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Saturday, December 17, 2011
Friday, November 11, 2011
Strategies to Survive the Stock Market Crash
After all of the bad news on increased volatility of the stock market and Europe's financial problems in these past few weeks, can we look forward to a brighter future? We can, and we most certainly will. So how exactly do we ride on the see-sawing stock market? Here are 5 simple strategies that will help investors in the upcoming weeks.
1) Continue to Invest. Over time, stock prices will become less volatile and more valuable. Despite the market's recent ups and downs, the Dow Jones Industrial Average increased by 1010.37 points over the last 3 months, which goes to show that the American economy is moving in a positive trend. America and the rest of the world weathered the brutal financial crisis in 2007; now is not the time to panic and sell your investments.
2) Sell Gold, and Then Buy Gold. This may be a silly idea to some, but investors will reap the rewards. Gold prices have approached all-time highs, and with Europe's problems, gold prices will decrease, and thus, now is the time to sell gold. When gold prices fall, buy gold again, because gold always has the natural tendency to increase in value over a long period of time because it's a highly-valued precious metal.
3) Invest in Large, Global Corporations. While the growth of small businesses is encouraging for the common man in America, large corporations with offices around the globe are staying for the long haul, and therefore investing here would be a wise move.
4) Sell European Investments NOW! With all of the financial troubles in Greece, Italy, Ireland, Portugal, and Spain, the Eurozone is currently a huge mess. Cash out now before it's too late, because bailing out half of Europe will be nearly impossible. Also, try to avoid buying stocks of companies that are directly tied to Europe. For example, Ford Motor Company's car sales in Europe will rapidly decline amidst the crisis, and thus, Ford's profits in the next quarter will be much lower than expected.
5) Invest in Dividend-Paying Stocks. Companies with divident-paying stocks in the stock market are usually financially secure. Also, who wouldn't want to share some of the companies profit's with other shareholders?
1) Continue to Invest. Over time, stock prices will become less volatile and more valuable. Despite the market's recent ups and downs, the Dow Jones Industrial Average increased by 1010.37 points over the last 3 months, which goes to show that the American economy is moving in a positive trend. America and the rest of the world weathered the brutal financial crisis in 2007; now is not the time to panic and sell your investments.
2) Sell Gold, and Then Buy Gold. This may be a silly idea to some, but investors will reap the rewards. Gold prices have approached all-time highs, and with Europe's problems, gold prices will decrease, and thus, now is the time to sell gold. When gold prices fall, buy gold again, because gold always has the natural tendency to increase in value over a long period of time because it's a highly-valued precious metal.
3) Invest in Large, Global Corporations. While the growth of small businesses is encouraging for the common man in America, large corporations with offices around the globe are staying for the long haul, and therefore investing here would be a wise move.
4) Sell European Investments NOW! With all of the financial troubles in Greece, Italy, Ireland, Portugal, and Spain, the Eurozone is currently a huge mess. Cash out now before it's too late, because bailing out half of Europe will be nearly impossible. Also, try to avoid buying stocks of companies that are directly tied to Europe. For example, Ford Motor Company's car sales in Europe will rapidly decline amidst the crisis, and thus, Ford's profits in the next quarter will be much lower than expected.
5) Invest in Dividend-Paying Stocks. Companies with divident-paying stocks in the stock market are usually financially secure. Also, who wouldn't want to share some of the companies profit's with other shareholders?
Wednesday, July 13, 2011
Analyzing Bernanke's Report to Congress
Ben Bernanke, the Chairman of the Federal Reserve, gave his semi-annual address to Congress about the economy and the financial state of America. One of the key points was that the Federal Reserve would be ready and prepared to encourage another economic stimulus if the economy remains stagnant. This assurance gave the economic markets more stability and growth. But what does that mean in the long run? Does that imply that financial institutions have the right to make riskier investments, because now they know they will be bailed out? One thing is certain, and that is that Bernanke's address significantly helped the gains in the Stock Market, with triple digit gains on the Dow Jones today.
Tuesday, July 12, 2011
Writing a Successful Business Plan
Whether you are planning to start a brand-new business, expand an existing company, or get financing for a business venture, you will need to write a business plan. A business plan not only lends your business a sense of credibility, but also helps you to cover all your bases, increasing your chances of success.
Although writing a business plan can be a lengthy, intimidating project, it is not necessarily difficult. Here is an overview of how to write a successful business plan.
What to Include in Your Business Plan
Your business plan needs to demonstrate that you have thoroughly considered all aspects of running your business. To that end, the standard business plan has nine major sections, covering everything from your business’s mission statement to a detailed financial analysis.
Executive Summary
The first – and most important – section of your business plan is the executive summary. This section is so important that it should literally be the first thing the reader sees – even before the table of contents! However, it should also be written last, as you’ll have a better understanding of the overall message of your business plan after you’ve researched and written the other sections.
One of the most important parts of the executive summary is the mission statement. The mission statement is only three or four sentences long, but it should pack the most punch out of everything else in your business plan: Those four sentences are responsible for not only defining your business, but also capturing the interest of your reader.
The rest of your executive summary should fill in the important details that the mission statement glosses over. For instance, your executive summary should include a short history of the business, including founder profiles and start date; a current snapshot, listing locations, numbers of employees, and products or services offered; and a summary of future plans and goals.
This section is a candidate for a bulleted format, which allows you to list main points in a manner that is easy to scan. Avoid using too much detail – remember, this section is a summary. A page or two is usually sufficient for an executive summary.
Market Analysis
The next section of your business plan focuses on market analysis. In order to show that your business has a reasonable chance for success, you will need to thoroughly research the industry and the market you intend to sell to. No bank or investor is going to back a doomed venture, so this section is sure to fall under especially close scrutiny if you are looking for financing.
Your market analysis should describe your industry, including the size, growth rate, and trends that could affect the industry. This section should also describe your target market – that is, the type or group of customers that your company intends to serve. The description of your target market should include detail such as:
• Distinguishing characteristics
• The needs your company or product line will meet
• What media and/or marketing methods you’ll use to reach them
• What percentage of your target market you expect to be able to wrest away from your competitors
In addition, your market analysis should include the results of any market tests you have done, and an analysis of the strengths and weaknesses of your competitors.
Company Description
After your market analysis, your business plan will need to include a description of your company. This section should describe:
• The nature of your business
• The needs of the market
• How your business will meet these needs
• Your target market, including specific individuals and/or organizations
• The factors that set you apart from your competition and make you likely to succeed
Although some of these things overlap with the previous section, they are still necessary parts of your company description. Each section of your business plan should have the ability to stand on its own if need be. In other words, the company description should thoroughly describe your company, even if certain aspects are covered in other sections.
Organization and Management
Once you have described the nature and purpose of your company, you will need to explain your staff setup. This section should include:
• The division of labor – how company processes are divided among the staff
• The management hierarchy
• Profiles of the company’s owner(s), management personnel, and the Board of Directors
• Employee incentives, such as salary, benefits packages, and bonuses
This goal of this section is to demonstrate not only good organization within the company, but also the ability to create loyalty in your employees. Long-term employees minimize human resource costs and increase a business’s chances for success, so banks and investors will want to see that you have an effective system in place for maintaining your staff.
Marketing and Sales Management
The purpose of the marketing and sales section of your business plan is to outline your strategies for marketing your products or services. This section also plans for company growth by describing how the growth could take place.
The section should describe your company’s:
• Marketing methods
• Distributions methods
• Type of sales force
• Sales activities
• Growth strategies
Product and Services
Following the marketing section of your business plan, you will need a section focusing on the product or services your business offers. This is more than a simple description of your product or services, though. You will also need to include:
• The specific benefits your product or service offers customers
• The specific needs of the market, and how your product will meet them
• The advantages your product has over your competitors
• Any copyright, trade secret, or patent information pertaining to your product
• Where any new products or services are in the research and development process
• Current industry research that you could use in the development of products and services
Funding Request
Only once you have described your business from head to toe are you ready to detail your funding needs. This section should include everything a bank or investor needs in order to understand what type of funding you want:
• How much money you need now
• How much money you think you will need over the next five years
• How the money you borrow will be used
• How long you will need funding
• What type of funding you want (i.e. loans, investors, etc.)
• Any other terms you want the funding arrangement to include
Financial Information
The financials section in your business plan supports your request for outside funding. This section provides an analysis of your company’s prospective financial success. The section also details your company’s financial track record for the past three to five years, unless you are seeking financing for a startup business.
The financials section should include:
• Company income statements for prior years
• Balance sheets for prior years
• Cash flow statements for prior years
• Forecasted company income statements
• Forecasted balance sheets
• Forecasted cash flow statements
• Projections for the next five years – every month or quarter for the first year, with longer intervals for the remaining years
• Collateral you can use to secure a loan
The financials section is a great place to include visuals such as graphs, particularly if you predict a positive trend in your projected financials.
I hope this section was informative and gave a descriptive overview on how to write a successful business plan.
Although writing a business plan can be a lengthy, intimidating project, it is not necessarily difficult. Here is an overview of how to write a successful business plan.
What to Include in Your Business Plan
Your business plan needs to demonstrate that you have thoroughly considered all aspects of running your business. To that end, the standard business plan has nine major sections, covering everything from your business’s mission statement to a detailed financial analysis.
Executive Summary
The first – and most important – section of your business plan is the executive summary. This section is so important that it should literally be the first thing the reader sees – even before the table of contents! However, it should also be written last, as you’ll have a better understanding of the overall message of your business plan after you’ve researched and written the other sections.
One of the most important parts of the executive summary is the mission statement. The mission statement is only three or four sentences long, but it should pack the most punch out of everything else in your business plan: Those four sentences are responsible for not only defining your business, but also capturing the interest of your reader.
The rest of your executive summary should fill in the important details that the mission statement glosses over. For instance, your executive summary should include a short history of the business, including founder profiles and start date; a current snapshot, listing locations, numbers of employees, and products or services offered; and a summary of future plans and goals.
This section is a candidate for a bulleted format, which allows you to list main points in a manner that is easy to scan. Avoid using too much detail – remember, this section is a summary. A page or two is usually sufficient for an executive summary.
Market Analysis
The next section of your business plan focuses on market analysis. In order to show that your business has a reasonable chance for success, you will need to thoroughly research the industry and the market you intend to sell to. No bank or investor is going to back a doomed venture, so this section is sure to fall under especially close scrutiny if you are looking for financing.
Your market analysis should describe your industry, including the size, growth rate, and trends that could affect the industry. This section should also describe your target market – that is, the type or group of customers that your company intends to serve. The description of your target market should include detail such as:
• Distinguishing characteristics
• The needs your company or product line will meet
• What media and/or marketing methods you’ll use to reach them
• What percentage of your target market you expect to be able to wrest away from your competitors
In addition, your market analysis should include the results of any market tests you have done, and an analysis of the strengths and weaknesses of your competitors.
Company Description
After your market analysis, your business plan will need to include a description of your company. This section should describe:
• The nature of your business
• The needs of the market
• How your business will meet these needs
• Your target market, including specific individuals and/or organizations
• The factors that set you apart from your competition and make you likely to succeed
Although some of these things overlap with the previous section, they are still necessary parts of your company description. Each section of your business plan should have the ability to stand on its own if need be. In other words, the company description should thoroughly describe your company, even if certain aspects are covered in other sections.
Organization and Management
Once you have described the nature and purpose of your company, you will need to explain your staff setup. This section should include:
• The division of labor – how company processes are divided among the staff
• The management hierarchy
• Profiles of the company’s owner(s), management personnel, and the Board of Directors
• Employee incentives, such as salary, benefits packages, and bonuses
This goal of this section is to demonstrate not only good organization within the company, but also the ability to create loyalty in your employees. Long-term employees minimize human resource costs and increase a business’s chances for success, so banks and investors will want to see that you have an effective system in place for maintaining your staff.
Marketing and Sales Management
The purpose of the marketing and sales section of your business plan is to outline your strategies for marketing your products or services. This section also plans for company growth by describing how the growth could take place.
The section should describe your company’s:
• Marketing methods
• Distributions methods
• Type of sales force
• Sales activities
• Growth strategies
Product and Services
Following the marketing section of your business plan, you will need a section focusing on the product or services your business offers. This is more than a simple description of your product or services, though. You will also need to include:
• The specific benefits your product or service offers customers
• The specific needs of the market, and how your product will meet them
• The advantages your product has over your competitors
• Any copyright, trade secret, or patent information pertaining to your product
• Where any new products or services are in the research and development process
• Current industry research that you could use in the development of products and services
Funding Request
Only once you have described your business from head to toe are you ready to detail your funding needs. This section should include everything a bank or investor needs in order to understand what type of funding you want:
• How much money you need now
• How much money you think you will need over the next five years
• How the money you borrow will be used
• How long you will need funding
• What type of funding you want (i.e. loans, investors, etc.)
• Any other terms you want the funding arrangement to include
Financial Information
The financials section in your business plan supports your request for outside funding. This section provides an analysis of your company’s prospective financial success. The section also details your company’s financial track record for the past three to five years, unless you are seeking financing for a startup business.
The financials section should include:
• Company income statements for prior years
• Balance sheets for prior years
• Cash flow statements for prior years
• Forecasted company income statements
• Forecasted balance sheets
• Forecasted cash flow statements
• Projections for the next five years – every month or quarter for the first year, with longer intervals for the remaining years
• Collateral you can use to secure a loan
The financials section is a great place to include visuals such as graphs, particularly if you predict a positive trend in your projected financials.
I hope this section was informative and gave a descriptive overview on how to write a successful business plan.
Is the American Dream Falling Apart?
The movie, Inside Job, was brilliantly directed by Charles Ferguson. This truthful documentary accurately portrays the greediness and selfishness of the Wall Street executives. With lively interviews and the gripping storyline, the movie shows why the economy came to a sudden crash. While an economic recession is occurring since the early 2000's, Wall Street executives and greedy investment banks continue to reap the rewards by earning billions of dollars. While knowing the growing problem, unwise investors continued to pour money into the housing bubble and accumulate vast amounts of debt. With so much credit available and so much money circulating, a recession was bound to happen. Don't be afraid to watch Inside Job, because it just may save your way of life in the near future. I would highly recommend everyone to watch this extraordinary film.
Welcome
Welcome to my blog! I hope you enjoy the many pleasures and knowledge gained from this important blog about the financial world. This blog will mainly cover the key ideas and strategies in investments, finance, and technology. Enjoy!!
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