Navy corpsman with Weapons Company 2/8 Marines out of Camp Lejeune, N.C., walks along a mud compound wall with Afghan National Army soldiers while on a foot patrol in northern Marjah, Helmand province, southern Afghanistan.

text size A A A

June 17, 2011

As budget concerns multiply, money worries have entered the debate over foreign policy strategy.

Some policymakers cite fiscal savings as one compelling reason to begin a serious withdrawal of troops from Afghanistan next month.

And the Obama administration has had to be fairly modest in its diplomatic efforts regarding the emerging democracies of the Middle East and North Africa. Its proposed $2 billion aid package for Tunisia and Egypt falls far short of being a new Marshall Plan.

“The United States is caught in a vise where an incredible fiscal conservatism is working hard at rolling back deficits, and this is impacting foreign policy considerations in very serious ways,” says Steve Clemons, a foreign policy strategist at the New America Foundation.

In Search Of A Constituency

Foreign assistance is never as politically popular as programs that benefit, say, farmers or schoolchildren. At a time when budgets are being cut, political logic seems to dictate cutting programs that mainly benefit people overseas. Especially in countries that lawmakers have grown wary about, such as Pakistan.

There’s no political constituency to keep foreign assistance alive. The public thinks that foreign assistance makes up 30 percent of the budget, when it’s one percent.

- Mark Helmke, a spokesman for Sen. Richard Lugar (R-IN)

“There’s no political constituency to keep foreign assistance alive,” says Mark Helmke, a spokesman for Richard Lugar of Indiana, the senior Republican on the Senate Foreign Relations Committee. “The public thinks that foreign assistance makes up 30 percent of the budget, when it’s 1 percent.”

A Bloomberg National Poll in March suggested that more than 70 percent of Americans believe slashing foreign aid and pulling troops out of Iraq and Afghanistan would make a substantial dent in the deficit. Fewer than half believed the same thing about cutting Medicare or Social Security benefits, which make up a far larger share of the federal budget.

“The wars in Iraq and Afghanistan and the extension of the United States around the world militarily are losing their political salience,” says Gordon Adams, an American University foreign policy professor who helped oversee the defense budget during the Clinton administration.

“People don’t like the wars,” Adams says. “Iraq is done, as far as we’re concerned. If you go into polling, what really matters to people is jobs, the state of the economy, the debt and the deficit.”

Cuts To Foreign Aid Spending

The State Department’s budget has doubled over the past decade, thanks to wars and concern about terrorism.

The Obama administration began with the hope that some of the flood of money still gushing toward the Pentagon could be redirected toward State, to strengthen diplomacy and development efforts alongside defense.

Secretary of State Hillary Clinton has warned Congress that serious fiscal constraints on this strategy would be “devastating to our national security.”

The budget agreement that averted a government shutdown in April cut spending for State and foreign operations. The cut was only $500 million from the previous year’s level, but it was $8.4 billion less than President Obama had proposed.

Further cuts are expected this year. On Wednesday, the House voted to cut foreign food assistance by 26 percent from current levels, although it rejected an amendment that would have eliminated funding for the Food for Peace program altogether.

‘We Just Can’t Afford It’

People don’t like the wars. Iraq is done, as far as we’re concerned. If you go into polling, what really matters to people is jobs, the state of the economy, the debt and the deficit.

- Gordon Adams, an American University foreign policy professor

Dollars are also starting to drive the debate about Afghanistan. A small but growing number of Republicans are calling for a swifter troop withdrawal than the Obama administration is expected to propose next month, in part because of budget concerns.

“What’s animated a lot of the conservative discussion is that it’s costing so darn much,” says Clemons, the New America senior fellow. “Money has been the pathway of conservative dissension.”

Jon Huntsman Jr., the former Utah governor and ambassador to China, is expected to announce his bid for the GOP presidential nomination on Tuesday. He made clear his concerns about the financial cost of war in an interview this week with Esquire.

“If you can’t define a winning exit strategy for the American people, where we somehow come out ahead, then we’re wasting our money and we’re wasting our strategic resources,” Huntsman said, referring to Afghanistan.

Regarding Libya, he said he never would have entered into the campaign.

“We just can’t afford it,” he said.

Spending In Afghanistan

Ronald Neumann, who served as U.S. ambassador to Afghanistan from 2005 to 2007, takes issue with the idea that budgetary concerns should shape American strategy in the war.

“This suggests we could lose the war for the wrong reasons,” he says.

Characterizing a viewpoint he opposes, Neumann says, “This war is really important — it’s really important that we keep Americans there, some of whom die, and we kill people — but if it costs too much, it’s not worth it.”

But financial considerations are an inevitable part of the calculation, says Rajan Menon, an international relations professor at Lehigh University and skeptic of the administration’s Afghanistan strategy.

Spending $10 billion per month on the war is already a tough sell, given the state of the domestic economy, and will become even more dicey if the economy heads south, Menon says.

“Afghanistan is now costing more per month than Iraq,” Menon says. “This to me is an unsustainable burden.”

Strategy Wears A Dollar Sign

The debate over money for foreign policy will continue to take many forms. Many observers note that there is a limit to how much help countries such as Egypt can “absorb” without it having a distorting or even corrupting effect on its own economy.

“One has to be careful about saying budgetary considerations are the only factor here,” says Anthony Cordesman, a national security analyst at the Center for Strategic and International Studies.

Some will argue that much of the money spent abroad is wasted, while others will contend that the U.S. provides foreign aid because it’s in America’s national security interest to do so.

For his part, Cordesman worries that American foreign policy could become pound foolish — that by not spending the money to combat a crisis in a particular country, the U.S. will end up confronting a worse crisis later.

“You end up wasting money in the guise of saving it,” he says.

Getting Ready For A Hit

The impulse will be to cut back further in the coming years, not just because of concerns about the deficit, but because the military presence in Afghanistan and Iraq will shrink, says Adams, the American University professor.

“When the U.S. finishes military engagements, whether in Korea or Vietnam, you see reductions in the foreign policy budget as well, sometimes sharper than for the military,” he says. “Sadly, I think that’s what’s going to happen here.”

But as the military footprint begins to shrink, greater responsibility will fall to the State Department.

“It’s evident that the American profile in both Iraq and Afghanistan is going to move from the Defense Department to the State Department account,” says Helmke, the spokesman for Lugar. “And the State Department account is usually whacked.”

House Republicans are planning to shift funds around to prioritize foreign aid spending in Iraq and Afghanistan. House appropriators plan to spend just under $40 billion for State and foreign operations this year, which would represent a cut of $8.6 billion. But, counting the money shifted to war-related spending, the net reduction is about $1 billion.

 

Unclaimed money: Do the search, but watch out for fees

Unclaimed money in the United States runs into the billions of dollars. But if you go searching for unclaimed money, do it yourself – at least at first.

* Money fund managers may still be wary of European banks

* Libor fixes unchanged from Thursday, but off record low

* Eurodollar futures see price gains after selloff

By Emily Flitter

NEW YORK, June 17 (Reuters) - The anxiety that spurred bets
on an increase in interbank lending rates and a selloff in
eurodollar futures earlier this week receded on Friday as
European leaders discussed a deal to help Greece avoid
default.

The dollar London interbank offered rate, the rate at which
banks are willing to lend to one another, set at 0.2465 percent
on Friday, steady from Thursdays level, halting its brief rise
from a record low.

You definitely saw an increase in concern about the
exposure of European banks to Greek debt and theres some talk
out there about money funds being a little bit less willing to
fund them, said Scott Sherman, interest-rate strategist at
Credit Suisse in New York.

Earlier in the week we were seeing Libor go a little bit
higher, with expectations in the eurodollar market. Today those
rates are down on the front end, so it looks like that concern
has come off a little bit.

Germany Chancellor Angela Merkel and French President
Nicolas Sarkozy, long at odds over how to involve the private
sector in a new aid deal for Greece, said they had found common
ground in the so-called Vienna Initiative -- a voluntary deal
by banks to maintain their exposure. [ID:nLDE75G0JV]

Roseanne Briggen, an analyst at IFR Markets, a unit of
ThomsonReuters, in New York, reported a tightening of swaps by
half a basis point to 2.5 basis points, along with higher
eurodollars.

Its like a big relief, Briggen said. The panic came out
of the market.

Eurodollars were still up on the day. The front eurodollar
contract -- September -- hit a high of 99.63 on Friday. It fell
as low as 99.57, and was last at 99.60.

But the Greek government faces a no-confidence vote next
week, which may complicate the attempt to reach a bailout
agreement in time to plug a financing gap next month, leaving
short-term markets vulnerable to more turmoil.

Its almost like people are thinking Greece is too big to
fail. Not in terms of its size and importance in the global
economy, but in terms of its importance in the market, Briggen
said. The IMF and the EU, theyd never allow it to fail.
(Additional reporting by Marius Zaharia in London; Editing by
Leslie Adler)

May 27, 2011

NEW YORK (AP) — There’s less money this summer for hotel rooms, surfboards and bathing suits. It’s all going into the gas tank.

High prices at the pump are putting a squeeze on the family budget as the traditional summer driving season begins. For every $10 the typical household earns before taxes, almost a full dollar now goes toward gas, a 40 percent bigger bite than normal.

Households spent an average of $369 on gas last month. In April 2009, they spent just $201. Families now spend more filling up than they spend on cars, clothes or recreation. Last year, they spent less on gasoline than each of those things.

Jeffrey Wayman of Cape Charles, Va., spent Friday riding his motorcycle to North Carolina’s Outer Banks, a day trip with his wife. They decided to eat snacks in a gas station parking lot rather than buy lunch because rising fuel prices have eaten so much into their budget over the past year that they can’t ride as frequently as they would like.

“We used to do it a lot more, but not as much now,” he said. “You have to cut back when you have a $480 gas bill a month.”

Alex Martinez, a senior at Arcadia High School outside Los Angeles, said his family’s trips to San Francisco, which they usually take once or more a year, are on hold. As he stopped at a gas station to put $5 of fuel in his car — not much more than a gallon — he said the high prices are crimping social life for him and his friends.

“We’re always worrying, ‘How are we going to get home. We’ve got less than half a gallon left,’” Martinez said. “We definitely can’t go out as much, and we can’t go as far.”

As Memorial Day weekend opens, the nationwide average for a gallon of unleaded is $3.81. Though prices have drifted lower in recent days, analysts expect average price for 2011 to come in higher than the previous record, $3.25 in 2008. A year ago, gas cost $2.76.

The squeeze is happening at a time when most people aren’t getting raises, even as the economy recovers.

“These increases are not something consumers can shrug off,” says James Hamilton, an economics professor at the University of California, San Diego, who studies gas prices. “It’s a key part of the family budget.”

The ramifications are far-reaching for an economy still struggling to gain momentum two years into a recovery. Economists say the gas squeeze makes people feel poorer than they actually are.

They’re showing it by limiting spending far beyond the gas station. Wal-Mart recently blamed high gas prices for an eighth straight quarter of lower sales in the U.S. Target said gas prices were hurting sales of clothes.

Every 50-cent jump in the cost of gasoline takes $70 billion out of the U.S. economy over the course of a year, Hamilton says. That’s about one half of one percent of gross domestic product.

The Commerce Department reported Friday that consumer spending rose just 0.1 percent in April, excluding the extra money spent on more expensive gas and food, while wages stayed flat for the second straight month.

Mike Nason, a marketing consultant from Laguna Niguel, Calif., says he’s clipping coupons to save money for gas and cutting back wherever else he can. His daughter Chandler, 17, recently settled for a prom dress that cost $170 instead of asking her parents to spend $400 for another that caught her eye.

“In prior years we would have spent more money on the dress, but money has become a big object,” he says.

The tourism industry is bracing for an uncertain summer. AAA predicts the typical family will spend $692 on its vacation, down 14 percent from $809 last year. Many of those surveyed said they are planning shorter trips and expect to pinch pennies when they arrive.

AAA estimates 34.9 million Americans will travel 50 miles or more from home this weekend, an increase of about 100,000 from last year. But they will have to do more complicated math to make the summer budget work.

The median household income in the U.S. before taxes is just below $50,000, or about $4,150 per month. The $369 that families spent last month on gas represented 8.9 percent of monthly household income, according to an analysis by Fred Rozell, retail pricing director at Oil Price Information Service. Since 2000, the average is about 5.7 percent. For the year, the figure is 7.9 percent.

Only twice before have Americans spent this much of their income on gas. In 1981, after the last oil crisis, Americans spent 8.8 percent of household income on gas. In July 2008, when oil price spiked, they spent 10.2 percent.

Average hourly earnings, meanwhile, have risen just 1.9 percent in the past year. That’s only just enough to keep up with inflation.

The good news is that analysts expect gas to fall to $3.50 a gallon in the coming weeks. In order for household gasoline expenses to return to their historical place in the family budget for the year, gas prices would have to fall by about half and stay that way for the rest of the year.

Demand for gasoline has fallen for eight straight weeks as drivers try to cut back, but higher prices can’t keep drivers parked for long. Even with high prices this year, the government expects gasoline demand to grow slightly for the year.

“Drivers try to do what they can, but they have to go almost all the places they go,” says David Greene, a researcher at the Center of Transportation Analysis at Oak Ridge National Laboratory and manager of the Department of Energy website fueleconomy.gov. “There’s no magic gizmo that will drastically change someone’s gasoline use.”

Mike Siroub clutched his heart as he described the experience of filling up lately. He owns a Union Oil gas station in Arcadia, Calif., but one of his cars is also a 1975 Oldsmobile.

“Think about it,” he said. “If you’ve got a car with a 30-gallon tank and gas is $4 a gallon and you fill it up, you’re out $120.”

He says high gas prices will keep him home this weekend. And he runs a gas station for a living. As he greeted a steady stream of customers at his station, he laughed and said, “I have to pay for gas just like everyone else.”

___

Associated Press writers John Rogers in Los Angeles and Brock Vergakis in Norfolk, Va., contributed to this story.

Jonathan Fahey can be reached at http://www.facebook.com/Fahey.Jonathan .

Copyright © 2011 The Associated Press. All rights reserved.

Illustration: Lou BeachWho says you cant make money online? Prison guards at a Chinese prison camp are reportedly forcing inmates to smash rocks by day and play World of Warcraft at night. The purpose of the all-night WoW sessions is to obtain virtual gold by completing in-game tasks. The prison bosses then turn around and sell the virtual gold in the real world making as much as $930 a day, according to the Guardian. Called gold farming, the practice is not uncommon and its believed as many as 100,000 full-time virtual gold farmers operate in China alone.

But you dont need to supervise a prison to make money online. The Internet is filled with interesting ways to earn a few dollars on the side. If youre not careful, you could also end up losing your shirt. Here are a few of the more unique ways to put some extra dough in your pocket.

Bitcoin Mining

Bitcoin is a popular peer-to-peer, open source virtual currency that experts say is super secure and untraceable. The best part is that until about the year 2040 you can earn Bitcoins simply by dedicating your spare CPU cycles to running a Bitcoin desktop client.

Your computer is tasked with crunching numbers to solve an encryption problem. If your computer solves the problem you get 50 Bitcoins, which is a nice achievement considering the current exchange rate for 1 Bitcoin is hovering around US$8.60 at the time of this writing.

The chance of making a quick buck has sparked an international feeding frenzy among the geek set who are investing in Bitcoin server farms. Problem is, it could take you a year or more using an average computer to earn just 50 Bitcoins, security guru Steve Gibson recently said.

Arts amp; Crafts

Do you know how to macramÃ, knit, sew, or do anything else that requires a weekly trip to a Michaels location? Why not try selling your wares on Etsy.com? Etsy in 2009 sold $180.6 million worth of homemade goods, according to Inc.

Believe it or not, Americans are going wild for knitted latte sleeves and discarded Altoids tins.

If youre worried that you havent got enough talent to sell your crafts online, chances are whatever you make will be better than these Etsy disasters.

Guide the Web

Do you have a knack for searching online, transcribing voice calls, and responding to inquiries quickly? If so, you might be suited to being a ChaCha Guide. ChaCha is a question-and-answer service powered by real people who answer user queries via text messaging and the web.

ChaCha Guides can make anywhere from two cents to 20 cents per task depending on their position. That may not sound like much, but if you work fast enough you could make a little spending money in your spare time and sharpen your research skills in the process.

Play The Market

Thrill-seekers might like to try risking some of their money by playing the foreign exchange markets through sites such as Forex.com.

Basically, what you do is trade one international currency for another in the hope the currency you just bought will go up in value. Its a little like playing the stock market, except you always end up with some form of currency in your hands (even if it is Pesos).

But foreign exchange markets are a tricky business and most people who try it end up losing their investment. If you just want to have fun pretending youre a high-flying investor you can always set up a practice account on Forex.com. But be prepared to get a few sales calls and emails from Forex.com staff if you do.

eBay Power Seller

I had a friend in college who used to make a living picking up unique items at garage sales and flea markets, and then turning around and selling them on eBay. Another friend used to buy spare computer parts on eBay and resell them on his own site. Both made a respectable living based on the old axiom that one mans trash is another mans treasure.

But power selling is serious business, and you can count on it being just as time-consuming as a regular office job if you want to make a living.

Looking for more online moneymakers? Check out ITworlds 6 Strange Ways To Make Money Online.

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