BloggeRhythms

Yesterday’s theme touched on the critical importance of customer satisfaction for businesses to achieve success. When all boiled down, there’s no magic or mystery involved in the accomplishment. It ordinarily results from plain and simple hard work done by professionals in a particular field. That’s why in the finance business, prior similar experience is crucial to credit decision-making. Prior experience provides the expertise required for successful business operation.

In a typical lending situation of any type, a primary concern of lender’s is the background and performance history of the applicant. For established businesses, a number of prior years financial statements or tax returns will ordinarily be required. That information provides the basis to best estimate future performance. Was there profit or loss? Are sales and income trends up or down? Is there a firm financial footing or net worth to offset any unexpected loss? None of these questions are meant to pry, but simply to help in assessing any lender’s risk.

In the case of new businesses or “start-ups,” whereas business performance records do not exist, similar information would be required of the individuals involved. Is there similar business experience held by the owner or amongst the management? Where and how was that experience obtained; through education, in a similar enterprise, yet to be formulated? Here again, there is nothing extraordinary about the inquiry, but simply the gathering of enough information to determine the level of risk involved on the lender’s part.

In effect, there is really nothing overly complex in basic credit-decision making. Knowledgeable lenders apply every day common sense in gathering and analyzing applicant’s past performance information to best assess the probability of loan or financing repayment in the future.

Moving that one step over, in effect citizens were taking the same kind of risks as do lenders when they voted in 2020. When campaigning, Democrat politicians promised all sorts of performance and results in the future with no tangible means of proof. Therefore, all that could be obtained for success probability determination was any kind of information establishing performance in a similar situation.

At present, the 2022  U.S. budget proposes $131.8billion in discretionary budget authority and $1.5 trillion in mandatory funding. Who amongst the four most visible Progressives had experience managing those kinds of dollars? What were the results? Obviously, no such experience existed and thus, no performance evidence was available.

While not having direct control of any type, Biden did have experience gained during his time as VP in the Obama administration whose philosophies can be seen in the implementation of Obamacare where: “After the enactment of Obamacare, one fast-food employer testified to Congress that the employer mandate would force businesses like his to “increase the number of part time employees; decrease the number of full time employees and attempt to automate positions (such as replacing cashier positions with ordering kiosks).” An analysis by the Hoover Institution found that there were 2.6 million workers at risk of having their hours cut because of the 30-hour work week rule. According to the study, 63 percent of those most at risk of lost hours are female and almost 60 percent are between the ages of 19 and 34. The study also found that those most vulnerable to the 30-hour rule are less educated – 89 percent lack a college degree. The median income of workers at risk is $14,333 per year for individuals and $29,126 for families.”

While much of the Obama economic policy has since been forgotten, it certainly exists, as does the turnaround engineered by Trump who prior to the pandemic presided over the strongest economy since WWII.

Thus, continuing with a prudent lender’s approach and lacking hard financial evidence to analyze, the next step would be to assess the performance of similar endeavors to get a sense of future probabilities. How have others performed in similar circumstances? It’s likely the closest one could come to the vision of the four most influential Progressives would be the Carter administration. So, how did that one do?

Lacking further evidence here, foreign entities will have to suffice. In that case, how has the economic history been for the Russian population? Cubans? Venezuelans? Chinese citizens? North Koreans? North Vietnamese? That question answers itself.

So then, the next thing to look at would be the basic premise of Socialism itself where:  All legal production and distribution decisions are made by the government, with individuals dependent on the state for food, employment, healthcare, and everything else. Which makes skills, talents and capabilities of leadership the most critical aspect of the entire enterprise.

Taking the $131.8billion in discretionary budget authority and $1.5 trillion in mandatory funding into serious consideration, would any prudent lender truly turnover managerial authority to Biden and the four Progressive cohorts?

Nonetheless, while the skills and experience of a sophisticated lender would never permit extension of the smallest percentage of the nation’s budget to a group so lacking in successful financial performance, that’s what the nation’s voters did. And today, results are in evidence. Unaffordable gas and oil, inflation exceeding 8%, threats of ever increasing rules and strangling regulations along with expansion of government everywhere with absolutely none of it truly surprising at all to any voter doing their homework in the first place.

That’s it for today folks.

Adios