Breakins, bailouts, and BS
I've been quieter on Livejournal lately because I've been dealing with a break-in to my home office and the theft of thousands of dollars worth of equipment and software I used to run my web development and marketing business. This morning, I lost the last of the projects I had in the pipeline. Unfortunately, some mistakes made with the insurance company means that our policy will not cover this. And after a week of not being able to locate our two suspects, it's likely that there's no hope of recovering anything, since the items have likely been sold off already.
I've been exploring every option I can for saving the business, but so far I've yet to find anything that would make it possible to keep going. I have not found any way around the fact that without a fairly quick loan so that there is capital to get things up and running again ASAP, I'm probably out of business. And of course, that means that all the long term projects in the works that could have had a significant payoff will be useless because someone else will get to market first.
Unfortunately, thanks to the meltdown of the financial system, small business loans are virtually impossible to get at the moment--not that I would be optimistic about our chances even if the economy were good, since banks don't usually consider intellectual property to be a tangible asset--especially with a small business owner who has been pretty obsessive about avoiding credit and debt up to this point. I'm going through personal contacts and everything else I can think of, however, so there is still some hope. If anyone reading has any information they can pass along, I'd be grateful.
And so, most of the past week has been a lot of worrying and waiting to hear back from people and institutions. I hate the business being at a complete standstill with nothing to do but wait. I've distracted myself a little by watching and reading more about the current wider financial crisis, including a special John Stossel report ("Bailouts and bull") on ABC's 20/20 and a Dateline NBC three part special on the mortgage crisis.
Between learning more about the depths to which the financial system is completely rotten and following the AIG bonus fiasco, I am wondering one thing. See, I have been saying for over five years now that if the American people understood just how badly they were getting screwed over, there would be masses of people in the streets within a day. Well, now we are getting some idea of just how badly we are all getting screwed. Where, I wonder, is the revolution?
I have a huge degree of cynicism about economics and politics. But the depths of this current fiasco has left me shaking my head in silent disbelief even more than usual. Everything seems to have completely broken down. Lenders were pushing people into loans they couldn't afford, even to the point of lying about the incomes of prospective borrowers. Underwriters and auditors went along with this blatant fraud. Wall Street was perfectly happy to invest obscene sums of money in securities they knew nothing about. Rating agencies fell into line and gave their stamp of legitimacy to what was nothing more than a house of cards. And anyone who saw what was going on and tried to sound the alarm was either ridiculed, bought off, blackmailed, or otherwise silenced.
So far, we've put at least $350 billion into propping up the banks and they are still not lending. Citigroup is trading at around a dollar or two per share, meaning the government could have simply bought the whole damn company for a lot less money than we have already put into this bottomless pit. After all, if it is the taxpayers' money at stake, the taxpayers should get to call the shots. And this $75 billion plan to "help homeowners" seems like more baloney--instead of writing down debts to some manageable level and making the people who made bad loans eat the costs of their bad business decisions, the government will end up buying worthless mortgage-backed securities for 100 cents on the dollar in the name of keeping people in their homes.
Personally, I'm with Eric Schmidt, the CEAO of Google, who said in a recent BBC interview that if a company is "too big to fail", it should either be nationalized or broken up.
Meanwhile, I can't get a loan to stay in business when what I do provides real value to businesses (in the form of more customers and more sales) instead of just moving money around. I also make every effort to use my business to help people instead of being a predator on society. But Wall Street executives, for some reason, seem to feel that they have "earned" millions in compensation and bailouts for their companies when their problems are their own fault.
Hardly seems fair. But this, I suppose, is now the American way.
I've been exploring every option I can for saving the business, but so far I've yet to find anything that would make it possible to keep going. I have not found any way around the fact that without a fairly quick loan so that there is capital to get things up and running again ASAP, I'm probably out of business. And of course, that means that all the long term projects in the works that could have had a significant payoff will be useless because someone else will get to market first.
Unfortunately, thanks to the meltdown of the financial system, small business loans are virtually impossible to get at the moment--not that I would be optimistic about our chances even if the economy were good, since banks don't usually consider intellectual property to be a tangible asset--especially with a small business owner who has been pretty obsessive about avoiding credit and debt up to this point. I'm going through personal contacts and everything else I can think of, however, so there is still some hope. If anyone reading has any information they can pass along, I'd be grateful.
And so, most of the past week has been a lot of worrying and waiting to hear back from people and institutions. I hate the business being at a complete standstill with nothing to do but wait. I've distracted myself a little by watching and reading more about the current wider financial crisis, including a special John Stossel report ("Bailouts and bull") on ABC's 20/20 and a Dateline NBC three part special on the mortgage crisis.
Between learning more about the depths to which the financial system is completely rotten and following the AIG bonus fiasco, I am wondering one thing. See, I have been saying for over five years now that if the American people understood just how badly they were getting screwed over, there would be masses of people in the streets within a day. Well, now we are getting some idea of just how badly we are all getting screwed. Where, I wonder, is the revolution?
I have a huge degree of cynicism about economics and politics. But the depths of this current fiasco has left me shaking my head in silent disbelief even more than usual. Everything seems to have completely broken down. Lenders were pushing people into loans they couldn't afford, even to the point of lying about the incomes of prospective borrowers. Underwriters and auditors went along with this blatant fraud. Wall Street was perfectly happy to invest obscene sums of money in securities they knew nothing about. Rating agencies fell into line and gave their stamp of legitimacy to what was nothing more than a house of cards. And anyone who saw what was going on and tried to sound the alarm was either ridiculed, bought off, blackmailed, or otherwise silenced.
So far, we've put at least $350 billion into propping up the banks and they are still not lending. Citigroup is trading at around a dollar or two per share, meaning the government could have simply bought the whole damn company for a lot less money than we have already put into this bottomless pit. After all, if it is the taxpayers' money at stake, the taxpayers should get to call the shots. And this $75 billion plan to "help homeowners" seems like more baloney--instead of writing down debts to some manageable level and making the people who made bad loans eat the costs of their bad business decisions, the government will end up buying worthless mortgage-backed securities for 100 cents on the dollar in the name of keeping people in their homes.
Personally, I'm with Eric Schmidt, the CEAO of Google, who said in a recent BBC interview that if a company is "too big to fail", it should either be nationalized or broken up.
Meanwhile, I can't get a loan to stay in business when what I do provides real value to businesses (in the form of more customers and more sales) instead of just moving money around. I also make every effort to use my business to help people instead of being a predator on society. But Wall Street executives, for some reason, seem to feel that they have "earned" millions in compensation and bailouts for their companies when their problems are their own fault.
Hardly seems fair. But this, I suppose, is now the American way.