When you hear the word 'Barter' do you instinctively think of two farmers trading a horse for a cow, or the likes of latter-day trappers carrying furs to a trading post to exchange them for food and provisions, or like millions of savvy business owners around the globe, do you think of a high-tech way of marketing your goods and services beyond your usual scope, and becoming more efficient in the process?
It's strange that during my entire business education at university (and I was fortunate enough to be educated in some of the best business establishments in London, Munich and Florence)not once did the word nor concept of barter ever surface - even in economics. Strange, don't you think, when barter was the foundation of all modern commerce?
So, how has barter stayed the 'best kept marketing secret in business'? Simple, it has never been perfected on a larger scale until recently with the advancement of computers. Globally barter accounts for almost $1 trillion in annual business. Little 'mom and pop' stores all the way up to Super Power governments barter, some with more success than others. Most recently, in fact, the entire country of Argentina had to utilize the incredible power of barter to pull itself out of bankruptcy, and today over 500,000 companies barter there on a regular basis.
Bartering is a very simple concept: it is the exchange of goods and services for other goods and services. In an ironic manner, workers all over the world barter their time and skills for a salary. As a child, you possibly traded playing cards. It's all the same concept. BUT, how is this an effective advertising/ marketing tool?
Reciprocal trading, whereby two businesses directly trade with one another (radio advertising for airline tickets, for example) is not as effective as trades that occur through barter exchanges and often create less publicity and marketing opportunities. Utilizing an ethical and trustworthy barter exchange on the other hand can be a very effective means of bartering.
There are more than 1400 barter companies in the US alone, varying wildly in size and scope, and therefore in effectiveness. The two major players in the national barter arena are ITEX (a consortium of smaller barter companies) and Merchants Barter Exchange (one of the only 'true' 100% bartering companies in the US). Both companies offer many benefits, some of which are:
+ Greater efficiency (better use of time or inventory)
+ Increase in customers
+ Improved purchasing power
+ Cost-effective exposure to national markets
+ Measurable ROI
+ Word of Mouth Advertising
Since only businesses can be members of barter companies, there is a huge propensity to generate new cash clients that are not business owners. Outside of effective networking groups, like Business Networks International (BNI), barter exchanges are the most effective tool to generate word of mouth advertising and track it.
Barter companies like ITEX (www.itex.com) and Merchants Barter Exchange (www.merchantsbarter.com) act as 'third party record keepers' - similar to credit card companies - brokering and tracking the trades between members. In essence each member has a bartering account - just like their bank account - and are allotted barter credits (usually the same value as the currency of the country - but make sure to check before joining, as some exchanges have inflated economies!). Members purchase things they need - printing, cars, advertising, etc. - with credits in their account, similar to writing an IOU, and owe back the amount of those goods and services with their surplus inventory or down time.
Membership fees for such exchanges are very affordable compared with other forms of advertising, usually much less than $1,000 for a one-time set-up charge, and broker commissions are usually levied on purchases only (generally 10% of the total trade). Again, be warned when checking out bona fide companies, as some charge a lower fee, BUT on both the sale and purchase of goods and services.
Barter: The Oldest and Most Effective Marketing Tool - So Simple, The Cavemen Invented It...!
Saturday, February 28, 2009
To Barter or Not To Barter
Elsewhere in the world, bartering is as commonplace as accepting credit cards, and an integral element to almost every business model. Here in the US, predominantly due to the fact we have been the strongest and most affluent global economy for so long, barter was never a necessity. Until now, that is. With the current collapse of the monetary infrastructure here in America and around the world, increasing numbers of people are flocking to the age-old system of bartering. At the turn of the new millennium, countries like Argentina, who were on the brink of bankruptcy, were forced to revert back to bartering in order to ‘reboot’ their cash economy. Employers were forced to pay their workers with products instead of money, which they then took to large, communal warehouses and bartered their wares with other workers. Hopefully this will not be the plight of the US, and this article aims to highlight some solutions that are already in place and are laying the foundations for a working alternative economy.
Bartering in its simplest definition is the exchange of goods and services for other goods and services without the need for cash. It makes sound economic sense, because a business owner can trade out things at their wholesale (their cost of goods) for things they would have to pay the full cash price for otherwise. If you are a restaurant owner, why wouldn’t you trade $100 worth of gift certificates with the company that does your pest control each month? Or if you own a repair garage, if you can get uniforms for your mechanics and trade out oil changes and services, you’d be daft not to. The benefits are not just improved cash flow and better efficiencies, it’s also a great way to get new customers. Many people are told during their occupational schooling - especially Chiropractors and massage therapists - to barter for many of their start-up needs to conserve their seed capital, because their cost of goods is so much lower than the retail cash price.
But how do you find other business owners to barter with you, or what if you want their stuff and they don’t want yours? Even though bartering makes perfect sense to any business, the simple fact is that most owners don’t have the time or resources to call twenty or more companies to find a partner to trade with, and when profits are up, it’s faster and more convenient just to pay cash. Barter for the most part just happens by accident; two owners meet, they start talking, and decide to swap – much like you might have traded baseball cards in the school yard as a kid. Organized barter companies arose in the mid-50s to address just this problem.
In the early days, the technology to work a little barter company was simple: a phone and a rolodex. As time passed and technology improved, slightly more advanced barter organizations emerged, but merely adapted a similar system of a printed member list and put the bulk of the trading upon the members. By default of this system being cumbersome, organized barter never seemed to get past second base, especially with the advent of payment by charge and credit cards. In America today there are over 1,000 barter companies of varying sizes, from small local collectives of less than 50 members, to national corporations like ITEX and Merchants Barter Exchange (MBE). Non-profit organziations like IRTA (International Reciprocal Trade Association) and NATE (National Association of Trade Exchanges) have attempted to consolidate and uniform bartering via small exchanges, but due to the fact that each barter company does things in slightly different ways with different fees, and most accepting cash as part of the payment it is not a perfect system to manage.
To date, the only national barter company to totally reinvent organized barter is Merchants Barter Exchange. Because they do things so differently to all the other exchanges out there, they do not belong to either IRTA or NATE, as MBE does not allow its members to inflate prices, nor do they allow any part of the exchange to be paid in cash, which makes them the only ‘true’ barter company in the US today. In fact, MBE has made bartering similar to spending cash within a private bank or economy, which accounts for their incredible growth since their inception in 2000.
The downward economy and the improvements in technology have given rise to many ‘me-too’ barter firms that are solely internet-based looking to cash in on this lucrative industry. A quick Google search will bring up a torrent of ‘new age’ online barter clubs. On closer examination, be wary of the jumble in the internet jungle. Start-up costs for an online ‘portal’ – as most of the online-only barter clubs are – are much lower than a bricks-and-mortar barter company and the majority are merely a swap-exchange. A serious business owner needs to look towards a business-focused barter company that has new, rather than used, goods, and services that are suitable to his business.
Other important factors to consider when scouting a good barter company are the membership fees. If a barter exchange does not charge fees, chances are they are not worth joining. Any business service that has benefits to membership should feel totally justified charging a sign-up fee and fees for using the system. Usually it is the brand new start-up exchanges that have to waive initiation fees because they have no members, or the older barter companies that cannot iron out the flaws of inflated pricing and cash-barter blends.
Obviously, back in the 50s when organized bartering began, Uncle Sam wasn’t too concerned with barter, but obviously where there is money to be made, the IRS eventually get interested and wants its share. So too with the barter industry. Back in 1982, Congress passed the barter tax compliance provisions in the Tax Equity and Fiscal Responsibility Act. This landmark legislation acknowledged and equated barter exchanges with banks and credit card companies as “third party record keepers” of the financial records of other taxpayers. The IRS considers all forms of barter – whether direct or via a barter exchange – just the same as cash transactions, and all barter companies have to issue 1099b forms at the end of each tax year to members for accounting purposes.
Like any business decision, choosing the right barter company for you should be made carefully. Most good barter exchanges have active outside sales representatives that are qualified to answer most questions a business owner has. Consider the fees to join, the availability of goods and services, most importantly today, with increased competition and shrinking market share, make sure the exchange does not list you on an open directory so that your existing cash business is protected (there is nothing worse than having your top five cash-paying clients join the same barter group as you because they saw you on the list and then you lose that cash income!) There are pros and cons to privately owned and publicly traded companies too, obviously a privately owned exchange is not effected by the stock market fluctuations and less likely to go under.
Again, these are very tough and challenging times for all of us, business owners and employees alike. Barter as an economic vehicle has most certainly stood the test of time and will be around for many more millennia. Done right, barter can be an incredible boost to any business.
Shawn Cressman owns the Lehigh Valley, PA, license for MBE
Bartering in its simplest definition is the exchange of goods and services for other goods and services without the need for cash. It makes sound economic sense, because a business owner can trade out things at their wholesale (their cost of goods) for things they would have to pay the full cash price for otherwise. If you are a restaurant owner, why wouldn’t you trade $100 worth of gift certificates with the company that does your pest control each month? Or if you own a repair garage, if you can get uniforms for your mechanics and trade out oil changes and services, you’d be daft not to. The benefits are not just improved cash flow and better efficiencies, it’s also a great way to get new customers. Many people are told during their occupational schooling - especially Chiropractors and massage therapists - to barter for many of their start-up needs to conserve their seed capital, because their cost of goods is so much lower than the retail cash price.
But how do you find other business owners to barter with you, or what if you want their stuff and they don’t want yours? Even though bartering makes perfect sense to any business, the simple fact is that most owners don’t have the time or resources to call twenty or more companies to find a partner to trade with, and when profits are up, it’s faster and more convenient just to pay cash. Barter for the most part just happens by accident; two owners meet, they start talking, and decide to swap – much like you might have traded baseball cards in the school yard as a kid. Organized barter companies arose in the mid-50s to address just this problem.
In the early days, the technology to work a little barter company was simple: a phone and a rolodex. As time passed and technology improved, slightly more advanced barter organizations emerged, but merely adapted a similar system of a printed member list and put the bulk of the trading upon the members. By default of this system being cumbersome, organized barter never seemed to get past second base, especially with the advent of payment by charge and credit cards. In America today there are over 1,000 barter companies of varying sizes, from small local collectives of less than 50 members, to national corporations like ITEX and Merchants Barter Exchange (MBE). Non-profit organziations like IRTA (International Reciprocal Trade Association) and NATE (National Association of Trade Exchanges) have attempted to consolidate and uniform bartering via small exchanges, but due to the fact that each barter company does things in slightly different ways with different fees, and most accepting cash as part of the payment it is not a perfect system to manage.
To date, the only national barter company to totally reinvent organized barter is Merchants Barter Exchange. Because they do things so differently to all the other exchanges out there, they do not belong to either IRTA or NATE, as MBE does not allow its members to inflate prices, nor do they allow any part of the exchange to be paid in cash, which makes them the only ‘true’ barter company in the US today. In fact, MBE has made bartering similar to spending cash within a private bank or economy, which accounts for their incredible growth since their inception in 2000.
The downward economy and the improvements in technology have given rise to many ‘me-too’ barter firms that are solely internet-based looking to cash in on this lucrative industry. A quick Google search will bring up a torrent of ‘new age’ online barter clubs. On closer examination, be wary of the jumble in the internet jungle. Start-up costs for an online ‘portal’ – as most of the online-only barter clubs are – are much lower than a bricks-and-mortar barter company and the majority are merely a swap-exchange. A serious business owner needs to look towards a business-focused barter company that has new, rather than used, goods, and services that are suitable to his business.
Other important factors to consider when scouting a good barter company are the membership fees. If a barter exchange does not charge fees, chances are they are not worth joining. Any business service that has benefits to membership should feel totally justified charging a sign-up fee and fees for using the system. Usually it is the brand new start-up exchanges that have to waive initiation fees because they have no members, or the older barter companies that cannot iron out the flaws of inflated pricing and cash-barter blends.
Obviously, back in the 50s when organized bartering began, Uncle Sam wasn’t too concerned with barter, but obviously where there is money to be made, the IRS eventually get interested and wants its share. So too with the barter industry. Back in 1982, Congress passed the barter tax compliance provisions in the Tax Equity and Fiscal Responsibility Act. This landmark legislation acknowledged and equated barter exchanges with banks and credit card companies as “third party record keepers” of the financial records of other taxpayers. The IRS considers all forms of barter – whether direct or via a barter exchange – just the same as cash transactions, and all barter companies have to issue 1099b forms at the end of each tax year to members for accounting purposes.
Like any business decision, choosing the right barter company for you should be made carefully. Most good barter exchanges have active outside sales representatives that are qualified to answer most questions a business owner has. Consider the fees to join, the availability of goods and services, most importantly today, with increased competition and shrinking market share, make sure the exchange does not list you on an open directory so that your existing cash business is protected (there is nothing worse than having your top five cash-paying clients join the same barter group as you because they saw you on the list and then you lose that cash income!) There are pros and cons to privately owned and publicly traded companies too, obviously a privately owned exchange is not effected by the stock market fluctuations and less likely to go under.
Again, these are very tough and challenging times for all of us, business owners and employees alike. Barter as an economic vehicle has most certainly stood the test of time and will be around for many more millennia. Done right, barter can be an incredible boost to any business.
Shawn Cressman owns the Lehigh Valley, PA, license for MBE
To Barter or Not To Barter
Elsewhere in the world, bartering is as commonplace as accepting credit cards, and an integral element to almost every business model. Here in the US, predominantly due to the fact we have been the strongest and most affluent global economy for so long, barter was never a necessity. Until now, that is. With the current collapse of the monetary infrastructure here in America and around the world, increasing numbers of people are flocking to the age-old system of bartering. At the turn of the new millennium, countries like Argentina, who were on the brink of bankruptcy, were forced to revert back to bartering in order to ‘reboot’ their cash economy. Employers were forced to pay their workers with products instead of money, which they then took to large, communal warehouses and bartered their wares with other workers. Hopefully this will not be the plight of the US, and this article aims to highlight some solutions that are already in place and are laying the foundations for a working alternative economy.
Bartering in its simplest definition is the exchange of goods and services for other goods and services without the need for cash. It makes sound economic sense, because a business owner can trade out things at their wholesale (their cost of goods) for things they would have to pay the full cash price for otherwise. If you are a restaurant owner, why wouldn’t you trade $100 worth of gift certificates with the company that does your pest control each month? Or if you own a repair garage, if you can get uniforms for your mechanics and trade out oil changes and services, you’d be daft not to. The benefits are not just improved cash flow and better efficiencies, it’s also a great way to get new customers. Many people are told during their occupational schooling - especially Chiropractors and massage therapists - to barter for many of their start-up needs to conserve their seed capital, because their cost of goods is so much lower than the retail cash price.
But how do you find other business owners to barter with you, or what if you want their stuff and they don’t want yours? Even though bartering makes perfect sense to any business, the simple fact is that most owners don’t have the time or resources to call twenty or more companies to find a partner to trade with, and when profits are up, it’s faster and more convenient just to pay cash. Barter for the most part just happens by accident; two owners meet, they start talking, and decide to swap – much like you might have traded baseball cards in the school yard as a kid. Organized barter companies arose in the mid-50s to address just this problem.
In the early days, the technology to work a little barter company was simple: a phone and a rolodex. As time passed and technology improved, slightly more advanced barter organizations emerged, but merely adapted a similar system of a printed member list and put the bulk of the trading upon the members. By default of this system being cumbersome, organized barter never seemed to get past second base, especially with the advent of payment by charge and credit cards. In America today there are over 1,000 barter companies of varying sizes, from small local collectives of less than 50 members, to national corporations like ITEX and Merchants Barter Exchange (MBE). Non-profit organziations like IRTA (International Reciprocal Trade Association) and NATE (National Association of Trade Exchanges) have attempted to consolidate and uniform bartering via small exchanges, but due to the fact that each barter company does things in slightly different ways with different fees, and most accepting cash as part of the payment it is not a perfect system to manage.
To date, the only national barter company to totally reinvent organized barter is Merchants Barter Exchange. Because they do things so differently to all the other exchanges out there, they do not belong to either IRTA or NATE, as MBE does not allow its members to inflate prices, nor do they allow any part of the exchange to be paid in cash, which makes them the only ‘true’ barter company in the US today. In fact, MBE has made bartering similar to spending cash within a private bank or economy, which accounts for their incredible growth since their inception in 2000.
The downward economy and the improvements in technology have given rise to many ‘me-too’ barter firms that are solely internet-based looking to cash in on this lucrative industry. A quick Google search will bring up a torrent of ‘new age’ online barter clubs. On closer examination, be wary of the jumble in the internet jungle. Start-up costs for an online ‘portal’ – as most of the online-only barter clubs are – are much lower than a bricks-and-mortar barter company and the majority are merely a swap-exchange. A serious business owner needs to look towards a business-focused barter company that has new, rather than used, goods, and services that are suitable to his business.
Other important factors to consider when scouting a good barter company are the membership fees. If a barter exchange does not charge fees, chances are they are not worth joining. Any business service that has benefits to membership should feel totally justified charging a sign-up fee and fees for using the system. Usually it is the brand new start-up exchanges that have to waive initiation fees because they have no members, or the older barter companies that cannot iron out the flaws of inflated pricing and cash-barter blends.
Obviously, back in the 50s when organized bartering began, Uncle Sam wasn’t too concerned with barter, but obviously where there is money to be made, the IRS eventually get interested and wants its share. So too with the barter industry. Back in 1982, Congress passed the barter tax compliance provisions in the Tax Equity and Fiscal Responsibility Act. This landmark legislation acknowledged and equated barter exchanges with banks and credit card companies as “third party record keepers” of the financial records of other taxpayers. The IRS considers all forms of barter – whether direct or via a barter exchange – just the same as cash transactions, and all barter companies have to issue 1099b forms at the end of each tax year to members for accounting purposes.
Like any business decision, choosing the right barter company for you should be made carefully. Most good barter exchanges have active outside sales representatives that are qualified to answer most questions a business owner has. Consider the fees to join, the availability of goods and services, most importantly today, with increased competition and shrinking market share, make sure the exchange does not list you on an open directory so that your existing cash business is protected (there is nothing worse than having your top five cash-paying clients join the same barter group as you because they saw you on the list and then you lose that cash income!) There are pros and cons to privately owned and publicly traded companies too, obviously a privately owned exchange is not effected by the stock market fluctuations and less likely to go under.
Again, these are very tough and challenging times for all of us, business owners and employees alike. Barter as an economic vehicle has most certainly stood the test of time and will be around for many more millennia. Done right, barter can be an incredible boost to any business.
Shawn Cressman owns the Lehigh Valley, PA, license for MBE
Bartering in its simplest definition is the exchange of goods and services for other goods and services without the need for cash. It makes sound economic sense, because a business owner can trade out things at their wholesale (their cost of goods) for things they would have to pay the full cash price for otherwise. If you are a restaurant owner, why wouldn’t you trade $100 worth of gift certificates with the company that does your pest control each month? Or if you own a repair garage, if you can get uniforms for your mechanics and trade out oil changes and services, you’d be daft not to. The benefits are not just improved cash flow and better efficiencies, it’s also a great way to get new customers. Many people are told during their occupational schooling - especially Chiropractors and massage therapists - to barter for many of their start-up needs to conserve their seed capital, because their cost of goods is so much lower than the retail cash price.
But how do you find other business owners to barter with you, or what if you want their stuff and they don’t want yours? Even though bartering makes perfect sense to any business, the simple fact is that most owners don’t have the time or resources to call twenty or more companies to find a partner to trade with, and when profits are up, it’s faster and more convenient just to pay cash. Barter for the most part just happens by accident; two owners meet, they start talking, and decide to swap – much like you might have traded baseball cards in the school yard as a kid. Organized barter companies arose in the mid-50s to address just this problem.
In the early days, the technology to work a little barter company was simple: a phone and a rolodex. As time passed and technology improved, slightly more advanced barter organizations emerged, but merely adapted a similar system of a printed member list and put the bulk of the trading upon the members. By default of this system being cumbersome, organized barter never seemed to get past second base, especially with the advent of payment by charge and credit cards. In America today there are over 1,000 barter companies of varying sizes, from small local collectives of less than 50 members, to national corporations like ITEX and Merchants Barter Exchange (MBE). Non-profit organziations like IRTA (International Reciprocal Trade Association) and NATE (National Association of Trade Exchanges) have attempted to consolidate and uniform bartering via small exchanges, but due to the fact that each barter company does things in slightly different ways with different fees, and most accepting cash as part of the payment it is not a perfect system to manage.
To date, the only national barter company to totally reinvent organized barter is Merchants Barter Exchange. Because they do things so differently to all the other exchanges out there, they do not belong to either IRTA or NATE, as MBE does not allow its members to inflate prices, nor do they allow any part of the exchange to be paid in cash, which makes them the only ‘true’ barter company in the US today. In fact, MBE has made bartering similar to spending cash within a private bank or economy, which accounts for their incredible growth since their inception in 2000.
The downward economy and the improvements in technology have given rise to many ‘me-too’ barter firms that are solely internet-based looking to cash in on this lucrative industry. A quick Google search will bring up a torrent of ‘new age’ online barter clubs. On closer examination, be wary of the jumble in the internet jungle. Start-up costs for an online ‘portal’ – as most of the online-only barter clubs are – are much lower than a bricks-and-mortar barter company and the majority are merely a swap-exchange. A serious business owner needs to look towards a business-focused barter company that has new, rather than used, goods, and services that are suitable to his business.
Other important factors to consider when scouting a good barter company are the membership fees. If a barter exchange does not charge fees, chances are they are not worth joining. Any business service that has benefits to membership should feel totally justified charging a sign-up fee and fees for using the system. Usually it is the brand new start-up exchanges that have to waive initiation fees because they have no members, or the older barter companies that cannot iron out the flaws of inflated pricing and cash-barter blends.
Obviously, back in the 50s when organized bartering began, Uncle Sam wasn’t too concerned with barter, but obviously where there is money to be made, the IRS eventually get interested and wants its share. So too with the barter industry. Back in 1982, Congress passed the barter tax compliance provisions in the Tax Equity and Fiscal Responsibility Act. This landmark legislation acknowledged and equated barter exchanges with banks and credit card companies as “third party record keepers” of the financial records of other taxpayers. The IRS considers all forms of barter – whether direct or via a barter exchange – just the same as cash transactions, and all barter companies have to issue 1099b forms at the end of each tax year to members for accounting purposes.
Like any business decision, choosing the right barter company for you should be made carefully. Most good barter exchanges have active outside sales representatives that are qualified to answer most questions a business owner has. Consider the fees to join, the availability of goods and services, most importantly today, with increased competition and shrinking market share, make sure the exchange does not list you on an open directory so that your existing cash business is protected (there is nothing worse than having your top five cash-paying clients join the same barter group as you because they saw you on the list and then you lose that cash income!) There are pros and cons to privately owned and publicly traded companies too, obviously a privately owned exchange is not effected by the stock market fluctuations and less likely to go under.
Again, these are very tough and challenging times for all of us, business owners and employees alike. Barter as an economic vehicle has most certainly stood the test of time and will be around for many more millennia. Done right, barter can be an incredible boost to any business.
Shawn Cressman owns the Lehigh Valley, PA, license for MBE
Sunday, January 4, 2009
Obama Fans Now It's Really Time To Unite
Okay Obama fans, first the good news:
GOOD NEWS: you more than proved you can act as a united force to unify your support and get out and spread the word and vote. Look what happened, you helped make history. But the bad news...
BAD NEWS: that was the easy part!
I'm not really sure (and certainly if I were Obama, I'd not be relishing January 20th) he's still partying it up about the victory you led him to. Take a peek at the facts of what he's walking into:
THE FACTS:
1. We are faced with the biggest global economic catastrophe in history
2. The Feds don't seem to have any real solutions. "Let's cut the rate - again!" just won't cut it any more.
3. Bankruptcies are up 28% and still rising
4. Unemployment is at an all-time high - and I predict will definately hit 10%
5. Consumer confidence is down 40%
6. I'm not even going to mention the housing market!
Trust me, I'm an extremely optimistic person and always try to look on the bright side, but this is like standing on the high board of a pool without knowing how to swim looking down at a bunch of very hungry sharks! What really worries me is that most people don't seem to be as scared as me, or even scared at all. Am I hallucinating this impending depression, or is everybody else drinking some LSD-loaded KoolAid?
My business is barter, via my company Merchants Barter Exchange, and as such I deal with sales people and business owners all day long. Almost everybody is putting a 'brave face' on things. Believe me, Obama is not going to wave a magic wand on January 20th and make all these bad dreams go away! But there is some good news:
GOOD NEWS: if Obama and his supporters are prepared to put in the same (or more) effort it took to get him elected, we may be able to speed the recovery process. This isn't intended as a sales pitch, however I cannot help but be a little biased due to all the great work Merchants Barter Exchange has been doing for over eight years preparing and supporting businesses for just this situation.
YOU can help the problem by becoming part of the solution. Just getting out and voting was a good start, but that is all it was. If that is all your participation is going to be and you are going to flop back down on your 'welfare' or 'entitlement' couch and watch as everybody else does the work, then you really didn't do justice to the campaign you voted for.
OBAMA needed your help then and he needs it now and will continue to need it on a daily basis until we are out of this economic catastrophe. So, what can you do...? Well, for starters you can badger your politicians and get them to see that the stimulous package actual stimulates something useful. You can also spread the word (twitter, email, blog, call, whatever - do everything you can) to everybody and anybody that will listen - just like you did during the campaign - that we all need to work as a team. Tell your local business owners to call Merchants Barter Exchange to help them save cash on things they need. Tell local entrepreneurs about MBE and get them involved. Now more than ever before we need a strong, serious back-up economy.
2009 needs to see the power of the people stand behind Obama-nomics, and Obama-nomics has to include MBE-barter as part of his success strategy otherwise we are on a very slippery slope to a bottomless pit. As he says, "It's gonna get worse before it gets better." Be prepared for a tough battle, but the end result can be very positive.
Let's pull together as a nation and show the rest of the world where our true strength lies, in the UNITED States of the American People.
Thanks for reading, now get twittering... texting... emailing... and lay the foundations for Obama to make some serious progress in January 2009.
GOOD NEWS: you more than proved you can act as a united force to unify your support and get out and spread the word and vote. Look what happened, you helped make history. But the bad news...
BAD NEWS: that was the easy part!
I'm not really sure (and certainly if I were Obama, I'd not be relishing January 20th) he's still partying it up about the victory you led him to. Take a peek at the facts of what he's walking into:
THE FACTS:
1. We are faced with the biggest global economic catastrophe in history
2. The Feds don't seem to have any real solutions. "Let's cut the rate - again!" just won't cut it any more.
3. Bankruptcies are up 28% and still rising
4. Unemployment is at an all-time high - and I predict will definately hit 10%
5. Consumer confidence is down 40%
6. I'm not even going to mention the housing market!
Trust me, I'm an extremely optimistic person and always try to look on the bright side, but this is like standing on the high board of a pool without knowing how to swim looking down at a bunch of very hungry sharks! What really worries me is that most people don't seem to be as scared as me, or even scared at all. Am I hallucinating this impending depression, or is everybody else drinking some LSD-loaded KoolAid?
My business is barter, via my company Merchants Barter Exchange, and as such I deal with sales people and business owners all day long. Almost everybody is putting a 'brave face' on things. Believe me, Obama is not going to wave a magic wand on January 20th and make all these bad dreams go away! But there is some good news:
GOOD NEWS: if Obama and his supporters are prepared to put in the same (or more) effort it took to get him elected, we may be able to speed the recovery process. This isn't intended as a sales pitch, however I cannot help but be a little biased due to all the great work Merchants Barter Exchange has been doing for over eight years preparing and supporting businesses for just this situation.
YOU can help the problem by becoming part of the solution. Just getting out and voting was a good start, but that is all it was. If that is all your participation is going to be and you are going to flop back down on your 'welfare' or 'entitlement' couch and watch as everybody else does the work, then you really didn't do justice to the campaign you voted for.
OBAMA needed your help then and he needs it now and will continue to need it on a daily basis until we are out of this economic catastrophe. So, what can you do...? Well, for starters you can badger your politicians and get them to see that the stimulous package actual stimulates something useful. You can also spread the word (twitter, email, blog, call, whatever - do everything you can) to everybody and anybody that will listen - just like you did during the campaign - that we all need to work as a team. Tell your local business owners to call Merchants Barter Exchange to help them save cash on things they need. Tell local entrepreneurs about MBE and get them involved. Now more than ever before we need a strong, serious back-up economy.
2009 needs to see the power of the people stand behind Obama-nomics, and Obama-nomics has to include MBE-barter as part of his success strategy otherwise we are on a very slippery slope to a bottomless pit. As he says, "It's gonna get worse before it gets better." Be prepared for a tough battle, but the end result can be very positive.
Let's pull together as a nation and show the rest of the world where our true strength lies, in the UNITED States of the American People.
Thanks for reading, now get twittering... texting... emailing... and lay the foundations for Obama to make some serious progress in January 2009.
Thursday, January 1, 2009
Happy New Year????
Hopefully everyone out there is working out the cobwebs and defining their goals and purpose after an abysmal economic relapse. Before I stand on my soapbox and preach, I'd like to preface things with this... My motives and intents are pure. That being said, here we go. January 20th is quickly approaching and that takes on a historic, global magnitude. Anyone with a pulse clearly understands that their own personal and business security is being threatened. My company, Merchants Barter Exchange is the only company that is actively seeking out business owners and entrepreneurs to help weather the impending global economic collapse. Businesses that are SERIOUS about staying in business will have to incorporate MBE barter into their business plans or they will be history. My company has been supporting and preparing businesses nationally for the last eight years for this exact economic meltdown. We incubate businesses from what's unfolding in the economy around them by: helping them stop spending cash to get things they need and want, move surplus inventory, maximize capacity and acquire new business clients that normally they wouldn't have the reach to obtain.
The oldest form of commerce known to man will outlive any economic infrastructure for milennia. Folks, contrary to what some think, this alternative payment dynamic is far from a paradigm shift. Any business that is accepting credit cards or cash is bartering. This world more than ever needs a back up economy because what's in place clearly isn't. Mr. Obama MBE-Barter can help you make your term a success and you will go down in history as the most powerful and intelligent man ever. Help the world by incorporating MBE-barter into its economy.
The oldest form of commerce known to man will outlive any economic infrastructure for milennia. Folks, contrary to what some think, this alternative payment dynamic is far from a paradigm shift. Any business that is accepting credit cards or cash is bartering. This world more than ever needs a back up economy because what's in place clearly isn't. Mr. Obama MBE-Barter can help you make your term a success and you will go down in history as the most powerful and intelligent man ever. Help the world by incorporating MBE-barter into its economy.
Sunday, December 14, 2008
What Happens when Countries Go Bankrupt?
First it was mortgage lenders. Then large banks began to wobble. Now, entire countries, including Ukraine and Pakistan, are facing financial ruin. The International Monetary Fund is there to help, but its pockets are only so deep.
No, Alexander Lukyanchenko told reporters at a hastily convened press conference last Tuesday, there is "no reason whatsoever to spread panic." Anyone who was caught trying to throw people out into the street, he warned, would have the authorities to deal with.
Lukyanchenko is the mayor of Donetsk, a city in eastern Ukraine with a population of a little more than one million. For generations, the residents of Donetsk have earned a living in the surrounding coalmines and steel mills, a rather profitable industry in the recent past. Donetsksta, a local steel producer, earned €1.3 billion ($1.65 billion) in revenues last year.
But last Tuesday the mayor, returning from a meeting with business leaders, had bad news: two-thousand metalworkers would have to be furloughed. Lukyanchenko doesn't use the word furlough, instead noting that the workers will be doing "other, similar work." But every other blast furnace has already been shut down, and one of the city's largest holding companies is apparently gearing up for mass layoffs.
Under these conditions, how could panic not be rampant in Donetsk, the capital of Ukraine's industrial heartland? In Mariupol, a steelworking city, a third of the workers have already been let go. The chemical industry, Ukraine's second-largest source of export revenue, is also ailing. In the capital Kiev, booming until recently, construction cranes are at a standstill while crowds jostle in front of currency exchange offices, eager to convert their assets into US dollars.
Donetsk is in eastern Ukraine, 8,100 kilometers (5,030 miles) from New York's Wall Street and 2,700 kilometers (1,677 miles) from Canary Wharf, London's financial center. But such distances are now relative. The world financial crisis has reached a new level. No longer limited to banks and companies, it is now spreading like wildfire and engulfing entire economies. It has reached Asia and Latin America, Eastern Europe, Iceland the Seychelles, the Balkan nation of Serbia and Africa's southernmost country, South Africa.
It is a development that has investors and speculators alike holding their breath. Some are pulling their money out of troubled countries, while others are betting on a continued decline -- and in doing so are only accelerating the downturn. Central banks are desperately trying to halt the downward trend, but in many cases the plunge seems unstoppable.
At first, it seemed as if the crash could be limited to Iceland. But now countries like Ukraine, Pakistan and Argentina are proving to be almost as vulnerable as the small island nation in the North Atlantic. It seems as though another country is added to the growing list of nations on the verge of collapse almost daily.
FROM THE MAGAZINE
Find out how you can reprint this DER SPIEGEL article in your publication. A national bankruptcy isn't just some theoretical construct. Argentina experienced it in 2001 and Russia three years earlier. Germany has gone bankrupt twice in its more recent history, once in 1923 and the second time after 1945. A country has reached this final stage if, as a result of war or blatant mismanagement, it has gambled away all trust, can no longer service its debt or convince anyone to lend it any money, no matter how high an interest rate it promises to pay.
This is what is currently happening to Iceland. The central bank in the capital Reykjavik increased its prime rate by six points to 18 percent last week. Venezuela, where inflation is also high, is now offering 20 percent to stimulate interest in its government bonds. At the moment, however, investors are shying away from all risk.
In the end, the rating agencies will have no choice but to downgrade the problem countries to their lowest level of creditworthiness. When that happens, lenders will have no choice but to write off much of their money. For citizens, national bankruptcy would probably lead to massive inflation.
The threshold countries, described until recently as "emerging" economies, are in for an especially rough ride. "The dream that they would be spared seems to have come to an end," says Rolf Langhammer, vice-president of the Kiel Institute for the World Economy.
Countries like Russia and Brazil owe their recent success in large part to the boom in commodities the world has experienced in recent years. But now prices for oil, copper, wheat and corn have plunged and a giant spiral of debt has begun to turn. The companies and banks that borrowed vast amounts of money abroad for their investments can no longer service their debt, and investors are pulling out their capital. As foreign currency becomes scarce and imports unaffordable, the currencies of these countries are losing value, which only increases the mountain of debt.
According to Stephen Jen, a currency specialist with the US bank Morgan Stanley, the flow of capital to threshold countries could drop by more than half -- from the current level of €575 billion ($730 billion) to €230-270 billion ($292-343 billion) -- if world economic growth drops to only 1 percent in 2009. The demise of these countries, says Jen, represents the new "epicenter of the global crisis."
The looming crisis has the countries in most dire need lining up for emergency loans from the International Monetary Fund (IMF). But all they are doing is buying time -- a few weeks, or perhaps even months -- and hoping that the general situation will soon improve.
The Ghost of Buenos Aires
The signs of looming national bankruptcy are plentiful, and bankers in the Uruguayan capital of Montevideo know them well. In late 2001, they were the first to see the coming crash in Argentina. Men traveled across the Rio de la Plata, from Buenos Aires to Montevideo, carrying suitcases filled with US dollars. They stood in long lines at the city's banks, depositing the contents of their suitcases into accounts and safe deposit boxes there. Uruguay is South America's Switzerland, a safe haven for money in times of crisis. No one asks about where the millions come from.
DER SPIEGEL
Argentina in crisis.
Once the Argentine businessmen had transferred their dollars abroad, the second phase of the collapse began. The Argentine government froze all bank accounts, capping the maximum amount an accountholder could withdraw at only $250 (€198) a week. Small investors, those who had left their money in the banks, were the hardest hit. Tens of thousands of desperate citizens stormed the banks, and many spent nights sleeping in front of the automated teller machines.
The last phase of the downturn began in the Buenos Aires suburbs. After consumption had dropped by 60 percent, young men began looting supermarkets. In December 2001, 40,000 people gathered on Plaza de Mayo in front of the Casa Rosada, the presidential palace. There, they banged pots and pans together day and night, until an unnerved President Fernando de la Rúa fled by helicopter.
The image of the fleeing president has burned itself into the collective memory of Argentineans. It marks the worst financial crisis of the last 100 years. De la Rúa's successor allowed the peso to float free on the world currency-exchange markets after it had been pegged to the US dollar at a ratio of 1:1. Tens of thousands of small business owners, who had incurred debt when the peso was still pegged to the dollar, filed for bankruptcy.that Argentina would not be able to repay its $145 billion (€115 billion) in foreign debt.
Is history repeating itself today?
Economic experts have been warning for months that Argentina is again heading toward national bankruptcy. Men are traveling to Uruguay once again with suitcases filled with cash. In the space of only three weeks, more than $700 million (€553 million) was withdrawn from Argentine bank accounts. Government bonds have lost more than half of their value. ATMs are no longer giving out more than 300 pesos, and inflation is running rampant
No, Alexander Lukyanchenko told reporters at a hastily convened press conference last Tuesday, there is "no reason whatsoever to spread panic." Anyone who was caught trying to throw people out into the street, he warned, would have the authorities to deal with.
Lukyanchenko is the mayor of Donetsk, a city in eastern Ukraine with a population of a little more than one million. For generations, the residents of Donetsk have earned a living in the surrounding coalmines and steel mills, a rather profitable industry in the recent past. Donetsksta, a local steel producer, earned €1.3 billion ($1.65 billion) in revenues last year.
But last Tuesday the mayor, returning from a meeting with business leaders, had bad news: two-thousand metalworkers would have to be furloughed. Lukyanchenko doesn't use the word furlough, instead noting that the workers will be doing "other, similar work." But every other blast furnace has already been shut down, and one of the city's largest holding companies is apparently gearing up for mass layoffs.
Under these conditions, how could panic not be rampant in Donetsk, the capital of Ukraine's industrial heartland? In Mariupol, a steelworking city, a third of the workers have already been let go. The chemical industry, Ukraine's second-largest source of export revenue, is also ailing. In the capital Kiev, booming until recently, construction cranes are at a standstill while crowds jostle in front of currency exchange offices, eager to convert their assets into US dollars.
Donetsk is in eastern Ukraine, 8,100 kilometers (5,030 miles) from New York's Wall Street and 2,700 kilometers (1,677 miles) from Canary Wharf, London's financial center. But such distances are now relative. The world financial crisis has reached a new level. No longer limited to banks and companies, it is now spreading like wildfire and engulfing entire economies. It has reached Asia and Latin America, Eastern Europe, Iceland the Seychelles, the Balkan nation of Serbia and Africa's southernmost country, South Africa.
It is a development that has investors and speculators alike holding their breath. Some are pulling their money out of troubled countries, while others are betting on a continued decline -- and in doing so are only accelerating the downturn. Central banks are desperately trying to halt the downward trend, but in many cases the plunge seems unstoppable.
At first, it seemed as if the crash could be limited to Iceland. But now countries like Ukraine, Pakistan and Argentina are proving to be almost as vulnerable as the small island nation in the North Atlantic. It seems as though another country is added to the growing list of nations on the verge of collapse almost daily.
FROM THE MAGAZINE
Find out how you can reprint this DER SPIEGEL article in your publication. A national bankruptcy isn't just some theoretical construct. Argentina experienced it in 2001 and Russia three years earlier. Germany has gone bankrupt twice in its more recent history, once in 1923 and the second time after 1945. A country has reached this final stage if, as a result of war or blatant mismanagement, it has gambled away all trust, can no longer service its debt or convince anyone to lend it any money, no matter how high an interest rate it promises to pay.
This is what is currently happening to Iceland. The central bank in the capital Reykjavik increased its prime rate by six points to 18 percent last week. Venezuela, where inflation is also high, is now offering 20 percent to stimulate interest in its government bonds. At the moment, however, investors are shying away from all risk.
In the end, the rating agencies will have no choice but to downgrade the problem countries to their lowest level of creditworthiness. When that happens, lenders will have no choice but to write off much of their money. For citizens, national bankruptcy would probably lead to massive inflation.
The threshold countries, described until recently as "emerging" economies, are in for an especially rough ride. "The dream that they would be spared seems to have come to an end," says Rolf Langhammer, vice-president of the Kiel Institute for the World Economy.
Countries like Russia and Brazil owe their recent success in large part to the boom in commodities the world has experienced in recent years. But now prices for oil, copper, wheat and corn have plunged and a giant spiral of debt has begun to turn. The companies and banks that borrowed vast amounts of money abroad for their investments can no longer service their debt, and investors are pulling out their capital. As foreign currency becomes scarce and imports unaffordable, the currencies of these countries are losing value, which only increases the mountain of debt.
According to Stephen Jen, a currency specialist with the US bank Morgan Stanley, the flow of capital to threshold countries could drop by more than half -- from the current level of €575 billion ($730 billion) to €230-270 billion ($292-343 billion) -- if world economic growth drops to only 1 percent in 2009. The demise of these countries, says Jen, represents the new "epicenter of the global crisis."
The looming crisis has the countries in most dire need lining up for emergency loans from the International Monetary Fund (IMF). But all they are doing is buying time -- a few weeks, or perhaps even months -- and hoping that the general situation will soon improve.
The Ghost of Buenos Aires
The signs of looming national bankruptcy are plentiful, and bankers in the Uruguayan capital of Montevideo know them well. In late 2001, they were the first to see the coming crash in Argentina. Men traveled across the Rio de la Plata, from Buenos Aires to Montevideo, carrying suitcases filled with US dollars. They stood in long lines at the city's banks, depositing the contents of their suitcases into accounts and safe deposit boxes there. Uruguay is South America's Switzerland, a safe haven for money in times of crisis. No one asks about where the millions come from.
DER SPIEGEL
Argentina in crisis.
Once the Argentine businessmen had transferred their dollars abroad, the second phase of the collapse began. The Argentine government froze all bank accounts, capping the maximum amount an accountholder could withdraw at only $250 (€198) a week. Small investors, those who had left their money in the banks, were the hardest hit. Tens of thousands of desperate citizens stormed the banks, and many spent nights sleeping in front of the automated teller machines.
The last phase of the downturn began in the Buenos Aires suburbs. After consumption had dropped by 60 percent, young men began looting supermarkets. In December 2001, 40,000 people gathered on Plaza de Mayo in front of the Casa Rosada, the presidential palace. There, they banged pots and pans together day and night, until an unnerved President Fernando de la Rúa fled by helicopter.
The image of the fleeing president has burned itself into the collective memory of Argentineans. It marks the worst financial crisis of the last 100 years. De la Rúa's successor allowed the peso to float free on the world currency-exchange markets after it had been pegged to the US dollar at a ratio of 1:1. Tens of thousands of small business owners, who had incurred debt when the peso was still pegged to the dollar, filed for bankruptcy.that Argentina would not be able to repay its $145 billion (€115 billion) in foreign debt.
Is history repeating itself today?
Economic experts have been warning for months that Argentina is again heading toward national bankruptcy. Men are traveling to Uruguay once again with suitcases filled with cash. In the space of only three weeks, more than $700 million (€553 million) was withdrawn from Argentine bank accounts. Government bonds have lost more than half of their value. ATMs are no longer giving out more than 300 pesos, and inflation is running rampant
Negotiating your way around a tough economy
Anybody that’s a fan of bartering is a fan of mine.
Barter is the bedrock of ALL economics… it’s the “bedrock trampoline” a crashing economy smashes into before it eventually bounces back.
If you’re in business and you don’t barter directly with other business owners, or use an ethical, regulated barter company such as Merchants Barter Exchange (MBE), you’re seriously missing out on multiple benefits. That goes for the good economic time AND the bad economic times.
Just imagine how much business you’d lose if you didn’t accept credit cards…? How much business are you losing by not using the MBE barter system…?
Let’s hope people don’t let this country go the way Argentina did back in 2002 and HAD TO use barter because the country went BANKRUPT.
Barter is the bedrock of ALL economics… it’s the “bedrock trampoline” a crashing economy smashes into before it eventually bounces back.
If you’re in business and you don’t barter directly with other business owners, or use an ethical, regulated barter company such as Merchants Barter Exchange (MBE), you’re seriously missing out on multiple benefits. That goes for the good economic time AND the bad economic times.
Just imagine how much business you’d lose if you didn’t accept credit cards…? How much business are you losing by not using the MBE barter system…?
Let’s hope people don’t let this country go the way Argentina did back in 2002 and HAD TO use barter because the country went BANKRUPT.
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