Vectra Bank's forecast counters local good vibe

I walked into Vectra Bank Colorado's economic forecast breakfast Wednesday and quickly ran into the always optimistic Tim Jackson. President/CEO of the Colorado Automobile Dealers Association, Jackson bubbled about a 13.7 percent sales increase for his industry in November, and said he hoped that Colorado dealers would finish the year posting a full 14 percent gain for 2011.

Jackson then introduced me to Andy Rogers, general manager of the Ritz-Carlton Denver, who said December was the best month of the year for the downtown luxury hotel, and he agreed with Jackson's ebullience over how Colorado's economy seemed to be picking up.

Then I sat down to listen to Vectra's speakers for the day:

• Patty Silverstein, who delivered the Denver Metro Chamber of Commerce's and Metro Denver Economic Development Corp.'s 2012 economic forecast;
• Mark Snead, vice president and economist at the Denver Branch of the Federal Reserve Bank of Kansas City; and,
• George Feiger, CEO of an investment firm in San Francisco, a past member of the Vectra Bank board of directors, and a frequent commentator on Bloomberg News, Fox Business News and in the Wall Street Journal.

Man, what a downer!

Silverstein told the crowd in the Seawall Ballroom at the Denver Center for Performing Arts that 2012 was a time for Colorado and metro Denver to "rebuild," but that the rebuilding will be "slow" because consumers are still being frugal; jobs will grow only about 1.1 percent both nationally and locally, leaving 123,000 people in metro Denver still looking desperately for work; "wages have been growing relatively slowly" in the region; and home prices may get boosted 3 percent at most during the year.

Snead, of the Denver office of the Fed, told the 400 business people: "It could be worse, it could be a lot worse. You could be in Greece."

And then he pointed out that Greece and the United States "have just about the same amount of debt."

The U.S., of course, is better equipped to handle that debt, Snead said. It is much bigger, and most of its population isn't drinking ouzo out on the beach. But still the comparison can be made; and, in general, Snead kept repeating, the U.S. and world economies during 2012 will mostly be "bottoming, not accelerating."

And then, with coffee in the room growing cold, Feiger took the lectern and told everybody the euro zone would definitely fail before it got better; China is actually in worse shape than its Communist leaders will ever let on; at least the U.S. is "the least bad place to be" in the world today; and nothing about what he was telling all the business leaders, who are generally paid to be optimistic about the outlooks for their firms, was funny.

"It's very far from funny," Feiger added.

No one was laughing as everybody headed for the doors.

4 bankers ready to lend

Dana Bondy, senior vice president for business banking at Colorado State Bank and Trust, likes to make lists, and so he made one during a panel discussion Wednesday on small business access to capital. Not a "top" 10, and in no particular order, here is his list:

1. Communicate with your lenders, sharing both good and bad news about your business.
2. Get behind your results, to take credit for your successes, and accountability for your losses.
3. Ask a lot of questions of your banker or lender.
4. Listen to your lender's answers to those questions. He or she provides an honest perspective on the risk and potential presented by your business proposition.
5. Expect great partners in your lenders. Expect them to return your calls, and be quick to return theirs.
6. Get specific when asking for money.
7. Work with the decision-maker on your loan.
8. Connect to business-finance resources like SCORE, a group of retired execs who do business counseling, or SBA or your local Small Business Development Center, all of which give free advice.
9. Connect with your peers. Many small business owners have already experienced the problems you may be facing in operating your business. Learn from their experience.
10. Shop your loan request around until you find the lender who wants to loan you money; any banker's advice about your business proposal, even if he or she turns down the loan, is valuable to you as a business operator.

Bondy was one of four bankers who spoke at a forum on access to capital hosted Wednesday by U.S. Rep. Diana DeGette. Bondy was joined on the panel by Mark Abell, of Vectra Bank Colorado; Mary Rogers; of JPMorgan Chase, who said she was the national spokeswoman for Chase on small business; Alan Ramirez, senior commerical loan officer at the Colorado Enterprise Fund; and Greg Lopez, Colorado district director of the Small Business Administration.

The bankers' collectively suggested a willingness to lend to business owners who did their homework and presented viable proposals, but they also admitted their institutions might be among the nine of ten who rejects a loan proposal before one institution accepts it from a specific business owner.

That was the point of Bondy's 10th item on his list. Just because a banker doesn't review your loan proposal favorably doesn't mean he or she can't teach you something about the proposal while reviewing it. Take all the advice you can get and move on to the next banker.

Access to capital is a traditional complaint of small business owners, and Rogers from Morgan Chase admitted credit got very tight during the financial crisis of 2008-2009.

But she said her bank's loan window didn't close altogether; it lent $8 billion in business loans during 2009 and has been increasing that number by multiples of billions ever since, looking forward to another increase in 2012.

Abell of Vectra Bank said Vectra didn't change their lending policies throughout the crisis years, and he gave examples of borrowers who backed up their proposals with good information and obtained loans even during the hard times. Ramirez explained the Colorado Enterprise Fund's goal is to lend to companies that cannot obtain capital elsewhere. He said the fund loaned $3.1 million in 2011, averaging $30,000 a loan.

SBA district director Greg Lopez said it was a moral obligation for the people on the panels to help small businesses succeed. He said SBA in Colorado guaranteed 1,425 loans with a value of $619 million last year.

He also said SBA is about to roll out a program that will partially guarantee loans based on contracts the borrower holds with customers. Contracts, or the promise of future revenue, traditionally have not been considered collateral, preventing many firms from obtaining the capital they need.

Denver chamber to the leg: 'We're coming in as strong as ever'

Kelly Brough, president and CEO of the Denver Metro Chamber of Commerce, told lawmakers and business friends Monday the chamber expects to exert its influence on big issues at the state Capitol this year, but always with small business in mind.

"We're coming in as strong as ever," Brough told legislative leaders and others gathered in the Old Supreme Court Chambers to hear the chamber's legislative agenda for 2012.

She then spelled out the biggest business issues facing lawmakers: refunding the unemployment insurance trust fund, and deciding on the future of the state's successful workers' compensation system.

And in the realms of what the chamber considers the three "pillars" of an economically viable state government -- health care, transportation and education -- Brough made it clear the state's largest business organization will continue to support a state health-insurance exchange, the funding of FasTracks, the metrowide light-rail public transportation system, and new methods of financing public schools and higher education.

"Our economy depends on their (students') ability to graduate from high school," she said.

Those are big issues that require public funding -- tax money -- which is always a sensitive issue for small business owners.

But Brough kept pointing out that Colorado is a state with a business community that is 90 percent small business, companies with 100 or fewer employees, including many, many one-man or one-woman shops. She suggested any solutions to the state's economic problems must be crafted with that small business community top of mind.

Yet strangely, the only issue that was raised during the presentation that generated a mild debate was over a bill State Sen. Betty Boyd said would be introduced to give Colorado businesses and employers preference when it came to state purchasing contracts.

A questioner in the audience asked if Boyd had considered the downside of such legislation, and House Speaker Frank McNulty piped in, "The concern is a real concern."

McNulty said if the Senate, where Democrats hold a majority, passed such a bill it would get close scrutiny in the House, where Republicans hold a one-vote advantage. McNulty said such bills often create "hurdles" for business people who operate best with the least government interference.

The new legislative session starts Wednesday.

Microgrids grow energy independence

Being energy independent by becoming your own distributor of electricity is an idea spreading among college campus administrators and the military -- to the point that soldiers in Afghanistan are already creating their own battlefield microgrids, according to an expert who predicts a 164 percent growth in generation capacity for campus microgrids over the next six years.

Yet the U.S. commercial/industrial sector, which includes large and small businesses that could benefit from generating and distributing their own power, is the least active of five industry groups in the developing market for microgrids, which Peter Asmus, a San Francisco-based analyst for Boulder's Pike Research, estimates will reach $777 million by 2017 for campus microgrids alone.

Commerical/industrial, especially small business, is "lagging a little bit" compared with other sectors' investigations of the benefits of microgrids and distributed power generation, Asmus said. "They're waiting for these [methods] to be validated," he said.

I wrote about Pike Research on this blog a little more than a year ago, and find its spotlight on cleantech markets a fascinating look into the future of American business. It also suggests promising markets for small businesses hoping to become vendors and suppliers to the bigger players in cleantech industries. Or to become bigger players themselves.

Asmus said distributed energy -- the local generation of power to serve onsite users, a long standing practice of college campuses using diesel fuel to generate power and now renewable sources like wind and solar -- is still "a small piece of the energy portfolio," but microgrids for distribution of such energy are increasingly considered adjunct enterprises to protect institutions from blackouts and sometimes to sell energy to create revenue.

"In the U.S.," Asmus said, "utilities will pay people to go off their systems" during peak periods in order to preserve capacity for their own customers.

Military bases in the U.S. are especially sensitive to power outages and are seeking to create their own microgrids to avoid dependence on a supplier subject to shortages. Asmus said soldiers in Afghanistan are already using "mobile" grids they can set up out of backpacks in the field.

Asmus' report suggests five groups of power users investigating greater use of microgrids: campus users (which includes business parks, college campuses, and large-company campuses); the military; remote users (mostly in developing countries that lack nationwide power grids for distribution); community/utilities (which are popular in Europe, especially in countries like Denmark which draws 25 percent of its total energy from wind); and finally commerical/industrial in the United States. He said some utilities in the U.S. are beginning to see the wisdom of creating microgrids for servicing customers off the national power grid.

Creating a microgrid is "relatively easy" when there is a single owner involved. Multiple owners of a grid, such as the many firms located in a business park, are more difficult to service and regulate.

By 2017, Asmus estimates installed generation capacity for microgrids will increase 164 percent from 620 megawatts to 1.6 gigawatts, with most of that coming from the campus sector worldwide.

Voters can save America

It's not often that news, analysis and even your friends' opinions converge to make clear what's been happening to make the American voter so damned mad!

Here's Floyd Norris from the New York Times on Sunday:

"In the eight decades before the recent recession, there was never a period when as much as 9 percent of U.S. gross domestic product went to companies in the form of after-tax profits. Now the figure is over 10 percent. During the same period, there never was a quarter when wage and salary income amounted to less than 45 percent of the economy. Now the figure is below 44 percent."

Here's Benjamin Wallace-Wells in a New York magazine profile of Mitt Romney's record as an executive at Bain Capital, a company he helped create:

"Romney was also a business revolutionary. Our economy went through a remarkable shift during the eighties as Wall Street reclaimed control of American business and sought to remake it in its own image. Romney developed one of the tools that made this possible, pioneering the use of takeovers to change the way a business functioned, remaking it in the name of efficiency."

And here is Tim Correll, a lawyer friend of mine who has a sharp eye for what is happening as the sand washes out from under the feet of middle class America:

"I've had it with these class villains who argue that the one percent are 'job creators' who won't create jobs if they get a tax increase. For starters, lets note that entrepreneurs don't create jobs, consumers create jobs. Our greatest job growth over an extended priod of time took place from 1950 to 1980. During that time the top marginal tax rate was ninety, yes, that's right, NINETY, percent -- 90%, but we had soldiers coming home, unemployed men who were skilled in the scutty blue-collar skills of war, but we funded the GI bill (with those taxes on the one percent) and those GIs went to school and bought houses and spent money and the economy grew and grew and grew. (I'm 67 years old and through all my growing up years I never saw a year where my father -- a university professor -- didn't get a raise.) and things just kept getting better. We built the interstate highway system, creating huge winners in the petroleum and automobile industry, cars went from $500 to $3,000, and gas went from $0.15 a gallon to $0.85 a gallon, and families went from riding buses to buying homes with two cars in the garage. That's what it was like when we built a nation where the cost was shared based upon everyone's ability to pay. Tax those constipated assholes that have no patriotism, no loyalty and think of no one but themselves, and -- you know what -- we'll be the better country we used to be, and they'll still make money."

I find it "amusing," as my friend Ken Bugosh would say, watching media types like Charlie Rose trying to make sense of the Occupy Wall Street movement when the destruction of the middle class has been a two-decade process that was hardly invisible. "News to me!" the mainstream media is saying now, which is as much a symptom of that industry's decline as is the fact I now read the Denver Post online.

News becomes news nowadays only when New York, and, yes, Wall Street, finally notices. But it takes good journalists like Norris to document the little recognized, big-picture facts that accumulate along the way of a nation's decline. And by documenting them, make possible the opportunity for the nation to react to such statistics.

It takes American politicians, however, much too long to read the tea leaves and actually enact legislation to change the things that are happening to us. And yet, if only the political elite would wake up to voters' needs, even our current Congress and state legislature in Colorado still have time to make important changes that will shape our future.

The Romney profile was the first piece of journalism I have seen that actually showed why and how he became a wealthy businessman, a credit he now claims qualifies him to become the next president. But the story shows, too, just how souless Romney's policy making becomes because he values the American investor over the American worker.

Yesterday, I asked a Hispanic receptionist at a business I was visiting whether she would vote for Obama, and she quickly shook her head: no, no, no. I left saying, Well, don't forget who you will be voting for then!

If Mitt Romney is the Republican nominee opposing Obama's re-election, then perhaps the stark difference between a president who cares for all the American people and a candidate whose life has demonstrated his disregard for common people and overwrought concern for the wealthy will be prominently illustrated by the television campaign ads sure to accompany the 2012 election campaign.

Let's hope so. Because news and analysis and even the opinions of friends converge to provide a stark illustration of what truly is happening in America today. The nation's common-man soul is being crushed by the success of wealth in these United States.

Only the American voter can reverse that tragic trend.

In the Chemo Room: Out with a tumor

I'm sitting at my computer on the day after a thoracic surgeon, John D. Mitchell, took out a relatively large colorectal tumor from my trachea, and I've been left wondering if all the muscle soreness in my body (as if at age 64 and totally out of shape I had just played in a two-hour pick-up, touch football game) is the result of not taking the heavy pain killers they usually give you after a major surgery?

Is that the pain they are trying to kill? Is it pain that results from full-body anesthesia? No matter where the surgery?

Because that's most of the pain I am feeling today on the day after. A mild sore throat, and little chest pain, but they pulled the tumor (literally) from the wall of the trachea and kept me overnight at the University of Colorado Cancer Center to make sure they didn't also pull out a hole in the trachea wall, which would have caused me further problems.

They did the work with a bronchoscope and had they accidentally pulled open a hole in the wall of the tube from my throat to my lungs, they would have had to split open my chest to go in and repair it. That's why I am home today; they did not open a hole, and I was released this morning as my over-all-aching increased by the minute.

But this has been the latest chapter in my fight from the Chemo Room against this four-and-a-half- year-old case of colorectal cancer.

The tumor grew in my throat while I was enrolled in a clinical trial testing a drug that had mild-to- moderate side effects and held most of the rest of the many tumors in my lungs and chest in check during the test. But then I started coughing badly, they ran a CT scan and looked closely, and ordered up the bronchoscopy.

So now I've been dropped from the trial because it was clear the drug I was receiving and have written about here before wasn't doing as good a job as we were thinking it was doing. But the trachea is a strange place for colorectal cancer to matastisize, so you can probably blame my individual cancer for the unexpected response to the drug.

The good thing is they found the tumor before it stopped my breathing altogether; they learned a little something about the drug; I'm breathing better now and no longer coughing as much. The bad thing is the tumor could grow back from the place where it was taken from, and the rest of the cancer mets (metastases) remain in my lungs and chest cavity (lymph nodes) and must be dealt with.

So you could call this chapter of In the Chemo Room, 'In, Out and Back Into the Chemo Room' because that's where I'm destined to return. As soon as all these aches and pains go away and my body heals from the surgery.

Dr. Wells Messersmith, my oncologist now, said he'd find a new way to treat me, which probably will involve a new clinical trial. But that's what the Cancer Center has come to be known for nationally in a very short time.

And that's why Mitchell, one of the nation's best thoracic surgeons I am told, is working there on patients like me. You can't say I'm not getting the best of care. And so are hundreds and hundreds of others who are passing through the center's gates.

Precision toolmaker wants to keep hiring

Patrick Stacy has hired five new employees, including an engineer, in the last three months. "I'm a toolmaker," he said. "My mentor used to say a toolmaker's job is never done."

Stacy Machine & Tooling in Broomfield has grown over 30 years from a  a one-man shop in Boulder to a $2 million, computer-aided-design and computer-aided-manufacturing shop with 21 employees and an owner who wants to make it bigger.

Stacy is one of those small-business owners defended by Republicans who argue against any increase in taxes by saying it will keep small businesses from hiring new people.

And yet Pat Stacy, who reached the ranks of the wealthy business owner only in 2011, his best year ever, still plans to expand and grow if only banks will help him finance the growth.

He says he has plenty of demand. "Global warming's been very good" to the instrument manufacturers that supply the research industries around Boulder, Stacy says. "Demand is coming from funding through the government," he added. "NASA contracts, Department of Energy contracts, Department of Defense contracts, all of these special research projects that are going on for the green stuff. We don't see a lot of green or solar; but we're just starting to see some of that."

Testimony, I guess, to the effectiveness of the stimulus spending that has been denigrated for three years of the Obama administration.

But Stacy's very success meeting that demand has now put him on President Obama's "hit list," he said. His income and profits this year will push through the $250,000 level that has long been considered a break point for increasing taxes on the wealthy.

"I'm finally getting to be where the politicians start taking aim," he said. But he said that's a problem 30 years in the making, and one most small business owners would welcome as a mark of achievement. It forces them to make decisions, however.

Most business owners struggle all their lives to get to a point where their business generates a little personal wealth -- "the time you're almost successful and actually get to be a player," Stacy said -- but then the "compromises" every business owner makes get a little more complicated.

Do you take a tax break that gains you the $60,000 you might plow back into your business for a new employee or a new piece of equipment? Or do you take it as a bonus or a raise, and bump up your tax liability.

"Growing a business, you're always making compromises," Stacy said. And growing his business, even after 30 years, is still Pat Stacy's primary goal for Stacy Manufacturing. His current plant at 2810 Industrial Lane in Broomfield is leased to buy, and the property has plenty of ground for expansion.

But banks for the past three years have not been willing to lend small business the money they need to to expand, he says. "These banks are all paralyzed. They will not loan money."

"Until they can get the banks to let go and finance people like me and people like a lot of other people who are highly leveraged in their business ...," Stacy says his voice trailing off.

"I'm up to here in debt," he said, "I've always been up to here in debt." But his business and others "still survive" and he believes "the rules have to change a little bit" to allow a real recovery to gain any momentum.

Pat Stacy got his degree in political science so he watches the way political winds blow, and he's not afraid to express his opinions.

"I love history, politics and all the other things of the world," he said, and it would seem some of those wider interests keep firing the childhood mechanical curiosity that lured him into the precision tooling business he has created. Hear the poetry in this description of one machine's operations:

"This eight-thousanths diameter copper wire, it cuts this underwater, deionized water.... you program it, you make a little fixture, you put it up there and you watch that little wire go cut it underneath the water with a beautiful blue flame, a blue arc."

Or in this position on Wall Street financiers vs. small business owners:

"If you're a stock broker and you're making deals and never get out of your seat and you make a quarter million dollars or a million dollars, should that be taxed a little different than maybe the money I make as a manufacturer, or as a farmer would make, or another kind of small business guy?"

Or: "Now you can put motives into the banking industry, whatever your want. You can put motives of: 'Hey, they're not lending money because they want to see Obama fail ... ' (but) the bottom line is the banks have money, somebody has money, and they're not lending it unless you're so rich you've got money coming out of your pockets."

There is a table in the front lobby of Pat Stacy's manufacturing plant; it's crowded with stainless steel and titanium parts he says he and his employees have made that now fly in space or rest in the joints of people who have had body parts replaced. On a wall nearby is his company's ISO certification, and you can tell Pat Stacy is pretty proud of the business he has made.

You can tell, too, that if he gets some financing he's going to make Stacy Manufacturing bigger by filling out his current second shift or by buying some newer machine to replace some of the "ancient" 1991 models his workers now use.

You can tell that because, even if he has made the politicians' "hit list" and his hard-earned "wealth" remains always at risk, Stacy believes what his mentor taught him long ago:

"A toolmaker's work is never done."