Pic by Docpop

Are you an executive at a nonprofit avoiding communication due to debt? 

A simple pattern emerges for those nonprofits who are struggling and which ones ultimately succeed in surviving .

Those that overcome the struggles have been more forthcoming and communicating with all parties and trying to work things out. 

The nonprofit that goes into silent mode and ignores creditors and concern entities closes.  It’s called complete failure.  A failure to communicate. 

 So instead of waiting for a miracle, put a plan together that is workable and present it.  Otherwise the nonprofit will be gone and forgotten soon.  Good intentions and good faith efforts work in most cases.

pic from Nine Inch Nachos

It is my position that Credit Unions are much better at providing the best value for the fees they charged and the services their members receive.  I think it is time for the government to cut the cord of taxpayers supporting the for-profit banking sector.  I would like to hear feedback from the nonprofit community about reasons the organization does not utilize Credit Unions for their banking needs.

So far “I just never thought about them as an option”  has been the strongest response.

From the Wall Street Journal: 

President Obama supports the teamwork environment that doctors of the Cleveland Clinic in Ohio work in on a daily basis. Rather than having doctors work independently, thus increasing costs, the Cleveland Clinic has doctors from the same speciality collaborate together to figure out the best treatments for patients.

In a perfect medical world, patients wouldn’t need to pay for second opinions they’d be told them by the group of doctors working to help them get better, no extra fees.

 From the Wall Street Journal:

A tax on health care insurers is an interesting way to boost our economy. Of course, with these taxes placed on insurance providers, the employers who offer health care packages exceeding a certain price would have to pay most if not all of the tax put on insurance providers. If an employer is charged to pay for taxes than more than likely an employee will have a smaller pay check every month. Americans may not like that idea, but it is a price we will all have to pay.

pic from NINE Inch Nachos V

Credit Unions

Investing for its members.

Managing its products for its members.

Providing products to its members they need at a good price.

Profits go back to the Credit Union for  its members to use.

As a nonprofit itself, it knows how to serve the community.  Nonprofits and their employees just might want to consider to have Credit Unions as a part of their network.

pic by Eli the Bearded

In January the savings rate rose to 5%.  The highest rate in about 14 years.  To the degree possible each of us should have three months worth of expenses saved for emergencies.  The same is true of any business.

The recent credit freeze on businesses only underscored this truth.  Credit lines are available at the discretion of the financial institution.  The use of savings and credit lines together are the best tools for businesses to have.

Nonprofits seem to be doing a better job  in cutting costs and adjusting to the market place than than government.  The government should learn to work more like nonprofits before they owe too much.

The cost of a college education, the need to lower health care costs and a budget deficit need to be resolved together.  The nonprofit community can help with the three components.

1. First is the linking of jobs that are eligible for loan cancellation to those attending college.
2. The second is working with government to create a national health insurance system since many nonprofits depend on federal and state funds for portions of their programming or donations.
3. The third component as it relates to budget deficits needs to be dealt with by those organizations whom own large amounts of property exempt from taxation.  Local services are very dependent upon property taxes and certain organizations such as universities, churches and medical facilities are some of the largest landlords. Congress should pass a bill that allows for a user fee to be set per thousand for any community where any net holdings worth above $10,000,000 are controlled by any one organization regardless of federal ID number.

pic by 7ups

I find actions by the Treasury, Federal Reserve and the SEC of keeping information private in order to not adversely effect the market, very disturbing.  By keeping information private they are manipulating the market and therefore the news that investors have must be considered suspect and not the whole truth.   However, information is now internal to the companies involved and some of the larger investors.  Thereby, giving certain financial institutions and large investors inside information.

I find that the cartoons circulating can sum up the Government and Wall Street being a bunch of clowns just trying to entertain everyone to keep their mind off the real problem.  This provides Government and Wall Street the opportunity to do little and keep it more or less the same.  It is time to be open, honest, enforce the rules and make everyone accountable to the same rules.

However, the SEC has the time to make waves about Corporate Blogs and Twitter posts which are much more public.  Companies making public statements and letting the public decide how to utilize the information from companies is what investing is about.  The SEC job is to enforce whether the information is truthful or not.

The courts have repeatedly shown that stating information as a current fact when it is known to be lacking other facts that would otherwise influence an outcome can be considered fraud.  Those companies that have been shown to perform intended manipulation to gain an outcome are those companies that are severely punished for years by investors.

While the truth hurts in the short run it is more important that all investors can trust the information  they use to make informed decisions.

From what I am  reading, hearing and seeing organizations and individuals are growing tired of the lack of transparency and have acted accordingly.  Thereby, creating the wide swings in the market.

cartoon by YoSpilt

On the surface when one invests for their future it is important to understand what your investing in.  Auction rate securities were suppose to be ultra safe bonds that were sold by financial firms as cash like securities.  Without warning the auction rate market closed.

Who got hurt the most: municipalities, hospitals, universities and many other types of nonprofits.  Cash flow suffered on two levels.

1. First, organizations were locked out of accessing their money.
2. Two, organizations needed to increase their borrowing to cover cash needs at higher rates.

Safe is suppose to mean that ones cash is secure.

If your organization was effected file a compliant with your state Attorney General and the regulators for the financial institution that provided the investment.  Making them honor the terms of the bond as like equivalents takes work. If that does not work it may be time to reach out to an Attorney.

Do not let the delivery of the product be dependent upon outside influences.  Hold the financial institution accountable to their actions to deliver upon what you bought.

cartoon by Fuller

Times of economic stress are not the times to cut off communication with the external community.  It is the opposite that you should be doing.

• Forecasting is an important tool to use for bench marking ways to measure the organizations health in an ongoing manner.
• Forecasting is the means by which managers can gauge what variables to measure each month of the year.
• Thus providing managers established targets for analysis.
• Thus providing measures which will trigger adjustments.
• Thus providing the case for implementing the contingency plans which have been drawn up during the planning process in setting the bench marks for forecasting.

Nonprofits should be showing and involving its community of supporters and teaching them the range of variables that they should be measured by.  Half the battle is identifying for the organization what those variables are?  Until you do, do not expect confidence from your community of supporters.