Seventy-nine percent of small-business owners expect the economy to be flat or in recession in the coming year, the National Small Business Association said in a report released today.
The association’s midyear snapshot of how small business is dealing with the economic slowdown found that owners “are feeling less confident in nearly every way, particularly with banks’ ability to keep their money safe,” said association president Todd McCracken.
The association membership was surveyed in late August and early September, before the recent financial institution meltdowns and government bailouts, so it is possible that more recent polling could find even more pessimism.
McCracken said decreasing home values, the tight credit market, and failure of financial institutions contributed to the negativity.
Some small-business owners who have leveraged their business loans with a second home mortgage said their loans outweigh the value of their homes. One-third of the owners said they have been hit with higher bank-loan terms.
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