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Is the number expected to be this high? I thought one of the core ideas of the stimulus was to prevent firing by giving small businesses a "free" loan if they r

Is the number expected to be this high? I thought one of the core ideas of the stimulus was to prevent firing by giving small businesses a "free" loan if they retained their employees? I've been trying to find a good authority on the economics of this stimulus but it seems I am always stuck finding the same "rehashed" news articles.

lonelappde 7y ago
Stimulus takes a long time to "trickle down"
rrtthu 7y ago
Part of the stimulus is ensuring that unemployed people will get enough cash to live by. They increased the allowance by 600USD per week.
- techntoke 7y ago
  That's really not that much. Won't pay for a 1 bedroom apartment in San Francisco, especially after gas and groceries.
  - gd2 7y ago
    True even while gas is almost zero because not driving.
  - mrfusion 7y ago
    Unemployment in FL maxes out at $275/week. Digest on that for a while.
  - _curious_ 7y ago
    Maybe SF is not a tenable place to live anymore for ___%? Maybe they will be inconvenienced by forced relocation? Maybe no-one is entitled to continue living today the way they did yesterday?
    - ModernMech 7y ago
      Maybe some people can neither afford to move nor live in their apartment and will end up homeless. The people having the hardest time living in SF are the people we now call "essential workers" and "heroes" for doing the jobs we all depend on to survive. What exactly do you think happens to the city of San Francisco when all the "essential workers" are forced to move away or are homeless?
      - _curious_ 7y ago
        "What exactly do you think happens to the city of San Francisco when all the "essential workers" are forced to move away or are homeless?" It implodes!?
- techdevangelist 7y ago
  I don’t think any states are paying that extra 600/week out yet, where I’m at they are still recoding for it and expecting several more weeks. It’ll be back dated but still, and with the numbers of claims I’m wondering how much capital they really have for it.
- mrfusion 7y ago
  Questions I can’t find answers to: How does this actually work? Do the states manage the extra 600? Will it just appear one day for people on unemployment? What if your state has stricter unemployment rules than the stimulus bill? You’d be eligible for the 600 but not able to get it?
jmclnx 7y ago
The core ideas were reported upon, the real purpose is to bail out the banks (once again) and the fortune 500 companies. Very little is going to the people hardest hit.
- miked85 7y ago
  This is false, the plan specifically targeted small businesses: https://www.sba.gov/page/coronavirus-covid-19-small-business-guidance-loan-resources https://www.sba.gov/page/coronavirus-covid-19-small-business...
  - techntoke 7y ago
    You mean the money being managed by the person Trump just fired?
    - techntoke 7y ago
      Here, would you like proof? https://www.latimes.com/world-nation/story/2020-04-07/trump-upends-virus-oversight-removing-key-official https://www.latimes.com/world-nation/story/2020-04-07/trump-...
    - deleted 7y ago
      [deleted]
  - notyourday 7y ago
    The plan is a death spiral financing which puts a small business into a worse position after taking it than before. They have no revenue due to a government action, loan is based on the value of their payroll with the revenue and the the small business is required to spend 75% of the loan for payroll while being closed. The fact that banks claimed that 0.5% interest is not enough for them to make it worth it so the Treasury bumped the number and cut repayment schedule is the clearest demonstration yet that it is another hand out to banks.
    - chasd00 7y ago
jt2190 7y ago
Yes. This is part of the United State's Main Street Lending Program, called the Paycheck Protection Program (PPP). The federal government is guaranteeing loans made by private banks. This is taking time to work its way thorough the banks, as they try to understand their long-term legal obligations. In the mean time, some businesses are laying off or furloughing their employees so that their employees can get some money by claiming for unemployment benefits. Unemployment systems are established and somewhat functioning, unlike the loans, which probably need another week or two to start having an impact. Presumably, some of the workers will be recalled once loans are established. Edit: Removed redundant word.
- _curious_ 7y ago
  "Presumably, some of the workers will be recalled when once loans are established." So what happens if you are kept or rehired by your company under the PPP - but don't have any actual work to do?
tfandango 7y ago
The "free" loan is reportedly difficult to get since the government leaned on banks to provide these and banks are doing whatever they can to avoid the situation. For instance, Wells Fargo says they are out of those loans and Bank of America tried to make these loans dependent on already having another loan with them (policy revoked after outcry). Small businesses in our town are laying everyone off instead of waiting on these loans b/c the employees can qualify and receive unemployment immediately now. Once things open again, they plan to rehire the same people if possible. All this is anecdotal but seems to me that new unemployment rules are part of the rescue package (I don't really consider it a stimulus package)
rixrax 7y ago
Assume you are small business. Now try to find where / how / when You will get stimulus money? To cover what? I sure can’t.
- _curious_ 7y ago
  It's literally the gov just giving out money so these companies can keep the doors open and lights on under the guise of 'being in business'. The point is more of a psychological one - to create impression that things are going ok (or not as bad as it seems) at scale across the country.
  - ModernMech 7y ago
    That's the theory, but in practice it's turning out harder than expected to acquire said money. The government isn't just "giving it out" in the sense you can just walk up to a bank and leave with a bag of cash. You have to apply for it and then be approved and then wait for it to show up. This process takes time, and it's not clear how much time. Another poster noted that Wells Fargo was capped at what they can distribute and BOA was refusing loans to people who were not already customers. So if you're a small business with Wells Fargo and get denied there after an unknown period of time it takes to process that application, then you turn to another large bank and get denied there, this is time wasted while a clock is ticking (rent is still due for your employees and yourself at the end of the month). So what do you do? Do you lay off your employees because they can apply for unemployment right away? Or do you hold out and hope that the third bank you apply to for a loan will be a success? What if it's not? It's very easy for Congress to say "We are giving out money. The businesses are saved!" It's quite another in the implementation of that, and to some degree I feel they were so eager to pass something that they didn't think these things through fully.
    - _curious_ 7y ago
      "So what do you do? Do you lay off your employees because they can apply for unemployment right away? Or do you hold out and hope that the third bank you apply to for a loan will be a success? What if it's not?" That's a case by case judgement call that only the owners/operators can answer given their situations and values. There is not universal or general advice answer here. "It's very easy for Congress to say "We are giving out money. The businesses are saved!" It's quite another in the implementation of that, and to some degree I feel they were so eager to pass something that they didn't think these things through fully." I fully agree and my comment above was to suggest their intent.
_curious_ 7y ago
"Is the number expected to be this high?" = Yes, some models/estimates suggest it will reach 30m, though I don't recall the horizon. "I thought one of the core ideas of the stimulus was to prevent firing by giving small businesses a "free" loan if they retained their employees?" = In some cases, I'm hearing that it is happening. In others, the funds are not flowing so owner/operators are proceeding to 'let go'. "I've been trying to find a good authority on the economics of this stimulus" = Understandable, but difficult enough during 'normal' conditions. Now, everyone becomes an expert.
nunez 7y ago
A lot of SMBs are having issues actually getting the money. One example: Wells Fargo is only authorized to distribute $10B of the money from PPP because of their scandal a few years back. Many SMBs use Wells Fargo for their business checking accounts. This has created a massive delay queue with folks having to reapply for assistance several times to no avail.

lonelappde 7y ago

Stimulus takes a long time to "trickle down"

rrtthu 7y ago

Part of the stimulus is ensuring that unemployed people will get enough cash to live by. They increased the allowance by 600USD per week.

techntoke 7y ago
That's really not that much. Won't pay for a 1 bedroom apartment in San Francisco, especially after gas and groceries.
- gd2 7y ago
  True even while gas is almost zero because not driving.
- mrfusion 7y ago
  Unemployment in FL maxes out at $275/week. Digest on that for a while.
- _curious_ 7y ago
  Maybe SF is not a tenable place to live anymore for ___%? Maybe they will be inconvenienced by forced relocation? Maybe no-one is entitled to continue living today the way they did yesterday?
  - ModernMech 7y ago
    Maybe some people can neither afford to move nor live in their apartment and will end up homeless. The people having the hardest time living in SF are the people we now call "essential workers" and "heroes" for doing the jobs we all depend on to survive. What exactly do you think happens to the city of San Francisco when all the "essential workers" are forced to move away or are homeless?
    - _curious_ 7y ago
      "What exactly do you think happens to the city of San Francisco when all the "essential workers" are forced to move away or are homeless?" It implodes!?
techdevangelist 7y ago
I don’t think any states are paying that extra 600/week out yet, where I’m at they are still recoding for it and expecting several more weeks. It’ll be back dated but still, and with the numbers of claims I’m wondering how much capital they really have for it.
mrfusion 7y ago
Questions I can’t find answers to: How does this actually work? Do the states manage the extra 600? Will it just appear one day for people on unemployment? What if your state has stricter unemployment rules than the stimulus bill? You’d be eligible for the 600 but not able to get it?

jmclnx 7y ago

The core ideas were reported upon, the real purpose is to bail out the banks (once again) and the fortune 500 companies. Very little is going to the people hardest hit.

miked85 7y ago
This is false, the plan specifically targeted small businesses: https://www.sba.gov/page/coronavirus-covid-19-small-business-guidance-loan-resources https://www.sba.gov/page/coronavirus-covid-19-small-business...
- techntoke 7y ago
  You mean the money being managed by the person Trump just fired?
  - techntoke 7y ago
    Here, would you like proof? https://www.latimes.com/world-nation/story/2020-04-07/trump-upends-virus-oversight-removing-key-official https://www.latimes.com/world-nation/story/2020-04-07/trump-...
  - deleted 7y ago
    [deleted]
- notyourday 7y ago
  The plan is a death spiral financing which puts a small business into a worse position after taking it than before. They have no revenue due to a government action, loan is based on the value of their payroll with the revenue and the the small business is required to spend 75% of the loan for payroll while being closed. The fact that banks claimed that 0.5% interest is not enough for them to make it worth it so the Treasury bumped the number and cut repayment schedule is the clearest demonstration yet that it is another hand out to banks.
  - chasd00 7y ago

jt2190 7y ago

Yes. This is part of the United State's Main Street Lending Program, called the Paycheck Protection Program (PPP). The federal government is guaranteeing loans made by private banks. This is taking time to work its way thorough the banks, as they try to understand their long-term legal obligations. In the mean time, some businesses are laying off or furloughing their employees so that their employees can get some money by claiming for unemployment benefits. Unemployment systems are established and somewhat functioning, unlike the loans, which probably need another week or two to start having an impact. Presumably, some of the workers will be recalled once loans are established. Edit: Removed redundant word.

_curious_ 7y ago
"Presumably, some of the workers will be recalled when once loans are established." So what happens if you are kept or rehired by your company under the PPP - but don't have any actual work to do?

tfandango 7y ago

The "free" loan is reportedly difficult to get since the government leaned on banks to provide these and banks are doing whatever they can to avoid the situation. For instance, Wells Fargo says they are out of those loans and Bank of America tried to make these loans dependent on already having another loan with them (policy revoked after outcry). Small businesses in our town are laying everyone off instead of waiting on these loans b/c the employees can qualify and receive unemployment immediately now. Once things open again, they plan to rehire the same people if possible. All this is anecdotal but seems to me that new unemployment rules are part of the rescue package (I don't really consider it a stimulus package)

rixrax 7y ago

Assume you are small business. Now try to find where / how / when You will get stimulus money? To cover what? I sure can’t.

_curious_ 7y ago
It's literally the gov just giving out money so these companies can keep the doors open and lights on under the guise of 'being in business'. The point is more of a psychological one - to create impression that things are going ok (or not as bad as it seems) at scale across the country.
- ModernMech 7y ago
  That's the theory, but in practice it's turning out harder than expected to acquire said money. The government isn't just "giving it out" in the sense you can just walk up to a bank and leave with a bag of cash. You have to apply for it and then be approved and then wait for it to show up. This process takes time, and it's not clear how much time. Another poster noted that Wells Fargo was capped at what they can distribute and BOA was refusing loans to people who were not already customers. So if you're a small business with Wells Fargo and get denied there after an unknown period of time it takes to process that application, then you turn to another large bank and get denied there, this is time wasted while a clock is ticking (rent is still due for your employees and yourself at the end of the month). So what do you do? Do you lay off your employees because they can apply for unemployment right away? Or do you hold out and hope that the third bank you apply to for a loan will be a success? What if it's not? It's very easy for Congress to say "We are giving out money. The businesses are saved!" It's quite another in the implementation of that, and to some degree I feel they were so eager to pass something that they didn't think these things through fully.
  - _curious_ 7y ago
    "So what do you do? Do you lay off your employees because they can apply for unemployment right away? Or do you hold out and hope that the third bank you apply to for a loan will be a success? What if it's not?" That's a case by case judgement call that only the owners/operators can answer given their situations and values. There is not universal or general advice answer here. "It's very easy for Congress to say "We are giving out money. The businesses are saved!" It's quite another in the implementation of that, and to some degree I feel they were so eager to pass something that they didn't think these things through fully." I fully agree and my comment above was to suggest their intent.

_curious_ 7y ago

"Is the number expected to be this high?" = Yes, some models/estimates suggest it will reach 30m, though I don't recall the horizon. "I thought one of the core ideas of the stimulus was to prevent firing by giving small businesses a "free" loan if they retained their employees?" = In some cases, I'm hearing that it is happening. In others, the funds are not flowing so owner/operators are proceeding to 'let go'. "I've been trying to find a good authority on the economics of this stimulus" = Understandable, but difficult enough during 'normal' conditions. Now, everyone becomes an expert.

nunez 7y ago

A lot of SMBs are having issues actually getting the money. One example: Wells Fargo is only authorized to distribute $10B of the money from PPP because of their scandal a few years back. Many SMBs use Wells Fargo for their business checking accounts. This has created a massive delay queue with folks having to reapply for assistance several times to no avail.