Is it that bad?

Many people outside the US have been asking me: Is the US economy really that bad? What does that mean for early stage companies?

From outside the US, the sensationalist, and not so sensationalist, media reports have relentlessly painted a grim picture of the US economy.  While commentators have been calling a recession for a long time, official stats have not yet reported the requisite two quarters of contraction. Although the Fed Chairman did warn of a possible "R" today.

The optimists are saying that the the damage is contained to finance and real estate, while growth in the rest of the world will soften the blow. Pessimists say the flow through to consumer spending will drag down the whole economy.

What is the impact on early stage companies? My reading of the mood is that, unless you are looking for a IPO or trying to raise debt, then stay on course but be disciplined. VentureBeat has a post that pulls together a variety of sources here.

Bottom Line: Glass half-full? Glass half-empty?

Comments

[Paul]

The day after this posting the floodgates opened on the probability of recession. The basic advice remains the same.