Wednesday, December 17, 2014

SBA 504 Loan Debenture Rate

SBA 504 Loan Debenture Rate for December      

The debenture rate is only 2.70% but note rate is 2.74% and the effective yield is 4.782%.

Monday, December 8, 2014

The SBA and betide



To happen.

From Old English tidan (happen), from tid (time).

Betide is often shortened to tide or tidings.  Such as when Linus Van Pelt declared in a Charlie Brown Christmas: “Fear not: for, behold, I bring you good tidings of great joy!”


Good tidings for the restaurant industry.

Driven by stronger sales and traffic and a more optimistic outlook among restaurant operators, the National Restaurant Association’s Restaurant Performance Index (RPI) posted a solid gain in October. The RPI – a monthly composite index that tracks the health of and outlook for the U.S. restaurant industry – stood at 102.8 in October, up 1.8 percent from its September level. In addition, the RPI stood above 100 for the 20th consecutive month, which signifies expansion in the index of key industry indicators.

According to the SBA, restaurants obtain more SBA 7(a) loans that any other business type.

If you would like a copy of the National Restaurant Association’s Restaurant Performance Index for October let me know.


SBA LIBOR Base Rate December 2014 = 3.16%
SBA Fixed Base Rate December 2014 = 5.19%

SBA 504 Loan Debenture Rate for November       

The debenture rate is only 2.80% but note rate is 2.84% and the effective yield is 4.879%.

Glad tidings are the only possible way to describe the report on employment for the month of November.

According to the Bureau of Labor Statistics, employment increased 321,000.  Jobs added last month were the most since January 2012 and only the second time this year that one-month gains exceeded 300,000.

Here is a summary of net payroll employment and this week’s interesting little table of data:
November                          321,000
October                               243,000
September                          271,,000
August                                  180,000
July                                       243,000
June                                      288,000
May                                       224,000
April                                     304,000
March                                   203,000
February                             222,000
January                               144,000
2013     2,074,000
2012     2,193,000
2011      2,103,000
2010     1,022,000
2009     -5,052,000
2008     -3,617,000
2007    1,115,000
2006     2,071,000
2005     2,484,000
2004     2,019,000

What does this mean?

I don’t know.

This was the tenth consecutive month over 200,000, and an all time record 50th consecutive month of job gains.  This is the best year since 1999.  Private employment is up 10.9 million from the recession low. 

Does that mean interest rates will be going up soon?

The Federal Reserve meets next week and officials are expected to debate retaining their “considerable time” commitment. The FOMC statement issued October 29th  repeated that officials expect to keep rates near zero “for a considerable time.  One of their concerns is that inflation remains below their target of 2%.  The Fed’s preferred gauge of price pressures facing U.S. consumers rose 1.4 percent in October from the same period a year ago and has not been above 2 percent since March 2012.

In the meantime, keep your eyes and ears open for this week’s sale of 30 year Treasury bonds.

Last month the Treasury Department’s $16 billion sale of 30-year notes sold at a yield of 3.092%.  Since then the 30 year yield has drifted around 2.97%.

The long bond yield has dropped more than 90 basis points since the start of the year.  July’s auction sold at a yield of 3.369%.  April’s $13 billion auction of 30 year Treasury bonds sold at a yield of 3.525%.  In March the auction drew a yield of 3.630% compared to February’s yield of 3.69%.  January’s auction sold at a yield of 3.899% compared to December’s 3.90%.  

This distinct flattening of the long end of the yield curve implies investors are rethinking the timing of Federal Reserve interest-rate hikes.
We now only use the word 'tide' to denote the regular rising and falling of the sea. We can get a better understanding of what 'tide' and 'betide' mean by substituting 'tide' with 'time', which is just what the mediaeval clerics did - the two words were near enough synonymous. Knowing that 'tide' means 'period of time' or 'season', we can see that a lunar tide can be translated as 'a period of approximately twelve and a half hours' .  The tide/time transliteration also survives in 'good tidings', that is, 'a good time.
Betide is hardly ever used anymore except  as 'woe betide you' as 'you are in for a bad time'.  Woe betide you if you don’t get the meaning of Christmas.
Charlie Brown, frustrated, screams out in classic Charlie Brown fashion: “Isn't there anyone who knows what Christmas is all about?”

Linus replies: “Sure, Charlie Brown, I can tell you what Christmas is all about.”

 "And there were in the same country shepherds abiding in the field, keeping watch over their flock by night. And lo, the angel of the Lord came upon them, and the glory of the Lord shone round about them: and they were sore afraid. And the angel said unto them, 'Fear not: for behold, I bring unto you good tidings of great joy, which shall be to all people. For unto you is born this day in the City of David a Savior, which is Christ the Lord. And this shall be a sign unto you; Ye shall find the babe wrapped in swaddling clothes, lying in a manger.' And suddenly there was with the angel a multitude of the heavenly host, praising God, and saying, 'Glory to God in the highest, and on earth peace, good will toward men.'"

Linus picks up his blanket and walks back towards Charlie Brown

“That's what Christmas is all about, Charlie Brown.”

Thursday, December 4, 2014

SBA 7(a) Loan Rate Update


SBA LIBOR Base Rate December 2014 = 3.16%
SBA Fixed Base Rate December 2014 = 5.19%
Lenders can charge up to 2.75% over these indices.