Central Perk

marți, 13 decembrie 2011

Interactive Timeline: Ending the War in Iraq

Your Daily Snapshot for
Tuesday, Dec. 13, 2011

Interactive Timeline: Ending the War in Iraq

Before the year ends, the last of our troops will cross the border and return home. After nine years, the war is over.

Check out the timeline of the Iraq war:

SEOptimise

Can Meeting Your Followers Face-to-Face Increase Loyalty?

Posted: 13 Dec 2011 04:35 AM PST

A few days ago I was looking through my mentions on Twitter and I noticed a rough correlation between the strength of relationship I have with a person and the frequency/consistency of their interaction with me. I also noticed that strength of relationship was in rough correlation to the medium(s) that I've communicated with them on. In other words, the followers who I'd only spoke to over e-mail or Twitter weren't interacting with me as often as those who I'd met in real life.

It got me thinking: if the depth of a relationship impacts frequency of interaction online, and the medium in which I communicate with people on impacts the depth of relationship, is it possible to increase the loyalty of your followers by meeting them face-to-face?

How real are you to your Twitter followers? Image Credit: Aristocrats-hat

Meeting Face-to-Face Increases the Likelihood of Social Interaction, IF You Have Shared Interests.

When you meet someone face-to-face, you become more likely to then interact with them online, providing that you have shared interests and consider them to add value to your newsfeed. Having met someone in real life is a 'filter' that some people (subconsciously) use to prioritise who they interact with socially.

I decided to ask my followers what they thought about whether meeting someone in real life improves the likelihood of engaging with them on Twitter afterwards. The general consensus was that most people found meeting someone face-to-face does have a positive impact on interaction on Twitter.

Can Skype Increase the Loyalty of Your Audience?

Nowadays, the process of meeting someone has become more of a spectrum than a binary choice, as you can virtually meet people through video calls, instant messaging and audio technology.

Research has proven that the use of voice and video communications helps when building relationships. What this means is that hypothetically if you were to Skype someone, they'd be more likely to interact with you in the future than if you were to have solely had correspondence over e-mail or Twitter.

I personally love Skype and use it regularly as a way of getting to know new people whose blogs I find interesting or tweets I enjoy. I find that it adds so much more context to the relationship I end up building with that person, as quite often I will end up finding something I have in common with that person or learning about the interesting things that they're up to.

Skyping with one person a week will increase your followers’ loyalty
I strongly recommend Skype as a means of getting to know your followers. Deepening your relationships with your followers will not only allow you to get to know your audience, but it will also increase the interaction you have with your followers and they have with you. I recommend trying to put aside a little bit of time each week to having a Skype call with your followers, even if it's just one call a week.

Final Thoughts – How Many of Your Most Loyal Followers Have You Met?

I ran some data on my Twitter followers and found out that I've met 80% of my ten most loyal Twitter followers (those who retweet me the most) in real life. I asked around the office and on Twitter and the general consensus was that most people had met between 60 – 90% of their most loyal Twitter followers (the average being 76%). Although based on a small sample size, I think it's fair to assume that for most of us, the people who interact with us the most are those who we meet in person. Which, if you turn it around, makes a lot of sense – those who we share the most interests with (and thus interact with online) are the people we're most likely to meet and develop relationships with in person.

A big thanks to Stuart Duff, Richard Fergie, James Carson, Eloi Casali, Gavin Llewelyn, Bas Van Den Beld, Ruben Martinez, and the SEOptimise team for inputting into this post!

Agent Rank: Google’s Internal Klout Score

Posted: 09 Dec 2011 04:18 AM PST

Recently I've written about Klout score optimisation. Since then I and others who outed themselves as actively using Klout have been attacked by self proclaimed SEO stars and other people who seemingly "hate Klout". Can you hate a metric? Obviously people get very emotional when it comes to Klout.

Klout measures the social media influence of people. While it fails at determining your real life influence, it's quite accurate for measuring how active and influential you are on social media, including Facebook, LinkedIn, Twitter and Google+.

That's why some people hate Klout: they are only influential within a small closed group, while they have never shared enough with the general public on social media to get appreciation from the masses.

What did I say when people ridiculed me for using Klout to determine people's influence? I said that I am quite sure that Google internally has a similar system of finding out who exerts influence on the social web and who does not. It wasn't a very daring prediction, it was just an extrapolation based on the steps Google has undertaken in the past. Google has already been focusing on authorship, real names and the social graph for a while.

Now Bill Slawski has written an article on the reputation systems Google uses, might use or will use in the future. There are three mentioned in the post. The most interesting one is the Agent Rank. Not only does the name sound familiar and self-explanatory to some extent, but it's also a patent Google has filed. It most probably gets or will be used for Google +1 votes.

The Agent Rank patent does not describe in detail how such Agent Rank might rank people, but the other papers mentioned above suggest a few ways to determine trust on a collaborative social site. At Wikipedia for example:

"Users gain reputation when they make edits that are preserved by subsequent authors, and lose reputation when their work is partially or wholly undone."

What does this mean? Opportunism and mainstream opinions pay off.

This is similar to early Web 2.0 sites such as Digg or Hacker News, where a few dominant users gained reputation by submitting content from sites everybody likes and agrees on. Back then it was TechCrunch, for example. I have seen this phenomenon on my first generation social sites.

The more "one size fits all" and "smallest common denominator" a page was, the more likely it succeed.

With it the submitter succeeded as well. Thus people were always in a race to submit TechCrunch articles. The ones who submitted the most TechCrunch articles were the most reputable.

I've seen a similar phenomenon on the newer social sites you couldn't game as easily, people submitting all stories by the

NYT
Mashable
Search Engine Land
SEOmoz

or whatever the main authority in your field is. Most automated accounts do it. They gain authority by simply feeding RSS feeds of popular sites to Twitter, even though nobody clicks the links.

I can see because I see the stats from my blogs that get retweeted by these bots, the bit.ly stats for the URLs and the reputation metrics of these bot accounts. Many of them were able to game Topsy algorithm. Topsy is not as exact as Klout: they just have three different kinds of user not influential ones, influential ones and highly influential ones.

Google will measure trust with more complexity than Klout

I guess but elements from all the measurement system above will be among the likely factors. We're still in a very early phase of this, but it's already clear that Google does not want to trust websites anymore but authors instead.

The insistence on real names and the many incentives to verify your identity on Google services all point in the same direction: Google will focus more on people than on websites in the future. Thus an author publishing a completely new website will be able to push it quickly to the top or at least the article they transfer their reputation to.

Also, the more reputable documents and pieces of content you support, the more reputable you get. As on Klout, it will be most likely the sheer activity that will make you more trustworthy. Google's Agent Rank won't be able to compute your reputation just based on one or two articles and a few votes.

The more you participate and the more content you create, the more you will become an authority. In the long run, Google will have to focus more and more on real authority that is not the sheer number of votes. In the beginning the search giant has no choice. It has to reward sheer activity as it doesn't have enough users, votes and other social signals yet.

You may have noticed that I use terms such as

reputation
trust
authority
influence

quite interchangeably in this article. As of yet, there is no clear standard on the web for measuring the worth or value of one's contributions. We already know that neither model is perfect yet but that the importance of measuring people and not websites is growing.

You don't have to be a prophet to extrapolate the most likely ranking signals for people Google will have to use. Consider these:

Activity – as noted above, you can't measure something where there is nothing – without activity there is not enough to measure. On the other hand there will be some limits to that. We know that having a million followers on Twitter does not necessarily mean that you are more important. Also, sending 50 automated messages a day may be too much.

Altruism – nobody, either on social media or in real life, likes constant self-promotion. Many marketers still get that wrong. You get what you give. Science has proven that only through altruism can the whole species survive. Algorithms can't rely on egoists to offer the best advice, as there would be no popularity at all: everybody would just promote their own works. So it has to count the other people who share content, with whom they have no direct connection.

Authority – one of the reasons why Google succeeded in becoming the biggest search engine in the world is its reliance on authority. The more experts consider something to be a good resource, the better. It worked for a while with websites, as the original PageRank formula reflected the reputation model of the traditional scientific community. The more a document got cited, the better. We know that it's no longer enough, ever since Google has been the leading search engine. PageRank could be gamed quite easily with paid links. You can't bribe thousands of people as easily as you can pay for a few links though.

Expertise – authority can't be measured without measuring expertise as well. You can get very popular despite being dead wrong. So an Agent Rank will have to measure whether a given author gets supported by thousands or even millions of people who have no clue or whether they get supported by a few experts who are really knowledgeable in a given area of expertise.

Impartiality – just consider a Google +1 user who constantly votes up Fox News. Can Google count on this person to be an expert on news? Well, most probably the algorithm will consider such a user just an expert on US conservative views. In contrast, consider a user who gives +1 to all kinds of resources, including CNN, BBC, Al Jazeera etc. Will this user be more of an impartial expert?

Popularity – you may be right, but as long as you don't tell the world or convince more than a bunch of bookworms who do nothing else than deal with the issue all day, it won't be sign of influence. You have to be able to appeal to the masses. Google already favours Wikipedia in its results not because it's always the best results, but because most people can get that. Whether you search for SEO, film or God, Wikipedia will show up on top. You will surely agree that there are bigger authorities or better results for all three examples.

Quality – the aforementioned factor; mass appeal can be easily gamed though. We have seen content farms embrace the shallow but popular approach over the years until Google has to curb it. Quality will have to be measured as well. How can quality be determined? This is very difficult, I could write a huge post about this. The on-going Google high quality update, aka Panda, has been about it in 2011. The quality of published and voted for texts by authors will have to be determined by a complex mix of signals itself.

Reputation – someone can have mass appeal, be considered an expert by other experts, even be considered an authority. The reputation of this person can still be a nightmare. Just think about people like Jason Calacanis, Derek Powazek or Steve Rubel who declared SEO dead or rubbish. They are not even famous – they are infamous. People know them because they shout louder than others. So their reputation is awful no matter how much they can game other simpler social media metrics.

Topicality – as you see above these "experts" who indeed have enormous mass appeal, gained great success from their anti-SEO rants when measured by sheer reach and attention. Most of their other contributions haven’t been about SEO at all. So an Agent Rank will have to measure whether you are an expert on SEO, gardening or homeopathy. For example, Klout assumes I'm an expert on homeopathy because I've been involved in many online arguments with people who never tried it but attempt to convince me that it cannot work.

Trust – trust is not influence and not reputation either. Trust is about telling the truth, being reliable and not tricking people in order to gain something. How on earth do you measure that? You can be trustworthy without being influential or without having a reputation. You don't need to be an expert or have mass appeal to be trustworthy either. It's a very important but easy to grasp concept. Nonetheless you need it to survive, and Google will have to measure it as well. Can a person be trusted not to favour their own clients, colleagues or advertisers? Most people will have a bias. The less bias the better to determine a good resource or author. So Google will have to measure the trust other people ascribe to you.

Velocity – news that spreads fast is in many cases more important than news that spreads slowly. Of course this signal is not enough in most cases. Is the royal wedding or Osama Bin Laden's death really the most important news? It depends on many other factors. The speed with which articles by a particular author or social media user spread is one metric that has to included among the above as well. Some ideas need a decade or a century to spread; they aren't less important, they just need more time, but in many cases there’s a reason viral ideas spread like wildfire. Google will have to measure velocity, as it already does with breaking news.

It's a huge task to measure these abstract concepts, but at the end of the day they determine how important a person, a source or a document is.

Some old school SEOs who are envious of the social media influence of more active users frantically try to outpace the competition by making their employees vote them up on social sites or by bragging that they work for big brands and only accept the highest quality.

Telling people is not enough these days; you have to show or rather offer this quality while sharing your know-how free of charge, otherwise others will do it. Most people will look at the measurable social proof and not the clandestine contracts you have with a large corporation. Google will likewise care more for what other people say about you than what you say yourself or make your employees tell the world.

Already there are tendencies such as selling employee attention to the highest bidder as Walmart does with its more than one million underpaid workers. Google will have to determine quickly whether there are voting patterns between a particular group of people.

Still I'm quite optimistic, overall; authors will be judged by what they give to the world, not what they sell to a chosen few. That's a great way to find out what's important. I believe that 99% of the people know better than just the top 1%.

Let’s just hope that Google doesn’t mistake mob mentality for democracy.

Seth's Blog : Insulate yourself...

Insulate yourself...

from anonymous angry people

Expose yourself to art you don't yet understand

Precisely measure the results that are important to you

Stay blind to the metrics that don't matter

Fail often

Ship

Lead, don't manage so much

Seek out uncomfortable situations

Make an impact on the people who matter to you

Be better at your baseline skills than anyone else

Copyedit less, invent more

Give more speeches

Ignore unsolicited advice

• Email to a friend •

luni, 12 decembrie 2011

Mish's Global Economic Trend Analysis

Cameron Attempts to Snatch Defeat from Jaws of Victory; Euro Project Intellectually, Morally, Democratically Bankrupt
Hussman as Short-Term Bearish as He Gets; What About the Long-Term Picture? Three Key Points
Will Sarkozy Survive the First Round in French Elections? Regardless, Sarkozy's Replacement Will Be Worse; Socialist challenger François Hollande Would Renegotiate EU Deal; Bickering Before Ink is Dry
Hell Will Freeze Over Before Finland Signs Treaty; Europe's Blithering Idiots Make UK the Lone Winner

Cameron Attempts to Snatch Defeat from Jaws of Victory; Euro Project Intellectually, Morally, Democratically Bankrupt

Posted: 12 Dec 2011 08:52 PM PST

It is disgusting to see UK Prime Minister David Cameron all but throw away the victory he achieved when he vetoed the Merkozy treaty.

Please consider these sniveling, apologetic snips from the New York Times article Cameron Says His Veto on Europe Treaty Protects Britain

Mr. Cameron, a Conservative, seemed at pains to offer soothing words to those afraid that he had so alienated his European allies that Britain was bound to leave the European Union altogether.

"Britain remains a full member of the E.U., and the events of the last week do nothing to change that," Mr. Cameron said. "Our membership of the E.U. is vital to our national interest. We are a trading nation, and we need the single market for trade, investment and jobs."

Olli Rehn, the European commissioner for economic and monetary affairs, said Britain could hardly wall off its financial industry, the bustling City of London. "I regret very much that the United Kingdom was not willing to join the new fiscal compact, as much for the sake of Europe and its crisis response as for the sake of British citizens and their perspectives," Mr. Rehn said. "We want a strong and constructive Britain in Europe, and we want Britain to be at the center of Europe, and not on the sidelines. If this move was intended to prevent bankers and financial corporations in the City from being regulated, that is not going to happen."

Mr. Rehn also offered a reminder that Britain had approved "the six-pack of new rules tightening fiscal and economic surveillance" that goes into force on Tuesday. "The U.K.'s excessive deficit and debt will be the subject of surveillance like other member states," he said, "even if the enforcement mechanism mostly applies to the euro area member states."

Mr. Cameron faced a few gentle questions about whether to hold a national referendum on Britain's membership in the European Union, something the anti-Europe faction dearly wants, he batted them briskly away.

Threats From Rehn

Clearly Olli Rehn will stop at nothing to get what he wants, and by sucking up to the EU, Cameron practically admits he is willing to sell the UK down the river next time, for a few useless promises.

UK not to Blame

Telegraph writer Boris Johnson nails it with We're right about the euro - that's why Europe is angry

I know some people are unsettled to see all these powerful Europeans getting so very, very cross. Angela Merkel has said that we weren't even negotiating properly. Nicolas Sarkozy can hardly bring himself to mention Britain by name and has been filmed apparently refusing to shake David Cameron's hand. Across the Continent, the papers are full of wrathful headlines about the general arrogance and stupidity of the Englanders/Anglais/Inglesi. I watched some poor Lib Dem Euro MP who seemed about to explode with disgust at the UK's handling of the recent summit.

And there must be many people in this country who find themselves a bit spooked by the vitriol of the criticism. For some days, the BBC has been telling us in sepulchral tones that we are "isolated" and "marginalised" – as if a decision had been taken to abandon us in our misty island like a bunch of woad-painted savages.

Now look. It wasn't the Anglo-Saxon bankers who caused the trouble in the eurozone, Sarkozy mon ami. It was the utter failure of the eurozone countries – starting with France, incidentally – to observe the Maastricht rules. It was the refusal of the Greeks to control their spending or to reform their social security systems. In Greece and Italy, the democratic leaders have been effectively deposed in the hope of appeasing the markets and saving the euro; and what makes the leaders of the eurozone countries even more furious is that it doesn't seem to be working.

They blame David Cameron for "vetoing" a new EU treaty, when really he has done no such thing. It is perfectly open to the other EU countries now to go ahead and form their own new fiscal rules. If they want, they can decide to create an economic government of Europe. They may decide that now is the time – even though electorates are already feeling alienated from the political process – to hand sensitive decisions on tax and spending to unelected bureaucrats. It strikes me that this would be an amazingly dangerous thing to do, since the peoples of this Supra National And Fiscal Union (Snafu) would rapidly discover that they could no longer remove their government from office. I doubt very much that it would work, since there seems no particular reason why national governments should respect a collection of new "binding" rules any more than they respected the "binding" rules of Maastricht – not unless there is some secret proposal to enforce them by violence with a Euro-army.

But even if the Snafu has little prospect of success, there is no reason for David Cameron to commit this country to a project that is intellectually, morally and democratically bankrupt.

Intellectually, Morally and Democratically Bankrupt

Indeed the Euro project is exactly as Boris Johnson describes. And that is precisely why Cameron should have gone on the offensive and put membership in the EU to popular vote instead of making sniveling, apologetic statements to appease Merkel and Sarkozy, both of whom will be gone after the next set of elections.

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

Hussman as Short-Term Bearish as He Gets; What About the Long-Term Picture? Three Key Points

Posted: 12 Dec 2011 11:31 AM PST

I cannot recall a time when fund manager John Hussman as short-term bearish as he is now.

The title of his recent article says it all: Hard-Negative

With the exception of extreme market conditions (see Warning- Examine All Risk Exposures , and Extreme Conditions and Typical Outcomes ), I try not to wave my arms around about near-term market risks, but I think it's important to cut straight to the chase here. The present market environment warrants unusual concern, in my view. Based on a wide variety of evidence and its typical market implications over an ensemble of dozens of subsets of historical data, the expected return/risk profile of the stock market has shifted to hard-negative. This places us in a tightly defensive position. This isn't really a forecast in the sense that shifts in the evidence even over a period of a few weeks could move us to adjust our investment stance, but here and now we observe conditions that have often produced abrupt crash-like plunges. This combination of evidence includes elevated valuations, overbullish sentiment, market internals best characterized as a "whipsaw trap" on the basis of typical follow-through, heightened credit strains, and clear evidence (on reliable forward-looking indicators) of oncoming recession, among other factors.

Long-Term Too Bullish?

It's important to note that Hussman is not making a prediction. Rather it's Hussman's assessment that the risk-reward setup at the present time merits extreme caution. I share that view.

It's the next few paragraphs where I wonder if Hussman is actually over-bullish.

On a valuation front, we estimate that the S&P 500 is likely to achieve an average total return over the coming decade of about 4.8% annually. This is certainly better than the projected returns that we have observed over much of the past decade, but then, the past decade has produced virtually no total return for equity investors at all.

click on chart for sharper image

We estimate that the S&P 500 would have to trade at about the 800 level in order to achieve 10-year prospective returns of 10% annually. Importantly, even a magical "fix" out of Europe would do nothing to change that algebra.

Is 60 Years Long Enough?

I am wondering if 60 years is long enough. We have had huge PE expansion-contraction cycles in both directions in the past 60 years but there has not been...

Consumer Deleveraging Cycle
Negative Demographic Shock

Might it be the case the US stock market follows something more like the Nikkei? Certainly, even if it is not that extreme.

Negative Returns for a Decade?

Let's revisit a table I posted in Negative Annualized Stock Market Returns for the Next 10 Years or Longer? It's Far More Likely Than You Think, on February 7, 2011.

Annualized Rates of Return with Starting PE 21 or Greater
Year	PE	AR 1	AR 10	AR 20
1901	22.7	9	4	3
1902	22.0	-12	4	3
1928	21.3	33	-2	2
1929	27.6	-16	-4	0
1930	21.5	-30	-3	1
1964	22.6	7	1	4
1965	23.3	-3	0	5
1966	21.3	8	2	6
1967	21.6	7	1	7
1968	21.5	0	1	6
1995	22.7	21	7	?
1997	31.0	19	4	?
1998	36.0	18	1	?
1999	42.1	4	-1	?
2000	41.7	-17	?	?
2001	32.1	-16	?	?
2002	25.9	-2	?	?
2003	24.1	17	?	?
2004	26.4	7	?	?
2005	26.0	9	?	?
2006	26.0	13	?	?
2007	26.8	-16	?	?
2010	23.0	?	?	?

Variance over Time

The first year rate-of-return ranges from -30 to +33.
The annualized rate-of-return for the first decade ranges from -4 to +7.
The median rate-of-return for the first decade is +1.

That median rate of return going forward will be influenced in an unknown but likely negative fashion from the current starting point and high PE valuations for the years that have yet to be determined.

Annualized Rates-of-Return Starting PE Less Than 13

The following table shows annualized rates-of-return for the current year, the 10th year, and the 20th year for each year in which the PE started at 13 or lower.

Annualized Rates of Return with Starting PE 13 or Less
Year	PE	AR 1	AR 10	AR 20
1913	11.9	-3	4	4
1914	11.1	7	5	5
1915	11.5	18	7	5
1916	12.0	-3	7	6
1917	8.8	-7	10	6
1918	6.4	20	14	7
1919	6.5	-5	15	5
1920	5.3	-11	13	5
1921	5.4	26	10	5
1922	7.5	6	1	3
1923	7.9	9	4	5
1924	8.4	26	4	5
1925	10.1	16	2	4
1926	11.7	24	5	4
1932	8.1	32	5	9
1933	11.1	13	5	8
1934	12.2	9	5	8
1942	9.2	34	13	11
1943	11.0	10	10	10
1944	11.3	21	11	10
1947	11.2	5	12	10
1948	10.7	2	12	10
1949	9.9	24	5	4
1950	11.2	24	15	10
1951	12.0	23	12	9
1953	12.0	21	10	9
1974	10.9	5	8	9
1975	10.2	19	9	10
1976	11.5	-2	10	10
1977	10.4	0	12	11
1978	9.4	9	11	12
1979	8.9	16	12	12
1980	8.8	10	10	12
1981	8.5	-5	11	10
1982	7.3	33	12	9
1983	9.6	1	10	8
1984	9.4	17	10	9
1985	10.7	25	10	8

Variance over Time

The first year rate-of-return ranges from -11 to +34.
The annualized rate-of-return for the first decade ranges from +4 to +15.
The median rate-of-return for the first decade is +10.

Three Key Points

Starting valuation matters
Starting valuation is bad
The median rate-of-return for the first decade with these starting valuations is +1

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

Will Sarkozy Survive the First Round in French Elections? Regardless, Sarkozy's Replacement Will Be Worse; Socialist challenger François Hollande Would Renegotiate EU Deal; Bickering Before Ink is Dry

Posted: 12 Dec 2011 09:47 AM PST

French elections are done in two rounds. The top two candidates by popular vote square off in round two. Things do not look good for French president Nicolas Sarkozy, especially for round two. However, he may not make it that far.

Le Parisian has the results of the latest French Election Polls.

Round 1

François Hollande 31.5%;
Nicolas Sarkozy 26%;
Marine Le Pen 13.5%;
Francois Bayrou 13%

Round 2

François Hollande 57%
Nicolas Sarkozy 43%

The gap between Hollande and Sarkozy in the first round is deceptively close. The reality is Sarkozy would lose handily if it came down to those candidates. Euroskeptic Marine Le Pen has fallen quite a bit but the first round race may change significantly as a result of recent political developments.

Reader Andrea writes ...

Hello Mish

Over then last days a few significant things happened for the French presidential elections.

Bayrou declared himself officially a candidate: Bayrou is the center of the political landscape and after his declaration and the media coverage he had, the polls showed quite a strong increase of his possible score. Now we have to see if it will hold, increase or if it is just a temporary effect of this media coverage.

He surged six points in the latest poll. in the last elections he got more than 18% of the first round vote.

The most interesting piece of news is that former prime minister Dominique de Villepin has declared this weekend he will be candidate.

De Villepin is from the right-wing side and he was member of Sarkozy's party until a few months ago. He left to create his own party and actually the relations between the 2 have always been very bad. The announcement was quite surprising because it seemed that de Villepin had abandoned the idea to be candidate.

This could be another issue for Sarkozy because for sure almost any vote de Villepin will get will be a vote that otherwise would have gone to Sarkozy, and could be a danger for his position at the first round.

For the moment there are no polls made after the announcement and his media coverage. So let's see what will be the impact of this in a few days. In my opinion there are increasing odds to see a situation with several candidates of the centre-right part political parties having a very close position and therefore an uncertain first round result.

Sarkozy may be bumped off in round one as a result.

Sarkozy's Replacement Will Be Worse

The unfortunate irony is that as bad as Sarkozy is, Hollande would be worse. Please consider Socialist challenger François Hollande would renegotiate EU deal

François Hollande, who is the Socialist Party candidate for next year's presidential elections in France and currently leading in opinion polls, says if he were elected he would re-negotiate last week's EU fiscal pact.

François Hollande said he would renegotiate the pact to add what he said was missing from the deal. "I'd see to it that we add…ECB intervention, Eurobonds and a financial bail-out fund to respond to what is today the pressure of the markets"

All of these measures were explicitly opposed by Germany in the run-up to last week's deal.

Hollande's Socialists have accused Sarkozy of capitulating to German pressure, while he has accused them of undermining French policy by criticizing the deficit reduction plan.

Got that?

Hollande wants

ECB intervention
Eurobonds
Financial Bail-Out Fund

Bickering Before Ink is Dry

The ink is not even dry yet and already the likely next president of France vows to renegotiate the terms in a manner unacceptable to Germany, Finland, the Netherlands.

Round one of the presidential election is April 22. Round two is May 6. Given the situation in Finland, there may not be a deal even on paper (and certainly not signed), by the time Sarkozy is booted. Then the process can start all over again with another summit. After Merkel is booted, the process can again start fresh.

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

Hell Will Freeze Over Before Finland Signs Treaty; Europe's Blithering Idiots Make UK the Lone Winner

Posted: 12 Dec 2011 01:32 AM PST

Reader Janne from Finland claims "hell will freeze over" before Finland signs the Merkozy deal as it is structured right now. Janne also claims Finland will "loan" money to the IMF and it will not be in the budget.

From Janne ....

Hello Mish

My collection and translation of news shows this new treaty is in serious trouble.

Finance minister Jutta Urpilainen (social democrats/SDP) says Finland has only two options after the EU-summit: Either unanimity is required in ESM decisions as agreed before or Finland will drop out of ESM.

She does NOT see any other options based on the statement by Finnish Parliaments Constitutional Committee.

Loan Not Gift

Prime Minister Jyrki Katainen says that Finnish contribution to strengthening the IMF is 3.8 billion euros and this money will be a loan from the Bank of Finland to IMF so this will NOT be part of the Finnish budget.

Timo Soini,leader of the main opposition party The Finns party(PerusSuomalaiset) is very worried about the decisions made in Brussels and thinks particularly bad is the plan to remove unanimity and move to majority decisions regarding ESM.

85% Rule Against Finnish Constitution

Soini says that majority decisions in ESM are against the Finnish Constitution as confirmed recently by Finnish Parliaments Constitutional Committee. There was a clear mandate from Finnish Parliament that majority decisions in ESM are against Finnish Constitution and this EU-agreement should have never been agreed to.

If this goes through Finland will become responsible for others debts in way where we can NOT influence it or stop it. Soini thinks especially worrying is that large euro-countries may themselves withdraw from responsibility.

Germany, France and Italy can each stop the use of ESM if they so choose. This is unbelievable when smaller countries right to decide has been taken away.

Soini thinks much discussed and fiercely demanded investor responsibility(PSI) in ESM is completely watered down.

These instruments are created to remove investor responsibility and make taxpayers pay profits to gamblers.

Finland Expects Private Sector Involvement

Limiting so-called private-sector involvement to the terms accepted in International Monetary Fund bailouts was part of a package agreed upon in Brussels early today as leaders met to forge tighter economic bonds to stem the crisis according to Bloomberg and other news sources.

Reporting is different in Finland where Prime Minister Katainen said Finland got what it wanted when it comes to investor responsibility and that Private Sector Involvement will be fulfilled.

Treaty Footnotes:

"subject to confirmation by Finnish Parliament"

Finland had its own views through the EU statement . Though not the text itself, but in a footnote.

Footnotes can be found in the morning released a 7-page statement at the bottom of page 6. Here in the EU countries declare that the emergency fund EVM can act by qualified majority, 85 per cent.

A footnote states that this condition is dependent on the Finnish Parliament's approval.

Prime Minister Jyrki Katainen said earlier on Friday that Finland was the only country that opposed the proposal by qualified majority. The Constitution of Finland on Thursday, the committee said that the proposal of a qualified majority is Finnish unconstitutional.
No Support for Passage

Center-party(Keskusta) who is also in opposition joins The Finns Party(Perussuomalaiset) in opposing majority decisions in ESM as does government party Christian Democrats:

Center party parliament group leader Kimmo Tiilikainen promises NO support at all to the idea that Finland would approve majority decisions in ESM and withdraw from insisting unanimity. Katainen and Urpilainen can clean up their own mess. Center party will NOT relinquish Finnish sovereignty and Finnish decision making to countries who have repeatedly violated EU-agreements.

Christian Democrat leader and interior minister Päivi Räsänen says that Finland should NOT give up unanimity requirement in ESM.

Hell Will Freeze Over Before Finland Signs Treaty

The above snips are Janne's translations (except for one Google Translation in blockquotes, indented a second time) of stories as they appear in Finland. Janne also has some personal comments and a prediction as follows. ...

This deal is a total swindle by bankers: NO more investor responsibility, NO more Private Sector Involvement(PSI). Taxpayers will pay the profits to bankers and speculators. Democracy and Sovereignty crushed.

This deal compounds the problems by piling more debt on the fiscally irresponsible and the fiscally prudent ensuring total destruction in all countries of europe in a few years under crushing debt and continual malinvestment and destruction of competetiveness.

Taxpayers will pay the future bill IF the markets believe this newest set of fairytales and wishful thinking from the incompetent and anti-democratic EU-leadership duo Merkozy and Brussels bureaucrats.

However...

The Finnish Parliament will NOT confirm this agreement signed by Jyrki Katainen and this should have been crystal clear to the Merkozy duo before the summit because grand committee of Finnish Parliament stated this clearly in advance.

ESM is dead in the water and once again thanks to the arrogant crushers of democracy and destroyers of sovereignty Merkel and Sarkozy absolutely NOTHING has been solved.

It would require 133 seats(2/3 of parliament) to approve recent EU-agreement where unanimous decision making has been removed from ESM. Since The Finns party led by Timo Soini and Center Party are both opposed this will NOT happen.

Further the Social Democrats (In Finnish government with Coalition party and a bunch of smaller parties) have also said through Finance minister Jutta Urpilainen that they will NOT support majority decisions in ESM and one smaller party Christian Democrats also said the same recently. Practically only real supporter is Mr. Katainen who is the most euro enthusiastic politician in Finland.

So hell will freeze over before current EU-agreement which removes unanimity from ESM goes through Finnish Parliament.

Europe's Blithering Idiots

Ambrose Evans-Pritchard has some choice (and accurate) words in a scathing attack on Europe's blithering idiots and their flim-flam treaty

As Sir Mervyn King said last week, the disaster was caused by current account imbalances (Spain's deficit, and Germany's surplus), and by capital flows setting off private sector credit booms.

The Treaty proposals evade the core issue.

Did France and Germany really have to cause this rift by throwing in an assault on the City that has precious little do with the EMU crisis? Yes, I suppose they did.

Given that Merkozy cannot bring themselves to accept that Europe's debacle stems from the euro itself, from a 30pc currency misalignment between from North and South, and from an over-leveraged €23 trillion banking bubble that German, French, Dutch, Belgian regulators allowed to happen… given that, yes, I suppose they have to find a scapegoat.

They have to whip up a witchhunt against somebody, so why not Anglo-Saxon bankers? Nasty reflexes are at work. German and French politicians in particular should be very careful about inciting populist hatred against a group that makes such easy prey. We have been there before.

The Europols have not begun to work out a viable solution to their deformed and unworkable currency union, and perhaps no such solution exists. The system will lurch from crisis to crisis until it blows up in acrimony.

Does France, for that matter, really want to be locked into a clammy embrace with an ever stronger Germany? The whole purpose of monetary union for Paris was to tie down a reunited Germany with silken cords. France now finds its own hands tied because of EMU, reduced to a humiliating side-kick.

But the vain and hysterical little man now in the Elysée will soon be gone. A leader will emerge once more with a "certaine idée de la France".

As for Britain, let us seize the moment of liberation, and enjoy it.

Escape the Euro Prison!

I cannot possibly agree more with Pritchard's statement "Seize the moment of liberation, and enjoy it." Indeed Pritchard should be grateful for the arrogance of Merkozy.

Cameron's Pledge to "Fight from Within" is entirely wrong.

In a highly entertaining video interview with Nigel Farage has exactly the right idea: Escape Euro Prison!

Unmitigated Gall and Arrogance

Imagine knowing full well that Finland cannot go along with and also knowing full well that voters stand no chance of passing it either.

Instead of working with Finland, Merkozy had the gall and arrogance to to relegate Finland to a footnote in the treaty.

So yes, this "flim-flam" treaty proposal will blow up in acrimony, probably before March, or it will be further weakened at the insistence of 1 vs. 16.

Regardless, the Euro ship is headed down, torpedoed by arrogance of two leaders whose only concern is their own political legacy. Sarkozy and Merkel can bask in the limelight of false hope for now, but both will be gone in the next elections.

History will not be kind to Merkozy, nor to Jean-Claude Trichet, nor any of the other Eurofools who think politics trumps economic reality.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
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marți, 13 decembrie 2011