Google Inc's chief economist said the company's US$10 billion annual online advertising business is flourishing even as turmoil in the credit markets curbs corporate and consumer spending.
While advertisers may cut television, print and radio budgets during economic slowdowns, Google is less vulnerable because companies will spend more on ads that can be targeted at specific consumers, said Hal Varian, who was hired two months ago to lead Google's economics group.
"It's measurable, it's quantifiable and that's the very last piece of advertising a company wants to cut," Varian said in an interview on Friday.
"We're looking pretty good from the viewpoint of macroeconomic sensitivity," he said.
That contrasts with the housing, credit and private-equity markets, which have been pummeled by the subprime mortgage crisis.
The fallout has spilled over into the consumer market, prompting retailers such as Wal-Mart Stores Inc and Home Depot Inc to cut their profit forecasts for the year.
Google, owner of the most popular search engine, gets 99 percent of its revenue from sponsored links on its own pages and ads on partner sites. Revenue at the Mountain View, California-based company rose 73 percent to US$10.6 billion last year.
Varian said ad revenue from the housing industry has gained because lenders and brokers are facing stiffer competition.
"I can certainly say they haven't cut back on the Internet side," Varian said.
The US dollar was trading at NT$29.7 at 10am today on the Taipei Foreign Exchange, as the New Taiwan dollar gained NT$1.364 from the previous close last week. The NT dollar continued to rise today, after surging 3.07 percent on Friday. After opening at NT$30.91, the NT dollar gained more than NT$1 in just 15 minutes, briefly passing the NT$30 mark. Before the US Department of the Treasury's semi-annual currency report came out, expectations that the NT dollar would keep rising were already building. The NT dollar on Friday closed at NT$31.064, up by NT$0.953 — a 3.07 percent single-day gain. Today,
‘SHORT TERM’: The local currency would likely remain strong in the near term, driven by anticipated US trade pressure, capital inflows and expectations of a US Fed rate cut The US dollar is expected to fall below NT$30 in the near term, as traders anticipate increased pressure from Washington for Taiwan to allow the New Taiwan dollar to appreciate, Cathay United Bank (國泰世華銀行) chief economist Lin Chi-chao (林啟超) said. Following a sharp drop in the greenback against the NT dollar on Friday, Lin told the Central News Agency that the local currency is likely to remain strong in the short term, driven in part by market psychology surrounding anticipated US policy pressure. On Friday, the US dollar fell NT$0.953, or 3.07 percent, closing at NT$31.064 — its lowest level since Jan.
Hong Kong authorities ramped up sales of the local dollar as the greenback’s slide threatened the foreign-exchange peg. The Hong Kong Monetary Authority (HKMA) sold a record HK$60.5 billion (US$7.8 billion) of the city’s currency, according to an alert sent on its Bloomberg page yesterday in Asia, after it tested the upper end of its trading band. That added to the HK$56.1 billion of sales versus the greenback since Friday. The rapid intervention signals efforts from the city’s authorities to limit the local currency’s moves within its HK$7.75 to HK$7.85 per US dollar trading band. Heavy sales of the local dollar by
The Financial Supervisory Commission (FSC) yesterday met with some of the nation’s largest insurance companies as a skyrocketing New Taiwan dollar piles pressure on their hundreds of billions of dollars in US bond investments. The commission has asked some life insurance firms, among the biggest Asian holders of US debt, to discuss how the rapidly strengthening NT dollar has impacted their operations, people familiar with the matter said. The meeting took place as the NT dollar jumped as much as 5 percent yesterday, its biggest intraday gain in more than three decades. The local currency surged as exporters rushed to
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