Ferderal jobs

Inflation is back. It’s official, and you can blame costlier gasoline and other fuels. The tab for common services like a hotel stay and garbage removal are jumping too, as is the sticker price on packaged foods and many other household items. Companies are finding that they can pass on part of their soaring raw-material costs. There is a general consensus among American economic circles that interest rates are on the rise. And this concern is beginning to spill across the border into Canadian economic circles as well.

Typically there is an inflation that the government measures and the ‘other’ inflation that we are all used to feel but cannot see. Inflation that we all feel but can’t see comes in many forms. For example, real estate prices have gone through the roof, so cash buyers are paying through the nose. Borrowers are increasingly resorting to floating-rate and interest-only loans, especially in the U.S., which all but guarantee that they will pay more over the life of their loans. But Canadians are poised to follow suit with the spread of the ever more popular ‘Powerlines’ and credit cards secured by real estate which, once again, have the deleterious effect of keeping you into debt for the rest of your life.

We all face notoriously soaring insurance premiums, deductibles and co-pays as employers shift more of the burden onto employees. Here in British Columbia, for example, Strata insurance premiums have more than doubled in the past year, with strata corporations - especially the financially weak - having no choice but to allot the extra cost to individual property owners.

Even Alan Greenspan, the once revered and now outgoing Chairman of the Federal Reserve Bank, is coming under fire. Once known as the ‘Maestro’ for his impeccable talent at predicting economic behavior, and after being treated like royalty for presiding over the longest economic boom in the nation’s history, Greenspan is now being accused by a small but vocal group of economists of presiding over the U.S.’s high consumer debt, low personal-savings rates, declining dollar and potential real estate bubble. And all this comes at a time when the U.S. is dependent more than ever on foreign money to sustain growth.

The dependence on foreign capital, Asian in the West and European in the East, is a great source of concern for Canada as well. As China is becoming a major economic player and is fueling its own economic growth, and as Europe is coming to grip with the reality of an oversold, overstrong, overvalued Euro compared with the relative weakness of many European economies, the worry is that this foreign injection into the Canadian economy will soon evaporate, thus leaving domestic growth without fuel …. the typical Mercedes without gas.

So where does all this leave mundane folks like you and I? All I can tell my readers and real estate aficionados of my blog is:

BEWARE OF YOUR MORTGAGES !!

Luigi Frascati

Luigi Frascati is a Real Estate Agent based in Vancouver, British Columbia. He holds a Bachelor Degree in Economics and maintains a weblog entitled the Real Estate Chronicle at http://wwwrealestatechronicle.blogspot.com where you can find the full collection of his articles. Luigi is associated with the Sutton Group, the largest real estate organization in Canada, and is based with Sutton-Centre Realty in Burnaby, BC.

Luigi is very proud to be an EzineArticles Platinum Expert Author. Your rating at the footer of this Article is very much appreciated. Thank you.

Share This

While most companies seeking venture capital initially think about angel investors and venture capitalists, a large alternative source of financing is federal grants and loans. The two largest federal grant programs are run by the Small Business Administration (SBA), and by Small Business Investment Companies (SBICs).

An SBA loan, regardless of whether it is a direct loan from the SBA, or, as is more common, a bank loan guaranteed by the SBA, is essentially a bank loan. The benefit of it versus a traditional bank loan is the rate. SBA rates are typically much less than traditional business loan rates.

In most cases, in a guaranteed SBA bank loan, the SBA guarantees 90 percent of the loan will be repaid to the bank. As such, banks are at much less risk than in most other loans, and are a bit more flexible with regards to who they offer these loans. However, the SBA usually requires the founders of the company to personally guarantee the loans, which makes them risky should the venture collapse.

Alternatively, Small Business Investment Companies (SBICs) are privately organized corporations that are licensed and regulated by the SBA. Small or emerging businesses which qualify for assistance from the SBIC program can receive equity capital and/or long-term loans from these companies. Essentially, these companies provide their own capital, which is supplemented by federal funds, to the companies they fund.

Interestingly, U.S. taxpayers benefit from the SBIC program as tax revenues generated from successful SBIC investments have more than covered the cost of the program. Likewise the program has created hundreds of thousands of jobs.

In summary, SBA and SBIC financing are viable alternatives to financing from angel investors and venture capitalists and should be considered in the capital raising process. Similarly to angel and VC financing, companies seeking SBA and SBIC financing need a strong management team and value proposition, and a highly professional and compelling business plan in order to raise the capital they need.

Share This