Silver Linings In A Financial Meltdown

 Silver Linings in a Financial Meltdown

There is always a gap between present realities and future expectations without which there wouldn't be any enterprise, investment, credit, commerce, or currency. Whenever, at a certain point this gap becomes enormous, it creates a vacuum. This brings the need for readjustment, called recession. However, it is hard to find anything positive in the current economy. Jobs are reduced, markets reacting from dizzying highs to plummeting falls; debts are rising, inflation...there are myriad issues that compel us to draw comparisons to the Great Depression.
But as the saying goes every cloud has a silver lining, economic turbulence is no exception - common wisdom suggests that every crisis opens up opportunities for innovation. Innovators who figure out different ways to solve the problems in current will have opportunities to create new growth businesses.
The good news is people are saving money again. The Bureau of Economic Analysis reports consumers saved an annualized $297 billion in the second quarter - more than 10 times higher than the first quarter, and the highest quarterly savings since 1995. Saving in 2005 was worst than in 1933. Saving went out of style because, at the rate things were going, few saw a need to save but now people are scrambling to rebuild and replenish their personal balance sheets by saving again.
Necessity is the mother of invention. With the hike in oil prices people are opting for electric cars from Toyota and General Motors.
How does saving help economy? Countries, like people or business, grow wealthier over time by saving money and investing it wisely. The result of borrowing with little or no saving made our economy collapse. When an economy saves money, it has the resources it needs to invest without borrowing from someone else and hence, creates real wealth. Domestic savings creates money which can be invested in investments in projects that eventually create jobs, keep interest rates low, and push the economy along at a sustainable pace.
The bottom line is ‘work hard and spend less' will make you wealthy, ‘borrow heavily and spend more' will make you poor.
During recession marketing budgets may also get slashed. But if a firm has the resources and proper strategies then recession is the right opportunity for a firm to generate revenue and build market share. Here are three such strategies:

1. Chalk out marketing plans. A marketing plan is like a road map, which includes goals and schemes supporting the overall vision and strategic direction of the firm. Coherent implementation of the plan greatly increases the chances of meeting goals and outperforming.
2. Build a sales team. Hiring full-time salespeople and building a strong sales team works hand in hand with marketing program will help achieve this goal.
3. Implement niche marketing strategy. Niche practices help differentiate a firm and eliminate competitors hence focus on a small niche market.

Along with the above strategies every company should focus on soft skill training, regularly monitor client acceptance and retention policies and have a transparent communication of policies and procedures throughout the organization.
Though it creates an overall pessimistic outlook, here are few benefits recession:

• You will start thinking about investing in a more stable and inflation-free investment options, which is a good move. And, oh, buy dollar now.
• Recession brings out the creativity juices in you which lead to better productivity and more breakthroughs. Also you will think of creative ways to lead a healthier and greener life. You will consider reducing non-essential household power consumption, walking the pavement or riding a bicycle instead of driving a car, more home cooking, more vegetable eating, and many other benefits.
• Recession is good for your personal finance management. You will track every penny spent more vigorously than ever. Retail businesses will usually offer you more discounts for a longer period to attract and retain customers and visitors, which is good for you.
• Recession will bring family members close and bring you close to God. You will think of God more and seek for spiritual guidance more.
• What comes down must go up - nothing better than a rebounding economy. Recession will test and form your character and willpower. So be strong and courageous.

With all this in mind as we venture into a new year, we must once again look for a silver lining. The collapse of the stock and housing markets will make way for a new social order. Though the bar for success is high yet, there remain ample opportunities to be seized by those who don't lose faith. Recession is just a correction, for a better and sustainable future. A new day is almost at hand.

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