Ukraine, The Ides of March, and Entrepreneurship
What a difference a week makes. There’s nothing funny about what’s going on in Ukraine, but it’s kind of making a joke out of Putin. Speaking of…
Putin visits Estonia and the immigration officer says "Name?" "Vladimir Vladimirovich Putin", Putin replies. "Address?" the custom’s officer continues. "Kremlin, Moscow, Russia", Putin says. "Occupation?" "No, just visiting this time."
What do you call a Russian bedpan? A poo-tin.
The stock market really doesn’t like surprises, hence the volatility, but you better get used to it.
The S&P is in a correction phase, which means it is down 10% from its high point on January 3 of this year.
Where does the money go? The money usually goes to bonds in times of uncertainty, like say, an invasion from what used to be a world power but acts more like the newest resident of the senior care facility pushing people out of his way to make it to the buffet line.
PPP Forgiveness – time is running out…
There are articles and stories talking about businesses having issues getting their second draw PPP loans forgiven, so here are the facts:
If your loan is $50,000 or less, it is very likely your lender has delegated it to the SBA. Go to the SBA Direct Forgiveness Portal and take 10 minutes to have it forgiven. I can help with that – really.
If it is over $150,000, you have at least until mid-April to get that done. I can also help with that.
If it is between $50,000 and $150,000, you still have to run some tests, but it is document-free if you pass the test. And most do.
Don’t waste time – getter’ done! Or ask me to do it for you.
Beware the Ides of March…
Why? That’s when the Fed has their next meeting – March 15, aka The Ides of March. It’s called the Federal Open Market Committee meeting, or FOMC for short.
Everyone is waiting with bated breath to see if and when the Fed is going to raise the bank borrowing rates and the Ides of March may well be it.
Here are some details about the meetings with the FOMC and the Board of Governors of the Federal Reserve System.
They meet eight times per year for two days.
There are 12 members of the FOMC, five of which are Federal Reserve Bank presidents, including the Federal Reserve Bank of New York.
Fun Fact: take a paper bill out of your wallet; for anyone under 30, do an image search for a dollar bill.
On the face side of the bill, to the left of Washington, Lincoln, Hamilton etc., is a seal with a letter in the center. That designates which Federal Reserve Bank printed the bill. Collect all twelve!
There were 90 people in attendance at the January meeting – yes, it was virtual.
So, what did they talk about (yawn…)
Selected committee members, SOMA, operational readiness, securities lending, Foreign currency accounts, warehousing, spot and forward currency….zzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzz – thrilling stuff. And there is a lot of it that impacts banking and monetary policy.
And finally, on page 9 of the single-spaced, 10 pt. font report, “The Statement on Longer Run Goals and Monetary Policy Strategy” – finally.
That went for another 11 pages…
The first paragraph basically is the Fed’s mission statement: “The Federal Open Market Committee (FOMC) is firmly committed to fulfilling its statutory mandate from the Congress of promoting maximum employment, stable prices, and moderate long-term interest rates. The Committee seeks to explain its monetary policy decisions to the public as clearly as possible. Such clarity facilitates well-informed decision making by households and businesses, reduces economic and financial uncertainty, increases the effectiveness of monetary policy, and enhances transparency and accountability, which are essential in a democratic society.”
They discussed unemployment without saying what the ideal target is.
They stated that they want the inflation rate to be 2%.
Curiously, they then discussed what the markets were saying about them and what the markets thought the Fed was going to do – basically industry gossip. This information was based on reports from staff within the Federal Reserve.
Finally, they authorized the issuance of the press release summarizing their monetary position. It is expected that this next meeting will result in a rate increase in the Federal Funds Rate (I will discuss that next week). All over the course of two days.
Inland Empire Entrepreneurship
Cal State San Bernardino released the State of Entrepreneurship Report surveying almost 1000 business owners in the third quarter of 2021.
CSUSB is a significant player in the study and practice of Entrepreneurship and ranked in the top 50 schools nationwide specifically for that subject. It’s really a shining star for the IE.
This week’s tidbit from the report: Why did you start your business? And the top four answers are:
More freedom to control my lifestyle & schedule
Being my own boss and working on the things that matter to me
Creating a business that would allow me to take advantage of my talents in a specific skill or trade
Potential to make more money/financial independence
Most folks I know, including my students, want all four of those things, but it is only a few that do something about it. Congratulations business owners!!
More to come from the SOE Report from CSUSB in future Russell Reports.
Let’s see what happens this week in Europe.
