Big TARP Banks Not Helping Small Businesses: (Elizabeth) Warren

Source: CNBC

The government's bank bailout program may have helped big financial institutions weather the credit crisis but has failed in getting money to small businesses, the head of the commission overseeing the fund told CNBC.

Elizabeth Warren called it "infuriating" that the Troubled Asset Relief Program has not achieved its objective in funneling some of the $700 billion in appropriations to small businesses.

A report the commission released Thursday found that big-bank lending portfolios to small businesses dropped 9 percent from 2008 to 2009, more than double the 4.1 decrease of its overall lending portfolio.

"Two out of every three new jobs created in America come out of a small business. Fifty percent of the private work force is in small business," Warren said in an interview. "If they don't have access to credit it's not only a problem to them now, but they can't help fund the recovery."

The report found that several Treasury Department TARP initiatives to get money to small businesses have proven ineffective, in part because banks were not required to lend the billions they had received in capital through the program.

Read more: http://www.cnbc.com/id/37126330

For Profit killing our country. They opened the wound, and refuse dress it. Scum.

Use the money to lend directly to small business then, with 0% interest just as these scumback banks are getting with their loans from the Fed to invest and make Billions.

Banks don't fucking lend anymore. They don't need to. They take our money and invest it for themselves in the scam that is the Stock Market. Break them up.

Thanks Teabaggers and GOP. You are true Americans by supporting these scum. Most of you just have to realize that you are being screwed by them.

Guess she has to be, but let's be real here.

'Elizabeth Warren called it "infuriating" that the Troubled Asset Relief Program has not achieved its objective in funneling some of the $700 billion in appropriations to small businesses.'

That was never its objective, or among its objectives, even if Treasury officials have said so under oath. The objective of TARP was to enrich a financial industry that would then funnel money back into the campaign coffers of the Congresspeople who voted for it.

the more I'm convinced that the feds should just take over all the banks. This situation is just so far out of control there is no reigning it back in without a complete bulldozing and rebuild.

by this administration. They should have concentrated more on helping small businesses than throwing taxpayer-funded lifelines to greedy 'too big to fail' corporations.

I'm telling ya, this is gonna come back and bit him in the ass. America is built on the backs of small businesses and they employ more people than anyone else. This sector can NOT be ignored without huge repercussions.

Doesn't everyone now have their yacht marina finished already.

I was listening to a local talk show last weekend and they had a local bank president on. He threw out some stats (of which I don't remember exactly). Essentially, the community banks make up a small percentage of the banking "power", but give out the vast majority of the small business loans. He seemed concerned that the banking reforms would hurt them in their small business lending.

I don't know if this is true or crap, but I found it interesting nonetheless.

But current proposals will dampen start up business that depends on Angel investors.

Again, I was listening to a local show (about a year ago) and they discussed mark to market accounting. The person on the show was a successful, retired, small bank owner. He said that if mark to market accounting were in place when was in banking, they could not have made a large majority of the loans he did. He said that looking at them from a strictly analytical POV, they would have killed his financial statements and they would have violated all kinds of state banking requirements. However, he said he had a VERY low default rate because he personally knew the people in his community taking out the loans. Unfortunately, this intangible information is excluded from any kind of MTM analysis.

In short, in my opinion, Congress needs to have two tiers of banking standards. The lifeline of our country is small businesses.

Combining them you'd get something like, "Large banks should lend out billions of dollars to small businesses that haven't applied for loans, and in the interim lower their credit requirements so that bad credit-risk small businesses can get loans."

What of that is wrong and what is right I can't figure out. Even this article leaves the "do they actually apply, and are they credit worthy?" question unanswered. Yes, I could infer the answers, but that's a fool's game: reporters these days frequently allow you to infer what they want rather than state what is actually the case. Then when you make a false inference, well, they didn't report that, did they? (No cooperativeness from the reporters, no trust from me that they're presenting things adequately.)

Crooks do not "share" voluntarily.