PARAMUS, N.J., May 22, 2012 /PRNewswire/ -- America's national debt as of April 2012 is $15.69 trillion, which effectively translates into a debt of $50,061 per US citizen and a debt of $138,255 per US taxpayer . With the real rate of unemployment is well over 10%, the recession is still biting. The government does not want to tinker with fiscal policies because elections are around the corner. These bits and pieces may seem like routine business statistics, but may well land a sledgehammer blow to American businesses that are steeped in debt and reeling from the prolonged recession.
American businesses want the economy to get going, but the government has been lulled into slumber after the recent S & P downgrade, which first shocked and then pleasantly surprised. After the American sovereign rating was downgraded, economists expected that investors would get nervous and capital would take flight. But the economists were proven wrong. Investors and countries actually invested in US debt because the dollar is the world's No 1 reserve currency. No country wants to pull out of US assets because such a move would ruin the global financial architecture. After investors reposed their confidence in the USA, the government went back to business as usual thinking all was well .This has left American businesses disappointed.
Now the time has come for all American businesses to realize that there is a problem at hand, which must be tackled head on. If the national debt keeps on piling up, and the economy keeps going at a sluggish pace, the next downgrade could create a new nightmare for American Businesses – some of whom are already struggling to stay open.
But what can American business owners do to help themselves? Some seem uncertain of how to move forward. According to Ben Bernanke, business owners delay investment and hiring decisions when the future is uncertain, like it is now .
For starters, a business owner must understand that these factors work out to a triple whammy. One, we have the recession and policy uncertainty pulling businesses down, two, businesses steeped in debt and hit by the recession are unable to repay debts, and three, many business owners will not expand or invest unless there is policy and economic clarity. They must know that bad debts and unemployment are rising and investment is falling in a dull, cloudy and murky economic mess.
American business is at a standstill now. Inventory, receivables and assets are pledged, personal guarantees are at risk, checks are bouncing, sales are low, employees are being let go, little money is coming in, lot of money is flowing out, financial pressure is mounting, and indicators point to things getting worse.
Therefore, every American business must first look in the mirror and then inward. They must realize that borrowing money to resolve old debt problems may not be the solution and that whether its for the government or Main Street USA, hiking the debt ceiling is mere cosmetics and does not address the real problem. .
The solution for many American Businesses is to bite the bullet and opt for debt consolidation or business restructuring. They must control spending, balance budgets, scrimp and save, and get back into shape on their own because there appears to be few options available to help them. If they don't, their chances of survival could be at stake.
For more information on avoiding Business Bankruptcy, or to contract:
http://www.business-bankruptcy.com or call 866.876.5938.
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Paramus, NJ 07652
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SOURCE Corporate Turnaround