The Federal Debt Ceiling set limits on deficit spending for the Federal Government and some estimate that the US will reach its deficit spending limits by Spring 2011. The Obama administration argues that the Congress needs to raise the debt ceiling or risk defaulting on government loans. The Republicans state that they want to cut government spending at a time when economic recovery need fiscal stimulus.

Any default on government loans would shake world confidence in US Treasury bonds and the US Dollar and the result would be 12 to 17% interest rates similar to the 1970s. The easier but more insidious route would be to expand the M3 money supply. In 1980, M3 ranged around $1.8 trillion US. In 2010, the M3 expanded to $14 trillion US or a 700% plus increase in our money supply.

We’ll hear mixed messages from economists. Some worry about deflation as occurred during the Great Depression. In our fractional reserve system, banks magically create money when they create loan ledgers. When you deposit $1000 into Wells Fargo at 3%, your bank can turn around and loan $10,000 (10 times the cash reserve holding requirements) at 24% in the form of a credit card loan. When debtors start defaulting on promises to pay, it can snowball into credit compression and cause deflation. With the collapse of our credit markets, we see huge deflationary pressures.   Ben Bernanke, renown for his speech about dropping money from helicopters to stop deflation, believes that we need to print our way out of deflation.

As a result of current FED monetary policy to combat deflation by expanding the M3 money supply, I believe we’ll see rampart inflation similar or worse than the 1970s. During inflation, the depreciation of the value our money gives the price of real estate, commodities, oil, gold, silver and other hard assets the appearance of skyrocketing valuations.  Inflation benefits debtors and harms creditors.

THE PROS AND CONS OF BUYING REAL ESTATE IN 2011

CONS
1. The market has not bottomed. In Washington State, capitalization rate trends show that the income from rents point to an overvaluation of real estate prices. I believe the market will bottom out around 2014 or 2015.
2. If market values continue to fall, it would be a risky time to invest in capital gains strategies such as flipping houses, fixing up houses, or other short term strategies.

PROS
1. Interest rates will never be this low in a very, very long time. If either we default on our government loans, if the US dollar value collapses or the if US keeps expanding our Federal Debt Ceiling, the results of these scenarios all point to 12 to 17% interest rates during this decade.
2. It’s a great time to purchase cash flow properties because inflation will cause home values and rents to increase in the next 7 to 9 years AND decreases the real cost of borrowed money. Because the banks now have strict income requirement verifications, you’ll need very high incomes or cash flow to get a 20% down payment loan on a cash flow property. You will have to search very hard for a good cash flow property because homes are still overvalued.
3. Land values have bottomed out. It’s now possible to purchase a lot of land for $50,000. This is a rock bottom price because it costs around $40,000 to build the entitlements (permits, zoning, utilities, land usage, etc.) for the land. With capitalization rates around 6% in the Greater Seattle Area, you’ll earn a higher return on investment now by purchasing land and building an apartment building than buying an existing apartment.

If you believe my 2011 Inflation Analysis above, holding dollars or investing in mutual funds/stock would be the worse investment you could ever  make. For smaller investors, you may want to consider purchasing some silver bullion or purchase commodities such as oil.  For cash rich investors, the best investment now is purchasing land at rock-bottom prices and building in two years for high capitalization rates and cash-on-cash returns.

For a no-nonsense Realtor who will give really help you with your real estate investments, please contact me at 206.832.9590.

Only a small percentage of people come to any website to buy.   If thats the case, why worry about conversion rates.

If you improve your conversion rate experience, you are not inherently improving the web experience for all of your customers.   Many people visit your website to learn about your company, research your product offerings, and customer support.

Its better to focus on Task Completion By Primary Purpose than Conversion Rates.   Higher conversion rates will result naturally when you improve your task completion rates.

Search Engines attempt to figure out what your website is about.   Here are some tips on optimizing your website and making it easier for the Search Engine bots to understand your site.

Metatags, Meta Keywords and Descriptions.  Today’s search engines now can figure out if you stuff your site with meta tags and key words that are irrelevant to your actual content.   Metatags have lost their weight in page-ranking algorithms.  Don’t stuff keywords, stuff hidden texts, or use misleading 302 redirects.

HTML Page Titles.  Very valuable to search engines.

Text and Image Formatting (Text Types and Alt Tags).  Make judicious use of heading tags and bold text when using your most relevant keywords and content descriptors on the page.

Page Content.  Search engines simply grab all the content on a page and use pattern matching and scoring attributes to apply ranking.   Don’t put valuable content on Secure pages like HTPPS pages.

XML Sitemaps.  Make it easier for crawlers to index your website.

Limit Javscript Wrappers. Crawling spiders don’t executive Javascript so be careful about using Javascript wrappers around links (such as pop-ups).

• Tag all of your pages.
• Place tags last.
• Place tags inline as tag placements affect your data accuracy.
• Use cookies intelligently.
• Identify your unique page definition.
• Consider link-coding issues.
• Be aware of redirects.
• Validate that the data is being completely captured correctly.
• Correctly encode rich web experiences.

Valuable Data

• Where do visitors come from?
• What search engines and keywords drive traffic to your site?
• What content or pages were your visitors interested in?
• What percent of traffic goes to your web page?
• Are you placing your best content on your most visited pages?
• What are your bounce rates?

Unnecessary Data

• Number of visitors
• Number of repeat visitors
• Number of pages viewed

Track Absolute Unique Visitors. Make sure your web analytics software is tracking Absolute Unique Visitors (# of unique cookie_ids for a period of time) and not Visits (# of sessions for a period of time).

Only Use First-Party Cookies And Measure Cookie Rejection Rates. Internet Explorer 7 and Spyware programs erase most third-party cookies and even some first-party cookies.   Keep in mind that if your visitors don’t accept first-party or third-party cookies, they become unique visitors with every request to your web serve by default.   Track the Cookie Rejection Rates over time.

Document Your URL Parameters. Make sure your web analytics solution correctly tracks your URL parameters.

Understand The Inaccuracies Of Time On Site Data. Time On Site only measures the start of session time until you click on another page.   For blogs where all the content sits on the home page, the data becomes incredible inaccurate.  Factor out all of your single-page visits and last page visits to get more accurate data.  In addition, add Bounce Rate analysis to your Time On Site data

Find Out What Defines A Unique Page View. With the emergence of rich media experiences that only count as one page view, Page View data becomes very unreliable.

• Write Excellent And Relevant Content. With all of the noise on the Internet, content must valuable and engaging to your audience.
• Integrating Multiple Marketing Channels. Compare your Cost Per Lead (CPA) across multiple channels and adjust your marketing mix accordingly.
• Continually Improve Your Keywords. Be creative with new keyword ideas and continually improve through trial and error and testing through metrics.  Find high value, low-cost keywords.
• Metrics Analysis. You need to analyze keyword impressions, average position, keyword click through rate (CTR), visitors, visitor CTRs, page views, conversions, number of return visits, lifetime value of each visitor, and landing page bounce rates.   Most importantly, you’ll need to know cost per lead, cost of sales, and return on advertising spent (ROAS)

Google Analytics became free when Google purchased Urchin in 2005 and it quickly became the most popular web analytics tool on the internet.  With Analytics you can view:

• Page Views
• Visits and Pages/Visit
• Top Exit Pages and Bounce Rates
• Referring sources
• Visitor IP Address and Location
• Average Time on Site

Analytics allow you to track visitor behavior, but they do not tell if a website is profitable or “why” your customers did not purchase on your website.   You’ll need to also assess key performance indicators (KPIs) to track outcomes and key insight analysis (KIA) to track experience.

Facebook Paid Advertising differs from other pay-per-click (PPC) or pay-per-impression (PPM) campaigns because it adds a viral dimension to your marketing.   On Facebook, more Fans means more reactions, feedbacks, comments, and friend referrals.   Facebook demographics naturally must match your target audience and you’ll only find out by testing your Facebook Advertising campaign against other forms of online advertising.

Target Marketing. Facebook allows you to target your market geographically by city or state, by age ranges, by genders, by education levels, by specific workplaces, by relationship status, and by language.

A/B Multi-Variant Testing on Facebook. Facebook knows that most marketers like to test advertising content against each other and provides a feature called  ”Copy An Existing Ad.”  The old ad automatically serves as a control group to your new ad.

Facebook Interface. Don’t rely on Facebook Metrics for your campaign as they do not provide you with time-series data analysis to optimize your results.   It also does not allow you to compare cost-per-action (breakdowns that compare budget to traffic data) with other marketing channels.

Analyze Data With Moving Averages In An Excel Sheet. Daily data may have spikes that distort your data.  With the statistical tools of 7 DMA (Day Moving Average) and 28 DMA, your data becomes a lot easier to understand.

A Zempower consultant with years of SMM and Web Analytics Experience becomes invaluable in your quest.   Let’s focus on elements that you will want to incorporate into your SMM campaign.

Diverse and Strategic Tags Across Your Website. Your marketing people need granular, accurate and reliable data to capture a wide range of visitor behaviors.  In addition, you need to capture the data reliable for later analysis.   An analytics tag must be attached to the social media assets, which will require deploying a third-party cookie on the user’s machine.

Key Performance Indicators (KPIs). What metrics will be used to access the success of your campaign?   Choices include total sales, average order value, session per visitor, and percentage of incoming traffic from Twitter.

Performance Targets And Analytics Reports. Determine performance targets by comparing to past campaigns, industry averages, competitive benchmarking and forecasts.  Track Analytics Reports including display columns, metrics, filters, segments, time spans, reoccurence, and report distribution.

Key Insights Analysis (KIA). Unfortunately, clickstream data and key performance indicators (KPIs) do not provide all of data needed to make insightful decisions as they don’t track customer motivations and intentions.   KIAs include click density analysis such as heat mapping data, phone interviews, surveys, website test labs, and multichannel analysis.

Kaizen. Kaizen means continuous improvement in Japanese.   All SMM must continually track, better integrate with other marketing vehicles, assess, innovate and evolve.