First World Nation
status is ultimately measured by the level of financial sophistication of the
nation’s population, as it pertains to national, corporate and individual – expenditure,
revenue and (debt/equity) reserves. Money, similar to a bathroom scale or a kitchen
thermometer, is only a measuring tool used to value tangible and intangible items
and all must learn to use it. Investing in productive and administrative
activities, to generate sales revenue and returns on investment, in order to
repeat and grow other opportunities.
Individuals and
family units, also referred to as households, must not be afraid to frequently adjust
basic living expenses; foods, shelter, transport and communication, to seek minimum
pay to cover the cost plus; price increases, prorated expenses and savings. Financial
literacy, taught too many through credit unions and insurance agents, guides
persons to understand the need to save 6-12 months of their basic living
expenses as reserves, to cover short periods of job loss. Such persons must
therefore keep their eye on international news and local circumstances that
will directly or indirectly affect their employment.
Corporations, small
and large, inclusive of self employed; the nuts-man, the mechanic, will constantly
adjust expenditure; to maintain markups, to reduce administrative cost and to payout
a competitive return to its owners, before pricing its products and forecasting
minimum sales volume. Financial projections, taught in business schools, guides
managers to appreciate the need to set aside and invest 1-3 years of the basic
operating expenditure and windup cost as reserves, to cover periods of low or
no demand, as an exit strategy. It is wise to remember that the company’s
owners are, in most cases, also employees and will suffer the same faith, along
with loss of investment, if the operation closes.
Nations, democratic
socialist, where every citizen is an owner, finds it very difficult to adjust recurrent
expenditure; cutout waste, reduce mismanagement and root out corruption, before
forecasting revenues from minimum tax based income and examining its ability to
fund development plans. The national budget, guides accounting officers; to set
aside 6-12 months of foreign import cover, to implement policies, which have
received prior executive cabinet approvals within the budgeted figures and no
more, to charge and collect taxes, duties, fees and fines, as sanction by law.
Such cabinet members, elected officials, are not in charge of public money but
do set and oversee policy, carefully guided by future revenue projections.
Hence, Everybody, Employees
and Employers must easily value their Moral Integrity, Corporate Loyalty,
National Pride, investing labour, skills and other resources, as contributions
to nation building. Recognizing and planning for risks that can and will retard
progress; drastic falls in revenue, global commodities uncertainties, workers’
protest, social unrest, natural disasters, climate change, etc. but the most
immediate threat, to all, is the increasing size and crippling nature of the total
public debt, inviting the IMF.
Rationale
T.A.J & Associates Company Limited uses this occasion to comment on topics that have been covered, both academically and by the mainstream media, to add its opinion and point out investment opportunity, not to invoke any social action.
