Is a worldwide recession already underway?

The Chief Economist of U.S invesment bank Merrill Lynch believes so. According to his analysis America is now into the first month of a recession, defined as two successive months of negative growth.

Other commentators think it could be longer than that, while some, like Irwin Steltzer, speaking on the BBC’s Newsnight, believes sovereign wealth funds will allow the banks to re-establish their balance sheets and avoid a banking crisis.

For an analysis of the coming recession on both sides of the Atlantic see John Evans’s article in Syntagma.

He writes, “All banks are now hoarding cash like Ebeneezer Scrooge on a bad day and virtually ceasing to lend. With house price indices slithering down a slope like novice ice skaters, and inter-bank rates running at around 8 percent, this has become a total banking crisis worldwide, and that has the potential for real evil in our economies.”

Read the article here.

We will shortly publish an updated piece on how to avoid the worst effects of a recession in your personal finances.

Ever dreamed of quitting the day job to forge a new business online? It sounds simple enough : working from the comfort of your own home, low costs and master of your own time?

But what about the complications? The technical side, for example. The long lead-ins to a sustainable income. And, of course, the intense competition for a large, but limited pot of money on the internet.

John Evans, who founded Syntagma Media — an internet content provider — has given an interview about the trials of creating an online business to Gerry Reynolds, business consultant and retail analyst.

Here’s a sneak preview :

Gerry : What are the economics of an online income stream? […]

John : If you set no upper limits, you’re really at the mercy of events. It’s no good having a $10m business if your costs are $11m. Mr Micawber defined that problem 150 years ago.

The trick is to set an upper boundary that gives you the best split between receipts and obligations, building in the vagaries of the tax system, of course, and depending on the amount of effort you can comfortably provide. Everyone will reach a different conclusion, but it has to be within your comfort zone. You are, after all, in this for the long haul.

Read both posts here : #