luni, 12 noiembrie 2012

Seth's Blog : When you don't know what to do...

 

When you don't know what to do...

That's when we find out how well you make decisions.

When don't don't have the resources to do it the usual way, that's when you show us how resourceful you are.

And when you don't know if it's going to work, that's how we find out whether or not we need you on our team.

Making instructions is harder than following them.



More Recent Articles

[You're getting this note because you subscribed to Seth Godin's blog.]

Don't want to get this email anymore? Click the link below to unsubscribe.




Your requested content delivery powered by FeedBlitz, LLC, 9 Thoreau Way, Sudbury, MA 01776, USA. +1.978.776.9498

 

6 people you might know on Google+

Hi Mihai!
Here are some people you might know on Google+.
Google+ team
Suggestions for youView all suggestions
Add to circles
alinaconstantinescu.ro
Add to circles
Canal IP
Add to circles
artist-plastic, poet
Add to circles
Suiugan Anca
Add to circles
Add to circles
The most popular content on Google+View what's hot
Why there is zero chance that my next pizza order will be with Papa Johns; CEO cutting workers to avoid health care.
Papa John's CEO: Obamacare likely to raise costs, result in employee's hours being cut
"That's what you do, is you pass on costs,' John Schnatter told Edison State College students on Wednesday. 'Unfortunately, I don't think people know what they're going to pay for this."
+432 - 363 comments - 61 sharesView or comment on this post »
This notification was sent to e0nstar1.blog@gmail.com.Don't want occasional updates about Google+ activity and friend suggestions? Change what email Google+ sends you.Google+ team

duminică, 11 noiembrie 2012

Mish's Global Economic Trend Analysis

Mish's Global Economic Trend Analysis


Japan Plunges Into Deep Recession; GDP Shrinks 3.5% Annualized; Japan Current Account Turns Negative First Time in 30 Years; Watch the Yen

Posted: 11 Nov 2012 11:03 PM PST

The global economy took another turn for the worse as Japan plunged into recession following two consecutive quarters of growth.

Please consider Japan's economy shrinks annualized 3.5%.
Japan's economy shrank an annualised 3.5 per cent between July and September, the steepest decline since the earthquake-hit first quarter of 2011, as exporters suffered big falls in shipments to key markets such as China and Europe.

Prime Minister Yoshihiko Noda described the gross domestic product figures as "severe", while Seiji Maehara, economy minister, said Japan had possibly entered a "recessionary phase".

In a speech on Monday, Masaaki Shirakawa, Bank of Japan governor, said there was "no question that the [central bank] should exert every effort to enhance its easing effects as much as possible". He said domestic demand was "unlikely to increase at a pace that will outperform the weakness in exports".

The Japanese government's monthly survey of "economy watchers" – which includes barbers, hoteliers, car dealers and others who deal with consumers – has recorded six falls in a row since April. Last month the index stood at a level little better than that of April 2011, in the immediate aftermath of the quake.

Japanese manufacturers from Nissan to Shiseido have reported steep falls in sales of their products in China, following a wave of demonstrations against Tokyo's nationalisation of some of the islands in mid-September.

Japan's top seven automakers have cut their projections for Chinese sales by a fifth, for the fiscal year to March, according to calculations by the Nikkei newspaper.
Japan Trade Deficit Largest in History

As Japan spirals out of control, please recall Japan trade deficit hits record as relations with China poisoned.
Japan registered its biggest-ever trade deficit for a half of a fiscal year, in a sign that the sovereign debt crisis in Europe and the strained relationship with China over a territorial dispute have eroded Japanese exports, government data showed today.

For the first half of fiscal 2012 through September, Japan logged about USD 40.6 billion (3,219 billion yen) in goods trade deficit, up 90.1 percent from a year earlier and the biggest since the Finance Ministry began recording in 1979.

In September alone, the deficit stood at 558.6 billion yen, the third straight month of red ink and the largest for the month of September, the ministry said in a preliminary report, augmenting fears that violent anti-Japan rallies and boycotting of Japanese products in China have weighed on the exports to the biggest trading partner.

Exports to China fell 8.2 percent to 5,921.1 billion yen in the first half and slid 14.1 percent to 953.8 billion yen in September, sharper than the 9.9 percent fall in August. It was the fourth consecutive month of deficit as various products, ranging from auto and auto parts to steel and semiconductors, declined notably.

The balance showed Japan suffered the biggest September deficit with China of 329.5 billion yen, as imports gained 3.8 percent to 1,283.3 billion yen.

Resentment in China has accelerated since the Japanese government decided last month to nationalize part of an island group in the East China Sea, also claimed by Beijing and Taiwan.
Japan Current Account Turns Negative

The trick for Japan is how to finance its national debt, now at a majorly unsustainable 235% of GDP.

Japan was able to do so for years on account of its current account surplus, of which trade is typically the largest component.

You can now kiss that surplus goodbye because Japan Current Account Turns Negative
The world's third-largest economy has run a surplus in its current account, a measure of trade in goods, services and investments, for several decades—meaning it's earning more from exports and investments abroad than it spends at home. In fact, Japan the world's biggest creditor nation.

The surplus has been in the spotlight recently, since Japan also has the developed world's biggest debt load, now nearing a quadrillion yen ($12.5 trillion)—more than double its gross domestic product. As long as the current account surplus remains, economists say, Japan is in little danger of a Greek-style crisis, since its debt is largely being funded by household savings.

While that remains the case, Japan reported Thursday that the seasonally adjusted current-account was in deficit in September—for the first time in more than 30 years. The sudden surprise drop has some economists warning that Japan's ability to generate wealth is eroding faster than expected, and its fiscal situation could be more fragile than many had thought.

The Finance Ministry says Japan won't slip into a structural current-account deficit very easily, since deficits in the trade of goods and services will be offset by huge surpluses in what the country earns on investments in overseas assets such as U.S. Treasury bonds.

But the Japan Center for Economic Research argues a structural deficit in could be as close 2017, noting fuel-import levels are likely to stay high if most nuclear plants stay off.

The Japan Research Institute, another think tank, says a structural deficit could start in 2022 if crude oil prices keep rising. Hideki Matsumura, an economist with the institute, said it could come earlier if the current strong-yen trend, which hurts Japan's ability to sell overseas, continues.

"Many countries are catching up with Japan in the manufacturing field," he said. "If they can produce similar products for a cost 20% to 30% less than Japanese do, Japan will soon find no demand for its products."
Bug in Search of Windshield

As my friend John Mauldin suggests, Japan is a bug in search of a windshield. I highly doubt Japan can make it 2022 or even 2017 before it runs into serious issues.

Actually, Japan has extremely serious issues already, it's just that the market is ignoring them for now. If interest rates rise by a mere 2% or so, interest on the national debt will consume 100% of Japanese tax revenue.

Global imbalances are mounting. I suspect within the next couple of years (if not 2013) Japan will resort to the printing press to finance interest on its national debt and the Japanese central bank will start a major currency way with all its trading partners to force down the value of the yen.

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


Corporate Bankruptcies Soar in Australia; Just a Start of What's Coming

Posted: 11 Nov 2012 05:08 PM PST

Nearly every day I receive emails from "Brisbane Bear" regarding the sorry state of affairs in Australia. Here is another one to consider: Insolvencies for quarter near record high
CORPORATE insolvencies hit their second-highest peak on record in the last quarter, as the aftershocks of the global financial crisis continued to flow through the market, The Weekend Australian's Anthony Klan reports.

According to the Australian Securities & Investments Commission, there were 2552 insolvencies in the three months to September, which was up 10 per cent on the previous quarter.

In last year's September quarter, total insolvencies reached a peak after 2961 companies hit the wall.

"All states and territories except the Australian Capital Territory experienced a rise in insolvency appointments compared to the previous quarter," ASIC executive leader of insolvency practitioners Adrian Brown said.

According to ASIC, all types of insolvency were up on the previous quarter, led by voluntary administrations (up 17.2 per cent) and receiverships (up 13 per cent).

Court-ordered liquidations rose 9.2 per cent in the quarter and director-initiated voluntary liquidations were up 7.8 per cent, according to ASIC.

Receivership appointments were driven by rises in NSW and Victoria, up 25.4 per cent and 14.7 per cent respectively.

In the past three months, voluntary administrations soared 37 per cent in Queensland, followed by Victoria, which was up 19 per cent.

Mortgage funds such as Provident Capital and Banksia Securities were among the highest-profile collapses in the past quarter, owing investors almost $800 million combined.
Just a Start of What's Coming

I expected this action as did Brisbane Bear who writes "Brisbane is the capital of Queensland so it's no wonder I am so bearish!"

For a detailed look why this was easily foreseen (notably the China connection and Australia's housing bubble), please see




The Reserve Bank of Australia, Australian housing bulls, and most economists (Steve Keen a notable exception), did not see this coming.

The Reserve Bank of Australia expects all to be well next year.

Implications

I suggest this is the beginning.

Australia's housing bust will smash the commercial real estate market, and the commodity slowdown in China is icing on the cake.

The Australian dollar is stubbornly high in the face of these problems, but don't expect that to last.

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


Spain Declares 2-Year Moratorium on Evictions Following Suicides; Policy Will Blow Up Spectacularly

Posted: 11 Nov 2012 09:29 AM PST

El Pais (via Google translate) reports Government will give a two-year moratorium to end evictions.
Social pressure, political and, above all, the shock of facts so overwhelming as two suicides in recent weeks, the second on Friday, has led the government and the PSOE to move faster. Both contacts for accelerated progress towards an agreement to halt evictions more extreme than in any case, will not materialize until next week. That agreement, however, will not be retroactive and would apply to mortgages signed, but not those that are in foreclosure. It would not serve to cases like Egaña Amaya, the woman who committed suicide in Barakaldo.

The Prime Minister, Mariano Rajoy, solemnized the idea during an election rally in Lleida: "These days we see terrible things, inhuman situations, a person committed suicide when she would be evicted. It is a difficult subject, you have to take it with all seriousness and humanity. The government is talking to many people, we talked this morning with the PSOE. I hope we can talk on Monday of the temporary cessation of evictions affecting the most vulnerable families. And the threshold of exclusion, to better implement the code of good practice, so you can renegotiate the debt and remain in housing. It is a difficult subject, I hope we can give good news to the whole of the Spanish."

Policy Will Blow Up Spectacularly

The problem with an eviction moratorium should be obvious. People will have no incentive to pay their mortgages for the next two years. Many people will take that option and it will further stress the Spanish banking sector already deep in trouble.

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


Seth's Blog : You can't argue with success...

 

You can't argue with success...

Of course you can. What else are you going to argue with? Failure can't argue with you, because it knows that it didn't work.

The art of staying successful is in being open to having the argument. Great organizations fail precisely because they refuse to do this.



More Recent Articles

[You're getting this note because you subscribed to Seth Godin's blog.]

Don't want to get this email anymore? Click the link below to unsubscribe.




Your requested content delivery powered by FeedBlitz, LLC, 9 Thoreau Way, Sudbury, MA 01776, USA. +1.978.776.9498

 

sâmbătă, 10 noiembrie 2012

Mish's Global Economic Trend Analysis

Mish's Global Economic Trend Analysis


Prepare for Demise of California; Liberals Will Get All the Government (and Tax Hikes) They Want

Posted: 10 Nov 2012 10:12 AM PST

On Tuesday voters in California went the wrong way on three propositions.

  1. Voters approved Proposition 30 "temporarily" increasing the state sales tax and income tax on individuals making over $250,000.
  2. They voted against Proposition 31 that would allow the governor to cut the budget in fiscal emergencies.
  3. They voted against Proposition 32 that would prevent unions from making campaign donations via members' dues.

Moreover, and worse yet, Democrats picked up two more votes in the state legislature giving them a supermajority, capable of passing any tax hikes they want.

Those results are so awful I suggest you prepare for the demise of California.

Indeed California's Liberal Supermajority is about to run the state into the ground and taxpayers are going to get all the government they ever wanted.
The main check on Sacramento excess has been a constitutional amendment requiring a two-thirds majority of both houses to raise taxes. Although Republicans have been in the minority for four decades, they could impose a modicum of spending restraint by blocking tax increases. If Democratic leads stick in two races where ballots are still being counted, liberals will pick up enough seats to secure a supermajority. Governor Jerry Brown then will be the only chaperone for the Liberals Gone Wild video that is Sacramento.

The high Democratic turnout in moderate and right-leaning districts helped the party pick up three seats in the senate and four in the assembly.

So now Californians will experience the joys of one-party, union-run progressive governance. Mr. Brown is urging lawmakers to demonstrate frugality and the "prudence of Joseph." As he said the other day, "we've got to make sure over the next few years that we pay our bills, we invest in the right programs, but we don't go on any spending binges." That's what all Governors say. Trouble is, merely paying the state's delinquent bills will require tens of billions in additional revenues if lawmakers don't undertake fiscal reforms.

With no GOP restraint, liberals can now raise taxes to pay for all this. [$200 billion in unfunded liabilities, the California State Teachers' Retirement System in need of $10 billion annually for the next 30 years to amortize its debt, $73 billion in outstanding bonds for capital projects and $33 billion in voter-authorized bonds, etc.]

They'll probably start by repealing Proposition 13's tax cap for commercial property. Democrats in the Assembly held hearings on the idea this spring. Then they'll try to make it easier for cities to raise taxes.

The greens want an oil severance tax. Other Democrats want to extend the sales tax to services, supposedly in return for a lower rate, but don't expect any "reform" to be revenue neutral. Look for huge union pay raises and higher pension benefits.

The silver lining here is that Americans will be able to see the modern liberal-union state in all its raw ambition. The Sacramento political class thinks it can tax and regulate the private economy endlessly without consequence. As a political experiment it all should be instructive, and at least Californians can still escape to Nevada or Idaho.
Law of the Funnel in Action

Big government and absurdly strong unions destroyed Greece and Spain. Expect no less for California.

Many large California corporations that can flee, will flee. Those stuck in California will see massive tax hikes (with many more to come) just so public unions and administrators can collect absurdly high salaries and benefits that most citizens can only dream about.

Please see the Law of the Funnel for a description as to what just happened.

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

"Wine Country" Economic Conference Hosted By Mish
Click on Image to Learn More




Economists Cut US GDP Forecast, Raise Inflation Forecast

Posted: 10 Nov 2012 08:44 AM PST

Here is a headline news story that I found interesting for reasons I will explain following: Economists cut U.S. Q4 growth forecasts.
Economists expect the economy to grow at an annual rate of 1.8 percent in the current quarter, down from the previous estimate of 2.2 percent growth, according to the Philadelphia Federal Reserve's fourth-quarter survey of 39 forecasters.

While that left estimates for gross domestic product for the year unchanged at 2.2 percent, growth in 2013 looked modestly weaker with economists forecasting 2 percent, down from 2.1 percent.

Over the next three quarters, growth was seen averaging 2.1 percent, down from earlier expectations of 2.2 percent.

The unemployment rate was forecast to come in lower than expected, averaging 7.9 percent in the fourth quarter from the previous estimate of 8.1 percent. The monthly unemployment rate released by the government was 7.9 percent in October.

Still, unemployment was seen stuck at 7.9 percent in the first quarter of next year, and holding at 7.8 percent in the second and third quarters.

Economists raised their forecasts for inflation this quarter with the headline consumer price index seen averaging 2.3 percent, up from earlier estimates for 2.0 percent. For the year, CPI was expected to average 1.9 percent, up from 1.8 percent.
Given exports were recently revised up and imports revised lowered, I expected economists to think GDP would come in higher. It would have been interesting to see their reasons. Hurricane Sandy perhaps?

I expect the economy to weaken of course (and by far more in 2013 than the economists). Curiously the economists do not seem worried about the alleged fiscal cliff, at least for their GDP estimates.

For more on the fiscal cliff, please see "Saturation Point" for QE Nonsense; Fiscal Cliff Comparisons.

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