Say Anything Blog

You know, Gene, I see your point, and I’ve read the articles about micro-credit, but I don’t know that further loosening credit strings is going to help the economy.  I’ve read a few articles on micro-loans from the “Austrian” perspective, and the long & short of what I got from folks at http://www.lewrockwell.com is that there is a lot of smoke and mirrors involved--the one that won the Nobel was more or less a Ponzi scheme.

Probably the best thing to do would be to end corporate welfare and not mess with your bank’s policies.  (and mine, I’m looking into an opportunity or two as well)

I’m iffy on micro-loans too.  Definitely has a place but I can’t think of a way the Guvmint wouldn’t screw it up. 

The problem I’ve mostly seen is small businesses grow to the point that they need to hire.  Hiring the first couple employees is prohibitively expensive in SSN etc and chock full of red tape.  Our tax structure seems to put a sin tax on employing people.

Gene: You got it right.  Our economy grows by investment and reinvestment, not “consumerism”.  Residential property is not a particularly productive investment, in terms of growing the economy, and now we are reaping the consequences of being overfocused in that area.  This too shall pass.

"Give the lefties a pile of money, and they’ll spend it buying votes.” - Rush Limbaugh on the “bailout”.

According to the US Small Business Administration, for the period 1989 thru 2003 over 92% of all net new jobs were created by small businesses!

“Poverty of goods is easily cured; poverty of the mind is irreparable.”

I don’t think we need a government program to lend Gene some more money.  On the other hand I suspect bad policy is mostly responsible for the fact that Gene’s bank are holding back.

Bottom line Gene.  You probably should be shopping around for a new bank that wants to work with you.

What’s going to happen to US industry when the global warming extremists like John McCain double the price of electricity?  I would think all these factories will close and set up in countries where they aren’t scared of technology.

There are other, more competitive sources of investment capital besides banks.

"Give the lefties a pile of money, and they’ll spend it buying votes.” - Rush Limbaugh on the “bailout”.

Bottom line Gene.  You probably should be shopping around for a new bank that wants to work with you.

There are dozens of ways of raising money and banks traditionally don’t seem to want to lend to anyone.  You fight and fight and fight because they have lending guidelines that are designed to do large loans to existing companies, not small loans to startups.  And I understand that from an investing perspective.  Startup loans are far riskier and given the comparative risks, the differential in interest rates often does not justify lending to smaller companies as opposed to doing larger loans. 

I am in the process of opening a restaurant now so I feel your pain.  An increasing kind of business is loan brokering where you deal with a broker who charges a commission to put together your package and send it to dozens of lenders as opposed to you serially going from one to the next to the next.