I hate billionaires not spending this pocket change but depending on government for such loans.
But to play devil's advocate, aren't these most/all companies set up as limited liability, and therefore these billionaire owners are absolved of any responsibility to take on such bailouts?
So is this moral problem or more a structural problem on how the enterprise is being set up?
Searchable PPP Loan Data
211–220 of 354 posts
Re: Searchable PPP Loan Data
#212Earlier quoted context omitted.
>I know many households who received $4k+ in stimulus checks that didn't need it. Should they not have taken it? I'd rather have some of the waste money going to families over businesses for once. Families have to worry about loss of income and loss of health during this. Businesses just have to worry about income. Families are more fragile and should be prioritized.
I am not necessarily disagreeing with you but a lot of small businesses in the US survive on thin margins and the owners also don't make a lot of money necessarily. So it is not always the case that a company only has to worry about income. They have to worry about paying employees, ensuring they can meet payroll (which in turn helps families of those workers), keep liabilities in check and many other issues. I am to…
The outrage is that the money didn't go to small businesses, but rather large ones who had the means to cheat the system.
Re: Searchable PPP Loan Data
#213Of all types of institutions, why should we be giving the banks the right to decide which businesses should be recession proof or not? Personal opinion but I would have required the applicants of these quasi-forgiveness loans to give up 35% of their businesses to the state/county/federal inclusive of all assets and investments non-dischargeable by bankruptcy. We have 100,000 people dead in this country, million dolla…
No business with a 5-10% net margin can save 2 months operating expenses just in the off chance that there is a black swan event because doing so would put them at a competitive disadvantage over competition that doesn’t save and instead uses the money to lower prices, pay higher wages or invest in new products.
Meanwhile the government can borrow money at almost negative rates, based on long term tax collections, and arbitrage short term financial harm and need against long term repayment. Seems like a rational thing to do.
Re: Searchable PPP Loan Data
#214So many complaints here. Based on the comments I think there is some misunderstanding about the nuts and bolts of this program. These are loans. They are two year low interest loans. They have to be paid back unless some or all is forgiven. Forgiveness requires documentation on employees retained, wage history, and is capped at $20k/employee maximum. And of course a piece of that comes back to the government in terms…
> Should they not have taken it? I seriously considered not cashing my stimulus check until I talked to multiple well off people that cashed their dead relative's checks. There just isnt a cultural expectation in the US that you wouldn't take what you're given. EDIT: Rethinking my comment I'm giving myself too much credit. Since I never got a physical check, I couldn't have "not cashed it" if I wanted to.
To your point, I know a bunch of people who applied for the forgivable loans just to see if they could get it. I know a guy who owns over two hundred Domino's franchises and got a $6M forgivable loan and his business has been up 30% since covid started. He can't hire people fast enough.
Another friend was pissed that he wasn't approved for a loan too even though he has zero employees.
Re: Searchable PPP Loan Data
#215Earlier quoted context omitted.
>These are loans. They are two year low interest loans. They have to be paid back unless some or all is forgiven. This is a highly politicized way to frame PPP loans. Its more like: "These loans are forgiven, unless you scammed the government." These loans were specifically designed to be forgiven, a minimum of 75% of the loan was to be for payroll and if used for payroll (what it was supposed to be used for) that po…
Politicized? Give it a rest. Yes, if a company spent 60% (down from 75%) of their loan on payroll, and does not exceed the 20k cap per employee, and retained the same number of employees they had at the beginning of the covered period, and can document all this, and they followed the initial SBA guidance when deciding how big of a loan to apply for, then they will get most or all of the loan forgiven. There are lots…
>"what about the nail salon who has 14 employees and took 5-10M?!?!".
If true that is an obvious case of fraud and you are making my point, the only time a loan will be repaid is if the money was spent on things other than payroll...which amounts to fraud.
Who cares if its a nail salon? Math is math, if you have 14 employees the maximum eligibility would be 8 weeks of payroll with a cap at $100k salary + up to an addition 25% for non-payroll expenses. $5-$10M for a business with 14 employees is fraud on its face.
Re: Searchable PPP Loan Data
#216I think PPP saved the economy. We can scapegoat and find problems. But don’t ignore what would have happened in its absence. Companies would reduce spending at the very least or go out of business at the worst. We would have entered a self reinforcing cycle of reduced spending and purchasing creating a depression.
I agree. I'm horrified by the current administration and their handling of the health side of this pandemic, and I'm completely shocked at how well the Federal government and the Federal Reserve have managed the economic side. Between the stimulus checks, the PPP, and the trillions spent by the Federal Reserve to prop up various markets. Yes, many mistakes were made and we'll end up having spent hundreds of billions on fraud and waste, but I don't think people have an inkling of how bad things would have gotten otherwise. All I can say is that I'm glad most of the people commenting here aren't in charge or this country would have completely collapsed.
And it still could! I think things will get very dark very fast if Congress doesn't extend at least some of the $600 / week unemployment benefits.
Re: Searchable PPP Loan Data
#217Of all types of institutions, why should we be giving the banks the right to decide which businesses should be recession proof or not? Personal opinion but I would have required the applicants of these quasi-forgiveness loans to give up 35% of their businesses to the state/county/federal inclusive of all assets and investments non-dischargeable by bankruptcy. We have 100,000 people dead in this country, million dolla…
I don't think you realize just how perilous the economic situation was in mid-late march. Money had to reach Businesses very quickly, regardless if some of the money would end up wasted. Only banks have the manpower, infrastructure and knowledge already in place to reach even small businesses across the entire country. There was absolutely no way for any governmental agency to be able to manage such a huge program in…
Great response. I wish all of the people criticizing these efforts would actually try to design a better program. Even the thought exercise would show how difficult it would be. Easier to crap on the work of others than actually do it yourself.
I also wish they would think about the consequences of no action. They probably don’t realize that cascade bank failures and supply chain disruptions happen fast and become permanent. In March there was a realistic possibility of systematic seizure of finance and the supply chain grinding to a total halt due to lack of financing. How do you stock groceries when they can’t buy inventory?
Re: Searchable PPP Loan Data
#218Without this program, my employer would have had to either lay off a large group of employees or we would've gone under. As it is, out of a group of about 50, we furloughed 8, who continued without pay, qualified for unemployment benefits, but retained 100% health coverage. Two have returned to work already and we anticipate being more or less normal again in time to meet the loan forgiveness criteria. It's good to h…
So will your employer be paying the "loan" back?
Most of the loan isn't designed to be paid back. So what are you getting at?
Re: Searchable PPP Loan Data
#219I hate billionaires not spending this pocket change but depending on government for such loans. But to play devil's advocate, aren't these most/all companies set up as limited liability, and therefore these billionaire owners are absolved of any responsibility to take on such bailouts? So is this moral problem or more a structural problem on how the enterprise is being set up?
"Billionaires" (or the much, much more common millionaires and hundred-thousand-aires who own most companies) wouldn't "spend the pocket change", they'd just lay people off or furlough them. This program was designed to keep businesses afloat and to keep them from laying off employees. It's a nice idea to think that all these companies would just altruistically keep their employees around doing nothing while they're shut down, but that wouldn't happen.
Re: Searchable PPP Loan Data
#220Earlier quoted context omitted.
Politicized? Give it a rest. Yes, if a company spent 60% (down from 75%) of their loan on payroll, and does not exceed the 20k cap per employee, and retained the same number of employees they had at the beginning of the covered period, and can document all this, and they followed the initial SBA guidance when deciding how big of a loan to apply for, then they will get most or all of the loan forgiven. There are lots…
>"what about the nail salon who has 14 employees and took 5-10M?!?!". If true that is an obvious case of fraud and you are making my point, the only time a loan will be repaid is if the money was spent on things other than payroll...which amounts to fraud. Who cares if its a nail salon? Math is math, if you have 14 employees the maximum eligibility would be 8 weeks of payroll with a cap at $100k salary + up to an add…
I know lots of folks who got PPP loans. I don't know anyone who's getting 100% of their loan forgiven. Mainly because they took 2.5x monthly payroll as a loan - but then did an 8 week covered period (2x monthly payroll). Most of them will owe ~20% of the loan back to their lender since they had minimal other expenses.