Thursday, August 06, 2009
I do - but I'm a democrat!
For 20 months now, we CFOs have weathered intense pressure to push past the daily cascade of negative economic news and help our companies survive this recession, although I feel this one has not lasted as long as any of us anticipated. Few of our financial decisions have been easy. . . or fun (are they ever?).
Recently, President Obama stated that we are experiencing the beginning of the end of the recession. Other critics argue that the recession can't possibly be over with unemployment rates so high.
Contrary to popular belief, I believe employment rates are exactly where we should expect them to be.
Tatum's monthly Survey of Business Conditions - which looks at the past 30 days and forward to the next 60 days of current business and economic trends - clearly indicates that employment is a lagging indicator of the health of an economy. Unemployment didn't rise significantly until several quarters after the recession officially began in December 2007, so we shouldn't expect to see employment rates returning to normal for several more months.
The Tatum Survey, which predicted a recession several quarters before it became official, also confirms that the economy is slowly but steadily heading toward a recovery, despite a month of stagnation back in July.
More important for us (and it really is all about us, isn't it?), how can we as CFOs lead our companies and communities toward gaining strength and preparing for the future? Sure, many of us have created cash flow forecasts, restructured staff, attacked costs and renegotiated with vendors, but those are survival techniques.
My colleagues and I have shifted our focus to growth and we're seeking ways to raise capital and prepare for future M&A activity while valuations remain low. Planning for 2010 starts now or we'll be behind the curve.
What are your ideas on finishing 2009 strong and preparing for 2010? Can we help "lead" out of this recession?
Labels: Capital Restructuring, Cash Forecasting, CFO Mentoring, CFO Roadmap, Equity Investment, Financial Consulting, Financial Projections, Merger and Acquisition Services, Raising Capital
