vineri, 2 octombrie 2015

Damn Cool Pics

The World's Longest Glass Bridge In China Is Insane

Posted: 02 Oct 2015 04:53 PM PDT

This glass bridge will offer you an absolutely breathtaking view of China, that is if you're brave enough to cross it.

These Are The Top 10 Highest IQs in Human History

Posted: 02 Oct 2015 01:40 PM PDT

These are the people that pushed their brains to the limit and reached levels of intelligence most people could only dream of.

Using Social Media as Your Primary (or Only) Link Building Tactic Probably Won't Work - Whiteboard Friday - Moz Blog

Using Social Media as Your Primary (or Only) Link Building Tactic Probably Won't Work - Whiteboard Friday

Posted by randfish

A concept we've covered regularly is what we call flywheel marketing, where the organic traffic, shares, and links you get from publishing one piece of content makes it easier for later pieces to see some success. One of the key pieces of that flywheel is the ability to get those social shares, and based on a recent study, we're ready to admit it: We were completely wrong about that key piece.

In today's Whiteboard Friday, Rand explains why, and that the real value may lie in engagement.

Click on the whiteboard image above to open a high resolution version in a new tab!

Video transcription

Howdy, Moz fans, and welcome to another edition of Whiteboard Friday. This week we're talking about an assumption that I think many of us have made over the years. I know I have. In fact, I've amplified that. I might have even covered it on Whiteboard Friday. Thanks to some research that we've done together with BuzzSumo, as well as some research we've seen from our correlation study this summer, you know what? It's looking like we were just dead wrong on this very important aspect of how SEO and social media and content marketing fit together.

You've probably seen me present on this either here on Whiteboard Friday or in one of my slide decks or in a blog post. It's this idea of flywheel marketing, where you create some great content, you amplify that content via social media and your social channels, you attract visitors through that, you naturally earn links from some of those people who visit your site, and you grow your social following. Now, the next time your audience potential is bigger and your rankings potential is also bigger, because you have more links coming to your site, and that helps all the other pages on your site. You have a bigger social audience, so now there are more people to amplify to.

You know what? It actually looks like this is totally broken and wrong. The idea that you are naturally earning links from people who come via social looks to us like it was a bunk belief in its entirety. Let me show you.

First off, BuzzSumo did the vast majority of the work. I appreciate them including Moz as well. We did participate in some of our link metrics. The BuzzSumo crew did a bunch of this work. They looked at articles that received social shares, in fact a million articles that were taken from their database, and then they looked at the number of shares and the number of links those received.

The vast, vast majority received zero links. In fact, 75% plus of all articles they looked at received zero, not a single one, social shares. Same with links, by the way. I think it was 90% plus for links or maybe even more.

This is a like a power-law distribution. You're essentially seeing that a few articles get all the shares out there. Everything else really gets nothing. If you're not going to be in the top 10% of content that's created, don't even bother. You're not going to get shares. You're not going to get links. You're not going to get traffic. Forget it. A lot of content marketing is probably spent in vain. Granted, maybe a lot of that is learning what actually works and experimenting, and that's fine.

Then they looked at the correlation between links and shares.

As you can see from this crudely drawn scatter plot, no correlation whatsoever. If you were to draw the line here, it would probably be something like, "Oh look at that total crap correlation." Here are the numbers. Facebook, 0.0221. Twitter, 0.0281. Ooh, slightly better, but still in the realm of totally insignificant. Google+ 0.0058. You're just talking about numbers that suggest essentially that there is virtually no correlation between links and shares.

Now they did look at places where there were lots of shares and links, and those tended to be a few things. I'll let you read the report, and you should. I think it's one of the most important reports to come out in our industry in a while. Credit to BuzzSumo for putting it together.

We know from our research. We've done experiments looking at whether anchor text still moves things. We've done experiments looking at whether URL mentions move the needle. URL mentions don't, by the way. Once you turn them into live links, they do. We've looked at whether you can actually rank content without any links at all. It turns out almost impossible, so next to impossible that we couldn't find a single credible example of a page that ranked without any links unless it was on a site that had lots of links pointing to it.

We know we still need links to rank.

In fact, notably ranking correlations with links haven't dropped over the last few years. Even though we all feel like the algorithm's getting a little less link centric, and I think it is, links are still clearly very, very powerful. So we have to worry about things like outreach and link focused content and embeds and tools and badges and competitive link analysis and all the other many link building methods that the marketing industry has come up with over the years.

I have a theory about why this is.

I think Google is honest when they tell us, "We don't look at social shares to determine rankings." I think what Google sees is something Chartbeat showed a few years ago. This was another excellent study that I encourage you to check out. Chartbeat basically analyzed engagement on socially shared content. What they saw was a plot that looks like this. Very, very few social articles have high read time. Even the ones that have lots of social sharing have very little read time.

It turns out a ton of things that people share socially on the Web, they don't read at all. They may click Retweet. They may even include the URL. They might share it on Facebook. But they, themselves, may never have even visited that content. Sounds crazy, but I bet you've done it. I bet I've done it. I bet I've been like well, you know, it was probably a good edition of Whiteboard Friday, I'll go share it out, having not yet watched the video and seen whether I did a good job or not. That's just the way of the Web.

I think Google cares much more about the engagement than they do about the social share counts themselves.

So you can see lots of things with social shares not performing well. But once they start to get engagement and start to earn links from that engagement, now they're suddenly ranking.

Hopefully, with this knowledge in mind, you can go back to the drawing board a little bit if you've built up, like we have, this mental model of how the flywheel works. Look, I'm not saying that this works for no one. This actually works pretty well for Moz. It works pretty well for us in this industry, but I think, and clearly the data is showing, that across the vast majority of the Web it's statistically extremely unlikely this will work for you or for everyone else.

I think we need to revisit this. We probably need to revisit our link building. We need to think about social in a different context of how and whether it's earning people who will actually come to our site and want to link to us and people who will come to our site and want to engage, or whether it's just a vanity metric.

All right, everyone, I look forward to your comments. We'll see you again next week for another edition of Whiteboard Friday. Take care.

Video transcription by Speechpad.com

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Seth's Blog : On feeling like a failure

On feeling like a failure

Feeling like a failure has little correlation with actually failing.

There are people who have failed more times than you and I can count, who are happily continuing in their work.

There are others who have achieved more than most of us can imagine, who go to work each day feeling inadequate, behind, and yes, like failures and frauds.

These are not cases of extraordinary outliers. In fact, external data is almost useless in figuring out whether or not someone is going to adopt the narrative of being a failure.

Failure (as seen from the outside) is an event. It's a moment when the spec isn't met, when a project isn't completed as planned.

Feelings, on the other hand, are often persistent, and they are based on stories. Stories we tell ourselves as much as stories the world tells us.

As a result, if you want to have a feeling, you'll have it. If you want to seek a thread to ravel, you will, you'll pull at it and focus on it until, in fact, you're proven right, you are a failure.

Here's the essential first step: Stop engaging with the false theory that the best way to stop feeling like a failure is to succeed.

Thinking of one's self as a failure is not the same as failing. And thus, succeeding (on this particular task) is not the antidote. In fact, if you act on this misconception, you are setting yourself up for a lifetime of new evidence that you are, in fact, correct in your feelings, because you will ignore the wins and remind yourself daily of the losses.

Instead, begin with the idea that the best way to deal with a feeling is to realize that it's yours.

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joi, 1 octombrie 2015

Mish's Global Economic Trend Analysis

GDPNow Forecast Plunges to 0.9% Following Advance Report on US Balance of Goods
Three Month Treasury Yields Turn Negative; Long End Flattening; Economy Strengthening or Recession Warning?
Pro-Independence Parties in Catalonia Unite to Form Government; Showdown with Madrid Coming Up
ISM Flirts with Contraction, Export Orders and Backlogs Contract for 4th Month

GDPNow Forecast Plunges to 0.9% Following Advance Report on US Balance of Goods

Posted: 01 Oct 2015 05:58 PM PDT

The past few days have seen significant swings in the Atlanta Fed GDPNow Forecast.

We are right back to the initial forecast in August.

What Happened?

On September 28 following the Personal Income and Outlays Report, the forecast rose 0.4 percentage points to 1.8%.
On September 29, following the Census Bureau Advance Trade Report the forecast fell 0.7 percentage points to 1.1%.
On October 1, following the Manufacturing ISM report, the forecast fell another 0.2 percentage points to 0.9%.

ISM Discussion

See my discussion ISM Flirts with Contraction, Export Orders and Backlogs Contract for 4th Month.

Advance Trade Numbers

Let's investigate the Census Report Numbers to see what's behind the 0.7 percentage point plunge on September 29.

The following table I put together will help visualize what happened. Numbers are in millions of dollars. Pay attention to the seasonally adjusted numbers.

Month	Seasonally Adjusted Balance of Goods	Unadjusted Balance of Goods
January	-59,815	-57,405
February	-55,218	-43,328
March	-70,527	-64,390
April	-60,422	-61,423
May	-59,747	-57,046
June	-62,256	-64,838
July	-59,123	-68,360
August	-67,187	-68,025

Notes:

The numbers represent the balance of goods, not balance of trade (goods plus services). The full report will be available on October 6.
The seasonally-adjusted balance of goods deficit unexpectedly widened from $59.123 billion to $67.187 billion.

For the deficit to widen, exports fell, imports rose, or both. Certainly manufacturing exports fell for the 4th consecutive month as noted by the ISM report.

Recall that imports subtract from GDP and exports add to GDP.

GDP Revisions

On September 25, the BEA upped the Second Quarter GDP estimate from 3.6% to 3.9% based on "an upturn in exports, an acceleration in PCE, a deceleration in imports, an upturn in state and local government spending, and an acceleration in nonresidential fixed investment that were partly offset by decelerations in private inventory investment and in federal government spending."

Evolution of First Quarter 2015 GDP

+0.2% Initial
-0.7% Revised
-0.2% Revised
+0.6% Revised

GDP Quarter by Quarter

1st Quarter: 0.6%
2nd Quarter: 3.9%
3rd Quarter: 0.9% GDPNow Model

If those numbers hold, the average is about 1.8% annualized. Anyone think downward revisions coming?

Question number two: Anyone think the Fed will hike if 3rd quarter GDP is close to or below 1%?

Mike "Mish" Shedlock

Three Month Treasury Yields Turn Negative; Long End Flattening; Economy Strengthening or Recession Warning?

Posted: 01 Oct 2015 12:05 PM PDT

Curve Watcher's Anonymous points out 3-month treasury yields dipped briefly negative on several days recently.

Yield on the 3-month bill was negative again today. Here is a table I put together with Treasury Yield Quotes from Bloomberg.

Treasury Yields vs. Month and Year Ago

Duration	Current Yield	Yield Month Ago	Yield Year Ago	Yield vs. Month Ago	Yield vs. Year Ago
3-Month	-0.02	0.03	0.00	-0.05	-0.02
6-Month	0.07	0.26	0.04	-0.19	0.03
1-Year	0.29	0.36	0.09	-0.07	0.20
2-Year	0.64	0.71	0.52	-0.07	0.12
5-Year	1.36	1.49	1.67	-0.13	-0.31
10-Year	2.03	2.15	2.39	-0.12	-0.36
30-Year	2.85	2.92	3.10	-0.07	-0.25

One could also use US Department of Treasury Daily Treasury Yield Curve Rates to produce an end-of-day view as opposed to the intraday snapshop above and chart below.

Yield Curve vs. Month Ago and Year Ago

click on chart for sharper image

Long End Flattening

The time line is not to scale, but the above chart still tells the correct story. In particular, note a negative rate at the front end and the flattening at the long end of the curve vs. a month ago and a year ago.

Economy Strengthening?

Three month treasuries should not be negative in a rate hike environment.

Yields at the short end of the curve, from 6-months to 2-years are slightly higher than a year ago, an indication of anemic hikes. But if hikes are coming, rates should not be lower than a month ago.

The yield on 6-month treasuries actually declined 19 basis point in past month.

Are hikes really coming?

Recession Warning

None of this should be happening in a rising rate environment with an allegedly strengthening economy.

In fact, action at the long end of the curve coupled with negative yields at the very front end is outright recessionary behavior.

Mike "Mish" Shedlock

Pro-Independence Parties in Catalonia Unite to Form Government; Showdown with Madrid Coming Up

Posted: 01 Oct 2015 10:54 AM PDT

Pro-independence parties in Spain won an outright majority in the Catalonia regional election. The open issue was whether or not the two parties could come to terms and form a government.

Election Final Results

Note that prime minister Mariano Rajoy's PP party only got 8.5% of the vote. Suppress people long enough, and radical parties eventually take over.

Prior to the election, the leaders of CUP stated they would not work with Artur Mas, the leader of Junts pel Sí (Together for Yes).

Today they worked out their differences and will form a coalition regional government.

Shared Power

El Pais reports CUP Proposes a Presidency with Shared Power in Catalonia.

The number two of the CUP in the Catalan elections, Anna Gabriel, proposed Thursday that the new Government would have a "coral presidency", with "three or four profiles with a weight equivalent" to share power, without demanding the political "burial" of Artur Mas.

The shared government alternative would unlock the choice of Catalan president, and allow an active role for Artur Mas.

CUP Platform

CUP is a Popular Unity Candidacy. The CUP platform is what I would call radical leftist.

The CUP broadly refers to their economic model as socialist. Their political program calls for a "planned economy based on solidarity, aimed towards fulfilling the needs of the people", and defends the nationalization of public utilities, as well as transportation and communication networks. They also call for a nationalization of all banks receiving government bailouts and consider the public debt "illegitimate".

The CUP call for an end to nuclear energy, with the use of sustainable energy in its stead. They also call for a ban on GMOs (genetically modified organisms) and the creation of an "ecological economy".

Showdown with Madrid Coming Up

The socialist ideas of these groups cannot and will not work.

Nonetheless, they are going to try. Reuters reports Victorious Separatists Claim Mandate to Break with Spain.

Both groups stated they would "unilaterally declare independence within 18 months under a plan that would see the new Catalan authorities approving their own constitution and building institutions like an army, central bank and judicial system."

A serious showdown with Madrid is around the corner. Already, Madrid preemptively acted as noted in Spain's Secessionist Party Leaders to be Charged with "Act of Disobedience"

Mike "Mish" Shedlock

ISM Flirts with Contraction, Export Orders and Backlogs Contract for 4th Month

Posted: 01 Oct 2015 09:40 AM PDT

The ISM is positive at 50.2, but barely above the 50.0 break-even mark, and a bit below the Bloomberg Consensus Estimate of 50.5.

The ISM index, like nearly all other September indications, is pointing to trouble for the factory sector. At 50.2, the index is at its lowest point since May 2013. New orders, at 50.1, are at their lowest point since August 2012. Backlog orders, at a very low 41.5, are in their fourth month of contraction and won't be giving manufacturers much breathing room to keep up production. Export orders, at 46.5, are also in their fourth month of contraction and are a key factor behind the general weakness.

Production, at 51.8, continues to hold up better than orders but not by much and probably not for long given the weakness in orders. Input prices are in deep contraction at 38.0 which is the weakest reading since early in the year when oil prices broke down.

The ISM Peaked in September of 2014

Together with the various regional reports, manufacturing is clearly in recession. When was the last time the Fed hiked with such weakness?

Mike "Mish" Shedlock

At Last, You Can Now Add Users to Your Moz Pro Account! - Moz Blog

At Last, You Can Now Add Users to Your Moz Pro Account!

Posted by adamf

Over the past few years, one feature has been requested more than any other. We call it Multiseat, which, at its core, is the ability for Moz Pro account owners to provide unique logins for their team members and/or clients.

Multiseat support is something that we have prioritized, reprioritized, started, and restarted, and for a number of reasons (some good, some less good) we never quite got there. Well, I'm happy to announce that after a great collaborative engineering effort, it is finally here!

We actually launched this feature quietly in August and have been monitoring usage and fixing issues to ensure Multiseat was ready for prime time before promoting it. So far hundreds of people are using it, and everything looks good!

In this post I'm going to describe what Multiseat does, how to set it up, who gets access, and what improvements are on the horizon.

What does Multiseat include today?

This first version of Multiseat supports most of the core functions requested by customers. These include:

You can set up unique logins for team members or clients

With Multiseat, you can add anyone who has or creates a free Moz community profile to your account. Previously the only way to share access was to share your password, which was far from ideal and not a great practice from a security perspective.

Multiseat can be useful in many scenarios:

Providing access to members of your team
Offering access to a client
Inviting a consultant to come help with your campaigns

Before Multiseat, if you were sharing your login, it was a pain to change and redistribute passwords if a team member left or a client engagement ended. Now that logins are separate from your core account, you can revoke access to someone who leaves and keep all of your other logins and passwords intact.

Billing information is now kept private to the account owner

This has been a common request, especially for larger organizations. Credit card and billing information is now kept private and is accessible only to the account owner.

You can independently control which account emails you receive

If your company has a lot of people managing a lot of campaigns, you may receive an awful lot of emails about data updates and completed reports, and for this email clutter I sincerely apologize. The good news is that each person with access to an account can now choose which campaigns to follow and thus limit emails from campaigns that aren't relevant.

You can be a seat on multiple accounts

We've heard that some of you engage with multiple clients, each with their own Moz account. You now have the ability to be added to as many client accounts as you need to. For each account to which you have been granted access, you will be able to log in with your own Moz login and password. No more asking each client to give you their login information, and then trying to remember them all.

Your Moz profile, community history and points will stay intact regardless of which accounts you've joined or left

Another benefit of this update is the separation of community profiles from Moz Pro accounts.

As a seat on one or more accounts, your MozPoints and interactions with the community can now follow you from engagement to engagement.

Sweet! So how do I add add new logins to my account?

If you go to your account settings, you'll find a brand new tab called Manage Seats (http://moz.com/account). Once here, you will have the option to add one or more of your colleagues to your account.

For more details on how to add seats check out this Q&A post.

Who has access to Multiseat?

All Moz Pro customers get access to Multiseat! Depending on your subscription level, you will have access to between 2 and an unlimited number of seats for your team to use. We packaged Multiseat into our existing subscriptions in a way that offers more seats for levels that are are more agency and team-focused.

That said, we are not yet totally sure how customers will be using this feature, so we will learn and tune as we go forward.

The current limits are as follows:

Subscription Level	No. of Seats
Standard	2 Seats
Medium	10 Seats
Large	25 Seats
Premium	Unlimited Seats
Enterprise	Unlimited Seats

What's next for Multiseat?

While we've added a lot of new functionality with this release, there are still some important features that we haven't yet been able to get to. Most notably:

Transfer of account ownership

The next addition we know we need to make is the ability to transfer ownership of an account from one individual to another.

Control over which campaigns a seat can access

For v1, everyone can see all tools and campaigns. We've already received requests to allow the account owner to restrict individual logins so they can only see a subset of campaigns.

Please send us feedback!

This is just the start. We need your help to make this even better. Tell us what critical capabilities we are lacking. Tell us where we built things wrong. Tell us what is confusing. Now that we've launched this feature, we really want to make it work for you.

Also, while I have your attention...

I wanted to call out a few other updates that we've made this summer, just in case you missed them:

Mobile Rankings

Not only have we added Google mobile rankings to our capabilities, but we also gave everyone an extra search engine slot so that you can track mobile rankings for all of your existing campaign keywords without giving up any other search engine data you've been tracking. We also added tracking of Google's "Mobile-friendly" tag, so you can see which of the pages you rank for Google considers to be mobile-friendly. Learn more

Search Visibility Scores

It's been a challenge in the past to see how your rankings are trending across keywords. Search visibility represents the percentage of clicks we estimate that you get based on your ranking position(s) for the keywords you track. Filter by brand or any other tag you've added to see visibility for certain keywords sets, and compare your visibility against your competitors. Learn more

On-Page Analysis workflow improvements

After a lot of good customer feedback, we rethought the on-page analysis feature workflow. Aside from a general facelift, we added the ability for customers to add keywords and pages to analyze and track, or to choose them from a list of suggestions that we update each week. Keep an eye out for some more significant improvements to this feature soon. Learn more

You can now keep up with all of our new Moz Pro features and updates

To help you find all of the new features and updates we make each week, we've added a What's New page that is accessible from any Moz Analytics campaign.

Well, that's about it. Thanks for taking some time to read about our new updates, and as always, don't hesitate to let us know what we can do to make Moz better for you.

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Seth's Blog : Choose your impact

Choose your impact

Is it that simple? Can you choose to make an impact?

Of course it is. You can choose to merely do your job, to meet spec and to follow someone else's path.

Or, you can dig in and transform your contribution. You can level up, taking advantage of the world-changing array of tools and connections our new economy is making available.

Access to tools is a small part of it. Mostly, it's about taking control over where you go and what you do with your gifts.

The dislocations of our time are significant, the sinecures are disappearing, there is real stress and pain as the world changes. We can't control that, but we can control how we respond to it.

Those changes open the door for those that choose to stand up and learn to contribute. A chance to be put on the hook instead of let off of it.

The altMBA is a workshop designed to push you to see more clearly, speak more effectively and create change that lasts. It's an intensive online group experience that works. You don't have to travel, but you do have to be prepared to work hard.

When I set out to create this process, I decided to push it uphill. Not to make it easier or faster, but to make it more difficult, to have it take longer. Not to make it more digital and scalable, but to make it more handmade and require a smaller scale. Mostly, not to let people off the hook, but to create a process that would help a few people transform themselves.

This $3,000 workshop is for people who want to move up to leadership in their current organization, accelerate their indie projects and take control over their agenda. It's designed to be the most significant lever for change we could create. This is our third session, and I can say with confidence that it's working.

You have far more potential than people realize. You have something to say, a mission to go on, a contribution that matters. I'd like to help you unlock that potential.

If you know someone who needs this sort of opportunity, I hope you'll share it with them.

There are {15} days left to apply. I'll post {reminders} now and then over the next two weeks. I hope you'll get a chance to check it out, but even if you don't apply, go ahead and use this moment, right now, to make a choice.

Level up.

• Email to a friend •

miercuri, 30 septembrie 2015

Mish's Global Economic Trend Analysis

Obama's "Model for US" Plant Moves to Canada; Mish's Model vs. Obama's Model
CPI and HICP Deflation in Spain Accelerates
What if a Tumor Stole Your Memories? Then Years Later, Surgery Restored Those Memories?
Chicago PMI Unexpectedly Dives to Negative Territory; Production at Lowest Since July 2009; Emanuel's Tax Hikes Will Make Matters Worse

Obama's "Model for US" Plant Moves to Canada; Mish's Model vs. Obama's Model

Posted: 30 Sep 2015 09:09 PM PDT

Last year, president Obama visited GE's 106-year-old Waukesha, Wisconsin plant.

At the plant, GE builds large piston engines for power and oilfield use that run on natural gas or methane from landfills.

President Obama called the plant "a model for the country."

This week, GE announced that it will move production to Canada. The move will cost the US 350 manufacturing jobs.

Is Obama's "model" the correct one for the US?

Placing the Blame
Some place the blame for the Manufacturing Move on export financing.

In its latest salvo aimed at persuading Congress to renew the U.S. Export-Import Bank's charter which expired in June, GE will invest $265 million in a new state-of-the-art manufacturing plant at a Canadian location yet to be determined.

In exchange for moving the production from Waukesha, Wisconsin, Export Development Canada will provide financing support for a range of future products, including some still made in the United States.

The announcement stands in sharp contrast to a 2014 visit to the site by President Barack Obama, in which he touted its worker training program as "a model for the country."

"I'd say the workers at Waukesha are the real world casualties in the right-wing fight to close the EXIM Bank," said Frank Larkin, a spokesman for the International Association of Machinists, which represents plant workers.

In recent weeks, GE has announced several deals to locate thousands of new jobs out of the United States following EXIM's closure and to access government export credit from the United Kingdom, France, Hungary and China.

GE Vice Chairman John Rice told Reuters that foreign export credit agencies are "rolling out the red carpet" for the industrial conglomerate, more than tripling the export financing capacity it received under EXIM.

GE Debunks EXIM Theory

GE says those engines are not typically sold with EXIM financing, so let's look elsewhere for the reason. What about the dollar?

Canadian Dollar 2003-2015 Round Trip

The Canadian dollar, frequently referred to as the "Loonie" because of a loon image on a coin, recently had as much as a 10% premium to the dollar. Now the Loonie rests with a 25% discount to the dollar.

Corporate Income Tax to Blame?

Republican Representative James Sensenbrenner, who represents Waukesha and opposes EXIM "in its current form," said in a statement that the manufacturing move was a "sober reminder of the urgent need to stay competitive in the global marketplace" and called for lower corporate tax rates.

GE Pays No Corporate Income Tax

Amusingly, 15 Fortune 500 companies paid no federal income tax on $23 billion in profits in 2014, and they paid almost no federal income tax on $107 billion in profits during the past five years.

Yep, GE was one of those companies.

CBS, General Electric, Interpublic Group, JetBlue Airways, Mattel, Owens Corning, PG&E, Pepco Holdings, Priceline.com, Prudential Financial, Qualcomm, Ryder System, Time Warner, Weyerhaeuser and Xerox all paid no corporate income tax because they move operations and manufacturing to places where foreign income tax collection is low and export tax credits high.

Can corporate income tax be a problem when GE paid none?

Actually, yes.

Right now, the US practically begs corporations to move overseas via high tax rates coupled with numerous foreign loopholes including deferred taxes on investments and profits overseas. Every few years, Congress floats a "repatriation" tax holiday in which businesses bring the cash back to the US tax free.

Mish's Model vs. Obama's Model

Rather than close loopholes like president Obama proposes, I have a better idea: Set the corporate income tax to a flat 0% in the US and something above 0% on US corporate production and profits outside the US.

Watch the jobs come back home in a jiffy.

On a smaller scale, Illinois needs to learn the same lesson. For discussion of the sorry state of Illinois, please see ...

Mike "Mish" Shedlock

CPI and HICP Deflation in Spain Accelerates

Posted: 30 Sep 2015 03:54 PM PDT

After a brief 0.1% rise in inflation in June and July, Spain's National Statistics Institute (INE) estimates the CPI stands at ‒0.9% in September, five tenths lower than that registered in August.

The above is a "flash" reading.

The INE reports Spain's HICP (Harmonised Index of Consumer Prices) a measure that normalizes Spain with the rest of Europe "stands at ‒1.2% [year-over-year]. If confirmed, the annual change of the HICP would have decreased seven tenths as compared to the previous month.".

Spain is Europe's fastest growing economy, but ECB president Mario Draghi is hell-bent on putting an end to deflation.

Of course, we are talking about price deflation, not monetary deflation, not asset bubble deflation, not credit deflation. Central banks and economists alike would be best off not caring one bit about routine price deflation.

Mike "Mish" Shedlock

What if a Tumor Stole Your Memories? Then Years Later, Surgery Restored Those Memories?

Posted: 30 Sep 2015 12:03 PM PDT

I just received a fascinating email today from Demetri Kofinas, Executive Producer of Offline Productions.

Because of a brain tumor, Kofinas went years not knowing what he was saying, where he had been, or what he was doing. For example, he might have said Barack Obama in a sentence when he really meant American actor and filmmaker Denzel Washington.

The condition grew worse over time. New York state and Boston the city could easily be the same, or even reversed on a map. He lost most of his friends as it appeared to them he was on some wildly powerful drugs.

He could not remember anything he was doing or even why he was there. The memories were stored somewhere in his brain, but he could not process information correctly at the moment, nor retrieve those memories later.

Following brain surgery, he was immediately coherent. Over the next few weeks and months all his lost memories came back.

For the whole story, please see Demetri Kofinas' article A tumor stole every memory I had. This is what happened when it all came back.

Those living in New York, may wish to see Twelfth Night, Offline Productions' rendition of a Shakespearean classic.

Mike "Mish" Shedlock

Chicago PMI Unexpectedly Dives to Negative Territory; Production at Lowest Since July 2009; Emanuel's Tax Hikes Will Make Matters Worse

Posted: 30 Sep 2015 10:42 AM PDT

The Chicago PMI is in negative territory, plunging to 48.7 from a prior reading of 54.4 and a Bloomberg Consensus Estimate of 53.6.

Giant swings are common enough for the Chicago PMI which collapsed nearly 6 points in September to a sub-50 reading of 48.7. This indicates slight monthly contraction in the Chicago region's composite activity.

New orders are below 50 as are backlog orders, the latter for an 8th straight month. Chicago-area businesses can't rely on backlogs as much to keep up production which is also under 50 and at a 6-year low. Contraction in prices is deepening.

Recent History Of This Indicator

The Chicago PMI is expected to slow to 53.6 in September from 54.4 in August when delays in shipments gave the index a lift.

Production Plummets to Lowest Since July 2009

Digging into to the Chicago PMI report we note Production Plummets to Lowest Since July 2009.

The Chicago Business Barometer declined 5.7 points to 48.7 in September as Production growth collapsed and New Orders fell sharply. The drop in the Barometer to below 50 was its fifth time in contraction this year and comes amid downgrades to global economic growth and intense volatility in financial markets which have slowed activity in some industries. The latest decline followed two months of moderate expansion, and while growth in Q3 accelerated a little from Q2, the speed of the September descent is a source of concern.

Three of the five components of the Barometer were in contraction in September with only Employment and Supplier Deliveries above the 50 neutral level. Production led the decline with a sharp double-digit drop that placed it at the lowest since July 2009. New Orders also fell significantly and both key activity measures are running well below their historical averages.

Economist's Comment

Chief Economist of MNI Indicators Philip Uglow said, "While activity between Q2 and Q3 actually picked up, the scale of the downturn in September following the recent global financial fallout is concerning. Disinflationary pressures intensified and output was down very sharply. We await the October data to better judge whether this was a knee jerk reaction and there is a bounceback, or whether it represents a more fundamental slowdown."

Get Me the Hell Out of Here

There is no need to wait to October to understand the trend. A fundamental slowdown is pretty obvious. Illinois and Chicago in particular have huge issues.

Illinois manufacturers are voting with their feet. As noted on August 13, in Get Me the Hell Out of Here ...

Manufacturers in Illinois have had it with tax hikes after tax hikes coupled with the most costly workers' compensation setup in the nation. And businesses are voting with their feet. In July, five firms left Illinois for good. A sixth, Hoist Liftruck, a manufacturer of industrial forklifts, announced plans in August to move more than 300 manufacturing jobs from Bedford Park, Illinois, to East Chicago, Indiana.

I wonder how the economists all missed the slowdown. What the heck are they watching? Or are they still listening to Janet Yellen who insists this is all "transitory"?

Tax Hikes Not The Answer

Tax hikes in the midst of a slump are precisely the wrong thing to do.

Yet, a week ago, Chicago Mayor Rahm Emanuel announced the largest tax hike in history. For details, please see Chicago Tax Collector Hath Arrived With Massive Tax Hike: Emanuel Says "No Stone Unturned ... Not Done Yet".

It will not be just businesses fleeing Illinois, mobile taxpayers will leave as well. And in fact they already have.

As noted by Michael Lucci, Vice President at the Illinois Policy Institute, Food Stamp Growth Outpaces Illinois Job Creation 5-4 During Recovery.

Illinois Food Stamp Usage vs. Jobs

During the recovery from the Great Recession, the Land of Lincoln, alone in the Midwest, had more people enter the food-stamps program than start jobs. Food-stamps growth in Illinois has outpaced jobs creation by a 5-4 margin.

During the recovery, Illinois put more people on food stamps than every other Midwestern state combined.

And After losing 117,000 manufacturing jobs during the recession, Illinois has only regained 17,400 of those factory jobs since January 2010.

Meanwhile, the other Great Lakes states have pulled far ahead of Illinois during the recovery. Michigan has added 135,600 manufacturing jobs, Indiana has added 80,400, Ohio has added 74,500 and Wisconsin has added 48,700.

Illinois Plans to Make Matters Worse

Illinois sheds manufacturing jobs and gains food stamp recipients. High taxes, a very poor business climate, especially Worker's Compensation procedures, are precisely to blame. So is inadequate pension funding and untenable pension promises.

Illinois needs reform, especially on pensions and a slew of business climate changes. Yet Emanuel and the "progressives" think higher taxes and higher food stamp benefits are the solution.

Rather than fix fundamental problems in the public union sector, Emanuel plans to leave no stone unturned when looking for additional revenue. What more do businesses in the Chicago area need to hear to decide to leave?

Six corporations left in July and August, yet economists are surprised by the plunge in activity.

Millennials will bear the brunt of these poor decisions. So I ask, Question to Millennials: Why Are You Not Mad as Hell Yet?

Mike "Mish" Shedlock