Dewell Marketing

Yesterday I wrote series of posts on the problem smaller businesses have in getting financing. Then, last night I was reading through the June 14 – June 20 issue of Bloomberg Businessweek and came across an article I thought I should share.

This is an excerpt from an interview that one of Bloomberg’s columnists, Charlie Rose, did with Meredith Whitney who runs her own investment advisory group. She was also featured later in the same issue in an article on investment advisors who are bears on the future of the stock market.

In the interview, here is what she said to the question: “How do the next six months look?”

“I think there are massive structural problems underpinning the employment picture in the US. Small businesses, which employed about 50 million people and have been responsible for more than 60 percent of job creation over the last 15 years, have no way to fund themselves. So they’re out of the game.” (Emphasis added)

Further in the interview, to the question, “Where is small business confidence today?”, she answered:

“According to the latest survey that came out yesterday, it’s improving. But when you ask small businesses what’s the main reason they’re not hiring, they say lack of access to credit. Small businesses fund themselves through credit card and home equity loans.” (Emphasis added)

She answers in part to one other question about her outlook for the next six months: “I am more bearish than I’ve been in a year.”

So where does that leave the US’s “job engine”? Trillions of dollars have been created out of thin air by our government and they have been used to make balance sheets look good for huge corporations who are not the job engines. Most of them, in fact, have been instrumental in creating the economic crisis we are still in today and which will last for a long time.

They were given this huge credit gift in order to keep credit to businesses flowing to keep the economy running. Have you gotten any of it? I know I haven’t. You and I, my friend, are small enough to fail!

You can read the entire interview with Meredith Whitney here: http://www.businessweek.com/magazine/content/10_25/b4183043333124.htm