BloggeRhythms 5/3/2012

Over the course of the past several weeks I've been mentioning some of the horrendous mistakes made by the current administration, as well as some of the inane things done by Congress to boot. And a parallel to things seen in my professional life dawned on me for the first time this morning, which frankly surprised me, because it's so fundamental I should have noticed it a long time ago.

I've spent most of my business life leasing and financing equipment to businesses of all types. That endeavor involves creating solutions and alternatives generally far more sophisticated than simply lending, such as bank loans, and since significant amounts of funds are usually involved, customer's financial worth is always a major consideration. And, beyond that, accurately assessing the involved risk includes determining how a prospective customer's assets were actually attained.

Makeup of prospect's assets ordinarily derives from combinations of investment and, most importantly, profits attained from successful operation of a business over time. Positive performance tends to increase credibility and demonstrates substance. On the other hand, there are enterprises that may have significant capital, however, if the funds derive significantly from investment, or perhaps some type or other of loan, ability to sustain hasn't yet been proven, greatly increasing a lender's risk.

Now, while the factors listed above may seem quite fundamental, there's another aspect to worthiness that's equally important, but I think far more subtle. Because lender's risks can significantly multiply dependent upon where invested capital comes from. And to that extent, here's the difference.

Established, profitable enterprises are ordinarily comprised of management's that not only may have invested capital but also tend to develop a sense of belonging and pride that bonds them to their businesses in very personal ways. Consequently those lending to them are additionally "insured" by those traits because those types of borrowers usually do whatever they can to protect their enterprise.

On the other hand, though, businesses running on outside investment and loans are dramatically different because although management may have very strong desires to succeed, it's still not the same as having real "skin in the game" which tends to lessen the impact of failure. And, it's certainly easier for people to recover from losing other folks money than it is to part with their own.

And there we have it, since I finally realized that almost all politicians carelessly make those countless stupid decisions simply because they're all playing with other folks money and lives. And while a failed business enterprise may cost an entrepreneurial type significantly,  an out  of office politico loses practically nothing except some income from the lost job. Therefore, with no real risk and almost nothing at stake regardless of how inane and senseless the legislation, the typical clown in power walks away Scott free from failure without a backward glance.

Now, while the forgoing hopefully illustrates the problem, I frankly don't know at the moment what the solution is. Because in the commercial world that I'm familiar with people who make stupid decisions quickly lose their businesses, jobs and perhaps their future hopes. And maybe, that's the difference between productive people and politicians, since total incompetents in office can get by simply slinging total BS and not ever having to prove anything at all.

That's it for today folks.

Adios

BloggeRhythms 5/2/2012

In keeping with my belief that the best thing Mitt Romney can do to win the coming presidential election is just to sit back and let the bumbling incumbent keep burying himself politically, two more problems have occurred in that regard.

There's been considerable negative backlash about the president's recent "secret" trip to Afghanistan to try to take personal credit for the job Navy Seals did in taking out Usama bin Laden. And today, for a different dose of bad news, according to Reuters, "New orders for U.S. factory goods in March recorded their biggest decline in three years as demand for transportation equipment and a range of other goods slumped, government data showed on Wednesday." Then they went on to state that "The Commerce Department said orders for manufactured goods dropped 1.5 percent after a revised 1.1 percent rise in February."

And, to me, this is another illustration of the administration's total ignorance of how the U.S. economy really works, as I've been mentioning often lately. Because there's really no magic to increasing production, business growth or revenue generation, the answers are actually quite simple. It doesn't take a PHD in economics or finance to understand that the billions of dollars spent overseas for oil come directly out of consumers pockets. And that means they have far less to spend here. 

Add to that government agencies who've been charged with assessing penalties and fines on almost every aspect of doing business you can think of, and even an abject moron soon realizes that this is absolutely not the time to invest or try to grow a business in the U.S.  Why would anyone with the ability to think, operate an enterprise which bureaucrats view as only a growing source of revenue for their hare-brained schemes and planned redistribution of "wealth."

Therefore, as you go down the list of moronic decisions foisted on those who generate income it's quite easy to see that when an economy's run by people who don't even understand basic business fundamentals not only does growth stunt, but things actually go backwards. And to many that's certainly not surprising, because stifling the American dream was one of the incumbents campaign vows.

That's it for today folks.

Adios

BloggeRhythms 5/1/2012

So far it seems, the Romney campaign is using its head and not exerting itself to insult, defame or antagonize the POTUS, but instead is simply letting his administration self-destruct due to incompetence and ignorance about their audience. Because yesterday there was another deluge of complaints about the incumbent, this time about his attempt to credit himself with Usama bin Laden's demise, while patting himself on the back for work that was done by several thousand others and, in fact, occurred because the stage was set by his predecessor, "W" Bush. 

According to Fox News on-line, criticism mounted Tuesday for the alleged politicizing of  the anniversary of Usama bin Laden's death, with "Senator John McCain scolding the commander in chief and former New York Gov. George Pataki going so far as to call on Obama to apologize." McCain said,"You know the thing about heroes? They don't brag."    

Pataki, Governor of New York during the September 11, 2001, attacks, said he was "appalled" by the president's political treatment of the raid, going on to state "You don't celebrate your brilliance when it's because we have brave young Americans out there, putting their lives on the line. I think it's wrong, I think it should stop and I think the president should apologize."

Beyond that, even the president's former Joint Chiefs of Staff chairman, Admiral Mike Mullen, warned on NBC News about allowing the raid to be used as a campaign tool because, "The decision that he made and obviously the result stand alone in terms of the kind of call presidents have to make and he made it. I do worry a great deal that this time of year that somehow this gets spun into election politics. I can assure you that those individuals who risked their lives - the last thing in the world that they want is to be spun into that, so I am hoping that that doesn't happen."

So, going back to my original point, the best thing for Romney about presidential gaffes like this is that the odds are that they'll keep occurring. Because the reason for them in the first place is the incumbent being nothing more than a political hack who doesn't know any better. And since he's obviously not learned very much, nor matured after three years in office, I truly doubt he'll improve a great deal over the next seven months.

That's it for today folks.

Adios

BloggeRhythms 4/30/2012

I keep reading about the huge amount of funds the incumbent's raising to spend on his campaign, predominately on advertising. I also come across talking heads on the tube who blabber about the public, referring to vast segments of the population as "they or them." For example, a pundit will say something like, "The president made that comment because he believes "that's what they want to hear."

And that's where they lose me because I always wonder exactly who "they" are. Because it seems to me these political "experts" live in a world that doesn't really exist any more, and so does the POTUS, whereas in today's day and age I believe voters are not only as well informed as the politicos, many, if not most, are much smarter and very far from naive.

So, what that says to me is I doubt very much that ads are really going to sway people's thoughts when their everyday lives tell them something that's entirely the reverse. And by now I think huge segments of the population that have seen the economy sink, watched enactment of laws that not only make no sense, they do significant financial harm, and see evidence everyday that the nation they built is being reduced to third-world status, are not going to vote for someone based on a flashy ad.

As for me, I've never paid much attention to ads to begin with, and frankly they're one of the reasons I rarely turn the TV sound on. But even if I heard the words it wouldn't really matter. Because since experience taught me long ago that while a burger may look like it's absolutely perfect on the tube, yet actually tastes like plastic, I'm no longer easily fooled.

Consequently, I believe the president can spend as many billions as he wants on ads and smoke and hype, but in the end it'll be his actual performance that counts with the voting public. And that's why if he truly wished to help the country, he'd drop the ad campaign and apply the funds to the national debt his failed programs have taken to almost sixteen trillion dollars.

That's it for today folks.

Adios

BloggeRhythms 4/29/2012

Years ago, I was fortunate enough to be invited to join a sales force comprised of some of the most talented folks in the nation, working for the most successful lessor of equipment that industry had ever seen. And there I naturally gained the opportunity to work-side-by side with some extremely bright and highly intuitive people. 

There were many things that made the job exciting, and the rewards for success were huge compared to most other endeavors, however, the employer knew this quite well and thus, not only expected but demanded stellar results. Consequently, the bargain both sides agreed to upon one's accepting employment was that if the sales results projected weren't achieved by the end of ninety days, the employee was terminated without discussion...no if's, no and's, no but's. Kaput.

Now, as far as the ninety day performance goal was concerned, it didn't just apply to the first three months of acclimation to the job, it was continually adjusted and was reinstated every single quarter down the road, the rationale being that the marketplace didn't ever coast so why should salesmen? And aside from that, there were scads of high-performers elsewhere who'd gladly work their tails off for the chance to join this elite team which was very well known to all, and who would have been delighted to replace a faltering member in a heartbeat or even faster without a scintilla of remorse for the terminated goner.

When I came on board with this organization, my manager was one of the most successful performers in their history, and as I think would be expected, extremely, bright, articulate, clever, well educated and by then, highly experienced to boot. In fact, he was exactly what you'd expect someone to be that was tasked with financing top-of-the-line IBM mainframes and peripheral equipment to some of the most highly recognized businesses in the U.S. High six-figure transactions were every-day routine, with configuration costs going up from there amid a highly competitive market segment. To win in this arena one had to be very, very much better than simply extremely good.

I thought of him today because I clearly remember his early words to me when I inquired about getting acclimated to my new job. He suggested that the best way to understand what our employer -or any other for that matter- wanted was to read the compensation plan in detail. Because within the plan there will be varying degrees of incentive for different types of sales, and obviously the highest amounts will be rewarded for the one's the company wants most. And that factor by itself will tell you where to spend your time wisely. He went on to say that he thought that basic premise was universal and applied to most business situations regardless of type.

Looking back on my manager's theory now, I realize that one of today's economic problems overall is that there's no government plan or incentive to stimulate economic growth or success at all, but instead...all kinds of penalties for failure. In fact, not only is there much more emphasis on penalizing businesses in whatever manner can be contrived, the objective seems to be headed for fining producers first, collecting from them, and forcing them to prove their innocence later. Therefore, the whole dynamic of building a thriving economy is upside down.

So, in summary I guess the solution to productive growth is pretty simple. All government needs to do is put a plan on the table that incents businesses to grow via financial incentive, such as tax breaks or credits for reaching particular goals. And once they do that all they have to do is keep quiet, stay consistent and get out of the way. The success will quickly take care of itself.

That's it for today folks.

Adios

BloggeRhythms 4/28/2012

An item on almost all news outlets yesterday concerned the GDP, which most analysts expected to grow at a 2.6% rate or more in the January-March period. However, the result was only 2.2% attributed to a slowdown in business investments and a smaller inventory buildup.
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I mention it because although I should be used to it by now, I still can't figure out how folks in government can't seem to figure out how damaging their policies are to the economy, or worse, don't care. Yet, everything they desire, which is predominantly the feathering of their own financial nests, depends on the financial success of the nation. And that means that either they have no understanding of the most basic economic premises whatsoever or are intellectually denser than sludge.

Whichever of the preceding cases is true though, and despite the fact that the situation is far from amusing, I still have to laugh at their actions, because no matter how fast they try to react and how creatively they try to rein in the business sector, they come up miserably short due to ineptitude.

The evidence of government's failure to improve the nation's economy can best be seen by the quarterly results of the largest employers. Because most of them are not only doing quite well, they're hiring at much higher levels. However, the personnel expansion's taking place overseas where labor's cheaper and taxes are lower. As far as U.S. growth is concerned, these same businesses are investing in technology and automation to avoid governmental strangulation via taxes and regulation while lowering payrolls.

As far as small businesses are concerned, which are the economic backbone of the U.S., they too are scrambling for loopholes in regulation, fees and charges which in turn harm private sector employees. Instead of bringing folks on full-time, for example, they reduce individuals work-weeks, thereby eliminating payment for benefits and perks. The same goes for health care insurance. And in that way, they'd rather grow at a slower pace, if at all, rather than having business income increases taken right out of their pockets to support worthless bureaucrats.

So, what we have here is a growing government that is working at a huge disadvantage. Because by trying to fleece American businesspeople, they're attempting to corner folks who are much smarter than they are, and that might work in the short run. But over time, as we can see in the lackluster reported results of the last quarter, the businesses themselves are seemingly doing quite well but government can't figure out where the money is nor get their hands on it.

That's it for today folks. 

Adios.

BloggeRhythms 4/27/2012

Today's subject regards confusion. Because although I've generally considered myself to be reasonably intelligent and able to grasp subject matter more often than not, there are times when I simply can't understand things going on around me at all. And this is one of those instances.

I've been mentioning for quite some time now the horrendous damage done to the nation by the administration via its campaign to wipe out U.S. production of fossil fuels. Along those lines I've even speculated about whether the reason is purely due to lobbying environmentalists or perhaps as payback to George Soros and moveon.org for especially vigorous campaign support.

However, regardless of the reason for the war on gasoline, the results the same. Significant damage has been done to the overall economy, unemployment remains abnormally high, creeping inflation exists in segments related to fossil fuel usage and domestic business expansion is not nearly as robust as anticipated.

Now, while all the preceding has been discussed, rehashed and speculated upon in media coverage, it wasn't until just yesterday that visual proof of a focused attack on U.S. oil production surfaced by way of a taped EPA conference in 2010. The video's featured speaker was, Al Armendariz, a presidential appointee in November 2009, as  regional director of the agency's Region Six, which covers Arkansas, Louisiana, New Mexico, Oklahoma and Texas.

By now, I'm sure that Mr. Armendez' comments about his goal of intimidating and inhibiting oil producers is widely known, but here's the part I truly don't understand. How can something like this go on in our nation today? And how is it possible that a government flunky like this guy can wield enough power to add billions to the population's cost of living? And how can politicians accept the harm done to their constituents by blindly assisting a "leader" who's sworn agenda is to break the economic back of his own nation?

And that brings me back to my subject for today. Because I'm sitting here typing all these questions, reading them back and realizing that this situation makes no sense whatsoever. And that's because unless one is either completely deranged, or receiving some kind of huge payoff for themselves, who would willingly sit back and gloat about helping do their fellow countrymen in?

That's it for today folks.

Adios