Link This | Email this | Blog This | Comments (0)

Economic Myths Debunked

November 4, 2008 A working paper authored by three economists for the Federal Reserve Bank of Minneapolis reports that four claims about the nation’s current finanical crisis appear to be myths. The findings of the research paper, based on data up until Oct. 15, report:
•Bank lending to corporate America and individuals has not declined.
•Lending between banks has not dried up.
•Commercial paper (short-term borrowing by nonfinancial companies) has fallen, but not seized up as a source of commercial lending. (Indeed, commercial-paper levels last week started to head back up for the first time since the failure of Lehman Brothers, in mid-September.)
•Banks do not, as popularly believed, play a large role in channeling money from savers to borrowers. 
Click hear to read the paper
I learned about this research paper in article that appeared in the Star Tribune
The article also included an interview with American Spirit Graphics ($70 million in sales and ranked #78 on the GAM 101) CEO Oscar Carlson, who recently borrowed $2.75 million to purchase new presses. He said getting the money was not a problem. A statement echoed by three printers who announced the purchase of Komori presses last week at Graph Expo in Chicago.
Carlson said while he fears the prospect of economic downturn, it is good time to expand, because printers can get better prices on equipment and loans.

Posted by Lisa Cross on November 4, 2008 | Comments (0)