Faithless is he that says farewell when the road darkens. J.R.R. TolkienMany of us who grew up (or at least grew older) in the tech industry tend to be bemused by the raw panic that is prevalent these days with the economic “crisis”. Borrowing capital is tough whether it’s for business or personal. Geez, they actually make you qualify in order to borrow money.
A good friend of mine who makes his living in the home finance business likes to say that things have only reverted back to how they used to be before banks lost the ability to say “NO”. I grew up in a time when not only did you actually have to show some ability to repay borrowed money but also produce some collateral that would back the loan if something happened. Wow, what a concept.
How’d we get here?
Things started to get fuzzy during the 80’s with Uncle Ronnie’s trickle-down economics (voodoo economics critics called it) and the economy kicked into high gear. Property values skyrocketed, the ability to borrow money based upon the future not the present was in vogue and the stock market started to be played by some brave souls who were not Wall Street experts.
My mother worked for a farm credit institution back then. She was relating to me the other day that the housing market crisis today is an exact replica of the farm credit crisis in the 80’s. Farmers were getting loans too big to buy equipment they wanted rather than needed on inflated land values that couldn’t stand up over time and it was being forced by Congress.. She watched this current situation unfold with one hand over her eyes going “Lordy, I know how this movie ends”.
Then the 90’s came and Wild Bill took a good (albeit dangerous) thing and opened it up to everyone. Not only were loans based upon nebulous futures but you no longer had to show proof of ability. In fact, large institutions were threatened with lawsuits if loans weren’t made to low income, non-qualified individuals. Plus now the stock market was opened up to Joe Plumber. By the way, Ronald Regan once said “never confuse the stock market with the economy”.
Unfortunately W became obsessed with war and let the bad decisions ride on. The new millennium has been a roller coaster ride for the ages. The highest of highs and the lowest of lows and we still have over a year left in the first decade.
So what’s an entrepreneur to do? Well, it’s somewhat of a gut check time. Do you believe that our capital system will win out over the potential of a government run economy?
My good friends at Pragmatic Marketing (http://www.pragmaticmarketing.com/) are doing a follow up to their successful book “Tuned In” by writing an e-book “Winning in a Down Economy”. You can check it out on their blog http://www.tunedinblog.com/. They're talking to a lot of people and will have interesting, pertinent and timely information that'll be worth paying attention to.
This is either the best time in years to jump in and invest in something you believe in or it’s the best time in years to lay low, hold on to whatever you can and see what 2011 looks like.
As for me? I’m taking a chunk of my retirement money and opening a business.
Things started to get fuzzy during the 80’s with Uncle Ronnie’s trickle-down economics (voodoo economics critics called it) and the economy kicked into high gear. Property values skyrocketed, the ability to borrow money based upon the future not the present was in vogue and the stock market started to be played by some brave souls who were not Wall Street experts.
My mother worked for a farm credit institution back then. She was relating to me the other day that the housing market crisis today is an exact replica of the farm credit crisis in the 80’s. Farmers were getting loans too big to buy equipment they wanted rather than needed on inflated land values that couldn’t stand up over time and it was being forced by Congress.. She watched this current situation unfold with one hand over her eyes going “Lordy, I know how this movie ends”.
Then the 90’s came and Wild Bill took a good (albeit dangerous) thing and opened it up to everyone. Not only were loans based upon nebulous futures but you no longer had to show proof of ability. In fact, large institutions were threatened with lawsuits if loans weren’t made to low income, non-qualified individuals. Plus now the stock market was opened up to Joe Plumber. By the way, Ronald Regan once said “never confuse the stock market with the economy”.
Unfortunately W became obsessed with war and let the bad decisions ride on. The new millennium has been a roller coaster ride for the ages. The highest of highs and the lowest of lows and we still have over a year left in the first decade.
So what’s an entrepreneur to do? Well, it’s somewhat of a gut check time. Do you believe that our capital system will win out over the potential of a government run economy?
My good friends at Pragmatic Marketing (http://www.pragmaticmarketing.com/) are doing a follow up to their successful book “Tuned In” by writing an e-book “Winning in a Down Economy”. You can check it out on their blog http://www.tunedinblog.com/. They're talking to a lot of people and will have interesting, pertinent and timely information that'll be worth paying attention to.
This is either the best time in years to jump in and invest in something you believe in or it’s the best time in years to lay low, hold on to whatever you can and see what 2011 looks like.
As for me? I’m taking a chunk of my retirement money and opening a business.
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