Today there is depressing news on business confidence. It is, according to one survey, at a twenty year low.
Business confidence is by far the most important determinant of investment. It outweighs the influence of interest rates significantly.
If the outlook of firms improves and they start to expect better business prospects they will invest. If the invest then Aggregate Demand will rise and probably by a multiplied amount. And so the recovery will be formed.
But the survey says that business confidence is falling not improving. And so the dreaded double dip continues.
Leeza Awojobi- this article is very true. People are becoming increasingly scared of starting their own business. One foolish thing that people do is spend all their time thinking about how to improve their product. "oh, we need the website to look professional" and "we need to get loads of stock, and a big warehouse". People pump all their life savings into something the market doesn't want or need. Well known life strategist and dating advisor Matthew Hussey runs two major businesses successfully. His best advice to learn how to sell the product or service first, before putting any money in. Learning how to be an effective entrepeneur is the key. This is one of the reasons why people are not confident. Anyone reading this article should check out some of his videos on YouTube. He's really good
ReplyDeleteAnother key issue with the lack of confidence is the apparent ease of promoting yourself. We are continuously shown that opportunity is handed out on tv shows and people don't know how to work for themselves, why take a risk if there is a chance of it happening by itself. Another problem is fear, this is natural of course, but with our current economical standing we see ourselves as weak and to take a chance is not worth the risk. Media and politicians have destroyed faith in banks, and faith in banks is fundamental to growth in the economy.
ReplyDeleteAnother issue is that people are afraid of failure and rejection. Even when they have done a huge amount of research; it does not help as they have instead learnt of other peoples failures and given up rather than diving into ideas that may help them. Also many have trouble coming up with things that do not already have a place in the market. This is a common problem.
ReplyDeleteIn addition the fear of bank investments many are afraid of failure and rejection. Even when they have done a huge amount of research; it does not help as they learnt of other peoples failures and given up rather than diving into ideas that would help their business. Also many have trouble coming up with things that do not already have a place in the market. This is a common problem.
ReplyDelete