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Bull and Bear – an optimistic and pessimistic view of investment news. Today’s stories: Google:  saint or sinner? Spain lurches back into recession. Lagarde warns of 1930s moment. Posen says things are getting better. Companies in the news: Carillion, Aberdeen Asset Management, Jupiter, Henderson, Hunting.

Google:  saint or sinner?

Google has been praised and damned.

The company, whose corporate motto is ‘don’t be evil’, has been praised by human rights groups, but accused by rivals of doing the very thing its motto says it won’t. Human rights groups like the fact that Google has had a change of heart, allowing users of Google Plus to be known by pseudonyms. So that’s good if you live in a country where human rights are not fully appreciated, and you express views that – how can one put it – are not altogether in keeping with the views of your government.

It is just that not everyone is impressed; some say that the new Google Plus system does not support human rights at all, because, well, more of that in a moment.

First let’s hear what Google’s rivals are griping about. The problems relate to a new function on its search tool called ‘search the world’. First of all, the new search tool taps into your Google Plus account (if you have one, of course) and then tailors search results accordingly. That in itself is worrying, and is the subject of a forthcoming thought for the day. But the new tool also displays results linking to posts and profiles on Google Plus. What it doesn’t do is show the equivalent material on Facebook, Twitter, LinkedIn, etcetera. And critics say that is illegal, and will make the company vulnerable to anti-trust law suits.

Google has retorted, saying: “No, it is not like that at all.” It only searches Google Plus, because it is technically not possible to search non Google products. It says, for example, that Twitter makes it impossible to search deeply into its site and store information.

But now the debate has moved on a notch. Some developers have formed a group called ‘Focus on users’, which claims to have developed a piece of code that be used instead of Google’s ‘search the world’ and it can perform some of the very tasks Google says are impossible.

It seems Google is treading the same path that so many successful companies have gone down previously. Microsoft is seen by many developers as the evil empire. Google was such a hit with those very same people thanks in part to its ‘don’t be evil’ motto. But the bigger it gets, and the more successful, the more pressure it is under to maintain profit growth, and consequently the more disliked it is by some members of the software community.

And returning to the initial point about pseudonyms, it appears Google’s halo is not even quite so clear in this area either. Some say the company isn’t making is possible for users to present themselves under pseudonyms at all, but rather by using nicknames, and furthermore, the users’ accounts will still have details of their full name. So that won’t be helpful for human rights after all.

Part of the problem is that most of us find all this quite hard to understand. It is tempting to say Google should have a new motto:  ‘don’t be complicated’. It is just that while many are really struggling to get to grips with social media, for many others, the whole thing is child’s play. But these are important issues, and it is important that the public has an understanding of the considerations at stake here.

Spain lurches back into recession

Spain’s Central Bank has estimated that the Spanish economy contracted by 0.3 per cent in the final quarter of 2011. If the bank is right, it was the first quarterly contraction since the end of 2009.

The consensus forecast for Spanish growth this year is that the economy will contract by 0.4 per cent. Capital Economics reckons the consensus is wrong, and the contraction will be more like 1.5 per cent. Frankly, Capital Economics is far more likely to be closer to the truth, and even its forecast may be too optimistic.

Lagarde warns of 1930s moment

Bear:     IMF supremo Christine Lagarde said, in an interview on the BBC, that the global economy is in danger of lurching back into a 1930s style depression.

She said: “Looking at it from this perspective, 2012 must be a year of healing. But as Hippocrates put it long ago: ‘Healing is a matter of time, but it is sometimes also a matter of opportunity.’ “And today, it has to be an opportunity of our own making. Otherwise, we could easily slide into a 1930s moment.”

She continued by saying this 1930s moment could be the point where “trust and co-operation break down and countries turn inward. A moment, ultimately, leading to a downward spiral that could engulf the entire world.”

The trouble is that Ms Lagarde is probably right.

Posen says things are getting better

Bull:       Maybe, but when an arch bear gets cheerful it is time to feel more positive.

Adam Posen is the man at the Bank of England who has been consistently voting for the UK’s central bank to do more. Last year, he voted for more QE, when other MPC members voted for a hike in interest rates.

And now, he says things are a little better.

He was at Nottingham Trent University, and it was there where he struck his positive note while talking to reporters. Why so cheerful? Well, he was referring to measures taken by the Bank of England and the ECB, and the recent run of good news out of the US.

He also raised a question mark over the effectiveness of QE, saying: “A big problem for not just the UK but for all of the West – and I’ll put Japan in this category as well – is that people are very reluctant to take on risky investment. In the short run, that’s the real problem

“Now we give people free money and they say: ‘Oh good! I can pay off some debt and leave it in my bank account.”

He is right of course, and in fairness to Mr Posen it was he who suggested QE should be used to buy bonds in a public bank charged with the task of lending to small businesses, thereby in part getting around the problems he alludes to.

But then Mr Posen got pretty bullish. He says he is worried about productivity growth, and reckons that there has been a modest decline in the UK’s potential output thanks to the recession. But he also reckons that once things get back to normal, the UK will grow at 2.2 to 2.3 per cent a year. That’s slightly less than the 2.5 per cent it was enjoying before the crisis, but pretty good nonetheless.

Mr Posen has had some good ideas. And in many ways he has been proven right. But in his forecasts for future growth he is surely wrong. And he is wrong in the sense that getting back to normal might be much harder than he says. He is also wrong in the sense that if we can get back to hitting our potential, given all the technology innovation that is going at present – nano-technology for example – a growth of just 2.2 per cent would be a big disappointment.

Companies in the news

Bull:       This morning the ‘Telegraph’s’ Questor hailed construction services company Carillion as a buy. It was impressed with recent contract wins – including work on the M6 and three academy schools – but above all sees a recent sell off as an opportunity. It likes the forward earnings ratio of just 7.4 and a dividend of 5.1 per cent.

In the ‘Independent’, investment managers came under the spotlight. It likes Aberdeen Asset Management, which it sees as quite cheap following a recent scandal relating to split capital investment trusts, and says Jupiter may be worth a punt.

Bear:     The ‘Independent’ was not so keen on Henderson, however.

Bull and Bear:    Finally, Tempus in the ‘Times’ took a look at engineering and services firm Hunting. The company focuses on oil and gas, and Tempus likes its North American shale and conventional markets and was impressed with progress in its Singapore division, but fears the share price has risen such that investors should only buy on draw downs.

These views and comments are those of the author alone and do not necessarily reflect the view of The Share Centre, its officers and employees