Central Perk: 23 dec. 2012

duminică, 23 decembrie 2012

Mish's Global Economic Trend Analysis

Yen Declines Following Shinzo Abe's Threat to Change Japanese Law; An Idle Threat?

Posted: 23 Dec 2012 06:46 PM PST

A very serious question that investors face today regards whether Japan is or isn't serious about politicians taking over Japan's central bank.

Personally, I think the politicians are serious, as well as "seriously wrong".

If you think that I am wrong, please consider Yen Declines After Abe Says He May Change BOJ Law.

The yen declined versus its peers after incoming Japanese prime minister Shinzo Abe said he will consider changing the law on the central bank unless it boosts its inflation target to 2 percent next month.

Abe said on Japan's Fuji Television yesterday that he will consider revising the law governing the Bank of Japan if it fails to increase its inflation target from 1 percent at its January meeting. He is poised to become prime minister after his Liberal Democratic Party's coalition secured a majority in elections on Dec. 16.

Abe has called on the BOJ to pursue "unlimited easing" to help end deflation and revive growth. BOJ Governor Masaaki Shirakawa and his board last week refrained from doubling the central bank's 1 percent inflation target, while expanding its asset-purchase program by 10 trillion yen ($118 billion) to 76 trillion yen.

Idle Threat?

I see no indication whatsoever this is an idle threat. The counter-argument in the form of a question is "what good did a 1% inflation target by the Bank of Japan do?"

The real question pertains not to the target but actual actions. After all, policy could be 20% instead of 2% but unless either the government or the central bank backs up the pronouncement with actions, talk is meaningless.

I happen to think Shinzo Abe is nuts enough on this go around, to do what he didn't do the first time he was prime minister.

Moreover, my general belief is that statements by politicians regarding what they will or will not do are likely to be most accurate at times their policies will do the most damage.

In this case, Shinzo Abe's threat, if carried out, would destroy Japan.

I take that threat very seriously.

You are free to disagree, but first consider ...

Bear in mind that nothing moves in a straight line. The Yen has declined significantly, and a snapback rally may (or may not), happen at any time. Longer term, I see no reason to change my forecast of a declining Yen.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Bank of Japan Holdings of Japanese Government Bonds Exceeds 100 Trillion Yen for First Time

Posted: 23 Dec 2012 07:45 AM PST

Bloomberg reports BOJ Holdings of JGBs Exceed 100 Trillion Yen for First Time

The Bank of Japan holdings of the government's bonds exceeded 100 trillion yen ($1.2 trillion) for the first time, raising the risk that yields will jump on perceptions that it is financing public spending.

The central bank held 104.9 trillion yen of the debt at the end of September, 11.1 percent of all government bonds, a quarterly central bank report showed today in Tokyo. The BOJ said it was the highest on record. Bond holdings by foreign investors rose to a record 9.1 percent.

The BOJ yesterday expanded its asset purchase program for the fifth time this year, with half of the 10 trillion-yen increase to be spent on JGBs. Incoming Prime Minister Shinzo Abe wants more central-bank action to defeat deflation and has pledged fiscal stimulus to stoke growth, even as he's constrained by the world's largest public debt.

If QE worked and fiscal stimulus worked, Japan would not have debt-to-GDP ratio of 230%. Japan's national debt now exceeds a quadrillion yen!

A quadrillion is a number with 15 zeros. 1,000,000,000,000,000. Can that ever be paid back? How?

US has been running budget deficits exceeding $1 trillion for four straight years. What the heck is that other than Keynesian stimulus?

It has failed. But economists like Paul Krugman want more of it (please see Mish on Capital Account: "Time for Krugman to Leave Ivory Tower for Real World").

Krugman will claim deficit spending prevented disaster. It did no such thing. All it did is pile up the debt that cannot possibly be paid back.

The average 7th grader likely understands that he cannot spend more money than he has for years on end. The average economist does not.

For more on Japan, please consider Kyle Bass on the End of the Debt Supercycle and a Coming Massive Devaluation of the Yen; Most Difficult Time to Invest; The Belief Bubble

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Seth's Blog : How to make a website: a tactical guide for marketers

How to make a website: a tactical guide for marketers

This isn't about the strategy of how to design a website that works--this is my take on how marketers can work with their teams, their bosses and their developers to get the site they want built with less time and less hassle. (PS all of this works for apps, too). Most people who are responsible for websites are amateurs. This is my best take on how the goal-oriented non-professional can do a good job.

Three things worth remembering:

Every website is a marketing effort. Sooner or later, your site involves an interaction with a user, and that interaction won't be 100% technical. You have to sell the engagement, the interaction and the story you have in mind. While websites have always involved technology, the tech is secondary to your ability to get your point across.
Virtually all websites are not on the cutting edge of technology. You're doing something that's been done before, at least technically.
Synchronizing your team is difficult, because most people know it when they see it, and seeing it is expensive. It's sort of like building a hundred houses in order to find the one that your spouse likes--not a practical effort.

The approach I recommend:

Find the tech elements you need by browsing the web. Make a list--I want menus that work like this site, a shopping cart that works like that site, a home page that works like this one.
Create the entire site (or at least the critical elements) using Keynote on the Mac (PowerPoint works too, but Keynote is a little easier to work with). Begin by copying and pasting elements from other sites, but as you make progress, hire a graphic designer to create the elements you need. Keynote makes it easy to actually have spots on the screen link to other slides in the 'presentation', so the document you create will actually allow your team to click on various parts of the screen and jump to other pages.
Do not do any coding at all.

What you end up with, then, is a 3 or 10 or 100 page Keynote document, with a look and a feel. With menus. With fonts. With things in their proper hierarchy. Once you're good at this, you can build or tweak a 'site' in no time.

Now you have a powerful tool. You can use it in presentations, in meetings and even test it with users, all before you do any coding at all. Once you've shared this with the team, the question is simple, "if our website works just like this, do you approve of it?" Don't start coding until the answer is yes.

This is a discipline, one that takes a fair amount of guts to stick with, but it pays off huge dividends. Don't code until you know what you want.

Last step: Hand the Keynote doc to your developers and go away until it's finished.

As I said, this works for mobile apps too. Here's a site filled with template shortcuts for both.