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Where are the Banks?
I hear from small businesses the
good and the bad news.
The good news is that the Coronavirus Aid, Relief and Economic Security Act, or CARES, Act with its Paycheck Protection Program was conceived to immediately help small employers to keep employees and bridge 8 weeks of confinement.
The bad news is the small business needs to apply through a bank. The larger the bank however, the more resistance to the program there seems to be. They say they need clarification about their
liability. They were closed over the weekend. There was no sense of urgency.
Back to 2008, when everyone including small businesses saved the banks. Every taxpayer, every small business shouldered part of the mess created by toxic bank products. Action was needed
over the weekend. There was a sense of urgency. Immediate action was taken back in 2008.
Banks sit on the results of an economy that was still booming a month ago. For years the Federal Reserve and the public has provided banks with almost zero cost funds. But they don’t seem
to be too excited to send the elevator back to those who saved them. Again, it is that individual taxpayer that backs and complements the indispensable relief action intended by the government. The average citizen multiplies initiatives
to volunteer and support neighbors, the elderly, and even hospitals. But the banks have problems with urgent loans that are guaranteed by SBA and are essentially forgivable?
An update: Wells Fargo shows its
hand:
