Tweet

The Best of Times...The Worst of Times?

Written by: Gary Silverman

Article Overview: Today is March 12, 2009. I am identifying this day so you can get a perspective of where we are in the world. I don’t know about you but I am getting a little tired of what the media is exposing us to. Every statement seems to start with “during these tough times”, even commercials are getting on board with the negative jargon. Every statistic is peppered with “the worst since”, “highest since”, or “lowest since”. I question the mechanism for such quotes and who really cares? Even the weather has become “severe” weather with it’s corresponding lowest or highest recorded stats. I may regret saying this but I’m ready to hear more about Iraq, that has been pushed to the back page.

The Best of Times...The Worst of Times?

I’m going to divide the population into three distinct categories:

Those adversely effected by the economy.
Those fearful that the economy will eventually effect them.
Those that the economy is not effecting at all.

Here’s more of my spin on current events:

JOBS - I am sensitive to those people who have lost their jobs or feel they are about to, but there is a greater number of people working today than 10 years ago. Often times when people lose their jobs they become resourceful and many new products and businesses are born during these times. Isn’t it the entrepreneurial spirit that has made America great?

WALL STREET - We have learned that the price of a stock has nothing to do with the inherent value of the company. Is Citigroup really worth only $1.22 per share. Years ago when retail investors dominated the stock market long term investors bought and held shares in companies they had confidence in. Now some stocks are held for “seconds” at a time, quite the commitment. Why didn’t Exxon trade for $500 plus like Google did at the time oil was over $145 per barrel? Does the general population really care about the Dow Industrials? Do they even know that it is only 30 individual companies who’s make up has changed through the years with mergers, acquisitions, and bankruptcies?

COMMODITIES - Oil, Gas, Corn, Pigs, Gold, Copper, Soybeans are all traded by people who have no ability or desire to take delivery of the product. Ethanol was supposed to be our savior for rising oil priced and diminished supplies yet traded parallel to oil, so when oil went to $145 corn went up exponentially as did food and the transportation of food to your local Piggly Wiggly. Why should we allow someone who can’t take delivery of oil and refine it into gasoline bid on the price of oil as a speculator. I can’t buy anything wholesale why should they?

GOVERNMENT SPENDING - We are acting like this is a new concept. It is government spending that has led to the technology we have today as well as the lifestyle we enjoy here. Much of technology was developed through military and space exploration research, as well as grants to scientist to develop cures for our illnesses. We give the government our money in the form of taxes. If they don’t spend it, who will? We are all upset with the prospect of the government printing more money to fund our bailouts and deficits, yet how do you think our economy has grown over the past 200 plus years. Look in your pocket and tell me how many dollars you have that were printed in 1942. And do we not waste things as a society, money and natural resources to name a few. We are a disposable society. We waste, the government wastes... Why are we so concerned about “big government”? They provide jobs and services to make our life easier. It’s the “little government” on Capitol Hill that is the problem and they haven’t grown much through the years.

THE PERPETUAL CAMPAIGN - Immediately after an election politicians, after a few inaugural balls, start campaigning for re-election. They vote either against the sitting President or along party lines so they can point fingers and avoid attacks by whoever is slated to run against them. I am all for term limitations where a Senator, Congressman, or President runs for one term of between 6 and 8 years. Now go to work. The money spent on campaigning is far greater than the bailout money.

THE MEDIA - We are inundated by an overwhelming amount of interpreted electronic messages 24/7 particularly in the age of the internet. The news is “fact based opinions” not “Opinions Based on Facts” If the news was something other than an opinion than why are their diametrically opposed experts offering their opinions on the split screen. They all carry the credentials of credibility but when there are opposite opinions SOMEBODY has to be wrong. Depending upon who you believe may determine how you formulate your own opinions, be careful, they may be wrong. The brainwashing that we have experienced over the past year or more has become a self fulfilling prophecy. By creating fear and uncertainty we got ourselves into this mess. We had it too good for too long....let’s kill the goose.

BUBBLE - If you want to create a bubble warn everyone about the bubble. Now when there is a prolonged period of prosperity or success it will become a bubble. Should we have worried about gas going to $5.00 a gallon when we have the historic precedent of a technology NASDAQ bubble based on dot com companies there for the IPO’s whether there was a viable business model or not, the housing bubble, the Dow Jones bubble, and the commodity bubble?

DEFLATION / INFLATION - Both appear to be bad for business yet we always have one or the other. Deflation is bad for corporate earnings but good for people who want to buy cheap things (which stimulates the economy). Inflation slows down an economy which is bad for corporate earnings as it raises their cost of borrowing while limiting growth. The new irrational fear is that once we clear out of where we are today we will be left with rampant inflation. Remember, inflation is a relative measure of prices from one month to the next. Here’s my example. If gasoline that was $4.00 per gallon last year and is now $1.75 per gallon goes to $2.25 per gallon that would be considered rampant inflation of 29% even though it is 44% LOWER than the $4.00 per gallon price. Should the price now be relative to the HIGH or last month’s price? You decide.

I’ll have more to say in my next installment as things unfold. The economy and business in general has a lot to do with attitude, keep your positive. Congratulations to Citigroup who avoided “nationalization” by turning in the best profit numbers since 2007. Writing everything off last year proved to be a brilliant business move.

Related Articles
  Best and Worst
  The bad table
  Lessons from Worst Bosses
  Is The Economy Good Or Bad?
  Careful Consideration and Analysis

Article Tags: bankruptcies, citigroup, distinct categories, dow industrials, entrepreneurial spirit, ethanol, exxon, google, government spending, individual companies, mergers acquisitions, piggly wiggly, price of oil, retail investors, savior, soybeans, speculator, stock market, term investors, time oil



Related Forum Posts
Re: What is your worst / best month? - Best: October, November, April Worst: January, February, July
Re: What is your worst / best month? - Best = January, February and March. Worst = April (tac season) July and August (vacations).
Re: Info for would be franchisers... - [quote="Sebastien":1d29sdv1]Like Franchise Times, Franchise Update is a very practical magazine. There is no blah blah, just straight facts that anyone in the franchise community can relate to. I just want to mention that all these magazines are NOT franchisee oriented. I mean these magazines are for franchise professionals. If you're looking to buy a franchise, you won't find much information in there. To answer your question, getting published in Franchise Times was fairly easy. I don't want to brag too much but I think I am known in the franchise industry. I was the marketing guy at Franchise.com for a few years before joining my new company, the World Franchising Network. So people know me and I have a very good relationship with Nancy Weingartner, the Managing Editor at Franchise Times. I was talking with her at the last Franchise Expo South in Miami and she mentioned she'd like me to be profiled. I was like "ok, sure!". I like this franchise executive profile thing in Franchise Times as it is rarely BS. People are usually really natural in there.[/quote:1d29sdv1] Thanks for the follow up Sebastien! And I can't say that I'm surprised that networking with the right people and managing your relationships with them properly are the keys to being published. I guess the old adage holds true of "it's not who you know, but who knows you" that's important.
Does a New Company need a "Big" PR firm? - I've started work with a brand new company that is going to do loss mitigation. My boss intends to hire a "big" PR firm - ie one that costs a lot of money - because he wants press releases sent out to the New York Times, the LA Times - all the major papers around the country - and he think they'll be more likely to print them if they come from a "big" firm as opposed to a one-person PR firm. I think it doesn't matter where the press release comes from as long as its well written. What are the opinions here?
Re: Does a New Company need a "Big" PR firm? - [quote="OmnivoreInk":dmj1i0sv]I've started work with a brand new company that is going to do loss mitigation. My boss intends to hire a "big" PR firm - ie one that costs a lot of money - because he wants press releases sent out to the New York Times, the LA Times - all the major papers around the country - and he think they'll be more likely to print them if they come from a "big" firm as opposed to a one-person PR firm. I think it doesn't matter where the press release comes from as long as its well written. What are the opinions here?[/quote:dmj1i0sv] I think the most important factor is whether your press release will reach the most number of your target audience or not. It won't matter if the press release is well written if no one has the opportunity to read it. I also believe that credibility comes with having your press release in an established source like The New York Times, LA Times, etc... For instance, if you enjoyed playing tennis, who would you trust more? The advice from a recreational tennis player who has his own column in [i:dmj1i0sv]Tennis Magazine[/i:dmj1i0sv] [u:dmj1i0sv]or[/u:dmj1i0sv] the recreational tennis player who has his own blog? I don't know about you, but I'd listen to the guy on [i:dmj1i0sv]Tennis Magazine[/i:dmj1i0sv] over the blog owner at least 9 out of 10 times.


Share this article with your friends. Fund someone's dream.

Leave a comment below or share on the left and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.

Tweet

Newsletter

Get advice & tips from famous business
owners, new articles by entrepreneur
experts, my latest website updates, &
special sneak peaks at what's to come!

Name:
Email:

Popular Articles

Effective Leadership

The True Cost of Employee Turnover

Suggestions

Email us your ideas on how to make our
website more valuable! Thank you Sharon
from Toronto Salsa Lessons / Classes for
your suggestions to make the newsletter
look like the website and profile younger
entrepreneurs like Jennifer Lopez.