Goldman Sachs: Some 90 Pct Of Businesses Have Depleted PPP Monies

Small firms recently surveyed by Goldman Sachs indicated that small and mid-sized businesses (SMBs) are desperately in need of another round of emergency Paycheck Protection Program (PPP) funding, according to CNBC.

David Solomon, CEO of Goldman Sachs, told CNBC on Tuesday (Dec. 15) that the small businesses it surveyed are in dire need.

“They really have needs; 90 percent of them have exhausted their PPP funding at this point,” he said in a CNBC Squawk Box interview. “More than half of them have had to lay off employees and really constrain their businesses.”

Lawmakers are still working on solidifying another coronavirus stimulus bill to add to the $2.2 trillion CARES Act passed in late March, as well as enhanced unemployment benefits.

Goldman recently conducted a survey of companies that participated in its 10,000 Small Businesses program, which helps to provide entrepreneurs with capital and training, Solomon said. In addition, the bank announced that it had provided an additional $250 million of funding to the program, resulting in a total of $1 billion investment this year.

“This is a huge employment engine for the 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, which he likened to “an economic war.”

Small businesses “have become collateral damage in a war that our country needed to fight, but we in effect voluntarily had an induced shutdown of parts of the economy and hit many types of small business very, very hard,” Buffett said. “I hope very much they extend the PPP plan on a large scale.”

Goldman Sachs said last month that it anticipates a “V-shaped” recovery — when key economic indicators quickly bounce back from a recession — that could be bigger than originally anticipated now that a vaccine is coming available.