Links: 2013-11-04
Twitter’s outlook for long-term profitability still looks questionable – Telegraph
“To value Twitter at $11.1bn (£6.9bn) despite the company never making a profit looks like madness, but there is some method behind that number. Companies that have yet to make a profit are valued on a multiple of their revenue.
The social networking company is expected to make $583m in 2013, and just shy of $1bn in revenue for 2014. That means the valuation is a multiple of 11 times projected revenue. Facebook went public at a value of $100 billion – 20 times its 2012 revenue – while LinkedIn launched at an even higher multiple. “
Investors backing Twitter to double in value on float day – Telegraph
“Retail investors have bet millions of pounds that Twitter’s market valuation doubles after the first day of trading on the New York Stock Exchange this week. “
JD Power Explains Why Samsung Beat Apple In Its Latest Tablet Study: Price | TechCrunch
The NYT’s paywall overtakes digital ads : Columbia Journalism Review
ISM – Media Release: October 2013 Manufacturing ISM Report On Business®
Great numbers: PMI at 56.4, new orders at 60.6. Though Production down a bit at 60.8 and same with employment.
Rob Ford: Toronto finally knows the truth | Toronto Star
BBC News – China’s manufacturing activity at 18-month high
Notice that the PMI is only 51.4. So, this may be the best in 18 months but it still isn’t that great.
Trickle-down economics — total horseshit | LARS P. SYLL
The last sentence spells it out very well. That’s Latin American-style democracy coming to the US.
“An economy in which most citizens are doing worse year after year—an economy like America’s—is not likely to do well over the long haul … Perhaps most important, a modern economy requires “collective action”—it needs government to invest in infrastructure, education, and technology … The more divided a society becomes in terms of wealth, the more reluctant the wealthy become to spend money on common needs.”
Yikes! Mexico Q3 GDP growth slows to 1% | beyondbrics
“the economy saw first quarter growth of 0.8 per cent; a second quarter contraction of 0.7 per cent, and now third quarter growth of 1 per cent.
To achieve the full-year forecast of 1.7 per cent, which Ernesto Revilla, a senior finance secretariat official, says the government is not changing yet (despite market analysts downgrading theirs – in some cases to little over 1 per cent), the economy would need to grow something like 3.8 per cent in the fourth quarter. A long shot.”
Manufacturing PMI slightly down at 47.3 in October | Macropolis
“Greek Manufacturing PMI slightly eased to 47.3 in October from 47.5 in September, falling further from the 44-month high of 48.7 in August, according to Markit.
Unlike the past two releases, the October reading, posting back-to-back falls for the first time since early 2012, suggests a return to growth in the manufacturing sector is unlikely this year.”
ekathimerini.com | Greece: NPLs swell to 65 bln euros, says PwC report
Greek Recovery Makes Stocks World’s Best as Paulson Buys – Bloomberg
“Since June 5, 2012, two weeks before MSCI Inc. gave notice it may reclassify Greece as an emerging market, the country’s ASE Index (ASE) has surged 146 percent, trimming the decline from its 2007 peak to 79 percent. The gains topped all 94 national benchmarks globally in the period, except Venezuela, according to data compiled by Bloomberg. Yields on Greece’s 10-year government bonds have dropped to 8.31 percent from a peak of 33.7 percent in March 2012. “
ekathimerini.com | Greek retail sales drop 7.8 pct y/y in August
“Retail sales by volume fell 7.8 percent year-on-year after a slightly revised 13.9 percent annual drop in July.
Retail sales slumped by an average annual pace of 10 percent between January and August, only slightly below its 12 percent drop in the full year of 2012. The sector has shrunk by 34 percent in 2009-2012. “
The collapse of US infrastructure spending, charted | FT Alphaville
Google officially unveils the LG Nexus 5 | Android and Me
Bubbles and the broth | Business | theguardian.com
Nouriel Roubini notes the aggressive nature of monetary policy is countered by little in terms of growth despite the risk of asset bubbles. It puts monetary policy makers in a difficult predicament.
Germany Hits Back at U.S. Over Economic Criticism – WSJ.com
“”The trade surpluses reflect the strong competitiveness of the German economy and the international demand for quality products from Germany,” the German Economics Ministry said in a statement Thursday, responding to a report from the U.S. Treasury published Wednesday that bluntly criticized Germany’s economic policies and blamed the euro-zone powerhouse for dragging down its neighbors and the rest of the global economy.
“The U.S. government should critically analyze its own economic situation,” said Michael Meister, a senior lawmaker and close ally of Chancellor Angela Merkel, criticizing the high debt level in the U.S., which “doesn’t just unsettle [the U.S.], but has negative effects on the global economy.””
“Strategy Analytics claims Google-powered smartphones took 81% market share in the third quarter, but Windows Phone was fastest growing OS”
Germany Defends Trade Surplus After Critical US Treasury Report – SPIEGEL ONLINE
Isn’t this what one should have expected?:
“Germany Seethes at US Economic Criticism
German policymakers are striking back at the United States, after a US Treasury report blasted the country’s massive trade surplus. Sensitivities in Berlin are still high over US spying on Chancellor Angela Merkel.”
Chained CPI Versus the Standard CPI: Breaking Down the Numbers
What If Chained CPI Had Been Used to Calculate COLAs Since 2002?
“in 2013, our hypothetical Chained CPI COLA recipient would be receiving about 3.3% less than today’s actual payout. In our above illustration, that’s about $45 less per month, which would buy a fair amount of groceries for a frugal shopper at Wal-Mart.”
Economic effect from food stamp cuts may be as high as $10B
“Programs such as SNAP have what economists call a “multiplier effect”—in other words, a dollar given to an entitlement recipient has amplified economic benefits. In this case, those consist primarily of the grocers who benefit when food stamp users shop in their stores. The estimated multiplier effect for food stamps is as high as 2 to 1. “
Calculated Risk: Chicago PMI increases sharply to 65.9
This was a big beat that shows the economy in this area of the US doing well.
U.S. Crime Is Up, but Americans Don’t Seem to Have Noticed
“The U.S. Bureau of Justice Statistics recently released its crime figures for 2012, showing the rate of violent crimes in the U.S. increasing for the second consecutive year. Victimizations per thousand rose from 19 in 2010 to 23 in 2011 and 26 in 2012. Nevertheless, slightly fewer Americans today than in 2011 — 64% vs. 68% — believe crime in general is up over a year ago.”
The New Republican Civil War | TIME.com
GOP Governors Call for Party Redirection, New Focus On Less Fortunate | TIME.com
See the oiece on food stamp cuts. These two contradict each other. So there is work to be done on a coherent strategy.
Food Stamp Cuts Kick in as Congress Debates More | TIME.com
Yet more fiscal drag that will cut US GDP growth.
“More than 47 million Americans who receive food stamps will see their benefits go down starting Friday, just as Congress has begun negotiations on further cuts to the program.
Beginning in November, a temporary benefit from the 2009 economic stimulus that boosts food stamp dollars will no longer be available. According to the Agriculture Department, that means a family of four receiving food stamps will start receiving $36 less a month.”
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