just when I think about it, yeah someone else did it--web searches as leading indicators

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• BUSINESS TECHNOLOGY
• MARCH 5, 2010, 10:50 P.M. ET

Studies of Web Searches Offer Preview of Hiring Trends

By JENNIFER MERRITT

Payroll and unemployment data released Friday offered a snapshot of the labor market's health last month. But some researchers say they can get a read on such trends days or weeks ahead of the official numbers by studying Google searches, tweets and even queries at an online phone directory.

Economists painted a mostly positive picture of the latest government data, which showed the economy shed fewer jobs than expected in February and the jobless rate held steady. For people who look at early-warning indicators, the figures were no surprise. The Web-based data have been telling a similar story for at least a month: The job market is getting better—very slowly.

Development of the new techniques is still in its early stages, but researchers say the data could become a part of the traditional forecasting models—or replace some outdated predictive surveys and statistics.

Economists who analyze the job market using more conventional techniques are already paying attention. "The great benefit is that these [data] show people actually doing something," said Ed Leamer, director of Anderson Forecast, an independent economic-forecasting group at the University of California, Los Angeles.

Still, Mr. Leamer and others don't yet use such indicators in their official forecasts because the tools haven't been around long enough to prove their worth.

Beyond that, the habits and makeup of people who use the Internet are in flux, which can make it difficult to isolate the economic message sent by searches and comments.

A study of daily Twitter activity conducted for The Wall Street Journal by Crimson Hexagon, a firm that builds algorithms to look for key phrases that are indicative of consumer mood, shows a gradual decline in the number of people tweeting about being unemployed and looking for work over the six months ending Feb. 16. The study picked up tweets with phrases like "still looking for a new job" or "I just had an interview." The company also sees a gradual decline in those worried about losing their job in the past two months.

Hal Varian, who left a teaching post at the University of California, Berkeley, to become chief economist at Google Inc., conducted an analysis of searches using a Google tracking function called Insights that pointed to the trend in initial claims for unemployment benefits seven days before the government released them.

The same tool showed more Web searches were conducted over the past two months for "job interview questions" and "what to wear to an interview," phrases that likely mark the beginning of the hiring process. And Google can pinpoint the geographic areas producing the most searches. People typing in Minnesota, for instance, increased searches for job interview questions and answers more than any other state between late October and mid-February.

"I think of it as taking the pulse of the economy," said Mr. Varian, whose team is exploring whether Google wants to get further into forecasting. "We think [the data] definitely have predictive power."

Yellowbook.com, an online phone directory, has devised an indicator based on the types of businesses consumers search for the most. Yellowbook.com says an upturn in searches related to home improvement and remodeling began in October, presaging a fourth-quarter rise in such sales. In late January, Home Depot and Lowe's reported increased fourth-quarter sales.

Researchers also are looking to search patterns for clues to other aspects of the economy. Erik Brynjolfsson, of Massachusetts Institute of Technology's Sloan School of Management, has used Google search volume to forecast home sales. Mr. Brynjolfsson predicted two months in advance that National Association of Realtors' reading of home-sales volume would rise 6.4% in the third quarter, compared with a forecast of 8% by the NAR. The actual rise: 6.1%.

Write to Jennifer Merritt at jennifer.merritt@wsj.com

Copyright 2009 Dow Jones & Company, Inc. All Rights Reserved

global defense spending (US #1, China #2, Russia #3...)

U.S. Defense Spending vs. Global Defense Spending

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by Travis Sharp [contact information]

February 26, 2009

The United States is far and away the global leader in defense spending. In 2007, the most recent year for which complete data is available, the United States approved $660 billion in defense budget authority (FY09 dollars). This figure includes funding for DOD’s base budget, DOE-administered nuclear weapons activities, and supplemental appropriations for Iraq and Afghanistan.

• With its budget of $660 billion, the United States spent more on defense in 2007 than the next 14 highest spending countries in the world combined.
• The United States accounted for 43% of the world’s total defense spending in 2007.
• In 2007, the United States spent 4.6 times more on defense than China, 7.7 times more than Russia, 85.2 times more than Iran, and 100 times more than North Korea.

From 2005 to 2007, annual U.S. defense spending increased by $95 billion after adjusting for inflation. While this increase was greater in dollar terms than the annual defense budget of every country in the world except China, in percentage terms it only totaled 17% because the U.S. budget was relatively massive. The United States may spend far more on defense than any other country in the world, but it does not have the fastest growing defense budget in the world. That distinction belongs to Kazakhstan, which saw its defense budget increase by 84% from 2005 to 2007 after adjusting for inflation. (Table 6 below)

Press reports indicate that while some countries plan to rein in their defense spending in 2009 due to the sagging global economy, others will continue to increase their annual defense expenditures. Russian officials said in February 2009 that Moscow plans to submit an official 2009 budget of approximately $33 billion, a 15% cut from 2008. However, Russia still plans to spend $111 billion between 2009 and 2011 to purchase new weapons and modernize its armed forces. China has not yet announced its 2009 defense budget plans, but its official 2008 budget grew by 17.6% from the previous year. (Russia and China’s official figures significantly understate spending, as explained in the note on methodology below). India announced its intention to increase its defense budget in 2009 by 34% over the previous year’s level.

Table 5. Defense Spending by Countries of Interest, 2007
(in billions of constant FY09 U.S. dollars; U.S. figure includes war & nuclear funding)

Country	2007 Spending	Global Rank
United States	660.0	1
China	144.5	2
Russia	85.3	3
United Kingdom	65.8	4
France	63.1	5
Germany	43.8	6
Japan	42.7	7
Italy	39.3	8
Saudi Arabia	36.9	9
South Korea	27.6	10
Israel	12.1	17
Taiwan	10.0	20
Iran	7.7	23
North Korea	6.6	28
Pakistan	4.7	33
Venezuela	2.9	49

Table/Chart Notes: U.S. figure includes funding for wars and nuclear weapons. North Korea figure is estimate from U.S. State Department. Data from Congressional Research Service, Office of Management and Budget, International Institute for Strategic Studies, State Department

Table 6. Countries with Fastest Growing Defense Spending Between 2005 and 2007
(real growth adjusted for inflation; U.S. figure includes war & nuclear funding)

Country	Real Growth, 2005-2007	Global Rank
Kazakhstan	84%	1
Angola	80%	2
Ukraine	57%	3
Jordan	57%	4
Slovakia	55%	5
Thailand	51%	6
Austria	50%	7
Brazil	46%	8
Romania	45%	9
Indonesia	42%	10
Russia	33%	13
China	27%	19
United States	17%	28
France	8%	44
United Kingdom	5%	50
Germany	4%	51

Table Notes: U.S. figure includes funding for wars and nuclear weapons. Data from Congressional Research Service, Office of Management and Budget, International Institute for Strategic Studies.

A NOTE ON METHODOLOGY

Estimating other countries’ military spending is no easy task. Besides the complications involved in comparing different currencies, there is no such thing as an agreed-upon international definition for “defense expenditure.” Many countries count spending differently. Transparency is also an issue because some countries may not want the international community to know exactly how much they spend on defense.

The analysis above uses data from The Military Balance 2009, the authoritative reference almanac produced annually by the International Institute for Strategic Studies. A few words are needed on the defense spending estimates for China and Russia. Both of these countries regularly underreport their annual military budgets. The Military Balance 2009 typically uses market exchange rates to convert countries’ defense spending figures into U.S. dollars. In the case of China and Russia, however, the market exchange rates fail to fully reflect the purchasing power of the yuan and the ruble, respectively. To compensate for this, The Military Balance 2009 uses a methodology known as Purchasing Power Parity (PPP) to calculate a more balanced figure. With the exception of the 2007 figure for China, all of the figures for China and Russia in the analysis above use PPP figures, which are significantly higher than both officially reported and market exchange rate figures. The 2007 figure for China uses the high-end estimate provided by DOD in its annual report on China’s military power because a PPP figure is not included in The Military Balance 2009.

The bottom line is that this analysis uses the highest possible defense spending estimates for China and Russia. This is a departure from the methodology utilized in previous versions of this analysis.

Travis Sharp 202-546-0795 ext. 2105 tsharp@armscontrolcenter.org

Travis Sharp is the Military Policy Analyst at the Center for Arms Control and Non-Proliferation. He has published articles on defense policy in scholarly journals, internet magazines, and local newspapers, and has appeared on or been quoted in media venues such as the New York Times, Washington Post, Boston Globe, CNN, and Al Jazeera.