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luni, 20 mai 2013
A Generation Uniquely Poised for Success
SMX London 2013 – Top Takeaways from the Paid Search and SMX Advanced Tracks
SMX London 2013 – Top Takeaways from the Paid Search and SMX Advanced Tracks |  |
| SMX London 2013 – Top Takeaways from the Paid Search and SMX Advanced Tracks Posted: 17 May 2013 03:13 AM PDT We’ve had a great couple of days at SMX London – here’s what we learnt from the Paid Search track from day 1 and the SMX Advanced track from day 2! Day 1 – Paid Search TrackAmazing Paid Search Tactics & ToolsAnn Stanley, Co-Founder and MD of Anicca Digital (@annstanley)Ecommerce advertising has changed quite a bit recently: Google Shopping transitioned from free to paid last month in the UK, and Google have just announced that they’re getting rid of product extensions. That means having product listing ads is more important for ecommerce. Having a PLA ad group set for ‘all products’ with a really low bid has got them good results – it can be a good way to turn up in searches no one else is appearing on. There doesn’t seem to be a true quality score for PLAs, but CTR is a factor to whether they get seen or not. Improve CTR with negative keywords. Also check your feed – you may be using low quality information.
If eBay and Amazon are competing then CPC for a product listing ads can be higher than for a regular ad. You may have to take a hit on costs to appear at first, but you may be able to claw back CPC as you build performance history. PLAs don't always improve your CTR – you've got to test them. It's rare that they don’t add advantage, but the cost could be prohibitive. If you have multiple prices, for example from multipacks or excluding VAT, AdWords may pick the wrong price to show. You may have to manually manipulate the price in your feed. Use tracking URLs to track PLA performance in Analytics. Enhanced campaigns mean we can't have separate tablet bids or keyword level mobile bids – but people might use conversion optimiser (CPA bidding) to get around this. Magnus Nilsson, Managing Director of RED Performance (@nilsson_magnus)You can automate structures, bid management, optimisation and reporting using AdWords Scripts. AdWords Scripts are JavaScript based, so it's easy to get started. You can learn JavaScript from Codeacademy. There is Google Docs integration. That means you can push data into spreadsheets to make automated reports or charts. You can also pull in information from a Google Doc – and Google Docs can pull in information themselves that you can then use. He used Scripts to put a countdown in ads, which updated hourly. The increase in CTR and QS meant he doubled the number of clicks he got for his budget. He also used a script for a dating site, so that different ad text showed according to the weather – the day's weather forecast was pulled into Google Docs from Wunderground. Matt Van Wagner, President of Find Me Faster (@mvanwagner)The Display Network is sort of like a newsstand. You can find anything, but you want to be in the right area, section & page. Once you've found the perfect placement, own the page with both text and image ads. Make image ads to complement the placement's colour scheme, and use appropriate language. Use keyword targeting as a 'seed campaign' to find good placements and to get on one-off pages. When targeting with keywords, have tightly themed ad groups. Be specific with 2 or 3 word terms, as you only have broad match available. Once you’ve found the perfect page, you can throw the Google Keyword Tool at that page and target those keywords too. Don’t use more than 50 negative keywords, or Google won’t pay attention to all of them. ‘Fine tune the hell’ out of managed placements. Specify a site and then use keywords to turn up on certain subjects. Don't use topics as a standalone targeting technique. They are useful as negatives and for picking out sections of large placements. Keep graphical ads in separate ad groups to text ads Use AdGooroo for competitor research on the Display Network Use MixRank to find competitor image ads and placements Play ‘king of the hill’ – create a campaign targeting competitor placements, with high bids to push their ads out, for 3 days. Then you will have performance data so you can tell which placements work for you, and they probably won't be able to tell what happened because of the short timeframe. Conversion ScienceGeorge Popstefanov, Founder and Chief Idea Officer of Performance Media Group (@GeorgePMG)Don’t remove content from your mobile site, but don’t keep masses of text or huge pictures that won’t work well on mobile devices. Tailor your content to mobile. Page speed matters: he's seen a 22% improvement in conversion rate by moving to better servers and getting faster load speeds. Look at what content your mobile visitors use, compared to desktop users. “I promise it is different” There are attributes like creative, offer, placement and time of day which could be the driving force of an ad's success: see which is correlated with revenue. Use remarketing list for search ads for people from non-paid traffic. Group people by traffic source, so for example you can use a landing page with Pinterest style images for someone who previously came to your site from Pinterest Manny Rivas, Online Marketing Account Manager from aimClear (@mannyrivas)Not all targeting is created equal, and not all sources are going to convert equally well. You want to draw qualified customers into a sales funnel, and if they leave then bring them back in at the right stage. Create content to position yourself as thought leader, to create a good first impression. Use psychographic targeting: figure out your customers' personas and target them, then see how they perform against different pages. To find psychographic information use display advertising with age targeting, and see how the different age groups use your site. Don’t forget the fundamental tenets of sales – create rapport, be likeable, be an expert, actively listen, understand their motivation. “The best conversion optimisation is a product that doesn’t suck” Q&AThere was some debate about enhanced campaigns. George says you should upgrade a few campaigns to get used to the new features and interface – don’t try to tackle it all at once. Conversely Matt says that Google is still "making it up" – since the initial announcement they've added ad group level mobile bids and moved the deadline. He says you should put off enhancing for as long as possible in case it changes again. Ann Stanley agreed, saying that as Google made a U-turn on ad rotation settings they may still allow separate mobile campaigns. If they do, any time spent now merging mobile and desktop campaigns would be wasted. Manny is worried about rolling tablet and desktop together as he’s seen widely different conversion rates – they may be trending together but they’re not the same at the moment. Creating, Testing and Optimising AdsSean Malseed, Director of Strategic Development at SEMrush (@seanmalseed)Where should you start? A lot of people say you should just jump in. But you can avoid trial and error if you find what your competitors are doing, avoid their mistakes and build from their successes. Use SimilarSites – it's actually a recommendation engine but you can use it to find your real competitors. If several competitors bid on a keyword, then they’re probably on to something. If there's an obvious keyword for you think it looks good, but none of your competitors are bidding on it, then there’s a reason. Do all of your research with exact match – close but different searches convert differently, and Google Keyword Tool is a salesman. You need to accurately compare keywords without overlap. Use Merge Words to merge your list of keywords with your locations for local terms. Use Keyword Eye to find the easiest keywords to grab from your competitors Use Keyword Tool Dominator for more long tail keyword research. Rebecca Hansson, Senior Search Strategist and CEO at SESNordic (@sesnordic)When creating ads you should understand your audience and know your benefits. Meet your visitors' expectations – the landing page must match the ad. Never stop testing until you have a CTR of 100%, a conversion rate of 100% and an infinite ROI. Things to try testing:
Use the 'rotate indefinitely' setting, not 'optimise for clicks'. Don't test many things at once, or you won't know which part of the ad worked. Don't just look at CTR. Look at Analytics and your conversion data to choose the best converting ad. Rebecca Momberg from Marin SoftwareInstead of thinking of ad as headlines, description lines and display URLs, think of the emotional and functional components. For example ‘summer’ conjures images in head which influences the searcher – it's an emotional component. Information like offers and pricing are functional. Look at tokens rather than keywords. For example ‘mens hiking backpacks’ is 3 tokens. See which tokens are the most popular in your SQRs and use them in creative testing. Don't just test ads with dynamic keyword insertion against ads without – also test changes to the static part of the DKI. Q&AUse a test tool to check your test is statistically significant. Testing ads can temporarily affect quality score as the ad lacks history – don't stop your tests too quickly, give it some time for the QS to go back to the normal level. The minimum time for testing is a week, but this is not recommended. Forget What You Know About AdWords & Paid SearchGeorge Popstefanov, Founder and Chief Idea Officer of Performance Media Group (@GeorgePMG)Have a Google+ page with over 100 followers and regular posts, so you can get on the Knowledge graph and dominate searchers for your brand. Enhanced campaigns require a mind shift – how do we keep track of bid multipliers? The new sitelinks can be scheduled, which is good for promotions. Not everything is changing when campaigns are enhanced. The overall structure of an account will not change; keyword match types remain the same; Google Search, Search and Search Partners and GDN will still be separable. In legacy campaigns opted into multiple devices, Google currently discounts mobile bids. This will not be the case for enhanced campaigns. When everyone is on enhanced, it's likely many less experienced advertisers will neglect to add mobile bid adjustments and just use their full desktop bid – this means mobile CPC will probably rise. Ad group level sitelinks are worth the hassle of setting up, but we think AdWords Editor should be able to cope with them at the end of July which will make them easier. Day 2 – SMX Advanced TrackPrioritising Your Search Marketing EffortsMikkel deMib Svendsen, Creative Director of deMib.com (@demib)3 easy steps to prioritise your SEO: 1. List all the things you may have to deal with – look at the SEO periodic table for inspiration. 2. Analyse your site and market, rate each issue as green (not a problem), red (serious problems), yellow (things that could be improved). Red and green issues are easy – you can ignore the green and must fix the red. The complicated thing is the yellow 3. Rate all the yellow on a 5 point scale by impact on results, time to complete, impact on resources. You know you need to do the red issues first and can ignore the green – you just need to sort out the yellow 'nice to haves'. If you rate by each factor then can order the tasks by what matters: for example if you don’t have much resource order tasks by how much resource they need. Julia Logan, CMO of ContentMango (@irishwonder)In May 2012 (after the Penguin update) Google stopped saying “there’s almost nothing a competitor can do to harm your rankings” and started saying “Google works hard to prevent other webmasters from being able to harm your ranking” – so they are admitting negative SEO is possible. SEO security audits should cover more than links: site architecture can cause problems too by making negative SEO against your site easier. If you have indexable search results you could be indexed for any sketchy term with a page like yoursite.com/search/buy+Viagra. To stop this on WordPress sites, add to robots.txt Insecure plugins mean people could add links to your site Being infected by malware can disrupt traffic, as people trying to visit your site will see malware warnings – here are instructions of how to fix this. Site architecture can cause duplicate content, for example by having archived pages. Check WhoRush to see who is hosted on the same IP as you – you don't want to be in a bad neighbourhood. Do link audits before you get any emails from Google. A weak link profile makes negative SEO easier. Use LinkRisk. Watch your links to see if they suddenly disappear – as so many link removal requests are flying around, someone could request your links to be removed without you knowing. Be suspicious if you suddenly get more links, spammier links or unusual anchor text. You can check what terms you get traffic for as well as crawling for links. Dave Davies, CEO of Beanstalk Search Engine Optimization, Inc. (@beanstalkseo)Strategise: don’t just think of what you want now but also what you want in the future. Think about where you want to be in 3 months. Before you get started you will need keyword research, find major influencers and competitors in your field. Outline your milestones, like launches and press release worthy things, so you can plan around them in advance. Test keywords with paid search before putting resources into ranking for them organically – then you will know if those keywords' traffic actually converts. Have your SEO focus on onsite improvements while this testing happens. Andy Atkins-Kruger, Group CEO of WebCertain (@andyatkinskruge)Log investment by activity, then link this to Google Analytics data to see if it’s successful. But allow for production time and Google crawl delays. Rate whether tasks will have high or low impact on your goals, and how much effort they will take. Prioritise tasks that are high impact and low effort, then those that are high impact and high effort. Remember some tasks need to be done in the correct sequence: for example you may need a new CMS before you can rewrite page titles. Use the 'brussel sprout' method – pick the task you want to do least, and do it first to get it out of the way. Q&AJulia warned that if you think a plugins fixes all the issues, it probably doesn’t. Beware of malicious plugins pretending to be popular plugins – check the number of downloads. Mikkel said people will make plugins that start out clean, so they can get in the directory and get downloads, but then they add dodgy stuff like backlink functions as an update. Crawl your site for links you didn’t put there. Close your dev server from indexing, but make sure your site is indexable when it's put live. Paid Search Advertising in a Multi-Device WorldManny Rivas, Account Manager at aimClear (@mannyrivas)Make a timeline for upgrading – give campaigns difficulty levels based on thier budget, volume and settings. Don't start a new campaign structure at the same time as upgrading to enhanced campaigns – you won't be able to tell which caused changes in performance. Use a script to keep track of account level quality score. “I’ve never seen the upgrade of an account go completely right” so keep an eye on things after upgrading. Remember that bid modifiers stack – you could get 8 times your original bid if you have 3 adjustments of 100%. Alistair Dent, Head of PPC at Periscopix (@periscopix)People don’t care what device they use. Their context, not their device, is key – who are they, what are they doing, where are they. Is the person ‘in’ or ‘out’? To let us get to this context Google have given us bid multipliers. While Google continue to give examples for pizzerias, you can still apply the idea to B2B. If you want to target office workers then the keyword is starting point, the time of day suggests whether they are at work or home, and being on a mobile suggests that they might be commuting. But be aware some people may work late, or be at work while on their mobile. Alistair predicts that more features will become multipliers. For example remarketing lists for search could become a multiplier, so you can bid down or up if someone has previously visited your site. Jason Spievak, CEO of RingRevenue, Inc (@spievak)5% of the US works in a call centre – that's twice the number of people who work in food production. Search is driving tens of billions of calls, and it's growing. Calls have a 30-50% conversion rate, compared to a 1-3% conversion rate from clicks. They also have a larger average order value. This means companies are willing to pay for high-quality inbound calls. Use call tracking to find out what keyword drove a call, to keep track of lead quality and to get true ROI. Bill Dinan, President of Telmetrics (@Telmetrics)PC search is not the same as mobile search: mobile is an ‘act’ platform. Use action metrics rather than just traffic. Be upfront with your contact info in your mobile ads – smartphones are used to find & contact businesses. Advanced Keyword Research & Competitive Analysis TacticsKayden Kelly, CEO, Founder, Blast Analytics & Marketing (@kaydenkelly)Understand what people need and want so you can identify what content to create. Map keywords and content to the customer lifecycle. Don't just focus on the last stage where the customer makes their decision: know what success looks like across all stages. Split keywords into tiered silos (the top tier being head terms and the lower tiers being more long tail). Then look at the top keywords for each silo, see how your site is doing for them and if you have pages that cover them. When looking at keywords' performance in Analytics, use landing page as a secondary dimension – poor performance may be because of a problem with the page rather than because the keyword is bad. Use Tableau to visualise data for easier analysis. When looking at the Adwords Keyword Tool, don’t exclude keywords because of high CPC or high competition. These are likely to be keywords near the end of the customer lifecycle. Check the local search trends – some terms may have a low average search volume but have high volumes in a few months. Pete Wailes, Operations Director of SEOgadget (@petewailes)Categorisation keywords by
Just one keyword on its own isn’t useful. Use indices to group them.
Collect all the data you can – from Analytics, rankings, anything you can think of – then put it in an Excel spreadsheet, label the keywords with their categories and use pivot tables to look at those categories. Report for your clients, not for yourself. Make sure you know about your client's media buys and other advertising in advance, so you can rank for their slogans. Laura Thieme, CEO of Bizwatch (@bizwatchlaura)If you see '*' in your keywords on Analytics, it's from product listing ads. You can see the SQR for PLAs in AdWords but not Analytics. You want to know the extreme successes or extreme failures – filter to show keywords with more than 5 visits and more than 5% conversion rate (or whatever a good conversion rate is for you). Look at your data over time – see seasonal trends. Keywords get around 10% of the traffic that Wordtracker predicts. Don't just look at bounce rate, look at it along with time on site and pages viewed. Ready, Aim, Fire… Then Retarget!Anna Lewis, Digital Marketing Executive at Koozai (@Koozai_Anna)Why remarket? You've got a targeted audience: you know they’re already interested and they’re closer to converting. They are 70% more likely to concert according to Criteo. According to Periscopix, the average CPC for remarketing is £0.40, and the average CTR is 0.18%. To use Analytics remarketing you will need to change your Analytics code. But this modified code will be blocked by ad blocking software. Andre Scholten has instructions to avoid this. (Around 2% of users have ad blocking, although there are no firm numbers and the percentage will vary by industry – you have to judge for yourself whether implementing a workaround is worth it.) Ideas for how to split up remarketing audiences:
Tailor your ads to the remarketing audience. Use branding, as your audience already know your brand. Give an incentive to come back to your site. Always make sure you use frequency settings! Don’t spam people too much or it will work against you. Check your reach and frequency report to see where conversions drop off, so you know how to set your frequency cap. Ideally you want at least 500 users in you remarketing list, but you can use 100 as a compromise. Michael Benedek, CEO of DatonicsBehavioural targeting means delivering ads based on observed online behaviour. Retargeting is the most popular version – advertising to people who have already visited your site. Search retargeting allows you to advertise to users who didn’t necessarily visit your site, based on their search behaviour on third party sites. Data exchanges collect data from sites and make it available for people to target elsewhere. Anders Hjorth, owner of BDBL Media (@soanders)Anders gave a case study of French automotive accessory seller Oreca-store.com. They used IgnitionOne to remarket across lots of display networks, with banners personalised based on which parts of the site they spent time in. While Google dominates in search, there are other networks for display advertising like Bing, Yahoo and Facebook. Since end of last year, you can remarket on Facebook. You need to deduplicate conversions, otherwise you could attribute the same conversion twice to different sources. They have a mixed attribution model that's mostly last click but prioritises PPC and social media. Ask The Search Marketing ExpertsThis was a questions and answers session with Ann Stanley, Christine Churchill (president of KeyRelevance, @keyrelevance), Andy Atkins-Kruger and Mikkel deMib Svendsen. On enhanced campaigns: Ann is still hoping Google will allow mobile-only campaigns. Andy thinks they won't as they need more money from mobile to please stockholders. On graph search: Andy likes that Facebook are approaching search a different way to Google. Christine says the problem is that Facebook has rubbish search. Mikkel: “I don’t like my dentist. I don’t like my bank.” Facebook doesn’t have the data to properly recommend services based on his usage. On Bing: Microsoft have the advantage that Office is now SAAS – that should provide them with a wealth of data. Christine and Ann agree that Bing Ads has cheap CPCs, so they do advertise there, but it is limited by having a small market share in the UK. Andy says Bing seems to be focussing on the US market. Yandex have said they won’t go to the US as there’s no point. Would Bing be better off concentrating on other countries? On schema: Andy says you should mark up the things that make a difference. Don’t mark up everything. Mikkel remembers when metadata was used as a ranking factor – it stopped being a ranking factor as most sites didn’t have it or did it wrong. Now we’re bringing in schema, which is far more complicated – even fewer sites will be able to do it right. He says "it’s doomed." On (not provided): Christine says you can get the search terms from Webmaster Tools, and then you can roughly fit them to the (not provided) searches in Analytics based on landing pages. There is debate on the accuracy of Webmaster Tools data – Mikkel is sceptical. Andy says you can get good data if you “work the filters to death”. Ann says you've got to regard WMT data as a sample, and look at trends. © SEOptimise SMX London 2013 – Top Takeaways from the Paid Search and SMX Advanced Tracks            |
| 217 Takeaways from the SEO, Search and Social Track – SMX London 2013 Posted: 17 May 2013 03:13 AM PDT SEOptimise attended this year's SMX London, and came away with a number of amazing tips and takeaways. I have provided a list of all the takeaways that I took from the SEO, Search and Social Track. Day 1 – From Authorship To Authority: Why Claiming Your Identity MattersThe first session on the SEO track saw Chelsea Blacker, Grant Simmons, Jim Boykin and Google’s Maile Ohye talk about Authorship and how to enhance your authority in an industry. The main draw to the session was as you would expect Maile Ohye, with the hope she would give away some inside information. Unfortunately this didn’t happen, but she did confirm that a lot of what the speakers had discussed was correct. I managed to take a lot away from this session, but here are a few of the key points.
Killer Content Remains King, Queen and AceThis session was all about how to create great content, which has been a hot topic over the past 12 months. Chris Bennett, Vincent Wehren , Dixon Jones and Jonathan Stewart talked us through techniques and tactics of content creation and production. Below are some of the key points.
Hardcore SEO Power ToolsSEO Tools is a common panel at most search conferences and this was no different. Stacey Cavanagh, Dixon Jones, Pete Wailes and Steve Lock took us through a large range of SEO tools that they recommend. There was a lot of tools that have been mentioned over and over again, so I have removed a number of those and left the tools that were either new or had been recommended by others.
Is Link Building Still Crucial, or a Waste of Time & Money?With Penguin 2.0 on the horizon this was a hot topic of the day, and Tim Grice, Dave Naylor, Marcus Tober and Prashant Puri all gave different advice. What was evident was that all agreed that getting rid of bad links, no matter how many, was the first step to improving your link building efforts. Below are the key points that I had from the session.
Day 2Tuning Up Your Twitter TacticThe first session of the day brought up some thought-provoking ideas, and some that caused a lot of debate on Twitter. Mike Essex, Brent Gleeson (ex Navy Seal :|) and JimYu gave some great insight into what customers find useful, what you need to be doing to improve content distribution, and how to find influencers online. My key takeaways are below.
Facebook's New Graph Search & Its Marketing ImplicationsThis next session took us into the world of Facebook, with Kelvin Newman, Mark Purtell and Justin Sanger. I have to say this was one of the best sessions that I was in, mainly due to how intensely Justin Sanger delivered his presentation. The delivery and content provided were great. Here are my takeaways from that session.
Social Media Automation: The Good & BadHaving covered the main two players in the social media space, the attention turned to automation and whether it is actually worth the risk. Samuel Bueno de Mezquita, Bas Van Den Beld and Aaron Wester discussed how they each used automation of their websites and what their recommended strategies were. Here are my key takeaways.
SEO & Google+The final session of the day turned to SEO and Google+. Wayne Sleight, Marcus Tober, Jim Yu and Kevin Gibbons provided some interesting data, that included not only statistics to prove that Google+ is growing, but how brands are starting to implement and engage with it. My key take aways are below.
Well, it was a busy few days, with lots of takeaways that will keep us busy for few months. What did you think of the conference, and have I missed anything that you thought was key? I look forward to hearing from you in the comments below or on Twitter @danielbianchini. © SEOptimise 217 Takeaways from the SEO, Search and Social Track – SMX London 2013      |
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Seth's Blog : No Signal
No Signal
At a party the other day, I saw a dead TV monitor. On the screen it said something like, "No signal... check power, cable and source selection..."
It doesn't matter at all how hard the DVD player was trying to put on a show. It is irrelevant how good the show on cable was. If it's not getting through, no one sees it.
All of us own our own media companies now. We each have the ability to speak up, to tell our stories, and if we're good and if we're lucky, to be heard.
Too often, though, there's no signal. You may be pumping noise through your social media outlets, but noise isn't signal. It's merely a distraction. You're talking, but you're not saying anything, at least nothing that's being heard.
You get to choose your story. If the story you've chosen doesn't get through, it's up to you to fix that. Pick a story that reflects your work, sure, but also one that resonates with the receiver.
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duminică, 19 mai 2013
Mish's Global Economic Trend Analysis
Mish's Global Economic Trend Analysis |
| EU On Collision Course With Germany Over Tariffs; Yet Another Reason for UK to Exit EU Posted: 19 May 2013 10:41 PM PDT The threat by the EU to impose huge tariffs on solar panels from China has run into staunch opposition. The Financial Times reports Germany warns EU solar tariffs would be 'grave mistake' Germany's vice-chancellor and economy minister put Berlin on a collision course with Brussels by warning that imposing anti-dumping duties on solar panels from China would be a "grave mistake".Damage of Tariffs I do not believe it is possible to accurately predict the damage caused by inane tariffs. Much depends on how China would respond. But even if China did not respond, there is no advantage to artificially forcing up prices. Tariffs are simply a bad idea, period. As I have pointed out, much of the European overcapacity that led to the price crash was caused by European subsidies. Somehow it is OK for Europe to offer subsidies but not China. EU policy is also hypocritical in regards to its stated emphasis on clean energy. For further discussion, please see Paul Krugman "Was" Right. Yet Another Reason for UK to Exit EU Note the continual bickering by Germany with the EU and with France over trade, over eurobonds, over a political union, over agricultural policy, over everything. Why Cameron wants the UK to stay in the EU is a complete mystery, especially when the UK fears additional nannycrat idiocies like financial transaction taxes. Fortunately the UK tide is changing, as a recent Poll Shows 46% in UK Want to Exit EU, 30% Want to Stay In. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com |
| Folly of Preserving the Euro at All Costs; Should France Lead Breakup of Euro? Posted: 19 May 2013 08:47 AM PDT The Local, a website with German news in English reports Economists warn against German euro exit. "Even a believable rumour that Germany would exit the euro would result in a massive capital flight from the countries of southern Europe to Germany." Complete Rubbish As is typically the case in such articles, the eurozone proponents ignore the costs of staying in the euro and overly trump up the benefits. The article perpetuates the myth that German taxpayers will suffer the consequences of a breakup, but suffer no costs if the eurozone stays intact. Nothing could be further from the truth. As I have pointed out on many occasions, Germany is going to pay a steep price either way, and so will Europe. The cost to Europe on the current path will be another decade of Southern European depression, resentment, and capital controls. Somewhere along the line, citizens in one or more countries will decide they have had enough, and vote to exit the Euro anyway. It is a huge mistake to believe Germany can impose its will on Southern Europe forever while not paying through the nose with eurobonds or other transfer mechanisms. If Germany returns to the D-mark, it will get paid back in cheaper Euros, but it least its stands a chance of getting paid back. On the other hand, target-2 imbalances are so great the cost of a destructive piecemeal splintering of the eurozone coupled with outright default, will be much higher. Many economists don't see this simply because they do not want to. Should France Lead Breakup of Euro? I have argued that the best way to breakup the eurzone would be a German exit. Politically speaking that could be doable once Merkel is gone. But then aagin, perhaps not. The problem is Germany has been the biggest beneficiary of this failed experiment, and will not give up those benefits easily, even if mathematically it must eventually (and destructively) happen anyway. In a Bloomberg column, authors Brigitte Granville, Hans-Olaf Henkel, and Stefan Kawalec argue France Must Lead Breakup of Euro Many observers concede that the euro was a mistake but think there's no going back. They reckon that dissolving the monetary union would lead to economic chaos, first in Europe, and then around the world. European leaders are afraid that backtracking on the euro project would also be a lethal blow to the larger cause of European integration and could be the beginning of the end of the EU and the single market. These fears give rise to what we regard as the disastrous strategy of defending the euro at all costs.The authors present an interesting viewpoint, well worth a closer look. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com |
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