1 Japan launches ‘third arrow’ of reforms (Phillip Inman in The Guardian) Japanese prime minister Shinzo Abe has outlined his long-awaited growth strategy spearheaded by promises of expanded childcare to bring more women into the workforce and an investment boom. Abe said his “third arrow” of reforms would revitalise the economy and restore the country’s global competitiveness.
Abe has already fired his first two “arrows” since taking office 18 moths ago, pushing through a series of spending cuts and tax rises coupled with hiring a new central bank governor with a mission to cut interest rates and drive down the exchange rate. But critics described the latest measures as resembling a dart more than an arrow with few of the more than 230 proposals likely to take effect, or have the desired impact, given resistance to change in Japan’s business world and bureaucracy.
Among the most important of the reform measures is a cut to the corporate tax to below 30% from the current level of over 35%, promised for next year. To counter labour shortages due to the aging population and low birthrate, it also includes measures to promote greater gender equality and greater use of foreign labour and robots. It also calls for looser restrictions on white-collar overtime.
2 US home sales at six year high (BBC) Sales of new US homes surged to a six-year high in May suggesting the housing market is beginning to recover from its recent slowdown. Sales increased by 18.6% to a seasonally adjusted annual sales rate of 504,000 – the highest level since May 2008, according to the Commerce Department. However, the S&P/Case-Shiller index, also released on Tuesday, found house prices increases slowed in April.
A combination of higher mortgage rates and a surge in prices due to a lack of properties available for sale have weighed on the US housing market since the second half of 2013. However, recent data suggests the housing market is beginning to improve again.
A report on Monday showed sales of previously owned homes, the largest part of the US housing market, recorded their largest increase in more than three-and-a-half years in May.
3 An Arabic Vietnam (Eric S Margolis in Khaleej Times) Back in 2002-2003, over 80 per cent of Americans believed the big lies spread by the Bush administration and its neo-con allies that Iraq had nuclear weapons and was behind 9/11 and Osama bin Laden. This writer was one of the first journalists to say on TV that Iraq had no weapons of mass destruction and no ties to Al Qaeda.
President Barack Obama had the wisdom to pull most US forces out of Iraq, though at least 5,000-7,000 military personnel remain in civilian attire in the vast US embassy complex in Baghdad and two major air bases. Hundreds more Americans remain, running Iraq’s oil industry.
Saddam Hussein nationalised Iraq’s oil and kicked out its foreign owners. As soon as he was deposed, the US and other foreign oil firms moved back in to pump Iraq’s black gold. As Cheney said, Iraq was invaded for the sake of “Israel and oil.” Now, Obama faces an awesome decision. As Baghdad’s army wavers before extremists’ assaults, he is under pressure to use US airpower to blunt the Baathist advance. Obama knows that America must not be seen as the champion of Iraq’s one sect against the minority.
Few remember that the Iraq War cost over $1 trillion, all financed by loans from China and Japan. Those neo-cons baying for war have not so far offered to make personal contributions. Or that Vietnam also began with small numbers of US “advisors.”
4 Tweets, likes don’t translate into buys (Kirsten V Brown in San Francisco Chronicle) Back in March, the San Francisco food delivery startup Eat24 staged a “breakup” with Facebook. The company had poured $1 million into Facebook advertising in 2013 alone and picked up more than 70,000 fans, but it wasn’t clear the investment was really getting anything. A new survey from Gallup confirms what Eat24 learned by trial: Social media just doesn’t hold much sway over consumer decision making.
US companies spent $5.1 billion on social media advertising in 2013. Those efforts, though, may be in vain. “Social media are not the powerful and persuasive marketing force many companies hoped they would be,” concludes Gallup, which released the research as part of its State of the American Consumer report.
Of the more than 18,000 American consumers polled, 62 percent said social media had no influence on their buying decisions. Just 5 percent said it had a significant influence. Already some brands are shifting gears, viewing places like Facebook and Twitter as a medium for conversation with customers who are already fans, rather than a place to push brand awareness.