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Peak Performance Resources for Leaders by Leaders

Category: Business Page 1 of 3

Blame Game

Accusations exchanged between people who refuse to accept responsibility for an undesirable event, loss or failure. Finger pointing and scapegoating are common techniques used to divert attention and focus on a person who is assigned fault. Whenever money is lost, emotions run high and the Blame Game kicks into high gear.

Conventional Wisdom

The ideas, explanations, and beliefs that are generally accepted as true by the general public or experts in the field. Though widely held, these ideas and pieces of advice are neither examined or validated. Many of these thought forms are no longer true (if they ever were), perpetuating them maintains the status quo.

Niche

A small, profitable segment of an existing market. It is easier for new companies, projects or start-ups to gain a competitive advantage and to dominate their field by focusing on a small market, versus a highly served large market. This is counterintuitive for most people because they think there are more opportunities in large, established markets.

Liquidity

1. The state of being liquid. 2. The quality of being readily convertible into cash: an investment with high liquidity. 3. Available cash or the capacity to obtain it on demand. 4. The ease with which an asset can be converted into money. Cash is liquid but shares in a company are less liquid because they must be sold in order to convert them into money. Assets such as property are even less liquid because they take longer to sell than shares.

Globalization

The process of worldwide interaction and integration of people, companies, and governments. For thousands of years, people have been trading with each other across long distances and in the process shared ideas, beliefs, and culture. The opening of borders, reduction of tariffs, the free movement of people, goods and capital, music, movies, combined with reduced transportation costs and technology has accelerated global integration and the export of American cultural values. English has dominated as the global language, with a global culture of entertainment, fashion and design emerging.

Security

1. A financing or investment instrument issued by a company or government agency that denotes an ownership interest and provides evidence of a debt, a right to share in the earnings of the issuer, or a right in the distribution of a property. 2. An asset pledged to guaranty the repayment of a loan, satisfaction of an obligation, or in compliance with an agreement.

Securitization

The process of converting an asset or pool of assets (or debt) into marketable securities in order to sell them to investors. The value and cash flows of the new security (financial instrument) are based on the underlying value and cash flows of the assets. Companies will securitize illiquid assets in order to increase their overall liquidity and generate immediate proceeds from their assets.

Dividend

A distribution of a portion of a company’s profits to the shareholders, payable in cash, stock or other property. Profits that are not distributed remain with the company as retained earnings. Start-ups and high-growth companies rarely offer dividends because their profits are reinvested to help sustain higher-than-average growth and expansion. Larger, established companies tend to issue regular dividends to maximize shareholder returns in ways aside from capital growth.

Equity

1. The state or quality of being just and fair. 2. Ownership interest in a corporation, property, or another asset, usually calculated as the value of the holding after subtracting any debt or liabilities. 3. Shares of stock. 4. The value of a brand’s reputation. 5. Representing an ownership interest: an equity stake. 6. Subordinated to all other claims on income, earnings, or assets.

Capitalize

1. To take advantage of. 2. To use as or convert into capital. 3. To supply with capital or investment funds. 4. To authorize the issue of a certain amount of stock. 5. To convert debt into equity. 6. To calculate the current value of future cash flows. 7. To include expenditures in business accounts as assets instead of expenses.

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