Mish's Global Economic Trend Analysis

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• Goodbye JS-Kit, Hello Echo: New Comment System on This Blog
• Obama's Definition of Halfway: 18%; What Would a Government Shutdown Mean?
• Big-Box Retailers Reconsider Size; Saturation, Online Sales Affect Store Expansion Plans and Hiring Needs

Goodbye JS-Kit, Hello Echo: New Comment System on This Blog Posted: 05 Mar 2011 08:53 PM PST At long last I am upgrading the comment system on my blog. I had been using JS-Kit for years in what is best described as a love-hate relationship. This change will take place shortly. The JS-Kit release I have been on is a couple years old. Time and technology have moved on. My choices were as follows: Write my own software Wither and Die Move to Disqus Migrate to Echo Number 1 is out. I do not have the time or interest in writing my own. I need a commercial product. Wither and die hardly seems like a good option. The choice came down to Disqus vs. Echo. If you search the internet you can find whatever you want to hear, good or bad, with some users frustrated with one or both of the products. However, Echo has a couple of significant advantages. First, Echo is a migration. JS-Kit developed Echo. Disqus, would be starting all over. Second, Echo has attracted quite a following including Sports Illustrated, Newsweek, Slate, the Washington Post, Time, and numerous other big-name companies. Here is a snapshot of some of the companies using Echo. Moreover, Echo has an open architecture. Enhancements and solutions can be developed by end users. That may take a while but it is an enormous advantage. Third, I tested and like the new interface. Echo supports sign-ins from the following. You can also sign-in with your blogger ID (on page 2). Those sign-ins will work regardless of what computer you are on. JS-Kit had issues moving from computer to another. What's New Echo will not pop up in a new window as before. Instead, when clicking on "comments" the window will expand inline. This is typical of most other blogger commenting systems but is new to my blog. It takes no more time to do this than pop up a new window. For new users, login or signup is the same. Just click on one of the options above to sign in. As before, the first comment from everyone requires moderation. In this case, everyone. I need some leeway in the time it takes to approve new users. However, I have better tools under Echo to see what comments await moderation. Hopefully the initial response will be faster than before. The difference is we are starting with a blank slate. Everyone will have to be approved. Here is the login window everyone will see. Once you are logged in, simply type your comments in the above box. Threaded vs. Unthreaded The debate still rages. Some people like threaded mode. Others don't. Threaded mode works beautifully when there are under 50 comments. When comments get beyond a few pages, it can become unwieldy. However, some people always like it. Others want to view comments sequentially by time stamp. It makes it easier to see what is new. Some like new comments displayed first other pure sequential. There is no right or wrong actually. There are only preferences. Unfortunately, and as is with most other commenting systems, those preferences are not usable selectable. For now, I have to make a selection. One of the moderators on my board has a strong preference for threaded mode. Threaded mode it is. Let's try that for a while and see how it works out. In the meantime, I ask Echo for a user selectable set of controls so everyone can display comments as they see fit. Migration of Comments The last couple weeks of comments will be available shortly. A conversion process is already underway for the rest of them. Perhaps I only go back a year or so. Beyond that, I don't see that much use. Those details will be up to the Echo team. Issues I am quite sure issues will arise just as they do with any new system. However, Echo is a big step in the right direction from JS-Kit. It has numerous capabilities I did not turn on initially including incorporating comments from Facebook, Twitter, and other social network sites. Thanks to Those Who Helped With that I want to thank Khris Loux, Andrew Kushnir, Chris Saad, and the rest of the Echo staff for their assistance in this conversion. Finally, one of the difficulties in this process is that nothing is easy in blogger templates. Here's to "MDH" who helped me in this effort. This migration would not have been possible without "MDH". Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

Obama's Definition of Halfway: 18%; What Would a Government Shutdown Mean? Posted: 05 Mar 2011 03:15 PM PST President Obama claims he is meeting Republicans "half-way" on Republican plans to reduce the deficit by $61 billion. "Half-way" is $11 billion ($10.5 billion to be more precise). My math strongly suggests the president needs math lessons. Please consider Obama offers deeper cuts, appeals for budget deal President Barack Obama says he's willing to make deeper spending cuts if Congress can compromise on a budget deal that would end the threat of a government shutdown. Obama's appeal for common ground came Saturday in his weekly radio and Internet address, but lacked specifics on how to bridge the $50 billion gulf that divides the White House and Democratic budget proposal from the deeper reductions offered by Republicans. The government is running on a temporary spending bill that expires March 18, so the parties have until then to come up with a plan to pay for the remainder of the budget year through September. "We need to come together, Democrats and Republicans, around a long-term budget that sacrifices wasteful spending without sacrificing the job-creating investments in our future," Obama said. "My administration has already put forward specific cuts that meet congressional Republicans halfway. And I'm prepared to do more," said Obama. But the claim that Democrats are meeting Republicans halfway only stands up under the Democratic explanation of the intricate numbers game being played on Capitol Hill. Obama has threatened to veto that plan, and a Democratic offer of $6.5 billion in cuts -- on top of $4 billion already signed into law -- restores money the House GOP cuts from education, health and other programs. "You may have heard President Obama say that we need to make sure 'we're living within our means,'" said freshman Rep. Diane Black, R-Tenn. "He's right about that. Unfortunately, his budget doesn't match his words. Tortured Math The way that article is worded, I am not even positive the Democrats have offered up even as as the $11 billion I gave them credit for. I am struggling with the fact that the Democratic proposal "restores money the House GOP cuts from education, health and other programs." What kind of tortured logic allows you to claim credit for cuts if you restore money elsewhere? Let's dive deeper into one of Obama's statements: "We need to come together, Democrats and Republicans, around a long-term budget that sacrifices wasteful spending without sacrificing the job-creating investments in our future" Since when is getting rid of wasteful spending "a sacrifice"? What Would a Government Shutdown Do? For all this concern about having a budget in place by March 18 (revised later from March 5 by some sort of emergency funding provision), does it really matter? CNN Money discusses the setup in Shutdown: What you need to know Which services would stop? During the last major shutdown, the government closed 368 National Park Service sites, along with national museums and monuments. In addition, 200,000 passport applications went unprocessed, and toxic waste cleanup work at 609 sites stopped. The National Institutes of Health stopped accepting new clinical research patients, and services for veterans, including health care, were curtailed. Work on bankruptcy cases could slow. In the last shutdown, more than 3,500 cases were delayed. Which services would the government keep running? Agencies are allowed to perform any operations necessary for the safety of human life and protection of property. The government would keep essential services -- like air traffic control and the national security apparatus -- in full operating mode. Federal workers who provide medical care on the job would be kept on, as well as employees who handle hazardous waste, inspect food, patrol the borders, protect federal property, guard inmates or work in power distribution. Workers who protect essential elements of the money and banking system would also report to work. The Postal Service, which is self-funded, will continue to operate. Preposterous Hype For all the hype over a shutdown, I fail to see how it would matter much. Republicans should stick to their guns. I assure you the world will not end. The world did not end in the Clinton administration during five days in November 1995 and another 21 days that ended January 1996. Indeed the best thing might be for everyone to see how little a "shutdown" would matter. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

Big-Box Retailers Reconsider Size; Saturation, Online Sales Affect Store Expansion Plans and Hiring Needs Posted: 04 Mar 2011 11:45 PM PST Online shopping not only has state departments of revenue pulling their hair out over lost sales tax revenue, it also has retailers like Best Buy, Sears, KMart, and Home Depot questioning, the merits of the big-box mentality itself. The Wall Street Journal reports As Big Boxes Shrink, They Also Rethink Major big-box retailers have been shifting to smaller stores—and scratching around for more profitable ways to fill under-used spaces as they go about reinventing themselves. Sears Holdings Corp. is letting prospective tenants browse an online list of Kmart and Sears stores with space to rent. Sears reached a deal to lease 34,000 square feet of store space in Greensboro, N.C., to Whole Foods Market Inc. for a grocery store set to open in 2012. Home Depot Inc. is selling off portions of its parking lots to fast-food chains and auto repair shops. Gap Inc. is reverting to a Russian nesting-doll strategy: after years of expanding by adding standalone stores such as GapKids and Gap Body, it is shrinking them and stacking them back inside its namesake Gap stores. Best Buy Co. last week became the latest retail chain to go smaller, announcing last week that it was slowing growth of new big-box stores this year in favor of adding 150 Best Buy Mobile locations, focused on smartphones. Wal-Mart Stores Inc. also said last week that it was accelerating the rollout of smaller locations—40,000 square feet or less—after it reported a seventh straight quarterly decline in sales at U.S. stores open at least a year. The retail giant, which rose to dominance with 185,000-foot Supercenters, plans to open its first Walmart Express store in the second quarter of this year, though it won't say where. The miniature Staples carries just 1,200 of the retailer's most high-volume sales items, compared to 8,000 items in traditional stores. Office Depot Inc., meanwhile, quietly began opening new shops the size of convenience stores in December. The new 5,000-square-foot Office Depot stores are barely a fifth the size of the company's traditional locations, yet still manage to contain the office supplies and copy and mail services that account for 93% of the bigger stores' sales, said Kevin Peters, Office Depot's North American retail president. "Our box was just too big and didn't work for our customers," Mr. Peters said Wednesday. "We are reinventing Office Depot as a convenience retailer. Think CVS and Walgreens." Key Word is Saturation The "bigger is better model" that collapsed with residential real estate, has expanded to its big brother, commercial real estate. The problem is not the size of the stores, but the sheer number of them. Areas that got by with a single Home Depot, now have 2 Home Depots, a Lowes, and a Menards. If they all shrink, does it do any of them any good? Store Advantages Those who need something and want it now Those who want to make comparisons and see a product in person Online Shopping Advantages It's invariably cheaper online There is frequently no sales tax You do not have to waste time and money traveling Online Sales Have States Furious Over Lost Sales Taxes Cash strapped states are furious with Amazon.Com over sales tax collections. Several states passed laws or have sent Amazon bills. Amazon's response in every case so far is to leave the state. For details, please see Amazon May Cut Ties to California Over Tax Issues; Texas Distribution Site Closed Over Similar Issues Last Month; Litigation Issues Move to Forefront Last week I went to Best Buy to buy a particular cable I needed. They did not have it. I ended up ordering it from Amazon. If stores shrink, and they do not have what customers want, customers will just buy more stuff online. Big-Box Decisions Affect Store Hiring Plans I am wondering, do we really need "Walmart Express" at all? At best it is a sign of total saturation of big boxes and a turf battle for smaller cities and neighborhoods. As such, think about store hiring plans now vs. store hiring plans in the midst of the big-box commercial real estate boom. With the new "smaller is better" model, another commercial real estate boom remotely close to the build-out that occurred in 2005-2007 is not in the cards. Moreover, residential housing is still dead. Together, the picture just does not add up to the 200,000+ jobs a month many economists and market cheerleaders expect. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

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