Prozac for angels

With the three major Western currency blocs acting in different ways to the current fiscal, growth and inflationary problems it will be educational to look back and analyse which was correct. One Bank has been slashing rates, one holding steady and the third looking to tighten spending.

With Federal Reserve rates around 2%, about half the inflation rate, we can see that the Fed is more concerned with growth than with fighting inflation. For holders of cash and short term bonds the decay in the absolute value of your assets is running (after tax on income) at around 2.5% a year. This slow but constant devaluation of overall net worth is now affecting just about every single asset class in America. With the ongoing USD weakness it is not unreasonable to assume the average American citizen is significantly poorer this year than last.

To be fair, the US is, by and large, pretty insular economically, socially and politically. In such an economy the affects of such a damaging raft of conjoining events can be mitigated to a certain extent. However, in the end, the general decay of personal spending power in global terms must start to affect overall growth.

In the UK the Bank of England is taking a different line, one of passivity, neither trying to fight inflation aggressively nor attempting to boost growth. The Treasury and Bank seem to be following a “Let’s Wait and See” plan. If banking crisis knee jerk reactions are almost certainly the wrong ones this amazing inactivity may eventually prove to be the correct path to follow. Having said that it does appear sometimes that Mervyn King is doing little while Rome burns.

The European Central Bank. The uber hawks. Jean-Claude Trichet et al seem content to throw entire economies to the wall in their never ending search for 0% inflation. Much is written about the events in Frankfurt contributing to a possible break up of the Euro but the currency is now so imbedded into the various Eurozone economies that it would be virtually impossible, now, to break out. As Simon Denom of Capital Spreads put it, “For all of the fulminating of the Mediterranean members over the current intractability of the central bank and the loud threats of ‘I can always leave if I want to’ the simple fact is they made their bed in the late ‘90s. Now they must lie in it”. The one thing that might be up for grabs is the independence of the ECB itself if enough countries become frustrated with the banks policies. However if this was likely then the Germans might well pick up their ball and leave the game. The Germans, uniquely in the European arena, have been through not one but two bouts of hyper inflation in the last 80 or so years. The first, it can be argued, created the conditions for dictatorship and the second smashed savings by about 90%. It is this albeit fading memory that drives the German fear of political influence in macro financial affairs. And it is this phobia which appears to be the overall driving force behind the ECB thinking.

But which of these three policies will work and which will be taught in schools? Personally I believe that, within reason, all three will probably end up with pretty much the same result as the influences on all the Western nations are to a great extent not internal but external. Underlying commodity prices are the driving factor in much of the inflation bubble and a growing economic power in the East is causing ever higher wealth transfer out of the west. The major internal factor is the current financial sector woes which can all be sourced from the same problem of over-inflated property values. As with all valuations this will probably swing from ridiculously over priced to bizarrely cheap over the next two or three years and nothing that any central bank does will, in the end, have made a blind bit of difference.

As a slight aside, for all those out there who want exposure to the property market without putting your house on the line you can now spread bet with IG Index on the rise and fall for both UK and London house prices.

Online Spread Betting Risk Warning

Spread bets carry a high level of risk to your money and may not suit all forms of investor. You can lose more than your initial investment so make sure you only speculate with capital that you can afford to lose. Likewise make sure you understand the risks involved and seek independent financial advice where necessary.

New car finance and used car finance help people to get the car they need if they do not have the money themselves. Some dealerships actually finance, but most often, the dealer has a preferred lender they work with to approve funding. The borrower’s credit will definitely be an issue during the approval process. If the borrower does not have a long enough credit history or has negative items on their credit report, a co-borrower might be required in order to obtain this guaranteed car finance.

Any type of car can be financed with Guaranteed Car Finance loan, whether the driver wants to buy a car, a car, or a sports car what a student or other fellow wants to buy. Be smart and make sure the car is a safe choice and also that it will be dependable. A new car loans enables a driver to purchase a vehicle, which otherwise, they would not be able to do. An automobile is a large expense, regardless of the make or model. Even the most inexpensive vehicles cost at least ten thousand dollars.

Paying on this Automotive Loans is as important as paying on any other debts. When possible, borrowers should pay more than the monthly payment amount in order to pay off this easy car loan more quickly. This will reduce the amount of interest paid over the life of the loan. When searching for a new automobile, choose a reputable car dealer who offers a good warranty, as well as a good price. Buying a vehicle is a great investment, but it is also a large financial responsibility. Take care of the vehicle with proper maintenance and repairs when needed.

Many people will have the opportunity to buy a new vehicle so that they can get around because of car loan. A dependable automobile is extremely important for those who work outside the home and is key to the success of their career. Auto lenders realize this and are able to offer a wide variety of lending options to suit the individual needs of their borrowers. Choose a good loan with a reliable lender. Many drivers take the first lender they are approved with, often through the dealer. This is unwise. It is better to wait for a Low Interest Car Loan. Then borrowers won’t have to refinance down the road.

What is a Business Plan?

You can pretty much define a business plan as a resume for your business idea in mind. Some may say it’s like your company’s calling card. When you need money to start your business, or when you need an office space, your business plan is what will do most of the talking to convince your investors / lenders or property managers to believe in your business and give you what you need.

Why is it important to have a Business Plan?

The time that you spend on writing a solid business plan will pay for itself in corporate strategic and tactical clarity as your business grows. A solid business plan: (not in particular order)

• Allows you to describe your vision / concept in writing, helping your potential investors to understand and believe in you; it serves as a basis for discussion with third parties such as shareholders, agencies, banks, investors…etc.
• Allows you to identify the structure of your business, giving you the chance to focus on the big picture. Your business plan is the “framework” which your business must operate within. A solid business plan provides a considered and logical framework within which a business can develop and grow with business strategies in the long run (not for just short-term growth).
• Determines the startup and managing costs.
• Clearly defines your target audience and provides detailed research on your target market.
• Identifies potential opportunities and obstacles that the business may encounter down the road.
• Identifies the strengths and weaknesses of your business and your competitors.

No businesses are the same, and no business plans are the same. Your business plan is like your business blueprint; it should be unique. While it is important to be able to illustrate your business concept well enough for others to understand what you hope to be doing, the business plan is essential for your own use. It is about the process of developing the business plan; the process helps you to focus on exactly what you are trying to achieve. It will give you a lot more clear vision of the entire structure of your business as you develop your business plan through detailed research and planning.

A business plan consists of the following parts:

Executive Summary

• Briefly describes the business concept
• Highlights the important financial points of the business such as sales, profits, cash flows, ROI
• Clearly states the capital needed to start the business and to expand
• States legal information about the business, the owners and key personnel.

Business Description

• Describes the business structure on how it operates / profits
• Describes the nature of industry in which the business plans to operate
• Identifies the business’ current position and future possibilities

Market Strategies

• Defines the target market
• Defines the strategies the business plans to use in order to tap into the target market
• Describes the pricing of products or services with respect to the demand of the target market

Competitive Analysis

• Describes the competitors in your target market and how you plan to obtain your share of the market
• Analyzes your competitors in the following categories: product, distribution, pricing, promotion, and advertising.

Design and Development Plan

• Describes the steps the business will take to carry out its plan with scheduling and cost analysis.
• Identifies the risks during the development period

Operations and Management Plan

• Describes the strategies the business will implement in order to operate and grow effectively

Financial Statements

• Defines all the financial aspects of a business.