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<ul><li><keyword id="3518161" type="General" weightage="20" keywordseo="koo" source="Orion">Koo</keyword> has spent 65% of its total Facebook ad spends transactions in the last 90 days.</li><li>The company aims to close 2021 with 100 million users registered to the platform, Koo co-founder said.</li><li>Koo currently has over 14 million app downloads, a 10x increase since September last year.</li></ul>Social media app Koo started with a big bang, garnering interest from users, investors and in some cases even government officials. The company sprung up in March 2020 as Twitter’s Indian alternative and started gaining momentum in June last year, as relations between Twitter and the Indian government started straining. After 18 months, 14 million downloads and $34 million (₹255 crore) in fundraising, Koo is now splurging on Facebook ads to get more users on board and take on Twitter that has <a href="https://www.statista.com/statistics/242606/number-of-active-twitter-users-in-selected-countries/">22 million</a> users in India. The company has spent a little over ₹2.4 crore on Facebook ads in the last 90 days, according to <a href="https://www.facebook.com/ads/library/?active_status=all&amp;ad_type=political_and_issue_ads&amp;country=IN&amp;view_all_page_id=101044114877636&amp;search_type=page&amp;media_type=all">Facebook Ad Library</a>. That’s ₹80 lakh a month and ₹2.6 lakh a day, making Koo the top spender on Facebook in the last three months. These ads were run across Facebook-owned platforms like Facebook, Instagram, Messenger and its audience network. Interestingly, this is 65% of the total marketing expense (₹3.7 crore) Koo has made on the Facebook app since its inception in March 2020. It seems to be working because the Koo app was downloaded over 3.3 million times between July 8 to October 5, as per App Annie report accessed by Business Insider. <table style="border-width: initial; border-style: none;" class="redcator-table-advance"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Timeline </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Ad spent </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">App Downloads </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">March 2020-October 5, 2021 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹3.78 crore </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">14.3 million </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Last 90 days (July 8-October 5, 2021) </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹2.4 crore </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">3.3 million </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Last 30 days (September 6 - October 5, 2021) </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹78 lakh </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">1 million </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Last 7 days (September 29 - October 5, 2021) </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹12.7 lakh </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">230,000 </td></tr></tbody><tbody></tbody><tbody></tbody></table> The app was downloaded 3.5 million times between July 1 to October 5, which is 5 lakh lower than April to June quarter. Please note that not all these downloads were generated through ads, some of them maybe organic as well. <div type="image" title="Koo is spending ₹2.6 lakh a day on Facebook to beat Twitter" msid="86868782" hostid="261"></div> Koo was co-founded by Aprameya Radhakrishna and Mayank Bidawatka, who previously founded a Q&amp;A platform Vokal. The company wa founded to enable Indian users to converse freely in their local languages, which is not that widespread on Twitter. Koo currently has over 1.43 crore (or 14 million) downloads on its app, as per the App Annie analysis. This represents over 10 times increase from 17 lakh (1.7 million) downloads in September last year. The company, however, has set up higher targets for itself. “Our objective is to be extremely inclusive as a product and as a philosophy, so that every Indian is comfortable voicing their opinions. We want to get to 250 million users a month. We want to reach 100 million users by the end of the year, and I am as confident as an entrepreneur can be that we will reach there,”<a href="https://www.businessinsider.in/advertising/ad-tech/article/i-am-confident-we-will-get-to-100-million-users-by-the-end-of-this-year-mayank-bidawatka-koo/articleshow/81210997.cms"> Bidawatka told</a> Business Insider earlier in February this year. As a part of its strategy, Koo is available in 10 local languages — Hindi, English, Assamese, Gujarati, Kannada, Tamil and Telugu, among others. It plans to add 15 more languages to its platform to attract more customers. The company is backed by the who's who of the tech world including Tiger Global, Mirae Asset Capital, Coinbase’s former chief technology officer (CTO) Balaji S. Srinivasan, Ashish Hemrajani of BookMyShow, Vivekananda Hallekere of Bounce and Zerodha’s Nikhil Kamath. Koo is currently available in India as well as Nigeria, which banned Twitter earlier this year. Some prominent Indian personalities using Koo app are Bollywood actor Kangana Ranaut and Uttar Pradesh Chief Minister Yogi Adityanath. SEE ALSO <a href="https://www.businessinsider.in/business/corporates/news/tata-sons-buy-air-india-for-2-39-billion-from-the-indian-government/articleshow/86867529.cms">Tata Sons buys ‘Maharaja’ for $2.39 billion from the Indian government</a> <a href="https://www.businessinsider.in/business/telecom/news/airtel-announces-cashback-of-6000-free-one-time-screen-replacement-on-purchase-of-new-devices/articleshow/86865821.cms">Airtel announces cashback of ₹6,000, free one-time screen replacement on purchase of new devices</a> <a href="https://www.businessinsider.in/stock-market/news/tata-motors-titan-ongc-bandhan-bank-and-bosch-stand-out-this-week-with-over-10-rallies/slidelist/86866914.cms">Tata Motors, Titan, ONGC, Bandhan Bank and Bosch stand out this week with over 10% rallies</a>

Koo is spending ₹2.6 lakh a day on Facebook to beat Twitter

<ul><li><keyword id="3518161" type="General" weightage="20" keywordseo="koo" source="Orion">Koo</keyword> spent over ₹1.5 crore across 285 ads on Facebook and Instagram between February 15 and May 15.</li><li>Bharatiya Janata Party (BJP) Uttar Pradesh (UP) was the second highest spender on Facebook ads in the last three months.</li><li>Uttar Pradesh continues to be the biggest source of ad revenue for Facebook, the data shared by Ad Library shows.</li></ul>Homegrown microblogging app Koo has been spending more than the Uttar Pradesh (UP) division of ruling party Bharatiya Janata Party (BJP) on Facebook advertisements in the last three months. A quick study of the Facebook Ads Library <a href="https://www.facebook.com/ads/library/report/?source=archive-landing-page&amp;country=IN">revealed</a> that Koo spent over ₹1.5 crore across 285 ads on Facebook and Instagram between February 15 and May 15. It was followed by <keyword id="1740093" type="General" weightage="20" keywordseo="bjp-up" source="Orion">BJP UP</keyword>, which spent ₹1.4 crore across 1,301 ads in the same time frame. But it is to be noted here that while Koo spent the amount on a national campaign, UP BJP spent almost the same amount on a single Indian state. <cmsannotation type="cmsannotation" annotationid="Uttar Pradesh is the biggest source of ad revenue for Facebook" comment="subhead" text="Uttar Pradesh is the biggest source of ad revenue for Facebook">Uttar Pradesh is the biggest source of ad revenue for Facebook</cmsannotation> BJP UP is the highest spender on Facebook ads in the state. UP went for its assembly elections between February 10 and March 7 leading to BJP’s aggressive spends in the closely contested election. According to a previous report by Business Insider, BJP had spent over<a href="https://www.businessinsider.in/politics/news/bjp-up-has-spent-over-3-crore-on-facebook-ads-last-month-congress-spent-6-lakh/articleshow/89750791.cms"> ₹3 crore on Facebook ads</a> in UP between January 21 to February 19. This was nearly half of the total ₹7.5 crore — the highest among all states — spent on Facebook and Instagram ads in the Uttar Pradesh regions in the same time frame. Uttar Pradesh continues to be the biggest source of ad revenue for Facebook, the data shared by Ad Library shows. It is followed by the Punjab region, which accounted to only a third of the amount spent on ads in Uttar Pradesh. <table style="border-width: initial; border-style: none;"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">State </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Amount spent on Facebook ads between Feb 15-May 15 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Top advertiser </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Uttar Pradesh </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹6.6 crore </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Bharatiya Janata Party (BJP) UP </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Punjab region </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹2.2 crore </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Aam Aadmi Party (AAP) Punjab </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Maharashtra </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹1.3 crore </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Miracles Academy of Arts &amp; Media </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Gujarat </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹0.65 crore </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Koo </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Karnataka </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹0.65 crore </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Koo </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Madhya Pradesh </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹0.63 crore </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Koo </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Delhi </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹0.62 crore </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Samajwadi Party </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Rajasthan </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹0.62 crore </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Koo </td></tr></tbody></table>Source: Facebook Ads Library While BJP UP focused solely on Uttar Pradesh, Koo has been running nationwide advertising campaigns for quite some time. Koo — the Indian rival of Twitter — has been among the top three advertisers in the top eight states, according to Facebook Ads Library. Apart from Koo and BJP UP, Hindu Publicvibe and Samajwadi Party were the third and the fourth biggest spender of Facebook ads nationally. However, most of these ads were targeted towards people living in Uttar Pradesh. <div type="image" title="Twitter’s rival is spending more than Uttar Pradesh BJP on FB ads - but UP’s ad pie has been growing" msid="91660706" hostid="261"></div> Overall, ₹189 crore has been spent on Facebook and Instagram ads since February 2019, when Facebook started publishing its ads library data publicly. SEE ALSO <a href="https://www.businessinsider.in/business/news/heatwave-has-turned-acs-from-a-luxury-to-a-necessity-but-margins-remain-muted-for-the-players/articleshow/91655568.cms" data-type="tilCustomLink">Heatwave has turned ACs from a luxury to a necessity — but margins remain muted for the players</a> <a href="https://www.businessinsider.in/tech/news/google-russia-has-no-money-to-pay-salaries-to-its-100-employees-heads-for-bankruptcy/articleshow/91658749.cms" data-type="tilCustomLink">Google Russia has no money to pay salaries to its 100 employees, heads for bankruptcy </a> <a href="https://www.businessinsider.in/business/telecom/news/reliance-jio-vs-bharti-airtel-four-charts-to-showcase-how-indian-telecom-giants-faired-in-2022/slidelist/91640306.cms" data-type="tilCustomLink">Reliance Jio Vs Bharti Airtel — Four Charts That Showcase How The Indian Telecom Giants Faired In 2022</a>

The state of Uttar Pradesh and how it’s been feeding Facebook ad revenues

<ul><li>Spiritual leader Sadhguru and his non-profit organisation Isha Outreach is India’s largest advertiser on Meta platforms such as Facebook and Instagram for social and political causes. </li><li>Sadhguru and Isha Outreach spent ₹1.35 lakhs per day on Facebook and Instagram in the last quarter, amounting to ad spends of ₹1,20,91,079.</li><li>After Sadhuguru, micro-blogging platform Koo and OTT player Voot Select were the largest spenders of advertising monies on Meta platforms.</li></ul>Spiritual leader Jagadish Vasudev, more popularly known as Sadhguru, and his non-profit organisation Isha Outreach spent ₹1.35 lakhs per day on Facebook and Instagram advertising between April 27 and July 25. According to a recent report released by Hyderabad-based enterprise digital marketing agency Pyrite Technologies, Sadhguru and Isha Outreach's Conscious Planet are India’s largest advertisers on Meta platforms in social and political causes category. They spent a total of 1.20 crores on Facebook and Instagram. Sadhguru Jaggi Vasudev is an Indian yoga guru. He has more than 8.5 million followers on Instagram, 5.2 million fans on Facebook and 3.9 million followers on Twitter. Sadhuguru's Isha Foundation, according to its website, is also associated with a bouquet of business enterprises such as Isha Raiment, Isha Foods and Spices, Isha Crafts, Isha Naturo Organic Solutions, to mention a few. Following Sadhguru on the largest advertisers list is micro-blogging platform Koo. It spent almost ₹87 lakh on Meta in the 90-day period. Launched in 2019, Koo recently raised ₹79 crore from Caspier Venture Partner, Ashneer Grover and Ravi Modi Family Trust. <div type="image" title="Sadhguru gfx" msid="93287319" hostid="261" caption="&amp;lt;p&amp;gt;Pyrite&amp;lt;/p&amp;gt;"></div> India’s third largest advertiser, as per Pyrite, is OTT platform Voot Select with ad spends of ₹67 lakh. Voot Select is business tycoon Mukesh Ambani-led Viacom18’s subscription-based streaming platform. Political parties Bharatiya Janata Party (BJP) and BJP Gujarat also appeared on the list of top Indian advertisers on Meta. It is pertinent to note that as per India's advertising rules, not all Indian brands are not obliged to declare their spends as they don’t fall <a href="https://e4mevents.com/pitch-madison-advertising-report-2021/public/PMAR-Report-2021.pdf" data-type="tilCustomLink">under social causes category.</a> Between April 27 and July 25, Meta saw more than 12,863 advertisers from India and collected ₹13.94 crores in advertising revenues. As per analytics platform <a href="https://napoleoncat.com/stats/facebook-users-in-india/2022/07/">Napolean Cat,</a> there were 515,800,000 Facebook users in India in July 2022, which accounted for 36.2% of its entire population. The growing number of advertisers and users in India makes the country a <a href="https://www.statista.com/statistics/268136/top-15-countries-based-on-number-of-facebook-users/#:~:text=Apart%20from%20India%2C%20there%20are,116%20million%20Facebook%20users%20respectively.">top </a>market for Facebook.

Sadhguru and Isha Outreach are India’s biggest advertisers on Meta for social causes: They spent ₹1.35 lakhs per day on Facebook and Instagram

<div class="KonaFilter image-container display-table"><div><div class="image on-image">Scott Olson/Getty ImagesPortfolio trading volumes have ballooned in 2019.</div></div></div><ul class="summary-list"><li>Credit portfolio trading has exploded in 2019, according to Wall Street executives.</li><li>Investors are flocking toward the tool, and trading firms can facilitate it, as a way to exchange large, diverse bundles of bonds all at once with the help of algorithms and ETFs.</li><li>Wall Street's top fixed-income trading banks have experienced enormous growth in volumes and competition and are investing to capture the growing demand. </li><li>Electronic bond-trading marketplaces are joining the fray, too. Tradeweb launched its product less than a year ago, and MarketAxess is set to counter with its own offering in November. </li><li><a href="https://www.businessinsider.com/?hprecirc-bullet">Visit Business Insider's homepage for more stories</a>.</li></ul>One of the hottest trends in credit trading over the past year has every big bank and many trading venues investing money and resources to keep pace with what has become <a href="https://www.businessinsider.com/top-corporate-bond-dealers-pushing-to-electronically-trade-directly-2019-5">a vastly changing world</a>.This year marked an inflection point for credit portfolio trading, with volumes surging across Wall Street's biggest bond-trading desks as clients grew more comfortable with the transactions and banks and venues built out the capabilities to handle them. The shift means hedge funds and asset managers are increasingly adjusting their portfolios by bundling transactions together versus handling them piecemeal - making it easier and often cheaper for banks' biggest clients to reach the same end result. Bond index fund fees have come under intense competitive pressure industry-wide, leaving fund managers desperate to cut their own costs. It's the latest in a <a href="https://www.businessinsider.com/top-corporate-bond-dealers-pushing-to-electronically-trade-directly-2019-5">string of innovations</a> to come to the credit market in recent years, pushing the industry towards increased electronification and away from high-touch practices that dominated the space for so long. The top-ranked fixed income, currencies, and commodities (FICC) trading firms on Wall Street - including JPMorgan, Bank of America Merrill Lynch, Barclays, Morgan Stanley, and Citigroup - have all seen significant growth in their portfolio trading businesses in 2019."Credit portfolio trading has grown tremendously. If you just think about where people are going in terms of sourcing liquidity, we expect this to double in the next couple of years, if not triple," said Edward Koo, the head of North American single-name CDS trading, portfolio trading, and e-trading at JPMorgan Chase.Meanwhile, <a href="https://www.businessinsider.com/tradeweb-president-discusses-ipo-process-electronic-markets-2019-4">Tradeweb</a>, one of the largest electronic marketplaces for trading corporate bonds, has also enjoyed a strong uptick in portfolio trades since it went live with it less than a year ago. One of its biggest competitors, <a href="https://www.businessinsider.com/chris-concannon-discussed-where-the-bond-trading-can-evolve-2019-10">MarketAxess</a>, has plans to launch its own offering in <a href="https://markets.businessinsider.com/news/stocks/marketaxess-brings-efficiency-to-portfolio-trading-protocols-1028291183">November</a>. More than just the latest trend to hit bond trading in recent years, portfolio trading is an example of top industry players racing to keep pace in a market being upended by technology - or risk getting left behind.<h2>Banks are seeing big growth in portfolio trading</h2>The concept of portfolio trading has been around for a while. But recent technological firepower has allowed the process to evolve from the hyper-manual passing of Excel spreadsheets back and forth to handling large or complex trades with ease and regularity due to algorithms and advanced risk analysis.The way it works is pretty straightforward: Instead of hitting up individual brokers to trade bonds one at a time, an investor offers up or requests an entire basket of them, potentially hundreds of different securities, to execute in one fell swoop using algorithms and ETFs. There's no standard definition of what qualifies as a portfolio trade across institutions, so it's difficult to compare efforts. But executives across big-bank trading operations describe a massive uptick in 2019. To be sure, FICC trading revenues have generally been steadily shrinking industry-wide following the financial crisis, and while the portfolio trades represent a source of volume, they also are seen as lower-margin than old-school bond trades. <a href="https://www.businessinsider.com/bank-of-america-solved-monster-bond-etf-trades-aiming-higher-2019-7">Bank of America</a> handled a $1.5 billion bespoke trade this summer comprising hundreds of bonds. It took under an hour, and cost the client less than three basis points - less than what it typically costs to execute an individual $25 million investment-grade bond trade - and they used bond ETFs to help offload the risk, executives at the<a href="https://www.businessinsider.com/bank-of-america-solved-monster-bond-etf-trades-aiming-higher-2019-7"> firm told Business Insider.</a> The firm launched its portfolio trading desk in early 2017 and has seen volumes balloon in 2019, and in July it went live with a new team focused on harnessing the firm's success trading bond portfolios and ETFs and deploying that across the fixed-income asset classes. Goldman Sachs is considered a pioneer in credit portfolio trading, with efforts at an algo-driven offering dating back to 2016. The bank did more than $30 billion in these trades in the in 2018, the <a href="https://www.ft.com/content/db773d0a-cc95-11e8-9fe5-24ad351828ab">Financial Times reported</a>, up from $7 billion in 2017.The top-ranked FICC firm on Wall Street, JPMorgan's initial foray into portfolio trading came in spring of 2018, but the bank started ramping up its efforts in earnest this April, adding headcount to Koo's team. By volume, the firm estimates bond portfolio trades have as much as quadrupled year-over-year. Drew Mogavero, head of US credit trading at Barclays, told Business Insider his firm has been active in portfolio trading since the second half of 2018 and has experienced "meaningful" growth throughout 2019."We haven't found many folks who aren't interested in learning more about it," he added.Morgan Stanley, meanwhile, has seen a considerable increase in the volumes and number of clients involved since setting up a dedicated portfolio trading team within its credit division in March 2018. Year-over-year, the bank has seen a 60% increase in portfolio trading volumes as of October, with plans to continue to invest in tech and resources towards growing the effort, Edward Bayliss, head of macro credit at Morgan Stanley, told Business Insider."Portfolio trading has become an integral part of our overall credit trading business," he said.Even non-bank dealers have gotten in on the action. Proprietary trading firm Jane Street, a major player in the ETF-trading space, has also been challenging the banks with its bond portfolio offering, handling $12.5 billion in volume in the first half of 2019, according <a href="https://www.bloomberg.com/news/articles/2019-06-05/bofa-jane-street-say-rise-of-etfs-is-improving-the-bond-market">to Bloomberg</a>. Citigroup, the second-ranked FICC-trading bank, launched its systematic portfolio trading option this April, rolling it out first in investment-grade bonds and then high-yield debt this summer."Competition in the portfolio trading space from both banks and non-bank participants is increasing rapidly," Joe Geraci, cohead of global spread products at Citigroup, said.<h2>Investors find plenty of use cases for portfolio trading</h2>Investors big and small have shown interest in portfolio trading. For some it's a complement to ETF trading, where hundreds of bonds can be transformed into ETF shares. Others see its benefits in the ability to quickly adjust the risk portfolio of a certain strategy."There's been tremendous take-up from many different investor bases, whether it's asset managers, insurance companies, levered accounts. It's a more efficient mechanism and vehicle with which to displace risk," JPMorgan's Koo said. To be sure, some in the industry have pointed to portfolio trading only benefiting the largest investors. After all, only a fraction of investors have the capital to execute a portfolio trade over a billion dollars. However, trades don't need to be gigantic to yield benefits, either - they can also be used for moving a large amount of small bonds."There are many, many different usages. Certain ones are growing a little bit faster than the others, but they're all sort of coming together and that's why you see sort of this velocity and this exponential growth," Koo added. <h2>Trading venues also want in </h2>While portfolio trading can be done directly between banks and their customers, electric trading venues are also getting in on the action, offering a one-stop shop for investors to source portfolio trades amongst dealers more easily. Tradeweb, which went public <a href="https://www.businessinsider.com/tradeweb-president-discusses-ipo-process-electronic-markets-2019-4">in April</a> and is among the <a href="https://www.businessinsider.com/greenwich-associates-predicts-consolidation-in-us-bond-market-2019-1">wave of electronic marketplaces</a> that have seen an increasing amount of trading volume in recent years, began offering portfolio trading at the end of 2018.As of the end of September, the trading venue has already eclipsed $25 billion in portfolio trades, with a couple trades breaking the $1 billion mark, Chris Bruner, head of US credit at Tradeweb, told Business Insider. Average portfolio trade sizes are between $50 million to $100 million, with the mean continuing to skew higher as customers have grown more comfortable with the trading protocol, he added.<div class="KonaFilter image-container float_right"><div class="image on-image">TradewevChris Bruner, head of US credit at Tradeweb</div></div>Bruner sees a key benefit of portfolio trading in its ability to allow investors to move bonds that don't typically trade often. "There's an opportunity for those less-liquid securities to trade more from portfolio trading," Bruner told Business Insider. "If you put it in a basket of a hundred bonds, a liquidity provider is more interested in getting the whole trade and a little less worried about, 'Hey, do 20% of these securities not trade very often?' Because they want the whole trade."To be clear, portfolio trading doesn't completely eliminate the liquidity issue that has plagued the bond market for so long. Ultimately, there's no silver bullet to systematically price a bond that hasn't traded in a year. Currently, Tradeweb is the only electronic marketplace that offers portfolio trading for US corporate bonds, but that will soon change.In June, MarketAxess, the largest electronic trading venue for US corporate bonds, announced plans to launch portfolio trading in the fall, though the firm had previously targeted early 2019, according <a href="https://www.ft.com/content/db773d0a-cc95-11e8-9fe5-24ad351828ab">to the FT</a>. A MarketAxess spokesperson confirmed the marketplace will go live with portfolio trading in November.And while dealers and trading venues alike are pushing to build out portfolio trading offerings, some investors warn there is only so much business to go around. "There's a lot of investment in terms of the set up and the structure that the bank needs to facilitate this activity, as well as an explicit investment in technology,"a senior executive at a large asset management firm recently told BI, adding that there are only "a handful of players that can do this in a meaningful way." <div class="margin-top"> <h3>NOW WATCH: <a href="https://www.businessinsider.com/taylor-swift-net-worth-singer-millionaire-makes-spends-money-wealth-2019-4">Taylor Swift is the world's highest-paid celebrity. Here's how she makes and spends her $360 million.</a></h3> <div> </div> </div>

Investors are demanding to trade hundreds of bonds by the bundle, fueling an arms race among Wall Street giants who want a piece of the action

South Korea's millennials say their lives aren't that different from 'Squid Game' as they face a crisis of mounting debt, unaffordable homes, and dead-end jobs

<div class="KonaFilter image-container display-table"><div><div class="image on-image"></div></div></div>The Denver Broncos were able to come up with a 24-21 win over the Los Angeles Chargers on Monday by blocking the Chargers' field goal attempt to send the game to overtime.For the Broncos, the block, made by defensive lineman Shelby Harris, was only made possible by their decision to "ice" Chargers kicker&#xa0;Younghoe Koo before his first attempt."Icing" the kicker is common strategy in football in which coaches call timeout right before the kicker attempts a field goal, just to try to get in their head. In the case of the Broncos and Chargers, it may have been worthwhile, as Koo is a rookie kicker, but still unlikely to work -&#xa0;there isn't math that suggests "icing" leads to missed attempts.However, the Broncos' late timeout actually had another benefit - extra time for defensive end Derek Wolfe to design a play for Harris to get to Koo.During the snap for Koo's first kick - at which time the Broncos called timeout &#xa0;- Wolfe blew past Chargers offensive lineman Dan Feeney. Wolfe said after the game that he had been getting past Feeney easily all game and knew that on the second attempt Feeney would concentrate on blocking him. Wolfe said he told Harris that he would attack Feeney and create room for Harris to get to Koo."We were kicking that guy's (butt) the whole game," Wolfe said. "We were knocking him back the whole time. Every time they tried to kick a field goal, we were getting a push .... I was like, 'He's going to lean on me. Shelby, just go. Just go.'"Here's the Broncos' block on the field goal that sealed the win:Another angle shows how Wolfe attacked Feeney's outside shoulder, creating the gap for Harris.<div class="KonaFilter image-container display-table"><div><div class="image on-image"></div></div></div>And though the movement is tough to detect, a gap opened up for Harris and he broke through and got a finger on the ball. Meanwhile, Wolfe was still being blocked, as was the plan.<div class="KonaFilter image-container display-table"><div><div class="image on-image"></div></div></div>Harris said afterward: "If it wasn't for Wolfe on that play, I wouldn't have had any chance at all. It was a two-man job. We dominated the guard and made the play."He added, "I'm sure my fingers will hurt tomorrow, but I'm good."While line play is often the most subtle and perhaps driest part of football, it's nonetheless crucial and detail-oriented. As a result of the Broncos' preparation and smart defensive line play, they picked up a big win over a divisional opponent.<div></div> <div class="margin-top"> <h3>NOW WATCH: <a href="http://www.businessinsider.com/how-floyd-mayweather-makes-spends-his-millions-net-worth-conor-mcgregor-boxing-money-luxury-cars-2017-7">How Floyd Mayweather makes and spends his millions</a></h3> <div> </div> </div>

The Broncos made a key adjustment after 'icing' the kicker that allowed them to block the Chargers' game-tying field-goal attempt

<div class="KonaFilter image-container display-table float_right"><div><div class="image on-image"></div></div></div>"Full employment!"That's the exclamation BNP Paribas economists made after the release of <a href="http://www.businessinsider.com/february-jobs-report-march-6-2015-3">February's better-than-expected jobs report</a>.US companies added 295,000 nonfarm payrolls during the month, driven by a 288,000 surge in private payrolls. This helped the unemployment rate tumble to 5.5% - the lowest level since May 2008 - from 5.7% the month prior."The current unemployment rate (5.5%) has now breached the upper bound of the FOMC's latest central tendency for the long-term unemployment rate (or non-accelerating inflation rate of unemployment) of 5.2-5.5%," <a href="http://www.businessinsider.com/bnp-paribas-declares-full-employment-2015-3">BNP Paribas economists said</a>. "This is a significant move that will put pressure on the Committee to lay the groundwork for higher rates soon."Most economists currently expect the Fed to start tightening monetary policy in June via interest rate hikes. But not every economist agrees.Here's your Monday Scouting Report:Top Stories<ul><li>June-ish. <a href="http://www.businessinsider.com/r-wall-street-firms-more-convinced-of-june-rate-hike-reuters-poll-2015-3">Nine of 16 banks surveyed by Reuters</a> expect the Fed to begin hiking rates in June. However, while acknowledging the significant improvements in the economy, there are plenty of economists who believe the Fed will wait a little while longer. "With the final employment report in hand before the upcoming FOMC meeting, we think the Committee will modify its forward guidance on March 18," Goldman Sachs' Jan Hatzius said. "In our view, the most likely scenario is that the Committee replaces the reference to being "patient" in hiking the funds rate with new language that affords the possibility -without suggesting an overwhelming likelihood-of a hike as early as June. Our forecast remains for the first hike in the fed funds rate to occur in September." </li><li>"Lift-off." Even <a href="http://www.businessinsider.com/ny-times-editorial-on-rate-hikes-2015-3">the New York Times editorial board</a> cautions the Fed from hiking rates too soon. <a href="http://www.businessinsider.com/richard-koo-on-rate-hike-lift-off-2015-3">For Nomura's Richard Koo</a>, it's very important that once the Fed begins hiking rates it stays the course. From Koo: "Once the Fed begins its mechanical tightening process, stopping before the goal is reached could upset the markets. Given the importance of getting the timing right, the FOMC needs to be absolutely sure that tightening is the right thing to do... On this point, three of the members on the rate-setting committee have already argued that the Fed should tighten, while Chair Yellen and the rest of the members believe the start of this long 375bp journey is similar to a rocket launch in that all conditions need to be favorable... Interestingly, these people are referring to the first rate hike as "lift-off," which is the term used to describe the moment the rocket leaves its launching pad. This is an indication of how careful the Fed will have to be when pushing the button on a rate increase." </li></ul>Economic Calendar <ul><li>Job Openings and Labor Turnover Survey (Tues): Economists expect the January JOLTS report to reveal 5.039 million US job openings. From Credit Suisse: "Job openings rose in December to 5.0M, which drove the vacancies-to-unemployed workers' ratio up to 0.58 - its highest level since November 2007. January's data could see some correction due to the uptick in January unemployment."</li><li style="line-height: 1.5em;">Monthly Budget Statement (Wed): Economists estimate the US had a budget deficit of $187 billion in February. From Nomura: "Fiscal year to date, the government has run a deficit of $194.2bn, a 6.2% increase from the comparable period last year. We expect the federal government expenditures to be close to neutral growth in 2015 after contributing negatively to growth for the past three years."</li><li>Retail Sales (Thurs): Economists estimate retail sales climbed by 0.4% in February. Excluding autos and gas, core sales are estimated to have increased by 0.3%. From Bank of America Merrill Lynch: "Gasoline prices increased in the month, which pushes up overall spend. But even controlling for the swing in gasoline prices, we think the underlying trend in spending will be slightly better. We are still somewhat cautious because the harsh winter weather could be holding back spending in parts of the country. If not for the weather, we would be much more positive on retail sales given the savings from lower gasoline prices over the past six months and robust job growth. Looking forward to the spring, we expect a notable improvement in spending."</li><li>Initial Jobless Claims (Thurs): Economists estimate the weekly jobless claims fell to 305,000 from 320,000 a week ago.&#xa0; From Deutsche Bank: "... they are expected to only partially offset their recent weather-related run-up as winter storm Thor wreaked havoc on a broad swath of the country over the past week. Claims will need to move back below 300k in order for us to get another large employment report in March."</li><li>Producer Price Index (Thurs): Economists estimate producer prices climbed by 0.3% month-over-month or 0.0% year-over-year. Excluding food and energy, core PPI is estimated to have climbed by 0.1% and 1.6%, respectively. Here's Morgan Stanley: "Wholesale gasoline prices rebounded about 20% between the February and January PPI survey periods after falling 23% in January. With some offset from weak natural gas prices, we look for overall PPI energy to gain 6% after falling 10% last month. Substantial weakness in services prices in January, most notable in healthcare, led to a 0.3% plunge in core (ex food, energy, and trade services) PPI in January. We look for a partial rebound in services along with soft core goods prices to lead to a slight rebound in the core in February. Our monthly estimates would boost the headline year/year pace to 0.4% from 0.0% and leave the core unchanged at 0.9%."</li><li>U. of Michigan Sentiment (Fri): This index of sentiment is estimated ot have climbed to 95.7 in March from 95.4 in February. From Barclays: "&#xa0;Retail gasoline prices have now stabilized after a few months of consecutive declines, while stock market prices have remained buoyant. Both are consistent with favorable conditions for consumers but not with a further rise in the index from its already high level."</li></ul>Market CommentaryOn March 2, <a href="http://www.businessinsider.com/closing-bell-march-2-2015-3">the Nasdaq topped 5,000</a> for the first time since 2000. At first glance, veteran market watchers can't help but be jarred by the memory of the tech bubble.<a href="http://www.businessinsider.com/nasdaq-5000-might-not-be-different-this-time-2015-3">Most</a> experts argue firmly that <a href="http://www.businessinsider.com/what-makes-this-nasdaq-5000-different-2015-2">it's different this time</a>. Importantly,<a href="http://www.businessinsider.com/barrons-on-nasdaq-5000-2015-2"> earnings are at much higher level today </a>than the were in 2,000.But <a href="http://www.businessinsider.com/nasdaq-5000-might-not-be-different-this-time-2015-3">some are a bit more skeptical</a>. From Deutsche Bank: "There was much excitement about the milestone - with bulls and journalists seemingly unanimous that this time is different because today's 30 times price/earnings ratio [a measure of valuation] is miles from the bonkers 150 times seen at the end of the millennium. But current or forward earnings multiples are meaningless. If you smooth Nasdaq's volatile profits, and adjust for inflation, valuations look more worrying. Based on ten year average earnings the current PE is 50 times, versus 65 at the peak. More important, with the exception of QE-fuelled 2009, investors have been wise since 1999 to sell the Nasdaq whenever this so-called Shiller PE [another measure of valuation] reaches 50 times - with a subsequent average three year return of minus 20 percent."For more insight about the middle market, visit <a href="https://urldefense.proofpoint.com/v1/url?u=http://mid-marketpulse.com&amp;k=S62Tl7vLGjW6AAK5ZFwEoQ%3D%3D%0A&amp;r=%2B2sEypbBAnV2mc5PLhBR08ZBMT%2BquZZGjxd0T7NNaP4%3D%0A&amp;m=UtLLChRIkxZLioNs9a5IxKFS7RONkU%2FjCuvoQ68P2Hw%3D%0A&amp;s=28acf971eb6ce00a636a9e28c206665a00dc8a6b849c5fbdd6236e929e9008ce" target="_blank">mid-marketpulse.com</a>. <div class="margin-top"> <h3>NOW WATCH: <a href="http://www.businessinsider.com/invest-warren-buffett-berkshire-hathaway-2015-2">How to invest like Warren Buffett</a></h3> <div> <div> <div class="ooyala-video-player" data-video-autoplay="false" data-video-id="s3M3ZhbDpuxZm0OsRtnfcALpwlLIe4o6" data-player-variable="ooyalapopvideo" id="ooyalaplayer_popvideo" style="width:1280px;height:720px"></div> </div> </div> </div>

Here's your complete preview this week's big economic events

<div class="image-container float_right"><div class="image">afp</div></div><keyword id="1334" type="COUNTRY" weightage="60" keywordseo="China">China</keyword>'s online-video market is the largest and most innovative in the world. It is also the most competitive
LATER this month PPTV, a Chinese online-video firm, will release a new reality show called "The Goddess Office" (pictured) about four young women living together in a house, trying to create their own e-commerce company. Viewers will be able to ask the stars questions and send them money and ideas for their start-up. The show will employ familiar television elements: the comedic rapport of the characters in "Friends" and the commercial ambitions of contestants in "The Apprentice". But this "television" show will run exclusively online, rather than on a traditional TV network.
Around the world online video is becoming a bigger and more sophisticated business, but nowhere is that truer than in China. The country has the largest number of online-video viewers: around 450m, or nearly 80% of the internet-connected population. Their numbers will rise to around 700m by 2016, according to iResearch, which tracks the industry. In America and Europe, online video has yet to supplant broadcast- and pay-TV, but in China it seems rapidly to have done so. A government news source has said that in 2012 only 30% of households in Beijing watched TV, down from 70% three years earlier--although official figures are not always reliable.
Google's YouTube video service is blocked in China, but local companies, including Youku Tudou and Sohu, are wildly popular (see table). There is lots of user-generated content, but viewers spend most of their time watching professional shows, such as the full-length films, television dramas and comedies that the websites license from China and around the world. Media gluttons can devour all this content without charge, as long as they sit through the advertisements.
Online-video sites in China owe much of their popularity to the government's tight regulation of the TV industry: all of the 3,000-plus stations are state-owned and their programmes are heavily censored. Rules about content range from the predictable (no shows inciting political unrest) to the puzzling (no depictions of time travel). It takes months for programmes to get official approval for broadcasting, and only an estimated 30% of shows that are made get aired on TV.
Online-video sites, in contrast, need a government licence to operate, but are left to police the content on their sites themselves--perhaps because the government never expected them to attract such a mass of viewers. "In principle it's the same, but in reality it's very difficult to say what the standards are for the online-video content players," says Victor Tao, the boss of PPTV. For example, last month the government ordered television channels to edit episodes of "Pleasant Goat and the Big Big Wolf", a long-running children's cartoon, because it was deemed to be too violent. But online-video firms that host episodes of the show seem not to have been given the same instruction.
Around five years ago Chinese online-video firms started competing directly with television by making their own programmes, and this year they will spend a combined 1 billion yuan ($164m) on shows like "The Goddess Office", according to Jiong Shao of Macquarie Securities, an advisory firm. (The same thing is happening in America, too: three internet firms, Netflix, Amazon and Hulu, have been making their own programmes, to cut the cost of licensing content and to create a more tempting offering for subscribers.)
Online-video shows resonate more with the people aged between 15 and 40, who flock to their sites. For example, "Surprise", a series made by Youku that parodies such things as university entrance exams, has been viewed 260m times since it premiered on Youku in August.
This year the number of people watching online video on their mobile devices has surged. Analysts expect the arrival of fourth-generation mobile networks to accelerate this trend. People who watch shows on mobile devices spend more time viewing, overall, than those on desktop PCs, according to Victor Koo, the boss of Youku. The main challenge for him and his rivals is to lure more advertisers.
The size and innovation of the Chinese online-video industry may be unique, but its economics are not. Like all online-video companies that rely on ad revenues, Chinese firms find it hard to make much money, if any. Although the industry had revenues of around 9 billion yuan in China last year, few firms are profitable. This is because their costs are so high. Buying bandwidth to deliver content to so many users is expensive, and so are the rights to license content. As a result there have been nearly as many mergers as there are elimination rounds on "The Voice of China", one of China's most popular TV shows. Last year Youku and Tudou, the most popular online-video sites, merged. In May Baidu, an internet-search giant, bought PPS, a video site, for $370m and merged it with its existing video service, iQiyi.
Self-interest has helped change the treatment of copyright in China. Several online-video firms are stockmarket-listed, and as a result they take content licences seriously, especially since as makers of their own shows they now have intellectual property to protect. They are suing those who pirate their content and are thus stealing some of their potential traffic. Youku alone has several hundred copyright lawsuits on the go.
<h3>Turning the channel</h3>
Online-video firms are also setting their sights on the living room. Several firms are designing internet-enabled set-top boxes; LeTV is making an internet-enabled television. By invading TV stations' home turf they can make themselves more valuable to advertisers--and may even be able to start charging subscription fees.
However, there is no guarantee that this will make the industry profitable. "The biggest enemy to the online-video service providers is consumer behaviour," says Mason Xu of Heyi Capital, a venture-capital firm. Because the government runs the television "business", consumers are used to paying little for cable--the equivalent of around $3 a month for digital cable. So it is unclear if they will pay much for online video, even if it comes with extra benefits such as ad-skipping. A study by McKinsey, a consultancy, suggests that around 15% of Chinese viewers might subscribe to online video on an internet-enabled TV set if it cost no more than 30 yuan ($5) a month. But even that is probably optimistic.
Getting slaughtered in the ratings by online video has prompted China's TV channels to try harder. A wave of singing competitions and dating shows--some of them adaptations of successful Western ones--have come on air in recent years, particularly on provincial satellite channels. Meanwhile CCTV, the central government's giant channel, continues to lose viewers. Last month officials scolded other stations for their "vulgar" and "excessive" entertainment and pushed for more "morality-building" and educational shows. Some singing contests are being forced off the air, and from next year satellite stations will be limited to one foreign show a year.
This will only accelerate the broadcasters' decline and the switch to online viewing. "TV is useless now," one person posted on a Chinese weibo, or microblogging site. "Fortunately we still have computers."
Click <a href="https://subscriptions.economist.com/nwcd">here</a> to subscribe to <keyword id="425741" type="UNKNOWN" weightage="60" keywordseo="The-Economist">The Economist</keyword>

Online Video In China: The Chinese Stream

<h3>"There is a danger that the Fed has missed its window of opportunity. If it's waiting for some degree of fiscal certainty, this really could turn into QEternity."-Paul Ashworth, chief U.S. economist at Capital Economics</h3>
Wall Street was completely convinced that the <keyword id="6355253" type="ORGANIZATION" weightage="60" keywordseo="Federal-Reserve">Federal Reserve</keyword> would begin to taper its <keyword id="112402" type="UNKNOWN" weightage="60" keywordseo="Quantitative-easing">quantitative easing</keyword> program following its September FOMC meeting.
There were <a href="http://www.businessinsider.com/non-economic-reasons-the-fed-is-tapering-2013-9">several compelling reasons why it had to happen in September</a>. In short, Committee members had raised concerns over both frothy markets and the economic effectiveness of QE in previous meetings, putting the central bank's credibility on the line by priming market participants for a tapering announcement and doing nothing to change expectations thereof.
When the FOMC concluded its meeting on September 18 and announced that it would refrain from tapering on the grounds that economic data weren't improving quickly enough, market participants were completely caught off guard. Bond prices soared as investors re-calibrated their positions to reflect this new reality.

"We have never heard investors as angry as the day after the Fed decided to not taper its asset buying program," <a href="http://www.businessinsider.com/qe-confusion-from-inaccurate-jobs-data-2013-10">said BofA Merrill Lynch economist Ethan Harris</a>. "Some investors argue that it was a deliberate attempt to introduce volatility into the market. Others said Fed credibility is shot."
In a recent report, ISI vice chairman Krishna Guha, a former New York Fed official who served as a senior adviser to New York Fed president Bill Dudley until just a few weeks before the FOMC's September decision, sums up nicely the confusion the FOMC has created over the outlook for quantitative easing.
Quoting minutes from recent FOMC meetings, Guha writes (emphasis added):
<div class="column">
The forward guidance on the balance sheet is provided by the QE policy rule. The problem here - as I have pointed out repeatedly - is that there is not one single policy rule but two elements of the policy rule that are not properly integrated. 
The first element is the economic outcome based rule - that the committee will continue its purchases of Treasuries and MBS "until the outlook for the labor market has improved substantially in a context of price stability." The second element is the cost-benefit rule - Committee decisions about the pace of purchases will "remain contingent on its assessment of the likely efficacy and costs of such purchases."
In my opinion the May/June taper talk was a tightening in monetary policy because it was not consistent with the forward guidance on the balance sheet provided by the economic outcome based policy rule. Put another way, it suggested that the Committee was pivoting from the first element of the policy rule to the second (cost-benefit analysis).
</div>
And markets fell for the head-fake.
Then, less than two weeks later, Congress shut down the U.S. government for 16 days, scaring market participants with the prospect of a debacle in which warring parties failed to raise the impending debt ceiling, resulting in a default on U.S. debt. And at the same time that major money-market funds were dumping U.S. Treasury bills, consumer confidence was plummeting.
The shutdown was eventually lifted, and a true debt ceiling crisis was averted - at least, temporarily. But the resolution didn't stop Bank of America from slashing its Q1 2014 GDP growth forecasts to reflect the next round of fiscal sparring set to take place in January and February, when the current deals struck by Congress this month expire.
<div class="KonaFilter image-container float_right click-to-enlarge"><div class="image"><a title_source="Markit" title_caption="American manufacturing output contracted in October for the first time since September 2009, at the height of the global financial crisis." class="zoomin" href="http://static6.businessinsider.com/image/526920bb69bedd2c7ae18b3c-960/screen%20shot%202013-10-24%20at%209.28.55%20am.png"></a><a href="http://www.markiteconomics.com/Survey/PressRelease.mvc/b09c5d2286464631a1b040b8d7370dfc">Markit</a>American manufacturing output contracted in October for the first time since September 2009, at the height of the global financial crisis.</div></div>Meanwhile, today we got the first look at the impact the fiscal crisis had on the American economy with <a href="http://www.businessinsider.com/flash-us-pmi-reveals-effect-of-shutdown-2013-10">Markit's flash October U.S. PMI survey</a>, and it wasn't pretty. American manufacturing output contracted for the first time since September 2009. Manufacturers cited weakening domestic demand for the drop in output, even as new export orders rose, reflecting an improving economic picture overseas.
"It is clear from the September minutes that most Fed policymakers thought ex-ante that the no taper decision at that meeting meant taking time out for 6-12 weeks, during which time they would be able to review some additional data in housing and employment in particular, to validate the forecast before starting to taper," says Guha. "However, ex-post it is likely to take much longer to get the data they need to see consistent with the economic outcome based element of the QE policy rule reasserted in September."
Initially, when the Fed didn't taper in September, Wall Street analysts and economists quickly coalesced around the view that it would probably do so in December.
Then, when the economic effects of the shutdown came into view, expectations were pushed out to January, and now, many say they don't expect the Fed to act until March.
Guha, for one, sees chances for when the Fed is most likely to announce the taper like this: 25% in December, 30% in January, 30% in March, and 15% after March.
And amid a big rally in the bond market, many are wondering if tapering is quickly becoming a distant September memory.
In a <a href="http://www.businessinsider.com/medley-fed-hit-reset-button-on-tapering-2013-10">new report making the rounds</a> on Wall Street bond trading desks today, Medley Global Advisors analysts Regina Schleiger and Jeremy Torobin argue that, "more than simply standing pat, the Federal Open Market Committee has effectively hit the reset button and is back where it was six months ago - at the very start of a long process of building the case for a downward adjustment to the Large-Scale Asset Purchase program."

"That [tapering] eventuality is now a riskier proposition (and, consequently, the process of getting back to within striking distance is more difficult) because of troubling signs that economic momentum is slowing," write the Medley analysts. "The potential costs to financial stability of continuing purchases at the current $85-billion per month may, down the road, start flashing red and embolden FOMC hawks to push for an aggressive conclusion of the program. But right now the potential costs of withdrawing even the slightest bit of support from the economy appear much greater than they were."
The consensus on Wall Street is that U.S. economic growth finally takes off in 2014, which will give the Fed the opportunity to taper.
But what if it doesn't? Consider this: some believe the U.S. economy is actually entering a "late-cycle stage" - in other words, the upward acceleration may not be coming.
"A growing number of indicators are showing late-cycle dynamics, and while this need not imply a recession it might well indicate a shift into a period of slower growth and lower inflation," says Deutsche Bank global head of rates research Dominic Konstam.
"So much for animal spirits," he writes in a recent note to clients:
<div class="column">
All else equal, our investment model that is derived from profits now clearly shows falling investment spend in 2014. So much for animal spirits: the corporate sector has little economic reason to invest, animal or not. 
<div class="KonaFilter image-container float_right click-to-enlarge"><div class="image"><a title_source="Deutsche Bank" title_caption="" class="zoomin" href="http://static6.businessinsider.com/image/526960b1ecad04730ef96a91-960/screen%20shot%202013-10-24%20at%202.01.52%20pm.png"></a>Deutsche Bank</div></div>
This is also apparent in corporate free cash flow, or internal funds available for investment. The first issue is that corporate cash flow growth has turned negative in recent data - levels not seen since 2007. The second issue is that year-over-year growth in corporate cash flow has historically tended to follow the contribution of labor input to profits, with a four quarter lag. This observation also argues that labor input is the moving part that is used to restore cash flow growth via profits. The recent increase (less negative decrease) in profits attributed to labor input could then be seen as the beginning of attempts to strengthen cash flow, with the bad news being that a positive contribution to profits implies cutting labor input.
<div class="column"><div class="KonaFilter image-container float_right click-to-enlarge"><div class="image"><a title_source="Deutsche Bank" title_caption="" class="zoomin" href="http://static3.businessinsider.com/image/5269617369bedd7111e18b3c-960/screen%20shot%202013-10-24%20at%202.05.07%20pm.png"></a>Deutsche Bank</div></div>
Because free cash flow can be seen as the funds available for potential investment, another potentially disquieting implication for the longer run is that in order to increase investment, the corporate sector will necessarily reduce labor input, in terms of growth or outright. Either of these would provide a means for pushing productivity and capital/labor ratios (higher) back toward historical norms. 
Labor input is high relative to productivity, which typically predicts a sharply slower labor market 2 years ahead. In fact, simply conditioning on the relative gaps of labor input to productivity when it is negative predicts an almost stagnant labor market. In the absence of further fiscal or monetary stimulus, a lower household savings rate, or some combination of these, the implication is lower, not higher, rates.
</div>
"This is hardly a recipe for above trend growth," says Konstam. "We note that recent trend real growth is less than 2%, so if inflation is stuck in the 1-1.5% range, then nominal growth is stuck closer to 3%, not 4%. In that environment, nominal yields become restrictive over 3% and become inhibitive to growth."
Here, Konstam is talking about a notion that Nomura chief economist Richard Koo has picked up on in recent weeks: that the Fed has backed itself - and the American economy - into a "QE trap."
Koo visited U.S. clients and Fed officials in a recent trip, and he <a href="http://www.businessinsider.com/koo-says-no-one-can-refute-the-qe-trap-2013-10">said no one was able to refute his theory</a>, which goes like this: the Fed talks about tapering, sparking a rise in long-term interest rates as investors dump bonds. The rise in interest rates then weighs on rate-sensitive sectors of the economy - like housing and automotive - which causes the Fed to call the whole thing off because economic data aren't showing adequate improvement. 
"This is ultimately the logic to our argument earlier this year that the sell-off driven by the shock of Fed taper rhetoric and the resulting positioning shift was self-limiting and could be said to preclude, rather than reflect, recovery," says Konstam.
Perhaps the FOMC eventually decides that, regardless of the trajectory of economic growth, QE represents too big a stability risk to be worth it, as the Medley analysts suggest.
ISI's Guha also foresees such a scenario if the data don't, in fact, improve.
"I think we are now in a zone of true data dependency in which QE will be driven almost entirely by the data flow and how this affects the Fed forecast," he says. "I am confident this zone of true data dependency lasts through January and it will probably last through March. By contrast, from the March meeting onwards (if not before) the decision to taper becomes a question of monetary policy strategy, not just data flow - specifically, whether the Fed is willing to contemplate 'QE infinity' in a context of 2% growth."
</div>

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