Central Perk: 19 iul. 2012

joi, 19 iulie 2012

Mish's Global Economic Trend Analysis

Tech Sector Layoffs Surge to Three-Year High
Job Losses and Unemployment Skyrocketing in China; Thinner, Taller iPhone 5
U.S. Treasuries a Buy or a Short?

Tech Sector Layoffs Surge to Three-Year High

Posted: 19 Jul 2012 04:59 PM PDT

I am starting to think the next jobs report is going to be downright miserable. New orders have plunged and mass layoffs are on the rise.

Please consider Tech sector layoffs surge to three-year high

During the first half of the year, 51,529 planned job cuts were announced across the tech sector, representing a 260 percent increase over the 14,308 layoffs planned during the first half of 2011. Things are so bad so far this year that the figure is 39 percent higher than all the job cuts recorded in the tech sector last year.

Hewlett-Packard proved to be the major force behind this year's uptick in planned layoffs, after the company announced in May that it would cut 30,000 jobs. Those layoffs will be completed by the end of fiscal 2014, and shave off 8 percent of HP's entire workforce.

It was also a tough beginning of the year for Sony and Nokia, both of which said they would lay off 10,000 employees. Panasonic and Olympus are also eyeing layoffs to make their operations more nimble.

The issue in the tech sector, according to the outplacement firm, is that success is increasingly finding its way to a short list of companies. All others are hoping they can stay afloat or revive their operations around new ideas. And all of that could lead to more cuts across the industry in the coming months.

"We may see more job cuts from the computer sector in the months ahead," John A. Challenger, CEO of Challenger, Gray & Christmas, said today in a statement. "While consumers and businesses are spending more on technology, the spending appears to favor a handful of companies. Those that are struggling to keep up with the rapidly changing trends and consumer tastes are shuffling workers to new projects or laying them off altogether."

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

Job Losses and Unemployment Skyrocketing in China; Thinner, Taller iPhone 5

Posted: 19 Jul 2012 11:39 AM PDT

In the video below Jefferies Managing Director Peter Misek discusses the coming iPhone 5 with Emily Chang on Bloomberg TV.

Misek reports the iPhone will be significantly thinner and taller because of new technology he did not expect to be available for at least another year.

What really caught my eye, however, was a segment in the middle of the video regarding grim statistics on sales and employment in China starting at about the 2:26 mark.

Link if video does not play: Details on iPhone 5 Emerge

Partial Transcript

Emily Chang: Another thing you say is smart-phone and PC demand in China is dropping off significantly. What exactly is going on there?

Peter Misek: We came back from China really depressed, I have to say. It appears that mainland China is correcting significantly. The statistics the government publishes, frankly we think are largely fabricated. So you have to rely on other statistics such as retail sales, electricity usage, mall traffic, etc. And what we saw, and what we heard was pretty grim. We think consumer electronic sales could be falling double-digits year-over-year in June and thus far in July. And we think the catalyst frankly is job losses. The premier of China was on this morning basically saying the labor situation is severe, meaning job losses are accelerating and unemployment is skyrocketing. That is causing the Chinese consumer who naturally saves more than we do, to save even more.

Plunging New Orders Everywhere

The rise in Chinese unemployment ties in perfectly with my July 6 report Plunging New Orders Suggest Global Recession Has Arrived.

The grim data also fits in with the email yesterday from Michael Pettis yesterday: "China Rebalancing Has Begun"; What are the Global Implications?

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

U.S. Treasuries a Buy or a Short?

Posted: 19 Jul 2012 01:27 AM PDT

I had a nice conversation the other day with Lacy Hunt at Hoisington Investments. We agree on many aspects of the global economy and I have a few excerpts of Hoisington's latest forecast below.

First, let me state that if you are looking for someone who has called the US treasury market correct this past decade, look no further than Hunt.

While I have been US treasury bullish (on-and-off ) for years (more on than off), and I can also claim to have never advocated shorting them (in contrast to inflationistas running rampant nearly everywhere), Lacy has correctly been a steadfast unwavering treasury bull throughout.

Will Hoisington catch the turn?

That I cannot answer. However, one look at Japan suggests the actual turn may be a lot further away than people think.

For a viewpoint remarkably different than you will find anywhere else, please consider a few snips from the Hoisington Quarterly Review and Outlook, for the Second Quarter 2012 (not yet publicly posted but may be at any time).

Abysmal Times Confirm the Research

In the eleven quarters of this expansion, the growth of real per capita GDP was the lowest for all of the comparable post-WWII business cycle expansions. Real per capita disposable personal income has risen by a scant 0.1% annual rate, remarkably weak when compared with the 2.9% post-war average.

It is often said that economic conditions would have been much worse if the government had not run massive budget deficits and the Fed had not implemented extraordinary policies.

This whole premise is wrong.

In all likelihood the governmental measures made conditions worse, and the poor results reflect the counterproductive nature of fiscal and monetary policies. None of these numerous actions produced anything more than transitory improvement in economic conditions, followed by a quick retreat to a faltering pattern while leaving the economy saddled with even greater indebtedness. The diminutive gain in this expansion is clearly consistent with the view that government actions have hurt, rather than helped, economic performance.

Economic conditions have been worse in euro-currency zone countries, the UK, and Japan. All three of these major economies have also resorted to massive deficit financing and highly unprecedented monetary policies, and all have substantially higher debt to GDP levels than the United States.

The UK and much of continental Europe is experiencing recession to some degree. Whether Japan is in or out of recession is a pedantic point since the level of nominal GDP is unchanged since 1991. Even such prior stalwarts of the global scene such as China, India, Russia and Brazil are plagued with deteriorating growth. In such circumstances a return to the normal business cycle of one to two rough years, followed by four to five good years, remains highly unlikely in the United States or in these other major economic centers.

Based upon the historical record of effects of excessive and low quality indebtedness, along with the academic research, the 30-year Treasury bond, with a recent yield of less than 3%, still holds value for patient long-term investors. Even when this bond drops to a 2% yield, it may still have value in relation to other assets.

If high indebtedness is indeed the main determinant of future economic growth and further government "stimulus" is counterproductive, then a prolonged state of debt induced coma may so limit returns on other riskier assets that a 30-year Treasury bond with a 2% yield would be a highly desirable asset to hold.

Those were the ending paragraph of Hoisington's four-page 2nd quarter review. I added paragraph breaks for ease in reading.

Are US Treasuries "Undervalued"?

I will respond to my own question with another question: Undervalued compared to what?

Certainly I would not advocate blindly buying 30-year year US treasuries with the intention of holding on to them for 30 years. Nor would Lacy Hunt.

Likewise, I see no real value in holding 10-year US treasuries for the next 10-years either.

Then again, I have stated the US may go in and out of deflation for as long as a decade. If that does happen, treasuries may easily outperform for that entire period.

One look at the Japanese stock market shows what might happen.

Three Lost Decades

click on chart for sharper image

I do not believe that is the path for US equities. However, I may very well be wrong. It is always important to consider what happens if you are wrong. Few bother to do just that.

If I am wrong (and that is certainly a decent chance), then what does that say about the potential for US treasuries?

Rather than advocating buying or shorting treasuries here, I am advising people to do something different:

Think!

Please consider all aspects of a trade, and in this case, what might easily happen to the widely espoused notion "US Treasuries are a Short". Also think about who is on the other side of the trade and why.

Short-term, US treasuries are overbought. Otherwise, they are hugely unloved.

People have been saying Japanese treasuries are a short for at least two decades. They will eventually be correct, and in my opinion much sooner than US treasury shorts (ignoring short-term US volatility).

Think about this: Bull markets do not end with the asset class being universally despised except by dedicated funds and foreign governments (the latter primarily for balance-of-trade purposes only).

Rather, bull markets end with nearly everyone becoming a believer.

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

Facebook Promoted Posts vs Sponsored Stories

Posted: 18 Jul 2012 08:03 PM PDT

Posted by Justin_Vanning

There's been a lot of buzz around Facebook's Promoted Post feature over the past few months. I've read several blog posts (the HasOffers post was great) who have tried testing the effectiveness of Promoted Posts vs Facebook's Sponsored Story ads, and thought it would be interesting to do a similar test here at SEOmoz. Before I jump in to the results of my test, I'll give a quick overview on Promoted Posts for those who aren't familiar.

What's the Difference Between a Promoted Post and a Sponsored Story?

Facebook rolled out their Promoted Post feature at the end of May, allowing Brand Page owners to pay to push content to a broader audience than normal. What some people don't know is that when you publish content on your Facebook Brand Page, only a small percentage of your fans are seeing that content appear in their news feeds.

Facebook uses its complex EdgeRank algorithm to determine which content each user sees in their news feed. Facebook estimates that only 16% of a company's fans will see every post they generate in their news feed. Some companies will obviously have a much higher percentage of engaged fans than others, but it shows that simply publishing content on your Brand Page won't get it seen by 100% of your audience.

So, this is where Promoted Posts come in handy. You now can dedicate up to $100 to "promote" a recent post on your Facebook Brand Page. Facebook says, "Your promoted posts will be seen by a larger percentage of the people who like your page than would normally see it. It will also be seen by a larger percentage of the friends of people who interact with your post." What this means is that Facebook will distribute your content to a much broader segment of your fan base instead of just the fans who are already engaged with your brand. Sounds interesting, right?

Now, let's quickly discuss another tool for distributing your content on Facebook to a broad audience. Facebook's Sponsored Story is created within the Facebook Ad Platform and functions just like a Facebook Ad. You can set this up the same way as you set up Facebook Ads and select your targeting from the large list of available targeting and interest category options that Facebook provides. You'll create an ad image, write your ad copy, link to your content, assign a budget, set your bid, and then activate it. The main difference is that Sponsored Stories look like Facebook ads so they only appear in the right side of the Facebook Page where all the other ads are, and they will mainly target people who aren't fans of your Brand Page.

The Test: Promoted Post vs Sponsored Story

Show me the results, baby! We decided to use a recent update to our Beginner's Guide to SEO as the content piece that we would Promote and run in our Sponsored Story. For the Promoted Post, we created a simple post on our Brand Page linking to the Beginner's Guide and dedicated $100 to it. This Post had a reach of 26,275. It generated 198 actions, 1,311 clicks and had a CTR of 4.99%. The CPC was $.076.

For the Sponsored Story, we targeted 266,580 people who live in the US, Canada, UK, or Australia and like SEO related topics and websites. The actual reach of the campaign was 44,247 with a frequency of 6.2. This Sponsored Story generated 16 actions, 162 clicks, had a CTR of 0.366% and a CPC of $1.44.

As you can see from our test results, the Promoted Post generated far more engagement than the Sponsored Story, had a higher CTR, and had a significantly lower CPC!

	Campaign Reach	Actions	Clicks	CTR	Spend	CPC
Promoted Post	26,275	198	1,311	4.990%	$100.00	$0.076
Sponsored Story	44,247	16	162	0.366%	$233.47	$1.441

The only area that the Sponsored Story out-performed the Promoted Post was in campaign reach. This makes sense since we were targeting a large group of SEO professionals and enthusiasts through Facebook Ads' interest targeting. At the end of the day, our Promoted Post to our fans who had not engaged with us in a significant amount of time generated a huge amount of interest in our content and drove a majority of the actions and clicks on our post.

To conclude, the combination of a Promoted Post and a Sponsored Story helped us to achieve metrics on our post that we have never seen before on our Brand Page.

This was our most viewed post ever (more than 5x's the previous record and was also the most liked and most shared)! While this didn't necessarily generate revenue for us, it was great to see how the Promoted Post and Sponsored Story can work together to achieve massive reach and engagement. The next step will be to see how the Promoted Post and Sponsored Story tools perform when driving a promotional offer or direct CTA type of content.

In the end, the main thing this test taught us was that it's important for every advertiser and brand to test things on their own. Just because one company sees a certain set of results doesn't mean that your company will see the same. Every brand, fan base, target audience, and customer base is different and will react differently so what it boils down to in my opinion is test, test, and test again.

I hope this analysis was helpful, and I'd love to hear from any of you who've run similar tests or messed around with the Promoted Post and Sponsored Story to see what types of results you've experienced.

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!

Photo: A Paw Up on Things

Your Daily Snapshot for
Thursday, July 19, 2012

Photo: A Paw Up on Things

White House photographers are hard at work every day capturing some incredible moments for history, and every month we release a photo gallery that takes you behind the scenes, giving you an inside look at the President and what keeps him busy.

Check out our June gallery, including photos of the G20 Summit, the President welcoming the New York Giants to the White House, and some great photos of Bo, the First Dog.

Check out our behind-the-scenes gallery from June:

Brian Mosteller, Director of Oval Office Operations, sits with Bo, the Obama family dog, in the Outer Oval Office, June 20, 2012. (Official White House Photo by Pete Souza)

Seth's Blog : The importance of going first

The importance of going first

The second person to write a story about a young boy and an escaped slave on the Mississippi wasn't a novelist, he was a typist.

"Just like that hot viral video but different/better/more clever," is extremely different from "that hot viral video."

In more and more fields, the originator of the novel idea reaps an outsize share of the benefits. One reason is that it's easier to gain attention quickly. Another is that once you gain attention and reputation, it's easier to lock in permission and turn it into a foundation for your next project. And most of all, when attention is precious, earning that attention with innovation is priceless.

Yes, there are exceptions for those that bring service or price or reliability along to polish an existing idea. And there are certainly businesses that profit from taking over after the innovator, exhausted, gives up and moves on.

But given the choice, I'd say first is a better use of your talent.