Monday, September 29, 2008

Alan Cohen on the Economy

This is a very thought-provoking article from Alan Cohen, with his suggestions on how to personally respond to our current economic crisis...

An ancient Chinese blessing wishes recipients, "May you live in interesting times." Well, we now have the answer to that prayer. Actually, all times are interesting, just in different ways.
During the last week and month the economy seems to be at the top of most people's list of urgent issues to think and talk about. Today the U.S. government is issuing a new policy to deal with the economic upsets of late. Below are some suggestions on how to get to a better feeling place about the economy, and generate practical results for yourself and others.

Here is my six-point plan. I am not an economist, and frankly I don't understand all of the complexities of the current market. I do, however, understand the relationship between thought, belief, feeling, attitude, expectation, identity, and practical prosperity. So here is my six-point plan, which will surely work if you apply it:

1. Vision. A visionary sees and remembers the Big Picture in the face of current appearances to the contrary. The Big Picture of life is utter abundance. There are vast resources, economic and otherwise, for those who recognize and claim them. A visionary thrives under all conditions. There are always people who do well in difficult economic times, as well as those who flounder in prosperous times. It is not the economy at large that determines your well being; it is the consciousness you hold in relation to it. So you have the power to create a prosperous personal economy – and as you do, you will uplift the economy at large. The two greatest achievements of the twentieth century -- the Golden Gate Bridge and the Empire State Building -- were funded and built at the height of the great depression. Some individuals with a broad perspective were not limited by the prevalent beliefs of the masses. There are, and will be, people who prosper now and in the near future. I know people whose businesses are booming now. So can yours, and by your example you can manifest abundance that will inspire others and help them in material ways.

2. Trust. When human affairs appear to falter, the hand of the divine becomes very real and practical. A Higher Power is currently running the universe far more intelligently and successfully than even the best economists. The more you stay connected to that Higher Power, the richer will be your inner peace and your ability to make healthy, productive decisions.

In a Greek myth, the King of Crete sent Theseus through the labyrinth to kill or be killed by the dreaded monster Minotaur. The king's daughter Ariadne fell in love with Theseus and gave him a thread that he let unwind on his way into the labyrinth, which guided him out once he slayed the monster. Whenever you feel trapped or lost in the labyrinth of worldly life, your strongest move is to take hold of the thread of your connection to Spirit, hold firm to it, and let it lead you back to well-being. One of Dr. Wayne Dyer’s books is entitled, There's a Spiritual Solution to Every Problem, and no advice could be more appropriate than the economic situation we face at the moment.

3. Reframe. The Chinese written symbol for "crisis" is a combination of two other symbols: "Danger" and "Opportunity." Yes, there is a danger in our current position.
And yes, there is an opportunity. Perhaps we are receiving a wake-up call to live within our means rather than leverage ourselves and our institutions beyond a healthy level. Or we are being invited to recognize that money does not make us rich, or its temporary absence of restriction make us poor. Perhaps this situation will influence the upcoming election in a way that will help us in the long run. Maybe there is a natural balancing occurring that will make our economy stronger. I cannot say exactly how this crisis will serve, but I do know that whenever I have faced and handled the experience of crisis in my personal life, I have been moved to make decisions that have made improved my world. A Course in Miracles tells us that "All change is good," and this should be no exception.

4. Reset Priorities. In an episode of the popular television series, Fantasy Island, called, "The Luckiest Man in the World," a gambler achieved his fantasy to create an unstoppable winning streak. True to form, Mr. Roark arranged for the man's young son to visit him at the same time. When the gambler became hypnotized by winning, he distanced himself from his son, and the boy was about to leave him. Finally the father realized he is the luckiest man in the world -- not for his gambling winnings, but for his family. When money seems tight, we have a window of insight to recognize how rich we are, no matter how much we have in the bank. If many of us use this time to grow closer to our families, homes, nature, activities that truly bring us joy, ourselves, and our Higher Power, this upheaval will have served us well.

5. Circulate. Keep moving your energy, financially and otherwise. The brilliant metaphysician Florence Scovel Shinn noted, "All disease is due to congestion and all healing is due to circulation." This dynamic applies impeccably to an economic congestion. When people are afraid to spend money, there is less money in circulation; then people grow afraid to spend, and the cycle goes on. The dynamics shift when consumers act not from a sense of lack or fear, but from abundance and faith. So now would be a great time to spend your money. When you do, you affirm that you have enough and you keep the circulation moving -- not just from you, but to you. If you don't have money to spend, or would rather not, then circulate your energy in other ways. Express your creativity, volunteer, paint, play music, journal, and do anything to move energy rather than let it stagnate. (Pressing buttons on the remote control to watch talking heads discuss the economy does not qualify as circulating energy.)

6. Milk Every Moment. It would be easy to think that you will be able to relax and enjoy your life as soon as the current crisis is averted or offset. But that’s the carrot at the end of the stick -- the one that you never get to bite. Either life is rewarding now, or it never will be. From the sense of the ego, or small self, if it's not the economy you have to wait to handle, it's something else. So now would be perfect opportunity to practice enjoying your day, regardless of what money is doing. Stop and chat with the clerk in the supermarket, play with your kids, call someone you love, walk in the park, or tinker with your hobby. This is the moment you've been waiting for -- don’t miss it!

Everything will work out. It always does. Be of good cheer. Be uplifted and be an uplifter, and your contribution to the economy, financial and spiritual, will be paramount.

Thursday, September 25, 2008

Free Market Economy?

As a business consultant, money drives most of my activities everyday - making money, saving money, chasing money, cutting costs...

This proposed government bailout of major US financial institutions scares me. While I certainly don't want to see our economy collapse, I also think that allocating taxpayer dollars to benefit companies that have been reckless and fiscally irresponsible heads us down a slippery slope. Even worse, it sets a precedent that if large corporations take huge risks and spend all their cash in good times, they can trust that when there is a downturn in the market the government will save them.

Every parent understands the principles of positive and negative reinforcement. If you are trying to train a child to make wise choices and accept responsibility for their behavior, you use incentives to teach them accountability. If they make good decisions, they are naturally rewarded with good things, but if they make bad decisions, bad things happen to them. These same core accountability points hold true for individuals, families and small businesses. If you choose to blow the last dollar of your savings on a trip to Hawaii and your car breaks down, you might have to take the bus or get a loan to cover repairs. If a small business spends a bundle on an ad campaign that is a total flop, they may have to fold.

Now I understand basic economics, and I know that every major US financial institution going bankrupt all at once would be catastrophic, but I don't think that is what would really happen without government intervention. These are companies that somebody will be very willing to take a gander on - if the terms are right. Consider Warren Buffet's recent investment in Goldman Sachs... he's taking a chunk of the company, but infused $5 billion in capital to keep them afloat. It's a good deal for both sides and it protects the basic principles of capitalism and a free market economy. If the government was not an option, most of these companies could find creative ways to stay in business!

One of the single most destructive trends in big business today is massive executive compensation that is not linked to results. Note that I did not say that 'massive executive compensation' alone is the problem. I believe that if you put yourself on the line to lead a Fortune 500 company and it performs well, you deserve to make a ton of money. But I have deep reservations about all the CEOs who have simply run their companies into the ground due to mismanagement, poor fiscal oversight, greed and corruption. These guys should not walk away from devasted companies with hundreds of millions of dollars. Again, it sets the wrong precedent. Do a good job and work hard - get paid a bundle. Do a bad job and take risks with other people's money - get paid a bundle. Where is the accountability? Where is the incentive to make the right decisions? How is pay linked to job performance?

Without all the inside information that folks in Washington have, I truly don't know whether or not government action is the only recourse in this situation. As I stated before, I believe that free markets tend to work themselves out. We've gotten spoiled in recent years and we can't accept the reality that good economies are often followed by periods of inflation, tighter credit and lower values on real estate and stocks. Things won't always be looking up! But here's the real issue:

If our government takes taxpayer dollars to bail out private institutions - what's in it for the tax payers?

No one is helping us right now - the little people. Why don't we bailout good people who are losing their homes... small business owners who are drawing no paycheck to keep their companies afloat... people who are in bankruptcy due to skyrocketing medical costs and a lack of health insurance coverage... people who have been laid off from these same organizations while their CEO's walk away loaded.

What's in it for me to help CitiGroup or AIG?

If the government aids these firms, I believe that politicians should do to banks what they have been doing to the American public for years - stick it to them! Don't give bailout funds - make a high interest loan with tough terms and an upwardly adjusting rate. Take enormous blocks of shares in exchange for assistance, so that the taxpayers can recoup their investment many times over when the market turns around. Demand that CEOs and executives are held accountable for their role in allowing this global crisis to happen. Change the rules so that institutions are forced to save money in safe, low risk places during times of plenty. And make sure that everyone understands that this bailout is a ONE TIME EVENT, and will not be duplicated no matter what happens.

Wall Street is a spoiled, bratty child right now. Willing to accept the rewards for taking risks, but not the responsibility for bad decisions. A free market isn't a free market unless it exists in both good times and bad times.