An In-depth Analysis of Authorship, Google+ and Snippets

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An In-depth Analysis of Authorship, Google+ and Snippets Posted: 10 Jul 2012 03:15 PM PDT Posted by Andrea Pernici This post was originally in YouMoz, and was promoted to the main blog because it provides great value and interest to our community. The author's views are entirely his or her own and may not reflect the views of SEOmoz, Inc. Read...but learn by doing! I am currently receiving more inquiries than ever about what factors into the comparisons and associations apparent in authorship, enabling a given listing to stand out from the crowd in the SERPs. People want to pinpoint a cause and effect scenario. People want answers. SEO is like life. We cannot always give an explanation or find a scientific solution to questions being asked of us. For some time, I have been studying the application of algorithms in respect to human behaviour, animals and nature. Seven years ago, my fascination in complex adaptive systems was born, and my particular interest has been in social behavior. I have studied scientists and scientific publications to find "the most connected scientist" considering the citations and links found in the papers. What I hadn't predicted was the explosion of interest in and application of complex adaptive systems that I am now witnessing, nor that tasks in this area would become part of my daily work as a scholar, increasing my fascination with search engines. Google and other search engines are trying to explore the relationship between man, his experience, and his contextual thought process in order to understand his reasons for taking certain actions. This tendency towards humanisation, and therefore to the unforeseeable nature of a complex system, generates countless theories, false positive and wrong analysis of the algorithms being studied. SEO: Curiosity, determination, research and particular attention to detail In this post, I want to clearly state that I am not here to criticise nor attack anyone. Using a scenario commonly confronted by SEOs, I want to demonstrate how it is possible to identify problems, to assess content being churned out daily by the international community, to verify a hypothesis, reach a conclusion and then formulate a correct opinion from what has been learned. Please bear in mind, an opinion is all we can strive for in the absence of facts. I believe that we often accept what we read, hear and analyse as solid fact. All too often, the analysis of specific SEO problems misses the target due to insufficient depth of study and because there are no isolated variables subjected to examination. The recent release of Penguin and Panda has created a great deal of uncertainty and many interesting case studies, but few studies have made a meticulous effort to identify the real motives for which the penalties are imposed. What I present here is a simplified approach to the analysis of updates such as Penguin and Panda, but it will allow you to identify what are the causes that often lead to conclusions because of the desire to obtain a justification for the same process used to reach those same conclusions. In addition to identifying possible problems during the analysis, I will also look into Authorship markup, Google+ and Rich Snippets. I would appreciate community feedback, particularly if you can point out other cases that contradict my findings. The case under consideration: "Authorship" "Everything You Need To Know About Google Authorship in 8 Minutes" is an interesting, investigative example which, unfortunately, fails to hit the target. All hypotheses and insights that Chris Countey expressed in the video can be abolished in a matter of minutes by analysing more cases, more SERPs, more data. An analysis of this type leads to superficial conclusions and a message that misleads readers or listeners, potentially causing future SEO disasters. Rel=Author, Rel=Me and HTML4 or 5 There is no evidence that doctype and use of rel or of ?rel affect attribution or non-attribution of Authorship. In the example below, you can see how a doctype HTML4 together with rel=author and rel=me all function normally. Judging by past history, Google is not prone to taking doctype into consideration. Rel=Author and Profile Images Here, too, there are various interpretations which have to be considered. I have made some tests, taking into consideration the following factors: Avatars with illustrated graphics Generic images and lack of focus on the face Images with more than one person Images without any person or face Images that are not sharp/clear Images that are of a low quality Authority of the profile Let's examine these details further. Avatar Image Illustration As we can see from the following two files, there is absolutely no evidence that a profile picture or cartoon-style illustration prevents the display of same in the SERPs. Negative case   Positive case   Generic images which do not focus on the face As clearly visible from the following images, there is absolutely no evidence that a profile picture that doesn't focus on a human face prevents the display of same in the SERPs. Famous positive case   A less famous positive case   Image with more than one person Here is a screenshot of an avatar with two faces. Positive case   Image without face or persons This could be a plausible hypothesis, but evidence is to the contrary. Negative case   Positive case   Image is not sharp/clear and the image is of low quality If we followed Google's own advice about image quality, we might hypothesise that poor image quality could prevent display of an avatar in the SERPs. The following image, Keep Calm and Circle Me, renders even this hypothesis doubtful, however. Sharp image but not quality   Quality image but lacks clarity   Here we can see the same image as above (Image without face or persons - Positive case), which is very clear despite of its very low quality and not being sharp. Positive case   Authority of the profile A possible factor which excludes the face could be related to the authority of the profile, but again, evidence is against such a hypothesis. Negative case   Positive case NB: The case of John Mu could be dependent on the fact that more than one profile is open (which is a type of filtering of fake hypothesis?) but I think it's image related. This authorship is associated with a different profile from that shown above. https://profiles.google.com/johnmu.com/about https://plus.google.com/113006028898915385825/posts No firm conclusions, but a conclusion The above cases illustrate and validate a rule to detect possible instances of non-display, leading us to an important conclusion; namely, that if you search for your "first and last name Google" or even "site: plus.google.com in url:TUO_ID_GOOGLE_PLUS " and Google does not display your profile image on Google+ within the snippet in relation to your Google+ page, it will most likely never appear. Related to this we can say, without any doubt, that the image/photo of the profile is the main factor; something confirmed also by the following example here below (and by other tests I did as well). Change of image and attribution in SERP   Authorship with or without implementation through email? When analysing other sites, it is always difficult to draw conclusions. A case that could be misleading is, for instance, the following example that does not use any markup on the page but gets authorship recognition in the SERP. A superficial judgment is to assume that Google is not interested in the rel="author" implementation, whereas it is very probable that the email confirmation option has been used. So before jumping to conclusions, let's carefully evaluate each small possibility while moving forward. Authorship and rel=nofollow to Google+ profile Also in the video shown earlier in this post, it is noted that an author does not show in the SERPs despite everything being correctly associated. Specifically, Chris asked Rand why the link to his Google+ profile contained the rel=nofollow, imputing the missed authorship to this. To eliminate this theory takes very little effort and you can verify for yourself that using a url as the nofollow does not prevent attribution. Case of nofollow on link to g+   Possibly in the case described in the video, related to the article "How Authorship (and Google+) Will Change Linkbuilding", the missed authorship is not to be attribute to the use of the nofollow, as the screenshot shows. Related to the screenshot above (from the earlier video), among the possible reasons for the absence of Authorship in the SERPs may be: Search Plus Your World is active (in order to test the Authorship attribution, it is preferable to be logged out). Now Google shows the image of an Author only once per SERP, and probably in the example the second attribution prevails over the first (however this is not the case, because the "by ..." should remain visible). The type of search query realized (which is not reported in the video). Social search and therefore the sharing of our friends were considered more relevant than the author in this case. I am currently investigating the file robots.txt and I am unable to resolve or find anything. Authorship and meta robots noindex on the author page To verify the noindex case, I made a test with the result that the noindex in the author page is a big issue for the attribution even if the rich snippet testing tool returns an ok. In the image below I present three pages of the same site, where one is using the author page with noindex. Just with a look at the SERPs, we can confirm that a noindex tag on the author page is a real issue. Authorship and tab +1 on Google+ profile Forums and posts that I have read provide some advice on making public the tab +1 to ensure authorship works. Unfortunately, this is not actually one of the factors that should be taken into account. Authorship + snippet with number of circles Another element that we can observe is the number of circles in which an author is present. This element seems depending mainly on two factors: The total number of circles in which the author is added has to be >500 [BEFORE 13 June, 2012]; The association between the author and the search query. Here we can see some examples where it appears or does not appear snippet 'in XXX searches'. Comparison between the account with Circles number >500 and <500 with related search (first name and surname) Thanks to this research it is possible to understand the value of the number of circles in which a user is present and, therefore, if this data will appear in the Authorship snippets or not. Experiment with research and behaviours related to snippets   Borderline case to verify that the limit is effectively >500 To accomplish this I was able to find an account with 490 searches and one with 515 searches, undertaking a related search to both. To swiftly identify users of around the 500 searches, I utilised this tool. With 490 circles, the number of circles is not displayed   With 515 circles, the number of circles is displayed   Relevance of search and number of circles In this case, if the other authors were circled by >500 people probably they would obtain the additional snippet as in my case. Case which shows the relevancy and the number of circles   In the following case, however, you can see how the additional element may quite probably depend on the relevance of the search. In the case above, in fact, I show up with the circles number snippet, but if I search for a different name where I appear (case below), but I'm not so relevant, then the number circles snippet disappears. Case to which there is no relevance and therefore without snippets of circles   Continuous changes Making the same search of 28 May on 6 June, I saw a big change that invalidates my first hypothesis. I'll show you what this was: Marginal factor or not? It is only a stupid meaningless number, or does it mean something more? Personally I consider that that "little number" may help us understanding the great complexity that lies behind Authorship and Search, because it clearly indicates how Google is able to associate, understand and contextualise people to searches. Authorship, YouTube and rich snippet mixed Many believe that Authorship in the SERPs consists merely of the visualisation of the face and description snippet, but this is not so. Authorship is expressed more specifically with the snippet "by Firstname Lastname". This allows us (as shown in the example below) to connect YouTube to Google+ and obtain the Authorship in SERPs merged with the video snippets. In the image we can see a rich snippet showing the video uploaded by Giorgiotave with the Authorship snippet below along with a smaller image. This allows us to see how the SERPs are becoming more and more expressive. In regard to the variety of snippets and their display, I consider very interesting reading this paper about social annotations and Web Search, which - on a macro level - describes in detail the study process implied with each small addition to the interface of a Search Engine, while - on a micro level - describes the effects that the social annotations have on the behaviour of the users and how it varies at any smallest change.  Contains multi-author verified and unverified In the following examples, I've added more links of authorship (using ?Rel=author) comparative to a post with questionable content. I'm looking to understand what would happen in a scenario where pages with several authors including both profiles are unverified by 'contributor of' and others instead being verified. In the example shown, two profiles are verified while the remaining four are unverified. Test multi author with unverified and verified   Google has apparently ruled out the authorship of the post due to the probability that the primary link of authorship does not confirm the association override and does not proceed to search for successive theory [hypothesis]. Let's evaluate what is effectively so and perform a test on the same post dismissing the authorship, by not confirming prior to firstly using the rich snippet testing tool to confirm and verifying revalidate. Multi author first verified and then unverified   Apparently, the assumption seems to be founded, but to confirm the hypotheses we must obviously perform a similar test on a new post. This will enable us to see what happens in the SERPs. Here is a test with two authors verified. Contains multi author with two authors verified I carried out a test introducing an article with two verified authors. Unlike the day before, the rich snippets testing tool encountered an error identifying the rel=publisher as if the author were not verified, although no errors were implemented. Two authors and one page badge   Contradicting the hypothesis above, but not as expected, the use of two verified authors using rel=author+ page author+ rel=me causes missing visualisation of the authorship in SERP even if the fault seems attributable due to the badge of the pages: Perhaps a bug in the rich snippet testing tool? That the rich snippets testing tool considers the first g+ URL before any other url? The search engine will have the same behaviour of the tool? This notification is absurd. This invalidated the test and so we had to perform a new test. Test with two verified authors: one via ?Rel=author and one via rel="author"+page author+rel="me" In this case, the rich snippets testing tool catches (and show) the first author that it finds in the html code of the page, but in the SERP there is no attribution, as evident in the image below (in the red part). More authors and no authorship   At this stage, our examination of new test should be in place: Test with two authors verified via ?rel=author, Test with two authors verified via rel="autor"+ page author+ rel="me" and without URL plus present Google in the page. What response would Google provide in the case of failure to display? In this help article, Google suggests that there are alternative cases for which the author may not appear in the SERPs. Surely, one of the elements to observe is that of the relative "on-page markup" as well as "profiles picture" discussed above. The official support from Google   What can we learn from this case? Regardless of the specific case and the assessments evaluated on rel=author, this case analysis shows us how we should act when we wish to obtain certain answers about the behaviour of the search engine. Therefore, we can define some key principles for the work we do every day: Collect information and cross examine it with a critical mind. Search for other opinions and experiments related to the information you've found and cross examine it with a critical eye. Read the official documentation, not to consider it as evidence, but simply as a starting point to define your hypothesis. Formulate one hypothesis at any one time and place it into question. Involve colleagues and friends to examine the case so that you are able to provide further views and more cases. When you obtain a large amount of data and tests that are consistent, try to demonstrate the accuracy with reality and specific testing. Urgency is not an issue; if something does not or cannot prove your hypothesis due to the lack of feedback, begin again until your hypothesis is not refuted by the facts. If you can prove your hypothesis, make it public and prepare to be disproven. SEO is a more than words. SEO is a common sense approach to the problems of everyday life. And here's a present for you... 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!

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6 Simple Tips to Make Your Blog More Engaging

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6 Simple Tips to Make Your Blog More Engaging Posted: 11 Jul 2012 04:42 AM PDT Getting visitors to go through your blog and enjoy what you have written isn’t the easiest thing on the planet. It requires time, patience and a lot of practice. To see evidence of visitor engagement you should see signs of regular activity and so should the visitor. Here is some simple advice which might help keep your visitors engaged with your site and encourage them to come back for more. Your goals should be: Receiving relevant comments People linking to & sharing your content Repeat visitors to your blog Build relationships The real aim is to keep your content interesting and be proactive. Here are some tips for achieving these goals: 1. Evoke a response There are a number of ways of evoking a response in your posts. One useful tip to make your articles more engaging is to write as if you are speaking to the reader directly. Use 'you' or 'your' rather than 'them', 'they' or 'it'. Simply asking questions throughout your blogpost can work wonders; particularly when the question is up for debate and/or it appeals to the reader emotionally. Posing a question in the title of your blogpost can also help to draw in visitors. If you have a successful post, defined as one which someone has read to the end, having a meaningful question or statement as the last point can motivate readers to comment on your post. 2. Super-Shorten those paragraphs Long drawn out text can distract visitors; it can even make your visitors go somewhere else. Break text up into shorter paragraphs; it is easier on the eye and more digestible for readers. Take a look at the BBC's news articles which are a prime example of breaking paragraphs into short bursts of sentences. 3. Include subtitles & bulleted lists A meaningful chunk of grouped data goes down very well with those readers seeking information. Grouping paragraphs that are related to each other and giving them a relevant title helps users to know precisely what you are talking about. This is especially useful for people that scan the content, i.e. visitors quickly reading your post to find the parts which interest them. Also, for every 3-5 paragraphs, group the paragraphs together and give them a short subtitle that describes their content succinctly. Subtitles can invite users to delve deeper if they catch their eye. Breaking down items into bulleted lists also achieves this effect and helps legibility. Even bolding a relevant phrase or sentence can help divert the eye into reading certain sections of your post. 4. Include media: video, images and files Relevant and, depending on your niche, funny pictures or videos can also help. Relevant pictures, diagrams, infographics, etc. can evoke readers' interest and result in them reading more content. Remember to place media, especially if you have pictures, higher up in the document. Visually engaging your visitors using media "above the fold" can really help to draw them in. 5. Keep errors to a minimum Spelling errors and inaccuracies in your content can have people fleeing your website in droves. In fact, you are more likely to generate comments on how bad your English is or the inaccurate data that you are providing. Nobody is perfect but make an effort to keep errors to a minimum. Check your facts, use a spellcheck, even put your post through a word program to check for grammatical errors if you have to. 6. Engage Yourself – Get Proactive If you are lucky enough to have genuine comments on your post, have it tweeted by someone, or even blogged about, try to respond with a reply back as soon as possible. It shows you are active and that you are interested in the topic. It also shows that you care about your readers and their views. Some users will come back if they have something further to add. If the article is good enough, a chain effect can happen where users will comment on other comments that have been made. When producing content there are other tactics which can increase activity on your posts, for instance, taking a cynical or slightly negative view  on someone or something which is popular (although err on the side of caution with this technique as you might get detractors). Another idea is blogging about your top 10 list on a particular subject. This is an easy way to quickly generate new content. You could also visit other blogs on similar topics and leave a comment.  You could even answer with a link to your own post. Another idea is to contact an authority on your chosen topic and ask them what they think. You could tweet them or do it directly on their site. There's nothing wrong with being proactive and you never know, it could be the start of a very beneficial relationship. What are you waiting for – go for it! Ultimately, if you apply some of the simple rules above and you are producing interesting articles/posts you should see results; usually from both user activity and an increase in your rankings too. If you have any other useful tips, feel free to share them here. Image Credit: alamodestuff © SEOptimise - Download our free business guide to blogging whitepaper and sign-up for the SEOptimise monthly newsletter. 6 Simple Tips to Make Your Blog More Engaging Related posts: Poll: What Are the Most Important Factors That Make a Blog Post go Viral? Significant Traffic Sources You Probably Miss Unless You Blog SEOptimise’s 58 most awesome blog posts of 2011

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Seth's Blog : The puzzle joint

The puzzle joint

Nick Schade makes beautiful handmade kayaks. One model is 18 feet long and it's built from plywood. The problem, of course, is that plywood comes in 8 foot long sheets.

Most people would work to hide the joint, to minimize it, to make it as invisible as possible. "Hey, if we have to do this, let's pretend we don't."

Nick stains the two pieces different colors and makes it into a feature. If you have a limit, perhaps it's worth embracing.

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Mish's Global Economic Trend Analysis

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• San Bernardino, California, Weighs Chapter 9 Bankruptcy; That Seals the Fate
• Egan Jones Lowers Credit Rating of Netherlands, Austria; Time to Break Up the Rating Agency Cartel Revisited
• German Constitutional Court May Take 3 Months to Rule on ESM; Finance Minister Wolfgang Schäuble Warns of "Uncertainty"
• China Import Growth Plunges, Trade Surplus Hits 3-Year High; Will US Response Be Protectionism? Is China Headed For a Deflationary Shock?

San Bernardino, California, Weighs Chapter 9 Bankruptcy; That Seals the Fate Posted: 10 Jul 2012 07:44 PM PDT When you see headlines like this: San Bernardino, California, Weighs Chapter 9 Bankruptcy, you know 100% without a doubt the city is bankrupt, and the only question pertains to the filing. From the Bloomberg headline story .... San Bernardino may become the third California city in two weeks to file for municipal bankruptcy protection, as it struggles with declining tax revenue, growing employee costs and ill-timed public-works projects. The City Council is to consider authorizing the city attorney to file a Chapter 9 petition at a meeting late today, said Gwendolyn Waters, a spokeswoman. A decision was possible tonight, though unlikely, she said. A San Bernardino bankruptcy would follow Stockton, a community of 292,000 east of San Francisco, which on June 28 became the biggest U.S. city to file for bankruptcy. Mammoth Lakes, a mountain resort of 8,200, filed for protection from creditors on July 3 saying it can't afford to pay a $43 million judgment, more than twice its general-fund spending for the year. San Bernardino, a city of 209,000 east of Los Angeles, faces a $45 million deficit this fiscal year, according to a June 26 budget analysis posted on its website. The city has declared fiscal emergencies, negotiated for concessions from employees and reduced its workforce by 20 percent in four years, according to the report. The city is facing insolvency because of accounting errors, deficit spending, pension and debt costs, and lack of revenue growth, according to the report. Few Options "Cities are running out of options," Michael Sweet, a partner specializing in bankruptcy at the San Francisco office of law firm Fox Rothschild LLP, said today in a telephone interview. "As they see pension contribution obligations and retiree health-care costs going through the roof, revenue is at best stable if not declining." "The city's reserves and discretionary funds have been depleted, and the city faces insolvency," San Bernardino Interim City Manager Andrea Travis-Miller and Finance Director Jason Simpson wrote in a June 26 memo to the council. "Simply put, the city must now take substantial action to reduce its spending and increase revenues." According to its financial statements, the city and its agencies held $243 million of outstanding debt, including $48.6 million of taxable pension-obligation bonds outstanding. The city's debt per person was $1,506 or $5.37 percent of personal income. San Bernardino had $200 million of outstanding general- obligation bonds, according to the statement. Untenable Union Wages and  Pension Benefits to Blame Once again, deficit spending, union wages, and soaring pension obligations are at the heart of the matter. Los Angeles, Oakland, San Diego, and numerous other cities face the same fate. Just give it time. Excellent News Some people will look at this as bad news. However, this is excellent news. The only solution is to stick it to uncompromising public unions in bankruptcy court. Bankruptcy is the way forward. For more excellent news, please see Excellent Anti-Union News From Multiple Places Including US Supreme Court 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.

Egan Jones Lowers Credit Rating of Netherlands, Austria; Time to Break Up the Rating Agency Cartel Revisited Posted: 10 Jul 2012 12:30 PM PDT In a common sense move, Egan-Jones cuts Austrian, Dutch sovereign ratings. Credit rating agency Egan-Jones lowered Austria's rating to A from A-plus and cut the rating on the Netherlands to A from AA-minus. Both ratings have a negative watch. Northern European countries will absorb the cost of shoring up ailing neighbors, Egan-Jones said in separate statements on each rating action. And with Spain and potentially Italy looking for support, "two major economies will switch from providers to users of funds. Our view is that the longer the euro crisis continues, the lower the ultimate recoveries," the statements read. Big-3 Behind the Curve The always behind the times "Big Three" (Moody's, Fitch, and the S&P) maintain AAA status on the Netherlands, with Fitch alone having a negative watch. Time to Breakup the Rating Agency Cartel   Egan-Jones gets business on the basis of accuracy. It has a vested interest in doing a good job. The Big Three get business by government mandate. They primarily get paid on the volume of business they do. What follows are snips from my post Time To Break Up The Credit Rating Cartel, written September 28, 2007, long before the rating agency AAA scam on sliced, diced, and tranched mortgage-debt was fully exposed. .... The rating agencies were originally research firms. They were paid by those looking to buy bonds or make loans to a company. If a rating company did poorly it lost business. If it did poorly too often it went out of business. Low and behold the SEC came along in 1975 and ruined a perfectly viable business construct by mandating that debt be rated by a Nationally Recognized Statistical Rating Organization (NRSRO). It originally named seven such rating companies but the number fluctuated between 5 and 7 over the years. Establishment of the NRSRO did three things (all bad): 1) It made it extremely difficult to become "nationally recognized" as a rating agency when all debt had to be rated by someone who was already nationally recognized. 2) In effect it created a nice monopoly for those in the designated group. 3) It turned upside down the model of who had to pay. Previously debt buyers would go to the ratings companies to know what they were buying. The new model was issuers of debt had to pay to get it rated or they couldn't sell it. Of course this led to shopping around to see who would give the debt the highest rating. Problems arose because the free market was disrupted by a misguided mandate by the SEC. Those interested in more information on this topic can read Removing a Regulatory Barrier by Senate Republican Jon Kyl or Creating a Competitive Rating Agency Sector by the American Enterprise Institute. The Solution is Amazingly Easy Government sponsorship of organizations and intervention into free markets always creates these kinds of problems. The cure is not an executive shuffle, third party verification or half-measures and more regulation that mask over the issues by splitting functions within an organization. The SEC created this problem by creating the NRSRO. The problem is easily fixable. It's time to break up the cartel by eliminating the rules that created it. Moody's, Fitch, and the S&P should have to sink or swim by the accuracy of their ratings just like everyone else. Free market competition, not additional regulation is the cure.  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.

German Constitutional Court May Take 3 Months to Rule on ESM; Finance Minister Wolfgang Schäuble Warns of "Uncertainty" Posted: 10 Jul 2012 10:13 AM PDT The "fast track" for constitutional review of the ESM in Germany just got a lot slower. Via Google Translate (further modified by me for clarity), Der Spiegel reports ESM Review Probably Longer Than Planned Karlsruhe - The Federal Constitutional Court fast track review of the euro rescue ESM and Fiscal Pact may take more time than previously thought. Chief Justice Andrew Voßkuhle announced at the hearing on Tuesday a "constitutionally reasonable inspection" of complaints could extend beyond a normal emergency procedures. This could, according to those involved take up to three months. The fast track was originally expected to last up to three weeks. Schäuble warns of market uncertainty Finance Minister Wolfgang Schäuble (CDU), stated that in his opinion a clear shift of the July ESM also "could mean a considerable uncertainty in the markets." A stop of the bailout could lead to "serious economic dislocation, with unforeseeable consequences" for the Federal Republic, said Schäuble. "Avoid constitutional doubts about the ability or the willingness of the Federal Republic of Germany, threats to the stability of the euro zone could lead to the current crisis symptoms were significantly increased," said Schäuble. The speculation about the euro-exit of some countries would be fueled. This brings no foreseeable risks for the German economy, such as during the 2009 crisis, the minister said. The last two paragraphs above are as directly translated. The rest contains slight rewordings by me for ease in reading. Reflections on "Uncertainty" This is one of the few recent instances of the use of the word "uncertainty" that actually makes any sense. In most other instances lately, the word "uncertainty" was conveniently substituted for something tantamount to  "economy is clearly falling apart". In this case we do not know how the court will rule. However, that the ruling may take as long as three months is a clear indication the recent challenges to the ESM are not a trivial matter that can be easily dismissed. That much is certain. So is the fact that Schäuble doesn't care for that message one bit. Tough. 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.

China Import Growth Plunges, Trade Surplus Hits 3-Year High; Will US Response Be Protectionism? Is China Headed For a Deflationary Shock? Posted: 10 Jul 2012 02:51 AM PDT China's trade surplus hit a 3-year high this month as import growth plunged. That setup raises many questions. First, let's consider the initial story. Bloomberg reports China's Import Growth Misses Estimates for June China's imports rose less than anticipated in June, pushing the trade surplus to a three-year high and adding pressure on the government to support demand as the global economy slows. Inbound shipments increased 6.3 percent from a year earlier, the customs bureau said in a statement today in Beijing, compared with the 11 percent median estimate in a Bloomberg News survey of 32 economists. Export growth slowed to 11.3 percent and the trade surplus rose to $31.7 billion. Rising surpluses may further strain trade relations with the U.S., which surpassed the European Union in the first half as China's biggest foreign market and is in the midst of a presidential election marked by criticism of the Asian nation. The country's trade surplus with the U.S. and lack of currency gains have been issues in the U.S. election campaign this year, as American job growth slowed last quarter. Mitt Romney, the Republican presidential candidate, has criticized President Barack Obama as too soft on China. At the same time, Obama has expanded trade complaints against the nation: Last week he accused it of imposing unfair taxes on American vehicles, mostly from General Motors Co. and Chrysler Group LLC. Will US Response Be Protectionism? Mitt Romney has pledged to designate China a "currency manipulator" and impose duties on its imports if the yuan isn't allowed to float freely. If Romney increases tariffs three things will happen, all of them bad. Prices will rise Growth will slow China will retaliate with tariffs of its own or by buying more goods from Europe instead of  goods from US produces  In essence everyone will pay higher prices for goods and services in hopes of bring back a few hundred manufacturing jobs (while losing tens-of-thousands of jobs in the ensuing economic slowdown). Agreement With Lagarde It is not often I agree with IMF head Christine Lagarde, but this time I do. Please consider IMF's Lagarde urges caution over protectionism IMF Managing Director Christine Lagarde on Tuesday said the global economic situation was worrisome and urged countries to be cautious of protectionism. Lagarde described as "quite alarming" a report published by the World Trade Organization in June which said the world's trading nations were succumbing to protectionism in the wake of the global financial crisis. Cusp of Deflationary Vortex? Ambrose Evans-Pritchard writing for The Telegraph proposes China Headed For a Deflationary Shock China is on the cusp of a deflationary vortex. This was signalled late last year by the sharpest contraction in the (real) M1 money supply since modern records began. The hard data is now confirming the warnings. Consumer prices have been falling for the last three months, producer prices have been falling for four months. This is not a food cost story. It is systemic. Is this the long-feared hard landing? Of course it is. The problem was the explosive growth of credit in the preceding years. This is roughly twice the intensity of credit growth – around 50 percentage points of GDP – before the US and Japanese blow-offs. There seems to a near universal assumption that China can pull the levers of the state banking system and set off a fresh credit boom whenever it wants. Well, perhaps, but loan demand has withered. The big four banks lent just 190bn yuan in June, down from 253bn in May. "Large banks are all offering money, but no one is taking it," said a Shanghai dealer quoted by Reuters. This is more or less what happened in Japan in the 1990s, what is happening in Europe now. It is what happened to half the world in the 1930s. But at the end of the day, the country is bursting with industrial over-capacity. Woe betide the world if China does indeed land with a thud. We will then have a synchronised planetary slump for the first time since you know when. Less for More vs. More for Less Pritchard correctly cites the problem as the "explosive growth of credit in the preceding years." While not proposing a direct solution (thankfully - because I nearly always disagree), Pritchard fears something that needs to happen. In a comment to Pritchard's post, Pater Tenebrarum responds "It would of course be excellent news for all of us if we were indeed flooded with cheap goods. Who wants to pay more for goods instead of less? Apparently paying less is considered a great calamity. Not by me though, and I feel pretty certain that there are a few billion consumers who would agree with me." Count me in the group of a few billion people who would gladly pay less for more, rather than more for less. 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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