The Marketing Relevance Imperative

NIGEL: You're on ten on your guitar...where can you go from there? Where?
MARTY: I don't know....
NIGEL: Nowhere. Exactly. What we do is if we need that extra...push over the cliff...you know what we do?
MARTY: Put it up to eleven.
NIGEL: Eleven. Exactly. One louder.

-Conversation between filmmaker Marty DiBergi and guitarist Nigel Tufnel, This Is Spinal Tap

In study after study, consumers have stressed that, regardless of the channel, they’d rather not see ads. 

   - A 2004 study by Forrester found that when people watch pre-recorded television shows, they skip an average of 92 percent of the commercials

   - Most Internet users block pop-up ads, screen for adware, and safeguard against spam.

Confronting an ad-averse audience, how have major advertisers and ad agencies responded?  With more unwelcome, and in some cases underhanded, tactics – pandering ads, manipulative word-of-mouth campaigns, contracts that require a publisher to pull their ads if the publication prints a negative editorial about them... 

As marketers, we’re all in the same boat: how do you get heard above the din? Where do you go, what do you do, when the volume’s already at 10? Well, if you have the clout – and believe “He who succeeds shouts the loudest” – you:  

   - Run something shocking at a moment of maximum exposure

   - Try to control (i.e., threaten) the presumably impartial media

   - Claim it’s in all the service of branding

One naturally wonders: “This is how you gain trust?” These advertisers and agencies – what we’ll call legacy marketers – are resorting to tactics that not only ooze desperation but are ethically suspect.

Let’s give legacy marketers their due. They’re struggling to survive as media budgets get butchered. John Wanamaker’s oft-quoted adage about 50 percent of advertising being wasted pales in comparison to what they’re facing.

A recent study found that most of these advertisers don’t measure the impact of their television media budget; instead, they relegate it to a black box called “branding.” CEOs and CFOs aren’t fooled – to them, it’s a rationalization for inadequate measurement (branding as a “get out of jail free” card).

To add to the irony, these marketers aren’t fooling – let alone engaging – the public.

You can spend millions on monologues that swamp your target market, only to be muted by a single consumer voice on the Net. Many marketers fail to realize that they aren’t moving closer to dialoguing with consumers or learning how to thrive in a world where consumers are savvy and empowered, where information can be shared in seconds.

Just visit Amazon.com. Who do you think the consumer’s going to believe? The carefully selected expert on the dust jacket or opinions posted by peers?  Google away – third-party, consumer, and consumer group reviews are a breeze to find.

When brand messages are Tivo’ed, pop-up ads and irrelevant email marketing is tuned out, how do you justify your legacy budget? How does a marketer become more relevant?

Well, first, you don’t make a spectacle of yourself. The kid throwing a tantrum in the grocery store knows this is a way to garner attention. The problem is, it isn’t positive attention. The more shrill advertisers and agencies become, the more they employ aggressive/intrusive/obnoxious techniques, the more they distance consumers.

Under a constant onslaught of advertising, consumers have adapted, evolved. In order to process information, they’ve learned to be more vigilant, more adept in tuning out predatory messages. In short, consumers see a shark fin and steer clear. They have unprecedented access to information and are less likely to swallow what they hear from marketers. 

But marketers can take heart. Consumers and business-to-business targets have shown they will listen – and be receptive – to a truly relevant message delivered at the right place and time.

It's a simple, but true statement, that it's time to really get to know who you're talking to. Stop messaging that screams “Notice me”; choose messaging that means something to your targets. Start connecting with them.

Allocating media budgets based more on old habits and silos than information is part of the problem.

As the internet becomes an increasingly popular media choice and televisions soon get IP addresses, the potential and expectations for marketing relevancy will only increase. . 

There are marketing innovators to look to as models who don’t treat consumers like a cage of white mice.

Google's approach to advertising is an excellent  example. Google methodically creates systems based on relevance. Google knows that, in an age where consumers and business buyers have information so readily at hand, compelling marketing is pertinent marketing. Through being relevant to users searches, page editorial content or personal email content.

Few media outlets and brands have the trust to scan a user’s email for keywords and phrases and deliver back related advertising, but Google does. It speaks louder than words that consumers allow Google to look at their personal emails in order to get more relevant advertising. It is a testimony to that the fact that targets will listen if marketers will only take the time to be relevant.

Few marketers have made strides towards relevancy as assertively as Amazon.com and, to date, it has paid off dearly.

Marketing relevancy takes a lot more effort, but the rewards are in the results. 

Resource : http://marketingtoday.com/marketing/0905/relevant_marketing.htm 

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Why Microsoft May Be a 'Classic Value Trap'

The early days of January are typically a time of unbridled optimism. This will be the year we lose 10 pounds and learn to speak French; Japan will turn itself around; Microsoft (MSFT) stock will pull itself out of a decade of doldrums.

Most analysts are betting that the Redmond computer company’s time has come. The company’s fiscal-year revenue has nearly tripled to $74 billion in the last 10 years. At $27, the shares trade right at their 10-year average and yield more than it costs the company to issue debt. Redmond has Skunk-Worked an exciting new tablet and operating system it’s eager to showcase. It’s all backed by ridiculous amounts of free cash and a fortress-like balance sheet. The 12-month price target on the stock forecasts a 25 percent gain.
Still, the company has attracted at least one major detractor with a big megaphone: Barry Ritholtz, an asset manager who runs a quantitative research firm and founder of the well-trafficked blog The Big Picture. He considers the company a “classic value trap,” not unlike what its customers Dell (DELL) and Hewlett Packard (HPQ) were at the start of this annus horribilis. The problem, he says, is Microsoft Chief Executive Officer Steve Ballmer. “As long as he is running the show—he has missed every major trend in tech over the past decade—I have no confidence in the company.”
He has company. Activist investor David Einhorn has wanted Ballmer out for more than a year and was long the shares in hopes that such an ouster would boost Microsoft’s returns. The stock is up 3 percent this year, compared with the S&P 500’s 14 percent gain. The 13 years since Ballmer became CEO have included the Vista debacle, a thankfully thwarted bid to overpay for Yahoo! (YHOO), the ceding of search supremacy to Google (GOOG), and Apple’s (AAPL) envisioning and dominating much of the smartphone and tablet markets. Meanwhile, where’s that “Skype Phone” in every palm?
‘Value trap’ is a funny term, says Bill Koefoed, Microsoft’s general manager of investor relations. Microsoft, he says, is trading in line with the big-cap technology sector, which has recently been out of favor with investors.
“Enterprise tech hasn’t been as sexy to the press. But our relevance to the enterprise has grown in a huge way. Our database business is growing faster than Oracle’s (ORCL) and IBM’s (IBM).”
Koefoed says people focus on Windows, which provides a quarter of Microsoft’s overall revenue, but not on the comparable 25 percent contribution from the company’s servers and tools division, which he emphasizes that Ballmer has grown, from a $3 billion business, to a $19 billion enterprise over the past decade. ”Over time, the stock price works itself out. We’re doing a whole bunch of things to be shareholder-friendly. Over time, that will be reflected in our share price.”
Meanwhile, Koefoed says, it was under Ballmer that the company initiated and consistently increased its dividend—with Microsoft shareholders overwhelmingly backing the CEO last month.
Ritholtz is unpersuaded “Think of the difference between what is revealed by a single snapshot of Microsoft today vs. an extended video. Yes, you can see the current situation of lots of cash, a low price-earnings multiple, name recognition, enterprise usage. But what about the trajectory and changes to the underlying market for their goods and services?”
He says that other than Kinnect for Xbox 360, “it’s hard to see what Microsoft gets for its billions of [research and development] dollars.”
“The competitive landscape has been moving against Microsoft,” wrote N. Landell-Mills of Indigo Equity Research after Microsoft’s “uninspiring” latest quarterly report, which involved the company raising its dividend 15 percent. The analyst called the organization “un-innovative and complex” and “a digital dinosaur.”
The full rollout of Windows 8 could, of course, change that state of affairs. Not that early signs are promising.
With the PC replacement cycle stretched out and assailed by competition that Microsoft failed to oppose, Ritholtz has taken to comparing its fate to that of Maytag (WHR). “It was,” he says, “once hugely successful and innovative and created lots of products and markets. Now you replace your dishwasher every 10 years; that’s the only time you ever think of Maytag.”
Read more: http://www.businessweek.com/articles/2012-12-28/why-microsoft-may-be-a-classic-value-trap#r=hpt-ls

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Parl passes banking bill, paves way for setting up more banks

New Delhi: Parliament Thursday paved the way for corporate houses to enter the banking sector by approving the banking bill, a key reform legislation pending for long.

Parliament also passed the amendments to the debt recovery laws or Sarfesi law after a reply by Finance Minister P Chidambaram on the combined discussion on the two bills in Rajya Sabha.

These two Bills -- Banking Laws (Amendment) Bill, 2012, and Enforcement of Security Interest and Recovery of Debts Laws (Amendment) Bill, 2012, -- he said, will strengthen the financial sector and help in establishing large-sized banks, besides promoting financial inclusion.

"We need 2-3 world-sized banks. China has three among the world's top 20. We have none. We need more banks," he said.

"Banks have opened 6,489 branches in 2011-12 alone that is around 18-19 per day. We don't have the capacity to open more branches. We need banks," he said.

The Lok Sabha had already passed these two Bills.

Chidambaram said the amendment was not intended to give banking licences to big corporate houses alone, but also to allow eligible public sector entities to enter the sector.

The Banking Bill was approved by the Lower House earlier this week after the government dropped the controversial clause concerning allowing banks to trade in commodity futures.

Referring to Thursday's strike by bank unions against reforms, Chidambaram said he could only request the bank employees to refrain from such activities.

"I don't know why they should go on strike. There is no longer greater public support for this (kind of) strike...I think any matter can be talked out. We are open to talks. Strike is not desirable," Chidambaram said pointing out that strikes have become "less and less frequent."

The Banking Laws (Amendment) Bill, 2012, which seeks to strengthen banking regulation, was passed by the voice vote in the Upper House.

The Bill will allow RBI to supersede boards of private sector banks and increase the cap on voting rights of private investors in PSBs to 10 percent, from one percent now.

Responding to queries by members, he said the government does not have any intention "at this point" to look for a new regulator alongside RBI.

The central bank wanted the government to amend banking laws before initiating the process of issuing new banking licences. The passage of the bill will prompt RBI to move ahead with the proposal of granting new licence.

The bill will keep banking merger and acquisitions under the purview of the Competition Commission of India (CCI) as well, Chidambaram said.

The bill, along with proposed legislations on pension and insurance, was one of the five key reforms measures on the government's agenda during the current session of Parliament.

The debt recovery bill is aimed at facilitating recovery of loans by banks.

At present, there are 14 Asset Reconstruction Companies (ARCs) in the country. As many as 64,000 cases are pending before the Debt Recovery Tribunal (DRT).
resource:http://zeenews.india.com/business/news/finance/parl-passes-banking-bill-paves-way-for-setting-up-more-banks_66721.html

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IIITM Kerala Recruitment for the Language Editor post

Recruitment for the Language Editor post

Eligibility: MA(Hindi, Malayalam)

Location: Thiruvananthapuram

Job Category: Govt Sector, Others

Last Date: 30 November 12

Job Type: Full Time

Hiring Process: Written-test and Interview.

No. IIITMK/ 0029 /2012 November 12, 2012
Indian Institute of Information Technology and Management-Kerala (IIITM-K), invites applications for the post of Language Editor 

Qualification : 1. Masters in Malayalam/Hindi 2. Knowledge of Unicode based Editors and online tagging

Salary : Rs. 10,000/-

How to apply

 

Applications complete in all respects, in the prescribed form, along with photocopies of certificates should reach the office of to The Manager (Finance and Administration) IIITM-K, IIITMK Campus, Technopark, Thiruvananthapuram-695 581 on or before 30th November , 2012 on super scribing the envelope with “Application for the post & Project applied ……………” 

Click Here For Details & Application Form

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Yahoo buys mobile start-up

(Reuters) - Yahoo Inc said on Thursday it bought a small, mobile start-up company in New York, marking one of new Chief Executive Marissa Mayer's first moves to revamp the struggling Web pioneer by acquiring outside products and technology.
Yahoo purchased Stamped, which makes a product that lets consumers share favourite restaurants and music on their smart-phones. It did not disclose financial details.
In a blog on the Stamped website, Stamped co-founders wrote that Yahoo would discontinue the Stamped product by the end of the year and that the team would be working on something "big, mobile and new."
"As a team of mostly former Googlers, we've all worked with and are big fans of Marissa. So when an opportunity arose to become a part of the team at Yahoo!, we jumped," read the blog post, which featured a picture of the three co-founders alongside Mayer.
A former Google Inc executive, Mayer took over as Yahoo CEO in July, becoming the latest in a string of executives to try to revive revenue growth at the Web portal.
During Yahoo's quarterly earnings conference call on Monday - her first public remarks since taking the helm - Mayer said that her top priority was to create a coherent mobile strategy for Yahoo.
Yahoo said the Stamped team consists of nine employees.
The company, with not quite two years of history under its belt, has already won seed funding from celebrities such as pop star Justin Bieber and The New York Times, according to Crunch-base, an online blog and database of venture capital transactions.

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Miners take "rail-veyors" and robots to automated future

(Reuters) - In an office trailer parked outside a mine shaft in northern Ontario, operator Carolyn St-Jean leans back in her chair and monitors a machine loading nickel-rich ore into rail cars deep underground.
Once filled, the automated train will snake through a series of narrow tunnels, emerge from a rocky outcropping, then loop past St-Jean's window and dump its payload for sorting.
Vale SA, the Brazilian company that owns the mine near this nickel-rich Canadian town, has spent nearly $50 million in two years to install and test the "rail-veyor." The company believes the transport system will revolutionize how it builds and extracts new mineral deposits.
The equipment is made locally by Rail-Veyor Technologies Global Inc. It is one of many mining technologies that developers hope will allow future production to be run almost entirely by people safely above ground.
Such advances may prove crucial as easy-to-exploit deposits run dry and miners drill deeper in more remote places to supply China, India and other emerging economies. The technology could make mining cheaper and safer, avoiding the need to dig wide tunnels and hire large numbers of expensive, skilled workers.
"As we go deeper, if we continue to apply existing thinking and existing technologies, it's a death spiral" for company profits, said Alex Henderson, who heads Vale's technology team in Sudbury.
"We need to begin to look at a step-change in mining rather than just incrementally improving our existing processes."
The rail-veyor is one such step-change. At the test site, it has halved the time to build a mine, and Vale expects a 150 percent boost in production rates before year end.
In Australia, Rio Tinto Ltd, one of the world's largest miners and an automation pioneer, is rolling out a fleet of self-driving trucks and trains at its iron ore operations. Vale, BHP Billiton and Chile's Codelco are in hot pursuit.
Gold miner AngloGold Ashanti is eyeing automation in South Africa, where miners spend hours each shift traveling up and down shafts and ounces of gold are left behind in support pillars each year.
Organized labor has made its peace with the automation drive, although there were some concerns that robots would displace humans.
"We're ok with automation, it's part of the changing times and it's a good thing for productivity," said Myles Sullivan of the United Steelworkers Canada, whose workers ended a year-long strike at Vale over bonuses and wages in 2010.
700 STORIES UNDERGROUND
New challenges in mining are driving technological changes. Large, accessible deposits have all but disappeared. Resources of tomorrow are in far-flung corners of the globe or hundreds of meters beneath the surface.
Add a shortage of skilled labor - expected to worsen as the baby-boom generation retires - and mining costs have surged.
While soaring demand means higher metal prices, rising costs are crimping profits. Canada's S&P/TSX Mining share index has fallen more than 38 percent since the beginning of 2011.
Experts say mining companies must change how they operate.
Making that shift is not easy for an industry steeped in tradition, especially when change doesn't come cheap. Rio Tinto is spending more than $500 million on train automation alone.
"This is a very conservative industry that has been very productive over the last 30 years doing it the way they're doing it now," said Douglas Morrison, chief executive of the Centre for Excellence in Mining Innovation (CEMI), an industry-funded research center in Sudbury.
"But is the old way going to work for us into the future? I think probably not, so we need to make some changes."
After decades of production, the nickel mines around Sudbury are getting deeper and deeper. At Vale's Creighton mine, the No. 8 shaft drops nearly 8,000 feet into the ground - equivalent of a 700-story condo tower.
At that depth it is very hot, around 50 degrees Celsius (120 Fahrenheit), so tunnels must be pumped full of cooled air to make temperatures manageable for people and heavy machinery.
"The bigger issue is when we get much deeper we start to generate our own earthquakes - very small earthquakes - these are called 'rock bursts,'" said Morrison.
Smaller tunnels and new ways of digging can hopefully reduce the danger of these rock bursts, which create a safety concern and slow development.
Rio Tinto is working with CEMI on automated tunnel borers, currently used to build subway and sewer tunnels. By cutting through the rock instead of blasting, Rio aims to quadruple its underground advance rates to 20 meters a day.
But while automated tunnel borers will build shafts and tunnels more quickly, massive mining equipment still handicaps the industry, which is where Vale's rail-veyor comes in.
A train hauling 50 tonnes of ore uses a far smaller tunnel than a truck with the same load. By taking the massive trucks and scooptrams - large vehicles with shovels on the front - out of the equation, Vale can build more compact and stable tunnels.
The rail-veyor, built on tracks that zig-zag down to the deposit, actually eliminates the need for expensive shafts and may eventually move people and equipment, along with ore.
Vale's Henderson believes the technology - which the company plans to roll out in five upcoming projects - is a game-changer that will help usher in a new era of mining.
"Just as the scooptram was the key enabler for the mechanized era, is the rail-veyor a key enabler for the next?" he said.
MAN VS MACHINE
What that "next era" will look like is still up for debate. Some innovators believe robots will do most of the labor in mines of the future, as in automobile assembly plants. This would ease likely shortages in skilled labor in many countries.
Over the next decade Canada's mining sector will need more than 100,000 skilled new hires to sustain even modest growth, according to the Mining Industry Human Resources Council.
In Australia, the labor crunch is already so intense that truck drivers can make upwards of $100,000 a year, with turnover rates at some mines still near 40 percent.
"One of the biggest problems that the mining industry faces worldwide is trained personnel. We can't get them," said John Meech, director of CERM3, a mining research center at the University of British Columbia in Vancouver.
"One of the ways we are going to have to deal with that is to automate the systems so that the human becomes the supervisor, rather than the direct means of control."
It is a concept already used at remote open-pit mines in Australia, where Rio's new fleet of driverless trucks can be run from a control room hundreds of miles away.
Canada's Nautilus Minerals Inc is using automated rovers to explore the ocean bed for mineral deposits that underwater robots will eventually mine.
In addition to boosting productivity, the advances will enhance safety. As labor leader Sullivan says, "so long as there's underground mining, there will be women and men working underground."
Safety is the focus at a converted schoolyard just outside Sudbury, where a duo of mine rescue robots roll through a makeshift obstacle course. Their thick tires grind over logs and through mud pits.
Designed by Canada's Penguin Automated Systems Inc, the equipment is being tested by Codelco at its Andina copper mine in Chile, doing dangerous jobs like checking stability after blasting and surveying tunnels at risk of flooding.
resource:http://www.reuters.com/finance/smallBusiness

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A startup hub emerges in Chicago

(Reuters) - Bernhard Kappe, the chief executive officer of Chicago's Pathfinder Software, steps up to a dry erase board and draws a crude graph, its slope curves upward. Then he plots a point in the middle to show where the city's web entrepreneurs stand in terms of growth and progress.
"These things take 20 years to get to maturity, and they're not linear," says Kappe, who's also an executive director of the Chicago Lean Startup Circle, a group that fosters local website development. "But we're six to seven years in, and definitely in an acceleration stage."
While Chicago may not compare to Palo Alto in terms of high-tech sexiness, it's experienced enough high-profile success stories in the past few years - from Groupon to 37Signals to Trunk Club, launched by Bonobos founder Brian Spaly. Now local entrepreneurs and members of the startup community are uniting to help continue the momentum.
And that's where the Chicago Lean Startup Circle comes in. The group now claims 2,800-plus members, an 18-fold explosion since Kappe and Todd Wyder, Pathfinder's chief product officer, assumed leadership nearly three years ago.
Aside from solid growth, the group also brandishes some feisty attitude and is not afraid to self-promote, describing itself as "a group of smart and driven high-tech entrepreneurs that have learned how to discover customers and build products they want."
That's no idle boast given the numbers Kappe and Wyder produce to make their case. In a survey of Chicago Lean Startup members last year, the 20 percent who responded (about 500-plus people) reported that their companies had created 7,047 tech-sector jobs.
Of course, Chicago isn't the only city with such a circle; Kappe says about 130 such lean startup groups exist worldwide, with Chicago ranking above Boston, but behind New York in membership.
But Chicago's circle has done better work than other similar organizations in tooting its horn and marshaling creative resources. For starters, it partners with other groups such as Built In Chicago (an online community for local startups) and 1871 (a co-working center for digital startups, taking its moniker from the year of the Great Chicago Fire). Kappe and Wyder have also added incentives, offering prizes of $25,000 on cash and $50,000 in services in their annual "Lean Startup Challenge."
"If you look at the Chicago tech scene, a number of leaders and groups have emerged where we all want the same thing: making Chicago's entrepreneurial community the best in the world," Kappe says.
There's been exciting news this month as well, with the venture capital firm New Enterprise Associates establishing a new Chicago office with its $35 million investment in Braintree, an online and mobile payments company.
But can Chicago become, say, a Midwestern Silicon Valley? Kappe says that's hardly the goal, adding that, "We have a lot of great relationships in the valley." He sees Chicago building a tech scene based on its strengths as a business-to-business hub, a view supported by tech experts and observers.
So while launching another high-profile consumer site a la Groupon would bolster the area's startup scene, there's already plenty of action among portals that provide niche services to the restaurant and health care industries, for example. At Pathfinder, Kappe creates medical software solutions for institutions using lean innovation techniques.
"The sheer scale of Silicon Valley makes it difficult for any city to match," says Fred Diaz, city manager of Fremont, California, a worldwide hub for web startup activity. "But rather that replicate Silicon Valley, Chicago should strive to be the best entrepreneurial Chicago it can be. That's what will drive success."
"Chicago can become a vibrant tech hub, but in a much different way," says Leena Rao, a senior editor at TechCrunch. "We need to remember that Chicago becoming a tech hub is a marathon, not a sprint. But the signs are promising; the area has a good talent base," supplemented by top-tier universities and the support of Mayor Rahm Emanuel, who's made high-tech development a priority of his administration.
"The city is conducive to startups," says Jeffrey Harrington, who launched his restaurant-vendor service website Cardoona with plenty of help from Kappe and Wyder's group. "The culture is very collaborative. It could've taken us three years to figure out our first three business models were wrong. Through, it took us less than 3 months, preventing us from wasting huge amounts of time and money."
Kadesha Thomas attended her first meeting of the Chicago Lean Startup Circle a year ago. The freelance writer had hit on an idea for a website to create custom content for health care clients, but felt sheepish about writing a huge business proposal or hitting up a bank for funds.
"They discourage you from getting any money until you've validated the idea and come up with something solid," Thomas says of the circle members. "That made my barrier to entry a lot lower. All you have to do is talk to your customer and get to know their needs."
Thanks to the guidance of Kappe, Wyder and others, she launched her CareContent.com website on October 22 without borrowing a dime from friends or family. "We have a lot of great leads and a lot of people really interested in being our first customers," she says. "It's very exciting."
resource:http://www.reuters.com/article/2012/10/31/us-startup-hub-idUSBRE89U1DL20121031

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Asian shares fall after disappointing U.S. earnings

A visitor looks at market indices displayed at the Tokyo Stock Exchange in Tokyo September 26, 2012.

Credit: Reuters/Yuriko Nakao

By Chikako Mogi

TOKYO | Mon Oct 22, 2012 1:36am EDT

(Reuters) - Asian shares fell on Monday as lackluster earnings from leading U.S. companies and a sharp drop in Japan's exports, a key driver of the world's third-biggest economy, dented risk appetites and prompted investors to take profits on recent gains.
The euro, however, crept higher after Spanish Prime Minister Mariano Rajoy secured backing for his austerity drive in a vote in his home region of Galicia on Sunday, a result seen taking Madrid a step closer to asking for international aid.
Asian equities followed Wall Street, which had its worst day since late June on Friday when barometers of the overall U.S. economic health, General Electric (GE.N) and McDonald's (MCD.N), disappointed investors with their results.
Analysts said this provided an excuse for profit-taking in Asian stock markets, many of which had rallied to multi-month highs recently on new global central bank easing and the European Central Bank's plan to buy bonds of struggling euro zone countries that ask for aid.
The MSCI index of Asia-Pacific shares outside Japan .MIAPJ0000PUS fell 0.4 percent but trimmed earlier losses. South Korean shares .KS11 fell 0.2 percent, recovering from an earlier drop of over 1 percent while Australian shares AXJO. also curbed earlier losses to fall 0.6 percent.
Hong Kong shares .HSI bucked the trend and inched up 0.2 percent, hovering near a seven-month high touched last week, with bourse operator Hong Kong Exchanges (HKEx) (0388.HK) strong on expectation that further capital inflows into the territory could buoy trading activity.

U.S. stock futures were up 0.3 percent to hint at a firm Wall Street open, but European shares will likely decline, with financial spreadbetters expecting London's FTSE 100 .FTSE, Paris's CAC-40 .FCHI and Frankfurt's DAX .GDAXI to open down as much as 0.6 percent. .L .EU .N
"Profit-taking is overshadowing buying because any forward momentum has been exhausted," Oh Tae-dong, an analyst at Taurus Securities in Seoul wrote in a note to investors. He said he expects the Korea Composite Stock Price Index to hover around current levels for the time being.
The Korea's index was still up around 9 percent from lows hit in late July. The index hit a 5-month high in September.
Australian shares scaled a 15-month high last week and the benchmark index was up nearly 6 percent since a low on September 5.
"After a rally of several weeks, buying tends to run out of steam while profit takers become more trigger happy," said CMC markets analyst Ric Spooner.
Japan's Nikkei average .N225 turned positive, gaining 0.2 percent as the yen fell to a two-month low against the dollar, helping exporters. .T
The dollar hit a two-month high of 79.60 yen, as a break above a key technical level spurred further buying.
Data on Monday showed that, year-on-year, Japan's exports in September fell at their fastest rate since the February 2011 earthquake, and the mood among manufacturers was at its lowest since early 2010.
The reports reinforced concerns that Japan may slide back into recession as sales to China and Europe sag amid the global slowdown and domestic demand, led by rebuilding from last year's disaster, loses momentum.
A Reuters poll showed that China, the world's second-largest economy, could stage a tepid economic rebound in the fourth quarter on higher public infrastructure spending, though growth will remain lethargic through 2013.
U.S. crude erased earlier losses to rise 0.5 percent to $90.52 a barrel and Brent added 0.6 percent to $110.83.
Weaker equities weighed on Asian credit markets, pushing out the spread on the iTraxx Asia ex-Japan investment-grade index wider by 4 basis points.
MIXED SIGNALS IN EUROPE
The euro was resilient despite mixed signals from the euro zone over the progress of its three-year debt crisis, trading up 0.3 percent at $1.3053.
Germany raised new hurdles on Friday to using the euro zone's rescue fund to inject capital directly into ailing banks from next year, limiting the impact of a key agreement by European Union leaders on Thursday to establish a single banking supervisor from 2013.
But Spain and Greece were still expected to get aid, possibly next month and improving investor confidence was evident in government bond yields for highly-indebted Italy and Spain, which tumbled on Friday to multi-month lows after successful debt sales in both countries.
Some indicators were more cautious as investor focus turned to the corporate earnings seasons now under way in the United States.
The CBOE Volatility index .VIX, a gauge of expected volatility in the S&P, jumped 13.5 percent to close at 17.06 on Friday. It hit a five-month high earlier on Friday.
resource:http://www.reuters.com/article/2012/10/22/us-markets-global-idUSBRE88901C20121022

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Analysis: Most companies won't be early adopters of Windows 8

SEATTLE | Mon Oct 22, 2012 12:11am EDT

(Reuters) - There was once a time when the launch of a new Windows operating system was a huge deal for the technology departments in many businesses. Not anymore. Microsoft Corp's release of Windows 8 on Friday is likely to be a non-event for most companies -- and some experts say many may never adopt it.
The system may appear to offer something for everyone: touch-screen functionality for tablet enthusiasts, a slick new interface for the younger set, and multiple versions to make it compatible with traditional desktop PC software.
Many businesses, though, say there is no compelling reason to adopt. Indeed, a large number have yet to make the transition to Windows 7 from Windows XP.
"Windows 8 is, frankly, more of a consumer platform than it is a business platform, so it's not something that makes any sense from a business perspective at this juncture," said Doug Johnson, head of risk management policy at the American Bankers Association, whose members are among the world's biggest technology buyers. "There is really no additional business functionality that Windows 8 gives you that I see."
For most of the past two decades, that sort of comment about a new version of Windows might have set off panic in Microsoft's Redmond, Washington, headquarters. Not now. Windows 8, in a stark reflection of how the technology business is changing, will rise or fall on how it is received in the consumer market.
That doesn't mean Microsoft executives are publicly saying they won't be going after enterprise customers with the radical new version of its flagship product.
"The lines between the consumer and the enterprise are blurring," said Ron Markezich, head of Microsoft's Enterprise & Partner Group. "Business customers are looking forward to Windows 8 because they don't have to compromise between tablet and PC."
But Microsoft's main goal is to show it can master the new touch-optimized, mobile forms of computing pioneered by Apple Inc and Google Inc. Its colorful, action-packed advertising for the system are aimed at a young, free-wheeling audience, and its new Surface tablets are being positioned squarely as consumer devices.
LUKEWARM
Corporate customers have been lukewarm about the product even after test versions have been available for more than a year.
Car maker Volkswagen, which only last year moved 60,000 PCs onto Windows 7, is not planning to make another drastic shift anytime soon.
VW's head of IT, Martin Eickhoff, said his team was "excited to evaluate the new tablet features" but would wait until Windows 8's release to assess its potential benefits.
That's not unusual, as corporations generally test a new system for 12-18 months before planning to adopt it, meaning enterprise take-up of most versions of Windows -- except for the unpopular Vista -- have only usually happened two or three years after launch.
This time even that pattern might not happen.
Michael Silver, an analyst at technology research firm Gartner, expects minimal corporate adoption over the life of the new system: "We believe 90 percent of large organizations will not deploy Windows 8 broadly, and at its peak, we expect about 20 percent of PCs in large organizations will run Windows 8," he said.
WINDOWS RECEDES
This may not be a huge problem for Microsoft.
For one thing, the company gets 40 percent of its overall revenue from multi-year licensing deals with enterprises -- companies, government departments and universities -- which typically give customers rights to the newest version of its software.
Essentially, Microsoft gets paid regardless of what version of Windows many big customers actually use.
And Windows is also declining in financial importance for Microsoft, although the sales of PCs often determine the strength of Microsoft's earnings. Five years ago, it accounted for almost 30 percent of Microsoft's sales. Last year it was 25 percent.
Microsoft's success in selling to businesses, in the short term at least, depends less on Windows than on its Office products and its fast-growing server and tools division.
One institution that has made an early move to Windows 8 is Seton Hall University in New Jersey. The school has already deployed tablets and laptops running pre-release versions of Windows 8 to its freshman and junior classes -- with help from Microsoft, which subsidized the effort with free consulting time.
"The benefit of the upgrade to Windows 8 for me is that it's touch friendly. Lots of the devices that we have in the community could benefit," said Stephen Landry, Seton Hall's chief information officer.
Landry said his students overwhelmingly liked the new system, after a brief training session, but he acknowledged that many of his peers in higher education were not ready to move so fast.
"Talking to a lot of CIOs, they are not ready to jump into Windows 8 with both feet yet. They are taking a wait-and-see attitude. They are thinking 'That's a lot of work, I need to upgrade System Center (Microsoft's IT management platform), I need to have a little different process for managing the back end.' A lot of CIOs I've talked to, they are saying I'm not really seeing a benefit."
Steven Hanna, chief information officer of Kennametal Inc, an industrial parts and tools manufacturer based in Latrobe, Pennsylvania, said his company has only just moved onto Windows 7, and has no plans to introduce Windows 8 broadly in the near future. But he may deploy it selectively for employees who can make use of the touch-screen, such as traveling sales reps.
"The mobility for the sales force, to put all the material and the ability to do basic transactions in their hands, is going to be a phenomenal driver for us," said Hanna. "We're doing some piloting with iPads, but I'm excited to see the Windows stuff come out."
This appears to be the most likely route for Windows 8 into the workplace. But even this will not be simple because Windows 8 is really two operating systems.
The standard Windows 8 for devices with Intel Corp x86 chips will run old Microsoft applications and generally fit seamlessly into companies' networks and security systems, just like any Windows PC. But Windows RT, the version for devices powered by ARM Holdings chips -- such as Microsoft's new Surface tablet -- will not run legacy applications and require more work to integrate.
MOVING FROM XP
Even as it launches Windows 8, a key priority for Microsoft is to get customers off the decade-old Windows XP -- which still runs on 41 percent of the world's 1.5 billion PCs. For the last three years, it has urged enterprise customers to move to Windows 7, and it has said it does not expect organizations to drop those plans because of Windows 8.
That effectively means many companies will downgrade new PCs to run on Windows 7, not 8, over the next few years.
But if people start bringing Microsoft's new Surface tablet to work, or any of the other new Windows 8 devices, Microsoft is hoping corporate IT managers will welcome them with open arms.
resource:http://www.reuters.com/article/2012/10/22/us-microsoft-windows8-business-idUSBRE89L03N20121022

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China cabinet seeks ambitious economic reform agenda: advisers

China's Premier Wen Jiabao waits for a question at his annual news conference following the closing session of the National People's Congress (NPC), or parliament, at the Great Hall of the People in Beijing March 14, 2011.

Credit: Reuters/Jason Lee/Files

By Kevin Yao

BEIJING | Sun Oct 21, 2012 5:34pm EDT

(Reuters) - China's top leaders have asked policy think-tanks to draw up their most ambitious economic reform proposals in decades that could curb the power of state firms and give more freedom to the setting of interest rates and the yuan currency.
But after almost 10 years of delay to painful structural reforms by the outgoing leadership, some of the authors of the proposals told Reuters they fear a nascent rebound in economic growth could derail the recommended agenda.
"China is approaching a stage when the government must embrace more fundamental reforms," said Shi Xiaomin, vice president of the China Society of Economic Reform, a think-tank under the National Development and Reform Commission, the top economic planning body.
China's once-in-a-decade leadership change will be finalized next month at the ruling Communist Party's 18th congress. Vice President Xi Jinping is set to take over from Hu Jintao as president and Li Keqiang will replace Wen Jiabao as premier at the meeting, which opens on November 8.
The congress convenes as the economy heads for its weakest annual growth rate in at least 13 years after three decades of near 10 percent annual expansion in the wake of sweeping reforms launched by former leader Deng Xiaoping.
Reuters interviewed five policy advisers involved in drawing up the reform proposals. They said the order for the agenda came from members of the State Council, or cabinet, although they declined to give specifics for fear of repercussions.
Significantly, planning sources said cabinet members had signaled an interest in seeing proposals from policy advisers outside Beijing, in the provincial hinterland, implying that a nationwide consensus is being sought on the content and timetable for painful structural reform.
High on the list drawn up by the advisers is how to contain the government's meddling in the economy and clip the wings of more than 100,000 state-owned enterprises (SOEs) which enjoy enormous privileges, including preferential access to bank lending and government contracts.
Other reforms include allowing the market to set the cost of bank credit, land and various natural resources.
Credit is currently basically allocated by the central government. It tells state-backed banks how much to lend and when - mainly to other big state-controlled businesses and projects. Meanwhile all land and basic resources are owned by the state, with private ownership limited to temporary leased rights to usage.
Analysts say reform of these two areas would bring fundamental change to China's economic structure, even more so than making the yuan currency more convertible - also on the table as part of a package of proposals to liberalize capital markets and boost the yuan's use in global trade settlement.
Reform to China's complex tax structures, under which the central government commands the lion's share of receipts while local governments do most of the spending, is needed if serious progress is to be made cleaning up local government debt that stood at 10.7 trillion yuan ($1.7 trillion) at the end of 2010.
"I think a consensus on reforms has been formed at the central level, even though people may have different considerations on when and how to implement reforms," said Wang Jun, senior economist at the China Centre for International Economic Exchanges, a top government think-tank in Beijing.
UNFINISHED BUSINESS
Experts say Chinese leaders must unlock fresh growth potential and put the economy on a more sustainable path to avoid the "middle-income trap", where wealth creation stagnates as market share is lost to lower cost competitors and the attainment of high-income country status stays out of reach.
The World Bank says China's GDP per capita was $5,500 last year, versus $22,400 in South Korea, $34,500 in Hong Kong and $46,200 in Singapore, which all avoided the middle-income trap.
There has been soul searching among Chinese academics about the 4 trillion yuan ($640 billion) stimulus package unveiled in late 2008, which led to excessive investment in white elephant projects, created mountains of local government debt and sent house prices rocketing in big cities.
The stimulus helped state-owned firms stage a comeback at the cost of private businesses.
SOEs have repeatedly fought off Beijing's plans to get them to pay higher dividends to state coffers and have sought to delay reforms on income distribution systems, which could imply capping hefty wages in monopoly sectors, government sources say.
The reforms aim to require SOEs to pay more dividends to the government to meet a funding shortfall in social welfare.
"We could see serious problems if we don't reform," said Zuo Xuejin, head of the Institute of Economics at the Shanghai Academy of Social Sciences, which advises the local government in China's financial hub.
Still, some government advisers fear signs of a recovery in the economy could ease the pressure to act.
China's annual economic growth slowed to 7.4 percent in the third quarter from 7.6 percent in the second - the seventh consecutive quarter of slower expansion, but government officials have flagged signs of a modest rebound in September.
Industrial production, retail sales and investment data were all slightly ahead of forecasts in September and quarter-on-quarter GDP growth was strong, suggesting the worst may be over and the world's No.2 economy will pick up in the final quarter.
"They may have to change if there is an economic crisis, but they may choose to muddle through if the economy recovers," said an economist with a top government think-tank in Beijing, who requested anonymity due to the sensitivity of the issue.
TRAJECTORY OF CHANGE
Past changes tend to support the anonymous economist's view.
Deng Xiaoping launched economic reforms in the late 1970s to rescue an economy on the verge of collapse after Mao Zedong's disastrous Cultural Revolution.
He made his famous tour of southern China in 1992 to jumpstart the second stage of reforms when the economy nosedived in the aftermath of the 1989 Tiananmen Square crackdown. And sweeping market measures spearheaded by former Premier Zhu Rongji were introduced after the Asian financial crisis in the late 1990s.
Chinese leaders have acknowledged that three decades of 10 percent average annual GDP expansion are over and that the economy needs fresh drivers, analysts say.
In February, the World Bank said in a report with the cabinet think-tank, endorsed by presumptive-premier Li, that Beijing must implement deep reforms to avert a crisis.
The World Bank said China's annual economic growth may slow to 5 percent a year by 2026-2030, from 8.5 percent in 2011-2015.
The mainstream view in Beijing is to blame the global financial crisis for China's slowdown, which also reflects diminishing gains from past reforms and market opening spurred by China's entry into the World Trade Organisation a decade ago.
resource:http://www.reuters.com/article/2012/10/21/us-china-economy-reforms-idUSBRE89K0GS20121021

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Dollar higher on Chinese banking action

THE Australian dollar is almost half a US cent higher on liquidity action from China's central bank, and ahead of crucial economic news from Spain. 
 
At 12 noon (AEST), the Australian dollar was trading at 103.96 US cents, up from 103.51 cents yesterday.
The local currency fell as low as 103.29 US cents overnight, as the market grew increasingly concerned about the eurozone debt crisis, in the wake of higher bond yields in Spain and rioting in Greece.
Meanwhile, Australian bond futures prices were higher at noon.
The December 10-year bond futures contract was trading at 97.065 (implying a yield of 2.935 per cent), up from 97.035 (2.965 per cent) yesterday.
The December three-year bond futures contract was at 97.640 (2.360 per cent), up from 97.610 (2.390 per cent)

Read more: http://www.news.com.au/business/australian-dollar/a-slightly-higher-despite-euro-troubles/story-fn6t6wad-1226482287009#ixzz27eIkv3JA

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Vodafone has lowest customer satisfaction of all telcos, study reveals

VODAFONE customers just can't get no satisfaction.
The telco took out the top prize for the telco with the lowest customer satisfaction rating in a mobile lifestyle study released this morning.
Less than 50 per cent of Vodafone customers were satisfied with their provider, according to a study released by the Australian Interactive Media Industry Association.
The Australian Mobile Phone Lifestyle Index is an independent study conducted annually by the AIMIA.
Fifty-four per cent of Vodafone customers were not satisfied with the provider, which has been plagued by network issues over the last few years.
That figure represents a 42 per cent drop in customer satisfaction over the past two years.
Vodafone rated an 88 per cent satisfaction rate in the 2010 study and a 61 per cent satisfaction rate in 2011.
The drop in customer satisfaction, therefore, is significant.
The poor customer satisfaction rates follow almost two years of technical problems which caused prolonged network blackouts both for phone calls, text messages and internet access.
The problems were so bad it prompted the company's CEO, Nigel Dews to issue an apology to disappointed customers on Vodafone's blog in December of 2010.
The network problems followed a merger with the 3 Mobile network in 2009.
Dr Marisa Maio Mackay, Director of Complete the Picture Consulting and official research partner for the 2012 report told News Limited that the poor result for Vodafone "really reflected what had been happening in the market".
"It gains momentum," Dr Mackay said. "That probably is influencing the study result because of the significant drop in coverage for some users."
Dr Mackay said the merge with the 3 company and network drop-outs probably didn't help.
Virgin Mobile Australia took out the top satisfaction ratings when it came to smartphone choice, recording an 80 per cent satisfaction rate.
A spokesperson for Vodafone acknowledged that it had let its customers down."
"We know what it takes to be a market leader, and we know we’ve let our customers down," the spokesperson said.
"We are rolling out a range of initiatives to deliver a fantastic customer experience, teamed with our ongoing network improvement program and roll-out of 4G next year, we are confident we will lead the market again in customer experience."
Optus took out second place recording a 67 per cent satisfaction rate.

Read more: http://www.news.com.au/business/companies/vodafone-has-lowest-customer-satisfaction-of-all-telcos-study-reveals/story-fnda1bsz-1226482324963#ixzz27eIIl0oq

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Job vacancies rise 4.2% in August

The number of job vacancies in Australia has risen by 4.2 per cent, ABS statistics show.

THE number of job vacancies in Australia has risen by 4.2 per cent, official statistics show.
The total number of vacancies in August 2012 was 179,300, in seasonally-adjusted terms, compared with 172,100 in May, according to the latest Australian Bureau of Statistics (ABS) quarterly survey released on Thursday.
There were 165,900 private sector job vacancies in August, up 5.9 per cent on May's 156,700.
But the number of public sector vacancies in August, at 13,500, was down 12.9 per cent on August.

Read more: http://www.news.com.au/business/worklife/job-vacancies-rise-42-in-august/story-e6frfm9r-1226482585958#ixzz27e4JdTKh

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European Stocks Rally on Fed Enthusiasm

• 
  Reuters

The Federal Reserve's new plan to stimulate the U.S. economy and progress on tackling the euro zone crisis spurred a strong rally in risk assets on Friday, pushing global stocks to a 13-month high and sending Spanish and Italian bond yields lower.

European equities surged to a 14-month high with London's FTSE, Paris's CAC-40 and Frankfurt's DAX all well up, helping to lift the MSCI index of global stocks to 338.63, its highest level since August last year.

On the bond market, yields on 10-year Italian government bonds fell below five percent for the first time since late March as the Fed's announcement on Thursday compounded the recent improvement in sentiment towards riskier assets.

The Fed's decision to pump $40 billion into the economy each month until the weak U.S. jobs market turns up bolstered the positive mood which has dominated markets since the European Central Bank announced its own plan to cut borrowing costs of struggling euro zone members.

"There is a risk-on mood across the board at the moment, that (has to do with) the Fed but certainly it still echoes from the ECB," Rainer Guntermann, strategist at Commerzbank said.

Euro zone finance ministers were also meeting in Cyprus, hoping to build on progress the bloc has made this month, following the plans announced by ECB President Mario Draghi and a German court's green light this week for the euro zone's new ESM bailout fund.

Spain was being pressed to clarify whether it will seek the financial support which would clear the way for the ECB to buy its bonds. Questions remain whether Madrid could be tempted by the recent drop in its borrowing costs to tough it out without a politically unpopular EU bailout programme.

"I'd like them to set out their position because it hasn't been clear over the summer what their position is," Irish Finance Minister Michael Noonan told reporters, reflecting concern among several euro zone countries that uncertainty over Spain is holding back a recovery from the bloc's debt crisis.

DOLLAR WEAKNESS

On Wall Street, the Standard & Poor's 500 Index had its highest close on Thursday since December 2007 after the Fed's announcement of new bond purchases.

The dollar index measured against a basket of currencies fell to its lowest in over four months at 78.949. The Fed's quantitative easing plan equates to printing money and diluting the value of the currency.

The dollar's broad decline left the euro at a four-month high above $1.30, the latest in a string of technical and psychological levels it has cut through this week.

"With Europe getting their act together (at least temporarily), the Fed flooding the market with cash, and China talking (about) stimulatory infrastructure projects, the three largest influences of market dynamics could be creating a bull market for at least the near term," Neal Gilbert, currency strategist at GFT Forex.

Shanghai commodities futures, from copper to zinc jumped between 3 and 5 percent on hopes the Fed's move would bolster global demand for manufacturing and building materials. Oil moved towards $117 a barrel.

Gold rose to a 6-1/2-month high of $1,777.51 an ounce, leaving in on course for is fourth week of consecutive rises and on top of Thursday's 2 percent gain.

Stimulus measures like those announced by the Fed and ECB tend to give a twin boost for precious metals as they can benefit both from better global demand and their reputation as protection against inflation.

ITALIAN APPETITE

Demand for German government bonds and U.S. treasuries, typically favoured by investors seeking lower risk, extended recent falls.

Ten-year Italian yields fell below 5 percent for the first time since March 26 and were down 6 basis points on the day at 4.97 percent. Equivalent Spanish yields shed 3.5 bps to 5.64 percent.

"Five percent (Italian yield) is certainly eye-catching but the key level from a technical point of view is 4.7 so we still have to be cautious here," said Piet Lammens at KBC in Brussels.

"If it drops below that level I would interpret it as the market basically seeing Draghi's move as a game changer," he said, adding it was also important to see how aggressively the ECB used its new bond buying "bazooka".

Analysts are now wondering whether the positive momentum can be sustained. "In the next weeks or months it is not so easy to see what is going to drive the markets up further," said Heinz-Gerd Sonnenschein at Postbank in Frankfurt.

"The ECB and the Fed have given market participants what they wanted, we have had the positive German court ruling on the ESM so now the fundamentals will be back in focus."

Read more: http://www.foxbusiness.com/markets/2012/09/14/european-stocks-rally-on-fed-enthusiasm/#ixzz26S1aOEy5

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Fueled by Higher Gas Prices, Consumer Inflation Rises

• 
  REUTERS

Consumer prices rose in August by the most in three years as the cost of gasoline jumped, but there was little sign of a pick-up in underlying inflation pressures, which should allow the Federal Reserve to stay on its ultra-easy policy path.

The Consumer Price Index increased 0.6 percent last month after being flat in July, the Labor Department said on Friday. That was the first increase in five months and was slightly above economist's expectations for a 0.5 percent rise.

Gasoline prices, which recorded their largest increase since June 2009, accounted for about 80 percent of the rise in consumer inflation last month.

However, underlying inflation was fairly muted. The core CPI, which excludes food and energy prices, increased 0.1 percent for a second month in a row.

In the 12 months to August overall consumer prices increased 1.7 percent, staying below the Fed's 2 percent target, but advancing from July's 1.4 percent rise.

The U.S. central bank on Thursday launched a third round of bond purchases and extended its pledge to hold interest rates near zero to at least through mid-2015 from late 2014, in an effort to tackle stubbornly high unemployment.

Federal Reserve Chairman Ben Bernanke said he believed inflation would remain close to the Fed's target, noting that longer-term inflation expectations were quite stable.

Last month, overall inflation was boosted by a 9.0 percent surge in gasoline prices after a 0.3 percent rise in July. Gasoline prices at the pump increased 28 cents in August and could squeeze household budgets.

Food prices rose 0.2 percent last month after edging up 0.1 percent the prior month. Prices are expected to rise significantly later this year as the impact of a severe drought, which has caused a spike in corn and soybean prices, works its way through to the supermarket.

Away from gasoline and food, the cost of apparel declined 0.5 percent, breaking five months of gains. New motor vehicle prices gained 0.2 percent after falling 0.1 percent in July.

Prices for used cars and trucks fell 0.9 percent after dropping 0.5 percent the previous month. Housing costs edged up, with owners' equivalent rent rising 0.3 percent, the largest rise since November 2008.

In the 12 months to August, core CPI increased 1.9 percent, the smallest rise since July last year, after advancing 2.1 percent in July.

Read more: http://www.foxbusiness.com/markets/2012/09/14/consumer-inflation-rises-fueled-by-higher-gas-prices/#ixzz26S0uhunp

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Report: US Health System Wastes $750B A Year

WASHINGTON -- The U.S. health care system squanders $750 billion a year _ roughly 30 cents of every medical dollar _ through unneeded care, byzantine paperwork, fraud and other waste, the influential Institute of Medicine said Thursday in a report that ties directly into the presidential campaign.

President Barack Obama and Republican Mitt Romney are accusing each other of trying to slash Medicare and put seniors at risk. But the counter-intuitive finding from the report is that deep cuts are possible without rationing, and a leaner system may even produce better quality.

"Health care in America presents a fundamental paradox," said the report from an 18-member panel of prominent experts, including doctors, business people, and public officials. "The past 50 years have seen an explosion in biomedical knowledge, dramatic innovation in therapies and surgical procedures, and management of conditions that previously were fatal ...

"Yet, American health care is falling short on basic dimensions of quality, outcomes, costs and equity," the report concluded.

If banking worked like health care, ATM transactions would take days, the report said. If home building were like health care, carpenters, electricians and plumbers would work from different blueprints and hardly talk to each other. If shopping were like health care, prices would not be posted and could vary widely within the same store, depending on who was paying.

If airline travel were like health care, individual pilots would be free to design their own preflight safety checks _ or not perform one at all.

How much is $750 billion? The one-year estimate of health care waste is equal to more than ten years of Medicare cuts in Obama's health care law. It's more than the Pentagon budget. It's more than enough to care for the uninsured.

Getting health care costs better controlled is one of the keys to reducing the deficit, the biggest domestic challenge facing the next president. The report did not lay out a policy prescription for Medicare and Medicaid but suggested there's plenty of room for lawmakers to find a path.

Both Obama and Romney agree there has to be a limit to Medicare spending, but they differ on how to get that done. Obama would rely on a powerful board to cut payments to service providers, while gradually changing how hospitals and doctors are paid to reward results instead of volume. Romney would limit the amount of money future retirees can get from the government for medical insurance, relying on the private market to find an efficient solution. Each accuses of the other of jeopardizing the well-being of seniors.

But panel members urged a frank discussion with the public about the value Americans are getting for their health care dollars. As a model, they cited "Choosing Wisely," a campaign launched earlier this year by nine medical societies to challenge the widespread perception that more care is better.
resource:http://insurancenewsnet.com/article.aspx?id=356557&type=breakingnews#.UE87Y_Jic8o

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43 States Take Part In $10M Allianz Settlement

Iowa Insurance Division - September 6, 2012-The Iowa Insurance Division announced that a multi-state settlement agreement has been reached between Allianz Life Insurance Company (Allianz) and 43 States. Iowa acted as the managing lead state in the settlement and was assisted by three other lead states: Minnesota, Missouri and Florida. An additional thirty-nine states have now signed on to the agreement. The agreement establishes corrective actions, a remediation plan and levies a ten million dollar penalty to be distributed among the participating states.

The settlement was a result of a review of company practices related to the sale of fixed annuities by Allianz between the years of 2001 and 2008. Regulators reviewed how Allianz and its insurance producers sold its products, how the products worked and how the products performed. This multi-state settlement is limited to fixed annuities issued from 2001 through 2008.

A corrective action plan will require the company to change the format of its policy annual reports, maintain current company training and monitoring of its agents, change some aspects of its complaint handling, and require conformity with some of the monitoring provisions of the National Association of Insurance Commissioner (NAIC) Replacement Model. The company is required to submit reports to the lead states to confirm its compliance with the agreement.

Allianz is also required to implement a remediation plan to review complaints previously filed by its customers who purchased a fixed annuity between 2001 and 2008. Under the plan, prior complaints will be evaluated according to the standards listed in the settlement. If a complaint is found to be justified, the consumer will be offered retroactive cancellation of their policy, with a full refund of premiums.

Allianz will also accept new complaints from policyholders who purchased a fixed annuity between 2001 and 2008 and who have not yet submitted a complaint. The deadline for new complaints to be filed with the company is March 31, 2013.

The amount of the fine to be received by each of the participating states will vary based on the final number of the states who sign the agreement and the number of affected policies in each participating state. Iowa’s share is expected to be approximately $150,000.

“We’re very pleased to have reached this settlement,” said Iowa’s Insurance Commissioner Susan Voss. “This is a great example of several states jointly and collaboratively taking action to review a company. It will benefit the participating states; allow current customers an opportunity for a review of their individual cases and assure that the practices of the company are or will be in line with the standards established by state regulators.”

Iowans who purchased a fixed annuity from Allianz between 2001 and 2008 who have questions about this settlement or the process of filing a complaint can contact the Iowa Insurance Division at 877-955-1212.

Resource:http://insurancenewsnet.com/article.aspx?id=356565&type=breakingnews#.UE86kPJic8o

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President Tells Tale of Two NAIFAs

LAS VEGAS, September 9, 2012 -The president of NAIFA in his address to the annual conference decried an unhealthy level of distrust and division within the association and called for unity in the face of one of the most challenging times for life insurance and financial advisors.

Robert A. Miller, the 2011-2012 leader of the National Association of Insurance and Financial Advisors, said the animosity is damaging the very base of the federated organization of more than 600 state and local groups comprising 45,000 members.

“We see states vying with locals; locals that are having trouble filling their board positions and suspicious of any unsolicited advice,” Miller said this morning at the Las Vegas annual meeting, according to an advance copy of his speech. “The closing down of under-performing locals has reached epidemic levels, while states unable to afford professional management are on the rise. Some states and locals seem to gather hurricane force energy in stating their enmity toward NAIFA-national.”

Miller put NAIFA’s division in the context of the national schism with deep discord between political parties. But he said that unlike the Democrats and Republicans, NAIFA members should belong to one party in particular.

“No matter what party anyone in this room belongs to, the one party whose bandwagon you better get on is the insurance party,” Miller said, adding an ominous note. “We are one signature from extinction.”

For historical perspective of NAIFA’s impact on public policy, Miller reached back to the group’s early history, when it was the National Association of Life Underwriters (NALU) and advocating for the insurance industry even before World War I. That was 1913, when NALU helped the Woodrow Wilson administration establish the tax benefits on which the industry now depends.

A hundred years later, NAIFA has to continue that struggle.

“In an ironic twist of historical symmetry, in 2013 NAIFA will be fighting to protect our products from a polemically charged Washington looking to pay down its debt,” Miller said. “The tax advantages that insurance products have enjoyed because of their unique nature are at risk. This threat is serious.”

But Miller also sounded hopeful notes as he described the enthusiasm he saw in many members he met in his year traveling for the association.

“As your president, I had the opportunity to experience the best of what NAIFA is all about,” said Miller, who is also a partner at Miller-Pomerantz and Associates in New York City. “I traveled across the country, meeting with members and state and local leaders. Some were experienced veterans of the business; others were young and promising agents. Many inspired me with their energy and enthusiasm.”
resource : http://insurancenewsnet.com/article.aspx?id=356790&type=topnews

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ECB Holds Rates, Draghi Conference in Focus

• 
  Reuters

European Central Bank chief Mario Draghi faces the most decisive moment of his presidency on Thursday when he aims to back up his vow to save the euro with a bond-buying plan - the main focus of a policy meeting where it kept interest rates on hold.

Investors want to hear how the ECB will start the new bond-buying programme to help bring down the borrowing costs of Spain and Italy, after disagreements between bank policymakers over the plan were played out in public last week.

With the bond-buying plan the focus of Thursday's meeting, the ECB Governing Council kept interest rates on hold, leaving its main rate unchanged at 0.75 percent.

"A rate cut would have been understandable given the weak economic data, but clearly the ECB wants to address the main risk first, the convertibility risk, which the ECB will try to attack with a new bond purchase programme, if governments play along," said Stefan Schilbe, chief economist at HSBC Trinkaus.

The euro rose after the rate decision and German benchmark bond prices fell.

Pressure on Draghi intensified after an unsubstantiated German newspaper report that Bundesbank chief Jens Weidmann had considered resigning over his opposition to bond-buying, although several sources say he has made no such threat and believes in staying at the table to argue his case.

Renewed ECB intervention in the euro zone's bond markets is crucial for buying governments time to come up with a longer-term response to the bloc's debt crisis.

Investors are looking for Draghi to flesh out enough details of the plan to back up his promise on July 26 to do "whatever it takes" to preserve the euro when he speaks after the Governing Council meets.

"Expectations are extremely high. If the ECB does not deliver, we will get into another bad patch," said Gilles Moec, senior European economist at Deutsche Bank.

Spanish and Italian government bond yields have fallen significantly since Draghi said on Aug. 2 that the ECB would buy bonds issued by Madrid and Rome.

ECB debt purchases - which would succeed the bank's Securities Markets Programme that has been dormant since March - would only resume under strict conditions and if countries first sought help from the euro zone rescue fund.

Markets have been expecting Draghi to unveil a bold plan after Thursday's policy meeting.

But while he is likely to deliver a framework for new bond purchases, he will give no details of planned amounts or explicit targets for yield spreads or levels of interest rates, two central bank sources told Reuters.

"A number of investors expect that the button will be pushed without further ado, but it is a bit more complicated than that," Deutsche Bank's Moec said.

SECURING MAJORITY SUPPORT

Securing majority support on the Governing Council for a plan that Weidmann can live with represents the trickiest balancing act Draghi has faced since he took over the ECB presidency on Nov. 1 last year.

Weidmann has expressed concern that intervening in the bond market to reduce the borrowing costs of struggling euro zone countries such as Spain and Italy - which had reached levels that were unaffordable in anything but the short term - would break the ECB taboo of financing euro zone member states.

Other ECB policymakers see a greater urgency to help Spain and Italy to prevent the euro zone crisis from deepening.

One of the sources said the ECB is keen to attach strict conditions to its new programme. These will be enforced by the International Monetary Fund - which has a reputation for being tougher than European Union institutions - to keep up the pressure for reform.

The Governing Council would decide on a case-by-case basis and keep close tabs on the programme, one source said, while the other source ruled out a shock-and-awe approach, in which the ECB would start off by buying huge amounts to impress markets.

The ECB was prepared to waive its senior creditor status on bonds it purchased - meaning it would be treated equally with private creditors in case of default.

"There is a problem if central banks insist on the preferred creditor status, because the more the public sector intervenes in the bond market, the less interest private investors will have," said one of the sources, who has seen preparatory documents for the Council meeting.

PRINCIPLES VS FLEXIBILITY

The terms of ECB intervention, which Draghi is expected to lay out when he reports the Council's decisions at a 1230 GMT news conference, will determine whether Spain seeks help.

Prime Minister Mariano Rajoy said on Sunday that Spain, the euro zone's fourth largest economy, would consider seeking extra aid on top of an up to 100 billion euro rescue of its banks, but he wanted to see details of the ECB's programme before deciding.

Asked about ECB bond buying and a conflict of interest between Spain and Germany, Rajoy told Germany's Frankfurter Allgemeine Zeitung: "I understand Germany's concerns and know Germany's economic history ... the risk premium and difference in interest rates are rendering our efforts worthless."

"It is good to have principles in life. But sometimes it is also good to be flexible," he added.

Spain is in recession and a quarter of its workers are out of a job, meaning tax revenue is falling and this is undermining the government's austerity drive.

The Council is expected to broaden the list of securities banks can pledge as collateral at the ECB in return for cash, something that will be particularly important for Spain's ailing banking sector.

Read more: http://www.foxbusiness.com/markets/2012/09/06/ecb-holds-rates-draghi-conference-in-focus/#ixzz25gyskuFL

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UK rises in WEF competitiveness rankings survey

A relatively flexible labour market has helped the UK economy, the WEF says

The UK has risen to eighth from 10th place in an annual study of global competitiveness.

The World Economic Forum's (WEF) survey said the UK had benefited from a more efficient labour market compared with more "rigid" European economies.

The US economy fell from fifth to seventh place, although WEF said it remained the top innovator.

Switzerland topped the table, followed by Singapore and then Finland in the survey of 144 economies.

The ratings are compiled using public data as well as executive opinion.

The survey placed China as the most competitive major emerging economy.

'Innovative businesses'

The WEF said the UK had benefited from "clear strengths such as the efficiency of its labour market" and praised the UK's "sophisticated and innovative businesses".

Global top 10 (previous year in brackets)

1: Switzerland (1)

2: Singapore (3)

3: Finland (4)

4: Sweden (3)

5: Netherlands (7)

6: Germany (6)

7: United States (5)

8: UK (10)

9: Hong Kong (11)

10: Japan (9)

Source: World Economic Forum

However, the body said the country's macroeconomic economic environment - ranked 110th, down from 85th last year - was hindering competitiveness.

The Treasury said it "welcomed" the report, saying the UK's improvement was down to the government's reforms.

The report uses 12 categories to assess a country's ranking: institutions, infrastructure, macroeconomic environment, health and primary education, higher education and training, goods market efficiency, labour market efficiency, financial market development, technological readiness, market size, business sophistication and innovation.

The WEF report comes a day after a separate survey indicated activity in the UK service sector had picked up in August on the back of new contracts, increased marketing and, to a lesser extent, better weather.

Europe's north-south divide

The WEF survey showed a clear divide between Europe's northern countries and the troubled periphery economies which are suffering from recessions.

In total, six European economies are in the top 10 - Switzerland (1st), Finland (3rd), Sweden (4th), the Netherlands (5th), Germany (6th) and the United Kingdom (8th).

But the southern eurozone economies are ranked much lower, with Spain in 36th place, Italy 42nd, Portugal 49th and Greece 96th.

The southern economies, which are at the heart of the eurozone sovereign debt crisis, have suffered a chronic lack of competitiveness and low levels of productivity that led to unsustainable imbalances in the economy, followed by rising unemployment.

The WEF urged an overhaul of labour regulations "sooner than later" as one of the necessary reforms to restore growth.

Switzerland maintained its top position thanks to its scientific institutions, a strong collaboration between academia and business sectors, high spending on research and development as well as its high rate of patenting per capita, the WEF said.

US political gridlock

The US ranking has continued to fall due to weakness in the overall economy as well as worries among businesses towards what they perceive as government meddling in the private sector and distrust towards politicians.

The WEF warned that in the US, despite being the world's top innovator with the likes of Google and Facebook, political gridlock over fiscal tightening could dampen growth prospects.

The survey cited an inefficient government bureaucracy and tax rates as the two biggest impediments to doing business in the US.

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