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Starting out is business can be one of the most stressful experiences in life, many have dreams of starting a business and then living like a fat cat as their worker ants run around for them earning money. This couldn’t be more wrong, a business is a lot of work and should be undertaken with the knowledge that success will only come through hard work. A big part of this is getting the choice of account right; there are a huge number of account packages out there, so the choice can be difficult, the secret is to get an account that fulfils your needs and nothing else.

For instance during the early stages of your business you should only really look at having an account that allows you to pay cheques in and withdraw funds when you need them. Interest should not be a major concern until your business is large enough to accumulate a balance that will receive a decent amount of interest. It is not until this point that you should find an account with high interest rates for your business.

As a lone trader a business account can often make your services look more professional. It may cost a little extra but having your name followed by your business name on your reports and statements will not only clarify your business dealings from your personal finances but as customers write cheques they will be able address them to your business name rather than you personally; a far more professional situation.

The same can apply to a limited company although in this case it is even more advisable to open a business account. The account will be opened in the name of your business and as a limited company you will need to take your certificate that defines your business as thus. Without the Certificate of Incorporation you will not be able to open an account as banks need proof of your company’s status.

It is not always advisable to open your business account with the bank that deals with your personal finances. This is because different banks offer different services to start up customers and with varying charges. Some will have interim periods with no charges while options such as internet and phone banking will vary greatly. Also, it is worth separating your business and personal finances as letting one bank have charge of your entire financial situation can be problematic. Choosing a bank that is trying to entice you to their services is usually a good idea; fundamentally it is about shopping around.

Once you have decided upon a bank make an appointment with the account manager to discuss your finance options. You will need certain documentation for the account to be opened there and then. First and foremost a bank will want to see a business plan that outlays your objectives and goals as well as the current state of your business; without one the bank will not be inspired to support your ideas. You will also need to inform the bank where your start up finances are coming from.

Information about the signatories of the account such as business partners is also required as the bank needs to know who will have access to the account once it is set up. As stated previously, as a limited company you will also need to produce a Certificate of Incorporation if you are starting a limited company. Remember the bank are on your side so try to use their services as much as possible; some will even offer business advice to give you that extra leg up on your way to success.

Starting a business is an extremely difficult process, it is estimated that two out of three businesses fail within their first two years of operation. If you do not want to be part of this statistic hard work will be essential to achieving a solid business that is regularly returning profits. Choosing the right account package can come some way towards this and with a regular review of your financial position, success should be forthcoming.

Financial expert Thomas Pretty looks into the importance of selecting the right business account when starting out in business. To find out more please visit http://www.lloydstsbbusiness.com/accounts/index.asp

On March 14th, Bear Stearns, the fifth-largest investment bank in the United States, entered a period of insolvency. As growing lack of confidence in the firm’s subprime exposure grew, other banks eventually refused to lend to the stricken company, which has existed for over 85 years.

Were Bear Stearns a commercial bank, (i.e. institutions that loan money to people or businesses) it would be able to, as a last resort, take advantage of the Federal Reserve’s so-called “discount window,” thus receiving a government loan at the lowest available interest rate.

The reasoning behind making loans to private businesses is sound, because overall confidence in banks is much stronger. But for equally obvious reasons, the discount window cannot by definition extend to institutions that take on risk as their business because they have less or no accountability to taxpayers.

However, after Bear Stearns seemed on the brink of collapse, everything changed. Bear Stearns shares began to falter as investors took flight. The Federal Reserve took decisive action to save the beleaguered bank by guaranteeing a $30 billion loan to their biggest competitor, JPMorgan Chase, so they could buy BS without fear of acquiring more dangerous subprime mortgage-related debt.

In effect the government has now bought a troubled investment bank for pennies on the dollar, (their first offer was $2 a share, when BS traded at a high of $170 a year ago) knowing that taxpayers might have to foot the entire bill themselves. At the same time, the Bush administration has maintained that no government bailouts would extend to the financial sector.

Moreover, wealthy BS shareholders balked so much at the firesale of their investments that the Fed, under pressure from potential litigation, increased the bid for BS by five times, to $10 a share. This means that, while the potential losses will be felt by millions of taxpayers (many of whom are in danger of losing their homes to foreclosure), while profits will most certainly be reaped by the corporate executives at JPMorgan.

Even with its exceptional exposure to subprime securities, BS is still worth well over a billion dollars. Profit-taking was the name of the game on the heels of the announcement, as day traders bought up huge amounts of BS stock at $2 or $3 a share and sold after the bid increased. By taking responsibility for the BS takeover, the Fed has changed the course of America’s financial future.

By guaranteeing the discount rate to BS, they implicitly must be able to do so for other investment banks in trouble in the future, which implies continued taxpayer absorption of Wall Street failures without any corresponding kickback from banks. Unless the Fed intend to rein in on banks more as the economy struggles through the recession, this policy clearly demonstrates a dramatically different view of finance than the Federal Reserve of 1913, when there was a real discount window you could use to keep your bank alive.

Now, it seems, the most secure economically secure institutions are those most separated from average American lives. Politicians who recognize the increasing resonance of populist messages in the present climate are sure to turn this takeover into a major issue.

Ki helps buyers interested in Austin real estate http://www.escapesomewhere.com his website has a free search of the Austin MLS http://www.escapesomewhere.com/realestate_searchthemls.html along with updates on his Austin real estate blog http://www.escapesomewhere.com/austinblog/

Over recent weeks the words ‘credit crunch’ have been all over the financial headlines, and the effects of the turmoil that has hit the financial markets have been reflected in a number of ways, affecting both financial institutions and consumers.

The credit crunch was sparked as a result of the housing slump, rising interest rates, and record defaults in the sub-prime sector of the United States, and over recent weeks the global repercussions of this crisis have become increasingly evident.

The financial turmoil has hit hard on many levels. Even financial institutions have suffered as a result of the turmoil. In fact globally as many as 33,000 jobs could be lost in the financial services industry over the next three months.

So how do you deal with going from one side of the fence as a creditor or banker to the other side as a debtor? What is the best way to mentally handle the change?

At least temporarily, you may have lost many things, including your daily work, your work associations, a structure for your days, financial security, and status. Even though your job loss is due to budget cuts and not your fault, it is common to feel some loss of self-esteem, or that somehow you have failed, and it can be hard to tell your friends and family. In fact in terms of major life upheavals, the stress of unemployment ranks alongside that of a serious injury, going through a divorce or mourning the loss of a loved one.

Even though unemployment is an ongoing issue in our society, the shame associated with job loss and the tendency for people to blame themselves for their unemployment continue to increase the population’s vulnerability to mental health so no matter what your job title was before, at the end of the day you will be feeling like everyone else who has ever had the misfortune to lose their job.

It’s important for people losing their jobs to be positive about themselves and to stifle self-criticism. It’s best for them not to dwell on circumstances that are beyond their control. Instead, they should use their time and energy to generate new opportunities.

Give yourself time to adjust. Allow yourself some time to absorb what has happened–to deal with the initial emotional reactions of yourself and significant others. Be open to support from and discussions with those at work.

Spouses, partners, and children are also affected by your job loss. Give them permission to talk about their reactions and concerns. Have a family meeting to discuss how the family will cope and get everyone’s ideas. Explain the economic forces that led to the job loss. Reassure children that the family will work together to get through this time. By opening up to those who care about you, you will immediately gain support from the most important people in your life and they may also be a source of job information.

The way we frame what happens to us has everything to do with how we cope and move forward. Success in any endeavor depends on how one views setbacks in life. This is a challenge, not a failure or the end of the world. Don’t compare yourself with others who have lost their job — everyone deals with it differently. Think positively: “I can handle this one step at a time”.

No one can understand what you are going through better than your peers. Often you can share thoughts and feelings in a support group that you cannot share elsewhere. You will also get good advice and decrease any sense of isolation.

Now is not the time to try to go it alone. Reach out and use everything that is offered to you A crisis like this gives you the opportunity and permission to get help.

Admit to significant others and your support system your feelings of anger, fear, frustration, and sadness. It will help you regulate your actions and stay motivated. Keeping a written journal of how you feel and what is happening can be a big release for your feelings.

One good way to reduce your anxiety is to clarify what you are most afraid of and begin to work on a plan to address the fear–for example, the worry that you will never find another job. To paraphrase the famous statement, the biggest thing we have to fear is fear itself, and the way it paralyzes us and pulls us down.

Spend time with people who are confident in you and your future and who have worked through their own crises in a positive manner. Talk to those who have constructive ideas and advice. Notice the positive side of unemployment and enjoy it, such as more time for hobbies or family, no commute.

Do what you can and accept what you cannot change. Remember the serenity prayer: “Grant me the serenity to accept the things I cannot change, the courage to change the things I can, and the wisdom to know the difference.” Despite all your hard work in searching for a job, many other factors will also determine when you find work.

Sleep, exercise, relaxation, and good nutrition are more important than ever during the stress of unemployment. Use the extra time to set up that exercise program you never had time for when you were working so hard. Avoid the use of drugs and alcohol to deal with stress. Take scheduled breaks from your job search and allow time for fun.

If you are feeling overwhelmed, sad, blue and lethargic, you might have a battle with depression raging. Get professional help. If you are feeling very sad and in despair and it does not improve over time and/or if you are feeling paralyzed by anxiety or your sleep is consistently disturbed, get the help of a mental health professional or see your family doctor. There is lots of help available and people that care about you.

Steve Rhode is a debt expert that helps people find answers and solutions for difficult financial problems. You can read more of his advice and assistance at http://CreditDebtLife.com

The recent government-sponsored bailout of Bear Stearns, one of the top five lenders in the United States, has shocked traders and left investors cold. Despite the chilly reaction on Wall Street, secretly many are breathing a sigh of relief. While Bear Stearns was mismanaged from its upper echelons, its subprime exposure grew until their recent $30 billion-plus losses had to be reported.

Once that happened, their course took a turn for the worse. As their ability to shore up capital faltered, JPMorgan Chase stepped in with a buyout worth a bargain $2 a share, valuing a company worth $3.5 billion down to $236 million. Quite a savvy deal, if obviously designed to ensure continued security in the market more than pure profit (after last year’s hedge funds collapses, Bear Stearn’s lawyers have been busy with sub-prime exposure-related litigation).

With the impact of derivative investments and more sophisticated financial instruments, the notational impact of a Bear Stearns collapse comes at a staggering $10 trillion. Moreover, even at a share price that attractive, the Bear Stearns rival wouldn’t have bought them unless a fundamental shift in monetary and fiscal policy hadn’t occurred: The Federal Reserve’s liquidity offers to commercial banks, which have been numerous in recent months in the wake of the credit crunch, have been offered to Bear Stearns for the purpose of covering billions in frothy investments.

This sets a dangerous precedent against the continued function of American markets by using taxpayer dollars to bail out what is an entirely market-related mistake. By covering bad investments with taxpayer money, the Federal Reserve reverses sixty years of capitalist policy in favor of blatantly socialist takeovers. This could be the worst way to introduce Americans to this form of quasi-socialist government ever conceived.

No one put a gun to Bear Stearn’s collective head and made them spread risk ineffectively and invest in sketchy sub-prime mortgage securities. They did it all by themselves. Yet here we see a government-backed takeover to shore up confidence in a financial system that seems unable to take care of itself. Laissez-faire? Quite the opposite, it appears. What kind of message does this send to other financial institutions? Can they now expect similar access to the “discount window” that had been reserved for institutions that work with taxpayers, not investors?

We now have the dubious half-promise that the Fed will rein in on Wall Street during boom times, but isn’t it a lack of regulation in loaning standards and a subsequent rise in “predatory loaning” what got them into this mess in the first place? And how many more Bear Stearns get the Fed rescue while millions of Americans face foreclosure? The Fed haven’t received much criticism thus far, as their responses have taken a course they have helped the economy weather in past recessions.

However, their break from past precedent will likely draw some flags. Even if no one else will tell the emperor that his clothes are slipping off one piece at a time, hopefully the Presidential candidates will pounce on this new opportunity to compare traditional economic goals with the present shift in policy.

Ki helps buyers interested in Austin real estate http://www.escapesomewhere.com his website has a free search of the Austin MLS http://www.escapesomewhere.com/realestate_searchthemls.html along with updates on his Austin real estate blog http://www.escapesomewhere.com/austinblog/

What a difference a year makes. Last year at this time Bear Stearns had a high flying stock price of $150 a share and a market valuation of 20 Billion. Having been founded in 1923 they were considered one of Wall Streets most venerable investment houses.

Going back to 2005 Bear Stearns was selected as “Most Admired” securities company in Fortunes annual survey a distinction they retained until 2007. During this time period many of the decisions that would lead to their eventual downfall were being made. In the middle of 2007 their armor started to crack. The subprime problems were beginning to explode. Basically it was becoming clear to the financial industry that many of the subprime loans that had been given out over the last few years were not going to be repaid.

One of Bear Stearns funds, the “High-Grade Structured Credit Fund”, started to falter. In a sign of things to come when Merrill Lynch acquired 850 million of the collateral for the fund they were only able to auction it off for 100 million.

A problem started to develop with two of their funds that operated as hedge funds. The interesting word here is hedge fund. Hedge funds basically operate under the philosophy that by investing in a large number of loans that are somewhat risky you minimize the risk. While a few individuals might go into foreclosure the investor is protected because they have invested in a high number of loans. The problem the financial industry started to realize in mid 2007 was that a large number of these were going into foreclosure. In July these two hedge funds had lost nearly all of their value.

By August lawsuits had started flying as angry investors started to sue over their losses alleging that Bear Stearns had not property disclosed their exposure to hedge funds. A few months later they declared write down of 1.2 billion on their securities.

2008 brought more problems for Bear Stearns. Rumors started to circulate that they were having cash problems. JP Morgan started to provide emergency funding to Bear Stearns but it did not seem to stop Bear Stearns slide into financial chaos. This led to the final offer of 240 million. Not only was this substantially less than the 20 billion Bear Stearns was worth a year ago, but it was less than the value of Bear Stearns headquarters in New York which is valued at 1.2 billion. The fact that the purchase price is lower than the value of the real estate owned by Bear Stearns is seen as a sign that many of the financial assets Bear Stearns owns have a negative value.

Another interesting point is comparing Bear Stearns to Countrywide. Both were large institutions with exposure to the subprime real estate market. But Countrywide was seen as a free wheeling company that almost ignored risk and rose fast and feel fast. In contrast Bear Stearns was seen as an older company that had weathered through multiple recessions. But in the end the same market brought both these companies to their knees. Basically spreading out risk among many subprime borrowers does not help if the real estate market weakens resulting in a large percentage of borrowers going into default. Hopefully the collapse of Bear Stearns will serve as a warning lesson for future companies. And the warning lesson hopefully will not only be remembered only in bad times, when it is frequently too late, but in good times when the seeds are sown for future financial turmoil.

Ki helps buyers interested in Austin real estate http://www.escapesomewhere.com his website has a free search of the Austin MLS http://www.escapesomewhere.com/realestate_searchthemls.html along with updates on his Austin real estate blog http://www.escapesomewhere.com/austinblog/