Author: Simon P Smith

Unless you have been living under a rock for the past few months you will no doubt have noticed the economy and financial markets are failing.

A Forcast Event

Many financial strategist have been discussing this for quite some time. Robert Kiyosaki even wrote a book about it titled “Prophecy”. Written in 2002 it discusses why the biggest stock market crash in history is still coming and how you can prepare yourself and profit from it.

Now it is here we can no longer shrug it off as some silly “doom and gloom” view… .

If it is going to be as bad as the gloom and doom merchants in the media are wanting us to belive most people haven’t felt the pinch yet. Any financial strain you’ve felt so far is just the tip of the iceberg compared to what’s headed our way. And the biggest impact will be on the middle class around Christmas.

Understandably, many people are scared as their financial future is far from being secure. Having said that it is not the time to be stuffing your money into your mattress or hiding under the bed.

You shouldn’t do that, nor should you panic. The regulators around the world are working hard and taking swift action to bring stability to the market. The best thing you can do is ride out the short-term ups and downs with just a few prudent adjustments where necessary until it all shakes out.

The Smart People are Planning Their Future

Don’t get caught in what I call the “herd mentality”. A little rule I have used myself when I find myself in a tight spot is ask myself “What is the herd doing?” And then do the exact opposite. Now is the time to take a common sense approach. Following are a few tips for a failing economy you may find useful:-

What You Shouldn’t Do

* Bail out. Right now everyone is running around dumping stocks or equity mutual funds now. This is silly as the values are especially low and it is simply guaranteeing that you’ll turn paper losses into real ones. Even if there’s more downside to come, staying on course often pays off during times of economic uncertainty. You’ll only realise a loss if you sell. What happens after a recession? A Boom. What happens after the sun sets in the west? It rises in the east.

* Stop saving. Those regular contributions you’ve been making to your savings or retirement accounts are an important part of good financial discipline, and there’s no reason to stop them now. The strategy of dollar-cost averaging your investments-making periodic contributions to your accounts, regardless of where the market is heading is still good advice.

* Speculate. While lower prices for investments create opportunities, betting on the markets can easily get you into trouble, especially with the wild swings we’re seeing now. Small, measured investments are usually better than large, hasty ones intended to make a quick killing. Be especially wary if you get tips from e-mail, the Internet, or elsewhere for certain stocks, commodities, and other “once-in-a-lifetime” opportunities

* Take on new debt. Be careful about acquiring new debt. Economic downturns can affect job stability and investment income, making it difficult to determine how much debt you can handle.If you must borrow, say, to put a child through college or make an emergency repair to your home, be doubly sure that you’ve examined all the options and risks, especially if you’re planning to use the equity in your home

* Stop living. Although these times demand extra caution, there’s such a thing as over-reacting. Whether it’s buying gifts for the holidays or taking your family on vacation, life has to go on. And some cutbacks can have negative consequences for your wallet, such as putting off maintenance for your house or car or canceling insurance policies. So don’t overreact. Instead reflect carefully and, where necessary, adjust.

What You Should Do

* Get your finances in order. There’s never been a better time to make a budget and start paying down your debt, credit card and otherwise

* Rethink your plans to retire. If you’re expecting to retire soon, consider holding off for a while, if possible, until things calm down. That will give you time to reassess and, if need be, modify your plans

* Speak with your financial adviser. With end-of-the-year tax planning an annual ritual, now is a good time to make an appointment with your tax adviser no matter what the economic outlook. He or she may have some advice on how to tweak your finances as you ride out the current storm.

* Consider a Plan B. Instead of being scared, I’m encouraging you to look at starting or ramping up your Plan B. It’s never been more important than it is right now to re-plan how you make your money.

You need to do something different to create a stable financial future for yourself. One of the easiest ways to to this is to have your own home based business.

Now is the time to take action and learn how to build your own home based business… to apply yourself… to work smarter not harder … to find the time to get it done.

So what’s the smartest thing a person can do to build their own home based business, or any small business in this economy-successfully, and without a lot of risk?

Network Marketing has been hailed by many as the ideal home based business. Network Marketing is the best home based business opportunity particularly if you find a mentor in the network marketing business of your choice. This is a great short cut to home based business success as the mentor has already successfully travelled the road you want to travel. Consider this network marketing mentor option.

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Author: Murad Ali

The American Economycan go either way according to most newspapers and television commentaries. The experts say that we have a 50% chance of going into a recession while some say we have almost no chance. Trying to decipher their confusing messages can be difficult. That leaves most American businesses unsure of what the future holds for them. Are they still going to be able to compete or are they going to suffer a slow and painful decline downwards. The best way to answer that question and determine how to improve the business environment is to look at the American businesses strengths and weaknesses.

Success and failure is all about strengths and weaknesses. When we rationally see the strengths and compare them against the strengths or weaknesses of other countries we can better determine our chances of success. It is almost the same as when you bet on two boxers one of which has endurance and the other one quickness. The one you feel will win depends in part on how you see the situation. If you feel the quickness will take out the opponent in the first few rounds then he is the better bet but if you feel that the two boxers are going the distance then endurance counts.

Looking at the American business world and comparing it to the challengers you can also see better who is going to win in the end. We know that the world is a high-tech place where efficiency and cost matter. The one who produces the cheapest products is likely to win as long as their products have reasonable quality and don’t break down often. With Chinese cheap products and America’s high quality both countries will need to come closer to the middle.

Strengths of American Businesses:

High Technology: Powerful and growing businesses require email, Internet, cell phones, computers, robots and more. The technological advances of the U.S. are difficult to surpass and few countries even come close. American businesses can grow simply because they can manage different international locations as though they were a block away. Few foreign countries can do this. In addition, America also has the ability to develop and implement modern technology like robotic arms and complex systems that increase productivity.

Power Supply: China is attempting to get its hands on as much natural resources and energy as possible. The U.S. is also doing this but is much further in the game. While the U.S. is moving towards alternative energy supply and thinking beyond fossil fuels China is still trying to accumulate basic energy. American businesses have no problem with black outs, rolling power outages or a lack of energy. This is a benefit because their environment becomes predictable.

Strong Law Enforcement: It may seem silly and out of place but a strong law enforcement system helps to keep the business environment fair and equitable. When businesses can be cheated when making partnerships, employees embezzle and politicians bribed there is lots of risks built into the environment. Businesses want to know there is a deterrent and opportunity to regain what is lost through unfair practices. You will find that China as well as most nations outside of Europe or the U.S. has difficulty curbing crime.

Sound Fiscal Policy & Self Adjusting Markets: American policy makers have been generally concerned with how well the economy is doing. The democratic system allows the population to remove senators, presidents and congressmen out of office when they are not producing results. Therefore, a single politician can complete little damage in a single term. When small mistakes happen the markets can adjust themselves by offering something new that makes money. For example, if people demand companies to reduce pollution then these consumers will gravitate towards clean businesses while leaving the rest of the businesses behind.

Weaknesses of the American Business:

Poor Public Education: The American education system is declining and children are falling behind much of the world in terms of science, languages, math, and more. The advancement of these core subjects are important for the improvement of society as the new high-tech world will need scientists and technology workers like never before. However, as we keep allowing skilled workers to immigrate our school systems are falling behind only because there is little direction and lots of politics.

High Labor Costs: Workers are cheaper then they are in other countries. The problem in the U.S. is that companies aren’t getting what they are paying for. The average high school graduate is barely able to grasp the concepts of a manufacturing business let alone work within it while the government raises the minimum wage. A Chinese worker is able to press a button like the American worker but for about 1/10th the cost. Only productivity will make the American worker worth his/her wages.

Taxes: American businesses pay a lot of money in taxes while companies from other countries may pay a lot less. The taxes in American businesses are simply extra overhead that must be pulled from the cost of the product. In a tight economy where people don’t want to pay extra the cheaper products (with less tax burden) will win out. Have you ever wondered what happened to the television and radio producers in the U.S.?

International Policy: America has come to mean, “bully” to many people overseas. To thwart America’s power is a sign of resolve and fashion. As our politicians continue to play favorites with countries that violate international law, demand compliance with American desires and try and finagle other countries its reputation declines. A bad reputation means that both international businesses and whole countries may not only distrust us but prefer to do business with someone else.

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Questions and Answers

Q- How bad will this economy get?

A- This downfall of the economy has really just started; in the near future you will see more local and national businesses shutting their doors, contributing the cause to many factors.  Some factors may include:  (1) gas prices - which hurt many services business cutting their normal profits in half or more while forcing them to pass on some of the fuel increases to the consumers (2) unemployment  - which causes people to save instead of spend, hurting more businesses and leads to more people without jobs and tons of bills to pay.

Do not be fooled by the government bailouts, they are doing the same thing most people do right before they claim bankruptcy - using credit card debt to pay off your bill debt.  I do not know about you, but when a government is taking on billions of dollars in debt to bail out the economy, we all need to be greatly concerned.  This means the average person probably will not be clicking their ruby slippers together while repeatedly asking to be sent home; because in reality their not sleeping, but wide awake and living a nightmare.

Q- If I loose my job, how will I pay my bills while I am trying to get hired somewhere else?

A- When someone is asking me this question, I really know that they are in a bad predicament.  This situation happens to be the single biggest reason why people have had financial problems and had to rely on bankruptcy (leaving hundreds of thousands of families without their homes, cars and basic amenities).

So to answer your question, yes you will loose everything if you can not figure out how to replace your income in a timely fashion.  No matter how far up on the feeding chain you are; if you have no income - eventually you will not be able to pay your bills.  It is very unlikely that you will find another job that will pay you in the same respect; other companies are much like the one you where fired from, and are trying to downsize their business as well.  

However, for those who have a secondary income or a full-time income that is not linked directly to our local economy or a job that they will not lose; those people will fair just fine.  You should take a look and find yourself a secondary income or home-based business that you can build before it is your turn to get downsized.  At this moment working a few extra hours every week to build a second income is not an option; it is a financial decision that could cost you everything.  I suggest that you begin as soon as you are finished reading this article.  To start, go out and find as much education on how to make yourself an extra income before time runs out.

We are living in desperate times, and those who have had their head in the sand trying to ignore what is going on will be the ones who are without food, shelter, transportation, proper education, income, health care, etc.  It is best to get going now before it is too late. 

By Jason Allen Miller

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