Reading and hearing some of the many news stories about this bogus "help" for small businesses inspired my latest status and this blog. They just don't understand that many banks aren't lending because
a) they tightened up their lending standards in response to criticism from regulators
b) logically following the above, fewer businesses qualify for loans DUH
a) they tightened up their lending standards in response to criticism from regulators
b) logically following the above, fewer businesses qualify for loans DUH
and most importantly
c)those small business owners who do qualify for loans are not seeking them.
This is a no-brainer (at least to those of us who are thinking)-and consumers are doing the same thing. Hunkering down, paying down existing debt, saving money. Why are businesses and consumers doing this? Because they want to be ready for the next assault on their pocketbooks! There's a new bogeyman every day, it seems, and no one wants to be the one without a seat in musical chairs. Until this administration and congress decide (or get voted OUT) that they are going to leave businesses alone to do what they do best-invest, take prudent risks, make a profit, expand and hire- businesses are going to sit on their hands and wait.
As it goes for businesses, so for consumers. I keep hearing about the increase in savings in the US. Well duh-no one knows how much things will cost or how much their tax bill will be, so a little prudence goes a long way. This is so simple and self-evident that only the most blatant of ideologues will miss it; all the rest don't want to know.
This is why an article like the one below really sticks in my craw-WE DON'T NEED a bogus "program" to encourage small banks to lend-it's counterintuitive!!!!! If businesses and banks feel that the economic environment has stabilized, and they can predict with a modicum of certainty what it will cost them to keep the doors open, they will borrow, invest, and hire. But until then they are still hunkering down, and this "program" is a pile of political dogshit stinking up our computer screens.
I keep thinking back to my econ courses at Stockton in the 90s, when we learned that in order for a developing country to make the leap to a successful economy, they MUST have a stable government and political and economic infrastructure. People and companies, both domestic and foreign, will NOT invest in an unstable country.
Well guess what-we are that unstable country now!!! The ground is constantly moving under our feet, so it's no wonder everyone is hunkered down!
So anyway-here is the article that underscores just how out of it "they" (most of the federal govt as well as the mainstream media) are. Read it and weep. Oh and please leave me a kudo if you read this. You may not want to comment but I really need you to THINK about this. Thank you
http://news.yahoo.com/s/nm/20100202/bs_nm/us_obama_lending
Oh and PS-the TARP money needs to go right back into the Treasury. Just sayin
As it goes for businesses, so for consumers. I keep hearing about the increase in savings in the US. Well duh-no one knows how much things will cost or how much their tax bill will be, so a little prudence goes a long way. This is so simple and self-evident that only the most blatant of ideologues will miss it; all the rest don't want to know.
This is why an article like the one below really sticks in my craw-WE DON'T NEED a bogus "program" to encourage small banks to lend-it's counterintuitive!!!!! If businesses and banks feel that the economic environment has stabilized, and they can predict with a modicum of certainty what it will cost them to keep the doors open, they will borrow, invest, and hire. But until then they are still hunkering down, and this "program" is a pile of political dogshit stinking up our computer screens.
I keep thinking back to my econ courses at Stockton in the 90s, when we learned that in order for a developing country to make the leap to a successful economy, they MUST have a stable government and political and economic infrastructure. People and companies, both domestic and foreign, will NOT invest in an unstable country.
Well guess what-we are that unstable country now!!! The ground is constantly moving under our feet, so it's no wonder everyone is hunkered down!
So anyway-here is the article that underscores just how out of it "they" (most of the federal govt as well as the mainstream media) are. Read it and weep. Oh and please leave me a kudo if you read this. You may not want to comment but I really need you to THINK about this. Thank you
http://news.yahoo.com/s/nm/20100202/bs_nm/us_obama_lending
Oh and PS-the TARP money needs to go right back into the Treasury. Just sayin
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