Archive for September, 2009

Investors Turning to Socially Responsible Techniques to Earn Returns in New Markets

Due to rapidly changing social attitudes and a faltering economy built by practices many economic and scientific experts see flaws in, investors are turning to a new style of investment practices known as Socially Responsible Investing (SRI). According to a study published recently by the International Finance Corporation. This report addressed sustainable investment opportunities in emerging markets around the world. Another report from UBS Wealth Management Research, titled “Emerging Market Equities: Sustainable Investment Opportunities” addresses the numbers of investors allocating assets in these new markets.

According to the UBS report, investors are embracing SRI in emerging markets to the tune of $50 billion, as of the second quarter of 2008. An additional $250 billion in assets were being stewarded by non-SRI focused investment managers who have begun taking economic and social factors into consideration in regards to their investment choices. These figures signal a shift in investor mentalities and are being viewed as proof that there is more to the much lauded “green revolution” than was previously believed in terms of investor confidence. These figures are particularly striking in light of the fact that a global recession is underway.

Key areas of interest to SRI investors have become affordable homes in Latin America and sustainable vehicles in China. Renewable energy sources such as solar cell production and biofuel refinement factories are also areas of strong interest for investors in many different nations.

The UBS report concludes that investors considering the switch to an SRI-focused portfolio will be, “investing in companies that contribute to solving environmental and social challenges in emerging market countries.”

Small Business Sector Leveraging Lenders to Stay Afloat in Tough Economic Times

The high levels of unemployment due to a faltering global economy is leading to massive job losses and record levels of unemployment. The percentage of unemployed workers stood at 5.7% in July of 2008 and as of July 2009 it has reached 10% according to figures released by the Bureau of Labor Statistics. Many people are facing trouble finding work and as a result, a large segment of those people are turning to other opportunities as a means to make ends meet. This has lead to a growth in the micro business sector that ranges from internet based enterprises to companies offering skilled services to their local communities.

The economic climate at the beginning of the millenium gave rise to many opportunities in the small business sector and at this time many of these business owners took out loans. In today’s riskier economic climate, cash flow is a concern for many entrepreneurs and as a result, the lending market is responding with alternatives to make the process of obtaining a small business loans faster and easier so that these business owners have access to more cash. For many start up businesses this has made a huge difference in their ability to deliver their product or service at levels that will ensure their profitability.

As consumers shift their spending habits to deal with the global recession, small business owners are having to adjust their strategies in an equally rapid manner in order to avoid losing out on profits. A large percentage of these operations are taking out a business cash advance when they need to make a rapid change in their business model or test out an alternative advertising method. According to these business owners, this small shift in liquid assets is making it easier for them to avoid missing out on opportunities that arise faster than traditional bank loans would allow them to engage.

Overall, economic experts predict a worsening economy with rising unemployment for a few more years while small companies move in to take over segments of the market that are not a focus of large corporations. This re-distribution of economic activity is seen as the key indicator that small businesses will lead the eventual economic recovery in the coming decade.