Chances are that if you are doing your research on starting a business in this global economic downturn, you fall into one of three categories: you have lots of extra cash to invest, you are quite possibly insane, or you have that entrepreneurial spirit that seeks opportunity in times of crisis. Whatever the reason, you should be congratulated. It is people like you that will bring the world economies back to life.
Owning and running a business can be very rewarding or very frustrating, depending on how you go about it. So just what is the best business to start in this down economy? Regardless of which particular one you choose, follow these guidelines to make sure that you have the greatest chance to not only survive, but prosper.
Like the lines on the edges of the road, cross at your own risk. All businesses – and therefore all jobs in the private sector – must operate within (“length” and “width”) of these boundaries. Business failures occur when companies fall behind the times and are too far ahead of consumer demand. Likewise, most business sectors have a relatively narrow range of successful operations. It’s hard to survive if you are either the most expensive or cheapest in your market.
The 2010 book from David Wiedemer, PhD, Robert Wiedemer, and Cindy Spitzer entitled “Aftershock” examines the events that created the financial meltdown. In this book and the previous book, “America’s Bubble Economy” the authors make the case that the U.S. economy was an illusion, only the interaction of “bubbles”.A bubble is created when an asset temporarily booms. The former (pre-2008) U.S. economy was comprised of bubbles in real estate, personal loans, credit card debt, the stock market, and consumer spending. On their own, each bubble can rise independently. But in combination, the bubbles accelerate and reach unnatural levels. More info here.
The financial meltdown felt around the world is the consequence of these bubbles popping, or as the authors describe it, a “Bubblequake”. The first stage of the financial meltdown included the fall of the real estate bubble, private debt bubble, stock market bubble, and discretionary spending bubble. On their own, each would have been significant. Combined, these popping bubbles lead to “The Great Recession”.Amidst the economic turmoil, the U.S. government tried to intervene. Bailouts of automakers and investment banks were designed to compensate for “toxic assets”. Then the government pumped billions into the economy as “stimulus” to try to offset the funds lost to “money heaven” as bubbles popped and wealth simply evaporated.
Are you new to the Indian stock market and feel lost at the mere mention of financial terms such as shares, debentures, stocks, bonds, equities, etc.? To begin with, you need to know the different types of investments. They are a means of investment money by lending money to others. They are debt instruments that are issued by governments, corporations and other entities in order to finance projects or activities. It is a loan that investors make to the bond’s issuer.
Debentures are also debt instruments which guarantee to repay the principal of the loan along with interest to the bondholder. It is a document that creates debt or acknowledges it. Often a term interchangeably used with bond, debentures are like certificates of loan. The price of one when it is first issued is usually the amount of money that is being lan utan uc, and is referred to as the bond’s face value. In exchange of this loan the investor receives interest known as the bond’s coupon. They are issued for a specified period of time such as 1 year, 3 years or even 30 years. When the end of this time period is reached the issuer has to repay the loan to the investor.
For e.g., if you want to expand your company and increase the number of shops; you could issue bonds to the public instead of going directly to the bank. Suppose Rahul buys them at their face value- INR 1000 at 8 % interest rate (coupon) with a maturity of 10 years. Rahul will get 8% of INR 1000 over a period of 10 years, i.e. INR 80 per month. (8% of INR 1000)At the time of maturity, at the end of 10 years, you could return the INR 1000 investment. Rahul could also sell his them before the time of maturity.
Corporations often issue them to fund capital projects, while governments issue them for public projects.
The number of loan products have increased over the past 20 years as economic necessity and a demanding public in need of specialization to solve financial circumstances. From personal loans, educational loans, business loans and even municipal loans to touch on a few required various industries to be creative. The entities that took part in the creation of the various financial products are actuaries, risk management professionals, “information and informatic engineers” and Wall Street amongst others. It was necessary to create, enhance or break down for better or for worse loan services and products to keep money fluid in a diverse marketplace that required funds to address niche demographics.
Signature Loans – A signature loan is just as it sounds. One applies for a loan and gives a signature on a promissory note to repay the loan in a certain amount of time. That amount of time is called a “loan term ” and may be from six months to five years. Signature loans usually require good credit and the criteria for loan approval are mostly based on the borrower’s credit and and to a lesser degree on assets. Not all signature loans have the same parameters for qualifications.
The institution may or may not place a lien on the assets but nevertheless wants to have documentation proving that there are indeed financial or physical assets owned by the borrower. Signature loans usually come with lower interest rates than other types of consumer loans like payday loans, credit card advances, title loans and some car loans.
Telegraph.co.ukBusiness news and markets: liveTelegraph.co.ukEuropean Union finance ministers are meeting in Brussels today and tonight to hold intense talks to set up "single resolution mechanism" (SRM) allowing the eurozone to shut down a failing bank without bailouts from taxpayers. George Osborne, the ...and more »
Global Financial Training Program Reveals Alternative Ways to Finance Your ...PR Web (press release)Global Financial Training Program's new blog educates and shares promising news for businesses that have been turned down by the bank for loans and are looking for alternative ways to finance their business. In this economy, banks are turning down 90% ... […]