Auto bailout No. 1 is done. I wonder how many more there will be? I would guess we’ll ultimately give them about $50 billion before we let them go under. But we haven’t seen anything yet when it comes to attempts to pump money into the economy. The new administration plans to inject at least a trillion in the form of a giant “make-work” program.
I think the proper business strategy for BHM right now is to begin planning for 15 to 25 percent inflation in a year or two. (How else can the economy absorb this big increase in the money supply?) I’m going to assume the $24.95 I now charge for a subscription to BHM will be worth about $20 to BHM in about a year. What do I do to offset that?
Paper and postage, my two biggest expenses, will also likely go up dramatically in a year or two but I can combat that with the launch of the e-issue, which doesn’t have those costs. I think the e-issue will dovetail nicely with the print issue, and I think many subscribers will want both. Right now I plan to charge $24.95 for either the print or e-issue, but $34.95 if you want both.
Although businesses in America are going into Depression with everyone else, there are good opportunities for a business such as BHM that has been run properly for years. We have no debt and we have a sound product, plus I have very smart, loyal people. I see no danger for us but I can foresee widespread carnage in the magazine industry as a whole.
Unlike most magazines, we are not dependent on advertising revenue as advertisers cut back on their spending. We could lose all our advertisers and remain healthy, but other mags would fold. Our money comes from paid subscriptions, and our subscriptions are increasing as the Depression deepens because of the nature and quality of our articles. I have always put content over advertising, and that philosophy has now put BHM in a very strong position as we enter both the internet age and a Depression. You’d almost think I planned it this way.
The next few years will be interesting. We are all now actors in a big economic drama that will be played out over the next year or two or three. I feel pretty comfortable, but I’ll be as vigilant as I’ve always been.