Mish's Global Economic Trend Analysis

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• Another US Foreign Policy Success: Isis Controls Half of Syria after Palmyra Seizure
• Existing Home Sales Lower Than Any Economist's Estimate; Rising Supply a Good Thing?
• Philly Fed Region "Weak but Stable"; Kansas City Region "Declines More Sharply"
• China Manufacturing PMI Contracts Third Month, Output Index at 13 Month Low

Another US Foreign Policy Success: Isis Controls Half of Syria after Palmyra Seizure Posted: 21 May 2015 08:32 PM PDT Congratulations are in order for team Bush and team Obama for another stunning US foreign policy success: Isis Controls Half of Syria after Palmyra Seizure. Fighters from the Islamic State of Iraq and the Levant (Isis) have seized the Syrian city of Palmyra, home to a Unesco world heritage site, putting nearly half of Syrian territory in the jihadi group's hands and sparking fears that treasured antiquities may be destroyed. Isis announced it had "complete control" of the city on Thursday, and state television said President Bashar al-Assad's forces had withdrawn from the city, which is known to most Syrians by its Arabic name Tadmur. Ancient Palmyra is known to the world for its iconic avenue of Roman columns, and was a cultural crossroad of the ancient world. The city dates back to the 1st century, when it was an oasis on a trade route linking eastern civilisations with the Roman empire. Its ruins lie to the southwest of modern Tadmur. "Palmyra is an extraordinary World Heritage site in the desert and any destruction to Palmyra [would be] not just a war crime but . . . an enormous loss to humanity," Unesco head Irina Bokova said in a video. Isis has developed a reputation for destroying or selling cultural treasures. Earlier this year it filmed its fighters smashing Assyrian artefacts at sites in northwestern Iraq. Moderate Rebels Defect In case you are wondering how this happened, please consider this IBTimes report from March 7, 2015: US-Backed Moderate Syrian Rebels In North Defect; Obama Strategy Set Back. It was supposed to be a crucial instrument of the Obama administration's aims in Syria, an ostensibly moderate rebel fighting force that would keep the pressure on the authoritarian regime in Damascus without aiding the ruthless jihadist forces that have captured much of the country. But the soldiers of Harakat Hazzm -- the first Syrian rebel group to receive arms from the CIA -- disbanded this week. As a result, much of northern Syria is in the hands of the extremists, and the United States is left with no palatable ally in the area in the midst of a regional conflict that continues to spiral out of control. Hillary Backs Moderates Please recall that Hillary was in favor of backing "moderate" rebels. But it is not just Democrats who want to back "moderates". Chief warmonger, Republican Senator John McCain, does as well. Has anyone bothered to question if we are even backing the right person? Iran is actually our ally here. Iran wants to help the US fight ISIS. The only problem is Iran backs Syrian president Assad, while the goal of the US is to overthrow Assad to alleged "moderates". Roots of Crisis This is exactly the kind of idiocy one can expect when you think you can "nation build". Without a doubt the roots of this crisis date back to the inane decision by George Bush to invade Iraq. But please recall that Hillary was in favor of invading Iraq as well. The non-amusing fact in this mess is the policies of George Bush, Obama, and Hillary Clinton are similar if not identical. Yet, Republicans blame Obama and Democrats blame Republicans. The only candidate who has an alternative plan to this mess is Senator Rand Paul. Contemplating Success Some may ask "Mish, how the hell can you call this disaster a success?" The answer is simple: In spite of what they may say, the goal of mainstream Republicans and Democrats is obviously perpetual war. A destruction of a major historic site in Palmyra will have even some peacemongers clamoring for retaliation. Make no bones about it, the takeover of Palmyra was a major US foreign policy success, provided you understand the goal. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

Existing Home Sales Lower Than Any Economist's Estimate; Rising Supply a Good Thing? Posted: 21 May 2015 12:26 PM PDT Existing Home Sales Disappoint Economists overestimated existing home sales today, rounding out another impressive day of overoptimism. New home sales came in at a seasonally adjusted 5.04 million annualized rate. The Bloomberg Consensus Estimate was 5.22 million. 5.04 million was below the lower end of the consensus range of 5.10 M to 5.32 M. Existing homes sales are not living up to springtime expectations, down 3.3 percent in April to a 5.04 million annual rate which is just below the low-end Econoday forecast. Three of 4 regions show contraction in April with the sharpest decline, minus 6.8 percent, in the South, which is by far the largest housing region. Year-on-year, total sales are still up a respectable 6.1 percent. Another positive is a rise in supply with 2.21 million used homes on the market vs 2.01 million in March. This rise, together with the drop in sales, raises supply relative to sales to 5.3 months from 4.6 months. And another positive is a 4.1 percent rise in the median price to $219,400 which is up 8.9 percent year-on-year. But this report in sum is a disappointment, failing to point to any building momentum. Strength in the housing sector may be switching, from existing home sales to new home sales at least based on this report compared to the historic surge earlier this week in housing starts & permits. But housing data month-to-month are always volatile and, on net, it's too soon to decipher how strong the spring housing season is right now. Existing Home Sales Existing Home Sales Month's Supply Rising Supply a Good Thing? Bloomberg says "Another positive is a rise in supply with 2.21 million used homes on the market vs 2.01 million in March. This rise, together with the drop in sales, raises supply relative to sales to 5.3 months from 4.6 months." That strikes me as circular reasoning, if not completely ridiculous. Month's supply will automatically rise when sales decline. Supply rising in 2005 was a sign of a major problem coming up. Apparently it's different this time. The Goldilocks' theory, which I find absurd, is that low supply is what's holding back buyers. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

Philly Fed Region "Weak but Stable"; Kansas City Region "Declines More Sharply" Posted: 21 May 2015 10:46 AM PDT More weak economic reports came out today. Let's take a look at two regional manufacturing reports. Philly Fed Region "Weak but Stable" The Bloomberg Economic Consensus for the Philadelphia Fed Business Outlook Survey was 8.0. Economists got the leading sign correct, but the consensus estimate was a tad high with the index posting 6.7. Activity in the Mid-Atlantic manufacturing sector is slow but stabilizing, based on the Philly Fed's general conditions index which came in at 6.7 for May, down slightly from 7.5 in April and against Econoday expectations for 8.0. The best news in the report is a slight uptick in new orders, to 4.0 from 0.7. This isn't searing but is at least in the plus column as are shipments, at 1.0 from minus 1.8. Employment, at 6.7, is also in the plus column. Manufacturers in the region are reporting significant price contraction, especially in costs which is a surprise given the rise underway in oil prices. Manufacturers are also reporting declining prices for finished goods as well. These inflation readings, if repeated in subsequent reports, will give the edge to the doves at the Federal Reserve. A plus in the report is a healthy reading of 33.9 for the 6-month outlook, down only slightly from April's 35.5 and up from 32.0 in March. The manufacturing sector, hit by weak exports and trouble in the energy sector, has yet to find its footing this year but this report, which is very closely watched, points to stability that in turn hints at a rebound in the months ahead. Weak Demand In light of rising energy prices, price contraction especially in finished goods tells the real story: very weak demand. The six-month outlook is meaningless. Such readings are perpetually overoptimistic except at the bottom of recessions. Industrial production will go nowhere with readings like these. I suggest things appear to be "stabilizing" before the next decline. Philly Fed vs. Industrial Production Kansas City Fed Consensus Way Too Optimistic The range of economists' estimates for the Kansas City Fed Business Outlook Survey was -1 to +1. Economists were not even close on this one. The early indications on May's manufacturing activity have been slightly positive, that is until the Kansas City Fed report where the composite index is in deeply negative ground at minus 13. This is the weakest of the recovery for this reading and follows an already weak minus 7 in April. New orders this month are deeply negative, at minus 19, as are backlog orders at minus 21. These readings, reflecting contraction for export orders and trouble in the energy sector, point to significant trouble for the region's manufacturing activity in the months ahead. Shipments are already in contraction, at minus 9, as is employment, at a deeply negative minus 17 that contrasts with mostly positive employment indications in other reports. Kansas City Region "Declines More Sharply" The Federal Reserve Bank of Kansas City reports Tenth District Manufacturing Declines More Sharply. According to Chad Wilkerson, vice president and economist at the Federal Reserve Bank of Kansas City, the survey revealed that Tenth District manufacturing activity declined more sharply in May and producers' expectations also fell, with both reaching their lowest levels since mid - 2009. "Factories in our region saw an even sharper decline in May than in March or April, as exports fell further and energy - related producers saw another drop in orders," said Wilkerson. "However, firms' overall still plan a modest in crease in employment over the next six to twelve months." The month-over-month composite index was -13 in May, down from -7 in April and -4 in March. The last time the composite index was lower was in April 2009. The composite index is an average of the production, new orders, employment, supplier delivery time, and raw materials inventory indexes. The overall slower growth was mostly attributable to declines in durable goods manufacturing, including a continued decline in aircraft production and further weakness in metals and machinery. In addition, several nondurable goods plants also reported sluggish activity, particularly for plastics and food production. Production fell most sharply in energy-producing states like Oklahoma and New Mexico, but it was also down in most other District states. The majority of other month - over - month indexes also decreased from the previous month . T he production index contracted from -2 to -13, and the shipments and new orders index es also fell. The order backlog, employment, and new orders for exports indexes edged higher but still remained well below zero. The finished goods inventory index increased from - 1 to 0, while the raw materials inventory index dropped into negative territory. Recession in KC Region If it appears the KC region is in recession, it's because it probably is. Nonetheless, favorable expectations six months out refuse to die. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

China Manufacturing PMI Contracts Third Month, Output Index at 13 Month Low Posted: 21 May 2015 02:20 AM PDT The slowdown in China continues as the HBSC Flash PMI shows Output contracts at strongest rate in just over a year. Key Points Flash China Manufacturing PMI™ at 49.1 in May (48.9 in April). Two-month high. Flash China Manufacturing Output Index at 48.4 in May (50.0 in April). 13-month low. Commenting on the Flash China Manufacturing PMI survey, Annabel Fiddes , Economist at Markit said: "The Flash China Manufacturing PMI pointed to a further deterioration in operating conditions in May , with production declining for the first time in 2015 so far. "Moreover, softer client demand, both at home and abroad, along with further job cuts indicate that the sector may find it difficult to expand, at least in the near - term, as companies tempered production plans in line with weaker demand conditions. "On a positive note, deflationary pressures remained relatively strong, with both input and output prices continuing to decline, leaving plenty of scope for the authorities to implement further stimulus measures if required." The positive note is "deflationary pressures are strong so that leaves scope for stimulus." Isn't that a hoot? And if there was strength, that would be a positive as well. I guess it's simply impossible for things not to be bullish. Two Point Summary Economy weak - stimulus needed - stimulus is bullish Economy strong - no stimulus needed - also bullish Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

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Meet Voytek The Bear That Was Raised By Soldiers Posted: 21 May 2015 07:32 PM PDT Voytek is a bear that lived a life unlike any other before or after him. Voytek was officially an enlisted as a soldier in the Polish Army and became a dear friend to the humans who raised him.

These Animals Clearly Don't Know The Meaning Of Sexual Harassment Posted: 21 May 2015 07:22 PM PDT This is living proof that animals get away with so many things humans would go to jail for doing.

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The Long Click and the Quality of Search Success - Moz Blog

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The Long Click and the Quality of Search Success Posted on: Thursday 21 May 2015 — 02:16 Posted by billslawski "On the most basic level, Google could see how satisfied users were. To paraphrase Tolstoy, happy users were all the same. The best sign of their happiness was the "Long Click" — This occurred when someone went to a search result, ideally the top one, and did not return. That meant Google has successfully fulfilled the query." ~ Steven Levy. In the Plex: How Google Thinks, Works, and Shapes our Lives I often explore and read patents and papers from the search engines to try to get a sense of how they may approach different issues, and learn about the assumptions they make about search, searchers, and the Web. Lately, I've been keeping an eye open for papers and patents from the search engines where they talk about a metric known as the "long click." A recently granted Google patent uses the metric of a "Long Click" as the center of a process Google may use to track results for queries that were selected by searchers for long visits in a set of search results. This concept isn't new. In 2011, I wrote about a Yahoo patent in How a Search Engine May Measure the Quality of Its Search Results, where they discussed a metric that they refer to as a "target page success metric." It included "dwell time" upon a result as a sign of search success (Yes, search engines have goals, too). Another Google patent described assigning web pages "reachability scores" based upon the quality of pages linked to from those initially visited pages. In the post Does Google Use Reachability Scores in Ranking Resources? I described how a Google patent that might view a long click metric as a sign to see if visitors to that page are engaged by the links to content they find those links pointing to, including links to videos. Google tells us in that patent that it might consider a "long click" to have been made on a video if someone watches at least half the video or 30 seconds of it. The patent suggests that a high reachability score on a page may mean that page could be boosted in Google search results. But the patent I'm writing about today is focused primarily upon looking at and tracking a search success metric like a long click or long dwell time. Here's the abstract: Modifying ranking data based on document changes Invented by Henele I. Adams, and Hyung-Jin Kim Assigned to Google US Patent 9,002,867 Granted April 7, 2015 Filed: December 30, 2010 Abstract Methods, systems, and apparatus, including computer programs encoded on computer storage media for determining a weighted overall quality of result statistic for a document. One method includes receiving quality of result data for a query and a plurality of versions of a document, determining a weighted overall quality of result statistic for the document with respect to the query including weighting each version specific quality of result statistic and combining the weighted version-specific quality of result statistics, wherein each quality of result statistic is weighted by a weight determined from at least a difference between content of a reference version of the document and content of the version of the document corresponding to the version specific quality of result statistic, and storing the weighted overall quality of result statistic and data associating the query and the document with the weighted overall quality of result statistic. This patent tells us that search results may be be ranked in an order, according to scores assigned to the search results by a scoring function or process that would be based upon things such as: Where, and how often, query terms appear in the given document, How common the query terms are in the documents indexed by the search engine, or A query-independent measure of quality of the document itself. Last September, I wrote about how Google might identify a category associated with a query term base upon clicks, in the post Using Query User Data To Classify Queries. In a query for "Lincoln." the results that appear in response might be about the former US President, the town of Lincoln, Nebraska, and the model of automobile. When someone searches for [Lincoln], Google returning all three of those responses as a top result could be said to be reasonable. The patent I wrote about in that post told us that Google might collect information about "Lincoln" as a search entity, and track which category of results people clicked upon most when they performed that search, to determine what categories of pages to show other searchers. Again, that's another "search success" based upon a past search history. There likely is some value in working to find ways to increase the amount of dwell time someone spends upon the pages of your site, if you are already having some success in crafting page titles and snippets that persuade people to click on your pages when they those appear in search results. These approaches can include such things as: Making visiting your page a positive experience in terms of things like site speed, readability, and scannability. Making visiting your page a positive experience in terms of things like the quality of the content published on your pages including spelling, grammar, writing style, interest, quality of images, and the links you share to other resources. Providing a positive experience by offering ideas worth sharing with others, and offering opportunities for commenting and interacting with others, and by being responsive to people who do leave comments. Here are some resources I found that discuss this long click metric in terms of "dwell time": Increasing Time-on-Page Through Aesthetics (Lessons Learned from PRWeb and BuildZoom - Two Large Content Sites) Dwell Time: The Most Important Metric You're Not Measuring Four Branding Efforts that Can Increase User Dwell Time Your ability to create pages that can end up in a "long click" from someone who has come to your site in response to a query, is also a "search success" metric on the search engine's part, and you both succeed. Just be warned that as the most recent patent from Google on Long Clicks shows us, Google will be watching to make sure that the content of your page doesn't change too much, and that people are continuing to click upon it in search results, and spend a fair amount to time upon it. (Images for this post are from my Go Fish Digital Design Lead Devin Holmes @DevinGoFish. Thank you, Devin!) 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!

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