Planet Yelnick

Battling the Great Recession: More Powerful Weapons, Much Bigger Mistakes

Guestblog - enjoy!

Bad times have a scientific value. These are occasions a good learner would not miss. – Ralph Waldo Emerson

For years, the Great Recession has affected a number of families in the United States.

The economic meltdown has forced private sectors to reduce their workforce. That, or employees have decided to find jobs elsewhere. The recession, though considered “a period of dark times”, is a wake-up call.

With the rising unemployment rate, what else is in store for you? How will you survive?

Recession and Weapons of Mass Destruction

Although the war with Iraq did not directly cause the recession, it had somehow magnified its degree.

According to the Center for Economic and Policy Research (CEPR), while the war did impose serious costs on the economy of the United States, it cannot be entirely blamed for the Great Recession.

The root cause is the collapse of the housing sector.

However, continually spending for ammunition and other military equipment had added to the economic meltdown. This drastic move has gradually drained resources, and has reduced the number of jobs available.

Now that America is slowly building itself from the recession, though the job market has not fully regained itself, the possibility of the employment rate dwindling may discourage you to look for jobs.

What do you now do in the midst of the crisis?

The answer cannot be more obvious: You go back to your roots, do what you love best, and earn from it. Simply put, be an entrepreneur.

Thrive in your Business, Survive the Great Recession

Despite the improvement in the economy, you cannot deny that the recession may still be pulling down the employment rate. You can save your money, cut back on resources, and then you can get by. But then, a more positive approach lies in learning from what happened.

It now becomes clear for families that unemployment lingers.

Don Peck, in his article “How a New Jobless Era will Transform America”, laments the fact that people might not yet feel a sense of normalcy even if the Great Recession seems to be taking a backseat.

However, he says that innovation can allow an economy to rise and create more jobs.

Tiffany Meyers of Entrepreneur shares the same sentiment. Instead of feeling low, change the way you think.

Use the aftermath of the recession as your springboard to create your startup business and make innovations.

As Emerson said, learn from the bad times. Julie Meyer, one of the most influential women in Europe, believes that entrepreneurs can lead a country out of recession.

She says that “there’s a new social contract emerging which is around the individual” and that “everybody is aware of the high unemployment in the group coming out of universities.”

Stephanie Johnson, 32 and a mother of three, was displaced from her job as a graphic artist for a local newspaper.

During the recession, her problem was how to feed her children. She did save what was left of her earnings, and she refrained from shopping online.

However, she figured she could not live that way forever, especially when her kids were growing up.

After the recession, Stephanie used a portion of her savings as capital and made organic bath products. It used to be a hobby for her, but the recession prompted her to become a fulltime entrepreneur.

Ultimately, the recession has taught her to use her capacity to fight against unemployment.

It is not a question of how the Great Recession will transform America, but of how you will transform your nation.

Wrapping Up

The decision to start your own business may seem intimidating at first, and you might even think of investing in IPO’s to create your brand and establish your credibility.

Do not be afraid. Remember that you are more powerful than the Great Recession and that through your efforts; you can emerge from the economic rubble.

Who knows?

You might even save America from another recession in the future.

About the Author

Bill Achola is a financial publisher who owns a fast-growing, dynamic and innovative investment blog that empowers investors to make the right decision. Check out his blog where he writes and talks about best investing strategies at http://traderushreview.us.com.

 

China Bubble – Great Call by Yves

I have frequently posted as a guestblogger Yves Lamoureux. Back in 2013 he called a coming China Bull Market when everyone was bearish. Here is how it turned out:

The question now is when will it burst? It shows the parabolic characteristics of a bubble. Is China 2015 = Japan 1989?

The Unicorn Bubble is Finally Getting its Due

Tech bubble: Different this time? 

By Elliott Wave International

Editor's note: This article is from Elliott Wave International's brand-new investment report, "U.S. Investors Face a Giant, Historic Bubble." It originally appeared in the April issue of The Elliott Wave Financial Forecast, published March 27, 2015. For a limited-time, EWI has agreed to give our readers exclusive free access to the full report. Please click here to read it now.

In March, we covered the return to a popular fascination with technology.

The striking resemblance to 2000's technology mania is not going unnoticed. How can it? With the NASDAQ's much heralded return to 5000 and magazine covers proclaiming "Google Wants You To Live Forever," concern about an "asset bubble" is being raised. But this is actually another throwback to early March 2000, when the NASDAQ reached its all-time high and the Financial Forecast remarked on a "public ambivalence toward warnings of any kind."

The March issue of The Elliott Wave Theorist explains that while people may remember some of the details, they "forget their prior mood and rationalize present extremes into normality."

This March 7 headline from a major financial paper offers a perfect example of how this "normalization" works: "Forget 2000. It's a Different Investing Ballgame." Really? Yeah, really. "It really is different this time," says another. "The crazy valuations seen at the turn of the millennium -- when silly concepts, such as collecting eyeballs, attracted billions of dollars from breathless speculators wanting to get in on the new, new thing -- are absent."

There's just one problem with this assessment, it's not accurate. Here's the reality, or should we say surreality, as depicted in Bloomberg on March 17:

The Fuzzy, Insane Math That's Creating
So Many Billion-Dollar Tech Companies

The article discloses how companies are shooting to "astronomical valuations," mostly with Internet ideas that capture people's bullish imaginations and, as in 2000, cause them to look beyond mundane things such as cash flow and profits. Once again, such stone-age metrics are less important than "the number of people using the product" and "whether they pay for it. Investors salivate over what's called 'hockey-stick' growth curves, indicating massive uptake. Costs, especially operations costs, are largely ignored."

As in 2000, the fever has been spreading fast. According to Bloomberg, start-ups with billion-dollar valuations were once dubbed "unicorns" because of their rarity. Now, Bloomberg counts more than 50 of them. Many have expanded ten-fold, so a new buzzword, "decacorn," now applies to those with capitalizations of more than "$10 billion, which includes Airbnb, Dropbox, Pinterest, Snapchat and Uber."

Of course, the driving force behind many of these investments is the same--a fear of missing out (FOMO).

"A severe case of FOMO can cause some to do crazy things to get into the hottest deals," says Bloomberg. This is exactly what the Financial Forecast said in March 2000, when we explained why people fail to heed ample warnings in the final throes of a mania: "Acting on such an opinion might mean missing something on the upside. 'The average person must ride it out,' says [a] Nobel Prize winner. Quotes such as these will deserve preservation in bronze when the bear market is mature." Clearly, that time still lies ahead.

For compelling Elliott wave evidence of a culmination of the Mania Era, see the five-wave advance in the share price of the current technology leader, Apple Inc., on page 3 of the March Elliott Wave Theorist. As the Theorist notes, after rising more than 14,500% over the past 12 years, S&P Dow Jones Indices added the stock to the Dow Jones Industrial Average on March 19.

This is one more remarkable parallel to the prior technology mania, as Microsoft was added to the Dow Industrials just prior to its January 2000 top. Here's how EWFF interpreted its addition in November 1999:

The ultimate concession to technology is due November 2, when Microsoft will be inducted into the Dow Jones Industrial Average. For most of the bull market, the world's most dominant stock was excluded from the world's premier blue-chip average. But just as RCA was added to the Dow in October 1928 (and removed in 1932), Microsoft has assumed its rightful place at the head of the pack, in time to lead the way down.

Apple has just been acknowledged in the same way and for the same reason. The pressure to pile onto the technology bandwagon has proved irresistible to the Dow's purveyors. This has generally happened when the most important stock market reversals were at hand.

Editor's note: This article is from Elliott Wave International's brand-new investment report, "U.S. Investors Face a Giant, Historic Bubble." It originally appeared in the April issue of The Elliott Wave Financial Forecast, published March 27, 2015. For a limited-time, EWI has agreed to give our readers exclusive free access to the full report. Please click here to read it now.