[caption id="attachment_26711" align="alignleft" width="108" caption="Clay Stephens"][/caption]

If you are ready to take advantage of growth opportunities, there are valuable reasons to make a move now:

Major tax breaks (100 percent expensing, bonus depreciation plus first year write-offs)

Great time to get bargains from vendors/equipment dealers

Opportunities to move ahead of competitors or move into new markets while others hold back and are uncertain

There is capital available for companies that have shown cash flow in recent years and taken steps to improve liquidity and reduce leverage.

Rates are at historic lows.

Incentives to do it now

If you see opportunities and growth, there are compelling reasons to start the process now.  Particularly if new capital equipment can:

Reduce costs

Increase sales

Help enter new markets

Increase productivity

Not to mention you get to write-off the costs and deduct interest while borrowing at historically low interest rates.

Major companies are reporting near record profits from aggressive re-tooling and improving productivity.  It is good time for small/medium-sized companies to evaluate their opportunities to grow and upgrade as well.

Here are some reasons now to look for opportunities to grow your business and some predictors of growth and economic rebound:

• U.S. machine tool consumption is up 62 percent to date in 2010.

• Intel reported profits up 59 percent and sales up 18 percent and announced plans to invest $6 billion-plus in new facilities in Oregon and Arizona, creating thousands of construction and permanent jobs.

• Heavy duty truck production is strong in 2010.

Meanwhile, U.S. News reported four signs the job market is finally improving:

• Record layoffs of ’08 and ’09 seem to be over.

• Major sectors like manufacturing, transportation, retail are hiring.

• Workers with specialized skills are hard to find.

• Private sectors are adding jobs.  Private sector hiring has increased every month this year, a gradual but positive trend.  Net job losses are due to lay-offs in the government sector.

Here are some more factors to consider:

• For all U.S. companies, the Commerce Department estimates profits are up 26 percent from a year earlier.  The data indicates that big companies are recovering faster and more strongly than the overall economy.

• There is a lot of liquidity in the system and on the sidelines – the key is putting it back to work.

• Wine Symposium Survey in September reported increased optimism from wine executives about sales growth and profitability increasing.

• Dr. Christopher Thornberg of Beacon Economics told the Sonoma County Economic Development Board that he sees little risk of a double dip recession and that things are moving in the right direction, but we are in a long, slow recovery.

• On Oct. 18, Apple announced fourth-quarter income up 70 percent, and IBM reported increased income and raised guidance for full year 2010.•Local manufacturers and technology companies are showing an upward trend in orders.

• Business spending nationally for durable goods increased in August for the third time in four months.

•The Fed is ready to take further steps to boost the economy, if needed.

•Government is getting the message (hopefully) that we need to make the U.S. economy competitive again and provide incentives to invest and create jobs.

The key elements to keep in mind are:

•Belief in the future

•ositive opportunities

•Incentives to do it now

The key message is that America is coming back and is still a great place to build a business.  The recovery is slowly but surely under way.  We are climbing out of a major hole.  Last year was the first year since the Great Depression in which the economic output of the entire world declined. A great deal of recovery is needed. The rebuilding process will get a boost from new spending to replace old equipment and structures. It can’t be postponed indefinitely. The benefits from new capital equipment will be to increase productivity, reduce operational costs and create new growth.

With cheap borrowing rates, tax write-offs, great equipment prices and a recovering market, we see continued improvements in 2011 and excellent opportunities to take advantage of.


Clay Stephens is the founder and CEO of Warren Capital Corp., a specialty finance company, headquartered in Novato.  Warren Capital is 26 years old and has completed more than 3,000 transactions for a value in excess of $1.5 billion.  It offers a variety of equipment finance, asset-based financing products and corporate advisory/consulting services. Before founding Warren Capital, Clay was also vice president, treasurer and division president of a Fortune 500 company, Wheelabrator Frye Inc. His last position at Wheelabrator Frye was that of president and CEO of Trailmobile Finance Co., a national commercial finance firm.  Previously he was a director and audit committee chairman of Fisher Scientific International Inc.