The Federal Reserve recently announced that banks are beginning to compete much more now and, effectively, creating an atmosphere where small businesses have more options to receive loans and hence begin to invest in their businesses again.
From April to June, the Federal Reserve (which is actually not Federal, a private group of banks owned by local and foreign corporations) reported that the number of loans to small businesses increased considerably which they attribute to the increased competition previously mentioned.
This is overall positive news for small businesses, who have been hurt by the lack of funds and tightening of credit due to the financial crisis.
Whether or not this trend continues is anyone’s guess, but if it continues in this direction it can only be helpful and encouraging news for the overall future of business, since small companies depend on the banks for loans to improve productivity, hire new people, and enter into new markets.
The Federal Reserve has come under serious fire recently, when HR 1207 was introduced at the house of representatives. The very secret organization, which is not a government agency, has never been audited since its inception in 1913 and some pundits have gone so far to even blame them for causing the financial crisis.