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miercuri, 8 aprilie 2015

Off with Your Head Terms: Leveraging Long-Tail Opportunity with Content - Moz Blog

Off with Your Head Terms: Leveraging Long-Tail Opportunity with Content

Posted on: Wednesday 08 April 2015 — 02:15

Running an agency comes with many privileges, including a first-hand look at large amounts of data on how clients' sites behave in search, and especially how that behavior changes day-to-day and month-to-month.

While every niche is different and can have subtle nuances that frustrate even the most hardened SEOs or data analysts, there are undoubtedly trends that stick out every so often which are worthy of further investigation.

In the past year, the Zazzle Media team has been monitoring one in particular, and today's post is designed to shed some light on it in hopes of creating a wider debate.

What is this trend, you ask? In simple terms, it's what we see as a major shift in the way results are presented, and it's resulting in more traffic for the long tail.

2014 growth

It's a conclusion supported by a number of client growth stories throughout the last 12 months, all of whom have seen significant growth coming not from head terms, but from an increasing number of URLs gaining search traffic from organic.

The Searchmetrics visibility chart below is just one example of a brand in the finance space seeing digital growth year-over-year as a direct result of this phenomenon. They've even seen some head terms drop backwards by a couple of places while still seeing this overall.

To understand why this may be happening we need to take a very quick crash course into how Google has evolved over the past two years.

Keyword matching

Google built its empire on a smart system; one which was able to match "documents" (webpages) to keywords by scanning and organizing those documents based upon keyword mentions.

It's an approach that has been getting increasingly too simplistic in a "big data" world.

The answer, it seems, is to focus more on the user intent behind that query and get at exactly what it is the searcher is actually looking for.

Hummingbird

The solution to that challenge is Hummingbird, Google's new "engine" for sorting the results we see when we search.

In the same way that Caffeine, the former search architecture, allowed the company to produce fresher results and roll worldwide algorithm changes (such as Panda and Penguin) out faster, Hummingbird is designed to do the same for personalized results.

And while we are only at the very beginning of that journey, from the data we have seen over the past year it seems to be crystallizing into more traffic for deeper pages.

Why is this happening? The answer lies in further analysis of what Google is trying to achieve.

Implicit vs. explicit

To better explain this change let's look at how it is affecting a search for something obvious, like "coffee shop."

Go back two or so years and a search for this may well have presented 10 blue links of the obvious chains and their location pages.

For the user, however, this isn't useful—and the search giant knows it. Instead, they want to understand the user intent behind the query, or the "implicit query," as previously explained by Tom Anthony on this blog.

What that means, in practice, is that a search for "coffee shop" will actually have context, and one of the reasons for wanting you signed in is to allow the search engine to collect further signals from you to help understand that query in detail. That means things like your location, perhaps even your brand preferences, etc.

Knowing these things allows the search to be personalized to your exact needs, throwing up the details of the closest Starbucks to your current location (if that is your favourite coffee).

If you then expand this trend out into billions of other searches you can see how deeper-level pages, or even articles, present a better, more refined option for Google.

Here we see how a result for something like "Hotels" may change if Google knows where you are, what you do for a living and therefore what kind of disposable income you have. The result may look completely different, for instance, if Google knows you are a company CEO who stays in nice hotels and has a big meeting the following day, thus requiring a quiet room so you can get some sleep.

Instead of the usual "best hotels in London" result we get something much more personalised and, critically, something more useful.

The new long-tail curve

What this appears to be doing is reshaping the traditional long-tail curve we all know so well. It is beginning to change shape along the lines of the chart below:

That's a noteworthy shift. With another client of ours, we have seen a 135% increase in the number of pages receiving traffic from search, delivering a 98% increase in overall organic traffic because of it.

The primary factor behind this rise is the creation of the "right" content to take advantage of this changing marketplace. Getting that right requires an approach reminiscent of the way traditional marketing has worked for decades—before the web even existed.

In practice, that means understanding the audience you are attempting to capture and, in doing so, outlining the key questions they are asking every day.

This audience-centric marketing approach is something I have written about previously on this blog and others, as it is critical to understanding that "context" and what your customers or clients are actually looking for.

The way to do that? Dive into data, and also speak to those who may already be buying from or working with you.

Digging into available data

The first step of any marketing process is to collect and process any and all available information about your existing audience and those you may want to attract in the future.

This is a huge subject area—one I could easily spend the next 10,000 words writing about—but it has been covered brilliantly on the more traditional research side by sites like this and this.

The latter of those two links breaks this side of the research process into the two key critical elements you will need to master to ensure you have a thorough understanding of who you are "talking" to in search.

Quantitative concentrates on the numbers. Focus is on larger data sets and statistical information, as opposed to painting a rich picture of the likes and dislikes of your audience.

Qualitative focuses on the words and on painting in the "richness." The way your customers speak and explain problems, likes and dislikes. It's more of a study on human behavior than stats.

This information can be combined with a plethora of other data sources from CRMs, email lists, and other customer insight pots, but where we are increasingly seeing more opportunity is in the social data arena.

Platforms such as Facebook can give all brands access to hugely valuable big-data insight about almost any audience you could possibly imagine.

What I'd like to do here is explain how to go about extracting that data to form rich pictures of those we are either already speaking to or the very people we want to attract.

There is also little doubt that the amount of insight you have into your audience is directly proportional to the success of your content, hence the importance of this research cycle.

Persona creation

Your data comes to life through the creation of personas, which are designed to put a human face on that data and group it into a small number of shared interest sets.

Again, the point of this post is not to explain how to best manage this process. Posts like this one and this one go over that in great detail—the point here is to go over what having them in place allows you to do.

We've also created a free persona template, which can help make the process of pulling them together much easier.

When you've got them created, you will soon realize that your personas each have very different needs from a content perspective.

To give you an example of that let's look at these example profiles below:

Here we can see three very distinct segments of the audience, and immediately it is easy to see how each of them is looking for a different experience from your brand.

Take the "Maturing Spender" for example. In this fictional example for a banking brand we can see he not only has very different content needs but is actually "activated" by a different approach to the buying cycle too.

While the traditional buyer will follow a process of awareness, research, evaluation and purchase, a new kind of purchase behaviour is materializing that's driven by social.

In this new world we are seeing consumers driven to more impulsive purchases that are often driven by social sharing. They'll see something in their social feeds and are more likely to purchase there and then (or at least within a few days), especially if there is a limited offer on.

Much of this is driven by our increasingly "disposable" culture that creates an accelerated buying process.

You can learn this and other data-driven insights from the personas, and we recommend using a good persona template, then adding further descriptive detail and "colour" to each one so that everyone understands whom it is they are writing for.

It can also work well to align those characters to famous people, if possible, as doing so makes it much easier to scale understanding across whole organizations.

Having them in place and universally adopted allows you to do many things, including:

Create focus on the customer
Allow teams to make and defend decisions
Create empathy with the audience

Ultimately, however, all of this is designed to ensure you have a better understanding of those you want to converse with, and in doing so you can map out the key questions they ask and understand their individual needs.

If you want to dig into this area more then I highly recommend Mike King's post from 2014 here on Moz for further background.

New keyword research – personas

Understanding the specific questions your audience is asking is where the real win can be found, and the next stage is to utilize the info gleaned from the persona process in the next phase: keyword research.

To do that, let's walk through an example for our Happy Couple persona (the first from the above graphic), and see how things plays out for this fictional banking brand.

The first step is to gather a list of tools to help unearth related keywords. Here are the ones we use:

1. SEMRush
2. Soovle
3. Keyword Tool IO
4. Google Autocomplete
5. Forum searches

There are many more that can help, but it is very easy to complicate the process with data, so we like to limit that as much as possible and focus on where we can get the most benefit quickly.

Before we get into the data mining process, however, we begin with a group brainstorm to surface as many initial questions as possible.

To do this, we will gather four people for a quick 15-minute stand-up conversation around each persona. The aim is to gather five questions from which the main research phase can be constructed.

Some possibilities for our Happy Couple example may include:

How much can I borrow for a mortgage?
How do I buy a house?
How large a deposit do I need to buy a house?
What is the best regular savings account?

From here we can use this framework as a starting point for the keyword research and there is no better place to start than with our first tool.

SEMRush

For those unfamiliar with this tool it is designed to make it easier to accurately assess competitor and market opportunity by plugging into search data. In this example we will use it to highlight longer-tail keyword opportunity based upon the example questions we have just unearthed.

To uncover related keyword opportunity around the first question we type in something similar to the below:

This will highlight a number of phrases related to our question:

As you can see, this gives us a lot of ammunition from a content perspective to enable us to write about this critical subject consistently without repeating the same titles.

Each of those long-tail terms can be analyzed ever deeper by clicking on them individually. That will generate a further list of even more specifically related terms.

Soovle

The next stage is to use this vastly underrated tool to further mine user search data. It allows you to gather regular search phrases from sites such as YouTube, Yahoo, Bing, Answers.com and Wikipedia in one place.

The result is something a little like the below. It may not be the prettiest but it can save a lot of time and effort as you can download the results in a single CSV.

Google Autocomplete / KeywordTool.io

There are several ways you can tap into Google's Autocomplete data and with an API in existence there are a number of tools making good use of it. My current favourite is KeywordTool.io, which actually has its own API, mashing data from Google, YouTube, Bing, and the Apple App Store.

The real value is in how it spits out that data, as you are able to see suggestions by letter or number, creating hundreds of potential areas for content development. The App Store data is particularly useful, as you will often see greater refinement in search behavior here and as a result very specific 'questions' to answer.

A great example for this would be "how to prequalify yourself for a mortgage," a phrase which would be very hard to surface using Google Autocomplete tools alone.

Forum searches

Another fantastic area worthy of research focus is forums. We use these to ask our peers and topic experts questions, so spending some time understanding what is being asked within the key ones for your market can be very helpful.

One of the best ways of doing this is to perform a simple advanced Google search as outlined below:

"keyword" + "forum"

For our example we might type:

This then presents us with more than 85,000 results, many of which will be questions that have been asked on this subject.

Examples include:

First-time buyer's mortgage guide
Getting a Mortgage: Boost your Mortgage Chances
Mortgage Arrears: What help is available?
Are Fixed Rate Mortgages best?

As you can see, this also opens up a myriad of content opportunities.

Competitive research

Another way of laterally expanding your reach is to look at the content your best competitors are producing.

In this example we will look at two ways of doing that, firstly by analyzing top content and then by looking at what those competitors rank for that you don't.

Most shared content

There are several tools that can give you a view on the most-shared content, but my personal favourites are Buzzsumo or the awesome new ahrefs Content Explorer.

Below, we see a search for "mortgages" using the tool, and we are presented with a list of content on that subject sorted by "most shared." The result can be filtered by time frame, language, or even by specific domain inclusions or exclusions.

This data can be exported and titles extracted to be used as the basis of further keyword research around that specific topic area, or within a brainstorm.

For example, I might want to look at where the volume is from an organic search perspective for something like "mortgage paperwork."

I can type this term into SEMRush and search through related phrases for long-tail opportunity on that specific area.

Competitor terms opportunity

A smart way of working out where you can gain further market share is to dive a little deeper into your key competitors and understand what they rank for and, critically, what you don't.

To do this, we return to SEMRush and make use of a little-publicized but hugely useful tool within the suite called Domain Comparison Tool.

It allows you to compare two domains and visualize the overlap they have from a keyword ranking perspective. For this example, we will choose to compare two UK banks – Lloyds and HSBC.

To do that simply type both domains into the tool as below:

Next, click on the chart button and you will be presented with two overlapping circles, representing the keywords that each domain ranks for. As we can see, both rank for a similar number of keywords (the overall number affects the size of the circles) with some overlap but there are keywords from both sides that could be exploited.

If we were working for HSBC, for instance, it would be the blue portion of the chart we would be most interested in in this scenario. We can download a full list of keywords that both banks rank for, and then sort by those that HSBC don't rank for.

You can see in the snapshot below that the data includes columns on where each site ranks for each keyword, so sorting is easy.

Once you have the raw data in spreadsheet format, we would sort by the "HSBC" column so the terms at the top are those we don't rank for, and then strip away the rest. This leaves you with the opportunity terms that you can create content to cover, and this can be prioritized by search volume or topic area if there are specific sub-topics that are more important than others within your wider plan.

Create the calendar

By this point in the process you should have hundreds, if not thousands of title ideas, and the next job is to ensure that you organise them in a way that makes sense for your audience and also for your brand.

Content flow

To do this properly requires not just a knowledge of your audience via extensive research, but also content strategy.

One of the biggest rules is something we call content flow. In a nutshell, it is the discipline of creating a content calendar that delivers variation over time in a way that keeps the audience engaged.

If you create the same content all of the time it can quickly become a turn-off, and so varying the type (video, image-led piece, infographics, etc.) and read time, or the amount of time you put into creating the piece, will produce that "flow."

This handy tool can help you sense check it as you go.

Clearly your "other" content requirements as part of your wider strategy will need to fit into this strategy, too. The vast majority of the output here will be article-focused, and it is critical to ensure that other elements of your strategy are also covered to round out your content output.

This free content strategy toolkit download gives you everything you need to ensure you get the rest of it right.

The result

This is a strategy we have followed for many of our search-focused clients over the last 18 months, and we have some great real-world case studies to prove that it works.

Below you can see how just one of those has played out in search visibility improvement terms over that period as proof of its effectiveness.

All of that growth directly correlates with a huge growth in the number of URLs receiving traffic from search and that is a key metric in measuring the effectiveness of this strategy.

In this example we saw a 15% monthly increase in the number of URLs receiving traffic from search, with organic traffic up 98% year-on-year despite head terms staying relatively static.

Give it a go for yourself as part of your wider strategy and see what it can do for your brand.

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Get Unbeatable Insights into Local SEO: Buy the LocalUp Advanced Video Bundle

Posted on: Tuesday 07 April 2015 — 13:31

Posted by EricaMcGillivray

Missed LocalUp Advanced 2015? Forgot to take notes, or just want to relive the action? You can now purchase the bundle of 13 videos in order to get all the knowledge our speakers shared about local SEO in. Dive deep and learn how to wrangle content, get reviews, overcome technical mobile challenges, and so much more from top industry leaders.

Moz and Local U are offering a super-special $99 deal for everyone—an unbeatable value for anyone looking to level-up their local SEO skills.

Buy the LocalUp Advanced Video Bundle

Get a preview of what you'll learn and hear what attendees had to say about how much they enjoyed it:

LocalUp Advanced 2015 Video Sales Promo

In addition to the videos, you also get the slide decks. Follow along and go back as you start implementing these tips into your strategy and work. You can watch these videos and download them to any device you use: desktop, laptop, tablet, and mobile.

Watch the following great talks and more:

Getting Local Keyword Research and On-page Optimization Right with Mary Bowling Local keyword data is often difficult to find, analyze, and prioritize. Get tips, tools, and processes for zeroing in on the best terms to target when optimizing your website and directory listings, and learn how and why to structure your website around them.

Exposing the Non-Obvious Elements of Local Businesses That Dominate on the Web with Rand Fishkin In some categories and geographies, a local small business wholly dominates the rankings and visibility across channels. What are the secrets to this success, and how can small businesses with remarkable products/services showcase their traits best online? In this presentation, Rand digs deep into examples and highlight the recurring elements that help the best of the best stand out.

Local Content + Scale + Creativity = Awesome with Mike Ramsey If you are wondering who is crushing it with local content and how you can scale such efforts, then tune in as Mike Ramsey walks through ideas, examples, and lessons he has learned along the way.

Don't Just Show Up, Stand Out with Dana DiTomaso Learn how to destroy your competitors by bringing personality to your marketing. Confront the challenges of making HIPPOs comfortable with unique voice, keep brand standards while injecting some fun, and stay in the forefront of your audience's mind.

Playing to Your Local Strengths with David Mihm Historically, local search has been one of the most level playing fields on the web with smaller, nimbler businesses having an advantage as larger enterprises struggled to adapt and keep up. Today, companies of both sizes can benefit from tactics that the other simply can't leverage. David shares some of the most valuable tactics that scale—and don't scale—in a presentation packed with actionable takeaways, no matter what size business you work with.

Wondering if it's truly "advanced?"

79 percent of attendees found the information perfectly advanced

Seventy-nine percent of attendees found the LocalUp Advanced presentations to be at just the right level.

Buy the LocalUp Advanced Video Bundle

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Seth's Blog : Two heads or one?

Two heads or one?

As a company gets bigger, there's an inevitable split between the people who market what gets made and the people who design what gets made.

At some organizations, it's likely that these two people work in different buildings, and don't spend much time together.

One of the most important decisions made in the early days of JetBlue was that the woman in charge of marketing the airline was also in charge of hiring and training. Amy designed the product and the marketing, both.

This was certainly one of the things Steve Jobs brought to the table as well.

There are a lot of reasons that this is quite difficult to pull off. That doesn't mean it isn't important.

• Email to a friend •

marți, 7 aprilie 2015

Mish's Global Economic Trend Analysis

Expansion of Disability Fraud Under Obama: Puerto Ricans Get U.S. Disability Benefits for Inability to Speak English; Disability Deal Explained
Stupidity of Negative Interest Rates Expands to Spain; Deflation Shock Thesis
Obama's Trans-Pacific Partnership Fiasco vs. Mish's Proposed Free Trade Alternative; How Will TPP Function in Practice?

Expansion of Disability Fraud Under Obama: Puerto Ricans Get U.S. Disability Benefits for Inability to Speak English; Disability Deal Explained

Posted: 07 Apr 2015 04:56 PM PDT

New Meaning of Disability

Here is a curious story on the meaning of "disability".

Please consider Lack of English Meant Puerto Ricans Got Disability Benefits.

A federal audit has found that some Puerto Ricans living in the U.S. territory have received disability benefits in part because they could not speak English.

The Office of the Inspector General for the Social Security Administration said in a report issued this month that there were 218 cases from 2011 to 2013 in which benefits were granted under those circumstances.

The report said Social Security determined it was difficult for those people to find a job because they did not speak English, but the inspector general said they could have found work given their Spanish-speaking skills in a largely Spanish-speaking island.

More Details

The above version is from ABC News. In another curiosity, Sputnik News, appears to have far more details.

The US Social Security Administration has been offering disability benefits to Spanish speakers living in Puerto Rico based on their inability to speak English, despite Spanish being the territory's primary language.

The US Social Security Administration [SSA] has been handing out disability benefits to Puerto Ricans due to the fact that they only speak Spanish. This is despite the fact that Spanish, one of the US territory's two official languages, is the dominant tongue and is spoken by over 95 percent of the population.

According to findings released last week by the Office of the General Inspector of the SSA, the organization "has applied the medical-vocational guidelines nationally and does not make exceptions for claimants who reside in Puerto Rico, where both Spanish and English are the official languages," leading to payouts for people living in Puerto Rico who don't speak English.

Workers at the SSA use grids of medical-vocational guidelines to assess whether or not an individual is entitled to disability benefits, which can be claimed if a person is unable to communicate in English, and therefore limited in his or her ability to find a job.

"We identified 218 cases in Puerto Rico from Fiscal Years 2011 to 2013 where disability determination services used the aforementioned grid rules to grant benefits," said the report.

"Moreover, about 4 percent of the hearings we sampled involved these same grid rules." wrote the auditors. The true figure could be even higher, since those writing the report had "incomplete management information," on claimants which had been awarded disability payments according to the grid rules due to their inability to speak English.

The report referred to a 1987 US District Court judgment that "it is the ability to communicate in Spanish, not English, that is vocationally important in Puerto Rico." and recommended that the SSA "evaluate the appropriateness of the grid rules," in such circumstances.

According to data from the US Census Bureau, 95 percent of Puerto Rico's 3.5 million inhabitants speak Spanish at home, and 84 percent report that they do not speak English "very well."

Disability Fraud

This is yet another example of growing disability fraud under Obama. From a payout standpoint, 218 cases is rather minor.

Yet, it's the attitude about what is considered a "disability" that is galling.

I have written about Disability Fraud at least a dozen times.

60 Minutes: Mainstream Media Finally Catches on to Disability Fraud: 60 Minutes Reports on "Disability USA"

Steve Kroft on 60 Minutes reports on the alarming state of the federal disability program, which has exploded in size in the last six years and could become the first federal benefits program to run out of money.

NPR: Unwilling to Work; 25% in Hale County AL Collect Disability, 14 Million Nationwide

How Easy is it to Get Disability?

Hale county's Dr. Timberlake asks a simple question to all his patients. "What grade did you finish?" If you claim "back pain" and do not have a degree, Timberlake believes you are disabled.

The Disability Deal

Getting disability seems easy enough in some states, and especially easy in Hale County Alabama. But is disability better than minimum wage? The answer is yes. NPR author Chana Joffe-Walt explains: ....

States Promote Fraud: States Have an Incentive to Promote (Not Stop) Disability Fraud; So How Much Fraud Is There?

This all goes back to 1996 when president Bill Clinton promised to "end welfare as we know it". He did indeed do just that, and fraud is the result.

Why?

The federal government pays disability, but states pay part of welfare costs. This creates a huge incentive for states to actively promote disability fraud (simply to get people off state-sponsored welfare programs).

Results of Clinton Ending Welfare "As We Know It"

Every month 14 million Americans receive a disability check.
In 1961 the leading cause of disability was heart disease and strokes, totaling 25.7% of cases. Back pain was 8.3% of cases.
In 2011 the leading cause of disability was a hard to disprove back pain, totaling 33.8% of cases. The second leading cause was an equally difficult to disprove "mental illness" at 19.2%. Strokes and heart disease fell to 10.6%.
In West Virginia, a whopping 9% of the population collects disability checks. In Arkansas, 8.2% are on disability, and in Alabama and Kentucky, 8.1% collect disability. In Alaska, Hawaii, and Utah, the figure is 2.9%.
In Hale County Alabama 1 in 4 receive disability checks.
Nearly every case in Hale County Alabama has Dr. Perry Timberlake in common.
Those on Supplemental Security Income, a program for children and adults who are both poor and disabled is nearly seven times larger than 30 years ago.
Once people go onto disability, they almost never go back to work. Fewer than 1 percent of those who were on the federal program for disabled workers at the beginning of 2011 have returned to the workforce.

Dr. Timberlake asks a simple question to all his patients. "What grade did you finish?" If you claim "back pain" and do not have a degree, Timberlake believes you are disabled.

Timberlake gets paid for his "analysis".

States are willing to go along thanks to Bill Clinton who "ended welfare as we know it", creating an even worse disability fraud scheme in the wake.

There has been no president since, Republican or Democrat, willing to stop fraud at the federal level. And clearly Obama is doing his best to expand fraud.

Disability Deal Explained

If Democrats give enough free benefits to enough people, no one can ever vote them out of office.

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

Stupidity of Negative Interest Rates Expands to Spain; Deflation Shock Thesis

Posted: 07 Apr 2015 01:23 PM PDT

Spain Joins the Negative Interest Rate Club

Reader Bran emailed a link this morning to an El Pais Article that showed interest on a 6-month treasury auction in Spain went negative.

Rather than translate, please consider the Wall Street Journal report Spain Joins Negative Yield Club.

Spain has joined the sub-zero debt club, just.

The Spanish Treasury on Tuesday issued short-term debt yielding a shade under 0%. The €725 million ($796 million) in six-month Spanish debt delivers an average yield to investors of -0.002%. Buyers were still keen, placing bids worth five times that amount, according to the Treasury.

Another slug of 12-month T-bills, also issued Tuesday, yields just 0.006%.

This is quite a turnaround for Spain. The country was at the heart of the eurozone debt crisis at its darkest hour. In June 2012, it sold similar short-term debt yielding 3.237%.

Negative Interest Rate Thesis

Ben Bernanke made the claim "In the weak (but recovering) economy of the past few years, all indications are that the equilibrium real interest rate has been exceptionally low, probably negative."

Quite frankly, that's idiotic.

In the absence of central bank monetary foolishness, negative interest rates cannot happen. I discussed that briefly in Thrown Under the Bus: Another Look at the Self-Serving Launch of Ben Bernanke's Blog and the Brookings Institute's Pandering Role.

Pater Tenebrarum's article Ben Bernanke's Apologia for the Fed that discusses why in detail, but a simple question is all it takes to prove the absurdity of it all.

Simple Question

Ask any person on the street, at random, if they would rather have a dollar today or 97 cents five years from today and they will probably look at you as if you were nuts for asking.

I believe the average 4th grader would understand the stupidity of the question. One would not even need a clear grasp on the subject of "time preference" to understand the absurdity of it all.

Heck, ask a 4-year old kid if he would rather have two lollipops today or one tomorrow. As long as the kid understands the question, I assure you he will know how to answer.

Natural Rate Can Never Be Negative

The "equilibrium" or "natural" rate can never be negative.

Interest rates are negative because central banks unleashed more money than anyone wants to borrow. Given deposit insurance only covers $250,000 and given money needs to find a home, depositors accept negative interest because they have no other choice. On top of that, the Swiss National Bank explicitly set deposit rates negative.

But the key reason rates are negative in many places is central banks use newly created money to buy bonds, and investors front run the trade. For further discussion, please see Another Definition of Deflation: Antal Fekete Defines Deflation as a "Pathological Slowing in the Velocity of Money".

The intention of the Fed (central banks in general) is to get businesses to invest and consumers to borrow. But what if businesses see little chance to make profits by expansion? What if credit-worthy customers do not want to borrow?

Deflation Shock Thesis

Central bank actions did not spur lending, so they buy more and more bonds, apparently under the theory "if it doesn't work, do more of it, until it does work". The ECB and Bank of Japan have taken over where the Fed left off.

Such idiocy has led to yet another asset bubble of enormous magnitude, in part fueled by corporations borrowing money at low rates to buy back their own shares at ridiculous prices.

When various bubbles in equities, junk bonds, and housing pop, the result will be an enormous deflation shock, the very deflation the central bank fools believe they are preventing.

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

Obama's Trans-Pacific Partnership Fiasco vs. Mish's Proposed Free Trade Alternative; How Will TPP Function in Practice?

Posted: 07 Apr 2015 11:06 AM PDT

Reader Richard asked me to comment on Obama's Trans-Pacific Partnership (TPP) proposal.

For starters, it's one complicated mess.

The Washington Post "Wonkblog" said in 2013 here's Everything You Need to Know About the Trans Pacific Partnership.

If you're just now hearing about the Trans-Pacific Partnership, don't worry: It's not too late to get up to speed. Negotiations over the huge trade agreement — which, when finished, will govern 40 percent of U.S.' imports and exports — were supposed to wrap up this past weekend in Singapore, but, well, they didn't quite make that deadline, which means meetings will likely continue into the new year.

The talks, as with all trade agreements, have been conducted largely in secret. Global health advocates, environmentalists, Internet activists and trade unions have deep concerns about what the deal might contain, and are making as much noise as possible in order to influence negotiations before a final version becomes public. Here's what you need to know.

1. What is the Trans-Pacific Partnership?

Basically, it's a giant free trade deal between the U.S., Canada, and 10 countries in the Asia-Pacific region that's been under negotiation for nearly a decade now (it began as an agreement between Singapore, Chile, New Zealand and Brunei before the U.S. took the lead in 2009). It's expected to eliminate tariffs on goods and services, tear down a host of non-tariff barriers and harmonize all sorts of regulations when it's finished early next year.

....

6. Wait, so how much does this thing actually cover?

The treaty has 29 chapters, dealing with everything from financial services to telecommunications to sanitary standards for food. Some parts of it have significant ramifications for countries' own legal regimes, such as the part about "regulatory coherence," which encourages countries to set up a mechanism like the U.S.' own Office of Information and Regulatory Affairs to conduct cost-benefit analyses on new rules. USTR has a rough outline, and for a more comprehensive rundown, read this Congressional Research Service report.

7. That doesn't tell me much. What are countries still fighting over?

Where to start? Most countries have their own individual issues, and it's difficult to tell what's been resolved since the details aren't public...

Reasons to Be Suspicious

Since the negotiations are secret, it's hard to say precisely what the agreement contains (and that alone is reason enough to be suspicious of it).

Nonetheless, many details have been leaked that give us serious concerns.

Bloated with Environmental Regulations

The Washington Post describe TPP as a "giant free trade deal".

Leaks and disclosures show the Washington Post is way off base with that description.

For example, the White House Blog says Environmental Advocates Point to the Trans-Pacific Partnership as a Historic Opportunity to Protect Our Oceans, Forests, and Wildlife.

Through TPP, the Obama administration is doubling down on its commitment to use every tool possible to address the most pressing environmental challenges. We aren't just talking about holding trading partners accountable for protecting wildlife, forests, and oceans; we plan to make those environmental commitments fully enforceable in the core of the TPP agreement, on equal footing with the economic obligations our trading partners take on.

That paragraph all but ensures the framework will include a mass of costly global warming nonsense. Even if one agrees with global warming agenda, it does not belong in a free trade agreement.

Why the Deal is Secret

On March 27, 2015, the Huffington Post proclaimed Now We Know Why Huge TPP Trade Deal Is Kept Secret From the Public.

A key section of the secret Trans-Pacific Partnership (TPP) trade agreement has been leaked to the public. The New York Times has a major story on the contents of the leaked chapter, and it's as bad as many of us feared.

Now we know why the corporations and the Obama administration want the TPP, a huge "trade" agreement being negotiated between the United States and 11 other countries, kept secret from the public until it's too late to stop it.

The section of the TPP that has leaked is the "Investment" chapter that includes investor-state dispute settlement (ISDS) clauses. WikiLeaks has the text and analysis, and the Times has the story, in "Trans-Pacific Partnership Seen as Door for Foreign Suits Against U.S.".

The WikiLeaks analysis explains that this lets firms "sue" governments to obtain taxpayer compensation for loss of "expected future profits."

Let that sink in for a moment: "[C]ompanies and investors would be empowered to challenge regulations, rules, government actions and court rulings -- federal, state or local -- before tribunals...." And they can collect not just for lost property or seized assets; they can collect if laws or regulations interfere with these giant companies' ability to collect what they claim are "expected future profits."

The Corporate Influence Over the TPP

Largely ignored by the media -- until now -- the TPP has been in a negotiation process for more than five years. The TPP has 29 "chapters" covering various issues, but only five of these chapters cover what would normally be considered "trade".

These negotiations have been conducted in secret, but more than 500 corporate "trade advisors" have access to the text of the agreement. Many of the negotiators themselves are past (and/or likely expect to be future) corporate attorneys or executives. U.S. Trade Representative Michael Froman, for example, "received over $4 million as part of multiple exit payments when he left Citigroup to join the Obama administration," according to a report, "Obama Admin's TPP Trade Officials Received Hefty Bonuses From Big Banks," by investigative journalist Lee Fang.

Only 5 of 29 Chapters Covers Trade

We have had five years of secret backdoor discussions on trade. The resultant document has 29 chapters of which only 5 are about trade.

It's highly unlikely those 5 chapters have much to do with "free trade".

TPP Opens Door for Foreign Suits Against U.S.

The New York Times says Trans-Pacific Partnership Seen as Door for Foreign Suits Against U.S..

An ambitious 12-nation trade accord pushed by President Obama would allow foreign corporations to sue the United States government for actions that undermine their investment "expectations" and hurt their business, according to a classified document.

The Trans-Pacific Partnership — a cornerstone of Mr. Obama's remaining economic agenda — would grant broad powers to multinational companies operating in North America, South America and Asia. Under the accord, still under negotiation but nearing completion, companies and investors would be empowered to challenge regulations, rules, government actions and court rulings — federal, state or local — before tribunals organized under the World Bank or the United Nations.

Supranational Court

Julian Assange, WikiLeaks editor said: "The TPP has developed in secret an unaccountable supranational court for multinationals to sue states. This system is a challenge to parliamentary and judicial sovereignty. Similar tribunals have already been shown to chill the adoption of sane environmental protection, public health and public transport policies."

New TPP World

Image courtesy of Wikileaks.

Free Trade Blocks

Traditionally, the biggest blocks to global free trade deals have been the US and EU, and agricultural tariffs are often at the heart of the issue.

The US typically says something to the effect of "we will agree to eliminate agricultural tariffs if the EU does", and of course France will never agree to let the EU do any such thing.

Mish's Proposed Free Trade Agreement

To call TPP a "free trade" agreement is ridiculous.

I am in favor of free trade. An excellent free trade agreement would consist of precisely one line of text. I propose the following agreement:

"All tariffs and all government subsidies on all goods and services will be eliminated effective June 1, 2015."

Pick your own starting date, including "immediately" if you like. Let the wrangling on all the other stuff take place elsewhere. Trade discussions ought to be about trade. History shows that alone is hard enough.

Notice that I did not mention "fair trade". The only "fair trade" is "free trade" whether or not any other country reciprocates or not.

Lead by Doing, Not Talking

I firmly believe the first county that fully embraces free trade would come out ahead, regardless of whether or not any other country reciprocates.

From that standpoint, there is no need for discussion at all. The US could and should set the model for the world simply by ending tariffs and subsidies on its own accord.

How TPP Will Function in Practice?

If this damn thing passes as is, TPP will create an "unaccountable supranational court for multinationals to sue states", precisely what one might expect after five years of secret backroom deals led by Obama.

Here's how it will work.

Obama crammed down a bunch of global warming regulations. To get companies to go along, Obama concocted a supranational tribunal court that would allow every company to sue for lost revenue due to those regulations.

Taxpayers will lose three ways: first on needless regulations, second on corporate handouts to pay for grievances, third for having to pony up for the creation of the new supranational court.

I can smell boondoggles, and this one is massive.

Why Five Years?

Q. Why did the deal take five years to put together?

Obama had to win over every global warming group, no matter how extreme.
Obama also had to include language for the explicit benefit of companies like GE that actively promote solutions that only "work" with huge government subsidies. GE's mission was to ensure subsidies would be big enough to make a fat profit no matter what happened down the line.
Obama also had to appease companies that stand to lose from the hype. To get those companies on board, he had to create a supranational tribunal court.
To get the lawyers on board, he needed their approval of the tribunal formulation and process.
To get the Congressional ducks lined up, each sensitive group was shown only those things that were in their favor, while hiding everything else.

Open Mind

I have an open mind about this. There is a slim chance I have it wrong. The way to prove me wrong is to release the full and complete text of the deal for the public to scrutinize.

My fear is this will be another one of those things "you have to pass to find out what's in it".

No thanks.

Alternative Proposal

I submit my one sentence alternative a second time: "All tariffs and all government subsidies on all goods and services will be eliminated effective June 1, 2015."

That's what free trade is really about, whether or not I am off base on some of my suspicions listed above.

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

Damn Cool Pics

Abortion: What You Need to Know [Infographic]
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Abortion: What You Need to Know [Infographic]

Posted: 07 Apr 2015 12:36 PM PDT

This infographic highlights some really interesting facts and figures about abortion in US, types of abortion and quotes on abortion from famous personalities.

Click on Image to Enlarge.

via CBR

Award Winning Photos That Were Taken With A Mobile Phone

Posted: 07 Apr 2015 11:27 AM PDT

These are the winners of the Sony World Photography Awards 2015 in the category of "Mobile Photo." It just goes to show how far technology has come when you can take photos that look as good as these ones on a handheld device.

This Girl Is A Real Life Cheetah Whisperer

Posted: 07 Apr 2015 10:47 AM PDT

This is Heather, she took her first trip to South Africa in 2011 and quickly befriended a cheetah named Dew. Now she tries to visit him regularly and they have a great friendship. Their relationship gives you a look at the softer side of wild animals.