Friday, October 24, 2008

Business Plan That Will Immediately Restore Real Estate Values

Government bailout without a business plan of how to dispose of the troubled housing stock will fail as housing inventories continue to decline without a buyer. This will further decay housing values, increase the cost of the bailout and make for a deeper economic pullback. Any solution that does not include getting products off the books of the government and the tax payers and into the hands of investors or buyers that are willing and qualified to bear the risk of ownership will fail.

The exact solution to shoring up real estate values immediately is laid out in this article:

1) Create a Business Plan to Immediately Dispose of Housing Inventory Create a simple and executable business plan that would involve experienced real estate investors and entrepreneurs who can manage and acquire the risk of the current real estate inventory. This should result in relieving the government of the existing problem, shore up real estate prices, stimulate the economy and use the experience of Americans across the country that handle real estate for a living.

2) Evaluate
Put together regional real estate teams to immediately access every troubled real estate asset on the books. Just the assets from Fannie and Freddie alone would relieve the system. These evaluation teams are very easy to put together and are available for work. Their job would be to evaluate today's property values based on rental income returns with set asides for vacancy and expenses allowing for positive and attractive cash flow to investors. This would make these properties appealing for immediate purchase by qualified investors (see 2 below). This is critical, otherwise the tax payers will have to wait on the housing market to return before these properties are purchased causing homes to sit vacant in neighborhoods for years.

3) Make Assets Available to Qualified Investors
Once values are assigned make these assets available to qualified investors in each regions. These qualified buyers and investors would have to be experienced with real estate. This will allow them to quickly evaluate property values and act. They must have a proven history of managing this type of real estate asset and (very important) have a history of perfect loan repayment with these types of assets. It is critical that we don't wait for just individual home buyers to purchase these properties as they will not move fast enough to dispose of the product and shore up pricing. Bringing investors into the market will stimulate qualified home buyers and they should be allowed to bid on these properties along with the qualified real estate investors. This will stimulate real estate immediately and shore up housing prices.

4) Make Financing and Incentives Available
Provide the market financing and tax incentives below to qualified buyers and experienced investors in each region, which reward the risk they are taking on. These groups or individuals would have to have the following in order to qualify for financing and incentives:
a) A perfect repay history on all debts they have ever incurred involving real estate transactions.
b) Use of their own cash in order to obtain favorable financing terms (cash down is a must as no money down transactions is part of what created this mess).
c) Investors must have a net worth significant enough to support the properties in transition so that these properties do not come back into the market. Government incentives whereby depreciation schedules are advanced to further enhance investors' risk (like the GoZone Tax Incentives used after Katrina), must be put in place.

These simple steps will open up the use of money again, shore up real estate prices immediately, get action into the market that has stagnated, ensure that the government (taxpayers) is paid back quickly, and stimulate the economy by putting people back to work at titles companies; escrow companies; bank lending; mortgage brokerage firms and real estate firms. They will also alleviate any continuing decline in real estate values.

There are financially qualified investors sitting on the sidelines today waiting for the bottom in real estate before they become active again. This is a problem and they must be encouraged into the market.

My plan will take time out of the current situation and provide a true solution for a successful bailout and ensure that the tax payers are handled while jump starting the economy. While Government is saying it is vital they sign this 700b bail out bill immediately, the signing of the bill will not dispose of the problems.

Government cannot successfully manage the expedient disposition of these properties without the cooperation of real estate experts in each region. The RTC took years to get rid of product in the late eighties and real estate prices suffered longer than necessary as a result.

Without investors and entrepreneurs brought in to the solution, real estate will lag for 3-5 years or longer just in disposing of the properties. Our economy cannot afford this.

Please forward this plan to anyone you know in Congress as I would be happy to assist in the implementation of this solution. It is critical to each of us that our real estate values are shored up immediately, that homes don't stay vacant, hurting the entire neighborhood, and that our economy gets a stimulation of production and hope.

Grant Cardone,
Author and Real Estate Expert

Tuesday, September 30, 2008

America Rewards Incompetence

When did America become the place where a person or a group gets rewarded for failing? Take heed, the rewards for failure appear to be reserved just to that group of "preferred cronies" of the Treasury, Congress and others in power. It is worth nothing that Paulson came from Goldman Sachs and notice who is getting saved? Can you imagine the government rewarding you or I for the same failures. We could start a business, violate every basic and logical business principle that exists, take every possible risk outside of the area of expertise and then when it fails we would go to the government and ask them to bail us out. This is so outrageous it is impossible to think with and then leaves you with only some sense of the gravity of the amount of incompetence that is writing the rules for how our country's financial systems work or don't work.

I am unable to even think with the current actions of Wall Street and Congress over the last six months. In July of this year I wrote "Neither the Fed Nor Popular Financial Advice Provide Economic Solution." The problems being confronted today started much earlier and we all have some responsibility in creating this situation by our allowing these kinds of actions to continue on without the people involved in them being penalized. The politicians on both sides get to stay in office and the CEO's running these companies into the ground walk away with big paychecks!

I have spent my entire adult life building businesses on the Main Streets of America and anytime I failed I never considered that I would ask someone else to bail me out. My businesses are not intricately tied to the workings of the dollar and can not negatively impact our money supplies and that is the point! They are separate and should be kept separate. I succeed I am rewarded, I fail and I am penalized! These companies being bailed out today are too tied to government and that was approved by our current congress. The most you or I will get for our failures is some advice, a pat on the back and maybe a motivational pitch that we can bounce back but neither of us will get bailed out.

If you wreck your car do you expect the government to fix it? If you end up with a drug or alcohol problem should the government send you to treatment and then hang in there with you until you are all cleaned up? If you are an actor and can't get work should the government find a movie part for you? If you lose your job because the company you worked for no longer finds your position valuable to the company should the taxpayers (the government) pay you not to work? This reward of unemployment to individuals is another form of rewarding people for not being of value. Incompetent CEO's that are allowed to make multi-million dollar contracts to run a company into the ground is criminal and should be treated so.

If I take too many risks, mismanage money, become unable to sell my products, miscalculate the market, and then mismanage my company I am going to get worked out of the system. But that is not what is happening today. Most of these CEO's that mismanaged their companies will be allowed to come back and do this again. The politicians that approved laws allowing brokerage firms to become lenders should been removed from office due to their actions.

You and I are paying for the mistakes of others and then for not standing up as a group and saying enough incompetence! If you are incompetent and make poor decisions, then you should not be allowed to serve in any capacity and should be labeled as incompetent. I understand that the current actions with AIG and GS may be necessary to not further a meltdown but the same people that got us here should not be left at the helm of the ship. How dare any of us stand by and entrust those proven to be incompetent with 1 trillion-plus dollars. Does anyone think that they will change their behavior and not screw that up by rewarding their buddies with how that money is allocated?

The guys that ran these companies parachute out with millions and will throw back martinis at the country club while the rest of us pay for their mistakes. These guys shouldn't even be allowed to work on the street again. They should be labeled, much like a sex offender is, in order to save the rest of us from them repeating their actions. And those in Washington on both sides that have approved any laws that contributed to this disaster should be removed from office immediately and also labeled incompetent. There is no downside for these guys making poor decisions and because so they have no real cost.

When did we become so soft, so forgiving and so reasonable as a nation with those we elected to leadership. If a doctor kills too many patients he loses his license. If a teacher is unable to get her classes passed they lose their job and won't be able to get another one. Where is the accountability with our leadership?

The problem here isn't the Republicans or the Democrats but the idea that the American population sits back in apathy and does nothing and there is no cost to those that elect to lead for actions and decisions that later prove incompetent.

Grant Cardone is an Author and CEO.

Friday, September 19, 2008


Nothing will get you through these economic unusual times more than getting back to effectively selling your products, your services and your company. It is more critical at this time than ever that you learn everything there is about selling, negotiating and closing.

Those that are able to effectively sell will survive and those that can not will suffer. At no time in my life will the mistakes a company and its people make with regards to selling be more expensive than right now. Even the smallest mistakes in selling will be greatly expensive running off customers and opportunities. SELL SELL SELL-nothing else matters. The management teams that spends less than 95% of their time on selling will find itself going backwards. "The only reason a business or an individual will fail is the inability to sell their products and services at prices high enough and in quantities great enough!"

95% of all the energy and efforts of the company, management and its people has to be on selling. Advertising and marketing are important but if they don't result in sales the company will abandon those efforts due to its lack of sales.

Management's daily attention must be on:
1) ensuring people's attitudes are positive,
2) effective 21st Century selling skills (not just old school tactics),
3) effective negotiations in order to maintain gross profits,
4) how to close the deal so that your efforts actually hit your books

While much of management is looking for ways to figure out how to reduce expenses nothing will get a company through these times more than increasing the gross sales line of its income statement. Nothing else matters at this time more than selling. ONLY THOSE TRAINED DAILY ON HOW TO SELL WILL SURVIVE!

Grant Cardone, (about Grant)

Tuesday, April 29, 2008

Grant Cardone Bio

Grant Cardone has been speaking to audiences for over twenty years helping hundreds of thousands of people to improve their incomes, their businesses and their lives. His very fresh, highly ethical approaches to business expansion, management and sales have revolutionized entire industries and have directly resulted in billions of dollars in production.

In addition to as many as 150 speaking engagements a year, Grant has proven himself a successful entrepreneur and businessman. He is CEO of three multi-million dollar businesses: The Cardone Group, based in Orlando, Florida, Cardone Training Technologies in Los Angeles, California and Cardone Real Estate Investments. He also has a sales and management school in Orlando called The Cardone Institute.

He applied his business acumen and principles to the real estate industry only twelve years ago and has since been involved in over $200 million worth of real estate transactions creating a real estate portfolio in excess of $100 million. In addition to all these activities he has been the guest on over fifty radio interviews as well as the Today Show, Access Hollywood, MSNBC, and had a television show on ASTN called Cardone On The Floor.

Mr. Cardone presently lives in Los Angeles, California with his beautiful and successful wife, actress Elena Lyons. Look for his next books, Breaking Out From the Middle Class and The Closers’ Almanac coming soon!