Entrepreneurial Credit Leverage
It seems like everyone agrees that these present economic times are the worst since the Great Depression of the 1930’s. And isn’t it true that one man’s manure is another man’s gold? The worst of times could be the best of times, right? Absolutely right, given the proper perspective and intelligent employment of assets, income, credit, and life pursuits! What was undeniably true about the stock market collapse and the ensuing decade of economic meltdown? It is this: the asset rich got richer, but the cash liquid rich become immensely wealthy! The most problematic message of this history lesson is one of long term financial discipline. By forgoing some of life’s little pleasures back then (by minimizing consumption, securities, and other depleting value debt) the cash rich scooped up stocks, real estate, energy properties, and commodities of all flavors. All for pennies on the dollar. In fact the only thing which devalued faster and greater than the dollar itself were the market and hard assets the dollar could buy. Incredible! So what’s the point? Where’s the lesson for us now? Get liquid! Get safe asset protection! Get deleveraged! Get out of debt! Build cash, highly leveraged hard assets. Borrow against appreciating assets, NOT against or for depreciating items. The next step is to redeploy your saved cash, borrowed cash, and liquid cash into growth-appreciating assets, NOT depreciating consumer stuff or leisure spending. This is where the rubber meets the road. You must be extremely disciplined to begin with. Sustain and close out your credit driving accumulation phase. Where specifically does debt and credit fit? Leverage is a mathematically positive multiplier calculation which has somehow adopted a negative overtone. The full resource borrowing was recently utilized for stocks, real estate, and the purchase of various commodities, the steep downward spiral caused financial wipe-out and/or bankruptcy for many investors ensued. The residential real estate speculators used borrowed money (credit) to jump on the explosive growth bandwagon. Resulting in those who waited too long getting left holding the bag; the bag of decreasing values, increasing mortgage payments and virtually non-existent new buyers. But, today, right now, is proving to be the most opportunistic time to maximize credit leverage, loans, credit cards, mortgages, family budget plans, SBA loans, person to person loans, etc. for the capitalization and/or recapitalization of your own entrepreneurial business. Using our axiom that good leverage is debt for appreciating assets ONLY, presents a “survival of the fittest economy” mentality that offers a once in a generation business ownership opportunity. Why not make lemonade out of lemons? Why not completely turn perceived negatives into real life-long gains?
YCC is your personal power… Ask yourself this question, “Is your traditional job, working for someone else, gone, downsized, or clearly a dead-end?” if it is wouldn’t this be the absolute optimum time to deploy leverage-credit-borrowed money to boot strap the number one growth asset? Your very own dream business? OF COURSE!
