Congratulations taxpayers. You are about to invest in the subprime commercial loan business.
County Executive Bill McRyneolds has proposed the use $250,000 or more from our reserves to "create a revolving loan fund to be used only by small businesses in Racine County." The county "would realize a return of 1.5 to 2 percent." "The borrowers may be people with poor credit histories, bankruptcies in their past or women disadvantaged by divorce" the Journal Times reports that McReynolds has said. "Naturally they're going to have defaults, but their default rate is not much bigger than a commercial bank from what I've been told."
By now we ought to know what happens when risky loans go belly up. The borrowers claim victim status and accuses the lender of predatory practices. That makes you, the taxpayer, the predatory lender.
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8 comments:
Hmmm...
Sounds like a good time to incorporate!
;-P
Meh.. My credit rating is probably too good.
8-(
Well, Caledon, I will be glad to tell anyone who will listen that you are a divorced, bankrupt woman if that would help you out.
Sorry
I think the idea to help start/attract small business is a good one.
Think too that the program needs be careful of who they loan the funds to.
We need to think outside the box here for too long we have let RCEDC lead the way and gained nothing from it
anon, 7:31, if you really think this is a good idea, why not call Bill McReynolds and contribute some more of your own money? It is your money, and mine, that they are using for this experiment. They will lose our money. The majority of small businesses fail within a year or two. With a potential default rate of 50%, I think the projected returns of a meager 2% will never happen. But if you think otherwise, I say put your money (not mine) where your mouth is.
That last comment was perhaps a bit snotty. I don't mean to be, I just think the loan idea to financially troubled business start-ups is a really bad idea and few people would voluntarily invest their money in this manner. So why should we do it via our government?
I think the monet should 'trickle up' the way that Uncle Ronnie intended it.
The rich should get richer - God knows they have been transfering wealth from us all, with Republican help, for decades.
Check the stats...
Sir
If that is the worse I get it no big thing.
And I did what you asked called and offered not only my thanks BUT stepped up to the plate.
What I can offer may not be much but it is what I have.
Far more then RCEDC has done in the past few years
Jobs with good wages and benefits.
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