Be Leery Of The Small Business Stimulus
LA Times: “Today, too many entrepreneurs can’t access the capital to start, operate or grow their business. Too many dreams are being deferred or denied by a form letter canceling a line of credit,” Obama said after meeting at the White House with small-business owners and community bankers.
Under the new program, the Treasury Department would buy as much as $15 billion in loans made by banks and guaranteed by the Small Business Administration. Banks, which have been unable to sell such loans because of the credit crunch, could then turn around and make new loans.
The White House will use 730 million dollars in stimulus money to immediately cut small business lending fees, and raise loan guarantees up to 90 percent. They also plan to thaw the credit market by taking billions from the bank bailout package to buy many loans from community banks.
Works out to $500 per business.
My guess is it will cost $2-3,000 in time for a small business owner to get through the red tape.
The way they’ve been navigating the stimulus so far, most small business owners would be wise to skip this plan. I was told a long time ago that the best way to lose your business is to rely on government help.
The answer is to have the government get out of the way, drop taxes, and let business do it alone.
There are people out in the small business market that understand the challenge a lot more than the Obama administration… people like Janet Switzer who has a much better better small business stimulus – buy her book, or get her instant income plan.
Your business will be much better off.
March 17th, 2009 at 9:24 am
I see your point, but what can a small business owner do if the bank pulls the line of credit or calls in the loan and no other bank is out there lending, no matter how good the business and how faithful the payments? It’s the rare owner these days that is so cash-flush that s/he uses the banks solely for deposits and cheque-writing.