Wednesday morning headlines

Market edges downward: The Dow made up its 2009 losses after yesterday's trading. This morning, stocks are off almost 100 points.

Job losses slowing: Another one of those bad-but-not-horrible reports. ADP says private-sector employers cut 532,000 jobs in May, a 2.4 percent improvement from the revised 545,000 drop in April. The payroll service says employers will likely cut jobs for the next couple of months, but not as quickly as in the past six months. (AP)

Bernanke worries about deficit: The Fed chief is telling Congress this morning that somebody will need to start paring down that $1.8 trillion. That's on top of the $11 trillion national debt. No wonder the markets are down. (NYT)

Not just California: Lots of states are running into serious budget problems - altogether, aggregate shortfalls will total at least $230 billion from fiscal 2009 through fiscal 2011. That's nearly double the federal stimulus funds that states can use over three years. From the WSJ:

State tax collections could take five years or more from when the recession began in December 2007 to recover to prerecession levels, says Donald J. Boyd, senior fellow at the Nelson A. Rockefeller Institute of Government at the State University of New York. In addition, revenues appear to have grown more sensitive to the business cycle in the past decade, in part because capital-gains taxes have become a bigger component of tax bases, according to new research by Federal Reserve Bank of Chicago economists Leslie McGranahan and Richard Mattoon. That could prolong the effect of the downturn and, by increasing volatility, make it harder for states to plan budgets.

Mozilo complaint nears: Daily Journal (no link) reports that the SEC may file civil fraud charges against former Countrywide Financial CEO Angelo Mozilo as early as this week. Also, a federal prosecutor has stepped up a criminal inquiry into Mozilo's stock sales, says the newspaper, citing sources.

The SEC complaint is expected to name Mozilo, former chief operating officer David Sambol and former chief financial officer Eric Sieracki, with a focus on Countrywide's financial disclosures. In particular, the complaint is said to allege Countrywide executives violated securities laws by not disclosing more about relaxed lending standards in its 2007 annual financial report.

Starbucks wins tip dispute: A state appellate court in San Diego wiped out a $106 million judgment against the coffeehouse giant, ruling that the company's system for divvying up tip-jar cash did not violate California labor law. From the SD Union-Tribune:

In 2004, barista Jou Chau sued the Seattle-based company over its policy of allowing tips to be shared among baristas, who work the counters, and shift supervisors, who do that work plus other tasks. State law generally bans "agents," or managers, from sharing in tips left for workers. Last year, San Diego Superior Court Judge Patricia Cowett ruled Starbucks had violated that law because shift supervisors' duties qualified them as agents under the law. In yesterday's reversal, Justice Judith Haller wrote there was a legal distinction between tips left for individual workers and those dropped in a "collective" tip jar.

Restricting health insurers: California Insurance Commissioner Steve Poizner is proposing regulations that would make it harder for insurance companies to rescind coverage. (Poizner is running for governor). From the LAT:

Consumer advocates said the rules would make it virtually impossible for insurers to drop people over innocent mistakes, omissions and misunderstandings. Insurers said they were reviewing the proposal. Poizner said it would "deliver a dose of preventive medicine for rescissions."

Drama at TV Guide: CEO Scott Crystal, who resigned over the weekend, claims in an e-mail that the current owners, L.A.-based Open Gate Capital, are engaged in a scheme that will siphon away millions from the magazine. Open Gate acquired the magazine late last year - well, "acquired" is kind of pushing it. The firm paid $1 from the previous owner, Macrovision, which then agreed to lend Open Gate $9.5 million. (NY Post)