The SBA, Recession?, Flag Day, and Novak Djokovic
The Numbers
The only thing worth discussing this week was the initial jobless claim report.
261,000 people in the United States had initial jobless claims this past week.
They expected 236,000, so it was a bit higher.
That really was it.
This week, the Consumer Price Index – CPI, aka headline inflation - will be coming out.
Oh, and the Fed (The Federal Reserve Board) will be meeting and then promptly going on vacation. Well, I would.
Most expect them to hold interest rates steady. Drum roll, please.
GDP – Gross Domestic Product
The GDP of the USA is 1.4%
The GDP of China is 4.2%
The GDP of India is 6.1%. That’s a number.
India also surpassed China in population this year, too.
India is actively taking jobs from China.
This is probably more of a mixer conversation starter than anything else at this point, but India is the up-and-comer in the world economy.
Wouldn’t it be interesting if the Rupee became the world currency at some point?
Where is that recession?
It’s just as well if it doesn’t happen, and why it may not happen:
It’s a strong labor market. I mean, have you read my reports?
There is STILL money to spend.
According to the San Francisco Fed, there is about $500 billion in savings above and beyond the pre-pandemic trend.
Hence the inflation that won’t go away.
That’ll buy a lot of concert tickets, trips, vacations, etc.
Home prices have dropped a bit, and sales have slowed, but nothing to panic about.
The consensus is that a recession will arrive, but only after rates continue to rise and the impact of higher interest costs is felt.
BUT… commodity prices are starting to drop. And by commodities, that means copper, oil, wheat, and natural gas.
THAT will impact inflation – that’s the good news.
The bad news – it means things are, in fact, slowing down. The rate hikes are working, if you want to use that term.
Banks Toughen Lending Criteria for Small Business
Piggybacking on what I said last week: interest expense is increasing.
Not only that, it’s getting tougher to get a loan from a bank.
If you have a line of credit, it could be pared back when it comes time to renew it.
A recent survey of 1,740 businesses by Goldman Sachs found that 77% of businesses were concerned about their ability to access capital, up from 23% a year earlier.
That’ll impact the business economic confidence indicator.
Another option? The SBA.
SBA applications are up 14% from a year ago.
That leads us to the next section…
SBA 7a Loans: Rates going Up!!
If you have a 7a SBA loan, you might be able to get it refinanced by the SBA.
Say that again?
Yep, the SBA will refinance one of their own loans, particularly if it’s for real estate and you will be reducing your monthly payment.
It’s the 504 program that will pay off the 7a program.
The 504 program is a fixed-rate loan, and right now, the fixed rate is 6.07% for 20 years. I’m guessing that’s much better than the 10% on the 7a you may be paying right now.
As the Genie says, there are a couple of provisos, a few quid pro quos.
But call me, and we can discuss it. It’s what I do.
Novak Djokovic
This past weekend, Novak Djokovic won the French Open; there is a reason I mention this.
The French Open, played on a clay surface, is one of the major tennis tournaments, the others being The Australian Open (hardcourt), The Wimbledon Championships (grass), and the U.S. Open, also on hardcourt.
Given the competition and the fact that there are 128 players in each singles tournament draw, it is really a significant moment in a player's career to win a single major tournament, regardless of the surface.
Novak, with his win on Sunday, won his 23rd major title. They are as follows:
10 Australian Open
7 Wimbledon
3 US Open
3 French Open
That was tennis history being made because he becomes the sole record holder of most major tournaments won by a man.
Margaret Court holds the overall record with 24 and Serena Williams is tied with Novak at 23.
So those are the stats.
Djokovic is 36 years old, and he is besting players way younger than he is, and he had a better win ratio in his 30s than he did in his 20s.
He credits this to his very regimented training program. He expects the absolute best from himself and the staff around him, whether it is his workout partner, coach, nutritionist, trainer, or anyone else he hires to make him the best. His goal is to do his very best every day. So now, we get to my point.
Part of his victory speech on Sunday:
“One thing is for sure. I feel I have the power to create my own destiny. I try to visualize every single thing in my life and not only believe it but really feel it with every cell in my body. I just want to send a message out there to every young person; be in the present moment. Forget about what happened in the past, (the) future is something that is just going to happen, but if you want a better future, you create it. Take the means in your hands, believe it, create it.”
I mention this because, as a business owner, you create your own destiny. The court and your equipment are your products, services, and customers. If you practice every day and have the right attitude, you will win more than your competition.
Now, take the means in your hands while many others slack off in the summer.
Flag Day
Flag day is Wednesday, June 14.
When the Revolutionary War started in 1775, the flag that George Washington flew did have 13 alternating red and white stripes. But it had a Union Jack in the corner. Washington did not think it was inspiring to have a replica of the British flag on the colonist’s flag.
On June 14, 1777, the Second Continental Congress passed a resolution stating that “the flag of the United States be 13 stripes, alternate red and white,” and that “the union be 13 stars, white in a blue field, representing a new constellation.”
June 14 is one of the days that the American Legion states that you should fly your flag in honor of Flag Day.
The American Legion also says you should fly the flag on Father’s Day.
If you don’t have one, buy one. It’s that time of year when you can find an American Flag just about anywhere since July 4th is right around the corner.
Father’s Day is Sunday, so go get the guy a card and make a phone call because there will come a time when you won’t be able to.
