Stock markets tank

Stock markets all over the world have been falling. Investors (speculators) who were participating on the stock markets have booked huge losses or are sitting on equity that has little or no value.

How did this come about?

Mindless lending in US to the housing market created a housing bubble. Property prices rose as bankers and mortgage lenders offered money to just about anyone to buy a house. People with little or no capital bought houses (sub-prime borrowers) with the sole intention of selling them when the prices rose. Banks and Mortgage lenders lent money with holidays on principal payment and deferred payment plans. While the prices were rising, everyone made money.

Then suddenly prices stopped rising and payment holidays ended. People who had no income and no prospect of selling the house to the next fool walked away from them. Banks were left holding the property as most of the loans were no-recourse loans. With more people selling, property prices collapsed having a domino effect of all markets. Banks that had lent money were forced to book losses under the 'Mark to Market' accounting standards. Capital erosion was the order of the day and rating agencies down graded credit papers issued by investment banks and other banks thus reducing them to junk status.

Banks had no option but to raise money when none was available. Confidence has hit rock bottom and trust has got thrown out of the window. Banks stopped lending to each other as no one knew when the other party would collapse. In a concerted and coordinated manner Central banks pumped billions of dollars directly into banks, partially nationalizing them but to no avail.

Stock markets were hit because sellers could not find any buyers at any price. As need for money (liquid cash) increased markets had only one way to go, down.

Stock markets never reflect the true state of a company's health. In fear markets go down and in exuberance markets go up. On the way up any good news is magnified and on the way down even the smallest of bad news is magnified ten times.

Experts predict a 12 to 18 month period for the markets to remain in the grip of bears.

With the BSE Sensitive Index tanking below 10000 points yesterday, Indian investors, day traders, speculators have lost more than 50% of the value of their investment from the peak of 21,000 points touched in January 2008.

According to experts there is more to follow.

In such times if one wants to invest is stocks, one should look for companies with robust business models and Price to Earning ratios of 6 to 8. Otherwise it is safer to place your money in Fixed Deposit with some nationalized bank where you will be assured of both, Return of Capital and Return on Capital.

The 10 Commandments of Networking

From © Mark McGregor

Getting The Most Out of Business Networking

Networking is a lot of fun! Business networking is when a group of like minded business people gather and help each other. If you check, you will surely find a networking group in your area. The networking group can meet as often as they wish, as is convenient for the participants.

Regretably, most people start with a networking group by looking for immediate gains.... that is, for favorable results for themselves. If this is what you are trying to achieve, you are networking for the wrong reasons and will be sticking out like a sore thumb.

Many people think that the size of a networking group makes the difference in networking. When groups start falling in size, members will say, "we have to build up our numbers." Now, what numbers are they referring to? Is it the number of participants? I would rather belong to a networking group of two people who can help each other on a regular basis then have a large group of business people not following the Ten Commandments of Networking. It is not the quantity, it is the quality.

"I haven't got any leads yet!" Well excuse me, have you given one, ever? Or, have you made a suggestion that might help a fellow member? Did you call anyone with a compliment and say, "Just wanted you to know, Jim, that your comments on the XYZ expansion was right on the money." One must be willing to put in time waiting also. It might take a while before people feel comfortable with offering you a referral.

Networking groups will come and go. To get the most out of your networking experience, you need to build a relationship with people who you want to have contact with. Not all members will be able to help you, nor will you be able to help them. That doesn't mean you should snub them! I still have strong relationships with my networking friends from groups that are long gone.

When networking, spend most of your time and effort on people who can help each other out, for the long term. That is right. This is a long term project. Countless times I have been to business networking events and have seen people actually run from person to person, with the expectations of first giving away their card and hoping to gather the other person's. How can you possibly build a relationship with a person when your objective is to get out there, and collect cards? Some networking groups make a game out of it to see who can collect the most in a certain time. What a waste of business cards!

You will find that a highly effective networker will "work the net". What I mean is that they will go into a function with a goal in mind. My usual goal when business networking is to have the expectation that I will "meet" and "understand" only three people per event. I know what kind of person that I can help and expect that this person will be able to do the same for me. A win/win situation is what I am talking about. The highly effective networker will take the time to cultivate a rapport.

After the business networking event is when the real work begins. After all, you are only at the networking event to meet and build rapport. Follow up ASAP. Now is the time to send a nice customized card, and call a few days after to arrange a time to meet for a coffee or to have lunch. That is when you can listen to the details of what your new "friend" requires. You might even have the chance to offer your goods and services, only after listening.

If you want to gain the most out of business networking, follow the Ten Commandments of Networking!

• 1) Thou shalt drop the "what is in it for me?" attitude.
• 2) Thou shalt listen.
• 3) Thou shalt build a relationship.
• 4) Thou shalt give the first referral.
• 5) Thou shalt not tell others of the referral you require; thou shalt "show them" with a story.
• 6) Thou shalt be specific of the type of referral.
• 7) Thou shalt reciprocate when appropriate.
• 8) Thou shalt participate in the network executive, functions, and network time.
• 9) Thou shalt thank the person who gave a referral.
• 10) Thou shalt follow up on the referral within 24 hours.

Business networking is productive and fun, and that is why it will always be part of the Bigger Picture.

Mark McGregor is a keynote speaker and professional presenter with Speaking of Hearts. He is a motivational and inspirational speaker on business and stress matters. Mark is available to speak for your next Canadian and American conference, trade show or event.