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Macro Chatter: Food gets pricier in China

Around the world today in business and economics. Need to know, want to know, and strange but true.
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Chinese shoppers select pork at a supermarket in Hefei, east China's Anhui province on April 9, 2012. China's inflation rate edged up in March, driven by rising food costs but analysts said there was still scope for Beijing to stimulate the slowing economy. (STR/AFP/Getty Images)

Need to know:

It's getting more expensive to eat in China.

Rising food prices continued to drive Chinese inflation in March. Inflation in China was up 3.6 percent on an annual basis in March as Chinese consumers spent more on meals, Reuters said.

Rising food prices have already helped China oust the US to become the world’s largest grocery market.

Want to know:

While times are tough in Europe, the Irish are looking to the land down under for economic opportunity.

More Irish jobseekers moved to Australia than to the US or UK in 2010, and for good reason: Australia is desperate for labor. The country is looking for thousands of people for construction, mining and services jobs.

Since unemployment is still rising in the UK and jobs are still scarce in the US, Australia might just be the new Irish dream.

Dull but important:

Last week’s disappointing US jobs report is already stirring up talk of more easing from the Fed.

While most of the US central bank doesn’t really want to go there, Fed Chairman Ben Bernanke’s latest speech may have gotten a few people’s hopes up.

Most economists aren’t expecting the US central bank to start up another bond buying spree anytime soon, but a few more bad jobs reports could change that. Bernanke speaks again today.

Just Because:

The New York Times on Sunday pointed out that the US has been a laggard when it comes to cutting the penny out of its budget.

Canada last month became the latest country to kill off its penny. New Zealand, Australia, Brazil, Finland, Norway, Sweden and the UK already have gotten rid of their pennies.

The US, meanwhile, spends 2.4 cents on each penny it makes. That amounted to a loss of more than $60 million in 2011, the Times said.

Strange but true:

There’s a whole lot of extra natural gas floating around the US.


China surpasses US to become world's largest grocery market

China is now the world's top grocery market. The US has slipped to the No. 2 position.
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Customers shop at a supermarket in Zouping in northeast China's Shandong province on October 14, 2011. China in 2011 surpassed the US to become the world's largest grocery market, according to the Institute for Grocery Distribution. (STR/AFP/Getty Images)
China is now the world’s biggest market for groceries. And it’s only going to get bigger, according to the London-based Institute of Grocery Distribution, which tracks the details of the international grocery business. Rising wages and a growing middle class are helping fuel China’s appetite for groceries.

The World Bank, American ego, and what's right for the world

Joseph Stiglitz makes a powerful case. As usual.
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A photo of Jim Yong Kim, president of Dartmouth College. (Dartmouth College./Courtesy)

Here's an iron-clad rule of the global economy:

When you've won the Nobel Prize for economics, your words about economic policy carry more weight.

So in that spirit, you should check out this piece today in Slate by Joseph Stiglitz, who expertly deconstructs the absurd debate over who should run the World Bank, while demolishing the underlying arrogance of US policy in this area.

First, the background:

President Barack Obama has nominated Dartmouth president Jim Yong Kim for the job.

Kim is a fine choice, and has the important global experience of running the World Health Organization’s HIV/AIDS department.

But in a move that reflects the growing economic and political clout of the rest of planet earth, the World Bank's eleven executive directors from emerging and developing countries put forward two other candidates to challenge Obama and Kim:

Ngozi Okonjo-Iweala of Nigeria and Jose Antonio Ocampo of Colombia.

And here's where Stiglitz pounces:

"I have worked closely with both of them. Both are first-rate, have served as ministers with multiple portfolios, have performed admirably in top positions in multilateral organizations, and have the diplomatic skills and professional competence to do an outstanding job. They understand finance and economics, the bread and butter of the World Bank, and have a network of connections to leverage the bank’s effectiveness."

So, the argument naturally flows, either one of these candidates would be a better World Bank chief that Kim.

The problem, of course, is politics. The United States and Europe controll the bulk of World Bank votes, and they've struck a deal. 

The United States has traditionally reserved the right to name the head of the World Bank, and yes, always gives the job to an American like Kim. 

Europe, meanwhile, gets to pick the head of the International Monetary Fund, and yes, that always goes to a European (like current IMF chief Christine Lagarde of France).

That arrangement, coincidentally, leaves out key emerging economies like India, Russia, Brazil, China, and, yes, Nigeria and Colombia.

Moreover as Stiglitz points out, this year's US presidential election makes the current World Bank debate even more political.

After all, what red-blooded American leader would cede control of this important global institution to a — gasp! — foreigner?

But our man Stiglitz has an answer for that, too:


Auto sales in March: Detroit roars again

US auto sales are surging. Hooray for high gas prices!
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A Ford Focus on the assembly line at Ford Motor Co.'s Michigan Assembly Plant December 14, 2011 in Wayne, Michigan. (Bill Pugliano/Getty Images)

Two weeks ago at the Society of Business Editors and Writers annual conference in Indianapolis, I heard Ford's marketing chief James Farley say something interesting.

When it comes to sales in the US, "Fuel economy and perception of fuel economy is key," Farley said.

The latest auto sales numbers are clearly backing up that statement.

Both Ford and Chrysler report that sales in March rose to their highest level in at least four years.

General Motors, too, saw a big jump last month.


iPad news: The Apple obsession

Apple, Apple, everywhere.
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Apple CEO Tim Cook unveils the new iPad on March 7, 2012 in San Francisco, California. (Kevork Djansezian/AFP/Getty Images)

Yes, I'm a big fan of Apple products.

I love my iPad.

I love my iPhone.

I love my old MacBook Pro.

Blah, blah, blah.

But this story today in the very good Bits blog in the New York Times got me wondering:

Has the world gone mad?

The post — written by Nick Bilton and accurately titled "Does the iPad Have One Button Too Many?" — comes to the following conclusion:

Although I love the design of the new iPad, the bezeled edge seems a bit overkill for a company so obsessed with understatement. If Apple lopped off the home button, it would allow the company to make a device that was considerably smaller, without affecting the size of its beautiful screen. Even if Apple were to keep a slight bezel on the edge of the device so our inconsiderate fingers did not obscure the screen, Apple could still shave almost an inch and a half from the top and bottom of the iPad.

You know you've made it as a company and cultural force when one of the world's most important news sources is as obsessive about your product — or perhaps even more so — than the product's actual designers.

Of course, what do I know?

The story is now sitting at the top of the New York Times' Most Viewed queue.

In other Apple News (again from the Grey Lady), check out this thoughtful analysis of the company's sprawling and often-troubled Asian supply chain, written by Nick Wingfield and published April 1.

In it, Wingfield dissects Apple's new approach towards Chinese labor, as evidenced by Apple CEO Tim Cook's trip to China last week.

The money quote:

Apple’s supply chain is a subject much closer to Mr. Cook than it was to his predecessor. Not long after Mr. Jobs returned to lead Apple in 1997, he hired Mr. Cook to clean up the manufacturing operations, which were in disarray, with bloated inventory that hurt its profits. Over more than a decade, Mr. Cook helped transform Apple’s operations into the envy of the electronics industry, with an array of partners, mostly in Asia, able to efficiently pump out its latest products.

Wingfield also artfully points out that Cook spent time in his career working in factories in Alabama and North Carolina, a detail that further sets Apple's new boss apart from his legendary predecessor Steve Jobs.

Good stuff.

And full disclosure:


What's Apple CEO Tim Cook doing in China?

There are plenty of good reasons for Apple's leader to be visiting this key country.
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Apple CEO Tim Cook speaks during the iPhone announcement January 11, 2011 in New York City. (Chris Hondros/Getty Images)

So just how important is China to Apple?

Let us count the ways:

  • China is Apple's second-biggest market after the US
  • The company sold 4 million iPads there last year according to the Wall Street Journal, and demand for its iPhone 4 has been "staggering"
  • Apple has six successful retail stores in China (two in Beijing, two in Shanghai, one in Hong Kong and one in Sanlitun)
  • Much of its supply chain is based here (hello Foxconn), and the company is under increasing scrutiny about how these workers are treated
  • Apple is being sued by Chinese company Proview International Holdings for the right to use the iPad name in China

And, of course, China is the world's fastest-growing market for a lot of things, including the kinds of consumer electronics that have made Apple the world's hottest brand and most valuable company. 

So it's a pretty good time for Apple CEO Tim Cook to do what Steve Jobs never did: make an official visit to China as the chief executive of the company.

On Cook's agenda: meeting with Chinese government officials.

According to Beijing Daily newspaper, Cook met Monday with Beijing Mayor Guo Jinlong.

Guo reportedly told Cook that he hoped Apple would “further deepen cooperation, to achieve better development,” according to the report, which was cited today by Bloomberg.

Apple also apparently plans to make a "greater investment" in China, though the company's Beijing spokesperson didn't give further details.

Of course, Apple is also important to China.


Open season on Occupy Wall Street?

The gloves are off. At least on TV.
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A man who identified himself as Brendan Watts is seen with blood on his face while surrounded by three police officers in Zuccotti Park on November 17, 2011, in New York City. A fight broke out between protesters affiliated with Occupy Wall Street and police, in which Watts was injured. (Andrew Burton/AFP/Getty Images)

So is it okay to make fun of Occupy Wall Street now?

That's the provocative and interesting question the DealBook blog is asking today.

It's easy to see why, after viewing this commercial for Interactive Brokers.

Here's how DealBook puts it:

The commercial, which has been shown repeatedly on CNBC, adopts the imagery of Zuccotti Park to hawk Interactive Brokers’ trading services, and ends with the tagline: “Join The One Percent.”

And here's the actual clip, which signals a different and much more aggressive tone than what we were hearing from most on Wall Street just a few short months ago:

The spot, with its odd stick figures and cheesy music, isn't likely to win a CLIO Award anytime soon.

But it does raise an interesting question about the current public perceptions of the Occupy movement, and the important issue of economic inequality that's sure to be a theme of the upcoming presidential election.


Viral Video of the Day: Vytautas Mineral Water

Lithuania cracks the viral marketing code. All it takes is a little insanity. Okay, a lot of insanity.
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It's earth's juice! (Screen grab/GlobalPost)

Yes, I'm a few days behind on this story.

Life is busy and I've got lots of things to do here at GlobalPost.

Blah, blah, blah.

But I can't let this video go without passing it along to those who may have missed it.


Because it's insane.

And because it's working, brilliantly, for Vytautas Mineral Water, which is apparently a Lithuanian company that's peddling water in plastic bottles.

But one thing is certain: whoever made this video knows what they're doing when it comes to marketing on the web.

First, please enjoy this clip, which has been viewed more than 1.1 million times since last week and features an approach that defies description:

So, why has this particular marketing video gone viral?

There's no good answer, of course, though getting a big shout out from Tosh.0 certainly doesn't hurt, not to mention plenty of link love from Reddit, Huffington Post, Viralviralvideos.com and thousands of other sites. 

But for those companies looking to replicate the success, we can draw some conclusions based on the content of the ad:

  • Scream loudly and consistently when delivering your marketing message
  • Mention both bird and fish poop
  • Use cats and giant magnets
  • Show sexually deviant pandas
  • Make unsubstantiated claims about your product's powers
  • Make fun of other country's food
  • Feature boobs and cheese
  • Employ lots of profanity

So how stressed is the financial system?

Now there's a chart to see just how everyone is feeling out there.
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Madeline Wilson from the National Gallery of Victoria mimics the scream from Edvard Munch's famous hand-coloured lithograph version of 'The Scream.' (William West/AFP/Getty Images)

As everyone knows, there's been plenty of stress in the financial system since 2008 and the global financial and economic crisis.

But thanks to the Federal Reserve Bank of Cleveland (hooray for freshwater economists!) we've now got a graph to prove it.

The dependable bank has put together something called the Cleveland Financial Stress Index, which constantly monitors stress levels in an easy-to-digest graphic format.


VIDEO: Will the real Mitt Romney please stand up?

For those who like their political analysis in easy-to-digest rap form.

Boom, boom, boom.