What's New At Credit Matters?

The next three-month observational report on what is happening in Australia due to the pandemic and recession is now available on our website.

If you or someone you know need help with outstanding and past due invoices, to protect or increase their cashflow, help is available. Just refer to the attached brochures of the two qualified and experienced credit and accounts professionals or contact Kim.

There are two brochures from The Australian Small Business and Family Enterprise Ombudsman regarding the new rule which paves way for collective bargaining by small businesses and Ombudsman launches Review of Discretionary Mutual Fund proposal to help businesses obtain affordable insurance.

As always, if you wish to promote your business services at an affordable rate, contact Kim at kim@creditmatters.com.au. You will be surprised at the value we have to offer.

Quote Of The Month

Monthly Business Observation

This month’s quote is timely when you consider where we are at in the world today. Turmoil is all around us, those people which we expect to give us unbiased support are often found wanting and the rules of life and business which we grew up with, are being constantly challenged.

One of the key examples which explains the turmoil and issues we all face, are the developing asset bubbles of property, the sharemarkets and cryptocurrencies. These days, there are three main groups of people which are outlining their thoughts on these asset classes.

In the first group, you have the cool heads, with the experience and an understanding of history. These people advise that these asset bubbles are a danger and do not make sense. As such, these assets are a threat to our wellbeing.

The second group are those with vested interests who want other people’s money, or believe their insights into economics, allows them to put into place, all sorts of untested theories and strategies.

Of those that want other people’s money, it would be wise to remember Danny DeVito’s character Larry the Liquidator from the film “Other People’s Money”. Larry liked nothing better than “… other people’s money”.

In regards to those which put forward their untested theories, they still persist with the same message. This is despite the evidence that their strategies don’t and are not work working, and the continued expression of concern by many critics.

Then there are the third group, the FOMO’s who are those that live in the fear of missing out, on the latest money-making venture, or missing out on their opportunity to buy a home. In either case, irrespective of whether they are buying the “product” with their own money or via borrowings, problems will occur if there is any downturn in asset prices or the economy.

When all said and down, yes, there will be people who will make a lot of money out of these assets. However, those that suffer a loss, will be caught in a downward spiral of financial damage and reputation. In time, these factors will affect all businesses in the wider community through lost sales and customers who no longer have the means to buy, or have access to cheap credit.

This Month's Business Inconvenient Truth

One of the great inconvenient truths of business and life is that sometimes, we make mistakes. The reason why our efforts and decisions did not work, could be a result of many different factors.

The very worst thing we can do however, is to start the blame game if the fault lies within ourselves. For instance, many people cannot accept criticism in any form and seek to blame others after suffering a loss. These people often play the victim card, and do not reflect critically on their own failings. As such they rarely learn from their mistakes, even if they can financially afford to, and therefore fail to develop as human beings and better businesspeople.

The many people who lost their money to fraudsters and scammers are such people. A small number of people will be honest enough to say they are embarrassed by being conned. Some of these same people, despite this embarrassment, do learn from the experience and even are willing to publicise this in an effort to help other people.

The majority of losers however, seek to blame others for their naivety and greed, or in the case of the regulators, their lack of attention and actions. That is one of the reasons why many people hated Bernie Madoff so much. The truth is, Bernie in a number of instances did try to warn some people they weren’t suited by the investment, yet they still wanted to invest with him. They also did not stop with a minor investment as cautioned by Bernie; they usually invested all their savings anyway.

Did Bernie Madoff deserve to be hated by all those that lost their money. In some cases, definitely yes. In other cases, a definite no. Those that hated Bernie the most, were victims of their own greed, or lack of attention to their responsibilities, and were embarrassed to have been exposed as either stupid, negligent AND/OR greedy.

Will most of us learn from losing our money to fraudsters, probably not. We continue to see reports of people being scammed regularly in the media. It appears when money is involved, greed gets in the way of common sense, even when the reported losses of other people from similar situations are exposed.