Cash Flow: Cost of Success, Price of Failure

This post was written by Yon on September 21, 2011
Posted Under: Uncategorized

This post is in response to the g+ thread here: https://plus.google.com/102871123574468799566/posts/HqzaYqHh4ga#102871123574468799566/posts/HqzaYqHh4ga


Reflecting on this thread, I have a sense of wonder. Everyone here “knows” the answer, yet we don’t have clear agreement on it. I’m realizing the opportunity here… we can certainly continue to offer our perspectives outward as a gift to others to perhaps inspire them to see this issue in new ways, the second half of the opportunity is even more powerful and valuable. It comes with the recogition of “I would like to expand my viewpoint and become MORE correct”. To do so, I must first become WILLING to see a different perspective. (pause) Introspecting on this I see I am willing.
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I’d like to offer you my perspective, and then allow you to help me refine my understanding (ie, show me how my position could be improved). If we approach this task in the correct spirit, we both grow.
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Situation: People are experiencing reduced cash flow and would like to increase their cash flow.
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To overcome this situation, we look at principles of cash flow: cash flows based on mutually beneficial VALUE EXCHANGE.
examples:
– Employers “create jobs”/”higher employees” because both employer and employee feel better off as a result of the exchange (employee’s time/energy/talent/skill/thought for employer’s money/benefits).
– Customers “buy the product” because the customer believes that buying the product is the best use of his/her money. (sales is the action of building up in the mind of the potential customer the vision/belief that the customer will have made the absolute best use of his/her dollars.)
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For an individual to increase his/her cash flow (income), it is necessary to PROVIDE MORE VALUE (do business with more customers, do larger business with existing customers, provide dramatically more value to an employer, create a new employment relationship that can appreciate the higher levels of value that you provide.)

The reason we are facing this situation is that in the past few years a number of dynamics are all occurring simultaneously:
– individuals have reduced the ratio of spending to earning (ie stopped using consumer credit)
– individuals have have reduced earnings (unemployment, decreased profits)
[these two are the basis for Keynesian economic theory – “stimulate the economy by increasing liquidity”]
but consider the other dynamics:
– new technologies allow individuals/companies to provide HIGHER VALUES (as a result, those that are INCREASING the level of value they provide [and/or decreasing costs] gain market share). This means that EVERYONE must step up and provide higher levels of value in order to be competitive, or else the dollars flow to those at the top, those that provide the highest levels of value.
– government/political/economic instability (lack of confidence of individuals to know how things will play out – and the largest human variable in this is now government regulation: understand that in competitive business a small shift in profit margin can result huge shifts in market share, and in a few months or years that shift can result in tragedy or windfall market domination. When politicians [not bound by insider trading regulations] are able to pass laws “to protect consumers” and write the laws so that compliance for their politically connected friends is immediate and compliance for the competition is …less than immediate, it’s just a matter of time before the politically connected own the assets and market share of the competition that either lost or didn’t play the game of political pull.
– (note: this list may not be complete)
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each of these dynamics (and others that could be add) offers a number of actions that could be taken to improve the situation:
a) give more credit to individuals?
b) demand employers pay higher wages?
c) shut down the internet? seek to create technology equality/ subsidize smart phones and computers? give out grants to help companies that are at a technology deficiency to be competitive?
d) institute more regulations to control lobbyists, control mergers and acquisitions, create more committees to review all consumer protection laws?
yuck!
yet each of those courses of action seem to be justified based on the dynamics. But they each actually negatively affect the economy!

Here are my real solutions:
1) create a new kind of social interaction that acknowledges that “if you continue to do/think what you have always done/thought, you’ll continue to get what you have always got.” –> We want something BETTER than what we have now. It’s time to ADJUST SOCIAL PERCEPTION. The social pressures/programmings insist that “being productive is not fun” and “you need to relax/unplug/escape to stay sane.” In reality, IT IS HUGELY ENJOYABLE TO BE PRODUCTIVE! and FACING/CONFRONTING REALITY is both REWARDING and BENEFICIAL —> Individuals who CHOOSE to trade their TVs for personal development in some form are on the right course. More and more people are coming to the realization that it is time to give up Football, give up Prime Time, give up video games, give up distractions, and IT IS TIME to figure out what we can do to improve things for our family! –> part of this will likely involve either: a) getting a second job, or b) engaging in a business of your own.

2) Individuals, to survive, must increase their PERSONAL VALUE TO OTHERS, and they must also seek to HAVE THEIR INCREASED PERSONAL VALUE be REALIZED. (it is not enough to read a book, you must also DO SOMETHING with it, so that others are positively benefitted as a result. Learn something NEW! and USE IT!

3) Prepare for the jobs of the future. The jobs of the future (just my vision, feel free to disagree) are Entrepreneurial! I envision companies moving away from having employees trade ‘time for money’, and they will desire to have contractors that trade ‘results for money’. Already you see this with affiliate marketing on the internet. There are THOUSANDS (possibly millions?) of products that you can promote and get paid on a “per sale” basis. I would expect that sales and marketing positions will continue to go in this direction for a long time. Product development has also started going this direction, where those who are able to develop products position themselves as service providers which are contracted: “can I get you to quote me for a widgit that will meet these requirements.” “certainly”. This model rewards the highest levels of competence and resolves conflicts of interest (engineers not properly incentivized to deliver).

4) At a federal government level, allows states the freedom to be different and unique, just as the constitution originally intended. The Federal Government is limited to the explicit enumerated powers and jurisdictions, and the states have total freedom except that no state shall pass laws that encroach on the rights ensured by the Bill of Rights. Some states would choose to remain exactly as they are, others would attempt innovation. Some would strive for stability and say, “We will not change, add to, or subtract from any of our business laws at all for the next 10 years.” Some states would go all out capitalistic, others would socialistic or communistic or corporatistic, others libertarian. People would move to the states that they liked best. They would move where the jobs are, or they would vote to make their state more competitive to attract higher quality jobs and people.

5) Understand the reality that right now there is a massive consolidation of wealth in the hands of the very few (because of a number of manipulations, the most significant being the Federal Reserve making Trillions of dollars in private loans to their politically connected cronies at the expense of the buying power of the US Dollar). Those who have money will want ways to leverage their capital for their personal benefit and for the realization of their goals and dreams. (And this is really interesting, because what the ultra elite want is not obvious to the rest of us: do they want power/control, do they want money, do they want life on earth to flourish and prosper, do they want fame, do they want accolades, do they want to live forever, do they want to experience all manner of craziness? Is it ‘selling your soul to the devil’ to help them? Are they noble and benevolent and want this civilization to soar to new heights? Do they think of us as “useless eaters” and want us to stop consuming “their” natural resources?) Every person who figures out what these ultra rich actually want, and who is willing and able to participate, will receive massive flows of wealth, because the reality is that it is very difficult to spend a TRILLION Dollars (imagine trying, it’s fun, and frustrating: ie, really, how many space stations do you want?) – Unfortunately when you start to look into this, it starts to seem that at least many of these individuals do not have the best of intentions for the rest of us. Fortunately, there are a few that want more than to own it all.

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As individuals, we have the ability to control our own lives. What are you doing to make your life better? Would you be interested in network with other like minded individuals that are trading in the the distractions of the past for productivity and happiness and hope here and now and in the future? It’s available. Like in any competitive sport, when your personal responsibility level reaches a certain point, you can’t help but leave behind one league and step up into a new arena with a higher level of competition. Those who stay behind will attempt to hold you back; they invite you back to engage in the old distractions and remember the good old days. In reply we say, “Thanks for the offer, I’ve actually got some really exciting things going on, if you’d like to see, I’d be happy to share.” But eventually, we leave behind the old, and make the shift to the new world.

The future is VERY BRIGHT for those who have stepped out of the collapsing trap of misery and hopelessness. It’s a transition that doesn’t happen automatically. It is a conscious choice. It is a leap of faith. It is a releasing of old and unneeded comforts.

The cost of success is nothing compared to the price of failure.

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