marți, 13 martie 2012

The Brand of SEO and the Trend of Inbound Marketing

The Brand of SEO and the Trend of Inbound Marketing


The Brand of SEO and the Trend of Inbound Marketing

Posted: 12 Mar 2012 02:08 PM PDT

Posted by randfish

The web marketing community, and specifically many folks in the search field have recently been engaging in lots of conversations about the industry's nomenclature. I think these discussions are excellent to have and I'm glad we're openly communicating with one another on the topic. If there's to be a shift or a progression in how online marketers focused on non-paid channels describe themselves and their work, I believe rigorous debate is a great starting point. And, as part of that belief, I want to share my views on the topic.


I've been in SEO a long time; at the end of this year, it will have been a decade since I joined my first SEO forum and attempted to learn how to capture the magical, free trafic that engines like MSN, Yahoo! and the emerging Google could send. In 2005, after experiencing the remarkable, positive impact SEO could have, I went from a practitioner to an evangelist. I loved SEO and I still love it. I love the complexities of search technology, the overwhelmingly vast sea of technical tactics, the individual stories, the packed conference-hall bars, the dark stories of spam and the illuminating tales of white hat triumphs. But, most of all, I love the people. I have met most of my best friends, hundreds of people I wish I saw more of and literally thousands of awesome individuals all around the world thanks to this field.

To say I'm a raving, fanatical, lunatic SEO evangelist is putting it mildly.

But over the past 3 years, I've been gradually coming around to the viewpoint that in spite of my personal adoration for all things organic search, the outside world of marketing departments, startups, small-medium businesses and individual consumers doesn't see it that way. Last night, a startup friend of mine was over, reviewing a slide deck I'm building for another round of fundraising pain, when he received a spam email trying to buy some links on his site.

"Ha. You SEO guys never quit do you?"

Then today, in an interview with a candidate, I asked her about her background in SEO and she replied, "I told my husband about SEOmoz and he said 'SEO company? Watch out, those guys are spammy and untrustworthy." We talked through it, of course, but if you're in the field, you surely encounter this feedback daily, too.

There's the problem. No matter how many cities I fly to, or times I evangelize the great things SEO can do, no matter how many blog posts or retweets or guest articles, it will always carry with it the taint of manipulation and inauthenticity. Even from those who know better. Even from those who've invested in SEO. And always, always from the mainstream and tech media.

So what's to be done? Should we give up using the acronym? Perhaps shift to something like "get found online," "search engine visibility" or "content optimization?"

In my opinion, those aren't real options. SEO is an established practice and it's an established, descriptive term. For millions of people around the world, it carries the accurate meaning - the practice of improving a brand's visibility in and traffic from search engines. That meaning may be negatively tarnished by frustrating and inaccurate brand sentiments, but even if we could shift to a new phrase, this new moniker would undoubtedly attract the same sorts of bad actors who cloud SEO's perception today.

For better or worse, SEO is here to stay.

But I'm not blind to the emerging reality: a shift in terminology is accompanying the growth in responsibilities of professional SEOs. I did some simplistic LinkedIn research recently that's illustrated below:

Web Marketing Landscape via LinkedIn

That figure above shows overlap between these various fields and skillsets, and it's my opinion that we're going to see considerably more overlap between them in the years to come. To be an effective social media marketer, you must understand content, analytics and SEO. To be a great SEO, you need social media, content marketing, analytics and CRO skills. The "specialist/generalist marketers" - those who excel at a particular facet but have competence in all of them - are best poised to win in the upcoming decade of marketing.

We need a way to describe this combination - it's simply too cumbersome and not descriptive enough to say one's job is: "Content creation, combined with investments in both the technical and outreach-based tactics in channels such as organic search, social networks, blogs and other websites, measured through analytics and tuned with conversion rate optimization." That's a mouthful, but it's getting to be a more and more common mouthful, because this process needs to be explained!

Some say "SEO" already encompasses these:


This is hard, because in many ways, I agree. If you're a modern SEO and you don't also embrace content creation, social media marketing, link outreach for brand and direct traffic value (beyond their algorithmic contributions), PR, CRO and analytics, you're probably not achieving all that you could by combining these practices (at least a little). And yet, there's no way to explain to the outside world (even those in web marketing but not directly tied to SEO) that "search engine optimization" also includes "social media" or "conversion rate optimization" or "public relations" or "content marketing." SEO necessarily equates to search engine-bsaed stuff. Social media and other practices may have direct and indirect positive influences, but to an outsider, SEO will never mean all of these things, and saying you do "SEO" will never carry the meaning of that bolded sentence above.

Hence, we need a term/phrase that accurately describes this combination (but is not "Internet Marketing" since that phrase encompasses vastly more than what we're trying to get across, paid channels in particular).

I've been a personal fan of the concept behind Inbound Marketing for a long time - that we should earn our customers' attention rather than interrupting them by buying it. I gave a talk about inbound for startups last December in Silicon Valley:

If you skip to 7:05 or so in the video, you can see the start of my talk, one of the better ones I've given in the past year.

I recognize that not everyone in the marketing and search field feels as positive as I do toward the phrase "inbound marketing." But, I am seeing nearly everyone adopt the principles behind it, which include:

  • Combining the practices of content creation and conversion optimization to earn visitors' trust and their business
  • Jointly leveraging the channels of search, social, blogs, PR, referring links, email and word-of-mouth to promote this content
  • Using sophisticated analytics practices like first-touch and multi-touch attribution to better understand the true value of your content and your visitor sources

I asked on Twitter last week about alternatives to "inbound marketing" that still mean the same thing - narrow enough to exclusively focus on free channels of web-based customer acquisition (which terms like "Internet marketing" or "digital marketing" wouldn't), yet broad enough to include the items mentioned above. Two other suggestions seemed widely-adopted enough to consider: "earned media" and "organic marketing." I ran a comparison of these across several services:

Comparison of Terminology

That chart above compares keyword searches on LinkedIn, SimplyHired, Google News, Google's AdWords Tool (for exact matches) and Topsy's Analytics. To be fair, all of these trail behind the individual tactics like "SEO," "social media," or "blogging," (as I noted above, they're not meant to replace those terms, but rather to explain the marketing practice that combines them). Inbound is clearly many steps ahead of the other two, though "earned media" has a lot of traction in the c-suites of large enterprises and publishers.

Even if inbound marketing isn't the term that wins the lexicon battle, I believe the principles behind it are sound. They work. And they earn outsized returns to investments in most paid marketing channels or myopically singular investments on search, social or content alone. That's a message I've been working to refine and spread for some time now.

Many of you reading this blog likely know that I started a personal project with my friend Dharmesh (from Onstartups & Hubspot) called Inbound.org. It's a site that seeks to highlight some of the best content around the marketing world. Along with that, I'm putting more effort into broadening my expertise in fields like content marketing, social media, CRO and PR, and when I talk about it publicly, I call it inbound marketing. Many other organizations, from software firms like Wordstream and Optify to agencies like TrustE, Weidert, Kuno Creative and Volinsky to blogs like Distilled, Kiss Metrics and Search Engine Land are using this language, too.

I wouldn't say the terminology has overwhelming adoption, nor that it's necessarily won the market, but I would argue that the concept and principles are unstoppable and need a name. I don't think explaining that SEO means a bunch of other non-search-engine-related marketing practices is viable, nor do I think it's practical to explain the full concept every time you want to refer to it. SEO, in my opinion, isn't going anywhere, but it has tactical allies today that didn't exist 5 years ago, and I hope that some terminology encompassing these techniques takes root.

As always, I'm looking forward to your thoughts on the trends of marketers focused on inbound/organic/free channels and the emerging use of "inbound marketing," itself. I'll do my best to contribute to the discussion in the comments, too :-)


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Understand and Rock the Google Venice Update

Posted: 12 Mar 2012 05:31 AM PDT

Posted by NiftyMarketing

I am slightly shocked and simply amused that the recent Google Venice Update has largely flown under the radar. The Inside Search Blog published a list of 40 some-odd changes to the algorithm for February, and it seems that Panda 3.3 and the mysterious one liner about link valuation captivated most of the SEO and Inbound world, but what caught my local attention was this…

Improvements to ranking for local search results. [launch codename “Venice”] This improvement improves the triggering of Local Universal results by relying more on the ranking of our main search results as a signal.

"Improved local results. We launched a new system to find results from a user’s city more reliably. Now we’re better able to detect when both queries and documents are local to the user."

What in Tarnation does that mean?

The Update

Simply put, the Venice update localized organic results on broad search queries. Got that? If not, here are some examples…

The Results

Search “Divorce Attorney” with location set to United States.

National Serp Result

Search “Divorce Attorney” with location set to Las Vegas.

Las Vegas

Search “Divorce Lawyer” with location set to Chicago.

 

Chicago SERP

I know what you're thinking…. “Of course they did that on the term divorce lawyer. It’s a super localized search phrase. Unless a person has spouses in multiple states that is.”

 

But look at this SEO search query…

SEO Serp

It is clear that finally 2012 can be declared the year of local. With Google Places localized results + Google Organic Localized results every company needs a localized plan weather you have a single location, multiple location…or no locations at all because the national SERPS just got a lot more crowded.

The Plan

Step 1: Analyze the localized results on your queries.

A wise man once said, “If you can’t beat em, join em.” This is my favorite applicable SEO quote as generally the people who are outranking you are doing something that you SHOULD be doing. This is definitely the case with the Venice update. Here are the common elements that I see these localized sites have…

  • Local Landing Pages: Findlaw.com doesn’t have a physical address in Las Vegas. But they sure do have a landing page for it located at URL below. You might need an address to play in Google Places, but not in the organic league.

http://lawyers.findlaw.com/lawyer/firm/Divorce/Las-Vegas/Nevada

  • Title tag and description: Location + Keyword. This is pretty basic information but crucial in ALL cases that I have seen of localized organic results.

Title Tag

  • Localized Page Content: Usedcars.com makes good use of Header Tags and site content focusing on the Las Vegas market and different types of cars. While cookie cutter content, for now this is doing the trick for them.

Used Car Screenshot

  • Local Link Profile: Look at one of the high ranking localized results on the term “divorce attorney” with the location set to Las Vegas using opensiteexplorer.org.

link profile

Not exactly the most “natural” looking link profile but extremely effective in beating the localized filter in this case. A large percentage of the links have the term “Las Vegas” listed and for small sites that don’t have the overall authority of large sites, this seems to be the common trend.

Step 2: Do way more than the competition.

There is a common trend with companies that do well in the SERP rankings...they do more than the competition. These tactics will help you go above and beyond....

  • Site Architecture: Getting 1000’s of pages indexed has just become a reality that all national players need to re-examine or they won't be able to compete with localized results. How can you structure your navigation to get that juice to your local pages? Your home page might not have a chance to rank any more. Unless you are the top 1-3 National organic results. Most websites I have seen haven’t put value on localized pages compared to product pages. Get busy rethinking.
  • Unique Localized Page Content: This is the true issue with localization. Most sites have cookie cutter content that might rank for locations, but it also might lead to a nice Panda slap for duplicate content. I would not build content and just replace the location information. If you are still doing this you are playing on dangerous grounds. Scaling localized page content is not easy, not very fun, and definitely not sexy. So, the companies that can make it easy, fun, and sexy are going to be the clear Venice winners.

Here are some ideas:

1. Location based reviews – Instead of one testimonial site wide add a testimonial in every market you can. It helps to sell the “locationalism” to the searcher and it’s content that doesn’t have to be written by you… just gathered.

2. Gather “Why I love my city” user generated content – Ask customers to write up information about their local city and why they like it. It’s unique and fun to read.

3. Write out directions to each location – Have you ever heard people tell directions the same way? No chance of duplicate content with directions…ever.

  • Markup Addresses in Schema and hCard: This has become a favorite practice of mine and I am shocked that there are so few doing it. Use schema-creator.org and microformats.org to markup your address and business information. This helps send a very clear signal to search engines of your location and could be a factor in getting a +box.

+map box

  • Add a KML File and GeoSitemap to your website: By far the most under-utilized tactic that will go the farthest with this update. A KML file is used to determine the exact address and latitude/longitude of a company. It’s like a location dog tag for your website. You can create one with this tool Geo Sitemap Generator. Here’s a diagram of how they work…

kml

  • Authoritative Local Link Building: It is easy to blast local links with article marketing, commenting, forum link building, and other basic methods to your local pages. But achieving authoritative local links take some serious work. Here are a couple tactics that will go a long way.

1. Microsites: Build microsites for the submarkets of a large city. Put detail into making these sites unique and useful though small. Focus your link building efforts at these sites and then use brand + location + keyword targeted anchor text pointing back at your main site. This approach gets you authoritative links from sites that are in the same business and market that you are...and you own the site.

2. Local Guest Posting: Find hyperlocal blogs in your city. They are usually desperate for good content from locals. You don’t necessarily have to write about your industry though it would be nice to have the information semi-related. The main thing is using the author box to let people know you are a “location + keyword”.

Step 3: Follow some Locals…

Both of these lists contain top experts in the local search field. I know most of these people personally and vouch for them and their expertise in dealing with geo search tactics. The Local Search ecosystem is a different way of thinking so please take time to check out these lists and get on the radar of these localholics.

The Google Venice update should ultimately change the way SEOs think about reaching searchers and a localized national approach to organic traffic will need to merge. Is this approach new? No, it's common sense longtail SEO that has been separating the "diggers" from "pickers" for many years. The difference now is that the surface is getting bare and the gold that is left is all underground. Happy digging.


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$7,610 a minute

The White House

Your Daily Snapshot for
Tuesday, March 13, 2012

 

$7,610 a minute

As gas prices rise, oil companies just watch their profits increase. And yet, they're still subsidized by Congress to the tune of $4 billion a year.

That's about $7,610 every minute.

To learn more about why gas prices are on the rise and President Obama's strategy to take control of our energy future and avoid gas spike prices in the future, check out our new infographic.

Number of the day

In Case You Missed It

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

An Announcement From FEMA and AmeriCorps
The Federal Emergency Management Agency and the Corporation for National and Community Service announce a new partnership designed to strengthen the nation's ability to respond to and recover from disasters.

The Facts on Gas Prices: Infographic
Check out our infographic that explains the President's all-of-the-above energy plan and its relationship to gas prices.

Revamping Job Training with the American Job Center
Here are more details of the President's proposal to reform our nation's re-employment system and help up to one million displaced workers each year.

Today's Schedule

All times are Eastern Standard Time (EST).

9:45 AM: The President receives the Presidential Daily Briefing

10:15 AM: The President meets with senior advisors

10:50 AM: The President meets with the 2012 Intel Science Talent Search finalists

11:10 AM: The President delivers a statement announcing new efforts to enforce our trade rights with China and level the playing field for America’s businesses and workers WhiteHouse.gov/live

1:00 PM: Press Briefing by Press Secretary Jay Carney WhiteHouse.gov/live

4:20 PM: The President and Prime Minister Cameron depart the White House en route Joint Base Andrews
                   
4:35 PM: The President and Prime Minister Cameron depart Joint Base Andrews en route Dayton, Ohio

5:55 PM: The President and Prime Minister Cameron arrive Dayton, Ohio

6:30 PM: The President and Prime Minister Cameron attend and NCAA Tournament “First Four” game

9:00 PM: The President and Prime Minister Cameron depart Dayton, Ohio en route Washington, DC

10:20 PM: The President and Prime Minister Cameron arrive Joint Base Andrews

10:35 PM: The President and Prime Minister Cameron arrive the Ellipse

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

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Seth's Blog : The mathematical impossibility of universal delight

The mathematical impossibility of universal delight

Jack Nicholson calls it, "rabbit ears."

If you're hyper-aware of what others are thinking, if you're looking for criticism, the unhappy audience member and the guy who didn't get the joke, you will always find what you're seeking.

For it to be any other way, you'd either have to be invisible or performing for a totally homogeneous audience.

Invisible is an option, of course. You can lay low, not speak up and make no difference to anyone.

That's sort of like dividing by zero, though. You'll get no criticism, but no delight either.

As for finding a homogeneous audience, good luck with that. The one thing that's true of all people is that they are different from one another. What delights one enrages the other.

Part of the deal.

 

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luni, 12 martie 2012

Mish's Global Economic Trend Analysis

Mish's Global Economic Trend Analysis


Japan's Debt Disaster and China’s Non-Rebalancing Act: Economic Toxic Brew Portends Currency Crisis

Posted: 12 Mar 2012 02:02 PM PDT

Every country in the world understands the need for global trade rebalancing. Yet, politicians have done nothing but take stances that mathematically cannot work.

Mathematical Impossibilities

  1. Germany wants the rest of Europe to raise exports and become more competitive while simultaneously protecting its export machine and imposing numerous austerity measures on the rest of Europe. Mathematically, it cannot happen.
  2. China wants to wean itself off an export model but does not want the pain associated with  measures that would actually increase domestic demand. Mathematically, it cannot happen.
  3. Japan wants to raise taxes, increase consumer spending, and protect its export model, all at the same time. Mathematically,  it cannot happen.
  4. The US needs to reduce its budget deficit, rein in pension promises, and fix various structural problems (many associated with public unions - the same as in Greece and Spain), but lacks the political will to do so. Mathematically, U.S. deficit spending is not sustainable.

In all four situations above, I have described situations that are mathematically impossible, not just unlikely.

Bug in Search of Windshield

With the world's worst demographics, Japan has no politically acceptable solution to its trade imbalance problem. Japan is a "bug in search of a windshield" as writer John Mauldin puts it.

Global Trade Imbalances Poised to Worsen

With the  above principles in mind, please consider a few snips from an email from Michael Pettis at China Financial Markets regarding "Japan's Debt Disaster and China's Non-Rebalancing Act".
China's current account surplus has declined sharply from its peak of roughly 10% of GDP in the 2007-2008 period to probably just under 4% of GDP last year. Over the next two years the forecast is, depending on who you talk to, either that it will rise significantly, or that it will decline to zero and perhaps even run into deficit. The Ministry of Commerce has argued the latter and the World Bank the former.

I am not sure which way the surplus will go, but I would argue that either way it is going to be a very strained and difficult process for both China and the world. On the one hand if the Ministry of Commerce is arguing, as many do, that the rapid contraction in the surplus indicates that China is indeed rebalancing and will continue to do so, I think they are almost certainly wrong. China is not rebalancing and the decline in the surplus was driven wholly by external conditions. In fact until 2010, and probably also in 2011, the imbalances have gotten worse, not better.

For proof take a look at the graph below sent to me by Calla Weimer, a Visiting Scholar at the US-China Institute, University of Southern California. It shows China's total savings rate as a share of GDP as well as China's total investment rate. As you can see, both numbers are extraordinarily high.




The current account surplus, of course, is equal to the excess of savings over investment – any excess savings must be exported, and by definition the current account surplus is exactly equal to the capital account deficit. This is the standard accounting identity to which I have referred many times in my newsletters.

As the graph shows, the last time investment exceeded savings was in 1993-94, and during that time China of course ran a current account deficit.

So is China rebalancing? Of course not. Rebalancing would require that domestic consumption rise. Is the consumption share of GDP rising? From the graph it is pretty clear that consumption has not increased its share of GDP since the onset of the crisis. If it had, the savings share of GDP would be declining.

And yet savings continue to rise. This is the opposite of rebalancing, and it should not come as a surprise. Beijing is trying to increase the consumption share of GDP by subsidizing certain types of household consumption (white goods, cars), but since the subsidies are paid for indirectly by the household sector, the net effect is to take away with one hand what it offers with the other. This is no way to increase consumption.

What then explains the decline in China's current account surplus over the past three years? The graph makes it pretty obvious. The sharp contraction in China's current account surplus after 2007-08 had was driven by the external sector, and in order to counteract the adverse growth impact Beijing responded with a surge in investment in 2009.

Meanwhile investment continues to grow and, with it, debt continues to grow, and since the only way to manage all this debt is to continue repressing interest rates at the expense of household depositors, households have to increase their savings rates to make up the difference.

Can China's surplus rise further?

Declining trade deficits around the world require declining trade surpluses. Part of the adjustment in Europe I suspect will be absorbed by a contraction in Germany's surplus, but the Germans of course are resisting as much as possible since they, too, are dependent for growth on absorbing foreign demand. I don't know how this will pan out, but certainly Europe as a whole expects its trade surplus to rise, and if instead it begins to run a large deficit, German growth will go negative and the debt burden of peripheral Europe will be harder than ever to bear.

Don't expect Europe, in other words, easily to accommodate China's need for a growing trade surplus. If foreign capital flows to Europe increase – perhaps as China and other BRICs lend money to Europe – Europe's exports will certainly decline relative to imports, but because this means much slower growth for Europe, I don't think it is sustainable.

The problem of Japan

Tokyo is clearly worried that it is running out of time to manage the debt, and the indications are that it has finally become serious about reducing its debt burden. What's more, Japan's current account surplus has already contracted substantially in the past two years, and in January it ran the biggest monthly trade deficit it has ever run – $5.4 billion, although the early Spring Festival this year may have distorted the number.

[Mish comment: For further discussion, please see Japan Faces Moment of Truth: First Annual Trade Deficit Since 1980; New Trend or Simply the Tsunami Effect?]

How can Japan reduce its debt? I am no expert on Japanese policies but according to much of what I am hearing Tokyo is planning to raise taxes further, especially consumption taxes, and to use the proceeds to pay down the debt.

[Mish comment: Japanese government officials without a doubt want to hike taxes. Please consider Japan's Prime Minister Seeks Doubling National Sales Tax; No Winning Play for Japan.

Also consider World's Biggest Economies Face $7.6T Debt Led by Japan $3 trillion, U.S. $2.8 trillion; Rollover Problems in Japan and Europe]

In addition Tokyo and the business community are putting downward pressure on wages in order to increase the competitiveness of the tradable goods sector. The Financial Times article Low wages compound Japan's grim prospects highlights the problem.

Bonuses have been coming under heavy pressure in Japan for years as part of a wider effort to restrain incomes. And while workers around the developed world have been complaining of a squeeze on incomes over the past two decades, in Japan thinner pay packets fuel wider deflation. That makes it even harder for the government to rein in its runaway debt and for the central bank to use monetary policy to boost growth.

Japan Reverses Course


Yikes! This could turn out to be a huge problem for China and the world. Why? Because raising consumption taxes and reducing wages will push up the Japanese savings rate substantially. Either action pushes the growth rate of disposable income down relative to GDP growth, and lower disposable income usually means lower consumption – which is the same as higher savings.

These policies will probably also reduce the investment rate. Lower Japanese consumption, after all, should reduce business profits and so reduce the incentive for expanding domestic production, while pressure for austerity should restrain or even reduce government investment.

By definition more savings and less investment mean that Japan's trade surplus must rise. Japan, in other words, is planning to move backwards in terms of rebalancing.
This Isn't Going to Work

Pettis concludes with "Needless to say this isn't going to work. The 'good news' is that if this conflict leads to much slower global growth, as it certainly will, the resulting reduction in commodity prices, including oil, will help absorb some of the changes in the trade imbalances as commodity exporting countries see their exports fall sharply. But I don't see much other relief."

That bit of "good news" is certainly not good news for the commodity exporting countries like Australia, Canada, and Brazil all of which have their own problems, especially Australia and Canada with enormous property bubbles.

Moreover, Europe is an absolute basket case. Greece, Portugal, and Spain are in economic "depressions". Expect European balance of trade problems to worsen until those countries exit the eurozone. Unfortunately career politicians like German Chancellor Angela Merkel have bet their reputations on preserving the impossible.

Eventually, Germany is going to pay an enormous price for European imbalances and ECB president Mario Draghi's LTRO program, now hailed as an enormous success, is likely to be viewed as anything but success when countries exit the eurozone piecemeal down the road.

Economic Toxic Brew Portends Currency Crisis

As I said upfront, every country in the world understands the need for global trade rebalancing. Yet, politicians have done nothing but take stances that mathematically cannot work, some of which are likely to further exacerbate the problems.

This economic toxic brew will simmer until the pot explodes in a massive currency crisis at some unknown point down the road.

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


Brussels Presses Spain for Budget Details on How Spain Will Reduce Deficit to 3% of GDP; Threatens 2 Billion Euros Fine

Posted: 12 Mar 2012 10:37 AM PDT

EMU officials in Brussels want to see specific details on how Spain will reduce its budget deficit to 3% of GDP in 2013. Given Spain's 2011 deficit was 8.5% of GDP, EMU officials do not believe Spain can meet a goal of 3%, nor should anyone else. The targets will not be met.

Moreover, some in Brussels accuse Spain of artificially inflating the 2011 deficit so as to better meet its interim target.

Those are contradictory accusations actually. If the deficit is artificially inflated, it should be easier to make the targets.

Should Spain come up with the numbers to show it can hit a 3% target in 2013, then the EMU bureaucrats may give Spain some leeway on the dates and interim targets. Otherwise Brussels threatens to fine Spain .2% of GDP, roughly 2 billion euros.

From El Economista via Google Translate: Brussels Presses Spain for Budget Cut Details
The finance ministers of the eurozone on Monday asked the Spanish representative, Luis de Guindos, to announce all the cuts and adjustments Spain will make in budgets this year and next to reduce the deficit from 8.5% in 2011 to 3% in 2013.

If Spain introduces "new and real measures" that will not endanger the fulfillment of the Stability Pact, then the Eurogroup would be willing to negotiate relaxing the deficit target this year (which the Government has placed unilaterally in 5.8% instead of 4.4% agreed with the EU).

However, if De Guindos does "not convince" the EMU that Spain will respect its commitments, the Eurogroup will leave the way open for the Vice President of the Commission responsible for Economic Affairs, Olli Rehn, to reactivate the excessive deficit procedure penalty that could ultimately a fine of up to 0.2% of GDP (about billion euros).

The Eurogroup believes that the prime minister, Mariano Rajoy, has created "surprise" and "much confusion" by announcing unilaterally after the Spring European Council the new deficit target for 2012. The normal thing would have been negotiations with the Commission at the technical level to "seek a solution" with the Eurogroup with "no drama". Rajoy has done the opposite.

"Most of the Eurogroup states are now afraid that the Spanish case sets precedent" just as the EU has just adopted a tightening of the Stability Pact and a new treaty to strengthen fiscal discipline."

The Eurogroup also looks more explanation on the reasons for the budgetary slippage of 2.5 points in 2011, especially considering that "some analysts, say this figure is inflated by domestic political reasons."

EMU officials want detailed and specific measures as to how Spain will reduce its budget deficit from 8.5% to 3%, given an adjustment of 5.5 points is "very difficult".
Spanish unemployment exceeds 23% with youth unemployment at 49%. Austerity measures to further reduce the budget deficit from 8.5% to 3% over two years simply are not realistic.

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


Sarkozy Threatens to Limit Immigration, Delivers Ultimatum to EU, Proposes "Buy European Act"; Help Wanted, French Citizens Only

Posted: 12 Mar 2012 12:39 AM PDT

French President Nicolas Sarkozy delivered an ultimatum to the EU on immigration, complete with a "Buy European Act" and a threat to suspend the Schengen Agreement that allows passport-free travel among 25 European nations.

Hollow Threat for Political Reasons or the Real Deal?

Given how badly Sarkozy trails in recent polls to challenger François Hollande, it's difficult to know for sure if this is some political stunt to revitalize his sinking chances, or if he has really turned isolationist.

Please consider Sarkozy Threatens to Exit Schengen Agreement.
French President Nicolas Sarkozy delivered a stern ultimatum to the European Union at an election rally Sunday, saying he will withdraw France from the Schengen accords, which allow free circulation within most of the bloc's borders, unless the E.U. hardens its immigration policy.

The incumbent president, who is trailing Socialist rival François Hollande in polls, also said that if re-elected he will demand EU partners pass a "Buy European Act" similar to the "Buy American Act" adopted by the U.S. in 1933, which required the government to prefer U.S.-made products in its purchases. Failing significant progress within the year, France will apply the rule unilaterally, he said.

"I want a political Europe that protects its citizens," Mr. Sarkozy said in the largest rally to date of his campaign, with an estimated 50,000 gathered in a hangar at the Paris fair, close to the city's airport.

The French president, who is hoping to kickstart his flagging re-election campaign, said that unless significant progress is made within twelve months to cut the number of foreigners allowed to enter EU borders, France will leave the Schengen area, a move that would deal a blow to the free circulation of people within the union.

"At a time of economic crisis, if Europe doesn't pick those who can enter its borders, it won't be able to finance its welfare state any longer," he told the rally. "We need a common discipline in border controls...We can't leave the management of migration flows to technocrats and tribunals."
To help translate what Sarkozy is really saying, please consider the following map of the Schengen Agreement area.

Schengen Agreement Countries



"Buy France"

That pretty much looks like Europe to me, minus the UK, Ireland, and trade-insignificant Eastern Europe. Thus, my take is Sarkozy is really saying is "Buy France".

How well does that bode for the survival of the Eurozone?

One of the major weaknesses of the EMU, aside from the all-important lack of a fiscal union is language barriers. To help understand the significance, compare California to Greece.

In the United States, someone in California can easily move and take a job in Texas or seek better opportunities in any of 50 states.

However, it's safe to say the average Greek does not speak Finnish, German, and French even if the average person is multilingual. For someone in Greece seeking better opportunities elsewhere in the Eurozone, linguistic barriers are monumental. So are cultural barriers, and so are issues related to national pride.

Help Wanted, French Citizens Only

Sarkozy, has now threatened to take those already huge difficulties one step further with a policy that is tantamount to "Help Wanted, French Citizens Only".

These are exactly the kinds of disputes that ensure that the eurozone as constructed cannot possibly survive.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
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Damn Cool Pics

Damn Cool Pics


The Radical Growth of the App Economy [Infographic]

Posted: 12 Mar 2012 05:08 PM PDT



A recent study came out in which it was estimated that developing mobile applications accounted for nearly half a million new jobs on the market—a statistic I find absolutely staggering. It goes to show that seemingly small things can have an enormous impact on the economy.

This infographic lays out a few more statistics on the developing "app economy," and also has some helpful tips on what apps can help readers with smartphones save money. My personal favorite is GasBuddy, which locates the where in your neighborhood gas prices are cheapest—something I've been finding more and more useful as gas prices climb. Check out the infographic in full below.

Click on Image to Enlarge.

Via: frugaldad


What You Need to Know to Get Over Acne [Infographic]

Posted: 12 Mar 2012 02:12 PM PDT



Getting treatment for your acne can be a tough decision. Do I buy over the counter? Do I see a doctor? Do I change my diet? These are all of the things we set out to answer to help you try to make the right decision. Let us try to help you answer these questions.

Click on Image to Enlarge.

Via: acnetreatment