Central Perk: 16 oct. 2010

sâmbătă, 16 octombrie 2010

Mish's Global Economic Trend Analysis

Global Trade Sags; Striking Workers Shut Down Fuel Pipeline to Paris; US Backs Off Currency Manipulation Charges
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32% of Homeowners Expect Home Prices to Drop Next Year, Highest Short-Term Pessimism Ever; Recognition Phase Underway

Global Trade Sags; Striking Workers Shut Down Fuel Pipeline to Paris; US Backs Off Currency Manipulation Charges

Posted: 16 Oct 2010 12:22 PM PDT

With most eyes fixed on Quantitative Easing let's take a look at some global macro events.

World Trade Sags Yet Again

In yet another sign of the slowing global economy, World Trade, Once Rising, Is Starting to Sag Again

THE rapid recovery in world trade after the financial crisis appears to have slowed this spring and summer, raising new concerns about the global economy. Exports of many countries have stabilized at levels well under the peaks reached before the crisis sent world trade into a tailspin.

The accompanying charts show the dollar volume of monthly exports reported by 16 major countries since world trade peaked in July 2008.

The latest American figure is 10 percent below the peak. That compares with figures showing falls of 20 percent or more in most of Europe.

For some interesting currency and trade charts that accompany the above article, please see World Exports Level Off.

Striking Workers Shut Down Fuel Pipeline to Paris

Reuters reports Fuel to Paris reduced as French protests escalate

Striking French oil refinery workers shut down a fuel pipeline supplying Paris and its airports on Friday and airport workers grounded some flights as protests mounted to derail an unpopular pension reform.

France's airport operator played down worries of fuel shortages, but strikes at all of the country's 12 refineries and fuel depot blockades prompted motorists to stock up on petrol.

Truck drivers also were set to join the fray as momentum built for a day of street rallies on Saturday.

The widening protests have become the biggest challenge facing President Nicolas Sarkozy, who is struggling with low popularity ratings as he tries to appease financial markets by stemming a ballooning pension shortfall.

"This movement is deeply anchored in the country," CGT union leader Bernard Thibault told LCI television. "The government is betting on this movement deteriorating, even breaking down. I think we have the means to disappoint them."

"We're filling up at petrol stations to save the fuel we have in depots as much as possible," said one trucker in Paris's southern suburb of Rungis. "But if this carries on, we won't be able to last too long either. We'll have to go fishing."

Polls show two-thirds of people oppose Sarkozy's plan to raise the minimum retirement age to 62 from 60 and change the age at which people can retire on a full pension to 67 from 65.

The government has been at loggerheads with unions for months over the issue and five rounds of strike action since the summer have disrupted public transport and air travel.

French Political Refugee Chimes In

My friend Bruno, a French political refugee has a few insights I would like to share. Bruno writes ...

Hi Mish,

As a former French, now being a political refugee in Thailand, I would like to put things into context.

First, the retirement age is not automatically 60 in France. Only someone who has contributed to a pension plan for 40 years, or more precisely 160 quarters, can retire at the age of 60. Otherwise, the official retirement age is 65.

However, considering that French people have one of the longest life expectancy in the world, it is not rare to see a father and his son both retired, one age 85 or so, and the other between 60 and 65.

Thus, it is not surprising that the pension funds are broke. Until now, the government has been paying for the difference, thanks to a 8% annual budget deficit. But this won't last and the day of reckoning is getting closer and closer.

As far as demonstrators are concerned, All of them belong to public companies: train (SNCF), metro (RATP), air traffic controllers, teachers and so on.

On top of that, they all benefit from special retirement conditions, which they are very afraid to lose. Most of them are entitled to retire between 50 and 55, depending on how terrible their working conditions are!

This too must be factored in, when figuring retirement age.

As for getting rid of these people, don't even think about it! They would not hesitate to destroy the country. The government is afraid of them.

The "PATCO" Solution

Bruno's reply was to comments I made on Tuesday in French Unions On Strike Against Pension Reform, Disrupt Rail, Air Traffic

The correct government response to this mess is to do what Reagan did to the PATCO workers, fire all the public union employees on strike and terminate their benefits.

Moreover, the French government should take this opportunity handed to them on a silver platter and go one step further to make a much needed change and dissolve all public unions. The same should happen in the US.

This would end the nonsense quickly and effectively. As in the US, there would be lines miles long to take those jobs at much lower wage and benefit levels.

Free Lunch Mentality Runs Deep

Bruno thinks the unions would destroy the country if Sarkozy tried what Reagan did. If so, France will be destroyed one way or another because this spending is not sustainable.

U.S. Backs Off Currency Dispute

In what may be pre-election jitters, or perhaps a sign that cooler heads are prevailing, U.S. backs off in currency dispute with China

The Obama administration backed away on Friday from a showdown with Beijing over the value of China's currency that would have caused new frictions between the world's only superpower and its largest creditor.

The Treasury Department delayed a much-anticipated decision on whether to label China as a currency manipulator until after the U.S. congressional elections on November 2 and a Group of 20 leaders summit in South Korea on November 11.

China left little doubt about the rancor that would ensue if it is branded as a currency manipulator -- a largely symbolic move by the United States that would mandate more consultations with Beijing but no immediate penalties.

"The Chinese yuan should not be a scapegoat for the United States' domestic economic problems," Commerce Ministry spokesman Yao Jian said on Friday.

Search for Scapegoats

Regarding scapegoats, I said the same thing on Thursday in Geithner's Search for Scapegoats Avoids the Harsh Truth No One Wants to Hear

Labeling China a currency manipulator would be a big mistake, but it is quite possible after the elections.

The open issue is whether or not Obama would sign such a measure.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List

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Posted: 16 Oct 2010 11:31 AM PDT

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Select Site Demographics from August 2008.

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32% of Homeowners Expect Home Prices to Drop Next Year, Highest Short-Term Pessimism Ever; Recognition Phase Underway

Posted: 16 Oct 2010 09:34 AM PDT

Rasmussen Reports recently released an interesting survey that shows Homeowners Are More Pessimistic Than Ever About the Short-Term Housing Market

A new Rasmussen Reports survey finds that 32% expect the value of their home to decrease over the next year, the highest finding since Rasmussen Reports began asking the question regularly in December 2008.

Just 21% believe the value of their home will go up over the next year.

Looking longer term, people are feeling a bit better. Fifty-two percent (52%) of homeowners say the value of their home will increase over the next five years, the highest level of optimism measured since May.

For the second month in a row, only 55% of homeowners say their home is worth more than their mortgage. A third (33%), however, report that the mortgage is bigger than the home value.

Over half of Americans know someone who has lost their home because they could not pay their mortgage, but just 20% believe that when banks foreclose on a home, it's generally due to unfair lending practices.

Recognition Phase

Some will look at the survey results and see a contrarian indicator. I rather doubt it. I do not think we bottom until homeowners sour on long-term optimism.

Given current conditions, housing inventory, shadow inventory, another jobless "recovery", and changing social attitudes from younger generations, home prices will likely stay depressed for a while.

So instead of the survey being a contrarian indicator, I view these attitudes as part of the recognition phase. Consumers are starting to realize the economic headwinds and what that will do to housing prices in the short-term, even if they have not yet figured out the long-term demographic mess.

Time and Price is the Only Legitimate Cure

The most encouraging sign in the report is that "a majority of Americans continue to oppose any government intervention in the housing market."

The only legitimate cure for what ails housing is price and time. Prices need to fall to the point there is genuine demand. When that happens, the bottom will be in, although appreciation off that bottom will be quite slow.

In the meantime, the Fed's misguided attempt to prop up prices, in conjunction with all the interference by Congress, just stretches out the bottoming timeline.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List

SEOmoz Daily SEO Blog

October's Linkscape Update

Posted: 16 Oct 2010 08:27 AM PDT

Posted by randfish

As many of you likely noticed, Linkscape updated its index on Thursday night. New data is now available in the SEOmoz Firefox and Google Chrome toolbars, Open Site Explorer, the classic Linkscape tool and many of our other SEO tools.

This update was, sadly, just over 2 weeks off schedule, primarily due to some hardware failures at Amazon's EC2 where we run processing on our large link graph to produce the metrics and views for the API. Although we've encountered issues like this in the past, this was one of the larger failures and meant processing had to be restarted several times to update the index. You might be able to read more about the technical details in the near future on our nascent and geektacular Dev Blog.

Index Stats

Pages: 41,219,038,886 (41 Billion)
Subdomains: 436,693,488 (436 Million)
Root Domains: 99,649,652 (99 Million)
Links: 402,521,240,277 (402 Billion)

I made some graphs showing a few interesting trends over the past few months in the web's adoption/use of certain protocols.

Nofollow Usage over Time

The chart above shows how using rel=nofollow on internal links is slowly becoming less popular (though it's still a majority of use).

Rel=Canonical Use Over Time

This chart's telling us that rel canonical use has barely grown from June to October (as a percent). In this index, 5.42% of the pages we saw used rel=canonical tags. The datapoint from May (when rel=canonical was on 5.50% of pages we saw) is curious, but I suspect it has more to do with which pages we were choosing to crawl and index vs. an actual shift in usage. It's a good reminder, though, that unless we see large, sustained shifts across indices comprised of relatively similar URLs, we shouldn't jump to conclusions.

The next scheduled update for Linkscape is Nov. 12th (see the Linkscape Calendar page on our API Wiki) and we hope to be in much better shape with hitting that deadline.

Linkscape is also undergoing some serious upgrades over the next 3 months. With our web app launched (and regular upgrades on track), 4 of our 10 engineering folks (Phil, Chas, Bryce & Ben) are going to be working to make Linkscape fresher, faster, more comprehensive and higher quality by January. Expect to see some incremental improvements between now and then, which we'll report here on the blog.

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Daily Snapshot: GOP Rewarding Corporations that Create Jobs Overseas

Your Daily Snapshot for
Saturday, October 16, 2010

Your Weekly Address: GOP Rewarding Corporations that Create Jobs Overseas

The President lays out his agenda to foster investment here at home. He vows to close the tax loopholes for sending jobs and profits overseas that Congressional Republicans have tried to protect. Watch the video.

Weekly Wrap Up: Work That Needs to Be Done

A quick look at the week of October 11th, 2010:

Quote: "This is work that needs to be done. There are workers who are ready to do It." – President Obama on investing in our infrastructure. http://wh.gov/381

Your West Wing Week: “I Spy” Video: http://wh.gov/3Kw

Talk to Us: Don’t miss next week’s live chats: Talk about the economy with Austan Goolsbee http://wh.gov/30N, the arts with Chuck Close http://wh.gov/30N and cyber security awareness with Howard Schmidt http://wh.gov/38Y

It’s the Waiting for Superman Kids: Students from the documentary meet President Obama in the Oval Office and watch him take off in a helicopter from the South Lawn in this behind-the-scenes video: http://wh.gov/3Zo

A Colbert Bump: Austan Goolbee, Chair of the Council of Economic Advisers, talks tax cuts on the Colbert Report: http://bit.ly/cZpBjW (and the White House White Board video that inspired it all: http://wh.gov/38C)

You Asked, Chu Answered: Department of Energy Secretary Chu answers your questions on home energy efficiency: http://wh.gov/3Kr

Dam Good Tweet: RayLaHood: How 'bout that bridge? I mean, seriously, THAT is something. #hooverdam http://bit.ly/api9vP

Picture Show: Behind-the-scenes shots from September: http://wh.gov/38a

Notable Number: $2,500. Learn more about what the American Opportunity Tax Credit means for college students: http://wh.gov/30T

Bill Shock: The FCC takes on “bill shock,” and other practices that are giving consumers headaches with their Consumer Empowerment Agenda. http://bit.ly/aPObzV

Your VA: VA launches a national awareness campaign on benefits for Veterans, watch the video: http://bit.ly/aN9ou8 and check out the website: http://bit.ly/bZ16et

Think Pink: The White House goes pink in honor of Breast Cancer Awareness Month and Dr. Jill Biden discusses the battle that takes place every day http://wh.gov/30t

The White House seen from the North Lawn is bathed in pink light in honor of Breast Cancer Awareness Month Oct. 14, 2010. (Official White House Photo by Lawrence Jackson)

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Seth's Blog : N-1

[You're getting this note because you subscribed to Seth Godin's blog.]

N-1

Fred had an inspiring post about the ability to always add one more thing. His old roommate called it N+1. Just when you think there's no more, you find a little room.

Perhaps it's worth considering an alternative. N-1. There are tons of things on your to do list, in your portfolio, on your desk. They clamor for attention and so perhaps you compromise things to get them all done. What would happen if you did one fewer thing? What if leaving that off the agenda allowed you to do a world-class job on the rest? What if you repeated N-1 thinking until you found a breakthrough?