Herman School of Business
Where did they go?
2009 will be the year of disappearance for many companies, many fellow employees, many neighbors, and more of your retirement funds. What will it mean to you?
Your company better be a buyer or it will surely be a seller. Stand still and you will be crushed. This year will have more opportunity to gain market share through a merger or acquisition than in more than two decades. Are you going to ignore it and miss a great chance to become a survivor?
Retailers will be gone in huge gobs. Not a few going under…some experts predict hundreds of names we know will become names we knew. There are too many sellers in a marketplace with very few buyers. And those pricey leases the chain operations are stuck with are now choking them to death. There is no way the sales of drastically discounted merchandise gave anyone enough margin to pay all the bills they have. Many who didn’t start the sales season with huge inventories still find themselves with a glut of stuff in the back room.
Your neighbor will slip quietly away…you never even met them…and that house next door will be vacant for many months until the paperwork drags its way through some awful, slow, foreclosure process and then resets a much lower value of your home when that one finally sells, early in 2010.
Take a look at the floor you work on and count the cubicles. Take 15 percent of those working around you and try to figure out which ones will disappear in 2009. Will you be one of those who become a ghost?
Every dime you put in your retirement account runs a risk of being worth about nine cents in 365 days…as the market could easily fall another ten percent this year…if we are lucky enough to only lose that much.
Why then do I say it is a time of opportunity?
Because your competitor can’t wait to talk about merging so both of you can perhaps keep a job…and have some cash flow. Those mergers will cost employees jobs so you better be on the buyer side instead of the side being bought…start promoting the idea to your owners that perhaps they should read this blog and start looking for a candidate to buy.
Need advice on how to buy or be a seller? Call me…I would love a few more short term consulting engagements this year. Worried about being a seller and want to keep your shirt in a deal…call me and I will help you negotiate from strength, not weakness.
Want my stock advice…sell today and go to all cash. Wait until the fourth quarter reports start coming in, they will be awful. Barack will do something, but we don’t know what. The market will drop like a rock at first and then either stay in the tank as darker numbers are reported…and a few more “Madoff” crooks are exposed…and then if you must buy stock slowly buy back in around April, after the first quarter numbers are known, which again will be terrible.
Remember, for 2009 the goal is to survive, not try to be a hero and thrive…this is a defensive year…one in which you may have “buy” to be defensive.
- Posted: 5 January 2009
- Comments: 1
- Category: Business success
I have taken your advice and sold my relatively small holdings in the stock market. I had hoped that I would recover some of the losses. However, I see earnings reports coming in that are in your words awful. It is better to have something than nothing.
HERMAN SAYS: We lost 245 points yesterday and today Wal-Mart will lose ten percent. retail will scuttle manufacturing which will further scuttle banking as we swirl the drain. Fear not...we are starting to readjust the way we let credit run amuck. Check back into the market about April when first quarter reports show future projections.Written by Michael on 7 January 2009