The Island's economy has been battered over the last few years. Local business owners in particular have been taking our lumps. All we seem to hear is doomsayers echoing that the sky is falling.Recently though, I've heard a handful of more optimistic murmurs. Maybe they're deluded…but I also am starting to take a few hesitant sips of the Kool-Aid. Heck, maybe a swig of the Kool-Aid is what we all need.In fact, if we step back, there really may be quite a hoard of silver in the lining of today's cloud.The looming cloudWe are struggling for liquidity. The ‘moisture' seems to have been sucked out of the local business environment and our mouths are parched. Where is the cash?Asset values, particular for real estate, have pulled back dramatically. Institutional lending has pulled back. Clients are taking longer to pay. More and more accounts receivable have to be written off. Some of our international business community has departed. Our customer base has reduced in size, matching the reduction of our working population. It all comes to this there is less money to go around for those of us who provide facilities for rent, consumer goods and professional services.Many of us are concerned. To be honest, many of us are frightened.The silver liningAcross the board, the initial response seems to have been instinctive. Batten down the hatches. Well the initial storm front has definitely washed over our shores. In the past months however, a few of us have poked our heads out to reassess the landscape. Things have changed.Recalibrated operating costs: The sky high costs of doing business, the difficulty with finding premises and the struggle to find employees have all been alleviated to some extent. Rents are reduced and there are spaces available. We get evidence of that just by walking through Hamilton and other commercial areas. Employee expenses have essentially been frozen. We have all read the headlines of the numbers of people seeking employment. They won't all be a fit for your business but some will. Suppliers are more inclined to provide favourable trading terms. Offer to pay your suppliers cash or on an accelerated basis and watch the smile beam across their faces.Private investment activity: Investors with liquid assets are particularly well positioned to profit. Companies are restructuring, shareholders exiting, others changing their capital structure and in all cases, cash is a welcome lubricant. In particular, I know of a number of local business owners with strong operating history and otherwise healthy businesses who are seeking to recapitalise their balance sheets. For strategic reasons, some of them are specifically looking for private investment as opposed to using the traditional financial institutions. The business owner benefits from the opportunity to focus his or her energies and bring on shareholders who can add value with intangibles such as access to customer networks, specific industry influence etc. Investors benefit from the opportunity to buy an equity stake in a sound business at a discounted price, without having to take on the responsibilities of day-to-day operations.Creative collaboration: We are starting to respond to the challenges through creative problem solving. Some of us are collaborating in joint ventures. Some of us are restructuring the way we do business sharing operating costs, integrating with complementary businesses to better service customers etc. Some of us are even bartering.We live on an isolated rock, hundreds of miles from our nearest neighbour. We import the majority of our food. We have no potable groundwater. Yet we have managed to not just survive but thrive. Our ability to adapt is what will bring Bermuda business through today's challenges.