NO ENTREPRENEURS, NO RECOVERY FOR THE ECONOMY

It is a fact that almost all new jobs are created from NEW firms and those that are less than 5 years old.

So, how is that formation of new firms going this year...as a means of calculating how many new jobs may be created?

So far this year, new incorporations are OFF BY 50% from the prior year. That is so far, at least .

Let's evaluate all the compelling reasons why an entrepreneur would form a business this year.

Ummm, I think....yea, maybe due to...., ????

It seems that I can not find an inducement to do so that is right at the tip of my tongue.

All I can think of is that taxes for entrepreneurs are going to be increased to pay for all the other people who are not working, or can not pay the mortgages for their houses, or their credit cards, or are illegally here and need free health care.

So as an entrepreneur, heaven forbid that he makes a profit as a reward for all the hard work, then he needs to pay, and pay and pay for everyone else's failures.

Just to add more crazy ideas from our government, our President's home state of Illinois, is proposing, in the middle of a recession a 50% increase in the State income tax. And these guys get paid for what?

This is NOT a way to jump-start the economy, DUH!

If these new businesses are not formed, and if their formation runs at this rate, there can not be a recovery, since there will be no new places to get work.

Old line, old established firms are firing, not hiring.

Even the firms that are being bailed out, are being forced to fire people, not pay them bonuses, and otherwise are becoming less attractive places to work.

Furthermore, entrepreneurs are people who have typically tapped into their savings or their investments to get the initial capital to start a business. So with the market decimating about half of everyone's investments, the urge to start a new business has been thwarted by the very fact of having less available capital to do so.

There are less businesses being formed, because there is less money to do so.

There is also a lot less credit to do so due to the diminished FICO scores or potential borrowers.

So between the lack of investment capital, and the lending restrictions by banks and other lenders, there will be less business formation and expansion, thus less of a chance for that instant recovery predicted by Ben Bernanke, and other future crystal ball readers.

What we are seeing, for the first time in my life at least is a Washington, D.C., full of business advisors, advising businesses how to operate, what products to make (car industry forced mandates for instance), how much CO2 to throw off, or how many times a cow can belch.

It seems that people who for the most part have never owned a business, never risked money to start one, never employed anyone on their own, exempted themselves from all rules and regulations applicable to all businesses, are now in charge of everyone else's business.

Now that is certainly a way toward financial disaster, and NOT a recovery.

No entrepreneurs, no recovery....write that down, pass it on to your favorite Senator and Congressman.

DEADBEAT COUNTRY (ALMOST)…..USA

DEADBEAT COUNTRY (ALMOST)…..USA

What if you had a banker or another creditor who did not really like you, but you owed him $1.3 TRILLION dollars?

What if you however, want or desperately need more and more money to be borrowed from this person?

Under those circumstances, could you say and do anything you want and risk getting this person angry?

But, what if this person had run out of money to lend you any more money to support your apparently lavish lifestyle which obviously requires more and more borrowings from him?

WELL FOLKS THE LENDER IN THIS CASE IS CHINA AND JAPAN, AND THE NEEDY DEADBEAT IS THE GOOD OLE USA.

The USA needs money to support its “lifestyle”, but its biggest creditors are running out of money to buy TREASURY securities, since their economies are not generating the cash surpluses any more, which could then be used to buy more of the securities.
Is that simple to understand?

What if then, instead of buying more debt, the creditors simply say that they need the money back?

Think about that, what happens when you do not have the money to pay back YOUR creditor….your FICO score suffers, and you pay exorbitant interest rates!

Then another thing happens….as consumers and businesses of every type try to borrow money they will be competing for the available money with the government!
So far, it does not sound like a recovery is coming, does it?

Get A Loan from These Stupid Lenders

Get A Loan from These Stupid Lenders

Don’t you just feel great is you walked into a bank to get a loan, and you discovered that there was no lending standards?

You just happened to come into the bank during a special lending period during which there were no requirements for collateral, nobody cared if your business was profitable, nor did you have to make any sense explaining how you were going to pay back the loan?

In reality the only thing you had to say was that “you needed the loan, now, today preferably, before you walked out of the bank. And if possible, could it be for a billion dollars, no, make that $25 billion!

Well folks ,that is the short explanation of what public education educated congressional watchdogs of our tax money are now doing. So, get in line, the patients are running the asylum !
Any lender, in fact anybody with any brains will tell you that a bank will consider lending money to a business with a history of successful operations, and a profit forecast that shows how the loan can be repaid.

Our politicians, most of whom have never had a real job or ever run a business, do not know this “secret” to successful lending.

They in fact are ONLY willing to lend money to borrowers with NO CREDIT, NO possibility of repayment of the loans, and only if they are in business models destined to never make money, such as the auto industry in America. They are only lending money to losers, instead of successful businesses that will continue to operate at a profit, and will actually continue to employ people.

They are not even remotely considering lending money to any successful business. They are only supporting losers. They say that they are doing this to save jobs.

This is what they would have said to the last horse buggy manufacturers, and the last street gas light manufacturers, and the last steam locomotive manufacturers, and the last horse plow manufacturers and the last horse rental business, and the last musket manufacturers. “We have to save these jobs!”.

Dummies….this is elementary…the auto industry will NEVER be saved by government supported artificially unrealistic wages and benefits of $75 an hour. Nobody can afford the cars that they build.

I just saw at a WAL-MART, a Chrysler Charger automobile with a sticker price of $45,000!
The last time I bought it, it was $3,900, and therefore it was affordable.

The auto industry needs no saving. There will be a need for autos, and they will always be built by some company. Do these autos have to be built by companies that are pricing their product out of reach of their buyers? Yes….so go figure, they want to save an industry from shutting down even though consumers do not want their product…go figure.

There will always be auto companies to meet consumer demand….at some price and on some terms that only a free market will dictate.

Just name one thing the government can do correctly ? Go ahead…Think about health care the government way…think the VA hospitals for instance; rats, mice mold and dicey healthcare provided by people that can hardly speak English.

Now, they only want to lend money to losing businesses…what a business model for guaranteed failure.

I will give you odds as a bookie on how much GM and Chrysler will re-pay of the loans…make that 100 to 1 that they will never repay the loans…..