commando Posted April 7, 2020 Share Posted April 7, 2020 8 minutes ago, knapplc said: The people who don't get why Trump has to be voted out just aren't paying attention. wonder how much of the $2 trillion Trump will pocket and how much will go to his allies? Link to comment
knapplc Posted April 7, 2020 Share Posted April 7, 2020 1 minute ago, commando said: wonder how much of the $2 trillion Trump will pocket and how much will go to his allies? As much as humanly possible. Link to comment
Moiraine Posted April 7, 2020 Share Posted April 7, 2020 Either I didn't pay enough attention or they've made subsequent changes; no interest will accrue on federal student loans until October. This is good news. Link to comment
BigRedBuster Posted April 7, 2020 Author Share Posted April 7, 2020 2 hours ago, Moiraine said: Either I didn't pay enough attention or they've made subsequent changes; no interest will accrue on federal student loans until October. This is good news. OK....but did the defer payments? Link to comment
Moiraine Posted April 7, 2020 Share Posted April 7, 2020 1 hour ago, BigRedBuster said: OK....but did the defer payments? Yes, that was already known. But it irritated me that they were still charging interest each month, not 'cause I can't afford it but because it just seemed like something that should happen during this time. Now they're doing both. Link to comment
TGHusker Posted April 8, 2020 Share Posted April 8, 2020 I'm sure this will put all small business owners at ease. Ivanka is over the $349 billion loan program. https://www.cnn.com/2020/04/08/politics/ivanka-trump-small-business/index.html Quote Like many at the White House, Ivanka Trump has shifted her focus to the coronavirus response prioritizing its small business efforts. Trump has long included small business and entrepreneurship as part of her West Wing portfolio, along with workforce development and women's economic empowerment, but this renewed effort comes at a time when millions of Americans who own and work at small businesses are facing dire financial situations due to a near-shutdown of the economy. The Trump administration began its rollout last week of a massive $349 billion loan program, the Paycheck Protection Program, through the Small Business Administration. Despite a rocky rollout, the White House this week requested an extensive $251 billion in additional funds it is working quickly with Congress to pass by the end of the week. President Donald Trump's daughter and top adviser has been involved with the program, and on Tuesday, participated in a teleconference call with banking executives alongside her father in the Roosevelt Room. Link to comment
TGHusker Posted April 8, 2020 Share Posted April 8, 2020 and more good news for small businesses - The system is rigged in favor of the banks - thanks to Mr Mnuchin. To compare him to a snake would be to offend the snake. https://thefederalist.com/2020/04/08/the-senates-plan-to-save-small-businesses-is-already-failing-and-mnuchin-just-made-it-worse/ Remember the deal the president signed to save America’s small businesses from ruin during the government’s coronavirus shutdown? The one hammered out by the Senate and Secretary of the Treasury Steven Mnuchin over weeks of tense negotiation while Americans worriedly watched, hoping good news might come before a depression does? The details are out of Treasury now, and it looks like it isn’t going to work for a large number of small business owners after all. It isn’t going to work because the Senate’s formula allows far too little money to make up for a lost month and get through the following two or more while meeting the Senate’s demands. The Senate made these demands to protect workers, but did not provide the money a lot of businesses will need to protect workers and themselves. It’s just common sense, Washington will say, to protect workers and the taxpayer in these hard times. Then, even if there was enough money, it isn’t going to work because Mnuchin crafted loan parameters that make it untenable for nearly all small businesses should the Senate’s demands not be met, which would mean the loan doesn’t qualify for forgiveness. Treasury did this last bit to protect the banks while pushing them to make loans they aren’t otherwise making. It’s just common sense, he’ll say, because local and regional banks couldn’t make a more generous deal work — a problem Mnuchin knew was coming the entire time the Senate negotiated, of course. Here’s how it all plays out in real life. Imagine you own a restaurant with a gross revenue of $1.2 million a year, or $100,000 a month. This business employs eight people and has gross expenses of $1 million a year, or $85,000 a month. So in a normal year for your restaurant, you get to take home $200,000, minus taxes. A 20 percent profit, by the way, puts you above and beyond a lot of America’s small businesses, which will be dealing with tighter margins than the ones below. Your monthly expenses don’t include buying goods anymore, because the government shut you down for the pandemic, but they still include rent or interest on your mortgage, the real estate tax, building insurance, maintenance and utilities, coming to $15,000 a month in your case. Then you have, say, $30,000 a month in payroll before taxes, and none of this includes your own pay. Now you need a loan. The Senate’s loan amount is generated by multiplying a business’s monthly payroll by 2.5. The loan is meant to cover two months and can go toward your costs and utilities, but to qualify for grant forgiveness you need to retain your entire workforce and put at least 75 percent of the loan toward them.At 2.5 times your monthly payroll, which is $30,000, you’re looking at a $75,000 loan. If this seems less than your needs, it’s because it is. You’re already in the hole because you saw a steep decline in business in March as the pandemic spread, but you didn’t know what was coming so you kept your full staff without earning near full revenue. Now you’ve got $75,000 for the next two months, but two months of payroll, rent and utilities swings in at $90,000 — $15,000 more than the loan that already doesn’t take last month into account. The city closed your restaurant the next two months too, by the way, so you won’t be earning a dime of revenue in that time. By June, you’ve earned no income and you’re halfway through your year. If you could get roaring again right away you might make up some of that, but you’re a restaurant and unless a cure is suddenly widely available, occupancy will be severely limited by the state and revenue won’t be what it once was. It might not be profitable to open at all, given new distancing requirements and their impact on sales. If you don’t make the Senate’s requirements, you have to pay that loan back, and thanks to Mnuchin, you’re not going to be able to do that either. In the bill, Congress set a window of a maximum interest of 4 percent and loan repayment within 10 years. This was just a window, so it was up to Treasury to set the final costs and they put them at 1 percent interest and two years to pay the bank. Link to comment
BigRedBuster Posted April 8, 2020 Author Share Posted April 8, 2020 39 minutes ago, TGHusker said: and more good news for small businesses - The system is rigged in favor of the banks - thanks to Mr Mnuchin. To compare him to a snake would be to offend the snake. https://thefederalist.com/2020/04/08/the-senates-plan-to-save-small-businesses-is-already-failing-and-mnuchin-just-made-it-worse/ Remember the deal the president signed to save America’s small businesses from ruin during the government’s coronavirus shutdown? The one hammered out by the Senate and Secretary of the Treasury Steven Mnuchin over weeks of tense negotiation while Americans worriedly watched, hoping good news might come before a depression does? The details are out of Treasury now, and it looks like it isn’t going to work for a large number of small business owners after all. It isn’t going to work because the Senate’s formula allows far too little money to make up for a lost month and get through the following two or more while meeting the Senate’s demands. The Senate made these demands to protect workers, but did not provide the money a lot of businesses will need to protect workers and themselves. It’s just common sense, Washington will say, to protect workers and the taxpayer in these hard times. Then, even if there was enough money, it isn’t going to work because Mnuchin crafted loan parameters that make it untenable for nearly all small businesses should the Senate’s demands not be met, which would mean the loan doesn’t qualify for forgiveness. Treasury did this last bit to protect the banks while pushing them to make loans they aren’t otherwise making. It’s just common sense, he’ll say, because local and regional banks couldn’t make a more generous deal work — a problem Mnuchin knew was coming the entire time the Senate negotiated, of course. Here’s how it all plays out in real life. Imagine you own a restaurant with a gross revenue of $1.2 million a year, or $100,000 a month. This business employs eight people and has gross expenses of $1 million a year, or $85,000 a month. So in a normal year for your restaurant, you get to take home $200,000, minus taxes. A 20 percent profit, by the way, puts you above and beyond a lot of America’s small businesses, which will be dealing with tighter margins than the ones below. Your monthly expenses don’t include buying goods anymore, because the government shut you down for the pandemic, but they still include rent or interest on your mortgage, the real estate tax, building insurance, maintenance and utilities, coming to $15,000 a month in your case. Then you have, say, $30,000 a month in payroll before taxes, and none of this includes your own pay. Now you need a loan. The Senate’s loan amount is generated by multiplying a business’s monthly payroll by 2.5. The loan is meant to cover two months and can go toward your costs and utilities, but to qualify for grant forgiveness you need to retain your entire workforce and put at least 75 percent of the loan toward them.At 2.5 times your monthly payroll, which is $30,000, you’re looking at a $75,000 loan. If this seems less than your needs, it’s because it is. You’re already in the hole because you saw a steep decline in business in March as the pandemic spread, but you didn’t know what was coming so you kept your full staff without earning near full revenue. Now you’ve got $75,000 for the next two months, but two months of payroll, rent and utilities swings in at $90,000 — $15,000 more than the loan that already doesn’t take last month into account. The city closed your restaurant the next two months too, by the way, so you won’t be earning a dime of revenue in that time. By June, you’ve earned no income and you’re halfway through your year. If you could get roaring again right away you might make up some of that, but you’re a restaurant and unless a cure is suddenly widely available, occupancy will be severely limited by the state and revenue won’t be what it once was. It might not be profitable to open at all, given new distancing requirements and their impact on sales. If you don’t make the Senate’s requirements, you have to pay that loan back, and thanks to Mnuchin, you’re not going to be able to do that either. In the bill, Congress set a window of a maximum interest of 4 percent and loan repayment within 10 years. This was just a window, so it was up to Treasury to set the final costs and they put them at 1 percent interest and two years to pay the bank. I'm a little confused on this compared to what I'm actually finding. The link on parameters above isLINK. We have found that the original offer was 3-4% interest over 10 years. Then, it switched to .5% over 2 years. Then, supposedly the banks didn't like the interest rate so it was raised to 1% over 2 years. Which, is bull s#!t because they have no risk at all, it doesn't go against their borrowing reserves and they get an origination fee paid to them by the feds. So, they are already making money. Anyway, this isn't what is in this article. So, I question the validity of their complaint. Link to comment
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