Sent to me by a friend, this is a good reminder that despite the economic crisis and runaway recession each of us are in control of our own future, if only we agree to disagree

His teachers said he was “too stupid to learn anything.” and was fired from his first two jobs for being “non-productive.”
Thomas Edison’s 1000 inventions came during the Panic of 1873 — 6 years — and the Long Depression — 23 years.

He did not speak until he was four years-old and did not read until he was seven. His parents thought he was “sub-normal,” and a teacher described him as “mentally slow, unsociable, and adrift forever in foolish dreams.”
Albert Einstein survived one Long Depression, three panics and Post WWI Recession.

He failed sixth grade and was subsequently defeated in many elections until he (Winston Churchill) became Prime Minister at the age of 62.

Only a mediocre pupil in undergraduate studies and ranked 15th out of 22 students in chemistry.
Louis Pasteur was ranked 15th out of 22 chemistry students.

It is said this farmer boy could not read nor write, failed and went broke five times. His company has survived 8 Recessions, 1 Oil Crisis and 1 Great Depression.
Hopefully Ford Motors will make it through this.

He was not allowed to wait on customers when he worked in a dry goods store because, his boss said, “he didn’t have enough sense.”
FW Woolworths was founded during the Long Depression that lasted 23 years with a loan of $300 and in 2001 changed its name to Footlocker.

Fired by his newspaper editor who said, “he lacked imagination and had no good ideas.” He went bankrupt several times before he built the largest entertainment company in the world.
Walt Disney’s creations have since survived 1 Great Depression and 7 Recessions.

After his first screen test, the memo from the testing director of MGM, dated 1933, read, “can’t act, can’t sing, slightly bald, can dance a little.”
Fred Astaire’s career lasted 76 years and was launched during the Great Depression.

School dropout and child runaway, this individual used $105 from his first social security check at the age of 65 and sold his franchise after 9 years of attempts and during two recessions.
The world knows him as “Colonel” Sanders, founder of Kentucky Fried Chicken.

Trained ambulance driver and later a milkshake machine salesman, this guy took over a small scale franchise and built the company into largest fast food restaurant in the world.
Ray Kroc bought McDonalds during Recession of 1953.

The first time he walked on-stage as a professional comic, he looked out at the audience, froze, forgot the English language and was jeered offstage.
The Seinfeld show will pay Jerry over $250 million.

Decca Records and Columbia Records turned down a recording contract with this group suggesting, “Groups of guitars are on the way out.”
The Beatles delivered 292 performances in one year at a seedy little club in Liverpool before they were discovered!

He handled the violin awkwardly and preferred playing his own compositions instead of improving his technique. His teacher called him “hopeless as a composer.”
Beethoven wrote five of his greatest symphonies while completely deaf.

Is there a message here?
1) Never Quit
2) Everyone has problems!
3) Recessions don’t kill anyone!
4) Do something spectacular.

Small businesses that have money management and debt problems are anxiously waiting for the new credit card rules to go into effect in July 2010. But the majority of business owners need immediate debt relief. While the new rules will help, for some it will be too little, too late.

The main problem with using credit to finance your business is that it is a big risk. That risk, of course, is you are promising your future production to pay back that financial obligation in full and in a timely manner. There is really nothing wrong with using credit as long as there is virtually no risk involved in paying the money back. There is a lot wrong with being over your head in debt and being handcuffed to the credit cards. This is risky in the extreme, because with just one or two bad months, the house built on using credit lines can fall very quickly.

I am glad to see the new credit rules passed. What I am not happy about, however, is the length of time until credit issuers must comply. The current credit system has driven some individuals and businesses into bankruptcy and the rest of the nation to the very edge of financial disaster. The credit rules could have been mandated to be effective in 2 or 3 months rather than 18 months and it would help the economy now when it desperately needs it.

Living in a condition based on credit and debt is very, very risky. Done on a national scale, and helped along by exorbitant interest rates, over-limit fees, late charges, and a 22-day billing cycle, the nation’s consumers are $850 plus billion in credit debt and it is evident they are sinking fast. The new rules are a long overdue step in the right direction.

What are some of these new rules that everyone is talking about? Simply stated, the new rules prohibit:

- Placing unfair time constraints on payments. A payment could not be deemed late unless the borrower is given a reasonable period of time to pay. This would eliminate many of those exorbitant “late payment fees.”

- Placing too-high fees for exceeding the credit limit solely because of a hold placed on the account.

- Unfairly computing balances in a computing tactic known as double-cycle billing. This two-cycle method enables billing offices to charge interest on balances that were part of the previous month’s balance, even if the balance was paid in full.

- Unfairly adding security deposits and fees for issuing credit or making it available.

- Making deceptive offers of credit.

Two excellent provisions of the new rules are: 1) that customers will be given 45 days of notice before any changes are made to the terms of any account, including jacking their rate for missing a payment or paying a bill late, and 2) banks must apply payments (beyond the minimum) either to the balance with the highest rate or proportionally across all balances. The second one eliminates beyond the minimum payments to be applied to only to the lowest (or 0%) interest rate principals first.

When someone balance transfers to a zero interest rate card and then uses the card for purchases, the purchases are typically billed at a very high interest rate. What consumers fail to realize is that the bank will apply payments only to the zero interest balance while the higher rate purchase racks up interest charges until the entire zero balance principal is paid off. That sabotages the whole debt reduction strategy of the zero balance transfer.

While the Associated Press is calling the new rules the most sweeping clamp-down on the credit card industry in decades, I’m wondering why the clamp-down on the abuse took so long to be addressed, and why the banks are being given 18 months before the new laws go into effect. With modern technology we can move and make changes almost at the speed of light, so 18 months is like moving at the speed of a glacier.

As I have been doing for the past decade, I still advise business owners and consumers to use the 5 old-school money management tips on reducing debt that they can employ right now to start digging themselves out of debt and get their own personal economics healthy.

Money Management Strategy #1 – Stop Using Credit

The place to start is by locking away the credit cards and figuring out how to cut expenses back to function within your income. Unsurprisingly, this first step can take quite a bit of discipline. Paying operating expenses with credit cards can easily become a habit, and as a result, can rapidly build up debt for the small business.

Figure out ways to increase your income and instead use only cash. This is the single most effective action you can take to begin the process of debt reduction.

Money Management Strategy #2 – Never Spend More Money Than Your Company Makes

Paying for items with credit because you don’t have the cash is the recipe for economic slavery. Using credit in that manner commits your business’ future income to pay the credit company.

Business owners must get creative and find ways to increase the company’s income, and then use it to pay both current expenses and to pay off past credit debt. Additionally, a business owner must take a ruthless look at what expenses are absolutely necessary. Business expenditures should be expected to bring in more money, business, and income. If they don’t do this—don’t directly lead to the creation of more income in some way—then determine if the company can do without certain items in the short term.

Money Management Strategy #3 – Always Pay More Than the Minimum Payment

Set a goal to pay at least 3 to 5 times the minimum required payment on each credit card and line of credit. Paying the minimum amount due on credit payments is a financial trap that keeps you perpetually in debt.

An effective way to reduce the debt is to take 10% to 15% every week off the top of the company’s income and use it to pay down the debt. Don’t wait until the statement says the payment is due. Pay some on-line every week as soon as you earmark it for paying the debt. The added bonus is that you stop the daily interest compounding on the payment amount you made. That alone can save you thousands in interest over the long haul.

Money Management Strategy #4 – Never Spend Over Your Limit or Pay Late

Use old fashioned money management discipline and never sabotage your debt reduction program by getting hit with $25 to $39 over-the-limit or late fees. Banks, credit card companies, and other financial institutions make millions through financial penalties for being late or going over your credit limit. Worst of all, the money paid in penalties creates more debt.

Money Management Strategy #5 – Find Ways to Cut Expenses

While a fundamental requirement of any debt reduction program is more cash as fast as possible to pay the debt off, there is one important area that should not be considered an unnecessary expense. That area is marketing and promotion. Correct money management includes the continuous promotion of your company’s products and services. Marketing and advertising are areas you don’t want to stop spending on. Marketing is going to make you money and is a correct financial investment when properly done.

There is an old advertising saying that still holds true today: “When the economy is good you need to promote, and when the economy is bad you need to promote MORE!”

Whether an economy is in an economic depression, a recession, or is thriving, the above money management principals still apply. Money management for small business takes financial planning and discipline. Reducing debt is just one step in an overall program to ensure that a business will survive and make the maximum amount of money for the business owner. There are other steps in a successful money management program that can be taken to achieve your financial goals, and this will be addressed in future articles. For now, reduce that debt and improve the financial health of your own economy.

For more information about steps you can take to reduce your debt, sign up to receive the FREE Debt Reduction Solutions Guide. If you need further help with a debt management program, send an email to Sandra Simmons, President of Money Management Solutions, Inc. at info@MoneyMgmtSolutions.com  or call (727)448-1011

It is a little known fact that more millionaires were made during The Great Depression than in any other era in U.S. history. Want to know how that happened so you can cash in on the economic crisis looming on the horizon?

I did a lot of research work to find the real facts, not just the historical data we are spoon-fed by the media about how hard the depression was on the masses and how hard the President worked to turn the U.S. economy around. It takes digging through piles of research documents including the copyright and patent office files and the Library of Congress to find a lot of the data. However, you can also find a lot of information on the internet if you dig deep enough.

There is one golden nugget in this history lesson that can enable you to make tons of money when our country is in a recession (like right now) because a recession is exactly the same thing as a depression except it doesn’t last as long and the damage is not so bad. So bear with me while I give you a short history lesson that contains this golden nugget.

It is important to know that the Great Depression actually started a few years before the 1929 stock market crash and lasted until World War II brought the country out of the Depression.

In the years before 1929, as more and more credit was extended to businesses and individuals the economy was tipping over the edge from available cash to way too much credit debt. When the amount of extended credit reached a critical mass and companies could no longer pay the credit bills, the companies crashed (the 1929 debacle.) When workers lost their jobs they could not pay their credit debts and the housing market and banking industries crashed.

All the business enterprises that were bought and sold during the depression by people with liquid cash are too numerous to mention, but because of the war effort, those with liquid cash who bought land, homes, companies, or invested in the stocks of the companies that made products that were in demand by our government for the war effort made millions. These industries included such products as:

1 – Metals: steel, iron and aluminum
2 – Communications: radios and parts
3 – Transportation: Aircraft, Tanks, boats and vehicles (and their parts)
4 – Armaments: Guns and munitions
5 – Boots, clothing, belts, backpacks, hats, blankets, tents and cots (and the textiles to make them)
6 – Containers
7 – Shipping – Truck Transportation – Railways
8 – Oil and petroleum and stocks in those oil wells (the Texas oil boom was a biggie!)

A few of the well known companies that changed hands during that period were John Deere, Douglas Aircraft, Reynolds Metals, Ericsson, and even the Goudy Gum Company – they were the first gum company to issue baseball cards with gum.

Some of the oppressive laws that our government passed during the 1930s were an effort to take money from the large number of people who had liquid cash and were using it to buy companies (or stocks in companies) as well as property. The government wanted to take it away from the people who had been smart enough to stash away liquid cash and not get into credit debt, and use it to fund the war effort as well as re-distribute it to the destitute families.

A word of caution here – Be careful to protect your cash. There are many banks that are in trouble, and while some have failed, many are on the government’s “likely to fail” list. How safe is your bank? You owe it to yourself to find out.

While your bank probably won’t reveal their rating if you ask, you can find out for yourself how safe you bank is by signing up to get my FREE Bank Ratings Report right here.

These laws were later ruled unconstitutional, but the point is that the people with liquid cash were spending it in way that made them millions, especially in industries necessary to the war effort. Yes, the stock market crashed, but the stocks could still be bought at undervalued prices and those with cash invested at the bottom of the market.

The tactic to be learned from this is a simple one that the people who use my Money Management Software implement right away. They stash cash. In case you missed it, here is THE GOLDEN NUGGET: When it comes to money, the only thing you have to fear is having no liquid cash to get you through an economic crisis.

It is a great time to buy property, but there are many people who have too much of their money tied up in non-liquid investments. They are worth lots of money on paper, but can hardly pay their bills. And there are those who have lost a lot of their money invested in semi-liquid investments like the stock market and have little liquid cash that they could get their hands on within 30 minutes if an emergency presented itself. The frightening shape our current economy is in today has the same indicators that heralded the depression of the 1930′s. Not enough cash savings, too much corporate and personal credit debt, banks failing and having to be bailed out  and the mortgage crisis / real estate crash.

What should you be doing? My clients are getting rid of their credit debt and stashing liquid cash like crazy. They are sleeping well at night and will make it through whatever comes. As martin Weiss recommends, they are “protecting their cash like a junk yard dog.” Does that mean you should sit on your cash and do nothing to recover the losses you may have sustained? Absolutely not!

I highly recommend you buy and read Martin Weiss’ book:

The Ultimate Depression Survival Guide: Protect Your Savings, Boost Your Income, and Grow Wealthy Even in the Worst of Times
 

The Ultimate Depression Survival Guide

Find out how safe your bank is.

Learn where and how to buy gold and silver, and why you should.

Discover which small companies Martin thinks are the best to invest in and what price you should pay.

Get his book today and look to the future with confidence that you can weather the storm.

What are you doing to protect yourself in the economic recession / depression that is already underway? Leave a comment.