“I believe that banking institutions are more dangerous to our liberties than standing armies.” Thomas Jefferson
Last year before my mojo was stolen, when the economy was merely bad and hadn’t yet become truly stupid, I wrote that this was either the best time to jump in and invest or wait it out. Dark Days Indeed. I also mentioned that my decision was to jump in and start a new business.
Now, it’s not a big business and certainly not something I’d give up my day job for, although there are probably those that would claim they wouldn’t be able to tell the difference. But I am blessed (and cursed) with owning a beautiful retail space in a great little downtown that happens to be empty since it’s where my late wife Bonnie had her business. By virtue of the fact that it was originally a gas station it has a large street side patio area that now has landscaping where the pumps used to be.
Bonnie, the true visionary, always looked at the space and thought it would make a perfect wine bar, especially with the patio included. So why not? I love wine, I have the space, and it’s not like people are knocking each other over to lease the space in these times. So I’ve been systematically moving through the steps.
Here’s where it starts getting stupid. I learned of a state program to assist small business owners improve the appearance of their facility. Cool. Although my patio area is beautifully landscaped it’s not conducive being a good area for commerce. In other words, it needs to be totally redone. Perfect situation for the state funds, right? Uh, not so much.
Here was the exchange between the State of Michigan and my city representative: SoM: “Is this the place?” City: “Yes”. SoM: “It’s already been improved.” City: “But it doesn’t work for the business he wants to put in”. SOM: “But it’s already been improved”. City: “It’s been landscaped, but it needs to be fenced in and be restructured for commercial use”. SoM: “But it’s already been improved”. And so on.
Needless to say, I’m getting no state money.
Then there’s my bank – my commercial bank. I won’t bore you with the exact dialog but the essence of the conversation comes down to that I have plenty of equity and great credit, but, uh, well, the best I can make out banks don’t make loans any more. Actually to be more accurate, the quote was “we’re making no loans to anyone at this time”. So, I’m not sure exactly what they do, but providing capital doesn’t appear to be one of them. I asked my handler from the bank what their Mission Statement is. When he fumbled for an answer I suggested they use the Hotel California missive. “You can check your money in but it can never leave”.
So essentially the only way you can get money these days is if you take your big company, manage it badly, break all the rules (and a bunch of laws) and then beg the government to bail you out; which they will do and as a bonus not put any oversight on what you do with the money.
Therefore I’m thinking too small. There’s no reward for being sensible, I need to greatly overreach my bounds and when it doesn’t work out I’ll just beg for one of those $250,000+ jobs being created by the stimulus package. I mean, if the package costs $787 billion…I’m sorry…BILLION…and it’s going to created 3 million jobs then each job is worth $262K. Not bad, I could make that work.
So, where’s the XOD advice in this post? Well, for one read the Pragmatic Marketing blog Tuned In where they talk about the 10 steps for winning in a down economy. The other, I guess, is don’t look for help from anyone closer than yourself these days. And you know, that’s probably as it should be anyway.
Thank you, doctor. I feel better.
Last year before my mojo was stolen, when the economy was merely bad and hadn’t yet become truly stupid, I wrote that this was either the best time to jump in and invest or wait it out. Dark Days Indeed. I also mentioned that my decision was to jump in and start a new business.
Now, it’s not a big business and certainly not something I’d give up my day job for, although there are probably those that would claim they wouldn’t be able to tell the difference. But I am blessed (and cursed) with owning a beautiful retail space in a great little downtown that happens to be empty since it’s where my late wife Bonnie had her business. By virtue of the fact that it was originally a gas station it has a large street side patio area that now has landscaping where the pumps used to be.
Bonnie, the true visionary, always looked at the space and thought it would make a perfect wine bar, especially with the patio included. So why not? I love wine, I have the space, and it’s not like people are knocking each other over to lease the space in these times. So I’ve been systematically moving through the steps.
Here’s where it starts getting stupid. I learned of a state program to assist small business owners improve the appearance of their facility. Cool. Although my patio area is beautifully landscaped it’s not conducive being a good area for commerce. In other words, it needs to be totally redone. Perfect situation for the state funds, right? Uh, not so much.
Here was the exchange between the State of Michigan and my city representative: SoM: “Is this the place?” City: “Yes”. SoM: “It’s already been improved.” City: “But it doesn’t work for the business he wants to put in”. SOM: “But it’s already been improved”. City: “It’s been landscaped, but it needs to be fenced in and be restructured for commercial use”. SoM: “But it’s already been improved”. And so on.
Needless to say, I’m getting no state money.
Then there’s my bank – my commercial bank. I won’t bore you with the exact dialog but the essence of the conversation comes down to that I have plenty of equity and great credit, but, uh, well, the best I can make out banks don’t make loans any more. Actually to be more accurate, the quote was “we’re making no loans to anyone at this time”. So, I’m not sure exactly what they do, but providing capital doesn’t appear to be one of them. I asked my handler from the bank what their Mission Statement is. When he fumbled for an answer I suggested they use the Hotel California missive. “You can check your money in but it can never leave”.
So essentially the only way you can get money these days is if you take your big company, manage it badly, break all the rules (and a bunch of laws) and then beg the government to bail you out; which they will do and as a bonus not put any oversight on what you do with the money.
Therefore I’m thinking too small. There’s no reward for being sensible, I need to greatly overreach my bounds and when it doesn’t work out I’ll just beg for one of those $250,000+ jobs being created by the stimulus package. I mean, if the package costs $787 billion…I’m sorry…BILLION…and it’s going to created 3 million jobs then each job is worth $262K. Not bad, I could make that work.
So, where’s the XOD advice in this post? Well, for one read the Pragmatic Marketing blog Tuned In where they talk about the 10 steps for winning in a down economy. The other, I guess, is don’t look for help from anyone closer than yourself these days. And you know, that’s probably as it should be anyway.
Thank you, doctor. I feel better.
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3 comments:
Unbelievable. Unsurprising, but yet still unbelievable.
Perhaps the following would have been a good reply to the bank in question, "OK, thanks. I'll take all my money. Now. In twenties."
Try doing the paperwork for one of those "no loans." Or. is there a queue, and you are just making a reservation for a loan?
It didn't get easier. :)
A lunch spot you may be familiar with, Al's Beef on Orleans - found itself over extended due to an expansion plan that well started early last year (who could have guessed). So they fall behind on the loan. They ask for a modification (not a bailout or write down) - and do not get it. For most that would be the beginning of the end - let the default process begin.
He decides to appeal - but not to the bank but to the Chairman of the Financial Services Subcommittee on Financial Institutions and Consumer Credit who happens to be from his state. So this week he is in front of congress telling them that his bank received $85Mil in TARP money and would not provide any relief.
Way to go!
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