joi, 5 ianuarie 2012

Building Links & Driving Traffic with How To Posts Graywolf's SEO Blog

Building Links & Driving Traffic with How To Posts Graywolf's SEO Blog


Building Links & Driving Traffic with How To Posts

Posted: 05 Jan 2012 10:47 AM PST

Post image for Building Links & Driving Traffic with How To Posts

When you are looking to build links and drive traffic, one of the time tested methods that continues to work is creating “how to” style posts. In this article, we’ll look at some examples and discuss how to get the most out of the tactic, how to take advantage of seasonal search/traffic volume, and some potential trouble spots to watch out for.

From the earliest days of the internet, people have turned to search engines to find information and to solve problems. When you create “how to” posts, you fill this “information vacuum.” If your posts are good, interesting, funny, informative or otherwise noteworthy, you will be rewarded with links and/or Facebook likes, Twitter mentions or other social signals. While you will have to do a little promotion to “prime the pump” and start the sharing and exposure, people will share it on their own if your piece is good enough.

But enough theory. Let’s look at some “how to” examples.  First up is from the Huffington Post: “How to Tell When Chocolate Goes Bad

How to tell When Chocolate Goes Bad

We’ve all picked up the old Valentine’s, Halloween, or Christmas chocolate and wondered if it was safe to eat. This post answers that questions and lets you know what that white stuff on an old piece of chocolate really is. This post could have been improved with some picture examples, but it’s fine as it stands. This kind of post would work in a food-related website, gift-related website, or mom/family website.

Next up: “How to Tile a Bathroom

How to Tile a Bathroom

Tiling a bathroom is project that requires some skill, but it is within the reach of most DIY weekend warriors with some technical abilities. It’s also something that’s highly bookmark-able and shareable if it’s easy to understand. This type of content would work on DIY sites, home repair websites, building material websites, or tile stores. That article had good picture use. Adding a video or two could help, but it’s something that could be done down the road.

The previous two “how to” articles are examples of evergreen content (ie content that doesn’t need to change or be updated often). Next, I’d like to take a look at “how to” posts that will change over time.  Take a look at “[How to setup a wireless network]“.

If you look at the SERP you’ll see three of the results don’t have a date and one post that does–and it’s an old date, in this case 2003. If I’m looking to solve a computer problem, I probably don’t want information from 2003; I want something from within the last 12-18 months (for more information on how Google determines page dates, see How Google is Reverse Engineering Page Dates). If you are writing a “how to” post and it has a limited shelf life, having a dated post isn’t a bad thing (ie how to format a Windows XP hard drive). However, in most cases, you will want your “how to” posts to rank for longer periods of time, so either don’t show the date on the page or update the information and update the publication date. If you choose to update the post, use a living URL implementation to preserve your existing links and social proof.

Unless you are running a news website, it’s very likely that there are plenty of opportunities to take advantage of “how to” posts. If you run an eCommerce website, you should start with your most popular products and create “how to” guides for each of them. If you think you are going to have a large library of “how to” posts, you may want to put them in specific directory. I’d also suggest using a slightly less commercial template: people tend to link and share posts that don’t look overly commercial more often. I’d also avoid numbers in your URLs to avoid the problem of search engines mis-interpreting dates. Doing so also doesn’t box you into an editorial mismatch if you change numbers/steps in the future. I’d also look for ways to maximize seasonal search volume by updating your seasonal content. For example, a “how to” post on carving a turkey will get more traction, links, and traffic if you publish it in the beginning of November instead of the middle of March. Lastly, try to phrase your “how to” posts to match the queries users are actually typing into a search engine. For example “How to Save Some Sheckels When Getting Hitched” is not going to drive the same amount of traffic as “How to Save Money When You Are Planning a Wedding.”

So what are the takeaways from this post:

  • Look to create “how to” posts for your most popular products or search terms
  • Use natural language that matches what consumers will use
  • Be careful of dates on evergreen posts
  • Decide if archiving old information or updating them with living URLs is better for your situation
  • Avoid using numbers and dates in URLs
  • Time your posts/updates to tie in with peak search volume or interest
  • Have a separate template for informational posts to increase linking and sharing

photo credit: Shutterstock/Dmitry Suzdalev

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Building Links & Driving Traffic with How To Posts

How Google+ Uses SEO to Steal Search from Facebook and Twitter

How Google+ Uses SEO to Steal Search from Facebook and Twitter


How Google+ Uses SEO to Steal Search from Facebook and Twitter

Posted: 04 Jan 2012 12:49 PM PST

Posted by Cyrus Shepard

Google's Superior SEO Strategy

Notice anything odd about your Google+ profile? Does it rank incredibly well in Google’s search results for your own name?

Colleagues note that their G+ profile now outranks other online identities that they’ve worked for years on. My own Google+ profile, just 5 months old, ranks #2 for my name. It now ranks higher than both my Twitter and Facebook profiles, even though I use those services far more often.

Profiles aren’t the only thing ranking. Individual Google+ posts frequently appear in search results as well.

Google+ Domination

Ranking for people’s names is one of the Holy Grails of search, like Amazon ranking for every book in print. With 7 billion people in the world, ranking on the first page for even a small portion of these is lucrative territory.

As search and social focus more on the individual, the war over names has begun.

How has Google won so much real estate on their own search pages in such a short period of time? Do they cheat? No, not really - more on this later. Google wins by employing really smart Search Engine Optimization techniques – the same SEO practices available to any online business.

For Facebook especially, this is a sensitive issue. Facebook actively prevents Google from crawling most of its content, allowing big G to access “Fan” pages, but limiting information from regular profiles. Now that Google+ has entered the social game, this policy puts Facebook results at risk of dropping in rankings and losing search real estate.

I often work with websites and startups wanting to build SEO features into their platform. If I were to build a social media service for SEO domination from scratch, I would build it exactly like Google+.

Here's the takeaway: Use SEO to your competitive advantage, no matter your niche.

1. Incentivize Inbound Links

Not long ago, Google started displaying author photos in its search results. In order to display a photo, Google asks authors to add links from their webpages to their Google+ profile. This creates potentially millions of high quality links from the world’s most influential online publishers, all pointing to multiple Google+ profiles.

Google+ Linking

Twitter and Facebook both benefit from similar links, but never before has a social media service offered such an incentive.

Google's SEO Tactic: Require Authors to Link to their Google+ Profile

2. Internal Linking

One thing noted about Google+ when it was released was just how easy it was to be in lots of circles, or add lots of people to your own. People who struggled on Twitter for years to build up 1000 followers, suddenly found themselves in 2000 or 3000 Google+ circles, seemingly overnight.

Circle Count

Google’s strategy to connect everyone on the planet also makes for good internal linking. Following more than 1000 people may not create a practical social experience, but it creates a great SEO opportunity. The more your content is shared in other people’s streams and profiles, then the more your content is crawled, indexed, and deemed important by search engines.

Google's SEO Tactic: Encourage Large Circles Counts

3. Lots of Indexable Content

My public Google+ profile contains a wealth of information, all visible to search engines, including:

  • Biographical Information
  • Full Text of Public Posts
  • Photos
  • Links to people who have added me to their circles
  • Everything I have ever +1’d

Compare that to my Twitter account – limited to 160 characters of biographical information, or my Facebook profile, which reads like an auto-generated pamphlet.

Consider how a search engine sees these pages. Take a look at the source code of any Google+ profile or use a tool SEO-browser (a search robot simulator) to see how many words appear on each profile.

  • Facebook – 275 Words

  • Twitter – 491 Words

  • Google+ – 2621 Words

Google structures content to provide a wealth of information for search engines, to index and serve in search results.

Google's SEO Tactic: Search Engine Friendly Profiles

4. On-Page Optimization

Google+ makes it easy to share posts from others – a feature much like retweeting on Twitter or reblogging on Tumblr. These Google+ posts frequently show up in search results as their own entries.

As the title tag is one of the most important aspects of on-page optimization, Google wisely choose longer, more descriptive title tags. Compare these to the shorter title tags offered by Facebook and Twitter, which often run no longer than three unique words.

Here’s the title tag to 3 different posts, all by Rand Fishkin. Each of these posts is indexed by Google.

  • FacebookYesterday, I…
  • TwitterTwitter / @randfish: Running test of Google+’s …
  • Google+Rand Fishkin – Google+ – Shocking how many of the folks featured in this post form…

Which do you think ranks better for a query with “Rand Fishkin” in the search?

Rand Fishkin

Google's SEO Tactic: Descriptive Title Tags

5. User Generated Content

Every post I’ve ever written on Google+ has been public. As a result, every post has been crawled and indexed by Google search. The privacy settings on the profiles are simple, intuitive and encourage openness.

The big green button screams, “Pick me! Pick me!”

Share Google+

Most Twitter posts are public by default, although unless a tweet becomes famous the 140 character limit prevents most tweets from reaching the definition of “rich” content. Facebook, in contrast, only shares posts from fan pages with Google, and not posts from regular profiles.

Google's SEO Tactic: Encourage Public Sharing

6. Show Google+ Author Profiles in Search Results

The first 5 items on this list represent SEO tactics that anyone can use, but in a way #6 belongs to Google alone. By linking to Google+ profiles in search results, they create an advantage that no other social media service can duplicate.

Is Google “cheating” by favoring it’s own property? Some say yes, but on the other hand, is there a more relevant result? To me, it makes more sense to connect my author profile with the website that actually hosts the content, such as my profile on SEOmoz.

Rich Google Snippets

This demonstrates the power of rich snippets. Since Google introduced author photos in search results, webmasters have scrambled to get their mug included – the idea being that rich snippets of all kinds increase click-through rates. The question is, are we increasing the CTR of our own website, or Google+?

Google's SEO Tactic: Creative Rich Snippets

What Can You Do?

Except for #6 above, most of these techniques are available to any online business. Google has found a way to create large amounts of search engine friendly content, and do it at scale.

The lack of diversity this creates in Google's search results is troubling to some. Google risks turning into McGoogle, where every result and every page looks the same. With any luck, more companies will adopt strong SEO strategies to raise themselves in search.

Now that the adoption of Google+ has hit 62 million users and growing, expect to see far more Google+ in your search results soon.


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Photo: Baby, It's Cold Outside

The White House Your Daily Snapshot for
Thursday, January 5, 2012
 

Photo: Baby, It's Cold Outside

President Barack Obama greets neighbors outside the home of William and Endia Eason in Cleveland, Ohio, Jan. 4, 2012. The President visited the Easons, who almost lost their home after falling victim to a predatory lender, to discuss the need for a strong Consumer Financial Protection Bureau. (Official White House Photo by Pete Souza)

In Case You Missed It

Here are some of the top stories from the White House blog:

State and Local Officials, Colleagues Support Cordray Appointment
State and local officials across the country, including many of Richard Cordray’s former Attorneys General colleagues, spoke out about President Obama's decision to appoint Cordray as Director of the Consumer Financial Protection Bureau.

From the Archives: Holly Petraeus Joins the Consumer Financial Protection Bureau
A look back at the work Holly Petraeus has done to help protect servicemembers and their families from predatory financial practices since joining the Consumer Financial Protection Bureau's Office of Servicemember Affairs one year ago.

President Obama Discusses Richard Cordray in Shaker Heights
In Shaker Heights, Ohio, President Obama talks about the fight to help secure a better future for the middle class -- and his decision to appoint Richard Cordray to lead the Consumer Financial Protection Bureau.

Today's Schedule

All times are Eastern Standard Time (EST).

10:00 AM: The President receives the Presidential Daily Briefing

10:50 AM: The President delivers remarks on the Defense Strategic Review WhiteHouse.gov/live

11:45 AM: Press Briefing by Press Secretary Jay Carney

3:30 PM: The President and the Vice President meet with Secretary Geithner

WhiteHouse.gov/live Indicates that the event will be live-streamed on WhiteHouse.gov/Live

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Seth's Blog : "How much are you going to tip?"

"How much are you going to tip?"

Have you ever been asked that question when splitting the check?

There are two couples at the table, the waiter has brought separate checks and the credit card holder turns to the other credit card holder and tries to find out how to coordinate the tip.

Why?

I mean, if they were out just the two of them, would they ask what people at the other table were going to tip? (Probably, hence the need to invent the 15% standard). Why does it matter if one couple tips 14% and the other 18%?

Don't underestimate just how badly many people want to fit in. (Not with everyone, just with their tribe and their peers).

What does it mean to be popular?

Some things (and people) are popular because a chord is struck, because there's a right place/right time alignment of interest and solution. But more often, an idea is popular because something had to be. Tribes demand winners, the flavor of the month, the safe choice.

That's why being the "presumed front-runner" is so vitally important. People want to hire the person or vote for the person or work with the organization that most people in their circle would have picked. They are then blameless.

We say we want to root for the underdog, but actually, we want to be seen as rooting for whomever everyone else is rooting for.

A significant part of marketing to strangers is the work of appearing to be the dominant choice, the safe choice, the one that's going to get picked by everyone else soon. Get in sync, the thinking goes, if you're the kind of person that wants to be in sync.

One example: a restaurant that highlights its most popular dishes virtually guarantees that those dishes will become the most popular.

There are a huge range of tools and signals available to marketers willing to invest in the position of most popular. But the signals are expensive. Because the presumed frontrunner can afford it. Hence the circular nature of marketing investment--acting like you can afford it often means you will soon be able to.

And the best plan for the insurgent brand? To find a smaller tribe, become the presumed winner there, and scale it up across tribes.

 

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miercuri, 4 ianuarie 2012

Mish's Global Economic Trend Analysis

Mish's Global Economic Trend Analysis


US, EU Wage Economic War on Iran; Greece Lifts Objection to Oil Embargo; Warmongers United; Will Cooler Heads Prevail?

Posted: 04 Jan 2012 09:31 PM PST

One might think the US and EU would have enough economic problems already to risk oil soaring to stratospheric heights by an embargo of Iranian oil.

Unfortunately, common sense never gets in the way of bureaucrats and fools or their foolish missions.

Bloomberg reports EU Governments Moving Closer to Iran Oil Embargo as Greece Lifts Objection
European Union governments moved closer to halting oil purchases from Iran, stepping up the confrontation over the Islamic republic's nuclear program.

EU foreign ministers are aiming to announce harsher sanctions on Iran's energy and banking industries at their next meeting on Jan. 30 after Greece lifted its objections to an oil embargo.

"We want to tighten sanctions on Iran -- the things that have been mentioned are the oil sector and the financial sector," EU spokesman Michael Mann said by telephone in Brussels today.

French Foreign Minister Alain Juppe said in Lisbon today that he hopes a decision about an embargo on Iranian oil exports may be adopted at the Jan. 30 meeting of foreign ministers.

The U.S. today welcomed the push toward an embargo.

"This is consistent with tightening the noose around Iran economically," State Department spokeswoman Victoria Nuland said at a briefing in Washington. "The place to get Iran's attention is in the oil sector."
US, EU Wage Economic War on Iran

By some misguided thinking it is OK for the the US to block Iranian oil but not OK for Iran to defend itself or retaliate.

As far as I am concerned, an embargo is an act of war, and only Congress can declare war.

Thus, one seriously has to wonder if the the US is purposely attempting to goad Iran into blocking the Strait of Hormuz, just so the US can flatten Iran.

Warmongers United

Flushed with the "success" of wasting trillions of dollars in Iraq, fighting weapons of mass destruction that did not exist, the US now wants to do the same to Iran.

Oil is Fungible

The best news out of this mess is that oil is fungible, and perhaps embargo disruptions are already priced in. Regardless, as long as Iranian oil gets through, anywhere, prices will not get out of hand.

With that in mind, it would not surprise me one bit to see China send ships to the Gulf, stating flat out that China will defend its right to not have the US interfere with China's oil needs. 

Will Cooler Heads Prevail?

I would love to see someone cram this illegal action so far down Obama's throat it makes him puke. The only problem I see with China asserting Iran's right to ship oil (and it's quite a major problem), is that such actions by China could lead to WW III, just what neocon nutcases want.

By the way, the only candidate from either party against these illegal military and economic actions is Ron Paul.

In an addendum to my  Predictions for 2012, under the category of Energy, I stated  "My prediction is cooler heads prevail."

Perhaps I will be quite wrong on that particular call, quite soon.

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


Brussels Recommends Sucking Spain Dry with Increased VAT; France to Raise Sales Tax to Protect Jobs; Is There Any Point or Reason for the Eurozone?

Posted: 04 Jan 2012 11:13 AM PST

Political hacks are on a roll in Brussels. Spanish unemployment is 22.8%, yet Brussels recommends Spain hike its VAT.

Via Google Translate, please consider Brussels Again Recommend Rise in Spain's VAT
The European Commission hopes to discuss in the coming weeks with the new government of Mariano Rajoy new fiscal consolidation measures to compensate for the deviation from the deficit target in 2011 that could exceed even the 8% vs 6% agreed, and has advanced the VAT increase is one possibility among others.

"We were informed last week by the Spanish authorities of a sizeable deficit, which should be 6% in 2011 and might be about or more than 8% according to latest statistics we have received from Madrid. At the moment, we have no elements to confirm these figures. We are not in a position to state here that the figure will be higher or lower than 8%, "said at a news conference the European Commission spokesman, Olivier Bailly.

Asked whether Brussels remains the recommendation for Spain to raise the VAT, the spokesman insisted that "Spanish authorities are responsible for deciding planning to take other measures to offset the deficit diversion in order to meet the target of 3% in 2013 who are committed to comply ", but insisted that raise VAT is one of the recommendations of Brussels.

"We made ​​several recommendations in the past, including last June. The VAT is one of them. There are many others," explained without going into details.
Raising taxes in the midst of an economic depression (which Spain is in), is pure insanity. Tax hikes will suck dry the already slim chance of a Spanish recovery.

France to Raise Sales Tax to Protect Jobs

Eurozone economic insanity is staggering as this update on the "Social Vat" tax proves. Please consider France Plans To Raise Sales Tax, Following Germany's Lead
French President Nicolas Sarkozy's government said Tuesday that it would borrow yet another page from Germany's economic textbook in a bid to make France's products more competitive and finance the nation's wide-reaching and heavily indebted social-welfare system.

The proposal, which the government said would be implemented before this spring's presidential election, calls for reducing the amount companies contribute to the state-run health-care and pension systems. To make up for the lost income, the center-right government would raise France's value-added tax--a levy similar to sales taxes in the U.S.--which is currently as high as 19.6%.

The government says the measure, often referred to as "social VAT," would act as a powerful tool to protect French jobs, which are increasingly being relocated to lower-cost countries.

French companies would enjoy lower labor costs, while imported products--which would share the higher VAT burden--would help finance France's welfare system. The country's state-run health-care and pension systems are expected to have recorded a combined deficit of EUR18 billion ($23.3 billion) last year.

Social VAT "is good for France and it is good for jobs," French Labor Minister Xavier Bertrand told France 2 television.

Germany increased VAT to 19% from 16% in 2007 to shift part of the burden of social welfare onto consumers.

"Social VAT is antisocial because it is the consumer that will pay," Socialist Party spokesman Benoit Hamon said.

The French VAT proposal comes as Sarkozy struggles against rising unemployment, a slowing economy and a surging trade deficit that is projected to have reached EUR75 billion last year.

"We shouldn't talk nonsense," Jean-Claude Mailly, the secretary-general of Force Ouvriere, France's third-largest labor union, said on French radio. "It's not with one or two points of VAT that we will compete with Chinese products."

Moreover, as France can't get near China's labor costs, social VAT would be more of a competitive assault on France's euro-zone neighbors.

The measure is equivalent to a currency devaluation because it effectively increases the price of imports and decreases the price of exports. In the past, France repeatedly devalued the franc against the mark to make its economy more competitive.

If other countries followed suit, inflation would still be pushed up without any gain in competitiveness, said Eric Heyer, economist at the OFCE, the French economic think tank.

"We created a single currency to avoid competitive devaluations," Heyer said.
Is There Any Point or Reason for the Eurozone?

"We created a single currency to avoid competitive devaluations". Indeed, that was one purpose wasn't it? The other purpose was to increase trade. Now France is imposing a sales tax specifically to protect French jobs from Spanish competition.

Just how is Spain supposed to pay back French and German banks if other European countries seek to block Spanish exports?

I suggest Spain should not even try. It is futile. Since, Spain is going to leave the Eurozone anyway, it would be better to do it sooner rather than later as these actions by France proves.

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


"Social VAT" Trade Wars Heat Up Between Spain and France

Posted: 04 Jan 2012 08:10 AM PST

Trade wars are on the horizon everywhere I look. Election politics have brought them to the forefront in France.

Via somewhat choppy but understandable Google Translation, please consider France to Increase the 'Social VAT' Before the May Presidential Election
The French government intends to implement the so-called 'social VAT' levied on products imported from countries with low production costs in order to apply a reduction in social contributions, before presidential elections next spring, as confirmed Budget Minister and government spokesman Gallo, Valérie Pécresse.

"The social tax to create jobs in France and to prevent imported products sold in our country at low cost is going to apply, and we will do before the presidential election," he said Pécresse told France Info.

The minister also said that this Budget proposal will be discussed with the French unions in the social summit is scheduled to be held on 18 January at the Elysee Palace.

In this regard, Bertrand defended the implementation of this measure by the "general interest" of employment and the country, and stressed that in France there are "too many burdens on the job." As an example, said that for every $ 100 of gross wages, account charges 39 euros in Germany, while France is 50 euros.

"I prefer to penalize imports, which have long criminalized the financing of social protection is now to finance social protection", had an impact.

Opposition criticism

Sarkozy's proposal to establish the social tax, announced in his speech on December 31 has been widely criticized by the opposition, including the Socialist Party, which sees as a "social and economic mistake."
Social and Economic Mistake

The interesting thing is the Socialist Party understands the proposal to be a "social and economic mistake" (which of course it is).

When attempting to buy votes, no one cares about mistakes of any kind, and unfortunately private citizens (not politicians) suffer the consequences.

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


What is Greece's Least Bad Option?

Posted: 04 Jan 2012 12:24 AM PST

Inquiring minds might be wondering what is the best way forward for Greece. To some extent, the question is akin to asking "would you prefer to lose a one hand and one eye or your left leg?"

I have been thinking about the Greece "least bad" question for quite some time, but what brought about this post is a "by the editors" article on Bloomberg.

Please consider Greece's Least Bad Option Looks to Be Internal Devaluation: View
Greece and some other euro-area economies face years of financial struggle even if they manage to restructure their debts. Their prospects are so bleak that, according to one school of thought, they would be better off outside the euro system, despite the immediate costs of leaving.

We disagree, and not just because the immediate costs of an exit would be enormous. Even after that penalty was paid, resurrecting national currencies and regaining control of monetary policy would create as many problems as they solved.

....

Inside the system, the peripheral countries have learned a harsh lesson: They must hold growth in wages to the euro area's rate of inflation plus any increase in national productivity. In countries such as Greece, this demands a new approach to wage bargaining by employers and unions. Overall, though, it should be no more difficult than managing a floating currency. And on this path the reward for success is greater: lower inflation rates and, with luck, faster economic growth.

None of this alters the fact that Greece, so slow to learn the new rules, would have been better off not joining the euro system in the first place. But it did join, and its best bet now is to make it work.
Bloomberg Right About One Point

Bloomberg is right about one thing, that Greece should not be in the Eurozone. However, Spain, Portugal, Ireland, Italy, France, and Germany should not be in the Eurozone either.

In short, the Eurozone is a fatally flawed mechanism doomed to failure.  No country should be in the Eurozone, as constructed.

Some may disagree with that prognosis, but even if they are correct, what is the likelihood that German voters and the German supreme court will ever accept the "transfer union" that can make the Euro ever work?

For the sake of argument let's assume 25%.

Now, in the current state of European politics (and more importantly Greek politics), what are the odds Greece can stick with the mandates set by the Troika?

Once again, for the sake of argument, let's assume 25%.

For the record, I think both of those are on the high side, but assuming both happen, the odds Greece stays in the Eurozone are .25 * .25 or 6.25%.

Regardless of how one calculates the odds, the same arguments that Bloomberg makes today could have been made (and were made by many parties) two years ago, a year ago, six months ago, and two months ago.

Water Under the Dam

At every critical juncture, the consequences for Greece to "stay in the Eurozone" have done nothing but get worse. The lesson here is the sooner a country tells the EMU to "go to hell", the better off the consequences.

That is all water under the dam. The question is "what to do now?"

Clearly if Greece is going to exit (and I think it will), the sooner the better. However, let's ponder the 6.25% chance that the Eurozone stays intact, including Greece.

Greek Exit Means Hyperinflation, Staying in a Decade's Long Depression

If Greece exits the Eurozone, I suspect Greece would enter a period of hyperinflation. The country and the Drachma will be ruined. On the other hand, if Greece stays in the Eurozone, it will face decades long austerity measures and a permanent depression for a decade.

At least in the former case, Greece may get this over and done with in a time-frame of 2-3 years.

Is that outcome worse than massive austerity measures and a permanent depression for a decade, in which Greek voters may decide at any time they have had enough?

Perspective of the EMU

From the perspective of Greece, the best approach was to exit 2 years ago, 1 year ago, six months ago and now.

Interestingly, the same applies for the rest of the Eurozone. Had Greece left two years ago the consequences on the Eurozone banking system may have been 40 billion Euros. In an attempt to prevent what now appears inevitable, the Troika responded with a 100 billion Euro bailout and now needs a second bailout of at least equal size.

Will another 100 billion Euro bailout help? 200 billion? 500 billion? How? And at whose expense?

Moreover, even if bailouts could in theory help, will Greece be able to stick with the austerity plan (and resultant depression) for a decade?

Conclusion

The worst option for Greece and the banks is for Greece to stay the course for years (as it has) then eventually give up (which it will).

The best option from the point of view of Greece (as well as the EMU) is for Greece to default and kiss the Eurozone goodbye, right now.

Unfortunately, misguided politicians, Eurocrats, ECB officials, and analysts have gotten in the way, with dire consequences for Greece, European banks, and the entire Eurozone.

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