“It's a recession when your neighbor loses his job; it's a depression when you lose yours.”
Harry S Truman, in Observer, April 13, 1958
33rd president of US (1884 - 1972)
The Bank of England made history last week when it cut the bank interest rate to 1.5% the lowest rate since the bank was formed in 1694. In the US even Mr Obama’s inauguration oratory promised that an activist Government would move quickly on a massive stimulus programme of public spending but at the same time asked for patience from the American people, warning that it would take time for measures to work. He made no promises that the current situation could be easily overcome and in fact emphasised the importance of the American people had to play in the changes that are needed.
During November UK industrial production saw its largest decline since 1981 (-6.9% y/y) forecasts suggest little chance of a near-term bounce in activity. New orders contracted sharply as the fear factor set-in and horns are pulled in. As a consequence unemployment figures were also hit. Input price inflation eased, but the biggest worry for firms now is demand, not costs. Weakness remains broad-based, with services and manufacturing registering negligible improvements, while construction fell to yet another record low.
However, there are still companies within the eDM, ECM & BPM sector that are continuing to grow profitably. Is it that they have yet to be hit by the credit crisis or is it something else?
I recently read a very interesting fact that more millionaires were made per capita during the Great Depression of the 1930’s than at any other time in history. How could that be? Could it be that they were the few that were not frozen by fear who did not just “stand and watch”?
Fear is the biggest killer of success. It can consume your mind and thoughts and create pictures in your head, so that you are constantly looking to where you really don’t want to go. Those who give in to fear and anxiety, become paralysed by uncertainty and confusion are likely to do two things with their hands, either sit on them and do nothing or hold them up and surrender to what they have created in their own mind as an inevitability.
The reality is that you have to work harder and you have to invest in your future. Take the recession as a time to zig when the others zag so that you will stand-out head and shoulders amongst the rest who have their heads bowed in their inevitable defeat. Lift your chin and look towards your goals. Waiting for things to change are not the actions of a winner. You need to take control of the things that are within your control. Take action that takes you in the direction you really want to travel. This recession will make others react often in a negative manner, including your competitors. What opportunity does that open up for you? That point is worth repeating:
Many of your business competitors will be paralysed by the recession so what opportunity does that give you? List them. Make a plan then take action. Activity within regarding acquisitions is still strong but we are seeing a new group of companies come to the fore. Companies looking to merge or sell may see the recession as too testing a time if they have limited resources. Companies that have cash to spend are thinking this may be a good time to act and make up ground on their competitors. I think the next year will be an interesting time for M&A in this sector and will probably surprise some of the crystal ball gazers.
93-year-old John D. Rockefeller during the Great Depression wrote, "These are days when many are discouraged. In the 93 years of my life, depressions have come and gone. Prosperity has always returned and will again."