Springfield-Greene County Library Minding Your Business
Business news from your Library

• What's Hot & What's Not
  

  U.S News & World Report has come out with a list of fifteen cutting-edge businesses that have an excellent chance to succeed in todays' gloomy economy.  They've stayed away from fads and flash-in-the-pan ventures.
  
  For entrepreneurs, however, the present economic climate has peril as well as promise.  So U. S. News also details the five most overrated small-biz opportunities.  Are you surprised that contracting and restaurants make the list?  (Springfield, by the way, has roughly one restaurant for every 142 households.)

• And the Band Played On
  

  "Yes, there have been 1.9 million jobs lost since the start of the recession last year...  But that still leaves 93.3% of us employed.  Close to 10% of homeowners have either missed a house payment or are in foreclosure...  But 90% of us are not in danger of losing our homes.  Yet we are wary."

  There's a spreading virus of instability.  Yet Warren Buffett's rule of thumb is to be fearful when others are greedy and to be greedy when others are fearful.  This bucks the tide of the dominant (although shortsighted and irrational) tendency to presume that the economy must continue to walk the immediate path of today and the day before.

  Buffett (and others) are well aware of 1975, 1980, 1990, 2003, and 2005.  Despite prevailing doom and gloom resulting from relentlessly poor economic figures, the stock market rebounded 23% (on average) during each following twelve-month period.

  Has the worst passed or is it yet to come?  The alert investor, business owner, and consumer will want to focus on facts rather than fears.

• When Entrepreneurial Skies Are Stormy
  

  Times are hard for many small businesses.  Times are even harder for small businesses that are just trying to get off the ground.
  
  Suppose there was somewhere that small businesses could go to get free, highly experienced, highly diversified mentoring?  Suppose it was local and readily accessible?  Suppose that it could accomodate quite a range of scheduling issues?

  No need to suppose.  The Springfield/Joplin chapter of SCORE (Counserlors to America's Small Business) provides free and confidential business counseling tailored to meet the needs and objectives of most any small business.  Workshops are also offered for a modest fee for both start-up and functioning small businesses.  SCORE's goals are meet through its volunteer membership, made up of real-world present and former business owners and professionals with expertise in accounting, finance, marketing, management, business plan preparation, insurance, and many other areas.

  SCORE members donate thousands of hours to help small businesses succeed.  If you have an underperforming small business, a small business that you're ready to take to the next level, or if you're wondering whether a small business could be part of your future, contact the local SCORE chapter.  You've got nothing to lose and much to gain!

• Risk + Greed = Catastrophe
  

  Michael Lewis has been called the funniest serious writer in America.  He casts a wide net, as evidenced by the books Liar's Poker (bond traders in the late 80's), The New New Thing (Silicon Valley), The Real Price of Everything (economic classics), and Moneyball (the economic aspects of baseball), among others.
  
  His latest book (Panic: The Story of Modern Financial Insanity) is scheduled for publication in early December '08.  Beginning with the crash of '87, he looks at the distinctive elements of that and each subsequent financial upheaval.  He also makes some attempt to consolidate what we should have learned from each event into an estimation of root cause.  But, as he sadly jokes:  "Not only does financial history seldom repeat itself, it seldom even rhymes."
  
  An interview with the author and an excerpt from his book can be found on the NPR web site.  And if Black-Scholes sounds to you like the name of a sanitary landfill, visit the site and find out that it's something even less attractive and sweet smelling.

• Disposing of Income That We Don't Have
  

  In 1959, debt made up 58.8% of a typical household's disposable income.  In 2007, the figure jumped to 141.3%.  Mortgage debt (103.3% in 2007) was 37.1% in 1959; consumer credit went from 16.3% ('59) to 25.1% ('07).  Particularly disturbing, when one considers the recent Commerce Department report that consumers' disposable income has suffered its worst recorded decline.

• We're All in This Together
  

  A glance at the year-to-date percentage change for major international stock indexes is a stark lesson in global economics.  Only Caracas (Venezuela) showed a single-digit YTD loss this afternoon; losses of 30% to 50% were quite common, with RTS (Russia) off an astounding 74.9%.
  
  As of May, Russia had 87 billionaires, second only to the US.  At least half of them probably will lose their billionaire status in '09.  In the past five months, Russia's top 25 high net worth individuals have seen something on the order of $230 billion fly the coop.  A bizarre offshoot of this is that many magnates and oligarchs have taken to spending most of their time on their yachts; whenever they stroll about on shore, will angry crowds of shareholders, pensioners, and unemployed workers show up to pelt them with rotting fish and drive them aboard again?

• Lethal Plasticizing
  

  Amidst a business credit drought, more small businesses are relying on credit cards for everything from capital investment to putting gas in the delivery van.  Using personal credit cards for these purposes is a bad idea.  But business owners may not realize that even company credit cards are personally guaranteed--late payments on such a card could affect a business owner's personal credit score.  A business credit card also has fewer consumer protections than a personal credit card.
  
  As small-business cards have pretty thoroughly replaced lines of credit, company owners have become painfully aware of revolving balances that grow as interest rates rise and of the fact that lenders are quite capable of raising rates and reducing credit limits--at any time and for any reason.
  
  A more sensible alternative might be a credit union business loan.  Credit unions have not been exposed to the same losses as other financial institutions, enabling them to up their business lending by 36% in the first six months of this year.

• The Polls Show ...
  

  What is normal?  Many Portland Business Journal readers believe the Dow will return to normal by the end of the year and that normal is between 9,000 and 11,000.

  Florida is not normal.