????"I used to think if there was reincarnation, I wanted to come back as the President or the Pope or a .400 baseball hitter. But now I want to come back as the bond market. You can intimidate everyone." --James Carville
????The news out of Europe just goes from bad to worse. With debt levels so high and confidence in government so low, the bond market has come a knocking and is intimidating the heck out of European governments. Interest rates on sovereign debt soar (see chart below) when the trust in the sanctity of that debt, and the country's ability to tighten their belt while growing out of it, plummet.
????What does all of this mean for entrepreneurs, other than a queasy feeling in your stomach when you read glance at The Wall Street Journal? I have three pieces of advice:
????1. Plan for Anything. My father used to always tell me, "don't assume anything." The range of possible macroeconomic scenarios has exploded in the last few months. We are entering a time of such uncertainty that one needs to be prepared for a far broader range of scenarios than ever before. Will the economy muddle through? Will we avoid a double dip? Are we entering a massive, 5-year EndGame of de-leveraging and no growth? Will high tech entrepreneurs be unaffected when they play in such massive secular growth areas, such as cloud, e-commerce, online advertising, mobile and others?
????No one knows, so develop a range of plans for 2012 with objective external triggers that would steer you towards one plan or the other – see The Art of the Long View for a guide on how to do this – and have them on the shelf ready to execute when the time is right.
????2. You Can't Fund a Big Debt Forever. Startups don't typically take on financial debt (and certainly not at the level of a sovereign government), but there are many other kinds of debt in a startup in particular and in life in general that one can find oneself in the midst of. For example:
