The Future of Digital Media - No More Physical Copies

The advent of the compact disc (CD), and later the digital versatile disc (DVD) were, at the times of their respective creation, were thought to be the end all and be all of media storage and playback. There have been other types of digital media designed for the mass market such as digital audio tapes (DAT's), mini disc's (MD's) to name but a couple of mediums that were at the time, touted as the next big thing to revolutionize how we stored, listened to and watched our digital media. And now, with the mainstream fully embracing Blu-Ray technology, digital optical media seems to have peaked in terms of capability and usefulness.

If you were to discover that optical media, regardless of whether we're talking about cd's, dvd's or the impossibly awesome blu-ray, had a limited lifespan and in fact may not be the ultimate storage or playback method...well, you'd likely be a bit surprised, shocked, maybe even a bit angry depending on how much money and time you've invested in your media library. Guess what?

Digital media and optical storage methods are, in fact, not built to last forever, despite what you may think based on what you've read or have been told by the salesman who sold you your blu-ray player. Great. All those cases of cd's and dvd's and blu-rays have a finite lifespan attached to them - now what? Wait until the next disc based storage format comes along? Sell off your collections based in anticipation of the next even smaller storage format? Believe it or not, the future is already here and slowly gaining traction in the form of all digital content that you stream from a central location throughout your home.

With the rising popularity of services like Netflix and iTunes, consumers are quickly becoming used to the notion of not actually owning physical copies of their media. It may take some time to wrap your head around the idea of going all digital, after all, having bookcases or closets or racks and racks full of music and movies is impressive to look at and, until recently, the commonplace and accepted method of storage and display.

Being able to back-up and copy all of your optical media to one central location, such as a plug in hard drive attached to your main computer, would instantly eliminate the need for physical copies. The space savings alone are enough of an incentive for many consumers to consider this option. Add in the ability to stream wirelessly to any location in your home or to your portable devices, and the idea of owning physical copies of your music and movies seems downright old fashioned.

If you don't have wireless in your home, there is always an alternative option. By utilizing a media hub or similar device, you can simply unplug your hard drive and connect it to whatever TV screen you choose to use. This method also makes your entire library portable - you could easily take your entire library of music and movies with you wherever you go. Try taking one thousand DVD's anywhere and you'll see the benefit of an all-digital library pretty quickly!

Many of the music or film purists who have large collections will always cite the inability to have cover art as one of the reasons to retain physical copies of films and music. There is some merit to this as cover art is an established and attractive part of the music or film contained within. But many of the media players and all digital storage methods offer the user the ability to attach album covers and movie poster art to their corresponding digital files (*"cover flow" in iTunes is a great example of this), thus allowing you to retain the familiar while utilizing the new methodology.

While blu-ray media is currently in fashion and is considered the end all be all of digital media, the evolution to non-physical copies is happening as we speak. Hard drives are getting bigger and capable of more storage. Streaming media throughout the home is simple enough for the average user to install and calibrate. You may not be quite ready to put your existing media up for sale - that's ok for the time being. You've had a lifelong relationship with your albums and movies. But as your choices increase and more and more films and albums are added to your library, combined with the finite lifespan of optical disc based storage, sooner or later you'll begin to consider going all digital. Whether you make the choice sooner or later, the ease of use, not to mention all of the benefits already discussed here (*think of the space you'll save around the house!), will have you thinking about your library in a whole new way. Embrace the future of digital media.The Future of Digital Media - No More Physical Copies

Mvix offers superior products for a fraction of the cost of comparable full-featured solutions. Our Digital Signage platforms can be scaled to any sized deployment and application.To find out more about our digital signage solutions, visit us online today!

This post was made using the Auto Blogging Software from WebMagnates.org This line will not appear when posts are made after activating the software to full version.

Mobile Is the Future: The Future Is NOW! Pt 12: Limitations of Social Media

There are currently over five hundred million users spending and average of fifty five minutes a day on Facebook around the world. The number of people on Twitter is somewhere between thirty and forty million. Those staggering numbers have caused businesses and corporations to redevelop their marketing strategies to include a Social Media presence. Outside marketing consultants are even charging companies to manage these "free" services. It seems to make sense considering the numbers involved, but those numbers are small in comparison to the number of mobile phones currently in use around the globe which current estimates place at around four billion. The numbers alone should compel businesses to implement some sort of a Mobile strategy, but there are other reasons that Mobile Media is a more effective marketing tool than Social Media.

The first advantage that Mobile Media has over Social Media is the timing of the message delivery. Sure, people spend fifty five minutes a day on Facebook, but they always have their mobile phones. Studies show that ninety-seven percent of all text messages are opened with eighty percent of those being opened within one hour. That means that if you send a text with a lunch special at 10:30 in the morning to five hundred subscribers, four hundred of them will see that special in time for lunch. If you were to put that same special on Facebook, you run the risk of your intended targets not being logged in and missing the offer in time to use it, or even missing it altogether. You could "tweet" it out, but not every person on Twitter has it connected to their mobile phone, and there just aren't that many people using Twitter to begin with. Most Mobile Media platforms also offer a scheduling feature, which allows a business to schedule their messages in advance for up to a year ahead of time. That means the business can set up all of the messages that they want to send out and when they want them sent, and then spend their time focusing on other areas of their business.

The next advantage that Mobile Media has over Social Media is convenience. Since we are always in possession of our mobile phones, it is very easy to just show someone a text message to receive our offer. With Social Media sites, you typically have to print some sort of coupon. That's more paper to carry around that a potential customer can possibly forget. If you think that they should just be able to show the offer on a Smart-phone, keep in mind that only about forty percent of the country is currently using a Smart-phone. If a business were to rely on the use of Smart-phones for their marketing and promotions, they would be excluding sixty percent of the buying public.

Possibly the most important advantage that Mobile Media has over Social Media is in the level of personal engagement. If a business posts a deal through Twitter, that deal is going to get lost among a barrage of "tweets" from Sarah Palin complaining about the President, LeBron James refusing to apologize for being arrogant, and Justin Bieber talking about nothing important. Some people have thousands of friends on Facebook. Their Facebook wall is constantly scrolling, and if a business posts a deal on that wall it will likely just blend into the mix of posts about what someone's cat did that day or what their grandma had for breakfast. But when someone receives a text, whoever sent that text has their attention, if only just for a second. The business and the consumer are instantly and exclusively engaged without the interference of other Facebook friends or self-absorbed pseudo celebrities on Twitter.

Every business should have a presence in Social Media. It is free and can help build the name and reputation of the businesses that utilize it properly. It even works well in conjunction with Mobile Media. But it has its limitations. The timing of delivery, convenience, and levels of engagement are all much greater with Mobile Media when compared to Social Media. It is not recommended that a business outsource the management of its Social Media campaign unless it is part of a broader marketing package. Why pay for something that you can easily do yourself for free? Put that money towards something that will be far more effective for your business, like Mobile Media.

Jeremy T. Roos is an experienced sales expert in several fields and is currently focused on technologically driven marketing solutions for professionals, business, and organizations of all sizes. For more information go to http://www.socalmobileconnect.com or for partnership opportunities go to http://www.westcoastizigg.com.

This post was made using the Auto Blogging Software from WebMagnates.org This line will not appear when posts are made after activating the software to full version.

The Future of Social Media in 2010

Social Media, it's been a topic for more than a few conversations in 2009. From Oprah, to Iran, to Michael Jackson, and Starbucks, this has been the year that social media became mainstream. Quantcast reports that Twitter has grown from 6 million to 24 million from January-October 2009 while FaceBook boasts adding more than 1.5 million new users daily. And the New Oxford American Dictionary unveiled its word of the year in November as, "unfriend." And by unfriend I'm referring to the delicate online etiquette that surrounds the concept of removing someone as an online connection, follower, or friend. If you don't believe me, a quick Google Search resulted in more than 5.7 million online mentions of the word. And until recently it wasn't even considered part of the English language.

It seems clear that 2009 is truly the year of the New Media.

And for those of us who live in this fast paced world we ask, "So what's next?"

According to the Gartner Hype Cycle, the future of social media is Cloud Computing, Internet TV, Virtual Worlds, and possibly a new type of microblogging platform. The Gartner Type Cycle or Curve is the graphic representation of the maturity, adoption, and business application of specific technologies. The actual Gartner Cycle includes five different phases: 1) Technology Trigger, 2) Peak of Inflated Expectations, 3) Trough of Disillusionment, 4) Slope of Enlightenment, and 5) Plateau of Productivity.

Never heard of the Gartner Hype Cycle? The Gartner Hype Cycle is most notably known for being used to predict the dot-come burst in 2001 by Alex Drobik in 1999. Basically, the concept has been around and in some circles is a considerable method in which to predict the future rise and fall of technologies.

Aside from prediction tools like the Gartner Cycle, it doesn't take a scientist to tell you that social media is here to stay. Just like a football game, the fanfare and excitement surrounding social media ebbs and flows in large tides as the excitement and anticipation builds or after a big time play. We are currently experiencing a considerably large amount of attention surrounding social media because of the news and media hype while the influencers move to discover the next big thing. Over the next year, the new media market will being to flatten as it becomes a form of status quo. I do believe, however, that there will be a number of new technologies and strategies that will demand our attention in 2010.


Video. Either live streaming, you tube, or video blogging, video is the new medium in which influencers are using to communicate their brand and message.
Microcommunities. In the last two years, social media has made the world much smaller allowing us access to people regardless of business title or location. We will shift to the opposite side of the spectrum by focusing on our home towns and communities from where we currently reside.
Location Awareness. Your location matters and as microblogging has changed the way we communicate, GPS based applications on our mobile phones will shape how, when, and why we let people know what has your attention.
Focus on Mobile Technology. New mobile technologies outside of the iPhone like the Android will demand our attention. Our thirst for real time news, technology, and information will drive theses tools' popularity.
Internal New Media Platforms. As companies begin to embrace social media as a legitimate business tool, internal social media networks will rise to the forefront. I have already begun seeing businesses including Starbucks and NASA develop internal platforms beyond basic instant messaging tools like Yammer. NASA's internal communication is called "Spacebook."
I'm excited to see what 2010 and social media has in store for us.

Jessica Miller-Merrell, SPHR is a blogger, new mother, and human resources professional with a passion for recruiting and all things social media.

Jessica has over 10 years of experience in human resources and recruiting. She provides businesses with social media and human resources consulting as well as executive recruiting. Jessica has been recently interviewed by Glamour Magazine, Entrepreneur.com, and Employment Digest.

Jessica's upcoming book, Tweet This! Twitter for Business will be released in January 2010 and you can contact her at jessica@xceptionalhr.com.

This post was made using the Auto Blogging Software from WebMagnates.org This line will not appear when posts are made after activating the software to full version.

Why Media Planning Will Become More Important in Your Future Marketing Plans

What's the worst job in Marketing ? Media planning has long been a backwater:  unglamorous, driven by arcane algorithms, and frequently relegated to afterthought status. The Marketing team spends weeks debating and gaining agreement to the annual marketing plan goals, key initiatives, advertising, etc. And then, whoops--almost forgot--we need a media plan ! But, media planning is at the edge of a virtual revolution.

The media changes build on existing trends to more performance based Advertising Agency compensation models by Procter & Gamble, Coke and others. Reach, frequency and gross rating points are now giving way to a world where program and ad impact have as much currency as impressions. GRP's as we've known them will become relics. What's driving the change?

Exploding Digital

It's obvious but needs restating: the marketing world is moving from a TV centric model to a web centric model. The brand web site is becoming an increasingly important platform for engaging both prospects and customers. Social and other web-based media options continue to grow and evolve at an accelerating pace:  forums, webcasts, podcasts, blogs, Twitter, webinars, etc. Spending is shifting on-line as well. And more digital means more measurable. Click thru, site visits and conversion rates are only the beginning as marketers become increasingly sophisticated with digital measurement. All this means that future media plans will be more creative, complex and measurable. A good guide to this area is "The Online Advertising Playbook: Proven Strategies and Tested Tactics From the ARF."

Program and Ad Impact Innovation

Advertisers have long done pre-market testing of ads.  But with the advent of very large web-based consumer panels like Nielsen IAG, companies have the ability to measure consumer engagement with individual programs. No longer does a basic demographic define the media buy. Two programs with the same demographics could have vastly different consumer engagement. Are consumers more engaged with "The Office" or "Lost" ? Now we know. And this means that the same ad performs better in some programs than others, based on program fit and viewer engagement. Is your ad more effective in "The Biggest Loser" or "American Idol"? Now we know.

Mike Kleha, Director of Media & Metrics at Merck and Co. says:  "IAG's data allows us to go beyond the rating point, and gives us a deeper insight into the mind of the consumer. This allows us to do a better job of targeting our messages to where they will be more effective and provide the most consumer value."  Simple demographic driven media plans will no longer suffice. CMO's will demand media plans that take into account both quantity and quality.

Creative & Media Integration Trends

Big advertisers like Unilever are increasingly going directly to media companies even before creative development with a set of objectives and asking them to create an integrated plan which helps deliver the brand objectives. This "reverse upfront" media planning process is designed to keep costs low and better integrate creative and media buying. Media companies will increasingly develop a media plan concept that matches the brands objective, and this in turn will drive both creative and usage of the full gamut of TV, digital, mobile, interactive, in-program placement, etc.

This new media landscape demands new constructs and new skills, as in surveys CMO's say they are nowhere close to realizing the opportunity in new media.  GRP's and TRP's will need to evolve to measures which incorporate both quantity and quality--something like  ERP's:  Effective Ratings Points. Marketing organizations will need new capabilities to negotiate this increasingly complex world. Welcome to Marketing in the brave new media world--a place where you ignore the heightened role of media planning at your peril.

Randall Beard (http://randallbeard.wordpress.com/) is a senior Marketing and Product Management executive with over 25 years of global experience across consumer packaged goods, financial services and high-touch service brands, including Procter & Gamble, American Express, and UBS Wealth Management. His expertise is in building and turning around ailing brands, building stronger organizations, and improving profitability during times of crisis and growth. He has a reputation for delivering results thru vision, disciplined strategic focus, product, marketing and customer experience innovation, and people enablement. In sum: Randall is all about "Marketing with Impact."

Randall has worked and built business and teams in virtually every major market in the world, including USA, Canada, China, India, Hong Kong, Singapore, Australia, Japan, Taiwan, Korea, UK, Switzerland, Germany, France, Spain, Italy, Russia, Mexico, Argentina, and Brazil.

Randall currently serves on the Advisory Boards of University of Virginia Darden Graduate School of Business, CityExplorer TV, a privately held company whose TV networks provide an insider's guide to the greatest cities of the world, the UBS Art Collection Advisory Board, and the CMO Council.

This post was made using the Auto Blogging Software from WebMagnates.org This line will not appear when posts are made after activating the software to full version.

Digital Media Player Coming to Your Living Room - Future Home Entertainment Now

Just a few years ago, home entertainment had an entirely different meaning than it does now. In fact, the first home entertainment system was the family radio, where you would sit around as a family and listen to shows that were broadcast. The choices were somewhat limited. Now we are entering an age where our entire lives will be digital, including our home and how we entertain ourselves while in our homes. Now, houses come built with a theater room that can be completely set up with video and sound to mimic that of an actual theater, thus providing a monumental home entertainment experience.

This article will examine just how far the idea of home entertainment has come and now, how the idea of media delivery is transitioning from an actual piece of media, like a compact disc, DVD, and even the new Bluray, into a completely different animal, streaming media.

Traditional Home Entertainment Ideas

Just to rewind a little in order to appreciate the newest and hottest technology that is out, I'd like to just point out some of the older forms of home entertainment. I'm going to skip from the early radio and TV eras into the origins of actually setting up an entertainment hub in the home. Partly this is because of the introduction of the television in the home. Before the television, families were forced to basically invent ways to entertain themselves. If we could go back in time, to the 50's lets say, and show a family a modern day home with a fully decked out theater room, can you imagine their reaction! We've evolved from books and board games, which I still enjoy, to radio, to TV, to fully stocked theaters in our houses.

Origins Of The Home Theater

The original home theaters usually consisted of an oversized cathode ray tube television set, a couch, maybe a recliner, and there weren't too many options for sound other than the speakers on the television set. The main source of media would have been delivered from over-the-air signals, then from cable (if you could afford it), and also from your home VHS or BETA player. This set-up probably describes most dens or home living rooms from the middle 80's through the middle 90's. Several companies saw the potential of the living room as a major source for revenue. Sony, KLH, JVC, AIWA, and Yamaha electronics companies were some of the pioneers in the home theater market that started to produce products specifically marketed for creating your own home theater in your house. The latest two editions to the home entertainment room are the DVD player, which replaced the VHS, and now the Sony Bluray players. There was a brief war between Sony and Toshiba for High Definition format superiority, but Sony's Bluray Player won that war.

Now a home theater room can come fully equipped with oversized plasma televisions, LED televisions, and gigantic movie screens with accompanying 1080p video projectors suspended from the ceiling. That old sofa has been replaced with specialized seating that included media room recliners and sectional sofa recliner combination furniture, all to enhance the viewing experience. Not to leave out the sound, you can now have your audio delivered in up to 7.1 channels of crystal clear sound. You can hear the bullets whizzing by your head, don't forget to duck! Now the home theater is headed for an all new destination, an all new digital destination and you can get there wirelessly.

Your Living Room And Streaming Media Players

The whole idea of having a DVD tower in the living room and picking a movie, and plugging it into a DVD player of some sort is rapidly dying. The digital media player is taking over what was once the homes of the DVD and now the Bluray players on the shelf under the television. The first real media streamer came from Netflix, when they offered a set top box that allowed the user to have access to thousands of movies, streamed over the internet directly to your TV, and you could view the movies in high definition. Then Microsoft started to offer different content downloads through the Xbox. Sony also eased into this market through the PlayStation 3, by making some games and movies downloadable, as well as add on content.

The idea has been there for the past few years, but only until this year have we seen a major boom in media HD Media players, digital media adapters, and digital media receivers. It really has been just a matter of time. People have been storing their own home movies and music on their computers for years, and as the home theater room evolved, so did the consumers' need to be able to access their media content not only in the living room or entertaining room, but now that need has grown to be able to access content in every room of the house. The demand has become even greater for the HD media player with the ability to back up personal DVD collections on your own PC. Now whole movie collections are stored on terabyte drives and can be accessed with these digital media players. As an example, The Patriot Box Office HD, with the wireless adapter, can connect wirelessly to your home network router and give you access to your media content. It outputs video at 1080p TrueHD and also outputs Dolby Digital sound. These digital media streamers not only play content from your network, but also support services such as YouTube, Google Video, Yeoh, and Hulu.

Upcoming Thoughts

In the next few years, it is my theory that over 80% of the content that we view in our home entertainment rooms and living rooms will be streamed over the internet directly to us. If television manufacturers want to keep pace, I think that eventually the televisions will come with built in media streamers and the ability to communicate wirelessly with home networks. As the ability to transfer information wirelessly gets faster and faster, I think we will see jumps in entertainment technology. The industries of Cable and Broadcast media will take the biggest hits in the next few years also, just like the music industry in the early 2000's. This time I think we could see some companies just go under or change. They will have to change the way they deliver media to their customers, because if the service gets too far behind the demand, consumers will always find a way to get what they want.

About The Author:

Mitchell Pierce invites you to please visit the Digital Media Player Hub site today to find this article and more on digital media players. For more articles and free information regarding digital media players as well as links to where to get great deals at Digital Media Player Review.

(C) Copyright - Mitchell Pierce, Digital Media Player Guide - All Rights Reserved Worldwide.

This post was made using the Auto Blogging Software from WebMagnates.org This line will not appear when posts are made after activating the software to full version.

Future Jobs in Advertising Will Be Dominated by Media - Polish Up Your Media Resume!

Jobs in the advertising industry declined during the recession of 2008-2010, but now appear to be increasing again. Looking at the advertising jobs of the future, we believe media will dominate job growth. Available jobs will involve media planning, buying, and sales for both traditional and new media. Integrated communications will be key.

In terms of job opportunities, there are three basic functions which media professionals perform to connect ad messages with target markets: media planning, buying, and sales. To prepare for an advertising job, job seekers should develop a good understanding of media planning, media buying, and media sales for both traditional and digital media. (The future is integrated marketing and media.)

1. Media Planning

Media planning is the process of developing an effective media strategy and action plan involving use of both traditional and digital media.

The planning process first begins with an analysis of the marketing situation. Then, second, based on marketing priorities, media objectives are formulated that detail exactly what the media plan is supposed to accomplish, for example, including the definition and prioritization of target audiences the media plan must reach.

Third,strategies are formulated which will most effectively accomplish the media objectives. Finally, based on the media strategies, a detailed tactical plan is developed.

The media strategy and action plan incorporate the right media classes, the right media vehicles, the right geographic markets, the right timing, the right budget, the right number of advertising exposures, in the right media contexts, and so on. In so doing, media planning contemplates how traditional, digital, alternative, and marketing services media can help best address marketing problems or capitalize on marketing opportunities.

The end result of the process is a media plan, often called the tactical plan. The media plan details the recommendations and detailed rationale for all media activities and spending. For example, the plan may propose the use of magazines as the important medium for some particular advertising. The recommendation would include how much money should be spent in magazines vs. other media, in which months or weeks ads should be scheduled, and, of course, which specific magazines are most cost effective and best meet the magazine selection criteria.

Of course, media plans must also include other proposed media/marketing activities such as geographic market areas which should receive supplemental media spending, how often the consumer should be reached with advertising, as well as how the advertising should be scheduled throughout the year or planning period.

A media planner is someone who develops or supervises the development of media plans through a rigorous media planning process. The media planner may occupy any level in the organization; responsibility, not title, defines the job.

Now, imagine that you are a media planner. You have $3 million to market your product to male beer drinkers. An analysis of media alternatives for reaching this audience suggests these three potential strategies.

1. If you bought one:30 spot in the Super Bowl for $3 million, you would reach almost 33% of male beer drinkers all at the same time.

2. If you bought fifteen:30 spots on male-oriented, primetime, network TV programs, you could reach 65% of male beer drinkers more than once with 35% of them reached at least twice.

3. If you spent half your budget for display ads on male-oriented websites and the other half in men's magazines, you would reach 63% of males twice each, on average, but in different media contexts.

Question: Which option would you choose? Why?

2. Media Buying

Media buying is the second type of job available in advertising and the advertising media area. People who buy media are simply called media buyers. Media buyers may be generalists or may specialize in buying specific media: broadcast or print or digital.

After the media plan has been approved by the client, the media included in the plan must be purchased from the media sellers. Buying is the process of identifying the preferred media vehicles, then negotiating with selling media to reach a satisfactory price and other important terms and conditions. The transaction is called a media buy, and the person who negotiated the transaction with the seller is called a media buyer.

Typically included in the list of negotiable items are price, additional time or space units, positioning of the ad or commercial within the media vehicle, inclusion of higher quality and more effective media vehicles, and value added features such as billboards (broadcast), turnkey promotions, merchandising assistance, programs to involve sales force and customers, and so on.

You might be a buyer with a budget and instructions to buy a specific display ad on the home page of a major search engine, for example. You find that the budget is sufficient to buy an ad on the home page of either AOL or Yahoo but not both. You therefore ask each of the sellers to submit a proposal, and you negotiate with both of them until one offers you desirable inventory at an acceptable price. After negotiating with the sellers, you may then select the seller with the lowest price or the best additional enticements. When you have completed the transaction, you have done a media buy!

3. Media Sales

Media sales or selling is the third category of advertising media jobs. All media have sales people who work on the local level selling to local businesses or on the national level selling to national advertisers and advertising agencies. In addition, opportunities exist in media representative firms who often represent media companies in the key markets of the countryt. For example a television station in Hoboken may hire rep firms to do their selling in New York, Chicago, Los Angeles, San Francisco, and Detroit -- or where ever.

What is important here is that media sales will likely be the largest employer of people in the advertising industry, and could be considered by those who have interest in advertising, professional selling and has accrued a little bit of experience in the agency business.

If you were the media seller for AOL in the example above, you might propose a media package consisting of X number of clicks to AOL for the one-time-only price of $5 million. But the Yahoo sales rep would be doing the same thing! Your job would be to come up with an offer better than Yahoo's, including a final price and any other terms and conditions that would induce the media buyer to keep negotiating with you until you can reach a contract.

Media sales persons are usually called media representatives or sales reps. Sales reps may work for the medium (e.g., AOL) or for an independent firm that represents several non-competing media. Sellers communicate with buyers by phone, face-to-face in person or video conference, by mail and e-mail.

Ronald D. Geskey CEO, 2020:MarketingCommunications LLC and author of "Media Planning & Buying in the 21st Century." marketing2020@aol.com

"Media Buying & Planning in the 21st Century" is an excellent primer for those looking for a job in advertising or advertising media. The book discusses many career opportunities which will help readers better understand the advertising and media business so that they can pursue media job opportunities more intelligently. The book covers topics from a practical "how to" standpoint, and unlike many media books, explains issues in plain English.

The author, Ron Geskey has over 30 years of experience at major advertising agencies. He has a B.S. and M.S. from Southern Illinois University, doctoral work at Texas Tech University, and Executive Education at Wharton School of Business, Northwestern University, Michigan State University

Websites: http://www.21stCenturyMediaPlanning.com - http://www.MediaPlanningBuyinginthe21stCentury.com

This post was made using the Auto Blogging Software from WebMagnates.org This line will not appear when posts are made after activating the software to full version.

Google, Facebook, Linked in : The Future Of Search

TechCrunch has once again made a prophecy of Facebook having a Google Killer, this time in search. Is FB at all interested or geared up to meet the challenge of search?

Generated by BlogIt

BlogIt - Auto Blogging Software for YOU!

Laika the Space Dog Wins the Future, or: President Sets a Price-Level Target in a Depression, FDR 1933 Edition

I’ve been following up on this important David Beckworth post on QE and monetary policy done by FDR in the Great Depression. Beckworth argues that the first QE policy was during the Great Depression, and it benefitted from the fact that Roosevelt explicitly says they will do what it takes to get the pre-trend price-level target.  He links to this Gauti Eggertsson paper that argues that when Franklin Roosevelt took office, Roosevelt signaled that they’d get the price-level back to pre-Depression trend by going off the gold standard, creating a Federal government created through deficit spending and explicitly stating target levels for prices, and this expectation change from Hoover did a lot of the work of recovery.

I wasn’t sure how serious to take this – a President talking about price levels to the public? Sure enough, here’s the second Fireside Chat, May 7th 1933 (Transcript, my bold):

Much has been said of late about Federal finances and inflation, the gold standard, etc. Let me make the facts very simple and my policy very clear. In the first place, Government credit and Government currency are really one and the same thing. Behind Government bonds there is only a promise to pay…in the past the Government has agreed to redeem nearly thirty billions of its debts and its currency in gold, and private corporations in this country have agreed to redeem another sixty or seventy billions of securities and mortgages in gold…knew full well that all of the gold in the United States amounted to only between three and four billions and that all of the gold in all of the world amounted to only about eleven billions.

If the holders of these promises to pay started in to demand gold the first comers would get gold for a few days and they would amount to about one-twenty-fifth of the holders of the securities and the currency…We have decided to treat all twenty-five in the same way in the interest of justice and the exercise of the constitutional powers of this Government. We have placed everyone on the same basis in order that the general good may be preserved.

The Administration has the definite objective of raising commodity prices to such an extent that those who have borrowed money will, on the average, be able to repay that money in the same kind of dollar which they borrowed. We do not seek to let them get such a cheap dollar that they will be able to pay back a great deal less than they borrowed. In other words, we seek to correct a wrong and not to create another wrong in the opposite direction. That is why powers are being given to the Administration to provide, if necessary, for an enlargement of credit, in order to correct the existing wrong. These powers will be used when, as, and if it may be necessary to accomplish the purpose.

We discussed most of that blockquote dealing with gold clauses here and here, where FDR told rentiers who had put suicide-pact clauses in their contracts, clauses that allowed them to collect more gold that existed in the world as a way to allow private parties to profit while the country suffered and was immiserated in a deflationary spiral, that he was going to come at them like a spider-monkey.  Beyond establishing credibility and changing expectations, reading it makes me happy, to see a President so actively go after broken, destructive contractual schemes that prevent the management of bad debts and threaten the general good.  But there’s the bold quote, stating where the final goal of monetary policy is at the beginning of his administration.

Economic and monetary policy commentators like Ryan Avent have noted that ”The Fed chose a direction rather than a destination” when it has come to QE and monetary policy.  If Avent wants to see a destination mentioned by a sitting President, he should check out FDR’s fourth fireside chat on October 22, 1933 (my bold):

Finally, I repeat what I have said on many occasions, that ever since last March the definite policy of the Government has been to restore commodity price levels. The object has been the attainment of such a level as will enable agriculture and industry once more to give work to the unemployed. It has been to make possible the payment of public and private debts more nearly at the price level at which they were incurred. It has been gradually to restore a balance in the price structure so that farmers may exchange their products for the products of industry on a fairer exchange basis. It has been and is also the purpose to prevent prices from rising beyond the point necessary to attain these ends. The permanent welfare and security of every class of our people ultimately depends on our attainment of these purposes…

Some people are putting the cart before the horse. They want a permanent revaluation of the dollar first. It is the Government’s policy to restore the price level first. I would not know, and no one else could tell, just what the permanent valuation of the dollar will be. To guess at a permanent gold valuation now would certainly require later changes caused by later facts.

When we have restored the price level, we shall seek to establish and maintain a dollar which will not change its purchasing and debt paying power during the succeeding generation. I said that in my message to the American delegation in London last July. And I say it now once more.

Two thoughts:

1.  Wouldn’t it be funny if in this fireside chat, years into a sub-trend growth and massive waste from high unemployment and unused capacity, Roosevelt said something like “someday, 25 years from now, Russia might be able to get a space dog into orbit before us.  In order to Win the Future against this space dog, we should immediately forget everything going on right now in order to pivot to preparing for research competition with potential adversaries decades from now.  We must immediately start planning for this battle right now, lest we lose the future, so let’s give a bunch of tax holidays and easily captured credit benefits to various rocket manufacturers and other incumbents” as a response?  That would be crazy.  I’m glad he was really serious about using every pressure point and every lever to get monetary and fiscal policies going instead.

2.  Obviously back then the Democratic coalition had a lot of farmers in it, people for whom “the price level” wasn’t a graph they pulled from the St. Louis Fed to put on their blog but a real thing that they dealt with daily.   There is a chance that insomuch as hipsters are an influential Democratic coalition group, and hipsters begin to engage in urban farming, “the price level” might become more of a thing that Democrats are responsive of in order to meet the needs of urban hipster gardeners.  Until then, it’s up to economic bloggers to carry this message.

Generated by BlogIt

BlogIt - Auto Blogging Software for YOU!