On Monday, the Obama administration, seeking to ease the credit freeze for small businesses, will inject $15 billion into the small business industry, buying up securities that are linked to small business loans.
President Obama said the investment was needed because “small business owners are really struggling” because their credit lines have been pulled.
“This is still just going to be a first step in what is going to be a continuing effort to make sure that people get credit out there,” Mr. Obama said in an appearance in the East Room of the White House.
By the end of March the Treasury Department will begin making direct purchases of securities backed by loans guaranteed by the Small Business Administration, and would purchase new securities. The credit freeze for small businesses have been having a crippling affect upon the economy.
Obama called this action as a “first step”.
Later, United States Senate Committee on Small Business and Entrepreneurship Chair Mary Landrieu, D-La., and Ranking Member Olympia J. Snowe, R-Maine, commented on President Barack Obama’s new plan to increase access to capital for small businesses. Chair Landrieu and Ranking Member Snowe joined Congressional lawmakers, business leaders and community bankers in a meeting with the President this morning to discuss the plan, which will take immediate steps to try to unlock frozen credit markets, temporarily roll back lending fees and bolster bank liquidity to ensure small firms can have continued access to credit.
Chair Landrieu said. “The financial crisis has hit small businesses where it hurts the most – drying up access to capital as banks are becoming more hesitant to lend. The frozen secondary market for SBA-backed 7(a) and 504 loans has discouraged new lending to small businesses, but the Obama Administration’s plan to purchase SBA-backed 7(a) and 504 loans will allow banks to leverage existing SBA loans to provide new loans to entrepreneurs looking to grow and create more jobs.
“By increasing the SBA loan guarantee to 90 percent and temporarily eliminating fees on 7(a) and 504 loans, President Obama’s plan will reduce the risk lenders face when they make new loans while making those loans more affordable to small business owners. I was proud to work with my colleagues on the Appropriations Committee to get these provisions included in the American Recovery and Reinvestment Act. By getting capital flowing again to small businesses, we will help get the country out of the economic crisis. Washington must focus on small businesses
“I am pleased that President Obama has called today’s summit to address the credit crisis that is preventing our nation’s small businesses from accessing the capital so vital to maintaining and expanding their operations,” said Senator Snowe. “Today’s implementation of critical provisions that Senator Landrieu and I fought to include in the American Reinvestment and Recovery Act to provide fee relief to borrowers and lenders in the SBA’s 7(a) and 504 loan programs, as well as an increased guarantee rate for 7(a) loans, comes not a moment too soon. The President’s willingness to use TARP funds to directly purchase SBA loan pools, which I have expressed my support for with the Administration, is a much-welcome step that will provide liquidity into secondary markets and generate additional financing dollars for small businesses nationwide.”
I don't know 'bout all dat Kp, right now I bust out laughing everytime I hear some new 'idea' about what is going to be done with the taxpayer's money.... And the funniest thing of all, taxpayer's are running around with their chests puffed up like what they have to say on anything really matters....... Now all of sudden 'everyone cares' about what is going on....... Ha-ha-ha-ha-ha!!!! The biggest chuckle of all I get out of this is the current AIG 'bonus' money.... And the congress and taxpayers actually think they 'own' AIG... What a laugh... What is there to own? Oh, I suppose there is a building, some office equipment, maybe a lear jet or two, and for how much? I guess somewhere's around 150 or 180 billion dollars...... What they bought was a bunch of debt, that's it, debt..... They spent 180 billion dollars on a hole in the ground and think they actually own something that they can hold in their hands..... Ha-ha-ha-ha-ha-ha-ha!!! Kind of reminds me of a Steely Dan song, which was among other songs I posted sometime back because I found conditions so amusing, and a couple of dumazzes took great mirth and merryment at ridiculing me because they were so pompous and all knowing and yet weren't even able to think about what was sitting in front of their faces... So Steely, I still dig your grooves, and I want to turn that heartbeat <inside joke>, over again......... thank you............ Your everlasting summer, you can see it fading fast... So you grab a piece of something that you think is gonna last...... You wouldn't know a diamond if you held it in your hand.......The things you think are precious I can't understand - - - <CHORUS>: Are you reelin' in the years???? Stowin' away the time - - -- Are you gatherin' up the tears????? Have you had enough of mine..... Are you reelin' in the years???? Stowin' away the time - - -- Are you gatherin' up the tears????? Have you had enough of mine..... - - - You been tellin' me you're a genius since you were seventeen . .. . In all the time I've known you I still don't know what you mean.. . .. The weekend at the college didn't turn out like you planned,,,,,, The things that pass for knowledge I can't understand.....<CHORUS>: Are you reelin' in the years???? Stowin' away the time - - -- Are you gatherin' up the tears????? Have you had enough of mine..... Are you reelin' in the years???? Stowin' away the time - - -- Are you gatherin' up the tears????? Have you had enough of mine..... - - - I spend a lot of money and I spent a lot of time....... The trip we made in Hollywood is etched upon my mind........ After all the things we've done and seen you find another man........ The things you think are useless I can't understand........ .....<CHORUS>: Are you reelin' in the years???? Stowin' away the time - - -- Are you gatherin' up the tears????? Have you had enough of mine..... Are you reelin' in the years???? Stowin' away the time - - -- Are you gatherin' up the tears????? Have you had enough of mine.....
Written by
on 3/18/2009
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"Injection of money" - just like Botox injections, one "injection of money" too many will leave us taxpayers unable to smile. When will Obama and company figure out that consumers drive the economy, not the banks? Written by kpf
on 3/17/2009
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Bureaucracy defends the status quo long past the time when the quo has lost its status. Written by
on 3/17/2009
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Government can "cross the line" by trying to do too much, and simply make things worse. People are spending less - that's alright as we were spending too much, taking on debt to buy things we really couldn't afford. It will bottom out, level off and the economy will start to grow again. This will happen without any government interference. There WILL BE government interference, but it is at best unnecessary, at worst counterproductive. Written by kpf
on 3/16/2009
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It isn't gloom and doom, it is common sense, folks are simply cutting back on useless crap they don't really need, or really can't afford... Why? Well, perhaps because folks are losing their jobs left and right.... Perhaps because stuff costs waaaaaaaayyyy more than it needs to, perhaps taxes are too high, and on and on and on.... It doesn't take a president to tell folks what they already know...... I didn't vote for Obama, I am not going to blame Obama.... Bush didn't cause the mess, I am not going to blame him for the mess.... The facts are; there are not enought jobs, and there will never be enough jobs... Technology has gauranteed this.... Unless we figure out how to reduce the cost of living domestically, reduce domestic costs, increase our production capabilities and start to export, export, export we will NEVER see the levels of comprable comfort and living standards that we had.......... Simple as that.............. Or continue to be stupid, and send stupid people to schools for years and years for gadzillions of dollars and see how far you get with the economy when all they are in reality are programable drones.......................... Written by
on 3/16/2009
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As a small business owner we are not having any problems with getting credit from our bank. We are having problems with our customers cutting back on spending because of our President's doom and gloom projections that have caused everybody to stop spending. His very liberal agenda and veiled attacks against the oil industry have caused companies to scale back and hold tight until the dust settles, if it ever will. Now we hear about the administration "thinking" about taxing health insurance benefits. They are pushing the card check law. Business friendly, not in my opinion. Written by CN
on 3/16/2009
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