Robert Kiyosaki Blog

This is a video that really drives home the point that the “bailout” Washington D.C.  is doing DOES NOT WORK, and there are others who fill the void.  No matter how you look at it, it looks like small business loan sharking, but it is better than no loan at all.

Would you do business with this type of guy?

So if we can’t find money from friends and family we might have to resort to these types of folks.  The regular banks have seemed to turn tail on making loans to small businesses.  What I am curious about is if small businesses are the engine that pull the economic train why isn’t there some sort of economic program set up by the SBA to get these types of loans in place?  In my understanding the SBA does NOT make loans, they help guarantee the loans that the small businesses must get from the banks on their own merit.

While the lobbying efforts for Fortune 500 companies is substantial there really is very little lobbying for small businesses that is effective.  If small businesses we just able to do two things:

1) be able to secure affordable loans

2) be able to get group coverage for health insurance at substantial discounts

We just might see the economy rebound significantly.  Think about this just two simple things could get the economy jump started.  Instead it seem like we have a snake trying to eat a horse with the new healthcare bill and the snake is not digesting it so well! ;-0)

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Small Business Lending and Loan Sharking

In this day and age I am constantly confronted with decisions.  I am also constantly barraged with information of others whose business ethics are simply wrong.  They know it when they do it but because they can at the expense of their employees or clients.  Take for example WalMart.  In this CNN Money article there appears to be a trend where they are dumping brands for their own private labels.  This is called the power of market share, WalMart owns the retail space.  At the same time, the product company has the opportunity to come back should they spend heavily on advertising to get the users into WalMart’s stores.

Technically there is nothing “wrong” with this business practice, however is WalMart doing the right thing?  Are they giving their clients the best products at the lowest prices?  Maybe maybe not.  What if let’s say that Kimberly Clark is in the toilet paper business.  Let’s say they get squeezed out by WalMart because they choose NOT to pay for the additional advertising to be on WalMart’s favored status list. Let’s say Kimberly Clark has a $5 Trillion imaginary contract with the largest pulp manufacturers Big Pulp Mfg. Co.   What if WalMart also had a $500 Billion contract with Big Pulp Mfg. Co.  Kimbery Clark would rank over WalMart.

Let’s say there is a new beetle that destroys most of the trees in Big Pulp Mfg. Co. and demand goes through the roof.  Big Pulp Mfg. Co. decides to reward Kimberly Clark with paper allocation and not WalMart.   Now WalMart customers run out of ass wipe.  Oh my, Houston we now have a problem of epic proportions.  WalMart begs Kimberly Clark to sell them their toilet paper. However, the relationship is destroyed and there is no longer any trust, so Kimberly Clark decides to return the favor by selling to WalMart as such a high price it prices WalMart out of the market.  This is what is known as a pissing match and no-one wins especially the consumer.

We are seeing similar business model fluctuations with Google taking over the Yellow Pages, Book Publishing, Newspaper Advertising etc.  While market supply and demand don’t involve business ethics necessarily many businesses have become dependent on Google either for SEO or PPC or traffic in general, they literally have the power to make a break companies by deindexing them.  And have done so for various reasons.  So they say, “do no evil.”

So on a smaller scale for small businesses we are faced with similar situations almost on a daily basis just not as visible.  When it it OK to bend the rules a little and get the competitive advantage and when is it not?  I guess we have to ask ourselves that and search deep down for the right answer, or ask our colleges and mentors for guidance.  If you are “too ethical” I have found to be on the losing side so there is a fine balance.  In this era of “gotcha” bad news travels fast and it only takes one bad incident to destroy a life time of creditability, ask Tiger Woods.

What is Business Ethics?

Let me start off by saying I am “out of integrity.”  I am out of integrity with myself on too many occasions.  For example, I tell myself I will go to the gym today, and guess what?  The exercise to the refrigerator is a whole lot more enjoyable.  (However today I actually did make it to the gym!)   But I can tell you I had a task on my written to do list and I have not done it yet, I chose to write a blog post instead.  I’m supposed to call a client on their content and just don’t want to, it will require me to think about their content which I want to do but don’t want to actually have to think about it.  Now I know I can wait another day to do this but it just makes the flow of the project and the organization a little messier.

My integrity in the workspace really has more to do with my personal integrity with self.  Because no-one knows about this other than me.  I do my best to follow through on my word all the time and every time weather it be personal or professional because I treat others differently than myself, I am kinder to them than to I.  I follow through with them than to I and I think you will hear that if you talk to friends and colleagues.

But back to integrity in the work place.  It is these little types of things that break down communications, they then break down relationships both personal and professional.  A glaring example is Tiger Woods saying “I do,” but what he really did was something entirely different.  He was out of integtity with himself and his family and who knows who else.  How many times in the workplace have you had a boss or a client say I will call you tomorrow with the <fill in the blank> and the call never comes.  Guess what?  You are left hanging.

There was probably some justification for not making the call but that person is out of integrity in the workplace as well as personally out of integrity.  S/he made a promise to call and did not follow through.  I can guarantee you that this happens ALL the time.  We tend to be blaze about it, and say “oh they are just that way.”  But at the end of the day weather it be a promise to your kid or a promise to your boss we get much better results in life by doing what we say and saying what we do.

So I will make that call to the client regarding the content. 

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Integrity in the Workplace

Robert Kiyosaki Network Marketing Richdad financial freedom now
Added: January 15, 2010
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Robert Kiyosaki Network Marketing MLM “Make More Money “

~ Robert Kiyosaki ~

On the cover of the October 19, 2009 issue of “Time” magazine ran this headline: “Why It’s Time to Retire the 401(k).” The cover picture was ominous, showing a 401(k) sinking like the Titanic.

I recommend reading this entire article, especially if you do have a 401(k). My concern is that the flaws of this retirement plan will grow into personal tragedies as the first of approximately 75 million baby boomers retire, leading to the biggest stock market crash in history.

But in spite of the apparent problems with the 401(k) plan, the darlings of financial media continue to tout its benefits. The same month “Time” ran its article, “More” magazine’s financial guru, Jean Chatzky, wrote an article about using low-interest savings to pay off high-interest credit cards. In the article she states, “There’s no better guaranteed return on your money (except, perhaps, a 401(k) match).”

Countering Jean’s wisdom of “no better guaranteed return,” the “Time” article stated, “At the end of 1998, the average 401(k) balance was $47,004. By the end of 2008, the average balance was down to $45,519.” If that is a great guaranteed return, I’m glad I don’t have a 401(k). The “Time” article pointed out that $100 in 1998, after inflation, was worth about $73 in 2008, a loss of $27 after ten years. So whom do you believe…”Time” or “More” magazine?

If you are unsure as to whom (and what) to believe, the “Time” article made two more statements worth considering. They are:

1. “The older you are the riskier a 401(k) gets.”

2. “Forty-four percent of all Americans are in danger of going broke in their post-work years.”

Now, I can hear some of you saying, “But the stock market is going back up. Green shoots are appearing. Everything is fine. The crash was just a correction.” For those optimists among you: I wish that all of your dreams come true and you live happily ever after.

I do not criticize the 401(k) plans just to criticize. I write because I am concerned. Let’s say “Time” magazine’s estimates are correct. Let’s say 44 percent of all Americans will go bankrupt after retirement. For approximately 75 million baby-boomers preparing to retire, that means 33.8 million of them will go bust once they stop working. To me, this is disturbing.

While many think the financial crisis is over, I believe the worst is yet to come. In spite of the green shoots in the stock market, the fundamentals of the U.S. government are worsening. I doubt Social Security can afford the avalanche of retiring baby boomers. The Social Security fund is empty, underfunded by approximately $10 trillion. For the first time in 35 years, Social Security will not pay a cost of living increase. And Medicare is projected to face a shortfall as well, of between $65 and $85 trillion.

In 2009, interest payments on our national debt are about $380 billion, which is $1 billion a day in interest. At the same time, the national debt is projected to climb to $20 trillion by 2012, which means the U.S. will have to borrow money just to make the interest payments.

I know the Federal Reserve Bank can continue to print more and more money…but city and state governments cannot. This means your city and state taxes will have to go up. If you think your property taxes are high now, just wait five years. I predict that, even if your home’s value does not go up, property tax rates will, and higher taxes will do wonders for property values. This means people counting on their home as their biggest asset may be disappointed.

In 1913, when the Fed was created, and in 1971, when President Richard Nixon took the U.S. off the gold standard, the ultra rich were allowed to siphon off our wealth — via our own money, the very thing we work hard for and do our best to save. In other words, with every dollar the Fed prints, our wealth is being drained via increased taxes, debt, inflation, and savings.

A Cash Heist

There are four expenses that keep the poor and middle class struggling financially. They are:

1. Taxes — both apparent and hidden

2. Debt — mortgages, credit cards, and student loans.

3. Inflation — rising food and fuel costs

4. Retirement plans — 401(k) and savings

It is via these four expenses that the rich get richer. In other words, all four of these expenses are a cash heists, the ways the rich use the government to get into our pockets, draining us of our wealth.

The Silver Lining

The silver lining of all this: With a more sophisticated financial education, rather than have taxes, debt, inflation, and retirement accounts as drains on a person’s wealth, a person can convert those government-sponsored expenses into elements that work in one’s favor. By using the same rules of money the rich use, those four expenses will make you richer. In other words, taxes, debt, inflation, and not needing a retirement plan can make you richer if you use different rules of money. As stated earlier, in 1971 Nixon changed the rules – and so should you.

In closing, the 401(k) has a few good points…but not good enough, in my opinion, given the financial challenges that lie ahead.

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The Biggest Scam Ever