Batesville and the Economy
Today the Dow Jones Industrial Average dropped over 500 points for a 4.4% reduction. The S&P 500 dropped 59.00 points (4.7%). Bank of America purchased Merill Lynch and Lehman Bros. has filed chapter 11 bankruptcy, the largest bankruptcy filing in American history. What to do during these uncertain times is of concern to most who have an awareness of how interconnected the economy is. Now I'm no economist but I have some thoughts on the economy and your money that I believe could help you during these times of economic uncertainty.
The core problem with our economy is greed. This greed has driven banks to loan money to people that were not able to pay their debt. These loans were made because the banks are desiring to make money in the form of interest rates and penalties from people. Don't get me wrong. Banks perform a very valuable service in our economy, however, overly greedy lenders have bitten of more than they can chew all in the pursuit of money.
To add to this problem we have a national debt that is so large there's no way to humanly understand how big it is. I've heard one commentator say that the national debt is large enough that if you stacked 100 dollar bills, the stack that could pay off the national debt would go all the way to the moon. Now that's a lot of money. So the solution is to lower interest rates and print more money. The only problem with printing more money is that the value of that money begins to descend as a result relative to other currencies. If you haven't noticed, the value of the U.S. dollar has dropped significantly in the past year.
We all know that here in Batesville we are not immune to the problems with our economy. Skyrocketing fuel costs have led to higher costs on everything that gets shipped. The cost of groceries in Batesville have alone become a significant issue. Not to mention we are a rural community with many smaller towns on the outskirts of Batesville being impacted as well.
My advice to Batesville residents is to get out of debt if you can by selling unnecessary depreciating assets like expensive cars and big screen televisions and invest your money into tangible assets like income producing real estate and precious metals.
Support a ministry that is feeding you spiritually, live below your means and live frugally. You'll have less stress and truly live happier.
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great information, Tony...
ReplyDelete"get out of debt"... sigh... one of these days!!!
How Small Businesses Can Survive the Coming “Economic Winter” -- Learn from the Cockroach
ReplyDeleteBy Herb Lawrence, ASU SBTDC Center Director
At the recent 2008 Arkansas Venture Conference in Little Rock an unexpected nugget of wisdom came from our luncheon speaker, Mr. Josh Quittner, editor at large for Time Magazine and contributor to a tech blog for Time.Com. The essence of his speech was surviving the coming economic downturn. He compared the economic uncertainty to a nuclear winter and those businesses that would survive must be “business cockroaches”. Scientists predict that in a Nuclear Winter the species most likely to survive would be the cockroach. These bugs are survivors, thriving in difficult climates, going long periods without food or water. While all business owners would rather think of themselves as gazelles, speeding to profits and success, to emerge at the end of the Economic Winter these are the things that smart Business Cockroach need to do NOW:
• Have an Immigrant Philosophy - Live within your means – frugality now.
• Get Your Cash Flow Positive NOW Do whatever it takes to stay liquid FIND Cash - sell unneeded assets, cut back on the cash taken out of the business, secure revolving lines of credit.
• Spend Smart Review financial statements constantly, cut the FAT, but keep the muscle. Work with customers, vendors, lenders to reduce or eliminate expenses
• Be Hyper Competitive Get AGGRESSIVE on marketing to your customers. Now is NOT the time to cut marketing dollars.
• Focus on your Essential Business Feature(s) Make sure your product or service is profitable, but know how these features impact customers.
• Get Obsessive about Data Knowledge is Power - Know financial benchmarking; industry trends, Subscribe to on line e-zines on business and spend time each day reading.
• Uber Communicate Over communicate with everyone who can help you survive - customers, employees, lenders, vendors, everyone.
• Have a Back-up Plan If all else fails do you have a realistic exit strategy?
Those businesses that apply these simple cockroach strategies will survive the Economic Winter to emerge when the spring comes.