miercuri, 3 aprilie 2013

Lifting A Manual Penalty Given By Google (Personal Experience)

Lifting A Manual Penalty Given By Google (Personal Experience)


Lifting A Manual Penalty Given By Google (Personal Experience)

Posted: 02 Apr 2013 02:10 PM PDT

Posted by Pinpoint Designs

On the 15th of August 2012, our agency's website (which was in the middle of a complete redesign) was hit with a manual penalty by our friends over at Google. This came completely out of the blue to us, as we're a fairly small agency that has never taken part in any unorthodox link building techniques. We offer link building services to our clients and pride ourselves on carrying out only high quality and white hat work.

I should point out at this point that our clients have never received any unnatural links warnings. Since we lifted our penalty, we've also helped many new clients get manual actions revoked and back into Google.

Unnatrual Links Detected

We straight away knew that we had been hit by Google's Panda 3.9.1 update (see comments for updated algorithm information)

After looking at a lot of experts discussing this issue on the Internet, I could see a mixed bag of suggestions on what people would recommend we do. I first of all started by sending in a reconsideration request explaining that I believed there was a mistake. As the majority of our work comes from word of mouth, we've never taken part in any SEO, but this was something we were planning on starting very shortly.

I later received a reconsideration request response that said the following:

"Dear site owner or webmaster of http://www.pinpointdesigns.co.uk/, We received a request from a site owner to reconsider http://www.pinpointdesigns.co.uk/ for compliance with Google's Webmaster Guidelines. We've reviewed your site and we still see links to your site that violate our quality guidelines. Specifically, look for possibly artificial or unnatural links pointing to your site that could be intended to manipulate PageRank. Examples of unnatural linking could include buying links to pass PageRank or participating in link schemes. We encourage you to make changes to comply with our quality guidelines. Once you've made these changes, please submit your site for reconsideration in Google's search results. If you find unnatural links to your site that you are unable to control or remove, please provide the details in your reconsideration request. If you have additional questions about how to resolve this issue, please see our Webmaster Help Forum for support.

Sincerely, Google Search Quality Team.'

In hindsight, I should have realised that this was never going to work.

I read many articles on the Internet from top SEO experts and looked through the SEOMoz guides on how to clear up link penalties, but the general opinion was that if you had been hit by a manual penalty, that there was a very slim chance of having this reversed.

I then decided to look at our backlinks using OSE (Open Site Explorer). By doing this, we were able to see a list of all of the anchor text variants and types of links coming back to our website. It became clear fairly quickly why we had been hit.

Silly mistakes

When developing websites for clients, we always include links in the bottom right footer of the client's website. Usually, this is something along the lines of "Web Design Yorkshire | Pinpoint Designs". These two blocks of text include links to the homepage of our agency's website. When looking at the webmaster guidelines, it's pretty obvious that we should never have been doing this, and most likely the cause of our penalty.

At this time, we had around 65 domains pointing at our site, with over 1500 links showing anchor text that was similar to "Web Design Yorkshire", "Website Design In Yorkshire" and so on.

Luckily, we manage the majority of our clients' websites, so it has been very easy for us to remove these. We updated the footer of each website to remove the anchor text "Web Design Yorkshire" and saved the changes. We also created a Google Docs file that included the URL of each website along with the changes we had made so that we could include this in our next reconsideration request. 

The second reconsideration request we sent had a lot more time spent on it. Instead of telling Google what they had done wrong, we wrote a long request that had the following structure:

  • Who we were and what we do
  • Why we believed we had been hit
  • What we had done to rectify the issue (a link to the Google Docs file was attached)
  • How we knew it wouldn't happen again
  • An apology
  • My name / contact details

Note: If you are sending in a request because an SEO company has managed to get you banned, it's wise to let Google know the company's name and the work they've carried out. Any information you want to provide them should be added in a Google Docs document and a link attached.

At this point, we had just launched our brand new website, so I explained to Google that we had just relaunched and that we were pushing quality content out to all of our users.

The second reconsideration request came back unsuccessful, and my hopes started to fade as to how we were going to get back into the search engines. I then decided that I would contact SEOMoz via a private question to ask for further clarification and any more tips they could provide. I received a response from Carson Ward, an SEO Consultant from Distilled, who helped by providing a little more information.

Carson said that footer links were indeed the problem. There were a ton of links that said "web design yorkshire" and similar, and this triggered the Penguin penalty. He recommended using more branded and varied anchor text, avoiding site-wide links, and, as a last resort, either removing or nofollowing footer links on sites we had designed.

To minimize your risk, you can do a few things:
  • Use branded anchor text the majority of the time. It looks a lot more natural to link back using your brand name. The safest example would be "Web design by Pinpoint Designs". The slightly riskier "Web design by Pinpoint Designs" can be a bit more beneficial.
  • Mix up the anchor text - use different variations so that no single anchor is overwhelmingly common.
  • Avoid site-wide links, especially with exact-match non-branded anchor text.

Now that you've already been flagged, you could try doing the above and seeing if that's good enough for Google. You could also just nofollow or remove the links. These footer links are already devalued, but you'll lose a little bit of ranking power by nofollowing/removing them.

He also indicated in a second email that Google has sometimes been stubborn on reinclusion requests, and that it might be necessary to jump through some hoops to get back in their good graces.

It became clear that I would have to up my game If I wanted to ease Google's fears of us spamming them, so I got to work in trying to clear everything up properly. I decided to spend a month getting my head down and working on removing everything. Before setting all the links to no follow, I wanted to give it once more chance.

We wanted to avoid the Disavow tool at all costs, as the links pointing to our website were not bad quality.

What worked

We logged into Google Webmaster Tools and looked at the links pointing to our site, we then went through each of these sites to make sure that any anchor text pointing to us was only brand based keywords. It occurred to me that during this point, the only links we really had were from clients websites, so Google wouldn't really see us as a website worth promoting.

I then started writing articles for our website's blog - these revolved around social media, SEO and website launches for our clients. I wanted to build quality content on our website and had a positive attitude of trying to write engaging articles. We decided not to write articles every day, but longer length articles that were posted out once per week or so.

Once this has been sorted, we started pushing our Twitter page. We followed local design agencies and people that we personally found interesting. We always try to engage with people and tweet about articles that we believe are interesting. We even wrote an article on our blog about social engagement and tried to provide useful information to people where possible. It was obvious this was working, as our Twitter account started growing very quickly and we were getting favourites, retweets and replies to our posts!

Finally, we decided that we should start doing some actual SEO work on our website in the same way we do for our clients. We're a big fan of guest blogging on sites that are related to your industry, so we started out by writing articles about subjects we are interested in. This includes email marketing, social media, SEO, user interface design and so on. We then used some great web tools to find guest post opportunities and got in touch with the blog owners.

An important point here is that we only linked back to our website using variations of our brand name. This was either 'Pinpoint Designs', 'Pin point designs' or our domain name. We wrote around 15-20 very high quality blog posts and submitted them to different guest blogs varying from PR2 - PR6 domains. We only posted to higher quality blogs, and made sure that they were reputable (as some blog owners only want your articles to boost their ranks for affiliate purposes).

All sites were checked out by domain authority, PageRank and a visual check to make sure they didn't look 'spammy'. We also made sure that the niche fitted our website as best as possible.

Useful websites

Citation Labs - Garrett's tools are fantastic. I really cannot express how easy It is to find quality blogs. We used the Link Prospector tool in order to find high quality blogs that were related to our industry.

Blogger LinkUp Again, this website is amazing for a site that is free of charge. Enter in your email address and once a day (or once every couple of days) you will receive an email with guest post opportunities. You can then email the authors of the sites to write guest posts for them.

We then went for reconsideration request number three. I put together a fairly short reconsideration request that was based around our previous request. I explained that we had worked on building quality content up across the Internet and that we were interacting with people on social media. I explained that we realised that we'd made silly mistakes and also included a link to our previous work. By this point, a lot of our links had updated in Webmaster Tools and the percentage of non-branded anchor text to branded anchor text had decreased which was positive.

Only three days later, we received the following email:

Google Manual Spam Action Revoked

Summary

Starting out as a fairly small company, our website wasn't the site we wanted it to be. In 2012, we decided that we would revamp our website and start promoting ourselves across the UK. We've been growing quickly year on year, but we very rarely acquire work via our website. Just as this had happened, we received a penalty from Google.

After working with some companies who have received penalties from doing blackhat work, I would recommend the following tactics:

  1. Start by building up a list of all the links pointing to your website - This is extremely easy. Login to Open Site Explorer, Google Webmaster Tools and use other websites such as Ahrefs or Majestic SEO. Pull together a list of URLs and Anchor text pointing to your website and try to make sure that you always have more branded anchor text than non-branded. In the Google Panda updates, it should become apparent fairly quickly why you've been struck with a penalty.
     
  2. Work to remove those links hard! - Removing links isn't easy, there are numerous sites out there that will help remove links from you, but it's a fairly slow process. One of our clients had been using SENuke to build links to forums. We wrote a small script that logged into all of these forums using the username and passwords which luckily they had, and updated the info box to remove the links to their site. Unfortunately, if you don't have the luxury of having the passwords to hand, you'll have to contact the owners one by one.
     
  3. If you can't remove links - If you can't remove links, use the Google Disavow tool. That being said, don't use it unless absolutely necessary. If you're having to use the disavow tool on thousands of links, then you're in trouble!
     
  4. Write good quality content - Show Google that you can write good content! Make sure that all the content on your website is unique, up to date and interesting. Spend some time working out anything you are not happy with and show them that you are an authority site that they should promote. Get involved with the community, grow your social media accounts organically and tidy up your image.
     
  5. Spend time on your reconsideration request - Google must receive hundreds, if not thousands, of reconsideration requests each and every week. Rather than sending in a paragraph, spend some time telling them what you've done wrong and most importantly, be honest. Tell them why you think you've been targeted, what you've done to rectify it and how it won't happen again. Apologise for the mistake(s) and hold your hands up if you're in the wrong. Add in information from Google Docs to show what links you've cleared off and let them know why you're worth it!
     
  6. Don't get involved in the first place! - This is always easy to say in hindsight, but don't get yourself into the position where you need to clean up your websites rankings in the first place. We were initially targeted because of a bad choice of anchor text. Once we were targeted, we had to make sure we were squeaky clean before having the penalty revoked. Only stick to ethical link building practices and stay on Google's good side!

Sign up for The Moz Top 10, a semimonthly mailer updating you on the top ten hottest pieces of SEO news, tips, and rad links uncovered by the Moz team. Think of it as your exclusive digest of stuff you don't have time to hunt down but want to read!

Photo of the Day: Remembering American Legend Jackie Robinson

The White House Your Daily Snapshot for
Wednesday, April 3, 2013
 

Watch President Obama's remarks on common-sense measures to reduce gun violence at 5:00 p.m. EDT on WhiteHouse.gov/Live.

Photo of the Day: Remembering American Legend Jackie Robinson

President Barack Obama talks with Rachel Robinson before the “42” movie screening with Robinson family members and cast and crew in the Family Theater at the White House, April 2, 2013. (Official White House Photo by Pete Souza)

President Barack Obama talks with Rachel Robinson before the “42” movie screening with Robinson family members and cast and crew in the Family Theater at the White House, April 2, 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:

BRAIN Initiative Challenges Researchers to Unlock Mysteries of Human Mind
President Obama unveils the “BRAIN” Initiative—a bold new research effort to revolutionize our understanding of the human mind and uncover new ways to treat, prevent, and cure brain disorders like Alzheimer’s, schizophrenia, autism, epilepsy, and traumatic brain injury.

President Obama Meets with Prime Minister Lee of Singapore
In a bilateral meeting with Prime Minister Lee Hsien Loong of Singapore, President Obama reaffirms his commitment to a secure and prosperous Asia-Pacific region.

Helping Americans on the Autism Spectrum Reach Their Full Potential
President Obama is committed to research, development of support services, and increased collaboration with advocates and family members in the autism community so that individuals across the autism spectrum can reach their full potential.

Today's Schedule

All times are Eastern Daylight Time (EDT).

11:00 AM: The President receives the Presidential Daily Briefing

11:55 AM: The President departs the White House en route Joint Base Andrews

12:10 PM: The President departs Joint Base Andrews en route Denver, Colorado

3:40 PM: The President arrives Denver, Colorado

4:10 PM: The President meets with local law enforcement officials and community leaders

5:00 PM: The President delivers remarks on common-sense measures to reduce gun violence WhiteHouse.gov/live

6:05 PM: The President departs Denver, Colorado en route San Francisco, California

8:25 PM: The President arrives San Francisco, California

9:15 PM: The President delivers remarks at a DCCC event

10:55 PM: The President delivers remarks at a DCCC event

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

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Seth's Blog : A field guide to the Meeting Troll

 

A field guide to the Meeting Troll

The meeting troll is a common creature, one that morphs over time and is good at hiding (snaring you when it's too late to avoid him.)

  1. The meeting troll has a neverending list of reasonable objections. It's the length of the list that makes the objections unreasonable.
  2. The meeting troll never says 'we'. It's all about 'you.'
  3. The meeting troll doesn't actually want you to fail, but is establishing a trail so that if you do, he's off the hook.
  4. Despite his protestations about how much he hates meetings, the meeting troll actually thrives on them, because, after all, this is the only place he gets to do his best work. The very best way to extinguish the meeting troll is to extinguish meetings. The second best way is to not invite him.
  5. A key giveway: The meeting troll will use the phrase, "devil's advocate." More than once.
  6. Growth hackers look for a yes at every turn. The meeting troll thinks his job is to find the no.
  7. The meeting troll never eagerly calls a project meeting, nor does he bring refreshments, volunteer to organize follow up or encourage others to push their ideas even further. He's eager, though, to host the post mortem.
  8. One particularly noxious type of meeting troll says not a thing at the meeting. He uses body language and eye rolling to great advantage, though, and you can be sure that there will be quiet one-on-one undermining going on as soon as the meeting is over. The modern evolution of this is the instant messaging of snide remarks during the meeting.
  9. The meeting troll has a perfect memory for previous failures and complete amnesia when it comes to things that have worked.
  10. Analogies, particularly to vivid flameouts (regardless of how rare or irrelevant) is the easy tool for the amateur troll. He's also good at equating your desire to deal with negative change with the assertion that you somehow caused or were in favor of that negative change.
  11. Open-ended questions that merely hint at failure are sufficient for the experienced troll. He knows that he doesn't have to kill the new project for it to die. He just has to stir up sufficient unease.
  12. The meeting troll is afraid, not merely evil. Change is a threat, and trolling is his well-intentioned but erroneous response to the threat of change.

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marți, 2 aprilie 2013

Mish's Global Economic Trend Analysis

Mish's Global Economic Trend Analysis


Do You Believe China's GDP Numbers?

Posted: 02 Apr 2013 10:19 PM PDT

Do you believe growth figures in China? What about the US, Canada, or Germany?

Actually, there is no reason to believe any GDP numbers. A recent email from Michael Pettis at China Financial Markets explains.

From Pettis ....
Last year China's official growth rate was 7.8%, above the 7.5% target but the lowest number in many years and far lower than the more than 10% growth rates China had generated for the past two decades.

But even with the lower growth numbers throughout the year economists were puzzled by evidence that the economy was in fact growing more slowly than the official numbers suggested. Energy consumption in China, for example, usually grows more quickly than GDP, but surprisingly, in 2012 energy usage grew by only 5.5%, well below the official growth rate of 7.8%. Other indicators also indicated that growth may have been lower than the official numbers suggested.

While some of the sell-side economists still insist that China's growth remained high and healthy enough, in fact among independent economists who specialize in the Chinese economy, both among Chinese and foreign economists there has been growing skepticism. A consensus is developing that China grew by less that 7.8% in 2012. For example Stephen Green at Standard Chartered, one of my favorites of the sell-side economists, refigured his numbers and guesses that instead of 9.3% for 2011 and 7.8% for 2012 (the official numbers), actual growth might have been 7.2% for 2011 and 5.5% for 2012. Other economists are suggesting even lower numbers, closer to zero.

I don't have my own estimates because it seems to me that all of these attempts to measure economic growth are actually measuring economic activity, which may itself overstate growth. If you spend $100 million each on two separate bridges, one of which is actively used and the other rarely used, the official measures will have them contributing the same amount to GDP, even though the former creates real value and the latter does not. In either case if you then adjust the overall GDP numbers downwards by examining electricity usage, cement consumption, and so on, as the likes of Stephen Green do, you may end up with a more accurate estimate of economic activity, but you still treat the two bridges as contributing the same amount.

It isn't until you write down the debt associated with the second bridge that you end up with a more meaningful measure of GDP. Of course this makes the whole process very confusing and it is hard to compare different estimates. It isn't always clear how these estimates are reached, but as far as I can tell nearly all, if not all, of the downward revisions provided by various skeptical economists are still measures of economic activity, and do not include estimates for debt write-down associated with unnecessary investment.

We Know What To Do

There have been so many articles in the Chinese and foreign press about problems in the banking system that I won't bother going through the topic much more except to note that Beijing cannot tolerate rapid credit growth and it cannot tolerate slow GDP growth. The problem is that it can only choose both or neither. There are no other options.

As credit concerns continue to rise, expect Beijing eventually to bite the bullet and stamp down on debt, in which case expect GDP growth rates to drop much, much more, in fact to well below anything we saw in 2012. The question is not whether this will happen, but when. Once Beijing is confident enough about its grip over vested interests and the consensus has developed within the leadership, growth rates will drop very sharply.

So this is probably why former Premier Wen is warning about the difficulty China faces in reforming the economy – a warning that he and Premier Li have made many times before but never more shrilly.

I have said often enough that we will be able to judge how resolute Beijing is and how capable of overcoming vested interests by how quickly credit growth is constrained and, with it, GPD growth. I expect to see high GDP growth (close to 8%) in the first half of the year but, if Beijing is able to move quickly, I expect growth to slow significantly in the second half.

If GDP growth does not slow, I will be worried about how long it takes the new leadership to get their arms around the problem that they clearly recognize (although perhaps still underestimate). The signals so far are good. Growth may be slowing even quicker than I had originally anticipated.

Does Cyprus matter?

I can't really finish this newsletter without noting the astonishing events in Cyprus, especially since everyone in the world has already mentioned them. The concern most commentators have expressed is that by going after depositors the EU may have paved the way for bank runs in the rest of peripheral Europe. Quite a few analysts warned that we will begin to see this happen fairly soon.

I agree, but see it a little differently. The Cyprus proposal will probably have little impact on deposits now, but it will have an impact on memory. Depositors in the peripheral countries will remember what happened in Cyprus and it will affect their future confidence in the credibility of deposit guarantees.

We can imagine the "Cyprus effect" as a point on the credibility curve at which there is a sudden discontinuous or non-linear jump. As a country's credibility declines, the deterioration in credibility was never likely to be smooth and linear because the process is self-reinforcing, but now we have added a sharp discontinuity. At some point of lower credibility, depositors, remembering Cyprus, will suddenly and sharply speed up their deposit withdrawal. And even if the original Cyprus plan is modified to protect small depositors, it probably won't matter. The cat has already been let out of the bag.

Instead of embedding countercyclical mechanisms we have just embedded a big, fat, highly pro-cyclical pump into the credibility curve. It won't matter so much now, but as things deteriorate, it will matter at some point, and of course always at the worst possible time.
Problem In The Definition

I italicized the key point. By definition, government spending contributes to GDP. No products have to be produced. Economic benefits are unnecessary.

Pettis used an example of governments building worthless bridges. Previously I have noted that if the government hired people to spit at the moon it would add to GDP. And that is an inherent problem with the definition.

In France, government spending accounts to 56% of GDP. How much of that spending is wasteful? How much government spending in the US is wasted?

Consider how Davis-Bacon and prevailing wage laws affect the answer. In the case of roads repairs, if the private market could do as good a repair job for 1/3 less, then the answer is 33.3%. But what about projects that should not be done at all?

Spending can even be net-negative as is the case in bombing countries for no reason. What did the US accomplish in Vietnam or Iraq? Even bridges to nowhere have more economic benefit.

While everyone is ready and willing to consider that China overstates its GDP, too few point the same finger at the US for the same reason.

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

Sharp Deterioration in French Manufacturing; Hollande Orders Employers to Pay 75% Tax; Top Executives Join France Exodus

Posted: 02 Apr 2013 10:50 AM PDT

As expected, economic news in France continues to worsen. The Markit France Manufacturing PMI shows final data French manufacturing sector operating conditions continue to deteriorate at a marked pace.
Key points:

PMI remains indicative of sharp downturn despite rising to three-month high
Output, new orders and employment fall further
Prices charged cut at fastest rate since November 2009

Summary:

Operating conditions in the French manufacturing sector continued to worsen in March. Although the headline Purchasing Managers' Index ® inched up to a three-month high of 44.0, from 43.9 in February, it continued to signal a marked rate of deterioration.

The level of incoming new orders placed with manufacturers in France decreased further during March, extending the current period of contraction to 21 months. Moreover, the pace of decline accelerated slightly since February.

Reduced workloads prompted French manufacturers to cut staffing levels further in March. The rate of job shedding was solid, albeit the slowest in three months.

Prices charged by French manufacturers for finished goods fell for the third month running during March. Furthermore, the rate of decline accelerated to the sharpest since November 2009. A number of survey respondents commented that strong competitive pressures had weighed on their pricing power.

Comment:

Jack Kennedy, Senior Economist at Markit said: "A very slight improvement in the headline PMI figure does little to disguise an ongoing sharp deterioration in French manufacturing sector operating conditions during March. Increasingly aggressive output price discounting failed to prevent new orders dropping steeply remained deficient. Further marked falls in employment, purchasing and stocks also bear witness to a beleaguered industry struggling in the face of a darkening economic climate in France."
Manufacturing vs. Production



click on chart for sharper image

The manufacturing PMI leads production and by implication GDP.

So guess where French GDP and the French budget deficit is headed. A trio of articles from the Financial Times will fill in a few of the expected pieces.

France Misses 2012 Deficit Target

As expected in this corner France Misses 2012 Deficit Target and it will miss its 2013 target as well.
Official figures showed the nominal deficit last year was 4.8 per cent of gross domestic product, overshooting the government's target of 4.5 per cent. The 2011 deficit was also revised slightly upwards to 5.3 per cent.

The government has already acknowledged it will overshoot this year's target deficit of 3 per cent previously agreed with the European Commission. With the figure now forecast to hit 3.7 per cent, France is seeking a year's delay from the commission for reaching the target, the level at which growth in the public debt should stabilise.

The figures from Insee, the national statistics agency, showed the public debt, including France's commitments to the eurozone's rescue funds, rose to a record 90.2 per cent of GDP in 2012, slightly higher than target and up from 85.8 per cent in 2011.

France has not had a balanced budget since 1974 and is under strong pressure to cut its big public spending bill, which amounts to more than 56 per cent of GDP, the second largest in the EU.
French Unemployment Hits 16-Year High

Also as expected in this corner French Unemployment Hits 16-Year High
French unemployment nudged a record level in February as the jobless total rose for the 22nd month in succession to a 16-year high, adding to the acute political pressure on President François Hollande as he battles a stalled economy.

The number of people out of work actively seeking employment rose by 18,400 over the month to 3.18m, just shy of the record level of 3.19m reached in 1997, labour ministry figures showed.
Hollande Orders Employers to Pay 75% Tax

In the not expected but hardly surprising category, Hollande Orders Employers to Pay 75% Tax

In March, the French constitutional court disallowed Hollande's controversial top tax rate of 75% on individuals.

Proving that you cannot keep a dedicated socialist down, Hollande switched responsibility for paying the tax to employers. It was after all a "campaign promise". Why is it that idiotic pledges are the ones most likely to be met?

Supposedly the tax hike will last only two years.

Is it any wonder Top executives flee France for London, Belgium, and Switzerland?

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

Spain's Deficit Set to Soar; GDP Poised to Plunge; Job Losses Fastest in 3 Years; IIF Wants Permanent Tax Hikes

Posted: 02 Apr 2013 01:13 AM PDT

The situation in Spain took another sharp turn for the worse. Employment losses are the greatest since 2009, tax revenue is declining, the deficit is increasing and the IIF wants economically insane tax hikes.

GDP Poised to Plunge, Deficit Poised to Rise

El Economista reports IIF believes that the Spanish economy will contract by 2% in 2013.
The Institute of International Finance (IIF) believes the Spanish economy contraction will accelerate to register a gross domestic product (GDP) decline of 2%.

"The decline in GDP seems likely to accelerate to 2% in 2013 after 1.4% in 2012, as high unemployment, tight monetary conditions and current lower wages further reduce domestic spending and weak demand contain domestic exports," said the IIF in a report on the eurozone.

The agency believes that this growth outlook "much weaker" have made ​​the agreed deficit targets for 2013 and 2014 are "unreachable", and believes that this year will close above 6%.

The IIF notes that the 2013 Budget predicted that the deficit falls to 4.5% of GDP this year down and 3% in 2014. "However, these growth forecasts for this year especially, seem unlikely," the report says.

In the current context, tax revenues will be lower than expected and that social spending will increase as a result of high unemployment. This will bring the deficit back above 6% of GDP, even if the government implements all the measures it has promised.

It warns the expiration of temporary tax increases such as income tax hikes approved by the Government in 2012, will cause the deficit to rise again in 2014 to 6.7%.

To ensure greater deficit reduction in 2014, the government needs to extend temporary tax increases more than expected or identify other measures to compensate their withdrawal.
Decline in Manufacturing Accelerates

The Markit Spain Manufacturing PMI shows Decline in manufacturing production accelerates in March.
Key Points:

Faster falls in output and new orders
Sharpest decline in employment since December 2009
Input costs decrease for first time in eight months

Summary:

March saw an accelerated deterioration in business conditions in the Spanish manufacturing sector,
with output, new orders and employment all falling at faster rates than in February. This contrasted
with business conditions coming closer to stabilisation earlier in 2013.

The seasonally adjusted Markit Purchasing Managers' Index dropped to 44.2 in March, from 46.8 in the previous month. This was the lowest reading since October 2012, and represented the twenty-third successive deterioration of business conditions in the sector.

New orders fell at a steeper pace in March, with the latest decline the fastest since November 2012.
New export orders also decreased, ending a three-month period of growth. The rate of job cuts also
quickened, and was the steepest since December 2009.

Comment:

Commenting on the Spanish Manufacturing PMI ® survey data, Andrew Harker, economist at Markit and author of the report, said: "The March PMI data for Spain make grim reading for the manufacturing sector. Moreover, the latest figures have brought an end to the recent period of moderating declines, and cast doubt on any hopes of recovery for the rest of the year. The employment index again highlighted the extent of the problems currently afflicting the manufacturing sector and the wider Spanish economy, with jobs cut at the fastest pace in more than three years."
The IIF wants Spain to hike taxes (extend temporary hikes if you prefer). Either way, the IIF is totally nuts. How long is Spain going to put up with this?

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