Central Perk

duminică, 28 iulie 2013

Mish's Global Economic Trend Analysis

Euro Sucks Italian Blood; Prime Minister Blames Tax Evasion; Reflections on Italy's Shadow Economy

Posted: 28 Jul 2013 10:57 AM PDT

This summer a private air plane has been flying over Italian beaches with a banner message Euro is Sucking Italian Blood

The article states "Italians have only one solutions to fight against this situation : leave Italy."

No End in Sight to Italy's Economic Decline

Der Spiegel says No End in Sight to Italy's Economic Decline

The Italian economy may be the third largest in the euro zone, but it is also plagued by inefficiency and continues to shrink. The country's political leadership has proven unable to implement badly needed reforms and the future looks grim.

Italy, despite being the third-largest economy in the euro zone after Germany and France, finds itself in dire straits, having been in decline for years. Its GDP has dropped by 7 percent since 2007. The last few years, says Gianni Toniolo, an economics professor in Rome, represent "the worst crisis in (the country's) history," even more devastating that the period between 1929 and 1934.

Some sectors have lost even more capacity, with the automobile industry having declined by 40 percent. According to Paolazzi, Italy is experiencing an "unprecedented process of deindustrialization."

But why?

Wages aren't the problem. They are 15 percent lower than Belgian and French wages and 30 percent lower than wages in Germany, according to a current Bank of Italy comparison. But according to Confindustria, the Italian economy faces a tax burden that is 20 percent higher than in Germany. And unit labor costs are about 30 percent higher than German levels, say central bank officials.

The CGIA research institute in Mestre, near Venice, found that one in two small businesses was only able to pay its employees in installments. Three out of five companies are forced to take out loans to pay their high tax bills.

In addition to the tax burden, a bloated bureaucracy obstructs almost all economic activity, an inefficient judiciary deters potential investors with trials that can last for decades. Italy has a relatively low education level and a poor infrastructure characterized by potholed streets, an energy supply prone to failure, constantly delayed trains and outmoded communication networks.

As a result, Italy continues to fall behind internationally as a place to invest. It is now 44th in the World Competitiveness Center (WCC) ranking, below the Philippines, Latvia, Russia and Peru, and only slightly above Spain and Portugal.

Populists like Berlusconi and the founder of the "Five Star" protest movement, Beppe Grillo, are not the only ones advocating the most radical of all solutions for Italy's problems. The country has "a lot of vitality and great potential," says US economist and policy advisor Allen Sinai, but it can only benefit from these strengths "by withdrawing from the euro."

Structural Problems

The Euro is clearly a problem, but leaving the Euro without fixing the other structural problems will not fix anything.

Letta Declares War on Tax Evasion

The Telegraph reports Italian Prime Minister Enrico Letta pledges war on tax evasion

Italian prime minister Enrico Letta pledged Wednesday to "fight relentlessly" against tax evasion in the recession-hit country, as the government pushed new growth measures through the lower house of parliament.

Letta blamed Italy's underground economy - which ranges from simple tax evasion to organised crime and accounts for some 25 percent of the overall economy according to most studies - for damaging competitiveness.

Reflections on Italy's Shadow Economy

Letta has things ass backwards. Tax evasion and the underground economy is not destroying Italy. Rather, Italy's massive underground economy is a symptom of the dysfunctional nature of the real economy.

The underground economy thrives because of high taxes, poor infrastructure, political favoritism, and inane labor rules.

A crackdown on tax evasion (a symptom of the problem, not the problem) will only make matters worse.

Only Hope is Bankruptcy

For more on Italy, please note the opinion of Enrico Colombatto, Professor of Economics at the University of Turin who says "Only Hope For Italy is Bankruptcy".

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

Seth's Blog : Perhaps you could just make something awesome instead

Perhaps you could just make something awesome instead

Mass marketers love the promise of big data, because it whispers the opportunity of once again making average stuff for average people, of sifting through all the weird to end up with that juicy audience that's just waiting to buy what they've made.

Big data is targeting taken to the highest level of granularity. It grabs your behavior across web sites, across loyalty cards, who knows, across your phone records... the promise of all this grabbing is that marketers will be able to find precisely the right person to reach at the right moment with the right offer.

[Worth noting that the flipside--the ability to reach the weird and offer them something that would never be practical otherwise--is a breakthrough just waiting to happen.]

And the rocket scientists are busy promising Hollywood that they can run the numbers on a script and figure out how to change it to make it more likely to sell. Add a sidekick to that superhero, perhaps, or have that demon be summoned instead of whatever it is that unsummoned demons do...

This rearview window analysis is anethema to the creative breakthrough that we call art. No amount of digital focus group research could figure out that we wanted Memento or the Matrix or Amour. Worse, it's based on the flawed assumption that the past is like the future, that correlation and causation are related. By that analysis, every Supreme Court chief justice, US president and New York City police chief is going to be a man. Forever more.

We are going to get ever better at giving committees ways to turn your work into banality. That opens up the market even more for the few that have the guts to put great work into the world instead.

• Email to a friend •

sâmbătă, 27 iulie 2013

Mish's Global Economic Trend Analysis

Farm Robots to Make Migrant Worker Vegetable Pickers Obsolete; Welcome the "Lettuce Bot", the "Grape Bot", the "Strawberry Bot"

Posted: 27 Jul 2013 11:16 AM PDT

The migrant worker agricultural jobs that few legal US citizens are willing to do for the price farmers are willing to pay will vanish within a decade as robots will soon be able to perform even those tasks cheaper.

Welcome the "Lettuce Bot", the "Grape Bot", the "Strawberry Bot"

Time reports Robots to Revolutionize Farming and Ease Labor Woes.

On a windy morning in California's Salinas Valley, a tractor pulled a wheeled, metal contraption over rows of budding iceberg lettuce plants. Engineers from Silicon Valley tinkered with the software on a laptop to ensure the machine was eliminating the right leafy buds.

The engineers were testing the Lettuce Bot, a machine that can "thin" a field of lettuce in the time it takes about 20 workers to do the job by hand.

The thinner is part of a new generation of machines that target the last frontier of agricultural mechanization – fruits and vegetables destined for the fresh market, not processing, which have thus far resisted mechanization because they're sensitive to bruising.

Researchers are now designing robots for these most delicate crops by integrating advanced sensors, powerful computing, electronics, computer vision, robotic hardware and algorithms, as well as networking and high precision GPS localization technologies. Most ag robots won't be commercially available for at least a few years.

On the Salinas Valley farm, entrepreneurs with Mountain View-based startup Blue River Technology are trying to show that the Lettuce Bot can not only replace two dozen workers, but also improve production.

"Using Lettuce Bot can produce more lettuce plants than doing it any other way," said Jorge Heraud, the company's co-founder and CEO.

The Lettuce Bot uses video cameras and visual-recognition software to identify which lettuce plants to eliminate with a squirt of concentrated fertilizer that kills the unwanted buds while enriching the soil.

Blue River, which has raised more than $3 million in venture capital, also plans to develop machines to automate weeding – and eventually harvesting – using many of the same technologies.

Another company, San Diego-based Vision Robotics, is developing a similar lettuce thinner as well as a pruner for wine grapes. The pruner uses robotic arms and cameras to photograph and create a computerized model of the vines, figure out the canes' orientation and the location of buds – all to decide which canes to cut down.

In southern California, engineers with the Spanish company Agrobot are taking on the challenge by working with local growers to test a strawberry harvester.

The machine is equipped with 24 arms whose movement is directed through an optical sensor; it allows the robot to make a choice based on fruit color, quality and size. The berries are plucked and placed on a conveyor belt, where the fruit is packed by a worker.

End of the Migrant Worker

Natural News reports Farm robots to make human ag workers obsolete within a decade.

Technology is about to take over America's fruited plains - robots, it seems, are all the rage down on the farm, and their introduction and spread will make human farm work a thing of the past.

Right now hordes of migrant workers tend to "America's Salad Bowl," located in sunny California, as they have for the past 100 years. But the coming machines will usher in the end of an era.

And many farmers are welcoming the technological advances. They see bots as easing the illegal immigration problem, increasing productivity at less cost (which could be passed onto consumers even as farm profits are bolstered), boost quality and provide a more consistent product.

"Almost three-fourths of all U.S. hired farm workers are immigrants, most of them unauthorized. The U.S. food system - particularly fruit and vegetable production - depends on immigrants more than any other sector of the U.S. economy," says a report by the Bread for the World Institute.

Robots will cost plenty - for the largest farming operations, millions of dollars - but farm operators say the expense will be worth it.

Still, there is much research and development to be done. Right now, bots - machines in general - are clumsy and bulky. They are not always able to detect when fruit and vegetables are ready to be harvested or picked. They can't always detect between produce and leaves. And they don't have the dexterity of a seasoned farm worker.

Machinery and machine technology has made farming easier and more efficient for centuries. The development continues.

Two Predictions

Technology will improve much faster than currently estimated
By the time Congress addresses the illegal immigrant problem, the nature of the problem will have radically changed

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

Payroll Employment for Age Group 18 to 29 Shows Fewer Full-Time Employment "Regardless of Education"

Posted: 27 Jul 2013 12:07 AM PDT

A Gallup Poll on US Payroll Employment for Age Group 18 to 29 shows Fewer Young Adults Holding Full-Time Jobs in 2013.

Fewer Americans aged 18 to 29 worked full time for an employer in June 2013 (43.6%) than did so in June 2012 (47.0%), according to Gallup's Payroll to Population employment rate. The P2P rate for young adults is also down from 45.8% in June 2011 and 46.3% in June 2010.

Younger Americans Less Likely to Have Full-Time Work Now, Regardless of Education

Older Americans More Likely to Hold Full-Time Jobs Now Than a Year Ago

The lack of new hiring over the past several years given a recovering economy seems to have disproportionately reduced younger Americans' ability to obtain full-time jobs. On the other hand, Americans aged 30 to 49 this June were, at 61.4%, about as likely to have a full-time job as they were in June of each of the prior three years.

The percentage of Americans aged 50 to 64 who have a full-time job increased in June 2013, to 48.2%, from 46.6% a year ago and 45.7% in June 2010. Similarly, 8.4% of Americans 65 or older had a full-time job in June 2013, compared with 7.2% in June 2012 and 6.2% in June 2010.

The slow economy of recent years has limited new hiring. This has likely increased the percentage of older Americans with jobs, as companies may be placing a greater value on their experience and productivity and as older workers decide to continue to work when given the opportunity to do so. It also may suggest that far fewer workers are retiring voluntarily. In turn, this may imply that the current labor participation rate will increase, as those who involuntarily left the workforce return in greater numbers than expected once the U.S. economy begins to grow significantly.

These results are not surprising. Here is a snip from my May 1, 2008 post on the Demographics Of Jobless Claims

Ironically, older part-time workers remaining in or reentering the labor force will be cheaper to hire in many cases than younger workers. The reason is Boomers 65 and older will be covered by Medicare (as long as it lasts) and will not require as many benefits as will younger workers, especially those with families. In effect, Boomers will be competing with their children and grandchildren for jobs that in many cases do not pay living wages.

Social Security Cliff in Sight

And so here we are. Boomers are competing with their children and grandkids for jobs. Demographics are awful. And the ramifications of an aging workforce with fewer workers than ever vs. retirees puts stress no only on public union pension plans, but also on Social Security.

For further discussion, please see Social Security Cliff in Sight; Retirees Will Outlive Trust Fund; Ramifications of Nonmarketable IOUs and Privatization

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

More personal pins and a privacy policy update

We've added a few new tools to help you see more pins you like, and fewer pins you don't, when you come to Pinterest. Over the next few weeks, you'll be able to:

Quickly edit your home feed.
Use the Edit button to get your home feed just how you want it. Go to Follow Boards to see boards you might want to follow based on stuff you've already pinned and popular boards on Pinterest. Or, go to Unfollow Boards to stop seeing pins from boards you're not that into anymore. You can edit from the web or your phone—try it out!

See more personalized pins.
If you're interested, we'll suggest pins and boards based on info like websites you've visited and things you've pinned. So if you're planning a party and have gone to lots of party sites or pinned party-themed decorations, we'll try to suggest pins to make your event a hit.

You can learn more about personalized pins in our Help Center or updated privacy policy. Or if you're not interested, you can easily change your account settings. And of course, we also respect Do Not Track.

We'll keep working hard to make your home feed a little better. In the meantime, please let us know how you feel about the new tools!

—The Pinterest Team

Happy pinning!

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A Better Bargain for the Middle Class

Featured

A Better Bargain for the Middle Class

In this week’s address, President Obama tells the American people about his speech at Knox College on Wednesday, where he discussed the cornerstones of what it means to be middle class, including having a good job, a home that is your own, quality education, a secure retirement, and affordable health care.

Watch this week's Weekly Address.

Top Stories

NCAA Champions: On Tuesday, President Obama welcomed the NCAA Champion Louisville Cardinals to the White House. President Obama, an avid basketball fan, celebrated the team’s accomplishments both on and off the court – praising their cumulative 3.3 grade-point-average, the thousands of dollars they helped raise for charity, and their determination, despite physical obstacles, to win the men’s NCAA title.

Vice President and Dr. Biden in India: The Vice President and Dr. Biden traveled to India and Singapore, as part of their six-day trip – meeting with leaders and visiting schools and aid workers to discuss the important opportunity to strengthen our partnerships within the region and reaffirm our commitment to rebalancing U.S. foreign policy toward the Asia-Pacific. When they arrived in New Delhi on Monday, they visited Mahatma Gandhi’s granddaughter and toured the Gandhi Smriti museum.

On Tuesday, the Vice President met with Indian Prime Minist Dr. Manmohan Singh, President Pranab Mukherjee, and Vice President Hamid Ansair. The leaders discussed the relationship between the United States and India. Later, Vice President Biden spoke at a dinner hosted by Indian Vice President Hamid Ansari, where he spoke about the importance of the partnership between the two countries. During the day, Dr. Biden visited the settlement of Kachhpura, where USAID Health and Urban Poor Program has been stationed since 2011.

Speaking from the Bombay Stock Exchange on Wednesday, the Vice President spoke about moving both the U.S. and Indian economies forward – noting that American interests were very similar to Indian interests. Dr. Biden hosted a roundtable discussion to hear more about how groups are working to improve nutrition in India and visited The Dilaasa Crisis Intervention Department for Women, a center for female survivors of domestic violence.

Women at the Indian Institute of Technology met with Vice President Biden on Thursday for a roundtable discussion. The Vice President spoke about the importance of engaging women in science, technology, and engineering and explained what the U.S. is doing to promote STEM in the United States. Dr. Biden visited an all-girls school, where she taught a grammar lesson.

National Council of La Raza: First Lady Michelle Obama spoke to more than 1,800 people at the National Council of La Raza’s Annual Conference on Tuesday, highlighting the importance of healthy eating, while keeping in mind the tradition and culture behind food. “While food might be love, the truth is that we are loving ourselves and our kids to death,” the First Lady said. “So we need to step up. We need to own this as a serious problem in our communities.”

#ABetterBargin: Kicking off a series of speeches about the economy, President Obama boarded Air Force One on Wednesday and took off for the Midwest. His first stop was Knox College in Galesburg, Illinois – the place he made his first speech on the economy after being elected as U.S. Senator back in 2005; the President also traveled to the University of Central Missouri. At both events, the President discussed the economic progress we have made in the last five years, and encouraged Americans that we’re not done yet.

“As a country, we’ve recovered faster and gone further than most other advanced nations in the world. With new American revolutions in energy and technology and manufacturing and health care, we're actually poised to reverse the forces that battered the middle class for so long, and start building an economy where everyone who works hard can get ahead.

But -- and here's the big “but” -- I’m here to tell you today that we're not there yet. We all know that. We're not there yet. We've got more work to do.”

Instagram: While President Obama was preparing to head to Illinois, the Chief Official White House Photographer, Pete Souza, launched his own Instagram account – giving followers a behind-the-scenes look at the presidency. Follow his Instagram here, and then go follow the official Instagram accounts for the White House and First Lady Michelle Obama.

Meeting with the President of Vietnam: President Truong Sang of Vietnam visited the White House on Thursday for a bilateral meeting with President Obama in the Oval Office. The leaders discussed the Trans-Pacific Partnership and other ways the U.S. and Vietnam can work together to create jobs in both countries.

Talking Infrastructure: Reiterating his speeches on the economy in the Midwest the day before, the President visited Jacksonville, Florida on Thursday. The President said,

“We’ve got to help more manufacturers bring more jobs back to America. We’ve got to keep creating good jobs in manufacturing. We’ve got to create good jobs in wind and solar energy. We’ve got to tap into this natural gas revolution that’s bringing energy costs down in this country, which means manufacturers now want to locate here because they’re thinking that we’ve got durable, reliable supplies of energy. We’ve got to create more jobs today doing what you’re doing right here at JAXPORT -- and that’s building this country’s future.”

Iftar Dinner: Muslim Americans were invited to the White House on Thursday night to celebrate an Iftar dinner. President Obama, who has hosted this event for five years, thanked the community for their contributions to the United States.

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Seth's Blog : Millions of words and only six emotions

Millions of words and only six emotions

The intellectual part of the human mind can spin delightful or frightening stories, can compare features and benefits, can create narratives that compel us to take action.

But all of these words are merely costumes for the six emotions built deep in our primordial soup:

Anger, disgust, fear, happiness, sadness and surprise.

Being angry at a driver who cuts you off in traffic is chemically similar to being angry to a relative you cuts you out of his will. We tell ourselves different stories (the traffic story will probably not last nearly as long in the echoes of our consciousness as the bitterness of the bequest story, for example), but still, there are only six buttons being pressed.

Knowing that there are only a few keys on the keyboard doesn't make it easier to write a pop hit or a great novel, but it's a start. In the case of someone with an idea to spread or a product to sell, knowing that you've only got six buttons might help focus your energy.

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vineri, 26 iulie 2013

Mish's Global Economic Trend Analysis

Funniest and Most Absurd Real Estate Promotion in Years

Posted: 26 Jul 2013 11:00 AM PDT

Those attending the iProperty.com International Property Expo in Singapore, to learn about "the best property in Asia" can win a free house by attending.

Guess where the house is located.

One might think somewhere in Asia because that's the focus of the expo. But No! The free house is located in the mother of all choice spots, Detroit, Michigan.

Check out the image.

Note the creative description: "Yes, it's true we are giving away a home! This is a gorgeous 3 bedroom brick home located in an excellent neighbourhood just a stone's throw away from key facilities like the Triumph Hospital and the Bel Air Shopping Centre. It boasts a garage and basement and has just been newly furnished. It's Freehold Landed U.S property with 3 bedroom and 1 bathroom. A lot size of 4,225 sq ft with Garage, basement and tenant included! This property has a net selling price US $38,000."

Is this ad supposed to entice people to attend or scare them away?

It's Too Late

The iProperty promotion clearly needs a nice corresponding "better buy now before it's too late" message.

And I have just the right promotional idea in mind. It's from my December 13, 2005 article It's Too Late.

I think it's too late.
In fact I know it's too late.
How do I know?
The following Email I received tonight should explain it nicely.
When you see stuff like this, not only is it too late, it's way too late.

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

Spain Levies Consumption Tax on Sunlight

Posted: 26 Jul 2013 01:03 AM PDT

Proving that idiocy truly has no bounds, Spain issued a "royal decree" taxing sunlight gatherers. The state threatens fines as much as 30 million euros for those who illegally gather sunlight without paying a tax.

The tax is just enough to make sure that homeowners cannot gather and store solar energy cheaper than state-sponsored providers.

Via Mish-modified Google Translate from Energias Renovables, please consider Photovoltaic Sector, Stunned

The Secretary of State for Energy, Alberto Nadal, signed a draft royal decree in which consumption taxes are levied on those who want to start solar power systems on their rooftops. The tax, labeled a "backup toll" is high enough to ensure that it will be cheaper to keep buying energy from current providers.

Spain Privatizes the Sun

Via Google translate from El Pais, please consider Spain Privatizes The Sun

If you get caught collecting photons of sunlight for your own use, you can be fined as much as 30 million euros.

If you were thinking the best energy option was to buy some solar panels that were down 80% in price, you can forget about it.

"Of all the possible scenarios, this is the worst," said José Donoso, president of the Spanish Photovoltaic Union (UNEF), which represents 85% of the sector's activity.

Before the decree it took 12 years to recover the investment in a residential installation of 2.4 kilowatts of power. Following the decree, it will take an additional 23 years according to estimates by UNEF.

Petition of the Candle Makers Revisited

And so the "Petition of the Candle Makers" comes to pass.

I have written about the "petition" on many occasions, but here is the latest reference: Extremely Difficult to Keep Up With Economic Stupidity

Reflections on "Unfair Competition"

Corporations always consider it "unfair" when any other company can do things faster, smarter, or cheaper than they can. The buggy whip industry once protested cars.

Today, land-line telecom companies have to compete with wireless and they don't like it. Now, we see protests about VOIP (voice over internet protocol).

Technology marches on. But France does not like it. The French solution is to tax Skype because it has an "unfair advantage".

This is an age-old unwinnable argument.

Petition of the Candle Makers

The ultimate irony is France's preposterous "unfair advantage" argument was lampooned by French economist Frederic Bastiat back in 1845 when he penned 'Petition of the Candle Makers'.

In his article, candle makers were incensed that the light of the sun could be had for free. The sun's unfair trade advantage was to the "detriment of fair industries" who could not compete against the sun's price.

Something had to be done to "shut off as much as possible, all access to natural light, and thereby create a need for artificial light" so that "industry in France will encouraged".

The moral to this story is "Don't propose something purposefully stupid hoping to make a point. Some idiot might actually think it's a good idea and do it".

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

duminică, 28 iulie 2013

Mish's Global Economic Trend Analysis

Mish's Global Economic Trend Analysis

Seth's Blog : Perhaps you could just make something awesome instead

Perhaps you could just make something awesome instead

More Recent Articles

sâmbătă, 27 iulie 2013

Mish's Global Economic Trend Analysis

Mish's Global Economic Trend Analysis

More personal pins and a privacy policy update

Hi Hari!

Happy pinning!

A Better Bargain for the Middle Class

Seth's Blog : Millions of words and only six emotions

Millions of words and only six emotions

More Recent Articles

vineri, 26 iulie 2013

Mish's Global Economic Trend Analysis

Mish's Global Economic Trend Analysis

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duminică, 28 iulie 2013

More Recent Articles

sâmbătă, 27 iulie 2013

Hi Hari!

Happy pinning!

More Recent Articles

vineri, 26 iulie 2013

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