joi, 5 aprilie 2012

Mish's Global Economic Trend Analysis

Massachusetts Health Care System: A Model for Failure
Another Bad Day for Spanish Bonds, 10-Yr Yield Hits 5.85%, Settles at 5.75%
Crunch Time for Greece (Case for Bank Holiday and Eurozone Exit Now): Disbursements to Greece by the EFSF and IMF "Conditional on Compliance with Conditionality"

Massachusetts Health Care System: A Model for Failure

Posted: 05 Apr 2012 01:56 PM PDT

Here is an interesting email from reader "George" on his experiences with Romneycare.

Hello Mish

Here is my personal experience with socialized medical care in Massachusetts.

I've spent the last three years traveling the globe. Prior, I worked at State Street. I was working on an overly complex billion dollar swap fund which contained every paper asset known to mankind. Thus, it lost money. I hated the office, the office politics, and the sheer stupidity of mega corporate America.

I quit and decided to travel the globe for three years or until I found something I was passionate about. It was also a period for self-actualization, and personal growth.

I would have no income for the foreseeable future. I had 70K saved up. As a Massachusetts resident I am required to be insured meeting criteria X,Y and Z, or you face tax penalties.

However, I didn't need, or want the one size fits all insurance schemes in Massachusetts. I needed a high deductible, low premium "disaster," plan in case I had cancer or other life altering sicknesses.

I wanted to couple that with my travel insurance plan (Medex Assist). For minor things, broken legs, swimmer's ear etc, my travel insurance would cover it all.

Health care, in other parts of the world is much, much cheaper. You can pay cash for everything and it doesn't affect your bottom line. For example, a brain MRI at a luxurious five star hospital in Bangkok (think Hilton or Ritz Carleton) is only $50.00. Moreover, many of the doctors are trained in the West. To top it off, Eastern medical schools are catching up very quickly.

My lifestyle was not very synergistic with the one size fits all mandated health insurance schemes in Massachusetts. The light bulb went off and I considered purchasing the coverage in Florida where I could buy coverage tailored to my specific needs.

However, under Massachusetts law, I wasn't allowed to purchase health care across state borders, as I was a MA resident. However, I can purchase plans covering me in other places, Thailand, Costa Rica, the Bahamas, even Cuba.

I've used private health care clinics in Laos, Thailand, Indonesia, Costa Rica, South Africa, and The Bahamas and Texas. I return to Boston periodically to see family and friends, change my travel gear, supply up, passport pages etc. When I come back I often get a general checkup.

The health care in Massachusetts is so distanced from reality it's awe inspiring. There is no such thing as a cash price, or cash discount. The prices and services rendered have almost no correlation.

The "socialized" system in MA is now extremely overloaded. Doctors are overloaded with the "free" patients. They have no time to relax, listen or learn. It's a slow but fundamental degradation in doctor-patient time, and quality. This leads to an increase in misdiagnosed patients, maligned regulation and never ending state and federal imposition towards your personal health care, via policy, regulation and mandates.

Ironically it's all named in the effort to better care and reduce costs. It's absolutely amazing, that the worse things become, the more irrational the solutions, and arguments become.

The millionaires of the world no longer travel to America for care. They go elsewhere. Where don't they go? Socialized systems like Denmark, Canada etc. They go where service, value, and quality are held highly. Where markets are free of onerous regulation.

Traveling the world has broadened my perspective immensely, to the point where I, unfortunately, may not call American soil my home anymore. The barriers to entry from a bureaucratic standpoint are endless for small budding entrepreneurs. I'd much rather setup shop here in the Bahamas, not that, that in itself isn't loaded with it's own set of problems.

There are simple and effective solutions to bringing costs down. Ideas like allowing consumers to purchase insurance across state lines. Allowing foreign competition into the drug market increases domestic efficiency and lowers cost. There's a long list of rational and logical ways to fix the market. Let it be. Health care is not a unique market.

However, as usual, Washington, lobbyists, and the powers that be don't want real structural change that will improve long term conditions. Thus the US system will remain a complete failure across the board.

George
1st Row in front of the Conch Shack
The Bahamas

One thing for sure is our current system does not work, Obamacare does not work, and Romneycare does not work. Of course Obamacare and Romenycare are the same thing.

Please see Obama Delivers Warning to Supreme Court on Healthcare; If Obamacare Goes Down Who Is To Blame? Who Loses If Not Struck Down? Mathematically Speaking, Obamacare Cannot Survive for further discussion.

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

Another Bad Day for Spanish Bonds, 10-Yr Yield Hits 5.85%, Settles at 5.75%

Posted: 05 Apr 2012 09:50 AM PDT

Spanish government bonds are taking another dive today with yields rising again.

Chart from Bloomberg.

Place your bets on when yields soar above 6%. I suggest it will not be long.

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

Crunch Time for Greece (Case for Bank Holiday and Eurozone Exit Now): Disbursements to Greece by the EFSF and IMF "Conditional on Compliance with Conditionality"

Posted: 05 Apr 2012 12:12 AM PDT

If the second half of the title to this post seems silly, it is because it is silly. However, "disbursements to Greece by the EFSF and the IMF will still be conditional on compliance with conditionality" is an exact quote from The Second Economic Adjustment Programme for Greece, March 2012 by the European Commission.

I advise not attempting to read the document. It is a mere 195 PDF pages long. However, a tip of the hat to reader Brett who did manage to slog through the entire document to discover that gem on PDF page 55.

Brett also discovered some rather interesting facts regarding Greece's inability to make needed bond rollovers.

Brett writes ...

Hello Mish

I have spared you having to read the attached 195 page sleeping pill and I have discovered a major problem.

The first disbursement to Greece was on March 20. Disbursements are paid quarterly and no sooner, which effectively means that June 20 is the earliest next disbursement due date. Greece was originally supposed to receive 74 billion in the first tranche,(Page 56 on the document), it received 7.5 billion. Someone needed to put the decimal point one place to the right.

We know Greece is insolvent and it raided University accounts held at the Bank of Greece to effect the March bond swap. We know the bond swap offer (450 million Euro) for issue XS0147393861 was rejected and is payable on May 15 (6 Weeks to go). Somehow it has to pay this before the next tranche.

Of the 7.4 billion it received in the first tranche a Greek government official stated that "Greece would use this money to pay 4.66 billion euros to the European Central Bank and other eurozone national central banks for the capital amount of a three-year bond that expired yesterday".

This leaves 2.74 billion over 3 months to survive with. Even if you believe the 1% deficit for 2012 forecast (complete nonsense on page 99) Greece is in arrears 1.25 billion per month. This consumes entirely the remaining distributed money from the EU & IMF. Plus there is 5.2 billion Euros of Treasury bills due in April and May.

Greece 26-Week T-Bills

Greece 13-Week T-Bills

Below is my favorite line from the document.

However, the disbursements to Greece by the EFSF and the IMF will still be conditional on compliance with conditionality.

Why even bother?

Regards
Brett

March Bond Swap

Greece did manage to make the March bond swap but only by raiding University accounts held at the Bank of Greece. I was aware of this but have not commented on it yet. Now is as good a time as any.

The Slog covered this on March 26 in EXCLUSIVE: GREEK GOVERNMENT ROBBED PUBLIC INSTITUTIONS TO COMPLETE BOND SWAP

The illegally denied default of Greece entered a dramatic new phase this afternoon with the revelation by mainstream Greek public health website Health News that, shortly before midnight on March 8th – the eve of Greece's psi completion on Friday March 9th – on average 70% of public utility funds in various large, interest-bearing accounts at the Bank of Greece were raided. These included most of the State's regional hospital budgets, various universities and (it is alleged) at least one utility company.

The shortfalls came to light late last week and this morning as various hospital purchasing cheques in particular began to bounce. The monies – estimated by one source to total some 1.4 billion euros – appear to have been used to pay off the tiny minority of private sovereign creditors who, under the original terms of their bond purchase, were entitled come what may to full payment of the bond's yield entitlement.

Setting aside the amoral audacity of this act, it does yet again raise the issue of a Greece so utterly lacking in any real funds in the real world, that to pay off a minute proportion of the bondholders it had to resort to such a desperate measure.

On March 28, The Slog wrote GREEK EMBEZZLEMENT UPDATE: SLOGPOST VINDICATED BY ATHENS NEWS REPORT.

From Athens News:

'Six of the country's universities say they face immediate closure after the recent bondswap reduced their assets to zero. An emergency meeting of university rectors on Tuesday heard that only 33m euros remained of 120m euros that 17 Greek universities had deposited with the Bank of Greece for their operating expenses, while six university accounts were now completely empty meaning they would soon be unable to stay open.'

What Assets Can Greece Raid Now?

I thought there was a strong chance Greece would declare a bank holiday in March. It did not happen. Easter, this weekend, is also a reasonable bet, but I will not go far as to say it is a likelihood.

Regardless, somehow Greece needs to come up with money for April 20 and May 12 redemptions.

Is there another rabbit in the hat? I really do not know, but I do know that hats cannot hold an infinite supply of rabbits. I also know that the last trade date on Greek 1-year bonds was at 1,143% way back on March 9.

That should not inspire confidence in Greece or in rabbits.

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

Damn Cool Pics

Take The Stairs

Posted: 05 Apr 2012 04:46 PM PDT

Taking the stairs is something we know we should do but what a great little idea for that extra bit of motivation!

Via: Woostercollective

The Technology Behind Armored Vehicles [infographic]

Posted: 05 Apr 2012 11:32 AM PDT

If you see an armored vehicle rolling around your neighborhood, there is a good chance it's carrying a VIP. These vehicles are used to protect against assassinations and terrorist attacks. For example, the presidents Cadillac can withstand a direct attack from automatic weapons and still continue down the road. Every wonder how this is possible? Then check out the infographic from 21st.com below.

Click on Image to Enlarge.

Via: drivesteady

What's Better - On-page SEO or Link-building?

Posted: 04 Apr 2012 11:40 AM PDT

Posted by Dr. Pete

Hammering screws Every week, without fail, I hear someone ask where they should put their SEO budget – in on-page tactics or in link-building. Unfortunately, there are plenty of SEO companies and consultants lining up to give them the answer – and that answer just happens (“coincidentally”) to be whatever the company/consultant is good at. When you’re an expert with a hammer, you start to think you can nail anyone (wait, that’s not right).

Here’s the honest answer that no one wants to hear: “It depends”. No one wants to hear it because they’re back where they started – having no idea what to do next. Instead of leaving you stranded or trying to sell you a hammer for your box of screws, I’m going to walk you through 4 cases and explain how I’d allocate your budgets for each one.

What Is On-page SEO?

To add to the confusion, “on-page” can mean a lot of things to a lot of people. Here, I’m taking a very broad view – it could mean keyword research, writing good TITLE tags, internal linking and crawl architecture, or even content creation. For the purposes of this post, on-page is anything you directly control in the code or content of your site.

Case #1: The Authority

70% On-page, 30% Link-building

The Authority is an established site with a solid, trusted link profile and usually a good base of content. In many cases, it’s a site that’s evolved “organically”, which is a fancy word for “without a plan”. The Authority could be suffering from any or all of the following:

Keyword research is 5 years out of date
Keywords are cannibalized across many pages
Internal links have grown like weeds
Site architecture doesn’t reflect business goals
Page TITLEs overlap or are duplicated
Old but valuable (i.e. linked-to) content is 404’ing

In many cases, no one notices, because The Authority’s strong link profile and solid content keep it ranking well. The problem is that you’re sitting on a gold mine of untapped potential. Of course, The Authority should keep building solid links, but a shift (even for a few months) to really planning and focusing on on-page issues, from keyword research on up, could produce huge dividends.

Case #2: The Perfectionist

30% On-page, 70% Link-building

The Perfectionist often comes out in new webmasters. They’ve read 500 SEO blogs and are following all the “rules” as best they can, but they’ve become so obsessed with building the “perfect” site that they’ve hit the point of rapidly diminishing returns. The Perfectionist wants to know how to squeeze 0.01% more SEO value out of an already good URL by moving one keyword.

It’s time for The Perfectionist to remember the 80/20 rule – there comes a point where your on-page is good enough, at least for now. You have to get Google to your site to put that on-page magic to work, and that means building links. It’s important to develop content (which is why I’ve left on-page at 30%), but put almost every other on-page tactic to the side temporarily and spend a solid 6 months developing and implementing a link-building campaign

Case #3: The Hot Mess

90% On-page, 10% Link-building

The Hot Mess is a Google engineer’s fantasy (or possibly nightmare). She’s broken every single rule of on-page SEO, which worked fine for a while, but then came “May Day” and “Panda”, and now Google is even talking about penalizing her for optimizing too much. The Hot Mess has let something spin out of control, including:

Blocked crawl paths and bad redirects
Massive URL-based duplication
Excessive internal search, categories, and tags
Aggressive ad-to-content ratio
Extremely “thin” content
Nonsensical site architecture and internal linking
Keyword stuffing that would embarrass 1998

In some cases, this could be “over-optimization” and an attempt to manipulate the search engines, but in other cases the Hot Mess is just that – a mess. Whatever the cause, put down everything and start fixing the problems now. Chasing new links without fixing the mess is like having your carpets cleaned while your house is burning down.

Case #4: The Bad Boy

10% On-page, 90% Link-building

Finally, there’s the Bad Boy – he’s broken every rule in the Google link-building playbook, and they’ve finally noticed. This could be a large-scale devaluation or a Capital-P Penalty, including:

Paid links
Link farms, networks and exchanges
Excessive low-value links
Aggressive anchor-text targeting

If you’ve been bad enough, you could be talking a serious ranking penalty or even de-indexation. At that point, all the on-page tweaks in the world won’t help you (I left 10% just to keep the site up and running). You have to fix the problem and address the problem links. Bare minimum, you have to stop doing what got you into trouble and show a pattern of positive link-building. You may even have to file for reconsideration. The fix can be tricky, and depends a lot on the situation, but until you fix it, the Bad Boy isn’t going anywhere.

But What About Social?

Before I get a ton of comments, I purposely left social factors out of this post. I think the influence of social is growing and it definitely deserve your attention (and budget), but I don’t want to confuse an already complicated issue. Also, at this point, there are no major social “penalties” (small-p or Capital-P), so it’s hard to have an SEO crisis related to social – with the exception of an ORM problem. Still, social should certainly be a part of any healthy mix in 2012.

Is There a Perfect Mix?

I'm adding this after the fact - a few people asked me in the comments about the 50/50 scenario. Of course, the four scenarios in the post are just examples – based on common problems I've seen – and there are many other valid permutations. I specifically avoided the 50/50 mix for one reason, though - it implies that there's one "perfect" mix that you can sustain throughout the life-cycle of a website. The optimal mix is dynamic, and you should never leave it on automatic pilot.

When you first build a new site, you're going to need to invest in your site structure, keyword research, and on-page aspects. That mix may be 100% or 90% on-page for a couple of months. When that structure's in place and you launch, you'll still need to build content, but you'll also want to get your link-building in gear. For a site that's naturally based on new content (like a blog or news site), on-page may still be 70-80% of the mix (since I'm counting content as "on-page"). For a directory or resource site that has a critical mass of content, you may go 30% on-page, building out the long-tail and 70% link-building for a while. The mix will always be changing, as your site evolves and your business needs change.

One Size Never Fits All

I'll try to keep the point short and sweet - when it comes to the right mix, there is no one-sized-fits-all solution. On-page SEO and link-building are both important, but how important each one is really depends on your current strengths and weaknesses. Long-term, everyone should pursue a mix of solid on-page structure, unique content, an authoritative link profile, and substantive social presence. Diversity is the best way to future-proof your SEO - if the algo changes or you hit a snag on one pillar, at least there will still be enough left standing to keep your roof up.

Sign up for The Moz Top 10, a semimonthly mailer updating you on the top ten hottest pieces of SEO news, tips, and rad links uncovered by the Moz team. Think of it as your exclusive digest of stuff you don't have time to hunt down but want to read!

Startup Marketing: How to Earn Customers Without Paying for Them

Posted: 04 Apr 2012 03:17 AM PDT

Posted by randfish

Last week, on the very kind invitation of Dmitri Grabov, I gave a presentation in London to the Hacker News monthly meetup group. The event was sponsored and hosted by some friends at Forward, and attended by startup folks from all around the greater London area. Like my presentation in Silicon Valley, the focus was on marketing for startups.

Dmitri & Forward worked together to get the event filmed and posted the video online and thus, I felt it would be great to share here. A couple caveats before watching:

There's not a lot of advanced, tactically focused content. This talk is geared to startup marketers and founders and probably better for mid-level managers and consulting clients than for "in-the-trenches" SEOs and marketers (who already know all this stuff).
If you've already seen my presentation from the Silicon Valley HN meetup, this has quite a bit of overlap (go to ~30minutes in to see the unique material).
I'm sharing this version, despite the crossover with some previous work (something I usually don't do) because I think this may be the best iteration of this particular subject I've done to date, and one of the more efficient (the formal presentation is just under 45 minutes).
Warning - I do use a bit of bad language. Sorry about that! Sometimes I get excited on stage. :-)

My goal is to help more folks in the startup world become familiar with the practices of inbound marketing - content, SEO, social media, blogs, etc. These are powerful channels, but they often don't get the respect they deserve in these spheres (which both frustrates and surprises me).

Rand Fishkin - Inbound Marketing for Startups: How to Earn Customers Without Paying from HN London on Vimeo.

Hopefully, if you find the video enjoyable and useful, you can spread it to those who need a push to invest in or believe in the great practices inbound marketers undertake.

p.s. I've been on the road for the last two weeks, speaking at events in Madrid, Munich, London, Boston and now San Francisco, but return to Seattle Friday and will hopefully be better about consistent posting and whiteboard Friday appearances thereafter.

$0 in Federal Income Tax

Your Daily Snapshot for
Thursday, April 5, 2012

$0 in Federal Income Tax

In 2009, 1,470 millionaires paid $0 in federal income tax. Meanwhile, millions of middle class families paid their fair share in taxes—funding things like education, our military, and health care for seniors.

That's why President Obama proposed the Buffett Rule, so that no household making more than $1 million each year pays a smaller share of their income in taxes than a middle class family pays.

Find out more about the Buffett Rule:

Seth's Blog : Organized bravery

Organized bravery

The purpose of the modern organization is to make it easy and natural and expected for people to take risks. To lean out of the boat. To be human.

Alas, most organizations do the opposite. They institutionalize organized cowardice. They give their people cover, a place to hide, a chance to say, "that's not my job."

Our organizations are filled with people not only eager to dehumanize those that they serve, but apparently, instructed to do so. In the name of shareholder value or team play or not rocking the boat...

During times of change, the only organizations that thrive are those that are eager to interact and change as well. And that only happens when individuals take brave steps forward.

Giving your team cover for their cowardice is foolish. Give them a platform for bravery instead.