So You Don't Believe in Big Al

January 17th, 2012 - Posted by Big Al

Now that the holidays have passed, I'd like to discuss something that's sticking in my craw. Seems there's a fair number of you who do not believe I exist. Like my red-suited friend, who shall remain nameless, but who tends to be discussed each year towards the end of December, I find myself the subject of much speculation and doubt.

Well, let me state for the record, categorically, I do exist. Don't believe me? Just ask my able-bodied assistant, Roy, with whom you've probably spoken on occasion. Roy does a lot of my legwork. And in FY 2011 he sure has been busy.

My Assistant Roy

In 2011, for loans greater than $100,000 (I don't keep records for lesser amounts, they come out of petty cash) I loaned $3,130,693,401,283.84 . That's right, and 84 cents.

The biggest loan of FY 2011 was for $458,806,214,840. Now I know what you're thinking, gee, those guys accounted for one seventh of my business. Maybe I cut them a break, maybe I just charged 7.0%, or maybe even 6.25%. No way, they paid the full freight, the full 7.5%.

Plus they paid back every cent. And so did everyone else. Not one default in the house.

Last year, at 7.5% interest, I made $234,802,005,096. So it was a good year.
We had a heck of a holiday party. I even forgave
Roy for that time he left a briefcase full of cash
in a cab.

So here's some advice for 2012, and I hope you don't follow it, because I'm making out like a bandit.

• Encourage your students to cover their purchase of Plant and Equipment with the sale of stock or bonds.


• Make sure their forecasts are realistic, it's very unlikely that a company will take all the sales within a segment. Those unrealistic forecasts will make the proformas look great, but the results won't be.
  
  
• Tell your students to stop making products they can't sell. Sometimes participants just keep the lines running, making more and more product, building up inventory. If you see this happening, put on the brakes.
  Challenge them to justify their decisions. Either tell them to stop producing until the inventory sells or discontinue the product by selling off all its production capacity.

Speaking of inventory, if R&D redesigns a product, any inventory for that product on the day of revision is reworked to match the new specifications, free of charge. Who does this? Rumor has it it's done by elves. I'm not sure I believe that. I think I'll ask my red-suited friend, next time I see him.

Big Al is the Capsim lender of last resort. When Capsim companies run out of money, Big Al arrives, with a checkbook and a smile, to write a check that covers the shortfall - at above market interest, of course!