How to Save Money, and Avoiding Survivor's Guilt
BY Max Chafkin
After the layoff. A Time Magazine article reports on the dangers of "survivor's guilt" to companies that have recently laid off staff. This happens when workers who have retained their jobs feel distressed either from guilt, anxiety, or exhaustion from new responsibilities they may need to take on. Frequently, employers are "oblivious" to these feelings. If not addressed, the negative sentiments can pervade the workplace and begin to affect productivity and commitment.
Facebook founders settle their dispute. A long-running dispute stemming from the early days at Facebook appears to be settled, Valleywag reports. "There's an excellent reason for Zuckerberg to make nice with [co-founder] Saverin, though: Ben Mezrich, author of Bringing Down the House, is writing an account of the founding of Facebook which relies heavily on Saverin as a source. Aaron Sorkin, the West Wing creator, is already planning to adapt the book, which doesn't have a publication date yet, into a movie." The tech blog frets that the settlement (if there is one) could put the book and movie in jeopardy.
Boom times for cobblers. You know things are bad when you see a story on the shoe repair industry on the front page of the Wall Street Journal. As consumers look to save money, they're patronizing the beleaguered industry at rates not seen for decades. And a few other industries—including auto repair shops, resume writers, and employment lawyers—are happily riding the recession wave. Is anyone else seeing a spike in their business?
The market for intellectual property heats up. In other bad-news-is-good-news news, Ocean Tomo, an intellectual property sales firm, is seeing a countercyclical rise in business, the Chicago Tribune reports. "Most companies would be surprised at how much of the value of their company is in intellectual property," said Kara Cenar, an intellectual property lawyer. Ocean Tomo estimates that patents, trademarks, copyrights and goodwill could make up 75 percent of the market cap for the S&P 500. So who's buying? According to the Tribune, "entrepreneurial firms see opportunity in the cast-off intellectual property because it can provide a shortcut to success."
How to save money, part I. Re-negotiate your rent. The New York Times reports that landlords are being more flexible with late payments. In expensive markets they're often willing to renegotiate rents to ensure they have tenants instead of vacancies.
How to save money, part II. Move! The Journal predicts a wave of state incentives to attract small businesses. New Jersey is planning on doling out $3,000 for every new hire, Minnesota is creating tax-free zones, and Colorado is proposing to cut income taxes for anybody who creates at least 20 jobs. But these incentives face opposition since they typically come at the expense of state layoffs and cuts to popular programs. New York, for instance, is cutting back on business incentive programs to help meet its budget shortfall.
Trade war brewing?The Washington Post warns of the possibility of a trade war. Reminding readers of the destructive protectionism that prolonged the Great Depression, the Post then flashes forward to Davos this year: "We will resolutely fight protectionism," Japanese Prime Minister Taro Aso is quoted as saying. But, the Post writes, "even as leaders call for nations to do the right thing on the international stage, actually doing it at home is proving far tougher." The U.S. faces the issue immediately, on the question of how much to restrict stimulus spending to "Buy American." Reuters reports that Canada is pushing for inclusion.
Capitalism finds an unlikely friend. Vladimir Putin, the Russian Prime Minister, delivered a surprising key-note speech at Davos last week. Putin, who has previously shown a tendency to throw entrepreneurs in jail, warned against the dangers of state "interference" in the private sector and talked about entrepreneurship as way one way to rehabilitate the Russian economy. "Development of competition, creation of a sustainable credit system based on internal resources and realization of transport and other infrastructural projects are among our priorities," Putin told the crowd at Davos. Read the full text of his speech here. There was also a healthy measure of blame for the U.S. for the global crisis. Still, one blogger for Motley Fool, a forum for investors, says Putin "apparently understands free market capitalism, the role of the entrepreneur, the dangers of deficit spending, and the limitation of State power more than our own government, be it Obama or Bush or McCain or Pelosi."
Little stimulus aid for small businesses. The Atlanta Journal Constitution reports there's little help for small business in the stimulus package. The plan does allocate more money to the SBA and allows the agency to make direct loans, establish a secondary market lending authority that would allow loans to "systematically important" lenders, and guarantee pools of SBA loans sold to investors. To the Small Business and Entrepreneurship Council, this sounds like Fannie Mae and Freddie Mac. And we know how they turned out.