Small Business Loans Still Declining
Small business loans are defined by the SBA as loans under $1 million dollars. The number of these small business loans have also continued their long-term decline over the first half of 2011. At the same time, loans to large and medium-size businesses increased. Unfortunately, it appears that access to money for many small businesses is still like finding the Holy Grail.
This information is from the latest Quarterly Lending Bulletin published by the SBA a few days ago.
This problem could become an even larger stumbling block to future economic growth if demand for goods and services from small businesses increases suddenly and those small businesses have no resources to expand their capabilities. Apparently no one is thinking about this possibility.
Although it is too late for many small businesses (who are gone), there are still many of those left, asking the question; “Now that the banks and big businesses are bailed out, when are small businesses going to be bailed out?”
Apparently bailouts work well, according to the latest news from The NY Times:
- Wells Fargo just posted a 21% rise in it’s third-quarter earnings—$4.1 Billion.
- Citigroup reported a third-quarter rise in earnings of 74% —$3.8 Billion. This is the seventh-straight quarterly rise in profits for Citigroup.
Couple the bank’s rise in profits with the auto industry’s rise in profits and it becomes obvious that bailouts work for big business. Too bad the government only wants to take from small business.
Could it be because there is a dearth of small business experience in Washington? Obama’s Cabinet contains the lowest number of private sector people since records started with Teddy Roosevelt (Forbes).
Worse yet–the vast majority of lawmakers in Washington are “professional bureaucrats” who wouldn’t know how to run a small business if there life depended on it.
What do you think this scenario holds for your small business?
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