Goldman: Most Firms Have Depleted PPP Loans
Small firms recently surveyed by Goldman Sachs indicated that small , mid-sized businesses (SMBs) are desperately looking for another round of emergency Paycheck Protection Program (PPP) funding, according to CNBC.
David Solomon, CEO of Goldman Sachs, told CNBC (Dec. 15) that the small businesses it surveyed have been in dire need.
“They really have needs; 90 percent of these have exhausted their PPP funding at this point,” he said inside a CNBC Squawk Box interview. “More than half of them have had to put off employees and extremely constrain their businesses.”
Lawmakers continue to be focusing on solidifying another coronavirus stimulus bill to increase the $2.2 trillion CARES Act passed in late March, as well as enhanced unemployment benefits.
Goldman recently conducted market research of companies that took part in its 10,000 Small Businesses program, which will help to provide entrepreneurs with capital and training, Solomon said. Additionally, the bank announced that it had provided one more $250 million of funding towards the program, producing a total of $1 billion investment this season.
“This is a huge employment engine for that economy, and they're suffering right now,” Solomon said, per CNBC. “They need capital, liquidity to bridge them. They can see light at the end of the tunnel.”
In another interview with CNBC on Tuesday (Dec. 15), Berkshire Hathaway Chairman Warren Buffett called on Congress to provide more Paycheck Protection Program (PPP) loans to small businesses to help them survive the pandemic slowdown, that they likened to “an economic war.”
Small businesses “have become collateral damage inside a war that our country needed to fight, but we essentially voluntarily had an induced shutdown of areas of the economy striking many types of small company very, very hard,” Buffett said. “I hope greatly they extend the PPP intend on a sizable scale.”
Goldman Sachs said recently it anticipates a “V-shaped” recovery – when key economic indicators quickly bounce back from the recession – that could be larger than originally anticipated since a vaccine is originating available.