An appeal by Ponzi schemer Bernie Madoff to be released from jail before his sentencing in June was denied this morning. The 2nd U.S. Circuit Court of Appeals in New York City found that "U.S. District Judge Denny Chin did not clearly err when he sent Madoff to prison last week immediately after Madoff confessed that he had defrauded thousands of investors of billions of dollars for at least two decades," the Associated Press reports. Though Madoff pleaded guilty to charges including securities fraud and perjury last week, the 70-year-old and his lawyers hoped he would not be put in jail until his sentencing. The former investment mogul faces up to 150 years in prison.

Remember in January when the Congressional Budget Office forecast a budget deficit of $1.2 trillion for 2009? Well, scratch that. The CBO announced this morning the new forecast is a new record: $1.8 trillion. The extent of negative funds is likely to hinder President Obama's hopes for a 2010 budget plan of $2.55 trillion. Also included in the CBO report: a projected deficit of $1.4 trillion for 2010 and a total of nearly $7 trillion in deficits through 2019.

A pesky side effect of spending your embezzled billions on mansions in the toniest places in the world: The paparazzi already know your neighborhood. Shortly after husband Bernie lost an appeal to temporarily leave jail, Ruth Madoff stepped out of the Upper East Side apartment she is attempting to save from the Feds for a little night shopping. Wool cap on her head and grocery list in hand, Ruth plucked American and Jarlsberg cheese from the racks at her local Food Emporium before expressing frustration with her photojournalistic entourage and storming out. "Oh, this is crazy, forget this!" she exclaimed, according to Page Six. She then switched tactics, to sarcasm: "Oh, very exciting, I went to the grocery store." With her $93 million in assets currently falling under Federal scrutiny, Ruth is unlikely to fly under the radar in any foreseeable future. Before this, Ruth's last known shopping trip was to a corner deli for cigars and the New York Post.

First Lady Michelle Obama, with the help of 26 elementary schoolchildren, broke ground today on the new White House vegetable garden. Included in the crop of foods that will be showcased at official functions, enjoyed by the Obama family, and donated to a local soup kitchen: spinach, broccoli, lettuce, kale, collard greens, and herbs. Also fun? A new beehive at 1600. At the White House this morning, Michelle Obama cheered with the kids: "Let's hear it for vegetables! Let's hear it for fruits!" Then she asked reporters to start shoveling too.

The jobless rate in California—a state that last long been an economic powerhouse, from Hollywood to Silicon Valley to Napa Valley—climbed to 10.5 percent last month. This is the state's highest unemployment rate since 1983, and marks its11th consecutive month of job contraction. Construction was hit the hardest, shedding almost 40,000 jobs in February alone. The television and movie business, lumped into "information" jobs, was the sole industry that did not report layoffs. Government jobs are next to the chopping block, with budget cuts attempting to counter the state's gargantuan deficit taking effect between now and June. LA County's jobless rate is approaching 11%, higher than the state average.

Actress Natasha Richardson didn't get to a hospital until four hours after falling on a ski slope in Quebec, according to the New York Times, citing ambulance records. The new timeline adds almost three hours of gap to the previously reported sequence of events. "The first paramedics to arrive were turned away after Ms. Richardson declined treatment, ambulance records show, though they reported seeing the 45-year-old actress briefly from a distance," the Times reports. "In that instance, they said they saw her sitting on a stretcher - not laughing and walking off her fall, as a resort spokeswoman said on Tuesday." After being transported from Canada, Richardson died from a epidural hematoma in a New York City hospital on Wednesday. The new details add to questions about whether more immediate medical care would have saved her life.

It's not quite Leno, but: The Financial Times reports that “President Barack Obama on Friday issued a widely awaited message to the people and government of Iran in his bid to end a 30-year diplomatic standoff between the US and the Islamic Republic.” The video’s online release coincided with the Iranian New Year. “The US wants the Islamic Republic of Iran to take its rightful place in the community of nations,” Obama said. “You have that right but it comes with real responsibilities and that place cannot be reached through terror or arms, but rather through peaceful actions that demonstrate the true greatness of the Iranian people and civilization.”

The high seas were high drama this morning as a US Navy submarine collided with a US amphibious vessel in the Strait of Hormuz, which lies between Oman and Iran. Fifteen sailors were "slightly injured" in the incident and 25,000 gallons of diesel fuel leaked into the water, according to the Bahrain-based Fifth Fleet. The waterway is strategically important: "An estimated 40 percent of the world's crude oil passes through the strait on the way to market," the AFP reports.

Americans are taking their vacations at home this year. Travel spending declined for the first time since 9/11—off 22 percent in the last quarter, according to the Commerce Department. The result is a shrinking travel industry, with the trillion-dollar tourism sector feeling the pain, and consequently shedding hundreds of thousands of jobs over the past year. Tourism towns are hit particularly hard, with Las Vegas' unemployment now at 10 percent and Myrtle Beach's joblessness at 14 percent. The upside for the few consumers looking for a getaway? Deals are better than ever. Disneyland, for example, is offering free nights at its hotels to lure families to the resort, which has seen occupancy levels slide this year.

Ten American Muslim groups are threatening to break ties with the FBI, saying that federal agents are infiltrating California mosques and pressuring worshipers to become informants. The groups say the "McCarthy-era tactics" also include spreading misinformation and labeling Muslim activists as criminals. An FBI spokesman released a statement encouraging a "continued conversation," but didn't respond to the specific allegations in the Muslim groups' letter. The relationship has been especially strained since Ahmadullah Niazi, an Afghanistan native living in California, was arrested last month in what he claims was retaliation for not becoming an FBI informant.

Has the AIG drama set off a good, old-fashioned witch hunt? The New York Times reports “[AIG’s] executives are toxic, and [their] communities are rattled and divided. Private security guards have been stationed outside their houses, and sometimes the local police drive by.” AIG employees were advised to remain inside their office building in Manhattan while a demonstration was held outside, and to not carry items with the company’s logo. One AIG executive reached for historical parallels: “It is as bad if not worse than McCarthyism,” he said. New York State Attorney General Andrew Cuomo received a list of the names of AIG bonus recipients yesterday, but said they would not be made public in order to protect employees’ safety.

They may be watching you, but who polices the CIA? A recent spate of public scandals—including one high-profile accusation of sexual assault—is forcing a closer look at the secretive organization. Last year Andrew Warren, a CIA officer stationed in the Middle East, was accused of drugging and sexually assaulting two Algerian women. "You have an organization of professional liars," said the former head of the European division. Because nearly 20,000 officers are spread out across the world and have leeway in their actions when recruiting spies—Warren allegedly took his spies to strip clubs and brothels—it’s difficult to regulate their behavior, although a CIA spokesman said, “cases of impropriety are extremely rare.”

Another sign that Sarah Palin is ginning up for 2012: The Anchorage Daily News reports “Gov. Sarah Palin is refusing to accept more than 30 percent of the federal economic stimulus money being offered to Alaska, including dollars for schools, energy assistance and social services.” She said she will accept money for construction projects, but not funds for government. "We are not requesting funds intended to just grow government," Palin said. "In essence we say no to operating funds for more positions in government.” According to the ADN, “The biggest single chunk of money Palin is turning down is about $170 million for education, including money that would go for programs to help economically disadvantaged and special needs students.”

Losing a loved one is a difficult road for anyone, much less a public figure, to navigate. Liam Neeson was in Toronto filming a drama entitled Chloe, when he learned of his wife’s skiing injury and immediately flew to be by her side. The production office of the Atom Egoyan-directed film, which also stars Julianne Moore and Amanda Seyfried, released a statement sharing the actor’s pain, saying, “There are some scenes with Liam Neeson which have not been completed, however, we do not feel this is the time to address that matter. Our concern is for Liam and his family at this difficult time,“ and added that the cast and crew are “bereft.” A number of his projects, including the long-awaited Lincoln biopic, are expected to be put on hold.

“Even if the recession is entirely blamed on capitalism, and it deserves a good share of the blame, the recession-induced losses pale in comparison with the great accomplishments of prior decades,” Nobel-Prize winner Gary Becker and Kevin Murphy write in today’s Financial Times. The duo argues, in fact, that these problems will largely fix themselves: “Given the losses, actors in these markets have a strong incentive to correct their mistakes the next time. In this respect, many government actions have been counterproductive, shielding actors from the consequences of their actions and preventing private sector adjustments.” Of course, one could argue that the government is, in fact, punishing actors for the consequences of their actions and forcing private sector adjustments.

Most high schools send troubled boys to the principal's office, but at South Oak Cliff high school in Dallas, the principal allegedly sent boys to "the cage"—a section of the boy's locker room cordoned off by wire mesh and steel lockers—to settle disputes and discipline students, The Guardian reports. The alleged incidents took place between 2003 and 2005. A former counselor at the school who has filed a whistle-blower lawsuit said, "It was gladiator-style entertainment for the staff," adding "And it was sanctioned by the principal and security." Donald Moten, the school's principal during that time countered, "That's barbaric," and "Ain't nothing to comment on. It never did happen."

President Obama established himself as virtually gaffe-proof during the campaign, but he slipped last night on The Tonight Show when he compared his bowling skills to the Special Olympics. The White House immediately issued a clarification. In other conversations with Jay Leno, Obama compared Washington to American Idol: “Everybody is Simon Cowell," he said. "Everybody's got an opinion. But that's part of what makes for a democracy. You know, it's contentious, people are hitting back." Asked whether AIG executive should go to jail, he said, "Here's the dirty little secret though. Most of the stuff that got us into trouble was perfectly legal. And that is a sign of how much we gotta change our laws."

Does Pope Benedict face a mutiny? Since his installment four years ago, the Pope has un-excommunicated a Holocaust denier, made inflammatory remarks on Islam and homosexuality and, most recently, announced that condoms are a "problem" for AIDS in Africa. Now, his own people are turning on him. One Vatican insider tells The Telegraph the Pope is isolated and fails to consult his advisers, while another calls his papacy "a disaster," and adds, "he's out of touch with the real world." Part of the problem may be that the Vatican's method of slowly releasing information via a PR office that closes every day at 3 pm is obsolete in a new media world. Critics have pointed out that the pontiff needs someone who knows how to Google--a simple search, for example, would have revealed that bishop Richard Williamson had denied the Holocaust.

Let them eat…carrots? Michelle Obama will grace the White House’s South Lawn today for the unveiling of the first kitchen garden on the White House lawn since Eleanor Roosevelt’s victory garden. The 1,100-square-foot project, complete with organic seedlings, fertilizers, and repellants, will soon burst with berries, honey hives, and 55 kinds of vegetables, (including Obama’s favorite, arugula) to feed the First Family.

From the unfortunate names department: The New York Times reports on the plight of Ben Madoff (pronounced MAD-off, not MADE-off, like Bernie). “For months, B. Jeffrey Madoff has received phone calls, dozens and dozens of them, from people who saw the listing for him in the Manhattan directory, figured that he might be the infamous Bernard and decided to tell him off. The calls, Mr. Madoff said, have come ‘at all hours of the day and night,’ generally from ‘people who were either upset or unhinged or both.’” “A surprising number of callers are wounded victims who were just at a loss,” Madoff said. “I feel for them.”

As many as three million people stormed the streets of France yesterday in a protest against President Nicolas Sarkozy's handling of the economic crisis that was organized by union workers, The Independent reports. Union organizers said that this protest beat out the 2.5 million who protested earlier this year, and recent polls show that three quarters of the French public support the protests, underscoring deep public anger at plant closures and corporate excess. The participating unions had a list of demands including a tax hike for the rich and a halt to public sector job cuts. It's a hard sell, though—analysts predict that unemployment will jump to 10 percent before the year's out.