A New Way of Looking at Ranking Factors

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A New Way of Looking at Ranking Factors Posted: 01 Nov 2011 01:48 PM PDT Posted by dannysullivan This post was originally in YOUmoz, and was promoted to the main blog because it provides great value and interest to our community. The author's views are entirely his or her own and may not reflect the views of SEOmoz, Inc. SEOmoz readers are no strangers to the concept of search engine ranking factors. In general, much of the community that comments seems to delight when some new factor is discovered that may provide a potential ranking boost. Who wouldn't, right? But in this post, I'd like to suggest that perhaps some refocusing on the "forest" of the ranking factors world, rather than the individual "trees" that populate it, might be in order. I've been writing about SEO since 1996, from before we even called it SEO and from before Google existed. In those 15+ years, I've seen no end of attempts to "chase the algorithm." My goal, writing to a broad audience, has always been to highlight the important factors that stand the test of time. It's not that I'm against testing. I love good discoveries as much as anyone, assuming they're real, backed by solid data or can be easily confirmed (too many don't meet these criteria). Understanding if the first use of anchor text overrides further uses or how variations of anchor text across the web might impact rankings is fascinating reading to me. It can help break new SEO ground. What I am against is wasting time chasing things that might not be helpful for more than a day, week or month, versus time spent on the proven, time-tested factors that matter. The Periodic Table Of SEO Ranking Factors That was the genesis behind the Periodic Table Of SEO Ranking Factors that I developed earlier this year, working with the talented folks at Column Five Media to illustrate: It was a labor of love for me, combining my former profession -- that of being a newspaper graphics reporter -- with my current one as a journalist who writes about search engines and search marketing. The table was designed to highlight what I considered to be the most important ranking factors, so that any experienced SEO could work with someone less knowledgeable and easily explain, in a visual manner, things that might help a site from an SEO perspective. Want to rank well? It remains incredibly important to have quality content, or Cq. That's why it's the first factor listed on the chart. Want to rank well? It remains incredibly important to have conducted proper keyword research, or Cr, a topic that sometimes feels forgotten in the quest for more exotic ranking factors. Want to rank well? The locality of a searcher -- Pl -- has grown into a major ranking factor that can seem all-but-forgotten by some SEOs who assume that "normal" results still exist and can somehow be found by running proxies or using the pws=0 trick. Google personalizes results down to the metropolitan level in the US and elsewhere. Good luck "adjusting" for that to get your "normal" results. The Ranking Elements The table contains four major "element" groups: On The Page Factors Off The Page Factors Blocking Factors Violation Factors Here are the individual elements, shown close up: Each individual element is meant to keep people focused on the big picture issues relating to that factor, which I fear sometimes get lost as new SEOs enter the space, as intermediate SEOs try to build their skills and even experienced SEOs may lose track of. The Bigger Picture To better illustrate, I'll use some different examples below, contrasted against the SEOmoz Ranking Factors Survey. I enjoy reading this survey, when it's done every two years. But some of the questions can get way too granular for me. For example, is a keyword being in the first word in an H1 tag important or not? That's something the SEOmoz survey tried to measure. The SEO Periodic Table isn't that specific. When it comes to header tags -- element Hh -- it's trying to stress headers can have an overall impact and that people should be thinking about them generally: Do headlines and subheads use header tags with relevant keywords? Should you focus on "linking root domains with partial match anchor text," as the survey tried to measure? For many people, I'm hoping the table emphasizes that they more generally need to be seeking out quality links, or the Lq factor: Are links from trusted, quality or respected web sites? Should you seek Facebook shares, as the survey found highly correlated? Even though Google's Matt Cutts said Facebook shares don't matter? Even though SEOmoz, after further research agreed with Cutts and wrote "Google is not using Facebook share data directly to rank?" The table says yes, of course you should. And you should because both social shares (Ss) and social reputation (Sr) are generally having an impact on search rankings: Do those respected on social networks share your content? Do many share your content on social networks? Maybe Google isn't using Facebook share data now. But those shares might leak out from Facebook into links that get counted in other ways. Meanwhile, Bing absolutely does use Facebook data as part of its ranking system. And tomorrow, Google might start using them, just as overnight in July, Google suddenly lost Twitter data that it had. Social signals aren't just some fad that's going away. Social signals are the new link building. Exactly how those signals get counted, just as how exactly links get counted, is going to be subject to specific change over time and hard to assess. But generally, you want to do social. If you stopped doing Facebook work solely because you decided "Google doesn't care," then potentially you're behind the curve if Google does care down the line -- not to mention for Bing now and from getting traffic from Facebook directly. Again, it's not that I'm saying don't test, don't have an interest in specifics, don't try to learn. Rather, it's a reminder to focus on the big stuff that matters first. See the larger picture, before you chase down some alley such as whether LDA is real or not. That's what the chart is about. For the SEOmoz fanatic, I hope it's a tool you'll use alongside the SEOmoz ranking survey and the material you read on SEOmoz itself. And for anyone, I hope it's a useful tool to make the complexity of SEO easier to begin with. Bonus: Movie Time For the real beginners, there's another labor of love I worked on earlier this year, a short search engine optimization video to explain SEO in plain language, to anyone. It's only 3 1/2 minutes long: When so many still assume that SEO is a bad thing, to the degree that Google itself had to recently remind everyone that no, SEO isn't spam, I hope our video helps explain the concept in friendly terms, and that people can graduate from it to our Periodic Table framework or the more specific advice they'll find here on SEOmoz and elsewhere. If you like the table, you can get a copy here. There's also our associated Search Engine Land's Guide To SEO, which explains it in detail. We also provide extended resources from us and around the web on our What Is SEO? page, which includes two other guides people should know -- the SEOmoz SEO guide, as well as Google's own. Do you like this post? Yes No

3 Steps to Social SEO for Your Boring-Ass Clients Posted: 01 Nov 2011 03:53 AM PDT Posted by RossTav This post was originally in YOUmoz, and was promoted to the main blog because it provides great value and interest to our community. The author's views are entirely his or her own and may not reflect the views of SEOmoz, Inc. Disclaimer: The following post is very long. If you do not like long blog posts then click here to read the one-line summary. A big complaint I hear in the SEOmoz Q&A forums, and in the industry in general, is from SEOs that have clients that sell boring things that they believe cannot be adapted for Social SEO Campaigns. Those poor SEOs that are tasked with promoting key words like "buy door hinges online", "junk removal smallville" and "personal injury claims". Well Boo Hoo! Get your head out the sand and get creative! As an agency-side SEO analyst, I have found that the more boring the industry the more interesting the social campaigns can be. The following blog post describes the actions I have previously implemented to effectively promote a client in the personal injury claims space. If you are not familiar with the industry the following statements may shine some light on what I was dealing with. Hellishly Spammy: some of the links I seen would make a black hat pharma SEO wince. Terrible Reputation: due to some unscrupulous firms, the industry was branded as "ambulance chasers". Un-sharable Content: can you imagine sharing a link on Facebook for a Fatal Accident enquiry or Road Traffic Accident, then reading below Joe Bloggs "Likes" this. So, how did I combat these issues? Step 1: Produce Great Content The title of Step 1 is slightly misleading; it really should say "Create Epic Content". I hate to say it, as it is rammed down our throats on every industry blog, but it is true. Nobody wants to hear a shitty marketing message; they want a real solid resource created by a real human. When we were creating the content we wanted it to be as sharable, scalable and linkbaitable as possible. Therefore we decided to create an "ask the expert" daily video, where users could ask there question via an email or blog comment and we would get a solicitor to stand in front of a camera and answer the question. We used a Facebook comments plug-in for our blog to stop any spam and also to connect the questions with real people. Side Note: having real people visible asking questions on your site via Facebook is a massive trust metric and can make very positive impacts on your conversion rate. Try putting a Facebook Like box somewhere on a sales page and watch conversions skyrocket! Analyse the Response Offering this service allowed us to really tap into the long tail keywords in this industry as we started to see patterns in the questions people were asking on our own site. This meant that we able to answer peoples' questions directly and also able to create headlines for blog posts that were directly related to the searchers intent. Double Win! As we started to look at the broad set of questions that were coming in and comparing them to the demographic data (thank you Facebook), we started to see trends appearing in the types of questions and the ages of the users. We were actually getting around 50% from students asking legal questions and 50% from potential clients asking about injury claims. Create Context and Reach Out to Users At the point when the claims company was starting to rant and rave about students taking the piss out of the service and not using it for its intended purpose I transformed the perceived pain into a business asset. I knew the student users would never be customers, but I believed that they could be a vehicle for gaining: Lots of backlinks Lots of free content Lots of social shares of said content Therefore, we created a competition where the students would win a fully paid summer job at the personal injury firm, based solely on the merits of their social network power. In order to enter the contest you had to complete tasks at different stages, and then get your peer group to vote on your particular contribution via retweets and Facebook Shares in a similar style to the X Factor or American Idol. In order to give you an idea about the amount of work involved in this competition I will outline the processes. Stage 1 Students were asked to write a blog post on topics picked by the firm* (free content for the win!). The blog posts would then be vetted and the top 20 would be put up on the main corporate blog. The students then had to get their friends to vote on their post by getting retweets and Facebook Shares on the post. (free online promotion for the win!) *Actually picked by me after analysing the keywords we really wanted to rank for. Moo HaHa! Stage 1.5 As this was happening we were busy creating relationships with industry bloggers, making up press releases and contacting the Universities to tell them that this was going on and offered them a press pack to help write about it. We got a bit crafty and put a keyword in the competition title and made sure that HTML versions of our promotion packs were available as well as plain text. HOT TIP: Whenever you deal with Universities DO NOT email them. Pick up the phone and arrange meetings. Make the effort to go see them and they will happily accommodate you when you need links, etc. Stage 2 The top five blog posts were then put into a final that involved creating a video of why they should win the competition. The finalist then had to get their friends to vote on them for a final time via their social networks. Stage 2.5 As the videos were being voted on we went for round two with the bloggers and online newspapers. As we already created the relationship with the Universities, a simple phone call was all that was needed to get them to add new information to their websites. This time the concentration was on getting the Universities to promote their students by getting the wider student body involved in voting by getting faculty members to blog about it and putting it through their main PR centres, all creating lots of juicy links. Stage 3 Announce the winner in the most dramatic possible fashion. In retrospect, we really should have announced the winner and then had a winner's party or a ceremony to make a bigger deal out of the event. This would of allowed us to thank all of the people who blogged and tweeted about the competition and also would have solidified any relationships the firm had created during the course of the competition. It would have also given us some more clout with larger news centres and would have allowed for us to invite some news camera crews along thus, helping the companies offline reputation. Step 2: Produce Great Content Client: Ok let's face it. Nobody cares that I am selling door hinges at rock bottom prices. Or that I have invented a new way to recycle junk. Or that I have just started a partnership with a trade union. Me: Correction. You customers don't care about that stuff. But people in your industry do. So why not use them to promote your content and get those retweets, shares and plus ones? Client: Why would some other guy retweet/share/+1 my content? Me: Because, not only are we going to create amazing content, we are going to become a news hub for the industry and allow other people to contribute to the site. We are going to share other peoples content in our social stream and we are going to talk to other content creators about what they are doing in the industry Client: How long? How much? Why? What's the point? How will this make me more money? Me: "Falcon Punch to the Head" How It Was Done Create a blog on your website on the premise that you are going to become an industry hub for information. When we created the blog we got as much of the company involved as possible and asked for the strongest writers to be regular contributors so we would have a new piece of quality content going out every day. After the blog was created we started submitting it to a couple of aggregators (Technorati, etc.) and list websites. Also using Google’s advanced operators I searched for "top 10", "best of the year", "top 100" style lists for legal blogs and resources. After pulling off this raw list of URLs from Google, I imported them into excel and stripped out any duplicates. I then used the SEOMoz API to pull in the MozRank and the number of backlinks to each domain. Using this data I sorted the list to push the domains with the highest MozRank and unique backlink count to the top. I then went to the websites to find out the twitter handles for the top websites. I then started contacting all of the website owners to let them know about the new blog and asked if they would like to contribute or if they would like to add us to their list. Building Your Twitter Following to get More Retweets This subject is a blog post in of itself; therefore I will just give a quick overview on what we did. Using Follower Wonk I searched for twitter users that were also in the industry. I then exported them all to CSV then uploaded the CSV of names to Export.ly. Export.ly then pulled off all the people that were following the original list along with some critical information like their website address, followers and friend count. I then dumped all this data into excel and stripped out duplicates. Using the SEO Moz API again, I pulled off the backlink and MozRank information. I then sorted the list according to highest SEO authority. This produced a list of high authority websites in the industry along with their twitter handles. I then went to the top 100 sites, subscribed to them in Google Reader and Followed them on Twitter. DON'T BE A DUMBASS LIKE ME At the time I went to the websites and subscribed to their blogs on Google reader and followed the twitter accounts manually. But if I were to do it again I would use a tool like Tweepi, to automatically follow a list of twitter users. Also, I would of used a RSS feed discovery tool to bulk find the RSS feeds of the target sites then import into Google reader...if anyone knows of one please mention it in the comments below. ;-) As I have now established a media base for the industry, I get the client involved. I give them access to the Google Reader account and I set them up with a Twitter client that can schedule tweets. At the time I was using Hootsuite as it also has analytics and some agency side functionality that lets multiple users work on the same account and send messages to each other. Very cool stuff! HOT TIP: At present, I am trialling a new Twitter App called Buffer. It schedules your tweets for you and dynamically changes the time according to how many people retweet you. It basically automates your tweets to give you the furthest reach. Excellent stuff! I then tell them to open up the Google Reader every day to scan the top blogs for four posts that interest them. I then get them to note the Twitter handle and the URL of their favourite blog posts and get them to schedule four posts to go out at varying times of the day, making sure they copy in the author on twitter. This builds relationships with the authorities in the industry but also provides your twitter followers with the best information about your industry from a diverse range of sources. As our posts got retweeted, we also got mentioned in some #followfridays and a couple of Daily Twitter papers. Gradually our follower count started to increase. Now when the firm puts out new content on their blog they have an interested readership that want to share and link to their posts, this providing great SEO value and moreover creating a great business asset. The next step for this firm was to start a link outreach program by contacting all the twitter followers that we wanted to get links from. Step 3: Produce Great Content Every man and his dog and on Facebook but most of the companies on Facebook don't have a clue why they are on Facebook. The other day I had a company registered to a personal profile try to add me as a friend. Yuck! Facebook is a tough nut to crack but there are some simple things you can do to make it work for your boring ass company. The following is what I implemented for the personal injury firm. 1. Set Up a Facebook iFrame This is effectively a mini website present within Facebook itself. This allows for you to have a part of your site with all the same functionality available to Facebook users without having them click off somewhere else. 2. After the Facebook iFrame was setup we started some targeted Facebook Ads to drive traffic to the Facebook site. HOT TIP: When creating the Facebook iFrame, remember to design it for a width of 520px, no one likes horizontal scrolling. Also, if you are putting any contact forms or calls to action on your Facebook site then make sure the contact form redirect the user to a unique thank you page (so we can track it in analytics) and that any call to action link is tracked (either by adding parameters to the end of the link or using a link shortener like bitly or dftba.) 3. Test Different Images, Headlines and Descriptions. As you drive people to your Facebook page, you need to nurture and interact with those who like your page to keep your content in there news stream and also to keep users interested. Create Facebook Quizzes and Polls, share the odd joke, share the odd link. Whatever you do, DO NOT spam your own content constantly. This is the quickest way to get zero followers. Summary Well dear reader thank you for reading all the way through this very length post. I hope it has helped and inspired. In summary.... Just make cool stuff and tell people about it. Nobody cares that the new loan product has X% over 3 years. But they do care that the biggest bank loan ever recorded was $52 Bazillion which was used by an eccentric rich guy to make clones of Rand Fishkin which were used at SEO presentations all over the world so he could be a two places at the same time. Make it fun and it will gain shares and links. Put it in front of people and tell them about it. Email them, Tweet Them, Shout at them in the street- anything to get the voice heard. Just make sure when you are shouting it is something we all want to hear. If you enjoyed this post please follow me on twitter @rosstav and join the conversation. Do you like this post? Yes No

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Seth's Blog : The fall reading list

The fall reading list

A semi-regular feature, here are a bunch of books I've been reading that might change the way you do your work and see the world.

Since posting these lists, my Squidoo pages have earned more than $20,000 for charities like the Acumen Fund. Thanks for that. Feel free to start your own.

 

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What a Jobs Plan Looks Like

Your Daily Snapshot for Wednesday, Nov. 2, 2011   What a Jobs Plan Looks Like Senate Republicans have offered their own plan to grow the economy, but a look at the plans side by side leads to one conclusion: only one is truly a jobs plan. In Case You Missed It Here are some of the top stories from the White House blog. Fort Monroe Becomes a National Monument Today President Obama designated Fort Monroe -- a historic fort in Virginia’s Tidewater region that was integral to the history of slavery, the Civil War, and the U.S. military -- as the 396th unit of the National Park System. GreenGov Presidential Award Winners of 2011 The GreenGov Presidential Awards honor Federal agencies and programs that exemplify President Obama's challenge to lead by example toward a clean energy economy. Drug Shortages Have Reached a "Critical Level" Watch as Bonnie Frawley -- a pharmacy manager -- describes why we can't wait to help our nation's hospitals and how President Obama's executive order will bring attention to the issue and mean fewer drug shortages. Today's Schedule All times are Eastern Daylight Time (EDT). 10:00 AM: The President and the Vice President receive the Presidential Daily Briefing 10:30 AM: The President meets with Senior Advisors 11:25 AM: The President delivers remarks urging Congress to pass the infrastructure piece of the American Jobs Act now 12:05 PM: The President and the Vice President have lunch 12:30 PM: Press Briefing by Press Secretary Jay Carney 1:30 PM: The President and the Vice President meet with Senate Democratic Leadership 6:45 PM: The President departs the White House en route Joint Base Andrews 7:00 PM: The President departs Joint Base Andrews en route Nice, France 7:00 PM: The Vice President and Dr. Jill Biden host House Majority Leader Eric Cantor and Mrs. Diana Cantor for dinner at the Naval Observatory  Indicates events that will be live streamed on WhiteHouse.gov/Live Get Updates Sign up for the Daily Snapshot Stay Connected     Facebook Twitter YouTube Flickr iTunes     This email was sent to e0nstar1.blog@gmail.com Manage Subscriptions for e0nstar1.blog@gmail.com Sign Up for Updates from the White House Unsubscribe e0nstar1.blog@gmail.com | Privacy Policy Please do not reply to this email. Contact the White House The White House • 1600 Pennsylvania Ave NW • Washington, DC 20500 • 202-456-1111

Seth's Blog : Accentuating differences

Accentuating differences

The easiest way to describe your product (or service or candidate or cause) is to outline how it's different from the competition.

"This is just like Brand X, but 5% cheaper, 10% faster, 20% easier to use and it comes in chocolate..."

We do this so often and so naturally that often, we forget to talk about why we made the thing in the first place.

When selling A against B, we might do a great job of explaining why A is better than B, but it's easy to forget that the prospects you are pitching have another option: doing nothing.

 

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Mish's Global Economic Trend Analysis

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• Dutch Government Calls Timeout on Euro Bailout Deal
• LPS Mortgage Monitor: Over 4 Million Loans 90+ Days Delinquent or in Foreclosure, 72% in Foreclosure Not Made Payment for at Least 1 Year
• Greece Replaces Top Brass in Army, Navy, Air Force in Surprise Move; Is Papandreou Preparing for a Military Coup or Afraid of One?
• Greek Referendum Off or On? Who is in Control? Anyone?
• EU Deal Unravels from Many Sides; Italy, France Bond Spreads Hit Record High vs. Germany; Bund Yield Drops Most on Record; All Out Bond Crisis
• Greek 1-Year Bond Yield Hits 205%
• GM Sales Barely Rise, Chrysler's Up 27%; What Does It Mean?
• Regulators Investigate MF Global for Missing Customer Money; MF Global Goes Bankrupt Before Making 1st Interest Payment; Corzine's Achievement Sheet

Dutch Government Calls Timeout on Euro Bailout Deal Posted: 01 Nov 2011 11:04 PM PDT Although there is no formal requirement for the Dutch parliament to approve the EFSF bailout deal, members of the prime minister's coalition are having second thoughts about the deal following the Greek referendum proposal. Amusingly, members of the opposition are pleased with the referendum stating a preference for tossing "the whole rescue package into the trash bin". Please consider Dutch govt wins time on euro bailout deal The Dutch government won time on Tuesday to get parliament's backing for last week's euro zone rescue plan, promising details on the package and facing demands to have a strong budget commissioner and more IMF involvement in the debt crisis. Despite anger among coalition and opposition parties about Greece's plan for a referendum on the rescue plan, the Dutch parliament agreed to wait for details how the euro zone rescue fund EFSF would work and what powers the commission will get to enforce budget rules before reaching a view. The package negotiated last week does not need the formal approval of euro zone national parliaments. But with the cabinet's main ally outside the ruling coalition, Geert Wilders' anti-immigration Freedom Party, strongly opposed to such bailouts, Prime Minister Mark Rutte relies on help from the opposition. The opposition party Labour, whose support is crucial for securing majority support for the minority government, called Greece's referendum plan a "deal breaker" and "spontaneous self-incineration". "The package is not strong enough, and it is effectively wiped off the table now that Greece has placed a bomb under it," Labour MP Ronald Plasterk said in parliament. Plasterk called for strong budget supervision to prevent Italy's Prime Minister Silvio Berlusconi from "throwing a party on the costs of the EFSF fund". Wilders, who dislikes last week's deal and wants Greece to leave the euro zone, told reporters he was pleased about the referendum because it would mean "the whole rescue package can go into the trash bin". Right now this delay appears to be a mere formality. However, politics can take a U-turn at any time as we have seen. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

LPS Mortgage Monitor: Over 4 Million Loans 90+ Days Delinquent or in Foreclosure, 72% in Foreclosure Not Made Payment for at Least 1 Year Posted: 01 Nov 2011 09:00 PM PDT Inquiring minds are reading the latest LPS Mortgage Monitor, released today. Foreclosure timelines continue to increase across the board - almost 40 percent of loans in foreclosure have not made a payment in two years, and 72 percent have not made a payment in a year or more. New problem loan rates increased sharply over the last two months, with 1.6 percent of loans that were current six months ago now 60 or more days delinquent or in foreclosure. Here are a few charts from LPS. Click on any chart for a sharper image. Over 4 Million Loans 90+ Days Delinquent or in Foreclosure Delinquencies and Foreclosures 39% of Loans in Foreclosure Not Made Payment in 2 Years, 72% for 1 Year Take a good look at that chart. There has not been a decrease in the no payment for over 2 years category ever. At the beginning of 2011 it was 28%. It is now 39%. At the beginning of 2010 it was 12%. Foreclosure Starts Outnumber Sales by Factor Over 3:1 If things are improving, it's not by much. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

Greece Replaces Top Brass in Army, Navy, Air Force in Surprise Move; Is Papandreou Preparing for a Military Coup or Afraid of One? Posted: 01 Nov 2011 05:05 PM PDT Greek prime minister George Papandreou pulled a second major surprise move in two days. Yesterday he rattled the markets with a bombshell voter referendum proposal on the EU bailout (see EU Deal Unravels from Many Sides; Italy, France Bond Spreads Hit Record High vs. Germany; Bund Yield Drops Most on Record; All Out Bond Crisis). Greece Replaces Top Brass in Army, Navy, Air Force in Surprise Move Today in another surprise move, Greece Replaces Top Brass in Army, Navy, Air Force In a surprise move, on Tuesday evening the defence minister replaced the country's top brass. An extraordinary meeting of the Government Council of Foreign Affairs and Defence (Kysea), which comprises the prime minister and other key cabinet members, accepted Defence Minister Panos Beglitis' proposal that the following changes be made to army, navy and air force and the general staff: General Ioannis Giagkos, chief of the Greek National Defence General Staff, to be replaced by Lieutenant General Michalis Kostarakos Lieutenant General Fragkos Fragkoulis, chief of the Greek Army General Staff, to be replaced by lieutenant general Konstantinos Zazias Lieutenant General Vasilios Klokozas, chief of the Greek Air Force, to be replaced by air marshal Antonis Tsantirakis Vice-Admiral Dimitrios Elefsiniotis, chief of the Greek Navy General Staff, to be replaced by Rear-Admiral Kosmas Christidis It is understood that the personnel changes took many members of the government and of the armed forces by surprise. Is Papandreou Preparing for a Military Coup or Afraid of One? I can only think of two reasons for this latest surprise announcement. Papandreou or the Defense Minister is Preparing for a Military Coup (to stay in power if he does not survive the vote of confidence) Papandreou or the Defense Minister is Afraid of a Military Coup Take your pick. It's one or the other but it could be both. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

Greek Referendum Off or On? Who is in Control? Anyone? Posted: 01 Nov 2011 01:45 PM PDT The stock market rallied in a spurt around 12:30 Central when a Dow Jones Newswires reported that a Greek Socialist Party official said the plan to have voters approve the rescue is "basically dead." Then, about an hour before the close came news from a Greek government spokesman that the referendum was back on and the S&P slid back towards the lows of the day. Finally, in a bit late buying the S&P surged 12 points to close down about 35 points, roughly 2.8%. S&P 500 Futures, 3-Minute Chart The question is: Who is an control? Better yet, is anyone in control? One thing we know is Papandreou's call for a vote of confidence is on. We also know his fragile coalition holds an extremely slim 3 margin majority in Parliament. I believe on these announcements, he will lose that vote of confidence. If so, we do not know who will replace him. If the call for voter referendum is not binding, then it is likely the next Greek parliament or prime minister will cancel it. There are a lot of open questions here in regards to both the vote of confidence and the voter referendum, yet I see them posed nowhere else. Is there a Greek constitutional expert around? Meanwhile Merkel and Sarkozy will meet in Cannes November 3 to discuss the Greek crisis in yet another EU 20-member summit. If the referendum is on, the EU is no longer in control of a Greek default. More specifically, the EU was never in control, it only appeared that way. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

EU Deal Unravels from Many Sides; Italy, France Bond Spreads Hit Record High vs. Germany; Bund Yield Drops Most on Record; All Out Bond Crisis Posted: 01 Nov 2011 10:35 AM PDT In the wake of Papandreou's Call for Voter Referendum on EU Debt Deal sovereign debt yields plunged in Germany and surged higher in most other European countries, but most notably Italy and France. Bloomberg reports Italian Bonds Slide, Premium to Bunds Reaches Record, Amid Greece Concern Italian bonds led declines among the securities issued by Europe's most indebted nations after a Greek plan to hold a referendum on its international bailout added to concern the region's financial turmoil will deepen. Italy and France's 10-year borrowing costs climbed the highest levels relative to benchmark German debt since before the creation of the euro in 1999. Bund yields fell the most on record, with the securities outperforming all their euro-area peers, as investors sought the safest assets. "The run-up will put the European Central Bank, European Union and International Monetary Fund in a tough position regarding disbursements to Greece," El-Erian wrote. The EU deal "appears to be unraveling from many sides." The ECB was said by three people to have bought Italian debt today as it tries to stem financial-market contagion to the euro area's biggest bond market. Two-year note yields still rose 75 basis points to 5.75 percent, the highest since 1997. The five-year rate rose to more than 6 percent, a premium of more than 5 percentage points compared with similar-maturity German debt. European Sovereign Debt Spread Table 10-Year Bonds Country 10-Yr Yield Spread vs. Germany Germany 1.77 0.00 France 2.96 1.19 Belgium 4.40 2.63 Spain 5.52 3.75 Italy 6.19 4.42 Ireland 8.21 6.44 Portugal 11.80 10.03 Greece 24.65 22.88 European Sovereign Debt Spread Table 2-Year Bonds Country 2-Yr Yield Spread vs. Germany Germany 0.41 0.00 France 1.09 0.68 Belgium 2.77 2.36 Spain 4.02 3.61 Italy 5.28 4.87 Ireland 9.27 8.86 Portugal 20.30 19.89 Greece 87.28 86.87 Italy yields are well off the highs of the day after the ECB stepped up Italy bond purchases. Italy 10-Year Government Bonds Italy 2-Year Government Bonds For some reason Bloomberg charts do not match intra-day figures but the summary section on the left is accurate. Note the explosion in Italy's 2-year bond yield, at one point up .76. Meanwhile, the German 10-year yield fell 26 basis points and the 2-Year yield fell 13 basis points. Thus at one point today the German 2-year spread vs. Germany widened by a massive 89 basis points. The deal is certainly "unraveling from many sides" with force, so much so that Europe is in the midst of an "all out sovereign bond crisis". Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

Greek 1-Year Bond Yield Hits 205% Posted: 01 Nov 2011 09:24 AM PDT I have been wondering when Greek bond yields would top 200%. Today is the day. Greece 1-Year Government Bond Yield Congratulations to anyone selecting this target date. However, predictions made yesterday in the wake of Papandreou's Call for Voter Referendum on EU Debt Deal do not count. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

GM Sales Barely Rise, Chrysler's Up 27%; What Does It Mean? Posted: 01 Nov 2011 09:06 AM PDT Nearly lost in the European carnage this morning, GM Sales Barely Rise, Chrysler's Up 27%. Chrysler Group LLC's October U.S. auto sales rose 27% while General Motors Co. climbed just 1.7% amid a mixed picture for the largest U.S. auto makers. GM suffered declines in all its brands except Chevrolet, the Detroit auto maker said on Tuesday. Its dealer inventory was up 15% from a year ago and up 6.1% from September. The auto maker reported total sales for the month of 186,895 vehicles. Its Chevrolet sales rose 6% while Cadillac sales fell 11.9%, Buick declined 7% and GMC sales dropped 4.6%. Overall, GM's retail sales were up 2.6% ... Sales down and dealer inventory up 15% at GM. The key takeaway from last months "good" GM sales report is it was largely based on channel stuffing. "Sales" get reported when cars are shipped to the dealer and cars are stacking up at GM dealers. This does not bode well for jobs, production, or GDP looking ahead, unless consumers put on their shopping hats. I do not believe they will. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

Regulators Investigate MF Global for Missing Customer Money; MF Global Goes Bankrupt Before Making 1st Interest Payment; Corzine's Achievement Sheet Posted: 01 Nov 2011 12:31 AM PDT Today I Congratulate Jon Corzine, CEO of MF Global, for an unheard of combination of rare "achievements". Corzine's Achievement Sheet After being forced out as CEO of Goldman Sachs, Corzine spent a record $62 million of his own money on a US Senate campaign and won. The prior record was $28 million. During the senate campaign, Corzine refused to release his income tax return records citing a confidentiality agreement with Goldman Sachs. In 2000, Corzine denied having paid off African-American ministers, when in fact the foundation controlled by him and his wife had paid one influential black church $25,000. While Senator, Corzine decided he would rather be governor of New Jersey and spent $38 million buying the governorship. As governor, Corzine spent some $200,000 of his own money on advertisements to promote a referendum on the 2007 New Jersey ballot to borrow $450 million to fund stem cell research. The referendum was rejected although $270 million had previously been approved to build stem cell research centers. Corzine, in attempting to pass the 2007 fiscal year budget, said that he would not accept a budget that did not include a hike in the sales tax from 6% to 7%. After the legislature failed to pass Corzine's budget by the deadline of July 1, 2006, he signed an executive order that immediately closed down all non-essential state government services. Corzine lost his reelection bid to Republican Chris Christie. It takes rare talent for Democrats to lose in New Jersey. In 2010 Corzine was named CEO of MF Global and used 40-1 leverage on foolish bets on European bonds driving the company into bankruptcy. MF Global is the first company to go bankrupt in three years while still rated investment grade by rating agency S&P. The previous company was Washington Mutual. MF Global is one of very few companies ever to go bankrupt before making its first bond payment. Corzine in Bed with Union Leaders, Literally Many of the above facts were from Wikipedia. Here is a lengthy snip on influence peddling. In the spring of 1999, when Jon Corzine was running for the United State Senate, he met Carla Katz, the then president of Local 1034 of the Communications Workers Corzine and Katz were soon dating, and they began appearing in public as a couple in early 2002, shortly after Corzine's separation from his wife Joanne. The Corzines divorced the following year. For more than two years Corzine was romantically involved with Katz. She lived with him at his apartment in Hoboken from April 2002 until August 2004. After Corzine's breakup with Katz, their lawyers negotiated a financial payout in November 2004. According to press accounts, the settlement for Katz exceeded $6 million, including cash (in part used to buy her $1.1 million condominium in Hoboken), a college trust fund to educate her children, a 2005 Volvo sport utility vehicle, and Corzine forgave a $470,000 loan that he had made to Katz in 2002 so that she could buy out her ex-husband's share of their home in Alexandria Township. Corzine later admitted that he had also given $15,000 to Carla Katz's brother-in-law, Rocco Riccio, a former state employee who had resigned, after being accused of examining income tax returns for political purposes. At the time, Katz was president of the Communications Workers of America Local 1034, which bargains on behalf of many state employees. In the fall of 2006, during an impasse in contract negotiations between the Corzine administration and the state's seven major state employee unions (including the CWA), Katz contacted the governor by phone and e-mail to lobby for a renewal of the negotiations. Their relationship and the financial settlement Katz received after their breakup led to criticism of potential conflicts of interest in labor negotiations while Corzine was governor. A state ethics panel, acting on a complaint from Bogota mayor Steve Lonegan, ruled in May 2007 that Katz's contact with Corzine during negotiations did not violate the governor's code of conduct. Separately, New Jersey Republican State Committee Chairman Tom Wilson filed a lawsuit to release all e-mail correspondence between Corzine and Katz during the contract negotiations. On May 30, 2008, New Jersey Superior Court Judge Paul Innes ruled that at least 745 pages of e-mail records should be made public, but Corzine's lawyers immediately appealed the decision. Corzine won his case on appeal, and on March 18, 2009, the New Jersey Supreme Court ruled that it would not hear arguments in the case, effectively ending the legal battle to make his e-mails with Katz public. Corzine spent approximately $127,000 of taxpayer funds to keep the e-mails secret. Despite these efforts, on August 1, 2010, The Star-Ledger published 123 of the Corzine-Katz e-mails, revealing the extent of their personal contact during negotiations over a new state workers contract in early 2007. Corzine Perfect Fit for MF Global In spite of that background, (or do I mean because of it), MF Global thought Corzine was a perfect fit. Indeed, those looking for reckless behavior, massive risk taking, and willingness to bet the farm on marriage, in politics, and in life, Corzine represented rare "impossible to pass up" talent. MF Global Bonds Fail to Make First Payment In a rarely achieved feat, MF's Corzine Key Man Bonds Fail to Make First Payments Bond investors lent MF Global Holdings Ltd. (MF) $650 million three months ago in a bet Jon Corzine would succeed in turning the futures broker into a mini-version of Goldman Sachs Group Inc. The firm filed for bankruptcy before making its first interest payment on the debt. The former New Jersey governor and Goldman Sachs co-head was deemed so key to the broker's success that bondholders demanded an extra percentage point of interest if he left for a post in the Obama administration. On Oct. 24, Moody's lowered the firm's credit ratings in part on concern that the company wasn't sufficiently managing risk. A day later, the broker reported its largest-ever quarterly loss and disclosed how much its exposure to bonds sold by Italy, Spain, Belgium, Portugal and Ireland had grown. Assurances that all the European debt MF Global had invested in would mature by December 2012 and that the company had financed the transactions through the life of the bonds didn't stop its shares from falling 66 percent in four days to $1.20 a share. The broker tapped almost all of a $1.2 billion credit line. Bondholders are now in line with creditors owed $39.7 billion, according to Chapter 11 papers filed yesterday in U.S. Bankruptcy Court in Manhattan. Corzine's Fault "The fact that Jon Corzine, the ex-head of Goldman Sachs, was at the helm for MF Global gave the company a lot more ability to extend their reach than they ordinarily would," Sean Egan, president of Egan-Jones Ratings Co., said yesterday on Bloomberg Television's InBusiness with Margaret Brennan. The balance sheet reached 40 times the firm's equity, Egan said. "They should have been levered in the area of maybe about six-to-one," he said. "Having only 2.5 percent equity to assets is ridiculous. That means if you have a 2.5 percent downdraft in the balance sheet, which is very likely, then they're bankrupt." MF Global Bankruptcy: The Biggest Losers The Wall Street Journal reports on MF Global Bankruptcy: The Biggest Losers 1) Fidelity funds, 13.9 million shares or 8.44% of common stock 2) Guardian Life Insurance Co., 12.9 million common shares, or 7.8% 3) Fine Capital Partners, 21.5 million shares, 7.37% *(In a recent SEC filing, Fine Capital reporting owning 12.16 million shares, for a 7.4% stake in MF Global.) 4) Cadian Capital Management, 10.2 million shares, 6.17% 5) TIAA-CREF, 9.5 million shares, 5.77% Corzine swept in last year to lead MF Global, and he had ambitions to remake the company in the image of his former company, Goldman Sachs. Instead, Corzine's optimism about investing MF Global's money in European sovereign debt — over the objections of others, according to today's Wall Street Journal story — helped imperil the firm. Over the summer, bond investors apparently thought highly enough of Corzine that they demanded a richer payout from MF Global if Corzine left the firm for a high-ranking government job. Today, such a "key man" clause seems like an antique. Apart from a dent to his reputation, Corzine also stands to lose financially from the MF Global bankruptcy filing. Corzine's compensation last year was $14.2 million, including stock options MF Global valued at $11.1 million. Those options pay off at a share price of $9.25, which means they are very likely to be worthless now. Volcker's Campaign Against Proprietary Trading Bloomberg reports MF Exposes Risk Volcker Wants to Curb Jon Corzine's risk appetite helped destroy his firm. It also provided an object lesson for Paul Volcker's campaign against proprietary trading on Wall Street. Nineteen months after former New Jersey Governor Corzine became chairman and chief executive officer, MF Global Holdings Ltd. (MF) yesterday filed for bankruptcy. Corzine's decision to boost risk-taking, including a $6.3 billion wager with the firm's own money on European government debt, triggered the collapse. "In the wake of 2008, when we all should have learned a lesson, Jon Corzine told me himself that it was a relatively staid, not risk-oriented firm and he needed to ratchet up the risk," William Cohan, author of "Money and Power: How Goldman Sachs Came to Rule the World," said on Bloomberg Television. "Well, he does that and it blows up in his face and for the first time he can't unwind the trade. Honestly I'm still shocked and it should not have happened." Corzine, 64, learned the strategy of making big trading bets during his 24 years at New York-based Goldman Sachs, which he ran from 1994 to 1999 before being forced out. While Corzine sought to recreate the Goldman Sachs that he remembered, the firm's current management was reducing risk- taking -- in part in response to the Volcker rule. It closed Goldman Sachs Principal Strategies, a prop-trading team that bet primarily on equities, and the Global Macro Proprietary Trading desk, which wagered on bonds, currencies and commodities. The Volcker rule also will require Goldman Sachs to reduce investments in private equity and hedge funds to no more than 3 percent of each of the funds -- or 3 percent of Goldman Sachs's Tier 1 capital. In the latest quarter, such investments were responsible for the firm reporting its second quarterly loss since going public in 1999. The Volcker rule, as written in the Dodd Frank Act, had "so many different exemptions and exceptions and loopholes that it almost became nearly impossible for the regulators to fashion a rule that can live up to its original intent," said Barofsky, a Bloomberg Television contributing editor. Regulators Investigate Missing Money The New York Times DealBook reports Regulators Investigating MF Global for Missing Money Federal regulators have discovered that hundreds of millions of dollars in customer money has gone missing from MF Global in recent days, prompting an investigation into the brokerage firm, which is run by Jon S. Corzine, the former New Jersey governor, several people briefed on the matter said on Monday. The recognition that money was missing scuttled at the 11th hour an agreement to sell a major part of MF Global to a rival brokerage firm. MF Global had staked its survival on completing the deal. Instead, the New York-based firm filed for bankruptcy on Monday. Regulators are examining whether MF Global diverted some customer funds to support its own trades as the firm teetered on the brink of collapse. The discovery that money could not be located might simply reflect sloppy internal controls at MF Global. It is still unclear where the money went. At first, as much as $950 million was believed to be missing, but as the firm sorted through its bankruptcy, that figure fell to less than $700 million by late Monday, the people briefed on the matter said. Additional funds are expected to trickle in over the coming days. In any case, what led to the unaccounted-for cash could violate a tenet of Wall Street regulation: Customers' funds must be kept separate from company money. One of the basic duties of any brokerage firm is to keep track of customer accounts on a daily basis. Neither MF Global nor Mr. Corzine has been accused of any wrongdoing. Lawyers for MF Global did not respond to requests for comment. DealBook stated "the inquiry threatens to tarnish further the reputation of Mr. Corzine". Short of uncovering fraud, is that possible? Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

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