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Perceptions vs. Facts on Covid-19

https://coronavirus.jhu.edu/map.html As of 4-23-20

Today’s post is to address the perceptions vs. facts on Covid-19 and the degree as to how serious it is…or isn’t. Caveat: We are assuming that we can trust the sources and the integrity of the data presented by the CDC and Johns Hopkins and other respected organizations. At this time, we’re not going to address the economic impact of Covid-19, as we’ll save that for another post.

So let’s address the perceptions vs. facts on Covid-19 as it relates to the severity of its contagion and mortality rates. Then we’ll be in a better position to better ascertain whether or not government and health officials are over-dramatizing it’s health implications. Let’s begin…

There are many people questioning or doubting the severity of Covid-19 as presented by government and health officials. Are they over-blowing and dramatizing its contagious and destructive power? Most of the critiques we hear from the media, politicians and protesters regarding the lock-downs and social distancing policies, (people who maybe well-intentioned or not), usually fall short in applying comparative analysis of data and statistics available. That is, they are not comparing apples-with-apples when it comes to comparing Covid-19 data vs. the death rates of other diseases as they formulate their opinions. So, do we simply take their word for it and believe what they say? Certainly not! As we always encourage our client’s and reader’s of this blog…do your own research. Get properly informed! Then we can better understand the situation and make better decisions. So let’s get on with our discussion on the perceptions vs. facts on Covid-19.

I. Discerning Fact vs. Fiction:

At GMS Business Consulting, we have one simple rule to follow as a guiding principle in business; filter out all the “noise” by looking at the data, then compare apples-with-apples, and not apples-with-oranges. Here’s what we mean:

Many people are downplaying or misunderstanding the data and the significance of Covid-19, and believe we should just “get back to work.” “Just use a little hand sanitizer and sport a mask and all is well!” Let the “healthy” people go back to work!” We would agree for healthy people to be allowed to go back to work. We are all for it…if we can be assured that each state has the appropriate testing, medical equipment, medical staffing and policies in place. Currently, we don’t have those in place. Usually these same arguments for getting back to work before the fore-mentioned policies are in place, are followed-up by using comparative mortality rates of various illnesses to substantiate their views. What’s needed, is a clear foundational perspective on what to base a comparative analysis on when using data and statistical information.

II. Annual Deaths in the U.S.

III. Leading Causes of Death Annually in the U.S.

IV. Annual Flu/Influenza Infections & Deaths in the U.S.

https://www.cdc.gov/flu/about/burden/index.html

Here’s a link and an excerpt to the CDC’s data on annual influenza: https://www.cdc.gov/flu/about/burden/index.html

  • “A 2018 CDC study published in Clinical Infectious Diseasesexternal icon looked at the percentage of the U.S. population who were sickened by flu using two different methods and compared the findings. Both methods had similar findings, which suggested that on average, about 8% of the U.S. population gets sick from flu each season, with a range of between 3% and 11%, depending on the season.”
  • Did you catch that? In any given year, approximately 8% of the U.S. population (8% of approx. 330,000,000 million people in the U.S.) equates to approximately 26,400,000 people become infected with the flu annually. Again, it’s about Perceptions vs. Facts on Covid-19.
  • The CDC estimates that influenza has resulted in between 9 million – 45 million illnesses, between 140,000 – 810,000 hospitalizations and between 12,000 – 61,000 deaths annually since 2010. This equates to an estimated mortality rate of approximately .10%
  • Remember the above mortality rate and what it’s telling us in terms of the annual deaths from the flu in the U.S. versus Covid-19. Now lets take a look at Covid-19…

V. COVID-19 Cases and Mortality by Country AS OF 4-23-20.

CountryConfirmedDeathsCase-FatalityDeaths/100k pop.
US839,67546,5835.5%14.24
Italy187,32725,08513.4%41.51
Spain208,38921,71710.4%46.48
France157,12521,37313.6%31.91
United Kingdom134,63818,15113.5%27.30
Belgium41,8896,26214.9%54.82
Iran85,9965,3916.3%6.59
Germany150,6485,2793.5%6.37
China83,8684,6365.5%0.33
https://coronavirus.jhu.edu/data/mortality
https://coronavirus.jhu.edu/data/mortality

VI. Comparing Apples-to-Apples

Annual Flu – Contagiousness:

  • CDC Link: https://www.cdc.gov/flu/about/keyfacts.htm
  • You may be able to spread flu to someone else before you know you are sick, as well as while you are sick.
  • People with flu are most contagious in the first 3-4 days after their illness begins.
  • Some otherwise healthy adults may be able to infect others beginning 1 day before symptoms develop and up to 5 to 7 days after becoming sick.
  • Remember the “average” annual contagion rate for the annual flu here in the U.S. is 8%, and a mortality rate of .10%.

Covid-19 – Period of Contagiousness:

  • According to the CDC, the contagion infection of Covid-19 can be asymptomatic with no signs of infection or flu-like symptoms for as long as 2 weeks! This means the virus can spread exponentially faster than the regular flu because seemingly healthy people are able to spread the virus with anyone they come in contact with or touch any surface in their daily life for 2 WEEKS (and perhaps longer) without ever realizing they’re infected. Based on the data provided, the Covid-19 contagion and mortality rates are VASTLY different to the annual flu!
  • As you see from the above chart, the current mortality rate here in the U.S. for Covid-19 is 5.5% vs. .10% for the annual flu! The differences in the infection rate and mortality rate of the annual flu vs. Covid-19 is very compelling.
  • So let’s calculate a hypothetical “apples-to-apples- comparison of Covid-19 “assuming” an identical infection rate as the annual flu in the U.S. (Keeping in mind that Covid-19 is actually far more contagious than the annual flu, but for hypothetical purposes, we’ll apply the same infection rate):
    • Using an infection rate of 8% on the U.S. population of 330,000,000 people:
      • Annual Flu – Infections = 26,400,000. (avg. annual)
      • Annual Flu – Death Rate using .10% = 26,400 deaths.
      • Covid-19 – Infections = 26,400,000. (using same infection rate as the flu.)
      • Covid-19 – Death Rate using 5.5% = 1,452,000 deaths.
    • That’s an additional 1,425,000 potential deaths for the same amount of infections! And we know Covid-19 is far more infectious than the annual flu due to the asymptomatic incubation time that could be as much as two weeks or longer BEFORE any symptoms become present! In other words, this makes Covid-19 55 times more lethal than the annual flu, and we haven’t even touched on the point of demographics of those who have been hit hardest by this virus.
    • Can you see why it’s important to compare apples-to-apples and not apples-to-oranges? This foundational comparison can help us better distinguish the perceptions vs. facts on Covid-19.

VI. Conclusion:

Again, assuming we can trust the sources and integrity of the data compiled by the various European countries, New York, the CDC, Johns Hopkins University and the like, it appears that Covid-19 is not like the annual flu…it’s much, much worse. Like many of you, we have family and friends who are medical professionals working in the hospitals and health centers. They can tell you their stories and experiences with Covid-19, and where the short comings of our healthcare system are. Our current medical system cannot handle much more than what they have recently faced. Consider us blessed and very fortunate! (Consider the bar chart above in comparison to other countries.) So what have we learned so far?

  • Social distancing and stay-in lock-downs, face masks, and sanitizing may be an inconvenience, but it has worked so far! Compare the difference it has made versus what the European countries have endured! New York has similar results of Europe, as they only had a 1 week lag time over Italy.
  • The main differences between the U.S. infection and mortality rates vs. the Europeans and New York, is that we had 2-3 more weeks lead-time (except New York) to prepare and put social distancing and stay-in policies in place.
  • European countries and New York also utilize mass transit far more extensively than the rest of the U.S. Had the rest of the U.S. utilized mass transit and not had an extra few weeks lead time to prepare…our current results would more closely reflect European countries. (Look at the chart above)
  • So what’s the answer? Do we continue leaving the restrictive policies in place a little while longer? Or do we prematurely open the country for business and risking a contagion and death rate that gets out of control. At what cost? Economics or lives? Who or what is your moral compass for making decisions like this? We would sure like to know the President’s and Governor’s. Fortunately, we don’t have to make that decision.
  • Our point is, can we be a little more patient and let each state reopen for business if each state’s Governor can verifyably demonstrate the following:
    • That their state has an effective Covid-19 policy in place.
    • That their state has appropriate testing standards and equipment in place.
    • That their state has the appropriate medical staffing and resources in place.
    • If the Governor of each state can attest to their constituency, then they should be allowed to reopen for business.
  • The economic effects that Covid-19 has been devastating not only in terms of magnitude, but in terms of the historical rate of speed which this has happened. Unfortunately, we have NOT begun to see the full repercussions.
  • Nor have we seen the economic impact of all the digital stimulus money being printed, and what it will bring to bear in the future months and years to come.
  • But we hope we have been able to at least present informative information to address the perceptions vs. facts on Covid-19 and the seriousness of this virus based on the statistical data provided.
  • Unquestionably, we are living in unprecedented times, but if you’re a Christian, you should not be surprised by all this. The Bible warns us of times like these to come before the second coming of Jesus Christ. For those of you who are not Christians nor have ever read/studied the Bible, perhaps now is as good a time as any to do so.
  • So what can we do? Can anything good come out of this? We’ll talk about that next week in our next post. Until then, we can all do the following:
    • We can be patient with the social distancing policies.
    • Help others who are in more need than we are.
    • Do your own research,
    • Make sure when using data/statistics to compare apples-to-apples…
    • Pray and read your Bible. You will be enlightened with His promises and comforted with His peace.
  • Until next week, be patient, stay safe and healthy.

GMS BUSINESS CONSULTING, INC. – provides lawyers/law firms, for-profit & non-profit organizations, and business professionals with Accounting Services, Business Development Services, Business Optimization Services, and Digital Marketing Services. We help business professionals strategically manage and tactically grow their businesses more effectively and efficiently.  We do NOT provide investment advice.  Contact Us  if you are interested in learning more about our services, and in particular about M.A.P. (our 3-phase business development & management solution), designed to help you strategically manage and tactically grow your business.  We would welcome the opportunity to speak with you.

info@gmsbusinessconsulting.com

707-218-3135

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Business During the CV Pandemic

Conducting business during the CV pandemic (COVID-19) will not be business as usual (obviously), but it is not only possible it’s doable! However given the right planning, preparation utilizing technology, and with measured and thoughtful precautions in place, business can proceed forward (and it must!). Most of what we’re presenting below is very basic, yet sometimes we need to revisit some of those basic principles before strategically planning ahead. Many, many business we initially interacted with were not as “up to date” on virtual working conditions nor did they have the appropriate plans in place to work through business interruptions like this current situation. Please understand, we’re not holding ourselves as experts in the coronavirus, however we do have experience and expertise in business operations, planning and optimization. Conducting business during the CV pandemic is possible! Let’s take a brief look at a few basic business interruption recommendations and precautions that might be helpful to you or someone else you may know who needs some guidance:

BUSINESS OPERATIONS:

  1. Business Interruption Plan – The first point of defense and offence is having a Business Interruption Plan (BIP). If you haven’t established and implemented a BIP by now…do so now (we can help you with this). This plan will not only be helpful now, but it will serve you well with ANY business interruption that may come along in the future including: natural disasters/ physical office location interruptions etc. (We include a Business Interruption Plan in our M.A.P. solution). BIP become the command and control center for managing and operating your business during a business interruption. If you don’t have a BIP in place, hopefully the following recommendations will provide some initial guidance and food for thought.
  2. Work Remotely – Minimize the staff necessary to be on your site location. For most service providers, online access to office/client work-product should have already been established through online/cloud access to all apps/data/communication. If that has been implemented, then those not required to be “on-site” should work remotely. For those who must remain on-site (for production purposes and tech. support), make sure to implement protective measures to keep others as safe as possible from infection.
  3. Daily Debriefs – Morning and evening business debriefs hosted by management should focus on essential business operations such as: client service & communication/ supply-chain/service providers/ contracted services status etc. Also, make sure the business leader (President/CEO/Managing Partner etc.) personally hosts a daily debrief with all staff. Staff needs to see/hear status and direction from the person in charge. This can be easily accomplished via ZOOM or other online meeting software etc.
  4. Client Communication – All staff involved in client interaction and work-product responsibilities should coordinate, prioritize and communicate with each designated client. The objective should be to keep clients informed on the status of work production that directly affects them. Clients NEED to hear from their service providers (just as we would like to hear from our contracted service providers) in situations like this. However this should be conducted on a more regular basis than is normally customary! Just a simple text/ email/ video-call/ direct phone call letting clients know you’re thinking of them, and providing them with updates regarding their work-product is very meaningful to them. DO NOT underestimate this! Over the years this has been the #1 complaint of clients with their prior service providers. This simple task can be easily accomplished via the technology tools we have at our fingertips today.
  5. Supply Chain & Service Provider Communication – Management should already have business interruption measures in place (via the Business Interruption Plan), but in case they don’t, calls must take place so that your organization’s staff can be prepared to work with any disruptions that may impact their client’s work product. Once the status and expectations with suppliers/service providers is understood, then any material information that could affect client work-product, should be communicated to the responsible staff and then directly to clients.
  6. Strategic Planning – Use business interruption situations to better understand and address your organizational weaknesses. Then you can effectively begin to strategically plan your next objectives. Host online meetings with management AND staff to brainstorm and strategize how to best resolve current business challenges internally, and how you can help clients do the same. This is a golden opportunity to add value to existing clients and new clients. Become a valued resource to help clients resolve their problems during a business interruption. Not that you need to have all the answers, but that you become a valued “resource” to help them resolve their challenges. You can do this either by providing the solution or by introducing them to other sources that can help resolve their specific challenges or opportunities. Provide value to your clients by becoming a thought leader…a problem solver other than the work you normally provide. Again, conducting business during the CV pandemic is not only possible it is doable!

PRECAUTIONS:

  1. Pre-Screening – Those employees only deemed “necessary” to work on-site during this particular crisis, should be monitored daily for any possible infection as best as possible. If any of the aforementioned on-site staff are not feeling well or have been exposed to others who are ill, they should be required to work remotely…no exceptions.
  2. Office Location Precautions – Implement the basics…mandatory use of hand sanitizers (when available), mandatory frequent hand washing, mandatory use of disposable gloves etc. Again, only those employees deemed critical to business operational support should be working on-site.
  3. Employee Support & Incentives – Consider offering “Additional Paid-Sick-Time-Off” for ALL your employees. If they’re ill or get ill, then they’ll be covered by YOU…their employer! For those fortunate enough to not get ill from COVID-19, then let this “additional” paid sick-time-off be added to their vacation time. Either way, now would be the time to step-up to the plate and let your employees know you care about them and their livelihood. The additional benefit will come back to you in the form of employee retention.

We hope these basics will be of help to you or someone you know and that you can be reassured that conducting business during the CV pandemic is doable! If you would like to discuss your particular situation further please feel free to Contact Us. Be well, stay safe, and may the Lord protect us.

GMS BUSINESS CONSULTING, INC. – provides lawyers/law firms, for-profit & non-profit organizations, and business professionals with Accounting Services, Business Development Services, Business Optimization Services, and Digital Marketing Services. We help business professionals strategically manage and tactically grow their businesses more effectively and efficiently.  We do NOT provide investment advice.  Contact Us  if you are interested in learning more about our services, and in particular about M.A.P. (our 3-phase business development & management solution), designed to help you strategically manage and tactically grow your business.  We would welcome the opportunity to speak with you.

info@gmsbusinessconsulting.com

707-218-3135

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OUR FINANCIAL OPIOID ADDICTION – IS DEBT!

Our financial opioid addiction is debt! Record household debt is at an all-time high. Does it matter? Our national debt is at a record high. Does it matter? What does this mean to you and me, and for our country? Read further then you decide for yourself…

According to these articles on MarketWatch and Bloomberg, household debt exceeded $14 TRILLION dollars by the end of 2019. According to these articles, this past quarter was the 22nd STRAIGHT quarterly increase in consumer debt! Mainstream business news pundits claim the economy is strong, and that consumer purchasing is strong etc. It makes me ask, what business school did they attend? What business principles are they applying to come to these conclusions? These pundits appear to be bright, articulate, well-educated and sincere people…and I’m sure they are! But what do they see that I don’t see or understand that I don’t understand? Let’s look at the strength of the consumer and our overall economy from a macro perspective so that we can better understand the underlying principles of this s0-called economic “strength” that mainstream media pundits claim.

FIRST:

Let’s assume that we can first agree on one basic principle that debt is debt. Debt means that you owe money for an item you purchased… you do not own that particular item/asset until it is paid off. If you can’t afford to buy something outright, then debt it taken on because in most cases one doesn’t have the financial means to make an outright purchase of an item or asset, rather you have reserved the right to take possession of that item or asset until that item has been fully paid for…then you have actual ownership. You may have “reserved” title of ownership such as in your home or the car you drive…but you don’t actually own it until it is paid off. (Try missing 2-3 payments then you’ll quickly understand who the owner is and who the debtor of that asset really is.) Have we forgotten this basic principle? In some cases, debt may be assumed by individuals to charge an item in order to gain the mileage points or whatever incentive is being offered. (I too have done this myself in order to obtain additional discounts on the items I was purchasing…but then I paid off the balance completely when the first bill came due. I no longer carried that debt, and in those situations, short-term debt can make good financial sense.) But that’s not what we’re talking about here... The $14 TRILLION in consumer debt has obviously not been paid off, rather it has steadily increased each quarter for the past 22 quarters. What does that tell you? As consumers and as a nation, we are in the midst of a financial opioid addiction.

This record amount of consumer debt tells us, that rather than consumers paying off debt, the consumer’s debt continues to grow. Why? Well, for several reasons; credit is continuously being extended, wages aren’t keeping up with inflation, and we are living beyond our means. Thus, financial opioid addiction! This continuous growth in consumer debt keeps fueling this “ponzi scheme” of the American economic mind-set. This will eventually lead to the ultimate destruction of the consumer’s future financial well-being. Pundits say the consumer is confident and is therefore spending more. Should they be? If they are so confident, then why take on more debt…more servitude to debtors rather than paying down the debt already owed, and loosen the financial bonds that will further strangle them when the next financial crisis hits?

SECOND:

Consumer debt is simply a mirror image of the mind-set of the U.S. national debt, which is currently at $23.2 TRILLION (according to the U.S. Treasury). The highest in world history. Why is this? Because currently, the U.S. still maintains the “World Reserve Currency”…meaning we can print all the money all we want or need (digitally and physically), while the rest of the world cannot. We’re able to finance (issue debt/ create money out of thin air/ for anything we want militarily, financially, infrastructurally, you name it (at least we can for the time being). The U.S. Government and consumers alike are suffering from financial opioid addiction…period. As American consumers, we have become accustomed to buy whatever we want, whenever we want without forethought of what it means to our financial future. So the pundits state that our the economy the most powerful/prosperous in the world. Is it really? Or is it because we carry the highest amount of debt of any other nation or people in the history of the world? It sure sounds like borrowed materialism and prosperity without paying for it! We just keep kicking the financial opioid debt down the financial highway of destruction. Have you ever considered if all debt was called in immediately or if the taps to this opioid debt were suddenly cut-off? What would happen to this nation…to us individually? We would be bankrupt (we already are). The rest of the world just playing along… Take a look below at the U.S. Debt Clock as of 2-11-20, the U.S. national debt. Is this the proof of prosperity or indebted fake prosperity?

Our economy and our consumers alike have “seemingly” flourished because we have access to a never-ending source of debt. One problem: Someday this situation will come crashing to an end, and unfortunately we as a country and individually as consumers will have to live through those consequences. But until then, keep the economy going! Spend, spend, spend! Come on consumers, do the American thing… keep on spending and taking on more debt… it’s what comprises two-thirds of our economy! Is that really economic strength or is it economic weakness? Is that what we really represent to the world? As a Christian nation founded on Christian values and principles, is that what the Bible teaches us?

Have you ever thought of what would happen if/when the “World Reserve Currency” status is taken away from the U.S.? OR…when the rest of the world no longer recognizes the U.S. dollar as the world reserve currency? Have you ever thought of that? What it would be like for you/ your children/ or your grandchildren when that day comes, and we can no longer digitally or physically print as much money as we “want or need” to service our debt? Considered what it will mean financially to our country, to you and your families? I would encourage you to give some critical thought to that for moment…it’s pretty sobering.

THIRD:

What will happen to the U.S. consumer when the next economic downturn happens… when credit is once again tightened/ or reduced/or restricted and we can no longer charge or incur debt to pay for items we want or NEED? My point is… for many of us, our personal and national financial condition is built on DEBT. When this financial house of cards begins to fall, when this financial ponzi-scheme begins to implode, those with debt will suffer the most. Consider this article from Bloomberg this morning regarding Fed Chairman Powell’s comments on the next economic crisis… Will the Federal Reserve have enough ammo to fight the next recession? My question to each of us is, will we individually have enough financial ammo in our personal arsenal (savings and owned assets) for us to survive the next recession?

CONCLUSION:

It may be worth considering, that with the stock market at all-time highs, the bond market near all-time highs and the real estate market at all-time highs, wouldn’t it be prudent as a consumer to tighten our spending and reduce our debt rather than increasing our debt? Perhaps for those with some market investments to consider reducing their market investment exposure, and take some of the profits and use them to pay-down debt? Remember the wise old saying, “Buy low…Sell high” that generations before us better understood?

For those who don’t have investments to liquidate and apply the gains to pay down debt, perhaps they can begin to implement a debt pay-off plan vs. purchasing the newest smartphone (avoiding brand names) or other like-kind spending choices? As mentioned earlier, we have become consumers and a nation of the financial opioid called debt. We’re addicted and we don’t seem to care too much about that right now or at least we won’t until the opioid is someday taken away. Wouldn’t it be wonderful for us to change the mindsets of financial pundits from expressing that it’s good that consumers are “spending” (i.e. taking on more debt), to consumers are now saving and paying down debt, therefore reducing their servitude to debtors? Will our economy grow more slowly, yes. But as a nation and individually we will be financially stronger, enabling us to better weather the next financial storm that lies ahead, and begin to shed our financial opioid addiction to debt.

GMS BUSINESS CONSULTING, INC. – provides lawyers/law firms, for-profit & non-profit organizations, and business professionals with Accounting Services, Business Development Services, Business Optimization Services, and Digital Marketing Services. We help business professionals strategically manage and tactically grow their businesses more effectively and efficiently.  We do NOT provide investment advice.  Contact Us  if you are interested in learning more about our services, and in particular about M.A.P. (our 3-phase business development & management solution), designed to help you strategically manage and tactically grow your business.  We would welcome the opportunity to speak with you.

info@gmsbusinessconsulting.com

707-218-3135

GMS Business Consulting No Comments

Is Blockchain Dead?

Swirld.com

Is Blockchain Dead? That’s the question that this Article on Bloomberg addresses and this Lecture about the future of money (blockchain, crypto currencies, fiat currencies) by Jim Rickards attempts to answer. We believe that although Blockchain has many merits, we also believe it has many limitation too. The limitations are particularly obvious when it comes to using Blockchain as the foundation technology for crypto currencies like Bitcoin. Bottom line, Blockchain doesn’t have the horsepower nor technology capabilities to continue supporting crypto currencies in our vast global financial system. That said, there is a technology that can handle the demands of a global economy. That technology is called Hashgraph (look at our POST back on February 5, 2018).

The topics of Blockchain and Hashgraph technologies and Crypto Currencies should be of importance for individuals and more important to businesses. Understanding these technologies and how to better utilize these technology issues will impact the businesses we operate and will ultimately impact our lives in the future. That said, we don’t feel the need to rewrite our position on these topics (Blockchain, Bitcoin and Crypto Currencies) as we previously covered these topics in our POST back on February 5, 2018. The background of these technologies and their implications are thoroughly discussed in the interviews we included in the post.

As we mentioned back in February 2018 and we continue to believe today, HASHGRAPH is/will be the leading technology going forward…not Blockchain technology. We hope you will find this post/and previous post (February 2018) to be insightful and helpful. Remember, do your own research. Then make better informed decisions. We’ll look forward to posting again soon!

GMS BUSINESS CONSULTING, INC. – provides lawyers/law firms, for-profit & non-profit organizations, and business professionals with Accounting Services, Business Development Services, Business Optimization Services, and Digital Marketing Services. We help business professionals strategically manage and tactically grow their businesses more effectively and efficiently.  We do NOT provide investment advice.  Contact Us  if you are interested in learning more about our services, and in particular about M.A.P. (our 3-phase business development & management solution), designed to help you strategically focus and tactically grow your business.  We would welcome the opportunity to speak with you.

info@gmsbusinessconsulting.com

707-218-3135

GMS Business Consulting No Comments

Interest Rates Tell the Story…an Update

This is an update to “Interest Rates Tell The Story” which we posted on June 24th of this year. We wanted to post this lecture by Danielle DiMartino Booth of Quill Intelligence., as she addresses some very important points regarding interest rates and the “real” stat of the economy and financial markets. Danielle gave this lecture at the Stansberry Conference on October 20th, 2019 in Las Vegas, Nevada.

As a former insider at the Federal Reserve in Dallas for nearly 10 years, and many years experience working on Wall Street, we believe it would be of value to our readers to LISTEN to what she has to say. More specifically about what Danielle has to say about interest rates, the state of the economy, the Federal Reserve, and finally on how all this information can be used in making strategic and tactical decisions for you personally and professionally. Remember, interest rates tell the story of what’s really going on in the economy. As we always say, “Do your own research, then make better informed decisions.”

GMS BUSINESS CONSULTING, INC. – provides lawyers/law firms, for-profit & non-profit organizations, and business professionals with Accounting Services, Business Development Services, Business Optimization Services, and Digital Marketing Services. We help business professionals strategically manage and tactically grow their businesses more effectively and efficiently.  We do NOT provide investment advice.  Contact Us  if you are interested in learning more about our services, and in particular about M.A.P. (our 3-phase business development & management solution), designed to help you strategically focus and tactically grow your business.  We would welcome the opportunity to speak with you.

info@gmsbusinessconsulting.com

707-218-3135

GMS Business Consulting No Comments

PENSION CUTS – THE HEADWINDS AHEAD…

General Electric – Cutting Pension Benefits

Pension Headwinds Ahead is the title for today’s post. As most of you know already, many of the largest pensions here in the U.S. are in deep trouble. With under-funded reserves coupled with low interest rates and declining contributions, for many pension funds, the outflow is greater than the inflow.

We first saw the reality of this situation coming to a head back in 2015. Central States Pension Fund (with over 410,000 employees) applied for benefit cuts. (For a sample listing of pension funds that have applied to cut benefits under the Multiemployer Pension Reform Act click HERE.) Today, according to Bloomberg News, General Electric (GE) announced that they are “taking steps to cut the worst pension deficit in corporate America, by freezing benefits for more than 20,000 employees.” If you think this is just an anomaly, think again. We believe this is only the beginning as pension costs continue to rise, and interest rates near their historical lows, this is just the beginning of additional ones to follow.

This situation is very straight forward. The cash outflows are simply greater than the inflows. As fewer people pay into the pension funds and an increasing number of new retirees begin collecting their pensions, the outflow exceeds the inflow. In addition, with interest rates so low, the investment income received isn’t nearly enough to cover the outflows either. It’s a perfect storm for pension funds.

To better prepare retirees relying on fixed pensions, we recommend they fully inform themselves by taking the following action steps:

  • 1st – Check the status of your pension fund. Do your research if their pension fund has applied for benefits cuts under the Multiemployer Pension Reform Act.
  • 2nd – Meet with your accountant and financial adviser to proactively plan, budget, and make any investment re-positioning for possible pension cuts in near to medium future.
  • 3rd – Reduce your debt…period. Streamline and cut unnecessary expenditures. Seriously consider downsizing your current lifestyle to better position yourself for any unseen pension reductions in the future.

It’s far better to develop a plan and implement now, rather than waiting and being forced to do so at a later time. Remember, it’s up to you to do your own research, then make better informed decisions.

GMS BUSINESS CONSULTING, INC. – provides lawyers/law firms and business professionals with Accounting Services, Business Development Services, Business Optimization Services, and Digital Marketing Services to help business professionals successfully manage and grow their businesses more effectively and efficiently.  We do NOT provide investment advice.  Contact Us  if you are interested in learning more about our services, and in particular about M.A.P. (our 3-phase business development & management solution), designed to help you strategically focus and tactically grow your business.  We would welcome the opportunity to speak with you.

info@gmsbusinessconsulting.com

707-218-3135

GMS Business Consulting No Comments

FACEBOOK – ANOTHER DATA POLICY FAILURE

Source: Bloomberg

This is yet another example of Facebook’s failure to transparently disclose its data policies to its customers. Hello Readers!

This time, according to Bloomberg news, it has to do with outsourcing to “hundreds” of outside contractors transcribing its “Messenger Chats” into usable data (that is…for them to sell/mine or whatever their lack of transparency data policy allows them to do). Were you aware of this policy? Facebook says it doesn’t listen to your conversations, rather they hire hundreds of outside contractors to do this for them. Well isn’t that really the same thing? Of course it is. Facebook’s lack of transparency and abuse of client’s data is abysmal and disingenuous to say the least. That said, I have questions regarding these outside contractors hired by Facebook to do their dirty work, namely:

  • Who are these outside contractors?
  • What are their data policies?
  • What do they do with your data once service is rendered for Facebook?
  • Where are they located?
  • Who is monitoring these contractors?
  • How do they safeguard your data?
  • Do they adhere to their data policies?
  • How do you know? How is this verified?
  • Who monitors their data data retention policies…in other words, who is holding them accountable for YOUR private data?
  • Certainly not Facebook!

Once again, Facebook has proven that they can’t be trusted with the privacy of their client’s data. This is evidenced by their lack of transparency and lack of full disclosure to their clients in their data policies. Resulting in yet another reason for customers to close accounts at Facebook and send a message to their senior management. However, I don’t believe they really care about what you or I think…they’ve haven’t so far, so why should they change their stripes now?

If you don’t agree with Facebook’s customer data policies, then take a stand and make your voice heard. If you don’t really care about how your data is used without your approval or knowledge, then continue to have your account open at Facebook where your private data can be bought/ sold/ exchanged/ shared/ and traded with hundreds of data contractors who can do the very same thing with your private data if they have similar data policies in place! You can’t say you haven’t been warned!

GMS BUSINESS CONSULTING, INC. – provides lawyers and business professionals with Accounting Services, Business Development Services, Business Optimization Services and Digital Marketing Services.  We do NOT provide investment advice.  If you are interested in learning more about our consulting services, especially our M.A.P. solution (a Master Action Plan), designed to help business professionals to strategically manage and tactically grow their business, then Contact Us… We would welcome the opportunity to speak with you.

info@gmsbusinessconsulting.com

707-218-3135

John 14:15

GMS Business Consulting No Comments

Interest Rates Tell The Story…

US Interest Rates 6-13-19 Source: Bloomberg

Interest rates tell the story… Good morning readers! Do you want to know where the economy is heading, where the stock market is going, the overall health of the economy? Just follow the interest rates and their upward or downward direction.

How does this affect you as an individual and as a business owner? It affects your personal income and business income, as upward and downward movements in interest rates create both challenges and opportunities. This is pretty basic for most of you. However, we’re going to highlight some interest rate basics below, to help you understand a few charts we’re about to display in a few minutes. But first, here are the basics:

Interest Rate Impact:

  • Rising Interest Rates – As interest rates begin rising, it’s usually due to one or more reasons:
    1. The economy is heating up, and inflation becomes a concern, so the Federal Reserve increases interest rates to help keep inflation under control. Or…
    2. The local currency is weakening against other leading currencies. So, interest rate increases may be used by the Federal Reserve to prop-up the local currency (too deep for this posting). Or…
    3. Wall Street/or world financial markets indicate that they see an overheating economy, thus urging central banks to raise interest rates.
  • Lowering Interest Rates – As interest rates begin declining, it’s usually due to one or more reasons:
    1. The economy is slowing down and verging on recession or is in the midst of a recession, and inflation concerns begin to lessen, so the Federal Reserve may lower interest rates to help the economy avoid further decline and begin stimulating the economy towards positive growth. Or…
    2. The local currency is gaining too much strength against other leading currencies, thus impacting its ability to export goods and services. So, interest rate decreases may be used by the Federal Reserve to weaken the local currency to help encourage its exports to foreign countries (too complex for further discussion in this posting). Or…
    3. Wall Street/or world financial markets indicate that they see a declining economy, thus urging central banks to lower interest rates.

From a Personal and Business Perspective:

  • PERSONAL PERSPECTIVE:
    • Existing Loans – As interest rates increase or decrease, any adjustable loan payments you have may adjust either upward or downward in accordance with the direction of interest rates. Thus making your loan payments either higher or lower (pretty obvious).
    • New Loan Qualification & Payment – Your personal income may be affected positively or negatively by any future loans you may be considering or may qualify for (such as home, auto, or personal loans), making your monthly loan payment either more or less expensive in accordance with the direction of interest rates (pretty obvious too, right?).
  • BUSINESS PERSPECTIVE:
    • As interest rates increase or decrease, business loans etc. become more or less expensive, thus affecting the business cash-flow positively or negatively (obvious once again).
    • As interest rates increase, the other costs of business usually increase as well. This reflects an expanding economy where the costs of doing business increase due to an increasing demand for materials and services out-pacing existing supplies.
    • As interest rates decrease, the costs of conducting business tends to decrease as well. This reflects a slowing or contracting economy that may be either going into a recession or may already be in a recession. This is simply due to the supply of materials and services outpacing demand.

Once Again… Interest Rates Tell The Story:

Let’s now look at the charts below, beginning with interest rates here in the U.S. What story does this chart tell YOU, and how will they impact you personally and professionally?

US Interest Rates – 6-13-19 Source: Bloomberg

Let’s now take a look at Interest Rates in the UK…

UK Interest Rates 6-13-19 Source: Bloomberg

Lets now look at interest rates in Germany (Europe’s leading economy)…

Germany Interest Rates 6-13-19 Source Bloomberg

Finally, lets take a look at interest rates in Japan…

Japan Interest Rates 6-13-19 Source: Bloomberg

So, have you noticed a common theme among the “leading” economies of the world when it comes to interest rates? Interest rates are near all-time lows! What does this signify to you? Eleven years after the 2008 – 2009 financial crisis, interest rates here in the US are still near historic lows, and the next two leading economies (behind the US), are even lower. In fact, they are at negative interest rates. It is sometimes explained as an incentive for banks to loan money because depositors will hoard their cash…is that so?

We believe negative interest rates may also reflect something vastly different. Perhaps that the underlying condition of the economy is fragile…very fragile. The economy would have to be very fragile in order to bring interest rates near all-time lows, correct? Then…perhaps to encourage banks to loan money they could take rates lower in order to incentivize lending. But the lending couldn’t be the key reason why interest rates would drop so low. It has to be that the sate of the economy is in such a fragile state that rates needed to be lowered in effort to stimulate a failing economy. We believe that’s the real reason why central banks are lowering interest rates drop so low. They may be out of tricks to keep the world economy running on runaway debt that can never be paid back.

Look at what has happened to Japan over the past two decades? Is this signaling what could happen here in the US? In either case, our point is, that current interest rates on a global levels do not reflect healthy economies nor a healthy financial system. If that’s the case, then how do you prepare yourself personally and professionally? That will be the subject of our next post in several weeks. Until then, do your own research and give this issue some critical thought. It may affect your near-term and long-term planning both personally and professionally. Remember, Interest rates tell the story…what story are they telling you?

GMS BUSINESS CONSULTING, INC. – provides lawyers and business professionals with Accounting Services, Business Development Services, Business Optimization Services and Digital Marketing Services.  We do NOT provide investment advice!  If you are interested in learning more about our consulting services, especially our M.A.P. solution (a Master Action Plan), designed to help business professionals to strategically manage and tactically grow their business, then Contact Us… We would welcome the opportunity to speak with you.

info@gmsbusinessconsulting.com

707-218-3135

John 14:15

GMS Business Consulting No Comments

A FACEBOOK FOLLOW-UP…

Zuckerberg Knew of ‘Problematic’ Privacy Practices, WSJ Says

A Facebook Follow-up
Mark Zuckerberg Photographer: Marlene Awaad/Bloomberg

A FACEBOOK FOLLOW-UP for our readers… We have posted several articles regarding Facebook and its lack of oversight and data privacy policies regarding customer data. We thought this article posted on Bloomberg as reported in the Wall Street Journal speaks to Mark Zuckerberg’s knowledge of data policies and might be of interest to you.

A Facebook Follow-up question for you: Have Americans compromised their ethics and moral values all for the sake of money? By supporting Facebook and it’s President Mark Zuckerberg it sure seems like we have. Does making excuses for Facebook and overlooking Mr. Zuckerberg’s lack of integrity, leadership and oversight reflect a change in our country’s moral compass? Are we personally compromising our integrity and moral values as a people, for the sake of the “almighty dollar”? It would certainly appear so…

Many Americans continue supporting Facebook, despite all the evidence of compromising policies and its customer data in lieu of profits. So, what does that say about us individually and as Americans? Do we value Facebook’s social conveniences and business generating capabilities at the expense of ethics, data policies, customer care, leadership and trust? Have you?

GMS BUSINESS CONSULTING, INC. – provides lawyers and business professionals with Accounting Services, Business Development Services, Business Optimization Services and Digital Marketing Services.  We do NOT provide investment advice!  If you are interested in learning more about our consulting services, especially our M.A.P. solution (a Master Action Plan), designed to help business professionals to strategically manage and tactically grow their business, then Contact Us… We would welcome the opportunity to speak with you.

info@gmsbusinessconsulting.com

707-218-3135

John 14:15

GMS Business Consulting No Comments

Bitcoin and Blockchain For Lawyers

Bitcoin & Blockchain For Lawyers should be considered thoughtfully before implementation. A recent blog post by the law firm software management firm, MyCase, presents a clear (yet basic) description of how Bitcoin and Blockchain technology may work together in terms of payment receipt by lawyers and law firms for services rendered. We have concerns that we would like to share with you…

FIRST – Our Concerns About Bitcoin:

  • Bitcoin has no official oversight body to ensure against fraud and cyber security threats (other than a fictitious name, Satoshi Nakamoto), there is no record of ownership/creator/overseeing entity…nothing! So who or what is really behind this crypto currency? This may be changing though according to an article on Bloomberg. Crypto currencies may be facing their biggest hurdle yet…
  • Bitcoin is backed by nothing…just people agreeing that it has “some” form of value…an intangible value based on what? This can also be said about our current fiat currency system in existence today. However, there is one key difference. At the end of the day, the U.S. currency and other world currencies are backed by the “full faith and credit” of their respective government. Yes, that too can be questionable as to the economic soundness of any particular country. However the government does take responsibility to oversee and manage the stability of their currency through their central banks. This oversight effects all persons not only of the issuing country, but transactions using that currency world-wide.
  • Bitcoin does not work like most recognized/accepted currencies around the word. One can’t transact with it all over the world or in ordinary day-to-day transactions as you would using your debit or credit cards because not everyone accepts Bitcoin as a legitimate exchangeable form of currency. The challenge that Bitcoin and most other crypto currencies face is, that almost nobody accepts nor uses these crypto currencies on a daily basis for business or personal financial transactions…see this article from Bloomberg.
  • Bitcoin in its current state is completely unsustainable as a crypto currency, in its current form to be used on a global scale in day-to-day transactions (using Blockchain technology) based on the IMMENSE amount of energy required to mine/produce one Bitcoin. It’s completely unsustainable in its current state. (See points below on Blockchain vs. Hashgraph technology below.)
  • In addition, most of you know that Bitcoin is EXTREMELY volatile! As of today’s posting (06-04-19), Bitcoin is up approximately 35% over the past month (from $5612 to approximately $7607). However, for the past week it is week it is down nearly 10% (from $8536 to approx. $7607). So as an attorney or business professional, when do you convert to US dollars? On any given day it can be up or down significantly. You could either make or lose a lot of money depending on the day of conversion to U.S. dollars. Is that how you want to operate your business cash-flow?
  • We would suggest to lawyers and business professionals to carefully consider the risks of accepting Bitcoin as payment currency for services provided until the crypto currency itself stabilizes (it may or may not). If you want to use Bitcoin in your personal life as a speculative investment, then that’s your choice. Question…do you believe you have the experience/expertise/tools/and the time needed to competently and successfully trade Bitcoin and make a profit? Perhaps you do, and if so, good for you. Proceed with caution…and keep in mind the chart below on Bitcoin’s pricing history:

SECOND – Issues with Blockchain Technology & Crypto Currencies:

It’s true that Blockchain has many, many capabilities. In fact, Fintech News posted an article that major central banks around the world are “exploring” crypto currencies using Blockchain technology. The “key word” is “exploring”…not implementing. See Article HERE or click the picture below:

Fintech News
  • Blockchain, is considered by many to be “the technology” of the future used for crypto currencies. Blockchain technology has many exciting uses for future business application. However to be used as “the technology” engine behind crypto currencies, there is one key challenge that makes Blockchain an unlikely solution:
    • From a capacity standpoint, Blockchain lacks the robust number-crunching capabilities needed to handle the vast amount of financial transactions processed in the financial world in reasonable time periods for businesses and consumers.
  • Based on our research, Hashgraph technology, (not Blockchain technology) will likely be the technology used to support mainstream crypto currencies going forward. The reasons why Hashgraph will likely be used, and how it compares to Blockchain is too lengthy a discussion for this post. So please see our next point below…which takes you directly to some expert sources comparing these technologies.
  • For an extensive look into Blockchain vs. Hashgraph technology, please refer to our February 2018 post on “Hashgraph vs. Blockchain.” Listen to what the experts have to say regarding these technologies and how they compare and deal with the needs and challenges of crypto currencies going forward. Then come to your own informed conclusions as we have.
Swirld.com

OUR CONCLUSION:

Blockchain has its place in the world today and is extremely valuable! Hashgraph technology also has its place in the world today and for the future in business and financial applications that will effect us personally as well. In our humble opinion, Hashgraph may completely replace Blockchain as the technology of choice used for driving the future of crypto currencies. That said, we won’t be so narrow-minded to say we won’t be swayed that other technologies being developed can’t be used in future crypto currencies either. That said, the arguments/facts presented by the experts in this field (from our February Post) are very compelling. As for us, we’ll keep accepting payment for our services directly in U.S. dollars, without the extra step and financial risks of currency conversion. We hope you find this post to be helpful and insightful in making your business decision as to accepting Bitcoin for the services your law practice provides.

GMS BUSINESS CONSULTING, INC. – provides lawyers and business professionals with Accounting Services, Business Development Services, Business Optimization Services and Digital Marketing Services to help business professionals successfully organize, grow and operate their businesses more effectively and efficiently.  We do NOT provide investment advice.  Contact Us  if you are interested in learning more about our services, and in particular about M.A.P.(our 3-phase business development solution), designedto help you strategically focus and tactically grow your business.  We would welcome the opportunity to speak with you.

info@gmsbusinessconsulting.com

707-218-3135

John 14:15