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Schema.org - A New Approach to Structured Data for SEO Posted: 02 Jun 2011 05:48 PM PDT Posted by richardbaxterseo Just every now and again, search engines love to throw our merry band of SEO types the occasional curveball and keep us on our toes with new toys and updates. Yesterday was one such day for the world of structured data in web page design. What’s structured data? Unless you’ve been living under a rock for the past two years, you’ll be all over “rich snippets” – those fabulous little search results that help you stand out from the crowd in your organic rankings. Structured data added to web pages helps search engines parse your data into different types of search results, like recipe search. Review ratings, events, recipes, company names, contact name, job titles and even friend connections on Facebook have at some stage been visible in the search results for “white listed” web sites. Making the right choice on the use of markup In Google’s words, “adding markup is much harder if every search engine asks for data in a different way.” – this is so true. For webmasters making the difficult decision on which markup to choose has been quite a hurdle. The simplicity of Microformats over the depth and creativity of RDFa, or the HTML5 working group approved Microdata? What about the RDF/XML based Goodrelations for ecommerce? It seems the search engines have made that choice for us by introducing a new, standardised collaboration called schema.org. More choices for more entities Solving the problem of inconsistent options for structured data markup, schema.org gets on with the task of opening up a bunch of new entities for webmasters to describe in their web pages. Schemas for movies, music, restaurants, local business, TV series and “intangibles” such as offers are all in the new vocabulary. If you’ve got a website with any of the types of data described by the new schemas, you should get excited! Check out their full list – it’s incredibly extensive. How does schema.org work? Schema.org is based on Microdata. In simple terms, each type of data or entity can be described by a vocabulary. Vocabularies for an entity are described on the appropriate page at schema.org, so, for example, if you’ve got a music listing on your webpage, you’ll just need to reference the Music Recording vocabulary at Schema.org. To implement schema.org’s vocabularies, you only need to understand the attributes: itemscope, itemtype, itemprop and you’ll need to have the URL of the vocabulary to hand. The instructions for basic implementation can be found on the getting started page at schema.org – let’s look at the basic elements: Which would produce: Richard Baxter CEO SEOgadget.co.uk In this very simple example, I’m using the “itemscope” attribute to declare that the following html contains data about something. That something, “itemtype”, is a person (me!). Each property, my name, picture, job title can be found in the vocabulary at schema.org. Declaring the appropriate scheme might allow a search engine to parse the data and use it for a rich snippet or maybe a people search engine? But I implemented microformats / RDFa – now what? You’re not the only one – we’re all in the same boat. The simple answer is, search engines are great at getting us to accept their standards. At some point we’ll all be using schema.org to structure our data. If you’re already on the Google rich snippets white list, don’t panic. Google will continue to support existing structured data formats for the foreseeable future. If you’ve got the development resource, or you’re in the process of a site redesign, then migrating to the appropriate schema.org vocabulary shouldn’t be too much of a challenge for a capable web developer. More options and more types of search For me, this is an exciting play from the search engines. They’re working to simplify the problem for webmasters of knowing which markup to choose and at the same time, offering more options for types of data to be structured. The really big deal, for me, is Bing’s entrance into the rich snippets arena. Their support for rich snippets until now has been lacklustre at best. Hopefully, with a standardised approach, we’ll be able to get the same rich snippets from all 3 engines. Google recipe search was the first “mainstream” structured data search engine. I can’t help but think that with greater proliferation of a standard approach to structured data, we’ll see more services like recipe search from the engines soon.   Do you like this post? Yes No

Project Management Tips for Marketing Teams - Whiteboard Friday Posted: 02 Jun 2011 02:08 PM PDT Posted by Aaron Wheeler  Time management is one of the toughest parts of any job, but in web marketing, it's impossible to do your job if you can't manage your projects. Since web marketers are wearers of many hats, it's helpful to collaborate, regroup, and organize often enough to keep on top of things. In this week's Whiteboard Friday, Tom Critchlow from Distilled and SEOmoz's VP of Marketing, Jamie, discuss some ways we maintain control here at SEOmoz and how you can adopt parts of our marketing team's project management methods in your own practice. Have a great project management tip? Let us know in the comments!   A Photo of Marketing Project Whiteboard   A few notes: we use the larger Super Sticky Post-It in four colors, which represents a few different areas of focus SEO/Site, Social/Community, Performance, and Marcomm.  We have colored magnets which represent different things like "Requires Development", "Requires Design", "Waiting For Someone Else". Video Transcription Tom: Howdy, SEOmoz. Welcome to another edition of Whiteboard Friday. This is Jamie. Jamie: This is Tom. Tom: And today we're going to talk a little bit about the SEO project management system. I came over from Distilled, and I have implanted some of the ways that we do things at Distilled, and between us, we've come up with this kind of way of managing projects, managing tasks across the marketing team, and we thought we'd share with you a little bit about how it works. So, Jamie, what are we looking at here? Jamie: So, what we've done is we have taken every team member and created a column for them on the whiteboard. Now, just for the purposes of this Whiteboard Friday, we've got just the two of us. The idea is that we have these Post-it notes that represent projects or outcomes of things that we're all working on. The idea here is that we have this line. If a project is above the line, that is a project I am going to be focusing on today, that particular day. Things below the line are things that we would consider to be in sort of a holding pattern. Maybe you're waiting for somebody to get started on this. Maybe it's the next thing that you're going to work on. Tom: So, you can really quickly and easily see everything that's on my to- do list now broken down by what I am directly working on now, either like today or tomorrow, but also stuff that I'm waiting on other people. This is like end of the week, next week, further out. These are just kind of like they don't have a specified date, but this stuff is the stuff that I am working on like right here and now. Jamie: Yeah. I will say though I think one thing that we've tried to do here is keep this simple and not necessarily have these be the most atomic or the smallest task. But instead be some sort of measurable outcome. So, for example shoot Whiteboard Friday, when I am done shooting Whiteboard Friday, I'll be done with this. I'll take it from here and I'll put it into a different column, which is accomplishments or achievements. The idea is that by the end of the week this should be filled up with between 10 and 30 different Post-it notes of the progress that you've made that week. But I think the clear distinction that we've made is that everyone has their own sort of project management system that they use. I use the software for my Mac. You use I believe . . Tom: I use Remember the Milk. Jamie: Some people use notepads next to their desk. But this, for example, may have ten different tasks that I go through, but the team really only needs to see this. So that's what we've tried to do here by making these certain size projects. So, what is the right size of a project to go up on this board would you say? Tom: I think basically any project that goes up on the board here should be a sizable chunk of work that has, like you were saying, a defined outcome. So anything really that's like maybe less than an hour's work or isn't going to be that measurable or impactful. Like, I'm not going to put on here a meeting with somebody necessarily. That's not something that is particularly important for the team to know that I am working on. But it is useful for the current defined output. So rewriting copy for a new page on the website, that's like a task that is going to take me some time. Everyone else might want to know when that's done, when I'm working on it. That leads into, I think, one of the powerful things of this system is really the simple, the ease with which you can see what everyone else is working on. It's like everyone on the team can see what everyone else has on their plates, see what they're not working on, and see what they're working on and adjust their schedules accordingly. So, for example, let's say that you have this task here for wireframing category pages. Jamie: Actually, I moved it up here. Tom: Lets' say this is top of your list. I can be like, "Oh, so I see this is important. So I should probably move up the copy for the category pages on my to-do list." I can just move stuff around like this really quickly and easily. That's the power, and it is not too restrictive. There aren't too many rules going on here. But it gives us a really quick and easy way of seeing what's going on. But the whiteboard is only one part of the project management system. We also have these daily stand-ups where we have the whole marketing team. We come together for like maybe no more than 10 to 15 minutes. Do you want to talk us through that, Jamie? Jamie: Yeah, sure. So, every morning at 10:00 a.m., that's the time that we chose, and it may be different for your organization. Tom: Well, we're lazy here at SEOmoz. So 10:00 a.m. feels like a nice. gentle . . . Jamie: I would say it's between 3 and 10 minutes. Tom: Yeah. Jamie: It really depends. But really what we do is each person just does a quick once over of what's on their roadmap or their radar so to speak. So, if this was the stand-up right now, I would say, "Well, today I am going to work on the wireframe for the category pages." As soon as I am done with that, then it will go off to you so you can work on the copy. So that's why Tom would probably move that up there or consider doing that. Then, I'm going to say, "I am going to work on the presentation for SMX Advance and that will probably take me a day or two." So that will be kind of the two things on my roadmap. Then, I might say, "Something I have on deck is to shave." If you're going to do Whiteboard Friday, it's actually probably not a bad idea to shave before you do it. So that's why I have that next on deck. Then Tom, you would kind of go through your projects in the same manner. Tom: Yeah, absolutely. By doing this, like it's really important that the whole team then gets a sense of what we're all working on. It's really quick. It doesn't take anyone's time too much, but we all get that top-level visibility, which I think is really important for a team, particularly for the marketing team where we might be working on a whole range of disjointed tasks. Some of it is something to do with the website, some of it is to do with emails, some of it is the affiliate program. We don't all need to know the nitty-gritty of all those different projects, but it is useful for us to just understand broadly what we're working on and when those things are achieved. Jamie: And what those outcomes are. Tom: Exactly. Jamie: I think some other things that we get in that daily stand-up processes are help. So, if I throw this up and I talk about it in stand-up, Tom might say, "Oh, let me help you with that. I've got some time today." So it really helps you to help each other. It also helps you to provide feedback. So, if Tom puts this up, I or someone else on the team might say, "I don't know if that's the most important thing. I don't know if we need that this week." So he might swap these. Tom: Yeah. Jamie: It's something that we do throughout the day, in fact. Not only do we move things in stand-ups, but you'll notice people walk up during the day and they move things around. They take things that are completed and they move them over. Tom: Yeah. Yeah. Jamie: Talk to me a little bit about the line and where you think it should be, because it's something that we've played with a little bit. Tom: Yeah. I don't know if we have this perfectly working in our system at the moment. But I think that this line really, it's kind of a line in the sand to try and differentiate between what tasks I am actively working on right now versus tasks that are just like, eh, someday, when I get around to them. Or maybe it's important but I am waiting on somebody else for something. And I think that we've tried to play around with keeping these tasks just stuff I am working on today, but I think it works a bit more broadly like today you stroke the next few days. The top of mind is things that I am actively thinking about and working on now. Because there are loads of subtasks involved with these, you might end up working on a whole bunch of things at once. Right? Jamie: Yeah. Tom: You don't just single focus and go for a whole day I am just doing this task. You kind of work on bits and pieces here. You maybe send something off to somebody and you wait for feedback. There has to be a room for a few different projects or a few different tasks going on at once. But I think the idea being that having this line . . . we tried it without the line to start with. It didn't work so well. But having a line really separates, mentally primarily, like what's really active right now and what's not active. Jamie: I see this sort of in focus and out of focus. I think we did, we did play with the line. I think different organizations are going to have a different point where the line makes sense. But we've sort of gotten to the point where the lines is, if the number of projects you have above the line is crowded, like they don't fit, that's probably not going to be a successful day. You're not going to be successful at touching all of those things. I think ours can fit about four. Most days, most of us have two or three above the line. I don't know if we mentioned this idea that whatever is closest to your name is sort of the highest focus, if that makes sense. Below the line we sort of similarly use the same sort of prioritization, but it is very simple. It is very easy to move things around by just saying, "Oh, this has been delayed, so I am going to do that." So that folks can kind of see what may be up next on your plate. Tom: Yeah. This has been working pretty well for us the last couple of weeks. I think the team really appreciates having the stand-ups especially. Getting that high-level view across everyone else's projects I think is really valuable, but also I think it's really important for the whole company. We have this whiteboard behind the marketing team. It has everyone's tasks on it. It is very colorful. Anyone who walks by, like Rand can walk by, anyone from the exec team can walk by, and they can just instantly see, oh, what is the marketing team working on right now? Jamie: Yeah. It's right here. Tom: What's in the queue? Jamie: What have they recently accomplished? Tom: I think this achievement section is really that kind of positive reinforcement for like, "Oh, we're achieving loads of stuff at the moment." This is good. Jamie: Yeah. Tom: Keep that momentum going. That's one of the big differences I've found coming from agency to kind of an in-house role is you guys don't really have that kind of external motivator so much. It's not like there is a client on your back hounding you all the time to like get this done, get those done, or I need a report or whatever. You are your own bosses. Jamie: We need to choose what we work on. Tom: Exactly. Jamie: And this helps us do that. Because as a team, we're able to say, "I'm working on this week," and someone else can say, "Oh, this is a supporting project. Let me help you out with that." Tom: Yeah. And there have been a few times in the stand-up where everyone will go through all their tasks, and then somebody will put their hand up and be like, wait, what, who is owning X? Like some . . . Jamie: We'll literally do this. We'll put the project on a thing and, you know, I will. Tom: And that's great. Everyone feels like someone's got ownership of it. We don't forget the task. There isn't that situation where everyone goes, oh, I thought that you were working on it. Oh, I thought you were working on it. Then it falls through the cracks. So it feels quite simple, but it is actually a surprisingly powerful way of managing projects and tasks, and that visibility, I think that communication between the team is really key to making it work. Jamie: Yeah. I think two other things that we've done that have been sort of interesting is that we take the achievements from a given week, so first thing Monday morning, we take all the achievements from last week and we put them somewhere else. What we do is we've been drawing a box around it and then writing the week. So we can actually see these boxes that have 20 or 30 of these in them, and not only does it help us say, what did we do two weeks ago, but it helps us see that progress and what we have actually noticed is that there have been more Post-its each week. Tom: Absolutely. Yeah. Jamie: We've been doing more each and every week. I think it's not just because we've been doing smaller things. I think that we have become more efficient as a team. Tom: Yeah, absolutely. Absolutely. Jamie: Then we also have these little magnets that we've been using a little bit. These are sort of an optional thing, but what we meant to do is that we have some projects that involve our development team and some projects that involve our engineering team. So we have a few different colors of these magnets, and it allows someone from our engineering team or from our design team to walk up to the board and say, "Oh, that's a project that's going to require some help from my team." It gives them a visibility on what projects are going to need their help. So it's a way that we signal to other teams in the company that those are projects that need their help. Tom: Again, internally in the team, if we have a whole bunch of tasks here that all require development, we can decide to deprioritize some of those because we know we aren't going to get all of them done straightaway. Jamie: Yeah. We'll look and say, "Oh, jeez, we have way too many development projects. This one is not important. It's going below the fold." Tom: Absolutely. Yeah. Jamie: Cool. Tom: Awesome. Thanks guys. I hope that was helpful. We'll post some photos in the blog post down below, as well, of the real whiteboard. This is just a dummy one for the Whiteboard Friday. I'd love to know how do you guys manage your projects. I'd love to hear in the comments as well. Jamie: Yeah. And how do you think we could improve this? Because it's just something that we sort of came up with over the last few months. Tom: Absolutely. Jamie: Great. Thanks a lot. Tom: Thanks. Video transcription by SpeechPad.com Do you like this post? Yes No

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Infographic: The Resurgence of the American Automotive Industry

Your Daily Snapshot for Friday, June 3, 2011   Infographic: The Resurgence of the American Automotive Industry Today, President Obama will travel to Toledo, Ohio where he will visit the Chrysler Group’s Toledo Supplier Park – an operation that employs more than 1,700 workers producing Jeep Wranglers, Jeep Liberties, and Dodge Nitros. Earlier this week, the National Economic Council released a new report on the resurgence of the American automotive industry. Over the past two years, the auto industry has added 113,000 jobs - the fastest pace of job growth in the auto industry since 1998.  View the infographic highlighting some of the key successes in the auto industry since 2009. West Wing Week: "One Step at a Time"  This week, President Obama traveled to Joplin, Missouri in the wake of historic and deadly tornadoes to see the devastation first hand. The President finished his week-long trip to Europe in Poland and visited Arlington National Cemetery on Memorial Day.  Watch the video  In Case You Missed It Here are some of the top stories from the White House blog. Ensuring Technology is Accessible for All Students The U.S. Department of Education takes steps to better serve the needs of students with disabilities by encouraging schools to improve their learning models and include emerging technologies in their daily lessons. Unleashing Rooftop Solar Energy through More Efficient Government The Department of Energy launches a competition between local governments to streamline administrative processes for the installation of solar energy systems in homes and businesses. Youth Roundtable Spotlight: Detroit Area Young People Make Their Voices Heard The White House wraps up "100 Youth Roundtables” initiative and highlights some of the conversations and solutions that young people have undertaken around the country.  Today's Schedule  All times are Eastern Daylight Time (EDT). 9:30 AM: The President receives the Presidential Daily Briefing 9:55 AM: The President departs the White House en route to Andrews Air Force Base 10:10 AM: The President departs Andrews Air Force Base en route to Toledo, Ohio 11:30 AM: The President arrives in Toledo, Ohio 1:00 PM: The President tours Chrysler Group Toledo Supplier Park  1:25 PM: The President delivers remarks to workers  4:00 PM: The President departs Toledo, Ohio en route to Andrews Air Force Base 5:15 PM: The President Arrives at Andrews Air Force Base 5:30 PM: The President Arrives at the White House    Indicates events that will be live streamed on WhiteHouse.gov/Live Get Updates  Sign Up for the Daily Snapshot  Stay Connected     Facebook Twitter YouTube Flickr iTunes         This email was sent to e0nstar1.blog@gmail.com Manage Subscriptions for e0nstar1.blog@gmail.com Sign Up for Updates from the White House Unsubscribe e0nstar1.blog@gmail.com | Privacy Policy Please do not reply to this email. Contact the White House The White House • 1600 Pennsylvania Ave NW • Washington, DC 20500 • 202-456-1111

What Are You Doing To Earn Facebook Likes and Facebook Fans Graywolf's SEO Blog

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What Are You Doing To Earn Facebook Likes and Facebook Fans Posted: 02 Jun 2011 10:12 AM PDT It seems everyone in social media and SEO is obsessed with Facebook now. Getting Facebook fans and Facebook likes may have even eclipsed link buying as the new black hat way of gaming the system … So what are you doing to get Facebook likes? Before we talk about getting likes, let’s take a step back and look at what are some of the benefits of getting fans and likes? SEOMoz recently published a study showing a correlation between getting liked on Facebook and improving your rankings. PracticalEcommerce published a post with some monetary values for getting liked on Facebook. On average, Fans spend an extra $71.84 they would not otherwise spend on products they describe themselves as Fans of. Fans are 28 percent more likely than non-Fans to continue using a specific brand. Fans are 41 percent more likely than non-Fans to recommend a product. SocialMedia Explorer and the DailyBeast published information on Edgerank, and how it’s important if you want the likes and shares of your fans to be seen by their friends, increasing your exposure. I’ve written before about how social signals are part of the algorithm and are likely to become a bigger part in the near future. So, back to the question at hand … What Are You Doing to Get Facebook Likes? On average, Fans spend an extra $71.84 they would not otherwise spend on products they describe themselves as Fans of… At the time of this post’s writing, Facebook has some rules about contests and flagrant liking schemes that incentivize the fan/ like process but, to be honest, it’s pretty easy to work around. So take advantage of the lawless wild west atmosphere while it exists, but realize it’s a short term loophole, so fake it till you make it. As a long term solution, there are better options to getting Facebook fans and likes. It’s similar to twitter. If you want 50,000 followers, you need to do 5,000 interesting things that will each get you 10 new fans. But, enough theory. What are some concrete things you can do: Coupons, promotions and giveaways – Numerous studies have shown the number one reason people become fans is for a discount. Solve problems – If you aren’t giving a discount, solve a problem. Saving someone time or money is huge. Educate or Inform – Teach people something with a how to article. Again, create a benefit to being a fan. Research – Can you create a white paper or e-book to help people make more informed decisions about purchasing your product or service or about your overall niche? Entertainment – Sometimes it’s just about making people smile or laugh. While lots of people will tell you social media is about community and participation, you can use it as a broadcast tool too, as long as you create some sort of value add for the people on the opposite end. Just remember that it has to be something they value, not you. photo credit: Photospin Related posts: Your Facebook Fan Page – 5 Ways to Make the Most of It If your business targets consumers, do you already have a... Facebook vs Twitter: Which is More Valuable? Recently there has been a lot of talk about Facebook... Don’t Put All Your Eggs in the Facebook Basket While Facebook may be a hot marketing tool right now,... How Small and Local Businesses Can Use Facebook If there’s one aspect of social media that mainstream press... Really Facebook You Still Don’t Get it Do You C’mon Facebook I really thought we had moved past this... Advertisers: Text Link Ads - New customers can get $100 in free text links. BOTW.org - Get a premier listing in the internet's oldest directory. Ezilon.com Regional Directory - Check to see if your website is listed! Need an SEO Audit for your website, look at my SEO Consulting Services Link Building- Backlink Build offers 45 PR5+ Backlinks for $295 Directory Journal - Get permanent deep links in a search engine friendly directory LinkWheel SEO - Get Web 2.0 Backlinks Links From PR9 Sites - - Get In Top 3 Google ASAP TigerTech - Great Web Hosting service at a great price. This post originally came from Michael Gray who is an SEO Consultant. Be sure not to miss the Thesis Wordpress Theme review. What Are You Doing To Earn Facebook Likes and Facebook Fans

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Mish's Global Economic Trend Analysis

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• Trichet Calls for Creation of European "Nanny-State" and Fiscal "Nanny-Zone"
• Inane Department of Education Ruling Sends Education Stocks Flying
• US Factory Orders Drop 1.2%, Durable Goods Orders Drop 3.6%, 67 out of 67 Economists Overoptimistic
• Superb Russell Napier Interview on Financial Sense; Will the S&P Drop to 400 as Napier Suggests? Why it Might Not

Trichet Calls for Creation of European "Nanny-State" and Fiscal "Nanny-Zone" Posted: 02 Jun 2011 02:06 PM PDT Rather than admit the innumerable mistakes has has made, ECB president Jean-Claude Trichet has continually upped the ante on taxpayers with increasingly risky measures such as loading up the ECB with junk bonds from Greece and Ireland in clear violation of the Maastricht Treaty. Today, in the wake of still more failures of the bond market to follow his wishes, Trichet openly calls for a bold new initiative, one that would effectively transform the Euro-Zone, into a fiscal Nanny-Zone as well. Creation of the "Nanny State" Bloomberg reports Trichet Calls for Euro Finance Ministry as Crisis Deepens European Central Bank President Jean- Claude Trichet said governments should consider setting up a finance ministry for the 17-nation euro region as the bloc struggles to contain a region-wide sovereign debt crisis. "Would it be too bold, in the economic field, with a single market, a single currency and a single central bank, to envisage a ministry of finance of the union?" Trichet said in a speech today in Aachen, Germany. He also favors giving the European Union powers to veto the budget measures of countries that go "harmfully astray," though that would require a change to EU Treaties. Trichet, who has no formal power over government decision making, hasn't said what he plans to do when he leaves the ECB at the end of October. He said today that while any single finance ministry would "not necessarily" administer "a large federal budget," it would "exert direct responsibilities in at least three domains." These would include "first, the surveillance of both fiscal policies and competitiveness policies" and "direct responsibilities" for countries in fiscal distress, he said. It would also carry out "all the typical responsibilities of the executive branches as regards the union's integrated financial sector, so as to accompany the full integration of financial services, and third, the representation of the union confederation in international financial institutions." Trichet said that any new form of fiscal governance would need to be "decided by the people of Europe" and that the EU president, the European Commission and the German finance ministry are sure to have their own views. Calls to the German finance ministry for comments on Trichet's proposals were not immediately returned. Officials at the French finance ministry declined to comment. This was bound to happen given the flaws in the creation of the Euro itself. Who is the best person to head up the nanny-state? Why it's none other than Jean-Claude Trichet, soon to be out of his job as ECB president because of term limit restrictions. Flashback December 17, 2010: Support Rises for "European Nanny State"; Is Germany unfit for the Euro or is the Euro Unfit for the PIIGS? Angela Merkel's Big Mistake Merkel's big mistake was caving in to Trichet, Noyer, and others who insisted on "no haircuts". For that, she is now the subject of "The Big Point" with everyone jumping on her back and pointing fingers. Consider this statement from the EuroIntelligence article: The Left Party's spokeswoman said Merkel's position did not reflect the national interest but those of the banks (a position with which we would agree. Merkel is extraordinarily lazy in the definition of what constitutes the national interest.) European Nanny State My initial reaction was "It would seem that Merkel stood up FOR Germany and against the banks when she insisted on haircuts." Just to be safe, I emailed my friend "HB" who lives in Germany, asking for his thoughts. His reply was "I completely agree with your interpretation." He went on to comment about a reference in the EuroIntelligence article citing Der Spiegel's online editorial "Union of the Unreconciled" calling for the coordination of all aspects of economic policy, includes taxes, wages, and pensions. My friend "HB" commented This is what the fools that rule the Eurocracy want - a huge centralized nanny state in which taxes are 'harmonized' and citizens can no longer choose between low and high tax nations. It is the absolutely worst thing that could possibly happen. It would be better for the euro-area to break up. Fiscal Nanny-Zone Trichet was one of the architects of the Maastricht Treaty, and he has violated that treaty at will ever since. Now he wants to completely trash the treaty, effectively transforming the Euro-Zone into a nanny-zone "Eurocracy". When will Germany finally step up to the plate and tell Jean-Claude Trichet in no unmistakable terms where to shove it? 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.

Inane Department of Education Ruling Sends Education Stocks Flying Posted: 02 Jun 2011 10:31 AM PDT The only thing student loan programs do is saddle students with debt and pad the pockets of educators, especially for profit colleges. Students are defaulting in record numbers. Worse yet Yahoo Finance reports that students at for-profit institutions represent just 12 percent of all higher education students but 46 percent of all student loan dollars in default. Please see Big student debt could limit schools' aid access for details. The government solution is to ban federal aid programs for profit colleges unless a minimum of 35 percent of its former students are repaying their loans. 35 Percent Effective Is OK??!! Secretary of Education Arne Duncan said "We're asking companies that get up to 90 percent of their profits from taxpayer dollars to be at least 35 percent effective. This is a perfectly reasonable bar and one that every for-profit program should be able to reach." 35 Percent is NOT a "perfectly reasonable bar". However it certainly is a bar that "every for-profit program should be able to reach." Yet, amazingly, the DOE said it expects 18 percent of for-profit schools' programs to fail its tests at some point, and 5 percent of programs to lose eligibility under the new law. 69% is flunking, 35% is preposterous. Education Stocks Rip Roaring On that inane ruling by Secretary of Education Arne Duncan, Education Stocks Rally 15 Percent. Education stocks were the top gainers on U.S. exchanges on Thursday. Shares of Corinthian Colleges, up almost 40 percent, were the most heavily traded on Nasdaq. Market leader Apollo Group rose 15 percent, while stocks of Strayer Education, ITT Educational and Education Management rose more than 20 percent. An education index was up 15 percent. Analysts said the new rule benefited all companies in the sector. Companies like Apollo and Capella Education, which were in the restricted zone to access federal aid based on the repayment rate metric, can now grow their student base unrestricted. The education department surprised with the number of changes that benefited the colleges, given its tough stance on the issue in the last two years. A key change in the rule is that colleges have now till 2015 before a program can be denied tuition loans over too many defaults by ex-students. The rule is part of the Obama administration's crackdown on for-profit schools, accused of overcharging students, burdening them with debt and not preparing them adequately for jobs. The department finalized a set of 13 rules last year but delayed the 'gainful employment' rule after much opposition. Crackdown by Obama? What Crackdown? The abuses are staggering as is the burden on students who graduate collage hundreds of thousands of dollars in debt, with useless degrees in English or culinary arts. In regards to the latter, for-profit colleges include burger-flipping as getting a degree in the field. Obama brags about safeguarding student loans. That is like bragging about safeguarding the plague. Student loans have done four things, all of them bad. Jack up the cost of education Make students debt slaves for the rest of their lives Unjustly hand over huge profits to schools like the University of Phoenix at taxpayer expense Add to the national debt The best thing to do with student loans would be scrap the program entirely. Please consider Education Bubble: The "Education Bubble"; Student Loan Debt Passes Credit Card Debt, Expected to Hit $1 Trillion A Remarkable Comparison: Affordable Student Loans vs. Affordable Housing an email from Eugene Holloway, a Maryland Attorney, on the rising cost of college education. Debt for Diploma Schemes: Debt for Diploma Schemes and the Cookie Monster Principle Off-Balance-Sheet Budget Fraud: Budget Deficit Accounting Fraud and the Off-Balance-Sheet Student Loan Scam; Time to Scrap Entire Student Loan Program Pell Grants Turn Students into Debt Zombies: For Profit Schools Turn Students Into Debt Zombies; It's Time To Kill The Entire Pell Grant Program Subprime College Loans, Who is to Blame?: Subprime Goes to College; Students Buried in Debt; Who is to Blame? Expect More Student Riots: University of California Campus Erupts In Riots; Student Loan Scam Drives Up Cost Of Education; Expect More Riots Reflections on a Wise College Major Student Loan Projections 2009-2020 in $Billions Scalpel and Machete Both Wrong We do not need to take a Scalpel or a Machete to the student loan program. The student loan program should be scrapped in entirety. Indeed there are entire departments that should be scrapped entirely, including the department of education and department of energy. 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.

US Factory Orders Drop 1.2%, Durable Goods Orders Drop 3.6%, 67 out of 67 Economists Overoptimistic Posted: 02 Jun 2011 09:08 AM PDT Add durable goods to the ever-growing pile of stats that suggest the economic growth is slowing rapidly, assuming of course there is any growth at all. The growth everyone is trumping up is in reality a mirage as noted in the excellent column this morning Can We Please Stop Pretending the GDP Is "Growing"? by Charles Hughes Smith. The Federal government borrowed and spent $5.1 trillion over the past four years to generate a cumulative $700 billion increase in the nation's GDP. That means we've borrowed and spent $7.28 for every $1 of nominal "growth" in GDP. In constant dollars, GDP is flat: we got no growth at all for our $5.1 trillion: zip, zero, nada. In constant dollars, the GDP in 2011 might return to the 2007 level, if the economy continues "growing" at the same pace reached in the first three months of 2011. If not, then the GDP will actually be lower than pre-recession levels. If you borrowed $7 to get $1 in your pocket, would that strike you as a good deal?How long do you reckon you could borrow $7 to get $1 of "growth" in your finances? US Factory Orders Drop 1.2%, Durable Goods Orders Drop 3.6% Bloomberg reports U.S. Factory Orders Fell 1.2% in April, Most Since May 2010 Orders placed with U.S. factories fell in April by the most in almost a year as demand for aircraft waned and Japan's earthquake restrained auto-related supplies. Bookings for manufacturers' goods dropped 1.2 percent, the biggest decrease since May 2010, after a revised 3.8 percent gain in March, figures from the Commerce Department showed today in Washington. Economists projected a 1 percent decline in April, according to the median forecast in a Bloomberg News survey. Orders for durable goods fell 3.6 percent. Estimates of the 67 economists surveyed by Bloomberg ranged from a decline of 3 percent to a gain of 1.5 percent. Orders for capital goods excluding aircraft and military equipment, a measure of future business investment, fell 2.3 percent, the most since January. March capital goods orders rose 5.4 percent. Jobless claims decreased by 6,000 to 422,000 in the week ended May 28, according to Labor Department figures released today. Economists had predicted a drop to 417,000. Tokyo-based Honda said its North American and China vehicle production will return to pre-earthquake levels in August. In the U.S., production of Honda's Civic small cars will continue to be slowed by limited supplies of some parts, the Tokyo-based company said in a statement May 26. Production of the 2012 Civic, which went on sale in April, will be at about 50 percent, it said. "The light at the end of the tunnel is glowing brighter for us, represented by this significant improvement in our production situation," John Mendel, executive vice president of U.S. sales, said in the statement. No Light At End of Tunnel By the time parts are back in full supply, there will be little demand for cars. The light at the end of the tunnel is in reality the recession train headed this way. Moreover, durable goods inventories mount. Please consider the Department of Commerce Full Report on Manufacturers' Shipments, Inventories and Orders April 2011 Inventories of manufactured durable goods in April, up sixteen consecutive months, increased $3.3 billion or 0.9 percent to $350.6 billion, unchanged from the previously published increase. This was at the highest level since the series was first published on a NAICS basis and followed a 1.7 percent March increase. 4-Week Moving Average of Weekly Unemployment Claims 425,500 As expected, the 4-week moving average of Weekly Unemployment Claims dropped by 14,000 to 425,500, a decrease of 14,000 from the previous week's revised average of 439,500. That number was very easy to game as noted in Mood Swings: Economists Rush to Lower Payroll Estimates; What to Expect on Thursday and Friday. My guess was 427,000. Tomorrow's job report is much more of a crap shoot. What to Expect on Friday? Garbage. That's what. I will take the under on jobs and the over on the expected unemployment rate of 8.9%. For a guess on the latter, 9.2% seems reasonable on the data (and that was my opinion before the ISM and ADP reports). However, Lord only knows how many people the BLS might say dropped out of the labor force. Bear in mind that McDonald's added 50,000 to 70,000 jobs and those jobs may affect the establishment survey. However, no one knows because the BLS will not confirm who is in the survey. Regardless, if burger flipping saves the day, it won't last. 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.

Superb Russell Napier Interview on Financial Sense; Will the S&P Drop to 400 as Napier Suggests? Why it Might Not Posted: 01 Jun 2011 11:48 PM PDT Reader Chris sent the following comment regarding a Russell Napier Interview on Financial Sense: Hi Mish if you get a chance, I highly recommend this Russell Napier interview with Jim Puplava. I think Napier is incredibly rational and knowledgeable, with a very interesting perspective on things. This is the best interview I have heard for a while. Napier seems reasonably aligned with your own views on deflation and what you have been saying on stock market valuations. Napier sees the scary prospect of a slumping economy and higher bond yields something that has not happened for a long time, as usually bonds do well when the economy sinks. Napier likens it to 1931 when the UK came off the gold standard. I concur with Chris and would also like to add that Jim Puplava is one of the best interviewers around. Here are a few select quotes from the Financial Sense audio Russell Napier Discusses the Failure of QE2 and the Coming QE3 Puplava: For stocks to continue to do well, don't we need to see mild inflation and sustained economic growth, and do you see that as a possibility? The leading economic indicators would probably tell us otherwise. Napier: I think we need to see more than that. The cyclically adjusted PE does not forecasting this level [of GDP] or associated with this economic outcome, it has been associated with very good economic outcomes. That is why I don't buy the story here. Many people say that equities are cheap. Well they are cheap based on current earnings but current earnings are at an all-time high. We have a reasonable measure of this going back to 1929. You find that corporate profit as a share of GDP is the highest it has been since 1929. This is a very mean-reverting figure. So this stock market is pricing in more than a median economic recovery. Yet as you say, even asking for an average economic recovery is a big ask at this stage. The Fed has distorted two asset prices: treasuries and equities, but they have not yet produced a rise in fundamental economic activity to support these valuations. Puplava: If I look at your analysis, so far you would argue that QE2 has failed, and a lack of broad money growth will mean that growth and inflation expectations are too high. That implies, likewise that equity prices should fall, and yields rise which you believe could lead to deflation and a bad environment for equities. Napier: Equities are overpriced and bonds overpriced. But the thing I am saying that is really quite different is normally when the economy slows bonds do well, that is the normal relationship. That's what everybody expects. What I am saying is a much more frightening scenario, where the economy slows and bond yields go up. And the reason I am suggesting they go up is the matters underpinning their path of huge inflows of foreign central bank capital simply stop coming or slow very dramatically. You might say that this just does not happen. You just do not get scenarios like this. But what springs to mind is 1931 when falling Britain's exit from the gold standard and people panicked that America would do the same, and when they realized that money they lent to America the American government would be paid back in pieces of paper that would be worth less than gold, then suddenly bond yields went up into a depression as people reassessed the quality of the paper they would be paid back with. I think that is where we are going, not just for the United stated but the developed world markets. .... If the Chinese find a Paul Volcker, we all better be very careful. Puplava: If some event like that happens, in 2009 the S&P 500 touched 666, could we go back to those levels again, or in fact lower? Napier: In my 2005 book "Anatomy of the Bear" I forecast the S&P would bottom in 2014 and the S&P would get to 400. I do not have a strong feeling as to the particular year it happens, but 400 number is looking at the low points over the last 100 years, of cyclically adjusted PEs, and also the Q-Ratio which is measuring equities to the replacement value of assets, and if the valuation measures continue to mean-revert, then we are not talking 666 but a number near 400. The bottoms I talked about in the book are not about business cycles, they are about things much bigger than that: the first world war, the great depression, the second world war, and the collapse of the Bretton Woods agreement. And this is right up there with the collapse of the Bretton Woods agreement. This is an emerging market that says we no longer think the developed world has good credit quality and we refuse to back developed world governments with our capital. If we begin to question the credit of governments of the developed world then this [400] is where we go to. In Austrian terms, the Austrians always tell us we have creative destruction. We have had several business cycles governments have refused to permit creative destruction of the private sector. They threw their balance sheets and the balance sheets of the central banks on the line to stop creative destruction. So the ultimate situation we have to get to is the creative destruction of the government. Puplava: Given this forecast that seems highly likely, what would it take to turn you more positive on the equity environment? Napier: As a historian, the one thing that can always come along is technology that permits much higher level of productivity growth. Cheap energy is something that could transform long-term growth forecasts. There may be many others, but I can't see them on the horizon. ========================= That concludes the Financial Sense audio excerpts. Here is a link to the much shorter Financial Times video Long View: Historian sees S&P fall to 400 Stock market historian and CLSA consultant Russell Napier discusses with head of Lex John Authers his warning that the real bear market in the S&P has yet to come and could push the US equities index down to 400, plus he explains how emerging markets could trigger a leap in US Treasury yields. (11m 16sec) Stocks Tremendously Overpriced In 2007 people might even have thought Napier was a bearish fool. He clearly wasn't. The S&P 500 fell to 666 and there is no reason why that level cannot be tested again. I made the case recently in Negative Annualized Stock Market Returns for the Next 10 Years or Longer? It's Far More Likely Than You Think As a follow-up, please consider Anatomy of Bubbles; Negative Returns for a Decade Revisited; Is Gold in a Bubble? Overvalued is Not a Price Target Stock prices are tremendously overpriced. However, I do not know if we see Napier's targets or not. Overpriced can be worked off by a stock market that goes nowhere for 10 years or a stock market that takes another plunge. It can even be worked off by a bigger rally now before a plunge. I seriously doubt the latter, but it is certainly possible. What's Different Now? The big difference that I see now vs. 2008 and early 2009 is corporate cash levels. Cash levels are much higher today thanks to a certifiable bubble in corporate bonds. Google, which does not even need cash raised billions in a 10 year blended offering at 2.33%. Google will not default but that is ridiculous . Why lend money at 2.33% for 10 years when such a paltry yield does not possibly compensate for the risk of much higher rates a few years from now, possibly even next year? Who knows what interest rates will be 5 years from now? I don't. Nor does anyone else. Regardless, corporations from total junk to top-tier are flush from with cash from debt offerings. Unless corporations blow it on stock buybacks or acquisitions at absurd prices, corporations have a chance to sit on cash (debt really), for a long as the terms permit. Thus, corporations can weather a cash-crunch storm today better than a couple years ago. In the midst of the decline in 2008-2009 there was a genuine fear corporations in need of cash could not raise that cash. Now they have cash-on-hand in advance. It sits on the balance sheet as debt (it is debt), but it is spendable. The best use for that cash is to let it sit there. If instead, corporations blow it on absurd buybacks at silly prices we will be back in the 2008 crash scenario. For reasons Napier suggests the markets could crash anyway. Not knowing what corporations or the Fed will do (or in what time-frame), I see no need to make a prediction other than to say history suggests that stock market outcomes from here are highly unlikely to be favorable even if corporations avoid serious mistakes. 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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