Business owners are optimists

I enjoy working with business owners because they are some of the most optimistic people in the world. In fact, I'd call them serial optimists!

How else can they see opportunities even in the face of really ugly circumstances?

“The uncertainty in the small business sector is climbing again as owners continue to manage historic inflation, labor shortages, and supply chain disruptions,” said Bill Dunkelberg, NFIB Chief Economist. “As we move into the second half of 2022, owners will continue to manage their businesses into a very uncertain future.”

Despite this uncertainty I'm consistently getting requests from business owners who need money to buy Christmas inventory, purchase new warehouse space, pay for aggressive marketing campaign and many other growth-oriented activities.

Some are taking advantage of markets abandoned by competitors and others are upping their game and signing on for big deliveries they have no clue how they're going to fill. I regularly get urgent requests for capital to buy equipment and materials at bargain prices which means there's a lot of activity happening behind the headlines.

The economic picture remains bleak for American consumers who represent the life's blood of small businesses as they adjust their spending habits to reflect higher cost of living and stagnant wages. Even though that condition will spell certain disaster for many small businesses they are up to the fight and their attitude is one of defiance and roll-up-my-sleeves determination which I admire greatly. Optimism isn't delusional when it's accompanied by focused action and purpose.

Capital costs are also rising along with everything else adding new urgency to most business plans:

"Now, APRs are set to soar again as the Federal Reserve gears up for another big rate announcement and other lenders continue to catch up to previous federal rate hikes. So far, the Federal Reserve has increased rates by a historic 2.25 percentage points since March and is expected to hike rates again later this month.
And with more lenders still due for another rate hike, the average card APR is poised to soar"

Private rates have remained stable and even lower since the Fed hikes. The same goes for hard money loans even though they are closer to conventional bank rates. Private lending rates have always been a more accurate reflection of supply/demand for capital because they're not subsidized for political purposes, private lenders only look at risk/reward and charge accordingly.

It's no accident that unsecured Credit Card advance APR's are many multiples over the mortgage and SBA loan interest rates. Businesses who seek quick, unsecured capital can expect to pay more than SBA rates to use PLC (Private Lending Capital) for short term needs.

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