Google has been making in-roads into China, but they have been facing since the inception the "censorship" issue which is prevalent in China's media. I even read China made the makers of World of War Craft change some graphical content and references before the game could be released to the Chinese community.  Google has been playing by the rules set by the Chinese government for them to "self-censor" their search engine or have they. A recent highly sophisticated hacking into Google's gmail (as well as 20 other companies) is possibly a covert attempt by the Chinese government to reveal if Google and others are abiding by the rules.

            Google said enough is enough and made the decision to stop their self-censorship and may even pull out of China. The problem that Google and other companies face is that the allure of the world's fastest growing and potentially largest market can be a make it or break it future.  Professor Pohlman points out an interesting observation, ""Western companies such as Google face a dilemma in China. On the one hand, they're eager to benefit from China's dramatic economic growth. On the other, they have to deal with local laws and values that are different from the West. Especially for media companies, it's a tricky issue as China has a different definition of privacy and human rights."  He is right - like with any country if we want to play in their sandbox we have to play by their rules. It's no different than any other country, except for the fact that it is not what WE are used to.
           

         Google is ethically and morally right from a western perspective, however it might not be the best idea to pick a fight with a sovereign nation's laws or government. The people of the nation need to bring change to their own nation, not a U.S. internet company. I appreciate the moral dilemma, but Google is mixing their business model with political rights - which is not what shareholders want and the stock is taking some serious heat this morning.
 
            Google maybe learning a very important lesson, never mix politics and profits - it's always a losing game. You may win some political points, but how much will it cost you. If the management of Google want to make a political statement, do so on their own time.
 
            Don't get me wrong - I am NOT a supporter or believer in what China is doing and have serious issues with it.  But if I was an investor in Google, I don't want them to pick a unwinnable fight that will only hurt the company, regardless how politically correct their point is.
 
            For investors that have problems with China's politics and think Google is right. Then I hope they don't invest in Coke, Pepsi, Ford, CAT, and the numerous other companies that do business in China that don't rock the political boat. I also hope they don't buy anything - since everything is made in China. We all swim in the massive sea of hypocrisy.
 
            This is a fight for the people and politicians - not government and the market is speaking volumes - just look at Google share prices and BIDU share prices. Google is down over $10 points this morning and if things get worse for them in China it's not going to spell good news for the stock. On the other hand Google's main competition, BIDU (a Chinese version of Google) is up over $60 points this morning. Of course BIDU plays by the rules and this just helps BIDU's market share.
 
http://www.bloomberg.com/apps/news?pid=20601087&sid=aU43JmiuDJaQ

                      On the surface it seems that everything is getting back to normal as mortgage applications rise in the first week of 2010 by 14.3%. The spin doctors are making more of this than it really is. The bulk is refinancing, rather than a reflection of a buying spree as some would have us believe. Refinancing that has been happening is out of necessity, as many come due. It is hard to use this data as a gauge of recovery, rather it should be viewed in detail as to how much refinancing vs. how much is coming due and the difference in rates. I wouldn't put too much into this, other than what it is.

                      As I mentioned in the opening, the futures is about taxes and fees. The new fees that Obama announces on banks and financial institutions to help recoup bailout money is the first round that will eventually trickle down to the customers. It's a tax nothing more or less. And just like the tax on cigarettes, they companies will just pass it through to their clients. So the tax payer bailed out the companies and now will most likely pay a tax to pay themselves back, which they will never get back since the government is operating at a massive deficit with mounting debt. I seriously doubt when Obama says this is to payback the tax payer, that we will ever see any checks from the government.

            No doubt that these financial institutions used government bailout money to help increase profits (some are seeing record profits and huge bonuses), but what did anyone expect? Of course they were going to use the money to make profitable investments, anyone that thought otherwise is a fool. The fool is the government and tax payer for continuing to bailout companies - (many of which just faced bankruptcy anyway) and now are all surprised and upset when they made money and get huge bonuses.

            The administration is making the populist decision, since there is so much hate (rightly or wrongly) so for CEOs and Wall Street. Now they want to tax them with this "Fee" - no problem, they'll of course just pass it through to their customers and shareholders. Another failed attempt by government and another tax for business and the people.

            The hearing today - is just going to be another dog-n-pony show and we should all expect more "fees" and taxes to start covering the Fed's and government's massive deficit and mounting debt. My question, Is the government too big to fail?
 
http://www.bloomberg.com/apps/news?pid=20601087&sid=alyBXwog9c4A&pos=3

             Futures are mixed this morning and a little under water to fair value. Expect a slightly lower opening.