What Sets You Apart From Your Competition?

Too many people start an online business without taking a proper look at their competition first. Of course it doesn’t matter that you’ve got competition, but it does matter that you know how to set your own business apart from theirs.

Sometimes you come across half a dozen websites all aimed at the same target audience and there is nothing that distinguishes one from another. That’s why you need your own USP. A USP is a unique selling point that makes you stand out. It’s why people choose you rather than someone else – and it can also be why they keep coming back to you rather than going elsewhere in the future.
What Makes you Different?

Finding what makes your own online business different from the rest isn’t always easy, which is why it will pay you to spend some time thinking about what you want to achieve with your online business.

Start by thinking about who your business is aimed at. Look at what you competition is doing and work out how you can offer something that no one else is. Can you do something better? Do you have unique access to more knowledge? How about pricing?
Define your Online Business

All these elements help to define your online business and give you a better chance of making your own mark on the internet landscape. Website design is important as well. You should also think about the type of content you have on your website as well as how you operate your online business, as this can have a big effect on the amount of visitors who come to your site – as well as affecting how many of them stay and convert to customers.

It goes without saying that you should always do the best job you can to ensure your website meets the needs of your customers. But while this is an ongoing process you should always start from the strongest position you can.
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Money :Some Thing About Money

Money is good! In this day and age that we live in, money is not only good, but absolutely essential. Besides air, it may be the next most important thing in life. Of course health, love, friendship, fitness, faith, and happiness are all very important too, but how do we eat, or pay rent, or go to the doctor without having money? Until we change society dramatically, money will always be number two on a scale of importance, with air being number one.

That doesn't mean that money should be one's only reason for existence as that would be a weird and unnatural form of money worshipping. To function in society we have to have a certain amount of money to operate comfortably. That could mean $250 per week or $800 per week depending on your circumstances and your location. Anything above that survival amount is less important than your health, your family, your happiness, your friends, and your spiritual life. Anything below that amount becomes a struggle for survival and should avoided at all costs.

money is evil Money is not the Root of all Evil
Many people form their opinions about money from an early age. Unfortunately this means that many untruths get picked up from those in our life that mean well. One of the biggest untruths is that money is evil and the cause of all our problems. This may have come from our parents or religious authorities or mentors trying to teach us their beliefs.

True, money has been involved in many of society's problems, but it is really the people that are causing the problems. Money is really just a tool that is used and abused by people. While there are many people willing to kill or die for money, there are more people using money to heal the sick and feed the poor.

A good person will do good with money, while a bad person will usually do evil. A knife shouldn't be labeled evil because of a few bad people using them incorrectly.

money can buy happiness Money can buy Happiness
Another common term that money has been burdened with is that it can't buy happiness. This is partly true yet mostly false. It is quite possible to have very little money and live a very happy and fulfilled life. But if you have less money than is required for survival and the bills are coming in, your landlord is chasing you, and your children are hungry.. how happy would you be?

I'm as hippy as the next dreadlocked, organic eating, environmentalist at a music festival chanting, but I believe that money can increase my happiness. It makes me happy to give to friends, to own a house, to eat organic foods, to provide for my family, to wear comfortable clothes, and to drive a car that is friendlier to the environment.

Look at the two richest men in the world as an example. Bill Gates is finding his greatest happiness in giving his money to those that are less fortunate. His friend Warren Buffett has pledged to give the majority of his fortune to the Bill and Melinda Gates Foundation. They are working on solving some of the biggest problems in society because they have the money to do it. Very few wealthy people find happiness in clinging to their great fortunes. They find happiness in providing for their families, their community, and even solving global issues like Warren Buffett and Bill Gates are doing.

increase money Increase your Money
Even if you do believe that money is evil and that money can't buy happiness, it is hard to argue that your life would not be better if you had a little more money. You may not want a million dollar home or a hundred thousand dollar sports car, but being able to pay the bills on time and eating good food should be the starting point for any happy individual.

There are ways to increase the amount of money you have with very little sacrifice to your current lifestyle. There are ways that are so simple that most people disregard the advice because they think money is not that easy to acquire. You don't needs accountants and financial advisors or even a large income to start becoming wealthy. All you need is commitment, persistence, and time to have more money.

10 percent of money Keep 10 Percent of Your Money
The path to becoming wealthy starts with keeping at least 10 percent of all you earn. It's a rule that is ignored only by those with no money. The ten percent is not for holidays or fast cars or a bigger house, but for investing in assets that produce an income and/or increase in value. As your total income increases, your ten percent increases and your tiny amounts that you first started saving each week become larger and larger. Your wealth snowballs with time.

If you are not wealthy I can guarantee you that you don't use this technique. If you are wealthy, there's a good chance that used this technique or something very similar. George S. Clason wrote a little book of money parables called the Richest Man in Babylon. It's a book that should be essential reading for everyone that has less than $10,000 in the bank.

How To: Buy Influence

It’s no secret that power and influence are commodities that are bought and sold every day. It is a thriving market in which integrity wears a "for sale" sign. This is human nature. To think otherwise is naïve. The halls of power in America buzz with this thriving market, and normally it goes unnoticed by the public (super-lobbyist Jack Abramoff being one of the more rare -- and high profile -- exceptions).

Regardless, there are occasions that demand one’s entrance into this market: A society writer slams you or your wife, union demands are throwing a wrench into production, or impending tax legislation threatens to cost you millions. When the time comes, you should know how to approach the journalists, politicians, union leaders, public detractors, judges, and any other influence-wielding gatekeepers whose assistance you might need.

Getting that influence swayed in your direction requires an understanding of the psychological makeup behind each personality. Since money alone won’t always suffice, you should begin by identifying how your approach ought to be tailored toward their particular type; toward spotting and exploiting their individual Achilles heel.

Journalists and gossip columnists
There isn’t a gossip columnist alive who doesn’t crave a good story or something to talk about. The very nature of gossiping about the private lives of others suggests an individual with a low integrity threshold. Add to it the fact that most of these columnists already enjoy a give-and-take relationship with the people they write about; they provide ostensibly "free" -- or at least, "hands-free" -- press for names in the news. Their fellow journalists are not too different, each craving to break a major story in order to step front and center into the public eye.

To buy a journalist's influence, consider offering your own influence to help bolster their wider profile. Promises of a speaking tour or even a book deal (a collection of columns, perhaps?) might be sufficiently intriguing to sway your case or, since many journalists dream of being novelists, you could use your own influence to set them up with the right editor at a publishing house.

Plan B: Numerous people work above the writers of newspapers and magazines, both in print and online. These people may better understand your situation -- perhaps in exchange for their own favors -- and can see to it that the writer in question is either openly demoted or starts to receive assignments meant for younger or inexperienced writers.

Politicians
Congressional representatives, governors, mayors, city council members, and those in virtually every political position are all vulnerable to sway. Few, if any, politicians sustain their do-gooder mentality for long before they become jaded. Some don’t have such a mentality to begin with, but simply crave the power and influence associated with political posts. This "appreciation" for their own power is one of human nature’s Achilles heels -- a typical downfall for any disgraced politician.

In this case, money really does talk. You can fund a politician’s pet project or make campaign contributions, since politicians cannot keep their jobs without special-interest money. Yet you may see more success in securing their influence if you can make promises, post-politics, for them to serve either on prestigious corporate boards or as high-priced, do-nothing “consultants.”

Plan B: In the event that your efforts fail or even backfire, you can consider blackmail, but you may be better off by making known your intentions to support the politician's opponent in the next election. In addition, this will demonstrate the measures you can take to ensure his term is considered deeply ineffective -- by constituents and fellow politicians alike.

A few more influential people you may need to buy influence from in the future

Union leaders
In the U.S., the National Labor Relations Act (NLRA) guarantees all employees the legal right to form a union, and the same act declares it unfair labor practice on your part to prevent them from doing so. Unions can do you a tremendous amount of damage to you in a wide variety of ways.

However, union leaders typically come out of the workforce itself and can be vulnerable to -- or perhaps even accustomed to -- bribery, whether it be straight cash, vacations or other gifts. A raise or a promotion, however, is likely to raise red flags.

Plan B: If that doesn’t work, recall that union leaders are appointed from within. Therefore, if your efforts with one leader fail, take a page from the CIA’s playbook and work quietly to promote a candidate or leadership more favorable to your interests.

Public detractors
Public detractors, such as environmental activists, are bound to create problems for you, particularly if your business plans encroach on natural reserves or natural habitats. As you may already have experienced, these are typically highly principled or at least highly devoted types for whom offers of money do little.

However, they do understand sacrifice. So consider offering something else that would be in their interests, but that won't get in the way of yours. For example, offer to create an ecological or environmental endowment, either in their name or the name of their organization. The mentality you want to instill in them is this: “Either I can fight for A and potentially lose, or I can sacrifice A for B; isn’t it worthwhile to gain B even at the cost of losing A?”

Plan B: Go after their credibility. Because public detractors shout the loudest and claim so much righteousness, the best way to undercut their power to hurt you is to undermine their credibility as defenders of the public good. A good private investigator can dig up just about anything you need in this regard.

Judges
The U.S. Constitution dictates that Supreme Court justices, court of appeals judges and district court judges are nominated by the President and confirmed by the United States Senate. They enjoy lifetime tenure.

However, lower court judges and State judges are often elected officials; they must campaign for their job, and thus operate no differently than politicians do, making campaign contributions an essential tool to buy influence. All too often, U.S. voters are far more concerned with other elected officials to pay attention to the judicial races, so numerous such races are bought every election year. The results of an American Bar Association poll show that most Americans believe in the justice system despite not understanding many of its inner workings.
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Plan B: If buying an election fails and you need to influence a sitting judge, keep in mind that the huge majority of (but not all) States require judges to have experience as attorneys. And keep in mind that, while some judges may enjoy serving smaller, municipal courts, most have the higher courts in mind. If you have the influence to get a judge appointed to a higher bench, dangle that carrot accordingly, albeit with caution.

Gatekeepers
The men and women who determine access into country clubs or private schools are well aware of their power and influence. Their judgments decide which children enjoy the best education and which businessmen enjoy the networking opportunities afforded by the most exclusive country clubs.

They’re no strangers to efforts at bribery. Yet, while money may indeed buy you the necessary influence, you have no idea what kind of bribery offers you’re competing against. Without that knowledge, you’re best avoiding basic pecuniary bribery. Rather, for people who enjoy a position of power such as these, in order to get yourself or your children in the door, you should consider what’s in it for him. What can he gain? Depending on the situation, perhaps the offer of a relatively lucrative or prestigious job -- either within your company or through one of your contacts -- will see your "bribe" outdo the competition.

Plan B: Keepers of the gate are never lords of the manor. Your second-best chance is to go over their heads.

Becoming A Financial Player In Troubled Times

REASONS TO INVEST DURING THE RECESSION
Here’s a bit of evidence to suggest we may soon be in for a bullish ride:

Right now there is more being accumulated in money market fund assets as a factor of the S&P 500 Market Capitalization than at any point leading into the previous bull market periods dating back to 1981.

Investors are itching for a reason to jump back in. Although we may have a bit of road to travel before we hit bottom, it helps to know that the markets do a pretty good job of factoring negative news and perceived weaknesses into current market prices.

Instead of pushing the panic button and heading for the Wall Street exits, now is the time to start scoping some sexy stocks that are trading at valuations even investing icon, Warren Buffett, would like to sink his teeth into.

I’m talking about solid companies that will have no trouble surviving the recession and weathering the storm. And when the economy gets back on its feet, you better be prepared to hold onto the money rocket en route to Venus.

how to invest during the recession
OK, so either you have cash already sitting on the sidelines or you’re simply looking to allocate resources toward securities that may be dirty today, but sexy tomorrow. Here’s one way to play it:

The following is an initial list of criteria that you can use in conjunction with an investment screener during recessionary times to add significant arsenal to your investment portfolio:

Return on Equity (ROE)
In a nutshell, we’re looking at how well the company is using its earnings to generate more earnings. It reflects just how well management is at efficiently discovering solid investment opportunities. Specifically, we want to find stocks with an ROE greater than 10%.

Becoming a financial player in trouble times doesn't have to be hard with these tips from Oxbury Publishing

Quick Ratio
Think of this fundamental indicator as a measure of liquidity and the ability of a company to meet its short-term debt obligations. In other words, can they pay the bills and stay in business? Cash is king, and if you don’t have enough, it’s game over. The important thing to take away here is that a quick ratio over one is, generally speaking, quite good. And the higher this figure is, the stronger the company is financially.

Growth Rates
Markets are generally not shocked by news. When word of an impending event is leaked, the market in its efficient nature has a way of already pricing in these factors.

This leads us to growth rates. Current company growth rates are likely to be factored into the price of the stock, even next year’s growth to a certain extent. The key here is to see which direction the company is going and to find out just how robust that growth really is.

With that said, we’re looking for a company whose next year growth rate is higher than the current rate of growth. And next year’s growth had better be positive because in this type of environment, we don’t have time to watch a company try to dig itself out of a hole.

Price-to-Earnings Ratio
The P/E ratio is the price per share divided by the company’s annual earnings per share. The higher the number, the more investors are willing to pay for each unit of income.

Many investors believe that they can just size up a P/E ratio and pull the trigger if the number is low enough.
Not so fast.

Some ratios are low because either no one is willing to pay a high value per share and/or the stock resides in a low growth industry.

High P/E ratios can sometimes be justified -- especially if it’s an initial public offering (IPO), technology or high-flying internet stock like Google.

In order for this ratio to be effective, we have to compare it to the company’s peers within the industry itself.

In essence, we’re looking for a stock’s P/E to be lower than the industry average. This ensures that the earnings expectation bar is not set too high so as to give investors a reason to sell and punish the stock.

Profit Margin
It’s a basic measure of profitability, but again, we need to ensure that the company is in fact earning a profit. Again, we should probably dictate this percentage to at least 10%.

So, how do we put our criteria into a screener to do the dirty work for us? Simple:


Using powerful stock screeners
If you’ve ever used stock screeners before, you’d know that many of them out there are free, although vastly underdeveloped. However, MSN has developed a sophisticated and easy-to-use application that is actually somewhat difficult to find.

It’s called the MSN Deluxe Screener and you can find it by simply doing a Google search for this term.

Following the download, you’ll be taken to a window that will allow you to input your investment criteria. Make sure you bookmark this page.

When all is said and done, you can press “Run Search” and watch as the filter returns stocks that fit the profile along with all the data necessary to make a good comparative analysis.

Before taking the plunge on my word alone, be sure to do your own due diligence.

Good Investing,

5 Places To Hide Your Money

1. Savings account or CD

If you have cash set aside that you will need for expenses anytime in the next 12 months, the stock market is not the place to hide your money. The market has been experiencing unprecedented levels of volatility recently, so now is not the time to see if you can double the kid’s college savings before he or she enrolls in the fall.

Your move here is pretty straightforward. You are probably best served by putting your money into a savings account or CD (Certificate of Deposit). Presently, savings accounts from ING Direct have an annual percentage yield of 2.75%. If you do a Google search on “CD rates,” you will see that you can find numerous institutions that will pay you between 4% and 5% on a 12-month CD.

2. Exchange traded funds

If you aren’t going to need your money for at least three to five years, the stock market is not a bad way to build wealth. Exchange traded funds (ETF) are an easy way for individual investors to create a diversified portfolio. Buying an ETF is similar to buying a stock, except that an ETF tracks an index such as the Dow Jones or the S&P 500. It gives you instant diversity. If you open an account with a discount broker such as Zecco, Marsco, TradeKing or Scottrade, you will be able to buy ETFs for only a few dollars per trade. After making a deposit into your brokerage account, look to purchase shares of the iShares S&P 500 Index Fund (Ticker: IVV). This ETF will give you broad exposure to 500 large cap stocks.

Aim to make purchases of equal dollar amounts on a monthly basis over the course of the year. This approach will smooth out the market’s peaks and valleys and ensure that you don’t put all of your money in at the market’s top.

3. Corporate bonds

Another option that carries less risk would be to purchase shares of the iShares iBoxx Investment Grade Corporate Bond Fund (Ticker: LQD). This fund is also an ETF that will give you broad exposure to the corporate debt of close to 100 large corporations such as Wal-Mart Stores, Johnson & Johnson, IBM, and Time Warner.
This ETF pays dividends on a monthly basis and its yield is currently 6.5%. This option is more conservative than investing in the S&P 500 and lacks the upside potential of an investment in stocks.

4. Target-date ETFs

If you are looking for a place to put your money for retirement and don’t want to constantly worry about it being properly allocated, target-date ETFs might be the perfect answer. Target-date ETFs allocate your money between both stocks and fixed income. The funds are more aggressive for those who have a while until they retire and they automatically adjust as one approaches retirement.

For instance, if you were looking to retire in 2030, you could invest your money in the TDX Independence 2030 ETF (Ticker: TDN) and your money would be allocated with that end date in mind. This option is an easy, low-maintenance approach to investing for retirement. You are essentially investing on autopilot.

5. Mutual funds

Another common approach to achieving a diverse portfolio is to invest in mutual funds. Mutual funds give you exposure to a number of companies and are actively managed by a portfolio manager as opposed to just tracking an index. Mutual funds typically have higher expense ratios than ETFs and established minimum investment amounts.

If you are looking at mutual funds, check out the CGM Realty Fund (CGMRX) and the CGM Focus Fund (CGMRX). Both funds are managed by investing legend Ken Heebner. In the time period from 2003 to 2007, the Realty Fund had annual returns of 89.7%, 35.5%, 27.0%, 29.0%, and 34.4%. You can dodge paying a commission to a broker to invest in these funds by going directly through the CGM Funds website.

Top 10: Investing Mistakes

Often, obvious mistakes are the ones most repeated in life. Investing doesn’t escape this paradox. People have short memories and history usually repeats itself in the financial world. Money Investing can be complicated if you have no experience with the basics of personal finance; however, you must start learning about investing now in order to plan for a brighter future. Avoiding the following top 10 investing mistakes will help everyone from the new investor who is just learning to an experienced investor who needs a refresher.

Number 1
Mismanaging risk

Some people want to take too much risk, while others want no risk at all. Neither is a good option for your financial future. If you take on too much risk, you may erase all the gains you worked so hard to build. However, if you don’t take on any risk, inflation will eat into your principal, thereby lowering your purchasing power. Finding a common ground on risk is the pursuit of every investor. Choosing a sensible allocation of mutual funds should help to ensure your financial success later on.

Number 2
Not diversifying
The most important rule of investing is to be diversified. In other words: Don’t put all of your eggs in one basket. This rule seems simple enough, but it is easy to forget. At first, you might start out diversified, but then one position gets inflated and you might not rebalance. Don’t get caught up in the whirlwind of that new biotech stock either. With risk comes reward, but taking on too much risk with one company is just foolish.

Number 3
Stock selection
Those who try timing the market and fail often venture over to stock selection. This involves choosing certain stocks you think will outperform a certain index. The trouble is that even professional money managers can’t do this consistently. You could throw darts at a board, but investing in the S&P 500 is a wiser choice. The S&P 500, known as the Standard and Poor’s 500, is an index of the largest 500 stocks in America. It is the most commonly quoted barometer of the U.S. economy and you can buy the index in an exchange-traded fund under symbol SPY or IVV.

Number 4
Timing the market
Study after study has shown evidence that timing the market doesn’t work. However, every year thousands of people try to time the market only to end up disappointed. Timing the market involves making frequent trades in order to get in when the market goes up and get out when it goes down. The problem with this strategy is it’s almost impossible to predict the future. Instead of trying to beat the market, set up a sensible portfolio asset allocation and stick to it. Use dollar cost averaging by adding money to your positions when you can.

Number 5
Magic product
If you have ever been up late watching television into the wee hours of the morning, then you have undoubtedly seen infomercials. They tout secrets of buying real estate with no money down and promise huge profits through options and futures. A recent television commercial actually interviewed a family and showed their kids getting in on the trading. However, the fact is that exotic investments like options and futures are highly complex and can be risky if you are a novice investor. The commercials might make this magic product seem like the best way to make fast money, but it’s a commercial and that’s precisely what it’s meant to do.

Number 6
Making emotional decisions
Emotions are great in many parts of life, but they are bad when it comes to investing. Many people obsess over each move the market makes, becoming happy with a move up and angry about a move down. Stay away from CNBC if you find yourself in a panic over market news flashes. Investing is a marathon, not a sprint, and it is important to take a long-term view.

Number 7
Over monitoring your portfolio
Some investors constantly check the progress of their account on the internet, logging in several times a day to see how their personal portfolio is doing. The problem with this is that the market is quite volatile in the short-term. Constantly checking your account can lead to emotion-based decisions, both good and bad. Having these swings isn’t good for your mental health. It could also lead you to make brash decisions, like selling into a downturn and then buying when the market is on fire, which is exactly the opposite of what should be done.

Number 8
Ignoring your portfolio
There comes a time when you could over monitor your account, but the exact opposite might also be true. Many people don’t want to think about their financial future, and as a result, they don’t know what they hold in their portfolio. Instead, try to find a balance when viewing your gains and losses. Most financial professionals recommend viewing your account at least every quarter, because checking your account daily could lead to bad decisions in the face of short-term market moves.

Number 9
Margin
Using margin can be hazardous to your financial health. Margin is actually the amount of money your brokerage firm loans you to buy more securities -- think of it like a credit card. You often get up to 50% of your portfolio's value to borrow. The downside is paying interest and having a margin call if your balance falls below a certain point. Instead of using margin, save up the money before you invest.

Number 10
Limit orders
One of the first mistakes one makes when investing is using limit orders instead of market orders. Limit orders set the exact price you pay for a stock or exchange-traded fund, while market orders are filled at the current price when you enter the trade. Long-term investors should only place market orders. If you are investing for 10 to 15 years or more you shouldn’t be worried about a few ticks within a matter of minutes.

Money Is Good But...

If you want to be a player in this world you need money -- we all agree on this. Keep in mind, however, one important fact: money itself has little intrinsic value. For money to have a value to up-and-comers such as yourself (unless you are a loser who just happened to stumble across this article), money should be used carefully to achieve certain objectives.

What do I mean? It's simple, money can be spent to acquire power in this world. Policemen being bribed, politicians and judges being bought, and gifts given to certain people (that expensive bottle of wine or that red Ferrari F355) are all ways to use money in order to acquire power.

When a businessman donates millions to his Alma Mater (for you morons out there that means the University he attended and graduated from), is it just for the fun of giving away money? Not unless the guy's lost his marbles (it happens, I know this guy Salvatore...forget it, I'll tell you about him some other time).

Usually such a donation serves many purposes: to show the world he is successful, to make high level contacts (which can be used to make more high level contacts), and to guarantee that his two kids, with a combined IQ of 47, will get into Harvard (who said life was fair?)

When you have money, you can help those people you want (or need) to help much more easily than if you don't have the necessary financial resources. The catch-22 is that people with money and power tend to hang around expensive places.

Thus if you want to make those contacts and hang with that crowd, you have to have access to enough capital to gain entrance to these places (and don't forget to dress the part). Furthermore, a modicum of respectability and recognition helps (hence the large donation to a university, local hospital, political party, etc.).

This is money used the smart way; keep reading for the downside of money. And there is a huge downside to having money, believe it or not. My mother once told me that too much of anything is never good. Eat too much linguini and you'll get fat, drink too much wine and you'll get sick, cheat on your wife too many times and eventually you'll get caught, and finally if you spend too much money in the wrong places it can lead you to outright ruin.

Money gets dangerous when we forget that it is only a means to an end, not an end in itself. If that sounds a little cryptic it is meant to sound so. Money can bring you down in many, many ways.

Money can buy a lot of things that are not very good in the long run. If you have a lot of money, people will often treat you with a certain respect. Most of the time they are just after your money.

Do you think the waiter is being so nice to you because he likes you? Of course not, he wants a nice fat tip and if the service is good, give it to him! Same thing goes for bank tellers, lawyers, accountants, maitre d's and anyone who can make a nice buck off your back. But those are usually innocuous enough.

Where it gets dangerous is when you are out of your element and most vulnerable. When that hot chick with the ample breasts and legs that never end can't stop laughing at your jokes and touching you ever so gently in those strategic spots. What does it mean? More likely than not she's after your money, not you.

So don't be fooled. I repeat, do not be fooled. Listen carefully to your friends and your right hand man for advice, they usually see things clearer from the outside looking in than you do in the middle of the storm.

And one more thing, always keep your mouth shut. The less people know about your business, the safer it is.

Is Drop Shipping a Realistic Way to Make Money Online?

Drop shipping, for those who are unfamiliar with it, is a system whereby you promote the products of a particular manufacturer, take orders directly, and the manufacturer/source handles all the inventory and fulfillment functions for you.

In a nutshell, here is the drop-ship system:

==> You generate and accept the order.
==> You take your profits out of the sale price.
==> You forward the order and the wholesale cost to the drop shipper.
==> The source factory ships directly to your customer.

The benefits of this arrangement are probably obvious: No inventory cost to you.

* Substantially higher profits to you over what most regular affiliate programs allow.

* The ability to quickly set-up inexpensive, highly targeted, niche or mini-sites to test and promote diverse products.

This process has been around for years and has been responsible for many highly successful mail order dealer relationships in the past. Many of the top catalogers and other direct response marketers, have been using this system to increase profits for decades. If you have ever ordered a high priced item from a mail order catalog and been told that the product was being shipped from the factory... then you have experienced drop shipping first hand.

Drop shipping is, I believe, a virgin un-tapped storehouse of profits for todays internet marketer.

On-line directories exist which reveal essential contact information for drop shippers of over 2,000,000 products and 4,000 brands. Most legitimate drop ship sources will require that you have a state tax reseller number in order to approve you to sell their products and give you the wholesale pricing you are looking for.

Beware of any drop ship source which requires you to pay a fee in order to become a drop-ship dealer... or requires a membership. These are generally organizations which make their money selling "drop ship licenses"... and are, for the most part, scams. Legitimate drop shippers and factory sources never charge you any fees other than the actual shipping costs of the products you sell.

Another caveat... always make sure that you have a written agreement with the source factory that you own the customer! The factory or drop ship source should agree in writing not to solicit your customers in any form. This is very important to you. Your customer list is one of your most important assets. If the factory you are dealing with balks at this request... use another source who will agree.

Almost every conceivable type of product is available from a drop shipper willing to ship products in single units under your companies name. Pick your interest area... electronics, consumer products, agricultural & industrial products, office equipment & supplies, hobby gear, recreational / sporting goods, clothing, furniture, etc. The list of available products from drop shippers is almost endless.

The products actual source is invisible to the consumer. The seller (you) is able to build a database of customers that he/she owns and controls (by agreement with the manufacturer) and has all the direct marketing advantages that accompany that arrangement... while eliminating the need for maintaining expensive inventory.

This arrangement offers maximum flexibility and cost savings for the seller. If a product does not sell well online you can pull the advertising (web page or mini-site) instantly with very little cost to you outside of the actual time it took to build and test the web marketing effort. Or, since this type of page/mini-site is so inexpensive to maintain and host... you can simply leave the pages online and take whatever orders trickle through... while you move on to the testing and promotion of new drop ship products.

The manufacturer benefits from this relationship by gaining a legion of active marketers promoting their products... at little or no cost (other than those small costs involved with supporting the marketer with online marketing materials like product images, sales materials, etc).

As a marketer you are looking for several key components in developing the drop-ship relationship with a source factory or distributor:


* High Quality Products
* Blanket Product Liability Insurance (if applicable)
* A clear guarantee and return policy
* High Quality Marketing Materials ... product images (gifs, jpegs, etc.), selling copy, other suitable web graphics, etc.
* A Customer Service Department that will work with you to develop the best selling situation for you.

If you are a manufacturer seeking to expand distribution (or an inventor with a new product ) you will find the willingness to drop ship in single units will give you a strong competitive edge while you carve out increased market share at little cost.

If you are an online marketer interested in offering high profit products to your niche market (your website visitors) without incurring high front-end development or inventory costs... then drop shipping is for you.

Internet marketers are uniquely positioned to take profitable advantage of the drop ship arrangement and should give this system a serious look.

Market A Service To Businesses

This is a question many of us struggle with as we see money, freedom, and a bright future for those who manage to find their niche online. You may have tried to sell something from the Internet only to find it is difficult to get visitors to your web site and even harder to get them to buy.

The biggest hurdle is simple: most folks are trying to sell products to consumers. That's not where the money is. It is a more daunting task than most realize.

Only one percent of retail sales happens on the Internet. Even though selling to consumers should be gargantuan one day, we have a long way to go before the majority of people are placing orders the Internet way.

Instead, sell something to businesses. While consumer sales amounted to many billion last year, business-to-business purchases vaulted to a whopping ten times that much. Clearly, if you want the easiest path to tapping into the landslide of Internet cash, sell a product or service needed by business.

So, you say, I should sell a product to businesses? Not exactly. Most products need to be sold in large volumes by many distributors before they turn a profit. Chances are the product you sell is also being pushed by hundreds or thousands of other affiliates. In the end, many business buyers will simply click to the main corporate site to make their purchase.

Your best bet for starting a small Internet business and earning a living online is to sell a service to businesses. Unlike products, it is hard to mass produce a service. Most service providers find their competition is relatively thin. This is especially true if you provide a very specialized service or do your job in a particular way that is hard to duplicate. Because services require time spent by an experienced expert, rates can be high, especially for business customers.

But I'm not an expert in anything people on the Internet would want to buy, you exclaim. Not true.

Sit down with a pen and jot down all the things bosses have paid you for during your work career. Add to your list things you have done on your own time that friends, neighbors, or co-workers have felt were valuable.

Which of these things could be sold on the Internet? If you kept books for a business with twenty employees, you can sell your bookkeeping service to the vast number of small Internet businesses who don't have the time or expertise to manage their growing firm.

If you produced your church newsletter for several years, your desktop publishing and editing skills could fill the hot demand for people who can write and publish e-messaging campaigns, web sites, and print newsletters. Best of all, a writer/editor deals in pure information which is easiest and cheapest to deliver over the Internet.

My neighbor Don decided his skills from a career in law enforcement would be hard to sell on the Internet. But he knew lots of things businesses needed and he had a list of town residents who could fill those needs.

If you don't readily have a service you can sell to business, find someone who does. Many in-demand people don't know how to market themselves on the Internet or haven't the time to try. Represent their service online and take a commission for each sale.

Put up your own web site with some articles business customers will find helpful. They can do double duty, showing you know plenty about your line of work.

Post testimonials from satisfied customers or other experts in your industry. To get full impact, be sure to list the person's full name and the name of their business or city they live in.

Offer to send customers and prospects a monthly update via email. Include brief updates on important developments in the industry. Mix in three line ads promoting your service.

Selling a service to business is your least-expensive way to get started making money online. It is also the quickest way to tap into the huge amounts of money traveling from business to business.

Make Money Online with Turnkey Websites

So you want to make a living online?


Or maybe just as an additional supplement to your current income?


Or perhaps you are a stay at home mom who would like to be able to earn money while staying at home?

The internet is full of opportunities to allow anyone to earn money online. All it takes is an idea, a website and a bit of motivation to succeed. Now you may have an idea, and you may have the motivation, but what you dont have is a website. You might feel like you dont have the techincal knowledge or financial commitment to build a website or have one custom built. Lucky for you, there is a little thing called Turnkey Websites.

Turnkey Websites are one of the hottest ways people are capitalizing on the internet. People who have no idea about programming, coding, designing are earning are living on the internet everyday by using Turnkey Websites. The beauty of turnkey websites is that it costs a fraction of what a custom built website would cost. Since the websites are pre-built you are not paying hourly fees for a programmer to build a site for you..and best of all, the quality of a turnkey website can be as good if not better than a custom designed site! It is perfect for those who would like to try making money online without a big financial committment!

A turnkey website is a fully functional website featuring everything that you will need to begin your new business. The purchase of the package should include a domain, website, and hosting. Depending on the nature of your business, the only fees involved are the purchase of the site itself and a low monthly hosting fee which covers support.

However when purchasing a turnkey website, do not fall under the false assumption that you will immediately start seeing money flow into your bank account from day 1. As with any business, online or not, promotion and advertising are the keys to success. If you have never ran a website before then you want make sure the company you are buying from will provide help along the way. This includes advertising and promotional advice/tips as well as being available to answer any questions you have along the way. The last thing you want is to buy a site and be left hanging without any idea how to promote or advertise it. TurnkeyNation.com is an example of where one can go to purchase a turnkey website complete with domain, hosting, and full support.

Many times people who purchase turnkey websites do not have a large budget set aside for advertising and promotion. Luckily, there are many low cost methods available that can immediately begin making an impact, and even some of the methods are FREE!

Below are my opinions of what I feel are the best and most cost effective methods to promote your site and obtain targeted traffic:

1) Forums - This is perhaps the best and most effective FREE method to obtain targeted traffic. You can sign up for forums related to your website and add your URL to your signature. Then start posting and commenting with useful advice in the forum. Dont sell yourself, just post with friendly advice and people will see your URL in your signature. The traffic will come automatically. This is one of the best free ways to gain targeted traffic online.

2) Press Releases - Write a press release and submit it to all FREE online press release websites. As your press release gradually begins to be aggregated throughout other press sites and search engines, visitors will naturally begin visiting your site.

3) Ebay - Yes ebay may cost a little to post a listing or two, but if you can sell anything at all related to your website (even related ebooks) you can obtain a large amount of quality targeted traffic from eBay. You can begin by creating an "About Me" page on Ebay which directs customers to your website. You will then begin recieving instant targetted traffic and this can convert into sales!

4) Link Building - This is another very effective and free method to obtain targeted traffic. When you trade links with other similar sites, you are inevitably going to receive more targeted traffic. The important thing here is to trade links with sites which are closely related to yours. Not only does it help the visitor, it also helps your organic search engine results.

5) Search Engines - You should submit your website to all search engines and free directories. At the very least manually submit to the top 3 - Google, Yahoo, and MSN. But its best to submit to as many as possible. There are many resouces online where you can pay a small fee to be submitted to 50+ search engines and 150+ directories.

6) Google Adwords - This is a bit more costly than the above methods, however can be immensely successful when done properly. You essentially bid on keywords and then your ad will be displayed throughout the Google network. However, choosing proper keywords and budgets greatly affects your rate of success without draining your bank account.

7) Traditional Advertising - Dont underestimate traditional advertising methods. Even though your business/website is online, that doesnt mean you cant attract potential customers from offline advertising. Although advertising via this method is not free - Classified Ads, local radio spots, tv commercials, billboards, etc. can all drive traffic to your website. And best is if you can advertise to a targeted market where you can cater to the needs of indivduals looking for a service or product your website offers.

I recommend purchasing a turnkey website that interests you, and then promoting/advertising it using free methods. Then once you are generating a profit, you can switch over to paid advertising and invest more money into your business.

The last bit of advice is to not expect overnight results. Granted, you can begin making money from day 1. However, just as a real world business thrives over time, the same applies to online businesses. Once you website has been saturated into the search engines, and once customers begin advertising for you via "word of mouth" is when your business will begin to really take off.

How To Make Money Online

Making money online used to be easier. With fewer websites, it was easier for people to find you. This is not true any longer. Still, some people do well online. What are the secrets of online money makers?

The secrets of online money makers are mostly common sense. If you want to make money online, do something you love. Then realize that this is going to take time and effort.


Many people are looking for quick riches or easy wealth. The secret of online money makers is that they are prepared to work hard. They choose something they love so that they stay motivated. Online money makers learn everything they can about promoting their particular form of making money. They don't expect immediate wealth. They work on their business daily and continue to learn as they grow.

Promotion is a critical secret of online money makers. Promotion helps customers find them. Sometimes the rules of search engines change, and online money makers keep up with these changes. It's what they do for a living.

Good customer service is another essential secret of online money makers. You want customers who will come back and customers who will tell others about you. It's no longer just word of mouth when a business serves somebody well. Now that customer might tell some friends in an email, who will tell other friends, and work can get around pretty fast. They can also post their reviews at various websites, which can gain you more customers.

The secrets of online money makers are not any different than making money any other way. It's about doing what you love, working hard, learning to promote, and serving the customer well. If you can do that, you can make money online.

Reducing Risk With Options

Many people mistakenly believe that options are riskier investments than stocks. This stems from the fact that most investors do not fully understand the concept of leverage. However, if used properly, options can have less risk than an equivalent position in a stock. Read on to learn how to calculate the potential risk of stock and options positions and discover how options - and the power of leverage - can work in your favor.


What Is Leverage?
For the record, leverage has two basic definitions applicable to option trading. The first defines leverage as the use of the same amount of money to capture a larger position. This is the definition that gets investors into trouble. A dollar amount invested in a stock and the same dollar amount invested in an option do not equate to the same risk.
The second definition characterizes leverage as maintaining the same sized position, but spending less money doing so. This is the definition of leverage that a consistently successful trader incorporates into his or her frame of reference. This is the definition that investors must now understand and embrace.

Playing the Numbers
You may believe that if you are going to invest $10,000 in a $50 stock, you would be much better off investing that $10,000 in $10 options. After all, investing $10,000 in a $10 option would allow you to buy 10 contracts and control 1,000 shares.

Meanwhile, $10,000 in a $50 stock would only get you 200 shares. It is easy to see the obvious disparity here and our greed always is seeking a higher potential for profit. Unfortunately, most investors can't see past that. The problem is that there is another disparity here beyond the obvious difference in the numbers of shares an investor can control. This disparity is not so easily seen by investors blinded by greed: risk. (For more insight, see Trading A Stock Vs. Stock Options - Part 1 and Part 2.)

In the example above, the option trade has much more compared to the stock trade. With the stock trade, your entire investment can be lost, but only with an improbable movement in the stock. In order to lose your entire investment, the $50 stock would have to trade down to $0.

In the option trade, however, you stand to lose your entire investment if the stock simply trades down to the long option's strike price. For example, if you own the 40 strike (an in-the-money option), the stock only will need to trade below 40 by expiration for the entire investment to be lost. That represents only a 20% downward move.

Clearly, there is a large risk disparity between owning the same dollar amount of stocks or options. This risk disparity exists because the proper definition of leverage was applied incorrectly to the situation. To correct this problem, let's go over two alternative ways to balance risk disparity while keeping the positions equally profitable.

Conventional Risk Calculation
The first method you can use to balance risk disparity is the standard, tried and true textbook way. Let's go back to our stock trade to examine how this works:

If you were going to invest $10,000 in a $50 stock, you would receive 200 shares. Instead of purchasing the 200 shares, you could also buy two call option contracts. This is because one contract is worth one hundred shares of stock. Therefore, two contracts would be worth two hundred shares of stock. By purchasing the options, you can spend less money but still control the same number of shares. The number of options is determined by the number of shares that could have been bought with your investment capital.

For example, let's suppose that you decide to buy 1,000 shares of eBay at $41.75 per share for a cost of $41,750. However, instead of purchasing the stock at $41.75, you could also buy 10 of the January 2008 (in-the-money) 30 strike calls for $1,630 per contract. This option has an 86 delta, which means that it will mimic the performance of the stock to 86%. If the stock trades up a dollar, the option will increase in value by eighty-six cents. The option purchase will provide a total capital outlay of $16,300 for the 10 calls. This represents a total savings of $25,450, or about a 60% of what you could have invested in eBay stock.

Being Opportunistic
This $25,450 savings can be used in several ways. First, it can be used to take advantage of other opportunities, providing you with greater diversification. Another interesting concept is that this extra savings can just sit in your trading account and earn money market rates. The collection of the interest from the cost savings can create what is known as a synthetic dividend. During the course of the life of the option, the $25,450 savings will gain 3% interest annually in a money market account. That represents $763 in interest for the year, equivalent to about $63 a month or about $190 per quarter. Divide the $190 per quarter by the 1,000 eBay shares that you control and you have created the equivalent of a $0.19 quarterly dividend. (For related reading, see The Importance Of Diversification and The Power Of Dividend Growth.)

You are now, in a sense, collecting a dividend on a stock that does not pay one while still seeing a very similar performance (86%) from your option position in relation to the stock's movement. Best of all, this can all be accomplished using less than one-third of the funds you would have used had you purchased the stock.

Alternative Risk Calculation
The other alternative for balancing cost and size disparity is based on risk. We'll refer to this as "Ron's risk calculation."

As you've learned, buying $10,000 in stock is not the same as buying $10,000 in options in terms of overall risk. In fact, the money invested in the options was at a much greater risk due to the potential of a greater loss, even when controlling a smaller number of shares. In order to level the playing field, therefore, you must equalize the risk and determine how to have a risk-equivalent option position in relation to the stock position.

Positioning your Stock
Let's start with your stock position: buying 1,000 shares of a $41.75 stock for a total investment of $41,750. Being the risk-conscious investor that you are, let's suppose that you also enter a stop-loss order, a prudent strategy that is advised by most market experts.

You set your stop order at a price that will limit your loss to 20% of your investment, which is $8,350 of your total investment of $41,750. Assuming that this is the amount that you are willing to lose on the position, this should also be the amount you are willing to spend on an option position. In other words, you should only spend $8,350 buying options. That way, you only have the same dollar amount at risk in the option position as you were willing to lose in your stock position. This strategy equalizes the risk between the two potential investments.

If you own stock, stop orders will not protect you from gap openings. The difference with the option position is that once the stock opens below the strike that you own, you will have already lost all that you could lose of your investment, which is the total amount of money you spent purchasing the calls. However, if you own the stock, you can suffer much greater losses. In this case, if a large decline occurs, the option position becomes less risky than the stock position.

For example, if you purchase a pharmaceutical stock for $60 and it gap-opens down at $20 when the company's drug, which is in Phase III clinical trials, kills four test patients, your stop order will be executed at $20. This will lock in your loss at a hefty $40. Clearly, your stop order doesn't afford much protection in this case.

Other Options
However, let's say that instead of purchasing the stock, you buy the three-month out $50 calls for $11.50. Now your risk scenario changes dramatically - when you buy an option, you are only risking the amount of money that you paid for the option. Therefore, if the stock opens at $20, all of your friends who bought the stock will be out $40, while you will only have lost $11.50. When used in this way, options are actually less risky than stocks.

Getting back to our eBay example, we will now make our option purchase using the appropriate amount of funds as determined by Ron's Risk Calculation. Keep in mind that the choice of the correct option (month and strike) is also essential to this strategy. For now, we'll look for an in-the-money option with a delta of around 80-85. Let's assume that you believe that the eBay movement will be over in the next couple of months and you want to choose an expiration month that matches the time frame you anticipate the movement will take.

For this example, let's choose the eBay April 37.5 calls with an 82 delta, which is trading at a price of $5.20. Remember, the stock is trading at 41.75 and, therefore, the option is in-the-money. Using Ron's Risk Calculation, you've determined that you can spend up to $8,350, or the amount of money you were willing to lose on a stock purchase as determined by your own stop-loss limit. This will allow you to purchase 16 contracts (at a price of $5.20 per share, each contract would be $520). If you divide the total amount ($8,350) by the amount it costs to purchase one contract ($520), you will get 16.057692 as an answer. This means that you can buy 16 contracts for a total expense of $8,320.

When you compare your stock position and your option position, you will find that you have an equal amount of total dollar risk in both positions; however, your option position will cost you much less in terms of capital outlay - you will control 1,600 shares instead of only 1,000 (a 60% increase). This will likely give you a better percentage return while guaranteeing a fixed limited loss under conditions when a stop order on a stock offers limited protection.

Conclusion
Whether using a conventional risk calculation or Ron's Risk Calculation, determining the appropriate amount of money that you should invest in an option will allow you to use the power of leverage that options can provide while keeping a balance in the total risk of the option position over a corresponding stock position.

Getting To Know The Money Market

Chances are you've heard the term before, but what exactly is the money marketing.? It is the organized exchange on which participants can lend and borrow large sums of money for a period of one year or less. While it is an extremely efficient arena for businesses, governments, banks, and other large institutions to transact funds, the money market also provides an important service to individuals who want to invest smaller amounts while enjoying perhaps the best liquidity and safety found anywhere. Here we look at some of the most popular types of money market instruments and the benefits they offer to the individual investor.



Purposes of the Money Market Individuals will invest in the money market for much the same reason that a business or government will lend or borrow funds in the money market: sometimes the need for funds does not coincide with having them. For example, if you find you have a certain sum of money that you do not immediately need (to pay down debt, for example), then you may choose to invest those funds temporarily, until you need them to make some other, longer-term investment, or a purchase. If you decide to hold these funds in cash, the opportunity cost that you incur is the interest that you could have received by investing your funds. If you do invest your funds in the money market, you can quickly and easily secure this interest. The major attributes that will draw an investor to short-term money market instruments are superior safety and liquidity. Money market instruments have maturities that range from one day to one year, but they are most often three months or less. Because these investments are associated with massive and actively-traded secondery markets, you can almost always sell them prior to maturity, albeit at the price of forgoing the interest you would have gained by holding them until maturity. The secondary money market has no centralized location. The closest thing the money market has to a physical presence is an arbitrary association with the city of New York; although, the money market is accessible from anywhere by telephone. Most individual investors participate in the money market with the assistance (and experience) of their financial advisor, accountant or banking institution. Types of Money Market Instruments A large number of financial instruments have been created for the purposes of short-term lending and borrowing. Many of these money market instruments are quite specialized, and they are typically traded only by those with intimate knowledge of the money market, such as banks and large financial institutions. Some examples of these specialized instruments are federal funds, discount windows, negotiable certificat deposits (NCDs), eurodollar time deposits, repurchase agreements, government-sponsored enterprise securities, shares in money market instruments, futures contracts, futures options, and swaps. Aside from these specialized instruments on the money market are the investment vehicles with which individual investors will be more familiar, such as short-term investment pools (STIPs) and money market mutual funds, Treasury bills, short-term municipal securities, commercial papers, and bankers' acceptance. Here we take a closer look at STIPs, money market mutual funds, and Treasury bills. Short-Term Investment Pools (STIPs) and Money Market Mutual Funds Short-term investment pools (STIPs) include money market mutual funds, local government investment pools, and short-term investment funds of bank trust departments. All STIPs are sold as shares in very large pools of money market instruments, which may include any or all of the money market instruments mentioned above. In other words, STIPs are a convenient means of cumulating various money market products into one product, just as an equity or fixed income mutual fund brings together a variety of stocks, bonds, and so forth. STIPs make specialized money market instruments accessible to individual investors without requiring an intimate knowledge of the various instruments contained within the pool. STIPs also alleviate the large minimum investment amounts required to purchase most money market instruments, which generally equal or exceed $100,000. Of the three main types of STIPs, money market mutual funds are the most accessible to individuals. These funds are offered by brokerage companies and mutual fund firms, which sell shares in these funds to their individual, corporate and institutional investors. Short-term investment funds are operated by bank trust departments for their various trust accounts. Local government investment pools are established by state governments on behalf of their local governments, allowing investors to purchase shares of local government investment funds. Money market mutual funds are further divided into two categories: taxable funds and tax-exempt funds. Taxable funds place investments in securities such as Treasury bills and commercial papers that pay interest income that is subject to federal taxation once it is paid to the fund purchaser. Tax-exempt funds invest in securities issued by state and local governments that are exempt from federal taxation. These two categories of money market mutual funds provide different patterns of growth, each of which attracts different types of investors. (For more, see Money Market Mutual Funds, The Money Market: A Look Back and The Money Market tutorial.) Treasury Bills (T-Bills) Treasury bills, commonly known as "T-bills," are short-term securities issued by the U.S. Treasury on a regular basis to refinance earlier T-bill issues reaching maturity, and to help finance federal government deficits. Of all money market instruments, T-bills have the largest total dollar value outstanding--a sum that as of 2004 exceeded $650 billion. In addition to scheduling regular sales of T-Bills, the Treasury also sells instruments called cash management bills on an irregular basis, by re-opening the sales of bills that mature on the same date as an outstanding issue of bills. When T-bills were initially conceived, they were given three-month maturities exclusively; but bills with six-month and one-year maturities were subsequently added. Three-month and six-month bills sell in the regular weekly auctions, and another bill auction takes place every four weeks for the sale of one-year bills. T-bills are sold through the commercial book-entry system to large investors and institutions, which then distribute those bills to their own clients, which may include individual investors. An alternative is Treasury Direct, which is run as a non-competitive holding system designed for small investors who plan to hold their securities until maturity. Individual bidders on Treasury Direct have their ownership recorded directly in book-entry accounts at the Department of the Treasury. If an investor purchases T-bills through the Treasury Direct system and wishes to sell them prior to maturity, he or she must transfer them to the commercial book-entry system. The transfer can be arranged only through a depository institution that holds an account at a Federal Reserve Bank; the person making the transfer is required to pay applicable transfer fees. Conclusion When an individual investor builds a portfolio of financial instruments and securities, he or she typically allocates a certain percentage of funds towards the safest and most liquid vehicle available: cash. This cash component may sit in his or her investment account in purely liquid funds, just as it would if deposited into a bank savings or checking account. However, investors are much better off placing the cash component of their portfolios into the money market, which offers interest income while still retaining the safety and liquidity of cash. Many money market instruments are available to investors, most simply through well-diversified money market mutual funds. Should investors be willing to go it alone, there are other money market investment opportunities, most notably in purchasing T-bills through Treasury Direct.

Light in the East

It is to be expected that markets run out of puff during a holiday period. The whole basis of sell in May and go away is predicated on wealthy landowners, who owned the bulk of shares in days of yore, closing up their London houses and retiring to the country for the season. Easter may not be quite such a vacational imperative but the streets of the City are undoubtedly quieter and it is not just the recession.
Recent news has not helped sentiment. The British Chambers of Commerce forecasting unemployment well above three million was something I could have done without and finding a pundit prepared to predict a turn in the fortunes of the economy before the end of the year has become well nigh impossible.
Watching George Soros on television last week saying that the bear market has further to run did not make me feel too comfortable either.
So it comes as little surprise that the market is running into sellers whenever it pokes its nose above 4,000. True, there is plenty of evidence pointing to sufficient bargain-hunters emerging to provide support as we approach 3,500 but it is a very narrow trading range that has been established. It is bound to break out one way or another soon. The question is, will it be up or down? And how far might it travel?
Trying to position portfolios against the conflicting pressures that are assailing markets has become most managers' abiding aim. In the absence of second sight, finding the right mix is proving difficult. Much of the perceived wisdom developed over successful asset allocation strategies has proved to be flawed. These markets have seen governments humbled and investment stars dimmed. It all adds to an unwillingness to take any risk.
Meanwhile, on the other side of the world, evidence is growing of a rebound in activity. Some commodity prices have recovered significantly while workers laid off because of an absence of orders are being brought back.
Microchip output has risen significantly after a most depressed period. Acer, the world's third-biggest computer manufacturer, has reported a jump in orders. Are these true green shoots or merely the end of destocking?
We will find out soon enough but in the meantime, my money has to be on the breakout coming on the upside rather than the down. While I may enjoy some heavyweight support in this positive stance, there are plenty of serious players placing their bets the other way. Aside from the legendary Soros, the analytical powerhouse of Morgan Stanley published a strategy newsletter last week entitled, Bear Market Is Not Over: Selling Today.
They look for three signposts to flash green - earnings, US housing and bank balance sheets. None are. But the fact remains that this global economic setback is hastening the establishment of a new world order.
China truly needs continuing growth to keep its burgeoning middle class on side and to stifle the cries of the massive underclass that still exists.
A slow US recovery will not help but America is no longer the only game in town. In a reversal of the old 19th Century cry, it is time to go East, young man.

The Global Household appliance

Over the past quarter of a century, the global economy has become increasingly reliant upon demand growth from the world's biggest consumer - the US household sector - to engineer recovery from recession. This time, the customary mechanism for stimulating US domestic recovery, and thereby world trade, is broken.

Given limits on credit availability, the authorities need to find an alternative way to increase households' real disposable income. In the medium term, the best method of doing this is, of course, through jobs growth. However, this can take a while to have an impact.
A faster, though less sustainable way, is through tax cuts - both to households and businesses. The big tax cut route is limited, however, by fiscal deficits and by the fact that the banking sector's liabilities need to be covered before "clean" lending can resume in the global economy. This involves adding big numbers to the already big amount of government debt.
Net savings nations, such as Japan, can much more easily use tax cuts than net debtors. They can simply divert domestic investments into government bonds. However, the US and UK are net debtor nations, with foreign investors owning approximately one-third of US Treasuries and UK Government bonds.
As a result of the difficulty in stimulating US consumer demand, we have been reducing our equity exposure to Western economies and tilting investments toward Asian companies with strong cashflow generation and those undergoing structural growth.
Given that a proper recovery cannot even begin until the banking system is fixed and the banking system cannot be fixed without a genuinely global solution (which does not look to be immediately available), the US authorities' very short-term priority will be getting money into the household sector. Tax handouts and employers' incentives designed to encourage spending and job creation are the order of the day. When the Obama stimulus plan finally gets enacted, it is very likely to encompass these core characteristics.
These measures are likely to help slow the pace of deterioration in the real economy and, hence, we expect to see improved macro indicators by the middle of the year. However, it is important to keep in mind that, compared with the near immediacy of credit-fuelled recovery, the positive impact of tax and employment incentives only becomes evident over a longer period. Thus, in our view, a recovery which is prone to setbacks seems more likely than in any previous cycle.
This has led us to reduce exposure to equities and to increase to asset classes such as gold, which is expected to relatively outperform given its safe haven status, and to property, where the valuations are at an extreme level.
Government bonds are delivering positive absolute returns again, particularly index-linked bonds. This has been largely aided by government agencies manipulating the price partly through buying their own paper in the market.
The US and UK authorities are over-supplying money and will continue to do so until it "sticks". However, it is worth reminding ourselves that in the history of the bond market, there has never been a sustained statistical relationship between government supply and price/yield.
More recently, the experience of Japan tells us that it is eminently possible to have government yields as low as 0.5 per cent in the face of supply well over 100 per cent of GDP. Despite concerns over supply, we maintain a positive view on government bonds, particularly index linked bonds, given their ability to act as a hedge against inflation.

The Great Business Thinking

Industry and public concern over counter-party risk following the failure of Lehman Brothers has increased demand for more effective protection strategies in the structured product market.

Gilt-backed structures, collateral strategies and early kickout options are increasingly popular among providers as a way of mitigating risk but they do not come cheap and advisers are divided on whether it is a price worth paying.
Last September, BNP Paribas launched two structured open-ended investment company funds, stabiliser and stabiliser plus, under its newly launched Privalto UK brand.
The six-year plans offer 100 per cent capital protection and potential for growth through an absolute return strategy via the multi-asset absolute return BNP Paribas millennium 10 Europe excess return index.
Backed by AA+ rated BNP Paribas, the funds tackle potential credit risk by placing collateral in the form of AAA-rated G7 government bonds with a third-party depository to reduce potential exposure to the underlying counterparty.
However, while the Oeic structure provides investors with cover from the Financial Services Compensation Scheme if it is unable to meet its liabilities, it also means the fund's holdings have to keep to Ucits rules.
BNP Paribas retail structured funds director Sisouphan Tran says: "You can create a classic structured product very quickly. It is something that is very flexible for a bank or product provider to issue in the market.
"We have limitations on what assets you can put in the Oeic, as not all are eligible under Ucits rules, such as hedge funds or holding pure commodities, for example."
Tran acknowledges it is easier to promote capital- protected products in the present climate as investors are more anxious and looking for so-called "safer havens" for investment. But he says: "I hope when we return to a bull market, people will not forget what has happened today.
Tran believes that more collateral-backed Oeics will appear on the market in the future but says this will not happen overnight.
He says: "Logically, you should see more of these types of funds as opposed to the classic debt securities-based products. It will take time and it will require a lot of investment from companies which is not very easy to do in the current climate."
AWD Chase de Vere senior manager Jason Walker says the firm is already seeing a number of more classic structures emerging on the market which use gilts to provide security. He says: "You are paying for the protection on BNP's stabiliser by going into it as an Oeic but at the moment that is something some clients are prepared to pay for."
Aviva is another provider planning to launch a structured product within a Ucits-compliant fund structure.
To mitigate risk, Aviva intends to only use an over-the-counter derivative from a counterparty that meets certain credit rating criteria and will employ collateral arrange-ments through government bonds.
Truestone client director Simon Bullock says gilt-backed structures are very safe but very expensive compared with classic structures which only use one counterparty.
He says: "BNP's structure is quite new, quite clever and different but I am not sure what kind of upside you will get with that kind of cast-iron protection. If you get a significantly better bang for your buck because you are happy going with one specific counterparty rather than a basket of G7 gilts, the model might remain niche. It may suit discretionary managers but for advisers it would be very difficult to talk through. It has probably got a place but I am not sure it will take over."
Low interest rates, reduced stockmarket volatility and falling gilt yields mean it is becoming increasingly difficult for providers to structure protected investments that can still offer a competitive payout.
Boutique provider Quantum Asset Management temporarily pulled out of the market last week after struggling to structure products competitively and Morgan Stanley was forced to cut the annual kickout by 1.75 per cent on the latest tranche of its FTSE defensive AAA gilt-backed growth plan.
Tran says it is very difficult to create protected investments which will provide good potential upside for clients at present.
He says: "We launched the funds before all the interest rate cuts and there is a lot of demand from the market to launch a new stabiliser with full capital protection but I am not going to do it now because the participation in the absolute return strategy would be dramatically lower."
He says the first generation of stabiliser products will be the flagship for the firm's protected investments range while it considers alternative solutions to complement it. Options under consideration include reducing protection to offer cheaper alternatives or offering direct access to the underlying strategy without capital protection.
Lowes Financial Management managing director Ian Lowes says: "Volatility is down at the moment which is tightening up the pricing on kickouts. You can have all the demand in the world for a kickout contract but if it is just not viable, no one is going to offer one."