What passes for business reporting in the United States is too often a series of breathless reports about the stock market. When the Dow rises precipitously, as it did today (Wednesday), the business press predicts an end to the Great Recession. When the stock market plummets, as it did last week, the Great Recession is said to be worsening.
Pay no attention. The stock market has as much to do with the real economy as the weather has to do with geology. Day by day there's no relationship at all. Over time, weather and geology interact but the results aren't evident for many years. The biggest impact of the weather is on peoples' moods, as are the daily ups and downs of the market.
The real economy is jobs and paychecks, what people buy and what they sell. And the real economy -- even viewed from a worldwide perspective -- is as precarious as ever, perhaps more so.
Today's rally was triggered by news that one of China's official measures of its growth -- its Purchasing Managers Index -- rose. The index had been in decline for three straight months.
Why should an obscure measurement on the other side of the world cause stock markets in New York, London, and Frankfurt to rally? Because China is so large and its needs seemingly limitless that its growth has been about the only reliable source of global demand.
Many big American companies have been showing profits because they're doing ever more business in China while cutting payrolls at home. American consumers aren't buying much of anything because they've lost their jobs or are worried about losing them, and are still trying to get out from under a huge debt load (the latest figures show more consumer debt delinquent now than last year and a surge in personal bankruptcies). The U.S. housing market is growing worse, auto and retail sales are dropping, and the ranks of the jobless continue to swell.
Europe is in almost as much a mess. The problem there isn't just or even mainly that Greece and other nations on the "periphery" have too much public debt. A bigger problem is European consumers aren't buying nearly enough to generate more jobs. Unemployment remains high, and the trend is bad. Manufacturing growth there has slowed to its weakest pace in six months. Yet bizarrely, Europe's large economies -- Britain, Germany, and France -- are paring back their public budgets. It's exactly the wrong time, and a recipe for disaster.
Germany's so-called "job miracle" (as Chancellor Angela Merkel calls it) is more mirage than miracle. Most of the gains in employment there have come from part-time jobs, often at low pay. Average annual net income per German employee continues to drop. This explains why domestic demand there is so sluggish and why Germany is desperately dependent on its exports of machinery and manufacturing components to Asia, especially China.
Meanwhile, Japan, now the world's third-largest economy, is a basket case. Japanese consumers aren't buying much of anything, and why would they? The country is still in the grip of a deflationary cycle that shows no end. Japanese consumers reason if they can buy it cheaper next week there's no reason to buy now. Basically the only thing keeping Japan's economy going are its exports of cars and electronic components to China.
Australia is booming, but look closely and you see the same buyer. Australia is making a boatload of money selling its minerals and raw materials to China (Australia is fast becoming one big Chinese mine shaft). The Brazilian economy is soaring. Why? Exports of wheat and cattle to China. Middle East oil producers are getting richer. Why? China's insatiable thirst for oil.
Elsewhere around the globe the picture is as uncertain. Much of Pakistan is under water. Much of the rest of the Middle East is under tyrannical or corrupt regimes. Russia has suffered such a dry spell it's hoarding wheat. Despite its wealthy few, India's masses are still terribly poor.
The stock market could plunge tomorrow or the next day because the world's economic fundamentals are so precarious.
The global economy cannot be sustained by one big, voracious nation -- especially one that's suffering bouts of civil unrest, actively repressing dissent, suffocating under a blanket of pollution and coping with other environmental hazards, and whose biggest companies are run by the state.
This post originally appeared at RobertReich.org.
It was last November that we first heard about Chomp, a sort-of Yelp for iPhone apps. At the time, it was still very much in stealth mode, but we kept hearing they raised a seed round of funding from investors like Ron Conway insanely fast. Obviously, we were interested.
By January, we had a sneak peak at the actual service. And about a week later, it formally launched as an app recommendation engine for Apple’s App Store. Another larger round of funding quickly followed, and since then Chomp has been off and running with over 400,000 active users at this point. But now it’s time to take things to the next level — with search.
App discovery in the App Store still basically sucks. There’s the main page which Apple’s curates (and does a nice job with). But beyond that it’s pretty much a nightmare. Discovery is continually under attack by developers trying to game the system by putting bogus words in their titles. And with over 250,000 iPhone apps out there now, there simply needs to be a better way to find the best ones.
Of course, that’s what Chomp has been doing. But up until now, they’ve basically only been doing it based on recommendations from your social graph on Chomp. Yes, there has been some basic search functionality, but it has been no better than the one Apple provides (again, pretty lousy). Today brings the launch of a completely revamped search engine for apps. And notably, it’s in both the Chomp app and on chomp.com.
Co-founder Ben Keighran calls this latest version of Chomp “the most personalized way to search and browse for apps.” He notes that the addition of topic-based search is going to change the way people discover apps. “Imagine having to to go Google and search for ‘www.facebook.com’ — rather than just searching for ‘social network’ and having Facebook come up as a result,” is how he puts it.
Competitors like Appsfire are out there also doing search, but they’re also mainly title (and description) based. In Keighran’s mind, this isn’t enough.
He notes that previously beyond simple name searches results would show up based on popularity of the app. While this isn’t the worst way of doing it, Keighran believes the 50 million recommendations that users have already seeded into Chomp will provide a much better way. “We have a lot of data to build a semantic search engine,” Keighran notes. “We have our own Chomp user sentiment.“
He also notes that they have more reviews in many cases than Apple itself does on apps. The reason is that Chomp makes it very easy to do a review — you say whether you hate the app or love it. And if you want, you can leave a 60-word comment.
Keighran also says that Chomp’s system is better than Apple’s own Genius feature for apps because that’s simply based around what you’ve downloaded. This is all about what people you trust enough to add to your social graph have downloaded and love.
All of this points towards Chomp’s larger goals: to be the place people go to find the best apps no matter what platform they’re on. Currently, Chomp only works for native iPhone apps and web apps for the iPhone, but Android and iPad app search/recommendation is in the works.
Keighran sees a future where apps are everywhere, and people need a single place to find the best of them. Yes, kind of like Google for the web. “This is like the web in 1996,” he says. If this future is realized, he envisions Chomp as having 10 million users by the end of next year. A lofty goal, but perhaps not an insane one.
And if they can get to that size, Keighran sees a lot of money to be made. Sponsored search and recommendations will be a huge business — again, at scale. For now, Chomp is making a small amount of money via affiliate fees from Apple every time someone buys an app by way of Chomp.
So what does Apple think about Chomp one-upping them in app discovery? “Apple is insanely excited about this,” Keighran says. Undoubtedly Google is excited for Chomp to come to Android too. Because this is a very real problem across all platforms and one that’s only growing in size.
eric seiger
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