Most people when faced with treading water realize that at some point to get somewhere they either have to start swimming or drown. You only have so much energy to stay where you are. The same thing holds true for businesses! You Can Only Tread Water For So Long! A business can maintain the status
Once you find yourself in a recession your first goal is to stabilize your operations. But having achieved that goal you need to look beyond the present and develop a longer term strategy. Our goal for this recession is to “come out of the recession better and stronger than we went in!” Recession Strategies for
I had lunch a couple of weeks ago with an investor the day after the President spoke to the nation. I commented on how every time the President spoke the next day the stock market dropped. My friend made the observation that there would not be any economic recovery until the following institutions participated: Banks
Yesterday I opened our local newspaper, the Houston Chronicle, and discovered that the “business section” had now been combined with the “City and State” section. To add insult to injury the City and State section had more pages than the Business section! Finally, most of the business section articles were from the AP newswire. You
Most CFO’s cut costs to obtain profitability for the company. In a recession, that is often the best course of action. The question is: what kind of knife do you use? A meat cleaver or a scalpel? Should You Cut Marketing Expense in a Recession? Marketing costs are a prime target for the CFO’s slashing
Obtaining bank loans in this economy is different than it has been in the past 5 years though not impossible. Understanding how to approach a banker in this economy is crucial to success. Recently banks required 3 years financial statements, 3 years tax returns and personal financial statements in order to loan a company money.
For the past two months,(even before the credit crunch hit!), bankers have been telling me that they are getting new marching instructions from their management. The banks are in the process of reducing their leverage. What this means to companies is that even good credit companies are going to find it difficult to move their
As the dust settles from the turmoil on Wall Street, I am trying to judge the fallout for our business and our client’s. The danger seems so far removed but I sense that the “mushroom cloud” of financial fallout is spreading! Liquidity is Drying Up on Main Street You would think that in Houston, Texas,
Sorry, I couldn’t resist the pun! Recently I have been visiting with several general contracting clients regarding the challenges they are facing. Both complained of the dramatic rise in construction costs in the face of a softening economy. Over the past 6 months construction costs have been increasing 1% – 2% per month for an
While some believe that the financial markets may have seen the worst of the subprime credit meltdown, the worst may be yet to come in the ‘real’ economy. There’s an article worth reading in today’s WSJ that touches on how the economy may trail markets in recovery. Economy May Trail Markets in Recovery Basically, the impact
Orders for durable goods fell for the second straight month in February according to the Commerce Department, as did orders for non-defense capital goods. (Bloomberg) Unfortunately, the capital spending indicator down is not good news for business. Capital Spending Indicator Down Orders for machinery fell by the largest amount since the Commerce Department began tracking
JPMorgan Chase announced today that it will acquire Bear Stearns for $2 a share today. On Friday, Bear Stearns’ stock price closed at $30.00 on Friday. This is already down close to half over its Thursday close. In addition, it is 81% down from its high for the last year of $159.36. The subprime mess
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