August 23, 2005
by Bob Meyer, Editor of BarterNews
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Countertrade Opportunity — Corporate Bearer Bonds
If you trade with Brazil, or know of any company who does, and you have an obligation to pay to the Brazilian government contact Bob Meyer (e-mail: email@example.com).
He can introduce you to an entity that has $11,791,582 in face value Brazilian Corporate Bearer Bonds issued by Petrobas. These bonds are available at a cash discount, and the Brazilian government will accept them as payment at face value for obligations.
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Bartercard’s Sharpe Asserts Online Barter Has Staggering Potential
As the largest “open membership” trade exchange, with some 70,000 members worldwide, Bartercard has pioneered online trading through its extensive worldwide organization for years. CEO Wayne Sharpe contends that “we have only scratched the surface of what is possible!”
This year, the company will complete $40 million in online trade transactions, up from $4.4 million in 2001. Bartercard’s portal is unique in that it not only completes a member’s trade, but also facilitates the transaction of funds.
The company says their online trading success was made possible through the two tiers of extensive internal product development and the business development team of Gravitymax, a Sydney-based web development firm.
Bartercard enjoyed a ten-fold increase in inquiries from its web sites since Gravitymax reworked Bartercard’s web site structure and design. For more information go to www.bartercard.com.
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“We have significant momentum on our side, and will continue to aggressively take market share from our competitors...while increasing the size of the overall marketplace.”
—Steven White, CEO ITEX
The ITEX Corporation (OTCBB:ITEX) announced it has deposited over $1 million in fees for the first time in the company’s history within a one-month period. CEO Steven White exclaimed, “To our knowledge, no company in our industry in the U.S. has ever deposited $1,000,000 generated from transaction and association fees in any month...we did so in the first 19 days of August.”
White revealed that his goal is to shorten the time period (of generating a million) to a weekly and then a per day event!
ITEX statistics for the first 19 days of August, 2005:
• Cash deposits of $1,009,542
• Transaction volume of $10,160,000
• 22,000 member businesses (revised up from 21,000)
• 17,416 completed transactions
• 1,242 new online listings
• 146 new business registrations
ITEX Franchisee John Castoro Acquires BXI New York
CEO Steven White emphasized that franchisees with ITEX can build a substantial business. “John Castoro of New Jersey just completed the purchase of the BXI office in New York and has created an enterprise of 1,000 members, doing $20 million annually in transaction volume which generates almost $1 million in cash revenue a year.” That number, White noted, “creates one of the largest exchanges in the country on an individual basis. Much larger than most of the independent exchanges in the United States.”
White also pointed out that independent licensed broker Michael Muzzin, owner of an existing ITEX office in Toronto since 2000, purchased the Toronto office previously owned by John Castoro. Muzzin’s expanded office with 650 members will generate $500,000 in cash revenue and $8 million in transaction volume yearly.
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International Monetary Systems Reports Quarterly Revenue, Net Income Increases
Publicly-traded IMS (OTCBB:INLM), the holding company for the Continental Trade Exchange barter network, reported that its second quarter, ending June 30, saw gross revenue increasing 44% to $1,597,891, compared to $1,110,410 for the second quarter of 2004. Net income was $274,341, representing an 89% jump from the $144,819 generated during the same three months of 2004.
The 2005 second-quarter net income was $113,307, an increase of 180% compared to the $40,512 net income for the same period in 2004.
As of June 30, IMS total assets reached $6,913,341 from $4,870,360 at the end of 2004, with stockholders’ equity of $3,942,941 up from $2,976,382.
IMS Acquisition Figures Reported
As reported earlier this year, IMS purchased both Eagle Barter Exchange of Chattanooga and United Trade Network of Reno in April, and Barter Business Unlimited in May.
The purchase price of the Chattanooga office was $365,000, including $65,000 down payment in cash and backed up by 600,000 shares of common stock guaranteed to have a value of at least $300,000 or $0.50 per share. (The membership list was valued at $330,000, which according to IMS is the real value in acquisitions.)
The purchase price of the Reno office’s selected assets was $155,000, backed by the issuance of 110,000 shares of stock with a guaranteed value of $0.50 per share. (The membership list was valued at $130,000.)
IMS purchased Barter Business Unlimited for a discounted price of $1,550,000. Payment was $500,000 cash and 2,050,000 stock shares, with 1,400,000 shares having a guaranteed value of $0.50 per share, plus a promissory note for $350,000. (The membership list in this acquisition was valued at $1,376,500.)
Every barter company in the world is listed on our web site, click through to our Global List of Barter Companies.
Today’s Real Estate Boom Built On 1997 Taxpayer Relief Act
Economists in increasing numbers are citing an unappreciated force that may have infected a strong housing market with home-buying mania. They say it’s bad tax policy—the Taxpayer Relief Act of 1997, signed by President Clinton.
According to Mark Zandi, chief economist at economic-consulting firm Economy.com, the tax law change created much of the economic incentive to buy, flip, and buy again every two years. (A family can exempt the first $500,000 in profit on the sale of the home from capital-gains taxes, for a single filer it’s $250,000.) The lure of tax-free profit has been a powerful incentive as it’s the kind of math everyone can figure out.
But experts say we’re overinvesting in housing as a nation. “Residential investment accounted for 35% of private investment in the past year, a level not seen since the early 1970s,” reflects Martin Barnes, the perceptive financial-market observer at Bank Credit Analyst.
What’s ahead for the most politically successful segment in society (homeowners, builders and realtors)? William Ahearn of the Washington, DC-based Tax Foundation, says the home-mortgage deduction is sacrosanct on Capital Hill, but the capital-gains law is different. It’s only eight years old and action ought to be taken before this bit of policy becomes as enmeshed as the tax break for mortgage interest.
Editor’s note: The foregoing information was condensed from an article titled, “A Housing Boom Built On Folly,” in the July issue of MortgagePro News.
Indian Superstars To Influence American Business
The Conference Board’s prestigious magazine, Across the Board, has published an article titled “The Indians Are Coming” in which it sees Indian business gurus changing the face of American enterprise.
The authors of the article are Stuart Crainer and Des Dearlove, founders of Suntop Media and recently launched London Business Press. They are the creators of the first ranking of business gurus, the Thinkers 50 ( www.thinkers50.com).
A new up-and-coming generation of Indian business thinkers are ready to join a pantheon of superstars that includes C.K. Prahalad, Ram Charan, Nobel Prize economist Amarty a Sen, Vijay Govindarajan, and Sumantra Ghoshal.
A growing number of noted academics at leading U.S. business schools have Indian roots, says the article. This group includes Rakesh Khurana, Nitin Nohria and Krishna Palepu of the Harvard Business School; Jagdish Bhagwati at Columbia; Deepak Jain and Mohanbir Sawhney at Northwestern’s Kellogg School, and Raj Reddy at Carnegie Mellon.
Rising numbers of Indians are enrolled in leading MBA programs around the world. For the first time this year, they will comprise the largest national contingent at INSEAD, a major business school with campuses in Europe, Asia, and the United States. At IMD, the Swiss-based business school, the number of Indian MBA students has more than doubled since 2001, and at ESADE in Barcelona, Indian enrollment has quadrupled in the last four years.
The authors note that prominent business journalists have Indian backgrounds, including The Wall Street Journal editorial features editor Tunku Varadarajan, Parminder Bahra from The Times of London, and many others. “Among the people who influence business thinking, there is an increasingly Indian presence.”
While nobody can predict the long-term influence on American business, it is clearly expanding. One major reason may be the ability of Indian business thinkers to see business in a truly global sense. And, the authors point out, they do not automatically regard the United States as the center of the commercial universe.
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Wealthiest Generation Xers Losing Interest In Real Estate
An online survey completed by MainStay Investments shows that some of the richest Gen Xers—people who fall between the ages of 26 and 40—have lost interest in buying real estate in the past year.
According to the survey, in 2005 just 13% of Gen Xers plan to invest money in real estate, compared with 32% the year earlier.
Beverly Moore, a managing director at MainStay, who was involved in the survey says, “Their interest in real estate has decreased. While their interest in cash and equities has increased.”
Researchers point out that this slice of society is far wiser about its investment strategies than people realize. The average household income of the surveyed Gen Xers was $211,600, and their total net worth averaged $735,300. Also, 90% of the surveyed Gen Xers identified themselves as homeowners.
Here & There...
A survey commissioned by the American Bankers Association shows that 31% of consumers prefer using debit cards for day-to-day purchases, while 37% would rather use cash. Credit cards are favored by 18%, and 14% like writing checks.
Last week we reported on hotel inventory tightening due to hotel rooms being converted to condominiums. According to Smith Travel Research, a hotel-research firm based in Hendersonville (TN), the hotel industry is bringing about the rise of the “condotel,” a hybrid of a hotel and condo where people buy what are effectively hotel rooms. Their research shows 227 projects under way nationwide, representing 93,425 units with a little more than 24,000 of those hotel rooms.
Follow-up on last week’s article regarding the real estate profession. Re/Max, the nation’s second-largest real estate brokerage, is planning to pool all U.S. residential property listings on its web site...a move that would create a formidable national competitor to industry-backed Realtor.com.
The move could eventually help reduce consumers’ cost of buying and selling homes, which would be a definite asset as competition with other web-based brokerages heats up.
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Is eBay the way to market one’s goods? Getting viewers on the world’s busiest web auction site is increasingly difficult as eBay listed over a billion items for sale last year.
The eight-year ban on direct sales in China is ending, with new rules clarifying the legal gray area in which companies now operate. But the coming rules also are expected to include limits that both could keep out smaller domestic companies and hinder larger participants, underlining Beijing’s continuing concerns about person-to-person sales.
The average American spends more than $5,500 a year using credit cards. The equivalent figure for Germany is only $64, and for France just $30, according to Euromonitor International, a market-research company.
The Federal Reserve reports that U.S. consumers hold nearly $11 trillion in debt, up from $6.8 trillion in 1999.
Sears Holding Corp. is using its scrip ($10 or $15 coupons) to settle a class action lawsuit involving 2.3 million people whose accounts were closed and sold to collection agencies.
If you’ve missed any of our weekly Tuesday Reports the past five years we have an archive of issues for you at the bottom of this letter...check it out!