Bill Bonner [Reckoning on January 29, 2010 from Paris, France]
Science and technology have produced many wondrous breakthroughs. But there are some things it cannot improve. A kiss from natural lips is still the lover's choice. Baby formula proved no match for the real thing. Ersatz money is a flop too. That last item is not so much a fact as a prediction.
The first modern competition between gold and paper money ended like the pre-modern ones. Gold won. Herewith, a short summary:
A rogue, John Law, was the protagonist of the story. He killed Beau Wilson in a duel. Then, he went on the lam...first to Scotland...then to Amsterdam...and finally to Paris. Like Alan Greenspan or Ben Bernanke, he made himself useful to people in high places - in this case the Duke d'Orleans, who needed money. Law had a way to get it:
"I have discovered the secret of the philosophers' stone," he is said to have remarked, "it is to make gold out of paper."
We need to look no further. Law may have been good with figures; it was at philosophy that he failed. A thing cannot be both one thing and a different thing at the same time. It is either gold. Or it is paper. Rarity and durability give gold value - as money. Paper's most conspicuous properties are just the opposite - it is common...and has a tendency to curl up and blow away.
Law's new, easy money helped France to an economic recovery - or so it seemed. But in the end, the philosophical error caught up with him. Gold has real value. If you can create it at will, why not create more of it? It was just a matter of time before he had created too much. Soon, there was an angry mob outside Law's office on the Rue Quincampoix. People who held his paper gold had come to see it in a different light. Where once they cherished it as paper gold...now they despised it as nothing but paper.
Law's scheme increased France's money supply - including banknotes and shares in his Mississippi company - by 300%. Prices in Paris doubled between 1718 and 1720. Then, when the new money system began to give way, the Duke d'Orleans "cranked up the printing press." By 1721, Law's money was worthless. "Banque" was a dirty word in France for the next 200 years.
The current experiment with paper money began on the 15th of August 1971. Henceforth, said Richard Nixon, foreign countries that wished to exercise their right to trade US dollars for gold could drop dead. From that point forward, the dollar was worth only what someone would give you for it. Philosophers held their breath. But nothing happened. Many have died since, waiting for the dollar to succumb first. Still, the millstones of monetary history may grind slowly, but the more slowly they grind, the more fingers they pinch.
The new paper money standard allowed for a worldwide credit boom - just as in Paris following the establishment of Law's scheme. The US created dollars. Its citizens spent them. The dollars accumulated as reserves all over the world...and every central bank raced to keep up. Soon, the exporters were producing too much. The importers were consuming too much. And there was too much money and credit everywhere.
The Japanese economy was the first to blow up - in 1989. The tech sector on Wall Street was next to go - in 1999. Finally, in 2007, the planet-wide bubble popped. Suddenly, the whole world was Japan. And now, every nation in Christendom, to say nothing of the others, is following Law's example. All issue paper gold - in the form of bills, notes, and bonds - as if they were the Banque Royale. Europe is estimated to need $2.2 trillion in deficit funding this year. America will need at least a trillion more. If the depression deepens, maybe $2 trillion. How long can this go on? Where will it lead?
"There are no means of avoiding the final collapse of a boom brought about by credit expansion," wrote Ludwig von Mises. "The alternative is only whether the crisis should come sooner as a result of voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved."
On Tuesday, the S&P rating agency issued a warning. If Japan continues in the direction it is going, it will have Hell to pay. Japan leads the way into the future. And into a monetary minefield. Her current deficit - a record - is more than her tax revenue. And her public debt is nearly 7 times as great. Her feet grow larger.
No natural life survives the lifecycle. And no paper currency standard has ever survived a complete credit cycle. It is just a matter of time until we hear the explosion and see body parts flying.
Regards,
Bill Bonner,
for The Daily Reckoning
Joel's Note: Addison tells us they're putting the final touches on a collection of Bill's various reckonings from over the past decade, titled "Dice Have No Memory: Big Bets and Bad Faith from Paris to the Pampas." At this stage, we're looking at a March release. Keep a look out for it.
Saturday, December 25, 2010
Thursday, December 23, 2010
The Religion of Consumerism: Continuing a holiday tradition, even if it’s fiscally imprudent
Joel Bowman
From Buenos Aires, Argentina...
Cricket in the park...beers in the sun...outdoor cafes and pretty girls in summer dresses. We're getting an early jump on the holiday season here at The Daily Reckoning...at least so far as it's conducted south of the equator.
Last year your editor celebrated the occasion with Buddhist friends in the Far East. The year before, with Hindus in Mumbai. And before that, with Muslims in the Middle East. This weekend, we'll have Catholic buddies around for an Argentine asado. We'll drink Malbec and yerba maté and listen to Carlos Gardel belt out some old classics from the rooftop terrace.
That's the wonderful thing about the holiday season. It's a time of year when people of all faiths set aside their differences to worship a common higher purpose: the religion of consumerism. Flocks of all colors and creeds make their annual pilgrimages to consumerism's many temples - sometimes known as "malls" - to prostrate themselves at the discount aisle and to sacrifice the balance of their credit cards. Indeed, people who don't even believe in Jesus Christ or the virgin birth can still be found queuing up for two-for-one tie sales and half- off kitchen appliance clearances. We remember reading somewhere, a highly regarded scientific journal perhaps, that the sound of the collective global credit card swipe around this time of year is audible even in the outer reaches of space.
"But wait a minute," we hear some Fellow Reckoners complain. "Isn't this precisely how we arrived in this mess in the first place? By overspending on junk we didn't need and couldn't afford? Shouldn't we be paying down our debts and practicing some fiscal responsibility?"
Oh bah humbug! Don't be such a Grinch! Nobody likes a stickler for inconvenient facts while the eggnog is still flowing.
Besides, Christmas isn't about spending money we don't have on things we don't need...it's about spending money we don't have on things other people don't need. The net effect might be the same, but at least the soundtrack to financial ruin is a feel-good one.
Christmas is also a time to gather with friends and family and to reflect on the year gone by. Who got married? Who graduated? Which currency narrowly escaped collapse? That sort of thing.
With that in mind, we present the first installment of our 2010 Daily Reckoning "Best Of" Series. Your editors sifted through both the column archives and the reader mail to come up with a selection of essays that, we hope, provide you with some interesting discussion topics for your holiday season family gatherings.
First, let's go back to the beginning...
Way back in January, Bill Bonner penned the following essay, a kind of "ghost of currencies past," if you will. Please enjoy and send your comments to the address below...
Additional articles and commentary from The Daily Reckoning on:
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If you are you having trouble receiving your Daily Reckoning subscription, you can ensure its arrival in your mailbox by whitelisting the Daily Reckoning.
© 2010-2011 Agora Financial, LLC. All Rights Reserved. Protected by copyright laws of the United States and international treaties. This newsletter may only be used pursuant to the subscription agreement and any reproduction, copying, or redistribution (electronic or otherwise, including on the World Wide Web), in whole or in part, is strictly prohibited without the express written permission of Agora Financial, LLC. 808 Saint Paul Street, Baltimore MD 21202. Nothing in this e-mail should be considered personalized investment advice. A lthough our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized investment advice.We expressly forbid our writers from having a financial int erest in any security recommended to our readers. All of our employees and agents must wait 24 hours after on-line publication or 72 hours after the mailing of a printed-only publication prior to following an initial recommendation.Any investments recommended in this letter should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company.
From Buenos Aires, Argentina...
Cricket in the park...beers in the sun...outdoor cafes and pretty girls in summer dresses. We're getting an early jump on the holiday season here at The Daily Reckoning...at least so far as it's conducted south of the equator.
Last year your editor celebrated the occasion with Buddhist friends in the Far East. The year before, with Hindus in Mumbai. And before that, with Muslims in the Middle East. This weekend, we'll have Catholic buddies around for an Argentine asado. We'll drink Malbec and yerba maté and listen to Carlos Gardel belt out some old classics from the rooftop terrace.
That's the wonderful thing about the holiday season. It's a time of year when people of all faiths set aside their differences to worship a common higher purpose: the religion of consumerism. Flocks of all colors and creeds make their annual pilgrimages to consumerism's many temples - sometimes known as "malls" - to prostrate themselves at the discount aisle and to sacrifice the balance of their credit cards. Indeed, people who don't even believe in Jesus Christ or the virgin birth can still be found queuing up for two-for-one tie sales and half- off kitchen appliance clearances. We remember reading somewhere, a highly regarded scientific journal perhaps, that the sound of the collective global credit card swipe around this time of year is audible even in the outer reaches of space.
"But wait a minute," we hear some Fellow Reckoners complain. "Isn't this precisely how we arrived in this mess in the first place? By overspending on junk we didn't need and couldn't afford? Shouldn't we be paying down our debts and practicing some fiscal responsibility?"
Oh bah humbug! Don't be such a Grinch! Nobody likes a stickler for inconvenient facts while the eggnog is still flowing.
Besides, Christmas isn't about spending money we don't have on things we don't need...it's about spending money we don't have on things other people don't need. The net effect might be the same, but at least the soundtrack to financial ruin is a feel-good one.
Christmas is also a time to gather with friends and family and to reflect on the year gone by. Who got married? Who graduated? Which currency narrowly escaped collapse? That sort of thing.
With that in mind, we present the first installment of our 2010 Daily Reckoning "Best Of" Series. Your editors sifted through both the column archives and the reader mail to come up with a selection of essays that, we hope, provide you with some interesting discussion topics for your holiday season family gatherings.
First, let's go back to the beginning...
Way back in January, Bill Bonner penned the following essay, a kind of "ghost of currencies past," if you will. Please enjoy and send your comments to the address below...
Additional articles and commentary from The Daily Reckoning on:
Twitter Facebook DR iPhone APP
If you are you having trouble receiving your Daily Reckoning subscription, you can ensure its arrival in your mailbox by whitelisting the Daily Reckoning.
© 2010-2011 Agora Financial, LLC. All Rights Reserved. Protected by copyright laws of the United States and international treaties. This newsletter may only be used pursuant to the subscription agreement and any reproduction, copying, or redistribution (electronic or otherwise, including on the World Wide Web), in whole or in part, is strictly prohibited without the express written permission of Agora Financial, LLC. 808 Saint Paul Street, Baltimore MD 21202. Nothing in this e-mail should be considered personalized investment advice. A lthough our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized investment advice.We expressly forbid our writers from having a financial int erest in any security recommended to our readers. All of our employees and agents must wait 24 hours after on-line publication or 72 hours after the mailing of a printed-only publication prior to following an initial recommendation.Any investments recommended in this letter should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company.
Friday, December 17, 2010
Delusions of Power: The Effects of Central Banking on Gold and Paper Currencies
Reporting from Laguna Beach, California...by Eric Fry
"When will the gold bubble burst?" CNBC's Larry Kudlow wondered aloud this morning.
A question to which your California editor would reply, "We know what gold is and we know what a financial bubble is, but we don't see any gold bubbles."
Perhaps Kudlow is referring to the fact that the gold price is rising...in response to the Central Banking Bubble. On its face, the idea is ludicrous that one man can steer an entire economy, simply by adjusting one little interest rate. The idea is a doubly ludicrous that one institution can nurture economic growth, simply by printing money. And yet, a nation of investors places its faith in the Cult of Central Banking, as folks like Larry Kudlow pay homage to Ben Bernanke every business day.
So far, the true believers have profited from their faith. It has paid well to embrace this cult and to trust the Delphic utterances of its high priests like Alan Greenspan and Ben Bernanke. But this whole central bank thing is getting a little out of hand.
The early central bankers admitted their fallibility. They would adjust interest rates up or down, depending on the prevailing economic circumstances, then hope for the best. But the more that the central bankers' tinkering and meddling appeared to succeed, the more they tinkered and meddled, and the more they believed in the power of their tinkering and meddling.
Eventually, the central bankers not only believed in the power of their intrusions and manipulations, but also in the wisdom of them. Before long, the central bankers considered their activities to be not merely a responsibility, but an imperative, a social duty; perhaps even a "calling" - a kind of Divine Right of Central Banking.
Armed with these potent delusions, central bankers around the world continue to meddle, day by day, month by month. And the investor-flock continues to trust in their mystical powers. This nearly universal faith in a priesthood of monetary medicine men is an extreme idea...taken to an extreme. It is a bubble - the effects of which are as varied as they are non-quantifiable. But one effect is very clear: currency values are perpetually in decline.
The more the medicine men prescribe their remedies and elixirs, the faster the purchasing power of their paper currencies erodes. Observing this trend, rational, forward-looking investors scout around for assets the central bankers are not trying to protect - assets that require no protection whatsoever. Gold is an obvious choice. It is the timeless choice of all investors who reject the Cult of Central Banking and who, therefore, distrust paper currencies as a store of value.
Gold is rising because Central Banking is in a bubble. But the gold bubble, itself, will not arrive until the Central Banking Bubble bursts - the moment when investors universally spurn the cult of Central banking as heresy, and rebuke central bankers, themselves, as agents of wealth destruction. At that moment, when gold is trading north of $10,000 an ounce...or $20,000...or $100,000, the gold bubble will have arrived. And when it does, we will be there to issue a "sell" recommendation.
Speaking of "sell" recommendations, Jay Shartsis, a seasoned options pro at R.F. Lafferty in Lower Manhattan, warned his clients on Wednesday, "A big stock market decline is coming."
To support his bearish call, Shartsis has highlighted a variety of market signals and sentiment indicators. Late last week, for example, Shartsis noted that the "CBOE equity put/call ratio hit .27 - the lowest in my memory. And now 8 days in a row, this ratio has been sitting below .60 - that's a sell signal."
Then earlier this week, Shartsis observed, "With the stock market near the highs for this move, there are only 127 new highs on the NYSE and 88 new lows. The new lows number is way above where it would be if this market was in good underlying shape. Yesterday saw 3% of all NYSE stocks at new lows - a condition that has happened only 36 times in the past. Two months afterwards, the S&P 500 was lower on 32 of those 36 instances."
Lastly, Shartsis called attention to the nearby chart, as he remarked, "The chart displays the Options Speculation Index. It is a measure of total call buys plus put sales (those are bullish transactions), divided by total put buys plus call sales (bearish transactions). So this is a very comprehensive gauge and it now reflects the most bullish option trader sentiment probably ever recorded. No fear at all. Note that the index is considerably higher than it was before the flash crash last May. A big market decline is coming!"
Shartsis has been wrong before, of course. But he has also been right. We predict he will be one of the two this time around.
"When will the gold bubble burst?" CNBC's Larry Kudlow wondered aloud this morning.
A question to which your California editor would reply, "We know what gold is and we know what a financial bubble is, but we don't see any gold bubbles."
Perhaps Kudlow is referring to the fact that the gold price is rising...in response to the Central Banking Bubble. On its face, the idea is ludicrous that one man can steer an entire economy, simply by adjusting one little interest rate. The idea is a doubly ludicrous that one institution can nurture economic growth, simply by printing money. And yet, a nation of investors places its faith in the Cult of Central Banking, as folks like Larry Kudlow pay homage to Ben Bernanke every business day.
So far, the true believers have profited from their faith. It has paid well to embrace this cult and to trust the Delphic utterances of its high priests like Alan Greenspan and Ben Bernanke. But this whole central bank thing is getting a little out of hand.
The early central bankers admitted their fallibility. They would adjust interest rates up or down, depending on the prevailing economic circumstances, then hope for the best. But the more that the central bankers' tinkering and meddling appeared to succeed, the more they tinkered and meddled, and the more they believed in the power of their tinkering and meddling.
Eventually, the central bankers not only believed in the power of their intrusions and manipulations, but also in the wisdom of them. Before long, the central bankers considered their activities to be not merely a responsibility, but an imperative, a social duty; perhaps even a "calling" - a kind of Divine Right of Central Banking.
Armed with these potent delusions, central bankers around the world continue to meddle, day by day, month by month. And the investor-flock continues to trust in their mystical powers. This nearly universal faith in a priesthood of monetary medicine men is an extreme idea...taken to an extreme. It is a bubble - the effects of which are as varied as they are non-quantifiable. But one effect is very clear: currency values are perpetually in decline.
The more the medicine men prescribe their remedies and elixirs, the faster the purchasing power of their paper currencies erodes. Observing this trend, rational, forward-looking investors scout around for assets the central bankers are not trying to protect - assets that require no protection whatsoever. Gold is an obvious choice. It is the timeless choice of all investors who reject the Cult of Central Banking and who, therefore, distrust paper currencies as a store of value.
Gold is rising because Central Banking is in a bubble. But the gold bubble, itself, will not arrive until the Central Banking Bubble bursts - the moment when investors universally spurn the cult of Central banking as heresy, and rebuke central bankers, themselves, as agents of wealth destruction. At that moment, when gold is trading north of $10,000 an ounce...or $20,000...or $100,000, the gold bubble will have arrived. And when it does, we will be there to issue a "sell" recommendation.
Speaking of "sell" recommendations, Jay Shartsis, a seasoned options pro at R.F. Lafferty in Lower Manhattan, warned his clients on Wednesday, "A big stock market decline is coming."
To support his bearish call, Shartsis has highlighted a variety of market signals and sentiment indicators. Late last week, for example, Shartsis noted that the "CBOE equity put/call ratio hit .27 - the lowest in my memory. And now 8 days in a row, this ratio has been sitting below .60 - that's a sell signal."
Then earlier this week, Shartsis observed, "With the stock market near the highs for this move, there are only 127 new highs on the NYSE and 88 new lows. The new lows number is way above where it would be if this market was in good underlying shape. Yesterday saw 3% of all NYSE stocks at new lows - a condition that has happened only 36 times in the past. Two months afterwards, the S&P 500 was lower on 32 of those 36 instances."
Lastly, Shartsis called attention to the nearby chart, as he remarked, "The chart displays the Options Speculation Index. It is a measure of total call buys plus put sales (those are bullish transactions), divided by total put buys plus call sales (bearish transactions). So this is a very comprehensive gauge and it now reflects the most bullish option trader sentiment probably ever recorded. No fear at all. Note that the index is considerably higher than it was before the flash crash last May. A big market decline is coming!"
Shartsis has been wrong before, of course. But he has also been right. We predict he will be one of the two this time around.
Wednesday, December 8, 2010
Where the Jobs Went
Whiskey & Gunpowder By Henry Daniels
December 8, 2010
Los Angeles, California, U.S.A.
As we head into the Holidays, with no signs that things are ever going to get better, some news was recently released that casts an interesting, and gloomy, light on why there are no jobs.
If there is one common theme I’ve heard from friends who still have jobs over the last two years, it’s that they are working harder than ever and making the same or less than they used to. Personally, I’m self-employed, and while I work 15 to 20 hour days, seven days a week, it hasn’t been in vain; the last two years have been my best ever.
Today, I heard a report on corporate profits and amazingly (or not) the quarter has been the most profitable in corporate history since they started keeping records on such things over 60 years ago.
The math is simple. If a corporation can get by with 50 to 65 percent fewer employees while holding production steady, they will make a lot more money. So what if people have to work two or three times harder than they did a few years ago? If they don’t like it, there are ten people standing in line to take their place.
This means there’s no incentive for corporations to hire. None. At least not until one of three watershed events occur.
The first watershed will be when the workers productivity starts to falter. The truth is that the only way work is getting done on time these days is because the workers are forced to take shortcuts to meet deadlines and quotas. It is already showing up in the quality of products, things are not made as well or last as long as they did just a few years ago. The failure rate is getting alarming on car parts, computer components, and customer service.
The second watershed event will be when the workers decide they are tired of being exploited, and if anyone else wants their job they’re welcome to it. We will see worker slowdowns similar to those popular in Europe. Suddenly, corporate profits will be jeopardized.
The third watershed event will be when corporations no longer have anyone left to sell to. In other words, if the number of unemployed keeps rising, at some point there will no longer be anyone left to buy things until they get employed again. At this point corporate survival will dictate the need to hire people if only to continue selling their products.
Last week, we talked about how one of our first indications of where things are going would be the Black Friday and Cyber Monday’s sales figures. By all accounts, sales this year were basically flat compared to last year. This argues quite forcibly that status quo is where we are stuck for a while.
My guess is we won’t see new jobs for at least a year, maybe two. There will be no trickle down job creation. It’s going to take something more visceral to stimulate job creation.
We’ve become a nation fixated on short-term quotas while we ignore the long-term consequences of such actions. I’ve never held that to be a way to run anything: not your life, not your personal finances, not corporate policy.
Regards,
Henry Daniels
~~~~~~~~~~~~~~~~External Advertisement~~~~~~~~~~~~~~~~
There’s a brilliant documentary entitled “The Fall of America and the Western World.” It not only predicted this mess we’re in, it offers real-world solutions that will enable you to survive the grim future we face.
This hard-hitting, thought-provoking documentary features nine hours of uncensored conversations with Joseph Farah, Naomi Wolf, Doug Casey, Dr. Paul Craig Roberts, professor Mark Crispin Miller, Alex Jones, David Icke, Mickey Z, David McAlvany, Doug McIntyre, G. Edward Griffin and Ken Klein. If you listen to them and follow their advice, you’ll be prepared for whatever lies ahead….
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
First, a correction…
Remember this letter from last time?
“I think you guys are becoming the most left-leaning rag on the net. Get a life or get out if you dislike America. These are some of the [most] leftist-leaning articles I have ever read. Are you guys commies or just deep-seeded socialists?”
Seems we got the guy all wrong. He followed up with an email to express his shock at how I used his letter.
“I thought I clearly stated in the subject line that I was referring to Samantha Buker’s anti-Christian article. If I didn’t, then my mistake. I did like your comments after Black’s article.”
There was truly no indication in the email that the comments were directed at Sam, who sits mere feet away from the Whiskey Bar. The editors at The Daily Reckoning snapped her article before I could. So I wasn’t expecting any heat from it.
Anyway, I promised the reader I’d clear up the confusion.
Now, about those taxes…
“I’m as opposed to the high-end tax cuts today as I’ve been for years. In the long run, we simply can’t afford them.”
— Barack Hussein Obama, 2010
“Gimme yo’ damn money, rich boy!”
— Barack Hussein Obama, 2012
Barack is trying to be polite about it right now, but make no mistake: He fully believes that the more money one makes, the more one should be forking over to people in nice suits who have no idea how to make an honest buck…
And he warns that come 2012, somebody is going to be upping their government tithes… or else…
From The Associated Press:
“‘If we don't get my option through the Senate right now and we do nothing, then on Jan. 1 of this 2011, the average family is going to see their taxes go up about $3,000,’ [Obama] warned.
“‘At any given juncture, there are going to be times where my preferred option, what I'm absolutely positive is right, I can't get done,’ the U.S. president said, stabbing his finger for emphasis.
“‘And so then my question is does it make sense for me to tack a little bit this way or tack a little bit that way because I'm keeping my eye on the long term and the long fight.’”
I got your long fight right here, Barack…
Tax Revolt: The Rebellion Against an Overbearing, Bloated, Arrogant, and Abusive Government
A powerful rallying cry to all Americans to continue to fight against ever-increasing taxes…
By exploring the crippling effects of taxes on our economy and the lives of each individual citizen and drawing from the stories of other revolts, Phil Valentine will anger and incite readers to action, giving them the motivation and know-how to spread the word and activate a powerful new revolution.
At the Whiskey Bar, we’ve never met a tax cut we didn’t like. In the spirit of tax revolt, we’re offering a discount on this book if you order it by clicking here.
It’s normally $24.95, but if you enter in the discount code TAX2011, then you’ll get $5 off. So be sure to order your copy right now.
Regards,
Gary Gibson
Managing Editor, Whiskey & Gunpowder
P.S.: As always, after you get the book, be sure to drop me a line about it: gary@whiskeyandgunpowder.com. We’re moving the Bar into the corner of this very nice bookstore, and there will be a lot of reading to do and a lot to discuss.
December 8, 2010
Los Angeles, California, U.S.A.
As we head into the Holidays, with no signs that things are ever going to get better, some news was recently released that casts an interesting, and gloomy, light on why there are no jobs.
If there is one common theme I’ve heard from friends who still have jobs over the last two years, it’s that they are working harder than ever and making the same or less than they used to. Personally, I’m self-employed, and while I work 15 to 20 hour days, seven days a week, it hasn’t been in vain; the last two years have been my best ever.
Today, I heard a report on corporate profits and amazingly (or not) the quarter has been the most profitable in corporate history since they started keeping records on such things over 60 years ago.
The math is simple. If a corporation can get by with 50 to 65 percent fewer employees while holding production steady, they will make a lot more money. So what if people have to work two or three times harder than they did a few years ago? If they don’t like it, there are ten people standing in line to take their place.
This means there’s no incentive for corporations to hire. None. At least not until one of three watershed events occur.
The first watershed will be when the workers productivity starts to falter. The truth is that the only way work is getting done on time these days is because the workers are forced to take shortcuts to meet deadlines and quotas. It is already showing up in the quality of products, things are not made as well or last as long as they did just a few years ago. The failure rate is getting alarming on car parts, computer components, and customer service.
The second watershed event will be when the workers decide they are tired of being exploited, and if anyone else wants their job they’re welcome to it. We will see worker slowdowns similar to those popular in Europe. Suddenly, corporate profits will be jeopardized.
The third watershed event will be when corporations no longer have anyone left to sell to. In other words, if the number of unemployed keeps rising, at some point there will no longer be anyone left to buy things until they get employed again. At this point corporate survival will dictate the need to hire people if only to continue selling their products.
Last week, we talked about how one of our first indications of where things are going would be the Black Friday and Cyber Monday’s sales figures. By all accounts, sales this year were basically flat compared to last year. This argues quite forcibly that status quo is where we are stuck for a while.
My guess is we won’t see new jobs for at least a year, maybe two. There will be no trickle down job creation. It’s going to take something more visceral to stimulate job creation.
We’ve become a nation fixated on short-term quotas while we ignore the long-term consequences of such actions. I’ve never held that to be a way to run anything: not your life, not your personal finances, not corporate policy.
Regards,
Henry Daniels
~~~~~~~~~~~~~~~~External Advertisement~~~~~~~~~~~~~~~~
There’s a brilliant documentary entitled “The Fall of America and the Western World.” It not only predicted this mess we’re in, it offers real-world solutions that will enable you to survive the grim future we face.
This hard-hitting, thought-provoking documentary features nine hours of uncensored conversations with Joseph Farah, Naomi Wolf, Doug Casey, Dr. Paul Craig Roberts, professor Mark Crispin Miller, Alex Jones, David Icke, Mickey Z, David McAlvany, Doug McIntyre, G. Edward Griffin and Ken Klein. If you listen to them and follow their advice, you’ll be prepared for whatever lies ahead….
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
First, a correction…
Remember this letter from last time?
“I think you guys are becoming the most left-leaning rag on the net. Get a life or get out if you dislike America. These are some of the [most] leftist-leaning articles I have ever read. Are you guys commies or just deep-seeded socialists?”
Seems we got the guy all wrong. He followed up with an email to express his shock at how I used his letter.
“I thought I clearly stated in the subject line that I was referring to Samantha Buker’s anti-Christian article. If I didn’t, then my mistake. I did like your comments after Black’s article.”
There was truly no indication in the email that the comments were directed at Sam, who sits mere feet away from the Whiskey Bar. The editors at The Daily Reckoning snapped her article before I could. So I wasn’t expecting any heat from it.
Anyway, I promised the reader I’d clear up the confusion.
Now, about those taxes…
“I’m as opposed to the high-end tax cuts today as I’ve been for years. In the long run, we simply can’t afford them.”
— Barack Hussein Obama, 2010
“Gimme yo’ damn money, rich boy!”
— Barack Hussein Obama, 2012
Barack is trying to be polite about it right now, but make no mistake: He fully believes that the more money one makes, the more one should be forking over to people in nice suits who have no idea how to make an honest buck…
And he warns that come 2012, somebody is going to be upping their government tithes… or else…
From The Associated Press:
“‘If we don't get my option through the Senate right now and we do nothing, then on Jan. 1 of this 2011, the average family is going to see their taxes go up about $3,000,’ [Obama] warned.
“‘At any given juncture, there are going to be times where my preferred option, what I'm absolutely positive is right, I can't get done,’ the U.S. president said, stabbing his finger for emphasis.
“‘And so then my question is does it make sense for me to tack a little bit this way or tack a little bit that way because I'm keeping my eye on the long term and the long fight.’”
I got your long fight right here, Barack…
Tax Revolt: The Rebellion Against an Overbearing, Bloated, Arrogant, and Abusive Government
A powerful rallying cry to all Americans to continue to fight against ever-increasing taxes…
By exploring the crippling effects of taxes on our economy and the lives of each individual citizen and drawing from the stories of other revolts, Phil Valentine will anger and incite readers to action, giving them the motivation and know-how to spread the word and activate a powerful new revolution.
At the Whiskey Bar, we’ve never met a tax cut we didn’t like. In the spirit of tax revolt, we’re offering a discount on this book if you order it by clicking here.
It’s normally $24.95, but if you enter in the discount code TAX2011, then you’ll get $5 off. So be sure to order your copy right now.
Regards,
Gary Gibson
Managing Editor, Whiskey & Gunpowder
P.S.: As always, after you get the book, be sure to drop me a line about it: gary@whiskeyandgunpowder.com. We’re moving the Bar into the corner of this very nice bookstore, and there will be a lot of reading to do and a lot to discuss.
Evidence for ET is mounting daily, but not proven
By SETH BORENSTEIN.....WASHINGTON — Lately, a handful of new discoveries make it seem more likely that we are not alone — that there is life somewhere else in universe.
In the past several days, scientists have reported there are three times as many stars as they previously thought. Another group of researchers discovered a microbe can live on arsenic, expanding our understanding of how life can thrive under the harshest environments. And earlier this year, astronomers for the first time said they'd found a potentially habitable planet.
"The evidence is just getting stronger and stronger," said Carl Pilcher, director of NASA's Astrobiology Institute, which studies the origins, evolution and possibilities of life in the universe. "I think anybody looking at this evidence is going to say, 'There's got to be life out there.'"
A caveat: Since much of this research is new, scientists are still debating how solid the conclusions are.
Another reason to not get too excited is that the search for life starts small — microscopically small — and then looks to evolution for more. The first signs of life elsewhere are more likely to be closer to slime mold than to ET. It can evolve from there.
Scientists have an equation that calculates the odds of civilized life on another planet. But much of it includes factors that are pure guesswork on less-than-astronomical factors, such as the likelihood of the evolution of intelligence and how long civilizations last. Stripped to its simplistic core — with the requirement for intelligence and civilization removed — the calculations hinge on two basic factors: How many places out there can support life? And how hard is it for life to take root?
Alien Life Living Among Us?
What last week's findings did was both increase the number of potential homes for life and broaden the definition of what life is. That means the probability for alien life is higher than ever before, agree 10 scientists interviewed by The Associated Press.
Seth Shostak, senior astronomer at the SETI Institute in California, ticks off the astronomical findings about planet abundance and Earthbound discoveries about life's hardiness. "All of these have gone in the direction of encouraging life out there and they didn't have to."
Scientists who looked for life were once dismissed as working on the fringes of science. Now, Shostak said, it's the other way around. He said that given the mounting evidence, to believe now that Earth is the only place harboring life is essentially like believing in miracles. "And astronomers tend not to believe in miracles."
Astronomers, however, do believe in proof. They don't have proof of life yet. There's no green alien or even a bacterium that scientists can point to and say it's alive and alien. Even that arsenic-munching microbe discovered in Mono Lake in California isn't truly alien. It was manipulated in the lab.
But, says NASA astrobiologist Chris McKay, who has worked on searches for life on Mars and extreme places on Earth, "There are real things we can point to and show that being optimistic about life elsewhere is not silly."
First, there's the basic question of where such life might exist. Until a few years ago, astronomers thought life was only likely to be found on or around planets circling stars like our sun. So that's where the search of life focused — on stars like ours.
That left out the universe's most common stars: red dwarfs, which are smaller than our sun and dimmer. Up to 90 percent of the stars in the universe are red dwarf stars. And astronomers assumed planets circling them would be devoid of life.
But three years ago, NASA got the top experts in the field together. They crunched numbers and realized that life could exist on planets orbiting red dwarfs. The planets would have to be closer to their star and wouldn't rotate as quickly as Earth. The scientists considered habitability and found conditions near these small stars wouldn't be similar to Earth but would still be acceptable for life.
That didn't just open up billions of new worlds, but many, many times that.
Last week, a Yale University astronomer said he estimates there are 300 sextillion stars — triple the previous number. Lisa Kaltenegger of Harvard University says scientists now believe that as many as half the stars in our galaxy have planets that are two to 10 times the size of Earth — "super Earths" which might sustain life.
Then the question is how many of those are in the so-called Goldilocks zone — not too hot, not too cold. The discovery of such a planet was announced in April, although some scientists are challenging that.
The other half of the equation is: How likely is life? Over the past decade and a half, scientists have found Earth life growing in acid, in Antarctica and other extreme environments. But nothing topped last week's news of a lake bacterium that scientists could train to thrive on arsenic instead of phosphorous. Six major elements have long been considered essential for life — carbon, hydrogen, nitrogen, oxygen, phosphorus and sulfur. This changed that definition of life.
By making life more likely in extreme places, it increases the number of planets that are potential homes for life, said Kaltenegger, who also works at the Max Planck Institute in Germany.
Donald Brownlee, an astronomer at the University of Washington, is less optimistic because he believes what's likely to be out there is not going to be easy to find — or that meaningful. If it's out there, he said, it's likely microbes that can't be seen easily from great distances. Also, the different geologic and atmospheric forces on planets may keep life from evolving into something complex or intelligent, he said.
If life is going to be found, Mars is the most likely candidate. And any life is probably underground where there is water, astronomers say. Other possibilities include Jupiter's moon Europa and Saturn's moons Enceladus and Titan.
There's also a chance that a telescope could spot a planet with an atmosphere that suggests photosynthesis is occurring, Kaltenegger said. And then there's the possibility of finding alien life on Earth, perhaps in a meteorite, or something with an entirely different set of DNA.
And finally, advanced aliens could find us or we could hear their radio transmissions, McKay said. That's what the SETI Institute is about, listening for intelligent life.
That's where Shostak puts his money behind his optimism. At his public lectures, Shostak bets a cup of coffee for everyone in the audience that scientists will find proof of alien life by about 2026. The odds, he figures, have never been more in his favor.
___
Online:
NASA Astrobiology Institute: http://astrobiology.nasa.gov/
SETI Institute: http://www.seti.org/
In the past several days, scientists have reported there are three times as many stars as they previously thought. Another group of researchers discovered a microbe can live on arsenic, expanding our understanding of how life can thrive under the harshest environments. And earlier this year, astronomers for the first time said they'd found a potentially habitable planet.
"The evidence is just getting stronger and stronger," said Carl Pilcher, director of NASA's Astrobiology Institute, which studies the origins, evolution and possibilities of life in the universe. "I think anybody looking at this evidence is going to say, 'There's got to be life out there.'"
A caveat: Since much of this research is new, scientists are still debating how solid the conclusions are.
Another reason to not get too excited is that the search for life starts small — microscopically small — and then looks to evolution for more. The first signs of life elsewhere are more likely to be closer to slime mold than to ET. It can evolve from there.
Scientists have an equation that calculates the odds of civilized life on another planet. But much of it includes factors that are pure guesswork on less-than-astronomical factors, such as the likelihood of the evolution of intelligence and how long civilizations last. Stripped to its simplistic core — with the requirement for intelligence and civilization removed — the calculations hinge on two basic factors: How many places out there can support life? And how hard is it for life to take root?
Alien Life Living Among Us?
What last week's findings did was both increase the number of potential homes for life and broaden the definition of what life is. That means the probability for alien life is higher than ever before, agree 10 scientists interviewed by The Associated Press.
Seth Shostak, senior astronomer at the SETI Institute in California, ticks off the astronomical findings about planet abundance and Earthbound discoveries about life's hardiness. "All of these have gone in the direction of encouraging life out there and they didn't have to."
Scientists who looked for life were once dismissed as working on the fringes of science. Now, Shostak said, it's the other way around. He said that given the mounting evidence, to believe now that Earth is the only place harboring life is essentially like believing in miracles. "And astronomers tend not to believe in miracles."
Astronomers, however, do believe in proof. They don't have proof of life yet. There's no green alien or even a bacterium that scientists can point to and say it's alive and alien. Even that arsenic-munching microbe discovered in Mono Lake in California isn't truly alien. It was manipulated in the lab.
But, says NASA astrobiologist Chris McKay, who has worked on searches for life on Mars and extreme places on Earth, "There are real things we can point to and show that being optimistic about life elsewhere is not silly."
First, there's the basic question of where such life might exist. Until a few years ago, astronomers thought life was only likely to be found on or around planets circling stars like our sun. So that's where the search of life focused — on stars like ours.
That left out the universe's most common stars: red dwarfs, which are smaller than our sun and dimmer. Up to 90 percent of the stars in the universe are red dwarf stars. And astronomers assumed planets circling them would be devoid of life.
But three years ago, NASA got the top experts in the field together. They crunched numbers and realized that life could exist on planets orbiting red dwarfs. The planets would have to be closer to their star and wouldn't rotate as quickly as Earth. The scientists considered habitability and found conditions near these small stars wouldn't be similar to Earth but would still be acceptable for life.
That didn't just open up billions of new worlds, but many, many times that.
Last week, a Yale University astronomer said he estimates there are 300 sextillion stars — triple the previous number. Lisa Kaltenegger of Harvard University says scientists now believe that as many as half the stars in our galaxy have planets that are two to 10 times the size of Earth — "super Earths" which might sustain life.
Then the question is how many of those are in the so-called Goldilocks zone — not too hot, not too cold. The discovery of such a planet was announced in April, although some scientists are challenging that.
The other half of the equation is: How likely is life? Over the past decade and a half, scientists have found Earth life growing in acid, in Antarctica and other extreme environments. But nothing topped last week's news of a lake bacterium that scientists could train to thrive on arsenic instead of phosphorous. Six major elements have long been considered essential for life — carbon, hydrogen, nitrogen, oxygen, phosphorus and sulfur. This changed that definition of life.
By making life more likely in extreme places, it increases the number of planets that are potential homes for life, said Kaltenegger, who also works at the Max Planck Institute in Germany.
Donald Brownlee, an astronomer at the University of Washington, is less optimistic because he believes what's likely to be out there is not going to be easy to find — or that meaningful. If it's out there, he said, it's likely microbes that can't be seen easily from great distances. Also, the different geologic and atmospheric forces on planets may keep life from evolving into something complex or intelligent, he said.
If life is going to be found, Mars is the most likely candidate. And any life is probably underground where there is water, astronomers say. Other possibilities include Jupiter's moon Europa and Saturn's moons Enceladus and Titan.
There's also a chance that a telescope could spot a planet with an atmosphere that suggests photosynthesis is occurring, Kaltenegger said. And then there's the possibility of finding alien life on Earth, perhaps in a meteorite, or something with an entirely different set of DNA.
And finally, advanced aliens could find us or we could hear their radio transmissions, McKay said. That's what the SETI Institute is about, listening for intelligent life.
That's where Shostak puts his money behind his optimism. At his public lectures, Shostak bets a cup of coffee for everyone in the audience that scientists will find proof of alien life by about 2026. The odds, he figures, have never been more in his favor.
___
Online:
NASA Astrobiology Institute: http://astrobiology.nasa.gov/
SETI Institute: http://www.seti.org/
Friday, November 19, 2010
Facebook and Consumer Learning Process
A great deal of successful marketing today depends on closely understanding consumer behavior. As a marketer, you may always be curious to understand what excites or motivates your customers into buying either your products or those of your competitor. Depending on the buying and consumption cycle of your product, there can be several factors that will determine the sales conversion ratio for your product.
Toward Right Learning
A successful sale happens when your customer understands his need and is convinced that your product can satisfy that need in a reliable way. Both these steps happen through a process, which is known as learning. Hence as a marketer, your job begins by ensuring that the customer perceives his need and, more importantly, finds the solution in your product
Right Learning and Right Conversations
At this very moment, you may be reading this article on your laptop or desktop. Remember the day when you had decided to buy your first computer. You must have considered many factors before finalizing which computer to purchase. One of the important decision points for a buyer is his circle of reference. It is natural for you, as a buyer, to discuss with your informed friends about the best brand. Positive references from friends and acquaintances help one make a decision.
How has Facebook changed all of this?
Research has shown that buyers do a great deal of product research on the Internet and most of the time choose to purchase the product either online or offline. The power of the Internet as a research and information resource has been realized to a great extent by customers worldwide.
The basics of consumer behavior, learning, reference groups, and buying decisions have remained exactly the same. But what has changed significantly is the speed with which everything happens. Technology has brought down the barriers in global communication. Social networking sites, and more importantly the rising popularity of Facebook, bears a strong testimony to the growing power of the Internet as a mode of communication and a source of information.
Before and After Facebook
Like we discussed, most of the learning before the proliferation of Facebook and social media happened through advertisements on television. During the days of conventional media dominance, marketing was driven by the power to broadcast. Marketing communication was primarily unidirectional through blaring advertisements and press releases.
Word of mouth happened on a one-on-one basis, where the conversation would begin and end around a small group of people. Today, a search on your favorite brand on Facebook may reveal many conversations about the brand, which may depict user’s positive or negative experiences with the brand. Unlike the clandestine brand gossip of earlier days, the Facebook era ensures that conversations are documented and made easily available through social networking sites.
Brands trying to ignore this new medium find themselves in a state similar to an ostrich, with its head buried in sand, thinking the world cannot see it. The real image of the brand in people’s minds shows up aloud these days through conversations on Facebook.
These dumb kids on Facebook made $119,833.57
Facebook and Online Reputation
The power of Facebook, as discussed, has extended the scope of Word of Mouth beyond the good old conversation between friends. Today, each and every Facebook user is free to publish his views on your brand. The true effect of this happens whenever these conversations appear in searches and influence people’s opinion about the brand image. This is where online reputation, primarily on a widely accepted medium like Facebook, matters.
In a nutshell..
Managing a positive image of your brand requires you to expand your reach, more than what you would do in case of conventional media. The conversational nature of social networking sites, such as Facebook, demands a different approach. Unlike one-time broadcast by the conventional medium, Facebook stores each and every conversation and makes it available through the search option for anyone who is curious to know more about your brand.
That is the reason why it is a critical part of any brand plan to feature positively on social networking sites, such as Facebook. Engaging consultants who have experience in managing brands through the new era of social networks is a growing practice that can help brands manage the new wave.
Get more information here for the best Facebook training available.
Toward Right Learning
A successful sale happens when your customer understands his need and is convinced that your product can satisfy that need in a reliable way. Both these steps happen through a process, which is known as learning. Hence as a marketer, your job begins by ensuring that the customer perceives his need and, more importantly, finds the solution in your product
Right Learning and Right Conversations
At this very moment, you may be reading this article on your laptop or desktop. Remember the day when you had decided to buy your first computer. You must have considered many factors before finalizing which computer to purchase. One of the important decision points for a buyer is his circle of reference. It is natural for you, as a buyer, to discuss with your informed friends about the best brand. Positive references from friends and acquaintances help one make a decision.
How has Facebook changed all of this?
Research has shown that buyers do a great deal of product research on the Internet and most of the time choose to purchase the product either online or offline. The power of the Internet as a research and information resource has been realized to a great extent by customers worldwide.
The basics of consumer behavior, learning, reference groups, and buying decisions have remained exactly the same. But what has changed significantly is the speed with which everything happens. Technology has brought down the barriers in global communication. Social networking sites, and more importantly the rising popularity of Facebook, bears a strong testimony to the growing power of the Internet as a mode of communication and a source of information.
Before and After Facebook
Like we discussed, most of the learning before the proliferation of Facebook and social media happened through advertisements on television. During the days of conventional media dominance, marketing was driven by the power to broadcast. Marketing communication was primarily unidirectional through blaring advertisements and press releases.
Word of mouth happened on a one-on-one basis, where the conversation would begin and end around a small group of people. Today, a search on your favorite brand on Facebook may reveal many conversations about the brand, which may depict user’s positive or negative experiences with the brand. Unlike the clandestine brand gossip of earlier days, the Facebook era ensures that conversations are documented and made easily available through social networking sites.
Brands trying to ignore this new medium find themselves in a state similar to an ostrich, with its head buried in sand, thinking the world cannot see it. The real image of the brand in people’s minds shows up aloud these days through conversations on Facebook.
These dumb kids on Facebook made $119,833.57
Facebook and Online Reputation
The power of Facebook, as discussed, has extended the scope of Word of Mouth beyond the good old conversation between friends. Today, each and every Facebook user is free to publish his views on your brand. The true effect of this happens whenever these conversations appear in searches and influence people’s opinion about the brand image. This is where online reputation, primarily on a widely accepted medium like Facebook, matters.
In a nutshell..
Managing a positive image of your brand requires you to expand your reach, more than what you would do in case of conventional media. The conversational nature of social networking sites, such as Facebook, demands a different approach. Unlike one-time broadcast by the conventional medium, Facebook stores each and every conversation and makes it available through the search option for anyone who is curious to know more about your brand.
That is the reason why it is a critical part of any brand plan to feature positively on social networking sites, such as Facebook. Engaging consultants who have experience in managing brands through the new era of social networks is a growing practice that can help brands manage the new wave.
Get more information here for the best Facebook training available.
Tuesday, November 16, 2010
Facebook and Social Media - The Next Marketing Opportunity
Marketing as an activity is all about reaching the right customers with the right products, and the result sought is delighted customers who are more than willing to open their purses wide enough to boost your revenues. For many years, marketers stalked their target customers through various means and by trying to get their message across to spread awareness about their wares.
Traditional Means of Communication
Traditionally, marketing communications were conducted via print, broadcast and such traditional media through disruptive advertising, where advertisements appear in between the content of interest for the customer.
Traditional media does give a large reach to a marketer with its programming of mass appeal. However, the wastage is equally high, since a large portion of the audience would belong to a different segment than the one that is to be targeted by the marketer.
Enter Social Media and the Internet
The revolution stirred by the internet as a medium took place because of the fact that it is highly personalized and provides more content on-demand than any other available medium. Social sites proliferated far and wide in their usage for a few simple reasons:
The power to create and distribute content is equally available to every user, irrespective of him/her being a customer or a marketer. In the earlier forms of media, that power rested with the editorial staff of the channel or the advertiser, but hardly ever with the user.
The medium is completely personalized, and a user can create or join groups and further create content based on what he/she likes.
Opinions are free and fair. This is one reason why social media is of utmost concern to marketers, since buying decisions are no more influenced as much by advertisements. The traditional word-of-mouth marketing approach has grown leaps and bounds on social networks.
Facebook – At the Center of Social Media
With 500 million (and growing) unique users worldwide, Facebook is the number one social networking site in terms of activity and subscriptions. What started as a garage initiative by Mark Zuckerberg has now become the biggest phenomenon on the internet.
A user interface that allows for quick communication and the ability to create fan pages and groups at the click of a mouse button are what make Facebook extremely popular. Another important reason for its immense popularity is the wide variety of social applications that have been developed and made available within the Facebook environment.
These applications can allow users and friends to do joint activities like playing games that run endlessly, sharing photos, videos, and web links, and many more.
How does this help a marketer?
Traditionally, media plans were drawn to include television channels, publications, or any other media that can grab maximum eyeballs and effectively reach a selected target audience. The science of segmentation and targeting has become only more accurate in the case of social media.
Facebook provides a wide variety of avenues to communicate with the audience, which opens up an entirely different world of possibilities to have a fruitful dialogue with customers. Some of these methods used popularly by marketers are:
Get more information here for the best Facebook training available
Advertising: The first opportunity, which is the most obvious one, is advertising on Facebook. The difference, however, is the fact that you can create your own advertisement in a matter of minutes and also specify the details of your target group in terms of demographics and types of discussions where you want your advertisement to appear.
Fan Pages: Facebook allows every brand, as well as individual users, to create fan pages for their favorite celebrities and their own homegrown businesses. Large brands have also created their official pages on Facebook that have a huge, immediate fan following around the world. The fan page has immense utility to convey first hand information about the brand and also to collect immediate and frank feedback from your customers.
Branded applications: One of the most effective ways to engage a user toward your brand is by creating an application; this could be a game or a contest, with your branding coming across subtly through it.
What makes Facebook even more exciting is the way it allows you to target your communication sharply just to the customer segment you want to attract. It also provides analytics and page insights that give good feedback and measurement on the activity done.
The options provided by Facebook can be creatively explored and used judiciously for bringing about maximum benefits to any brand.
However, while doing all this, you need to be aware of the fact that customers have an equal say and have the ability to respond immediately to any of your actions with a thumbs up or a thumbs down. Availing the service of a social media consultant to work out a social media strategy may be required so that your efforts will not be in vain.
Get more information here for the best Facebook training available
Traditional Means of Communication
Traditionally, marketing communications were conducted via print, broadcast and such traditional media through disruptive advertising, where advertisements appear in between the content of interest for the customer.
Traditional media does give a large reach to a marketer with its programming of mass appeal. However, the wastage is equally high, since a large portion of the audience would belong to a different segment than the one that is to be targeted by the marketer.
Enter Social Media and the Internet
The revolution stirred by the internet as a medium took place because of the fact that it is highly personalized and provides more content on-demand than any other available medium. Social sites proliferated far and wide in their usage for a few simple reasons:
The power to create and distribute content is equally available to every user, irrespective of him/her being a customer or a marketer. In the earlier forms of media, that power rested with the editorial staff of the channel or the advertiser, but hardly ever with the user.
The medium is completely personalized, and a user can create or join groups and further create content based on what he/she likes.
Opinions are free and fair. This is one reason why social media is of utmost concern to marketers, since buying decisions are no more influenced as much by advertisements. The traditional word-of-mouth marketing approach has grown leaps and bounds on social networks.
Facebook – At the Center of Social Media
With 500 million (and growing) unique users worldwide, Facebook is the number one social networking site in terms of activity and subscriptions. What started as a garage initiative by Mark Zuckerberg has now become the biggest phenomenon on the internet.
A user interface that allows for quick communication and the ability to create fan pages and groups at the click of a mouse button are what make Facebook extremely popular. Another important reason for its immense popularity is the wide variety of social applications that have been developed and made available within the Facebook environment.
These applications can allow users and friends to do joint activities like playing games that run endlessly, sharing photos, videos, and web links, and many more.
How does this help a marketer?
Traditionally, media plans were drawn to include television channels, publications, or any other media that can grab maximum eyeballs and effectively reach a selected target audience. The science of segmentation and targeting has become only more accurate in the case of social media.
Facebook provides a wide variety of avenues to communicate with the audience, which opens up an entirely different world of possibilities to have a fruitful dialogue with customers. Some of these methods used popularly by marketers are:
Get more information here for the best Facebook training available
Advertising: The first opportunity, which is the most obvious one, is advertising on Facebook. The difference, however, is the fact that you can create your own advertisement in a matter of minutes and also specify the details of your target group in terms of demographics and types of discussions where you want your advertisement to appear.
Fan Pages: Facebook allows every brand, as well as individual users, to create fan pages for their favorite celebrities and their own homegrown businesses. Large brands have also created their official pages on Facebook that have a huge, immediate fan following around the world. The fan page has immense utility to convey first hand information about the brand and also to collect immediate and frank feedback from your customers.
Branded applications: One of the most effective ways to engage a user toward your brand is by creating an application; this could be a game or a contest, with your branding coming across subtly through it.
What makes Facebook even more exciting is the way it allows you to target your communication sharply just to the customer segment you want to attract. It also provides analytics and page insights that give good feedback and measurement on the activity done.
The options provided by Facebook can be creatively explored and used judiciously for bringing about maximum benefits to any brand.
However, while doing all this, you need to be aware of the fact that customers have an equal say and have the ability to respond immediately to any of your actions with a thumbs up or a thumbs down. Availing the service of a social media consultant to work out a social media strategy may be required so that your efforts will not be in vain.
Get more information here for the best Facebook training available
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