Weekend Digest: Is The Recession Damage Reversible?

For our weekend business readers:

RECESSION DAMAGE REVERSIBLE SAYS THE FED
“Most of the damage inflicted on the U.S. labor market by the recession is reversible, according to Federal Reserve research, leaving open the possibility that additional stimulus will be effective in reducing joblessness,” quotes Bloomberg in a recent post.

About one-third, or 1.5 percentage points, of the jump in unemployment from 5 percent as the economic slump began to its 10 percent peak in October 2009 can be traced to a mismatch between the supply of labor and job openings, according to a study released this month by the Federal Reserve Bank of New York. That leaves the remainder due mainly to a lack of demand.

But the Bloomberg article points out there is a raging debate among some bankers and economists over whether they believe that to be the case.

“There is a structural unemployment problem in the U.S.,” said UBS economist Drew Matus. “The best the economy can do, even if it is performing well, is an unemployment rate that is probably significantly higher than it was pre-crisis.”

Go inside the Bloomberg story for complete analysis of what the experts think of the Federal Reserve research and what they think it will take to aid recovery.

TRASH AND GROSS DOMESTIC PRODUCT
What does tracking box car loads of trash and the GDP have in common?  A lot says one economist who has come up with an innovative idea and charts to back his theory.

Economist Michael McDonough has worked out the GDP-to-trash indicator and a transcript of an interview he did has been posted by NPR’s Marketplace.

McDonough explains in the interview how tracking-the-trash correlates to the GDP.

That’s what’s great about this indicator. It’s holistic because it’s not isolated to a single part of the economy. It’s people throwing things out, it’s buildings being demolished — it’s everything. The current levels are indicative that you may be seeing a weakness in new construction. So the fact that it is as weak as it is right now means something’s wrong in the economy, potentially, in the underlying economy.

Read the Marketplace interview to find out how McDonough came up with this trash tracking concept as it relates to the health of the economy, and why he calls it a “lagging indicator” rather than a leading one.

CAN SUCCESS BE THIS SIMPLE?
It can, says Forbes writer Mike Maddock in his essay, “Three Incredibly Simple Questions The Most Successful People Use To Change the World.”

Maddock assesses the impact of each question and how he came up with them, but really there’s not much more to set-up about this piece except it’s possibly some of the most powerful advice you may have ever heard whether you are trying to change your industry, your company or your personal life.

Read the entire story here to learn more.

IS EMAIL MARKETING THE MOST COST-EFFECTIVE ADVERTISING METHOD?
Without a doubt, says Arthur Middleton Hughes in his blog for Harvard Business Review and Hughes laments, “In a business world obsessed with gaining more customer intelligence, you would think that email marketing would get more respect.”

His pitch is to give it more respect.

Certainly email beats the competition from a measurability standpoint. With TV you do not know who is watching your ads. Ditto with print. Even with direct mail, you cannot be sure that your mail has been delivered, or that anyone reads it when it gets there. With email, you know within 24 hours exactly which messages have been opened, by whom, what links the openers clicked on, and what part of your message was working.

Review the HBR piece to find out why Hughes thinks email sparks the same type of responses as TV or print advertising and the huge advantage (hint: tracking) email has over other forms of marketing.

DEMAND FOR TOILETS A GLOBAL BOOM
It’s coming and with a flush of entrepreneurship behind it, the toilet business is set to explode especially in the Far East, says Harvard Business Review.

The largest markets will be seen around the axis of India and China, because both countries have huge populations, with a significant share still living in rural areas. India, for instance, expects to see some 350-400 million people becoming urban residents in the next three decades.  That could mean demand for as many as 150 million new toilets.

But can toilet manufacturers possibly keep up with that demand, and what are the alternatives if they don’t?  What are the latest green commode innovations, and how does Bill Gates fit in to all this?

For all the “poop,” click this link.