Magnet2Wealth Marketing Group
As lawmakers continue to debate and restructure a proposed $700 billion bailout plan for Wall Street, the two presidential candidates have made the economy and the job market the focus of their campaigns. Each candidate promises to enact policies that will help ignite a recovery and new job growth, but where that growth occurs will depend heavily on who wins in November.
A McCain win will like mean job gains in oil and gas, aerospace/defense, nuclear engineering, insurance, automotive and financial services. Meanwhile, an Obama win could help spur job growth in education, telecommunications, manufacturing, alternative energy industries and construction.
It's hard to say which future president will succeed in delivering an economic recovery and job growth, primarily because so many other factors will play a role in determining the outcome of their policy initiatives.
Through September, employers have announced 763,090 job cuts, nearly as many as the 768,264 job cuts announced in all of 2007, according to the latest layoff tracking by Challenger, Gray & Christmas.
Magnet2Wealth Marketing Group
Meanwhile, the latest government data show that the unemployment rate has climbed to 6.1 percent, up from 4.7 percent a year ago. The number of people in August who have been out of work for at least six weeks reached 1.8 million, compared to 1.25 million last year. Furthermore, the number of Americans working part time due to slack business conditions and the unavailability of full-time positions has increased by 27 percent over the last 12 months to 5.7 million.
JOB WINNERS UNDER PRESIDENT OBAMA
Magnet2Wealth Marketing Group
Manufacturing – Increasing labor costs in foreign markets and higher shipping costs are already starting to weaken the attractiveness of off-shore manufacturing. Senator Obama’s plan to provide tax breaks to companies that manufacture products in America could be enough incentive to move some overseas production back to the United States.
Education/Teachers – As thousands of teachers lose their jobs across the country due to lack of funding or decreased enrollment, Senator Obama plans to provide funding for teacher rewards such as higher pay and intervention strategies that include teaching teams, parent programs and personal academic plans to engage students in middle school. This initiative should create thousands of opportunities for teachers in early childhood education as well as academic counselors and mentors.
Alternative Energy – Senator Obama pledges to invest $150 billion over the next decade in renewable energy, including developing and perfecting biofuel technology, creating and commercializing plug-in hybrid and electric cars, investing in low-emission coal plants, transitioning to a digital electricity grid and advancing solar and wind initiatives. These projects will require thousands of engineers, environmental scientists and equipment manufacturers and operators in the automotive, transportation, chemical and technology industries.
Construction - Senator Obama has pledged $60 billion over the next ten years for projects to develop and maintain the national infrastructure. Construction workers will be needed to build or repair bridges and roads across the country, with job creation expected to reach as high as two million direct and indirect jobs per year.
Civil Engineering – The money provided for infrastructure projects will also go toward the planning and implementation of designs for cities and towns. Civil engineers will be needed on the local and national level to develop and oversee these plans.
Telecommunications – As the internet and cell phones become more and more important to Americans – from finding jobs to applying to college – Obama pledges to supply broadband networks to every community in the nation. With tax and loan incentives, thousands of telecommunications and technology workers will assist in reworking the nation’s wireless spectrum and creating new applications and next-generation facilities.
JOB WINNERS UNDER PRESIDENT McCAIN
Magnet2Wealth Marketing Group
Oil & Gas – Senator McCain’s energy policy includes exploring domestic oil and natural gas supplies in order to end dependence on foreign oil. This move will likely create thousands of jobs, including petroleum technicians to collect information on oil locations, equipment manufacturers, engineers and laborers.
Nuclear science/engineering – McCain’s plan to build 45 new nuclear power plants over the next two decades, providing an alternative source of cheap electricity is expected to produce 700,000 jobs. Seasoned workers will be needed to run plant operations, but entry-level workers can gain experience as laborers, with potential to replace their retiring counterparts after several years of training. The new plants will also need power distributors and dispatchers to monitor the flow of electricity.
Construction – A portion of the 700,000 jobs needed to build 45 new nuclear power plants will come from the actual construction. McCain also proposes legislation to manufacture environmentally-friendly buildings, both for residential and business use, creating thousands of opportunities for construction workers.
Insurance – Employer-sponsored health care costs have more than doubled over the last ten years, and the cost of insurance is on the forefront of most voters’ minds. Senator McCain proposes to reform the existing tax code to allow workers to choose their insurance providers outside of what their employers offer. This move will likely mean more competition in the insurance industry, creating hundreds of opportunities for sales people, claims adjusters, underwriters, examiners, investigators, management analysts, and administrators.
Automotive – Senator McCain wants to provide incentives for automobile makers to develop fuel-efficient and hybrid technologies. Thousands of dollars in tax credits for fuel efficient cars, as well as a proposed $300 million prize for plug-in hybrid and fully electric batteries will likely substantially increase job opportunities in automotive engineering and manufacturing.
Aerospace/Defense – Senator McCain strongly supports the development and deployment of missile defenses, increasing the size of the military and upgrading military technologies. To meet this goal, the government will have to order an increased amount of missile defense systems, weaponry and safety equipment, potentially creating thousands of manufacturing and engineering jobs, as well as dynamic recruitment efforts for the Armed Forces
Friday, October 31, 2008
Saturday, October 11, 2008
Why You are Not Rich
10 (More) Reasons You're Not Rich
by Jeffrey Strain
Wednesday, October 1, 2008provided byTheStreet.com
Many people assume they aren't rich because they don't earn enough money. If I only earned a little more, I could save and invest better, they say.
The problem with that theory is they were probably making exactly the same argument before their last several raises. Becoming a millionaire has less to do with how much you make, it's how you treat money in your daily life.
www.magnet2wealth.net/s
The list of reasons you may not be rich doesn't end at 10. Caring what your neighbors think, not being patient, having bad habits, not having goals, not being prepared, trying to make a quick buck, relying on others to handle your money, investing in things you don't understand, being financially afraid and ignoring your finances.
Here are 10 more possible reasons you aren't rich:
You care what your car looks like: A car is a means of transportation to get from one place to another, but many people don't view it that way. Instead, they consider it a reflection of themselves and spend money every two years or so to impress others instead of driving the car for its entire useful life and investing the money saved.
You feel entitlement: If you believe you deserve to live a certain lifestyle, have certain things and spend a certain amount before you have earned to live that way, you will have to borrow money. That large chunk of debt will keep you from building wealth.
You lack diversification: There is a reason one of the oldest pieces of financial advice is to not keep all your eggs in a single basket. Having a diversified investment portfolio makes it much less likely that wealth will suddenly disappear.
You started too late: The magic of compound interest works best over long periods of time. If you find you're always saying there will be time to save and invest in a couple more years, you'll wake up one day to find retirement is just around the corner and there is still nothing in your retirement account.
You don't do what you enjoy: While your job doesn't necessarily need to be your dream job, you need to enjoy it. If you choose a job you don't like just for the money, you'll likely spend all that extra cash trying to relieve the stress of doing work you hate.
You don't like to learn: You may have assumed that once you graduated from college, there was no need to study or learn. That attitude might be enough to get you your first job or keep you employed, but it will never make you rich. A willingness to learn to improve your career and finances are essential if you want to eventually become wealthy.
You buy things you don't use: Take a look around your house, in the closets, basement, attic and garage and see if there are a lot of things you haven't used in the past year. If there are, chances are that all those things you purchased were wasted money that could have been used to increase your net worth.
You don't understand value: You buy things for any number of reasons besides the value that the purchase brings to you. This is not limited to those who feel the need to buy the most expensive items, but can also apply to those who always purchase the cheapest goods. Rarely are either the best value, and it's only when you learn to purchase good value that you have money left over to invest for your future.
www.magnet2wealth.net/s
Your house is too big: When you buy a house that is bigger than you can afford or need, you end up spending extra money on longer debt payments, increased taxes, higher upkeep and more things to fill it. Some people will try to argue that the increased value of the house makes it a good investment, but the truth is that unless you are willing to downgrade your living standards, which most people are not, it will never be a liquid asset or money that you can ever use and enjoy.
You fail to take advantage of opportunities: There has probably been more than one occasion where you heard about someone who has made it big and thought to yourself, "I could have thought of that." There are plenty of opportunities if you have the will and determination to keep your eyes open.
www.magnet2wealth.net/s
by Jeffrey Strain
Wednesday, October 1, 2008provided byTheStreet.com
Many people assume they aren't rich because they don't earn enough money. If I only earned a little more, I could save and invest better, they say.
The problem with that theory is they were probably making exactly the same argument before their last several raises. Becoming a millionaire has less to do with how much you make, it's how you treat money in your daily life.
www.magnet2wealth.net/s
The list of reasons you may not be rich doesn't end at 10. Caring what your neighbors think, not being patient, having bad habits, not having goals, not being prepared, trying to make a quick buck, relying on others to handle your money, investing in things you don't understand, being financially afraid and ignoring your finances.
Here are 10 more possible reasons you aren't rich:
You care what your car looks like: A car is a means of transportation to get from one place to another, but many people don't view it that way. Instead, they consider it a reflection of themselves and spend money every two years or so to impress others instead of driving the car for its entire useful life and investing the money saved.
You feel entitlement: If you believe you deserve to live a certain lifestyle, have certain things and spend a certain amount before you have earned to live that way, you will have to borrow money. That large chunk of debt will keep you from building wealth.
You lack diversification: There is a reason one of the oldest pieces of financial advice is to not keep all your eggs in a single basket. Having a diversified investment portfolio makes it much less likely that wealth will suddenly disappear.
You started too late: The magic of compound interest works best over long periods of time. If you find you're always saying there will be time to save and invest in a couple more years, you'll wake up one day to find retirement is just around the corner and there is still nothing in your retirement account.
You don't do what you enjoy: While your job doesn't necessarily need to be your dream job, you need to enjoy it. If you choose a job you don't like just for the money, you'll likely spend all that extra cash trying to relieve the stress of doing work you hate.
You don't like to learn: You may have assumed that once you graduated from college, there was no need to study or learn. That attitude might be enough to get you your first job or keep you employed, but it will never make you rich. A willingness to learn to improve your career and finances are essential if you want to eventually become wealthy.
You buy things you don't use: Take a look around your house, in the closets, basement, attic and garage and see if there are a lot of things you haven't used in the past year. If there are, chances are that all those things you purchased were wasted money that could have been used to increase your net worth.
You don't understand value: You buy things for any number of reasons besides the value that the purchase brings to you. This is not limited to those who feel the need to buy the most expensive items, but can also apply to those who always purchase the cheapest goods. Rarely are either the best value, and it's only when you learn to purchase good value that you have money left over to invest for your future.
www.magnet2wealth.net/s
Your house is too big: When you buy a house that is bigger than you can afford or need, you end up spending extra money on longer debt payments, increased taxes, higher upkeep and more things to fill it. Some people will try to argue that the increased value of the house makes it a good investment, but the truth is that unless you are willing to downgrade your living standards, which most people are not, it will never be a liquid asset or money that you can ever use and enjoy.
You fail to take advantage of opportunities: There has probably been more than one occasion where you heard about someone who has made it big and thought to yourself, "I could have thought of that." There are plenty of opportunities if you have the will and determination to keep your eyes open.
www.magnet2wealth.net/s
$3 Trillion Dollar War
The Iraq War Will Cost Us $3 Trillion, and Much More
By Linda J. Bilmes and Joseph E. Stiglitz
Sunday, March 9, 2008; B01
There is no such thing as a free lunch, and there is no such thing as a free war. The Iraq adventure has seriously weakened the U.S. economy, whose woes now go far beyond loose mortgage lending. You can't spend $3 trillion -- yes, $3 trillion -- on a failed war abroad and not feel the pain at home.
Some people will scoff at that number, but we've done the math. Senior Bush administration aides certainly pooh-poohed worrisome estimates in the run-up to the war. Former White House economic adviser Lawrence Lindsey reckoned that the conflict would cost $100 billion to $200 billion; Defense Secretary Donald H. Rumsfeld later called his estimate "baloney." Administration officials insisted that the costs would be more like $50 billion to $60 billion. In April 2003, Andrew S. Natsios, the thoughtful head of the U.S. Agency for International Development, said on "Nightline" that reconstructing Iraq would cost the American taxpayer just $1.7 billion. Ted Koppel, in disbelief, pressed Natsios on the question, but Natsios stuck to his guns. Others in the administration, such as Deputy Defense Secretary Paul D. Wolfowitz, hoped that U.S. partners would chip in, as they had in the 1991 Persian Gulf War, or that Iraq's oil would pay for the damages.
The end result of all this wishful thinking? As we approach the fifth anniversary of the invasion, Iraq is not only the second longest war in U.S. history (after Vietnam), it is also the second most costly -- surpassed only by World War II.
Why doesn't the public understand the staggering scale of our expenditures? In part because the administration talks only about the upfront costs, which are mostly handled by emergency appropriations. (Iraq funding is apparently still an emergency five years after the war began.) These costs, by our calculations, are now running at $12 billion a month -- $16 billion if you include Afghanistan. By the time you add in the costs hidden in the defense budget, the money we'll have to spend to help future veterans, and money to refurbish a military whose equipment and materiel have been greatly depleted, the total tab to the federal government will almost surely exceed $1.5 trillion.
But the costs to our society and economy are far greater. When a young soldier is killed in Iraq or Afghanistan, his or her family will receive a U.S. government check for just $500,000 (combining life insurance with a "death gratuity") -- far less than the typical amount paid by insurance companies for the death of a young person in a car accident. The stark "budgetary cost" of $500,000 is clearly only a fraction of the total cost society pays for the loss of life -- and no one can ever really compensate the families. Moreover, disability pay seldom provides adequate compensation for wounded troops or their families. Indeed, in one out of five cases of seriously injured soldiers, someone in their family has to give up a job to take care of them.
But beyond this is the cost to the already sputtering U.S. economy. All told, the bill for the Iraq war is likely to top $3 trillion. And that's a conservative estimate.
President Bush tried to sell the American people on the idea that we could have a war with little or no economic sacrifice. Even after the United States went to war, Bush and Congress cut taxes, especially on the rich -- even though the United States already had a massive deficit. So the war had to be funded by more borrowing. By the end of the Bush administration, the cost of the wars in Iraq and Afghanistan, plus the cumulative interest on the increased borrowing used to fund them, will have added about $1 trillion to the national debt.
The long-term burden of paying for the conflicts will curtail the country's ability to tackle other urgent problems, no matter who wins the presidency in November. Our vast and growing indebtedness inevitably makes it harder to afford new health-care plans, make large-scale repairs to crumbling roads and bridges, or build better-equipped schools. Already, the escalating cost of the wars has crowded out spending on virtually all other discretionary federal programs, including the National Institutes of Health, the Food and Drug Administration, the Environmental Protection Agency, and federal aid to states and cities, all of which have been scaled back significantly since the invasion of Iraq.
To make matters worse, the U.S. economy is facing a recession. But our ability to implement a truly effective economic-stimulus package is crimped by expenditures of close to $200 billion on the two wars this year alone and by a skyrocketing national debt.
The United States is a rich and strong country, but even rich and strong countries squander trillions of dollars at their peril. Think what a difference $3 trillion could make for so many of the United States' -- or the world's -- problems. We could have had a Marshall Plan to help desperately poor countries, winning the hearts and maybe the minds of Muslim nations now gripped by anti-Americanism. In a world with millions of illiterate children, we could have achieved literacy for all -- for less than the price of a month's combat in Iraq. We worry about China's growing influence in Africa, but the upfront cost of a month of fighting in Iraq would pay for more than doubling our annual current aid spending on Africa.
Closer to home, we could have funded countless schools to give children locked in the underclass a shot at decent lives. Or we could have tackled the massive problem of Social Security, which Bush began his second term hoping to address; for far, far less than the cost of the war, we could have ensured the solvency of Social Security for the next half a century or more.
Economists used to think that wars were good for the economy, a notion born out of memories of how the massive spending of World War II helped bring the United States and the world out of the Great Depression. But we now know far better ways to stimulate an economy -- ways that quickly improve citizens' well-being and lay the foundations for future growth. But money spent paying Nepalese workers in Iraq (or even Iraqi ones) doesn't stimulate the U.S. economy the way that money spent at home would -- and it certainly doesn't provide the basis for long-term growth the way investments in research, education or infrastructure would.
Another worry: This war has been particularly hard on the economy because it led to a spike in oil prices. Before the 2003 invasion, oil cost less than $25 a barrel, and futures markets expected it to remain around there. (Yes, China and India were growing by leaps and bounds, but cheap supplies from the Middle East were expected to meet their demands.) The war changed that equation, and oil prices recently topped $100 per barrel.
While Washington has been spending well beyond its means, others have been saving -- including the oil-rich countries that, like the oil companies, have been among the few winners of this war. No wonder, then, that China, Singapore and many Persian Gulf emirates have become lenders of last resort for troubled Wall Street banks, plowing in billions of dollars to shore up Citigroup, Merrill Lynch and other firms that burned their fingers on subprime mortgages. How long will it be before the huge sovereign wealth funds controlled by these countries begin buying up large shares of other U.S. assets?
The Bush team, then, is not merely handing over the war to the next administration; it is also bequeathing deep economic problems that have been seriously exacerbated by reckless war financing. We face an economic downturn that's likely to be the worst in more than a quarter-century.
Until recently, many marveled at the way the United States could spend hundreds of billions of dollars on oil and blow through hundreds of billions more in Iraq with what seemed to be strikingly little short-run impact on the economy. But there's no great mystery here. The economy's weaknesses were concealed by the Federal Reserve, which pumped in liquidity, and by regulators that looked away as loans were handed out well beyond borrowers' ability to repay them. Meanwhile, banks and credit-rating agencies pretended that financial alchemy could convert bad mortgages into AAA assets, and the Fed looked the other way as the U.S. household-savings rate plummeted to zero.
It's a bleak picture. The total loss from this economic downturn -- measured by the disparity between the economy's actual output and its potential output -- is likely to be the greatest since the Great Depression. That total, itself well in excess of $1 trillion, is not included in our estimated $3 trillion cost of the war.
Others will have to work out the geopolitics, but the economics here are clear. Ending the war, or at least moving rapidly to wind it down, would yield major economic dividends.
As we head toward November, opinion polls say that voters' main worry is now the economy, not the war. But there's no way to disentangle the two. The United States will be paying the price of Iraq for decades to come. The price tag will be all the greater because we tried to ignore the laws of economics -- and the cost will grow the longer we remain.
linda_bilmes@harvard.edu
jes322@columbia.edu
Linda J. Bilmes, a former chief financial officer at the Commerce Department, teaches at Harvard University's Kennedy School of Government. Joseph E. Stiglitz, a professor at Columbia University, served as chairman of the Council of Economic Advisers under President Bill Clinton. They are co-authors of "The Three Trillion Dollar War: The True Cost of the Iraq Conflict."
www.wealthysecretsociety.com
By Linda J. Bilmes and Joseph E. Stiglitz
Sunday, March 9, 2008; B01
There is no such thing as a free lunch, and there is no such thing as a free war. The Iraq adventure has seriously weakened the U.S. economy, whose woes now go far beyond loose mortgage lending. You can't spend $3 trillion -- yes, $3 trillion -- on a failed war abroad and not feel the pain at home.
Some people will scoff at that number, but we've done the math. Senior Bush administration aides certainly pooh-poohed worrisome estimates in the run-up to the war. Former White House economic adviser Lawrence Lindsey reckoned that the conflict would cost $100 billion to $200 billion; Defense Secretary Donald H. Rumsfeld later called his estimate "baloney." Administration officials insisted that the costs would be more like $50 billion to $60 billion. In April 2003, Andrew S. Natsios, the thoughtful head of the U.S. Agency for International Development, said on "Nightline" that reconstructing Iraq would cost the American taxpayer just $1.7 billion. Ted Koppel, in disbelief, pressed Natsios on the question, but Natsios stuck to his guns. Others in the administration, such as Deputy Defense Secretary Paul D. Wolfowitz, hoped that U.S. partners would chip in, as they had in the 1991 Persian Gulf War, or that Iraq's oil would pay for the damages.
The end result of all this wishful thinking? As we approach the fifth anniversary of the invasion, Iraq is not only the second longest war in U.S. history (after Vietnam), it is also the second most costly -- surpassed only by World War II.
Why doesn't the public understand the staggering scale of our expenditures? In part because the administration talks only about the upfront costs, which are mostly handled by emergency appropriations. (Iraq funding is apparently still an emergency five years after the war began.) These costs, by our calculations, are now running at $12 billion a month -- $16 billion if you include Afghanistan. By the time you add in the costs hidden in the defense budget, the money we'll have to spend to help future veterans, and money to refurbish a military whose equipment and materiel have been greatly depleted, the total tab to the federal government will almost surely exceed $1.5 trillion.
But the costs to our society and economy are far greater. When a young soldier is killed in Iraq or Afghanistan, his or her family will receive a U.S. government check for just $500,000 (combining life insurance with a "death gratuity") -- far less than the typical amount paid by insurance companies for the death of a young person in a car accident. The stark "budgetary cost" of $500,000 is clearly only a fraction of the total cost society pays for the loss of life -- and no one can ever really compensate the families. Moreover, disability pay seldom provides adequate compensation for wounded troops or their families. Indeed, in one out of five cases of seriously injured soldiers, someone in their family has to give up a job to take care of them.
But beyond this is the cost to the already sputtering U.S. economy. All told, the bill for the Iraq war is likely to top $3 trillion. And that's a conservative estimate.
President Bush tried to sell the American people on the idea that we could have a war with little or no economic sacrifice. Even after the United States went to war, Bush and Congress cut taxes, especially on the rich -- even though the United States already had a massive deficit. So the war had to be funded by more borrowing. By the end of the Bush administration, the cost of the wars in Iraq and Afghanistan, plus the cumulative interest on the increased borrowing used to fund them, will have added about $1 trillion to the national debt.
The long-term burden of paying for the conflicts will curtail the country's ability to tackle other urgent problems, no matter who wins the presidency in November. Our vast and growing indebtedness inevitably makes it harder to afford new health-care plans, make large-scale repairs to crumbling roads and bridges, or build better-equipped schools. Already, the escalating cost of the wars has crowded out spending on virtually all other discretionary federal programs, including the National Institutes of Health, the Food and Drug Administration, the Environmental Protection Agency, and federal aid to states and cities, all of which have been scaled back significantly since the invasion of Iraq.
To make matters worse, the U.S. economy is facing a recession. But our ability to implement a truly effective economic-stimulus package is crimped by expenditures of close to $200 billion on the two wars this year alone and by a skyrocketing national debt.
The United States is a rich and strong country, but even rich and strong countries squander trillions of dollars at their peril. Think what a difference $3 trillion could make for so many of the United States' -- or the world's -- problems. We could have had a Marshall Plan to help desperately poor countries, winning the hearts and maybe the minds of Muslim nations now gripped by anti-Americanism. In a world with millions of illiterate children, we could have achieved literacy for all -- for less than the price of a month's combat in Iraq. We worry about China's growing influence in Africa, but the upfront cost of a month of fighting in Iraq would pay for more than doubling our annual current aid spending on Africa.
Closer to home, we could have funded countless schools to give children locked in the underclass a shot at decent lives. Or we could have tackled the massive problem of Social Security, which Bush began his second term hoping to address; for far, far less than the cost of the war, we could have ensured the solvency of Social Security for the next half a century or more.
Economists used to think that wars were good for the economy, a notion born out of memories of how the massive spending of World War II helped bring the United States and the world out of the Great Depression. But we now know far better ways to stimulate an economy -- ways that quickly improve citizens' well-being and lay the foundations for future growth. But money spent paying Nepalese workers in Iraq (or even Iraqi ones) doesn't stimulate the U.S. economy the way that money spent at home would -- and it certainly doesn't provide the basis for long-term growth the way investments in research, education or infrastructure would.
Another worry: This war has been particularly hard on the economy because it led to a spike in oil prices. Before the 2003 invasion, oil cost less than $25 a barrel, and futures markets expected it to remain around there. (Yes, China and India were growing by leaps and bounds, but cheap supplies from the Middle East were expected to meet their demands.) The war changed that equation, and oil prices recently topped $100 per barrel.
While Washington has been spending well beyond its means, others have been saving -- including the oil-rich countries that, like the oil companies, have been among the few winners of this war. No wonder, then, that China, Singapore and many Persian Gulf emirates have become lenders of last resort for troubled Wall Street banks, plowing in billions of dollars to shore up Citigroup, Merrill Lynch and other firms that burned their fingers on subprime mortgages. How long will it be before the huge sovereign wealth funds controlled by these countries begin buying up large shares of other U.S. assets?
The Bush team, then, is not merely handing over the war to the next administration; it is also bequeathing deep economic problems that have been seriously exacerbated by reckless war financing. We face an economic downturn that's likely to be the worst in more than a quarter-century.
Until recently, many marveled at the way the United States could spend hundreds of billions of dollars on oil and blow through hundreds of billions more in Iraq with what seemed to be strikingly little short-run impact on the economy. But there's no great mystery here. The economy's weaknesses were concealed by the Federal Reserve, which pumped in liquidity, and by regulators that looked away as loans were handed out well beyond borrowers' ability to repay them. Meanwhile, banks and credit-rating agencies pretended that financial alchemy could convert bad mortgages into AAA assets, and the Fed looked the other way as the U.S. household-savings rate plummeted to zero.
It's a bleak picture. The total loss from this economic downturn -- measured by the disparity between the economy's actual output and its potential output -- is likely to be the greatest since the Great Depression. That total, itself well in excess of $1 trillion, is not included in our estimated $3 trillion cost of the war.
Others will have to work out the geopolitics, but the economics here are clear. Ending the war, or at least moving rapidly to wind it down, would yield major economic dividends.
As we head toward November, opinion polls say that voters' main worry is now the economy, not the war. But there's no way to disentangle the two. The United States will be paying the price of Iraq for decades to come. The price tag will be all the greater because we tried to ignore the laws of economics -- and the cost will grow the longer we remain.
linda_bilmes@harvard.edu
jes322@columbia.edu
Linda J. Bilmes, a former chief financial officer at the Commerce Department, teaches at Harvard University's Kennedy School of Government. Joseph E. Stiglitz, a professor at Columbia University, served as chairman of the Council of Economic Advisers under President Bill Clinton. They are co-authors of "The Three Trillion Dollar War: The True Cost of the Iraq Conflict."
www.wealthysecretsociety.com
Thursday, October 9, 2008
How to Sell More during a Meltdown
Let’s face it. Things are bad out there. Businesses aren’t buying. They’re either scared or can’t get credit.
When times are good, anybody can sell. It’s at times like this that you find out if you’re really a sales professional… or just an order taker.
Here’s the good news. Chances are your competitor — the sales guy down the street — is obsessing about the economy when he should be out selling.
So that means that you’ve just been handed an incredible opportunity to capture what business is still out there.
Here’s EXACTLY how to turn the financial crisis into a sales opportunity:
* STEP #1: Calm Yourself First. Above all, keep your own negative emotions in check. You may be worried about the economy, your job, and everything else, but you can’t let those worries rule your thoughts and actions. Rather than focusing on the “big picture” of a collapsing economy (if that indeed is what’s happening), think about your current situation as if you’re starting a new sales job that presents some interesting challenges to overcome. Remember: even during the worst of times, some people (especially sales pros) end up winning. Let’s make sure it’s you.
* STEP #2: Assess Your Firm’s Viability. Take a good, hard, realistic look at your firm. How vulnerable is it? Is it about to go under? Is it at risk? How much risk? Stand back and look at your firm as if you were a customer. Would you want to do business with it? If the answer is no, then your first order of business is to find a job in a company that’s not going to go under. However, if your firm is basically sound and not at much risk of failure, there’s no reason for you not to go out there and sell like there’s no tomorrow.
* STEP #3: Craft a Corporate Message. The customer is going to be worried about lots of things. You don’t want the viability of your firm to be one of them. Figure out how you’re going to communicate the stability of your firm in a way that the customer will understand and believe you. Your personal guarantee won’t be enough. You should show the customer enough detail of your corporate financials so that they know, beyond all doubt, that your firm isn’t going to be a victim and that buying from you is a safe bet.
* STEP #4: Tune Your Solution Message. Here’s some good news. Your customer is afraid, so you don’t have to create an impetus to buy. All you need do is position your solution so that buying it lessens the customer’s fear. This is not the time for messages of of high risk that emphasize inspiration, empowerment and innovation. It’s the time for messages of low risk like protection, security and stability. Show how your product will protect your customer contact’s job and you’re 90 percent on the way to a done deal.
* STEP #5: Research Your Pricing Options. If there was ever a time to figure out different ways to finance a deal, this is it. Work with your CFO or other financial gurus on alternative financing plans, delayed payments, subscription fees, discounts, whatever… Because the customer might be having cash-flow problems, you want to be able to walk into EVERY sales situation with a bag of tricks that will allow them to make the smart decision and buy from you.
* STEP #6: Re-prioritize Your Opportunities. The financial crisis is changing the business landscape very quickly. As a result, a company that three weeks ago looked like a hot prospect might be a dead loser today. Therefore, you must run though your entire list of leads and opportunities and, based upon what you know and can learn with some research, prioritize your opportunities, based upon likelihood to buy and ability to pay quickly. Put your long-term “strategic” opportunities on hold.
* STEP #7: Re-qualify Your Customers. Each time you get in contact with a customer or prospect, use your questioning skills to determine whether or not they’re going to be a victim of the meltdown before they pay you. Once you’re relatively certain they’re a reasonable risk, use the flexibility of your financial options to determine the payment plan or method that will both make it easy for them to say “YES!” and maximize the likelihood that your firm will get paid.
* STEP #8: Work the Numbers. Set up an ambitious schedule of working through the steps of your sales process. And then follow it. One of the best things about a sales process is that it forces you to focus on the mechanics of selling rather than your emotions about the crisis. The regularity of making your 20 cold calls, or 10 referral calls, every day, like clockwork, is a great way to get a sense of accomplishment, even if your hit rate is (understandably) lower than usual.
* STEP #9: Decide to Enjoy Yourself. Everyone knows you should party when you pull off the big wins. But when things are difficult, you need to give yourself credit and lots of it, simply for plugging away. Your challenge is to keep enjoying yourself and your job, even though times are tough. Decide to feel good and then do it. If you’ve got the emotional moxie to stay calm when everyone else is talking Chicken Little at the water cooler, this could be one of most successful sales seasons of your entire career.
* STEP #10: Become a Leader. It’s going to be a bit harder to make the deals than it was a few months ago. So what? If you’re doing everything in the above steps, you’ll be outselling the competition, because your competitors will be busy fussing about the economy and wringing their hands. There’s a saying that true leadership consists of being able to remain calm during a disaster. This is that disaster; and this is the time for YOU to remain calm and make the best of the situation.
www.magnet2wealth.net/s
When times are good, anybody can sell. It’s at times like this that you find out if you’re really a sales professional… or just an order taker.
Here’s the good news. Chances are your competitor — the sales guy down the street — is obsessing about the economy when he should be out selling.
So that means that you’ve just been handed an incredible opportunity to capture what business is still out there.
Here’s EXACTLY how to turn the financial crisis into a sales opportunity:
* STEP #1: Calm Yourself First. Above all, keep your own negative emotions in check. You may be worried about the economy, your job, and everything else, but you can’t let those worries rule your thoughts and actions. Rather than focusing on the “big picture” of a collapsing economy (if that indeed is what’s happening), think about your current situation as if you’re starting a new sales job that presents some interesting challenges to overcome. Remember: even during the worst of times, some people (especially sales pros) end up winning. Let’s make sure it’s you.
* STEP #2: Assess Your Firm’s Viability. Take a good, hard, realistic look at your firm. How vulnerable is it? Is it about to go under? Is it at risk? How much risk? Stand back and look at your firm as if you were a customer. Would you want to do business with it? If the answer is no, then your first order of business is to find a job in a company that’s not going to go under. However, if your firm is basically sound and not at much risk of failure, there’s no reason for you not to go out there and sell like there’s no tomorrow.
* STEP #3: Craft a Corporate Message. The customer is going to be worried about lots of things. You don’t want the viability of your firm to be one of them. Figure out how you’re going to communicate the stability of your firm in a way that the customer will understand and believe you. Your personal guarantee won’t be enough. You should show the customer enough detail of your corporate financials so that they know, beyond all doubt, that your firm isn’t going to be a victim and that buying from you is a safe bet.
* STEP #4: Tune Your Solution Message. Here’s some good news. Your customer is afraid, so you don’t have to create an impetus to buy. All you need do is position your solution so that buying it lessens the customer’s fear. This is not the time for messages of of high risk that emphasize inspiration, empowerment and innovation. It’s the time for messages of low risk like protection, security and stability. Show how your product will protect your customer contact’s job and you’re 90 percent on the way to a done deal.
* STEP #5: Research Your Pricing Options. If there was ever a time to figure out different ways to finance a deal, this is it. Work with your CFO or other financial gurus on alternative financing plans, delayed payments, subscription fees, discounts, whatever… Because the customer might be having cash-flow problems, you want to be able to walk into EVERY sales situation with a bag of tricks that will allow them to make the smart decision and buy from you.
* STEP #6: Re-prioritize Your Opportunities. The financial crisis is changing the business landscape very quickly. As a result, a company that three weeks ago looked like a hot prospect might be a dead loser today. Therefore, you must run though your entire list of leads and opportunities and, based upon what you know and can learn with some research, prioritize your opportunities, based upon likelihood to buy and ability to pay quickly. Put your long-term “strategic” opportunities on hold.
* STEP #7: Re-qualify Your Customers. Each time you get in contact with a customer or prospect, use your questioning skills to determine whether or not they’re going to be a victim of the meltdown before they pay you. Once you’re relatively certain they’re a reasonable risk, use the flexibility of your financial options to determine the payment plan or method that will both make it easy for them to say “YES!” and maximize the likelihood that your firm will get paid.
* STEP #8: Work the Numbers. Set up an ambitious schedule of working through the steps of your sales process. And then follow it. One of the best things about a sales process is that it forces you to focus on the mechanics of selling rather than your emotions about the crisis. The regularity of making your 20 cold calls, or 10 referral calls, every day, like clockwork, is a great way to get a sense of accomplishment, even if your hit rate is (understandably) lower than usual.
* STEP #9: Decide to Enjoy Yourself. Everyone knows you should party when you pull off the big wins. But when things are difficult, you need to give yourself credit and lots of it, simply for plugging away. Your challenge is to keep enjoying yourself and your job, even though times are tough. Decide to feel good and then do it. If you’ve got the emotional moxie to stay calm when everyone else is talking Chicken Little at the water cooler, this could be one of most successful sales seasons of your entire career.
* STEP #10: Become a Leader. It’s going to be a bit harder to make the deals than it was a few months ago. So what? If you’re doing everything in the above steps, you’ll be outselling the competition, because your competitors will be busy fussing about the economy and wringing their hands. There’s a saying that true leadership consists of being able to remain calm during a disaster. This is that disaster; and this is the time for YOU to remain calm and make the best of the situation.
www.magnet2wealth.net/s
More Jobs Lost - but I have a solution
NEW YORK (CNNMoney.com) -- The number of out-of-work Americans filing new claims for unemployment insurance last week edged off a seven-year high but was higher than economists' estimates, according to a government report released Thursday.
The U.S. Department of Labor reported that initial filings for state jobless benefits decreased by 20,000 to a seasonally adjusted 478,000 in the week ended Oct. 4.
Economists surveyed by Briefing.com expected the number to decline to 475,000. For the week ended Sept. 27, unemployment claims spiked to an upwardly revised 498,000. That week, jobless claims were the highest recorded since the 517,000 claims filed in the wake of the Sept. 11 terrorist attacks.
The hurricane effect
The Labor Department attributed about 17,000 of the new claims to the lingering effects of Hurricanes Gustav and Ike. That helped increase the seasonally adjusted four-week moving average by 8,250 to 482,500 from 474,250 the week prior. That compares with 317,000 in the year-earlier period.
The four-week moving average tends to smooth fluctuations in the data. A level at or above 400,000 for the four-week average was present throughout the last two recessions.
Bob Brusca, an economist at FAO Economists said that if jobless claims related to the hurricanes were not factored in, claims figures would have moved higher.
"The underlying economy is getting worse," he said, adding that economic indicators will likely become "uncomfortably worse."
"You don't have to be an economist to know that the labor market is getting worse, the economy is getting worse, and jobless claims are going to rise," Brusca said.
He noted the jump in unemployment filings in Texas was not just hurricane related but due in part to losses in the finance, real estate and insurance market. "People are getting fired, and things are getting worse there."
The number of Americans workers collecting benefits for more than one week has jumped by 56,000 to 3,659,000 - the highest level in more than five years. The 4-week moving average jumped 31,750 to 3,563,250 from the preceding week.
Shedding jobs in unsteady economy
Last week, the Labor Department reported that the U.S. economy lost 159,000 jobs in September, the ninth straight month of losses in a year that has seen 760,000 jobs disappear so far. In September, the unemployment rate remained unchanged from the month prior at 6.1%.
This week, eBay Inc. (EBAY, Fortune 500) announced that it is cutting 1,600 jobs, about 10% of its work force.
The nation is battling a financial crisis that has resulted in bank failures, a lending freeze to businesses and steep drops in the stock market. On Thursday, the Bush administration is considering taking ownership stakes in certain U.S. banks to further combat the crisis, according to media reports. Last Friday, Congress approved the $700 billion bank bailout, allowing the Treasury to buy bad debt directly from banks.
here is your solution...>>> www.magnet2wealth.net/s
The U.S. Department of Labor reported that initial filings for state jobless benefits decreased by 20,000 to a seasonally adjusted 478,000 in the week ended Oct. 4.
Economists surveyed by Briefing.com expected the number to decline to 475,000. For the week ended Sept. 27, unemployment claims spiked to an upwardly revised 498,000. That week, jobless claims were the highest recorded since the 517,000 claims filed in the wake of the Sept. 11 terrorist attacks.
The hurricane effect
The Labor Department attributed about 17,000 of the new claims to the lingering effects of Hurricanes Gustav and Ike. That helped increase the seasonally adjusted four-week moving average by 8,250 to 482,500 from 474,250 the week prior. That compares with 317,000 in the year-earlier period.
The four-week moving average tends to smooth fluctuations in the data. A level at or above 400,000 for the four-week average was present throughout the last two recessions.
Bob Brusca, an economist at FAO Economists said that if jobless claims related to the hurricanes were not factored in, claims figures would have moved higher.
"The underlying economy is getting worse," he said, adding that economic indicators will likely become "uncomfortably worse."
"You don't have to be an economist to know that the labor market is getting worse, the economy is getting worse, and jobless claims are going to rise," Brusca said.
He noted the jump in unemployment filings in Texas was not just hurricane related but due in part to losses in the finance, real estate and insurance market. "People are getting fired, and things are getting worse there."
The number of Americans workers collecting benefits for more than one week has jumped by 56,000 to 3,659,000 - the highest level in more than five years. The 4-week moving average jumped 31,750 to 3,563,250 from the preceding week.
Shedding jobs in unsteady economy
Last week, the Labor Department reported that the U.S. economy lost 159,000 jobs in September, the ninth straight month of losses in a year that has seen 760,000 jobs disappear so far. In September, the unemployment rate remained unchanged from the month prior at 6.1%.
This week, eBay Inc. (EBAY, Fortune 500) announced that it is cutting 1,600 jobs, about 10% of its work force.
The nation is battling a financial crisis that has resulted in bank failures, a lending freeze to businesses and steep drops in the stock market. On Thursday, the Bush administration is considering taking ownership stakes in certain U.S. banks to further combat the crisis, according to media reports. Last Friday, Congress approved the $700 billion bank bailout, allowing the Treasury to buy bad debt directly from banks.
here is your solution...>>> www.magnet2wealth.net/s
Wednesday, October 8, 2008
Crisis Breeds Opportunity
I have read at least 20 separate articles this week all with
a similar theme: in times of economic downturns you can
always find a silver lining.
If you work for a living, you may wonder if your job will be
there in the morning. If you count on your Stock Portfolio
or your 401K to pave the way to retirement, well you probably
already know that you won't be retiring.
During the Great Depression of the 1930s a large portion of
the world's population suffered as inflation ran wild and
unemployment reached epidemic proportions.
But, there was a group of people and companies that actually
flourished during the depression, thanks to smart and innovative
thinking.
You may be wondering how you can protect your family and
THRIVE during this time.
Well, the first thing you need to do is stop thinking of
this time as a crisis, and start seeing this as your chance
to succeed beyond your wildest dreams!
During such times many people are going to be looking for
another way to earn the income they need to prosper. Many
people are going to be looking to start their own business
- a great many will be looking to start a business online.
As a matter of fact, a network marketing newsletter I
subscribe to pointed to a 50% increase in signups this past
month due to the bad economy.
This is the perfect time to get off your butt and do
something to secure and protect your future and that of
your family.
If you see an opportunity, you need to jump on it
immediately because you can be certain there are others out
there who won't waste a second to cash in on your future.
www.magnet2wealth.net/s
a similar theme: in times of economic downturns you can
always find a silver lining.
If you work for a living, you may wonder if your job will be
there in the morning. If you count on your Stock Portfolio
or your 401K to pave the way to retirement, well you probably
already know that you won't be retiring.
During the Great Depression of the 1930s a large portion of
the world's population suffered as inflation ran wild and
unemployment reached epidemic proportions.
But, there was a group of people and companies that actually
flourished during the depression, thanks to smart and innovative
thinking.
You may be wondering how you can protect your family and
THRIVE during this time.
Well, the first thing you need to do is stop thinking of
this time as a crisis, and start seeing this as your chance
to succeed beyond your wildest dreams!
During such times many people are going to be looking for
another way to earn the income they need to prosper. Many
people are going to be looking to start their own business
- a great many will be looking to start a business online.
As a matter of fact, a network marketing newsletter I
subscribe to pointed to a 50% increase in signups this past
month due to the bad economy.
This is the perfect time to get off your butt and do
something to secure and protect your future and that of
your family.
If you see an opportunity, you need to jump on it
immediately because you can be certain there are others out
there who won't waste a second to cash in on your future.
www.magnet2wealth.net/s
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