John Kerry: “over the past few months, our country has experienced instability and volatility in its credit markets. This looming…”

“over the past few months, our country has experienced instability and volatility in its credit markets. This looming credit crisis is affecting virtually every sector of the economy, including small business financing. Since its inception in 1953, the Small Business Administration's 7(a) loan guaranty program has become the largest single source of long-term capital for small businesses. However, in the wake of the credit crunch and a slowing U.S. economy, we are now noticing that this essential financing resource is not serving nearly as many small businesses as it should. For example, during the first quarter of the 2008 fiscal year, 7(a) lending was down by 12 percent compared with the same period last year. In addition, at his State of the Agency Address this past Tuesday, SBA Administrator Steven Preston acknowledged that SBA lending was down in its largest program. The Small Business Stimulus Act of 2008 will help reverse this downward trend in small business lending. The bill will temporarily reduce the fees collected from borrowers and lenders. This will immediately reduce the cost of capital for small businesses. With lower monthly loan payments, more money will be placed into the hands of small business owners money that will be quickly injected into the economy through purchases of inventory, real estate, and equipment.”