F I NANCIAL CRISIS WATCH: Find i n g t h e B o t to m o f t h e Ec o n o m i c D ow n t u r n

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Green Biz

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Keep Umbrellas Handy and
5 South Bay Organizations Make Hay When the Sun Shines

Upping the Eco Ante Legal Pro Doubleheader:

Survive a Lawsuit and
Select the Right “Entity” for Your Business

Technology Insider Doubleheader:

Digital Publishing Makes Magazines Greener and
Surviving the Recession With Efficient IT Planning

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 SUBPRIME FALLOUT - CREDIT CRUNCH - MORTGAGE MELTDOWN! A Truly Holistic View
of “Sustainability”
Humanity faces dire consequences when
The Rules Have Changed! we destroy the sustainability of our eco-
Debt Structuring, Credit Management system. In this “Green Biz” issue, we pro-
And Tax Planning file five local organizations committed to
doing business in an ecologically sustain-
Crucial in Real Estate Financing able manner while teaching others to do

T housands of homeowners are learning the hard

way how short-sighted mortgage opportunities can
devastate their financial situation. In the current volatile
the same. “Sustainability” is a word that
has been horribly ignored by our civili-
mortgage market, a mortgage is no longer just a mort-
zation for much too long. We live in the
gage. It is a financial instrument that needs to be woven “here and now” with little or no thought
into the fabric of your short and long term financial plans. for what led us here or what unsustain-
As a Certified Mortgage Planning Specialist and Certified Ken Roberts CMPS, CLA able living could mean for our future.
Liabilities Advisor, I take a financial planning approach to President
mortgage lending and debt management to effectively Certified Mortgage Planning Specialist
We do this in the way we exploit the
maximize tax advantage while structuring your financing Certified Liabilities Advisor environment and take our chronically
with safety and liquidity in mind. 30 Years in Real Estate flawed economic system for granted. It’s
In today’s real estate market environment, you can no longer afford to do business with anyone no accident that both are collapsing be-
who’s not a tried and true seasoned professional. Do not trust one of your life’s largest financial fore us. More green in the environment
transactions to someone that’s new, part-time or doing mortgages on the side. Likewise, make
is a good thing. More green in the form
sure you deal with a Realtor that is at the top of their game and experienced in how to thrive in our
current environment. For you, it may well be the difference between success and failure. The game of green ink on currency not sustained
has changed. Play to win!! by genuine production has proved a
very bad thing. The latter unsustainable
The Lowest Rate on the Wrong Program is Very Expensive! form of “green” is the root cause of the
wild swings the global economy has ex-
Call Now For a Free, No Obligation Consultation (310) 534-6200 perienced over the last generation. Busi-
AMERICAN RESIDENTIAL REAL ESTATE FINANCIAL, INC. ness Insider Magazine strives to help you
21250 Hawthorne Blvd. Ste 500, Torrance – www.kenrobertslending.com understand “sustainability” in all forms,
whether they be ecological or economic.
Many of our columnists share useful
GROWING A BUSINESS? insights on ways to run your business
more effectively so you are in a better
position to cultivate the dollars circu-
Your South Bay Business Lawyer™ lating in the market. This is something
Limit your obligations and liability: every business must continue to do at all
Set up a corporation, LLC or partnership for your times. It’s a given that we will be working
business. harder for the foreseeable future. How-
ever, the businesses that survive this un-
Protect your interests: precedented economic downturn will be
Get customized contracts to favor your position and the ones that work smarter—or better
a skilled advocate to negotiate on your behalf. yet—wiser. It also helps to gain a deeper
understanding of the economics that set
Play to win:
the stage for our activities. This is where
Increase your chances of coming out on top in a
Business Insider Magazine strives to go
business dispute.
deeper to expand your understanding of
Firm focus: issues and events affecting our economy
New and growing companies, non-profits and that continue to mystify the corporate-
woman-owned businesses. controlled media. It’s really not a mys-
tery at all if you simply open your eyes
Dedicated to providing affordable and take a closer look. Take a close look
at this issue and I expect your eyes will
and responsive one-on-one client service open considerably wider.
Call DeAnn today for a free consultation Regards,
1334 Parkview Avenue, #100 • Manhattan Beach, California 90266
tel: 310.546.8111 • fax: 310.546.8158 • e-mail: deann@dfclawcorp.com David Whitehead
www.southbaybusinesslawyers.com Publisher

DeeAnn Flores Chase - Ad Master 1 1 8/5/2008 4:00:15 PM

 Business Friendly, Green Gracious.

Covered Solar Paneled Parking Proposed “Dry Cooling” Power Plant

El Segundo is not only known as the first Most Business-Friendly City in Los Angeles County, but also one
of the most environmentally conscious cities in California. Our record speaks for itself:

#1 City in L.A. & Orange Counties: In diverting solid waste to recycled products

#1 City in California: In reclaimed water use

We’re also home to the Southland’s largest solar panel project, a new “dry cooling” power plant and
several upcoming developments expected to achieve LEED certification for environmental sustainability.
El Segundo also recently established its own Environmental Committee dedicated to ensuring that future
projects are green-conscious. So if you’re looking to relocate your company to a city that takes care of its
businesses and the planet, look no further than El Segundo.

www.themostbusinessfriendlycity.com THE CITY THAT INVESTS IN YOU.

I n This Iss u e. . .

Cover Story:

Green Biz
5 South Bay Organizations Upping the Eco Ante ... 8

Legal Pro Doubleheader:

Litigation Insider:
7 Steps to Surviving a Lawsuit ... 10

Incorporation Insider
Protect Yourself and Your Business By Selecting the Right “Entity” ... 20

A Real Estate Pro’s Perspective

The Real Estate Weather Report ... 12

Publisher’s Perspective
The Empire With the Invisible Throne ... 16

The Financial Crisis:

Finding The Bottom ... 18

Technology Insider:
Digital Publishing Makes Magazines Greener ... 6
Efficient IT Planning is Key to Recession Survival ... 7

South Bay Calendar of Business Events:

Save the Date! ... 22
 BUSINESS insider MAGAZINE
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TECHNOLOGY INSIDER
Digital Publishing Makes Magazines Greener!
By David Whitehead
B
ecause every publication I have ever been associated with
was produced with computers, I have spent my entire career
wondering if we would always be publishing with ink and
paper. Unlike most publishing professionals of my generation, I was
never bonded to the idea of chewing up pulp. Although I have no
timeframes in mind for going totally digital with Business Insider
Magazine, I could end up making this decision before I retire with
the last of the baby boomers. “We’ll do print as long as it makes
sense” is the mantra espoused by many in today’s publishing indus-
try. For many, it’s no longer about if but when digital will become
dominant over traditional print.
Five months prior to this writing, we began phasing out our online
.pdf edition of Business Insider Magazine in favor of the high-reso-
lution Adobe Flash digital format. So far, we
have cultivated additional online readers equal
to about 15 percent of our print distribution,
and this total continues to increase over time.
This impressed me because current platforms
for “flip-page” magazines require readers to
navigate and zoom through vertically designed
magazine pages on their horizontal computer
screens. Despite this and other limitations in
using conventional computers as portable read-
ing devices, a core segment of computer users
are choosing to read digital publications. In fact,
some publishers are producing horizontally de-
signed versions of their print publications for
easy viewing on conventional computer display
screens. And this is just the beginning.
Print Publishers Largely Divided on
the Impact of Digital Publishing
I recently participated in an online discussion with publishing
professionals from around the United States on their experiences
with digital publishing. The general consensus is digital will play a
significant role in our future, but how much impact it will have or if
it will at some point eliminate print is hotly debated.
First, even though significant reader gains have been made be-
cause these readers are coming from the World Wide Web it is dif-
ficult to qualify them to know if they are relevant to a particular
publication’s print display advertisers. In fact, the “paper defenders”
point out there is no collected data indicating print advertisers will
buy more because a publication is available online as a digital flip-
magazine. I personally take this observation with a grain of salt be-
cause print publishers made similar justifications for ignoring the
impact of the Internet. They were stunned when entire classes of
traditional display advertising migrated online and stayed there.
 S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e
Forward-thinking publishers understand the obvious potential for
this technology to catch on in a big way. There are also premium
publication platforms that do track the full range of reader statis-
tics. ZMags, a Boston-based company, asserts that publishers are
using their advanced platform to qualify readers, earn revenue and
know the cost/revenue ratios of the digital magazines in relation to
the numbers of online readers.
The Next Technology Wave Poised
to Rock Print Publishing
What’s further troubled traditional publishers already coping with
the worst crisis to hit our industry in decades is a new technology
that could make digital formats the dominant publication media in
the not-too-distant future.
A new gadget hit technology consumers with
a whisper while creating lively debate in the
print publishing community. It’s an e-book
reader called the Amazon Kindle. Marketed
by Amazon.com, this device at first glance
looks like a simple gizmo donning a small ver-
tical screen with a typing keypad below it and
a few simple navigation buttons on the sides.
I’ve seen flashier calculators, but like the un-
assuming iPod, this device packs tremendous
power that will undoubtedly have a transfor-
mative impact on print publishers.
What has drawn the ire of our industry pa-
per pushers is its screen technology. Rather
than using a traditional Liquid Crystal Dis-
play (LCD) screen, it uses a new electropho-
retic technology delivering print-sharp screen
resolution that does not require battery-consuming backlighting.
Conventional LCD screens are assembled mostly by hand through
an expensive bulk manufacturing process that must be conducted
in a sterile environment. In fact, the limitations of LCD technology
have somewhat stymied the evolution of personal computers and
other electronic devices. At least it has until now.
The newer generation screen displays will roll off the production
lines with a process similar to printing. They will be much cheaper
to produce, lighter, can run for about a week on a battery charge, and
are seen clearly without glare in bright sunlight. Advanced versions
of new-generation screen technology are expected to be thin and
flexible. Imagine a magazine-sized screen that can be rolled up like
a scroll and tucked away in your pocket. Some people are already
calling this “electric paper.” Sprint recently started an ad campaign to
prep cell phone users for the paper-liberating devices to come.
Continued on page 29
2 n d I ss u e 2 0 0 9
 Efficient IT Planning is Key to Recession Survival
T
he financial crisis may not be the
only thing putting a strain on your
business. If your IT upgrades didn’t
keep pace with your growth during the
boom years, chances are expensive inef-
ficiencies are starting to get noticed. Sur-
viving a tough economy requires all of us
to be as efficient as possible, which means
it’s time to take a hard look at productiv-
ity problems created by poorly planned IT
systems.
I have worked for several companies that
allowed their IT to become grossly ineffi-
cient because systems were allowed to grow
haphazardly with little or no planning.
Let’s just say newspaper and magazine pub-
lishers are the poster children for bad IT
systems. During the course of my career, I
have seen some amazing debacles.
The saga usually went something like
this: An off-the-shelf system is purchased
on the fly without taking growth or chang-
ing needs into account. When deficiencies
inevitably occur, management hastily opts
for quick fix add-ons instead of upgrading
thoughtfully with the future in mind. This
results in redundancies, unnecessary proce-
dures that could be consolidated and all the
other problems and mistakes that pop up
when systems don’t share or use the same
information.
Case in point: I once worked for a fast-
growing company whose accounting issues
grew beyond the reach of QuickBooks. The
CFO refused to dedicate time or resources
to properly upgrade the IT to keep things
straight as we grew. He addressed everyday
issues by instructing his staff to create a
web of individual spreadsheets to manually
reconcile what the main system couldn’t. As
a result, it was impossible to know where
the company stood in real time, and it was
always a major research project to find out.
This company eventually collapsed due to
unexpected cash flow problems that often
shocked the CFO. He was also amazed
how difficult it was for the company to op-
2 n d I ss u e 2 0 0 9
By David Whitehead
erate profitably. But none of this surprised choice rather than forming an IT team to
me after spending several years working for create a consolidated system that made
him. sense not only for what the company did,
On the operations side, the company but also for how it planned to grow.
heads also planted too many IT seeds that Their disjointed systems worked just fine
bore incompatible fruit. They had to man- for a number of years when the company
age projects and ongoing information for was small. But when they grew substantial-
client servicing, which in many cases held ly, the information in all of these databases
the same information used on the sales, grew unwieldy. Staff laboriously inputted
accounting and finance sides. When they the same information in different systems
were very small, they used Microsoft Proj- that not only couldn’t communicate with
ect to manage production issues and ACT, each other, but were often not even ac-
which is really a sales contact manage- cessible to the very people who needed it.
ment software, for client servicing. When Even if you had access to the system, it was
they formed a business development team, a chore to find anything if you didn’t work
they started a separate ACT database for for the department that maintained it.
sales. And to make matters more compli- They eventually began to transfer produc-
cated, they serviced customers by keeping tion and client servicing from spreadsheets
the contact information on spreadsheets. to a custom-designed Filemaker system, but
This happened because different manag- the CEO refused to allow this type of com-
ers picked their off-the-shelf solutions of Continued on page 30
I realize that during a booming economy, companies get
too preoccupied with their core business to notice the
monsters they often create with their IT management.
Bad feelings and finger pointing result when these
kinds of problems lead to horrible mistakes or create a
productivity gridlock.
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S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e 
COV E R F E AT U R E

Green Biz
5 South Bay Organizations
Upping the Eco Ante
By Brian Simon

W
hile entire nations must grapple with the harsh implications
of “global warming” and how to address it, it will ultimately
take cooperation on an individual grass roots community
level to spread the message espoused by leading scientists to make a mean-
ingful impact across the country. With that in mind, a number of South Bay-
based businesses, agencies and cities have already made their mark on the
green front. Here is an overview of a few notable contributors to the cause.
Homestead Realty West Makes Environment a Realty Show
When thinking about traditional “green” businesses, real estate companies typically don’t come to mind. But last fall, Manhattan Beach-
based Homestead Realty West became the first business in the South Bay and the first real estate office in the country to achieve green cer-

4
tification through a Hermosa Beach-based firm (Green Certifications) that uses at least 110 separate criteria—and virtually no paperwork
in the process—to assess a business’s environmental performance and, if that business passes muster, then recognize the accomplishment.

 S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e 2 n d I ss u e 2 0 0 9
Efficiency, reduction and conservation are are getting more environmentally efficient. lets, and landscaping that requires minimal
the key areas considered, with various sub- I think it will turn into something spec- watering. “Everything new that gets built
categories attached. So businesses that like tacular eventually. All our agents are really will have stricter standards,” added Birken-
to think of themselves as “green” can actu- excited about it. It’s still all so new.” feld.
ally take specific steps to get there and then Speaking of housing, Homestead recently Meanwhile, the real estate world itself has
flat out prove it with an independent cer- moved into a new energy-efficient building upped its own green ante. The National
tification. with tank-less water heaters, low-flush toi- Continued on page 14
“We had to get our office as environ-
mentally friendly as possible,” said Sabine
Birkenfeld, Realtor and Certified Inter-
national Property Specialist who joined
Homestead in the early ‘80s. To qualify, the
company took a number of steps, including
keeping recycling bins in the office; using
environmentally-friendly cleaning supplies
and paper products; conserving electric-
ity by not keeping computers on at night
and using energy-efficient bulbs; and con-
tributing dollars to local environmentally
supportive projects such as the Redondo
Beach Sea Lab.
“We also encourage clients from out of
town to rent hybrids,” added Birkenfeld,
who said that one challenge for Realtors
is that they have to use cars to get to the
properties for previewing and showing.
“We can’t walk our clients around. Because
we do a lot of driving, we have a carbon
offset program where each year, depending
on the mileage driven, we buy wind power
credits.”
Homestead Realty West began its quest
for certification about a year ago. “You fill
out everything you do step-by-step,” said
Birkenfeld, who admitted that some goals
are difficult to achieve, such as finding a
local printer who uses environmentally-
friendly inks to make up business cards, or
locating a green pest control outfit.
Though getting certified certainly costs
the company money, it may also bring it
some new business as well to potentially
help offset the price of the aforementioned
offset. “We’re just in the beginning stages
of getting the word out, so ideally we want
attract the types of clients who are like-
minded and are supportive of someone like
us who also care about the environment,”
said Birkenfeld. “At the same time, we hope
it will raise awareness and inspire others
in the community to follow suit. The next
trend will be green housing where homes

2 n d I ss u e 2 0 0 9 S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e 
L I T I G AT I O N I N S I D E R
7 Steps to Surviving a Lawsuit
By Kurt Schlichter, Esq, Attorney at Law
A
s the economy worsens,
more businesspeople find
themselves being sued.
Getting sued is no fun even in
the best of times. You are mind-
ing your own business when some
vaguely disreputable gentleman
steps up and hands you a batch of
papers, announcing that you have
been served. Reading the “Com-
plaint for Damages,” you do not
recognize yourself. The facts are all
wrong and many of the allegations
are outright lies. The “plaintiff ” has
accused you of all sorts of misconduct and claims everything you
did was part of some deliberate scheme designed to defraud him.
Welcome to the world of business litigation. Now what?
Understand first and foremost that lawsuits are about money; you
need to look at litigation from a business perspective. The key to
coming through litigation with the optimal outcome is to under-
stand the process and to make smart, well-reasoned business deci-
sions at each of the seven critical steps.
Step One: Stop, Think and Lawyer Up
You have read the complaint and you are furious. Your first idea is
to reach for the phone and give your opponent a piece of your mind.
Or maybe you think that once you explain what really happened, he
will drop the suit. These are bad ideas.
Plaintiffs tend not to sue unless they are serious about their objec-
tive. You are not going to talk your opponent – or his lawyer – out
of the lawsuit. You are more likely to just say something that will
come back and haunt you.
You need professional help – not only for the technical legal mat-
ters, but because you are emotionally involved, and emotional deci-
sion-making is bad business. Unless you think do-it-yourself sur-
gery is a good idea too, you need a lawyer (and if your company is
a defendant, you must have a lawyer). Litigation is a harrowing,
frustrating process, so you need to pick a lawyer who is not only
technically proficient but one with whom you can relate. Talk to
several. Find one whose personality suits you. If you are chatty
and need hand-holding, do not hire a ringer for Mr. Spock. If you
think General Patton was a little restrained, do not retain Mr. Rog-
ers, Esquire.
And do not delay. The clock starts running once you have been
handed the papers. You would be shocked at the number of intel-
10 S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e
ligent businesspeople who are served with a lawsuit, put it in an “in”
box and do nothing until the notice of default arrives in the mail.
Step Two: Determine Your Budget
You have settled on a lawyer. Now you need to figure out how to
pay for her.
The best defense is one where someone else pays the bill. Your in-
surance policies might provide a legal defense as well as pay a judg-
ment against you. Tell your lawyer about your insurance coverage
– business, auto and even home. Insurance usually covers claims in
which you are accused of doing something unintentional, like caus-
ing an accident. It typically does not cover intentional wrongs, like
fraud or claims that you breached a contract. If there is even the
most remote possibility that the insurer will “accept your tender,”
make your claim. Yes, it may make your premium go up a couple
hundred dollars a year, but considering that many business lawyers
charge north of $300 per hour, you may as well use your coverage.
Your ability to pay for your defense is key to determining your
initial strategy, just as finances are key to your routine business de-
cisions. Even a mid-sized case can cost $50,000-$100,000 in legal
fees through a verdict. If you are paying the fees yourself, you will
need to put a substantial amount down as a deposit and then pay
the monthly bill. Ask for an estimate, understanding that the final
total will likely end up higher. If you cannot afford to defend your-
self, you need to know that when evaluating your options.
If you win, the other guy has to pay your attorney fees, right? Sor-
ry. Except where the dispute is on a contract with a provision for
the recovery of legal fees, parties generally bear their own attorney’s
fees. All you get back if you win is a judgment for some of your out-
of-pocket costs, like filing fees.
Step Three: Responding
Sometimes the best response is no response. If you have no as-
sets and no way to fund a defense, perhaps it makes sense to let the
other side take a default judgment. A judgment that cannot be col-
lected is no judgment at all. Similarly, if the claim against you is big
enough – and does not involve fraud or similar wrongs – you might
consider bankruptcy, which could discharge the entire claim against
you along with many of your other obligations. Sometimes talking
is the best plan – perhaps your lawyer can settle the case early for a
reasonable amount.
Usually, you will end up responding to the lawsuit. The most com-
mon response is an “answer.” This is a document that essentially
denies everything the complaint says and asserts various defenses.
Another option is a “demurrer.” A demurrer is a motion that es-
2 n d I ss u e 2 0 0 9
sentially says that even if everything in the complaint is absolutely
true, the plaintiff is not entitled to win. Demurrers rarely kill a case
completely; they are best in more complex cases for cutting down
the number of theories against you. They are also expensive, but
where appropriate they are invaluable.
Step Four: Discovery and Motions
Much of the time spent in litigation is in the “discovery” process,
where your attorney gathers evidence by demanding documents
from the other side, sending them written questions and taking
“depositions” – interviews of parties and other witnesses with law-
yers and a court reporter present. Discuss discovery strategy with
your lawyer to ensure you are getting the most bang for your buck
– weigh the costs versus the benefits of each step in your lawyer’s
discovery plan.
The other side will also do discovery on you. You will be verifying
your discovery responses (which your attorney drafts) under pen-
alty of perjury, so be truthful and complete. Eventually, the plain-
tiff will take your deposition. Remember to provide truthful, clear
answers and avoid saying snarky things that will reflect poorly on
you should the transcript be read to the jury. Take your discovery
obligations seriously – if you fail to respond in time or truthfully,
the results can be disastrous.
Your attorney may suggest making a “Motion for Summary Judg-
ment” (“MSJ”). An MSJ is different from a demurrer in that you
can use some of the evidence you have gathered to ask the court
to rule in your favor because all the basic facts of the case are un-
disputed. Contract cases where there are a lot of documents are
often good MSJ candidates; cases where the evidence is primarily
the contradictory testimony of the parties are bad MSJ candidates
because the facts are disputed.
MSJs are an invaluable tool for defendants because they have the
capacity to kill a case outright without going to trial, but they are
hard to do correctly because of the many procedural rules. MSJs
are also expensive, though not nearly as expensive as a trial.
Step Five: Settlement
The fact is that 97 percent or so of cases never go to trial. Some
are dismissed voluntarily – yes, occasionally plaintiffs just abandon
their lawsuits. Others are defeated by demurrers or MSJs. The
majority, however, are settled.
Settlement is not exactly a step, but a process. You can settle at
any time. Figure out early on what you would pay to settle your
case. Paying on a claim you know has no merit is galling, but your
monthly legal bills will dramatically demonstrate that principle
comes with a hefty price tag. Again, in business litigation, the wis-
est decisions are business decisions.
The courts love settlement – it clears their dockets – and order
2 n d I ss u e 2 0 0 9
formal settlement talks in almost every case. Sometimes this takes
the form of a settlement conference in front of a judge. There are
also professional mediators. The judge or mediator will work with
the parties, point out weaknesses in their cases and try to create a
compromise. You will need to be personally present, along with
your lawyer. Sometimes you will feel pressured to settle – perhaps
even by your own lawyer. That is not necessarily bad; they might be
telling you something. However in the end, the decision to settle
is always yours.
Abraham Lincoln started his career as a lawyer – nobody’s perfect
– and urged his fellow lawyers to try to settle:
“Discourage litigation. Persuade your neighbors to compromise
whenever you can. Point out to them how the nominal winner is
often a real loser -- in fees, expenses, and waste of time.”
—From Abraham Lincoln’s Notes for a Law Lecture, dated July 1,
1850.
Of course, Lincoln is less famous today for his willingness to
compromise than for his steely resolve as he led the United States
through its bloodiest war to the unconditional surrender of its op-
ponent.
Step Six: Trial
The laws of probability dictate your case is unlikely to be tried to
a verdict. But some cases cannot and should not be resolved. You
need to be prepared to be one of that three percent.
First, decide whether or not you want a jury. The parties can “waive
a jury” and let the judge act as the finder of fact instead of only rul-
ing on issues of law. Juries are often best where your case has a
large emotional component. Consider a judge when you depend on
a clear but perhaps nitpicky application of law.
Trial preparation is an expensive endeavor. Expect that your at-
Continued on page 25
Understand first and foremost that lawsuits
are about money; you need to look at litigation
from a business perspective. The key to coming
through litigation with the optimal outcome is
to understand the process and to make smart,
well-reasoned business decisions at each of the
seven critical steps.
S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e 1 1
A R E A L E S TAT E P RO ’S P E R S P E C T I V E
The Real Estate Weather Report
Keep Umbrellas Handy and Make Hay When the Sun Shines
I
f the real estate climate was reported like
the weather, it might sound something
like the following:
“Expect the stormfront in the South Bay
real estate market to continue with cold tem-
peratures, scattered showers, and occasional
gale force winds in the middle class areas,
gradually giving way to partial clearing and a
warming trend for first-time buyers with the
worst behind us for the high-end market.”
One of the barometers of the real estate climate is the number of
foreclosures being filed in a city. While this really doesn’t paint the
whole picture since need to take into consideration the number of
short sales (where the sellers owe more than the home is worth and
the bank agrees to take the loss and allow the homeowner to walk
away) and other distressed sales, it’s a pretty good indicator. As the
flood of distressed properties subsides, a more normal market will
emerge with real live people as sellers rather than institutional sales
dictating market values.
Let’s look at the number of properties in foreclosure where the
notice of default has been filed and the clock is ticking, along with
properties recently foreclosed on and sold at a trustee sale. Remem-
ber, if a property is in foreclosure, it doesn’t mean it will go to sale.
Homeowners may redeem their home by paying the amount in ar-
rears and thus cancel the foreclosure. As of this writing, the num-
ber of homes either in the process of or recently foreclosed upon in
the South Bay looks like this: Manhattan Beach – 69, El Segundo
– 27, Hermosa Beach – 56, South Redondo Beach – 84, Palos
Verdes, Rolling Hills – 53, Rancho Palos Verdes – 105, San Pedro
– 384, Torrance – 624, Hawthorne – 513, Lawndale – 222, North
Redondo – 112, Lomita – 81, Harbor City – 161 and Gardena
– 605. As you can see, sellers are still weathering the storm.
On the national real estate scene, the Mortgage Bankers Associa-
tion reports that during the first quarter of this year, 12 percent of
all homeowners with a mortgage are behind in their payments. And
half of those, or six percent, are borrowers with good credit and
fixed rate mortgages! This tells us that job losses are wreaking havoc
with the well qualified borrowers as well. This is in stark contrast to
almost 46 percent of all subprime mortgages currently in default.
For buyers, however, and especially first-time buyers, you could
find yourself in the eye of the storm with blue skies and warm
weather. The affordability index in the Western States has in-
creased 40 percent from a year ago and is at a 30-year high. This is
due to a combination of falling prices and historically low mortgage
rates. If that doesn’t lift the gloom, there is a federal tax credit of up
12 S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e
to $8,000 for first-time buyers that earn $75,000 or less as single
filers, and $150,000 or less for those married filing jointly. (With
joint income over $150K, there is a gradual phase-out of the credit
going to zero at $170K combined). This is a tax credit that reduces
the amount of federal income tax you pay dollar-for-dollar by up
to $8,000, as calculated by taking 10 percent of the purchase price,
not to exceed $8K. (For more information go to http://www.feder-
alhousingtaxcredit.com/2009/home.html).
Another silver lining in the cloudy forecast is a $10,000 state tax
credit for new construction purchases by first-time or existing ho-
meowners between 3/1/09 and 03/01/10, with no income restric-
tions. Break out the sunglasses, sunscreen and swimsuits! There is
$100,000,000 allocated by the state for this on a first-come, first-
serve basis. (For more information, go to http://www.ftb.ca.gov/in-
dividuals/New_Home_Credit.shtml).
Many of us noticed that mortgage rates rose dramatically in the
first week or so of June. This potential cold front could develop into
another major storm, causing the economy to stall and double dip.
The Fed knows the foundation of a sustained economic recovery is
rooted in shoring up the real estate market. The home value freefall
needs to cease, and jobs need to be created before consumer confi-
dence and spending can return.
The mortgage rate spike occurred for several reasons. First, toward
the end of May, Bill Gross, the “Warren Buffett of the bond world”
who manages the PIMCO Total Return Bond Fund, came out and
stated the possibility exists that the United States could lose its
AAA rating as a creditor by the rating agencies. Next, we got a few
flickers of positive economic news. Not good news—just econom-
ic data that disappointed less! But what really caused a mortgage
bond selloff and drove rates up is what some are calling “the Fed’s
dilemma.”
As we may recall, mortgage rates initially dropped at the end of
last year. The Fed made the announcement that it was going to buy
mortgage-backed securities from Fannie Mae and Freddie Mac di-
rectly, and committed $600 billion toward that end. Accordingly,
rates dropped from the 5.25-5.50 percent range to the 4.50-4.75
percent range virtually overnight. Because the Fed became a buy-
er, it decreased supply and increased investor demand, ultimately
pushing rates lower.
Now, however, the Fed is issuing record amounts of treasury
bonds to finance the corresponding record amount of spending.
That is creating a glut of supply, weakening demand from investors
and pushing rates up. So the Fed is buying mortgage bonds, try-
ing to push mortgage rates lower, with money borrowed from sell-
2 n d I ss u e 2 0 0 9
For buyers, however, and especially first-time buyers, you could find
yourself in the eye of the storm with blue skies and warm weather. The
affordability index in the Western States has increased 40 percent from a
year ago and is at a 30-year high.
ing treasuries causing rates to go up. This the previous lows to the mid-five percent here in the South Bay, they may have bot-
is kind of like that time the kitchen sink range currently. Many feel (and many more tomed out as well. The affordability index
was stopped up and you took the plunger hope) that the bond market sell-off was an is the best in decades. Generous tax credits
to the left side of the sink and pushed the overreaction and that it is just part of the are available for home buyers. FHA financ-
water down only to have it rise right back incredible volatility we continue to experi- ing allows buyers to purchase with as little
up on the right side! The Fed needs to find ence in the stock and bond markets on our as 3.5 percent down. Conventional financ-
a way to continue to pressure mortgage long journey back to economic recovery. ing requires just 10 percent down with loan
rates lower again until the economy truly And participation at the treasury auctions amounts up to $729,750. With 20 percent
finds a foothold and moves in earnest to- has been met with reasonably good partici-
down, there is financing available on loan
ward expanding again. Part of the trick will pation by foreign investment.
amounts up to $1 million; and from 25
be to convince foreign investors like Japan We don’t know how low rates will go as
percent down to $2 million.
and China to continue to buy our trea- a result of this rally. What we do know is
So if you’re a first-time home buyer or
suries, which will help mop up the excess that the economy may be finding a bottom
supply that is hitting the market. If foreign soon. Some feel the so-called “Great Reces- looking at making a move-up purchase,
demand wanes, it causes bigger supply and sion” may officially be over this year. But it your timing couldn’t be more perfect. You
less demand, forcing up rates to attract in- may take far longer for a new crop of jobs may find yourself one happy camper who
vestment dollars. to be cultivated. That’s what the average made hay while the sun shines!n
The good news as of this writing is that American really needs to see in order to de- Ken Roberts is a mortgage planner with
mortgage bonds are starting to rally again, clare the recession is history. over 30 years experience in the South Bay real
causing mortgage rates to improve. Rates Mortgage rates are good and improving estate market. Ken can be reached at (310)
had increased about one percent from again. Real estate prices have declined and 534-6200.

Have Your Sales Commissions Declined

With the Rest of the Economy?
See if We Can Help You Fill the Gaps.
If you’re a 1099 sales pro interested in a part-time position earning generous sales commissions
while keeping your current position, give us a call. Business Insider Magazine is seeking a part-
time Advertising Sales Representative to sell display advertising to South Bay companies. We
pay commission percentages above the industry average, offer a chance to work locally and will
provide guidance to ensure your success. If you are an experienced sales pro from the real estate
or financial services industries, this opportunity could be ideal for your situation.

Call (310) 872-9732 or email your resume to Publisher@BusinessInsider.us to learn more about this opportunity.

2 n d I ss u e 2 0 0 9 S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e 1 3
 G R E E N B I Z COV E R F E AT U R E
“We’re just in the beginning stages of getting the word out, so
ideally we want attract the types of clients who are like-minded
and are supportive of someone like us who also care about the
environment,” said Birkenfeld. “
Sabine Birkenfeld, Homestead Realty West
Continued from page 
Realtor Association now offers a two-day
Green Designation Program—a two-day
course that teaches real estate profession-
als how to list and market green properties,
while passing on vital information to their
clients about the latest green standards and
initiatives.
“It’s an ongoing process where you try to
Sabine Birkenfeld do better each month and each year in order
to achieve a higher and higher percentage of
green activity,” said Birkenfeld. “You just have to make a concerted
effort to be conscientious.”
Cities Lead the Way to Greener Pastures
In order to encourage businesses and residents to jump on the
green bandwagon, city governments must lead by example. Several
South Bay communities have developed environmental action plans
and incentives to do just that.
Even before a recent spate of green activities, the City of El Segun-
do boasted a strong track record in environmental responsibility. El
Segundo is among the top handful of cities in California in divert-
ing solid waste to recycled products or other uses. Also, at least half
of the water used in El Segundo is reclaimed, cleaned and recycled
for use. That statistic leads the state.
On a related note, El Segundo recently garnered recognition for
its water conservation program from Southern California Edison
as part of the latter’s annual Flex Your Power awards, and received
grant monies from regional water agencies to launch banner pro-
grams spreading the message about reducing water use.
Meanwhile last year, El Segundo became the first South Bay com-
munity to become part of the globally acclaimed “Re-Use-It” net-
work—an online forum where citizens can ensure their unwanted
stuff doesn’t end up in a landfill, but instead gets into the hands of
those who truly need those items.
El Segundo adopted its own environmental action plan in January
2008 containing more than two dozen priority items to consider as
14 S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e
steps to achieve “a more green and sustainable community.” Major
categories include energy conservation, solid waste reduction, com-
munity design standards, community environment, transportation,
environmental health, water conservation and environmental coun-
cil.
An Environmental Committee, appointed by the El Segundo City
Council last fall, has taken on a large workload of green items, in-
cluding a green building ordinance. “We’re also working on creating
a green building resource center inside City Hall for residents and
developers to obtain literature on green building,” said El Segundo
Senior Administrative Analyst Lauren Mahakian, whose job in-
cludes handling all of the City’s environmental outreach. Speaking
of green building, the City hopes its new Fire Station 2 now under
construction will achieve LEED certification for environmental re-
sponsibility. Additionally, El Segundo continues to look at ways to
reduce greenhouse gases while also saving itself some money over
the long haul. Over the past year, it has installed LED traffic signals,
replaced multiple office machines with all-in-one energy-conserving
equipment, and picked up a couple of gas-efficient hybrid vehicles.
To engage the community, the City
scheduled several eco-events this
year, including a free composting
workshop that took place in May,
a high-efficiency toilet giveaway on
June 13 and a free gardening and
landscape workshop on June 27
where residents learned how to cre-
ate ocean-friendly gardens using in-
digenous plants and water-efficient
devices. Lauren Mahakian
On July 2, the City hostsed its sec-
ond annual Environmental Expo. More than 1,000 people attended
the inaugural event last year that featured a variety of green and
conservation-related vendors. “This year, we had electric bikes and
vehicles, eco-friendly racing cars, electronic waste recycling drop-
off, and (Assemblymember) Ted Lieu available to answer questions
about state legislative efforts regarding water conservation.” Maha-
kian said women could also donate their unwanted business attire
to the non-profit organization Working Wardrobes, which helps
2 n d I ss u e 2 0 0 9
 “It’s a great opportunity for the City to look at what policies to
implement to help the environment, and what we can do in the
future. The programs span across all departments of the City,
including public works, parks and recreation and community
development. There’s much to be done, but everyone is very
knowledgeable and committed to making it happen.”
Sona Kalapura, City of Manhattan Beach

women in difficult financial shape or those who have endured other
life crises to build confidence to enter the workforce. “This is a won-
derful cause that helps both the environment and women in need,”
said Mahakian.
In September, El Segundo hosts the second annual South Bay En-
vironmental Excellence Development (SEED) awards event honor-
ing groups and businesses that have exhibited top-rate performance
in environmental sustainability and targeting areas such as alter-
native energy, energy efficiency, environmental education and out-
reach, green building, and more.
And finally, a series of free green workshops is set to kick off this
fall. “This will provide perspective from both sides of the planning
counter to educate residents, architects, builders and developers
about various green topics,” said Mahakian.
While such programs and events won’t solve the world’s environ-
mental problems, every little bit helps. “If each individual commu-
nity does its part, we can make a difference,” said Mahakian.
While Manhattan Beach garnered widespread media attention
last year when its City Council passed an ordinance banning plastic
bags, that move was just one component of an overall commitment
to environmental responsibility that began to truly take shape in
2007.
In November of that year, the City of the Manhattan Beach re-
leased its comprehensive Green Report
that, among other things, outlined a com-
mitment to develop a Climate Action
Plan (CAP) to reduce local greenhouse
gases and carbon dioxide emissions to
at least seven percent below 1990 levels
by the year 2012. The 19-member Envi-
ronmental Task Force (appointed by the
Manhattan Beach City Council last sum-
mer to make recommendations on cur-
rent green policies and future improve- Sona Kalapura
ments) and Environmental Programs
Manager Sona Kalapura oversee the CAP’s development. The City
also created an interdepartmental Green Team to identify current
“green” practices, and set the climate protection goal. The tight time-
frame means the group has its work cut out for it.
“When the City released the Green Report, it included an assess-
ment comparing 1990 levels to 2005,” explained Kalapura, whose
position was created last summer. “Based on those numbers, we’ll
have to reduce our carbon footprint 20 percent from 2005 levels
alone.” Though the City has already taken such measures as using
LED energy-efficient lighting and turning off computers after the
Continued on page 26

“We’re also working on creating a green building

resource center inside City Hall for residents and
developers to obtain literature on green building.”
Lauren Mahakian, City of El Segundo

2 n d I ss u e 2 0 0 9 S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e 1 5
PUBLISHER’S PERSPECTIVE
The Empire With
the Invisible Throne
By David Whitehead
T
he United States has a schizophrenic nature when it comes
to the word “empire.” This nation spent the first half of its
existence defending itself against imperial domination. Then
it spent the second half building an empire of its own. As a result,
Americans are not comfortable hearing their nation characterized
as an empire. Most prefer to think of their nation as a republic that
occasionally issues imperial directives to defend its interests. When
pontificating fails to persuade, the empire enforces global economic
power through a curious combination of economic and conven-
tional warfare.
America was drafted into the imperial club by the old empires
of Europe when their taste for imperial adventure was soured by
two devastating world wars. A bankrupt United Kingdom had no
choice but to relinquish its imperial role to the United States. The
Bretton Woods agreement was the formal acknowledgment of this
power shift.
The new imperial throne is invisible. There are no formally ac-
knowledged vassal states, although subordinate powers are expect-
ed to know who they are and act accordingly. And like all others
that came before, America’s empire is destined to bankrupt itself if
it holds to this course. Only the shadowy financial empires, which
control capital that builds and destroys political empires, are in a
position to capitalize most of the time.
The founding fathers sought to avoid this fate for our nation and
fought hard to keep old world imperial structures out of the Ameri-
cas. However, the Monroe Doctrine proved a complete failure as this
nation succumbed to the seduction of grandeur driven by treachery
from dark corners in the financial world. We incorporated our new
imperial position into our emerging nationalism. In the most con-
voluted way, America professed its republican values while denying
16 S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e
the actual dynamics of its empire and how it affects the rest of the
world. I think this explains many of the moral contradictions that
divide this nation politically. It also places us in a very dangerous
position. Dangerous because of the empire’s long-term implications
and more so because its existence is virtually ignored by most of the
American people.
Whose Throne is It Anyway?
The invisible empire took its current form in the early seventies.
The Nixon administration, under the orchestration of long-time
Rockefeller family colleague Henry Kissinger, re-invented what ap-
peared to be a collapsing U.S. economy. America became the spear-
head for the emerging global economic order.
During this period, most nations transitioned from self-sufficient
to interdependent. Economies that once depended on their own
sinew to leverage their resources while defending their sovereignty
through balanced trade succumbed to a system that made them de-
pendent upon one another.
Arcane monetary policy was key to the emerging order. It’s one
thing to have global reserve currencies backed by the wealth and
economic output of a sovereign nation to help stabilize the global
economy. It’s quite another to create internationalized currencies
like the Euro representing unions of less-than-sovereign nation
states. And should the shifting paradigm lead to the further inter-
nationalization of central banks to restore order to the global fi-
nancial system, a dollar that is genuinely sovereign may no longer
be possible.
To put the financial crisis facing the U.S. in perspective, Richard
C. Cook, a former analyst for the U.S. government and frequent
contributor to the website GlobalResearch.ca, recently juxtiposed
2 n d I ss u e 2 0 0 9
some shocking statistics regarding the impact of the nation’s aggre-
gate debt:
“During fiscal year 2009, the U.S. Treasury is on track to pay over
$500 billion just in interest payments to finance the already-exist-
ing debt. New debt this year will likely exceed a trillion dollars. The
total debt burden on the economy as a whole could reach $70 tril-
lion by 2010, with annual interest payments for individuals, house-
holds, businesses, and all levels of government likely to reach $3
trillion out of a $14 trillion GDP that is now in sharp decline.”
First, the $500 billion in interest payments just on the existing
debt cancels out a good chuck of the $787 billion stimulus, which
by the way will accrue its own compounding interest down the
road. The trade deficit, which peaked at over $750 billion in 2006,
has dropped markedly due to the decline in demand for consumer
goods. However, the U.S. has not reported a positive balance of
trade since 1975! The reported federal deficit reached above the
$10 trillion mark this past year and will undoubtedly rise more as
the war in Afghanistan escalates. However, according to Cook, the
combined obligations of the nation are approaching $70 trillion.
This is $5 trillion more than the planet’s annual productive output
of $65 trillion! That’s why economists with the courage to acknowl-
edge the math are getting apocalyptic with their forecasts.
The Dawn of Radical Intervention
The last time the central bank forced the economy to make a radi-
cal correction on its own, it caused The Great Depression. You could
say The New Deal was the first radical intervention to alleviate this
kind of calamity. But few questioned how radical it was in 1971
when the U.S. went off the gold standard while the dollar remained
the world’s reserve currency. I personally had to do a great deal of
reading to understand why this was a dangerous position for the
U.S. economy. To be fair, I would have to say many financial experts
at the time would have had difficulty knowing why this was danger-
ous themselves without the benefit of hindsight. The financial com-
munity pushed the limits of abuse far beyond what any reasonable
person could have imagined 38 years ago.
Economies can function off the gold standard if the agency en-
trusted to issue currency ensures money supply has a rational rela-
tionship with GDP. Currency should be issued in quantities neces-
sary to facilitate commerce while retaining a stable value that also
facilitates beneficial trade free of mounting deficits.
... should the shifting paradigm lead to the further internationalization
of central banks to restore order to the global financial system, a dollar
that is genuinely sovereign may no longer be possible.
2 n d I ss u e 2 0 0 9
Because the Federal Reserve is owned by private investors and
operates for profit, conflicts of interest develop at many levels that
favor ultra-wealthy financial speculators and ultimately do great
harm to the American people they are entrusted to serve. And as
the issuer of the world’s key reserve currency, foreign investment
frees the Fed from keeping the money supply closely tied to the
nation’s real productive output. Instead, they leverage the wealth
of nations who must hold dollar reserves to function in the global
marketplace. This allows the Fed to expand the money supply to
irrational levels while incurring mounting debt along the way. De-
veloping nations in turn play their currencies off those of the con-
sumer nations in the West. This radically altered the way many of
us earn our livings today.
The process the Fed uses to create money via the nation’s banking
system also creates interest, as does the leveraging of foreign invest-
ment. The debt gets packaged and repackaged again in countless
ways that make it questionable whether it can ever be repaid. The
process used to get currency into the market is more of a lending
process than a reflection of the nation’s actual wealth. Whoever
thought it was a good idea to package the debt of people and insti-
tutions operating in this kind of environment as investment instru-
ments to be sold back to many of these same indebted consumeroids
was either not paying attention or deliberately creating a massive
Ponzi scheme.
In the wake of 9/11, most people barely noticed when the Federal
Reserve bottomed out interest rates. This occurred right after the
dotcom crash at a point when the economy was due for a correc-
tion. Instead of letting some overdue austerity set things right, the
economy was flooded with easy cash. People in a position to capital-
ize speculated their way to the good life.
This is the system of the last 38 years reaching its apex and it is run-
ning out of steam fast. The current bailout strategy is more about
repackaging and expanding debt to astronomical levels, which won’t
create real prosperity. The system must change and change soon.
But to what?
Putting Humpty Together Again
First I will address what we can’t do, which is business as usual. If
we let the dollar implode, the American people will not be in a posi-
tion to regain control of our money supply and ultimately our des-
Continued on page 24
S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e 1 7
PUBLISHER’S PERSPECTIVE
The Financial Crisis:
Finding the Bottom
By David Whitehead
“The recession is over!”
So proclaimed our perpetually upbeat sales manager as he saun-
tered into an early morning meeting in the spring of 1994. The au-
thority he relied on to substantiate this dubious claim was an overly
optimistic news report. His dutiful employees, including myself,
didn’t quite know what to make of this. We were still encounter-
ing enormous resistance while good customers continued to call on
us to advertise their “going out of business” sales. This depressing
stream of new business predicated on helping long-time companies
liquidate their inventories in short order continued for some time.
In fact, the national recession was officially over by the time Bill
Clinton entered the White House in 1992. However, defense cut-
backs following the 1991 Gulf War kept the pain lingering in the
South Bay for several years. Most businesses didn’t see real prosper-
ity take off again until 1997 when the dotcoms and a newly revital-
ized real estate market moved things up again. We had to wait for
the recession to end and look back at the historical data to know
where the bottom that mattered actually was. And I expect we will
have to do that again in a few years when things settle down. Per-
haps asking, “When will we find the bottom?” is the wrong ques-
tion. Instead we should ask, “What is the bottom?”
The “bottom” in an economic downturn is the point when enough
money has been eliminated from the economy from interest paid
on current and previous debts for the maestros of finance to orches-
trate another money bubble to move things up again. That’s what
the dotcom and real estate booms were really all about. And not
surprisingly, both of these booms crashed as quickly as they rose.
What’s different this time is the economy has become so bloated
with debt that government officials and central bankers are hor-
The modern U.S. economy relies on
foreign investment to provide the cash
necessary to run the financial and service
sectors where most Americans earn
their living. ..The next four decades will
require something entirely different that
probably won’t involve our precious
“dead presidents.”
18 S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e
rified to let the economy find the bottom on its own. Hence the
unprecedented waves of multi-billion dollar bailouts and stimulus
packages created out of thin air.
If “bottom” is supposed to mean the lowest point the economy can
fall, then what we are looking for is not really a bottom at all. It’s a
low point in a continuous cycle that has had many low points. But
it certainly is not the lowest point attainable. That means it is not
inconceivable for the aggregate burden of debt to create the kind of
“bottom” that is really a precipice for a greater fall. Could this be
the bottom tantamount to Wall Street’s greatest nightmare? If the
economy ends up where it appears to be going, the answer is a re-
sounding “yes.” However, the same maestros of finance who brought
us to this point have shown remarkable creativity in developing new
economic models flashy enough to perpetuate lucrative business cy-
cles for decades. The current model is undoubtedly reaching its end.
So what could they do to save us from our impending oblivion? It
certainly can’t be another stimulus that can never be supported by
our economy. Or can it?
Spring Blooms Uncertainty and Special Drawing Rights
The only thing that bloomed this spring was more uncertainty.
The first quarter of 2009 saw multi-billion dollar bailouts, reversals
of fortune for global manufacturers and desperate anticipation for
this economic crisis to find its “bottom.”
However, consumer confidence soared in May as the Obama ad-
ministration’s $787 billion stimulus packages started to take hold—
at least in people’s minds. An industry group called The Conference
Board told Reuters in late May that its index of consumer attitudes
jumped to 54.9 in May, up from a revised 40.8 in April. This is well
above earlier forecasts centered around 42.0. This represented the
biggest one-month jump since April 2003, attributed to belief at
the time that the Iraq war was coming to a rapid conclusion. How-
ever, does this mean a genuine recovery is in progress?
Death and taxes are not the only things in life that are certain.
We forget about interest due on the money we create through bor-
rowing at the central banking level. That means the $787 billion
stimulus is certain to lead to an even deeper bottom to be averted
by, well, another multi-billion or perhaps trillion dollar stimulus the
economy could never hope to support. This is a bad habit we just
can’t seem to break.
Does this mean the financial judgment day is close at hand? Can
we expect to see Seven Horsemen from the Bank for International
Settlements appear to reveal our final dispensation? The best finan-
cial experts cannot agree on this point. However, it would behoove
us to examine some alarming events that have recently taken place.
2 n d I ss u e 2 0 0 9
 Special Drawing Rights Paint Bleak Picture for the Dollar
The G20 nations recently authorized the International Monetary
Fund, the post-war global banking house run by Europeans, to in-
ject $250 billion into the global economy using an obscure mecha-
nism called “Special Drawing Rights.” SDRs bypass the leading
reserve currency to instead issue funds based on a basket of major
world currencies. This relic of the post-war Bretton Woods agree-
ment is a tool that has “lain dormant for half a century.”
In effect, SDRs create a super global currency to help relieve the
financial crisis. But wait a minute; don’t we already have a super
global currency? Well since the end of World War II at least, we did.
It was called the U.S. dollar. Before that, it was the British pound.
And as long as the dollar keeps its official designation as the world’s
key reserve currency, it technically is the global currency of choice
for international settlements. In fact, despite the dollar’s rapid de-
cline, 64.5 percent of international settlements are still transacted
in dollars.
However, SDRs are a serious challenge to the status quo because
they decrease global investment in U.S. dollars. This is not a ho-
hum financial detail. It could be catastrophic for the nation’s econ-
omy if the dollar loses its special status. The modern U.S. economy
relies on foreign investment to provide the cash necessary to run
the financial and service sectors where most Americans earn their
living. The last 38 years of deindustrialization made running the
economy on foreign debt business as usual for the United States.
The next four decades will require something entirely different that
probably won’t involve our precious “dead presidents.”
China has been pushing hard for SDRs to assist it in dealing with
its “dollar glut” created by the massive imbalance in foreign trade.
That means it would no longer be obliged to reinvest these excess
dollars back into the U.S. economy. I know many people have the
2 n d I ss u e 2 0 0 9
misconception that China has accrued most of America’s wealth.
The reality is that it is addicted to our currency to keep its own
economy from collapsing, and it does hold most of our foreign debt,
which may never be repaid.
Remember, China created an enormous monster it needs to feed
with a currency much stronger than its own. If dollar dope won’t
cut it anymore, China will turn to the financial pushers in Europe
willing to service its habit. If this sounds like the 18th Century opi-
um trade reemerging in another form, you’re not far off.
And don’t forget, this is the same monster that produces just about
everything we use while Chinese workers earn less than a dollar
an hour in our money for their efforts. In some ways, the Asian
economies are worse off than we are. But the imbalances are more
to blame than policies of any particular nation state that is trying to
cope with the situation.
Could SDRs signal the demise of the U.S. dollar? This of course
depends on how and to what extent they are used. However, it is
generally agreed the dollar can’t retain its value if foreign investment
flees on a large scale. And the Achilles Heel of foreign investment is
debt. That’s why the ability of central bankers and the US Treasury
to deliver bailouts to deal with the financial crisis won’t address the
underlying reasons why the financial system continues to collapse.
The world’s nations cannot go on indefinitely investing in a cur-
rency so heavily laden with debt that it is no longer a sound invest-
ment by any practical economic standard. The paradigm is shifting
because it must. But what form will the new global economy take?
Read the column: “The Empire With the Invisible Throne” (page
16) for a deeper perspective.”n
David Whitehead is the Publisher of Business Insider Magazine. He
can be reached by email at Publisher@BusinessInsider.us.
S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e 1 9
I N CO R P O R AT I O N I N S I D E R
To Incorporate or Not to Incorporate?
Protect Yourself and Your Business
By Selecting the Right “Entity”
By DeAnn Flores Chase, Attorney at Law
I
f you are thinking about starting a busi-
ness, no doubt you have pondered the
question, “Do I need to form a business
entity?” The answer is a resounding, “Yes!”
Unfortunately, we live in a very litigious
society. Statistics tell us that an estimated
50,000 lawsuits are filed daily in the U.S.,
with nearly 1.4 million filed in the State of
California annually. You should take steps to protect your wealth
before you ever get served with a lawsuit against your business. A
business entity provides personal liability protection from the debts
and obligations of the business because it has its own legal identity
separate and apart from its officers, directors, shareholders, manag-
ers or members – even if the entity consists of only one person. If
you are sued based upon an occurrence arising during your business
operations, a properly formed and maintained business entity can
limit exposure to a judgment solely to the assets of the business--
and not your family.
It is imperative to form a business entity before you sign a lease,
contract, franchise agreement, or otherwise start to do business.
Once the entity is properly formed, every agreement must be signed
in the name of your business entity. Forming a business entity be-
fore you start conducting business can not only provide personal
liability protection, but can also allow your entity to develop cor-
porate credit.
Many business owners defer the formation of a business entity
until after they have done business for some time. By that time,
however, they have incurred start-up costs and debt that will unfor-
tunately be reflected on the individual owner’s personal credit. At
that point, it is not possible to simply “roll over” the individual debt
to a “limited liability” company. And it is quite difficult to unravel
the business assets and obligations from the personal ones. Waiting
to form the entity until after you have been in business for a year or
more means that you must in essence “start over” when forming the
entity at a later point.
Now that we’ve established that it’s best to protect your personal
and family assets and build credit, the next step is to determine
which type of business entity is right for you. Whether you are go-
ing it alone or with another person, the choice of a proper business
entity should be made in close consultation with a business law at-
20 S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e
torney and your tax advisor. Business entities include:
General Corporation (“C-Corp” or “S-Corp”): If properly
formed and maintained, a corporation provides protection from
personal liability for the debts and obligations of the corporation
for its officers, directors and shareholders.
“C” Corporation: A traditional “C” corporation involves the is-
sue of “double taxation.” The corporation is taxed on its income at
the corporate level, and its shareholders are taxed on distributions
of income in the form of dividends on their personal income tax.
In order to maintain a corporation, corporate formalities must be
maintained, such as annual meetings and the keeping of minutes.
A “C” corporation has some tax benefits, such as deductibility of
health insurance premiums.
“S” Corporation: A corporation that has made an election to be an
“S” corporation for federal income tax purposes is treated as a sole
proprietor or partnership for tax purposes, known as “pass through”
taxation; thereby, avoiding “double taxation.” “S” corporations have
many limitations in their structure, such as limits on the number of
shareholders, citizenship requirements for shareholders, and issu-
ance of only one class of stock.
Limited Liability Company (LLC): As with a corporation, a lim-
ited liability company (LLC) provides personal liability protection
for the debts and obligations of the business. LLCs also have “pass
through” taxation where the income and losses pass through to the
individual members’ tax returns. An LLC may elect to be taxed as
a corporation. It can be managed by all of the members or can have
centralized management in one or more of the members, known as
“managers.” If properly formed, an LLC does not need to maintain
corporate formalities, such as holding meetings and keeping min-
utes.
In California, an LLC may not render professional services, which
include services lawfully rendered only pursuant to a license, certi-
fication or registration under the Business and Professions Code,
the Chiropractic Act, the Osteopathic Act or the Yacht and Ship
Brokers Act. However, the California Attorney General has opined
that such services do not include services rendered pursuant to a
nonprofessional occupational license under the Business and Pro-
2 n d I ss u e 2 0 0 9
fessions Code. Notably, neither the Contractor’s State Licensing mation, but proper maintenance to provide the personal liability
Board nor the Department of Real Estate will issue a corporate protection provided by law. Failure to do so will allow a creditor to
license to an LLC. “pierce” the veil of liability protection in order to collect against the
personal assets of the individual owners of the entity.
Professional Corporation: A professional corporation is ap- In recent years, many companies have come into the marketplace
propriate for medical and therapeutic practices, accounting and telling you that you do not need a lawyer to form a business entity,
finance, and legal professions. The requirements for professional make a contract, or get a trademark. But the truth of the matter is
corporations vary according to the governing body regulating the that the money you “save” by doing it yourself can cost you thou-
practice of a particular profession. Some professions require cor- sands more dollars in the future. Why take the risk?n
porate registration with the governing body; others do not. Many DeAnn Flores Chase has spent the last 12 years counseling and de-
professional corporations are limited with respect to who can be of- fending individuals and businesses of all sizes. She has successfully de-
ficers, directors or shareholders in the corporation. Careful analysis fended her business clients against a broad range of claims, including
is necessary to ensure that a professional corporation complies with contract and lease disputes, trademark and copyright infringement, and
the requirements for its particular profession. catastrophic injury and wrongful death claims. Ms. Chase’s focus on
And now a word or two about DBAs. DBA stands for “Do- liability protection comes from the successful handling of all aspects of
ing Business As.” A DBA is formed by filing a Fictitious Business litigation for individuals and businesses of all sizes. To obtain a FREE
Name (FBN) statement with your clerk in the county (or counties) copy of Ms. Chase’s report on “The Four Common Mistakes Business
where business transactions will occur. A DBA is not a business Owners Make,” visit her website www.sbblmb.com and enter the promo
entity, and provides absolutely no personal liability protection for code, “BIM.” DeAnn Flores Chase A Law Corporation – South Bay
the individual or individuals conducting business. After a business Business Lawyers 310-546-8111. Email: deann@dfclawcorpcom.
entity is formed, it may be appropriate to file an FBN for the en-
tity if it is anticipated that the business entity will transact business
under a fictitious name that differs from the name reflected on its
A business entity provides
registration documents.
What else is NOT a business entity?
personal liability protection
Sole Proprietorship: A sole proprietorship is one person alone.
He or she will have unlimited liability for all debts of the business,
and the income or loss from the business will be reported on his from the debts and obligations
or her personal income tax return along with all other income and
expense he or she normally reports. A sole proprietor often does
business under a fictitious business name as a “DBA.”
of the business because it has its
General Partnership: In a general partnership, each of the two
or more partners will have unlimited liability for the debts of the
business. The income and expense is reported on a separate return own legal identity separate and
for tax purposes, but each partner then reports his or her pro rata
share of the profit or loss from the business as one line on his or her
personal tax return. apart from its officers, directors,
Limited Partnership: With a limited partnership, each of the
general partners has unlimited liability for the debts of the partner-
ship, but the limited partner’s exposure to the debts of the partner-
shareholders, managers or
ship is limited to the contribution each has made to the partnership.
However, a limited partner may be deemed a general partner if it
determined that he or she actively participated in the management members – even if the entity
of the entity; and therefore, he or she may then have the same un-
limited liability for the debts of the partnership.
Ultimately, liability protection depends not only upon proper for- consists of only one person.
2 n d I ss u e 2 0 0 9 S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e 2 1
CALENDAR OF BUSINESS EVENTS
Save The Date!
Manhattan Beach Chamber of Commerce
For more information about the events listed, call 310-
545-5313 or go to www.ManhattanBeachChamber.net.
Mixers:
Wednesday, July 15, 2009
14th Annual Joint Manhattan Beach, Redondo Beach
and El Segundo Mixer in the Park
Chevron Employees Park 5:30-7:00 p.m., El Segundo
Blvd. just west of Sepulveda.
Admission $5 Non-Members
Palos Verdes Peninsula Chamber of Commerce
For more information about the events listed, call 310-
377-8111 or go to www.PalosVerdesChamber.com
Breakfast Mixer:
All Breakfast Mixers take place 7:15-9 a.m. on the first
Wednesday of the month. Cost: $15 if RSVP is made;
$18 without an RSVP or for guests. Full breakfast is
served.
Wednesday, August 5, 2009
Belmont Village
5701 Crestridge Road, Rancho Palos Verdes.
Redondo Beach Chamber of Commerce and Visitors
Bureau
For more information about the events listed, call 310-
376-6911 or go to www.RedondoChamber.org
Mixers:
All mixers are held 5:30-7:30 p.m. on the dates listed.
22 S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e
Admission is $5 for chamber members or $10 for
guests (includes 1 drink ticket).
Wednesday, August 26, 2009
Redondo Beach Chamber of Commerce Regional
Mixer
Seaside Lagoon
200 Portofino Way, Redondo Beach.
Network Café
Enjoy a great lunch and learn about Redondo Beach
Chamber members and their businesses while promoting
your own. Each person will get to present a 30-second
commercial in front of the whole group. Advanced
reservations are required and will save you $5. Members
with reservations are $20 and guests and members without
a reservation are $25. Network Café is held 11:30 a.m.-
1:30 p.m. on the dates listed.
Thursday, September 10, 2009
Network Café - Ruby’s Diner
245 Harbor Dr., Redondo Beach.
Thursday, July 09, 2009
Buca di Beppo
1670 S. Pacific Coast Hwy., Redondo Beach.
Local Professionals Invited to Networking Meeting
Local business professionals are invited to a meeting for
a local chapter of Leads Club, a national networking
organization. The luncheon meetings are held every
Tuesday from noon to 1:30 p.m. in the Riviera
Village, Redondo Beach. To learn more, visit: www.
rivieraleadsclub.com. For reservations call: Carlene
Delight: 310 259-0488 or Jerry Bottomley: 310 890-
8195.n
2 n d I ss u e 2 0 0 9
 Introduce Your Company to Thousands
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2 n d I ss u e 2 0 0 9 S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e 2 3
PUBLISHER’S PERSPECTIVE
Continued from page 17
tiny. However, globalization advocates care more about the destiny
of the global economy than the national interests of any particular
nation state. This is important to note because whether it happens
after the current stimulus strategy burns out or a few years from
now—depending how long it takes for the system to completely
fail—expect people in high places to propose an internationally
controlled central banking system, ostensibly to restore stability.
For the United States, that will probably mean something like the
proposed North American Union, but they could try to disguise
this by linking existing central banks and letting individual nations
keep their currencies, at least in name.
This is inevitable because most nations of this world issue cur-
rency from privately-owned for-profit central banks based on the
1694 Bank of England model, which, operating as separate entities,
are designed to provide a money supply for self-sufficient nation
states—not the interdependent unions of nations we have become.
The U.S Federal Reserve is actually a privately-owned bank that
lends money to the government at interest. It has little or no ac-
countability to anyone except its own private investors who transact
most of their business secretly away from public scrutiny. Imagine
an internationalized central bank empowered to do the same thing
for the entire world. The potential for abuse would be enormous,
and if we find ourselves under its heels, there would be no way to
escape it.
We can’t go on forever allowing deficits to mount exponentially,
creating boom/bust economic cycles that have grown so ferocious
they are now tearing the nations of this world apart. “The [central]
bankers are on the run, feverishly trying to use the collapse of the
current system to steer us toward an ‘Amero’-style North American
currency, or a one-world private banking system and privately-is-
sued global currency that they and only they control,” Ellen Brown,
J.D., author of the book Web of Debt, recently stated in a letter to
President Barak Obama calling for a return to Lincoln’s monetary
policy of issuing currency interest-free from a U.S. Treasury that is
not controlled by Wall Street. “We the people will not accept those
solutions, however, no matter how bad things get. We demand real
solutions that empower us, not further enslave us.”
I would expect further internationalization of the central banking
system to be laid out as the only possible solution in the midst of an
enormous crisis while anyone bold enough to stand up for the au-
We don’t want central banks issuing currency for profit any more than we
want the military starting wars for profit. Fiat Money is an
instrument of law, and we get on dicey ground when we empower a
privately-owned institution to originate law from which it profits.
24 S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e
tonomy of their nation will be ridiculed and discredited. But don’t
believe there are no viable options available and don’t let the media
spin (which I expect to be brilliant wordplay at its finest) shut you
down from analyzing this. There is simply too much at stake to let
our initial fears dull our sensibilities to the that point we passively
hand our country over to the global financial system and whoever it
is that actually runs it.
Allowing globalism to flourish unchecked is not free market capi-
talism. This is what the late Georgetown University historian Car-
roll Quigley described as “monopoly capitalism.” The 1890 Sher-
man Antitrust Act, which has been curiously marginalized in re-
cent years, was implemented to prevent this sort of thing so markets
remain truly free for diverse entrepreneurial activity. It’s ironic to
note that monopoly capitalism has more in common with commu-
nism than genuine free market capitalism. In fact, laissez faire capi-
talists abhor free markets for all but themselves. If you study the
history of global financial power, it reveals the most elite among the
world’s financiers don’t care whether capital is concentrated publicly
or privately so long as it is in a position where they can control it.
“Permit me to issue and control the money of the nation and I care
not who makes its laws,” is a frequently referred to quote made in
the 18th Century by M.A. Rothschild, founder of the famous Euro-
pean banking dynasty.
Politics and Money
In the left/right political debate, we waste a great deal of time
arguing about matters of functional irrelevance while the “hidden
hand” is content to pick our pockets from either side. World Bank
Group President Robert Zoellick recently stated in a speech he
gave addressing the global financial crisis before the recent G-20
summit in London that major international banking institutions
need more power to monitor national policies. “If leaders are se-
rious about creating new global responsibilities or governance, let
them start by modernizing multilateralism to empower the World
Trade Organization, the IMF, and the World Bank Group to moni-
tor national policies,” Zoellick said. “Bringing sunlight to national
decision-making would contribute to transparency, accountability,
and consistency across national policies.”
I’m all for transparency, but here’s the problem I have with this
statement, which mirrors countless statements echoed relentlessly
in the international financial community: It is impossible to cre-
2 n d I ss u e 2 0 0 9
ate meaningful “global governance” without
marginalizing national sovereignty in the Continued from page 11
stated areas of jurisdiction. And what area torney will spend one or two hours preparing for every hour actually in the court-
of jurisdiction is more important to nation- room. This includes writing briefs and evidence motions, preparing exhibits, and
al sovereignty than domestic banking and reviewing testimony and discovery.
monetary policy? The United Nations in Trial usually begins with a conference with the judge over procedural details.
its current form is “global government lite” Next are arguments on “motions in limine” – these are vital, as they determine what
compared to what Zoellick just described. evidence the jury can and cannot see. Sometimes the case is won or lost on these
What Zoellick calls for is global govern- motions.
ment jurisdictions centered on banking Jury selection is next. The judge and both attorneys question the potential jurors
and monetary policy with real authorita- and try to strike from the panel those they feel will be unfavorable. Once a jury
tive power. In this world, whoever controls (usually of 12) is selected, the lawyers give their opening arguments, plaintiff first.
money ultimately controls everything else. The plaintiff must prove his claims “by a preponderance of the evidence” by show-
ing that his claims are more likely than not true. The plaintiff puts witnesses up
That’s why these folks don’t need to micro-
first, and the defense then gets to cross-examine them. When the plaintiff “rests,”
manage everything to influence the outcome
the defendant presents his case. After the defense “rests,” the plaintiff gets a short
of just about every decision we make. They
chance to put on rebuttal evidence.
know this well and they rely on the fact The lawyers then argue the case to the jury, and then the jury deliberates. The
most of us are unaware of their agenda and court will “instruct” the jury--that is, read largely pre-written explanations of the
tactics. The only way for citizens at large to key issues of law applicable to the case. The jury’s verdict requires a 9-3 or better
protect themselves and their nations from vote on each issue.
this closely guarded insider power is to The winning party will then have a judgment in her favor. Note that having a judg-
keep their nations sovereign and to make ment against someone is not the same as collecting a judgment from someone. If the
their governments truly accountable to the judgment debtor has no assets, there is nothing to collect. If the judgment is against
people—something they have not been for
Continued on page 29
a very long time.
It’s as crucial for governments operating
Business litigation is a long, complex process that
by the consent of the people to keep their
monetary system under their control just takes considerable time and money. The key is to
as they would control the military. We
don’t want central banks issuing currency think about your business goals and resources at
for profit any more than we want the mili-
tary starting wars for profit. Fiat money is every step in the process, and to work with a legal
an instrument of law, and we get on dicey
ground when we empower a privately- professional who understands your needs.
owned institution to originate law from
which it profits.
This means the agency entrusted to issue
currency should be a genuine government
agency and no secondary layers of interest
or debt should be tied to the money supply
itself. This would ultimately be better for
honest chartered banks, the business com-
munity and citizens at large. And if we do
this, the rest of the world will stop rolling
their eyes when we espouse our republican
values with each imperial directive. n
David Whitehead is the Publisher of Busi-
ness Insider Magazine. He can be reached by
email at Publisher@BusinessInsider.us.

2 n d I ss u e 2 0 0 9 S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e 2 5
G R E E N B I Z COV E R F E AT U R E

“South Bay businesses and residents are encouraged to learn about

water conservation programs, both indoor and smart landscaping
outdoors.”
Marilyn Lyon, SBESC Program Manager

Continued from page 15
workday is over, it is continually in the process of reviewing any and
all potential eco-friendly changes. Besides judging the environmen-
tal benefits of a given decision, short- and long-term cost-effective-
ness must also balance out the equation.
Kalapura detailed a list of Manhattan Beach’s key green accom-
plishments and programs, which include permit fee waivers for so-
lar panel installation, purchase of hybrid cars for public safety and a
CNG Dial-a-Ride vehicle, installation of drought tolerant planters
along downtown as well as recycling containers along the Strand
and city parks, green workshops for seniors, and an extensive en-
ergy audit and water rate study.
New programs include battery recycling, unwanted medication
drop-off, and Sharps (needles, syringes, lancets, etc.) material dis-
posal. The City also holds a number of green events during the year,
most recently a Reusable Bag Day, Solar Homes Tour, and Earth
Day celebration.
Meanwhile, a dedicated “Going Green” page on the City’s website
updates citizens about ongoing and upcoming environmental pro-
grams, events and initiatives.
Outreach is a vital aspect of Kalapura’s job. In addition to over-
seeing the CAP, Kalapura also serves as a point person for public
education on green issues and liaison to the Environmental Task
Force. “It was important for the Council to involve the community
to make Manhattan Beach the greenest city it could be,” she said.
“The backgrounds and expertise of the people on the Task Force are
very impressive, so we’re very glad to tap into our local talent pool.”
The task force holds public meetings on a monthly basis and
makes recommendations to the Council on areas dealing with car-
bon emissions reductions, solid waste and recycling, green building
and water conservation.
“It’s a great opportunity for the City to look at what policies to
implement to help the environment, and what we can do in the
future” Kalapura said. “The programs span across all departments
of the City, including public works, parks and recreation and com-
munity development. There’s much to be done, but everyone is very
knowledgeable and committed to making it happen.”
South Bay Environmental Service Center:
The One-Stop Shop for Eco Info
While individual cities and businesses have taken it upon them-
selves to carry out their own green initiatives, others need a little
direction. Thankfully, help is out there. Describing itself as the
“South Bay’s local clearinghouse for energy efficiency, water con-
servation and environmental information,” the South Bay Environ-
mental Services Center (SBESC) assists public agencies (including
cities and school districts), businesses, commercial property owners
and residents of all ages in the quest to go green. According to its
mission statement, SBESC exists to “significantly increase the avail-
ability of information and resources to the people in the South Bay
region to help them save water, energy, money and environment.”
Through partnerships with the South Bay Cities Council of
Governments, The Gas Company, Southern California Edison,
West Basin Municipal Water District, the City of Torrance , and

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838 Manhattan Beach Blvd., Manhattan Beach 310.376.9464
The First Green Real Estate Office with the Official Designation, always striving to
make a difference in our community, our country, our world. Helping families find
homes and going green makes sense. We work for you and our environment. When
you work with us, we can make a difference together.

Come See our FIRST OF ITS KIND in Manhattan Beach, “Live Green Roof ”
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Sheila Ennis • Marlene Ellwood • George Navarro • Charles Weaver 310.545.5603

26 S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e 2 n d I ss u e 2 0 0 9
 Graduate Courses

the Sanitation
Districts of Los www.webster.edu/laafb
Angeles County Need to retrain or finish a 4-year degree? Check out our undergraduate programs.
, SBESC spon-
sors ongoing Webster University—Los Angeles Air Force Base
free workshops, Phone: 310-607-8005
seminars and 483 N. Aviation Blvd., Bldg. 272, RM C2302, El Segundo, CA 90245-1256
outreach speak- reaL-KNoWLedGe For reaL-WorLd suCCess®
ing
agents eventsme if I had anything to
asking
geared to resi- was so
sell since there much Lyon
Marilyn demand
dents and busi-
ness owners to help them establish “best-
green practices.” The agency also provides-
When the Economy Gets Tough
a wealth of valuable information (both on--
line and
ural at its Lawndale-based
waterfalls, ponds, and offices)
high-end on
Your Legal Problems Get Tougher
everything from utility rebate
irrigation systems that have become incentives
and refrigerator recycling to green build- During difficult economic times, people often turn
ing and solar technology.
Fortunately for Garcia, Through
he had SBESC,
built to the legal system to make up for revenue shortfalls...
you can get water conservation tips as well-
as a list
tele thatof would
various “no-cost
help him things”
stayyou can
afloat ...That means risk to your business increases
do right now to save energy
between the down years of 1990-92. and money. if your legal house is not in order.
Solar
“In is the
’90, just Iron
one example
Curtainoffell a more
and effi-
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cient power source promoted by SBESC.-
Information about biomass, wind, hydro,- SCHLICHTER & SHONACK, LLP
and geothermal
sands began to applications
lose their jobs is readily
and To u g h a n d E x pe r i e n c e d B u s i n e s s A t to r n e y s
available on the agency’ s website.
property values dropped. A big black  Aggressively defend frivolous lawsuits.
Meanwhile, SBESC’s Energy Efficient-
 Ensure your contracts protect you from unnecessary lawsuits.
Plus (EE+) program helps businesses
 Find out if you chose the most advantageous business structure.
and agencies save energy by joint procure--
 Make sure your partnership arrangements don’t lead to unnecessary disputes.
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 Know your rights as a creditor and as a debtor.
as refrigerated
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Other  If a legal problem does occur, let us handle it professionally and effectively.
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Clients include Fortune 500 companies, businesses of all sizes and startup entrepreneurs.
Continued
Continued ononpage
page 28
28

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2 n d I ss u e 2 0 0 9 S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e 2 7
G R E E N B I Z COV E R F E AT U R E

“We look for the best way to educate employees on green issues and how to
change their behavior at work ... Our goal is to educate them about going
green so they in turn spread the message to their friends, family and people
in the community to do the same.”
Heather Ramirez, Tech Go Green, Director of Development
Continued from page 27 them through the entire process and help always mean big investments. Many green
them implement programs and policies by solutions are simply creative everyday alter-
landscaping outdoors,” said SBESC Pro-
gram Manager Marilyn Lyon. talking to local distributors and contrac- natives.
On its online calendar at www.sbesc.com, tors.” To take their work to the next level, Tech
SBESC lists virtually every eco event hap- The evaluations are meant to leave no Go Green is now developing a Torrance
pening in the South Bay on a monthly ba- stone unturned. For instance, an evalua- Green Business Program to provide busi-
sis. tion of Switzer Learning Center revealed nesses with the necessary technical assis-
that employees didn’t reset the thermostat tance to become a “Certified Green Busi-
Torrance Firm Helps Businesses after leaving the office. “They would adjust ness.” To achieve certification, businesses
Go Green and the temperature to too hot or too cold but must comply with regulations and adopt
Save Green didn’t change it back before they left,” ex- environmentally sound practices in energy
A relatively plained Ramirez. “So we recommended efficiency, water conservation, solid and
new Torrance- installing lock boxes.” Going green doesn’t hazardous waste reduction, and pollution
based firm of-
fers “sustainable
business con-
sulting” to help
small businesses
go green and
save money in
Heather Ramirez the process. In-
corporated early last year, Tech Go Green
sends field experts to offices to conduct
energy audits, utility bill analyses, end-user
surveys, and management interviews.
The program aims to reduce a business’s
carbon footprint, waste generation, and wa-
ter and power usage while also encourag-
ing recycling, energy-efficiency and use of
post-consumer content.
Tech Go Green’s staff members are
trained in energy management practices
LO S A NGE LE S | SOU T H B AY | OR ANGE CO UNT Y | SA N FER NAN D O VALLE Y | I N L A N D E M P I R E
with college degrees in environmental sci-
ences as well as additional education from
Southern California Edison. “We try to be South Bay Regional Office
as comprehensive as possible,” said Tech Go Patti A. Vollmer, Regional Vice President
Green Director of Development Heather Brian Ishida, V.P. | Tom Buescher, V.P.
Ramirez, who said the on-site evaluations 310.808.1200
typically take a week from start to finish.
“When we’re done with the walk-through,
we give them a proposal that describes A MERICAN B USINESS B ANK
how sustainable they are and how they can Member FDIC
become more sustainable. We hand-hold

28 S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e 2 n d I ss u e 2 0 0 9
prevention. The program will eventually expand to the entire South
Bay.
While most environmental consulting can be pricey, Tech Go
Green has managed to get around that obstacle. “We filed for non-
profit status so that the small businesses we work with wouldn’t
be hampered by consulting fees,” she said. “This allows us to secure
outside funding to cover those fees and allows businesses to spend
more money actually implementing our recommendations.” Such
recommendations are not only meant to be eco-friendly, but also
help the bottom line. “It’s a win-win situation for the business and
the environment,” Ramirez added.
While Tech Go Green’s business analysis identifies every possible
and even obscure energy-wasting behavior, one high-profile area is
Continued from page 
Although constructed from rigid plastic and glass, the lightweight
Amazon Kindle is the first device to reach consumers that uses elec-
trophoretic technology. Originally launched in November 2007, this
first-generation advanced electronic reader makes an extraordinary
leap in functionality. It can download from a selection of 230,000
book titles, purchased for $9.99 each and delivered through existing
wireless networks. The cost savings alone on book purchases offsets
the $359 price tag for the device. Plus, Amazon.com provides wire-
less access with the purchase of the device. The system backs up all
user downloads in case a device is lost or another one is purchased.
If you want to use it to read your own documents, you can email
your .pdf or Word files to the device and go to it.
As with all first-generation technologies, the Amazon Kindle and
its few competitors have notable limitations. Electrophoretic dis-
play screens are only available in black and white and the Amazon
Kindle has a screen about the size of a paperback book.
Despite its limitations, major newspapers, magazines and even
Continued from page 25
you, again consider settling. An amount less than the judgment
plus a waiver of an appeal might just resolve the case.
Step Seven: Appeal
You can appeal an unfavorable judgment, but about 80 percent of
appeals fail. That is not surprising, since appeals do not test the facts
found by the juries, but rather the judge’s legal rulings. Things like
the improper introduction of evidence or the incorrect application
of law are typical appellate issues. What the court of appeals will
not look at are facts – the court of appeal will almost never override
a jury’s finding of fact. For that reason, and because it is extremely
expensive, you should carefully consider whether to appeal.
Business litigation is a long, complex process that takes consid-
erable time and money. The key is to think about your business
2 n d I ss u e 2 0 0 9
the biggest offender: lighting. “You don’t need a consultant to tell
you your lighting isn’t energy-efficient,” said Ramirez. “But lighting
alone can save thousands of dollars. Also, bathroom fixtures and
toilets can make a huge difference.” Ramirez added that changing
employee mindsets is also critical. “We look for the best way to edu-
cate employees on green issues and how to change their behavior
at work,” she said. “Turning on a screensaver doesn’t reduce energy
consumption, for example. On the other hand, even if you install
energy-efficient lighting, it defeats the purpose if you leave it on at
night. Our goal is to educate them about going green so they in turn
spread the message to their friends, family and people in the com-
munity to do the same.”n
Brian Simon is a freelance writer who lives in El Segundo.
blogs are already providing content available for download. The
periodical market is set to explode when future generations of ad-
vanced screen technology offer full-size page display in color. How-
ever, we will still be reliant on LCD technology to stream moving
pictures and video for the foreseeable future. But the road ahead is
paved and the horizon is becoming clear.
Sony has a competing product and iRex, a Dutch firm, launched
a product last year. As new products are innovated and industry
standards are set, it’s only logical that much of the paper we produce
now will no longer be wanted or needed.
But the demand to read will always be there and whatever form
we ultimately use to deliver it, rest assured the publishers you have
always known will be here to serve you. Most of them must need to
break their pulp addiction. Perhaps the green revolution will knock
some sense into them.n
David Whitehead is the Publisher of Business Insider Magazine. He
can be reached by email at Publisher@Businessinsider.us.
goals and resources at every step in the process and to work with
a legal professional who understands your needs. So if you should
be handed papers, stop and take a deep breath. You are in for a
fight, but you will improve your chances and minimize your losses
if you understand what you are up against and approach it not as an
emotional issue, but as a business problem to be solved as efficiently
as possible. n
Kurt Andrew Schlichter is a business litigator and a partner at Schli-
chter & Shonack, LLP, in Manhattan Beach, a six-attorney law firm
primarily focusing on the representation of businesses and businesspeo-
ple ranging from Fortune 500 companies to individual entrepreneurs.
He writes frequently on legal issues. This article does not constitute legal
advice and does not establish an attorney-client relationship. Consult
an attorney regarding your individual situation.
S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e 2 9
 TECHNOLOGY INSIDER

Continued from page 30 been avoided. Individuals also made fre- ment. Bad feelings and finger pointing
quent mistakes because they didn’t have the result when these kinds of problems lead
prehensive IT system to be devised for the to horrible mistakes or create a productiv-
various departments that needed to keep right information when they needed it.
ity gridlock. And when the economy gets
and share much of the same information. I realize that during a booming econo-
bad, you simply can’t afford to put up with
The result was a disillusioned staff that got my, companies get too preoccupied with it any longer. But the Catch 22 is that by
buried in muck, not to mention enormous their core business to notice the monsters this time, you may not be able to afford to
expense to the company that could have they often create with their IT manage- do anything about it. It’s cheaper and easier
mpany to build and maintain a system correctly on
and the front end than it is to fix a badly con-
nor-
to
ALPHA COMPUTER SUPPORT, INC. ceived one. I remember how difficult it was
to
Our business is to keep you in business. to consolidate two ACT databases from
different departments. When our IT pro
little
anies, Consulting and Service for Businesses finally did it, we still had duplicate entries
• Experts in all phases of networking and server support. all over the place that couldn’t be fixed with
pro- an automated procedure.
ound. • Experienced with all Microsoft Windows operating systems.
their Avoiding Gridlock and Problems
to
oice I Call Now ! (310) 801-9026 The best way to avoid these kinds of
problems is to implement integrated IT
phone
from the start. Evaluate and select software
keep We understand the value of keeping an eye on the bottom line!
solutions that serve the broadest range of
your IT needs. If similar information is
shared between accounting, sales and other
administrative staff, make sure you are not
creating redundancies and ensure that spe-
Design Group cific individuals only have access to infor-
mation related to their jobs that they are

SLIDE Quality ad designs authorized to see. Most importantly, make

sure the entire integrated system is secure
affordable for any company
AREA
from the outside.
I always had the impression that tech-
or organization. resistant managers were afraid sensitive
information would get into the hands of
the wrong people if they integrated their
systems. Ironically, there is actually a
greater risk when the system is screwed up.
The best way to handle the situation is to
hire IT experts with in-depth experience
at creating the kind of secure system you
need—an industry specialist if possible. If
you believe your company will grow to a
Magazine-quality display ads • substantial size, you’ll probably need either
a custom system or high-end software that
Brochures and flyers •
is easily customized to your specific needs.
Newsletters • It’s definitely worth the investment.
Be careful how you put together a man-
Publication consulting • agement team to make vendor and product
selections. Remember that it is natural for
Call (310) 872-9732 for a FREE quote . Website: www. businessinsider.us/slide-area-design managers to feel territorial about their own
Slide Area Design Group is a division of Business Insider Magazine departments. This often leads them to fo-
cus on areas of the company they feel are

30 S o u t h B a y B u s i n e ss I n s i d e r M a g a z i n e 2 n d I ss u e 2 0 0 9

important rather than on the company as a
whole. The whole idea of integrated IT is to
make the entire operation work in unison.
Don’t let company politics sabotage this
process, leaving you with an unbalanced or
fragmented system.
Whatever you decide on, don’t expect ev-
eryone to be happy with everything about
it. You will need to make some compro-
mises of course, and you will need a system
that can grow with the changing demands
of your company.
Although smart IT people know how to
effectively program your system, they don’t
know your company as well as you do. Pay
attention to how they create user interfaces
for your staff while taking an interest in the
way they create database fields and how
those are displayed.
Much of the information will be accessed
behind the scenes in a consolidated relation-
al database. However, make sure your staff
gets a presentation they will understand as
easily as the people who create the system.
Think ahead to the information they will
need on a regular basis. This comes first.
While keeping like information together,
make sure staff can access any information
they conceivably might need without hav-
ing to disrupt the work of others. Make
sure there are secure sign-ons for sensitive
information and ensure only people autho-
rized to change the information in specific
fields are able to do so.
What you want to avoid is forcing people
to search for things, which is one of the big-
gest productivity killers in the 21st Century
workplace. Also, you want your employees
to feel they are accomplishing something
rather than jumping through the same
hoops over and over again. The structure of
your company’s IT system is a morale issue
as much as a technology issue. Creating an
integrated IT system from the get-go will
save yourself a load of time, money and ag-
gravation as well. And it may be the key to
your survival during a down economy. n
David Whitehead is the publisher of Busi-
ness Insider Magazine. He can be reached by
email at www.BusinessInsider.us.
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