OECD's Pessimistic Outlook
The Organisation for Economic Co-operation and Development (OECD) issued its new Economic Outlook, and most of its forecasts were based on rising pessimism. That cannot come as a surprise. The organization has watched the financial prospects of the European Union crater, and the looming fiscal cliff threatens any recovery in the United States. The only odd part of the forecast is that it comes so late. The bottom line of the report:
GDP growth across the OECD is projected to match this year's 1.4% in 2013, before gathering momentum to 2.3% for 2014, according to the Outlook.
In the United States, provided the "fiscal cliff" is avoided, GDP growth is projected at 2% in 2013 before rising to 2.8% in 2014. In Japan, GDP is expected to expand by 0.7% in 2013 and 0.8% in 2014. The euro area will remain in recession until early 2013, leading to a mild contraction in GDP of 0.1% next year, before growth picks up to 1.3% in 2014.
One primary cause will be among the most difficult to solve. More than 50 million people in the OECD nations are unemployed, and there is no engine for most countries, which are gripped by slow GDP growth and austerity programs, to change that.
Windows 8 Sales
In a bit of good news for Microsoft Corp. (NASDAQ: MSFT), one of the world's top authorities on software claims that Windows 8 sales have exceeded those of earlier OS Vista over the same number of days from initial launch. The information runs contrary to many impressions about the adoption of Windows 8, most of which suggest that the product is already in trouble. CNET reports:
The conclusion was derived using data from Web-metrics firm Net Applications for October. The new operating system was on 0.45 percent of all computers, which is more than double that of Vista's 0.19 percent. There are, however, a few caveats. As it was launched on the 26th, compared with the 30th (for Vista), Windows 8 had a couple more days to account for. Meanwhile, Vista was introduced in January, which meant that it missed the crucial holiday buying season.
The only bit of bad news is that Windows 8 adoption rates are behind those of Windows 7.
Zynga's Odd Rise
The stock prices Facebook Inc. (NASDAQ: FB) and the game company Zynga (NASDAQ: ZNGA), which has relied on Facebook traffic, have risen in lock-step over the past five days. Each is up 8%, compared to a 2% rise in the S&P 500. The link seems odd, since Zynga's games have gone out of favor, even with the huge distribution platform Facebook offers them. New Zynga games are nowhere near as successful as its big hit, Farmville. Zynga also has run through senior management people. And Facebook has received several analysts upgrades that Zynga has not. Investors believe that the market for social-network games has become crowded, and that this is even more true on mobile devices than personal computers. But Zynga's shares are off from a 52-week high of almost $16 to $2.40. Investors who enjoy risk might believe that, at its current extremely low valuation, it can drop no further.
Douglas A. McIntyre
Filed under: 24/7 Wall St. Wire, Market Open Tagged: FB, featured, MSFT, ZNGA