Obama To Announce Small Business Lending Details

Update: Watch the speech here.
Obama is likely to address AIG today along with details on small business lending.

Politico: President Obama and Treasury Secretary Geithner will join small business owners and community bank lenders at the White House to announce immediate action to ensure that credit – the lifeblood of America's small businesses and its economy – gets flowing again to entrepreneurs and business owners. This marks yet another critical step in implementing the Administration's Financial Stability Plan. Expect details of a new and aggressive effort to unlock the frozen credit markets for small business lending, new reporting requirements on bank lending to small businesses, and plans to temporarily eliminate Small Business Administration loan fees and increase guarantees through Recovery Act funding.

Look for the measures to include: Beginning today, any lender who participates in the 7(a) program can request a guarantee from the SBA of up to 90 percent for each loan. On any new 504 applications submitted beginning today, SBA will eliminate fees charged to lenders and processing fees charged to borrowers. And for any new 7(a) loan, the SBA will temporarily eliminate the up-front fees that lenders pass along to borrowers.

Left and Right Mock Geithner's Plan

Does this mean the plan is spot on or way off? Looks like everyone just wants more clarity.Seems to me there isn't enough time in the day to take care of everything that's imploding.
Wall Street wants details. Treasuries are in love with Geithner:

Treasuries rose, pushing yields on 10-year notes down the most in almost two months, on speculation a U.S. plan to rescue the banking system will prove inadequate, boosting demand for the safety of government debt.

U.S. securities gained as the Treasury’s sale of a record $32 billion of three-year notes drew greater demand than forecast. Treasury Secretary Timothy Geithner pledged government financing that may grow to as much as $2 trillion.

“The Geithner speech is short on details and long on rhetoric,” said Maxwell Bublitz, who oversees $3.5 billion in bonds as chief strategist at San Francisco-based SCM Advisors LLC. “In a word, it is weak.”

The yield on the 10-year note tumbled 14 basis points, or 0.14 percentage point, the most since Dec. 16, to 2.85 percent at 3:12 p.m. in New York, according to BGCantor Market Data. The price of the 3.75 percent security maturing in November 2018 climbed 1 6/32, or $11.88 per $1,000 face amount, to 107 18/32. Read more at Bloomberg.

Salon:

But I don't think that's why the market is so glum. Geithner started out strong, with a clear description of the plight we're in, and a clear explanation of why government needed to take swift and strong action. But, once again, the speech was short on details -- and no more so than on the critical question of how the government will address the problem of dealing with the toxic assets that have effectively rendered large portions of the nation's financial system insolvent.

If there was a moment during the speech when investor sentiment crystallized, it came when Geithner announced that "we are exploring a range of different structures" to deal with precisely that issue.

Geithner Announces New Bank Restoration Plan

Here is some of what Treasury Secretary Timothy Geithner said this morning: 

The plan will provide help for homeowners and clean up the banking system.
How we got into this mess:
The causes of this crisis are many and complex, he said. Housing prices defied gravity and investors took risks they didn't understand. People and businesses borrowed beyond their means. When the crisis began, government was chasing it. Government was behind the curve and added to the anxiety and failure. Investors pulled back. Last fall, the government pulled the banks from catastrophic failure but it wasn't enough. Americans' distrust turned to anger. Our challenge is greater today because Americans have lost faith in government.
To restore faith of the American people:
Policy has to be comprehensive and forceful. Action has to be sustained - can't apply breaks to early. Transparency. We need to mobilize and leverage private capital.
The new plan will pull all financial agencies together.
Financialstability.gov will provide transparency, where contracts will be posted.
1) Banking institutions will go through a stress test to see if they're strong or weak.
2) Work with FDIC and other agencies to form a private/public fund for the bad debts. How the assets are valued is still being designed.
3) Get the banks lending again. For small businesses, we're going to up the SBA loans.
4) We will launch a housing program, the details of which will be announced in the next few weeks.
All of the financial agencies helped shape the plan, he said. It will require more "resources" (money). Geithner will be in Italy meeting with G7 partners to work on the global financial system. We will work with the IMF.
Most of the programs I've discussed involve very large numbers. The plan will cost money, involve risk and it will take time.
Obama will be answering stimulus questions in Fort Myers at noon.
Geithner's opposition. More reaction from NYT to the bailout. Stocks are down. Wall Street says it wants details. Geithner's speech didn't provide enough meat. 

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Transcript