TARP Isn’t Working For Small Business; Two Simple Solutions To Get Small Business Lending Going Again

A Joint Article By Mark Sunshine and Robert Blum

Unfortunately, the Obama Administration isn’t proposing much to help restart lending to small and medium sized enterprises (”SMEs”). While SME’s make up the backbone of the U.S. economy and provide most of its job creation, the credit crisis is making them economic road kill. SME’s are small manufacturing and service businesses are innocent victims; they pay their bills, employ workers and aren’t particularly over leveraged. However, the credit crisis doesn’t discriminate between the “guilty” and the “innocent”; it is an equal opportunity business killer. Regrettably, while Washington knows that that economic recovery requires a normally functioning and sound small business lending sector, the Obama Administration hasn’t found the right policy initiatives to restart SME lending. Even worse, pumping trillions into zombie banks has the unintended side effect of enabling these banks to suck the economic life out of SMEs.

Fortunately, there are relatively inexpensive measures that can quickly restart SME lending on a safe and sound basis. Targeted modifications in the tax code and mutual fund regulations can change the landscape of SME lending by dramatically enlarging the capital base and types of lenders that lend to SMEs.   <<< CONTINUE <<<

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Regulatory Reform: Change We Can Believe In – A Guest Blog by Tom Berner

With the focus in Washington on bank bailouts and stimulus packages, we have yet to hear about any serious proposals for new regulations. Nevertheless, they will come, and anyone who thinks that a President McCain would have treated Wall Street any less harshly than President Obama must have been asleep during the Presidential campaign. Indeed, since Wall Street’s campaign contributions went to President Obama by a wide margin, it is clear that Wall Street, for one, didn’t expect mercy from the GOP. Stronger regulation was in the cards no matter who dealt the hand. The tricky part, however, is determining the kind of regulation that will have a beneficial effect on any part of the economy other than the pockets of the legal profession. There are several pitfalls to designing a satisfactory regulatory reform program. -  outlines 4 problems and 2 principals to guide Obama 

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