Sunday, July 13, 2008

There are always winners and losers when the economy struggles

Counter to the mainstream media’s representation of the economy, I believe that the economy is struggling, but not contracting (recession). I am in the minority since most of the headlines have the familiar recession ring, like “Obama: 'Little doubt' U.S. has moved into recession.” It is a wonder how anyone can leave the house if the so-called sky is falling. Sorry about the thick sarcasm, but what can a girl do?

Scooters Go Green

Yesterday, after I finished my Fannie Mae and Freddie Mac saga, I took a walk to Castle Island in South Boston. Along the way, I noticed an oddity for South Boston: a large “Scooters Go Green” store sign.

You know what they say about real estate: location, location, location. Clearly, the store owner of Scooters Go Green is not worried about the new store’s location on Old Colony; it is adjacent to a bar (the Stadium), across the street from several industrial factories (the Iron Works, for example), and just down the street from the projects.

Somehow, amid all the talk of credit crisis and recession, this store owner was able to acquire capital and start a business (sarcasm again). Further, he believes that the demand for scooters will be sufficient enough to create profits to support his family. Is this storeowner crazy? I think not.

There are always winners and losers in economics; as my Mom would say, when
God closes a door, he opens a window. Even with oil topping $145/barrel, gas at $4.11/gallon, housing wealth taking a beating, and the U.S. equity markets officially in bear territory, new business opportunities abound. There are stocks to buy, bonds to sell, businesses to start, and money to be earned.

It is true that this economic cycle has produced many casualties. Big losers include Nordstrom, Home Depot, Target, United Airlines, and Morgan Stanley (to name a few), who are all booking negative Q1 earnings. But contemporaneously, there is a long list of winners including Petrohawk (my Dad’s company), Schnitzer Steel, TiVo Inc., The Gap, and HP (to name a few) who are all marking positive Q1 earnings (Q2 earnings will soon be out). Just because the economy is struggling doesn’t mean that investment and money flow will come to a grinding hault.

Be smart in your business plans. Americans are looking for alternative modes of transportation, and a Scooter is the way to go if gas conservation and quick transportation are of upmost importance. The Scooter Store owner is not crazy – he just has good business sense. Why wait until scooters are in high demand to open up your shop? It is best to get in early on a good idea and rake in the dough while you are one of just a few scooter shops in the area.

A side note about Barack Obama

It is too bad that the self-proclaimed candidate of change, Barack Obama, does not speak of hope and opportunity. Instead, he touts struggle and hurt. Over the weekend, Senator Obama declared that there "little doubt we've moved into recession."
He wants to push his not-so new stimulus proposal, but only at the cost of America’s economic hope. I certainly don’t want to elect a President that is only willing to focus on the negative aspects of the economy.

I am not the only one on the internet that sees both good and bad news in the economy. I recommend that you read a great article written by Russ Wiles at the Arizona Republic, “Despite the economic worries, there are a few pieces of good news.” He maps out positive news that has clearly been overlooked in the mainstream media. Here is an excerpt from his article:

“Americans, lighten up a bit.

The national mood is clearly in the dumps these days amid worries over foreclosures, spiking fuel prices and other economic pressures.

Surveys portray a dispirited public, underscored by a massive drop in that most telling of opinion polls, the stock market. But not everything has unraveled on the economic front.

Here are a few examples of reasonably good news:” ….

You will have to read on to get all of the good details. Be happy, tomorrow brings a new day.


Please leave any comments or reactions to this article. Best, Nontruths

2 comments:

  1. Enjoyed the Russ Wiles article; possitive news deos not "sell" but sure is refreshing.
    Re: Quarterly reports; GE announced last week that earnings were slightly down from 2nd Q 2007. If GE, an internationally exposed company, has only that loss for the 1st half of the year, things are not all that bad. Again, it is trouble in an economic sector and not the full economy. In the 2000 downturn, portfolios took a hit but by 2005 and bounced back with wonderful gains. Just keep in the market and don't sell low and buy high. Possitively, janie

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  2. Have to learn to spell "positive"!!~!!! janie

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