Daily Archives: November 23, 2008

Four Concepts for our investment

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There are four conceptual ingredients that you need to siphon out of your investment cocktail, and one to add: (1) Considering market value alone when analyzing performance ignores the cyclical nature of the securities markets and the world economy. (2) Using indices and averages as benchmarks for evaluating your performance ignores both the allocation of your portfolio and the individuality of the securities you’ve selected.

(3) Using the calendar year as a measuring device reduces the investment process to a short-term speculation, ignores all financial cycles, increases the emotional volatility of the investment markets, and guarantees that you will be unhappy with whatever strategy or methodology you employ. (4) Buying any type or class of security, commodity, index, or contract at historically high prices and selling high quality companies or debt obligations for losses during cyclical corrections eventually causes hair loss and shortness of breath.

And the one to add- The Working Capital Model.

The power of Population growth

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Population-economic development; that sounds like the mentality that drives most city managers to build, build, build. At times it pays off, it has been working well for the state of Virginia, people keep moving there and they can’t seem to build the infrastructure to handle the influx fast enough. It also paid off generously for Georgia in the nineties.

But what about cities and states that have already been through that phase and are trying to struggle to maintain the few people they have? With few exceptions, like New York City, a lot of Northern states, and particularly Midwestern states, seem hard pressed to keep people around and if anything are loosing residents, some to the suburbs some to other cities or states altogether.

How do those metropolitan areas bring people in; much of the focus seems to be on bringing in wealthier residents into the inner city where rehabilitated aging structures offer both the proximity to downtown and the rich history of the turmoil that the city was built upon. The poor are forced to move to suburbia, as they are priced right out of the city and rather than actually build the population the city has succeeded in replacing one resident with another.

What may be key here is that cities seem to be about bringing “quality” citizens to the area, as opposed to just sheer numbers of people. Most cities cannot handle the sheer volume of people that want to move into the metro area as they used to, so they are focused on individuals that can actually help out the city with some of their objectives, like generating extra tax revenue, and creating an environment in which corporations would actually want to move into the city without having to give away the kitchen and bribe everyone through manipulating the taxes that businesses have to pay. That is part of the reason why most businesses initially moved to the suburbs in the first place.

In another sense how does population contribute to the economic growth of individual nations? Look at India and China, the worlds largest countries are growing at an astounding rate, which may put them in a better position to compete with the United States and Britain but is everyone benefiting from this approach to economic development? While both India and China have a legion of workers it doesn’t necessarily follow that all of them are making competitive wages and enjoying the quality of life that you see elsewhere in the road. An AFP article “India’s poor left behind by blistering growth: minister” suggests that the Indian population itself isn’t much better off as a fourth of all Indians are still living in poverty. Yet their population is up by 9%.

A growing population may bring up the bottom line in some aspects but it also creates a burden on the infrastructure to both educate and house individuals that most areas or regions are not fully prepared to deal with. Technically you should be able to live in the city and not have to concern yourself with it’s infrastructure, but the growing pains of some areas have made it a regular concern for some preoccupied with the issue. If you are willing to train that individual to become part of the “ultimate resource” you are looking for, can inspire them to stay rather than take their talents elsewhere and give them a sense of autonomy in which they turn around and create their own businesses and build their own neighborhoods to bring even more people in then from the aspect of number crunching your investment has paid off wisely. But if individuals end up even poorer or in worse conditions than they were in from where they left, as has often been the case in history, your “ultimate resource” ends up being more of a liability ..

HOW DO YOU RECESSION PROOF YOUR BUSINESS?

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HOW DO YOU RECESSION PROOF YOUR BUSINESS?

its important that you know the difference between a successful business and one that sucks the life out of you. Many entrepreneurs think they have a cash pumping business but in actually it is the cash that gets PUMPED OUT OF THEM! In short, they have a very expensive hobby.

The BIG QUESTION is….. (drumroll please)

What Creates A Recession?

I’m sure you got a text book answer. I can think of several myself. One of the things that comes to mind is that you have a disastrous guy in charge somewhere who calls all the shots. He does a shoddy job at best but still has the ear of the boss. As far as the man in charge he takes his cues from another era where the marketing made little sense then as well. He likes expensive advertising and has convinced himself that this stuff actually works.

I am talking about advertising in things like radio and television. You could get away with that stuff in the 1960’s back when you only had three networks, ABC, CBS and NBC. But now you got 900 digital channels, pay per view, HBO1, HBO2 and well you get the idea. Lets not forget the multitude of digital radio stations too. Getting someone’s attention now is going to be a heck of a lot harder than you thought.

How do you break through the CRUD?

When you need leaders you need people who can think on their feet. It’s a good idea to get someone who can actually push your vehicle out of the mud.

This means trimming the fat. You have to cut the ties with outdated thinking and things that will bleed your account dry, (television and radio being just the beginning). Your business could be in the dumpster because of outdated thinking.

Here are just a few things that could help you elevate your position in wealth.

1. Getting more of your business into ongoing profit generating systems.
2. Automating all of your sales pitches online.
3. Automate the way you accept payment for just about everything you do.
4. Find new ways to create streams of outgoing information without being on the phone.
5. Creating ways of making money and eliminating as much “face time” as possible.

Its not that I want you to stop liking people as a whole. On the contrary I am looking out for you. That is we have to take care of the boss – namely – YOU. And you cannot do that if you are running around all over town meeting with everyone who calls you on a whim.

I got a rule of thumb about this entire prospecting thing. I rarely ever meet with anyone in person unless I am sure they are going to be worth my time. I try to take care of this through online technology as much as possible.

The Power Of Automation

I set up roadblocks when I can. I try to create an online outlet for my prospect to get more information before they actually pick up the phone and contact me. I do not want to be on the phone all day although that sometimes happens. My prospects usually find a pre-recorded “movie” that explains my services to them in some form.

This really works wonders if you are dealing with people who are in a recession frame of mind. If they are normally close minded to new ideas and new thinking then putting your presentation on autopilot on the web — works! In fact it can work so well that it will create two dynamics for your business.

1. People will disqualify themselves and not bother calling you in the first place.
2. People will qualify themselves and call you with check in hand, (I’m serious)

You can set up all of your marketing on auto pilot. I record all of my online sales pitches. I accept FAXES online morning, day, noon and night. I have online web sites that accept payment and deposit them straight into my bank accounts. I run all of my presentations on my many web sites and blogs I have out there in cyberspace. And boy do I get the leads and jobs. I get stuff from all over the country from cities I have never been to.

This stuff really works.

What Business Are You In?

Remember what business you are in. You are in business to primarily MARKET your business. It’s not to learn the latest tricks in .NET development, SEO, cosmetic dentistry, even though you should be competent in the thing you specialize in. Your real skill as a businessman is to know how to market your services and how to land customers. If you don’t have that then you cannot do too much. You need to perfect this stream of steady leads day in and day out.

I recommend duplicating this format whenever you can. It may take a while to get this to work for you but it can be built. The idea here is to create pages that support every profit leg of your business. You have to prime the pump to get this going. Once it is built you can enjoy a day off now and then.

Who knows – maybe you can even take a nap. If you are a full time entrepreneur no doubt you deserve one.