Prominent among the cautious were small businesspeople. To help disentangle the complex contributions of small businesses to economic growth and development, the Atlanta Fed in 2010 sponsored conferences, stepped up research, and launched an online small business information hub.
Credit was a major focus. The Atlanta Fed and its partners sought to advance the conversation about how to encourage safe lending while ensuring credit availability to creditworthy small businesses. As part of a nationwide series of meetings convened by the Federal Reserve, the Atlanta Fed held gatherings in each southeastern state to examine the credit challenges facing small businesses. Those meetings produced a consensus that small business sales and balance sheets had been pinched by the recession, hurting the creditworthiness of many firms and discouraging many from taking on debt.
However, opinions differed concerning the reasons why lenders curtailed credit. Some small businesspeople argued that banks' lending requirements were making it difficult for even solid firms to borrow. Many bankers countered that there simply was insufficient demand from the small companies that could meet tougher lending requirements necessitated by tighter regulation. They also pointed to their own troubled balance sheets and the difficult economy. As Atlanta Fed head of supervision and regulation Michael Johnson said in his quarterly Financial Update column, "The story is not straightforward."