joi, 23 mai 2013

Photo Gallery: Behind the Scenes in April 2013

The White House Your Daily Snapshot for
Thursday, May 23, 2013
 

Photo Gallery: Behind the Scenes in April 2013

White House photographers are hard at work every day capturing some incredible moments for history, and every month we release a photo gallery that takes you behind the scenes – giving you an inside look at the President and what keeps him busy.

Check out our April gallery, including photos from the Easter Egg Roll to the opening of the George W. Bush Library and Museum.

See the full gallery of photos.

President Barack Obama laughs with former Presidents Jimmy Carter, Bill Clinton, and George W. Bush, prior to the dedication of the George W. Bush Presidential Library and Museum on the campus of Southern Methodist University in Dallas, Texas, April 25, 2013. (Official White House Photo by Pete Souza)

In Case You Missed It

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

President Obama Responds to the Tornadoes in Oklahoma
President Obama will travel to the Oklahoma City area to see firsthand the response to the devastating tornadoes and severe weather that have impacted the area on Sunday night and Monday. He will visit with affected families as well as thank first responders.

Building Opportunities in Indian Country: Congratulations to the Graduates of Navajo Technical College
Dr. Biden addresses a class of graduates at Navajo Technical College in Crownpoint, New Mexico.

Aspiring Americans Share their Stories as Senate Debates Immigration Reform
The President and the Vice President hosted a meeting today in the Oval Office with young immigrants, also known as DREAMers, as well as with the siblings and spouses of undocumented immigrants, to hear directly from people whose families are affected daily by our nation’s broken immigration system.

Today's Schedule

All times are Eastern Daylight Time (EDT).

10:45 AM: The President and the Vice President receive the Presidential Daily Briefing

11:00 AM: The President meets with senior advisors

12:30 PM: The President and the Vice President meet for lunch

2:00 PM: The President delivers speech on the Administration’s counterterrorism policy WhiteHouse.gov/live

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

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Mozscape in the Wild: How The API is (and Could be) Used

Mozscape in the Wild: How The API is (and Could be) Used


Mozscape in the Wild: How The API is (and Could be) Used

Posted: 22 May 2013 07:52 PM PDT

Posted by Ryan_Watson

Did you know that there are over 90 billion URLs are packed into our Mozscape API? That’s a lot of links. So many links, in fact, that it can be daunting to dream up all of the many ways that you could put those links to good use. When we originally built Linkscape (the predecessor to Mozscape), we mainly had one thing in mind... SEO and backlinks.

But there’s a whole lot more than that.

Links are only the beginning, it’s what those links can tell us that’s so darn interesting. Which is why I wanted to call out all of the amazing ways that developers (and marketers) are using Mozscape data to better their work, as well as encourage new uses of Mozscape data that have yet to be explored. (Feel free to jump in and create your own API key any time.)

How Mozscape is Being Used Today

Mozscape's wealth of links can be used in a variety of ways: from SEO audits, to domain valuations, to excel integration. Here at Moz, we have only begun to scratch the surface of how we can utilize the API. We currently use it to run some of our own tools such as Open Site Explorer and the Mozbar.

But I don't want to focus on the way we use it. Let's take a look at the way other developers have demonstrated some exciting uses for Mozscape. Hopefully these will get your mind going, thinking up other ways to use the data as well.

SEO Audits

We’ll start with the most obvious of use cases, SEO audits. There quite a few examples of SEO audit tools that use Mozscape data, but a few of our favorites (that are in front of a paywall) are the HubSpot Website Grader and The Found SEO Audit Tool, both of which bring the heat.

Mozscape data is what powers things like the total pages indexed by search, MozRank, a list of the most authoritative pages, along with their corresponding anchor texts. The beauty of this use case is that it can provide a great lead-gen funnel for all of the SEO agencies out there, proving value up front with an email address required prior to running the report. As a digital marketing agency, using Mozscape data to develop a site audit is a great way to get users into your sales funnel. You know, that inbound marketing stuff -- cold calls are old news.

Domain Valuation

How valuable is a website, purely from an online authority perspective? Traditionally, that was a very tough question. You could look at things like site traffic (which typically isn’t very accurate) or rankings for certain terms, but that’s a far-sighted approach to the question. Think about using the metrics behind Mozscape, like MozRank, Domain Authority, and MozTrust instead. Flippa, for example, uses Mozscape data as a datapoint for due diligence.

You could imagine this kind of domain valuation anywhere else domains are bought or sold, most of which have yet to use Mozscape data. The value, of course, is providing as much confidence to the buyers of web properties based on the “web footprint” of the site.

Spreadsheet Kung-Fu

The spreadsheet kung-fu of this industry is unmatched anywhere else. With the integration of Mozscape data to Excel, some have been able to make Excel sing. The beauty of using Excel for analyzing Mozscape data is that you can slice and dice as you please, without setting up complex API calls. Perhaps our favorite example of Excel comes from the illustrious Richard Baxter, with the Links API Extension from SEO Gadget.

However, if Google Docs are more up your alley, the amazing Aleyda Solis created just the thing for you (so did Chris Lee). Tools like these allow the average marketer to dig into the firehose of data available through the API in a simple and recognizable interface.

Client Reporting

Yes, that's right. iAcquire uses the data when creating client reports as it not only helps them to inform the client about how their pages are doing but to also show the importance of certain pages on their site. The data is both a research tool and an education tool.

"Below is a screenshot from a ranking research report showing data we gathered for the keyword 'inbound marketing tips.' Moz stats are represented throughout the stats columns. As we work with these reports we are able to see if any of our content distribution efforts resulted in links on page or domain as can be seen in the far left columns."

iAcquire ranking research report

How Mozscape Could Be Used

That’s how Mozscape is being used today, but it’s only the tip of the iceberg. A few folks have realized the potential outside of the traditional use cases that I’ve mentioned above. The power of the data comes when we take Mozscape data outside of its traditional context of pure link evaluation. Let me show you what I mean.

Link Building

Its relatively easy to imagine Mozscape's data being used for link building. With Mozscape's massive amount of link data, SEOs are able to prioritize their link building efforts, and focus on value added efforts.

CRM

You could imagine that some of the examples noted above have been used for link building, but what about a deeper integration into a contact manager? Something that would allow the user to prioritize outreach by the value of a domain.

Just as one can do with the Klout score (or Social Authority) on Twitter, the same can be done for customer relationship efforts in filtering Domain Authority to determine importance.

Top Lists

We’ve seen hints of blogs using Mozscape data determine a top startup list, like the GeekWire 200, but the same could be applied for any rankings list of web properties.

Traditionally, lists have used Alexa or Compete traffic data to determine web prominence, but they’re so inaccurate. Other lists have used social specific metrics like social followings, but those too fall short. Geekwire’s list of the top 200 startups in Seattle uses a blend of both social and web data (External links, MozTrust) to determine just how influential a site is, providing the full picture.

How Could You Use the API?

I’m sure we've missed a ton of ideas, so we’re calling on you to help us find those new opportunities for Mozscape. Things like a tightening relationship between links and social networks, and categorizing link sources. How would you use this data, and how would you build it? Better yet, why not create your key and get going? 

We want to make it easy for you.

We've been working quite hard to make our indexes faster and have recently updated our Mozscape API documentation. We want to make it as simple for you to use the data to get your idea up an running as possible.

Plus, if you create something, it's likely we'll get you added to our app gallery. We have everything from large corporations to individuals who have used the API and we show off their work in the gallery.

We'd love to hear from you. Obviously we always encourage folks to jump in and check out the free API (as well as the paid), and use the data for something useful for you. We're also quite open to hearing about ways we can improve our own tools with the data or help educate people better. I look forward to reading through your feedback and seeing if there are ways we can help get people started using Mozscape.


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Seth's Blog : Thoughts on education and the burgeoning trophy shortage

 

Thoughts on education and the burgeoning trophy shortage

It's graduation season, so a few relevant links about school, students and our future:

Here's the audio of an interview I did with PlayBuffet

My TEDx talk about education

And a reminder about Stop Stealing Dreams, a free manifesto that asks, "what is school for?" I hope we can ask this question more and more often...

Feel free to share with your favorite graduate. Or her parents.

Bonus: 20 video minutes at Creative Mornings.

     

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miercuri, 22 mai 2013

Mish's Global Economic Trend Analysis

Mish's Global Economic Trend Analysis


China Manufacturing Slips Back Into Contraction

Posted: 22 May 2013 10:15 PM PDT

The HSBC Flash China Manufacturing PMI™ shows China Manufacturing Slips Back Into Contraction.
Key Points

  • Flash China Manufacturing PMI™ at 49.6 (50.4 in April). Seven-month low.
  • Flash China Manufacturing Output Index at 51.0 (51.1 in April). Three-month low.



click on chart for sharper image

Commenting on the Flash China Manufacturing PMI survey, Hongbin Qu, Chief Economist, China & Co-Head of Asian Economic Research at HSBC said: "The cooling manufacturing activities in May reflected slower domestic demand and ongoing external headwinds. A sequential slowdown is likely in the middle of 2Q, casting downside risk to China's fragile growth recovery. Moreover, the further signs of labour market slackness call for more policy support. Beijing still has fiscal ammunition to do so."
Comment on the Comment

Economic illiterates call for more "policy support" month after month. Such "support" is about to wreck Japan and the fools do not see it.

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

Rand Paul Has the Right Idea, Congress Should Apologize to Apple; Holy Grail of Tax Avoidance; The "Golden Goose"; Hypocrite McCain

Posted: 22 May 2013 04:51 PM PDT

Rand Paul created quite a stir in Congress when he Tweeted 'The Senate should apologize to Apple'.

  • @SenRandPaul: Instead of examining our broken tax system, the US Senate is about to harass Apple-one of the greatest business success stories in history.
  • @SenRandPaul: I am offended by a $4 trillion government bullying, berating and badgering one of America's greatest success stories.
  • @SenRandPaul: To US Senate: I say, instead of Apple executives, you should have brought in a giant mirror if you want to see who is responsible.
  • @SenRandPaul: Instead of doing the right thing we drag businessmen and women in here to berate them for trying to maximize their profits for shareholders.
  • @SenRandPaul: Apple has done more to enrich people's lives than politicians will ever do.
  • @SenRandPaul: To the Apple executives here, I apologize for this theater of the absurd.
  • @SenRandPaul: If you want to chase companies like Apple away, continue to vilify them. Congress should be giving Apple an award today.
  • @SenRandPaul: It's absurd for Congress to vilify businesses like Apple for wanting to minimize their tax code just like every other American rightly does.
  • @SenRandPaul: The Senate hauled before a committee one of America's greatest success stories—and wanted what? Applause?

Why did Paul Tweet Those Things? 

Because the Senator Carl Levin (D-Mich.) ripped Apple's 'Holy Grail' Of Tax Avoidance ahead of congressional testimony.

It's absurd that Apple CEO Tim Cook Should be in Congress in the first place.

Did Apple break any laws? Of course not. Is Apple responsible for the absurd tax code or is Congress? The answer of course is Congress.

What About GE?

Tax law is so absurd that GE paid no corporate income tax in 2010. GE also paid no corporate income taxes in 2009.

For doing precisely the same thing, Cook had to appear before a senate subcommittee.

GE's response "GE pays what it owes under the law and is scrupulous about its compliance with tax obligations in all jurisdictions."

Mish says please note that the CEO of GE, Jeffrey Immelt, advises president Obama on business.  

Holy Grail of Tax Avoidance

The Wall Street Journal reports Apple CEO Tim Cook, Lawmakers Square Off Over Taxes.
Apple Inc.'s tax strategies came under harsh scrutiny Tuesday in the Senate, where lawmakers are finding it far easier to call for a simpler tax code than to produce one. Still, nothing in the deluge of bad publicity about the tax code in recent weeks touches on the most durable obstacle to congressional action on a broad tax overhaul. The two parties remain far apart on whether such a rewrite should also raise revenues to reduce the deficit. Democrats insist it should, while Republicans insist it shouldn't.

Sen. Carl Levin (D., Mich.), chairman of the investigations panel, on Tuesday accused Apple of employing "alchemy" and "ghost companies" to escape tax collectors in the U.S. and Ireland, the base of the firm's international operations outside the Americas.

"Apple has sought the Holy Grail of tax avoidance," said Mr. Levin. "Apple is exploiting an absurdity, one that we have not seen other companies use."
Who is responsible to tax code, Levin or Apple?

The "Golden Goose"

Barron's reports 'You Shifted Your Golden Goose, It's Not Right,' Says Levin
Apple (AAPL) CEO Tim Cook's offered his testimony on Capitol Hill, before the U.S. Senate Permanent Subcommittee on Investigations, regarding tax policy and overseas earnings, followed by questions from the Senators.

Senator Carl Levin comes back and presses Apple's tax administration head, Phillip Bullock, as to whether the company effectively "shifted economic rights" to intellectual property, the "crown jewels of Apple Inc," as Levin puts it, to Apple's Irish subsidiaries.

Levin persists: "You shifted something, the most valuable thing you have, the economic rights to the most valuable thing you own, intellectual property, the thing that produces the profits, to those three Irish corporations that you own. 70% of the profits worldwide now end up with those Irish corporations. Of course you can bring those profits home. The only reason you're not is because they're transferred to those three Irish companies."

Hypocrite McCain

Fortune magazine says Senators Carl Levin and John McCain were careful to balance praise for Apple's (AAPL) achievements with outrage over its "convoluted and pernicious" (McCain's words) tax avoidance strategies. Sen. Rand Paul showed no such balance. He lit into his own committee's leadership for "dragging" one of America's great success stories into what he called a "show trial."

Mish says McCain is one of the biggest hypocrites you can find when it comes to tax avoidance.

There are two reasons companies keep profits overseas.

  1. Tax law (for which McCain has voted for)
  2. Tax repatriation holidays for which McCain has personally sponsored

McCain Sponsors Repatriation Tax Holiday

Accounting Today reported on October 6, 2011 McCain and Hagan Introduce Repatriation Tax Holiday Bill.
Senators John McCain, R-Ariz., and Kay Hagan, D-N.C., introduced legislation Thursday allowing multinational corporations to repatriate their foreign earnings at a reduced tax rate. The bipartisan bill, known as the Foreign Earnings Reinvestment Act, aims to trigger the flow of $1 trillion from the foreign subsidiaries of U.S.-based multinationals at a reduced tax rate of 8.75 percent, as opposed to the statutory corporate income tax rate of up to 35 percent. It would accomplish this through a temporary dividends received reduction of 75 percent.

As an incentive to create jobs, the bill would allow companies to further lower the tax rate they pay to 5.25 percent if they grow their domestic payroll during 2012.
McCain Should Apologize to Paul

It seems to me that hypocrite Senator John McCain should apologize to Senator Rand Paul as well as to Apple.

Instead The Hill reports Sen. John McCain (R-Ariz.), also defended the Senate inquiry, calling it "offensive" for anyone to accuse Levin of bullying.

Final Thoughts

It is absolutely absurd for taxes to be lower overseas than in the US.

Current policy encourages movement of jobs and capital to foreign countries. If anything, taxes ought to be higher on foreign profits than lower. That would encourage investment in the US.

I have been writing about this for years. Levin acts as if this is something new. Perhaps he is dumb enough that he just figured this out. Regardless, he still is not bright enough to realize where  to point the finger. 

Finally, and as I also pointed out, tax repatriation policies do not help at all. And on that score Senator McCain is personally responsible. He does not know where to point the finger either.

I will be glad when McCain retires. Rand Paul is the future of the party, McCain is the past.

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

Bernanke's Semi-Annual Tap-Dance of Distortions, Half-truths, Lies, and Hypocrisy to U.S. Congress

Posted: 22 May 2013 11:50 AM PDT

Inquiring minds with extra time on their hands this morning are plodding through the Full Transcript of Bernanke's Testimony To Joint Economic Committee, U.S. Congress looking for the usual collection of half-truths, distortions, and outright lies it usually contains.

Here are some point-by-point statements by Bernanke with my comments immediately following each set of statements.

Bernanke: Conditions in the job market have shown some improvement recently. The unemployment rate, at 7.5 percent in April, has declined more than 1/2 percentage point since last summer. Moreover, gains in total nonfarm payroll employment have averaged more than 200,000 jobs per month over the past six months, compared with average monthly gains of less than 140,000 during the prior six months.

Mish: What Bernanke failed to say is real wages are anemic and the Fed's low interest rate policy is making it easy for corporations to borrow at excessively low rates and use the money to invest in hardware and software robots to fire workers. Excessively low rates also punish savers and those on fixed income.

Bernanke:  Payroll employment has now expanded by about 6 million jobs since its low point, and the unemployment rate has fallen 2-1/2 percentage points since its peak.

Mish: Even if those were all full-time jobs, this was a very anemic recovery by historic standards.

Bernanke: Despite this improvement, the job market remains weak overall: The unemployment rate is still well above its longer-run normal level, rates of long-term unemployment are historically high, and the labor force participation rate has continued to move down. Moreover, nearly 8 million people are working part time even though they would prefer full-time work. High rates of unemployment and underemployment are extraordinarily costly: Not only do they impose hardships on the affected individuals and their families, they also damage the productive potential of the economy as a whole by eroding workers' skills and--particularly relevant during this commencement season--by preventing many young people from gaining workplace skills and experience in the first place.

Mish: That is a reasonably accurate set of statements but nowhere does the Fed admit its role in creating those conditions with its boom-bust, moral-hazard monetary policies.

Bernanke: The loss of output and earnings associated with high unemployment also reduces government revenues and increases spending on income-support programs, thereby leading to larger budget deficits and higher levels of public debt than would otherwise occur.

Mish: The fiscal deficit is high because of perpetual overspending by Congress on top of the Fed's boom-bust, moral-hazard monetary policies.

Bernanke: Consumer price inflation has been low. The price index for personal consumption expenditures rose only 1 percent over the 12 months ending in March, down from about 2-1/4 percent during the previous 12 months. This slow rate of inflation partly reflects recent declines in consumer energy prices, but price inflation for other consumer goods and services has also been subdued. Nevertheless, measures of longer-term inflation expectations have remained stable and continue to run in the narrow ranges seen over the past several years. Over the next few years, inflation appears likely to run at or below the 2 percent rate that the Federal Open Market Committee (FOMC) judges to be most consistent with the Federal Reserve's statutory mandate to foster maximum employment and stable prices.

Mish: The Fed has no idea what inflation is or why because the Fed ignores asset bubbles in stocks, in bonds, and in houses. It uses fatally flawed definitions of inflation, inaccurately measured at that.

Berrnanke: Over the nearly four years since the recovery began, the economy has been held back by a number of headwinds. Some of these headwinds have begun to dissipate recently, in part because of the Federal Reserve's highly accommodative monetary policy. Notably, the housing market has strengthened over the past year, supported by low mortgage rates and improved sentiment on the part of potential buyers. Increased housing activity is fostering job creation in construction and related industries, such as real estate brokerage and home furnishings, while higher home prices are bolstering household finances, which helps support the growth of private consumption.

Mish: Housing sentiment has indeed improved, but that is of course what happens when central banks artificially suppress rates with the purposeful intention of creating asset bubbles, not to help consumers, but to bail out banks still stuck with housing inventory they need to unload.

Bernanke: Over the past four years, state and local governments have cut civilian government employment by roughly 700,000 jobs, and total government employment has fallen by more than 800,000 jobs over the same period. For comparison, over the four years following the trough of the 2001 recession, total government employment rose by more than 500,000 jobs.

Mish: At best, that's a start. And it fails to address untenable union wages and benefits and absurd collective bargaining agreements of public workers.

Bernanke: At the same time, though, fiscal policy at the federal level has become significantly more restrictive. In particular, the expiration of the payroll tax cut, the enactment of tax increases, the effects of the budget caps on discretionary spending, the onset of the sequestration, and the declines in defense spending for overseas military operations are expected, collectively, to exert a substantial drag on the economy this year. The Congressional Budget Office (CBO) estimates that the deficit reduction policies in current law will slow the pace of real GDP growth by about 1-1/2 percentage points during 2013, relative to what it would have been otherwise. 

Mish: It is preposterous to whine about pissy cuts in spending when the cuts have all been back-end loaded, and there are no real cuts in the first place. Congress did not really cut anything. It decreased the amount of expected budget increases and called that a cut.

Bernanke: In present circumstances, with short-term interest rates already close to zero, monetary policy does not have the capacity to fully offset an economic headwind of this magnitude.

Mish: Headwinds? From non-existent cuts? From a rollback of tax cuts that should never have happened in the first place?

Bernanke: Although near-term fiscal restraint has increased, much less has been done to address the federal government's longer-term fiscal imbalances. Indeed, the CBO projects that, under current policies, the federal deficit and debt as a percentage of GDP will begin rising again in the latter part of this decade and move sharply upward thereafter, in large part reflecting the aging of our society and projected increases in health-care costs, along with mounting debt service payments. To promote economic growth and stability in the longer term, it will be essential for fiscal policymakers to put the federal budget on a sustainable long-run path.

Mish: Note the blatant hypocrisy of Bernanke whining about non-existent cuts and about tax rollbacks the country could not afford, while warning Congress that something must be done to put the federal budget on a sustainable long-run path.

Bernanke: Importantly, the objectives of effectively addressing longer-term fiscal imbalances and of minimizing the near-term fiscal headwinds facing the economic recovery are not incompatible. To achieve both goals simultaneously, the Congress and the Administration could consider replacing some of the near-term fiscal restraint now in law with policies that reduce the federal deficit more gradually in the near term but more substantially in the longer run.

Mish: Yeah, right. Like what? Of course that's not his problem. He just begs Congress to kick the can down the road, which of course is all the Fed ever does too, while ignoring every asset boom-bust cycle along the way.

Bernanke: With unemployment well above normal levels and inflation subdued, fostering our congressionally mandated objectives of maximum employment and price stability requires a highly accommodative monetary policy. Normally, the Committee would provide policy accommodation by reducing its target for the federal funds rate, thus putting downward pressure on interest rates generally. However, the federal funds rate and other short-term money market rates have been close to zero since late 2008, so the Committee has had to use other policy tools. The first of these alternative tools is "forward guidance" about the FOMC's likely future target for the federal funds rate.

Mish: Got that? Forward guidance is supposedly a tool. In reality, the Fed is totally clueless about the economy, about housing, about jobs, and about where interest rates should be (as directly evidenced by repeat bubble-blowing exercises).

Bernanke: The second policy tool now in use is large-scale purchases of longer-term Treasury securities and agency mortgage-backed securities (MBS). These purchases put downward pressure on longer-term interest rates, including mortgage rates. For some months, the FOMC has been buying longer-term Treasury securities at a pace of $45 billion per month and agency MBS at a pace of $40 billion per month. The Committee has said that it will continue its securities purchases until the outlook for the labor market has improved substantially in a context of price stability. The Committee also has stated that in determining the size, pace, and composition of its asset purchases, it will take appropriate account of the likely efficacy and costs of such purchases as well as the extent of progress toward its economic objectives.

Mish: Note the dual mandate nonsense of jobs and inflation. It is impossible for bureaucrats and central planners to target one factor of the economy accurately. Two is insane. Yet, price stability is easy enough to achieve. Simply get rid of the Fed and fractional reserve lending. Here are some links on the absurdity of dual mandates.

Bernanke: At its most recent meeting, the Committee made clear that it is prepared to increase or reduce the pace of its asset purchases to ensure that the stance of monetary policy remains appropriate as the outlook for the labor market or inflation changes.

Mish: That makes sense (in a perverse sort of way). The Fed has no idea what it is doing so it needs to be prepared to do anything. Also note the irony of being prepared to do anything while promoting "forward guidance" as a tool.

Bernanke: In the current economic environment, monetary policy is providing significant benefits. Low real interest rates have helped support spending on durable goods, such as automobiles, and also contributed significantly to the recovery in housing sales, construction, and prices. Higher prices of houses and other assets, in turn, have increased household wealth and consumer confidence, spurring consumer spending and contributing to gains in production and employment. Importantly, accommodative monetary policy has also helped to offset incipient deflationary pressures and kept inflation from falling even further below the Committee's 2 percent longer-run objective.

Mish: What a bunch of self-serving nonsense. Higher asset prices have primarily benefited the wealthy. For discussion, please see Who Won? the 93% or the 7%? Why?

Moreover, Bernanke does not understand the simple math of 2% inflation over time. When wage growth does not keep up, and it hasn't, huge economic distortions arise along with dependency on food stamps, disability, and other programs. In short, 2% stability, is very destabilizing. I spoke about this at length in Fallacy of Inflation Targeting.

Here is the key chart.

Inflation Targeting at 2% a Year



Over time, prices rise, but wages for the masses do not. Worse yet, Bernanke's cheap money philosophy makes matters worse because it encourages businesses to invest in hardware and software robots that will enable companies to fire more workers.

There are no benefits of artificially low rates, at least to the average worker.

Economist Steve Keen commented on that chart in Exponential Credit Petri Dish; Steve Keen Responds to "World Economic Forum Endorses Fraud" Post

Bernanke: That said, the Committee is aware that a long period of low interest rates has costs and risks. For example, even as low interest rates have helped create jobs and supported the prices of homes and other assets, savers who rely on interest income from savings accounts or government bonds are receiving very low returns. Another cost, one that we take very seriously, is the possibility that very low interest rates, if maintained too long, could undermine financial stability. For example, investors or portfolio managers dissatisfied with low returns may "reach for yield" by taking on more credit risk, duration risk, or leverage.

Mish: The committee would not recognize risk if it jumped up and spit in Bernanke's face. Low interest rates have already undermined future financial stability by encouraging "reach for yield" excessive credit risk, duration risk, and leverage.

Bernanke: Because only a healthy economy can deliver sustainably high real rates of return to savers and investors, the best way to achieve higher returns in the medium term and beyond is for the Federal Reserve--consistent with its congressional mandate--to provide policy accommodation as needed to foster maximum employment and price stability. Of course, we will do so with due regard for the efficacy and costs of our policy actions and in a way that is responsive to the evolution of the economic outlook.

Mish: Bernanke took one last opportunity to hide behind a ridiculous dual mandate while turning a blind eye to the destabilizing asset bubbles it creates.

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

Abenomics in Review: Yen, Inflation, Exports, Imports

Posted: 22 May 2013 12:52 AM PDT

With the Yen collapsing vs. all other currencies, inquiring minds may be wondering how prime minister Shinzo Abe's inflation policy is working out in practice. Let's start with a look at the Yen.

Yen Daily Chart for One Year



In the last year, the Yen has fallen from 124.79 to 97.56. That is a decline of 21.82%. Recall that Abe's policy is an attempt to raise inflation and spur exports.

Japan Still in Deflation

On May 19, Reuters reported Japan's Amari: core core CPI showing signs of turning positive due to BOJ.
Japanese Economics Minister Akira Amari said on Monday that core-core consumer prices, which exclude fresh food and energy, are showing signs of turning positive due to the Bank of Japan's aggressive monetary easing. Amari, speaking to reporters, also said the government still judges Japan to be in mild deflation as other measures of consumer prices are still falling when compared to the same period a year ago.
Fancy that. Consumer prices are still falling in spite of a 21% plunge in the currency. OK, but what about exports and imports?

Good question. I'm Glad you asked.

Japan Exports Disappoint

Please consider Japan Exports Disappoint, Full Benefits of Weak Yen Yet to Show
Japan's exports rose less than expected in April from a year earlier due to weak demand from Europe and China, highlighting the challenges confronting the world's third-biggest economy as policymakers try to engineer a sustained revival.

The 3.8 percent annual increase in exports in April was below the median estimate for a 5.9 percent rise and followed a 1.1 percent increase in the year to March.

The result also underscores the limitations of a weak yen in bolstering the trade sector, especially as external headwinds crimp demand for exports.

The uncertainty was underlined recently by a string of weak data from the United States and China, Japan's major export markets.

Imports jumped 9.4 percent year-on-year in April, up for a sixth straight month, due to an increase in liquefied natural gas purchases, compared with a 6.7 percent gain expected by economists.

That has brought the country's trade balance into a deficit of 879.9 billion yen, the biggest trade gap for the month of April under comparable data series going back to 1979, according to the finance ministry.

It compared with the economists' forecast for 621.1 billion yen deficit, leaving the trade balance in the red for ten months in a row, the longest such run since 1979-1980 when Japan was hit by surging oil prices.
Abenomics Synopsis

  • Year-over-year the is Yen down 21.82% vs. the US Dollar
  • Japanese consumer prices are still falling
  • Imports jumped 9.4%, up for a sixth straight month
  • Exports up 3.8%
  • Trade balance negative for 10 straight months
  • Largest April trade deficit since 1979

People think Shinzo Abe is a hero because the Nikkei is up.

I think Abe is an absolute economic nutcase who is going to create a currency crisis in Japan if he succeeds in changing the constitution like he desires (and quite possibly even if he doesn't).

For further discussion, please see Will Shinzo Abe Succeed with Constitutional Changes to Militarize Japan and Further Destroy the Yen?

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